EXHIBIT 10.14
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LEASEHOLD MORTGAGE AND SECURITY AGREEMENT
between
▇▇▇▇▇ HARBORSIDE ASSOCIATES II LIMITED PARTNERSHIP,
as Mortgagor
and
SHAWMUT BANK, N.A., AS TRUSTEE,
as Mortgagee
Upon recording, please return to:
Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇, Esq.
INDEX
PARAGRAPH PAGE
1. Definitions . . . . . . . . . . . . . . . . . . . . . . . . 7
2. Warranty of Title . . . . . . . . . . . . . . . . . . . . . 13
3. Payment of Sums Secured . . . . . . . . . . . . . . . . . . 13
4. Performance of Agreements . . . . . . . . . . . . . . . . . 13
5. Construction of Project; Construction Inspector;
Phase C Garage. . . . . . . . . . . . . . . . . . . . . . . 14
6. Waste, Maintenance, Compliance, and Inspection. . . . . . . 15
7. Insurance . . . . . . . . . . . . . . . . . . . . . . . . . 16
8. Taxes and Other Charges . . . . . . . . . . . . . . . . . . 19
9. Escrow Funds. . . . . . . . . . . . . . . . . . . . . . . . 20
10. Security Agreement; Additional Security . . . . . . . . . . 21
11. Ground Lease; Subleases . . . . . . . . . . . . . . . . . . 21
12. Right to Remedy Defects . . . . . . . . . . . . . . . . . . 27
13. Condemnation. . . . . . . . . . . . . . . . . . . . . . . . 28
14. Events of Default . . . . . . . . . . . . . . . . . . . . . 30
15. Remedies. . . . . . . . . . . . . . . . . . . . . . . . . . 31
16. Assignment of Subleases and Rents after default . . . . . . 32
17. Counsel Fees. . . . . . . . . . . . . . . . . . . . . . . . 32
18. Notice. . . . . . . . . . . . . . . . . . . . . . . . . . . 33
19. Cumulative Rights and Remedies. . . . . . . . . . . . . . . 33
20. Waiver of Defenses and Certain Notices. . . . . . . . . . . 33
21. Satisfaction of This Mortgage . . . . . . . . . . . . . . . 33
22. Books, Records and Accounts . . . . . . . . . . . . . . . . 33
23. Management Agreement. . . . . . . . . . . . . . . . . . . . 34
24. Transfers of the Project, etc . . . . . . . . . . . . . . . 34
25. Estoppel Affidavits . . . . . . . . . . . . . . . . . . . . 35
26. Invalid Provisions To Affect No Others. . . . . . . . . . . 35
27. Captions. . . . . . . . . . . . . . . . . . . . . . . . . . 35
28. Further Assurances. . . . . . . . . . . . . . . . . . . . . 35
29. Notice to Mechanics and Materialmen . . . . . . . . . . . . 35
30. Recorded Instruments. . . . . . . . . . . . . . . . . . . . 36
31. Use . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
32. Successors and Assigns. . . . . . . . . . . . . . . . . . . 36
33. Good Standing . . . . . . . . . . . . . . . . . . . . . . . 36
34. Right of Release. . . . . . . . . . . . . . . . . . . . . . 37
35. Interpretation. . . . . . . . . . . . . . . . . . . . . . . 37
36. Amendments. . . . . . . . . . . . . . . . . . . . . . . . . 37
37. Parity Indebtedness . . . . . . . . . . . . . . . . . . . . 37
38. Subordinate Indebtedness. . . . . . . . . . . . . . . . . . 40
39. Governing Law . . . . . . . . . . . . . . . . . . . . . . . 40
40. Hazardous Substances. . . . . . . . . . . . . . . . . . . . 40
41. No Personal Liability . . . . . . . . . . . . . . . . . . . 43
42. Joinder by Landlord . . . . . . . . . . . . . . . . . . . . 43
(i)
MORTGAGE AND SECURITY AGREEMENT
THIS LEASEHOLD MORTGAGE AND SECURITY AGREEMENT (this "Mortgage") is
dated as of December 15, 1990, by ▇▇▇▇▇ HARBORSIDE ASSOCIATES II LIMITED
PARTNERSHIP, a Massachusetts limited partnership having an address c/▇
▇▇▇▇▇▇▇▇ Development Associates, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ (the "Mortgagor"), in favor of SHAWMUT BANK, N.A., a national banking
association, with its principal office in Boston, Massachusetts, not
individually but in its capacity as Trustee (the "Mortgagee") under that
certain Loan and Trust Agreement (the "Loan Agreement") dated as of
December 15, 1990, among the Trustee, the Massachusetts Port Authority (the
"Authority"), and Mortgagor, in connection with the issuance of the
$40,000,000 Massachusetts Port Authority Special Project Revenue Bonds,
Series 1990 (Harborside Hyatt Conference Center and Hotel Project) (the
"Bonds").
Reference is made to the following facts:
A. The Authority, as landlord, and Massachusetts Technology Center
Associates (the "Developer"), as tenant, entered into a certain lease Dates
as of April 30, 1982, as amended (such lease, as amended, is hereinafter
referred to as the "Initial Lease"), with respect to the development of
approximately 19.126 acres of land located at the southwest corner of ▇▇▇▇▇
International Airport (the "Airport") in East boston, Massachusetts. A
Notice of Lease with respect to the Initial Lease is recorded with the
Suffolk County Registry of Deeds in Book 9995, Page 243, and filed with the
Suffolk County Registry District of the Land Court as Document No. 363450
and noted on Certificate of Title No. 297.
B. The Initial Lease was amended, restated and superseded in its
entirety by a certain Ground Lease dated as of May 1, 1983, between the
Authority and the Developer (such ground lease is hereinafter referred to
as the "Master Lease"). A Notice of Lease with respect to the Master Lease
is recorded with the Suffolk County Registry of Deeds in Book 10363, Page
276, and filed with the SUFFOLK COUNTY REGISTRY District of the Land Court
as Document No. 371701 and noted on Certificate of Title No. 207. The
Master Lease contemplated that the Authority would enter into separate
leases of portions of the entire Leased Premises demised (the "Original
Premises") under the Master Lease corresponding to the separate phases of
the Development (as such phases and Development are defined in the Master
Lease).
C. As contemplated by and pursuant to the Master Lease, the
Authority and the Developer entered into a separate lease dated as of May
2, 1983, for the so-called "Phase A" of the Development (the "Phase A
Lease"); a notice of the Phase A Lease
is recorded with the Suffolk County Registry of Deeds in Book 10363, Page
284, and filed with the Suffolk County Registry District of the Land Court
as Document No. 370702 and noted on Certificate of Title No. 297.
D. By virtue of an Assignment of Lease dated April 20, 1989, the
developer assigned (with the Authority's consent) to ▇▇▇▇▇ Harborside
Associates I Limited Partnership ("▇▇▇▇▇ Harborside I") all of the
Developer's right, title and interest under the Master Lease with respect
to all portions of the Original Premises, except for the portion thereof
previously covered by and subject to the separate Phase A Lease. A notice
of such assignment of lease was recorded with the Suffolk County Registry
of Deeds in Book 15531, Page 87, and filed with the Suffolk County Registry
District of the Land Court as ▇▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇ and noted on Certificate
of Title No. 297.
E. The Master Lease was amended by and Amendment to Lease dated as
of September 15, 1990, between the authority and ▇▇▇▇▇ Harborside I; on or
about December 26 or 27, 1990, a notice of such amendment is being recorded
with the Suffolk County Registry of Deeds and is being filed with the
Suffolk County Registry District of the Land Court for notation on
Certificate of Title No. 297. The Master Lease, as amended by such
amendment, is hereinafter referred to as the "Original Lease."
F. As contemplated by and pursuant to the Original Lease, the
Authority, as landlord, and Mortgagor, as tenant, entered into a certain
Ground Lease for Phase C of the Bird Island Flats Development dated as of
September 15, 1990, as affected by a Landlord's Consent and Estoppel
Certificate dated as of December 15, 1990 (as so affected, the "Phase C
Lease" or the "Ground Lease"), with respect to Premises (the "Leased
Premises") containing approximately six acres of land at the Airport,
together with the appurtenant right to use certain Off-Premises sites (the
"Off-Premises Parking Sites") for parking purposes in accordance with
certain conditions set forth in the Ground Leases. The Leased Premises and
the Off-Premises Parking Sites are more particularly described in the Phase
C Lease, and on or about December 26 or 27, 1990, a Notice of Lease with
respect thereto is being recorded with the Suffolk County Registry of Deeds
and is being filed with the Suffolk County Registry District of the Land
Court for notation on Certificate of Title No. 297; the Leased Premises and
the Off-Premises Parking Sites constitute portions of the Original
Premises. The Leased Premises and the Off-Premises Parking Sites are more
particularly described in the attached Exhibit A.
G. By virtue of an Assignment of Lease dated as of September 15,
▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ I released and assigned to the Mortgagor all of
▇▇▇▇▇ Harborside I's right, title and interest under the Original Lease
with respect to the Leased
Premises, consented to the use of portions of the Original Premises as Off-
Premises Parking Sites and subordinated its rights as tenant under the
Original Lease to the Mortgagor's rights in and to the Off-Premises Parking
Sites; on or about December 26 or 27, 1990, a notice of such assignment is
being recorded with the Suffolk County Registry of Deeds and is being filed
with the Suffolk County Registry District of the land Court for notation on
Certificate of Title No. 297.
H. The Phase C Lease amends and restates the Original Lease with
respect to the Leased Premises and the Off-Premises Parking Sites.
I. The Ground Lease provides that with respect to the Leased
Premises the Mortgagor and Mortgagee will be entitled to rely on the terms
of the Ground Lease notwithstanding any contrary or additional provisions
of the Original Lease; in that regard the Ground Lease shall be deemed to
be a separate lease with respect to the Leased Premises.
J. Pursuant to the Ground Lease, Mortgagor intends to build and
operate on the Leased Premises a 270-room conference center and hotel and
certain related facilities, including parking facilities, and to build and
operate from time to time at the Off-Premised Parking Site(s) certain
surface parking facilities (the "Project").
K. Pursuant to the Loan Agreement, the Authority, in its capacity
as issuer of the Bonds, is lending to Mortgagor the proceeds of the sale of
the Bonds (the "Loan") to finance the construction, equipping and
furnishing of the Project.
NOW THEREFORE, in consideration of the Loan and to secure the payment
of the same, all other sums provided for in the Loan Agreement or in this
Mortgage to be paid to Mortgagee, all other agreements and obligations of
Mortgagor contained in the Loan Agreement and this Mortgage, Mortgagor
hereby grants to Mortgagee, with MORTGAGE COVENANTS, all of Mortgagor's
right, title and interest in and to the leasehold estate described in
Exhibit A Attached hereto and made a part hereof (the "Leasehold Estate"),
together with all of Mortgagor's right, title and interest in and to the
following:
(i) any and all Improvements (as hereinafter defined);
(ii) the Off-Premises Parking Site(s);
(iii) all right, title and interest of Mortgagor, now owned or
hereafter acquired, in and to any land lying in the bed of any street, road
or avenue, open or proposed, in front of or adjoining the Leasehold Estate
and all easements
and rights of way, public or private, now or hereinafter used in
connection with the Leasehold Estate;
(iv) all right, title and interest of Mortgagor, now owned or
hereafter acquire, in and to any and all sidewalks and alleys, and all
strips and gores of land, adjacent to or used in connection with the
Leasehold Estate;
(v) subject to the provisions of Paragraphs 7 and 13 of this
Mortgage, all right, title and interest of Mortgagor, now owned or
hereafter acquired, in and to any and all awards, damages, payments and
other compensation and any and all claims therefor and rights thereto which
may result from taking or injury by virtue of the exercise of the power of
eminent domain of or to, or any damage, injury or destruction in any manner
caused to the Premises (as hereinafter defined), or any part thereof, or
from any change of grade or location of any street abutting thereon, all of
which awards, damages, payments, compensation, claims and rights are hereby
assigned, transferred and set over to Mortgagee to the fullest extent that
Mortgagor may under the law so do; expressly excluded from the foregoing
awards, damages, payments, compensation, claims and rights assigned,
transferred and set over as aforesaid are the Excluded Damages (as
hereinafter defined). Mortgagee is hereby irrevocably appointed attorney-
in-fact coupled with an interest for Mortgagor to settle for, collect and
receive any such awards, damages, payments and compensation from the
authorities making the same, to appear in and prosecute any proceeding
therefor, and to give receipts and acquaintances therefor;
(vi) any and all fixtures, and all machinery, equipment,
chattels, goods and other articles of property, whether real estate or not,
now or hereafter attached to or situated in or upon, and used or useful in
the operation of, the Leasehold Estate or the Improvements thereon, or of
any business now or hereafter operated by the owner or any occupant of the
Leasehold Estate and/or the Improvements thereon, or any part of either or
both, or any part thereof, (except any personal property, furnishings or
furniture owned by any subtenant unrelated to Mortgagor occupying the
Leasehold Estate and/or the Improvements thereon, or any part of either or
both and used by such subtenant in the conduct of its business in the space
occupies by it, to the extent that the same does not become the property of
Mortgagor, as sublandlord, under the sublease with such subtenant or under
applicable law and any personal property, furnishings or furniture owned by
the Manager [as hereinafter defined]); expressly excluded from the
fixtures, machinery, equipment, and other property and property
interests described in the foregoing clause (vi) is the Leased
Equipment;
(vii) all gas and electric fixtures, radiators, heaters,
engines and machinery, boilers, elevators and motors, bathtubs, sinks,
water closets, basins, pipes, faucets, air-conditioning equipment, plumbing
fixtures, heating fixtures, mirrors, mantels, refrigerating plant,
carpeting, furniture, ranges, refrigerators, ovens, dishwashers, laundry
equipment, cooking apparatus and appurtenances, all furniture, furnishings,
fixtures and equipment and all uniforms, food, utensils, tablesettings and
linen now or hereafter used in connection with the Project, and all
building material and equipment now or hereafter delivered to the Leasehold
Estate and/or the Improvements thereon, or any part of either or both and
intended to be installed therein; and all renewals or replacements thereof,
all additions thereto or articles in substitution thereof and all of the
estate, right, title and interest of Mortgagor in and to all property of
any nature whatsoever, now or hereafter situate on or in the Leasehold
Estate and/or the Improvements thereon, or any part of either or both or
intended to be used in connection with the operation thereof shall be
deemed to be fixtures and a part of the realty as between the parties
hereto and all persons claiming by, through or under them and shall be
deemed to be a portion of the security for the indebtedness herein
mentioned and secured by this Mortgage; expressly excluded from the
fixtures, machinery, equipment, and other property and property interests
described in the foregoing clause (vii) is the Leased Equipment;
(viii) all right, title and interest of Mortgagor in and to
all unearned premiums accrued, accruing or to accrue under any and all
insurance policies now or hereafter obtained by Mortgagor with respect to
the Premises (as hereinafter defined);
(ix) all rights, dividends and /or claims of any kind, nature
or description whatsoever (including, without limitation, damage, secured,
unsecured, lien, priority, or administration claims); together with the
right to take any action or file any papers or process in any court of
competent jurisdiction, which may in the opinion of Mortgagee be necessary
to preserve, protect, or enforce such rights or claims; including without
limitation the filing of any proof of claim in any insolvency proceeding
under any state, federal or other laws; including any rights, claims or
awards accruing to, or to be paid to, Mortgagor in its capacity as
sublandlord under any sublease affecting all or any portion of the
Leasehold Estate and/or the Improvements thereon. Mortgagee's lien and
interest in the foregoing.
rights and claims is hereby deemed to be presently vested and
perfected as of the date hereof;
(x) all subleases, already in existence and to be created in
the future with respect to the Premises together with all income, rents,
revenues, receipts, royalties, issues, profits, proceeds and other benefits
from any and all of the Premises of any kind whatsoever (collectively the
"Rents and Profits");
(xi) all and singular the tenements, hereditaments and
appurtenances belonging to the Leasehold Estate or any part thereof, or the
Improvements thereon, hereby mortgaged or intended so to be, or in anywise
appertaining thereto (including but not limited to the Rents and Profits),
all streets, alleys, passages, ways, watercourses, licenses, easements, all
other rights, liberties and privileges of whatsoever kind or character, the
reversions and remainders, and all the estate, right, title, interest,
property, possession, claim and demand whatsoever, as well at law or in
equity, of Mortgagor, in and to all the foregoing or any or every part
thereof;
(xii) all goods, accounts, contract rights, and other rights to
the performance of obligations;
(xiii) all rights to the payment of money, including tax refund
claims, insurance proceeds and tort claims and all rights to proceeds of
any termination, including any partial termination, of employee benefit
plans;
(xiv) all chattel paper, documents and instruments; and
(xv) all general intangibles, patents, copyrights, trademarks,
trade names, together with all right, title and interest of the Mortgagor
in and to all patents and trademarks which the Mortgagor may hereinafter
acquire, the right to file and prosecute applications for patents and
trademarks and similar intellectual property anywhere in the world and the
good will of the business connected with the use of and symbolized by such
intellectual property, together with all assets which uniquely reflect the
good will of the business of the Mortgagor, including but not limited to,
the Mortgagor's trade names, customer lists, trade secrets, corporate and
other business records, license rights, advertising materials, operating
manuals, methods, processes, know-how, sales literature, drawings,
specifications, descriptions, inventions, name plates, catalogues,
copyrights, dealer contracts, supplier contracts, distribution agreements,
confidential information, consulting agreements, engineering contracts and
engineering drawings.
The Leasehold Estate, Improvements, fixtures, machinery, equipment,
tenements, and other property interests described and enumerated in clauses
(i) through (xv) above, are hereinafter collectively referred to as the
"Premises".
Mortgagor covenants, warrants and agrees with Mortgagee as follows:
1. DEFINITIONS. As used in this Mortgage, unless the context
otherwise requires, the following terms shall have the following meanings:
"Architect" shall mean RTKL Associates, Inc. or such other licensed
architect reasonably designated by Mortgagor.
"Architect's Consent to Assignment" shall mean the Agreement With
Respect to and Assignment of Architect's Contract, to be entered into
between Mortgagor and the Architect for the benefit of Mortgagee, as
additional security for the Loan.
"Architect's Contract" shall mean the contract between Mortgagor and
the Architect dated as of March 29, 1990, with respect to design and
construction supervision services for the Project, as the same may from
time to time be amended, supplemented or otherwise modified.
"Assignment of Contracts" shall mean the Collateral Assignment of
Contracts, Licenses, Permits, Agreements, Warranties and Approvals, of even
date herewith, made by Mortgagor to Mortgagee, as additional security for
the Loan.
"Assignment of Management Agreement" shall mean the Collateral
Assignment of Management Agreement, of even date herewith, made by
Mortgagor to Mortgagee, as additional security for the Loan.
"Assignment of Rents" shall mean the Collateral Assignment of Rents
and Leases, of even date herewith, made by Mortgagor to Mortgagee, as
additional security for the Loan.
"Authority" shall mean the Massachusetts Port Authority.
"Basic Documents" shall mean, collectively, the Loan Agreement, the
Ground Lease, the Disbursement Agreement, this Mortgage and the Collateral
Assignments.
"Chapter 21E" shall mean the Massachusetts Hazardous Material Release
Prevention and Response Act of 1983, Massachusetts General Laws, Chapter
21E, as the same may from time-to-time be amended.
"Closing" shall mean the closing at which this Mortgage and the other
Basic Documents are executed and the Bonds are issued and delivered by the
Authority, as issuer, and the proceeds of the sale of the Bonds are
deposited with Mortgagee in accordance with the terms of the Loan
Agreement.
"Collateral Assignments" shall mean, collectively, the Architect's
Consent to Assignment, the Assignment of Contracts, the Assignment of
Management Agreement, the Assignment of Rents, and the Contractor's Consent
to Assignment.
"Construction Inspection Agreement" shall mean the agreement to be
entered into between Mortgagor and the Construction Inspector with respect
to inspection of the construction of the Project on behalf of Mortgagee and
the performance of certain other work for Mortgagee in connection with the
construction of the Project.
"Construction Inspector" shall mean Whitney, ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇
Associates, Inc., or such other architect or engineer selected by Mortgagor
and reasonably acceptable to Mortgagee.
"Construction Contract" shall mean the guaranteed maximum price
contract to be entered into between Mortgagor and the General Contractor
with respect to the construction of the Project, as the same may form time
to time be amended, supplemented or otherwise modified.
"Construction Guaranty" shall mean the construction guaranty, if any,
provided for the benefit of Trustee.
"Disbursement Agreement" shall mean the Disbursement Agreement dated
as of December 15, 1990, between Mortgagor and the Trustee, as the same may
from time-to-time be amended, supplemented or otherwise modified.
"Event of Default" shall mean any event set forth in Paragraph 14
hereof.
"Excluded Damages" shall mean: (i) all right, title and interest of
Landlord pursuant to the Ground Lease in and to all awards, damages,
payments and other compensation and any claims therefor and rights thereto
on account of eminent domain, taking or casualty, except to the extent that
the Ground Lease and Paragraphs 7 and 13 hereof expressly provide that the
Mortgagee is entitled to certain priority rights to such awards, damages,
payments or other compensation in connection with a termination of the
Ground Lease; (ii) all right, title and interest of Mortgagor pursuant to
Section 10.4 of the Ground lease in and to any awards, damages, payments
and other compensation and claims therefor and rights thereto on account of
delays in the performance schedule due to the so-called Third Harbor
Tunnel,
but only to the extent that any such delays under this clause (ii) do not
delay completion of construction of the Project beyond the Completion Date
established under the Disbursement Agreement or increase the cost of
construction of the Project above the Project Budget (as defined in the
Disbursement Agreement); and (iii) all right, title and interest of
Mortgagor in and to any awards, damages, payments and other compensation
and claims therefor, and rights thereto on account of any taking of
temporary or permanent easements, in connection with the so-called Third
Harbor Tunnel affecting any portion of the Leasehold Estate, but only to
the extent that any such easements do not materially affect the Project, do
not delay completion of construction of the Project beyond the Completion
Date established under the Disbursement Agreement, or increase the cost of
construction of the Project above the Project Budget (as defined in the
Disbursement Agreement; to the extent any such easements do materially
affect the Project, delay completion of construction or increase costs of
construction as aforesaid, Mortgagee shall have a security interest in, and
mortgage lien on, any awards, damages, payments and other compensation
therefor.
"General Contractor" shall mean ▇▇▇▇▇▇ ▇. ▇. ▇▇▇▇▇▇▇▇ Company,
Incorporated or such other licensed contractor reasonably designated by
Mortgagor.
"Governmental Approvals" shall mean all approvals, certifications,
consents, licenses, permits, authorizations and other official action
required to be issues or taken by any Governmental Authorities for or with
respect to the construction and/or operation of the Project or the matter
with respect to which such term is used, including, without limitation, the
following:
(i) all applicable building, planning, subdivision.
environmental protection,and zoning by-laws, rules, regulations, permits
and approvals; and
(ii) all applicable federal, Massachusetts and local flood
hazard and wetlands laws, rules, regulations and approvals, including,
without limitation, the terms, and provisions of all so-called Orders of
Condition applicable to the construction and/or operation of the Project
and identified in the mortgagee's title insurance policy delivered to
Mortgagee as part of the Closing.
"Governmental Authorities" shall mean all federal, state, county and
municipal governments and all governmental and quasi-governmental agencies,
authorities, boards, commissions, bureaus, departments, authorities,
officials and officers thereof, now or hereafter having jurisdiction over
the
construction and/or operation of the Project or the matter with respect to
which such term is used.
"Ground Lease" shall have the meaning specified in Recital Paragraph
B.
"Impositions" shall mean the taxes and other charges described in
Paragraph 8 hereof.
"Improvements" shall mean all improvements now or hereafter made to
or erected on the Premises as part of the Project or otherwise.
"Involuntary Rate" shall mean the rate of interest equal to the
lesser of (i) the per annum rate of interest from time to time announced by
Shawmut Bank, N.A. at its principal office in Boston, Massachusetts, as its
Corporate Base Rate or (ii) the highest interest rate per annum permitted
under the laws of the Commonwealth of Massachusetts.
"Landlord" shall mean the Authority in its capacity as landlord under
the Ground Lease and any successor in interest to the Authority as such
landlord.
"Laws and Other Governmental Requirements" shall mean all laws,
statutes, ordinances, orders, rules, regulations and requirements now in
effect or at any time hereafter enacted or issued by any Governmental
Authorities which are applicable to Mortgagor, the Project or the matter
with respect to which such terms are used.
"Leased Equipment" shall mean all equipment, furnishings, and other
personal property (such as, by way of example and not limitation,
computers, telephones, vans, flatware, and televisions) leased by Mortgagor
and/or the Manager in connection with the operation of the Project.
Mortgagor hereby agrees that any lease or similar agreement ("Equipment
Lease") with respect to Leased Equipment which is substantial and material
for the operation of the Project shall provide as follows: (i) the
Mortgagor's interest under the Equipment Lease shall be assignable to
Mortgagee as additional security for the Loan; and (ii) Mortgagee shall be
entitled to notice from the equipment lessor of any default by Mortgagor
under the Equipment Lease and shall be entitled to a reasonable period
within which to cure such default.
"Leasehold Estate" shall have the meaning specified in the recitals
of this Mortgage.
"Loan" shall mean the loan of the proceeds of the sale of the Bonds
made by the Authority to Mortgagor pursuant to the Loan Agreement.
"Loan Agreement" shall have the meaning specified in the recitals of
this Mortgage, as the same may from time to time be amended, supplemented
or otherwise modified.
"▇▇▇▇▇▇▇▇ Control" shall mean any rights and responsibilities
necessary for ▇▇▇▇▇▇▇▇ Development Associates, L.P., a delaware limited
partnership, and/or any one or more of its principals (who are ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇) to maintain the controlling,
decision making responsibility for Mortgagor in the conduct of its
business, along with ownership (which may be direct or indirect through one
or more intermediaries) of at least 25% of the partnership interests in
Mortgagor.
"Manager" shall mean Hyatt Corporation or such other nationally
recognized operator of hotel and/or conference center facilities selected
by Mortgagor.
"Management Agreement" means the agreement between Mortgagor and
Manager dated March 15, 1990, on the cover sheet and dated as of
February 1, 1990, in the text as supplemented by a letter agreement with
respect to the FFE Budget process dated March 15, 1990, with respect to the
management and operation of the Project, as the same may from time to time
be amended, supplemented, otherwise modified or replaced.
"Permitted Encumbrances" shall mean those matters listed on the
mortgagee's title insurance policy delivered to Mortgagee at the Closing,
Subordinate Mortgages, Parity Mortgages, temporary surface or subsurface
easements granted to or taken by third parties that do not materially
affect the Project, utility easements and the like that do not unreasonably
interfere with the Project, and any other title exceptions or objections,
if any, as Mortgagee may approve in writing.
"Parity Indebtedness" and "Parity Mortgage" shall have the meanings
ascribed to them in Paragraph 37 of this Mortgage.
"Permitted AEW Transfer" shall mean any transfer of any interests in
the Mortgagor or any transfer of the Project or any transfer of the
Leasehold Estate to certain pension trusts represented by ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
and Waltch, Inc. as more particularly described in Section 7.1 of the
Ground Lease.
"Permitted Transfer" shall mean any transfer(s) of ownership
interests in Mortgagor or in any partnership or corporation holding any
legal or beneficial interest (whether directly or through one or more
intermediaries) in Mortgagor: (i) between or among ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ and/or ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇; (ii) to any individual or individuals who
are "Members of the Family" of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ or ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ (for purposes of this provision, "Members of the Family" shall
brothers, sisters, brothers-in-law, sisters-in-law, children-in-law and
grandchildren-in-law; any legally adopted child of an individual shall be
treated as a child of such individual by blood) or any trust for the
benefit of any such "Members of the Family"; and (iii) any transfer(s) to
other individuals or entities so long as following such other transfer(s)
under this clause (iii) ▇▇▇▇▇▇▇▇ Control of Mortgagor is retained.
"Plans" shall mean the Guaranteed Maximum Price Documents (as
described in the Ground Lease) prepared for construction of the Project,
and the plans and specifications that identify the fixtures, furnishings
and equipment for the Project, as the same may be amended or supplemented
in accordance with the Disbursement Agreement.
"Premises" shall have the meaning specified in the recitals of this
Mortgage.
"Project" shall have the meaning specified in Recital Paragraph D.
"Project Completion Date" shall mean the date by which the last of
the following shall have occurred: (i) the Architect shall have issued a
certificate of substantial completion for the Project; (ii) the
Construction Inspector shall have certified in writing that construction of
the Project has been substantially completed in accordance in all material
respects with the Plans; (iii) a certificate of occupancy (temporary or
permanent) covering the Project shall have been issued by the appropriate
Governmental Authorities; (iv) all other permits and licenses necessary for
the opening and operating of the Project as a conference center and hotel
shall have been issued by the appropriate Governmental Authorities; (v) all
of the conditions precedent to the "Opening Date," as defined in Section
1.8(b) of the Management Agreement shall have been satisfied; and (vi)
Mortgagor shall have delivered to Mortgagee the "Completion Certificate"
required under Section 602 of the Loan Agreement.
"Project Fund" shall have the meaning specified in the Loan
Agreement.
"Rents and Profits" shall mean all income, rents, revenues, receipts,
royalties, issues, profits, proceeds and other benefits from any and all of
the Premises of any kind whatsoever.
"Site" shall mean the parcel commonly known as Phase C on Harborside
Drive, East Boston, Massachusetts, more particularly described in Exhibit
A annexed hereto.
"Sublease" shall mean any sublease, license, concession or similar
occupancy agreement entered into between Mortgagor and any third party with
respect to all or any part of the Premises.
"Subordinate Indebtedness" and "Subordinate Mortgage" shall have the
meanings ascribed to them in Paragraph 38 of this Mortgage.
"Subordination Agreement" shall mean the Subordination, Non-
Disturbance and Attornment Agreement of even date herewith between
Mortgagee and the Manager.
"Title Insurer" shall mean Ticor Title Insurance Company or such
other nationally recognized title insurance company reasonably satisfactory
to Mortgagee.
2. WARRANTY OF TITLE. Mortgagor warrants that it is lawfully seized
of the Premises, that it has good right and is lawfully authorized to sell,
convey or encumber the same and that the Premises are free and clear of all
liens and encumbrances except for the Permitted Encumbrances. Mortgagor
further covenants to warrant and forever defend all and singular the
Premises unto Mortgagee forever from and against Mortgagor and all persons
whomsoever lawfully claiming the same or any part thereof.
3. PAYMENT OF SUMS SECURED. Mortgagor shall pay to Mortgagee all
payments required by the Loan Agreement, reasonable charges fixed by
Mortgagee to satisfy and discharge this Mortgage of record, and all other
sums hereby secured.
4. PERFORMANCE OF AGREEMENTS. Mortgagor shall comply in all
material respects with all of Mortgagor's obligations under the Basic
Documents. Mortgagor is not in violation in any material respect of any
term or provision of any mortgage, lease, agreement or other instrument
which is material to its business or assets, or of any judgement, decree or
Laws and Other Governmental Requirements by which it is bound or to which
it or any of its assets is subject. The execution, delivery and
performance of and compliance by Mortgagor with the Basic Documents to
which it is a party will not violate or constitute a default of any term or
provision of any mortgage, lease, agreement or other instrument, or of any
judgement, decree, Governmental Approvals or Laws and Other Governmental
Requirements by which Mortgagor is bound or to which any of its assets is
subject, except that certain Governmental Approvals and similar approvals
or permits necessary for certain aspects of the construction and operation
of the Project have not yet been obtained as of the date hereof; Mortgagor
covenants that as of the date hereof, all permits for the construction and
operation of the Project that customarily are obtained or have been applied
for as of the closing of acquisition and construction financing have been
obtained or applied for; Mortgagor shall obtain such Governmental Approvals
and similar approvals or permits in due course and timely fashion and
hereby covenants to diligently pursue and obtain the same. Mortgagor is
unaware as of the date hereof of any reason why all
Governmental Approvals and similar approvals necessary for the construction
and operation of the Project will not be obtained in timely fashion and in
due course.
5. CONSTRUCTION OF PROJECT; CONSTRUCTION INSPECTOR; PHASE C GARAGE.
From and after the Put Date (as defined in the Loan Agreement), Mortgagor
shall diligently and continuously construct the Project in all material
respects in accordance with the requirements of (a) the Plans, (b)
Governmental Authorities, (c) the Management Agreement, and (d) the Ground
Lease.
All materials used in the Project shall be new, of first-class
quality, and the workmanship shall be first-class in every way. Mortgagor
shall not permit the use in connection with construction of the Project of
any materials, fixtures or equipment (except for Leased Equipment) intended
to become part of the Project which are purchased upon conditional ▇▇▇▇ of
sale or to which Mortgagor does not immediately have absolute and
unencumbered title, and will cause to be paid punctually all sums becoming
due for labor, materials, fixtures, or equipment used or purchased in
connection with such construction.
At the request of Mortgagee, Mortgagor shall cause the Architect to
provide Mortgagee with reports relative to the status of construction of
the Project. Further, at any time during the construction of the Project,
Mortgagor shall, if requested by Mortgagee, comply with such reasonable
requirements as the Construction Inspector may suggest with respect to
construction of the Project. The fees, costs and expenses (including,
without limitation, travel expenses) of the Construction Inspector shall be
borne by Mortgagor, and such fees, costs and expenses shall be paid by
Mortgagor forthwith upon billing therefor. Mortgagee shall have no
liability to Mortgagor on account of (i) the services performed by the
Construction Inspector, (ii) any neglect or failure on the part of the
Construction Inspector properly to perform its services, or (iii) any
approval or disapproval by the Construction Inspector of work on the
Project.
Pursuant to Section 1.6.6 of the Ground Lease, Landlord has certain
rights to construct, at its expense, a garage (the "Phase C Garage" on the
portion of the Leasehold Estate identified in the Ground Lease as the
"Premises Parking Area"; or if Mortgagor constructs the Phase C Garage on
the Premises Parking Area for fewer that 270 cars, Landlord has certain
rights, at its expense, to expand the Phase C Garage to accommodate up to
540 cars (the "Phase C Expansion"). If Landlord elects to build the Phase
C Garage or the Phase C Expansion, the Ground Lease obligates Mortgagor to
release from the Leasehold Estate the Premises Parking Area (or portion
thereof) or the air rights needed for the Phase C Garage or Phase C
Expansion, as the case may be. Mortgagee hereby agrees that upon its
receipt of reasonably
satisfactory evidence from both Mortgagor and Landlord that Landlord is
proceeding with the construction of the Phase C Garage or the Phase C
Expansion, as the case may be, in accordance with Section 1.6.6 of the
Ground Lease, Mortgagee shall release the Premises Parking Area (or portion
thereof) or such air rights, as the case may be, from the lien of this ▇▇▇▇
▇▇▇▇ and shall do, execute acknowledge, deliver and record such instruments
as Landlord may reasonably request to confirm such release; the parties
hereby expressly agree that such release by Mortgagee of the Premises
Parking Area (or portion thereof) or such air rights, shall not require any
consent of the Bondholders (as defined in the Loan Agreement) under Section
1302 (vi) or any other provision of the Loan Agreement.
6. WASTE, MAINTENANCE, COMPLIANCE AND INSPECTION.
Mortgagor, at it sole cost and expense, shall take good care of the
Premises and will keep and maintain the same in good order, condition and
repair, reasonable wear and tear excepted; and make all necessary repairs
thereto, interior and exterior, structural and non-structural, ordinary and
extraordinary, and unforeseen and foreseen. Mortgagor shall abstain from
and not permit the commission of waste in or about the Premises; shall not
remove or demolish any Improvement at any time erected on the Leasehold
Estate without the prior written consent of Mortgagee; shall not remove,
sell or otherwise dispose of any fixture or personal property without the
prior written consent of Mortgagee unless the same shall have become
obsolete or no longer useful or the same shall be replaced or substituted
by fixtures or personal property of like character and equivalent value,
not subject to any encumbrance or security interest and such replacement or
substitution shall be encumbered by this Mortgage; upon completion of
construction of the Project, Mortgagor may, without Mortgagee's approval,
make any alteration or modification to the Project and Improvements
permitted under the Ground Lease and the Management Agreement, provided,
however, that if any such alteration or modification requires the prior
approval of Landlord and/or the Manager, Mortgagor shall have obtained such
approval(s); any other alterations or improvements to the Project and
Improvements shall require Mortgagee's prior written approval, which
approval shall not be unreasonably withheld; and Mortgagor shall comply in
all material respects with, and cause the Project and the operation thereof
to comply in all material respects with, all Governmental Approvals and
Laws and Other Governmental Requirements except for such noncompliance
which, singly or in the aggregate, would not have a material adverse effect
on the Project or its operations; provided however, that if Mortgagor,
without cost or expense or civil or criminal liability to Mortgagee, shall
in good faith, and by proper legal action, contest any such Laws and Other
Governmental Requirements, or the validity thereof, then Mortgagor shall
not be required to comply therewith so long as such contest operates to
prevent enforcement, and is maintained and prosecuted with
diligence, and shall not have been terminated or have been discontinued
adversely to Mortgagor; if Mortgagee, however, determines in its reasonable
opinion that its security hereunder may be materially impaired by reason of
such contest, Mortgagee may require Mortgagor to furnish additional
security reasonably satisfactory to Mortgagee against any loss, injury or
damage that Mortgagee would incur by reason of such contest.
Mortgagor shall permit Mortgagee, the Construction Inspector, and
Mortgagee's other representatives at reasonable times to enter the Project
for the purpose of inspecting the progress of work and materials thereon
and to enable Mortgagee to determine that construction of the Project is
proceeding as required by the terms of this Mortgage. In addition, from
and after the Project Completion Date, Mortgagor shall permit Mortgagee and
its representatives at reasonable times to enter the Project for the
purpose of inspecting to ensure that the Project complies with the terms of
this Mortgage. Mortgagor shall, and shall cause the Architect and the
General Contractor to, cooperate with Mortgagee and the Construction
Inspector, keep Mortgagee and the Construction Inspector fully informed of
the progress of construction of the Project, furnish to Mortgagee and the
Construction Inspector copies of all notices, schedules, reports and daily
logs relating to the progress of construction of the Project reasonably
requested by Mortgagee or the Construction Inspector.
7. INSURANCE. Until the Project Completion Date shall have
occurred, Mortgagor shall cause to be maintained in force builder's risk
completed value (non-reporting) form insurance coverage, including "All
Risk" type coverage and coverage against the perils normally covered by a
special extended coverage endorsement, and explosion, collapse, cost of
demolition, increased cost of construction and the value of the undamaged
portion of the building (all in appropriate standard form for the
Commonwealth of Massachusetts), in an amount not less than Twenty-Five
Million Dollars ($25,000,000) and other endorsements affording protection
against such risks as Mortgagee may reasonably designate. From and after
the Project Completion Date, Mortgagor shall keep the Premises continuously
insured under an "All Risks" property insurance policy against loss by
fire, with extended coverage and against such other hazards as Mortgagee
may reasonably require in an amount equal to the greater of (a) one hundred
(100%) per cent of the full replacement cost of the Improvements on the
Leasehold Estate without deduction for depreciation or; (b) an amount
sufficient to prevent Mortgagee or Mortgagor from becoming a co-insurer
within the terms of the applicable policies. Mortgagor shall also maintain
(i) boiler and machinery insurance in the amount of One Million Dollars
($1,000,000); (ii) business income insurance in the amount of Four Million
Two Hundred Thousand Dollars ($4,200,000); (iii) worker's compensation
insurance, as required
by applicable law; and (iv) comprehensive general liability insurance in
the amount of Six Million Dollars ($6,000,000). The policy or policies
for all such insurance shall contain replacement cost endorsements and
shall be maintained in full force and effect until such time as the
indebtedness hereby secured is fully repaid. All policies, and any
renewals thereof, including but not limited to policies not specifically
required by Mortgagee, shall be with an insurance company or companies, and
in form and substance satisfactory to Mortgagee, and shall be deposited,
premiums paid, with Mortgagee. All renewal policies shall be delivered, by
Mortgagor, premiums paid, to Mortgagee at least ten (10) days before the
expiration of the expiring policies. The insurance company shall agree in
the policy to provide Mortgagee with no less than thirty (30) days prior
written notice before any termination or cancellation becomes effective as
to Mortgagee. If Mortgagee becomes the owner of the Premises or any part
thereof by foreclosure or otherwise, such policies shall become the
absolute property of Mortgagee.
Mortgagor covenants and agrees that if, at any time during the term
of the Mortgage, including any extensions thereof, the area in which the
Leasehold Estate, or any part thereof, is located is designated a "flood
prone" area pursuant to the Flood Disaster Protection Act of 1973, or any
amendments, or supplements thereto, then, in that event, Mortgagor shall
obtain flood insurance in such total amount as Mortgagee may from time to
time require and shall otherwise comply with the National Flood Insurance
Program as set forth in said Flood Disaster Protection Act of 1973, as
amended from time to time. Mortgagor further covenants and agrees to fully
comply with the requirements of the National Flood Insurance Act of 1968
and the Flood Disaster Protection Act of 1973, as the same may be amended
from time to time, and any other law, order, rule, ordinance or regulation
concerning flood insurance, to the extent that the same apply to the
Premises, or any part thereof.
The loss, if any, shall be payable to Mortgagee according to the
terms of a standard mortgagee clause, not subject to contribution, or of
such other form of mortgagee or loss payment clause as shall be
satisfactory to Mortgagee. Mortgagee shall have the right, at its election
to adjust or compromise any loss claims under such insurance in excess of
$1,000,000; any loss claims of less than $1,000,000 may be adjusted or
compromised by Mortgagor. All casualty insurance proceeds shall be applied
as hereinafter set forth:
A. Mortgagor agrees to give immediate notice to the Mortgagee of any
fire, damage or other casualty to all or any part of the Premises. In case
of any fire, damage or other casualty involving a cost of repair of less
than one-tenth of one percent of the replacement cost of the Premises, all
proceeds of any hazard insurance shall be paid to Mortgagor, and Mortgagor
shall forthwith repair or restore that part of the Premises damaged.
B. In case of any damage or destruction to the Project or any other
casualty involving a cost of repair of one-tenth of one percent or more of
the replacement cost of the Premises, all proceeds of any hazard insurance
shall be paid to and deposited with the Mortgagee as "Insurance Trustee"
(as defined in Section 9.2 of the Ground Lease), and Mortgagor shall
neither make nor omit to make any election it is entitled to make under the
Ground Lease without the approval of the Mortgagee, and the following
additional provisions shall apply:
(i) If Mortgagor (with Mortgagee's approval) does not elect
to terminate or has no right to terminate the Ground Lease, all proceeds so
deposited shall be applied to or toward the repair or restoration of that
part of the Premises damaged by the hazard with respect to which insurance
is paid; in such case, Mortgagee shall release such proceeds to the
Mortgagor in accordance with Section 9.2 of the Ground Lease or upon such
different or further reasonable conditions as Mortgagee may prescribe. Any
insurance proceeds remaining after payment of all costs of such repair or
restoration shall, so long as no Event of Default shall have occurred and
be continuing, be paid to Mortgagor; if an Event of Default has occurred
and is continuing at such time, any insurance proceeds so remaining shall
be applied by Mortgagee to redeem Bonds as provided in the Loan Agreement.
If Mortgagee determines that the proceeds are insufficient to pay for the
repair and restoration of the Premises, Mortgagor shall deposit with
Mortgagee sufficient additional funds as Mortgagee determines to be
reasonably necessary to complete such repairs when aggregated with such
insurance proceeds, for disbursement upon such conditions as Mortgagee may
prescribe.
(ii) If Mortgagor (with Mortgagee's approval) elects to
terminate the Ground Lease, or if the Ground Lease is terminated
involuntarily pursuant to its terms, all proceeds of any hazard insurance
shall be applied as follows:
a. FIRST, to the costs of removing any remaining
Improvements and grading the Leasehold Estate in accordance with Section
9.3 of the Ground Lease;
b. SECOND, to be applied by Mortgagee to redeem Bonds
as provided in the Loan Agreement;
c. THIRD, to the payment of all other amounts secured
by This Mortgage, as provided in the Loan Agreement;
d. FOURTH, to Landlord in an amount equal to the sum
which Landlord is entitled to receive under Section 9.3 of the Ground
Lease, calculated as though no insurance proceeds were paid as provided in
the immediately preceding clauses SECOND and THIRD; and
e. FIFTH, balance, if any, to Mortgagor.
(iii) In the event insurance proceeds are released to Mortgagor
for the repair, restoration or replacement of the damaged property and such
proceeds are not sufficient to permit the complete repair, restoration or
replacement of the damaged Premises, Mortgagor shall nevertheless fully
repair, restore or replace the damaged Premises and shall supply any
deficiency in the insurance proceeds with its own funds.
C. Notwithstanding anything in this Paragraph 7 to the contrary,
if the insurer denies liability to Mortgagor, the Mortgagor shall not be
relieved of any obligation under this Paragraph 7 of this Mortgage, whether
or not the proceeds of insurance are applied to or toward the indebtedness
secured hereby.
D. If Mortgagor is entitled by the terms of Sections 9.3 or 9.4 of
the Ground Lease to elect either to restore the Improvements or terminate
the Ground Lease, Mortgagor hereby agrees that in any such circumstances
Mortgagee shall be entitled to elect, on behalf of Mortgagor and as
Mortgagor's attorney-in-fact, coupled with an interest, to terminate the
Ground Lease, unless Mortgagor provides Mortgagee with reasonably
satisfactory evidence that:
(i) sufficient funds (including insurance proceed and any
additional funds to be contributed by Mortgagor) are available to complete
any necessary repair or restoration of the Improvements; and
(ii) Mortgagor has funds of its own (or available to
Mortgagor) or has received commitments for and shall obtain financing
sufficient to pay off the then outstanding Bonds on the maturity date.
8. TAXES AND OTHER CHARGES. Mortgagor shall pay all real estate
taxes, water and sewer rents, excise levies, vault and other license or
permit fees, local taxes, transit taxes, levies and assessments, fines,
fire protection, police protection, and similar charges payable under the
Ground Lease, impositions, and other similar claims and liens assessed, or
which may be assessed, against the Premises or any part thereof, (all such
taxes, water and sewer rent charges, excise levies, vault and other license
or permit fees, local taxes, transit taxes, levies
and assessments, fines, impositions and other similar claims and liens,
together with the utility charges described below being hereinafter
sometimes referred to as "Impositions", and any of the same being
hereinafter referred to as an "Imposition") without any deduction or
abatement, prior to the dates on which such Impositions commence to bear
interest or penalties, and shall, if requested in writing by Mortgagee, not
later that such dates produce to Mortgagee receipts for the payment thereof
in full, and shall pay every other tax, assessment, claim, fine, lien or
encumbrance which may at any time be or become a lien upon the Premises
prior to, or on a parity with, the lien of this Mortgage. If Mortgagor
shall in good faith, and by proper legal action, contest any such
Impositions or other taxes, assessments, claims, fines, liens,
encumbrances, or charges, or the validity thereof, then Mortgagor shall not
be required to pay the same, or to produce such receipts, during the
maintenance of said reserve and as long as such contest operates to prevent
enforcement or collection, and such contest is maintained and prosecuted
with diligence, and shall not have been terminated or discontinued
adversely to Mortgagor; notwithstanding the foregoing provision, Mortgagor
shall not have the right to contest any such Impositions or other taxes,
assessments, claims, fines, liens, encumbrances or charges, if any
Governmental Authority shall threaten to foreclose any lien affecting the
Premises that has arisen because of non-payment any such Impositions or
other taxes, assessments, claims, fines, liens, encumbrances or charges
(unless such threatened foreclosure shall be stayed by a court of competent
jurisdiction), or if in a Mortgagee's reasonable good faith judgment, such
contest would materially adversely threaten Mortgagee's security. In
addition to the foregoing, Mortgagor will pay cause to be paid when due and
will not suffer to remain outstanding, any charges for utilities and refuse
removal, whether public or private, with respect to the Premises.
9. ESCROW FUNDS. Without limiting the effect of Paragraphs 7 and
8 hereof, after an Event of Default has occurred and for so long as such
Event of Default remains uncured (or if more that three Events of Default
have occurred during any consecutive twelve-month period, then for the
twelve-month period following the last to occur of such Events of Default),
at the written election of Mortgagee, Mortgagor shall pay to Mortgagee
monthly at the time when the monthly Loan Payment is payable, an amount
equal to 1/12th of the annual premium for such fire and extended coverage
insurance, other hazard insurance and such annual real estate taxes, water
rents, sewer rents, special assessments, and any other tax, assessment,
claim, lien or encumbrance which may at any time be or become a lien upon
the Premises prior to, or on a parity with, the lien of this Mortgage to
enable Mortgagee to pay same at least thirty (30) days before they become
due, and on demand from time to time shall pay to Mortgagee additional sums
necessary to pay such premiums and other payments, all as estimated by
Mortgagee, the amounts so paid to be security for
such premiums and other payments and to be used in payment thereof. The
amounts so paid shall be deposited in a separate interest-bearing account
with interest payable to Mortgagor. If, pursuant to any provision of the
Loan Agreement, The whole amount of the Loan becomes immediately due and
payable by acceleration or otherwise, Mortgagee shall have the right, at
its election, to apply any amounts so held under this Paragraph 9 against
all or any part of the indebtedness secured hereby or in payment of the
premiums or payments for which the amounts were deposited. Mortgagor will
furnish to Mortgagee tax and insurance bills in sufficient time to enable
Mortgagee (i) to pay such Impositions before interest and penalties accrue
thereon and (ii) to pay the insurance premiums before the policies lapse.
10. SECURITY AGREEMENT; ADDITIONAL SECURITY. This Mortgage creates
a security interest in all personal property included in the Premises, from
time to time, and constitutes a security agreement under the Massachusetts
Uniform Commercial Code. Mortgagor, at its expense, shall execute, file
and refile such financing statements or other security agreements as
Mortgagee shall require from time to time with respect to personal property
included in the Premises.
Nothing contained in this Paragraph 10 shall be construed, in any way
to include any personal property of any subtenant pursuant to any
subleases, or any personal property of the Manager, or any Leased Equipment
within Mortgagee's security interest, as discussed in this Paragraph 10,
except (i) by operation of law, or (ii) in the event of the abandonment of
such personal property by any subtenant or by Manager or any equipment
lessor.
If any portion of the Loan proceeds are to be used for payment of any
item of tangible personal property which, as of the date of such payment,
has not been delivered to the Premises, Mortgagor shall provide Mortgagee
with notice thereof as early as practicable prior to requesting
disbursement of any portion of Loan proceeds for payment for such item and,
upon the request of Mortgagee, Mortgagor, at its expense, shall make,
execute, deliver, file and record, or cause to be made, executed,
delivered, filed and recorded, any and all instruments, certificates and
other documents and shall take all such further action as may be necessary
or desirable in order to effectuate, complete, enlarge, confirm and/or
perfect the lien and security interest of Mortgagee in such item of
property hereunder.
11. GROUND LEASE; SUBLEASES.
A. With respect to the Ground Lease, Mortgagor covenants and
agrees as follows:
(i) Mortgagor will pay all rent and other charges required
under the Ground Lease as and when the same are due and Mortgagor will
keep, observe and perform, or cause to be kept, observed and performed, all
of the other terms, covenants, provisions and agreements of the Ground
Lease on the part of the lessee thereunder to be kept, observed and
performed, and will not in any manner, cancel, terminate or surrender or
permit any cancellation, termination or surrender of the Ground Lease, in
whole or in part, or, without the written consent of Mortgagee, either
orally or in writing, modify, amend or permit any modification or amendment
of any of the terms thereof in any respect, and any attempt on the part of
Mortgagor to exercise any such right without such written consent of
Mortgagee shall not be binding on Mortgagee if Mortgagee succeeds to the
interest of the Landlord under the Ground Lease.
(ii) Mortgagor will do, or cause to be done, any things
necessary to preserve and keep unimpaired the right of Mortgagor as tenant
under the Ground Lease, and to prevent any substantial or material default
under the Ground Lease, or any termination, surrender, cancellation,
forfeiture or impairment thereof, and in the event of the failure of
Mortgagor to make any payment required to be made by Mortgagor pursuant to
the provisions of the Ground Lease or to keep, observe or perform, or cause
to be kept, observed or performed, any of the substantial or material
terms, covenants, provisions or agreements of the Ground Lease, Mortgagor
agrees that Mortgagee may (but shall not be obligated to) take any action
on behalf of Mortgagor, to make or cause to be kept, observed or performed
any such terms, covenants, provisions or agreements and to enter upon the
Premises and take all such action thereof as may be necessary therefor, to
the end that the rights of Mortgagor in and to the Leasehold Estate shall
be kept unimpaired and free from default, and all money so expended by
Mortgagee, with interest thereon at the Involuntary Rate shall be paid by
Mortgagor to Mortgagee promptly upon demand by Mortgagee and shall be added
to the indebtedness and secured by this Mortgage and Mortgagee shall have,
in addition to any other remedy of Mortgagee, the same rights and remedies
in the event of non-payment of any such sum by Mortgagor as in the case of
a default by Mortgagor in the payment of any sums due under the Loan
Agreement.
(iii) Mortgagor will use reasonable efforts to enforce the
obligations of the Landlord under the Ground Lease to the end that
Mortgagor and Mortgagee may enjoy all of the rights granted to them,
respectively under the Ground Lease, and will promptly notify Mortgagee in
writing of any substantial or material default by the Landlord or by
Mortgagor in the performance or observance of any of the
terms, covenants and conditions on the part of the Landlord or
Mortgagor, as the case may be, to be performed or observed under the Ground
Lease and Mortgagor will promptly advise Mortgagee in writing of the
occurrences of any substantial or material default under the Ground Lease
and of the giving of any notice by the Landlord to Mortgagor of any default
by Mortgagor in performance or observance of any of the substantial or
material terms, covenants or conditions of the Ground Lease on the part of
Mortgagor to be performed or observed and will deliver to Mortgagee a true
copy of each notice.
(iv) If any action or proceeding shall be instituted to evict
Mortgagor or to recover possession of the Premises or for any other purpose
affecting the Ground Lease or this Mortgage, Mortgagor will, immediately
upon service thereof on or to Mortgagor, deliver to Mortgagee a true copy
of each petition, summons, complaint, notice or motion, order to show cause
and of all other provisions, pleadings, and papers, however designated,
served in any such action or proceeding.
(v) Mortgagor covenants and agrees that unless Mortgagee
shall otherwise expressly consent in writing, the fee title to the property
demised by the Ground Lease and the Leasehold Estate shall not merge but
shall always remain separate and distinct, notwithstanding the union of
said estates either in the Landlord, Mortgagor, or a third party by
purchase or otherwise; and in case Mortgagor acquires the fee title or any
other estate, title or interest in the Premises, this Mortgage shall attach
to and cover and be a lien upon the fee title or such other estate so
acquired, and such fee title or other estate shall, without further
assignment, mortgage or conveyance, become and be subject to the lien of
and covered by this Mortgage.
(vi) No release or forbearance of any of Mortgagor's
obligations under the Ground Lease, pursuant to the Ground Lease, or
otherwise, shall release Mortgagor from any of its obligations under this
Mortgage, including its obligation with respect to the payment of rent as
provided for in the Ground Lease and the performance of all of the terms,
provisions, covenants, conditions and agreements contained in the Ground
Lease, to be kept, performed and complied with by Mortgagor as tenant
therein.
(vii) The lien of this Mortgage shall attach to all of
Mortgagor's rights and remedies at any time arising under or pursuant to
Subsection 365(h) of the Bankruptcy Code, 11 U.S.C. Section 365(h),
including, without limitation, all of Mortgagor's rights to remain in
possession of the Premises.
Mortgagor shall not, without Mortgagee's prior written consent, elect
to treat the Ground Lease as terminated under Subsection 365(h) (1) of the
Bankruptcy Code, 11 U.S.C. Section 365(h) (1). Any such election made
without Mortgagee's consent shall be void.
Mortgagor hereby unconditionally assigns, transfers and sets over to
Mortgagee all of Mortgagor's claims and rights to the payment of damages
arising from any rejection of the Ground Lease by Landlord or any other fee
owner of the Premises under the Bankruptcy Code. Mortgagee shall have the
right to proceed in its own name or in the name of Mortgagor in respect of
any claim, suit, action or proceeding relating to the rejection of the
Ground Lease, including, without limitation, the right to file and
prosecute, any proofs of claim, complaints, motions, applications, notices
and other documents, in any case in respect to the Landlord or any fee
owner under the Bankruptcy Code. Unless an Event of Default shall have
occurred and be continuing, Mortgagor shall be entitled to join with
Mortgagee in such proceedings, provided, however, that in doing so
Mortgagor shall take no actions which are adverse to the interests of
Mortgagee. This assignment constitutes a present, irrevocable and
unconditional assignment of the foregoing claims, rights and remedies, and
shall continue in effect until all of the obligations secured by this
Mortgage shall have been satisfied and discharged in full. Any amounts
received by Mortgagee as damages arising out of the rejection of the Ground
Lease as aforesaid shall be applied first to all costs and expenses of
Mortgagee (including, without limitation, reasonable attorneys' fees)
incurred in connection with the exercise of any of its rights or remedies
under this section.
If pursuant to Subsection 365(h) (2) of the Bankruptcy Code, 11
U.S.C. Section 365(h) (2), Mortgagor shall seek to offset against the rent
reserved in the Ground Lease the amount of any damages caused by the
nonperformance by the Landlord or any fee owner of their obligations under
the Ground Lease after the rejection by the Landlord or any fee owner of
the Ground Lease, under the Bankruptcy Code, Mortgagor shall, prior to
effecting such offset, notify Mortgagee of its intent to do so, setting
forth the amounts proposed to be so offset and the basis therefor.
Mortgagee shall have the right to object to all or any part of such offset
that, in the reasonable judgment of Mortgagee, would constitute a breach of
the Ground Lease, and in the event of such objection, Mortgagor shall not
effect any offset of the amounts so objected to by Mortgagee. Neither
Mortgagee's failure to object as aforesaid nor any objection relating to
such offset shall constitute an approval of any such offset by Mortgagee.
Mortgagor shall pay and protect Mortgagee,
and indemnify and save Mortgagee harmless from and against, any and all
claims, demands, actions, suits, proceedings, damages, losses, costs and
expenses of every nature whatsoever (including, without limitation,
reasonable attorneys' fees) arising from or relating to any offset by
Mortgagor against the rent reserved in the Ground Lease.
If any action, proceeding, motion or notice shall be commenced or
filed in respect of the Landlord or any fee owner, the Premises or the
Ground Lease in connection with any case under the Bankruptcy Code,
Mortgagee shall have the option, exercisable by notice from Mortgagee to
Mortgagor, to conduct and control any such litigation with counsel of
Mortgagee's choice. Mortgagee may proceed in its own name or in the name
of Mortgagor in connection with any such litigation, and Mortgagor agrees
to execute any and all powers, authorizations, consents or other documents
required by Mortgagee in connection therewith. Mortgagor shall, upon
demand, pay to Mortgagee all costs and expenses (including reasonable
attorneys' fees) paid or incurred by Mortgagee in connection with the
prosecution or conduct of any such proceedings. Any such costs or expenses
not paid by Mortgagor as aforesaid shall be secured by the lien of this
Mortgage and shall be added to the indebtedness secured hereby. Unless an
Event of Default shall have occurred and be continuing, Mortgagor shall be
entitled to join with Mortgagee in such proceeding, provided, however, that
in doing so Mortgagor shall take no actions which are adverse to the
interests of Mortgagee. Mortgagor shall not commence any action, suit,
proceeding or case, or file any application or make any motion, in respect
of the Ground Lease in any such case under the Bankruptcy Code without the
prior written consent of Mortgagee, which consent shall not be unreasonably
withheld or delayed.
Mortgagor shall, after obtaining knowledge thereof, promptly notify
Mortgagee of any filing by or against the Landlord or other fee owner of a
petition under the Bankruptcy Code. Mortgagor shall promptly deliver to
Mortgagee, following receipt, copies of any and all notices, summonses,
pleadings, applications and other documents received by Mortgagor in
connection with any such petition and any proceedings relating thereto.
If there shall be filed by or against Mortgagor a petition under the
Bankruptcy Code and Mortgagor, as lessee under the Ground Lease, shall
determine to reject the Ground Lease pursuant to Section 365(a) of the
Bankruptcy Code, Mortgagor shall give Mortgagee not less than thirty (30)
days' prior notice of the date on which Mortgagor shall apply to the
Bankruptcy Court for authority to reject the Ground Lease. Mortgagee shall
have the right, but not the
obligation, to serve upon Mortgagor within such thirty (30) day period a
notice stating that Mortgagee demands that Mortgagor assume and assign the
Ground Lease to Mortgagee pursuant to Section 365 of the Bankruptcy Code.
If Mortgagee shall serve upon Mortgagor the notice described in the
preceding sentence, Mortgagor shall not seek to reject the Ground Lease and
shall comply with the demand provided for in the preceding sentence.
B. Mortgagor will comply with and observe its obligations as
sublandlord under all Subleases. Mortgagor may, from time to time, without
the prior approval of Mortgagee, enter into Subleases related to the
operation of the Project as a first-class hotel and conference center;
Mortgagor may also cancel, surrender, or modify any such Subleases without
Mortgagor's approval. If Mortgagor wishes to enter into any Sublease that
is unrelated ("Unrelated Sublease") to the operation of the Project as
aforesaid, Mortgagor shall obtain Mortgagee's prior written consent
thereto, which consent shall not be unreasonably withheld. Any Unrelated
Sublease shall, as provided in the Ground Lease, provide that rental
adjustments shall be made no less frequently than once every ten years to
assure that rental shall be adjusted to at least 95% of the then market
rate. No Unrelated Sublease shall be canceled, surrendered, or modified in
any material way without the prior written consent of Mortgagee, which
consent shall not be unreasonably withheld. Prior to entering into any
Sublease, Mortgagor shall -- to the extent required under the Ground Lease
-- obtain the approval of Landlord thereto. Mortgagor shall notify
Mortgagee immediately of any material or substantial default asserted by
any subtenant under any Sublease. If Mortgagee fails to cure such default
on its part, as sublandlord under any such Sublease, then Mortgagor
expressly authorizes Mortgagee, at its option, to cure such default in
order to prevent termination of any such Sublease by any such subtenant,
and the Subleases shall set forth the foregoing provisions. Mortgager upon
request, from time to time, but not more often than annually unless a
default shall have occurred under this Mortgage, will furnish to Mortgagee
in such reasonable detail as Mortgagee may request, certified by Mortgagor,
copies of all Subleases; and on demand, Mortgagor will furnish to Mortgagee
executed counterparts of any and all Subleases.
Mortgagor agrees that it has not as of the date hereof and will not,
without the written consent of Mortgagee, assign the rents, issues or
profits, or any part thereof, from the Premises, receive or collect rents
from any tenant, subtenant, undertenant, or other occupant of any part of
the Premises for a period of more than one (1) month in advance.
Mortgagor authorizes Mortgagee at its option to foreclose this
Mortgage subject to the right of any subtenants of the
Premises and subject to the Manager's rights under the Subordination
Agreement, and the failure to make the Manager or any such subtenants
parties defendant to any such foreclosure proceeding and to foreclose their
rights will not be asserted by Mortgagor as a defense to any proceeding
instituted by Mortgagee to collect the indebtedness secured hereby or any
deficiency remaining unpaid after the foreclosure sale of the Premises, it
being expressly understood and agreed, however, that nothing herein
contained shall prevent Mortgagor from asserting in any proceeding
disputing the amount of the deficiency or the sufficiency of any bid at
such foreclosure sale, that any such subtenancies adversely affect the
value of the Premises.
At the sole option of Mortgagee, this Mortgage shall become subject
and subordinate, in whole or in part (but not with respect to priority
entitlement to any award in condemnation), to any and all Subleases upon
the execution by Mortgagee and recording thereof, at any time hereinafter,
in the office of the recording of such documents for the locality in which
the Premises are located, of a unilateral declaration to that effect.
All Subleases shall provide for the giving by the subtenant of
certificates with respect to the status of such Subleases. Mortgagor shall
exercise its right to request such certificates within thirty (30) days of
any demand therefor by Mortgagee.
12. RIGHT TO REMEDY DEFECTS. If Mortgagor fails to pay when due
any tax, claim, lien, or encumbrance which shall be or become prior to, or
on a parity with, the lien of this Mortgage, or to pay when due any
insurance premium as aforesaid, or to pay when due any rent or other
charges payable under the Ground Lease or to pay when due any utility or
refuse removal ▇▇▇▇ for services rendered to the Premises or to keep the
Premises in repair, as aforesaid, or commits or permits waste or fails to
perform or observe any term, agreement, provision, covenant or condition
under this Mortgage, and if any such failure continues for thirty (30) days
after notice thereof from Mortgagor, then Mortgagee, at its option (except
in emergencies [i.e., situations in which the failure of Mortgagor to have
made any such payment would immediately jeopardize or adversely affect
Mortgagee's security], in which cases Mortgagor may act immediately if
necessary and without prior written notice to Mortgagor, in any such case
Mortgagor shall endeavor to give Mortgagee prior notice (which may be oral)
and shall in any event subsequently give Mortgagor written notice), may pay
said claim, lien, encumbrance, tax, assessment or premium, with right of
subrogation thereunder, may make such repairs and take such steps as it
deems advisable to prevent or cure such waste, and may commence or appear
in any action or proceeding with respect to any of the foregoing and retain
counsel therein, and take such action therein as Mortgagee deems advisable.
Mortgagee is hereby empowered to enter and to authorize others to enter
upon the Premises or any part thereof
for the purpose of performing or observing any such defaulted term,
agreement, provision, covenant or condition without thereby becoming liable
to Mortgagor or any person in possession under Mortgagor. For any of said
purposes, Mortgagee may advance such sums of money as it deems necessary.
Mortgagor will pay to Mortgagee, immediately and without demand, all sums
of money advanced by Mortgagee pursuant to this Paragraph 11 and until
paid, all such sums shall be added to the principal secured hereby and
shall bear interest at the Involuntary Rate from the date of payment, and
the same shall be secured by this Mortgage.
13. CONDEMNATION. If all, or any part of, the Premises is damaged
or taken through condemnation, temporarily or permanently, all proceeds to
which Mortgagor is entitled under the Ground Lease shall be applied as set
forth in this Paragraph 13. Mortgagee is hereby authorized, at its option,
to commence, appear in and prosecute, jointly with Mortgagor, any action or
proceeding relating to any such condemnation except for Excluded Damages,
and to settle or compromise any claim in connection therewith. Mortgagee
shall not settle or compromise any claim in connection with any damage or
taking through condemnation without the prior written consent of Mortgagor,
which consent shall not unreasonably be withheld. Mortgagor is entitled to
commence, appear in, and prosecute in its name, any action proceeding in
connection with the Excluded Damages, to settle or compromise any claim in
connection therewith, and to receive and retain any proceeds reserved on
account thereof. The proceeds or awards (other than Excluded Damages) from
any taking or eminent domain proceeding or claim shall be paid to Mortgagee
and applied as follows:
(a) In the event of a taking that results in a termination of
the Ground Lease pursuant to Section 10.1 of the Ground Lease, the proceeds
shall be applied as follows:
(i) FIRST, to be applied by Mortgagee to redeem Bonds
as provided in the Loan Agreement;
(ii) SECOND, to the payment of all other amounts secured
by the Mortgage as provided in the Loan Agreement;
(iii)THIRD, to Landlord an amount equal to the sum which
Landlord is entitled to receive under Section 10.1(b) of the Ground Lease,
calculated as though no payment of eminent domain proceeds were made as
provided in the immediately preceding clauses FIRST and SECOND; and
(iv) FOURTH, the balance, if any, to Mortgagor.
If the amount of an initial award of damages in such case is
insufficient to pay the amount of the indebtedness secured by this Mortgage
in full costs, Mortgagee shall have the right as aforesaid to file an
appeal or such other legal proceedings as its legal counsel may advise to
be appropriate under the circumstances in the name of Mortgagor or of
Mortgagee (for which action Mortgagee or such counsel as it chooses is
hereby irrevocably appointed attorney in fact for Mortgagor) and to
prosecute same to final conclusion or otherwise dispose thereof, in which
event the expenses of the appeal or other appropriate legal proceedings,
including, but not limited to, counsel fees, shall be first paid out of the
proceeds, and no credit shall be given on account of the Mortgage debt
other than a credit for the amount, if any, whereby the final proceeds
exceed all such expenses.
(b) In the event of a taking of only a portion of the
Premises that constitutes a partial taking under Section 10.2 of the Ground
Lease and that does not result in a termination of the Ground Lease, the
proceeds shall be applied:
(i) FIRST to or toward the repair or restoration of the
Premises in accordance with Paragraph 7B. (i) of this Mortgage; and
(ii) SECOND, the balance, if any, shall be applied in
the priority provided in the preceding Paragraph 13 (a) (iii) and (iv).
(c) In the event of a taking of only a portion of the
Premises that nevertheless results in Mortgagor exercising its rights under
Section 10.2 of the Ground Lease to terminate the Ground Lease, the
proceeds shall be applied as follows:
(i) FIRST, to payment of the cost of removing any
remaining Improvements and grading the Leasehold Estate as provided in
Section 10.2 of the Ground Lease; and
(ii) SECOND, in the priority provided in the preceding
▇▇▇▇▇▇▇▇▇ ▇▇ (▇) (▇), (▇▇), (▇▇▇) and (iv).
Nothing in this Paragraph 13 or elsewhere in this Mortgage shall limit
rights otherwise available at law or in equity to Mortgagee, including but
not limited to rights to intervene as a party to any condemnation
proceeding. In the case of any taking covered by the provisions of this
Paragraph, Mortgagee (to the extent that Mortgagee has not been reimbursed
therefor by Mortgagor) shall be entitled as a first priority to
reimbursement
out of any award or awards for all reasonable costs, fees, reimbursements
to Mortgagee and expenses incurred in the determination and collection of
any such awards.
If Mortgagor is entitled by the terms of Section 10.2 of the Ground
Lease to elect either to restore the Improvements or terminate the Ground
Lease, Mortgagor hereby agrees that in any such circumstance Mortgagee
shall be entitled to elect, on behalf of Mortgagor and as Mortgagor's
attorney-in-fact, coupled with an interest, to terminate the Ground Lease,
unless Mortgagor provided Mortgagee with reasonably satisfactory evidence
that:
(i) sufficient funds (including taking proceeds and any
additional funds to be contributed by Mortgagor) are available to complete
any necessary repair or restoration of the Improvements; and
(ii) Mortgagor has funds of its own (or available to
Mortgagor) or has received commitments for and shall obtain financing
sufficient to pay off the then outstanding Bonds on the maturity date.
14. EVENTS OF DEFAULT. The following shall constitute an event or
events of default (singularly an "Event of Default" and collectively
"Events of Default") under this Mortgage:
A. The failure of Mortgagor to make any payment provided for under
the terms of this Mortgage within twenty (20) business days after receipt
of written notice of such failure from Mortgagee, unless a different grace
period with respect to any such payment is explicitly provided for in any
other Basic Document, in which case such different grace period shall
apply;
B. The failure of Mortgagor to perform or observe any term,
provision, covenant, condition or agreement in the Collateral Assignments
or in this Mortgage not involving the payment of money, which failure is
not cured within forty-five (45) days after written notice of such failure
from Mortgagee, except in the event such failure is of a nature that it
cannot reasonably be cured within such forty-five (45) day period, then
Mortgagor must promptly commence to cure such failure upon notice of same
and diligently pursue completion;
C. The existence of any Event of Default under the Loan Agreement;
D. The existence of any Event of Default under the Disbursement
Agreement;
E. The existence of any Event of Default under the Ground Lease;
or
F. The existence of any Event of Default under the Construction
Guaranty.
15. REMEDIES. Upon the occurrence and continuation of any one or
more Events of Default, Mortgagee may, at it option, exercise any remedies
available under the Basic Documents and also forthwith undertake any one or
more of the following:
A. Foreclosure. Institute an action of mortgage foreclosure, or
take such other action as the law may allow, at law or in equity, for the
enforcement thereof and realization on the mortgage security or any other
security which is herein or elsewhere provided for, and proceed thereon to
final judgment and execution thereon for the entire unpaid indebtedness
under the Loan Agreement, with interest at the rate stipulated in the Loan
Agreement, together with all other sums secured by this Mortgage, all costs
of suit, interest at the Involuntary Rate on any judgment obtained by
Mortgagee from and after the date of any Sheriff's sale of the Premises
(which may be sold in one parcel or in such parcels, manner or order as
Mortgagee shall elect) until actual payment is made by the Sheriff of the
full amount due Mortgagee, and reasonable attorney's fees, without further
stay, any law, usage or custom to the contrary notwithstanding;
B. Entry. Enter into possession of the Premises, with or without
legal action; operate, manage or lease the same, collect all rents, issues
and profits therefrom and, after deducting all costs of collection and
administration expense, apply the net rents, issues and profits to the
payment of taxes, water and sewer rents, charges and claims, insurance
premiums and all other carrying charges (including but not limited to
agents' compensation and reasonable fees and costs of counsel and
receivers) and to the maintenance, repair and restoration of the Premises,
or on account and in reduction of the principal or interest hereby secured,
in such order and amounts as Mortgagee in Mortgagee's sole discretion may
elect;
C. Receivership. Have a receiver appointed to enter into
possession of and to operate the Premises, collect the rents, issues and
profits therefrom and apply the same as the court may direct. Mortgagee
shall be entitled to the appointment of a receiver without the necessity of
proving either the inadequacy of the security or the insolvency of
Mortgagor of any other person who may be legally or equitably liable to pay
moneys secured hereby and Mortgagor and each such person shall be deemed to
have waived such proof and to have consented to the appointment of such
receiver. Should Mortgagee or any receiver collect rents, issues or
profits from the Premises, to the extent that the moneys so collected may
be used for payment of the debt, nor can they be used to cure the default,
without the prior written consent of Mortgagee. Mortgagee shall be liable
to
account only for rents, issues and profits actually received by Mortgagee.
D. Exercise the Statutory Power of Sale.
E. Exercise any other remedy available at law or in equity or
expressly provided elsewhere in this Mortgage.
16. ASSIGNMENT OF SUBLEASES AND RENTS AFTER DEFAULT. As further
security for payment of the indebtedness and performance of the
obligations, covenants and agreements secured hereby, Mortgagor hereby
assigns to Mortgagee all subleases already in existence and to be created
in the future, together with all Rents and Profits. This assignment,
however, shall be operative only in the event of the occurrence of an Event
of Default hereunder, or under the Loan Agreement of any other instrument
given as collateral security for the obligation secured hereby, remaining
uncured at the expiration of the grace period, if any, provided herein in
respect of such an Event of Default; and in any such case Mortgagor hereby
confers on Mortgagee the exclusive power, to be used or not in its sole
discretion, to act as agent, or to appoint a third person to act as agent
for Mortgagor, with power to take possession of, and collect the Rents and
Profits and apply such Rents and Profits, at the option of Mortgagee, to
the payments of the mortgage debt, taxes, costs of maintenance, repairs,
expenses incident to managing and other expenses, in such order of priority
as Mortgagee may in its sole discretion determine, and to turn any balance
remaining over to Mortgagor; but such collection of the Rents and Profits
shall not operate as an affirmance of the tenant or lease in the event
Mortgagor's title to the Premises should be acquired by Mortgagee.
Mortgagee shall be liable to account only for the Rents and Profits
actually received by Mortgagee. In exercising any of its powers contained
in this Paragraph 16, Mortgagee may also take possession of, and for these
purposes use, any and all personal property contained in or on the Premises
and used by Mortgagor in the operating, rental of leasing thereof or any
part thereof.
17. COUNSEL FEES. If Mortgagee becomes a party (by intervention or
otherwise) to any action or proceeding affecting, directly or indirectly,
Mortgagor, Mortgagee, the Premises or the title thereto or Mortgagee's
interest under this Mortgage, or employs an attorney to collect any of the
indebtedness or to enforce performance of the obligations, covenants and
agreements secured hereby, Mortgagor shall reimburse Mortgagee, forthwith
upon written notice and without further demand, for all reasonable costs,
charges and reasonable attorney's fees incurred by Mortgagee, in any such
case, whether or not suit be commenced, and, if not paid in full
immediately, the same shall be added to the principal sum secured hereby as
a further charge and lien upon the Premises and shall bear interest at the
Involuntary Rate.
18. NOTICE. All notices, demands, requests and consents permitted
or required under this Mortgage, shall be in writing and shall be given or
served in the manner specified for the giving of notices set forth in the
Loan Agreement.
19. CUMULATIVE RIGHTS AND REMEDIES. The rights and remedies of
Mortgagee as provided in this Mortgage, or in the other Basic Documents
shall be cumulative and concurrent, and may be pursued singly, successively
or together at the sole discretion of Mortgagee, and may be exercised as
often as occasion therefor shall occur; and the failure to exercise any
such right or remedy shall in no event be construed as a waiver or release
of the same.
20. WAIVER OF DEFENSES AND CERTAIN NOTICES. Mortgagor hereby
waives and releases (a) all errors, defects, and imperfections in any
proceedings instituted by Mortgagee under this Mortgage, (b) all benefits
that might accrue to Mortgagor by virtue of any present or future laws
exempting the Premises, or any part of the proceeds arising from any sale
thereof, from attachment, levy or sale under execution, or providing for
any stay of execution, exemption from civil process, or extension of time
for payment, and (c) all notices not specifically required by the Loan
Agreement and this Mortgage, of Mortgagor's default or of Mortgagee's
exercise, or election to exercise, any option under this Mortgage.
Mortgagor agrees that time is of the essence in the performance of the
obligations of Mortgagor under this Mortgage.
21. SATISFACTION OF THIS MORTGAGE. Upon the termination of the
lien of the Loan Agreement in accordance with Section 10.3 thereof, then
and from thenceforth this Mortgage, and the estate hereby granted, shall
cease and become void.
22. BOOKS, RECORDS AND ACCOUNTS. Mortgagor will keep and maintain
or will cause to be kept and maintained proper and accurate books, records
and accounts reflecting all items of income and expense in connection with
the operation of the Premises or in connection with any services, equipment
or furnishings provided in connection with the operation of the Premises,
whether such income or expenses be realized by Mortgagor or by any other
person or entity whatsoever excepting any tenants unrelated to and
unaffiliated with Mortgagor, and who leased from Mortgagor portions of the
Premises for the purposes of occupying the same. Mortgagee shall have the
right from time to time at all times during normal business hours to
examine such books, records and accounts at the office of Mortgagor, or
other person or entity maintaining such books, records and accounts and to
make copies or extracts thereof as Mortgagee shall desire. Mortgagor shall
deliver or cause to be delivered to Mortgagee, within 180 days after the
end of each fiscal year, its annual report with respect to the Project,
containing a balance sheet as
at the end of such fiscal year, a statement of income for such fiscal year,
and a statement of cash flow or of sources and uses of funds all in
reasonable detail and in accordance with generally accepted accounting
principles consistently applied; such statements shall be certified as to
accuracy by Mortgagor's chief financial officer and certified by an
independent certified accountant.
23. MANAGEMENT AGREEMENT. Mortgagor hereby represents to Mortgagee
that it is in full compliance with its obligations under the Management
Agreement, that the Manager has performed in all material respects its
obligations thereunder to the extent any such obligations have accrued as
of this date, that the Manager has asserted no claim of default thereunder
on the part of Mortgagor, and the Mortgagor is in compliance in all
material respects with Mortgagor's obligations to the extent such
obligations thereunder as of this date. To the best of Mortgagor's
knowledge, as of the date of this Mortgage, there are no events which, with
the passage of time, the giving of notice, or both, would constitute a
material default on the part of either Mortgagor or Manager under the
Management Agreement.
Mortgagor agrees to perform all the terms, covenants, provisions and
conditions required to be performed and observed by Mortgagor under the
Management Agreement, to the end that all things shall be done which are
necessary to keep unimpaired Mortgagor's rights under the Management
Agreement and otherwise to keep the Management Agreement in full force and
effect for its initial term.
Any exercise by Mortgagee of its rights and remedies available
hereunder on account of an Event of Default shall be subject to the rights
of the Manager under the Subordination Agreement.
24. TRANSFERS OF THE PROJECT, ETC. Prior to the Project Completion
Date, Mortgagor shall not, without the prior written consent of Mortgagee,
directly or indirectly, except for Permitted AEW Transfers, Permitted
Transfers, Parity Indebtedness and Subordinate Indebtedness: (i) convey,
transfer, assign, encumber, mortgage, pledge or sell the Project or the
Site, or any part thereof, or any interest therein; (ii) transfer, sell or
otherwise dispose of the Mortgagor's interest in the Project or the Site,
or any part thereof; (iii) pledge or encumber any interest in the
Mortgagor; or (iv) make any change in the partners of, or the partnership
interests in, Mortgagor from those on the date hereof. From and after the
Project Completion Date, Mortgagor may, without the approval of Mortgagee
but subject to any approvals required from Landlord under the Ground Lease
or Manager under the Management Agreement, convey, transfer, assign,
encumber, mortgage, pledge, or sell the Project, the Site or Leasehold
Estate, or any part
thereof and any interest herein, may assign, transfer, pledge or encumber
any interest in Mortgagor, and may make any change in the partners of,
and/or partnership interests in, Mortgagor.
25. ESTOPPEL AFFIDAVITS. Each party, within ten (10) days after
written request from the other party, shall furnish a written statement of
the status of any matter reasonably pertaining to this Mortgage or the
Project.
26. INVALID PROVISIONS TO AFFECT NO OTHERS. In case any one or
more of the covenants, agreements, conditions, terms or provisions
contained in this Mortgage shall be invalid, illegal or unenforceable in
any respect, the validity of the remaining covenants, conditions,
agreements, terms or provisions contained herein shall be in no way
affected, prejudiced or disturbed thereby.
27. CAPTIONS. The captions herein are inserted only for
convenience of reference and in no way define, limit or describe the scope
or intent of this Mortgage or any particular paragraph or section hereof,
nor the proper construction hereof.
28. FURTHER ASSURANCES. At any time, and from time to time, upon
request by Mortgagee, Mortgagor will make, execute, acknowledge and deliver
or cause to be made, executed, acknowledged and delivered to Mortgagee any
and all other further instruments, mortgages, conveyances, deeds,
certificates, and other documents as may, in the opinion of Mortgagee be
necessary, or desirable in order to effectuate, complete, confirm, or
perfect or to continue and preserve the obligations of Mortgagor under any
of the Basic Documents and the lien of this Mortgage and any other
instrument given as collateral security therefor. Upon failure by
Mortgagor so to do. Mortgagee may make, execute and record any and all such
instruments, certificates and documents for and in the name of Mortgagor
and Mortgagor hereby irrevocably appoints Mortgagee the agent and attorney-
in-fact of Mortgagor so to do. Mortgagor agrees to pay all filing,
registration and recording fees and all federal state, county and municipal
stamp taxes or other duties, imposts, assessments and charges on all such
instruments, certificates and documents.
29. NOTICE TO MECHANICS AND MATERIALMEN. Nothing in this Mortgage
contained shall be deemed or construed in any way as constituting the
consent or request of Mortgagee, express or implied, by inference or
otherwise, to any contractor, subcontractor, laborer or materialman for the
performance of any labor or the furnishing of any materials for any
specific improvement, alteration to, or repair of, the Premises, or any
part thereof. Mortgagor will cause to be removed, all claims and demands
of mechanics, materialmen, laborers, and others which, if unpaid, might
result in, or permit the creation of, a lien on the Leasehold Estate and/or
the Premises, or any part thereof, or on
the revenues, rents, issues, income and profits arising therefrom, and, in
general, will do, or cause to be done, everything necessary so that the
lien hereof shall be fully preserved, at the cost of Mortgagor, without
expense to Mortgagee.
30. RECORDED INSTRUMENTS. Mortgagor will comply in all material
respects with all of the terms, covenants and conditions of all instruments
of record affecting the Premises, non-compliance with which may materially
affect the security of this Mortgage, or which may impose any duty or
obligation upon Mortgagor or any tenant, subtenant or other occupant of the
Premises, or any part thereof, and Mortgagor shall do or cause to be done
all material things necessary to preserve intact and unimpaired any and all
easements, appurtenances and other interest and rights in favor of, or
constituting, any portion of the Premises. Mortgagor shall not initiate,
join in or consent to any change in any private restrictive covenant,
zoning ordinance, or other public or private restrictions limiting or
defining the uses which may be made of the Premises, or any part thereof.
31. USE. Mortgagor agrees that it shall at all times after the
Project Completion Date cause the Premises to be used, occupies, managed
and operated as a conference center and hotel in accordance with a "first-
class hotel standard" and otherwise in accordance in all material respects
with the Ground Lease; Mortgagor shall not be in default under this
Mortgage for any failure to comply with the immediately foregoing provision
when prevented from doing so by reason of fire, casualty, trucking,
strikes, labor troubles, conditions of supply and demand, or any similar or
dissimilar cause whatsoever beyond Mortgagor's reasonable control (but not
for failure to perform caused by Mortgagor's inability to pay or caused by
financial or market economic conditions generally). In no event shall
Mortgagor use or permit the use of the Premises or any part thereof for any
illegal or immoral purposes.
32. SUCCESSORS AND ASSIGNS. All of the grants, covenants, terms,
agreements, provisions and conditions herein shall run with the Leasehold
Estate and shall apply to, bind and inure to the benefit of, the successors
and assigns of Mortgagor and the successors and assigns of Mortgagee.
33. GOOD STANDING. Mortgagor represents and covenants that (i) it
is a limited partnership duly organized, existing and in good standing
under the laws of the Commonwealth of Massachusetts and (ii) it has the
power, authority and legal right to carry on the business now being
conducted by it and to engage in the transactions contemplated by this
Mortgage and the other Basic Documents.
34. RIGHT OF RELEASE. Mortgagee may allow Mortgagor any
indulgences or forbearances, or extensions of any kind, respecting payment
of the indebtedness secured hereby, or may release portions of the Premises
without affecting the personal liability of any person, corporation or
other entity for the payment of such indebtedness, or the lien of this
Mortgage upon the remainder of the Premises for the full amount of the
indebtedness then remaining unpaid. In the event of the sale or transfer
by operation of law or otherwise, of all or any part of, or interest in,
the Premises described in this Mortgage, Mortgagee is hereby authorized and
empowered to deal with such vendee or transferee with reference to the
Premises and/or the debt secured hereby, or with reference to any of the
terms and/or conditions hereof, as fully and to the same extent as it might
deal with the original parties hereto and without in any way releasing or
discharging any of the liabilities or undertakings hereunder.
35. INTERPRETATION. The term Mortgagor as used in every instance
shall include Mortgagor's heirs, executors, administrators, successors,
legal representatives and assigns, either voluntary by act of the parties
or involuntary by operation of law and shall denote the singular and/or
plural, and the masculine and/or feminine and natural and/or artificial
persons, whenever and wherever the context so requires or admits. If more
than one party is named as Mortgagor, the obligation hereunder of each such
party shall be deemed to be joint and several. The term Mortgagee as used
in every instance shall include Mortgagee's successors, legal
representatives and assigns, including all subsequent assignees, either
voluntary by act of the parties, or involuntary by operation of law.
36. AMENDMENTS. This Mortgage cannot be changed, modified or
amended in any way except by an agreement in writing, signed by the party
against whom enforcement of the change, modification or amendment is
sought.
37. PARITY INDEBTEDNESS. Subject to the provisions of this
Paragraph 37, Mortgagor may from time to time incur additional indebtedness
with respect to the Project and secure such indebtedness with a mortgage
lien on the Premises on a parity with, and equal and coordinate in lien
with, the lien of this Mortgage. Any such indebtedness is referred to
herein as "Parity Indebtedness" and any mortgage securing Parity
Indebtedness is referred to herein as a "Parity Mortgage."
Parity Indebtedness may be incurred only for the purposes of (i)
completing construction of the Project, (ii) making improvements or
betterments to the Project or (iii) to redeem all or a portion of the
Bonds, subject, however to the following conditions:
(i) Mortgagor shall be obligated equally and ratably to make
payments sufficient to pay all debt service on both the Bonds and the
Parity Indebtedness;
(ii) if Parity Indebtedness is incurred for the purpose of
refunding a portion of the Bonds, an independent certified public
accountant (or another independent consultant reasonably satisfactory to
Mortgagee) shall have provided a certificate stating that, based upon
reasonable assumptions, the sum of (A) the present value of the annual debt
service in each fiscal year with respect to the Bonds to be Outstanding (as
defined in the Loan Agreement) after incurrence of such Parity Indebtedness
and (B) the present value of the annual debt service on the Parity
Indebtedness in each such fiscal year will be less than what the aggregate
annual debt service on all of the Bonds Outstanding would be in each such
fiscal year during the remaining term of the portion of the Bonds to be
refunded if such Portion were not refunded;
(iii) if Parity Indebtedness is incurred for the purpose of
completing construction of the Project, the maximum original principal
amount of such Parity Indebtedness shall not exceed $4,000,000;
(iv) if Parity Indebtedness is incurred for the purpose of
making improvements or betterments to the Project, an independent certified
accountant (or another independent consultant reasonably satisfactory to
Mortgagee) shall have provided a certificate stating that the following
coverage tests shall be satisfied:
(A) for at least 12 consecutive months during the 24-
month period prior to the closing of the Parity Indebtedness
the net revenues of the Project were not less than 125 percent of the
aggregate annual debt service on both the Bonds and an previously issued
Parity Indebtedness then Outstanding; and
(B) based upon reasonable assumptions, the net revenues
of the Project for at least the 5-year period following the completion of
the improvements or betterments being financed by the Parity Indebtedness
shall be not less than 125 percent of the sum of (x) the aggregate annual
debt service on the Bonds to be Outstanding during such 5-year period and
(y) the aggregate annual debt service on the Parity Indebtedness to be
outstanding during such 5-year period.
Mortgagee will do, execute, acknowledge, deliver and record such
amendments to this Mortgage, intercreditor agreements or
similar instruments as the holder of any Parity Indebtedness may reasonably
require for the purpose of assuring and confirming that the lien of such
holder's Parity Mortgage is equal in lien and on parity with the lien of
this Mortgage; the parties hereby expressly agree that the entering into of
any such intercreditor agreement shall not require any consent of the
Bondholders (as defined in the Loan Agreement) under Section 1302 or any
other provision of the Loan Agreement. Any intercreditor agreement so
entered into between Mortgagee and the holder of any Parity Indebtedness
(for purposes of this Paragraph 31, each of the Mortgagee and any such
holder of Parity Indebtedness shall be referred to as a "Creditor") shall
include provisions customarily found in intercreditor agreements between
creditors sharing a first mortgage lien, addressing, but not limited to,
the following matters:
(i) the liens of this Mortgage and the Parity Indebtedness
shall be of equal priority, PARI PASSU;
(ii) an Event of Default under this Mortgage shall constitute
an "Event of Default" under the Parity Indebtedness and vice versa;
(iii) if either Creditor declares that an Event of Default has
occurred, it shall consult with the other Creditor prior to the exercise of
any remedy;
(iv) each Creditor shall be entitled to notice from the other
Creditor of any default by Mortgagor under each other Creditor's financing
documents and shall be entitled to a reasonable period within which to cure
any such default;
(v) all amounts received by either Creditor upon the exercise
of any remedies by reason of an Event of Default by Mortgagor shall be
applied in the following order of priority: FIRST, to the reasonable costs
of enforcement and collection incurred by such creditor; SECOND, to the PRO
RATA payment, on a PARI PASSU basis, of the following amounts under the
Creditors' respective financing documents:
A. accrued and unpaid interest and premium, if any;
B. repayment of outstanding principal; and
C. payment of any other amounts then owing under each
financing documents;
and THIRD to Mortgagor.
38. SUBORDINATE INDEBTEDNESS. Mortgagor may, in its sole
discretion and without the approval of Mortgagee, further encumber or
mortgage the Premises, or any part thereof, or any interest therein without
the prior written consent of Mortgagee. Any such indebtedness secured by a
mortgage on the Premises or any part thereof or interest therein is
referred to herein as "Subordinate Indebtedness" any mortgage or similar
security instrument securing Subordinate Indebtedness is referred to herein
as a "Subordinate Mortgage." A fully executed counterpart of each
Subordinate Mortgage shall be delivered to Mortgagee by Mortgagor within
ten (10) days after the execution and delivery thereof by Mortgagor. Each
Subordinate Mortgage shall contain an express covenant to the effect that
notwithstanding any other provision of such Subordinate Mortgage, it is in
all respects subject and subordinate to the lien and terms, provisions,
agreements, covenants and conditions of this Mortgage and that the holder
of such Subordinate Mortgage will upon demand confirm the subordination of
such Subordinate Mortgage to the lien and terms, covenants and conditions
of this Mortgage, as hereinafter extended, renewed, modified, replaced or
consolidated. In addition, the holder of each Subordinated Mortgage shall
agree with Mortgagee as follows:
(a) Mortgagee shall be entitled to notice from such holder of
any default by Mortgagor under the Subordinate Mortgage and shall be
entitled to a reasonable period within which to cure any such
default; and
(b) Such holder shall agree that it will not, without at
least thirty (30) days' prior written notice to Mortgagee, (i) make any
request or demand for, accelerate or bring any action with respect to, the
payment or performance of andy Subordinated Indebtedness, (ii) bring any
action to or otherwise enforce any judgment or lien against Mortgagor or
its assets, (iii) seize any property of Mortgagor, or (iv) institute, or
join in any petition for, any insolvency, bankruptcy, receivership or
similar proceeding against Mortgagor; except that any such notice of an
action pursuant to clause (iv) above shall be given 90 days prior thereto.
39. GOVERNING LAW. This Mortgage and the Loan Agreement secured
hereby are to be construed according to the laws of the Commonwealth of
Massachusetts.
40. HAZARDOUS SUBSTANCES. Mortgagor hereby represents and warrants
that neither Mortgagor nor any of its agents, contractors or employees has
released or discharged any "hazardous wastes" or "oil" from or onto the
Premises, and except for those hazardous wastes disclosed in the August
1990 report entitled "Phase I - Limited Site Investigation - Harborside
Development - Phase C - East Boston, Massachusetts (File No. 117/19.11)
prepared by ▇▇▇▇▇▇▇▇-▇▇▇▇▇ & Associates, Inc. (the "Environmental
Report"), Mortgagor is unaware of the existence on the Premises as of the
date hereof of any "hazardous wastes" or "oil." The Mortgagor further
represents and warrants and covenants and agrees that:
(a) Except to the extent disclosed in the Environmental
Report, to the best of its knowledge neither the Mortgagor nor any person
for whose conduct the Mortgagor is responsible ever:
(i) owned, occupied, or operated a site or vessel on
which any hazardous material or oil was or is stored (except if such
storage was or is in compliance with all laws, ordinances, and regulations
pertaining thereto) transported, or disposed of (the terms "hazardous
substances," "site," "vessel," "hazardous material," and "hazardous
wastes," respectively, being used in this Section with the meaning given
those terms in the Federal Comprehensive Environmental Response,
Compensation and liability Act of 1980, 42 U.S.C. Sec. 9601 as amended ET
SEQ., Massachusetts General Laws, Chapter 21C, and the regulations
promulgated thereunder, 310 C.M.R. Sec. 30.00 ET SEQ., as amended, and
Massachusetts General laws, Chapter 21E, as amended);
(ii) directly or indirectly transported, or arranged for
transport, of any hazardous material or oil (except if such transportation
was or is in compliance with all laws, ordinances and regulations
pertaining thereto);
(iii)caused or was legally responsible for any release,
or threat of release, of any hazardous material or oil;
(iv) received notification from any federal, state or
other governmental authority of: any potential, known, or threat of
release of any hazardous material or oil on or from the Premises or any
other site or vessel owned, occupied, or operated either by the Mortgagor
or any person for whose conduct the Mortgagor is responsible or whose
liability may result in a lien on the Premises; or the incurrence of any
expense or loss by such governmental authority, or by any other person, in
connection with the assessment, containment, or removal of any release, or
threat of release, of any hazardous material or oil from the Premises or
any such site or vessel.
(b) To the best of its knowledge no hazardous material or oil
was ever, or is now, stored on (except in compliance with all laws,
ordinances, and regulations pertaining thereto and except to the extent
disclosed in the Environmental Report, transported, or disposed of on the
Premises.
(c) The Mortgagor shall:
(i) not store (except in compliance with all laws,
ordinances, and regulations pertaining thereto), or dispose of any
hazardous material or oil on the Premises, or on any other site or vessel
owned, occupied, or operated either by the Mortgagor, or by any person for
whose conduct the Mortgagor is responsible;
(ii) neither directly nor indirectly transport or
arrange for the transport of any hazardous material or oil (except in
compliance with all laws, ordinances, and regulation pertaining thereto);
and
(iii)provide the Mortgagee with written notice: (x) upon
the Mortgagor's obtaining knowledge of any potential or known release, or
threat of release, of any hazardous material or oil at or from the Premises
other than or in addition to the matters disclosed in the Environmental
Report, or any other site or vessel owned, occupied, or operated by the
Mortgagor or by any person for whose conduct the Mortgagor is responsible
or whose liability may result in a lien on the Premises; (y) upon the
Mortgagor's receipt of any notice to such effect from any federal, state,
or other governmental authority; and (z) upon the Mortgagor's obtaining
knowledge of any incurrence of any expense or loss by such governmental
authority in connection with the assessment, containment, or removal of any
hazardous material or oil for which expense or loss the Mortgagor may be
liable or for which expense a lien may be imposed on the Premises.
(d) The Mortgagor shall indemnify, defend, and hold the
Mortgagee harmless of and from any claim brought or threatened against the
Mortgagee by the Mortgagor, any guarantor or endorser of the obligations of
Mortgagor to Mortgagee under the Basic Documents, or any governmental
agency or authority or any other person (as well as from attorneys'
reasonable fees and expenses in connection therewith) on account of the
presence of hazardous material or oil on the Premises, or the failure by
the Mortgagor to comply with the terms and provisions hereof (each of which
may be defended, compromised, settled, or pursued by the
Mortgagee with counsel of the Mortgagee's selection, but at the expense of
Mortgagor). The within indemnification shall survive satisfaction of the
Mortgagor's obligations under the Basic Documents or termination, release,
or discharge executed by the Mortgagee in favor of the Mortgagor.
(e) In the event that Mortgagor fails to comply with the
requirements of any applicable federal, state or other governmental law
with respect to the treatment, disposal or storage of hazardous waste on
the Premises, Mortgagee may at his election, but without obligation to do
so, take any and all actions that it deems necessary to cure said failure
of compliance and any and all amounts paid as a result thereof, together
with interest thereon at the Involuntary Rate from the date of payment,
shall be immediately due and payable by Mortgagor to Mortgagee, and until
paid shall be added to and become part of the principal debt secured hereby
and said amount may be collected as part of said principal debt in any suit
hereon or upon the Basic Documents; or Mortgagee, by the payment of any
assessment, claim or change, may, if it sees fit, be thereby subrogated to
the Commonwealth of Massachusetts, but such payment shall not be deemed to
relieve Mortgagor from any default hereunder or impair any right or remedy
with respect thereto.
41. NO PERSONAL LIABILITY. No partner of Mortgagor, other than
LHA-II, Inc. as sole general partner, and no officer, employee or agent of
Mortgagor, and no stockholder, director, officer, employee or agent of any
partner of Mortgagor, including for this purpose LHA-II, Inc. as sole
general partner of Mortgagor, shall be personally liable for Mortgagor's
obligations under this Mortgage, the Loan Agreement or the Other Basic
Documents.
42. JOINDER BY LANDLORD. Pursuant to the Ground Lease, and as
between the landlord and the tenant thereunder, the holder of the tenant's
interest under the Ground Lease owns, during the term of the Ground Lease,
the Improvements; Mortgagor, as tenant, shall own any Improvements until
the termination of Mortgagor's occupancy of the Project or the expiration
of the Lease Term, whichever occurs later; provided, however, that, without
limiting any of Mortgagor's rights to use and obligations to maintain the
entire Project and all Improvements, the Landlord, for purposes of M.G.L.
Chapter 143, Section 3A, is deemed to have retained title to an undivided
1/1000 interest in the Improvements (the "Landlord's Retained Interest").
For the purpose of confirming its agreement in the Ground Lease that
the Landlord's Retained Interests are fully subject and subordinate to the
lien of this Mortgage, the Landlord hereby covenants and agrees for the
benefit of Mortgagee as follows:
(a) The Landlord hereby grants with Mortgage Covenants, to
Mortgagee, all of the Landlord's right, title and interest in and to the
Landlord's Retained Interest. Upon the breach of any conditions contained
in this Mortgage, including, without limitation, the existence of any Event
of Default, the holder of this Mortgage may exercise any and all of the
remedies set forth in this Mortgage, including, without limitation, the
Statutory Power of Sale, with respect to the Landlord's Retained Interest.
(b) For so long as this Mortgage remains undischarged of
record:
(i) The Landlord agrees that the Landlord shall not sell,
transfer, lease, assign, pledge, mortgage, encumber, grant a security
interest in, or otherwise dispose of the Landlord's Retained Interest or
any part thereof; and
(ii) The Landlord shall forbear from exercising any remedies
that it may have on account of any default by Mortgagor under the Ground
Lease in order to permit the Trustee to have a reasonable time to exercise
any of its remedies arising under this Mortgage on account of such default
by Mortgagor under the Ground Lease, including, if appropriate, the
foreclosure of the lien of this Mortgage on the Landlord's Retained
Interest.
By accepting and recording this Mortgage, the Mortgagee has acknowledged
and agreed that the Landlord shall have no personal liability whatsoever
for any of the indebtedness of Mortgagor under the Loan or otherwise
secured by this Mortgage.
This Mortgage is upon the STATUTORY CONDITION and upon the further
condition that all covenants and agreements of Mortgagor contained herein
and in the Loan Agreement shall be seasonably kept, observed, fully
performed and satisfied, for any breach of any of which conditions the
holder hereof shall have the STATUTORY POWER OF SALE.
IN WITNESS WHEREOF, Mortgagor has executed this Mortgage as a
sealed instrument by its duly authorized representative as of the day and
year first above written.
▇▇▇▇▇ HARBORSIDE ASSOCIATES II
LIMITED PARTNERSHIP
By LHA-II, Inc.
Its General Partner
By /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Its President
COMMONWEALTH OF MASSACHUSETTS
Suffolk, ss: December 20, 1990
Then personally appeared the above-named ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, known
to me to be the President of LHA-II, Inc., and acknowledged that he
executed the foregoing instrument on behalf of said corporation as general
partner of ▇▇▇▇▇ Harborside Associates II Limited Partnership, as his free
act and deed, and that he was duly authorized to act on behalf of said
corporation as general partner, before me
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------
Notary Public
My commission expires:
Stamp: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Notary Public
My Commission Expires March 16, 1995
JOINDER BY LANDLORD
The undersigned, as Landlord under the Ground Lease, joins in the
foregoing Mortgage for the sole purpose of subordinating the Landlord's
Retained Interest in the Improvements to the lien of the Mortgage as
provide in Paragraph 42.
MASSACHUSETTS PORT AUTHORITY
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------
Its Chairman
COMMONWEALTH OF MASSACHUSETTS
Suffolk, ss. December , 1990
Then personally appeared the above-named ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, known to
be to be the Chairman of the Massachusetts Port Authority, and acknowledged
that he executed the foregoing instrument on behalf of the Massachusetts
Port Authority as his free act and deed, and that he was duly authorized to
act on behalf of the Massachusetts Port Authority, before me
[ executed signature ]
______________________________________
Notary Public
My commission expires:
6/25/91
FIRST AMENDMENT
to
LEASEHOLD MORTGAGE AND SECURITY AGREEMENT
between
▇▇▇▇▇ HARBORSIDE ASSOCIATES II LIMITED PARTNERSHIP,
as Mortgagor
and
SHAWMUT BANK, N.A., AS TRUSTEE,
as Mortgagee
Upon recording, please return to:
Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇, Esq.
6/25/91
FIRST AMENDMENT TO
------------------
LEASEHOLD MORTGAGE AND SECURITY AGREEMENT
-----------------------------------------
THIS FIRST AMENDMENT TO LEASEHOLD MORTGAGE AND SECURITY AGREEMENT
(this "First Amendment") is dated as of June 27, 1991, by and between ▇▇▇▇▇
HARBORSIDE ASSOCIATES II LIMITED PARTNERSHIP, a Massachusetts limited
partnership having an address c/▇ ▇▇▇▇▇▇▇▇ Development Associates, ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (the "Mortgagor"), SHAWMUT BANK,
N.A., a national banking association, with its principal office in Boston,
Massachusetts, not individually but in its capacity as Trustee (the
"Trustee" or the "Mortgagee") under that certain Loan and Trust Agreement
(the "Loan Agreement") dated as of December 15, 1990, as amended and
restated as of June 27, 1991, among the Trustee, the Massachusetts Port
Authority (the "Authority"), and Mortgagor, in connection with the issuance
of the $40,000,000 Massachusetts Port Authority Special Project Revenue
Bonds, Series 1990 (Harborside Hyatt Conference Center and Hotel Project)
(the "Bonds").
Reference is made to the following facts:
A. Pursuant to that certain Loan and Trust Agreement dated as of
December 15, 1990, among the Trustee, the Authority and Mortgagor, in
connection with the issuance of the Bonds the Authority, in its capacity as
issuer of the Bonds, loaned to Mortgagor the proceeds of the sale of the
Bonds (the "Loan") to finance the acquisition, construction, equipping,
furnishing and initial operation of the Project, subject to the condition
that such proceeds were to be held in escrow until June 27, 1991, upon
which date the Bonds were either subject to mandatory tender for redemption
or to be remarketed and purchased in lieu of such redemption. The
obligation of Mortgagor to repay the Loan is secured, among other
collateral, by a certain Leasehold Mortgage and Security Agreement between
Mortgagor, as mortgagor, and Trustee, as mortgagee, dated as of December
15, 1990, recorded with the Suffolk County Registry of Deeds at Book 16656,
Page 1, and filed with the Suffolk County Registry District of the Land
Court as Document No. 472084 and noted on Certificate of Title No. 297 (the
"Original Mortgage").
B. Since the date of execution and delivery of the Original
Mortgage, certain documents referenced therein have been modified in
connection with the remarketing of the Bonds. Accordingly, the parties
hereto are entering into this First Amendment for the purpose of updating
the definitions of certain defined terms used therein.
C. Capitalized terms used in this First Amendment and not
otherwise defined shall have the meanings ascribed to them in the Original
Mortgage.
NOW THEREFORE, in consideration of the foregoing recitals, and as a
material inducement for the trustee to enter the amended and restated Loan
Agreement, and for the Bondholders (as defined
6/25/91
in the Loan Agreement) to purchase the remarketed Bonds, and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree to amend the Original
Mortgage as follows:
1. NEW DEFINITIONS. As used in the Original Mortgage, the
following terms shall have the following new meanings, which new meanings
shall supersede those originally set forth in the Original Mortgage:
"Architect's Consent to Assignment" shall mean the Agreement With
Respect to and Assignment of Architect's Contract, dated as of June 27,
1991, between Mortgagor and the Architect for the benefit of Mortgagee, as
additional security for the Loan.
"Assignment of Contracts" shall mean the Collateral Assignment of
Contracts, Licenses, Permits, Agreements, Warranties and Approvals, dated
as of December 15, 1990, made by Mortgagor to Mortgagee, as additional
security for the Loan.
"Assignment of Management Agreement" shall mean the Collateral
Assignment of Management Agreement, dated as of December 15, 1990, made by
Mortgagor to Mortgagee, as additional security for the Loan.
"Assignment of Rents" shall mean the Collateral Assignment of Rents
and Leases, dated as of December 15, 1990, made by Mortgagor to Mortgagee,
as additional security for the Loan.
"Construction Inspection Agreement" shall mean the agreement dated as
of June 27, 1991, between Mortgagor and the Construction Inspector with
respect to inspection of the construction of the Project on behalf of
Mortgagee and the performance of certain other work for mortgagee in
connection with the construction of the Project.
"Disbursement Agreement" shall mean the Disbursement Agreement dated
as of December 15, 1990, as amended and restated as of June 27, 1991,
between Mortgagor and the Trustee, as the same may from time to time be
amended, supplemented or otherwise modified.
"Ground Lease" shall have the meaning specified in Recital Paragraph
F of the Original Mortgage, as amended by a certain First Amendment to
Ground Lease for Phase C of the Bird Island Flats Development dated as of
June 27, 1991, between Mortgagor and the Authority.
"Loan Agreement" shall mean the Loan and Trust Agreement dated as of
December 15, 1990, as amended and restated as of June 27, 1991, among
Mortgagor, the Mortgagee and the Authority, as such Loan and Trust
Agreement may from time to time be amended, supplemented or otherwise
modified.
"Management Agreement" means the agreement between Mortgagor and
Manager dated March 15, 1990, on the cover sheet and dated as
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of February 1, 1990, in the text as supplemented by a letter agreement with
respect to the FFE Budget process dated March 15, 1990, with respect to the
management and operation of the Project, as further amended by a First
Amendment to Management Agreement dated as of June 27, 1991, as such
Management Agreement may from time to time be amended, supplemented,
otherwise modified or replaced.
"Mortgage" shall mean the Original Mortgage, as amended by this First
Amendment.
2. Paragraph 37 ("Parity Indebtedness") of the Original Mortgage
is amended by deleting subparagraph (iv) thereof (appearing on page 38) and
substituting in place thereof the following new subparagraph (iv):
(iv) if Parity Indebtedness is incurred for the purpose of
making improvements or betterments to the Project, an independent certified
accountant (or another independent consultant reasonably satisfactory to
Mortgagee) shall have provided a certificate stating that the following
coverage tests shall be satisfied:
(A) for at least 12 consecutive months during the 24-
month period prior to the closing of the Parity Indebtedness
the net revenues of the Project were not less than 125 percent of the
aggregate maximum annual debt service on both the Bonds and any previously
issued Parity Indebtedness then Outstanding; and
(B) based upon reasonable assumptions, the net revenues
of the Project for at least the 5-year period following the completion of
the improvements or betterments being financed by the Parity Indebtedness
shall be not less than 125 percent of the sum of (x) the aggregate maximum
annual debt service on the Bonds to be Outstanding during such 5-year
period and (y) the aggregate maximum annual debt service on the Parity
Indebtedness to be outstanding during such 5-year period.
3. Pursuant to the First Amendment to Ground Lease for Phase C of
the Bird Island Flats Development dated as of June 27, 1991, the initial
location of the so-called Off-Premises Parking Site(s) has changed from the
location on Zone 2 shown on Schedule P to the Original Mortgage. Such new
initial location of the Off-Premises Parking Site(s) is now situated
partially on Zone 2 and partially on Zone 3R, as approximately shown on the
new Schedule P (6/27/91 Rev.) attached to this First Amendment.
4. Except as amended hereby, the Original Mortgage remains
unchanged and in full force and effect.
IN WITNESS WHEREOF, each of Mortgagor and Mortgagee have executed
this Mortgage as a sealed instrument by their duly
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authorized representative as of the day and year first above written.
Mortgagor: ▇▇▇▇▇ HARBORSIDE ASSOCIATES II
LIMITED PARTNERSHIP
By: LHA-II, Inc.
Its General Partner
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Its President
Mortgagee: SHAWMUT BANK, N.A., AS TRUSTEE
By: /S/ ▇▇▇ ▇▇▇ ▇▇▇▇▇▇
----------------------------
Its Assistant Vice President
Hereunto duly authorized
COMMONWEALTH OF MASSACHUSETTS
Suffolk, ss. June 27, 1991
Then personally appeared the above-named ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, known to me
to be the President of LHA-II, Inc., and acknowledged that he executed the
foregoing instrument on behalf of said corporation as general partner of
▇▇▇▇▇ Harborside Associates II Limited Partnership, as his free act and
deed, and that he was duly authorized to act on behalf of said corporation
as general partner, before me
/S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Notary Public
My commission expires: March 16, ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ss. June 26, 1991
Then personally appeared the above-named ▇▇▇ ▇▇▇ ▇▇▇▇▇▇, known to me
to be the Assistant Vice President of Shawmut Bank, N.A., and acknowledged
that she executed the foregoing instrument on behalf of said corporation as
trustee, as her free act and deed, and that she was duly authorized to act
on behalf of said corporation, before me
[ executed signature ]
---------------------------------------
Notary Public
My commission expires: December 2, 1994
6/25/91
JOINDER BY LANDLORD
The undersigned, as Landlord under the Ground Lease, joins in the
foregoing First Amendment for the sole purpose of consenting thereto.
MASSACHUSETTS PORT AUTHORITY
By: /S/ ▇▇▇▇▇▇ ▇. ▇'▇▇▇▇▇
------------------------------
Its: Secretary-Treasurer
COMMONWEALTH OF MASSACHUSETTS
Suffolk, ss. June 26, 1991
Then personally appeared the above-named ▇▇▇▇▇▇ ▇. ▇'▇▇▇▇▇, known to
me to be the Secretary-Treasurer of the Massachusetts Port Authority, and
acknowledged that he executed the foregoing instrument on behalf of the
Massachusetts Port Authority as his free act and deed, and that he was duly
authorized to act on behalf of said corporation, before me.
[ executed signature ]
---------------------------------------
Notary Public
My commission expires: March 13, 1992