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EXHIBIT 4.11
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STERLING FIBERS, INC.,
Mortgagor,
to
▇▇▇▇▇▇ TRUST COMPANY OF NEW YORK,
Mortgagee
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SECOND MORTGAGE, ASSIGNMENT OF LEASES AND RENTS,
SECURITY AGREEMENT AND FIXTURE FILING
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Dated as of July 23, 1999
This instrument affects certain real and personal property
located in Santa ▇▇▇▇ County,
State of Florida.
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Record and return to:
▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Notwithstanding anything to the contrary contained herein, the maximum
principal indebtedness secured under any contingency by this instrument
shall in no event exceed $295,000,000.
Pursuant to the procedure set forth in Florida Department of Revenue
Regulation 12B-4.053(32) (c) the documentary stamp tax due on the
indebtedness secured hereby is $59,381.00, which is based upon a value
of the Florida property secured hereby in the amount of
$16,966,000.000.
Based on the valuations of the collateral as a ratio as set forth in
Florida Department of Revenue Regulation 12C-2.004(2) the intangible
tax due on the indebtedness secured and allocated to Florida real
estate is $6,996.36. This is based upon a total value for all Florida
Real Estate of $14, 530,000.00 and the value of all collateral in the
amount of $1,225,309,000.00.
CALCULATIONS:
$14,530,000.00 X $295,000,000.00 = $ 3,498,178.83
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$1,225,309,000.00
$ 3,498, 178.83 X .002 = $6,996.36
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The calculations used for computing documentary stamp taxes and
intangible taxes are based upon present valuations as agreed by the
parties and in no way limit the Mortgagee's right or ability to fully
recover on the indebtedness secured hereby.
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TABLE OF CONTENTS
Page
ARTICLE I
COVENANTS AND AGREEMENTS OF THE MORTGAGOR
SECTION 1.1. Payment of Obligations......................................................................4
SECTION 1.2. Title to Collateral, etc....................................................................5
SECTION 1.3. Title Insurance.............................................................................5
SECTION 1.4. Recordation.................................................................................6
SECTION 1.5. Payment of Impositions, etc.................................................................6
SECTION 1.6. Insurance and Legal Requirements............................................................6
SECTION 1.7. Security Interests, etc.....................................................................7
SECTION 1.8. Permitted Contests..........................................................................7
SECTION 1.9. Leases......................................................................................8
SECTION 1.10. Compliance with Instruments.................................................................8
SECTION 1.11. Maintenance and Repair, etc.................................................................8
SECTION 1.12. Alterations, Additions, etc.................................................................8
SECTION 1.13. Intentionally Omitted.......................................................................9
SECTION 1.14. Assignment of Rents, Proceeds, etc..........................................................9
SECTION 1.15. No Claims Against the Mortgagee.............................................................9
SECTION 1.16. Indemnification............................................................................10
SECTION 1.17. No Credit for Payment of Taxes.............................................................11
SECTION 1.18. Intentionally Omitted......................................................................11
SECTION 1.19. No Transfer of the Property................................................................11
SECTION 1.20. Security Agreement.........................................................................11
SECTION 1.21. Representations and Warranties.............................................................12
SECTION 1.22. Mortgagor's Covenants......................................................................12
SECTION 1.23. Attornment.................................................................................12
ARTICLE II
INSURANCE; DAMAGE, DESTRUCTION OR taking, ETC.
SECTION 2.1. Insurance..................................................................................13
SECTION 2.2. Damage, Destruction or Taking; Mortgagor to Give Notice; Assignment of Awards..............14
SECTION 2.3. Application of Proceeds and Awards.........................................................15
SECTION 2.4. Total Taking and Total Destruction.........................................................17
ARTICLE III
EVENTS OF DEFAULT; REMEDIES, ETC.
SECTION 3.1. Events of Default; Acceleration............................................................17
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SECTION 3.2. Legal Proceedings; Judicial Foreclosure....................................................18
SECTION 3.3. Power of Sale..............................................................................18
SECTION 3.4. Uniform Commercial Code Remedies...........................................................18
SECTION 3.5. Mortgagee Authorized to Execute Deeds, etc.................................................19
SECTION 3.6. Purchase of Collateral by Mortgagee........................................................19
SECTION 3.7. Receipt a Sufficient Discharge to Purchaser................................................19
SECTION 3.8. Waiver of Appraisement, Valuation, etc.....................................................19
SECTION 3.9. Sale a Bar Against Mortgagor...............................................................19
SECTION 3.10. Obligations to Become Due on Sale..........................................................19
SECTION 3.11. Application of Proceeds of Sale and Other Moneys...........................................20
SECTION 3.12. Appointment of Receiver....................................................................20
SECTION 3.13. Possession, Management and Income..........................................................20
SECTION 3.14. Right of Mortgagee to Perform Mortgagor's Covenants, etc...................................21
SECTION 3.15. Subrogation................................................................................21
SECTION 3.16. Remedies, etc., Cumulative.................................................................21
SECTION 3.17. Provisions Subject to Applicable Law.......................................................22
SECTION 3.18. No Waiver, etc.............................................................................22
SECTION 3.19. Compromise of Actions, etc.................................................................22
ARTICLE IV
DEFINITIONS
SECTION 4.1. Terms Defined in this Mortgage.............................................................22
SECTION 4.2. Use of Defined Terms.......................................................................24
SECTION 4.3. Indenture Definitions......................................................................24
ARTICLE V
MISCELLANEOUS
SECTION 5.1. Further Assurances; Financing Statements...................................................24
SECTION 5.2. Additional Security........................................................................25
SECTION 5.3. Defeasance; Partial Release, etc...........................................................25
SECTION 5.4. Notices, etc...............................................................................25
SECTION 5.5. Waivers, Amendments, etc...................................................................25
SECTION 5.6. Cross-References...........................................................................25
SECTION 5.7. Headings...................................................................................25
SECTION 5.8. Currency...................................................................................26
SECTION 5.9. Governing Law..............................................................................26
SECTION 5.10. Successors and Assigns, etc................................................................26
SECTION 5.11. Waiver of Jury Trial; Submission to Jurisdiction...........................................26
SECTION 5.12. Severability; Conflicts....................................................................27
SECTION 5.13. Security Agreement.........................................................................27
SECTION 5.14. Usury Savings Clause.......................................................................27
SECTION 5.15. Future Advances............................................................................27
SECTION 5.16. Subordination to First Mortgage............................................................28
Exhibit A Legal Description of the Land
Exhibit B Permitted Encumbrances
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SECOND MORTGAGE, ASSIGNMENT OF LEASES AND RENTS,
SECURITY AGREEMENT AND FIXTURE FILING
SECOND MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND
FIXTURE FILING, dated as of July 23, 1999 (this "Mortgage"), made by STERLING
FIBERS, INC., a Delaware corporation (the "Mortgagor"), having an address at
▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, to ▇▇▇▇▇▇ TRUST COMPANY OF
NEW YORK, a New York corporation, as collateral agent and indenture trustee for
the benefit of itself and certain other holders (collectively, the "Holders") of
the 12 3/8% Senior Secured Notes due 2006, having an address at ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, as mortgagee
(together with its successors and assigns from time to time, the "Mortgagee").
All capitalized terms used but not otherwise defined herein shall have the
meaning ascribed thereto in the Indenture.
WITNESSETH THAT:
WHEREAS, the Mortgagor is on the date of delivery hereof the owner of
fee title (or easement or leasehold title if otherwise indicated on Exhibit A
hereto) to the parcels of land described in Exhibit A hereto (the "Land") and of
the Improvements (hereinafter defined);
WHEREAS, the Mortgagee, as collateral agent and indenture trustee, and
Sterling Chemicals, Inc., a Delaware corporation, as issuer ("Issuer") have
entered into that certain Indenture, dated as of the date hereof (as amended,
restated, supplemented or otherwise modified from time to time, the
"Indenture"), pursuant to which the Issuer issued $295 million in the aggregate
principal amount of 12 3/8% Senior Secured Notes due 2006 (the "Senior Secured
Notes"); and
WHEREAS, Mortgagor has granted a first priority mortgage (the "First
Mortgage") encumbering the Collateral pursuant to that certain Revolving Credit
Agreement (the "Credit Agreement"), by and among Sterling Chemicals, Inc.,
Sterling Canada, Inc., Sterling Pulp Chemicals US, Inc., Sterling Pulp
Chemicals, Inc., Mortgagor, Sterling Chemicals Energy, Inc. and Sterling
Chemicals International, Inc., as Borrowers (collectively, "Borrowers"), various
financial institutions, as lenders ("Lenders"), DLJ Capital Funding, Inc., as
syndication agent ("Syndication Agent"), The CIT Group/Business Credit, Inc., as
the administrative agent and collateral agent (the "Administrative Agent"), and
Credit Suisse First Boston, as the documentation agent; and
WHEREAS, pursuant to the terms of the Credit Agreement, the Lenders (as
defined in the Credit Agreement) have agreed to make Fixed Assets Loans (as
defined in the Credit Agreement) (the "Senior Loan") to the Borrowers in the
maximum original principal amount of Seventy Million Dollars ($70,000,000), the
payment of which is secured by, inter alia, the First Mortgage encumbering the
Collateral; and
WHEREAS, during the pendency of the Senior Loan and any refinancing
thereof to the extent permitted hereunder, this Mortgage shall be subordinate
and inferior to the First Mortgage; and
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WHEREAS, the Mortgagor has duly authorized the execution, delivery and
performance of this Mortgage.
GRANT:
NOW, THEREFORE, for and in consideration of the premises, and of the
mutual covenants herein contained, and in order to secure the full, timely and
proper payment and performance of and compliance with each and every one of the
Obligations (as hereinafter defined), the Mortgagor hereby irrevocably grants,
bargains, sells, mortgages, warrants, aliens, demises, releases, hypothecates,
pledges, assigns, transfers and conveys to the Mortgagee and its successors and
assigns, forever, all of the following (the "Collateral"):
(a) Real Estate. All of Mortgagor's right, title and interest
in and to all of the Land and all additional lands and estates therein
now owned by the Mortgagor for use or development with the Land or any
portion thereof, together with all and singular the tenements, rights,
easements, hereditaments, rights of way, privileges, liberties,
appendages and appurtenances now or hereafter belonging or in any way
pertaining to the Land and such additional lands and estates therein
(including, without limitation, all rights relating to storm and
sanitary sewer, water, gas, electric, railway and telephone services);
all development rights, air rights, riparian rights, water, water
rights, water stock, all rights in, to and with respect to any and all
oil, gas, coal, minerals and other substances of any kind or character
underlying or relating to the Land and such additional lands and
estates therein and any interest therein; all estate, claim, demand,
right, title or interest of the Mortgagor in and to any street, road,
highway or alley, vacated or other, adjoining the Land or any part
thereof and such additional lands and estates therein; all strips and
gores belonging, adjacent or pertaining to the Land or such additional
lands and estates (herein collectively referred to as the "Real
Estate");
(b) Improvements. All of Mortgagor's right, title and interest
in and to all buildings, structures and other improvements now existing
and any additions and alterations thereto or replacements thereof, now
or hereafter built, constructed or located upon the Real Estate; and,
to the extent that any of the following items of property constitutes
fixtures under applicable laws, all furnishings, fixtures, fittings,
appliances, apparatus, equipment, machinery, building and construction
materials and other articles of every kind and nature whatsoever and
all replacements thereof, now affixed or attached to, placed upon or
used in any way in connection with the complete and comfortable use,
enjoyment, occupation, operation, development and/or maintenance of the
Real Estate or such buildings, structures and other improvements,
including, but not limited to, partitions, furnaces, boilers, oil
burners, radiators and piping, plumbing and bathroom fixtures,
refrigeration, heating, ventilating, air conditioning and sprinkler
systems, other fire prevention and extinguishing apparatus and
materials, vacuum cleaning systems, gas and electric fixtures,
incinerators, compactors, elevators, engines, motors, generators and
all other articles of property which are considered fixtures under
applicable law (such buildings, structures and other improvements and
such other property are herein collectively referred to as the
"Improvements"; the Real Estate and the Improvements are herein
collectively referred to as the "Property");
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(c) Goods. All of Mortgagor's right, title and interest in and
to all building materials, construction materials, appliances
(including, without limitation, stoves, ranges, ovens, disposals,
refrigerators, water fountains and coolers, fans, heaters, dishwashers,
clothes washers and dryers, water heaters, hood and fan combinations,
kitchen equipment, laundry equipment, kitchen cabinets and other
similar equipment), stocks, supplies, blinds, window shades, drapes,
carpets, floor coverings, manufacturing equipment and machinery, office
equipment, growing plants and shrubberies, control devices, equipment
(including window cleaning, building cleaning, swimming pool,
recreational, monitoring, garbage, pest control and other equipment),
motor vehicles, tools, furnishings, furniture, lighting, non-structural
additions to the Real Estate and Improvements and all other tangible
property of any kind or character, together with all replacements
thereof, now located on or in or used or useful in connection with the
complete and comfortable use, enjoyment, occupation, operation,
development and/or maintenance of the Property, regardless of whether
or not located on or in the Property or located elsewhere for purposes
of storage, fabrication or otherwise (herein collectively referred to
as the "Goods");
(d) Leases. All rights of the Mortgagor in, to and under all
leases, licenses, occupancy agreements, concessions and other
arrangements, oral or written, and now existing or replacements thereof
hereafter existing, whereby any Person agrees to pay money or any
other consideration for the use, possession or occupancy of, or any
estate in, the Property or any portion thereof or interest therein
(herein collectively referred to as the "Leases"), and the right,
subject to applicable law, upon the occurrence of any Event of Default
hereunder, to receive and collect the Rents (as hereinafter defined)
paid or payable thereunder;
(e) Intentionally Omitted.
(f) Plans. All rights of the Mortgagor in and to all plans and
specifications, designs, drawings and other information, materials and
matters heretofore prepared relating to the Improvements or any
construction on the Real Estate (herein collectively referred to as the
"Plans");
(g) Permits. All rights of the Mortgagor, to the extent
assignable, in, to and under all permits, franchises, licenses,
approvals and other authorizations respecting the use, occupation and
operation of the Property and every part thereof and respecting any
business or other activity conducted on or from the Property, and any
product or proceed thereof or therefrom, including, without limitation,
all building permits, certificates of occupancy and other licenses,
permits and approvals issued by governmental authorities having
jurisdiction (collectively, the "Permits");
(h) Contracts. All right, title and interest of the Mortgagor,
to the extent assignable, in and to all certificates, warranties,
appraisals, engineering, environmental, soils, insurance and other
reports and studies, books, records, correspondence, files and
advertising materials, and other documents, now or hereafter obtained
or entered into, as the case may be, pertaining to the construction,
use, occupancy, possession, operation,
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management, leasing, maintenance and/or ownership of the Property and
all right, title and interest of the Mortgagor therein (collectively,
the "Contracts");
(i) Leases of Furniture, Furnishings and Equipment. All right,
title and interest of the Mortgagor as lessee in, to and under any
leases of furniture, furnishings, equipment and any other Goods now or
hereafter installed in or at any time used in connection with the
Property;
(j) Rents. All rents, issues, profits, royalties, avails,
income and other benefits derived or owned, directly or indirectly, by
the Mortgagor from the Property, including, without limitation, all
rents and other consideration payable by tenants, claims against
guarantors, and any cash or other securities deposited to secure
performance by tenants, under the Leases (herein collectively referred
to as the "Rents"); and
(k) Proceeds. All proceeds of the conversion, voluntary or
involuntary of any of the foregoing into cash or liquidated claims,
including, without limitation, proceeds of insurance and condemnation
awards (herein collectively referred to as the "Proceeds"); provided
however, the Collateral shall not include any general intangibles or
other rights arising under any contracts, instruments, licenses, or
other documents as to which the grant of a lien and/or security
interest would constitute a violation of a valid and enforceable
restriction in favor of a third party on such grant, unless and until
any required consents shall have been obtained; and further provided,
however, in no event shall the Collateral hereunder include any item or
classes of "Collateral" as defined in the Current Assets Security
Agreement (as defined in the Credit Agreement) and provided further,
that the Collateral shall include after acquired property to the
extent, and only to the extent, that such after acquired property is in
replacement or substitution of Collateral existing as of the date
hereof.
AND, without limiting any of the other provisions of this Mortgage, the
Mortgagor expressly grants to the Mortgagee, as secured party, a security
interest in all of those portions of the Collateral which are or may be subject
to the State Uniform Commercial Code provisions applicable to secured
transactions, subject, however, to the Permitted Encumbrances;
TO HAVE AND TO HOLD the Collateral unto the Mortgagee, its successors
and assigns, forever, subject, however, to the Permitted Encumbrances.
FURTHER to secure the full, timely and proper payment and performance
of the Obligations, the Mortgagor hereby covenants and agrees with and warrants
to the Mortgagee as follows:
ARTICLE I
COVENANTS AND AGREEMENTS OF THE MORTGAGOR
SECTION 1.1 Payment of Obligations. (i) The Mortgagor agrees that:
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(a) it will duly and punctually pay and perform or cause to be
paid and performed each of its liabilities, duties and obligations
pursuant to its Subsidiary Guarantees under the Indenture at the time
and in accordance with the terms thereof, and
(b) when and as due and payable from time to time in
accordance with the terms hereof, pay and perform, or cause to be paid
and performed, all other Obligations.
SECTION 1.2 Title to Collateral, etc. The Mortgagor represents and
warrants to and covenants with the Mortgagee that:
(a) except as otherwise permitted by the terms of the
Indenture, as of the date hereof and at all times hereafter while this
Mortgage is outstanding, the Mortgagor (1) is and shall be the absolute
owner of the legal and beneficial title to the applicable interest in
the Property and to all other property included in the Collateral, and
(2) has and shall have good and marketable title in fee simple
absolute, or good and sufficient easement or leasehold title, as
currently represented in the granting clause as of the date hereof, to
the Property, subject in each case only to this Mortgage, the Permitted
Liens, the First Mortgage and the encumbrances set forth in Exhibit B
(collectively, the "Permitted Encumbrances");
(b) the Mortgagor has good and lawful right, power and
authority to execute this Mortgage and to convey, transfer, assign,
mortgage and grant a security interest in the Collateral, all as
provided herein;
(c) this Mortgage has been duly executed, acknowledged and
delivered on behalf of the Mortgagor, all consents and other actions
required to be taken by the officers, directors, shareholders and
partners, as the case may be, of the Mortgagor have been duly and fully
given and performed and this Mortgage constitutes the legal, valid and
binding obligation of the Mortgagor, enforceable against the Mortgagor
in accordance with its terms; and
(d) the Mortgagor, at its expense, will warrant and defend to
the Mortgagee and any purchaser under the power of sale herein or at
any foreclosure sale such title to the Collateral and the mortgage lien
and perfected security interest of this Mortgage thereon and therein
against all claims and demands and will maintain, preserve and protect
such lien and security interest and will keep this Mortgage a valid,
direct mortgage lien of record on the Property and a perfected security
interest in the Collateral other than the Property, subject only to the
Permitted Encumbrances.
SECTION 1.3. Title Insurance.
SECTION 1.3.1. Title Insurance Policy. Concurrently with the execution
and delivery of this Mortgage, the Mortgagor, at its expense, has obtained and
delivered to the Mortgagee a loan policy or policies of title insurance in an
amount, and in form and substance, reasonably satisfactory to the Mortgagee
naming the Mortgagee as the insured, insuring the title to and the mortgage lien
of this Mortgage on the Property, with endorsements reasonably requested by the
Mortgagee. The Mortgagor has duly paid in full all premiums and other charges
due in connection with the issuance of such policy or policies of title
insurance.
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SECTION 1.3.2. Title Insurance Proceeds. All proceeds received by and
payable to the Mortgagee for any loss under the loan policy or policies of title
insurance delivered to the Mortgagee pursuant to Section 1.3.1, or under any
policy or policies of title insurance delivered to the Mortgagee in substitution
therefor or replacement thereof, shall be the property of the Mortgagee and
shall be applied by the Mortgagee in accordance with the provisions of Section
2.3.
SECTION 1.4. Recordation. The Mortgagor, at its expense, will at all
times cause this Mortgage and any instruments amendatory hereof or supplemental
hereto and any instruments of assignment hereof or thereof (and any appropriate
financing statements or other instruments and continuations thereof), and each
other instrument delivered in connection with the Indenture, the Senior Secured
Notes or any other Security Agreement made pursuant to the terms of the
Indenture and intended thereunder to be recorded, registered and filed, to be
kept recorded, registered and filed, in such manner and in such places, and will
pay all such recording, registration, filing fees, taxes and other charges, and
will comply with all such statutes and regulations as may be required by law in
order to establish, preserve, perfect and protect the lien and security interest
of this Mortgage as a valid, direct second mortgage lien on the Property and
second priority perfected security interest in the Collateral other than the
Property, subject only to the Permitted Encumbrances. The Mortgagor will pay or
cause to be paid, and will indemnify the Mortgagee in respect of, all taxes
(including interest and penalties) at any time payable in connection with the
filing and recording of this Mortgage and any and all supplements and amendments
hereto.
SECTION 1.5. Payment of Impositions, etc. Subject to Section 1.8
(relating to permitted contests), the Mortgagor will pay or cause to be paid
before the same would become delinquent and before any fine, penalty, interest
or cost may be added for non-payment, all taxes, assessments, water and sewer
rates, charges, license fees, inspection fees and other governmental levies or
payments, of every kind and nature whatsoever, general and special, ordinary and
extraordinary, unforeseen as well as foreseen, which at any time may be
assessed, levied, confirmed, imposed or which may become a lien upon the
Collateral, or any portion thereof, or which are payable with respect thereto,
or upon the rents, issues, income or profits thereof, or on the occupancy,
operation, use, possession or activities thereof, whether any or all of the same
be levied directly or indirectly or as excise taxes or as income taxes, and all
taxes, assessments or charges which may be levied on the Obligations, or the
interest thereon (collectively, the "Impositions"). The Mortgagor will deliver
to the Mortgagee, upon request, copies of official receipts or other
satisfactory proof evidencing such payments.
SECTION 1.6. Insurance and Legal Requirements. Subject to Section 1.8
(relating to permitted contests), the Mortgagor, at its expense, will comply in
all material respects, or cause compliance in all material respects with
(a) all provisions of any insurance policy covering or
applicable to the Collateral or any part thereof, all requirements of
the issuer of any such policy, and all orders, rules, regulations and
other requirements of the National Board of Fire Underwriters (or any
other body exercising similar functions) applicable to or affecting the
Collateral or any part thereof or any use or condition of the
Collateral or any part thereof (collectively, the "Insurance
Requirements"); and
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(b) all laws, including Environmental Laws, statutes, codes,
acts, ordinances, orders, judgments, decrees, injunctions, rules,
regulations, permits, licenses, authorizations, directions and
requirements of all governments, departments, commissions, boards,
courts, authorities, agencies, officials and officers, foreseen or
unforeseen, ordinary or extraordinary, which now or at any time
hereafter may be applicable to the Collateral or any part thereof, or
any of the adjoining sidewalks, curbs, vaults and vault space, if any,
streets or ways, or any use or condition of the Collateral or any part
thereof (collectively, the "Legal Requirements");
noncompliance of which could reasonably be expected to cause a Material Adverse
Effect (as defined in the Credit Agreement) whether or not compliance therewith
shall require structural changes in or interference with the use and enjoyment
of the Collateral or any part thereof.
SECTION 1.7. Security Interests, etc. The Mortgagor will not directly
or indirectly create or permit or suffer to be created or to remain, and will
promptly discharge or cause to be discharged, any deed of trust, mortgage,
encumbrance or charge on, pledge of, security interest in or conditional sale or
other title retention agreement with respect to or any other lien on or in the
Collateral or any part thereof or the interest of the Mortgagor or the Mortgagee
therein, or any Proceeds thereof or Rents or other sums arising therefrom, other
than (a) Permitted Encumbrances, and (b) liens of mechanics, materialmen,
suppliers or vendors or rights thereto incurred in the ordinary course of the
business of the Mortgagor for sums not yet due or any such liens or rights
thereto which are at the time being contested as permitted by Section 1.8. The
Mortgagor will not postpone the payment of any sums for which liens of
mechanics, materialmen, suppliers or vendors or rights thereto have been
incurred (unless such liens or rights thereto are at the time being contested as
permitted by Section 1.8), for more than 60 days after the completion of the
action giving rise to such liens or rights thereto.
SECTION 1.8. Permitted Contests. The Mortgagor at its expense may
contest, or cause to be contested, by appropriate legal proceedings conducted in
good faith and with due diligence, the amount or validity or application, in
whole or in part, of any Imposition, Legal Requirement or Insurance Requirement
or lien of a mechanic, materialman, supplier or vendor, provided that, (a) in
the case of an unpaid Imposition, lien, encumbrance or charge, such proceedings
shall suspend the collection thereof from the Mortgagor, the Mortgagee, and the
Collateral (including any rent or other income therefrom) and shall not
materially interfere with the payment of any such rent or income, (b) neither
the Collateral nor any rent or other income therefrom nor any part thereof or
interest therein would be in any material danger of being sold, forfeited, lost,
impaired or interfered with, (c) in the case of a Legal Requirement, neither the
Mortgagor nor the Mortgagee would be in material danger of any civil or criminal
liability for failure to comply therewith, (d) the Mortgagor shall have
furnished such security, if any, as may be required in the proceedings or as may
be reasonably requested by the Mortgagee, (e) the non-payment of the whole or
any part of any Imposition will not result in the delivery of a tax deed to the
Collateral or any part thereof because of such non-payment, (f) the payment of
any sums required to be paid with respect to any of the Senior Secured Notes or
under this Mortgage (other than any unpaid Imposition, lien, encumbrance or
charge at the time being contested in accordance with this Section 1.8) shall
not be interfered with or otherwise affected, (g) in the case of any Insurance
Requirement, the failure of the Mortgagor to comply therewith shall not affect
the validity of any insurance required to be maintained by the Mortgagor under
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Section 2.1, and (h) that adequate reserves, determined in accordance with GAAP,
shall have been set aside on the Mortgagor's books.
SECTION 1.9. Leases. The Mortgagor represents and warrants to the
Mortgagee that, as of the date hereof, there are no written or oral leases or
other agreements of any kind or nature, other than the Permitted Encumbrances,
relating to the occupancy of any portion of the Property by any Person other
than the Mortgagor. Except as is permitted by the Indenture and any Security
Agreements executed pursuant to the Indenture, the Mortgagor will not enter into
any such written or oral lease or other agreement with respect to any portion of
the Property without first obtaining the written consent of the Mortgagee.
SECTION 1.10. Compliance with Instruments. The Mortgagor at its expense
will promptly comply in all material respects with all rights of way or use,
privileges, franchises, servitudes, licenses, easements, tenements,
hereditaments and appurtenances forming a part of the Property and all
instruments creating or evidencing the same, in each case, to the extent
compliance therewith is required of the Mortgagor under the terms thereof.
Except as is permitted by the Indenture and any Security Agreements executed
pursuant to the Indenture, the Mortgagor will not take any action which may
result in a forfeiture or termination of the rights afforded to the Mortgagor
under any such instruments, and will not, without the prior written consent of
the Mortgagee, amend any of such instruments in any manner adverse to the
Holders in any material respect.
SECTION 1.11. Maintenance and Repair, etc. Subject to the provisions of
Section 1.12, the Mortgagor will keep or cause to be kept all presently and
subsequently erected or acquired Improvements and the sidewalks, curbs, vaults
and vault space, if any, located on or adjoining the same, and the streets and
the ways adjoining the same, in good and substantial order and repair and in
such a fashion that neither the value nor utility of the Collateral will be
diminished, and, at its sole cost and expense, will promptly make or cause to be
made all necessary and appropriate repairs, replacements and renewals thereof,
whether interior or exterior, structural or nonstructural, ordinary or
extraordinary, foreseen or unforeseen, so that its business carried on in
connection therewith may be properly conducted at all times. The Mortgagor at
its expense will do or cause to be done all shoring of foundations and walls of
any building or other Improvements on the Property and (to the extent permitted
by law) of the ground adjacent thereto, and every other act necessary or
appropriate for the preservation and safety of the Property by reason of or in
connection with any excavation or other building operation upon the Property and
upon any adjoining property, whether or not the Mortgagor shall, by any Legal
Requirement, be required to take such action or be liable for failure to do so.
SECTION 1.12. Alterations, Additions, etc. So long as no Event of
Default shall have occurred and be continuing, the Mortgagor shall have the
right at any time and from time to time to make or cause to be made reasonable
alterations of and additions to the Property or any part thereof, provided that
any alteration or addition: (a) shall not change the general character or the
use of the Property or reduce the fair market value thereof below its value
immediately before such alteration or addition, or impair the usefulness of the
Property; (b) is effected with due diligence, in a good and workmanlike manner
and in compliance in all material respects with all Legal Requirements and
Insurance Requirements; (c) subject to Section 1.8 is promptly and fully paid
for, or caused to be paid for, by the Mortgagor; and (d) is made, in case the
estimated
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cost of such alteration or addition exceeds U.S. $1,000,000, under the
supervision of a qualified architect or engineer or another professional.
SECTION 1.13. Intentionally Omitted.
SECTION 1.14. Assignment of Rents, Proceeds, etc. The assignment, grant
and conveyance of the Leases, Rents, Proceeds and other rents, income, proceeds
and benefits of the Collateral contained in the Granting Clause of this Mortgage
shall constitute an absolute, present and irrevocable assignment, grant and
conveyance, provided, however, that permission is hereby given to the Mortgagor,
so long as no Event of Default has occurred and be continuing hereunder, to
collect, receive and apply such Rents, Proceeds and other rents, income,
proceeds and benefits as they become due and payable, but not further in advance
thereof than is customary, and in accordance with all of the other terms,
conditions and provisions hereof, of the Indenture, the Senior Secured Notes and
the Security Agreements made pursuant to the terms of the Indenture, and of the
Leases, contracts, agreements and other instruments with respect to which such
payments are made or such other benefits are conferred. Upon the occurrence and
continuance of an Event of Default, such permission shall terminate immediately
and automatically, without notice to the Mortgagor or any other Person except as
required by law, and shall not be reinstated upon a cure of such Event of
Default without the express written consent of the Mortgagee. Such assignment
shall be fully effective without any further action on the part of the Mortgagor
or the Mortgagee and the Mortgagee shall be entitled, at its option, upon the
occurrence and continuance of an Event of Default hereunder, to collect, receive
and apply all Rents, Proceeds and all other rents, income, proceeds and benefits
from the Collateral, including all right, title and interest of the Mortgagor in
any escrowed sums or deposits or any portion thereof or interest therein,
whether or not the Mortgagee takes possession of the Collateral or any part
thereof. The Mortgagor further grants to the Mortgagee the right, at the
Mortgagee's option, upon the occurrence and continuance of an Event of Default
hereunder, to:
(a) enter upon and take possession of the Property for the
purpose of collecting Rents, Proceeds and said rents, income, proceeds
and other benefits;
(b) dispossess by the customary summary proceedings any
tenant, purchaser or other Person defaulting in the payment of any
amount when and as due and payable, or in the performance of any other
obligation, under any Lease, contract or other instrument to which said
Rents, Proceeds or other rents, income, proceeds or benefits relate;
(c) let or convey the Collateral or any portion thereof or any
interest therein; and
(d) apply Rents, Proceeds and such rents, income, proceeds and
other benefits, after the payment of all necessary fees, charges and
expenses, on account of the Obligations in accordance with Section
3.11.
SECTION 1.15. No Claims Against the Mortgagee. Nothing contained in
this Mortgage shall constitute any consent or request by the Mortgagee, express
or implied, for the performance of any labor or the furnishing of any materials
or other property in respect of the Property or any part thereof, or be
construed to permit the making of any claim against the Mortgagee in respect of
labor or services or the furnishing of any materials or other property or
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any claim that any lien based on the performance of such labor or the furnishing
of any such materials or other property is prior to the lien and security
interest of this Mortgage. ALL CONTRACTORS SUBCONTRACTORS, VENDORS AND OTHER
PERSONS DEALING WITH THE PROPERTY, OR WITH ANY PERSONS INTERESTED THEREIN, ARE
HEREBY REQUIRED TO TAKE NOTICE OF THE PROVISIONS OF THIS SECTION.
SECTION 1.16. Indemnification. The Mortgagor will protect, indemnify,
save harmless and defend the Holders, the Mortgagee, and each of its respective
officers, directors, shareholders, employees, representatives and agents
(collectively, the "Indemnified Parties" and individually, an "Indemnified
Party"), from and against any and all liabilities, obligations, claims, damages,
penalties, causes of action, costs and expenses (including, without limitation,
reasonable attorneys' fees and expenses) imposed upon or incurred by or asserted
against any Indemnified Party by reason of (a) ownership of an interest in this
Mortgage, the Indenture, the Senior Secured Notes, any Security Agreement
executed pursuant to the Indenture made pursuant to the terms of the Indenture
or the Property, (b) any accident, injury to or death of persons or loss of or
damage to or loss of the use of property occurring on or about the Property or
any part thereof or the adjoining sidewalks, curbs, vaults and vault spaces, if
any, streets, alleys or ways, (c) any use, non-use or condition of the Property
or any part thereof or the adjoining sidewalks, curbs, vaults and vault spaces,
if any, streets, alleys or ways, (d) any failure on the part of the Mortgagor to
perform or comply with any of the terms of this Mortgage, the Indenture, the
Senior Secured Notes, or any Security Agreement made pursuant to the terms of
the Indenture, (e) performance of any labor or services or the furnishing of any
materials or other property in respect of the Collateral or any part thereof
made or suffered to be made by or on behalf of the Mortgagor, (f) any negligence
or tortious act on the part of the Mortgagor or any of its agents, contractors,
lessees, licensees or invitees, (g) any work in connection with any alterations,
changes, new construction or demolition of or additions to the Property, or (h)
(i) any Hazardous Material on, in, under or affecting all or any portion of the
Property, the groundwater, or any surrounding areas, (ii) any misrepresentation,
inaccuracy or breach of any warranty, covenant or agreement contained or
referred to in Sections 1.21 and 1.22, (iii) any violation or claim of violation
by the Mortgagor of any Environmental Laws, or (iv) the imposition of any lien
for damages caused by or the recovery of any costs for the cleanup, release or
threatened release of any Hazardous Material, except to the extent that any of
the matters described in subsections (a)-(h) arise out of the gross negligence
or willful misconduct of any Indemnified Party. If any action or proceeding be
commenced, to which action or proceeding any Indemnified Party is made a party
by reason of the execution of this Mortgage, the Indenture, the Senior Secured
Notes or any Security Agreement executed pursuant to the Indenture, or in which
it becomes necessary to defend or uphold the lien of this Mortgage, all sums
paid by the Indemnified Parties, for the expense of any litigation to prosecute
or defend the rights and lien created hereby or otherwise, shall be paid by the
Mortgagor to such Indemnified Parties, as the case may be, as hereinafter
provided. The Mortgagor will pay and save the Indemnified Parties harmless
against any and all liability with respect to any intangible personal property
tax or similar imposition of the State or any subdivision or authority thereof
now or hereafter in effect, to the extent that the same may be payable by the
Indemnified Parties in respect of this Mortgage, the Indenture, the Senior
Secured Notes, any Security Agreement executed pursuant to the Indenture or any
other Obligation. All amounts payable to the Indemnified Parties under this
Section 1.16 shall be deemed indebtedness secured by this Mortgage and any such
amounts which are not paid within ten (10) days after written demand therefor by
any Indemnified Party
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shall bear interest at the rate provided for in the Indenture and the Senior
Secured Notes from the date of such demand. In case any action, suit or
proceeding is brought against any Indemnified Party by reason of any such
occurrence, the Mortgagor, upon request of such Indemnified Party, will, at the
Mortgagor's expense, resist and defend such action, suit or proceeding or cause
the same to be resisted or defended by counsel designated by the Mortgagor and
approved by such Indemnified Party. The obligations of the Mortgagor under this
Section 1.16 shall survive any discharge or reconveyance of this Mortgage and
payment in full of the Obligations.
SECTION 1.17. No Credit for Payment of Taxes. The Mortgagor shall not
be entitled to any credit against the Obligations by reason of the payment of
any tax on the Property or any part thereof or by reason of the payment of any
other Imposition, and shall not apply for or claim any deduction from the
taxable value of the Property or any part thereof by reason of this Mortgage.
SECTION 1.18. Intentionally Omitted
SECTION 1.19. No Transfer of the Property. Except as is provided in the
Indenture and other Security Agreements executed pursuant to the Indenture, and
except for the Permitted Encumbrances, the Mortgagor shall not, without the
prior written consent of the Mortgagee, which consent may be granted or withheld
in the sole and absolute discretion of the Mortgagee (i) sell, convey, assign or
otherwise transfer the Property or any portion of the Mortgagor's interest
therein or (ii) further encumber the Property or permit the Property to become
encumbered by any lien, claim, security interest or other indebtedness of any
kind or nature other than the Permitted Encumbrances.
SECTION 1.20. Security Agreement. With respect to the items of personal
property and fixtures referred to and described in the Granting Clause of this
Mortgage and included as part of the Collateral, this Mortgage is hereby made
and declared to be a security agreement encumbering each and every item of
personal property and fixtures now or hereafter owned by Mortgagor and included
herein as a part of the Collateral, in compliance with the provisions of the
Uniform Commercial Code as enacted in the State. In this respect, Mortgagor, as
"Debtor", expressly grants to Mortgagee, as "Secured Party", a security interest
in and to all of the property now or hereafter owned by Mortgagor which
constitutes the personal property and fixtures hereinabove referred to and
described in this Mortgage, including all extensions, accessions, additions,
improvements, betterments, renewals, replacements and substitutions thereof or
thereto, and all proceeds from the sale or other disposition thereof. Mortgagor
agrees that Mortgagee may file this Mortgage, or a reproduction thereof, in the
real estate records or other appropriate index, as, and this Mortgage shall be
deemed to be, a financing statement filed as a fixture filing in accordance with
the laws of the State. Any reproduction of this Mortgage or of any other
security agreement or financing statement executed by Mortgagor shall be
sufficient as a financing statement. In addition, Mortgagor agrees to execute
and deliver to Mortgagee, upon Mortgagee's request, any other security agreement
and financing statements, as well as extensions, renewals, and amendments
thereof, and reproductions of this Mortgage, in such form as Mortgagee may
reasonably require to perfect a security interest with respect to said items.
Mortgagor shall pay all costs of filing such financing statements and any
extensions, renewals, amendments and releases thereof, and shall pay all
reasonable costs and expenses of any record searches for financing statements
Mortgagee may reasonably require. Except as is provided in
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the Indenture and other Security Agreements, and except for the Permitted
Encumbrances, without the prior written consent of Mortgagee, Mortgagor shall
not create or suffer to be created pursuant to the Uniform Commercial Code any
other security interest in the above-described personal property and fixtures,
including any replacements and additions thereto. Upon the occurrence and
continuance of an Event of Default under this Mortgage, the Mortgagee shall have
and shall be entitled to exercise any and all of the rights and remedies (i) as
prescribed in this Mortgage, or (ii) as prescribed by general law, or (iii) as
prescribed by the specific statutory provisions now or hereafter enacted and
specified in said Uniform Commercial Code, all at Mortgagee's sole election.
Mortgagor and Mortgagee agree that the filing of any financing statements in the
records normally having to do with personal property shall not in any way affect
the agreement of Mortgagor and Mortgagee that everything located in, on or
about, or used or intended to be used with or in connection with the use,
operation or enjoyment of, the Collateral, which is described or reflected as a
fixture in this Mortgage, is, and at all times and for all purposes and in all
proceedings, both legal and equitable, shall be, regarded as part of the Real
Estate conveyed hereby. Mortgagor warrants that Mortgagor's name, identity and
address are as set forth herein. The mailing address of the Mortgagee from which
information may be obtained concerning the security interest created herein is
also set forth herein. This information hereof is provided in order that this
Mortgage shall comply with the requirements of the Uniform Commercial Code as
enacted in the State for instruments to be filed as financing statements. In
accordance with the laws of the State, this Mortgage shall remain effective as a
fixture filing until this Mortgage is released or satisfied of record or its
effectiveness otherwise terminates as to the Collateral.
SECTION 1.21. Representations and Warranties. In order to induce the
Mortgagee to enter into this Mortgage, the Indenture and the other Security
Agreements, the Mortgagor agrees that all of the representations and warranties
of Mortgagor set forth in the Indenture and the Security Agreements made
pursuant to the terms of the Indenture are incorporated into this Mortgage by
reference as if fully set forth herein.
SECTION 1.22. Mortgagor's Covenants. In order to induce the Mortgagee
to enter into this Mortgage, the Indenture and the other Security Agreements,
the Mortgagor agrees that all of the covenants of Mortgagor set forth in the
Indenture are incorporated into this Mortgage by reference as if fully set forth
herein.
SECTION 1.23. Attornment. Mortgagee hereby acknowledges and agrees that
the liens granted herein are subject to the rights of certain lessees under the
leases as disclosed in the Credit Agreement set forth on and will be subject to
the rights of lessees under any Leases entered into by Mortgagor after the date
hereof which are permitted as Permitted Liens pursuant to the Credit Agreement,
subject to the express rights contained in the applicable Lease. The rights of
the tenants under the Leases to the leased premises shall not be adversely
affected by the exercise by Mortgagee of any of its rights hereunder, nor shall
any such tenant be in any way deprived of its rights under the applicable Lease
except in accordance with the terms of such Lease. In the event that Mortgagee
succeeds to the interest of Mortgagor under a Lease, such Lease shall not be
terminated or affected thereby except as set forth therein, and any sale of the
applicable leased premises by Mortgagee or pursuant to the judgment of any court
in an action to enforce the remedies provided for in this Mortgage shall be made
subject to such Lease and the rights of such tenant expressly set forth
thereunder. If Mortgagee succeeds to the interests of
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Mortgagor in and to the applicable leased premises or under such Lease or enters
into possession of such leased premises, the Mortgagee, and such tenants, shall
be bound to each other under all of the express terms, covenants and conditions
of such Lease, as if the Mortgagee was originally the Mortgagor as lessor
thereunder.
ARTICLE II
INSURANCE; DAMAGE, DESTRUCTION OR TAKING, ETC.
SECTION 2.1. Insurance.
SECTION 2.1.1. Risks to be Insured. The Mortgagor will, at its expense,
maintain or cause to be maintained with insurance carriers approved by the
Mortgagee (a) insurance with respect to the Improvements against loss or damage
by fire, lightning and such other risks as are included in standard "all-risk"
policies, in amounts sufficient to prevent the Mortgagor and the Mortgagee from
becoming a co-insurer of any partial loss under the applicable policies, but in
any event in amounts not less than the then full insurable value (actual
replacement value) of the Improvements, as determined by the Mortgagor in
accordance with generally accepted insurance practice and approved by the
Mortgagee or, at the request of the Mortgagee, as determined at the Mortgagor's
expense by the insurer or insurers or by an expert approved by the Mortgagee,
(b) comprehensive public liability, including bodily injury and product
liability and property damage, insurance, with personal injury endorsements,
applicable to the Property in such amounts as are customarily carried by Persons
operating similar properties in the same general locality, but in any event with
a combined single limit of not less than Twenty Million Dollars ($20,000,000)
per occurrence, (c) explosion insurance in respect of any steam and pressure
boilers and similar apparatus located in the Property in such amounts as are
usually carried by persons operating similar properties in the same general
locality, but in any event in an amount not less than Twenty Million Dollars
($20,000,000), (d) business interruption insurance (including added expense
coverage) against all insurable perils for a period of not fewer than twelve
(12) months (subject to a reasonable aggregate deductible not exceeding ten (10)
days per any occurrence), (e) worker's compensation insurance to the full extent
required by applicable law for all employees of the Mortgagor engaged in any
work on or about the Property and employer's liability insurance with a limit of
not less than Ten Million Dollars ($10,000,000) for each occurrence, (f)
all-risk, builders' risk insurance with respect to the Property during any
period during which there is any construction work being performed, against loss
or damage by fire or other risks, including vandalism, malicious mischief and
sprinkler leakage, as are included in so-called "extended coverage" clauses at
the time available and (g) such other insurance with respect to the Property in
such amounts and against such insurable hazards as the Mortgagee from time to
time may reasonably require by written notice to the Mortgagor.
SECTION 2.1.2. Policy Provisions. All insurance maintained by the
Mortgagor pursuant to Section 2.1.1 shall (a) (except for worker's compensation
insurance) list the Mortgagee, as additional insureds as its interests may
appear, (b) (except for worker's compensation and public liability insurance)
provide that the proceeds for any losses shall be adjusted by the Mortgagor
subject to the approval of the Mortgagee in the event the proceeds shall exceed
$1,000,000, and shall be payable to the Mortgagee, to be held and applied as
provided in Section 2.3, (c) include effective waivers by the insurer of all
rights of subrogation
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against any named insured, the indebtedness secured by this Mortgage and the
Property and all claims for insurance premiums against the Mortgagee, (d)
(except for worker's compensation and public liability insurance) provide that
any losses shall be payable notwithstanding (i) any act, failure to act or
negligence of or violation of warranties, declarations or conditions contained
in such policy by any named insured, (ii) the occupation or use of the Property
for purposes more hazardous than permitted by the terms thereof, (iii) any
foreclosure or other action or proceeding taken by the Mortgagee pursuant to any
provision of this Mortgage, or (iv) any change in title or ownership of the
Property, (e) provide that no cancellation, reduction in amount or material
change in coverage thereof or any portion thereof shall be effective until at
least thirty (30) days after receipt by the Mortgagee of written notice thereof,
(f) provide that any notice under such policies shall be simultaneously
delivered to the Mortgagee, and (g) be satisfactory in all other reasonable
respects to the Mortgagee. Any insurance maintained pursuant to this Section 2.1
may be evidenced by blanket insurance policies covering the Property and other
properties or assets of the Mortgagor, provided that any such policy shall
specify the portion, if less than all, of the total coverage of such policy that
is allocated to the Property and shall in all other respects comply with the
requirements of this Section 2.1.
SECTION 2.1.3. Delivery of Policies, etc. The Mortgagor will deliver to
the Mortgagee, promptly upon request, (a) certificates of all policies
evidencing all insurance required to be maintained under Section 2.1.1 (or, in
the case of blanket policies, certificates thereof by the insurers together with
a counterpart of each blanket policy), and (b) evidence as to the payment of all
premiums due thereon (with respect to public liability insurance policies, all
installments for the current year due thereon to such date), provided that the
Mortgagee shall not be deemed by reason of its custody of such certificates to
have knowledge of the contents thereof or the applicable policies. The Mortgagor
will also deliver to the Mortgagee prior to the expiration of any policy a
binder or certificate of the insurer evidencing the replacement thereof and when
the new policy is issued a certificate of such new policy (or, in the case of a
replacement blanket policy, a certificate thereof of the insurer together with a
counterpart of the blanket policy). In the event the Mortgagor shall fail to
effect or maintain any insurance required to be effected or maintained pursuant
to the provisions of this Section 2.1, the Mortgagor will indemnify the
Mortgagee against damage, loss or liability resulting from all risks for which
such insurance should have been effected or maintained.
SECTION 2.1.4. Separate Insurance. The Mortgagor will not take out
separate insurance concurrent in form or contributing in the event of loss with
that required to be maintained pursuant to this Section 2.1.
SECTION 2.2. Damage, Destruction or Taking; Mortgagor to Give Notice;
Assignment of Awards. In case of
(a) any material damage to or destruction of the Collateral or
any material part thereof, or
(b) any taking, whether for permanent or temporary use, of all
or any material part of the Collateral or any material interest therein
or material right accruing thereto, as the result of the exercise of
the right of condemnation or eminent domain, or a change of
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grade affecting the Collateral or any portion thereof (a "Taking"), or
the commencement of any proceedings or negotiations which may result in
a Taking,
the Mortgagor will promptly give written notice thereof to the Mortgagee,
generally describing the nature and extent of such damage or destruction and the
Mortgagor's best estimate of the cost of restoring the Collateral, or the nature
of such proceedings or negotiations and the nature and extent of the Taking
which might result therefrom, as the case may be. The Mortgagee shall be
entitled to all insurance proceeds payable on account of such damage or
destruction and to all awards or payments allocable to the Collateral on account
of such Taking up to the amount of the Obligations, and the Mortgagor hereby
irrevocably assigns, transfers and sets over to the Mortgagee all rights of the
Mortgagor to any such proceeds, awards or payments and irrevocably authorizes
and empowers the Mortgagee, at its option, in the name of the Mortgagor or
otherwise, to file and prosecute what would otherwise be the Mortgagor's claim
for any such proceeds, award or payment and to collect, receipt for and retain
the same for disposition in accordance with Section 2.3. The Mortgagor will pay
all reasonable costs and expenses incurred by the Mortgagee in connection with
any such damage, destruction or Taking and seeking and obtaining any insurance
proceeds, awards or payments in respect thereof.
SECTION 2.3. Application of Proceeds and Awards. The Mortgagee may, at
its option, apply all amounts recovered under any insurance policy required to
be maintained by the Mortgagor hereunder and all awards received by it on
account of any Taking in any one or more of the following ways:
(a) to the payment of the reasonable costs and expenses
incurred by the Mortgagee in obtaining any such insurance proceeds or
awards, including the fees and expenses of attorneys and insurance and
other experts and consultants, the costs of litigation, arbitration,
mediation, investigations and other judicial, administrative or other
proceedings and all other out-of-pocket expenses;
(b) to the payment of the principal of the Senior Secured
Notes and any interest (including post-petition interest payable in any
proceedings for bankruptcy under applicable law ("Post-Petition
Interest") to the extent such interest is an Obligation) accrued and
unpaid thereon, without regard to whether any portion or all of such
amounts shall be matured or unmatured, and, in case such amount shall
be insufficient to pay in full all such amounts, then such amount shall
be applied, first, to the payment of all amounts of interest (including
Post-Petition Interest to the extent such interest is an Obligation)
accrued on the Senior Secured Notes and unpaid, second, to the payment
of all amounts of principal at the time outstanding;
(c) to the payment of, or the application to, any Obligation
(other than as provided in clause (b) above);
(d) to fulfill any of the other covenants contained herein, in
the Indenture, the Senior Secured Notes, or Security Agreements
executed pursuant to the Indenture, as the Mortgagee may determine in
its sole discretion;
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(e) to the Mortgagor for application to the cost of restoring
the Collateral and the replacement of Goods destroyed, damaged or
taken; or
(f) to the Mortgagor.
Notwithstanding the foregoing provisions of this Section 2.3 to the contrary
(but subject to the provisions of Section 2.4), and if each of the following
conditions is satisfied, the Mortgagee, upon request of the Mortgagor, shall
apply insurance proceeds or condemnation awards received by it to the
restoration or replacement of the Collateral, to the extent necessary for the
restoration or replacement thereof:
(i) there shall then exist no uncured Event of
Default;
(ii) the Mortgagor shall furnish to the Mortgagee a
certificate of an architect or engineer reasonably acceptable
to the Mortgagee stating (x) that the Collateral is capable of
being restored, prior to the maturity of the Indenture, to
substantially the same condition as existed prior to the
casualty or Taking, (y) the aggregate estimated direct and
indirect costs of such restoration and (z) as to any Taking,
that the property taken in such Taking, or sold under threat
thereof, is not necessary to the Mortgagor's customary use or
occupancy of the Property or Mortgagor otherwise provides
Mortgagee adequate assurance that the Collateral can be
restored or is not necessary to the Mortgagor's customary use
or occupancy of the Property; and
(iii) in the event that the estimated cost of
restoration set forth in the certificate of such architect or
engineer (and such revisions to such estimate as are from time
to time made) exceeds the net insurance proceeds or
condemnation awards actually received from time to time, the
Mortgagor shall deposit the amount of such excess with the
Mortgagee.
In the event that such insurance proceeds or condemnation awards are to
be utilized in the restoration of the Collateral, the Mortgagee shall disburse
such Proceeds and the additional amounts deposited by the Mortgagor for such
restoration after receipt of a written request for disbursement, on not fewer
than five (5) nor more than twelve (12) Business Days notice and, to the extent
applicable, in accordance with the Mortgagee's customary construction loan
procedures and conditions. In the event that such insurance or condemnation
awards are to be utilized to replace the Collateral so destroyed or taken, the
Mortgagee shall disburse such Proceeds after receipt of a written request for
disbursement, on not fewer than five (5) Business Days nor more than twelve (12)
Business Days notice simultaneously with the acquisition of such replacement
property by the Mortgagor. In the event that, after the restoration or
replacement of the Collateral, any insurance or condemnation awards shall
remain, such amount shall be paid to the Mortgagor. Insurance proceeds and
condemnation awards shall be invested in the manner reasonably requested by the
Mortgagor and approved by the Mortgagee, and all interest earned thereon shall
be applied as provided in this Section 2.3. If, prior to the receipt by the
Mortgagee of such insurance proceeds or condemnation awards, the Collateral
shall have been sold on foreclosure, the Mortgagee shall have the right to
receive said insurance proceeds or condemnation awards to the extent of any
deficiency found to be due upon such sale, with legal interest thereon, whether
or not a deficiency judgment shall have been sought or recovered or
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denied, and the reasonable attorneys' fees, costs and disbursements incurred by
the Mortgagee in connection with the collection of such award or payment.
SECTION 2.4. Total Taking and Total Destruction. In the event of a
Total Destruction or a Total Taking, the Mortgagee shall apply all amounts
recovered under any insurance policy referred to in Section 2.1.1 and all awards
received by it on account of any such Taking as follows:
(a) first, to the payment of the reasonable costs and expenses
incurred by the Mortgagee in obtaining any such insurance proceeds or
awards, including the fees and expenses of attorneys and insurance and
other experts and consultants, the costs of litigation, arbitration,
mediation, investigations and other judicial, administrative or other
proceedings and all other out-of-pocket expenses;
(b) second, to the payment of the principal of the Senior
Secured Notes and any interest (including Post-Petition Interest to the
extent such interest is an Obligation) accrued and unpaid thereon,
without regard to whether any portion or all of such amounts shall be
matured or unmatured, and, in case such amount shall be insufficient to
pay in full all such amounts, then such amount shall be applied, first,
to the payment of all amounts of interest (including Post-Petition
Interest to the extent such interest is an Obligation) accrued on the
Senior Secured Notes and unpaid, and second, to the payment of all
amounts of principal at the time outstanding;
(c) third, to the payment of, or the application to, any
Obligation (other than as provided in clause (b) above);
(d) fourth, to fulfill any of the other covenants contained
herein as the Mortgagee may determine; and
(e) fifth, the balance, if any, to the Mortgagor.
ARTICLE III
EVENTS OF DEFAULT; REMEDIES, ETC.
SECTION 3.1. Events of Default; Acceleration. If an "Event of Default"
(pursuant to and as defined in the Indenture) shall have occurred and be
continuing, then and in any such event the Mortgagee may at any time thereafter
(unless all Events of Default shall theretofore have been remedied and all costs
and expenses, including, without limitation, attorneys' fees and expenses
incurred by or on behalf of the Mortgagee, shall have been paid in full by the
Mortgagor) declare, by written notice to the Mortgagor, the Senior Secured Notes
and all other Obligations to be due and payable immediately or on a date
specified in such notice, and on such date the same shall be and become due and
payable, together with interest accrued thereon, without presentment, demand,
protest or notice, all of which the Mortgagor hereby waives. The Mortgagor will
pay on demand all costs and expenses, including, without limitation, attorneys'
fees and expenses, incurred by or on behalf of the Mortgagee in enforcing this
Mortgage, the Indenture, the Senior Secured Notes, or the Security Agreements
executed pursuant to the Indenture or occasioned by any default hereunder or
thereunder.
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SECTION 3.2. Legal Proceedings; Judicial Foreclosure. If an Event of
Default shall have occurred and be continuing, the Mortgagee at any time may, at
its election, proceed at law or in equity or otherwise to enforce the payment
and performance of the Obligations in accordance with the terms hereof and
thereof and to foreclose the lien of this Mortgage as against all or any part of
the Collateral and to have the same sold under the judgment or decree of a court
of competent jurisdiction. The Mortgagee shall be entitled to recover in such
proceedings all costs incident thereto, including attorneys' fees and expenses
in such amounts as may be fixed by the court.
SECTION 3.3. Power of Sale. If an Event of Default shall have occurred
and be continuing, the Mortgagee may grant, bargain, sell, assign, transfer,
convey and deliver the whole or, from time to time, any part of the Collateral,
or any interest in any part thereof, at any private sale or at public auction,
with or without demand, advertisement or notice, for cash, on credit or for
other property, for immediate or future delivery, and for such price or prices
and on such terms as the Mortgagee in its sole discretion may determine, or as
may be required by law, and upon such sale the Mortgagee may execute and deliver
to the purchaser(s) instruments of conveyance pursuant to the terms hereof and
to applicable laws. Without limiting the authority granted in this Section 3.3,
the Mortgagee shall, without demand on the Mortgagor, after the lapse of such
time as may then be required by law, and notice of default and notice of sale
having been given as then required by law, sell the Collateral on the date and
at the time and place designated in the notice of sale, either as a whole or in
separate parcels and in such order as the Mortgagee may determine, but subject
to any statutory right of the Mortgagor to direct the order in which such
property, if consisting of several known lots, parcels or interests, shall be
sold, at public auction to the highest bidder, the purchase price payable in
lawful money of the United States at the time of sale. The Person conducting the
sale may, for any cause deemed expedient, postpone the sale from time to time
until it shall be completed and, in every such case, notice of postponement
shall be given by public declaration thereof by such Person at the time and
place last appointed for the sale; provided that, if the sale is postponed for
longer than one (1) day beyond the day designated in the notice of sale, notice
of sale and notice of the time, date and place of sale shall be given in the
same manner as the original notice of sale. The Mortgagee shall execute and
deliver to the purchaser at any such sale a mortgagee's deed conveying the
property so sold, but without any covenant or warranty, express or implied. The
recitals in such mortgagee's deed of any matters or facts shall be conclusive
proof of the truthfulness thereof. Any Person, including the Mortgagee, may bid
at the sale.
SECTION 3.4. Uniform Commercial Code Remedies. If an Event of Default
shall have occurred and be continuing, the Mortgagee may exercise from time to
time and at any time any rights and remedies available to it under applicable
law upon default in the payment of indebtedness, including, without limitation,
any right or remedy available to it as a secured party under the Uniform
Commercial Code of the State. The Mortgagor shall, promptly upon request by the
Mortgagee, assemble the Collateral, or any portion thereof generally described
in such request, and make it available to the Mortgagee at such place or places
designated by the Mortgagee and reasonably convenient to the Mortgagee or the
Mortgagor. If the Mortgagee elects to proceed under the Uniform Commercial Code
of the State to dispose of portions of the Collateral, the Mortgagee, at its
option, may give the Mortgagor notice of the time and place of any public sale
of any such property, or of the date after which any private sale or other
disposition thereof is to be made, by sending notice by registered or certified
first class mail,
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postage prepaid, to the Mortgagor at least ten (10) days before the time of the
sale or other disposition. If any notice of any proposed sale, assignment or
transfer by the Mortgagee of any portion of the Collateral or any interest
therein is required by law, the Mortgagor conclusively agrees that ten (10) days
notice to the Mortgagor of the date, time and place (and, in the case of a
private sale, the terms) thereof is reasonable.
SECTION 3.5. Mortgagee Authorized to Execute Deeds, etc. The Mortgagor
irrevocably appoints the Mortgagee (which appointment is coupled with an
interest) the true and lawful attorney of the Mortgagor, in its name and stead
and on its behalf, for the purpose of effectuating any sale, assignment,
transfer or delivery for the enforcement hereof, whether pursuant to power of
sale, foreclosure or otherwise, to execute and deliver all such deeds, bills of
sale, assignments, releases and other instruments as may be designated in any
such request.
SECTION 3.6. Purchase of Collateral by Mortgagee. The Mortgagee may be
a purchaser of the Collateral or of any part thereof or of any interest therein
at any sale thereof, whether pursuant to power of sale, foreclosure or
otherwise, and the Mortgagee may apply upon the purchase price thereof the
indebtedness secured hereby owing to the Mortgagee. Such purchaser shall, upon
any such purchase, acquire good title to the properties so purchased, free of
the security interest and lien of this Mortgage and free of all rights of
redemption in the Mortgagor.
SECTION 3.7. Receipt a Sufficient Discharge to Purchaser. Upon any sale
of the Collateral or any part thereof or any interest therein, whether pursuant
to power of sale, foreclosure or otherwise, the receipt of the Mortgagee or the
officer making the sale under judicial proceedings shall be a sufficient
discharge to the purchaser for the purchase money, and such purchaser shall not
be obliged to see to the application thereof.
SECTION 3.8. Waiver of Appraisement, Valuation, etc. The Mortgagor
hereby waives, to the fullest extent it may lawfully do so, the benefit of all
appraisement, valuation, stay, extension and redemption laws now or hereafter in
force and all rights of marshaling in the event of any sale of the Collateral or
any part thereof or any interest therein.
SECTION 3.9. Sale a Bar Against Mortgagor. Any sale of the Collateral
or any part thereof or any interest therein under or by virtue of this Mortgage,
whether pursuant to power of sale, foreclosure or otherwise, shall forever be a
bar against the Mortgagor.
SECTION 3.10. Obligations to Become Due on Sale. Except as otherwise
provided in the Indenture, upon any sale of the Collateral or any portion
thereof or interest therein by virtue of the exercise of any remedy by the
Mortgagee under or by virtue of this Mortgage, whether pursuant to power of
sale, foreclosure or otherwise in accordance with this Mortgage or by virtue of
any other remedy available at law or in equity or by statute or otherwise, at
the option of the Mortgagee, any sums or monies due and payable pursuant to the
Indenture, the Senior Secured Notes or Security Agreements executed pursuant to
the Indenture and in connection with the Obligations shall, if not previously
declared due and payable, immediately become due and payable, together with
interest accrued thereon, and all other indebtedness which this Mortgage by its
terms secures.
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SECTION 3.11. Application of Proceeds of Sale and Other Moneys. Except
as otherwise provided in the Indenture or herein, the proceeds of any sale of
the Collateral or any part thereof or any interest therein under or by virtue of
this Mortgage, whether pursuant to power of sale, foreclosure or otherwise, and
all other moneys at any time held by the Mortgagee as part of the Collateral,
shall be applied in such order of priority as the Mortgagee shall determine in
its sole and absolute discretion including, without limitation, as follows:
(a) first, to the payment of the reasonable costs and expenses
of such sale (including, without limitation, the cost of evidence of
title and the costs and expenses, if any, of taking possession of,
retaining custody over, repairing, managing, operating, maintaining and
preserving the Collateral or any part thereof prior to such sale), all
reasonable costs and expenses incurred by the Mortgagee or any other
Person in obtaining or collecting any insurance proceeds, condemnation
awards or other amounts received by the Mortgagee, all reasonable costs
and expenses of any receiver of the Collateral or any part thereof, and
any Impositions or other charges or expenses prior to the security
interest or lien of this Mortgage, which the Mortgagee may consider it
necessary or desirable to pay;
(b) second, to the payment of any Obligation (other than those
set forth in Section 3.11(c) below);
(c) third, to the payment of all amounts of principal of and
interest (including Post-Petition Interest to the extent such interest
is an Obligation) at the time due and payable under the Indenture at
the time outstanding (whether due by reason of maturity or by reason of
any prepayment requirement or by declaration or acceleration or
otherwise), including interest at the rate provided for in the
Indenture on any overdue principal and (to the extent permitted under
applicable law) on any overdue interest; and, in case such moneys shall
be insufficient to pay in full such principal and interest, then,
first, to the payment of all amounts of interest (including
Post-Petition Interest to the extent such interest is an Obligation) at
the time due and payable and, second, to the payment of all amounts of
principal at the time due and payable under the Senior Secured Notes;
and
(d) fourth, the balance, if any, held by the Mortgagee after
payment in full of all amounts referred to in subdivisions Sections
3.11(a), (b) and (c) above, shall, unless a court of competent
jurisdiction may otherwise direct by final order not subject to appeal,
be paid to or upon the direction of the Mortgagor.
SECTION 3.12. Appointment of Receiver. If an Event of Default shall
have occurred and be continuing, the Mortgagee shall, as a matter of right,
without notice, and without regard to the adequacy of any security for the
indebtedness secured hereby or the solvency of the Mortgagor, be entitled to the
appointment of a receiver for all or any part of the Collateral, whether such
receivership be incidental to a proposed sale of the Collateral or otherwise,
and the Mortgagor hereby consents to the appointment of such a receiver and will
not oppose any such appointment.
SECTION 3.13. Possession, Management and Income. If an Event of Default
shall have occurred and be continuing, in addition to, and not in limitation of,
the rights and remedies
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provided in Section 1.14, the Mortgagee, upon five (5) days written notice to
the Mortgagor, may enter upon and take possession of the Collateral or any part
thereof by force, summary proceeding, ejectment or otherwise and may remove the
Mortgagor and all other Persons and any and all property therefrom and may hold,
operate, maintain, repair, preserve and manage the same and receive all
earnings, income, Rents, issues and Proceeds accruing with respect thereto or
any part thereof. The Mortgagee shall be under no liability for or by reason of
any such taking of possession, entry, removal or holding, operation or
management, except that any amounts so received by the Mortgagee shall be
applied to pay all costs and expenses of so entering upon, taking possession of,
holding, operating, maintaining, repairing, preserving and managing the
Collateral or any part thereof, and any Impositions or other charges prior to
the lien and security interest of this Mortgage which the Mortgagee may consider
it necessary or desirable to pay, and any balance of such amounts shall be
applied as provided in Section 3.11.
SECTION 3.14. Right of Mortgagee to Perform Mortgagor's Covenants, etc.
If the Mortgagor shall fail to make any payment or perform any act required to
be made or performed hereunder or under the Indenture, the Senior Secured Notes,
or the Security Agreements executed pursuant to the Indenture, the Mortgagee,
without notice to or demand upon the Mortgagor and without waiving or releasing
any obligation or Event of Default, may (but shall be under no obligation to) at
any time thereafter make such payment or perform such act for the account and at
the expense of the Mortgagor, and may enter upon the Collateral for such purpose
and take all such action thereon as, in the Mortgagee's opinion, may be
necessary or appropriate therefor. No such entry and no such action shall be
deemed an eviction of any lessee of the Property or any part thereof. All sums
so paid by the Mortgagee and all costs and expenses (including, without
limitation, attorneys' fees and expenses) so incurred, together with interest
thereon at the rate provided for in the Indenture from the date of payment or
incurring, shall constitute additional indebtedness under the Indenture secured
by this Mortgage and shall be paid by the Mortgagor to the Mortgagee on demand.
SECTION 3.15. Subrogation. To the extent that the Mortgagee, on or
after the date hereof, pays any sum due under any provision of any Legal
Requirement or any instrument creating any lien prior or superior to the lien of
this Mortgage, or the Mortgagor or any other Person pays any such sum with the
proceeds of the Senior Secured Notes, the Mortgagee shall have and be entitled
to a lien on the Collateral equal in priority to the lien discharged, and the
Mortgagee shall be subrogated to, and receive and enjoy all rights and liens
possessed, held or enjoyed by, the holder of such lien, which shall remain in
existence and benefit the Mortgagee in securing the Obligations.
SECTION 3.16. Remedies, etc., Cumulative. Each right, power and remedy
of the Mortgagee provided for in this Mortgage, the Indenture, the Senior
Secured Notes, or the Security Agreements executed pursuant to the Indenture or
now or hereafter existing at law or in equity or by statute or otherwise shall
be cumulative and concurrent and shall be in addition to every other right,
power or remedy provided for in this Mortgage, the Indenture, the Senior Secured
Notes or the Security Agreements executed pursuant to the Indenture or now or
hereafter existing at law or in equity or by statute or otherwise, and the
exercise or beginning of the exercise by the Mortgagee of any one or more of the
rights, powers or remedies provided for in this Mortgage, the Indenture, the
Senior Secured Notes, or the Security Agreements executed pursuant to the
Indenture or now or hereafter existing at law or in equity or by statute or
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otherwise shall not preclude the simultaneous or later exercise by the Mortgagee
of any or all such other rights, powers or remedies.
SECTION 3.17. Provisions Subject to Applicable Law. All rights, powers
and remedies provided in this Mortgage may be exercised only to the extent that
the exercise thereof does not violate any applicable provisions of law and are
intended to be limited to the extent necessary so that they will not render this
Mortgage invalid, unenforceable or not entitled to be recorded, registered or
filed under the provisions of any applicable law. If any term of this Mortgage
or any application thereof shall be invalid or unenforceable, the remainder of
this Mortgage and any other application of such term shall not be affected
thereby.
SECTION 3.18. No Waiver, etc. No failure by the Mortgagee to insist
upon the strict performance of any term hereof or of the Indenture, the Senior
Secured Notes, or the Security Agreements executed pursuant to the Indenture or
to exercise any right, power or remedy consequent upon a breach hereof or
thereof, shall constitute a waiver of any such term or of any such breach. No
waiver of any breach shall affect or alter this Mortgage, which shall continue
in full force and effect with respect to any other then existing or subsequent
breach. By accepting payment or performance of any amount or other Obligations
secured hereby before or after its due date, the Mortgagee shall not be deemed
to have waived its right either to require prompt payment or performance when
due of all other amounts and Obligations payable hereunder or to declare a
default for failure to effect such prompt payment.
SECTION 3.19. Compromise of Actions, etc. Any action, suit or
proceeding brought by the Mortgagee pursuant to any of the terms of this
Mortgage, the Indenture, the Senior Secured Notes, or the Security Agreements,
or otherwise, and any claim made by the Mortgagee hereunder or thereunder, may
be compromised, withdrawn or otherwise dealt with by the Mortgagee without any
notice to or approval of the Mortgagor.
ARTICLE IV
DEFINITIONS
SECTION 4.1. Terms Defined in this Mortgage. When used herein the
following terms have the following meanings:
"Borrowers" shall have the meaning set forth in the third recital.
"Collateral" shall have the meaning set forth in the granting clause.
"Contracts" shall have the meaning set forth in clause (g) of the
granting clause.
"Credit Agreement" shall have the meaning set forth in the third
recital.
"Default" means any Event of Default or any condition or event which,
after notice or lapse of time, or both, would constitute an Event of Default.
"First Mortgage Default" means a Default (as defined in the First
Mortgage).
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"Goods" shall have the meaning set forth in clause (c) of the granting
clause.
"herein", "hereof", "hereto", and "hereunder" and similar terms refer
to this Mortgage and not to any particular Section, paragraph or provision of
this Mortgage.
"Impositions" shall have the meaning set forth in Section 1.5.
"Improvements" shall have the meaning set forth in clause (b) of the
granting clause.
"Indemnified Parties" shall have the meaning set forth in Section 1.16.
"Insurance Requirements" shall have the meaning set forth in paragraph
(a) of Section 1.6.
"Land" shall have the meaning set forth in the first recital.
"Leases" shall have the meaning set forth in clause (d) of the granting
clause.
"Legal Requirements" shall have the meaning set forth in paragraph (b)
of Section 1.6.
"Mortgage" shall have the meaning set forth in the preamble.
"Mortgagee" shall have the meaning set forth in the preamble.
"Mortgagor" shall have the meaning set forth in the preamble.
"Obligations" means all liabilities, duties and obligations of the
Mortgagor as the Subsidiary Guarantor under the Indenture, all advances, if any,
made by Mortgagee pursuant to the terms of this Mortgage, and all duties and
obligations of Mortgagor under this Mortgage[, and the Security Agreements
executed pursuant to the terms of the Indenture].
"Permits" shall have the meaning set forth in clause (g) of the
granting clause.
"Permitted Encumbrances" shall have the meaning set forth in Section
1.2.
"Person" means a corporation, an association, a partnership, an
organization, a business, an individual, a government or political subdivision
thereof or a governmental agency or officer.
"Plans" shall have the meaning set forth in clause (f) of the granting
clause.
"Post-Petition Interest" shall have the meaning set forth in Section
2.3.
"Proceeds" shall have the meaning set forth in clause (k) of the
granting clause.
"Property" shall have the meaning set forth in clause (b) of the
granting clause.
"Real Estate" shall have the meaning set forth in clause (a) of the
granting clause.
"Rents" shall have the meaning set forth in clause (j) of the granting
clause.
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"State" means the State of Florida.
"Total Destruction" means any damage to or destruction of the
Improvements or any part thereof which, in the reasonable estimation of the
Mortgagee shall require the expenditure of an amount in excess of Ten Million
Dollars ($10,000,000) to restore the Improvements to substantially the same
condition of the Improvements immediately prior to such damage or destruction.
"Total Taking" means a Taking, whether permanent or for temporary use,
which, in the reasonable judgment of the Mortgagee, shall substantially
interfere with and adversely affect the normal operation of the Property by the
Mortgagor to such an extent as would reasonably be anticipated to cause a
Material Adverse Effect (as defined in the Credit Agreement).
SECTION 4.2. Use of Defined Terms. Terms for which meanings are
provided in this Mortgage shall, unless otherwise defined or the context
otherwise requires, have such meanings when used in any certificate and any
opinion, notice or other communication delivered from time to time in connection
with this Mortgage or pursuant hereto.
SECTION 4.3. Indenture Definitions. Unless otherwise defined herein or
the context otherwise requires, capitalized terms used in this Mortgage,
including its preamble and recitals, have the meanings provided in the
Indenture.
ARTICLE V
MISCELLANEOUS
SECTION 5.1. Further Assurances; Financing Statements.
SECTION 5.1.1. Further Assurances. The Mortgagor, at its expense, will
execute, acknowledge and deliver all such instruments and take all such other
action as the Mortgagee from time to time may reasonably request:
(a) to better subject to the lien and security interest of
this Mortgage all or any portion of the Collateral,
(b) to perfect, publish notice or protect the validity of the
lien and security interest of this Mortgage,
(c) to preserve and defend the title to the Collateral and the
rights of the Mortgagee therein against the claims of all Persons as
long as this Mortgage shall remain undischarged,
(d) in order to further effectuate the purposes of this
Mortgage and to carry out the terms hereof and to better assure and
confirm to the Mortgagee its rights, powers and remedies hereunder.
SECTION 5.1.2. Financing Statements. Notwithstanding any other
provision of this Mortgage, the Mortgagor hereby agrees that, without notice to
or the consent of the Mortgagor,
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the Mortgagee may file with the appropriate public officials such financing
statements, continuation statements, amendments and similar documents as are or
may become necessary to perfect, preserve or protect the security interest
granted by this Mortgage.
SECTION 5.2. Additional Security. Without notice to or consent of the
Mortgagor, and without impairment of the security interest and lien and rights
created by this Mortgage, the Mortgagee and the Lenders may accept from the
Mortgagor or any other Person additional security for the Obligations. Neither
the giving of this Mortgage nor the acceptance of any such additional security
shall prevent the Mortgagee from resorting, first, to such additional security,
or, first, to the security created by this Mortgage, or concurrently to both, in
any case without affecting the Mortgagee's lien and rights under this Mortgage.
SECTION 5.3. Defeasance; Partial Release, etc.
SECTION 5.3.1. Defeasance. If the Senior Secured Notes and all other
amounts owing pursuant to the Indenture and the Security Agreements shall be
repaid in full in accordance with the terms thereof, and if the Mortgagor shall
pay, in full, the principal of and premium, if any, and interest on the
Obligations in accordance with the terms thereof and hereof and all other sums
payable hereunder by the Mortgagor and shall comply with all the terms,
conditions and requirements hereof and of the Obligations, or otherwise as may
be provided in the Indenture, then on such date, the Mortgagee shall, upon the
request of the Mortgagor and at the Mortgagor's sole cost and expense, execute
and deliver such instruments, in form and substance reasonably satisfactory to
the Mortgagee, as may be necessary to effectively reconvey, release and
discharge this Mortgage.
SECTION 5.3.2. Partial Release, etc. The Mortgagee may, at any time and
from time to time, without liability therefor, and without prior notice to the
Mortgagor, release or reconvey any part of the Collateral, consent to the making
of any map or plat of the Property, join in granting any easement thereon or
join in any extension agreement or agreement subordinating the lien of this
Mortgage.
SECTION 5.4. Notices, etc. All notices and other communications
provided to any of the parties hereto shall be in writing and addressed,
delivered or transmitted to such party as set forth in the Indenture.
SECTION 5.5. Waivers, Amendments, etc. The provisions of this Mortgage
may be amended, discharged or terminated and the observance or performance of
any provision of this Mortgage may be waived, either generally or in a
particular instance and either retroactively or prospectively, only by an
instrument in writing executed by the Mortgagor and the Mortgagee.
SECTION 5.6. Cross-References. References in this Mortgage and in each
instrument executed pursuant hereto to any Section or Article are, unless
otherwise specified, to such Section or Article of this Mortgage or such
instrument, as the case may be, and references in any Section, Article or
definition to any clause are, unless otherwise specified, to such clause of such
Section, Article or definition.
SECTION 5.7. Headings. The various headings of this Mortgage and of
each instrument executed pursuant hereto are inserted for convenience only and
shall not affect the
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meaning or interpretation of this Mortgage or such instrument or any provisions
hereof or thereof.
SECTION 5.8. Currency. Unless otherwise expressly stated, all
references to any currency or money, or any dollar amount, or amounts
denominated in "Dollars" herein will be deemed to refer to the lawful currency
of the United States.
SECTION 5.9. Governing Law. THIS MORTGAGE SHALL BE DEEMED TO BE A
CONTRACT MADE UNDER AND GOVERNED BY THE LAWS OF THE STATE.
SECTION 5.10. Successors and Assigns, etc. This Mortgage shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective successors and assigns.
SECTION 5.11. Waiver of Jury Trial; Submission to Jurisdiction.
(a) EACH OF THE MORTGAGOR AND THE MORTGAGEE HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL
BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON OR ARISING OUT OF,
UNDER OR IN CONNECTION WITH THIS MORTGAGE, THE INDENTURE, THE SENIOR
SECURED NOTES, THE SECURITY AGREEMENTS OR ANY OTHER RELATED INSTRUMENT,
OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL
OR WRITTEN), OR ACTIONS OF THE MORTGAGOR OR THE MORTGAGEE. THIS
PROVISION IS A MATERIAL INDUCEMENT FOR THE MORTGAGEE AND THE HOLDERS TO
ENTER INTO THE TRANSACTIONS PROVIDED FOR IN THE INDENTURE.
(b) FOR THE PURPOSE OF ANY ACTION OR PROCEEDING INVOLVING THIS
MORTGAGE, THE INDENTURE, THE SENIOR SECURED NOTES, OR THE SECURITY
AGREEMENTS, THE MORTGAGOR HEREBY EXPRESSLY AND IRREVOCABLY SUBMITS TO
THE NON-EXCLUSIVE JURISDICTION OF ALL FEDERAL AND STATE COURTS LOCATED
IN THE STATE AND CONSENTS THAT IT MAY BE SERVED WITH ANY PROCESS OR
PAPER BY REGISTERED MAIL OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE
STATE IN ACCORDANCE WITH APPLICABLE LAW, PROVIDED A REASONABLE TIME FOR
APPEARANCE IS ALLOWED. THE MORTGAGOR AND MORTGAGEE EACH EXPRESSLY
WAIVES, TO THE EXTENT IT MAY LAWFULLY DO SO, ANY OBJECTION, CLAIM OR
DEFENSE WHICH IT MAY HAVE AT ANY TIME TO THE LAYING OF VENUE OF ANY
ACTION, SUIT OR PROCEEDING ARISING OUT OF THIS MORTGAGE, THE INDENTURE,
THE SENIOR SECURED NOTES, OR THE SECURITY AGREEMENTS IN ANY SUCH COURT,
IRREVOCABLY WAIVES ANY CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDING
BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM AND
FURTHER IRREVOCABLY WAIVES THE RIGHT TO OBJECT, WITH RESPECT TO ANY
SUCH CLAIM, SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT, THAT
SUCH COURT DOES NOT HAVE JURISDICTION OVER THE PERSON OF THE MORTGAGOR.
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NOTHING CONTAINED HEREIN WILL BE DEEMED TO PRECLUDE THE MORTGAGEE FROM
BRINGING AN ACTION AGAINST THE MORTGAGOR IN ANY OTHER JURISDICTION.
SECTION 5.12. Severability; Conflicts. Any provision of this Mortgage,
the Indenture, the Senior Secured Notes, or the Security Agreements which is
prohibited or unenforceable in any jurisdiction shall as to such provision and
such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions of this Mortgage,
the Indenture, the Senior Secured Notes, or the Security Agreements or affecting
the validity or enforceability of such provision in any other jurisdiction. In
the event of any conflict between the terms of this Mortgage and the terms of
the Indenture, the terms of the Indenture shall control.
SECTION 5.13. Security Agreement. This Mortgage is a Security Agreement
executed pursuant to the Indenture and, unless otherwise expressly indicated
herein, shall be construed, administered and applied in accordance with the
terms and provisions thereof.
SECTION 5.14. Usury Savings Clause. It is the intention of the
Mortgagor and the Mortgagee to conform strictly to the usury laws governing the
Indenture, the Senior Secured Notes and the Security Agreements made pursuant to
the Indenture, and any interest payable under the Indenture, the Senior Secured
Notes and the Security Agreements shall be subject to reduction to the amount
not in excess of the maximum non-usurious amount allowed under such laws, as
construed by the courts having jurisdiction over such matters. In the event the
maturity of the Obligations is accelerated by reason of any provision of the
Indenture, the Senior Secured Notes and the Security Agreements made pursuant to
the Indenture, or by reason of an election by the Mortgagee resulting from an
Event of Default, then earned interest may never include more than the maximum
amount permitted by law, computed from the dates of each advance of loan
proceeds under the Indenture until payment, and any interest in excess of the
maximum amount permitted by law shall be canceled automatically or, if
theretofore paid, at the option of the Mortgagee, shall be rebated to the
Mortgagor, or shall be credited on the principal amount of the Obligations or,
if all principal has been repaid, then the excess shall be rebated to the
Mortgagor. If any interest is canceled, credited against principal or rebated to
the Mortgagor in accordance with the foregoing sentence and, if thereafter the
interest payable hereunder is less than the maximum amount permitted by
applicable law, the rate hereunder shall automatically be increased to the
maximum extent possible to permit repayment to the Mortgagee and the Lenders as
soon as possible of any interest in excess of the maximum amount permitted by
law which was earlier canceled, credited against principal or rebated to the
Mortgagor pursuant to the provisions of the foregoing sentence.
SECTION 5.15. Future Advances. This Mortgage is a "Future Advance
Mortgage" under the laws of the State. Any and all future advances under this
Mortgage made within a period not to exceed twenty years and in an amount not to
exceed Four Hundred and Fifty Million Dollars ($450,000,000) and the Indenture
and Security Agreements shall have the same priority as if the future advance
was made on the date that this Mortgage was recorded. This Mortgage shall secure
the Obligations, whenever incurred, such Obligations to be due at the times
provided in the Indenture and Security Agreements. Notice is hereby given that
the Obligations may increase as a result of any defaults hereunder by Mortgagor
due to, for example,
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and without limitation, unpaid interest or late charges, unpaid taxes or
insurance premiums which the Mortgagee elects to advance, defaults under leases
that the Mortgagee elects to cure, attorney fees or costs incurred in enforcing
the Indenture and Security Agreements or other expenses incurred by the
Mortgagee in protecting the Collateral, the security of this Mortgage or the
Mortgagee's rights and interests.
SECTION 5.16. Subordination to First Mortgage.
(a) The lien of this Mortgage shall be subject and subordinate
only to the lien of the First Mortgage and Permitted Encumbrances.
Notwithstanding anything to the contrary contained in this Mortgage,
this Mortgage shall not be subordinate to any increases in the
aggregate principal amount that may be borrowed (i) under the First
Mortgage or other documents executed in connection therewith, or (ii)
under any amendment, modifications, renewals, replacements or
consolidations thereof, made without the prior written consent of
Mortgagee, to an amount in excess of $70,000,000.
(b) Mortgagor represents and warrants that (i) the First
Mortgage is in full force and effect, and (ii) all principal, interest
and other amounts payable under the terms, covenants, conditions and
provisions of the First Mortgage and the other documents executed in
connection therewith have been and shall be paid in accordance with the
terms, covenants, conditions and provisions thereof.
(c) Mortgagor covenants and agrees that Mortgagor shall: (i)
promptly and faithfully observe, perform and comply with all the terms,
covenants, conditions and provisions of the First Mortgage and other
documents executed in connection therewith; (ii) not modify, or amend,
or in any way alter or permit the alteration of any of the terms,
covenants, conditions or provisions of the First Mortgage or the other
documents executed in connection therewith in a manner that will
increase the aggregate principal amount of indebtedness that may be
borrowed under the First Mortgage and the other documents executed in
connection therewith the repayment of which is secured by the First
Mortgage to an amount in excess of $70,000,000; (iii) promptly deliver
to Mortgagee a copy of each notice of a First Mortgage Default received
or delivered by Mortgagor in connection with the First Mortgage; and
(iv) furnish to Mortgagee copies of such additional information and
evidence as Mortgagee reasonably may require concerning Mortgagor's due
observance, performance and compliance with the terms, covenants,
conditions, and provisions of the First Mortgage and the other
documents executed in connection therewith (including, but without
limiting the generality of the foregoing, evidence, reasonably
satisfactory to Mortgagee, of the payment by Mortgagor of principal,
interest and other amounts required by the terms, covenants, conditions
and provisions of the First Mortgage and the other documents executed
in connection therewith).
(d) Upon the occurrence and during the continuance of a First
Mortgage Default, in addition to any other rights and remedies that may
be available to Mortgagee, Mortgagee may, but shall not be obligated
to, cure such First Mortgage Default and Mortgagee shall be subrogated
to the rights of the holder of the First Mortgage against Mortgagor and
the Property. To the extent Mortgagee makes any payment of any
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installment of interest or any payment of principal or other sum due
under the First Mortgage and/or any note secured thereby, such payment
(i) shall be deemed to be an Obligation secured hereby, (ii) shall be a
lien on the Property prior to any right or title to, interest in, or
claim upon the Property subordinate to the lien of this Mortgage, and
(iii) shall accrue interest at a rate equal to the lower of (a)
eighteen percent (18%) per annum or (b) the maximum rate permitted by
law.
(e) If for any reason the indebtedness secured by the First
Mortgage is accelerated, or the Property or any part thereof is sold,
or attempted to be sold, pursuant to the First Mortgage, whether by
power of sale, judicial action or otherwise, or any other remedial
action or proceeding is taken or instituted in respect of the Property
or any part thereof under the First Mortgage, Mortgagor will indemnify
and hold Mortgagee harmless from any loss, cost or expense incurred by
Mortgagee, including reasonable attorneys' fees, in contesting any such
action taken or instituted, or incurred by Mortgagee on account of the
acceleration of the indebtedness secured by the First Mortgage, the
sale of the Property pursuant thereto or Mortgagee's purchase or
payment of the First Mortgage.
(f) Mortgagor does herewith irrevocably appoint and constitute
Mortgagee as its true and lawful attorney-in-fact in its name, place
and stead to, upon the occurrence and during the continuance of a First
Mortgage Default, perform and comply with all obligations of Mortgagor
under the First Mortgage, to do and take, without any obligation to do
so, any action as Mortgagee deems necessary or desirable to cure any
First Mortgage Default. Mortgagor shall, within five (5) days after
written request is made therefor by Mortgagee, execute and deliver to
Mortgagee or to any person which Mortgagee shall designate, such
further instruments, agreements, powers, deeds, conveyances or the like
as may be reasonably necessary to complete or perfect the interest,
rights or powers of Mortgagee pursuant to this paragraph.
(g) Upon receipt by Mortgagee of any notice of a First
Mortgage Default, Mortgagee may rely thereon and take any such
reasonable action as Mortgagee shall reasonably deem necessary ,
irrespective of whether the existence of such First Mortgage Default or
the nature thereof be questioned or denied by or on behalf of
Mortgagor.
Notwithstanding anything to the contrary contained in this Mortgage,
and each of the terms, conditions and provisions hereof, the Mortgagee's rights
and remedies hereunder are and at all times shall be subject and subordinate to
the First Mortgage and shall be subject to the terms of the Senior Debt
Intercreditor Agreement. The Mortgagee agrees to execute a subordination
agreement if requested by Senior Lender or any lender under any refinancing of
the indebtedness secured by the First Mortgage.
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IN WITNESS WHEREOF, the undersigned, by its duly elected officers and
pursuant to proper authority of its board of directors has duly executed,
sealed, acknowledged and delivered this instrument as of the day and year first
above written.
MORTGAGOR:
STERLING FIBERS, INC.,
a Delaware corporation
By:
-------------------------------------------
Name:
--------------------------------------
Title:
Witnessed and acknowledged in the presence of:
---------------------------------------------
Name:
---------------------------------------------
Name:
DRAFTED BY:
▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
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[CORPORATE NOTARY PAGE]
MULTI-STATE CORPORATE ACKNOWLEDGMENT
State of New York
County of New York
On this _______________ day of July, 1999, before me, the undersigned officer,
personally appeared
______________________________, with a residence at _____________________,
personally known and acknowledged himself/herself/themselves to me, or produced
_________________________________ as identification, to be the
_______________ President
of ______________________________, (hereinafter, the "Corporation")
and that as such officer(s), being duly authorized to do so pursuant to its
bylaws or a resolution of its board of directors, executed, subscribed and
acknowledged the foregoing instrument for the purposes therein contained, by
signing the name of the Corporation by himself/herself/ themselves in their
authorized capacities as such officer(s) as his/her/their free and voluntary act
and deed and the free and voluntary act and deed of said Corporation.
In Witness Whereof, I hereunto set my hand and official seal.
------------------------------------
Notary Public
Notarial Seal My Commission Expires:
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EXHIBIT A
Legal Description of the Land
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EXHIBIT B
Permitted Encumbrances
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