Loan No. V_33127
NORFOLK FIRST LLC, as grantor
(Borrower)
to
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇., as trustee
(Trustee)
for the benefit of
JPMORGAN CHASE BANK, as beneficiary
(Lender)
-----------------------------
DEED OF TRUST AND
SECURITY AGREEMENT
-----------------------------
Dated: October 17, 2002
PREPARED BY AND UPON
RECORDATION RETURN TO:
▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
Loan Amount - $10,500,000.00
THIS INSTRUMENT WAS PREPARED OUTSIDE THE COMMONWEALTH OF VIRGINIA.
TABLE OF CONTENTS
PAGE
----
1 - GRANTS OF SECURITY .................................................. 3
Section 1.1 PROPERTY CONVEYED ......................................... 3
Section 1.2 ASSIGNMENT OF RENTS ....................................... 6
Section 1.3 DEFINITION OF PERSONAL PROPERTY ........................... 6
Section 1.4 PLEDGE OF MONIES HELD ..................................... 6
2 - DEBT AND OBLIGATIONS SECURED ........................................ 7
Section 2.1 DEBT ...................................................... 7
Section 2.2 OTHER OBLIGATIONS ......................................... 7
Section 2.3 DEBT AND OTHER OBLIGATIONS ................................ 7
Section 2.4 PAYMENTS .................................................. 8
3 - BORROWER COVENANTS .................................................. 8
Section 3.1 INCORPORATION BY REFERENCE ................................ 8
Section 3.2 INSURANCE ................................................. 8
Section 3.3 PAYMENT OF TAXES, ETC ..................................... 14
Section 3.4 CONDEMNATION .............................................. 15
Section 3.5 USE AND MAINTENANCE OF PROPERTY ........................... 15
Section 3.6 WASTE ..................................................... 16
Section 3.7 COMPLIANCE WITH LAWS; ALTERATIONS ......................... 16
Section 3.8 BOOKS AND RECORDS.......................................... 17
Section 3.9 PAYMENT FOR LABOR AND MATERIALS ........................... 18
Section 3.10 PERFORMANCE OF OTHER AGREEMENTS .......................... 18
ARTICLE 4 - SPECIAL COVENANTS ........................................... 18
Section 4.1 PROPERTY USE .............................................. 19
Section 4.2 ERISA ..................................................... 19
Section 4.3 SINGLE PURPOSE ENTITY ..................................... 19
ARTICLE 5 - REPRESENTATIONS AND WARRANTIES .............................. 22
Section 5.1 BORROWER'S REPRESENTATIONS ................................ 22
Section 5.2 WARRANTY OF TITLE ......................................... 22
Section 5.3 STATUS OF PROPERTY ........................................ 22
Section 5.4 NO FOREIGN PERSON ......................................... 23
Section 5.5 SEPARATE TAX LOT .......................................... 23
ARTICLE 6 - OBLIGATIONS AND RELIANCES, .................................. 23
Section 6.1 RELATIONSHIP OF BORROWER AND LENDER ....................... 23
Section 6.2 NO RELIANCE ON LENDER ..................................... 24
Section 6.3 NO LENDER OBLIGATIONS ..................................... 24
Section 6.4 RELIANCE................................................... 24
ARTICLE 7 - FURTHER ASSURANCES .......................................... 24
Section 7.1 RECORDING FEES ............................................ 24
Section 7.2 FURTHER ACTS .............................................. 25
Section 7.3 CHANGES IN TAX, DEBT CREDIT AND DOCUMENTARY STAMP LAWS .... 25
Section 7.4 CONFIRMATION STATEMENT .................................... 25
Section 7.5 SPLITTING OF SECURITY INSTRUMENT .......................... 26
Section 7.6 REPLACEMENT DOCUMENTS ..................................... 26
ARTICLE 8 - DUE ON SALE/ENCUMBRANCE ..................................... 26
i
Section 8.1 LENDER RELIANCE ........................................... 26
Section 8.2 NO SALE/ENCUMBRANCE ....................................... 27
Section 8.3 EXCLUDED AND PERMITTED TRANSFERS .......................... 27
Section 8.4 NO IMPLIED FUTURE CONSENT ................................. 29
Section 8.5 COSTS OF CONSENT .......................................... 30
Section 8.6 CONTINUING SEPARATENESS REQUIREMENTS ...................... 30
ARTICLE 9 - DEFAULT ..................................................... 30
Section 9.1 EVENTS OF DEFAULT ......................................... 30
Section 9.2 DEFAULT INTEREST .......................................... 32
ARTICLE 10 - RIGHTS AND REMEDIES ........................................ 32
Section 10.1 REMEDIES ................................................. 32
Section 10.2 RIGHT OF ENTRY ........................................... 38
ARTICLE 11 - INDEMNIFICATION; SUBROGATION ............................... 38
Section 11.1 GENERAL INDEMNIFICATION .................................. 38
Section 11.2 ENVIRONMENTAL INDEMNIFICATION ............................ 40
Section 11.3 DUTY TO DEFEND AND ATTORNEYS AND OTHER FEES AND EXPENSES.. 42
Section 11.4 SURVIVAL OF INDEMNITIES .................................. 42
ARTICLE 12 - SECURITY AGREEMENT ......................................... 42
Section 12.1 SECURITY AGREEMENT ....................................... 42
ARTICLE 13 - WAIVERS .................................................... 43
Section 13.1 MARSHALLING AND OTHER MATTERS ............................ 43
Section 13.2 WAIVER OF NOTICE ......................................... 44
Section 13.3 SOLE DISCRETION OF LENDER ................................ 44
Section 13.4 SURVIVAL ................................................. 44
Section 13.5 WAIVER OF TRIAL BY JURY .................................. 44
Section 13.6 WAIVER OF AUTOMATIC OR SUPPLEMENTAL STAY ................. 45
ARTICLE 14 - NOTICES .................................................... 45
Section 14.1 NOTICES .................................................. 45
ARTICLE 15 - APPLICABLE LAW ............................................. 46
Section 15.1 GOVERNING LAW; JURISDICTION .............................. 46
Section 15.2 USURY LAWS ............................................... 46
Section 15.3 PROVISIONS SUBJECT TO APPLICABLE LAW ..................... 47
ARTICLE 16 - SECONDARY MARKET ........................................... 47
Section 16.1 TRANSFER OF LOAN ......................................... 47
ARTICLE 17 - COSTS ...................................................... 47
Section 17.1 PERFORMANCE AT BORROWER'S EXPENSE ........................ 47
Section 17.2 ATTORNEY'S FEES FOR ENFORCEMENT .......................... 48
ARTICLE 18 - DEFINITIONS ................................................ 48
Section 18.1 GENERAL DEFINITIONS ...................................... 48
ARTICLE 19 - MISCELLANEOUS PROVISIONS ................................... 48
Section 19.1 NO ORAL CHANGE ........................................... 48
Section 19.2 LIABILITY ................................................ 48
Section 19.3 IN APPLICABLE PROVISIONS ................................. 48
Section 19.4 HEADINGS, ETC. ........................................... 49
Section 19.5 DUPLICATE ORIGINALS; COUNTERPARTS ........................ 49
Section 19.6 NUMBER AND GENDER ........................................ 49
Section 19.7 SUBROGATION .............................................. 49
ii
Section 19.8 ENTIRE AGREEMENT ......................................... 49
ARTICLE 20 - TRUSTEE .................................................... 52
ARTICLE 21 - SPECIAL COMMONWEALTH OF VIRGINIA PROVISIONS ................
iii
Index of Defined Terms
"ADA" ................................................................... 15
"Applicable Laws" ....................................................... 15
"attorneys' fees ........................................................ 47
"attorneys" ............................................................. 38
"Bankruptcy Code" ....................................................... 2
"Borrower" ............................................................. 1,47
"Business Day" .......................................................... 45
"Collateral" ............................................................ 41
"counsel fees" .......................................................... 47
"Debt" .................................................................. 5
"Default Rate" .......................................................... 31
"Environmental Indemnity" ............................................... 6
"Environmental Law" ..................................................... 39
"Environmental Lien" .................................................... 39
"ERISA" ................................................................. 17
"Escrow Agreement" ...................................................... 3
"Event of Default" ...................................................... 28
"Event" ................................................................. 46
"Exculpated Portion" .................................................... 36
"fees and expenses" ..................................................... 38
"Guarantor" ............................................................. 19
"Hazardous Substances" .................................................. 39
"Improvements" .......................................................... 1
"Indemnified Parties" ................................................... 40
"Indemnitor" ............................................................ 6
"Insurance Premiums" .................................................... 9
"Insured Casualty" ...................................................... 11
"Intangibles" ........................................................... 4
"Investor" .............................................................. 46
"Land" .................................................................. 1
"Lease" ................................................................. 2
"Leases" ................................................................ 2
"legal fees" ............................................................ 47
"Lender" ................................................................ 1,47
"Loan Documents" ........................................................ 6
"Loan" .................................................................. 27
"Losses" ................................................................ 40
"Note" .................................................................. 1,47
"Obligations ............................................................ 5
"Original Principals" ................................................... 26
"Other Charges" ..................................:...................... 12
"Other Loan Documents" .................................................. 6
"Other Obligations" ..................................................... 5
"Permitted Exceptions" .................................................. 20
"person" ................................................................ 47
Index - 1
"Personal Property ...................................................... 4
"Policies" .............................................................. 9
"Policy" ................................................................ 9
"Principal" ............................................................. 18
"Property"' ............................................................. 1,47
"Qualified Insurer" ..................................................... 9
"Rating Agency" ......................................................... 46
"Release" ............................................................... 40
"Remediation" ........................................................... 40
"Rents" ................................................................. 2
"Securities" ............................................................ 46
"Security Instrument" ................................................... 1
"Taxes" ................................................................. 12
"Trustee" ............................................................... 1
"Uniform Commercial Code" ............................................... 2
Index - 2
THIS DEED OF TRUST AND SECURITY AGREEMENT (this "SECURITY INSTRUMENT")
is made as of the 17th day of October, 2002, by NORFOLK FIRST LLC, a Delaware
limited liability company, having its principal place of business at c/o First
Potomac Realty Investment Trust, Inc., ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇▇ ("BORROWER"), to ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇. ("TRUSTEE"), having his principal
place of business at c/o Tri-State Commercial Closings, Inc., ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇,
▇.▇., ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇, for the benefit of JPMORGAN CHASE BANK,
a New York banking corporation, having its principal place of business at ▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, as beneficiary ("LENDER").
RECITALS:
Borrower by its Note of even date herewith given to Lender is indebted
to Lender in the principal sum of $10,500,000.00 in lawful money of the United
States of America (such Note, together with all extensions, renewals,
modifications, substitutions and amendments thereof, shall collectively be
referred to as the "NOTE"), with interest from the date thereof at the rates set
forth in the Note, principal and interest to be payable in accordance with the
terms and conditions provided in the Note, and with a final maturity date of
November 10, 2007.
Borrower desires to secure the payment of the Debt (as defined in
Article 2) and the performance of all of its obligations under the Note and the
Other Obligations (as defined in Article 2). The Note is also secured by that
certain Deed of Trust and Security Agreement of even date herewith executed by
GTC II First LLC, a Delaware limited liability company and a co-maker of the
Note, to ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇., as Trustee for the benefit of Lender, covering
the real property described on Exhibit B attached hereto and made a part hereof.
Payment of the Debt is allocated between the properties described on Exhibit A
and Exhibit B as follows: Exhibit A - $5,100,000.00; Exhibit B - $5,400,000.00.
ARTICLE 1 - GRANTS OF SECURITY
Section 1.1 PROPERTY CONVEYED. Borrower does hereby irrevocably,
unconditionally and absolutely, grant, bargain, sell, pledge, enfeoff, assign,
warrant, transfer and convey to Trustee (with power of sale) in trust for the
purposes herein set forth, the following property, rights, interests and estates
now owned, or hereafter acquired, by Borrower (collectively, the "PROPERTY"):
(a) Land. The real property described in Exhibit A attached
hereto and made a part hereof (collectively, the "LAND"), together with
additional lands estates and development rights hereafter acquired by
Borrower for use in connection with the development, ownership or
occupancy of such real property, and all additional lands and estates
therein which may, from time to time, by supplemental deed of trust or
otherwise be expressly made subject to the lien of this Security
Instrument;
(b) Improvements. The buildings, structures, fixtures,
additions, accessions, enlargements, extensions, modifications,
repairs, replacement and improvements now or hereafter erected or
located on the Land (the "IMPROVEMENTS");
JPMORGAN CHASE BANK
(c) Easements. All easements, rights-of-way or use, rights,
strips and gores of land, streets, ways, alleys, passages, sewer
rights, water, water courses, water rights and powers, air rights and
development rights, and all estates, rights, titles, interests,
privileges, liberties, servitudes, tenements, hereditaments and
appurtenances of any nature whatsoever, in any way now or hereafter
belonging, relating or pertaining to the Land and the Improvements and
the reversion and reversions, remainder and remainders, and all land
lying in the bed of any street, road or avenue, opened or proposed, in
front of or adjoining the Land, to the center line thereof and all the
estates, rights, titles, interests, dower and rights of dower, curtesy
and rights of curtesy, property, possession, claim and demand
whatsoever, both at law and in equity, of Borrower of, in and to the
Land and the Improvements and every part and parcel thereof, with the
appurtenances thereto;
(d) Fixtures and Personal Property. All machinery, equipment,
goods, inventory, consumer goods, fixtures (including, but not limited
to, all heating, air conditioning, plumbing, lighting, communications
and elevator fixtures) and other property of every kind and nature
whatsoever owned by Borrower, or in which Borrower has or shall have an
interest, now or hereafter located upon the Land and the Improvements,
or appurtenant thereto, and usable in connection with the present or
future use, maintenance, enjoyment, operation and occupancy of the Land
and the Improvements and all building equipment, materials and
supplies of any nature whatsoever owned by Borrower, or in which
Borrower has or shall have an interest, now or hereafter located upon
the Land and the Improvements, or appurtenant thereto, or usable in
connection with the present or future operation and occupancy of the
Land and the Improvements, and the right, title and interest of
Borrower in and to any of the Personal Property (as hereinafter
defined) which may be subject to any security interests, as defined in
the Uniform Commercial Code, as adopted and enacted by the state or
states where any of the Property is located (the "UNIFORM COMMERCIAL
CODE"), superior in lien to the lien of this Security Instrument and
all proceeds and products of the above;
(e) Leases and Rents. All leases and other agreements
affecting the use, enjoyment or occupancy of the Land and the
Improvements heretofore or hereafter entered into, whether before or
after filing by or against Borrower of any petition for relief under 11
U.S.C. Section 101 et seq., as the same may be amended from time to
time (the "BANKRUPTCY CODE") (individually, a "LEASE"; collectively,
the "LEASES") and all right, title and interest of Borrower, its
successors and assigns therein and thereunder, including, without
limitation, cash or securities deposited thereunder to secure the
performance by the lessees of their obligations thereunder and all
rents (including all tenant security and other deposits), additional
rents, revenues, issues and profits (including all oil and gas or other
mineral royalties and bonuses) from the Land and the Improvements
whether paid or accruing before or after the filing by or against
Borrower of any petition for relief under the Bankruptcy Code
(collectively the "RENTS") and all proceeds from the sale or other
disposition of the Leases and the right to receive and apply the Rents
to the payment of the Debt;
(f) Condemnation Awards. All awards or payments, including
interest thereon, which may heretofore and hereafter be made with
respect to the Property, whether from the exercise of the right of
eminent domain (including but not limited to any transfer
JPMORGAN CHASE BANK
4
made in lieu of or in anticipation of the exercise of the right), or
for a change of grade, or for any other injury to or decrease in the
value of the Property;
(g) Insurance Proceeds. All proceeds of and any unearned
premiums on any insurance policies covering the Property, including,
without limitation, the right to receive and apply the proceeds of any
insurance, judgments, or settlements made in lieu thereof, for damage
to the Property;
(h) Tax Certiorari. All refunds, rebates or credits in
connection with a reduction in real estate taxes and assessments
charged against the Property as a result of tax certiorari or any
applications or proceedings for reduction;
(i) Conversion. All proceeds of the conversion, voluntary or
involuntary, of any of the foregoing including, without limitation,
proceeds of insurance and condemnation awards, into cash or liquidation
claims;
(j) Rights. The right, in the name and on behalf of Borrower,
to appear in and defend any action or proceeding brought with respect
to the Property and to commence any action or proceeding to protect the
interest of Trustee and/or Lender in the Property;
(k) Agreements. All agreements, contracts (including purchase,
sale, option, right of first refusal and other contracts pertaining to
the Property), certificates, instruments, franchises, permits,
licenses, approvals, consents, plans, specifications and other
documents, now or hereafter entered into, and all rights therein and
thereto, respecting or pertaining to the use, occupation, construction,
management or operation of the Property (including any Improvements or
respecting any business or activity conducted on the Land and any part
thereof) and all right, title and interest of Borrower therein and
thereunder, including, without limitation, the right, upon the
happening of any default hereunder, to receive and collect any sums
payable to Borrower thereunder;
(l) Trademarks. All tradenames, trademarks, servicemarks,
logos, copyrights, goodwill, books and records and all other general
intangibles relating to or used in connection with the operation of the
Property;
(m) Accounts. All accounts, accounts receivable, escrows
(including, without limitation, all escrows, deposits, reserves and
impounds established pursuant to that certain Escrow Agreement for
Reserves and Impounds of even date herewith between Borrower and
Lender; hereinafter, the "ESCROW AGREEMENT"), documents, instruments,
chattel paper, claims, reserves (including deposits) representations,
warranties and general intangibles, as one or more of the foregoing
terms may be defined in the Uniform Commercial Code, and all contract
rights, franchises, books, records, plans, specifications, permits,
licenses (to the extent assignable), approvals, actions, choses,
claims, suits, proofs of claim in bankruptcy and causes of action which
now or hereafter relate to, are derived from or are used in connection
with the Property, or the use, operation, maintenance, occupancy or
enjoyment thereof or the conduct of any business or activities thereon
(hereinafter collectively called the "INTANGIBLES");
JPMORGAN CHASE BANK
5
(n) Cap Agreement. All of Borrower's right, title and interest
in and to all payments to be made to Borrower pursuant to that certain
Interest Rate Cap Agreement dated an even date herewith (the "Cap
Agreement") by and between Borrower and the Cap Seller (as defined in
the Cap Agreement); and
(o) Other Rights. Any and all other rights of Borrower in and
to the Property and any accessions, renewals, replacements and
substitutions of all or any portion of the Property and all proceeds
derived from the sale, transfer, assignment or financing of the
Property or any portion thereof.
Section 1.2 ASSIGNMENT OF RENTS. Borrower hereby absolutely and
unconditionally assigns to Lender Borrower's right, title and interest in and to
all current and future Leases and Rents; its being intended by Borrower that
this assignment constitutes a present, absolute and unconditional assignment and
not an assignment for additional security only. Unless provided to the contrary
in the Cash Management Agreement between Borrower and Lender of even date
herewith (the "Cash Management Agreement"), all payments due under the Leases
shall be paid directly by the tenants thereunder to an account provided for in
the Cash Management Agreement when such amounts are due and payable. All such
payments received in such account shall be applied as set forth in the Cash
Management Agreement. The Payment of amounts due under the Leases directly to an
account as required by the Cash Management Agreement, this Section 1.2 and by
the Assignment of Leases and Rents shall not limit, reduce or otherwise affect
Borrower's obligations to make payments of amounts due hereunder and under the
other Loan Documents, unless pursuant to the terms of the Cash Management
Agreement Lender has received and applied amounts sufficient to make such
payments.
Section 1.3 DEFINITION OF PERSONAL PROPERTY. For purposes of this
Security Instrument, the Property identified in Subsections 1.1(d) through
1.1(o), inclusive, shall be collectively referred to herein as the "PERSONAL
PROPERTY."
Section 1.4 PLEDGE OF MONIES HELD. Borrower hereby pledges to Lender
any and all monies now or hereafter held by Lender, including, without
limitation, any sums deposited in the Funds (as defined in the Escrow
Agreement), all insurance proceeds described in Section 3.2 and condemnation
awards or payments described in Section 3.4 , as additional security for the
Obligations until expended or applied as provided in this Security Instrument.
CONDITIONS TO GRANT
TO HAVE AND TO HOLD the above granted and described Property unto and
to the use and benefit of Trustee, and the successors and assigns of Trustee,
forever;
PROVIDED, HOWEVER, these presents are upon the express condition that,
if Borrower shall well and truly pay to Lender the Debt at the time and in the
manner provided in the Note and this Security Instrument, shall well and truly
perform the Other Obligations as set forth in this Security Instrument and shall
well and truly abide by and comply with each and every covenant and condition
set forth herein and in the Note, these presents and the estate hereby granted
shall cease, terminate and be void; provided however, that Borrower's obligation
to indemnify and hold harmless Lender pursuant to the provisions hereof with
respect to matters
JPMORGAN CHASE BANK
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relating to any period of time during which this Security Instrument was in
effect shall survive any such payment or release.
ARTICLE 2 - DEBT AND OBLIGATIONS SECURED
Section 2.1 DEBT. This Security Instrument and the grants, assignments
and transfers made in Article 1 are given for the purpose of securing the
following, in such order of priority as Lender may determine in its sole
discretion (the "DEBT");
(a) the payment of the indebtedness evidenced by the Note in
lawful money of the United States of America;
(b) the payment of interest, default interest, late charges
and other sums, as provided in the Note, this Security Instrument or
the Other Loan Documents (as hereinafter defined);
(c) the payment of all other moneys agreed or provided to be
paid by Borrower in the Note, this Security Instrument or the Other
Loan Documents;
(d) the payment of all sums advanced pursuant to this Security
Instrument to protect and preserve the Property and the lien and the
security interest created hereby; and
(e) the payment of all sums advanced and costs and expenses
incurred by Lender in connection with the Debt or any part thereof, any
renewal, extension, or change of or substitution for the Debt or any
part thereof, or the acquisition or perfection of the security
therefor, whether made or incurred at the request of Borrower or
Lender.
Section 2.2 OTHER OBLIGATIONS. This Security Instrument and the grants,
assignments and transfers made in Article 1 are also given for the purpose of
securing the following (the "OTHER OBLIGATIONS"):
(a) the performance of all other obligations of Borrower
contained herein;
(b) the performance of each obligation of Borrower contained
in any other agreement given by Borrower to Lender which is for the
purpose of further securing the obligations secured hereby, and any
amendments, modifications and changes thereto; and
(c) the performance of each obligation of Borrower contained
in any renewal, extension, amendment, modification, consolidation,
change of, or substitution or replacement for, all or any part of the
Note, this Security Instrument or the Other Loan Documents.
Section 2.3 DEBT AND OTHER OBLIGATIONS. Borrower's obligations for the
payment of the Debt and the performance of the Other Obligations shall be
referred to collectively herein as the "OBLIGATIONS."
JPMORGAN CHASE BANK
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Section 2.4 PAYMENTS. Unless payments are made in the required amount
in immediately available funds at the place where the Note is payable,
remittances in payment of all or any part of the Debt shall not, regardless of
any receipt or credit issued therefor, constitute payment until the required
amount is actually received by Lender in funds immediately available at the
place where the Note is payable (or any other place as Lender, in Lender's sole
discretion, may have established by delivery of written notice thereof to
Borrower) and shall be made and accepted subject to the condition that any check
or draft may be handled for collection in accordance with the practice of the
collecting bank or banks. Acceptance by Lender of any payment in an amount less
than the amount then due shall be deemed an acceptance on account only, and the
failure to pay the entire amount then due shall be and continue to be an Event
of Default (as hereinafter defined ).
ARTICLE 3 - BORROWER COVENANTS
Borrower covenants and agrees that:
Section 3.1 INCORPORATION BY REFERENCE. All the covenants, conditions
and agreements contained in (a) the Note, and (b) all and any of the documents
other than the Note or this Security Instrument now or hereafter executed by
Borrower and/or others and by or in favor of Lender in connection with the
creation of the Obligations, the payment of any other sums owed by Borrower to
Lender or the performance of any Obligations (collectively the "OTHER LOAN
DOCUMENTS"), are hereby made a part of this Security Instrument to the same
extent and with the same force as if fully set forth herein. The term "LOAN
DOCUMENTS" as used herein shall individually and collectively refer to the Note,
this Security Instrument and the Other Loan Documents; provided, however, that
notwithstanding any provision of this Security Instrument to the contrary, the
Obligations of the Borrower under that certain Environmental Indemnity Agreement
of even date herewith executed by Borrower in favor of Lender (the
"ENVIRONMENTAL INDEMNITY") shall not be deemed or construed to be secured by
this Security Instrument or otherwise restricted or affected by the foreclosure
of the lien hereof or any other exercise by Lender of its remedies hereunder or
under any other Loan Document, such Environmental Indemnity being intended by
the signatories thereto to be its (or their) unsecured obligation.
Section 3.2 INSURANCE.
(a) Borrower shall obtain and maintain, and shall pay all
premiums in accordance with Subsection 3.2(b) below for, insurance for
Borrower and the Property providing at least the following coverages:
(i) comprehensive all risk insurance (including,
without limitation, riot and civil commotion, vandalism,
malicious mischief, water, fire, burglary and theft and
without any exclusion for terrorism) on the Improvements and
the Personal Property and in each case (A) in an amount equal
to 100% of the "Full Replacement Cost", which for purposes of
this Security Instrument shall mean actual replacement value
(exclusive of costs of excavations, foundations, underground
utilities and footings) with a waiver of depreciation; (B)
containing an agreed amount endorsement with respect to the
Improvements and Personal Property waiving all co-insurance
provisions; (C) providing that the deductible
JPMORGAN CHASE BANK
8
shall not exceed the lesser of $10,000.00 or one percent (1%)
of the face value of the policy; and (D) containing Demolition
Costs, Increased Cost of Construction and "Ordinance or Law
Coverage" or "Enforcement" endorsements in amounts
satisfactory to Lender if any of the Improvements or the use
of the Property shall at any time constitute legal
non-conforming structures or uses or the ability to rebuild
the Improvements is restricted or prohibited. The Full
Replacement Cost may be redetermined from time to time by an
appraiser or contractor designated and paid by Lender or by an
engineer or appraiser in the regular employ of the insurer.
No omission on the part of Lender to request any such
appraisals shall relieve Borrower of any of its obligations
under this Subsection. Borrower agrees that at all times prior
to January 1, 2004, Borrower shall obtain and maintain and
shall pay all premiums in accordance with Subsection 3.2(b)
below for either (x) comprehensive all-risk insurance without
any exclusion for terrorism or (y) a separate terrorism
insurance policy (either of which shall constitute "TERRORISM
COVERAGE"). Notwithstanding he preceding sentence, at all
times after December 31, 2003, Borrower shall obtain and
maintain and shall pay all premiums in accordance with
Subsection 3.2(b) below for Terrorism Coverage only if
Terrorism Coverage is available at commercially reasonable
rates.
(ii) comprehensive general liability insurance
against claims for personal injury, bodily injury, death or
property damage occurring upon, in or about the Property, such
insurance (A) to be on the so-called "occurrence" form with a
combined single limit of not less than $1,000,000.00 and not
less than $3,000,000.00 if the Property has one or more
elevators, as well as liquor liability insurance in a minimum
amount of $2,000,000.00 if any part of the Property is covered
by a liquor license and an aggregate coverage limit acceptable
to Lender; (B) to continue at not less than the aforesaid
limit until required to be changed by Lender in writing by
reason of changed economic conditions making such protection
inadequate; (C) to cover at least the following hazards: (1)
premises and operations; (2) products and completed operations
on an "if any" basis; (3) independent contractors; (4) blanket
contractual liability for all written and oral contracts; (5)
contractual liability covering the indemnities contained in
Article 11 hereof to the extent the same is available; and (D)
to be without deductible;
(iii) business income insurance (A) with loss payable
to Lender; (B) covering losses of income and Rents derived
from the Property and any non-insured property on or adjacent
to the Property resulting from any risk or casualty
whatsoever; (C) containing an extended period of indemnity
endorsement which provides that after the physical loss to
the Improvements and Personal Property has been repaired, the
continued loss of income will be insured until such income
either returns to the same level it was at prior to the loss,
or the expiration of eighteen (18) months from the date of the
loss, whichever first occurs, and notwithstanding that the
policy may expire prior to the end of such period; and (D) in
an amount equal to 100% of the projected gross income from the
Property for a period of eighteen (18) months. The amount of
such business income insurance shall be determined by Lender
prior to the date hereof and at least once each year
thereafter based on Borrower's reasonable estimate of the
gross income
JPMORGAN CHASE BANK
9
from the Property for the succeeding eighteen (18) month
period. All insurance proceeds payable to Lender pursuant to
this Subsection 3.2(a) shall be held by Lender and shall be
applied to the obligations secured hereunder from time to time
due and payable hereunder and under the Note; provided,
however, that nothing herein contained shall be deemed to
relieve Borrower of its obligations to pay the obligations
secured hereunder on the respective dates of payment provided
for in the Note except to the extent such amounts are actually
paid out of the proceeds of such business income insurance;
(iv) at all times during which structural
construction, repairs or alterations are being made with
respect to the Improvements: (A) owner's contingent or
protective liability insurance covering claims not covered by
or under the terms or provisions of the above mentioned
commercial general liability insurance policy; and (B) the
insurance provided for in Subsection 3.2(a)(i) written in a
so-called builder's risk completed value form (1) on a
non-reporting basis, (2) against all risks insured against
pursuant to Subsection 3.2(a)(i), (3) including permission to
occupy the Property, and (4) with an agreed amount endorsement
waiving co-insurance provisions;
(v) workers' compensation, subject to the statutory
limits of the state in which the Property is located, and
employer's liability insurance with a limit of at least
$1,000,000.00 per accident and per disease per employee, and
$1,000,000.00 for disease aggregate in respect of any work or
operations on or about the Property, or in connection with the
Property or its operation (if applicable);
(vi) comprehensive boiler and machinery insurance
(without exclusion for explosion), if applicable, in amounts
as shall be reasonably required by Lender and covering all
boilers or other pressure vessels, machinery and equipment
located at or about the Property (including, without
limitation, electrical equipment, sprinkler systems, heating
and air conditioning equipment, refrigeration equipment and
piping);
(vii) if any portion of the Improvements is currently
or at any time in the future located in a federally designated
"special flood hazard area", flood hazard insurance in an
amount equal to the Full Replacement Cost; and
(viii) such other insurance and in such amounts as
Lender from time to time may reasonably request against such
other insurable hazards which at the time are commonly insured
against for property similar to the Property located in or
around the region in which the Property is located, including,
without limitation, earthquake insurance (in the event the
Property is located in an area with a high degree of seismic
activity), sinkhole insurance, mine subsidence insurance and
environmental insurance.
(b) All insurance provided for in Subsection 3.2(a) hereof
shall be obtained under valid and enforceable policies (the "POLICIES"
or in the singular, the "POLICY"), in such
JPMORGAN CHASE BANK
10
forms and, from time to time after the date hereof, in such amounts as
may from time to time be satisfactory to Lender, issued by financially
sound and responsible insurance companies authorized to do business in
the state in which the Property is located as admitted or unadmitted
carriers which, in either case, have been approved by Lender and which
have a claims paying ability rating of A or better issued by Standard &
Poor's Ratings Group or with a claims paying ability rating otherwise
acceptable to Lender (each such insurer shall be referred to below as a
"QUALIFIED INSURER"). Such Policies shall not be subject to
invalidation due to the use or occupancy of the Property for purposes
more hazardous than the use of the Property at the time such Policies
were issued. Not less than thirty (30) days prior to the expiration
dates of the Policies theretofore furnished to Lender pursuant to
Subsection 3.2(a), certified copies of the Policies marked "premium
paid" or accompanied by evidence satisfactory to Lender of payment of
the premiums due thereunder (the "INSURANCE PREMIUMS"), shall be
delivered by Borrower to Lender; provided, however, that in the case of
renewal Policies, Borrower may furnish Lender with binders therefore to
be followed by the original Policies when issued.
(c) Borrower shall not obtain (i) separate insurance
concurrent in form or contributing in the event of loss with that
required in Subsection 3.2(a) to be furnished by, or which may be
reasonably required to be furnished by, Borrower, or (ii) any umbrella
or blanket liability or casualty Policy unless, in each case, Lender's
interest is included therein as provided in this Security Instrument
and such Policy is issued by a Qualified Insurer. If Borrower obtains
separate insurance or an umbrella or a blanket Policy, Borrower shall
notify Lender of the same and shall cause certified copies of each
Policy to be delivered as required in Subsection 3.2(a). Any blanket
insurance Policy shall specifically allocate to the Property the amount
of coverage from time to time required hereunder and shall otherwise
provide the same protection as would a separate Policy insuring only
the Property in compliance with the provisions of Subsection 3.2(a).
(d) All Policies of insurance provided for or contemplated by
Subsection 3.2(a) shall name Lender, its successors and assigns,
including any servicers, trustees or other designees of Lender, and
Borrower as the insured or additional insured, as their respective
interests may appear, and in the case of property damage, boiler and
machinery, and flood insurance, shall contain a so-called New York
standard non-contributing Lender clause in favor of Lender providing
that the loss thereunder shall be payable to Lender.
(e) All Policies of insurance provided for in Subsection
3.2(a) shall contain clauses or endorsements to the effect that:
(i) no act or negligence of Borrower, or anyone
acting for Borrower, or of any tenant under any Lease or other
occupant, or failure to comply with the provisions of any
Policy which might otherwise result in a forfeiture of the
insurance or any part thereof, shall in any way affect the
validity or enforceability of the insurance insofar as Lender
is concerned;
JPMORGAN CHASE BANK
11
(ii) the Policy shall not be materially changed
(other than to increase the coverage provided on the Property
thereby) or canceled without at least thirty (30) days' prior
written notice to Lender and any other party named therein as
an insured;
(iii) each Policy shall provide that the issuers
thereof shall give written notice to Lender if the Policy has
not been renewed thirty (30) days prior to its expiration; and
(iv) Lender shall not be liable for any Insurance
Premiums thereon or subject to any assessments thereunder.
(f) Borrower shall furnish to Lender within ten (10) calendar
days after Lender's request therefor, a statement certified by Borrower
or a duly authorized officer of Borrower of the amounts of insurance
maintained in compliance herewith, of the risks covered by such
insurance and of the insurance company or companies which carry such
insurance and, if requested by Lender, verification of the adequacy of
such insurance by an independent insurance broker or appraiser
acceptable to Lender.
(g) If at any time Lender is not in receipt of written
evidence that all insurance required hereunder is in full force and
effect, Lender shall have the right but not the obligation, without
notice to Borrower, to take such action as Lender deems necessary to
protect its interest in the Property, including, without limitation,
the obtaining of such insurance coverage as Lender in its sole
discretion deems appropriate, and all expenses incurred by Lender in
connection with such action or in obtaining such insurance and keeping
it in effect shall be paid by Borrower to Lender upon demand and until
paid shall be secured by this Security Instrument and shall bear
interest at the Default Rate (as hereinafter defined).
(h) If the Property shall be damaged or destroyed, in whole or
in part, by fire or other casualty, Borrower shall give prompt notice
thereof to Lender.
(i) In case of loss covered by Policies, Lender may
either (1) settle and adjust any claim without the consent of
Borrower, or (2) allow Borrower to agree with the insurance
company or companies on the amount to be paid upon the loss;
provided, that Borrower may adjust losses aggregating not in
excess of $100,000.00 if such adjustment is carried out in a
competent and timely manner, and provided that in any case
Lender shall and is hereby authorized to collect and receive
any such insurance proceeds; and the expenses incurred by
Lender in the adjustment and collection of insurance proceeds
shall become part of the Debt and be secured hereby and shall
be reimbursed by Borrower to Lender upon demand (unless
deducted by and reimbursed to Lender from such proceeds).
(ii) In the event of any insured damage to or
destruction of the Property or any part thereof (herein called
an "INSURED CASUALTY"), if (A) less than 65% of the total
floor area of the Improvements has been damaged, destroyed or
rendered unusable as a result of such Insured Casualty and in
the
JPMORGAN CHASE BANK
12
reasonable judgment of Lender, the Property can be restored within
nine(9) months after insurance proceeds are made available to an
economic unit not less valuable (including an assessment by Lender of
the impact of the termination of any Leases due to such Insured
Casualty) and not less useful than the same was prior to the Insured
Casualty, and after such restoration will adequately secure the
outstanding balance of the Debt, and (B) no Event of Default
(hereinafter defined) shall have occurred and be then continuing, then
the proceeds of insurance shall be applied to reimburse Borrower for
the cost of restoring, repairing, replacing or rebuilding the Property
or part thereof subject to Insured Casualty, as provided, below; and
Borrower hereby covenants and agrees forthwith to commence and
diligently, to prosecute such restoring, repairing, replacing or
rebuilding; provided however, in any event Borrower shall pay all costs
(and if required by Lender, Borrower shall deposit the total thereof
with Lender in advance ) of such restoring, repairing, replacing or
rebuilding in excess of the net proceeds of insurance made available
pursuant to the terms hereof.
(iii) Expect as provided above, the proceeds of insurance
collected upon any Insured Casualty shall, at the option of Lender in
its sole discretion, be applied to the payment of the Debt or applied
to reimburse Borrower for the cost of restoring, repairing, replacing
or rebuilding the Property or part thereof subject to the Insured
Casualty, in the manner set forth below. Any such application to the
Debt shall NOT be considered a voluntary prepayment requiring payment
of the prepayment consideration provided in the Note, and shall not
reduce or postpone any payments otherwise required pursuant to the
Note, other than the final payment on the Note.
(iv) If proceeds of insurance, if any, are made available
to Borrower for the restoring, repairing, replacing or rebuilding of
the Property, Borrower hereby covenants to restore, repair, replace or
rebuild the same to be of at least equal value and of substantially the
same character as prior to such damage or destruction, all to be
effected in accordance with applicable law and plans and specification
approved in advance by Lender.
(v) If Borrower is entitled to reimbursement out of
insurance proceeds held by Lender, such proceeds shall be disbursed
from time to time upon Lender being furnished with (1) evidence
satisfactory to it (which evidence may include inspection[s] of the
work performed) that the restoration, repair, replacement and
rebuilding covered by the disbursement has been completed in accordance
with plans and specifications approved by Lender, (2) evidence
satisfactory to it of the estimated cost of completion of the
restoration, repair, replacement and rebuilding, (3) funds, or at
Lender's option, assurances satisfactory to Lender that such funds are
available, sufficient in addition to the proceeds of insurance to
complete the proposed restoration, repair, replacement and rebuilding,
and (4) such architect's certificates, waivers of lien, contractor's
sworn statements, title insurance endorsements bonds, plats of survey
and such other evidences of cost, payment and performance as Lender may
reasonably require and approve; and Lender may, in ant event, require
that all plans and specifications for such
JPMORGAN CHASE BANK
13
restoration, repair, replacement and rebuilding be submitted to and
approved by Lender prior to commencement of work. With respect to
disbursements to be made by Lender: (A) no payment made prior to the
final completion of the restoration, repair, replacement and rebuilding
shall exceed ninety percent(90%) of the value of the work performed
from time to time; (B) funds other than proceeds of insurance shall be
disbursed prior to disbursement of such proceeds; and (C) at all times,
the undisbursed balance of such proceeds remaining in the hands of
Lender, together with funds deposited for that purpose or irrevocably
committed to the satisfaction of Lender by or on behalf of Borrower for
that purpose, shall be at least sufficient in the reasonable judgment
of Lender to pay for the cost of completion of the restoration, repair,
replacement and rebuilding, free and clear of all liens or claims for
lien and the costs described in Subsection 3.2(h)(vi) below. Any
surplus which may remain out of insurance proceeds held by Lender after
payment of such costs of restoration, repair, replacement and
rebuilding shall be paid to any party entitled thereto. In no event
shall Lender assume any duty or obligation for the adequacy, form or
content of any such plans and specifications, nor for the performance,
quality or workmanship of any restoration, repair, replacement and
rebuilding.
(vi) Notwithstanding anything to the contrary contained
herein, the proceeds of insurance reimbursed to Borrower in accordance
with the terms and provisions of this Security Instrument shall be
reduced by the reasonable costs (if any) incurred by Lender in the
adjustment and collection thereof and in the reasonable costs incurred
by Lender of paying out such proceeds (including, without limitation,
reasonable attorney's fees and costs paid to third parties for
inspecting the restoration, repair, replacement and rebuilding and
reviewing the plans and specifications therefor).
Section 3.3 PAYMENT OF TAXES, ETC.
(a) Subject to Article 3 of the Escrow Agreement, Borrower shall pay
all taxes, assessments, water rates, sewer rents, governmental impositions, and
other charges, including without limitation, vault charges and license fees for
the use of vaults, chutes and similar areas adjoining the Land, now or hereafter
levied or assessed or imposed against the Property or any part thereof (the
"TAXES"), all ground rents, maintenance charges and similar charges, now or
hereafter levied or assessed or imposed against the Property or any part thereof
(the "OTHER CHARGES"), and all charges for utility services provided to the
Property prior to delinquency. Borrower will deliver to Lender, promptly upon
Lender's request, evidence satisfactory to Lender that the Taxes, Other Charges
and utility service charges have been so paid or are not then delinquent.
Borrower shall not allow and shall promptly cause to be paid and discharged any
lien or charge whatsoever which may be or become a lien or charge against the
Property. Except to the extent sums sufficient to pay all Taxes and Other
Charges have been deposited with Lender in accordance with the terms of this
Security Instrument, Borrower shall furnish to Lender paid receipts for the
payment of the Taxes and Other Charges prior to the date the same shall become
delinquent.
JPMORGAN CHASE BANK
14
(b) After prior written notice to Lender, Borrower, at its own expense,
may contest by appropriate legal proceeding, promptly initiated and conducted in
good faith and with due diligence, the amount or validity or application in
whole or in part of any of the Taxes, provided that (i) no Event of Default has
occurred and is continuing under the Note, this Security Instrument or any of
the Other Loan Documents, (ii) Borrower is permitted to do so under the
provisions of any other mortgage, deed of trust or deed to secure debt affecting
the Property, (iii) such proceeding shall suspend the collection of the Taxes
from Borrower and from the Property or Borrower shall have paid all of the Taxes
under protest, (iv) such proceeding shall be permitted under and be conducted in
accordance with the provisions of any other instrument to which Borrower is
subject and shall not constitute a default thereunder, (v) neither the Property
nor any part thereof or interest therein will be in danger of being sold,
forfeited, terminated, canceled or lost, (vi) Borrower shall have set aside and
deposited with Lender adequate reserves for the payment of the Taxes, together
with all interest and penalties thereon, unless Borrower has paid all of the
Taxes under protest, and (vii) Borrower shall have furnished the security as may
be required in the proceeding, or as may be requested by Lender to insure the
payment of any contested Taxes, together with all interest and penalties
thereon.
Section 3.4 CONDEMNATION. Borrower shall promptly give Lender notice of
the actual or threatened commencement of any condemnation or eminent domain
proceeding and shall deliver to Lender copies of any and all papers served in
connection with such proceedings. Lender is hereby irrevocably appointed as
Borrower's attorney-in-fact, coupled with an interest, with exclusive power to
collect, receive and retain any award or payment for said condemnation or
eminent domain and to make any compromise or settlement in connection with such
proceeding, subject to the provisions of this Security Instrument.
Notwithstanding any taking by any public or quasi-public authority through
eminent domain or otherwise (including but not limited to any transfer made in
lieu of or in anticipation of the exercise of such taking), Borrower shall
continue to pay the Debt at the time and in the manner provided for its payment
in the Note and in this Security Instrument and the Debt shall not be reduced
until any award or payment therefor shall have been actually received and
applied by Lender, after the deduction of expenses of collection, to the
reduction or discharge of the Debt. Lender shall not be limited to the interest
paid on the award by the condemning authority but shall be entitled to receive
out of the award interest at the rate or rates provided herein or in the Note.
Borrower shall cause the award or payment made in any condemnation or eminent
domain proceeding, which is payable to Borrower, to be paid directly to Lender.
Lender may apply any award or payment to the reduction or discharge of the Debt
whether or not then due and payable (such application to be free from any
prepayment consideration provided in the Note, except that if an Event of
Default, or an event which with notice and/or the passage of time, or both,
would constitute an Event of Default, has occurred, then such application shall
be subject to the full prepayment consideration computed in accordance with the
Note). If the Property is sold, through foreclosure or otherwise, prior to the
receipt by Lender of the award or payment, Lender shall have the right, whether
or not a deficiency judgment on the Note shall have been sought, recovered or
denied, to receive the award or payment, or a portion thereof sufficient to pay
the Debt.
Section 3.5 USE AND MAINTENANCE OF PROPERTY. Borrower shall cause the
Property to be maintained and operated in a good and safe condition and repair
and in keeping with the condition and repair of properties of a similar use,
value, age, nature and construction.
JPMORGAN CHASE BANK
15
Borrower shall not use, maintain or operate the Property in any manner which
constitute a public or private nuisance or which makes void, voidable, or
cancelable, or increases the premium of, any insurance then in force with
respect thereto. The Improvements and the Personal property shall not be
removed, demolished or materially altered(except for normal replacement of the
Personal Property with items of the same utility and of equal or greater value
unless obsolete and non-structural alterations in connection with tenant
improvements under leases approved by Lender or for which Lender's approval is
not required under this Security Instrument) without the prior written consent
of Lender. Borrower shall promptly repair, replace or rebuild any part of the
Property which may destroyed by any casualty, or become damaged, worn or
dilapidated or which may be affected by any proceeding of the character referred
to in Section 3.4 hereof and shall complete and pay for any structure at any
time in the process of Construction or repair on the Land. Borrower shall not
initiate, Join in, acquiesce in, or consent to any change in any private
restrictive covenant, zoning law or other public or private restriction,
limiting or defining the uses which may be made of Property or any part thereof
absent Lender's prior written consent. If under applicable zoning provision the
use of all or any portion of the property is or shall become a nonconforming
use, Borrower will not cause or permit the nonconforming use to be discontinued
or abandoned without the express written consent of Lender. Borrower shall not
take any steps whatsoever to convert the Property, or any portion thereof, to a
condominium or cooperative form of management.
Section 3.6 WASTE. Borrower shall not commit or suffer any waste of the
Property or, without first obtaining such additional insurance as may be
necessary to cover a proposed change in use of the Property, make any change in
the use of the Property which will in any way materially increase the risk of
fire or other hazard arising out of the operation of the property, or take any
action that might invalidate or give cause for cancellation of any Policy, or do
or permit to be done thereon anything that may in any way impair the value of
the Property or the security of this Security Instrument. Borrower will not,
without the prior written consent of Lender, permit any drilling or exploration
for or extraction, removal, or production of any minerals from the surface or
the subsurface of the Land, regardless of the depth thereof or the method of
mining or extraction thereof.
Section 3.7 COMPLIANCE WITH LAWS; ALTERATIONS.
(a) Borrower shall promptly comply with all existing and
future federal, state and local laws, orders, ordinances, governmental
rules and regulations or court orders affecting or which may be
interpreted to affect the Property, or the use thereof, including, but
not limited to, the Americans with Disabilities Act (the "ADA")
(collectively "APPLICABLE LAWS").
(b) Notwithstanding any provisions set forth herein or in any
document regarding Lender's approval of alterations of the Property,
Borrower shall not alter the Property in any manner which would
increase Borrower's responsibilities for compliance with Applicable
laws without the prior written approval of Lender. Lender's approval of
the plans specifications, or working drawings for alterations of the
Property shall create no responsibility or liability on behalf of
Lender for their completeness, design, sufficiency or their compliance
with Applicable Laws. The foregoing shall apply to tenant improvements
constructed by Borrower or by any of its tenants. Lender may condition
JPMORGAN CHASE BANK
16
any such approval upon receipt of a certificate of compliance with Applicable
Laws from an independent architect, engineer, or other person acceptable to
Lender.
(c) Borrower shall give prompt notice to Lender of the receipt by
Borrower of any notice related to a violation of any Applicable Laws and of the
commencement of any proceedings or investigations which relate to compliance
with Applicable Laws.
(d) Borrower shall take appropriate measures to prevent and will not
engage in or knowingly permit any illegal activities at the Property.
Section 3.8 BOOKS AND RECORDS.
(a) Borrower shall keep accurate books and records of account in
accordance with sound accounting principles in which full, true and correct
entries shall be promptly made with respect to Borrower, the Property and the
operation thereof, and will permit all such books and records (including without
limitation all contracts, statements, invoices, bills and claims for labor,
materials and services supplied for the construction, repair or operation to
Borrower of the Improvements) to be inspected or audited and copies made by
Lender and its representatives during normal business hours and at any other
reasonable times upon reasonable advance written notice except in emergencies.
Borrower represents that its chief executive office is as set forth in the
introductory paragraph of this Security Instrument and that all books and
records pertaining to the Property are maintained at the Property or such other
location as may be expressly disclosed to Lender in writing. Borrower will
furnish, or cause to be furnished, to Lender on or before fifty-five (55)
calendar days after the end of each calendar quarter the following items, each
certified by Borrower as being true and correct, in such format and in such
detail as Lender or its servicer may request:
(i) a written statement (rent roll) dated as of the last
day of each such calendar quarter identifying each of the Leases by the
term, space occupied, rental required to be paid (including percentage
rents and tenant sales), security deposit paid, any rental concessions,
all rent escalations, and rents paid more than one (1) month in
advance, any special provisions or inducements granted to tenants, any
taxes, maintenance and other common charges paid by tenants, all
vacancies and identifying any defaults or payment delinquencies
thereunder; and
(ii) quarterly and year-to-date operating statements
prepared for each calendar quarter during each such reporting period
detailing the total revenues received, total expenses incurred, total
cost of all capital improvements, total debt service and total cash
flow.
(b) Within ninety (90) calendar days following the end of each calendar
year, Borrower shall furnish a statement of the financial affairs and condition
of the Borrower and the Property including a statement of profit and loss for
the Property in such format and in such detail as Lender or its servicer may
request, and setting forth the financial condition and the income and expenses
for the Property for the immediately preceding calendar year prepared by an
independent certified public accountant. Borrower shall
JPMORGAN CHASE BANK
17
deliver to Lender copies of all income tax returns, requests for
extension and other similar items contemporaneously with its delivery
of same to the Internal Revenue Service.
(c) Borrower will permit representatives appointed by Lender,
including independent accountants, agents, attorneys, appraisers and
any other persons, upon reasonable advance notice except in
emergencies, subject to the rights of tenants, to visit and inspect
during its normal business hours and at any other reasonable times any
of the Property and to make photographs thereof, and to write down and
record any information such representatives obtain, and shall permit
Lender or its representatives to investigate and verify the accuracy of
the information furnished to Lender under or in connection with this
Security Instrument or any of the Other Loan Documents and to discuss
all such matters with its officers, employees and representatives.
Borrower will furnish to Lender at Borrower's expense all evidence
which Lender may from time to time reasonably request as to the
accuracy and validity of or compliance with all representations and
warranties made by Borrower in the Loan Documents and satisfaction of
all conditions contained therein. Any inspection or audit of the
Property or the books and records of Borrower, or the procuring of
documents and financial and other information, by or on behalf of
Lender, shall be at Borrower's expense and shall be for Lender's
protection only, and shall not constitute any assumption of
responsibility or liability by Lender to Borrower or anyone else with
regard to the condition, construction, maintenance or operation of the
Property, nor Lender's approval of any certification given to Lender
nor relieve Borrower of any of Borrower's obligations.
(d) Prior to the transfer of the Loan by Lender pursuant to
Section 16.1 hereof, Borrower shall deliver to Lender the reports
required by Section 3.8(a) on a monthly basis. Such reports shall be
delivered within twenty-five (25) calendar days after the end of each
calendar month.
Section 3.9 PAYMENT FOR LABOR AND MATERIALS. Borrower will promptly pay
when due all bills and costs incurred by Borrower for labor, materials, and
specifically fabricated materials incurred in connection with the Property and
never permit to exist beyond the due date thereof in respect of the Property or
any part thereof any lien or security interest, even though inferior to the
liens and the security interests hereof, and in any event never permit to be
created or exist in respect of the Property or any part thereof any other or
additional lien or security interest other than the liens or security interests
hereof, except for the Permitted Exceptions (as hereinafter defined).
Section 3.10 PERFORMANCE OF OTHER AGREEMENTS. Borrower shall observe
and perform each and every term to be observed or performed by Borrower pursuant
to the terms of any agreement or recorded instrument affecting or pertaining to
the Property, or given by Borrower to Lender for the purpose of further securing
an obligation secured hereby and any amendments, modifications or changes
thereto.
ARTICLE 4 - SPECIAL COVENANTS
Borrower covenants and agrees that:
JPMORGAN CHASE BANK
18
Section 4.1 PROPERTY USE. The Property shall be used only for
industrial, warehouse and office purposes, and for no other use without the
prior written consent of Lender, which consent may be withheld in Lender's sole
and absolute discretion.
Section 4.2 ERISA.
(a) It shall not engage in any transaction which would cause
any obligation, or action taken or to be taken, hereunder (or the
exercise by Lender of any of its rights under the Note, this Security
Instrument and the Other Loan Documents) to be a non-exempt (under a
statutory or administrative class exemption) prohibited transaction
under the Employee Retirement Income Security Act of 1974, as
amended ("ERISA").
(b) It shall deliver to Lender such certifications or other
evidence from time to time throughout the term of the Security
Instrument, as requested by Lender in its sole discretion, that (i)
Borrower is not an "employee benefit plan" as defined in Section 3(3)
of ERISA, which is subject to Title I of ERISA, or a "governmental
plan" within the meaning of Section 3(32) of ERISA; (ii) Borrower is
not subject to state statutes regulating investments and fiduciary
obligations with respect to governmental plans; and (iii) one or more
of the following circumstances is true:
(i) Equity interests in Borrower are publicly
offered securities, within the meaning of 29 C.F.R. Section
2510.3-101(b)(2);
(ii) Less than twenty-five percent (25%) of each
outstanding class of equity interests in Borrower are held by
"benefit plan investors" within the meaning of 29 C.F.R.
Section 2510.3-101(f)(2);or
(iii) Borrower qualifies as an "operating company"
or a "real estate operating company" within the meaning of 29
C.F.R. Section 2510.3-101(c) or (e) or an investment company
registered under The Investment Company Act of 1940.
Section 4.3 SINGLE PURPOSE ENTITY. Borrower covenants and agrees that
it has not and shall not:
(a) engage in any business or activity other than the
acquisition, ownership, operation and maintenance of the Property, and
activities incidental thereto;
(b) acquire or own any material asset other then (i) the
Property, and (ii) such incidental Personal Property as may be
necessary for the operation of the Property;
(c) merge into or consolidate with any person or entity or
dissolve, terminate or liquidate in whole or in part, transfer or
otherwise dispose of all or substantially all of its assets or change
its legal structure, without in each case Lender's consent;
(d) fail to preserve its existence as an entity duly
organized, validly existing and in good standing (if applicable) under
the laws of the jurisdiction of its organization or formation, or
without the prior written consent of Lender, amend, modify, terminate
or fail to comply with the provisions of Borrower's Partnership
Agreement, Articles or
JPMORGAN CHASE BANK
19
Certificate of Incorporation, Articles of Organization, Operating
Agreement or similar organizational documents, as the case may be;
(e) own any subsidiary or make any investment in or acquire
the obligations or securities of any other person or entity without the
consent of Lender;
(f) commingle its assets with the assets of any of its
partner(s), members, shareholders, affiliates, or of any other person
or entity or transfer any assets to any such person or entity other
than distributions on account of equity interests in the Borrower
permitted hereunder and properly accounted for;
(g) incur any debt, secured or unsecured, direct or contingent
(including guaranteeing any obligation), other than the Debt, except
unsecured trade and operational debt incurred with trade creditors in
the ordinary course of its business of owning and operating the
Property in such amounts as are normal and reasonable under the
circumstances, provided that such debt is not evidenced by a note and
is paid when due and provided in any event the outstanding principal
balance of such debt shall not exceed at any one time one percent (1%)
of the outstanding Debt;
(h) allow any person or entity to pay its debts and
liabilities (except a Guarantor or Indemnitor) or fail to pay its debts
and liabilities solely from its own assets;
(i) fail to maintain its records, books of account and bank
accounts separate and apart from those of the shareholders, partners,
members, principals and affiliates of Borrower, the affiliates of a
shareholder, partner or member of Borrower, and any other person or
entity or fail to prepare and maintain its own financial statements in
accordance with generally accepted accounting principles and
susceptible to audit, or if such financial statements are consolidated
fail to cause such financial statements to contain footnotes
disclosing that the Property is actually owned by the Borrower;
(j) enter into any contract or agreement with any shareholder,
partner, member, principal or affiliate of Borrower, any guarantor of
all or a portion of the Debt (a "GUARANTOR") or any shareholder,
partner, member, principal or affiliate thereof, except upon terms and
conditions that are intrinsically fair and substantially similar to
those that would be available on an arms-length basis with third
parties other than any shareholder, partner, member, principal or
affiliate of Borrower or Guarantor, or any shareholder, partner,
member, principal or affiliate thereof;
(k) seek dissolution or winding up in whole, or in part;
(l) fail to correct any known misunderstandings regarding the
separate identity of Borrower;
(m) hold itself out to be responsible or pledge its assets or
credit worthiness for the debts of another person or entity or allow
any person or entity to hold itself out to be responsible or pledge its
assets or credit worthiness for the debts of the Borrower (except for a
Guarantor or Indemnitor);
JPMORGAN CHASE BANK
20
(n) make any loans or advances to any third party, including
any shareholder, partner, member, principal or affiliate of Borrower,
or any shareholder, partner, member, principal or affiliate thereof;
(o) fail to file its own tax returns (except to the extent
consolidated with another entity pursuant to generally accepted
accounting principles or applicable law) or to use separate contracts,
purchase orders, stationary, invoices and checks;
(p) fail either to hold itself out to the public as a legal
entity separate and distinct from any other entity or person or to
conduct its business solely in its own name in order not (i) to mislead
others as to the entity with which such other party is transacting
business, or (ii) to suggest that Borrower is responsible for the debts
of any third party (including any shareholder, partner, member,
principal or affiliate of Borrower, or any shareholder, partner,
member, principal or affiliate thereof);
(q) fail to allocate fairly and reasonably among Borrower and
any third party (including, without limitation, any Guarantor) any
overhead for common employees, shared office space or other overhead
and administrative expenses;
(r) allow any person or entity to pay the salaries of its own
employees or fail to maintain a sufficient number of employees for its
contemplated business operations;
(s) fail to maintain adequate capital for the normal
obligations reasonably foreseeable in a business of its size and
character and in light of its contemplated business operations;
(t) file a voluntary petition or otherwise initiate
proceedings to have the Borrower or any general partner or managing
member adjudicated bankrupt or insolvent, or consent to the institution
of bankruptcy or insolvency proceedings against the Borrower or any
general partner or managing member, or file a petition seeking or
consenting to reorganization or relief of the Borrower or any general
partner or managing member as debtor under any applicable federal or
state law relating to bankruptcy, insolvency, or other relief for
debtors with respect to the Borrower or any general partner or managing
member; or seek or consent to the appointment of any trustee, receiver,
conservator, assignee, sequestrator, custodian, liquidator (or other
similar official) of the Borrower or any general partner or managing
member or of all or any substantial part of the properties and assets
of the Borrower or any general partner or managing member, or make any
general assignment for the benefit of creditors of the Borrower or any
general partner or managing member, or admit in writing the inability
of the Borrower or any general partner or managing member to pay its
debts generally as they become due or declare or effect a moratorium on
the Borrower or any general partner or managing member debt or take any
action in furtherance of any such action;
(u) share any common logo with or hold itself out as or be
considered as a department or division of (i) any shareholder, partner,
principal, member or affiliate of Borrower, (ii) any affiliate of a
shareholder, partner, principal, member or affiliate of
JPMORGAN CHASE BANK
21
Borrower, or (iii) any other person or entity or allow any person or
entity to identify the Borrower as a department or division of that
person or entity; or
(v) conceal assets from any creditor, or enter into any
transaction with the intent to hinder, delay or defraud creditors of
the Borrower or the creditors of any other person or entity.
ARTICLE 5 - REPRESENTATIONS AND WARRANTIES
Section 5.1 BORROWER'S REPRESENTATIONS. Borrower represents and
warrants to Lender that each of the representations and warranties set forth in
that certain Closing Certificate of even date herewith executed by Borrower in
favor of Lender are true and correct as of the date hereof and are hereby
incorporated and restated in this Security Instrument by this reference.
Section 5.2 WARRANTY OF TITLE. Borrower represents and warrants that it
has good and marketable title to the Property and has the right to grant,
bargain, sell, pledge, assign, warrant, transfer and convey the same and that
Borrower possesses an unencumbered fee simple absolute estate in the Land and
the Improvements and that it owns the Property free and clear of all liens,
encumbrances and charges whatsoever except for those exceptions shown in the
title insurance policy insuring the lien of this Security Instrument (the
"PERMITTED EXCEPTIONS"). Borrower shall, at its sole cost and expense, forever
warrant, defend and preserve the title and the validity and priority of the lien
of this Security Instrument and shall, at its sole cost and expense, forever
warrant and defend the same to Trustee and Lender against the claims of all
persons whomsoever.
Section 5.3 STATUS OF PROPERTY.
(a) No portion of the Improvements is located in an area
identified by the Secretary of Housing and Urban Development or any
successor thereto as an area having special flood hazards pursuant to
the National Flood Insurance Act of 1968 or the Flood Disaster
Protection Act of 1973, as amended or any successor law, or, if located
within any such area, Borrower has obtained and will maintain the
insurance prescribed in Section 3.2 hereof.
(b) Borrower has obtained all necessary certificates, permits,
licenses and other approvals, governmental and otherwise, necessary for
the use, occupancy and operation of the Property and the conduct of its
business (including, without limitation, certificates of completion and
certificates of occupancy) and all required zoning, building code, land
use, environmental and other similar permits or approvals, all of which
are in full force and effect as of the date hereof and not subject to
revocation, suspension, forfeiture or modification.
(c) The Property and the present and contemplated use and
occupancy thereof are to the best knowledge of Borrower in full
compliance with all Applicable Laws, including, without limitation,
zoning ordinances, building codes, land use and environmental laws,
laws relating to the disabled (including, but not limited to, the ADA)
and other similar laws.
JPMORGAN CHASE BANK
22
Section 6.2 NO RELIANCE ON LENDER. The partners, members, principals
and (if Borrower is a trust) beneficial owners of Borrower are experienced in
the ownership and operation of properties similar to the Property, and Borrower
and Lender are relying solely upon such expertise and business plan in
connection with the ownership and operation of the Property. Borrower is not
relying on Lender's expertise, business acumen or advice in connection with the
property.
Section 6.3 NO LENDER OBLIGATIONS.
(a) Notwithstanding the provisions of Subsections 1.1(e) and
1.1(1) or Section 1.2, Lender is not undertaking (i) any obligations
under the Leases; or (ii) any obligations with respect to such
agreements, contracts, certificates, instruments, franchises, permits,
trademarks, licenses and other documents.
(b) By accepting or approving anything required to be
observed, performed or fulfilled or to be given to Lender pursuant to
this Security Instrument, the Note or the Other Loan Documents,
including without limitation, any officer's certificate, balance sheet,
statement of profit and loss or other financial statement, survey,
appraisal, or insurance policy, Lender shall not be deemed to have
warranted, consented to, or affirmed the sufficiency, legality or
effectiveness of same, and such acceptance or approval thereof shall
not constitute any warranty or affirmation with respect thereto by
Lender.
Section 6.4 RELIANCE. Borrower recognizes and acknowledges that in
accepting the Note, this Security Instrument and the Other Loan Documents,
Lender is expressly and primarily relying on the truth and accuracy of the
warranties and representations set forth in Article 5 and that certain Closing
Certificate of even date herewith executed by Borrower, without any obligation
to investigate the Property and notwithstanding any investigation of the
Property by Lender; that such reliance existed on the part of Lender prior to
the date hereof; that such warranties and representations are a material
inducement to Lender in accepting the Note, this Security Instrument and the
Other Loan Documents; and that Lender would not be willing to make the Loan (as
hereinafter defined) and accept this Security Instrument in the absence of the
warranties and representations as set forth in Article 5 and such Closing
Certificate.
ARTICLE 7 - FURTHER ASSURANCES
Section 7.1 RECORDING FEES. Borrower will pay all taxes, filing,
registration or recording fees, and all expenses incident to the preparation,
execution, acknowledgment and/or recording of the Note, this Security
Instrument, the Other Loan Documents, any note or deed of trust supplemental
hereto, any security instrument with respect to the Property and any instrument
of further assurance, and any modification or amendment of the foregoing
documents, and all federal, state, county and municipal taxes, duties, imposts,
assessments and charges arising out of or in connection with the execution and
delivery of this Security Instrument, any deed of trust supplemental hereto, any
security instrument with respect to the Property or any instrument of further
assurance, and any modification or amendment of the foregoing documents, except
where prohibited by law so to do.
JPMORGAN CHASE BANK
24
Section 7.2 FURTHER ACTS. Borrower will, at the cost of Borrower, and
without expense to Lender, do, execute, acknowledge and deliver all and every
such further acts, deeds, conveyances, deeds of trust, assignments, notices of
assignments, transfers and assurances as lender shall, from time to time,
require, for the better assuring, conveying, assigning, transferring, and
confirming unto Lender the property and rights hereby granted, bargained, sold,
conveyed, confirmed, pledged, assigned, warranted and transferred or intended
now or hereafter so to be, or which Borrower may be or may hereafter become
bound to convey or assign to Lender, or for carrying out the intention or
facilitating the performance of the terms of this Security Instrument or for
filing, registering or recording this Security Instrument, or for complying with
all Applicable Laws. Borrower, on demand, will execute and deliver and hereby
authorizes Lender to execute in the name of Borrower or without the signature of
Borrower to the extent Lender may lawfully do so, one or more financing
statements, chattel mortgages or other instruments, to evidence more effectively
the security interest of Lender in the Property, Borrower grants to Lender an
irrevocable power of attorney coupled with an interest for the purpose of
exercising and perfecting any and all rights and remedies available to Lender at
law and in equity, including without limitation such rights and remedies
available to Lender pursuant to this Section 7.2.
Section 7.3 CHANGES IN TAX, DEBT CREDIT AND DOCUMENTARY STAMP LAWS.
(a) If any law is enacted or adopted or amended after the date
of this Security Instrument which imposes a tax, either directly or
indirectly, on the Debt or Lender's interest in the Property, requires
revenue or other stamps to be affixed to the Note, this Security
Instrument, or the Other Loan Documents, or imposes any other tax or
charge on the same, Borrower will pay the same, with interest and
penalties thereon, if any. If Lender is advised by counsel chosen by it
that the payment of tax by Borrower would be unlawful or taxable to
Lender or unenforceable or provide the basis for a defense of usury,
then Lender shall have the option, by written notice of not less than
ninety (90) calendar days, to declare the Debt immediately due and
payable.
(b) Borrower will not claim or demand or be entitled to any
credit or credits on account of the Debt for any part of the Taxes or
Other Charges assessed against the Property, or any part thereof, and
no deduction shall otherwise be made or claimed from the assessed value
of the Property, or any Part thereof, for real estate tax purposes by
reason of this Security Instrument or the Debt. If such claim, credit
or deduction shall be required by law, Lender shall have the option, by
written notice of not less than ninety (90) calendar days, to declare
the Debt immediately due and payable.
Section 7.4 CONFIRMATION STATEMENT
(a) After request by Lender, Borrower, within ten (10) days,
shall furnish Lender or any proposed assignee with a statement, duly
acknowledged and certified, confirming to Lender (or its designee) (i)
the amount of the original principal amount of the Note, (ii) the
unpaid principal amount of the Note, (iii) the rate of interest of the
Note, (iv) the terms of payment and maturity date of the Note, (v) the
date installments of interest and/or principal were last paid, and (vi)
that, except as provided in such statement, there
JPMORGAN CHASE BANK
25
are no defaults or events which with the passage of time or the giving
of notice or both, would constitute an event of default under the Note
or this Security Instrument; provided, however, Lender shall not be
entitled Hereunder to receive more than one (1) such statement in each
calendar year.
(b) Subject to the provisions of the Leases, Borrower shall
deliver to Lender, promptly upon request (but not more frequently than
once annually so long as Borrower is not in default hereunder), duly
executed estoppel certificates from any one or more lesses as required
by lender attesting to such facts regarding the Lease as Lender may
require, including but not limited to attestations that each lease
covered thereby is in full force and effect with no defaults thereunder
on the part of any party, that none of the rents have been paid more
than one month in advance, and that the lessee claims no defense or
offset against the full and timely performance of its obligations under
the Lease.
(c) Upon any transfer or proposed transfer contemplated by
Section 16.1 hereof, at Lender's request, Borrower, any Guarantors and
any Indemnitors shall provide an estoppel certificate to the Investor
(defined in Section 16.1) or any prospective Investor in such form,
substance and detail as Lender, such Investor or prospective Investor
may reasonably require.
Section 7.5 SPLITTING OF SECURITY INSTRUMENT. This Security Instrument
and the Note shall, at any time until the same shall be fully paid and
satisfied, at the sole election of Lender, be split or divided into two or more
notes and two or more security instruments, each of which shall cover all or a
portion of the Property to be more particularly described therein. To that end,
Borrower, upon written request of Lender, shall execute, acknowledge and
deliver, or cause to be executed, acknowledged and delivered by the then owner
of the Property, to Lender and/or its designee or designees substitute notes and
security instruments in such principal amounts, aggregating not more than the
then unpaid principal amount of Debt, and containing terms, provisions and
clauses similar to those contained herein and in the Note, and such other
documents and instruments as may be required by Lender.
Section 7.6 REPLACEMENT DOCUMENTS. Upon receipt of an affidavit of an
officer of lender as to the loss, theft, destruction or mutilation of the Note
or any Other Loan Document which is not of public record, and, in the case of
any such mutilation, upon surrender and cancellation of such Note or other Loan
Document, Borrower, at its expense, will issue, in lieu thereof, a replacement
Note or Other Loan Document, dated the date of such lost, stolen, destroyed or
mutilated Note or Other Loan Document in the same principal amount thereof and
otherwise of like tenor.
ARTICLE 8 - DUE ON SALE/ENCUMBRANCE
Section 8.1 LENDER RELIANCE. Borrower acknowledges that Lender has
examined and relied on the creditworthiness of Borrower and experience of
Borrower and its partners, members, principals and (if Borrower is a trust)
beneficial owners in owning and operating properties such as the Property in
agreeing to make the Loan, and will continue to rely on Borrower's ownership of
the Property as a means of maintaining the value of the Property as
JPMORGAN CHASE BANK
26
Security for repayment of the Debt and the performance of the Other Obligations.
Borrower acknowledges that Lender has a valid interest in maintaining the value
of the Property so as to ensure that, should Borrower default in the repayment
of the Debt or the performance of the Other Obligations, Lender can recover the
Debt by sale of the Property.
Section 8.2 NO SALE/ENCUMBRANCE.
(a) Borrower agrees that Borrower shall not, without the prior
written consent of Lender, Transfer the property or any part thereof or
permit the Property or any part thereof to be Transferred. Lender shall
not be required to demonstrate any actual impairment of its security or
any increased risk of default hereunder in order to declare the Debt
immediately due and payable upon Borrower's Transfer of the Property
without Lender's consent.
(b) As used in Section 8.2(a), "Transfer" shall mean any
voluntary or involuntary sale, conveyance, mortgage, grant, bargain,
encumbrance, pledge, assignment or transfer of all or any part of the
Property or any interest therein including, but not limited to: (i) an
installment sales agreement wherein Borrower agrees to sell the
Property or any part thereof for a price to be paid in installments;
(ii) an agreement by Borrower leasing all or a substantial part of the
Property for other than actual occupancy by a space tenant thereunder;
(iii) a sale, assignment or other transfer of, or the grant of a
security interest in, Borrower's right, title and interest in and to
any Lease or any Rents; (iv) if Borrower, Guarantor, or any managing
member or general partner of Borrower or Guarantor is a corporation,
any Transfer of such corporation's stock (or the stock of any
corporation directly or indirectly controlling such Borrower,
Guarantor, managing member or general partner by operation of law or
otherwise) or the creation or issuance of new stock in one or a series
of transactions by which an aggregate of forty-nine percent (49%) or
more of such corporation's stock shall directly or indirectly be vested
in or pledged to a party or parties who are not now stockholders
(provided, however, in no event shall this subpart [iv] apply to any
Guarantor whose stock or shares are traded on a nationally recognized
stock exchange); (v) if Borrower, Guarantor, or any managing member or
general partner of Borrower or Guarantor is a limited liability company
or partnership, the Transfer by which an aggregate of forty-nine
percent (49%) or more of the ownership interest in such limited
liability company or forty-nine percent (49%) or more of the
partnership interests in such partnership shall directly or indirectly
be vested in or pledged to parties not having an ownership interest as
of the date of this Security Instrument; (vi) if Borrower, any
Guarantor or any managing member or general partner of Borrower or any
Guarantor is a partnership, limited liability company or joint venture,
the change, removal or resignation of a general partner, managing
member or joint venture or the Transfer directly or indirectly of all
or any portion of the partnership or ownership interest of any general
partner, managing member or joint venture; and (vii) except as
expressly permitted by Section 8.3, any Transfer by an Original
Principal, directly or indirectly, of its ownership interest in the
Borrower.
Section 8.3 EXCLUDED AND PERMITTED TRANSFERS.
JPMORGAN CHASE BANK
27
(a) A Transfer within the meaning of this Article 8 shall not
include (i) transfers of ownership interests in the Borrower, any
general partner or managing member or any Guarantor made by devise or
descent or by operation of law upon the death of a joint tenant,
partner, member or shareholder, subject, however, to all the following
requirements: (A) written notice of any transfer under this Section
8.3, whether by will, trust or other written instrument, operation of
law or otherwise is provided to Lender or its servicer, together with
copies of such documents relating to the transfer as Lender or its
servicer may reasonably request, (B) control over the management and
operation of the Property is retained by one or more of ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (the "ORIGINAL PRINCIPALS", whether one or
more) at all times prior to the death or legal incapacity of all the
Original Principals and is thereafter assumed by persons who are
acceptable in all respect to Lender in its sole and absolute
discretion, (C) no such transfer by any of the Original Principals will
release the respective estate from any liability as a Guarantor, and
(D) no such transfer, death or other event has any adverse effect
either on the bankruptcy-remote status of Borrower under the
requirements of any national rating agency for the Securities
(hereinafter defined) or on the status of Borrower as a continuing
legal entity liable for the payment of the Debt and the performance of
all other obligations secured hereby, (ii) transfers otherwise by
operation of law in the event of a bankruptcy, (iii) a Lease of a
portion of the Property to a space tenant, (iv) pledges of equity
interests in any indirect owner of the Borrower other than the Borrower
itself and its immediate members and managers, or (v) transfers of
ownership interests in Borrower, any general partner or managing member
of Borrower to an affiliate of the Original Principals or to an
affiliate of Wafra Investment Advisory Group, Inc. ("Wafra").
(b) Notwithstanding any provision of this Security Instrument
to the contrary, the prohibitions in Subsection 8.2(a) shall not apply
to an inter vivos or testamentary transfer of all or any portion of
ownership interests in the Borrower, any general partner or managing
member or any Guarantor to one or more family members or Original
Principals or a trust in which all of the beneficial interest is held
by one or more family members or Original Principals or a partnership
or limited liability company in which a majority of the capital and
profits interests are held by one or more family members of Original
Principals, or (ii) any inter vivos or testamentary transfer or
issuance of capital stock in Borrower or the general partner of
Borrower to one or more family members of Original Principals or to a
trust in which all of the beneficial interest is held by one or more
family members of Original Principals or a partnership or limited
liability company in which a majority of the capital and profits
interests are held by one or more family members of Original
Principals; provided, that any inter vivos transfer of all or any
portion of the ownership interests in the Borrower or such Guarantor or
any inter vivos transfer or issuance of capital stock in Borrower or
Borrower's general partner is made in connection with Original
Principals' bona fide, good faith estate planning and that the
person(s) with voting control of Borrower or the management of the
Property are (i) the same person(s) who had such voting control and
management rights immediately prior to the transfer in question, or
(ii) reasonably acceptable to Lender and provided further that no such
transfer shall have any adverse effect on the bankruptcy remote status
of Borrower under the requirements of any national rating agency for
the Securities. Lender acknowledges that Original Principals and/or an
Original Principal's spouse are acceptable to exercise voting control
of Borrower and the management of the Property.
JPMORGAN CHASE BANK
28
As used herein, "family members" shall include the spouse, children and
grandchildren and any lineal descendants.
(c) Notwithstanding the provisions of Section 8.2 above,
Lender will give its consent to three separate sales or transfers of
the Property or ownership interests in the Borrower, a general partner
or managing member of the Borrower, or any Guarantor, if (but only if)
no Event of Default under the Loan Documents has occurred and is
continuing, and if each of the following conditions precedent have been
fully satisfied (as determined in Lender's sole and absolute
discretion): (i) the grantee's or transferee's integrity, reputation,
financial condition, character and management ability are satisfactory
to Lender in its sole discretion and all information relation thereto
requested by Lender is delivered to Lender at least 30 days prior to
the proposed transfer, (ii) the grantee's or transferee's (and its sole
general partner's of managing member's) single purpose and bankruptcy
remote character are satisfactory to Lender on its sole discretion, and
all information relating thereto requested by Lender is delivered to
Lender at least 30 days prior to the proposed transfer, (iii) Lender
has obtained such estoppels from any guarantors of the Note or
replacement guarantors and such other legal opinions regarding
substantive consolidation issued, enforceability of the assumption
documents, no adverse impact on the Securities or any REMIC holding the
Note and similar matters as Lender may require, (iv) all of Lender's
costs and expenses associated with the sale or transfer (including
reasonable attorneys' fees) are paid by Borrower or the grantee or
transferee, (v) except in the case of a transfer of a direct or
indirect interest in the managing member's interest in the Borrower to
an affiliate of Wafra or an affiliate of the Original Principals, the
payment of a transfer fee not to exceed 1% of the then unpaid principal
balance of the loan evidenced by the Note and secured hereby (the
"LOAN"), (vi) the execution and delivery to Lender of a written
assumption agreement and/or substitute guaranty (in its sole and
absolute discretion) and such modifications to the Loan Documents
executed by such parties and containing such terms and conditions as
Lender may require in its sole and absolute discretion prior to such
sale or transfer (provided that in the event the Loan is included in a
REMIC and is a performing Loan, no modification to the terms and
conditions shall be made or permitted that would cause (A) any adverse
tax consequences to the REMIC or any holders of any Mortgage-Backed
Pass-Through Securities, (B) the Security Instrument to fail to be a
Qualifying Security Instrument under applicable federal law relation to
REMIC's, or(C) result in a taxation of the income from the Loan to the
REMIC or cause a loss of REMIC status), and (vii) if applicable, the
delivery to Lender of an endorsement (at Borrower's sole cost and
expense) to Lender's policy of title insurance then insuring the lien
created by this Security Instrument in form and substance acceptable to
Lender in its sole judgment.
(d) Without limiting the foregoing, if Lender shall consent to
a transfer of the Property, the written assumption agreement described
in Subsection 8.3(c)(vi) above shall provide for the release of
Borrower and, if approved by Lender, each Guarantor and Indemnitor of
personal liability under the Note and Other Loan Documents, but only as
to acts or events occurring, or obligations arising, after the closing
of such transfer.
Section 8.4 NO IMPLIED FUTURE CONSENT. Lender's consent to one sale,
conveyance, alienation, mortgage, encumbrance, pledge or transfer of the
Property shall not be
JPMORGAN CHASE BANK
29
deemed to be a waiver of Lender's right to require such consent to any future
occurrence of same. Any sale, conveyance, alienation, mortgage, encumbrance,
pledge or transfer of the Property made in contravention of this Article 8 shall
be null and void and of no force and effect.
Section 8.5 COSTS OF CONSENT. Borrower agrees to bear and shall pay or
reimburse Lender on demand for all reasonable expenses (including, without
limitation, all recording costs, reasonable attorneys' fees and disbursements
and title search costs) incurred by Lender in connection with the review,
approval and documentation of any such sale, conveyance, alienation, mortgage,
encumbrance, pledge of transfer.
Section 8.6 CONTINUING SEPARATENESS REQUIREMENTS. In no event shall any
of the terms and provisions of this Article 8 amend or modify the terms and
provisions contained in Section 4.3 herein.
ARTICLE 9 - DEFAULT
Section 9.1 EVENTS OF DEFAULT. The occurrence of any one or more of the
following events shall constitute an "EVENT OF DEFAULT":
(a) if any portion of the Debt is not paid on or prior to the
calendar day the same is due or if the entire Debt is not paid on or
before the maturity date, alone with applicable prepayment premiums, if
any;
(b) if Borrower, or its general partner or managing member, if
applicable, violates or does not comply with any of the provisions of
Section 4.3 or Article 8, or fails to deliver any of the reports
required by Section 3.8; provided, however, that the first failure to
deliver reports required by Section 3.8 during any twelve month period
commencing on the date hereof and each anniversary of the date hereof
shall not constitute and Event of Default unless such failure remains
uncured for ten calendar days after written notice by Lender to
Borrower of such failure;
(c) if any representation or warranty of Borrower or of its
members, general partners, principals, affiliates, agents or employees,
or of any Guarantor mane herein or in the Environmental Indemnity or in
any other Loan Document, in any guaranty, or in any certificate,
report, financial statement or other instrument or document furnished
to Lender shall have been false or misleading in any material respect
when made;
(d) if Borrower or any Guarantor shall make an assignment for
the benefit of creditors or if Borrower or any Guarantor shall admit in
writing its inability to pay, or Borrower's or any Guarantor's failure
to pay its debts as they become due;
(e) if (i) Borrower or any subsidiary or general partner or
managing member of Borrower, or any Guarantor shall commence any case,
proceeding or other action (A) under any existing or future law or any
jurisdiction, domestic or foreign, relation to bankruptcy, insolvency,
reorganization, conservatorship or relief of debtor, seeking to have
an order for relief entered with respect to it, or seeking to
adjudicate it a bankrupt or insolvent, or seeking reorganization,
arrangement, adjustment, winding-up, liquidation, dissolution,
composition or other relief with respect to it or its debts, or (B)
seeking
JPMORGAN CHASE BANK
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appointment of a receiver, trustee, custodian, conservator or other
similar official for it or for all or any substantial part of its
assets, or Borrower or any subsidiary or general partner or managing
member of Borrower, or any Guarantor shall make a general assignment
for the benefit of its creditors; or (ii) there shall be commenced
against Borrower or any subsidiary or general partner or managing
member of Borrower, or any Guarantor any case, proceeding or other
action of a nature referred to in clause (i) above which (A) results in
the entry of an order for relief or any such adjudication or
appointment or (B) remains undismissed, undischarged or unbonded for a
period of ninety (90) calendar days; or (iii) there shall be commenced
against Borrower or any subsidiary or general partner or managing
member of Borrower or any Guarantor any case, proceeding or other
action seeking issuance of a warrant or attachment, execution,
distraint or similar process against all or any substantial part or its
assets which results in the entry of any order for any such relief
which shall not have been vacated, discharged, or stayed or bonded
pending appeal within ninety(90) calendar days from the entry thereof;
or (iv) Borrower or any subsidiary or general partner or managing
member of Borrower, or any Guarantor shall take any action in
furtherance of, or indication its consent to, approval of, or
acquiescence in, any of the acts set forth in clause (i), (ii) or (iii)
above; or (v) Borrower or any subsidiary or general partner or managing
member of Borrower, or any Guarantor shall generally not, or shall be
unable to, or shall admit in writing its inability to, pay its debts as
they become due;
(f) subject to Borrower's right to contest certain liens as
provided in this Security Instrument. if the Property becomes subject
to any mechanic's, materialman's or other lien other than a lien for
local real estate taxes and assessments not then due and payable and
the lien shall remain undischarged of record (by payment, bonding or
otherwise) for a period of thirty (30) calendar days;
(g) if any federal tax lien is filed against Borrower, any
general partner or managing member of Borrower, any Guarantor or the
Property and same is not discharged of record within thirty (30)
calendar days after same is filed;
(h) Except as permitted in this Security Instrument, the
actual or threatened alteration, improvement, demolition or removal of
any of the Improvements without the prior consent of Lender;
(i) damage to the Property in any manner which is not covered
by insurance, which lack of coverage arises solely as a result of
Borrower's failure to maintain the insurance required under this
Security Instrument;
(j) without Lender's prior consent, (i) any managing agent for
the Property resigns or is remover, (ii) the ownership, management or
control of such managing agent is transferred to a person or entity
other than the general partner of managing member of the Borrower, or
(iii) there is any material change in the property management agreement
of the Property;
(k) this Security Instrument shall cease to constitute a
first-priority lien on the Property) other than in accordance with its
terms);
JPMORGAN CHASE BANK
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(l) seizure or forfeiture of the Property, or any portion
thereof, of Borrower's interest therein, resulting from criminal
wrongdoing or other unlawful action of Borrower, its affiliates, or any
tenant in the Property under any federal, state or local law;
(m) if Borrower consummates a transaction which would cause
the Security Instrument or Lender's exercise of its rights under this
Security Instrument, the Note or the Other Loan Documents to constitute
a nonexempt prohibited transaction under ERISA or result in a violation
of a state statute regulating governmental plans, subjecting Lender to
liability for a violation of ERISA or a state statute;
(n) if any default occurs under any guaranty or indemnity
including the Environmental Indemnity executed in connection herewith
and such default continues after the expiration of applicable grace
periods, or such guaranty or indemnity shall cease to be in full force
and effect, or any guarantor or indemnitor shall deny or disaffirm its
obligation thereunder; and
(o) if Borrower or any Guarantor, as the case may be, shall
continue to be in default under any other term, covenant or condition
of this Security Instrument or any Other Loan Documents for thirty (30)
calendar days after notice from Lender; provided that if such default
cannot reasonably be cured within such thirty (30) calendar day period
and Borrower (or such Guarantor as the case may be) shall have
commenced to cure such default within such thirty (30) calendar day
period and thereafter diligently and expeditiously proceeds to cure the
same, such thirty (30) calendar day period shall be extended for so
long as it shall require Borrower (or such Guarantor as the case may
be) in the exercise of due diligence of cure such default, it being
agreed that no such extension shall be for a period in excess in sixty
(60) calendar days after the notice from Lender referred to above.
Section 9.2 DEFAULT INTEREST. Borrower will pay, form the date of an
Event of Default through the earlier of the date upon which the Event of Default
is cured or the date upon which the Debt is paid in full, interest on the unpaid
principal balance of the Note at a per annum rate equal to the lesser of (a) the
greater of (i) five percent (5%) plus the Prime Rate (as defined in the Note),
and (ii) five percent (5%) plus the Applicable Interest Rate (as defined in the
Note), and (b) the maximum interest rate which Borrower may by law pay or Lender
may charge and collect (the "DEFAULT RATE").
ARTICLE 10 - RIGHTS AND REMEDIES
Section 10.1 REMEDIES. Upon the occurrence of any Event of Default,
Borrower agrees that Lender may take such action, by or through Trustee, by
Lender itself or otherwise, without notice or demand, as it deems advisable to
protect and enforce its rights against Borrower and in and to the Property,
including, but not limited to, the following actions, each of which may be
pursued concurrently or otherwise, at such time and in such order as Lender may
determine, in its sole discretion, without impairing or otherwise affecting the
other rights and remedies of Lender:
JPMORGAN CHASE BANK
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(a) Right to Perform Borrower's Covenants. If Borrower has
failed to keep or perform any covenant whatsoever contained in this
Security Instrument or the Other Loan Documents, Lender may, but shall
not be obligated to any person to do so, perform or attempt to perform
said covenant and any payment made or expense incurred in the
performance of attempted performance of any such covenant, together
with any sum expended by Lender that is chargeable to Borrower or
subject to reimbursement by Borrower under the Loan Documents, shall be
and become a part to the "Debt", and Borrower promises, upon demand, to
pay to Lender, at the place where the Note is payable, all sums so
incurred, paid or expended by Lender, with interest from the date when
paid, incurred or expended by Lender at the Default Rate.
(b) Right of Entry. Lender may, prior or subsequent to the
institution of any foreclosure proceedings, enter upon the Property, or
any part thereof, and take exclusive possession of the Property and of
all books records, and accounts relating thereto and to exercise
without interference from Borrower any and all rights which Borrower
has with respect to the management, possession, operation, protection,
or preservation of the Property, including without limitation the right
to rent the same for the account of Borrower and to deduct from such
Rents all costs, expenses, and liabilities of every character incurred
by Lender in collecting such Rents and in managing, operating,
maintaining, protecting, or preserving the Property and to apply the
remainder of such Rents on the Debt in such manner as Lender may elect.
All such costs, expenses, and liabilities incurred by Lender in
collecting such Rents and in managing, operating, maintaining,
protecting, or preserving the Property, if not paid out of Rents as
hereinabove provided, shall constitute a demand obligation owing by
Borrower and shall bear interest from the date of expenditure until
paid at the Default Rate, all of which shall constitute a portion of
the Debt. If necessary to obtain the possession provided for above,
Lender may invoke any and all legal remedies to dispossess Borrower,
including specifically one or more actions for forcible entry and
detainer, trespass to try title, and restitution. In connection with
any action taken by Lender pursuant to this Subsection 10.1(b), Lender
shall not be liable for any loss sustained by Borrower resulting from
any failure to let the Property, or any part thereof, or from any other
act or omission of Lender in managing the Property unless such loss is
caused by the willful misconduct or gross negligence of Lender, nor
shall Lender be obligated to perform or discharge any obligation, duty,
or liability under any Lease or under or by reason hereof or the
exercise of rights or remedies hereunder. Borrower shall and does
hereby agree to indemnify Lender for, and to hold Lender harmless from,
any and all liability, loss, or damage, which may or might be incurred
by Lender under any such Lease or under or by reason hereof or the
exercise of rights or remedies hereunder, and from any and all claims
and demands whatsoever which may be asserted against Lender by reason
of any alleged obligations or undertakings on its part to perform or
discharge any of the terms, covenants, or agreements contained in any
such Lease. Should Lender incur any such liability, the amount thereof,
including without limitations costs, expenses, and reasonable
attorneys' fees, together with interest thereon from the date of
expenditure until paid at the Default Rate, shall be secured hereby,
and Borrower shall reimburse Lender therefor immediately upon demand.
Nothing in this Subsection 10.1(b) shall impose any duty, obligation,
or responsibility upon Lender for the control, care, management,
leasing, or repair of the Property, nor for the carrying out of any of
the terms and conditions of any
JPMORGAN CHASE BANK
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such Lease; nor shall it operate to make Lender responsible or liable
for any waste committed on the Property by the tenants or by any other
parties, or for any hazardous substances or environmental conditions on
or under the Property, or for dangerous or defective condition of the
Property or for any negligence in the management, leasing, upkeep,
repair, or control of the Property resulting in loss or injury or death
to any tenant, licensee, employee, or stranger. Borrower hereby assents
to, ratifies, and confirms any and all actions of Lender with respect
to the Property taken under this subsection.
(c) Right to accelerate. Upon Borrower's breach of any
covenant or agreement of Borrower in this Instrument, including, but
not limited to, the covenants to pay when due any sums secured by this
Instrument, Lender at Lender's option may declare all of the sums
secured by this Instrument to be immediately due and payable without
further demand, and may invoke the power of sale and any other remedies
permitted by applicable law or provided herein. Borrower acknowledges
that the power of sale herein granted may be exercised by Lender
without prior judicial hearing. Borrower has the right to bring an
action to assert the non-existence of a breach or any other defense of
Borrower to acceleration and sale. Lender shall be entitled to collect
all costs and expenses incurred in pursuing such remedies, including,
but not limited to, reasonable attorney's fees and costs of documentary
evidence, abstracts and title reports.
(d) Foreclosure-Power of Sale. Lender may institute a
proceeding or proceedings, judicial, or nonjudicial, by advertisement
or otherwise, for the complete or partial foreclosure of this Security
Instrument or the complete or partial sale of the Property under power
of sale or under any applicable provision of law. Lender may, through
the Trustee, sell the Property, and all estate, right, title, interest,
claim and demand of Borrower therein, and all rights of redemption
thereof, at one or more sales, as an entirety or in parcels, with such
elements of real and/or personal property, and at such time and place
and upon such terms as it may deem expedient, or as may be required by
applicable law, and in the event of a sale, by foreclosure or
otherwise, of less than all of the Property, this Security Instrument
shall continue as a lien and security interest on the remaining portion
of the Property. If Lender invokes the power of sale, Lender or Trustee
shall give to Borrower a copy of a notice of sale in the manner
prescribed by applicable law. Trustee shall give public notice of sale
in the manner prescribed by applicable law and shall sell the Property
in accordance with the laws of Virginia. Trustee, without demand on
Borrower, shall sell the Property at public auction to the highest
bidder at the time and place and under the terms designated in the
notice of sale in one or more parcels and in such order as Trustee may
determine. Trustee may postpone sale of all or any parcel of the
Property by public announcement at the time and place of any previously
scheduled sale or by advertising in accordance with applicable law.
Lender or Lender's designee may purchase the Property at any sale
subject to the provisions of Section 10.1(e)(vi) below.
(e) Rights Pertaining to Sales. Subject to the requirements of
applicable law and except as otherwise provided herein, the following
provisions shall apply to any sale or sales of all or any portion of
the Property under or by virtue of Subsection 10.1(d) above, whether
made under the power of sale herein granted or by virtue of judicial
proceedings or of a judgment or decree of foreclosure and sale:
JPMORGAN CHASE BANK
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(i) Trustee or Lender may conduct any number of sales
from time to time. The power of sale set forth above shall not be
exhausted by any one or more such sales as to any part of the Property
which shall not have been sold, nor by any sale which is not completed
or is defective in Lender's opinion, until the Debt shall have been
paid in full.
(ii) Any sale may be postponed or adjourned by public
announcement at the time and place appointed for such sale or for such
postponed or adjourned sale without further notice.
(iii) Trustee shall deliver to the purchaser Trustee's deed
conveying the Property so sold with special warranty of title. The
recitals in Trustee's deed shall be prima facie evidence of the truth
of the statements made therein. Trustee shall apply the proceeds of the
sale in the following order: (a) to all costs and expenses of the sale,
including, but not limited to, Trustee's fees of 2% of the gross sale
price, attorney's fees and costs of title evidence; (b) to the
discharge of all taxes, levies and assessments on the Property, if any,
as provided by applicable law; (c) to all sums secured by this
Instrument in such order as Lender, in Lender's sole discretion,
directs; and (d) the excess, if any, to the person or persons legally
entitled thereto, including, if any, holders of liens inferior to this
Instrument in order of their priority, provided that Trustee has actual
notice of such liens. Trustee shall not be required to take possession
of the Property prior to the sale thereof or to deliver possession of
the Property to the purchaser at such sale.
(iv) Any and all statements of fact or other recitals made
in any of the instruments referred to in Subsection 10.1(e)(iii)
given by Trustee or Lender shall be taken as conclusive and binding
against all persons as to evidence of the truth of the facts so stated
and recited.
(v) Any such sale or sales shall operate to divest all of
the estate, right, title, interest, claim and demand whatsoever,
whether at law or in equity, of Borrower in and to the properties and
rights so sold, and shall be a perpetual bar both at law and in equity
against Borrower and any and all persons claiming or who may claim the
same, or any part thereof or any interest therein, by, through or under
Borrower to the fullest extent permitted by applicable law.
(vi) Upon any such sale or sales, Lender may bid for and
acquire the Property and, in lieu of paying cash therefor, may make
settlement for the purchase price by crediting against the Debt the
amount of the bid made therefor, after deducting therefrom the
expenses of the sale, the cost of any enforcement proceeding hereunder,
and any other sums which Trustee or Lender is authorized to deduct
under the terms hereof, to the extent necessary to satisfy such bid.
(vii) Upon any such sale, it shall not be necessary for
Trustee, Lender or any public officer acting under execution or order
of court to have present or constructively in its possession any of the
Property.
JPMORGAN CHASE BANK
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(f) Lender's Judicial Remedies. Lender, or Trustee upon written request
of Lender, may proceed by suit or suits, at law or in equity, to enforce the
payment of the Debt to foreclose the liens and security interests of this
Security Instrument as against all or any part of the Property, and to have
all or any part of the Property sold under the judgment or decree of a court of
competent jurisdiction. This remedy shall be cumulative of any other nonjudicial
remedies available to Lender under this Security Instrument, the Note or the
Other Loan Documents. Proceeding with a request or receiving a judgment for
legal relief shall not be or be deemed to be an election of remedies or bar any
available nonjudicial remedy of Lender.
(g) Lender's Right to Appointment of Receiver. Lender, as a matter of
right and (i) without regard to the sufficiency of the security for repayment of
the Debt and without notice to Borrower, (ii) without any showing of insolvency,
fraud, or mismanagement on the part of Borrower, (iii) without the necessity of
filing any judicial or other proceeding other than the proceeding for
appointment of a receiver, and (iv) without regard to the then value of the
Property, shall be entitled to the appointment of a receiver or receivers for
the protection, possession, control, management and operation of the Property,
including (without limitation), the power to collect the Rents, enforce this
Security Instrument and, in case of a sale and deficiency, during the full
statutory period of redemption (if any), whether there be a redemption or not,
as well as during any further times when Borrower, except for the intervention
of such receiver, would be entitled to collection of such Rents. Borrower hereby
irrevocably consents to the appointment of a receiver or receivers. Any receiver
appointed pursuant to the provisions of this subsection shall have the usual
powers and duties of receivers in such matters.
(h) Commercial Code Remedies. Lender may exercise any and all rights
and remedies granted to a secured party upon default under the Uniform
Commercial Code, including, without limiting the generality of the foregoing:
(i) the right to take possession of the Personal Property or any part thereof,
and to take such other measures as Lender may deem necessary for the care,
protection and preservation of the Personal Property, and (ii) request Borrower
at its expense to assemble the Personal Property and make it available to Lender
at a convenient place acceptable to Lender. Any notice of sale, disposition or
other intended action by Lender with respect to the Personal Property sent to
Borrower in accordance with the provisions hereof at least five (5) days prior
to such action, shall constitute commercially reasonable notice to Borrower.
(i) Apply Escrow Funds. Lender may apply any Funds (as defined in the
Escrow Agreement) and any other sums held in escrow or otherwise by Lender in
accordance with the terms of this Security Instrument or any Other Loan Document
to the payment of the following items in any order in its uncontrolled
discretion:
(i) Taxes and Other Charges;
(ii) Insurance Premiums;
(iii) Interest on the unpaid principal balance of the Note;
JPMORGAN CHASE BANK
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(iv) Amortization of the unpaid principal balance of the
Note; and
(v) All other sums payable pursuant to the Note, this
Security Instrument and the Other Loan Documents, including without
limitation advances made by Lender pursuant to the terms of this
Security Instrument.
(j) Other Rights. Lender (i) may surrender the Policies maintained
pursuant to this Security Instrument or any part thereof, and upon receipt shall
apply the unearned premiums as a credit on the Debt, and, in connection
therewith, Borrower hereby appoints Lender as agent and attorney-in-fact (which
is coupled with an interest and is therefore irrevocable) for Borrower to
collect such premiums; and (ii) may apply the Tax and Insurance Escrow Fund (as
defined in the Escrow Agreement) and/or the Replacement Escrow Fund (as defined
in the Escrow Agreement) and any other funds held by Lender toward payment of
the Debt; and (iii) shall have and may exercise any and all other rights and
remedies which Lender may have at law or in equity, or by virtue of any of the
Loan Documents, or otherwise.
(k) Discontinuance of Remedies. In case Lender shall have proceeded to
invoke any right, remedy, or recourse permitted under the Loan Documents and
shall thereafter elect to discontinue or abandon same for any reason, Lender
shall have the unqualified right so to do and, in such event, Borrower and
Lender shall be restored to their former positions with respect to the Debt, the
Loan Documents, the Property or otherwise, and the rights, remedies, recourses
and powers of Lender shall continue as if same had never been invoked:
(l) Remedies Cumulative. All rights, remedies, and recourses of Lender
granted in the Note, this Security Instrument and the Other Loan Documents, any
other pledge of collateral, or otherwise available at law or equity: (i) shall
be cumulative and concurrent; (ii) may be pursued separately, successively, or
concurrently against Borrower, the Property, or any one or more of them, at the
sole discretion of Lender; (iii) may be exercised as often as occasion therefor
shall arise, it being agreed by Borrower that the exercise or failure to
exercise any of same shall in no event be construed as a waiver or release
thereof or of any other right, remedy, or recourse; (iv) shall be nonexclusive;
(v) shall not be conditioned upon Lender exercising or pursuing any remedy in
relation to the Property prior to Lender bringing suit to recover the Debt; and
(vi) in the event Lender elects to bring suit on the Debt and obtains a judgment
against Borrower prior to exercising any remedies in relation to the Property,
all liens and security interests, including the lien of this Security
Instrument, shall remain in full force and effect and may be exercised
thereafter at Lender's option.
(m) Bankruptcy Acknowledgment. In the event the Property or any portion
thereof or any interest therein becomes property of any bankruptcy estate or
subject to any state or federal insolvency proceeding, then Lender shall
immediately become entitled, in addition to all other relief to which Lender may
be entitled under this Security Instrument, to obtain (i) an order from the
Bankruptcy Court or other appropriate court granting immediate relief from the
automatic stay pursuant to Section 362 of the Bankruptcy Code so to permit
Lender to pursue its rights and remedies against Borrower as provided
JPMORGAN CHASE BANK
37
under this Security Instrument and all other rights and remedies of Lender at
law and in equity under applicable state law, and (ii) an order from the
Bankruptcy Court prohibiting Borrower's use of all "cash collateral" as defined
under Section 363 of the Bankruptcy Code. In connection with such Bankruptcy
Court orders, Borrower shall not contend or allege in any pleading or petition
filed in any court proceeding that Lender does not have sufficient grounds for
relief from the automatic stay. Any bankruptcy petition or other action taken by
the Borrower to stay, condition, or inhibit Lender from exercising its remedies
are hereby admitted by Borrower to be in bad faith and Borrower further admits
that Lender would have just cause for relief from the automatic stay in order to
take such actions authorized under state law.
(n) Application of Proceeds. The proceeds from any sale, lease, or
other disposition made pursuant to this Security Instrument, or the proceeds
from the surrender of any insurance policies pursuant hereto, or any Rents
collected by Lender from the Property, or the Tax and Insurance Escrow Fund or
the Replacement Escrow Fund (as defined in the Escrow Agreement) or proceeds
from insurance which Lender elects to apply to the Debt pursuant to Article 3
hereof, shall be applied by Trustee, or by Lender, as the case may be, to the
Debt in the following order and priority: (1) to the payment of all expenses of
advertising, selling, and conveying the Property or part thereof, and/or
prosecuting or otherwise collecting Rents, proceeds, premiums or other sums
including reasonable attorneys' fees and a reasonable fee or commission to
Trustee, not to exceed five percent of the proceeds thereof or sums so received;
(2) to that portion, if any, of the Debt with respect to which no person or
entity has personal or entity liability for payment (the "EXCULPATED PORTION"),
and with respect to the Exculpated Portion as follows: first, to accrued but
unpaid interest, second, to matured principal, and third, to unmatured principal
in inverse order of maturity; (3) to the remainder of the Debt as follows:
first, to the remaining accrued but unpaid interest, second, to the matured
portion of principal of the Debt, and third, to prepayment of the unmatured
portion, if any, of principal of the Debt applied to installments of principal
in inverse order of maturity; (4) the balance, if any or to the extent
applicable, remaining after the full and final payment of the Debt to the holder
or beneficiary of any inferior liens covering the Property, if any, in order of
the priority of such inferior liens (Trustee and Lender shall hereby be entitled
to rely exclusively on a commitment for title insurance issued to determine such
priority); and (5) the cash balance, if any, to the Borrower. The application of
proceeds of sale or other proceeds as otherwise provided herein shall be deemed
to be a payment of the Debt like any other payment. The balance of the Debt
remaining unpaid, if any, shall remain fully due and owing in accordance with
the terms of the Note and the other Loan Documents.
Section 10.2 [Intentionally omitted]
ARTICLE 11 - INDEMNIFICATION; SUBROGATION
Section 11.1 GENERAL INDEMNIFICATION.
(a) Borrower shall indemnify, defend and hold Lender and Trustee
harmless against: (i) any and all claims for brokerage, leasing, finder's or
similar fees which may be made relating to the Property or the Debt, and (ii)
any and all liability, obligations,
JPMORGAN CHASE BANK
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losses, damages, penalties, claims, actions, suits, costs and expenses
(including Lender's reasonable attorneys' fees, together with reasonable
appellate counsel fees, if any) of whatever kind or nature which may be asserted
against, imposed on or incurred by Lender or Trustee in connection with the
Debt, this Security Instrument, the Property, or any part thereof, or the
exercise by Lender or Trustee of any rights or remedies granted to it under this
Security Instrument; provided, however, that nothing herein shall be construed
to obligate Borrower to indemnify, defend and hold harmless Lender from and
against any and all liabilities, obligations, losses, damages, penalties,
claims, actions, suits, costs and expenses enacted against, imposed on or
incurred by Lender by reason of Lender's willful misconduct or gross negligence.
(b) If Lender is made a party defendant to any litigation or any claim
is threatened or brought against Lender concerning the secured indebtedness,
this Security Instrument, the Property, or any part thereof, or any interest
therein, or the construction, maintenance, operation or occupancy or use
thereof, then Lender shall notify Borrower of such litigation or claim and
Borrower shall indemnify, defend and hold Lender harmless from and against all
liability by reason of said litigation or claims, including reasonable
attorneys' fees (together with reasonable appellate counsel fees, if any). The
right to such attorneys' fees (together with reasonable appellate counsel fees,
if any) and expenses incurred by Lender in any such litigation or claim of the
type described in this Subsection 11.1(b), whether or not any such litigation or
claim is prosecuted to judgment, shall be deemed to have accrued on the
commencement of such claim or action and shall be enforceable whether or not
such claim or action is prosecuted to judgment. If Lender commences an action
against Borrower to enforce any of the terms hereof or to prosecute any breach
by Borrower of any of the terms hereof or to recover any sum secured hereby,
Borrower shall pay to Lender its reasonable attorneys' fees (together with
reasonable appellate counsel fees, if any) and expenses. If Borrower breaches
any term of this Security Instrument, Lender may engage the services of an
attorney or attorneys to protect its rights hereunder, and in the event of such
engagement following any breach by Borrower, Borrower shall pay Lender
reasonable attorneys' fees (together with reasonable appellate counsel fees, if
any) and expenses incurred by Lender, whether or not an action is actually
commenced against Borrower by reason of such breach. All references to
"ATTORNEYS" in this Subsection 11.1(b) and elsewhere in this Security Instrument
shall include without limitation any attorney or law firm engaged by Lender and
Lender's in-house counsel, and all references to "FEES AND EXPENSES" in this
Subsection 11.1(b) and elsewhere in this Security Instrument shall include
without limitation any fees of such attorney or law firm and any allocation
charges and allocation costs of Lender's in-house counsel.
(c) A waiver of subrogation shall be obtained by Borrower from its
insurance carrier and, consequently, Borrower waives any and all right to claim
or recover against Lender, its officers, employees, agents and representatives,
for loss of or damage to Borrower, the Property, Borrower's property or the
property of others under Borrower's control from any cause insured against or
required to be insured against by the provisions of this Security Instrument.
JPMORGAN CHASE BANK
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Section 11.2 ENVIRONMENTAL INDEMNIFICATION. Borrower shall, at its sole
cost and expense, protect, defend, indemnify, release and hold harmless the
Indemnified Parties from and against any and all Losses (as hereinafter defined)
imposed upon or incurred by or asserted against any Indemnified Parties (other
than those arising solely from a state of facts that first came into existence
after Lender acquired title to the Property through foreclosure or a deed in
lieu thereof), and directly or indirectly arising out of or in any way relating
to any one or more of the following: (a) any presence of any Hazardous
Substances (as hereinafter defined) in, on, above, or under the Property; (b)
any past, present or future Release (as hereinafter defined) of Hazardous
Substances in, on, above, under or from the Property; (c) any activity by
Borrower, any person or entity affiliated with Borrower, and any tenant or other
user of the Property in connection with any actual, proposed or threatened use,
treatment, storage, holding, existence, disposition or other Release,
generation, production, manufacturing, processing, refining, control,
management, abatement, removal, handling, transfer or transportation to or from
the Property of any Hazardous Substances at any time located in, under, on or
above the Property; (d) any activity by Borrower, any person or entity
affiliated with Borrower, and any tenant or other user of the Property in
connection with any actual or proposed Remediation (as hereinafter defined) of
any Hazardous Substances at any time located in, under, on or above the
Property, whether or not such Remediation is voluntary or pursuant to court or
administrative order, including but not limited to any removal, remedial or
corrective action; (e) any past, present or threatened non-compliance or
violations of any Environmental Law (as hereinafter defined) (or permits issued
pursuant to any Environmental Law) in connection with the Property or operations
thereon, including but not limited to any failure by Borrower, any person or
entity affiliated with Borrower, and any tenant or other user of the Property to
comply with any order of any governmental authority in connection with any
Environmental Laws; (f) the imposition, recording or filing or the future
imposition, recording or filing of any Environmental Lien (as hereinafter
defined) encumbering the Property; (g) any administrative processes or
proceedings or judicial proceedings in any way connected with any matter
addressed in this Section 11.2; (h) any misrepresentation or inaccuracy in any
representation or warranty or material breach or failure to perform any
covenants or other obligations under the Environmental Indemnity of even date
executed by Borrower and Indemnitor; and (i) and diminution in value of the
Property in any way connected with any occurrence or other matter referred to in
this Section 11.2.
The term "ENVIRONMENTAL LAW" means any present and future federal,
state and local laws, statutes, ordinances, rules, regulations and the like, as
well as common law, relating to protection of human health or the environment,
relating to liability for or costs of Remediation or prevention of Releases of
Hazardous Substances. The term "ENVIRONMENTAL LAW" includes, but is not limited
to, the following statutes, as amended any successor thereto, and any
regulations promulgated pursuant thereto, and any state or local statues,
ordinances, rules, regulations and the like addressing similar issues: the
Comprehensive Environmental Response, Compensation and Liability Act; the
Emergency Planning and Community Right-to-Know act; the Hazardous Substances
Transportation Act; the Resource Conservation and Recovery Act (including but
not limited to Subtitle I relating to underground storage tanks); the Solid
Waste Disposal Act; the Clean Water Act; the Clean Air Act; the Toxic Substances
Control Act; the Safe Drinking Water Act; the Occupational Safety and Health
Act; the Federal Water Pollution Control. Act; the Federal Insecticide,
Fungicide and Rodenticide Act; the Endangered Species Act; the National
Environmental Policy Act; and the river and Harbors Appropriation Act. the term
"ENVIRONMENTAL LAW" also includes, but is not limited to, any present and future
federal, state
JPMORGAN CHASE BANK
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and local laws, statutes, ordinances, rules, regulations and the like, as well
as common law: conditioning transfer of property upon a negative declaration or
other approval of a governmental authority of the environmental condition of the
Property; requiring notification or disclosure of Releases of Hazardous
Substances or other environmental condition of the Property to any governmental
authority or other person or entity, whether or not in connection with transfer
of title to or interest in property; imposing conditions or requirements in
connection with permits or other authorization for lawful activity; relating to
nuisance, trespass or other causes of action related to the Property; and
relating to wrongful death, personal injury, or property or other damage in
connection with any physical condition or use of the Property.
The term "ENVIRONMENTAL LIEN" includes but is not limited to any lien
or other encumbrance imposed pursuant to Environmental Law, whether due to any
act or omission of Borrower or any other person or entity.
The term "HAZARDOUS SUBSTANCES" includes but is not limited to any and
all substances (whether solid, liquid or gas) defined, listed, or otherwise
classified as pollutants, hazardous wastes, hazardous substances, hazardous
materials, extremely hazardous wastes, or words of similar meaning or
regulatory effect under any present or future Environmental Laws or that may
have a negative impact on human health or the environment, including but not
limited to petroleum and petroleum products, asbestos and asbestos-containing
materials, polychlorinated biphenyls, lead, lead-based paints, radon,
radioactive materials, flammables and explosives.
The term "INDEMNIFIED PARTIES" includes but is not limited to Lender,
any person or entity who is or will have been involved in originating the Loan
evidenced by the Note, any person or entity who is or will have been involved
in servicing the Loan, any person or entity in whose name the encumbrance
created by this Security Instrument is or will have been recorded, persons and
entities who may hold or acquire or will have held a full or partial interest
in the Loan (including but not limited to those who may acquire any interest in
Securities, as well as custodians, trustees and other fiduciaries who hold or
have held a full or partial interest in the Loan for the benefit of third
parties), as well as the respective directors, officers, shareholders,
partners, employees, agents, servants, representatives, contractors,
subcontractors, affiliates, subsidiaries, participants, successors and assign
of any and all of the foregoing (including but not limited to any other person
or entity who holds or acquires or will have held a participation or other full
or partial interest in the Loan or the Property, whether during the term of the
Loan or as part of or following foreclosure pursuant to the Loan) and including
but not limited to any successors by merger, consolidation or acquisition of
all or a substantial part of Lender's assets and business.
The term "LOSSES" includes but is not limited to any claims, suits,
liabilities (including but not limited to strict liabilities), administrative or
judicial actions or proceedings, obligations, debts, damages, losses, costs,
expenses, diminutions in value, fines, penalties, changes, fees, expenses, costs
of Remediation (whether or not performed voluntarily), judgments, award,
amounts paid in settlement, foreseeable and unforeseeable consequential damages,
litigation costs, attorneys' fees, engineer's fees, environmental consultants'
fees and investigation costs (including but not limited to costs for sampling,
testing and analysis of soil, water, air, building materials, and other
materials and substances whether solid, liquid or gas), of whatever kind or
JPMORGAN CHASE BANK
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nature, and whether or not incurred in connection with any judicial or
administrative proceedings.
The term "RELEASE" with respect to any Hazardous Substance includes but
is not limited to any release, deposit, discharge, emission, leaking, leaching,
spilling, seeping, migrating, injecting, pumping, pouring, emptying, escaping
dumping, disposing or other movement of Hazardous Substances.
The term "REMEDIATION" includes but is not limited to any response,
remedial, removal, or corrective action; any activity to cleanup, detoxify,
decontaminate, contain or otherwise remediate any Hazardous Substance; any
action to comply with any Environmental Laws or with any permits issued pursuant
thereto; any inspection, investigation, study, monitoring, assessment, audit,
sampling and testing, laboratory or other analysis, or evaluation relating to
any Hazardous Substances or to anything referred to in this Article 11.
Section 11.3 DUTY TO DEFEND AND ATTORNEYS AND OTHER FEES AND EXPENSES.
Upon written request by any Indemnified Party, Borrower shall defend such
Indemnified party (if requested by and Indemnified party, in the name of the
Indemnified party) by attorneys and other professionals approved by the
Indemnified Parties. Notwithstanding the foregoing, any Indemnified parties may,
in their sole and absolute discretion, engage their own attorneys and other
professionals to defend or assist them, and, at the option of Indemnified
Parties, their attorneys shall control the resolution of claim or proceeding.
Upon demand, Borrower shall pay or, in the sole and absolute discretion of the
Indemnified Parties, reimburse, the Indemnified Parties for the payment of
reasonable fees and disbursements of attorneys, engineers, environmental
consultants, laboratories and other professionals in connection therewith.
Section 11.4 SURVIVAL OF INDEMNITIES. Notwithstanding any provision of
this Security Instrument or any other Loan Document to the contrary, the
provisions of Section 11.1 and Section 11.2, and Borrower's obligations
thereunder, shall survive (a) the repayment of the Note, (b) the foreclosure of
this Security Instrument, and (c) the release (or reconveyance, as applicable)
of the lien of this Security Instrument.
ARTICLE 12 - SECURITY AGREEMENT
Section 12.1 SECURITY AGREEMENT. This Security Instrument is both a
real property mortgage and a "security agreement" within the meaning of the
Uniform Commercial Code. The Property includes both real and personal property
and all other rights and interests, whether tangible or intangible in nature, of
Borrower in the Property. Borrower by executing and delivering this Security
Instrument has granted and hereby grants to Lender, as security for the
Obligations, a security interest in the Property to the full extent that the
Property may be subject to the Uniform Commercial Code (said portion of the
Property so subject to the Uniform Commercial Code being called in this
paragraph the "COLLATERAL"). Borrower hereby agrees with Lender to execute and
deliver to Lender, in form and substance satisfactory to Lender, such financing
statements, continuation statements, other uniform commercial code forms and
shall pay all expenses and fees in connection with the filing and recording
thereof, and such further
JPMORGAN CHASE BANK
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assurances as Lender may from time to time, reasonably consider necessary to
create, perfect, and preserve Lender's security interest herein granted. This
Security Instrument shall also constitute a "fixture filing" for the purposes of
the Uniform Commercial Code. All or part of the Property are or are to become
fixtures. Information concerning the security interest herein granted may be
obtained from the parties at the addresses of the parties set forth in the first
paragraph of this Security Instrument. If an Event of Default shall occur,
Lender, in addition to any other rights and remedies which they may have, shall
have and may exercise immediately and without demand, any and all rights and
remedies granted to a secured party upon default under the Uniform Commercial
Code, including without limiting the generality of the foregoing, the right to
take possession of the Collateral or any part thereof, and to take such other
measures as Lender may deem necessary for the care, protection and preservation
of the Collateral. Upon request or demand of Lender, Borrower shall it expense
assemble the Collateral and make it available to Lender at convenient place
acceptable to Lender. Borrower shall pay to Lender on demand any and all
expenses, including legal expenses and attorney's fees, incurred or paid by
Lender in protecting the interest in the Collateral and in enforcing the rights
hereunder with respect to the Collateral. Any notice of sale, disposition or
other intended action by Lender with respect to the Collateral sent to Borrower
in accordance with the provisions hereof at least five (5) days prior to such
action, shall constitute commercially reasonable notice to Borrower. The
proceeds of any disposition of the Collateral, or any part thereof, may be
applied by Lender to the payment of the Obligations in such priority and
proportions as Lender in its discretion shall deem proper. In the event of any
change in name, identify or structure of any Borrower, such Borrower shall
notify Lender thereof, and promptly after request shall execute, file and record
such Uniform Commercial Code forms as are necessary to maintain the priority of
Leader's lien upon and security interest in the Collateral, and shall pay all
expenses and fees in connection with the filing and recording thereof. If Lender
shall require the filing or recording of additional Uniform Commercial Code
forms or continuation statements, Borrower shall, promptly after request,
execute, file and record such Uniform Commercial Code firms or continuation
statements as Lender shall deem necessary, and shall pay all expenses and fees
in connection with the filing and recording thereof it being understood and
agreed, however, that no such additional documents shall increase Borrower's
obligations under the Note, this Security Instrument and the Other Loan
Documents. Borrower hereby irrevocably appoints Lender as its attorney-in-fact,
coupled with an interest, to file with the appropriate public office on its
behalf any financing or other statements signed only by Lender, as Borrower's
attorney-in-fact, in connection with the Collateral covered by this Security
Instrument. Notwithstanding the foregoing, Borrower shall appear and defend in
any action or proceeding which affects or purports to affect the Property and
any interest or right therein, whether such proceedings effects title or any
other rights in the Property (and in conjunction therewith, Borrower shall fully
cooperate with Lender in the event Lender is a party to such action or
proceeding).
ARTICLE 13 - WAIVERS
Section 13.1 MARSHALLING AND OTHER MATTERS. Borrower hereby waives, to
the extent permitted by law, the benefit of all appraisement, valuation, stay,
extension, reinstatement and redemption laws now or hereafter in force and all
rights of marshalling in the event of any sale hereunder of the Property or any
or any part thereof or any interest therein. Further, Borrower hereby expressly
waives any and all rights of redemption from sale under any order or decree of
foreclosure of this Security Instrument on behalf of Borrower, and on behalf of
each
JPMORGAN CHASE BANK
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and every person acquiring any interest in or title to the Property subsequent
to the date of this Security Instrument and on behalf of all persons to the
extent permitted by applicable law.
Section 13.2 WAIVER OF NOTICE. Borrower shall not be entitled to any
notices of any nature whatsoever from Lender except with respect to matters for
which this Security Instrument specifically and expressly provides for the
giving of notice by Lender to Borrower and except with respect to matters for
which Lender is required by applicable law to give notice, and Borrower hereby
expressly waives the right to receive any notice from Lender with respect to any
matter for which this Security Instrument does not specifically and expressly
provide for the giving of notice by Lender to Borrower.
Section 13.3 SOLE DISCRETION OF LENDER. Wherever pursuant to this
Security Instrument Lender exercises any right given to it to approve or
disapprove, or any arrangement or term is to be satisfactory to Lender, the
decision of Lender to approve or disapprove or to decide that arrangements or
terms are satisfactory or not satisfactory shall be in the sole discretion of
Lender and shall be final and conclusive, except as many be otherwise expressly
and specifically provided herein.
Section 13.4 SURVIVAL. The indemnifications made pursuant to Article
11, shall continue indefinitely in full force and effect and shall survive and
shall in no way be impaired by: any satisfaction or other termination of this
Security Instrument, any assignment or other transfer of all or any portion of
this Security Instrument or Lender's interest in the Property (but, in such
case, shall benefit both Indemnified Parties and any assignee or transferee),
any exercise of Lender's rights and remedies pursuant hereto including but not
limited to foreclosure or acceptance of a deed in lieu of foreclosure, any
exercise of any rights and remedies pursuant to the Note or any of the Other
Loan Documents, any transfer of all or any portion of the Property (whether by
Borrower or by Lender following foreclosure or acceptance of a deed in lieu of
foreclosure or at any other time), any amendment to this Security Instrument,
the Note or the Other Loan Documents, and any act or omission that might
otherwise be construed as a release or discharge of Borrower from the
obligations pursuant hereto.
Section 13.5 WAIVER OF TRIAL BY JURY. BORROWER HEREBY AGREES NOT TO
ELECT A TRIAL BY JURY OF ANY ISSUE TRIABLE OF RIGHT BY JURY, AND WAIVES ANY
RIGHT TO TRIAL BY JURY FULLY TO THE EXTENT THAT ANY SUCH RIGHT SHALL NOW OR
HEREAFTER EXIST WITH REGARDS TO THIS SECURITY INSTRUMENT, THE NOTE OR THE OTHER
LOAN DOCUMENTS, OR ANY CLAIM, COUNTERCLAIM OR ANY OTHER ACTION ARISING IN
CONNECTION THEREWITH INCLUDING, BUT NOT LIMITED TO THOSE RELATING TO (A)
ALLEGATIONS THAT A PARTNERSHIP EXISTS BETWEEN LENDER AND BORROWER; (B) USURY OR
PENALTIES OR DAMAGES THEREFOR; (C) ALLEGATIONS OF UNCONSCIONABLE ACTS, DECEPTIVE
TRADE PRACTICE, LACK OF GOOD FAITH OR FAIR DEALING, LACK OF COMMERCIAL
REASONABLENESS, OR SPECIAL RELATIONSHIPS (SUCH AS FIDUCIARY, TRUST OR
CONFIDENTIAL RELATIONSHIP); (D) ALLEGATIONS OF DOMINION, CONTROL ALTER EGO,
INSTRUMENTALITY, FRAUD, REAL ESTATE FRAUD, MISREPRESENTATION, DURESS, COERCION,
UNDUE INFLUENCE, INTERFERENCE OR NEGLIGENCE; (E) ALLEGATIONS OF TORTIOUS
JPMORGAN CHASE BANK
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INTERFERENCE WITH PRESENT OF PROSPECTIVE BUSINESS RELATIONSHIP OR OF ANTITRUST;
OR (F) SLANDER, LIBEL OR DAMAGE TO REPUTATION. THIS WAIVER OF RIGHT TO TRIAL BY
JURY IS GIVEN KNOWINGLY AND VOLUNTARILY BY BORROWER, AND IS INTENDED TO
ENCOMPASS INDIVIDUALLY EACH INSTANCE AND EACH ISSUE AS TO WHICH THE RIGHT TO A
TRIAL BY JURY WOULD OTHERWISE ACCRUE. LENDER IS HEREBY AUTHORIZED TO FILE A COPY
OF THIS PARAGRAPH IN ANY PROCEEDING AS CONCLUSIVE EVIDENCE OF THIS WAIVER BY
BORROWER.
Section 13.6 WAIVER OF AUTOMATIC SUPPLEMENTAL STAY. In the event of the
filing of any voluntary or involuntary petition under the Bankruptcy Code by or
against Borrower (other than an involuntary petition filed by or joined in by
Lender), the Borrower shall not assert, or request any other party to assert,
that the automatic stay under Section 362 of the Bankruptcy Code shall operate
or be interpreted to stay, interdict, condition, reduce or inhibit the ability
of Lender to enforce any rights it has by virtue of this Security Instrument, or
any other rights that Lender has, whether now or hereafter acquired, against any
guarantor of the Debt. Further, Borrower shall not seek a supplemental stay or
any other relief, whether injunctive or otherwise, pursuant to Section 105 of
the Bankruptcy Code or any other provision therein to stay, interdict,
condition, reduce or inhibit the ability of Lender to enforce any rights it has
by virtue of this Security Instrument against any guarantor of the Debt. The
waivers contained in this paragraph are a material inducement to Lender's
willingness to enter into this Security Instrument and Borrower acknowledges and
agrees that no grounds exist for equitable relief which would bar, delay or
impede the exercise by Lender of Lender's rights and remedies against Borrower
or any guarantor of the Debt.
ARTICLE 14 - NOTICES
Section 14.1 NOTICES. All notices or other written communications
hereunder shall be deemed to have been properly given (i) upon delivery, if
delivered in person or by facsimile transmission with receipt acknowledged, (ii)
one (1) Business Day after having been deposited for overnight delivery with
any reputable overnight courier service, or (iii) three (3) Business Days after
having been deposited in any post office or mail depository regularly
maintained by the U.S. Postal Service and sent by registered or certified mail,
postage prepaid, addressed as follows:
If to Borrower: NORFOLK FIRST LLC
c/o First Potomac Realty Investment Trust, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Facsimile: (▇▇▇)▇▇▇-▇▇▇▇
and
JPMORGAN ▇▇▇▇▇ ▇▇▇▇
▇▇
▇/▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ Advisory Group, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
If to Trustee: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇
c/o Tri-State Commercial Closings, Inc.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
If to Lender: JPMorgan Chase Bank
c/o ▇.▇. ▇▇▇▇▇▇ Mortgage Capital, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: L. ▇▇▇▇▇▇ Register, Jr.
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to: ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
or addressed as such party may from time to time designate by written notice to
the other parties. For purpose of this subsection, the term "BUSINESS DAY" shall
mean a day on which commercial banks are not authorized or required by law to
close in New York, New York.
Any party by notice to the other parties may designate additional or
different addresses for subsequent notices or communications.
ARTICLE 15 - APPLICABLE LAW
Section 15.1 GOVERNING LAW; JURISDICTION. This Security Instrument
shall be governed by and construed in accordance with applicable federal law and
the laws of the Commonwealth of Virginia, without reference or giving effect to
any choice of law doctrine. Borrower hereby irrevocably submits to the
jurisdiction of any court of competent jurisdiction located in the Commonwealth
of Virginia in connection with any proceeding arising out of or relating to this
Security Instrument.
Section 15.2 USURY LAWS. This Security Instrument and the Note are
subject to the express condition that at no time shall Borrower be obligated or
required to pay interest on the Debt at a rate which could subject the holder of
the Note to either civil or criminal liability as a result of being in excess of
the maximum interest rate which Borrower is permitted by applicable law to
contract or agree to pay. If by the terms of this Security Instrument or the
Note, Borrower
JPMORGAN CHASE BANK
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is at any time required or obligated to pay interest on the Debt at a rate in
excess of such maximum rate, the rate of interest under the Security Instrument
and the Note shall be deemed to be immediately reduced to such maximum rate and
the interest payable shall be computed at such maximum rate and all prior
interest payments in excess of such maximum rate shall be applied and shall be
deemed to have been payments in reduction of the principal balance of the Note.
All sums paid or agreed to be paid to Lender for the use, forbearance, or
detention of the Debt shall, to the extent permitted by applicable law, be
amortized, prorated, allocated, and spread throughout the full stated term of
the Note until payment in full so that the rate or amount of interest on account
of the Debit does not exceed the maximum lawful rate of interest from time to
time in effect and applicable to the Debt for so long as the Debt is
outstanding.
Section 15.3 PROVISIONS SUBJECT TO APPLICABLE LAW. All rights, powers
and remedies provided in this Security Instrument 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 Security Instrument invalid, unenforceable or not entitled to be
recorded, registered or filed under the provisions of any applicable law. If any
term of this Security Instrument or any application thereof shall be invalid or
unenforceable, the remainder of this Security Instrument and any other
application of the term shall not be affected thereby.
ARTICLE 16 - SECONDARY MARKET
Section 16.1 TRANSFER OF LOAN. Lender may, at any time, sell, transfer
or assign the Note, this Security Instrument and the Other Loan Documents, and
any or all servicing rights with respect thereto, or grant participations
therein or issue mortgage pass-through certificates or other securities
evidencing a beneficial interest in a rated or unrated public offering or
private placement (the "SECURITIES"). Lender may forward to each purchaser,
transferee, assignee, servicer, participant, investor in such Securities or any
Rating Agency (as hereinafter defined) rating such Securities (collectively, the
"INVESTOR") and each prospective Investor, all documents and information which
Lender now has or may hereafter acquire relating to the Debt and to Borrower,
any Guarantor, any Indemnitor and the Property, whether furnished by Borrower,
any Guarantor, any Indemnitor or otherwise, as Lender determines necessary or
desirable. The term "RATING AGENCY" shall mean each statistical rating agency
that has assigned a rating to the Securities.
ARTICLE 17 - COSTS
Section 17.1 PERFORMANCE AT BORROWER'S EXPENSE. Borrower acknowledges
and confirms that Lender shall impose certain administrative processing and/or
commitment fees in connection with (a) the extension, renewal, modification,
amendment and termination (excluding the scheduled maturity of the Note) of its
loans, (b) the release or substitution of collateral therefore, or (c) obtaining
certain consents, waivers and approvals with respect to the Property (the
occurrence of any of the above shall be called an "EVENT"). Borrower hereby
acknowledges and agrees to pay, immediately, upon demand, all such fees (as the
same may be increased or decreased from time to time), and any additional fees
of a similar type or nature which may be imposed by Lender from time to time,
upon the occurrence of any Event.
JPMORGAN CHASE BANK
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Section 17.2 ATTORNEY'S FEES FOR ENFORCEMENT. (a) Borrower shall pay
all legal fees incurred by Lender in connection with (i) the preparation of the
Note, this Security Instrument and the Other Loan Documents and (ii) the items
set forth in Section 17.1 above, and (b) Borrower shall pay to Lender on demand
any and all expenses, including legal expenses and attorneys' fees, incurred or
paid by Lender in protecting its interest in the Property or Personal Property
and/or collecting any amount payable or in enforcing its rights hereunder with
respect to the Property or Personal Property, whether or not any legal
proceeding is commenced hereunder or thereunder and whether or not any default
or Event of Default shall have occurred and is continuing, together with
interest thereon at the Default Rate from the date of payment or incurring by
Lender until paid by Borrower.
ARTICLE 18 - DEFINITIONS
Section 18.1 GENERAL DEFINITIONS. Unless the context clearly indicates
a contrary intent or unless otherwise specifically provided herein, words used
in this Security Instrument may be used interchangeably in singular or plural
form and the word "BORROWER" shall mean "each Borrower and any subsequent owner
or owners of the Property or any part thereof or any interest therein," the word
"LENDER" shall mean "Lender and any subsequent holder of the Note," the word
"NOTE" shall mean "the Note and any other evidence of indebtedness secured by
this Security Instrument," the word "PERSON" shall include an individual,
corporation, partnership, trust, unincorporated association, government,
governmental authority, and any other entity, the word "PROPERTY" shall include
any portion of the Property and any interest therein, and the phrases
"ATTORNEYS' FEES," "LEGAL FEES" and "COUNSEL FEES" shall include any and all
attorneys', paralegal and law clerk fees and disbursements, including, but not
limited to, fees and disbursements at the pre-trial, trial and appellate levels
incurred or paid by Lender in protecting its interest in the Property, the
Leases and the Rents and enforcing its rights hereunder.
ARTICLE 19 - MISCELLANEOUS PROVISIONS
Section 19.1 NO ORAL CHANGE. This Security Instrument, the Note, and
the Other Loan Documents and any provisions hereof or thereof, may not be
modified, amended, waived, extended, changed, discharged or terminated orally or
by any act or failure to act on the part of Borrower or Lender, but only by an
agreement in writing signed by the party against whom enforcement of any
modification, amendment, waiver, extension, change, discharge or termination is
sought.
Section 19.2 LIABILITY. If Borrower consists of more than one person,
the obligations and liabilities of each such person hereunder shall be joint and
several. This Security Instrument shall be binding upon and inure to the benefit
of Borrower and Lender and their respective successors and assigns forever.
Section 19.3 INAPPLICABLE PROVISIONS. If any term, covenant or
condition of the Note or this Security Instrument is held to be invalid, illegal
or unenforceable in any respect, the Note and this Security Instrument shall be
construed without such provision.
JPMORGAN CHASE BANK
48
Section 19.4 HEADINGS, ETC. The headings and captions of various
Sections of this Security Instrument are for convenience of reference only and
are not to be construed as defining or limiting, in any way, the scope or intent
of the provisions hereof.
Section 19.5 DUPLICATE ORIGINALS; COUNTERPARTS. This Security
Instrument may be executed in any number of duplicate originals and each
duplicate original shall be deemed to be an original. This Security Instrument
may be executed in several counterparts, each of which counterparts shall be
deemed an original instrument and all of which together shall constitute a
single Security Instrument. The failure of any party hereto to execute this
Security Instrument, or any counterpart hereof, shall not relieve the other
signatories from their obligations hereunder.
Section 19.6 NUMBER AND GENDER. Whenever the context may require, any
pronouns used herein shall include the corresponding masculine, feminine or
neuter forms, and the singular form of nouns and pronouns shall include the
plural and vice versa.
Section 19.7 SUBROGATION. If any or all of the proceeds of the Note
have been used to extinguish, extend or renew any indebtedness heretofore
existing against the Property, then, to the extent of the funds so used, Lender
shall be subrogated to all of the rights, claims, liens, titles, and interests
existing against the Property heretofore held by, or in favor of, the holder of
such indebtedness and such former rights,liens,claims, titles, and interests, if
any, are not waived but rather are continued in full force and effect in favor
of Lender and are merged with the lien and security interest created herein as
cumulative security for the repayment of the Debt, the performance and discharge
of Borrower's obligations hereunder, under the Note and the Other Loan Documents
and the performance and discharge of the Other Obligations.
Section 19.8 ENTIRE AGREEMENT. The Note, this Security Instrument and
the Other Loan Documents constitute the entire understanding and agreement
between Borrower and Lender with respect to the transactions arising in
connection with the Debt and supersede all prior written or oral understandings
and agreements between Borrower and Lender with respect thereto. Borrower hereby
acknowledges that, except as incorporated in writing in the Note, this Security
Instrument and the Other Loan Documents, there are not, and were not, and no
persons are or were authorized by Lender to make, any representations,
understandings, stipulations, agreements or promises, oral or written, with
respect to the transaction which is the subject of the Note, this Security
Instrument and the Other Loan Documents.
Section 19.9 RELEASE. Upon payment of all sums secured by this
Instrument, Lender shall request Trustee to release this Instrument
and shall surrender all notes evidencing indebtedness secured by this Instrument
to Trustee. Trustee shall release this Instrument. Borrower shall pay Trustee's
reasonable costs incurred in releasing this Instrument.
At any time on or after the Payment Date (as defined in the Note)
occurring in May, 2004, Borrower may obtain the release from this Security
Instrument, the Assignment of Leases and Rents and the UCC Financing Statements
of the Property upon satisfaction of each of the following conditions precedent:
JPMORGAN CHASE BANK
49
For purposes hereof the term "DEBT COVERAGE RATIO" shall mean the ratio of Cash
Available for Debt Service (as defined below) to annual debt service (i.e.,
principal (if any) and interest payments) due under the Note after application
of the prepayment required by clause (ii) above (utilizing solely for purposes
of calculating the Debt Coverage Ratio an assumed interest rate equal to the
Interest Rate in effect on the date of determination of the Debt Coverage Ratio)
and any other notes secured by the Greenbrier Property or by direct pledges of
equity in the Borrower (but specifically excluding any notes not made by the
Borrower or secured by the Greenbrier Property or membership interests in the
Borrower). Cash Available for Debt Service, which is generally defined below,
shall be determined by Lender in a manner substantially the same as that
utilized by Lender in underwriting loans secured by similar property types at
the time of determination of the Debt Coverage Ratio. In addition, Cash
Available for Debt Services shall be adjusted by applying (i) vacancy and/or
credit loss rates to gross income at the higher of actual, market or the rate
applied by the Rating Agencies, (ii) rental or average daily room rates (as
applicable) at the lower of actual, market or the rate applied by the Rating
Agencies, (iii) deductions for operating expenses based on the higher of actual
historical levels, market or as otherwise applied by the Rating Agencies and
(iv) deducting expenses for capital replacements and repairs, tenant
improvements and leasing commissions, calculated at the greater of actual or
minimum amounts per square foot of the Greenbrier Property required by Lender
and/or the Rating Agencies for properties of similar types, location and
condition. Cash Available for Debt Service shall mean:
(iv) all gross receipts received or (with respect to a projected
Debt Coverage Ratio) anticipated from the Greenbrier Property,
including, without limitation, from tenants in the Greenbrier Property
and paying rent under leases in effect during the applicable
twelve-month period, calculated on a cash basis which reflects only the
income actually received during the previous twelve-month period as of
the date of such calculation, and for a projected Debt Coverage Ratio
any income anticipated to be received during the following twelve-month
period based on leases in effect as of the date of calculation, for
such time as those leases are contracted to remain in effect without
expiration by their terms or optional termination by the tenant (unless
the tenant has waived its termination rights in writing or the term
of the lease has been extended in writing), including without
limitation all amounts to be received from tenants as payment of
operating expenses but not including refundable deposits, late fees or
charges, interest income or other non-operating income, lease
termination payments, excess tenant improvement and leasing commission
payments included as additional rent, principal or interest payments
received by Borrower on loans to tenants and fees and reimbursements
for work performed for tenants by Borrower, less:
(v) all expenses actually incurred by Borrower (without
duplication), for the operation or maintenance of the Greenbrier
Property for the applicable twelve-month period, including ground
rents, the cost of property management (which shall be the greater of
the actual management fee payable under a management contract in effect
for the applicable twelve (12) month period, market or the minimum fee
applied by the Rating Agencies), marketing, franchise fees (which shall
be the greater of the actual fees payable under franchise or
JPMORGAN CHASE BANK
51
license agreements, market, or the minimum fee applied by
nationally recognized rating agencies), maintenance, cleaning,
security, legal, administrative, landscaping, parking
maintenance, utilities, real estate taxes and assessments and
other taxes related to the operation of the Greenbrier
Property, insurance premiums, necessary repairs and future
replacements of equipment and other capital expenditures,
tenant improvements, leasing commissions and other costs and
expenses incurred by Borrower during the applicable period,
and for a projected Debt Coverage Ratio, amounts reasonably
estimated by Lender for each of the foregoing items. Payments
under the Note and non-cash deductions for income tax purposes
shall not be deducted in determining Cash Available for Debt
Service.
ARTICLE 20-TRUSTEE
Trustee may resign by the giving of notice of such resignation in
writing or verbally to Lender. If Trustee shall die, resign, or become
disqualified from acting in the execution of this trust, or if, for any reason,
Lender shall prefer to appoint a substitute trustee or multiple substitute
trustees, or successive substitute trustees or successive multiple substitute
trustees, to act instead of the aforenamed Trustee, Lender shall have full power
to appoint a substitute trustee (or, if preferred, multiple substitute trustees)
in succession who shall succeed (and if multiple substitute trustees are
appointed, each of such multiple substitute trustees shall succeed) to all the
estates, rights, powers, and duties of the aforenamed Trustee. Such appointment
may be executed by any authorized agent of Lender, and if such Lender be a
corporation and such appointment be executed in its behalf by any officer of
such corporation, such appointment shall be conclusively presumed to be executed
with authority and shall be valid and sufficient without proof of any action by
the board of directors or any superior officer of the corporation. Borrower
hereby ratifies and confirms any and all acts which the aforenamed Trustee, or
his successor or successors in this trust, shall do lawfully by virtue hereof.
If multiple substitute Trustees are appointed, each of such multiple substitute
Trustees shall be empowered and authorized to act alone without the necessity of
the joinder of the other multiple substitute trustees, whenever any action or
undertaking of such substitute trustees is requested or required under or
pursuant to this Security Instrument or applicable law. Any substitute Trustee
appointed pursuant to any of the provisions hereof shall, without any further
act, deed or conveyance, become vested with all the estates, properties, rights,
powers, and trusts of its or his predecessor in the rights hereunder with like
effect as if originally named as Trustee herein; but nevertheless, upon the
written request of Lender or of the substitute Trustee, the Trustee ceasing to
act shall execute and deliver any instrument transferring to such substitute
Trustee, upon the trusts herein expressed, all the estates, properties, rights,
powers and trusts of the Trustee so ceasing to act and shall duly assign,
transfer and deliver any of the property and moneys held by such Trustee to the
substitute Trustee so appointed in the Trustee's place. No fees or expenses
shall be payable to Trustee, except in connection with a foreclosure of the
Property or any part thereof or in connection with the release of the Property
following payment in full of the Debt.
JPMORGAN CHASE BANK
52
ARTICLE 21-SPECIAL COMMONWEALTH OF VIRGINIA PROVISIONS
Section 21.1 Short Form Incorporation. The following short form
provisions are incorporated into this Deed of Trust and Security Agreement by
reference as permitted by Section 55-60 and Section 55-59.2 of the code of
Virginia as amended (the "CODE"):
(1) Exemptions waived.
(2) Subject to all upon default.
(3) Renewal, extension or reinstatement permitted.
(4) Substitution of trustee permitted.
(5) Any trustee may act.
(6) Advertisement required: Once a week for two weeks.
Section 21.2 Powers and Duties of Trustee. The Trustee shall have
all powers and duties granted and imposed under Code Sections 55-59 through
55-59.4, inclusive. Any trustee's sale hereunder shall be held, and all proceeds
thereof shall be distributed, in accordance with the provisions of Code Section
55-59.4.
Section 21.3 Commercial Loan. The Borrower warrants and represents
that the loan made by the Lender to the Borrower in accordance with the Note and
the other Loan Documents is made for the acquisition or conduct of a business or
investment within the meaning ascribed to those terms under 6.1-330.75 of the
code.
Section 21.4 Limitation on Recourse. Borrower's liability under
this Security Instrument shall be limited as set forth in Section 10 of the
Note, the terms of which are incorporated herein by reference.
[NO FURTHER TEXT ON THIS PAGE]
JPMORGAN CHASE BANK
53
IN WITNESS WHEREOF, THIS SECURITY INSTRUMENT has been executed by
Borrower the day and year first above written.
BORROWER:
NORFOLK FIRST LLC, a Delaware limited
liability company
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title : President
STATE OF MARYLAND
COUNTY OF ▇▇▇▇▇▇▇▇▇▇
Before me, a Notary Public in and for the jurisdiction aforesaid,
personally appeared this date ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, personally well known (or
satisfactorily proven) to me to be the person whose name is subscribed to the
foregoing and annexed Instrument bearing date as of October 16, 2002, who, being
by me first duly sworn, acknowledged that he is President of NORFOLK FIRST LLC,
a Delaware limited liability company, which entity is a party to the foregoing
and annexed Instrument and that he executed said Instrument in his capacity as
President of said entity, as its free act and deed for the uses and purposes
therein contained.
WITNESS my hand and official seal this 16th day of October, 2002.
/s/ ▇▇▇▇ Sannenberg
----------------------------
NOTARY PUBLIC
Print Name: ▇▇▇▇ Sannenberg
My Commission Expires: 12/1/02.
[Affix Notary Seal]
JPMORGAN CHASE BANK
53
EXHIBIT A
(Description of Land)
All of that certain lot, piece or parcel of land, with the buildings
and improvements thereon, situate, lying and being described as follows:
A-1
EXHIBIT A
File No. V02-4773 Policy No. SPECIMEN
ALL THAT CERTAIN LOT OR PARCEL OF LAND SITUATE AND LYING IN THE CITY OF NORFOLK,
VIRGINIA, AND MORE PARTICULARLY DESCRIBED AS FOLLOWS:
PARCEL 38, AS SHOWN ON THAT CERTAIN PLAT ENTITLED "PLAT OF PARCEL ▇▇, ▇▇▇▇▇ ▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, VIRGINIA", DATED DECEMBER 17, 1984, MADE BY
DIVISION OF SURVEYS, DEPARTMENT OF PUBLIC WORKS, NORFOLK, VIRGINIA, WHICH SAID
PLAT IS RECORDED IN THE CLERK'S OFFICE OF THE CIRCUIT COURT OF THE CITY OF
NORFOLK, VIRGINIA (THE "CLERK'S OFFICE"), IN MAP BOOK 41, PAGE 10.
TAX MAP NO. 1317-9816
AND BEING THE SAME PROPERTY CONVEYED TO NORFOLK FIRST LLC, A DELAWARE LIMITED
LIABILITY COMPANY, BY SPECIAL WARRANTY DEED FROM ▇▇ ▇▇▇▇▇▇▇ ROADS CORP., AN
ILLINOIS CORPORATION, DATED OCTOBER _ _, ▇▇▇▇ AND RECORDED _________________,
2002 IN DEED BOOK_________AT PAGE _______ IN THE CLERK'S OFFICE, CIRCUIT COURT,
CITY OF NORFOLK, VIRGINIA.
EXHIBIT B
(Greenbrier Parcel)
A-2
EXHIBIT B
File No. V02-4772 Policy No. SPECIMEN
ALL THAT CERTAIN LOT OR PARCEL OF LAND SITUATE AND LYING IN THE CITY OF
CHESAPEAKE, VIRGINIA, AND MORE PARTICULARLY DESCRIBED AS FOLLOWS:
PARCEL 45C-2 ON THAT CERTAIN PLAT ENTITLED "SUBDIVISION PLAT OF PARCEL 45C A
PORTION OF GREENBRIER - ZONE 2, SECTION J GREENBRIER INDUSTRIAL AND OFFICE PARK,
WASHINGTON BOROUGH - CHESAPEAKE, VA", DATED AUGUST 30, 1988, MADE BY ENGINEERING
SERVICES, INC., WHICH PLAT IS RECORDED IN THE CLERK'S ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ (THE "CLERK'S OFFICE"), IN MAP BOOK
92, PAGES 84 AND 84A.
TOGETHER WITH THE RIGHT TO USE IN COMMON WITH GREENBRIER TECHNOLOGY CENTER II
ASSOCIATES, L.P. AND ALL OTHER AUTHORIZED USERS, AND SUBJECT TO, ALL EASEMENTS,
PRIVILEGES, RIGHTS AND OBLIGATIONS BENEFITING THE ABOVE DESCRIBED PROPERTY, AS
GRANTED AND IMPOSED BY THAT CERTAIN DECLARATION OF EASEMENT AGREEMENT, BY AND
AMONG GREENBRIER TECHNOLOGY CENTER I ASSOCIATES AND DOMINION BANK OF GREATER
HAMPTON ROADS, N.A., DATED DECEMBER 30, 1986, AND RECORDED IN THE CLERK'S OFFICE
IN DEED BOOK 2255 AT PAGE 17.
TAX MAP NO.: 02 80000000651
AND BEING THE SAME PROPERTY CONVEYED TO GTC II FIRST LLC, A DELAWARE LIMITED
LIABILITY COMPANY, BY SPECIAL WARRANTY DEED FROM ▇▇ ▇▇▇▇▇▇▇ ROADS CORP., AN
ILLINOIS CORPORATION, DATED OCTOBER__, 2002 AND RECORDED ___________,2002 IN
DEED BOOK_______AT PAGE_____IN THE CLERK'S ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇.