Exhibit 10.4
After recording please return:
▇▇▇▇▇▇▇▇ & Worcester LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇'▇▇▇▇▇, Esq.
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MORTGAGE, SECURITY AGREEMENT,
ASSIGNMENT OF LEASES AND RENTS,
AND FIXTURE FILING
made by
MONTICELLO RACEWAY MANAGEMENT, INC.,
Mortgagor,
to
THE BANK OF SCOTLAND, as Agent
Mortgagee
THIS INSTRUMENT AFFECTS REAL AND PERSONAL PROPERTY SITUATED IN THE STATE OF NEW
YORK, COUNTY OF ▇▇▇▇▇▇▇▇, KNOW BY ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇ ▇▇. ▇▇▇▇▇ TRUST PARCEL
(232 ACRES MORE OR LESS) MONTICELLO, NEW YORK.
THIS MORTGAGE CONSTITUTES A FINANCING STATEMENT FILED AS A FIXTURE FILING, AND
IS TO BE FILED AND INDEXED IN THE REAL ESTATE RECORDS AND ALSO TO BE INDEXED IN
THE INDEX OF FINANCING STATEMENTS (FIXTURE FILINGS) UNDER THE NAMES OF
MORTGAGOR, AS "DEBTOR," AND MORTGAGEE, AS "SECURED PARTY." SEE GRANTING CLAUSES
AND SECTION 18 OF THIS INSTRUMENT FOR DESCRIPTION OF FIXTURES AND OTHER DETAILS.
THIS MORTGAGE DOES NOT COVER REAL PROPERTY PRINCIPALLY IMPROVED OR TO BE
IMPROVED BY ONE OR MORE STRUCTURES CONTAINING IN THE AGGREGATE NOT MORE THAN SIX
RESIDENTIAL DWELLING UNITS EACH HAVING THEIR OWN SEPARATE COOKING FACILITIES.
THE "MAXIMUM PRINCIPAL AMOUNT" SECURED BY THIS MORTGAGE IS $10,000,000 (SEE
SECTION 33 FOR THE MAXIMUM TOTAL AMOUNT THAT THIS MORTGAGE SECURES).
Dated as of January 11, 2005
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TABLE OF CONTENTS
Page
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Granting Clauses...............................................................1
Terms and Conditions...........................................................4
1. Warranty of Title.....................................................4
2. Payment of Obligations................................................4
3. Requirements..........................................................4
4. Payment of Taxes and Other Impositions................................5
5. Insurance.............................................................6
6. Restrictions on Liens and Encumbrances................................6
7. Due on Sale and Other Transfer Restrictions...........................6
8. Casualty Condemnation/Eminent Domain..................................6
9. Leases................................................................6
10. Further Assurances....................................................7
11. Mortgagee's Right to Perform..........................................7
12. Events of Default.....................................................7
13. Remedies..............................................................7
14. Right of Mortgagee to Credit Sale.....................................8
15. Appointment of Receiver...............................................8
16. Extension, Release, etc...............................................9
17. Security Agreement under Uniform Commercial Code.....................10
18. Future Advances......................................................10
19. Assignment of Rents..................................................11
20. Additional Rights....................................................11
21. Mortgagor's Indemnities..............................................12
22. No Liability of Mortgagee............................................12
23. Notices..............................................................12
24. No Oral Modification.................................................12
25. Partial Invalidity...................................................13
26. Mortgagor's Waiver of Rights.........................................13
27. Remedies Not Exclusive...............................................14
28. Multiple Security....................................................14
29. Successors and Assigns...............................................15
30. No Waivers, etc......................................................15
31. Governing Law, etc...................................................16
32. Certain Definitions..................................................16
33. Maximum Amount of Indebtedness.......................................16
34. Last Dollars Secured Priority........................................16
35. Release..............................................................16
36. Inconsistency with Loan Agreement....................................17
37. Loan Agreement.......................................................17
38. No Merger of Estates.................................................17
39. No Partnership.......................................................17
40. Limitation of Amount.................................................17
41. Future Assignments...................................................17
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TABLE OF CONTENTS
(continued)
Page
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42. Lien Law.............................................................17
43. Statutory Interpretation.............................................18
44. Power of Sale........................................................18
45. Multiple Parcels.....................................................18
46. Headings.............................................................18
47. Defense of Claims....................................................18
48. Exculpation Provisions...............................................19
49. Intentionally Deleted................................................19
50. Incorporation by Reference...........................................19
MORTGAGE, SECURITY AGREEMENT,
ASSIGNMENT OF LEASES AND RENTS, AND FIXTURE FILING
THIS MORTGAGE, SECURITY AGREEMENT, ASSIGNMENT OF LEASES AND RENTS, AND
FIXTURE FILING, dated as of January 11, 2005 is made by MONTICELLO RACEWAY
MANAGEMENT, INC., a New York corporation (the "MORTGAGOR"), with an address at
▇/▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇; ▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, to THE BANK OF
SCOTLAND, as Agent (in such capacity, the "MORTGAGEE"), with an address at ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attn.: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇. References to
this "Mortgage" shall mean this instrument .and any and all renewals,
modifications, amendments, supplements, extensions, consolidations,
substitutions, spreaders and replacements of this instrument.
BACKGROUND
A. Empire Resorts, Inc. ("EMPIRE") is a party to the Loan Agreement, dated
as of January 11, 2005 (as amended, supplemented or otherwise modified from time
to time, the "LOAN AGREEMENT"), among Empire, the Mortgagor and the other
Guarantors named therein (each, a "SUBSIDIARY GUARANTOR" and collectively
together with Empire, the "LOAN PARTIES"), certain lenders (the "BANKS") and THE
BANK OF SCOTLAND, as agent (in such capacity, the "AGENT") for the Banks.
B. Pursuant to the terms of the Loan Agreement, the Banks have agreed to
make available to Empire a $10,000,000 revolving credit facility, which will be
guaranteed on a senior basis, in part, by each of the Loan Parties. The terms of
the Loan Agreement are incorporated by reference in this Mortgage as if the
terms thereof were fully set forth herein. Capitalized terms not otherwise
defined herein shall have the meanings ascribed thereto in the Loan Agreement
and the other Loan Documents. References in this Mortgage to the "OVERDUE RATE"
shall mean a rate per annum equal to 2% in excess of the Base Rate.
C. The Mortgagor is the owner of the fee simple estate in the parcels of
real property described on EXHIBIT A attached hereto (the "OWNED LAND") and
owns, leases or otherwise has the right to use all of the buildings,
improvements, structures, and fixtures now or subsequently located on the Owned
Land (the "IMPROVEMENTS"; the Owned Land and the Improvements being collectively
referred to as the "REAL ESTATE").
D. As an inducement to the Agent and the Banks to enter into the Loan
Agreement and the Banks to make Loans, the Mortgagor is executing and delivering
this Mortgage to the Mortgagee. References herein to the "SECURED PARTIES" shall
mean the collective reference to the Mortgagee, the Agent, each Bank and any
other holder of the Obligations (as hereinafter defined), and their respective
successors, endorsees, transferees and assigns.
GRANTING CLAUSES
For good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the Mortgagor agrees that to secure the payment and
performance of all "Obligations" (as defined in the Loan Agreement) and other
liabilities of the Mortgagor and the Loan Parties which may arise under or in
connection with the Notes, the Loan Agreement and the other Loan Documents, in
each case whether on account of principal, interest, reimbursement obligations,
for fees, indemnities, costs, expenses or otherwise (including, without
limitation, all fees and disbursements of counsel to the Mortgagee or to any
Secured Party that are required to be paid by the Mortgagee pursuant to the
terms of this Mortgage or any other Loan Documents (collectively, the
"OBLIGATIONS");
THE MORTGAGOR HEREBY GRANTS TO THE MORTGAGEE A LIEN UPON AND A SECURITY INTEREST
IN, AND HEREBY MORTGAGES AND WARRANTS, GRANTS, ASSIGNS, TRANSFERS AND SETS OVER
UNTO THE MORTGAGEE FOR THE USE AND BENEFIT OF THE MORTGAGEE, AS AGENT:
(a) the Owned Land;
(b) all right, title and interest the Mortgagor now has or may
hereafter acquire in and to the Improvements or any part thereof
(whether owned in fee by the Mortgagor or held pursuant to any Lease
or otherwise) and all the estate, right, title, claim or demand
whatsoever of the Mortgagor, in possession or expectancy, in and to
the Real Estate or any part thereof;
(c) all right, title and interest of the Mortgagor in, to and
under all easements, rights of way, licenses, operating agreements,
abutting strips and gores of land, streets, ways, alleys, passages,
sewer rights, waters, water courses, water and flowage rights,
development rights, air rights, mineral and soil rights, plants,
standing and fallen timber, and all estates, rights, titles,
interests, privileges, licenses, tenements, hereditaments and
appurtenances belonging, relating or appertaining to the Real Estate,
and any reversions, remainders, rents, issues, profits and revenue
thereof and all land lying in the bed of any street, road or avenue,
in front of or adjoining the Real Estate to the center line thereof;
(d) all of the fixtures, chattels, business machines, machinery,
apparatus, equipment, furnishings, fittings, appliances and articles
of personal property of every kind and nature whatsoever, and all
appurtenances and additions thereto and substitutions or replacements
thereof (together with, in each case, attachments, components, parts
and accessories) currently owned or subsequently acquired by the
Mortgagor and now or subsequently attached to, or contained in or used
or usable in any way in connection with any operation or letting of
the Real Estate, including but without limiting the generality of the
foregoing, all screens, awnings, shades, blinds, curtains, draperies,
artwork, carpets, rugs, storm doors and windows, furniture and
furnishings, heating, electrical, and mechanical equipment, lighting,
switchboards, plumbing, ventilating, air conditioning and air-cooling
apparatus, refrigerating, and incinerating equipment, escalators,
elevators, loading and unloading equipment and systems, stoves,
ranges, laundry equipment, cleaning systems (including window cleaning
apparatus), telephones, communication systems (including satellite
dishes and antennae), televisions; computers, sprinkler systems and
other fire prevention and extinguishing apparatus and materials,
security systems, motors, engines, machinery, pipes, pumps, tanks,
conduits, appliances, fittings and fixtures of every kind and
description (all of the foregoing in this paragraph (d) being referred
to as the "EQUIPMENT");
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(e) all right, title and interest of the Mortgagor in and to all
substitutes and replacements of, and all additions and improvements
to, the Real Estate and the Equipment, subsequently acquired by or
released to the Mortgagor or constructed, assembled or placed by the
Mortgagor on the Real Estate; immediately upon such acquisition,
release, construction, assembling or placement, including, without
limitation, any and all building materials whether stored at the Real
Estate or offsite, and, in each such case, without any further deed,
conveyance, assignment or other act by the Mortgagor;
(f) all right, title and interest of the Mortgagor in, to and
under all leases, subleases, underlettings, concession agreements,
management agreements, licenses and other agreements relating to the
use or occupancy of the Real Estate or the Equipment or any part
thereof, now existing or subsequently entered into by the Mortgagor
and whether written or oral and all guarantees of any of the foregoing
(collectively, as any of the foregoing may be amended, restated,
extended, renewed or modified from time to time, the "LEASES"); and
all rights of the Mortgagor in respect of cash and securities
deposited thereunder and the right to receive and collect the
revenues, income, rents, issues and profits thereof, together with all
other rents, royalties, issues, profits, revenue, income and other
benefits arising from the use and enjoyment of the Mortgaged Property
(as defined below) (collectively, the "RENTS");
(g) all unearned premiums under insurance policies now or
subsequently obtained by the Mortgagor relating to the Real Estate or
Equipment, and the Mortgagor's interest in and to all proceeds of any
such insurance policies (including title insurance policies) including
the right to collect and receive such proceeds, subject to the
provisions relating to insurance generally set forth below; and all
awards and other compensation, including the interest payable thereon
and the right to collect and receive the same; made to the present or
any subsequent owner of the Real Estate or Equipment for the taking by
eminent domain, condemnation or otherwise, of all or any part of the
Real Estate or any easement or other right therein; .
(h) to the extent not expressly prohibited under the applicable
contract, consent, license or other item unless the appropriate
consent has been obtained, all right, title and interest of the
Mortgagor in and to (i) all contracts from time to time executed by
the Mortgagor or any manager or agent on its behalf relating to the
ownership, construction, maintenance, repair, operation, occupancy,
sale or financing of the Real Estate or Equipment or any part thereof
and all agreements and options relating to the purchase or lease of
any portion of the Real Estate, together with the right to exercise
such options and all leases of Equipment, (ii) all consents, licenses,
building permits, certificates of occupancy and other governmental
approvals relating to construction, completion, occupancy, use or
operation of the Real Estate or any part thereof, and (iii) all
drawings, plans, specifications and similar or related items relating
to the Real Estate; and
(i) all proceeds, both cash and noncash, of the foregoing;
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(All of the foregoing property and rights and interests now owned or
held or subsequently acquired by the Mortgagor and described in the foregoing
clauses (a) through (c) are collectively referred to as the "PREMISES", and
those described in the foregoing clauses (a) through (i) are collectively
referred to as the "MORTGAGED PROPERTY").
TO HAVE AND TO HOLD the Mortgaged Property and the rights and
privileges hereby mortgaged unto the Mortgagee, its successors and assigns for
the uses and purposes set forth, until the Obligations are paid in full and the
Loan Commitments terminated under the Loan Agreement; PROVIDED HOWEVER, that the
condition of this Mortgage is such that if the Obligations are so discharged,
then the estate hereby granted shall cease, terminate and become void, but shall
otherwise remain in full force and effect. Notwithstanding anything to the
contrary contained herein, the Lien of this Mortgage shall be released in
compliance with the terms of the Loan Agreement.
This Mortgage covers advances, in the aggregate amount of the
obligations secured hereby, made by the Secured Parties for the benefit of the
Mortgagor.
TERMS AND CONDITIONS
The Mortgagor further represents, warrants, covenants and agrees with
the Mortgagee and the Secured Parties as follows:
1. WARRANTY OF TITLE. The Mortgagor warrants that it has good and
marketable record title in fee simple to the Real Estate, and good title to the
rest of the Mortgaged Property, subject only to the matters that are set forth
in Schedule B of the title insurance policy or policies being issued to the
Mortgagee to insure the lien of this Mortgage and any other Permitted Liens (as
defined in the Loan Agreement). The Mortgagor shall warrant, defend and preserve
such title and the lien of this Mortgage against all claims of all persons and
entities (not including the holders of the Permitted Liens). The Mortgagor
represents and warrants that it has the power and lawful authority to grant,
bargain, sell, assign, transfer, mortgage and convey a mortgage lien and
security interest in all of the Mortgaged Property to the Mortgagee in the
manner and form herein provided and without obtaining the authorization,
approval, consent or waiver of any grantor, lessor, sublessor, governmental
authority or other Person whomsoever.
2. PAYMENT OF OBLIGATIONS. The Mortgagor shall pay and perform the
Obligations at the times and places and in the manner specified in the Loan
Agreement and the other Loan Documents.
3. REQUIREMENTS. The Mortgagor shall promptly comply with all laws,
ordinances, judgments, decrees, injunctions, writs and orders of any court,
arbitrator or governmental agency or authority, and all rules, regulations,
orders, interpretations, directives, licenses and permits, applicable to the
Mortgaged Property, and all covenants, restrictions and conditions now or later
of record which may be applicable to any of the Mortgaged Property, or to the
use, manner of use, occupancy, possession, operation, maintenance, alteration,
repair or reconstruction of any of the Mortgaged Property. The Mortgagor shall
not commit, nor permit or suffer to occur, any material waste with respect to
the Mortgaged Property.
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4. PAYMENT OF TAXES AND OTHER IMPOSITIONS. (a) Promptly when due or prior
to the date on which any fine, penalty, interest or cost may be added thereto of
imposed, the Mortgagor shall pay and discharge all taxes, charges and
assessments of every kind and nature, all charges for any easement or agreement
maintained for the benefit of any of the Real Estate, all general and special
assessments, levies, permits, inspection and license fees, all water and sewer
rents and charges, vault taxes and all other public charges even if unforeseen
or extraordinary, imposed upon or assessed against or which may become a lien on
any of the Real Estate, or arising in respect of the occupancy, use or
possession thereof, together with any penalties or interest on any of the
foregoing (all of the foregoing are collectively referred to herein as the
"IMPOSITIONS"), except where (i) the validity or amount thereof is being
contested in good faith by appropriate proceedings, which the Mortgagee
determines suspends the obligation to pay the Imposition and that non-payment
thereof will not result in forfeiture, sale, loss or diminution of any interest
of the Mortgagee in the Mortgaged Property and (ii) the Mortgagor has set aside
on its books adequate reserves with respect thereto in accordance with GAAP,
which reserves shall include reasonable additional sums to cover possible
interest, costs, and penalties; PROVIDED, HOWEVER, that the Mortgagor shall
promptly cause to be paid any amount adjudged by a court of competent
jurisdiction to be due, with all interest, costs and penalties thereon, promptly
after such judgment becomes final (and, subject to the Mortgagee's rights and
remedies during an Event of Default and subject to any provisions set forth in
the Loan Agreement and the other Loan Documents to the contrary, the Mortgagee
shall make any sum deposited in such reserve available for such payment); and
provided, further, that, in all events, Impositions, interest costs and
penalties shall be paid prior to the date any writ or order is issued under
which the Mortgaged Property may be sold, lost or forfeited. Upon request by the
Mortgagee, the Mortgagor shall deliver to the Mortgagee evidence reasonably
acceptable to the Mortgagee showing the payment of any such Imposition. If by
law any Imposition, at the Mortgagor's option, may without penalty or premium be
paid in installments (whether or not interest shall accrue on the unpaid balance
of such Imposition), the Mortgagor may elect to pay such Imposition in such
installments and shall be responsible for the payment of such installments with
interest, if any.
(b) Nothing herein shall affect any right or remedy of the Mortgagee
under this Mortgage or otherwise, without notice or demand to the Mortgagor, to
pay any Imposition after the date such Imposition shall have become due, and add
to the Obligations the amount so paid, together with interest from the time of
payment at the Overdue Rate. Any sums paid by the Mortgagee in discharge of any
Impositions shall be (i) a lien on the Premises secured hereby prior to any
right or title to, interest in, or claim upon the Premises subordinate to the
lien of this Mortgage, and (ii) payable on demand by the Mortgagor to the
Mortgagee together with interest at the Overdue Rate as set forth above.
(c) As of the date hereof, the Mortgagor represents and warrants that
the Mortgagor (i) has filed all federal, state, commonwealth, county, municipal
and city income and other material tax returns required to have been filed by it
and has paid all taxes and other impositions which have become due or pursuant
to any assessments or charges received by it, (ii) does not know of any basis
for any additional assessment or charge in respect of any such taxes or other
Impositions, and (iii) has paid in full all sums owing or claimed for labor,
material, supplies, personal property (whether or not forming an Improvement
hereunder) and services of every kind and character used, furnished or installed
in or on the Mortgaged Property that are now due and owing and no claim for same
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exists or will be permitted to be created, except such claims as may arise in
the ordinary course of business and that are not yet past due.
5. INSURANCE. (a) The Mortgagor promptly shall comply with and conform in
all material respects to (i) all provisions of each insurance policy maintained
with respect to the Mortgaged Property, and (ii) all requirements of the
insurers applicable to the Mortgagor or to any of the Mortgaged Property or to
the use, manner of use, occupancy, possession, operation, maintenance,
alteration or repair of any of the Mortgaged Property. The Mortgagor shall not
use or permit the use of the Mortgaged Property in any manner which would permit
any insurer to cancel any insurance policy or void coverage required to be
maintained by this Mortgage.
(b) In the event of foreclosure of this Mortgage or other transfer of
title to the Mortgaged Property, all right, title and interest of the Mortgagor
in and to any insurance policies then in force shall pass to the purchaser or
grantee.
6. RESTRICTIONS ON LIENS AND ENCUMBRANCES. Except for the Permitted Liens,
the Mortgagor shall not further mortgage, nor otherwise encumber the Mortgaged
Property nor create or suffer to exist any lien, charge or encumbrance on the
Mortgaged Property, or any part thereof, whether superior or subordinate to the
lien of this Mortgage and whether recourse or non-recourse.
7. DUE ON SALE AND OTHER TRANSFER RESTRICTIONS. Except as expressly
permitted in the Loan Agreement and the other Loan Documents, the Mortgagor
shall not sell, transfer, convey or assign all or any portion of, or any
interest in, the Mortgaged Property.
8. CASUALTY CONDEMNATION/EMINENT DOMAIN. Immediately upon obtaining
knowledge of any casualty or the institution of any proceedings for the
condemnation of the Mortgaged Property, or any material portion thereof, the
Mortgagor will notify the Mortgagee of the pendency of such proceedings. In all
events, the Mortgagor hereby covenants and agrees to promptly commence and to
diligently prosecute the restoration of the Mortgaged Property upon the
occurrence of any casualty loss affecting the Mortgaged Property, without regard
to the availability of any proceeds or award. Notwithstanding any damage to
destruction or loss of or other casualty with respect to any of the Mortgaged
Property, the Mortgagor shall continue to pay the Obligations at the time and in
the manner provided for in the Loan Agreement and the other Loan Documents,
until the Obligations have been paid in full. If the Mortgaged Property is sold,
through foreclosure or otherwise, prior to the receipt by the Mortgagee of such
insurance proceeds, the Mortgagee shall have the right, whether or not a
deficiency judgment on any Loan Document shall have been sought, recovered or
denied, to receive such insurance proceeds, or a portion thereof sufficient to
pay the then unpaid Obligations, whichever is less.
9. LEASES. Except as expressly permitted under the Loan Agreement, the
Mortgagor shall not (a) execute an assignment or pledge of any Lease relating to
all of any portion of the Mortgaged Property other than in favor of the
Mortgagee, (b) execute or permit to exist any Lease of any of the Mortgaged
Property, or (c) mortgage, pledge, assign, hypothecate, amend, modify, or
otherwise encumber or transfer any Lease or any interest in any Lease.
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10. FURTHER ASSURANCES. To further assure the Mortgagee's rights under this
Mortgage, the Mortgagor agrees promptly upon demand of the Mortgagee to do any
act or execute and deliver, record and/or file any additional documents
(including, but not limited to, security agreements on any personalty included
or to be included in the Mortgaged Property and a separate assignment of each
Lease in recordable form) as may be reasonably required by the Mortgagee to
confirm the lien of this Mortgage and all other rights or benefits conferred on
the Mortgagee by this Mortgage.
11. MORTGAGEE'S RIGHT TO PERFORM. If an Event of Default has occurred and
is continuing, the Mortgagee, without waiving or releasing the Mortgagor from
any obligation or default under this Mortgage, may, pay or perform the same, and
the amount or cost thereof, with interest at the Overdue Rate, shall immediately
upon written demand be due from the Mortgagor to the Mortgagee and the same
shall be secured by this Mortgage and shall be a lien on the Mortgaged Property
prior to, any right, title to, interest in, or claim upon the Mortgaged Property
attaching subsequent to the lien of this Mortgage. No payment or advance of
money by the Mortgagee under this Section shall be deemed or construed to cure
the Mortgagor's default or waive any right or remedy of the Mortgagee.
12. EVENTS OF DEFAULT. The occurrence of an Event of Default under the Loan
Agreement shall constitute an Event of Default hereunder. Notwithstanding the
foregoing, the breach by the Mortgagor of any term or provision of this Mortgage
other than those terms requiring the making of any payment shall not constitute
an Event of Default hereunder unless such breach, if susceptible of cure, has
not been cured within thirty (30) days after the earlier of the date on which
the Mortgagee gives the Mortgagor notice of such breach or the date an officer
of any Loan Party becomes aware thereof.
13. REMEDIES. (a) Upon the occurrence and during the continuance of any
Event of Default, the Mortgagee may immediately take such action, without notice
or demand, under the Loan Agreement and the other Loan Documents and otherwise
as it deems advisable to protect and enforce its rights against the Mortgagor
and in and to the Mortgaged Property, including, but not limited to, the
following actions, each of which may be pursued concurrently or otherwise, at
such time and in such manner as the Mortgagee may determine, in its sole
discretion, without impairing or otherwise affecting the other rights and
remedies of the Mortgagee:
(i) The Mortgagee may, to the extent permitted by applicable law,
(A) institute and maintain an action of mortgage foreclosure against
all or any part of the Mortgaged Property, (B) institute and maintain
an action on the Loan Agreement or any other Loan Document, or (C)
take such other action at law or in equity for the enforcement of this
Mortgage or any of the Loan Agreement and the other Loan Documents as
the law may allow. The Mortgagee may proceed in any such action to
final judgment and execution thereon for all sums due hereunder,
together with interest thereon at the Overdue Rate and all costs of
suit, including, without limitation, reasonable attorneys' fees and
disbursements. Interest at the Overdue Rate shall be due on any
judgment obtained by the Mortgagee from the date of judgment until
actual payment is made of the full amount of the judgment; and
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(ii) The Mortgagee may personally, or by its agents, attorneys
and employees and without regard to the adequacy or inadequacy of the
Mortgaged Property or any other collateral as security for the
Obligations enter into and upon the Mortgaged Property and each and
every part thereof and exclude the Mortgagor and its agents and
employees therefrom without liability for trespass, damage or
otherwise (the Mortgagor hereby agreeing to surrender possession of
the Mortgaged Property to the Mortgagee upon demand at any such time)
and use, operate, manage, maintain and control the Mortgaged Property
and every part thereof. Following such entry and taking of possession,
the Mortgagee shall be entitled, without limitation, (A) to lease all
or any part or parts of the Mortgaged Property for such periods of
time and upon such conditions as the Mortgagee may, in its discretion,
deem, proper, (B) to enforce, cancel or modify any Lease and (C)
generally to execute, do and perform any other act, deed; matter or
thing concerning the Mortgaged Property as the Mortgagee shall deem
appropriate as fully as the Mortgagor might do.
(b) In case of a foreclosure sale, the Real Estate may be sold, at the
Mortgagee's election, in one parcel or in more than one parcel and the Mortgagee
is specifically empowered (without being required to do so, and in its sole and
absolute discretion) to cause successive sales of portions of the Mortgaged
Property to be held.
(c) In the event of any breach of any of the covenants, agreements,
terms or conditions contained in this Mortgage, the Mortgagee shall be entitled
to enjoin such breach and obtain specific performance of any covenant,
agreement, term or condition and the Mortgagee shall have the right to invoke
any equitable right or remedy as though other remedies were not provided for in
this Mortgage.
(d) It is agreed that if an Event of Default shall occur and be
continuing, any and all proceeds of the Mortgaged Property received by the
Mortgagee shall be held by the Mortgagee for the benefit of the Secured Parties
as collateral security for the Obligations (whether matured or unmatured), and
shall be applied in payment of the Obligations in the manner set forth in the
Loan Agreement.
14. RIGHT OF MORTGAGEE TO CREDIT SALE. Upon the occurrence of any sale made
under this Mortgage, by virtue of judicial proceedings or of a judgment or
decree of foreclosure and sale, the Mortgagee may bid for and acquire the
Mortgaged Property or any part thereof. In lieu of paying cash therefor, the
Mortgagee may make settlement for the purchase price by crediting upon the
Obligations or other sums secured by this Mortgage, the net sales price after
deducting therefrom the expenses of sale and the cost of the action and any
other sums which the Mortgagee is authorized to deduct under this Mortgage. In
such event, this Mortgage, the Loan Agreement and the other Loan Documents
evidencing expenditures secured hereby may be presented to the person or persons
conducting the sale in order that the amount so used or applied may be credited
upon the Obligations as having been paid.
15. APPOINTMENT OF RECEIVER. If an Event of Default shall have occurred and
be continuing, the Mortgagee as a matter of right and without notice to the
Mortgagor, unless otherwise required by applicable law, and without regard to
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the adequacy or inadequacy of the Mortgaged Property or any other collateral or
the interest of the Mortgagor therein as security for the Obligations, shall
have the right to apply to any court having jurisdiction to appoint a receiver
or receivers or other manager of the Mortgaged Property, without requiring the
posting of a surety bond, and without reference to the adequacy or inadequacy of
the value of the Mortgaged Property or the solvency or insolvency of the
Mortgagor or any other party obligated for payment of all or any part of the
Obligations, and whether or not waste has occurred with respect to the Mortgaged
Property, and the Mortgagor hereby irrevocably consents to such appointment and
waives notice of any application therefor (except as may be required by law).
Any such receiver or receivers or manager stall have all the usual powers and
duties of receivers in like or similar cases and all the powers and duties of
the Mortgagee in case of entry as provided in this Mortgage, including, without
limitation and to the extent permitted by law, the right to enter into leases of
all or any part of the Mortgaged Property, and shall continue as such and
exercise all such powers until the date of confirmation of sale of the Mortgaged
Property unless such receivership is sooner terminated.
16. EXTENSION, RELEASE, ETC. (a) Without affecting the lien or charge of
this Mortgage upon any portion of the Mortgaged Property not then or theretofore
released as security for the full amount of the Obligations, the Mortgagee may,
from time to time and without notice, agree to (i) release any person liable for
the indebtedness borrowed or guaranteed under the Loan Agreement and the other
Loan Documents, (ii) extend the maturity or alter any of the terms of the
indebtedness borrowed or guaranteed under the Loan Agreement and the other Loan
Documents or any other guaranty thereof, (iii) grant other indulgences, (iv)
release or reconvey, or cause to be released or reconveyed at any time at the
Mortgagee's option any parcel, portion or all of the Mortgaged Property, (v)
take or release any other or additional security for any obligation herein
mentioned, or (vi) make compositions or other arrangements with debtors in
relation thereto.
(b) No recovery of any judgment by the Mortgagee and no levy of an
execution under any judgment upon the Mortgaged Property or upon any other
property of the Mortgagor shall affect the lien of this Mortgage or any liens,
rights, powers or remedies of the Mortgagee hereunder, and such liens, rights,
powers and remedies shall continue unimpaired.
(c) If the Mortgagee shall have the right to foreclose this Mortgage
or to direct a power of sale, the Mortgagor authorizes the Mortgagee at its
option to foreclose the lien of this Mortgage (or direct the sale of the
Mortgaged Property, as the case may be) subject to the rights of any tenants of
the Mortgaged Property. The failure to make any such tenants parties defendant
to any such foreclosure proceeding and to foreclose their rights, or to provide
notice to such tenants as required in any statutory procedure governing a sale
of the Mortgaged Property, or to terminate such tenant's rights in such sale
will not be asserted by the Mortgagor as a defense to any proceeding instituted
by the Mortgagee to collect the Obligations or to foreclose the lien of this
Mortgage.
(d) Unless expressly provided otherwise, in the event that ownership
of this Mortgage and title to the Mortgaged Property or any estate therein shall
become vested in the same person or entity; this Mortgage shall not merge in
such title but shall continue as a valid lien on the Mortgaged Property for the
amount secured hereby.
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17. SECURITY AGREEMENT UNDER UNIFORM COMMERCIAL CODE. (a) It is the
intention of the parties hereto that this Mortgage shall constitute a Security
Agreement within the meaning of the UCC (as defined in the Uniform Commercial
Code of the State of New York (the "UCC"). If an Event of Default shall occur
and be continuing under this Mortgage, then in addition to having any other
right or remedy available at law or in equity, the Mortgagee shall have the
option of either (i) proceeding under the Code and exercising such rights and
remedies as may be provided to a secured party by the Code with respect to all
or any portion of the Mortgaged Property which is personal property (including,
without limitation, taking possession of and selling such property) or (ii)
treating such property as real property and proceeding with respect to both the
real and personal property constituting the Mortgaged Property in accordance
with the Mortgagee's rights, powers and remedies with respect to the real
property (in which event the default provisions of the Code shall not apply). If
the Mortgagee shall elect to proceed under the Code, then ten days' notice of
sale of the personal property shall be deemed reasonable notice and the
reasonable expenses of retaking, holding, preparing for sale, selling and the
like incurred by the Mortgagee shall include, but not be limited, to, reasonable
attorneys' fees and legal expenses. At the Mortgagee's request, the Mortgagor
shall assemble the personal property and make it available to the Mortgagee at a
place designated by the Mortgagee which is reasonably convenient to both
parties.
(b) The Mortgagor and the Mortgagee agree, to the extent permitted by
law, that: (i) all of the goods described within the definition of the word
"Equipment" are or are to become fixtures on the Real Estate; (ii) this Mortgage
upon recording or registration in the real estate records of the proper office
shall constitute a financing statement filed as a "fixture filing" within the
meaning of Sections 9a-334 and 9a-502 of the Code; (iii) the Mortgagor is the
record owner of the Owned Land; and (iv) the addresses of the Mortgagor and the
Mortgagee are as set forth on the first page of this Mortgage.
(c) The information provided in this paragraph is provided in, order
that this Mortgage shall comply with the requirements of applicable law for a
mortgage instrument to be filed as a financing statement. The Mortgagor is the
"Debtor" and its name and mailing address are set forth hereinabove. The
"Secured Party" is the Mortgagee and its name and mailing address from which
information concerning the security interest granted herein may be obtained are
as set forth hereinabove. A statement describing the portion of the Mortgaged
Property comprising of goods or other personal property that may now be or
hereafter become fixtures hereby secured is set forth in the description of the
Mortgaged Property contained herein. The Mortgagor is the record owner of the
Mortgaged Property.
(d) After written request, Mortgagor shall file all financing
statements necessary to perfect the Mortgagee's lien thereon. Additionally,
Mortgagor authorizes Mortgagee to file financing statements describing the
Mortgaged Property on the Mortgagors behalf; provided that the Mortgagee shall
not be responsible for the filing of any financing or continuation statement.
18. FUTURE ADVANCES. The lien of this Mortgage with respect to any future
advances and/or obligations up to a maximum of $10,000,000, modifications,
extensions, and renewals referred to herein and made from time to time shall
have the same priority to which this Mortgage otherwise would be entitled as of
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the date this Mortgage is executed and recorded without regard to the fact that
any such future advance, obligation, modification, extension, or renewal may
occur after this Mortgage is executed.
19. ASSIGNMENT OF RENTS. (a) The Mortgagor hereby assigns to the Mortgagee
the Rents as further security for the payment of and performance of the
Obligations, and the Mortgagor grants to the Mortgagee the right to enter the
Mortgaged Property for the purpose of collecting the same and to let the
Mortgaged Property or any part thereof, and to apply the Rents on account of the
Obligations. The foregoing assignment and grant is present, irrevocable and
absolute and shall continue in effect until the Obligations are fully paid and
performed, but the Mortgagee hereby grants the Mortgagor a revocable license to
collect, receive, use and retain the Rents until the occurrence of an Event of
Default; such license to collect, receive, use and retain the Rents shall be
immediately and automatically revoked by the Mortgagee without the necessity of
any action of the Mortgagee upon the occurrence and during the continuance of
any Event of Default; in the event such license is revoked, the Mortgagor shall
pay over to the Mortgagee, or to any receiver appointed to collect the Rents,
any lease security deposits, and shall pay monthly in advance to the Mortgagee,
or to any such receiver, the fair and reasonable rental value as determined by
the Mortgagee for the use and occupancy of such part of the Mortgaged Property
as may be in the possession of the Mortgagor or any affiliate of the Mortgagor,
and upon default in any such payment the Mortgagor and any such affiliate will
vacate and surrender the possession of the Mortgaged Property to the Mortgagee
or to such receiver, and in default thereof may be evicted by summary
proceedings or otherwise. The Mortgagor shall not accept prepayments of
installments of Rent to become due for a period of more than one month in
advance (except for security deposits and estimated payments of percentage rent,
if any).
(b) The Mortgagor has not affirmatively done any act which would
prevent the Mortgagee from, or limit the Mortgagee in, acting under any of the
provisions of the foregoing assignment.
(c) Except for any matter disclosed in the Loan Agreement and the
other Loan Documents, no action has been brought or, so far as is known to the
Mortgagor, is threatened, which would interfere in any way with the right of the
Mortgagor to execute the foregoing assignment and perform all of the Mortgagor's
obligations contained in this Section and in the Leases.
20. ADDITIONAL RIGHTS. The holder of any subordinate lien or subordinate
mortgage on the Mortgaged Property shall have no right to terminate any Lease
whether or not such Lease is subordinate to this Mortgage nor shall the
Mortgagor consent to any holder of any subordinate lien or subordinate mortgage
joining any tenant under any Lease in any action to foreclose the lien or
modify, interfere with, disturb or terminate the rights of any tenant under any
Lease. By recordation of this Mortgage all subordinate lienholders and the
mortgagees and beneficiaries under subordinate mortgages are subject to and
notified of this provision, and any action taken by any such penholder or
beneficiary contrary to this provision shall be null and void. Upon the
occurrence and during the continuance of any Event of Default, the Mortgagee
may, in its sole discretion and without regard to the adequacy of its security
under this Mortgage, apply all or any part of any amounts on deposit with the
Mortgagee under this Mortgage against all or any part of the Obligations. Any
such application shall not be construed to cure or waive any Default or Event of
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Default or invalidate any act taken by the Mortgagee on account of such Default
or Event of Default.
21. MORTGAGOR'S INDEMNITIES. The Mortgagor agrees to protect, indemnify and
hold harmless the Mortgagee and each Secured Party (collectively, the
"INDEMNITEES") from and against any and all losses which the Mortgagee or any
such Indemnitee may incur under or by reason of the assignment of Leases and
Rents, or for any action taken by the Mortgagee or any Bank or Indemnitee
hereunder, or by reason or in defense of any and all claims and demands
whatsoever which may be asserted against the Mortgagee or any such Indemnitee
arising out of the Leases, including, without limitation, any claim by any third
Person for credit on account of Rents paid to and received by the Mortgagor, but
not delivered to the Mortgagee or its agents, representatives or employees, for
any period under any Lease more than one (1) month in advance of the due date
thereof. In the event that the Mortgagee or any of the Secured Parties incurs
any losses covered by the indemnity set forth in this Section, the amount
thereof, including reasonable attorneys' fees, with interest thereon at the
Overdue Rate, shall be payable by the Mortgagor to the Mortgagee within ten (10)
days after demand therefor, and shall be secured hereby and by all other
security for the payment and performance of the Obligations, including, without
limitation, the lien and security interest of this Mortgage. The liabilities of
the Mortgagor as set forth in this Section shall survive the termination of this
Mortgage and the repayment of the Obligations.
22. NO LIABILITY OF MORTGAGEE. Neither the acceptance nor the exercise of
the rights and remedies hereunder nor any other action on the part of Mortgagee
or any Person exercising Mortgagee's rights hereunder shall be construed to: (a)
be an assumption by Mortgagee or any such Person or to otherwise make Mortgagee
or such Person liable or responsible for the performance of any of the
obligations of Mortgagor under or with respect to the Leases or for any Rent,
security deposit or other amount delivered to Mortgagor, provided that Mortgagee
or any such Person exercising the rights of Mortgagee shall be accountable for
any Rents, security deposits or other amounts actually received by Mortgagee or
such Person, as the case may be; or (b) obligate Mortgagee or any such Person to
take any action under or with respect to the Leases or with respect to the
Mortgaged Property, to incur any expense or perform or discharge any duty or
obligation under or with respect to the Leases or with respect to the Mortgaged
Property, to appear in or defend any action or proceeding relating to the Leases
or the Mortgaged Property, to constitute Mortgagee as a mortgagee-in-possession
(unless Mortgagee actually enters and takes possession of the Mortgaged
Property), or to be liable in any way for any injury or damage to Persons or
property sustained by any Person in or about the Mortgaged Property, other than
to the extent caused by the willful misconduct or gross negligence of Mortgagee
or any Person exercising the rights of Mortgagee hereunder.
23. NOTICES. All notices, requests, demands and other communications
hereunder shall be given in accordance with the provisions of the Loan Agreement
and the other Loan Documents to the Mortgagor and to the Mortgagee as specified
therein.
24. NO ORAL MODIFICATION. This Mortgage may not be amended, supplemented or
otherwise modified except in accordance with the provisions of the Loan
Agreement and the other Loan Documents. Any agreement made by the Mortgagor and
the Mortgagee after the date of this Mortgage relating to this Mortgage shall be
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superior to the rights of the holder of any intervening or subordinate lien or
encumbrance.
25. PARTIAL INVALIDITY. In the event any one or more of the provisions
contained in this Mortgage shall for any reason be held to be invalid, illegal
or unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provision hereof, but each shall be construed as if
such invalid, illegal or unenforceable provision had never been included.
Notwithstanding to the contrary anything contained in this Mortgage or in any
provisions of any Loan Document, the obligations of the Mortgagor and of any
other obligor under any Loan Agreement and the other Loan Documents shall be
subject to the limitation that the Mortgagee shall not charge, take or receive,
nor shall the Mortgagor or any other obligor be obligated to pay to the
Mortgagee, any amounts constituting interest in excess of the maximum rate
permitted by law to be charged by the Mortgagee.
26. MORTGAGOR'S WAIVER OF RIGHTS. (a) The Mortgagor hereby voluntarily and
knowingly releases and waives any and all rights to retain possession of the
Mortgaged Property after the occurrence of an Event of Default hereunder and any
and all rights of redemption from sale under any order or decree of foreclosure
(whether full or partial), pursuant to rights, if any, therein granted, as
allowed under any applicable law, on its own behalf, on behalf of all persons
claiming or having an interest (direct or indirectly) by, through or under each
constituent of the Mortgagor and on behalf of each and every person acquiring
any interest in the Mortgaged Property subsequent to the date hereof, it being
the intent hereof that any and all such rights or redemption` of each
constituent of the Mortgagor and all such other persons are and shall be deemed
to be hereby waived to the fullest extent permitted by applicable law or
replacement statute. Each constituent of the Mortgagor shall not invoke or
utilize any such law or laws or otherwise hinder, delay, or impede the execution
of any right, power, or remedy herein or otherwise granted or delegated to the
Mortgagee, but shall permit the execution of every such right, power, and remedy
as though no such law or laws had been made or enacted.
(b) To the fullest extent permitted by law, the Mortgagor waives the
benefit of all laws now existing or that may subsequently be enacted providing
for (i) any appraisement before sale of any portion of the Mortgaged Property,
(ii) any extension of the time for the enforcement of the collection of the
Obligations or the creation or extension of a period of redemption from any sale
made in collecting such debt and (iii) exemption of the Mortgaged Property from
attachment, levy or sale under execution or exemption from civil process to the
full extent the Mortgagor may do so, the Mortgagor agrees that the Mortgagor
will not at any time insist upon, plead, claim or take the benefit or advantage
of any law now or hereafter in force providing for any appraisement, valuation,
stay, exemption, extension or redemption, or requiring foreclosure of this
Mortgage before exercising any other remedy granted hereunder and the Mortgagor,
for the Mortgagor and its successors and assigns, and for any and all persons
ever claiming any interest in the Mortgaged Property, to the extent permitted by
law, hereby waives and releases all rights of redemption, valuation,
appraisement, stay of execution, notice of election to mature (except as
expressly provided in the Loan Agreement and the other Loan Documents) or
declare due the whole of the secured indebtedness and marshalling in the event
of exercise by the Mortgagee of the foreclosure rights, power of sale, or other
rights hereby created.
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27. REMEDIES NOT EXCLUSIVE. The Mortgagee shall be entitled to enforce
payment and performance of the Obligations and to exercise all rights and powers
under this Mortgage or under any of the other Loan Agreement and the other Loan
Documents or other agreement or any laws now or hereafter in force,
notwithstanding some or all of the Obligations may now or hereafter be otherwise
secured, whether by deed of trust, mortgage, security agreement, pledge, lien,
assignment or otherwise. Neither the acceptance of this Mortgage nor its
enforcement, shall prejudice or in any manner affect the Mortgagee's rights to
realize upon or enforce any other security now or hereafter held by the
Mortgagee, it being agreed that the Mortgagee shall be entitled to enforce this
Mortgage and any other security now or hereafter held by the Mortgagee in such
order and manner as the Mortgagee may determine in its absolute discretion. No
remedy herein conferred upon or reserved to the Mortgagee is intended to be
exclusive of any other remedy herein or by law provided or permitted, but each
shall be cumulative and shall be in addition to every other remedy given
hereunder or now or hereafter existing at law or in equity or by statute. Every
power or remedy given by any of the Loan Agreement and the other Loan Documents
to the Mortgagee or to which either may otherwise be entitled, may be exercised,
concurrently or independently, from time to time and as often as may be deemed
expedient by the Mortgagee, as the case may be. In no event shall the Mortgagee,
in the exercise of the remedies provided in this Mortgage (including, without
limitation, in connection with the assignment of Rents to the Mortgagee, or the
appointment of a receiver and the entry of such receiver on to all or any part
of the Mortgaged Property), be deemed a "mortgagee in possession," and the
Mortgagee shall not in any way be made liable for any act, either of commission
or omission, in connection with the exercise of such remedies.
28. MULTIPLE SECURITY. If (a) the Premises shall consist of one or more
parcels, whether or not contiguous and whether or not located in the same
county, or (b) in addition to this Mortgage, the Mortgagee shall now or
hereafter hold or be the beneficiary of one or more additional mortgages, liens,
deeds of trust or other security (directly or indirectly) for the Obligations
upon other property in the State in which the Premises are located (whether or
not such property is owned by the Mortgagor or by others) or (c) both the
circumstances described in clauses (a) and (b) shall be true, then to the
fullest extent permitted by law, the Mortgagee may, at its election, commence or
consolidate in a single foreclosure action all foreclosure proceedings against
all such collateral securing the Obligations (including the Mortgaged Property),
which action may be brought or consolidated in the courts of or sale conducted
in, any county in which any of such collateral is located. The Mortgagor
acknowledges that the right to maintain a consolidated foreclosure action is a
specific inducement to the Mortgagee to extend the indebtedness borrowed
pursuant to or guaranteed by the Loan Agreement and the other Loan Documents,
and the Mortgagor expressly and irrevocably waives any objections to the
commencement or consolidation of the foreclosure proceedings in a single action
and any objections to the laying of venue or based on the grounds of forum non
conveniens which it may now or hereafter have. The Mortgagor further agrees that
if the Mortgagee shall be prosecuting one or more foreclosure or other
proceedings against a portion of the Mortgaged Property or against any
collateral other than the Mortgaged Property, which collateral directly or
indirectly secures the Obligations, or if the Mortgagee shall have obtained a
judgment of foreclosure and sale or similar judgment against such collateral,
then, whether or not such proceedings are being maintained or judgments were
obtained in or outside the State in which the Premises are located, the
Mortgagee may commence or continue any foreclosure proceedings and exercise its
other remedies granted in this Mortgage against all or any part of the Mortgaged
Property and the Mortgagor waives any objections to the commencement or
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continuation of a foreclosure of this Mortgage or exercise of any other remedies
hereunder based on such other proceedings or judgments, and waives any right to
seek to dismiss, stay, remove, transfer or consolidate either any action under
this Mortgage or such other proceedings on such basis. Neither the commencement
nor continuation of proceedings to foreclose this Mortgage, nor the exercise of
any other rights hereunder nor the recovery of any judgment by the Mortgagee in
any such proceedings or the occurrence of any sale in any such proceedings shall
prejudice, limit or preclude the Mortgagee's right to commence or continue one
or more foreclosure or other proceedings or obtain a judgment against any other
collateral (either in or outside the State in which the Premises are located)
which directly or indirectly secures the Obligations, and the Mortgagor
expressly waives any objections to the commencement of, continuation of, or
entry of a judgment in such other sales or proceedings or exercise of any
remedies in such sales or proceedings based upon any action or judgment
connected to this Mortgage, and the Mortgagor also waives any right to seek to
dismiss, stay, remove, transfer or consolidate either such other sales or
proceedings or any sale or action under this Mortgage on such basis. It is
expressly understood and agreed that to the fullest extent permitted by law, the
Mortgagee may, at its election, cause the sale of all collateral which is the
subject of a single foreclosure action at either a single sale or at multiple
sales conducted simultaneously and take such other measures as are appropriate
in order to effect the agreement of the parties to dispose of and administer all
collateral securing the Obligations (directly or indirectly) in the most
economical and least time-consuming manner.
29. SUCCESSORS AND ASSIGNS. All covenants of the Mortgagor contained in
this Mortgage are imposed solely and exclusively for the benefit of the
Mortgagee, and its successors and assigns, and no other person or entity shall
have standing to require compliance with such covenants or be deemed, under any
circumstances, to be a beneficiary of such covenants, any or all of which may be
freely waived in whole or in part by the Mortgagee at any time if in the sole
discretion of Mortgagee such a waiver is deemed advisable. All such covenants of
the Mortgagor shall run with the land and bind the Mortgagor, the successors and
assigns of the Mortgagor (and each of them) and all subsequent owners,
encumbrances and tenants of the Mortgaged Property, and shall inure to the
benefit of the Mortgagee and its successors and assigns. The word "Mortgagor"
shall be construed as if it read "Mortgagors" whenever the sense of this
Mortgage so requires and if there shall be more than one Mortgagor, the
obligations of the Mortgagors shall be joint and several.
30. NO WAIVERS, ETC. Any failure by the Mortgagee to insist upon the strict
performance by the Mortgagor of any of the terms and provisions of this Mortgage
shall not be deemed to be a waiver of any of the terries and provisions hereof,
and the Mortgagee, notwithstanding any such failure, shall have the right
thereafter to insist upon the strict performance by the Mortgagor of any and all
of the terms and provisions of this Mortgage to be performed by the Mortgagor.
The Mortgagee may release, regardless of consideration and without the necessity
for any notice to or consent by the holder of any subordinate lien on the
Mortgaged Property, any part of the security held for the obligations secured by
this Mortgage without, as to the remainder of the security, in any way impairing
or affecting the lien of this Mortgage or the priority of such lien over any
subordinate lien or deed of trust.
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31. GOVERNING LAW, ETC. This Mortgage shall be governed by and construed
and interpreted in accordance with the laws of the State of New York.
32. CERTAIN DEFINITIONS. Unless the context clearly indicates a contrary
intent or unless otherwise specifically provided herein, words used in this
Mortgage shall be used interchangeably in singular or plural form and the word
"Mortgagor" shall mean "each Mortgagor or any subsequent owner or owners of the
Mortgaged Property or any part thereof or interest therein," the word
"Mortgagee" shall mean "Mortgagee or any successor agent for the Secured
Parties," the word "person" shall include any individual, corporation,
partnership, limited liability company, trust, unincorporated association,
government, governmental authority, or other entity, and the words "Mortgaged
Property" shall include any portion of the Mortgaged Property or interest
therein. 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. The captions
in this Mortgage are for convenience or reference only and in no way limit or
amplify the provisions hereof.
33. MAXIMUM AMOUNT OF INDEBTEDNESS. Notwithstanding anything to the
contrary in this Mortgage, the maximum aggregate principal amount of
indebtedness that is, or under any contingency may be, secured by this Mortgage,
either at execution or any time thereafter (the "SECURED AMOUNT"), is
$10,000,000.00, plus amounts that Mortgagee expends under this Mortgage to the
extent that any such amounts shall constitute payment of (i) taxes, charges or
assessments that may be imposed by law upon the Mortgaged Property, (ii)
premiums on insurance policies covering the Mortgaged Property; (iii) expenses
incurred in upholding the lien of this Mortgage, including the expenses of any
litigation to prosecute or defend the rights and lien created by this Mortgage;
or (iv) any amount, cost or charge to which Mortgagee becomes subrogated, upon
payment; whether under recognized principles of law or equity, or under express
statutory authority; THEN, and in each such event, such amounts or costs,
together with interest thereon, shall be added to the indebtedness secured
hereby and shall be secured by this Mortgage.
34. LAST DOLLARS SECURED PRIORITY. This Mortgage secures only a portion of
the indebtedness owing or which may become owing by the Mortgagor to the Secured
Parties. The parties agree that any payments or repayments of such indebtedness
shall be and be deemed to be applied first to the portion of the indebtedness
that is not secured hereby, it being the parties' intent that the portion of the
indebtedness last remaining unpaid shall be secured hereby. If at any time this
Mortgage shall secure less than all of the principal amount of the Obligations,
it is expressly agreed that any repayments of the principal amount of the
Obligations shall not reduce the amount of the lien of this Mortgage until the
lien amount shall equal the principal amount of the Obligations outstanding.
35. RELEASE. If any of the Mortgaged Property shall be sold, transferred or
otherwise disposed of by any Mortgagor in a transaction permitted by, and in
accordance with, the Loan Agreement and the other Loan Documents, then the
Mortgagee, at the request and sole expense of such Mortgagor, shall execute and
deliver to such Mortgagor all releases or other documents reasonably necessary
or desirable for the release of the Liens created hereby on such Mortgaged
Property. The Mortgagor shall deliver to the Mortgagee, at least ten (10)
Business Days prior to the date of the proposed release, a written request for
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release identifying the sale or other disposition in reasonable detail,
including the price thereof and any expenses in connection therewith, together
with a certification by the Mortgagor stating that such transaction is in
compliance with, and permitted by, the Loan Agreement and the other Loan
Documents.
36. INCONSISTENCY WITH LOAN AGREEMENT. In the event of any conflict between
the terms of this Mortgage and the terms of the Loan Agreement and/or the other
Loan Documents, the terms of the Loan Agreement shall govern and control.
37. LOAN AGREEMENT. Mortgagor has received a copy of and is fully Loan
Agreement and the other Loan Documents. All representations and warranties made
by Mortgagor in the Loan Agreement and the other Loan Documents are incorporated
herein by reference and are hereby made by Mortgagor as to itself and the
Mortgaged Property as though such representations and warranties were set forth
at length herein as the representations and warranties of Mortgagor.
38. NO MERGER OF ESTATES. So long as any part of the Obligations remain
unpaid, unperformed or undercharged, the fee, easement and leasehold estates to
the Mortgaged Property shall not merge but rather shall remain separate and
distinct, notwithstanding the union of such estates either in the Mortgagor, the
Mortgagee, any lessee, any third-party purchaser or otherwise.
39. NO PARTNERSHIP. Nothing contained in this Mortgage is intended to, or
shall be construed to, create to any extent and in any manner whatsoever any
partnership, joint venture, or association between the Mortgagor and the
Mortgagee, or in any way make the Mortgagee a co-principal with the Mortgagor
with reference to the Mortgaged Property, and any inferences to the contrary are
hereby expressly negated.
40. LIMITATION OF AMOUNT. Notwithstanding the foregoing, the maximum
principal amount of indebtedness that may be secured by this Mortgage is the
Maximum Principal Amount as set forth on the cover of this Mortgage, and the
maximum total amount that may be secured by this Mortgage is limited as set
forth in SECTION 33.
41. FUTURE ASSIGNMENTS. If Mortgagor obtains mortgage financing secured by
the Mortgaged Property and the proceeds of such new mortgage financing are
applied to repay the Obligations in full, then in place of delivering a
discharge, satisfaction; or release of this Mortgage, the Mortgagee shall at
Mortgagor's request, deliver to the new lender an assignment of this Mortgage,
all in form reasonably satisfactory to Mortgagee. Effective upon Mortgagee's
assignment of this Mortgage, the Mortgagee shall be released from any remaining
obligations and liabilities under the Loan Agreement and other Loan Documents.
42. LIEN LAW. This Mortgage is made subject to the trust fund provisions of
Section 13 of the New York Lien Law. Mortgagor covenants that it shall receive
all monies and advances secured by this Mortgage and shall hold the right to
receive such advances as a trust fund to be applied first for the purpose of
paying the cost of improvement before using any part of the same for any other
purpose.
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43. STATUTORY INTERPRETATION. The covenants and conditions in this Mortgage
shall be construed as affording to Mortgagee rights additional to, and not
exclusive of, the rights conferred under the provisions of New York Real
Property Law Sections 254,271 and 272; provided Mortgagor shall have received
ten (10) business days' notice required under the Loan Agreement. The following
provisions of New York Real Property Law Section 254 shall, however, not apply
to this Mortgage and the rights and obligations of the parties to this Mortgage:
(1) subsection "4," covering the use and application of casualty or flood
insurance proceeds; and (2) the portion of subsection "4-a" that begins with the
word "however" and continues to the end of the paragraph. Any inconsistency
between this Mortgage and Real Property Law Section 254, 271 or 272 shall be
resolved in favor of this Mortgage.
44. POWER OF SALE. If an Event of Default has occurred and is continuing,
then without limiting any other rights or remedies of Mortgagee, Mortgagee may,
either with or without entry or taking possession of the Mortgaged Property as
provided in this Mortgage or otherwise, personally or by its agents or
attorneys, and without prejudice to the right to bring an action for foreclosure
of this Mortgage, sell the Mortgaged Property or any part of it pursuant to any
procedures provided by applicable law, including the procedures set forth in New
York Real Property Actions and Proceedings Law Article 14 (and any amendments or
substitute statutes in regard thereto), and all estate, right, title, interest,
claim, and demand therein, and right of redemption thereof, at one or more sales
as an entirety, or in parcels, and at such time and place upon such terms and
after such notice thereof as may be required or permitted by applicable law.
45. MULTIPLE PARCELS. If the Mortgaged Property consists of multiple
parcels, then in any sale of the Mortgaged Property pursuant to Mortgagee's
exercise of its remedies after an Event of Default (including any judicial
foreclosure sale under Real Property Actions and Proceedings Law Article 14),
the multiple parcels shall be sold at one time and in a single sale, except to
the extent that Mortgagee, in its sole absolute discretion, determines to sell
any one or more of the parcel(s) separately. Any such separate sales may be made
in whatever order Mortgagee determines in its sole and absolute discretion.
Mortgagee may, in its sole and absolute discretion,, cause the entire Mortgaged
Property to be offered for sale as a single auction lot and may also cause bids
to be solicited for individual parcels of the Mortgaged Property as separate
auction lots in any order, but shall be under no obligation to proceed in either
manner or the other. Mortgagor acknowledges that if Mortgagee sells multiple
parcels individually, no fair value or deficiency hearing shall be required
after each sale.
46. HEADINGS. The Section headings herein are inserted for convenience of
reference only and shall in no way alter, modify or define, or be used in
construing, the text of such Sections.
47. DEFENSE OF CLAIMS. The Mortgagor shall promptly notify the Mortgagee in
writing of the commencement of any legal proceedings affecting the Mortgagor's
title to the Mortgaged Property or the Mortgagee's Lien on or security interest
in the Mortgaged Property, or any part thereof, and shall take all such action,
employing attorneys agreeable to the Mortgagee, as may be necessary to preserve
the Mortgagor's and the Mortgagee's rights affected thereby. If the Mortgagor
fails or refuses to adequately or vigorously, in the sole judgment of the
Mortgagee, defend the Mortgagor's or the Mortgagee's rights to the Mortgaged
Property, the Mortgagee may take such action on behalf of and in the name of the
Mortgagor and at the Mortgagor's expense. All costs, expenses and reasonable
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attorneys' fees incurred by the Mortgagee (or its agents) pursuant to this
Section or in connection with the defense by the Mortgagee of any claims,
demands or litigation relating to the Mortgagor, the Mortgaged Property or the
transactions contemplated in this Mortgage shall be paid by the Mortgagor upon
written demand, plus interest thereon from the date of the advance by the
Mortgagee until reimbursement of the Mortgagee at the Overdue Rate.
48. EXCULPATION PROVISIONS. EACH OF THE PARTIES HERETO SPECIFICALLY AGREES
THAT IT HAS A DUTY TO READ THIS MORTGAGE; AND AGREES THAT IT IS CHARGED WITH
NOTICE AND KNOWLEDGE OF THE TERMS OF THIS MORTGAGE; THAT IT HAS IN FACT READ
THIS MORTGAGE AND IS FULLY INFORMED AND HAS FULL NOTICE AND KNOWLEDGE OF THE
TERMS, CONDITIONS AND EFFECTS OF THIS MORTGAGE; THAT IT HAS BEEN REPRESENTED BY
INDEPENDENT LEGAL COUNSEL OF ITS CHOICE THROUGHOUT THE NEGOTIATIONS PRECEDING
ITS EXECUTION OF THIS MORTGAGE AND HAS RECEIVED THE ADVICE OF ITS ATTORNEY IN
ENTERING INTO THIS MORTGAGE.
49. INTENTIONALLY DELETED.
50. INCORPORATION BY REFERENCE. In connection with its appointment and
acting hereunder, Mortgagee is entitled to all rights, privileges, benefits,
protections, immunities and indemnities provided to it as "Agent" under the Loan
Agreement.
[No Further Text, On This Page; Signature Page Follows.]
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IN WITNESS WHEREOF, this Mortgage has been duly executed by Mortgagor and
its corporate seal has been duly affixed hereto.
MONTICELLO RACEWAY
MANAGEMENT, INC., a New York
corporation
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇
Title: President
This Mortgage Was Prepared By
And When Recorded Return to:
▇▇▇▇▇▇▇▇ & Worcester LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇'▇▇▇▇▇, Esq.
-▇▇-
▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇ )
): ss.
COUNTY OF ▇▇▇▇▇▇▇▇ )
On the 1Oth day of January, in the year 2005, before me, the undersigned,
personally appeared ▇▇▇ ▇▇▇, personally known to me or proved to me on the basis
of satisfactory evidence to be the individual whose name is subscribed to the
within instrument and acknowledged to me that he executed the same in his
capacity, and that by his signature on the instrument, the individual, or the
person upon behalf of which the individual acted, executed the instrument.
Witness My Hand and Official Seal.
/s/ ▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------------
Signature
My Commission expires on June 2, 2007
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