MORTGAGE MODIFICATION, RESTATEMENT AND SECURITY AGREEMENT
from
1290 PARTNERS, L.P.
and
237 PARK PARTNERS, L.P.,
Mortgagors
to
THE CHASE MANHATTAN BANK,
AS AGENT,
Mortgagee
Dated as of October 10, 1996
After recording, please return to:
Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
ATTN: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
Block: 1300
Lots: 6 and 14
Section:
1290 Avenue of the Americas
New York, New York
Block: 1267
Lot: 1
Section:
MORTGAGE MODIFICATION, RESTATEMENT
AND SECURITY AGREEMENT
THIS MORTGAGE MODIFICATION, RESTATEMENT AND SECURITY AGREEMENT (herein,
together with all amendments and supplements thereto, called this "Mortgage"),
dated as of the 10th day of October, 1996, made by 1290 PARTNERS, L.P., a
Delaware limited partnership ("1290 Mortgagor"), and 237 PARK PARTNERS, L.P., a
Delaware limited partnership ("237 Park Mortgagor"; 1290 Mortgagor and 237 Park
Mortgagor collectively, "Mortgagors" and each individually, a "Mortgagor"), each
having an address at c/o ▇▇▇▇▇▇ Capital Group, L.P., ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇, to THE CHASE MANHATTAN BANK, in its capacity as Agent for the
Lenders (as defined the Credit Agreement (as hereinafter defined))
("Mortgagee"), having an address at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇-▇▇▇▇.
W I T N E S S E T H :
WHEREAS, the 1290 Mortgagor is the owner of the fee simple interest in the
land described in Exhibit A-1 attached hereto and made a part hereof (the "1290
Land") and the Improvements (as hereinafter defined) located thereon and the 237
Park Mortgagor is the owner of the fee simple interest in the land described in
Exhibit A-2 attached hereto and made a part hereof, (the "237 Park Land") and
the Improvements located thereon. The 1290 Land and the 237 Park Land shall be
collectively referred to herein as the "Land";
WHEREAS, Mortgagee has agreed to make a loan (the "Loan") to Mortgagors
pursuant to the Credit Agreement, dated as of even date herewith, between
Mortgagors, Mortgagee and the other Lenders (the "Credit Agreement"), in the
aggregate principal amount of Four Hundred Twenty Million ($420,000,000) Dollars
(the "Loan Amount");
WHEREAS, Mortgagors are the present holders of the makers' interest under
those certain promissory notes (collectively, the "Existing Notes") as more
particularly described on Exhibit B attached hereto and made a part hereof in
the aggregate unpaid principal amount as of the date hereof of $420,000,000;
WHEREAS, the Existing Notes are secured by those certain mortgages
(collectively, the "Existing Mortgages") as more particularly described on
Exhibit C attached hereto and made a part hereof, encumbering the Land and
recorded on the dates and in the county land records as set forth in said
Exhibit C;
WHEREAS, immediately prior to the execution and delivery hereof, Bankers
Trust Company, as Indenture Trustee ("Prior Lender") was the holder of the
lender's interest under all of the Existing Mortgages and the Existing Notes,
and pursuant to that certain Assignment, dated as of the date hereof, between
the Prior Lender, as assignor, and Mortgagee, as assignee, immediately prior to
the execution and delivery hereof, the Prior Lender assigned all of its right,
title and interest in and to the Existing Mortgages and the Existing Notes to
Mortgagee;
WHEREAS, on the date hereof, Mortgagors and Mortgagee have agreed (1) to
combine, consolidate and amend and restate in its entirety the indebtedness
evidenced by the Existing Notes and all of such indebtedness as so combined,
consolidated, amended and restated shall constitute a single indebtedness in the
aggregate original principal amount of Four Hundred Twenty Million Dollars
($420,000,000) pursuant to a certain Amended, Restated and Consolidated
Promissory Note (the "Consolidated Note"), (2) that the Existing Mortgages and
the liens thereof constitute in law but one mortgage, a single, first lien
securing the obligations evidenced by the Consolidated Note and (3) to amend and
restate the terms and conditions contained in the Existing Mortgages as
hereinafter set forth;
WHEREAS, Mortgagors and Mortgagee desire to sever and divide the
indebtedness evidenced by the Consolidated Note so that the indebtedness shall
be evidenced by certain separate promissory notes (collectively, the "Notes"),
made by Mortgagors to Mortgagee and the other Lenders; and
WHEREAS, the indebtedness evidenced by the Notes shall be secured by this
Mortgage and the other Loan Documents (as defined in the Credit Agreement).
NOW, THEREFORE, in consideration of the premis- es and for other good and
valuable consideration, the re-
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ceipt and sufficiency of which are hereby acknowledged,
Mortgagors hereby agree as follows:
I. The Existing Mortgages and the liens thereof, shall hereafter constitute
in law a valid and enforceable first lien in the amount of $420,000,000 upon the
Mortgaged Property (as hereinafter defined) securing the Indebtedness, together
with interest thereon, the Breakage Indebtedness (as hereinafter defined) and
all other sums secured thereby, and the Borrower shall pay the Indebtedness and
interest thereon at the rate of interest and on the terms provided for the
payment of principal and interest with respect to the Notes secured by this
Mortgage.
II. The Existing Mortgages and the liens thereof are hereby modified so
that all of the terms and conditions of the aforesaid mortgages shall be
restated in their entirety to be on the terms and conditions set forth herein,
and each Mortgagor agrees to comply with and be subject to all of the terms,
covenants and conditions of this Mortgage.
III. The parties hereto certify that this instrument secures the same
indebtedness evidenced by the Existing Notes and secured by the Existing
Mortgages, respectively, and secures no further or other indebtedness or
obligation. Neither this Mortgage nor anything contained herein shall be
construed as a substitution or novation of the Mortgagors' indebtedness to
Mortgagee or of the Existing Mortgages, which shall remain in full force and
effect as hereby confirmed, modified, restated and superseded.
IV. This Mortgage shall be binding upon and inure to the benefit of the
parties hereto, and their respective successors and assigns, and shall be deemed
to be effective as of the date hereof.
V. The Existing Mortgages, as modified and restated in their entirety
pursuant to this Mortgage, and the obligations of Mortgagors hereunder, are
hereby ratified and confirmed, and shall remain in full force and effect until
the full performance and satisfaction of all obligations of Mortgagors
thereunder.
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VI. Any reference to the Mortgage in the Notes, the Credit Agreement or any
other Loan Document shall be deemed to refer to this Mortgage.
TO SECURE:
(i) payment and performance of all covenants, conditions, liabilities
and obligations contained in, and payment of the indebtedness evidenced by,
the Notes plus all interest and additional amounts payable thereunder; and
(ii) payment and performance of all covenants, conditions, liabilities
and obligations of Mortgagors to Mortgagee and the other lenders contained
in this Mortgage, the Credit Agreement and any extensions, renewals or
modifications hereof; and
(iii) payment and performance of all covenants, conditions,
liabilities and obligations contained in each of the other Loan Documents;
and
(iv) without limiting the generality of the foregoing, payment of all
indebtedness, liabilities, and amounts from time to time evidenced by the
Notes, and all other indebtedness and liabilities, direct or indirect, of
Mortgagors to Mortgagee, due or to become due hereunder, or under any other
Loan Document (including, without limitation, any protective advances,
disbursements, payments and reimbursements made, and charges, expenses and
costs (including, without limitation, any enforcement and collection costs)
incurred by Mortgagee pursuant to the Notes, this Mortgage, or such other
Loan Documents) to protect the security intended to be provided hereby even
if the aggregate amount of indebtedness outstanding at any one time exceeds
the face amount of the Notes (all of the foregoing indebtedness, monetary
liabilities and obligations set forth in clauses (i)-(iv) above,
collectively, the "Note Indebtedness"; and payment of the Note Indebtedness
together with the performance of all covenants, conditions and obligations
set forth in clauses (i)(iv) above, collectively, the "Note Obligations");
and
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(v) payment of all costs incurred by the Counterparty (as hereinafter
defined) under the Swap Agreement (as defined in the Credit Agreement) in
connection with a Termination Event or an Event of Default thereunder (as
such terms are defined in the Swap Agreement) (all of the foregoing
indebtedness, monetary liabilities and obligations set forth in this clause
(v), collectively, the "Breakage Indebtedness"; the Note Indebtedness and
the Breakage Indebtedness collectively, the "Indebtedness"; and payment of
the Breakage Indebtedness together with the performance of all covenants,
conditions and obligations set forth in this clause (v) above,
collectively, the "Breakage Obligations"; the Note Obligations and the
Breakage Obligations collectively, the "Obligations").
NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS MORTGAGE, THE
MAXIMUM AMOUNT OF PRINCIPAL INDEBTEDNESS SECURED BY THIS MORTGAGE AT EXECUTION
OR UNDER ANY CONTINGENCY, WHICH MAY BE SECURED HEREBY AT ANY TIME HEREAFTER IS
$420,000,000.
GRANTING CLAUSES
NOW, THEREFORE, THIS MORTGAGE WITNESSETH: that Mortgagors, in consideration
of the premises, and other good and valuable consideration, the receipt and
suffi- ciency of which is hereby acknowledged (a) have mort- gaged, warranted,
granted, bargained, sold, conveyed, pledged, and assigned and (b) by these
presents do hereby mortgage, warrant, grant a security interest in, grant,
bargain, sell, convey, pledge, and assign unto Mortgagee and its successors and
assigns forever, in the trusts created hereby all of Mortgagors' estate, right,
title and interest now owned or hereafter acquired in, to and under any and all
of the property (herein called the "Mortgaged Property") described in the
following Granting Clauses:
I. The Land, together with the entire right, title and interest of
Mortgagors in and to such Land, subject to Permitted Liens (as hereinafter
defined) together with (a) all right, title and interest of Mortgagors in and to
all buildings, structures and other improvements now standing, or at any time
hereafter constructed or placed, upon the Land, including all of Mortgagors'
right, title and interest in and to all
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equipment and fixtures of every kind and nature on the Land or in any such
buildings, structures or other improvements (such buildings, structures, other
improvements, equipment and fixtures being herein collectively called the
"Improvements"), (b) all right, title and interest of Mortgagors in and to all
and singular tenements, hereditaments, easements, rights of way, rights,
privileges and appurtenances in and to the Land belonging or in any way
appertaining thereto, including without limitation all right, title and interest
of Mortgagors in, to and under any streets, ways, alleys, vaults, gores or
strips of land adjoining the Land and (c) all claims or demands of Mortgagors,
in law or in equity, in possession or expectancy of, in and to the Land together
with rents, income, revenues, issues and profits from and in respect of the
property described above in this Granting Clause I and the present and
continuing right to make claim for, collect, receive and receipt for the same as
hereinafter provided. It is the intention of the parties hereto that, so far as
may be permitted by law, all of the foregoing, whether now owned or hereafter
acquired by Mortgagors, affixed, attached or annexed to the Land shall be and
remain or become and constitute a part of the Mortgaged Property and the
security covered by and subject to the lien of this Mortgage. All such right,
title and interest of 1290 Mortgagor in and to the 1290 Land described on
Exhibit A-1, the interest of 1290 Mortgagor in and to the Improvements located
thereon and such other property with respect thereto described in Granting
Clause I is herein called the "1290 Property". All such right, title and
interest of 237 Park Mortgagor in and to the Land described on Exhibit A-2, the
interest of 237 Park Mortgagor in and to the Improvements located thereon and
such other property with respect thereto described in Granting Clause I is
herein called the "237 Park Property"; the 1290 Property and the 237 Park
Property each, a "Property" and such Properties are collectively called the
"Properties."
II. All right, title and interest of Mortgagors in and to (i) all
extensions, improvements, betterments, renewals, substitutes and replacements of
and on the Properties described in the foregoing Granting Clause I and (ii) all
additions and appurtenances thereto not presently leased to or owned by
Mortgagors and hereafter leased to, acquired by or released to Mortgagors or
constructed, assembled or placed upon the Mortgaged Property (including, but not
limited to, the fee estate
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in the Land) immediately upon such leasing, acquisition, release, construction,
assembling or placement, and without any further grant or other act by
Mortgagors.
III. All the estate, right, title and interest of Mortgagors in and to (i)
all judgments, insurance proceeds, awards of damages and settlements resulting
from condemnation proceedings or the taking of the Properties, or any part
thereof, under the power of eminent domain or for any damage (whether caused by
such taking or otherwise) to the Properties, or any part thereof, or to any
rights appurtenant thereto, and all proceeds of any sales or other dispositions
of the Properties or any part thereof; and Mortgagee is hereby authorized to
collect and receive said awards and proceeds and to give proper receipts and
acquittances thereto, subject to the conditions and limitations hereinafter set
forth; and (ii) all contract rights, general intangibles, actions and rights in
action, relating to the Properties including, without limitation, all rights to
insurance proceeds and unearned premiums arising from or relating to damage to
the Properties; and (iii) all proceeds, products, replacements, additions,
substitutions, renewals and accessions of and to the Properties.
IV. As additional security for the obligations secured hereby, Mortgagors
do hereby pledge and presently and absolutely assign to Mortgagee from and after
the date hereof (including any period of redemption), primarily and on a parity
with said real estate, and not secondarily, all the rents, issues and profits of
the Properties and all rents, issues, profits, revenues, royalties, bonuses,
rights, and benefits due, payable or accruing (including all deposits of money
as advance rent, for security or as ▇▇▇▇▇▇▇ money or as down payment for the
purchase of all or any part of the Properties but subject to applicable legal
requirements) (the "Rents") under any and all present and future leases,
subleases, underlettings, concession agreements, licenses, contracts or other
agreements relative to the ownership or occupancy of all or any portion of the
Properties and do hereby transfer and assign to Mortgagee all such leases and
agreements (the "Leases"). Mortgagors agree to cause all Rents (exclusive of
unapplied security deposits) payable under any Leases as they become due to be
deposited in accordance with Section 2.14 of the Credit Agreement and the terms
of the Cash Collateral Agreement. Mortgagors further agree to execute and
deliver such assignments of
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leases or assignments of land sale contracts as Mortgagee may from time to time
request. Upon the occurrence and during the continuance of an Event of Default
(1) Mortgagors agree, upon demand, to deliver to Mortgagee such additional
assignments thereof as Mortgagee may request and agree that Mortgagee may assume
the management of the Properties, and collect the Rents, applying the same upon
the Obligations and (2) Mortgagors hereby authorize and direct all tenants,
purchasers or other persons occupying or otherwise acquiring any interest in any
part of the Properties to pay the Rents due under the Leases to Mortgagee upon
request of Mortgagee. Mortgagors hereby appoint Mortgagee as their true and
lawful attorney in fact to manage said property and collect the Rents, with full
power to bring suit for collection of the Rents and possession of the
Properties, giving and granting unto said Mortgagee full power and authority to
do and perform all and every act and thing whatsoever requisite and necessary to
be done in the protection of the security hereby conveyed; provided, however,
that (i) this power of attorney coupled with an interest and assignment of rents
shall not be construed as an obligation upon Mortgagee to manage said property
or to make or cause to be made any repairs or to take any other action that may
be needful or necessary and (ii) Mortgagee agrees that until such Event of
Default has occurred and while it is continuing as aforesaid, Mortgagee shall
not exercise its rights pursuant to said power of attorney coupled with an
interest and shall permit Mortgagors to perform the aforementioned management
responsibilities. Upon Mortgagee's receipt of the Rents, at Mortgagee's option,
after the occurrence and during the continuance of an event of Default, it may
pay: (1) reasonable charges for collection hereunder, costs of necessary repairs
and other costs requisite and necessary in connection with the management of the
Properties, during the continuance of this power of attorney coupled with an
interest and assignment of rents including general and special taxes and
assessments and insurance premiums and (2) the Indebtedness secured hereby. This
power of attorney coupled with an interest and assignment of leases and rents
shall be irrevocable until this Mortgage shall have been satisfied and all of
the Mortgaged Property released of record and the releasing of this Mortgage
shall act as a revocation of this power of attorney coupled with an interest and
assignment of leases and rents with respect to such portion of the Mortgaged
Property so released. Mortgagee shall have and hereby expressly reserves the
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right and privilege (but assumes no obligation) to demand, collect, ▇▇▇ for,
receive and recover the Rents, or any part thereof, now existing or hereafter
made, and apply the same in accordance with law.
V. All of Mortgagors' right, title and interest in and to all personal and
intangible property and equipment of every nature whatsoever now or hereafter
located in, arising from or on or utilized in connection with the Mortgaged
Property, including but not limited to (a) all screens, window shades, blinds,
wainscoting, storm doors and windows, floor coverings, and awnings; (b) all
apparatus, machinery, accessions, equipment and appliances not included as
fixtures; (c) all items of furniture, furnishings, and personal property; (d)
all extensions, additions, improvements, betterments, renewals, substitutions,
and replacements to or of any of the foregoing (a)-(c) (all of said property in
(a)-(d) being collectively, the "Equipment"); (e) all accounts receivable
arising from the sale or other disposition of all or any of Mortgagors' real
property, buildings, structures and other improvements, fixtures, furniture,
furnishings, apparatus, machinery, appliances or other equipment, and all
extensions, renewals, improvements, substitutions and replacements thereto
whether owned or leased, now or hereafter acquired; (f) all accounts, general
intangibles, chattel paper, cash or monies of Mortgagors, wherever located,
whether in the form of cash or checks, and all cash equivalents including,
without limitation, all deposits and certificates of deposit, instruments,
whether negotiable or non-negotiable, debt notes both certificated and
uncertificated, repurchase obligations for underlying notes of the types
described herein, and commercial paper (i) received in connection with the sale
or other disposition of all or any of Mortgagors' real property, buildings,
structures and other improvements, fixtures, furniture, furnishings, apparatus,
machinery, appliances or other equipment, and all extensions, renewals,
improvements, substitutions and replacements thereto whether owned or leased,
now or hereafter acquired, (ii) maintained by Mortgagors in a segregated account
in trust for the benefit of Mortgagee pursuant to the requirements of the Loan
Documents or (iii) held by Mortgagee; (g) all trade names, trade marks, logos,
copyrights, good will and books and records relating to or used in connection
with the Mortgaged Property or any part thereof; and (h) all proceeds (as
defined in the Uniform Commercial Code) of all of the foregoing; it being
mutually agreed, in-
10
tended and declared, that the Mortgaged Property and all of the property rights
and fixtures owned by Mortgagors shall, so far as permitted by law, be deemed to
form a part and parcel of the Land and for the purpose of this Mortgage to be
real estate and covered by this Mortgage, it being also agreed that if any of
the property herein mortgaged is of a nature so that a security interest therein
can be perfected under the Uniform Commercial Code, this instrument shall
constitute a security agreement, fixture filing and financing statement, and
Mortgagors agree to execute, deliver and file or refile any financing statement,
continuation statement, or other instruments Mortgagee may reasonably require
from time to time to perfect or renew such security interest under the Uniform
Commercial Code. To the extent permitted by law, (i) all of the fixtures are or
are to become fixtures on Land; and (ii) this instrument, upon recording or
registration in the real estate records of the proper office, shall constitute a
"fixture-filing" within the meaning of Sections 9-313 and 9-402 of the Uniform
Commercial Code. The remedies for any violation of the covenants, terms and
conditions of the agreements herein contained shall be as prescribed herein or
by general law, or, as to that part of the security in which a security interest
may be perfected under the Uniform Commercial Code, by the specific statutory
consequences now or hereafter enacted and specified in the Uniform Commercial
Code, all at Mortgagee's sole election.
VI. All of Mortgagors' right, title, and interest in, to and under (i) all
contracts, including the Property Management Agreement, Asset Management
Agreement and the Leasing Agency Agreement (as each term is herein defined) and
agreements relating to the Properties, and other documents, books and records
related to the operation of the Properties; (ii) all consents, licenses,
warranties, guaranties and building and other permits required or useful for the
construction, completion, occupancy and operation of the Properties; and (iii)
all plans and specifications, engineering reports, land planning, maps, surveys,
and any other reports, exhibits or plans and specifications used or to be used
in connection with the construction, operation or maintenance of the Properties,
together with all amendments and modifications thereof.
VII. All of Mortgagors' right, title and interest in the Pledged Notes.
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VIII. All of Mortgagors' right, title and interest in all proceeds, both
cash and non-cash, of the foregoing.
IX. The right in the name and on behalf of the Mortgagor, to appear in and
defend any action or proceeding brought with respect to the Mortgaged Property
and to commence any action or proceeding to protect the interest of the
Mortgagee in the Mortgaged Property.
X. All of Mortgagors' rights to encumber the Properties.
1. Definitions. All capitalized terms used but not otherwise defined herein
shall have the meanings assigned to them in the Credit Agreement. The words
"herein," "hereof" and "hereunder" and other words of like import refer to this
Mortgage as a whole and not to any particular Section, subsection or other
subdivision. In addition, wherever used in this Mortgage, the following terms,
and the singular and plural thereof, shall have the following meanings:
Affiliate: With respect to any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities or other beneficial interest,
by contract or otherwise; and the terms "controlling" and "controlled" have the
meanings correlative to the foregoing.
Alteration: As defined in Section 10(c) here- of.
Asset Management Agreement: As defined in the Credit Agreement.
Cash Collateral Agreement: As defined in the Credit Agreement.
Casualty Amount: As defined in Section 6(b) hereof.
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Closing Date: As defined in the Credit Agreement.
Credit Agreement: As defined in the recitals hereof.
Default: The occurrence or existence of any event or condition which with
or without the giving of notice or the passage of time, or both, would
constitute an Event of Default hereunder.
Default Rate: A rate per annum equal to the sum of the Alternate Base Rate
(as defined in the Credit Agreement) for such day plus three percent (3%).
Domestic Business Day: As defined in the Credit Agreement.
Environmental Certificate: As defined in Section 18(b) hereof.
Environmental Claim: As defined in the Credit Agreement.
Environmental Event: As defined in Section 18(b) hereof.
Environmental Laws: As defined in the Credit Agreement.
Environmental Report: As defined in the Credit Agreement.
Equipment: As defined in Granting Clause V hereof.
ERISA: Shall mean the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations promulgated thereunder.
Events of Default: The occurrence of any of the following shall constitute
an Event of Default under this Mortgage:
(a) If Mortgagors fail to pay any amount payable pursuant to this
Mortgage when due and payable in accordance with the provisions hereof
and such failure continues for three (3) Domestic
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Business Days after Mortgagee delivers notice there-
of; or
(b) Cancellation of the insurance required by Section 5 of this
Mortgage without substitution of replacement coverage meeting the
requirements thereof; or
(c) Any violation of the terms of Section 7(a) (subject to the
terms of Section 7(c) and paragraph (a) above)), Section 7(b) (subject
to the terms of Section 7(c)) or Section 9(a) through (c) of this
Mortgage; or
(d) An Event of Default (as defined therein) under the Credit
Agreement; or
(e) Any other default in the perfor- ▇▇▇▇▇, or breach, of any
material covenant, representation or warranty of either Mortgagor in
this Mortgage or in any other Loan Document (other than those
specifically dealt with elsewhere in this Section) and continuance of
such default or breach for a period of thirty (30) days after written
notice thereof has been given to Mortgagors by the Agent; provided,
however, that in the case of any such default that is susceptible of
cure but cannot reasonably be cured within thirty (30) days after
notice from the Agent and provided further that Mortgagors shall have
commenced to cure such default within such thirty (30) day period and
thereafter diligently and expeditiously proceeds to cure the same,
such thirty (30) day period shall be extended for such time as is
reasonably necessary for Mortgagors in the exercise of due diligence
to cure such default (but in no event longer than one hundred twenty
(120) days); or
(f) This Mortgage or any other Loan Document or any Lien granted
hereunder or thereunder shall (except in accordance with the terms
hereof or thereof), in whole or in part, terminate, cease to be
effective or cease to be a legally valid, binding and enforceable
obligation of Mortgagors, or any Lien securing the Indebtedness shall,
in whole or in part, cease to be a perfected first priority Lien,
subject to the Permitted Liens; or
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(g) The sale, conveyance, transfer, encumbrance, or disposition,
whether voluntarily, involuntarily or otherwise, of the Improvements
and/or the Land or any interest therein or any interest in either
Mortgagor in violation of the terms of this Mortgage or the Credit
Agreement; or
(h) Any "Event of Default" as de- fined in any other Loan
Documents occurs.
Notwithstanding anything to the contrary contained in this Mortgage, the
Credit Agreement or the Loan Documents, no grace period or right to notice
granted to Mortgagors herein with respect to any Event of Default is intended to
duplicate any other grace period or right to notice granted to Mortgagors
herein, in the Credit Agreement or in the other Loan Documents with respect to
such Event of Default and in the event of any inconsistency, the grace period or
right to notice granted herein shall apply.
GAAP: Shall mean United States generally ac- cepted accounting principles,
consistently applied.
Governmental Authority: As defined in the Credit Agreement.
Grant: Shall mean ▇▇▇▇▇, ▇▇▇▇▇ a security interest in, bargain, sell, lien,
mortgage, convey, pledge, hypothecate, assign, transfer, warrant and set over.
Hazardous Substances: As defined in the Credit Agreement.
Impositions: All taxes (including, without limitation, all ad valorem,
sales (including those imposed on lease rentals), use, single business, gross
receipts, value added, intangible transactions, privilege or license or similar
taxes), assessments (including, without limitation, all assessments for public
improvements or benefits, whether or not commenced or completed prior to the
date hereof and whether or not commenced or completed within the term of this
Mortgage), water, sewer or other rents and charges, excises, levies, fees
(including, without limitation, license, permit, inspection, authorization and
similar fees), and all other governmental charges, in each case whether general
or special,
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ordinary or extraordinary, or foreseen or unforeseen, of every character in
respect of the Mortgaged Property and/or any Rents (including all interest and
penalties thereon), which at any time prior to, during or in respect of the term
hereof may be assessed or imposed on or in respect of or be a Lien upon (a)
Mortgagors (including, without limitation, all income, franchise, single
business or other taxes imposed on Mortgagors for the privilege of doing
business in the State of New York) or Mortgagee arising as a result of or with
respect to its capacity as Mortgagee hereunder, (b) the Mortgaged Property or
any other collateral delivered or pledged to Mortgagee in connection with the
Loan, or any part thereof, or any Rents therefrom or any estate, right, title or
interest therein, or (c) any occupancy, operation, use or possession of, or
sales from, or activity conducted on, or in connection with the Mortgaged
Property or the leasing or use of all or any part thereof. Nothing contained in
this Mortgage shall be construed to require Mortgagors to pay any tax,
assessment, levy or charge imposed on Mortgagee in the nature of a franchise,
capital levy, estate, inheritance, succession, income or net revenue tax.
Improvements: As defined in Granting Clause I hereof.
Indebtedness: As defined in the recitals hereof.
Indemnitee: As defined in the Credit Agree- ment.
Independent Architect: An architect selected by Mortgagors, and acceptable
to Mortgagee, such acceptance not to be unreasonably withheld or delayed,
licensed to practice in the State of New York and having at least ten (10) years
of experience.
Insurance Requirements: Shall mean all terms of any insurance policy
required hereunder covering or applicable to the Properties or Equipment or any
part thereof, all requirements of the issuer of any such policy, and all orders,
rules, regulations and other requirements of the National Board of Fire
Underwriters (or any other body exercising similar functions) applicable to or
affecting the Properties or Equipment or any
16
part thereof or any use of the Properties or Equipment or
any part thereof.
Land: As defined in the recitals hereof.
Leases: As defined in Granting Clause IV hereof.
Leasing Agency Agreement: As defined in the Credit Agreement.
Legal Requirements: As defined in Section 11.
Lien: As defined in the Credit Agreement.
Loan: As defined in the recitals hereof.
Loan Amount: As defined in the recitals here- of.
Loan Documents: As defined in the Credit Agreement.
Major Alteration: As defined in the Credit Agreement.
Major Lease: As defined in the Credit Agree- ment.
Manager: As defined in the Credit Agreement.
Material Adverse Effect: As defined in the Credit Agreement.
Mortgage: As defined in the recitals hereof.
Mortgage Escrow Amounts: As defined in Section 8(a).
Mortgaged Property: As defined in the Granting Clause to this Mortgage.
Mortgagee: As defined in the recitals hereof.
Mortgagor: As defined in the recitals hereof.
Mortgagors: As defined in the recitals hereof.
17
Notes: As defined in the recitals hereof.
Obligations: As defined in the recitals here- of.
Officer's Certificate: As defined in the Credit Agreement.
Permitted Liens: As defined in the Credit Agreement.
Person: Shall mean any individual, corporation, partnership, joint venture,
limited liability company, estate, trust, unincorporated association, any
Federal, state, county or municipal government or any political subdivision
thereof.
Proceeds: As defined in Section 6(b) hereof.
Property or Properties: As defined in Granting Clause I hereof.
Property Management Agreement: As defined in the Credit Agreement.
Rents: As defined in Granting Clause IV here- of.
Taking: Shall mean a temporary or permanent taking by any Governmental
Authority as the result or in lieu or in anticipation of the exercise of the
right of condemnation or eminent domain, of all or any part of the Properties,
or any interest therein or right accruing thereto, including any right of access
thereto or any change of grade affecting the Land or any part thereof.
Tenant: Shall mean any Person leasing any portion of the Properties and
obligated to pay rent pursuant to a Lease.
Transfer: As defined in the Credit Agreement.
Work: As defined in Section 6(b) hereof.
1290 Mortgagor: As defined in the recitals hereof.
18
1290 Permitted Liens: Means Permitted Liens that affect only the 1290 Land.
237 Park Permitted Liens: Means Permitted Liens that affect only the ▇▇▇
▇▇▇▇ ▇▇▇▇.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇: As defined in the recitals hereof.
2. Warranty.
Each Mortgagor represents and warrants to, and covenants and agrees with,
Mortgagee as follows:
(a) All improvements now being or hereafter constructed on the
Properties shall be completed in a good and workmanlike manner,
substantially in accordance with all applicable governmental laws,
statutes, ordinances, codes, rules, regulations and requirements, and
otherwise in accordance with the provisions of the Credit Agreement
and the other Loan Documents.
(b) This Mortgage upon its due execution and proper recordation
is and will remain a valid, enforceable and perfected first Lien on
and a security interest in the Mortgaged Property subject to the
Permitted Liens.
(c) This Mortgage and each of the Loan Documents executed by each
Mortgagor, is the legal, valid and binding obligation of such
Mortgagor, enforceable against such Mortgagor in accordance with their
terms, subject to applicable bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and other laws affecting
creditor's rights generally in effect from time to time.
(d) The 1290 Mortgagor owns good fee simple and insurable title
to the 1290 Land subject only to the 1290 Permitted Liens. The 237
Park Mortgagor owns good fee simple and insurable title to the 237
Park Lien, subject only to the 237 Park Permitted Liens. Each
Mortgagor will preserve such title to its Property and will forever
warrant and defend same and the validity and priority of the lien
hereof from and against any and all claims whatsoever;
19
(e) On the date hereof, to each Mortgagor's knowledge, no portion
of the Improvements at the Properties has been materially damaged,
destroyed or injured by fire or other casualty which is not now fully
restored or in the process of being restored;
(f) Each Mortgagor has and will maintain, in effect at all times
until the Indebtedness and Obligations are satisfied in full, all
necessary material licenses, permits, authorizations, registrations
and approvals to own, use, occupy and operate each Property as a
first-class institutional office building and has full power and
authority to carry on its business at each of the Properties as
currently conducted and has not received any written notice of any
violation of any such licenses, permits, authorizations, registrations
or approvals that materially impair the value of the Properties for
which such notice was given or which would affect the use or operation
of either Property in any material respect;
(g) As of the date hereof, neither Mortgagor has received any
written notice of any Taking or threatened Taking of either Property
or any portion thereof;
(h) The Properties and the Equipment located thereon constitutes
all of the real property, equipment and fixtures currently owned by
either Mortgagor or used in the operation of the business located on
the Properties;
(i) Each Property has adequate access to public streets, roads or
highways;
(j) Each Property constitutes a separate tax lot or lots, with a
separate tax as- sessment, independent of any other land or improve-
ments;
(k) All utility services necessary for the operation of each
Property have been connected and are available in adequate capacities
directly from utility lines and without the need for private easements
not presently existing;
20
(l) Each Mortgagor is not and shall not be an "employee benefit
plan" (within the meaning of Section 3(3) of ERISA) to which ERISA
applies and each Mortgagor's assets do not and will not constitute
plan assets;
(m) To the best of each Mortgagor's knowledge, neither Mortgagor
is in material default under the terms, conditions or provisions of
any of the Leases or Agreements described in Section 13 hereof which
affect either Mortgagor;
(n) Each Mortgagor is now, and after giving effect to this
Mortgage, will be in a solvent condition;
(o) Mortgagor is not in default under any note, loan or security
agreement to which it is a party;
(i) The execution and delivery of this Mortgage by Mortgagors
does not constitute a "fraudulent conveyance" within the meaning of
Title 11 of the United States Code as now constituted or under any
other applicable statute;
(p) No bankruptcy or insolvency pro- ceedings are pending or
contemplated by or against either Mortgagor; and
(q) To the best of each Mortgagor's knowledge, there are no
existing, threatened or pending actions or proceedings affecting any
portion of the Mortgaged Property except for possible negligence
actions or proceedings which are fully covered by insurance or
collection actions against tenants disclosed in writing prior to the
date hereof to Agent.
3. Payment and Performance of Obligations Secured. Each Mortgagor shall
jointly and severally promptly pay when due the principal of and interest on the
Indebtedness, any prepayments, late charges and fees provided for in the Notes,
and all other payment Obligations secured by this Mortgage, all in lawful money
of the United States of America, and shall further perform fully and in a timely
manner all Obligations of Mortgagors. All sums payable by Mortgagors hereunder
shall be
21
paid without demand (except as otherwise specifically set forth herein or in the
other Loan Documents), counterclaim, offset, deduction or defense all without
relief from valuation and appraisement laws. Mortgagors waive all rights now or
hereafter conferred by statute or otherwise to any such demand (except as so
provided herein or in the other Loan Documents), counterclaim, setoff, deduction
or defense.
4. Negative Covenants. Each Mortgagor cove- nants and agrees that it shall
not:
(a) partition the Properties;
(b) transfer all or portion of the Mortgaged Property or any
interest of either Mortgagor other than pursuant to leases of space
therein in accordance with the terms hereof and the Credit Agreement;
(c) file a petition for voluntary bankruptcy under the Bankruptcy
Code or similar state law;
(d) dissolve, terminate, liquidate, merge with or consolidate
into another Person, except as expressly permitted pursuant to this
Mortgage or the Credit Agreement; or
(e) engage in any activity that would subject it to regulation
under ERISA, other than activity with respect to Plans, Multiemployer
Plans and Benefit Arrangements sponsored or contributed to on the date
hereof, including for this purpose Multiemployer Plans to which the
Borrower will become obligated to contribute upon execution or
assumption of collective bargaining agreements relating to the 237
Park Property and the 1290 Property; provided, however, such
engagement shall not cause the ERISA Group to incur any material
liability in excess of the liabilities that would be incurred under
the terms of such Plans, Multiemployer Plans and Benefit Arrangements
as of the date hereof.
22
5. Insurance.
(a) Insurance Coverage Requirements. Mortgagors shall keep, or cause to be
kept insurance with respect to the Properties, in full force and effect of the
types and minimum limits as follows during the term of this Mortgage:
(i) Property Insurance. Insurance with respect to the Properties
and the Equipment against any peril included within the classification
"All Risks of Physical Loss" with extended coverage in an amount equal
to the full insurable value of the Properties and the Equipment
located thereon, the term "full insurable value" to mean the actual
replacement cost of the Improvements and the Equipment at the
Properties (without taking into account any depreciation, and
exclusive of excavations, footings and foundations, landscaping and
paving);
(ii) Liability Insurance. Compre- hensive general liability
insurance, including bodily injury, death and property damage
liability, and umbrella liability insurance against any and all
claims, including all legal liability to the extent insurable imposed
upon Mortgagee and all court costs and attorneys' fees and expenses,
arising out of or connected with the possession, use, leasing,
operation, maintenance or condition of each of the Properties in such
amounts as are generally required by institutional lenders for
properties comparable to the Properties but in no event for limits of
less than $5,000,0000 per occurrence with combined single limit
coverage for bodily injury or property damage;
(iii) Workers' Compensation Insur- ance. Statutory workers'
compensation insurance (to the extent the risks to be covered thereby
are not already covered by other policies of insurance maintained by
or on behalf of Mortgagors), with respect to any work on or about the
Properties;
(iv) Business Interruption. Busi- ness interruption and/or loss
of "rental value" insurance for the Properties in an amount equal to
two (2) years' "rental value" attributable to the Properties and based
on the "rental value" for the immediately preceding year and otherwise
sufficient
23
to avoid any co-insurance penalty, the term "rental value" to mean the
sum of (A) the total Rents payable under the Leases at the Properties
and (B) the total amount of all other amounts to be received by
Mortgagors or third parties which are the legal obligation of the
Tenants under their Leases, reduced to the extent such amounts would
not be received because of operating expenses (or other payments to
third parties) not incurred during a period of non-occupancy of that
portion of the Properties then not being occupied;
(v) Indemnification. Contractual Indem- nification Insurance
covering Mortgagors' obligation to indemnify Mortgagee as required
under Section 35 hereof;
(vi) Boiler and Machinery Insurance. Broad form boiler and
machinery insurance (without exclusion for explosion) covering all
boilers or other pressure vessels, machinery and equipment located in,
on or about the Properties and insurance against loss of occupancy or
use arising from any such breakdown in such amounts as are generally
available at commercially reasonable premiums and are generally
required by institutional lenders for properties comparable to the
Properties; and
(vii) Other Insurance. Such other insurance with respect to the
Properties and the Equipment located therein against loss or damage as
are reasonably requested by Mortgagee provided such insurance is of
the kind from time to time customarily insured against and in such
amounts as are generally required by institutional lenders for
properties comparable to the Properties.
(b) Ratings of Insurers. All insurance coverage shall be provided by one or
more domestic primary insurers having an ▇▇▇▇▇▇ ▇. Best Company, Inc. rating of
"A" or better and financial size category of not less than VIII except to the
extent that insurance in force on the date of this Mortgage does not satisfy
such criteria or if otherwise approved by Mortgagee. All insurers providing
insurance required by this Mortgage shall be authorized to issue insurance in
the State of New York.
24
(c) Form of Insurance Policies; Endorse- ments. All insurance policies
shall be in such form and with such endorsements as are comparable to the forms
of and endorsements to Mortgagors' insurance policies in effect on the date
hereof or otherwise in accordance with commercially reasonable standards applied
by prudent owners of first-class, institutional office buildings in the City of
New York. Certified copies of all of the above-mentioned insurance policies have
been delivered to and shall be held by Mortgagee. All such policies (other than
for statutory workers' compensation insurance) shall name Mortgagee as an
additional insured/loss payee, shall provide that all Proceeds be payable to
Mortgagee as set forth in Section 6 hereof, and shall contain: (i) a standard
"non-contributory mortgagee" endorsement or its equivalent relating, inter alia,
to recovery by Mortgagee notwithstanding the negligent or willful acts or
omissions of Mortgagors and, with respect to Equipment, contain a lender's loss
payable clause endorsement or any equivalent endorsement; (ii) a waiver of
subrogation endorsement as to Mortgagee providing that no policy shall be
impaired or invalidated by virtue of any act, failure to act, negligence of, or
violation of declarations, warranties or conditions contained in such policy by
Mortgagors, Mortgagee or any other named insured, additional insured or loss
payee, except for the willful misconduct of Mortgagee knowingly in violation of
the conditions of such policy; (iii) an endorsement indicating that neither
Mortgagee nor Mortgagors shall be or be deemed to be a co-insurer with respect
to any risk insured by such policies and shall provide for a deductible per loss
of an amount not more than that which is customarily maintained by prudent
owners of first-class, institutional office buildings in the City of New York,
but in no event in excess of $100,000; (iv) a provision that such policies shall
not be cancelled or materially amended, including, without limitation, any
amendment reducing the scope or limits of coverage, without at least thirty (30)
days prior written notice to Mortgagee in each instance; (v) include effective
waivers by the insurer of all claims for insurance premiums against any loss
payees, additional insureds and named insureds (other than Mortgagors) and (vi)
shall be otherwise in form and substance reasonably satisfactory to Mortgagee.
Certificates of insurance with respect to all renewal and replacement policies
shall be delivered to Mortgagee not less than thirty (30) days prior to the
expiration date of any of the insurance policies required to be main-
25
tained hereunder which certificates shall bear notations evidencing payment of
applicable premiums and originals (or certified copies) of such insurance
policies shall be delivered to Mortgagee promptly after Mortgagors' receipt
thereof. If Mortgagors fail to maintain and deliver to Mortgagee the original
policies (or certified copies) or certificates of insurance required by this
Mortgage, Mortgagee may, at its option, procure such insurance, and Mortgagors
shall reimburse Mortgagee for the amount of all premiums paid by Mortgagee
thereon promptly, upon demand by Mortgagee, with interest thereon at the Default
Rate from the date paid by Mortgagee to the date of repayment, and such sum
shall be a part of the Indebtedness secured by this Mortgage. Blanket insurance
policies shall not be acceptable for the purposes of this Section 5 unless
otherwise reasonably approved to the contrary by Mortgagee.
Mortgagee shall not by the fact of approving, disapproving, accepting,
preventing, obtaining or failing to obtain any insurance, incur any liability
for or with respect to the amount of insurance carried, the form or legal
sufficiency of insurance contracts, solvency of insurance companies, or payment
or defense of lawsuits, and Mortgagors hereby expressly assumes full
responsibility therefor and all liability, if any, with respect thereto.
(d) Compliance with Insurance Require- ments. Mortgagors shall comply with
all Insurance Requirements and shall not bring or keep any article upon the
Properties or cause or permit any condition to exist thereon which would be
prohibited by or would invalidate insurance coverage maintained, or required
hereunder to be maintained, by Mortgagors on or with respect to any part of the
Mortgaged Property pursuant to this Section 5.
6. Condemnation and Insurance Proceeds.
(a) Each Mortgagor will promptly notify Mortgagee in writing upon obtaining
knowledge of (i) the institution of any proceedings relating to any Taking of,
or (ii) the occurrence of any casualty, damage or injury to, the Mortgaged
Property or Equipment located thereon or any portion thereof the restoration of
which is estimated by the applicable Mortgagor in good faith to cost more than
$250,000.
26
(b) In the event of any Taking of, or casualty or other damage or injury,
to the Mortgaged Property, or Equipment located thereon, Mortgagors' right,
title and interest in and to all compensation, awards, proceeds, damages,
claims, insurance recoveries, causes and rights of action (whether accrued prior
to or after the date hereof) and payments which either Mortgagor may receive or
to which either Mortgagor may become entitled with respect to the Mortgaged
Property or any part thereof (collectively, "Proceeds"), in connection with any
such Taking, casualty or other damage or injury to the Mortgaged Property, or
any part thereof, or Equipment located thereon are hereby assigned to and shall
be paid to Mortgagee. Notwithstanding anything to the contrary set forth in this
Mortgage, to the extent such Proceeds are not in excess of $1,000,000 (the
"Casualty Amount"), then Mortgagee hereby consents to and agrees that such
Proceeds are to be paid directly to Mortgagors to be applied to restoration of
the Mortgaged Property in accordance with the terms hereof. Subject to the
provisions of Sections 6(c) and 6(d) hereof, promptly after the occurrence of
any damage or destruction to all or any portion of the Mortgaged Property or a
Taking of a portion of the Mortgaged Property, Mortgagors shall commence and
diligently prosecute to completion the repair, restoration and rebuilding of the
Mortgaged Property (in the case of a Taking, to the extent it is capable of
being restored) (such repair, restoration and rebuilding are sometimes
hereinafter collectively referred to as the "Work") so damaged, destroyed or
remaining after such Taking in full compliance with all Legal Requirements and
free and clear of any and all Liens except the Permitted Liens; it being
understood, however, that Mortgagors shall not be obligated to restore the
Mortgaged Property to the precise condition of the Mortgaged Property prior to
any Taking, casualty or other damage or injury to the Mortgaged Property, if the
Work actually performed, if any, or failed to be performed, shall have no
material adverse effect on the value of the Mortgaged Property from the value
that the Mortgaged Property would have had if the same had been restored to its
condition immediately prior to such taking or casualty. Mortgagors will, in good
faith and in a commercially reasonable manner, file and prosecute the
adjustment, compromise or settlement of any claim for insurance or Taking
Proceeds and, subject to Mortgagors' right to receive the direct payment of any
Proceeds up to the Casualty Amount subject to the provisions below, will cause
the same to be collected and paid
27
over to Mortgagee, to be held and applied in accordance with the provisions of
this Mortgage. Each Mortgagor hereby irrevocably authorizes and empowers
Mortgagee, in the name of such Mortgagor as its true and lawful
attorney-in-fact, to file and prosecute such claim and to collect and to make
receipt for any such payment, and, in the event Mortgagors fail so to act for a
period of ten (10) days following Mortgagors' receipt of written notice from
Mortgagee or if an Event of Default shall have occurred and be continuing, then
in such case Mortgagee may file such claim and prosecute it with counsel
satisfactory to it at the expense of Mortgagors. Mortgagee shall have the right
to approve, such approval not to be unreasonably withheld, any settlement which
might result in any Proceeds in excess of the Casualty Amount, and Mortgagors
will deliver or cause to be delivered to Mortgagee all instruments reasonably
requested by Mortgagee to permit such approval. Mortgagors will pay all costs,
fees and expenses reasonably and actually incurred by Mortgagee (including all
reasonable attorneys' fees and expenses actually incurred, the reasonable fees
of insurance experts and adjusters and reasonable costs incurred in any
litigation or arbitration) in connection with the settlement of any claim for
insurance or Taking Proceeds and seeking and obtaining of any payment on account
thereof in accordance with the foregoing provisions. If any insurance or Taking
Proceeds are received by either Mortgagor, such Proceeds shall be received in
trust for Mortgagee, shall be used to pay for the cost of the Work in accordance
with the terms hereof, and in the event such Proceeds are in excess of the
Casualty Amount shall be forthwith paid to Mortgagee to be held by Mortgagee in
a segregated account in trust for Mortgagors in accordance with the provisions
of the Cash Collateral Agreement, in each case to be applied or disbursed in
accordance with the provisions hereof.
(c) Upon the occurrence and during the continuance of an Event of Default
hereunder, all Proceeds shall be paid over to Mortgagee and shall be applied
first toward reimbursement of Mortgagee's reasonable costs and expenses actually
incurred in connection with recovery of the Proceeds and disbursement of the
Proceeds (as further described below), including, without limitation, reasonable
administrative costs and inspection fees, and then at Mortgagee's option, to
restoration or to the payment or prepayment of the Indebtedness secured hereby
in such order as, Mortgagee shall determine.
28
(d) If Proceeds are not required to be applied towards payment of the
Indebtedness pursuant to Section 6(c) above, then Mortgagee shall make the
Proceeds which it is holding pursuant to the terms hereof available to
Mortgagors (after payment of any reasonable expenses actually incurred by
Mortgagee in connection with the collection thereof) for payment of or
reimbursement of Mortgagors' expenses incurred with respect to the Work, upon
the following terms and subject to the following conditions:
(i) there shall be no continuing Event of Default hereunder;
(ii) if the estimated cost of the Work (as estimated by an
Independent Architect) shall exceed the Proceeds available, Mortgagors
shall deliver to Mortgagee a Letter of Credit (as defined in the
Credit Agreement) or other security satisfactory to Mortgagee;
(iii) Mortgagee shall be furnished with an estimate of the cost
of the Work accompanied by an Independent Architect's certification as
to such costs and appropriate plans and specifications for the Work
and that the Work can be completed by the earlier of (x) the date
which is six months prior to the Termination Date (as defined in the
Credit Agreement) or (y) the date which is twenty-four months after
the date such Taking, casualty or other damage or injury to the
Mortgaged Property occurred. The plans and specifications shall
require that the Work be done in a first-class workmanlike manner at
least equivalent to the quality and character of the original work in
the Improvements (provided, however, that in the case of a Taking the
restoration of the Mortgaged Property shall be done to the extent
reasonably practicable after taking into account the consequences of
such Taking), so that upon completion thereof, the Mortgaged Property
shall be at least equal in value to the Mortgaged Property immediately
prior to the damage or destruction. Mortgagors shall restore all
Improvements such that when they are fully restored and/or repaired
that such Improvements and their contemplated use fully comply with
all applicable Legal Requirements including, without limitation,
29
zoning, environmental and building laws, codes,
ordinances and regulations.
(e) Disbursement of the Proceeds shall be made from time to time (but not
more frequently than once in any month) by Mortgagee as the Work progresses upon
receipt by Mortgagee of (i) an Officers' Certificate dated not more than thirty
(30) days prior to the application for such payment, requesting such payment or
reimbursement and setting forth the Work performed which is the subject of such
request, the parties which performed such Work and the actual cost thereof, and
also certifying that such Work and materials are free and clear of Liens other
than Permitted Liens and (ii) an Independent Architect's certificate certifying
performance of the Work together with an estimate of the cost to complete the
Work. No payment made prior to the final completion of the Work shall exceed
ninety percent (90%) of the value of the Work performed or materials furnished
and incorporated into the Improvements from time to time (provided that each
trade shall be entitled to payment of its hold-back upon completion of its
component of the Work and satisfactory fulfillment of the requirements herein,
including delivery of final lien waivers), and at all times the undisbursed
balance of said Proceeds together with all amounts deposited, bonded, guaranteed
or otherwise funded pursuant to clause (ii) above, shall be at least sufficient
to pay for the cost of completion of the Work, free and clear of Liens other
than Permitted Liens; final payment shall be made upon receipt by Mortgagee of a
certification by an Independent Architect, as to the completion substantially in
accordance with the submitted plans and specifications, and the receipt by
Mortgagee of final lien waivers from each contractor or materialman. Mortgagee
may at its option require an endorsement to its title insurance policy insuring
the continued priority of the Lien of this Mortgage (subject to Permitted Liens)
as to all sums advanced hereunder, such endorsement to be paid for by
Mortgagors.
(f) In the event that any condition to application of Proceeds to the Work
contained in Section 6(d) above is not satisfied, then Mortgagee may, upon
thirty (30) days prior written notice to Mortgagors, apply all Proceeds with
respect to the Taking of or damage or injury to the Mortgaged Property in
question to the payment or prepayment of all or any portion of the Indebtedness
secured hereby. Notwithstanding the forego-
30
ing contained in Section 6(d) above, if the cost of the Work as estimated by the
Independent Architect's certification exceeds $62,500,000 with respect to the
1290 Property, then upon thirty (30) days prior written notice all Proceeds with
respect to the Taking of or damage or injury to the 1290 Property, may, at
Mortgagee's option, be applied by Mortgagee to the payment or prepayment of all
or any portion of the Indebtedness secured hereby with respect to the 1290
Allocated Loan Amount and if the cost of the Work as estimated by the
Independent Architect's certification exceeds $42,500,000 with respect to the
237 Park Property, then upon thirty (30) days prior written notice all Proceeds
with respect to the Taking of or damage or injury to the 237 Park Property, may,
at Mortgagee's option, be applied by Mortgagee to the payment or prepayment of
all or any portion of the Indebtedness secured hereby with respect to the 237
Park Allocated Loan Amount.
(g) In the event that, after the comple- tion of the Work and payment of
all costs of completion, there are excess Proceeds, then upon thirty (30) days
prior written notice such excess Proceeds with respect to the Taking of or
damage or injury to the Mortgaged Property may be applied by Mortgagee to the
payment or pre-payment of all or any portion of the Indebtedness secured hereby.
(h) In the event of a Taking of all of the Mortgaged Property, Mortgagors
shall prepay the Notes in full, whether or not the Proceeds are sufficient.
7. Impositions, Liens and Other Items.
(a) Subject to the right of contest set forth in Section 7(c), Mortgagors
shall pay all Impositions which are attributable to or affect the Properties or
Mortgagors, prior to the date such Impositions shall become delinquent or late
charges may be imposed thereon, directly to the applicable taxing authority with
respect thereto, unless and to the extent Mortgagee shall pay such Impositions
pursuant to the provisions of the Cash Collateral Agreement.
(b) Subject to the right of contest set forth in Section 7(c), each
Mortgagor shall at all times keep the Mortgaged Property and the Equipment
located thereon free from all Liens (other than the Lien hereof
31
and Permitted Liens) and shall pay when due and payable all claims and demands
of mechanics, materialmen, laborers and others which, if unpaid, might result in
or permit the creation of a Lien on the Mortgaged Property or any portion
thereof and the Equipment located thereon, whether ranked senior, pari passu or
junior to the priority of the Lien created hereby, and shall in any event cause
the prompt, full and unconditional discharge of all Liens imposed on or against
the Mortgaged Property, or any portion thereof and the Equipment located thereon
within forty-five (45) days after Mortgagors receive notice of the filing
thereof. Each Mortgagor shall do or cause to be done, at the sole cost of such
Mortgagor, everything necessary to fully preserve the first priority of the Lien
of this Mortgage against the Mortgaged Property and the Equipment located
thereon subject to the Permitted Liens. Upon the occurrence and during the
continuance of an Event of Default with respect to its Obligations as set forth
in this Section 7, Mortgagee may (but shall not be obligated to) make such
payment or discharge such Lien, and Mortgagors shall reimburse Mortgagee on
demand for all such advances pursuant to Section 14 hereof.
(c) Nothing contained herein shall be deemed to require Mortgagors to pay,
or cause to be paid, any Imposition, to satisfy any Lien or to comply with any
Legal Requirement or Insurance Requirement so long as Mortgagors are in good
faith, and by proper legal proceedings, diligently contesting the validity,
amount or application thereof, provided that in each case, at the time of the
commencement of any such action or proceeding, and during the pendency of such
action or proceeding (i) no Event of Default shall exist and be continuing
hereunder, (ii) adequate reserves with respect thereto are maintained on
Mortgagors' books in accordance with GAAP, (iii) such contest operates to
suspend collection or enforcement as the case may be, of the contested
Imposition or Lien and such contest is maintained and prosecuted continuously
and with diligence, (iv) in the case of any Insurance Requirement, the failure
of Mortgagors to comply therewith shall not impair the validity of any insurance
required to be maintained by Mortgagors under Section 5 or the right to full
payment of any claims thereunder, and (v) in the case of Impositions and Liens,
during such contest, Mortgagors shall provide security in the form required by
Section 6(d)(ii) assuring the discharge of Mortgagors' obligations being con-
32
tested and of any additional interest, charge, or penalty arising from such
contest. Notwithstanding the foregoing, any such reserves or the furnishing of
any bond or other security, Mortgagors promptly shall comply with any contested
Legal Requirement or Insurance Requirement or shall pay any contested Imposition
or Lien, and compliance therewith or payment thereof shall not be deferred, if,
at any time a Property or any portion thereof, or any Equipment located thereon
shall be, in Mortgagee's reasonable judgment, in danger of being forfeited or
lost or Mortgagee may be subject to civil or criminal damages as a result
thereof. If such action or proceeding is terminated or discontinued adversely to
Mortgagors, Mortgagors, upon written demand, shall deliver to Mortgagee
reasonable evidence of Mortgagors' compliance with such contested Imposition,
Lien, Legal Requirements or Insurance Requirements, as the case may be.
8. Funds for Taxes and Insurance.
(a) Subject to the provisions of the Cash Collateral Agreement, Mortgagors
shall deposit in the Cash Collateral Account (as defined in the Cash Collateral
Agreement) amounts sufficient to discharge the obligations of Mortgagors under
Sections 5 and 7 hereof as and when they become due (such amounts, the "Mortgage
Escrow Amounts"). Mortgagors shall initially pay a sum which bears the same
relation to the annual insurance premiums for all insurance required by the
terms hereof and Impositions assessed against the Mortgaged Property for the
insurance period or tax year then in effect, as the case may be, as (i) the
number of months elapsed as of the date hereof since the last preceding
installment of said premiums or Impositions shall have become due and payable
bears to (ii) twelve (12) (if payable annually or such shorter period if payable
in more frequent installments). For the purpose of this computation, the month
in which such last preceding installment of premiums or Impositions became due
and payable and the month in which the Closing Date occurs shall be included and
deemed to have elapsed. During each month thereafter, Mortgagors shall pay with
respect to the Mortgage Escrow Amounts a sum equal to one-twelfth of such
insurance premiums and such Impositions for the then-current insurance period
and tax year, so that as each installment of such premiums and Impositions shall
become due and payable, Mortgagors shall have paid to Mortgagee a sum sufficient
to pay the same. If the amount of such premiums and Impositions has
33
not been definitely ascertained at the time when any such monthly deposits are
to be paid, Mortgagors shall pay Mortgage Escrow Amounts based upon the amount
of such premiums and Impositions for the preceding year, subject to adjustment
as and when the amount of such premiums and Impositions are ascertained.
(b) The Mortgage Escrow Amounts shall be held by Mortgagee and shall be
applied to the payment of the obligations in respect of which such Mortgage
Escrow Amounts were retained in accordance with the Cash Collateral Agreement
except upon the occurrence of an Event of Default and the acceleration of the
Notes in which case all or any portion of such Mortgage Escrow Amounts may be so
transferred or otherwise applied to the Indebtedness in such order or priority
as Mortgagee may elect or Mortgagee may exercise any of its rights or remedies
with respect to same hereunder, at law or in equity. Any Mortgage Escrow Amounts
paid to Mortgagee in excess of the actual obligations for which they were
retained, shall be held and credited to the obligations of the Mortgagors
pursuant to paragraph (a) above for the ensuing year or shorter period if
applicable. Nothing herein contained shall be deemed to affect any right or
remedy of Mortgagee under this Mortgage or otherwise at law or in equity to pay
any such amount and to add the amount so paid to the Indebtedness hereby
secured. Any such application of said amounts or any portion thereof to any
Indebtedness secured hereby shall not be construed to cure or waive any Default
or notice of Default hereunder or invalidate any act done pursuant to any such
Default or notice.
(c) Mortgagors shall deliver to Mortgagee all tax bills, bond and
assessment statements, statements of insurance premiums, and statements for any
other obligations referred to above as soon as the same are received by
Mortgagors and Mortgagee shall cause the same to be paid when due to the extent
of Mortgage Escrow Amounts available therefor. It is expressly acknowledged and
agreed that Mortgagee shall have no obligation whatsoever to advance any amounts
in payment of all or any portion of such obligations to the extent that Mortgage
Escrow Amounts paid are insufficient to pay any such obligations as and when the
same become due.
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9. Transfers, Additional Indebtedness and Subordinate Liens.
(a) Except as otherwise permitted under Section 2.9 of the Credit Agreement
and Section 49 hereof, Mortgagors shall not sell or otherwise Transfer any
interest in all or any part of the Properties.
(b) Except as otherwise permitted under Sections 2.8(e) and 5.9 of the
Credit Agreement, there shall be no Transfer of any direct or indirect
beneficial ownership interest in (i) either Mortgagor as the same exists as of
the date hereof or any of the partners of the Lower Tier LP or the Upper Tier
LP, as the same exists as of the date hereof, (ii) either General Partner as the
same exists as of the date hereof or (iii) the REIT as the same exists as of the
date hereof, without the consent of the Super Required Lenders which may be
withheld or granted in their sole and absolute discretion.
(c) Mortgagors shall comply at all times and in all respects with the terms
and provisions of Sections 5.9 and 5.10 of the Credit Agreement.
(d) Any Transfer made in violation of the foregoing provisions shall be an
immediate Event of Default hereunder and shall be void and of no force or effect
as against Mortgagee. Upon any such Transfer made in violation of Section 9(a),
Mortgagee may, at its option and without limiting any other right or remedy
available to Mortgagee hereunder, under any of the other Loan Documents, or
otherwise at law or in equity, accelerate the maturity of the Notes and require
the payment of the then existing outstanding principal balance, accrued interest
and all other Indebtedness due under the Notes and this Mortgage and any and all
other amounts due to Mortgagee. Mortgagors shall reimburse Mortgagee for all
reasonable costs and expenses, including, without limitation, reasonable
attorneys' fees, actually incurred by Mortgagee in connection with the review by
Mortgagee of Mortgagors' request for Mortgagee's consent to a Transfer of all or
any portion of the Mortgaged Property or any interest therein or any interest in
Mortgagors.
35
10. Maintenance of Mortgaged Property; Alter- ations; Inspection;
Utilities.
(a) Mortgagors shall keep and maintain the Mortgaged Property and every
part thereof in good condition and repair, subject to casualty and ordinary wear
and tear, and shall not permit or commit any impairment, deterioration (other
than through ordinary wear and tear) or intentional waste of the Mortgaged
Property and the Equipment located thereon. Mortgagors further covenant to do
all other acts which from the character or use of the Mortgaged Property may be
reasonably necessary to protect the security hereof, the specific enumerations
herein not excluding the general. Mortgagors shall not remove or demolish any
Improvement on the Mortgaged Property except as the same may be necessary in
connection with an Alteration or a restoration in connection with a Taking or
casualty, or in the ordinary course of business in accordance with the terms and
conditions hereof.
(b) Except as may be necessary in connec- tion with an Alteration permitted
by Section 10(c) below, Mortgagors shall not make any changes or allow any
changes to be made in the use of the Mortgaged Property as first-class
institutional office buildings including retail space and other ancillary uses
or initiate or acquiesce in any change in any zoning or other land use
classification affecting all or any portion of the Mortgaged Property now or
hereafter in effect and affecting all or any portion thereof.
(c) Provided that no Event of Default shall have occurred and be continuing
hereunder and subject to the provisions of the Credit Agreement, Mortgagors
shall have the right, without Mortgagee's consent, to undertake any alteration,
improvement, demolition or removal (any such alteration, improvement, demolition
or removal, an "Alteration") of its respective Property or any portion thereof
so long as any such Alteration is (i) required pursuant to or in connection with
any Lease or (ii) is not a Major Alteration. If either Mortgagor desires to
perform a Major Alteration to its respective Mortgaged Property then such
Mortgagor shall (i) obtain the Agent's consent which shall not be unreasonably
withheld and (ii) comply with the provisions of Section 5.19 of the Credit
Agreement.
36
(d) Mortgagee and any Persons authorized by them may at all reasonable
times and upon reasonable notice enter and examine the Mortgaged Property and
may inspect all work done, labor performed and materials furnished in and about
the Mortgaged Property subject in all instances to the rights of tenants under
Leases. Mortgagee shall not have any duty to make any such inspection and shall
not have any liability or obligation for making or not making any such
inspection.
11. Legal Compliance; Compliance with Covenants and Easements. Mortgagors
and the Mortgaged Property and the Equipment thereon and the use thereof comply
with all Legal Requirements (hereinafter defined). Subject to Mortgagors' right
of contest pursuant to Section 7(c), Mortgagors shall comply with and conform in
all material respects to all present and future laws, statutes, codes,
ordinances, orders, judgments, decrees, injunctions, rules, regulations and
requirements, and irrespective of the nature of the work to be done, of every
Governmental Authority including, without limitation, Environmental Laws,
consumer protection laws and all covenants, restrictions and conditions now or
hereafter of record which may be applicable to it or to the Mortgaged Property
and the Equipment thereon, or to the use, manner of use, occupancy, possession,
operation, maintenance, alteration, repair or reconstruction of the Mortgaged
Property and the Equipment thereon including, without limitation, building and
zoning codes and ordinances and the provisions of the Americans with
Disabilities Act (collectively, the "Legal Requirements"). Each Mortgagor shall
comply with the requirements of all, and shall not modify, amend or terminate
any, easements and restrictive covenants which from time to time affect the
whole or any portion of the Mortgaged Property. Each Mortgagor shall also comply
with the requirements of, and to the extent reasonably within such Mortgagor's
control, maintain, preserve, enforce and renew, all rights of way, easements,
grants, privileges, licenses, franchises and restrictive covenants which from
time to time benefit or pertain to the whole or any portion of the Mortgaged
Property, and Mortgagors shall not modify, amend or terminate, or surrender any
of its rights under, any of such rights of way, easements, grants, privileges,
licenses, franchises or restrictive covenants. Each Mortgagor will not, without
obtaining the prior written consent of the Mortgagee, initiate, join in or
consent to any new private restrictive covenant, zoning ordinance,
37
or other public or private restrictions, limiting or affecting the uses which
may be made of the Mortgaged Property or any part thereof.
12. Books and Records, Financial Statements, Reports and Other Information.
(a) Books and Records. Mortgagors will keep and maintain on a fiscal year
basis proper books and records, in which accurate and complete entries shall be
made of all dealings or transactions of or in relation to the Notes and the
Mortgaged Property and the business and affairs of Mortgagors relating to the
Mortgaged Property, in accordance with GAAP and the Credit Agreement. Mortgagee
and its authorized representatives shall have the right at reasonable times and
upon reasonable notice to examine the books and records of Mortgagors relating
to the operation of the applicable Mortgaged Property and to make such copies or
extracts thereof as Mortgagee may reasonably require.
(b) Other Information. Mortgagors will, within a reasonable time after
written request by Mortgagee, furnish or cause to be furnished to Mortgagee, in
such manner and in such detail as may be reasonably requested by Mortgagee, such
reasonable additional information which has been prepared by Mortgagors and/or
the Manager, the Asset Manager or the Leasing Agent in the ordinary course of
business, as may be requested by Mortgagee with respect to the Mortgaged
Property.
13. Compliance with Leases and Agreements.
(a) (i) To the best knowledge of each Mortgagor, the Leases are in full
force and effect, (ii) Mortgagors have neither given to, nor received any
written notice of default from, any Tenants under any Leases and (iii) to the
best knowledge of each Mortgagor, except as described in the estoppel
certificates delivered to Agent on or before the date hereof, no events or
circumstances exist which with or without the giving of notice, the passage of
time or both, may constitute a default under any of the Leases. Mortgagors will
promptly notify Mortgagee upon the occurrence of any of the foregoing events.
(b) Mortgagors shall, at all times, lease the Mortgaged Property in a
first-class manner consistent
38
with other first-class institutional office buildings in the City of New York.
All Major Leases entered into after the date hereof shall be subject to the
prior written approval of Mortgagee in accordance with the terms of the Credit
Agreement. Each Lease entered into after the date hereof, regardless of whether
it is a Major Lease (including the renewal or extension on or after the date
hereof of any Lease or Major Lease entered into prior to the date hereof if the
rent payable during such renewal or extension, or a formula to compute such
rent, is not provided for in such Lease, such a renewal or extension a "Renewal
Lease") (A) shall comply with the provisions of Section 5.20 of the Credit
Agreement, and (B) shall otherwise comply with the requirements of the Credit
Agreement applicable thereto.
(c) Mortgagors shall (i) promptly perform and observe all of the material
terms, covenants and conditions required to be performed and observed by
Mortgagors under the applicable Leases; and (ii) collect the Rents under the
Leases when due and collect escalations, percentage rent and other charges in
accordance with the terms of each Lease, subject to the terms of the Cash
Collateral Agreement.
(d) All Leases entered into by Mortgagors after the date hereof shall be
subject and subordinate to this Mortgage, and shall provide that the Tenant
thereunder shall attorn to Mortgagee or any other Person succeeding to the
interest of Mortgagee, on the terms set forth in Section 13(e). All reasonable
actual, out-of-pocket costs and expenses of Mortgagee in connection with the
negotiation, preparation, execution and delivery of any nondisturbance agreement
including, without limitation, reasonable attorneys' fees and disbursements,
shall be paid by Mortgagors.
(e) Except as otherwise approved by Agent, each Lease entered into from and
after the date hereof shall provide that: in the event of the enforcement by
Mortgagee of any remedy under this Mortgage, the Tenant under such Lease shall,
at the option of Mortgagee or of any other Person succeeding to the interest of
Mortgagee as a result of such enforcement, attorn to Mortgagee or to such Person
and shall recognize Mortgagee or such successor in interest as lessor under such
Lease without change in the provisions thereof; provided, however, Mortgagee or
such successor in interest shall
39
not be liable for or bound by (i) any payment of an installment of rent or
additional rent which may have been made more than thirty (30) days before the
due date of such installment, (ii) any amendment or modification to or
termination of any such Lease not consented to by Mortgagee, (iii) any act or
omission of or default by Mortgagors under any such Lease, provided that any
successor will be responsible for any default under such Lease from and after
the date such successor succeeds to the interest of lessor, (iv) any credits,
claims, setoffs or defenses which any Tenant may have against Mortgagors or (v)
any security deposits unless actually received. Each such Tenant, upon
reasonable request by Mortgagee or such successor in interest, shall execute and
deliver an instrument or instruments confirming such attornment.
14. Mortgagee's Right to Perform. Upon the occurrence and continuance of an
Event of Default with respect to the performance of any of the Obligations
contained herein, Mortgagee, without waiving or releasing Mortgagors from any
Obligation or Default under this Mortgage, after delivery of notice thereof to
Mortgagors, may (but shall not be obligated to), at any time perform the same,
and the cost thereof, with interest at the Default Rate from the date of payment
by Mortgagee to the date such amount is paid by Mortgagors shall immediately be
due from Mortgagors to 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 Mortgagee under this
Section 14 shall be deemed or construed to cure Mortgagors' Default or waive any
right or remedy of Mortgagee hereunder.
15. Mortgagors' Existence; Organization and Authority. Each Mortgagor shall
do all things necessary to preserve and keep in full force and effect its
existence, franchises, rights and privileges as a limited partnership and its
right to own property or transact business in the State of New York. In addition
to the representations and warranties stated elsewhere in this Mortgage, each
Mortgagor hereby represents and warrants that it (a) is a duly organized and
validly existing limited partnership, (b) has the power and authority to own its
properties and to carry on its business as now being conducted and as proposed
to be conducted hereunder and is qualified to do business in the State of New
York,
40
and (c) has the power to execute and deliver and perform its obligations under
this Mortgage, the Notes and each Loan Document executed by it. The execution
and delivery by each Mortgagor of this Mortgage, the Notes and each of the other
Loan Documents, each Mortgagor's performance of its respective obligations
thereunder and the creation of the security interest and Liens provided for in
this Mortgage and the other Loan Documents have been duly authorized by all
requisite action on the part of each Mortgagor where required, and will not
violate in any material respect any Legal Requirement, any order of any court or
other Governmental Authority, the partnership agreement of each Mortgagor, or
any other instrument to which each Mortgagor is a party, or by which each
Mortgagor is bound, or be in conflict with, result in a breach of, or constitute
(with due notice or lapse of time or both) a default under, or result in the
creation or imposition of any Lien, of any nature whatsoever, upon any of the
property or assets of each Mortgagor except the Liens created hereunder and
under the other Loan Documents. Each Mortgagor is not required to obtain any
consent, approval or authorization from or to file any declaration or statement
with, any Governmental Authority or other agency in connection with or as a
condition to the execution, delivery or performance of this Mortgage, the Notes
or the other Loan Documents other than that which have been already obtained or
filed.
16. Protection of Security; Costs and Expenses. Mortgagors shall appear in
and defend any action or proceeding purporting to affect the security hereof or
the rights or powers of Mortgagee hereunder and shall pay all costs and
expenses, including, without limitation, cost of evidence of title and
reasonable attorneys' fees and disbursements, in any such action or proceeding
in which Mortgagee may appear, and in any suit brought by Mortgagee to foreclose
this Mortgage or to enforce or establish any other rights or remedies of
Mortgagee hereunder. If an Event of Default occurs and is continuing under this
Mortgage, or if any action or proceeding is commenced in which it becomes
necessary to defend or uphold the Lien or priority of this Mortgage or which
adversely affects Mortgagee's interest in the Mortgaged Property, or any part
thereof, including, but not limited to, eminent domain, enforcement of, or
proceedings of any nature whatsoever under any Legal Requirement affecting the
Mortgaged Property or involving either of Mortgagor's bankruptcy, insolvency,
arrangement, reorganization or
41
other form of debtor relief, then Mortgagee, upon reasonable notice to
Mortgagors, may, but without obligation to do so and without releasing
Mortgagors from any obligation hereunder, may make such appearances, disburse
such sums and take such action as Mortgagee deems necessary or appropriate to
protect Mortgagee's interest in the Mortgaged Property, including, but not
limited to, disbursement of reasonable attorneys' fees, entry upon the Mortgaged
Property to make repairs or take other action to protect the security hereof,
and payment, purchase, contest or compromise of any encumbrance, charge or lien
which in the judgment of Mortgagee appears to be prior or superior hereto.
Mortgagors jointly and severally further agree to pay all reasonable costs and
expenses of Mortgagee including, without limitation, reasonable fees and
disbursements of Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ or, with respect to clause
(b) only, any other counsel of Mortgagee in connection with (a) the negotiation,
preparation, execution and delivery of this Mortgage, the Notes and the other
Loan Documents, and (b) the performance of their respective obligations and
exercise of their respective rights under this Mortgage, the Notes, the Credit
Agreement or the other Loan Documents; provided that Mortgagors, for so long as
an Event of Default or any event which has a Material Adverse Effect has not
occurred and is continuing, shall be responsible, but not more than once in any
twenty-four (24) month period with respect to each Property, for the reasonable
costs payable to third parties with respect to future appraisals (or, if
appropriate only updates of previous appraisals) and other reports required
prior time to time in accordance with Agent's policies, as set in accordance
with regulatory requirements. All of the costs, expenses and amounts set forth
in this Section 16 shall be payable by Mortgagors on demand, together with
interest thereon at the rate then in effect with respect to the Notes (except
during the continuance of an Event of Default in which case interest shall
accrue at the Default Rate), from the date of any such payment by Mortgagee
until the date of repayment by Mortgagors shall be deemed to be Indebtedness
hereunder and shall be a Lien on the Mortgaged Property prior to any right,
title, interest or claim upon the Mortgaged Property. Nothing contained in this
Section 16 shall be construed to require Mortgagee to incur any expense, make
any appearance, or take any other action.
42
17. Management of the Mortgaged Property.
(a) Mortgagors covenant and agree with Mortgagee that the Mortgaged
Property will be managed at all times in a manner consistent with past practice
by the Manager pursuant to the Property Management Agreement or by another
manager reasonably acceptable to Mortgagee. Mortgagors covenant to comply in all
material respects with the Property Management Agreement and the Asset
Management Agreement as in force as of the date hereof. No material amendment to
the Property Management Agreement or the Asset Management Agreement which could
have a Material Adverse Effect may be made without Mortgagee's and the Required
Lender's written consent, which shall not be unreasonably withheld or delayed.
Upon the replacement of the Manager with a new manager, Mortgagee shall have the
right to approve (which approval shall not be unreasonably withheld or delayed)
any new management agreement with such manager, but only to the extent such new
agreement is materially different from the Property Management and Leasing
Agreement and such material difference would have a Material Adverse Effect.
Upon the replacement of the Manager in its capacity as leasing agent for the
Properties, Mortgagee shall have the right to approve (which approval shall not
be unreasonably withheld or delayed) any new leasing agency agreement with such
agent, but only to the extent such new agreement is materially different from
the Property Management and Leasing Agreement and such material difference would
have a Material Adverse Effect. Upon the replacement of the Asset Manager,
Mortgagee shall have the right to approve (which approval shall not be withheld
or delayed) any new asset management agreement with such asset manager but only
to the extent such new agreement is materially different from the Asset
Management Agreement and such material difference would have a Material Adverse
Effect.
(b) It is acknowledged and agreed that the Property Management Agreement
may be terminated at the direction of Mortgagee at any time following the
occurrence and continuance of an Event of Default hereunder, provided that
Lenders shall have appointed a receiver for the Properties, foreclosed upon the
Properties, accepted a deed in lieu of foreclosure, or have otherwise elected to
become a mortgagee in possession or taken control of the operation of the
Properties, pursuant to the Consent and Subordination of Property Management
Agreement and, if the Property Management Agreement is so terminated, a
substitute Manager and a substitute Leasing
43
Agent shall be appointed by Mortgagors subject to the prior written consent of
Mortgagee, or, if any Event of Default shall be continuing, by Mortgagee.
(c) It is acknowledged and agreed that the Asset Management Agreement may
be terminated at the direction of Mortgagee at any time following the occurrence
and continuance of an Event of Default hereunder, pursuant to the Consent and
Subordination of Asset Management Agreement and, if the Asset Management
Agreement is so terminated, a substitute Asset Manager may be appointed by the
REIT subject to the prior written consent of Mortgagee.
(d) Mortgagee shall have the rights to terminate the Asset Management
Agreement set forth in the Consent and Subordination of Asset Management
Agreement.
(e) Mortgagee shall have the rights to terminate the Property Management
Agreement set forth in the Consent and Subordination of Property Management
Agreement.
18. Environmental Matters.
(a) Each Mortgagor hereby represents and warrants that except as set forth
in the Environmental Reports delivered to Mortgagee prior to the Closing Date
(i) to the best of each Mortgagor's knowledge, Mortgagors (x) are in compliance
in all material respects with all applicable Environmental Laws, (y) have all
material permits, licenses, approvals, rulings, variances, exemptions or other
authorizations under applicable Environmental Laws to operate the Mortgaged
Property as presently conducted or as reasonably anticipated to be conducted,
(z) has received no written communication, from a Governmental Authority or any
other Person, alleging that Mortgagors are not in full compliance with all
Environmental Laws, and there are no events or circumstances, to Mortgagors'
knowledge, that may prevent or interfere with such full compliance in the
future, (ii) there is no Environmental Claim pending or, to Mortgagors'
knowledge, threatened against Mortgagors, (iii) to Mortgagors' knowledge, there
are no past or present actions, activities, circumstances, conditions, events or
incidents including, without limitation, the release, emission, discharge or
disposal of any Hazardous Substance, that could form the basis of any
Environmental Claim against
44
Mortgagors, (iv) without in any way limiting the generality of the foregoing and
except as disclosed in the Environmental Reports (A) there are no sites on the
Mortgaged Property in which Mortgagors have stored (except in full compliance
with Environmental Laws) disposed or arranged for the disposal of Hazardous
Substances, (B) there are no underground storage tanks located on the Mortgaged
Property, (C) there is no asbestos contained in or forming a part of any
Improvement on the Mortgaged Property, and (D) no polychlorinated biphenyls
(PCBs) are used or stored on the Mortgaged Property.
(b) Each Mortgagor covenants and agrees with Mortgagee that it shall comply
and shall cause all tenants or other occupants of the Mortgaged Property to
comply, in all respects with all Environmental Laws, and will not permit any
tenant or other occupant of the Mortgaged Property to generate, store, handle,
process, dispose of or otherwise use, Hazardous Materials at, in, on, or about
the Mortgaged Property, in a manner that could lead or potentially lead to the
imposition on Mortgagors, Mortgagee or the Mortgaged Property of any liability
or lien of any nature whatsoever under any Environmental Law; provided that
Tenants may use, handle and store such materials as is customary in the
operation of a first-class office building in Manhattan in accordance with their
Leases and all Environmental Laws. Mortgagors shall notify Mortgagee promptly in
the event of any spill or other release of any Hazardous Substance at, in, on,
under or about the Mortgaged Property which is required to be reported to a
Governmental Authority under any Environmental Law, will promptly forward to the
Mortgagee copies of any notices received by Mortgagors relating to alleged
violations of any Environmental Law or any potential liability under any
Environmental Law and will, subject to Section 7(c) hereof, promptly pay when
due any fine or assessment against Mortgagee, Mortgagors or the Mortgaged
Property relating to any Environmental Law. If at any time it is it is
determined that the operation or use of the Mortgaged Property is in violation
of any applicable Environmental Law or that there are Hazardous Substances
located at, in, on, under or about the Mortgaged Property which, under any
Environmental Law, require special handling in collection, storage, treatment or
disposal, or any form of cleanup or corrective action, Mortgagors shall, within
thirty (30) days after receipt of notice thereof from any Governmental Authority
or from Mortgagee, take, at Mortgagors'
45
sole cost and expense, such actions as may be necessary to fully comply in all
respects with all Environmental Laws, provided, however, that if such compliance
cannot reasonably be completed within such thirty (30) day period, Mortgagors
shall commence such necessary action within such thirty (30) day period and
shall thereafter diligently and expeditiously proceed to fully comply in all
respects and in a timely fashion with all Environmental Laws.
(c) If Mortgagors fail to timely take, or to diligently and expeditiously
proceed to complete in a timely fashion, any such action described in clause (b)
above, Mortgagee may, in its sole and absolute discretion, make upon prior
notice to the Mortgagors advances or payments toward the performance or
satisfaction of the same, but shall in no event be under any obligation to do
so. All sums so advanced or paid by Mortgagee (including, without limitation,
reasonable counsel and consultant fees and expenses, investigation and
laboratory fees and expenses, and fines or other penalty payments) and all sums
advanced or paid in connection with any judicial or administrative investigation
or proceeding relating thereto, will immediately, upon demand, become due and
payable from Mortgagors and shall bear interest at the Default Rate from the
date any such sums are so advanced or paid by the Mortgagee until the date any
such sums are repaid by Mortgagors to the Mortgagee. Mortgagors will execute and
deliver, promptly upon request, such instruments as the Mortgagee may deem
useful or necessary to permit the Mortgagee to take any such action as the
Mortgagee may require to secure all sums so advanced or paid by the Mortgagee.
If a lien is filed against the Mortgaged Property by any Governmental Authority
resulting from the need to expend or the actual expending of monies arising from
an action or omission, whether intentional or unintentional, of Mortgagors or
for which either Mortgagor is responsible, resulting in the releasing, spilling,
leaking, leaching, pumping, emitting, pouring, emptying or dumping of any
Hazardous Substance into the waters or onto land located within or without the
State where the Mortgaged Property is located, then Mortgagors will, within
thirty (30) days from the date that Mortgagors are first given notice that such
lien has been placed against the Mortgaged Property (or within such shorter
period of time as may be specified by Mortgagee if such Governmental Authority
has commenced steps to cause the Mortgaged Property to be sold pursuant to
46
such lien), either (a) pay the claim and remove the lien, or (b) furnish a cash
deposit, bond, or such other security with respect thereto as is satisfactory in
all respects to Mortgagee and is sufficient to effect a complete discharge of
such lien on the Mortgaged Property.
(d) Mortgagee may, at its option, at intervals of not less than one year,
or more frequently if Mortgagee reasonably believes that a Hazardous Substance
or other environmental condition violates or threatens to violate any
Environmental Law, cause an environmental audit of the Mortgaged Property or
portions thereof to be conducted to confirm Mortgagors' compliance with the
provisions of this paragraph, and Mortgagors shall cooperate in all reasonable
ways with Mortgagee in connection with any such audit. If such audit discloses
that a violation of or a liability under an Environmental Law exists or if such
audit was required or prescribed by law, regulation or governmental or
quasi-governmental authority, Mortgagors shall pay all reasonable costs and
expenses incurred in connection with such audit; otherwise, the costs and
expenses of such audit shall, notwithstanding anything to the contrary set forth
in this paragraph, be paid by the Mortgagee.
(e) If this Mortgage is foreclosed, or if the Mortgaged Property is sold
pursuant to the provisions of this Mortgage, or if Mortgagors tender a deed or
assignment in lieu of foreclosure or sale, Mortgagors shall deliver the
Mortgaged Property to the purchaser at foreclosure or sale or to the Mortgagee,
its nominee, or wholly-owned subsidiary, as the case may be, in a condition that
complies in all respects with all Environmental Requirements.
(f) Each Mortgagor will defend, indemnify, and hold harmless Mortgagee, its
co-lenders, participants, employees, agents, officers, and directors, from and
against any and all claims, demands, penalties, causes of action, fines,
liabilities, settlements, damages, costs, or expenses of whatever kind or
nature, known or unknown, foreseen or unforeseen, contingent or otherwise
(including, without limitation, reasonable counsel and consultant fees and
expenses, investigation and laboratory fees and expenses, court costs, and
litigation expenses) arising out of, or in any way related to, (i) any breach by
either Mortgagor of any of the provisions of this
47
Section 18, (ii) the presence, disposal, spillage, discharge, emission, leakage,
release, or threatened release of any Hazardous Substance which is at, in, on,
under, from or affecting the Mortgaged Property, including, without limitation,
any damage or injury resulting from any such Hazardous Substance to or affecting
the Mortgaged Property or the soil, water, air, vegetation, buildings, personal
property, persons or animals located on the Mortgaged Property or on any other
property or otherwise, (iii) any personal injury (including wrongful death) or
property damage (real or personal) arising out of or related to any such
Hazardous Substance, (iv) any lawsuit brought or threatened, settlement reached,
or order or directive of or by any Governmental Authority relating to such
Hazardous Substance, or (v) any violation of any Environmental Law or any policy
or requirement of Mortgagee hereunder, in each case to the extent not resulting
from the willful misconduct or gross negligence of such indemnified parties.
(g) Notwithstanding anything to the con- trary provided in this Mortgage or
in any other Loan Document, the indemnification provided in Section 18(f) hereof
shall be fully recourse to Mortgagors, constitute the personal recourse
undertakings, obligations and liabilities of the Mortgagors, and shall be
independent of, and shall survive, the discharge of the Indebtedness, the
release of the Lien created under this Mortgage, and/or the conveyance of title
to the Mortgaged Property to Mortgagee or any purchaser or designee in
connection with a foreclosure of this Mortgage or conveyance in lieu of
foreclosure; provided, that in the case of any foreclosure or a deed or
assignment in lieu of such foreclosure such indemnity shall exclude Hazardous
Substances placed on the Mortgaged Property after the date of such foreclosure
or deed in lieu thereof. Notwithstanding the foregoing, in no event shall this
indemnity be assignable by Mortgagee to any such purchaser at or subsequent to a
foreclosure sale.
19. Remedies. Upon the occurrence and continuance of an Event of Default,
Mortgagee may take such actions against Mortgagors and/or against the Mortgaged
Property or any portion thereof as Mortgagee determines is necessary to protect
and enforce its rights hereunder, without notice or demand except as set forth
below. Any such actions taken by Mortgagee shall be cumulative and concurrent
and may be pursued independently, singly,
48
successively, together or otherwise, at such time and in such order as Mortgagee
may determine in its sole discretion, to the fullest extent permitted by law,
without impairing or otherwise affecting the other rights and remedies of
Mortgagee permitted by law, equity or contract or as set forth herein or in the
other Loan Documents. Such actions may include the following:
(a) Acceleration. Subject to any appli- cable provisions of the Notes, the
Credit Agreement and the other Loan Documents, Mortgagee may declare all or any
portion of the unpaid principal balance under the Notes, together with all
accrued and unpaid interest thereon, and all other unpaid Indebtedness, to be
immediately due and payable.
(b) Entry. Mortgagee, personally, or by its agents or attorneys, may enter
into and upon all or any part of the Mortgaged Property, and may exclude
Mortgagors, their agents and servants (including the Manager) therefrom; and,
Mortgagee, having and holding the same, may use, operate, manage and control the
Mortgaged Property or any part thereof and conduct the business thereof, either
personally or by its superintendents, managers, agents, servants, attorneys or
receiver. Upon every such entry, Mortgagee may, at the expense of the Mortgaged
Property or Mortgagors, from time to time, either by purchase, repair or
construction, maintain and restore the Mortgaged Property or any part thereof,
and may insure and reinsure the same in such amount and in such manner as may
seem to them to be advisable. Similarly, from time to time, Mortgagee may, at
the expense of the Mortgaged Property or Mortgagors make all necessary or proper
repairs, renewals, replacements, alterations, additions, betterments and
improvements to and on the Mortgaged Property or any part thereof as it may seem
advisable. Mortgagee shall also have the right to manage and operate the
Mortgaged Property or any part thereof and to carry on the business thereof and
exercise all rights and powers of Mortgagors with respect thereto, either in the
name of Mortgagors or otherwise, as may seem to them to be advisable. In
confirmation of GRANTING CLAUSE IV, in the case of the occurrence and
continuation of an Event of Default, Mortgagee shall be entitled to collect and
receive all Rents to be applied in the order of priorities and amounts as
Mortgagee shall elect in its sole discretion. In the event Mortgagee elects, in
its sole discretion, to apply the Rents to any matter
49
provided herein or in the other Loan Documents, Mortgagee shall not have cause
to claim that the Rents so applied by Mortgagee were misappropriated by
Mortgagors. Mortgagee, shall be liable to account only for rents, issues and
profits and other proceeds actually received by Mortgagee.
(c) Foreclosure. (i) Mortgagee, with or without entry, personally or by its
agents or attorneys, insofar as applicable, may (i) sell to the extent permitted
by law and pursuant to the power of sale granted herein, all and singular the
Mortgaged Property, and all estate, right, title and interest, claim and demand
therein, and right of redemption thereof, at one or more sales, as an entirety
or in parcels, and at such times and places as required or permitted by law and
as are customary in any county or parish in which the Mortgaged Property is
located and upon such terms as Mortgagee may fix and specify in the notice of
sale to be given to Mortgagors (and on such other notice published or otherwise
given as provided by law), or as may be required by law; (ii) institute
proceedings for the complete or partial foreclosure of this Mortgage under the
provisions of the laws of the State of New York, or under any other applicable
provision of law; or (iii) take all steps to protect and enforce the rights of
Mortgagee, whether by action, suit or proceeding in equity or at law (for the
specific performance of any covenant, condition or agreement contained in this
Mortgage, or in aid of the execution of any power herein granted, or for any
foreclosure hereunder, or for the enforcement or any other appropriate legal or
equitable remedy), or otherwise, as Mortgagee, being advised by counsel and its
financial advisor, shall deem most advisable to protect and enforce any of their
rights or duties hereunder. Mortgagee may conduct any number of sales from time
to time. The power of sale shall not be exhausted by any one or more such sales
as to any part of the Mortgaged Property remaining unsold, but shall continue
unimpaired until the entire Mortgaged Property shall have been sold.
(d) Specific Performance. Mortgagee, in its sole and absolute discretion
may (but subject to the provisions of Section 9.14 of the Credit Agreement)
institute an action, suit or proceeding at law or in equity for the specific
performance of any covenant, condition or agreement contained herein or in the
Notes or any other Loan Document, or in aid of the execution of
50
any power granted hereunder or for the enforcement of any
other appropriate legal or equitably remedy.
(e) Enforcement of Notes. Mortgagee may recover judgement on the Notes (or
any portion of the Indebtedness evidenced thereby), either before, during or
after any proceedings for the foreclosure (or partial foreclosure) or
enforcement of this Mortgage.
(f) Sale of Mortgaged Property; Applica- tion of Proceeds.
(i) Mortgagee may postpone any sale of all or any part of the
Mortgaged Property to be made under or by virtue of this Section 19 by
public announcement at the time and place of such sale, or by
publication, if required by law, and, from time to time, thereafter,
may further postpone such sale by public announcement made at the time
of sale fixed by the preceding postponement.
(ii) Upon the completion of any sale made by Mortgagee under or
by virtue of this Section 19, Mortgagee shall execute and deliver to
the accepted purchaser or purchasers a good and sufficient deed or
deeds or other appropriate instruments, conveying, assigning and
transferring all its estate, right, title and interest in and to the
property and rights so sold. Mortgagee is hereby appointed the true
and lawful irrevocable attorney-in-fact of Mortgagors in their name
and ▇▇▇▇▇ or in the name of Mortgagee to make all necessary
conveyances, assignments, transfers and deliveries of the property and
rights so sold, and, for that purpose, Mortgagee may execute all
necessary deeds and other instruments of assignment and transfer, and
may substitute one or more persons with like power, Mortgagors hereby
ratifying and confirming all that such attorney or attorneys or such
substitute or substitutes shall lawfully do by virtue hereof.
Mortgagors shall, nevertheless, if so requested in writing by
Mortgagee, ratify and confirm any such sale or sales by executing and
delivering to Mortgagee or to such purchaser or purchasers all such
instruments as may be advisable, in the judgment of Mortgagee, for
such purposes and as may be designated in such request. Any such sale
or sales made under or by virtue of this Section 19 shall operate
51
to divest all the estate, right, title, interest, claim and demand,
whether at law or in equity, of Mortgagors in and to the property and
rights so sold, and shall be a perpetual bar, at law and in equity, of
Mortgagors in and to the property and rights so sold, and shall be a
perpetual bar, at law and in equity, against Mortgagors, its successors
and assigns and any Person claiming through or under Mortgagors and
their successors and assigns.
(iii) The receipt of Mortgagee for the purchase money paid as a
result of any such sale shall be a sufficient discharge therefor to
any purchaser of the property or rights, or any part thereof, so sold.
No such purchaser, after paying such purchase money and receiving such
receipt, shall be bound to see to the application of such purchase
money upon or for any trust or purpose of this Mortgage, or shall be
answerable, in any manner, for any loss, misapplication or
non-application of any such purchase money or any part thereof, nor
shall any such purchaser be bound to inquire as to the authorization,
necessity, expediency or regularity of such sale.
(iv) Upon any sale made under or by virtue of this Section 19,
Mortgagee may bid for and acquire the Mortgaged Property or any part
thereof and, in lieu of paying cash therefor, may make settlement for
the purchase price by crediting upon the Notes secured by this
Mortgage the net proceeds of sale, after deducting therefrom the
expense of the sale and the costs of the action and any other sums
which Mortgagee is authorized to deduct under this Mortgage. The
person making such sale shall accept such settlement without requiring
the production of the Notes or this Mortgage, and without such
production there shall be deemed credited to the Indebtedness and
Obligations under this Mortgage the net proceeds of such sale.
Mortgagee, upon acquiring the Mortgaged Property or any part thereof
shall be entitled to own, hold, lease, rent, operate, manage or sell
the same in any manner permitted by applicable laws.
(g) Voluntary Appearance; Receivers. After the happening, and during the
continuance of, any Event of Default, and immediately upon commencement of
52
(i) any action, suit or other legal proceeding by Mortgagee to obtain judgment
for the principal and interest on the Notes and any other sums required to be
paid pursuant to this Mortgage, or (ii) any action, suit or other legal
proceeding by Mortgagee of any other nature in aid of the enforcement of the
Loan Documents or any of them, Mortgagors will (a) enter their voluntary
appearance in such action, suit or proceeding, and (b) if required by Mortgagee,
consent to the appointment of one or more receivers of the Mortgaged Property
and of the earnings, revenues, rents, issues, profits and income thereof. After
the happening and during the continuance of any Event of Default, or upon the
filing of a ▇▇▇▇ in equity to foreclose this Mortgage or to enforce the specific
performance hereof or in aid thereof, or upon the commencement of any other
judicial proceeding to enforce any right of Mortgagee, Mortgagee shall be
entitled, as a matter of right, if they shall so elect, without notice to any
other party and without regard to the adequacy of the security of the Mortgaged
Property, forthwith, either before or after declaring the principal and interest
on the Notes to be due and payable, to the appointment of such a receiver or
receivers. Any receiver or receivers so appointed shall have such powers as a
court or courts shall confer, which may include, without limitation, any or all
of the powers which Mortgagee is authorized to exercise by the provisions of
this Section 19, and shall have the right to incur such obligations and to issue
such certificates therefor as the court shall authorize.
(h) Retention of Possession. Notwith- standing the appointment of any
receiver, liquidator or trustee of Mortgagors, or any of their property, or of
the Mortgaged Property or any part thereof, Mortgagee, to the extent permitted
by law, shall be entitled to retain possession and control of all property now
or hereafter granted to or held by Mortgagee under this Mortgage.
(i) Suits by Mortgagee. All rights of action under this Mortgage may be
enforced by Mortgagee without the possession of the Notes and without the
production thereof or this Mortgage at any trial or other proceeding relative
thereto. Any such suit or proceeding instituted by Mortgagee shall be brought in
the name of Mortgagee and any recovery of judgment shall be subject to the
rights of Mortgagee.
53
(j) Remedies Cumulative. No remedy herein conferred upon or reserved to
Mortgagee is intended to be exclusive of any other remedy, and each such remedy
shall be cumulative and in addition to every other remedy given hereunder or now
or hereafter existing at law or in equity. No delay or omission of Mortgagee to
exercise any right or power accruing upon any Event of Default shall impair any
such right or power, or shall be construed to be a waiver of any such Event of
Default or an acquiescence therein. Every power and remedy given by this
Mortgage to Mortgagee may be exercised from time to time and as often as may
deemed expedient by Mortgagee. Nothing contained in this Mortgage shall affect
the obligations of Mortgagors to pay the principal of, and interest on, the
Notes in the manner and at the time and place expressed in the Notes.
(k) Waiver of Rights. Mortgagors agree that to the fullest extent permitted
by law Mortgagors will not, at any time, (a) insist upon, plead or claim or take
any benefit or advantage of any stay, extension or moratorium law, wherever
enacted, now or at any time hereafter in force, which may affect the covenants
and terms of performance of this Mortgage, (b) claim, take or insist upon any
benefit or advantage of any law, now or at any time hereafter in force,
providing for valuation or appraisal of the Mortgaged Property, or any part
thereof, prior to any sale or sales thereof which may be made pursuant to any
provision herein contained, or pursuant to the decree, judgment or order of any
court of competent jurisdiction, or (c) after any such sale or sales, claim or
exercise any right, under any statute heretofore or hereafter enacted by the
United States of America, any State thereof or otherwise, to redeem the property
and rights sold pursuant to such sale or sales or any part hereof. Mortgagors
hereby expressly waive all benefits and advantages of such laws, and covenants,
to the fullest extent permitted by law, not to hinder, delay or impede the
execution of any power herein granted or delegated to Mortgagee, but will suffer
and permit the execution of every power as though no such laws had been made or
enacted. Mortgagors for themselves, and all who may claim through or under them,
waive, to the extent that they lawfully may do so, any and all homestead rights,
any and all rights to reinstatement, any and all right to have the property
comprising the Mortgaged Property marshaled upon any foreclosure of the lien
hereof or to have the mortgaged property hereunder and the property
54
covered by any other mortgage, deed to secure debt or
deed.
(l) If in connection with the exercise of any remedies hereunder, either
Mortgagor shall pay more than its proportionate share of the Obligations such
excess shall be deemed to be a loan from such Mortgagor to the other Mortgagor
in the amount of such excess, which loan or loans shall be subordinate to the
Lien of this Mortgage.
20. Application of Proceeds. The proceeds of any sale or foreclosure of the
Mortgaged Property shall be applied to the following in such priority as
Mortgagee shall elect in its sole discretion: (a) to the payment of the costs
and expenses of the foreclosure proceedings (including, without limitation,
reasonable counsel fees and disbursements actually incurred and advertising
costs and expenses), liabilities and advances made or incurred under this
Mortgage, and reasonable receivers' and trustees' fees and commissions together
with interest at the Default Rate, (b) to the payment of any other sums advanced
by Mortgagee in accordance with the terms hereof and not repaid to it by
Mortgagors, together with interest at the Default Rate from and after the date
incurred, (c) to the payment of all sums due under the Notes and the Breakage
Obligations, if any, pro rata, and in such order as Mortgagee may elect, (d) to
the payment of all sums due under any other Loan Document, in such order as
Mortgagee shall elect, and (e) to the payment of any surplus to Mortgagors or
other party legally entitled thereto.
21. Notice of Certain Occurrences. Mortgagors shall give notice to
Mortgagee promptly upon the occurrence of: (a) any Default or Event of Default;
(b) any litigation or proceeding affecting Mortgagors or the Mortgaged Property
which is reasonably likely, if adversely determined to have a material adverse
effect on the value of the Properties in the aggregate; and (c) a material
adverse change in the business, operations, property or financial condition of
Mortgagors.
22. WAIVER OF TRIAL BY JURY; WAIVER OF STATUTORY RIGHTS.
(a) EACH MORTGAGOR HEREBY WAIVES AND SHALL WAIVE, TO THE EXTENT PERMITTED
BY LAW, TRIAL BY JURY IN
55
ANY ACTION OR PROCEEDING BROUGHT BY, OR COUNTERCLAIM ASSERTED BY MORTGAGEE WHICH
ACTION, PROCEEDING OR COUNTERCLAIM ARISES OUT OF OR IS CONNECTED WITH THIS
MORTGAGE, THE NOTES OR ANY OTHER LOAN DOCUMENTS.
(b) EACH MORTGAGOR SHALL NOT AND WILL NOT APPLY FOR OR AVAIL ITSELF OF ANY
APPRAISEMENT, VALUATION, STAY, EXTENSION OR EXEMPTION LAWS, OR ANY SO-CALLED
"MORATORIUM LAWS", NOW EXISTING OR HEREAFTER ENACTED, IN ORDER TO PREVENT OR
HINDER THE ENFORCEMENT OR FORECLOSURE OF THIS MORTGAGE, BUT HEREBY WAIVES THE
BENEFIT OF SUCH LAWS TO THE FULL EXTENT THAT SUCH MORTGAGOR MAY DO SO UNDER
APPLICABLE LAW. EACH MORTGAGOR FOR ITSELF AND ALL WHO MAY CLAIM THROUGH OR UNDER
IT WAIVES ANY AND ALL RIGHT TO HAVE THE PROPERTY AND ESTATES COMPRISING THE
MORTGAGED PROPERTY MARSHALLED UPON ANY FORECLOSURE OF THE LIEN OF THIS MORTGAGE
AND AGREES THAT ANY COURT HAVING JURISDICTION TO FORECLOSE SUCH LIEN MAY ORDER
THE MORTGAGED PROPERTY SOLD AS AN ENTIRETY. EACH MORTGAGOR HEREBY WAIVES FOR
ITSELF AND ALL WHO MAY CLAIM THROUGH OR UNDER IT, AND TO THE FULL EXTENT SUCH
MORTGAGOR MAY DO SO UNDER APPLICABLE LAW, ANY AND ALL RIGHTS OF REDEMPTION FROM
SALE UNDER ANY ORDER OR DECREE OF FORECLOSURE OF THIS MORTGAGE OR GRANTED UNDER
ANY STATUTE NOW EXISTING OR HEREAFTER ENACTED.
23. Trust Funds. All security deposits paid under the Leases shall be
treated as trust funds not to be commingled with any other funds of Mortgagors.
Within ten (10) days after request by Mortgagee, Mortgagors shall furnish
Mortgagee satisfactory evidence of compliance with this Section 23, together
with a statement of all security deposits by tenants under the Leases, which
statement shall be certified by Mortgagors.
24. Taxes. (a) In the event of the passage after the date hereof of any law
of the United States or of the State of New York either (i) deducting from the
value thereof, or changing in any way the laws for the taxation of mortgages or
debts secured thereby for federal, state or local purposes, or the manner of
collection of any such taxes, or (ii) imposing a tax, either directly or
indirectly, on mortgages or debts secured thereby, Mortgagors shall assume as an
obligation hereunder the payment of any tax so imposed until full payment of the
Notes provided such assumption shall be permitted by law within thirty (30) days
after written demand therefor from Mortgagee.
56
(b) All payments by Mortgagors of princi- pal of, and interest on, the Loan
and all other amounts payable hereunder shall be made free and clear of and
without deduction for any Taxes. In the event that any withholding or deduction
from any payment to be made by Mortgagors hereunder is required in respect of
any Taxes pursuant to any applicable law, rule or regulation, then Mortgagors
will: (i) pay directly to the relevant authority the full amount required to be
so withheld or deducted; (ii) promptly forward to Mortgagee an official receipt
or other documentation satisfactory to Mortgagee evidencing such payment to such
authority; and (iii) pay to Mortgagee such additional amount or amounts as is
necessary to ensure that the net amount actually received by Mortgagee will
equal the full amount Mortgagee would have received had no such withholding or
deduction been required. Moreover, if any Taxes are directly asserted against
Mortgagee with respect to any payment received by Mortgagee under the Notes, or
hereunder, Mortgagee may pay such Taxes and Mortgagors will within five Domestic
Business Days pay such additional amounts (including any penalties, interest or
expenses) as are necessary in order that the net amount received by such person
after the payment of such Taxes (including any Taxes on such additional amount)
shall equal the amount such person would have received had no such Taxes been
asserted.
(c) If Mortgagors fails to pay any Taxes when due to the appropriate taxing
authority or fails to remit to Mortgagee the required receipts or other required
documentary evidence, Mortgagors shall indemnify Mortgagee for any incremental
Taxes, interest or penalties that may become payable by Mortgagee as a result of
any such failure.
(d) For purposes hereof, "Taxes" shall have the meaning set forth in
Section 8.4(a) of the Credit Agreement.
25. Notices. Any notice, election, request or demand which by any provision
of this Mortgage is re- quired or permitted to be given or served hereunder
shall be in writing and shall be given or served by hand deliv- ery against
receipt, by any nationally recognized over- night courier service providing
evidence of the date of delivery or by certified mail return receipt requested,
postage prepaid, addressed to Mortgagors at: c/o ▇▇▇▇▇▇ Capital Group, L.P., ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
57
10022, Attention: ▇▇▇▇ ▇. ▇▇▇▇▇, with a copy to Tishman Speyer Properties, L.P.,
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇, General
Counsel, and with a copy to Battle ▇▇▇▇▇▇, LLP, ▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq., and if to Mortgagee, to
The Chase Manhattan Bank, Chase Real Estate Finance Group, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attn: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, with a copy to The
Chase Manhattan Bank, Legal Department, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq., and with a copy to Skadden, Arps,
Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq., or at such other address as shall be designated from
time to time by Mortgagors or Mortgagee by notice given in accordance with the
provisions of this Section 25. Any such notice or demand given hereunder shall
be effective upon receipt or refusal (as indicated on the receipt) after mailing
as aforesaid.
26. No Oral Modification. This Mortgage may not be altered, amended,
modified, changed or terminated orally but only by a written agreement signed by
the party against which enforcement is sought.
27. 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
hereunder.
28. Successors and Assigns. (a) All cove- nants of Mortgagors contained in
this Mortgage are im- posed solely and exclusively for the benefit of Mortgagee
and its successors and assigns, and no other Person shall have standing to
require compliance with such covenants or be deemed, under any circumstances, to
be Mortgagee of such covenants, any or all of which may be freely waived in
whole or in part by Mortgagee at any time if in its sole discretion it deems it
advisable to do so. All such covenants of Mortgagors shall run with the land and
bind Mortgagors, the successors and assigns of Mortgagors (and each of them) and
all subsequent owners, encumbrancer and Tenants of the Mortgaged Property, and
shall inure to the benefit of Mortgagee, its successors and assigns. The
58
word "Mortgagee" shall be construed to mean Mortgagee
named herein.
(b) Any assignee of this Mortgage and the Notes which is not an Affiliate
of any Lender shall take the same free and clear of all offsets, counterclaims
or defenses of any nature whatsoever which Mortgagors may have against any
assignor of this Mortgage and the Note, and no such offset, counterclaim or
defense shall be interposed or asserted by Mortgagors in any action or
proceeding brought by any such assignee upon this Mortgage or the Notes and any
such right to interpose or assert any such offset, counterclaim or defense in
any such action or proceeding is hereby expressly waived by Mortgagors.
29. Governing Law. This Mortgage and the obligations arising hereunder
shall be governed by and construed in accordance with, the laws of the State of
New York. Whenever possible, each provision of this Mortgage shall be
interpreted in such a manner as to be effective and valid under applicable law,
but if any provision of this Mortgage shall be prohibited by, or invalid under,
applicable law, such provision shall be ineffective to the extent of such
prohibition or invalidity without invalidating the remaining provisions of this
Mortgage. Nothing contained in this Mortgage or in any Loan Document shall
require either Mortgagors to pay or Mortgagee to accept any sum in any amount
which would, under applicable law, subject Mortgagee or any Mortgagee to penalty
or adversely affect the enforceability of this Mortgage. In the event that the
payment of any sum due hereunder or under any Loan Document would have such
result under applicable law, then, ipso facto, the obligation of Mortgagors to
make such payments shall be reduced to the highest sum then permitted under
applicable law and appropriate adjustment shall be made by Mortgagors and
Mortgagee.
30. Certain Representations, Warranties and Covenants.
(a) Recording Fees, Taxes, Etc. Mortgag- ors hereby agree to take all such
further reasonable actions, and to pay all taxes, recording fees, charges, costs
and other similar expenses including, without limitation, reasonable attorneys'
and reasonable professional fees and disbursements which are currently or in the
59
future shall be imposed, and which may be required or necessary to establish,
preserve, protect or enforce the Lien of this Mortgage.
(b) No Offsets. Mortgagors warrant, covenant and represent to Mortgagee
that there exists no cause of action at law or in equity that would constitute
any offset, counterclaim or deduction against the Indebtedness or the
Obligations under this Mortgage.
(c) Tax Filings. Mortgagors have filed all Federal, state and local tax
returns required to be filed prior to the date hereof and have paid or made
adequate provision for the payment of all Federal, state and local taxes,
charges and assessments shown to be due from Mortgagors on such tax returns.
(d) No Litigation. To Mortgagors' knowl- edge, no litigation is pending or
threatened against Mortgagors which, if determined adversely to Mortgagors,
would have a material adverse effect on the Properties, the security created
hereby and Mortgagors have received no written notice from any Governmental
Authority that a Taking has been commenced or is threatened with respect to all
or any portion of the Mortgaged Property or for the relocation of roadways
providing access to the Mortgaged Property.
(e) Solvency. The fair saleable value of Mortgagors' assets exceed and
will, immediately following the making of the Loan and the consummation of the
other transactions contemplated to take place simultaneously therewith, exceed
Mortgagors' liabilities, including, without limitation, subordinated,
unliquidated, disputed and contingent liabilities. Mortgagors' assets do not
and, immediately following the making of the Loan and the consummation of the
other transactions contemplated to take place simultaneously therewith will not,
constitute unreasonably small capital to carry out its business as conducted or
as proposed to be conducted. Each Mortgagor does not intend to, and does not
believe that it will, incur debts and liabilities (including, without
limitation, contingent liabilities) beyond its ability to pay such debts as they
mature.
(f) Liens. No Lien (other than Permitted Liens), including, without
limitation, any tax lien, has been levied against any of the Mortgaged Property.
60
(g) Trust Funds. Mortgagors shall re- ceive the advances secured hereby
subject to the trust fund provisions of Section 13 of the Lien Law of the State
of New York.
(h) Performance of Other Agreements. Mortgagors shall observe and perform
each and every term to be observed or performed by Mortgagors pursuant to the
terms of any agreement or recorded instrument affecting or pertaining to the
Mortgaged Property for which the failure to comply shall have a Material Adverse
Effect.
(i) Other Security for the Indebtedness. Mortgagors shall observe and
perform all of the terms, covenants and provisions contained in the Credit
Agreement and in all other mortgages and other instruments or documents
evidencing, securing or guaranteeing payment of the Indebtedness, in whole or in
part, or otherwise executed and delivered in connection with the Credit
Agreement, the Notes, this Mortgage or the Loan evidenced and secured thereby or
hereby.
31. No Waiver. No failure by Mortgagee to insist upon the strict
performance of any term hereof or to exercise any right, power or remedy
consequent upon a breach thereof shall constitute a waiver of any such term or
right, power or remedy or of any such breach. No waiver of any breach shall
affect or alter this Mortgage, which shall continue in full force and effect, or
shall affect or alter the rights of Mortgagee with respect to any other then
existing or subsequent breach.
32. Recourse and Non-Recourse Obligations. The provisions of Section 9.14
of the Credit Agreement shall be deemed to be incorporated herein by reference.
33. Further Assurances.
(a) Mortgagors, at its own expense, will execute, acknowledge and deliver
all such reasonable further acts, documents or instruments including, without
limitation, security agreements on any personalty included or to be included in
the Mortgaged Property and a separate assignment of each Lease and take all such
actions as Mortgagee from time to time may reasonably request to better assure,
transfer and confirm unto Mortgagee the rights now or hereafter intended to be
61
granted to Mortgagee under this Mortgage or the other
Loan Documents.
(b) Mortgagors covenant to give notice to Mortgagee no less than thirty
(30) days prior to a change of address.
34. Additional Security. Without notice to or consent of Mortgagors and
without impairment of the Lien and rights created by this Mortgage, Mortgagee
may accept (but Mortgagors shall not be obligated to furnish) from Mortgagors
additional security for the Notes. Neither the giving of this Mortgage nor the
acceptance of any such additional security shall prevent Mortgagee from
resorting, first, to such additional security, and, second, to the security
created by this Mortgage without affecting Mortgagee's Lien and rights under
this Mortgage.
35. Indemnification by Mortgagors. Subject to the provisions of Section 32
of this Mortgage, Each Mortgagor will protect, indemnify and save harmless each
Indemnitee from and against all liabilities, obligations, claims, damages,
penalties, causes of action, costs and expenses (including all reasonable
attorneys' fees and expenses actually incurred) imposed upon or incurred by or
asserted against any indemnitee or the Mortgaged Property or any part of its
interest therein, by reason of the occurrence or existence of any of the
following (to the extent the insurance Proceeds payable on account of the
following shall be inadequate) prior to (i) the payment in full of the Notes and
the Breakage Obligations, if any, (ii) the acceptance by Mortgagee of a
deed-in-lieu of foreclosure with respect to the applicable Property, or (iii)
Mortgagee's taking possession or control of the Mortgaged Property, unless
caused by the willful misconduct or gross negligence of Mortgagee (other than
such willful misconduct or gross negligence imputed to Mortgagee because of its
interest in the Mortgaged Property): (a) ownership of Mortgagors' interest in
the Mortgaged Property, or any interest therein, or receipt of any Rents or
other sum therefrom, (b) any accident, injury to or death of any persons or loss
of or damage to property occurring on or about the Mortgaged Property or any
appurtenances thereto, (c) any design, construction, operation, repair,
maintenance, use, non-use or condition of the Mortgaged Property or
appurtenances thereto, including claims or penalties arising
62
from violation of any Legal Requirement or Insurance Requirement, as well as any
claim based on any patent or latent defect, whether or not discoverable by
Mortgagee, any claim the insurance as to which is inadequate, and any
Environmental Claim, (d) any failure on the part of Mortgagors to perform or
comply with any of the material terms of any Lease within the applicable notice
or grace periods, (e) any performance of any labor or services or the furnishing
of any materials or other property in respect of the Mortgaged Property or any
part thereof as provided for herein, (f) any negligence or tortious act or
omission on the part of Mortgagors or any of its agents, contractors, servants,
employees, sublessees, licenses or invitees, (g) any contest referred to in
Section 7 hereof, or (h) any obligation or undertaking relating to the
performance or discharge of any of the terms, covenants and conditions of the
landlord contained in the Leases. Any amounts payable to the any Indemnitee
under this Section 35 which are not paid within ten (10) Domestic Business Days
after written demand therefor by Mortgagee; setting forth in reasonable detail
the amount of such demand and the basis therefor, shall bear interest from the
date of demand at the Default Rate, and shall be part of the Indebtedness and
secured by this Mortgage. In case any action, suit or proceeding is brought
against any indemnitee by reason of any such occurrence, each Mortgagor shall at
Mortgagors expense resist and defend such action, suit or proceeding or will
cause the same to be resisted and defended by counsel for the insurer of the
liability or by counsel designated by Mortgagors (unless reasonably disapproved
by Mortgagee promptly after Mortgagee has been notified of such counsel);
provided, however, that nothing herein shall compromise the right of Mortgagee
to appoint its own counsel for its defense with respect to any action which in
its reasonable opinion presents a conflict or potential conflict between
Mortgagee and Mortgagors that would make such separate representation advisable.
So long as Mortgagors are resisting and defending such action, suit or
proceeding as provided above in a prudent and commercially reasonable manner,
such indemnitee shall not be entitled to settle such action, suit or proceeding
and claim the benefit of this Section 35 with respect to such action, suit or
proceeding and such indemnitee agrees that it will not settle any such action,
suit or proceeding without the consent of Mortgagors unless failure to settle
would subject Mortgagee to criminal penalties or result in the forfeiture of any
Property or Mortgagee's
63
interest therein; provided, however, that if Mortgagors are not diligently
defending such action, suit or proceeding in a prudent and commercially
reasonable manner as provided above, such indemnitee may settle such action,
suit or proceeding subject only to the consent of Mortgagors, which consent
shall not be unreasonably withheld or delayed, and claim the benefit of this
Section 35 with respect to settlement of such action, suit or proceeding.
Mortgagee will give Mortgagors prompt notice after it obtains actual knowledge
of any potential claim by it for indemnification hereunder however the failure
of Mortgagee to give such notice to Mortgagors shall not affect Mortgagors'
obligations hereunder.
36. Sole Discretion of Mortgagee. Except as may otherwise be expressly
provided to the contrary, wherever pursuant to the Notes, this Mortgage, the
Credit Agreement or any other Loan Document, Mortgagee exercises any right given
to it to consent or not consent, or to approve or disapprove, or any arrangement
or term is to be satisfactory to Mortgagee, the decision of Mortgagee to consent
or not consent, or to approve or disapprove, or to decide that arrangements or
terms are satisfactory or not satisfactory, shall be in the sole and absolute
discretion of Mortgagee and shall be final and conclusive.
37. Right of Entry. Mortgagee and its agents shall have the right to enter
and inspect the Mortgaged Property at all reasonable times.
38. Waiver of Notice. Mortgagors shall not be entitled to any notices of
any nature whatsoever from Mortgagee except with respect to matters for which
this Mortgage specifically and expressly provides for the giving of notice by
Mortgagee to Mortgagors, and each Mortgagor hereby expressly waives the right to
receive any notice from Mortgagee with respect to any matter for which this
Mortgage does not specifically and expressly provide for the giving of notice by
Mortgagee to Mortgagors.
39. Estoppel Certificates. Each Mortgagor, within ten (10) days after
request by Mortgagee and at Mortgagors' expense, will furnish Mortgagee with a
state- ment, duly acknowledged and certified, setting forth the amount of the
Indebtedness and the offsets or defenses thereto, if any.
64
40. Brokerage. Each Mortgagor covenants and agrees that no brokerage
commission or other fee, commis- sion or compensation is to be paid by Mortgagee
and each Mortgagor agrees to indemnify Mortgagee against any claims for any of
the same.
41. Relationship. The relationship of Mortgagee to each Mortgagor hereunder
is strictly and solely that of lender and borrower and mortgagor and mortgagee
and swap counterparties and nothing contained in the Note, this Mortgage, the
Credit Agreement or any other Loan Document is intended to create, or shall in
any event or under any circumstance be construed as creating, a partnership,
joint venture, tenancy-in-common, joint tenancy or other relationship of any
nature whatsoever between Mortgagee and each Mortgagor other than as lender and
borrower and mortgagor and mortgagee and swap counterparties.
42. Liability. The obligations and liabili- ties of each Mortgagor
hereunder shall be joint and several.
43. 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
"Mortgagors" shall mean each Mortgagor and any subsequent owner or owners of the
Mortgaged Property or any part thereof or interest therein; the word "Mortgagee"
shall mean Mortgagee or any subsequent Agent for the holder of the Notes; the
word "Notes" shall mean the Notes, any amendment, extension, modification,
restatement or replacement thereof or any other evidence of indebtedness secured
by this Mortgage; the words "Mortgaged Property" shall include any portion of
the Mortgaged Property or interest therein; and the word "Indebtedness" shall
mean all sums secured by this Mortgage. 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.
44. Headings, etc. The headings and captions of various paragraphs of this
Mortgage 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.
65
45. Duplicate Originals. This Mortgage may be executed in any number of
duplicate originals, and each such duplicate original shall be deemed to
constitute but one and the same instrument.
46. Non-Residential Property. This Mortgage does not cover real property
principally improved by one or more structures containing in the aggregate six
(6) or less residential dwelling units having their own separate cooking
facilities.
47. Reasonableness. If at any time Mortgagors believe that Mortgagee has
not acted reasonably in granting or withholding any approval or consent under
the this Mortgage, the Credit Agreement or any other Loan Document, as to which
approval or consent either Mortgagee has expressly agreed to act reasonably, or
absent such agreement, a court of law having jurisdiction over the subject
matter would require Mortgagee to act reasonably, then Mortgagors' sole remedy
shall be to seek injunctive relief or specific performance and no action for
monetary damages or punitive damages shall in any event or under any
circumstance be maintained by Mortgagors against Mortgagee.
48. Swap Agreement. The parties hereto agree that all sums that may or
shall become due and payable by Mortgagors to Mortgagee in accordance with the
Swap Agreement shall be deemed to constitute additional interest on the
indebtedness represented by, and shall be evidenced by, the Notes, shall be
secured by this Mortgage and shall constitute part of the Indebtedness. The lien
of this Mortgage insofar as it secures payment of sums that may or shall become
due and payable by Mortgagors to Mortgagee in accordance with the Swap Agreement
is and shall continue to be equal in lien to the lien of this Mortgage insofar
as it secures the payment of the balance of the Indebtedness. The parties hereto
agree that, if the Notes shall be declared to be immediately due and payable as
the result of an occurrence of an Event of Default or if the Notes are not paid
in full at maturity, then all sums that become available to Mortgagee pursuant
to this Mortgage shall be applied to sums due under the Swap Agreement and to
the balance of the Indebtedness in the same proportion that such sums bear to
such balance. The terms, covenants and conditions of the Swap Agreement are
incorporated herein by this reference
66
with the same effect as if the same were fully set forth
in this Mortgage.
49. Release. (a) Mortgagors may obtain the release (in whole, but not in
part) of one of the Proper- ties (as selected by Mortgagors in their sole
discretion) from the Lien of this Mortgage upon satisfaction of all of the
conditions of Section 2.9(d) of the Credit Agree- ment.
(b) If Mortgagors shall pay or cause to be paid the principal of and
interest on the Notes in full at maturity or earlier as permitted in accordance
with the terms thereof and all other Indebtedness payable to Mortgagee hereunder
by Mortgagors or secured hereby or by the other Loan Documents and all of the
Obligations shall have been performed, then this Mortgage and all the other Loan
Documents shall be discharged and satisfied or assigned to Mortgagors or to any
other Person at Mortgagors' direction and without recourse or warranty to
Mortgagee at the expense of Mortgagors upon their written request. Concurrently
with such release and satisfaction or assignment of this Mortgage and all the
other Loan Documents, Mortgagee will return to Mortgagors the Notes and all
insurance policies relating to the Mortgaged Property which may be held by
Mortgagee and, on the written request and at the expense of Mortgagors, will
execute and deliver such proper instruments of release (including appropriate
UCC-3 termination statements) as may reasonably be requested by Mortgagors to
evidence such release and satisfaction or assignment, and any such instrument,
when duly executed by Mortgagee and duly recorded in the places where this
Mortgage and each other Loan Document is recorded, shall conclusively evidence
the release and satisfaction or assignment of this Mortgage and the other Loan
Documents.
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IN WITNESS WHEREOF, this Mortgage has been duly executed by Mortgagors on
the date first hereinabove written.
MORTGAGORS:
1290 PARTNERS, L.P.
By: 1290 GP Corp.,
General Partner
By:_____________________
Name:
Title:
237 PARK PARTNERS, L.P.
By: 237 GP Corp.,
General Partner
By:_____________________
Name:
Title:
STATE OF NEW YORK )
ss.:
COUNTY OF NEW YORK )
On this 9th day of October, 1996, before me personally came ▇▇▇ ▇. ▇▇▇▇▇▇▇,
to me known, who, being by me duly sworn, did depose and say that he resides at
▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, and that he is a President of 1290
GP Corp., a Delaware corporation, the general partner of 1290 PARTNERS, L.P.,
the partnership that executed the foregoing instrument; and that this instrument
has been executed as the act and deed of 1290 PARTNERS, L.P.; and that said
partnership executed the same.
Notary Public
STATE OF NEW YORK )
ss.:
COUNTY OF NEW YORK )
On this 9th day of October, 1996, before me personally came ▇▇▇ ▇. ▇▇▇▇▇▇▇,
to me known, who, being by me duly sworn, did depose and say that he resides at
▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, and that he is a President of 237 GP Corp., a Delaware
corporation, the general partner of 237 PARK PARTNERS, L.P., the partnership
that executed the foregoing instrument; and that this instrument has been
executed as the act and deed of 237 PARK PARTNERS, L.P.; and that said
partnership executed the same.
Notary Public
69
EXHIBIT A-1
DESCRIPTION OF 1290 LAND
70
EXHIBIT ▇-▇
▇▇▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇
71
EXHIBIT B
EXISTING NOTES
72
EXHIBIT C
EXISTING MORTGAGES
73
EXHIBIT D
COLLECTION ACTIONS
74
TABLE OF CONTENTS
Page
SECTION 1. Definitions. ...................................... 12
SECTION 2. Warranty............................................ 19
SECTION 3. Payment and Performance of Obligations Secured...... 21
SECTION 4. Negative Covenants.................................. 22
SECTION 5. Insurance........................................... 23
SECTION 6. Condemnation and Insurance Proceeds................. 26
SECTION 7. Impositions, Liens and Other Items.................. 31
SECTION 8. Funds for Taxes and Insurance....................... 33
SECTION 9 Transfers, Additional Indebtedness and
Subordinate Liens............................. 35
SECTION 10. Maintenance of Mortgaged Property; Alterations;
Inspection; Utilities......................... 36
SECTION 11. Legal Compliance; Compliance with Covenants and
Easements..................................... 37
SECTION 12. Books and Records, Financial Statements, Reports
and Other Information......................... 38
SECTION 13. Compliance with Leases and Agreements............... 38
SECTION 14. Mortgagee's Right to Perform........................ 40
SECTION 15. Mortgagors' Existence; Organization and
Authority..................................... 40
SECTION 16. Protection of Security; Costs and Expenses.......... 41
SECTION 17. Management of the Mortgaged Property................ 43
SECTION 18. Environmental Matters............................... 44
SECTION 19. Remedies............................................ 48
SECTION 20. Application of Proceeds............................. 55
SECTION 21. Notice of Certain Occurrences....................... 55
SECTION 22. WAIVER OF TRIAL BY JURY; WAIVER OF STATUTORY
RIGHTS........................................ 55
SECTION 23. Trust Funds......................................... 56
SECTION 24. Taxes............................................... 56
SECTION 25. Notices............................................. 57
SECTION 26. No Oral Modification................................ 58
SECTION 27. Partial Invalidity.................................. 58
SECTION 28. Successors and Assigns.............................. 58
SECTION 29. Governing Law....................................... 59
SECTION 30. Certain Representations, Warranties and
Covenants..................................... 59
SECTION 31. No Waiver........................................... 61
SECTION 32. Recourse and Non-Recourse Obligations............... 61
SECTION 33. Further Assurances.................................. 61
SECTION 34. Additional Security................................. 62
SECTION 35. Indemnification by Mortgagors....................... 62
SECTION 36. Sole Discretion of Mortgagee........................ 64
i
Page
SECTION 37. Right of Entry..................................... 64
SECTION 38. Waiver of Notice................................... 64
SECTION 39. Estoppel Certificates.............................. 64
SECTION 40. Brokerage.......................................... 65
SECTION 41. Relationship....................................... 65
SECTION 42. Liability.......................................... 65
SECTION 43. Certain Definitions................................ 65
SECTION 44. Headings, etc...................................... 65
SECTION 45. Duplicate Originals................................ 66
SECTION 46. Non-Residential Property........................... 66
SECTION 47. Reasonableness..................................... 66
SECTION 48. Swap Agreement..................................... 66
SECTION 49. Release............................................ 67
ii