EXHIBIT 10.49
Composition
MORTGAGE,
ASSIGNMENT OF LEASES
AND RENTS AND SECURITY AGREEMENT
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THIS MORTGAGE, ASSIGNMENT OF LEASES AND RENTS AND SECURITY AGREEMENT
("MORTGAGE") is made as of the 24th day of October, 1997, by MIKOHN GAMING
CORPORATION, a Nevada corporation, with its principal place of business at ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇ ("MORTGAGOR"), to and for the benefit
of FIRST SOURCE FINANCIAL LLP, an Illinois registered limited liability
partnership ("MORTGAGEE"), with an office at c/o First Source Financial, Inc.,
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ Tower, 5th Floor, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
RECITALS:
A. Mortgagor is the owner of the Premises (this and all other capitalized
terms used but not elsewhere defined herein are defined in Section 1.1) and the
Improvements.
B. Pursuant to the terms of the Credit Agreement, Mortgagee has agreed to
make certain loans and other financial accommodations to Mortgagor.
C. The Loans are evidenced by the Notes.
D. One of the conditions precedent to the obligation of Mortgagee to make
the Loans is the execution and delivery by Mortgagor of this Mortgage.
ARTICLE I
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DEFINITIONS AND DETERMINATIONS
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1.1 DEFINITIONS. Capitalized terms used but not elsewhere defined in this
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Mortgage shall have the meanings ascribed thereto in the Credit Agreement. When
used in this Mortgage, the following terms shall have the following meanings:
Construction Contracts: any contracts executed by Mortgagor with any
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provider of goods or services in connection with any construction
undertaken on, or services performed in connection with, the Premises or
the Improvements.
Credit Agreement: that certain Credit Agreement dated as of October
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____, 1997 among Borrower, Lenders and Agent, as the same may be amended,
modified or supplemented after the date hereof.
Deposits: all deposits (i) received by Mortgagor from third parties
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(including all ▇▇▇▇▇▇▇ money sales deposits) or (ii) deposited by Mortgagor with
Mortgagee or third parties, including deposits pertaining to utility services,
real estate taxes, special assessments and payment of insurance premiums.
Documents: any mortgage, deed of trust, assignment of leases,
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assignment of rents, note, indemnification agreement, security agreement,
financing statement, affidavit, assignment of insurance, loss payee endorsement,
mortgage title insurance policy, opinion letter, waiver letter, estoppel letter,
consent letter, insurance certificate and any other similar documents.
Equipment: all apparatus, machinery, equipment, furniture, fixtures,
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fittings, goods, materials, supplies and chattels of any and every kind and
nature whatsoever now or hereafter used, attached to, installed or located in or
on the Premises and/or the Improvements, including any item used to supply heat,
gas, air conditioning, water, light, electricity, power, plumbing,
refrigeration, sprinkling, ventilation, mobility, communication, incineration,
recreation, laundry service or any other related services.
Event of Default: each of the Events of Default set forth in the
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Credit Agreement.
Future Advances: all advances made by Mortgagee under the Credit
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Agreement after the Closing Date to or on behalf of Mortgagor.
Imposts: any disbursements made in accordance with the terms hereof
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for the payment of taxes, levies or insurance on the Premises.
Improvements: the buildings and improvements now or hereafter located
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on the Premises, all tenements, easements, rights-of-way, hereditaments and
appurtenances now and/or at any time hereafter situated on such real estate and
all roads, alleys, streets, passages and other public ways abutting such real
estate, whether before or after vacation thereof and whether in existence as of
the date hereof or created after the date hereof.
Leases: collectively, all (i) present and future leases, subleases,
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agreements, tenancies, subtenancies, licenses, occupancy agreements, concessions
and franchises of Mortgagor's present and future right, title, and interest in
and to the Premises and/or the Improvements, (ii) deposits of money as advance
rent or for security under any of the Leases and (iii) guaranties of performance
under the items described in clauses (i) and (ii) preceding.
Lenders: the financial institutions from time to time party to the
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Credit Agreement.
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Mortgaged Property: collectively, all of Mortgagor's present and
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future estate, right, title, and interest in and to the following:
(a) the Premises;
(b) the Improvements;
(c) the Rents;
(d) the Leases;
(e) all Plans;
(f) all Deposits;
(g) all Permits;
(h) all Equipment;
(i) all Construction Contracts;
(j) all present and future judgments, awards of damages and
settlements made as a result or in lieu of any taking of all or any part of the
Premises, Improvements, Equipment and/or Leases under the power of eminent
domain, or for any damage thereto as a result of any such taking;
(k) all insurance policies in force or effect insuring the Premises,
the Improvements, the Rents, the Leases or the Equipment;
(l) rights arising out of Mortgagor's interest in the Premises and the
Improvements to (i) the payment of money, (ii) accounts receivable, (iii)
reserves, (iv) deferred payments, (v) refunds and (vi) cost savings;
(m) all development and use rights with respect to the
Premises, the Improvements and/or the Leases;
(n) all chattel paper, instruments, documents, notes, drafts and
letters of credit, other than letters of credit in favor of Mortgagee, which
arise from or relate to (i) construction on the Premises or (ii) the Premises
and Improvements generally;
(o) all causes of action and proceeds thereof for any damage or injury
to the Premises or the Improvements or any other portion of the Mortgaged
Property described above, in addition to those described in clause (j) above, or
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breach of warranty in connection with the construction of all or any portion of
the Improvements; and
(p) all proceeds (including condemnation and insurance proceeds) of,
additions to, substitutions for, and changes in each and every one of the
foregoing.
Mortgage Lien: the Lien in favor of Mortgagee represented by this
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Mortgage.
Mortgagor's Obligations: (i) any and all Indebtedness due or to
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become due, now existing or howsoever arising of Mortgagor to Mortgagee pursuant
to the terms of the Credit Agreement, including, without limitation, all (A)
advances made in accordance with the terms hereof to protect and preserve the
value of the Mortgaged Property and the priority of the Mortgage Lien and (B)
Future Advances and (ii) the performance of the covenants of Mortgagor contained
in the Credit Agreement and the Related Documents.
Permits: all permits, certificates, approvals, licenses, applications
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and authorizations used in the operation of the Premises, Improvements and/or
the Leases.
Plans: all plans and specifications, designs, surveys, drawings, soil
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reports and other matters prepared for any construction on the Premises.
Premises: the real property legally described in EXHIBIT A.
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Rents: all present and future rents, royalties, issues, avails,
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profits and proceeds of or from the Premises, the Improvements, the Leases
and/or the Equipment.
1.2 CERTAIN TERMS. Wherever used in this Mortgage:
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1.2.1 AND/OR. The term "and/or" means one or the other or both.
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1.2.2 REFERENCES. All references to "Article", "Section",
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"subsection", "Subparagraph", "Clause" or "Exhibit", unless otherwise stated,
shall be deemed to refer to an Article, Section, subsection, subparagraph,
clause or Exhibit, as applicable, of this Mortgage.
1.2.3 EXHIBITS. Each reference to an "Exhibit" to this Mortgage
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is to an Exhibit which is attached to this Mortgage, each of which Exhibits is
deemed to be a part hereof.
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ARTICLE II
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CONVEYANCE
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2.1 MORTGAGED PROPERTY. To secure the payment and performance of
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Mortgagor's Obligations or the Liabilities, subject to the terms, covenants and
provisions contained herein, Mortgagor hereby MORTGAGES AND CONVEYS to
Mortgagee, its successors and/or assigns all of Mortgagor's right, title and
interest in and to the Mortgaged Property. Mortgagee, its successors and
assigns, subject to the terms of this Mortgage, are to have and to hold all such
Mortgaged Property forever for the benefit of Mortgagee for the purposes and
uses set forth in this Mortgage.
2.2 SECURITY AGREEMENT AND FIXTURE FILING. This Mortgage constitutes
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a security agreement with respect to the portion of the Mortgaged Property which
consists of personal property and a financing statement filed as a fixture
filing under the Uniform Commercial Code of the State in which the Premises are
located, covering any property which now is or later may become a fixture
attached to the Premises or the Improvements.
2.3 ABSOLUTE ASSIGNMENT. This Mortgage is a present and absolute
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assignment with respect to the Leases and the Rents.
ARTICLE III
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FUTURE ADVANCES; LIMITATION ON AMOUNT SECURED
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3.1 FUTURE ADVANCES. This Mortgage is given to secure not only
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Mortgagor's Obligations which exist as of the Closing Date, but also the payment
of any and all Future Advances, whether such Future Advances are obligatory or
are to be made at the option of Mortgagee.
3.2 LIMITATION ON AMOUNT SECURED. The total amount of Indebtedness
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secured by this Mortgage may decrease or increase from time to time, but the
total unpaid balance so secured at one time shall not exceed the sum of (i)
$60,000,000, plus (ii) interest thereon, plus (iii) any Imposts, plus (iv) any
amounts paid by Mortgagee pursuant to Section 10.2 hereof, plus (v) all costs
and expenses incurred by Mortgagee in enforcing its rights and remedies under
this Mortgage, plus (vi) interest on the disbursements described in clauses
(iii), (iv) and (v) preceding, which interest shall be calculated at 12% per
annum.
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ARTICLE IV
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REPRESENTATIONS AND WARRANTIES
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Mortgagor represents and warrants to Mortgagee as follows:
4.1 TITLE. Mortgagor (i) has full legal power and authority to
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mortgage and convey the Premises and (ii) is the holder of fee simple title to
the Premises, free and clear of all Liens except Permitted Liens.
4.2 LOCATION, USE OF PREMISES, IMPROVEMENTS AND EQUIPMENT. The
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location and use of the Premises, the Improvements and the Equipment are in
compliance with all applicable laws, rules, ordinances and regulations,
including, but not limited to, building and zoning laws, and all covenants and
restrictions of record, the failure to comply with which would have a Material
Adverse Effect. No notice of violation of such laws, rules and/or ordinances
has been issued and received by Mortgagor which remains uncorrected.
4.3 CREDIT AGREEMENT. All representations and warranties of
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Mortgagor set forth in the Credit Agreement are true and correct and are deemed
to be remade herein, including, without limitation, those with respect to (i)
Liens, (ii) Hazardous Materials, Environmental Laws and other environmental
matters affecting the Mortgaged Property and (iii) taxes, assessments, levies,
impositions and charges that have been or hereafter may be imposed or assessed
against all or any portion of the Mortgaged Property.
4.4 COPY OF MORTGAGE. Mortgagor has been furnished with a true,
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correct and complete copy of this Mortgage.
4.5 LEGAL COUNSEL. Throughout the transaction contemplated by this
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Mortgage, Mortgagor has retained and has been represented by legal counsel of
its own choosing.
4.6 BUSINESS LOAN. The (i) Loans constitute a business loan
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transaction and (ii) proceeds of such Loans are to be utilized solely for the
purpose of carrying on the business of Mortgagor.
4.7 NO AGRICULTURAL PURPOSES. No part of the Mortgaged Property is
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used principally or primarily for agricultural or farm purposes.
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ARTICLE V
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AFFIRMATIVE COVENANTS
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Until Mortgagor's Obligations are paid and performed in full,
Mortgagor agrees it shall:
5.1 PAYMENT AND PERFORMANCE OF MORTGAGOR'S OBLIGATIONS. Promptly pay
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or perform, or cause to be paid or performed, when due all of Mortgagor's
Obligations.
5.2 MAINTENANCE OF RIGHTS. Maintain the standing, right, power and
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lawful authority to do the following: (i) own good title to the Mortgaged
Property, (ii) carry on the business of and operate the Mortgaged Property,
(iii) enter into, execute and deliver this Mortgage, (iv) convey and assign the
interests of Mortgagor in the Mortgaged Property to Mortgagee, (v) encumber the
Mortgaged Property to Mortgagee as provided herein and (vi) consummate all of
the transactions described in or contemplated by this Mortgage to be consummated
by Mortgagor.
5.3 MAINTENANCE OF PERMITS. Obtain and maintain all Permits where
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the failure to obtain and/or maintain any such Permit would have a Material
Adverse Effect.
5.4 PEACEFUL POSSESSION. Remain in peaceful possession of the
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Mortgaged Property and take all actions necessary to maintain and preserve the
Mortgage Lien.
5.5 PAYMENT OF LIENS. Promptly pay or cause to be paid, as and when
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due and payable or when declared due and payable, any Indebtedness which may
become or be secured by any Lien on any Mortgaged Property and, immediately upon
request by Mortgagee, deliver to Mortgagee evidence satisfactory to Mortgagee of
the payment and discharge thereof.
5.6 REPAIRS. Make all necessary repairs, replacements and renewals
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(including the replacement of any items of Equipment) to the Mortgaged Property
so that the value thereof shall not be impaired, including, without limitation,
repairing, restoring or rebuilding any building or improvement now or hereafter
on the Premises which may become damaged or destroyed, and if any portion of the
Mortgaged Property becomes damaged or destroyed, Mortgagor permit Mortgagee, and
its agents, upon prior notice and demand, access to the Mortgaged Property for
the purpose of inspection thereof.
5.7 BUILDINGS AND IMPROVEMENTS. Pay for and complete, within a
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reasonable time, any building or improvement at any time in the process of being
erected upon the Premises.
5.8 EXECUTION OF DOCUMENTS. Immediately upon request by Mortgagee,
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at Mortgagor's sole expense, make, execute and deliver and/or cause to be made,
executed and delivered to Mortgagee, in form and substance acceptable to
Mortgagee, all Documents that Mortgagee deems necessary to evidence, document
and/or conclude the transactions described in
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and/or contemplated by this Mortgage, or reasonably required to perfect or
continue perfected the Mortgage Lien.
5.9 COMPLIANCE WITH LAWS. Comply with all applicable laws, rules,
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ordinances and regulations, including, without limitation, building and zoning
laws, and all covenants and restrictions of record, the failure to comply with
which would have a Material Adverse Effect.
5.10 CREDIT AGREEMENT. Comply with all covenants, agreements and
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indemnifications contained in the Credit Agreement, including those with respect
to (i) taxes, assessments, levies, impositions and charges as they relate to
Mortgagor or the Mortgaged Property, (ii) delivery of financial statements,
reports and other information, (iii) insurance policies to be maintained for the
Mortgaged Property and the settlement, receipt and application of insurance
proceeds arising under such insurance policies and (iv) Hazardous Materials,
Environmental Laws and other environmental matters as they relate to Mortgagor
or the Mortgaged Property.
5.11 STAMP TAX; EFFECT OF CHANGE IN LAWS REGARDING TAXATION.
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5.11.1 PAYMENT OF STAMP TAX. If, by the laws of the United States of
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America or of any state or subdivision thereof having jurisdiction over
Mortgagor, any tax is due or becomes due in respect of the issuance of the Notes
or the recording of this Mortgage or the Credit Agreement and the Related
Documents and unless such laws prohibit Mortgagor from paying such tax, (i) pay
such tax in the manner required by any such law and (ii) reimburse Mortgagee for
any sums which Mortgagee may expend by reason of the imposition of any tax on
the issuance of the Notes.
5.11.2 PAYMENT OF TAXES IMPOSED ON MORTGAGEE. In the event of the
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enactment, after this date, of any law, statute, rule or regulation of the
United States of America or of the State in which the Premises are located or
any other state or subdivision thereof imposing upon Mortgagee the payment of
the whole or any part of the taxes, assessments or Liens herein required to be
paid by Mortgagor, or changing in any way the laws relating to the taxation of
mortgages or debts secured by mortgages or Mortgagee's interest in the Premises
or any other portion of the Mortgaged Property, or the manner of collection of
taxes, so as to affect this Mortgage or Mortgagor's Obligations or the holder
thereof, then, and in any such event, upon demand by Mortgagee, pay such taxes
or assessments or reimburse Mortgagee therefor; provided, however, that if the
opinion of counsel for Mortgagee, (i) it might be unlawful to require Mortgagor
to make such payment, or (ii) the making of such payment might result in the
imposition of interest beyond the maximum amount permitted by law, then and in
any such event, Mortgagee may elect, by notice in writing given to Mortgagor, to
declare all of Mortgagor's Obligations to be and become due and payable thirty
(30) days from the date of giving of such notice.
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ARTICLE VI
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NEGATIVE COVENANTS
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Until Mortgagor's Obligations are paid and performed in full,
Mortgagor agrees it will not:
6.1 ADDITIONAL LIMITATIONS. Execute, file or record any notice
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limiting the maximum principal amount that may be secured by this Mortgage.
6.2 SALE OR TRANSFER. Sell, transfer, exchange, convey, remove or
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otherwise dispose of all or any portion of the Mortgaged Property or legal or
equitable interest therein, except to the extent permitted by the Credit
Agreement.
6.3 LIENS. Permit any Liens to exist on the Mortgaged Property
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except (i) Permitted Liens, and (ii) Leases, if any.
6.4 USE OF MORTGAGED PROPERTY. Substantially or materially change
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the use or character of any portion of the Mortgaged Property, permit any
excavation, construction, site work or other lienable work to be performed on
any portion of the Mortgaged Property, initiate or acquiesce in any zoning
variation or reclassification of any portion of the Mortgaged Property or commit
or suffer any waste to exist on any portion of the Mortgaged Property.
6.5 INSURANCE. Purchase any separate insurance concurrent in form or
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contributing in the event of loss with that required to be maintained under the
Credit Agreement and the Related Documents unless (i) Mortgagee receives prompt
notice thereof and is included thereon under a standard non-contributory
mortgagee clause acceptable to Mortgagee, (ii) such separate insurance otherwise
complies with all of the requirements of the Credit Agreement and the Related
Documents and (iii) Mortgagor delivers to Mortgagee promptly the original policy
or policies of such insurance.
ARTICLE VII
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INSURANCE
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7.1 ADJUSTMENT OF LOSSES; COLLECTION OF PROCEEDS. In case of loss or
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damage by fire or other insured casualty to all or any portion of the Mortgaged
Property, Mortgagee is authorized and empowered to (i) make or file proofs of
loss, and settle and adjust any claim under insurance policies which insure
against such risks, or (ii) direct Mortgagor to agree with each insurance
company on the amount to be paid as a result of such loss. If the insurance
proceeds paid for such loss are equal to or less than $10,000, Mortgagor may
collect such proceeds so long as (x) Mortgagor uses such proceeds to repair,
restore or rebuild the Mortgaged Property, in such manner and under such
conditions as Mortgagee may require and (y) no Event of Default or
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Unmatured Event of Default exists. If the insurance proceeds paid for such loss
are greater than $10,000, or if an Unmatured Event of Default or Event of
Default then exists, then Mortgagee is authorized to collect such proceeds.
7.2 APPLICATION OF PROCEEDS. Mortgagee may elect (i) to apply
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insurance proceeds received by Mortgagee to the payment of Mortgagor's
Obligations, whether or not then due, or (ii) after the payment of all expenses
incurred by Mortgagee in connection with the collection of such insurance
proceeds, including, without limitation, attorneys' fees, to make such insurance
proceeds available to Mortgagor for repair, restoration or rebuilding of the
Mortgaged Property, in such manner and under such conditions as Mortgagee may
require. In the event that Mortgagee has permitted the insurance proceeds to be
used to restore the Mortgaged Property, Mortgagor shall (x) pay the amount of
any deficiency in such insurance proceeds in order to restore the Mortgaged
Property fully to its condition immediately prior to the loss or damage to which
such insurance proceeds relate and (y) deliver to Mortgagee any surplus which
may remain out of such proceeds after payment of the cost of restoration to be
applied to the payment of Mortgagor's Obligations.
7.3 FAILURE TO COLLECT PROCEEDS. Mortgagee shall not be held
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responsible for (i) any failure to collect any insurance proceeds due under the
terms of any policy, regardless of the cause of such failure, (ii) the amount of
any such proceeds ultimately paid, regardless of any negotiation by Mortgagee of
such amount, or (iii) any use by Mortgagor of such proceeds as Mortgagee may pay
over to Mortgagor.
ARTICLE VIII
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CONDEMNATION
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8.1 NOTICE; ASSIGNMENT OF PROCEEDS. Mortgagor shall notify Mortgagee
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immediately of the institution or threat of institution of any proceeding
pertaining to the condemnation of any portion of the Mortgaged Property.
Mortgagee is authorized to settle all claims for damages to any portion of the
Mortgaged Property which relate to, and collect any proceeds of any award which
may be the result of, any eminent domain or condemnation proceeding.
8.2 APPLICATION OF PROCEEDS. Mortgagee may elect (i) to apply the
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proceeds of the award or claim received by Mortgagee described in Section 8.1 to
the payment of Mortgagor's Obligations in accordance with the provisions of the
Credit Agreement, whether due or not, or (ii) after the payment of all expenses
incurred by Mortgagee in connection with the collection of such proceeds,
including, without limitation, attorneys' fees, to make such proceeds available
to Mortgagor for replacement of the condemned portion of the Mortgaged Property,
in such manner and under such conditions as Mortgagee may require. In the event
that Mortgagee has permitted the proceeds of the award or claim to be used to
replace the condemned portion of the Mortgaged Property, Mortgagor shall (x) pay
the amount of any deficiency in such proceeds in order to complete such
replacement and (y) deliver to Mortgagee any surplus which may remain out of
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such proceeds after payment of the cost of replacement to be applied to the
payment of Mortgagor's Obligations.
8.3 FAILURE TO COLLECT PROCEEDS. Mortgagee shall not be held
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responsible for (i) any failure to collect any condemnation proceeds, regardless
of the cause of such failure, (ii) the amount of any such proceeds ultimately
paid, regardless of any negotiation by Mortgagee of such amount, or (iii) any
use by Mortgagor of such proceeds as Mortgagee may pay over to Mortgagor.
ARTICLE IX
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LEASES AND RENTS
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9.1 LICENSE TO COLLECT. Subject to Mortgagee's rights under Article
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XI, Mortgagee hereby confers upon Mortgagor a non-exclusive license to collect
and retain the Rents as they become due and payable.
9.2 RENT ROLL, COPIES OF LEASES. Upon Mortgagee's request, Mortgagor
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shall deliver to Mortgagee (i) a rent roll pertaining to all Leases, (ii) copies
of all Leases and (iii) such other matters and information relating to any Lease
as Mortgagee may request.
ARTICLE X
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CERTAIN RIGHTS OF MORTGAGEE
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10.1 DOCUMENTS. In case Mortgagor fails to execute or obtain any
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Documents required by Mortgagee for the perfection or continuation of the
Mortgage Lien, Mortgagor hereby appoints Mortgagee as its true and lawful
attorney-in-fact to execute or obtain any such Documents on its behalf.
10.2 MAINTENANCE OF MORTGAGED PROPERTY. If Mortgagor, within thirty
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(30) days after receipt of written demand from Mortgagee (except in cases of
emergency, when no demand shall be required), shall neglect or refuse to (i)
keep the Mortgaged Property in good operating condition and repair, (ii) replace
or maintain the same as herein agreed, (iii) pay the premiums for the insurance
which is required to be maintained hereunder, (iv) pay and discharge all Liens
as herein agreed or (v) otherwise perform Mortgagor's Obligations within the
time periods specified therefor (including any applicable cure periods),
Mortgagee, at its option and sole election, may cause such repairs or
replacements to be made, obtain such insurance, pay such Liens or perform such
Mortgagor's Obligations. Any amounts paid by Mortgagee in taking such action,
together with interest thereon at the Default Rate until repaid by Mortgagor to
Mortgagee, shall be due and payable by Mortgagor to Mortgagee upon demand, and,
until paid, shall constitute a part of Mortgagor's Obligations secured by this
Mortgage. Mortgagee shall not be
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liable to Mortgagor for failure or refusal to exercise any such right. In making
any payments pursuant to the exercise of any such right, Mortgagee may rely upon
any bills delivered to it by Mortgagor or any such payee.
ARTICLE XI
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DEFAULT AND REMEDIES
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The occurrence of an Event of Default under the Credit Agreement shall
constitute an Event of Default under this Mortgage. Upon the occurrence of an
Event of Default, Mortgagee, in its sole discretion and at its sole election,
without notice of such election, and without further demand, may exercise any
one or more of the following rights and remedies:
11.1 ACCELERATION. Mortgagee may declare all of Mortgagor's
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Obligations immediately due and payable, whereupon Mortgagor's Obligations
immediately shall mature and become due and payable.
11.2 OTHER REMEDIES. To the extent permitted by applicable law,
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Mortgagee may exercise any one or more of the following remedies, whether or not
Mortgagor's Obligations have been accelerated:
11.2.1 TAKING OF POSSESSION. Mortgagee, by itself or by such officers
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or agents as it may appoint, may enter and take exclusive possession of all or
any part of the Mortgaged Property, including all books, papers and accounts of
Mortgagor relating to the business of Mortgagor conducted at such Mortgaged
Property, and may expel, remove and exclude Mortgagor, its agents and employees
and any persons, goods and chattels occupying the Mortgaged Property. If
Mortgagor for any reason fails to surrender or deliver the Mortgaged Property or
any part thereof after such demand by Mortgagee, Mortgagee may obtain a judgment
or decree conferring on Mortgagee the right to immediate possession or requiring
the delivery to Mortgagee of the Mortgaged Property, and Mortgagor specifically
consents to the entry of such judgment or decree. Upon every such taking of
possession, Mortgagee may (i) hold, store, use, operate, manage and control the
Mortgaged Property and conduct the business of Mortgagor thereon, (ii) perform
all necessary and proper maintenance and make all necessary and proper repairs,
renewals, replacements, additions, betterments and improvements thereto and
thereon and purchase or otherwise acquire additional fixtures, personalty and
other Property, (iii) keep the Mortgaged Property insured, (iv) manage and
operate the Mortgaged Property and exercise all of the rights and powers of
Mortgagor to the same extent as Mortgagor could in its own name, (v) enter into
any agreements with respect to the exercise by others of any of the powers
granted to Mortgagee herein, in such manner as Mortgagee shall elect, (vi)
collect and receive all of the Rents, including those past due as well as those
accruing after the occurrence of any such Event of Default and (vii) after
deducting (A) all expenses of taking, holding, holding, managing and operating
the Mortgaged Property
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(including compensation for the services of all Persons employed for such
purposes), (B) the cost of all such maintenance, repairs, renewals,
replacements, additions, betterments, improvements and purchases and
acquisitions, (C) the cost of such insurance, (D) such taxes, assessments and
other similar charges as Mortgagee may determine to pay, (E) other proper
charges upon the Mortgaged Property or any part thereof and (F) the
compensation, expenses and disbursements of the attorneys and agents of
Mortgagee, apply the remainder of the monies and proceeds so received by
Mortgagee as described in Section 11.8hereof.
11.2.2 DEPOSITS FOR TAXES AND INSURANCE. Mortgagee may require
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Mortgagor to deposit with Mortgagee, commencing 10 days following such request
and on the first day of each month thereafter, a sum equal to the amount of all
insurance premiums next due in respect of the insurance policies required to be
maintained under the Credit Agreement and the Related Documents and all general
and special real estate taxes and assessments next due upon or for the Mortgaged
Property (the amount of such insurance premiums, taxes and assessments next due
to be based upon Mortgagee's reasonable estimate, but shall include all taxes or
assessments not levied, charged, assessed or imposed separately upon the
Mortgaged Property), reduced by the amount, if any, then on deposit with
Mortgagee for such purpose, divided by the number of months to elapse before one
month prior to the date when such insurance premiums, taxes and assessments will
become due and payable. If such Deposits are insufficient to pay any such
insurance premiums, taxes or assessments when the same become due and payable,
Mortgagor, within 10 days after receipt of demand therefor from Mortgagee, shall
deposit such additional funds as may be necessary to pay such insurance premiums
in full. If such Deposits exceed the amount required to pay such insurance
premiums, taxes or assessments for any year, the excess shall be credited
against the next succeeding deposit or deposits to be made by Mortgagor. Such
Deposits need not be kept separate and apart from any other funds of Mortgagee,
shall be held without any allowance of interest to Mortgagor and shall be used
for the payment of insurance premiums, taxes and assessments on the Mortgaged
Property next due and payable when they become due; provided that Mortgagee
shall not be liable for any failure to apply such Deposits to the payment of
such insurance premiums, taxes and assessments unless Mortgagee shall have
received from Mortgagor a request for payment accompanied by the bills for such
insurance premiums, taxes and assessments not less than thirty daysprior to the
date due.
11.2.3 LEASES AND RENTS. Mortgagee may, with or without taking
----------------
possession of the Mortgaged Property, as attorney and agent-in-fact for
Mortgagor constituted and appointed by Mortgagor with full power of substitution
(which power is coupled with an interest and is irrevocable), in the name of
Mortgagor, Mortgagee, or both:
(a) demand, collect, settle, adjust, compromise, and enforce, by legal
proceedings or otherwise, payment of the Rents, endorse the name of Mortgagor
upon any payments or proceeds of the Rents and deposit the same for the account
13
of Mortgagee and do all other acts and things necessary, in Mortgagee's sole
discretion, to obtain control and use of the Rents;
(b) terminate the license granted to Mortgagor hereunder to collect
the Rents and thereafter Mortgagee shall have all right, title and interest in
and to the Leases and the Rents by virtue of the present assignment thereof
granted to Mortgagee hereunder;
(c) require Mortgagor to deliver to Mortgagee the originals of the
Leases, with appropriate endorsement and/or other specific evidence of
assignment thereto to Mortgagee, which endorsement and/or assignment shall be in
form and substance acceptable to Mortgagee;
(d) notify any of the obligors under the Leases that the Leases have
been assigned to Mortgagee and direct such obligors thereafter to make all
payments due from them under the Leases directly to Mortgagee; and
(e) require Mortgagor to direct all obligors of the Leases to make all
payments due them under the Leases directly to Mortgagee.
Notwithstanding anything in this subsection 11.2.3 to the contrary,
under no circumstances shall Mortgagee have any duty to produce Rents from the
Mortgaged Property. Regardless of whether or not Mortgagee, in person or by
agent, takes actual possession of the Premises and Improvements, Mortgagee is
not and shall not be deemed to be (i) a "mortgagee in possession" for any
purpose; (ii) responsible for performing any of the obligations of the lessor
under any Lease; (iii) responsible for any waste committed by lessees or any
other parties, any dangerous or defective condition of the Mortgaged Property,
or any negligence in the management, upkeep, repair or control of the Mortgaged
Property; or (iv) liable in any manner for the Mortgaged Property or the use,
occupancy, enjoyment or operation of all or any part thereof.
11.2.4 APPOINTMENT OF RECEIVER. Upon application to a court of
-----------------------
competent jurisdiction, Mortgagee may appoint a receiver to take possession of
and to operate the Mortgaged Property and to collect and apply the Rents,
without notice and without regard to the occupancy or value of any security for
Mortgagor's Obligations or the solvency of Mortgagor. The receiver shall have
all rights and powers necessary or usual for the protection, possession,
control, management and operation of the Mortgaged Property during the period of
receivership, to the fullest extent permitted by law.
11.2.5 OTHER REMEDIES. Mortgagee may exercise any other rights and
--------------
remedies then available to Mortgagee under this Mortgage, the Notes, the Credit
Agreement and the other Related Documents and any applicable laws.
14
11.3 REMEDIES UPON ACCELERATION. If Mortgagor's Obligations have
--------------------------
been accelerated pursuant to Section 11.1, in addition to Mortgagee's rights
under Section 11.2, Mortgagee may exercise any one or more of the following
remedies:
11.3.1 COMMENCE FORECLOSURE PROCEEDINGS. Mortgagee may commence a
--------------------------------
civil action to foreclose the Mortgage Lien for payment of Mortgagor's
Obligations, or any part thereof, and obtain an order or judgment of foreclosure
and sale of the Mortgaged Property. In any civil action to foreclose the
Mortgage Lien or otherwise enforce Mortgagee's rights, there shall be allowed
and included as part of Mortgagor's Obligations in the order or judgment for
foreclosure and sale (or other order), all expenditures and expenses which may
be paid or incurred by or on behalf of Mortgagee for attorneys' fees, costs and
expenses, appraiser's fees, engineer's fees, out-lays for documentary and expert
evidence, receiver's fees, stenographers' charges, publication costs, and costs
(which may be estimates as to items to be expended after entry of such order or
judgment) of procuring all such abstracts of title, title searches and
examinations, title insurance policies and similar data and assurances with
respect to the title of the Mortgaged Property as Mortgagee may deem necessary
either to prosecute such civil action or to evidence to bidders at any sale
which may be had pursuant to such order or judgment the true condition of the
title to, or the value of, the Mortgaged Property.
11.3.2 BID AT FORECLOSURE SALE. Mortgagee may bid for and purchase
-----------------------
the Mortgaged Property at any foreclosure sale and apply all or any part of
Mortgagor's Obligations as a credit to the purchase price in lieu of paying cash
therefor.
11.3.3 RIGHTS UNDER UNIFORM COMMERCIAL CODE. Mortgagee may exercise
------------------------------------
all of the rights and remedies of a secured party under the Uniform Commercial
Code of the State in which the Premises are located with respect to the
Collateral. Pursuant to Section 9-501(4) of such Uniform Commercial Code,
Mortgagee shall have an option to proceed with respect to both the real property
portion of the Mortgaged Property and the Collateral, in accordance with its
rights, powers and remedies with respect to the real property, in which
event the remedy and enforcement provisions of this Mortgage in lieu of the
remedy and enforcement provisions of such Uniform Commercial Code shall apply.
Such Section 9-501(4) also permits Mortgagee to proceed separately against the
Collateral in accordance with the remedy and enforcement provisions of such
Uniform Commercial Code. If Mortgagee shall elect to proceed against the
Collateral separately from any proceeding with respect to the real property,
Mortgagor agrees that 10 days notice of the sale of the Collateral shall be
reasonable notice.
11.3.4 STATE STATUTES. Mortgagee may exercise all rights and remedies
--------------
under the statutes in the State where the Premises are located, subject to the
following:
(a) if any provision in this Mortgage is inconsistent with any
applicable statute in the State where the Premises are located, such statute
shall take precedence over the provisions of this Mortgage, but shall not
invalidate or render
15
unenforceable any other provision of this Mortgage that can be construed in a
manner consistent with such statute; and
(b) if any provision of this Mortgage shall grant to Mortgagee any
rights or remedies upon default of Mortgagor which are more limited than the
rights that otherwise would be vested in Mortgagee under such statute in the
absence of such provision, Mortgagee shall be vested with the rights granted in
such statute to the full extent permitted by law.
Without limiting the generality of the foregoing, all expenses
incurred by Mortgagee to the extent reimbursable under such statute, whether
incurred before or after any decrees or judgment of foreclosure, and whether or
not provided for elsewhere in this Mortgage, shall be added to Mortgagor's
Obligations or to the judgment of foreclosure, as described more fully in
Section 11.4.
11.4 ADDITIONS TO MORTGAGOR'S OBLIGATIONS. Upon the occurrence of an
------------------------------------
Event of Default, there will be added to and included as part of Mortgagor's
Obligations (and allowed in any sale or decree for sale of the Mortgaged
Property or in any judgment rendered upon this Mortgage, the Notes, the Credit
Agreement or the other Related Documents) all of the costs and expenses incurred
by Mortgagee in exercising its rights and remedies under this Mortgage. All of
such costs and expenses, including attorneys' fees, shall (i) be secured by this
Mortgage, (ii) be payable upon demand and (iii) bear interest at the Default
Rate from the date incurred by Mortgagee until paid.
11.5 PROCEEDINGS DISCONTINUED. In case Mortgagee shall have proceeded
------------------------
to enforce any right under this Mortgage by foreclosure, entry or otherwise and
such proceedings shall have been discontinued or abandoned for any reason, or
shall have been determined adversely to Mortgagee, then, except as otherwise
determined in such proceeding, Mortgagor and Mortgagee shall be restored to
their former positions and rights hereunder with respect to the Mortgaged
Property, and all rights, remedies, and powers of Mortgagee shall continue as
though no such proceedings had been commenced.
11.6 DEFICIENCY.
----------
11.6.1 SALE AND FORECLOSURE. If the Mortgaged Property (or any part
--------------------
thereof which remains subject to this Mortgage) is sold pursuant to foreclosure
proceedings, and if the net proceeds of any such sale are not sufficient to pay
all of Mortgagor's Obligations then outstanding and any other amounts provided
for in any the decree or judgment of foreclosure or provided for by applicable
law (the amount of such deficiency and the deficiency described in subsection
11.6.2 hereinafter collectively referred to as the "BALANCE OWED"), then the
Indebtedness evidenced by the Notes shall not be satisfied to the extent of the
Balance Owed, but such Indebtedness shall continue in existence and shall
continue to be evidenced by the Notes and shall continue to be secured by the
Credit Agreement and the Related Documents which were in existence prior to any
such decree or
16
judgment of foreclosure, except this Mortgage. Subject to the requirements of
applicable law, if Mortgagee shall acquire the Mortgaged Property as a result of
any such foreclosure sale (whether by bidding all or any of Mortgagor's
Obligations or otherwise), the proceeds of such sale shall not be deemed to
include (and Mortgagor shall not be entitled to any benefit or credit on account
of) proceeds of any subsequent sale of the Mortgaged Property by Mortgagee.
11.6.2 FORECLOSURE OF OTHER CREDIT AGREEMENT AND THE RELATED
-----------------------------------------------------
DOCUMENTS. Notwithstanding the provisions of subsection 11.6.1, Mortgagor
further agrees that if any other portion of the Collateral is foreclosed
judicially and such Collateral is sold pursuant to foreclosure proceedings, and
if the proceeds of such sale (after application of such proceeds as provided for
herein and after deducting all accrued and general and special taxes and
assessments) are not sufficient to pay Mortgagor's Obligations and any other
amounts provided for in the decree or judgment of foreclosure or provided for by
applicable law, then Mortgagor's Obligations then outstanding shall not be
satisfied to the extent of such Balance Owed, but such Indebtedness shall
continue in existence and continue to be evidenced by the Notes and shall
continue to be secured by this Mortgage, the Credit Agreement and the other
Related Documents, which were in existence immediately prior to any such decree
or judgment of foreclosure, except each such Loan Instrument which pertains to
the portion of the Collateral which was the subject of any such foreclosure
sale.
11.8 APPLICATION OF PROCEEDS. The proceeds of any foreclosure sale
-----------------------
of the Mortgaged Property or any other proceeds received hereunder shall be
applied in accordance with the provisions of SECTION 9.7 OF THE CREDIT
AGREEMENT.
ARTICLE XII
-----------
RECONVEYANCE
------------
Mortgagee shall release the Mortgaged Property, or such portion
thereof as previously shall not have been sold pursuant to the terms of this
Mortgage, by proper instrument upon payment and discharge of all of Mortgagor's
Obligations.
ARTICLE XIII
------------
MISCELLANEOUS
-------------
13.1 NOTICES. All notices and communications under this Mortgage
-------
shall be in writing and, if (a) forwarded by mail shall be deemed to have been
given three days after the date sent if sent by registered or certified mail,
postage prepaid, and:
17
(i) if to Mortgagor, addressed to Mortgagor at its address first set
forth above; or
(ii) if to Mortgagee, addressed to Mortgagee at its address first set
forth above; or
in the case of any party, at such other address as such party may, by written
notice received by the other parties to this Mortgage, have designated as its
address for notices; and (b) notices given by telegram, telex or facsimile
transmission shall be deemed to have been given when sent if addressed to the
party to whom sent, at its address as aforesaid, or to any other address, as to
any such party, as such party shall designate in a written notice to the other
party hereto. All notices sent pursuant to the terms of this Section 13.1 shall
be deemed received (i) if personally delivered, then on the date of delivery,
(ii) if sent by overnight, express carrier, on the next Business Day immediately
following the day sent, or (iii) if sent by registered or certified mail, on the
earlier of the fifth Business Day following the day sent or when actually
received.
13.2 COVENANTS RUN WITH LAND. All the covenants contained in this
-----------------------
Mortgage shall run with the land. Time is of the essence for the performance by
Mortgagor of its obligations under this Mortgage.
13.3 GOVERNING LAW. THIS MORTGAGE SHALL BE CONSTRUED IN ACCORDANCE
-------------
WITH AND GOVERNED AS TO VALIDITY, INTERPRETATION, CONSTRUCTION, EFFECT AND IN
ALL OTHER RESPECTS BY THE LAWS AND DECISIONS OF THE STATE OF ILLINOIS, EXCEPT
THAT THE LAWS OF THE STATE WHERE THE PREMISES ARE LOCATED SHALL APPLY TO THE
CREATION, PRIORITY, PERFECTION AND MAINTENANCE OF THE MORTGAGE LIEN AND TO THE
ENFORCEMENT OF THE REMEDIES OF MORTGAGEE HEREUNDER AND ANY OF ITS SUCCESSORS AND
ASSIGNS.
13.4 JURISDICTION AND VENUE. SUBJECT TO THE PROVISIONS OF ANY
----------------------
APPLICABLE STATUTE IN THE STATE WHERE THE PREMISES ARE LOCATED, MORTGAGOR AGREES
THAT MORTGAGEE MAY ENFORCE ANY CLAIM ARISING OUT OF THIS MORTGAGE IN ANY STATE
OR FEDERAL COURT HAVING SUBJECT MATTER JURISDICTION AND LOCATED IN CHICAGO,
ILLINOIS. FOR THE PURPOSE OF ANY ACTION OR PROCEEDING INSTITUTED WITH RESPECT
TO ANY SUCH CLAIM, MORTGAGOR HEREBY IRREVOCABLY DESIGNATES CT CORPORATION
SYSTEM, WITH OFFICES ON THE DATE HEREOF AT ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇, TO RECEIVE FOR AND ON BEHALF OF MORTGAGOR SERVICE OF PROCESS IN
ILLINOIS. MORTGAGOR FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT
OF SUCH COURTS BY MAILING A COPY THEREOF, POSTAGE PREPAID, TO MORTGAGOR AND
AGREES THAT SUCH SERVICE, TO THE FULLEST EXTENT PERMITTED BY LAW, (i) SHALL BE
DEEMED IN EVERY RESPECT EFFECTIVE SERVICE OF PROCESS UPON IT IN ANY SUCH SUIT,
ACTION OR PROCEEDING AND (ii) SHALL BE TAKEN AND HELD TO BE PERSONAL SERVICE
UPON AND PERSONAL DELIVERY TO IT. NOTHING HEREIN CONTAINED SHALL AFFECT THE
RIGHT
18
OF AGENT OR ANY LENDER TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR
PRECLUDE AGENT OR ANY LENDER FROM BRINGING AN ACTION OR PROCEEDING IN RESPECT OF
THIS MORTGAGE IN ANY OTHER COUNTRY, STATE OR PLACE HAVING JURISDICTION OVER SUCH
ACTION. MORTGAGOR HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
LAW, ANY OBJECTION WHICH IT MAY HAVE OR HEREAFTER HAVE TO THE LAYING OF THE
VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT LOCATED
IN CHICAGO, ILLINOIS AND ANY CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDING
BROUGHT IN SUCH A COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
13.5 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY EXPRESSLY WAIVES
--------------------
ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND
ANY RIGHTS UNDER THIS AGREEMENT OR ANY RELATED DOCUMENT TO WHICH IT IS A PARTY,
OR UNDER ANY AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR WHICH MAY
IN THE FUTURE BE DELIVERED IN CONNECTION THEREWITH OR ARISING FROM ANY
RELATIONSHIP EXISTING IN CONNECTION WITH THIS AGREEMENT OR ANY RELATED DOCUMENT,
AND AGREES THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND
NOT BEFORE A JURY.
13.6 SUCCESSORS AND ASSIGNS. This Mortgage will be binding upon and
----------------------
inure to the benefit of the successors and assigns of each of Mortgagor and
Mortgagee.
13.7 SEVERABILITY. Any provision of this Mortgage that is
------------
unenforceable in any state in which this Mortgage may be filed or recorded or is
invalid or contrary to the law of such state, shall be of no effect, and in such
case all the remaining terms and provisions of this Mortgage shall continue to
be fully effective in accordance with the terms and provisions of this Mortgage,
all as though no such invalid portion ever had been included herein.
13.8 REMEDIES CUMULATIVE. All rights and remedies of Mortgagee
-------------------
under this Mortgage, the other Credit Agreement and any of the other Related
Documents are cumulative and concurrent and may be exercised singularly,
successively or concurrently and Mortgagee shall have all rights, remedies and
recourse available at law or equity.
13.9 SUBROGATION. To the extent that any of Mortgagor's Obligations
-----------
represent funds utilized to satisfy any outstanding Indebtedness secured by
Liens against all or any part of the Mortgaged Property, to the extent permitted
thereby and by applicable law, Mortgagee shall be subrogated to any and all
Liens owned or claimed by the holder of any such outstanding Indebtedness so
satisfied, regardless of whether such Liens are assigned to Mortgagee or
released by the holder(s) thereof.
19
13.10 INDEMNIFICATION. Mortgagor will save and hold Mortgagee
---------------
harmless of and from any and all damage, loss, cost and expense, including, but
not limited to, attorneys' fees, costs and expenses, incurred by reason of or
arising from or on account of or in connection with any suit or proceeding
threatened, filed and/or pending brought by anyone other than Mortgagee, in or
to which Mortgagee is or may become a party by reason of or arising from
Mortgagor's Obligations, this Mortgage, the Credit Agreement and any of the
other Related Documents.
13.11 CONFLICTS. In the event of any conflict or inconsistency
---------
between the terms of this Mortgage and the terms of the Credit Agreement, the
terms of the Credit Agreement shall prevail.
13.12 NO PARTNER, JOINT VENTURER. Mortgagor and Mortgagee agree that
--------------------------
in no event shall Mortgagee be deemed to be a partner or a joint venturer with
Mortgagor. Without limiting the foregoing, Mortgagee shall not be deemed to be
such a partner or joint venturer on account of becoming a mortgagee in
possession or exercising any rights pursuant to this Mortgage or pursuant to any
other instrument or document evidencing or securing any of Mortgagor's
Obligations.
13.13 WAIVERS. Mortgagor, on behalf of itself, its successors and
-------
assigns, to the extent permitted by law, hereby (i) waives any and all rights of
appraisement, valuation, stay, extension and (to the extent permitted by law)
redemption from sale under any order or decree of foreclosure of this Mortgage,
(ii) waives any equitable, statutory or other right available to it, pertaining
to marshalling of assets hereunder, so as to require the separate sales of
interests in the Mortgaged Property before proceeding against any other interest
in the Mortgaged Property, (iii) consents to and authorizes, at the option of
Mortgagee, the sale, either separately or together, of any and all interests in
the Mortgaged Property, (iv) agrees that in no event shall Mortgagee be required
to allocate any proceeds received by Mortgagee from foreclosure sale or
otherwise, to any particular interest in the Mortgaged Property and (v) agrees
that when a sale is consummated under any decree of foreclosure of this
Mortgage, upon confirmation of such sale, the master in chancery, the sheriff or
other Person making such sale, or his successor in office, shall be and is
authorized immediately to execute and deliver to the purchaser at such sale a
deed conveying the Mortgaged Property, showing the amount paid therefor, or if
purchased by the Person in whose favor the order or decree is entered, the
amount of his bid therefor.
13.14 REMEDIES NOT EXCLUSIVE. No right or remedy of Mortgagee
----------------------
hereunder is exclusive of any other right or remedy hereunder or now or
hereafter existing at law or in equity or under the Notes, the Credit Agreement
or any of the other Related Documents, but is cumulative and in addition thereto
and Mortgagee may recover judgment thereon, issue execution therefor, and resort
to every other right or remedy available at law or in equity or under the Notes,
the Credit Agreement or any of the other Related Documents, without first
exhausting or affecting or impairing the security or any right or remedy
afforded this Mortgage. No delay in exercising, or omission to exercise, any
such right or remedy will impair any such right or remedy or will be construed
to be a waiver of any default by Mortgagor hereunder, or acquiescence therein,
and such waiver will not affect any subsequent default hereunder by Mortgagor of
the same or different nature. Every such right or remedy may be exercised
independently or concurrently,
20
and when and so often as may be deemed expedient by Mortgagee. No term or
condition contained in this Mortgage may be waived, altered or changed except as
evidenced in writing signed by Mortgagor and Mortgagee.
13.15 NO WAIVER BY MORTGAGEE. Any failure of Mortgagee to insist
----------------------
upon the strict performance by Mortgagor of any of the terms and provisions of
this Mortgage shall not be deemed to be a waiver of any such terms and
provisions, and Mortgagee, notwithstanding any such failure, shall have the
right at any time thereafter to insist upon the strict performance by Mortgagor
of any and all of the terms and provisions hereof.
13.16 NO RELEASE. Except as may be provided otherwise by applicable
----------
law, neither Mortgagor, nor any other Person now or hereafter obligated for the
payment of the whole or any part of Mortgagor's Obligations, shall be relieved
of such obligation by reason of (i) the sale, conveyance or other transfer of
the Mortgaged Property, (ii) the failure of Mortgagee to comply with any request
of Mortgagor, or of any other Person, to take action to foreclose this Mortgage
or otherwise enforce any of the provisions of this Mortgage, the Notes, the
Credit Agreement or any of the other Related Documents, (iii) the release,
regardless of consideration, of the whole or any part of the Collateral, or (iv)
any agreement or stipulation between any subsequent owner of the Mortgaged
Property and Mortgagee extending the time of payment under or modifying the
terms of the Notes, the Credit Agreement, any of the other Related Documents or
this Mortgage without first having obtained the consent of Mortgagor or such
other Person. If Mortgagee shall enter into any agreement described in clause
(iv) hereof, then, notwithstanding any such agreement, Mortgagor and all such
other Persons shall continue to be liable on account of Mortgagor's Obligations
and shall continue to make such payments according to the terms of any such
agreement of extension or modification unless expressly released and discharged
in writing by Mortgagee.
13.17 RELEASE OF SECURITY. Mortgagee, without notice, may release,
-------------------
regardless of consideration, any part of the Collateral, without impairing or
affecting the Mortgage Lien of or the priority of such Mortgage Lien over any
subordinate Lien.
[remainder of this page intentially left blank]
21
IN WITNESS WHEREOF, this Mortgage, Assignment of Leases and Rents, and
Security Agreement has been duly executed by Mortgagor by its duly authorized
representative as of the day and year first above written.
MIKOHN GAMING CORP., a Nevada
corporation
By: /s/ ▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------
Name: ▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------
Title : EVP
---------------------
22
STATE OF NEVADA)
) SS:
COUNTY OF ▇▇▇▇▇)
On this 23rd day of October, 1997, before me, a Notary Public in and
for the State of Illinois, in the County aforesaid, personally appeared Don lW.
▇▇▇▇▇▇▇, to me known to be the E. Vice Pres. of Mikohn Gaming Corp., a Nevada
corporation, the corporation that executed the foregoing instrument, and upon
oath did depose that he is the E. Viec Pres. of such corporation, that the
signature to said instrument was made by the Ev. Vice Pres. of said corporation
as indicated after said signature, and that the corporation executed the said
instrument freely and voluntarily for the uses and purposes therein mentioned.
IN WITNESS WHEREOF, I have hereunto set my hand and official seal the
day and year first above written.
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------------------
NOTARY PUBLIC in and for said State and
County
My commission expires: _________________
THIS DOCUMENT PREPARED BY AND
AFTER RECORDING RETURN TO:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇
▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
23
EXHIBIT A
---------
LEGAL DESCRIPTION
DESCRIPTION NO. 1
Lots C, D, E, and F and that portion of Lots 15 through 18 and Lots through 40
lying north of the Chicago and North Western Railroad right-of-way in Block 6 of
Riverside Addition to the City of Rapid City, ▇▇▇▇▇▇▇▇▇▇ County, South Dakota;
INCLUDING the east 5 feet of the north 10 feet of Lot 37 and the north 10 feet
of Lots 38, 39 and 40 in said Block 6; BUT EXCEPTING the north 10 feet of Lots
33, 34, 35 and 36 and the west 20 feet of the north 10 feet of Lot 37 in said
Block 6.
DESCRIPTION NO. 2
That portion of ▇▇▇▇ ▇▇, ▇▇, ▇▇ ▇▇▇ ▇▇ ▇▇ ▇▇▇▇▇ 6 of Riverside Addition to the
City of Rapid City, ▇▇▇▇▇▇▇▇▇▇ County, South Dakota, lying south ofthe Chicago
and North Western Railroad right-of-way.