EXHIBIT 4.9
LEASEHOLD MORTGAGE
Dated as of November 28, 2003
between
GOLFSMITH NU, L.L.C., a Delaware limited liability company,
as Mortgagor
and
U.S. BANK TRUST NATIONAL ASSOCIATION,
as Collateral Agent
LOCATION OF SECURED PROPERTY
Suffolk County, New York
Section 221.00
Block 01.00
Lot 42.003
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After recording, please return to:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
King & Spalding LLP
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This instrument was prepared by the above-named attorney.
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THIS MORTGAGE DOES NOT ENCUMBER REAL PROPERTY PRINCIPALLY IMPROVED BY OR TO BE
IMPROVED BY ONE OR MORE STRUCTURES CONTAINING IN THE AGGREGATE NOT MORE THAN SIX
(6) RESIDENTIAL DWELLING UNITS, EACH HAVING ITS OWN SEPARATE COOKING FACILITIES.
After recording, please return to:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
LEASEHOLD MORTGAGE
(EAST NORTHPORT, NEW YORK LOCATION)
LEASEHOLD MORTGAGE ("Mortgage"), dated as of November 28, 2003, by
GOLFSMITH NU, L.L.C., a Delaware limited liability company (being hereinafter
called the "Mortgagor") to U.S. BANK TRUST NATIONAL ASSOCIATION, as Collateral
Agent (the "Collateral Agent") under the Indenture, dated as of October 15,
2002, by and among Golfsmith International, Inc., U.S. Bank Trust National
Association, as Trustee and the Guarantors, as defined therein (as amended,
restated or otherwise modified from time to time, the "Indenture"), as
collateral agent for the Holders, as defined in the Indenture;
That for and in consideration of the sum of Ten Dollars ($10.00) and
other valuable consideration, the receipt and sufficiency whereof are hereby
acknowledged, and in order to secure the indebtedness and other obligations of
Mortgagor, hereinafter set forth, Mortgagor does hereby MORTGAGE AND WARRANT,
GRANT A SECURITY INTEREST IN, GRANT, BARGAIN, SELL, CONVEY, ASSIGN, TRANSFER,
HYPOTHECATE, DEPOSIT, PLEDGE, SET OVER and CONFIRM unto Collateral Agent and its
successors and assigns the following:
(A) Mortgagor's leasehold interest and estate created by and
arising pursuant to that certain Lease, dated June 26, 2003 between W.W.R.
Associates, LLC, a New York limited liability company, as landlord, and
Mortgagor, as tenant (the "Mortgaged Lease") and which demises to Mortgagor
certain premises more particularly described therein (the "Premises") and
located on a portion of that certain tract or parcel of land more particularly
described in Exhibit "A" attached hereto and incorporated herein by reference
(the "Land"): TOGETHER WITH all of Mortgagor's right, title and interest in and
to the Mortgaged Lease, and all modifications, extensions and renewals and
assignments of the Mortgaged Lease and in and to all rights to renew or extend
the term of the Mortgaged Lease, or to purchase the Premises leased pursuant to
the Mortgaged Lease, and all credits, deposits, options, privileges and rights
of Mortgagor, as tenant, under the Mortgaged Lease;
(B) TOGETHER WITH all of Mortgagor's right, title and interest, to
the extent granted to Mortgagee under the Mortgaged Lease, in and to (1) the
buildings, structures and improvements of every nature whatsoever now or
hereafter situated on the Land and constituting a part of the Premises, and (2)
the fixtures, machinery, appliances, equipment, furniture and personal property
of every nature whatsoever now or hereafter owned by Mortgagor and located in or
on, attached to, and used or intended to be used in connection with or with the
operation of, the Premises, or in connection with any construction being
conducted or which may be
conducted thereon, and all extensions, additions, improvements, betterments,
renewals, substitutions and replacements to all of the foregoing, and all of the
right, title and interest of Mortgagor to the extent provided under the
Mortgaged Lease in and to any such personal property and fixtures (hereinafter
called the "Improvements").
(C) TOGETHER WITH all of Mortgagor's right, title and interest, to
the extent granted to Mortgagee under the Mortgaged Lease, in and to all
easements, rights-of-way, gores of land, streets, ways, alleys, passages, sewer
rights, water courses, water rights and powers, other real property and
interests therein, and all appurtenances whatsoever, in any way belonging,
relating or appertaining to any of the property described in paragraphs (A) and
(B) hereof, or which hereafter shall in any way belong, relate or be appurtenant
thereto.
(D) TOGETHER WITH all of Mortgagor's right, title and interest, to
the extent granted to Mortgagee under the Mortgaged Lease, in and to (i) all of
the estate, right, title and interest of Mortgagor of, in and to all judgments,
insurance proceeds, awards of damages and settlements hereafter made or
resulting from condemnation proceedings or the taking of the Premises or any
part thereof under the power of eminent domain, or for any damage (whether
caused by such taking or otherwise) to the Premises or any part thereof, or to
any rights appurtenant thereto, and all proceeds of any sale or other
disposition of the Premises or any part thereof; and Collateral Agent is,
subject to the provisions of this Mortgage and the Mortgaged Lease, hereby
authorized to collect and receive said awards and proceeds and to give proper
receipts and acquittances therefor, and (if it so elects) to apply the same
toward the payment of indebtedness and other sums secured hereby,
notwithstanding the fact that the amount owing thereon may not then be due and
payable; and (ii) all contract rights, general intangibles, actions and rights
in action, including without limitation all rights to insurance proceeds and
unearned premiums arising from or relating to the Premises; and (iii) all
proceeds, products, replacements, additions, substitutions, renewals and
accessions of and to the Premises.
(E) TOGETHER WITH all rents, income and other benefits to which
Mortgagor may now or hereafter be entitled to receive from the Premises to be
applied against the indebtedness and other sums secured hereby; provided,
however, that permission is hereby given to Mortgagor, so long as no Event of
Default (as defined in Section 2.01) has occurred hereunder and is continuing,
to collect and use such rents, income and other benefits as they become due and
payable, but not more than one (1) month in advance thereof. Upon the occurrence
of any such Event of Default, the permission hereby given to Mortgagor to
collect such rents, income and other benefits from the Premises shall terminate
and such permission shall be reinstated upon a cure of such Event of Default.
The foregoing provisions hereof shall constitute an absolute and
present assignment of the rents, income and other benefits from the Premises,
subject, however, to the conditional permission given to Mortgagor to collect
and use such rents, income and other benefits as herein above provided; and the
existence or exercise of such right of Mortgagor shall not operate to
subordinate this assignment to any subsequent assignment, in whole or in part,
by Mortgagor, and any such subsequent assignment by Mortgagor shall be subject
to the rights of Collateral Agent and Holders hereunder.
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(F) TOGETHER WITH all right, title and interest of Mortgagor in
and to any and all subleases now or hereafter on or affecting the Premises, and
all books and records which contain payments made under the subleases and all
security therefor.
(G) TOGETHER WITH (i) Mortgagor's rights further to encumber the
Premises; and (ii) all of Mortgagor's rights to enter into any sublease or
sublease agreement.
All of the property described in paragraphs (A), (B), (C), (D), (E),
(F) and (G) above, and each item of property therein described, is hereinafter
referred to collectively as the "Property."
TO HAVE AND TO HOLD the Property and all parts thereof unto Collateral
Agent, its successors and assigns, forever upon the trust, terms and conditions
contained herein.
Grantor is a wholly owned subsidiary of Golfsmith International, Inc.
(the "Borrower") and hereby acknowledges that it will derive substantial
economic benefit from the proceeds of Borrower's issuance of its "Notes" (as
defined below) in the aggregate principal amount of $93,750,000.00 and, as a
result, Grantor has agreed to guarantee Borrower's payment and performance of
its indebtedness, obligations and liabilities under the Notes, the Indenture and
the Indenture Documents.
The Guarantees have been executed and delivered by Guarantors with
respect to Borrower's liability with respect to the Notes, the Indenture and the
Indenture Documents, and Grantor hereby acknowledges that it will derive a
substantial economic benefit from the execution and delivery of the Guarantees
by Guarantors due to the fact that each Guarantor is also a subsidiary of
Borrower and Borrower and Grantor will benefit from the Guarantees. As a result,
Grantor has agreed to grant this Mortgage to secure the payment and performance
by Grantor under its guaranty (and constituting one of the Guarantees) dated
October 15, 2002 (the "Golfsmith NU, LLC Guaranty") and the Obligations of the
other Guarantors under the Guarantees.
This Mortgage is executed and delivered by Mortgagor to secure the
following described obligations, liabilities and indebtedness to Collateral
Agent and Holders (hereinafter collectively referred as the "Obligations"):
(a) All loans, advances, indebtedness, obligations and liabilities
now or from time to time hereafter owing by Golfsmith International, Inc., a
Delaware corporation (the "Borrower"), including the "Obligations" as defined in
the Indenture, to Collateral Agent, Holders, and any other Person under the
Indenture, or under any agreement, instrument or document executed or delivered
to Collateral Agent or Holders in respect of the Indenture (all such agreements,
instruments or documents, collectively, the "Indenture Documents") or the
transactions contemplated thereby, pursuant to which Holders have duly
authorized the creation of an issue of 8.375% Senior Notes due 2009 (the
"Initial Notes"), and Series B 8.375% Exchange Notes due 2009 (the "Exchange
Notes," and together with the Initial Notes and any Additional Notes, as defined
in the Indenture, collectively, the "Notes") as described in the Indenture.
(b) All indebtedness, obligations and liabilities of Grantor and
the other Guarantors arising under the Guarantees (as defined in the Indenture)
), including the indebtedness, obligations and liabilities of Grantor under the
Golfsmith NU, LLC Guaranty;
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(c) All indebtedness, obligations and liabilities of Mortgagor
arising under this Mortgage;
(d) All advances made by Collateral Agent and the other Holders to
protect or preserve the Property or the lien hereof on the Property, or for
taxes, assessments, insurance premiums, or other advances authorized under the
terms of this Mortgage (whether or not Mortgagor remains the owner of the
Property at the time of such advance);
(e) Any and all renewals, extensions, modifications,
substitutions, replacements or consolidations of the indebtedness, liabilities
and obligations described in paragraphs (a), (b), (c) or (d) above, and
(f) All other obligations, liabilities and indebtedness of every
kind and character now or hereafter owing by Borrower, Mortgagor or any
Guarantor to Collateral Agent and/or Holders, however created, incurred or
evidenced, direct or indirect, absolute or contingent, and whether owing under
the Indenture, Indenture Documents, this Mortgage or the Notes, including
without limitation, all "Obligations" (as defined in the Indenture) of Borrower,
Mortgagor and Guarantors to Collateral Agent and Holders.
Maximum Principal Amount Secured. Notwithstanding anything to the
contrary contained in this Mortgage, the maximum aggregate principal amount of
indebtedness that is, or under any contingency may be, secured by this Mortgage
(including Mortgagor's obligation to reimburse advances made by Collateral
Agent), either at execution or at any time thereafter, is $1,210,320, plus
interest thereon and any amounts that Collateral Agent expends upon and
following the occurrence of any Event of Default to the extent that any such
amounts shall constitute payment of (i) taxes and assessments that may be
imposed by law upon any of the Property; (ii) premiums on insurance policies
covering any Property; (iii) expenses incurred in upholding the lien of this
Mortgage, including the expenses of any litigation to prosecute or defend the
rights and lien created by this Mortgage; or (iv) any amount, cost or change to
which Collateral Agent becomes subrogated, upon payment, whether under
recognized principles of law or equity, or under express statutory authority;
then, and in each such event, such amounts or costs shall be added to the
indebtedness secured hereby and shall be secured by this Mortgage.
ARTICLE ONE COVENANTS OF MORTGAGOR
Mortgagor covenants and agrees with Collateral Agent and Holders, or
any successor in title as holder of the Obligations secured hereby, as follows:
1.01 General Representations, Covenants and Warranties. Mortgagor
represents, warrants and covenants that (a) Mortgagor is seized of a good and
valid leasehold estate in and to the Premises, and has good right, full power
and lawful authority to encumber the same as provided herein and Collateral
Agent may, subject to the provisions of the Mortgaged Lease, at all times
peaceably and quietly enter upon, hold, occupy and enjoy the Premises in
accordance with the terms hereof; (b) the Property is free and clear of all
liens, security interests, charges and
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encumbrances whatsoever except to the extent permitted by clauses (1), (2), (3),
(4), (5), (8), (15) and (16) of the definition of Permitted Liens, as defined in
the Indenture, and except for any liens, security interests, charges and
encumbrances created or arising by, through or under the landlord under the
Mortgaged Lease or its predecessors-in-title, (c) Mortgagor will maintain and
preserve the lien of this Mortgage until the Obligations secured hereby have
been paid in full; (d) the Premises has frontage on, and direct access of
ingress, egress, and regress to, public rights of way; and (e) electric, gas,
sewer, water facilities and any other necessary utilities are, and at all times
hereafter shall be, available in sufficient capacity to service the Premises
satisfactorily for its current use, and any easements necessary to the
furnishing of such utility service to Mortgagor have been obtained.
1.02 Compliance with Laws. To the extent Mortgagor is required to
do so under the Mortgaged Lease, Mortgagor covenants and warrants that the
Premises presently complies in all material respects with and will continue to
comply in all material respects with all applicable restrictive covenants,
applicable zoning and subdivision ordinances and building codes, all applicable
health and environmental laws and regulations and other applicable laws, rules
and regulations which affect the Premises and the operations of Mortgagor on the
Premises. If Mortgagor receives notice from any federal, state or other
governmental body that it is not in compliance with any such covenant,
ordinance, code, law or regulation, Mortgagor will provide Collateral Agent with
a copy of such notice and comply or cause the landlord under the Mortgaged Lease
to comply with the provisions of such notice promptly if failure to comply could
reasonably be expected to result in a material adverse effect on the Premises or
the use, operation or value thereof, or on Mortgagor.
1.03 Taxes and Other Charges.
(a) Taxes and Assessments. To the extent required under Section
4.04 of the Indenture or under the Mortgaged Lease, Mortgagor shall pay promptly
when due all taxes, assessments, rates, dues, charges, fees, levies, fines,
impositions, liabilities, obligations and encumbrances of every kind whatsoever
now or hereafter imposed, levied or assessed upon or against the Premises or any
part thereof, or upon or against this Mortgage or the Obligations secured
hereby, or upon or against the security interest of Collateral Agent in the
Premises, as well as all income taxes, assessments and other governmental
charges levied and imposed by the United States of America or any state, county,
municipality or other taxing authority upon or against Mortgagor or in respect
of the Premises or any part thereof.
(b) Mechanic's and Other Liens. Except to the extent permitted by
clause (2) of the definition of Permitted Liens, as defined in the Indenture,
Mortgagor shall not permit or suffer any mechanic's, laborer's, materialman's,
statutory or other lien (other than any lien for taxes not yet due) to be
created upon or filed against the Property.
(c) Taxes Affecting Holders' Interest. Mortgagor will promptly pay
all income, franchise and other taxes owing by Mortgagor and any stamp,
documentary, recordation and transfer taxes or other taxes (unless such payment
by Mortgagor is prohibited by law) which may be required to be paid with respect
to this Mortgage or any instrument evidencing or securing any of the
Obligations. In the event of the enactment after this date of any law of any
governmental entity applicable to Collateral Agent, the Obligations, the
Property or this
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Mortgage imposing upon Collateral Agent the payment of the whole or any part of
the taxes or assessments or charges or liens herein required to be paid by
Mortgagor, or changing in any way the laws relating to the taxation of deeds of
trust or mortgages or security agreements or debts secured by deeds of trust or
mortgages or security agreements or the interest of the mortgagee or secured
party in the property covered thereby, or the manner of collection of such
taxes, so as to affect this Mortgage or the Obligations or Collateral Agent,
then, and in any such event, Mortgagor, upon demand by Collateral Agent, shall
pay such taxes, assessments, charges or liens, or reimburse Collateral Agent
therefor.
(d) Tax Escrow. In order to secure the performance and discharge
of Mortgagor's obligations under this Section 1.03, but not in lieu of such
obligations, and to the extent Mortgagor is not required to pay such sums to the
landlord under the Mortgaged Lease, Mortgagor, upon Collateral Agent's request
after the occurrence of and during the continuance of an Event of Default, will
pay over to Collateral Agent an amount equal to one-twelfth (1/12th) of the next
maturing annual ad valorem taxes, assessments and charges (which taxes,
assessments and charges, for purposes of this paragraph, shall include without
limitation water and sewer rents, and shall hereinafter be collectively called
"Taxes") of the nature described in Section 1.03(a) for each month that has
elapsed since the last date to which the Taxes were paid; and Mortgagor will, in
addition, upon Collateral Agent's request, pay over to Collateral Agent together
with each installment of the Obligations sufficient funds (as estimated from
time to time by Collateral Agent in its sole discretion) to permit Collateral
Agent to pay when due the Taxes. Upon Collateral Agent's request, Mortgagor
shall also deliver to Collateral Agent such additional monies as are required to
make up any deficiencies in the amounts necessary to enable Collateral Agent to
pay the Taxes. In such case, Collateral Agent must timely pay the Taxes or
return the additional monies to Mortgagor to allow Mortgagor to pay such Taxes.
Such deposits shall not be, nor be deemed to be, trust funds but may be
commingled with the general funds of Collateral Agent, and no interest shall be
payable in respect thereof. Upon the occurrence of an Event of Default,
Collateral Agent may apply to the reduction of the Obligations secured hereby,
in such manner as Collateral Agent shall determine, any amount under this
Section 1.03(d) remaining to Mortgagor's credit.
(e) No Credit Against the Obligations Secured Hereby. Neither
Borrower nor Mortgagor shall claim, demand or be entitled to receive any credit,
against the principal or interest payable on the Obligations for so much of the
Taxes assessed against the Property of any part thereof or that are applicable
to the Obligations secured hereby or to Collateral Agent's interest in the
Property. No deduction shall be claimed from the taxable value of the Property
or any part thereof by reason of the Obligations, this Mortgage or any other
instrument securing the Obligations.
1.04 Insurance.
(a) Mortgagor shall, at its sole expense, keep the Premises
insured in such amounts and against such risks and damages as is required under
Section 4.05 of the Indenture. All policies of insurance shall contain an
endorsement, in form and substance reasonably acceptable to Collateral Agent,
showing loss payable to Collateral Agent as its interests appear. Such
endorsement, or an independent instrument delivered to Collateral Agent, shall
provide that the insurance companies will give Collateral Agent at least fifteen
(15) days prior written notice
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before any such policy or policies of insurance shall be altered in any way that
may affect Collateral Agent's rights thereunder or cancelled and that no act of
default of Mortgagor or any other person shall affect the right of Collateral
Agent to recover under such policy or policies or insurance in case of loss or
damage (10 days in the case of cancellation for non-payment of premium).
(b) In order to secure the performance and discharge of
Mortgagor's obligations under this Section 1.04(b), but not in lieu of such
obligations, and to the extent Mortgagor is not required to pay such sums to the
landlord under the Mortgaged Lease, Mortgagor, upon Collateral Agent's request
after the occurrence of and during the continuance of an Event of Default, will
pay over to Collateral Agent an amount equal to one-twelfth (1/12th) of the next
maturing annual insurance premiums for each month that has elapsed since the
last date to which such premiums were paid; and Mortgagor will, in addition,
upon Collateral Agent's request, pay over to Collateral Agent together with each
installment on the Obligations sufficient funds (as estimated from time to time
by Collateral Agent in its sole discretion) to permit Collateral Agent to pay
said premiums when due. Such deposits shall not be, nor be deemed to be, trust
funds but may be commingled with the general funds of Collateral Agent, and no
interest shall be payable in respect thereof. Upon Collateral Agent's request,
Mortgagor shall also deliver to Collateral Agent such additional monies as are
necessary to make up any deficiencies in the amounts necessary to enable
Collateral Agent to pay such premiums when due. In such case, Collateral Agent
must timely pay the premiums or return the additional monies to Mortgagor to
allow Mortgagor to pay the premiums.
(c) Pursuant to its rights granted hereunder in all proceeds from
any insurance policies, Collateral Agent is hereby authorized and empowered at
its option to adjust or compromise any loss under any insurance policies on the
Premises and to collect and receive the proceeds from any such policy or
policies. Each insurance company is hereby authorized and directed to make
payment for all such losses directly to Collateral Agent alone and not to
Mortgagor and Collateral Agent jointly. After deducting from such insurance
proceeds any expenses incurred by Collateral Agent and the other Holders in the
collection or handling of such funds, the net proceeds received by Collateral
Agent shall apply such amounts as requested by Mortgagor for the restoration. In
no event, however, shall any advance be made which will result in the funds
remaining with Collateral Agent being less than the cost of completion of
restoration of the Premises as estimated by an architect or engineer reasonably
satisfactory to Collateral Agent. If, upon completion of restoration of the
Premises there remain funds with Collateral Agent, Collateral Agent shall pay
the remaining funds. Any funds applied against the Obligations secured hereby
shall be applied to particular Obligations, whether then matured or to mature in
the future, in accordance with the terms of the Indenture. Although Collateral
Agent intends to use its best efforts to collect such payments in a timely
fashion, Collateral Agent shall not be responsible for any failure to collect
any insurance proceeds due under the terms of any policy regardless of the cause
of such failure. The provisions of this Section 1.04 are subject to any
provisions of the Mortgaged Lease pertaining to the maintenance, collection, use
and application of insurance proceeds.
(d) Non-Impairment of Collateral Agent's Rights. Nothing contained
in either of Sections 1.03(d) and 1.04(b) shall be deemed to affect any right or
remedy of Collateral Agent under any provision of this Mortgage or of any
statute or rule of law to pay any amount required
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to be paid by Sections 1.03(d) and 1.04(b) and to add the amount so paid to the
Obligations hereby secured. Although Collateral Agent intends to use its best
efforts to make such payments in a timely fashion, the arrangements provided in
Sections 1.03(d) and 1.04(b) are solely for the added protection of Collateral
Agent and the other Holders and entail no responsibility on Collateral Agent's
or Holders' part beyond the allowing of due credit, without interest, for sums
actually received by it. Upon assignment of this Mortgage, any funds on hand
shall be turned over to the assignee and any responsibility of Collateral Agent
with respect thereto shall terminate.
1.05 Condemnation. Collateral Agent shall be entitled to all
compensation, awards, damages, claims, rights of action and proceeds of, or on
account of, any damage or taking through condemnation and is hereby authorized,
at its option, to commence, appear in and prosecute in its own or Mortgagor's
name any action or proceeding relating to any condemnation and to settle or
compromise any claim in connection therewith. All such compensation, awards,
damages, claims, rights of action and proceeds, and any other payments or
relief, and the right thereto, are included in the Property and Collateral Agent
and the other Holders, after deducting therefrom all of their expenses including
reasonable attorneys' fees incurred in the collection or handling of such funds,
shall apply such amounts as requested by Mortgagor for the restoration of the
Premises. In no event, however, shall any advance be made which will result in
the funds remaining with Collateral Agent being less than the cost of completion
of restoration of the Premises as estimated by an architect or engineer
reasonably satisfactory to Collateral Agent. If, upon completion of restoration
of the Premises there remain funds with Collateral Agent, Collateral Agent shall
pay the remaining funds to Mortgagor. Mortgagor agrees to execute such further
assignments of any compensation, awards, damages, claims, rights of action and
proceeds as Collateral Agent may reasonably require. Notwithstanding any such
condemnation, Borrower shall continue to pay interest, computed at the rate
provided in the Notes, on the entire unpaid principal amount thereof. The
provisions of this Section 1.05 are subject to any provisions of the Mortgaged
Lease pertaining to the collection, use and application of any compensation,
awards, damages, claims, rights of action and proceeds insurance proceeds.
1.06 Care of Property.
(a) Mortgagor shall preserve and maintain the Property in good
condition and repair, ordinary wear and tear excepted. Mortgagor shall not
permit, commit or suffer any material waste, impairment or deterioration of the
Property or of any part thereof, and will not take any action which will
materially increase the risk of fire or other hazard to the Property or to any
part thereof.
(b) Mortgagor will not, without the prior written consent of
Collateral Agent, (i) remove from the Premises any fixtures or personal property
covered by this Mortgage which materially impairs the value of the Property or
(ii) make any structural alteration to the Premises or any other alteration
thereto which materially impairs the value thereof.
(c) Collateral Agent may enter upon and inspect the Premises at
any reasonable time during the life of this Mortgage and upon reasonable prior
notice.
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1.07 Further Assurances. At any time and from time to time, upon
Collateral Agent's reasonable request, Mortgagor shall make, execute and
deliver, or cause to be made, executed and delivered, to Collateral Agent and
where appropriate shall cause to be recorded or filed, and from time to time
thereafter to be re-recorded and refiled at such time and in such offices and
places as shall be deemed desirable by Collateral Agent, any and all such
further deeds of trust, instruments or further assurance, certificates and other
documents as Collateral Agent may consider necessary or desirable in order to
effectuate, complete, or perfect, or to continue and preserve the respective
obligations of Borrower and Mortgagor under the Notes, the Indenture Documents
and this Mortgage, and the lien of this Mortgage as a lien upon all of the
Property, whether now owned or hereafter acquired by Mortgagor. Upon any failure
by Mortgagor to do so, Collateral Agent may make, execute, record, file,
re-record or refile any and all such deeds of trust, instruments, certificates
and documents for and in the name of Mortgagor, and Mortgagor hereby irrevocably
appoints Collateral Agent as the agent and attorney-in-fact of Mortgagor to do
so.
1.08 Security Agreements and Financing Statements.
(a) Mortgagor (as debtor) hereby grants to Collateral Agent and
Holders (as creditor and secured party) a security interest in all fixtures,
machinery, appliances, equipment, furniture and personal property of every
nature whatsoever constituting part of the Property.
(b) Mortgagor shall execute any and all such documents, including
without limitation, financing statements pursuant to the applicable Uniform
Commercial Code, as Collateral Agent may reasonably request, to preserve and
maintain the priority of the lien created hereby on property which may be deemed
personal property or fixtures, and shall pay to Collateral Agent on demand any
expenses incurred by Collateral Agent and Holders in connection with the
preparation, execution and filing of any such documents. This Mortgage shall
also constitute a "fixture filing" for purposes of the applicable Uniform
Commercial Code. Mortgagor hereby authorizes and empowers Collateral Agent to
execute and file, on Mortgagor's behalf, all financing statements and refilings
and continuations thereof as Collateral Agent reasonably deems necessary or
advisable to create, preserve and protect said lien. This Mortgage shall be
deemed a security agreement as defined in said Uniform Commercial Code and the
remedies for any violation of the covenants, terms and conditions of the
agreements herein contained shall be (i) as prescribed herein, (ii) by general
law, or (iii) as to such part of the security which is also reflected in said
financing statement by the specific statutory consequences now or hereafter
enacted and specified in the Uniform Commercial Code, all at Collateral Agent's
sole election.
(c) Mortgagor and Collateral Agent agree that the filing of a
financing statement in the records normally having to do with personal property
shall never be construed as in any way derogating from or impairing the express
declaration and intention of the parties hereto, herein above stated, that
everything used in connection with the production of income from the Property
and/or adapted for use therein and/or which is described or reflected in this
Mortgage is, and at all times and for all purposes and in all proceedings both
legal or equitable, shall be regarded as part of the real estate encumbered by
this Mortgage irrespective of whether (i) any such item is physically attached
to the Improvements, (ii) serial numbers are used for the better identification
of certain equipment items capable of being thus identified in a recital
contained herein or in any list filed with Collateral Agent, or (iii) any such
item is referred to or reflected in
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any such financing statement so filed at any time. Similarly, the mention in any
such financing statement of (1) rights in or to the proceeds of any fire and/or
hazard insurance policy, or (2) any award in eminent domain proceedings for a
taking or for loss of value, or (3) Mortgagor's interest as lessor in any
present or future lease or rights to income growing out of the use and/or
occupancy of the Property, whether pursuant to lease or otherwise, shall never
be construed as in any way altering any of the rights of Collateral Agent as
determined by this instrument or impugning the priority of the lien granted
hereby or by any other recorded document, but such mention in the financing
statement is declared to be for the protection of Holders in the event any court
or judge shall at any time hold with respect to (1), (2) and (3) that notice of
the priority of the interest of Collateral Agent and the other Holders to be
effective against a particular class of persons, including but not limited to
the federal government and any subdivisions or entity of the federal government,
must be filed in the Uniform Commercial Code records.
1.09 Assignment of Rents. The assignment contained in paragraph (E)
of this Mortgage shall be fully operative without any further action on the part
of either party and specifically Collateral Agent shall be entitled, at its
option, upon the occurrence and during the continuance of an Event of Default
hereunder, to all rents, income and other benefits from the Premises whether or
not Collateral Agent or Holders take possession of such property. Mortgagor
hereby further grants to Collateral Agent the right after the occurrence and
during the continuance of an Event of Default (i) to enter upon and take
possession of the Premises for the purpose of collecting the said rents, income
and other benefits, (ii) to dispossess by the usual summary ejectment
proceedings any tenant, (iii) to let the Premises or any part thereof, and (iv)
to apply said rents, income and other benefits, after payment of all necessary
charges and expenses, on account of the Obligations secured hereby. Such
assignment and grant shall continue in effect until the Obligations secured
hereby are paid, the execution of this Mortgage constituting and evidencing the
irrevocable consent of Mortgagor to the entry upon and taking possession of the
Premises by Collateral Agent pursuant to such grant, whether or not foreclosure
has been instituted. Neither the exercise of any rights under this paragraph by
Collateral Agent nor the application of any such rents, income or other benefits
to the Obligations secured hereby, shall cure or waive any default or notice of
default hereunder or invalidate any act done pursuant hereto or to any such
notice, but shall be cumulative of all other rights and remedies. Neither this
assignment nor the receipt of rents, income and other benefits by Collateral
Agent shall effect a pro tanto payment of the indebtedness evidenced by or
arising under the obligations, and such rents shall be applied as provided in
Section 3.10 hereof.
1.10 After-Acquired Property. To the extent permitted by and
subject to applicable law, the lien of this Mortgage will automatically attach,
without further act, to all after-acquired property located in or on, or
attached to the Property or any part thereof.
1.11 Subleases Affecting Encumbered Property. Mortgagor represents
that Mortgagor has delivered to Collateral Agent true, correct and complete
copies of all subleases of any portion of the Premises, that all such subleases
are presently in effect and that no default by Mortgagor exists in such
subleases. As any such sublease shall expire or terminate or as any new sublease
shall be made, Mortgagor shall so notify Collateral Agent in order that at all
times Collateral Agent shall have a current list of all subleases affecting the
Premises. The assignment contained in paragraph (F) of this Mortgage shall not
be deemed to impose upon Collateral Agent any of the obligations or duties of
Mortgagor provided in any such sublease (including, without
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limitation, any liability under the covenant of quiet enjoyment contained in any
sublease in the event that any tenant shall have been joined as a party
defendant in any action to foreclose this Mortgage and shall have been barred
and foreclosed thereby of all right, title and interest and equity of redemption
in the Property or any part thereof), and Mortgagor shall comply with and
observe its obligations in all material respects as landlord under all subleases
affecting the Property or any part thereof. Mortgagor, if required by Collateral
Agent, shall furnish promptly to Collateral Agent original or certified copies
of all such subleases now existing or hereafter created. Mortgagor shall not,
without the express prior written consent of Collateral Agent, enter into any
sublease affecting the Property, or amend, modify, extend, terminate or cancel,
accept the surrender of, subordinate, accelerate the payment of rent as to, or
change the terms of any renewal option of any such sublease now existing or
hereafter created, or permit or suffer an assignment or sublease. Mortgagor
shall not accept payment of rent more than one (1) month in advance without the
prior written consent of Collateral Agent.
With respect to the assignment contained in paragraph (F) of this
Mortgage, Mortgagor shall, from time to time upon request of Collateral Agent,
specifically assign to Collateral Agent as additional security hereunder, by an
instrument in writing in such form as may be approved by Collateral Agent in its
reasonable discretion, all right, title and interest of Mortgagor in and to any
and all subleases now or hereafter on or affecting the Property, together with
all security therefor and all monies payable thereunder, subject to the
conditional permission herein above given to Mortgagor to collect the rentals
under any such sublease. Mortgagor shall also execute and deliver to Collateral
Agent any notification, financing statement or other document reasonably
required by Collateral Agent to perfect the foregoing assignment as to any such
sublease. The provisions of this Section 1.12 shall be subject to the provisions
of paragraph (E).
1.12 Collateral Agent's Performance of Defaults. If Mortgagor
defaults in the payment of any tax, assessment, encumbrance or other imposition,
in its obligation to furnish insurance hereunder, or in the performance or
observance of any other covenant, condition or term in this Mortgage, the
Indenture Documents or the Notes, Collateral Agent may, to preserve its interest
in the Property, perform or observe the same, and all payments made (whether
such payments are regular or accelerated payments) and costs and expenses
incurred or paid by Collateral Agent in connection therewith shall become due
and payable immediately. The amounts so incurred or paid by Collateral Agent
together with interest thereon at the rate per annum specified in Section 2.13
of the Indenture from the date incurred until paid by Mortgagor, shall be added
to the Obligations and secured by the lien of this Mortgage. Collateral Agent is
hereby empowered to enter and authorize others to enter upon the Premises or any
part thereof for the purposes of performing or observing any such defaulted
covenant, condition or term, without thereby becoming liable to Mortgagor or any
person in possession holding under Mortgagor.
1.13 Use of Property. Mortgagor covenants that the Property will be
used for the purposes set forth in the Mortgaged Lease.
1.14 Required Notices. Mortgagor shall notify Collateral Agent
promptly of the occurrence of any of the following: (i) receipt of any material
notice from any governmental authority relating to the Property; (ii) receipt of
any material notice from any tenant leasing all or any portion of the Premises;
(iii) any material change in the occupancy of the Premises; (iv) receipt of any
material notice from the holder of any lien or security interest in the
Property; or
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(v) commencement of any judicial or administrative proceedings by or against or
otherwise affecting the Property.
1.15 Covenants Regarding Mortgaged Lease.
(a) Mortgagor hereby warrants and represents as follows: (i) the
Mortgaged Lease is in full force and effect, and, except as disclosed in writing
to Collateral Agent, unmodified by any writing or otherwise; (ii) all rent and
other charges and impositions reserved therein have been paid to the extent they
are payable to the date hereof; (iii) Mortgagor enjoys the quiet and peaceful
possession of the Premises demised thereby; (iv) Mortgagor is not in default
under any of the terms thereof, there are no circumstances which, with the
passage of time or the giving of notice or both, would constitute an event of
default thereunder; and (v) the landlord under the Mortgaged Lease is not in
default under any of the terms or provisions thereof on the part of the landlord
to be observed or performed.
(b) Further, with respect to the Mortgaged Lease, Mortgagor
covenants and agrees as follows: (i) to promptly and faithfully observe, perform
and comply with all of the material terms, covenants and provisions thereof on
its part to be observed, performed and complied with, at all times set forth
therein; (ii) not to do, permit, suffer or refrain from doing anything, as a
result of which, there would be a default under or a breach of any of the terms
thereof; (iii) not to cancel, surrender, modify, amend or in any way alter or
permit the alteration of any of the material terms of the Mortgaged Lease; (iv)
to give Collateral Agent immediate notice of any default by anyone thereunder
and to promptly deliver to Collateral Agent a copy of each notice of default
received or delivered by Mortgagor in connection therewith; (v) to furnish to
Collateral Agent copies of such information and evidence as Collateral Agent may
reasonably require concerning Mortgagor's due observance, performance and
compliance with the terms, covenants and provisions thereof; and (vi) that any
default of Mortgagor under the Mortgaged Lease shall constitute an additional
Event of Default under this Mortgage.
(c) In the event of any default by Mortgagor in the performance of
any of its obligations under the Mortgaged Lease, including, without limitation,
any default in the payment of rent and other charges and impositions made
payable by the lessee thereunder, then, in each and every case, Collateral Agent
may, at its option and without notice, cause the default or defaults to be
remedied and otherwise exercise any and all of the rights of Mortgagor therein
in the name of and on behalf of Mortgagor. Mortgagor shall, on demand, reimburse
Collateral Agent, as applicable, for all advances made and expenses incurred by
Collateral Agent in curing any such default (including, without limitation,
reasonable attorneys' fees).
(e) It is hereby agreed that the fee title and the leasehold
estate in the property demised by the Mortgaged Lease shall not merge but shall
always be kept separate and distinct, notwithstanding the union of said estates
in Mortgagor or a third party whether by purchase or otherwise. If Mortgagor
acquires the fee title or any other estate, title or interest in the property
demised by the Mortgaged Lease, or any part thereof, the lien of the Mortgage
shall attach to, cover and be a lien upon such acquired estate, title or
interest and the same shall thereupon be and become a part of the Property with
the same force and effect as if specifically encumbered therein. Mortgagor
agrees to execute all instruments and documents which Collateral Agent may
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reasonably require to ratify, confirm and further evidence Collateral Agent's
lien on the acquired estate, title or interest. Furthermore, Mortgagor hereby
appoints Collateral Agent its true and lawful attorney-in-fact to execute and
deliver all such instruments and documents in the name and on behalf of
Mortgagor.
(f) If the Mortgaged Lease is cancelled or terminated, and if
Collateral Agent or a nominee of Collateral Agent shall enter into any new lease
of the property demised thereby, Mortgagor shall have no right, title or
interest in or to the new lease or the leasehold estate created by such new
lease.
(g) Notwithstanding anything to the contrary contained herein,
this Mortgage shall not constitute an assignment of the Mortgaged Lease within
the meaning of any provisions thereof prohibiting their assignment, and
Collateral Agent, as applicable, shall have no liability or obligation
thereunder by reason of its acceptance of this Mortgage. Collateral Agent, as
applicable, shall be liable for the obligations of the lessee arising under the
Mortgaged Lease for only that period of time which Collateral Agent is in
possession of the Property or has acquired, by foreclosure or otherwise, and is
holding all of Mortgagor's right, title and interest therein.
(h) Notwithstanding anything contained herein to the contrary, and
in addition to any rights, privileges and remedies granted to Collateral Agent
elsewhere in this Mortgage, Collateral Agent shall have, and Mortgagor hereby
grants to Collateral Agent, any and all rights, privileges and remedies of
leasehold lenders provided for in the Mortgaged Lease without the necessity of
particularly specifying any or all of such rights, privileges and remedies that
are or could be granted to leasehold Collateral Agents pursuant to the Mortgaged
Lease.
(i) Notwithstanding anything contained herein to the contrary, to
the extent the any of the covenants and obligations of Mortgagor hereunder, or
any of the rights granted to Collateral Agent hereunder, conflict with the
provisions of the Mortgaged Lease, the provisions of the Mortgaged Lease shall
control, and Mortgagor shall not be required to take any action hereunder nor
shall Collateral Agent be entitled to exercise any rights hereunder that are not
permitted under the provisions of the Mortgaged Lease.
1.16 Future Indebtedness of Mortgagor. The lien of this Mortgage
secures, as of the date hereof, without further act, all Obligations to
Collateral Agent and the other Holders, including any and all future loans and
advances made by Collateral Agent and the other Holders pursuant to the
Indenture to or for the benefit of Borrower, Mortgagor or Guarantors from time
to time hereafter.
ARTICLE TWO
DEFAULTS
2.01 Event of Default. The term "Event of Default", wherever used
in this Mortgage, shall mean the occurrence of an "Event of Default" as such
term is defined in Section 6.01 of the Indenture.
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ARTICLE THREE
REMEDIES
3.01 Acceleration of Maturity. If an Event of Default shall have
occurred and be continuing, then all of the Obligations secured hereby shall, at
Collateral Agent's option, immediately become due and payable without notice or
demand, time being of the essence hereof; and no omission on the part of
Collateral Agent to exercise such option when entitled to do so shall be
construed as a waiver of such right, provided that upon an Event of Default
under clauses (7) or (8) of the definition of "Event of Default" in Section 6.01
of the Indenture, all Obligations shall immediately become due and payable.
3.02 Collateral Agent's Power of Enforcement. If an Event of
Default shall have occurred and be continuing, Collateral Agent may, either with
or without entry or taking possession as herein above provided or otherwise, and
without regard to whether or not the Obligations shall be due and without
prejudice to the right of Collateral Agent or Holders thereafter to bring an
action of foreclosure or any other action for any default existing at the time
such earlier action was commenced, proceed by any appropriate action or
proceeding: (a) to enforce payment of the Obligations or the performance of any
term hereof or any other right; (b) to foreclose this Mortgage and to sell, as
an entirety or in separate lots or parcels, the Property under the power of sale
hereinafter provided or the judgment or decree of a court or courts of competent
jurisdiction; and (c) to pursue any other remedy available to it. Collateral
Agent shall take action either by such proceedings or by the exercise of its
power with respect to entry or taking possession, or both, as Collateral Agent
may determine.
3.03 Collateral Agent's Right to Enter and Take Possession. Operate
and Apply Income.
(a) If an Event of Default shall have occurred and be continuing,
(i) Mortgagor upon demand of Collateral Agent shall forthwith surrender to
Collateral Agent the actual possession and if and to the extent permitted by
law, Collateral Agent itself, or by such officers or agents as it may appoint,
may enter upon and take possession of the Property and may exclude Mortgagor and
its agents and employees wholly therefrom and may have joint access with
Mortgagor to the books, papers and accounts of Mortgagor; and (ii) Mortgagor
will pay monthly in advance to Collateral Agent on Collateral Agent's entry into
possession, or to any receiver appointed to collect the rents, income and other
benefits of the Property, the fair and reasonable rental value for the use and
occupation of such part of the Property as may be in possession of Mortgagor,
and upon default in any such payment will vacate and surrender possession of
such part of the Property to Collateral Agent or to such receiver and, in
default thereof, Mortgagor may be evicted by summary proceedings or otherwise.
(b) If Mortgagor shall for any reason fail to surrender or deliver
the Property or any part thereof after Collateral Agent's demand, Collateral
Agent may obtain a judgment or decree, on behalf of all of the Holders,
conferring on Collateral Agent the right to immediate possession or requiring
Mortgagor to deliver immediate possession of all or part of the Property to
Collateral Agent, to the entry of which judgment or decree Mortgagor hereby
specifically consents. Mortgagor shall pay to Collateral Agent, upon demand, all
reasonable costs and
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expenses of obtaining such judgment or decree and compensation to Collateral
Agent and the other Holders, its attorneys and agents, and all such costs,
expenses and compensation shall, until paid, be secured by the lien of this
Mortgage.
(c) Upon every such entering upon or taking of possession of the
Property under this Section 3.03, Collateral Agent may hold, store, use,
operate, manage and control the Property and conduct the business thereof, and,
from time to time:
(i) Make all necessary and proper maintenance, repairs,
renewals, replacements, additions, betterments and improvements thereto
and thereon and purchase or otherwise acquire additional fixtures,
personalty and other property;
(ii) Insure or keep the Property insured;
(iii) Manage and operate the Property and exercise all the
rights and powers of Mortgagor in its name or otherwise with respect to
the same;
(iv) Enter into agreements with others to exercise the
powers herein granted Collateral Agent, all as Collateral Agent from
time to time may determine; and Collateral Agent may collect and
receive all the rents, income and other benefits thereof, including
those past due as well as those accruing thereafter; and shall apply
the monies so received by Collateral Agent in such priority as
Collateral Agent may determine to (1) the payment of the Obligations;
(2) the deposits for taxes and assessments and insurance premiums due;
(3) the cost of insurance, taxes, assessments and proper charges upon
the Property or any part thereof; (4) the expenses of operating,
maintaining, repairing and improving the Property, including with
limitation renting commissions and rental collection commissions paid
to Collateral Agent or agent on behalf of Collateral Agent and the
other Holders or of the receiver; and (5) the reasonable compensation,
expenses and disbursements of the agents, attorneys and other
representatives of Collateral Agent. All costs, expenses and
liabilities of every character incurred by Collateral Agent in
managing, operating and maintaining the Property shall constitute
additional Obligations secured hereby. While in possession of the
Property, Collateral Agent or the receiver shall be liable to account
only for the rents, issues and profits actually received.
Collateral Agent shall surrender possession of the Property to Mortgagor only
when all Obligations secured hereby and all amounts under any of the terms of
this Mortgage shall have been paid and all defaults cured or waived. The same
right of taking possession, however, shall exist if any subsequent Event of
Default shall occur and be continuing.
3.04 Foreclosure. If a Default shall have occurred and be
continuing, Collateral Agent shall be entitled to proceed to foreclose this
Mortgage in the manner provided by law for the foreclosure of mortgages, and to
cause the sale of all or any portion of the Property for cash or upon such terms
and conditions as Collateral Agent may deem expedient, under the judgment or
decree of a court or courts of competent jurisdiction in order to pay the
Indebtedness secured hereby and accrued interest thereon and insurance premiums,
liens, assessments, taxes and charges, including utility charges, if any, with
accrued interest therein, and all expenses of sale and of all proceedings in
connection therewith, including reasonable attorneys' fees. In the event
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of any such foreclosure sale, Mortgagor shall be deemed a tenant holding over
and shall forthwith deliver possession to the purchaser or purchasers at such
sale or be summarily dispossessed according to provisions of law applicable to
tenants holding over. If a Default shall have occurred and be continuing, to the
extent permitted under applicable law, Collateral Agent shall be entitled, and
is hereby granted the power, to foreclose this Mortgage by non-judicial means.
If Collateral Agent elects to foreclose this Mortgage by such means, Collateral
Agent shall be authorized, at its option, whether or not possession of the
Property is taken, after giving notice by publication once a week for three (3)
consecutive weeks of the time, place and terms of each such sale, together with
a description of the Property, by publication in a newspaper published in the
county or counties wherein the Property or any part thereof is located, to sell
the Property (or such part or parts thereof as Collateral Agent may from time to
time elect to sell) in front of such county's main or front courthouse door, at
public outcry, to the highest bidder for cash. At any foreclosure sale, any part
or all of the Property, real, personal or mixed, may be offered for sale in
parcels or en masse for one total price, the proceeds of any such sale en masse
to be accounted for in one account without distinction between the items
included therein or without assigning to them any proportion of such proceeds,
Mortgagor hereby waiving the application of any doctrine of marshalling or like
proceeding. In case Collateral Agent, in the exercise of the power of sale
herein given, elects to sell all or any portion of the Property in parts or
parcels, sales thereof may be held from time to time, and the power of sale
granted herein shall not be fully exercised until all of the Property not
previously sold shall have been sold or all the Indebtedness and Obligations
shall have been paid in full. In the event of any such foreclosure sale,
Mortgagor shall be deemed a tenant holding over and shall forthwith deliver
possession to the purchaser or purchasers at such sale or be summarily
dispossessed according to provisions of law applicable to tenants holding over.
Collateral Agent may adjourn from time to time any sale by it to be made under
or by virtue of this Mortgage by announcement at the time and place appointed
for such sale or for such adjourned sale or sales; and, except as otherwise
provided by any applicable provision of law, Collateral Agent, without further
notice or publication, may make such sale at the time and place to which the
same shall be so adjourned. Upon any sale made under or by virtue of this
Section 3.04. Collateral Agent may bid for and acquire the Property or any part
thereof and in lieu of paying cash therefor may make settlement for the purchase
price by crediting upon the Obligations the net sales price after deducting
therefrom the expenses of the sale and the costs of the action and any other
sums which Collateral Agent is authorized to deduct under this Mortgage.
3.05 Leases. Collateral Agent is authorized to foreclose this
Mortgage subject to the rights of any tenants of the Property, and the failure
to make any such tenants parties defendant to any such foreclosure proceedings
and to foreclose their rights will not be, nor be asserted by Mortgagor to be, a
defense to any proceedings instituted by Collateral Agent to collect the sums
secured hereby or to collect any deficiency remaining unpaid after the
foreclosure sale of the Property.
3.06 Waiver of Appraisement. Valuation. Stay, Extension and
Redemption Laws. Mortgagor agrees to the full extent permitted by law that in
case of a default in its part hereunder, neither Mortgagor nor anyone claiming
through or under Mortgagor shall or will set up, claim or seek to take advantage
of any appraisement, valuation, extension or redemption laws now or hereafter in
force, in order to prevent or hinder the enforcement or foreclosure of this
Mortgage or the absolute sale of the Property or the final and absolute putting
into possession
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thereof, immediately after such sale, of the purchasers thereat, and Mortgagor,
for itself and all who may at any time claim through or under Mortgagor, hereby
waives, to the full extent that Mortgagor may lawfully so do, the benefit of all
such laws, and any and all right to have the assets comprising the Property
marshaled upon any foreclosure of the lien hereof and agrees that Collateral
Agent or any court having jurisdiction to foreclose such lien may sell the
Property in part or as an entirety.
3.07 Receiver. If an Event of Default shall have occurred and be
continuing, Collateral Agent, to the extent permitted by law and without regard
to the value or adequacy of the security for the Obligations secured hereby,
shall be entitled as a matter of right if it so elects to the appointment of a
receiver to enter upon and take possession of the Property and to collect all
rents, income and other benefits thereof and apply the same as the court may
direct, and any such receiver shall be entitled to hold, store, use, operate,
manage and control the Property and conduct the business thereof as would
Collateral Agent pursuant to Section 3.03(c) above. The expenses, including
receiver's fees, reasonable attorney's fees, costs and agent's compensation,
incurred pursuant to the powers herein contained shall be secured by this
Mortgage. The right to enter and take possession of and to manage and operate
the Property and to collect all rents, income and other benefits thereof,
whether by a receiver or otherwise, shall be cumulative to any other right or
remedy hereunder or afforded by law and may be exercised concurrently therewith
or independently thereof. Collateral Agent shall be liable to account only for
such rents, income and other benefits actually received by Collateral Agent,
whether received pursuant to this paragraph or Section 3.03. Notwithstanding the
appointment of any receiver or other custodian, Collateral Agent shall be
entitled as pledgee to the possession and control of any cash, deposit, or
instruments at the time held by, or payable or deliverable under the terms of
this Mortgage to, Collateral Agent.
3.08 Suits to Protect the Property. Collateral Agent shall have the
power and authority to institute and maintain any suits and proceedings as
Collateral Agent may deem advisable (a) to prevent any impairment of the
Property by any acts which may be unlawful or any violation of this Mortgage,
(b) to preserve or protect its interest in the Property, and (c) to restrain the
enforcement of or compliance with any legislation or other government enactment,
rule or order that may be unconstitutional or otherwise invalid, if the
enforcement or compliance with such enactment, rule or order might impair the
security hereunder or be prejudicial to Collateral Agent's or Holders' interest.
3.09 Proofs of Claim. In the case of any receivership, insolvency,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceedings affecting Mortgagor or any guarantor, co-maker or endorser
of any Mortgagor's obligations, its creditors or its property, Collateral Agent,
to the extent permitted by law, shall be entitled to file such proofs of claim
and other documents as may be necessary or advisable in order to have its claims
allowed in such proceedings for the entire amount due and payable by Borrower,
Mortgagor and Guarantors under this Mortgage, the Indenture, the Indenture
Documents and any other instrument securing the Obligations, at the date of the
institution of such proceedings, and for any additional amounts which may become
due and payable by Borrower, Mortgagor and Guarantors after such date.
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3.10 Application of Monies by Collateral Agent.
(a) Upon the occurrence and during the continuance of an Event of
Default, Collateral Agent shall be entitled to ▇▇▇ for and to recover judgment
against Borrower, Mortgagor and/or Guarantors for the whole amount of the
Obligations due and unpaid together with costs and expenses, including without
limitation, the reasonable compensation, expenses and disbursements of
Collateral Agent's and Holders' agents, attorneys and other representatives,
either before, after or during the pendency of any proceedings for the
enforcement of this Mortgage, and the right of Collateral Agent to recover such
judgment shall not be affected by any taking possession or foreclosure sale
hereunder, or by the exercise of any other right, power or remedy for the
enforcement of the terms of this Mortgage, or the foreclosure of the lien
hereof.
(b) In case of a foreclosure sale of all or any part of the
Property and the application of the proceeds of sale to the payment of the
Obligations secured hereby, Collateral Agent shall be entitled to enforce
payment from Borrower, Mortgagor and/or Guarantors of all Obligations then
remaining due and unpaid and to recover judgment against Borrower, Mortgagor
and/or Guarantors for any portion thereof remaining unpaid, with interest.
(c) Mortgagor hereby agrees, to the extent permitted by law, that
no recovery of any such judgment by Collateral Agent and no attachment or levy
of any execution upon any of the Property or any other property shall in any way
affect the lien of this Mortgage upon the Property or any part thereof or any
lien, rights, powers or remedies of Holders hereunder, but such lien, rights,
powers and remedies shall continue unimpaired as before.
(d) Any monies collected or received by Collateral Agent under
this Section 3.10 shall be applied to the payment of reasonable compensation,
expenses and disbursements of the agents, attorneys, and other representatives
of Collateral Agent, and the balance remaining shall be applied to the payment
of the Obligations secured hereby.
(e) The provisions of this paragraph shall not be deemed to limit
or otherwise modify the provisions of any guaranty of the Obligations of
Guarantor to Collateral Agent.
3.11 Delay or Omission; No Waiver. No delay or omission of
Collateral Agent to exercise any right, power or remedy accruing upon any Event
of Default shall exhaust or impair any such right, power or remedy or shall be
construed to waive any such Event of Default or to constitute acquiescence
therein. Every right, power and remedy given to Collateral Agent may be
exercised from time to time and as often as may be deemed expedient by
Collateral Agent.
3.12 No Waiver of One Default to Affect Another. No waiver of any
Event of Default hereunder shall extend to or affect any subsequent or any other
Event of Default then existing, or impair any rights, powers or remedies
consequent thereon. If Collateral Agent (a) grants forbearance or an extension
of time for the payment of any Obligations secured hereby; (b) takes other or
additional security for the payment thereof; (c) waives or does not exercise any
right granted in the Indenture; (d) releases any part of the Property from the
lien of this Mortgage; (e) consents to the filing of any map, plat or replat of
the Land; (f) consents to the granting of any easement on the Land; or (g) makes
or consents to any agreement changing the terms of this
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Mortgage or subordinating the lien or any charge hereof, no such act or omission
shall release, discharge, modify, change or affect the Obligations of Mortgagor.
No such act or omission shall preclude Collateral Agent or Holders from
exercising any right, power or privilege herein granted or intended to be
granted in case of any Event of Default then existing or of any subsequent Event
of Default nor shall the lien of this Mortgage be affected thereby.
3.13 Discontinuance of Proceedings: Position of Parties Restored.
If Collateral Agent or Holders shall have proceeded to enforce any right or
remedy under this Mortgage by foreclosure, entry or otherwise and such
proceedings shall have been discontinued or abandoned for any reason, or such
proceedings shall have resulted in a final determination adverse to Collateral
Agent or Holders, then and in every such case Mortgagor and Collateral Agent
shall be restored to their former positions and rights hereunder, and all
rights, powers and remedies of Collateral Agent shall continue as if no such
proceedings had occurred or had been taken.
3.14 Remedies Cumulative. No right, power or remedy conferred upon
or reserved to Collateral Agent by this Mortgage or the Notes is exclusive of
any other right, power or remedy, but each and every such right, power and
remedy shall be cumulative and concurrent and shall be in addition to any other
right, power and remedy given under the Notes, or now or hereafter existing at
law, in equity or by statute.
ARTICLE FOUR
TRANSFER OR FURTHER ENCUMBRANCE OF THE PROPERTY
4.01 Transfer of Further Encumbrance of the Property. In the event
of any sale, conveyance, transfer, lease, pledge or further encumbrance of the
Property or any interest in or any part of the Property, or any further
assignment of rents from the Property without the prior written consent of
Collateral Agent then, at Collateral Agent's option, Collateral Agent may
declare all Obligations to be due and payable immediately without demand or
notice. Collateral Agent's consent shall be within its sole and absolute
discretion.
ARTICLE FIVE
MISCELLANEOUS PROVISIONS
5.01 Successors and Assigns Included in Parties. Whenever one of
the parties hereto is named or referred to herein, the heirs, personal
representatives, successors and assigns of such party shall be included and all
covenants and agreements contained in this Mortgage, by or on behalf of
Mortgagor or Collateral Agent shall bind and inure to the benefit of their
respective successors and assigns, whether so expressed or not.
5.02 Addresses for Notices, Etc.
(a) Except as may be otherwise provided herein, any notice,
report, demand or other instrument authorized or required to be given or
furnished under this Mortgage to Mortgagor or Collateral Agent shall be in
writing, shall be sent by personal delivery or sent by registered or certified
mail (postage prepaid, return receipt requested), overnight courier, at the
address set forth below:
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If to Collateral Agent at: U.S. Bank Trust National Association
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇,
Vice President ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to: ▇▇▇▇▇▇ & Whitney LLP
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇, Esq. ▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇)▇▇▇-▇▇▇▇
If to Guarantor, at: Golfsmith International, Inc.
▇▇▇▇▇ ▇▇▇▇▇ ▇▇-▇▇ ▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇ Attn: ▇▇▇▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇ Facsimile No.: (▇▇▇)▇▇▇-▇▇▇▇]
With a copy to: King & Spalding LLP
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇, Esq. ▇▇▇▇
▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇)▇▇▇-▇▇▇▇
(b) Either party may change the address to which any such notice,
report, demand or other instrument is to be delivered or mailed, by furnishing
written notice of such change to the other party, but no such notice of change
shall be effective unless and until received by such other party. All notices,
reports, demands or other instruments authorized or required to be sent in
accordance with this Section 5.02. shall be deemed received on the earlier of
the date of actual receipt or 3 Business Days (as defined in the Indenture)
after the deposit thereof in the mail.
5.03 Headings. The headings of the articles, sections, paragraphs
and subdivisions of this Mortgage are for convenience of reference only, are not
to be considered a part hereof, and shall not limit or expand or otherwise
affect any of the terms hereof.
5.04 Invalid Provisions to Affect No Others. In the event that any
of the covenants, agreements, terms or provisions contained in the Notes shall
be deemed invalid, illegal or unenforceable in any respect, the validity of the
remaining covenants, agreements, terms or provisions contained in the Notes
shall be in no way affected, prejudiced or disturbed thereby; and if any
application of any term, restriction or covenant to any person or circumstances
is deemed illegal or unenforceable, the application of such term, restriction or
covenant to other persons and circumstances shall remain unaffected to the
extent permitted by law.
5.05 Changes. Etc. Neither this Mortgage nor any term hereof may be
changed, waived, discharged or terminated orally, or by any action or inaction,
but only by an instrument in writing signed by Collateral Agent or Mortgagor, as
the case may be, against which enforcement of the change, waiver, discharge or
termination is sought. The modification hereof
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or of any of the Notes or the release of any part of the Property from the lien
hereof shall not impair the priority of the lien of this Mortgage.
5.06 Lien Law Compliance. In compliance with Section 13 and Article
3-A of the Lien Law of the State of New York, Mortgagor will receive all
advances secured by this Mortgage and will hold the right to receive all such
advances as a trust fund to be applied first for the purpose of paying the cost
of improvements, and will apply all such advances first to the payment of the
costs of improvements before using any part of such advances for any other
purpose.
5.07 Satisfaction. Upon the payment to Collateral Agent all of the
Obligations, Mortgagor shall be entitled to receive, at the option and request
of Mortgagor, either a satisfaction of mortgage or an assignment of the Mortgage
in recordable form without recourse, representation or warranty, expressed or
implied, and without payment of any further sums to Collateral Agent, other than
Collateral Agent's reasonable attorneys' fees and disbursements actually
incurred. Mortgagor shall pay all costs of recordation relating to any such
satisfaction or assignment.
5.08 Governing Law. THIS MORTGAGE SHALL BE GOVERNED, CONSTRUED,
APPLIED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
[Remainder of Page Intentionally Left Blank]
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IN WITNESS WHEREOF, Mortgagor has caused this Mortgage to be duly
executed under seal by its duly authorized corporate officers on the day and
year first above written.
GOLFSMITH NU, L.L.C., a Delaware
limited liability company
By: Golfsmith Holdings, L.P., its sole member
By: Golfsmith GP Holdings, Inc.,
its general partner
By: ▇▇▇▇▇ ▇▇▇▇▇▇
----------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Secretary
STATE OF NEW YORK )
) ss.:
COUNTY OF New York )
On the 1st day of December in the year 2003 before me, the undersigned,
a notary public in and for said state, personally appeared ▇▇▇▇▇ ▇▇▇▇▇▇,
Secretary of Golfsmith GP Holdings, Inc., the general partner of Golfsmith
Holdings, L.P., which is the sole member of Golfsmith NU, L.L.C., a Delaware
limited liability company, personally known to me or proved to me on the basis
of satisfactory evidence to be the individual(s) whose name(s) is (are)
subscribed to the within instrument and acknowledged to me that he/she/they
executed the same in his/her/their capacity (ies), and that by his/her/their
signature(s) on the instrument, the individual(s), or the person upon behalf of
which the individual(s) acted, executed the instrument.
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------
Notary Public
Printed Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
My Commission Expires:
September 3, 2006 [STAMP]
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SCHEDULE A
TO
MORTGAGE
Legal Description
[Attached]
ALL that certain plot, piece or parcel of land, situate, lying and
being at East North port, Town of Huntington, County of Suffolk and State of
New York, being more particularly bounded and described as follows:
BEGINNING at a point on the Northerly side of Jericho Turnpike (N.Y.S.
Route 25) distant 70.00 feet Westerly from the extreme Southerly end of a line
which connects the Westerly side of Larkfield Road with the Northerly side of
Jericho Turnpike.
RUNNING THENCE along the Northerly side of Jericho Turnpike the
following 2 courses and distances:
1. South 79 degrees 34 minutes 00 seconds West 140.11 feet;
2. South 76 degrees 35 minutes 21 seconds West, 250.11 feet to
land now or formerly of ▇▇▇▇▇▇▇ Nohjel;
THENCE along said land now or formerly of ▇▇▇▇▇▇▇ Nohjel, North 14
degrees 35 minutes 00 seconds West, 288.58 feel to land now or formerly of MEMCo
Engineering & Manufacturing Co.;
THENCE along said last mentioned land North 78 degrees 08 minutes 30
seconds East, 395.80 feel to land now or formerly of Empire Associates Realty
Co.;
THENCE along said land now or formerly of Empire Associates Really Co.,
South 13 degrees 27 minutes 30 seconds East, 284.99 feet to the Northerly side
of Jericho Turnpike, the point or place of BEGINNING.
Said premises being known as ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇ and being improved with a commercial building.
Said premises being shown on the Suffolk County Land and Tax Map as Section
221.00, Block 01.00, Lots 42.003.