Exhibit 10.95
Loan No. 6518291
MORTGAGE, ASSIGNMENT OF LEASES AND RENTS AND SECURITY
AGREEMENT
(COLLATERAL INCLUDES FIXTURES)
Dated as of ▇▇▇▇▇ ▇, ▇▇▇▇
▇▇▇▇▇▇ WESTERN SPARTANBURG, L.L.C.
(Mortgagor)
TO
▇▇▇▇ ▇▇▇▇▇▇▇ LIFE INSURANCE COMPANY
(Mortgagee)
LOCATION OF PROPERTY:
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
THIS MORTGAGE COVERS GOODS WHICH ARE OR ARE TO BECOME FIXTURES,
IS EFFECTIVE AS A FINANCING STATEMENT FILED AS A FIXTURE FILING
AND IS TO BE FILED IN THE REAL ESTATE RECORDS.
Record and Return To:
▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. Sarasek, Esq.
Loan No. 6518291
TABLE OF CONTENTS
Page
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1. Payment of Indebtedness and Incorporation of Covenants, Conditions and Agreements.........................6
2. Warranty of Title.........................................................................................6
3. Insurance; Casualty.......................................................................................6
4. Payment of Taxes, Etc. ..................................................................................11
5. Reserve Fund.............................................................................................12
6. Condemnation.............................................................................................15
7. Leases and Rents.........................................................................................15
8. Maintenance and Use of Mortgaged Property ...............................................................17
9. Transfer or Encumbrance of the Mortgaged Property or Interests in the Mortgagor; Other Indebtedness......18
10. Estoppel Certificates....................................................................................24
11. No Cooperative or Condominium............................................................................25
12. Changes in the Laws Regarding Taxation ..................................................................25
13. No Credits on Account of the Indebtedness................................................................25
14. Documentary Stamps.......................................................................................25
15. Right of Entry...........................................................................................25
16. Books and Records........................................................................................26
17. Performance of Other Agreements..........................................................................26
18. Representations and Covenants Concerning Loan............................................................26
19. Single Purpose Entity/Separateness.......................................................................29
20. Events of Default; Remedies..............................................................................32
21. Additional Remedies......................................................................................34
22. Right to Cure Defaults...................................................................................36
23. Late Payment Charge......................................................................................36
24. Prepayment...............................................................................................37
25. Prepayment After Event of Default........................................................................37
26. Appointment of Receiver..................................................................................37
27. Security Agreement.......................................................................................37
28. Authority................................................................................................38
29. Actions and Proceedings..................................................................................39
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30. Further Acts, Etc. ......................................................................................39
31. Recording of Mortgage, Etc. .............................................................................39
32. Usury Laws...............................................................................................39
33. Sole Discretion of Mortgagee.............................................................................40
34. Recovery of Sums Required To Be Paid.....................................................................40
35. Marshalling and Other Matters............................................................................40
36. Waiver of Notice.........................................................................................40
37. Remedies of Mortgagor....................................................................................40
38. Reporting Requirements...................................................................................41
39. Hazardous Materials......................................................................................41
40. Asbestos.................................................................................................44
41. Bankruptcy or Insolvency.................................................................................44
42. Compliance with ERISA and State Statutes on Governmental Plans...........................................45
43. Assignments..............................................................................................46
44. Cooperation..............................................................................................46
45. Indemnification for Non-Recourse Carveout Obligations....................................................46
46. Exculpation..............................................................................................47
47. Notices..................................................................................................48
48. Non-Waiver...............................................................................................49
49. Joint and Several Liability..............................................................................49
50. Severability.............................................................................................49
51. Duplicate Originals......................................................................................49
52. Indemnity and Mortgagee's Costs..........................................................................49
53. Certain Definitions......................................................................................50
54. No Oral Change...........................................................................................50
55. No Foreign Person........................................................................................50
56. Separate Tax Lot.........................................................................................51
57. Right to Release Any Portion of the Mortgaged Property...................................................51
58. Subrogation..............................................................................................51
59. Administrative Fees......................................................................................51
60. Disclosure...............................................................................................51
61. Headings, Etc. ..........................................................................................51
62. Address of Real Property.................................................................................51
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63. Intentionally Deleted....................................................................................52
64. Publicity................................................................................................52
65. Relationship.............................................................................................52
66. Homestead................................................................................................52
67. No Third Party Beneficiaries.............................................................................52
68. Compliance with Regulation U.............................................................................52
69. Entire Agreement.........................................................................................52
70. Servicer.................................................................................................52
71. Governing Law; Consent to Jurisdiction...................................................................52
72. Phase II Property; Amendment to Mortgage.................................................................53
73. Special State Provisions.................................................................................54
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Loan No. 6518291
INDEX OF DEFINED TERMS
Additional Land...............................................................................................1
Architect.....................................................................................................7
Assignee.....................................................................................................14
Assignment of Leases and Rents...............................................................................14
Assignor.....................................................................................................14
Bankruptcy Code...............................................................................................3
Code.........................................................................................................35
Collateral...................................................................................................34
Depository....................................................................................................9
Equipment.....................................................................................................2
ERISA........................................................................................................41
GAAP.........................................................................................................28
Guarantors...................................................................................................27
Guaranty.....................................................................................................46
Improvements..................................................................................................2
Indebtedness..................................................................................................1
Land..........................................................................................................1
Late Charge..................................................................................................33
Leases........................................................................................................3
Loan..........................................................................................................1
Loan Documents...............................................................................................46
Management Agreement.........................................................................................25
Manager......................................................................................................25
Mortgage......................................................................................................1
Mortgaged Property........................................................................................1, 47
Mortgagee.................................................................................................1, 46
Mortgagor.................................................................................................1, 46
Non-Recourse Carveout Obligations............................................................................43
Note......................................................................................................1, 46
Other Charges................................................................................................10
Permitted Encumbrances........................................................................................5
Person.......................................................................................................46
Policies......................................................................................................6
Rating Agencies..............................................................................................19
Real Property.................................................................................................2
Rents.....................................................................................................3, 14
Repair and Remediation Reserve Fund..........................................................................13
Replacement Reserve Agreement................................................................................12
Replacement Reserve Fund.....................................................................................11
Reserve Fund.................................................................................................13
Restoration...................................................................................................6
Secondary Market Transactions................................................................................42
Servicer.....................................................................................................49
Small Lease..................................................................................................15
Tax and Insurance Fund.......................................................................................11
Loan No. 6518291
Taxes........................................................................................................10
Tenant Improvement and Leasing Commission Reserve............................................................12
Tenant Improvement and Leasing Commission Reserve Fund.......................................................12
Termination Amount.......................................................................................... 15
Transferee...................................................................................................18
Uniform Commercial Code.......................................................................................2
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Loan No. 6518291
THIS
MORTGAGE, ASSIGNMENT OF LEASES AND RENTS AND SECURITY AGREEMENT
(this "MORTGAGE"), made as of the 9th day of April, 2004, by INLAND WESTERN
SPARTANBURG, L.L.C., a Delaware limited liability company, having its principal
place of business at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
("MORTGAGOR"), to and for the benefit OF ▇▇▇▇ ▇▇▇▇▇▇▇ LIFE INSURANCE COMPANY, a
Massachusetts corporation having its principal place of business at ▇▇▇▇ ▇▇▇▇▇▇▇
Tower, T-56, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ("MORTGAGEE").
WITNESSETH:
For the consideration of Ten Dollars and other good and valuable
consideration received to its full satisfaction and to secure the payment of an
indebtedness in the principal sum of Twenty-seven Million Six Hundred Ten
Thousand and No/100 Dollars ($27,610,000.00), lawful money of the United States
of America, to be paid with interest and all other sums and fees payable
according to a certain mortgage note dated the date hereof made by Mortgagor to
Mortgagee (the mortgage note, together with all extensions, renewals or
modifications thereof, being hereinafter collectively called the "NOTE"; and the
loan evidenced by the Note being hereinafter referred to as the "LOAN") and all
indebtedness, obligations, liabilities and expenses due hereunder and under any
other Loan Document (as hereinafter defined) (the indebtedness, interest, other
sums, fees, obligations and all other sums due under the Note and/or hereunder
and/or any other Loan Document being collectively called the "INDEBTEDNESS"),
Mortgagor has mortgaged, given, granted, bargained, sold, alienated, enfeoffed,
conveyed, confirmed, pledged, assigned, hypothecated, remised, released,
transferred, delivered, warranted and confirmed and by these presents does
mortgage, give, grant, bargain, sell, alien, enfeoff, convey, confirm, pledge,
assign, hypothecate, remise, release, transfer, deliver, setover, warrant and
confirm unto Mortgagee and hereby grants unto Mortgagee a security interest in
the following property and rights, whether now owned or held or hereafter
acquired (collectively, the "MORTGAGED PROPERTY"):
GRANTING CLAUSE ONE
All right, title and interest in and to the real property or
properties described on EXHIBIT A hereto (collectively, the "LAND").
GRANTING CLAUSE TWO
All ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ and development rights hereafter
acquired by Mortgagor for use in connection with the Land and the development of
the Land and all additional lands and estates therein which may, from time to
time, by supplemental mortgage or otherwise, be expressly made subject to the
lien thereof (collectively, the "ADDITIONAL LAND").
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GRANTING CLAUSE THREE
Any and all buildings, structures, fixtures, additions, enlargements,
extensions, modifications, repairs, replacements and improvements now or
hereafter located on the Land or any part thereof (collectively, the
"IMPROVEMENTS"; the Land, the Additional Land and the Improvements hereinafter
collectively referred to as the "REAL PROPERTY").
GRANTING CLAUSE FOUR
All easements, rights-of-way, strips and gores of land, streets, ways,
alleys, passages, sewer rights, water, water courses, water rights and powers,
oil, gas and mineral rights, air rights and development rights, zoning rights,
tax credits or benefits and all estates, rights, titles, interests, privileges,
liberties, tenements, hereditaments and appurtenances of any nature whatsoever
in any way now or hereafter belonging, relating or pertaining to the Real
Property or any part thereof and the reversion and reversions, remainder and
remainders and all land lying in the bed of any street, road or avenue, opened
or proposed, in front of or adjoining the Land or any part thereof to the center
line thereof and all the estates, rights, titles, interests, dower and rights of
dower, curtesy and rights of curtesy, property, possession, claim and demand
whatsoever, both in law and in equity, of Mortgagor in, of and to the Real
Property and every part and parcel thereof, with the appurtenances thereto.
GRANTING CLAUSE FIVE
All machinery, equipment, fixtures and other property of every kind
and nature whatsoever owned by Mortgagor or in which Mortgagor has or shall have
an interest (to the extent of such interest) now or hereafter located upon the
Real Property or appurtenant thereto and usable in connection with the present
or future operation and occupancy of the Real Property and all building
equipment, materials and supplies of any nature whatsoever owned by Mortgagor or
in which Mortgagor has or shall have an interest (to the extent of such
interest) now or hereafter located upon the Real Property or appurtenant thereto
or usable in connection with the present or future operation and occupancy of
the Real Property, including but not limited to all heating, ventilating, air
conditioning, plumbing, lighting, communications and elevator machinery,
equipment and fixtures (hereinafter collectively called the "EQUIPMENT") and the
right, title and interest of Mortgagor in and to any of the Equipment which may
be subject to any security agreements (as defined in the Uniform Commercial Code
of the State in which the Mortgaged Property is located (the "UNIFORM COMMERCIAL
CODE")) superior, inferior or PARI PASSU in lien to the lien of this Mortgage.
In connection with Equipment which is leased to Mortgagor or which is subject to
a lien or security interest which is superior to the lien of this Mortgage, this
Mortgage shall also cover all right, title and interest of each Mortgagor in and
to all deposits and the benefit of all payments now or hereafter made with
respect to such Equipment.
GRANTING CLAUSE SIX
All awards or payments, including interest thereon, which may
heretofore and hereafter be made with respect to the Real Property or any part
thereof, whether from the exercise of the right of eminent domain (including but
not limited to any transfer made in lieu of
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or in anticipation of the exercise of said right), or for a change of grade or
for any other injury to or decrease in the value of the Real Property.
GRANTING CLAUSE SEVEN
All leases and subleases (including, without limitation, all
guarantees thereof) and other agreements affecting the use, enjoyment and/or
occupancy of the Real Property or any part thereof, now or hereafter entered
into (including any use or occupancy arrangements created pursuant to Section
365(h) of Title 11 of the United States Code (the "BANKRUPTCY CODE") or
otherwise in connection with the commencement or continuance of any bankruptcy,
reorganization, arrangement, insolvency, dissolution, receivership or similar
proceedings or any assignment for the benefit of creditors in respect of any
tenant or occupant of any portion of the Real Property), together with any
extension or renewal of the same (the "LEASES") and all income, rents, issues,
profits, revenues and proceeds including, but not limited to, all oil and gas or
other mineral royalties and bonuses from the Real Property (including any
payments received pursuant to Section 502(b) of the Bankruptcy Code or otherwise
in connection with the commencement or continuance of any bankruptcy,
reorganization, arrangement, insolvency, dissolution, receivership or similar
proceedings or any assignment for the benefit of creditors in respect of any
tenant or occupant of any portion of the Real Property and all claims as a
creditor in connection with any of the foregoing) (the "RENTS") and all
proceeds from the sale, cancellation, surrender or other disposition of the
Leases and the right to receive and apply the Rents to the payment of the
Indebtedness.
GRANTING CLAUSE EIGHT
All proceeds of and any unearned premiums on any insurance policies
covering the Real Property or any part thereof including, without limitation,
the right to receive and apply the proceeds of any insurance, judgments or
settlements made in lieu thereof, for damage to the Real Property or any part
thereof.
GRANTING CLAUSE NINE
All tax refunds, including interest thereon, tax credits and tax
abatements and the right to receive or benefit from the same, which may be
payable or available with respect to the Real Property.
GRANTING CLAUSE TEN
The right, in the name and on behalf of Mortgagor, to appear in and
defend any action or proceeding brought with respect to the Real Property or any
part thereof and to commence any action or proceeding to protect the interest of
Mortgagee in the Real Property or any part thereof.
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GRANTING CLAUSE ELEVEN
All accounts receivable, utility or other deposits, intangibles,
contract rights, interests, estates or other claims, both in law and in equity,
which Mortgagor now has or may hereafter acquire in the Real Property or any
part thereof.
GRANTING CLAUSE TWELVE
All rights which Mortgagor now has or may hereafter acquire to be
indemnified and/or held harmless from any liability, loss, damage, cost or
expense (including, without limitation, attorneys' fees and disbursements)
relating to the Real Property or any part thereof.
GRANTING CLAUSE THIRTEEN
All plans and specifications, maps, surveys, studies, reports,
contracts, subcontracts, service contracts, management contracts, franchise
agreements and other agreements, franchises, trade names (excluding any trade
names to the extent they include therein the name "Inland"), trademarks
(excluding any trademarks to the extent they include therein the name "Inland"),
symbols, service marks, approvals, consents, permits, special permits, licenses
and rights, whether governmental or otherwise, respecting the use, occupation,
development, construction and/or operation of the Real Property or any part
thereof or the activities conducted thereon or therein, or otherwise pertaining
to the Real Property or any part thereof.
GRANTING CLAUSE FOURTEEN
All proceeds, products, offspring, rents and profits from any of the
foregoing, including without limitation, those from sale, exchange, transfer,
collection, loss, damage, disposition, substitution or replacement of any of the
foregoing.
WITH RESPECT to any portion of the Mortgaged Property which is not
real estate under the laws of the State in which the Mortgaged Property is
located, Mortgagor hereby grants, bargains, sells and conveys the same to
Mortgagee for the purposes set forth hereunder and Mortgagee shall be vested
with all rights, power and authority granted hereunder or by law to Mortgagee
with respect thereto.
TO HAVE AND TO HOLD the above granted and described Mortgaged Property
unto and to the use and benefit of Mortgagee and the successors and assigns of
Mortgagee forever.
PROVIDED, HOWEVER, these presents are upon the express condition, if
Mortgagor shall well and truly pay to Mortgagee the Indebtedness at the time and
in the manner provided in the Note and this Mortgage and shall well and truly
abide by and comply with each and every covenant and condition set forth herein,
in the Note and in the other Loan Documents, this Mortgage and the estate hereby
granted shall be released and canceled of record at the request and at the cost
of Mortgagor.
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Loan No. 6518291
This Mortgage covers goods which are or are to become fixtures, is
effective as a financing statement filed as a fixture filing and is to be filed
in the real estate records.
AND Mortgagor represents to, covenants with and warrants to Mortgagee
that:
PART 1 - GENERAL PROVISIONS
1. PAYMENT OF INDEBTEDNESS AND INCORPORATION OF COVENANTS,
CONDITIONS AND AGREEMENTS. Mortgagor shall pay the Indebtedness at the time and
in the manner provided in the Note, this Mortgage and the other Loan Documents.
All the covenants, conditions and agreements contained in the Note and the other
Loan Documents are hereby made a part of this Mortgage to the same extent and
with the same force as if fully set forth herein.
2. WARRANTY OF TITLE. Mortgagor has good and marketable title to the
Mortgaged Property; Mortgagor has the right to mortgage, give, grant, bargain,
sell, alienate, enfeoff, convey, confirm, pledge, lease, assign, hypothecate and
grant a security interest in the Mortgaged Property; Mortgagor possesses an
indefeasible fee estate in the Real Property; and Mortgagor owns the Mortgaged
Property free and clear of all liens, encumbrances and charges whatsoever except
those exceptions shown in the title insurance policy insuring the lien of this
Mortgage (this Mortgage and the liens, encumbrances and charges shown as
exceptions in such title policy, hereinafter collectively referred to as the
"PERMITTED ENCUMBRANCES"). Mortgagor shall forever warrant, defend and preserve
such title and the validity and priority of the lien of this Mortgage and shall
forever warrant and defend the same to Mortgagee against the claims of all
persons whomsoever.
3. INSURANCE; CASUALTY.
(a) Mortgagor, at its sole cost and expense, shall keep the
Mortgaged Property insured during the term of this Mortgage for the mutual
benefit of Mortgagor and Mortgagee against loss or damage by any peril covered
by a standard "special perils" or "all-risk-of-physical-loss" insurance policy
including, without limitation, riot and civil commotion, acts of terrorism,
vandalism, malicious mischief, burglary, theft and mysterious disappearance in
an amount (i) equal to at least one hundred percent (100%) of the then "full
replacement cost" of the Improvements and Equipment, without deduction for
physical depreciation and (ii) such that the insurer would not deem Mortgagor a
coinsurer under such policies. The policies of insurance carried in accordance
with this PARAGRAPH 3 shall be paid annually in advance and shall contain the
"Replacement Cost Endorsement" with a waiver of depreciation, and shall have a
deductible no greater than $10,000 unless so agreed by Mortgagee.
(b) Mortgagor, at its sole cost and expense, for the mutual
benefit of Mortgagor and Mortgagee, shall also obtain and maintain during the
term of this Mortgage the following policies of insurance:
(i) Flood insurance if any part of the Real Property is located
in an area identified by the Secretary of Housing and Urban Development as
an area having special flood hazards and in which flood insurance has been
made available under the National Flood Insurance Act of 1968 (and any
successor act thereto) in an amount at
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Loan No. 6518291
least equal to the outstanding principal amount of the Note or the maximum
limit of coverage available with respect to the Improvements and Equipment
under said Act, whichever is less.
(ii) Comprehensive public liability insurance, including broad
form property damage, blanket contractual and personal injuries (including
death resulting therefrom) coverages.
(iii) Rental loss insurance in an amount equal to at least one
hundred percent (100%) of the aggregate annual amount of all rents and
additional rents payable by all of the tenants under the Leases (whether or
not such Leases are terminable in the event of a fire or casualty), such
rental loss insurance to cover rental losses for a period of at least one
(1) year after the date of the fire or casualty in question. The amount of
such rental loss insurance shall be adjusted no less frequently than
annually during the term of this Mortgage to reflect all increased rent and
increased additional rent payable by all of the tenants under renewal
Leases entered into in accordance with the terms of this Mortgage and all
rent and additional rent payable by all of the tenants under new Leases
entered into in accordance with the terms of this Mortgage.
(iv) Insurance against loss or damage from explosion of steam
boilers, air conditioning equipment, high pressure piping, machinery and
equipment, pressure vessels or similar apparatus now or hereafter installed
in the Improvements.
(v) Such other insurance (including, without limitation,
earthquake insurance) as may from time to time be reasonably required by
Mortgagee in order to protect its interests or, in the event of a Secondary
Market Transaction, as required by the Rating Agencies (as such terms are
hereinafter defined).
(c) All policies of insurance (the "POLICIES") required
pursuant to this PARAGRAPH 3 (i) shall be issued by an insurer satisfactory to
Mortgagee (and, in the event of a Secondary Market Transaction, to the Rating
Agencies), (ii) shall contain the standard New York mortgagee non-contribution
clause naming Mortgagee as the person to which all payments made by such
insurance company shall be paid, (iii) shall be maintained throughout the term
of this Mortgage without cost to Mortgagee, (iv) shall be delivered to
Mortgagee, (v) shall contain such provisions as Mortgagee deems reasonably
necessary or desirable to protect its interest including, without limitation,
endorsements providing that neither Mortgagor, Mortgagee nor any other party
shall be a co-insurer under such Policies and that Mortgagee shall receive at
least thirty (30) days prior written notice of any modification or cancellation
and (vi) shall be reasonably satisfactory in form and substance to Mortgagee
(and, in the event of a Secondary Market Transaction, to the Rating Agencies)
and shall be approved by Mortgagee (and, in the event of a Secondary Market
Transaction, by the Rating Agencies) as to amounts, form, risk coverage,
deductibles, loss payees and insureds. All amounts recoverable thereunder are
hereby assigned to the Mortgagee. Not later than thirty (30) days prior to the
expiration date of each of the Policies, Mortgagor will deliver to Mortgagee
satisfactory evidence of the renewal of each of the Policies.
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(d) If the Improvements shall be damaged or destroyed, in whole
or in part, by fire or other casualty, Mortgagor shall give prompt notice
thereof to Mortgagee and prior to the making of any repairs thereto. Following
the occurrence of fire or other casualty, Mortgagor, regardless of whether
insurance proceeds are payable under the Policies or, if paid, are made
available to Mortgagor by Mortgagee, shall promptly proceed with the repair,
alteration, restoration, replacement or rebuilding of the Improvements as near
as possible to their value, utility, condition and character prior to such
damage or destruction. Such repairs, alterations, restoration, replacement and
rebuilding are herein collectively referred to as the "RESTORATION". The
Restoration shall be performed in accordance with the following provisions:
(i) Mortgagor shall procure, pay for and furnish to Mortgagee
true copies of all required governmental permits, certificates and
approvals with respect to the Restoration.
(ii) Mortgagor shall furnish Mortgagee, within thirty (30) days
of the casualty, evidence reasonably satisfactory to Mortgagee of the cost
to complete the Restoration.
(iii) If the Restoration involves structural work or the
estimated cost to complete the Restoration exceeds five percent (5%) of the
original principal amount of the Loan, the Restoration shall be conducted
under the supervision of an architect (the "ARCHITECT") selected by
Mortgagor and approved by Mortgagee (which approval shall not be
unreasonably withheld), and no such Restoration shall be made except in
accordance with detailed plans and specifications, detailed cost estimates
and detailed work schedules approved by Mortgagee (which approval shall not
be unreasonably withheld).
(iv) If the estimated cost of the Restoration shall exceed
twenty-five percent (25%) of the fair market value of the Mortgaged
Property, at the request of Mortgagee, Mortgagor, before commencing any
work, shall cause to be furnished to Mortgagee a surety bond or bonds, in
form and substance reasonably satisfactory to Mortgagee, naming Mortgagor
and Mortgagee as co-obligees, in an amount that is not less than the
estimated cost of the Restoration, issued by a surety company or companies
reasonably satisfactory to Mortgagee.
(v) The Restoration shall be prosecuted to completion with all
due diligence and in an expeditious and first class workmanlike manner and
in compliance with all laws and other governmental requirements, all
permits, certificates and approvals, all requirements of fire underwriters
and all insurance policies then in force with respect to the Real Property.
(vi) At all times when any work is in progress, Mortgagor shall
maintain all insurance then required by law or customary with respect to
such work, and, prior to the commencement of any work, shall furnish to
Mortgagee duplicate originals or certificates of the policies therefor.
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Loan No. 6518291
(vii) Upon completion of the Restoration, Mortgagor shall obtain
(A) any occupancy permit which may be required for the Improvements and (B)
all other governmental permits, certificates and approvals and all permits,
certificates and approvals of fire underwriters which are required for or
with respect to the Restoration, and shall furnish true copies thereof to
Mortgagee.
(viii) An Event of Default (as hereinafter defined) shall be
deemed to have occurred under this Mortgage if Mortgagor, after having
commenced demolition or construction of any Improvements, shall abandon
such demolition or the construction work or shall fail to complete such
demolition and construction within a reasonable time after the commencement
thereof.
(e) If the estimated cost of the Restoration is $50,000.00 or
less, and so long as no Event of Default then exists under any of the Loan
Documents, Mortgagor shall be entitled to adjust and settle the insurance claim
without the consent or participation of Mortgagee and Mortgagor shall be
entitled to receive the payment for such loss. Mortgagor and Mortgagee shall
jointly adjust and settle all insurance claims over $50,000.00, PROVIDED,
HOWEVER, if an Event of Default shall have occurred and be continuing, Mortgagee
shall have the right to adjust and settle such claims without the prior consent
of Mortgagor. In the event of any insured loss, the payment for such loss shall
be made directly to Mortgagee. Any insurance proceeds payable under any of the
Policies in excess of $50,000.00 (and, if an Event of Default then exists
hereunder, any insurance proceeds of $50,000.00 or less) may, at the option of
Mortgagee, be used in one or more of the following ways: (w) applied to the
Indebtedness, whether such Indebtedness then be matured or unmatured (such
application to be without prepayment fee or premium, except that if an Event of
Default, or an event which with notice and/or the passage of time, or both,
would constitute an Event of Default, has occurred and remains uncured, then
such application shall be subject to the applicable premium computed in
accordance with the Note), (x) used to fulfill any of the covenants contained
herein as the Mortgagee may determine, (y) used to replace or restore the
property to a condition satisfactory to the Mortgagee, or (z) released to the
Mortgagor. Notwithstanding the foregoing, provided: (i) not more than forty
percent (40%) of the gross area of the Improvements is directly affected by such
damage, destruction or loss and the amount of the loss does not exceed
twenty-five percent (25%) of the fair market value of the Mortgaged Property,
(ii) no Event of Default or event that with the passage of time or giving of
notice or both would constitute a default has occurred hereunder, under the Note
or under any of the other Loan Documents and remains uncured at the time of such
application, (iii) the insurer does not deny liability to any named insured,
(iv) each major and/or anchor tenant (as determined by Mortgagee) whose Lease
permits termination thereof as a result of such insured loss, agrees in writing
to continue its Lease, (v) rental loss insurance is available and in force and
effect to offset in full any abatement of rent to which any tenant may be
entitled as a result of such damage, destruction or loss, (vi) the remaining
Improvements continue at all times to comply with all applicable building,
zoning and other land use laws and regulations, (vii) in Mortgagee's judgment,
the Restoration is practicable and can be completed within one (1) year after
the damage, destruction or loss and at least one (1) year prior to the Maturity
Date (as such term is defined in the Note), and (viii) rebuilding of the
Improvements to substantially identical size, condition and use as existed prior
to the casualty is permitted by all applicable laws and ordinances, then all of
such proceeds shall be used for Restoration.
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Notwithstanding the foregoing, such proceeds shall be used for Restoration to
the extent required under the terms of any existing leases of any portion of the
Mortgaged Property. Any application of insurance proceeds to the Indebtedness
shall be to the unpaid installments of principal due under the Note in the
inverse order of their maturity, such that the regular payments under the Note
shall not be reduced or altered in any manner. In the event the above criteria
are satisfied (including that no Event of Default or event that, with the
passage of time or giving of notice or both, would constitute a default has
occurred hereunder, under the Note or other Loan Documents) or Mortgagee
otherwise elects to allow the use of such proceeds for the Restoration, such
proceeds shall be disbursed in accordance with the following provisions:
(i) Each request for an advance of insurance proceeds shall be
made on seven (7) days' prior notice to Mortgagee and shall be accompanied
by a certificate of the Architect, if one be required under PARAGRAPH
3(d)(iii) above, otherwise by an executive officer or managing general
partner or managing member of Mortgagor, stating (A) that all work
completed to date has been performed in compliance with the approved plans
and specifications and in accordance with all provisions of law, (B) the
sum requested is properly required to reimburse Mortgagor for payments by
Mortgagor to, or is properly due to, the contractor, subcontractors,
materialmen, laborers, engineers, architects or other persons rendering
services or materials for the Restoration (giving a brief description of
such services and materials), and that when added to all sums, if any,
previously disbursed by Mortgagee, does not exceed the value of the work
done to the date of such certificate and (C) that the amount of such
proceeds remaining in the hands of Mortgagee will be sufficient on
completion of the work to pay the same in full (giving, in such reasonable
detail as Mortgagee may require, an estimate of the cost of such
completion).
(ii) Each request for an advance of insurance proceeds shall, to
the extent permitted under applicable law, be accompanied by waivers of
liens satisfactory to Mortgagee covering that part of the Restoration
previously paid for, if any, and by a search prepared by a title company or
by other evidence reasonably satisfactory to Mortgagee including without
limitation a title endorsement satisfactory to Mortgagee if available in
the state where the Real Property is located, that there has not been filed
with respect to the Real Property any mechanic's lien or other lien or
instrument and that there exist no encumbrances on or affecting the Real
Property other than the Permitted Encumbrances or otherwise approved by
Mortgagee. In addition to the foregoing, the request for the final advance
shall be accompanied by (A) any final occupancy permit which may be
required for the Improvements, (B) all other governmental permits,
certificates and approvals and all other permits necessary for the
occupancy and operation of the Real Property, (C) Tenant estoppels from
tenants whose space was affected and (D) final lien waivers from all
contractors, subcontractors and materialmen.
(iii) No advance of insurance proceeds shall be made if there
exists an Event of Default or event which with the passage of time or the
giving of notice or both would constitute a default on the part of
Mortgagor under this Mortgage, the Note or any other Loan Document.
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(iv) If the cost of the Restoration (as reasonably estimated by
Mortgagee) at any time shall exceed the amount of the insurance proceeds
available therefor, insurance proceeds shall not be advanced until
Mortgagor, before commencing the Restoration or continuing the Restoration,
as the case may be, shall deposit the full amount of the deficiency (or
other assurances reasonably satisfactory to Mortgagee) with Mortgagee and
the amount so deposited shall first be applied toward the cost of the
Restoration before any portion of the insurance proceeds is disbursed for
such purpose.
Upon completion of the Restoration and payment in full therefor, or
upon failure on the part of Mortgagor promptly to commence or diligently to
continue the Restoration, or at any time upon request by Mortgagor, Mortgagee
may apply the amount of any such proceeds then or thereafter in the hands of
Mortgagee to the payment of the Indebtedness; PROVIDED, HOWEVER, that nothing
herein contained shall prevent Mortgagee from applying at any time the whole or
any part of such proceeds to the curing of any default that has not been cured
within the applicable cure period under this Mortgage, the Note or any other
Loan Document.
(f) Insurance proceeds and any additional funds deposited by
Mortgagor with Mortgagee shall constitute additional security for the
Indebtedness. Mortgagor shall execute, deliver, file and/or record, at its
expense, such documents and instruments as Mortgagee deems necessary or
advisable to grant to Mortgagee a perfected, first priority security interest in
the insurance proceeds and such additional funds. If Mortgagee elects to have
the insurance proceeds applied to Restoration, (i) the insurance proceeds shall
be, at Mortgagee's election, disbursed in installments by Mortgagee or by a
disbursing agent ("DEPOSITORY") selected by Mortgagee and whose fees and
expenses shall be paid by Mortgagor in the manner provided in PARAGRAPH 3(e)
above and (ii) all costs and expenses incurred by Mortgagee in connection with
the Restoration, including, without limitation, reasonable counsel fees and
costs, shall be paid by Mortgagor.
4. PAYMENT OF TAXES, ETC.
(a) Mortgagor shall pay or cause to be paid all taxes,
assessments, water rates and sewer rents, now or hereafter levied or assessed or
imposed against the Mortgaged Property or any part thereof (the "TAXES") and all
ground rents, maintenance charges, other governmental impositions, and other
charges levied, assessed or imposed against the Mortgaged Property, including,
without limitation, vault charges and license fees (collectively, "Other
Charges") for the use of vaults, chutes and similar areas adjoining the Real
Property, as same become due and payable. Mortgagor will deliver to Mortgagee,
promptly upon Mortgagee's request, evidence satisfactory to Mortgagee that the
Taxes and Other Charges have been so paid and are not then delinquent. Mortgagor
shall not suffer or permit any lien or charge (including, without limitation,
any mechanic's lien) against all or any part of the Mortgaged Property and
Mortgagor shall promptly cause to be paid and discharged any lien or charge
whatsoever which may be or become a lien or charge against the Mortgaged
Property. Mortgagor shall promptly pay for all utility services provided to the
Mortgaged Property. In addition, Mortgagee may, at its option, retain the
services of a firm to monitor the payment of Taxes, the cost of which shall be
borne by Mortgagor.
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(b) Notwithstanding the provisions of subsection (a) of this
PARAGRAPH 4, Mortgagor shall have the right to contest in good faith the amount
or validity of any such Taxes, liens or Other Charges (including, without
limitation, tax liens and mechanics' liens) referred to in subsection (a) above
by appropriate legal proceedings and in accordance with all applicable law,
after notice to, but without cost or expense to, Mortgagee, provided that (i) no
Event of Default or event that, with the passage of time or giving of notice or
both, would constitute a default hereunder, under the Note or other Loan
Documents has occurred and is continuing, (ii) Mortgagor pays such Taxes, liens
or Other Charges as same become due and payable, unless Mortgagor delivers
evidence satisfactory to Mortgagee that, as a result of Mortgagor's contest,
Mortgagor's obligation to pay such Taxes, liens or Other Charges has been
deferred by the appropriate governmental authority, in which event, Mortgagor
may defer such payment of such Taxes, liens or Other Charges until the date
specified by such governmental authority, (iii) such contest shall be promptly
and diligently prosecuted by and at the expense of Mortgagor, (iv) Mortgagee
shall not thereby suffer any civil penalty, or be subjected to any criminal
penalties or sanctions, (v) such contest shall be discontinued and such Taxes,
liens or Other Charges promptly paid if at any time all or any part of the
Mortgaged Property shall be in imminent danger of being foreclosed, sold,
forfeited or otherwise lost or if the title, lien and security interest created
by this Mortgage or the priority thereof shall be in imminent danger of being
impaired, (vi) Mortgagor shall have set aside adequate reserves (in Mortgagee's
judgment) for the payment of such Taxes, liens or Other Charges, together with
all interest and penalties thereon and (vii) Mortgagor shall have furnished such
security as may be reasonably required in the proceeding or as may be requested
by Mortgagee, to insure the payment of any such Taxes, liens or Other Charges,
together with all interest and penalties thereon.
5. RESERVE FUND.
(a) TAX AND INSURANCE FUND. Mortgagor shall pay to Mortgagee on
the first day of each calendar month such amounts as Mortgagee from time to time
estimates to be sufficient to create and maintain a reserve fund from which (i)
to pay the Taxes and Other Charges, at least thirty (30) days prior to the date
they are due without the payment of any penalties or interest, and (ii) to pay,
at least thirty (30) days prior to their due date for the renewal of the
coverage afforded by the Policies upon the expiration thereof, the insurance
premiums for the Policies estimated by Mortgagee to be payable on such due date,
(said amounts in (i) and (ii) above hereafter called the "Tax and Insurance
Fund").
(1) Notwithstanding the foregoing clause (i) of this
subsection (a), provided (X) Inland Western Spartanburg, L.L.C. or a Permitted
Affiliated Transferee, as defined in Paragraph 9(h) below, or a Transferee
approved by Mortgagee pursuant to Paragraph 9(f) below is and remains the owner
of the Mortgaged Property, (Y) no Event of Default has occurred and is
continuing under this Mortgage or any of the Loan Documents beyond any
applicable notice or cure period, (Z) Mortgagor pays such Taxes and Other
Charges prior to the date they are due and prior to the assessment of any
penalties or interest and provides, upon request, evidence of such timely
payment to Mortgagee, then Mortgagee will not require Mortgagor to make the
deposits referred to in clause (i) of this subsection (a). In the event
Mortgagor is hereafter required to make the deposits referred to in clause (i)
of this subsection (a) on account of Mortgagor's failure to satisfy all of the
requirements of the preceding sentence,
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Mortgagor agrees at Mortgagor's sole cost and expense, upon request thereafter
of Mortgagee, to promptly execute and deliver to Mortgagee a written agreement
for the making of such deposits in the future.
(2) Notwithstanding the foregoing clause (ii) of this
subsection (a), provided (X) no Event of Default has occurred and is continuing
under this Mortgage or any of the Loan Documents beyond any applicable notice or
cure period, (Y) Inland Western Spartanburg, L.L.C. or a Permitted Affiliated
Transferee, as defined in Paragraph 9(h) below, or a Transferee approved by
Mortgagee pursuant to Paragraph 9(f) below is and remains the owner of the
Mortgaged Property, and (Z) Mortgagor complies in full with all obligations in
the Loan Documents regarding insurance, including without limitation providing
Mortgagee with timely evidence (i) that the required insurance is in place for
the Mortgaged Property and is never delinquent or suspended, and (ii) that all
insurance premiums are paid when due, then Mortgagee will not require Mortgagor
to make the deposits referred to in clause (ii) of this subsection (a). In the
event Mortgagor is hereafter required to make the deposits referred to in clause
(ii) of this subsection (a) on account of Mortgagor's failure to satisfy all of
the requirements of the preceding sentence, Mortgagor agrees at Mortgagor's sole
cost and expense, upon request thereafter of Mortgagee, to promptly execute and
deliver to Mortgagee a written agreement for the making of such deposits in the
future.
(b) REPLACEMENT RESERVE FUND. If required by Mortgagee,
Mortgagor shall enter into a Replacement Reserve Agreement which shall require
Mortgagor to pay to Mortgagee on the first day of each calendar month one
twelfth (1/12) of the amount reasonably estimated by Mortgagee to be due for the
replacements and capital repairs required to be made to the Mortgaged Property
during each calendar year (the "REPLACEMENT RESERVE FUND"). Mortgagee shall make
disbursements from the Replacement Reserve Fund for items specified in the
Replacement Reserve Agreement as set forth in such Agreement. Mortgagee may
require an inspection of the Mortgaged Property prior to making a disbursement
in order to verify completion of replacements and repairs. Mortgagee reserves
the right to make any disbursement from the Replacement Reserve Fund directly to
the party furnishing materials and/or services.
Notwithstanding the foregoing, provided: (W) no Event of Default
has occurred and is continuing under this Mortgage or any of the Loan Documents
beyond any applicable notice or cure period, (X) Inland Western Spartanburg,
L.L.C. or a Permitted Affiliated Transferee, as defined in Paragraph 9(h) below,
or a Transferee approved by Mortgagee pursuant to Paragraph 9(f) below is and
remains the owner of the Mortgaged Property, (Y) Mortgagor has complied in full
with all obligations set forth in this Mortgage and in the other Loan Documents
regarding maintaining the Mortgaged Property, including without limitation
maintaining the Mortgaged Property in good order and repair, and (Z) inspections
of the Mortgaged Property do not uncover the necessity of creating or
reinstating the Replacement Reserve Fund, in Mortgagee's sole discretion, then
Mortgagee will not require Mortgagor to make the deposits referred to in this
subsection (b). In the event Mortgagor is hereafter required to make the
deposits referred to in this subsection (b) on account of Mortgagor's failure to
satisfy all of the requirements of the preceding sentence, Mortgagor agrees at
Mortgagor's sole cost and expense, upon request thereafter of Mortgagee, to
promptly execute and deliver to Mortgagee a written agreement for the making of
such deposits in the future.
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(c) TENANT IMPROVEMENT AND LEASING COMMISSION RESERVE. If
required by Mortgagee, Mortgagor shall enter into a Tenant Improvement and
Leasing Commission Agreement which shall require Mortgagor to pay to Mortgagee
on the first day of each calendar month deposits for tenant improvements and
leasing commissions in amounts determined by Mortgagee in its sole discretion,
for payment of costs and expenses incurred by Mortgagor in connection with the
performance of work to refit and release space in the Improvements that is
currently vacant or anticipated to be vacated during the term of the Loan, and
for payment of leasing commissions incurred by Mortgagor in connection with the
releasing of space in the Improvements that is currently vacant or anticipated
to be vacated during the term of the Loan (the "TENANT IMPROVEMENT AND LEASING
COMMISSION RESERVE FUND"), all according to the Tenant Improvement and Leasing
Commission Agreement.
Notwithstanding the foregoing, provided no Event of Default has
occurred and is continuing under this Mortgage or any of the Loan Documents
beyond any applicable notice or cure period and no condition or event exists
which with notice, the passage or time, or both, would constitute an Event of
Default under this Mortgage or any of the Loan Documents, then Mortgagee will
not require Mortagor to make the deposits referred to in this subsection (c). In
the event Mortgagor is hereafter required to make the deposits referred to in
this subsection (c) on account of Mortgagor's failure to satisfy all of the
requirements of the preceding sentence, Mortgagor agrees at Mortgagor's sole
cost and expense, upon request thereafter of Mortgagee, to promptly execute and
deliver to Mortgagee a written agreement for the making of such deposits in the
future.
(d) REPAIR AND REMEDIATION RESERVE FUND. If required by
Mortgagee, Mortgagor shall enter into a Reserve Agreement for Repairs and shall
pay to Mortgagee the estimated cost to complete any required repairs (the
"REPAIR AND REMEDIATION RESERVE FUND") as more fully set forth in said
Agreement. Notwithstanding anything herein to the contrary, Mortgagee agrees
that the Repair and Remediation Reserve Fund shall not be required if the
aggregate cost to repair all items set forth in any applicable Property
Condition Assessment, Environmental Assessment or other report is less than
$200,000.00.
The amounts in (a), (b), (c) and (d) above shall hereinafter be
collectively called the "RESERVE FUND". Mortgagor hereby pledges to Mortgagee
any and all monies now or hereafter deposited as the Reserve Fund as additional
security for the payment of the Indebtedness. Mortgagee may apply the Reserve
Fund to payments of Taxes, Other Charges, insurance premiums and, as applicable,
payments for replacements and capital repairs, tenant improvements and leasing
commissions and repairs and remediations required to be made by Mortgagor
pursuant to the terms hereof or pursuant to the terms of any other Loan
Documents (even though subsequent owners of the Mortgaged Property may benefit
thereby); PROVIDED, HOWEVER, if there is an Event of Default which is
continuing, then Mortgagee may credit such Reserve Fund against the Indebtedness
in such priority and proportions as Mortgagee in its discretion shall deem
proper. If the Reserve Fund is not sufficient to fully pay for the Taxes, Other
Charges and/or the insurance premiums or, as applicable, amounts for
replacements and capital repairs, tenant improvements and leasing commissions
and repairs and remediation when due, Mortgagor shall promptly pay to Mortgagee,
upon demand, an amount which Mortgagee shall estimate as sufficient to make up
the deficiency. The Reserve Fund shall not constitute a
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trust fund and may be commingled with other monies held by Mortgagee. No
earnings or interest on the Reserve Fund shall be payable to Mortgagor.
6. CONDEMNATION. Mortgagor shall promptly give Mortgagee written
notice of the actual or threatened commencement of any condemnation or eminent
domain proceeding and shall deliver to Mortgagee copies of any and all papers
served in connection with such proceedings. Following the occurrence of a
condemnation, Mortgagor, regardless of whether an award is available, shall
promptly proceed to restore, repair, replace or rebuild the Improvements to the
extent practicable to be of at least equal value and of substantially the same
character as prior to such condemnation, all to be effected in accordance with
applicable law. Notwithstanding any taking by any public or quasi-public
authority through eminent domain or otherwise (including but not limited to any
transfer made in lieu of or in anticipation of the exercise of such taking),
Mortgagor shall continue to pay the Indebtedness at the time and in the manner
provided for its payment in the Note, in this Mortgage and the other Loan
Documents and the Indebtedness shall not be reduced until any award or payment
therefor shall have been actually received after expenses of collection and
applied by Mortgagee to the discharge of the Indebtedness. Mortgagor shall cause
the award or payment made in any condemnation or eminent domain proceeding,
which is payable to Mortgagor, to be paid directly to Mortgagee. Mortgagee may,
at Mortgagee's election, use the award in any one or more of the following ways:
(a) apply any such award or payment (for purposes of this PARAGRAPH 6, the award
or payment that may be made in any condemnation or eminent domain proceeding
shall mean the entire award allocated to Mortgagor in any capacity) to the
discharge of the Indebtedness whether or not then due and payable (such
application to be without prepayment fee or premium, except that if an Event of
Default, or an event which with notice and/or the passage of time, or both,
would constitute an Event of Default, has occurred, then such application shall
be subject to the applicable premium computed in accordance with the Note), (b)
use the same or any part thereof to fulfill any of the covenants contained
herein as the Mortgagee may determine, (c) use the same or any part thereof to
replace or restore the Mortgaged Property to a condition satisfactory to the
Mortgagee, or (d) release the same to the Mortgagor. If the Mortgaged Property
is sold, through foreclosure or otherwise, prior to the receipt by Mortgagee of
such award or payment, Mortgagee shall have the right, whether or not a
deficiency judgment on the Note shall have been sought, recovered or denied, to
receive said award or payment or a portion thereof sufficient to pay the
Indebtedness.
7. LEASES AND RENTS.
(a) Mortgagor does hereby absolutely and unconditionally assign
to Mortgagee its right, title and interest in all current and future Leases and
Rents and all proceeds from the sale, cancellation, surrender or other
disposition of the Leases, it being intended by Mortgagor that this assignment
constitutes a present, absolute assignment and not an assignment for additional
security only. Such assignment to Mortgagee shall not be construed to bind
Mortgagee to the performance of any of the covenants, conditions or provisions
contained in any such Lease or otherwise to impose any obligation upon
Mortgagee. Mortgagor agrees to execute and deliver to Mortgagee such additional
instruments in form and substance satisfactory to Mortgagee, as may hereafter be
requested by Mortgagee to further evidence and confirm such assignment.
Nevertheless, subject to the terms of this PARAGRAPH 7, Mortgagee grants to
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Mortgagor a revocable license to operate and manage the Mortgaged Property and
to collect the Rents. Mortgagor shall hold the Rents, or a portion thereof
sufficient to discharge all current sums due on the Indebtedness, in trust for
the benefit of Mortgagee for use in the payment of such sums. The grant of the
foregoing license is subject to the provisions of PARAGRAPH 1 of the separate
Assignment of Leases and Rents of even date herewith granted by the Mortgagor as
"Assignor" to the Mortgagee as "Assignee" with respect to the Mortgaged Property
("ASSIGNMENT OF LEASES AND RENTS"). Upon the occurrence of an Event of Default,
the license granted to Mortgagor herein shall be automatically revoked and
Mortgagee shall immediately be entitled to possession of all Rents, whether or
not Mortgagee enters upon or takes control of the Mortgaged Property. Mortgagee
is hereby granted and assigned by Mortgagor the right, at its option, upon the
revocation of the license granted herein to enter upon the Mortgaged Property in
person, by agent or by court-appointed receiver to collect the Rents. Any Rents
collected after the revocation of the license herein granted may be applied
toward payment of the Indebtedness in such priority and proportion as Mortgagee
in its discretion shall deem proper. It is further the intent of Mortgagor and
Mortgagee that the Rents hereby absolutely assigned are no longer, during the
term of this Mortgage, property of Mortgagor or property of any estate of
Mortgagor as defined in Section 541 of the Bankruptcy Code and shall not
constitute collateral, cash or otherwise, of Mortgagor. The term "Rents" as used
herein shall mean the gross rents without deduction or offsets of any kind.
(b) All Leases executed after the date of this Mortgage shall
provide that they are subordinate to this Mortgage and that the lessee agrees to
attorn to Mortgagee; PROVIDED, HOWEVER, that nothing herein shall affect
Mortgagee's right to designate from time to time any one or more Leases as being
superior to this Mortgage and Mortgagor shall execute and deliver to Mortgagee
and shall cause to be executed and delivered to Mortgagee from each tenant under
such Lease any instrument or agreement as Mortgagee may deem necessary to make
such Lease superior to this Mortgage. Upon request, Mortgagor shall promptly
furnish Mortgagee with executed copies of all Leases.
(c) Mortgagor shall not, without the prior consent of Mortgagee,
(i) lease all or any part of the Mortgaged Property, (ii) alter or change the
terms of any Lease or cancel or terminate, abridge or otherwise modify the terms
of any Lease, (iii) consent to any assignment of or subletting under any Lease
not in accordance with its terms, (iv) cancel, terminate, abridge or otherwise
modify any guaranty of any Lease or the terms thereof, (v) collect or accept
prepayments of installments of Rents for a period of more than one (1) month in
advance or (vi) further assign the whole or any part of the Leases or the Rents;
PROVIDED, HOWEVER, that such action as described in subsections (i)-(iv) above
may be taken without Mortgagee's consent for any Lease which is for 10,000
square feet of space or less, and has a term (including the renewal or extension
term) of five (5) years or less, and so long as such Lease provides for an
annual rent at least equal to the then competitive and comparable market rent (a
lease satisfying those criteria shall be referred to as a "SMALL LEASE") so long
as the taking of such action is in the ordinary course of Mortgagor's business
and that such action is still subject to PARAGRAPH 1 of the separate Assignment
of Leases and Rents pertaining to Termination Amounts (as defined therein).
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(d) With respect to each Lease, Mortgagor shall (i) observe and
perform each and every provision thereof on the lessor's part to be fulfilled or
performed under each Lease and not do or permit to be done anything to impair
the value of the Lease as security for the Loan, including surrender or
voluntary termination of any Lease, (ii) promptly send to Mortgagee copies of
all notices of default which Mortgagor shall send or receive thereunder, (iii)
enforce all of the terms, covenants and conditions contained in such Lease upon
the lessee's part to be performed, short of termination thereof, (iv) execute
and deliver, at the request of Mortgagee, all such further assurances,
confirmations and assignments in connection with the Mortgaged Property as
Mortgagee shall, from time to time, require and (v) upon request, furnish
Mortgagee with executed copies of all Leases; PROVIDED, HOWEVER, the notice to
Mortgagee referenced in subsection (ii) above and the restriction on termination
of a Lease in connection with the enforcement of its terms, covenants and
conditions set forth in (iii) above shall not be required or apply, as the case
may be, for any Small Lease. Upon the occurrence of any Event of Default under
this Mortgage, Mortgagor shall pay monthly in advance to Mortgagee, or any
receiver appointed to collect the Rents, the fair and reasonable rental value
for the use and occupation of the Mortgaged Property or part of the Mortgaged
Property as may be occupied by Mortgagor or any one Mortgagor and upon default
in any such payment Mortgagor shall vacate and surrender possession of the
Mortgaged Property to Mortgagee or to such receiver and, in default thereof,
Mortgagor may be evicted by summary proceedings or otherwise.
(e) All security deposits of tenants, whether held in cash or
any other form, shall not be commingled with any other funds of Mortgagor and,
if cash, shall be deposited by Mortgagor at such commercial or savings bank or
banks as may be reasonably satisfactory to Mortgagee. Any bond or other
instrument which Mortgagor is permitted to hold in lieu of cash security
deposits under any applicable legal requirements shall be maintained in full
force and effect in the full amount of such deposits unless replaced by cash
deposits as hereinabove described, shall be issued by an institution reasonably
satisfactory to Mortgagee, shall, if permitted pursuant to any legal
requirements, name Mortgagee as payee or mortgagee thereunder (or at Mortgagee's
option, be fully assignable to Mortgagee) and shall, in all respects, comply
with any applicable legal requirements and otherwise be reasonably satisfactory
to Mortgagee. Mortgagor shall, upon request, provide Mortgagee with evidence
reasonably satisfactory to Mortgagee of Mortgagor's compliance with the
foregoing. Following the occurrence and during the continuance of any Event of
Default, Mortgagor shall, upon Mortgagee's request, if permitted by any
applicable legal requirements, turn over to Mortgagee the security deposits (and
any interest theretofore earned thereon) with respect to all or any portion of
the Mortgaged Property, to be held by Mortgagee subject to the terms of the
Leases.
8. MAINTENANCE AND USE OF MORTGAGED PROPERTY. Mortgagor shall or
shall cause tenants to, at its sole cost and expense, keep and maintain the
Mortgaged Property, including, without limitation, parking lots and recreational
and landscaped portions thereof, if any, in good order and condition. The
Improvements and the Equipment shall not be diminished, removed, demolished or
materially altered (except for normal replacement of Equipment) and Mortgagor
shall not erect any new buildings, structures or building additions on the
Mortgaged Property without the prior consent of Mortgagee, So long as no Event
of Default shall have occurred and be continuing, Mortgagor shall have the right
at any time and from time to time after providing Mortgagee with written notice
to make or cause to be made reasonable alterations
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of and additions to the Mortgaged Property or any part thereof, PROVIDED that
any alteration or addition (i) shall not change the general character of the
Mortgaged Property or reduce the fair market value thereof below its value
immediately before such alteration or addition, or impair the usefulness of the
Mortgaged Property, (ii) is effected with due diligence, in a good and
workmanlike manner and in compliance with all applicable laws and with all
provisions of any insurance policy covering or applicable to the Mortgaged
Property and all requirements of the issuers thereof, (iii) is promptly and
fully paid for, or caused to be paid for, by Mortgagor, (iv) the estimated cost
of such alteration or addition does not exceed five percent (5%) of the original
principal amount of the Loan, (v) is made under the supervision of a qualified
architect or engineer, (vi) shall not violate the terms of any Leases, and (vii)
upon completion, Mortgagor shall provide Mortgagee with (aa) a satisfactory
final improvement survey if the footprint of the building has been altered,
(bb), any final occupancy permit which may be required for the Improvements,
(cc) all other governmental permits, certificates and approvals and all other
permits, certificates and approvals of fire underwriters which are required with
respect to the alterations and additions and the use and occupancy thereof, and
shall furnish true copies thereof to Mortgagee, and (dd) final lien waivers from
all contractors, subcontractors and materialmen. Mortgagor shall promptly comply
with all laws, orders and ordinances affecting the Mortgaged Property, or the
use thereof, PROVIDED, HOWEVER, that nothing in the foregoing clause shall
require Mortgagor to comply with any such law, order or ordinance so long as
Mortgagor shall in good faith, after notice to, but without cost or expense to,
Mortgagee, contest the validity of such law, order or ordinance by appropriate
legal proceedings and in accordance with all applicable law, which proceedings
must operate to prevent (i) the enforcement thereof, (ii) the payment of any
fine, charge or penalty, (iii) the sale or forfeiture of the Mortgaged Property
or any part thereof, (iv) the lien of this Mortgage and the priority thereof
from being impaired, (v) the imposition of criminal liability on Mortgagee and
(vi) the imposition, unless stayed, of civil liability on Mortgagee; PROVIDED
that during such contest Mortgagor shall, at the option of Mortgagee, provide
cash, bonds or other security satisfactory to Mortgagee, indemnifying and
protecting Mortgagee against any liability, loss or injury by reason of such
non-compliance or contest, and PROVIDED FURTHER, that such contest shall be
promptly and diligently prosecuted by and at the expense of Mortgagor. Mortgagor
shall promptly, at its sole cost and expense, repair, replace or rebuild any
part of the Mortgaged Property which may be destroyed by any casualty, or become
damaged, worn or dilapidated. Mortgagor shall not commit any waste at the
Mortgaged Property. Mortgagor shall not initiate, join in, acquiesce in or
consent to any material adverse change in any private restrictive covenant,
zoning law or other public or private restriction, limiting or defining the uses
which may be made of the Mortgaged Property or any part thereof. If under
applicable zoning provisions the use of all or any portion of the Mortgaged
Property is or shall become a nonconforming use, Mortgagor will not cause or
permit such nonconforming use to be discontinued or abandoned without the
express consent of Mortgagee. Mortgagor covenants and agrees that it shall
operate the Mortgaged Property at all times as a first-class commercial retail
facility.
9. TRANSFER OR ENCUMBRANCE OF THE MORTGAGED PROPERTY OR INTERESTS IN
THE MORTGAGOR; OTHER INDEBTEDNESS.
(a) Mortgagor acknowledges that Mortgagee has examined and
relied on the creditworthiness and experience of Mortgagor in owning and
operating properties such as
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the Mortgaged Property in agreeing to make the Loan, and that Mortgagee will
continue to rely on Mortgagor's ownership of the Mortgaged Property as a means
of maintaining the value of the Mortgaged Property as security for repayment of
the Indebtedness. Mortgagor acknowledges that Mortgagee has a valid interest in
maintaining the value of the Mortgaged Property so as to ensure that, should
Mortgagor default in the repayment of the Indebtedness, Mortgagee can recover
the Indebtedness by a sale of the Mortgaged Property. Mortgagor shall not,
without the prior written consent of Mortgagee, sell, convey, alienate,
mortgage, encumber, pledge or otherwise transfer the Mortgaged Property or any
part thereof or interest therein, or permit the Mortgaged Property or any part
thereof to be sold, conveyed, alienated, mortgaged, encumbered, pledged or
otherwise transferred.
(b) A sale, conveyance, alienation, mortgage, encumbrance,
pledge or transfer within the meaning of this PARAGRAPH 9 shall be deemed to
include (i) an installment sales agreement wherein Mortgagor agrees to sell the
Mortgaged Property or any part thereof for a price to be paid in installments,
(ii) an agreement by Mortgagor leasing all or a substantial part of the
Mortgaged Property for other than actual occupancy by a space tenant thereunder
or a sale, assignment or other transfer of, or the grant of a security interest
in, Mortgagor's right, title and interest in and to any Leases or any Rents,
(iii) if Mortgagor, any guarantor of Non-Recourse Carveout Obligations (as
hereinafter defined), any other guarantor, any indemnitor of environmental
liabilities or any general partner or managing member of Mortgagor or of any
such guarantor or indemnitor is a corporation, the voluntary or involuntary
sale, assignment, conveyance or transfer of such corporation's stock (or the
stock of any corporation directly or indirectly controlling such corporation by
operation of law or otherwise) or the creation or issuance of new stock in one
or a series of transactions by which an aggregate of more than ten percent (10%)
of such corporation's stock shall be vested in a party or parties who are not
now stockholders or any change in the control of such corporation, (iv) if
Mortgagor, any guarantor, of Non-Recourse Carveout Obligations, any other
guarantor or any indemnitor of environmental liabilities or any general partner
or managing member of Mortgagor or any such guarantor or indemnitor is a limited
or general partnership, joint venture or limited liability company, the change,
removal, resignation or addition of a general partner, managing partner, limited
partner, joint venturer or member or the transfer of the partnership interest of
any general partner, managing partner or limited partner or the transfer of the
interest of any joint venturer or member, and (v) if Mortgagor, any guarantor of
Non-Recourse Carveout Obligations or any other guarantor or any indemnitor of
environmental liabilities, is an entity, whether one of the above-mentioned
entities or not, any change in the ownership or control of such entity, any
merger, consolidation or dissolution or syndication affecting such entity, or
the transfer, sale, assignment or pledge of any interest in such entity or in
any person, directly or indirectly, controlling such entity or in any general
partner or managing member thereof, whether at one time or in a series of
related transactions.
(c) Mortgagee shall not be required to demonstrate any actual
impairment of its security or any increased risk of default hereunder in order
to declare the Indebtedness immediately due and payable upon Mortgagor's sale,
conveyance, alienation, mortgage, encumbrance, pledge or transfer of the
Mortgaged Property without Mortgagee's consent. This provision shall apply to
every sale, conveyance, alienation, mortgage, encumbrance, pledge or transfer of
the Mortgaged Property regardless of whether voluntary or
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not, or whether or not Mortgagee has consented to any previous sale, conveyance,
alienation, mortgage, encumbrance, pledge or transfer of the Mortgaged Property.
(d) Mortgagee's consent to a sale, conveyance, alienation,
mortgage, encumbrance, pledge or transfer of the Mortgaged Property or any other
action described in this PARAGRAPH 9 shall not be deemed to be a waiver of
Mortgagee's right to require such consent to any future occurrence of same. Any
sale, conveyance, alienation, mortgage, encumbrance, pledge or transfer of the
Mortgaged Property or other action made in contravention of this PARAGRAPH 9
shall be null and void and of no force and effect.
(e) Mortgagor agrees to bear and shall pay or reimburse
Mortgagee on demand for all reasonable expenses (including, without limitation,
reasonable attorneys' fees and disbursements, title search costs and title
insurance endorsement premiums) incurred by Mortgagee in connection with the
review, approval and documentation of any such sale, conveyance, alienation,
mortgage, encumbrance, pledge or transfer.
(f) Notwithstanding the foregoing, from and after the
ninetieth (90th) day following satisfaction by Mortgagor of the Transfer
Conditions described in Paragraph 72 below, Mortgagee shall permit two (2) sales
or transfers of the Mortgaged Property, PROVIDED that:
(i) no Event of Default or event which with the giving of
notice or passage of time would constitute an Event of Default shall have
occurred and remain uncured;
(ii) the proposed transferee ("TRANSFEREE"), the guarantors of
Non-Recourse Carveout Obligations, any other guarantor, and the indemnitors
of environmental liabilities shall be reputable entities or persons of good
character, creditworthy, with sufficient financial worth considering the
obligations assumed and undertaken, as evidenced by financial statements
and other information reasonably requested by Mortgagee;
(iii) the Transferee and its property manager shall have
sufficient experience in the ownership and management of properties similar
to the Mortgaged Property, and Mortgagee shall be provided with reasonable
evidence thereof (and Mortgagee reserves the right to approve the
Transferee without approving the substitution of the property manager);
(iv) that Mortgagee has received a written request for approval
from the Mortgagor at least thirty (30) days prior to the proposed transfer
(including a description of the proposed terms of the transfer), together
with a diagram showing the legal structure of the Transferee, the proposed
guarantors of Non-Recourse Carveout Obligations, any other proposed
guarantors, and the proposed indemnitors of environmental liabilities and
all of the constituent entities of each, after the contemplated transfer,
and a list of the names, types of interests and ownership percentages of
all persons to have ownership interests in any of the foregoing or any
constituent entity thereof, financial statements for all such entities and
an administrative fee of $5,000,
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which shall be deemed fully earned on the date of receipt and shall be
retained by Mortgagee regardless of whether or not the transfer occurs and
whether or not approval is given;
(v) Mortgagee and its counsel have received (aa) certification
from Mortgagor and the Transferee that the proposed terms of the transfer
described in subparagraph 9(f)(iv) are the actual terms of the transfer,
(bb) evidence of casualty insurance and other applicable insurance, (cc)
all corporate, partnership or other entity documents and (dd) all other
certificates, legal opinions, title materials and other documents which
Mortgagee may require, all in form and substance satisfactory to Mortgagee,
at least thirty (30) days prior to the proposed transfer;
(vi) Mortgagee be provided satisfactory evidence concerning the
effect of any change in the real estate taxes to result from the sale and
the effect of such change on the ability of the Mortgaged Property to
generate a cash flow sufficient to pay the debt service on the Loan and to
maintain a debt service coverage ratio satisfactory to Mortgagee;
(vii) If the Loan is part of a Secondary Market Transaction and
the documents governing such Secondary Market Transaction so require,
Mortgagee shall have received in writing evidence from the Rating Agencies
to the effect that such transfer will not result in a re-qualification,
reduction or withdrawal of any rating initially assigned or to be assigned
in a Secondary Market Transaction together with such legal opinions as may
be requested by the Rating Agencies. The term "RATING AGENCIES" as used
herein shall mean each of Standard & Poor's Ratings Group, ▇▇▇▇▇'▇
Investors Service, Inc., Duff & ▇▇▇▇▇▇ Credit Rating Co., Fitch Investors
Service, Inc. or any other nationally-recognized statistical rating agency
who shall then be rating the certificates or securities issued in
connection with the Secondary Market Transaction;
(viii) the Transferee and its constituent entities shall comply
with all of the Single Purpose Entity/Separateness requirements set forth
in Paragraph 19 hereof;
(ix) the Transferee shall have executed and delivered to
Mortgagee an assumption agreement in form and substance acceptable to
Mortgagee, evidencing such Transferee's agreement to abide and be bound by
the terms of the Note, this Mortgage and the other Loan Documents, together
with an executed guaranty of Non-Recourse Carveout Obligations and any
other guaranty from an approved guarantor and an executed separate
environmental indemnity agreement from an approved indemnitor, both in form
and substance acceptable to Mortgagee, other documentation as Mortgagee may
reasonably require, and such legal opinions and title insurance
endorsements as may be reasonably requested by Mortgagee;
(x) Mortgagee shall have received an assumption fee equal to
one percent (1%) of the then unpaid principal balance of the Note (against
which the administrative fee shall be credited) in addition to the payment
of all reasonable costs and expenses incurred by Mortgagee in connection
with such assumption (including reasonable attorney's fees and costs); and
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(xi) the Transferee shall be able to make the representations
and warranties set forth in Paragraph 18(h) of this Mortgage.
In the event all of the foregoing conditions are satisfied and
Mortgagee consents to the sale or transfer, Mortgagee agrees to release
Mortgagor, any indemnitors under any environmental indemnity and any guarantors
of the Non-Recourse Carveout Obligations of all liability under the Loan
Documents upon such transfer of the Morgaged Property pursuant to this
Paragraph 9(f), (1) except for any event or circumstance with respect to which
Mortgagor and such indemnitors remain obligated to continue to indemnify
Mortgagee under any environmental indemnity agreement; (2) except for any fraud
or willful misrepresentation by or on behalf of Mortgagor, or such indemnitor or
guarantor with respect to the Mortgaged Property or the making or delivery of
any of the Loan Documents or with respect to any materials or information
provided by or on behalf of Mortgagor, indemnitor or guarantor in connection
with the Loan, and (3) provided that Mortgagor's obligations arising prior to
completion of such transfer are no longer subject to disgorgement under any
applicable state or federal creditor rights or bankruptcy laws and Mortgagee
receives an assumption of the obligations of such indemnitor and guarantor by an
individual(s) or entity(ies) acceptable to Mortgagee in its sole discretion.
Mortgagor and Mortgagee further agree that (1) any environmental
indemnification obligations of Mortgagor or any indemnitor under an
environmental indemnity agreement shall not apply to any future environmental
activity or conditions resulting solely from any act or omission for which
Mortgagor bears no responsibility and which occurs after Mortgagor or any person
or entity in any way related to Mortgagor no longer holds possession or has any
interest in the Mortgaged Property; provided, however, the transferor Mortgagor,
the prior guarantors and the prior indemnitors, respectively, shall have the
burden of establishing that all the conditions in this PARAGRAPH 9 (including,
without limitation, the time as to which matters described herein arose) were
satisfied by clear and convincing evidence and shall indemnify and hold
Mortgagee harmless for all matters set forth in PARAGRAPH 39 and in the
Non-Recourse Carveout Obligations until such transferor Mortgagor, prior
guarantors or prior indemnitors, respectively, have met such burden; Mortgagee
agrees that Mortgagor shall have met such burden with respect to the Mortgaged
Property if Mortgagor at such time delivers to Mortgagee an environmental
insurance policy satisfactory in all respects to Mortgagee in its reasonable
discretion; and (2) in the event the individual or entity(ies) assuming the
obligations of such indemnitor and guarantor are acceptable to Mortgagee in its
sole discretion, are willing to accept such indemnitor's obligation under the
environmental indemnity for the time period in which the original indemnitor
guaranteed the obligations of Mortgagor (i.e. the time period prior to said
transfer of the Mortgaged Property) and are willing to execute an indemnity in
form and content acceptable to Mortgagee, then, notwithstanding the foregoing,
such original indemnitor will be completely relieved of liability under such
environmental indemnity (except for any fraud or willful misrepresentation by or
on behalf of Mortgagor or such indemnitor or guarantor with respect to the
Mortgaged Property, the making or delivery of any of the Loan Documents or in
any materials or information provided by or on behalf of such indemnitor in
connection with the Loan).
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(g) The provisions of Paragraphs 9(a), 9(b) and 9(f) shall
not operate to prohibit the transfer, sale or conveyance of shares in Inland
Western Retail Real Estate Trust, Inc. (the "Trust") as long as all of the
following conditions are satisfied:
(i) the Trust continues to be the sole member and owner of
Mortgagor and continues to control the day-to-day operations of Mortgagor
and the Mortgaged Property;
(ii) the Trust maintains its status as a real estate
investment trust; and
(iii) no such transfer results in any party owning more than
twenty percent (20%) (or such lesser amount as constitutes a controlling
interest) in the shares or ownership units or interests of the Trust.
The term CONTROL or CONTROLLING shall mean the possession,
directly or indirectly, of the power to direct or cause the direction of
management, policies or activities of a person or entity, whether through
ownership of voting securities or other interests, by contract or
otherwise.
(h) Notwithstanding anything in this Paragraph 9 to the
contrary, from and after the ninetieth (90th) day following satisfaction by
Mortgagor of the Transfer Conditions described in Paragraph 72 below, Mortgagor
shall have a one time right, provided no Event of Default or event which with
the giving of notice or passage of time would constitute an Event of Default
under the Loan Documents shall have occurred and remain uncured, to assign, sell
or transfer (the "Permitted Affiliated Transfer") all of the Mortgaged Property
to an affiliate of Inland Western Retail Real Estate Trust, Inc. ("Permitted
Affiliated Transferee"), PROVIDED that:
(i) Mortgagor shall pay to Mortgagee a $5,000.00 transfer fee;
(ii) Mortgagee shall have received from Mortgagor reimbursement
of all of Mortgagee's expenses, including legal fees, incurred in
connection with the Permitted Affiliated Transfer;
(iii) the Permitted Affiliated Transferee shall assume, in form
and substance satisfactory to Mortgagee, all obligations of Mortgagor under
the Loan Documents, including, without limitation, the environmental
Indemnity Agreement and Guaranty of non-recourse carveout obligations, with
the same degree of recourse liability as Mortgagor and subject to the same
exculpatory provisions;
(iv) Mortgagee shall have received a title policy satisfactory to
Mortgagee updated to the date of the Permitted Affiliated Transfer,
evidencing that such Permitted Affiliated Transfer will not adversely
affect Mortgagee's first and prior lien on the Mortgaged Property or any
other rights or interests granted to Mortgagee under the Loan Documents;
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Loan No. 6518291
(v) Mortgagee shall have received legal opinions of
Mortgagor's independent or in-house counsel, as the case may be, in form
and substance satisfactory to Mortgagee, that all previous opinions
pertaining to Mortgagor are true with respect to the Permitted Affiliated
Transferee and the Permitted Affiliated Transferee has duly assumed the
Loan Documents, and the same are valid and enforceable against the
Permitted Affiliated Transferee and the Mortgaged Property and that
Mortgagor has the requisite power and authority to properly transfer the
Mortgaged Property;
(vi) no Event of Default shall have occurred and remain uncured
under the Loan Documents;
(vii) no such transfer of interest shall result in a change of
control of Mortgagor or the day-to-day operations of the Mortgaged
Property;
(viii) without limiting the foregoing, no such transfer, either
singly or in the aggregate with other transfers, will result in a violation
of the special purpose entity provisions of the Loan Documents or
Mortgagor's organizational documents and Mortgagor will provide new or
updated non-consolidation opinions and other opinions to the extent
required at the initial funding of the Loan with respect to the Permitted
Affiliated Transfer; and
(ix) Mortgagee has received at least thirty (30) days' prior
written notice of such transfer, together with a diagram showing the
structure of the Mortgagor and all constituent entities after the
contemplated transfer and a list of the names, types of interests and
percentages of ownership of all owners of interests in Mortgagor and any
constituent entities (except the shareholders of Inland Western Retail Real
Estate Trust, Inc.) after the contemplated transfer.
(i) Mortgagor has not incurred and will not incur any
indebtedness, secured or unsecured, other than the Loan and debt (i) incurred in
the ordinary course of business to vendors and suppliers of services to the
Mortgaged Property, (ii) not secured by the Mortgaged Property, or any portion
thereof, or by interests in the Mortgagor or any constituent entity thereof, and
(iii) not accompanied by any rights to control or to obtain control of the
Mortgagor or any constituent entity thereof. No indebtedness other than the Loan
may be secured (subordinate or PARI PASSU) by the Mortgaged Property, or any
portion thereof, or by interests in the Mortgagor or any constituent entity
thereof.
10. ESTOPPEL CERTIFICATES.
(a) Mortgagor, within ten (10) business days after request by
Mortgagee, shall furnish Mortgagee from time to time with a statement, duly
acknowledged and certified, setting forth (i) the amount of the original
principal amount of the Note, (ii) the unpaid principal amount of the Note,
(iii) the rate of interest in the Note, (iv) the date through which all
installments of interest, commitment fees and/or principal have been paid, (v)
any offsets or defenses to the payment of the Indebtedness, if any, (vi) that
the Note and this Mortgage have not been modified or if modified, giving
particulars of such modification and (vii) such other information as shall be
requested by Mortgagee.
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Loan No. 6518291
(b) Mortgagor, after request by Mortgagee, will use commercially
reasonable efforts to obtain and furnish (within the time periods, if any,
provided in the applicable Leases or if no time period is so specified, within
ten (10) business days after request) Mortgagee from time to time with estoppel
certificates from any tenants under then existing Leases, which certificates
shall be in form and substance as required by such Leases, or if not required,
then in form and substance reasonably satisfactory to Mortgagee.
11. NO COOPERATIVE OR CONDOMINIUM. Mortgagor represents and warrants
that the Mortgaged Property has not been subjected to a cooperative or
condominium form of ownership. Mortgagor hereby covenants and agrees that it
will not file a declaration of condominium, map or any other document having the
effect of subjecting the Mortgaged Property, to a condominium or cooperative
form of ownership.
12. CHANGES IN THE LAWS REGARDING TAXATION. If any law is enacted or
adopted or amended after the date of this Mortgage which deducts the
Indebtedness or any portion thereof from the value of the Mortgaged Property for
the purpose of taxation or which imposes a tax, either directly or indirectly,
on the principal amount of the Note or Mortgagee's interest in the Mortgaged
Property, Mortgagor will pay such tax, with interest and penalties thereon, if
any. In the event Mortgagee is advised by counsel chosen by it that the payment
of such tax or interest and penalties by Mortgagor would be unlawful or taxable
to Mortgagee or unenforceable or provide the basis for a defense of usury, then
in any such event, Mortgagee shall have the option, by notice of not less than
sixty (60) days, to declare the Indebtedness immediately due and payable without
prepayment fee or premium, except that if an Event of Default, or an event which
with notice and/or the passage of time, or both, would constitute an Event of
Default, has occurred, the applicable premium computed in accordance with the
Note shall apply.
13. NO CREDITS ON ACCOUNT OF THE INDEBTEDNESS. Mortgagor will not
claim or demand or be entitled to any credit or credits on account of the
Indebtedness for any part of the Taxes assessed against the Mortgaged Property
or any part thereof and no deduction shall otherwise be made or claimed from the
taxable value of the Mortgaged Property, or any part thereof, by reason of this
Mortgage or the Indebtedness. In the event such claim, credit or deduction shall
be required by law, Mortgagee shall have the option, by notice of not less than
sixty (60) days, to declare the Indebtedness immediately due and payable without
prepayment fee or premium, except that if an Event of Default, or an event which
with notice and/or the passage of time, or both, would constitute an Event of
Default, has occurred, the applicable premium computed in accordance with the
Note shall apply.
14. DOCUMENTARY STAMPS. If at any time the United States of America,
any State thereof or any subdivision of any such State shall require revenue or
other stamps to be affixed to the Note or this Mortgage, or impose any other tax
or charge on the same, Mortgagor will pay for the same, with interest and
penalties thereon, if any.
15. RIGHT OF ENTRY. Mortgagee and its agents shall have the right to
enter and inspect the Mortgaged Property at any time during reasonable business
hours upon twenty-four
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Loan No. 6518291
(24) hour notice to Mortgagor, except in the case of an emergency, in which
event Mortgagee and its agents may enter and inspect the Mortgaged Property at
any time.
16. BOOKS AND RECORDS.
(a) Mortgagor will maintain full, accurate and complete books of
accounts and other records reflecting the results of the operations of the
Mortgaged Property as well as its other operations and will furnish, or cause to
be furnished, to Mortgagee the following:
(i) within ninety (90) days after the end of each fiscal year,
the Mortgagor will furnish to Mortgagee, a statement of Mortgagor's
financial condition, including a balance sheet with respect to Mortgagor,
and a statement of annual income and expenses satisfactory in form and
substance to Mortgagee in connection with the operation of the Mortgaged
Property, in detail satisfactory to Mortgagee, prepared by, audited and
certified by a certified public accountant who is a member of the American
Institute of Certified Public Accountants, provided however that so long as
there in then no Event of Default hereunder, such statement may be prepared
and certified by Mortgagor, Mortgagor's accountant or a financial officer
of Mortgagor if such certified statement by a certified public accountant
is not available, and, in addition, within forty-five (45) days after the
end of each fiscal quarter of Mortgagor, Mortgagor shall provide the above
information except that it may be prepared and certified by the financial
officer of Mortgagor who is responsible for the preparation of such annual
financial statements.
(ii) accompanying the submission of the certified statements of
annual and quarterly income and expenses, when the Mortgaged Property is
office, retail or multi-tenant industrial property, shall be a certified
current rent roll in a form previously approved by Mortgagee, which shall
include, among other things, tenant names, lease commencement and
expiration dates, square footage and annual rent.
(b) Mortgagee shall have the right, upon five (5) days' prior
notice to Mortgagor, to inspect and make copies of Mortgagor's books and records
and income tax returns and notices.
(c) In the event of a Secondary Market Transaction, Mortgagor
shall furnish from time to time such information relating to Mortgagor and the
Mortgaged Property as shall be reasonably requested by the Rating Agencies at no
cost to Mortgagor.
17. PERFORMANCE OF OTHER AGREEMENTS. Mortgagor shall observe and
perform each and every term to be observed or performed by such Mortgagor
pursuant to the terms of any agreement or recorded instrument affecting or
pertaining to the Mortgaged Property.
18. REPRESENTATIONS AND COVENANTS CONCERNING LOAN. Mortgagor
represents, warrants and covenants as follows:
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Loan No. 6518291
(a) The Note, this Mortgage and the other Loan Documents are not
subject to any right of rescission, set-off, counterclaim or defense, including
the defense of usury, nor would the operation of any of the terms of the Note,
this Mortgage and the other Loan Documents, or the exercise of any right
thereunder, render this Mortgage unenforceable, in whole or in part, or subject
to any right of rescission, set-off, counterclaim or defense, including the
defense of usury.
(b) To Mortgagor's best knowledge, all certifications, permits,
licenses and approvals, including, without limitation, certificates of
completion and occupancy permits required for the legal use, occupancy of the
Mortgaged Property, have been obtained and are in full force and effect. The
Mortgaged Property is free of material damage and is in good repair, and there
is no proceeding pending for the total or partial condemnation of, or affecting,
the Mortgaged Property.
(c) To Mortgagor's best knowledge, all of the Improvements which
were included in determining the appraised value of the Mortgaged Property lie
wholly within the boundaries and building restriction lines of the Mortgaged
Property, and no improvements on adjoining properties encroach upon the
Mortgaged Property, and no easements or other encumbrances upon the Land
encroach upon any of the Improvements, so as to affect the value or
marketability of the Mortgaged Property except those which are insured against
by title insurance. All of the Improvements comply with all requirements of
applicable zoning and subdivision laws and ordinances in all material respects.
(d) The Mortgaged Property is not subject to any Leases other
than the Leases described in the rent roll delivered to Mortgagee in connection
with this Mortgage. No person has any possessory interest in the Mortgaged
Property or right to occupy the same except under and pursuant to the provisions
of the Leases. Except as otherwise disclosed in writing to Mortgagee, to
Mortgagor's best knowledge the current Leases are in full force and effect and
there are no defaults thereunder by either party and there are no conditions
that, with the passage of time or the giving of notice, or both, would
constitute defaults thereunder. Except as otherwise disclosed in writing to
Mortgagee, all presently existing Leases are subordinate to this Mortgage.
(e) To Mortgagor's best knowledge, the Mortgaged Property and
the Leases are in compliance with all statutes, ordinances, regulations and
other governmental or quasi-governmental requirements and private covenants now
or hereafter relating to the ownership, construction, use or operation of the
Mortgaged Property.
(f) To Mortgagor's best knowledge there has not been and shall
never be committed by Mortgagor any act or omission affording the federal
government or any state or local government the right of forfeiture as against
the Mortgaged Property or any part thereof or any monies paid in performance of
Mortgagor's obligations under any of the Loan Documents. Mortgagor hereby
covenants and agrees not to commit, permit or suffer to exist any act or
omission affording such right of forfeiture.
(g) The Management Agreement (the "MANAGEMENT AGREEMENT")
between Mortgagor and Inland Northwest Management Corp. ("MANAGER") pursuant to
which
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Loan No. 6518291
Manager operates the Mortgaged Property (a true, correct and complete copy of
which has been delivered to Mortgagee) is in full force and effect and there is
no default or violation by any party thereunder. The fee due under the
Management Agreement, and the terms and provisions of the Management Agreement,
are subordinate to this Mortgage and the Manager shall attorn to Mortgagee.
Mortgagor shall not terminate, cancel, modify, renew or extend the Management
Agreement, or enter into any agreement relating to the management or operation
of the Mortgaged Property with Manager or any other party without the express
written consent of Mortgagee, which consent shall not be unreasonably withheld.
If at any time Mortgagee consents to the appointment of a new manager, such new
manager and Mortgagor shall, as a condition of Mortgagee's consent, execute a
Manager's Consent and Subordination of Management Agreement in the form then
used by Mortgagee.
(h) IMPROPER FINANCIAL TRANSACTIONS.
(i) Mortgagor is, and shall remain at all times, in full
compliance with all applicable laws and regulations of the United States of
America that prohibit, regulate or restrict financial transactions, and any
amendments or successors thereto and any applicable regulations promulgated
thereunder (collectively, the "FINANCIAL CONTROL LAWS"), including but not
limited to those related to money laundering offenses and related
compliance and reporting requirements (including any money laundering
offenses prohibited under the Money Laundering Control Act, 18 U.S.C.
Sections 1956, 1957 and the Bank Secrecy Act, 31 U.S.C. Sections 5311 ET
SEQ.) and the Foreign Assets Control Regulations, 31 C.F.R. Section 500 ET
SEQ.
(ii) Mortgagor represents and warrants that: (i) Mortgagor is
not a Barred Person (hereinafter defined); (ii) Mortgagor is not owned or
controlled, directly or indirectly, by any Barred Person; and (iii)
Mortgagor is not acting, directly or indirectly, for or on behalf of any
Barred Person.
(iii) Mortgagor represents and warrants that it understands and
has been advised by legal counsel on the requirements of the Financial
Control Laws.
(iv) Under any provision of this Mortgage or any of the other
Loan Documents where the Mortgagee shall have the right to approve or
consent to any particular action, including without limitation any (i)
sale, transfer, assignment of the Mortgaged Property or of any direct or
indirect ownership interest in Mortgagor, (ii) leasing of the Mortgaged
Property, or any portion thereof, or (iii) incurring of additional
financing secured by Mortgaged Property, or any portion thereof or by any
direct of indirect ownership interest in the Mortgagor, Mortgagee shall
have the right to withhold such approval or consent, in its sole
discretion, if the granting of such approval or consent could be construed
as a violation of any of the Financial Control Laws.
(v) Mortgagor covenants and agrees that it will upon request
provide Mortgagee with (or cooperate with Mortgagee in obtaining)
information required by Mortgagee for purposes of complying with any
Financial Control Laws.
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As used in this Mortgage, the term "BARRED PERSON" shall mean
(i) any person, group or entity named as a "Specially Designated National and
Blocked Person" or as a person who commits, threatens to commit, supports, or is
associated with terrorism as designated by the United States Department of the
Treasury's Office of Foreign Assets Control ("OFAC"), (ii) any person, group or
entity named in the lists maintained by the United Stated Department of Commerce
(Denied Persons and Entities), (iii) any government or citizen of any country
that is subject to a United States Embargo identified in regulations promulgated
by OFAC and (iv) any person, group or entity named as a denied or blocked person
or terrorist in any other list maintained by any agency of the United States
government.
19. SINGLE PURPOSE ENTITY/SEPARATENESS. Mortgagor represents,
warrants and covenants as follows:
(a) The purpose for which the Mortgagor is organized shall be
limited solely to (A) owning, holding, selling, leasing, transferring,
exchanging, operating and managing the Mortgaged Property, (B) entering into the
Loan with the Mortgagee, (C) refinancing the Mortgaged Property in connection
with a permitted repayment of the Loan, and (D) transacting any and all lawful
business for which a Mortgagor may be organized under its constitutive law that
is incident, necessary and appropriate to accomplish the foregoing.
(b) Mortgagor does not own and will not own any asset or
property other than (i) the Mortgaged Property, and (ii) incidental personal
property necessary for and used in connection with the ownership or operation of
the Mortgaged Property.
(c) Mortgagor will not engage in any business other than the
ownership, management and operation of the Mortgaged Property.
(d) Mortgagor will not enter into any contract or agreement with
any affiliate of Mortgagor, any constituent party of Mortgagor, any owner of the
Mortgagor, the Guarantors (as hereinafter defined) or any affiliate of any
constituent party or Guarantor, except upon terms and conditions that are
intrinsically fair, commercially reasonable and substantially similar to those
that would be available on an arms-length basis with third parties not
affiliated with the Mortgagor or any constituent party of Mortgagor or any owner
of Mortgagor.
(e) Mortgagor has not incurred and will not incur any
indebtedness, secured or unsecured, other than the Loan and debt (i) incurred in
the ordinary course of business to vendors and suppliers of services to the
Mortgaged Property, (ii) not secured by the Mortgaged Property, or any portion
thereof, or by interests in the Mortgagor or any constituent entity thereof, and
(iii) not accompanied by any rights to control or to obtain control of the
Mortgagor or any constituent entity thereof. No indebtedness other than the Loan
may be secured (subordinate or PARI PASSU) by the Mortgaged Property, or any
portion thereof, or by interests in the Mortgagor or any constituent entity
thereof.
(f) Mortgagor has not made and will not make any loans or
advances to any entity or person (including any affiliate or any constituent
party of Mortgagor or any owner of Mortgagor, any Guarantor or any affiliate of
any constituent party or Guarantor), and shall not acquire obligations or
securities of its affiliates or any constituent party.
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(g) Mortgagor is and will remain solvent and Mortgagor will pay
its debts and liabilities (including, as applicable, shared personnel and
overhead expenses) from its assets as the same shall become due.
(h) Mortgagor has done or caused to be done and will do all
things necessary to observe organizational formalities and preserve its
existence, and Mortgagor will not, nor will Mortgagor permit any constituent
party of Mortgagor or any owner of Mortgagor or any Guarantor to amend, modify
or otherwise change the partnership certificate, partnership agreement, articles
of incorporation and bylaws, operating agreement, trust or other organizational
documents of Mortgagor or such constituent party or Guarantor without the
written consent of Mortgagee.
(i) Mortgagor will maintain all of its books, records and
financial statements separate from those of its affiliates and any constituent
party. Mortgagor's assets will not be listed as assets on the financial
statement of any other entity except the ownership interests in Mortgagor may be
listed as assets on the financial statements of the Trust. Mortgagor shall have
its own separate financial statement, provided, however, that Mortgagor's assets
may be included in a consolidated financial statement of its parent companies if
inclusion on such a consolidated statement is required to comply with the
requirements of generally accepted accounting principles ("GAAP"), provided that
such consolidated financial statement shall contain a footnote to the effect
that Mortgagor's assets are owned by Mortgagor and that they are being included
on the financial statement of its parent solely to comply with the requirements
of GAAP, and further provided that such assets shall be listed on Mortgagor's
own separate balance sheet. Mortgagor will file its own tax returns if required
by law and will not file a consolidated federal income tax return with any other
corporation except the Trust in which case Mortgagor will be shown on a separate
schedule of such return as a separate member of the consolidated group with its
delineated financial information. Mortgagor shall maintain its books, records,
resolutions and agreements as official records.
(j) Mortgagor will be, and at all times will hold itself out to
the public as, a legal entity separate and distinct from any other entity
(including any affiliate of Mortgagor, any constituent party of Mortgagor, any
Guarantor or any affiliate of any constituent party or Guarantor), shall correct
any known misunderstanding regarding its status as a separate entity, shall
conduct business in its own name, shall not identify itself or any of its
affiliates as a division or part of the other except the Trust and shall
maintain and utilize separate telephone numbers, stationery, invoices and
checks.
(k) Mortgagor will maintain adequate capital for the normal
obligations reasonably foreseeable in a business of its size and character and
in light of its contemplated business operations.
(l) Neither Mortgagor nor any constituent party will seek the
dissolution, winding up, liquidation, consolidation or merger, in whole or in
part, or the sale of material assets of Mortgagor.
(m) Mortgagor will not commingle the funds and other assets of
Mortgagor with those of any affiliate or any constituent party of Mortgagor or
any owner of
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Mortgagor, any Guarantor, or any affiliate of any constituent party or
Guarantor, or any other person, except for the Manager, and will not participate
in a cash management system with any such party.
(n) Mortgagor will not commingle its assets with those of any
other person or entity except the Manager and will hold all of its assets in its
own name or in its agent's name.
(o) Mortgagor will not guarantee or become obligated for the
debts of any other entity or person and does not and will not hold itself out as
being responsible for the debts or obligations of any other person.
(p) If Mortgagor is a limited partnership or a limited liability
company, at least one general partner or member (an "SPC PARTY") shall be a
corporation whose sole asset is its interest in Mortgagor, and each such SPC
Party will at all times comply, and shall cause Mortgagor to comply, with each
of the representations, warranties and covenants contained in this PARAGRAPH 19
as if such representation, warranty or covenant was made directly by such SPC
Party; or in the alternative, if Mortgagor is a limited liability company
organized under the laws of the State of Delaware which does not have an SPC
Party as one of its members, then Mortgagor shall have an independent manager
and Mortgagor shall cause to be delivered to Mortgagee such legal opinions with
respect thereto from Delaware counsel reasonably satisfactory to Mortgagee that
address such matters as may be required by Mortgagee or the Rating Agencies at
such time.
(q) Mortgagor shall at all times cause there to be at least one
duly appointed member of the board of directors (an "INDEPENDENT DIRECTOR") of
Mortgagor, in the case of a corporation, and each SPC Party in Mortgagor in the
case of a limited partnership or limited liability company, in each case
reasonably satisfactory to Mortgagee who is not at the time of initial
appointment, and has not been at any time during the preceding five (5) years:
(a) stockholder, director, officer, employee, partner, attorney or counsel of
the SPC Party, the Mortgagor or any affiliate of either of them; (b) a customer,
supplier or other person who derives more than ten percent (10%) of its
purchases or revenues from its activities with the SPC Party, the Mortgagor or
any affiliate of either of them; (c) a person or other entity controlling or
under common control with any such stockholder, partner, customer, supplier or
other person; or (d) a member of the immediate family of any such stockholder,
director, officer, employee, partner, customer, supplier or other person. As
used herein, the term "control" means the possession, directly or indirectly, of
the power to direct or cause the direction of management, policies or activities
of a person or entity, whether through ownership of voting securities, by
contract or otherwise.
(r) Mortgagor shall not cause or permit the board of directors
of any SPC Party in Mortgagor to take any action which, under the terms of any
certificate of incorporation, by-laws or any voting trust agreement with respect
to any common stock, requires the vote of each SPC Party in Mortgagor unless at
the time of such action there shall be at least one member who is an Independent
Director.
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(s) Mortgagor shall conduct its business so that the assumptions
made with respect to Mortgagor in that certain opinion letter dated April __,
2004 (the "Non-Consolidation Opinion") delivered by Levenfeld ▇▇▇▇▇▇▇▇▇▇ in
connection with the Loan shall be true and correct in all respects.
(t) Mortgagor shall allocate fairly and reasonably any overhead
expenses that are shared with an affiliate, including paying for office space
and services performed by any employee of an affiliate.
(u) The stationery, invoices and checks utilized by Mortgagor or
utilized to collect its funds or pay its expenses shall bear its own name and
shall not bear the name of any other entity unless such entity is clearly
designated as being Mortgagor's agent.
(v) Mortgagor shall not pledge its assets for the benefit of any
other person or entity, and other than with respect to the Loan.
(w) Mortgagor shall correct any known misunderstanding regarding
its separate identity.
(x) Mortgagor shall not identify itself as a division of any
other person or entity except for the Trust or Partnership.
20. EVENTS OF DEFAULT; REMEDIES. Each of the following events after
any applicable grace or cure periods shall constitute an "EVENT OF DEFAULT"
hereunder:
(a) if (i) any installment of interest is not paid within five
(5) days after the same is due, (ii) the entire Indebtedness is not paid on or
before the Maturity Date (or if the Maturity Date has been accelerated, upon
such acceleration), or (iii) any other payment or charge due under the Note,
this Mortgage or any other Loan Documents is not paid when due;
(b) if any Taxes payable directly to the billing authority by
Mortgagor are not paid before interest becomes payable on the amount due or a
penalty is assessed (provided that the foregoing provisions of this clause (b)
shall be subject to the right to contest Taxes granted to Mortgagor in PARAGRAPH
4(b) of this Mortgage, but only for so long as the conditions in PARAGRAPH 4(b)
of this Mortgage remain satisfied);
(c) if the Policies are not kept in full force and effect and
are not delivered to Mortgagee when required hereunder, or if the Policies are
not delivered to Mortgagee within ten (10) days after written request by
Mortgagee;
(d) if any of the provisions of PARAGRAPHS 7, 9, 19 or 39 herein
are violated or not complied with;
(e) if any of the events described in PARAGRAPH 41 shall occur;
(f) if at any time any representation or warranty of Mortgagor
or any Guarantor made herein or in any guaranty, agreement, certificate, report,
affidavit, owner's
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affidavit, financial statement or other instrument furnished to Mortgagee shall
be materially false or misleading in any respect;
(g) if any mortgagee under a mortgage on the Mortgaged Property,
whether superior or subordinate to this Mortgage (i) demands payment in full or
otherwise accelerates any indebtedness of Mortgagor or (ii) otherwise commences
the exercise of any remedy available to such party under any Loan Document;
(h) if Mortgagor fails to cure promptly any violation of any law
or ordinance affecting the Mortgaged Property (provided that the foregoing
provisions of this clause (h) shall be subject to any right to contest such
violation specifically granted to Mortgagor in PARAGRAPH 8 of this Mortgage);
(i) if any Guaranty (as hereinafter defined) is terminated or
any event or condition occurs which, in the sole judgment of Mortgagee, may
impair the ability of any Guarantor to perform its obligations under any
Guaranty or any Guarantor attempts to withdraw, cancel or disclaim any Guaranty;
(j) if a default by Mortgagor under any of the other terms,
covenants or conditions of the Note, this Mortgage or any other Loan Document
shall occur and such default shall not have been cured within thirty (30) days
after notice from Mortgagee, provided that if such default is not susceptible of
being cured within such thirty (30) day period and Mortgagor shall have
commenced the cure of such default within such thirty (30) day period and
thereafter diligently pursues such cure to completion, then such thirty (30) day
period shall be extended for a period of ninety (90) days from the occurrence of
the default, provided, further, that the notice and grace period set forth in
this subparagraph (j) shall not apply to any other Event of Default expressly
set forth in this PARAGRAPH 20 or to any other Event of Default defined as such
in any other Loan Document or to any other covenant or condition with respect to
which a grace period is expressly provided elsewhere; or
(k) if any of the provisions of PARAGRAPHS 42(d) and/or
PARAGRAPH 42(f) are violated or not complied with, and/or if any representation
or warranty in PARAGRAPH 42(b) and/or 42(c) shall prove false or misleading in
any respect and/or if any of the events described in PARAGRAPH 42(e) shall
occur.
Upon the occurrence of any Event of Default, the Indebtedness shall
immediately become due at the option of Mortgagee.
Upon the occurrence of any Event of Default, Mortgagor shall pay
interest on the entire unpaid principal balance of the Note, as defined in and
provided for in the Note.
Upon the occurrence of any Event of Default, Mortgagee may, to the
extent permitted under applicable law, elect to treat the fixtures included in
the Mortgaged Property either as real property or as personal property, or both,
and proceed to exercise such rights as apply thereto. With respect to any sale
of real property included in the Mortgaged Property made under the powers of
sale herein granted and conferred, Mortgagee may, to the extent
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permitted by applicable law, include in such sale any fixtures included in the
Mortgaged Property and relating to such real property.
21. ADDITIONAL REMEDIES.
(a) Upon the occurrence of any Event of Default, Mortgagee may
take such action, without notice or demand, as it shall deem advisable to
protect and enforce its rights against Mortgagor and in and to the Mortgaged
Property or any part thereof or interest therein, including, but not limited to,
the following actions, each of which may be pursued concurrently or otherwise,
at such time and in such order as Mortgagee may determine, in its sole
discretion, without impairing or otherwise affecting the other rights and
remedies of Mortgagee (i) enter into or upon the Real Property, either
personally or by its agents, nominees or attorneys and dispossess Mortgagor and
its agents and servants therefrom, and thereupon Mortgagee may (A) use, operate,
manage, control, insure, maintain, repair, restore and otherwise deal with all
and every part of the Mortgaged Property and conduct the business thereat, (B)
complete any construction on the Mortgaged Property in such manner and form as
Mortgagee deems advisable, (C) make alterations, additions, renewals,
replacements and improvements to or on the Mortgaged Property, (D) exercise all
rights and powers of Mortgagor with respect to the Mortgaged Property, whether
in the name of Mortgagor or otherwise, including, without limitation, the right
to make, cancel, enforce or modify leases, obtain and evict tenants and demand,
▇▇▇ for, collect and receive all earnings, revenues, rents, issues, profits and
other income of the Mortgaged Property and every part thereof and (E) apply the
receipts from the Mortgaged Property to the payment of the Indebtedness, after
deducting therefrom all expenses (including reasonable attorneys' fees and
expenses) incurred in connection with the aforesaid operations and all amounts
necessary to pay the taxes, assessments, insurance and other charges in
connection with the Mortgaged Property, as well as just and reasonable
compensation for the services of counsel and other third parties providing
services to Mortgagee, or (ii) institute proceedings for the complete
foreclosure of this Mortgage in which case the Mortgaged Property may be sold
for cash or upon credit in one or more parcels, or (iii) with or without entry,
to the extent permitted and pursuant to the procedures provided by applicable
law, institute proceedings for the partial foreclosure of this Mortgage for the
portion of the Indebtedness then due and payable, subject to the continuing lien
of this Mortgage for the balance of the Indebtedness not then due, or (iv) sell
for cash or upon credit the Mortgaged Property or any part thereof and all or
any part of any estate, claim, demand, right, title and interest of Mortgagor
therein and rights of redemption thereof, pursuant to power of sale or
otherwise, at one or more sales, as an entirety or in parcels, at such time and
place, upon such terms and after such notice thereof as may be required or
permitted by law, and in the event of a sale, by foreclosure or otherwise, of
less than all of the Mortgaged Property, this Mortgage shall continue as a lien
on the remaining portion of or estate in the Mortgaged Property, or (v)
institute an action, suit or proceeding in equity for the specific performance
of any covenant, condition or agreement contained herein or in the Note or any
other Loan Document, or (vi) recover judgment on the Note or any Guaranty either
before, during or after any proceedings for the enforcement of this Mortgage, or
(vii) pursue such other remedies as Mortgagee may have under applicable law.
(b) The purchase money proceeds or avails of any sale made under
or by virtue of this PARAGRAPH 21, together with any other sums which then may
be held by
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Loan No. 6518291
Mortgagee under this Mortgage, whether under the provisions of this PARAGRAPH 21
or otherwise, shall be applied as follows;
FIRST: To the payment of the costs and expenses of any such sale,
including reasonable compensation to Mortgagee, its agents and counsel, and of
any foreclosure or judicial proceedings wherein the same may be made, including
the expense of any litigation and all costs of collection or enforcement of the
Indebtedness secured hereby (including, without limitation, reasonable
attorneys' fees) and of all expenses, liabilities and advances made or incurred
by Mortgagee under this Mortgage, together with interest as provided herein on
all advances made by Mortgagee and all taxes or assessments, except any taxes,
assessments or other charges subject to which the Mortgaged Property shall have
been sold.
SECOND: To the payment of the whole amount then due, owing or unpaid
upon the Note for principal, together with any and all applicable interest, fees
and late charges.
THIRD: To the payment of any other sums required to be paid by
Mortgagor pursuant to any provision of this Mortgage or of the Note or of the
Guaranty.
FOURTH: To the payment of the surplus, if any, to whomsoever may be
lawfully entitled to receive the same.
Mortgagee and any receiver of the Mortgaged Property, or any part
thereof, shall be liable to account for only those rents, issues and profits
actually received by it.
(c) Mortgagee may adjourn from time to time any sale by
Mortgagee 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, Mortgagee,
without further notice or publication, may make such sale at the time and place
to which the same shall be so adjourned.
(d) Upon the completion of any sale or sales made by Mortgagee
under or by virtue of this PARAGRAPH 21, Mortgagee, or an officer of any court
empowered to do so, shall execute and deliver to the accepted purchaser or
purchasers a good and sufficient instrument, or good and sufficient instruments,
conveying, assigning and transferring all estate, right, title and interest in
and to the property and rights sold. Mortgagee is hereby irrevocably appointed
the true and lawful attorney of Mortgagor, in its name and stead, to make all
necessary conveyances, assignments, transfers and deliveries of the Mortgaged
Property and rights so sold and for that purpose Mortgagee may execute all
necessary instruments of conveyance, assignment and transfer, and may substitute
one or more persons with like power, Mortgagor hereby ratifying and confirming
all that its said attorney or such substitute or substitutes shall lawfully do
by virtue hereof. Any such sale or sales made under or by virtue of this
PARAGRAPH 21, whether made under the power of sale herein granted or under or by
virtue of judicial proceedings or of a judgment or decree of foreclosure and
sale, shall operate to divest all the estate, right, title, interest, claim and
demand whatsoever, whether at law or in equity, of Mortgagor in and to the
properties and rights so sold, and shall be a perpetual bar both at law and in
equity against Mortgagor and against any and all persons claiming or who may
claim the same, or any part thereof from, through or under Mortgagor.
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Loan No. 6518291
(e) In the event of any sale made under or by virtue of this
PARAGRAPH 21 (whether made under the power of sale herein granted or under or
by virtue of judicial proceedings or of a judgment or decree of foreclosure and
sale) the entire Indebtedness, if not previously due and payable, immediately
thereupon shall, anything in the Note, this Mortgage, any Guaranty or any other
Loan Document to the contrary notwithstanding, become due and payable.
(f) Upon any sale made under or by virtue of this PARAGRAPH 21
(whether made under the power of sale herein granted or under or by virtue of
judicial proceedings or of a judgment or decree of foreclosure and sale),
Mortgagee may bid for and acquire the Mortgaged Property or any part thereof and
in lieu of paying cash therefor may make settlement for the purchase price by
crediting upon the Indebtedness the net sales price after deducting therefrom
the expenses of the sale and the costs of the action and any other sums which
Mortgagee is authorized to deduct under this Mortgage.
(g) No recovery of any judgment by Mortgagee and no levy of an
execution under any judgment upon the Mortgaged Property or upon any other
property of Mortgagor shall affect in any manner or to any extent, the lien of
this Mortgage upon the Mortgaged Property or any part thereof, or any liens,
rights, powers or remedies of Mortgagee hereunder, but such liens, rights,
powers and remedies of Mortgagee shall continue unimpaired as before.
22. RIGHT TO CURE DEFAULTS. Upon the occurrence of any Event of
Default or if Mortgagor fails to make any payment or to do any act as herein
provided, Mortgagee may, but without any obligation to do so and without notice
to or demand on Mortgagor and without releasing Mortgagor from any obligation
hereunder, make or do the same in such manner and to such extent as Mortgagee
may deem necessary to protect the security hereof. Without limiting the
foregoing, Mortgagee may enter upon the Mortgaged Property for such purposes or
appear in, defend, or bring any action or proceeding to protect its interest in
the Mortgaged Property, and the cost and expense thereof (including, without
limitation, reasonable attorneys' fees and disbursements to the extent permitted
by law), with interest as provided in this PARAGRAPH 22, shall be immediately
due and payable to Mortgagee upon demand by Mortgagee therefor. All such costs
and expenses incurred by Mortgagee in remedying such Event of Default or in
appearing in, defending, or bringing any such action or proceeding shall bear
interest at the Default Rate (as such term is defined in the Note), for the
period from the date that such cost or expense was incurred to the date of
payment to Mortgagee. All such costs and expenses, together with interest
thereon at the Default Rate, shall be added to the Indebtedness and shall be
secured by this Mortgage. If the principal sum of the Note or any other amount
required to be paid on the Maturity Date under the Note shall not be paid on the
Maturity Date, interest shall thereafter be computed and paid at the Default
Rate.
23. LATE PAYMENT CHARGE. If any monthly principal and interest
payment is not paid in accordance with the Note, a late charge (the "LATE
CHARGE") shall be due as provided for in the Note.
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Loan No. 6518291
24. PREPAYMENT. The Indebtedness may be prepaid only in accordance
with the terms of the Note.
25. PREPAYMENT AFTER EVENT OF DEFAULT. A tender of the amount
necessary to satisfy the entire indebtedness, paid at any time following an
Event of Default or acceleration (which acceleration shall be at Mortgagee's
sole option), including at a foreclosure sale or during any subsequent
redemption period, if any, shall be deemed a voluntary prepayment, which payment
shall include a premium, the calculation of which shall be in accordance with
the terms of the Note and shall depend upon whether the Event of Default or
acceleration first occurred (i) prior to the time, if any, the prepayment of the
principal balance is permitted pursuant to the terms of the Note and prior to
the date on which the full amount of the balance of principal and interest then
remaining unpaid shall be due or (ii) on or after the date on which prepayment
of the principal balance is permitted pursuant to the terms of the Note.
26. APPOINTMENT OF RECEIVER. Mortgagee, upon the occurrence of an
Event of Default or in any action to foreclose this Mortgage or upon the actual
or threatened waste to any part of the Mortgaged Property, shall be entitled to
the appointment of a receiver without notice and without regard to the value or
condition of the Mortgaged Property as security for the Indebtedness or the
solvency or insolvency of any person liable for the payment of the Indebtedness.
27. SECURITY AGREEMENT.
(a) This Mortgage is both a real property Mortgage and a
"security agreement" within the meaning of the Uniform Commercial Code. The
Mortgaged Property includes both real and personal property and all other rights
and interests, whether tangible or intangible in nature, of Mortgagor in the
Mortgaged Property. Mortgagor, by executing and delivering this Mortgage grants
to Mortgagee, as security for the Indebtedness, a security interest in the
Mortgaged Property to the full extent that the Mortgaged Property may be subject
to the Uniform Commercial Code (such portion of the Mortgaged Property so
subject to the Uniform Commercial Code being called in this PARAGRAPH 27 the
"COLLATERAL"). Mortgagor hereby authorizes Mortgagee to file financing
statements (and amendments thereto and continuations thereof) in order to
create, perfect, preserve and continue the security interest(s) herein granted.
This Mortgage shall also constitute a "fixture filing" for the purposes of the
Uniform Commercial Code and shall cover all items of the Collateral that are or
are to become fixtures. Information concerning the security interest(s) herein
granted may be obtained from Mortgagee upon request.
If an Event of Default shall occur, Mortgagee, in addition to any
other rights and remedies which it may have, shall have and may exercise
immediately and without demand, any and all rights and remedies granted to a
secured party upon default under the Uniform Commercial Code, including, without
limiting the generality of the foregoing, the right to take possession of the
Collateral or any part thereof, and to take such other measures as Mortgagee may
deem necessary for the care, protection and preservation of the Collateral. Upon
request or demand of Mortgagee, Mortgagor shall at its expense assemble the
Collateral and make it available to Mortgagee at a convenient place reasonably
acceptable to Mortgagee.
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Mortgagor shall pay to Mortgagee on demand any and all expenses, including legal
expenses and attorneys' fees and disbursements, incurred or paid by Mortgagee in
protecting its interest in the Collateral and in enforcing its rights hereunder
with respect to the Collateral. Any notice of sale, disposition or other
intended action by Mortgagee with respect to the Collateral sent to Mortgagor in
accordance with the provisions hereof at least five (5) days prior to such sale,
disposition or action shall constitute reasonable notice to Mortgagor. The
proceeds of any disposition of the Collateral, or any part thereof, may be
applied by Mortgagee to the payment of the Indebtedness in such priority and
proportions as Mortgagee in its discretion shall deem proper.
Mortgagor shall notify Mortgagee of any change in name, identity
or structure of Mortgagor, and Mortgagor hereby expressly authorizes Mortgagee
to file and record, at its sole cost and expense, such Uniform Commercial Code
forms as are necessary to maintain the priority of the lien of Mortgagee upon
and security interest in the Collateral. In addition, Mortgagor shall promptly
execute, file and record such additional Uniform Commercial Code forms or
continuation statements as Mortgagee shall deem necessary and shall pay all
expenses and fees in connection with the filing and recording thereof, provided
that no such additional documents shall increase the obligations of Mortgagor
under the Note, this Mortgage or the other Loan Documents. Mortgagor hereby
grants to Mortgagee an irrevocable power of attorney, coupled with an interest,
to file with the appropriate public office on its behalf any financing or other
statements in connection with the Collateral covered by this Mortgage.
(b) That portion of the Mortgaged Property consisting of
personal property and equipment, shall be owned by Mortgagor and shall not be
the subject matter of any lease or other transaction whereby the ownership or
any beneficial interest in any of such property is held by any person or entity
other than Mortgagor nor shall Mortgagor create or suffer to be created any
security interest covering any such property as it may from time to time be
replaced, other than the security interest created herein.
28. AUTHORITY.
(a) Mortgagor has full power, authority and legal right to
execute this Mortgage, and to mortgage, give, grant, bargain, sell, alien,
enfeoff, convey, confirm, pledge, hypothecate and assign and grant a security
interest in the Mortgaged Property pursuant to the terms hereof and to keep and
observe all of the terms of this Mortgage on Mortgagor's part to be performed.
(b) Mortgagor represents and warrants to Mortgagee that
Mortgagor is not a "foreign person" and covenants with Mortgagee that Mortgagor
will not, throughout the term of the Note, become a "foreign person" within the
meaning of Section 1445 and Section 7701 of the Internal Revenue Code of 1986,
(26 USC Sections 1445, 7701) and the related Treasury Department regulations,
including, without limitation, temporary regulations (hereinafter collectively
the "CODE"); that is, such Mortgagor is not a non-resident alien, foreign
corporation, foreign partnership, foreign trust or foreign estate as those terms
are defined in the Code.
(c) Mortgagor represents and warrants to Mortgagee that
Mortgagor is a limited liability company organized and existing under the laws
of the State of Delaware.
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29. ACTIONS AND PROCEEDINGS. Mortgagee shall have the right to appear
in and defend any action or proceeding brought with respect to the Mortgaged
Property and to bring any action or proceeding, in the name and on behalf of
Mortgagor, which Mortgagee, in its discretion, shall decide should be brought to
protect its interest(s) in the Mortgaged Property.
30. FURTHER ACTS, ETC. Mortgagor will, at the sole cost of Mortgagor,
and without expense to Mortgagee, do, execute, acknowledge and deliver all and
every such further acts, deeds, conveyances, mortgages, assignments, notices of
assignments, transfers and assurances as Mortgagee shall, from time to time,
require, for the better assuring, conveying, assigning, transferring and
confirming unto Mortgagee the property and rights hereby mortgaged, given,
granted, bargained, sold, aliened, enfeoffed, conveyed, confirmed, pledged,
assigned and hypothecated or intended now or hereafter so to be, or which
Mortgagor may be or may hereafter become bound to convey or assign to Mortgagee,
or for carrying out the intention or facilitating the performance of the terms
of this Mortgage or for filing, registering or recording this Mortgage and, on
demand, will execute and deliver within five (5) business days after request of
Mortgagee, and if Mortgagor fails to so deliver, hereby authorizes Mortgagee
thereafter to execute in the name of Mortgagor without the signature of
Mortgagor to the extent Mortgagee may lawfully do so, one or more financing
statements, chattel mortgages or comparable security instruments, to evidence
more effectively the lien hereof upon the Mortgaged Property. Mortgagor grants
to Mortgagee an irrevocable power of attorney coupled with an interest for the
purpose of exercising and perfecting any and all rights and remedies available
to Mortgagee at law and in equity, including without limitation such rights and
remedies available to Mortgagee pursuant to this PARAGRAPH 30.
31. RECORDING OF MORTGAGE, ETC. Mortgagor forthwith upon the
execution and delivery of this Mortgage, will cause this Mortgage, and any
security instrument creating a lien or security interest or evidencing the lien
hereof upon the Mortgaged Property, to be filed, registered or recorded and,
thereafter, from time to time, each such other instrument of further assurance
to be filed, registered or recorded, all in such manner and in such places as
may be required by any present or future law in order to publish notice of and
fully to protect the lien or security interest hereof upon, and the interest(s)
of Mortgagee in, the Mortgaged Property. Mortgagor will pay all filing,
registration or recording fees, and all expenses incident to the preparation,
execution and acknowledgment of this Mortgage, any Mortgage supplemental hereto,
any security instrument with respect to the Mortgaged Property and any
instrument of further assurance, and all federal, state, county and municipal,
taxes, duties, imposts, assessments and charges arising out of or in connection
with the making, execution, delivery and/or recording of this Mortgage, any
Mortgage supplemental hereto, any security instrument with respect to the
Mortgaged Property or any instrument of further assurance, except where
prohibited by law so to do. Mortgagor shall hold harmless and indemnify
Mortgagee, its successors and assigns, against any liability incurred by reason
of the imposition of any tax on the making, execution, delivery and/or recording
of this Mortgage, any Mortgage supplemental hereto, any security instrument with
respect to the Mortgaged Property or any instrument of further assurance.
32. USURY LAWS. This Mortgage and the Note are subject to the express
condition that at no time shall Mortgagor be obligated or required to pay
interest on the principal balance due under the Note at a rate which could
subject the holder of the Note to either civil or
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criminal liability as a result of being in excess of the maximum interest rate
which Mortgagor is permitted by law to contract or agree to pay. If by the terms
of this Mortgage or the Note, Mortgagor is at any time required or obligated to
pay interest on the principal balance due under the Note at a rate in excess of
such maximum rate, the rate of interest under the Note shall be deemed to be
immediately reduced to such maximum rate and the interest payable shall be
computed at such maximum rate and all prior interest payments in excess of such
maximum rate shall be applied and shall be deemed to have been payments in
reduction of the principal balance of the Note and the principal balance of the
Note shall be reduced by such amount in the inverse order of maturity.
33. SOLE DISCRETION OF MORTGAGEE. Wherever pursuant to this Mortgage,
Mortgagee exercises any right given to it to approve or disapprove, or any
arrangement or term is to be satisfactory to Mortgagee, the decision of
Mortgagee to approve or disapprove or to decide that arrangements or terms are
satisfactory or not satisfactory shall be in the sole discretion of Mortgagee
and shall be final and conclusive, except as may be otherwise specifically
provided herein.
34. RECOVERY OF SUMS REQUIRED TO BE PAID. Mortgagee shall have the
right from time to time to take action to recover any sum or sums which
constitute a part of the Indebtedness as the same become due, without regard to
whether or not the balance of the Indebtedness shall be due, and without
prejudice to the right of Mortgagee thereafter to bring an action of
foreclosure, or any other action, for a default or defaults by Mortgagor
existing at the time such earlier action was commenced.
35. MARSHALLING AND OTHER MATTERS. Mortgagor waives, to the extent
permitted by law, the benefit of all appraisement, valuation, stay, extension,
reinstatement and redemption laws now or hereafter in force and all rights of
marshalling in the event of any sale hereunder of the Mortgaged Property or any
part thereof or any interest therein. Further, Mortgagor expressly waives any
and all rights of redemption from sale under any order or decree of foreclosure
of this Mortgage on behalf of Mortgagor, and on behalf of each and every person
acquiring any interest in or title to the Mortgaged Property subsequent to the
date of this Mortgage and on behalf of all persons to the extent permitted by
applicable law.
36. WAIVER OF NOTICE. Mortgagor shall not be entitled to any notices
of any nature whatsoever from Mortgagee except with respect to matters for which
this Mortgage specifically and expressly provides for the giving of notice by
Mortgagee to Mortgagor and except with respect to matters for which Mortgagee is
required by applicable law to give notice, and Mortgagor hereby expressly waives
the right to receive any notice from Mortgagee with respect to any matter for
which this Mortgage does not specifically and expressly provide for the giving
of notice by Mortgagee to Mortgagor.
37. REMEDIES OF MORTGAGOR. In the event that a claim or adjudication
is made that Mortgagee has acted unreasonably or unreasonably delayed acting in
any case where by law or under the Note, this Mortgage or the other Loan
Documents, it has an obligation to act reasonably or promptly, Mortgagee shall
not be liable for any monetary damages, and Mortgagor's remedies shall be
limited to injunctive relief or declaratory judgment.
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38. REPORTING REQUIREMENTS. At the request of Mortgagee, Mortgagor
shall supply or cause to be supplied to Mortgagee either (a) a copy of a
completed Form. ▇▇▇▇-▇, ▇▇▇▇▇▇▇▇▇ for Recipients of Proceeds from Real Estate,
Broker and Barter Exchange Proceeds prepared by Mortgagor's attorney or other
person responsible for the preparation of such form, together with a certificate
from the person who prepared such form to the effect that such form has, to the
best of such person's knowledge, been accurately prepared and that such person
will timely file such form or (b) a certification from Mortgagor that the Loan
is a refinancing of the Mortgaged Property or is otherwise not required to be
reported to the Internal Revenue Service pursuant to Section 6045(e) of the
Code. Mortgagor hereby indemnifies, defends and holds Mortgagee harmless from
and against all loss, cost, damage and expense (including without limitation,
attorneys' fees and disbursements and costs incurred in the investigation,
defense and settlement of claims) that Mortgagee may incur, directly or
indirectly, as a result of or in connection with the assertion against Mortgagee
of any claim relating to the failure of Mortgagee to comply with this PARAGRAPH
38.
39. HAZARDOUS MATERIALS.
(a) Mortgagor represents and warrants that based on the Phase I
environmental report prepared by S&ME dated March, 2004 (the "Report") (i) the
Mortgaged Property is now and at all times during Mortgagor's ownership thereof
has been free of contamination from any petroleum product and all hazardous or
toxic substances, wastes or substances, any substances which because of their
quantitative concentration, chemical, radioactive, flammable, explosive,
infectious or other characteristics, constitute or may reasonably be expected to
constitute or contribute to a danger or hazard to public health, safety or
welfare or to the environment, including, without limitation, any asbestos
(whether or not friable) and any asbestos-containing materials, Mold (defined as
the presence of any form of (i) multicellular fungi that live on plant or animal
matter and an indoor environment (including without limitation Cladosporium,
Penicillium, Alternaria, Aspergillus, Fusarium, Trichoderma, Memnoniella, Mucor,
and Stachybotrys chartarum (SC) often found in water damaged building
materials), (ii) spores, scents or byproducts produced or released by fungi,
including mycotoxins and (iii) microbial matter which reproduces through mold,
mildew and viruses, whether or not such microbial matter is living (collectively
"MOLD")), waste oils, solvents and chlorinated oils, polychlorinated biphenyls
(PCBs), toxic metals, etchants, pickling and plating wastes, explosives,
reactive metals and compounds, pesticides, herbicides, radon gas, urea
formaldehyde foam insulation and chemical, biological and radioactive wastes, or
any other similar materials or any hazardous or toxic wastes or substances which
are included under or regulated by any federal, state or local law, rule or
regulation (whether now existing or hereafter enacted or promulgated, as they
may be amended from time to time) pertaining to environmental regulations,
contamination, clean-up or disclosures, and any judicial or administrative
interpretation thereof, including any judicial or administrative orders or
judgments ("HAZARDOUS MATERIALS") including, without limitation, the
Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42
U.S.C. section 9601 ET SEQ. ("CERCLA"); The Federal Resource Conservation and
Recovery Act, 42 U.S.C. section 6901 ET SEQ. ("RCRA"); Superfund Amendments and
Reauthorization Act of 1986, Public Law No. 99-499 ("▇▇▇▇"); Toxic Substances
Control Act, 15 U.S.C. section 2601 ET SEQ. ("TSCA"): the Hazardous Materials
Transportation Act, 49 U.S.C. section 1801 ET SEQ.; and any other state
superlien or
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environmental clean-up or disclosure statutes (all such laws, rules and
regulations being referred to collectively as "ENVIRONMENTAL LAWS"), (ii)
Mortgagor has not caused or suffered to occur any discharge, spill, uncontrolled
loss or seepage of any Hazardous Materials onto any property adjoining the
Mortgaged Property, (iii) Mortgagor has not received any complaint, notice,
letter, or other communication from occupants, tenants, guests, employees,
licensees or any other person regarding odors, poor indoor quality, Mold, or any
activity, condition, event or omission that causes or facilitates the growth of
Mold and Mortgagor further represents to the best of its knowledge that no Mold
or any activity, condition, event or omission that causes or facilitates the
growth of Mold exists at the property, and (iv) neither the Mortgagor nor to
Mortgagor's best knowledge any tenant or occupant of all or part of the
Mortgaged Property is now or has been involved in operations at the Mortgaged
Property which could lead to liability for Mortgagor or any other owner of the
Mortgaged Property or the imposition of a lien on the Mortgaged Property under
any Environmental Law.
(b) At its sole cost and expense, Mortgagor shall comply with
and shall cause all tenants and other occupants of the Mortgaged Property to
comply with all Environmental Laws now in effect or hereafter enacted with
respect to the discharge, generation, removal, transportation, storage and
handling of Hazardous Materials. Mortgagor shall promptly notify Mortgagee if
Mortgagor shall become aware of any Hazardous Materials on or near the Mortgaged
Property (except materials which (i) are ordinarily and customarily used in the
regular operation of the Mortgaged Property as a commercial retail facility by
the Mortgagor or any current tenant or any future tenant, which tenant and its
Lease have been approved by the Mortgagee, and (ii) are used, stored, disposed
of and handled in compliance with and in quantities permitted by all applicable
Environmental Laws) and/or if Mortgagor shall become aware that the Mortgaged
Property is in direct or indirect violation of any Environmental Laws and/or if
Mortgagor shall become aware of any condition on or near the Mortgaged Property
which shall pose a threat to the health, safety or welfare of humans. Mortgagor
shall promptly remove all Hazardous Materials from the Mortgaged Property, such
removal to be performed in accordance with all applicable federal, state and
local laws, statutes, rules and regulations. Mortgagor shall pay immediately
when due the cost of removal of any Hazardous Materials and shall keep the
Mortgaged Property free of any lien imposed pursuant to any Environmental Laws
now in effect or hereinafter enacted.
(c) Mortgagor grants Mortgagee and its employees and agents an
irrevocable and non-exclusive license, subject to the rights of tenants, to
enter the Mortgaged Property in the event that Mortgagee has a reasonable belief
that a violation of Environmental Laws or release or threatened release of
Hazardous Materials has occurred on or onto the Mortgaged Property, or at any
time after an uncured Event of Default under the Loan Documents, to conduct
testing and to remove any Hazardous Materials, and the costs of such testing and
removal shall immediately become due to Mortgagee and shall be secured by this
Mortgage. Mortgagor, promptly upon the request of Mortgagee, and only if
Mortgagee has a reasonable belief that there is a change in the environmental
condition of the Mortgaged Property, shall provide Mortgagee with an
environmental site assessment or environmental audit report, or an update of
such an assessment or report, all in scope, form and content satisfactory to
Mortgagee. Mortgagor shall maintain the integrity of all storage tanks and drums
on or under the Mortgaged Property during the term of the Loan in compliance
with all Environmental Laws
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now in effect or hereinafter enacted. Mortgagor shall follow an operation and
maintenance program with respect to all storage tanks and drums on or under the
Mortgaged Property, which program has been approved in writing by Mortgagee.
(d) Mortgagor shall indemnify Mortgagee and hold Mortgagee
harmless from and against all liability, loss, cost, damage and expense
(including, without limitation, reasonable attorneys' fees and costs incurred in
the investigation, defense and settlement of claims) that Mortgagee may incur as
a result of or in connection with the assertion against Mortgagee (whether as
past or present holder of this Mortgage, as mortgagee in possession or as past
or present owner of the Mortgaged Property by virtue of a foreclosure or
acceptance of a deed in lieu of foreclosure) of any claim relating to the
presence and/or release, threatened release, storage, disposal, generating or
removal of any Hazardous Materials or compliance with any Environmental Laws now
in effect or hereinafter enacted except for the gross negligence or willful
misconduct of Mortgagee. Mortgagor specifically acknowledges and agrees that all
of the indemnities set forth in this Paragraph 39(d) and elsewhere in this
Mortgage shall further include without limitation any and all loss, cost,
liability, damage, claim or expense, including without limitation reasonable
attorneys' fees, suffered or incurred by Mortgagee at any time on account of or
related to any contamination or migration of contamination arising from or
relating to the former dry cleaning location (known as One Hour Martinizing
#435, Quick As A Wink 435 or Prestige Cleaners) at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
identified in the Phase I Environmental Site Assessment, ▇▇▇▇▇▇ Centre Tracts,
W.O. ▇▇▇▇▇ Blvd., Spartanburg, South Carolina, S&ME Project No. 1264-99-157J
dated March 2004 and prepared by S&ME, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇▇▇▇. Subject to the provisions of Paragraph 9(f) above, the obligations and
liabilities of Mortgagor under this PARAGRAPH 39 shall survive full payment of
the Loan, entry of a judgment of foreclosure or acceptance of a deed in lieu of
foreclosure or any subsequent transfer to a third party. It is understood that
the presence and/or release of substances referred to in this section hereof
does not pertain to a presence and/or release which first occurs solely after
(A) repayment of the Loan in full in accordance with the Loan Documents or (B)
possession of the Property by Mortgagee upon a foreclosure or acceptance of a
deed in lieu of foreclosure and surrender of possession and occupancy of the
Property by Mortgagor, its agents, affiliates, employees and independent
contractors. Mortgagor shall have the burden of establishing that the conditions
in subsection (d) were satisfied by clear and convincing evidence and shall
indemnify and hold Mortgagee harmless for all matters set forth in this
Paragraph 39, until Mortgagor has met such burden; Mortgagee agrees that
Mortgagor shall have met such burden with respect to the Mortgaged Property if
Mortgagor at such time delivers to Mortgagee an environmental insurance policy
satisfactory in all respects to Mortgagee in its reasonable discretion.
(e) Nothing contained herein shall constitute or be construed as
a waiver of any statutory or judicial federal, state or local law which may
provide rights or remedies to Mortgagee against Mortgagor or others in
connection with any claim relating to the Mortgaged Property and pertaining to
the presence and/or release, threatened release, storage, disposal, generating
or removal of any Hazardous Materials or to the failure to comply with any
Environmental Laws now or hereafter enacted.
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40. ASBESTOS. Mortgagor shall not install or permit to be installed
in the Mortgaged Property, Friable asbestos or any substance containing
asbestos. With respect to any such material currently present in the Mortgaged
Property, Mortgagor, at Mortgagor's expense, shall promptly comply with and
shall cause all occupants of the Mortgaged Property to comply with all present
and future applicable federal, state or local laws, rules, regulations or orders
relating to asbestos, friable asbestos and asbestos containing materials. In the
event any asbestos, friable asbestos or asbestos containing material is
discovered at the Mortgaged Property, Mortgagor shall obtain a comprehensive
asbestos report prepared by a licensed engineer or asbestos consultant
acceptable to Mortgagee describing the form, extent, location and condition of
such asbestos and recommending methods of removal or abatement. Mortgagor shall
promptly comply at its sole cost and expense with the recommendations contained
in such report, such compliance to be performed in accordance with all
applicable federal, state and local laws, statutes, rules and regulations.
Mortgagor shall indemnify Mortgagee and hold Mortgagee harmless from and against
all loss, cost, damage and expense (including, without limitation, attorneys'
fees and costs incurred in the investigation, defense and settlement of claims)
that Mortgagee may incur as a result of or in connection with the assertion
against Mortgagee (whether as past or present holder of the Mortgage, as
mortgagee in possession, or as past or present owner of the Mortgaged Property
by virtue of a foreclosure or acceptance of a deed in lieu of foreclosure) of
any claim relating to the presence or removal of any asbestos substance referred
to in this PARAGRAPH 40, or compliance with any federal, state or local laws,
rules, regulations or orders relating thereto. The obligations and liabilities
of Mortgagor under this PARAGRAPH 40 shall survive full payment of the Loan,
entry of a judgment of foreclosure or the acceptance of a deed in lieu of
foreclosure.
41. BANKRUPTCY OR INSOLVENCY. In the event that Mortgagor or any
Guarantor or, if Mortgagor or any Guarantor is a general or limited partnership,
any general partner of any such entity (a) admits in writing its inability to
pay its debts generally as they become due, or does not pay its debts generally
as they become due, (b) commences as debtor any case or proceeding under any
bankruptcy, insolvency, reorganization, liquidation, dissolution or similar law,
or seeks or consents to the appointment of a receiver, conservator, trustee,
custodian, manager, liquidator or similar official for it or the whole or any
substantial part of its property, (c) has a receiver, conservator, trustee,
custodian, manager, liquidator, or similar official appointed for it or the
whole or any substantial part of its property, by any governmental authority
with jurisdiction to do so, (d) makes a proposal or any assignment for the
benefit of its creditors, or enters into an arrangement or composition or
similar plan or scheme with or for the benefit of creditors generally occurring
in circumstances in which such entity is unable to meet its obligations as they
become due or (e) has filed against it any case or proceeding under any
bankruptcy, insolvency, reorganization, liquidation, dissolution or similar law
which (i) is consented to or not timely contested by such entity, (ii) results
in the entry of an order for relief, appointment of a receiver, conservator,
trustee, custodian, manager, liquidator or similar official for such entity or
the whole or any substantial part of its property or (iii) is not dismissed
within sixty (60) days, an Event of Default shall have occurred and as a result,
the entire principal balance of the Note and all obligations under any Guaranty
shall become immediately due and payable at the option of Mortgagee without
notice to Mortgagor or any Guarantor and Mortgagee may exercise any remedies
available to it hereunder, under any other Loan Document, at law or in equity.
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Loan No. 6518291
42. COMPLIANCE WITH ERISA AND STATE STATUTES ON GOVERNMENTAL PLANS.
(a) Mortgagee represents and warrants to Mortgagor that, as of
the date of this Mortgage and throughout the term of this Mortgage, the source
of funds from which Mortgagee extends this Mortgage is its general account,
which is subject to the claims of its general creditors under state law.
(b) Mortgagor represents and warrants that, as of the date of
this Mortgage and throughout the term of this Mortgage, (i) Mortgagor is not an
"employee benefit plan" as defined in Section 3(3) of the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), which is subject to Title I
of ERISA and (ii) the assets of such Mortgagor do not constitute "plan assets"
of one or more such plans within the meaning of 29 C.F.R. Section 2510.3-101.
(c) Mortgagor represents and warrants to Mortgagee that, as of
the date of this Mortgage and throughout the term of this Mortgage (i) Mortgagor
is not a "governmental plan" within the meaning of Section 3(32) of ERISA and
(ii) transactions by or with Mortgagor or any Mortgagor are not subject to state
statutes regulating investments of and fiduciary obligations with respect to
governmental plans.
(d) Mortgagor covenants and agrees to deliver to Mortgagee such
certifications or other evidence from time to time throughout the term of this
Mortgage, as reasonably requested by Mortgagee in its sole discretion, that (i)
Mortgagor is not an "employee benefit plan" or a "governmental plan", (ii)
Mortgagor is not subject to state statutes regulating investments and fiduciary
obligations with respect to governmental plans, and (iii) one or more of the
following circumstances is true:
(A) Equity interests in Mortgagor are publicly offered
securities, within the meaning of 29 C.F.R. Section
2510.3-101(b)(2);
(B) Less than 25 percent of all equity interests in such
Mortgagor are held by "benefit plan investors" within the
meaning of 29 C.F.R. Section 2510.3-101(f)(2); or
(C) Mortgagor qualifies as an "operating company" or a "real
estate operating company" within the meaning of 29 C.F.R.
Section 2510.3.-101(c)or(e).
(e) Any of the following shall constitute an Event of Default
under this Mortgage, entitling Mortgagee to exercise any and all remedies to
which it may be entitled under this Mortgage, and any other Loan Documents (i)
the failure of any representation or warranty made by any Mortgagor under this
PARAGRAPH 42 to be true and correct in all respects, (ii) the failure of any
Mortgagor to provide Mortgagee with the written certifications and evidence
referred to in this PARAGRAPH 42 within five (5) days after written notice or
(iii) the consummation by Mortgagor or any one Mortgagor of a transaction which
would cause this Mortgage or any exercise of Mortgagee's rights under this
Mortgage, or the other Loan Documents to constitute a non-exempt prohibited
transaction under ERISA or a violation of a
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state statute regulating governmental plans, or otherwise subjecting Mortgagee
to liability for violation of ERISA or such state statute.
(f) Mortgagor shall indemnify Mortgagee and defend and hold
Mortgagee harmless from and against all civil penalties, excise taxes, or other
loss, cost, damage and expense (including, without limitation, reasonable
attorneys' fees and disbursements and costs incurred in the investigation,
defense and settlement of claims and losses incurred in correcting any
prohibited transaction or in the sale of a prohibited loan, and in obtaining any
individual prohibited transaction exemption under ERISA that may be required, in
Mortgagee's sole discretion) that Mortgagee may incur, directly or indirectly,
as a result of a default under this PARAGRAPH 42. This indemnity shall survive
any termination, satisfaction or foreclosure of this Mortgage.
43. ASSIGNMENTS. Mortgagee shall have the right to assign or transfer
its rights under this Mortgage without limitation at no cost to Mortgagor. Any
assignee or transferee shall be entitled to all the benefits afforded Mortgagee
under this Mortgage.
44. COOPERATION. Mortgagor acknowledges that Mortgagee and its
successors and assigns may (a) sell this Mortgage, the Note and other Loan
Documents to one or more investors as a whole loan, (b) participate the Loan to
one or more investors, (c) deposit this Mortgage, the Note and other Loan
Documents with a trust, which trust may sell certificates to investors
evidencing an ownership interest in the trust assets or (d) otherwise sell the
Loan or interest therein to investors (the transactions referred to in clauses
(a) through (d) are hereinafter referred to as "SECONDARY MARKET TRANSACTIONS").
Mortgagor shall cooperate in good faith with Mortgagee (aa) in effecting any
such Secondary Market Transaction and (bb) to implement all requirements imposed
by the Rating Agency involved in any Secondary Market Transaction including,
without limitation, all structural or other changes to the Loan, modifications
to any documents evidencing or securing the Loan, delivery of opinions of
counsel acceptable to the Rating Agency and addressing such matters as the
Rating Agency may require; PROVIDED, HOWEVER, that Mortgagor shall not be
required to modify any documents evidencing or securing the Loan which would
modify (i) the interest rate payable under the Note, (ii) the stated maturity of
the Note, (iii) the amortization of principal of the Note or (iv) any other
material economic term of the Loan. Mortgagor shall provide such information and
documents relating to Mortgagor, Guarantor, if any, the Mortgaged Property, the
Leases and the tenants thereunder as Mortgagee may reasonably request in
connection with a Secondary Market Transaction. Mortgagee shall have the right
to provide to prospective investors any information in its possession,
including, without limitation, financial statements relating to Mortgagor, the
Guarantor, if any, the Mortgaged Property and the tenants under the Leases.
Mortgagor acknowledges that certain information regarding the Loan and the
parties thereto and the Mortgaged Property may be included in a private
placement memorandum, prospectus or other disclosure documents.
45. INDEMNIFICATION FOR NON-RECOURSE CARVEOUT OBLIGATIONS. Mortgagor
hereby covenants and agrees unconditionally and absolutely to indemnify and save
harmless Mortgagee, its officers, directors, shareholders, employees, agents and
attorneys against all damages, losses, liabilities, obligation, claims,
litigation, demands or defenses, judgments, suits,
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Loan No. 6518291
proceedings, fines, penalties, costs, disbursements and expenses of any kind or
nature whatsoever (including without limitation attorneys' fees reasonably
incurred), which may at any time be imposed upon, incurred by or asserted or
awarded against Mortgagee and arising from the Non-Recourse Carveout Obligations
except to the extent arising from the gross negligence or willful misconduct of
Mortgagee.
This indemnity shall survive any foreclosure of this Mortgage, the
taking of a deed in lieu thereof, or any other discharge of the obligations of
the Mortgagor hereunder or a transfer of the Mortgaged Property, even if the
indebtedness secured hereby is satisfied in full. Mortgagor agrees that the
indemnification granted herein may be enforced by Mortgagee without resorting to
or exhausting any other security or collateral or without first having recourse
to the Note or the Mortgaged Property covered by this Mortgage through
foreclosure proceedings or otherwise; provided, however, that, subject to
PARAGRAPH 46 of this Mortgage, nothing herein contained shall prevent Mortgagee
from suing on the Note or foreclosing this Mortgage or from exercising any other
rights under the Loan Documents.
46. EXCULPATION. Notwithstanding anything to the contrary contained
herein, but subject to PARAGRAPH 45 hereof, any claim based on or in respect of
any liability of Mortgagor under the Note or under this Mortgage or any other
Loan Document shall be enforced only against the Mortgaged Property and any
other collateral now or hereafter given to secure the Loan and not against any
other assets, properties or funds of Mortgagor; PROVIDED, HOWEVER, that the
liability of Mortgagor for loss, costs or damage arising out of the matters
described below (collectively, "Non-Recourse Carveout Obligations") shall not be
limited solely to the Mortgaged Property and other collateral now or hereafter
given to secure the Loan but shall include all of the assets, properties and
funds of Mortgagor: (i) fraud, misrepresentation and waste, (ii) any rents,
issues or profits collected more than one (1) month in advance of their due
dates to the extent such sums remain collected more than one month in advance of
their due dates following an Event of Default, (iii) any misapplication of
rents, issues or profits, security deposits and any other payments from tenants
or occupants (including, without limitation, lease termination fees) insurance
proceeds, condemnation awards, or other sums of a similar nature to the extent
such misapplication continues following an Event of Default, (iv) liability
under environmental covenants, conditions and indemnities contained in this
Mortgage and in any separate environmental indemnity agreements, (v) personalty
or fixtures removed or allowed to be removed by or on behalf of Mortgagor and
not replaced by items of equal or greater value or functionality than the
personalty or fixtures so removed, (vi) failure to pay taxes, assessments or
ground rents prior to delinquency, or to pay charges for labor, materials or
other charges which can create liens on any portion of the Mortgaged Property
and any sums expended by Mortgagee in the performance of or compliance with the
obligations of Mortgagor under the Loan Documents, including, without
limitation, sums expended to pay taxes or assessments or hazard insurance
premiums or bills for utilities or other services or products for the benefit of
the Mortgaged Property, (vii) the unauthorized sale, conveyance or transfer of
title to the Mortgaged Property or encumbrance of the Mortgaged Property, (viii)
the failure of Mortgagor to maintain its status as a single purpose,
bankruptcy-remote entity pursuant to its organizational documents and the Loan
Documents, and (ix) reasonable attorney's fees, court costs and other expenses
incurred by Mortgagee in connection with enforcement of Mortgagor's personal
liability as set forth herein. Nothing herein shall be deemed (w) to be a waiver
of any right which Mortgagee
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Loan No. 6518291
may have under any bankruptcy law of the United States or the state where the
Mortgaged Property is located including, but not limited to, Section 506(a),
506(b), llll(b) or any other provisions of the U.S. Bankruptcy Code, to file a
claim for the full amount of the indebtedness secured by this Mortgage or to
require that all of the collateral securing the indebtedness secured hereby
shall continue to secure all of the indebtedness owing to Mortgagee under the
Note, this Mortgage and the other Loan Documents; (x) to impair the validity of
the indebtedness secured by this Mortgage; (y) to impair the right of Mortgagee
as Mortgagee or secured party to commence an action to foreclose any lien or
security interest; or (z) to modify, diminish or discharge the liability of any
Guarantor under any Guaranty.
47. NOTICES. Any notice, demand, statement, request or consent made
hereunder shall be effective and valid only if in writing, referring to this
Mortgage, signed by the party giving such notice, and delivered either
personally to such other party, or sent by nationally recognized overnight
courier delivery service or by certified mail of the United States Postal
Service, postage prepaid, return receipt requested, addressed to the other party
as follows (or to such other address or person as either party or person
entitled to notice may by notice to the other party specify):
TO MORTGAGEE:
▇▇▇▇ ▇▇▇▇▇▇▇ Life Insurance Company
Real Estate Investment Group
▇▇▇▇ ▇▇▇▇▇▇▇ Tower, T-56
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Re: Loan No. 6518291
with a copy concurrently to:
▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. Sarasek, Esq.
TO MORTGAGOR:
Inland Western Spartanburg, L.L.C.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Vice President
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Loan No. 6518291
with a copy concurrently to:
The Inland Real Estate Group, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇, Esq., General Counsel
Unless otherwise specified, notices shall be deemed given as follows:
(i) if delivered personally, when delivered, (ii) if delivered by nationally
recognized overnight courier delivery service, on the day following the day such
material is sent, or (iii) if delivered by certified mail, on the third day
after the same is deposited with the United States Postal Service as provided
above.
48. NON-WAIVER. The failure of Mortgagee to insist upon strict
performance of any term hereof shall not be deemed to be a waiver of any term of
this Mortgage. Mortgagor shall not be relieved of Mortgagor's obligations
hereunder by reason of (a) failure of Mortgagee to comply with any request of
Mortgagor or any Guarantor to take any action to foreclose this Mortgage or
otherwise enforce any of the provisions hereof or of the Note, any Guaranty or
the other Loan Documents, (b) the release, regardless of consideration, of the
whole or any part of the Mortgaged Property, or of any person liable for the
Indebtedness or portion thereof or (c) any agreement or stipulation by Mortgagee
extending the time of payment or otherwise modifying or supplementing the terms
of the Note, any Guaranty, this Mortgage or the other Loan Documents. Mortgagee
may resort for the payment of the Indebtedness to any other security held by
Mortgagee in such order and manner as Mortgagee, in its discretion, may elect.
Mortgagee may take action to recover the Indebtedness, or any portion thereof,
or to enforce any covenant hereof without prejudice to the right of Mortgagee
thereafter to foreclose this Mortgage. The rights of Mortgagee under this
Mortgage shall be separate, distinct and cumulative and none shall be given
effect to the exclusion of the others. No act of Mortgagee shall be construed as
an election to proceed under any one provision herein to the exclusion of any
other provision. Mortgagee shall not be limited exclusively to the rights and
remedies herein stated but shall be entitled to every right and remedy now or
hereafter afforded by law.
49. JOINT AND SEVERAL LIABILITY. If there is more than one party
comprising Mortgagor, then the obligations and liabilities of each party under
this Mortgage shall be joint and several.
50. SEVERABILITY. If any term, covenant or condition of the Note, any
Guaranty or this Mortgage is held to be invalid, illegal or unenforceable in any
respect, the Note, any Guaranty and this Mortgage shall be construed without
such provision.
51. DUPLICATE ORIGINALS. This Mortgage may be executed in any number
of duplicate originals and each such duplicate original shall be deemed to
constitute but one and the same instrument.
52. INDEMNITY AND MORTGAGEE'S COSTS. Mortgagor agrees to pay all
costs, including, without limitation, reasonable attorneys' fees and expenses,
incurred by Mortgagee in
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Loan No. 6518291
enforcing the terms hereof and/or the terms of any of the other Loan Documents
or the Note or any Guaranty, whether or not suit is filed and waives to the full
extent permitted by law all right to plead any statute of limitations as a
defense to any action hereunder. Mortgagor agrees to indemnify and hold
Mortgagee harmless from any and all liability, loss, damage or expense
(including, without limitation, attorneys' fees and disbursements) that
Mortgagee incurs hereunder or in connection with the enforcement of any of its
rights or remedies hereunder, any action taken by Mortgagee hereunder, or by
reason or in defense of any and all claims and demands whatsoever that are
asserted against Mortgagee arising out of the Mortgaged Property; and should
Mortgagee incur any such liability, loss, damage or expense, the amount thereof
with interest thereon at the Default Rate shall be payable by Mortgagor
immediately without demand, shall be secured by this Mortgage, and shall be a
part of the Indebtedness.
53. CERTAIN DEFINITIONS. Unless the context clearly indicates a
contrary intent or unless otherwise specifically provided herein, words used in
this Mortgage shall be used interchangeably in singular or plural form. The word
"MORTGAGOR" shall mean Mortgagor and/or any subsequent owner or owners of the
Mortgaged Property or any part thereof or interest therein. The word "MORTGAGEE"
shall mean Mortgagee or any subsequent holder of the Note. The word "GUARANTY"
shall mean any Guaranty of Payment, Guaranty of Completion, Guaranty of
Collection, Environmental Indemnity or any other Guaranty or Indemnity given at
any time to or for the benefit of Mortgagee in connection with the Loan. The
word "GUARANTOR" shall mean any person giving or making any Guaranty. The word
"NOTE" shall mean the Note or any other evidence of indebtedness secured by this
Mortgage. The words "LOAN DOCUMENTS" shall mean the Note, this Mortgage, the
loan agreement, if any, between Mortgagor and Mortgagee, the security agreement,
if any, between Mortgagor and Mortgagee, the assignment of leases and rents, if
any, made by Mortgagor to Mortgagee, any reserve agreements between Mortgagor
and Mortgagee, any escrow agreements between Mortgagor and Mortgagee, the
assignment of contracts, if any, made by Mortgagor to Mortgagee, all Guaranties,
if any, made to Mortgagee, any other Mortgage or deed of trust securing the Note
and any other agreement, instrument, affidavit or document executed by
Mortgagor, any Guarantor or any indemnitor and delivered to Mortgagee in
connection with the Loan. The word "PERSON" shall include an individual,
corporation, partnership, trust, unincorporated association, government,
governmental authority or other entity. The words "MORTGAGED PROPERTY" shall
include any portion of the Mortgaged Property or interest therein. Whenever the
context may require, any pronouns used herein shall include the corresponding
masculine, feminine or neuter forms, and the singular form of nouns and pronouns
shall include the plural and vice versa.
54. NO ORAL CHANGE. This Mortgage, and any provisions hereof, may not
be modified, amended, waived, extended, changed, discharged or terminated orally
or by any act or failure to act on the part of Mortgagor or any one Mortgagor or
Mortgagee, but only by an agreement in writing signed by the party against whom
enforcement of any modification, amendment, waiver, extension, change, discharge
or termination is sought.
55. NO FOREIGN PERSON. Mortgagor is not a "foreign person" within the
meaning of Section 1445(f)(3) of the Internal Revenue Code of 1986, as amended
and the related Treasury Department Regulations, including temporary
regulations.
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Loan No. 6518291
56. SEPARATE TAX LOT. The Mortgaged Property is assessed for real
estate tax purposes as one or more wholly independent tax lot or lots, separate
from any adjoining land or improvements not constituting a part of such lot or
lots, and no other land or improvements is assessed and taxed together with the
Mortgaged Property or any portion thereof.
57. RIGHT TO RELEASE ANY PORTION OF THE MORTGAGED PROPERTY. Mortgagee
may release any portion of the Mortgaged Property for such consideration as
Mortgagee may require without, as to the remainder of the Mortgaged Property, in
any way impairing or affecting the lien or priority of this Mortgage, or
improving the position of any subordinate lienholder with respect thereto,
except to the extent that the obligations hereunder shall have been reduced by
the actual monetary consideration, if any, received by Mortgagee for such
release, and may accept by assignment, pledge or otherwise any other property in
place thereof as Mortgagee may require without being accountable for so doing to
any other lienholder. This Mortgage shall continue as a lien and security
interest in the remaining portion of the Mortgaged Property.
58. SUBROGATION. The Mortgagee shall be subrogated for further
security to the lien, although released of record, of any and all encumbrances
paid out of the proceeds of the Loan secured by this Mortgage.
59. ADMINISTRATIVE FEES. Mortgagee may charge reasonable
administrative fees and be reimbursed for all costs and expenses, including
reasonable attorneys' fees and disbursements, associated with reviewing and
processing post-closing requests of Mortgagor.
60. DISCLOSURE. Mortgagor represents and warrants that (a) it has
fully disclosed to Mortgagee all facts material to the Mortgaged Property and
the operation and tenants thereof, the Mortgagor, the Mortgagor's business
operations, any guarantor of Non-Recourse Carveout Obligations, any indemnitor
of environmental liabilities, and any other Guarantor and any principal of any
of them and the background, creditworthiness, financial condition and business
operations of each, (b) to Mortgagor's best knowledge, all material information
submitted in connection with this Loan is true, correct and complete, (c) to
Mortgagor's best knowledge, the financial and operating statements and other
accounting information submitted in connection with the Loan are true, correct,
complete, and fairly present the financial condition of the Mortgagor,
Guarantors and Indemnitors and their respective principals and have been
prepared consistent with proper accounting standards, and (d) there is no
litigation, action, claim, or other proceeding, pending or threatened which
might, in any way, materially and/or adversely affect the Applicant, Mortgagor,
any Guarantor, any Indemnitor or the principals of any of them, or the Mortgaged
Property, Mortgagee's lien thereon, or the financial condition of the Mortgaged
Property or any of the aforementioned persons; and a misrepresentation or breach
of any representation, warranty or covenant shall be an Event of Default under
the Loan Documents.
61. HEADINGS, ETC.. The headings and captions of various paragraphs
of this Mortgage are for convenience of reference only and are not to be
construed as defining or limiting, in any way, the scope or intent of the
provisions hereof.
62. ADDRESS OF REAL PROPERTY. The street address of the Real Property
is as follows: ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇.
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Loan No. 6518291
63. INTENTIONALLY DELETED.
64. PUBLICITY. Mortgagor agrees that Mortgagee, at its expense, may
publicize the financing of the Mortgaged Property in trade and similar
publications.
65. RELATIONSHIP. The relationship of Mortgagee to Mortgagor under
this Mortgage is strictly and solely that of lender and borrower and nothing
contained in this Mortgage or any other Loan Document is intended to create, or
shall in any event or under any circumstance be construed to create, a
partnership, joint venture, tenancy-in-common, joint tenancy or other
relationship of any nature whatsoever between Mortgagee and Mortgagor other than
that of lender and borrower.
66. HOMESTEAD. Mortgagor hereby waives and renounces all homestead
and exemption rights provided by the constitution and the laws of the United
States and of any state, in and to the Land as against the collection of the
Indebtedness, or any part hereof.
67. NO THIRD PARTY BENEFICIARIES. Nothing contained herein is
intended or shall be deemed to create or confer any rights upon any third person
not a party hereto, whether as a third-party beneficiary or otherwise, except as
expressly provided herein.
68. COMPLIANCE WITH REGULATION U. Mortgagor represents, warrants and
covenants that no part of the proceeds of the Loan will be used for the purpose
(whether immediate, incidental or ultimate) of buying or carrying any margin
stock within the meaning of Regulation U (12 CFR part 221) of the Board of
Governors of the Federal Reserve System of the United States or for the purpose
of reducing or retiring any indebtedness which was originally incurred for any
such purpose, or for any other purpose which might constitute this Loan a
"purpose credit" within the meaning of such Regulation U.
69. ENTIRE AGREEMENT. This Mortgage, the Note and the other Loan
Documents constitute the entire agreement among Mortgagor and Mortgagee with
respect to the subject matter hereof and all understandings, oral
representations and agreements heretofore or simultaneously had among the
parties are merged in, and are contained in, such documents and instruments.
70. SERVICER. Mortgagee may from time to time appoint a servicer (the
"SERVICER") to administer the Loan, which Servicer shall have the power and
authority to exercise all of the rights and remedies of Mortgagee and to act as
agent of Mortgagee hereunder.
71. GOVERNING LAW; CONSENT TO JURISDICTION. THIS MORTGAGE SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE IN WHICH THE
MORTGAGED PROPERTY IS LOCATED WITHOUT REGARD TO CONFLICT OF LAW PROVISIONS
THEREOF. EACH MORTGAGOR, ENDORSER AND GUARANTOR HEREBY SUBMITS TO PERSONAL
JURISDICTION IN SAID STATE AND THE FEDERAL COURTS OF THE UNITED STATES OF
AMERICA LOCATED IN SAID STATE (AND ANY APPELLATE COURTS TAKING APPEALS
THEREFROM) FOR THE ENFORCEMENT OF SUCH MORTGAGOR'S, ENDORSER'S OR GUARANTOR'S
OBLIGATIONS HEREUNDER, UNDER THE NOTE, THE GUARANTY AND THE OTHER
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Loan No. 6518291
LOAN DOCUMENTS, AND WAIVES ANY AND ALL PERSONAL RIGHTS UNDER THE LAW OF ANY
OTHER STATE TO OBJECT TO JURISDICTION WITHIN SUCH STATE FOR THE PURPOSES OF SUCH
ACTION, SUIT, PROCEEDING OR LITIGATION TO ENFORCE SUCH OBLIGATIONS OF SUCH
MORTGAGOR, ENDORSER OR GUARANTOR. EACH MORTGAGOR, ENDORSER AND GUARANTOR HEREBY
WAIVES AND AGREES NOT TO ASSERT, AS A DEFENSE IN ANY ACTION, SUIT OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS MORTGAGE, THE NOTE, ANY GUARANTY OR ANY OTHER
LOAN DOCUMENT, (A) THAT IT IS NOT SUBJECT TO SUCH JURISDICTION OR THAT SUCH
ACTION, SUIT OR PROCEEDING MAY NOT BE BROUGHT OR IS NOT MAINTAINABLE IN THOSE
COURTS OR THAT THIS MORTGAGE, THE NOTE, THE GUARANTY AND/OR ANY OF THE OTHER
LOAN DOCUMENTS MAY NOT BE ENFORCED IN OR BY THOSE COURTS OR THAT IT IS EXEMPT OR
IMMUNE FROM EXECUTION, (B) THAT THE ACTION, SUIT OR PROCEEDING IS BROUGHT IN AN
INCONVENIENT FORUM OR (C) THAT THE VENUE OF THE ACTION, SUIT OR PROCEEDING IS
IMPROPER. IN THE EVENT ANY SUCH ACTION, SUIT, PROCEEDING OR LITIGATION IS
COMMENCED, MORTGAGOR, ENDORSER AND GUARANTOR AGREE THAT SERVICE OF PROCESS MAY
BE MADE, AND PERSONAL JURISDICTION OVER SUCH MORTGAGOR, ENDORSER OR GUARANTOR
OBTAINED, BY SERVICE OF A COPY OF THE SUMMONS, COMPLAINT AND OTHER PLEADINGS
REQUIRED TO COMMENCE SUCH LITIGATION UPON SUCH MORTGAGOR, ENDORSER OR GUARANTOR
AT ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
72. PHASE II PROPERTY; AMENDMENT TO MORTGAGE. At the time of the
initial funding of the Loan, this Mortgage shall be and become a first lien upon
certain improved property containing approximately 350,994 net rentable square
feet of retail space and associated improvements which is legally described on
Exhibit A attached hereto and made a part hereof (the "Phase I Property").
Mortgagor and Mortgagee acknowledge that Mortgagor intends to acquire and
improve, but has not yet acquired nor improved, certain adjacent property which
will consist of approximately 35,900 net rentable square feet of retail space
and associated improvements to be located on certain real property adjacent and
contiguous to the Phase I Property (the "Phase II Property"). As further
security and collateral for the Loan, Mortgagor has delivered to Mortgagee a
letter of credit in the amount of Three Million Six Hundred Fifty Thousand and
No/100 Dollars ($3,650,000.00), and has entered into a certain Transitional
Security (Phase II) Reserve Agreement (the "Phase II Reserve Agreement"). Upon
satisfaction of the Transition Conditions set forth in the Phase II Reserve
Agreement, Mortgagor and Mortgagee agree to amend this Mortgage to include as
additional property to be subject to the lien of this Mortgage the Phase II
Property as so improved by Mortgagor. Upon satisfaction by Mortgagor of all of
the Transition Conditions set forth and defined in the Phase II Reserve
Agreement, and upon the recording of such amendment to this Mortgage subjecting
the Phase II Property to the lien of this Mortgage, Mortgagee shall thereafter
return to Mortgagor the letter of credit theretofore deposited with Mortgagee
pursuant to the Phase II Reserve Agreement.
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Loan No. 6518291
73. SPECIAL STATE PROVISIONS.
(a) In the event of any inconsistencies between the other paragraphs
of this Mortgage and this Paragraph 73, the terms and conditions of this
Paragraph 73 shall control and be binding.
(a) MATURITY DATE. The Maturity Date of the Note, unless renewed
or extended, is May 1, 2009.
(b) ATTORNEYS' FEES. In case the Note or this Mortgage or any
other Loan Document should be placed in the hands of an attorney at law for
collection or enforcement, Mortgagor agrees to pay all costs of collection or
enforcement including reasonable attorneys' fees.
(c) INTEREST BEFORE AND AFTER JUDGMENT. The Indebtedness
evidenced by the Note, all accrued and unpaid interest thereon and all other
sums evidenced and/or secured by the Loan Documents shall bear interest at the
Default Rate both before and after any judgment on the Indebtedness.
(d) FORECLOSURE. Upon the occurrence of an Event of Default, it
shall be lawful for the Mortgagee and the Mortgagee is hereby authorized and
empowered to foreclose this Mortgage under court action, and to cause to have
sold the Mortgaged Property, as an entirety or in separate lots or parcels,
without regard to principles of marshalling, at public auction for cash, after
having first complied with all applicable requirements of South Carolina law
with respect to the foreclosure of mortgages. Upon any foreclosure sale, the
Mortgagee may bid for and purchase the Mortgaged Property, and upon compliance
with the terms of sale, may hold, retain and possess and dispose of the
Mortgaged Property in its own absolute right in fee simple and without further
accountability. Any foreclosure sale may at the Mortgagee's sole option either
include or exclude any portion of the Mortgaged Property which is subject to the
Uniform Commercial Code (which portion, if excluded, shall be subject to such
other rights and remedies as are set forth herein) with any such sale(s) to be
under the judgment or decree of a Court of competent jurisdiction. The Mortgagee
shall further, at its option, be authorized to foreclose this Mortgage subject
to the rights of any tenants of the Mortgaged Property, and the failure to name
any such tenants as parties defendant to any such foreclosure proceedings and to
foreclose their rights ▇▇▇▇ not be, nor asserted by the Mortgagor or any other
persons to be, a defense to any proceedings instituted by the Mortgagee to
collect the sums secured hereby. The Mortgagee shall have the right to credit
the amount of its bid, should it be the successful bidder on the Mortgaged
Property or any portion thereof, upon the unpaid outstanding amount of the
Indebtedness secured hereby in lieu of a cash payment therefor.
(e) NOTICE OF ACCELERATION. ALL NOTICE OF THE EXERCISE OF THE
OPTION BY MORTGAGEE TO ACCELERATE THE INDEBTEDNESS UPON THE OCCURRENCE OF AN
EVENT OF DEFAULT IS EXPRESSLY WAIVED, EXCEPT TO THE EXTENT OTHERWISE EXPRESSLY
SET FORTH HEREIN.
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Loan No. 6518291
(f) MORTGAGE AS FINANCING STATEMENT. As to those items of
personal property which are or are to become affixed to the Land and/or the
Improvements, and all products and proceeds thereof, this Mortgage is and shall
be effective as a Financing Statement filed as a fixture filing as and from the
date of its recordation in the real estate records of the County in which the
Land is situated. The name of the record owner of the Land and Improvements is
the Mortgagor identified on the first page of this Mortgage. The name and
address of the Mortgagor, as debtor, is set forth on the first page of this
Mortgage. The name and address of the Mortgagee, as secured party, and from whom
information concerning the security interest created herein may be obtained, is
set forth on the first page of this Mortgage. The provisions set forth on pages
1 through 4 of this Mortgage describe the types and items of the personal
property affixed or to be affixed to the Land and the Improvements.
(g) FUTURE ADVANCES. Pursuant to the provisions of Section
29-3-50 et seq. of the Code of Laws of South Carolina, 1976, as amended, the
lien of this Mortgage may secure future advances and readvances that may be made
to Mortgagor by Mortgagee evidenced by the Note, or any other promissory notes,
and all renewals or extensions of the Note or any other promissory notes, which
future advances shall not exceed more than 200% times the original principal
amount of the Note, plus interest thereon, all charges and expenses of
collection incurred by Mortgagee and any other sums advanced by Mortgagee under
this Mortgage to protect the Mortgagee's interest in the Mortgaged Property. In
addition, this Mortgage may secure interest which is deferred, accrued or
capitalized, as provided in the aforesaid Statute.
(h) WAIVER OF APPRAISAL RIGHTS. The laws of South Carolina provide
that in any real estate foreclosure proceeding a defendant against whom a
personal judgment is taken or asked may within thirty days after the sale of the
Mortgaged Property apply to the court for an order of appraisal. The statutory
appraisal value as approved by the court would be substituted for the high bid
and may decrease the amount of any deficiency owing in connection with the
transaction. THE UNDERSIGNED HEREBY WAIVES AND RELINQUISHES THE STATUTORY
APPRAISAL RIGHTS WHICH MEANS THE HIGH BID AT THE JUDICIAL FORECLOSURE SALE WILL
BE APPLIED TO THE DEBT REGARDLESS OF ANY APPRAISED VALUE OF THE MORTGAGED
PROPERTY. The placement of this paragraph on this page is to comply with the
laws of the State of South Carolina which require the waiver of appraisal rights
to appear on all signature pages. It is intended by the undersigned that all
provisions of the attached Mortgage be incorporated herein.
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Loan No. 6518291
IN WITNESS WHEREOF, Mortgagor has duly executed and delivered this Mortgage
as of the day and year first above written.
MORTGAGOR:
INLAND WESTERN SPARTANBURG, L.L.C.,
a Delaware limited liability company
By: Inland Western Spartanburg SPE, L.L.C., a
Delaware limited liability company, its
Sole Member
By: Inland Western Retail Real Estate
Trust, Inc., a Maryland corporation,
its Sole Member
Signed, sealed and delivered
in the presence of:
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------- ------------------------------
Name: Title: Asst. Secretary
-----------------------------
/s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------
Name:
[SIGNATURE PAGE TO
MORTGAGE, ASSIGNMENT OF LEASES AND RENTS AND SECURITY
AGREEMENT]
- 56 -
Loan ▇▇. ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ OF DuPage
PERSONALLY appeared before me the undersigned witness, who, being duly
sworn, says that (s)he saw ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Asst. Secretary of Inland Western
Retail Real Estate Trust, Inc., a Maryland corporation, which is the Sole Member
of Inland Western Spartanburg SPE, L.L.C., a Delaware limited liability company,
which is the Sole Member of Inland Western Spartanburg, L.L.C., a Delaware
limited liability company (the "Company"), sign, seal and as his/her act and
deed, and as the act and deed of the Company, deliver the foregoing instrument,
and that (s)he with the other witness named above witnessed the execution and
delivery thereof as the act and deed of the said Company.
SWORN to before me this 12th /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
day of April, 2004. -------------------------------
(Signature of Witness)
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ (SEAL)
Notary Public,
State of Illinois
My commission expires:____________
OFFICIAL SEAL
▇▇▇▇▇ ▇ ▇▇▇▇▇▇▇▇
NOTARY PUBLIC, STATE OF ILLINOIS
MY COMMISSION EXPIRES: 06/30/04
STATE OF ILLINOIS
COUNTY OF DuPage
PERSONALLY appeared before me the undersigned witness, who, being duly
sworn, says that (s)he saw ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Asst. Secretary of Inland Western
Retail Real Estate Trust, Inc., a Maryland corporation, which is the Sole Member
of Inland Western Spartanburg SPE, L.L.C., a Delaware limited liability company,
which is the Sole Member of Inland Western Spartanburg, L.L.C., a Delaware
limited liability company (the "Company"), sign, seal and as his/her act and
deed, and as the act and deed of the Company, deliver the foregoing instrument,
and that (s)he with the other witness named above witnessed the execution and
delivery thereof as the act and deed of the said Company.
SWORN to before me this 12th /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
day of April, 2004. -------------------------------
(Signature of Witness)
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ (SEAL)
Notary Public
State of Illinois
My commission expires: ___________
OFFICIAL SEAL
▇▇▇▇▇ ▇ ▇▇▇▇▇▇▇▇
NOTARY PUBLIC, STATE OF ILLINOIS
MY COMMISSION EXPIRES: 06/30/04
[ACKNOWLEDGEMENT PAGE TO
MORTGAGE, ASSIGNMENT OF LEASES AND RENTS AND SECURITY
AGREEMENT]
- 57 -
Loan No. 6518291
EXHIBIT A
DESCRIPTION OF LAND
WAL-MART TRACT
All that certain piece, parcel or lot of land lying and being in Spartanburg
County, State of South Carolina, being shown and designated on an ALTA/ASCM Land
Title Survey for Inland Western Spartanburg, L.L.C., ▇▇▇▇▇▇ Centre, Phase I, by
▇▇▇▇▇▇▇▇ & Associates, Inc., dated January 19, 2004, last revised March 3, 2004,
and having the following metes and bounds to wit:
Commencing at an iron pin on the southern right-of-way of W.O. ▇▇▇▇▇ Boulevard
(US 29, 75' right-of-way from centerline), said iron pin being located
approximately 269 feet in a southwesterly direction from Westchester Place and
being the most northwesterly corner of ▇▇▇▇ Road Land Associates, LLC; thence
leaving said right-of-way along the common line of ▇▇▇▇ Road Land Associates,
LLC S 04-58-26 E for 197.42 feet to an iron pin; thence along the common line of
▇▇▇▇ Road Land Associates, LLC and Camelot 1 Subdivision S 04-58-26 E for 637.89
feet to an iron pin being the POINT OF BEGINNING; thence continuing along the
common line of Camelot 1 Subdivision S 04-58-26 E for 946.57 feet to a concrete
monument found; thence along the common line of Camelot III-A Subdivision S
50-54-40 W for 710.29 feet to an iron pin; thence along the common line of
▇▇▇▇▇▇▇▇▇ ▇ (▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇ - ▇▇▇▇▇ 2) N 04-58-26 W for 247.73 feet to an
iron pin; thence along the common line of Outparcel 6 and Outparcel 5 N 48-14-23
W for 696.83 feet to an iron pin; thence along the common line of Out Parcel 2
the following courses and distances: N 00-15-30 W for 25.94 feet to an iron pin;
thence N 44-09-51 W for 78.09 feet to an iron pin; thence N 29-43-08 W for
118.42 feet to an iron pin; thence N 79-48-01 W for 19.80 feet to an iron pin on
the eastern right-of-way of ▇▇▇▇▇▇ Centre Drive (variable width right-of-way);
thence along said eastern right-of-way the following courses and distances: N
41-25-14 E for 73.72 feet to an iron pin; thence N 27-50-30 E for 49.89 feet to
an iron pin; thence N 41-45-37 E for 79.85 feet to an iron pin; thence with a
curve to the right having a radius of 438.50 feet, an arc length of 96.08 feet
and a chord bearing and distance of N 48-02-15 E for 95.89 feet to an iron pin;
thence with a curve to the left having a radius of 347.50 feet, an arc length of
129.44 feet and a chord bearing and distance of N 43-38-36 E for 128.69 feet to
a PK nail; thence leaving said right-of-way along the common line of Shops Tract
2 S 61-04-39 E for 53.90 feet to a PK nail; thence N 85-00-00 E for 141.35 feet
to a PK nail; thence S 04-58-26 E for 33.69 feet to a PK nail; thence N 85-01-34
E for 167.60 feet to a PK nail; thence S 04-58-26 E for 15.60 feet to a PK nail;
thence N 85-01-34 E for 116.75 feet to a point at a building corner; thence N
04-58-26 W for 34.08 feet to a point on the building line of Shops Tract 2;
thence N 85-01-34 E for 90.83 feet to a PK nail; thence N 04-58-26 W for 117.28
feet to a PK nail; thence along the common line of Home Depot USA, Inc. N
85-01-34 E for 123.55 feet to a PK nail; thence N 47-05-16 E for 46.10 feet to a
PK nail; thence N 85-01-34 E for 148.64 feet to an iron pin being the Point of
Beginning. Said tract contains 22.217 acres or 967,776 square feet more or less.
Exhibit A-l
Loan No. 6518291
TMS No. 6-21-05-001.04
SHOPS TRACT 1
All that certain piece, parcel or lot of land lying and being in Spartanburg
County, State of South Carolina, being shown and designated on an ALTA/ASCM Land
Title Survey for Inland Western Spartanburg, L.L.C., ▇▇▇▇▇▇ Centre, Phase I, by
▇▇▇▇▇▇▇▇ & Associates, Inc., dated January 19, 2004, last revised March 3, 2004
and having the following metes and bounds to wit:
Beginning at an iron pin on the southern right-of-way of W.O. ▇▇▇▇▇ Boulevard
(US 29, 75' right-of-way from centerline), said iron pin being located
approximately 269 feet in a southwesterly direction from Westchester Place and
being the most northwesterly corner of ▇▇▇▇ Road Land Associates, LLC; thence
leaving said right-of-way along the common line of ▇▇▇▇ Road Land Associates,
LLC S 04-58-26 E for 197.42 feet to an iron pin; thence along the common line of
Home Depot USA, Inc. S 85-01-34 W for 373.46 feet to a PK nail; thence N
04-58-26 W for 38.00 feet to a PK nail; thence S 85-01-34 W for 302.49 feet to
an iron pin on the eastern right-of-way of the ▇▇▇▇▇▇ Centre Drive (variable
width right-of-way); thence along said eastern right-of-way with a curve to the
left having a radius of 897.50 feet, an arc length of 131.60 feet and a chord
bearing and distance of N 00-46-51 W for 131.49 feet to an iron pin; thence N
04-58-26 W 29.00 feet to an iron pin at the intersection of said eastern
right-of-way with the southern right-of-way of W.O. ▇▇▇▇▇ Boulevard; thence
along said southern right-of-way N 85-05-19 E for 666.34 feet to an iron pin
being the Point of Beginning. Said tract contains 2.774 acres or 120,842 square
feet more or less.
TMS No. 6-21-05-001.02
SHOPS TRACT 2
All that certain piece, parcel or lot of land lying and being in Spartanburg
County, State of South Carolina, being shown and designated on an ALTA/ASCM Land
Title Survey for Inland Western Spartanburg, L.L.C., ▇▇▇▇▇▇ Centre, Phase I, by
▇▇▇▇▇▇▇▇ & Associates, Inc., dated January 19, 2004, last revised March 3, 2004,
and having the following metes and bounds to wit:
Commencing at an iron pin on the southern right-of-way of W.O. ▇▇▇▇▇ Boulevard
(US 29, 75' right-of-way from centerline), said iron pin being located
approximately 269 feet in a southwesterly direction from Westchester Place and
being the most northwesterly corner of ▇▇▇▇ Road Land Associates, LLC; thence
leaving said right-of-way along the common line of ▇▇▇▇ Road Land Associates,
LLC S 04-58-26 E for 197.42 feet to an iron pin; thence along the common line of
▇▇▇▇ Road Land Associates, LLC and Camelot 1 Subdivision S 04-58-26 E for
637.89 feet to an iron pin; thence along the common line of the Wal-Mart Tract S
85-01-34 W for 148.64 feet to a PK nail; thence S 47-05-16 W for 46.10 feet to a
PK nail; thence S 85-01-34 W for 123.55 feet to a PK nail being the POINT OF
BEGINNING; thence continuing along the common line of the Wal-Mart Tract S
04-58-26 E for 117.28 feet to a PK nail; thence S 85-01-34 W for 90.83 feet to a
point on the building line; thence S 04-58-26 E for 34.08 feet to a point being
a building corner; thence S 85-01-34 W for 116.75 feet to a PK nail; thence N
04-58-26 W for 15.60 feet to a PK nail; thence S 85-01-34 W for 167.60 feet to a
PK nail; thence N 04-58-26
Exhibit A-2
Loan No. 6518291
W for 33.69 feet to a PK nail; thence S 85-00-00 W for 141.35 feet to a PK nail;
thence N 61-04-39 W for 53.90 feet to a PK nail on the eastern right-of-way of
▇▇▇▇▇▇ Centre Drive (variable width right-of-way); thence along said eastern
right-of-way with a curve to the left having a radius of 347.50 feet, an arc
length of 60.08 feet and a chord bearing and distance of N 28-01-09 E for 60.01
feet to an iron pin; thence leaving said eastern right-of-way along the common
line of Home Depot USA, Inc. S 61-04-39 E for 14.36 feet to an iron pin; thence
S 41-54-43 E for 47.58 feet to an iron pin; thence N 85-01-34 E for 187.25 feet
to a PK nail; thence N 04-58-26 W for 63.03 feet to a PK nail; thence N 85-01-34
E for 115.89 feet to an iron pin; thence N 04-58-26 W for 4.76 feet to an iron
pin; thence N 85-01-34 E for 184.94 feet to a PK nail being the Point of
Beginning. Said tract contains 1.214 acres or 52,875 square feet more or less.
TMS No. 6-21-05-001.03
SHOPS TRACT 3
All that certain piece, parcel or lot of land lying and being in Spartanburg
County, State of South Carolina, being shown and designated on an ALTA/ASCM Land
Title Survey for Inland Western Spartanburg, L.L.C., ▇▇▇▇▇▇ Centre, Phase I, by
▇▇▇▇▇▇▇▇ & Associates, Inc., dated January 19, 2004, last revised March 3, 2004,
and having the following metes and bounds to wit:
Beginning at an iron pin found on the eastern right-of-way of East ▇▇▇▇▇▇▇▇▇▇
Road (SC 215), said iron pin being the most southwesterly corner of ▇▇▇▇▇▇▇
(Plat Book 30, page 357); thence leaving said right-of-way along the common line
of ▇▇▇▇▇▇▇ N 43-52-15 E for 144.59 feet to an iron pin; thence along the common
line of ▇▇▇▇▇, ▇▇▇▇▇ (Quincy's, Plat Book 88, page 687), Conn (Plat Book 71,
page 16) and ▇▇▇▇▇▇▇ N 01-25-58 W for 711.35 feet to an iron pin; thence along
the common line of ▇▇▇▇▇▇▇ S 79-19-11 W for 232.84 feet to an iron pin on the
eastern right-of-way of East ▇▇▇▇▇▇▇▇▇▇ Road (SC 215); thence along said
right-of-way N 10-42-30 W for 49.72 feet to an iron pin; thence leaving said
right-of-way along the common line of ▇▇▇▇▇▇ Drive, LLC (Plat Book 81, page 135)
N 79-11-51 E for 240.75 feet to an iron pin; thence along the common line of
▇▇▇▇▇▇ Drive LLC, P.H. Properties (Plat Book 71, page 16) and Sylwn Partnership
(Plat Book 71, page 16) N 01-27-56 W for 389.60 feet to an iron pin; thence
along the common line of Yeoman's N 73-44-44 E for 233.51 feet to an iron pin;
thence along the common line of C&T Investment, Inc. N 73-50-42 E for 155.49
feet to a concrete monument found; thence along the common line of Out Parcel #1
(Tenant Development Group, LLC S 04-58-26 E for 67.46 feet to an iron pin;
thence N 85-01-34 E for 292.16 feet to an iron pin on the western right-of-way
of ▇▇▇▇▇▇ Centre Drive (variable width right-of-way); thence along said western
right-of-way S 04-58-26 E for 101.80 feet to an iron pin; thence S 04-47-10 W
for 281.57 feet to an iron pin; thence S 05-01-22 E for 79.74 feet to an iron
pin; thence with a curve to the right having a radius of 288.50 feet, an arc
length of 284.69 feet and a chord bearing and distance of S 26-02-42 W for
273.28 feet to an iron pin; thence with a curve to the left having a radius of
497.50 feet, an arc length of 109.01 feet and a chord bearing and distance of S
48-02-15 W for 108.79 feet to an iron pin; thence S 41-45-37 W for 502.12 feet
to an iron pin; thence with a curve to the left having a radius of 519.47 feet,
an arc length of 156.11 feet and a chord bearing and distance of S 26-56-56 W
for 155.52 feet to an iron pin; thence with a curve to the right having a radius
of 88.50 feet, an arc length of 103.83 feet and a chord bearing and distance of
S 51-24-53 W for 97.98 feet to an iron pin; thence S 85-01-34 W for 44.71 feet
to a PK nail on the
Exhibit A-3
Loan No. 6518291
eastern right-of-way of East ▇▇▇▇▇▇▇▇▇▇ Road (SC 215); thence along said eastern
right-of-way N 10-43-46 W for 36.10 feet to an iron pin being the Point of
Beginning. Said tract contains 14.105 acres or 614,396 square feet more or less.
TMS No. 6-21-05-001.07
ALSO, all real property rights, including, but not limited to, rights of
ingress, egress, access and parking arising and under the following instruments:
A) Amended and Supplemented Covenants regarding Tenant Uses, dated
February 19, 2004, recorded in Deed Book 79-T at page 191, Spartanburg
County records; and
B) Covenants Regarding Tenant Uses dated January 31, 2004, recorded March
1, 2004 in Deed Book 79-U at page 446, Spartanburg County records.
C) Easements and Covenants with Restrictions Affecting Land dated
November 1, 2002, and recorded in Deed Book 76-T at page 610,
Spartanburg County records.
D) First Amendment to Easement with Covenants and Restrictions Affecting
Land dated November 6, 2003, and recorded in Deed Book 79-B at page
911, Spartanburg County records.
Exhibit A-4
Loan No. 6518291
EXHIBIT B
MORTGAGE NOTE