Exhibit
4.7
THIRD PARTY
OPEN-END MORTGAGE
AND ASSIGNMENT OF RENTS AND
LEASES
Total Indebtedness Not to Exceed
$3,250,000
THIS THIRD PARTY OPEN-END MORTGAGE AND
ASSIGNMENT (this “Mortgage”) is executed as of, 2008 by
MOUND TECHNOLOGIES, INC., a Nevada corporation
(“Mortgagor”), to CHOICE FINANCIAL GROUP, a
North Dakota state bank (“Mortgagee”).
ARTICLE I.
MORTGAGE
1.1 Grant. For the purposes and upon the
terms and conditions in this Mortgage, Mortgagor irrevocably
mortgages, grants, conveys and assigns to Mortgagee, with the right
of entry and possession, Mortgagor’s interest in: (a) all
real property located in
County, Ohio, and described on Exhibit A
attached hereto; (b) all easements, rights-of-way and rights used
in connection with or as a means of access to any portion of said
real property; (c) all tenements, hereditaments and appurtenances
thereof and thereto; (d) all right, title and interest of
Mortgagor, now owned or hereafter acquired, in and to any land
lying within the right-of-way of any street, open or proposed,
adjoining said real property, and any and all sidewalks, alleys and
strips and gores of land adjacent to or used in connection with
said real property; (e) all buildings, improvements and landscaping
now or hereafter erected or located on said real property; (f) all
development rights, governmental or quasi-governmental licenses,
permits or approvals, zoning rights and other similar rights or
interests which relate to the development, use or operation of, or
that benefit or are appurtenant to, said real property; (g) all
mineral rights, oil and gas rights, air rights, water or water
rights, including without limitation, all wells, canals, ditches
and reservoirs of any nature and all rights thereto, appurtenant to
or associated with said real property, whether decreed or
undecreed, tributary or non-tributary, surface or underground,
appropriated or unappropriated, and all shares of stock in any
water, canal, ditch or reservoir company, and all well permits,
water service contracts, drainage rights and other evidences of any
such rights; and (h) all interest or estate which Mortgagor now has
or may hereafter acquire in said real property and all additions
and accretions thereto, and all awards or payments made for the
taking of all or any portion of said real property by eminent
domain or any proceeding or purchase in lieu thereof, or any damage
to any portion of said real property (collectively, the
“Subject Property”). The listing of specific rights or
property shall not be interpreted as a limitation of general
terms.
1.2 Address. The address of the Subject
Property (if known) is: 25 Mound Park Drive, Springboro, Ohio
45066. Neither the failure to designate an address nor any
inaccuracy in the address designated shall affect the validity or
priority of the lien of this Mortgage on the Subject Property as
described on Exhibit A. In the event of any conflict between
the provisions of Exhibit A and said address, Exhibit
A shall control.
ARTICLE II. OBLIGATIONS
SECURED
2.1 Obligations Secured. Mortgagor makes
this grant and assignment for the purpose of securing the following
obligations (each, a “Secured Obligation” and
collectively, the “Secured Obligations”):
(a) payment to
Mortgagee of all sums at any time owing and performance of all
other obligations arising under or in connection with that certain
Promissory Note (“Note”) dated as of the same date as
this Mortgage, in the maximum principal amount of Three Million Two
Hundred Fifty Thousand and 00/100 Dollars ($3,250,000), with
interest as provided therein, executed by HEARTLAND, INC., a
Maryland corporation (“Borrower”), and payable to
Mortgagee or its order, together with the payment and performance
of any other indebtedness or obligations incurred in connection
with the credit accommodation evidenced by the Note, whether or not
specifically referenced therein; and
(b) payment and
performance of all obligations of Mortgagor under this Mortgage,
together with all advances, payments or other expenditures made by
Mortgagee as or for the payment or performance of any such
obligations of Mortgagor; and
(c) payment and
performance of all obligations, if any, and the contracts under
which they arise, which any rider attached to and recorded with
this Mortgage recites are secured hereby; and
(d) payment to
Mortgagee of all liability, whether liquidated or unliquidated,
defined, contingent, conditional or of any other nature whatsoever,
and performance of all other obligations, arising under any swap,
derivative, foreign exchange or hedge transaction or arrangement
(or other similar transaction or arrangement howsoever described or
defined) at any time entered into with Mortgagee in connection with
any Secured Obligation; and
(e) payment and
performance of all future advances and other obligations that
Borrower and/or the then record owner of the Subject Property may
agree to pay and/or perform (whether as principal, surety or
guarantor) for the benefit of Mortgagee, when any such advance or
other obligation is evidenced by a writing which recites that it is
secured by this Mortgage; and
(f) pursuant to the
provisions of Ohio Revised Code §5301.232, all unpaid balances
of loan advances or future advances made by the holder of this
Mortgage at the request of Borrower or Mortgagor or their
successors in title after this Mortgage is delivered to the
recorder for recording to the extent that such unpaid balances or
future advances in the aggregate and exclusive of interest accrued
thereon do not exceed the maximum amount of $3,250,000 at any time;
and
(g) pursuant to the provisions of
Ohio Revised Code §5301.233, all unpaid balances of advances
made with respect to the Subject Property after the Mortgage is
delivered to the recorder for recording for the payment of taxes,
assessments, insurance premiums, or costs incurred for the
protection of the Subject Property; and
(h) all modifications, extensions and renewals
of any of the Secured Obligations (including without limitation,
(i) modifications, extensions or renewals at a different rate of
interest, or (ii) deferrals or accelerations of the required
principal payment dates or interest payment dates or both, in whole
or in part), however evidenced, whether or not any such
modification, extension or renewal is evidenced by a new or
additional promissory note or notes.
2.2 Obligations. The term
“obligations” is used herein in its most comprehensive
sense and includes any and all advances, debts, obligations and
liabilities heretofore, now or hereafter made, incurred or created,
whether voluntary or involuntary and however arising, whether due
or not due, absolute or contingent, liquidated or unliquidated,
determined or undetermined, joint or several, including without
limitation, all principal, interest, charges, including prepayment
charges and late charges, and loan fees at any time accruing or
assessed on any Secured Obligation.
2.3 Incorporation. All terms of the
Secured Obligations are incorporated herein by this reference. All
persons who may have or acquire an interest in the Subject Property
are hereby deemed to have notice of the terms of the Secured
Obligations and to have notice, if provided therein, that: (a) the
Note or any other Secured Obligation may permit borrowing,
repayment and reborrowing; and (b) the rate of interest on one or
more of the Secured Obligations may vary from time to
time.
ARTICLE III. ASSIGNMENT OF
RENTS
3.1 Assignment. For the purposes and upon
the terms and conditions set forth herein, Mortgagor irrevocably
assigns to Mortgagee all of Mortgagor’s right, title and
interest in, to and under all leases, licenses, rental agreements
and other agreements of any kind relating to the use or occupancy
of any of the Subject Property, whether existing as of the date
hereof or at any time hereafter entered into, together with all
guarantees of and security for any tenant’s or lessee’s
performance thereunder, and all amendments, extensions, renewals
and modifications thereto (each, a “Lease” and
collectively, the “Leases”), together with any and all
other rents, issues and profits of the Subject Property
(collectively, “Rents”). This assignment shall not
impose upon Mortgagee any duty to produce Rents from the Subject
Property, nor cause Mortgagee to be: (a) a “mortgagee in
possession” for any purpose; (b) responsible for performing
any of the obligations of the lessor or landlord under any Lease;
or (c) responsible for any waste committed by any person or entity
at any time in possession of the Subject Property or any part
thereof, or for any dangerous or defective condition of the Subject
Property, or for any negligence in the management, upkeep, repair
or control of the Subject Property. This is an absolute assignment,
not an assignment for security only, and Mortgagee’s right to
Rents is not contingent upon and may be exercised without taking
possession of the Subject Property. Mortgagor agrees to execute and
deliver to Mortgagee, within five (5) days of Mortgagee’s
written request, such additional documents as Mortgagee may
reasonably request to further evidence the assignment to Mortgagee
of any and all Leases and Rents. Mortgagee, at Mortgagee’s
option and without notice, may notify any lessee or tenant of this
assignment of the Leases and Rents.
3.2 Protection of Security. To protect
the security of this assignment, Mortgagor agrees:
(a) At Mortgagor’s sole cost and expense:
(i) to perform each obligation to be performed by the lessor or
landlord under each Lease and to enforce or secure the performance
of each obligation to be performed by the lessee or tenant under
each Lease; (ii) not to modify any Lease in any material respect,
nor accept surrender under or terminate the term of any Lease;
(iii) not to anticipate the Rents under any Lease; and (iv) not to
waive or release any lessee or tenant of or from any Lease
obligations. Mortgagor assigns to Mortgagee all of
Mortgagor’s right and power to modify the terms of any Lease,
to accept a surrender under or terminate the term of or anticipate
the Rents under any Lease, and to waive or release any lessee or
tenant of or from any Lease obligations, and any attempt on the
part of Mortgagor to exercise any such rights or powers without
Mortgagee’s prior written consent shall be a breach of the
terms hereof.
(b) At
Mortgagor’s sole cost and expense, to defend any action in
any manner connected with any Lease or the obligations thereunder,
and to pay all costs of Mortgagee, including reasonable
attorneys’ fees, in any such action in which Mortgagee may
appear.
(c) That, should
Mortgagor fail to do any act required to be done by Mortgagor under
a Lease, then Mortgagee may, but without obligation to do so and
without notice to Mortgagor and without releasing Mortgagor from
any obligation hereunder, make or do the same in such manner and to
such extent as Mortgagee deems necessary to protect the security
hereof, and, in exercising such powers, Mortgagee may employ
attorneys and other agents, and Mortgagor shall pay necessary costs
and reasonable attorneys’ fees incurred by Mortgagee, or its
agents, in the exercise of the powers granted herein. Mortgagor
shall give prompt notice to Mortgagee of any default by any lessee
or tenant under any Lease, and of any notice of default on the part
of Mortgagor under any Lease received from a lessee or tenant
thereunder, together with an accurate and complete copy
thereof.
(d) To pay to Mortgagee immediately
upon demand all sums expended under the authority hereof, including
reasonable attorneys’ fees, together with interest thereon at
the highest rate per annum payable under any Secured Obligation,
and the same, at Mortgagee’s option, may be added to any
Secured Obligation and shall be secured hereby.
3.3 License. Mortgagee
confers upon Mortgagor a license (“License”) to collect
and retain the Rents as, but not before, they come due and payable,
until the occurrence of any Default. Upon the occurrence of any
Default, the License shall be automatically revoked, and Mortgagee
may, at Mortgagee’s option and without notice, either in
person or by agent, with or without bringing any action, or by a
receiver to be appointed by a court: (a) enter, take possession of,
manage and operate the Subject Property or any part thereof; (b)
make, cancel, enforce or modify any Lease; (c) obtain and evict
tenants, fix or modify Rents, and do any acts which Mortgagee deems
proper to protect the security hereof; and (d) either with or
without taking possession of the Subject Property, in its own name,
sue for or otherwise collect and receive all Rents, including those
past due and unpaid, and apply the same in accordance with the
provisions of this Mortgage. The entering and taking possession of
the Subject Property, the collection of Rents and the application
thereof as aforesaid, shall not cure or waive any Default, nor
waive, modify or affect any notice of default hereunder, nor
invalidate any act done pursuant to any such notice. The License
shall not grant to Mortgagee the right to possession, except as
provided in this Mortgage.
ARTICLE IV. RIGHTS AND DUTIES OF
THE PARTIES
4.1 Title. Mortgagor warrants that,
except as disclosed to Mortgagee prior to the date hereof in a
writing which refers to this warranty, Mortgagor lawfully possesses
and holds fee simple title to, or if permitted by Mortgagee in
writing, a leasehold interest in, the Subject Property without
limitation on the right to encumber, as herein provided, and that
this Mortgage is a valid lien on the Subject Property and all of
Mortgagor’s interest therein.
4.2 Taxes and Assessments. Subject to the
right, if any, of Mortgagor to contest payment of the following
pursuant to any other agreement between Mortgagor and Mortgagee,
Mortgagor shall pay prior to delinquency all taxes, assessments,
levies and charges imposed: (a) by any public or
quasi-public authority which are or which may become a lien upon or
cause a loss in value of the Subject Property or any interest
therein; or (b) by any public authority upon Mortgagee by reason of
its interest in any Secured Obligation or in the Subject Property,
or by reason of any payment made to Mortgagee pursuant to any
Secured Obligation; provided however, that Mortgagor shall have no
obligation to pay any income taxes of Mortgagee. Promptly upon
request by Mortgagee, Mortgagor shall furnish to Mortgagee
satisfactory evidence of the payment of all of the foregoing.
Mortgagee is hereby authorized to request and receive from the
responsible governmental and non-governmental personnel written
statements with respect to the accrual and payment of any of the
foregoing.
4.3 Performance of Secured Obligations.
If not paid and performed by Borrower, Mortgagor shall promptly pay
and perform each Secured Obligation when due.
4.4 Liens, Encumbrances and Charges.
Mortgagor shall immediately discharge any lien on the Subject
Property not approved by Mortgagee in writing. Except as otherwise
provided in any Secured Obligation or other agreement with
Mortgagee, Mortgagor shall pay when due all obligations secured by
or reducible to liens and encumbrances which shall now or hereafter
encumber the Subject Property, whether senior or subordinate
hereto, including without limitation, any mechanics’
liens.
4.5 Insurance. Mortgagor shall insure the
Subject Property against loss or damage by fire and such other
risks as Mortgagee shall from time to time require. Mortgagor shall
carry public liability insurance, flood insurance as required by
applicable law and such other insurance as Mortgagee may reasonably
require, including without limitation, business interruption
insurance or loss of rental value insurance. Mortgagor shall
maintain all required insurance at Mortgagor’s expense, under
policies issued by companies and in form and substance satisfactory
to Mortgagee. Mortgagee, by reason of accepting, rejecting,
approving or obtaining insurance, shall not incur any liability
for: (a) the existence, nonexistence, form or legal sufficiency
thereof; (b) the solvency of
any insurer; or (c) the payment of losses. All policies and
certificates of insurance shall name Mortgagee as loss payee, and
shall provide that the insurance cannot be terminated as to
Mortgagee except upon a minimum of ten (10) days’ prior
written notice to Mortgagee. Immediately upon any request by
Mortgagee, Mortgagor shall deliver to Mortgagee the original of all
such policies or certificates, with receipts evidencing annual
prepayment of the premiums.
4.6 Tax and Insurance Impounds. At
Mortgagee’s option and upon its demand, Mortgagor shall,
until all Secured Obligations have been paid in full, pay to
Mortgagee monthly, annually or as otherwise directed by Mortgagee
an amount estimated by Mortgagee to be equal to: (a) all taxes,
assessments, levies and charges imposed by any public or
quasi-public authority which are or may become a lien upon the
Subject Property and will become due for the tax year during which
such payment is so directed; and (b) premiums for fire, other
hazard and mortgage insurance next due. If Mortgagee determines
that amounts paid by Mortgagor are insufficient for the payment in
full of such taxes, assessments, levies and/or insurance premiums,
Mortgagee shall notify Mortgagor of the increased amount required
for the payment thereof when due, and Mortgagor shall pay to
Mortgagee such additional amount within thirty (30) days after
notice from Mortgagee. All amounts so paid shall not bear interest,
except to the extent and in the amount required by law. So long as
there is no Default, Mortgagee shall apply said amounts to the
payment of, or at Mortgagee’s sole option release said funds
to Mortgagor for application to and payment of, such taxes,
assessments, levies, charges and insurance premiums. If a Default
exists, Mortgagee at its sole option may apply all or any part of
said amounts to any Secured Obligation and/or to cure such Default,
in which event Mortgagor shall be required to restore all amounts
so applied, as well as to cure any Default not cured by such
application. Mortgagor hereby grants and transfers to Mortgagee a
security interest in all amounts so paid and held in
Mortgagee’s possession, and all proceeds thereof, to secure
the payment and performance of each Secured Obligation. Upon
assignment of this Mortgage, Mortgagee shall have the right to
assign all amounts collected and in its possession to its assignee,
whereupon Mortgagee shall be released from all liability with
respect thereto. The existence of said impounds shall not limit
Mortgagee’s rights under any other provision of this Mortgage
or any other agreement, statute or rule of law. Within ninety-five
(95) days following full repayment of all Secured Obligations
(other than as a consequence of a foreclosure or conveyance in lieu
of foreclosure of the liens and security interests securing any
Secured Obligation), or at such earlier time as Mortgagee in its
discretion may elect, the balance of all amounts collected and in
Mortgagee’s possession shall be paid to Mortgagor, and no
other party shall have any right of claim thereto.
4.7 Damages; Insurance and Condemnation
Proceeds.
(a) (i) All awards of
damages and all other compensation payable directly or indirectly
by reason of a condemnation or proposed condemnation (or transfer
in lieu thereof) for public or private use affecting the Subject
Property; (ii) all other claims and awards for damages to or
decrease in value of the Subject Property; (iii) all proceeds of
any insurance policies payable by reason of loss sustained to the
Subject Property; and (iv) all interest which may accrue on any of
the foregoing, are all absolutely and irrevocably assigned to and
shall be paid to Mortgagee. At the absolute discretion of
Mortgagee, whether or not its security is or may be impaired, but
subject to applicable law if any, and without regard to any
requirement contained in any other Section hereof, Mortgagee may
apply all or any of the proceeds it receives to its expenses in
settling, prosecuting or defending any such claim and apply the
balance to the Secured Obligations in any order, and release all or
any part of the proceeds to Mortgagor upon any conditions Mortgagee
may impose. Mortgagee may commence, appear in, defend or prosecute
any assigned claim or action, and may adjust, compromise, settle
and collect all claims and awards assigned to Mortgagee; provided
however, that in no event shall Mortgagee be responsible for any
failure to collect any claim or award, regardless of the cause of
the failure.
(b) At its sole
option, Mortgagee may permit insurance or condemnation proceeds
held by Mortgagee to be used for repair or restoration but may
impose any conditions on such use as Mortgagee deems
necessary.
4.8 Maintenance and Preservation
of Subject Property. Subject to the provisions of any Secured
Obligation, Mortgagor covenants:
(a) to keep the
Subject Property in good condition and repair;
(b) except with
Mortgagee’s prior written consent, not to remove or demolish
the Subject Property, nor alter, restore or add to the Subject
Property, nor initiate or acquiesce in any change in any zoning or
other land classification which affect