Exhibit 10.9
Documentary Stamp Taxes:
$
Intangible Taxes:
$
Recording:
$
Total:
$
This instrument was prepared
by:
Darryl H. Levy,
Esq.
Greer, Herz & Adams,
L.L.P.
2525 South Shore Blvd., Suite 203
League City, Texas 77573
After Recording, Return
to:
Lesa L. Rosinski
Greer, Herz & Adams,
L.L.P.
2525 South Shore Blvd., Suite 203
League City, Texas 77573
MORTGAGE, ASSIGNMENT OF RENTS,
SECURITY AGREEMENT
FINANCING STATEMENT AND
FIXTURE FILING
This Mortgage, Assignment of Rents,
Security Agreement, Financing Statement and Fixture Filing
(hereinafter termed “Mortgage”) is entered into between
TNP SRT OSCEOLA VILLAGE, LLC, a Delaware limited liability company
(hereinafter termed “Mortgagor”) whose mailing address
is 1900 Main Street, Suite 700, Irvine, California 92614, and
AMERICAN NATIONAL INSURANCE COMPANY, a Texas insurance company,
whose mailing address is Attn: Mortgage and Real Estate Investment
Department, One Moody Plaza, Galveston, Texas 77550 (hereinafter
termed “Mortgagee”).
I.
DEFINITIONS
1.1 The term
“Indebtedness” shall mean and include:
(1) Any and all sums becoming due
and payable pursuant to the Note, as hereinafter
defined;
(2) Any and all other sums becoming
due and payable by Mortgagor to Mortgagee including, but not
limited to, (a) such sums as may hereafter be borrowed by
Mortgagor from Mortgagee (it being contemplated that such future
indebtedness may be incurred), including, but not limited to
advancements or expenditures made by Mortgagee pursuant to the
terms and conditions of this Mortgage or any other document
evidencing, securing or otherwise relating to the Note and
(b) the Twenty-Five Per Cent Profit Participation Payment, as
defined below; and
(3) Any and all obligations,
covenants, agreements and duties of any kind or character of
Mortgagor now or hereafter existing, known or unknown, arising out
of or in connection with the Note, this Mortgage, or any other
document evidencing, securing or relating to the Note.
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(4) All renewals, extensions,
modifications, increases, consolidations and rearrangements of any
or all of the obligations, covenants, agreements and duties of
Mortgagor defined herein under the term Indebtedness, whether or
not Mortgagor executes any renewal, extension, modification,
increase, consolidation or rearrangement.
1.2 The term
“Collateral” shall mean and include (a) all of the
goods, articles of personal property, accounts, general
intangibles, instruments, documents, furniture, furnishings,
equipment and/or fixtures of every kind and nature whatever
(including, without limitation, the items described in subsection
(b) - (f) below) now or hereafter owned by Mortgagor, in or
hereafter placed in, or used or which may become used, in
connection with or in the operation of the Mortgaged Premises,
together with all additions thereto, replacements thereof,
substitutions therefor and all proceeds thereof; (b) all
rents, rentals, payments, compensations, revenues, profits,
incomes, leases, licenses, concession agreements, insurance
policies, plans and specifications, contract rights, accounts,
escrowed funds, and general intangibles in any way relating to the
Mortgaged Property or used or useful in the use, enjoyment,
ownership or operation of the Mortgaged Property; (c) all
names, trade names, signs, marks, and trademarks under which the
Mortgaged Property, or any part thereof, is known or operated and
all of Mortgagor’s rights to carry on the business of
Mortgagor under all such name or names and any variant or variance
thereof; (d) all deposits, awards, damages, payments, escrowed
monies, insurance proceeds, condemnation awards, impact fee
credits, or other compensation, and interests, fees, charges or
payments accruing on or received from or to be received on any of
the foregoing in any way relating to the Mortgaged Property, or the
ownership, enjoyment or operation of the Mortgaged Property
(including, without limitation, the right to claim, collect,
receive and receipt refunds and reimbursements from property taxing
authorities, utilities and insurers) together with all proceeds of
the foregoing described in this Section 1.2; (e) any and
all cash, securities, un-certificated securities, investment
property, securities accounts, financial assets, deposit accounts,
securities entitlements and other personal property now or
hereafter in or coming into or being credited to, or represented by
any of the foregoing including, without limitation, any and all
interest, dividends, rights, options, powers, splits and income
thereon;; and (f) all products, proceeds, substitutions, and
replacements of any of the above described collateral.
1.3 The term “Mortgaged
Premises” shall mean and include (a) the real property
situated in the County of Osceola, State of Florida, described in
Exhibit “A” which is attached hereto and
incorporated herein for all purposes; together with all buildings
and improvements of every kind and description now or hereafter
erected or placed thereon and all materials now or hereafter placed
thereon intended for construction, reconstruction, alteration and
repairs of such buildings and improvements, all of which materials
shall be deemed to be included as a part of said real property
immediately upon the delivery thereof to said real property;
(b) all fixtures now or hereafter owned by Mortgagor and
attached to, contained in or used in connection with said real
property, and all renewals and replacements thereof, including but
not limited to (i) all equipment, apparatus, machinery,
motors, elevators, fittings and radiators, (ii) all plumbing,
heating, lighting, ventilating, refrigerating, incinerating,
air-conditioning and sprinkler equipment; (iii) all awnings,
storm windows and doors, mantels, cabinets, rugs, carpeting,
linoleum, stoves, shades, draperies, blinds and water heaters;
(iv) such other goods and chattels
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and personal property as are usually furnished
by landlords in letting an unfurnished building, or which shall be
attached to said buildings and improvements by nails, screws,
bolts, pipe connections, masonry or in any other manner; and
(v) all built-in equipment as may be shown by plans and
specifications.
1.4 The term “Mortgaged
Property” shall mean the Mortgaged Premises and
Collateral.
1.5 The term “Note”
shall mean, individually and collectively, the following promissory
notes that are of even date herewith, made by Mortgagor and payable
to the order of Mortgagee,: (i) that certain Promissory Note
in the original principal amount of $15,583,00.00 and all notes
given in renewal, extension, modification, increase, consolidation
or rearrangement of said promissory notes or any portion thereof
(“Note 1”); and (ii) that certain Promissory Note
in the original principal amount of $3,417,000 and all notes given
in renewal, extension, modification, increase, consolidation or
rearrangement of said promissory notes or any portion thereof
(“Note 2”).
1.6 The term “Key Tenant
Lease” means, individually and collectively, the Publix
Lease, defined below, and the HH Gregg Lease, defined
below.
1.7 The term “Master
Lease” refers to that certain Master Lease dated on or about
the date hereof concerning by and between Mortgagor as landlord and
TNP SRT Osceola Village Master Lessee, LLC, a Delaware limited
liability company, as tenant, concerning a portion of the Mortgaged
Property as more particularly described therein, and all renewals,
extensions and modifications of said Master Lease or any portion
thereof.
1.8 The term “Master Lease
Guaranty” shall mean, individually and collectively, refers
to (i) that certain Guaranty executed by TNP Strategic Retail
Trust, Inc., a Maryland corporation, on or about the date hereof in
favor of Mortgagor concerning the Master Lease and all renewals,
extensions and modifications of all or any portion thereof; and
(ii) that certain Guaranty executed by Thompson National
Properties, LLC, a Delaware limited liability company, on or about
the date hereof in favor of Mortgagor concerning the Master Lease
and all renewals, extensions and modifications of all or any
portion thereof.
II. GRANT OF
MORTGAGE
In consideration of Ten Dollars
($10.00) cash in hand paid, of Mortgagee’s advancing or
extending to Mortgagor the funds or credit constituting a part of
the Indebtedness, and the mutual covenants contained herein, the
receipt and sufficiency of which are hereby acknowledged, Mortgagor
hereby grants and delivers unto Mortgagee a good first mortgage
lien upon the above-described Mortgaged Property, for the purpose
of securing the Indebtedness, and the full and complete performance
of each and every obligation, covenant, duty and agreement of
Mortgagor contained herein or in the Note or any other document
executed by Mortgagor pertaining to the Note or as security
therefor; TO HAVE AND TO HOLD such mortgage lien, together with the
rights, privileges and appurtenances thereto belonging unto the
Mortgagee and its substitutes, successors and assigns forever, and
Mortgagor is hereby bound to warrant and forever defend the
Mortgaged Property unto the Mortgagee, his substitutes or
successors and their assigns, against the claims of all persons
claiming any interest in the Mortgaged Property or any part thereof
save and except only these items identified on Exhibit
“B” attached hereto and incorporated herein for all
purposes (the “Permitted Exceptions”).
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III. ADDITIONAL SECURITY
As further security for the
Indebtedness and the full and complete performance of each and
every obligation, covenant, agreement and duty of Mortgagor
contained herein or contained in any other document executed by
Mortgagor pertaining to the Note or the security
therefor:
A. Security Interest .
Mortgagor hereby grants and conveys to Mortgagee a security
interest in and lien on all of the Collateral. This Mortgage shall
serve as a Security Agreement created pursuant to the Florida
Uniform Commercial Code, and Mortgagee shall have and may exercise
all rights, remedies and powers of a secured party under the
Florida Uniform Commercial Code. Mortgagor hereby represents,
warrants and covenants that (1) Mortgagor is the owner and
holder of the Collateral free and clear of any adverse claim,
security interest or encumbrance, except those created herein;
(2) it will defend the Collateral, and the priority of the
security interest created herein as a valid first security interest
against all claims and demands of any person at any time claiming
the same or any interest therein; (3) there are no financing
statements executed by the Mortgagor, as Debtor, now on file in any
public office except those financing statements which are being
released contemporaneously with the delivery of this transaction or
which have been authorized by Mortgagee; (4) Mortgagor
authorizes Mortgagee to file or record such other and further
agreements, financing statements and assignments in such offices
and at such times as it is deemed by Mortgagee to be necessary or
desirable; and (5) it will execute and deliver to Mortgagee
such other and further agreements, financing statements and
assignments as Mortgagee may request.
This Mortgage is intended to
constitute a fixture filing in accordance with the applicable
provisions of the Florida Uniform Commercial Code. The debtor is
the Mortgagor and the secured party is the Mortgagee and their
addresses are those set forth at the beginning of this Mortgage.
Certain of the Mortgaged Property is or will become
“fixtures” (as that term is defined in the Florida
Uniform Commercial Code), and this Mortgage, upon being filed for
record in the real estate records of the county wherein the
Mortgaged Premises are situated, shall operate also as a financing
statement filed as a fixture filing in accordance with the
applicable provisions of the Florida Uniform Commercial Code upon
such Mortgaged Property that is or may become fixtures.
Mortgagor covenants and agrees that
Mortgagor will furnish Mortgagee with notice of any change in name,
identity, organizational structure, mailing address, residence,
state of formation or organization, principal place of business or
location (as that term is defined in the Code) 30 days prior to the
effective date of any such change. Mortgagor hereby authorizes the
filing of any financing statements or other instruments deemed
necessary by Mortgagee to prevent any filed financing statement
from becoming misleading or losing its perfected status or to
reinstate any lapsed financing statement.
Mortgagor agrees that the filing of
a financing statement in the records normally having to do with
personal property shall never be construed as in any way derogating
from or impairing
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the express declaration and intention of the
parties hereto, hereinabove stated, that everything used in
connection with the production of income from the Mortgaged
Property and/or adapted for use therein and/or which is described
or reflected in this Mortgage is, and at all times and for all
purposes and in all proceedings, legal or equitable, shall be
regarded as real property irrespective of whether (i) any such
item is physically attached to the real property or improvements
thereon; (ii) serial numbers are used for the better
identification of certain equipment items capable of being thus
identified in a recital contained herein or in any list filed with
Mortgagee; or (iii) any such item is referred to or reflected
in any such financing statement so filed at any time. Similarly,
the mention in any such financing statement of (x) rights in
or to the proceeds of any fire and/or hazard insurance policy;
(y) any award in eminent domain proceedings for a taking or
for loss of value; or (z) Mortgagor’s interest as lessor
in any present or future leases or subleases or rights to rents
growing out of the use and/or occupancy of the Mortgaged Property,
whether pursuant to lease or otherwise, shall never be construed as
in any way altering any of the rights of Mortgagee as determined by
this instrument or impugning the priority of this Mortgage or any
of the other documents entered into in connection with the loan
evidenced by the Note, but such mention in the financing statement
is declared to be for the protection of Mortgagee in the event any
court or judge shall at any time hold with respect to (x), (y), or
(z) that notice of Mortgagee’s priority of interest to
be effective against a particular class of persons, including, but
not limited to, the federal government and any subdivision or
entity of the federal government, must be filed in the Code records
or otherwise perfected in the manner required by the
Code.
B. Assignment of Condemnation
Awards . To the extent of the full amount of the Indebtedness
secured hereby and of the cost and expenses (including reasonable
attorneys’ fees) incurred by Mortgagee in the collection of
any award or payment, Mortgagor hereby assigns to Mortgagee any and
all awards or payments, including all interest thereon, together
with the right to receive the same, which may be made with respect
to the Mortgaged Property as a result of (a) the exercise of
the right of eminent domain, (b) the alteration of the grade
or of any street, or (c) any other injury to or decreased
value in the Mortgaged Property, as well as the right, but not the
obligation, to, at Mortgagor’s expense, participate in and
make decisions concerning the progress of any proceeding involving
any such award or payment. Mortgagor shall give Mortgagee written
notice of any such action or proceeding immediately upon
Mortgagor’s becoming aware of same. All such damages,
condemnation proceeds and consideration shall be paid directly and
solely to Mortgagee whether or not an Event of Default has at such
time occurred, and after first applying said sums to the payment of
all costs and expenses (including reasonable attorneys’ fees)
incurred by Mortgagee in obtaining such sums, Mortgagee may, at its
option, apply the balance on the Indebtedness, in any order and
whether or not then due, without prepayment or penalty, or to the
restoration of the Mortgaged Property, or release the balance to
Mortgagor. Said application or release shall not cure or waive any
default. Notwithstanding the foregoing, if the Publix Lease and/or
the HH Gregg Lease remain in full force and effect and such
applicable lease is not terminated due to any such condemnation or
taking then Mortgagee shall permit the condemnation proceeds to be
made available for the repair and replacement of the Mortgaged
Property if and to the extent that by any such non- terminated
lease requires that such proceeds be made available for said
purpose.
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IV. ABSOLUTE ASSIGNMENT OF
RENTS
In further consideration for the
indebtedness evidenced by the Note, Mortgagor hereby absolutely and
unconditionally assigns to Mortgagee all rents, revenues, profits
and incomes from the Mortgaged Property or any portion thereof.
Provided, however, so long as no Event of Default has occurred,
Mortgagor is hereby granted a license to collect and retain the
currently accruing rents, income and profits from the Mortgaged
Property, but in no event may Mortgagor collect same for more than
one (1) month in advance of the date upon such rents become
due. If an Event of Default shall occur, however, thereupon, and at
any time thereafter such default is continuing, Mortgagee may
terminate such license and may, without any liability to Mortgagor,
take possession and control of the Mortgaged Property and/or
receive and collect all rents, revenues, profits and income,
accrued or accruing thereafter so long as any of the Indebtedness
remains unpaid, applying so much thereof as may be collected first
to the expenses incident to taking possession and/or the collection
thereof, and second to the payment of the Indebtedness other than
the Note and then to the amount of the Note then remaining unpaid,
at Mortgagee’s discretion, either principal or interest, in
any order, and whether then matured or not, paying the balance, if
any, to the Mortgagor. It is intended by Mortgagor and Mortgagee
that this assignment of rents constitutes an absolute assignment
and not an assignment for additional security only and that
Mortgagee shall be entitled to exercise its rights hereunder
whether or not Mortgagee is in possession of the Mortgaged Premises
at such time. Mortgagor agrees to fulfill or perform each and every
covenant of any and all leases and guaranties of leases of the
Mortgaged Property so as to keep them at all times in full force
and effect. Mortgagor agrees not to enter into any new lease, and
not to make any modification, consent to any modification of, or
cancel, terminate or consent to the surrender of any lease or any
guaranty of such lease after such lease or guaranty has been
executed by Mortgagor and the lessee or guarantor, as applicable,
without the prior written consent of Mortgagee, not to be
unreasonably withheld, conditioned or delayed for any leases or
guaranties other than with respect to a Key Tenant Lease or any
guaranty thereof for which any consent shall be in
Mortgagee’s sole and absolute discretion); the failure to
fulfill or perform any such covenant or the making of or consent to
any such modification or cancellation, termination or surrender
shall be an Event of Default; provided, however, that:
(A) until such time as there exists
an uncured Event of Default, Mortgagor may in good faith in the
ordinary course of business with tenants unaffiliated with the
Mortgagor (i) enter into new leases for premises of 2,000
square feet or less for a term, including any extension options, of
not more than five (5) years at prevailing market rates and
(ii) exercise the landlord’s remedies for default in
good faith in the ordinary course of business for any lease of
2.000 square feet or less including the exercise of any termination
of such a lease for a tenant’s default. For purposes of
calculating such square footage as provided in this Article IV, all
leases with the same tenant or with affiliates of such tenant shall
be aggregated; and
(B) enter into a lease modification
for leases with premises of 2,000 square feet or less (aggregated
as provided in subsection (B) above) may in good faith in the
ordinary course of business with tenants unaffiliated with the
Mortgagor if such modification (i) does not reduce any rent
below prevailing market rates provided that with respect to any
lease that is in existence on the date hereof, the Mortgagor may
not reduce the rent during the term of such leases
without
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Mortgagee’s written consent,
(ii) does not involve any reduction in term, (iii) does
not extend the term including any extension options, for more than
five (5) years beyond the existing term, and (c) does not
otherwise materially modify the lease.
Nothing contained in this Mortgage
or in any other document securing, evidencing or relating to the
Indebtedness shall preclude Mortgagee from taking any action to
cure or remedy any default of the Landlord under any lease of all
or any portion of the Mortgaged Property or any guaranty of lease,
or any act, omission or occurrence which but for the passage of
time, the giving of notice, or both, would be a default under any
such lease or guaranty of lease or take any other action in
connection therewith and any amounts expended by Mortgagee in
connection with such cure or remediation including, without
limitation, reasonable attorneys fees and expenses, shall be an
advance under and secured by this Mortgage and shall be included in
the Indebtedness and shall be paid by Mortgagor to Mortgagee on
demand. The preceding sentence shall not be construed to obligate
Mortgagee to cure any such actual or potential lease defaults or
any guaranty of lease defaults.
V. MORTGAGOR’S
REPRESENTATIONS AND WARRANTIES
In order to induce Mortgagee to lend
the funds evidenced by the Note, Mortgagor represents and warrants
that:
A. Accurate Loan
Information . All information and financial statements
furnished or to be furnished to Mortgagee by or on behalf of
Mortgagor in connection with the Indebtedness secured by this
Mortgage is or at the time of delivery will be complete and
accurate in all material respects.
B. Valid Title .
Mortgagor is the lawful owner of the Mortgaged Property and has
good right and lawful authority to mortgage and pledge the
same.
C. Freedom from
Encumbrances . The Mortgaged Property is free from any and all
liens and encumbrances save and except only the Permitted
Exceptions, and Mortgagor does warrant and will defend title to the
Mortgaged Property against all claims or demand by third parties
whatsoever save and except only the Permitted
Exceptions.
D. Maintenance of Lien
Priority. Mortgagor shall take all steps necessary to preserve
and protect the validity and priority of the first mortgage lien on
the Mortgaged Property created hereby. Mortgagor shall execute,
acknowledge and deliver such additional documents as Mortgagee may
deem necessary in order to preserve, protect, continue, extend or
maintain the liens and security interests created hereby as first
liens on the Mortgaged Property. All costs and expenses incurred in
connection with the protection, preservation, continuation,
extension or maintaining of the security interest and the liens
herein created as valid first and subsisting liens shall be paid by
Mortgagor.
E. Value of the Mortgaged
Property . Mortgagor acknowledges that the value of the
Mortgaged Property, as established by an appraisal submitted to
Mortgagor, is substantially in excess of the Indebtedness secured
hereby. Mortgagor acknowledges but for the Mortgaged
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Property having a value in excess of the amount
of the Indebtedness, Mortgagee would not make the loan evidenced by
the Note and advance the funds hereunder. Mortgagor agrees that
Mortgagee shall at all times have the benefit of the Mortgaged
Property as the security for the Indebtedness even though the value
thereof may now or in the future exceed the amount of the
Indebtedness secured hereby.
F. Representations,
Warranties and Covenants of a Limited Liability Company
. Mortgagor hereby represents, warrants and covenants
that:
(1) Mortgagor is a Delaware limited
liability company created under that certain Certificate of
Formation filed effective as of September 26, 2011 (
“Certificate of Formation”) and there are no amendments
thereto and that certain Operating Agreement dated effective as of
September 1, 2011 (“LLC Agreement”) and there are
no amendments thereto.
(2) The only member of Mortgagor is
TNP Strategic Retail Operating Partnership, L.P., a Delaware
limited partnership (the “Sole Member”).
(3) Any one of Anthony W. Thompson,
Chief Executive Officer, Jack Maurer, President, or James Wolford,
Chief Finance Officer, of TNP Strategic Retail Trust, Inc., a
Maryland corporation, the sole general partner of the Sole Member,
is authorized to execute and deliver the Note, this Mortgage, and
all other documents which, pursuant to the terms of the Loan
Documents, Mortgagee may now or from time to time hereafter require
to be executed on behalf of Mortgagor, in connection with the Note,
this Mortgage and the other Loan Documents, including but not
limited to renewals, extensions, modifications, increases,
consolidations and rearrangements of the Note and Mortgage, and no
signature or any other action of any person or entity other than
anyone of Anthony W. Thompson, Chief Executive Officer, Jack
Maurer, President, or James Wolfhound, Chief Finance Officer, of
TNP Strategic Retail Trust, Inc., a Maryland corporation, the sole
general partner of the Sole Member shall be required to bind
Mortgagor.
(4) Except for Permitted Transfers
(hereinafter defined), Mortgagor will not permit any membership
interest in Mortgagor to be sold, transferred, conveyed, encumbered
or diluted or make any modification of the Certificate of Formation
or LLC Agreement which shall have a material adverse effect on the
rights of Mortgagee.
(5) Mortgagor and Sole Member are
each, and shall each continue to be, (a) duly organized and
existing under the laws of the State of Delaware and Maryland,
respectively, or such other states under the laws of which
Mortgagor or Sole Member may hereafter be organized, provided that
neither Mortgagor nor Sole Member shall be permitted to change its
structure to the extent any such change shall have a material
adverse effect on the rights of Mortgagee and (b) duly
qualified to transact business in each State where the conduct of
the respective business of each requires it to be
qualified.
G. Construction and Materials
. Mortgagor hereby warrants, represents and covenants that all
persons and entities who have provided labor or materials to or for
the benefit of the Mortgaged Property by, through or under
Mortgagor or otherwise at Mortgagor’s direction or request at
any time prior to the date of this Mortgage have been paid in
full.
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H. Hazardous Waste .
Mortgagor hereby represents and warrants that to its actual
knowledge Mortgagor is not aware of any facts or circumstances
which may give rise to any litigation, proceedings, investigations,
citations or notices of violations resulting from the use,
presence, generation, manufacture, storage, discovery or
disposition of, on, under or about the Mortgaged Property or the
transport to or from the Mortgaged Property of any Hazardous
Materials, defined below. Mortgagor hereby represents and warrants
that the Mortgaged Property is not in violation of and Mortgagor
covenants and agrees not to use or knowingly permit the use of the
Mortgaged Property for any purpose which would be in violation of,
any federal, state or local health or environmental statute,
regulation, ordinance or publication which is presently in effect
or that may be promulgated in the future, as such statutes,
regulations, ordinances and publications may be amended from time
to time relating to Hazardous Materials, including, without
limitation, with respect to industrial hygiene or to health or
environmental conditions on, under, or about the Mortgaged Property
(including, but not limited to, soil and ground water conditions)
or with respect to the owner’s or occupant’s thereof.
The foregoing representations and warranties shall survive
foreclosure under this Mortgage and shall constitute continuing
representations and warranties to Mortgagee, its successors and
assigns, as to conditions existing prior to foreclosure or in deed
in lieu of foreclosure only. The term “Hazardous
Materials”, as used in this Mortgage, shall include but not
be limited to:
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(i)
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petroleum,
petroleum based products and oil;
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(ii)
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asbestos of any
form which is or could become friable, urea formaldehyde foam
insulation, transformers or other equipment which contain
dielectric fluid containing levels of polychlorinated biphenyls
(sometimes known as a “pcb”);
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(iii)
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tanks, whether
empty, filled or partially filled with any substance, material,
chemical or other waste;
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(iv)
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any substance,
material, chemical or other waste including, without limitation any
explosive, flammable substances, explosives or radioactive
materials, hazardous or toxic waste, hazardous or toxic materials,
hazardous, toxic or radioactive substances, contaminants or
pollutants and any of the preceding which are defined as or
included in the definition of “Hazardous Substance”,
“Hazardous Waste”, “Hazardous Material” or
“Toxic Substance” or other similar or related terms
under any applicable local, state or federal statute, regulation,
ordinance or publication (individually and collectively the
“Environmental Laws”), including but not limited to
including but not limited to:
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(1)
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Resource
Conservation and Recovery Act of 1976 (commonly referred to as the
Solid Waste Disposal Act), 42 U.S.C. 6901 et seq
.
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(2)
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Comprehensive
Environmental Response, Compensation, and Liability Act of 1980, 42
U.S.C. 9601 et seq .
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(3)
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Clean Air Act,
42 U.S.C. Sections 7401 et seq .
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(4)
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The Water
Pollution and Prevention and Control Act (commonly referred to as
the Clean Water Act) 33 U.S.C. Sections 1251- et seq
.
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(5)
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Hazardous
Materials Transportation Act, 49 U.S.C. Sections 1801 et
seq .
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(6)
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Federal
Insecticide, Fungicide and Rodenticide Act, 7 U.S.C. 136 et
seq.
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(7)
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Toxic
Substances Control Act, 15 U.S.C. 2601 et
seq.
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(8)
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Safe Drinking
Water Act, 42 U.S.C. 300(f) et seq .
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(9)
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Florida
Resource Recovery and Management Act, Florida Water Quality
Assurance Act of 1983, Florida Resource Conversation and Recovery
Act, Florida Air and Water Pollution Control Act, Florida Safe
Drinking Water Act, and Florida Pollution Spill Prevention and
Control Act,
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as such statutes, regulations,
ordinances and publications may be amended from time to
time;
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(v)
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any other
material, substance, chemical or other waste, exposure to which is
prohibited, limited or regulated from time to time by any federal,
state or local statute, regulation, ordinance or publication or may
pose a hazard to the health and/or safety of the occupants of the
Mortgaged Property or any other adjacent property.
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NOTWITHSTANDING ANY NON-RECOURSE
LANGUAGE OF THE NOTE OR THIS MORTGAGE, Mortgagor hereby agrees to
INDEMNIFY AND HOLD HARMLESS Mortgagee, its directors, officers,
employees, attorneys, contractors and agents, and any successors
and assigns, their directors, officers, employees, and agents
(individually and collectively the “Indemnitees”), from
and against any and all loss, damage, expense or liability
(including reasonable attorneys fees and investigatory expenses)
incurred arising out of the use, occurrence, generation, storage,
transportation or disposal of Hazardous Materials on or about the
Mortgaged Property by Mortgagor, its present tenants or any future
tenants, any prior owner, operator or tenant of the Mortgaged
Property, or any third party, including, without limitation,
(i) all foreseeable and all unforeseeable consequential
damages, directly or indirectly arising out of the use, occurrence,
generation, storage, transportation or disposal of Hazardous
Materials by Mortgagor, past, present or future tenants, owners or
operators of the Mortgaged Property, or any third party, and
(ii) the cost of any required or necessary repair, cleanup or
detoxification, claimed, threatened or asserted against any such
Indemnitee; SUCH INDEMNITY AND HOLD HARMLESS SPECIFICALLY INCLUDES
ANY LOSS, DAMAGE, EXPENSE OR LIABILITY CAUSED BY OR ATTRIBUTABLE TO
THE ORDINARY OR SIMPLE NEGLIGENCE, AS OPPOSED TO THE GROSS
NEGLIGENCE, OF AN INDEMNITEE AND FOR ANY ACTION OR OCCURRENCE FOR
WHICH THE INDEMNITEE MAY INCUR
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STRICT LIABILITY, but such indemnity and hold
harmless shall not apply with respect to any Hazardous Substances
which first occurred on the Mortgaged Property after any
foreclosure of this Mortgage or conveyance in lieu thereof, after
the sale of the Mortgaged Property pursuant to a transaction
undertaken with Noteholder’s consent as provided in this
Mortgage, or to the extent that such loss, damage, expense or
liability is caused by or attributable to such Indemnitee’s
gross negligence or willful misconduct. Mortgagor’s
obligations pursuant to the foregoing indemnity and hold harmless
shall survive any termination of the estate created by this
Mortgage whether as a result of the exercise by Mortgagee of any
default remedies available to it at law or in equity or otherwise.
Mortgagor acknowledges and agrees that as a condition precedent to
making the loan to Mortgagor evidenced by the Note secured by this
Mortgage, Mortgagee has required that Mortgagor provide to the
Indemnitees the indemnity set forth herein and that Mortgagee would
not consummate the loan without this indemnity and hold harmless
and that the indemnity and harmless contained herein is a material
inducement for Mortgagee’s agreement to make the loan.
Further, Mortgagor agrees that the foregoing indemnification is
separate, independent of and in addition to its undertakings as
Mortgagor under the Note, as Mortgagor under this Mortgage, as
Assignor under the Absolute Assignment of Leases and Rents and any
and all other documents, agreements and undertakings executed by
Mortgagor in favor of Mortgagee pursuant to the Note. Mortgagor
agrees that a separate action may be brought to enforce the
provisions of this indemnification and hold harmless, which shall
in no way be deemed to be an action on the Note or under this
Mortgage, whether or not Mortgagee would be entitled to a
deficiency judgment following a foreclosure sale of the Mortgaged
Property.
Except as otherwise disclosed to
Mortgagee in writing, to Mortgagor’s actual knowledge, the
present uses and occupancies of the Mortgaged Property do not
violate or conflict with any applicable law, statute, ordinance,
rule, regulation or order of any kind, including, without
limitation, Environmental Laws, zoning, building, land use, noise
abatement, occupational health and safety or other laws, any
building permit or any condition, grant, easement, covenant,
condition or restriction, whether recorded or not and if a
third-party is required under any covenants, conditions and
restrictions of record or any other agreement to consent to the use
and/or operation of the Mortgaged Property, Mortgagor has obtained
such approval from such party;
To Mortgagor’s actual
knowledge, the Mortgaged Property has never been used, nor has
Mortgagor used the Mortgaged Property, for any activities which,
directly or indirectly, involve the use, generation, treatment,
storage, transportation or disposal of any Hazardous Materials.
Except as disclosed in any environmental reports for the Mortgaged
Premises (collectively, the “ Environmental Reports
”) provided to Mortgagee prior to the date hereof, no
Hazardous Materials, to Mortgagor’s actual knowledge, exist
on or under the Mortgaged Property or in any surface water(s) or
groundwater(s) on or under the Mortgaged Property. Except as may be
disclosed in the Environmental Reports, to Mortgagor’s actual
knowledge, the Mortgaged Property and its prior uses have at all
times complied with all Environmental Laws, and Mortgagor has not
violated, and will not violate, any Environmental Laws;
There are no facilities on the
Mortgaged Property which are subject to reporting under any State
laws or Section 312 of the Federal Emergency Planning and
Community Right-to-Know Act of 1986 (42 U.S.C. sec. 11022), and
federal regulations promulgated thereunder. The Mortgaged Property
does not contain any underground storage tanks.
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VI. ADDITIONAL COVENANTS OF
MORTGAGOR
As long as any of the Indebtedness
remains unpaid, Mortgagor covenants and agrees that:
A. Payment of
Indebtedness. Mortgagor will pay the Indebtedness promptly when
due and payable.
B. Payment of Taxes and
Other Assessments. Mortgagor will pay all taxes, assessments
and other governmental, municipal or other public dues, charges,
fines, or impositions imposed or levied upon the Mortgaged Property
or on the interest created by this Mortgage, or any tax or excise
on rents or other tax, however described, assessed or levied by any
state, federal or local taxing authority as a substitute, in whole
or in part, for taxes assessed or imposed on the Mortgaged Property
or on the interest created by this Mortgage, and at least ten
(10) days before said taxes, assessments and other
governmental charges are due will exhibit receipts therefor to
Mortgagee. If any tax or assessment is levied, assessed or imposed
on Mortgagee as a legal holder of the Note or any interest in the
documents securing, evidencing or relating to the Note by any
governmental authority, then unless all such taxes are paid by
Mortgagor as they become due and payable and in the opinion of
Mortgagee based on consultation with its counsel, such payment by
Mortgagor is lawful and does not place Mortgagee in violation of
any law, Mortgagee may, at its option, declare the Indebtedness
immediately due and payable, but in this event no prepayment
premium shall be due or payable. Notwithstanding the foregoing,
Mortgagor shall have the right to challenge any such levy,
assessment or imposition; provided, however, that (1) such a
challenge shall be lawful; (2) such a challenge shall not
place Mortgagee in violation of any law; (3) Mortgagor shall
indemnify and hold Mortgagee harmless from any and all loss,
liability, cost or expense that may arise due to Mortgagor’s
challenge; and (iv) such contested item and all costs and
penalties, if any, shall have been paid at least thirty
(30) days before the date on which the Mortgaged Property, or
any portion thereof, may be sold in order to satisfy any such
contested items. Upon a final determination as to Mortgagor’s
challenge, Mortgagor shall immediately pay any and all such taxes,
assessments or other governmental charges deemed to be due and
payable. If Mortgagor fails to timely pay or cause such amounts to
be paid prior to delinquency, Mortgagee may, at its option declare
the Indebtedness immediately due and payable.
C. Insurance .
Mortgagor shall keep the Mortgaged Property insured against loss or
damage by fire, windstorm, extended coverage perils, flood (in the
event any of the Mortgaged Premises is within a 100-year flood
plain and flood insurance is available pursuant to the United
States Flood Disaster Protection Act of 1973 or any similar or
successor statute or successor governmental authority), vandalism,
malicious mischief and such other hazards, casualties or other
contingencies and in such amounts (but in no event less than the
greater of the amount of the Indebtedness from time to time secured
hereby or the full replacement value thereof) as from time to time
may be required by Mortgagee, and maintain rents or rental value
insurance coverage, in an amount at least adequate to cover twelve
(12) months’ principal and interest
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installments on the Note and together with
twelve (12) months’ property taxes and insurance
premiums, with respect to the Mortgaged Property covering the risk
of loss due to the occurrence of any of the foregoing hazards, in
each case and in such amounts, in such manner and in such companies
as the Mortgagee may approve, and all such policies shall contain a
waiver of subrogation and provide that any losses payable
thereunder shall (pursuant to standard mortgagee clauses without
contribution, including one providing that such insurance as to the
interest of Mortgagee shall not be invalidated by any act or
omission or neglect of Mortgagor, to be attached to each policy) be
payable to Mortgagee. Mortgagor shall cause duplicate originals of
any and all such insurance policies to be deposited with Mortgagee.
Mortgagor will also carry public liability insurance, in such form,
amounts and with such companies as Mortgagee may from time to time
reasonably require, with Mortgagee included thereon as a named
insured. Any or all of such policies may be provided under a
blanket policy or policies provided such blanket policies allocate
the amount of insurance required hereunder to the Mortgaged
Property. Mortgagor shall cause duplicate originals of any and all
such insurance policies to be deposited with Mortgagee, or
certificates of the insurers under such policies evidencing same.
At least ten (10) days prior to the date the premiums on each
such policy or policies shall become due and payable, Mortgagor
shall furnish to Mortgagee evidence of the payment of such
premiums. Each of such policies shall contain an agreement by the
insurer that the same shall not be canceled or modified without at
least ten (10) days’ prior written notice to Mortgagee.
In the event of loss under any such policy, Mortgagor shall give
immediate written notice to the insurance carrier and to Mortgagee.
With respect to all insurance policies except public liability
insurance, Mortgagee is hereby authorized, but not required, on
behalf of and at the expense of Mortgagor, whether or not an Event
of Default has then occurred, to make proof of loss, to collect
for, adjust or compromise any losses under any insurance policy on
the Mortgaged Property, to appear in and prosecute any action
arising from any of such insurance policies, and to apply, at
Mortgagee’s option, the loss proceeds (less expenses of
collection) on the Indebtedness, in any order and whether due or
not, or to the restoration of the Mortgaged Property, or to be
released to Mortgagor, but any such application or release shall
not cure or waive any default. In case of a sale pursuant to the
foreclosure provision hereunder, or any conveyance of all or any
part of the Mortgaged Property in extinguishment of the
Indebtedness, complete title to all insurance policies on or
related to the Mortgaged Property, and the unearned premiums of
same shall pass to and vest in the purchaser or grantee of the
Mortgaged Property.
D. Escrow for Taxes and
Insurance . Mortgagor shall pay, in addition to the
installments payable under the Note, on the same day as such
installments are due and payable, a sum equal to 1/12th of the
estimated annual taxes, hazard and rental insurance premiums, and
special assessments, if any, next due on the Mortgaged Property. If
the amount so paid is not sufficient to pay such taxes, insurance
premiums and assessments when due, then Mortgagor will immediately
deposit with Mortgagee amounts sufficient to pay the same. Funds
deposited by Mortgagor pursuant to this provision shall be used to
pay such taxes, insurance premiums and assessments when due,
provided that Mortgagor has furnished Mortgagee with all tax
statements, premium notices and other such notices at least thirty
(30) days prior to the date that any such taxes, premiums and
assessments may be due. If there is a default under the provisions
of the Note or of this Mortgage, Mortgagee may elect, at any time
after default, to apply the funds accumulated under this provision
against the Indebtedness in any manner or order. No interest shall
accrue or be allowed on any payments under the provisions of this
paragraph. Mortgagee
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shall not be required to deposit or hold monies
in an account special or separate from its general funds. Mortgagor
expressly releases Mortgagee from any liability to Mortgagor
arising out of the maintenance by Mortgagee of an escrow as
provided herein or for payment of any sums out of such escrow.
Mortgagor further indemnifies Mortgagee against claims arising out
of payment of taxes or insurance premiums where Mortgagor has
failed to provide Mortgagee with tax statements and premium notices
as required hereby. The maintenance by Mortgagee of an escrow for
taxes and insurance shall not relieve Mortgagor of its obligations
under this Mortgage respecting taxes and insurance on the Mortgaged
Property.
E. Patriot Act .
(1) As of the date of this Mortgage,
Mortgagor is and, during the term of this Mortgage shall remain, in
full compliance with all the applicable laws and regulations of the
United States of America that prohibit, regulate or restrict
financial transactions, including but not limited to, conducting
any activity or failing to conduct any activity, if such action or
inaction constitutes a money laundering crime, including any money
laundering crime prohibited under the Money Laundering Control Act,
18 U.S.C. 1956, 1957, or the Bank Secrecy Act, 31 U.S.C. 5311 et
seq. and any amendments or successors thereto and any
applicable regulations promulgated thereunder.
(2) Mortgagor represents and
warrants that: (i) neither it, nor to its actual knowledge,
any of its Tier Two Owners (as defined below), or any officer,
director or employee, is named as a “Specially Designated
National and Blocked Person” as designated by the United
States Department of the Treasury’s Office of Foreign Assets
Control or as a person, group, entity or nation designated in
Presidential Executive Order 13224 as a person who commits,
threatens to commit, or supports terrorism; (ii) it is not
owned or controlled, directly or indirectly, by the government of
any country that is subject to a United States Embargo;
(iii) it is not acting, directly or indirectly, for or on
behalf of any person, group, entity or nation named by the United
States Treasury Department as a “Specially Designated
National and Blocked Person,” or for or on behalf of any
person, group, entity or nation designated in Presidential
Executive Order 13224 as a person who commits, threatens to commit,
or supports terrorism; and that it is not engaged in this
transaction directly or indirectly on behalf of, or facilitating
this transaction directly or indirectly on behalf of, any such
person, group, entity or nation; iv) no funds will be used to make
any payments due hereunder or pursuant to the Note which were
obtained directly or indirectly from a Specially Designated
National and Blocked Person or otherwise derived from a country
that is subject to a United States Embargo; and (v) no current
or future tenant of any portion of the Mortgaged Property, nor any
officer, director, member, manager, partner or Constituent Owner of
such tenant, is or will become named a Specially Designated
National and Blocked Person; provided that, in the event that a
tenant of any portion of the Mortgaged Property is a
publicly-traded company whose shares are listed on a national stock
exchange, such representation and warranty shall not apply to
shareholders of such tenant.
(3) Mortgagor acknowledges that it
understands and has been advised by legal counsel on the
requirements of the applicable laws referred to above, including
the Money Laundering Control Act, 18 U.S.C. 1956, 1957, the Bank
Secrecy Act, 31 U.S.C. 5311 et seq., the applicable
regulations promulgated thereunder, and the Foreign Assets Control
Regulations, 31 C.F.R. Section 500 et seq .
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(4) Mortgagor shall notify Mortgagee
immediately upon receipt of any information indicating a breach of
this Section VI.E. or if Mortgagor or any officer, director,
member, manager, member, employee or Constituent Owner of Mortgagor
is custodially detained on charges relating to money laundering,
whereupon Mortgagee shall be entitled to take all actions necessary
so that Mortgagee is in compliance with all Anti-Money Laundering
Regulations. Any and all loss, damage, liability, penalty, fine or
expense (including reasonable attorney’s fees and
investigatory expenses) incurred by Mortgagee in connection
therewith, including but not limited to attorney’s fees,
shall be included in the Indebtedness secured hereunder and shall
immediately be due and payable by Mortgagor to
Mortgagee.
F. Waste, Demolition,
Alteration or Replacement . Mortgagor will cause the Mortgaged
Property and every part thereof to be maintained, preserved and
kept in safe and good repair, working order and condition, will not
commit or permit waste thereon, will not remove, demolish or alter
the design or structural character of any building now or hereafter
erected on the Mortgaged Premises, without the prior written
consent of Mortgagee, and will comply with all laws and regulations
of any governmental authority with reference to the Mortgaged
Property and the manner and use of the same, and will from time to
time make all necessary and proper repairs, renewals, additions and
restorations thereto so that the value and efficient use thereof
shall be fully preserved and maintained. Mortgagor agrees not to
remove any of the fixtures or personal property included in the
Mortgaged Property without the prior written consent of Mortgagee
and unless immediately replaced with like property of at least
equal value. Mortgagor shall act as necessary to continue or cause
the continuance of such income producing activity as is presently
conducted upon or contemplated for the Mortgaged
Property.
G. Inventory of Personal
Property . Upon request of Mortgagee, Mortgagor shall deliver
to Mortgagee an inventory describing and showing the make, model,
serial number and location of all fixtures and personal property
owned by Mortgagor and from time to time used in the management,
maintenance and operation of the Mortgaged Property (other than
inventory or property, if any, expressly excluded from the
operation of this Mortgage by separate written agreement) with a
certification by Mortgagor that said inventory is a true and
complete schedule of such fixtures and personal property owned by
Mortgagor and used in the management, maintenance and operation of
the Mortgaged Property and that such items specified in the
inventory constitute all of the fixtures and personal property
required in the management, maintenance and operation of the
Mortgaged Property and that such items are owned by Mortgagor free
and clear of security interests, liens, conditional sales contracts
or title retention arrangements except for those for the benefit of
the Mortgagee. Mortgagor hereby grants to Mortgagee a security
interest in all such items of fixtures and personal property owned
by Mortgagor under the terms and conditions of this
Mortgage.
H. Financial Statement
. Mortgagor will furnish to Mortgagee within one hundred twenty
(120) days after the first day of each and every January (the
“Financial Statement Due Date”) until the Indebtedness
secured hereby has been fully paid, the annual audited financial
statements of Mortgagor covering the operation of the Mortgaged
Property, each such statement prepared in accordance with generally
accepted accounting principles and each such statement prepared and
signed by an independent certified public accountant approved by
and acceptable to Mortgagee.
15
The financial statements shall contain the
Mortgagor’s certification that, during the period of time
covered by the particular statement, to Mortgagor’s
knowledge,(i) no activity has been conducted upon the Mortgaged
Property in violation of any state, federal or local law, ordinance
or regulation pertaining to Hazardous Materials, industrial hygiene
or environmental conditions, and (ii) the Mortgaged Property
complies with all legal requirements regarding access and
facilities for handicapped or disabled persons, including, without
limitation, and to the extent applicable, Part V of the Florida
Building Construction Standards Act entitled “Accessibility
by Handicapped Persons,” Chapter 553, Fla. Stat.; the Federal
Architectural Barriers Act of 1988 (42 U.S.C. § 4151,
et seq. ), The Fair Housing Amendment Act of 1988 (42
U.S.C. § 3601, et seq. ), The Americans
With Disabilities Act of 1990 (42 U.S.C. § 12101
et seq. ), and The Rehabilitation Act of 1973 (29
U.S.C. § 794).
If Mortgagor does not deliver the
financial statements as and when required by this paragraph, there
shall be added to the Indebtedness and Mortgagor agrees to pay upon
demand Two Hundred Dollars ($200.00) for each calendar month or
part thereof following the Financial Statement Due Date until the
required financial statements are delivered to
Mortgagee.
I. Restrictions upon Sale,
Transfer or Mortgaging the Mortgaged Property or the Interest in
Mortgagor . Mortgagor acknowledges that Mortgagee is relying on
the credit worthiness and skill of Mortgagor in advancing sums
secured hereby. Except for a natural person’s transfer by
will or applicable state intestacy laws (collectively, together
with any other matters specifically defined below, “Permitted
Transfers”):(i) if the Mortgagor should sell, trade, convey,
transfer, mortgage, assign, exchange, pledge or encumber
(including, without limiting these provisions or any similar
references in this Mortgage, the granting of a security interest
in) all or any part of the Mortgaged Property, or any interest of
Mortgagor therein, absolutely or as security for a debt or other
obligation, whether done in a direct or indirect method or enter
into any contractual arrangements to do so, or (ii) if a
shareholder, partner, member, trustee or beneficiary of Mortgagor
(sometimes, a “Tier Two Owner”) or if any shareholder,
partner, member, trustee or beneficiary of any Tier Two Owner
(sometimes, a “Tier Three Owner”) (all and any
“Tier Two Owners” and “Tier Three Owners”
are individually and collectively a “Constituent
Owner”) should sell, trade, convey, transfer, mortgage,
assign, exchange, pledge or encumber (including, without limiting
these provisions or any similar references in this Mortgage, the
granti
