Exhibit 10.5
THE
COLLATERAL
SUBJECT TO THIS
MORTGAGE,
SECURITY
AGREEMENT,
AND FINANCING
STATEMENT INCLUDES GOODS THAT ARE OR ARE TO BECOME FIXTURES.
THIS MORTGAGE, SECURITY AGREEMENT, AND FINANCING STATEMENT IS TO BE
FILED IN THE
REAL PROPERTY RECORDS FOR LEXINGTON COUNTY, SOUTH CAROLINA, AND
SHALL SERVE AS A
FIXTURE FILING FINANCING STATEMENT.
STATE OF SOUTH CAROLINA
)
MORTGAGE, SECURITY AGREEMENT
)
AND FINANCING STATEMENT
COUNTY OF LEXINGTON
)
THIS MORTGAGE,
SECURITY AGREEMENT AND FINANCING STATEMENT (the "MORTGAGE")
is made and
entered
into as of
December
9, 2005,
by ENCLAVES OF GRAND OAKS,
LLC., a South Carolina
limited
liability
company,
its successors and assigns
(the
"MORTGAGOR"),
in favor of SOVEREIGN BANK, a federally
chartered
savings
bank, having as an address 1010 Farmington Avenue, West Hartford,
CT 06107, its
successors and assigns (the "MORTGAGEE").
WITNESSETH:
WHEREAS,
the
Mortgagor is indebted to Mortgagee
pursuant to a promissory
note dated of even date
herewith in the face amount of Four Million Six Hundred
Fifteen Thousand and 00/100 Dollars
($4,615,000.00)
(together with any and all
extensions,
renewals, or modifications thereof, the "NOTE"),
evidencing a loan
(the "LOAN") from Mortgagor to Mortgagee in like amount; and
WHEREAS,
the Mortgagor desires to secure its obligations under the Note by
granting the Mortgagee a mortgage lien on the real property and
improvements and
a security interest in the personal property described below;
NOW, THEREFORE,
the Mortgagor, in consideration of the aforesaid debt, and
also in consideration of the further sum of Three and No/100
($3.00) Dollars, to
it in hand paid by the Mortgagee,
receipt whereof is hereby
acknowledged,
and
for the
purpose of securing
the
Obligations
(as
hereinafter
defined),
has
granted,
bargained,
sold,
and released,
and by these
presents,
does grant,
bargain,
sell and release unto the Mortgagee,
its successors and assigns,
and
Mortgagor
does hereby
grant a security
interest in, the
following
property,
rights, and interests (collectively, the "PROPERTY"):
(a)
LAND.
The real
property
described in Exhibit A attached
hereto and
made a part hereof (the "LAND");
(b)
ADDITIONAL LAND. All additional lands,
estates 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 of this Security Instrument;
(c)
IMPROVEMENTS.
The
buildings,
structures,
fixtures,
additions,
enlargements,
extensions, modifications, repairs, replacements and improvements
now
or
hereafter
erected
or
located
on
the
Land
(collectively,
the
"IMPROVEMENTS");
(d)
EASEMENTS.
All easements,
rights-of-way or use,
rights,
strips and
gores of land,
streets,
ways,
alleys,
passages,
sewer rights,
water, water
courses,
water rights and powers,
air rights and development
rights,
and all
estates,
rights,
titles,
interests,
privileges,
liberties,
servitudes,
tenements,
hereditaments and appurtenances of any nature whatsoever, in any
way
now or
hereafter
belonging,
relating
or
pertaining
to
the
Land
and
the
Improvements and the reversions 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, to the center line thereof and all the estates, rights,
titles, interests,
rights of dower,
rights of
curtesy,
property,
possession,
claim and
demand
whatsoever,
both at law and in equity, of Mortgagor, in and to the Land and the
Improvements and every part and parcel thereof, with the
appurtenances
thereto;
and
(e)
OTHER
INTERESTS.
All
rights,
privileges,
interests,
tenements,
hereditaments and appurtenances thereto belonging,
including without limitation
all right, title and interest of Mortgagor in and to water,
minerals,
flowers,
shrubs,
crops,
trees,
timber and other
emblements
now or hereafter
located
therein, and the rents, issues and profits thereof, and any and all
fixtures now
or subsequently attached to or used in connection therewith;
(f)
FIXTURES AND PERSONAL
PROPERTY.
All machinery,
equipment,
fixtures
(including,
but not
limited
to,
all
heating,
air
conditioning,
plumbing,
lighting,
communications and elevator fixtures), furniture, software used in
or
to operate
any of the
foregoing
and other
property
of every kind and nature
whatsoever
owned by
Mortgagor,
or in
which
Mortgagor
has or shall
have an
interest,
now or
hereafter
located
upon the Land
and the
Improvements,
or
appurtenant
thereto,
and
usable
in
connection
with the
present
or future
operation
and
occupancy
of the Land
and the
Improvements
and all
building
equipment,
materials and supplies of any nature
whatsoever owned by Mortgagor,
or in which
Mortgagor has or shall have an interest,
now or hereafter
located
upon the
Land and the
Improvements,
or
appurtenant
thereto,
or
usable
in
connection
with the present or future
operation
and occupancy of the Land and
the
Improvements,
together
with all building
materials
and equipment now or
hereafter delivered to the Land or the Improvements and intended to
be installed
therein
(collectively,
the
"PERSONAL
PROPERTY"),
and the
right,
title and
interest
of
Mortgagor
in and to any of the
Personal
Property
which
may be
subject to any security interests, as defined in the Uniform
Commercial Code, as
adopted and enacted by the state or states
where any of the Property is located
(the "UNIFORM COMMERCIAL CODE"), and all proceeds and products of
the above;
(g)
LEASES AND
RENTS.
All
leases,
subleases,
subsubleases,
lettings,
licenses,
concessions or other agreements (whether written or oral) pursuant
to
which any person is granted a possessory
interest in, or right to use or occupy
all or any
portion of the Land and the
Improvements,
and every
modification,
amendment or other agreement relating to such leases,
subleases,
subsubleases,
or other
agreements
entered into in
connection
with such leases,
subleases,
subsubleases,
or other
agreements and every
guarantee of the
performance and
observance
of the
covenants,
conditions
and
agreements
to be performed and
observed by the other party
thereto,
heretofore
or
hereafter
entered
into,
whether
before or after the filing by or against
Mortgagor of any petition for
relief under any bankruptcy or insolvency laws (collectively,
the "LEASES") and
all right,
title and interest of Mortgagor,
its successors and assigns therein
and thereunder,
including,
without
limitation,
cash or securities
deposited
thereunder
to
secure
the
performance
by the
lessees
of their
obligations
2
thereunder and all rents, additional rents, rent equivalents,
moneys payable as
damages or in lieu of rent or rent equivalents,
royalties
(including,
without
limitation,
all oil and gas or other mineral
royalties
and bonuses),
income,
receivables,
receipts,
revenues,
deposits
(including,
without
limitation,
security, utility and other deposits),
accounts, cash, issues, profits, charges
for
services
rendered,
and other
consideration
of
whatever
form or nature
received
by or paid to or for the
account of or benefit
of
Mortgagor
or its
agents or employees from any and all sources arising from or
attributable to the
Property, including, all receivables, customer obligations,
installment payment
obligations and other
obligations now existing or hereafter
arising or created
out of the sale,
lease,
sublease,
license,
concession
or other grant of the
right
of the
use and
occupancy
of
property
or
rendering
of
services
by
Mortgagor,
and proceeds,
if any, from business
interruption
or other loss of
income
insurance
whether
paid or
accruing
before or after the
filing by or
against
Mortgagor of any petition for relief under any bankruptcy or
insolvency
laws
(collectively,
the
"RENTS")
and all
proceeds
from
the
sale or other
disposition
of the Leases
and the right to receive
and apply the Rents to the
payment of the Debt;
(h)
INSURANCE PROCEEDS.
All Insurance Proceeds in respect of the Property
under any Policies covering the Property,
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 Property;
(i)
CONDEMNATION AWARDS. All Awards, including interest thereon, which
may
heretofore
and
hereafter
be made with
respect to the
Property
by reason of
Condemnation,
whether
from
the
exercise
of
the
right
of
eminent
domain
(including,
but not limited to, any transfer made in lieu of or in anticipation
of the exercise of the right), or for a change of grade, or for any
other injury
to or decrease in the value of the Property;
(j)
BONDS,
DEPOSIT,
AND PERMITS.
All utility
service bonds and/or cash
deposits,
site improvement bonds and/or cash deposits,
building permits, sewer
connection
and/or tap-in
permits,
water
connection
and/or
tap-in
permits,
curb-cut
permits,
utility
service
agreements,
site work agreements with any
governmental
authority or public utility, and all other permits,
approvals and
contracts of any kind relating to the Land or Improvements;
(k)
WARRANTIES AND GUARANTIES.
All warranties and guaranties covering any
appliances
and fixtures now or hereafter
located on or placed upon the Land or
used in connection
with the
Improvements
including
without
limitation,
air
conditioning, heating and other appliances and equipment;
(l)
SURVEYS
AND
DOCUMENTS.
All
surveys,
agreements,
instruments,
contracts,
documents
of title,
choses in action
or
intangible
property
or
contract
rights of any kind now
existing
or
hereafter
arising or created or
entered in to related to the Land or the
Improvements or ownership or operation
of the Land or
Improvements
including,
but not
limited
to,
the
plans
and
specifications,
all construction,
architectural and other contracts,
purchase
orders, permits, approvals,
licenses,
franchises,
trademarks,
project logos,
building names,
surveys,
insurance policies,
bonds,
escrow funds,
easement,
exclusive agency licenses or leases and proceeds of any of the
foregoing;
(m)
SALES
AGREEMENTS.
All sales
agreements,
deposit
receipts,
escrow
agreements
and other
ancillary
documents
and
agreements
entered into which
respect to the sale to any
purchasers
of any part of the Land or any buildings
or structures on the Land,
together with all deposits and other proceeds of the
sale thereof;
3
(n)
LICENSES.
All licenses (including,
but not limited to, any operating
licenses), contracts, management contracts or agreements,
franchise agreements,
permits,
authorities or
certificates
required or used in connection
with the
ownership of, or the operation or maintenance of the Improvements;
(o)
NAMES
AND
TRADEMARKS.
All
names
under or by which the Land or the
Improvements
may at any time be operated
or known,
and all rights to carry on
business under any such names or any variant thereof, and all
trademarks,
trade
names, patents pending and goodwill;
(p)
TAX
CERTIORARI.
All refunds,
rebates or credits in connection
with
reduction in real estate taxes and assessments charged against the
Property as a
result of tax certiorari or any applications or proceedings for
reduction;
(q)
RIGHTS.
The right, in the name and on behalf of Mortgagor,
to appear
in and defend any action or proceeding
brought with respect to the Property and
to commence any action or proceeding to protect the interest of
Mortgagee in the
Property;
(r)
AGREEMENTS.
All
agreements,
contracts,
certificates,
instruments,
franchises, permits, licenses, plans, specifications and other
documents, now or
hereafter
entered
into,
and all rights
therein and
thereto,
respecting
or
pertaining to the use, occupation, construction,
management or operation of the
Land and any part
thereof
and any
Improvements
or any
business
or activity
conducted on the Land and any part thereof and all right,
title and interest of
Mortgagor therein and thereunder, including, without limitation,
the right, upon
the happening of any default hereunder,
to receive and collect any sums payable
to Mortgagor thereunder;
(s)
INTANGIBLES.
All
tradenames,
trademarks,
servicemarks,
logos,
copyrights,
goodwill,
books
and
records
and all other
general
intangibles
relating to or used in connection with the operation of the
Property;
(t)
ACCOUNTS.
All reserves,
escrows and deposit
accounts
maintained by
Mortgagor with respect to the Property;
(u)
CONVERSION. All proceeds of the conversion,
voluntary or involuntary,
of
any of the
foregoing
items
set
forth
in
subsections
(a)
through
(m)
including,
without
limitation,
Insurance
Proceeds
and Awards,
into cash or
liquidation claims; and
(v)
OTHER
RIGHTS.
Any and all other
rights of
Mortgagor
in and to the
items set forth above.
TO HAVE AND TO HOLD, all and singular the Property, unto the
Mortgagee, its
successors and assigns forever.
AND the
Mortgagor
covenants
with the
Mortgagee
that the
Mortgagor
is
indefeasibly
seized of a good and
marketable fee simple title to said Land and
has good and lawful
authority to mortgage said Land; that the Mortgagor
hereby
fully
warrants
the title to said Land and will
defend
the same
against
the
lawful claims of all persons whomsoever; and that said Land is free
and clear of
all
encumbrances
except taxes for the current year, a lien but not yet due and
payable,
and any
encumbrances
described in Schedule B of the title
insurance
policy accepted by Mortgagee.
4
PROVIDED,
ALWAYS,
that if the Mortgagor
shall pay unto the Mortgagee the
said
Obligations
(including any future
advances);
AND if the Mortgagor shall
duly,
promptly and fully
perform,
discharge,
execute,
effect,
complete and
comply
with
and
abide
by each and
every
of the
stipulations,
agreements,
conditions and covenants therein and in this Mortgage,
then this Mortgage shall
cease and be null and void; otherwise to remain in full force and
effect.
THIS
MORTGAGE
secures
the
following
obligations
(collectively,
the
"OBLIGATIONS"):
(a) the
obligations of Mortgagor to Mortgagee
under the Note;
(b) any and all advances or expenditures made by Mortgagee pursuant
to the terms
of this Mortgage;
(c) attorneys' fees, court costs, and other amounts which may
be due under the Note or this
Mortgage;
(d) the
obligations
of
Mortgagor to
Mortgagee under that certain hazardous
substances
indemnity
agreement of even
date herewith executed by Mortgagor in favor of Mortgagor; (e) any
and all other
indebtedness of Mortgagor to Mortgagee,
now existing or hereafter
arising,
of
whatever
class or
nature,
whether
or not now
contemplated
by the
parties,
including
future advances
pursuant to S.C. Code Ann. ss. 29-3-50 (as set forth
more fully below); and (f) any and all extensions,
renewals,
and modifications
of any of the foregoing.
Extensions,
renewals,
and
modifications of the debt
secured hereby, and future advances, may bear interest at a rate or
rates higher
than the rate borne by the Note or the other Obligations.
THIS MORTGAGE
shall secure not only existing
indebtedness
but all future
advances
(in
accordance
with
S.C.
Code
Ann.
ss.
29-3-50,
as
amended),
readvances,
and
additional
indebtedness
hereafter
arising
or
incurred
by
Mortgagor
to or in favor of
Mortgagee,
and any
notes
evidencing
the
same,
whether such advances or
indebtedness is obligatory or to be made at the option
of the Mortgagee,
or otherwise, to the same extent as if such future advance or
indebtedness
was made on the date of the
execution of this
Mortgage,
but the
indebtedness
secured
by this
Mortgage
shall
not
exceed at any one time the
maximum
principal amount of One Million Five Hundred Thirty Thousand and
00/100
Dollars ($1,530,000.00),
plus interest thereon,
reasonable attorneys' fees and
court costs, and plus advancements for taxes,
insurance
premiums,
and repairs
made by Mortgagee.
All indebtedness incurred after the date hereof by Mortgagor
in favor of Mortgagee shall
conclusively be deemed to be a future advance under
this Mortgage and entitled to the
protection of this provision and the security
of this Mortgage.
Such future indebtedness may bear interest at a rate or rates
greater than the rate set forth in the Note, or the other
Obligations.
Interest
on the Obligations
will be deferred,
accrued,
or
capitalized,
but Mortgagee
shall not be required to defer,
accrue,
or capitalize
any interest
except as
provided in the Obligations.
AND the Mortgagor does hereby expressly covenant and agree as
follows:
1.
ASSIGNMENT OF RENTS AND PROFITS.
As further
security for the payment
of the
Obligations
and
for the
faithful
performance
of all the
covenants,
agreements,
terms and
provisions
of this
Mortgage,
Mortgagor
hereby sells,
mortgages, transfers, and assigns unto Mortgagee and grants
Mortgagee a security
interest in all the right,
title and
interest of the
Mortgagor
in and to all
current and future Leases and Rents;
it being
intended by Mortgagor
that this
assignment constitutes a present,
absolute assignment and not an assignment for
additional
security only, and does hereby direct each and all of the tenants
of
the Property to pay such rents, as they may now be due or shall
hereafter become
due to the said
Mortgagee,
upon demand for payment
thereof by said Mortgagee.
Nevertheless,
Mortgagee grants to Mortgagor a revocable
license to collect and
receive the Rents until demand for payment thereof by said
Mortgagee;
it being
understood
and agreed,
however,
that no such demand
shall be made unless and
until there has occurred an Event of Default hereunder;
provided, however, that
the license to collect or continue
collecting,
as aforesaid,
by the Mortgagor
5
shall not
operate to permit the
collection
of any rents more than thirty (30)
days in advance of the date same are due under the terms and
provisions of said
lease or leases.
2.
MAINTENANCE OF PROPERTY. Mortgagor shall maintain the Property in
good
condition and repair and shall neither permit nor allow waste
thereof. Mortgagor
shall promptly repair or restore any portion of the Property which
is damaged or
destroyed by any cause
whatsoever and shall promptly pay when due all costs and
expenses of such repair or restoration. Mortgagor shall not remove,
demolish, or
materially
alter any
improvement
or fixture which is now or hereafter part of
the Property and shall cut no timber on the Property without the
express written
consent of Mortgagee. Mortgagee shall be entitled to specific
performance of the
provisions of this paragraph.
3.
HAZARD AND FLOOD
INSURANCE.
Mortgagor shall maintain with respect to
all completed buildings, improvements,
fixtures, and tangible personal property
which are now or hereafter
part of the
Property,
fire and
extended
coverage
insurance,
including
windstorm and hail,
and earthquake
insurance,
and such
other hazard insurance as Mortgagor may require.
If any portion of the Property
is located in a federally
designated special flood hazard area, Mortgagor shall
also obtain a flood insurance
policy in the maximum amount
available under the
National Flood Insurance Act of 1968, but not to exceed the
replacement value of
all
buildings
and
improvements
located on the Property that are located in a
federally
designated
special flood hazard area.
All such
insurance
shall be
payable to Mortgagee as the interest of Mortgagee may appear
pursuant to the New
York standard form of mortgagee clause or such other form of
mortgagee clause as
may be
required
by the
Mortgagee
and shall not be
cancelable
by either the
insurer or the insured without at least thirty (30) days prior
written notice to
the Mortgagee.
Mortgagor shall keep the Property continuously insured as herein
re
