Wraparound Mortgage
This Mortgage is made ________________________________________ (date) ,
by _______________________________________ (Name of Mortgagee) , a corporation
organized and existing under the laws of _______________________________ (Name
of State) , with its principal office located at ____________________________________
_______________________________________________________________________
(street address, city, county, state, zip code) , hereinafter referred to as Mortgagee , and
_______________________________________ (Name of Mortgagor) , of ___________
________________________________________________________________________
(street address, city, county, state, zip code) , hereinafter referred to as Mortgagor .
Whereas, Mortgagor has executed and delivered to Mortgagee a wraparound note
for $_____________ of even date (the Note ), in which Mortgagor promises to pay
Mortgagee the principal sums due under the Note in lawful money of the United States,
with interest at the rate and times and in the manner and according to the terms and
conditions specified in the Note, all of which are incorporated in this Mortgage by
reference;
Now, therefore, for and in consideration of the indebtedness, and as security for
payment to Mortgagee of the amounts due under the Note aggregating a principal
indebtedness of $______________ with interest, and all other sums provided for in the
Note and in this Mortgage , according to their respective terms and conditions, and any
extensions or modifications of the same, and for performance of the agreements,
conditions, covenants, provisions, and stipulations contained in the Note and in this
Mortgage , and intending to be legally bound by this Mortgage , Mortgagor has mortgaged
and warranted, granted, conveyed, bargained, sold, released, confirmed, and by this
instrument does now mortgage and warrant, grant, convey, bargain, sell, release, confirm,
and mortgage to Mortgagee all of Mortgagor's estate, right, title and interest in, to, and
under the following described property, whether now owned or held or later acquired:
1. The parcel of land described in Exhibit A attached to and made a part of this
Mortgage , together with all buildings and other improvements now or later erected on the
land;
2. All fixtures, appliances, machinery, furniture, inventory, materials, equipment,
and other articles of personal property of any nature which are now or later will be
installed in, attached to, or situated in or upon the above described real estate or any
buildings and improvements now or later erected on the same, or used or intended to be
used in connection with the real estate, or in the operation of any buildings and
improvements now or later erected on the real estate, or in the operation or maintenance
of any such buildings or improvements, plant, or business situated on the real estate,
whether or not the personal property is or shall be affixed to the real estate, including, but
not limited to, all articles of personal property listed on Exhibit B attached to and made a
part of this Mortgage ; and
3. Any and all tenements, hereditaments, and appurtenances belonging to the real
estate or any part of the real estate mortgaged or intended to be mortgaged by this
instrument, or in any way appertaining to the same; and all streets, alleys, passages, ways,
water courses, and all easements and covenants now existing or later created for the
benefit of Mortgagor or any subsequent owner or tenant of the mortgaged real estate over
ground adjoining the mortgaged real estate, and all rights to enforce the maintenance of
the same; and all other rights, liberties, and privileges of whatever kind or character, and
the reversions and remainders, income, rents, issues, and profits arising from the same;
and all the estate, right, title, interest, property, possession, claim, and demand of any
kind, at law or in equity, of mortgagor in and to the real estate or any part of the real
estate.
Mortgagor also does now grant to Mortgagee a security interest under the
Uniform Commercial Code in and to: all fixtures, appliances, machinery, furniture,
inventory, materials, equipment, and other articles of personal property of any nature
which are now or later will be installed in, attached to, or situated in or upon the above
described real estate or any buildings and improvements now or later erected on the real
estate, or used or intended to be used in connection with the real estate, or in the
operation of any buildings and improvements now or later erected on the same, or in the
operation or maintenance of any such buildings or improvements, plant, or business
situated on the real estate, whether or not the personal property is or shall be affixed to
the same, including, but not limited to, all articles of personal property listed on Exhibit
B attached to and made a part of this Mortgage ; and all leases now existing or later
created of all or any portion of the real estate described on Exhibit A, including, but not
limited to, those leases with tenants listed on Exhibit C attached to and made a part of
this Mortgage and all rents and profits arising under the leases; and all proceeds of the
conversion, voluntary or involuntary, of any of the foregoing into cash or liquidated
claims, including, but not limited to, proceeds of insurance and condemnation awards.
All of the above-mentioned real estate, buildings and improvements, fixtures,
machinery, furniture, equipment, tenements, hereditaments, and appurtenances, and other
property interests are collectively referred to in this Mortgage as the Mortgaged
Property .
To have and to hold the Mortgaged Property to Mortgagee, to Mortgagee's own
use forever, subject, however to the terms and conditions in this Mortgage . It is agreed
that the Mortgaged Property has been previously encumbered by and presently remains
encumbered by the liens described in Exhibit D , each lien encumbering a portion of the
Mortgaged Property .
Provided always, and this instrument is upon the condition that, if Mortgagor
pays to Mortgagee the principal sum mentioned in the Note , and the interest and all other
sums payable by Mortgagor to Mortgagee as are secured by this Mortgage , in accordance
with the provisions of the Note and this Mortgage , at the times and in the manner
specified, without deduction, fraud, or delay, and if Mortgagor performs and complies
with all the agreements, conditions, covenants, provisions, and stipulations contained in
this Mortgage and in the note, then this Mortgage and the estate granted by it shall cease
and become void.
Mortgagor represents, covenants, and warrants to and with Mortgagee that until
the indebtedness secured by this Mortgage is fully repaid:
1. Payment and Performance
Mortgagor shall pay to Mortgagee, in accordance with the terms of the Note and
this Mortgage , the principal and interest, and all other sums set forth in the Note and this
Mortgage ; shall perform and comply with all the agreements, conditions, covenants,
provisions, and stipulations of the Note, collateral assignment of rents, and this Mortgage ;
and shall timely perform all of its obligations and duties as landlord under any lease (an
occupancy lease ) of all or any portion of the Mortgaged Property now or later in effect.
2. Performance of Senior Obligation
This is a wraparound mortgage ; it is subject and subordinate to and wraps around
those certain mortgages described on Exhibit D attached to and made a part of this
Mortgage (collectively the senior obligation ).
A. Mortgagor shall perform and comply with all of the terms,
covenants, and conditions of this Mortgage and the senior obligation except that payment
of interest and principal due and owing under the senior obligation shall be made by the
holder of this Mortgage so long as the payments required to be made under this M ortgage
are made when due. To the extent required by the senior obligation and not paid by the
tenant of the property, Mortgagor shall make deposits with Mortgagee for the payment of
real estate taxes and insurance premiums, or make such deposits, or cause such deposits
to be made with the holder of the senior obligation.
B. The holder of the Notes secured by this Mortgage agrees to make or cause
to be made all regular installment payments of principal and interest and deposits, if any,
for real estate taxes, water rates, sewer charges, and insurance premiums, payable in the
calendar year in which the Note becomes due pursuant to the senior obligation, by the
date due under the same, including grace periods, so long as Mortgagor shall make the
payments and deposits required under the terms of this Mortgage and the notes it secures.
If Mortgagee fails to so pay any payments of principal and interest or such deposits, in
addition to the other rights and remedies which Mortgagor may have at law or under this
Mortgage , Mortgagor may pay such sums due to the holder of the senior obligation
which is in default and may deduct the amount so paid from the next regular installment
of principal and interest or deposits due under this Mortgage .
C. Provided that Mortgagor or any owner of the property is not in default in
the performance of the terms of this Mortgage , and if Mortgagee fails to make payments
required to be made under the senior obligation, Mortgagee will indemnify and save
harmless Mortgagor from any damage sustained by reason of such failure to the extent of
Mortgagee's interest in this Mortgage and, if Mortgagee fails to make the required
payments when due, Mortgagor shall, in addition to any right it may have in law or
equity, have the option to purchase Mortgagee's equity in this Mortgage for one dollar.
D. If Mortgagor should prepay the Note secured by this Mortgage , in accordance
with the terms of the Note, the proceeds of such prepayment shall be disposed of by
Mortgagee as follows: (1) first, by payment to the holders of the senior obligation, in
prepayment of the senior obligation to the extent permitted by the senior obligation
(together with any prepayment penalty required to be paid upon such permitted
prepayment of the senior obligation ); and (2) second, by retaining and holding any
balance remaining in trust (or, if required by Mortgagor, by depositing the same in an
escrow fund with an escrow agent reasonably satisfactory to Mortgagor ) to be used
solely to prepay the senior obligation when, as, and if such prepayment is permitted
under the terms of the senior obligation (together with any prepayment penalty required
to be paid in connection with such prepayments) until the senior obligations are paid in
full.
E. If the unpaid principal balances of the senior obligations are reduced by the
holders of the mortgages applying insurance proceeds or condemnation awards in
reduction of the same or by prepayments made by Mortgagor with the prior written
consent of Mortgagee so that Mortgagee's obligation under the same to pay to the holders
of the senior obligations the unpaid principal balance of the mortgages as provided above
is similarly reduced, then and in that event, the obligations of Mortgagor under this
Mortgage shall be reduced by an equivalent amount, such equivalent amount to be
deducted from the payment to be made by Mortgagor to Mortgagee under this Mortgage .
F. Mortgagor shall furnish to Mortgagee promptly copies of all notices of default
which it may receive from the holder of any prior lien. Mortgagee similarly agrees to
forward to Mortgagor copies of all letters and notices received from the holder of any
prior lien.
G. Mortgagee agrees that wherever the provisions of this Mortgage provide for a
consent by Mortgagee, or other discretionary action by Mortgagee, Mortgagee shall not
unreasonably withhold its consent or so act at the request of Mortgagor, provided,
however, that the holders of the senior obligation shall give their consent or so act.
H. Except for its liability to account for funds actually received by Mortgagor,
anything contained in this Mortgage to the contrary notwithstanding, Mortgagee shall not
be personally liable for a money judgment for any breach of any agreement contained in
this Mortgage which imposes any obligation upon Mortgagee.
I. Mortgagor designates Mortgagee its agent and attorney-in-fact to perform or
observe on behalf of Mortgagor any covenant or condition which Mortgagor fails to
perform or observe within any time limits provided for the same under the senior
obligation, and any advances made by Mortgagee in connection with such performance
or observance shall be repaid by Mortgagor on demand, with interest at the default rate
(as the term is defined in the notes) and the amount so advanced, with interest as
provided above, shall be secured by this M ortgage . The performance or observance of
such covenant or condition by Mortgagee shall not prevent Mortgagor's failure so to
perform or observe from constituting a default by Mortgagor under this M ortgage . In
performing or observing any such covenant or condition, Mortgagee shall have the right
to enter upon the Mortgaged Property at any time. Upon receipt by Mortgagee from an
obligee or from Mortgagor of any notice or copy of a notice of default under the senior
obligation, Mortgagee may rely on the notice and take any action permitted by this
Section 2 or elsewhere in this Mortgage to remedy such default, notwithstanding that the
existence of such default or the nature of it may be questioned or denied by Mortgagor.
No action taken by Mortgagee directed toward curing such default, or failure of
Mortgagee to take such action under the senior obligation, shall give rise to any liability
of Mortgagee to Mo r tgagor, and Mortgagor waives any right of action or claim against
Mortgagee arising from any act of Mortgagee directed to curing such default or any
failure of Mortgagee so to act.
3. Maintenance of Mortgage Property
Mortgagor shall keep and maintain or cause to be kept and maintained all
buildings and improvements, now or at any later time erected on the Mortgaged
Property, and the sidewalks and curbs abutting them, in good condition and repair, and
will make or cause to be made, as and when necessary for such purpose, all repairs,
renewals, and replacements, structural and nonstructural, exterior and interior, ordinary
and extraordinary, foreseen and unforeseen. Mortgagor shall abstain from and shall not
permit the commission of waste in or about the mortgaged property . Mortgagor shall not
remove or demolish, or alter the structural character of, any building erected at any time
on the Mortgaged Property, without the prior written consent of Mortgagee, which
consent shall not be unreasonably withheld or delayed.
4. Insurance
Mortgagor shall keep the Mortgaged Property continuously insured against loss
or damage by fire and all risks covered by the broad extended coverage endorsement, and
against such other hazards as Mortgagee may from time to time require, in the amount of
at least the full replacement value of all the buildings and improvements not subject to
reduction by application of a coinsurance factor or otherwise. Mortgagor shall also
continuously maintain comprehensive general public liability insurance against claims for
bodily injury or death and property occurring in or about the Mortgaged Property or
arising out of the ownership, use, or operation of the Mortgaged Property , in the amount
of at least $ ___________________ (dollar amount) per occurrence. All policies,
including policies for any amounts carried in excess of the required minimum and
policies not specifically required by Mortgagee, shall be with companies reasonably
satisfactory to Mortgagee, shall be in form reasonably satisfactory to Mortgagee, shall be
maintained in full force and effect, shall (with respect to hazard insurance) be endorsed
with a standard mortgagee clause in favor of Mortgagee, not subject to contribution, shall
(with respect to liability insurance) name Mortgagee as an additional insured, and shall
provide for at least (e.g.,10) _____ days' notice of cancellation to Mortgagee. The
originals of all policies with premiums paid shall be delivered to Mortgagee. If the
insurance, or any part of it, shall expire, or be withdrawn, or become void or unsafe by
Mortgagor's breach of any condition of the insurance, or become void or unsafe by
reason of the failure or impairment of the capital of any company in which the insurance
may then be carried, then Mortgagor shall place new insurance on the mortgaged
property satisfactory to Mortgagee . The originals of all renewal policies, with premiums
paid, shall be delivered to Mortgagee before expiration of the old policies. In the event of
loss, Mortgagor will give immediate notice of the loss to Mortgagee, and Mortgagee may
make proof of loss if not made promptly by Mortgagor . Each insurance company
providing hazard insurance is authorized and directed to make payment under such
insurance, including return of unearned premiums, directly to Mortgagee instead of to
Mortgagor and Mortgagee, jointly, and Mortgagor appoints Mortgagee, irrevocably, as
Mortgagor's attorney-in-fact to endorse any draft for the same. Mortgagee shall have the
right to retain and apply the proceeds of any such insurance, at its election, to reduction
of the indebtedness secured by this Mortgage , or to restoration or repair of the property
damaged, except that Mortgagee shall be required to make any proceeds of any such
insurance available for restoration or repair of the property damaged from time to time as
the work progresses if: (1) Mortgagor is not then in default under any of the terms,
covenants, or conditions of this Mortgage or of the Note; and (2) Mortgagee is
reasonably satisfied that such proceeds, together with such other funds as Mortgagor
shall deposit with Mortgagee, shall be sufficient to pay the entire cost of restoring and
rebuilding the Mortgaged Property to substantially the same condition that existed
immediately prior to the casualty. Such policies of insurance and all renewals of the
policies are by this Mortgage assigned to Mortgagee as additional security for payment of
the indebtedness secured by this Mortgage . If Mortgagee becomes the owner of the
Mortgaged Property or any part of the property by foreclosure or otherwise, such
policies, including all right, title, and interest of Mortgagor under the policies, shall
become the absolute property of Mortgagee . Notwithstanding the foregoing, it is agreed
that the rights of Mortgagee to receive and retain the originals of insurance policies, to
make proof of loss, to receive payment of insurance proceeds, and to determine whether
insurance proceeds should be employed for restoration or repair, shall be subject to the
rights of the tenants under their leases and the obligee with respect to the same, as such
rights are set forth in the leases and the senior obligation.
Notwithstanding the foregoing, unless otherwise required by the senior
obligation, Mortgagor shall not be required to furnish any such hazard insurance on those
portions of the Mortgaged Property leased to any tenant so long as such tenant shall be
furnishing hazard insurance or shall self-insure as to such hazards in accordance with the
provisions of its lease and shall comply in all respects with the requirements for such
insurance expressed in the lease as conditions to such tenants being a self-insurer.
5. Taxes and Other Charges
Mortgagor shall pay or cause payment when due and payable and before interest
or penalties are due, without any deduction, defalcation, or abatement: all taxes,
assessments, assessments for public improvements, water and sewer rents and all other
charges or claims which may be assessed, levied, or filed at any time against Mortgagor,
the Mortgaged Property or any part of the property, or against the interest of Mortgagee
in the Mortgaged Property, or which by any present or future law may have priority over
the indebtedness secured by this Mortgage either in lien or in distribution out of the
proceeds of any judicial sale. Mortgagor shall produce to Mortgagee, within (e.g., 30)
_____ days after request, receipts for the payment of such taxes and other charges
specified in this paragraph, or other evidence of payment reasonably satisfactory to
Mortgagee. If, however, Mortgagor in good faith and by appropriate legal action shall
contest the validity of any such item, or the amount of it, and shall have established a
reserve with Mortgagee for the payment of the item in such amount as Mortgagee may
reasonably require, then Mortgagor shall not be required to pay the item or to produce the
required receipts while the reserve is maintained and so long as the contest operates to
prevent collection, is maintained and prosecuted with diligence, and shall not have been
terminated or discontinued adversely to Mortgagor . Further, Mortgagor will not apply
for or claim any deduction, by reason of this Mortgage , from the taxable value of all or
any part of the Mortgaged Property. No credit shall be claimed or allowed on the interest
or principal payable on the note because of any taxes or other charges paid. Mortgagor
agrees to comply with the obligation to escrow taxes on a monthly basis as specified in
the senior obligation.
6. Corporate Existence and Taxes
If Mortgagor or any successor or grantee or mortgagor is a corporation, during the
time it holds title to the Mortgaged Property, it shall keep in effect its existence and
rights as a corporation under the laws of the state of its incorporation and its right to own
property and transact business in the state in which the Mortgaged Property is situated
during the entire time that it has any ownership interest in the Mortgaged Property. For
all periods during which title to the Mortgaged Property or any part of the property shall
be held by a corporation or association subject to corporate taxes or taxes similar to
corporate taxes, Mortgagor shall file returns for such taxes with the proper authorities,
bureaus, or departments and it shall pay, when due and payable and before interest or
penalties are due, all taxes owing by Mortgagor to the United States, to such state of
incorporation, and to the state in which the Mortgaged Property is situated and any
political subdivision of the same, and shall produce to Mortgagee receipts showing
payment of any and all such taxes, charges, or assessments prior to the last dates upon
which such taxes, charges, or assessments are payable without interest or penalty charges,
and within (e.g., 10) _____ days of receipt of all settlements, notices of deficiency or
overassessment, or any other notice pertaining to Mortgagor's tax liability, which may be
issued by the United States, such state of incorporation, the state in which the Mortgaged
Property is situated or any political subdivision of the same.
7. Documentary and Other Stamps
If at any time the United States, the state in which the Mortgaged Property is
located or any political subdivision of the same, or any department or bureau of any of
the foregoing, shall require documentary, revenue, or other stamps on or with respect to
this M ortgage or the note secured by this Mortgage beyond those affixed or obtained
upon the date of this Mortgage , then Mortgagor on demand shall pay for them with any
interest or penalties payable on the same.
8. Future Taxes
If any law or ordinance shall be adopted imposing a tax (other than income,
franchise, or inheritance taxes) directly or indirectly on Mortgagee with respect to the
Mortgaged Property , the value of Mortgagor's equity in the property, or the indebtedness
evidenced by the note and secured by this Mortgage , then Mortgagee, at its election, shall
have the right at any time to give Mortgagor written notice declaring that the principal
debt, with interest and other appropriate charges, shall be due on a specified date not less
than (e.g., 60) _____ days afterward; provided, however, that such election shall be
ineffective if, prior to the specified date, Mortgagor lawfully pays the tax (in addition to
all other payments required under this Mortgage ) and agrees to pay the tax whenever it
becomes due and payable, which agreement shall then constitute a part of this Mortgage .
9. Security Agreement
This Mortgage constitutes a security agreement under the Uniform Commercial
Code and Mortgagor grants, conveys, and assigns to Mortgagee a security interest in all
that property (and the proceeds of same) included in the Mortgaged Property which
might otherwise be deemed personal property . Mortgagor shall execute, deliver, file, and
refile any financing statements, continuation statements, or other security agreements
Mortgagee may require from time to time to confirm the lien of this Mortgage with
respect to such property.
10. Compliance with Law and Regulations
Mortgagor shall at all times comply or cause the Mortgaged Property to comply
with all laws, ordinances, regulations, and orders of all federal, state, municipal and other
governmental authorities relating to the Mortgaged Property.
11. Hazardous or Toxic Materials
Mortgagor shall ensure that the Mortgaged Property is maintained in compliance
with, and shall not cause or permit the Mortgaged Property to be in violation of, any
federal, state, or local laws, ordinances or regulations relating to industrial hygiene or to
the environmental conditions (hazardous materials laws) on, under, about, or affecting
the Mortgaged Property . Neither Mortgagor nor any of its tenants shall use, generate,
manufacture, store, or dispose of on, under, or about the Mortgaged Property or transport
to or from the Mortgaged Property any flammable explosives, radioactive materials,
hazardous wastes, toxic substances, or related materials, including but not limited to any
substances defined as or included in the definition of hazardous substances, hazardous
wastes, hazardous materials, or toxic substances under any applicable federal or state
laws or regulations. Mortgagor shall advise Mortgagee in writing promptly upon notice
of: (1) any and all enforcement, cleanup, removal, or other governmental or regulatory
actions instituted, completed or threatened pursuant to any applicable hazardous
materials laws; (2) all claims made or threatened by any third party against Mortgagor ,
the lessee, or the Mortgaged Property relating to damage, contribution, cost recovery
compensation, loss, or injury resulting from any hazardous materials; and (3)
Mortgagor's discovery of any occurrence or condition on any real property adjoining or
in the vicinity of the Mortgaged Property that could cause the Mortgaged Property or
any part of it to be subject to any restrictions on the ownership, occupancy,
transferability, or use of the Mortgaged Property under any hazardous materials laws.
Mortgagor shall, at its expense, and after obtaining the written consent of Mortgagee,
take all necessary remedial actions in response to the presence of any hazardous
materials on, under, or about the Mortgaged Property.
12. Inspection
Mortgagee and any persons authorized by Mortgagee shall have the right at any
time, upon reasonable notice to Mortgagor , to enter the Mortgaged Property at a
reasonable hour to inspect and photograph its condition and state of repair and
Mortgagee shall further have the right but not the obligation to implement any repairs it
may deem necessary.
13. Declaration of Set-Off
Within (e.g., 10) ______ days after any request to do so by Mortgagee,
Mortgagor shall certify to Mortgagee or to any other person or entity requested by
Mortgagee , in a writing duly acknowledged, the amount of principal, interest, and other
charges then owing on the note, and whether Mortgagor claims any set-offs or defenses
against Mortgagor's obligation to pay such amounts. Within (e.g., 10) ____ days after
any request to do so by Mortgagor, Mortgagee shall certify to Mortgagor or to any other
person or entity that Mortgagor requests, in a writing duly acknowledged, the amount of
principal, interest and other charges then owing on the Note, and whether there are any
defaults by Mortgagor under this Mortgage or the Note.
14. Required Notices
Mortgagor shall notify Mortgagee promptly of the occurrence of any of the
following:
A. A fire or other casualty causing damage to any portion of the Mortgaged
Property in excess of $ ___________ (dollar amount) ;
B. Receipt of notice of condemnation of any portion of the Mortgaged
Property;
C. Receipt of any notice from any governmental authority relating to the
structure, use, or occupancy of the Mortgaged Property other than notices costing
less than $ ____________ (dollar amount) to cure;
D. Substantial change in the occupancy of the Mortgaged Property;
E. Receipt of any notice of default from the obligee or the holder of any other
lien, encumbrance, or security interest in or upon the Mortgaged Property ; or
F. Commencement of any litigation affecting the Mortgaged Property.
15. Condemnation
Subject to the provision of the tenant leases and the senior obligation respecting
condemnation:
A. In the event of any condemnation or taking of any part of the Mortgaged
Property by eminent domain, alteration of the grade of any street, or other injury to or
decrease in the value of the Mortgaged Property by any public or quasi-public authority
or corporation, all proceeds (that is, the award or agreed compensation for the damages
sustained) allocable to Mortgagor shall be applicable first to payment of the indebtedness
secured by this Mortgage , subject only to the rights of the obligee. No settlement for the
damages sustained in an amount less than that required to fully pay this Mortgage shall
be made by Mortgagor without Mortgagee's prior written approval. Receipt by
Mortgagee of any proceeds less than the full amount of the then outstanding debt shall
not alter or modify Mortgagor's obligation to continue to pay the installments of
principal, interest, and other charges specified in the Note and in this Mortgage . All the
proceeds shall be applied in the order and in the amounts that Mortgagee, in Mortgagee's
sole discretion, may elect, to the payment of principal (whether or not then due and
payable), accrued interest or any sums secured by this Mortgage , or toward payment to
Mortgagor, on such reasonable terms as Mortgagee may specify, to be used for the sole
purpose of altering, restoring, or rebuilding any part of the Mortgaged Property which
may have been altered, damaged, or destroyed as a result of the taking, alteration of grade
or other injury to the Mortgaged Property, except that Mortgagee shall make any
proceeds of any such condemnation received by Mortgagee available for restoration or
repair of the property condemned from time to time as the work progresses if: (1)
Mortgagor is not then in default under any of the terms, covenants, or conditions of this
Mortgage or the senior obligation; (2) Mortgagee is reasonably satisfied that such
proceeds, together with such other funds as Mortgagor shall deposit with Mortgagee,
shall be sufficient to pay the entire cost of restoring and rebuilding that portion of the
Mortgaged Property which has not been condemned to substantially the same condition
that existed with respect to such remaining portion of the Mortgaged Property
immediately prior to the condemnation; and (3) Mortgagee is reasonably satisfied that the
Mortgaged Property, as restored and rebuilt, will provide adequate security for the
repayment of the indebtedness secured by this Mortgage in the manner set forth in the
Note.
B. If prior to the receipt of the proceeds by Mortgagee the Mortgaged
Property shall have been sold on foreclosure of this M ortgage , Mortgagee shall have the
right to receive the proceeds to the extent of any deficiency found to be due to Mortgagee
in connection with the foreclosure sale, with legal interest on the same.
C. Nothing in this Section shall limit the rights otherwise available to
Mortgagee, at law or in equity, including the right to intervene as a party to any
condemnation proceeding.
16. Right to Remedy Defaults
If Mortgagor should fail to pay real estate or other taxes, assessments, water and
sewer rents, corporate taxes, sums due under the senior obligation, or insurance
premiums, or fail to make necessary repairs, or permit waste, or fail to perform any of its
obligations under any lease, or shall fail to perform any of its other obligations under this
Mortgage or under the senior obligation or the Note, then Mortgagee, at its election and
without notice to Mortgagor, shall have the right to make any payment or expenditure
and to take any action which Mortgagor should have made or taken, or which Mortgagee
deems advisable to protect the security of this Mortgage or the Mortgaged Property ,
without prejudice to any of Mortgagee's rights or remedies available under this Mortgage
or otherwise, at law or in equity. All such sums, including attorney's fees, as well as
costs, advanced by Mortgagee shall be due immediately from Mortgagor to Mortgagee,
shall be secured by this M ortgage , and shall bear interest until the date of repayment at
the default rate (as that term is defined in the Note ).
17. Events of Default
The following shall constitute events of default under this Mortgage :
A. Failure of Mortgagor to pay an installment of interest, principal, or any
other sum, on the date when it is due under the note or this Mortgage ;
B. Mortgagor's nonperformance of or noncompliance with any of the
agreements, conditions, covenants, provisions, or stipulations contained in the
Note or in this Mortgage , or in any other document securing the Note;
C. Any assignment for the benefit of creditors made by Mortgagor;
D. Appointment of a receiver, liquidator, or trustee of Mortgagor or of any of
the property of Mortgagor; insolvency of Mortgagor or the adjudication of
Mortgagor as a bankrupt; or the filing of any petition for the bankruptcy,
reorganization, or arrangement of Mortgagor pursuant to the federal Bankruptcy
Act or any similar statute, or the institution of any proceeding for the dissolution
or liquidation of Mortgagor;
E. The occurrence of a default under the terms of the senior obligation;
F. Should any federal or state tax lien or any claim or lien for labor or
materials be filed of record against Mortgagor or the Mortgaged Property or any
part of the property and not be removed by payment or bond within (e.g., 30)
_____ days from the date of recording of the lien;
G. Should final judgment for the payment of money be rendered against
Mortgagor and Mortgagor shall not discharge the same or cause it to be
discharged within (e.g., 30) ______ days from the entry of the judgment, or shall
not appeal from the judgment or from the order, decree, or process on which or
pursuant to which the judgment was granted, based or entered, and secure a stay
of execution pending such appeal;
H. Material breach of any warranty or material untruth of any representation
of Mortgagor contained in this Mortgage or the Note; or
I. If Mortgagor or any person acting by, for, or at the direction of
Mortgagor shall purchase or take assignment of Mortgagee's interest in the first
Mortgage .
18. Remedies
A. Upon the happening of any event of default, the entire unpaid balance of
the principal, the accrued interest and all other sums secured by this Mortgage shall
become immediately due and payable, at the option of Mortgagee, without further notice
or demand.
B. When the entire indebtedness shall become due and payable, either
because of maturity or because of the occurrence of any event of default, or otherwise,
then Mortgagee immediately shall have the following remedies, in addition to all other
remedies available to Mortgagee at law or equity:
1. Foreclosure
Mortgagee may institute an action of Mortgage foreclosure against the
Mortgaged Property , or take such other action at law or in equity for the
enforcement of this Mortgage and realization on the Mortgage security or any
other security in this Mortgage or elsewhere provided for, as the law may allow,
and may proceed to final judgment and execution for the entire unpaid balance of
the principal debt, with interest at the rates stipulated in the Note to the date of
default, and subsequently at the default rate (as that term is defined in the Note ),
together with all other sums due by Mortgagor in accordance with the provisions
of the Note and this Mortgage , and all sums which may have been advanced by
Mortgagee in accordance with Section 15 of this Mortgage , all costs of suit,
together with interest at the default rate on any judgment obtained by Mortgagee
from and after the date of any judicial sale until actual payment is made of the full
amount due Mortgagee , and a reasonable attorney's fee for collection.
2. Possession
Mortgagee may enter into possession of the Mortgaged Property,
with or without legal action, collect from the property all rentals (which terms
shall also include sums payable for use and occupation) and, after deducting all
costs of collection and administration expense, apply the net rentals to any or all
of the following in such order and amounts as Mortgagee, in Mortgagee's sole
discretion, may elect: the payment of taxes, water and sewer rents, charges and
claims, insurance premiums and all other carrying charges, and to the
maintenance, repair, or restoration of the Mortgaged Property, and on account
and in reduction of the principal or interest, or both, secured by this Mortgage . In
and for that purpose Mortgagor by this Mortgage assigns to Mortgagee all rentals
due and to become due under any lease or leases or rights to use and occupation
of the Mortgaged Property created in the future, as well as all right and remedies
provided in such lease or leases or at law or in equity for the collection of the
rentals.
3. Receiver
Mortgagee, without regard to the value or occupancy of the security or the
solvency of Mortgagor, shall be entitled as a matter of right if it so elects to the
appointment of a receiver to enter upon and take possession of the Mortgaged
Property and to collect all rents, revenues, issues, income, products, and profits of
the Mortgaged Property and apply same as the court may direct. The receiver
shall have all rights and powers permitted under the laws of the state where the
Mortgaged Property is located and such other powers as the court making such
appointment shall confer. The expenses, including receiver's fees, attorney's fees,
costs, and agent's compensation, incurred pursuant to the powers here contained
shall be secured by this Mortgage . The right to enter and take possession of and to
manage and operate the Mortgaged Property, and to collect the rents, issues, and
profits of the property, whether by a receiver or otherwise, shall be cumulative to
any other right or remedy under this Mortgage or afforded by law, and may be
exercised concurrently with or independently of the same. Mortgagee shall be
liable to account only for such rents, issues, and profits as are actually received by
Mortgagee . Notwithstanding the appointment of any receiver or other custodian,
Mortgagee shall be entitled as pledgee to the possession and control of any cash,
deposits, or instruments at the time held by, or payable or deliverable under the
terms of this Mortgage , to Mortgagee.
C. Mortgagee shall have the right, from time to time, to bring an appropriate
action to recover any sums required to be paid by Mortgagor under the terms of this
Mortgage and the Note, as they become due, without regard to whether or not the
principal indebtedness or any other sums secured by the Note and this Mortgage shall be
due, and without prejudice to the right of Mortgagee subsequently to bring an action of
mortgage foreclosure, or any other action, for any default by Mortgagor existing at the
time the earlier action was commenced.
D. Mortgagee shall have the power and authority to institute and maintain at
any time and from time to time any suits and proceedings as Mortgagee may deem
advisable: (1) to prevent any impairment of the Mortgaged Property by any acts which
may be unlawful or any violation of this Mortgage ; (2) to preserve or protect its interest
in the Mortgaged Property; and (3) to restrain the enforcement of or compliance with any
legislation or other governmental enactment, rule, or order that may be unconstitutional
or otherwise invalid, if the enforcement of or compliance with such enactment, rule, or
order might impair the security under this Mortgage or be prejudicial to Mortgagee's
interest.
E. Any real estate sold pursuant to any writ of execution issued on a
judgment obtained by virtue of the Note or this Mortgage , or pursuant to any other
judicial proceedings under this Mortgage or the Note, may be sold in one parcel, as an
entirety, or in such parcels, and in such manner or order as Mortgagee, in its sole
discretion, may elect. Upon any such foreclosure sale, Mortgagee may bid for and
purchase the Mortgaged Property and, upon compliance with the terms of sale, may hold,
retain and possess, and dispose of such property in its own absolute right without further
accountability. Mortgagee is authorized, at its option, to conduct any such foreclosure
sale subject to the rights of any tenants of the Mortgaged Property, and the failure to
make any such tenants parties defendant to any such foreclosure proceedings and to
foreclose their rights will not be, nor be asserted by Mortgagor to be, a defense to any
proceedings instituted by Mortgagee to collect the sums secured by this Mortgage .
19. Rights and Remedies Cumulative
A. The rights and remedies of Mortgagee as provided in this Mortgage or in
the Note shall be cumulative and concurrent, may be pursued separately, successively, or
together against Mortgagor or against the Mortgaged Property, or both, at the sole
discretion of Mortgagee, and may be exercised as often as the occasion shall arise. The
failure to exercise any such right or remedy shall in no event be construed as a waiver or
release of the same.
B. Any failure by Mortgagee to insist upon strict performance by Mortgagor
of any of the terms and provisions of this Mortgage or the Note shall not be deemed to be
a waiver of any of the terms or provisions of the Mortgage or Note, and Mortgagee shall
have the right subsequently to insist upon strict performance by Mortgagor of any and all
of them.
C. Neither Mortgagor nor any other person now or later obligated for
payment of all or any part of the sums now or later secured by this Mortgage shall be
relieved of such obligation by reason of the failure of Mortgagee to comply with any
request of Mortgagor or of any other person so obligated to take action to foreclose on
this Mortgage or otherwise enforce any provisions of the Mortgage or the Note, or by
reason of the release, regardless of consideration, of all or any part of the security held for
the indebtedness secured by this Mortgage , or by reason of any agreement or stipulation
between any subsequent owner of the Mortgaged Property and Mortgagee extending the
time of payment or modifying the terms of the Mortgage or Note without first having
obtained the consent of Mortgagor or such other person, and in the latter event
Mortgagor and all such other persons shall continue to be liable to make payments
according to the terms of any such extension or modification agreement, unless expressly
released and discharged in writing by Mortgagee.
D. Mortgagee may release, regardless of consideration, any part of the
security held for the indebtedness secured by this Mortgage without, as to the remainder
of the security, in any way impairing or affecting the lien of this Mortgage or its priority
over any subordinate lien.
E. For payment of the indebtedness secured by this Mortgage Mortgagee
may resort to any other security for the indebtedness held by Mortgagee in such order
and manner as Mortgagee may elect.
20. Mortgagor’s Waivers
Mortgagor waives and releases:
A. All benefits that might accrue to Mortgagor by virtue of any present or
future law exempting the Mortgaged Property, or any part of the proceeds arising from
any sale of the Mortgaged Property, from attachment, levy, or sale on execution, or
providing for any stay of execution, appraisement, redemption, exemption from civil
process or extension of time for payment;
B. Unless specifically required in this Mortgage , all notices of Mortgagor's
default or of Mortgagee's election to exercise, or Mortgagee's actual exercise of, any
option or remedy under the note or this Mortgage ; and
C. Any and all right to have the assets comprising the Mortgaged Property
marshaled upon any foreclosure sale.
21. Counsel Fees
If Mortgagee becomes a party to any suit or proceeding affecting the Mortgaged
Property or title to the property, the lien created by this Mortgage or Mortgagee's interest
in the same, or if Mortgagee engages counsel to collect any of the indebtedness or to
enforce performance of the agreements, conditions, covenants, provisions, or stipulations
of this Mortgage or the note, then Mortgagee's costs, expenses, and reasonable counsel
fees (including, but not limited to, counsel fees incurred in appellate proceedings),
whether or not suit is instituted, shall be paid to Mortgagee by Mortgagor, on demand,
with interest at the default rate (as that term is defined in the short term note), and until
paid they shall be deemed to be part of the indebtedness evidenced by the Note and
secured by this Mortgage .
22. No Obligation to Subordinate
Mortgagor acknowledges and agrees that Mortgagee has absolutely no obligation
to subordinate the lien of this Mortgage to the lien or liens of any other Mortgages or
encumbrances that Mortgagor or any other person or entity may desire to place or record
against the Mortgaged Property or any portion of the property.
23. Unconditional Nature of Mortgagor’s Obligations
Mortgagor acknowledges and agrees that its obligations pursuant to this
Mortgage , as well as Mortgagor's obligations as maker pursuant to the Note, are, except
to the extent expressly provided in this Mortgage or the Note, absolute and unconditional,
and not subject to any implied or constructive conditions precedent or conditions
subsequent.
24. Communications
All communications required under or in connection with this Mortgage or the
Note shall be in writing, and shall be sent by registered or certified mail, postage prepaid,
addressed to Mortgagor at __________________________________________________
________________________________________________________________________
(street address, city, county, state, zip code) , and in the case of Mortgagee addressed to
________________________________________________________________________
________________________________________________________________________
(street address, city, county, state, zip code) , or to such other address as either party may
designate from time to time by notice to the other in the manner set forth in this Section,
and shall be deemed effective three days following the date of such mailing.
25. Amendment; Consents
Mortgagor and Mortgagee acknowledge and agree that there are no oral
agreements between them respecting or relating to this Mortgage or the Note or the
Mortgaged Property, and that neither this Mortgage nor any term of it shall be changed,
amended, waived, or terminated except by agreement in writing signed by the party
against whom enforcement of the change, amendment, waiver, or termination is sought.
Whether or not specifically provided in this Mortgage , all consents or approvals given
pursuant to or in connection with this Mortgage or the Note shall not be binding or
effective unless they are written and duly executed by the party giving the consent or
approval.
26. Applicable Law
This Mortgage shall be governed by and construed according to the laws of the
state of the situs of the Mortgaged Property.
27. Construction
Whenever used in this Mortgage , unless the context clearly indicates a contrary
intent:
A. The word Mortgagor shall mean the person who executes this Mortgage
and any subsequent owner of the Mortgaged Property or any portion of the
property and his/her respective heirs, executors, administrators, successors and
assigns;
B. The word Mortgagee shall mean the persons specifically named in this
Mortgage as Mortgagee or any subsequent holder of this Mortgage ;
C. The word person shall mean individual, corporation, limited liability
company, partnership, or unincorporated association;
D. The use of any gender shall include all genders;
E. The singular number shall include the plural and the plural the singular as
the context may require; and
F. If Mortgagor is more than one person, all agreements, conditions,
covenants, provisions, stipulations, warrants of attorney, authorizations, waivers,
releases, options, undertakings, rights, and benefits made or given by Mortgagor
shall be joint and several, and shall bind and affect all persons who are defined as
Mortgagor as fully as though all of them were specifically named in this
Mortgage wherever the word Mortgagor is used.
28. Captions
The captions preceding the text of the paragraphs or sections of this Mortgage are
inserted only for convenience of reference and shall not constitute a part of this
Mortgage ; nor shall they in any way affect its meaning, construction, or effect.
29. Purchase Money Wraparound Mortgage
Mortgagor and Mortgagee acknowledge and agree that this wraparound mortgage
is a purchase money wraparound mortgage .
30. Further Assurances
Mortgagor shall execute and deliver such further instruments and perform such
further acts as may be reasonably requested by Mortgagee from time to time to confirm
the provisions of this M ortgage or the Note, to carry out more effectively the purposes of
this Mortgage or the other documents securing the Note, or to confirm the priority of the
lien created by this Mortgage on any property, rights, or interest encumbered or intended
to be encumbered by the lien of this Mortgage or the other documents securing the Note.
31. Grace Period
Notwithstanding anything in this Mortgage to the contrary, Mortgagee shall not
exercise any right or remedy provided for in this Mortgage or in the Note because of any
default of Mortgagor, unless: (a) if the default consists of the failure to pay money,
mortgagee shall have given written notice of the default to Mortgagor and Mortgagor
shall have failed to pay the sum or sums due within a period of (e.g.,10) ______ days
after the date of such notice; or (b) if the default consists of something other than the
nonpayment of money, Mortgagee shall have given written notice of the default to
Mortgagor, and Mortgagor shall have failed, within (e.g., 30) _______ days after the
effective date of such notice to cure the default, except that if the default is such that it is
not susceptible of being cured with due diligence within the (e.g., 30) _______ days,
Mortgagor shall have up to (e.g., 60) _______ days from the effective date of such notice
to cure the default if Mortgagor shall have begun to cure the default within the (e.g., 30)
_______ days and shall actively and diligently in good faith proceed with the correction
of the default until it shall be fully corrected; provided, however, that no such notice from
Mortgagee shall be required nor shall Mortgagee be required to allow any part of the
grace period: (1) if a petition in bankruptcy or for reorganization shall have been filed by
Mortgagor, or if a receiver or a trustee is appointed for Mortgagor, or if Mortgagor
makes an assignment for the benefit of creditors, or if Mortgagor is levied upon and is
about to be sold out upon the Mortgaged Property; (2) if a petition in bankruptcy or for
reorganization shall have been filed against Mortgagor and shall not be dismissed for
(e.g., 30) days after such filing; or (3) for Mortgagee to be entitled to exercise its rights
pursuant to Section 15 of this Mortgage .
32. Limited Liability of Mortgagor
Mortgagor's liability under this Mortgage or under the Note secured by this
Mortgage shall be enforceable only out of or against: (1) the property encumbered by this
Mortgage and security agreement; (2) any guaranty or surety agreement given as security
for the Note, whether now or later given; and (3) any other property or collateral now or
later mortgaged, pledged, or assigned in writing by Mortgagor to Mortgagee . The lien of
any judgment against Mortgagor in any proceeding instituted on, under, or in connection
with the Note or this Mortgage , or both, shall not extend to any property now or later
owned by Mortgagor which is not mortgaged, pledged, or assigned as security for the
Note.
33. Prepayment
This Mortgage cannot be prepaid without Mortgagee's consent.
34. Conflicts with Senior Mortgage
Any conflicts between the provisions of this Mortgage and the senior obligation
shall be resolved in favor of the senior obligation including, but not limited to, any
conflicts between the foregoing condemnation and insurance provisions, but in no event
shall any conflict impair the payments due under the Note secured by this Mortgage or
affect the ability to satisfy the Note in full.
35. Severability
The invalidity or unenforceability of any term or provision of this Agreement, or
the nonapplication of such term or provision to any person or circumstances, shall not
impair or affect the remainder of this Agreement of its application to other persons and
circumstances, and the remaining terms and provisions of this Mortgage shall not be
invalidated, but shall remain in full force and effect.
36. Income Expense Statement
An income and expense statement for the Mortgaged Property shall be furnished
to Mortgagee upon request, but in no event more than once a year.
37. Mortgagor Warranties
Mortgagor warrants and agrees that:
A. Mortgagor has full power and authority to enter into this Mortgage ;
B. Mortgagor shall use the mortgaged property as a (specify purpose)
__________________________________________________________________
for so long as this Mortgage is in full force and effect; and
C. Mortgagor shall defend the Mortgaged Property against all lawful claims.
Mortgagor has executed this Mortgage the day and year first above written.
____________________________________
(P rinted name)
____________________________________
(Signature of Mortgagor)
(Acknowledgments are optional and form may vary by state)
Attach Exhibits
STATE OF ______________________
COUNTY OF _______________________
Personally appeared before me, the undersigned authority in and for the said
county and state, on this _____ day of _______________________, 20_____, within my
jurisdiction, the within named, ________________________________________ (Name
of Mortgagor), who acknowledged that he executed the above and fore going instrument.
______________________________
NOTARY PUBLIC
My Commission expires:
______________________
