<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report
Filed pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) July 19, 1996
BRANDYWINE REALTY TRUST
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
MARYLAND 1-9106 23-2413352
(State or Other Jurisdiction (Commission (I.R.S. Employer
of Incorporation) file number) Identification Number)
Two Greentree Centre, Suite 100, Marlton, New Jersey 08053
(Address of principal executive offices)
(609) 797-0200
(Registrant's telephone number, including area code)
<PAGE>
Item 2. Acquisition or Disposition of Assets.
On July 19, 1996, the Trust acquired a seven-story, 122,000
square foot office building in Cherry Hill, New Jersey (the "LibertyView
Building") from UM Real Estate Investment Company, LLC ("UM") for a cash price
of $10.6 million, of which $9.6 million was paid at the closing. The balance is
payable to UM, in installments, as outlined below:
Due Date Amount
-------- ------
July 31, 1997 $100,000
August 31, 1997 $100,000
September 31, 1997 $100,000
October 31, 1997 $100,000
November 31, 1997 $100,000
December 31, 1997 $500,000
The amount of the purchase price was determined through arm's-length
negotiation between the Trust and UM.
The LibertyView Building was completed in 1990 and, as of May
30, 1996, the occupancy level was approximately 66%. A single tenant, HIP Health
Plan of NJ, an HMO provider, occupies 37,515 square feet under a lease expiring
January 2007. No other tenant occupies more than 10% of the building. Rentals of
another tenant, Shapiro and Kreisman, a law firm, comprise approximately 15.4%
of the total current base rents for the property. Other tenants in the
LibertyView Building include a regional bank, big six accounting firm and
several Philadelphia-based law firms.
The Trust financed its acquisition of the LibertyView Building
through a combination of term financing ($9,777,140), from a commercial bank
(Summit Bank, formerly known as United Jersey Bank), and proceeds from a recent
investment in the Trust by an affiliate of Richard M. Osborne, one of the
Trustees of the Trust. The acquisition portion of the bank loan ($8,480,000)
bears interest at a fixed rate of 8% per annum and matures on January 1, 1999.
The bank loan provides for additional funding of an amount not to exceed $1.3
million, which will be advanced for tenant finishing and leasing commissions on
currently vacant space. The additional funding will be repayable at prime plus
1% and will mature on January 1, 1999.
The bank loan will be secured by a first mortgage on the
LibertyView Building, and will generally be non-recourse to the Trust, except
that the Trust will be required to guarantee completion of the tenant
improvements for any new leases, and up to $3 million of principal of the bank
loan plus the amount of principal and interest unpaid as of the date of
acceleration of the bank loan in the event of a default thereunder. The bank has
reserved the right to approve of any material change in the ownership of
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<PAGE>
the Trust, including a change resulting from the contemplated transaction (the
"SSI/TNC Transaction") among the Trust, Safeguard Scientifics, Inc. and The
Nichols Company, and in the event the Bank does not approve of any such
ownership change, the loan, at the bank's option, will become repayable without
penalty upon 120 days notice. If the bank were to withhold approval of the
SSI/TNC Transaction and require repayment of its loan, the Trust would be
required to seek replacement financing and there can be no assurance that the
Trust could obtain such replacement financing or that any such replacement
financing would be on terms acceptable to the Trust. If the Trust were unable to
refinance the loan, the LibertyView Building could be transferred to the bank
with a consequent loss of income and asset value to the Trust.
The following table sets forth scheduled lease expirations for
leases in place at the LibertyView Building as of June, 1996 for each of the
years beginning with January 1, 1996, assuming no tenant exercises renewal
options or is terminated due to default:
<TABLE>
<CAPTION>
====================================================================================================================
Rentable
Number of Square Annual
Leases Footage Percentage of Minimum Rent Average Per
Expiring Subject to Occupied Under Square Footage Percentage of
Within the Expiring Rentable Expiring Rent Expiring Total Rent Under
Year Leases Square Footage Leases Leases Expiring Leases
- --------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <C> <C> <C> <C>
1996 1 2,998 3.70% $ 53,964 $ 18.00 4.51%
- --------------------------------------------------------------------------------------------------------------------
1997 1 11,521 14.23% 184,662 16.03 15.42%
- --------------------------------------------------------------------------------------------------------------------
1998 0 0 0.00% -- -- 0.00%
- --------------------------------------------------------------------------------------------------------------------
1999 1 7,233 8.93% 105,840 14.63 8.84%
- --------------------------------------------------------------------------------------------------------------------
2000 2 5,798 7.16% 99,196 17.11 8.28%
- --------------------------------------------------------------------------------------------------------------------
2001 2 6,978 8.62% 126,734 18.16 10.58%
- --------------------------------------------------------------------------------------------------------------------
2002 1 8,912 11.01% 164,872 18.50 13.77%
- --------------------------------------------------------------------------------------------------------------------
2003 0 0 0.00% -- -- 0.00%
- --------------------------------------------------------------------------------------------------------------------
2004 0 0 0.00% -- -- 0.00%
- --------------------------------------------------------------------------------------------------------------------
2005 0 0 0.00% -- -- 0.00%
- --------------------------------------------------------------------------------------------------------------------
2006 and 1 37,515 46.34% 462,185 12.32 38.60%
thereafter
- --------------------------------------------------------------------------------------------------------------------
TOTAL 9 80,955 100.00% $ 1,197,453 $ 14.79 100.00%
====================================================================================================================
</TABLE>
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<PAGE>
Item 7. Financial Statement, Pro Forma Financial Information and Exhibits.
(a) Financial Statements of Businesses Acquired.
Index
- -----
Brandywine Realty Trust
Libertyview Building
Report Of Independent Public Accountants
Statements Of Revenue and Certain Expenses for the Year Ended
December 31, 1995 and the Three Month Period Ended March 31, 1996
Notes to Financial Statements
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<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To Brandywine Realty Trust:
We have audited the statement of revenue and certain expenses of the LibertyView
Building described in Note 1 for the year ended December 31, 1995. This
financial statement is the responsibility of the LibertyView Building's
management. Our responsibility is to express an opinion on this financial
statement based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and the significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
The accompanying statement of revenue and certain expenses was prepared for the
purpose of complying with the rules and regulations of the Securities and
Exchange Commission and is not intended to be a complete presentation of the
LibertyView Building's revenue and expenses.
In our opinion, the financial statement referred to above presents fairly, in
all material respects, the revenue and certain expenses of the LibertyView
Building for the year ended December 31, 1995, in conformity with generally
accepted accounting principles.
ARTHUR ANDERSEN LLP
Philadelphia, Pa.,
June 14, 1996
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<PAGE>
LIBERTYVIEW BUILDING
STATEMENTS OF REVENUE AND CERTAIN EXPENSES
(Notes 1 and 2)
For the
For the Three-Month
Year Ended Period Ended
December 31, March 31,
1995 1996
------------ ------------
(unaudited)
REVENUE:
Base rents (Note 2) $1,119,000 $300,000
Tenant reimbursements 535,000 122,000
---------- --------
Total revenue 1,654,000 422,000
---------- --------
CERTAIN EXPENSES:
Maintenance 277,000 71,000
Utilities 215,000 59,000
Real estate taxes 274,000 74,000
Other operating expenses 32,000 8,000
---------- --------
Total certain expenses 798,000 212,000
---------- --------
REVENUE IN EXCESS OF CERTAIN EXPENSES $ 856,000 $210,000
========== ========
The accompanying notes are an integral part of these statements.
-6-
<PAGE>
LIBERTYVIEW BUILDING
NOTES TO STATEMENTS OF REVENUE AND CERTAIN EXPENSES
DECEMBER 31, 1995
1. BASIS OF PRESENTATION:
The statements of revenue and certain expenses reflect the operations of the
LibertyView Office Building (the "LibertyView Building") located in New Jersey,
which will be acquired by Brandywine Realty Trust (the "Trust") from an
unaffiliated party by July 19, 1996. The LibertyView Building has an aggregate
net leasable area of approximately 121,700 square feet and is 63% leased as of
December 31, 1995.
The books of the LibertyView Building are maintained on a modified cash basis.
Adjusting entries have been made to present the accompanying financial
statements in accordance with generally accepted accounting principles. The
accompanying financial statements exclude certain expenses--such as interest,
depreciation and amortization, professional fees, and other costs not directly
related to the future operations of the LibertyView Building that may not be
comparable to the expenses expected to be incurred by the Trust.
2. OPERATING LEASES:
Base rents presented for the year ended December 31, 1995 and the three month
period ended March 31, 1996, include straight-line adjustments for rental
revenue increases in accordance with generally accepted accounting principles.
The aggregate rental revenue increase resulting from the straight-line
adjustments for the year ended December 31, 1995, and the three month period
ended March 31, 1996, was $127,000 and $12,000, respectively.
Tenants whose minimum rental payments equaled 10% or more of the total base
rents in 1995 were:
HIP Health Plan of NJ $462,000
Shapiro and Kreisman $185,000
In September 1995, LibertyView Building entered into a 60-month lease agreement
with Sleepcare, a related party to the seller, of which $18,000 and $14,000 of
base rents for the
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<PAGE>
year ended December 31, 1995 and the three-month period ended March 31, 1996,
respectively, is included in the statements of revenue and certain expenses.
The LibertyView Building is leased to tenants under operating leases with
expiration dates extending to the year 2007. Future minimum rentals under
noncancelable operating leases, excluding tenant reimbursements of operating
expenses as of December 31, 1995, are as follows:
1996 $1,205,000
1997 1,177,000
1998 1,118,000
1999 1,118,000
2000 950,000
Thereafter 4,440,000
Certain leases also include provisions requiring tenants to reimburse management
costs and other overhead up to stipulated amounts.
-8-
<PAGE>
(b) Pro Forma Financial Information.
BRANDYWINE REALTY TRUST
PRO FORMA CONDENSED CONSOLIDATING FINANCIAL INFORMATION
(Unaudited)
The following sets forth the pro forma condensed consolidating
balance sheet of Brandywine Realty Trust as of March 31, 1996 and the pro forma
condensed consolidating statements of operations for the year ended December 31,
1995, and the three-month period ended March 31, 1996.
The pro forma condensed consolidating financial information is
presented as if the consummated transactions of (a) the June 21, 1996 investment
by the Turkey Vulture Fund XIII, Ltd. (the "RMO Fund") of $1,330,000 in debt and
equity securities of the Trust; and (b) the July 19, 1996 acquisition of the
LibertyView Office Building (the "LibertyView Building") by the Trust had been
consummated on March 31, 1996, for balance sheet purposes and January 1, 1995
for purposes of the statements of operations. This unaudited pro forma condensed
consolidating financial information should be read in conjunction with the
historical financial statements of the Trust and LibertyView and the related
notes thereto. In management's opinion, all adjustments necessary to reflect the
effects of the consummated transactions have been made.
The pro forma condensed consolidating financial information is
unaudited and is not necessarily indicative of what the actual financial
position would have been at March 31, 1996, nor does it purport to represent the
future financial position and the results of operations of the Trust.
-9-
<PAGE>
BRANDYWINE REALTY TRUST
PRO FORMA CONDENSED CONSOLIDATING BALANCE SHEET
AS OF MARCH 31, 1996 (Notes 1 and 2)
(Unaudited)
(in thousands)
<TABLE>
<CAPTION>
Brandywine
Realty Trust
Historical Pro Forma
Consolidated Adjustments Pro Forma
(A) (B) (C) Consolidated
------------ ----------- -------------
Assets:
<S> <C> <C> <C>
Real estate investments, net $13,770 $10,600 (B) $24,370
Cash and cash equivalents 701 (90) (B)(C) 611
Escrowed cash 760 -- 760
Deferred costs, net 1,336 -- 1,336
Other assets 390 300 (B) 690
------- ------- -------
Total assets $16,957 $10,810 $27,767
======= ======= =======
Liabilities:
Mortgages and notes payable $8,905 $10,472 (B)(C) $19,377
Other liabilities 698 -- 698
------- ------- -------
Total liabilities 9,603 10,472 20,075
------- ------- -------
Minority Interest -- -- --
Shareholders' Equity:
Common shares of beneficial interest 19 1 (C) 20
Additional paid-in capital 16,772 295 (C) 17,067
Stock warrants -- 42 (C) 42
Accumulated equity (deficit) (9,437) -- (9,437)
------- ------- -------
Total shareholders' equity 7,354 338 7,692
------- ------- -------
Total liabilities and shareholders'
equity $16,957 $10,810 $27,767
======= ======= =======
</TABLE>
The accompanying notes and management assumptions are an integral
part of these statements.
-10-
<PAGE>
BRANDYWINE REALTY TRUST
PRO FORMA CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1995 (Notes 1 and 3)
(Unaudited)
(in thousand, except Share and per Share amounts)
<TABLE>
<CAPTION>
Brandywine Liberty
Realty Trust View
Historical Building
Consolidated Historical Pro Forma Pro Forma
(A) (B) Adjustments Consolidated
------------ ---------- --------- ------------
<S> <C> <C> <C> <C>
Revenue:
Base rents $3,517 $1,119 $ -- $4,636
Tenant reimbursements 66 535 -- 601
Other 83 -- -- 83
------ ------ ------- ------
Total revenue 3,666 1,654 -- 5,320
------ ------ ------- ------
Operating expenses:
Interest 793 -- 762 (D)(F) 1,555
Depreciation and amortization 1,402 -- 459 (C)(E) 1,861
Other expenses 2,290 798 -- 3,088
------ ------ ------- ------
Total operating expenses 4,485 798 1,221 6,504
------ ------ ------- ------
Income (loss) before
minority interest (819) 856 (1,221) (1,184)
Minority interest in
income (loss) 5 -- -- 5
------ ------ ------- ------
Income (loss) before
extraordinary items $ (824) $ 856 $(1,221) $(1,184)
====== ====== ======== ========
Earnings per share of
beneficial interest $(0.44) $ (0.61)
======= =======
Weighted average
number of shares
outstanding including
share equivalents 1,874,372 1,934,372
========= =========
</TABLE>
The accompanying notes and management assumptions are an
integral part of these statements.
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<PAGE>
BRANDYWINE REALTY TRUST
PRO FORMA CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS
FOR THE THREE-MONTH PERIOD ENDED MARCH 31, 1996 (Notes 1 and 3)
(Unaudited)
(in thousand, except Share and per Share amounts)
<TABLE>
<CAPTION>
Brandywine Liberty
Realty Trust View
Historical Building
Consolidated Historical Pro Forma Pro Forma
(A) (B) Adjustments Consolidated
------------ ---------- ----------- ------------
<S> <C> <C> <C> <C>
Revenue:
Base rents $ 972 $ 300 $ -- $ 1,272
Tenant reimbursements 35 122 -- 157
Other 38 -- -- 38
------- ------- ------ -------
Total revenue 1,045 422 -- 1,467
------- ------- ------ -------
Operating expenses:
Interest 207 -- 191 (D)(F) 398
Depreciation and 242 -- 115 (C)(E) 357
amortization
Other expenses 584 212 -- 796
------- ------- ------ -------
Total operating
expenses 1,033 212 306 1,551
------- ------- ------ -------
Income (loss) before 12 210 (306) (84)
minority interest
Minority interest in
income (loss) 2 -- -- 2
------- ------- ------ -------
Income (loss) before
extraordinary items $ 10 $ 210 $ (306) $ (86)
======= ======= ====== =======
Earnings per share of
beneficial interest $ 0.01 $ (0.04)
======= =======
Weighted average
number of shares
outstanding including
share equivalents 1,876,944 1,936,944
========= =========
</TABLE>
The accompanying notes and management assumptions are an integral
part of these statements.
-12-
<PAGE>
BRANDYWINE REALTY TRUST
NOTES AND MANAGEMENT'S ASSUMPTIONS TO
UNAUDITED PRO FORMA CONDENSED CONSOLIDATING
FINANCIAL INFORMATION
(in thousands, except share and per share amounts)
1. BASIS OF PRESENTATION:
Brandywine Realty Trust (the "Trust") is a Maryland real estate
investment trust. The Trust owns 4 properties as of March 31, 1996 and on July
19, 1996 acquired the LibertyView Office Building (the "LibertyView Building")
from an unrelated party. The LibertyView Building has an aggregate net leasable
area of approximately 122,000 square feet and is 63% leased as of December 31,
1995 and 66% leased as of March 31, 1996.
These pro forma financial statements should be read in conjunction
with the historical financial statements and notes thereto of the Trust, as
previously filed, and the LibertyView Building as included elsewhere herein. In
management's opinion, all adjustments necessary to reflect the effects of the
acquisition of the LibertyView Building by the Trust have been made.
2. ADJUSTMENTS TO PRO FORMA CONDENSED CONSOLIDATING BALANCE SHEET:
(A) Reflects the historical consolidated balance sheet of the Trust as of
March 31, 1996.
(B) Reflects the Trust's acquisition of the LibertyView Building as of
March 31, 1996, based upon the purchase price of $10,600,000
acquired with cash of $1,420,000, a mortgage note payable of
$8,480,000 due in January 1999 with interest payable monthly at 8%
and a note payable to the seller of $1,000,000 due in installments
through December 1997 with no interest payable. Deferred financing
costs of $300,000 related to the mortgage note payable have been
capitalized.
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<PAGE>
(C) Reflects the investment in the Trust by the RMO Fund funded by a
note bearing interest at prime and 60,000 Common Shares plus one
warrant for 60,000 Common Shares at a price of $.70 per share. The
warrant is exercisable at $6.50 per share. The loan matures in
1999.
Dr. Cash and cash equivalents $1,330,000
Cr. Mortgage and notes payable $992,000
Cr. Common shares of beneficial interest 1,000
Cr. Additional paid-in capital 295,000
Cr. Stock warrants 42,000
3. ADJUSTMENTS TO PRO-FORMA CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS:
(A) Reflects the historical consolidated operations of the Trust.
(B) Reflects the historical operations of the LibertyView
Building, excluding certain expenses such as interest,
depreciation and amortization, professional costs, and other
costs not directly related to the future operations of the
LibertyView Building.
(C) Reflects depreciation totaling $339,000 and $85,000,
respectively, of the LibertyView Building using a 25-year
depreciable life for the year ended December 31, 1995, and the
three-month period ended March 31, 1996.
(D) Reflects the increase in interest expense of $678,000 and
$170,000, respectively, related to the mortgage note payable
of the LibertyView Building, which has an interest rate of 8%
per annum for the year ended December 31, 1995 and for the
three-month period ended March 31, 1996.
(E) Reflects the amortization of deferred financing costs related
to the LibertyView Building of $120,000 and $30,000,
respectively, for the year ended December 31, 1995 and the
three-month period ended March 31, 1996.
(F) Reflects the increase in interest expense of $84,000 related
to the note payable to the RMO Fund (which bears interest at
prime), assuming a prime rate of 8.25% for the year ended
December 31, 1995. For the three-month period ended March 31,
1996, the increase in interest expense was $21,000.
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<PAGE>
(c) Exhibits.
Exhibit Index
99.1 Purchase and Sale Agreement between UM Real Estate Investment
Company, LLC ("UM") and the Trust.
99.2 First Amendment to Purchase and Sale Agreement between UM and
the Trust.
99.3 Second Amendment to Purchase and Sale Agreement between UM and
the Trust.
99.4 Third Amendment to Purchase and Sale Agreement between UM and
the Trust.
99.5 Promissory Note in the principal amount of $1,000,000 from the
Trust to UM.
99.6 Subordinated Mortgage from the Trust to UM.
99.7 Amended and Restated Loan Agreement between the Trust and
Summit Bank ("SB").
99.8 Amended and Restated Promissory Note from the Trust to SB.
99.9 Amended and Restated Mortgage from the Trust to SB.
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<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
BRANDYWINE REALTY TRUST
Date: August 1, 1996 By: /s/ Gerard H. Sweeney
---------------------
Title: President and Chief
Executive Officer
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<PAGE>
Exhibit 99.1 Purchase and Sale Agreement
between UM Real Estate
Investment Company, LLC
("UM") and the Trust
PURCHASE AND SALE AGREEMENT
THIS PURCHASE AND SALE AGREEMENT (the "Agreement") is made as of the
28th day of March, 1996, by and between UM REAL ESTATE INVESTMENT COMPANY, LLC,
a New Jersey limited liability company, with an office at 56 Haddon Avenue,
Haddonfield, New Jersey 08033 ("Seller") and BRANDYWINE REALTY TRUST, a Maryland
real estate investment trust, with offices at Two Greentree Center, Suite 100,
Marlton, New Jersey 08053 ("Buyer").
W I T N E S S E T H:
WHEREAS, Seller is the owner of those certain tracts or parcels of
ground located at the intersection of Haddonfield Road and Chapel Avenue, Cherry
Hill, Camden County, New Jersey, shown on the official tax map of the Township
of Cherry Hill as Block 176.01, Lots 1, 2 and 3 (such lots to include the
parking lot adjacent to Third Avenue), and which are more particularly described
on Exhibit "A" attached hereto (the "Land"), together with the approximately
121,737 square foot office building on Lot 1 commonly known as "LibertyView", as
well as all other improvements ("Improvements") and personal property of Seller
located thereon and used in connection with the operation of such building,
together with those certain other assets, properties, businesses, rights,
licenses, privileges, benefits, profits, accounts and claims hereinafter more
specifically described, all of which taken together hereinafter sometimes
collectively referred to as the "Assets"; and
WHEREAS, Seller desires to transfer and convey to Buyer the Assets, and
Buyer desires to purchase the Assets from Seller upon the terms and conditions
hereinafter provided.
NOW, THEREFORE, Buyer and Seller, for and in consideration of the sums
hereinafter set forth, receipt of which is hereby acknowledged by Seller, as
well as the mutual promises and covenants herein contained, intending to be
legally bound, do hereby agree as follows:
Article 1
SALE OF PROPERTY
1.1 Subject to all the terms and conditions of this Agreement, Seller
agrees to transfer and convey the Assets to Buyer and Buyer agrees to purchase
the Assets, free and clear of all liens, encumbrances and liabilities with the
exception of the Permitted Exceptions (as hereafter defined), comprised of all
of the following:
a. The Land and the improvements now or hereafter located or
constructed thereon, and all easements, tenements, hereditaments, rights,
licenses, privileges and appurtenances, whether or not of record, in any way
belonging or relating thereto and all mineral, oil and gas on and under the and
all development, air and water rights belonging or relating to the same
(collectively the "Property");
b. All fixtures, machinery, vehicles, tools, signs, systems,
equipment, furnishings and furniture; tangible and intangible personal property;
and replacements, inventories and supplies; all as same now are or hereafter may
be located in, on or about the Property, or used in conjunction therewith
(collectively the "Personal Property"), including, without limitation, all of
the following: all furniture, furnishings and carpeting; all heating, lighting,
plumbing, water, sewer, ventilating, exhaust, electrical, gas, refrigeration,
air-conditioning, communication, fire protection, security, disability and
life/safety fixtures, equipment and systems; all hot water heaters, furnaces,
heating controls, motors and boiler pressure systems and equipment; all
incinerating, disposal, cleaning, maintenance, janitorial, snow removal and
landscaping equipment; all fuels; all appliances; all office equipment,
furniture, furnishings and supplies; and all items of specific personal
property, if any; excluding from the foregoing only such items of furniture and
furnishings as are owned by tenants renting and occupying space in the Property
("Occupancy Tenants") under leases ("Tenant Leases") and pursuant to which
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<PAGE>
the Occupancy Tenants have the right to remove the same from the Property and
excluding those items described on Exhibit "B" attached hereto;
c. All right, title and interest in and to any streets, roads,
alleys or other public ways adjoining the Land, including, without limitation,
any land lying in the bed of any street, road, alley or other public way, open
or proposed, and any strips and rights-of-way adjoining the Land (including,
without limitation, all riparian and other rights in and to submerged lands);
d. All certificates, permits, licenses, franchises,
authorizations and approvals relating to the Property and/or the Personal
Property or the ownership, use, access, occupancy, repair, maintenance or
operation thereof or any part thereof, running to or in favor of Seller or the
Property and/or the Personal Property, and which Buyer hereafter elects to
accept;
e. All Operating Agreements (hereinafter defined) running to or
in favor of Seller or the Property and/or the Personal Property, and which Buyer
hereafter elects to accept;
f. All right, title and interest of Seller as landlord or
otherwise in and to all Tenant Leases, together with all collateral therefor,
all guarantees by third parties of the agreements and obligations thereunder of
Occupancy Tenants, and all rentals, security deposits advance rentals,
receivables, reimbursements items payable by Occupancy Tenants and all claims
against Occupancy Tenants; and
g. All right, title and interest of Seller of every kind and
description in and to the following: All drawings, plans and specifications
covering the Assets or any part thereof; all rights to the name "LibertyView"
and all trademarks, trade names, service marks, registrations, logos,
applications, good will and other rights (including the right to sue for past
and present infringements thereof) associated therewith; the security system;
all telephone numbers; all tenant files; all operating and maintenance files;
and all maintenance and operating manuals;
In no event shall Seller or Buyer be obligated or entitled hereunder to sell and
convey, or purchase and acquire, respectively, less than all of the Property.
Article 2
PURCHASE PRICE
2.1 Buyer will pay the purchase price (the "Purchase Price") of Ten
Million Six Hundred Thousand Dollars ($10,600,000) as follows:
(a) Fifty Thousand Dollars ($50,000) good faith deposit to be
paid on the date hereof, and, provided Buyer has not terminated this Agreement
pursuant to the terms hereof, an additional Fifty Thousand Dollars ($50,000)
good faith deposit to be paid on or before the date which is one (1) business
day after expiration of the Due Diligence Period (collectively, and together
with all interest earned thereon, the "Deposit") to be held by the Title Company
(as hereinafter defined) to be invested and held in escrow by the Title Company
in an interest bearing account which, if available, shall be a bank money market
account insured by F.D.I.C. All interest earned thereon shall be reported as
income of Buyer. In the event this Agreement is terminated for any reason (other
than due to the default or failure of Buyer to perform hereunder) prior to the
expiration of the Due Diligence Period, the Deposit shall be immediately
returned to Buyer, the parties acknowledging and agreeing that from and after
the expiration of the Due Diligence Period the Deposit is non-refundable. At
Closing, if any, the Deposit shall be paid to Seller as a credit towards the
Purchase Price.
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<PAGE>
(b) One Million Dollars ($1,000,000) by the execution and
delivery to Seller of Buyer's note (the "Note"), which Note shall be secured by
a second purchase money mortgage and security agreement (the "Mortgage"), which
Mortgage shall be subject and subordinate solely to a first purchase money
mortgage recorded at Closing, an assignment of rents and leases (the "Lease
Assignment"), UCC-l financing statements (the "Financing Statements"), and such
other customary documents required thereunder, in form and containing terms and
provisions satisfactory to Seller in its reasonable discretion (collectively,
the "Loan Documents"). The term of the Note shall commence at Closing and
continue to December 31, 1997. Payments shall be made, without interest, as
follows:
July 31, 1997 $100,000
August 31, 1997 $100,000
September 30, 1997 $100,000
October 31, 1997 $100,000
November 30, 1997 $100,000
December 31, 1997 $500,000
(c) Nine Million Five Hundred Thousand Dollars ($9,500,000) to
be paid at Closing by federal funds wire transfer, cash, certified check or
title company check (subject to adjustments at Closing).
Article 3
BUYER'S DUE DILIGENCE PERIOD
3.1 Buyer shall have until 5:00 p.m. E.D.S.T. on May 30, 1996 (the "Due
Diligence Period") to satisfy itself as to all matters respecting the Property.
Buyer may, at any time on or prior to the expiration of the Due Diligence
Period, for any reason or no reason, terminate this Agreement by notice to
Seller following which (provided Buyer is not then in default hereunder) the
Title Company shall return the Deposit to Buyer and thereafter neither party
shall have any further rights or obligations hereunder, except for those which
by their terms survive termination hereof.
3.2 Seller shall furnish to Buyer within five (5) days after the date
hereof, a current rent roll, lease abstracts and copies of the Tenant Leases,
pertaining to the Property, a copy of a title report, and copies of all surveys,
mechanical, structural and environmental reports pertaining to the Property,
which Seller has in its possession and Seller shall cause its representatives to
respond truthfully and completely to any inquiries by Buyer regarding the same.
3.3 Seller, and/or its agents, agree to cooperate fully with Buyer and
its agents, consultants and employees during the Due Diligence Period and shall,
after receiving reasonable notice, and subject to the rights of the tenants
under the Tenant Leases, provide Buyer with full access during regular business
hours to the Property (including related financial, operational and leasing
records, including, as and to the extent the same are in Seller's possession,
copies of all plans, specifications, as-built drawings, engineering data,
mechanical, structural and environmental investigations (including
communications to and from the New Jersey Department of Environmental Protection
("DEP")), consultants' reports, utility agreements, certificates of occupancy,
soil reports, zoning compliance reviews, leases, service contracts, maintenance
and repair records, tax bills, insurance bills, insurance policies, and books
and records relating to the Tenant Leases. If this Agreement terminates without
Buyer's acquisition of the Property for any reason, Buyer agrees to (i) repair
any damage caused to the Property arising out of Buyer's entry hereunder, and
(ii) deliver to Seller all tests, data, reports and other materials relating to
the Property obtained by Buyer (including without limitation all items provided
to Buyer by Seller). Buyer hereby agrees to indemnify, defend and hold Seller
harmless against any loss, damage, liability, or expense, including reasonable
attorneys' fees, arising out of Buyer's activities pursuant to this Article 3
and/or Buyer's failure to promptly repair the Property when required hereunder,
and/or incurred by Seller in enforcing this Article 3. Buyer's obligations and
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indemnity under this Article shall survive termination of this Agreement. All
of Buyer's activities on the Property pursuant to this Article 3, shall be
coordinated verbally, a reasonable time in advance, with Seller's authorized
representative, Laurie Korth, at (609) 354-2200.
3.4 If Buyer fails to terminate this Agreement as provided in Section
3.1, Buyer shall be obligated to proceed to Closing (as hereinafter defined),
and to increase the Deposit as provided in Section 2.1(a), and the Deposit will
be nonrefundable except if, and as, expressly otherwise provided herein.
Article 4
CLOSING
4.1 Closing of this transaction shall, subject to the terms of this
Agreement, take place at the offices of Archer & Greiner, a Professional
Corporation, One Centennial Square, Haddonfield, New Jersey 08033, and shall
occur at 10:00 a.m. prevailing time or such other time as may be mutually
agreeable to Seller and Buyer on June 14, 1996 (the "Closing Date" or
"Closing"); provided, however, Buyer shall use its best efforts to close on or
before May 31, 1996. Buyer may at its option close earlier than such date by
giving Seller at least ten (10) days advance notice of such early Closing Date,
provided that no unrepaired Terminable Loss (as hereinafter defined) shall exist
at the date of giving of such notice. Such time for Closing and all dates for
performance hereunder are "of the essence" of this Agreement. Formal tender of a
deed to the Property by Seller and of the purchase price by Buyer are hereby
waived.
4.2 Closing hereunder shall be and hereby is conditioned upon each of
the following (the "Closing Conditions"):
(a) Title. Title shall be in the state required by the terms and
provisions of Article 6.
(b) Representations. The representations and warranties contained
in Article 8 shall be true and correct in all material respects as of the
Closing Date.
(c) Obligations. Seller and Buyer shall have performed all of
their respective obligations under this Agreement.
(d) In addition to any other conditions set forth in this
Agreement, Buyer's obligation to close hereunder is subject to each and all of
the following conditions precedent:
1. All of Seller's representations and warranties contained
in Paragraph 8.1 and elsewhere in this Agreement shall be true and correct when
made and also as of the Closing Date.
2. All documents, instruments and assurances required to be
delivered on or before Closing to Buyer shall have been duly delivered in form,
substance and execution satisfactory to Buyer in its reasonable discretion.
3. All covenants and agreements of Seller herein shall have
been duly performed and satisfied.
If Seller has not satisfied any one or more of the conditions precedent
contained in subparagraphs 1, 2 or 3 immediately above have not been satisfied
on or before the Closing Date, Buyer may exercise any one or more of the rights
and remedies set forth in Paragraph 12.1 hereof.
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4.3 Either party may waive any Closing Condition which has been
included for its benefit, and if Closing hereunder occurs, any Closing Condition
shall be deemed to have been waived which has not been satisfied.
Article 5
CLOSING COSTS AND ADJUSTMENTS
5.1 All real property taxes, and any other charge in lieu of taxes
levied or assessed against the Property by any public or quasi-public authority
shall be adjusted between the parties hereto at Closing.
5.2 Buyer and Seller shall each bear one-half of the cost of any state,
county or other transfer tax and recording fees incurred. Buyer shall be
responsible for all title charges incurred (including attendance fees) to
include the cost of a lender's policy of title insurance issued to Seller in the
amount of the Note.
5.3 If at the time of Closing, the Property or any part thereof shall
be or shall have been affected by a confirmed assessment or assessments (that
is, any assessment the first installment of which has been paid), then for the
purposes of this Agreement all the unpaid installments of any such assessment,
including those which are to become due and payable after the Closing, shall be
deemed to be due and payable and to be liens upon the Property and shall be paid
and discharged by Seller at or prior to the Closing. Unconfirmed improvements or
assessments, if any shall be Buyer's responsibility.
5.4 Water and sewer rates and charges shall not be adjusted but shall
be paid by Seller based upon a current meter reading to be obtained by Seller;
any advance payments relating to a period on and subsequent to the Closing Date
shall be credited to Seller and assigned to Buyer. In addition, sewer, gas,
electric and other utility charges shall not be adjusted but shall be paid by
Seller based upon a current reading by the utilities to be obtained by Seller.
5.5 Rents and all other charges (including cost reimbursement payments)
paid under the Tenant Leases shall be adjusted at Closing pursuant to an
allocation schedule, such schedule to allocate: (i) security deposits, (ii) 1995
operating expenses, (iii) 1996 estimated operating expenses and other prepaid or
accrued items and expenses, including any rents which have accrued but are
unpaid at the Closing Date. If any rents under the Tenant Leases (including
expense reimbursement payments) are payable or accruable on the basis of
estimates or formulae and are subject to adjustment after the Closing Date, and
become the subject of disputes with tenants regarding such rents or charges,
Buyer shall give Seller written notice thereof within ninety (90) days following
Closing and Buyer shall be entitled to offset the amount of the claimed
overcharge and shall assign all claims against the applicable tenant with
respect to such dispute to Seller.
5.6 All charges, payments and deposits under the Service Contracts
shall be adjusted at Closing.
5.7 If any of the foregoing cannot be apportioned at Closing because of
the unavailability of the amounts which are to be apportioned, such items shall
be apportioned as soon as practicable after the Closing Date. All adjustments
and prorations under this Article 5 shall be made as of 11:59 p.m. on the day
prior to the Closing Date; that is, all income and expenses for the Closing Date
shall be for the account of Buyer.
5.8 Buyer will be responsible for all of its own expenses incurred in
its investigation and acquisition of the Property, including without limitation,
all charges by its agents, contractors and consultants, and recording fees, all
title company charges, title and survey costs, and fees and costs of its
counsel. Seller will be responsible for the fees and costs of its counsel.
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5.9 The provisions of this Article 5 shall survive Closing.
Article 6
TITLE
6.1 Conveyance to Buyer of title to the Property shall be by delivery
of Seller's bargain and sale deed with covenants against the grantor's acts
("Seller's Deed"), in recordable form, conveying good, insurable and marketable
fee simple title to the Property subject only to the Permitted Exceptions and
real estate taxes not due and payable at the date of Closing.
6.2 Conveyance to Buyer of title to (i) the Personal Property shall be
by delivery of Seller's bill of sale with covenants and general warranties of
good and marketable title (but without warranties of quality, merchantability,
or fitness for purpose or use) free and clear of all security interests, liens,
charges, claims and encumbrances, and (ii) the remainder of the Assets shall be
by delivery of Seller's unconditional deeds, assignments and other conveyance
instruments as set forth herein with covenants and general warranties of good
and marketable title, free and clear of all security interests, liens, charges,
claims and encumbrances.
6.3 This Agreement and the Closing hereunder is conditioned upon
Buyer's being entitled to obtain upon payment of the appropriate premium, an
ALTA-B Owner's Policy of Title Insurance in the full amount of the Purchase
Price by any reputable title insurance company licensed to do business in the
State of New Jersey, at regular rates, which policy shall insure that the fee
simple title to the Property is vested in Buyer free and clear of all liens and
encumbrances other than the exceptions set forth on Exhibit "C" as well as all
other matters revealed by the Title Commitment (as hereinafter defined) and not
objected to by Buyer during the Due Diligence Period (the "Permitted
Exceptions"). During the Due Diligence Period, Buyer shall obtain, and deliver a
copy thereof to Seller, a commitment (the "Title Commitment") for the issuance
at Closing, upon payment of the premium therefor, of Buyer's Title Policy for
the Property.
6.4 As soon as practicable after the date hereof, Buyer, at Buyer's
expense, may order a current as-built survey ("Survey") by a licensed surveyor,
acceptable to Buyer and Title Company, of the Property which shall describe the
Property, be dated after the date hereof, and contain a surveyor's certificate
in favor of Buyer, the Title Company and such other parties as Buyer shall
designate in form and substance satisfactory for, among other things, deletion
of the standard survey exception from the title insurance policy and consistent
with and as required by the next succeeding sentences.
6.5 Buyer shall request Title Company and such licensed surveyor to
deliver to Seller copies of the Commitment and Survey at such times as same are
delivered to Buyer. If the matters revealed by the Commitment and the Survey,
other than the following matters:
a. real estate taxes not yet due and payable at the date of the
Commitment;
b. liens, charges, claims and encumbrances of a definite or
ascertainable monetary amount, all of which shall be paid off or removed of
record by Seller, at Seller's expense, and released at Closing, and Seller
agrees so to do and effect same;
c. matters which the Commitment states will be removed upon
presentation of Seller's ALTA Statement and other documentation, which ALTA
Statement and other documentation shall be presented by Seller at Closing, and
Seller agrees so to do, and which matters shall be so removed from the title
insurance policy at Closing;
d. public utility easements which do not underlie the
Improvements and do not otherwise interfere with the ownership, use or operation
of the Property; and
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e. Permitted Exceptions
are not satisfactory to Buyer, such matters not so satisfactory to Buyer
hereinafter called "Unsatisfactory Matters", then, at the election of Buyer, at
Buyer's sole discretion, Buyer, unless Seller (with Buyer's approval, which
approval may be withheld by Buyer at its sole and unreviewable discretion)
causes Title Company to delete such Unsatisfactory Matters from the Commitment
or commit to insure over such Unsatisfactory Matters in a manner satisfactory to
Buyer, at any time on or prior to the Closing Date (by notice to Seller which
may be orally given) may terminate this Agreement, in which event the Deposit
and Buyer's reasonable out-of-pocket expenses not to exceed Twenty Thousand
Dollars ($20,000), shall be returned to Buyer and neither party shall have any
further rights, obligations or liabilities hereunder. If Buyer does not so elect
to terminate, Buyer may attempt to cure such Unsatisfactory Matters, such cost
to be borne by Seller in an amount not to exceed Twenty Thousand Dollars
($20,000), the remaining Unsatisfactory Matters set forth in the Survey and
Commitment shall become part of the Commitment and the state of title shown in
the Commitment shall be deemed acceptable to Buyer and Seller shall have no
further obligation in respect of such remaining Unsatisfactory Matters. Such
Unsatisfactory Matters shall thereupon become so-called "Permitted Exceptions"
and may be set forth as permitted encumbrances in Seller's Deed.
6.6 Buyer's obligation to close hereunder shall be conditioned upon
Seller's being able, at Closing, to deliver to Buyer title to the Property,
fee-simple, free and clear of all liens, claims and encumbrances other than the
Permitted Exceptions; and, if Seller is not able to so deliver title or correct
or cure the Unsatisfactory Matters, Buyer may either accept such title as Seller
can deliver, pursue any remedy or modification of any noted title or survey
defect, the cost thereof to be reimbursed by Seller in an amount not to exceed
Twenty Thousand Dollars ($20,000) or terminate this Agreement in which event the
Deposit and Buyer's out-of-pocket expenses not to exceed Twenty Thousand Dollars
($20,000) and, thereafter, shall be forthwith returned to Buyer and thereafter
neither party shall have any further rights or obligations hereunder, except for
those which by their terms survive termination hereof. However, if the Property
shall be subject to any liens or encumbrances in a fixed or ascertainable
amount, Seller shall pay same at or prior to Closing, and may use the proceeds
of Closing for such purpose, and if Seller does not satisfy same at or prior to
Closing, Buyer shall have the right in addition to all other remedies provided
for herein and at law or in equity, to satisfy same at Closing and deduct the
cost thereof from the Purchase Price to be paid at Closing.
6.7 In connection with the owner's title insurance policy which Buyer
intends to obtain in connection with this transaction, if the Title Commitment
is obtained and delivered to Seller prior to the end of the Due Diligence
Period, along with specific requests and forms of documents therefor reasonably
satisfactory to Seller's counsel, Seller undertakes and agrees to provide such
information to, and execute such certificates and affidavits as comport with the
actual state of facts in existence as of the Closing Date, for the benefit of
and as are reasonably and customarily required by, the issuing title insurance
company, in order that Buyer may have any exclusions or exceptions to coverage
removed (other than the Permitted Exceptions) including, without limitation,
those pertaining to creditors' rights and fraudulent conveyances.
6.8 Seller agrees to execute and deliver and to do or cause to be
executed and delivered and to be done any documents and agreements and any
things which may be necessary to or desired by Title Company to furnish the
required title insurance.
Article 7
DELIVERIES AT CLOSING
7.1 At Closing, Seller will deliver or cause to be delivered to Buyer
the following:
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(a) Deed. Seller's Deed, duly executed and acknowledged and in
proper form for recording, and an affidavit of title duly executed and
acknowledged.
(b) Estoppel Letter. A sworn-to, notarized estoppel certificate to
Buyer in form reasonably agreed upon by Buyer's lender, from HIP Rutgers, Klehr
Harrison, First Union National Bank, as successor to First Fidelity Bank, N.A.,
and Shapiro and Kreisman (collectively, the "Key Tenants") and Seller shall use
its reasonable efforts to obtain such estoppel letters from the other tenants,
all dated no earlier than May 1, 1996.
(c) Security Deposits. The security deposits (subject to
adjustment as provided in Article 5 hereof).
(d) Physical Possession. Actual physical possession of the
Property (and at the Property all keys and passes thereto), subject only to the
rights of the tenants under the Tenant Leases.
(e) Intentionally Omitted.
(f) Bill of Sale and Assignment. A duly executed Bill of Sale and
Assignment and Assumption Agreement in form reasonably acceptable to Buyer and
Seller.
(g) Letter to Tenants. Executed letters to the tenants under the
Tenant Leases advising that Seller has transferred title to the Property to
Buyer and that all payments of rent and additional rent are to be remitted
directly to Buyer.
(h) Leases. At the Property, fully executed counterparts of all
Tenant Leases and the files relating thereto.
(i) Books and Records. At the Property, copies of all current
books and records of Seller reflecting the calculation, payment and receipt of
all taxes, operating expenses and other additional rent under the Tenant Leases.
(j) Building Plans. At the Property, true and complete set of all
as-built building plans, specifications and drawings (and of all documents and
other materials related thereto for the Property), if available.
(k) Tax Bills. The 1994 and 1995 and the most currently received
original tax bills for the Property.
(l) Permits. At the Property, and to the extent available, the
originals of all certificates of occupancy for individual tenants and all
current permits (including all amendments, modifications, supplements and
extensions thereof) issued in connection with the operation of the Property
except to the extent the same are required to be and are affixed to the
Property.
(m) Manuals. At the Property, all manuals, diagrams, shop
drawings, warranties, and related data in possession of Seller concerning the
Property and the use and maintenance of its systems and facilities.
(n) Evidence of Authority. Evidence of Seller's existence,
good standing and of Seller's authority to execute and deliver this Agreement
and all documents required to be delivered by Seller hereunder.
(o) ISRA Non-Applicability. A letter from the DEP that indicates
that the Property is not subject to the Industrial Site Recovery Act ("ISRA"),
the cost of the application fee to be borne by Buyer.
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(p) Assignment of Guaranties. Seller's duly executed assignment of
all guaranties and warranties from all manufacturers of, or other guarantors or
warrantors in respect of, all equipment, appliances or other things installed
or used in the Property, and from all contractors, suppliers and materialmen
with respect to all work and installations done at the Property, to the extent
same are in existence.
(q) Assignment of Permits. Seller's duly executed assignment of
all certificates, permits, licenses, franchises, authorizations and approvals
which Buyer desires to have assigned to it, and all of Seller's rights
thereunder, together with the originals thereof.
(r) Certificate of Seller. Seller's duly executed certificate
of reaffirmation and re-making and confirmation dated as of the Closing Date
that the warranties and representations of Seller in this Agreement are true and
correct as of the Closing Date.
(s) Opinion of Counsel. An opinion of Seller's counsel, Archer &
Greiner, addressed to Buyer, dated as of the Closing Date to the effect that:
1. Seller is a corporation duly created, existing and in
good standing under the laws of the State of New Jersey. Seller has the
requisite power and authority to enter into and perform the terms of this
Agreement and its closing documents; the exception and delivery of this
Agreement and its closing documents have been duly authorized by Seller and no
other proceedings on Seller's part are necessary in order to permit Seller to
consummate this transaction and its closing documents.
2. This Agreement and its closing documents have been duly
executed and delivered by Seller and constitute legal, valid and binding
obligations of Seller, enforceable in accordance with their terms, subject to
applicable bankruptcy, reorganization, moratorium, insolvency and other laws and
principles affecting or limiting creditors' rights generally, and subject to all
other applicable federal and state laws, statutes, ordinances, rules and
regulations, decisions of federal and state courts, and constitutional
requirements which may modify, limit, render unenforceable or delay certain of
the rights and remedies of Buyer, which other applicable matters will not
diminish the practical realization of the benefits intended to be conferred by
the Agreement and its closing documents on Buyer (except for the economic
consequences of any judicial, administrative or other procedural delay which may
be imposed by, relate to or result from such laws, statutes, ordinances, rules,
regulations, decisions or constitutional requirements).
(t) FIRPTA. A certificate that Seller is not a "foreign person"
as defined in the Federal Foreign Investment in Real Property Tax Act of 1980
and the 1984 Tax Reform Act, as amended, in a form complying with federal
tax law.
(u) Allocation Schedule. A mutually agreed upon schedule as
required by Paragraph 5.5 hereof.
In addition to the obligations required to be performed hereunder by Seller at
Closing, from time to time subsequent to the Closing, Seller shall perform such
other acts, and shall execute, acknowledge and deliver such other agreements and
documents as Buyer reasonably may request in order to effectuate the
consummation of the transaction contemplated herein consistent with the terms
hereof, or as may be needed, to vest good, insurable and marketable title to the
Assets in Buyer or its assignee or nominee.
7.2 At Closing Buyer will deliver or cause to be delivered to Seller
the following:
(a) Purchase Price. The unpaid portion (net of the Deposit and
the Note) of the Purchase Price.
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(b) Loan Documents. Duly executed, acknowledged and in form for
recording or filing (as applicable) originals of the Loan Documents, as well as
the lender's policy of title insurance required under Section 5.2.
(c) Counterparts. Duly executed counterparts of the documents
provided for in Sections 7.1 (f) and (g).
(d) Other Documents. Any other document expressly to be delivered
by Buyer pursuant to any other provision of this Agreement.
7.3 At Closing, the Title Company shall deliver the Deposit to Seller.
Article 8
WARRANTIES AND REPRESENTATIONS OF SELLER AND BUYER
8.1 As a material inducement to Buyer to enter into this Agreement and
to proceed to its consummation on the Closing Date, Seller makes the following
representations, warranties, and agreements, to the best of its knowledge, such
knowledge being that of Arthur W. Hicks, Jr. and Terry Cassidy, as follows, all
upon which Buyer relies:
(a) Subject to the Permitted Exceptions and the rights of
tenants under Tenant Leases, Seller is the fee simple owner of and is lawfully
seized and possessed of the Assets, there are no outstanding agreements of sale
or options with respect to the Property, and no party or entity has any rights
to possess or occupy the Assets. Seller does not own any property contiguous to
the Assets.
(b) To the best of Seller's knowledge, neither the execution nor
delivery of this Agreement, nor the consummation of the transactions described
herein or contemplated hereby nor compliance with the terms hereof by Seller
will conflict with or result in the breach of any terms of, or constitute a
default under any agreement or instrument of any kind to which Seller is a
party or by which Seller is bound.
(c) Seller has received no notice of any currently pending
Condemnation (as hereinafter defined) affecting the Property, or of any
currently pending proceedings to change the zoning, which is Commercial, of the
Property.
(d) Seller has received no notice of unconfirmed or confirmed
assessments against the Assets.
(e) Seller has not received service of process or similar formal
notice with respect to any actions, litigation, suits, proceedings, appeals
(including, without limitation, tax or assessment appeals) or claims affecting
the Assets which, if determined adversely to Seller or the Assets, would have a
material adverse effect on the operation of the business of the Assets as
currently conducted or render title to the Assets unmarketable.
(f) Seller has made no application, submission or request for
any site plan approval, subdivision approval, variance, waiver, license, sewer
permit, building permit or any other approval from any governmental authority,
for development and/or use of the Property, which is now pending.
(g) Seller is not a "foreign person" as such term is defined
pursuant to the Foreign Investment in Real Property Tax Act (FIRPTA) of the
Internal Revenue Code. Seller's Federal Employee Identification Number is
22-3304872.
(h) The Property is currently subject to the leases described
on Exhibit "D" attached hereto (the "Tenant Leases"). Seller has not entered
into any other leases, tenancies, licenses or other rights of occupancy or use
for any portion of the Property other than the
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Tenant Leases. Exhibit "D" also sets forth all brokerage commission agreements
relating to the Tenant Leases. Seller has not entered into any other agreements
for brokerage commissions relating to the property. As a condition precedent to
the Closing, Seller shall deliver a duly executed Estoppel Letter from each of
the Key Tenants (the "Key Tenant Estoppel Letters"). In the event that Seller is
unable to obtain the non-Key Tenant Estoppel Letters, with respect to any of the
Tenant Leases, such failure shall not be deemed a default hereunder. Title shall
be transferred at Closing subject to and together with the benefit of the Tenant
Leases. The copies of the Tenant Leases furnished to Buyer are true, correct and
complete copies thereof and such Tenant Leases have not been modified or amended
except pursuant to the amendments delivered to Buyer; such Tenant Leases are in
full force and effect; no rent or additional rent has been paid thereunder in
advance of the due date; to the best knowledge of Seller, there is no default by
landlord or tenant in the keeping, observance or performance of any material
covenant, agreement, term, provision or condition contained therein; to the best
knowledge of Seller, none of the tenants have any rights to offsets, deductions
or defenses of the payment of any rent or additional rent except as may be set
forth in the Tenant Leases; and there are no option to purchase, right of first
offer, right of first refusal or other provision granting to the tenants the
right to acquire the Property or any portion thereof or any right to terminate
any of the Tenant Leases in the event of a sale of the Property except as may be
set forth in the Tenant Leases; Seller has received and holds no security
deposit in respect of the Tenant Leases other than as disclosed in Exhibit "D".
(i) The Property is currently subject to the management, leasing,
service or maintenance contracts and other commitments described on Exhibit "E"
attached hereto (the "Service Contracts"); provided however, that Buyer shall
only be obligated to assume those Service Contracts which are cancelable on not
more than thirty (30) days notice pursuant to their terms. There are no
agreements with respect to the operation or maintenance of the Property which
would be binding upon Buyer after Closing other than the Service Contracts and
certain of the Permitted Exceptions. Title shall be transferred at Closing
subject to and together with the benefit of the Service Contracts.
(j) Seller is not in the hands of a receiver nor is an
application by Seller for the appointment of a receiver pending; Seller has not
made an assignment for the benefit of creditors, nor has Seller filed, or to its
best knowledge had filed against it, any petition in bankruptcy.
(k) Seller shall deliver to Buyer by April 15, 1996 a list of
all certificates, permits, licenses, franchises, authorizations and approvals
issued respecting the ownership, use, access, occupancy, repair, maintenance or
operation of the Property by Seller. To the extent that they are assignable to
Buyer, Buyer shall be entitled to the use and benefit of all of same upon
consummation of the transaction contemplated hereby without any further action
of the parties hereto. Copies of all of same have been delivered to Buyer.
(l) Water, sewer, gas, electricity, telephone and cable are
currently serving the Property and operating and all installation and connection
charges payable as of the date hereof have been paid in full.
(m) There has been no damage to any of the Assets by fire or other
casualty or any act of God prior to the date hereof.
(n) Seller has no actual knowledge (but without any obligation
of inquiry) and has received no written notice from tenants or the Township of
latent defects in any of the Improvements, and the structural components,
exteriors, electrical, gas, plumbing, water, sewer, air conditioning, heating,
ventilating, exhaust, mechanical, security, disability, life/safety and other
building systems.
(o) Seller has not received written notice nor does Seller have
actual knowledge of any:
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1. pending grievances or arbitration proceedings or
unsatisfied arbitration awards, or judicial proceedings or orders respecting
awards, relating to the Property or its ownership, operation or occupancy;
2. outstanding unfulfilled requirements or recommendations
of any insurance company, any inspection or rating bureau or any board of
underwriters concerning the Property or any operation, condition, repair or
alteration thereof;
3. pending or actual claims, charges, complaints, petitions
or unsatisfied orders or any threat thereof, by or before any administrative
agency or court respecting alleged obligations of the owner, operator or any
occupant of the Property or any part thereof that might materially and adversely
affect the Property, the ownership, operation or occupancy of the Property or
any part thereof or any person acquiring ownership, operation or occupancy of
the Property through such owner, operator or occupant; or
4. any other action, proceeding or investigation pending or
threatened against or involving Seller or the Property that might so affect the
Property or such person so acquiring title or occupancy.
(p) No equipment or article of personal property owned by
Occupancy Tenants and removable by them is material to the operation of the
Property.
(q) Seller has not received any written notice, nor does Seller
have any actual knowledge of any increase in assessed value nor of any other
assessments, which would increase such taxes or assessments above such amount
for years subsequent to such bill. Seller has not received any assessment
notices against the Property with respect to any governmental improvements which
have been substantially completed prior to the date hereof and for the cost of
which the Property can be assessed. There are no unpaid assessments (including
special assessments) levied or assessed against the Property, including unpaid
installments for or in respect of any such assessments, and Seller has not
received notice of any pending or threatened increase thereof.
(r) Seller has caused to be furnished to Buyer copies of
unaudited statements of income and expense for each of the months in 1994 and
1995. Each of such monthly financial statements (i) is in accordance with the
respective books and records of Seller and (ii) presents fairly and accurately
the results of operations for the respective periods covered thereby. All of the
books and records relating to the Assets given to Buyer or its representatives
accurately and correctly reflect the ownership and operation of the Assets and
all income received and expenses incurred by Seller in connection therewith.
(s) Seller is not a "foreign person" as defined in the Federal
Foreign Investment in Real Property Tax Act of 1980 and the 1984 Tax Reform Act,
as amended.
(t) Except as set forth in the Phase I Report of TTI
Environmental, Inc. and the 1992 Handex Phase I Report prepared for Midlantic
National Bank and the Phase I Report prepared by ENSR regarding Lots 2 and 3,
copies of which have been delivered to Buyer, Seller has no actual knowledge of,
nor has Seller received written notice of, any environmental condition,
pollutant, or hazardous or toxic substance, the presence of which would
adversely affect the Assets.
(u) Seller (i) has paid all commissions and other compensation
payable to any broker or other agent or any other party under or in respect of
the Pepper, Hamilton & Scheetz Lease and the other Tenant Leases, (ii) has
completed any work required to be performed or furnished, as applicable, by
lessor under or in respect of the Pepper, Hamilton & Scheetz Lease and the other
Tenant Leases and (iii) has paid all tenant allowances and concessions under or
in respect to the Tenant Leases.
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8.2 All of the covenants, agreements, representations and warranties of
Seller contained in this Agreement shall be deemed remade on and as of Closing,
shall survive the Closing, and shall not be deemed to merge upon the delivery
and acceptance of Seller's Deed or any other conveyance document (except that
the representations and warranties contained in Paragraph 8.1 (except for those
representations and warranties contained in subparagraph (s) which shall survive
indefinitely and except for the representations and warranties contained in
subparagraph (t) which shall survive for one year from Closing) which shall
survive the Closing for a period of six (6) months only); provided, however,
that Buyer shall not be entitled to make any claim against Seller for a breach
of a representation or warranty under this Agreement until the aggregate loss
incurred by Seller as a result thereof exceeds $5,000, and upon exceeding that
amount, Buyer shall be entitled to claim for all losses including the initial
$5,000.
8.3 To induce each other to enter into this Agreement, (i) Seller
hereby represents and warrants to Buyer that it has been duly authorized and
empowered to enter into this Agreement and to perform fully its obligations
hereunder, and such obligations constitute the valid and binding obligations of
Seller, enforceable in accordance with their terms, and that no further consents
of any other person, entity, public body or court is required in connection with
this Agreement and the performance of all of its obligations hereunder; and (ii)
Buyer hereby represents and warrants to Seller that it has been duly authorized
and empowered to enter into this Agreement and to perform fully its obligations
hereunder, and such obligations constitute the valid and binding obligations of
Buyer, enforceable in accordance with their terms, and that no further consents
of any other person, entity, public body or court is required in connection with
this Agreement and the performance of all of its obligations hereunder.
Article 9
BROKERS
9.1 Each party represents and warrants to the other party that it dealt
with no broker or other person (including The Rubin Organization) entitled to
claim fees for finders or brokerage services in connection with the negotiation,
execution, and delivery of this Agreement, except for CB COMMERCIAL REAL ESTATE
GROUP, INC. ("Broker"). Buyer shall pay all commissions or fees due to Broker
directly (and not as a credit against the Purchase Price) at Closing. Each party
agrees to defend, indemnify, and hold the other party harmless from and against
any and all claims for finder's fees or brokerage or other commissions which may
at any time be asserted against the indemnified party founded upon a claim that
the substance of the aforesaid representations and/or agreements of the
indemnifying party is untrue, together with any and all losses, damages, costs
and expenses (including reasonable attorneys' fees) relating to such claims or
arising therefrom or incurred by the indemnified party in connection with the
enforcement of this indemnification provision. The provisions of this Article
shall survive the Closing or any termination hereof.
Article 10
RISK OF LOSS
10.1 Fire and Casualty. The risk of loss or damage to the Property by
fire or other casualty not caused by Buyer or by any of Buyer's agents,
employees, contractors and consultants (a "Seller's Cause") until the Closing is
assumed by Seller. If the Property is damaged by a Seller's Cause to the extent
that the cost to repair the Property will exceed $50,000 (a "Terminable Loss")
and the Property is not repaired by Seller prior to the Closing Date, Buyer may
at Buyer's sole option, (a) proceed to Closing without an abatement in Purchase
Price (except for any deductibles as hereinafter provided) and Seller shall
assign all of its insurance claims, including without limitation, casualty and
rent interruption insurance (except for Seller's portion of the rent
interruption insurance up to the Closing Date) and Seller will give Buyer a
credit against the Purchase Price for any deductibles; or (b) terminate this
Agreement by notice to Seller, in which event, the Deposit shall be immediately
returned to Buyer and thereafter neither party shall have any further rights or
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obligations hereunder, except for those which by their terms survive termination
hereof. If the Property is damaged by a Seller's Cause to the extent that the
cost to repair the Property will not exceed $50,000 and the Property is not
repaired by Seller prior to the Closing Date, the parties shall proceed to
Closing and Seller shall pay Buyer in cash the estimated cost to repair such
damage (or Seller shall adjust the Note appropriately). The extent of damage due
to a Seller's Cause not to be repaired by Seller prior to the Closing Date,
shall be determined as promptly as practicable after occurrence of such damage,
by the estimate of an independent, reputable contractor, licensed and operating
in the general area in which the Property is located, engaged by Seller but
reasonably acceptable to Buyer for the purpose of providing such estimate.
10.2 Condemnation. In the event that at any time prior to the Closing,
any proceedings shall be commenced or consummated for the taking of all or any
part of the Property, which would materially adversely affect the value of the
Property or the continued conduct of business thereon as currently being
conducted, for public or quasi-public use pursuant to the power of eminent
domain, condemnation or otherwise (a "Condemnation"), Seller shall forthwith
give written notice thereof to Buyer. Buyer may, at its option, within seven (7)
days of receipt by it of notice of such Condemnation, but in any event not later
than one (1) business day prior to the Closing Date (unless such notice of
Condemnation is given later than two (2) business days prior to the Closing
Date, in which event, Buyer shall make its election prior to Closing) elect by
sending notice thereof to Seller either of the following: (a) to terminate this
Agreement, in which event the Deposit shall be immediately returned to Buyer and
thereafter neither party shall have any further rights or obligations hereunder,
except for those which by their terms survive termination hereof; or (b) to
proceed with this Agreement without an abatement in the Purchase Price, in which
case Seller shall assign any and all awards and other compensation to which
Seller is entitled for such Condemnation to Buyer.
Article 11
NOTICES
Any notices, consents, approvals, submissions or demands (which
notices, consents, approvals, submissions or demands shall be hereinafter
collectively called "Notices") given under this Agreement or by applicable law,
rule or regulation by Seller to Buyer or by Buyer to Seller shall be in writing
(except as otherwise expressly provided for in this Agreement). Unless otherwise
required in this Agreement, any Notice shall be deemed given: (i) upon refusal,
if sent by registered or certified mail, return receipt requested, postage
pre-paid or by personal delivery or recognized national overnight courier
service delivery, or (ii) on the business day of receipt (or the business day
next following a non-business day of receipt), however delivered or transmitted
(including by facsimile) with evidence of receipt obtained prior to 5:00 pm. on
a business day (or if not received prior to 5:00 p.m. on a business day, then
upon the next business day): (a) to Seller, in duplicate, one copy to Seller at
the address set forth above, Attn.: Arthur W. Hicks, Jr., Fax No. (609)
354-2216, and the other copy to Archer & Greiner, P.C., One Centennial Square,
P.O. Box 3000, Haddonfield, New Jersey 08033, Attn.: Gary L. Green, Esquire, Fax
No. (609) 795-0574, or such other address or Fax number as Seller may designate
by Notice to Buyer, (b) to Buyer at the address set forth above, Attn.: Gerard
H. Sweeney, Fax No. (609) 797-0425 with a copy to Brad Molotsky, Esquire,
Pepper, Hamilton & Scheetz, Suite 500, LibertyView, 457 Haddonfield Road, Cherry
Hill, New Jersey 08002, Fax No. (215) 981-4930 or such other address or Fax
number as Buyer may designate by notice to Seller.
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Article 12
REMEDIES
12.1 If Seller defaults in the performance of any of its obligations
under this Agreement, Buyer may, as Buyer's sole remedy, at Buyer's election
either (i) seek to specifically enforce this Agreement against Seller in which
event Buyer shall be entitled to collect from Seller reasonable attorney's fees,
and the costs, of litigation, or (ii) cure such breach, the cost thereof to be
borne by Seller in an amount not to exceed Twenty Thousand Dollars ($20,000), or
(iii) terminate this Agreement by notifying Seller thereof, in which event the
Deposit and Buyer's reasonably documented out-of-pocket costs not to exceed
Twenty Thousand Dollars ($20,000) shall be returned to Buyer and thereafter
neither party shall have any further rights or obligations hereunder, except for
those which by their terms survive termination hereof.
12.2 If Buyer defaults in the performance of any of its obligations
under this Agreement, Seller may, as Seller's sole remedy, terminate this
Agreement by notifying Buyer thereof, in which event the Deposit shall be
immediately delivered to and retained by Seller as agreed and liquidated damages
hereunder, the parties acknowledging that Seller's damages arising in the event
of such default are difficult, if not impossible to ascertain, and in such
event, thereafter neither party shall have any further rights or obligations
hereunder, except for those which by their terms survive termination hereof.
Article 13
SELLER COVENANTS
13.1 Seller covenants and agrees during the term of this Agreement as
follows:
(a) To maintain in full force and effect any and all fire and
casualty insurance and public liability insurance in amounts not less than that
currently covering the Property.
(b) Seller shall not make any new Tenant Leases ("New Tenant
Leases") or any amendments (including extensions and renewals) of or cancel any
existing Tenant Leases without Buyer's prior written consent; provided, however,
Seller shall cooperate with Buyer in presenting new proposals to potential
tenants at rates and terms acceptable to Buyer and Seller shall accompany Buyer,
after prior written notice, on such proposal meetings.
(c) Seller shall promptly deliver to Buyer copies of, and shall
comply with all notices of violations of laws, ordinances, orders, regulations
or requirements including but not limited to zoning, building, health, safety,
disability, pollution control, environmental, fire or similar laws, ordinances,
orders and regulations issued by, filed by or served by, any governmental agency
having jurisdiction over the Assets, against or affecting the Assets, at
Seller's sole cost and expense; the Property shall be conveyed to Buyer free
and clear of any and all violations of which Seller has received notice prior
to the Closing, any of the foregoing on the Closing Date.
(d) From and after the date hereof, Seller shall, in connection
with the Assets:
1. carry on its business in, and only in, the usual, regular
and ordinary course;
2. perform all of its obligations under agreements and
instruments relating to or affecting its properties, assets and business
(including, without limitation, all Tenant Leases);
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3. maintain its books of account and records in the usual,
regular and ordinary manner;
4. comply with all laws, ordinances, orders, regulations and
requirements applicable to it, the conduct of its business and the Assets;
5. promptly advise Buyer in writing of (i) any material
adverse change (or threat thereof) which shall come to the attention of or
become known by Seller in the condition (financial or otherwise), operations or
business of Seller or the Assets, and (ii) (without regard to materiality) any
notice to Seller of any violation or alleged violation of any obligation or
agreement;
6. without Buyer's prior written consent, not sell, encumber
or grant any interest in the Assets or any part thereof in any form or manner
whatsoever and not perform or permit any act or thing which might diminish or
otherwise adversely affect Buyer's interest under this Agreement or in or to the
Assets or any part thereof or which might prevent Seller's full performance of
its obligations under this Agreement.
(e) After the date hereof and until the Closing Date, Seller
will use its best and diligent efforts to keep Buyer timely and fully informed
of any developments which might cause any of the foregoing representations and
warranties to be no longer accurate.
(f) Subject to Seller's obligation to keep, repair, replace
and maintain the Assets and to the other provisions hereof, Seller shall deliver
possession of the Assets to Buyer at Closing in the same condition at the
Closing as on the date hereof, excepting therefrom only ordinary interim wear
and tear thereto after the date of the last required repair or replacement.
(g) Not to encumber or lien or wilfully permit to be
encumbered with any encumbrance, lien or other claim of right which may affect
title thereto, the Assets, or other rights, appurtenances and herediments to be
conveyed pursuant to this Agreement.
13.2 Between the date of the execution of this Agreement and the
Closing Date, Seller shall:
(a) Maintain the Property in its present condition, reasonable
wear and tear, and damage by fire and casualty excepted, including without
limitation, periodic and seasonal maintenance (such as maintenance of lawns,
shrubbery, walks, parking areas and other common areas in the usual and
customary manner). Seller shall deliver the common areas of the Property to
Buyer at Closing, in broom clean condition, free and clear of all debris.
(b) Operate and manage the Property in substantially the same
manner as it has been operated and managed prior to the date of this Agreement,
and shall further arrange and pay for the "sealing" of balconies at the
Property.
(c) Comply with all of the material obligations of Seller
under the Tenant Leases, including the obligation to pay leasing commissions due
on or before Closing and tenant fit-up costs for the Pepper, Hamilton & Scheetz
lease and the Service Contracts.
(d) Not enter into any Service Contracts for or on behalf of
or affecting the Property unless same may be terminated upon not more than
thirty (30) days prior notice or materially modify, cancel, accept surrender of,
or accept any advance rental under any of the Tenant Leases, or materially
modify any Service Contract, or after the end of the Due Diligence Period,
execute any new lease for any portion of the Property, all without the prior
written consent of Buyer.
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Article 14
ACCESS
14.1 Buyer, its agents, employees, contractors and consultants or such
person or persons as Buyer may designate, shall have the unrestricted right at
all reasonable times upon prior notice to Terry Cassidy in order to enter the
Property from time to time together with personnel and materials at any time
after the execution of this Agreement for the following purposes:
a. To make physical inspections of the subject Assets including
subsurface tests, test borings, water survey, drainage tests, percolation tests,
topographic surveys, environmental tests, geotechnical tests, drainage
calculations and other tests, studies or surveys as Buyer deems necessary in its
sole discretion;
b. To drive test piles and to make surveys of the Assets showing
all information normally and usually required by a surveyor;
c. For architectural and engineering purposes;
d. The right to show the Assets to prospective lenders or
tenants at all reasonable times on reasonable notice to Seller; and
e. For any other purpose or purposes in connection with
satisfying or furthering any condition or contingency contained in this
Agreement or for any other reason as Buyer deems necessary in its reasonable
discretion.
14.2. Buyer hereby agrees to indemnify Seller and hold it harmless from
and against any and all loss, cost, liability, or expense, including reasonable
attorney's fees, arising out of any damage to the Assets as a result of Buyer or
Buyer's agents' entry onto the Assets.
Article 15
ENVIRONMENTAL MATTERS
15.1 Seller shall obtain and deliver to Buyer (and/or any designees or
assignees), Buyer to pay for the sole cost and expense of DEP's
Non-Applicability Application, from the DEP within forty-five (45) days from the
date hereof, the ISRA approval (the "ISRA Approval") pursuant to ISRA consisting
of (i) a non applicability letter, or (ii) non-qualified approval acceptable in
Buyer's sole discretion, of Seller's remediation conducted pursuant to ISRA. In
the event Seller is unable to deliver the ISRA Approval, Buyer shall have the
option of (a) extending from time to time the period of time for Seller to
obtain the ISRA Approval (during which period the Closing Date shall be
postponed); or (b) terminating this Agreement at the end of such forty-five (45)
day period or any extension thereof, in which case the Deposit shall be returned
to Buyer and Seller shall reimburse Buyer for all survey, title examination and
other costs not to exceed Twenty Thousand Dollars ($20,000).
15.2 Seller shall promptly apply for and use its best efforts to
obtain the ISRA Approval as soon as possible.
15.3 Seller shall promptly, from time to time, deliver to Buyer true
and complete copies of all documents, reports, affidavits, submissions and
correspondence provided by Seller to DEP, if any, and all documents, reports,
directives and correspondence provided by the DEP to Seller. Seller shall also
promptly deliver to Buyer true and complete copies of all sampling and test
results obtained from samples and tests taken at and around the Assets. Seller
shall notify Buyer in advance of all meetings scheduled between Seller and DEP,
and Buyer, and its designees may attend all such meetings.
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Article 16
INDEMNIFICATION
Each party hereto hereby agrees to indemnify, hold harmless and defend
the other party, and such party's agents, employees, successors and assigns,
from and against any and all claims, demands, damages, losses, expenses,
liabilities and costs whatsoever, known or unknown, past, present or future
(including, without limitation, court costs and attorneys' fees), arising out
of, or resulting from or attributable to (a) any negligent or wrongful acts or
omissions of the indemnifying party or its agents, employees, contractors or
suppliers with respect to the Assets and (b) any breach or incorrectness of any
representation or warranty made by the indemnifying party in this Agreement,
subject to the limitations set forth in Paragraph 8.2 hereof. Additionally,
Seller hereby agrees to indemnify, hold harmless and defend Buyer, Buyer's
employees, successors and assigns, from and against any and all claims, demands,
damages, losses, expenses, liabilities and costs incurred by said indemnified
party by reason of said indemnified party's necessity to defend any suit, action
or proceeding (administrative, judicial or otherwise) brought by a third-party
against Seller or the Assets, wherein Buyer is joined as a party defendant
solely by reason of its being the contract purchaser hereunder (e.g.
condemnation actions, adjacent land owner actions, etc.). This Article shall
survive Closing and any earlier termination of this Agreement.
Article 17
AS IS
Buyer hereby acknowledges that except with respect to the specific
representations made by Seller under this Agreement, Buyer is purchasing the
Property in "as is" condition based solely upon the investigations undertaken by
Buyer and not upon the representations of any other person. Buyer shall be
solely responsible for the physical condition of the Property, including,
without limitation, the environmental condition of the Property, and shall not
make any claim against Seller related to the physical condition of the Property,
including the environmental condition of the Property (including, without
limitation, any condition above, on or below the ground), Buyer hereby
acknowledging that it has undertaken such investigations as it deems necessary
to make its own determination with respect thereto.
Article 18
MISCELLANEOUS
18.1 Date of Agreement. The date of this Agreement shall be the date
upon which it is executed by the last party to sign same and it shall be the
obligation of that party to insert the date and deliver the copies of the
Agreement to all parties who are signatories hereto.
18.2 Waiver of Contingencies. Buyer shall have the right to waive any
and all contingencies included herein for its benefit and to proceed at its own
election to perform the Agreement as if the contingencies had been satisfied.
18.3 Recordation. It is understood and agreed between the parties that
neither this Agreement nor any Memorandum of this Agreement shall be recorded
provided a Notice of Settlement may be filed by Buyer not more than ten (10)
days prior to Closing.
18.4 Applicable Law. This Agreement and the performance of this
Agreement shall be governed, interpreted and construed pursuant to the laws of
the State of New Jersey.
18.5 Entire Agreement. This writing constitutes the entire agreement
of the parties with respect to the subject matter hereof (and, without
limitation, supersedes and replaces the letter agreement dated March 21, 1996,
which shall be, and is hereby, rendered null and void and of no further
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force and effect) and may not be modified or amended, except by a written
agreement specifically referring to this Agreement signed by Seller and Buyer.
18.6 Intentionally Omitted.
18.7 Assignment. This Agreement may be assigned, transferred, or
conveyed (in whole or in part) by Buyer solely to an entity affiliated with and
controlled by Buyer, without the prior consent of Seller, provided, however,
that the original Buyer shall continue to remain jointly and severally
responsible for all obligations of Buyer hereunder. Seller shall have no right
to assign this Agreement (including any of Seller's obligations hereunder)
without obtaining the prior written consent of Buyer.
18.8 Successors. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective legal representatives,
successors, and assigns.
18.9 Headings and Exhibits. The Article and Section headings contained
herein are for the purposes of convenience only and are not intended to define
or limit the contents of said Articles and Sections. The Exhibits referred to in
this Agreement are deemed to be annexed to this Agreement and made a part hereof
as though set forth in the body of this Agreement.
18.10 Counterparts and Facsimile Execution. This Agreement may be
executed by facsimile transmissions and in any number of counterparts, each of
which shall be deemed to be one and the same instrument.
18.11 Confidentiality. Seller and Buyer shall exercise reasonable best
efforts to keep confidential the material business terms of the transaction
provided for in this Agreement. Nothing in this section is intended to restrict
any party from including such information, if the party reasonably believes such
information is necessary, (a) in any materials or discussions prepared or
conducted by it in the ordinary course of business, including reports, to its
members, shareholders, officers, directors, partners, lenders, and related
personnel, or others who have a need to know within the organization, (b) in
making of governmental or quasi-governmental filings or returns, (c) in
complying or attempting to comply with any of its obligations under this
Agreement, and (d) in dealing with its attorneys, accountants, other
professionals, and consultants. Further, nothing in this section shall restrict
any party from any release, statement or other disclosure of any matter which is
of public record, or of any matter which directly contradicts any inaccurate
statement made by another party regarding the terms of this Agreement. In no
event, however, shall Seller mention Brandywine Realty Trust in any press
release or similar disclosure without obtaining the prior written consent of
Brandywine Realty Trust.
18.12 Further Assurances. Seller and Buyer each agree to execute and
deliver all other instruments and take all other action as the other party may
reasonably request from time to time, after Closing, in order to effectuate the
transactions provided for herein. The provisions of this Section shall survive
Closing.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
SELLER:
UM REAL ESTATE INVESTMENT
COMPANY, LLC, a New Jersey limited liability
company
By: /s/ Arthur W. Hicks, Jr.
------------------------------------------
Arthur W. Hicks, Jr., Manager
BUYER:
BRANDYWINE REALTY TRUST, a Maryland
real estate investment trust
By: /s/Gerard H. Sweeney
------------------------------------------
Gerard H. Sweeney, President
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EXHIBIT "A" (Page 1 of 4)
ALL THAT CERTAIN tract or parcel of land and premises, situate in the township
of Cherry Hill, County of Camden and State of New Jersey, bounded and described
as follows:
Beginning at a point formed by the intersection of the Northeasterly line of
Chapel Avenue (width varies) with the Southeasterly line of Third Avenue (50 ft.
wide) and extending; thence
(1) North 09 degrees 49 minutes 01 seconds East, along the
Southeasterly line of Third Avenue, 142.67 feet to a point in the division line
between existing Tax Lots 1 and 2, Block 176.01; thence
(2) South 80 degrees 10 minutes 59 seconds East, along said division
line, 183.71 feet to a concrete monument in the division line between said Tax
Lots; thence
(3) South 09 degrees 49 minutes 01 seconds West, along said division
line, 52.21 feet to a set iron pin in the division line between said Tax Lots;
thence
(4) North 80 degrees 10 minutes 59 seconds West, along said division
line, 29.43 feet to a found iron pin for a corner in the division line between
Tax Lots 1, 2 and 3, Block 176.01; thence
(5) South 09 degrees 49 minutes 01 seconds West, along the division
line between Tax Lots 1 and 3, Block 176.01, 180.26 feet to a point in the
Northeasterly line of Chapel Avenue, thence
(6) North 53 degrees 04 minutes 12 seconds West, along said line of
Chapel Avenue, 163.20 feet to an angle point in same; thence
(7) North 20 degrees 28 minutes 36 seconds West, along same, l7.86 feet
to the point and place of beginning
BEING shown and designated as Lots 2 and 3, Block 176.01, Plate 18 on the
current Tax Map of the Township of Cherry Hill.
Based on a Survey of Premises dated June 27, 1994 prepared by Walter H.
MacNamara Associates, Inc.
<PAGE>
EXHIBIT "A" (Page 2 of 4)
ALL THAT CERTAIN tract or parcel of land and premises, situate in the Township
of Cherry Hill, County of Camden and State of New Jersey, bounded and described
as follows:
BEGINNING at a point in the Southerly right-of-way line of New Jersey
State Highway Route #38, said point being the corner formed by the intersection
of the said line of New Jersey State Highway Route #38 with the Easterly
right-of-way line of Third Avenue (50 feet wide), and extending; thence along
the said right-of-way line of New Jersey State Highway Route #38
(1) South 80 degrees 11 minutes 00 seconds East, 19.53 feet to an angle
point common with the Southwesterly right-of-way line of the access road (ramp
from New Jersey State Highway Route #38 to Haddonfield Road), and extending;
thence along the said right-of-way line to the access road
(2) South 45 degrees 29 minutes 39 seconds East, 336.69 feet to an
angle point, and extending; thence along the right-of-way line
(3) South 21 degrees 17 minutes 18 seconds East, 120.52 feet to a point
formed by the intersection of said access road with the Westerly right-of-way
line of Haddonfield-Sorrell Horse Road (formerly Stoy Landing Road) a/k/a Camden
County Route #E44 (formerly 66 feet wide), and extending; thence along the said
right-of-way line of Haddonfield-Sorrell Horse Road
(4) South 09 degrees 49 minutes 00 seconds West, 283.83 feet to an
angle point, and extending; thence along the said right-of-way line of
Haddonfield-Sorrell Horse Road
(5) South 24 degrees 17 minutes 14 seconds West, 96.05 feet to an angle
point, and extending; thence along the said right-of-way line of
Haddonfield-Sorrell Horse Road
(6) South 09 degrees 49 minutes 00 seconds West, 257.21 feet to a
point of curvature, and extending; thence
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<PAGE>
EXHIBIT "A" (Page 3 of 4)
(7) At the point of curvature in the Westerly right-of-way line of
Haddonfield-Sorrell Horse Road, curving to the right having a radius of 30.00
feet, and an arc length of 57.17 feet to a point of tangency connecting the
Northeasterly right-of-way line of Chapel Avenue (50 feet wide) a/k/a Camden
County #626 with the said right-of-way line of Haddonfield-Sorrell Horse Road,
and extending; thence along the said right-of-way line of Chapel Avenue
(8) North 61 degrees 00 minutes 11 seconds West, 108.14 feet to an
angle point, and extending; thence along the said right-of-way line of Chapel
Avenue
(9) North 52 degrees 03 minutes 39 seconds West, 43.50 feet to a corner
point common with Lot 3, block 176.01, on the Current Tax Map of the Township of
Cherry Hill, and extending; thence along a line common with Lot 3, Block 176.01
(10) North 09 degrees 49 minutes 00 seconds East, 178.31 feet to a
corner point common with Lots 2 and 3, Block 176.01, said tax map and lands now
or formerly of Chapel Printing, and extending; thence along a line common with
said Lot 2
(11) South 80 degrees 11 minutes 00 seconds East, 29.43 feet to a
corner point, and extending; thence along a line common with said Lot 2
(12) North 09 degrees 49 minutes 00 seconds East, 52.21 feet to a
corner point, and extending; thence along a line common with said Lot 2
(13) North 80 degrees 11 minutes 00 seconds West, 183.71 feet to a
corner point common with the Easterly right-of-way line of Third Avenue (50 feet
wide), and extending; thence
(14) North 09 degrees 49 minutes 00 seconds East, 670.63 feet to a
corner point common with the Southerly right-of-way line of New Jersey State
Highway Route #38, and being the place of beginning
<PAGE>
EXHIBIT "A" (Page 4 of 4)
BEING shown and designated as Lot 1, Block 176.01 Plate 18 on the
Current Tax Map of the Township of Cherry Hill.
ALSO BEING known as 457 Haddonfield Road.
<PAGE>
EXHIBIT "B" (Page 1 of 2)
LibertyView Building
457 Haddonfield Road
Cherry Hill, NJ 08002 Items Not Included in Sale of Property
- -------------------------------------------------------------------------------
I - INVENTORY OF MCQUAY HEAT PUMPS
- ----------------------------------
3-TON UNITS
- -----------
Model Number Serial Number G.O. Item # Open/Boxed
- ------------ ------------- ----------- ----------
CCWO36AMTE 7UK2696304 923585010 Open
" 7UK2696204 " Open
" 7UK2697004 " Open
Total Units: 3 valued at $2,000.00/each = $6,000.00*
2-1/2 TON UNITS
- ---------------
Model Number Serial Number G.O. Item # Open/Boxed
- ------------ ------------- ----------- ----------
CCWO30AMTE 7UJ2836304** 923585040 Open and
missing
transformer
" 7UJ2837104 " Boxed
" 7UJ2836504 " Boxed
" 7UJ2837204 " Boxed
" 7UJ2837504 " Boxed
" 7UJ2838204 " Boxed
" 7UJ2835204 " Boxed
" 7UJ2835504 " Boxed
" 7UJ2836204 " Boxed
" 7UJ2836404 " Boxed
" 7UJ2836304 " Boxed
" 7UJ2838804 " Boxed
" 7UJ2838304 " Boxed
" 7UJ2838904 " Boxed
" 7UJ2838104 " Boxed
" 7UJ2838704 " Boxed
" 7UJ2837904 " Boxed
" 7UJ2835604 " Boxed
" 7UJ2839104 " Boxed
Total Units: 18 boxed value at $2,330.00 = $41,940.00*
Note: Defective unit not included
<PAGE>
EXHIBIT "B" (Page 2 of 2)
LibertyView Building
457 Haddonfield Road
Cherry Hill, NJ 08002 Items Not Included in Sale of Property
- -------------------------------------------------------------------------------
I - MCQUAY HEAT PUMP INVENTORY (Continued)
- ----------------------------------
2-TON UNITS
- -----------
Model Number Serial Number G.O. Item # Open/Boxed
- ------------ ------------- ----------- ----------
CCWO24AMTE 7UJ2835104 923585030 Boxed
" 7UJ2832404 " Boxed
" 7UJ2832904 " Boxed
" 7UJ2831904 " Boxed
" 7UJ2832104 " Boxed
" 7UJ2834004 " Boxed
" 7UJ2832204 " Boxed
Total Units: 7 valued at $2,228.00 = $15,596.00*
- -------------------------------------------------------------------------------
GRAND TOTAL VALUE OF ALL UNITS: $63,536.00
NOTES
- -----
* Prices quoted by Mr. DiMartino-Fluidics - 7/26/94 (includes valves and
thermostats, but not boilerless kits. Unboxed units may need some minor
parts)
** HIP has expressed an interest in purchasing some of these units and I
have already supplied them with a listing of the inventory.
II- JANITORIAL SUPPLIES/EQUIPMENT
- ----------------------------------
Paper towels, toilet tissue, Lysol, feminine hygiene products, air
freshners, trash bags
Vacuum Cleaners
Floor Scrubber
Floor Buffer
III- OFFICE EQUIPMENT
- ---------------------
Macintosh Powerbook 180 Laptop Computer
Texas Instruments T-5032 Calculator
AT&T 705 Lobby Desk Phone
Xerox Combination FAX Machine/Copier with table
One two-drawer wood lateral file cabinet
Stapler, 3-hole punch, desk lamp
Pens/Pencils
<PAGE>
EXHIBIT "C"
Permitted Exceptions
This policy does not insure against loss or damage (and the Company will not
play costs, attorneys' fees or expenses) which arise by reason of:
4. Slope, grading and drainage rights affecting that part of premises
bounding or abutting Chapel Avenue and as contained in Deed Book 3963, page
158 and Deed Book 4001, page 96.
<PAGE>
EXHIBIT "C"
Permitted Exception
This policy does not insure against loss or damage (and the Company will not
play costs, attorneys' fees or expenses) which arise by reason of:
REMOVED recorded easements, discrepancies or conflicts in boundary lines,
shortage in area and encroachments which an accurate and complete survey would
disclose.
REMOVE filed mechanics' or materialmen's liens.
2. Utility Easement and Right of Way as contained in Deed Book 349, page 292.
3. Slope, drainage and grading rights as contained in Deed Book 2061, page 524
and Deed Book 2171, page 479.
4. Right of Way Grant as contained in Deed Book 4341, page 8.
<PAGE>
EXHIBIT "D"
RENT ROLL-LibertyView of Cherry Hill (as of 3/18/96)
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
Rentable Lease Term
Suite S.F. Per Annual Free Rent Rent
# Tenant Rent Per Sq. Ft. Lease Rent (Months) Start End Start
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Existing Tenants
400 Amwest Surety 2/1/94-1/31/98 $15.34 2,294 $ 35,190 5 2/1/92 1/31/00 7/1/92
2/1/98-1/31/00 $16.34
+ +
10/20/95-1/31/98 $17.00 549 9,333 10/20/95 1/31/00
------- ----------
2/1/98-1/31/00 $18.00 2,843 44,523 Tenant has right of Early Termination after
1/13/98 with 6 mos. prior notice with
penalty per formula in lease.
410 Arthur Anderson LLP $18.00 2,457 44,226 3 (incl. last 12/1/95 2/28/01 2/1/96
month of Tenant has right of Early
lease) Termination after 11/30/98 with
6 mos. prior notice with
penalty per formula in lease.
230 Commonwealth Title $19.05 2,998 57,112 6 2/2/91 8/1/96 8/1/91
Insurance Co.
100 First Fidelity Bank, $14.63 7,233 105,840 0 1/1/90 12/31/99 1/1/90
N.A.
500 Pepper Hamilton $18.25 4,306 78,585 0 3/18/96 3/31/01 3/18/96
& Scheetz Tenant has right of Early
Termination after 36, 42, 48
months with 6 mos. prior
notice with penalty
per formula in lease.
200 HIP Health Plan of NJ 1/1/93-12/31/97 $12.32 31,713 390,704 0 1/1/93 1/1/08 1/1/93
& 300 1/1/98-12/31/02 $14.32
1/1/03-12/31/07 $16.32
or 90% of FMV
+ + + +
HIP Health Plan of NJ Coincide with 5,802 71,481 0 7/15/94 1/1/08 7/15/94
2nd Floor. Expansion original lease ------- ----------
37,515 462,185
510 Klehr Harrison 12/1/95-5/31/97 $18.50 8,912 164,872 6 5/15/95 5/31/02 12/1/95
6/1/97-5/31/02 $19.00 Tenant has right of Early
Termination after 5/31/00 with
9 mos. prior notice with
penalty payment of $145,000.
N/A Bell Atlantic NYNEX N/A N/A 24,000 0 3/1/96 2/28/01 3/1/96
420 Shapiro & Kreisman $16.03 8,033 128,769 3 6/30/02 9/30/97 9/30/92
+ + + +
Shapiro & Kreisman $16.03 3,488 55,913 0 9/10/93 9/30/97 9/10/93
------- ----------
11,521 184,662
520 SleepCare 9/1/95-8/31/00 $18.50 2,955 54,668 0 9/1/95 8/31/00 9/1/95
------- ----------
SUBTOTAL-Existing 80,740 1,220,693
------- ----------
Vacant/Raw Space 40,265
Adjustment Difference 732
------- ----------
TOTAL 121,737 $1,220,693
======= ==========
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------
%
Suite Share Renewal Security
# Tenant Sq Ft/121,737 Options Reimbursement Deposit
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Existing Tenants
400 Amwest Surety 2.335% None NNN $ 2,834.00
410 Arthur Anderson LLP 2.020% Three months Full Service --
@ same rent then plus Electric
One 5 Year Term
@ FMV
230 Commonwealth Title 2.463% One 5 Year Term NNN --
Insurance Co. @ FMV
100 First Fidelity Bank, 5.941% One 5 Year Term NNN --
N.A. @ CPI
500 Pepper Hamilton 3.537% Two 5 Year Terms Full Service --
& Scheetz @ FMV plus Electric
200 HIP Health Plan of NJ 26.050% Three 5 Year NNN 32,558.68
& 300 Terms @ 95% of Except Janitorial
FMV
+
HIP Health Plan of NJ -- -- -- --
2nd Floor. Expansion
510 Klehr Harrison 7.32% One 5 Year Term Full Service 13,739.33
@ $22.00 plus Electric To be ret'd. to
Tenant after
11/15/96
N/A Bell Atlantic NYNEX N/A
420 Shapiro & Kreisman 9.464% Two 5 Year Terms NNN --
+ @ FMV
Shapiro & Kreisman
520 SleepCare 2.427% One 5 Year Term NNN --
------ @ FMV
SUBTOTAL-Existing 66.323%
------
Vacant/Raw Space 33.075%
Adjustment Difference 0.601%
------ ----------
TOTAL 100% $49,132.01
====== ==========
</TABLE>
Note: No commission payable except under Apex Agreement relating to
Bell Atlantic NYNEX Lease.
<PAGE>
EXHIBIT "E"
Service Contracts
<PAGE>
<TABLE>
<CAPTION>
LibertyView Building, 457 Haddonfield Road, Cherry Hill, NJ 08002 Maintenance Contract Listing
- -------------------------------------------------------------------------------------------------------------------------------
Termination
Contract Period Automatic Renewal Notice Date Company & Service
- --------------- ----------------- ----------- -----------------
<S> <C> <C> <C>
04/01/95-03/31/96 1 Year 30 days written Arc Water Treatment Co.
(by 2/29/96) HVAC water treatment
Notes: Contract not yet renewed, but not
cancelled either. Proposed cost for period
4/l/96-3/31/97 would be $2,052.00/year,
payable monthly.
04/01/96-11/30/96 None N/A The Brickman Group, Ltd
Exterior Landscaping
Notes: Annual Cost: $11,800 payable in 10
equal pmts. during period 2/1 - 10/1/96
Contract renewed 1/16/96. No specific
language re termination.
02/08/96-02/08/97 1 year 30 day Grinnell Fire Protection
at current cost termination Annual inspection of sprinkler
notice system and fire pump
(by 1/8/97) Notes: Inspection performed June of
each year. Annual Cost $1,120.00
Contract renewed 01/10/96
03/01/94-02/28/97 3 Years 90 days written Longview Waste Systems
(by 12/1/96) Trash Dumpster 5X Week Service
Notes: Annual Cost $11,709.96, payable
monthly
Contract signed 3/l/94
04/01/96-03/3l/97 No N/A Assn. Retarded Citizens
Litter Pickup
Notes: 2X month at cost of $150/month
No specific provision for contract
termination. Contract renewed on 3/12/96.
<PAGE>
LibertyView Building, 457 Haddonfield Road, Cherry Hill, NJ 08002 Maintenance Contract Listing
- -------------------------------------------------------------------------------------------------------------------------------
Termination
Contract Period Automatic Renewal Notice Date Company & Service
- --------------- ----------------- ----------- -----------------
04/01/96-03/3l/97 6 Months 30 days written Onan-Cummins Power Systems
(by 2/28/97) Maintenance Agt. for Emergency
Generator - 2X year
Notes: Annual cost - $932.80
Inspections May/November each year
04/01/96-03/31/97 1 Year Renews 1 yr. PM Co., Inc.
Automatic unless 30 day Parking Lot Sweeping - 1X/Month
termination Notes: Annual Cost $1,208.40, payable
notice given monthly. Contract renewed 1/22/96
(by 2/28/97)
04/01/96-03/31/97 1 Year 30 days written Universal Pest Controls, Inc.
(by 2/28/97) Exterminator Service 1X/Month
Notes: Annual Cost: $540, payable monthly
Contract renewed 1/25/96, but can be
cancelled on 30 day notice
05/01/96-04/30/97 No 30 days written Thermal Products
(by 3/31/97) HVAC/Domestic Water Pump Maintenance
Contract. 4X Year Normal Maintenance
Annual Cost - $6,412/year, Contract
renewed 3/25/96. No specific language re
contract termination in event of new owner
06/01/94-05/3l/97 3 Years 90 days written Independence Communication
(by 2/28/97) Muzak in Lobby (equipment/tapes)
Notes: Annual Cost $1,081.20, payable
monthly. Contract signed 5/2/94. Prior
consent of Vendor required to transfer
contract
<PAGE>
LibertyView Building, 457 Haddonfield Road, Cherry Hill, NJ 08002 Maintenance Contract Listing
- -------------------------------------------------------------------------------------------------------------------------------
Termination
Contract Period Automatic Renewal Notice Date Company & Service
- --------------- ----------------- ----------- -----------------
06/16/96-06/16/97 No N/A G.S. Edwards Co.
Annual inspection of fire panel/pull
stations/smoke detectors.
Notes: Landlord reqd. to hire lift chair.
(Does not include HIP equipment)
Annual Cost - $565.00
Contract renewed 3/14/96.
04/14/96-04/13/98 No 30 days written Amtech
(by 3/14/98) Elevator Maintenance 2X/month
Notes: Annual Cost - $9.025.00, payable
monthly. Contract renewed 3/18/96
07/03/95-07/02/98 1 Year 30 days written Robinson Alarm Company
(by 06/01/98) Sprinkler/Fire Panel Monitoring
Notes: Annual Cost $360, payable
quarterly. Contract signed 4/27/95.
Consent of vendor reqd. to transfer
contract.
03/08/94-03/01/99 1 Year 30 days written Security Link (formerly Nat'l Guardian)
(by 1/29/99) Elevator Phone monitoring
Notes: Annual Cost $267.12 payable qtrly.
Penalty for contract termination.
By: Terry Cassidy - 3/28/96
</TABLE>
<PAGE>
Exhibit 99.2 First Amendment to Purchase
and Sale Agreement
between UM and the Trust
FIRST AMENDMENT TO PURCHASE AND SALE AGREEMENT
This First Amendment made this 30th day of May, 1996, by and between UM
REAL ESTATE INVESTMENT COMPANY, LLC ("Seller") and BRANDYWINE REALTY TRUST
("Buyer").
Background
Seller and Buyer are parties to that certain Purchase and Sale
Agreement made as of the 28th day of March, 1996 (the "Agreement") with respect
to the sale of property known as Block 176.01, Lots 1, 2 and 3 on the official
tax map of the Township of Cherry Hill together with all improvements thereon
(the "Property").
Buyer has requested that Seller extend the Closing Date and, to the
extent provided herein, the Due Diligence Period, and Seller has agreed to do so
pursuant to the terms and conditions hereafter set forth.
NOW, THEREFORE, Buyer and Seller, for and in consideration of the
mutual covenants contained herein and other good and valuable consideration, the
receipt of which is hereby acknowledged, intending to be legally bound, do
hereby agree that notwithstanding anything to the contrary contained in the
Agreement:
1. Definitions. All defined terms herein shall have the meaning
ascribed to them under the Agreement unless specifically provided herein to the
contrary.
2. Deposit. (a) Article 2.1(a) is amended by adding thereto the
following:
In the event Closing does not occur by June 14, 1996, unless due to a
default by Seller or due to Buyer's termination of the Agreement as
permitted under Article 3 of this First Amendment, the Title Company
shall continue to hold the Ninety Thousand Dollars ($90,000) held as
Deposit, such sum to become non-refundable on June 14, 1996 and Buyer
shall concurrently pay to the Title Company by June 14, 1996 by
certified check, bank check or wire transfer, an additional One Hundred
Fifty Thousand Dollars ($150,000) which shall become part of the
Deposit and thereupon, the Deposit shall be non-refundable. Buyer's
failure to pay such additional $150,000 by the above time period to
Seller shall constitute a default under the Agreement. Until 5 p.m. on
June 14, 1996, only $10,000 of the Deposit pursuant to subparagraph (b)
below shall be non-refundable; thereafter, unless Seller defaults
hereunder, the remaining Two Hundred Forty Thousand Dollars ($240,000)
shall become non-refundable.
(b) Ten Thousand Dollars ($10,000) of the Deposit currently held by
the Title Company shall be deemed non-refundable as of this date and
shall be immediately paid by the Title Company to Seller. Seller shall
be entitled to
-1-
<PAGE>
retain such amount in the event Closing does not occur for any reason
(including Buyer's termination of the Agreement as permitted under the
Agreement or this First Amendment) unless Seller defaults under the
Agreement, in which event Seller shall reimburse such $10,000 to Buyer.
In the event Buyer terminates the Agreement as permitted under Article
3 of this First Amendment, the remaining Ninety Thousand Dollars
($90,000) of the Deposit shall be returned by the Title Company to
Buyer if such date is on or before June 14, 1996; however, if Seller
defaults prior to Closing, the entire Deposit, including the additional
$150,000 and interest shall be returned to Buyer.
3. Due Diligence. Article 3 of the Agreement is amended by adding
thereto the following:
Buyer acknowledges that it has completed all of the investigations
which it is entitled to undertake pursuant to Article 3 of the
Agreement with the exception of those specific items set forth on
Schedule 1 attached hereto and made a part hereof (the "Remaining Due
Diligence Items"). Buyer shall, from and after the date hereof, no
longer have the right to terminate the Agreement for any reason other
than (i) Buyer's good faith determination not to proceed based on the
results of one or more of the Remaining Due Diligence Items or (ii)
Buyer's good faith determination that it is unable to obtain
satisfactory financing to acquire the Property. The $50,000 addition to
the Deposit required under Article 2.1(a) of the Agreement must be paid
by Buyer to the Title Company by 5 p.m. E.D.S.T. on May 30, 1996
notwithstanding the failure of Buyer to have completed the Remaining
Due Diligence Items. Such additional $50,000 shall be governed by the
terms of amended Article 2.1. Buyer shall have the right to terminate
this Agreement solely as a result of Buyer's good faith determination
that is not satisfied with the result of one or more of the Remaining
Due Diligence Items or Buyer's good faith determination that it is
unable to obtain satisfactory financing to acquire the Property, by
notice to Seller not later than 5 p.m. on June 14, 1996 following which
(provided Buyer is not then in default hereunder), the Title Company
shall return the remaining $90,000 of the Deposit to Buyer and
thereafter neither party shall have any further rights or obligations
under the Agreement, except for those which by their terms survive
termination of the Agreement. If Buyer does not terminate the Agreement
as permitted under this Article 3 of this First Amendment, the entire
Deposit (e.g., $250,000) shall become non-refundable so long as Seller
does not default hereunder.
4. Closing. Article 4 of the Agreement shall be amended to provide that
Closing shall be held on or before July 19, 1996, at the time and place set
forth in the Agreement.
-2-
<PAGE>
5. Signatures. This First Amendment may be executed in one or more
counterparts, each of which shall be deemed an original and part of one and the
same document. Telefax signatures shall be deemed the equivalent of original
signatures.
Except to the extent specifically set forth herein, the terms and
conditions of the Agreement are hereby ratified and confirmed. In the event of
any conflict between the terms of the Agreement and the terms of this First
Amendment, the terms of this First Amendment shall prevail.
IN WITNESS WHEREOF, the parties hereto have set forth their hands and
seals the day and year first above written.
SELLER:
UM REAL ESTATE INVESTMENT
COMPANY, LLC, a New Jersey limited liability
company
By:
------------------------------------------
Arthur W. Hicks, Jr., Manager
BUYER:
BRANDYWINE REALTY TRUST, a Maryland
real estate investment trust
By: XXXXXXXXXXX
------------------------------------------
50524-3
May 30, 1996
-3-
<PAGE>
Schedule 1
Remaining Due Diligence Items
1. Identification of water pressure problem and cause of the sink hole
on the Property. Remedy and cost allocation satisfactory to Buyer.
2. Finalization and approval of survey by Buyer.
3. Review and approval of ISRA non-applicability letter (Seller to
deliver per Article 15.1 of the Agreement).
4. Review and approval of ISRA No-Further Action Letter regarding the
U.S.T. previously located on the Property.
-4-
<PAGE>
Exhibit 99.3 Second Amendment to Purchase
and Sale Agreement between
UM and the Trust
SECOND AMENDMENT TO PURCHASE AND SALE AGREEMENT
This Second Amendment to Purchase and Sale Agreement is made
this 14th day of June, 1996, by and between UM Real Estate Investment Company,
LLC ("Seller") and Brandywine Realty Trust ("Buyer").
Background
Seller and Buyer are parties to that certain Purchase and Sale
Agreement made as of the 28th day of March, 1996 and that certain First
Amendment to Purchase and Sale Agreement made as of the 30th day of May, 1996
(collectively, the "Agreement") with respect to the sale of property known as
Block 176.01, Lots 1, 2 and 3 on the official tax map of the Township of Cherry
Hill together with all improvements thereon (the "Property").
Buyer has requested that Seller modify certain provisions to
the Agreement and Seller has agreed to do so pursuant to the terms and
conditions hereafter set forth.
NOW, THEREFORE, Buyer and Seller, for and in consideration of
the mutual covenants herein and other good and valuable consideration, the
receipt of which is hereby acknowledged, intending to be legally bound, do
hereby agree that notwithstanding anything to the contrary contained in the
Agreement:
1. Definitions. All defined terms herein shall have the
meaning ascribed to them under the Agreement unless specifically provided herein
to the contrary.
2. Deposit.
a. Article 2.1(a) is amended and revised as follows:
Notwithstanding the terms as stated in the Agreement, Buyer
and Seller hereby acknowledge and agree that Buyer has
delivered to the Title Company the initial One Hundred
Thousand Dollar ($100,000) Deposit and the additional One
Hundred Fifty Thousand Dollar ($150,000) Deposit as required
by the Agreement. Unless (i) Seller defaults, (ii) Seller
fails to address item 1 on Schedule 1 on or before June 28,
1996 in a mutually satisfactory manner or (iii) Bank (as
hereinafter defined) fails to fund at Closing a loan in the
amount of $8,480,000 in accordance with the letters dated June
5, 1996 and June 14, 1996 attached hereto as Exhibit 2(a)
(collectively, the "UJB Letters") through no fault or
affirmative action of Buyer, all of the
<PAGE>
aforesaid Deposit shall be held by the Title Company and is
deemed to be non-refundable as of the date hereof. If either
of events (i) or (ii) set forth herein occurs hereunder, the
entire Deposit shall be refunded to Buyer in accordance with
Section 12.1 of the Agreement. In addition to and not by way
of limitation of the foregoing, if event (ii) occurs
hereunder, Ten Thousand Dollars ($10,000) of the Deposit shall
be deemed to be non-refundable, and, thereafter, the remaining
Two Hundred Forty Thousand Dollars ($240,000) shall be
refunded to Buyer.
3. Due Diligence. Article 3 is amended by adding thereto the
following:
Notwithstanding the terms as stated in the Agreement, Buyer
acknowledges that it has completed all of its investigations
which it is entitled to undertake pursuant to Article 3 of the
Agreement with the exception of that specific item set forth
on Schedule 1 attached hereto and made a part hereof (the
"Remaining Due Diligence Item"). Buyer and Seller further
acknowledge and agree that (a) Buyer has made a good faith
effort to obtain financing to acquire the Property from United
Jersey Bank, Seller's current lender (the "Bank"), (b) Bank
has advised Buyer orally that such UJB Letters have been
approved by its Credit Committee, and (c) Seller will derive a
benefit from Buyer's utilization of the Bank. Buyer shall,
from and after the date hereof, no longer have the right to
terminate the Agreement for any reason other than (i) Buyer's
good faith determination not to proceed based on the results
of the Remaining Due Diligence Item or (ii) Bank's inability
to deliver a formal UJB commitment letter (the "UJB
Commitment") to Buyer on or before June 24, 1996 through no
fault or affirmative action of Buyer. Buyer shall have the
right to terminate the Agreement solely as a result of Buyer's
good faith determination that it is not satisfied with the
result of the Remaining Due Diligence Item on or before June
28, 1996 or if Bank does not deliver the UJB Commitment on or
before June 24, 1996. If Buyer terminates this Agreement for
either of events (i) or (ii) herein and Seller is not in
default hereunder, the Title Company shall disburse the
Deposit as follows: (A) Two Hundred Forty Thousand Dollars
($240,000) to Buyer and (B) Ten Thousand Dollars ($10,000) to
Seller; provided, however, if Seller is in default hereunder,
the aforesaid Ten Thousand Dollars ($10,000) shall be returned
to Buyer; and, provided, further, thereafter, neither party
shall have any further rights or
-2-
<PAGE>
obligations under the Agreement, except for those which by
their terms survive termination of the Agreement. Subject to
the last two sentences of Section 2.1(a) and the condition set
forth in Section 4.2(d)(2) regarding the refundability of the
Deposit, if Buyer does not terminate this Agreement as
permitted under this Article 3 of this Second Amendment, the
entire Deposit (e.g., $250,000) shall be non-refundable.
4. Closing. Section 4.2(d)(2) is hereby amended and restated
as follows:
2. All documents, instruments and assurances required
to be delivered on or before Closing to Buyer shall
have been duly delivered in form, substance and
execution satisfactory to Buyer in its reasonable
discretion, Bank shall fund at Closing the loan in
the amount of $8,480,000 in accordance with the UJB
Letters attached hereto as Exhibit 2(a), and Seller
shall deliver an acceptable ISRA non-applicability
letter for the Property and an acceptable ISRA
No-Further Action Letter regarding the U.S.T.
previously located on the Property. Buyer and Seller
acknowledge and agree that if Buyer affirmatively or
intentionally causes the Bank to fail to fund the
loan at Closing, such funding shall not be a
condition to Closing of this transaction.
5. Additional Conditions to Closing. In addition to the
conditions set forth in the Agreement, Buyer and Seller acknowledge and agree
that as a condition to Closing: (i) the lease by and between Seller and United
Medical or a similar subsidiary for space in the Property shall be terminated
and (ii) United Jersey Bank shall deliver the Release of the Guaranty of John
Aglialoro which Guaranty was executed in connection with the Property.
6. Signatures. This Second Amendment may be executed in one or
more counterparts, each of which shall be deemed an original and part of one and
the same document. Telefax signatures shall be deemed the equivalent of original
signatures.
Except to the extent specifically set forth herein, the terms
and conditions of the Agreement are hereby ratified and confirmed. In the event
of any conflict between the terms of the Agreement and the terms of this Second
Amendment, the terms of this Second Amendment shall prevail.
-3-
<PAGE>
IN WITNESS WHEREOF, the parties hereto have set forth their
hand and seals the day and year first above written.
SELLER: BUYER:
UM REAL ESTATE INVESTMENT BRANDYWINE REALTY TRUST, a
COMPANY, LLC, a New Jersey Maryland real estate
company investment trust
By: Arthur Hicks, Jr. By: Gerard H. Sweeney
------------------------ -------------------------
Arthur Hicks, Jr. Gerard H. Sweeney
Manager President
-4-
<PAGE>
Schedule 1
Remaining Due Diligence Item
1. Identification of water pressure problem and cause of the
sink hole on the Property. Remedy and cost allocation satisfactory to Buyer. The
parties acknowledge and agree that this problem must be remedied to the
reasonable satisfaction of the parties on or before June 28, 1996.
-5-
<PAGE>
UNITED United Jersey Bank
JERSEY BANK 1800 Chapel Avenue West
P.O. Box 5032
Cherry Hill, NJ 08002
609 665-4800
June 14, 1996
Mr. Gerard H. Sweeney
President and CEO
Brandywine Realty Trust
Two Greentree Centre - Suite 200
Marlton, New Jersey 08053
Re: Libertyview Building, Cherry Hill, New Jersey
Dear Gerry:
This letter is to conform that United Jersey Bank's Real Estate Loan Committee
has approved your request for acquisition financing on the Libertyview Building.
The general loan terms approved by the Committee are as stated in the executed
Letter Of Intent dated June 5, 1996 with the exception of (1) Guarantor
Covenants of (a) Stated Net Worth not less than $6.3MM, and (b) FPO pay-out
ratio not greater than 110%, and (2) the prohibition against secondary financing
has been waived, solely as it relates to the $1MM of deferred purchase price.
United Jersey Bank will require review and approval of these subordinate debt
documents prior to closing.
I look forward to working with you on this transaction and please call me at
609-486-4678 if you have any questions.
A commitment letter will be forthcoming shortly.
Sincerely,
/s/ Amy L. Brown
- -----------------------------------
Amy L. Brown
Vice President and Regional Manager
cc: Michael L. Brown, SVP
<PAGE>
UNITED United Jersey Bank
JERSEY BANK 1800 Chapel Avenue West
P.O. Box 5032
Cherry Hill, NJ 08002
609 665-4800
June 5, 1996
Brandywine Realty Trust
Mr. Gerard H. Sweeney
President and CEO
Two Greentree Centre - Suite 100
Marlton, New Jersey 08053
Re: Libertyview Building, Cherry Hill, New Jersey
Dear Gerard:
This letter will acknowledge that you have submitted a loan request to United
Jersey Bank (UJB) for the above referenced project on the following terms and
conditions:
Borrower: A single asset LLC, to be established.
Ownership: 100% by Brandywine Realty Trust.
Loan Amount: $9,777,140 as follows:
"Permanent Loan" : $8,480,000 - via the Borrower's assumption of
UJB's existing first mortgage with UM Real Estate Investment
Corporation (UM). Such mortgage to be modified and increased by
approximately $1,180,000 (existing mortgage balance of
approximately $7.3 million).
"Earnout Loan": $1,297,140 - These funds are to be used
exclusively for tenant fit-out and leasing commission costs for
the 40,782 square feet of currently vacant space. The loan will
be funded as follows:
(a) maximum of $30 per square foot for tenant fit-out costs on
the vacant space located on floors 6 and 7, totaling 35,417
square feet.
(b) maximum of $15 per square foot for tenant fit-out costs on
the remaining vacant square feet, totaling 5,365 square
feet.
(c) market leasing commissions for the total 40,782 square feet
currently vacant, not to exceed $3.78 per square foot.
(d) base rent on these new leases is to be in an amount not less
than $18 per square foot, full service, plus electric.
(e) all new leases are subject to bank approval and are to be
executed on a bank approved standard lease form.
Guarantor: Brandywine Realty Trust will guarantee $3 million of the loan. In
addition, the Trust will guarantee lien free completion of the
improvements.
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Maturity Date: 1/1/99 (the current maturity date
of UJB's existing mortgage with UM)
Interest Rate: "Permanent Loan": 8% fixed (current interest rate in
UJB's existing mortgage with UM).
Principal and Interest payable
monthly as billed.
"Earnout Loan": Floating at one hundred basis
points above UJB's Prime Rate
Prepayment Penalty: 1% prepayment penalty on the
"Permanent Loan" (the current
prepayment penalty in UJB's
existing mortgage with UM). There
will be no prepayment penalty on
the "Earnout Loan".
Fees: $100,000; payable at loan closing
Amortization: "Permanent Loan": 22.5 years (the approximate
remaining amortization in UJB's
existing mortgage with UM)
"Earnout Loan": None
Security: (a) Title insured first mortgage lien on the subject property
consisting of the land and improvements built thereon,
located at 457 Haddonfield Road, Cherry Hill, Camden
County, New Jersey (Block 176.01, Lot l).
(b) Title insured first mortgage lien on the approximately 3/4
acre land parcel located at 1700 Chapel Avenue, Cherry
Hill, Camden County, New Jersey (BLock 176.01 Lots 2 & 3).
(c) Assignment of all leases and rents presently in effect or
hereafter executed.
Conditions: 1) Subject to Bank review and approval of a Phase I
environmental report.
2) Subject to Bank review and approval of a satisfactory
appraisal. Value not to exceed 80% on as "As Is" basis
and 75% on an "As Stabilized" basis.
3) Subject to Bank review and approval of an engineering
report on the subject property.
4) Quarterly audited financial statements of the Guarantor
and annual financial statements of the Borrower. Annual
tax returns for both the Borrower and the Guarantor.
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5) Any monies advanced under the "Earnout Loan" shall be
subject to a satisfactory inspection by a bank engineer.
Such inspection costs to be borne by the Borrower.
6) All costs of the transaction, e.g. appraisal engineering,
environmental, title and legal are to be paid by the
Borrower.
7) No secondary financing permitted.
8) The loan is not assumable.
If you desire to apply for a loan on substantially the same terms and conditions
as set forth above, please indicate so below and return this letter together
with a good faith deposit of $20,000 within ten days of the date hereof. Upon
receipt of the executed letter and good faith deposit within the time frame
specified above, we will undertake formal consideration of the proposed loan
and, if otherwise satisfactory, submit same to our loan committee and/or Board
of Directors for their consideration.
If your loan is approved, we will issue a formal commitment letter which will
set forth the terms and conditions under which the Bank will be prepared to make
the loan. If the principal business terms and conditions of the commitment are
substantially the same as the terms and conditions outlined herein, the good
faith deposit will be considered earned and will be credited towards the balance
of the commitmemt fee. If the principal business terms and conditions of our
commitment letter are not substantially the same, and you do not accept the
commitment, or if we choose not to accept the commitment for any reason, we will
return the good faith deposit less any expenses incurred by the Bank to third
parties. If the Bank declines the loan for any reason whatsoever, it shall have
no liability except for the return of the good faith deposit under the
circumstances set forth above.
If you have any questions regarding the above, please feel free to call me at
609-486-3678. Thank you for this opportunity and we look forward to our growing
business relationship.
Sincerely,
/s/ Amy L. Brown
- --------------------------------------
Amy L. Brown
Vice President and Regional Manager
CC: Michael L. Brown, SVP
APPROVED AND ACCEPTED THIS 7TH DAY OF JUNE, 1996
By: Gerard H. Sweeney
---------------------------------------
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Exhibit 99.4 Third Amendment to
Purchase and Sale Agreement
between UM and the Trust.
THIRD AMENDMENT TO PURCHASE AND SALE AGREEMENT
This Third Amendment to Purchase and Sale Agreement is made
this 24th day of June, 1996, by and between UM Real Estate Investment Company,
LLC ("Seller") and Brandywine Realty Trust ("Buyer").
Background
Seller and Buyer are parties to that certain Purchase and Sale
Agreement made as of the 28th day of March, 1996, that certain First Amendment
to Purchase and Sale Agreement made as of the 30th day of May, 1996 and that
certain Second Amendment to Agreement of Sale dated June 14, 1996 (collectively,
the "Agreement") with respect to the sale of property known as Block 176.01,
Lots 1, 2 and 3 on the official tax map of the Township of Cherry Hill together
with all improvements thereon (the "Property").
Buyer has requested that Seller modify certain provisions to
the Agreement and Seller has agreed to do so pursuant to the terms and
conditions hereafter set forth.
NOW, THEREFORE, Buyer and Seller, for and in consideration of
the mutual covenants herein and other good and valuable consideration, the
receipt of which is hereby acknowledged, intending to be legally bound, do
hereby agree that notwithstanding anything to the contrary contained in the
Agreement:
1. Definitions. All defined terms herein shall have the
meaning ascribed to them under the Agreement unless specifically provided herein
to the contrary.
2. Deposit. Article 2 is amended by revising the "June 28,
1996" date set forth therein to "June 25, 1996".
3. Due Diligence. Article 3 is amended by revising the "June
24, 1996" date and the "June 28, 1996" set forth therein to "June 25, 1996." The
parties acknowledge and agree that Buyer shall have until 5:00 p.m. on June 25,
1996 to exercise its right to terminate the Agreement for either of (i) its non
receipt of the UJB Commitment or (ii) the Remaining Due Diligence Item.
4. Signatures. This Third Amendment may be executed in one or
more counterparts, each of which shall be deemed an original and part of one and
the same document. Telefax signatures shall be deemed the equivalent of original
signatures.
Except to the extent specifically set forth herein, the terms
and conditions of the Agreement are hereby ratified and confirmed. In the event
of any conflict between the terms of the
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Agreement and the terms of this Third Amendment, the terms of this Third
Amendment shall prevail.
IN WITNESS WHEREOF, the parties hereto have set forth their
hand and seals the day and year first above written.
SELLER: BUYER:
UM REAL ESTATE INVESTMENT BRANDYWINE REALTY TRUST, a
COMPANY, LLC, a New Jersey Maryland real estate
company investment trust
By: /s/ Arthur Hicks, Jr. By: /s/ Gerard H. Sweeney
------------------------- ----------------------------
Arthur Hicks, Jr. Gerard H. Sweeney
Manager President
-2-
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Exhibit 99.5 Promissory Note in the
principal amount of $1,000,000
from the Trust to UM
NOTE
AMOUNT: $1,000,000 Haddonfield, New Jersey
July 19, 1996
FOR VALUE RECEIVED, BRANDYWINE REALTY TRUST, a Maryland real estate
investment trust, whose address is Two Greentree Center, Suite 100, Marlton, New
Jersey 08053 ("Maker"), hereby promises to pay to the order of UM REAL ESTATE
INVESTMENT COMPANY, LLC, a New Jersey limited liability company, with offices at
56 Haddon Avenue, Haddonfield, New Jersey 08033 ("Payee"), the principal sum of
ONE MILLION DOLLARS ($1,000,000) (the "Loan"), together with interest on the
outstanding balance thereof at the per annum rate hereafter set forth.
1. Principal and interest, if any, shall be payable at the aforesaid
office of Payee, or such other place as the holder of this Note may designate,
in the following manner:
(a) Except as otherwise provided for in the Event of Default, the
Note will not bear interest during the term hereof.
(b) Maker shall make six (6) payments of principal as follows,
unless Payee shall demand immediate payment in accordance with the terms of this
Note:
July 31, 1997 $100,000
August 31, 1997 $100,000
September 30, 1997 $100,000
October 31, 1997 $100,000
November 30, 1997 $100,000
December 31, 1997 $500,000
(c) The entire unpaid principal together with accrued but unpaid
interest thereon and all other sums due under this Note are due on December 31,
1997 (the "Maturity Date") which date is of the essence. THIS NOTE IS PAYABLE IN
FULL AT THE MATURITY DATE. PAYEE IS UNDER NO OBLIGATION TO REFINANCE THE LOAN OR
EXTEND THE TIME FOR PAYMENT AT THAT TIME.
2. The obligation secured hereby may be prepaid in full or in part, at
any time, without penalty.
3. All payments, including any prepayment, shall be in lawful money of
the United States of America in immediately available funds and shall be applied
first to unpaid, earned fees, then to delinquent escrows, then to accrued
interest, and lastly, to principal outstanding.
4. This Note is secured by (1) a subordinated (second) Mortgage and
Security Agreement of even date herewith (the "Mortgage"), covering certain land
and premises located at the corner of Haddonfield Road and Chapel Avenue, Cherry
Hill Township, Camden County, New Jersey, as more particularly described in the
Mortgage (together, the "Mortgaged Property"), (2) a second priority security
interest in certain personal property located upon the Mortgaged Property and
other collateral described in UCC-1 Financing Statements; and (3) a subordinated
collateral assignment of rents and leases arising out of the Mortgaged Property.
Any failure by Maker to comply with the terms, covenants or conditions of the
foregoing documents or any other document executed by Maker in connection with
the Loan (collectively, the "Loan Documents") shall, upon the elapsing of any
applicable notice and/or grace period, without cure, automatically constitute an
Event of Default under this Note, and all of the provisions contained in the
Loan Documents by Maker to Payee to secure the indebtedness set forth herein are
hereby incorporated by this reference thereto as if the same were set forth
herein in detail.
5. The occurrence of one or more of the following, after the expiration
of all applicable notice and cure periods, if any, (an "Event of Default"), at
the option of Payee, shall constitute a default by Maker under this Note:
(a) If Maker shall fail to make any payment when it is due (provided
that Payee agrees not more than once during any twelve (12) month period during
the term of this Note to give Maker notice of such failure, and allow Maker five
(5) days after the giving of such notice to cure such failure, prior to same
being an Event of Default);
(b) If any certification, warranty, or representation made or
hereafter made by Maker to Payee should prove to be false, incorrect, incomplete
or misleading; and/or
(c) An Event of Default shall occur under the Mortgage and/or any of
the other Loan Documents.
Upon the occurrence of an Event of Default, subject to a certain
Subordination Agreement of even date herewith between Payee and Summit Bank,
Payee may, at its option, declare the entire unpaid
1
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principal balance of this Note together with interest accrued thereon and all
other sums due or owed by Maker hereunder, or under any of the other Loan
Documents, to be due and payable immediately, together with reasonable fees for
legal counsel and for collection, all of which sums shall bear interest
(effective upon such Event of Default) at the rate which is four (4.0%) percent
above the domestic "Prime Rate" as published in the Wall Street Journal from
time to time under the heading "Money Rates", and payment of the same may be
enforced and recovered by the entry of judgment of this Note and the issuance of
execution thereon.
If any payment due hereunder shall be delinquent for more than ten
(10) days after such payment is due and payable, Maker shall pay to Payee a late
charge equal to five percent (5%) of such installment. The right to require a
late charge is in addition to and not by way of limitation of any other rights
and remedies which Payee may have.
6. The remedies of Payee provided herein and in the Mortgage and all of
the other Loan Documents shall be cumulative and concurrent, and may be pursued
singly, successively and together at the sole discretion of Payee, and may be
exercised as often as occasion therefor shall occur; and the failure to exercise
any such right or remedy shall in no event be construed as a waiver or release
of the same.
7. Maker (and all endorsers, sureties and guarantors) waives
presentment for payment, demand, notice of demand, notice of nonpayment or
dishonor, protest and notice of protest of this Note. Liability hereunder shall
be unconditional and shall not be affected in any manner by any indulgence,
extension of time, renewal, waiver or modification granted or consented to by
Payee, unless same is in writing and signed by an authorized officer of Payee.
8. It is the intention of the Maker and Payee to conform strictly to
the usury laws from time to time in force, and all agreements between Maker and
Payee, whether now existing or hereafter arising and whether oral or written,
are hereby expressly limited so that in no contingency or event whatsoever,
whether by acceleration of maturity hereof or otherwise, shall the amount paid
or agreed to be paid to Payee or the holder hereof, or collected by Payee or
such holder, for the use, forbearance or detention of the money to be loaned
hereunder or otherwise, or for the payment or performance of any covenant or
obligation contained herein or in the Mortgage and Security Agreement or any of
the other Loan Documents, or in any other document evidencing, securing or
pertaining to the indebtedness evidenced hereby, exceed the maximum amount
permissible under applicable usury laws. If under any circumstances whatsoever
fulfillment of any provision hereof or of the Mortgage or any of the other Loan
Documents, at the time performance of such provision shall be due, shall involve
transcending the limit of validity prescribed by law, then ipso facto, the
obligation to be fulfilled shall be reduced to the limit of such validity; and
if under any circumstances Payee or any other holder hereof shall ever receive
an amount deemed interest, by applicable law, which would exceed the highest
lawful rate, such amount that would be excessive interest under applicable usury
laws shall be applied to the reduction of the principal amount owing hereunder
or to other indebtedness secured by the Mortgage and not to the payment of
interest, or if such excessive interest exceeds the unpaid balance of principal
and other indebtedness, the excess shall be deemed to have been a payment made
by mistake and shall be refunded to Maker or to any other person making such
payment on Maker's behalf. All sums paid or agreed to be paid to the holder
hereof for the use, forbearance or detention of the indebtedness of Maker
evidenced hereby, outstanding from time to time shall, to the extent permitted
by applicable law, be amortized, pro-rated, allocated and spread from the date
of disbursement of the proceeds of this Note until payment in full of such
indebtedness so that the actual rate of interest on account of such indebtedness
is uniform through the term hereof. The terms and provisions of this paragraph
shall control and supersede every other provision of all agreements between
Payee and Maker and any endorser or guarantor of this Note.
10. Except as hereinafter set forth, Maker shall not have any personal
liability for the payment or performance of any obligations hereunder and in the
event of a default hereof, Payee will look solely to the Mortgaged Property and
the rents, issues and profits thereof and any other collateral specifically
pledged, assigned or granted by Maker as security herefor, and any judgment
obtained against Maker shall so note by its terms or as otherwise permissible by
law. Notwithstanding the foregoing, in the event of a default under this Note,
this obligation shall be recourse to the Maker in an amount which is the
difference between $3,000,000 and that portion of the recourse obligation from
Maker to Summit Bank (pursuant to a Promissory Note in an amount not to exceed
$9,777,240 of even date herewith (the "Summit Note")) which is not credited by
Summit Bank under the Summit Note upon an event of default (as defined under the
Summit Note) by Maker under the Summit Note (e.g., if Summit Bank utilizes
$2,000,000 of the recourse amount as a portion of or as all of its remedy under
the Summit Note, as the case may be, after an event of default under the Summit
Note, this Note to Payee shall be recourse in the amount of $1,000,000). In no
event, however, shall (i) this obligation be recourse to the Maker in an amount
greater than the total amount owing by Maker under this Note, nor (ii) the total
recourse to Maker pursuant to this Note and the Summit Note exceed $3,000,000.
11. This Note and the performance of Maker's obligations hereunder
shall be governed by the laws of the State of New Jersey.
12. The words "Payee" and "Maker" whenever occurring herein shall be
deemed and construed to include the respective successors and assigns of Payee
and Maker.
13. THE PARTIES HEREBY IRREVOCABLY AND UNCONDITIONALLY AGREE THAT ANY
SUIT, ACTION OF OTHER LEGAL PROCEEDING ARISING OUT OR IN CONNECTION WITH THIS
NOTE SHALL BE BROUGHT IN THE COURTS OF RECORD OF THE STATE OF NEW JERSEY OR THE
COURTS OF THE UNITED STATES LOCATED IN THE STATE OF NEW JERSEY. THE PARTIES
CONSENT TO JURISDICTION
2
<PAGE>
OF EACH SUCH COURT IN ANY SUCH SUIT, ACTION OR PROCEEDING, AND WAIVE ANY
OBJECTION TO THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING IN ANY OF SUCH
COURTS.
14. TO THE EXTENT PERMITTED BY LAW, EACH PARTY HEREBY WAIVES ITS RIGHT
TO TRIAL BY JURY IN ANY LITIGATION BETWEEN PAYEE AND MAKER ARISING OUT OF OR IN
CONNECTION WITH THE LOAN AND ANY OF THE DOCUMENTS EVIDENCING THE LOAN OR
EXECUTED IN CONNECTION THEREWITH BY EITHER PARTY. EACH PARTY ACKNOWLEDGES THE
IMPORTANCE OF THIS RIGHT AND MAKES A KNOWING WAIVER THEREOF IN CONSIDERATION OF
THE WILLINGNESS OF MAKER TO MAKE THE LOAN TO PAYEE.
IN WITNESS WHEREOF, Maker has duly executed this Note the day and year
first above mentioned.
WITNESS: BRANDYWINE REALTY TRUST, a Maryland real
estate investment trust
XXXXXXXXXXXXXXXX By: /s/ Gerard H. Sweeney
- ----------------- ----------------------------------
Gerard H. Sweeney, President
3
<PAGE>
Exhibit 99.6 Subordinated Mortgage from the
Trust to UM
MORTGAGE, SECURITY AGREEMENT AND FIXTURE FILING
THIS MORTGAGE, SECURITY AGREEMENT AND FIXTURE FILING (this "Mortgage")
is made the 19th day of July, 1996, between BRANDYWINE REALTY TRUST, a Maryland
real estate investment trust, with offices at Two Greentree Center, Suite 100,
Marlton, New Jersey 08053 ("Mortgagor"), and UM REAL ESTATE INVESTMENT COMPANY,
LLC, a New Jersey limited liability company, with offices at 56 Haddon Avenue,
Haddonfield, New Jersey 08033 ("Mortgagee").
W I T N E S S E T H
THAT Mortgagor has executed and delivered to Mortgagee its Note bearing
even date herewith (the "Note"), wherein Mortgagor promises to pay to Mortgagee
the principal sum of One Million and 00/100 ($1,000,000.00) Dollars, lawful
money of the United States of America, advanced or to be advanced by Mortgagee
to Mortgagor, with interest, if any, thereon, at the rate and times, in the
manner and according to the terms and conditions specified in the Note, all of
which are incorporated herein by reference, such loan transaction being referred
to herein as the "Loan".
NOW, THEREFORE, in consideration of the indebtedness, and as security
for payment to Mortgagee of the principal with interest, and all other sums
provided for in the Note and in this Mortgage, according to their respective
terms and conditions and for performance of the agreements, conditions,
covenants, provisions and stipulations contained herein, Mortgagor does, subject
to the rights of Summit Bank under the Subordination Agreement between Mortgagee
and Summit Bank of even date herewith (the "Subordination Agreement"), hereby
grant, convey, assign and mortgage unto Mortgagee all of its interest in and
agrees that Mortgagee shall have a security interest in, all that, certain
parcel of real estate situate in the Township of Cherry Hill, County of Camden
and State of New Jersey (the "State"), as more particularly described in Exhibit
"A" attached hereto and made a part hereof (the "Land"),
TOGETHER WITH:
(1) Any and all buildings and improvements erected or hereafter erected
thereon;
(2) Any and all fixtures, appliances, machinery and equipment of any
nature whatsoever, and other articles of personal property at any time now or
hereafter installed in, attached to or situated in or upon the Land or the
buildings and improvements to be erected thereon, or used or intended to be used
in connection with the Land, or in the operation of the buildings and
improvements, plant, business or dwelling situate thereon, whether or not the
personal property is or shall be affixed thereto or deemed to be a fixture and
all renewals or replacements thereof or articles in substitution therefor,
including the cash and non-cash proceeds thereof;
(3) All building materials, fixtures, building machinery and building
equipment delivered on site to the Land during the course of, or in connection
with, construction of the buildings and improvements thereon, all of which shall
be deemed to be included within the Mortgaged Property (as hereinafter defined)
immediately upon the delivery thereof to the Mortgaged Property;
(4) Any and all tenements, hereditaments and appurtenances belonging to
the Land or any part thereof or intended so to be in any way appertaining
thereto, and all streets, alleys, passages, ways, water courses and all
easements and covenants now existing or hereafter created for the benefit of
Mortgagor or any subsequent owner or tenant of the Land or any part thereof and
all rights to enforce the maintenance thereof, and all other rights, liberties
and privileges of whatsoever kind or character, and the reversions and
remainders, income, rents, issues and profits arising therefrom, and all the
estate, right, title, interest, property, possession, claim and demand
whatsoever, at law or in equity, of Mortgagor in and to the Land or any part
thereof;
<PAGE>
(5) All leases, contracts of sale and other agreements affecting the
use or occupancy of all or any part of the Land, all deposits paid thereunder
and all rights of Mortgagor to payment thereunder;
(All of the above-mentioned Land, improvements, personal property and
other property and interests are sometimes collectively referred to herein as
the "Mortgaged Property"); and
(6) All of Mortgagor's right, title and interest now or hereafter
acquired by Mortgagor in and to all leases, agreements of sale and other
agreements in connection with all or any part of the Mortgaged Property (but
without any of the obligations thereunder), and the rents, issues and profits
payable therefrom.
TO HAVE AND TO HOLD on a subordinated (second) basis the Mortgaged
Property hereby conveyed or mentioned and intended so to be, unto Mortgagee, to
its own use forever.
PROVIDED ALWAYS, and this instrument is upon the express condition
that, if Mortgagor pays to Mortgagee the principal sum mentioned in the Note,
the interest thereon and all other sums payable by Mortgagor to Mortgagee as are
secured hereby, in accordance with the provisions of the Note and this
1
<PAGE>
Mortgage, at the times and in the manner specified, without deduction, fraud or
delay, and Mortgagor performs and complies with all the agreements, conditions,
covenants, provisions and stipulations contained herein and in the Note and all
of the other documents executed by Mortgagor in connection therewith (together,
the "Loan Documents"), then this Mortgage and the estate hereby granted shall
cease and become void and Mortgagee shall release the same, at the cost and
expense of Mortgagor.
THIS MORTGAGE is a second purchase-money mortgage, subject and
subordinate solely to that certain first mortgage (the "First Mortgage") dated
of even date herewith, in the principal amount of $9,777,140 and given by
Mortgagor in favor of Summit Bank.
MORTGAGOR COVENANTS, subject to the First Mortgage and that certain
Subordination Agreement, among Mortgagor, Mortgagee and Summit Bank dated this
date (the "Subordination Agreement") that until the indebtedness secured hereby
is fully repaid:
1. Seizin and Warranty: Mortgagor warrants that it is indefeasibly
seized of the Mortgaged Property in fee simple, free and clear of all liens and
encumbrances other than those appearing on the marked-up Commitment to Insure
Title issued by Surety Title Corporation under Application No. ST 20505 at the
time of initial closing on the Loan. Mortgagor further warrants that Mortgagor
has full power and lawful right to convey the same in fee simple as aforesaid;
that it shall be lawful for Mortgagee at all times peaceably and quietly to
enter upon, hold, occupy and enjoy the Mortgaged Property and every part
thereof; that all property, fixtures and equipment described herein will be
fully paid for and free from all liens, encumbrances, title retaining contracts
and security interests when delivered and/or installed upon the Mortgaged
Property; that such property, fixture and equipment shall, to the extent
permitted by law, be deemed to be realty and a part of the freehold.
2. Payment and Performance: Mortgagor shall pay to Mortgagee, in
accordance with the terms of the Note and this Mortgage, the principal and
interest, and other sums therein set forth; and shall perform and comply with
all the agreements, conditions, covenants and stipulations of the Note, this
Mortgage and all of the other Loan Documents, the terms of all of which are
incorporated herein by reference.
3. Maintenance of Mortgaged Property: Mortgagor shall abstain from and
shall not permit the commission of waste in or about the Mortgaged Property;
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; shall not permit the Mortgaged Property to become vacant, deserted
or unguarded; and shall maintain the Mortgaged Property in good condition and
repair, reasonable wear and tear excepted and will make or cause to be made, as
and when necessary, all repairs, renewals, replacements, structural and
non-structural, exterior and interior, ordinary and extraordinary, foreseen and
unforseen.
4. Insurance and Condemnation: Mortgagor shall keep the Mortgaged
Property continuously insured against loss or damage by fire, and against such
other hazards as Summit Bank and Mortgagee may reasonably require under an
insurance policy with "broad form" endorsement, issued by Aetna Casualty &
Surety Company, on a non-contributing and non-reporting form basis, for the full
replacement value thereof and including a business interruption policy for a
period of not less than one (1) year. Subject to the First Mortgage, all
policies, including policies for any amounts carried in excess of the required
minimum and policies not specifically required by Mortgagee, shall be maintained
in full force and effect, shall be delivered to Mortgagee, with premiums
prepaid, shall be endorsed with a standard mortgagee clause in favor of
Mortgagee, with Mortgagee and Summit Bank named as loss payee, shall provide for
at least thirty (30) days prior written notice of cancellation, non-renewal or
material amendment to Mortgagee, shall be written by insurance companies having
an A.M. Best Company, Inc. rating of "A" or higher and a financial size category
of not less than XII, or otherwise as approved by Mortgagee. In addition,
Mortgagor shall at all times be protected by comprehensive general public
liability (in an amount of not less than $1,000,000.00 per occurrence), property
damage, and flood (if applicable) insurance policies, and such other insurance
as is, from time to time, carried by most owners of properties similar to the
Mortgaged Property, including, but not limited to, boiler insurance, business
interruption insurance and employer's liability insurance, naming Mortgagee as
an additional insured and containing a waiver of subrogation against Mortgagee.
Such coverages at all times shall be evidenced by current certificates of
<PAGE>
insurance issued to Mortgagee providing for thirty (30) days prior written
notice of cancellation, non-renewal or material amendment of coverage. If the
insurance, or any part thereof, shall expire, be withdrawn, be materially
amended 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, or if for any
reason whatever the insurance shall be unsatisfactory to Mortgagee, Mortgagor
shall immediately place new insurance on the Mortgaged Property, satisfactory to
Summit Bank. All renewal policies, with premiums paid, shall be delivered to
Mortgagee at least thirty (30) days before expiration of the old policies. In
the event of loss, Mortgagor will give prompt notice thereof to Mortgagee, and
Mortgagee and Summit Bank may make proof of loss if not made promptly by
Mortgagor (but shall have no obligation to do so).
Except as may be provided in the First Mortgage, each
insurance company concerned is hereby 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
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Mortgagee, irrevocably, as Mortgagor's attorney-in-fact to endorse any draft
therefor. Mortgagee shall apply any casualty insurance proceeds toward the costs
of reconstruction or restoration of the Mortgaged Property as long as Mortgagor
is not in default, and in such case of a default against the outstanding balance
of the Loan, notwithstanding that the amount owing thereon may not then be due
and payable. If Mortgagee becomes the owner of the Mortgaged Property or any
part thereof by foreclosure or otherwise, such policies, including all right,
title and interest of Mortgagor thereunder, shall become the absolute property
of Mortgagee.
Except as may be provided in the First Mortgage, Mortgagor
hereby assigns to Mortgagee any and all awards heretofore and hereafter made to
the present and all subsequent owners of the Mortgaged Property by any
governmental or other lawful authorities for taking or damaging by eminent
domain the whole or any part of the Mortgaged Property or any easement therein,
including any awards for any changes of grades of streets, which said awards are
hereby assigned to Mortgagee, who is hereby authorized to collect and receive
the proceeds of any such awards from such authorities and to give proper
receipts and acquittances therefor, and to apply the same (after deduction of
attorney's fees and other costs of collecting the funds) toward the payment of
the amount owing on account of this Mortgage and the Note, notwithstanding that
the amount owing thereon may not then be due and payable. Mortgagor hereby
agrees, upon request, to make, execute and deliver any and all assignments and
other instruments sufficient for the purpose of evidencing and effecting such
assignment of the aforesaid awards to Mortgagee. The aforesaid awards are
assigned to Mortgagee free, clear and discharged of any and all encumbrances of
any kind or nature whatsoever. Mortgagor further agrees to give Mortgagee prompt
notice of the actual or threatened commencement of any proceedings in the nature
of eminent domain affecting all or any part of the Mortgaged Property and to
deliver to Mortgagee copies of any papers served upon Mortgagor in connection
with any such proceedings. No settlement for the damages sustained shall be made
by Mortgagor without Mortgagee's prior written approval, which approval shall
not be unreasonably withheld.
If, prior to the receipt by Mortgagee of either such insurance
proceeds or condemnation awards, or both, the Mortgaged Property or any part
thereof shall have been sold on foreclosure of this Mortgage, Mortgagee shall
have the right, whether or not a deficiency judgment on the Note shall have been
sought, recovered or denied, to receive said sums to the extent of the debt
remaining unsatisfied after such sale, with interest thereon at the applicable
rate set forth in the Note, and to receive the reasonable counsel fees, costs
and disbursements incurred by Mortgagee in connection with the collection of
said sums.
In the event of foreclosure of this Mortgage or other transfer
of title to the Mortgaged Property in extinguishment of the Loan, all right,
title and interest of Mortgagor in and to any insurance policies then in force
shall pass to the purchaser or grantee, and Mortgagor hereby appoints Mortgagee
as its attorney-in-fact, in Mortgagor's name, to assign and transfer all such
policies and proceeds to such purchaser or grantee.
Mortgagor may maintain insurance required by means of one or
more blanket insurance policies maintained by Mortgagor; provided, however, that
(A) any such policy shall specify, or Mortgagor shall furnish to Mortgagee a
written statement from the insurer so specifying, the maximum amount of the
total insurance afforded by such blanket policy that is allocated to the
Mortgaged Property and any sublimits in such blanket policy applicable to the
Mortgaged Property, (B) each such blanket policy shall include an endorsement
providing that, in the event of a loss resulting from an insured peril,
insurance proceeds shall be allocated to the Mortgaged Property in an amount
equal to the coverages required to be maintained by Mortgagor as provided above
and (C) the protection afforded under any such blanket policy shall be no less
than that which would have been afforded under a separate policy or policies
relating only to the Mortgaged Property.
<PAGE>
5. Taxes and Other Charges: Mortgagor shall pay when due and payable
and before interest or penalties are due thereon, all taxes, assessments, 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
thereof or against the interest of Mortgagee therein, or which by any present or
future law may have priority over the indebtedness secured hereby either in lien
or in distribution out of the proceeds of any judicial sale; and Mortgagor shall
produce to Mortgagee within ten (10) days of Mortgagee's written request the
official receipt for the payment thereof; provided that, if Mortgagor in good
faith and by appropriate legal action shall contest the validity of any such
item, or the amount thereof, and shall have established on its books a reserve
for the payment thereof in such amount as Mortgagee may 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. Mortgagor covenants that no
owner of the Mortgaged Property shall be entitled to any credit by reason of the
payment of any tax thereon.
6. Installments for Insurance, Taxes and Other Charges: Subject to the
First Mortgage, without limitation of anything else herein contained, Mortgagor,
after an Event of Default, shall pay to Mortgagee monthly at the time when the
monthly installment of principal and/or interest is payable, an amount equal to
one-twelfth (1/12) of the annual premiums not prepaid for the fire and extended
coverage
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<PAGE>
insurance and the annual real estate taxes, water and sewer rents, any special
assessments, charges or claims and any other item which at any time may be or
become a lien upon the Mortgaged Property prior to the lien of this Mortgage;
and on demand from time to time, Mortgagor shall pay to Mortgagee any additional
sums necessary to pay such taxes and other items, all as estimated by Mortgagee;
the amounts so paid shall be security for payment of taxes and said other items
shall be used in payment thereof if Mortgagor is not otherwise in default
hereunder. Mortgagor will produce to Mortgagee, not later than ten (10) days
before the date on which any installment for insurance, taxes, and other charges
shall becomes due and owing, receipts for such installments for insurance,
taxes, and other charges. No amount so paid shall be deemed to be trust funds
and may be commingled with general funds of Mortgagee, and no interest shall be
payable thereon. If, pursuant to any provision of this Mortgage, the whole
amount of the unpaid principal debt becomes due and payable, Mortgagee shall
have the right, at its election, to apply any amount so held, in such order and
in such amounts as Mortgagee may elect, against: (a) any amounts payable by
Mortgagor hereunder or under any of the other Loan Documents, and/or (b) accrued
and unpaid interest, and/or (c) the outstanding principal balance of the Loan.
At Mortgagee's option, Mortgagee from time to time may waive, and after any such
waiver may reinstate, the provisions of this Paragraph 6 requiring the monthly
payments. Mortgagor will furnish to Mortgagee bills and other requests for
payment in sufficient time to enable Mortgagee to pay such taxes, assessments,
levies, charges and fees as provided above.
7. Security Agreement: This Mortgage constitutes a security agreement
under the Uniform Commercial Code as adopted in the State and creates a second
priority security interest in the Mortgaged Property including, without
limitation, all furniture, fixtures, equipment and personal property installed
in, or to be placed upon, or used in connection with, or necessary for, the
operation of the Mortgaged Property, except such personal property owned by
tenants in the Mortgaged Property and such personal property owned by the
contractor or subcontractors performing work on the Mortgaged Property, whether
stored on the Mortgaged Property or elsewhere and used or to be used in
connection with the Mortgaged Property; all leases, rents, issues and profits,
and all inventory, accounts, accounts receivable, contract rights, general
intangibles, chattel paper, instruments, documents, notes, drafts, letters of
credit, insurance policies, insurance and condemnation awards and proceeds,
trade names, trademarks and service marks arising from or related to the
Mortgaged Property and any business conducted thereon by Mortgagor; and all
replacements, additions, accessions and cash and non-cash proceeds and products
thereof. Mortgagor shall execute, deliver, file and refile any financing
statements or other security agreements Mortgagee may require from time to time
to confirm the lien of this Mortgage and the security interest hereby created
with respect to such property, and Mortgagor shall pay any reasonable costs or
fees incurred in connection therewith. Without limiting the foregoing, Mortgagor
hereby irrevocably appoints Mortgagee attorney-in-fact for Mortgagor to execute,
deliver and file such instruments for and on behalf of Mortgagor after notice
and non-delivery for five (5) days. Notwithstanding any release of any or all of
the property included in the Mortgaged Property which is deemed "real property",
any proceedings to foreclose this Mortgage or its satisfaction of record, the
terms hereof shall survive as a security agreement with respect to the security
created hereby and referred to herein until the repayment or satisfaction in
full of the obligations of Mortgagor as are now or hereafter evidenced by the
Note and the other Loan Documents. As to those items of the Mortgaged Property
that are, or are to become, fixtures (together with all products and proceeds
thereof), it is intended that THIS MORTGAGE SHALL BE EFFECTIVE AS A FINANCING
STATEMENT FILED AS A FIXTURE FILING from the date of its filing in the real
estate records of the County where the Mortgaged Property is located. The name
of the record owner of said Mortgaged Property is Mortgagor set forth on page
one of this Mortgage. Information concerning the security interest created by
this Mortgage may be obtained from Mortgagee, as subordinated secured party, at
its address as set forth on page one of this Mortgage. The address of Mortgagor,
as debtor, is as set forth on page one of this Mortgage. This Mortgage covers
goods which are or are to become fixtures.
8. Existence and Taxes: If Mortgagor or any successor or grantee of
Mortgagor is a corporation or partnership, it shall keep in effect its existence
and rights as a corporation or partnership under the laws of the state of its
incorporation or formation and its right to own property and transact business
in the State during the entire time it has any ownership interest in the
Mortgaged Property. For all periods during which title to the Mortgaged Property
or any part thereof shall be held by a corporation or partnership subject to
corporate taxes, partnership taxes or taxes similar to such 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 thereon, all taxes owing by Mortgagor to the United States, to
such state of incorporation or formation and to the State and any political
subdivision thereof, and shall produce to Mortgagee, if requested, receipts
showing payment of any and all such taxes, charges or assessments, all
settlements, notices of deficiency or overassessment and any other notices
pertaining to Mortgagor's tax liability, which may be issued by the United
States, such state of incorporation or formation, or the State and any political
subdivision thereof.
<PAGE>
9. Intentionally Deleted.
10. Compliance with Law and Regulations: Mortgagor shall comply with
all laws, ordinances, regulations, restrictions, requirements and orders of all
federal, state, municipal and other governmental authorities, of courts and of
insurance companies relating to Mortgagor or affecting the Mortgaged Property or
the use and operation thereof. Mortgagor also shall promptly comply with the
provisions of any recorded covenants, conditions or restrictions to which the
Mortgaged Property or any part thereof may at any time
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<PAGE>
be subject. Mortgagor shall not cause or allow the construction or erection of
any public, municipal or utility improvements upon the Mortgaged Property other
than those required by public authorities, without the prior written consent of
Mortgagee, which consent shall not be unreasonably withheld. Mortgagor shall not
drill or extract or enter into any lease for the drilling for or extraction of
oil, gas or other hydrocarbon substances or any mineral of any kind or character
on or from the Mortgaged Property or any part thereof without the prior written
consent of Mortgagee.
11. 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 in such a manner so as not to unreasonably intefere with
Mortgagor's operations.
12. Declaration of No Set-Off: Within fifteen (15) days after requested
to do so by Mortgagee, Mortgagor shall certify to Mortgagee or to any proposed
assignee of this Mortgage, in a writing duly acknowledged, the amount of
principal, interest and other charges then owing on the obligation secured by
this Mortgage and whether there are any set-offs or defenses against it, and if
such set-offs or defenses are asserted, a detailed explanation thereof.
Within fifteen (15) days after requested to do so by Mortgagor,
Mortgagee shall certify to Mortgagor, in a writing duly acknowledged, the amount
of principal, interest and other charges then owing on the obligation secured by
this Mortgage and whether Mortgagor is in default hereunder or under any of the
documents securing the indebtedness evidenced hereby or whether, to the best
knowledge of Mortgagee, any event has occurred which with the giving of notice
or passage of time, or both, would constitute an Event of Default hereunder.
13. Right to Remedy Defaults: In the event that Mortgagor should fail
to pay taxes, assessments, water and sewer charges or other lienable claims
(except in case of contest as aforesaid) or insurance premiums, or fail to make
necessary repairs or permit waste, or otherwise fail to comply with its
obligations hereunder or under the Note or any other document executed in
connection with this Mortgage, then Mortgagee, at its election and upon ten (10)
days prior written notice to Mortgagor, shall have the right to make any payment
or expenditure which Mortgagor should have made, or which Mortgagee reasonably
deems advisable to protect the security of this Mortgage or the Mortgaged
Property, without prejudice to any of Mortgagee's rights or remedies available
hereunder or otherwise, at law or in equity. All such sums, as well as costs,
advanced by Mortgagee pursuant to this Mortgage shall be due within three (3)
days of notice and reasonably detailed explanation thereof from Mortgagor to
Mortgagee, shall be secured hereby, and shall bear interest at the default rate,
if any, provided in the Note, and if none is so provided, then at the prevailing
rate of interest stipulated in the Note, from the date of payment by Mortgagee
until date of repayment.
14. Default:
A. The occurrence of any one or more of the following after
expiration of applicable notice and cure periods, if any, at the option of
Mortgagee, shall constitute a default hereunder:
(1) Failure of Mortgagor to pay any installment of principal or
interest, or any other sum, when it is due under the Note or this Mortgage
(provided that Mortgagee agrees, not more than once during any twelve (12) month
period during the term of this Mortgage to give Mortgagor notice of such failure
and allow five (5) days after the giving of such notice to cure such failure,
prior to same being an Event of Default); or
(2) If any warranty, representation or other statement made by
Mortgagor in this Mortgage or in any other the other Loan Documents is
materially false, incorrect, incomplete or misleading; or
<PAGE>
(3) Mortgagor's non-performance of or noncompliance with any of
the other agreements, conditions, covenants, provisions or stipulations
contained in the Note or in this Mortgage or any of the other Loan Documents
executed in connection with the Loan within thirty (30) days (or such longer
period as may be required, provided Mortgagor commences to cure such
non-performance or non-compliance within such thirty (30) day period and
thereafter proceeds with all due diligence and in good faith to complete such
performance or cure such non-compliance) after having received notice thereof
from Mortgagee; or
(4) If Mortgagor shall make an assignment for the benefit of
creditors, or shall admit in writing its inability to pay its debts as they
become due, or shall file a petition in bankruptcy, or shall be adjudicated a
bankrupt or insolvent, or shall file a petition seeking any relief under any
present or future statute, law or regulation, relating to bankruptcy or
insolvency or shall file an answer admitting or not contesting the material
allegations of a petition filed against it in any such proceeding, or if
Mortgagor shall seek or consent to or acquiesce in the appointment of any
trustee, receiver, custodian, conservator, sequestrator or similar judicial
representative by whatever name of Mortgagor of any material part of its
properties not dismissed within sixty (60) days of such appointment; or
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<PAGE>
(5) If within sixty (60) days after the commencement of any
proceeding against Mortgagor seeking any relief under any present or future
statute, law or regulation relating to bankruptcy or insolvency, such proceeding
shall not have been dismissed, or if, within sixty (60) days after the
appointment without the consent or acquiescence of Mortgagor, of any trustee,
receiver, custodian, conservator, sequestrator or similar judicial
representative by whatever name of Mortgagor or of any material part of its
properties, such appointment shall not have been vacated; or
(6) If a final judgment for the payment of money in excess of
$20,000 shall be rendered against Mortgagor and, within thirty (30) days after
the entry thereof, such judgment shall not have been discharged, bonded-over or
execution thereof stayed pending appeal, or if, within thirty (30) days after
the expiration of any such stay, such judgment shall not have been discharged;
or
(7) If Mortgagor incurs any debt in addition to the debt secured
by this Mortgage and the First Mortgage, which additional debt is secured by all
or any part of the Mortgaged Property without the prior written consent of
Mortgagee; or
(8) If any default shall occur under the terms of the First
Mortgage.
B. Upon the occurrence of any default hereunder, Mortgagee may give
written notice thereof to Mortgagor, and upon receipt of such written notice,
Mortgagor shall have thirty (30) days within which to cure any such default. The
continuance of any default after said notice and the elapsing of thirty (30)
days, without cure, shall be deemed an "Event of Default" hereunder; provided,
however, that if such default is not susceptible of cure within said thirty (30)
day period but is susceptible of cure within a reasonable period of time, then
said cure period shall be extended for a reasonable period of time, so long as
Mortgagor commences its cure within said thirty (30) day period and diligently
prosecutes the same to completion. In the case of the occurrence of a default
under either Subparagraph 14A(1) or 14A(2) above, such shall constitute an
"Event of Default" hereunder without the need for Mortgagee to provide notice
thereof to Mortgagor, anything to the contrary herein notwithstanding.
15. Remedies:
A. Subject to the terms of the First Mortgage and the Subordination
Agreement, if applicable, upon the happening of any Event of Default, the entire
unpaid balance of principal, 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 forthwith, subject to the First Mortgage and the
Subordination Agreement:
(1) Foreclosure: Mortgagee may institute an action of mortgage
foreclosure, 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
herein or elsewhere provided for, as the law may allow, and may proceed therein
to final judgment and execution for the entire unpaid balance of the Loan, with
interest at the rate stipulated in the Note, together with all other sums due by
Mortgagor in accordance with the provisions of the Note and this Mortgage,
including all sums which may have been loaned by Mortgagee to Mortgagor after
the date of this Mortgage, and all sums which may have been advanced by
Mortgagee for taxes, water or sewer rents, other lienable charges or claims,
insurance or repairs or maintenance, and all costs of suit. Mortgagor authorizes
Mortgagee, at Mortgagee's option, to foreclose this Mortgage subject to the
rights of any tenants of the Mortgaged Property; provided, however, that all
leases executed subsequent to the recordation of this Mortgage shall at all
times be subject and subordinate to this Mortgage and to all the terms and
conditions of this Mortgage and to the rights and liens of the holder of this
Mortgage and to all renewals, modifications, consolidations, replacements and
extensions thereof. 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 recover the indebtedness secured hereby or any deficiency remaining
<PAGE>
unpaid after the foreclosure sale of the Mortgaged Property; however, nothing
herein contained shall prevent Mortgagor from disputing in any proceedings the
amount of the deficiency or the sufficiency of any bid at such foreclosure sale
or that the failure to foreclose any such tenants adversely affects the value of
the Mortgaged Property. 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, possess and dispose of the Mortgaged Property in its own
absolute right without further accountability.
(2) Possession: Mortgagee may enter into possession of the
Mortgaged Property, with appropriate legal action, or, in the alternative,
Mortgagee shall be entitled as of right to appointment of a receiver without
regard to the solvency of Mortgagor or any other person liable for the debt
secured hereby, and regardless of whether Mortgagee has an adequate remedy at
law; either Mortgagee or said receiver, as the case may be, may (to the extent
permitted by law) rent the Mortgaged Property, or any part thereof, for such
term or terms and on such other terms and conditions as Mortgagee or such
receiver may see fit, collect all rentals (which terms, "rentals", shall also
include sums payable for use and occupation) and, after deducting all costs of
collection and administration expense, apply the net
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<PAGE>
rentals to the payment of taxes, water, and sewer rents, other lienable charges
and claims, insurance premiums and all other carrying charges, and to the
maintenance, repair or restoration of the Mortgaged Property, or in reduction of
the principal or interest, or both, hereby secured, in such order and amounts as
Mortgagee or said receiver may elect.
(3) Receiver: Mortgagee, without regard to the value or
occupancy of the Mortgaged Property or the solvency of Mortgagor, of all or any
part of the Loan, with or without notice to 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 thereof and apply the 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 reasonable receiver's fees, attorney's fees, costs and agent's
compensation, incurred pursuant to the powers herein 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
thereof, whether by a receiver or otherwise, shall be cumulative to any other
right or remedy hereunder or afforded by law, and may be exercised concurrently
therewith or independently thereof. 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. Subject to the Subordination Agreement, 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, 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 thereafter to bring an action to foreclose
this Mortgage, or any other action, for any default by Mortgagor existing at the
time the earlier action was commenced.
D. The Mortgaged Property, if sold pursuant to any writ or order 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.
E. Subject to the Subordination Agreement, 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 hereunder or be
prejudicial to Mortgagee's interest.
F. Upon request or demand of Mortgagee and following the occurrence
of an Event of Default, subject to the First Mortgage and the Subordination
Agreement, Mortgagor shall, at its expense, assemble the personal property
forming part of the Mortgaged Property and make it available to Mortgagee at a
convenient place acceptable to Mortgagee. Mortgagor shall pay to Mortgagee, on
demand, any and all expenses, including attorneys' fees, incurred or paid by
Mortgagee in protecting its interest in such property and in enforcing its
rights hereunder with respect to such property. Any notice of sale, disposition
or other intended action by Mortgagee with respect to such property sent to
Mortgagor in accordance with the provisions hereof at least five (5) days prior
to such action, shall constitute reasonable notice to Mortgagor. The proceeds of
any disposition of such property, or any part thereof, may be applied by
Mortgagee to the payment of the indebtedness secured hereby in such priority and
proportions as Mortgagee in its discretion shall deem proper.
<PAGE>
G. Subject to the First Mortgage and the Subordination Agreement,
Mortgagee shall have the right in its sole and absolute discretion to apply any
and all amounts received by Mortgagee in the exercise of any of Mortgagee's
rights and/or remedies hereunder or under any of the other Loan Documents, in
such order and in such amounts as Mortgagee may elect, against: (1) any amounts
payable by Mortgagor hereunder or under any of the other Loan Documents, and/or
(2) accrued and unpaid interest and/or (3) the outstanding principal balance of
the Loan.
H. Neither Mortgagor nor any other person now or hereafter
obligated for payment of all or any part of the sums now or hereafter 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 this 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 this Mortgage or the 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
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<PAGE>
make payments according to the terms of any such extension or modification
agreement, unless expressly released and discharged in writing by Mortgagee. No
release of all or any part of the security as aforesaid shall in any way impair
or affect the lien of this Mortgage or its priority over any subordinate lien.
16. Counsel Fees: If Mortgagee becomes a party to any suit or
proceeding affecting the Mortgaged Property or title thereto, the lien created
by this Mortgage or Mortgagee's interest therein (including any proceeding in
the nature of eminent domain), or if following the occurrence of an Event of
Default, Mortgagee engages counsel to collect any of the indebtedness or to
enforce performance of the agreements, conditions, covenants, provisions or
stipulations of this Mortgage, the Note or any of the other Loan Documents,
Mortgagee's costs, expenses and reasonable fees for legal counsel, whether or
not suit is instituted, shall be paid to Mortgagee by Mortgagor, on demand, with
interest at the rate provided in the Note, and until paid they shall be deemed
to be part of the indebtedness evidenced by the Note and secured by this
Mortgage.
17. Notices: All notices permitted or required under this Mortgage
or Note shall be in writing, and shall be sent by certified mail, return receipt
requested, postage prepaid or prepaid nationally recognized overnight carrier
service with receipt required, addressed to the addressee at the address set
forth above, or at such other address as the addressee may hereafter designate
to the other party in writing.
18. Amendment: This Mortgage cannot be changed or amended except by
agreement in writing signed by the party against whom enforcement of the change
is sought.
19. Parties Bound: This Mortgage shall be binding upon and inure to
the benefit of the parties hereto and their respective heirs, personal
representatives, successors and assigns. For purposes of this Mortgage, the
neuter shall include the masculine and feminine, and the singular shall include
the plural and the plural the singular, as the context may require.
20. Interest Rate: Notwithstanding any provision contained in this
Mortgage or in the Note secured hereby, Mortgagor's liability for interest shall
not exceed the limits now imposed by the applicable usury law. If any clause in
the Note, this Mortgage or any of the other Loan Documents requires interest
payments in excess of the highest rate permitted by the applicable usury law,
the clause in question shall be deemed to require such payment at the highest
interest rate allowed by the applicable usury law.
21. Prepayment: The obligation secured hereby may be prepaid in
full or in part at any time without penalty. No sums prepaid may be re-borrowed
or re-advanced.
22. Financial Statements: Mortgagor covenants to furnish to
Mortgagee at any time upon request, Mortgagor's then current Form 1OK/10Q.
Mortgagor also agrees to make its books and accounts relating
to the Mortgaged Property available for inspection by Mortgagee or its
representatives upon request.
Following the occurrence of an Event of Default, Mortgagee
may, at it option, require (1) within ninety (90) days after the close of each
fiscal year of Mortgagor, current, complete, signed, financial statements
prepared in accordance with generally accepted accounting principles by, and
certified by, an independent certified public accountant (and in form and
content satisfactory to Mortgagee) for Mortgagor and each guarantor and/or
surety of the Loan; and (2) within forty-five (45) days of each fiscal quarter,
interim statements compiled by such independent certified public accountant in
accordance with generally accepted accounting principles.
23. No Waiver: Any failure by Mortgagee to insist upon the strict
performance by Mortgagor of any of the terms and provisions hereof shall not be
deemed to be a waiver of any of the terms and provisions hereof, and Mortgagee,
notwithstanding any such failure, shall have the right thereafter to insist upon
the strict performance by Mortgagor of any and all of the terms and provisions
hereof to be performed by Mortgagor. Acceleration of maturity, once claimed
hereunder by Mortgagee, may, at the option of Mortgagee, be rescinded by written
acknowledgment to that effect by Mortgagee, but tender and acceptance of partial
payments alone shall not in any way affect or rescind such acceleration of
maturity.
<PAGE>
24. No Obligation to Marshal Assets: Neither Mortgagor nor the
holder of any mortgage, lien or other encumbrance affecting all or a part of the
Mortgaged Property which is inferior to the lien of this Mortgage shall have any
right to require Mortgagee to apply any amounts received by it to the payment of
any particular principal indebtedness in preference to any other principal
indebtedness secured hereby, and neither Mortgagor nor any such holder shall
have any right to require Mortgagee to marshal assets.
25. Mortgagee Appointed Attorney-in-Fact: Mortgagor hereby
irrevocably appoints Mortgagee as its attorney-in-fact, in its name and stead,
solely to make and execute all conveyances, leases, assignments and transfers of
all or any part of the Mortgaged Property sold pursuant to foreclosure or other
proceedings, and Mortgagor shall join in the execution of any such instrument of
conveyance, assignment or transfer, but such execution by Mortgagor shall not be
necessary in order for such conveyance, lease, assignment or transfer to be
valid and effective in all respects.
8
<PAGE>
26. Compliance with Environmental Requirements: Mortgagor covenants
that:
A. Mortgagor shall operate the Mortgaged Property or cause it to
be operated in compliance with all applicable laws of the state and federal
governments and all applicable rules and regulations promulgated by the New
Jersey Department of Environmental Protection (the "Department") or any
successor agency thereto. Mortgagor shall have the right in good faith to
contest or appeal from such laws, ordinances and regulations and any decision
adverse to Mortgagor based thereon, but all costs, fees and expenses incurred in
connection with such proceedings shall be borne by Mortgagor.
B. The term "Hazardous Substances", as used herein shall mean
Hazardous Substances or Hazardous Wastes as such terms are defined in N.J.S.A.
58:10-23.11b(k) and N.J.A.C. 7:1E-1.3 and/or those elements or compounds which
are contained in the list of hazardous substances covered by the following
federal laws: Comprehensive Environmental Response, Compensation and Liability
Act of 1980, 42 U.S.C.A. 9601 et seq.; the Superfund Amendments and
Reauthorization Act of 1987; the Resource Conservation and Recovery Act of 1976,
42 U.S.C.A. 6901 et seq.; the Clean Water Act, 42 U.S.C.A. 7401 et seq.; the
Water Pollution Control Act, N.J.S.A. 58:10A-1 et seq., and all other similar
existing and future federal, state and municipal statutes, laws and ordinances
governing the environment, all as amended from time to time, together with all
rules and regulations issued or promulgated pursuant to or in connection with
any of the foregoing.
C. Mortgagor shall not cause or permit to exist, as a result of
an intentional or unintentional action or omission on its part, a Release of
Hazardous Substances into any of the Protected Areas, unless said Release of
Hazardous Substances is pursuant to and in compliance with the conditions of a
permit issued by the appropriate federal or state governmental authorities.
D. In the event that there shall be filed a lien against the
Mortgaged Property or any part thereof (I) by the U.S. Environmental Protection
Agency or (ii) by the Department, pursuant to and in accordance with the
provisions of N.J.S.A. 58:10-23.11f(f), as a result of the chief executive of
the New Jersey Spill Compensation Fund having expended monies from said fund to
pay for Damages and/or Cleanup and Removal Costs arising from an intentional or
unintentional action or omission of Mortgagor or any previous owner and/or
operator of the Mortgaged Property, and resulting in the Release of Hazardous
Substances into any of the Protected Areas, then Mortgagor shall, within thirty
(30) days from the date that Mortgagor is given notice that the lien has been
placed against any part or all of the Mortgaged Property, or within such shorter
period of time in the event that the State of New Jersey has commenced steps to
cause the Mortgaged Property to be sold pursuant to such lien, either (I) pay
the claim and remove the lien from the Mortgaged Property, or (ii) furnish (a) a
bond satisfactory to the title insurance company and Mortgagee in the amount of
the claim out of which the lien arises, (b) a cash deposit in the amount of the
claim out of which the lien arises, or (c) other security reasonably
satisfactory to Mortgagee in an amount sufficient to discharge the claim out of
which the lien arises (subject to Mortgagee's agreement, which agreement shall
not be unreasonably withheld or delayed, that the commitment of any reputable
title insurance company affirmatively to insure over or omit such claim shall
constitute such reasonably satisfactory security).
E. Should Mortgagor cause or permit any intentional or
unintentional action or omission resulting in the Release of Hazardous
Substances into any of the Protected Areas, without having obtained a permit
issued by the appropriate governmental authorities, Mortgagor shall promptly
comply with the provisions of the New Jersey Spill Compensation and Control Act,
N.J.S.A. 58:10-23.11 et seq.
F. If Mortgagor obtains, gives or receives notice of any Release
of Hazardous Substances or threat thereof at the Mortgaged Property, or receives
any notice of violation, request for information or notification that it is
potentially responsible for investigation or cleanup of environmental conditions
at the Mortgaged Property, demand letter or complaint, order, citation, or other
notice with regard to any Release of Hazardous Substances or any other
environmental matter affecting the Mortgaged Property or Mortgagor's interest
therein (an "Environmental Complaint") from any person or entity, including the
Department or the U.S. Environmental Protection Agency (either, the
"Authority"), then Mortgagor shall, within five (5) business days, give written
notice of same to Mortgagee detailing the facts and circumstances giving rise to
the Release of Hazardous Substances or Environmental Complaint. Such information
is to be provided to allow Mortgagee to protect its security interest in the
Mortgaged Property.
<PAGE>
G. Mortgagor shall promptly forward to Mortgagee copies of any
request for information, notification of potential liability, demand letter
relating to potential responsibility with respect to the investigation or
cleanup of Hazardous Substances at any other site owned, operated or used by
Mortgagor to dispose of Hazardous Substances and shall continue to forward
copies of communications regarding such claims to Mortgagee until the claim is
settled. Mortgagor shall promptly forward to Mortgagee a copy of any filing
relating to the Release of Hazardous Substances at any other property owned or
leased by Mortgagor that Mortgagor is required to file under any state or local
environmental law, regulation or ordinance. Such information is to be provided
to allow Mortgagee to protect its security interest in the Mortgaged Property.
H. If Mortgagor shall fail to respond promptly to any Release of
Hazardous Substances, Environmental Complaint or the presence of any Hazardous
Substances affecting the
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<PAGE>
Mortgaged Property, whether or not the same originates or emanates from the
Mortgaged Property or any other real estate, and/or if Mortgagor shall fail to
comply with any of the requirements of any federal or state environmental law or
regulation or local ordinance, Mortgagee may, at its election, but without the
obligation to do so after notice and no cure by Mortgagor within five (5) days:
(i) give such notices, and/or (ii) enter onto the Mortgaged Property after
reasonable notice to Mortgagor and take such actions as Mortgagee deems
reasonably necessary or advisable to clean up, remove, mitigate or otherwise
deal with any Release of Hazardous Substances, the presence of Hazardous
Substances or any Environmental Complaint. All reasonable costs and expenses
incurred by Mortgagee in the exercise of any such rights, including any sums
paid in connection with any judicial or administrative investigation or
proceeding, fines, penalties, fees for legal counsel and other professionals,
together with interest thereon at the default rate stipulated in the Note, and
if not specified therein, then at the then applicable rate of interest under the
Note, from the date of payment by Mortgagee, shall be immediately due and
payable by Mortgagor to Mortgagee, and until paid, shall be added to and become
a part of the indebtedness under the Note and shall be secured by the lien of
this Mortgage.
I. Promptly upon the written request of Mortgagee, which written
request may be made by Mortgagee from time to time, Mortgagor shall provide
Mortgagee, at Mortgagee's initial expense (to be reimbursed by Mortgagor to
Mortgagee, immediately upon demand, if such assessment or audit reveals that any
Release of Hazardous Substance or other failure or default under this Article,
has occurred), an environmental site assessment or environmental audit report
issued in favor of Mortgagee and its counsel and prepared by an environmental
engineering firm acceptable, in the reasonable opinion of Mortgagee, to assess
with a reasonable degree of certainty the existence of a Release of Hazardous
Substances and the potential costs in connection with abatement, cleanup or
removal of any Hazardous Substances found on, under, at or within the Mortgaged
Property; provided that:
(1) If such estimates, individually or in the aggregate,
exceed $100,000.00, Mortgagee shall have the right to require Mortgagor to post
a bond to secure payment of these costs and expenses; and
(2) If the Release of Hazardous Substances is the subject of
any governmental inquiry, investigation or audit, then the provisions of the
preceding subsection shall be suspended during any such governmental action, and
Mortgagor shall be subject to any requirement imposed as a result of such
governmental action.
J. In addition to the Events of Default set forth elsewhere in
this Mortgage, the filing by any Authority of an Environmental Complaint or
expenditure of money by any Authority to respond to a Release of Hazardous
Substances or Environmental Complaint at the Mortgaged Property (an "Action")
shall constitute an Event of Default under this Mortgage; provided, however,
such Action shall not constitute an Event of Default if, within thirty (30) days
of the date of notice to Mortgagor of such Action, Mortgagor demonstrates to the
reasonable satisfaction of Mortgagee that it has commenced and is diligently
pursuing either: (a) cure or correction of the event which constitutes the basis
for the Action, including, as necessary, payment of any claims and removal of
any lien imposed and continues diligently to pursue such cure or correction to
completion, or (b) institutes proceedings for an injunction, a restraining order
or other appeal procedure seeking to prevent such Authority from enforcing such
Action or to defend against the enforcement of such Action. Mortgagor shall post
a bond, letter of credit or other security, in form, substance, and amount
acceptable to Mortgagee and the Authority or entity seeking to enforce the
Action, to secure the proper and complete cure or correction of the event which
constitutes the basis for the Action. Subject to Mortgagee's agreement, which
agreement shall not be unreasonably withheld or delayed, the commitment of any
reputable title insurance company to affirmatively insure over or to omit such
lien shall constitute such reasonably satisfactory security.
K. Except with respect to any occurrence prior to July 19, 1996,
and except with respect to any act or omission of Mortgagee after taking
possession of the Mortgaged Property, Mortgagor shall defend and indemnify
Mortgagee and hold Mortgagee harmless from and against all loss, liability,
damages and expenses, claims, costs, fines, penalties, including fees for legal
counsel and other professionals, suffered or incurred by Mortgagee, whether as
holder of this Mortgage, as a mortgagee in possession, or as
successor-in-interest to Mortgagor, by foreclosure deed or deed in lieu of
foreclosure, under or on account of any environmental statute, law, ordinance or
<PAGE>
order including the assertion of any lien thereunder, with respect to any
Release of Hazardous Substances, the presence of any Hazardous Substances
affecting the Mortgaged Property, whether or not the same originates or emanates
from the Mortgaged Property, including any loss of value of the Mortgaged
Property as a result of the foregoing so long as no such loss, liability, damage
and expense is attributable to any Release of Hazardous Substances resulting
from actions on the part of Mortgagee. Mortgagor's obligations under this
Article shall arise upon the discovery of the presence of any Hazardous
Substances at the Mortgaged Property, whether or not any federal, state, or
local environmental agency has taken or threatened any action in connection with
the presence of any Hazardous Substances. Mortgagor's obligation hereunder shall
survive the termination of this Mortgage.
27. Condominium Regime: Mortgagor covenants and agrees not to
submit any part of the Mortgaged Property to a condominium regime without the
prior written approval of Mortgagee. If Mortgagee does grant such approval,
Mortgagee shall automatically have the right, but not the obligation,
10
<PAGE>
to succeed to Mortgagor as developer or grantor under any master deed subjecting
the Mortgaged Property to a condominium regime.
28. Intentionally Deleted.
29. Intentionally Deleted.
30. Purchase Agreements: Mortgagor hereby represents that there are
no purchase agreements or agreements to sell all or any part of the Mortgaged
Property now in effect.
31. Intentionally Deleted.
32. Bankruptcy Waiver: Mortgagor agrees that, in consideration of
the recitals and mutual covenants contained herein, and for other good and
valuable consideration, if Mortgagor or any general partner of Mortgagor shall
(I) file with any bankruptcy court of competent jurisdiction or be the subject
of any petition under Title 11 of the U.S. Code, as amended, (ii) be the subject
of any order for relief issued under such Title 11 of the U.S. Code, as amended,
(iii) file or be the subject of any petition seeking any reorganization,
arrangement, composition, readjustment, liquidation, dissolution, or similar
relief under any present or future federal or state act or law relating to
bankruptcy, insolvency, or other relief for debtors, (iv) have sought or
consented to or acquiesced in the appointment of any trustee, receiver,
conservator, or liquidator, (v) be the subject of any order, judgment, or decree
entered by any court of competent jurisdiction approving a petition filed
against such party for any reorganization, arrangement, composition,
readjustment, liquidation, dissolution, or similar relief under any present or
future federal or state act or law relating to bankruptcy, insolvency, or relief
for mortgagors, Mortgagor shall not assert or request any other party to assert
that the automatic stay provided by Section 362 of Title 11 of the U.S. Code
(the "Bankruptcy Code") shall operate or be interpreted to stay, interdict,
condition, reduce or inhibit the ability of Mortgagee to enforce any rights it
has by virtue of this Mortgage and all documents executed by Mortgagor in
connection herewith, or at law or in equity, or any other rights Mortgagee has,
whether now or hereafter acquired, against Mortgagor or against any collateral
for the loans evidenced by the Note, including, but not limited to the Mortgaged
Property. Specifically, without limiting the foregoing, in the event of any such
voluntary or involuntary bankruptcy filing following the execution and delivery
of this Mortgage and all documents executed by Mortgagor in connection herewith,
Mortgagee shall be entitled, and Mortgagor irrevocably consents, to an order
granting relief from any and all stays, including the automatic stay imposed by
Section 362 of the Bankruptcy Code or equitable relief under Section 105 of the
Bankruptcy Code, so as to permit Mortgagee to foreclose upon the Collateral and
to exercise any and all other rights and remedies of Mortgagee under this
Mortgage, any of such documents, or at law or in equity, and Mortgagor hereby
irrevocably waives any right to object to such relief.
33. Recourse: Except as hereinafter set forth, Mortgagor shall not
have any personal liability for the payment or performance of any obligations
under the Note and in the event of a default under the Note, Mortgagee will look
solely to the Mortgaged Property and the rents, issues and profits thereof and
any other collateral specifically pledged, assigned or granted by Mortgagor as
security therefor, and any judgment obtained against Mortgagor shall so note by
its terms or as otherwise permissible by law. Notwithstanding the foregoing, in
the event of a default hereunder or under the Note, this obligation shall be
recourse to Mortgagor in an amount which is the difference between $3,000,000
and that portion of the recourse obligation from Mortgagor to Summit Bank
(pursuant to a Promissory Note in an amount not to exceed $9,777,240 of even
date herewith (the "Summit Note")) which is not credited by Summit Bank under
the Summit Note upon an event of default (as defined under the Summit Note) by
Mortgagor under the Summit Note (e.g., if Summit Bank utilizes $2,000,000 of the
recourse amount as a portion of or as all of its remedy under the Summit Note,
as the case may be, after an event of default under the Summit Note, the Note to
Mortgagee shall be recourse in the amount of $1,000,000). In no event, however,
shall (i) this obligation be recourse to Mortgagor in an amount greater than the
total amount owing by Mortgagor under the Note, nor (ii) the total recourse to
Mortgagor pursuant to the Note and the Summit Note exceed $3,000,000.
34. Severability: In the event any clause, provision or term of
this Mortgage shall be found by a court of competent jurisdiction to be void or
unenforceable, such finding shall not be construed to affect the validity of the
remaining terms and conditions hereof and such remaining terms and conditions
shall remain in full force and effect.
<PAGE>
35. Modification: The parties to this Mortgage may agree to change
the interest rate, due date or other term or terms of this Mortgage or the Note.
If the parties agree to a change, which change is a "modification" as defined in
N.J.S.A. 46:9-8.1 et seq., this Mortgage shall be subject to the priority
provisions of that law.
36. Captions: The captions preceding the text of the paragraphs or
subparagraphs of this Mortgage are inserted only for convenience or reference
and shall not constitute a part of this Mortgage, nor shall they in any way
affect its meaning, construction or effect.
37. Governing Law: This Mortgage and the performance of Mortgagor's
obligations hereunder shall be governed by the laws of the State of New Jersey.
38. Venue: The parties hereby irrevocably and unconditionally agree
that any suit, action or other legal proceeding arising out or in connection
with this Mortgage, or the obligations secured hereby, shall be brought in the
courts of record of the State of New Jersey or the courts of the United States
11
<PAGE>
located in said state, consents to jurisdiction of each such court in any such
suit, action or proceeding, and waive any objection to the venue of any such
suit, action or proceeding in any of such courts.
39. WAIVER OF JURY TRIAL: TO THE EXTENT PERMITTED BY LAW, THE
PARTIES HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO TRIAL BY JURY IN ANY LITIGATION
BETWEEN MORTGAGOR AND MORTGAGEE ARISING OUT OF OR IN CONNECTION WITH THE LOAN,
THIS MORTGAGE AND ANY OF THE OTHER LOAN DOCUMENTS. MORTGAGOR ACKNOWLEDGES THE
IMPORTANCE OF THIS RIGHT AND MAKES A KNOWING WAIVER THEREOF IN CONSIDERATION OF
THE WILLINGNESS OF MORTGAGEE TO MAKE THE LOAN TO IT.
IN WITNESS WHEREOF, this Mortgage has been duly executed as of the
day and year first above written.
BRANDYWINE REALTY TRUST, a Maryland real
estate investment trust
By: /s/ Gerard H. Sweeney
-----------------------------------
Gerard H. Sweeney, President
12
<PAGE>
STATE OF NEW JERSEY :
: s.s.
COUNTY OF CAMDEN :
BE IT REMEMBERED, that on this ___ day of _________________, 1996,
before me, the undersigned authority, personally appeared GERARD H. SWEENEY,
President of BRANDYWINE REALTY TRUST, Mortgagor mentioned in the within
instrument, who I am satisfied is the person who signed the within instrument,
and he acknowledged that he signed and delivered the same as such officer
aforesaid, and that the within instrument is the voluntary act and deed of such
corporation.
_________________________________________
Printed Name:____________________________
Title:___________________________________
Commission Expiration:___________________
66824-3
July 19, 1996
UMR-002-003
13
<PAGE>
Schedule C
Land
Description SURETY File Number
TITLE CORPORATION ST 20505
- -------------------------------------------------------------------------------
REVISED LEGAL DESCRIPTION
ALL that certain land and premises situate in the Township of Cherry Hill,
County of Camden and the State of New Jersey, bounded and described as follows:
TRACT #1-BEGINNING at a point in the Southerly right of way line of New Jersey
State Highway Route #38, said point being corner formed by the intersection of
the said line of New Jersey State Highway Route #38 with the Easterly right of
way line of Third Avenue (50 feet wide), and extending; thence along the said
right of way line of New Jersey State Highway Route #38; thence
(1) South 80 degrees 11 minutes 00 seconds East, 19.53 feet to an angle point
common with the Southwesterly right of way line of the access road (ramp from
New Jersey State Highway Route #38 to Haddonfield Road), and extending; thence
along the said right of way line to the access road; thence
(2) South 45 degrees 29 minutes 39 seconds East, 336.69 feet to an angle point,
and extending; thence along the right of way line; thence
(3) South 21 degrees 17 minutes 18 seconds East, 120.52 feet to a point formed
by the intersection of said access road with the Westerly right of way line of
Haddonfield-Sorrell Horse Road (formerly Stoy Landing Road) a/k/a Camden County
Route #644 (formerly 66 feet wide), and extending; thence along the said
right of way line of Haddonfield-Sorrell Horse Road; thence
(4) South 09 degrees 49 minutes 00 seconds West, 283.83 feet to an angle point,
and extending; thence along the said right of way line of Haddonfield-Sorrell
Horse Road; thence
(5) South 24 degrees 17 minutes 14 seconds West, 96.03 feet to an angle point,
and extending; thence along the said right of way line of Haddonfield-Sorrell
Horse Road; thence
(6) South 09 degrees 49 minutes 00 seconds West, 257.21 feet to a point of
curvature and extending; thence
(7) at the point of curvature in the Westerly right of way line of
Haddonfield-Sorrell Horse Road, curving to the right having a radius of 30 feet,
and an arc length of 57.17 feet to a point of tangency connecting the
Northeasterly right of way line of Chapel Avenue (50 feet wide) a/k/a Camden
County Route #626 with the said right of way line of Haddonfield-Sorrell Horse
Road, and extending; thence along the said right of way line of Chapel Avenue;
thence
(8) North 61 degrees 00 minutes 11 seconds West, 108.14 feet to an angle point,
and extending; thence along the said right of way line of Chapel Avenue;
thence
PAGE 6
<PAGE>
Schedule C Legal SURETY File Number
Continued TITLE CORPORATION ST 20505
(9) North 52 degrees 03 minutes 39 seconds West, 43.50 feet to a corner in point
common with Lot 3, Block 176.01 on the Current Tax Map of the Township of
Cherry Hill, and extending; thence along a line common with Lot 3, Block 176.01;
thence
(10) North 09 degrees 49 minutes 00 seconds East, 178.31 feet to a corner point
common with Lots 2 and 3, Block 176.01, said Tax Map and lands now or formerly
of Chapel Printing, and extending; thence along a line common with said Lot 2;
thence
(11) South 80 degrees 11 minutes 00 seconds East, 29.43 feet to a corner point,
and extending; thence along a line common with said Lot 2; thence
(12) North 09 degrees 49 minutes 00 seconds East, 52.21 feet to a corner point,
and extending; thence along a line common with said Lot 2; thence
(13) North 80 degrees 11 minutes 00 seconds West, 183.71 feet to a corner point
common with the Easterly right of way line of Third Avenue (50 feet wide), and
extending; thence
(14) North 09 degrees 49 minutes 00 seconds East, 670.93 feet to a corner point
common with the Southerly right of way line of New Jersey State Highway Route
#38 and being the place of beginning.
BEING shown and designated as Lot 1, Block 176.01, Plate 18 on the Current Tax
Map of the Township of Cherry Hill. Being known as 457 Haddonfield Road.
TRACT #2-BEGINNING at a point formed by the intersection of the Northeasterly
line of Chapel Avenue (width varies) with the Southeasterly line of Third Avenue
(50 feet wide) and extending; thence
(1) North 09 degrees 49 minutes 01 seconds East, along the Southeasterly line of
Third Avenue, 142.67 feet to a point in the division line between existing Tax
Lots 1 and 2, Block 176.01; thence
(2) South 80 degrees 10 minutes 59 seconds East, along said division line,
183.71 feet to point concrete monument in the division line between said Tax
Lots; thence
(3) South 09 degrees 49 minutes 01 seconds West, along said division line, 52.21
feet to a set iron pin in the division line between said Tax Lots; thence
PAGE 7
<PAGE>
Schedule C Legal SURETY File Number
Continued TITLE CORPORATION ST 20505
(4) North 80 degrees 10 minutes 59 seconds West, along said division line, 29.43
feet to a found iron pin for a corner in the division line between Tax Lots 1,
2 and 3, Block 176.011 thence
(5) South 09 degrees 49 minutes 01 seconds West along the division line between
Tax Lots 1 and 3, Block 176.01, 180.26 feet to a point in the Northeasterly line
of Chapel Avenue; thence
(6) North 53 degrees 04 minutes 12 seconds West, along said line of Chapel
Avenue, 163.20 feet to an angle point in same; thence
(7) North 20 degrees 28 minutes 36 seconds West, along same, 17.86 feet to the
point and place of beginning.
BEING shown and designated as Lots 2 and 3, Block 176.01, Plate 18 on the
Township of Cherry Hill Tax Map.
COMMONLY known as 469 Third Avenue a/k/a 1700 Chapel Avenue.
PAGE 8
<PAGE>
Said property is also known and described as follows:
Description of Property
457 Haddonfield Road
Block 176.01, Lots 1,2 & 3
All those certain tract or parcel of land situated in the Township of
Cherry Hill, County of Camden and State of New Jersey, being more particularly
described as follows
BEGINNING at a point in the southerly right-of-way line of New Jersey
State Highway Route 38, said point being the corner formed by the intersection
of the said line of New Jersey State Highway Route 38 with the northeasterly
right-of-way line of Third Avenue (50 feet wide) and extending; thence, along
said right-of-way line of New Jersey State Highway Route 38(1) S. 80o 11' 00"
E., 19.53 feet to an angle point common with the southwesterly right-of-way of
the access road (ramp from New Jersey State Highway Route 38 to Haddonfield
Road) and extending; thence, along said right-of-way line to the access road (2)
S. 45o 29' 39" E., 336.69 feet to an angle point, and extending; thence, along
the right-of-way line (3) S. 21o 17' 18" E., 120.52 feet to a corner point
formed by the intersection of said access road with the westerly right-of-way
line of Haddonfield-Sorrell Horse Road (formerly Stoy Landing Road), a.k.a.
Camden County Route 644 (formerly 66 feet wide), and extending; thence, along
the said right-of-way line of Haddonfield-Sorrell Horse Road and lands of
Cinelli's Country House, Inc. (4) S. 09o 49' 00" W., 283.83 feet to an angle
point, and extending; thence, along said right-of-way line of
Haddonfield-Sorrell Horse Road (5) S. 24o 17' 14" W., 96.05 feet to an angle
point, and extending; thence, along said right-of-way line of Haddonfield Road
(6) S. 09o 49' 00" W., 257.21 feet to a point of curvature, and extending;
thence, (7) at the point of curvature in the westerly right-of-way line of
Haddonfield-Sorrell Horse Road, curving to the right, having a radius of 30.00
feet and an arc length of 57.17 feet to a point of tangency connecting the
northeasterly right-of-way line of Chapel Avenue (variable width), a.k.a. Camden
County Route 626, with the said right-of-way line of Haddonfield-Sorrell Horse
Road, and extending; thence, along said right-of-way line of Chapel Avenue (8)
N. 61o 00' 11" W. , 108.14 feet to an angle point, and extending; thence, along
said right-of-way line of Chapel Avenue the following four courses (9) N. 52o
03' 39" W., 43.50 feet to a point; thence, (10) S. 09o 49' 01" W., 1.95 feet to
a point; thence, (11) N. 53o 04' 12" W., 163.21 feet to a point; thence, (12) N.
20o 28' 36" W., 17.86 feet to a corner in the aforementioned northeasterly
right-of-way line of Third Avenue and extending; thence, along said right-of-way
line (13) N. 09o 49' 00" E., 813.30 feet to the point and place of beginning.
SAID ABOVE DESCRIBED tract or parcel of land containing within said bounds
6.324 acres more or less.
The herein above described is prepared in accordance with an "ALTA/ACSM
(1992) Land Title Survey Block 176.01, Lots 1, 2 & 3" prepared by Taylor,
Wiseman and Taylor, Mt. Laurel, New Jersey. Scale 1"=30", dated July, 1996 (Dwg.
No. 355-17427)
<PAGE>
Exhibit 99.7 Amended and Restated
Loan Agreement between the
Trust and Summit Bank ("SB")
AMENDED AND RESTATED LOAN AGREEMENT
AGREEMENT dated this 19th day of July, 1996, by and between BRANDYWINE
REALTY TRUST, a Maryland real estate investment trust with an office at Two
Greentree Centre, Suite 100, Marlton, New Jersey 08053 ("Borrower"), and SUMMIT
BANK, a New Jersey state bank (formerly known as United Jersey Bank/South, N.A.
and United Jersey Bank) with an office at 1800 Chapel Avenue West, Cherry Hill,
New Jersey 08002 ("Bank").
Background
On December 29, 1993 the Bank and UM Real Estate Investment Corp. ("UM
Corp.") entered into a Loan Agreement ("Original Loan Agreement") pursuant to
which the Bank agreed to loan to UM Corp. (i) $6,000,000 ("Acquisition Loan") to
finance the acquisition of certain real property located at 457 Haddonfield Road
and constituting Block 176.01, Lot 1, in Cherry Hill Township, Camden County,
New Jersey, as more particularly described on Exhibit A attached hereto
("Primary Property"), and the improvements thereon including a seven (7) story
office building containing approximately 121,737 net rentable square feet
(collectively, the "Building"), and (ii) up to $1,500,000 ("Construction Loan")
to finance the construction of certain tenant improvements to the Building. The
Acquisition Loan and Construction Loan are hereinafter referred to collectively
as the "Original Loans". The Acquisition Loan was evidenced by a Promissory Note
dated December 29, 1993 in the stated principal amount of $6,000,000 executed by
UM Corp. and made payable to the order of the Bank ("Acquisition Note"), and the
Construction Loan was evidenced by a Promissory Note dated December 29, 1993 in
the stated principal amount of $1,500,000 executed by UM Corp. and made payable
to the order of the Bank ("Construction Note"). The Acquisition Note and the
Construction Note are hereinafter referred to collectively as the "Original
Notes".
As security for the Original Loans, UM Corp. delivered or caused to be
delivered to the Bank, inter alia: (i) a Mortgage and Security Agreement dated
December 29, 1993 and recorded in the Office of the Register of Deeds of Camden
County, New Jersey, in Mortgage Book 4130, page 558 ("Original Mortgage"),
executed by UM Corp. in favor of the Bank and covering the Primary Property and
Building; (ii) an Unconditional Assignment of Leases dated December 29, 1993 and
recorded in the Office of the Register of Deeds of Camden County, New Jersey, in
Mortgage Book 4130, page 603 ("Original Assignment of Leases"), executed by UM
Corp. in favor of the Bank and covering all leases with respect to the Primary
Property and Building; (iii) UCC Financing
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Statements dated December 29, 1993 and filed in the New Jersey Secretary of
State's Office and Camden County Clerk's Office ("Original Financing
Statements"), executed by UM Corp. in favor of the Bank to evidence the grant of
security interests in the fixtures and personalty owned by UM Corp. and used in
connection with the Primary Property and Building; (iv) an Assignment of
Contract Rights and Interests in Licenses, Permits and Agreements dated December
29, 1993 ("Original Assignment of Contract Rights"), executed by UM Corp. in
favor of the Bank; (v) a Collateral Assignment of Plans, Specifications,
Surveys, Drawings and Reports dated December 29, 1993 ("Original Assignment of
Plans"), executed by UM Corp. in favor of the Bank; (vi) an Environmental
Agreement dated December 29, 1993 ("Original Environmental Agreement") executed
by UM Corp. and the Bank covering the Primary Property and Building; and (vii)
an Unconditional Guaranty of Performance dated December 29, 1993 ("Original
Performance Guaranty") executed by John Aglialoro ("Original Guarantor") in
favor of the Bank.
The Original Loan Agreement, the Original Notes, the Original Mortgage,
the Original Assignment of Leases, the Original Financing Statements, the
Original Assignment of Contract Rights, the Original Assignment of Plans, the
Original Environmental Agreement and the Original Performance Guaranty, together
with any and all other documents executed and delivered by UM Corp. or the
Original Guarantor in connection with the creation of the Loans, are hereinafter
referred to collectively as the "Original Loan Documents".
On January 31, 1994 UM Corp. was merged into UM Real Estate Investment
Company, LLC ("UM Company"). On April 23, 1994, UM Corp., UM Company and the
Original Guarantor executed and delivered to the Bank an Instrument of
Assumption ("Instrument of Assumption") pursuant to which the Loans were
reaffirmed and UM Company expressly assumed and became liable for the Loans. In
addition, in connection therewith UM Company delivered to the Bank the following
documents: (i) a Notes, Mortgage and Security Agreement Modification Instrument
dated March 26, 1994 and recorded in the Office of the Register of Deeds of
Camden County, New Jersey, in Mortgage Book 4212, Page 119 ("First Amendment of
Mortgage"); (ii) UCC Financing Statements filed in the New Jersey Secretary of
State's Office and Camden County Clerk's Office ("New Financing Statements");
(iii) a First Amendment to Promissory Note ("First Amendment of Acquisition
Note"), amending the Acquisition Note; and (iv) a First Amendment to Promissory
Note ("First Amendment of Construction Note"), amending the Construction Note.
The Instrument of Assumption, the First Amendment of Mortgage, the New
Financing Statements, the First Amendment of Acquisition Note and the First
Amendment of Construction Note, together with any and all other documents
executed and delivered
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by UM Corp., UM Company or the Original Guarantor in connection with the
assumption of obligations under the Original Loans, are hereinafter referred to
collectively as the "Assumption Documents".
On October 14, 1994 UM Company and the Bank executed a First Amendment
to Loan Agreement ("First Amendment of Original Loan Agreement") in order to
permit the Construction Loan to be used for certain other purposes and to extend
the maturity date and certain other time frames relating to the Construction
Loan. In connection therewith, (i) a Second Amendment to the Acquisition Note
("Second Amendment of Acquisition Note") was executed by UM Company in favor of
the Bank, and (ii) an Amended and Restated Promissory Note dated October 14,
1994 ("Amended and Restated Construction Note") was executed by UM Company in
favor of the Bank to replace the Original Construction Note.
As additional security for the Original Loans, UM Company delivered or
caused to be delivered to the Bank, inter alia: (i) a Second Note, Mortgage and
Security Agreement Modification Instrument dated October 14, 1994 and recorded
in the Office of the Register of Deeds of Camden County, New Jersey ("Second
Amendment of Mortgage") executed by UM Company and the Bank, amending and
modifying the Original Mortgage; (ii) a Mortgage and Security Agreement dated
October 14, 1994 and recorded in the Office of the Register of Deeds of Camden
County, New Jersey, in Mortgage Book 4283, page 445 ("Additional Mortgage")
executed by UM Company in favor of the Bank covering certain real property
located adjacent to the Primary Property at 1700 Chapel Avenue and constituting
Block 176.01, Lots 2 and 3, in Cherry Hill Township, Camden County, New Jersey,
as more particularly described on Exhibit B attached hereto ("Additional
Property"), and any and all improvements thereon (collectively, the "Additional
Property Improvements"); (iii) an Assignment of Contract Rights and Interests in
Licenses, Permits and Agreements dated October 14, 1994 ("Additional Assignment
of Contract Rights"), executed by UM Company in favor of the Bank; (iv) a
Collateral Assignment of Plans, Specifications, Surveys, Drawings and Reports
dated October 14, 1994 ("Additional Assignment of Plans"), executed by UM
Company in favor of the Bank; (v) an Environmental Agreement dated October 14,
1994 ("Additional Environmental Agreement"), executed by UM Company and the Bank
covering the Additional Property and Additional Property Improvements; and (vi)
a Confirmation of Unconditional Performance Guaranty dated October 14, 1994
("Additional Performance Guaranty"), executed by the Original Guarantor in favor
of the Bank.
The First Amendment of Original Loan Agreement, the Second Amendment of
Acquisition Note, the Amended and Restated Construction Note, the Second
Amendment of Mortgage, the Additional Mortgage, the Additional Assignment of
Contract
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Rights, the Additional Assignment of Plans, the Additional Environmental
Agreement and the Additional Performance Guaranty, together with any and all
other documents executed and delivered by UM Company or the Original Guarantor
in connection with such amendment of the Original Loans are hereinafter referred
to collectively as the "Amendment Documents".
The Original Loans, as assumed by UM Company and as amended and
modified as set forth hereinabove, are hereinafter referred to collectively as
the "Amended Original Loans", and the Original Loan Documents, as assumed by UM
Company and as amended and modified by the Assumption Documents and Amendment
Documents, are hereinafter referred to as the "Amended Original Loan Documents".
The Primary Property and Additional Property are hereinafter referred to
collectively as the "Real Property", and the Building and Additional Property
Improvements are hereinafter referred to collectively as the "Improvements".
As of this date, the aggregate outstanding principal balance of the
Amended Original Loans is $7,289,226.41 and, immediately prior to the
effectiveness of this Agreement, interest under the Amended Original Loans has
been paid through June 30, 1996.
Pursuant to a Purchase and Sale Agreement between UM Company and the
Borrower dated March 28, 1996, as amended by First Amendment to Purchase and
Sale Agreement dated May, 1996, Second Amendment to Purchase and Sale Agreement
dated June 14, 1996 and Third Amendment to Purchase and Sale Agreement dated
June 24, 1996 (collectively, the "Purchase Agreement"), concurrently herewith,
UM Company is transferring and conveying the Real Property and Improvements to
the Borrower for the total sum of $10,600,000, of which (i) $2,310,773.59 is
being paid in cash or other immediately available funds, (ii) $7,289,226.41 is
being paid by the Borrower's assumption of the Amended Original Loans and
Amended Original Loan Documents and receipt of the Real Property and
Improvements under and subject thereto, and (iii) $1,000,000 is being paid in
the form of a loan from UM Company to the Borrower ("Seller Loan") evidenced by
a promissory note in the principal amount of $1,000,000 ("Seller Note") and
secured by a second mortgage covering the Real Property and Improvements
("Seller Mortgage"). In order to document and evidence the transfer to and
assumption by the Borrower of the Amended Original Loans referred to in clause
(ii) of the immediately preceding sentence, concurrently herewith UM Companies,
the Original Guarantor, the Borrower and the Bank are executing an Assignment,
Assumption and Release Agreement dated this date ("Assignment and Assumption").
The Borrower and the Bank desire to amend and restate the Amended
Original Loans and Amended Original Loan Documents in their entirety, and in
connection therewith the Borrower desires to borrow additional funds from the
Bank and the Bank is prepared
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to lend such additional funds to the Borrower, all subject to the terms and
conditions set forth herein.
Agreement
NOW THEREFORE, in consideration of the premises, and of the mutual
promises and undertakings of the parties set forth herein, and with the
intention of being legally bound hereby, the parties hereto agree to amend and
restate in its entirety the Original Loan Agreement, as it may have been amended
by one or more of the Amended Original Loan Documents, as follows:
1. The Loan.
(a) Purpose and Amount. The Bank shall lend to the Borrower up
to the sum of $9,777,140 (the "Loan"), consisting of (i) $8,480,000 to be used
to partially finance the acquisition by the Borrower from UM Company of the Real
Property and Improvements ("Acquisition Portion of the Loan"), and (ii) up to
$1,297,140 to be used to finance the cost of certain tenant improvements
("Tenant Improvements") and leasing commissions ("Leasing Commissions") in
connection with new leases (individually, a "New Lease" and, collectively, the
"New Leases") hereinafter entered into between the Borrower and tenants with
respect to portions or all of the approximately 40,782 square feet of currently
vacant space ("Vacant Space") within the Improvements ("Tenant Improvement
Portion of the Loan"), all in accordance with and subject to the terms and
conditions set forth herein.
(b) Loan Documents.
(i) The Borrower's obligation to repay the Loan
and any other sums loaned to the Borrower by the Bank is evidenced by the
Borrower's amended and restated promissory note dated this date in the principal
amount of $9,777,140 ("Note"), providing for the payment of principal, together
with interest thereon at the rate set forth therein, in such installments, at
such times, and according to such further terms as set forth in the Note.
(ii) As security for the Note and all of the
Borrower's obligations thereunder and hereunder, the Borrower shall execute and
deliver to the Bank or cause to be executed and delivered to the Bank, as the
case may be, the following:
(A) An amended and restated mortgage and
security agreement ("Mortgage") covering the Real Property, the Improvements,
and all building materials, fixtures, machinery and equipment necessary or
incidental to the construction of the Tenant Improvements or the general
operation and maintenance of the Real Property and Improvements, and all
renewals and
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<PAGE>
replacements thereof or additions thereto, and such other property as the Bank
may reasonably require, all as more specifically described in the Mortgage.
(B) An amended and restated assignment of
all of the Borrower's right, title and interest in and to any and all present
and future leases and agreements of lease affecting the Real Property or
Improvements or any part thereof ("Assignment of Leases and Rents").
(C) An amended and restated assignment of
all of the Borrower's right, title and interest in and to all construction
contracts, architect's agreements, other contracts and agreements, and any and
all licenses, permits and approvals relating to the construction of the Tenant
Improvements, and all other documents and rights relating to the construction of
the Tenant Improvements ("Assignment of Contracts and Permits").
(D) Such security agreements, financing
statements, continuation statements and other security instruments as the Bank
shall require in order to create a valid and perfected first priority security
interest in all personal property now owned or hereafter acquired by the
Borrower and located on or used in connection with the Real Property and
Improvements.
(iii) The Borrower shall execute and deliver such
additional documents and instruments as the Bank shall reasonably require in
order to perfect the Bank's interest in any of the foregoing property. The Note,
Mortgage, Assignment of Leases and Rents, Assignment of Contracts and Permits,
financing statements and other documents and instruments referred to above (all
of which, together with this Agreement, are hereinafter collectively referred to
as the "Loan Documents") shall be in form and substance satisfactory to the
Bank, and all necessary filing and recording fees with respect thereto shall be
paid by the Borrower.
(c) Additional Security. As additional security for the Note
and all of the Borrower's obligations thereunder and hereunder, the Borrower
hereby irrevocably assigns to the Bank and grants to the Bank a security
interest in all of its right, title and interest in and to all Loan funds held
by the Bank, whether or not disbursed, all funds in the Borrower's operating
account for the Real Property and Improvements, and all reserves, deferred
payments, deposits, refunds, cost savings and payments of any kind specifically
relating to the Real Property or Improvements or construction of the Tenant
Improvements. Upon the occurrence of an event of default under any of the Loan
Documents, the Bank may use any of the foregoing for any purpose for which the
Borrower could have used them under this Agreement, including without
limitation, payments on account of the Loan.
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<PAGE>
In addition, subject to paragraph 9 hereof, the Bank shall have all other rights
and remedies with respect to any of the foregoing which are provided under
applicable law or at equity.
2. Representations and Warranties. The Borrower hereby represents and
warrants to the Bank (which representations and warranties shall survive until
the Loan has been paid in full) that:
(a) Formation; Existence. The Borrower is a real estate
investment trust duly formed, validly existing and in good standing in the
Maryland, has the power and authority to carry on its business as now conducted,
including the ownership and operation of the Real Property and Improvements. The
capital stock of the Borrower, representing the sole form of equity interest in
the Borrower, is publicly traded on the American Stock Exchange. Gerard H.
Sweeney is the President and Chief Executive Officer of the Borrower. True and
correct copies of the Borrower's Trust Agreement, together with any and all
amendments thereto, have been furnished to the Bank and the same are in full
force and effect as of the date of this Agreement. To the best of the Borrower's
knowledge, none of the equity interests of the Borrower has been offered,
issued, distributed or sold in violation of any state or federal securities
laws.
(b) Power and Authority; Authorization; Enforceability. The
Borrower has full power, authority and legal right to execute, deliver and
comply with each of the Loan Documents and any other document or instrument
relating to the Loan to be executed by the Borrower, all actions of the Borrower
and other authorizations necessary or appropriate for the execution and delivery
of and compliance with the Loan Documents and such other documents and
instruments have been taken or obtained and, upon their execution, the Loan
Documents and such other documents and instruments shall constitute the valid
and legally binding obligations of the Borrower enforceable against the Borrower
in accordance with their respective terms subject to limitations on
enforceability as may be imposed by laws relative to bankruptcy, insolvency or
equitable principles generally.
(c) Governmental Approval of Loan Documents. No consent,
approval or other authorization of or by any court, administrative agency or
other governmental authority is required in connection with the Borrower's
execution and delivery of or compliance with any of the Loan Documents or any
other document or instrument relating to the Loan executed by the Borrower.
(d) Conflict; Breach. The Borrower's execution and delivery of
and compliance with the Loan Documents and any other documents and instruments
relating to the Loan will not conflict with or result in a breach of any
applicable law, judgment, order, writ, injunction, decree, rule or regulation of
any court,
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administrative agency or other governmental authority, or of any agreement or
other document or instrument to which the Borrower is a party or by which it is
bound, and such action by the Borrower will not result in the creation or
imposition of any lien, charge or encumbrance upon any property of the Borrower
in favor of anyone other than the Bank.
(e) Litigation. There is no action, suit or proceeding pending
or, to the knowledge of the Borrower, threatened against or affecting the
Borrower or the Real Property before or by any court, administrative agency or
other governmental authority, or which brings into question the validity of the
transactions contemplated hereby.
(f) Financial Statements. The 10Q of the Borrower as of and
for the period ending March 31, 1996 and the 10K of the Borrower as of and for
the period ending December 31, 1995, including the financial statements
contained therein, fairly and accurately reflect the financial condition of the
Borrower as of and for the respective periods shown therein, and there has been
no material adverse change in the financial condition or business of the
Borrower since the respective dates thereof.
(g) Tax Returns. Any and all federal, state and local income
tax returns required to have been filed by the Borrower (or extensions thereto)
have been filed, and all taxes reflected upon any such tax returns, all past due
taxes, interest and penalties and all estimated payments required to be paid
have been paid.
(h) Bankruptcy; Insolvency. The Borrower has not applied for
or consented to the appointment of a receiver, trustee or liquidator of itself
or any of its property, admitted in writing its inability to pay its debts as
they mature, made a general assignment for the benefit of creditors, been
adjudicated a bankrupt or insolvent or filed a voluntary petition in bankruptcy,
or a petition or an answer seeking reorganization or an arrangement with
creditors or to take advantage of any bankruptcy, reorganization, insolvency,
readjustment of debt, dissolution or liquidation law or statute, or an answer
admitting the material allegations of a petition filed against it in any
proceeding under any such law, and no action has been taken by it for the
purpose of effecting any of the foregoing. No order, judgment or decree has been
entered by any court of competent jurisdiction approving a petition seeking
reorganization of the Borrower, or all or a substantial part of the assets of
the Borrower, or appointing a receiver, sequestrator, trustee or liquidator of
the Borrower or any of its property.
(i) Title to Real Property. The Borrower has good and
marketable title to an indefeasible fee simple estate in the Real Property,
subject to no lien, charge or encumbrance except the
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Seller Mortgage and such as are listed as exceptions to title or exclusions from
coverage in the title insurance policy being issued by Lawyers Title Insurance
Corporation ("Title Company") to the Bank concurrently with the recording of the
Mortgage. The Primary Property and Additional Property are contiguous to each
other without the existence of any gaps or gores.
(j) Title to Personal Property. All personal property with
respect to which the Borrower has granted to the Bank a security interest
pursuant to any of the Loan Documents is otherwise owned by the Borrower free
and clear of all liens, encumbrances and security interests.
(k) Environmental Matters.
(i) To the best of the Borrower's knowledge based
upon the Phase I environmental report described in paragraph 4(d)(iii) hereof
("Environmental Report") and the Purchase Agreement, except as may be set forth
in the Environmental Report or the Purchase Agreement and except for the use and
storage of Hazardous Substances (hereinafter defined) in de minimis amounts
which are used in and stored in compliance with all applicable laws and
regulations, (A) the Real Property has not been used for the generation,
manufacture, storage or disposal of, and there has not been transported to or
from the Real Property, any Hazardous Substances or Wastes (as hereinafter
defined), (B) there are no Hazardous Substances or Wastes present on the Real
Property, (C) the Real Property does not consist in whole or in part of any
soils or vegetation that would be considered to be protected wetlands as defined
in applicable federal, state and local laws and regulations ("Wetlands"), (D)
there has been no use of the Real Property that may, under any federal, state or
local law or regulation, require any closure or cessation of the use of the Real
Property or impose upon the Borrower or its successors any monetary obligations,
(E) no lien or superlien has been recorded, asserted or threatened against the
Real Property for any liability in connection with any environmental
contamination, and (F) the Real Property is in compliance with all federal,
state or local laws and regulations relating to environmental matters.
(ii) The Borrower's knowledge with respect to
environmental matters affecting the Real Property and Improvements is limited to
such matters, if any, which appear in the Environmental Report or Purchase
Agreement.
(iii) The Borrower has not been identified in any
litigation, proceeding or investigation as a responsible party or potentially
responsible party for any liability for disposal or release of any Hazardous
Substances or Wastes.
(iv) For the purposes hereof: (A) "Hazardous
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Substances" shall mean any flammable explosives, radioactive materials,
asbestos, urea-formaldehyde, hazardous wastes, toxic substances or any other
elements or compounds designated as a "hazardous substance", "pollutant",
"contaminant" or "regulated substance" in the Comprehensive Environmental
Response, Compensation and Liability Act or in the Resource Conservation and
Recovery Act, both as amended by the Superfund Amendments and Reauthorization
Act of 1986, or the Toxic Substance Control Act, the New Jersey Industrial Site
Recovery Act, the New Jersey Spill Compensation and Control Act, or any other
applicable federal, state or local law or regulation and (B) "Wastes" shall mean
any hazardous wastes, biological or medical wastes, residual wastes, solid
wastes or other wastes as those terms are defined in the applicable federal,
state or local laws or regulations.
(l) Compliance with Laws. To the best of the Borrower's
knowledge which is based upon UM Company's representations and warranties in the
Purchase Agreement and in the letter dated July 2, 1996 from Cherry Hill
Township to Brad A. Molotsky, Esq., counsel for the Borrower, the current use of
the Real Property and Improvements as an office building complies in all
respects with all subdivision, zoning, building and other applicable laws,
ordinances, rules and regulations.
(m) Leases. The Borrower has delivered to the Bank true,
correct and complete copies of all lease agreements affecting any portion of the
Real Property and Improvements. To the best of the Borrower's knowledge based
upon the estoppel certificates executed by lessees of the Real Property and
Improvements and delivered to the Bank on the date hereof, there are no events
of default in existence under any such lease agreements or events which, with
the passage of time or giving of notice or both, would constitute an event of
default under any such lease agreements.
(n) Management Agreements. There is no management agreement in
effect with respect to the management or operation of the Real Property and
Improvements.
3. Covenants. The Borrower covenants and agrees that, until the Loan
has been paid in full:
(a) Compliance with Laws. The Borrower shall operate and
maintain the Real Property and Improvements as an office building in all
respects in compliance with all subdivision, zoning, building, and other
applicable laws, ordinances, rules and regulations.
(b) Leases. The Borrower shall not enter into any New Lease or
similar agreement for space comprising any portion or all of the Real Property
and Improvements without in each case using the standard form of lease agreement
attached hereto as
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Exhibit C and obtaining the Bank's prior written approval of all of the terms
and conditions thereof, which approval shall not be unreasonably withheld or
delayed. Once any such lease or similar agreement is approved, the Borrower
shall not amend, modify or cancel such lease or agreement without in each case
obtaining the Bank's prior written approval.
(c) Management Agreements. The Borrower shall not enter into
any management agreement with respect to all or any portion of the Real Property
and Improvements without in each case obtaining the Bank's prior written
approval, which shall not be unreasonably withheld or delayed so long as there
is no continuing event of default in existence under any of the Loan Documents.
With respect to any such approved management agreement, (i) there shall be no
amendment or modification thereof without in each case obtaining the prior
written approval of the Bank, and (ii) the lien and priority of payments under
such management agreement shall be under and subject and subordinate to payments
under the Loan pursuant to a subordination agreement among the Borrower, the
manager and the Bank or other documentation satisfactory in form and substance
to the Bank.
(d) Status of Title to Real Property and Improvements. Except
for Permitted Transfers (as hereinafter defined), the Borrower shall not
transfer control or ownership of the Real Property and Improvements or any part
thereof, directly or indirectly, voluntarily or involuntarily, without the prior
written approval of the Bank. Other than the Seller Mortgage, the Borrower shall
not create or permit to exist any lien, encumbrance or security interest
(whether consensual or otherwise) in favor of any third party with respect to
the Real Property and Improvements or any item of property, whether or not a
fixture, installed on the Real Property and Improvements or stored thereat and
the Borrower shall keep all such property free from any such lien, encumbrance
or security interest other than those created in favor of the Bank as
contemplated herein and liens for taxes not yet due and payable. In general, the
Borrower shall keep the title to the Real Property and the Improvements free of
any matter which would, at the time of completion of the Tenant Improvements,
prevent any title insurance company from certifying the lien of any mortgage to
be executed in favor of a permanent lender or other mortgagee in substitution
for or in payment of the Loan, as other than a good and valid first lien upon
the Real Property and the Improvements.
(e) Mechanic's Liens and Other Encumbrances. The Borrower
shall pay, discharge or obtain release bonds from a reputable surety company
satisfactory to the Bank for any mechanic's liens or other encumbrances which
may be filed or recorded against the Real Property or Improvements within ten
(10) days after it receives notice thereof, from the Bank or
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otherwise. In the event that the Borrower shall fail to pay or discharge any
such mechanic's lien or other encumbrance, the Bank, in addition to such other
rights as may be available to it, may pay and discharge such mechanic's lien or
other encumbrance or deposit in escrow an amount sufficient to do so or cause a
mechanic's lien release bond to be issued with respect thereto and pay such
amounts as may be necessary in connection therewith, and all amounts so paid or
deposited shall be treated as an advance of the Loan from the Bank to the
Borrower.
(f) Environmental Matters. The Borrower will not, and will use
reasonable efforts not to, permit any tenant or other occupant of the Real
Property or Improvements to, store, use, generate, treat or dispose of any
Hazardous Substances or Wastes on the Real Property or Improvements except in de
minimus quantities and in accordance with applicable laws. The Borrower promptly
shall advise the Bank in writing of and with respect to any pending or known
threatened claim, demand, action or notice by any governmental authority or
third party relating to any Hazardous Substances or Wastes affecting the Real
Property or Improvements or the discovery or determination of the existence of
any Hazardous Substances or Wastes or Wetlands on the Real Property or
Improvements. The Bank shall have the right to join in or participate in any
legal proceedings or actions initiated in connection with any Hazardous
Substances, Wastes or Wetlands affecting the Real Property or Improvements. The
Borrower shall reimburse the Bank for reasonable attorneys' fees and costs in
connection therewith and the Borrower shall indemnify, defend and hold harmless
the Bank from and against any claim, demand, loss or liability, including but
not limited to costs of remedial action, response costs, personal injury and
property damage, directly or indirectly arising out of or attributable to the
use, generation, deposit, storage, release, discharge, disposal, burial,
dumping, spilling, leaking or other presence of Hazardous Substances or Wastes
on, under or affecting the Real Property or Improvements or arising as the
result of the existence of Wetlands on the Real Property or Improvements. The
foregoing indemnity shall specifically survive the repayment of the Loan and the
satisfaction of the Mortgage. The Borrower shall not, without obtaining the
Bank's prior written consent, which consent shall not be unreasonably withheld
or delayed so long as there is no continuing event of default then in existence
under any of the Loan Documents, enter into any settlement agreement, consent
decree or other compromise in respect to any Hazardous Substances, Wastes or
Wetlands affecting the Real Property or Improvements.
(g) Additional Financing. Except for the Seller Loan, the
Borrower shall not incur any additional indebtedness secured by any lien or
security interest on the Real Property and Improvements or any other property
encumbered in favor of the Bank to secure the Loan.
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(h) Financial Information.
(i) Within one hundred twenty (120) days after the
end of each fiscal year of the Borrower, the Borrower shall furnish the Bank
with annual financial statements for the Borrower consisting of a balance sheet,
a statement of income and expense, cash flow statement and rent roll for the
Real Property and Improvements, prepared and audited by Arthur Andersen, L.P.,
or another independent certified public accounting firm acceptable to the Bank.
(ii) Within forty-five (45) days after the end of
each fiscal quarter annual period of the Borrower, the Borrower shall furnish
the Bank with financial statements for such quarter annual period consisting of
a balance sheet, statement of income and expense, cash flow statement and rent
roll for the Real Property and Improvements, prepared by management and reviewed
by Arthur Andersen, L.P., or another independent certified public accounting
firm acceptable to the Bank.
(iii) Within thirty (30) days after the respective
filings thereof, the Borrower shall furnish the Bank with copies of the
Borrower's federal and state income tax returns, certified by the chief
financial officer of the Borrower as true and correct copies of such returns as
filed.
(iv) The Borrower shall furnish to the Bank such
other financial information with respect to the Real Property and Improvements
as the Bank from time to time reasonably may request.
(v) At all times during the term of the Loan, (i) the
Borrower's stated net worth shall equal or exceed $6,300,000 and (ii) the
Borrower's Funds from Operations Payout Ratio (as defined by the National
Association of Real Estate Investment Trusts, Inc.) shall not exceed one hundred
ten percent (110%). Compliance with such covenants shall be confirmed in the
quarter annual financial statements of the Borrower delivered pursuant to
section (ii) hereof and shall be certified to by the chief financial officer of
the Borrower.
(i) Composition of the Borrower. During the term of the Loan,
the Borrower shall maintain its existence as a real estate investment trust
under the laws of the State of Maryland. The Borrower's equity securities may be
subject to normal trading in the public securities markets and there may be
public offerings of the Borrower's equity securities without requirement for the
Bank's consent with respect thereto ("Permitted Transfers"). However, the Bank
shall have the right to review and approve, within ten (10) days after delivery
to the Bank of all information reasonably necessary in order for the Bank to so
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review and approve, any merger involving the Borrower or any material change in
the ownership of the equity securities of the Borrower, and in the event of any
disapproval thereof by the Bank, the Loan, at the Bank's option, shall become
due and payable within one hundred twenty (120) days after written notice
thereof from the Bank to the Borrower. The Borrower shall advise the Bank of the
nature of any changes in its Trust Agreement or other organizational documents
promptly after any such changes, and the Borrower shall not change any such
organizational documents in any manner which would affect its ability to perform
any of its obligations under any of the Loan Documents, without in each case
obtaining the prior written approval of the Bank.
(j) Principal Office. The Borrower shall maintain its
principal office and/or the office where it keeps its books and records relating
to the Real Property and Improvements at Two Greentree Centre, Suite 100,
Marlton, New Jersey 08053, unless it gives the Bank prior written notice of any
proposed change in location thereof.
(k) Books and Records. The Borrower shall keep complete and
accurate books and records with respect to the Real Property and Improvements in
accordance with generally accepted accounting principles consistently applied.
The Borrower shall furnish to the Bank all such written information relating to
its affairs as reasonably may be requested by the Bank from time to time.
(l) Operating Account. The Borrower shall maintain with the
Bank its primary operating account for the Real Property and Improvements, which
account shall be the sole depository for the rental income from the Real
Property and Improvements.
(m) Audit. The Bank shall have the right at any time and from
time to time, subject to two (2) days prior notice and during normal business
hours, to audit the books and records of the Borrower relating to the Real
Property and Improvements, and the Borrower shall be obligated to make available
for any such audit all books, records and other information relating to the Real
Property and Improvements that the Bank may reasonably request for such purpose
and to cooperate fully with the Bank in connection therewith. The cost of any
such audit shall be borne by the Bank if at the time thereof there is no event
of default then in existence under any of the Loan Documents, and the cost
thereof shall be borne by the Borrower if there is an event of default then in
existence under any of the Loan Documents.
(n) Use of Proceeds. The Borrower shall use the proceeds of
the Loan solely for the purposes and in the amounts set forth in paragraph 1(a)
hereof.
(o) Changed Circumstances. The Borrower shall promptly notify
the Bank in the event any representation or
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warranty made by the Borrower herein or in any other documents furnished to the
Bank in connection with this Agreement becomes false or inaccurate in any
material respect.
(p) Bank's Costs. The Borrower shall pay or reimburse the Bank
for all reasonable costs and expenses (including but not limited to attorneys',
surveyors', appraisal, environmental and engineering fees and costs) incurred by
the Bank in connection with the preparation, review, modification and
enforcement of the Loan Documents and any other document or instrument relating
to the Loan and the collection of the Loan.
(q) Bank's Fees. As compensation for the expenses of
underwriting and evaluating the Loan, the Borrower shall pay to the Bank on the
date hereof the sum of $100,000 ("Loan Fee"), less any portion thereof already
paid by the Borrower to the Bank. The Loan Fee shall be in addition to the
interest and any and all other amounts which the Borrower is required to pay
under the Loan Documents.
4. Conditions Precedent. The obligation of the Bank to make the Loan to
the Borrower is subject to the satisfaction of the following conditions
precedent:
(a) Representations and Warranties. Each and all of the
representations and warranties set forth in paragraph 2 hereof shall be true and
correct in all respects.
(b) Fees, Charges and Premiums. The Borrower shall have paid
for all premiums on insurance policies and bonds, all recording and title
company costs and charges assessed against the Borrower, the commitment fee of
the Bank, and the legal fees and disbursements of the Bank's counsel in
connection with the Loan.
(c) Delivery of Loan Documents. The Loan Documents shall have
been duly executed and delivered to the Bank and, where applicable, shall have
been delivered to the Title Company for recording or filing in the appropriate
public office.
(d) Delivery of Other Documents. The following documents shall
have been delivered by or on behalf of the Borrower to the Bank:
(i) Survey of Real Property and Improvements. An
as-built survey of the Real Property and Improvements, certified to and
acceptable to the Bank and the Title Company and paid for by the Borrower
bearing the stamp of a registered surveyor showing the distance to the nearest
intersection and the location of all improvements, utility lines, easements,
rights-of-way, restrictions, encroachments and building setback lines, together
with a metes and bounds description of the Real Property and
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Improvements corresponding to such survey, sufficient to enable the Title
Company to issue title insurance without a survey exception and to issue a
contiguity endorsement insuring that the Primary Property and Additional
Property are contiguous to each other without the existence of any gaps or
gores.
(ii) Appraisal. An appraisal of the Real Property
and Improvements based upon their current fair market value ("As Is Value") and
based upon their fair market value assuming the execution of New Leases covering
all of the current Vacant Space within the Improvements and full advance of the
Tenant Improvement Portion of the Loan ("Fully Leased Stabilized Value"), which
appraisal shall (i) be performed in accordance with the provisions of Title 11
of the Financial Institutions Reform, Recovery and Enforcement Act of 1989 by an
appraiser selected by or acceptable to the Bank, (ii) indicate that the
principal amount of the Acquisition Portion of the Loan is no greater than
eighty percent (80%) of the As Is Value and that the principal amount of the sum
of (A) the Acquisition Portion and (B) the Tenant Improvement Portion of the
Loan, do not exceed seventy-five percent (75%) of the Fully Leased Stabilized
Value of the Real Property and Improvements, and (iii) otherwise be satisfactory
in form and substance to the Bank.
(iii) Environmental Report. A phase I environmental
report prepared by an independent environmental engineering firm or firms
acceptable to the Bank and paid for by the Borrower indicating that there are no
Hazardous Substances, Wastes or Wetlands in, on or around the Real Property and
Improvements and otherwise in form and substance satisfactory to the Bank.
(iv) Structural and Engineering Report. A report
prepared by an independent engineering firm or firms acceptable to the Bank,
paid for by the Borrower, and in form and substance satisfactory to the Bank,
stating that such firm has inspected the physical condition and structural
integrity of the Improvements on the Real Property, including, but not limited
to, heating, ventilation and air conditioning units, and electrical, plumbing,
roofing and mechanical systems, and has found them to be in good working order
and repair.
(v) Certificates of Occupancy; Evidence of
Compliance. Copies of all applicable certificates of occupancy (or their
equivalents) for the Real Property and Improvements, and/or other evidence
satisfactory to the Bank that the Real Property and Improvements and the use
thereof complies with all applicable governmental requirements, including but
not limited to zoning, subdivision, land use and development, building, safety
and health laws, ordinances and regulations.
(vi) Title Insurance. Marked-up title reports of
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the Title Company, representing its commitment to issue in favor of the Bank,
but at the expense of the Borrower, standard ALTA form mortgagee title insurance
policies including endorsements, insuring the lien of the Mortgage as a first
lien on the Real Property and Improvements, free and clear of all liens
(including possible mechanic's liens, filed or unfiled) and encumbrances and
subject only to such objections and exceptions as the Bank may approve.
(vii) Property, Liability and Other Insurance. Fully
paid fire insurance policy covering risk of loss or damage to the Real Property
and Improvements due to fire and such other casualties as the Bank may require
with limits equal to one hundred percent (100%) of the full replacement cost
with such company or companies reasonably approved by the Bank and containing
mortgagee clauses in favor of the Bank in form and content reasonably
satisfactory to the Bank; fully paid flood insurance policy, if determined to be
necessary by the Bank, applicable to such portion of the Improvements as are in
the flood hazard area; rent loss insurance applicable for a period of at least
one (1) year following the occurrence of a casualty, which shall be assignable
to the Bank; and fully paid liability insurance the Borrower in amounts
reasonably acceptable to the Bank and naming the Bank as additional insured
thereunder. Receipt of the aforesaid policies or certificates shall not bar the
Bank from requiring other or additional insurance which the Bank reasonably
requires due to changed circumstances and which insurance is commercially
reasonable to obtain for real estate properties similar to the Real Property and
Improvements.
(viii) Opinion of Counsel. A written opinion of the
Borrower's counsel who shall be acceptable to the Bank, which shall be
satisfactory in form and substance to the Bank, (A) with respect to the matters
set forth in paragraphs 2(a), (b), (c), (d) and (e) of this Agreement, (B) to
the effect that the Loan is not usurious, and (C) that such counsel, based upon
a factual certificate of the Borrower included with the written opinion, is not
aware of any matters contrary to the representations and warranties of the
Borrower contained in this Agreement.
(ix) Leases. Copies of all lease agreements affecting
the Real Property and Improvements, or any part thereof, all of which shall be
in form and substance satisfactory to the Bank. In addition, the Borrower shall
furnish to the Bank an estoppel certificate and a subordination, non-disturbance
and attornment agreement, acceptable to the Bank in form and substance, with
respect to such of the existing lease agreements as the Bank may request.
(x) Current Rent Roll. A current rent roll for the
Real Property and Improvements (including commencement date, termination date
and monthly rent for each lease) in form and
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substance reasonably satisfactory to the Bank and certified as true and correct
by the chief financial officer of the Borrower.
(xi) Management Agreement. Copies of any management
agreement relating to the Real Property and Improvements, which shall be in form
and substance reasonably satisfactory to the Bank.
(xii) Financial Statements. Current and complete Form
10Q's and Form 10K's, including financial statements, and federal income tax
returns for the Borrower, which shall have been reviewed and approved by the
Bank.
(xiii) Organizational Documents. Certified copies of
the Trust Agreement and other organizational documents of the Borrower, together
with evidence that said documents have been filed of record as required by
applicable law, and certified resolutions or written consents from the
appropriate sources authorizing the transactions provided for herein, all in
form and substance reasonably satisfactory to the Bank.
(xiv) Purchase Agreement. A copy of the Purchase
Agreement and all environmental documentation referred to therein, certified as
true, correct and complete by the Borrower.
(e) Delivery of Subordination Agreement. The Bank and UM
Company shall have entered into a Subordination Agreement pursuant to which it
is agreed that the Seller Loan shall be under and subject and subordinate in
lien and priority to the payment of the Loan, on terms and conditions acceptable
to the Bank.
5. Loan Advances.
(a) On the date hereof, the Bank shall advance the full amount
of the Acquisition Portion of the Loan. A portion thereof in the amount of
$7,289,226.41 is represented by the Borrower's assumption of the Amended
Original Loans and Amended Original Loan Documents, as amended and restated in
their entirety by the Loan Documents. The balance thereof in the amount of
$1,190,773.59 is represented by an advance of that amount to or for the account
of the Borrower in payment of a portion of the purchase price for the Real
Property and Improvements.
(b) From time to time after the date hereof, the Bank shall
make advances of the Tenant Improvement Portion of the Loan with respect to New
Leases, in each case subject to the following conditions:
(i)(A) The New Lease must be executed on a standard
lease in the form attached hereto as Exhibit C and must
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provide for a term of not less than five (5) years and a gross rent (subject to
payment of electricity by the tenant) thereunder of not less than $18 per square
foot of net rentable space; (B) the New Lease must cover a portion or all of the
current Vacant Space within the Improvements; (C) advances for Tenant
Improvements shall not exceed $30 per square foot with respect to current Vacant
Space within the Improvements which constitutes unfinished space and $15 per
square foot with respect to current Vacant Space within the Improvements which
constitutes partially finished space; and (D) advances for Leasing Commissions
shall not exceed $3.78 per square foot of space covered by the New Lease.
(ii) Advances of the Tenant Improvement Portion of
the Loan shall be made to or for the benefit of the Borrower from time to time
as work progresses on the construction of the Tenant Improvements with respect
to the New Lease, but such advances shall not be more frequent than monthly and
shall be limited to ninety percent (90%) of the cost or value, whichever is
less, of the completed work in place for which such advance is made with respect
to hard costs but shall be one hundred percent (100%) of the cost or value,
whichever is less, with respect to soft costs. Unless otherwise approved by the
Bank, the remaining ten percent (10%), including any advances for Leasing
Commissions, shall be advanced only upon completion of the construction of the
Tenant Improvements with respect to the New Lease and delivery to the Bank of a
final release of lien or other proof satisfactory to the Bank that final payment
has been made for all material and labor furnished in connection with the Tenant
Improvements with respect to the New Lease.
(iii) Advances of the Tenant Improvement Portion of
the Loan shall be made as construction of the Tenant Improvements with respect
to the New Lease progresses upon written applications for payment
("Applications") by the Borrower which Applications shall be accompanied by
invoices or paid receipts of the persons or entities for whose labor or
materials payment is being sought. Applications shall be submitted only for work
completed and materials, free of any lien, encumbrance or security interest,
physically incorporated into the construction of the Tenant Improvements. Each
Application, as thus submitted, automatically shall constitute a representation
and certification by the Borrower that (A) the work done and materials supplied
to date are in strict accordance with any applicable plans and specifications,
(B) the work and materials for which payment is requested have been physically
incorporated into the construction of the Tenant Improvements, (C) the value is
as stated, (D) the work and materials conform with all applicable rules and
regulations of the governmental authorities having jurisdiction of the Real
Property, (E) payment for the work and materials described in such Application
has been made or will be made with the proceeds of the advances for which the
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Application was submitted, (F) no event has occurred which is or with the
passage of time or giving of notice or both would become an event of default
under any of the Loan Documents, and (G) each and all of the representations and
warranties set forth in paragraph 2 hereof continue to be true. The Bank
reserves the right to approve the form and content of each Application and to
verify the representations therein by an inspection of the Real Property and
Improvements. Each Application shall be subject to approval by the Bank
Consultant (as hereinafter defined).
(iv) The Bank shall have reviewed and approved the
identity of the contractor and, if applicable, the architect to be retained by
the Borrower, the plans and specifications, and budget, with respect to the
Tenant Improvements under the New Lease, each such approval not to be
unreasonably withheld or delayed.
(v) The Borrower shall have received, and the Bank
shall have reviewed and approved, all necessary and appropriate licenses,
permits and approvals, including without limitation building permits, for the
construction of the Tenant Improvements with respect to the New Lease.
(vi) The Bank shall have the right to retain an
architect or engineer of its selection to act as the Bank's consultant (the
"Bank Consultant") in connection with the construction of the Tenant
Improvements, to analyze all pertinent data relating to the construction of the
Tenant Improvements and make periodic inspections to verify the progress of
construction of the Tenant Improvements.
6. Limitation of the Bank's Liability; Indemnity.
(a) Although the Bank and its agents may inspect the course of
construction and other matters pertaining to the Tenant Improvements, such
inspections are solely for the protection of the Bank as lender, and the
Borrower hereby confirms that the Bank is not making and will not be deemed to
make any representations or warranties as to any matters pertaining to the
Tenant Improvements by reason of such inspections.
(b) The rights and benefits of this Agreement shall not inure
to the benefit of any third party, except as provided in paragraph 10(e) of this
Agreement. Notwithstanding anything to the contrary contained in this Agreement
or in any of the other Loan Documents, or any conduct or course of conduct by
the Borrower or the Bank or their respective affiliates, agents or employees,
neither this Agreement nor any such Loan Documents shall be construed as
creating any rights, claims or causes of action against the Bank in favor of any
other person or entity other than the Borrower.
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(c) Subject to the provisions of paragraph 9 hereof and only
so long as the Bank has not assumed possession and caused the same, the
Borrower, for itself and all those claiming under or through it, agrees to
protect, indemnify, defend and hold harmless the Bank, its directors, officers
and employees, from and against any and all liability, expense, or damage of any
kind or nature and from any suits, claims or demands, including reasonable legal
fees and expenses, arising out of this Agreement or in connection herewith
unless and except arising solely as a result of the Bank's gross negligence or
willful misconduct or actions of the Bank following its assumption of possession
of the Real Property and Improvements. This obligation specifically shall
survive the repayment of the Loan as to any such liability, expense, damage,
suit, claim or demand that arises, or the allegations or rights with respect
thereto which arise, prior to the repayment of the Loan.
7. Maximum Rate of Interest on Loan. Notwithstanding anything to the
contrary contained herein or in any other document executed in connection with
the Loan, the effective rate of interest on the Loan shall not exceed the
maximum effective rate of interest permitted by applicable law or regulation.
The Borrower hereby agrees to give the Bank written notice in the event that the
Borrower has actual knowledge that any interest payment made to the Bank with
respect to this Loan will cause the total interest payments collected in any one
year to be usurious under applicable law, and the Bank hereby agrees not to
collect knowingly any interest from the Borrower in the form of fees or
otherwise which will render this Loan usurious. In the event that such interest
would be usurious in the Bank's opinion, the Bank reserves the right to reduce
the interest payable by the Borrower. This provision shall survive closing
hereunder and the repayment of the Loan.
8. Defaults.
(a) Events of Default. The occurrence of any one or more of
the following events, after the expiration of any applicable notice and/or cure
period specifically provided for herein, shall, at the sole option of the Bank,
constitute an "event of default" hereunder:
(i) The Borrower shall fail to pay any regularly
scheduled installment of principal and/or interest due to the Bank under the
Note when the same shall become due and payable (including payment of the Loan
on the Maturity Date (as defined in the Note)) or the Borrower shall fail to
make any other payment due under any of the Loan Documents within fifteen (15)
days after notice thereof from the Bank;
(ii) Except as otherwise provided for herein, the
Borrower shall fail to observe or perform any of the covenants or
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agreements on its part to be observed or performed under this Agreement or under
any of the other Loan Documents within thirty (30) days after written notice
from the Bank of such non-compliance, provided that if such non-compliance
cannot reasonably be cured within such thirty day period but the Borrower
undertakes within such thirty day period and thereafter diligently pursues the
curing of such non-compliance, then the period within which the Borrower shall
cure such non-compliance shall be extended to sixty (60) days after the original
written notice from the Bank of such non-compliance;
(iii) Any representation or warranty of the Borrower
under the Note or under any of the other Loan Documents shall be untrue in any
material respect;
(iv) Any event of default, after the expiration of
any applicable notice and/or cure period specifically provided for therein,
shall occur under any of the other Loan Documents or under any documents
evidencing or securing the Seller Loan;
(v) The Borrower shall apply for or consent to the
appointment of a receiver, trustee or liquidator of itself or any of its
property, admit in writing its inability to pay its debts as they mature, make a
general assignment for the benefit of creditors, be adjudicated a bankrupt,
insolvent or file a voluntary petition in bankruptcy, or a petition or an answer
seeking reorganization or an arrangement with creditors or to take advantage of
any bankruptcy, reorganization, insolvency, readjustment of debt dissolution or
liquidation law or statute, or an answer admitting the material allegations of a
petition filed against it in any proceeding under any such law, or if action
shall be taken by the Borrower for the purpose of effecting any of the
foregoing;
(vi) Any order, judgment or decree shall be entered
by any court of competent jurisdiction, approving a petition seeking
reorganization of the Borrower or all or a substantial part of the assets of the
Borrower, or appointing a receiver, sequestrator, trustee or liquidator of the
Borrower or any of its property and such order, judgment or decree shall
continue unstayed and in effect for a period of thirty (30) days; or
(vii) The Improvements shall be materially injured or
destroyed by fire or other casualty for which the cost of restoration is not
fully insured or, if not fully insured, the Borrower has failed to deposit with
the Bank the difference between the insurance proceeds received and the cost of
restoration, or in lieu thereof, has failed to agree with the Bank to provide
such funds or, in connection with such agreement, has failed to provide the Bank
with reasonable assurances that
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such funds are available, all in accordance with the terms of the
Mortgage.
(b) Acceleration and Remedies. Upon the occurrence of any
event of default hereunder, in addition to any other rights or remedies
available to it hereunder or under any other Loan Document or at law or in
equity, subject however to the limitations set forth in paragraph 9 hereof, the
Bank may exercise any or all of the following rights and remedies in such order
and at such time or times as it may deem necessary or appropriate:
(i) declare the outstanding principal balance of the
Loan, together with all accrued and unpaid interest thereon and all other sums
due hereunder or under any of the other Loan Documents, to be immediately due
and payable in full; and/or
(ii) set off all property of the Borrower now or
hereafter at any time in its possession in any capacity whatsoever including,
but not limited to, any balance or share of any deposit, trust or agency
account, as to all of which property the Borrower hereby grants the Bank a lien
and security interest.
(c) Remedies Cumulative, etc.
(i) No right or remedy conferred upon or reserved to
the Bank under any of the Loan Documents, or with respect to any guaranty of
payment of the Loan or of performance of any of the Borrower's obligations under
any of the Loan Documents or any collateral securing the payment of the Loan
under any of the Loan Documents (such guaranty and such other collateral,
collectively, the "Collateral"), now or hereafter existing at law or in equity
or by statute or other legislative enactment, is intended to be or shall be
deemed exclusive of any other such right or remedy, and each and every such
right or remedy shall be cumulative and concurrent, and shall be in addition to
every other such right or remedy, and may be pursued singly, concurrently,
successively or otherwise, at the sole discretion of the Bank, and shall not be
exhausted by any one exercise thereof but may be exercised as often as occasion
therefore shall occur. The Bank acknowledges that there is no independent
guaranty agreement with respect to the Loan in existence on the date of this
Agreement. No act (or failure to act) of the Bank shall be deemed or construed
as an election to proceed under any one such right or remedy to the exclusion of
any other such right or remedy; furthermore, each such right or remedy of the
Bank shall be separate, distinct and cumulative and none shall be given effect
to the exclusion of any other. The failure to exercise or delay in exercising
any such right or remedy, or the failure to insist upon strict performance of
any term of any of the Loan Documents, shall not be construed as a waiver or
release of the same, or of any event of default
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thereunder, or of any obligation or liability of the Borrower thereunder.
Nothing herein, however, shall be construed to prevent the Bank from waiving any
condition, obligation or default it should so elect. In the event of such
election by the Bank, any waiver, in order to be effective, must be in writing
and signed by the Bank, and any such waiver shall be strictly limited in its
effect to the condition, obligation or default specified therein and shall not
extend to any subsequent condition, obligation or default or impair any right of
the Bank with respect thereto.
(ii) The recovery of any judgment by the Bank and/or
the levy of execution under any judgment shall not affect in any manner or to
any extent, liens or other security interests in any Collateral, or any rights,
remedies or powers of the Bank under any of the Loan Documents or with respect
to any Collateral, but such liens and security interests, and such rights,
remedies and powers of the Bank shall continue unimpaired as before. Further,
the entry of any judgment by the Bank shall not affect in any way the interest
rate payable under any of the Loan Documents on any amounts due to the Bank, but
interest shall continue to accrue on such amounts at the Default Rate (as
hereafter defined).
(iii) The Borrower hereby waives presentment, demand,
notice of nonpayment, protest, notice of protest, or other notice of dishonor,
and any and all other notices in connection with any default in the payment of,
or any enforcement of the payment of, the Loan except as may be otherwise
specifically set forth herein. To the extent permitted by law, the Borrower
waives the right to any stay of execution and the benefit of all exemption laws
now or hereafter in effect. The Borrower further waives and releases all
procedural errors, defects and imperfections in any proceedings instituted by
the Bank under the terms of any of the Loan Documents or with respect to any
Collateral.
(iv) The Borrower agrees that the Bank may release,
compromise, forbear with respect to, waive, suspend, extend or renew any of the
terms of the Loan Documents (and the Borrower hereby waives any notice of any of
the foregoing), and that the Loan Documents may be amended, supplemented or
modified by the Bank and the other signatory parties and that the Bank may
resort to any Collateral in such order and manner as it may think fit, or accept
the assignment, substitution, exchange, pledge, or release of all or any portion
of any Collateral, for such consideration, or none, as it may require, without
in any way affecting the validity of any liens upon or other security interests
in the remainder of any such Collateral (or the priority thereof or the position
of any subordinate holder of any lien or other security interest with respect
thereto); and any action taken by the Bank pursuant to the foregoing shall in no
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way be construed as a waiver or release of any right or remedy of the Bank, or
of any event of default, or of any liability or obligation of the Borrower,
under any of the Loan Documents.
(d) Default Rate. Following the occurrence of any event of
default and continuing either until such event of default is cured and that fact
acknowledged by the Bank or until the principal sum then outstanding under the
Note and all other sums payable under the Loan Documents are paid in full, the
principal sum outstanding under the Note shall bear interest at rate equal to
the annual interest rate then applicable under paragraph 1 of the Note plus four
percent (4%) per annum, which rate shall change if, when and as such interest
rate changes ("Default Rate"), and shall be secured by the Mortgage and all
other Collateral.
(e) Cost and Expenses. The Borrower shall pay upon demand all
reasonable costs and expenses (including all amounts paid to attorneys,
accountants, real estate brokers and other advisors employed by the Bank)
incurred by the Bank in the exercise of any of its rights, remedies or powers
under any of the Loan Documents, or as a secured or unsecured creditor, as the
case may be, of the Borrower in any federal or state bankruptcy proceedings, or
with respect to any Collateral with respect to such event of default, and any
amount thereof not paid promptly following demand therefor together with
interest thereon at the Default Rate from the date of such demand, shall become
part of the Loan and shall be secured by the Mortgage and all other Collateral.
In connection with and as part of the foregoing, in the event that any of the
Loan Documents is placed in the hands of an attorney for the collection of any
sum payable thereunder, the Borrower agrees to pay reasonable attorneys' fees
for the collection of the amount being claimed under such Loan Document, as well
as all costs, disbursements and allowances provided by law, the payment of which
sums shall be secured by the Mortgage and all other Collateral.
(f) Jurisdiction; Venue. The Borrower agrees that any action
or proceeding against it to enforce the Loan may be commenced in state or
federal court in Camden County in the State of New Jersey, and the Borrower
waives personal service of process and agrees that a summons and complaint
commencing an action or proceeding in any such court shall be properly served if
served by registered or certified mail in accordance with the notice provisions
set forth herein, and the Borrower expressly waives any and all defenses to an
exercise of personal jurisdiction by any such court.
(g) WAIVER OF TRIAL BY JURY. THE BORROWER HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN
RESPECT OF ANY LITIGATION BASED UPON OR ARISING OUT OF, UNDER OR IN CONNECTION
WITH THIS LOAN
25
<PAGE>
AGREEMENT, ANY OF THE OTHER LOAN DOCUMENTS, OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF THE BORROWER OR
THE BANK. THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE BANK TO MAKE THE LOAN.
9. Limited Liability of the Borrower. Except as hereinafter set forth,
the Borrower shall not have any personal liability for the payment of the Loan
or for the payment of any sum or performance of any obligation under any of the
Loan Documents, and in the event of a default under this Agreement or any of the
other Loan Documents the Bank will look solely to the Real Property and
Improvements, the rents, issues and profits thereof and any other Collateral
specifically pledged, assigned or granted by the Borrower to the Bank as
security for the Loan pursuant to this Agreement or any of the other Loan
Documents, and any judgment obtained against the Borrower shall so note by its
terms or as otherwise permissible by law. Subject to the aforesaid limitation,
nothing herein contained shall be construed to prevent the Bank from exercising
and enforcing any other remedy against the Borrower or any other person or
entity allowed at law or in equity or by any statute or by the terms of this
Agreement or any of the other Loan Documents or any other deed of trust,
mortgage, security agreement, assignment of leases and rents, guaranty or any
other security instrument of any kind now or hereafter securing payment of the
Loan. In addition, notwithstanding anything to the contrary contained herein,
the Borrower shall indemnify and hold the Bank harmless against, and shall be
personally liable and obligated to the Bank for:
(a) the completion of construction of the Tenant Improvements
in accordance with the respective deadlines therefor in the New Leases free and
clear of any and all mechanics liens and any other liens and encumbrances;
(b) the payment on a current basis of all monthly installments
of principal and interest with respect to the Acquisition Portion of the Loan
and interest with respect to the Tenant Improvement Portion of the Loan (but
excluding therefrom the entire unpaid principal balance of the Loan becoming due
as a result of maturity or acceleration of the Loan to the extent not
constituting a regular monthly installment);
(c) the principal amount of the Loan to the extent of
$3,000,000, which may be allocated between the Acquisition Portion of the Loan
and Tenant Improvement Portion of the Loan as the Bank shall determine in its
sole discretion, and which shall not be reduced by any payments on account of
the Acquisition Portion of the Loan or Tenant Improvement Portion of the Loan by
the Borrower or by any other person or entity, whether by payments in the
ordinary course or by mortgage foreclosure or otherwise; and
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<PAGE>
(d) an amount equal to all loss, liability, damage, cost and
expense suffered or incurred by the Bank in any way arising out of, resulting
from or relating to any one or more of the following: (i) any fraud or willful
material misrepresentation committed by the Borrower; (ii) any retention by the
Borrower of rental income, security deposits, or similar income of the Real
Property and Improvements after an event of default has occurred under the Loan
Documents to the extent of any such retention; (iii) any real property taxes or
assessments accrued prior to the Bank's acquisition of ownership of the Real
Property and Improvements following a default by the Borrower under the Loan;
(iv) removal or failure to replace any personal property securing the Loan,
other than in the ordinary course of the Borrower's business; (v) misapplication
of insurance or condemnation proceeds relating to the Real Property and
Improvements; (vi) failure to maintain hazard or liability insurance relating to
the Real Property and Improvements, in accordance with the Loan Documents; (vii)
the presence of any Hazardous Substances or Wastes which may affect the Real
Property and Improvements, or any misrepresentation or breach of any covenants
or indemnities by the Borrower set forth in the Loan Documents with respect to
Hazardous Substances or Wastes; (viii) any transfer of the Real Property and
Improvements or any portion thereof other than Permitted Transfers; (ix) any
indebtedness secured by a mortgage covering the Real Property and Improvements
other than the Seller Loan; (x) any bankruptcy, reorganization, insolvency,
readjustment of debt, dissolution, liquidation or receivership proceedings
instituted by or against the Borrower, unless and except to the extent that such
proceedings are withdrawn, dismissed or discharged within ninety (90) days or
unless the Bank obtains title to the Real Property and Improvements within nine
(9) months; and (xi) all fees and costs, including reasonable attorney fees,
incurred in enforcing and collecting the foregoing.
10. Miscellaneous
(a) Time of the Essence. All dates and times for the
performance of the Borrower's obligations set forth herein shall be deemed to be
of the essence of this Agreement.
(b) Broker's and Finder's Fees. The Borrower represents and
warrants that it has not dealt with or through any broker or other intermediary
in connection with the Loan except for CB Commercial and the Borrower agrees to
indemnify, defend and hold the Bank harmless from and against any loss,
liability or damage (including attorneys' fees and expenses) arising from any
claim for a brokerage fee or finder's fee in connection with the Loan, including
any claims by CB Commercial.
(c) Publicity. The Bank may, at its option and in such manner
as it may determine, announce and publicize the
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<PAGE>
source of the financing for the Real Property and Improvements at any time after
the date of this Agreement.
(d) Severability. In the event that for any reason one or more
of the provisions of this Agreement or their application to any person or
circumstance shall be held to be invalid, illegal or unenforceable in any
respect or to any extent, such provisions shall nevertheless remain valid, legal
and enforceable in all other respects and to such extent as may be permissible.
In addition, any such invalidity, illegality or unenforceability shall not
affect any other provision hereof, but this Agreement shall be construed as if
such invalid, illegal or unenforceable provision had never been contained
herein.
(e) Successors and Assigns. This Agreement inures to the
benefit of and binds the parties hereto and their respective heirs, personal
representatives, successors and assigns, as applicable, and the words "Borrower"
and "Bank" whenever occurring herein shall be deemed to include such respective
heirs, personal representatives, successors and assigns, as applicable. However,
the Borrower shall not voluntarily, or by operation of law, assign or transfer
any interest which it may have under this Agreement or convey the Real Property
and Improvements, or any part thereof, without the prior written approval of the
Bank. The Bank may assign or otherwise transfer the Loan and any or all of the
Loan Documents to any other person, and such other person shall thereupon become
vested with all of the benefits in respect thereof granted to the Bank herein or
otherwise. The Bank shall have the right to sell participations in the Loan to
any other persons or entities without the consent of or notice to the Borrower.
Without the consent of or notice to the Borrower, the Bank may disclose to any
prospective purchaser of any securities issued or to be issued by the Bank, and
any prospective or actual purchaser of any participation or other interest in
the Loan or any other loans made by the Bank to the Borrower, any financial or
other information, data or material in the Bank's possession relating to the
Borrower, the Loan or the Real Property and Improvements.
(f) Notices. All notices required or desired to be given to
either of the parties hereunder shall be in writing and shall be deemed to have
been sufficiently given for all purposes when presented personally to such party
or sent by a nationally recognized overnight courier or by certified or
registered mail, return receipt requested, to such party at its address set
forth below:
Borrower: Brandywine Realty Trust
Two Greentree Centre, Suite 100
Marlton, New Jersey 08053
Attention: Gerard H. Sweeney, President and
Chief Executive Officer
28
<PAGE>
with a
copy to: Pepper, Hamilton & Scheetz
3000 Two Logan Square
18th and Arch Streets
Philadelphia, Pennsylvania 19103
Attention: Brad A. Molotsky, Esquire
Bank: Summit Bank
1800 Chapel Avenue West
Cherry Hill, New Jersey 08002
Attention: Amy Brown
Regional Vice President
with a copy to: Miller Dunham & Doering
l515 Market Street, Suite 1300
Philadelphia, Pennsylvania l9l02
Attention: David H. Huggler, Esquire
Such notice shall be deemed to be given when received if delivered personally or
three (3) days after the date mailed if sent by a nationally recognized
overnight courier or by certified or registered mail, return receipt requested.
Any notice of any change in such address shall also be given in the manner set
forth above. Whenever the giving of notice is required, the giving of such
notice may be waived in writing by the party entitled to receive such notice.
(g) Definitions; Number and Gender. In the event the Borrower
consists of more than one person or entity, the obligations and liabilities
hereunder of each of such persons and entities shall be joint and several, and
the word "Borrower" shall mean all or some or any of them. For purposes of this
Agreement, the singular shall be deemed to include the plural and the neuter
shall be deemed to include the masculine and feminine, as the context may
require.
(h) Conflicts Between Instruments. In the event of any
conflict between the provisions of this Agreement and the provisions of any of
the other Loan Documents, the provisions of this Agreement shall prevail.
(i) Captions. The captions or headings of the paragraphs of
this Agreement are for convenience only and shall not control or affect the
meaning or construction of any of the terms or provisions of this Agreement.
(j) Renewal of Obligation. The Loan is a renewal and amendment
and restatement in its entirety of the Amended Original Loans, and is not
intended as an accord and satisfaction or novation of the Amended Original
Loans.
(k) Governing Law. This Agreement shall be governed
29
<PAGE>
by and construed in accordance with the laws of the State of New Jersey.
IN WITNESS WHEREOF, the Borrower and the Bank have executed this
Agreement on the date first above set forth.
WITNESS/ATTEST: BRANDYWINE REALTY TRUST, a Maryland Real
Estate Investment Trust
By: /s/ Gerald H. Sweeney
- ----------------------------- -------------------------------------
Name: Name: Gerald H. Sweeney
Title: Title: President/CEO
SUMMIT BANK
By: /s/ Amy Brown RVP
-------------------------------------
Amy Brown
Regional Vice President
30
<PAGE>
EXHIBIT A
ALL that certain land and premises situate in the Township of Cherry Hill,
County of Camden and the State of New Jersey, bounded and described as follows:
TRACT #1-BEGINNING at a point in the Southerly right of way line of New Jersey
State Highway Route #38, said point being corner formed by the intersection of
the said line of New Jersey State Highway Route #38 with the Easterly right of
way line of Third Avenue (50 feet wide), and extending; thence along the said
right of way line of New Jersey State Highway Route #38; thence
(1) South 80 degrees 11 minutes 00 seconds East, 19.53 feet to an angle point
common with the Southwesterly right of way line of the access road (ramp from
New Jersey State Highway Route #38 to Haddonfield Road), and extending; thence
along the said right of way line to the access road; thence
(2) South 45 degrees 29 minutes 39 seconds East, 336.69 feet to an angle point,
and extending; thence along the right of way line; thence
(3) South 21 degrees 17 minutes 18 seconds East, 120.52 feet to a point formed
by the intersection of said access road with the Westerly right of way line of
Haddonfield-Sorrell Horse Road (formerly Stoy Landing Road) a/k/a Camden County
Route #644 (formerly 66 feet wide), and extending; thence along the said right
of way line of Haddonfield-Sorrell House Road; thence
(4) South 09 degrees 49 minutes 00 seconds West, 283.83 feet to an angle point,
and extending; thence along the said right of way line of Haddonfield-Sorrell
Horse Road; thence
(5) South 24 degrees 17 minutes 14 seconds West, 96.05 feet to an angle point,
and extending; thence along the said right of way line of Haddonfield-Sorrell
Road; thence
(6) South 09 degrees 49 minutes 00 seconds West, 257.21 feet to a point of
curvature and extending; thence
(7) at the point of curvature in the Westerly right of way line of
Haddonfield-Sorrell Horse Road, curving to the right having a radius of 30 feet,
and an arc length of 57.17 feet to a point of tangency connecting the
Northeasterly right of way line of Chapel Avenue (50 feet wide) a/k/a Camden
County Route #626 with the said right of way line of Haddonfield-Sorrell Horse
Road, and extending; thence along the said right of way line of Chapel Avenue;
thence
(8) North 61 degrees 00 minutes 11 seconds West, 108.14 feet to an angle point,
and extending; thence along the said right of way line of Chapel Avenue; thence
<PAGE>
(9) North 52 degrees 03 minutes 39 seconds west, 43.50 feet to a corner in point
common with Lot 3, Block 176.01 on the Current Tax Map of the Township of Cherry
Hill, and extending; thence along a line common with Lot 3, Block 176.01; thence
(10) North 09 degrees 49 minutes 00 seconds East, 178.31 feet to a corner point
common with Lots 2 and 3, Block 176.01, said Tax Map and lands now or formerly
of Chapel Printing, and extending; thence along a line common with said Lot 2;
thence
(11) South 80 degrees 11 minutes 00 seconds East, 29.43 feet to a corner point,
and extending; thence along a line common with said Lot 2; thence
(12) North 09 degrees 49 minutes 00 seconds East, 52.21 feet to a corner point,
and extending; thence along a line common with said Lot 2; thence
(13) North 80 degrees 11 minutes 00 seconds West, 183.71 feet to a corner point
common with the Easterly right of way line of Third Avenue (50 feet wide), and
extending; thence
(14) North 09 degrees 49 minutes 00 seconds East, 670.93 feet to a corner point
common with the Southerly right of way line of New Jersey State Highway Route
#38 and being the place of beginning.
BEING shown and designated as Lot 1, Block 176.01, Plate 18 on the Current Tax
Map of the Township of Cherry Hill.
<PAGE>
EXHIBIT B
ALL that certain land and premises situate in the Township of Cherry Hill,
County of Camden and the State of New Jersey, bounded and described as follows:
TRACT #2-BEGINNING at a point formed by the intersection of the Northeasterly
line of Chapel Avenue (width varies) with the Southeasterly line of Third Avenue
(50 feet wide) and extending; thence
(1) North 09 degrees 49 minutes 01 seconds East, along the Southeasterly line of
Third Avenue, 142.67 feet to a point in the division line between existing Tax
Lots 1 and 2, Block 176.01; thence
(2) South 80 degrees 10 minutes 59 seconds East, along said division line,
183.71 feet to point concrete monument in the division line between said Tax
Lots; thence
(3) South 09 degrees 49 minutes 01 seconds West, along said division line, 52.21
feet to a set iron pin in the division line between said Tax Lots; thence
(4) North 80 degrees 10 minutes 59 seconds West, along said division line, 29.43
feet to a found iron pin for a corner in the division line between Tax Lots 1, 2
and 3, Block 176.01; thence
(5) South 09 degrees 49 minutes 01 seconds West along the division line between
Tax Lots 1 and 3, Block 176.01, 180.26 feet to a point in the Northeasterly line
of Chapel Avenue; thence
(6) North 53 degrees 04 minutes 12 seconds West, along said line of Chapel
Avenue, 163.20 feet to an angle point in same; thence
(7) North 20 degrees 28 minutes 36 seconds West, along same, 17.86 feet to the
point and place of beginning.
BEING shown and designated as Lots 2 and 3, Block 176.01, Plate 18 on the
Township of Cherry Hill Tax Map.
<PAGE>
EXHIBIT C
Form of Lease Agreement
33
<PAGE>
EXHIBIT C
The Arthur Anderson Lease shall serve as the agreed
upon form lease.
<PAGE>
Exhibit 99.8 Amended and Restated
Promissory Note from the
Trust to SB
AMENDED AND RESTATED PROMISSORY NOTE
$9,777,140 Cherry Hill, New Jersey
July 19, 1996
FOR VALUE RECEIVED, BRANDYWINE REALTY TRUST, a Maryland real estate
investment trust with an office at Two Greentree Centre, Suite 100, Marlton, New
Jersey 08053 ("Maker"), promises to pay to the order of SUMMIT BANK, a New
Jersey state bank (formerly known as United Jersey Bank/South, N.A. and United
Jersey Bank) with an office at 1800 Chapel Avenue West, Cherry Hill, New Jersey
08002 ("Payee"), at such office of Payee or at such other place as Payee may
designate from time to time in writing, the principal sum of Nine Million Seven
Hundred Seventy-seven Thousand One Hundred Forty Dollars ($9,777,140) (or so
much thereof as has been advanced by Payee to or for the benefit of Maker
pursuant to a certain amended and restated loan agreement dated this date by and
between Maker and Payee (the "Loan Agreement")) lawful money of the United
States of America, together with interest thereon from the date hereof at the
rates hereinafter provided, and both payable as hereinafter provided. This Note
evidences an amended and restated loan ("Loan") being made by Payee to Maker
pursuant to the terms of the Loan Agreement, and reference thereto is made for
the background of and basis for the Loan. Capitalized terms not otherwise
defined herein shall have the meanings given them in the Loan Agreement.
1. Interest Rate.
(a) The Acquisition Portion of the Loan shall bear interest on
the unpaid principal balance thereof outstanding from time to time at a fixed
annual rate of eight percent (8%). The Tenant Improvement Portion of the Loan
shall bear interest on the unpaid principal balance thereof outstanding from
time to time at an annual rate at all times equal to Payee's prime interest
rate, as announced from time to time by Payee ("Prime Rate"), plus one percent
(1%), such rate to change when and as the Prime Rate changes. It is understood
that the Prime Rate is not necessarily the most favorable interest rate offered
by Payee and that Payee prices loans at, above and below the Prime Rate.
(b) The annual interest rate shall be calculated on the basis
of a 360 day year and the actual number of days elapsed.
(c) Notwithstanding anything to the contrary contained
herein or in any other document executed in connection with the
1
<PAGE>
Loan, the effective rate of interest hereunder shall not exceed the maximum
effective rate of interest permitted by applicable law or regulation. Maker
hereby agrees to give Payee written notice in the event Maker has actual
knowledge that any interest payment made to Payee with respect to this Note will
cause the total interest payments collected in any one year to be usurious under
applicable law, and Payee hereby agrees not to collect knowingly any interest
from Maker in the form of fees or otherwise which will render the Loan usurious.
In the event that such interest would be usurious in Payee's opinion, Payee
reserves the right to reduce the interest payable by Maker. This provision shall
survive the repayment of this Note.
2. Payment Terms.
(a) (i) With respect to the Acquisition Portion of the Loan,
the unpaid principal balance thereof, together with interest thereon at the rate
applicable thereto under paragraph 1(a) hereof, shall be payable in monthly
installments beginning on August 19, 1996 and continuing on the same day of each
successive calendar month thereafter, each monthly installment to be in the
amount of Sixty-seven Thousand Eight Hundred Nine Dollars and Twenty-nine Cents
($67,809.29), which is based upon the stated principal amount of the Acquisition
Portion of the Loan, the interest rate applicable thereto pursuant to paragraph
1(a) hereof and a level payment direct reduction amortization schedule with a
term of 22 years and 6 months.
(ii) With respect to the Tenant Improvement Portion of the
Loan, interest only on the unpaid principal balance thereof shall be payable in
monthly installments on the nineteenth (19th) day of each month, beginning on
the first such date following the first advance of the Tenant Improvement
Portion of the Loan and continuing on the same day of each successive calendar
month thereafter.
(iii) The unpaid principal balance of this Note then
outstanding (including the Acquisition Portion of the Loan and the Tenant
Improvement Portion of the Loan) together with all accrued and unpaid interest
shall become due and payable on January 1, 1999 ("Maturity Date").
(b) Maker shall have the right at any time to prepay all or
any portion of the unpaid principal balance of this Note, provided that:
(i) There shall be a prepayment penalty or premium
with respect to any prepayment of the Acquisition Portion of the Loan in an
amount equal to one percent (1%) of the amount being prepaid; provided, however,
that there shall be no such
2
<PAGE>
prepayment penalty or premium with respect to any prepayment (A) resulting from
Payee's disapproval of any merger or material change in the ownership of Maker
under paragraph 3(i) of the Loan Agreement, (B) resulting from the application
of insurance or condemnation proceeds pursuant to paragraphs 6 and 7,
respectively, of the Mortgage or (C) resulting from an acceleration of the
indebtedness evidenced by this Note pursuant to paragraph 10 hereof, and there
shall be no prepayment penalty or premium with respect to any prepayment of the
Tenant Improvement Portion of the Loan.
(ii) Any prepayment, whether voluntary or
involuntary, shall be applied first to any accrued and unpaid interest under the
Acquisition Portion of the Loan or Tenant Improvement Portion of the Loan,
whichever is the subject of such prepayment, up to the date of such prepayment
and then to any other sums which may be payable to Payee under the Loan
Documents up to the date of such prepayment and then to the outstanding
principal balance of the Acquisition Portion of the Loan or Tenant Improvement
Portion of the Loan, whichever is the subject of such prepayment, any such
prepayment applied to principal shall be applied to the principal portions of
installments due in the inverse order of their maturity, and the acceptance of
any such prepayment when there is an event of default in existence under any of
the Loan Documents shall not constitute a waiver, release or accord and
satisfaction thereof or of any rights with respect thereto by Payee.
3. Security. This Note, and the due performance by Maker of all of its
obligations hereunder, is secured by, inter alia, (a) an amended and restated
mortgage and security agreement ("Mortgage") covering certain real property
located at 457 Haddonfield Road and 1700 Chapel Avenue, both in Cherry Hill
Township, Camden County, New Jersey ("Real Property"), and any and all
improvements now existing or hereafter constructed thereon ("Improvements"),
which Mortgage is being executed this date and shall be recorded forthwith, (b)
an amended and restated assignment of all of Maker's right, title and interest
in and to any and all present and future leases affecting the Real Property and
Improvements ("Assignment of Leases and Rents"), (c) an amended and restated
assignment of all of Maker's right, title and interest in and to all
construction contracts, architect's agreements, other contracts and agreements,
and any and all licenses, permits and approvals relating to the construction of
the Tenant Improvements, and all other documents and rights relating to the
construction of the Tenant Improvements ("Assignment of Contracts and Permits"),
and (d) security interests in certain personal property of Maker. Reference is
hereby made to the Loan Agreement and Mortgage for a full description of the
Real Property and Improvements and the
3
<PAGE>
collateral pledged pursuant thereto, and the terms upon which this Note is
secured.
This Note, the Loan Agreement, the Mortgage, the Assignment of Leases
and Rents, the Assignment of Contracts and Permits, and any other document
executed and delivered in connection with the Loan are hereinafter referred to
individually as a "Loan Document" and collectively as the "Loan Documents." Any
collateral securing any of Maker's obligations under any of the Loan Documents
are hereinafter referred to collectively as the "Collateral."
4. Late Charge. In the event that any payment of principal or interest
due to Payee under this Note shall not be paid when due and shall remain unpaid
in excess of ten (10) days after the due date, in addition to and not in
limitation of any other rights or remedies which Payee may have in respect
thereof under any of the Bank Loan Documents or in respect of any Collateral,
Maker shall pay Payee on demand a "late charge" computed at the lesser of (a)
the rate of five cents ($.05) for each dollar (or part thereof) of any principal
or interest amount not paid within ten (10) days after its due date or (b) the
maximum amount or rate permitted by law, in order to cover the extra expense and
inconvenience to Payee in ensuring payment of such delinquent amount. Maker
acknowledges that its failure to pay any amount due under this Note within such
ten (10) day period will result in Payee incurring additional expense in
servicing the Bank Loan, the loss of the use of the money due and frustration to
Payee in meeting its loan commitments, that the damages to Payee in connection
with such late payment are extremely difficult and impractical to ascertain, and
that a sum equal to five cents ($.05) for each dollar which is not paid within
such ten (10) day period, subject to the foregoing limitation, is a reasonable
estimate of the damages incurred by Payee in connection with any such late
payment. The amount of any such "late charge" not paid promptly following demand
therefor shall be deemed outstanding and payable pursuant to this Note and
secured by the Mortgage.
5. Events of Default. In addition to any other event referred to
herein, the occurrence of which, by the terms hereof, constitutes an event of
default hereunder, the occurrence of any one or more of the following events,
after the expiration of any applicable notice and/or cure period specifically
provided for herein, shall constitute an "event of default" hereunder:
(a) Maker shall fail to pay any regularly scheduled
installment of principal and/or interest due to Payee under this Note when the
same shall become due and payable (including payment of the Loan on the Maturity
Date) or Maker shall fail to
4
<PAGE>
make any other payment due under any of the Loan Documents within fifteen (15)
days after notice thereof from Payee;
(b) Except as otherwise provided for in this Note, Maker shall
fail to observe or perform any of the covenants or agreements on its part to be
observed or performed under this Note or under any of the other Loan Documents
within thirty (30) days after written notice from Payee of such non-compliance,
provided that if such non-compliance cannot reasonably be cured within such
thirty day period but the Maker undertakes within such thirty day period and
thereafter diligently pursues the curing of such non-compliance, then the period
within which the Maker shall cure such non-compliance shall be extended to sixty
(60) days after the original written notice from the Payee of such
non-compliance;
(c) Any representation or warranty of Maker under this Note or
under any of the other Loan Documents shall be untrue in any material respect;
(d) Any event of default, after the expiration of any
applicable notice and/or cure period specifically provided for therein, shall
occur under the terms of any of the other Loan Documents;
(e) Maker shall apply for or consent to the appointment of a
receiver, trustee or liquidator of itself or any of its property, admit in
writing its inability to pay its debts as they mature, make a general assignment
for the benefit of creditors, be adjudicated a bankrupt, insolvent or file a
voluntary petition in bankruptcy, or a petition or an answer seeking
reorganization or an arrangement with creditors or to take advantage of any
bankruptcy, reorganization, insolvency, readjustment of debt, dissolution or
liquidation law or statute, or an answer admitting the material allegations of a
petition filed against it in any proceeding under any such law, or if action
shall be taken by Maker for the purpose of effecting any of the foregoing;
(f) Any order, judgment or decree shall be entered by any
court of competent jurisdiction, approving a petition seeking reorganization of
Maker or all or a substantial part of the assets of Maker or appointing a
receiver, sequestrator, trustee or liquidator of Maker or any of its property,
and such order, judgment or decree shall continue unstayed and in effect for any
period of thirty (30) days.
6. Remedies. Upon the occurrence of any event of default, then the
entire unpaid principal sum hereunder plus all interest
5
<PAGE>
accrued thereon plus all other sums due and payable to Payee under the Loan
Documents shall, at the option of Payee, become due and payable immediately
without presentment, demand, notice of nonpayment, protest, notice of protest or
other notice of dishonor, all of which are hereby expressly waived by Maker. In
addition to the foregoing, upon the occurrence of any event of default, subject
however to the limitations set forth in paragraph 11 hereof, Payee may forthwith
exercise singly, concurrently, successively or otherwise any and all rights and
remedies available to Payee under any of the Loan Documents or with respect to
any Collateral, or available to Payee by law, equity, statute or otherwise.
7. Remedies Cumulative.
(a) No right or remedy conferred upon or reserved to Payee
under any of the Loan Documents, or with respect to any Collateral, or now or
hereafter existing at law or in equity or by statute or other legislative
enactment, is intended to be exclusive of any other right or remedy, and each
and every such right or remedy shall be cumulative and concurrent, and shall be
in addition to every other such right or remedy, and may be pursued singly,
concurrently, successively or otherwise, at the sole discretion of Payee, and
shall not be exhausted by any one exercise thereof but may be exercised as often
as occasion therefor shall occur. No act of Payee shall be deemed or construed
as an election to proceed under any one such right or remedy to the exclusion of
any other such right or remedy; furthermore, each such right or remedy of Payee
shall be separate, distinct and cumulative and none shall be given effect to the
exclusion of any other. The failure to exercise or delay in exercising any such
right or remedy, or the failure to insist upon strict performance of any term of
any of the Loan Documents, shall not be construed as a waiver or release of the
same, or of any event of default thereunder, or of any obligation or liability
of Maker thereunder.
(b) The recovery of any judgment by Payee and/or the levy of
execution under any judgment upon any Collateral shall not affect in any manner
or to any extent the lien of the Mortgage upon, or any security interest under
the Loan Agreement in such Collateral, or any rights, remedies or powers of
Payee under any of the Loan Documents or with respect to any Collateral, but
such lien and such security interest, and such rights, remedies and power of
Payee shall continue unimpaired as before. Further, the exercise by Payee of its
rights and remedies and the entry of any judgment by Payee shall not affect in
any way the interest rate payable hereunder or under any of
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the other Loan Documents on any amounts due to Payee but interest shall continue
to accrue on such amounts at the Default Rate (as hereinafter defined).
(c) Maker hereby waives presentment, demand, notice of
nonpayment, protest, notice of protest or other notice of dishonor, and except
as may be stated herein any and all other notices in connection with any default
in the payment of, or any enforcement of the payment of, all amounts due under
the Loan Documents except as may be specifically set forth herein or therein. To
the extent permitted by law, Maker waives the right to any stay of execution and
the benefit of all exemption laws now or hereafter in effect. Maker further
waives and releases all procedural errors, defects and imperfections in any
proceedings instituted by Payee under the terms of any Loan Document or with
respect to any Collateral.
(d) Maker agrees that Payee may release, compromise, forbear
with respect to, waive, suspend, extend or renew any of the terms of the Loan
Documents (and Maker hereby waives any notice of any of the foregoing), and that
the Loan Documents may be amended, supplemented or modified by Payee and the
other signatory parties and that Payee may resort to any Collateral in such
order and manner as it may think fit, or accept the assignment, substitution,
exchange, pledge, or release of all or any portion of any Collateral, for such
consideration, or none, as it may require, without in any way affecting the
validity of any liens over or other security interest in the remainder of any
such Collateral (or the priority thereof or the position of any subordinate
holder of any lien or other security interest with respect thereto); and any
action taken by Payee pursuant to the foregoing shall in no way be construed as
a waiver or release of any right or remedy of Payee, or of any event of default,
or of any liability or obligation of the Maker, under any of the Loan Documents.
(e) Maker agrees that any action or proceeding against it to
enforce the Note may be commenced in state or federal court in Camden County in
the State of New Jersey, and Maker waives personal service of process and agrees
that a summons and complaint commencing an action or proceeding in any such
court shall be properly served if served by registered or certified mail in
accordance with the notice provisions set forth herein and Maker expressly
waives any and all defenses to an exercise of personal jurisdiction by any such
court.
(f) MAKER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY
WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION
BASED UPON OR ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS NOTE OR ANY OF
THE OTHER LOAN DOCUMENTS
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OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR
WRITTEN) OR ACTIONS OF MAKER OR PAYEE. THIS PROVISION IS A MATERIAL INDUCEMENT
FOR PAYEE TO MAKE THE LOAN.
8. Default Rate. Following the occurrence of any event of default and
continuing either until such event of default is cured and that fact
acknowledged by the Payee or until the principal sum then outstanding hereunder
and all other sums payable under the Loan Documents are paid in full, the
principal sum outstanding hereunder shall bear interest at rate equal to the
annual interest rate then applicable under paragraph 1 hereof plus four percent
(4%) per annum, which rate shall change if, when and as such interest rate
changes ("Default Rate"), and shall be secured by the Mortgage and all other
Collateral.
9. Costs and Expenses. Following the occurrence of any event of
default, Maker shall pay upon demand all reasonable costs and expenses
(including all reasonable amounts paid to attorneys, accountants, real estate
brokers and other advisors employed by Payee and/or to any contractors for labor
and materials), incurred by Payee in the exercise of any of its rights, remedies
or powers under any of the Loan Documents or with respect to any Collateral with
respect to such event of default, and any amount thereof not paid promptly
following demand therefor shall be added to the principal sum hereunder and
shall bear interest at the Default Rate from the date of such demand until paid
in full, and shall be secured by the Mortgage and all other Collateral. In
connection with and as part of the foregoing, in the event that any of the Loan
Documents is placed in the hands of an attorney for the collection of any sum
payable thereunder, Maker agrees to pay reasonable attorneys' fees for the
collection of the amount being claimed under the Loan Document, as well as all
costs, disbursements and allowances provided by law, the payment of which sums
shall be secured by the Mortgage and all other Collateral. Nothing in this
paragraph 9 shall limit the obligation of Maker to pay any and all costs and
expenses for which Maker is otherwise liable under any of the Loan Documents.
10. Mortgage Taxes, etc. Maker shall pay the cost of any revenue, tax
or other stamps now or hereafter required by the laws of the State of New Jersey
or the United States to be affixed to this Note or the Mortgage and if any taxes
are imposed under the laws of the State of New Jersey or the United States with
respect to debts secured by a mortgage, or with respect to evidences of
indebtedness so secured, Maker shall pay or reimburse Payee upon demand the
amount of such taxes without credit against any indebtedness by this Note. If
Maker does not
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or may not do so, Payee may at its option accelerate the indebtedness evidenced
by this Note to maturity as in the case of default by Maker.
11. Limited Liability of Maker. Except as hereinafter set forth, Maker
shall not have any personal liability for the payment of the Loan or for the
payment of any sum or performance of any obligation under any of the Loan
Documents, and in the event of a default under this Note or any of the other
Loan Documents Payee will look solely to the Real Property and Improvements, the
rents, issues and profits thereof and any other Collateral specifically pledged,
assigned or granted by Maker to Payee as security for the Loan pursuant to this
Note or any of the other Loan Documents, and any judgment obtained against Maker
shall so note by its terms or as otherwise permissible by law. Subject to the
aforesaid limitation, nothing herein contained shall be construed to prevent
Payee from exercising and enforcing any other remedy against Maker or any other
person or entity allowed at law or in equity or by any statute or by the terms
of this Note or any of the other Loan Documents or any other deed of trust,
mortgage, security agreement, assignment of leases and rents, guaranty or any
other security instrument of any kind now or hereafter securing payment of the
Loan. In addition, notwithstanding anything to the contrary contained herein,
Maker shall indemnify and hold Payee harmless against, and shall be personally
liable and obligated to Payee for:
(a) the completion of construction of the Tenant Improvements
in accordance with the respective deadlines therefor in the New Leases free and
clear of any and all mechanics liens and any other liens and encumbrances;
(b) the payment on a current basis of all monthly installments
of principal and interest with respect to the Acquisition Portion of the Loan
and interest with respect to the Tenant Improvement Portion of the Loan (but
excluding therefrom the entire unpaid principal balance of the Loan becoming due
as a result of maturity or acceleration of the Loan to the extent not
constituting a regular monthly installment);
(c) the principal amount of the Loan to the extent of
$3,000,000, which may be allocated between the Acquisition Portion of the Loan
and Tenant Improvement Portion of the Loan as Payee shall determine in its sole
discretion, and which shall not be reduced by any payments on account of the
Acquisition Portion of the Loan or Tenant Improvement Portion of the Loan by
Maker or by any other person or entity, whether by payments in the ordinary
course or by mortgage foreclosure or otherwise; and
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(d) an amount equal to all loss, liability, damage, cost and
expense suffered or incurred by Payee in any way arising out of, resulting from
or relating to any one or more of the following: (i) any fraud or willful
material misrepresentation committed by Maker; (ii) any retention by Maker of
rental income, security deposits, or similar income of the Real Property and
Improvements after an event of default has occurred under the Loan Documents to
the extent of any such retention; (iii) any real property taxes or assessments
accrued prior to Payee's acquisition of ownership of the Real Property and
Improvements following a default by Maker under the Loan; (iv) removal or
failure to replace any personal property securing the Loan, other than in the
ordinary course of Maker's business; (v) misapplication of insurance or
condemnation proceeds relating to the Real Property and Improvements; (vi)
failure to maintain hazard or liability insurance relating to the Real Property
and Improvements, in accordance with the Loan Documents; (vii) the presence of
any Hazardous Substances or Wastes which may affect the Real Property and
Improvements, or any misrepresentation or breach of any covenants or indemnities
by Maker set forth in the Loan Documents with respect to Hazardous Substances or
Wastes; (viii) any transfer of the Real Property and Improvements or any portion
thereof other than Permitted Transfers; (ix) any indebtedness secured by a
mortgage covering the Real Property and Improvements other than the Seller Loan;
(x) any bankruptcy, reorganization, insolvency, readjustment of debt,
dissolution, liquidation or receivership proceedings instituted by or against
Maker, unless and except to the extent that such proceedings are withdrawn,
dismissed or discharged within ninety (90) days or unless Payee obtains title to
the Real Property and Improvements within nine (9) months; and (xi) all fees and
costs, including reasonable attorney fees, incurred in enforcing and collecting
the foregoing.
12. Severability. In the event that for any reason one or more of the
provisions of this Note or their application to any person or circumstance shall
be held to be invalid, illegal or unenforceable in any respect or to any extent,
such provisions shall nevertheless remain valid, legal and enforceable in all
such other respects and to such extent as may be permissible. In addition, any
such invalidity, illegality or unenforceability shall not affect any other
provisions of this Note, but this Note shall be construed as if such invalid,
illegal or unenforceable provision had never been contained herein.
13. Successors and Assigns. This Note inures to the benefit of Payee
and binds Maker, and their respective successors and assigns, and the words
"Payee" and "Maker" whenever occurring herein shall be deemed and construed to
include such respective successors and assigns, as applicable.
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14. Notices. All notices required to be given to any of the parties
hereunder shall be in writing and shall be deemed to have been sufficiently
given for all purposes when presented personally to such party or sent by a
nationally recognized overnight courier or by certified or registered mail,
return receipt requested, to such party at its address set forth below:
Maker: Brandywine Realty Trust
Two Greentree Centre, Suite 100
Marlton, New Jersey 08053
Attention: Gerard H. Sweeney, President and
Chief Executive Officer
with a
copy to: Pepper, Hamilton & Scheetz
3000 Two Logan Square
18th and Arch Streets
Philadelphia, Pennsylvania 19103
Attention: Brad A. Molotsky, Esquire
Payee: Summit Bank
1800 Chapel Avenue West
Cherry Hill, New Jersey 08002
Attention: Amy Brown
Regional Vice President
with a
copy to: Miller Dunham & Doering
1515 Market Street, 13th Floor
Philadelphia, Pennsylvania l9l02
Attention: David H. Huggler, Esquire
Such notice shall be deemed to be given when received if delivered personally,
or three (3) days after the date mailed if sent by a nationally recognized
overnight courier or by certified or registered mail, return receipt requested.
Any notice of any change in such address shall also be given in the manner set
forth above. Whenever the giving of notice is required, the giving of such
notice may be waived in writing by the party entitled to receive such notice.
15. Definitions; Number and Gender. In the event Maker consists of more
than one person or entity, the obligations and liabilities hereunder of each of
such persons and entities shall be joint and several and the word "Maker" shall
mean all or some or any of them. For purposes of this Note, the singular shall
be deemed to include the plural and the neuter shall be deemed to include the
masculine and feminine, as the context may require.
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The references herein to the Loan Documents or any one of them shall include any
supplements to or any amendments of or restatements of such Loan Documents or
any one of them.
16. Incorporation by Reference. All of the terms and provisions of the
Loan Documents, to the extent not inconsistent herewith, are hereby incorporated
herein by reference.
17. Captions. The captions or headings of the paragraphs in this Note
are for convenience only and shall not control or affect the meaning or
construction of any of the terms or provisions of this Note.
18. Governing Law. This Note shall be governed by and construed in
accordance with the laws of the State of New Jersey.
IN WITNESS WHEREOF, Maker has executed this Promissory Note in Cherry
Hill, New Jersey the day and year first above written.
WITNESS/ATTEST: BRANDYWINE REALTY TRUST, a Maryland Real
Estate Investment Trust
XXXXXX By: /s/ Gerard H. Sweeney
- ------------------------------ -------------------------------------
Name: Name: Gerard H. Sweeney
Title: Title:
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Exhibit 99.0 Amended and Restated
Mortgage from the Trust
to SB
AMENDED AND RESTATED MORTGAGE AND SECURITY AGREEMENT
THIS AMENDED AND RESTATED MORTGAGE AND SECURITY AGREEMENT ("Mortgage
and Security Agreement" or "Mortgage") made this __ day of July, 1996 by
BRANDYWINE REALTY TRUST, a Maryland real estate investment trust with an office
at Two Greentree Centre, Suite 100, Marlton, New Jersey 08053 ("Mortgagor"), in
favor of SUMMIT BANK, a New Jersey state bank (formerly known as United Jersey
Bank/South, N.A. and United Jersey Bank) with an office at 1800 Chapel Avenue
West, Cherry Hill, New Jersey 08002 ("Mortgagee").
Mortgagor and Mortgagee have entered into an Amended and Restated Loan
Agreement dated this date ("Loan Agreement") in order to set forth the terms and
conditions of an amended and restated loan from Mortgagee to Mortgagor ("Loan").
The Loan is evidenced by an Amended and Restated Promissory Note dated this date
("Note") in the stated principal amount of Nine Million Seven Hundred
Seventy-seven Thousand One Hundred Forty Dollars ($9,777,140) executed by
Mortgagor and made payable to the order of Mortgagee. The terms and conditions
of the Loan Agreement and Note are incorporated herein by reference, and
reference to the Loan Agreement is made for the background of and basis for the
Loan. Capitalized terms not otherwise defined herein shall have the meanings
given them in the Loan Agreement.
The Loan Agreement, the Note, this Mortgage and Security Agreement, and
any other document executed and delivered in connection with the Loan are
sometimes individually referred to herein as a "Loan Document" and collectively
as the "Loan Documents," and any guaranty of, and any other collateral securing
any of Mortgagor's obligations under any of the Loan Documents are collectively
referred to herein as "Collateral."
NOW THIS MORTGAGE AND SECURITY AGREEMENT WITNESSETH, that in
consideration of the aforesaid principal sum and as security for the payment
thereof with interest as aforesaid, together with all other sums recoverable by
Mortgagee under the terms of the Loan Documents, together with all existing and
future liabilities of Mortgagor to Mortgagee under the Loan Documents (said
indebtedness, interest and all other sums and liabilities are hereinafter
collectively referred to as the "Aggregate Debt"), and as security for the due
and timely performance by Mortgagor of all of the other provisions of the Loan
Documents, and intending to be legally bound hereby, Mortgagor hereby GRANTS,
BARGAINS, SELLS, CONVEYS, ASSIGNS, TRANSFERS, RELEASES, PLEDGES and MORTGAGES to
Mortgagee all that certain real property located
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at 457 Haddonfield Road, constituting Block 176.01, Lot 1, and at 1700 Chapel
Avenue, constituting Block 176.01, Lots 2 and 3, both in Cherry Hill Township,
Camden County, New Jersey, as more fully described in Exhibit A attached hereto
and made a part hereof ("Real Property");
TOGETHER WITH all right, title and interest of Mortgagor in and to the
following property rights and interests, which Mortgagor hereby assigns to
Mortgagee until the Aggregate Debt is paid (the Real Property together with the
following property being hereinafter collectively called the "Mortgaged
Property"):
(a) all buildings and other improvements now or hereafter
located on the Real Property including the seven (7) story office building
located thereon containing approximately 121,737 net rentable square feet
("Improvements");
(b) all streets, lanes, alleys, passages, ways, water courses,
easements, rights, liberties, privileges, air rights, development rights, oil
and gas rights, water rights, water stock, tenements, hereditaments and
appurtenances whatsoever thereunto belonging to or in any way made appurtenant
hereafter, and the reversions and remainder, with respect thereto
("Appurtenances");
(c) all machinery, apparatus, equipment, furniture,
furnishings, fixtures, inventory, goods, appliances and other property of every
kind and nature whatsoever, together with replacements thereof and accessories,
parts or accessions thereto, owned by Mortgagor or in which Mortgagor has or
shall have an interest related specifically to the Real Property, and whether or
not now or hereafter located on the Real Property, and any and all proceeds of
any of the foregoing ("Equipment");
(d) all building materials, building machinery and building
equipment delivered on site to the Real Property during the course of, or in
connection with, the construction of, or reconstruction of, or remodeling of any
building and improvements located on the Real Property from time to time during
the term of this Mortgage and Security Agreement ("Building Equipment");
(e) all general intangibles relating to the development or use
of the Real Property, including but not limited to all licenses, permits and
agreements from or with all boards, agencies, departments, public utilities,
governmental or otherwise, all names under which or by which the Real Property
or Improvements may at any time be operated or known and all rights to carry on
business under any such names or any variations thereof, all trademarks and
goodwill in any way relating to the Real Property, and all documents of
membership in any owners or
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members association or similar group having responsibility for managing or
operating any portion or all of the Real Property ("Intangibles");
(f) all awards or payments, including interest thereon, which
may be made with respect to the Real Property and Improvements, whether from the
exercise of the right of eminent domain (including any transfer made in lieu of
the exercise of said right), or for any other injury to or decrease in the value
of the Real Property or Improvements including, without limitation, all awards
or payments of estimated compensation, all damages to the Real Property or
Improvements resulting from any taking, all machinery and equipment dislocation
expenses, all settlement amounts, and all apportionments of taxes ("Awards");
(g) all insurance policies covering the Real Property or
Improvements and all proceeds of any unearned premiums on any such insurance
policies including, without limitation, the right to receive and apply the
proceeds of any insurance, judgments, or settlements made in lieu thereof, for
damage to the Real Property or Improvements ("Insurance Policies");
(h) all leases, agreements of sale and other agreements
affecting the use or occupancy of any portion or all of the Real Property or
Improvements, whether heretofore or hereafter executed and all rights of
Mortgagor to payment under any such lease or agreement ("Leases and
Agreements");
(i) all rents, receipts, issues, profits and other income of
any and all kinds (including deposits) received or receivable and due or to
become due from the sale or lease of any property, goods or materials located on
the Real Property or from the rendering of services at the Real Property
including, but not limited to (i) the lease or sale of all or a portion of the
Real Property or Improvements, or (ii) the operation of any income-producing
facility on the Real Property or Improvements (all of such proceeds, receipts
and income are hereinafter referred to as the "Income and Rents" and all such
rights are hereinafter referred to as the "Accounts Receivable");
(j) any securities or guaranties held by Mortgagor with
respect to any of the Intangibles, Awards, Leases or Accounts Receivable, and
any notes, drafts, acceptances, chattel paper, documents or other instruments
evidencing the same ("Securities");
(k) all Loan funds held by Mortgagee, whether or not
disbursed, all funds deposited by Mortgagor with Mortgagee pursuant to the Loan
Agreement, all reserves, deferred payments, deposits, refunds, cost savings and
payments of any kind relating
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to the Improvements ("Deposits");
(l) all plans and specifications prepared for construction of
the Improvements and all studies, data and drawings related thereto; and also
all contracts and agreements relating to the aforesaid plans and specifications
or to the aforesaid studies, data and drawings, or to the construction of
Improvements ("Plans"); and
(m) the right, in the name and on behalf of itself or
Mortgagor, to appear in or defend any action or proceeding brought with respect
to the Real Property or Improvements (including without limitation, any
condemnation or arbitration proceedings) and to commence any action or
proceedings to protect the interest of Mortgagee in the Real Property and
Improvements.
TO HAVE AND TO HOLD the Mortgaged Property unto Mortgagee, its
successors and assigns forever. All right, title and interest of Mortgagor in
and to all extensions, improvements, betterments, renewals, substitutes and
replacements of, and all additions and appurtenances to the Mortgaged Property
hereafter acquired by, or released to, Mortgagor or constructed, assembled or
placed by Mortgagor on the Real Property, and all conversions of the security
constituted thereby, immediately upon such acquisition, release, construction,
assembling, placement or conversion, as the case may be, and in each such case,
without any further mortgage, pledge, conveyance, assignment or other act by
Mortgagor, shall become subject to the lien of this Mortgage and Security
Agreement as fully and completely, and with the same effect, as though now owned
by Mortgagor and specifically described herein. Notwithstanding the foregoing,
Mortgagor shall, at its own cost, make, execute, acknowledge, deliver and record
any and all such further acts, deeds, conveyances, mortgages, notices of
assignment, transfers, assurances and other documents as Mortgagee shall from
time to time reasonably require for the better assuring, conveying, assigning,
transferring and confirming unto Mortgagee of the Mortgaged Property and the
other rights hereby conveyed or assigned or intended now or hereafter so to be,
or which Mortgagor may be or may hereafter become bound to convey or assign for
carrying out the intention of facilitating the performance of the terms of this
Mortgage and Security Agreement. In addition, Mortgagor hereby agrees that this
Mortgage and Security Agreement is a security agreement under the New Jersey
Uniform Commercial Code and creates in Mortgagee a security interest thereunder
in, among other things, all Equipment, Building Equipment, Intangibles, Awards,
Insurance Policies, Leases and Agreements, Income and Rents, Accounts
Receivable, Securities, Deposits and Plans. Mortgagor shall, at its own cost and
expense, execute, deliver and file any financing statements, continuation
certificates and other documents
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Mortgagee may reasonably require from time to time to perfect and maintain in
favor of Mortgagee a security interest under the Uniform Commercial Code in such
Equipment, Building Equipment, Intangibles, Awards, Insurance Policies, Leases
and Agreements, Income and Rents, Accounts Receivable, Securities, Deposits and
Plans. Without limiting the generality of any of the foregoing, Mortgagor hereby
irrevocably appoints Mortgagee attorney-in-fact for Mortgagor to execute,
deliver and file any of the documents referred to hereinabove for and on behalf
of Mortgagor following notice from Mortgagee to Mortgagor to execute such
documents and the failure by Mortgagor to do so within five (5) business days.
PROVIDED ALWAYS, and these presents are upon this express condition,
that if Mortgagor or its successors or assigns shall well and truly pay or cause
to be paid unto Mortgagee, its successors or assigns, the Aggregate Debt secured
by this Mortgage and Security Agreement, and otherwise perform Mortgagor's
obligations under the Loan Documents, then this Mortgage and Security Agreement,
and the estate hereby granted, shall cease, determine and be void, and Mortgagee
shall furnish to Mortgagor a satisfaction of this Mortgage and Security
Agreement in proper form for recording, but Mortgagee shall not be required to
bear any expense or cost in connection with such satisfaction or the recording
thereof.
THIS MORTGAGE AND SECURITY AGREEMENT also secures, inter alia, present
and future advances made by Mortgagee pursuant to the Loan Documents, including,
without limitation, advances made to enable completion of the Tenant
Improvements. The priority of such future advances shall relate back to the date
of this Mortgage and Security Agreement, or to such later date as required by
applicable law. This Mortgage and Security Agreement also secures advances made
by Mortgagee with respect to the Mortgaged Property for the payment of taxes,
assessments, maintenance charges, and insurance premiums, costs incurred by
Mortgagee for the protection of the Mortgaged Property or the lien of this
Mortgage and Security Agreement, and expenses incurred by Mortgagee by reason of
the occurrence of an event of default hereunder and the priority of such
advances, costs and expenses shall also relate back to the date of this Mortgage
and Security Agreement, or to such later date as required by applicable law.
MORTGAGOR WARRANTS TO AND COVENANTS WITH Mortgagee as
follows:
1. Title. As of the date hereof (a) Mortgagor has good and marketable
title to an indefeasible fee simple estate in the Mortgaged Property subject to
no lien, charge or encumbrance except such as are listed as exceptions to title
or exclusions
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from coverage in the title insurance policy being issued by Lawyers Title
Insurance Corporation to Mortgagee concurrently with the recording of this
Mortgage and Security Agreement; (b) this Mortgage and Security Agreement is and
shall remain a valid and enforceable first lien on the Mortgaged Property
subject only to the matters referred to in subparagraph (a) hereof; (c)
Mortgagor shall preserve such title, and all of its rights in and to the
Mortgaged Property, and shall forever warrant and defend the validity and
priority of the lien hereof against the claims of all persons and entities
whomsoever, subject only to the matters referred to in subparagraph (a) hereof;
and (d) Mortgagor has full power and lawful authority to mortgage the Mortgaged
Property and grant a security interest therein in the manner and form herein
done or intended hereafter to be done.
2. Payment and Performance. Mortgagor shall punctually pay or cause to
be paid the Aggregate Debt, in the amounts and at the times and places that the
same may be due, and perform and comply with all of the terms, covenants,
conditions and obligations contained in the Loan Documents.
3. Taxes and Other Charges. Mortgagor shall pay all taxes of every kind
and nature (including real and personal property, income, gross receipts,
franchise, profits, sales and withholding taxes), all general and special
assessments, water and sewer rents and charges, and all levies, permits,
inspection and license fees and other public charges now or hereafter levied or
assessed against the Mortgaged Property as liens or assessments (hereinafter
individually called a "Tax" and collectively the "Taxes") as the same shall
become due and payable from time to time and before interest or penalties accrue
thereon; provided, however, that Mortgagor shall not be required to pay any Tax
to the extent that nonpayment thereof is permitted while the validity thereof is
being contested, so long as (a) Mortgagor notifies Mortgagee in writing of its
intention to contest the validity thereof, (b) the validity thereof is being
contested in good faith by Mortgagor and (c) Mortgagor deposits with Mortgagee
if Mortgagee so requests an amount reasonably deemed sufficient to make such
payment if the contest is unsuccessful. Notwithstanding the foregoing, Mortgagor
shall under no circumstances permit the Mortgaged Property to be sold or
advertised for sale for nonpayment of any Tax. Mortgagor shall not apply for or
claim any deduction from the taxable value of the Mortgaged Property because of
the existence of the Note or this Mortgage and Security Agreement. Subject to
Mortgagor's right to contest any Tax as hereinabove provided, Mortgagor shall
deliver to Mortgagee receipts evidencing the payment of such Tax on or before
the last day on which any Tax may be paid without interest or penalties or as
soon thereafter as such receipts are available.
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4. Insurance. Mortgagor shall keep the Improvements and the Equipment
continuously insured against loss or damage by fire (with extended coverage),
theft, vandalism, malicious mischief, sprinkler leakage, flood (if the Mortgaged
Property is located in a flood plain area) and such other hazards as Mortgagee
shall from time to time reasonably require in a total amount equal to the full
insurable value, as determined by the insurance company which shall issue such
insurance, or in any event not less than that amount below which any
co-insurance provisions would apply and not less than the then outstanding
amount of the Aggregate Debt. Mortgagor shall also carry appropriate insurance
applicable to the Mortgaged Property in connection with the construction work
upon the Mortgaged Property (whether or not such work is expensed or capitalized
by Mortgagor) as required in the Loan Agreement and in such amounts as may be
required by Mortgagee. Mortgagor shall also carry rental loss insurance and
comprehensive liability insurance (including bodily injury and property damage)
covering all operations of Mortgagor on the Mortgaged Property in such amounts
as may be reasonably required by Mortgagee. Any policy or policies with respect
to all of the abovementioned insurance (hereinafter called a "Policy") (a) shall
be issued by an insurer reasonably acceptable to Mortgagee (for these purposes,
Aetna Insurance Company is acceptable to Mortgagee), (b) shall contain, in the
case of the hazard insurance and rental loss insurance, a mortgagee clause
endorsement naming Mortgagee and its successors and assigns as a co-insured
thereunder, as its interests may appear, and, at Mortgagee's option, shall
contain a clause naming Mortgagee as an additional insured and/or loss payee,
(c) shall contain a provision that Mortgagee shall be given thirty (30) days'
prior written notice of material change or cancellation of said Policy and that
no such change or cancellation shall be effective as to Mortgagee in the absence
of such notice, and (d) shall contain such other provisions as shall from time
to time be reasonably required by Mortgagee. Any such Policy may provide for
customary "deductibles" provided the limits thereof are reasonably satisfactory
to Mortgagee. Not less than fifteen (15) days' prior to any date upon which any
premium for such insurance shall be due and payable, Mortgagor shall deliver to
Mortgagee satisfactory evidence that such premium has been paid, and further,
not less than fifteen (15) days' prior to the expiration date of any Policy,
Mortgagor shall deliver to Mortgagee satisfactory evidence of the renewal of
such Policy. In the event of the foreclosure of this Mortgage and Security
Agreement or other transfer of Mortgagor's interest in the Mortgaged Property in
satisfaction of the Aggregate Debt, all right, title and interest of Mortgagor
to any Policy then in force covering the Mortgaged Property (including any right
to any deferred premiums) shall pass to the transferee of the Mortgaged
Property.
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5. Tax and Insurance Escrow. Upon the written request of Mortgagee at
any time following the occurrence of an event of default hereunder, Mortgagor
shall pay to Mortgagee on the first day of each month a sum equal to one-twelfth
(1/12) of the amount of (a) all real estate taxes, water and sewer charges and
assessments, if any, as estimated from time to time by Mortgagee, becoming due
with respect to the Mortgaged Property on the next succeeding date upon which
the same shall be due and payable and (b) all premiums, computed on an annual
basis, for the insurance required to be carried pursuant to paragraph 4 hereof.
All such amounts (hereinafter, the "Escrows") shall be held by Mortgagee in such
manner as it sees fit without any obligation to invest the same or (if invested)
to account for any income or loss resulting therefrom; provided however, that if
and to the extent that Mortgagee is required under applicable law to invest the
Escrows for the benefit of Mortgagor, Mortgagee shall also have the right to
charge a reasonable service fee in connection therewith unless prohibited under
such law. The Escrows shall be applied to the payment of the respective items in
respect of which the Escrows were deposited, or at Mortgagee's option, to the
payment of any such items in such order of priority as Mortgagee shall
determine, as the same become due and payable. If, prior to the date upon which
any of the aforesaid items shall be due and payable, the amount of Escrows then
on deposit therefor shall be insufficient to pay such item, Mortgagor within
five (5) days after demand is made therefor shall deposit the amount of such
deficiency with Mortgagee. If there is an event of default hereunder, Mortgagee
may at its option apply the Escrows or any part thereof in payment of any unpaid
portion of the Aggregate Debt. If, when making any assignment of this Mortgage
and Security Agreement, the then Mortgagee shall pay over to its assignee the
then balance of the Escrows and such assigning Mortgagee shall have no further
obligation to Mortgagor with respect to such deposits.
6. Casualty Loss. Mortgagor shall notify Mortgagee in writing
immediately upon the occurrence of any loss affecting the Mortgaged Property.
Mortgagor hereby directs any insurer to pay directly to Mortgagee any moneys
payable under any Policy, and Mortgagor hereby appoints Mortgagee as
attorney-in-fact to endorse any draft therefor. Sums paid to Mortgagee by any
insurer may be retained and applied by Mortgagee toward payment of the Aggregate
Debt (whether or not any portion thereof may then be due and payable) in such
priority and proportions as Mortgagee in its discretion shall deem proper, and
any sums not so applied, at the discretion of Mortgagee, may be paid, either in
whole or in part, to Mortgagor for such purposes and upon such conditions as
Mortgagee shall designate. Notwithstanding the
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foregoing, upon the request of Mortgagor, Mortgagee shall make such sums
available to Mortgagor for repair and restoration of the damaged property,
provided that (a) there is not then in existence any uncured event of default
under any of the Loan Documents, (b) Mortgagor shall deposit with Mortgagee
prior to the commencement of any such repair or restoration an amount equal to
the difference between the estimated cost to repair the damaged property and the
sums made available to Mortgagee on account of such insurance, and (c) such
repair and restoration can be completed within one (1) year from the date of the
loss (but in no event later than the Maturity Date (as defined in the Note)).
The determination of the cost to repair the damaged property shall be made by
Mortgagee in consultation with an independent third party engineer selected by
Mortgagee and paid for by Mortgagor. If Mortgagee retains such insurance money
and applies the same toward payment of the Aggregate Debt in accordance with
this paragraph 6, the lien of this Mortgage and Security Agreement shall be
reduced only by the amount thereof retained by Mortgagee and actually applied by
Mortgagee in reduction of the Aggregate Debt.
7. Condemnation. In the event that the whole or any material part of
the Mortgaged Property secured by this Mortgage and Security Agreement is
condemned or taken for any period of time, or there is any other injury to or
material decrease in value of the Mortgaged Property as a result of any public
or quasi-public authority or corporation exercising the power of eminent domain
or otherwise, all sums awarded as damages for such condemnation or taking to
which Mortgagor is entitled shall be paid over immediately to Mortgagee. Upon
the receipt thereof, Mortgagee may deduct and withhold from the amount actually
received any costs, charges or fees incurred by Mortgagee in connection with the
recovery of such award (hereinafter, "Mortgagee's Costs"), and thereafter
Mortgagee may apply all or any portion of the balance to the discharge of the
Aggregate Debt and, at the option of Mortgagee, may pay over any sums not so
applied to Mortgagor for the purpose of restoring or repairing the Mortgaged
Property or for any purpose or object satisfactory to Mortgagee, in which event
the Aggregate Debt shall not be reduced by that amount. Notwithstanding the
foregoing, in the event of a partial rather than complete condemnation of the
Mortgaged Property and upon the request of Mortgagor, Mortgagee shall make such
sums available to Mortgagor for repair and restoration of the damaged property,
provided that (a) there is not then in existence any uncured event of default
under any of the Loan Documents, (b) Mortgagor shall deposit with Mortgagee
prior to the commencement of any such repair or restoration an amount equal to
the difference between the cost to repair the damaged property and the sums made
available by Mortgagee on account of such insurance, (c) such repair and
restoration can be
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completed within six (6) months from the date of the loss (but in no event later
than the Maturity Date) and (d) Mortgagee has determined that the condemnation
of the Mortgaged Property will not materially adversely affect the ownership and
operation of the Mortgaged Property for its current purpose as an office
building. Mortgagor hereby irrevocably appoints Mortgagee as attorney-in-fact
for Mortgagor for the purpose of collection of any or all proceeds available in
connection with the condemnation of the Mortgaged Property. If the Mortgaged
Property is transferred, through foreclosure or otherwise, prior to the receipt
by Mortgagee of such award of payment, Mortgagee shall have the right, whether
or not a deficiency judgment on the Note shall have been sought, recovered or
denied, to receive such award or payment, or a portion thereof sufficient to pay
the Aggregate Debt, whichever is less.
8. Preservation of Lien; No Conveyance of Title.
(a) Mortgagor shall pay, from time to time as and when the
same shall become due, all claims and demands of any persons or entities which,
if unpaid, might result in or permit the creation of a lien on the Mortgaged
Property or any part thereof, and in general shall do or cause to be done
everything necessary so that the lien hereof shall be fully preserved and so
that there shall not be created, permitted or suffered to exist any lien,
encumbrance or charge affecting the Mortgaged Property other than those matters
referred to in paragraph 1(a) hereof which have been approved in writing by
Mortgagee, all at the sole cost of Mortgagor. At Mortgagee's election, and
without notice to Mortgagor, Mortgagee may make but is not obligated to make,
any payments which Mortgagor has failed to make under any prior lien, but such
payment by Mortgagee shall not release Mortgagor from Mortgagor's obligations or
constitute a waiver of Mortgagor's default hereunder. Any sum so expended by
Mortgagee shall be secured by this Mortgage and Security Agreement, together
with interest thereon at the rate stipulated in the Note from the date such
payment is made by Mortgagee until the date of repayment by Mortgagor.
Notwithstanding the foregoing, Mortgagor shall have the right, at its sole cost
and expense, to contest in good faith by any lawful means any such claims and
demands, provided that it notifies Mortgagee in writing of its intention to do
so and deposits with Mortgagee, if Mortgagee so requests, an amount deemed
reasonably sufficient by Mortgagee to satisfy such claims and demands if it is
ultimately determined that Mortgagor is responsible therefor.
(b) Mortgagor shall not convey or attempt to convey or permit
or suffer a conveyance or transfer of legal or equitable title to the Mortgaged
Property or any part thereof and whether such conveyance or transfer is
voluntary, involuntary, by
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operation of law or otherwise, so long as any part of the Aggregate Debt remains
unpaid without the prior written consent of Mortgagee.
9. Maintenance and Repair; Compliance with Laws and Regulations.
Mortgagor shall cause the Mortgaged Property to be maintained in good condition
and repair, reasonable wear and tear excepted. None of the Improvements,
Equipment or Building Equipment shall be removed, demolished, materially altered
or sold (except for normal replacement or upgrade of the Equipment), without the
prior written consent of Mortgagee. Subject to the release of the insurance
proceeds, Mortgagor shall promptly repair, replace or rebuild any part of the
Mortgaged Property which may be damaged or destroyed by any casualty or which
may be affected by any condemnation or eminent domain proceeding. Mortgagor
shall promptly comply with all laws, orders, ordinances, regulations,
restrictions and requirements of governmental authorities, of courts and of
insurance companies applicable to Mortgagor or affecting the Mortgaged Property,
or the use thereof. Mortgagor also shall promptly comply with the provisions of
any recorded covenants, conditions or restrictions to which the Mortgaged
Property or any part thereof may at any time be subject. Mortgagor shall not
cause or allow the construction or erection of any public, municipal or utility
improvements upon the Mortgaged Property other than those required by public
authorities, without the prior written consent of Mortgagee. Mortgagor shall not
drill or extract or enter into any lease for the drilling for or extraction of
oil, gas or other hydrocarbon substances or any mineral of any kind or character
on or from the Mortgaged Property or any part thereof without the prior written
consent of Mortgagee. Mortgagor shall not seek, make or consent to any change in
zoning or conditions of use of the Mortgaged Property which would impair the
ability of Mortgagor to operate the Real Property and Improvements as a first
class office building.
10. Environmental Matters.
(a) To the best of Mortgagor's knowledge based upon the
Environmental Report and the Purchase Agreement, except as may be set forth in
the Environmental Report or the Purchase Agreement and except for the use and
storage of Hazardous Substances in de minimis amounts which are used in and
stored in compliance with all applicable laws and regulations, (i) the Mortgaged
Property has not been used for the generation, manufacture, storage or disposal
of, and there has not been transported to or from the Mortgaged Property, any
Hazardous Substances or Wastes, (ii) there are no Hazardous Substances or Wastes
present on the Mortgaged Property, (iii) the Mortgaged Property does not consist
in whole or in part of any soils or
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vegetation that would be considered to be Wetlands, (iv) there has been no use
of the Mortgaged Property that may, under any federal, state or local law or
regulation, require any closure or cessation of the use of the Mortgaged
Property or impose upon Mortgagor or its successors any monetary obligations,
(v) no lien or superlien has been recorded, asserted or threatened against the
Mortgaged Property for any liability in connection with any environmental
contamination, and (vi) the Mortgaged Property is in compliance with all
federal, state or local laws and regulations relating to environmental matters.
(b) Mortgagor's knowledge with respect to environmental
matters affecting the Mortgaged Property is limited to such matters, if any,
which appear in the Environmental Report or Purchase Agreement.
(c) Mortgagor has not been identified in any litigation,
proceeding or investigation as a responsible party or potentially responsible
party for any liability for disposal or release of any Hazardous Substances or
Wastes.
(d) Mortgagor will not, and will use reasonable efforts not
to, permit any tenant or other occupant of the Mortgaged Property to, store,
use, generate, treat or dispose of any Hazardous Substances or Wastes on the
Mortgaged Property except in de minimus quantities and in accordance with all
applicable laws. Mortgagor promptly shall advise Mortgagee in writing of and
with respect to any pending or known threatened claim, demand, action or notice
by any governmental authority or third party relating to any Hazardous
Substances or Wastes affecting the Mortgaged Property or the discovery or
determination of the existence of any Hazardous Substances or Wastes or Wetlands
on the Mortgaged Property. Mortgagee shall have the right to join in or
participate in any legal proceedings or actions initiated in connection with any
Hazardous Substances, Wastes or Wetlands affecting the Mortgaged Property.
Mortgagor shall reimburse Mortgagee for reasonable attorneys' fees and costs in
connection therewith and Mortgagor shall indemnify, defend and hold harmless
Mortgagee from and against any claim, demand, loss or liability, including but
not limited to costs of remedial action, response costs, personal injury and
property damage, directly or indirectly arising out of or attributable to the
use, generation, deposit, storage, release, discharge, disposal, burial,
dumping, spilling, leaking or other presence of Hazardous Substances or Wastes
on, under or affecting the Mortgaged Property or arising as the result of the
existence of Wetlands on the Mortgaged Property. The foregoing indemnity shall
specifically survive the repayment of the Loan and the satisfaction of the
Mortgage, but shall not be applicable to any environmental matter first arising
subsequent to Mortgagor's
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ownership of the Mortgaged Property. Mortgagor shall not, without obtaining
Mortgagee's prior written consent, enter into any settlement agreement, consent
decree or other compromise in respect to any Hazardous Substances, Wastes or
Wetlands affecting the Mortgaged Property.
11. Leases. Except as otherwise provided in the Loan Agreement,
Mortgagor shall not enter into any lease or similar agreement for space in or on
the Mortgaged Property without in each case obtaining Mortgagee's prior written
approval of all the terms and conditions thereof and, once approved, Mortgagor
shall not amend, modify or cancel any such lease or similar agreement or assign
any amounts due thereunder without obtaining Mortgagee's prior written approval.
12. Required Notice. Mortgagor shall give Mortgagee prompt written
notice of any action or proceeding purporting to affect the Mortgaged Property
of which it has actual knowledge including, without limitation, the following:
(a) a fire or other casualty causing damage to the Mortgaged Property; (b)
receipt of notice of condemnation of the Mortgaged Property or any part thereof;
(c) receipt of notice from any governmental authority relating to the structure,
use or occupancy of the Mortgaged Property; (d) receipt of any notice from any
tenant of all or any portion of the Mortgaged Property; (e) any change in the
occupancy of the Mortgaged Property; (f) receipt of any notice from the holder
of any lien or security interest in the Mortgaged Property; or (g) commencement
of any litigation affecting the Mortgaged Property. Mortgagee shall have the
right to appear in or defend any such action or proceeding to the same extent as
Mortgagor after written notice to Mortgagor. Furthermore, Mortgagee shall have
the right to bring any action or proceeding, in the name and on behalf of itself
or Mortgagor, which Mortgagee, in its discretion, feels should be brought to
protect its interest in the Mortgaged Property or any part thereof.
13. Mortgagee's Right to Cure. Mortgagee shall have the right, but not
the obligation, at Mortgagee's election and after written notice to Mortgagor,
to cure any default by Mortgagor under any of the Loan Documents or under any
mortgage or with respect to any security interest, lien or encumbrance which is
senior in lien and position to this Mortgage and Security Agreement. Any
payments made or expenses incurred by Mortgagee in the exercise of such right
shall not release Mortgagor from Mortgagor's obligation or constitute a waiver
of Mortgagor's default hereunder. Any such payments made or expenses incurred by
Mortgagee shall be repayable within three (3) business days after demand by
Mortgagee, together with interest thereon at the rate specified in the Note from
the date such payment was made or
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such expense was incurred, and the aggregate amount thereof, including such
interest, shall become part of the Aggregate Debt and shall be secured by the
lien of this Mortgage and Security Agreement.
l4. Certificate of No Offsets. Within five (5) days after being
requested to do so by Mortgagee, Mortgagor shall furnish to Mortgagee or any
proposed assignee of this Mortgage and Security Agreement a statement, duly
executed, acknowledged and certified by Mortgagor, setting forth the remaining
unpaid amount of the Aggregate Debt and whether there exist any uncured
defaults, offsets or defenses thereto.
l5. Right to Inspect. Mortgagor shall permit Mortgagee and its agents
to enter and inspect the Mortgaged Property or any part thereof at all
reasonable times during normal business hours and in such a manner so as not to
unreasonably interfere with Mortgagor's operations.
l6. Revenue, Tax or Other Stamps. Mortgagor shall pay the cost of any
revenue, tax or other stamps now or hereafter required by the laws of the State
of New Jersey or the United States to be affixed to the Note or this Mortgage
and Security Agreement and if any taxes are imposed under the laws of the State
of New Jersey or the United States with respect to debts secured by a mortgage,
or with respect to evidences of indebtedness so secured, Mortgagor shall pay or
reimburse Mortgagee upon demand the amount of such taxes without credit against
any indebtedness evidenced by the Note. If Mortgagor does not or may not do so,
Mortgagee may at its option accelerate the indebtedness evidenced by the Note to
maturity as in the case of default by Mortgagor.
17. Possession. Until an event of default shall have occurred under
this Mortgage and Security Agreement, Mortgagor shall be suffered and permitted
to retain actual possession of the Mortgaged Property, to manage, operate, use
and enjoy the same and all rights appertaining thereto, and to collect, receive,
take, use and enjoy the Income and Rents. The right of Mortgagor to collect the
Income and Rents may be revoked by Mortgagee at any time and from time to time
after an event of default has occurred under this Mortgage and Security
Agreement, by giving notice of such revocation to Mortgagor. Following the
giving of such notice, Mortgagee may retain and apply the Income and Rents
toward payment of the Aggregate Debt in such priority and proportions as
Mortgagee, in its discretion, shall determine.
18. Events of Default. The occurrence of any one or more
of the following events, after the expiration of any applicable
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notice and/or cure period specifically provided for herein, shall, at the sole
option of the Mortgagee, constitute an "event of default" hereunder:
(a) Mortgagor shall fail to pay any regularly scheduled
installment of principal and/or interest due to Mortgagee under the Note when
the same shall become due and payable (including payment of the Loan on the
Maturity Date), or Mortgagor shall fail to make any other payment due under any
of the Loan Documents within fifteen (15) days after notice thereof from
Mortgagee;
(b) Except as otherwise provided for herein, Mortgagor shall
fail to observe or perform any of the covenants or agreements on its part to be
observed or performed under this Note or under any of the other Loan Documents
within thirty (30) days after written notice from Mortgagee of such
non-compliance, provided that if such non-compliance cannot reasonably be cured
within such thirty day period but Mortgagor undertakes within such thirty day
period and thereafter diligently pursues the curing of such non-compliance, then
the period within which Mortgagor shall cure such non-compliance shall be
extended to sixty (60) days after the original written notice from Mortgagee of
such non-compliance;
(c) Any representation or warranty of Mortgagor under this
Mortgage and Security Agreement or under any of the other Loan Documents shall
be untrue in any material respect;
(d) Any event of default, after the expiration of any
applicable notice and/or cure period specifically provided for therein, shall
occur under the terms of any of the other Loan Documents;
(e) Mortgagor shall apply for or consent to the appointment of
a receiver, trustee or liquidator of itself or any of its, admit in writing its
inability to pay its debts as they mature, make a general assignment for the
benefit of creditors, be adjudicated a bankrupt, insolvent or file a voluntary
petition in bankruptcy, or a petition or an answer seeking reorganization or an
arrangement with creditors or to take advantage of any bankruptcy,
reorganization, insolvency, readjustment of debt, dissolution or liquidation law
or statute, or an answer admitting the material allegations of a petition filed
against it in any proceeding under any such law, or if action shall be taken by
Mortgagor for the purpose of effecting any of the foregoing;
(f) Any order, judgment or decree shall be entered by
any court of competent jurisdiction, approving a petition seeking
reorganization of Mortgagor or all or a substantial part of the
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assets of Mortgagor or appointing a receiver, sequestrator, trustee or
liquidator of Mortgagor or any of its property, and such order, judgment or
decree shall continue unstayed and in effect for any period of thirty (30) days.
19. Remedies. Subject to the limitation set forth in paragraph 24
hereof, upon the occurrence of any event of default:
(a) The Aggregate Debt shall, at the option of Mortgagee,
become due and payable immediately without presentment, demand, notice of
nonpayment, protest, notice of protest or other notice of dishonor, all of which
are hereby expressly waived by Mortgagor.
(b) Mortgagee may institute appropriate proceedings at law or
equity to collect the amount of the Aggregate Debt then due (by acceleration or
otherwise), or for specific performance of any of the covenants of Mortgagor
under any of the Loan Documents (and Mortgagor acknowledges that all such
covenants may be specifically enforced by Mortgagee by injunction or other
appropriate equitable remedy), or to recover damages for any breach thereof, or
to 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 Security Agreement and realization on the mortgage security or any
other security herein or elsewhere provided for, and proceed therein to final
judgment and execution for the Aggregate Debt, with interest as specified in
paragraph 21 below, together with costs and expenses as specified in paragraph
22 below.
(c) After demand upon Mortgagor for the surrender of
possession, Mortgagee may enter upon and take possession of the Mortgaged
Property, breaking locks if necessary and without liability for trespass,
damages or otherwise and, upon so doing, Mortgagee may, in its discretion and in
addition to any of its other rights, as Mortgagee in possession, alter, improve,
complete or repair the Mortgaged Property (and in so doing Mortgagee shall have
the right to use the Mortgaged Property and to expend such amount for that
purpose as Mortgagee shall deem best, all of which, with interest thereon at the
rate specified in the Note from date of payment, shall be repayable by Mortgagor
on demand and shall be secured hereby), and operate, rent, sell or lease the
same in the name of Mortgagor or Mortgagee upon such terms and conditions as
Mortgagee shall deem appropriate, and Mortgagor hereby irrevocably appoints
Mortgagee attorney-in-fact for Mortgagor for all such purposes while there
exists any uncured event of default hereunder.
(d) Mortgagee may further, by summary proceedings,
initiate an action for possession or otherwise, dispossess any
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tenants, users or occupiers of the Mortgaged Property then or thereafter in
default in the payment of any rent or other charge for the use thereof, and any
tenants or other users or occupiers whose leasehold estates or rights to use the
Mortgaged Property are subordinate to the lien of this Mortgage and Security
Agreement, whether or not any such tenant, user or occupier is so in default;
and Mortgagor hereby irrevocably appoints Mortgagee attorney-in-fact of
Mortgagor for all such purposes. If Mortgagor remains in possession after demand
by Mortgagee for surrender of possession of the Mortgaged Property, such
continued possession by Mortgagor shall be as tenant of Mortgagee, and Mortgagor
agrees to pay monthly in advance to Mortgagee such rent for the Mortgaged
Property so occupied as Mortgagee may demand, and in default of so doing,
Mortgagor may also be dispossessed by summary proceedings or otherwise. In case
of the appointment of a receiver of the rents, the foregoing agreement of
Mortgagor to pay rent shall inure to the benefit of such receiver.
(e) With or without taking possession of the Mortgaged
Property, Mortgagee may collect and receive all the Income and Rents and, after
deducting the cost of all reasonable alterations, improvements, repairs,
completion, partial completion, operation, sale, rental, leasing commissions and
charges, including, but not limited to, counsel fees, incurred by Mortgagee,
apply the net income to the sums secured hereby in such manner as Mortgagee in
its discretion shall determine. Mortgagee shall be liable to account only for
the Income and Rents actually received.
(f) If Mortgagee shall so elect, Mortgagor shall not resist or
contest, but shall join in any petition to any court by Mortgagee for the
appointment of a receiver or receivers of the Mortgaged Property or any part
thereof, and of all the Income and Rents therefrom, with such powers as the
court making such appointment shall confer, and Mortgagor hereby appoints
Mortgagee attorney-in-fact of Mortgagor for all such purposes.
(g) All deposits held in connection with the rental, lease,
license or use of space or other facilities on the Mortgaged Property at the
time of the occurrence of such event of default, all interest of Mortgagor in
all premiums for, or dividends upon, any insurance for the Mortgaged Property,
and all refunds or rebates of taxes and assessments upon the Mortgaged Property,
are hereby assigned to Mortgagee as further security for the payment of the
Aggregate Debt during the continuance of any such event of default.
(h) To the extent now or hereafter permitted by law and
subject to such grace periods and notice requirements thereby imposed or imposed
by this Mortgage and Security Agreement,
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Mortgagee may cause a judicial sale of the Mortgaged Property in accordance with
this subparagraph (h). Such sale may be made without demand on Mortgagor at the
time and place fixed in the notice of such sale, and such sale may be of the
Mortgaged Property as a whole or in separate lots, and in such order as
Mortgagee may determine, at public auction to the highest bidder for cash in
lawful money of the United States, payable at time of sale. Such sale of the
Mortgaged Property may be postponed by public announcement at the time and place
of sale, and may be further postponed from time to time thereafter by public
announcement at the time fixed by the preceding postponement. Any person or
entity, including Mortgagee, may purchase at such sale. After deducting all
costs, fees, and expenses of Mortgagee, including cost of evidence of title in
connection with such sale, the proceeds of sale shall be applied to payment of
the Aggregate Debt. The Mortgaged Property may be sold as aforesaid either
before, after, or during the pendency of any proceedings for the enforcement of
the provisions of this Mortgage and Security Agreement, and such power and right
of sale shall not be affected by any entry hereunder, or by the exercise of any
other right, remedy or power with respect to the enforcement of the provisions
of any of the Loan Documents or the collection of the amount of the Aggregate
Debt. The provisions of this subparagraph (h) are not intended to and shall not
adversely affect Mortgagee's rights to conduct a nonjudicial sale of such
portions of the Mortgaged Property as constitute personal property.
20. Remedies Cumulative.
(a) No right or remedy conferred upon or reserved to Mortgagee
under any of the Loan Documents or with respect to any Collateral, or now or
hereafter existing at law or in equity or by statute or other legislative
enactment, is intended to be exclusive of any other such right or remedy and
each and every such right or remedy shall be cumulative and concurrent, and
shall be pursued separately, concurrently, successively or otherwise, at the
sole discretion of Mortgagee, and shall not be exhausted by any one exercise
thereof but may be exercised as often as occasion therefor shall occur. No act
of Mortgagee shall be deemed or construed as an election to proceed under any
one such right or remedy to the exclusion of any other such right or remedy;
furthermore, each such right or remedy of Mortgagee shall be separate, distinct
and cumulative and none shall be given effect to the exclusion of any other. The
failure to exercise or delay in exercising any such right or remedy, or the
failure to insist upon strict performance of any term of any of the Loan
Documents, shall not be construed as a waiver or release
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of the same, or of any event of default thereunder, or of any obligation or
liability of Mortgagor thereunder.
(b) The recovery of any judgment by Mortgagee or the levy of
execution under any judgment upon the Mortgaged Property shall not affect in any
manner, or to any extent, the lien of this Mortgage and Security Agreement upon
the Mortgaged Property, or any security interest in any other Collateral, or any
rights, remedies or powers of Mortgagee under any of the Loan Documents or with
respect to any Collateral, but such lien and such security interest and such
rights, remedies and powers of Mortgagee shall continue unimpaired as before.
Further, the entry of any judgment by Mortgagee shall not affect in any way the
interest payable hereunder or under any of the other Loan Documents on any
amounts due to Mortgagee, but interest shall continue to accrue on such amounts
at the Default Rate (as hereinafter defined) after the entry of any judgment and
continuing until distribution of the proceeds of any Sheriff's sale.
(c) Mortgagor hereby waives presentment, demand, notice of
nonpayment, protest, notice of protest or other notice of dishonor, and except
to the extent specifically provided for herein, any and all other notices in
connection with any default in the payment of, or any enforcement of the payment
of, the Aggregate Debt except as provided in the Loan Documents. To the extent
permitted by law, Mortgagor waives the right to any stay of execution and the
benefit of all exemption laws now or hereinafter in effect.
(d) Mortgagor agrees that Mortgagee may release, compromise,
forbear with respect to, waive, suspend, extend or renew any of the terms of the
Loan Documents (and Mortgagor hereby waives any notice of any of the foregoing),
and that the Loan Documents may be amended, supplemented or modified by
Mortgagee and the other signatory parties and that Mortgagee may resort to any
Collateral in such order and manner as it may think fit, or accept the
assignment, substitution, exchange, pledge, or release of all or any portion of
any Collateral, for such consideration, or none, as it may require, without in
any way affecting the validity of any liens over or other security interest in
the remainder of any such Collateral (or the priority thereof or the position of
any subordinate holder of any lien or other security interest with respect
thereto); and any action taken by Mortgagee pursuant to the foregoing shall in
no way be construed as a waiver or release of any right or remedy of Mortgagee,
or of any event of default, or of any liability or obligation of Mortgagor,
under any of the Loan Documents.
(e) To the extent permitted by law, Mortgagor shall
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not at any time insist upon, or plead, or in any manner whatever claim or take
any benefit or advantage of any stay or extension or moratorium law, or any
exemption from execution or sale of the Mortgaged Property, wherever enacted,
now or at any time hereafter in force, which may affect the covenants and terms
of performance of this Mortgage and Security Agreement, nor claim, take, or
insist upon any benefit or advantage of any law now or hereafter in force
providing for the valuation or appraisal of the Mortgaged Property, prior to any
sale of any of Mortgagor's interest therein; nor, after any such sale or sales,
claim or exercise any right under any statute heretofore or hereafter enacted to
redeem the Mortgaged Property so sold or any part thereof, and Mortgagor hereby
expressly waives all benefit or advantage of any such law or laws, and covenants
not to hinder, delay, or impede the execution of any power herein granted to
Mortgagee but to suffer and permit the execution of every power as though no
such law or laws had been made or enacted. Mortgagor further waives and releases
all procedural errors, defects and imperfections in any proceeding instituted by
Mortgagee under any of the Loan Documents.
(f) Mortgagor, for itself and for all persons hereafter
claiming through or under it or who may at any time hereinafter become holders
of liens junior to the lien of this Mortgage and Security Agreement, hereby
expressly waives and releases all rights to direct the order in which any of the
Mortgaged Property shall be sold in the event of any sale or sales pursuant
hereto and to have any of the Mortgaged Property and/or any other property now
or hereafter constituting security for the Aggregate Debt marshalled upon any
foreclosure of this Mortgage and Security Agreement or of any other security for
any of the Aggregate Debt.
(g) Mortgagor agrees that any action or proceeding against it
to enforce the Mortgage and Security Agreement may be commenced in state or
federal court in Camden County in the State of New Jersey and Mortgagor waives
personal service of process and agrees that a summons and complaint commencing
an action or proceeding in any such court shall be properly served if served by
registered or certified mail in accordance with the notice provisions set forth
herein and Mortgagor expressly waives any and all defenses to an exercise of
personal jurisdiction by any such court.
(h) Mortgagor hereby knowingly, voluntarily and
intentionally waives any right it may have to a trial by jury in
respect of any litigation based upon or arising out of, under or
in connection with this Mortgage, any of the other Loan Documents
or any course of conduct, course of dealing, statements (whether
verbal or written) or actions of Mortgagor or Mortgagee. This
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provision is a material inducement for Mortgagee to make the Loan.
21. Default Rate. Following the occurrence of any event of default and
continuing either until such event of default is cured and that fact
acknowledged by Mortgagee or until the principal sum then outstanding under the
Note and all other sums payable under the Loan Documents are paid in full, the
principal sum outstanding under the Note shall bear interest at rate equal to
the annual interest rate then applicable under paragraph 1 of the Note plus four
percent (4%) per annum, which rate shall change if, when and as such interest
rate changes ("Default Rate"), and shall be secured by the Mortgage and all
other Collateral.
22. Costs and Expenses. Following the occurrence of any event of
default under any of the Loan Documents, Mortgagor shall pay upon demand all
reasonable costs and expenses (including all amounts paid to attorneys,
accountants, real estate brokers and other advisors employed by Mortgagee and to
any contractors for labor and materials), incurred by Mortgagee in the exercise
of any of its rights, remedies or powers under any of the Loan Documents or with
respect to any Collateral with respect to such event of default, and any amount
thereof not paid promptly following demand therefor, together with interest
thereon at the Default Rate from the date of such demand, shall become part of
the Aggregate Debt and shall be secured by the lien of this Mortgage and
Security Agreement. In connection with and as part of the foregoing, in the
event that any of the Loan Documents is placed in the hands of any attorney for
the collection of any sum payable thereunder, Mortgagor agrees to pay attorneys'
fees for the collection of the amount being claimed under such Loan Documents,
as well as all costs, disbursements and allowances provided by law, and the
payment of such fees and costs, disbursements and allowances shall also be
secured by the lien of this Mortgage and Security Agreement. Nothing in this
paragraph 22 shall limit the obligation of Mortgagor to pay costs and expenses
of Mortgagee for which Mortgagor is otherwise liable under the Loan Documents.
23. Renewals and Extensions. This Mortgage and Security Agreement shall
secure any and all renewals, or extensions of the whole or any part of the
indebtedness hereby secured however evidenced, with interest at such lawful rate
as may be agreed upon and any such renewals or extensions or any change in the
terms or rate of interest shall not impair in any manner the validity of or
priority of this Mortgage and Security Agreement, nor release Mortgagor from
personal liability for the indebtedness hereby secured.
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24. Limited Liability of Mortgagor. Except as hereinafter set forth,
Mortgagor shall not have any personal liability for the payment of the Loan or
for the payment of any sum or performance of any obligation under any of the
Loan Documents, and in the event of a default under this Mortgage and Security
Agreement or any of the other Loan Documents, Mortgagee will look solely to the
Real Property and Improvements, the rents, issues and profits thereof and any
other Collateral specifically pledged, assigned or granted by Mortgagor to
Mortgagee as security for the Loan pursuant to this Mortgage and Security
Agreement or any of the other Loan Documents, and any judgment obtained against
Mortgagor shall so note by its terms or as otherwise permissible by law. Subject
to the aforesaid limitation, nothing herein contained shall be construed to
prevent Mortgagee from exercising and enforcing any other remedy against
Mortgagor or any other person or entity allowed at law or in equity or by any
statute or by the terms of this Mortgage and Security Agreement or any of the
other Loan Documents or any other deed of trust, mortgage, security agreement,
assignment of leases and rents, guaranty or any other security instrument of any
kind now or hereafter securing payment of the Loan. In addition, notwithstanding
anything to the contrary contained herein, Mortgagor shall indemnify and hold
Mortgagee harmless against, and shall be personally liable and obligated to
Mortgagee for:
(a) the completion of construction of the Tenant Improvements
in accordance with the respective deadlines therefor in the New Leases free and
clear of any and all mechanics liens and any other liens and encumbrances;
(b) the payment on a current basis of all monthly installments
of principal and interest with respect to the Acquisition Portion of the Loan
and interest with respect to the Tenant Improvement Portion of the Loan (but
excluding therefrom the entire unpaid principal balance of the Loan becoming due
as a result of maturity or acceleration of the Loan to the extent not
constituting a regular monthly installment);
(c) the principal amount of the Loan to the extent of
$3,000,000, which may be allocated between the Acquisition Portion of the Loan
and Tenant Improvement Portion of the Loan as Mortgagee shall determine in its
sole discretion, and which shall not be reduced by any payments on account of
the Acquisition Portion of the Loan or Tenant Improvement Portion of the Loan by
Mortgagor or by any other person or entity, whether by payments in the ordinary
course or by mortgage foreclosure or otherwise; and
(d) an amount equal to all loss, liability, damage,
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cost and expense suffered or incurred by Mortgagee in any way arising out of,
resulting from or relating to any one or more of the following: (i) any fraud or
willful material misrepresentation committed by Mortgagor; (ii) any retention by
Mortgagor of rental income, security deposits, or similar income of the Real
Property and Improvements after an event of default has occurred under the Loan
Documents to the extent of any such retention; (iii) any real property taxes or
assessments accrued prior to Mortgagee's acquisition of ownership of the Real
Property and Improvements following a default by Mortgagor under the Loan; (iv)
removal or failure to replace any personal property securing the Loan, other
than in the ordinary course of Mortgagor's business; (v) misapplication of
insurance or condemnation proceeds relating to the Real Property and
Improvements; (vi) failure to maintain hazard or liability insurance relating to
the Real Property and Improvements, in accordance with the Loan Documents; (vii)
the presence of any Hazardous Substances or Wastes which may affect the Real
Property and Improvements, or any misrepresentation or breach of any covenants
or indemnities by Mortgagor set forth in the Loan Documents with respect to
Hazardous Substances or Wastes; (viii) any transfer of the Real Property and
Improvements or any portion thereof other than Permitted Transfers; (ix) any
indebtedness secured by a mortgage covering the Real Property and Improvements
other than the Seller Loan; (x) any bankruptcy, reorganization, insolvency,
readjustment of debt, dissolution, liquidation or receivership proceedings
instituted by or against Mortgagor, unless and except to the extent that such
proceedings are withdrawn, dismissed or discharged within ninety (90) days or
unless Mortgagee obtains title to the Real Property and Improvements within nine
(9) months; and (xi) all fees and costs, including reasonable attorney fees,
incurred in enforcing and collecting the foregoing.
25. Severability. In the event that for any reason one or more of the
provisions of this Mortgage and Security Agreement or their application to any
person or circumstance shall be held to be invalid, illegal, or unenforceable in
any respect or to any extent, such provisions shall nevertheless remain valid,
legal and enforceable in all such other respects and to such extent as may be
permissible. In addition, any such invalidity, illegality, or unenforceability
shall not affect any other provision of this Mortgage and Security Agreement,
but this Mortgage and Security Agreement shall be construed as if such invalid,
illegal or unenforceable provision had never been contained herein.
26. Successors and Assigns. This Mortgage and Security
Agreement inures to the benefit of Mortgagee and binds Mortgagor,
and their respective successors and assigns and the words
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"Mortgagee" and "Mortgagor" whenever occurring herein shall be deemed to include
such respective successors and assigns, as applicable. Mortgagee may assign or
otherwise transfer this Mortgage and Security Agreement and any or all of the
Loan Documents to any other person, and such other person shall thereupon become
vested with all of the benefits in respect thereof granted to Mortgagee herein
or otherwise.
27. Notices. All notices required or desired to be given to either of
the parties hereunder shall be in writing and shall be deemed to have been
sufficiently given for all purposes when presented personally to such party or
sent by a nationally recognized overnight courier or by certified or registered
mail, return receipt requested, to such party at its address set forth below:
Mortgagor: Brandywine Realty Trust
Two Greentree Centre, Suite 100
Marlton, New Jersey 08053
Attention: Gerard H. Sweeney, President and
Chief Executive Officer
with a
copy to: Pepper, Hamilton & Scheetz
3000 Two Logan Square
18th and Arch Streets
Philadelphia, Pennsylvania 19103
Attention: Brad A. Molotsky, Esquire
Mortgagee: Summit Bank
1800 Chapel Avenue West
Cherry Hill, New Jersey 08002
Attention: Amy Brown
Regional Vice President
with a copy to: Miller Dunham & Doering
l515 Market Street, Suite 1300
Philadelphia, Pennsylvania l9l02
Attention: David H. Huggler, Esquire
Such notice shall be deemed to be given when received if delivered personally or
three (3) days after the date mailed if sent by a nationally recognized
overnight courier or by certified or registered mail, return receipt requested.
Any notice of any change in such address shall also be given in the manner set
forth above. Whenever the giving of notice is required, the giving of such
notice may be waived in writing by the party entitled to receive such notice.
28. Definitions; Number and Gender. In the event Mortgagor
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consists of more than one person or entity, the obligations and liabilities
hereunder of each of such persons and entities shall be joint and several and
the word "Mortgagor" shall mean all or some or any of them. For purposes of this
Mortgage and Security Agreement, the singular shall be deemed to include the
plural and the neuter shall be deemed to include the masculine and feminine, as
the context may require. The words "Loan Agreement", "Mortgage and Security
Agreement", "Note", "Assignment of Leases and Rents" and "Assignment of
Contracts and Permits" shall include any supplements to or any amendments of or
restatements of the Loan Agreement, this Mortgage and Security Agreement, the
Note, the Assignment of Leases and Rents and the Assignment of Contracts and
Permits, respectively. The words "Real Property", "Mortgaged Property",
"Improvements", "Appurtenances", "Equipment", "Building Equipment",
"Intangibles", "Awards", "Insurance Policies", "Leases and Agreements", "Income
and Rents", "Accounts Receivable", "Securities", "Deposits" and "Plans" shall
include any portion of and additions to the Mortgaged Property, the Mortgaged
Property, the Improvements, the Appurtenances, the Equipment, the Building
Equipment, the Intangibles, the Awards, the Insurance Policies, the Leases and
Agreements, the Income and Rents, the Accounts Receivable, the Securities, the
Deposits and the Plans, respectively.
29. Incorporation by Reference. All of the terms and provisions of the
Note and the Loan Agreement are hereby incorporated herein by reference.
30. Captions. The captions or headings of the paragraphs of this
Mortgage and Security Agreement are for convenience only and shall not control
or affect the meaning or construction of any of the terms or provisions of this
Mortgage and Security Agreement.
31. Governing Law. This Mortgage and Security Agreement shall be
governed by and construed in accordance with the laws of the State of New
Jersey.
IN WITNESS WHEREOF, Mortgagor has executed this Mortgage and
Security Agreement the day and year first above written.
WITNESS/ATTEST: BRANDYWINE REALTY TRUST, a Maryland
Real Estate Investment Trust
By: /s/ Gerard H. Sweeney
- ---------------------------------- --------------------------------
Name: Name: Gerard H. Sweeney
Title: Title: President/CEO
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The address of the within named Mortgagee is 1800 Chapel Avenue West,
Cherry Hill, New Jersey 08002.
SUMMIT BANK
By: /s/ Amy Brown RVP
-----------------------------
Amy Brown
Regional Vice President
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STATE OF :
:ss.
COUNTY OF :
On this, the ____ day of ________, 1996, before me, a Notary Public in
and for the State of ______________________, personally appeared
____________________, who acknowledged himself to be the __________________ of
BRANDYWINE REALTY TRUST, a Maryland Real Estate Investment Trust, and that he as
such ___________________, executed the foregoing instrument on behalf of such
Trust for the purposes therein contained.
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
----------------------------
Notary Public
My Commission Expires:
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EXHIBIT A
ALL that certain land and premises situate in the Township of Cherry Hill,
County of Camden and the State of New Jersey, bounded and described as follows:
TRACT #1-BEGINNING at a point in the Southerly right of way line of New Jersey
State Highway Route #38, said point being corner formed by the intersection of
the said line of New Jersey State Highway Route #38 with the Easterly right of
way line of Third Avenue (50 feet wide), and extending; thence along the said
right of way line of New Jersey State Highway Route #38; thence
(1) South 80 degrees 11 minutes 00 seconds East, 19.53 feet to an angle point
common with the Southwesterly right of way line of the access road (ramp from
New Jersey State Highway Route #38 to Haddonfield Road), and extending; thence
along the said right of way line to the access road; thence
(2) South 45 degrees 29 minutes 39 seconds East, 336.69 feet to an angle point,
and extending; thence along the right of way line; thence
(3) South 21 degrees 17 minutes 18 seconds East, 120.52 feet to a point formed
by the intersection of said access road with the Westerly right of way line of
Haddonfield-Sorrell Horse Road (formerly Stoy Landing Road) a/k/a Camden County
Route #644 (formerly 66 feet wide), and extending; thence along the said right
of way line of Haddonfield-Sorrell Horse Road; thence
(4) South 09 degrees 49 minutes 00 seconds West, 283.83 feet to an angle point,
and extending; thence along the said right of way line of Haddonfield-Sorrell
Horse Road; thence
(5) South 24 degrees 17 minutes 14 seconds West, 96.05 feet to an angle point,
and extending; thence along the said right of way line of Haddonfield-Sorrell
Horse Road; thence
(6) South 09 degrees 49 minutes 00 seconds West, 257.21 feet to a point of
curvature and extending; thence
(7) at the point of curvature in the Westerly right of way line of
Haddonfield-Sorrell Horse Road, curving to the right having a radius of 30 feet,
and an arc length of 57.17 feet to a point of tangency connecting the
Northeasterly right of way line of Chapel Avenue (50 feet wide) a/k/a Camden
County Route #626 with the said right of way line of Haddonfield-Sorrell Horse
Road, and extending; thence along the said right of way line of Chapel Avenue;
thence
(8) North 61 degrees 00 minutes 11 seconds West, 108.14 feet to an angle point,
and extending; thence along the said right of way line of Chapel Avenue; thence
<PAGE>
(9) North 52 degrees 03 minutes 39 seconds West, 43.50 feet to a corner in point
common with Lot 3, Block 176.01 on the Current Tax Map of the Township of Cherry
Hill, and extending; thence along a line common with Lot 3, Block 176.Ol;
thence
(10) North 09 degrees 49 minutes 00 seconds East, 178.31 feet to a corner point
common with Lots 2 and 3, Block 176.01, said Tax Map and lands now or formerly
of Chapel Printing, and extending; thence along a line common with said Lot 2;
thence
(11) South 80 degrees 11 minutes 00 seconds East, 29.43 feet to a corner point,
and extending; thence along a line common with said Lot 2; thence
(12) North 09 degrees 49 minutes 00 seconds East, 52.21 feet to a corner point,
and extending; thence along a line common with said Lot 2; thence
(13) North 80 degrees 11 minutes 00 seconds West, 183.71 feet to a corner point
common with the Easterly right of way line of Third Avenue (50 feet wide), and
extending; thence
(14) North 09 degrees 49 minutes 00 seconds East, 670.93 feet to a corner point
common with the Southerly right of way line of New Jersey State Highway Route
#38 and being the place of beginning.
BEING shown and designated as Lot 1, Block 176.01, Plate 18 on the Current Tax
Map of the Township of Cherry Hill.
TRACT #2-BEGINNING at a point formed by the intersection of the Northeasterly
line of Chapel Avenue (width varies) with the Southeasterly line of Third Avenue
(50 feet wide) and extending; thence
(1) North 09 degrees 49 minutes 01 seconds East, along the Southeasterly line of
Third Avenue, 142.67 feet to a point in the division line between existing Tax
Lots 1 and 2, Block 176.01; thence
(2) South 80 degrees 10 minutes 59 seconds East, along said division line,
183.71 feet to point concrete monument in the division line between said Tax
Lots; thence
(3) South 09 degrees 49 minutes 01 seconds West, along said division line, 52.21
feet to a set iron pin in the division line between said Tax Lots; thence
<PAGE>
(4) North 80 degrees 10 minutes 59 seconds West, along said division line, 29.43
feet to a found iron pin for a corner in the division line between Tax Lots 1, 2
and 3, Block 176.01; thence
(5) South 09 degrees 49 minutes 01 seconds West along the division line between
Tax Lots 1 and 3, Block 176.01, 180.26 feet to a point in the Northeasterly line
of Chapel Avenue; thence
(6) North 53 degrees 04 minutes 12 seconds West, along said line of Chapel
Avenue, 163.20 feet to an angle point in same; thence
(7) North 20 degrees 28 minutes 36 seconds West, along same, 17.86 feet to the
point and place of beginning.
BEING shown and designated as Lots 2 and 3, Block 176.01, Plate 18 on the
Township of Cherry Hill Tax Map.
