Securities and Exchange Commission
Washington, D.C 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15 (d) of Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) June 12,
1998 (May 29, 1998)
VERMONT PURE HOLDINGS, LTD.
(Exact name of registrant as specified in its charter)
Delaware 1-11254
(State or other jurisdiction of incorporation) (Commission File No.)
Route 66, P.O Box C
Catamount Industrial Park
Randolph, Vermont 05060
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (802) 728-3600
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Item 2. Acquisition or Disposition of Assets
On May 29, 1998 Vermont Pure Springs, Inc., a Delaware corporation ("Vermont
Pure"), a wholly owned subsidiary of Vermont Pure Holdings, Ltd., a Delaware
corporation ("Holdings"), consummated the purchase of customer lists, vehicles,
cooler and brewer equipment, 5 gallon bottles, crates, and office equipment from
Perrier Group of America ("Perrier"). The purchase was accomplished through the
execution of an asset purchase agreement between the companies. Perrier, based
in Greenwich, Connecticut, is principally engaged in the bottling, sale, and
distribution of spring water throughout the nation. The respective purchase and
sale of the assets relates only to Perrier's distribution business in the Albany
region of New York.
Under the terms of the agreement, Vermont Pure paid cash totaling $2,500,000 for
the assets and assumed liabilities of $138,000. The Company also assumed
operating leases for the vehicles acquired. Vermont Pure incurred approximately
$150,000 as closing costs for the transaction. The total number of customers
acquired was approximately 4,000.
Vermont Pure and Holdings borrowed $2,575,000 from CoreStates Bank under the
terms of their acquisition line of credit to finance the transaction. The line
is for a term of five years with interest to be paid monthly and the principal
balance due at the end of the term. The interest rate of the loan is LIBOR plus
2.50%. The loan is secured by a pledge of all the assets of the Company
including those acquired in the transaction.
The acquisition serves to strengthen Vermont Pure's market position in the
Albany, New York region. The Company acquired Excelsior Spring Water Company of
Saratoga , New York in August 1997 in order to penetrate the market. In May
1998, it added 330 additional customers by acquiring Vermont Naturals of Clifton
Park, New York as well as moving into a new 22,500 square foot warehousing
facility in Halfmoon, New York to accommodate increased production and
distribution. By merging the customer base acquired in this purchase with the
infrastructure already in place, management of Vermont Pure believes they will
be able to leverage operating and distribution efficiencies in order to increase
the profitability of the business as a whole, though no assurance can be given
that this will be successful.
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Item 7. Financial Statements and Exhibits
(a) Financial Statements
No financial statements are required to be prepared or filed
in connection with the acquisition of assets of Perrier.
(b) Pro Forma Financial Information
None required.
(c) The following documents are filed herein as exhibits:
10.1 Asset Purchase Agreement between Vermont Pure and
Perrier dated May 29, 1998
10.2 Mortgage and Security Agreement between Vermont Pure
Springs, Inc. and CoreStates Bank dated April 8, 1998
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EXHIBIT INDEX
Exhibit # Description
10.1 Asset Purchase Agreement between Vermont Pure and Perrier dated
May 29, 1998
10.2 Mortgage and Security Agreement between Vermont Pure Springs, Inc.
and CoreStates Bank dated April 8, 1998
ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT ("Agreement") is entered into on this
12th day of May, 1998, by and between VERMONT PURE SPRINGS, INC. ("VPS") a
Delaware Corporation with its principal place of business in Randolph, Vermont
("BUYER") and THE PERRIER GROUP OF AMERICA, INC. ("PERRIER"), a Delaware
Corporation with its principal place of business in Greenwich, Connecticut
("SELLER").
RECITALS
WHEREAS, VPS is a company engaged in the bottling and sale of natural
spring water with its manufacturing facility and principal place of business in
Randolph Center, VT and
WHEREAS, Perrier is a company, engaged in the bottling and sale of
water with its principal place of business in Greenwich, Connecticut, and
WHEREAS, both parties desire to enter into agreements by which VPS
shall purchase the certain assets of Perrier related to its Home and Office
Bottled Water and Coffee Business in or about Albany, New York ("Alabany
Market") and other assets listed on Exibit "A".
NOW THEREFORE, in consideration of the mutual promises contained
herein, the parties agree as follows:
1. ASSETS
1.1 Asset Purchase and Sale. Seller and Buyer mutually agree for the
Seller to sell, convey, transfer, assign and deliver to Buyer and Buyer to
purchase substantially all of the property of Seller relating to the Home and
Office (Route Distribution) bottled water and coffee Business in or about
Albany, New York, wherever located, tangible and intangible, (the "Business")
consisting of the following assets: vehicles, vehicle leases, purchase orders,
customer contracts, customer lists, inventory, and goodwill. (The assets being
purchased and sold hereunder are sometimes referred to collectively as "Assets"
and are identified in Exibit "A"). Assets of Seller not on the list are being
retained by Seller, including specifically, and without limitation, accounts
receivable arising out of sales on or before the Closing Date (as hereinafter
defined).
1.2 Bill of Sale. Title to the Assets will be conveyed to Buyer by
Seller pursuant to a Bill of Sale, free and clear of all liens and encumbrances
except for approximately $138,000 in bottled deposits which are being assumed by
Buyer. The Form of the Bill of Sale shall be prepared by Buyer's counsel prior
to the Closing Date.
1.3 Assumption of Liabilites. Buyer agrees to assume only those
certain operating liabilities as set forth in Schedule "B".
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2. PURCHASE PRICE
2.1 Purchase Price: $2,500,000.00, provided that:
(i) $2,500,000.00 of the Purchase Price to be
paid in cash, by wire transfer of immediately available funds, at Closing
subject to adjustments as more fully set forth in subsection 2.1 (ii) herein.
(ii) The parties agree that the aforementioned purchase price
is based on a customer base of 3,978 cooler/D.W.S. (Customer to be defined by
the number of coolers/D.W.S equipment.) Seller will provide a verification of
Customers two (2) days prior to Closing and an adjustment of $500.00 per
customer plus/minus 3,978 customers will be made at Closing.
(iii) The parties agree that the aforementioned purchase price
is based on assets other than a customer base of 3,798 cooler/D.W.S Customers
valued at $533,195.00 as more fully set forth in Schedule A. Seller will provide
a verification of this portion of the Assets two (2) days prior to Closing and
an adjustment will be made for Assets missing at Closing.
(iv) Contingent consideration in the form of cash in an amount
equal to actual sales of small package (PET) sales by VPS from the acquired
customer list during the first year of operation of the Business commencing on
the Closing Date and terminating on the first anniversary of the Closing Date.
Payment, including simple interest calculated at the annual rate of 6% from the
Closing Date, will be paid within thirty days following the first anniversary of
the Closing Date. Buyer shall provide Seller with a reasonable written
accounting to support the calculation of the contingent consideration. In the
event that the parties cannot agree upon the accounting the determination of the
contingent consideration shall be made by KPMG-Peat Marwick whose fees shall be
equally shared by the parties.
(v) Buyer shall be responsible for all sales
taxes arising out of the Transaction.
3. EXCLUDED SECURITIES AND LIABILITIES
3.1 It is agreed and understood that this is a purchase and sale of
assets (with limited assumption of certain operating liabilities). The
securities of the Seller are expressly excluded from this transaction. All
liabilities not enumerated in Schedule B, including without limitation, Utility,
Taxing Authority and Employment Claims are expressly excluded (except for sales
tax arising out of the Transaction).
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4. CONDUCT OF BUSINESS AND CONDITION OF PREMISES
PENDING CLOSING
4.1 Prior to the closing:
4.1.1. The business of Seller will be conducted only in the
ordinary course, in accordance with all laws and regulations of the township,
state, and federal governments, and Seller shall not violate the terms of any
existing leases or contracts.
4.1.2. Seller will continue to operate the business in the
manner heretofore operated by Seller. Until the Closing Date, a representative
of the Buyer shall have the right, during normal business hours, to visit the
Seller's place of business to examine Seller's books and records and to observe
the operation of the business.
4.1.3. Seller will keep all of the Assets and the Premises
fully insured against any loss, either by fire, other casualty or theft until
the time of Closing.
4.1.4. Seller will use their best efforts to preserve Seller's
organization relating to Business, and to preserve friendly relations with its
customers and trade creditors. Seller will assume all responsibility toward its
employees and their representative and Buyer assumes no responsibility for their
employment nor their termination of employment as the case may be.
4.1.5. In the event that prior to the date of Closing, the
Assets shall be totally or substancially lost or damages by fire or any other
casualty, the Buyer shall have the option to terminate this agreement or waive
the diminution in value and close under this Agreement buying the Assets "as
is", in which latter event it shall be entitled to treat the proceeds of any
insurance paid to Seller by reason of such loss or damage (excepting insurance
for lost profits, if any), as a payment on the purchase price or the Buyer shall
have the right to all insurance proceeds to apply the funds to repair and/or to
reconstruct the Assets.
5. Closing
5.1 ("Closing") shall take place on or before May 31, 1998 ("Closing
Date") and on the date and time set forth by written notice from the Buyer to
the Seller at least ten (10) days in advance thereto or otherwise as the parties
may agree.
5.2 Closing shall be held by telephone and the parties agree to accept
facsimile signatures and signed counterparts, to effectuate Closing. Original
documents will follow Closing.
5.3 Time shall be of the essence of this Agreement.
5.4 Any Closing adjustments shall be apportioned pro rata as of the
date of Closing.
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6. BULK SALES ACT.
6.1 Buyer and Seller waive compiance with the applicable Bulk Sales
Act. Seller and its majority shareholder shall indemnify and hold Buyer harmless
for any loss to Buyer arising out of such non-compliance. Seller will execute
and deliver, at Closing Date, if requested by Buyer, an indemnification
agreement in accordance with this paragraph.
7. SELLER'S WARRANTIES.
7.1 The Seller represents and warrants to Buyer that as of the date of
this Agreement and as of the date of the Closing, that:
7.1.1 The Seller is a corporation duly organized and existing
in good standing under the laws of the State of Delaware with the corporate
power to own its assets and carry on it business as is now being conducted.
7.1.2. Seller has good and marketable title and the right of
sole possession and control of all the Assets being sold pursuant to this
Agreement, and that such Assets at the time of Closing will not be subject to
any mortgages, pledges, liens, encumbrances, security interest, or charges,
except as described in Schedule B.
7.2 The Seller represents that to the best of the Seller's knowledge,
information and belief (with respect to the Business):
7.2.1 The Seller is in compliance with all applicable laws,
ordinances, rules, regulations, and requirements of all governmental authorities
having jurisdiction therof, and that Seller has complied with all laws municipal
ordinances, and regulations of all governmental authorities having jurisdiction
thereof, and that Seller has complied with all laws, municipal ordinances, and
regulations applicable to Seller and in the ownership of the assets and the
Business hereunder.
7.2.2 There are no actions, suits, or proceedings pending or
threatened against Seller, which affect the Business or Assets either at law or
in equity, brought by any federal, state, or municipal or other governmental
agency, department, board, bureau, or other instrumentality.
7.2.3 All federal, state, and local tax returns required to be
filed have been filed, all deficiencies proposed have either been paid or
settled or are included in an account for accrued taxes; all withholding,
unemployment, social security, excise interest have been paid or will be paid by
Seller after Closing.
7.2.4 All financial information information provided to the
Buyer is accurate and in accordance with the books and records of the Company,
and fairly represents the financial condition, assets and liabilities of the
Company.
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7.2.5 Neither Seller nor any direct or indirect shareholder
thereof has made any agreement or taken any action which might cause anyone to
become entitled to a broker's fee or commission.
7.2.6. Seller and buyer agree that the acounts receivables
will remain the property o fthe Seller; however, Seller hereby warrants that it
will provide an accounting to the Buyer of all receivables mistankenly received
by the Seller for sales made and/or services rendered subsequent to the Closing
Date.
7.2.7 Seller and Buyer agree that the 800 telephone number
utilized by the seller in connection with the Business will remain the property
of the Seller; however, Seller hereby warrants that following the Closing Date,
it will implement a call-forwarding service on an 800 number more fully
described in Exhibit C.
7.3 If Seller obtains any knowledge or information between the date
hereof and Closing, making or indicating that any of the aforesaid warranties or
representations are no longer true, or indication that any of the
representations and conditions set forth in this Section 7 hereof are not true
and cannot be made true by the Seller by the time of Closing, or will no longer
be true as of the date of Closing, Seller will promptly notify Buyer of such
change in circumstances.
8. BUYER'S WARRANTIES
8.1 As an inducement to the Seller to enter into this Agreement and to
consummate the transactions contemplated herein, the Buyer represents and
warrants to the Seller and agrees as follows:
a. Organization. The Buyer is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware.
b. Authority. This Agreement and the transactions contemplated
herein have been duly approved by all necessary corporate action on the part of
the Buyer. This Agreement, when executed and delivered by the Buyer, and
assuming due execution hereof by the Stockholder will constitute the valid and
binding agreement of the Buyer enforceable in accordance with its terms. Neither
the execution nor the delivery of this Agreement, nor the consummation of the
transactions contemplated herein, nor compliance with nor fulfillment of the
terms and provisions hereof, will (i) conflict with or result in a breach of the
terms, conditions or provisions of or constitute a default under the governing
instruments of the Buyer, any instrument, mortgage, agreement, judgement, order,
award, decree or other restriction to which the buyer is a party or by which the
Buyer is bound or any statute or regulatory provisions affecting it or (ii)
require the approval, consent, or authorization of or any filing with or
notification to any federal, state or local court, governmental authority or
regulatory body. The Buyer has full power and authority to purchase the Stock
pursuant to this Agreement and to do and perform all acts and things required to
be done by the Buyer under this Agreement.
<PAGE>
c. Brokers. Buyer has paid or shall pay any fee or
commission to any broker, finder or intermediary for or on account of the
transactions provided for in this Agreement.
d. No Omissions. None of the representations or warranties of
the buyer contained herein and none of the other information or documents
furnished to the seller by the Buyer or its representatives in connection with
this Agreement is false or misleading in any material respect or omits to state
a fact herein or therein necessary to make the statements herein or therein not
misleading in any material respect; to the best knowledge of the Buyer, there is
no fact ehich adversely affects, or in the future is likely to adversely affect,
the business or assets of the Buyer in any material respect which has not been
disclosed in writing to the seller.
e. Financial Ability. The buyer has the financial
resources and ability to meet each of its obligations under this Agreement,
whether due at Closing or after Closing, in a timely manner and withour default.
8.2 Opinion of Counsel. At the closing, the Buyer shall deliver to the
seller an opinion of Ledgewood Law Firm, P.C., counsel for the Buyer, in form
and substance satisfactory to the Seller and its counsel, to the effect that (i)
the Buyer is a corporation duly organized, validly existing and in good standing
under the laws State of Delaware; and (ii) this Agreement and the transactions
contemplated herein have been duly approved by all necessary corporate action of
the Buyer and such Agreement, assuming due execution by the seller, is the valid
and binding agreement of the Buyer enforceable against the Buyer in accordance
with its terms except as enforcement of such agreement may be limited by
bankruptcy, insolvency or other similar laws affecting creditors' rights
generally and, (iii) neither the execution and delivery of this agreement, nor
the consumation of the transactions contemplated herein, (a) violates or
conflicts with or results in the breach of the terms, conditions or provisions
of, or constitutes a default under, the Certificate of Incorporation or Bylaws
of the Company or any agreement or instrument known to such counsel to which the
Buyer is a party or by which either of them is bound or (b) requires the
consent, approval or authorization of or any filing with or notification to any
Federal, state or local court, governmental authority or regulatory body not
already obtained or made, as the case may be. In giving such opinion, counsel
for the Buyer may rely, as to matters of fact, upon certificates of officers of
the Buyer.
9. CONDITIONS PRECEDENT
All obligations of the Buyer under this agreement are subject to
fulfillment, prior to or at Closing, of each of the following conditions:
9.1 Due Diligence. Buyer has been afforded the opportunity to conduct
due diligence on the business and operations of the Seller and is satisfied, in
its reasonable discretion, that the business is as represented to VPS prior to
entering into this Agreement.
9.2 Representation and Warranties. The representations and
warranties of Seller contained in this Agreement being true at the time of
closing as though such representations and warranties were made at such time.
<PAGE>
9.3 Compliance with Agreement. Seller shall have performed and complied
with all agreements and conditions required by this Agreement to be performed or
complied with by prior to or at Closing.
9.4 Opinion of counsel. Seller shall have delivered to Buyer, in form
and content satisfactory to Buyer's counsel, an opinion of its counsel issued to
Buyer to the effect that:
9.4.1 Seller has been duly incorporated and is existing as a
corporation in good standing under the laws of the State of Delaware.
9.4.2 This transaction and its terms do not violate any
provisions of Seller's Articles of Incorporation or Bylaws;
9.4.3 Seller has taken all shareholder, director and other
actions necessary to authorize the transactions contemplated by the parties
hereto;
9.4.4 Seller has authority to carry on the business
presently being conducted by Company;
9.4.5 Seller has full power and authority to sell, assign and
transfer the Assets sold pursuant to this Agreement.
9.5 Documentation. Negotiation and preparation of definitive documents,
including all collateral documents, governing the transactions contemplated
herein under terms and conditions acceptable to Buyer's and Seller's counsel.
9.6 Financing. Buyer obtains financing for the purchase of assets
herein described on terms acceptable to Buyer.
9.7 Seller's Shareholder Approval. Seller shall have obtained
any necessary Shareholder approval for this transaction.
10. NONDISCLOSURE O FCONFIDENTIAL INFORMATION
10.1 Seller and its directors, shall not, during the term of this
Agreement or at any time for a period of two years following Closing, unless
authorized to do so in writing by the Buyer, directly or indirectly disclose or
permit to be known to , or used for the benefit of , any person, corporation or
other entity (outside of the employ of the Company), or itself, any confidential
information. For the purposes of this Section 10, the term confidential
information shall include, but not limited to, confidential or proprietary
knowledge or information with respect to the conduct or details of the Seller's
Business or relating to the Assets including, but not limited to, lists of
customers of the Buyer's Business, pricing strategies, or marketing methods.
Confidential information does not include matters which are generally known
outside of the Buyer, public knowledge or in the publice domain.
<PAGE>
10.2 All confidential information described in section 10.1 shall be
the exclusive property of the Buyer, and Seller shall use its best efforts to
prevent any publication or disclosure thereof.
10.3 The provisions of this Section 10 shall survive the Closing and
shall continue for a period of two (2) years.
11. RESTRICTIVE COVENANT
In order to protect the Buyer in its full beneficial use and enjoyment
of the goodwill, assets, business relationships, marketing techniques and other
know-how acquired as a result of this Agreement, for a period of three (3) years
after the Closing of this Agreement, Seller, including its officers and
directors will not, within the Albany Market, directly or indirectly compete
with the Buyer in the Business or the home/office water and coffee delivery
business, and will not either (i) solicit any persons or entities known to be
customers of the Buyer to purchase any of the aforementioned products; or (ii)
solicit or induce any employee of the Buyer to leave such employment to take a
position with the Seller or with any company for which any officer or director
then works. During the aforesaid period, Seller shall not make any statements or
commit any acts (including contacting any of the Buyer's customers that would in
any way be tortiously injurious or detrimental to the Company's image, business
or customer relations. The provisions of this Section 10 shall survive the
termination, for any reason, of this Agreement and shall continue for the three
(3) year period contemplated by this Section 10. Seller specifically reserves
the right and intends to remain in the business of selling retail bottled water
products in the Albany Market in any size or container in any other manner it
deems appropriate provided that sales are not made via the home/office water and
coffee delivery business.
12. REMEDIES.
Seller acknowledges that their promises with respect to the
Agreement not to compete and to maintain the confidentiality of information in
accordance with this Agreement are promises of a special, unique, ususual,
extraordinary and intellectual character, which give them peculiar value the
loss of which cannot be reasonably or adequately compensated in an action of
law, and that, in the event there is a breach hereof by Seller, the Company eill
suffer irrepatable harm, the amount of which will be impossible to ascertain.
Accordingly, the Company shall be entitled, if it so elects, to institute and
prosecute proceedings in any court of competent jurisdiction, either at law or
in equity, to obtain damages for any breach or to enforce specific performance
of the provisions or to enjoin Seller from commiting any such act in breach of
this Agreement. The remedies granted to the Buyer in this Agreement are
cumulative and are in addition to remedies otherwise available to the Buyer at
law or in equity. If the Buyer is obliged to resort to the courts for the
enforcement of a covenant of Seller contained in Section or, such covenant shall
be extended for a period of time equal to the period of such breach which
extension shall commence on the later of (i) the date on which the original
(unextended) term of such covenant is scheduld to terminate or (ii) the date of
the final court order (without further
<PAGE>
right of appeal) enforcing such covenant.
13. GOVERNING LAW
This Agreement shall be construed, interpreted and enforced in
accordance with the laws of the state of New York exclusive of its conflict of
laws and provisions. The parties agree that venue shall lie in White Plains, New
York and shall to jurisdiction of an appropriate court located in the city.
14. TERMS SEVERABLE
In the event that any term or provision hereof or the application
thereof to persons or circumstances shall to any extent be invalid or
unenforceable, then the remainder of this Agreement shall not be affected
thereby and each term or provision hereof shall be valid and enforced to the
fullest extent permitted by law.
15. SURVIVAL OF TERMS.
The terms of this Agreement, including but not limited to the
warranties, representations and covenants made by the parties hereto, shall
survive for a period of one (1) year from the Closing Date and the Seller shall
remain liable for any deficiency arising from any breach of the same during such
period.
16. FORCE MAJEURE.
The failure of or delay in compliance with any of the terms and
conditions of this Agreement by either party shall be excused if said failure or
delay is due to an Act of God, fire, flood, strike, labor dispute, accident, act
of government or any similar cause beyond the reasonable control of said party.
17. ENTIRE AGREEMENT.
This Agreement, including the Preambles, and any other document or
exhibit incorporated herein by reference sets forth the entire understanding of
the parties. It shall not be changed or terminated orally. This Agreement may be
executed in one or more counterparts each of which shall be deemed an original
but all of which together shall constitute one and the same document.
<PAGE>
18. NOTICE.
Notices required under this Agreement shall be in writing sent by
certified mail and facsimile to the representatives of the parties as follows:
Vermont Pure Springs, Inc.
Route 66
Randolph Center, VT 05061
Attn:Timothy Fallon
Facsimile (802) 728-4614
With Copy to:
Kevin F Berry, Esquire
Ledgewood Law Firm
1521 Locust Street
Philadelphia, PA 19102
Facsimile (215) 735-2513
To Seller:
The Perrier Group of America, Inc.
777 West Putnam Avenue
Greenwich, CT 06870
Attn: Tim Muttit and Mark Evans
Facsimile (203) 863-0250
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this agreement as
of the day, month and year first written above.
WITNESS: VERMONT PURE SPRINGS, INC.
By:
Name:
Title:
WITNESS: THE PERRIER GROUP OF AMERICA, INC.
By:
Name:
Title:
Commercial-Industrial
Mortgage and Security Agreement
This Mortgage made the 8th day of April 1998, between Vermont Pure Springs,
Inc.( hereinafter called "Mortgagor") and CoreStates Bank, N.A.*, a national
banking association( hereinafter called "Mortgagee").
Witnesseth:
Mortgagor does hereby grant, convey and mortgage unto Mortgagee the real
property (hereinafter called "land") located in Orange County Vermont described
in Exhibit A attatched hereto and made a part hereof.
Together with any and all buildings and improvements erected or hereinafter
erected thereon.
Together with any and all fixtures, and all machinery, equipment, and other
articles of property, whether real estate or not, now or at any time hereafter
attatched to or situated in or upon, and used or useful in the operation of, the
land or the buildings and improvements erected or hereafter erected thereon
or of any business now or hereafter operated by the owner or any occupant of the
mortgaged land or any part thereof.
Together with all building materials, fixtures, machinery and equipment
delivered on site to the land during the course of construction of any buildings
or improvements or thereafter, if intended for addition thereto, or
incorporation therein or thereon, or if suitable for any such use.
Together with all and singular the tenements, hereditaments and
appurtenances belonging to the land or any part thereof, hereby mortgaged or
intended so to be, or in anywise appertaining thereto (including but not limited
to all income, rents and profits arising therefrom), all streets, alleys,
passages, ways, watercourses, all other rights, liberties and privileges of
whatsoever kind or character, the reversions and remainders, and all the estate,
right, title, interest, property, possession, claim and demand whatsoever, as
well at law as in equity, of Mortgagor, in and to all of the foregoing or any or
every part thereof (said Land, buildings, improvements, fixtures, machinery,
equipment, tenements, and other property interests being hereinafter
collectively called "Premises")
To have and to hold the premises unto the Mortgagee, its successors and
assigns forever, in fee. This Mortgage and the rights in the premises hereby
granted shall secure the Mortgagor's obligation to pay or perform the following:
(a) A certain loan made by Mortgagee to mortgagor, evidenced by a notes
dated April 8, 1998 (the "Note") and any renewals, extensions or modifications
thereof, the terms and conditions of which are incorporated herein by reference,
in the principal sums of, in the aggregate, Fifteen Million Dollars (
$15,000,000) together with interest at the rate specified therein.
(b) All ammounts expended by Mortgagee in the performance by it of any
obligation of Mortgagor contained in this Mortgage or in the Note which
Mortgagee elects to make due to the failure of Mortgagor to perform the same
together with all interest thereon.
<PAGE>
(C) All ammounts expended by Mortgagee, including costs or expenses
incidental thereto, in connection with the completion of any building or other
improvements to the Premises, if the loan or any part therof is being obtained
or advanced for the purpose of financing the construction of improvements.
(d) All costs, expenses and reasonable attorney's fees incurred in the
collection of the obligations secured by this Mortgage or in the protection,
perfection or enforcement of the Mortgagee's rights hereunder.
(e) All other obligations of Mortgagor to Mortgagee, whether now existing
or hereinafter incurred, arising out of any other agreement or document securing
or executed in connection with the indebtness evidenced by the Note (such other
agreement or document being hereinafter called a "Collateral Agreement")
Until the entire indebtness of the Note and all other sums secured by this
Mortgage are paid in full, Morgagor covenants and agrees with Mortagagee as
follows:
1. Warranty of Title, Lien Priority. Mortgagor warrants and will warrant
specially the property hereby conveyed; that this Mortgage is and shall continue
to be a lien on the Premises, title to which shall be good and marketable and at
all times owned in fee simple by Mortgagor, subject to no other liens or
encumbrances except those, if any disclosed on Exhibit 6.09 of the Loan and
Security Agreement of even date between Mortgagor and Mortgagee, as supplemented
and amended (the "Loan Agreement") or otherwise permitted in writing by the
Mortgagee.
2. Payment of Sums Secured. Mortgagor shall pay to Mortgagee the principal
of and interest upon the Note according to the terms of the Note secured hereby,
reasonable charges fixed by Mortgagee to satisfy and discharge this Mortgage of
record, and all other sums hereby secured; and shall keep and perform every
other covenant and agreement of such Note and this Mortgage.
3. Waste, Maitenance, Compliance and Inspection. Mortgagor shall abstain
from and not permit the commission of waste in or about the Premises; shall not
remove or demolish, or alter the structural character of, any building at any
time erected on the Premises without the prior written consent of Mortgagee;
shall maintain the Premises in good condition and repair, reasonable wear and
tear excepted; and shall comply with all laws, ordinances and regulations
affecting the Premises; provided, however, that if Mortgagor shall in good
faith, and by proper legal action promptly initiated, contest any such law,
ordinance or regulation, or the validity thereof, then Mortgagor shall not be
required to comply therewith so long as such contest operates to prevent
enforcement, and is maintained and prosecuted with the diligence, and shall not
have been terminated or discontinued adversely to Mortgagor. Mortgagee shall
have the right, but not the duty, to enter upon the Premises at any reasonable
hour to inspect the order, condition and repair thereof.
4. Insurance. Mortgagor shall keep the buildings and improvements on the
Land continuously insured against loss by fire, with extended coverage, in such
total amount as Mortgagee may from time to time require (but such amount shall
in no event exceed the full fair insurable value of said buildings and
improvements), business interruption insurance, and against other hazards as
Mortgagee may reasonably require including, but not limited to flood insurance.
The policy or policies for such insurance shall be maintained in full force and
effect until such time as the indebtness hereby secured is fully repaid. All
policies, including but not limited to policies for any amounts carried in
excess of the aforesaid minimum and policies not specifically required by
Mortgagee, shall be with an insurance company or companies, and in form,
satisfactory to Mortgagee, and shall be deposited, premiums paid, with
Mortgagee. The loss, if
<PAGE>
any, shall be payable to Mortgagee according to the terms of a standard
mortgagee clause, not subject to contribution, or of such other form as shall be
satisfactory to Mortgagee. Mortgagee shall have the right to apply the proceeds
of any such insurance, at its election, either to reduce the indebtness secured
hereby or to restore the Premises. All renewal policies shall be delivered,
premiums paid, to Mortgagee at least ten days before the expiration of the old
policies. If Mortgagee becomes the owner of the Premises or any part thereof by
foreclosure or otherwise, such policies shall become the absolute property of
Mortgagee.
5. Taxes and Other Charges. Mortgagor shall pay all real estate taxes,
water and sewer rents, other similar claims and liens assessed or which may be
assessed against the Premises or any part thereof, without any deduction,
defalcation or abatement, not later than thirty days before the dates on which
such taxes, water and sewer rents, claims and liens commence to bear interest or
penalties, and not later than such dates shall produce to Mortgagee receipts for
the payment thereof in full and shall pay every other tax, assessment,claim,
lien or encumbrance which may at any time be or become a lien upon the Premises
prior to the lien of this Mortgage; provided, however, that if the Mortgagor
shall in good faith, and by proper legal action promptly initiated, contest any
such taxes, claims, liens, encumbrances or other charges, or the validity
thereof, and shall have established on its books, or by deposit of cash with
Mortgagee (as Mortgagee may elect), a reserve for the payment thereof in such
amount as Mortgagee may require, then Mortgagor shall not be required to pay the
same, or to produce such receipts, during the maintenance of said reserve and as
long as such contest operates to prevent collection and no lien shall be filed
against the Premises, and is maintained and prosecuted with diligence, and shall
not have been terminated or discontinued adversely to Mortgagor.
6. Escrow Funds. Without limiting the effect of Paragraphs 4 and 5 hereof,
upon the request of Mortgagee, Mortgagor shall pay to Mortgagee monthly at the
time when such monthly installment of principal and interest is payable, an
amount equal to 1/12 of the annual premiums for such fire and extended coverage
insurance and such annual real estate taxes, water rents, sewer rents, special
assessments, and any other tax, assessment, claim, lien or encumbrance which may
at any time be or become a lien upon the Premises prior to the lien of this
Mortgage, and on demand from time to time shall pay to Mortgagee additional sums
necessary to pay such premiums and other payments, all as estimated by
Mortgagee, in its reasonable discretion, the amounts so paid to be security for
such premiums and other payments and to be used in payment therof. No amount so
paid shall be deemed to be trust funds but 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 said principal debt remaining
becomes due and payable, Mortgagee shall have the right at its election to apply
any amounts so held against the entire indebtness secured hereby.
7. Future Impositions. If at any time the United States Government or any
department or bureau thereof shall require internal revenue stamps on the Note
secured hereby, upon demand Mortgagor shall pay for same; and on default of such
payment within 15 days after demand for same, the holder of the Note may pay for
such stamps and add the amount so paid to the principal indebtness evidenced by
the Note and secured by this Mortgage, and said additional principal shall bear
interest at the rate of 2% per annum in excess of the rate set forth in the Note
("Default Rate"). If any law or ordinance adopted hereafter imposes a tax on
Mortgagee with respect to the Premises, the value of the Mortgagor's equity
therein, the amount of the indebtness secured hereby, the Note, or this
Mortgage, Mortgagee shall have the right at its election from time to
<PAGE>
time to give Mortgagor 60 days written notice to pay such indebtness secured
hereby, whereupon such indebtness shall become due, payable and collectible at
the expiration of such period of 60 days, unless prior thereto, lawfully and
without violation of usury laws, Mortgagor has paid any such tax in full as the
same became due and payable, in which event such notice shall be deemed to have
been rescinded with respect to any right of Mortgagee herunder arising by reason
of the tax so paid. Any prepayment of the indebtness secured hereby pursuant to
any such notice shall be subject to the prepayment provisions contained in the
Note.
8. Security Agreement: Additional Security. This Mortgage creates a
security interest in the property included in the Premises and constitutes a
security agreement under the Uniform Commercial Code. Mortgagor shall execute,
file and refile such financing statements or other security agreements as
Mortgagee shall require from time to time with respect to property included in
the Premises. See Addendum A attatched hereto.
9. Leases. No existing or future lease for a term in excess of two years,
or at an annual rent in excess of $5,000, or which affects more than ten percent
of the gross income of the Premises, and which covers the Premises or property
or any part thereof, or any facilities or business located or operated thereon
or therefrom, shall be cancelled, surrendered or modified without the written
consent of Mortgagee. Mortgagor shall notify the Mortgagee immediately of any
default asserted by any tenant. If Mortgagor fails to cure such default on its
part, as landlord in any of the leases, then Mortgagor expressly authorizes
Mortgagee, at its option, to cure such default in order to prevent termination
of any lease by any tenant. If any such lease is asssigned to Mortgagor by
seperate instrument of assignment, and if, by reason of default of Mortgagor in
the performance of any such lease, the tenant has the right to cancel such lease
or to claim any diminution of or offset against further rents, then, at the
opition of Mortgagee, such default shall be a default under the Note and this
Mortgage.
10. Right to Remedy Defects. If Mortgagor fails to pay any tax, claim, lien
or encumbrance which shall be or become prior in lien to this Mortgage, or to
pay any insurance premium as aforesaid, or to keep the Premises in repair, as
aforesaid, or commits or permits waste, then Mortgagee, at its option, may pay
said claim, lien, encumbrance, tax, assessment or premium, with right of
subrogation thereunder, may make such repairs and take such steps as it deems
advisable to prevent or cure such waste, and may appear in any action or
proceeding with respect to any of the foregoing and retain counsel therein, and
take such action therein as Mortgagee deems advisable, and for any of said
purposes Mortgagee may advance such sums of money as it deems necessary.
Mortgagor will pay to Mortgagee, immediately and without demand, all sums of
money advanced by Mortgagee pursuant to this paragraph, together with interest
on each such advance at the Default Rate and all such sums and interest thereon
shall be secured hereby.
11. Condemnation. If any part of the Premises is condemned, except as
hereinafter provided in this covenant, all proceeds shall be applied first to
pay the indebtness secured hereby. No settlement for the damages sustained
thereby shall be made by Mortgagor without Mortgagee's prior written approval
thereof. If the amount of an initial award of damages for the condmnation is
insufficient to pay the amount of the indebtness secured hereby in full with
interest and costs, Mortgagee shall have the right at its sole option, to file
an appeal or such other legal proceedings as legal counsel may advise to be
appropriate under the circumstances in the name of Mortgagor or of Mortagee (for
which action Mortgagee or such counsel as it chooses is hereby irrevocably
appointed attorney in fact for Mortgagor), and to prosecute same to final
conclusion or otherwise dispose thereof, in which event the expenses of the
appeal or other appropriate legal proceedings,
<PAGE>
including but not limited to counsel fees, shall be first paid out of the
proceeds, and no credit shall be given on account of the indebtness secured
hereby other than a credit for the amount, if any, whereby the final proceeds
exceed all such expenses. Nothing in this covenant or elsewhere in this Mortgage
shall limit rights otherwise available at law to Mortgagee, including but not
limited to rights to intervene as a party to any condemnation proceeding.
12. Environmental Matters.
(a) As used in this Mortgage, the following terms shall have the
following meanings:
(I) The term "Environmental Laws" means any and all applicable
federal, state and local environmental laws, rules and regulations whether
now existing ot hereafter enacted together will all amendments, modifications
and supplements thereof.
(II) The term "Hazardous Substance" means any contaminants,
hazardous substances or wastes, pollutants, toxic substances or wastes,
regulated substances or other similar substances or wastes which may be the
subject of liability pursuant to any Environmental Law.
(b) Mortgagor represents and warrants to Mortgagee that (I)to the best of
Mortgagor's knowledge, the Premises and Mortgagor are in full compliance with
the Environmental Laws; (II) Mortgagor has no knowlege of or notice concerning
any potential liability under, or any investigation or proceeding threatened or
pending under the Environmental Laws arising from the ownership or operation,
past or present,of the Premises; (II) to the best of the Mortgagor's knowledge
there are no underground or above ground storage tanks on the Premises that have
been used for the storage of petroleum products or any Hazardous Substance nor
to the best of Mortgagor's knowledge, have any such tanks been located on the
Premises at any time; and (IV) there is no evidence of any release, discharge or
pollution from any petroleum products or any Hazardous Substance on the
Premises.
(C)Mortgagor covenants and agrees that (I) Mortgagor shall not, and shall
not permit any other person to, locate, store, generate, manufacture, process,
distribute, use, treat, transport, handle, dispose of, emit, discharge or
release any Hazardous Substance on, from or with respect to the Premises
(Mortgagor may use, store and dispose of cleaning materials and office supplies
in the ordinary course of the Mortgagor's business in reasonable quantities and
in compliance with Environmental Laws); (II) Mortagagor shall immediately notify
Mortgagee of any violation of or potential liability under the Environmental
Laws; (III) Mortgagor shall immediately comply with any order, action or demand
of any governmental agency or legal or administrative agency having jurisdiction
over the Premises to clean and remove any Hazardous Substance from the Premises
and to pay for such clean up, removal and associated costs, fines and penalties;
and (IV) Mortgagor shall otherwise comply will all Environmental Laws and laws
relating to the storage, handling and disposing of petroleum products.
(d) At any time or upon or after the occurrence of an Event of Default or
potential Event of default, Mortgagee shall have the right, but not the
obligation, to conduct or cause to be conducted by any other person designated
by the Mortgagee, and environmental audit or similar assessment concerning the
Premises and its compliance with Environmental Laws and to ascertain the
existence of Hazardous Substances on the Premises. All costs and expenses
associated with such audit or assessment shall be paid for as provided in
section 4.04 of the Loan Agreement. Mortgagee and its designees are authorized
to enter upon the Premises to perform such audit or assessment and to conduct
all tests necessary including above and below ground tests. If such audit,
assessment or other inquiry reveals the existence of any Hazardous Substances or
noncompliance with Environmental Laws, Mortgagee, at Mortgagor's expense,
<PAGE>
shall have the right, but not the obligation, to cause the Premises to be
treated by persons designated by Mortgagee, as is necessary in Mortgagee's
reasonable opinion, to cause the Premises to comply with Environmental Laws and
to be free of Hazardous Substances. Any cost or expense arising from any audit,
assessment or other inquiry and from any treatment not paid by Mortgagor may be
paid by Mortgagee. Mortgagor will pay to Mortgagee immediately, and without
demand, all sums of money advanced by Mortgagee pursuant to this paragraph
together with interest on any such advance at the Default Rate and all such sums
and interest thereon shall be secured hereby.
(e) Mortgagor shall defend, indemnify, and hold harmless Mortgagee and its
directors, officers, agents and employees, from any and all liabilities
(including strict liability), actions, demands, penalties, losses, costs, or
expenses (including without limitation reasonable attorneys' fees and expenses,
and remedial costs), suits, costs of any settlement or judgement, and claims of
any and every kind whatsoever which may now or in the future (whether before or
after the satisfaction of this Mortgage) be paid, incurred, or suffered by or
asserted against Mortgagee by any person or entity or governmental agency for,
with respect to, or as a direct or indirect result of, the presence on or under,
or the escape, seepage, leakage, spillage, discharge, emission, or release from
the Premises of any Hazardous Substances or arise out of or result from the
environmental condition of the Premises or the violation of any Environmental
Laws regardless of whether or not caused by or within the control of Mortgagor
or Mortgagee. The representations, covenants, warranties, and indemnifications
contained in this paragraph shall survive the satisfaction and payment in full
of this Mortgage.
(f) (I) Mortgagor represents and warrants to Mortgagee that no part of the
Premises contains, is located in or abuts floodplain, navigable water or any
other body of water, tideland, marshland, wetland or other area (collectively,
"Protected Area":) which is subject to special state, federal or municipal
regulation, control or protection; (II)Mortgagor shall comply with all laws,
ordinances and regulations pertaining to Protected Areas, to the extent
apllicable to the premises.
13. Notices. Mortgagor shall notify Mortgagee within three (3) days of the
occurrence of (I) fire or other casualty causing damage to the Premises; (II)
receipt of notice from any governmental authority relating to the structure, use
or occupancy of all or any part of the Premises or relating to; the condemnation
thereof; (III) substancial change in the use or occupancy of all or any part of
the Premises; (IV) receipt of any notice from the holder of any lien or security
interest in all or any part of the Premises; or(V) commencement of any
litigation which is substancial in amount or which, if determined adversely,
would have a material adverse effect on the financial condition of Mortgagor or
affecting all or any part of the Premises.
14.Default and Remedies. The occurrence of any Event of Default (after the
expiration of any applicable notice and grace periods) as defined in and under
the Loan Agreement, constitutes and Event of Default under this Mortgage. Upon
the happening of any one or more of said Events of Default, the entire unpaid
balance of the principal, the accrued interest, and all other sums secured by
this Mortgage shall, at the option of Mortgagee, become immediately due and
payable without notice or demand, and in any such Event of Default Mortgagee may
forthwith:
(1) Foreclosure. Institute an action of Mortgage foreclosure, or take
such other action, as the law may allow, at law or in equity, for the
enforcement thereof and realization on the mortgage security or any other
security which is herein or elsewhere provided for, and proceed thereon to final
judgement and execution thereon for the entire unpaid balance of said principal
sum, with
<PAGE>
interest at the rate stipulated in the Note to the date of default and
thereafter at the Default Rate, together with all other sums secured by this
Mortgage, all costs of suit, interest at the Default Rate on any final judgement
obtained by Mortgagee from and after the date of any Sheriff's Sale of the
Premises (which may be sold in one parcel or in such parcels, manner or order as
Mortgagee shall elect) until actual payment is made of the full amount due
Mortgagee, and an attorney's commission for collection which shall be
reasonable, but not less than $5,000, without further stay, any law, usage or
custom to the contrary notwithstanding; or
(2) Entry: Receivership. Enter into possession of the Premises, with or
without legal action, if necessary; lease the same; collect all rents and
profits therefrom and, after deducting all costs of collection and
administration expenses, apply the net rents and profits to the payment of
taxes, water and sewer rents, Charges and claims, insurance premiums and all
other carrying charges (including but not limited to agents' compensation and
fees and costs of counsel and receivers) and to the maintenance, repair or
restoration of the premises, or on account and in reduction of the principal or
interest, or principal and interest, hereby secured, in such order and amounts
as Mortgagee in Mortgagee's sole discretion may elect; and have a receiver
appointed to enter into possession of the Premises, collect the rents and
profits therefrom, and apply the same as the court may direct. Mortgagee and/or
rent receiver shall be liable to account only for rents and profits actually
received by Mortgagee . For such purposes Mortgagor hereby authorizes any
attorney of any court of record to appear for Mortgagor to sign an agreement for
entering an amicable action of ejectment for possession of the Premises, and to
confess judgement therein against Mortgagor in favor of Mortgagee, whereupon a
writ may forthwith issue for the immediate possession of the Premises, without
any prior writ or procedeeding whatsoever; and for so doing this Mortgage or a
copy hereof verified by affidavit shall be a sufficient warrant; or
(3) Take such other action at law or in equity for the enforcement hereof
and recovery of the sums secured hereby. The remedies of Mortgagee as provided
herein and in the Note and in the Collateral Agreement, shall be cumulative and
concurrent and may be pursued singly, succesively, or together against Mortgagor
or the Premises, all at the sole discretion of Mortgagee. The waiver of any
default or failure to enforce any right or to pursue any remedy at any time,
shall not be a waiver of any subsequent default or preclude such enforcement or
pursuit at a subsequent time. See Addendum B attatched hereto.
15. Assignment of Leases and Rents after default. Mortgagor hereby assigns
to Mortgagee all leases already in existence and to be created in the future,
together with all rents due or to become due under existing or future leases.
Mortgagor will not, without prior written consent of the Mortgagee, assign any
lease or rentals thereof now existing or hereafter created on the Premises,
except as herein provided to the Mortgagee. This assignment however, shall be
operative only in the event of the occurrence of a default hereunder, or under
the Note or under any Collateral Agreement, remaining uncured at the expiration
of the grace period, if any, provided above in respect to such default; and in
any such case Mortgagor hereby confers on Mortgagee the exclusive power, to be
used or not in its sole discretion, to act as agent, or to appoint a third
person to act as agent for Mortgagor, with power to take possession of, and
collect all rents arising from, the Premises and apply such rents at the option
of Mortgagee, to the payment of the indebtness secured hereby, taxes, costs of
maintenance, repairs, expenses incident to managing and other expenses, in such
order of priority as Mortgagee may in its sole discretion
<PAGE>
determine, and to turn any balance remaining over to Mortgagor; but such
collection of rents shall not operate as an affirmance of the tenant or lease in
the event Mortgagor's title to the Premises should be acquired by Mortgagee.
Mortgagee shall be liable to account only for rents and profits actually
received by mortgagee. In exercising any of the powers in this paragraph
contained, Mortgagee may also take possession of, and for these purposes use,
any and all personal property contained in the Premises and used by Mortgagor in
the rental or leasing thereof or any part thereof.
16.Counsel Fees. If Mortgagee becomes a party (by intervention or
otherwise) to any action or proceeding affecting the Premises or the title
thereto or Mortgagee's interest under this Mortgage, or employs an attorney to
collect any of the indebtness or to enforce performance of the obligations,
covenants and agreements secured hereby. Mortgagor shall reimburse Mortgagee,
forthwith upon written notice and without further demand, for all reasonable
costs, charges and counsel fees incurred by Mortgagee, in any such case, whether
or not suit be commenced, and the same shall be secured hereby as a further
charge and lien upon the Premises.
17. Notice. A notice which is mailed certified mail return receipt
requested, to Mortgagor or to the person or persons who are then the owner or
owners of the Premises at the Premises or at such other address as Mortgagor
shall designate to Mortgagee in writing or to Mortgagee at its address set forth
herein shall be sufficient notice when required under this Mortgage.
18.Cumulative Rights and Remedies. The rights and remedies of Mortgagee as
provided herein, in the Note, and in any Collateral Agreement, and the warrant
therein contained, shall be cumulative and concurrent, and may be pursued
singly, successively or together at the sole discretion of Mortgagee, and may be
exercised as often as occasion therefor shall occur; and the failure or delay in
exercising any such right of remedy shall in no event be construed as a waiver
or release of the same.
19.Waiver of Defenses and Certain Notices. Mortgagor hereby waives and
releases (a) all errors, defects and imperfections in any proceedings instituted
by Mortgagee under this Mortgage, (b) all benefit that might accrue to Mortgagor
by virtue of any present or future laws exempting the Premises, or any part of
the proceeds arising from any sale thereof, from attachment, levy or sale under
execution, or providing for any stay of execution, exemption from civil process,
or extension of time for payment and (c) all notices not hereinelsewhere
specifically required, of Mortgagor's default or of Mortgagee's exercise, or
election to exercise, any option under this Mortgage.
20.Satisfaction of this Mortgage. If Mortgagor complies with the provisions
of this Mortgage and pays to Mortgagee said principal sum, and all other sums
payable by Mortgagor to Mortgagee as are hereby secured, in accordance with the
provisions of the Note and other obligations secured hereby and in the manner
and at the times therein set forth, without deduction, fraud or delay, then and
from thenceforth this Mortgage, and the estate hereby granted, shall cease and
become void, anything hereinbefore contained to the contrary notwithstanding.
21.Financial Statement. Mortgagor shall deliver to Mortgagee financial
statements of Mortgagor and Mortgagor shall make its business records available
as set forth in the Loan Agreement.
22.Further Assurances. Mortgagor shall, prompltly upon request of
Mortgagee; (I) do all acts and things, including but not limited to the
execution of any further assurances deemed
<PAGE>
necessary by Mortgagee, to establish, maintain and continue the lien created and
intended to be created hereby, all assignments made or intended to be made
pursuant hereto, and all other rights and benefits conferred or intended to be
conferred on Mortgagee hereby and Mortgagor shall pay any costs incurred by
Mortgagee in connection therewith, including all filing and recording costs,
cost of searches, and reasonable counsel fees incurred by Mortgagee and (II)
Furnish Mortgagee with a written certification signed by an officer of the
Mortgagor on Mortgagor's behalf as to all then existing leases covering any part
of the Premises, and the names of the tenants and the rents payable thereunder,
together with executed copies of all such leases
23.Construction. The words "Mortgagor" and "Mortgagee" include singular or
plural, indivisual, partnership, or corporation, and the respective heirs,
executors, administrators, successors and assigns of Mortgagor and Mortgagee, as
the case may be.The use of any gender applies to all genders. If more than one
party is named as Mortgagor, the obligation hereunder of each such party is
joint and several. This Mortgage shall be governed by and contrued in accordance
with the laws of the state where the Premises is located.
24.Captions. The captions herein are inserted only for convenience of
reference and in no way define, limit or describe the scope or intent of this
Mortgage or any particular paragraph or section hereof, nor the proper
construction hereof.
25.Liens. Mortgagor covenants and agrees with Mortgagee that it shall not
mortgage, pledge, hypothecate, incur, grant, or suffer to exist any other lien
on the Premises other than the lien of this mortgage, except for such liens as
are disclosed on Exhibit 6.09 of the Loan Agreement
26. See Addendum C attached hereto
27.WAIVER OF JURY TRIAL - EACH UNDERSIGNED PARTY HEREBY WAIVES, AND
MORTGAGEE BY ITS ACCEPTANCE HEREOF THEREBY WAIVES, TRIAL BY JURY IN ANY LEGAL
PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN
TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF OR RELATED TO THIS
MORTGAGE OR THE RELATIONSHIP ESTABLISHED HEREUNDER. THIS PROVISION IS A MATERIAL
INDUCEMENT FOR MORTGAGEE TO ENTER INTO, ACCEPT OR RELY UPON THIS MORTGAGE.
Any provision of this mortgage which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
