FORM OF MORTGAGE, DEED OF TRUST, ASSIGNMENT OF LEASES AND RENTS, AND SECURITY AGREEMENT
[Select applicable instrument type per jurisdiction: MORTGAGE / DEED OF TRUST]
Prepared by and after recording return to:
[Insert name and address of Borrower's Counsel] [Insert Street Address] [Insert City, State, Zip Code]
Attention: [Insert Contact Name]
Reference: [Insert Loan Reference Number]
Recording Information:
County and State of Recording: [Insert county and state of recording]
Recording Fee / Documentary Stamp Tax: [Insert recording fee / documentary stamp tax information if applicable]
Book/Page or Instrument Number: [Insert book/page or instrument number — to be completed upon recording]
CROSS-REFERENCE
This instrument secures obligations under that certain Credit Agreement dated as of [__], among [Insert Borrower], the Guarantors party thereto, [Insert Administrative Agent], as Administrative Agent and Collateral Agent, and the Lenders party thereto from time to time (as amended, restated, amended and restated, supplemented, or otherwise modified from time to time, the "Credit Agreement").
Property Address: [Insert street address, city, county, state, zip]
Tax Parcel ID(s): [Insert]
MORTGAGE, DEED OF TRUST, ASSIGNMENT OF LEASES AND RENTS, AND SECURITY AGREEMENT
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RECITALS
A. Identification of Parties.
This Mortgage, Deed of Trust, Assignment of Leases and Rents, and Security Agreement (this "Mortgage") is made and entered into as of [__], by and among:
Mortgagor/Grantor/Trustor: [Insert full legal name of the applicable subsidiary entity granting the mortgage], a [Insert entity type] organized and existing under the laws of the State of [Insert jurisdiction of organization] (the "Mortgagor" or "Grantor" or "Trustor," as applicable);
Mortgagee/Beneficiary: [Insert full legal name of Collateral Agent], a [Insert entity type], in its capacity as Collateral Agent for the benefit of the Secured Parties under the Credit Agreement (as defined below) (the "Mortgagee" or "Beneficiary," as applicable); and
Trustee (Deed of Trust Jurisdictions Only): [Insert name of deed of trust trustee], a [Insert entity type], having an address at [Insert address] (the "Trustee"). [Note: The Trustee designation is applicable only in deed of trust states. In mortgage states, all references to the Trustee and to conveyances to the Trustee shall be deleted, and this instrument shall operate as a mortgage.]
B. Description of Credit Agreement.
Reference is hereby made to that certain Credit Agreement dated as of [_], by and among [Insert Borrower], a [Insert entity type] organized and existing under the laws of the State of [Insert jurisdiction of organization] (the "**Borrower**"), the Guarantors party thereto from time to time, [Insert Administrative Agent], a [Insert entity type] (in its capacity as Administrative Agent, the "**Administrative Agent**," and in its capacity as Collateral Agent, the "**Collateral Agent**"), and the Lenders party thereto from time to time (as amended, restated, amended and restated, supplemented, or otherwise modified from time to time, the "**Credit Agreement**"), pursuant to which the Lenders have agreed to extend to the Borrower a senior secured term loan facility in the aggregate principal amount of $[_] (the "Term Loan Facility"), subject to the terms and conditions set forth in the Credit Agreement. In connection with the Credit Agreement, the parties have entered into, among other things, (i) that certain Guarantee Agreement dated as of [_] (as amended, restated, amended and restated, supplemented, or otherwise modified from time to time, the "**Guarantee Agreement**"), among the Borrower, each of the Guarantors party thereto, and the Collateral Agent, and (ii) that certain Pledge and Security Agreement dated as of [_] (as amended, restated, amended and restated, supplemented, or otherwise modified from time to time, the "Pledge and Security Agreement"), among the Borrower, each of the Grantors party thereto, and the Collateral Agent. Capitalized terms used but not otherwise defined herein shall have the meanings assigned to such terms in the Credit Agreement.
C. Purpose of Mortgage.
Mortgagor is a Guarantor under the Guarantee Agreement and is the owner of certain real property and related interests more particularly described herein. To secure the prompt and complete payment and performance of the Secured Obligations (as defined in the Credit Agreement), Mortgagor has agreed to execute and deliver this Mortgage to Mortgagee, granting to Mortgagee a lien on and security interest in the Mortgaged Property (as defined herein). This Mortgage is being delivered pursuant to [Section []] of the Credit Agreement [or the Post-Closing Letter Agreement dated as of [__], as applicable] and constitutes a "Loan Document" as defined in the Credit Agreement.
D. Secured Obligations.
This Mortgage secures the "Secured Obligations" as defined in the Credit Agreement, which term encompasses all obligations of the Borrower and each Guarantor under or in respect of the Credit Agreement, the Guarantee Agreement, and each other Loan Document, including, without limitation, all principal, interest (including interest accruing after the filing of any petition in bankruptcy or the commencement of any insolvency, reorganization, or similar proceeding, whether or not a claim for post-filing or post-petition interest is allowed in such proceeding), premium (if any), fees, charges, expenses, reimbursement obligations, indemnification obligations, and all other amounts payable by the Borrower or any Guarantor under or in respect of any Loan Document, whether direct or indirect, absolute or contingent, due or to become due, now existing or hereafter arising.
NOW, THEREFORE, in consideration of the premises, the extensions of credit made and to be made under the Credit Agreement, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, Mortgagor agrees as follows:
ARTICLE I — DEFINITIONS AND RULES OF CONSTRUCTION
Section 1.01 — Defined Terms.
All capitalized terms used in this Mortgage and not otherwise defined herein shall have the meanings ascribed to such terms in the Credit Agreement. As used in this Mortgage, the following terms shall have the following meanings:
"Beneficiary" means [Insert full legal name of Collateral Agent], in its capacity as Collateral Agent for the benefit of the Secured Parties under the Credit Agreement. The term "Beneficiary" shall be used in lieu of "Mortgagee" when this instrument is used as a deed of trust.
"Collateral Agent" means [Insert full legal name of Collateral Agent], in its capacity as Collateral Agent under the Credit Agreement, and its successors and assigns in such capacity.
"Credit Agreement" has the meaning assigned to such term in the Recitals hereof.
"Default Rate" has the meaning assigned to such term in the Credit Agreement.
"Event of Default" has the meaning assigned to such term in the Credit Agreement.
"Fixtures" means all fixtures, equipment, machinery, building systems, and other items of property now or hereafter permanently affixed to, attached to, incorporated into, or used in connection with the Land, the Improvements, or the Mortgaged Property, including, without limitation, all heating, ventilation, and air conditioning systems and equipment ("HVAC"), elevators, escalators, fire suppression and fire alarm systems, sprinkler systems, telecommunications systems and equipment, electrical and plumbing systems, security systems, lighting fixtures, signage, generators, boilers, furnaces, water heaters, refrigeration equipment, laundry equipment, kitchen equipment, and all hotel furniture, fixtures, and equipment ("FF&E") to the extent constituting fixtures under applicable law.
"Grantor" means [Insert full legal name of subsidiary entity], in its capacity as the grantor of this instrument. The term "Grantor" is used interchangeably with "Mortgagor" and "Trustor" depending on the applicable jurisdiction.
"Guarantee Agreement" has the meaning assigned to such term in Recital B hereof.
"Impositions" means all real property taxes, personal property taxes, assessments (general and special), water and sewer rents, rates, and charges, vault charges, license fees, permit fees, inspection fees, utility charges, and all other governmental taxes, levies, charges, and assessments of every kind and nature whatsoever, whether general or special, ordinary or extraordinary, foreseen or unforeseen, which at any time may be assessed, levied, confirmed, imposed upon, become due and payable with respect to, or become a lien on the Mortgaged Property or any part thereof, or the sidewalks, curbs, vaults, or streets in front of or adjoining the Mortgaged Property, or any use or occupancy thereof, together with all interest and penalties thereon.
"Improvements" means all buildings, structures, and improvements of every kind and description now or hereafter erected, constructed, placed, or located on the Land, including, without limitation, all hotel buildings, parking structures and garages, conference facilities, restaurants, pools, recreational facilities, retail spaces, lobbies, common areas, and all other structures and improvements of any nature whatsoever.
"Land" means the real property described in Exhibit A attached hereto and incorporated herein by reference, together with all right, title, and interest of Mortgagor in and to any land lying within the right-of-way of any street, road, or avenue, open or proposed, in front of, behind, or adjoining such real property, to the center line thereof.
"Leases" means all leases, subleases, licenses, concessions, occupancy agreements, lettings, tenancies (whether written or oral), management agreements, franchise agreements, hotel operating agreements, and all other agreements now or hereafter in effect affecting the use, enjoyment, or occupancy of the Mortgaged Property or any portion thereof, together with all amendments, modifications, extensions, renewals, guarantees, and other agreements relating thereto, and all security deposits, advance rentals, and other deposits held thereunder.
"Loan Documents" has the meaning assigned to such term in the Credit Agreement.
"Mortgage" means this Mortgage, Deed of Trust, Assignment of Leases and Rents, and Security Agreement, as it may be amended, restated, amended and restated, supplemented, or otherwise modified from time to time.
"Mortgaged Property" means, collectively, all of the property, rights, interests, and estates described in the Granting Clauses set forth in Article II hereof, including, without limitation, the Land, the Improvements, the Fixtures, the Rents, the Leases, and all other property, whether real, personal, or mixed, tangible or intangible, now owned or hereafter acquired by Mortgagor and described in Article II.
"Mortgagee" means [Insert full legal name of Collateral Agent], in its capacity as Collateral Agent for the benefit of the Secured Parties under the Credit Agreement, and its successors and assigns in such capacity.
"Mortgagor" means [Insert full legal name of subsidiary entity], a [Insert entity type] organized and existing under the laws of the State of [Insert jurisdiction of organization], and its successors and permitted assigns.
"Permitted Encumbrances" means, collectively, (a) the lien of this Mortgage, (b) the exceptions to title listed on Exhibit B attached hereto and incorporated herein by reference, (c) Permitted Liens (as defined in the Credit Agreement), and (d) such other encumbrances as may be approved in writing by Mortgagee in its capacity as Collateral Agent.
"Pledge and Security Agreement" has the meaning assigned to such term in Recital B hereof.
"Rents" means all rents, revenues, royalties, income, profits, proceeds, and other benefits derived from or arising out of the Mortgaged Property, including, without limitation, all hotel room revenues, food and beverage revenues, conference and event revenues, spa and recreation revenues, parking revenues, retail revenues, vending machine revenues, telecommunications revenues, cancellation fees, minimum rents, additional rents, percentage rents, deficiency rents, liquidated damages following default under any Lease, premiums payable by any tenant upon the exercise of any cancellation or termination privilege, and all proceeds payable under any policy of insurance covering loss of rents or business interruption resulting from untenantability caused by damage to or destruction of the Mortgaged Property.
"Secured Obligations" has the meaning assigned to such term in the Credit Agreement.
"Secured Parties" has the meaning assigned to such term in the Credit Agreement.
"Trustee" means [Insert name of deed of trust trustee], and its successors and assigns. [Note: Applicable only in deed of trust states. Delete for mortgage states.]
"Trustor" means [Insert full legal name of subsidiary entity], in its capacity as the grantor of this instrument when used in deed of trust form. The term "Trustor" is used interchangeably with "Mortgagor" and "Grantor" depending on the applicable jurisdiction.
"UCC" means the Uniform Commercial Code as in effect from time to time in the State of [Insert applicable state].
Section 1.02 — Rules of Construction.
(a) The rules of construction and interpretation set forth in the Credit Agreement are hereby incorporated by reference as if set forth herein in their entirety and shall apply to this Mortgage, mutatis mutandis.
(b) The headings and captions of the various Articles, Sections, and subsections of this Mortgage and the Exhibits and Riders hereto are for convenience of reference only and are not to be construed as defining, limiting, or otherwise modifying the scope or intent of any provision hereof.
(c) As used herein, (i) the singular includes the plural and vice versa, (ii) the masculine, feminine, and neuter genders each include the others, (iii) "including" means "including, without limitation," (iv) "or" is not exclusive, (v) references to "herein," "hereof," "hereunder," and similar words refer to this Mortgage as a whole and not to any particular Article, Section, or other subdivision, and (vi) references to Sections, Articles, Exhibits, and Riders refer to Sections and Articles of, and Exhibits and Riders to, this Mortgage unless otherwise specified.
(d) References to any law, statute, regulation, or rule include all statutory and regulatory provisions consolidating, amending, replacing, or interpreting such law, statute, regulation, or rule, and references to any law, statute, regulation, or rule shall be construed to also refer to all rules and regulations promulgated thereunder, unless the context otherwise requires.
(e) In the event of any conflict or inconsistency between the terms and provisions of this Mortgage and the terms and provisions of the Credit Agreement, the terms and provisions of the Credit Agreement shall govern and control; provided, however, that with respect to the creation, attachment, perfection, priority, and enforcement of the lien and security interest created by this Mortgage on the Mortgaged Property, the terms and provisions of this Mortgage (together with any applicable state-specific Rider) shall govern and control to the extent that such terms and provisions are more specific or more protective of Mortgagee's interest in the Mortgaged Property.
(f) For purposes of this Mortgage, the terms "Mortgagor," "Grantor," and "Trustor" are used interchangeably to refer to the entity granting this instrument, and the terms "Mortgagee" and "Beneficiary" are used interchangeably to refer to the Collateral Agent as the holder of the lien and security interest created hereby. The applicable designation shall be selected based on the jurisdiction in which the Mortgaged Property is located and the form of instrument customary in such jurisdiction.
ARTICLE II — GRANTING CLAUSES
Section 2.01 — Grant of Mortgage / Deed of Trust.
[Select applicable granting language based on jurisdiction:]
[For Mortgage States:]
In order to secure the payment and performance of the Secured Obligations, Mortgagor hereby irrevocably and unconditionally MORTGAGES, GRANTS, BARGAINS, SELLS, CONVEYS, ASSIGNS, TRANSFERS, PLEDGES, SETS OVER, AND HYPOTHECATES to Mortgagee, and grants to Mortgagee a first-priority lien on and security interest in, all of Mortgagor's right, title, and interest in, to, and under the following described property, rights, interests, and estates (collectively, the "Mortgaged Property"):
[For Deed of Trust States:]
In order to secure the payment and performance of the Secured Obligations, Trustor hereby irrevocably and unconditionally GRANTS, TRANSFERS, CONVEYS, AND ASSIGNS to Trustee, IN TRUST, WITH POWER OF SALE, for the benefit of Beneficiary, and grants to Beneficiary a first-priority lien on and security interest in, all of Trustor's right, title, and interest in, to, and under the following described property, rights, interests, and estates (collectively, the "Mortgaged Property"):
[Instruction: Select the appropriate granting clause based on jurisdiction. Delete the inapplicable alternative. In states that recognize both forms (e.g., certain states where either a mortgage or deed of trust may be used), select the form customary for the jurisdiction.]
Section 2.02 — Description of Mortgaged Property.
The Mortgaged Property consists of the following:
(a) Land. All that certain lot, piece, or parcel of land situated in [Insert county], [Insert state], more particularly described in Exhibit A attached hereto and incorporated herein by reference (the "Land"), together with all right, title, and interest of Mortgagor in and to (i) any land lying within the right-of-way of any street, road, highway, or avenue, whether open or proposed, in front of, behind, or adjoining the Land, to the center line thereof, (ii) any strips and gores of land adjacent to or used in connection with the Land, and (iii) any and all after-acquired title to the Land.
(b) Improvements. All buildings, structures, and improvements of every kind and description now or hereafter erected, constructed, placed, or located on the Land (collectively, the "Improvements"), including, without limitation, all hotel buildings, parking structures and garages, conference and meeting facilities, restaurants, bars, lounges, spas, fitness centers, swimming pools, recreational facilities, retail spaces, lobbies, common areas, covered walkways, landscaping, paving, curbing, fencing, walls, driveways, sidewalks, and all other structures and improvements of any nature whatsoever, together with all additions to, replacements of, and substitutions for any of the foregoing.
(c) Fixtures. All fixtures, equipment, machinery, building systems, and other items of property now or hereafter permanently affixed to, attached to, incorporated into, or used in connection with the Land, the Improvements, or any other portion of the Mortgaged Property (collectively, the "Fixtures"), including, without limitation, all HVAC systems and equipment, elevators, escalators, fire suppression and fire alarm systems, sprinkler systems, telecommunications systems and equipment, electrical systems, plumbing systems, security and surveillance systems, lighting fixtures, signage (interior and exterior), generators, boilers, furnaces, water heaters, water treatment systems, refrigeration equipment, laundry equipment, kitchen and food service equipment, and all hotel furniture, fixtures, and equipment (FF&E) to the extent constituting fixtures under applicable law, together with all additions to, replacements of, and substitutions for any of the foregoing, and all proceeds thereof.
(d) Easements and Appurtenances. All easements, rights-of-way, strips and gores of land, streets, alleys, passages, sewer rights, water rights, riparian rights, mineral rights, air rights, development rights, transferable development rights, and all other rights, privileges, benefits, tenements, hereditaments, and appurtenances now or hereafter belonging or in any way appertaining to the Land or the Improvements, or any part thereof, including, without limitation, all rights of ingress and egress to and from the Land, all rights to the nonexclusive use of common areas, and all rights under any reciprocal easement agreement, declaration of covenants, conditions and restrictions, or similar instrument affecting the Land.
(e) Leases and Rents. All right, title, and interest of Mortgagor in, to, and under all Leases and all Rents now or hereafter arising from or payable with respect to the Mortgaged Property (subject to the conditional, revocable license granted to Mortgagor in Article V hereof), including, without limitation, all guarantees of, security deposits under, and other collateral for, such Leases, and all rights and claims of any kind that Mortgagor may have against any tenant, subtenant, licensee, concessionaire, or occupant of the Mortgaged Property or any part thereof.
(f) Accounts and Revenues. All accounts, revenues, income, and other sums derived from the operation of the Mortgaged Property, including, without limitation, all hotel room revenues, food and beverage revenues, conference and event revenues, spa and recreation revenues, parking revenues, retail revenues, vending revenues, telecommunications revenues, resort fees, service charges, cancellation fees, attrition fees, group booking deposits, and all other hospitality-related income and receivables, whether now existing or hereafter arising.
(g) Permits and Licenses. All permits, licenses, approvals, certificates, authorizations, variances, entitlements, accreditations, ratings, and franchises now or hereafter relating to the ownership, construction, use, occupancy, or operation of the Mortgaged Property or any part thereof, including, without limitation, all hotel operating permits, certificates of occupancy, building permits, zoning approvals, liquor licenses, health permits, food service permits, elevator permits, sign permits, and environmental permits, in each case to the extent transferable or assignable under applicable law.
(h) Insurance and Condemnation Proceeds. All proceeds of any and all insurance policies now or hereafter covering the Mortgaged Property or any part thereof (regardless of whether such coverage is required hereunder), including, without limitation, all proceeds of fire, windstorm, flood, earthquake, terrorism, casualty, liability, business interruption, and rental loss insurance, and all condemnation awards, judgments, settlements, and other proceeds and compensation now or hereafter made or payable with respect to the Mortgaged Property or any part thereof in connection with any condemnation, eminent domain, or similar proceeding, whether direct or indirect, and any awards and settlements in lieu thereof.
(i) Personal Property. All tangible and intangible personal property now or hereafter owned by Mortgagor and located on, used in connection with, or arising from the operation of the Mortgaged Property (to the extent not covered by a separate Pledge and Security Agreement or other security agreement delivered in connection with the Credit Agreement), including, without limitation, all furniture, furnishings, equipment, inventory, goods, supplies, linens, china, glassware, silverware, artwork, decorative items, lobby furnishings, guest room furnishings, office equipment, computer hardware and software, vehicles and carts, tools, cleaning equipment, maintenance equipment, and all other personal property of every kind and nature.
(j) Proceeds. All proceeds (as defined in the UCC) of the conversion, voluntary or involuntary, of any of the foregoing into cash or other liquidated claims, including, without limitation, all proceeds of any sale, lease, license, exchange, collection, or other disposition of any of the foregoing, all claims and causes of action against third parties for loss of, damage to, or destruction of any of the foregoing, and all title insurance and other insurance proceeds.
(k) After-Acquired Property. All property of any of the foregoing types hereafter acquired by Mortgagor, including, without limitation, all property acquired as a replacement for, addition to, or substitution of any of the foregoing, and all proceeds thereof.
Section 2.03 — Habendum.
TO HAVE AND TO HOLD the Mortgaged Property unto Mortgagee (or in the case of a deed of trust, unto Trustee for the benefit of Beneficiary), and Mortgagee's (or Trustee's and Beneficiary's) successors and assigns, forever, subject to the terms and conditions of this Mortgage, for the uses and purposes herein set forth; provided, however, that if the Secured Obligations shall be indefeasibly paid and performed in full and all commitments under the Credit Agreement shall have been terminated, then this Mortgage and the estate hereby created shall cease, terminate, and become void, and Mortgagee shall execute and deliver to Mortgagor such instruments of release, satisfaction, reconveyance, or discharge as may be necessary to evidence the release of the lien created hereby, as more fully set forth in Section 10.11 hereof.
Section 2.04 — Security Agreement.
(a) This Mortgage shall be construed as, and shall constitute, a security agreement within the meaning of Article 9 of the UCC with respect to any portion of the Mortgaged Property that constitutes personal property or fixtures (whether tangible or intangible). Without limiting the generality of the foregoing, Mortgagor hereby grants to Mortgagee a continuing first-priority security interest in all of Mortgagor's right, title, and interest in, to, and under all personal property and fixtures included within the Mortgaged Property, as security for the payment and performance of the Secured Obligations.
(b) Mortgagor hereby authorizes Mortgagee to file one or more UCC financing statements (including fixture filings) and continuation statements in such form and in such offices as Mortgagee may determine to be necessary or appropriate to perfect the security interest granted herein. Mortgagor agrees that a carbon, photographic, or other reproduction of this Mortgage or of any UCC financing statement shall be sufficient as a financing statement. Mortgagor shall pay all filing and recording fees and all costs and expenses incurred in connection with the filing and recording of such financing statements and continuation statements.
(c) Upon the occurrence and during the continuance of an Event of Default, Mortgagee shall have, in addition to all other rights and remedies provided herein or in any other Loan Document, all of the rights and remedies of a secured party under Article 9 of the UCC, including, without limitation, the right to take possession of the personal property and fixtures constituting part of the Mortgaged Property and to dispose of such property in accordance with the UCC. The filing of a UCC financing statement in the records normally having to do with personal property or fixtures shall not be construed as in any way impairing the right of Mortgagee to proceed against any personal property or fixtures as part of the real property encumbered by this Mortgage in accordance with the provisions hereof.
(d) Mortgagor represents and warrants that the information set forth in the fixture filing addendum attached hereto as Exhibit C (if applicable) is true and correct as of the date hereof. Mortgagor agrees to furnish to Mortgagee any information that Mortgagee may from time to time reasonably request in order to enable Mortgagee to file any required financing statements or continuation statements.
ARTICLE III — SECURED OBLIGATIONS
Section 3.01 — Obligations Secured.
This Mortgage and the lien and security interest created hereby secure the full and punctual payment and performance of each and all of the following (collectively, the "Obligations Secured"):
(a) All obligations of Mortgagor under the Guarantee Agreement, including, without limitation, Mortgagor's guaranty of the obligations of the Borrower under the Credit Agreement and the other Loan Documents;
(b) All obligations of the Borrower and each Guarantor (including Mortgagor) under or in respect of the Credit Agreement and each other Loan Document, including, without limitation, all obligations in respect of principal, interest, premium (if any), fees, charges, expenses, indemnities, reimbursement obligations, and all other amounts payable under or in respect of any Loan Document;
(c) All Secured Obligations as defined in the Credit Agreement, whether now existing or hereafter arising, whether direct or indirect, absolute or contingent, due or to become due, including, without limitation, all interest, fees, and expenses that accrue after the commencement of any proceeding under any Debtor Relief Laws (as defined in the Credit Agreement) naming the Borrower, any Guarantor, or Mortgagor as the debtor in such proceeding, regardless of whether such interest, fees, and expenses are allowed claims in such proceeding;
(d) All costs and expenses incurred by Mortgagee or any other Secured Party in enforcing or protecting its rights under this Mortgage or any other Loan Document, including, without limitation, all attorneys' fees and disbursements, court costs, receiver fees, appraisal costs, title search and examination costs, environmental assessment and monitoring costs, and all other costs and expenses of enforcement and collection; and
(e) All modifications, extensions, renewals, refinancings, replacements, rearrangements, and substitutions of any of the foregoing, including any increase in the principal amount of the Secured Obligations resulting from incremental term loans, additional extensions of credit, or protective advances made pursuant to the Credit Agreement.
Section 3.02 — Future Advances.
(a) This Mortgage secures, in addition to the obligations described in Section 3.01, all future advances and other future obligations made or incurred by Mortgagee or any other Secured Party under the Credit Agreement, whether such future advances or obligations are obligatory or are made or incurred at the option of Mortgagee, the Administrative Agent, or any Lender, including, without limitation, any incremental term loans, revolving credit advances, protective advances, or other extensions of credit made under or in connection with the Credit Agreement, together with all interest thereon and all costs and expenses of collection thereof.
(b) To the extent required by the laws of the State of [Insert applicable state], the maximum principal amount secured by this Mortgage at any one time, including all future advances, shall not exceed $[__] (the "Maximum Secured Amount"). The foregoing limitation on the maximum principal amount secured shall not limit the amount of interest, fees, costs, expenses, and other charges secured hereby, which shall be secured in addition to the Maximum Secured Amount to the fullest extent permitted by applicable law. If the laws of the jurisdiction in which the Mortgaged Property is located do not require a stated maximum amount, the Maximum Secured Amount designation may be disregarded and this Mortgage shall secure the Secured Obligations in their entirety without dollar limitation.
(c) This Mortgage shall remain a valid and binding lien on and security interest in the Mortgaged Property regardless of (i) the amount outstanding under the Credit Agreement at any time, (ii) any repayment and reborrowing of amounts under the Credit Agreement, or (iii) any release of other collateral securing the Secured Obligations.
(d) To the extent that the jurisdiction in which the Mortgaged Property is located requires particular language for the securing of future advances, the applicable state-specific Rider attached hereto shall supplement and, where inconsistent, supersede the provisions of this Section 3.02.
ARTICLE IV — REPRESENTATIONS, WARRANTIES, AND COVENANTS OF MORTGAGOR
Section 4.01 — Title and Lien Priority.
Mortgagor hereby represents and warrants that:
(a) Mortgagor holds good, valid, and marketable fee simple title to the Land and the Improvements (or, if indicated in the Recitals, a valid leasehold interest therein), free and clear of all liens, charges, encumbrances, security interests, restrictions, conditions, options, rights of first refusal, and other adverse claims or interests of any kind whatsoever, except for the Permitted Encumbrances;
(b) This Mortgage creates a valid, enforceable, and perfected first-priority lien on and security interest in the Mortgaged Property, subject only to the Permitted Encumbrances;
(c) Mortgagor has not executed, and will not execute, any other mortgage, deed of trust, assignment, conveyance, or act of sale covering the Mortgaged Property or any part thereof, other than as permitted under the Credit Agreement; and
(d) No person other than Mortgagor has any ownership interest in the Mortgaged Property, except as disclosed in the Permitted Encumbrances.
Section 4.02 — Authority.
Mortgagor hereby represents and warrants that:
(a) Mortgagor is duly organized, validly existing, and in good standing under the laws of the jurisdiction of its organization and is qualified to do business and in good standing in the State of [Insert state in which the Mortgaged Property is located];
(b) Mortgagor has full power, authority, and legal right to execute and deliver this Mortgage, to grant the liens and security interests herein, and to perform its obligations hereunder;
(c) The execution and delivery of this Mortgage and the performance of Mortgagor's obligations hereunder have been duly authorized by all necessary corporate, partnership, limited liability company, or other organizational action, and no further consent, approval, authorization, or order of, or filing or registration with, any governmental authority or any other person is required in connection therewith, except such filings as may be required to perfect the liens created hereby; and
(d) This Mortgage has been duly executed and delivered by Mortgagor and constitutes the legal, valid, and binding obligation of Mortgagor, enforceable against Mortgagor in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium, and similar laws affecting creditors' rights generally and to general principles of equity.
Section 4.03 — No Conflicts.
Mortgagor hereby represents and warrants that the execution, delivery, and performance of this Mortgage by Mortgagor do not and will not (a) violate any provision of Mortgagor's certificate of incorporation, bylaws, certificate of formation, operating agreement, partnership agreement, or other organizational documents, (b) violate any applicable law, rule, regulation, order, judgment, writ, injunction, or decree of any court or governmental authority, (c) result in a breach of or constitute a default under any material indenture, mortgage, deed of trust, loan agreement, or other material agreement or instrument to which Mortgagor is a party or by which Mortgagor or any of its assets may be bound, or (d) result in the creation or imposition of any lien upon the Mortgaged Property other than the liens created hereby and the Permitted Encumbrances.
Section 4.04 — Payment of Secured Obligations.
Mortgagor covenants and agrees to duly and punctually pay and perform all Secured Obligations in accordance with the terms and conditions of the Credit Agreement and the other Loan Documents. In the event of any failure by the Borrower to pay or perform any of the Secured Obligations when due, Mortgagor shall pay and perform such Secured Obligations in accordance with the Guarantee Agreement.
Section 4.05 — Maintenance and Repair.
(a) Mortgagor covenants and agrees to maintain, preserve, and keep the Mortgaged Property, including all Improvements, Fixtures, and personal property, in good condition, working order, and repair, consistent with the standards customarily maintained by prudent owners and operators of comparable hospitality properties in the same geographic market as the Mortgaged Property (taking into account the age, type, class, and use of such property).
(b) Mortgagor shall promptly make or cause to be made all necessary and appropriate repairs, renewals, replacements, additions, and improvements to the Mortgaged Property, whether structural or non-structural, ordinary or extraordinary, foreseen or unforeseen, to the extent necessary to maintain the Mortgaged Property in the condition required by this Section 4.05.
(c) Mortgagor shall not commit or suffer any waste (whether voluntary, involuntary, permissive, or ameliorating) with respect to the Mortgaged Property. Without limiting the generality of the foregoing, Mortgagor shall not, without the prior written consent of Mortgagee (except as may be permitted under the Credit Agreement), (i) remove, demolish, or substantially alter any of the Improvements, (ii) cut any standing timber on the Land, (iii) strip, exhaust, or impair any resource of the Land, or (iv) take any action that would impair the value of the Mortgaged Property or the lien of this Mortgage.
(d) Mortgagor shall comply with all franchise agreements, management agreements, and brand standards applicable to the Mortgaged Property and shall maintain the Mortgaged Property in compliance with all requirements necessary to maintain any applicable hotel brand affiliation, star rating, or similar quality designation.
Section 4.06 — Insurance.
(a) Mortgagor covenants and agrees to maintain, or cause to be maintained, at Mortgagor's sole cost and expense, insurance coverages with respect to the Mortgaged Property in such types, amounts, and with such insurers as are required under the Credit Agreement, including, without limitation:
(i) Property/Casualty Insurance. All-risk property insurance (including coverage for fire, windstorm, hail, explosion, smoke, riot, civil commotion, vandalism, malicious mischief, and such other risks as are customarily covered under all-risk property insurance policies for comparable hospitality properties) covering the full replacement cost of the Improvements, Fixtures, and personal property constituting part of the Mortgaged Property, without deduction for depreciation and without coinsurance penalty, with deductibles not exceeding the amounts specified in the Credit Agreement;
(ii) Commercial General Liability Insurance. Commercial general liability insurance covering claims for bodily injury (including death) and property damage occurring on, in, or about the Mortgaged Property, with coverage limits not less than those specified in the Credit Agreement;
(iii) Business Interruption Insurance. Business interruption and/or rental loss insurance in an amount sufficient to cover not less than twelve (12) months of projected gross revenues from the Mortgaged Property (or such other period as may be required under the Credit Agreement);
(iv) Flood Insurance. If any portion of the Mortgaged Property is located in a Special Flood Hazard Area as designated by the Federal Emergency Management Agency ("FEMA"), flood insurance in the maximum amount available under the National Flood Insurance Program, or such greater amount as may be required under the Credit Agreement;
(v) Builder's Risk Insurance. During any period of construction, renovation, or restoration of the Improvements, builder's risk insurance on an all-risk, completed value, non-reporting basis, in an amount not less than the full replacement cost of the Improvements upon completion of such construction, renovation, or restoration; and
(vi) Other Insurance. Such other insurance as may be required under the Credit Agreement, including, without limitation, terrorism insurance, earthquake insurance (if the Mortgaged Property is located in a seismically active area), umbrella/excess liability insurance, workers' compensation insurance, automobile liability insurance, and liquor liability insurance, in each case in such amounts and with such terms as required under the Credit Agreement.
(b) All insurance policies required hereunder shall (i) name Mortgagee, in its capacity as Collateral Agent for the benefit of the Secured Parties, as an additional insured and/or mortgagee loss payee, as applicable (utilizing a standard mortgagee clause or equivalent endorsement acceptable to Mortgagee), (ii) provide that such policies shall not be canceled, materially modified, or not renewed without at least thirty (30) days' prior written notice to Mortgagee (or ten (10) days' in the case of cancellation for nonpayment of premium), and (iii) contain such other provisions and endorsements as Mortgagee may reasonably require.
(c) Mortgagor shall deliver to Mortgagee certificates of insurance and, upon request, certified copies of all insurance policies required hereunder, together with evidence of payment of premiums, within the time periods and in the manner specified in the Credit Agreement. Mortgagor shall deliver to Mortgagee evidence of the renewal or replacement of each such policy not less than fifteen (15) days prior to the expiration thereof.
(d) If Mortgagor fails to maintain the insurance required hereunder, Mortgagee may (but shall not be obligated to) obtain such insurance and pay the premiums therefor, and all amounts so paid by Mortgagee shall be added to the Secured Obligations, shall bear interest at the Default Rate from the date of payment, and shall be secured by this Mortgage.
Section 4.07 — Payment of Impositions.
(a) Mortgagor covenants and agrees to pay, or cause to be paid, all Impositions now or hereafter levied, assessed, or imposed upon the Mortgaged Property or any part thereof, or upon the revenues, rents, issues, income, and profits thereof, before the same become delinquent or any penalty or interest attaches thereto. Mortgagor shall deliver to Mortgagee, promptly upon Mortgagee's request, evidence satisfactory to Mortgagee of the payment of each such Imposition.
(b) Notwithstanding the foregoing, Mortgagor shall not be required to pay any Imposition so long as Mortgagor shall in good faith contest the amount, validity, or applicability thereof by appropriate legal proceedings that effectively prevent the collection of such Imposition and the sale, forfeiture, or loss of the Mortgaged Property or any part thereof, provided that (i) such contest is permitted under the Credit Agreement, (ii) Mortgagor has established adequate reserves therefor in accordance with GAAP and the Credit Agreement, (iii) during the pendency of such contest, the enforcement of any lien relating to such contested Imposition is effectively stayed, and (iv) Mortgagor promptly pays all amounts determined to be due upon the final resolution of such contest, together with all penalties and interest thereon.
Section 4.08 — Compliance with Laws.
Mortgagor covenants and agrees to comply, and cause the Mortgaged Property to comply, with all applicable federal, state, and local laws, statutes, regulations, ordinances, rules, codes, orders, judgments, writs, injunctions, and decrees, including, without limitation, (a) all zoning and land use laws and regulations, (b) all Environmental Laws (as defined in the Credit Agreement), (c) the Americans with Disabilities Act of 1990 ("ADA") and all regulations promulgated thereunder, (d) all building, fire, health, and safety codes and regulations, (e) all laws relating to the operation of hotel and hospitality properties, including applicable food safety, sanitation, and liquor licensing requirements, and (f) all other laws, regulations, and ordinances applicable to the ownership, use, occupancy, or operation of the Mortgaged Property or any part thereof. Mortgagor shall promptly furnish to Mortgagee copies of any notices of violation received from any governmental authority with respect to any of the foregoing.
Section 4.09 — Environmental Covenants.
(a) Mortgagor covenants and agrees that Mortgagor shall not, and shall not permit any tenant, subtenant, licensee, occupant, contractor, or other person to, use, generate, manufacture, treat, store, handle, release, transport, or dispose of any Hazardous Materials (as defined in the Credit Agreement) on, under, in, or about the Mortgaged Property or transport any Hazardous Materials to or from the Mortgaged Property, except in compliance with all applicable Environmental Laws and in quantities and in a manner customary for the operation of a comparable hospitality property (including cleaning supplies, swimming pool chemicals, maintenance supplies, pest control substances, and similar materials used in the ordinary course of hotel operations in compliance with Environmental Laws).
(b) Mortgagor shall promptly notify Mortgagee in writing of (i) any release or threatened release of Hazardous Materials on, under, or from the Mortgaged Property, (ii) any Environmental Claim (as defined in the Credit Agreement) received by Mortgagor relating to the Mortgaged Property, and (iii) any condition on the Mortgaged Property that could reasonably be expected to result in a violation of any Environmental Law or give rise to any Environmental Claim.
(c) Mortgagor shall, at its sole cost and expense, promptly investigate, remediate, and clean up any contamination of the Mortgaged Property by Hazardous Materials in accordance with applicable Environmental Laws and to the satisfaction of all applicable governmental authorities, and shall take all actions necessary to restore the Mortgaged Property to a condition that complies with all applicable Environmental Laws.
(d) Mortgagor shall indemnify, defend, and hold harmless Mortgagee, the Administrative Agent, each Lender, and each other Secured Party and their respective directors, officers, employees, agents, successors, and assigns from and against any and all claims, demands, liabilities, losses, damages, penalties, fines, costs, and expenses (including attorneys' fees and disbursements, expert witness fees, and remediation costs) arising out of or in any way relating to (i) any Hazardous Materials on, under, in, or migrating from the Mortgaged Property, (ii) any violation of any Environmental Law with respect to the Mortgaged Property, or (iii) any Environmental Claim relating to the Mortgaged Property, in each case regardless of whether such matters existed prior to or arise after the date of this Mortgage, except to the extent that such claims, liabilities, or losses result from the gross negligence or willful misconduct of the indemnified party. The obligations of Mortgagor under this Section 4.09(d) shall survive the repayment of the Secured Obligations, the release of this Mortgage, and any foreclosure of this Mortgage or transfer in lieu thereof.
Section 4.10 — Leases.
(a) Mortgagor covenants and agrees that Mortgagor shall not, without the prior written consent of Mortgagee (except as permitted under the Credit Agreement), (i) enter into any new Lease affecting the Mortgaged Property or any material portion thereof, (ii) materially amend, modify, extend, renew, or supplement any existing Lease, (iii) terminate, cancel, or accept the surrender of any existing Lease (except upon the expiration of the stated term thereof), (iv) consent to any assignment or subletting under any Lease, or (v) waive or release any material right or claim of Mortgagor under any Lease.
(b) Mortgagor shall duly and punctually perform and comply with all of Mortgagor's obligations as landlord, licensor, or grantor under each Lease, and shall enforce or secure the performance by each tenant, licensee, or occupant of all of the obligations of such tenant, licensee, or occupant under its respective Lease.
(c) Mortgagor represents and warrants that, as of the date hereof, (i) each Lease listed on Schedule [__] hereto (if any) is in full force and effect, (ii) no default by Mortgagor or, to Mortgagor's knowledge, by any tenant exists under any such Lease, (iii) all rents and other sums due and payable under such Leases have been collected in the ordinary course and not more than one (1) month in advance, and (iv) no tenant under any such Lease has asserted any claim, defense, setoff, or counterclaim against Mortgagor.
(d) Mortgagor shall deliver to Mortgagee, promptly upon Mortgagee's request, a true, correct, and complete copy of each Lease affecting the Mortgaged Property and such other information with respect to the Leases as Mortgagee may reasonably request.
Section 4.11 — Alterations and Improvements.
(a) Mortgagor covenants and agrees that Mortgagor shall not, without the prior written consent of Mortgagee (except as permitted under the Credit Agreement), (i) remove or demolish, or permit the removal or demolition of, any Improvement or Fixture constituting a part of the Mortgaged Property, (ii) make or permit any structural alteration to the Improvements, or (iii) make or permit any material non-structural alteration to the Improvements.
(b) Notwithstanding the foregoing, Mortgagor may, without Mortgagee's prior consent, (i) make non-structural alterations, renovations, and improvements in the ordinary course of Mortgagor's hospitality business that do not exceed the Permitted Expenditures threshold set forth in the Credit Agreement (or that are otherwise expressly permitted under the Credit Agreement), provided that such alterations do not materially and adversely affect the value or utility of the Mortgaged Property, and (ii) remove and replace Fixtures and personal property in the ordinary course of business, provided that any replacement items are of comparable or better quality and utility and are free and clear of all liens other than Permitted Encumbrances and the lien of this Mortgage.
(c) All alterations, renovations, improvements, and repairs to the Mortgaged Property shall be performed in a good and workmanlike manner, in compliance with all applicable laws, codes, and regulations, and in compliance with the requirements of any applicable franchise agreement, management agreement, or brand standard. Mortgagor shall not permit any mechanics' liens, materialmen's liens, or other liens to be filed or to remain undischarged against the Mortgaged Property as a result of any work performed thereon, except as contested in good faith in accordance with the terms of the Credit Agreement.
Section 4.12 — Further Assurances.
Mortgagor covenants and agrees, at Mortgagor's sole cost and expense, to execute, acknowledge, and deliver, or cause to be executed, acknowledged, and delivered, all such further acts, deeds, conveyances, mortgages, assignments, notices of assignment, transfers, assurances, and other instruments as Mortgagee may from time to time reasonably request in order to (a) better assure, convey, grant, assign, transfer, and confirm unto Mortgagee the rights, interests, and properties intended to be granted, assigned, transferred, and conveyed by this Mortgage, (b) perfect and protect the first-priority lien and security interest of this Mortgage, (c) carry out more effectively the purposes and intent of this Mortgage and the other Loan Documents, and (d) more fully identify and subject to the lien and security interest of this Mortgage any property covered or intended to be covered hereby (including any renewals, additions, substitutions, replacements, or appurtenances thereto). Mortgagor shall pay all filing and recording fees, taxes, and expenses incurred in connection with such further assurances.
Section 4.13 — Books and Records / Inspection.
(a) Mortgagor covenants and agrees to maintain complete and accurate books and records relating to the ownership, operation, maintenance, management, leasing, and financial condition of the Mortgaged Property, in a manner consistent with sound accounting practices and in compliance with the requirements of the Credit Agreement.
(b) Mortgagor shall furnish to Mortgagee, promptly upon request, such financial statements, operating statements, rent rolls, occupancy reports, revenue per available room ("RevPAR") data, average daily rate ("ADR") data, and other reports and information relating to the Mortgaged Property as Mortgagee may reasonably request, to the extent such information is required to be delivered under the Credit Agreement.
(c) Mortgagor shall permit Mortgagee and its agents, representatives, consultants, and contractors to enter upon and inspect the Mortgaged Property at reasonable times during normal business hours, and to examine and copy all books and records relating to the Mortgaged Property, in each case subject to the terms and conditions of the Credit Agreement governing inspection rights. Mortgagee shall use commercially reasonable efforts to minimize interference with the operation of the Mortgaged Property during any such inspection.
Section 4.14 — Transfer Restrictions.
Mortgagor covenants and agrees that Mortgagor shall not, without the prior written consent of Mortgagee, directly or indirectly sell, transfer, convey, assign, exchange, lease (other than in the ordinary course of business as permitted hereunder and under the Credit Agreement), encumber, pledge, hypothecate, grant a security interest in, grant an option with respect to, or otherwise dispose of (whether voluntarily, involuntarily, by operation of law, or otherwise) all or any part of, or any legal or beneficial interest in, the Mortgaged Property or any part thereof, except as expressly permitted under the Credit Agreement (including, without limitation, dispositions permitted under the Credit Agreement). Any transfer or encumbrance in violation of this Section 4.14 shall constitute an Event of Default.
ARTICLE V — ASSIGNMENT OF LEASES AND RENTS
Section 5.01 — Assignment.
(a) As additional security for the payment and performance of the Secured Obligations, Mortgagor hereby absolutely, presently, and unconditionally assigns, transfers, conveys, and sets over to Mortgagee all of Mortgagor's right, title, and interest in, to, and under (i) all Leases now existing or hereafter entered into with respect to the Mortgaged Property or any part thereof, together with all guarantees thereof, all amendments, modifications, extensions, renewals, and other agreements relating thereto, and all security deposits and advance rentals held thereunder, and (ii) all Rents now due or hereafter to become due under or by virtue of any Lease or from the use, enjoyment, or occupancy of the Mortgaged Property or any part thereof.
(b) The assignment contained in this Article V is a present, absolute, and unconditional assignment, and not merely an assignment for additional security. Mortgagor acknowledges and agrees that the assignment of Leases and Rents hereunder is intended to be absolute and not merely as additional collateral security, subject only to the revocable license granted to Mortgagor in Section 5.02 below. The foregoing assignment shall not be construed to impose upon Mortgagee any obligation with respect to any Lease or to require Mortgagee to take any action to collect any Rent or to enforce any obligation of any tenant or occupant of the Mortgaged Property.
(c) This assignment shall be effective as of the date hereof and shall continue in full force and effect until all Secured Obligations have been indefeasibly paid in full and all commitments under the Credit Agreement have been terminated. This assignment is made in addition to, and not in substitution for, any other assignment of leases and rents that may now or hereafter be held by Mortgagee as security for the Secured Obligations.
Section 5.02 — Revocable License.
(a) Notwithstanding the absolute assignment contained in Section 5.01, Mortgagee hereby grants to Mortgagor a revocable license to collect, receive, use, and enjoy the Rents and to enforce the terms of the Leases, so long as no Event of Default shall have occurred and be continuing.
(b) The license granted to Mortgagor under this Section 5.02 shall be automatically and immediately revoked, without any further action by Mortgagee and without notice to Mortgagor (to the extent permitted by applicable law), upon the occurrence and during the continuance of an Event of Default.
(c) Upon the revocation of the license granted hereunder (whether automatically or by notice from Mortgagee), (i) Mortgagor shall immediately deliver to Mortgagee all Rents then held by Mortgagor, (ii) all Rents thereafter collected by Mortgagor shall be held in trust for the benefit of Mortgagee and shall be immediately delivered to Mortgagee, and (iii) Mortgagor shall not exercise any right or remedy under any Lease or take any action with respect to the Rents without the prior written consent of Mortgagee.
Section 5.03 — Mortgagee's Rights Upon Default.
Upon the occurrence and during the continuance of an Event of Default, Mortgagee shall have the right (but not the obligation), in addition to any other rights and remedies available to Mortgagee hereunder or under any other Loan Document, to:
(a) Enter upon and take possession of the Mortgaged Property, or any part thereof, and manage and operate the same, either directly or through an agent or receiver, including continued operation of the Mortgaged Property as a hotel or hospitality facility;
(b) Collect the Rents directly from tenants, guests, hotel management companies, online travel agencies, group booking agents, and any other persons obligated to pay Rents or other amounts with respect to the Mortgaged Property, and to give receipts therefor;
(c) Apply the Rents so collected to the payment of the Secured Obligations in such order and manner as Mortgagee may determine, after deduction of all costs and expenses of collection and management (including, without limitation, attorneys' fees, management fees, and costs of repair and maintenance);
(d) Apply for and obtain the appointment of a receiver of the Rents and the Mortgaged Property, as more fully described in Section 7.03 hereof; and
(e) Exercise any and all other rights and remedies available to Mortgagee under this Mortgage, the Credit Agreement, the other Loan Documents, or applicable law.
Section 5.04 — Tenant Notification.
(a) Upon the occurrence and during the continuance of an Event of Default, Mortgagee shall have the right, but not the obligation, to send written notice to any or all tenants, subtenants, licensees, concessionaires, hotel management companies, operators, and other persons obligated to pay Rents or other amounts with respect to the Mortgaged Property, directing such persons to make payment of all Rents and other amounts due or to become due directly to Mortgagee or to such other person or account as Mortgagee may designate.
(b) Mortgagor hereby irrevocably authorizes and directs each such tenant, subtenant, licensee, concessionaire, hotel management company, operator, or other person to comply with any such direction from Mortgagee without any obligation to determine whether an Event of Default has actually occurred or is continuing. Each such person shall be entitled to rely upon any notice from Mortgagee and shall have no liability to Mortgagor for any payments made to Mortgagee in accordance with such notice.
(c) Mortgagor agrees that any such notice from Mortgagee shall be a complete defense to any claim by Mortgagor against any such tenant, subtenant, licensee, concessionaire, hotel management company, operator, or other person for Rents paid to Mortgagee in accordance with such notice.
ARTICLE VI — CASUALTY AND CONDEMNATION
Section 6.01 — Casualty / Insurance Proceeds.
(a) Notice of Casualty. Mortgagor shall give prompt written notice to Mortgagee of any damage to or destruction of any material portion of the Mortgaged Property, whether or not covered by insurance. Such