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HomeMy WebLinkAbout96-05191 .... .. \. ~ III ( ~ ~ t' , \.. t ~ "'" '" :t ~ ~. " t \. 11 ~ ..... 'c\ . ~I . I .1~.uXJJ:l.cI.(Ao-L__1l?{J.sJu. elL.._ --------------.---------.-------------------.- \'1. b. e l1hub...tlasifg{{Lu------ .K ~Q__51kcp-c!s.~-~..-.JJl'J-c.-~ 0" -..... '- . \. In tM Coun of C_ P1cu of Cumberlud CoUllt,.. PcllftSyl\'ltUa ~~. _.CZk:..?:L'!.Lmu Clvtl. . .-ll\Oj~ty.!-S!.-. [JJI'.(.cIIL?-(l-r:.?. 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IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CIVIL ACTION - LAW FARMERS TRUST COMPANY, Plaintiff KEITH L. PLASTERER and KLP ENTERPRISES, INC. Defendants IN MORTGAGE FORECLOSURE CIVIL TERM NO. 'd 51$'1 ({"of '/,., COMPLAINT AND NOW, comes Farmers Trust Company, through its attorney, William A. Duncan, Esquire, and files this Complaint in Mortgage Foreclosure, of which the following is a statement: 1. Plaintiff is Farmers Trust Company, a corporation organized and existing under the laws of the Commonwealth of Pennsylvania with its main office and principal place of business located at 1 West High Street, Carlisle, CUmberland County, Pennsylvania 17013, 2. Defendants are KEITH L. PLASTERER, an adult individual residing at 36 Kelly Drive, Carlisle, Cumberland County, Pennsylvania, and KLP ENTERPRISES, a Pennsylvania Corporation with its principal place of business located at Apartment #704, Lindham Court, Mechanicsburg, Pennsylvania 3. On or about January 29. 1993, Defendant KLP Enterprises, Inc, executed and delivered to Plaintiff a mortgage and note financing Thn~e Million Eight Hundred Thousand Dollars and 00/100 ($3,900,000.00) Oollars, a copy of said mortgage and note are ~ttdched hereto as Exhibit. 'A' and '8', respectively, and are incorporated herein by refer.nee .. though fully .et forth. . 4. On or about January 29. 1993. Keith L. Plasterer signed a Guaranty and Suretyship Agreement to Farmers Trust Company in connection with the mortgage and note executed by KLP Enterprises, Inc. A copy of the Guaranty and Suretyship agreement is attached hereto as Exhibit "C" and is incorporated herein by reference as though fully set forth. 5. KLP Enterprises. Inc. is the sole record owner in fee simple of said premises subject to said mortgage, by virtue of a Deed dated December 29. 1992 and recorded on February 1, 1993 and recorded in the Cumberland County Recorder's Office in Record Book "C., Vol, 36, Page 904. more specifically set forth in Exhibit "0", attached hereto and made a part hereof by reference. 6. Said note and said real estate mortgage are in default because Defendants have failed to pay real estate taxes due and owing on the subject premises for 1995 County and Township and 1995 School taxes and 1995 Hydrant tax as stated in Article IV Events of Default: Remedies 4.01. 7. By reason of the aforesaid default, the entire principal balance of Three Million Three Hundred Forty-two Thousand Fifty-one Dollars and 4]!lOj ($3,342.051.431, with interest thereon at the rate of 8.50 \ percent per annu. computed from Septell'.b~r 16. U9". l.lte charges and attorney'. f.e. in the &lI1Ount of Cr:'t H..ndl"",j S...venty. four Thou.and Seven Hundred Seven Dollars -'r.d 00/10i:', ,n74,107.001 an now eN. and payable. . -. TABLE OF CONTENTS INTRODUCTION AND PARTIES.................................... 1 ~ RECITAlS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 GRANTING CI..AUSE............................................. 1 I. DEFINITIONS: REPRESENTATIONS AND WARRANTIES REGARDING TITLE AND HAZARDOUS SUBSTANCES 1.01 1.02 1.03 Det in! tiona. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Ti tIe. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Hazardous Substances............................. II. AFFIRMATIVE COVENANTS 2.01 2.02 2.03 2.04 2.05 2.06 2.01 2.08 2.0t 2.10 2.11 2.12 2.13 2.14 2.15 COlDpliance with Law.; Etc......................... Maintenance and R.pair............................ Alt.ration........................................ Inaurance............................. ............ DaaaCJe or Condemnation............................ Application of Insurance Proc..ds and COndeanation Aw.rd.......................... (a) JIortqaq.. Election... 11..................... Cb) Application to R..toration................. Cc) Permit., Plan.' Contracts.................. Cd) Payaent of Defici.ncy...................... Tax.. and IlIpoaition.: Mechanica' C:la1u. . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Tax and Inaurance Escrow.......................... Plnanclalltat...nt............................... 8.cu.ri~ Int.ere.t........................ ............ ea) ace S.curity Int.r..t...................... (b) r..ac:at1on8... . ... . .. .. .. ... .."..... .......... ... (e) COll.t.ral................................. (d) Prea.rv.tlon............................... (e) Pinancing St.t...nt........................ Vlaitation....................... ........ .... ........ titi,at1cn Affectinq Mortqaqed Property........... IncS.-ltlcat:lon. . . . . . 11 .. . . . . . . . . " .. . .. .. . . ... . . . . . . . . . .. Actions Iy Mort,_,.. to Pres.n. IIortva.c ProIMarty...................... .......... ... ..tappel Cartltlc.t............................... r;-1I fi I 1t2:.t 4 4 4 5 5 6 6 9 9 9 10 10 11 11 12 12 13 13 13 14 14 15 15 15 15 16 11 III. NEGATIVE COVENANTS 3.01 3.02 3.03 3.04 3.05 3.06 Liens: I.,eases..................................... Modifications to Property Restrictions............ Hazardous Substances.............................. Dissolution; Change of Business................... JtI1c1t1Ilt:Elcln8!1s. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ~~an!l~ers. . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . IV. EVENTS OF DEFAULT; REMEDIES 4.01 4.02 4.03 4.04 4.05 4.06 4.07 Events ot Default................................. IltazataclJ.tl... . . . . . . . . . . . . . . . . . . . . . . . . . . ... . .. . .. .. . . . . (a) Primary Remedies........................... (b) Rece! ver. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Cc) Cd) C.) Cf) Cg) Ch) (1) Insurance POlicies......................... Application ot Proceeds........................... Right to Sue Without Prejudic..................... Power to Modify Docum.nts......................... Remedie. CUmulativ................................ (a) Generally.. . . . .4o . . . . 4o.4o 4o4o . . . 4o. ..4o . 404o. 4o' . . . . (b) Other Security............................. Waiver of Stay, Ext.nsion, Moratorium Laws; Equity of R.demption...................... Environmental Site Assessments............. Right ot Set-ott........................... Sales by Parcels........................... Effect ot Sale............................. Eviction of Mortgagor Aft.r Sal............ Contession ot Judgment for Ejectment....... V. MISCELLANEOUS 5.01 5.02 5.03 5.04 5.05 5.06 5.07 Security and Priority of Advanc.s................. (a) t.oan Advance............................... (b) Other Advanc... . . . . . . . .. . . . . . . ... .. . . . . . . . . Olanq.. 1n Tax I.aw....404o.......................... Further Aaauranc:.............4o...404o4o.............. (. ) Generally. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (b) F 11 iftCJ.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Aaendaenta, Waiv.ra. Etc.......................... No Iap11ed Waiver................................. Notic... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Expena..: Tax.a: Attorney.' r..................... - 11 - r...,.., I, I ' .:- , :JJJfJ ~ 17 17 17 18 18 18 18 21 22 23 23 24 24 25 25 26 26 26 27 27 27 28 28 28 29 29 29 30 30 30 30 30 ]0 30 31 , , ., J , I J I 5.08 5.09 5.10 5.11 5.12 5.13 5.14 S.lS Assiqnment ot Leases.............................. Jurisdiction: EtC................................. Interpreta tion. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Invalidity of Certain Provisions.................. Severability. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Governinq I.aw..................................... Time of Essence; Duration; Survival............... SUccessors and Assigns............................ Wi; Exhibit A Legal Description 32 32 32 33 33 33 32 33 .. tit - , rn;! liS .!~ U~l III. NEGATIVE COVENANTS 3.01 3.02 3.03 3.04 3.05 3.06 Liens; I..eases..................................... Modifications to Property Restrictions............ Hazardous substances.............................. Dissolution; Change of Business................... Indebtedness. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Transfers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV. EVENTS OF DEFAULT; REMEDIES 4.01 4.02 4.03 4.04 4.05 4.06 4.07 Events ot Detaul t. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Rea.di... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (a) Primary Remedies........................... (b ) Receiver. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (c) Environmental Site AssesS1ll.nts............. Cd) Right ot Set-ort........................... ee) Sale. by Parcels........................... (f) Effect ot Sal.............................. (g) Eviction of Mortqagor Aftar Sal............ (h) Confusion of Judgment for Ej.cbllent....... (1) Insurance Polici........................... Application ot Proc.eds........................... Right to Sue Without Prejudic..................... Pow.r to MOdify Docuaents......................... Rem.di.. cumulativ................................ (a) aanerally.... . . . . ...... . ... . ... . . . . ..... ... (b) Other security............................. Waiv.r of Stay, Extenaion, Moratorium Lav.: Equity of R.damption...................... V. MISCELLANEOUS 5.01 5.02 5.03 5.04 5.05 5.06 5.07 Security and Priority of Advance.................. eel Loan Advance.... . ... .... .... ... . ... .... . ... (11) other Advanc.................................. Olanq.. in Tax ~v..................................... Further Aaauranc....... .... . .. . . . .. .... ........... .... (.) Generally. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (b) r111"'......... . ................ ................ AaancSaenta, V.iv.ra, Itc........................... No taplittd ".lv.r................................. ltot1c:... . . . . . . . . . . . . . .. . . . . . . .. . . . . . .. . .. .. .. .. .. .. . .. . . .. .. . . Ixpena..: Taxa., Attorn.,.' Peea.................. - 11 - r-; ... ~ 17 17 17 18 18 18 18 21 22 23 23 24 24 25 25 26 26 26 27 27 27 28 28 28 29 29 29 :SO :so :SO :so :so 30 30 )l OPEN-END MORTGAGE AND SECURITY AGREEMENT THIS OPEN-END MORTGAGE AND SECURITY AGREEMENT (this "Mortgage"), dated as ot January 29, 1993, made by I<LP ENTERPRISES, INC., a Pennsylvania corporation having an ottice at Apartment 704, 1101 Lindham Court, Mechanicsburg, Pennsylvania 17055 ("Mortgagor"), to FARMERS TRUST COMPANY, a penn.ylvania corporation, having an ottice at One West High Street, Carlisle, Pennsylvania 17013 ("Mortgagee"), ti 1 I H ~ ~ ~ ~ I H: WHEREAS, Mortgagor is justly indebted to Mortgagee in the principal .um ot Three Million Eight Hundred Thou.and and No/lOa Dollars ($3,800,000), as evidenced by, and to be repaid with interest thereon in accordance with, a promis.ory note ot even date herewith made by Mortgagor to Mortgagee (a. the .ame may be extended, renewed, retinanced, retunded, amended, modi tied or supplemented trom time to time, and any replacement or .uccessor note, the "Note"): NOW, THEREFORE, in consideration ot $10.00 and other qood and valuable consideration, the receipt ot which is hereby acknowledged, and in ord.r to s.cure: (al the paym.nt ot the ind.bt.dn.ss evidenced by the Note, both principal and int.r.st, .nd all .mounts due or to b.com. due und.r the Not., this Mortgag. .nd any oth.r loan docum.nt. .x.cut.d 1n conn.ction th.re- with, .nd any .xt.nsion., r.n.wal., r.placem.nts or moditications ot any th.reot (the "Loan Docu.ent."): and (bl the p.rtormance and obs.rv.nc. ot .11 cov.- nanta, .gr....nt., obligation. and liabilitie. ot Mortgagor under or pursuant to the provision. ot the Hote, thia Mortg.q. .nd the other Lo.n Document., and .ny .xtensions, r.n.wals, replace..nt. or soditications or .ny ther.ot: (allot the toregoing being hereinatter collectiv.ly called the .Secured Obligation."l, Mortgagor. intending to be legally bound, doe. hereby grant, bargain. ..11. conv.y, w.rrant. a.sign. tran.- ter. mortqag., pledge. grant 4 ..curity int.re.t in. ..t ov.r and contirm unto Mortgagee. and ita aucce.eor. and a.s1gn.. all or Mortgagor'. ..tate. right. title. int.re.t. property, claim and deaand. now owned or held or hereatter acquired or ar1.inq. In -.<, , l . . . ' tJ32 and to the following property and rights (collectively, the "Mortgaged Property"): (a) the lands and premises more particularly described in Exhibit A hereto, together with all and singular the tenements, hereditaments and appurtenances thereunto belonging or in anywise appertaining, and also (i) any land lying within the right-of-way of any streets, open or proposed, adjoining the same, (ii) any easements, rights-of-way and rights used in connection therewith or as a means of access thereto, and (iii) any and all sidewalks, alleys, strips and gores of land adjacent thereto or used in connection therewith (all of the foregoing being hereinafter collectively called the "Land") 1 (b) all buildings, structures and other improve- ments now or hereafter erected or placed on the Land (collectively, the "Improvements"); (c) all materials, machinery, apparatu., .quip- .ent, fittings, fixtures, goods, chattels and other articl.s of personal property now or hereafter located on, attached to or used in connection with the Land or the Improvements (other than any personal property own.d by any tenant occupying the Improvem.nts and used by such tenant in connection with such occupancy), and all r.placements thereof, addition. thereto and .ub- stitution. therefor (all of the foreqoing, being h.r.inafter collectively called the "Equipment"), toq.th.r with all d.po.ita or payments mad. on any lquip..nt in connection with the conditional purcha.. th.r.of and all 1..... by Mortgagor a. 1..... of lquip- ..nt: (d) .11 lic.na... peraita. authorizations and aqr....nta frea Gov.rnmental Authoriti.. (a. defined in Section 1.02) rel.ting to the ownership. con.truction, occupancy, operation. unaq...nt or use of the Land. the IlIprov.menta or the Equipaent: (e) .11 contracta. license. and aqneaenu relat- i"9 to the own.rship. de.iqn. conatructlon. occupancy. operation. unaq...nt or use of tn. Land. the Iaprove- menta or the lquipaent: - oJ - .- "I:' . .."..... , , .. >-l' 'I ~N Cf) all the remainder or remainders, reversion or reversions, rents, revenues, issues, protits, royal- ties, income and other benefits derived trom any ot the foregoing, all of which are hereby assigned to Mort- gagee, who is hereby author;~ed to collect and receive the same, to give proper receipts and acquittances therefor and to apply the same to the payment ot the Secured Obligations, notwithstanding the tact that the same may not then be due and payable, subject, however, to the right of Mortgagor to receive and use the same unless and until an Event ot Oetault Cas detined in Section 4.01) shall occur: (g) all proceeds ot the conversion, voluntary or involuntary, ot any of the toregoing into cash or liquidated claims, including all proceeds ot the insur- ance required to b. maintain.d by this Mortgage, all awards or oth.r compensation h.retotore or hereafter made to Mortgagor as the r.sult ot any Condemnation (as defined in Section 2.05), all awards tor changes ot the grades of street. and all awards tor severance damages, allot which are h.r.by aeeigned to Mortgagee, who is hereby authorized to collect and receive the proceeds ther.of, to qiv. prop.r r.c.ipts and acquittanc.s therefor and, subj.ct to Section 2.06, to apply the same to the paym.nt ot the S.cured Obligations, not- withstanding the tact that the aame may not then be due and payabla: (h) any monies deposit.d with Mortgagee pursuant to the terms hereot or ot any other Loan Document; (i) all .quipment, inv.ntory, accounts, contract riqht., gen.ral intangibles, instrument., documents and chatt.l pap.r (as those terms are d.tined in the Uni- torm co.aercial code) ot Mortqaqor: and (j) all proceeds, beth cash and non-cash, ot any and all of the foreqelnq: TO HAVE AND TO MOLD the Mortgaged Prop.rty unto Mortqaqe., its succe..or. and a.sign., tor.v.r: PROVIDED, IlOWEVD, that it Mortqaqor shall pay, perform and diacharqe the Secured Obl.1qaUons In full, then thi. Mort.,a.,. and the estat. hereby ,ranted ahall c...., terminate 4nd beco8e voId: - J - ,-'~ f! I:; . JJ34- AND, Mortgagor hereby agrees with Mortgagee ARTICLE I DEFINITIONS: REPRESENTATIONS AND WARRANTIE! REGARDING TITLE AND ABSENCE OF HAZARDOUS SUBSTi 1.01. Definitions. Capitalized terms used here: not defined herein shall have the meanings assigned tc the other Loan Documents. 1.02. Title. Mortgagor represents and warrants Mortgagee that based upon the marked title commitment issued by Ticor Title Insurance Company, Mortgagor (a: and marketable fee simple title to the Land and the II and has good title to all Equipment and other propert~ comprising the Mortgaged Property, subject to no mort~ pledge, charge, security interest or other encumbrancl claim of any nature except Permitted Encumbrances (as this Section 1.02), and (b) has full power and lawful to grant, bargain, sell, convey, warrant, assign, trar mortgage, pledge, grant a security interest in, set 0\ confirm unto Mortgagee, and its successors and assign! Mortgaged Property as herein provided. Mortgagor will warrant and defend the title to the Mortgaged Propert} validity and first priority ot the lien or estate, ant security interest, created hereby against the claims a of all persons whomsoever. As used herein the term "f Encumbrances" means (i) the easements, rights of way a exceptions set torth in Schedule 8-1 ot the title poli the lien of this Mortgager (ii) liens in favor of Mort (iii) inchoate liens tor taxes, assessments or similar which are not due and payable or are being contested i faith at the time pursuant to and in compliance with t requirements of Section 2.07. 1.03. Hazardous Substances. Hazardous wastes, h substance., hazardous ..terial., toxic substances, haz pollutants or toxic pollutants, as those terms are use, defined in or listed under the Resource Conservation al Act, the Comprehensive Environmental Response, Compens, Liability Act, the Hazardous Materials Transportation ; Toxic Substances Control Act, the Clean Air Act and th. Water Act, or in any regulations proaulqatinq pursuant or in any other applicable Law, includinq without limit tho.. .leaenta or compound. which are contained in the hazardous .Ubstance. adopted by the United State. [nvir - .. - -,. " 1:. . " J5 Protection Agency or the list of toxic pollutants designated by Congress or said agency, or petroleum products, including without limitation, gasoline, diesel fuel, fuel oil, heating oil, kerosene, motor oil, used oil and waste oil (all of the foregoing are herein collectively called "Hazardous substances"): and Hazardous Substances described herein as to which Mortgagor remains in compliance with all applicable Laws relating to the receipt, handling, use, storage, treatment, shipment or disposal of the same are herein collectively called "Permitted Sub- stances". As used herein the term "Law" means any law, constitution, statute, treaty, regulation, rule, ordinance, order, injunction, writ, decree or award of, or permit, approval or license granted by, any Governmental Authority, including those relating to zoning, .ubdivision, building, safety, fire protection or environmental matters. As used herein the term "Governmental Authority" means any government or political subdivision or any agency, authority, bureau, central bank, commission, department or instrumentality of either, or any court, tribunal, grand jury or arbitrator, in .ach case whether foreign or domestic. ARTICLE II AFFIRMATIVE COVENANTS Mortgagor covenants to Mortgagee .. follows: 2.01. Comnliance with Lawe: Etc. Mortgagor shall comply with all Laws and all private covenants which at any time are applicabl. to the Mortgaged Property or Mortgagor, and .hall comply with the requir.ments of all polici.s of insurance required by this Mortgage and of the insurers under .uch polici... Mortgagor .hall max. any r.plac.m.nt., alt.ration. or improvem.nts to the Mortgaqad Property a. may b. r.quir.d by Law or such requirem.nts .v.n if unfor....n and/or .xtraordinary. Notwithstanding the foreqoinq, but provid.d Mortgag.... int.rests in the Mortgaged Property ar. not pr.judiced in Mortgag.... r.asonabl. jUdgment, nothing contained in this Section 2.01 .hall pr.v.nt Mortgagor from cont.sting, dilig.ntly and in good faith, complianc. with any .uch law. or privat. cov.nants and Mortgagor ahall not be obligated to comply with the provi.ion. Of thi. Section 2.01 until auch time as such conte.t 1. adv.rsely d.tenained. 2.02. "..int.n.a~e and Repair. Mortqaqor shall not ab.ndon or cau.e or plInait any wat. to the Iaprov...nu or the lqu1p- - I: - \ '1!1: ' IJ~ ment, shall maintain the Improvements and the Equipmer repair, working order and condition, except for reasor and use, and shall restore, replace or rebuild the Im~ and the Equipment or any part thereof now or hereafter destroyed by any casualty (whether or not insured agai insurable) or affected by any Condemnation (as definee with Improvements or Equipment of equivalent value ane whether or not the proceeds of insurance required herE the award payable in respect of such Condemnation are for the purpose or are available to Mortgagor pursuant 2.06 for the purpose. All repairs, replacements, rest alterations and improvements to the Mortgaged Propert~ promptly performed in a good and workmanlike manner ir with all applicable LaWs, private covenants and insur, requirements, shall be equivalent in quality of constl class to the original construction of the Improvementf "Project") and shall be subject to the terms and condi forth in Section 2.06(c) as if such repair, replacemer tion, alteration or improvement were a restoration thE 2.03. Alterations. Mortgagor shall not permit t ments or the Equipment to be removed, demolished or mi altered: provided, however, that Mortgagor (i) shall n replacements, alterations or improvements which are rE Law (ii) may remove worn out Equipment if the same is rently replaced with Equipment of equivalent value anc and (iii) may make alterations to the Improvements wit Mortgagee's consent provided the coat of all such altE durinq any twelve (12) month period does not exceed tt $50,000 and provided such alteration does not material the value of the Mortgaged Property. 2.04. Insurance. Unl..s waived in writing by Me Mortgaqor ahal~ maintain and keep in effect the follow policies of insurance: (al policies of insurance against loss or d to the Iaprovements and the Equipment by or from lightning, windstorm, explosion. riot. riot at~en strike. civil coaaotion. aircraft and vehiclea, s. end such other hazerds .. are presently included so-called "fire and extended coverage" insurance: vandaU.., uUcious aischief and such other hata are pre.ently included in the so-called "all risk: physical 10... insurance: and sucn other insurabl. hazards, includl~ flood. .., under good Insuranc. practic.s, from ti.. to ti.. are Insur.d aqAlnat t .6- ;";' . t t . , f . t, ~ 1J~; improvements and equipment having similar funetie uses in the area where the Improvements and Equi~ are located, in an amount which shall not be lesE the greater of (i) 100\ of the "full replacement of the Improvements and the Equipment, without de tion for physical depreciation, or (ii) an amount sufficient to prevent Mortgagee and Mortgagor fre becoming co-insurers within the terms of the appl policies: the term "full replacement cost" shall the actual cost of replacing the Improvements anc Equipment, exclusive of the cost of excavations, dations and footings below the lowest basement fl and shall be determined from time to time at the request of Mortgagee (but not more frequently the in any 24 calendar months) at the expense of Mort by an insurer or bl' an appraiser, engineer, arch! or contractor designated by Mortgagor and approve Mortgagee: (b) insurance against loss or damage to the components of the air conditioning and heating sy flywheels, steam pipes, eteam turbines, steam eng steam boilers, other pressure vessels, high press piping and machinery and elevators and escalators any, as are installed in the Improvements, inelud insurance against physical damage to the Improve~ and the Equipment arising out of an accident cove thereunder and against 10.. of occupancy or use a from breakdown of any of the foregoing, 1n such a a. are satisfactory to Mortgagee: (c) comprehensive general liability 1nsuran an .occurrence ba.i.. against claims for bodily 11 death or property damage occurring on or about tho Mortgaged Property (including elevators and escal. if any) and on or in the streets adjoining the sa: afford protection 1n a ..ingle limitN of not less $1,000,000 in the event of bodily injury to or de, any number of persona or at damage to property ar: out ot one occurrence: (d) if the Land or any part thentOt is situ.:. an area de.ignated by the rederal ~rqency MAnaq~ Aqency (or any aucce.sor thereto) as an are. of Sf flood hazard tor purpoae. ot the National Flood In .nee Progra., such poUc:1.. ot flood insurance .... Mortqaqee aball r.quest. 80 a. to enable MortqAq.. 1 - -- . 11 .... I . ~ ~ ,..,; , J1~ be in compliance with all Laws with respect to flood, insurance coverage for the Mortgaged Property from tlme to time applicable to Mortgagee; (e) business interruption insurance and insurance against loss of "rental value" for a period of twelve months, in such amounts as are satisfactory to Mort- gagee; and (f) such other insurance with respect to the Mortgaged Property in such amounts as may from time to time be reasonably required by Mortgagee against other insurable hazards or casualties which at the time are commonly insured against in the case of premises similarly situated, due regard being given to the height and type of buildings and improvements, their construction, location, use and occupancy. All policies of insurance shall be subject to the reasonable approval of Mortgagee as to insurance companies, amounts, expiration dates, form and content and shall name Mortgagee as an additional insured. All policies of insurance maintained by Mortgagor pursuant to clause ea) shall contain the "replacement cost endorsement". All policies of insurance covering risks of physical loss shall provide that losses thereunder ahall be payable to Mortgagee pursuant to a standard first mortgagee endorsement, without contribution, substantially equivalent to the New York standard mortgagee endorsement. At least 30 days prior to the expiration of any policy of insurance, Mortgagor shall furnish Mortgagee with evidence satisfactory to Mortgagee of the payment of the premium for, and the reiaauance of a policy continuing, such insurance as required by this Mortgage. All policies of insurance shall contain an endorsement by the inaurer that any loaa ahall be payable in accordance with the terms of such policy notwithstanding any act or negligence of Mortgagor which might otherwiae give rise to a defense by the insurer to its payment for such 10s8 and a waiver by the insurer of all rights of subrogation to any rights of Mortgagee and of all rights of set-Oft, counterclaim or deduction against the insureds. All policies of insurance shall alao contain a provi- sion to the .ffect that any cancellation of or amendment to .uch insurance, including any reduction in the scope or limits of coverage, shall not b. ettective as to Mortgag.. without at least 30 day.' prior written notice to Mortgagee. Mortgagor shall not take out .eparate insurance with r.spect to the Mortgaged Prop- erty concurrent in form or contributinq in the event ot 10.. with that required by thia Mortgage unl... the .... shall contain I - . - · . Ii:': . U~ standard non-contributory lender's loss payable endorsement in favor of and in scope and form satisfactory to Mortgagee. 2.05. Damaae or Condemnation. In the event of any damage to or destruction of the Improvements or the Equipment or any part thereof as a result of any casualty ("Damage"), or in the event the Land, the Improvements or the Equipment or any part thereof are taken or damaged as the result of the exercise of the power of eminent domain or as the result of any other govern- mental action for which compensation shall be given by any Governmental Authority ("Condemnation"), or if Mortgagor shall receive any notice or advice of any Condemnation proceedings, Mortgagor shall give prompt notice thereof to Mortgagee. In the event that Mortgagor shall fail to promptly settle, adjust or compromise any claims by Mortgagor for Damage under any policy or policies of insurance required to be maintained by this Mortgage, or any claims for awards or other compensation payable in connection with any Condemnation, Mortgagee shall have the right, and is hereby authorized and empowered and irrevocably appointed attorney-in-fact of Mortgagor, to settle, adjust or compromise any claims by Mortgagor tor Damage under any policy or policies of insurance required to be maintained by this Mortgage, or any claims for awards or other compensation payable in connection with any Condemnation, except, so long as no Event of Default exists, those claims involving amounts ot less than $50,000. 2.06. ADDlication of Insurance Proceeds and Condemnation Awards. (a) Mortaaaee Election. All proceeds ot the insurance required to be maintained by this Mortgage (including proceeds of bu.ine.s interruption or loss of rental value insurance) payable in connection with any Damage, and all awards or other compensation payable in connection with any Condemnation, shall be deposited with Mortgagee, except that any such proceeds or awards or other compensation aggregating lesa than $50,000 shall not be required to be so deposited. Provided no Event of Default exists, such proceeds or awards or other compensation (after deductinq therefrom all rea.onable costs and expenses, includ1nq attorney.' fees, incurred by Mortgag.e 1n connect10n with the collection thereof reqardle.s of the particular nature thereof and vbether incurred with or without suit) (WNet ProceedsW), shall be applied by Kortgaqee to the pey.ent of the costs ot restorinq the IlIprove_nt. and Iqu1paent so damaged or taken to their value, utility - , ... .,. ",. , ~. 4.~ , " .ect and condition immediately prior to such Damage Ot Condemnation (collectively, "Restoration Costs"). (b) ADDlication to Restoration. Mortgagor deposit with Mortgagee such additional amounts ot as may be necessary so that the Net Proceeds and additional monies (collectively, "Restoration Fur will be sufficient, in the reasonable judgment 01 Mortgagee, to pay all Restoration Costs during St restoration. Such Restoration Funds will be adve by Mortgagee from time to time as the restoratior progresses upon the written request of Mortgagor subject to compliance by Mortgagor with such rea~ requirements and conditions as Mortgagee shall iT Mortgagee shall not be required to apply Restorat Funds as aforesaid unless it reasonably determinE the amount thereof remaining after payment of thE amount requested will be sufficient to pay the Restoration Costs in full, and Mortgagor shall pt deposit with Mortgagee the amount of any deficier be held and disbursed by Mortgagee as Restoratior in accordance with the provisions of this Sectior Upon completion of such restoration to the satist of Mortgagee and the payment of the Restoration C in full, the balance of any Restoration Funds not required to be disbursed shall (i) in the case ot Damage, be disbursed to Mortgagor or as Mortgagot direct and (ii) in the case of a Condemnation, bE applied to the payment of the Secured Obligations such order as Mortgagee may determine until the 5 bave be.n paid in full and then to Mortgagor or a Mortgagor may direct. (e) Permits: Plans: Contracts. All restora vor~ following any Damage or Condemnation pursuan thls Mortgage ahall be subject to the following t and concii tiona: (1) no work ahall be undertaken unless Mortgagor shall have procured and ~id for a peraita. approvals and authorizations of all Covernmental Authoriti.s required In connect with all of the work: and (li) all work Involvlng estiaated Re.tol COat. of acre than $50,000 (e.elusive of Pro' debt auvlce) (x) ~ll be de.1CJMd. con.tnh - 10 - ,-:, ~ !~.j . 114J and completed in accordance with detailed plans and specifications and cost estimates reasonably acceptable to Mortgagee and prepared by an architect or engineer selected by Mortgagor and reasonably satisfactory to Mortgagee and (y) shall be performed pursuant to fixed price construction contracts which are secured by payment and perfor- mance bonds in the amount of such contracts, such contracts and bonds to be in form and substance, and with contractors and sureties, reasonably satisfactory to Mortgagee and to be executed and delivered prior to the commencement of any of the work. (d) pavment of Deficiencv. It (i) in the reason- able judqment of Mortgagee the Mortgaged Property cannot be restored substantially to the value, utility and condition thereof immediately prior to such Damage or Condemnation or such restoration cannot be expected to be completed by the date upon which the unpaid principal balance of the Note and all unpaid interest and other sums under the Loan Documents are due and payable (the "Maturity Date"), and (ii) the Net Proceeds are not sufficient to pay the Secured Obliga- tions in full, Mortgagor .hall promptly pay the defi- ciency. 2.07. Taxes and ImDositions: Mechanics' Claims. Mortgagor .hall pay, before any tine, penalty, interest or cost attaches thereto, all taxes and asses.ments, general and .pecial, all water and .ewer rents and all governmental charge. and levies of any kind or nature whatsoever, which are now or hereafter asse..ed or impo.ed upon the Mortgag.d Property or Mortgagor or become due and payable trom Mortgagor or create a lien upon the Mortgaged Property (all .uch taxe., a.....m.nt.. r.nts, charg.. and levies being h.rein coll.ctiv.ly called "Impositions"). a. well a. all claims tor labor, ..terials or services which. if unpaid. might become a lien th.reon (herein collectively called "Mechanic.' Claims"). and shall turnish to Mortgagee promptly upon Mortgagee'. r.qu..t and as .oon a. reasonably possibl.. official receipts of the appropriate taxing or oth.r authority. or oth.r proof .atistactory to Mortgagee. evid.ncing the par-ent of all Imposition.: provided. however. that it by law any Impo.ition i. payable. or ..y at the option of the taxpay.r be paid. in installment.. Kort9aqor ..y pay the ..... or cause the same to be paid. toqether with any accrued inter..t on the unpaid balance thereot. in in.tall..nts a. the .... beco.e due and - 11 - ,-.. t !'. . 1142. ~ !, .. """ before any fine, penalty, interest or cost may be added thereto for the nonpayment thereof: and provided, further, that, if Mortgagor (a) contests the validity or amount of any Imposition or Mechanic's Claim in good faith and by appropriate proceedings which operate to prevent any execution on any portion of the Mortgaged Property, (b) deposits and maintains with Mortgagee a bond or other security satisfactory to Mortgagee in such amount as Mortgagee shall reasonably require to assure the discharge thereof, (c) thereafter diligently proceeds to cause such Imposition or Mechanics' Claim to be removed, paid or discharged of record, Mortgagor may defer payment thereof during the pendency of such contest. 2.08. Tax and Insurance Escrow. If requested by Mortgagee, Mortgagor shall pay to Mortgagee on the first day of each calen- dar month a sum equal to one-twelfth (1/12th) of the real estate taxes on the Mortgaged Property and premiums for insurance required hereby so as to enable Mortgagee to pay the same at least thirty days before they become due and Mortgagee shall do so. Amounts so paid shall not be trust funds but may at the option of Mortgagee be commingled with general funds of Mortgagee. No interest shall be paid on such amounts. If an Event of Default shall occur, Mortgagee shall have the right to apply any amounts paid to Mortgagee under this Section 2.08 against all or any part of the Secured Obligations. If such real estate taxes and insurance premiums shall exceed the amounts paid into escrow under this Section 2.08, Mortgagor shall on demand pay the deficiency. Mortgagor shall furnish to Mortgagee tax and insurance bills in sufficient time to enable Mortgagee to pay such taxes and premiums, before interest and penalties accrue thereon. 2.09. Pinancial Statements. Mortgagor shall furnish or caused to be furnished to Mortgage.: (a) for Mortgagor, and any Cuarantor. within 90 daya after the end ot eaCh of ita fiacal years, a balance she.t aa of the end of such Uacal year and atate..nta of income. retained earninqa or partnera' capital (a. the ca.. hY be) and cash tlova for auch fiscal year, settlnq forth in c:oaparatlve lora the ccrreapondinq f19Ures tor the precedinq Uacal ye.ar, all in reasonable detail, prepared 1n accordance with aMP by independent publ1c acc:ount.anU of recoqnhltd standlnq ..l.cted by Xortq.qor and raaaonably aatialac- tory to Mortqaq"l ., l..l - . .. I I f" . f " ,..~ \ 1J.f3 (b) for Mortgagor, and any Guarantor, with days after the end of the first half of each of fiscal years, a balance sheet as of the close of period and statements of income, retained earnin, partners' equity (as the case may be) and cash f: for such period, all in reasonable detail and prl in accordance with GAAP, subject, however, to ye, audit adjustments, and certified by the Mortgago: any Guarantor, as the case may be: (c) within 45 days after the end of each c. quarter, a financial statement covering the oper. of the Mortgaged Property for such calendar quar1 and setting forth in such detail as Mortgagee sh, reasonably request, the status of leasing, the il expenses and cash flow and other financial inforr relating to the Mortgaged Property, which financ: statements shall be certified by the Mortgagor: (d) for Mortgagor, and any Guarantor, with: days after the filing thereof, a copy of its fedE income tax return for each year: (e) with reasonable promptness, such other cial and other information respecting the financi condition, business or operations of Mortgagor ar Guarantor, as Mortgagee may from time to time reasonably request. With respect to those tinane statements which are required to be certified by Mortgagor, and any Guarantor, such certification stat. that such financial statements are complete correct, were prepared in accordance with GAAP an fairly present the financial condition at the res tive dates indicated therein and the results of 0 tions tor the respective periods indicated therei Mortgagor (and its subsidiariss), and any Guarant (and its Subsidiaries). 2.10. S.curitv In~.r..t. (a) UCC Security Interest. This Mortgage Ct .titute. both a aortqage and a ..ecurity agreement within the ..aninq of the Unifora eaa..rcial Code the applicable 'urisdiction (the .ucc.) , an~ the ~ 9a9ed Property inchad.s both real and penonal pre and all other rigbts and interests, Whether tanqlt intanqlble in nature, of Mortgagor 1n the "ortqaq~ - 11 - , .'. ri . 11 44 Property. Mortgagor by executing and delivering this Mortgage has granted to Mortgagee, as security for the Secured obligations, a security interest in and to (i) those portions of the Mortgaged Property in which a security interest can be granted under the UCC, and (ii) the Collateral, as defined below. Portions of the Mortgaged Property are or are to become fixtures as defined in the UCC. This Mortgage constitutes and is effective as a fixture filing as provided in Section 9402 of the UCC. (b) Locations. Mortgagor shall maintain and keep the Equipment on the Land: shall maintain and keep its principal place of business and its chief executive office at its address stated on the first page hereof and at no other location without thirty days' prior written notice to Mortgagee: and shall maintain and keep its records concerning the Mortgaged Property at the Improvements and at no other location without prior written notice to Mortgagee. (c) Collateral. .Collateral" means all of the following property of Mortgagor whether now owned or hereafter acquired or arising: Inventory, Accounts, money, deposit accounts, equipment, fixtures, general intangibles, chattel paper, instruments, documents and goods (as each of the preceding terms are defined in the UCC), accounts receivable, machinery and all other tangible and intangible personal property of Mortgagor of every nature and description, and all substitutions, replacements, accessions and proceeds of all of the foregoing (inClUding, without limitation, insurance proceed. .nd condemnation .wards). (d) Preservation. The Mortgagor will preserve the COllateral and .11 property used or useful in the conduct of the operations of the Mortg.gor, .nd ke.p the aa.e in good condition and repair (normal wear and tear excepted), .nd from ti.e to time mak., or cauae to b. made, .11 nec....ry .nd prop.r repaira, renew.ls, repl.cementa, betterment. .nd improvements thereto. The Mortgagor vill defend the Collateral .gainst all clai.. and demands of all peraona at any ti.e claiming the aa.e or any interest therein .nd, 1n the event the Mortgagee'. .ecurity intere.t in the Collateral. or any pan thereof, would be impaired by an adv.ra. dec:idon, allow the Mortgage. to cont..t or detend any such claim - 14 - \- . t. "" ; ~. or demand in the name of the Mortgagor and the Mortga- gor agrees to pay, upon demand, the Mortgagee's reason- able costs, charges and expenses, including, without limitation, reasonable attorney's fees, in connection therewith. (e) Financina statements. From time to time, at the request of the Mortgagee, the Mortgagor shall execute, deliver and file all financing statements on Form UCC-1 or other instruments, and do all other acts as the Mortgagee deems necessary or desirable to per- fect fully, or to keep perfected, its security interest in the Collateral and pay upon demand all reasonable expenses, including, without limitation, attorney's fees, incurred by the Mortgagee in connection there- with. 2.11. Visitation. During normal business hours and upon reasonable notice, Mortgagor shall permit such persons as Mortgagee may designate to visit and inspect the Mortgaged Prop- erty, to examine the books, records and documents relating to the Mortgaged Property and take copies and extracts therefrom at normal business hours upon reasonable notice and to discuss the affairs of the Mortgagor relating thereto with the independent accountants of Mortgagor at such times and as often as Mortqagee may reasonably request. Mortgagor hereby authorizes such independent accountants to discuss with Mortgagee the affairs of the Mortgagor. 2.12. Li tiaation Attectina Mortaaaed PrQD8rtv. Mortgagor shall appear in and contest any judicial or quasi judicial action or proceeding purporting to affect the security hereof or the rights or powers at Mortgagee, and shall pay within a reasonable time after demand theretor all costs and expenses, including costs ot evidence of title and attarneys' tees, in any such action or proceeding in which Mortgagee may appear. 2.13. Indemnitication. Mortgagee shall have no obligation or liability by reason ot this Mortgage (or the liens or security interests in the Mortgaged Property granted hereby) or arising out ot the Mortgaged Property, nor shall Mortgagee be required or 'Obligated in any aanner to pertor. or tultill any Obligations ot Mortgagor with respect to the Mortqaqed Property. With the exception ot negligent acts and omis.ions of Mortgagee, or its agents, servanu, _ploy_s 'Or contractors, Mortgaqor hereby agrees to indeanity and defend Mortgagee aqain.t, and hold Mortgagee baral.ss trea, all costs, tin.., penal tie., t.e. - is - ~ IU:' I' 1141; (including, without limitation, attorneys' fees), expense~, liabilities, losses, claims and damages that may at any tlme be asserted against or incurred by Mortgagee as a result of, or arising out of, or in any way related to or by reason of any Event of Default under this Mortgage (or the liens or security interests in the Mortgaged Property granted hereby), or any other Loan Document, including any cost, fine, penalty, fee, expense, liability, loss, claim or damage arising from or related to Hazardous Substances or any Law concerning Hazardous Substances or other environmental matters relating to conditions that occur subsequent to the date of this Mortgage and including any and all claims and demands whatsoever which may be asserted against Mortgagee by reason of any alleged obligation on its part to perform or discharge any obligation with respect to the Mortgaged Property. 2.14. Actions bv Mortaaaee to Preserve Mortaaaed Procertv. If Mortgagor shall fail to (a) effect, maintain and keep in force the insurance required under the provisions of Section 2.04, (b) make the payments required by Section 2.07 or (c) pay, perform or observe any of the other obligations required by this Mortgage or any other Loan Document to be paid, performed or observed by Mortgagor, then Mortgagee may effect, maintain, keep in force, pay, perform or observe the same. In connection therewith, Mortgagee shall have the right, but not the obligation, (i) upon the occurrence of an Event of Default, to enter upon and take possession of the Mortgaged Property: (ii) to make such additions, alterations, repairs and improvements to the Mortgaged Property as Mortgagee may reasonably consider necessary or proper to keep the same in good condition and repair: (iii) to appear and participate in any action or proceeding affecting or which may affect the security hereof or thereof or the rights or powers of Mortgagee hereunder or thereunder: (iv) to contest or compromise any lien, encumbrance or charge which in the reasonable judgment of Mortgagee may affect the security of this Mortgage or any other Loan Document, or to discharge the same, either by paying the amount claimed to be due or depositing in court a bond for the amount claimed or otherwise giving security for such claim. or in such other manner as is or may be prescribed by law: and (V) in exercising such powers, to pay necessary and reasonable expenses including the tees and expenses of attorneys and all necessary or desirable consultants. All su~s so expended by Mortgagee or expended to sustain the lien or est3te or security interest created by this Mortgage or any other Lo3n Document Or the priority hereof or thereot. Or to protect or entorce any of the rights ot Mortgagee under the teras ot this Mortgage or any other Loan Document. or to recover or entorce any - 16 - .... , IE 1147 of the Secured Obligations or otherwise to secure the performance of any obligation of Mortgagor under this Mortgage or any other Loan Document, shall be paid by Mortgagor within five days after demand by Mortgagee with interest at the Default Rate (as defined in the Note) until paid. In any action or proceeding to foreclose this Mortgage, or to recover, collect or enforce the Secured Obligations, the provisions of law respecting the recovery of costs, disbursements and allowances shall prevail unaffected by this covenant. 2.15. Estoccel Certificates. Mortgagor, within ten days after notice from Mortgagee stating the amount of and the method of calculation of the Secured Obligations, shall furnish to Mortgagee a statement confirming the amount of the Secured Obligations and stating whether any offsets or defenses exist against the Secured Obligations. ARTICLE III NEGATIVE COVENANTS Mortgagor covenants to Mortgagee as follows: 3.01. Liens: Leases. Subject to the provisions of Section 4.01(h) below, Mortgagor shall not create, permit to accrue or suffer to exist any assignment, mortgage, lien, .ecurity intere.t, pledge, conditional sale or other title retention agreement, encumbrance or charge ot, in, to or upon the Mortgaged Property, other than Permitted Encumbrance.. Mortgagor shall not, without the prior written consent of Mortgagee, lea.e (as le.see) any of the Equipment or Improvements except in the ordinary course of busine.s. 3.02. Modifications to ProDertv Restrictions. Mortgagor shall not initiate, join in or consent to any change in any private covenant, zoning ordinance or other public or private restriction which would detract from or limit the value or util- ity of the Mortqaqed Property. 3.03. Hazardous Substance.. Mortgagor shall not subsequent to the date of this Mortgage (a) cau.e, permit or .llow the depo.it or creation of eny Hazardous Substances (other than Permitted Substance.) at, on, ln or under the Mortgaged Property: (b) u.e, permit or allow the use of Hazardou. Substance. (other than Permitted Substances) .t, on, ln or under the Mortgaged Property: or (c) caus., penllt or .Uow the reI.... or threatened - 17 - - "fl'- ~ ,l't l v . . (14B release of any Hazardous Substances at, on, in, under or from the Mortgaged Property. 3.04. Dissolution: Chance of Business. Mortgagor shall not dissolve, merge or consolidate with any other person or sell, transfer or otherwise dispose of all or a substantial portion of its assets. Mortgagor shall continue to engage in its business substantially as currently conducted and operated and shall not engage in any other business. 3.05. Indebtedness. Subject to the provisions of Section 4.01(h) below, Mortgagor shall not at any time create, incur, assume or suffer to exist any debt of Mortgagor, except trade debt in an aggregate amount not to exceed $50,000. 3.06. Transfers. Mortgagor shall not at any time transfer title to the Mortgaged Property or any interest therein by sale, gift, lease, option, devise, operation of law or otherwise (except that Mortgagor shall be allowed to replace Equipment in the ordinary course of business). Mortgagor, if it is a partnership, shall not transfer any partnership interest, and if it is a corporation, shall not transfer any shares of stock, except a transfer to family members and at no time shall Mortgagor transfer more than 49\ of shares of stock in the aggregate to family members. ARTICLE IV EVENTS OF DEFAULT: ~DIES 4.01. Evants of Default. the occurrence or existence of events or conditions (whatever Default and whether voluntary, tion of law): (a) Mortgagor shall tail to pay when due prin- cipal ot the Note and such failure to pay shall have continued tor a period of ten (10) days atter written notice thereat to Mortgagor: provided, however, Mortgag.. shall not be required to give such written notice aore than once in any given twelve (12) month period or three (3) times during the tara ot this loan: or An Event of Detault shall mean one or more of the following the reason for such Event of involuntary or effected by opera- (b) Mortgagor shall tail to pay when due interest on the Note or any other ..ount due hereunder or under - 11 - i:-M'.' II I:' . t Ja9 the Note or any other Loan Document and such failure shall have continued for a period of ten (10) days after written notice thereof to Mortgagor: provided, however, Mortgagee shall not be required to give such written notice more than once in any given twelve (12) month period or three (3) times during the term of this loan; or (c) Any representation or warranty made by Mort- gagor or any Guarantor under this Mortgage or any other Loan Document or any statement made by Mortgagor or any Guarantor in any financial statement, certificate, report, exhibit or document furnished by Mortgagor or any Guarantor to Mortgagee pursuant to or in connection with this Mortgage or any other Loan Document shall prove to have been false or misleading in any material respect as of the time when made (including by omission of material information necessary to make such repre- sentation, warranty or statement not misleading); or (d) Mortgagor shall default in the performance or observance of any covenant contained in Sections 2.03, and such default shall have continued for a period of thirty (30) days after written notice therec~ to Mortgaqor, or 2.04, and such default shall have continued for a period of ten (10) days after written notice thereof to Mortgagor, or in Article III; or (e) Mortgaqor shall default in the performance or observance of any other covenant, agreement or duty under this Mortqaqe and such default shall have con- tinued for a period of thirty (30) days after written notice thereof to Mortqaqor; or (f) Mortgaqor or any Guarantor shall default in the performance or observance of any covenant, aqree- ment or duty under the Note or any other Loan Document beyond any period of qrace with respect thereto: or (q) An Event of Default set forth in any other Loan Oocument shall occur: or (h) One or more judCJlllents for the payment of money shall have been entered against Mortqagor or any Guarantor. Which judqaent or judqaents exceed $10,000 in the aqqreqate. and such judqaent or judqaents ahall - 19 - (;7" 1 ' ,. . J .J have remained undischarged, unstayed or unbonded for a period of thirty (30) consecutive days: or (i) A writ or warrant ot attachment, garnishment, execution, distraint or similar process shall have been issued against Mortgagor or any Guarantor which shall have remained undischarged and un stayed for a period of thirty (30) consecutive days: or (j) A proceeding shall have been instituted in respect ot Mortgagor or any Guarantor (i) seeking to have an order tor reliet entered in respect ot Mortgagor or any Guarantor, or seeking a declaration or entailing a tinding that Mortgagor or any Guarantor is insolvent or a similar declaration or finding, or seeking dis- solution, winding-up, charter revocation or for- feiture, liquidation, reorganization, arrangement, adjustment, composition or other similar relief with respect to Mortgagor or any Guarantor, its assets or its debts under any law relating to bankruptcy, insolvency, reliet of debtors or pro- tection ot creditors, termination ot legal enti- tie. or any other similar law now or hereatter in etfect, or (ii) seeking appointment ot a receiver, trustee, custodian, liquidator, assiqnee, .equestrator or other similar otticial tor Mort- gagor or any Guarantor or tor all or any substan- tial part ot its property, and such proceeding .hall result in the entry, making or grant ot any such order tor relief, declaration, finding, relief or appointment, or such proceeding shall remain undismissed and unstayed tor a period of forty-five (45) consecutive days: or (k) Mortgagor or any auarantor shall becoae inSOlvent. shall become generally unable to pay its debts a. they become due, shall voluntarily suspend transaction ot its business. shall make a general assiqnaent for the bene tit or creditors, shall insti- tute a proceeding described in Section 4.01(k)(i) or ahall consent to any such order tor relier. declara- tion. finding or relier described therein, shall lnati- - 20 - tute a proceeding described in Section 4.01(k)(ii) or shall consent to any such appointment or to the taking of possession by any such official of all or any sub- stantial part of its property whether or not any such proceeding is instituted, shall dissolve, wind-up or liquidate itself or any substantial part of its prop- erty, or shall take any action in furtherance of any of the foregoing: or (1) Failure of the Mortgagor to assign, transfer and deliver to Mortgagee a $50,000 Certificate of Deposit issued in the name of Keith L. Plasterer to be deposited by February 15, 1993, which Certificate of Deposit is to be held as collateral security for this Mortgage. (m> For the purposes of this Section 4.01, if any non monetary default iE not reasonably capable of being cured within the cure period specified for such default, it shall not be considered an Event of Default if Mortgagor commences to cure such default within the applicable cure period and diligently prosecutes same to completion. 4.02. Remedies. ea) PrimarY Remedies. If an Event of Default shall occur, Mortgagee may ex) by notice to Mortgagor, declare the Secured Obligations immediately due and payable without presentment, demand, protest or further notice of any kind, all of which are hereby expre..ly waived: provided, however, that, in the case of an Event of Default .pecified in .ubsections (k) or el) of Section 4.01, the Secured Obligations shall auto- matically become due and payable without presentment, demand, protest or notice of any kind, all of which are hereby expressly waived: and/or ey) exercise any other right, power or remedy available to it at law or in equity, hereunder or under any other Loan Document without demand, prote.t or further notice of any kind, all of which are hereby expre.sly waived, except such a. i. expre.sly required hereby or by such other Loan Document. Without limiting the generality of the fore- going, Mortgagee may: (i) enter and take po.....ion of the Mort- gaged Property or any part thereof, exclude Mort- gagor and all pereons claiming und.r Hortgagor Wholly or partly ther.from, and operate, us., - n- i.-:; , , ,. . hl manage and control the same, or cause the same to be operated by a person selected by Mortgagee, either in the name of Mortgagor or otherwise, and upon such entry, from time to time, at the expense of Mortgagor and of the Mortgaged Property, make all such repairs, replacements, alterations, additions or improvements thereto as Mortgagee may deem proper, and collect and receive the rents, revenues, issues, profits, royalties, income and benefits thereof and apply the same to the payment of all expenses which Mortgagee may be authorized to incur under the provisions of this Mortgage and applicable law, the remainder to be applied to the payment, performance and discharge of the Secured Obligations in such order as Mortgagee may deter- mine until the same have been paid in full; (ii) institute an action for the foreclosure of this Mortgage and the sale of the Mortgaged Property pursuant to the judgment or decree of a court of competent juriSdiction; (iii) sell the Mortgaged Property to the highest bidder or bidders at public auction at a .ale or sale. held at such place or places and time or times and upon .uch notice and otherwise in such manner as may be required by law, or in the ab.ence of any such requirement, as Mortgagee mar deem appropriate, and from time to time adjourn such aale by announcement at the time and place specified for .uch sale or for .uch adjourned .ale or sales without further notice except such as may be required by law; (iv) take all steps to protect and enforce the rights of Mortgagee under this Mortgage by .uit for specific performance of any covenant herein contained, or in aid of the execution of any power herein granted or for the .nforcement of any ather rights; and/or (v) ex.rcis. any or all of the rights and remedies available to a ..cured party und.r the tlCC, including the right to (A) enter the Mort- gaged Property and take po.....ion of the Equip- ..nt wi~hout demand or notice and without prior judicial hearing or legal Proceeding., which - 22 - "- ~ ".'J~ . " I \j 11 :i) Mortgagor hereby expressly waives, (D) require Mortgagor to assemble the Equipment, or any por- tion thereof, and make it available to Mortgagee at a place or places designated by Mortgagee and reasonably convenient to both parties and (C) sell all or any portion of the Equipment at public or private sale, without prior notice to Mortgagor except as otherwise required by law (and if notice is required by law, after ten days' prior written notice), at such place or places and at such time or times and in such manner and upon such terms, whether for cash or on credit, as Mortgagee in its sole discretion may determine. As to any property subject to Article 9 of the UCC included in the Mortgaged Property, Mortgagee may proceed under the uce or proceed as to both real and personal property in accordance with the provisions of this Mortgage and the rights and remedies that Mort- gagee may have at law or in equity, in respect of real property, and treat both the real and per- sonal property included in the Mortgaged Property as one parcel or package ot .ecurity. Mortgagor .hall have the burden of proving that any sale pursuant to this Section 4.02(a) or pursuant to the ace was conducted in a commercially unreason- able manner. (b) Receiver. In any action to foreclo.e this Mortgage, Mortgagee shall be entitled as a matter of right to the appointment of a receiver of the Mortgaged Property and the rents, revenu.s, issu.s, protits, royalties, income and benefits thereot, without notice or demand, and without regard to the adequacy of the ..curity for the Secured Obligations or the .olvency ot Mortgagor. (c) Environmental Site Assessments. If an Event of Default ahall occur, Mortgagor shall permit .uch p.rson. .. Mortgage. may designate ("Sit. Reviewers") to vi.it the Mortgaged Prop.rty and pertorm environ- mental .ite investigations and as......nt. ("Site A8..s.ments") on the Mortgaged Prop.rty for the purpose of determining whether there exists on the Mortgaged Property any environmental condition which could re.ult in any Liability, co.t or expen.e to the owner or occupier ot the Mortqaged Property. Such Site A.....- .ents may include both above and below the qround - 23 - testing for environmental damage or the presence of Hazardous Substances on the Mortgaged Property and such other tests on the Mortgaged Property as may be neces- sary to conduct the Site Assessments in the opinion of the Site Reviewers. Mortgagor will supply to the Site Reviewers such historical and operational information regarding the Mortgaged Property as may be reasonably requested by the Site Reviewers to facilitate the Site Assessments and will make available for meetings with the Site Reviewers appropriate personnel having knowledge of such matters. The cost of performing all Site Assessments shall be paid by Mortgagor within five days after demand by Mortgagee with interest at the Default Rate until paid. (d) Riaht of Set-Off. If an Event of Default shall occur, Mortgagee and the holder of any participa- tion in the Note shall have the right, in addition to all other rights and remedies available to it, to set-off against and to appropriate and apply to the unpaid balance of the Note and all other obligations of Mortgagor hereunder or under any other Loan Document any debt owing to, and any other funds held in any manner for the account of, Mortgagor by Mortgagee or such holder, including all funds in all deposit accounts (general or special) now or hereafter main- tained by Mortgagor with Mortgagee or such holder. Such right shall exist whether or not Mortgagee or any such holder shall have made any demand under the Note or any such participation or any other Loan Document and whether or not the Note or such participation or such other obligations are matured or unmatured. Mortgagor hereby confirms the foregoing arrangements and each such holder's and the Mortgagee's right Of banker's lien and set-off and nothing in this Mortgage or any other Loan Document shall be deemed any waiver or prohibition of any such holder'. or of the Mort- qaqee's right of banker's lien or set-otf. (e) Sales bY Parcels. In any sale aade under or by virtue of this Mortgage or pursuant to any judqment or decree of court, the Mortgaged Property aay be sold in one or more parts or parcels or as an entirety and in such order as Mortgagee may elect. without reqard to the riqht of Mortqagor, or any person claiaing under it, to the .arshalling of assets. - 24 - , ~'1 U~ (f) Effect of Sale. The purchaser at any sale made under or by virtue of this Mortgage or pursuant to any judgment or decree of court shall take title to the Mortgaged Property or the part thereof so sold free and discharged of the estate of Mortgagor therein, the purchaser being hereby discharged from all liability to see to the application of the purchase money. Any person, including Mortgagee, may purchase at any such sale. Mortgagee is hereby irrevocably appointed the attorney-in-fact of Mortgagor in its name and stead to make all appropriate transfers and deliveries of the Mortgaged Property or any portions thereof so sold and, for this purpose, Mortgagee may execute all appropriate instruments of transfer, and may substitute one or more persons with like power, Mortgagor hereby ratifying and confirming all that its said attorneys or such substi- tute or substitutes shall laWfully do by virtue hereof. Nevertheless, Mortgagor shall ratify and confirm, or cause to be ratified and confirmed, any such sale or sales by executing and delivering, or by causing to be executed and delivered, to Mortgagee or to such pur- chaser or purchasers all such instruments as may be advisable, in the judgment of Mortgagee, for the pur- pose, and as may be designated, in such request. Any sale or sales made under or by virtue of this Mortgage, to the extent not prohibited by law, shall operate to divest all the estate, right, title, interest, prop- erty, claim and demand whatsoever, whether at law or in equity, of Mortgagor in, to and under the Mortgaged Property, or any portions thereof so sold, and shall be a perpetual bar both at law and in equity against Mortgagor, its successors and assigns, and against any and all persons claiming or who may claim the same, or any part thereof, by, through or under Mortgagor, or its successors or assigns. The powers and agency herein granted are coupled with an interest and are irrevocable. (g) Eviction of Mortaaaor After Sale. If Mort- gagor faila or refuses to surrender ~saession of the Mortgaged Property after any sale thereof, Mortgagor shall be deemed. tenant at sufferance, subject to eviction by means of forcible entry and detainer pro- ceeding., provided that this remedy ia not exclusive or in deroqation of any other right or remedy available to Mortgagee or any purchaser of the Mortgaged Property - 25 - .~, t t .- -". " J;; under any provision of this Mortgage or pursuant to any judgment or decree of court. (h) Confession of Judament for Eiectment. For the purposes of the remedies afforded Mortgagee in Section 4.02(a), Mortgagor hereby authorizes any attor- ney of any court of record to appear for Mortgagor to sign an agreement ~or entering an amicable action of ejectment for possession of any of the Mortgaged Prop- erty and to confess judgpent thereon against Mortgagor in favor of Mortgagee, whereupon a writ may forthwith issue for the immediate possession of any of the Mort- gaged Property, without any prior writ or proceeding whatsoever: and for so doing, this Mortgage or a copy hereof verified by affidavit shall be a sufficient warrant. (i) Insurance Policies. In the event of a fore- closure sale pursuant to this Mortgage or other trans- fer of title or assignment of the Mortgaged Property in extinguishment, in whole or in part, of the Secured Obligations, all right, title and interest of Mortgagor in and to all policies of insurance required under the provisions of Section 2.04 shall inure to the benefit of and pass to the successor in interest of Mortgagor or the purchaser or grantee of the Mortgaged Property or any part thereof so transferred. 4.03. ADDlication ot Proceeds. The proceeds of any sale made either under the power of sale hereby given or under a judgment, order or decree made in any action to foreclose or to enforce this Mortgage, shall be applied: (a) first to the payment of (i) all costs and expense. of such .ale, including reasonable attorneys' fee., appraisers' fees and costs of procuring title searches, title insurance policies and similar items and (ii) all charges, expenses and advances incurred or made by Mortgagee in order to protect the lien or estate created by this Mortgage or the security afforded hereby including any expenses of entering, taking possession of and operating the Mortgaged Prop- erty: (b) then to the payment ~f any other Secured Obligations in such order a. Mortgagee may deteraine until the sa.. have been paid in full: and - 26 - ecl gagor, or to, or as any balance thereof shall be paid to Mort- to whosoever shall be legally entitled there- a court of competent jurisdiction may direct. 4.04. Riaht to Sue Without Preiudice. If an Event of Default shall occur, Mortgagee shall have the right trom time to time to cause a sale of the Mortgaged Property under the provi- sions of this Mortgage or to sue tor any sums required to be paid by Mortgagor under the terms of this Mortgage as the same respec- tively become due, without regard to whether or not the Secured obligations shall be due and without prejudice to the right ot Mortgagee thereatter to cause any such sale or to bring any action or proceeding ot toreclosure or otherwise, or to take other action, in respect of any Event of Default existing at the time such earlier action or proceeding was commenced. 4.05. Power to Moditv Documents. Mortgagee may at any time or from time to time renew or extend this Mortgage or any other Loan Document or amend or modify the same in any way, or waive any ot the terms, covenants or conditions hereof or thereof in whole or in part, and may release any portion of the Mortgaged Property or any other security, and grant such extensions and indulgences in relation to the Secured Obligations as Mortgagee may determine, without the consent of any junior lienor or encum- brancer and without any Obligation to give notice of any kind to any person and without in any manner atfecting the priority ot the lien or security interest of this Mortgage on or in any part of the Mortgaged Property. Mortgagee may at any time or trom time to time subordinate the lien or security interest of this Mortgage to any lease of space in the Improvements or any other agreement with respect to the occupancy or use of any part of the Mortgaged Property, or to any easement, restrictive covenant or other encumbrance on any part of the Mortgaged Property, or to any other lien on or .ecurity interest in any part ot the Mort- gaged Property, or to any other interest of any person in or to any part ot the Mortgaged Property, in each case without the agreement or consent of Mortgagor or of the tenant or other party holding the interest to which the lien or security interest hereof i. being subordinated or of any other person having a right or interest in any of the Mortgaged Property, without any obligation to give notice of any kind to any person, and without in any manner affecting (except to the extent specifically pro- vided in the instrument effecting such subordination) the pr.ior- ity of the lien or security intereBt of this Mortgage on or in any part of the Mortgaged Property. 4.06. Remedies CUmulative. - 21 - (al Generallv. No right or remedy herein con- ferred upon or reserved to Mortgagee is intended to be exclusive of any other right or remedy, and each and every such right and remedy shall be cumulative and in addition to any other right or remedy of Mortgagee under the Loan Documents or this Mortgage, or at law or in equity. The failure of Mortgagee to insist at any time upon the strict observance or performance of any of the provisions of this Mortgage, or to exercise any right or remedy provided for herein or in the Loan Documents, shall not impair any such right or remedy nor be construed as a waiver or relinquishment thereof. Every right and remedy given by this Mortgage or the Loan Documents to Mortgagee, or to which Mortgagee may otherwise be entitled, may be exercised from time to time and as often as may be deemed expedient by Mort- gagee, and no warrant shall be exhausted by the .xer- cise thereof. Mortgagee may pursue inconsistent remedies. (bl other Securitv. Mortgagee shall be .ntitled to .nforce paym.nt and performance of any S.cured Obligations and to .xercise all rights and pow.rs under the Loan Documents or this Mortgage, or at law or in .quity, notwithstanding that such S.cured Obligations lIaY now or her.aft.r b. otherwise secured. N.ither the acc.ptance of this Mortgage nor its enforcem.nt, wh.ther by court action or pursuant to the pow.r of sale or oth.r pow.rs herein contained, .hall prejudice or in any aann.r aff.ct Mortgag.... right to r.alize upon or .nforc. any other .ecurity now or h.r.after held by Mortgagee in such order and .anner as Mortgagee in its sol. discr.tion may d.termine. 4.01. Waiver of Stay. Extension. Moratorium Laws: !auitv of RedemDtion. Mortgagor .hall not at any time (al insist upon, plead or 1n any .ann.r whatev.r claim or take any ben.fit or advantage of any applicabl. pre..nt or tutur. stay, .xt.n.ion or moratorium Law or (bl claim, take or in.i.t upon any ben.fit or advantage of any pre.ent or future Law providing tor the valua- tion or appraisal of the Mortgaged Property prior to any .ale or sale. ther.ot which aay b. made under or by virtu. of the provi- 8ions ot S.ction ..02: and Mortgagor hereby waiv.. all bene tit or advantage ot any .uch Law or Law.. Mortgagor, tor it..lt and all who aay clai. under it, her.by waiv.. any and all right. and equiti.. ot rede.ption trea .al. under the power ot ..1. created h.reunder or troD sale under any order or d.cree ot foreclo.ure - n - ~ .. 1'1. . 1.J ot this Mortgage and all notice or notices ot seizure, and all right to have the Mortgaged Property marshalled upon any foreclo- sure hereot. Mortgagee shall not be obligated to pursue or exhaust its rights or remedies as against any part ot the Mort- gaged Property betore proceeding against any other part thereof and Mortgagor hereby waives any right or claim ot right to have Mortgagee proceed in any particular order. Mortgagor hereby waives and releases all procedural errors, detects and impertections in any proceedings instituted by Mortgagee under this Mortgage. ARTICLE V MISCELLANEOUS 5.01. Securitv and Priori~v ot Advances. (a) Loan Advances. This Mortgage secures, and the Secured Obligations include, tuture advances. All advances and indebtedness arising and accruing trom time to time under the Loan Documents shall be secured hereby to the same extent as though the Loan Documents were tully incorporated in this Mortgage. Onder the Loan Documents advances may be made and indebtedness may be incurred trom time to time hereatter, but each such advance or indebtedness shall be secured hereby as it made on the date hereot. Mortgagor hereby covenants and agrees that it will not exercise, and bereby waives, its rigbt under 42 Pa. Stat. 1814J(c) to limit the indebtedness secured by this Mortgage. (b) Other Advances. This Mortgage secures. and the Secured Obligations include, (i) all advances made by Mortgagee with respect to any ot the Mortgaged Property tor the payment ot Impositions, maintenance charqes, insurance premiums or costs incurred for the protection ot any of the Mortgaged Property or the lien ot this Mortgage, and (ii) all expense. incurred by Mortgagee by reason of an Event of Detault bereunder. 1.8 provided in 42 Pa. Stat. 18144, this Mortgage shall constitute a lien on the Mortgaged Property trea the time this Mortgage is left ot record (or, if this i. a purcha.e aoney aortgage, from the time ot delivery hereot to Mortgagee) for. a.onq other thinqs. all .uch advance. and .xpen.... plus interest th.reon. reqard- 1... ot the ti.. when such advanc.. ar. ad. or .uch .xpen..s are incurred. - 29 - · ..( 11 t _,; . J.oI 5.02. Chanaes in Tax Law. In the event ot the passage atter the date ot this Mortgage of any Law deducting trom the value of the Mortgaged Property, for the purpose of taxation, any lien thereon, or changing in any way the Laws now in force tor the taxation of mortgages, or debts secured thereby, for state or local purposes, or the manner of the operation of any such taxes so as to affect the interest of Mortgagee, then and in such event, Mortgagor shall bear and pay the tull amount of such taxes, provided that if for any reason payment by Mortgagor of any such new or additional taxes would be unlawful (including under the laws of usury) Mortgagee may either declare the whole sum secured by this Mortgage, with interest thereon, to be imme- diately due and payable, or pay that amount or portion of such taxes as would be unlawful to require Mortgagor to pay, in which event Mortgagor shall concurrently therewith pay the balance of said taxes. 5.03. Further Assurances. (a) Generallv. From time to time upon the request ot Mortgagee, Mortgagor shall, promptly and duly execute, acknowledge and deliver any and all such further instruments and documents as Mortgagee may reasonably deem necessary or desirable to confirm this Mortgage, to carry out the purpose and intent hereof, or to enable Mortgagee to entorce any of its rights hereunder. 5.04. Amendments. Waivers. Etc. This Mortgage cannot be amended, modified, waived, changed, discharged or terminated except by an instrument in writing signed by the party against whom enforcement of such amendment, modification, waiver, change, discharge or termination is sought. 5.05. No ImDlied Waiver. No course of dealing and no delay or tailure of Mortgagee in exercising any right, power or privilege under this Mortgage, the Note or any other Loan Docu- ment shall affect any other or future exercise thereot or exer- cise ot any other right, power or privilege: nor shall any single or partial exercise ot any such right, power or privilege or any abandonment or discontinuance ot steps to entorce such a right. power or priVilege preclude any turther exercise thereof or ot any other right, power or privilege. 5.06. Hotices. All notices, requesta, de.ands, directions and other communications (collectively -notice.-) under the provisions of thia Mortgage shall be in writlnq unless otherwise - 30 - ~ -. . . r . 'q '!. ~ expressly permitted hereunder or thereunder and shall be sent by first- class or first-class express mail, or by fax with con- firmation in writing mailed first-class, in all cases with charges prepaid, and any such properly given notice shall be effective when received. Any notice physically presented to the recipient shall be deemed received whether the recipient accepts or rejects the presentment. All notices shall be sent to the applicable party at its address stated on the first page hereof or in accordance with the last unrevoked written direction from such party to the other party hereto. 5.07. Excenses: Taxes: Attornevs' Fees. Mortgagor agrees to payor cause to be paid and to save Mortgagee harmless against liability for the payment of all reasonable out-of-pocket expenses, including fees and expenses of counsel for Mortgagee, incurred by Mortgagee from time to time (a) arising in connection with the preparation, execution, delivery and performance of this Mortgage, the Note and the other Loan Documents, subject nevertheless to the terms of Paragraph 3 of an Amendment to Purchase Agreement, dated December 30, 1992, between Mortgagor and Mortgagee, (b) relating to any requested amendments, waivers or consents to this Mortgage, the Note or any other Loan Document and (c) arising in connection with Mortgagee's enforcement or preservation of rights under this Mortgage, the Note or any other Loan Document, including such expenses as may be reasonably incurred by Mortgagee in the collection of the Note or the realization of security given for the Note. Mortgagor agrees to pay all stamp, document, transfer, recording or filing taxes or fees and similar impositions now or hereafter determined by Mortgagee to be payable in connection with this Mortgage, the Note or any other Loan Documents, and Mortgagor agrees to save Mortgagee harmless from and against any and all present or future claims, liabilities or losses with respect to or resulting from any omission by Mortgagor to payor delay in paying any such taxes, tees or impositions. Mortgagor agrees to pay and to save Mortgagee harmless against liability for the payment of all reasonable out-ot-pocket expenses incurred by Mortgagee in con- nection with its review of any repair, replacement, alteration, improvement or restoration to the Mortgaged Property in connection with the requirements of Sections 2.02, 2.03 and 2.06, includinq the reasonable tees and expenses of counsel tor Mortgagee and of any architect engaged by Mortgagee to review plans and specifications, inspect work or provide advice with respect to determinations to be made by Mortgagee in connection therewith. In the event of termination adversely to Mortgagor of any action at lav or suit 1n equity in relation to this Mortgage. the Note or any other Loan Document, Mortgagor viII pay, in - 11 - ,-. 1'1. . . , " ...; II r.'1 addition to all other sums which Mortgagor may be required to pay, a reasonable sum for attorneys' fees incurred by Mortgagee in connection with such action or suit. All amounts payable by Mortgagor under this Section 5.07 shall be paid within five days after demand by Mortgagee with interest at the Default Rate until paid. 5.08. Assianment of Leases. Concurrently herewith, Mort- gagor has executed and delivered to Mortgagee by separate instru- ment an Assignment of Leases and Rents dated as of the date hereof and to be recorded, pursuant to which Mortgagor has assigned to Mortgagee all of its right, title and interest in and to all leases of space in the Improvements, including all rents from such leases, all as therein more specifically set forth, which Assignment of Leases and Rents is incorporated herein by reference as fully and with the same effect as if set forth herein at length. S.09. Jurisdiction: Etc. Mortgagor irrevocably (a) agrees that Mortgagee, may bring suit, action or other legal proceedings arising out of this Mortgage (other than those brought for the foreclosure or other realization on the real property security granted hereby), the Note or any other Loan Document, or the transactions contemplated hereby or thereby, in the courts of the Commonwealth of Pennsylvania in CUmberland County, Pennsylvania or the courts of the United States for the Middle District of Pennsylvania: (b) consents to the jurisdiction of each such court in any such suit, action or proceeding: (c) waives any objection which Mortgagor may have to the laying of the venue of any such suit, action or proceeding in any of such courts: and (d) waives any right it may have to a jury trial in connection with any suit, action or proceeding arising out of this Mortgage, the Note or any other Loan Document or the transactions contemplated hereby or thereby. 5.10. Intercretation. Unless the context otherwise requires, (a) the term -person" means an individual, corporation, partnership, trust, unincorporated association, joint venture, joint-stock company, government (inClUding political sub- divisions), governmental authority or agency, or any other entity, (b) any reference in this Mortgage to -Mortgagor,- "Mortgagee" or any other entity shall include its successors and assigns, (c) any reference to an Article or Section shall refer to the specified Article or Section of this Mortgage, (d) words importing the singular number include the plural number, and vice versa, (e) the terms -hereot", "hereby-, "hereto-, "hereunder" and similar terms refer to this entire Mortgage, (t) the term - J~ - "including" shall mean "including without limitation", and any reference to the Mortgaged Property shall refer to the gaged Property or any part thereof or any estate or intere therein. The captions or headings at the beginning of eac Article and Section hereof are for the convenience of the and are not a part of this Mortgage. 5.11. Invaliditv of Certain Provisions. If the aecu interest, lien or estate created by this Mortgage is inval unenforceable as to any part of the Secured obligations, 0 any part of the Mortgaged Property, the unsecured or parti secured portion thereof shall be completely paid prior to payment of the remaining and sdcured or partially secured thereof, and all payments made thereon, whether voluntary pursuant to foreclosure sale or other enforcement action 0 procedure, shall be considered to bave been first paid on applied to the full payment of that portion thereof which secured or fully secured by this Mortgage. 5.12. Severabilitv. If any term or provision of thi Mortgage or the application thereof to any person or circu: shall to any extent be invalid or unenforceable, the remai. this Mortgage, or the application of such term or provisio: persons or circumstances other than those as to which it i: invalid or unenforceable, shall not be affected thereby, a: tera and provision of this Mortgage shall be valid and ent. able to the fullest extent permitted by law. 5.13. Governina Law. This Mortgage shall be governe, and construed in accordance with, the laws of the state in the Land is located. 5.14. Time ot ~8..nc.: Duration: Survival. Time 1s c essence with respect to all of Mortgagor's obligations undc Mortgage and the other Loan Documents. All representatiom warranties of Mortgagor contained herein or in any other Lc Document or made in connection herewith or therewith shall vive the aaking of and shall not be vaived by the executlor delivery of this Mortgage or the other Loan Documents, any inve.tigation by Mortgagee or the making ot any loan advanc under the Loan Docwaents. All covenants and agreements or gagor contained herein or in any other Loan Document shall continue in full force and ettect from and after the date h .0 long a. Mortgagor may borrow under the Loan Documents an until payaent in full of the Secured Obligation.. Without 11altation, it i. understood that all Obligation. ot Mortg~ - 3l - EXHIBIT "A" ALL THAT CERTAIN tract ot land situated in Upper Allen Township (except tor a small triangular piece in Lower Allen Township) cumberland County, Pennsylvania, bounded and described as tollows: BEGINNING at a nail in the center ot Wilson Road (T607) at corner ot land now or tormerly ot Georqe E. M. Wilson, Jr. and Nina M. Wilson: thence by the center ot Wilson Road, North 58 deqrees 30 minutes 47 seconds East, 438.93 teet to a railroad spike in the center ot said road: thence by land now or tormerly ot Romaine Sheely (passinq through an iron pin 30.0 teet trom the center ot said road) South 24 deqrees 45 minutes 00 seconds East, 753.46 teet to a tence post: thence by land now or tormerly ot Smith Land and Improv_ent Corp., South 55 deqrees 59 minutes 48 seconds West, 438.22 teet to an iron pin: thence by land now or tormerly ot Georqe E. M. Wilson, Jr. and Nina M. Wilson, North 25 deqrees 00 minutes 00 seconds West (passing throuqh an iron pin 30.0 teet trom the center ot Wilson Road) 772.45 teet to a nail, the place ot BEGINNING. CONTAINING 7.61 acre. and de.cribed according to a Plan ot Property tor Florence C. Hanning and John P. Hanning by Larson' Brilhart, Inc., dated June 16, 1970. BEING the sue pr_be. which P T Realty Co., by deed dated December 29, 1992 and recorded immediately prior hereto in the ottice ot the Recorder ot Deed. in and tor CUmberland County granted and conveyed unto ILP Enterprise., Inc. ........ "., " , . ''''." , : t ... \. ,--... .. t. /:' ;; ".' ";'~"''''1l\~ . ..,.-'~~.~"...... ;~..: , ; '.. ." ~ ..\.~ .. , " '." " .... .,lIr, . l ...- '-~\ ~."', ... .. a ,.' .. .. " , '-,.- .- ....--.... ""\ o .or__.... " . .....~nof' 1 SI ". ,'!.~ ....., t" ! f~4l'd\ftt of C. ,..;. ,'~ . ,nd ~ PI- I~' . -=::..-;~ liD .. ..... ..,t~~"'" .J& ... .,q" .....,. n . --1-..- ca-.oI ~ .. "",.~-<. ....,..,..... t!9~. . .. 'f" "",,-,.r . . ",. ',:' HQ1.E $3,800,000 January 29, 1993 Harrisburg, Pennsylvania FOR VALUE RECEIVED, KLP ENTERPRISES, INC., a Pennsylvania corporation ("Maker"), hereby promises to pay to the order ot FARMERS TRUST COMPANY, a Pennsylvania corporation ("Bank"), the principal sum ot Three Million Eight Hundred Thousand Dollars ($3,800,000), together with interest thereon, as tallows: 1. Definitions. Capitalized terms used herein which are not defined herein shall have the meanings assigned to them in the Mortgage or in the other Loan DOCUMents. (a) "Default Rate" meana a rate per annum equal to two percent (2') above the Loan Rate, or if auch rate violates any Law, the highest rate permitted by Law. (b) "Loan Rate" .eana the rate set torth in paragraph 2 below. 2. Interest Rates and PaYments. (a) Loan Rate: princiD41 and Interest PaYment Dates. (i) During the tirst thirty-six (36) months following the date hereof (the "First Period"), this Note shall bear interest at a fixed annual rate ot seven percent (7') on the unpaid principal amount ot the Loan (which rate shall be the "Loan Rate" during the First Period), and commencing on Karch 13, 1993, and on the first day of each of the next consecutive thirty-five (35) aonths, Maker shall pay to Bank monthly payments of prinCipal and interest, based upon a twenty (20) year amortization period, in the amount ot Twenty~Nine Thou.and Four Kundred Sixty-One Dollars and Thirty-Six Cents ($29,461.36). ( 11) On February 13, 1996 and on each sullsequent February 13 occurring during the term of this Note, the rate of inter.st ahall be revised to the then current Treasury Bill Index tor aaturities of six (6) aontha plus four hun- dred titty (450) "aia Points ("Revised Rate"). At no tiae shall the Revised Rate exceed ten percent (10'). The aonth~ ly payaent due hereunder ahall be recalculated to provide for amortization of the then remaining principal and interest at the Revised Rate 1n ~al aonthly pa,..nts tor I.cb the remaining portion of the original twenty (20) year amortization term. Bank shall have the right to adjust monthly payments more frequently than annually to avoid negative amortization. During the period described in this subsection (ii), the Revised Rate shall be the Loan Rate. (iii) Notwithstanding anything contained herein to the contrary, no interest shall be due hereunder from the date of this Note through February 12, 1993. (b) Default Rate. During the continuation of any default by Maker in the payment of principal of or interest on this Note, during the continuation of any Event of Default and/or after the maturity hereof (whether by acceleration or otherwise), both before and after judgment, the Loan shall bear interest at the Default Rate. (c) Calculations. Each interest rate hereunder shall be based on a year of 360 days and actual days elapsed. (d) Maturitv Date. Notwithstanding anything to the contrary contained in this Note or elsewh.re in the Loan Documents, unless extended by an agreement executed by Maker and Bank, this Note shall mature on February 13, 2013, without fUrther notice (the "Maturity Date"). On the Maturity Date the entire unpaid principal balance her.of, togeth.r with accrued interest thereon, and all oth.r .ums due and owing und.r the Loan Documents, shall become due and payable in full. (e) Preoavments. Mak.r .hall have the right at its option to prepay this Hote in whole at any time or in part from ti.e to time without premium or penalty. The Maker .hall notity the Bank in writinq at lea.t thirty (30) Cal.ndar Day. prior to the date such pr.payment will be paid and shall specify in .uch vritinq the a.ount to be prepaid. On the date .pecified for prepayment in the notice to the Bank, the principal amount of the Loan specified to be prepaid, toqather with all accrued but unpaid interest. t.... chaCge. and the applicable pr..ium (it any), shall be due and payable in their .ntirety. ]. Int..rast. Rat. R.iahurs__nt. It any Law or qtaideUM or interpretation or application thereot by any COYernaental Authority Charqed with the int.rpretation or adainistratlon - ~ . - , thereof or compliance with any request or directive of any Governmental Authority (whether or not havinq the force of law) now existinq or hereafter adopted subjects Bank to any tax or chanqes the basis of taxation with respect to this Note. Such amount shall be due and payable by Maker to Bank five (5) Busi- ness Days after such notice is qiven. 4. PaYments. All payments (includinq prepayments) to be made in respect of principal, interest or other amounts due from Maker hereunder or under any other Loan Document shall be payable by 12:00 Noon, Harrisburg time, on the day when due. Such pay- ments shall be made to Bank at its office at One West Hiqh Street, Carlisle, Pennsylvania 17013, in Dollars in funds immediately available at such office without set-off, counter- claim or other deduction of any nature. Any such payment received by Bank after 12:00 Noon, Harrisburg time, on any day shall be deemed to have been received on the next succeedinq Business Oay. Whenever any payment to be made under this Note or any other Loan Document shall be stated to be due on a day which is not a Business Day, auch payment shall be made on the next followinq Business Oay and such extension of time ahall be included in computinq interest, if any, in connection with such payment. To the extent permitted by law, after there shall have become due (by acceleration or otherwise) interest or any other amounts due from Maker hereunder or under any other Loan Docu- ment, such amounts ahall bear interest for each day until paid (before and atter judgment), payable on demand, at the Default Rate. 5. Late Charae. In the event that any installment of 1nterest, principal, principal and interest or other aua ahall become overdue tor a period in excess of fifteen (15) days, a "late charge" in the lUIOunt of 4\ of such overdue inatall_nt ahall b. paid by Kaker to Bank, which "late charge" ahall be payable on d...nd. Thi. charge .hall be 1n addition to, and not 1n 11eu Of, any other reaedy Bank ..y have and 1. 1n add1t10n to any reaaonable tee a and charges of any agents or attorneya which Bank i. entitled to ..ploy on any detault hereunder, whether authorized herein, or by law. 6. Default. If an Ivent ot Default shall occur lanlt _y Iccelerate the 1ndebtedneaa ev1denced hereby 1n Icco~nce with the prov1aion. of the Loan Doeuaent. and uy nen:1.. the other rlghu and rell8die. providM 1t 1n the Mortqaq. and th. other Loan Docuaent., a. vell a. tho.e it _y have at law or 1n equity. - ) - 7. Miscellaneous. This Note evidences the Loan and all other amounts payable by Maker hereunder or under any other Loan Document. This Note is the "Note" referred to in, and is entitled to the benefits of, the Mortgage, which among other things provide for the acceleration of the maturity hereof upon the occurrence of certain events and for prepayments in certain circumstances and upon certain terms and conditions. This Note is secured by and is entitled to the benefits of the Mortgage and the other Loan Documents. The unpaid principal amount of this Note, the unpaid interest accrued hereon, the interest rate or rates applicable to such unpaid principal amount and the duration of such appli- cability shall at all times be ascertained from the records of Bank, which shall be conclusive absent manifest error. Except as otherwise provided in the Loan Documents, Maker hereby expressly waives presentment, demand, notice, protest and all other demands and notices in connection with the delivery, acceptance, performance, default or entorcement of this Note, the Mortgage and the other Loan Documents, and an action for amounts due hereunder or thereunder shall immediately accrue. All notices, requests, demands, directions and other com- munications (collectively, "notices") under the provisions hereot shall be in writing unless otherwise expressly permitted here- under, shall be sent as provided in the Mortgage and shall be effective when received. If this Note is placed in the hands of an attorney at law tor collection by reason ot detault on the part ot Makar, Maker hereby agrees to pay to Bank in addition to the SUItS stated above, the reasonable costa ot collection, including a reasonable sua as attorneys' tees. This Note say not be amended. modified or supplemented orally. It any term or provision ot this Note or the application thereot to any Person or circumstance shall to Any extent be invalid or unenforceable. the remainder of this Note, or the application of such una or provision to Penons or clrcwutanc.. other than thoae a. to which it is i,walid or unenforceable. shall not be affected thereby, and .ach tana and provision of thLs Note ahall be valid and entoreeable to the fullest ext.nt penattted by law. .. . - This Note shall be governed by, and construed and enforced in accordance with, the laws of the Commonwealth of Pennsylvania. This obligation shall bind Maker and its successors and assigns, and the benefits hereof shall inure to Bank and its successors and assigns. Time is of the essence with respect to matters of perfor- mance required of Maker under this Note. UPON THE OCCURRENCE OF AN EVENT OF DEFAULT, MAKER HEREBY EMPOWERS ANY A'1"l'ORNEY OF ANY COURT OF RECORD WITHIN THE UNITED STATES OF AMERICA, OR ELSEWHERE, TO APPEAR FOR MAKER AND, WITH OR WITHOUT COMPLAINT FILED, CONFESS JUDGMENT, OR A SERIES OF JUDG- MENTS, AGAINST MAKER IN FAVOR OF ANY HOLDER HEREOF, AS OF ANY TERM, FOR THE UNPAID BALANCE OF THE PRINCIPAL AMOUNT OF THIS NOTE AND OTHER SUMS PAYABLE BY MAKER UNDER THE LOAN DOCUMENTS, TO- GETHER WITH UNPAID INTEREST ON SAID PRINCIPAL AMOUNT AND SAID OTHER SUMS AT THE RATE PROVIDED IN THIS NOTE, COSTS OF SUIT AND OTHER EXPENSES IN CONNECTION THEREWITH, TOGETHER WITH AN A'1"l'OR- NEYS' REASONABLE COMMISSION FOR COLLECTION, ON WHICH JUDGMENT OR JUDGMENTS ONE OR MORE EXECUTIONS MAY ISSUE FORTHWITH. MAKER HEREBY WAIVES ANY RIGHT IT MAY HAVE TO FURTHER NOTICE OR TO A HEARING IN CONNECTION WITH THE ENTRY OF ANY SUCH CONFESSION OF JUDGMENT AND STATES THAT IT HAS BEEN REPRESENTED BY COUNSEL. THE MAKER HEREBY 1QI0WINGLY WAIVES ITS RIGHT TO TRIAL BY JURY IN ANY ACTION BROUGHT BY OR ACAINST THE MAKER ON, MENTIONING, RELATED TO OR CONNECTED WITH THIS NOTE OR THE OTHER LOAN DOCU- MENTS. IN WITNESS WHEREOF, Maker ha. duly executed and delivered this Note a. of the date first above written. (COIlJ'Oll.ATE SIAL) - S - GUARANTY AND SURETYSHIP AGREEMENT THIS GUARANTY AND SURETYSHIP AGREEMENT (this "Guaranty") dated as of the 29th day of January, 1993, made by KEITH L. PLASTERER, an individual ("Guarantor") to FARMERS TRUST COMPANY, a Pennsylvania corporation ("Bank"), WIT N E SSE T H: WHEREAS, pursuant to a Note of even date herewith between KLP ENTERPRISES, INC., a Pennsylvania corporation ("Borrower"), and Bank (as the same may be amended, modified or supplemented from time to time, the "Note"), Bank has agreed to make a Loan of $3,800,000 to Borrower (capitalized terms used herein and not otherwise defined herein having the meanings assigned to them in the Note): WHEREAS, the Guarantor acknowledges receipt of copies of the Note and the other Loan Documents: and WHEREAS, the execution and delivery by Guarantor of this Guaranty is a condition to Bank's obligation to make the toan to Borrower pursuant to the Note, and Guarantor expects to derive financial benefit from the making of the Loan by Bank to Bor- rower: NOW, THEREFORE, in consideration of the premi.es and other good and valuable consideration, the receipt of which is hereby acknowledged by Guarantor, and intending to be legally bound, Guarantor hereby agre.s as follows: ARTICLE I GUARAH'I'n: 1.01. Guaranteed Obllaatlons. Guarantor hereby uncondi- tionally and irrevocably quaranteea to Bank and beeoaee surety to Bank for the due, punctual and full pa)"/lent and pertonlanu of, and covenants with Bank to duly. punctually and fully pay aM perform, the following (collectively, the .Cuarant-.d Cbliqa- tions") : ea) all indebtedne.. of Iorrover to hnlt evidenced by the Mot.e, both principal and intef1Hlt. and any reUna.ncinq or refumUnq of any thereof. and all other UlCNnta R. or to bee... ltlIe lInder the !tot. UId , ~"rIl r~ I' '. ~~ the other Loan Documents, and any refinancing or refunding of any thereof, whether now eXisting or hereafter arising, contracted or incurred: and Cb) all covenants, agreements, obligations and liabilities of Borrower under the Note and the other Loan Documents, whether now existing or hereafter arising, contracted or incurred, as and when such payment or performance shall become due Cwhether by acceleration or otherwise) in accordance with the terms of the Loan Documents. 1.02. Guarantee Unconditional. The obligations of Guarantor hereunder are continuing, absolute and unconditional, irrespective of any circumstance whatsoever which might otherwise constitute a legal or equitable discharge or defense of a guarantor or surety. Without limiting the generality of the foregoing, the obligations of Guarantor hereunder shall remain in full force and effect without regard to, and shall not be released, discharged or in any way affected by: Ca) any amendment, modification or supplement to the Note or any other Loan Document: (b) any exercise or nonexercise of or delay in exercising any right, remedy, power or privilege under or in respect of this Cuaranty, the Mortgage, the Note or any other Loan Document Ceven if any such right, remedy, power or privilege shall be loet thereby), or any waiver, consent, indulgence or other action or inaction in respect thereof: (C) any bankruptcy, insolvency, arrangeJllent, composition, a..ignment for the benefit of creditors or siailar proceeding comaenced by or against Borrower: (d) any failure to pertect or continue perfection of, or .ny reI.... or waiver at, any rights qiven to lank 1n any property a. security tor the pertoraanc. of any of tha Guaranteed Obligations: f.) any .xtenslon of tiae tor peyaant or pertor- ..ne. at any of the euaranteed Obligations: (t) the .,.nu1heneu. "aUcUty or enforceability o t the Loan Docwaeftta: . a . (g) any limitation of liability of Borrower or its partners contained in any Loan Document; (h) any defense that may arise by reason of the failure of Bank to file or enforce a claim against the estate of Borrower in any bankruptcy or other proceed- in91 (i) any voluntary or involuntary liquidation, dissolution, sale of all or substantially all of the property of Borrower, or any marshalling of assets and liabilities, or other similar proceeding affecting, Borrower or any of its assets; (j) the release of Borrower from performance or observance of any of the agreements, covenants, terms or conditions contained in the Loan Documents by opera- tion of law; (k) the failure of Bank to keep Guarantor advised of Borrower's financial condition, regardless of the existence of any duty to do so; (1) any part Property any sale or other transter ot the Property or thereof or any foreclosure by Bank on the or any part thereof; or (m) any other circumstances which might otherwise constitute a legal or equitable discharge at a quarantor or surety. No .et-otf, claim, reduction or diminution of any obligation, or any d.tens. of any kind or nature which Borrower or Guarantor now has or bereatter may have against Bank, shall be available hereunder to Guarantor against Bank. 1.0 J . No Notice or Dutv to hh*ust Relied i.. . 11uI Guarantor hereby waiv.. diligence, pre.entaent, demand, protest and ell notices ot any kind, and vaives any requireaent that Bank exhau.t any right or remedy, or proc-.d first or at any ti.., against Borrower or any other quarantor of, or any .ecurity for, any of the Guaranteed Obl1qation.. 1'b1e Guannty c:onetltut.. an aqne_nt of euretyahip a. well a. of quaranty, and Bank ..y pursue ita rights and reaedies under this Guaranty and under the other Loan Ooc\&aent. 1n whatever order, or collectively, and shall be entitltICI to payMnt and pertonance hreunder ft4rt- withstandift9 sueh oth... Loan Ooc\&aenta and notvlth8Undlft9 any . J - action taken by Bank or inaction by Bank to enforce any of its rights or remedies against any other guarantor or any other Person or property whatsoever. 1.04. WAIVER OF SUBROGATION. ETC. NOTWITHSTANDING ANY PAYMENTS MADE OR OBLIGATIONS PERFORMED BY GUARANTOR BY REASON OF THIS GUARANTY (INCLUDING BUT NOT LIMITED TO APPLICATION OF FUNDS ON ACCOUNT OF SUCH PAYMENTS OR OBLIGATIONS), UNTIL SUCH TIME AS THE GUARANTEED OBLIGATIONS HAVE BEEN SATISFIED THE GUARANTOR HEREBY IRREVOCABLY WAIVES AND RELEASES ANY AND ALL RIGHTS IT MAY HAVE AT ANY TIME (WHETHER ARISING DIRECTLY OR INDIRECTLY, BY OPERATION OF LAW, CONTRACT OR OTHERWISE) (A) TO ASSERT ANY CLAIM AGAINST BORROWER OR ANY OTHER PERSON, OR AGAINST ANY DIRECT OR INDIRECT SECURITY, ON ACCOUNT OF PAYMENTS MADE OR OBLIGATIONS PERFORMED UNDER OR PURSUANT TO THIS GUARANTY, INCLUDING WITHOUT LIMITATION ANY AND ALL RIGHTS OF SUBROGATION, REIMBURSEMENT, EXONERATION, CONTRIBUTION OR INDEMNITY, OR (B) TO REQUIRE THE MARSHALING OF ANY ASSETS OF BORROWER, WHICH RIGHT OF MARSHALING MIGHT OTHERWISE ARISE FROM PAYMENTS MADE OR OBLIGATIONS PERFORMED UNDER OR PURSUANT TO THIS GUARANTY, AND ANY AND ALL RIGHTS THAT WOULD RESULT IN SUCH GUARANTOR BEING DEEMED A "CREDITOR" UNDER THE UNITED STATES BANKRUPTCY CODE OF BORROWER OR ANY OTHER PER- SON. 1.05. CONFESSION OF JUDGMENT. (a) Upon an Event of Default, Guarantor hereby irre- vocably authorizes and empowers any attorney of any court of record in the Commonwealth of Pennsylvania or in any juris- diction where permitted by law, to appear for and confess judgment against Guarantor (i) in anyone or more actions of replevin instituted by Bank to obtain possession of any property of the Guarantor, without declaration or stay of execution, and with costs of suit, provided that notice of BUch appearance and confession of judgment is given promptly to Guarantor, and (il) in any action brought under this Guaranty or under any other Loan Document for any amounts due under the Guaranteed Obligations. and for costs of Buit and reasonable attorney's tees and costs, but in any event not Ie.. than $2,000, together with interest on any judgment so obtained at the Default Rate. including interest at that rate from and atter the date of any sheriff's or judicial sale until actual p4y=ent is made to Bank ot the tull asount due. Guarantor waive. and release. all its rights under any Btay, exemption, appraisement and appeal lava now or here- atter in ettect and all benefits that aay accrue to Guaran- tor by virtue ot any law or rule of court relating to a stay - ~ - of execution or exempting any property from levy or sale upon execution, and waives and releases all procedural errors in any such proceeding or judgment. If a copy of this Guaranty, verified by affidavit by or on behalf of Bank, shall have been filed in such action, it shall not be necessary to file the original as a warrant of attorney. The authority to appear for and enter judgment hereunder against Guarantor shall not be exhausted by the initial exercise thereof and may be exercised by Bank as often as Bank shall deem necessary or desirable, and this Guaranty, or a verified copy thereof, shall be a sufficient warrant. (b) IN GRANTING THIS WARRANT OF ATTORNEY TO CONFESS JUDGMENT, GUARANTOR HEREBY KNOWINGLY, INTEN- TIONALLY AND VOLUNTARILY, UNCONDITIONALLY WAIVES ANY AND ALL RIGHTS GUARANTOR HAS OR MAY HAVE TO PRIOR NOTICE AND AN OPPORTUNITY FOR A PRIOR HEARING UNDER THE RESPECTIVE CONSTITUTIONS AND LAWS OF THE UNITED STATES AND THE COMMONWEALTH OF PENNSYLVANIA. IN NEGOTIATING AND EXECUTING THIS GUARANTY, GUARANTOR HAS BEEN REPRESENTED BY COUNSEL OF ITS OWN CHOOSING. ARTICLE II REPRESENTATIONS. WARRANTIES AND COVENANTS 2.01. Reoresentations and Warranties. The Guarantor hereby represents, warrants and certifies to Bank that the repre- sentations and warranties aade by Borrower with respect to such Guarantor under the Note are true and correct on the date hereof. 2.02. that: Covenants. The Guarantor hereby covenants to Bank (a) Such Guarantor shall furnish to Bank the financial atat..ent., certificate. and other informa- tion with respect to such Guarantor required by Section 2. Of of the Mortqaqe. (b) Promptly upon becOIllnq aware thereof, such Guarantor ahall qive Bank notice of (i) the co.aence- ..nt. exiatence or threat ot any proceedinq by Or betore any Governaental Authority a9a1nat or atfectin; .uch Cuarantor or any of it. Subaidiari.. which, if advers.ly decided. would bay. a Mtnial adverse dfect Oft the bt.lalna... operations. ccndlt10n (financial or . !i - otherwise) or prospects of such Guarantor or on its ability to perform its obligations hereunder or (ii) any material adverse change in the business, opera- tions, condition (financial or otherwise) or prospects of such Guarantor. (c) Such Guarantor shall permit such Persons as Bank may designate to examine such Guarantor's books and records relating to such Guarantor's financial condition and take copies and extracts therefrom at normal business hours upon reasonable notice and to discuss the affairs of such Guarantor with its indepen- dent accountants at such times and as otten as Bank may reasonably request. Such Guarantor hereby authorizes such independent accountants to discuss with Bank the affairs of such Guarantor. ARTICLE III MISCEJ.T .AN1"OUS 3.01. Effect Of BankruDtcv Proceedinas. This Guaranty shall continue to be effective, or be automatically reinstated, as the case may be, if at any time payment, in whole or in part, of any of the Guaranteed Obligations is rescinded or aust other- wise be restored or returned by Bank as a preference, fraudulent conveyance or otherwise under any bankruptcy, insolvency or similar Law, all a. though such payment had not been made. If an Event of Default at any time ahall have occurred and be continu- ing or exist and declaration of default or acceleration under or wi th respect to any of the Loan DoCWllenta shall at auch ti.. be prevented by reaaon of the pendency against Borrower of a ca.. or proceeding under any bankruptcy or insolvency Law, Guarantor agree. that, for purposes ot this Guaranty and bia obligations hereunder, auch Loan Docuaents ahall be deemed to have been declared in default or accelerated with the same effect a. it such Loan Docuaents had been declared in default and accelerated 1n accordance with the tera. thereot, and Guarantor shall forth- with pay the Guaranteed Obligations in tull without turther notice or deaand. 3.02. Ran..lr'. Rillht ot ,.t-ort. It an lVent ot Detault ~11 OCCUr, 88M and the bolder of anI partic:llNltion ift the Loan Docueent.a shall baVe the r1qbt, In add Uon to aU oUer riQbta and nta1ldl" avaUable to lt, to .et-otf aqalMt and to appropriata and apply t.o the unpaid balance of the Chlannt.... - I - Obligations any debt owing to, and any other funds held in any manner for the account of, Guarantor by Bank or such holder, including without limitation all funds in all deposit accounts (general or special) now or hereafter maintained by Guarantor with Bank or such holder. Such right shall exist whether or not Bank or any such holder shall have made any demand under this Guaranty or any such participation or any other Loan Document and whether or not the Guaranteed Obligations or such participation are matured or unmatured. Guarantor hereby confirms the fore- going arrangements and each such holder's and the Bank's right of banker's lien and set-off and nothing in this Guaranty or any other Loan Document shall be deemed any waiver or prohibition of any such holder's or of Bank's right of banker's lien or set-off. 3.03. Further Assurances. From time to time upon the request of Bank, Guarantor shall promptly and duly execute, acknowledge and deliver any and all such further instruments and documents as Bank may reasonably deem necessary or desirable to confirm this Guaranty, to carry out the purpose and intent hereof or to enable Bank to enforce any of its rights hereunder. 3.04. Amendments. Waivers. Etc. This Guaranty cannot be amended, modified, waived, changed, discharged or terminated except by an instrument in writing signed by the party against whom enforcement of such amendment, modification, waiver, change, discharge or termination is sought. 3.05. No Imnlied Waiver: cumulative Remedies. No course of dealing and no delay or failure of Bank in exercising any right, power or priVilege under this Guaranty or any other Loan Document ahall affect any other or future exercise thereof or exercise of any other right, power or priVilege; nor shall any single or partial exercise of any such right, power or privilege or any abandonment or discontinuance of steps to enforce such a right, power or privilege preclude any further exercise thereof or of any other right, power or privilege. The rights and remedies of Bank under this Guaranty are cumulative and not exclusive of any rights or remedies which Bank would otherwise have under the other Loan Documents, at law or in equity. 3.06. Notices. All notices, requests, demands, direc- tions and other communications (COllectively "notices") under the provisions of this Guaranty .hall be in writing unl..s otherwise expre.sly permitted hereunder and shall be .ent by first-cla.s or firat-cla.. expres. aail, or by fax with confirmation in writing aalled firat-cla.., in all cases with charge. prepaid, and any such properly given notice shall be etfective Vben received. All - 1 - notices shall be sent to the applicable party addressed, if to Bank, One West High street, Carlisle, PA 17013, Attention: Lynn S. Baker, Executive Vice President, and, if to any Guarantor, at the address for Guarantor set forth below its signature hereto, or in accordance with the last unrevoked written direction from such party to the other parties hereto. 3.07. Excenses. Guarantor agrees to payor cause to be paid and to save Bank harmless against liability for the payment of all reasonable out-of-pocket expenses, including fees and expenses of counsel for Bank, incurred by Bank from time to time arising in connection with Bank's enforcement or preservation of rights under this Guaranty, including but not limited to such expenses as may be incurred by Bank in connection with any default by Guarantor of any obligations hereunder. 3.08. Survival. All obligations of Guarantor to make payments under Sections 3.01 or 3.07 hereof or to indemnify Bank (including indemnities by Borrower of Bank under the Loan Docu- ments) shall survive the payment and performance in full of the Guaranteed Obligations. 3.09. Jurisdiction: Etc. Guarantor irrevocably (a) agrees that Bank may bring suit, action or other legal proceed- ings arising out of this Guaranty in the courts of the Common- wealth of Pennsylvania in CUmberland County, Pennsylvania or the courts of the United States for the Middle District of Pennsyl- vania: (b) consents to the jurisdiction of each such court in any such suit, action or proceeding; and (c) waives any obje=tion which Guarantor may have to the laying of the venue of any such suit, action or proceeding in any of such courts: and (d) waives any right Guarantor may have to a jury trial in connection with any such suit, action or proceeding. 3.10. Severabilitv. If any term or provision of this Guaranty or the application thereof to any person or circumstance shall to any extent be invalid or unenforceable, the remainder of this Guaranty, or the application of such term or provision to persona or circumstances other than those as to which it is invalid or unenforceable, shall not be affected thereby, and each term and provision of this Cuaranty ahall be valid and enforce- able to the fullest extent permitted by law. 3.11. COuntemarts. This Guaranty may be executed in any number of counterparts and by the difterent partie. hereto on ..parate counterparts. each of WhiCh. when so executed, ahall be de..ed .n original, but .11 such counterparta ahall constitut. but one .nd the .... instrument. - . - ! I ,1 j i I . :.. .. , I . COJOlONlfUL'l'II or PIHHIYZ.VAHU , , 'II' COUHn or CuM.dud , On thll, the ~ daV ot DecIMblr, 1'12, biter. .., I Notary ~llc, the undlrllvnld oftlc.r, plrlon.lly applared Ir.dl.,. Iv.rl, .od .., L. Voit. "'ho aolcnllWlldVld _'Ilt to 1:11 tha ~'cf!rv~ WL'l'Y CO., . oorporltlon, and that ---- ., luoh oftlo.r, b.lnv ,uthorl.ad to do 10, I.aoutld the torltolng In.tzu.ant tar tha PUrpoa. thlraln contalnld by I1vnlng the na.. ot the OOrpar.tlcn by ___''It a. aucb Officer. XU wrrHlIS NHllIOr, X have h.r.unto 'at -V h'nd and otflolal ...1. m"..4''''L,J_, .....lliII~c:a...... ja ..... 1- ....... .. ~.1"-'J A"".'t.S,,' fI!' ...... , z....., '- C.llooo w..... ........ II U /I. t All ffl c...... Ca..... Jll....~~~. .... o.:-.~...~-- ...... .. ..... '- c:.. .....ClII...... . rUle.. L. Droit ~r.A j ~ Notary PIIb 0 ICy 0-111101\ Ilrph.... ........r n. .,,, '-.... J u~~*"tNllo ",. . .......~ ('IAt.) ~tJlt906 . . f \ . I" . I' . ... . --... .... -......---. . CERTJPICATION OF AQDRESI I h.~.by c.~tlfy that the p~.cl.. bu.ln... .dd~... of the Crant.. h.r.ln la: 1101 Lt..... Court A,anunt 104 Hicbaalc.~r.. 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