Preview of our top selling Construction Line of Credit Agreement
Cost Plus - Credit Line And Construction Deed of Trust
Exhibit 10.1.3
Prepared by:
Anthony M. Thiel, Esquire,
Tax Map Nos.
54-01-086H3
Willcox & Savage, P.C.,
54-01-086H4
1800 Bank of America Center,
54-01-086H
Norfolk, VA 23510
RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
Bank of America, N.A.
315 Montgomery Street, 13
th Floor
CA5-704-13-11
San Francisco, California 94104 Attn.: Ronald Drobny
CREDIT LINE AND CONSTRUCTION
DEED OF TRUST,
ASSIGNMENT OF RENTS AND LEASES,
SECURITY AGREEMENT AND
FIXTURE FILING
THIS IS A CREDIT LINE DEED OF TRUST
The maximum aggregate amount of principal to be secured at any one time under this Credit Line
Deed of Trust is $40,000,000.00.
Name of the noteholder secured by this Deed of Trust:
Bank of America, N.A. Address at which communications to the noteholder may be mailed or delivered:
Bank of America, N.A.
315 Montgomery Street, 13
th Floor
CA5-704-13-11
San Francisco, California 94104
ATTN: Ronald Drobny
This Document Serves as a Fixture Filing Under Va. Code Section 8.9A-502(c).
Borrower' s Organizational Identification Number: 94-1067973
Street Address of Property:
12300 Dominion Way
Windsor, Virginia 23487-5250
This Credit Line and Construction Deed of Trust, Assignment of Rents and Leases, Security Agreement and Fixture Filing (this " Deed of Trust" ) is made as of May 14, 2004, by COST PLUS, INC., a California corporation (" Borrower" ), as trustor, to PRLAP, INC, TRUSTEE, a Virginia corporation (" Trustee" ), as trustee having an address of 1400 Best Plaza, P.O. Box 26865, Richmond, Virginia 23227, for the benefit of BANK OF AMERICA, N.A., a national banking association (" Lender" ), as beneficiary having an address of 315 Montgomery Street, 13
th Floor, CA5-704-13-11, San Francisco, California 94104. Trustee is an affiliate of Lender. The addresses for Borrower, Lender and Trustee are also set forth at the end of this Deed of Trust. The Borrower is a Borrower for purposes of indexing and the Trustee and Lender are grantees for purposes of indexing.
ARTICLE 1.
Definitions; Granting Clauses; Secured Indebtedness; Credit Line and
Construction Deed of Trust
Section 1.1 Principal Secured . This Deed of Trust secures the aggregate principal amount of Forty Million Dollars ($40,000,000.00) plus such additional amounts as Lender may from time to time advance pursuant to the terms and conditions of this Deed of Trust and not met by Borrower, with respect to an obligation secured by a lien or encumbrance prior to the lien of this Deed of Trust or for the protection of the lien of this Deed of Trust, together with interest thereon.
Section 1.2 Definitions .
(a) In addition to other terms defined herein, each of the following terms shall have the meaning assigned to it, such definitions to be applicable equally to the singular and the plural forms of such terms and to all genders:
" Borrower" : Unless the context clearly indicates otherwise, the Borrower(s) named in the introductory paragraph hereof, together with all heirs, devisees, representatives, successors and assigns of such Borrower(s) pursuant to Section 6.21 below, or any of them.
" Casualty" : As that term is defined in the Loan Agreement.
" Claim" : Any controversy or claim between Borrower and Holder, whether arising in contract or tort or by statute, that arises out of or relates to (i) this Deed of Trust (including any renewals, extensions or modifications hereof), or (ii) any of the other Loan Documents.
" Collateral" : All of the Property constituting personal property or fixtures in which Borrower is granting Lender a security interest under this Deed of Trust, together with all proceeds and products thereof and all supporting obligations ancillary thereto or arising in any way in connection therewith.
" Commercial Real Estate Loan" : The loan evidenced by the Commercial Real Estate Loan Note.
" Condemnation" : As that term is defined in the Loan Agreement.
" Commercial Real Estate Loan Note" : The promissory note of even date herewith made by Borrower and payable to the order of Lender in the face principal amount of $20,000,000.00 bearing interest as therein provided which has a maturity date of June 1, 2014.
" Debtor Relief Law" : Any federal, state or local law, domestic or foreign, as now or hereafter in effect relating to bankruptcy, insolvency, liquidation, receivership, assignment for the benefit of creditors, reorganization, arrangement, composition, extension or adjustment of debts, or any similar law affecting the rights of creditors.
" Default" or " Event of Default" : Any of the events described in Section 4.1 of this Deed of Trust.
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" Environmental Agreement" : The Environmental Indemnity Agreement dated of even date herewith executed by Borrower in favor of Lender and certain other parties. The Environmental Agreement is not a Loan Document.
" Holder" : Lender or the subsequent holder at the time in question of the Note or any of the Secured Indebtedness.
" Indemnified Matters" : Any and all claims, demands, liabilities (including strict liability), losses, damages (including consequential damages), causes of action, judgments, penalties, fines, costs and expenses (including reasonable fees and expenses of attorneys and other professional consultants and experts, and of the investigation and defense of any claim, whether or not such claim is ultimately defeated, and the settlement of any claim or judgment including all value paid or given in settlement) of every kind, known or unknown, foreseeable or unforeseeable, which may be imposed upon, asserted against or incurred or paid by any Indemnified Party at any time and from time to time, whenever imposed, asserted or incurred, because of, resulting from, in connection with, or arising out of any transaction, act, omission, event or circumstance in any way connected with the Property or with this Deed of Trust or any other Loan Document, including any bodily injury or death or property damage occurring in or upon or in the vicinity of the Property through any cause whatsoever at any time, any act performed or omitted to be performed hereunder or under any other Loan Document, any breach by Borrower of any representation, warranty, covenant, agreement or condition contained in this Deed of Trust or in any other Loan Document, any Default, or any claim under or with respect to any Lease.
" Indemnified Party" : Each of the following persons and entities: (i) Lender and any Holder; (ii) Trustee; (iii) any persons or entities owned or controlled by, owning or controlling, or under common control or affiliated with, Lender, Holder and/or Trustee; (iv) any participants and co-lenders in the Loan; (v) the directors, officers, partners, employees, attorneys, agents and representatives of each of the foregoing persons and entities; and (vi) the heirs, personal representatives, successors and assigns of each of the foregoing persons and entities.
" Law" : Any federal, state or local law, statute, ordinance, code, rule, regulation, license, permit, authorization, decision, order, injunction or decree, domestic or foreign.
" Lease" : Each existing or future lease, sublease (to the extent of Borrower' s rights thereunder) or other agreement under the terms of which any person has or acquires any right to occupy or use the Property or any part thereof or interest therein, and each existing or future guaranty of payment or performance thereunder, and any and all existing or future security therefor and letter-of-credit rights with respect thereto, whether or not the letter of credit is evidenced by a writing..
" Legal Requirement" : Any law, agreement, covenant, restriction, easement or condition (including, without limitation of the foregoing, any condition or requirement imposed by any insurance or surety company), as any of the same now exists or may be changed or amended or come into effect in the future.
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" Lender" : As defined in the introductory paragraph of this Deed of Trust.
" Loan" : The Commercial Real Estate Loan and the Revolving Loan.
" Loan Agreement" : The Loan Agreement dated of even date herewith evidencing and governing the Loan, executed by and between Borrower and Lender, as it may from time to time be amended, modified, restated, replaced or supplemented.
" Loan Documents" : The Note, this Deed of Trust, and any other document now or hereafter evidencing, governing, securing or otherwise executed in connection with the Loan, including the Loan Agreement and any letter of credit or reimbursement agreement, tri-party financing agreement, guaranty executed by a third party, Swap Transaction or other agreement between Borrower and Lender and any other party or parties, pertaining to the repayment or use of the Loan proceeds, as such documents or any of them may have been or may be from time to time renewed, extended, supplemented, increased or modified; provided, however, that the Loan Documents do not include the Environmental Agreement.
" Note" : (i) The Commercial Real Estate Loan Note (ii) the Revolving Loan Note and (iii) all other promissory notes given in substitution thereof or in modification, supplement, increase, renewal or extension thereof, in whole or in part, whether one or more, as any or all of such promissory notes may from time to time be renewed, extended, supplemented, increased or modified.
" Permitted Encumbrances" : (i) Any matters set forth in any policy of mortgagee title insurance issued to Lender which are acceptable to Lender as of the date hereof, (ii) the liens and security interests evidenced by this Deed of Trust, (iii) statutory liens for real estate taxes and assessments on the Property which are not yet delinquent, (iv) other liens and security interests (if any) in favor of Lender, (v) the rights of tenants in possession as of the date hereof, if any, pursuant to Leases approved by Lender and the rights of future tenants under any Leases made in accordance with the Loan Documents, and the assignment of such Leases pursuant to this Deed of Trust, and (vi) any matters arising after the date hereof which may be acceptable to Lender or any Holder in its sole and absolute discretion, which Permitted Encumbrances in the aggregate do not materially adversely affect the value or use of the Property or Borrower' s ability to repay the Secured Indebtedness.
" Rents" : All of the rents, revenue, accounts, deposit accounts, payment intangibles, income, profits and proceeds derived from any Lease, including the proceeds from any negotiated lease termination or buyout of such Lease, liquidated damages following default under any such Lease, all proceeds payable under any policy of insurance covering loss of rents resulting from untenantability caused by damage to any part of the Property, all of Borrower' s rights to recover monetary amounts from any tenant in bankruptcy, including rights of recovery for use and occupancy and damage claims arising out of Lease defaults, including rejections, under any applicable Debtor Relief Law, together with any sums of money that may now or at any time hereafter be or become due and payable to Borrower by virtue of any and all royalties, overriding royalties, bonuses, delay rentals and any other amount of any kind or character arising under any and all present and future oil, gas, mineral and mining leases covering the Property or any part thereof, and all proceeds and other amounts paid or owing to Borrower under or pursuant to any and all contracts and bonds relating to the construction or renovation of the Property.
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" Revolving Loan" : The loan evidenced by the Revolving Loan Note.
" Revolving Loan Note" : The promissory note of even date herewith made by Borrower and payable to the order of Lender in the face principal amount of $20,000,000.00 bearing interest as therein provided which has a maturity date of November 14, 2005, unless extended in accordance with its terms and the terms of the Loan Agreement.
" Secured Indebtedness" : The following promissory notes, obligations, indebtedness, duties and liabilities and all renewals, extensions, supplements, increases and modifications thereof and thereto, in whole or in part, from time to time:
(i) The Note;
(ii) All indebtedness, liabilities, duties, covenants, promises and other obligations owed by Borrower to Lender now or hereafter incurred or arising pursuant to or permitted by the Loan Documents, expressly excluding, however, the Environmental Agreement (which is not a Loan Document) and also excluding any guaranty executed by a third party, whether now existing or hereafter arising, and whether joint or several, direct or indirect, primary or secondary, fixed or contingent, liquidated or unliquidated, and the cost of collection of all such amounts;
(iii) All indebtedness, liabilities, duties, covenants, promises and other obligations owed by Borrower (or its affiliates) to Lender (or its affiliates) under any Swap Transaction if and only if the Swap Transaction is evidenced by a writing reciting that it is secured by this Deed of Trust;
(iv) All amounts that Lender may from time to time advance pursuant to the terms and conditions of this Deed of Trust with respect to an obligation secured by a lien or encumbrance prior to the lien of this Deed of Trust or for the protection of this Deed of Trust, together with interest thereon; and
(v) If and only if evidenced by a writing reciting that it is secured by this Deed of Trust, any other loan, future advance, debt, obligation or liability owed by Borrower of every kind or character, whether now existing or hereafter arising, whether joint or several, direct or indirect, primary or secondary, fixed or contingent, liquidated or unliquidated, and the cost of collection of all such amounts, and whether or not originally payable to Lender or any other Holder, it being contemplated that Borrower may hereafter become indebted to Lender or another Holder for one or more of such further loans, future advances, debts, obligations and liabilities.
" Swap Transaction" means any agreement, whether or not in writing, relating to any transaction that is a rate swap, basis swap, forward rate transaction, commodity swap, commodity option, equity or equity index swap or option, bond, note or bill option, interest rate option, forward foreign exchange transaction, cap, collar or floor transaction, currency swap, cross-currency rate swap, swap option, currency option or any other similar transaction (including any option to enter into any of the foregoing) or any combination of the foregoing, and, unless the context otherwise clearly requires, any form of master agreement (the " Master Agreement" )
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published by the International Swaps and Derivatives Association, Inc., or any other master agreement, entered into between Lender (or its affiliates) and Borrower (or its affiliates) in connection with the Loan (and secured by this Deed of Trust), together with any related schedules, as amended, supplemented, superseded or replaced from time to time, relating to or governing any or all of the foregoing.
" Transfer" : Any sale, lease, conveyance, assignment, pledge, encumbrance or transfer, whether voluntary, involuntary, by operation of law or otherwise.
" Trustee" : The trustee identified in the introductory paragraph of this Deed of Trust, and any successor or substitute appointed and designated as herein provided, from time to time acting hereunder.
(b) Any term used or defined in the Virginia Uniform Commercial Code, as in effect from time to time, which is not defined in this Deed of Trust has the meaning given to that term in the Virginia Uniform Commercial Code, as in effect from time to time, when used in this Deed of Trust. However, if a term is defined in Title 8.9A of the Virginia Uniform Commercial Code differently than in another Title of the Virginia Uniform Commercial Code, the term has the meaning specified in Title 8.9A.
Section 1.3 Granting Clause . In consideration of the provisions of this Deed of Trust and of the sum of Ten Dollars ($10.00) cash in hand paid and other good and valuable consideration and for other good and valuable consideration, the receipt and sufficiency of which are acknowledged by Borrower, to secure the obligations of Borrower under the Loan Documents and all other matters and indebtedness constituting the Secured Indebtedness, Borrower hereby GRANTS, CONVEYS, TRANSFERS and ASSIGNS to Trustee, with general warranty and English covenants of title, in trust for the benefit of Lender, with power of sale and right of entry and possession, all estate, right, title and interest which Borrower now has or may hereafter acquire in and to the following Premises, Accessories and other rights, interests and properties, and all rights, estates, powers and privileges appurtenant thereto (collectively, the " Property" ):
(a) The real property described in Exhibit A which is attached hereto and incorporated herein by reference (the " Land" ), together with: (i) any and all buildings, structures, improvements, alterations or appurtenances now or hereafter situated or to be situated on the Land (collectively, the " Improvements" ); and (ii) all right, title and interest of Borrower, now owned or hereafter acquired, in and to (A) all streets, roads, alleys, easements, rights-of-way, licenses, rights of ingress and egress and vehicle parking rights, existing or proposed, abutting, adjacent, used in connection with or pertaining to the Land or the Improvements; (B) any strips or gores between the Land and abutting or adjacent properties; (C) all options to purchase the Land or the Improvements or any portion thereof or interest therein, and any greater estate in the Land or the Improvements; (D) all water, water rights (whether riparian, appropriative or otherwise, and whether or not appurtenant) and water stock, timber, crops and mineral interests on or pertaining to the Land; and (E) all development rights and credits and air rights (the Land, Improvements and other rights, titles and interests referred to in this clause (a) being herein sometimes collectively called the " Premises" );
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(b) All fixtures, equipment, systems, machinery and building and construction supplies and materials, of every kind and character, tangible and intangible (including software embedded therein), now owned or hereafter acquired by Borrower, which are now or hereafter affixed to the Land or the Improvements, and are necessary to the complete and proper planning and development or operation thereof, or are acquired (whether delivered to the Land or stored elsewhere) for installation in or on the Land or the Improvements, and all renewals and replacements of, substitutions for and additions to the foregoing (the properties referred to in this clause (b) being herein sometimes collectively called the " Accessories," all of which are hereby declared to be permanent accessions to the Land);
(c) All (i) plans and specifications for the Improvements, (ii) Borrower' s rights, but not liability for any breach by Borrower, under all property insurance policies regarding the Premises or the Accessories (or additional or supplemental coverage related thereto, including from an insurance provider meeting the requirements of the Loan Documents or from or through any state or federal government-sponsored program or entity), Swap Transactions, contracts and agreements for the design, construction, operation or inspection of the Improvements, (iii) all rights to the payment of money from Lender under any Swap Transaction, (iv) Borrower' s rights in tenants' security deposits, deposits with respect to utility services to the Premises, and any deposits or reserves hereunder or under any other Loan Documents for taxes, insurance or otherwise), (v) rebates or refunds of impact fees or other taxes, assessments or charges related to the Premises or the Accessories, (vi) permits, licenses, franchises, certificates, development rights, commitments and rights for utilities, obtained in connection with the Premises or the Accessories, (vii) Leases and Rents of the Premises and the Accessories (without derogation of Article 3 hereof), and (viii) as extracted collateral produced from or allocated to the Land, including oil, gas and other hydrocarbons and other minerals and all products processed or obtained from such as-extracted collateral and the proceeds thereof;
(d) All (i) proceeds (whether cash or non-cash and including payment intangibles) arising from any sale, lease or other disposition of the properties, rights, titles and interests referred to above in this Section 1.3, proceeds of each policy of property insurance, present and future (or additional or supplemental coverage related thereto, including from an insurance provider meeting the requirements of the Loan Documents or from or through any state or federal government-sponsored program or entity), payable because of loss sustained to all or part of the Property (including premium refunds), whether or not such insurance policies are required by Lender, proceeds of the taking thereof or of any rights appurtenant thereto, including change of grade of streets, curb cuts or other rights of access, by Condemnation, eminent domain or transfer in lieu thereof for public or quasi-public use under any law, proceeds arising out of any damage thereto, (ii) all letter-of-credit rights (whether or not the letter of credit is evidenced by a writing) Borrower now has or hereafter acquires relating to the properties, rights, titles and interests referred to in this Section 1.3, and (iii) other interests of every kind and character which Borrower now has or hereafter acquires in, to or for the benefit of the properties, rights, titles and interests referred to above in this Section 1.3, including rights of ingress and egress and remainders, reversions and reversionary rights or interests;
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(e) If the estate of Borrower in any of the property referred to above in this Section 1.3 is a leasehold estate, this conveyance shall include, and the lien and security interest created hereby shall encumber and extend to, all other or additional title, estates, interests or rights which are now owned or may hereafter be acquired by Borrower in or to the property demised under the lease creating the leasehold estate; and
(f) All additions and accretions to, substitutions and replacements for, and changes in any of the property referred to above in this Section 1.3.
Section 1.4 Security Interest . To secure the obligations of Borrower under the Loan Documents and all other matters and indebtedness constituting the Secured Indebtedness, Borrower hereby grants to Lender a security interest in all of the Collateral, including all proceeds and products thereof and all supporting obligations ancillary thereto or arising in any way in connection therewith. In addition to its rights hereunder or otherwise, Lender and any Holder shall have all of the rights of a secured party under the Virginia Uniform Commercial Code, as in effect from time to time, or under the Uniform Commercial Code in force from time to time in any other state to the extent the same is applicable law.
Section 1.5 Secured Indebtedness . This Deed of Trust is made to secure and enforce the payment and performance of the Secured Indebtedness.
Section 1.6 Construction Deed of Trust . This Deed of Trust constitutes a " construction mortgage" as defined in Va. Code Section 8.9A-334 of the Virginia Uniform Commercial Code to the extent that it secures obligations incurred for the construction of improvements on the land and the acquisition cost of land and improvements. This is also a " construction loan deed of trust or mortgage" within the meaning of Va. Code Section 58.1-804 with respect to the Revolving Loan which was made for real estate construction, which shall become due and payable on demand or three years or less from the date of the Revolving Loan Note.
ARTICLE 2. Representations, Warranties and Covenants
Section 2.1 Borrower represents, warrants and covenants as follows:
(a) Payment and Performance . Borrower will make due and punctual payment of the Secured Indebtedness. Borrower will timely and properly perform and comply with all of the covenants, agreements and conditions imposed upon it by this Deed of Trust and the other Loan Documents and will not permit a Default to occur hereunder or thereunder. Time shall be of the essence in this Deed of Trust.
(b) Title and Permitted Encumbrances . Borrower has in Borrower' s own right, and Borrower covenants to maintain, lawful, good and marketable title to the Property, is lawfully seized and possessed of the Property and every part thereof, and has the right to convey the same, free and clear of all liens, charges, claims, security interests, and encumbrances except for the Permitted Encumbrances. Borrower, and Borrower' s successors, will warrant generally and forever defend title to the Property, subject as aforesaid to the Permitted Encumbrances, to Trustee and its successors or substitutes and assigns, against the claims and
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demands of all persons claiming or to claim the same or any part thereof. Inclusion of any matter as a Permitted Encumbrance does not constitute approval or waiver by Holder of any existing or future violation or other breach thereof by Borrower, the Property or otherwise. If any material right or interest of Holder in the Property or any part thereof shall be endangered or questioned or shall be attacked directly or indirectly, Trustee and Holder, or either of them (whether or not named as parties to legal proceedings with respect thereto), are hereby authorized and empowered to take such steps as in their discretion may be proper for the defense of any such legal proceedings or the protection of such right or interest of Holder, including the employment of independent counsel, the prosecution or defense of litigation, and the compromise or discharge of adverse claims. All expenditures so made of every kind and character shall be a demand obligation (which obligation Borrower hereby promises to pay) owing by Borrower to Holder or Trustee (as the case may be), and the party (Holder or Trustee, as the case may be) making such expenditures shall be subrogated to all rights of the person receiving such payment.
(c) Taxes and Other Impositions . Borrower will pay or cause to be paid all of the following (" Property Assessments" ): all taxes, assessments and other charges or levies imposed upon or against or with respect to the Property or the ownership, use, occupancy or enjoyment of any portion thereof, or any utility service thereto, as the same become due and payable, including all real estate taxes assessed against the Property or any part thereof. Upon request, Borrower shall deliver promptly to Holder such evidence of the payment of the Property Assessments as Holder may require.
(d) Insurance Coverage . Borrower shall obtain and maintain at Borrower' s sole expense: (i) mortgagee title insurance issued to Lender covering the Premises as required by Lender, without exception for mechanic' s liens and (ii) the additional insurance prescribed in Section 4.9 of the Loan Agreement.
(e) Insurance Policy Requirements . All insurance policies shall be issued and maintained by insurers, in amounts, with deductibles, limits and retentions and in forms satisfactory to Holder and otherwise in accordance with the requirements of Section 4.9 of the Loan Agreement. Without limiting the discretion of Holder with respect to required endorsements to insurance policies, all policies for loss of or damage to the Property shall contain a standard mortgagee clause (without contribution) naming Holder as mortgagee with loss proceeds payable to Holder notwithstanding (i) any act, failure to act or negligence of or violation of any warranty, declaration or condition contained in any such policy by any named or additional insured, (ii) the occupation or use of the Property for purposes more hazardous than permitted by the terms of any such policy, (iii) any foreclosure or other action by Holder under the Loan Documents, or (iv) any change in title to or ownership of the Property or any portion thereof, such proceeds to be held for application as provided in the Loan Documents.
(f) Insurance Proceeds . The proceeds of all insurance required hereunder and under the other Loan Documents, including the Loan Agreement, shall be handled in accordance with the provisions of Sections 4.10 and 4.11 of the Loan Agreement and as otherwise prescribed therein. Additionally if any loss occurs at any time when Borrower has failed to perform Borrower' s covenants and agreements with respect to any insurance payable because of loss sustained to any part of the Property, whether or not such insurance is required by
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Holder, Holder shall nevertheless be entitled to the benefit of all insurance covering the loss and held by or for Borrower, to the same extent as if it had been made payable to Holder. Upon any foreclosure hereof or transfer of title to the Property in extinguishment of the whole or any part of the Secured Indebtedness, all of Borrower' s right, title and interest in and to the insurance policies referred to in this clause (f) (including unearned premiums) and all proceeds payable thereunder shall thereupon vest in the purchaser at foreclosure or other such transferee, to the extent permissible under such policies. Holder shall have the right (but not the obligation) to make proof of loss for, settle and adjust any claim under, and receive the proceeds of, all insurance for loss of or damage to the Property, regardless of whether or not such insurance policies are required by Holder, and the expenses incurred by Holder in the adjustment and collection of insurance proceeds shall be a part of the Secured Indebtedness and shall be due and payable to Holder on demand. Holder shall not be, under any circumstances, liable or responsible for failure to collect or exercise diligence in the collection of any of such proceeds or for the obtaining, maintaining or adequacy of any insurance or for failure to see to the proper application of any amount paid over to Borrower. Borrower shall at all times comply with the requirements of the insurance policies required hereunder and of the issuers of such policies and of any board of fire underwriters or similar body as applicable to or affecting the Property.
(g) Reserve for Insurance, Taxes and Assessments . Upon written request of Holder, to secure the payment and performance of the Secured Indebtedness, but not in lieu of such payment and performance, Borrower will deposit with Holder a sum equal to real estate taxes, assessments and charges (which charges for the purposes of this clause (g) shall include any recurring charge which could result in a lien against the Property) against the Property for the current year and the premiums for such policies of insurance for the current year, all as estimated by Holder and prorated to the end of the calendar month following the month during which Holder' s request is made, and thereafter will deposit with Holder, on each date when an installment of principal and/or interest is due on the Note, sufficient funds (as estimated from time to time by Holder) to permit Holder to pay at least fifteen (15) days prior to the due date thereof, the next maturing real estate taxes, assessments and charges and premiums for such policies of insurance. Holder shall have the right to rely upon tax information furnished by applicable taxing authorities in the payment of such taxes or assessments and shall have no obligation to make any protest of any such taxes or assessments. Any excess over the amounts required for such purposes shall be held by Holder for future use, applied to any Secured Indebtedness or refunded to Borrower, at Holder' s option, and any deficiency in such funds so deposited shall be made up by Borrower upon demand of Holder. All such funds so deposited shall bear no interest, may be commingled with the general funds of Holder and shall be applied by Holder toward the payment of such taxes, assessments, charges and premiums when statements therefor are presented to Holder by Borrower (which statements shall be presented by Borrower to Holder a reasonable time before the applicable amount is due); provided, however, that, if a Default shall have occurred hereunder, such funds may at Holder' s option be applied to the payment of the Secured Indebtedness in the order determined by Holder in its sole discretion, and that Holder may (but shall have no obligation) at any time, in its discretion, apply all or any part of such funds toward the payment of any such taxes, assessments, charges or premiums which are past due, together with any penalties or late charges with respect thereto. The conveyance or transfer of Borrower' s interest in the Property for any reason (including the foreclosure of a subordinate
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lien or security interest or a transfer by operation of law) shall constitute an assignment or transfer of Borrower' s interest in and rights to such funds held by Holder under this clause (g) but subject to the rights of Holder hereunder.
(h) Condemnation . In the event of Condemnation, Lender shall have all of the rights and remedies set forth in the Loan Agreement and Borrower shall comply with all agreements and requirements respecting Condemnation set forth in the Loan Agreement. All costs and expenses (including reasonable attorneys' fees) incurred by Holder in connection with any Condemnation shall be a demand obligation owing by Borrower (which Borrower hereby promises to pay) to Holder pursuant to this Deed of Trust.
(i) Adjustment of Condemnation and Insurance Claims . All claims and proceeds related to Condemnation, Casualty and insurance required hereunder and under the Loan Agreement shall be adjusted, received, paid, applied and utilized in accordance with the terms of Sections 4.10 and 4.11 of the Loan Agreement and as otherwise prescribed therein.
(j) Compliance with Legal Requirements . The Property and the use, operation and maintenance thereof and all activities thereon do and shall at all times comply with all applicable Legal Requirements. The Property is not, and shall not be, dependent on any other property or premises or any interest therein other than the Property to fulfill any requirement of any Legal Requirement. Borrower shall not, by act or omission, permit any building or other improvement not subject to the lien of this Deed of Trust to rely on the Property or any interest therein to fulfill any requirement of any Legal Requirement. No improvement upon or use of any part of the Property constitutes a nonconforming use under any zoning law or similar law or ordinance. Borrower has obtained and shall preserve in force all requisite zoning, utility, building, health, environmental and operating permits from the governmental authorities having jurisdiction over the Property. If Borrower receives a notice or claim from any person that the Property, or any use, activity, operation or maintenance thereof or thereon, is not in compliance with any Legal Requirement, Borrower will promptly furnish a copy of such notice or claim to Holder. Borrower has received no notice and has no knowledge of any such noncompliance.
(k) Maintenance, Repair and Restoration . Borrower will keep the Property in first class order, repair, operating condition and appearance, causing all necessary repairs, renewals, replacements, additions and improvements to be promptly made, and will not allow any of the Property to be misused, abused or wasted or to deteriorate. Notwithstanding the foregoing, Borrower will not, without the prior written consent of Holder, (i) remove from the Property any Accessories that reduce the value of the Property by more than $100,000.00 except such as is replaced by Borrower by an article of equal suitability and value, owned by Borrower, free and clear of any lien or security interest (except that created by this Deed of Trust and the Permitted Encumbrances), or (ii) make any structural alteration to the Property or any other alteration thereto which reduces the value thereof by more than $100,000.00. If any act or occurrence of any kind or nature (including any Condemnation or any Casualty for which insurance was not obtained or obtainable) shall result in damage to or loss or destruction of the Property in excess of $25,000.00, Borrower shall give prompt notice thereof to Holder and Borrower shall promptly, at Borrower' s sol...
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