MORTGAGE CONSOLIDATION,
MODIFICATION AND EXTENSION AGREEMENT

Dated:  March 13, 2020
in the original principal amount of

$25,000,000.00

between

SUTTON HILL PROPERTIES, LLC,  Mortgagor
a Nevada limited liability company,
qualified to do business in New York
having its principal place of business at:
5995 Sepulveda Boulevard, Suite 300
Culver City, California 90230

and

VALLEY NATIONAL BANK,  Mortgagee
a national banking association,
having an office at:
1455 Valley Road
Wayne, New Jersey 07470

LOCATION OF PREMISES:

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Street Address:  1001-1007 Third Avenue

City of:  New York

County of:  New York

State of:  New York

Block:  1414

Lots:  48

 

 

﻿

AFTER RECORDING, PLEASE RETURN TO:

VALLEY NATIONAL BANK
1720 ROUTE 23 NORTH
WAYNE, NEW JERSEY 07470

 

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MORTGAGE CONSOLIDATION, MODIFICATION AND EXTENSION AGREEMENT (the “Consolidation
Agreement”), dated March 13, 2020, given between SUTTON HILL PROPERTIES, LLC, a
Nevada limited liability company qualified to do business in New York, having
its principal place of business at 5995 Sepulveda Boulevard, Suite 300, Culver
City, California 90230 (“Mortgagor”) and VALLEY NATIONAL BANK, a national
banking association having an office at 1455 Valley Road, Wayne, New Jersey
07470 (“Mortgagee”).

W I T N E S S E T H:

WHEREAS,  Mortgagor is the lawful owner of that certain parcel of real property
known as 1001-1007 Third Avenue, New York, New York 10022, in the City, County
and State of New York, as more particularly described in Schedule A attached
hereto and made a part hereof (the “Land”), together with all buildings and
other improvements located on the Land (the Land, together with all such
buildings and other improvements, collectively, the “Premises”);

WHEREAS,  Mortgagee is the lawful owner and holder of those certain mortgages
set forth on Schedule B attached hereto and made a part hereof (collectively,
the “Mortgages”) and the notes secured thereby (collectively, the “Notes”) in
the aggregate original principal amount of $25,000,000.00 on which Notes there
is currently outstanding, in the aggregate, the principal amount of
$25,000,000.00; and

WHEREAS,  Mortgagor and Mortgagee have agreed in the manner hereinafter set
forth to (i) consolidate and coordinate the respective liens of the Mortgages,
(ii) combine and coordinate the Notes and the principal sums evidenced thereby
and (iii) modify the time and manner of payment and the terms and provisions of
the Notes and the Mortgages.

NOW, THEREFORE,  in consideration of the foregoing and of the mutual agreements
hereinafter set forth and for other good and valuable consideration, the receipt
and sufficiency of which is hereby acknowledged, the parties hereto hereby agree
as follows:

1.Representations and Warranties.  Mortgagor represents and warrants to
Mortgagee that:

(a)There is, as of the date hereof, due and owing upon the Mortgages, the
aggregate principal amount of TWENTY-FIVE MILLION AND 00/100 DOLLARS
($25,000,000.00), together with interest thereon and other charges evidenced
thereby, in each case without offset, defense or counterclaim of any kind or
nature whatsoever.  (Such outstanding amounts, together with all interest
thereon and such other amounts as may be outstanding from time to time under the
Notes and Mortgages and under the Consolidated Note (as hereafter defined),
being hereinafter referred to, collectively, as the “Indebtedness”).

(b)As of the date hereof, there are no notices of defaults or notices of events
of default under the Notes and Mortgages.

(c)Mortgagor is the holder of good, marketable, insurable fee title in and to
the Premises, subject to the Permitted Encumbrances (as defined in Schedule C
attached

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hereto) and has full power, good right and lawful authority to encumber the
Premises in the manner and form set forth in the Mortgages and to execute and
deliver this Consolidation Agreement.

(d)The execution and delivery of this Consolidation Agreement does not and will
not violate the terms of Mortgagor’s operating agreement or articles of
organization, or any other lease, agreement, mortgage, indenture or instrument
affecting Mortgagor or the Premises or any law, rule, order, ordinance or
statute of any governmental authority, purporting to have jurisdiction over
Mortgagor or the Premises.

2.Consolidation of Notes.  The Notes and the respective principal indebtedness
evidenced thereby are hereby combined and consolidated to constitute a single
indebtedness in the aggregate principal amount of TWENTY-FIVE MILLION AND 00/100
DOLLARS ($25,000,000.00), together with interest heretofore accrued on each of
such Notes.

3.Consolidated Note.  Concurrently herewith, Mortgagor is executing and
delivering to Mortgagee that certain Restated Mortgage Promissory Note (the
“Consolidated Note”), dated of even date herewith, made by Mortgagor, as maker,
in favor of Mortgagee, as payee, evidencing the consolidation of the Notes,
which Consolidated Note amends, modifies and restates the terms, provisions and
time of payment of the Notes in all respects and from and after the date hereof,
the Notes shall be deemed replaced by the Consolidated Note and Mortgagor shall
pay the Indebtedness in accordance with, and shall comply with the terms and
conditions set forth in the Consolidated Note, which Consolidated Note is hereby
substituted for the Notes.

4.Consolidation of Mortgages.  The liens of the Mortgages are hereby
consolidated and coordinated so that together they shall hereafter constitute in
law but one mortgage, a single, first lien upon the Premises securing the
Indebtedness.

5.Modification of Consolidated Mortgage.  The Mortgages, as consolidated and
coordinated hereby, are also modified, extended, amended and restated in their
entirety and the terms, covenants and conditions of the Mortgages, as
consolidated, shall be and hereby are superseded and replaced by the terms,
covenants and conditions set forth in Schedule C annexed hereto and made a part
hereof (the Mortgages, as so consolidated, modified, extended, amended and
restated in Schedule C hereto, together with this Consolidation Agreement, are
referred to, collectively, as the “Consolidated Mortgage”).  Mortgagor agrees to
comply with and be subject to all of the terms, covenants and conditions of this
Consolidated Mortgage.

6.Use of Terms.  The terms  “Land”, “Improvements”, “Premises”  and “Mortgaged
Property”  shall have the meanings ascribed to them in Schedule C attached
hereto when used in this Consolidated Mortgage.  Whenever the term “note” or
“Note”, shall be used in this Consolidated Mortgage or in the Consolidated Note,
such term shall mean and refer to the Consolidated Note, as such Consolidated
Note may be further modified from time to time.  Whenever the terms “mortgage”
or “Mortgage”  shall be used in this Consolidated Mortgage (including, without
limitation, Schedule C hereto), or in the Consolidated Note,

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such terms shall mean and refer to this Consolidated Mortgage, as this
Consolidated Mortgage may be further modified from time to time.  Terms defined
in this Consolidation Agreement that are used in Schedule C hereto that are not
otherwise defined in such schedule, shall have the meaning accorded such terms
in this Consolidation Agreement.

7.Subsequent Modifications.  Any written agreement or agreements hereafter
entered into by the Mortgagee that (i) extend the time of payment of the
Indebtedness, (ii) change or modify the time or times of payment or the amount
of the installments or fixed sums or the interest or the rate thereof, (iii)
change, modify, extend, renew or terminate other terms, provisions, covenants or
conditions of the Consolidated Mortgage or the obligations that it secures or
this Consolidation Agreement, or (iv) consolidate, spread, release or sever the
lien of the Consolidated Mortgage shall be effective in accordance with the
terms and provisions thereof and shall be binding according to the tenor thereof
on the owner or holder of subordinate, intervening or subsequent liens or
security interests on the Premises and any such liens or security interests
shall continue to be subject and subordinate to this Consolidated Mortgage and
any such agreement or agreements.

8.No New Indebtedness; Maximum Principal Amount.  (a) The parties hereto hereby
certify that this Consolidation Agreement secures the same indebtedness
evidenced by the Notes, together with interest thereon, and secured by this
Consolidated Mortgage, and evidences and secures no further or other
indebtedness or obligation.

(a)Notwithstanding anything to the contrary contained herein, the maximum
principal that which is secured by the Consolidated Mortgage as of the date
hereof, or that under any contingency may be secured by the Consolidated
Mortgage at any time in the future, shall not exceed the principal sum of
TWENTY-FIVE MILLION AND 00/100 DOLLARS ($25,000,000.00) plus (i) taxes, charges
and assessments which may be imposed by law on the Premises, (ii) premiums on
the insurance policies required to be maintained under the Consolidated
Mortgage, and (iii) expenses incurred in upholding the lien of this Agreement
including, but not limited to, the expenses of any litigation to prosecute or
defend the rights and liens created by this Agreement, any amount, cost or
charge to which this Agreement becomes subrogated, upon payment, whether under
recognized principles of law or equity, or under express statutory authority,
and interest at the regular interest rate or Default Rate (as defined in the
Consolidated Note).

9.No Oral Modification.  The terms hereof may not be waived, changed, modified,
terminated or discharged orally, but only by an agreement in writing signed by
the party against whom enforcement of any such waiver, change, modification,
termination or discharge is sought.

10.Ratification.  Mortgagor hereby (i) ratifies and confirms the Indebtedness
and the lien, conveyance and grant contained in and created by this (ii) agrees
that nothing contained in this Consolidation Agreement is intended to or shall
impair the validity of the Indebtedness or the lien, conveyance and grant of the
Consolidated Mortgage.  Unless specifically modified by the terms hereof, the
parties hereto ratify and confirm each and every term of the Consolidated
Mortgage and the Consolidated Note, which shall continue in full force and
effect.

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11.Further Assurances.  Mortgagor shall execute and deliver, at Mortgagor’s sole
cost and expense, such additional documents as shall be requested by Mortgagee
from time to time to effectuate the terms and conditions of this Consolidation
Agreement, the Consolidated Note and the Consolidated Mortgage, including,
without limitation, such affidavits as shall be necessary to permit this
Consolidation Agreement to be recorded in the appropriate public records. 
Mortgagor hereby appoints Mortgagee its attorney in fact to execute, acknowledge
and deliver for and in the name of the Mortgagor any and all of the instruments
mentioned in this section, and this power, being coupled with an interest, shall
be, irrevocable as long as any part of the Indebtedness remains unpaid.

12.Successors and Assigns.  This Consolidation Agreement shall bind, and inure
to the benefit of, the parties hereto, their respective successors and permitted
assigns.

13.Counterparts.  This Consolidation Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.

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[SIGNATURE PAGE FOLLOWS.]

 

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IN WITNESS WHEREOF, this Mortgage Consolidation, Modification and Extension
Agreement has been executed by the parties hereto as of the day and year first
written above.

﻿

,
a Nevada limited liability company,
qualified to do business in New York

Citadel Cinemas, Inc.,
a Nevada corporation,
its Manager

/s/ Gilbert Avanes
Name:  Gilbert Avanes
Title:  EVP, Chief Financial Officer and Treasurer

 

﻿

MORTGAGOR:

SUTTON HILL PROPERTIES, LLC,
a Nevada limited liability company,
qualified to do business in New York

By:  Citadel Cinemas, Inc.,
a Nevada corporation,
its Manager

By:       /s/ Gilbert Avanes

Name:  Gilbert Avanes
Title:  EVP, Chief Financial Officer and Treasurer

﻿

MORTGAGE:

VALLEY NATIONAL BANK,
a national banking association

By:       /s/ Richard Grani

Name:  Richard Grani
    Title:  Vice President

﻿

 

 

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UNIFORM FORM CERTIFICATE OF ACKNOWLEDGMENT
(Outside of New York State)

State, District of Columbia, Territory, Possession, or Foreign Country

State of

)

﻿

) ss.:

County of

)

﻿

On the _____ day of March in the year 2020 before me, the
undersigned, personally appeared Gilbert Avanes personally known to me or proved
to me on the basis of satisfactory evidence to be the individual(s) whose
name(s) is(are) subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their capacity(ies), that by
his/her/their signature(s) on the instrument, the individual(s), or the person
upon behalf of which the individual(s) acted, executed the instrument, and that
such individual(s) made such appearance before the undersigned in the
______________________________________________________________________________
(insert city or other political subdivision and state or country or other place
the acknowledgment was taken).

﻿

 

﻿

 

(signature and office of individual taking acknowledgment)

﻿

UNIFORM FORM CERTIFICATE OF ACKNOWLEDGMENT
(Within New York State)

STATE OF NEW YORK

)

﻿

) ss.:

COUNTY OF NEW YORK

)

﻿

On the _____ day of March in the year 2020, before me, the undersigned,
personally appeared Richard Grani, personally known to me or proved to me on the
basis of satisfactory evidence to be the individual whose name is subscribed to
the within instrument and acknowledged to me that he/she executed the same in
his/her capacity, and that by his/her signature on the instrument, the
individual, or the person upon behalf of which the individual acted, executed
the instrument.

﻿

 

﻿

_______________________________________
Notary Public

﻿

 

 

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SCHEDULE A

Legal Description

ALL that certain plot piece or parcel of land, situate, lying and being in the
Borough of Manhattan, City of New York, County of New York, State of New York,
bounded and described as follows:

BEGINNING at the point of the easterly side of Third Avenue, distant northerly
100 feet 4 inches from the corner formed by the intersection of the northerly
side of 59 Street and the easterly side of Third Avenue;

RUNNING THENCE easterly parallel with the northerly side of 59th Street and part
of the way through a party wall, 105 feet;

THENCE northerly parallel with Third Avenue, 75 feet ¼ inch;

THENCE westerly parallel with 59th Street, 105 feet to the easterly side of
Third Avenue; and

THENCE southerly along the easterly side of Third Avenue, 75 feet ¼ inch to the
point or place of BEGINNING.

 

Schedule A-1

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SCHEDULE B

Schedule of Mortgages

1.Mortgage made by SUTTON HILL PROPERTIES, LLC to EUROHYPO AG, NEW YORK BRANCH
in the original principal amount of $15,000,000.00 dated June 28, 2007 and
recorded in the Office of the City Register, County of New York (the “Register’s
Office”) on July 10, 2007 as CRFN No. 2007000350847 (upon which mortgage
recording tax in the amount of $420,000.00 was duly paid);

Which said mortgage (1) was thereafter duly assigned by Assignment of Mortgage
from EUROHYPO AG, NEW YORK BRANCH to WELLS FARGO BANK, AS TRUSTEE, IN TRUST FOR
THE REGISTERED HOLDERS OF BANK OF AMERICA COMMERCIAL MORTGAGE INC., COMMERCIAL
MORTGAGE PASS-THROUGH CERTIFICAGTES, SERIES 2007-3 dated June 28, 2007 and
recorded in the Register’s Office on February 21, 2008 under CRFN No.
2008000070990.

Which said mortgage (1) was thereafter further duly assigned by Assignment of
Mortgage from WELLS FARGO BANK, AS TRUSTEE, IN TRUST FOR THE REGISTERED HOLDERS
OF BANK OF AMERICA COMMERCIAL MORTGAGE INC., COMMERCIAL MORTGAGE PASS-THROUGH
CERTIFICAGTES, SERIES 2007-3 to U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE, IN
TRUST FOR THE REGISTERED HOLDERS OF BANK OF AMERICA COMMERCIAL MORTGAGE INC.,
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICAGTES, SERIES 2007-3 dated July 6, 2009
and recorded in the Register’s Office on December 11, 2009 under CRFN No.
2009000407157.

Which said mortgage (1) was thereafter further duly assigned by Assignment of
Mortgage from U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE, IN TRUST FOR THE
REGISTERED HOLDERS OF BANK OF AMERICA COMMERCIAL MORTGAGE INC., COMMERCIAL
MORTGAGE PASS-THROUGH CERTIFICAGTES, SERIES 2007-3 to SOVEREIGN BANK, N.A. dated
June 28, 2012 and recorded in the Register’s Office on July 20, 2012 under CRFN
No. 2012000288511.

Amended and Restated Mortgage, Assignment of Leases and Rents, Security
Agreement and Fixture Filing made by SUTTON HILL PROPERTIES, LLC to SOVEREIGN
BANK, N.A. dated June 28, 2012 and recorded in the Register’s Office on July 20,
2012 under CRFN No. 2012000288512 (amends and restates said mortgage (1), as
assigned).

Amendment No. 1 to Amended and Restated Mortgage, Assignment of Leases and
Rents, Security Agreement and Fixture Filing made by SUTTON HILL PROPERTIES, LLC
to SANTANDER BANK, N.A., f/k/a SOVEREIGN BANK, N.A. dated June 26, 2014 and
recorded in the Register’s Office on August 4, 2014 under CRFN No. 2014000256252
(amends said mortgage (1), as amended, restated and assigned).

Which mortgage (1), as amended, restated and assigned, was thereafter assigned
by Assignment of Mortgage from SANTANDER BANK, N.A., f/k/a SOVEREIGN BANK, N.A.
to VALLEY NATIONAL BANK dated as of August 31, 2016 and intended to be duly
recorded in said Register’s Office simultaneously herewith.

Schedule B-1

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The outstanding principal balance secured by said mortgage, as assigned, is
$15,000,000.00.

2.Gap Mortgage made by SUTTON HILL PROPERTIES, LLC to VALLEY NATIONAL BANK in
the original principal amount of $5,000,000.00 dated as of August 31, 2016 and
intended to be duly recorded in said Register’s Office simultaneously herewith
(upon which the mortgage recording tax imposed by law was duly paid).

The outstanding principal balance secured by said mortgage is $18,548,210.77.

3.Gap Mortgage made by SUTTON HILL PROPERTIES, LLC to VALLEY NATIONAL BANK in
the original principal amount of $6,451,789.23 dated March 13, 2020 and intended
to be duly recorded in said Register’s Office simultaneously herewith (upon
which the mortgage recording tax imposed by law was duly paid);

Which mortgages (1), (2) and (3) were consolidated to form a single lien in the
original principal amount of $25,000,000.00 by Mortgage Consolidation, Extension
and Modification Agreement made between SUTTON HILL PROPERTIES, LLC and VALLEY
NATIONAL BANK dated March 13, 2020 and intended to be duly recorded in said
Register’s Office simultaneously herewith.

 

Schedule B-2

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SCHEDULE C

Consolidated Mortgage

 

Schedule C-1

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AMENDED AND RESTATED MORTGAGE

AND

SECURITY AGREEMENT

FROM

SUTTON HILL PROPERTIES, LLC

TO

VALLEY NATIONAL BANK

DATED:  MARCH 13, 2020

RECORD AND RETURN TO:

Commercial Mortgage Department
Valley National Bank
1720 Route 23 North
Wayne, New Jersey 07470

 

 

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AMENDED AND RESTATED MORTGAGE AND SECURITY AGREEMENT

This Amended and Restated Mortgage and Security Agreement (“Mortgage” and
referred in the Consolidation Agreement as the “Consolidated Mortgage”) is dated
the 13th day of March, 2020

BYSUTTON HILL PROPERTIES, LLC, a Nevada limited liability company qualified to
do business in New York, having its principal place of business at 5995
Sepulveda Boulevard, Suite 300, Culver City, California 90230 (“Mortgagor”),

ANDVALLEY NATIONAL BANK, a national banking association, having offices at
1455 Valley Road, Wayne, New Jersey 07470 (“Mortgagee”);

Background.  This Mortgage secures various Obligations (as defined below)
including, without limitation, a loan by Mortgagee to Mortgagor in the original
principal amount of TWENTY‑FIVE MILLION AND 00/100 DOLLARS ($25,000,000.00),
plus interest thereon, as evidenced by the Note.  In consideration of the
above-referenced loan and other good and valuable consideration, receipt of
which is hereby acknowledged, Mortgagor agrees as follows:

Section 1 - DEFINITIONS AND INTERPRETATIONS

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The definitions of the capitalized twins used in this Mortgage and the Note are
set forth in the body of this Mortgage and in Appendix A attached hereto and
incorporated herein in its entirety.

Section 2 - GRANTING CLAUSE

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To secure the observance, payment and performance of all Obligations, Mortgagor
hereby mortgages, grants a security interest in, and absolutely assigns all
rents, profits, leases, income and proceeds arising from, the Mortgaged Property
to Mortgagee and to Mortgagee’s successors and assigns forever.  These grants
are, however, made upon the express condition that after all Obligations are
paid and performed in full, Mortgagee shall discharge or assign this Mortgage
upon Mortgagor’s request as herein more specifically set forth and subject to
the terms and conditions herein set forth.

Section 3 - MORTGAGED PROPERTY

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The “Mortgaged Property” consists of a two story commercial building located at
1001‑1007 Third Avenue, New York, New York 10022 as more particularly described
on the attached Exhibit “A” (the “Mortgaged Property”) located upon the Land,
the Improvements, all of Mortgagor’s right, title and interest in and to the
Fixtures and Equipment, all Leases and Rents, all Awards and Proceeds, all Other
Rights, and all present and future estate, right, title, interest, property,
possessory interest and claims whatsoever in law as well as in equity of
Mortgagor or any other owner in and to the Land, Improvements and Fixtures,
Equipment and Other Rights.

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Section 4 – REPRESENTATIONS

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Mortgagor, knowing and agreeing that Mortgagee shall rely hereon, hereby
represents and warrants to Mortgagee that:

4.1Warranty of Title.  Mortgagor holds good and marketable title in fee simple
to the Mortgaged Property free of all liens, restrictions, taxes and
encumbrances, other than any Permitted Encumbrances, and warrants and forever
defend that title and the enforceability and priority of all liens created under
this Mortgage against all claims whatsoever, except for Permitted Encumbrances,
at Mortgagor’s sole expense.

4.2Valid Obligations.  The Loan Documents are the valid and binding obligations
of Mortgagor, enforceable in accordance with their terms to the maximum extent
permitted by law.  This Mortgage constitutes a valid first priority mortgage
lien on, and absolute assignment of Leases and Rents, and security interest in
the Mortgaged Property, subject to any Permitted Encumbrances.

4.3Existence and Authority.  Mortgagor is a duly organized and validly
existing limited liability company that is in good standing under the laws of
the State of Nevada and is authorized to do business in and is in good standing
under the laws of the State of New York.  Mortgagor has full power, authority
and license to enter into and perform this Mortgage and the other Loan Documents
to which Mortgagor is a party and Mortgagor has full power, authority and
license to own and operate the Mortgaged Property and to conduct its business as
now being conducted.  Mortgagor has obtained all necessary consents,
authorizations, permits, licenses and approvals required before Mortgagor may
execute and deliver this Mortgage and operate the Mortgaged Property.  There is
no provision in Mortgagor’s Articles of Organization or Operating Agreement (as
the same may have been heretofore amended or modified), or in any other document
applicable to the conduct of Mortgagor, requiring further consent for such
action by any other entity or person, which has not been obtained and provided
to Mortgagee.

4.4No Conflicts.  The execution, delivery and performance of this Mortgage and
other Loan Documents by Mortgagor will violate no charter, bylaw, lease,
indenture, agreement, instrument, law, ordinance, regulation, order or
administrative ruling to which Mortgagor is subject or a party or that affects
or relates to the Mortgaged Property.

4.5Proceedings.  Except as otherwise previously disclosed to Mortgagee pursuant
to that certain Disclosure Schedule of even date herewith by Mortgagor (the
“Disclosure Schedule”), there is no action, application, petition, proceeding or
hearing pending or, to Mortgagor’s knowledge, threatened against any Obligor or
the Mortgaged Property that might (a) adversely affect any Obligor’s ability to
perform the Mortgage or any other Loan Document, (b) involve the possibility of
any material adverse change in any Obligor’s economic condition, (c) relate to
any land use variance, subdivision, zoning or other similar matters, (d) involve
the possibility of any limitation on any intended uses of the Mortgaged
Property, (e) impair the lien or security of this Mortgage or the value of the
Mortgaged Property or (f) involve possible or threatened claims totaling in
excess of $10,000.00, except as heretofore disclosed to Mortgagee and its
attorney in writing.

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4.6Compliance with Laws.  Except as otherwise expressly set forth in the Title
Report (hereinafter defined) and Environmental Report (hereinafter defined),
Mortgagor and the Mortgaged Property are in compliance with all laws,
regulations, ordinances and codes that are applicable to the use and operation
of the Mortgaged Property, including, without limitation, all Environmental
Laws.  All present and planned uses and tenants of the Mortgaged Property are in
full compliance with applicable zoning, environmental and building laws,
ordinances, regulations and codes.  Mortgagor and all tenants of the Mortgaged
Property have obtained all certificates of occupancy and building and other
permits that are required for all intended uses of, and for any construction,
renovations and repairs with respect to, the Mortgaged Property.

4.7Condition of Property.  The Mortgaged Property is structurally sound, in
good condition and suitable for its intended use.  To Mortgagor’s knowledge,
there are no violations of any federal, state or local law, ordinance or
regulation affecting or against the Mortgaged Property, except those violations
which have been listed by the New York Metro Title Agency, Inc. (the “Title
Company”) in its title report #19-31665, dated January 21, 2020 and re-dated as
of the date hereof (the “Title Report”), which violations are dealt with in that
certain Undertaking of even date herewith made by Mortgagor to Mortgagee (the
“Undertaking”).

4.8Taxes.  All property taxes and assessments due and owing in connection with
the Mortgaged Property have been paid in full through the date of this Mortgage,
including any penalties, deficiency assessments and interest.  Mortgagor has
filed all federal, state, county, municipal, and city income and other tax
returns required to be filed by it and has paid all taxes that are due and owing
pursuant to such returns or pursuant to any assessments received by it,
including penalties, deficiency assessments and interest.

4.9Financial Information and Condition.  The financial statement of Mortgagor
and all tax returns delivered to Mortgagee truly set forth the financial
condition of Mortgagor and the results of operations as of that date and there
has been no material adverse change since then.  All other statements,
representations and warranties made by or, to Mortgagor’s knowledge, on behalf
of Mortgagor to Mortgagee have been, and as of the date of the Mortgage are,
accurate and complete and no information has been omitted that would make any of
them misleading or incomplete.  Immediately prior to and after the making of
this Mortgage, Mortgagor was not, nor will be, “insolvent” as that term is
defined in, New York Business Corporation Law §1201, et  seq.  or 11 U.S.C.A.
101(31).

4.10Leases.  There exist no leases or tenancies with respect to the Mortgaged
Property other than as set forth on the Schedule of Leases (as more particularly
described in that certain Assignment of Leases and Rents dated of even date
herewith made by Mortgagor in favor of Mortgagee) (being herein collectively
referred to as the “Existing Lease”), copies of which have been delivered to
Mortgagee.  The Existing Lease is in full force and effect and has not been
further amended or modified.  There has not occurred, and, to Mortgagor’s
knowledge, there is no circumstance or state of facts that with notice or lapse
of time would constitute, a default under any the Existing Lease.  Mortgagee
shall have all of the rights against any lessees of the Mortgaged Property set
forth in Section 291-f of the Real Property Law of New York.

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4.11No Broker.  No broker or finder other than Meridian Capital Group (the
“Broker”) introduced Mortgagor to Mortgagee.  The Broker’s commission shall be
paid in full by Mortgagor on the date hereof.

4.12Commercial Mortgage.  This Mortgage does not encumber real property
principally improved or to be improved by one or more structures containing in
the aggregate not more than six (6) residential units each having their own
separate cooking facilities.

4.13Governmental Licenses.  All licenses, consents and approvals required from,
and all registrations and filings required to be made with, any governmental or
other public body or authority to authorize the performance of its obligations
under this Mortgage have been obtained and effected.

4.14Litigation Affecting Mortgaged Property.  There is no action, suit,
proceeding or investigation pending or threatened, or, to the best of
Mortgagor’s knowledge, any basis therefor known to Mortgagor, which questions
the validity of this Mortgage or the Note, or any action taken or threatened to
be taken pursuant thereto.  No notice has been given by any governmental
authority of any proceeding to condemn, purchase or otherwise acquire the
Mortgaged Property or any part thereof or interest therein and, to Mortgagor’s
knowledge, no such proceeding is contemplated.

4.15Compliance with Laws.  Except as otherwise expressly set forth in the
Disclosure Schedule, the Title Report and the Environmental Report, Mortgagor is
in compliance in all material respects with all governmental laws, rules and
regulations and other requirements which are applicable to the Mortgaged
Property or any part thereof, or any use or condition of the Mortgaged Property
or any part thereof.  Mortgagor has no knowledge of any violation, nor is there
any notice or other record of violation, of any zoning, health, safety,
building, fire, labor, environment, or other statute, ordinance, rule,
regulation or restriction applicable to the Mortgaged Property or any part or
use thereof, except as set forth in the Title Report.

4.16Survival.  All representations and warranties made by, or on behalf of
Mortgagor in this Mortgage or otherwise made to Mortgagee shall survive the
closing of this Mortgage and any independent investigation by Mortgagee.

Section 5 - MORTGAGOR’S COVENANTS

﻿

Mortgagor and any other owner of the Mortgaged Property who shall assume the
Obligations covenant and agree that they shall do all of the following:

5.1Obligations.  Pay all indebtedness, and abide by all terms and conditions,
under all Obligations, including without limitation this Mortgage and the Note;

5.2Escrow Account.  At the time of each monthly payment, pay to Mortgagee (A)
the sum equal to one-twelfth (1/12th) of the known (or if not known, reasonably
estimated by Mortgagee) annual real estate taxes and assessments, water, sewer,
property, casualty and liability insurance and other charges levied or to be
levied against the premises by governmental entities and (B) such sums, if
required by Mortgagee, as are necessary to assure the timely payment of
all charges described in Section 6 below, to be held by Mortgagee in a
non-interest bearing account

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and applied by Mortgagee to the payment of such taxes, assessments and other
charges when due.  If the total of such monthly payments shall exceed the
amounts actually paid by Mortgagee for taxes, assessments and other charges, as
the case may be, such excess shall be credited on subsequent monthly payments of
the same nature or promptly refunded to Mortgagor upon payment and performance
in full of all Obligations; but if the total of such monthly payments shall be
insufficient to pay taxes, assessments and other charges when due, then
Mortgagor shall pay to Mortgagee, on demand, any amount necessary to make up the
deficiency.  Notwithstanding the foregoing, upon the occurrence of an Event of
Default, Mortgagee may apply all sums in said escrow account to the reduction of
the Obligations.  Notwithstanding the above, the Mortgagee shall not require
such escrow for annual real estate taxes and assessments, water, sewer,
property, casualty, liability or any other insurance unless:

(a)intentionally omitted;

(b)an Event of Default exists;

(c)intentionally omitted.

5.3Financial Reporting.  Immediately notify Mortgagee of any material adverse
change in the financial condition of Mortgagor and deliver to the Mortgagee the
following:

(a)annually, as soon as available but no later than 120 days after the close of
each fiscal year of Mortgagor, compiled financial statements for Mortgagor which
annual financial statements shall disclose in reasonable detail all assets and
liabilities of Mortgagor and shall be certified by an officer of Reading;

(b)annually, copies of filed federal income tax returns for Mortgagor, including
all schedules thereto (including, without limitation, K-1’s for all principals
thereof), within 30 days after filing of same; provided that if Mortgagor shall
file an extension, Mortgagor shall provide evidence satisfactory to Mortgagee of
each such request and approval, and thereafter, a copy of the filed federal
income tax return, including all schedules thereto, within 30 days after filing
of same;

(c)intentionally omitted;

(d)annually, a copy of Form 10-K annual report of Guarantor, including all
schedules thereto, within 30 days after filing of same;

(e)simultaneously with the submission of financial statements for Mortgagor, a
certificate of Mortgagor’s CFO stating that (i) the signer has no knowledge of a
default under any Loan Document for the Mortgagor or (ii) if any default existed
or exists, its nature, when it occurred and what remedial action is being taken;

(f)intentionally omitted;

(g)a certified rent roll for the Mortgaged Property, within thirty (30) days
after the end of each calendar year or simultaneously with the submission of
financial statements for Mortgagor, whichever is later, which rent roll shall
include the name of each tenant, the

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term of each tenancy, the current rent due from each such tenant, and a schedule
of any arrears or prepaid rents and security deposits for each tenant of the
Mortgaged Property; and

(h)such other information as Mortgagee reasonably may request.

5.4Use of Property.  Make or permit no use of the Mortgaged Property other than
as a movie theater, or as otherwise permitted under the current certificate of
occupancy, in compliance with all laws, ordinances, regulations and restrictions
affecting the Mortgaged Property.

5.5Condition of Property.  Prevent any waste with respect to the Mortgaged
Property, keep or cause the tenant under the Existing Lease or any other
tenant(s) to keep the Mortgaged Property in good and clean condition and make
all repairs that are required in the ordinary course of business to operate the
Mortgaged Property.

5.6Alterations.  Make no material change to or renovation of, nor remove, any
material Improvements or Fixtures and Equipment without the express prior
written consent of Mortgagee in its reasonable discretion (except that
Mortgagee’s consent shall not be required with respect to non-structural
alterations necessary or convenient to achieve ADA compliance required by law or
as a result of a settlement or resolution of a claim, and work required in the
ordinary course in connection with the maintenance and operation of a cinema,
including, but not limited to, repair of HVAC system, the hard and soft costs of
which work shall be less than $250,000.00, provided, however, that Mortgagor
shall provide written notice to Mortgagee prior to the commencement of any such
work which shall require a building permit or other approval from any
Governmental Authority).  All changes, renovations, removals and repairs shall
be made in a good and workmanlike manner to the reasonable satisfaction of
Mortgagee and in accordance with all applicable building and zoning laws.  As
used herein, the term “ADA” means the Americans with Disabilities Act of 1990,
as amended and supplemented from time to time, and any New York City laws,
rules, and regulations concerning the subject matter thereof.

5.7Notice of Loss or Condemnation.  Notify Mortgagee immediately in writing
upon learning that (a) there has occurred any casualty on, or loss to or of, any
Mortgaged Property or (b) condemnation proceedings have commenced with respect
to the Mortgaged Property.

5.8Inspections.  At any time during regular business hours and as often as
requested upon not less than 24 hours prior notice (which may be oral), permit
Mortgagee and its agents and employees to examine, audit and make copies and
abstracts from any and all books and records of Mortgagor, and, subject to any
rights of the tenant under the Existing Lease, if any, to visit and inspect the
Mortgaged Property.

5.9Compliance With Laws.  Comply with all laws, ordinances, regulations
and restrictions affecting the Mortgaged Property.

5.10Transfers of Interests.  Without the express prior written consent of
Mortgagee in its absolute discretion, make or permit no Transfer in the
ownership or control of Mortgagor or the Mortgaged Property or any part thereof
(including, without limitation, the conveyance of all or any portion of the air
rights with respect to the Mortgaged Property), directly or indirectly,
voluntarily or involuntarily.  Without the prior written consent of Mortgagee in
its absolute

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discretion, Mortgagor shall not create or permit to exist any lien, encumbrance
or security interest in favor of any third party with respect to the Mortgaged
Property and Mortgagor shall keep the Mortgaged Property free from any such lien
or security interest other than those created in favor of Mortgagee pursuant to
the Loan Documents and liens for taxes not yet due and payable.  Notwithstanding
the foregoing, so long as Reading International, Inc., a Nevada corporation
(“Reading”), shall remain a publicly traded company, Mortgagee’s prior written
consent shall not be required for any Permitted Transfer (as defined below), so
long as all Transfer Requirements (as defined below) are timely satisfied.  For
purposes of this Section, (i) the term “Permitted Transfer” shall mean the
transfer of any or all of the Equity Interests (as defined below) in Reading,
(ii) the term “Transfer Requirements” means, with respect to any Permitted
Transfer, all of the following:  (1) Reading shall not be released from any
liability under any guaranty, and (2) no Event of Default hereunder or under any
of the other Loan Documents shall exist and be continuing, and (iii) the term
“Equity Interest” means shares of stock of Reading.

5.11Preservation.  Preserve and maintain all authorizations, consents, licenses,
permits, registrations and qualifications that are necessary for the transaction
of business and the operation of the Mortgaged Property.

5.12Indemnification.  Indemnify, defend (with counsel reasonably acceptable
to Mortgagee) and hold harmless Mortgagee (including Mortgagee’s agents,
employees, officers and directors) against all losses, claims, suits, fines,
damages and expenses, including reasonable attorney’s fees and disbursements,
incurred by reason of, or in connection with, this Mortgage or the Mortgaged
Property or in maintaining Mortgagee’s interest in the Mortgaged Property,
including, without limitation, all losses, claims, suits, fines, damages and
expenses incurred by reason of, or in connection with, Mortgagor’s breach of any
provision of Section 7 of this Mortgage or any violation of any Environmental
Law of the Use of Hazardous Substances on the Mortgaged Property.

5.13Cooperation.  Mortgagor will, at its sole cost and expense, and without
expense to Mortgagee, do, execute, acknowledge and deliver all and every such
further acts, deeds, conveyances, mortgages, assignments, notices of assignment,
transfers and assurances as Mortgagee shall from time to time reasonably require
for the better assuring, conveying, assigning, transferring and confirming unto
Mortgagee the property and rights hereby conveyed, mortgaged or assigned or
intended now or hereafter so to be, or which Mortgagor may be or may hereafter
become bound to convey, mortgage or assign to Mortgagee or for carrying out the
intention or facilitating the performance of the terms of this Mortgage, and for
filing or recording this Mortgage and, on demand, will execute and deliver, and
hereby authorizes Mortgagee to execute in the name of Mortgagor to the extent it
may lawfully do so, one or more financing statements or comparable security
instruments, and renewals thereof to evidence more effectively the lien hereof
upon the Fixtures and Equipment.

5.14Governmental Charges re:  Mortgage.  Mortgagor will pay all taxes, filing
and recording fees, and all expenses incident to the execution and
acknowledgement of the Note, this Mortgage, any mortgage supplemental hereto,
and any security instrument with respect to the Fixtures and Equipment, any
instrument of further assurance, and all federal, state, county and municipal
stamp taxes and other taxes, duties, imposts, assessments and charges arising
out of or in connection with the execution and delivery of the Note, this
Mortgage, any mortgage

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supplemental hereto, any security instrument with respect to the Fixtures and
Equipment or any instrument of further assurance, other than income, franchise
or other similar taxes imposed upon Mortgagee.

5.15Mechanic’s Liens.  Mortgagor will pay, from time to time when the same shall
become due, all lawful claims and lawful demands of mechanics, materialmen,
laborers and others, which, if unpaid, might result in, or permit the creation
of, a lien on the Mortgaged Property or any part thereof, or on the revenues,
rents, issues, income and profits arising therefrom, and in general will do or
cause to be done everything necessary so that the lien hereof shall be fully
preserved, at the cost of Mortgagor, without expense to Mortgagee.

5.16Taxation of Mortgage.  Mortgagor will pay all taxes, including, without
limitation, any taxes imposed on Mortgagee by reason of its ownership of the
Note or this Mortgage or foreclosure of same.  Mortgagor shall not, however, be
liable for any income taxes payable by or due from Mortgagee with respect to
interest earned on the Loan or for any taxes payable by or due from Mortgagee by
reason of the sale or transfer of this Mortgage or the Note.  In the event of
the present existence or the passage after the date of this Mortgage of any law
of the State of New York deducting from the value of real property for the
purposes of taxation any lien thereon or changing in any way the laws for the
taxation of mortgages or debts secured by a mortgage for state or local purposes
or the manner of collection of any such taxes and imposing a tax, either
directly or indirectly, on this Mortgage or the Note, Mortgagor shall promptly
pay or cause such tax to be paid or discharged.  In the event Mortgagor does not
promptly cause any such tax to be discharged, the holder of this Mortgage shall
have the right to declare the unpaid principal balance of the Note and all
accrued and unpaid interest due on a date to be specified by not less than
twenty (20) days’ written notice to be given to Mortgagor by Mortgagee.

5.17Leases.  As to all Leases and Rents, comply with each of the following:

(a)The Mortgagor will not, without the prior written consent and approval of the
Mortgagee in each instance, (i) execute an assignment of the rents for the
Mortgaged Property or any part thereof, (ii) enter into any leases, lettings or
license arrangements affecting the Mortgaged Property or any part thereof, (iii)
enter into modification of leases in existence on the date hereof, or (iv) in
any other manner impair the value of the Mortgaged Property or the security of
the Mortgage.  Reference is made to Section 291‑ (f) of the Real Property Law
with respect to the following:  Mortgagor will not, without the prior written
consent and approval of the Mortgagee, in each instance (x) terminate or consent
to the cancellation or surrender of any lease of the Mortgaged Property or of
any part thereof, now existing or hereafter to be made, (y) materially modify or
vary any such lease, or (z) accept prepayments of any installments of rents to
become due under such leases, except prepayments in the nature of security for
the performance of the lessees thereunder.  Notwithstanding the foregoing,
Mortgagee’s prior written consent shall not be required with respect to written
license agreements (“License Agreements”) for short term (i.e., less than seven
(7) calendar days) individual auditorium usage (e.g., film festival, church
service, birthday party, etc.), provided that all such license agreements shall
be revocable at will and shall expressly provide that they are subordinate to
this Mortgage and shall in no way be construed as granting to any licensee, and
licensee shall not receive, be deemed to have received or under any
circumstances claim to have received, whether

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expressly or implicitly, any title, easement, lien, possession or any property
interest in, or rights (in rem or otherwise) to, the Mortgaged Property or any
part thereof or anything contained therein.

(b)The Mortgagor will at all times promptly and faithfully perform, or cause to
be performed, all of the covenants, conditions and agreements contained in all
leases of the Mortgaged Property or any part thereof now or hereafter existing
on the part of the lessor thereunder to be kept and performed, and shall do all
things commercially reasonably necessary to compel performance by the lessee
under each lease of all obligations, covenants and agreements by such lessee to
be performed thereunder.  If any of such leases provide for the giving by the
lessee of certificates with respect to the status of such leases, the Mortgagor
shall exercise its right to request such certificates within five (5) business
days of any demand therefor by the Mortgagee.  The Mortgagor shall promptly
notify the Mortgagee of (i) the commencement of any action or proceeding by any
lessee, the purpose of which shall be the cancellation of any lease or
diminution or offset against the rent payable under any such lease, or (ii) the
interposition by any lessee of any defense in any action or proceeding brought
by the Mortgagor against such lessee, or (iii) a written notice received by the
Mortgagor from any lessee claiming constructive eviction, and will cause a copy
of any process, pleading or notice received by the Mortgagor in reference to any
such action, defense or claim to be promptly delivered to the Mortgagee.

(c)The Mortgagor shall furnish to the Mortgagee, within thirty (30) days after a
request by the Mortgagee to do so, a written statement containing a schedule of
all leases of all or any part of the Mortgaged Property, the names of the
respective lessees, the terms of their respective leases, the space occupied and
the rentals payable thereunder, and, if also requested, true copies of all such
leases.

5.18Payments by Mortgagee.  If Mortgagor shall fail to perform an act which it
is required to perform hereunder or any of the covenants contained herein or any
covenant contained in the Note, or fails to pay any money which it is required
to pay hereunder or under the Note, Mortgagee may, after notice to Mortgagor and
expiration of any applicable cure period (except in the event of emergency, in
which event no notice shall be required and no cure period shall apply), but
shall not be obligated to, make advances and/or disbursements to perform the
same, and all sums so advanced and/or disbursed shall bear interest at the
Default Rate from the date of such advance, and shall be a lien upon the
Mortgaged Property and be secured hereby.  Mortgagee, in making such advance or
payment, shall be subrogated to all the rights of the person receiving such
payment.  Mortgagor will repay on demand all sums so advanced and/or disbursed
with interest at the Default Rate from the date of making such advance and/or
disbursement until paid.  Any action taken by Mortgagee pursuant to this Section
shall not constitute a waiver of any Event of Default or an undertaking to
perform or complete any of the Mortgagor’s duties, nor shall it impose any
responsibility on Mortgagee to perform any of Mortgagor’s duties in the future.

5.19Mortgagee’s Inspection Requests.  Mortgagor will keep adequate records
and books of account in accordance with generally accepted accounting principles
(as defined by the American Association of Certified Public Accountants) and
will permit Mortgagee, by its agents, accountants and attorneys, to visit and
inspect the Mortgaged Property and examine its records and books of account with
respect to the Mortgaged Property (whether or not the same shall be kept at

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the Mortgaged Property) and to discuss its affairs, finances and accounts with
Mortgagor, at such reasonable times as may be requested by Mortgagee.  Mortgagor
shall deliver to Mortgagee annually, within one hundred twenty (120) days after
the end of Mortgagor’s fiscal year, a financial statement of the operation of
the Property, certified by the Mortgagor as true and correct.

5.20No Waste.  Mortgagor will not (i) threaten, commit, permit or suffer any
waste to occur on or to the Mortgaged Property or any part thereof, or (ii) make
any change in its use which will in any way (other than to a de minimis extent)
increase any fire or other hazards arising out of renovation or operation of the
Mortgaged Property.  Mortgagor will, at all times, maintain the Mortgaged
Property in good operating order and condition and will promptly make, from time
to time, all repairs, renewals, replacements, additions and improvements in
connection therewith which are needful to such end.  The Improvements shall not
be removed, demolished or substantially altered, nor shall any Fixtures and
Equipment be removed, without the prior written consent of Mortgagee except
where appropriate replacements, free of superior title, liens and claims, are
promptly made of value or utility at least equal to the value or utility of the
Fixtures and Equipment removed, or except where the Fixtures and Equipment are
obsolete or no longer useful, in which events Mortgagee shall be entitled to the
proceeds of the Fixtures and Equipment so removed.

5.21Mortgagee Litigation Expense.  Mortgagor agrees that if any action or
proceedings be commenced, excepting an action to foreclose this Mortgage or to
collect the indebtedness hereby secured, to which action or proceeding Mortgagee
is made a party by reason of the execution of this Mortgage or the Note which it
secures, or in which it becomes necessary to defend or uphold the lien of this
Mortgage, all sums paid by Mortgagee for the expense of any litigation to
prosecute or defend the transaction and the rights and lien created hereby
(including in every case reasonable attorneys’ fees and disbursements, and all
such sums incurred by Mortgagee in any appellate proceedings and any bankruptcy
or reorganization proceedings) shall be paid by Mortgagor together with interest
thereon from date of payment by Mortgagee at the Note Rate.  All such sums paid
and the interest thereon shall, at option of Mortgagee, be immediately due and
payable, shall be a lien upon the Mortgaged Property, and shall be secured
hereby as shall be all such sums incurred in connection with enforcement by
Mortgagee of its rights hereunder.

5.22Curing Violations.  Except for those violations disclosed in the Title
Report, Mortgagor will promptly cause to be dismissed any and all violations of
any federal, state or local laws, ordinances, or regulations affecting or
against the Mortgaged Property, but in any event all municipal violations shall
be dismissed prior to the date such violations would become a lien or
encumbrance against the Mortgaged Property.  The violations disclosed in the
Title Report are dealt with in the Undertaking signed by Mortgagor and delivered
to Mortgagee on this date.

5.23Leasing Covenants.  Supplementing Section 5.17 above as to all Leases and
Rents, comply with each of the following:

(a)accept no payments more than one month in advance of the due date under any
leases relating to the Mortgaged Property; and

(b)permit no use of the Mortgaged Property that would violate any provision of
this Mortgage, including all provisions relating to environmental matters; and

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(c)intentionally omitted; and

(d)intentionally omitted; and

(e)any existing or future lease, or other agreement for the use or occupancy, of
any Mortgaged Property shall provide that:

(i)it is subordinate and subject in all respects to the lien and provisions of
this Mortgage including all covenants and restrictions as to the use and
condition of the Mortgaged Property; and

(ii)all representations and covenants as to environmental matters, including
those set forth in Section 7, are to become express covenants and
representations of the tenant or occupant; and

(iii)copies of notices or letters asserting or discussing any defaults on the
part of the landlord shall be simultaneously sent to Mortgagee (attention: 
Commercial Loan Department) by certified mail; and

(iv)within fifteen (15) days of request by Mortgagee, the lessee or occupant
will deliver to Mortgagee a notarized statement as to the default status of any
lease or occupancy agreement and execute any document reasonably requested by
Mortgagee to confirm that any lease or occupancy agreement is subordinate and
subject to the lien and provisions of this Mortgage.

5.24Mortgage Tax.  At all times pay all required mortgage taxes for this
Mortgage, including at the time of original filing and at such time of any
supplements or amendments thereto.

5.25Service Contracts; Additional Liabilities.  Mortgagor shall not, without the
prior written consent of Mortgagee in each instance, such consent not to be
unreasonably withheld, enter into any service contracts or other agreements or
incur any other liability which would be binding upon a successor owner of the
Mortgaged Property or which would create a Mortgagor liability in excess of One
Hundred Thousand and 00/100 ($100,000.00) dollars, in each instance, except no
consent shall be required to enter into contracts for the performance of capital
improvements or repair work required by law and to be performed in accordance
with the Mortgage.

5.26Property Management.  The Mortgaged Property shall be managed at all times
by the Mortgagor or a manager that is approved by Mortgagee, which approval
shall not be unreasonably withheld.  Any manager, shall be a reputable
management company having substantial experience in the management of real
property of a similar type, size and quality in New York, New York and shall be
reasonably acceptable to Mortgagee.  Subject in all respects to this Section
5.26, Mortgagee agrees that Citadel Cinemas, Inc.  (the “Managing Agent”) is
acceptable as managing agent as of the date hereof and approves the Management
Agreement between Mortgagor and Managing Agent, as amended, copies of which have
been furnished to Mortgagee.  Mortgagor shall cause any manager of the Mortgaged
Property to agree that any management agreement shall be subject and subordinate
in all respects to the Loan and the lien of this Mortgage and the other Loan
Documents.  The management agreement may not be modified, amended, or terminated
by Mortgagor without Mortgagee’s prior written consent, which consent

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shall not be unreasonably withheld.  Mortgagor shall not consent to the
assignment or transfer by a manager of any of its rights or obligations under
its management agreement, without the prior written consent of Mortgagee, such
consent not to be unreasonably withheld.  Mortgagor shall not pay any management
fees with respect to the Mortgaged Property except as contemplated by a
management agreement reasonably acceptable to Mortgagee in all material
respects.  Such manager shall maintain a fidelity bond in an amount and with an
insurer reasonably acceptable to Mortgagee and in keeping with bond amounts
typically required by Mortgagee with respect to similarly situated properties in
Manhattan, New York.  Within sixty (60) days after receipt by Mortgagor of a
notice from Mortgagee, Mortgagor shall terminate any managing agent if, in the
reasonable judgment of Mortgagee, the management of the Mortgaged Property by
such managing agent may have an adverse material effect on the value of the
Mortgaged Property or on the ability of the Mortgagor to perform its obligations
under this Mortgage.

5.27Debt Service Coverage.  Mortgagor shall at all times maintain a minimum Debt
Service Coverage Ratio of at least 1.25:1.00, tested annually, commencing with
the calendar year ending December 31, 2020, “Debt Service Coverage Ratio” means
the ratio of (a) net income (which shall include, among other things, all rent
and additional rent payable under the Existing Lease, without deduction for the
expense represented by such rent and additional rent payable under the Existing
Lease) plus depreciation and amortization expense plus interest expense less
distributions to any person other than to an Affiliate of Guarantor; to (b) the
annual payments of principal and interest hereunder and under the Note.  Failure
to comply with the provisions of this paragraph, continuing within thirty (30)
days after notice, shall constitute an Event of Default under this Mortgage as
if such default were specifically listed in Section 8 hereof.  If, at any time,
a receiver is appointed with respect to all or any portion of the Mortgaged
Property, Mortgagor agrees that the order appointing the receiver may contain a
provision requiring the receiver to pay all debt service payments under any loan
evidenced by the Note and/or secured by this Mortgage, it being recognized that
such debt service payments are proper obligations of Mortgagor and must be paid
out of the rental charges payable under any leases.

5.28No Stay; Exemption or Moratorium.  The Mortgagor will not, except as, and in
such event only to the extent, required by law, at any time insist upon, or
plead, or in any manner whatsoever claim or take any benefit or advantage of any
stay or extension or moratorium law, any exemption from execution or sale of the
Mortgaged Property or any part thereof, wherever enacted, now or at any time
hereafter in force, which may affect the covenants and terms of performance of
this Mortgage, nor claim, take or insist upon any benefit or advantage of any
law now or hereafter in force providing for the valuation or appraisal of the
Mortgaged Property, or any part thereof, prior to any sale or sales thereof
which may be made pursuant to any provision herein, or pursuant to the decree,
judgment, or order of any court of competent jurisdiction, and covenants not to
hinder, delay or impede the execution of any power herein granted or delegated
to the Mortgagee, but to suffer and permit the execution of every power as
though no such law or laws had been made or enacted.  The Mortgagor for itself
and all who may claim under it, waives, to the extent that it lawfully may, all
right to have the Mortgaged Property or any part thereof marshaled upon any
foreclosure hereof.

5.29No Further Encumbrance.  Mortgagor shall not cause, or permit any lien or
encumbrance to be filed against, or attached to, the Mortgaged Property, other
than the lien of this Mortgage.

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5.30Reserve Account.  Mortgagor hereby covenants to open and maintain for the
term of the Loan with the Mortgagee an operating account in respect of the
Mortgaged Property.

﻿

Section 6 – INSURANCE

﻿

6.1Insurance Coverage.  Mortgagor shall keep or cause the tenant under the
Existing Lease to keep the Mortgaged Property insured as follows:

(a)Property Insurance.  Maintain extended coverage property insurance written in
the name of Mortgagor in the broadest “all risks” or “special form” causes of
loss available on a full replacement cost basis covering all Mortgaged Property,
including all Improvements and Fixtures and Equipment.  That insurance shall be
in amounts that are no less than the full replacement cost value of the
Mortgaged Property (without any deduction for depreciation) with a deductible
amount of no greater than $25,000.

(b)Liability Insurance.  Maintain commercial general liability insurance in the
name of Mortgagor, including contractual liability for an insured contract and
completed operations and personal injury coverage, with a combined single limit
for any one occurrence in amounts reasonably satisfactory to Mortgagee.

(c)Flood Insurance.  If any portion of the Mortgaged Property is located in a
flood hazard area in Special Flood Hazard Areas (Flood Zones prefixed in “A” or
“V”) for which insurance is available under the Flood Disaster Protection Act of
1973 or the National Flood Insurance Act of 1968, maintain flood insurance on
that portion in an amount reasonably acceptable to Mortgagee, not to exceed the
lesser of the full replacement cost value or the maximum coverage available
through the National Flood Insurance Program.

(d)Interruption Insurance.  Business interruption insurance for loss caused by
perils of the type covered by the above-referenced casualty insurance in amounts
as may be reasonably required by Mortgagee covering the loss of rental income
and all expenses and carrying costs of the Mortgaged Property for a period of
not less than one (1) year.

(e)Boiler and machinery insurance in amounts reasonably acceptable to Mortgagee.

(f)Policy Terms.  All policies shall meet the following requirements:

(i)overall blanket or excess coverage policies may be supplied provided,
however, that all insurance shall be in amounts sufficient to prevent any
insured from being a co-insurer and that the amount of the casualty insurance
coverage attributable to the Mortgaged Property is clearly set forth; and

(ii)all policies shall (x) name Mortgagee “and its successors and assigns as
their interests may appear” as “mortgagee insured” and “loss payee” on all
property insurance as outlined in clauses (a), (c), (d) and (e) above and as
“additional insured” as to general liability insurance, (y) contain an
endorsement

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stating that, as to the interest of Mortgagee, such policy “shall not be
impaired, invalidated or affected by any statement, act or neglect of any
insured, loss payee or other Person, or by any failure to make any report to the
insurer, or by the institution of any proceeding to execute upon any lien”, and
(z) contain a provision stating that such policy “shall not be canceled or
modified except after thirty (30) days prior written notice, except ten (10)
days prior written notice for non-payment of premium”, delivered to Mortgagee
(Attn:  Commercial Mortgage Department) at Mortgagee’s address first listed
above or as subsequently directed in writing by Mortgagee; and

(iii)all policies shall be in a form reasonably acceptable to Mortgagee and
shall be issued by financially sound insurers duly authorized to conduct that
type of insurance business in New York; and

(iv)all policies of insurance and endorsements thereof, together with a paid
receipt with respect to any installment(s) of premium(s) which shall be due
pursuant to any commercial premium finance agreement in effect with respect
thereto, shall be deposited with Mortgagee prior to the closing of this
Mortgage.  At least thirty (30) days prior to the expiration of any such
policies, Mortgagee shall furnish paid receipts and other evidence satisfactory
to Mortgagee that all such policies have been renewed or replaced; and

(v)all policies shall provide that the insurance proceeds and awards may be
adjusted only after obtaining the prior written consent of Mortgagee and shall
be paid directly to Mortgagee to the extent required in Section 6.2.

6.2Insurance Proceeds.  Mortgagee shall have the exclusive authority to do each
of the following in Mortgagee’s absolute discretion:

(a)Receive directly all Awards and Proceeds;

(b)Settle or compromise all claims relating to all Awards and Proceeds; and

(c)Determine whether to apply any Awards and Proceeds to reduce the Note or any
other Obligations or to repair or replace any Mortgaged Property.

Notwithstanding the foregoing, if the cost of restoration, as estimated by
Mortgagee in its sole discretion, does not exceed fifteen (15%) percent of the
then outstanding principal balance of the Loan, then, provided there then exists
no Event of Default or state of facts which with the giving of notice and
passage of time, or both, would become an Event of Default hereunder or under
any of the other Loan Documents, the Awards and Proceeds of such casualty loss
shall be made available for the restoration of the Mortgaged Property and in
such event shall not cause an acceleration, nor permit Mortgagee to accelerate,
the balance due under the Note.

Section 7 - ENVIRONMENTAL MATTERS

﻿

7.1Environmental Representations.  Except as otherwise expressly set forth in
the Environmental Report, Mortgagor hereby represents and warrants to Mortgagee
that:

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(a)Neither Mortgagor nor, to the best knowledge of Mortgagor, any other existing
or former occupant of the Mortgaged Property, has (i) Used any Hazardous
Substances in violation of any Environmental Law, (ii) received any notice, or
is on notice, of any claim, investigation, cleanup or testing program,
government expenditures, litigation or administrative proceeding, actual or
threatened, or any order, writ or judgment that relates to any Use of pollutants
of any kind, including any Hazardous Substances, on, or by any occupant of, the
Mortgaged Property.

(b)No Hazardous Substances have been, or will be, used on, or by any occupant of
the Mortgaged Property, other than common cleaning and maintenance agents in
small quantities for standard maintenance uses.

(c)No asbestos exists on the Mortgaged Property in any form, condition or
quantity.

7.2Restrictions on Hazardous Uses.  Without Mortgagee’s prior written consent,
which may be granted or withheld in Mortgagee’s sole discretion, Mortgagor shall
make or permit no use of the Mortgaged Property that would involve the Use of
any Hazardous Substances, except for properly stored safe cleaning and
maintenance agents in reasonable amounts for standard maintenance uses or as
specifically permitted in advance in writing by Mortgagee in its absolute
discretion.

7.3Notice to Mortgagee.  Mortgagor shall notify Mortgagee immediately in
writing upon learning of:

(a)any spill, discharge or release of any Hazardous Substances on or near the
Mortgaged Property that may involve a cleanup;

(b)any circumstances that may result in a violation of Section 7.2;

(c)any governmental inquiry or inspection is undertaken or an enforcement notice
issued with respect to Hazardous Substances on or Used with respect to the
Mortgaged Property.

7.4Environmental Audits.  If Mortgagee has reason to believe that there are
any Hazardous Substances on the Mortgaged Property and/or that Mortgagor has
breached any of the terms and conditions of this Section 7, Mortgagee may, as it
deems necessary in its sole discretion, conduct environmental assessments of the
Mortgaged Property from time to time, such audits and tests to be conducted by
an environmental consultant chosen by Mortgagee.  Mortgagor shall pay Mortgagee
on demand the reasonable costs of such audits or tests.  Any such environmental
assessments shall be considered the property of Mortgagee, and Mortgagee shall
owe no duty of confidentiality to Mortgagor with respect to the contents
thereof.  However, Mortgagor shall be provided with copies of all reports and
relevant correspondence.  It is hereby acknowledged by Mortgagor that Mortgagee
shall not vouch for or assume any responsibility for the scope of detail,
contents or accuracy of any such environmental assessment, and that neither
Mortgagor nor any other party shall have any recourse to or claim against
Mortgagee for any act of omission or commission of the environmental
consultant.  Mortgagor shall fully cooperate with the environmental consultant. 
Mortgagee may also from time to time, as it deems to be reasonably

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necessary and at the expense of Mortgagor, obtain legal advice from an attorney
competent in environmental law regarding the environmental condition of the
Mortgaged Property.  Mortgagee shall also have the right to require, from time
to time, but, provided there has occurred no Event of Default, not more
frequently than once per year, a certification by Mortgagor and any tenants of
the Mortgaged Property whether or not there has been any change(s) in the
environmental condition of the Mortgaged Property.

7.5Security for Cleanup.  If any investigation, environmental report or
governmental investigation or order indicates that there may exist any damage or
risk to the Mortgaged Property, or any liability of any Mortgagor relating to
any Hazardous Substances or other environmental conditions with respect to the
Mortgaged Property, Mortgagee may require Mortgagor to furnish immediately an
indemnity bond in an amount reasonably determined by Mortgagee, in its sole
discretion, to be sufficient to pay all actual and estimated cleanup costs and
to protect against any liens that are likely to arise with respect to such
potential cleanup costs.  Mortgagee’s demand that Mortgagor post any bond or
other security shall not be a waiver of any Event of Default or of any other
right or remedy available to Mortgagee.  Such obligation to post a bond shall
not apply during the last six (6) months of the term of the Loan, provided and
for so long as no Event of Default shall have occurred and be continuing.

7.6Indemnification.  Mortgagor shall fully indemnify, defend and hold harmless
Mortgagee, and its successors and assigns, from and against:  (a) any third
party claims involving Hazardous Substances on or affecting the Mortgaged
Property or any violation of Environmental Laws and (b) any fines, penalties,
reasonable attorney’s fees, sums paid in connection with any judicial or
administrative investigation or proceedings, costs of cleanup assessed by a
Governmental Authority, and all similar expenditures that relate in any way to
Mortgagor or the Mortgaged Property, without regard to whether Mortgagor would
have ultimately been responsible for such third party claims, fines, payments,
fees, sums or costs.  Any amounts that Mortgagor must pay to Mortgagee under
this Section 7.6 are payable upon demand and, if unpaid, shall bear interest per
annum, at the “Default Rate” (as defined in the Note) and such amounts, with
interest, shall be added to the Indebtedness.  The provisions of this Section
7.6 shall not be decreased or rendered ineffective in the event that Mortgagee
elects not to pursue its remedies to foreclose the Mortgage.  The liability of
Mortgagor and any other Obligor hereunder shall be joint and several and shall
survive the repayment of the Note and/or the release and/or assignment of the
Mortgage or Note or any Guaranty.

7.7Environmental Report.  Mortgagor has fully examined and considered
the Environmental Review of Merritt Environmental Consulting Corp.  dated April
29, 2016 in review of the Phase I Environmental Site Assessment dated June 12,
2012 prepared by Nova Consulting Group, Inc. for Sovereign Santander
(collectively, the “Environmental Report”) and has no actual knowledge of any
environmental condition on or affecting the Mortgaged Property which is not set
forth in such report.

Section 8 - EVENTS OF DEFAULT

﻿

Any of the following events or conditions shall, at the option of Mortgagee,
constitute an “Event of Default” under this Mortgage and the other Loan
Documents and Obligations if not cured within the applicable cure period, if
any, set forth below:

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8.1Payments.  Any failure to make on its due date any payment required to be
made by Mortgagor under this Mortgage, the Note or any other Loan Document or
Obligations (and any applicable grace, notice or cure period as to such payment
set forth in that Loan Document shall have expired); or

8.2Other Terms.  Any failure to perform or observe any non-monetary term
or condition (not otherwise recited under this Section 8) under this Mortgage,
the Note or any other Loan Document or Obligations which continues for thirty
(30) days after notice thereof by the Mortgagee to the Mortgagor, provided,
however, that if such default is capable of cure, but with due diligence cannot
be cured within such thirty (30) day period and Mortgagor has promptly commenced
to cure within such period and continuously pursues same diligently and
expeditiously, then such period to cure shall be extended for so long as is
reasonably necessary for Mortgagor in the exercise of due diligence to cure such
default, it being agreed that no such extension shall be for a period in excess
of one hundred twenty (120) days (subject to further extension by Mortgagee, in
Mortgagee’s sole discretion); or

8.3Representations.  Any representation, statement or warranty made by or on
behalf of any Obligor in this Mortgage, the Affidavit of Title or any other Loan
Document, certificate or other writing made or given to Mortgagee at any time
shall be incorrect, incomplete or misleading when made in any material respect;
or

8.4Failure to Obtain Permission.  Mortgagor shall do, or permit to be done, any
act for which Mortgagee’s consent is required under this Mortgage or any other
Loan Document without first obtaining such consent in writing (except in the
event of emergency); or

8.5Financial Information and Inspections.  Any failure to furnish financial
information which continues for thirty (30) days after notice thereof or to
permit inspection of the Mortgaged Property or any records as required under
this Mortgage or any other Loan Document; or

8.6Failure to Maintain Insurance.  Any failure to maintain, or provide, within
five (5) business days after notice, satisfactory evidence of, any insurance
coverage required under this Mortgage or any other Loan Document; or

8.7Lien Defaults or Foreclosures.  Any default or modification (without
Mortgagee’s prior written consent) shall have occurred in any mortgage,
assignment, encumbrance or agreement constituting a Permitted Encumbrance, and
any applicable cure period as to such default shall have expired, or proceedings
shall have been instituted or actions taken for the foreclosure or enforcement
of any mortgage, judgment, assignment or other lien or encumbrance affecting the
Mortgaged Property and such proceedings have not been dismissed with prejudice
within thirty (30) days after the commencement thereof; or

8.8Warrants and Tax Liens.  Any warrant of attachment or for distraint, or
notice of tax or other lien shall be issued relating to, or encumbering, any
portion of the Mortgaged Property that is not discharged, or stayed and bonded,
to the reasonable satisfaction of Mortgagee within thirty (30) days of notice of
entry; or

8.9Judgments.  Any judgment that would adversely affect in any material respect
Mortgagor’s ability to perform any obligations under any of the Loan Documents
or the value of

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the Mortgaged Property or any other collateral under any of the Loan Documents
shall be entered against Mortgagor that is not (a) within thirty (30) days of
entry, discharged, or stayed and bonded, to the reasonable satisfaction of
Mortgagee or (b) fully covered by insurance and the insurance company has
unconditionally accepted liability for that judgment; or

8.10Loss of Collateral.  There occurs any casualty on, or loss or destruction
of, any Mortgaged Property that, in Mortgagee’s reasonable judgment, involves
material damage to or loss of property, unless such loss or destruction is fully
covered by insurance (subject to a standard insurance policy deductible
provision of $25,000 or less) to the reasonable satisfaction of Mortgagee; or

8.11Hazardous Substances.  There occurs, or it is found that there has
previously occurred, any Use of any Hazardous Substances on the Mortgaged
Property or by Mortgagor that will require Mortgagor to remedy and the cost of
such remedy shall exceed $125,000; or

8.12Insolvency.  Any filing of a petition by or against any Obligor under any
bankruptcy or insolvency law or an assignment by any Obligor of any property or
assets for the benefit of creditors, or the failure of any Obligor to pay debts
in the ordinary course as those debts become due, or the calling of a meeting of
creditors of any Obligor to obtain any general financial accommodation provided,
however, that any Obligor shall have sixty (60) days to obtain a court order
dismissing any bankruptcy or insolvency proceeding that is filed without consent
of the debtor; or

8.13Seizure of Property.  Any seizure by governmental authorities of, or the
imposition of legal restraints against, the Mortgaged Property, which is not,
within thirty (30) days of such seizure or imposition, released, discharged or
fully bonded to the reasonable satisfaction of Mortgagee; or

8.14Non-Permitted Encumbrance.  Any mortgage, assignment, lien, judgment or
interest shall encumber any Mortgaged Property with the exception of any
Permitted Encumbrances which shall not be discharged within thirty (30) days
after notice thereof; or

8.15Default in Leases.  Any material default on the part of Mortgagor shall
occur under or there shall be a termination of any leases that presently or may
in the future affect the Mortgaged Property and account for more than five
percent (5%) of the annual rentals from the Mortgaged Property or result in a
failure to maintain the required Debt Service Coverage Ratio; or

8.16Dissolution.  Any Obligor shall fail to remain in good standing in its state
of incorporation or organization or dissolves or ceases to exist; or

8.17Adverse Change.  Any adverse change in the creditworthiness or financial
condition of any Obligor that, in the reasonable opinion of Mortgagee,
materially increases Mortgagee’s risk; or

8.18Legal Changes.  Any laws are enacted whereby there is a change which deducts
the value of land or a change in taxation of mortgages and Mortgagor fails to
enter into a reasonably satisfactory agreement with Mortgagee; or

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8.19Entry.  If Mortgagee or its representatives are not permitted, at all
reasonable times, to enter upon the Property and to inspect the Improvements and
Fixtures and Equipment in accordance with the terms and provisions of this
Mortgage; or

8.20Other Obligations.  If the Mortgagor shall default beyond applicable grace
and notice periods in the payment of any other indebtedness owed to Mortgagee or
default under the terms of any Loan Document between Mortgagor and Mortgagee; or

8.21Transfer or Hypothecation.  If Mortgagor or any interest in the Mortgagor is
pledged, hypothecated, levied upon, encumbered, assigned or transferred (by
operation of law or otherwise) in any manner, without the prior written consent
of Mortgagee; or

8.22Easements.  If any easement over, across, under or otherwise affecting the
Mortgaged Property or any portion thereof shall be granted or released by
Mortgagor without the Mortgagee’s prior written consent except that Mortgagor
may grant utility and other usual easements reasonably necessary for its use of
the Mortgaged Property for their intended purposes; or

8.23Other Debts.  If the Mortgagor shall default beyond applicable grace periods
(as principal or surety) on any indebtedness for borrowed money or otherwise in
an amount in excess of $125,000.00 in any one case or in the aggregate; or

8.24Additional Borrowings.  Except as otherwise expressly set forth in this
Mortgage, other than unsecured credit extensions or unsecured borrowings between
Mortgagor and Affiliates, if the Mortgagor shall borrow funds or obtain credit,
whether on a secured or unsecured basis, without the express written consent of
Mortgagee, which consent may be granted or withheld in the Mortgagee’s sole
discretion.

Section 9 – REMEDIES

﻿

9.1Remedies.  Upon the occurrence of an Event of Default, Mortgagee may, at its
option, do any of the following in any order at any time and in any combination:

(a)Acceleration of Obligations.  Declare all principal, interest and expenses
outstanding under the Note, this Mortgage and any other Obligations to be
immediately due and payable in full; or

(b)Foreclosure.  Institute proceedings to foreclose on all or any portion of the
Mortgaged Property, and following receipt of a judgment of foreclose, cause the
sale of the Mortgaged Property in accordance with applicable law, in one or
several parcels, at Mortgagee’s option; or

(c)Receiver.  Appoint a receiver of the rents, profits, leases, income and
refunds arising from the Mortgaged Property without the necessity of proving
either the inadequacy of the security or insolvency of any Obligor, and each
Obligor does hereby waive such proof and consent to the appointment of a
receiver; Mortgagee shall be entitled to the appointment of a receiver as a
matter of right in accordance with Section 254 of the New York Real Property
Law; or

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(d)Absolute Assignment of Rents.  With or without instituting proceedings to
foreclose on, or appoint a receiver for, the Mortgaged Property, revoke
Mortgagor’s license to collect rents and exercise all of Mortgagee’s remedies
under the Assignment of Rents and Leases from Mortgagor to Mortgagee of even
date, including, without limitation, the right to notify tenants of the
Mortgaged Property to pay rents directly to Mortgagee, take possession of and
rent the Mortgaged Property, either in Mortgagee’s name or in the name of the
owner of such Mortgaged Property, receive and apply the rents and profits, after
the payment of any collection, operating and management expenses, including
management commissions and reasonable attorney’s fees and disbursements, against
the Note and other Obligations, being accountable only for the rents and profits
that are actually received by it while in possession; or

(e)UCC Remedies.  Exercise all rights and remedies available to a secured party
under the New York Uniform Commercial Code as in effect from time to time; or

(f)Collection Action.  Institute a collection action directly against any
Obligor, either without acceleration for the balance of any Obligations then
past due or, following acceleration, for all Obligations; or

(g)Freeze; Setoff.  Hold, apply, freeze or set-off (without notice)on account of
any Obligations, funds of any Obligor on deposit with Mortgagee in any account,
fund or certificate, any indebtedness that Mortgagee may owe to any Obligor or
any other tangible or intangible property owned by any Obligor that may be in
the possession or under the control of Mortgagee; or

(h)Increase in Interest Rate.  Increase the rate of interest under any
Obligation, including, without limitation, the Note, to a rate five (5)
percentage points above the Note Rate This increase shall be retroactive to the
date of the first occurrence of an Event of Default, shall be computed on the
basis of actual days elapsed over a 360‑day year and shall survive entry of any
judgment relating to the Loan; or

(i)Other Remedies.  Exercise any other rights and remedies available under this
Mortgage, any other Loan Document, Obligations or other document or agreements
of any kind, or that are available at law or in equity, including, without
limitation, all rights set forth in Section 254 of the New York Real Property
Law and in Article 14 of the New York State Real Property Actions and
Proceedings Law allowing for Power of Sale; or

(j)Proceeds.  Apply proceeds of any sale of the Mortgaged Property first to
costs and expenses of liquidation, sale or collection, including any reasonable
attorneys’ fees and disbursements and then to payment of any Obligation in
whatever order Mortgagee may, in its discretion, elect, with the remaining
proceeds, if any, to be paid to Mortgagor; or

(k)Expenses.  Collect all of the collection expenses permitted under Section 10
of this Mortgage or otherwise permitted under law and have the amount of such
expenses, together with all prepayment penalties due pursuant to the Note, which
penalties shall be computed pursuant to the terms thereof and treating
prepayment as occurring on the date

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of default, included in any judgment or decree obtained by Mortgagee, to the
extent permitted by law.

9.2Authorization of Mortgagee.  Mortgagor irrevocably appoints Mortgagee the
true and lawful attorney in fact coupled with an interest of Mortgagor, in its
name and on its behalf, for the purpose of effectuating any sale, assignment,
transfer or delivery for the enforcement hereof, whether pursuant to power of
sale, foreclosure or otherwise, to execute and deliver all such deeds, leases,
bills of sale, assignments, releases and other instruments as may be necessary,
with full power of substitution, provided that Mortgagor shall not exercise its
rights under this Section 9.2 prior to the occurrence of an Event of Default.

9.3Purchase by Mortgagee.  Mortgagee may be a purchaser of the Mortgaged
Property or of any party thereof or of any interest therein at any sale thereof,
whether pursuant to foreclosure or otherwise, and may apply the purchase price
thereof to the Obligations.  Mortgagee shall, upon any such purchase, acquire
good title to the Mortgaged Property so purchased, free of the lien of this
Mortgage and free of all rights of redemption in Mortgagor.

Section 10 - COLLECTION EXPENSES

﻿

If Mortgagee employs counsel for advice or representation after an Event of
Default (whether or not formally declared) relating to the collection or
enforcement of this Mortgage, the Note, or any other Loan Document or
Obligations (whether or not suit is actually instituted), Mortgagee may collect
from any Obligor all of Mortgagee’s reasonable expenses and fees including (a)
all fees and disbursements of Mortgagee’s counsel and (b) all expenses of, or in
anticipation of, litigation including fees and expenses of witnesses, experts,
stenographers, title and lien searches and appraisals.  All those collection
fees and expenses shall be due and payable upon demand, shall bear interest at
the Default Rate in effect from time to time under the Note and shall become
Obligations secured by this Mortgage and any other collateral that secures any
Obligations.

Section 11 - MORTGAGEE’S PERFORMANCE

﻿

If Mortgagor fails to perform any duty or obligation imposed upon Mortgagor
under this Mortgage or any other Loan Document when due, Mortgagee may, after
notice to Mortgagor and expiration of any applicable cure period (except in the
event of emergency, in which event no notice shall be required and no cure
period shall apply), at its option (with or without declaring an Event of
Default), perform any such duty or obligation including payment of any tax,
governmental charge or insurance premium, making repairs to the Mortgaged
Property, rendering it free of any Hazardous Substances or liens or performing
any lease obligation.  The out-of-pocket expenses incurred by Mortgagee in
performing any of the Mortgagor’s duties or obligations shall be added to the
monies owing under the Note, with interest at the rate in effect from time to
time under the Note, and shall be secured by this Mortgage and by all collateral
given to secure any Obligations.  Any action taken by Mortgagee pursuant to this
Section shall not constitute a waiver of any Event of Default or an undertaking
to perform or complete any of the Mortgagor’s duties, nor shall it impose any
responsibility on Mortgagee to perform any of Mortgagor’s duties in the future.

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Section 12 - SECURITY AGREEMENT

﻿

12.1Mortgagor hereby grants Mortgagee a security interest, under the Uniform
Commercial Code as enacted in the State of New York, in all of the Mortgagor’s
right, title and interest in and to all existing and future-acquired Fixtures
and Equipment, Awards and Proceeds, Leases and Rents, Other Rights, and all tax
and insurance escrows held by Mortgagee pursuant to this Mortgage.  In order to
perfect the security interests granted hereunder, this Mortgage shall be filed
in the appropriate state real property records, Mortgagor, as debtor, hereby
authorizes Mortgagee to execute UCC-1 financing statements in favor of
Mortgagee, as secured party, which statements shall be filed with all
appropriate county filing offices.

12.2If any Event of Default shall occur, the Mortgagee shall have, in addition
to any and all other rights and remedies set forth in this Mortgage, and may
exercise without demand, any and all rights and remedies granted to a secured
party under the Code, including, but not limited to, the right to take
possession of the Other Rights, Fixtures and Equipment, Awards and Proceeds,
Leases and Rents, and all tax and insurance escrows held by Mortgagee, or any
part thereof, and the right to advertise and sell the Fixtures and Equipment and
the Other Rights, or any part thereof, pursuant to and in accordance with the
power of sale provided for in this Mortgage.  The Mortgagor agrees that any
notice of public or private sale or other action intended by the Mortgagee with
respect to the Fixtures and Equipment and the Other Rights, or any part thereof,
shall, to the extent permitted by law, constitute reasonable notice if it is
sent to the Mortgagor not less than ten (10) days prior to any such sale or
intended action.  The proceeds of any such sale of the Fixtures and Equipment
and the Other Rights, or any part thereof, shall be applied in the manner set
forth in Article II of this Mortgage.

Section 13 - ABSOLUTE ASSIGNMENT OF LEASES AND RENTS

﻿

This Mortgage also serves as an absolute assignment of all existing and future
rentals, leases, profits, income, revenues and proceeds arising from the
Mortgaged Property as provided and set forth in the Assignment of Rents and
Leases from Mortgagor to Mortgagee of even date, provided, however, that so long
as there is no Event of Default, Mortgagor shall be granted a revocable license
from Mortgagee to remain in possession of, and to collect all rentals arising
from, the Mortgaged Property, and to exercise the rights of landlord
thereunder.  This assignment shall not, however, render Mortgagee responsible
for the performance of any duties under any lease, nor for any negligence in the
management, operation or maintenance of the Mortgaged Property or for any
resulting damage, loss or injury.  The receipt by Mortgagee of any rentals or
profits pursuant to this assignment shall not cure any Event of Default or
affect any foreclosure or other liquidation proceeding that may be pending at
any time.  Mortgagor hereby irrevocably appoints Mortgagee as Mortgagor’s
attorney-in-fact to exercise all rights and remedies of Mortgagor as landlord
and manager of the Mortgaged Property, provided, however, that Mortgagee agrees
not to exercise such rights and remedies until the occurrence of an Event of
Default.

Section 14 – MODIFICATIONS

﻿

This Mortgage is subject to modification.  To the extent permitted by law, this
Mortgage secures all modifications from the date upon which this Mortgage was
originally recorded,

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including future loans and extensions of credit and changes in the interest
rate, due date, amount or other terms and conditions of any Obligations.

Section 15 – MISCELLANEOUS

﻿

15.1Further Assurances; Corrections.  Mortgagor shall, within ten (10) days of
Mortgagee’s request, execute any documents, provide any lien or other searches,
and do anything that Mortgagee determines to be reasonably necessary to
establish, perfect, assure or maintain the existence and priorities of,
Mortgagee’s liens against the Mortgaged Property, the reasonable costs of so
doing be paid by Mortgagor.  In case of the occurrence of any errors in the
execution of the Loan Documents, Mortgagor authorizes Mortgagee to make all
necessary corrections in order to cause the Loan Documents to conform to the
terms and conditions agreed to by Mortgagor and Mortgagee.

15.2Notices.  All notices, demands, requests, consents and other communications
shall be in writing and served by hand delivery, by certified mail, return
receipt requested, or by a recognized overnight delivery service, if to
Mortgagee, to the address set forth in the caption of this Mortgage, with a copy
in like manner to Romer Debbas LLP, 275 Madison Avenue, Suite 801, New York, New
York 10016, Attn:  Hugh P. Finnegan, Esq., and if to Mortgagor, to Mortgagor at
the address set forth in the caption of this Mortgage, with a copy in like
manner to Marcus Rosenberg & Diamond LLP, 488 Madison Avenue, 17th Floor, New
York, New York 10022, Attn:  Jeffrey M. Diamond, Esq., unless proper written
notice has been given to all other parties of any change in address.  Notices
and other written communication shall be deemed to have been properly served
upon delivery to the designated address provided, however, that any notice or
other communication sent by certified mail, return receipt requested, shall be
deemed to have been properly served on the third business day after mailing,
regardless of when it is actually received.

15.3No Jury Trial.  MORTGAGOR HEREBY WAIVES ANY RIGHT TO REQUEST A TRIAL BY JURY
IN ANY LITIGATION WITH RESPECT TO ANY ASPECT OF THIS MORTGAGE OR ANY OTHER LOAN
DOCUMENT AND REPRESENTS THAT MORTGAGOR HAS CONSULTED WITH COUNSEL SPECIFICALLY
AS TO THIS WAIVER.  BY ACCEPTING THIS MORTGAGE, MORTGAGEE ALSO WAIVES ITS RIGHT
TO REQUEST A TRIAL BY JURY.

15.4No Waivers.  Mortgagee shall not be deemed to have waived any of its rights
or remedies under this Mortgage or any other Loan Document by:

(a)forbearing or failing to exercise, or delaying in exercising, any rights and
remedies; or

(b)forbearing or failing to insist upon, or delaying in insisting upon, the
strict performance of any term or condition of this Mortgage or any other Loan
Document;

(c)granting any extension, modification or waiver of any term or condition of
this Mortgage or any other Loan Document, except to the extent expressly
provided in any written extension, modification, or waiver; or

23

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(d)any other act, omission, forbearance or delay by Mortgagee, its officers,
agents, servants or employees; or

(e)any waiver of any rights or remedies on any one occasion.

15.5Collection Duties.  Mortgagee shall be under no duty or obligation to:

(a)preserve, protect or marshal any Mortgaged Property or other collateral for
any Obligations; or

(b)preserve or protect any rights in any Mortgaged Property or other Collateral
against any person claiming an interest adverse to that of Mortgagor; or

(c)realize upon any Mortgaged Property or other collateral in any particular
order or manner or seek repayment of any Obligations from any particular source.

15.6Waiver of Defense.  Mortgagor hereby waives any defense based on the failure
to name any tenant or occupant of the Mortgaged Property as a defendant in any
foreclosure action or other litigation with respect to this Mortgage.

15.7Written Changes Only.  No change, extension, modification, amendment or
waiver of any term or condition of this Mortgage or any other Loan Document
shall be valid or binding upon any party hereto, unless it is in writing and has
been executed by duly authorized officer of such party.

15.8Correction of Documents.  If any Loan Documents contain an error or
incorrect terms or were improperly prepared or executed, or if a document
intended to constitute part of the Loan Documents was inadvertently omitted,
then in each such case Mortgagor agrees to execute proper documents promptly.

15.9Successors and Assigns.  This Mortgage shall be binding upon Mortgagor and
its successors and assigns, and inure to the benefit of Mortgagee, and its
successors and assigns.

15.10Governing Law and Jurisdiction.  This Mortgage has been executed and
delivered in the State of New York; all terms of this Mortgage shall be governed
by and construed according to the laws of the State of New York since the
premises are located in the State of New York.  All terms of the other Loan
Documents shall be governed by and constructed according to the Laws of the
State of New York.  Mortgagor and Mortgagee each hereby consents to personal
jurisdiction in the State of New York with respect to any and all matters
arising under or relating to this Mortgage and all other Loan Documents. 
SUBJECT TO THE REQUIREMENTS FOR A CASE TO BE HEARD IN THE COMMERCIAL DIVISION OF
THE NEW YORK STATE SUPREME COURT, THE PARTIES AGREE TO SUBMIT TO THE EXCLUSIVE
JURISDICTION OF THE COMMERCIAL DIVISION OF THE NEW YORK STATE SUPREME COURT, AND
TO THE APPLICATION OF SAID COURT’S ACCELERATED PROCEDURES PURSUANT TO RULE 9 OF
SECTION 202.70(G) OF THE UNIFORM RULES FOR NEW YORK STATE TRIAL COURTS.

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15.11Partial Invalidity.  If any term or provision of this Mortgage is at any
time held to be invalid by any court of competent jurisdiction, that invalidity
shall not affect the remaining terms and provisions of this Mortgage, which
shall continue to be in full force and effect.

15.12Receipt of Copies.  Mortgagor hereby acknowledges receipt of a true copy of
this Mortgage, the Note and the other Loan Documents without charge.

15.13Intentionally Omitted.

15.14Cross Default.  The occurrence of an Event of Default shall constitute a
default under any other Obligations of Mortgagor and a default under any other
Obligations of Mortgagor shall constitute an Event of Default under the Note,
this Mortgage and all other Loan Documents.

15.15Intentionally Omitted.

15.16Satisfaction or Assignment of Mortgage.  Upon the payment in full of all
amounts due under, evidenced or secured by this Mortgage and the payment of a
reasonable attorney fee for the preparation of a Satisfaction of Mortgage, the
Mortgagee shall only be required to deliver a satisfaction instrument, and not
an assignment.  However, if permitted by applicable laws, including without
limitation, Section 275 of the Real Property Law of the State of New York, upon
no less than twenty (20) days prior written notice, Mortgagor may request that,
and subject to this paragraph, Mortgagee shall, upon the final and indefeasible
repayment in full (except by reason of foreclosure of the lien of this Mortgage)
of the Obligations, Mortgagee prepare and deliver, at Mortgagor’s expense, to
the person or entity making such payment, an assignment, without recourse,
representation or warranty, of Mortgagee’s right, title, and interest in the
Note and this Mortgage.  Mortgagee’s agreement to provide said assignment shall
be subject only to the Mortgagor’s payment of Mortgagee’s assignment fee, at the
time of such assignment, not to exceed $2,500.00, Mortgagee’s reasonable legal
fees, including attendance at closing, if necessary, at the customary hourly
rates of Mortgagee’s counsel, and any other out-of-pocket expenses incurred by
Mortgagee in connection with the assignment.  Mortgagee’s agreement to provide
said assignment shall not be deemed to impose any liability or obligation on
Mortgagee in the event any of the original notes and/or mortgages shall be lost
or misplaced other than to provide a lost note affidavit.

15.17Mortgage Commitment.  The terms and provisions of the Commitment Letter are
incorporated herein by reference and shall survive the closing of the Loan.  In
the event the terms of the Commitment Letter are inconsistent with the
provisions of this Mortgage, the terms and provisions of this Mortgage shall
govern.

15.18Usury.  In the event that Mortgagee, in enforcing its rights hereunder,
determines that charges and fees incurred in connection with the Loan may, under
the laws of the State of New York, cause the interest rate herein to exceed the
maximum allowed by law, then such interest shall be recalculated and any excess
over the maximum interest permitted by said laws shall be credited to the then
outstanding principal balance to reduce said balance by that amount.  It is the
intent of the parties hereto that Mortgagor under no circumstances shall be
required to pay, nor shall Mortgagee be entitled to collect, any interest which
is in excess of the maximum legal rate permitted under the laws of the State of
New York.

25

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15.19Maximum Amount Secured.  Notwithstanding anything contained herein to the
contrary, the maximum amount of indebtedness secured by this Mortgage at
execution or which under any contingency may become secured hereby at any time
hereafter is TWENTY-FIVE MILLION AND 00/100 DOLLARS ($25,000,000.00), plus
interest thereon, plus all amounts expended by the Mortgagee after default by
the Mortgagor which constitute payment of (i) taxes, charges or assessments
which may be imposed by law upon the Property; (ii) premiums on insurance
policies covering the Property; (iii) expenses incurred in protecting or
upholding the lien of this Mortgage, including, but not limited to the expenses
of any litigation to prosecute or defend the rights and lien created by this
Mortgage; (iv) expenses incurred in protecting the collateral encumbered by this
Mortgage; or (v) any amount, cost or charge to which the Mortgagee becomes
subrogated upon payment, whether under recognized principles of law or equity,
or under express statutory authority.

15.20Mortgagee’s Consent and Approval.  If Mortgagor shall request Mortgagee’s
consent or approval pursuant to any of the provisions of this Mortgage or
otherwise, and Mortgagee shall fail or refuse to give, or shall delay in giving,
such consent or approval, Mortgagor shall in no event make, or be entitled to
make, any claim for damages (nor shall Mortgagor assert, or be entitled to
assert, any such claim by way of defense, set off, or counterclaim) based upon
any claim or assertion by Mortgagor that Mortgagee unreasonably withheld or
delayed its consent or approval, and Mortgagor hereby waives any and all rights
that it may have from whatever source derived, to make or assert any such
claim.  Mortgagor’s sole remedy for any such failure, refusal, or delay shall be
an action for a declaratory judgment, specific performance, or injunction, and
such remedies shall be available only in those instances where Mortgagee has
expressly agreed in writing not to unreasonably withhold or delay its consent or
approval or where, as a matter of law, Mortgagee may not unreasonably withhold
or delay the same.

Section 16 - INTENTIONALLY OMITTED

﻿

Section 17 - NEW YORK STATE SPECIFIC PROVISIONS

﻿

17.1Real Property Law.  All covenants contained in this Mortgage, which are in
addition to those set forth in Sections 254 and 291-F of the Real Property Law
shall be construed as affording to Mortgagee rights additional to, and not
exclusive of, the rights conferred under the provisions of said Sections 254 and
291-f of the Real Property Law.

17.2Lien Law.  In compliance with Section 13 of the New York Lien Law, the
Mortgagor will receive the advances secured by this Mortgage and will hold such
advances in trust, to be applied first for the purpose of paying the cost of any
improvements heretobefore made or now being made on, in and under the premises
hereby mortgaged and will apply the same first payment of the cost of
improvements before using any part of the total of the same for any other
purpose.

17.3Costs, Expenses and Attorneys’ Fees.  Should one or more Events of Default
occur under this Mortgage or the Loan Documents, and should an action be
commenced for the foreclosure of this Mortgage, Mortgagee shall be entitled to
recover all sums due hereunder, statutory costs, and additional allowances made
pursuant to Section 8303(a) of the Civil Practice Laws and Rules of the State of
New York, and addition thereto, reasonable attorneys’ fees in such

26

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proceeding, and such amount shall be added to the principal balance and interest
then due and shall be a lien on the Mortgaged Property prior to any right or
title to, interest in or claim upon the Mortgaged Property attaching and
accruing subsequent to the lien of this Mortgage, and shall be deemed to be
secured by this Mortgage, and the indebtedness which it secures.

17.4Intervening Liens.  Should any agreement be hereafter entered into modifying
or changing the terms of this Mortgage or the Note in any manner, the rights of
the parties to such agreement shall be superior to the rights of the holder of
any intervening lien.

17.5Time is of the Essence.  Time is of the essence with respect to each and
every covenant, agreement and obligation of Mortgagor under this Mortgage, the
Note and any and all other Loan Documents.

17.6Terms.  It is understood that the words “Mortgagor” and “Mortgagee” herein
shall include their respective heirs, successors and assigns of Mortgagor and
Mortgagee.

17.7Entire Agreement.  This Mortgage and the other Loan Documents, constitute
the entire understanding between Mortgagor and Mortgagee and to the extent that
any writings not signed by Mortgagee or oral statements or conversations at any
time made or had shall be inconsistent with the provisions of this Mortgage or
the other Loan Documents, the same shall be null and void

17.8Tax Law Section 253 Statement.  This Mortgage does not cover real property
principally improved or to be improved by one or more structured containing in
the aggregate not more than six (6) residential dwelling units, each having
their own separate cooking facilities.

17.9Nonjudicial Foreclosure.  To the extent permitted by law, Mortgagee may
choose to utilize the procedures set forth in Article 14 of the Real Property
Actions and Proceedings Law of New York to commence a non-judicial foreclosure
of this Mortgage by power of sale.  To the extent permitted by law, Mortgagor
waives any right granted pursuant to Section 1421 or any other provision of the
Real Property Actions and Proceedings Law of New York to challenge
the Mortgagee’s election to enforce this Mortgage by means of such non-judicial
foreclosure by power of sale.  If the Mortgaged Premises consists of two or more
distinct parcels, all of such parcels shall be sold as one parcel, unless
Mortgagee shall elect otherwise.

[The balance of this page has been intentionally left blank]

 

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IN WITNESS WHEREOF this mortgage has been duly executed by the Mortgagor.

﻿

,
a Nevada limited liability company

Citadel Cinemas, Inc.,
a Nevada corporation,
its Manager

/s/ Gilbert Avanes
Name:  Gilbert Avanes
Title:  EVP, Chief Financial Officer and Treasurer

 

﻿

MORTGAGOR:

SUTTON HILL PROPERTIES, LLC,
a Nevada limited liability company

By:Citadel Cinemas, Inc.,
a Nevada corporation,
its Manager

By:       /s/ Gilbert Avanes

Name:  Gilbert Avanes

Title:    EVP, Chief Financial Officer and Treasurer

﻿

UNIFORM FORM CERTIFICATE OF ACKNOWLEDGMENT
(Outside of New York State)

State, District of Columbia, Territory, Possession, or Foreign Country

State of

)

﻿

) ss.:

County of

)

﻿

On the _____ day of March in the year 2020 before me, the undersigned,
personally appeared Gilbert Avanes personally known to me or proved to me on the
basis of satisfactory evidence to be the individual(s) whose name(s) is(are)
subscribed to the within instrument and acknowledged to me that he/she/they
executed the same in his/her/their capacity(ies), that by his/her/their
signature(s) on the instrument, the individual(s), or the person upon behalf of
which the individual(s) acted, executed the instrument, and that such
individual(s) made such appearance before the undersigned in the
______________________________________________________________________________
(insert city or other political subdivision and state or country or other place
the acknowledgment was taken).

﻿

 

﻿

 

(signature and office of individual taking acknowledgment)

﻿

 

 

--------------------------------------------------------------------------------

 

﻿

CALIFORNIA ALL-PURPOSE
ACKNOWLEDGMENT                                                    CIVIL CODE §
1189

﻿

﻿

A notary public or other officer completing this certificate verifies only the
identity of the individual who signed the document to which this certificate is
attached, and not the truthfulness, accuracy, or validity of that document.

﻿

)

 

State of California______________________)

County of ____________________________)

 

﻿

﻿

 

 

On ___________________ before me, /s/ Michael James Conroy “as Notary Public”,

DateHere Insert Name and Title of the Officer

personally appeared /s/ Gilbert Avanes

Name(s) of Signer(s)

who proved to me on the basis of satisfactory evidence to be the person(s) whose
name(s) is/are subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their authorized capacity(ies), and
that by his/her/their signature(s) on the instrument the person(s), or the
entity upon behalf of which the person(s) acted, executed the instrument.

﻿

I certify under PENALTY OF PERJURY under the laws of the State of California
that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature /s/ Michael James Conroy

Signature of Notary Public

﻿

Place Notary Seal Above

﻿

OPTIONAL

 

Though this section is optional, completing this information can deter
alteration of the document or fraudulent reattachment of this form to an
unintended document.

Description of Attached Document

Title or Type of Document:  ___________________ Document Date: 
___________________________

Number of Pages:  ______ Signer(s) Other Than Named Above: 
_________________________________

Capacity(ies) Claimed by Signer(s)

Signer’s Name:  __________________________

☐ Corporate Officer — Title(s):  ______________

☐ Partner — ☐ Limited ☐ General

☐ Individual☐ Attorney in Fact

☐ Trustee☐ Guardian or Conservator

☐ Other:  ______________________________

Signer Is Representing: _________________________

_____________________________________

Signer’s Name:  __________________________

☐ Corporate Officer — Title(s):  ______________

☐ Partner — ☐ Limited ☐ General

☐ Individual☐ Attorney in Fact

☐ Trustee☐ Guardian or Conservator

☐ Other:  ______________________________

Signer Is Representing:  _____________________

______________________________________

©2014 National Notary Association • www.NationalNotary.org • 1-800-US NOTARY
(1-800-876-6827) Item #5907

 

 

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“EXHIBIT A”

LEGAL DESCRIPTION

ALL that certain plot piece or parcel of land, situate, lying and being in the
Borough of Manhattan, City of New York, County of New York, State of New York,
bounded and described as follows:

BEGINNING at the point of the easterly side of Third Avenue, distant northerly
100 feet 4 inches from the corner formed by the intersection of the northerly
side of 59 Street and the easterly side of Third Avenue;

RUNNING THENCE easterly parallel with the northerly side of 59th Street and part
of the way through a party wall, 105 feet;

THENCE northerly parallel with Third Avenue, 75 feet ¼  inch;

THENCE westerly parallel with 59th Street, 105 feet to the easterly side of
Third Avenue; and

THENCE southerly along the easterly side of Third Avenue, 75 feet ¼ inch to the
point or place of BEGINNING.

 

Exhibit “A”-1

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“EXHIBIT B”

PERMITTED ENCUMBRANCES

Any interests expressly referenced on Schedule B-I of that certain Title
Insurance Policy No. 7230732-219191985 issued by New York Metro Title Agency,
Inc. in connection with this Mortgage.

 

Exhibit “B”-1

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APPENDIX A

GLOSSARY OF DEFINED TERMS

“Affidavit of Title” means the affidavit of title given by Mortgagor to
Mortgagee in connection with this Mortgage.

“Affiliates” of a party means (a) any Person directly or indirectly controlling,
under common control with, or controlled by, that party, (b) any Person in which
that party directly or indirectly owns or controls any interest, (c) any
employee, officer, shareholder, director, subsidiary or joint venture of that
party and (d) any relative of the foregoing.

“Appendix” means an Appendix to this Mortgage.

“Awards and Proceeds” means all awards, damages, claims, payments, insurance
proceeds (other than from liability insurance coverage) and other compensation
with respect to the Land, Improvements, Fixtures and Equipment and other
interests described in Section 3 (collectively referred to as “Awards and
Proceeds”) including those arising from:  (a) any governmental taking or
exercise of eminent domain, (b) any damage, injury, casualty or other
destruction or loss or (c) any change of grade or vacation of any street.

“CFO” means Mortgagor’s chief financial officer.

“Commitment Letter” means the letter dated March 5, 2020 from Mortgagee to
Mortgagor setting forth certain terms of the Loan Documents.

“Consolidation Agreement” means the Mortgage Consolidation, Modification and
Extension Agreement of this same date in the consolidated principal sum of
TWENTY-FIVE MILLION AND 00/100 DOLLARS ($25,000,000.00) which merges all prior
Mortgages of Mortgagor to cause one new consolidated lien for purpose of saving
Mortgage recording tax.

“Environmental Laws” means the New York Environmental Conservation Laws, the
Comprehensive Environmental Response, Compensation, and Liability Act (42 U.S.C.
s. 9601 et seq.), the Resource Conservation and Recovery Act (42 U.S.C. s. 6901,
et seq.), the New York Environmental Conservation Laws and all other federal,
state and local laws, rules and regulations regarding environmental matters.

“Expenses” means any and all fees, out-of-pocket costs and expenses, including
reasonable legal fees and disbursements, copying costs, delivery and postage
charges and all filing and recording costs.

“Event of Default” has the meaning set forth in Section 8.

“Fixtures and Equipment” means all fixtures, machinery, equipment, appliances,
goods, chattels, furniture, furnishings and personal property of every nature
presently or in the future attached to, or used or intended to be used in
connection with, the Land or Improvements, or to be erected on the Land or
Improvements, or to be erected on the Land or Improvements, to the extent owned
by Mortgagor, including gas and electric fixtures, radiators, heaters, engines,
machinery, boilers,

Appendix A-1

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ovens, elevators, bathtubs, sinks, water closets, faucets, air conditioning
equipment, plumbing and heating fixtures, refrigerators, freezers, shades,
blinds, draperies, carpets and all replacement and substitutions for, proceeds
of, and warranties with respect to, such property.

“Governmental Authority” means any federal, state or local political
subdivision, governmental authority, agency, commission or board.

“Guarantor(s)” means any Person who at any time guarantees payment or
performance of any Obligations to the Mortgagee, and such Person’s successors or
heirs, and assigns.

“Guaranty(ies)” means all guaranties of any Obligations presently or in the
future executed by any Guarantor in favor of Mortgagee.

“Hazardous Substances” means any pollutants and dangerous substances including
radon, and any “hazardous wastes” or “hazardous substances” as defined in any
Environmental Law.

“Improvements” means all buildings, structures and other improvements of every
nature presently or in the future on, attached to or used in connection with the
Land, including all betterments, substitutions, replacements and proceeds, and
all appurtenances, easements, rights of way or use, air rights, development
rights, and other rights, privileges and appurtenances to the Mortgaged
Property, and paved roads and walkways adjacent, or relating to, the foregoing
or to the Land, and all claims or demands, either in law or in equity, in
possession or expectancy, of, in, and to the Mortgaged Property.

“Land” means the land and property commonly known as 1001-1007 Third Avenue, New
York, New York, designated Block 1414, Lot 48 on the official Tax Map of the
County of New York, and having a legal description as set forth on Exhibit A to
this Mortgage;

“Leases and Rents” means all rents, issues, profits, revenues, royalties and
benefits now or hereafter due to Mortgagor in connection with the Land or
Improvements including all rights and interests of Mortgagor as landlord under
any existing and future leases with respect to the Land, Improvements and
Fixtures and Equipment;

“Loan” means the loan in the principal sum of TWENTY-FIVE MILLION AND 00/100
DOLLARS ($25,000,000.00) evidenced by the Note and secured by this Mortgage.

“Loan Documents” means this Mortgage, the Note, the Mortgage Consolidation,
Modification and Extension Agreement, the Guaranty, the Commitment Letter and
all other agreements, documents, notes, affidavits and certificates executed in
connection with this Mortgage.

“Mortgage” and “Consolidated Mortgage” as referred in the Consolidation
Agreement means this mortgage given by Mortgagor to Mortgagee to secure the Note
and all modifications, renewals and extensions of, and all amendments or
supplements to, this mortgage; this Mortgage is the Mortgage referred to in the
Note and Consolidated Note as referred to in the Consolidation Agreement.

“Mortgagee” means the mortgagee named in the above caption of this Mortgage and
its successors and assigns.

Appendix A-2

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“Mortgagor” means the mortgagor named in the above caption of this Mortgage and
its successors and assigns.

“Mortgaged Property” shall have the meaning set forth in Section 3 of this
Mortgage.

“Note” and “Consolidated Note” as referred to in the Consolidation Agreement
means the consolidated, amended and restated mortgage promissory note of this
same date from Mortgagor to the order of Mortgagee in the original principal
amount of TWENTY-FIVE MILLION AND 00/100 DOLLARS ($25,000,000.00) as amended,
modified, renewed, extended or replaced from time to time.

“Obligations” means all debts, liabilities, duties and obligations owing from
any Obligor to Mortgagee, whether direct or indirect, now existing or in the
future created or acquired, contingent or non-contingent, due or to become due,
liquidated or unliquidated, including the Note, any Guaranty of the Note, all
other Loan Documents, all modifications thereof and all expenses of Mortgagee to
protect the Mortgaged Property or Mortgagee’s interest in the Mortgaged
Property.

“Obligor(s)” means each Mortgagor and each Guarantor, and every other Person who
may now or in the future have any duties, debts or liabilities to Mortgagee
pursuant to any Loan Document.

“Other Rights” means all other rights whatsoever that any Mortgagor or any other
future owner has or may acquire in the Land, Improvements, Fixtures and
Equipment, Awards and Proceeds and all other above-described property and
interests, including all rights, privileges, rights of way, easements, public
spaces, streets, alleys, appurtenances and sewer, air, mineral, water and
subsurface rights of all kinds and all agreements, licenses, contracts and
permits affecting the Mortgaged Property.

“Permitted Encumbrances” means (a) any lien for municipal real estate taxes,
assessments or utilities that are not yet due and payable, and (b) any easements
that do not, in Mortgagee’s reasonable judgment, interfere with the intended use
or operation, or impair the value, of the Mortgaged Property, and (c) any other
interests expressly referenced on Exhibit B to this Mortgage or on Schedule B-I
of that certain Title Insurance Policy No. 7230732-219191985 issued by New York
Metro Title Agency, Inc. in connection with this Mortgage.

“Person(s)” means an individual, corporation, limited liability company,
non-profit corporation, partnership, limited partnership, joint venture, trust,
joint stock company, unincorporated organization, association, Governmental
Authority or other business entity.

“Prime Rate” means the rate of interest that Mortgagee adopts from time to time
as its official prime rate.  The Prime Rate is not tied to any external rate of
interest or index and does not necessarily reflect the lowest rate of interest
actually charged at any given time by Mortgagee to any particular class or
category of customers of Mortgagee.  Any change in the Prime Rate shall be
effective immediately when adopted by the Mortgagee, without notice to any
Obligor.

“Section” means a section or subsection of this Mortgage.

“Transfer” means any change in ownership or control, whether or not that change
is voluntary, involuntary or by operation of law, direct or indirect, or by
merger (regardless of who is the

Appendix A-3

--------------------------------------------------------------------------------

 

survivor of that merger) or by any pledge, mortgage, assignment, sale, lease,
lien, encumbrance, option, transfer or disposal of any kind.

To “Use” a substance means to generate, store, refine, treat, discharge, handle,
refine, spill, release, emit, leach or dispose of that substance in any manner.

Appendix A-4

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