Document:

EXHIBIT 10.1
                                                                    ------------

                     NON-COMPETITION AND SEVERANCE AGREEMENT
                     ---------------------------------------

     This Agreement is made and entered into as of the 28th of October, 2005,
by and between CHATTEM, INC., a Tennessee corporation (the Company") and Robert
E. Bosworth (the "Executive").

                                   WITNESSETH
                                   ----------

     WHEREAS, the Company is desirous of assuring itself of continuity of
management through the hiring and retention of certain key executives, and to
foster their unbiased and analytical assessment of any offer to acquire control
of the Company; and

     WHEREAS, the Company desires to impose upon the Executive obligations of
confidentiality and to restrict his ability to obtain employment with certain
competitors of the Company; and

     WHEREAS, the Executive is willing to accept obligations of confidentiality
and non-competition in exchange for specified severance benefits;

     NOW, THEREFORE, the Company and the Executive do hereby agree as follows:

     1. Term. The term of this Agreement shall commence as of the day and year
first above written and continue indefinitely thereafter for a period ending
three (3) years after the termination of the Executive's employment with the
Company.

     2. Confidentiality Obligations. During the term of this Agreement, the
Executive agrees to maintain all confidential information and trade secrets
obtained during the course of his employment with the Company as confidential
and to disclose the same to no one, other than in the furtherance of the
Company's business in the normal course or to a fellow employee with a
reasonable need to know, unless the Executive can demonstrate by documentary
evidence that such information was (1) known to him prior to his employment with
the Company; (2) subsequently became part of the public domain through no fault
of his own; or (3) was subsequently disclosed to him by a third party not in
violation of any obligation of confidentiality and non-use with the Company.

     3. Non-Compete. In the event of a Change in Control (as hereinafter
defined) while Executive is employed by the Company and during the term of this
Agreement, Executive will not accept compensation or anything of value from, nor
offer or provide any services, including consulting services, to any person,
company, partnership, joint venture or other entity which has or does a
significant business involving, in whole or in part, health and beauty aid
products sold over the counter. This provision applies only to entities selling
the above specified products in competition with the Company in the United
States.

     4. Severance Benefits. If the Company Discharges or Constructively
Discharges the Executive during the term of this Agreement within twenty-four
(24) months after the occurrence of a Change in Control, he shall receive a
Severance Benefit. In addition, after a Change in Control, the Executive shall
be entitled to resign his position with the Company and elect to receive the
Severance Benefit (the "Election") at any time during the period commencing
one-hundred and eighty (180) days after the Change in Control and ending
two-hundred and forty (240) days after the Change in Control notwithstanding
that the fact that no Discharge or Constructive Discharge has occurred. These
terms are hereby defined as follows:

<PAGE>

          A.   "Change in Control":

                    (i) Change of one-third (1/3) or more of any directors of
               the Company within any twelve (12) month period; or

                    (ii)Change of one-half (1/2) or more of the directors of the
               Company within any twenty-four (24) month period; or

                    (iii)Acquisition by any person of the ownership or right to
               vote of thirty-five (35%) percent or more of the Company's
               outstanding voting shares. "Person" shall mean any person,
               corporation, partnership, or any entity and any affiliate or
               associate thereof. "Affiliate" and "associate" shall have the
               meanings assigned to them in Rule 12(b)(2) of the General Rules
               and Regulations under the Securities Exchange Act of 1934.

          B.   "Discharges": terminates the Executive for any reason other than
               indictment or conviction for a felony or other crime involving
               substantial moral turpitude, disability, death, alcoholism, drug
               addiction or the gross, active misfeasance of the Executive with
               regard to his duties with the Company.

          C.   "Constructively Discharges": changes location or reduces the
               Executive's status, duties, responsibilities or direct or
               indirect compensation, (including future increases commensurate
               with those given other managers of the Company), or so alters the
               style or philosophy of the conduct of the Company's business, in
               the opinion of the Executive, as to cause it to be undesirable to
               the Executive to remain in the employ of the Company.

          D.   "Severance Benefit": a payment equal to two hundred (200%)
               percent of the Executive's average annual includible compensation
               from the Company during the five (5) most recently completed
               taxable years before the date on which the Change in Control
               occurs. Any partial taxable years shall be annualized. If the
               event that the Executive's employment is less than five (5)
               years, the average annual compensation should be calculated based
               on the rate of compensation for the actual term of employment.

     Notwithstanding the foregoing Severance Benefit formula, any payments to
which the Executive is entitled upon Discharge or Constructive Discharge from
the Company shall be adjusted so that the aggregate present value of all
"parachute payments" (as defined in Section 280G of the Internal Revenue Code of
1986, as amended from time to time (the "Code") to which the Executive is
entitled is less than 300% of the Executive's "annualized includible
compensation for the base period" as defined in the Code. The determination as
to whether there is any adjustment (and the extent thereof) in the payments due
the Executive because of this paragraph shall be made in writing within thirty
(30) days after Discharge or Constructive Discharge or Election, by the
Company's independent certified public accountants on the date of the Change in
Control and shall be final and binding on the Executive and the Company. The

                                        2
<PAGE>

Company shall furnish said independent certified public accountants with all
data required to make said determination within ten (10) days after Discharge or
Constructive Discharge or Election. If there is any such adjustment, the
Executive may elect in the Executive's sole discretion which payments or
distributions shall be reduced and/or which payments or distributions shall be
deferred and promptly notify the Company in writing of such election.

     5. Payment. The Severance Benefit shall be paid to the Executive in a lump
sum or, at the Executive's election, in two (2) equal installments with the
first to be made not later than thirty (30) days after Discharge or Constructive
Discharge or Election and the second installment one (1) year after the first
installment was paid. No interest shall be due upon the Severance Benefit unless
it is not paid when due and in which case interest shall accrue thereon at the
applicable Federal rate used to determined present value under Section 280G of
the Internal Revenue Code of 1986, as amended.

     6. Continuation of Benefits. The Company shall continue to provide to the
Executive at its cost and expense health, medical and life insurance benefits at
substantially the same level of benefits as the Executive has at the date he
becomes entitled to the Severance Benefit in accordance with Section 4 hereof
for a period of two (2) years following the date the Executive becomes entitled
to such Severance Benefit.

     7. Arbitration of All Disputes. Any controversy or claim arising out of or
relating to this Agreement or the breach thereof, shall be settled by
arbitration in the City of Chattanooga in accordance with the laws of the State
of Tennessee by three (3) arbitrators, one of whom shall be appointed by the
Company, one by the Executive and the third of whom shall be appointed by the
first two arbitrators. If the first two arbitrators cannot agree on the
appointment of a third arbitrator, then the third arbitrator shall be appointed
by the American Arbitration Association. The arbitration shall be conducted in
accordance with the rules of the American Arbitration Association. Judgment upon
the award rendered by the arbitrators may be entered in any court having
jurisdiction thereof. In the event that it shall be necessary or desirable for
the Executive to retain legal counsel and/or incur other costs and expenses in
connection with the enforcement of any and all of his rights under this
Agreement, the Company shall pay (or the Executive shall be entitled to recover
from the Company, as the case may be) his reasonable attorneys' fees and costs
and expenses in connection with the enforcement of his said rights (including
the enforcement of any arbitration award in court), regardless of the final
outcome, unless the arbitrators shall determine that under the circumstances
recovery by the Executive of all or a part of any such fees and costs and
expenses would be unjust.

     8. Notices. Any notices, requests, demands and other communications
provided for by this Agreement shall be sufficient if in writing and if sent by
registered or certified mail to the Executive at the last address he has filed
in writing with the Company or, in the case of the Company, at its principal
executive offices addressed to the President.

     9. Non-Alienation. The Executive shall not have any right to pledge,
hypothecate, anticipate or in any way create a lien upon any amounts provided
under this Agreement; and no benefits payable hereunder shall be assignable in
anticipation of payment either by voluntary or involuntary acts, or by operation
of law. Notwithstanding the foregoing provisions, in the event that the
Executive dies following Discharge or Constructive Discharge after a Change in
Control but before receiving all of his Severance Benefit, the unpaid Severance
Benefit shall be paid to his Estate in accordance with the terms of this
Agreement.

                                        3
<PAGE>

     10. Governing Law. The provisions of this Agreement shall be construed in
accordance with the laws of the State of Tennessee.

     11. Amendment. This Agreement may not be amended or cancelled except by the
mutual agreement of the parties in writing.

     12. Successors to the Company. Except as otherwise provided herein, this
Agreement shall be binding upon and inure to the benefit of the Company and any
successor of the Company.

     13. Severability. In the event that any provision or portion of this
Agreement shall be determined to be invalid or unenforceable for any reason, the
remaining provisions of this Agreement shall be unaffected thereby and shall
remain in full force and effect.

     IN WITNESS WHEREOF, the Executive has hereunto set his hand and, pursuant
to the authorization from its Board of Directors, the Company has caused these
presents to be executed in its name on its behalf, all as of the day and year
first above written.

                                       /s/ Robert E. Bosworth
                                       -----------------------------------------
                                       Robert E. Bosworth

                                       CHATTEM, INC.

                                       By: /s/ Zan Guerry
                                           -------------------------------------
          `                                Zan Guerry
                                           Chairman and Chief Executive Officer

                                        4Exhibit
10.29

 

MORTGAGE DEED, SECURITY AGREEMENT, FIXTURE FILING,

FINANCING STATEMENT

AND ASSIGNMENT OF LEASES AND RENTS

 

THIS MORTGAGE DEED, SECURITY AGREEMENT, FIXTURE
FILING, FINANCING STATEMENT AND ASSIGNMENT OF LEASES AND RENTS (this “Mortgage”)
is executed as of July 6, 2005, by TRADEPORT DEVELOPMENT II, LLC, a
Connecticut limited liability company (“Mortgagor”), in favor of, and for the
use and benefit of, FIRST SUNAMERICA LIFE INSURANCE COMPANY, a New York
corporation (“Mortgagee”).

 

ARTICLE 1

PARTIES, PROPERTY, AND DEFINITIONS

 

The following terms and references shall have the
meanings indicated:

 

1.1          Agreement Concerning
Master Lease:  The Agreement
Concerning Master Lease of even date herewith by and between Mortgagor,
Mortgagee, and Guarantor.

 

1.2          Application:  As defined in Section 9.20.

 

1.3          Chattels:  All goods, fixtures, inventory, equipment,
building and other materials, supplies, and other tangible personal property of
every nature, to the extent now owned or hereafter acquired by Mortgagor and
used or intended for use in the construction, development, or operation of the
Property, together with all accessions thereto, replacements and substitutions
therefor, and proceeds thereof.

 

1.4          Controlling Persons:  Collectively, (a) Guarantor, (b) any
other party directly or indirectly liable for payment of the Secured
Obligations, whether as maker, endorser, guarantor, surety, general partner, or
otherwise, and (c) any successor to any of the foregoing.  Pursuant to the foregoing, River Bend Associates,
Inc., a Connecticut corporation, is not a Controlling Person as of the date of
this Mortgage.  No shareholder, officer,
or director of Guarantor shall be considered a Controlling Person.

 

1.5          Default:  Any matter which, with the giving of notice,
passage of time, or both, would constitute an Event of Default.

 

1.6          Environmental Indemnity
Agreement:  The Environmental
Indemnity Agreement of even date herewith made by Mortgagor and Guarantor for
the benefit of Mortgagee.

 

1.7          ERISA:  The Employee Retirement Income Security Act
of 1974, as amended, together with all rules and regulations issued thereunder.

 

 

1.8          Event of Default:  As defined in Article 6.

 

1.9          Guarantor:  Griffin Land & Nurseries, Inc., a
Delaware corporation.

 

1.10        Guaranty Agreement:  The Guaranty Agreement of even date herewith
made by Guarantor for the benefit of Mortgagee.

 

1.11        Insurance Agreement:  The Agreement Concerning Insurance
Requirements of even date herewith executed by Mortgagor for the benefit of
Mortgagee.

 

1.12        Intangible Personalty:  To the extent now owned or hereafter acquired
by Mortgagor, the right to use all trademarks and trade names and symbols or
logos used in connection therewith, or any modifications or variations thereof,
in connection with the operation of the improvements existing or to be
constructed on the Property, together with all accounts, deposit accounts,
letter of credit rights, investment property, monies in the possession of
Mortgagee (including without limitation proceeds from insurance, retainages and
deposits for taxes and insurance), Permits, contract rights (including, without
limitation, rights to receive insurance proceeds) and general intangibles
(whether now owned or hereafter acquired, and including proceeds thereof)
relating to or arising from Mortgagor’s ownership, use, operation, leasing, or
sale of all or any part of the Property, specifically including but in no way
limited to any right which Mortgagor may have or acquire to transfer any
development rights from the Property to other real property, and any
development rights which may be so transferred.

 

1.13        Lease Certificate:  The certificate of even date herewith made by
Mortgagor to Mortgagee concerning Leases.

 

1.14        Leases:  Any and all leases, subleases and other
agreements under the terms of which any person other than Mortgagor has or
acquires any right to occupy or use the Property, or any part thereof.

 

1.15        Loan:  The loan from Mortgagee to Mortgagor
evidenced by the Note.

 

1.16        Loan Documents:  The Note, all of the deeds of trust,
mortgages and other instruments and documents securing or executed and
delivered in connection with the Note, including this Mortgage; the Insurance
Agreement; the Environmental Indemnity Agreement; the Guaranty Agreement; the
Lease Certificate; Agreement Concerning Master Lease (as defined in Section 1.1 above); Tenant Improvements and Leasing
Commissions Escrow Agreement (as defined in Section 1.25
below) and each other document executed or delivered in connection with the
transaction pursuant to which the Note has been executed and delivered.  The term “Loan Documents” also includes all
modifications, extensions, renewals, and replacements of each document referred
to above.

 

1.17        Mortgagee:  The Mortgagee named in the introductory
paragraph of this Mortgage, whose legal address is c/o AIG Global
Investment Corp., 1 SunAmerica Center, 38th Floor,
Century City, Los Angeles, California 90067-6022, together with
any future holder of the Note.

 

 

1.18        Mortgagor:  The Mortgagor named in the introductory
paragraph of this Mortgage (Taxpayer Identification No. 20-2650579;
Organizational I.D. No. 0814512), whose legal address is 204 West
Newberry Road, Bloomfield, Connecticut 06002-1308, together with any
future owner of the Property or any part thereof or interest therein.

 

1.19        Note:  Mortgagor’s promissory note of even date
herewith, payable to the order of Mortgagee in the principal face amount of
$12,700,000.00, the last payment under which is due on August 1, 2015, or,
if extended by Mortgagee pursuant to its terms, August 1, 2020, unless
such due date is accelerated, together with all renewals, extensions and
modifications of such promissory note. 
All terms and provisions of the Note are incorporated by this reference
in this Mortgage.

 

1.20        Permits:  All permits, licenses, certificates and
authorizations necessary for the beneficial development, ownership, use,
occupancy, operation and maintenance of the Property.

 

1.21        Permitted Exceptions:  The matters (excluding matters of survey) set
forth in Schedule B-I of the title insurance policy insuring the lien
created by this Mortgage, in form and substance satisfactory to, and accepted
by, Mortgagee, that Mortgagor has caused to be delivered to Mortgagee in
connection with the Loan.

 

1.22        Property:  The tract or tracts of land described in Exhibit A
attached, together with the following:

 

(a)           All buildings,
structures, and improvements now or hereafter located on such tract or tracts,
as well as all rights-of-way, easements, and other appurtenances thereto;

 

(b)           All of Mortgagor’s
right, title, and interest in and to any land lying between the boundaries of
such tract or tracts and the center line of any adjacent street, road, avenue,
or alley, whether opened or proposed;

 

(c)           All of the rents,
income, receipts, revenues, issues and profits of and from such tract or tracts
and improvements;

 

(d)           To the extent now owned
or hereafter acquired by Mortgagor, all (i) water and water rights
(whether decreed or undecreed, tributary, nontributary or not nontributary,
surface or underground, or appropriated or unappropriated); (ii) ditches
and ditch rights; (iii) spring and spring rights; (iv) reservoir and
reservoir rights; and (v) shares of stock in water, ditch and canal
companies and all other evidence of such rights, and which are appurtenant to
or which have been used in connection with such tract or tracts or
improvements;

 

(e)           Any minerals, crops,
timber, trees, shrubs, flowers, and landscaping features now or hereafter
located on, under or above such tract or tracts;

 

(f)            Subject to the rights
of any utility or public service provider, all machinery, apparatus, equipment,
fittings, fixtures (whether actually or constructively attached, and including
all trade, domestic, and ornamental fixtures) now or hereafter located in,
upon, or

 

 

under
such tract or tracts or improvements and used or usable in connection with any
present or future operation thereof, including but not limited to all heating,
air-conditioning, freezing, lighting, laundry, incinerating and power
equipment; engines; pipes; pumps; tanks; motors; conduits; switchboards;
plumbing, lifting, cleaning, fire prevention, fire extinguishing,
refrigerating, ventilating, cooking, and communications apparatus; boilers,
water heaters, ranges, furnaces, and burners; appliances; vacuum cleaning
systems; elevators; escalators; shades; awnings; screens; storm doors and
windows; stoves; refrigerators; attached cabinets; partitions; ducts and
compressors; rugs and carpets; draperies; and all additions thereto and replacements
therefor, except any such items owned by tenants under Leases or leased by such
tenants from any entity other than Mortgagor;

 

(g)           Any development rights
associated with such tract or tracts, whether previously or subsequently
transferred to such tract or tracts from other real property or now or
hereafter susceptible of transfer from such tract or tracts to other real
property;

 

(h)           Subject to the rights
of tenants under Leases, any awards and payments, including interest thereon,
resulting from the exercise of any right of eminent domain or any other public
or private taking of, injury to, or decrease in the value of, any of such
property; and

 

(i)            Any other and greater
rights and interests of every nature in such tract or tracts and in the possession
or use thereof and income therefrom, to the extent now owned or subsequently
acquired by Mortgagor.

 

1.23        Secured Obligations:  The principal sum of $12,700,000.00 and all
other present and future obligations of Mortgagor to Mortgagee evidenced by or
contained in the Note, the Environmental Indemnity Agreement, this Mortgage and
all other Loan Documents, whether stated in the form of promises, covenants,
representations, warranties, conditions, or prohibitions or in any other form.  If the maturity of the Note secured by this
Mortgage is accelerated, the Secured Obligations shall include an amount equal
to any prepayment premium which would be payable under the terms of the Note as
if the Note were prepaid in full on the date of the acceleration.  If under the terms of the Note no voluntary
prepayment would be permissible on the date of such acceleration, then the
prepayment fee or premium to be included in the Secured Obligations shall be
equal to one hundred fifty percent (150%) of the highest prepayment fee or
premium set forth in the Note, calculated as of the date of such acceleration,
as if prepayment were permitted on such date.

 

1.24        State:  The State in which the Property is located.

 

1.25        Tenant Improvements and
Leasing Commissions Escrow Agreement: 
The Tenant Improvements and Leasing Commissions Escrow Agreement of even
date herewith by and between Mortgagor, Mortgagee, and the “Escrow Agent” named
therein.

 

 

Article 2

GRANTING CLAUSE

 

2.1          Grant to Mortgagee.  As security for the Secured Obligations,
Mortgagor hereby gives, grants, bargains, sells, conveys, mortgages, assigns,
confirms and warrants unto Mortgagee the entire right, title, interest and
estate of Mortgagor in and to the Property, whether now owned or hereafter
acquired; TO HAVE AND TO HOLD the same, together with all and singular the
rights, hereditaments, and appurtenances in anywise appertaining or belonging
thereto, unto Mortgagee and Mortgagee’s successors, substitutes and assigns
forever, to its and their own proper use and behoof.

 

2.2          Security Interest to
Mortgagee.  As additional security
for the Secured Obligations, Mortgagor hereby grants to Mortgagee a security
interest in the Property, Chattels and Intangible Personalty.  To the extent any of the Property, Chattels or
the Intangible Personalty may be or have been acquired with funds advanced by
Mortgagee under the Loan Documents, this security interest is a purchase money
security interest.  This Mortgage
constitutes a Security Agreement under the Uniform Commercial Code of the state
in which the Property is located (the “Code”) with respect to any part of the
Property, Chattels and Intangible Personalty that may or might now or hereafter
be or be deemed to be personal property, fixtures or property other than real
estate (all collectively hereinafter called “Collateral”); all of the terms,
provisions, conditions and agreements contained in this Mortgage pertain and
apply to the Collateral as fully and to the same extent as to any other
property comprising the Property, and the following provisions of this Section shall
not limit the generality or applicability of any other provisions of this
Mortgage but shall be in addition thereto:

 

(a)           The Collateral shall be
used by Mortgagor solely for business purposes, and all Collateral (other than
the Intangible Personalty) shall be installed upon the real estate comprising
part of the Property for Mortgagor’s own use or as the equipment and
furnishings furnished by Mortgagor, as landlord, to tenants of the Property;

 

(b)           Subject to Section 5.7 below, the Collateral (other than the
Intangible Personalty) shall be kept at the real estate comprising a part of
the Property, and shall not be removed therefrom without the consent of
Mortgagee (being the Secured Party as that term is used in the Code); and the
Collateral (other than the Intangible Personalty) may be affixed to such real
estate but shall not be affixed to any other real estate;

 

(c)           No financing statement
covering any of the Collateral or any proceeds thereof is on file in any public
office; and Mortgagor will, at its cost and expense, upon demand, furnish to
Mortgagee such further information and will execute and deliver to Mortgagee
such financing statements and other documents in form satisfactory to Mortgagee
and will do all such acts and things as Mortgagee may at any time or from time
to time reasonably request or as may be necessary or appropriate to establish
and maintain a perfected first-priority security interest in the Collateral as
security for the Secured Obligations, subject to no adverse liens or
encumbrances; and Mortgagor will pay the cost of filing the same or filing or
recording such financing statements or other documents and this instrument in
all public offices wherever filing or recording is deemed by Mortgagee to be
necessary or desirable;

 

(d)           The terms and
provisions contained in this Section and in Section 7.6
of this Mortgage shall, unless the context otherwise requires, have the
meanings and be construed as provided in the Code; and

 

 

(e)           This Mortgage
constitutes a financing statement under the Code with respect to the
Collateral.  As such, this Mortgage
covers all items of the Collateral that are or are to become fixtures.  The filing of this Mortgage in the real
estate records of Windsor, Connecticut, where the Property is located shall
constitute a fixture filing in accordance with the Code.  Information concerning the security interests
created hereby may be obtained at the addresses set forth in Article 1 of this Mortgage. 
Mortgagor is the “Debtor” and Mortgagee is the “Secured Party” (as those
terms are defined and used in the Code) insofar as this Mortgage constitutes a
financing statement.

 

THE CONDITION OF THIS DEED IS SUCH THAT Mortgagor is
indebted to Mortgagee in the principal sum of TWELVE MILLION SEVEN HUNDRED
THOUSAND DOLLARS and NO/100THS DOLLARS, as evidenced by the Note and is
indebted for the other Secured Obligations, and Mortgagor further covenants and
agrees as follows:

 

ARTICLE 3

MORTGAGOR’S REPRESENTATIONS AND WARRANTIES

 

3.1          Warranty of Title.  Mortgagor represents and warrants to
Mortgagee that:

 

(a)           Mortgagor has good and
marketable fee simple title to the Property, and such fee simple title is free
and clear of all liens, encumbrances, security interests and other claims
whatsoever, subject only to the Permitted Exceptions;

 

(b)           Mortgagor is the sole
and absolute owner of the Chattels and the Intangible Personalty, free and
clear of all liens, encumbrances, security interests and other claims
whatsoever, subject only to the Permitted Exceptions;

 

(c)           This Mortgage is a
valid and enforceable first lien and security interest on the Property,
Chattels and Intangible Personalty, subject only to the Permitted Exceptions;

 

(d)           Mortgagor, for itself
and its successors and assigns, hereby agrees to warrant and forever defend,
all and singular of the property and property interests granted and conveyed
pursuant to this Mortgage, against every person whomsoever lawfully claiming,
or to claim, the same or any part thereof; and

 

The representations, warranties and covenants
contained in this Section shall survive foreclosure of this Mortgage, and
shall inure to the benefit of and be enforceable by any person who may acquire
title to the Property, the Chattels, or the Intangible Personalty pursuant to
any such foreclosure.

 

3.2          Due Authorization.  If Mortgagor is other than a natural person,
then each individual who executes this document on behalf of Mortgagor
represents and warrants to Mortgagee that such execution has been duly authorized
by all necessary corporate, partnership, limited liability company or other
action on the part of Mortgagor. 
Mortgagor represents that Mortgagor has obtained all consents and
approvals required in connection with the execution, delivery and performance
of this Mortgage;

 

 

3.3          Other Representations
and Warranties.  Mortgagor represents
and warrants to Mortgagee as follows:

 

(a)           Mortgagor is a limited
liability company, duly organized, validly existing and in good standing under
the laws of the State of Connecticut. 
The sole Controlling Person of Mortgagor is Guarantor.  Guarantor is a corporation, duly organized,
validly existing and in good standing under the laws of the State of Delaware;

 

(b)           The execution, delivery
and performance by Mortgagor of the Loan Documents are within Mortgagor’s power
and authority and have been duly authorized by all necessary action;

 

(c)           This Mortgage is, and
each other Loan Document to which Mortgagor or Guarantor is a party will, when
delivered hereunder, be valid and binding obligations of Mortgagor and
Guarantor enforceable against Mortgagor and Guarantor in accordance with their
respective terms, except as limited by equitable principles and bankruptcy,
insolvency and similar laws affecting creditors’ rights;

 

(d)           The execution, delivery
and performance by Mortgagor and Guarantor of the Loan Documents will not
contravene any contractual or other restriction binding on or affecting
Mortgagor or any Controlling Person and will not result in or require the
creation of any lien, security interest, other charge or encumbrance (other
than pursuant hereto) upon or with respect to any of its properties;

 

(e)           The execution, delivery
and performance by Mortgagor and Guarantor of the Loan Documents does not
contravene any applicable law;

 

(f)            No authorization,
approval, consent or other action by, and no notice to or filing with, any
court, governmental authority or regulatory body is required for the due
execution, delivery and performance by Mortgagor and Guarantor of any of the
Loan Documents or the effectiveness of any assignment of any of Mortgagor’s
rights and interests of any kind to Mortgagee;

 

(g)           No part of the
Property, Chattels, or Intangible Personalty is in the hands of a receiver, no
application for a receiver is pending with respect to any portion of the
Property, Chattels, or Intangible Personalty, and no part of the Property,
Chattels, or Intangible Personalty is subject to any foreclosure or similar
proceeding;

 

(h)           Neither Mortgagor nor
any Controlling Person has made any assignment for the benefit of creditors,
nor has Mortgagor or any Controlling Person filed, or had filed against it, any
petition in bankruptcy;

 

(i)            There is no pending
or, to the best of Mortgagor’s knowledge, threatened, litigation, action,
proceeding or investigation, including, without limitation, any condemnation
proceeding, against Mortgagor or the Property before any court, governmental or
quasi-governmental, arbitrator or other authority, and no such action against
any Controlling Person which could have a material adverse effect on its
financial condition;

 

 

(j)            Mortgagor is a “non-foreign
person” within the meaning of Sections 1445 and 7701 of the United States
Internal Revenue Code of 1986, as amended, and the regulations issued thereunder;

 

(k)           Access to and egress
from the Property are available and provided by public streets, and Mortgagor
has no knowledge of any federal, state, county, municipal or other governmental
plans to change the highway or road system in the vicinity of the Property or
to restrict or change access from any such highway or road to the Property
which would adversely affect the Property, access to the Property or the
operation of the Property as it is currently being used;

 

(l)            All public utility
services necessary for the operation of all improvements constituting part of
the Property for their intended purposes are available at the boundaries of the
land constituting part of the Property, including water supply, storm and
sanitary sewer facilities, and natural gas, electric and telephone facilities;

 

(m)          The Property is located
in a zoning district designated I-1 (Industrial Zone), by the Town of Windsor,
Connecticut.  Such designation permits
the development, use and operation of the Property as it is currently operated
as a permitted, and not as a non-conforming use.  Mortgagor’s use of the Property and the uses
of the Property permitted to tenants under Leases comply in all respects with
all zoning ordinances, regulations, requirements, conditions and restrictions,
including but not limited to deed restrictions and restrictive covenants,
applicable to the Property;

 

(n)           There are no special or
other assessments for public improvements or otherwise now affecting the
Property, nor does Mortgagor know of any pending or threatened special
assessments affecting the Property or any contemplated improvements affecting
the Property that may result in special assessments.  There are no tax abatements or exceptions
affecting the Property;

 

(o)           Mortgagor and each Controlling
Person has filed all tax returns it is required to have filed, and has paid all
taxes as shown on such returns or on any assessment received pertaining to the
Property;

 

(p)           Mortgagor has not
received any notice from any governmental body having jurisdiction over the
Property as to any violation of any applicable law, or any notice from any
insurance company or inspection or rating bureau setting forth any requirements
as a condition to the continuation of any insurance coverage on or with respect
to the Property or the continuation thereof at premium rates existing at
present which have not been remedied or satisfied;

 

(q)           Neither Mortgagor nor
any Controlling Person is in default, in any manner which would adversely
affect its properties, assets, operations or condition (financial or
otherwise), in the performance, observance or fulfillment of any of the
obligations, covenants or conditions set forth in any agreement or instrument
to which it is a party or by which it or any of its properties, assets or
revenues are bound;

 

 

(r)            Except as set forth in
the Lease Certificate, there are no occupancy rights (written or oral), Leases
or tenancies (other than subleases) presently affecting any part of the
Property.  To Mortgagor’s knowledge,
there are no subleases presently affecting any part of the Property.  The Lease Certificate contains a true and
correct description of all Leases presently affecting the Property (other than
subleases).  No written or oral
agreements or understandings exist between Mortgagor and the tenants under the
Leases described in the Lease Certificate that grant such tenants any rights
greater than those described in the Lease Certificate or that are in any way
inconsistent with the rights described in the Lease Certificate;

 

(s)           There are no purchase
options, purchase contracts or other similar agreements of any type (written or
oral) presently affecting any part of the Property;

 

(t)            There exists no
brokerage agreement with respect to any part of the Property, except as otherwise
disclosed to Mortgagee in writing;

 

(u)           Except as otherwise
disclosed to Mortgagee in writing prior to the date hereof, (i) there are
no contracts presently affecting the Property (“Contracts”) having a term in
excess of one hundred eighty (180) days or not terminable by Mortgagor (without
penalty) on thirty (30) days’ notice; (ii) Mortgagor has heretofore
delivered to Mortgagee true and correct copies of each of the Contracts
together with all amendments thereto; (iii) Mortgagor is not in default of
any obligations under any of the Contracts; and (iv) the Contracts
represent the complete agreement between Mortgagor and such other parties as to
the services to be performed or materials to be provided thereunder and the
compensation to be paid for such services or materials, as applicable, and
except as otherwise disclosed herein, such other parties possess no unsatisfied
claims against Mortgagor.  Mortgagor is
not in default under any of the Contracts and no event has occurred which, with
the passing of time or the giving of notice, or both, would constitute a
default under any of the Contracts;

 

(v)           Mortgagor has obtained
all Permits required to be obtained by Mortgagor for the operation, use,
ownership, development, occupancy and maintenance of the Property as an
industrial distribution center, as it is currently being operated.  None of the Permits has been suspended or
revoked, and all of the Permits are in full force and effect, are fully paid
for, and Mortgagor has made or will make application for renewals of any of the
Permits prior to the expiration thereof;

 

(w)          All insurance policies
held by Mortgagor relating to or affecting the Property are in full force and
effect, and Mortgagor shall keep the property fully insured as required
hereunder until all Secured Obligations are satisfied.  Mortgagor has not received any notice of
default or notice terminating or threatening to terminate any such insurance
policies.  Mortgagor has made or will
make application for renewals of any of such insurance policies prior to the
expiration thereof;

 

(x)            Mortgagor currently
complies with ERISA.  Neither the making
of the Loan and secured by this Mortgage nor the exercise by Mortgagee of any
of its rights under the Loan Documents constitutes or will constitute a non-exempt,
prohibited transaction under ERISA; and

 

 

(y)           Mortgagor’s exact legal
name is correctly set out in the introductory paragraph of this Mortgage.  Mortgagor’s organizational identification
number is correctly set forth in the definition of “Mortgagor” set forth in Article 1 hereof. 
Mortgagor’s location (as such term is used in Section 5.8
hereof) is the State of Connecticut.

 

(z)            To the best of
Mortgagor’s knowledge, (i) no part of the Property has, at any time during
the period of three (3) years immediately preceding the date hereof, been
included in the “property description” of any real estate contiguous with the
Property (within the meaning of §22a–452a(c) of the Connecticut General
Statutes), (ii) no part of the Property is or has been an “establishment”
or a “service station” under §22a–134 – et seq. –
of the Connecticut General Statutes, and (iii) except as disclosed on the
Environmental Assessment (as defined in the Environmental Indemnity Agreement),
no part of the Property contains or has ever contained any underground storage
tanks or facilities (as such terms are defined in §22a–449(d) – and §22a-449(d)–101
of the Regulations of the State of Connecticut.

 

3.4          Continuing Effect.  Mortgagor shall be liable to Mortgagee for
any damage suffered by Mortgagee if any of the foregoing representations are
inaccurate as of the date hereof, regardless of when such inaccuracy may be
discovered by, or result in harm to, Mortgagee. 
Mortgagor further represents and warrants that the foregoing representations
and warranties, as well as all other representations and warranties of
Mortgagor to Mortgagee relative to the Loan Documents, shall survive
termination of this Mortgage.

 

ARTICLE 4

MORTGAGOR’S AFFIRMATIVE COVENANTS

 

4.1          Payment of Note.  Mortgagor will pay all principal, interest,
and other sums payable under the Note, on the date when such payments are due,
without notice or demand.

 

4.2          Performance of Other
Obligations.  Mortgagor will promptly
and strictly perform and comply with all other covenants, conditions, and
prohibitions required of Mortgagor by the terms of the Loan Documents.

 

4.3          Other Encumbrances.  Mortgagor will promptly and strictly perform
and comply with all covenants, conditions, and prohibitions required of
Mortgagor in connection with any other encumbrance affecting the Property, the
Chattels, or the Intangible Personalty, or any part thereof, or any interest
therein, regardless of whether such other encumbrance is superior or
subordinate to the lien hereof.

 

4.4          Payment of Taxes.

 

(a)           Property Taxes.  Unless Mortgagor is depositing money into
escrow pursuant to Section 4.4(b),
Mortgagor will (i) pay, before delinquency, all taxes and assessments,
general or special, which may be levied or imposed at any time against
Mortgagor’s interest and estate in the Property, the Chattels, or the
Intangible Personalty, and (ii) within ten (10) days after each payment of
any such tax or assessment, Mortgagor will deliver to Mortgagee, without notice
or demand, an official receipt for such payment.  At Mortgagee’s option, Mortgagee may retain
the services of a firm to monitor the payment of all taxes and

 

 

assessments
relating to the Property.  The cost of
such services shall be borne by Mortgagor unless Mortgagor is making deposits
pursuant to Section 4.4(b).

 

(b)           Deposit for Taxes.  On or before the date hereof, Mortgagor shall
deposit with Mortgagee an amount equal to 1/12th of the amount which Mortgagee
estimates will be required to make the next annual payment of taxes,
assessments, and similar governmental charges referred to in this Section,
multiplied by the number of whole or partial months that have elapsed since the
date one month prior to the most recent due date for such taxes, assessments
and similar governmental charges. 
Thereafter, with each monthly payment under the Note, Mortgagor shall
deposit with Mortgagee an amount equal to 1/12th of the amount which Mortgagee
estimates will be required to pay the next annual payment of taxes,
assessments, and similar governmental charges referred to in this Section.  The purpose of these provisions is to provide
Mortgagee with sufficient funds on hand to pay all such taxes, assessments, and
other governmental charges thirty (30) days before the date on which they
become past due.  If the Mortgagee, in
its sole discretion, determines that the funds escrowed hereunder are, or will
be, insufficient, Mortgagor shall upon demand pay such additional sums as
Mortgagee shall determine necessary and shall pay any increased monthly charges
requested by Mortgagee.  Provided no
Default or Event of Default exists hereunder, Mortgagee will apply the amounts
so deposited to the payment of such taxes, assessments, and other charges when
due, but in no event will Mortgagee be liable for any interest on any amount so
deposited, and any amount so deposited may be held and commingled with
Mortgagee’s own funds.

 

(c)           Intangible Taxes.  If by reason of any statutory or
constitutional amendment or judicial decision adopted or rendered after the
date hereof, any tax, assessment, or similar charge is imposed against the
Note, Mortgagee, or any interest of Mortgagee in any real or personal property
encumbered hereby, Mortgagor will pay such tax, assessment, or other charge
before delinquency and will indemnify Mortgagee against all loss, expense, or
diminution of income in connection therewith. 
In the event Mortgagor is unable to do so, either for economic reasons
or because the legal provisions or decisions creating such tax, assessment or
charge forbid Mortgagor from doing so, then the Note will, at Mortgagee’s
option, become due and payable in full upon thirty (30) days’ notice to
Mortgagor.

 

(d)           Right to Contest.  Notwithstanding any other provision of this
Section, Mortgagor will not be deemed to be in default solely by reason of
Mortgagor’s failure to pay any tax, assessment or similar governmental charge
so long as, in Mortgagee’s reasonable judgment, each of the following
conditions is satisfied:

 

(i)      Mortgagor is engaged in and
diligently pursuing in good faith administrative or judicial proceedings
appropriate to contest the validity or amount of such tax, assessment, or
charge; and

 

(ii)     Mortgagor’s payment of such
tax, assessment, or charge would necessarily and materially prejudice Mortgagor’s
prospects for success in such proceedings; and

 

 

(iii)    Nonpayment of such tax,
assessment, or charge will not result in the loss or forfeiture of any property
encumbered hereby or any interest of Mortgagee therein; and

 

(iv)    Mortgagor deposits with
Mortgagee, as security for such payment which may ultimately be required, a sum
equal to the amount of the disputed tax, assessment or charge plus the
interest, penalties, advertising charges, and other costs which Mortgagee
estimates are likely to become payable if Mortgagor’s contest is unsuccessful.

 

If Mortgagee determines that any one or more of such
conditions is not satisfied or is no longer satisfied, Mortgagor will pay the
tax, assessment, or charge in question, together with any interest and
penalties thereon, within ten (10) days after Mortgagee gives notice of such
determination.

 

4.5          Maintenance of
Insurance.

 

(a)           Coverages
Required.  Mortgagor shall maintain or
cause to be maintained, with financially sound and reputable insurance
companies or associations satisfactory to Mortgagee, all insurance required
under the terms of the Insurance Agreement, and shall comply with each and
every covenant and agreement contained in the Insurance Agreement.

 

(b)           Renewal Policies.  Not less than five (5) days prior to the
expiration date of each insurance policy required pursuant to the Insurance
Agreement, Mortgagor will deliver to Mortgagee an appropriate renewal binder or
policy (or a certified copy thereof), together with evidence satisfactory to
Mortgagee that the applicable premium has been prepaid, which evidence may
follow up to ten (10) days after such payment has been made.

 

(c)           Deposit for
Premiums.  Upon written demand made by
Mortgagee following the occurrence of any Event of Default, Mortgagor shall
deposit with Mortgagee an amount equal to 1/12th of the amount which Mortgagee
estimates will be required to make the next annual payments of the premiums for
the policies of insurance referred to in this Section, multiplied by the number
of whole and partial months which have elapsed since the date one month prior
to the most recent policy anniversary date for each such policy.  Thereafter, with each monthly payment under
the Note, Mortgagor will deposit an amount equal to 1/12th of the amount which
Mortgagee estimates will be required to pay the next required annual premium
for each insurance policy referred to in this Section.  The purpose of these provisions is to provide
Mortgagee with sufficient funds on hand to pay all such premiums thirty (30)
days before the date on which they become past due.  If the Mortgagee, in its sole discretion,
determines that the funds escrowed hereunder are, or will be, insufficient,
Mortgagor shall upon demand pay such additional sums as Mortgagee shall
determine necessary and shall pay any increased monthly charges requested by
Mortgagee.  Provided no Default or Event
of Default exists hereunder, Mortgagee will apply the amounts so deposited to
the payment of such insurance premiums when due, but in no event will Mortgagee
be liable for any interest on any amounts so deposited, and the money so
received may be held and commingled with Mortgagee’s own funds.

 

 

(d)           Application of Hazard
Insurance Proceeds.  Mortgagor shall
promptly notify Mortgagee of any damage or casualty to all or any portion of
the Property or Chattels.  Mortgagee may
participate in all negotiations and appear and participate in all judicial
arbitration proceedings concerning any insurance proceeds which may be payable
as a result of such casualty or damage, and may, in Mortgagee’s reasonable
discretion following any Event of Default, compromise or settle, in the name of
Mortgagee, Mortgagor, or both any claim for any such insurance proceeds.  Any such insurance proceeds in excess of
$500,000.00 shall be paid to Mortgagee and shall be applied first to reimburse
Mortgagee for all costs and expenses, including attorneys’ fees, incurred by
Mortgagee in connection with the collection of such insurance proceeds.  The balance of any insurance proceeds
received by Mortgagee with respect to an insured casualty may, in Mortgagee’s
sole discretion, either (i) be retained and applied by Mortgagee toward
payment of the Secured Obligations, or (ii) be paid over, in whole or in
part and subject to such commercially reasonable construction related
advancement conditions as Mortgagee may impose, to Mortgagor to pay for repairs
or replacements necessitated by the casualty; provided, however, that if all of
the Secured Obligations have been performed or are discharged by the
application of less than all of such insurance proceeds, then any remaining
proceeds will be paid over to Mortgagor. 
Notwithstanding the preceding sentence, if (A) no Default or Event
of Default shall exist hereunder, and (B) the proceeds received by
Mortgagee (together with any other funds delivered by Mortgagor to Mortgagee
for such purpose) shall be sufficient, in Mortgagee’s reasonable judgment, to
pay for any restoration necessitated by the casualty, and (C) either
Mortgagor is obligated under the terms of any Lease to restore or repair the
Property or the annual income from Leases that will survive restoration provide
a forward-looking Debt Service Coverage Ratio (as defined in the Agreement
Concerning Master Lease) of at least 1.05 upon completion of restoration, and Mortgagor
demonstrates to Mortgagee’s reasonable satisfaction that it will be able to
attain a forward-looking Debt Service Coverage Ration of at least 1.20 times
the annual debt service from Leases within six months after completion of
restoration, and (D) such restoration can be completed, in Mortgagee’s
judgment, at least ninety (90) days prior to the maturity date of the Note,
then Mortgagee shall apply such proceeds as provided in clause (ii) of the
preceding sentence.  Mortgagee will have
no obligation to see to the proper application of any insurance proceeds paid
over to Mortgagor, nor will any such proceeds received by Mortgagee bear
interest or be subject to any other charge for the benefit of Mortgagor.  Mortgagee may, prior to the application of insurance
proceeds, commingle them with Mortgagee’s own funds and otherwise act with
regard to such proceeds as Mortgagee may determine in Mortgagee’s sole
discretion.

 

(e)           Successor’s
Rights.  Any person who acquires title to
the Property or the Chattels upon foreclosure hereunder will succeed to all of
Mortgagor’s rights under all policies of insurance maintained pursuant to this
Section.

 

4.6          Maintenance and Repair
of Property and Chattels.  Mortgagor
will at all times maintain the Property and the Chattels in good condition and
repair, will diligently prosecute the completion of any building or other
improvement which is at any time in the process of construction on the
Property, and will promptly repair, restore, replace, or rebuild any part of
the Property or the Chattels which may be affected by any casualty or any
public or private taking or injury to the Property or the Chattels.  All costs and expenses arising out of the
foregoing shall be paid by Mortgagor whether or not the proceeds of any
insurance or eminent domain shall be sufficient therefor.  Mortgagor will comply with all statutes,
ordinances, and

 

 

other
governmental or quasi-governmental requirements and private covenants relating
to the ownership, construction, use, or operation of the Property, including
but not limited to any environmental or ecological requirements; provided, that
so long as Mortgagor is not otherwise in default hereunder, Mortgagor may, upon
providing Mortgagee with security reasonably satisfactory to Mortgagee, proceed
diligently and in good faith to contest the validity or applicability of any
such statute, ordinance, or requirement. 
Mortgagee and any person authorized by Mortgagee may enter and inspect
the Property at all reasonable times, and may inspect the Chattels, wherever
located, at all reasonable times.

 

4.7          Leases.  Mortgagor shall timely pay and perform each
of its obligations under or in connection with the Leases, and shall otherwise
pay such sums and take such action as shall be necessary or required in order
to maintain each of the Leases in full force and effect in accordance with its
terms.  Mortgagor shall immediately
furnish to Mortgagee copies of any notices given to Mortgagor by the lessee
under any Lease, alleging the default by Mortgagor in the timely payment or
performance of its obligations under such Lease and any subsequent
communication related thereto.  Mortgagor
agrees that Mortgagee, in its sole discretion, may advance any sum or take any
action which Mortgagee believes is necessary or required to maintain the Leases
in full force and effect, and all such sums advanced by Mortgagee, together
with all costs and expenses incurred by Mortgagee in connection with action
taken by Mortgagee pursuant to this Section, shall be due and payable by Mortgagor
to Mortgagee upon demand, shall bear interest until paid at the Default Rate
(as defined in the Note), and shall be secured by this Mortgage.

 

4.8          Eminent Domain; Private
Damage.  If all or any part of the
Property is taken or damaged by eminent domain or any other public or private
action, Mortgagor will notify Mortgagee promptly of the time and place of all
meetings, hearings, trials, and other proceedings relating to such action.  Mortgagee may participate in all negotiations
and appear and participate in all judicial or arbitration proceedings
concerning any award or payment which may be due as a result of such taking or
damage, and may, in Mortgagee’s reasonable discretion following any Event of
Default, compromise or settle, in the names of both Mortgagor and Mortgagee,
any claim for any such award or payment. 
Any such award or payment in excess of $500,000.00 is to be paid to
Mortgagee and will be applied first to reimburse Mortgagee for all costs and expenses,
including attorneys’ fees, incurred by Mortgagee in connection with the
ascertainment and collection of such award or payment.  The balance, if any, of such award or payment
may, in Mortgagee’s sole discretion, either (a) be retained by Mortgagee
and applied toward the Secured Obligations, or (b) be paid over, in whole
or in part and subject to such commercially reasonable construction related
advancement conditions as Mortgagee may impose, to Mortgagor for the purpose of
restoring, repairing, or rebuilding any part of the Property affected by the
taking or damage.  Notwithstanding the
preceding sentence, if (i) no Default or Event of Default shall have
occurred and be continuing hereunder, and (ii) the proceeds received by
Mortgagee (together with any other funds delivered by Mortgagor to Mortgagee
for such purpose) shall be sufficient, in Mortgagee’s reasonable judgment, to
pay for any restoration necessitated by the taking or damage, and
(iii) either Mortgagor is obligated under the terms of any Lease to
restore or repair the Property or the annual income from Leases that will
survive restoration provide a forward-looking Debt Service Coverage Ratio (as
defined in the Agreement Concerning Master Lease) of at least 1.05 upon
completion of restoration, and Mortgagor demonstrates to Mortgagee’s reasonable
satisfaction that it will be able to attain a forward-looking Debt Service
Coverage

 

 

Ration of at least 1.20 times the annual debt service
from Leases within six months after completion of restoration, and
(iv) such restoration can be completed, in Mortgagee’s judgment, at least
ninety (90) days prior to the maturity date of the Note, and (v) the
remaining Property shall constitute, in Mortgagee’s sole judgment, adequate
security for the Secured Obligations, then Mortgagee shall apply such proceeds
as provided in clause (b) of the preceding sentence.  Mortgagor’s duty to pay the Note in
accordance with its terms and to perform the other Secured Obligations will not
be suspended by the pendency or discharged by the conclusion of any proceedings
for the collection of any such award or payment, and any reduction in the
Secured Obligations resulting from Mortgagee’s application of any such award or
payment will take effect only when Mortgagee receives such award or
payment.  If this Mortgage has been
foreclosed prior to Mortgagee’s receipt of such award or payment, Mortgagee may
nonetheless retain such award or payment to the extent required to reimburse
Mortgagee for all costs and expenses, including attorneys’ fees, incurred in
connection therewith, and to discharge any deficiency remaining with respect to
the Secured Obligations.

 

4.9          Mechanics’ Liens.  Mortgagor will keep the Property free and
clear of all liens and claims of liens by contractors, subcontractors,
mechanics, laborers, materialmen, and other such persons, and will cause any
recorded statement of any such lien to be released of record within thirty (30)
days after the recording thereof. 
Notwithstanding the preceding sentence, however, Mortgagor will not be
deemed to be in default under this Section if and so long as Mortgagor
(a) contests in good faith the validity or amount of any asserted lien and
diligently prosecutes or defends an action appropriate to obtain a binding
determination of the disputed matter, (b) provides Mortgagee with such
security as Mortgagee may require to protect Mortgagee against all loss,
damage, and expense, including attorneys’ fees, which Mortgagee might incur if
the asserted lien is determined to be valid.

 

4.10        Defense of Actions.  Mortgagor will defend, at Mortgagor’s
expense, any action, proceeding or claim which affects any property encumbered
hereby or any interest of Mortgagee in such property or in the Secured
Obligations, and will indemnify and hold Mortgagee harmless from all loss,
damage, cost, or expense, including attorneys’ fees, which Mortgagee may incur
in connection therewith.

 

4.11        Expenses of Enforcement.  Mortgagor will pay all actual out-of-pocket
costs and expenses, including attorneys’ fees, which Mortgagee may incur in
connection with any effort or action (whether or not litigation or foreclosure
is involved) to enforce or defend Mortgagee’s rights and remedies under any of
the Loan Documents, including but not limited to all attorneys’ fees, appraisal
fees, consultants’ fees, and other expenses incurred by Mortgagee in securing
title to or possession of, and realizing upon, any security for the Secured
Obligations.  All such costs and expenses
(together with interest thereon at the Default Rate from the date incurred)
shall constitute part of the Secured Obligations, and may be included in the
computation of the amount owed to Mortgagee for purposes of foreclosing or
otherwise enforcing this Mortgage.

 

4.12        Financial Reports.  During the term of the Loan, Mortgagor shall
supply to Mortgagee (a) within thirty (30) days following the end of each
quarter, Mortgagor’s quarterly and annual operating statements for the Property
as of the end of and for the preceding quarter and fiscal year, as applicable,
in each case prepared against the budget for such year;

 

 

(b) contemporaneously
with Mortgagor’s delivery of each of such operating statements, a certified
rent roll signed and dated by Mortgagor detailing the names of all tenants
under the Leases, the portion of the improvements on the Property occupied by
each tenant, the rent and any other charges payable under each Lease, and the
term of each Lease; and (c) within one hundred five (105) days following
the end of each year, an annual balance sheet and profit and loss statement of
Mortgagor and the most recent 10K and 10Q filings of Guarantor.  The financial statements and reports for
Mortgagor described in (a) and (c) above shall be in such detail as Mortgagee
may require, shall be prepared in accordance with generally accepted accounting
principles consistently applied, and shall be certified as true and correct by
Mortgagor or the applicable Guarantor (or, if required by Mortgagee after any
Default or Event of Default, by an independent certified public accountant
acceptable to Mortgagee).  Mortgagor
shall also furnish to Mortgagee within thirty (30) days of Mortgagee’s request,
any other financial reports or statements of Mortgagor as Mortgagee may
request, provided, however, so long as Mortgagor’s sole asset is the Property,
Mortgagor may provide the annual balance sheet and profit and loss statement of
the Property in lieu of financial statements of Mortgagor.  Upon Mortgagee’s demand after any Default by
Mortgagor, Mortgagor shall supply to Mortgagee the items required in (a) and
(b) above on a monthly basis; such items shall be supplied to Mortgagee on a
quarterly basis upon Mortgagor’s cure of said default and Mortgagee’s written
authorization.  If Mortgagee securitizes
the Loan, Mortgagor shall supply to Mortgagee the items required in (a) and (b)
above on a quarterly basis.

 

4.13        Priority of Leases.  To the extent Mortgagor has the right, under
the terms of any Lease, to make such lease subordinate to the lien hereof,
Mortgagor will, at Mortgagee’s request and Mortgagor’s expense, take such
action as may be required to effect such subordination.  Conversely, Mortgagor will, at Mortgagee’s
request and Mortgagor’s expense, take such action as may be necessary to
subordinate the lien hereof to any future Lease designated by Mortgagee.

 

4.14        Inventories; Assembly of
Chattels.  Mortgagor will, from time
to time at the request of Mortgagee, supply Mortgagee with a current inventory
of the Chattels and the Intangible Personalty, in such detail as Mortgagee may
require.  Upon the occurrence of any
Event of Default hereunder, Mortgagor will at Mortgagee’s request assemble the
Chattels and make them available to Mortgagee at any place designated by
Mortgagee which is reasonably convenient to both parties.

 

4.15        Compliance with Laws, Etc.  Mortgagor shall comply in all material
respects with all applicable laws, rules, regulations and orders, such
compliance to include, without limitation, maintaining all Permits and paying
before the same become delinquent all taxes, assessments and governmental charges
imposed upon Mortgagor or the Property.

 

4.16        Records and Books of
Account.  Mortgagor shall keep
accurate and complete records and books of account, in which complete entries
will be made in accordance with generally accepted accounting principles
consistently applied, reflecting all financial transactions relating to the
Property.

 

4.17        Inspection Rights.  At any reasonable time, and from time to
time, Mortgagor shall permit Mortgagee, or any agents or representatives
thereof, to examine and

 

 

make
copies of and abstracts from the records and books of account of, and visit and
inspect the Property and to discuss with Mortgagor the affairs, finances and
accounts of Mortgagor.

 

4.18        Change of Mortgagor’s
Address or State of Organization. 
Mortgagor shall promptly notify Mortgagee if changes are made in
Mortgagor’s address from that set forth in Section 9.10
hereof, or if Mortgagor shall either change its “location” (as such term is
used in Section 5.8 hereof), its state of
organization or if Mortgagor shall organize in any state other than the State
of Connecticut.

 

4.19        Further Assurances;
Estoppel Certificates.  Mortgagor
will execute and deliver to Mortgagee upon demand, and pay the costs of
preparation and recording thereof, any further documents which Mortgagee may
request to confirm or perfect the liens and security interests created or
intended to be created hereby, or to confirm or perfect any evidence of the
Secured Obligations.  Mortgagor will
also, within ten (10) days after any request by Mortgagee, deliver to Mortgagee
a signed and acknowledged statement certifying to Mortgagee, or to any proposed
transferee of the Secured Obligations, (a) the balance of principal,
interest, and other sums then outstanding under the Note, and (b) whether
Mortgagor claims to have any offsets or defenses with respect to the Secured
Obligations and, if so, the nature of such offsets or defenses.

 

4.20        Costs of Closing.  Mortgagor shall on demand pay directly or
reimburse Mortgagee for any costs or expenses pertaining to the closing of the
Loan, including, but not limited to, reasonable fees of counsel for Mortgagee,
costs and expenses for which invoices were not available at the closing of the
Loan, or costs and expenses which are incurred by Mortgagee after such
closing.  All such costs and expenses
(together with interest thereon at the Default Rate from the date of demand if
such amounts are not paid within fifteen (15) days of the date of demand) shall
constitute a part of the Secured Obligations, and may be included in the
computation of the amount owed to Mortgagee for purposes of foreclosing or
otherwise enforcing this Mortgage.

 

4.21        Fund for Electronic
Transfer.  All monthly payments of
principal and interest on the Note, and escrow deposits under this Mortgage,
shall be made by Mortgagor by electronic funds transfer from a bank account
established and maintained by Mortgagor for such purpose.  Mortgagor shall establish and maintain such
an account until the Note is fully paid and shall direct the depository of such
account in writing to so transmit such payments on or before the respective due
dates to the account of Mortgagee as shall be designated by Mortgagee in
writing.

 

4.22        Use.  Mortgagor shall use the Property solely for
the operation of an industrial distribution center and any other use permitted
by zoning and other law and for no other use or purpose.

 

4.23        Management.  The Property shall be managed by Mortgagor or
Guarantor.  Mortgagor shall not permit
management of the Property by any person or entity other than Mortgagor or
Guarantor, without the prior written consent of Mortgagee.  If the Property is managed by Guarantor,
Mortgagor shall not enter into any property management agreement which would
not be terminable on thirty (30) days’ notice to Guarantor.

 

 

ARTICLE 5

MORTGAGOR’S NEGATIVE COVENANTS

 

5.1          Waste and Alterations.  Mortgagor will not commit or permit any waste
with respect to the Property or the Chattels. 
Mortgagor shall not cause or permit any part of the Property, including
but not limited to any building, structure, parking lot, driveway, landscape
scheme, timber, or other ground improvement, to be removed, demolished, or
materially altered without the prior written consent of Mortgagee.

 

5.2          Zoning and Private
Covenants.  Mortgagor will not
initiate, join in, or consent to any change in any zoning ordinance or
classification, any change in the “zone lot” or “zone lots” (or similar zoning
unit or units) presently comprising the Property, any transfer of development
rights, any private restrictive covenant, or any other public or private
restriction limiting or defining the uses which may be made of the Property or
any part thereof, without the express written consent of Mortgagee.  If under applicable zoning provisions the use
of all or any part of the Property is or becomes a nonconforming use, Mortgagor
will not cause such use to be discontinued or abandoned without the express
written consent of Mortgagee, and Mortgagor will use its best efforts to
prevent the tenant under any Lease from discontinuing or abandoning such use.

 

5.3          Interference with
Leases.

 

(a)           Mortgagor will neither
do, nor neglect to do, anything which may cause or permit the termination of
any Lease of all or any part of the Property, or permit the withholding or
abatement of any rent payable under any such Lease.

 

(b)           Without Mortgagee’s
prior written consent, which may be granted or withheld in Mortgagee’s
reasonable discretion, Mortgagor shall not enter into or modify any Lease of
all or any part of the Property.  Any
submission by Mortgagor for Mortgagee’s approval of a Lease or modification
thereof shall be accompanied by a copy of such Lease or modification, a Lease
abstract, a then-current rent roll for the Property, year-to-date and prior
year operating statements for the Property, and a cover letter requesting
Mortgagee’s approval which contains a signature line on which Mortgagee may
evidence its approval of such Lease or modification.

 

(c)           Except with the prior
written consent of Mortgagee, which may be granted or withheld in Mortgagee’s
sole discretion, Mortgagor will not (i) collect rent from all or any part
of the Property for more than one month in advance, (ii) assign the rents
from the Property or any part thereof, or (iii) consent to the cancellation
or surrender of all or any part of any Lease, except that Mortgagor may in good
faith terminate any Lease for nonpayment of rent or other material breach by
the tenant.

 

(d)           Notwithstanding the
provisions of Section 5.3(b) to the
contrary, Mortgagor shall have the right to enter into “Safe-Harbor Leases” (as
hereinafter defined) without Mortgagee’s prior written consent.  A “Safe Harbor Lease” shall mean any proposed
market Lease that meets the following criteria: (i) the rent payable under
such proposed Lease is a rent that is no less than $6.00 per square foot on a
triple-net basis, (ii) the rentable area to be

 

 

demised
pursuant to such proposed Lease which, when combined with any other space in
the Property leased to affiliated entities of the tenant under such proposed
Safe Harbor Lease, is less than 25,000 square feet, (iii) such Lease
shall be for a term of no less than three (3) years and no greater than ten
(10) years, including any tenant extension option(s); provided, however, that
the term, including any extension options, may extend to fifteen (15) years if
lease years 11-15 have a rental rate not less than the greater of
(A) the rental rate for year 10 and (B) market rental rate,
(iv) the tenant improvement allocation or allowance shall not exceed
$10.00 per rentable square foot, unless Guarantor guarantees the payment of
such allocation or allowance in excess of $10.00 per rentable square foot, and
(v) such lease shall satisfy the additional leasing guidelines set forth
in Section 5.3(e) below:

 

(e)           A Lease will qualify as
a Safe-Harbor Lease when such Lease comes into effect, provided each of the
following conditions, in addition to the ones set forth above, are satisfied:
(i) such Lease does not contain any options to purchase, or other rights
to acquire the Property, (ii) such Lease does not contain any material
restrictions on Mortgagor’s rights to lease remaining portions of the Property;
provided, however, that the granting of the right or option to lease additional
space within the Property upon terms which would otherwise comply with the
provisions of this Section 5.3
shall not be considered a material restriction, if such right or option must be
exercised upon 15 days’ notice to the tenant, (iii) such Lease does
not contain any extraordinary, uncustomary, and unduly burdensome Mortgagor
obligations (including obligations which an unaffiliated Mortgagor would have
difficulty performing), (iv) such Lease is entered into on the standard
form of Lease, without material modification thereto and provided it conforms
with the leasing guidelines hereunder, (v) such Lease is entered into on
arms-length terms, and (vi) within ten (10) days following the execution
of such Lease, Mortgagor shall provide Mortgagee with a certified copy thereof
and a certificate that such Lease complies in all respects with the
requirements of a Safe Harbor Lease.

 

(f)            Mortgagee agrees that
for any proposed Lease that does not qualify as a Safe Harbor Lease, for which
Mortgagor is required to obtain Mortgagee’s consent thereto, Mortgagee will
attempt to respond within ten (10) business days.  If Mortgagee has failed to respond to the
written request for consent of a proposed Lease after ten (10) business days
after its receipt thereof, together with any additional information that
Mortgagee may reasonably require to evaluate such proposed lease, and Mortgagor
has provided a subsequent five (5) business days’ written notice to Mortgagee
requesting consent, each notice marked with a legend in bold capital letters
stating: MORTGAGEE SHALL BE DEEMED TO HAVE CONSENTED TO THE
MATTER CONTAINED HEREIN IF IT FAILS TO RESPOND TO THIS REQUEST FOR CONSENT
WITHIN [10/5 (as applicable)] BUSINESS DAYS AFTER THE DATE HEREOF,
then Mortgagee shall be deemed to have consented to the same.  Mortgagee agrees to consider a written
summary of a proposed lease to a specific tenant in accordance with the terms
described in this Section 5.3(f).  If Mortgagee approves a written summary (or
is deemed to have given its approval), Mortgagee shall be deemed to have
approved a lease to that tenant prepared in accordance with such written
summary on the form previously approved by Mortgagee, without material
modifications (except as disclosed in the written summary).

 

 

5.4          Transfer or Further
Encumbrance of Property.

 

(a)           Without Mortgagee’s
prior written consent, which consent may be granted or withheld in Mortgagee’s
sole and absolute discretion, Mortgagor shall not, except as permitted in Section 5.3, (i) sell, assign, convey, transfer or
otherwise dispose of any legal, beneficial or equitable interest in any of the
Property, (ii) permit or suffer any owner, directly or indirectly, of any
beneficial interest in the Property or Mortgagor to transfer such interest,
whether by transfer of partnership, membership, stock or other beneficial
interest in any entity or otherwise, or (iii) mortgage, hypothecate or
otherwise encumber or permit to be encumbered or grant or permit to be granted
a security interest in all or any part of the Property or Mortgagor or any
beneficial or equitable interest in either the Property or Mortgagor.  The provisions of this Section shall not
prohibit transfers of title or interest under any will or testament or
applicable law of descent.

 

(b)           Notwithstanding the
provisions of Section 5.4(a) to the
contrary, Mortgagor may transfer the Property or any beneficial interest in
Mortgagor provided that (i) the transferee of the Property (in the case of
a transfer of the Property) or the surviving entity (in the case of a transfer
of any beneficial interest in Mortgagor) is a wholly owned subsidiary of
Guarantor (and such other entity shall be a single purpose entity and shall
expressly assume the obligations of Borrower under the Loan Documents in
documentation satisfactory to Lender in form and content) and
(ii) immediately before and immediately after giving effect to such
transaction, no Event of Default, and no event which, after notice or lapse of
time or both, would become an Event of Default, shall have occurred and be continuing.  Mortgagor shall be responsible for all
out–of–pocket expenses incurred by Mortgagee in connection with such transfer,
including without limitation reasonable attorney’s fees.

 

(c)           Notwithstanding the
provisions of Section 5.4(a), so long as
(i) Mortgagor is a wholly owned subsidiary of Guarantor and Guarantor
controls Mortgagor and (ii) Guarantor is an Independent Publicly Traded
Entity, there shall be no restrictions on the sale or transfer of stock in
Guarantor.  As used herein, the term “Independent
Publicly Traded Entity” means a corporation (1) whose stock is publicly
traded on the New York Stock Exchange, American Stock Exchange, NASDAQ market
or similar national or nationally recognized stock exchange or over the counter
market and (2) is not a subsidiary of another entity.  Notwithstanding the provisions of Section 5.4(a) and (b), Guarantor
may enter into any merger, consolidation or reorganization, provided that the
surviving entity following any such merger, consolidation or reorganization
(A) is an Independent Publicly Traded Entity and (B) the net worth of
the surviving entity (as determined by an independent certified public
accounting firm) is equal to or greater than the greater of (I) the net
worth of Guarantor as of the date of the closing of the Loan and (II) the
net worth of Guarantor immediately prior to the consummation of such merger,
consolidation or reorganization.

 

5.5          Further Encumbrance of
Chattels.  Mortgagor will neither
create nor permit any lien, security interest or encumbrance against the
Chattels or Intangible Personalty or any part thereof or interest therein,
other than the liens and security interests created by the Loan Documents,
without the prior written consent of Mortgagee, which may be withheld for any
reason.

 

 

5.6          Assessments Against
Property.  Mortgagor will not,
without the prior written approval of Mortgagee, which may be withheld for any
reason, consent to or allow the creation of any so-called special districts,
special improvement districts, benefit assessment districts or similar
districts, or any other body or entity of any type, or allow to occur any other
event, that would or might result in the imposition of any additional taxes,
assessments or other monetary obligations or burdens on the Property, and this
provision shall serve as RECORD NOTICE to any such district or districts or any
governmental entity under whose authority such district or districts exist or
are being formed that, should Mortgagor or any other person or entity include
all or any portion of the Property in such district or districts, whether
formed or in the process of formation, without first obtaining Mortgagee’s
express written consent, the rights of Mortgagee in the Property pursuant to
this Mortgage or following any foreclosure of this Mortgage, and the rights of
any person or entity to whom Mortgagee might transfer the Property following a
foreclosure of this Mortgage, shall be senior and superior to any taxes,
charges, fees, assessments or other impositions of any kind or nature whatsoever,
or liens (whether statutory, contractual or otherwise) levied or imposed, or to
be levied or imposed, upon the Property or any portion thereof as a result of
inclusion of the Property in such district or districts.

 

5.7          Transfer or Removal of
Chattels.  Mortgagor will not sell,
transfer or remove from the Property all or any part of the Chattels with a
value in excess of $25,000.00, unless the items sold, transferred, or removed
are simultaneously replaced with similar items of equal or greater value.

 

5.8          Change of Name,
Organizational I.D. No. or Location. 
Mortgagor will not change the name under which Mortgagor does business
(or adopt or begin doing business under any other name or assumed or trade
name), change its organizational identification number, or change its location,
without first notifying Mortgagee of Mortgagor’s intention to do so and
delivering to Mortgagee such organizational documents of Mortgagor and executed
modifications or supplements to this Mortgage (and to any financing statement
which may be filed in connection herewith) as Mortgagee may require.  For purposes of the foregoing, Mortgagor’s “location”
shall mean (a) if Mortgagor is a registered organization, Mortgagor’s
state of registration, (b) if Mortgagor is an individual, the state of
Mortgagor’s principal residence, or (c) if Mortgagor is neither a
registered organization nor an individual, the state in which Mortgagor’s place
of business (or, if Mortgagor has more than one place of business, the
Mortgagor’s chief executive office) is located.

 

5.9          Improper Use of Property
or Chattels.  Mortgagor will not use
the Property or the Chattels for any purpose or in any manner which violates
any applicable law, ordinance, or other governmental requirement, the
requirements or conditions of any insurance policy, or any private covenant.

 

5.10        ERISA.  Mortgagor shall not engage in any transaction
which would cause the Note (or the exercise by Mortgagee of any of its rights
under the Loan Documents) to be a non-exempt, prohibited transaction under
ERISA (including for this purpose the parallel provisions of Section 4975
of the Internal Revenue Code of 1986, as amended), or otherwise result in
Mortgagee being deemed in violation of any applicable provisions of ERISA.  Mortgagor shall indemnify, protect, defend,
and hold Mortgagee harmless from and against any and all losses, liabilities,
damages, claims, judgments, costs, and expenses (including, without

 

 

limitation
attorneys’ fees and costs incurred in the investigation, defense, and
settlement of claims and in obtaining any individual ERISA exemption or state
administrative exception that may be required, in Mortgagee’s sole and absolute
discretion) that Mortgagee may incur, directly or indirectly, as the result of
the breach by Mortgagor of any warranty or representation set forth in Section 3.3(x) hereof or the breach by Mortgagor of any
covenant contained in this Section.  This
indemnity shall survive any termination, satisfaction or foreclosure of this
Mortgage and shall not be subject to the limitation on personal liability
described in the Note.

 

5.11        Use of Proceeds.  Mortgagor will not use any funds advanced by
Mortgagee under the Loan Documents for household or agricultural purposes, to
purchase margin stock, or for any purpose prohibited by law.

 

ARTICLE 6

EVENTS OF DEFAULT

 

Each of the following events will constitute an event
of default (an “Event of Default”) under this Mortgage and under each of the
other Loan Documents:

 

6.1          Failure to Pay Note.  Mortgagor’s failure to make any payment when
due under the terms of the Note or any other Loan Document.

 

6.2          Due on Sale or
Encumbrance.  The occurrence of any
violation of any covenant contained in Section 5.4, 5.5 or 5.7 hereof.

 

6.3          Other Obligations.  The failure of Mortgagor to properly perform
any obligation contained herein or in any of the other Loan Documents (other
than the obligation to make payments under the Note or the other Loan
Documents) and the continuance of such failure for a period of ten (10) days
following written notice thereof from Mortgagee to Mortgagor; provided,
however, that if such failure is not curable within such ten (10) day period,
then, so long as Mortgagor commences to cure such failure within such ten (10)
day period and is continually and diligently attempting to cure to completion,
such failure shall not be an Event of Default unless such failure remains
uncured for thirty (30) days after such written notice to Mortgagor.

 

6.4          Levy Against Property.  The levy against any of the Property, Chattels
or Intangible Personalty, of any execution, attachment, sequestration or other
writ.

 

6.5          Liquidation.  The liquidation, termination or dissolution
of Mortgagor or any Controlling Person.

 

6.6          Appointment of Receiver.  The appointment of a trustee or receiver for
the assets, or any part thereof, of Mortgagor or any Controlling Person, or the
appointment of a trustee or receiver for any real or personal property, or the
like, or any part thereof, representing the security for the Secured Obligations.

 

6.7          Assignments.  The making by Mortgagor or any Controlling
Person of a transfer in fraud of creditors or an assignment for the benefit of
creditors.

 

 

6.8          Order for Relief.  The entry in bankruptcy of an order for
relief for or against Mortgagor or any Controlling Person.

 

6.9          Bankruptcy.  The filing of any petition (or answer
admitting the material allegations of any petition), or other pleading, seeking
entry of an order for relief for or against Mortgagor or any Controlling Person
as a debtor or bankrupt or seeking an adjustment of any of such parties’ debts,
or any other relief under any state or federal bankruptcy, reorganization,
debtor’s relief or insolvency laws now or hereafter existing, including,
without limitation, a petition or answer seeking reorganization or admitting
the material allegations of a petition filed against any such party in any
bankruptcy or reorganization proceeding, or the act of any of such parties in
instituting or voluntarily being or becoming a party to any other judicial
proceedings intended to effect a discharge of the debts of any such parties, in
whole or in part, or a postponement of the maturity or the collection thereof,
or a suspension of any of the rights or powers of a trustee or of any of the
rights or powers granted to Mortgagee herein, or in any other document executed
in connection herewith.

 

6.10        Misrepresentation.  If any representation or warranty made by
Mortgagor or any Controlling Person, or in any of the other Loan Documents or
any other instrument or document modifying, renewing, extending, evidencing,
securing or pertaining to the Note is false, misleading or erroneous in any
material respect.

 

6.11        Judgments.  Unless a bond or other acceptable security is
posted with Mortgagee (or, if applicable, a court of competent jurisdiction),
the failure of Mortgagor or any Controlling Person to pay any monetary judgment
in excess of $50,000.00 before the expiration of thirty (30) days after such
judgment becomes final and no longer appealable.

 

6.12        Admissions Regarding
Debts.  The admission of Mortgagor or
any Controlling Person in writing of any such party’s inability to pay such
party’s debts as they become due.

 

6.13        Assertion of Priority.  The assertion of any claim of priority over
this Mortgage, by title, lien, or otherwise, unless Mortgagor within thirty
(30) days after such assertion either causes the assertion to be withdrawn or
provides Mortgagee with such security as Mortgagee may require to protect
Mortgagee against all loss, damage, or expense, including attorneys’ fees,
which Mortgagee may incur in the event such assertion is upheld; provided,
however, that the written agreement in form and content acceptable to Mortgagee
from a title company acceptable to Mortgagee to defend Mortgagee against such
assertion and to insure against any such loss, damage or exchange shall
constitute adequate security.

 

6.14        Other Loan Documents.  The occurrence of any default by Mortgagor,
after the lapse of any applicable grace or cure period, or the occurrence of any
event or circumstance defined as an Event of Default, under any of the Loan
Documents other than this Mortgage.

 

6.15        Other Liens.  The occurrence of any default by Mortgagor,
after the lapse of any applicable grace or cure period, or the occurrence of any
event or circumstance defined as an Event of Default, under any other
consensual lien encumbering the Property, or any part

 

 

thereof or interest therein, or any document or
instrument evidencing obligations secured thereby.

 

6.16        Other Indebtedness.  The occurrence of any default by Mortgagor,
after the lapse of any applicable grace or cure period, or the occurrence of
any event or circumstance defined as an Event of Default, under any other
indebtedness incurred or owing by Mortgagor, or any document or instrument
evidencing any obligation to pay such indebtedness.

 

ARTICLE 7

MORTGAGEE’S REMEDIES

 

Immediately upon or any time after the occurrence of
any Event of Default hereunder, Mortgagee may exercise any remedy available at
law or in equity, including but not limited to those listed below and those
listed in the other Loan Documents, in such sequence or combination as
Mortgagee may determine in Mortgagee’s sole discretion:

 

7.1          Performance of Defaulted
Obligations.  Mortgagee may make any
payment or perform any other obligation under the Loan Documents which
Mortgagor has failed to make or perform, and Mortgagor hereby irrevocably
appoints Mortgagee as the true and lawful attorney-in-fact for Mortgagor to
make any such payment and perform any such obligation in the name of
Mortgagor.  All payments made and
expenses (including attorneys’ fees) incurred by Mortgagee in this connection,
together with interest thereon at the Default Rate from the date paid or
incurred until repaid, will be part of the Secured Obligations and will be
immediately due and payable by Mortgagor to Mortgagee.  In lieu of advancing Mortgagee’s own funds
for such purposes, Mortgagee may use any funds of Mortgagor which may be in
Mortgagee’s possession, including but not limited to insurance or condemnation
proceeds and amounts deposited for taxes, insurance premiums, or other
purposes.

 

7.2          Specific Performance and
Injunctive Relief.  Notwithstanding
the availability of legal remedies, Mortgagee will be entitled to obtain
specific performance, mandatory or prohibitory injunctive relief, or other
equitable relief requiring Mortgagor to cure or refrain from repeating any
Default.

 

7.3          Acceleration of Secured
Obligations.  Mortgagee may, without
notice or demand, declare all of the Secured Obligations immediately due and
payable in full.

 

7.4          Suit for Monetary
Relief.  Subject to the non-recourse
provisions of the Note, with or without accelerating the maturity of the
Secured Obligations, Mortgagee may sue from time to time for any payment due
under any of the Loan Documents, or for money damages resulting from Mortgagor’s
default under any of the Loan Documents.

 

7.5          Possession of Property.  To the extent permitted by law, Mortgagee may
enter and take possession of the Property without seeking or obtaining the
appointment of a receiver, may employ a managing agent for the Property, and
may lease or rent all or any part of the Property, either in Mortgagee’s name
or in the name of Mortgagor, and may collect the rents, issues, and profits of
the Property.  Any revenues collected by
Mortgagee under this Section will be applied first toward payment of all
expenses (including attorneys’ fees) incurred by Mortgagee, together with
interest thereon at the Default Rate from the date incurred until repaid,

 

 

and
the balance, if any, will be applied against the Secured Obligations in such
order and manner as Mortgagee may elect in its sole discretion.

 

7.6          Enforcement of Security
Interests.  Mortgagee may exercise
all rights of a secured party under the Code with respect to the Chattels and
the Intangible Personalty, including but not limited to taking possession of,
holding, and selling the Chattels and enforcing or otherwise realizing upon any
accounts and general intangibles.  Any
requirement for reasonable notice of the time and place of any public sale, or
of the time after which any private sale or other disposition is to be made,
will be satisfied by Mortgagee’s giving of such notice to Mortgagor at least
five (5) days prior to the time of any public sale or the time after which any
private sale or other intended disposition is to be made.

 

7.7          Foreclosure Against
Property.

 

(a)           Mortgagee may bring an
action in any court of competent jurisdiction to foreclose this Mortgage.

 

(b)           All fees, costs and
expenses of any kind incurred by Mortgagee in connection with foreclosure of
this Mortgage, including, without limitation, the costs of any appraisals of
the Property obtained by Mortgagee, the cost of any title reports or abstracts,
all costs of any receivership for the Property advanced by Mortgagee, and all
attorneys’ and consultants’ fees and expenses incurred by Mortgagee, shall
constitute a part of the Secured Obligations and may be included as part of the
amount owing from Mortgagor to Mortgagee at any foreclosure sale.

 

(c)           The proceeds of any
sale under this Section shall be applied first to the fees and expenses of
the officer conducting the sale, and then to the reduction or discharge of the
Secured Obligations in such order and manner as Mortgagee may elect in its sole
discretion; any surplus remaining shall be paid over to Mortgagor or to such
other person or persons as may be lawfully entitled to such surplus.

 

(d)           Nothing in this Section dealing
with foreclosure procedures or specifying particular actions to be taken by
Mortgagee shall be deemed to contradict or add to the requirements and
procedures now or hereafter specified by the laws of the State, and any such
inconsistency shall be resolved in favor of the State’s law applicable at the
time of foreclosure.

 

7.8          Appointment of Receiver.  To the extent permitted by law, Mortgagee
shall be entitled, as a matter of absolute right and without regard to the
value of any security for the Secured Obligations or the solvency of any person
liable therefor, and with or without taking possession of the Property, to the
appointment of a receiver for the Property upon ex-parte application to any
court of competent jurisdiction. 
Mortgagor waives any right to any hearing or notice of hearing prior to the
appointment of a receiver.  Such receiver
and its agents shall be empowered to (a) take possession of the Property
and any businesses conducted by Mortgagor or any other person thereon and any
business assets used in connection therewith, (b) exclude Mortgagor and
Mortgagor’s agents, servants, and employees from the Property, (c) collect
the rents, issues, profits, and income therefrom, (d) complete any
construction which may be in

 

 

progress,
(e) do such maintenance and make such repairs and alterations as the
receiver deems necessary, (f) use all stores of materials, supplies, and
maintenance equipment on the Property and replace such items at the expense of
the receivership estate, (g) pay all taxes and assessments against the
Property and the Chattels, all premiums for insurance thereon, all utility and
other operating expenses, and all sums due under any prior or subsequent
encumbrance, and (h) generally do anything which Mortgagor could legally
do if Mortgagor were in possession of the Property.  All expenses incurred by the receiver or its
agents shall constitute a part of the Secured Obligations.  Any revenues collected by the receiver shall
be applied first to the expenses of the receivership, including attorneys’ fees
incurred by the receiver and by Mortgagee, together with interest thereon at
the Default Rate from the date incurred until repaid, and the balance shall be
applied toward the Secured Obligations in such order or manner as Mortgagee may
in its sole discretion elect or in such other manner as the court may
direct.  Unless sooner terminated with
the express consent of Mortgagee, any such receivership will continue until the
Secured Obligations have been discharged in full, or until title to the Property
has passed after foreclosure sale and all applicable periods of redemption have
expired.

 

7.9          Right to Make Repairs,
Improvements.  Should any part of the
Property come into the possession of Mortgagee, whether before or after an
Event of Default, Mortgagee may use, operate, and/or make repairs, alterations,
additions and improvements to the Property for the purpose of preserving it or
its value.  Mortgagor covenants to
promptly reimburse and pay to Mortgagee, at the place where the Note is
payable, or at such other place as may be designated by Mortgagee in writing,
the amount of all reasonable expenses (including the cost of any insurance,
taxes, or other charges) incurred by Mortgagee in connection with its custody,
preservation, use or operation of the Property, together with interest thereon
from the date incurred by Mortgagee at the Default Rate, and all such expenses,
costs, taxes, interest, and other charges shall be a part of the Secured
Obligations.  It is agreed, however, that
the risk of accidental loss or damage to the Property is undertaken by
Mortgagor and Mortgagee shall have no liability whatsoever for decline in value
of the Property, for failure to obtain or maintain insurance, or for failure to
determine whether any insurance ever in force is adequate as to amount or as to
the risks insured.

 

7.10        Surrender of Insurance.  Mortgagee may surrender the insurance
policies maintained pursuant to the terms hereof, or any part thereof, and
receive and apply the unearned premiums as a credit on the Secured Obligations
and, in connection therewith, Mortgagor hereby appoints Mortgagee (or any
officer of Mortgagee), as the true and lawful agent and attorney-in-fact for
Mortgagor (with full powers of substitution), which power of attorney shall be
deemed to be a power coupled with an interest and therefore irrevocable, to
collect such premiums.

 

7.11        Prima Facie Evidence.  Mortgagor agrees that, in any assignments,
deeds, bills of sale, notices of sale, or postings, given by Mortgagee, any and
all statements of fact or other recitals therein made as to the identity of
Mortgagee, or as to the occurrence or existence of any Event of Default, or as
to the acceleration of the maturity of the Secured Obligations, or as to the
request to sell, posting of notice of sale, notice of sale, time, place, terms
and manner of sale and receipt, distribution and application of the money
realized therefrom, and without being limited by the foregoing, as to any other
act or thing having been duly done by Mortgagee, shall be taken by all courts
of law and equity as prima facie
evidence that such statements or recitals

 

 

state
facts and are without further question to be so accepted, and Mortgagor does
hereby ratify and confirm any and all acts that Mortgagee may lawfully do by
virtue hereof.

 

ARTICLE 8

ASSIGNMENT OF LEASES AND RENTS

 

8.1          Assignment of Leases and
Rents.  Mortgagor hereby
unconditionally and absolutely grants, transfers and assigns unto Mortgagee all
rents, royalties, issues, profits and income (“Rents”) now or hereafter due or
payable to Mortgagor for the occupancy or use of the Property, and all Leases
(other than subleases), whether written or oral, with all security therefor,
including all guaranties thereof, now or hereafter affecting the Property;
reserving unto Mortgagor, however, a license to collect and retain such Rents
prior to the occurrence of any Event of Default.  Such license shall be revocable by Mortgagee
without notice to Mortgagor at any time after the occurrence of an Event of
Default.  Mortgagor represents that
Mortgagor’s interest in the Rents and the Leases have not been heretofore sold,
assigned, transferred or set over by any instrument now in force and will not
at any time during the life of this assignment be sold, assigned, transferred
or set over by Mortgagor or by any person or persons whomsoever; and Mortgagor
has good right to sell, assign, transfer and set over the same and to grant to
and confer upon Mortgagee the rights, interest, powers and authorities herein
granted and conferred.  Failure of
Mortgagee at any time or from time to time to enforce the assignment of Rents
and Leases under this Section shall not in any manner prevent its
subsequent enforcement, and Mortgagee is not obligated to collect anything
hereunder, but is accountable only for sums actually collected.

 

8.2          Further Assignments.  Mortgagor shall give Mortgagee at any time
upon demand any further or additional forms of assignment or transfer of such
Rents, Leases and security as may be reasonably requested by Mortgagee, and
shall deliver to Mortgagee executed copies of all such Leases and security.

 

8.3          Application of Rents.  Mortgagee shall be entitled to deduct and
retain a just and reasonable compensation from monies received hereunder for
its services or that of its agents in collecting such monies.  Any monies received by Mortgagee hereunder
may be applied when received from time to time in payment of any taxes,
assessments or other liens affecting the Property regardless of the
delinquency, such application to be in such order as Mortgagee may
determine.  The acceptance of this
Mortgage by Mortgagee or the exercise of any rights by it hereunder shall not
be, or be construed to be, an affirmation by it of any Lease nor an assumption
of any liability under any Lease.

 

8.4          Collection of Rents.  Upon or at any time after an Event of Default
shall have occurred and be continuing, Mortgagee may declare all sums secured
hereby immediately due and payable, and may, at its option, without notice, and
whether or not the Secured Obligations shall have been declared due and
payable, either in person or by agent, with or without bringing any action or
proceeding, or by a receiver to be appointed by a court, (a) enter upon,
take possession of, manage and operate the Property, or any part thereof (including
without limitation making necessary repairs, alterations and improvements to
the Property); (b) make, cancel, enforce or modify Leases; (c) obtain
and evict tenants; (d) fix or modify Rents; (e) do any acts which
Mortgagee deems reasonably proper to protect the security thereof; and

 

 

(f) either
with or without taking possession of the Property, in its own name sue for or
otherwise collect and receive such Rents, including those past due and
unpaid.  In connection with the
foregoing, Mortgagee shall be entitled and empowered to employ attorneys, and
management, rental and other agents in and about the Property and to effect the
matters which Mortgagee is empowered to do, and in the event Mortgagee shall
itself effect such matters, Mortgagee shall be entitled to charge and receive
reasonable management, rental and other fees therefor as may be customary in
the area in which the Property is located; and the reasonable fees, charges,
costs and expenses of Mortgagee or such persons shall be additional Secured Obligations.  Mortgagee may apply all funds collected as
aforesaid, less costs and expenses of operation and collection, including
reasonable attorneys’ and agents’ fees, charges, costs and expenses, as
aforesaid, upon any Secured Obligations, and in such order as Mortgagee may
determine.  The entering upon and taking
possession of the Property, the collection of such Rents and the application
thereof as aforesaid shall not cure or waive any default or waive, modify or affect
notice of default under the Note or this Mortgage or invalidate any act done
pursuant to such notice.

 

8.5          Authority of Mortgagee.  Any tenants or occupants of any part of the
Property are hereby authorized to recognize the claims of Mortgagee hereunder
without investigating the reason for any action taken by Mortgagee, or the
validity or the amount of secured obligations owing to Mortgagee, or the
existence of any default in the Note or this Mortgage, or under or by reason of
this assignment of Rents and Leases, or the application to be made by Mortgagee
of any amounts to be paid to Mortgagee. 
The sole signature of Mortgagee shall be sufficient for the exercise of
any rights under this assignment and the sole receipt of Mortgagee for any sums
received shall be a full discharge and release therefor to any such tenant or
occupant of the Property.  Checks for all
or any part of the rentals collected under this assignment of Rents and Leases
shall be drawn to the exclusive order of Mortgagee.

 

8.6          Indemnification of
Mortgagee.  Nothing herein contained
shall be deemed to obligate Mortgagee to perform or discharge any obligation,
duty or liability of any lessor under any Lease of the Property, and Mortgagor
shall and does hereby indemnify and hold Mortgagee harmless from any and all
liability, loss or damage which Mortgagee may or might incur under any Lease or
by reason of the assignment; and any and all such liability, loss or damage
incurred by Mortgagee, together with the costs and expenses, including
reasonable attorneys’ fees, incurred by Mortgagee in defense of any claims or
demands therefor (whether successful or not), shall be additional Secured
Obligations, and Mortgagor shall reimburse Mortgagee therefor on demand.

 

ARTICLE 9

MISCELLANEOUS PROVISIONS

 

9.1          Time of the Essence.  Time is of the essence with respect to all of
Mortgagor’s obligations under the Loan Documents.

 

9.2          Joint and Several
Obligations.  If Mortgagor is more
than one person or entity, then (a) all persons or entities comprising
Mortgagor are jointly and severally liable for all of the Secured Obligations;
(b) all representations, warranties, and covenants made by Mortgagor shall
be deemed representations, warranties, and covenants of each of the persons or
entities comprising Mortgagor; (c) any breach, Default or Event of Default
by any of the persons or

 

 

entities
comprising Mortgagor hereunder shall be deemed to be a breach, Default, or
Event of Default of Mortgagor; (d) any reference herein contained to the
knowledge or awareness of Mortgagor shall mean the knowledge or awareness of
any of the persons or entities comprising Mortgagor; and (e) any event
creating personal liability of any of the persons or entities comprising
Mortgagor shall create personal liability for all such persons or entities.

 

9.3          Waiver of Homestead and
Other Exemptions.  To the extent
permitted by law, Mortgagor hereby waives all rights to any homestead or other
exemption to which Mortgagor would otherwise be entitled under any present or
future constitutional, statutory, or other provision of applicable state or
federal law.  Mortgagor hereby waives any
right it may have to require Mortgagee to marshal all or any portion of the
security for the Secured Obligations.

 

9.4          Non-Recourse; Exceptions
to Non-Recourse.  Except as expressly
set forth in the Note, the recourse of Mortgagee with respect to the
obligations evidenced by the Note and the other Loan Documents shall be solely
to the Property, Chattels and Intangible Personalty, and any other collateral
given as security for the Note.

 

9.5          Rights and Remedies
Cumulative.  Mortgagee’s rights and
remedies under each of the Loan Documents are cumulative of the rights and
remedies available to Mortgagee under each of the other Loan Documents and
those otherwise available to Mortgagee at law or in equity.  No act of Mortgagee shall be construed as an
election to proceed under any particular provision of any Loan Document to the
exclusion of any other provision in the same or any other Loan Document, or as
an election of remedies to the exclusion of any other remedy which may then or
thereafter be available to Mortgagee.

 

9.6          No Implied Waivers.  Mortgagee shall not be deemed to have waived
any provision of any Loan Document unless such waiver is in writing and is
signed by Mortgagee.  Without limiting
the generality of the preceding sentence, neither Mortgagee’s acceptance of any
payment with knowledge of a Default by Mortgagor, nor any failure by Mortgagee
to exercise any remedy following a Default by Mortgagor shall be deemed a
waiver of such Default, and no waiver by Mortgagee of any particular Default on
the part of Mortgagor shall be deemed a waiver of any other Default or of any
similar Default in the future.

 

9.7          No Third-Party Rights.  No person shall be a third-party beneficiary
of any provision of any of the Loan Documents. 
All provisions of the Loan Documents favoring Mortgagee are intended
solely for the benefit of Mortgagee, and no third party shall be entitled to
assume or expect that Mortgagee will not waive or consent to modification of any
such provision in Mortgagee’s sole discretion.

 

9.8          Preservation of
Liability and Priority.  Without
affecting the liability of Mortgagor or of any other person (except a person
expressly released in writing) for payment and performance of all of the Secured
Obligations, and without affecting the rights of Mortgagee with respect to any
security not expressly released in writing, and without impairing in any way
the priority of this Mortgage over the interests of any person acquired or
first evidenced by recording subsequent to the recording hereof, Mortgagee may,
either before or after the maturity of the Note, and without notice or
consent:  (a) release any person
liable for payment or

 

 

performance
of all or any part of the Secured Obligations; (b) make any agreement
altering the terms of payment or performance of all or any of the Secured
Obligations; (c) exercise or refrain from exercising, or waive, any right
or remedy which Mortgagee may have under any of the Loan Documents;
(d) accept additional security of any kind for any of the Secured
Obligations; or (e) release or otherwise deal with any real or personal
property securing the Secured Obligations. 
Any person acquiring or recording evidence of any interest of any nature
in the Property, the Chattels, or the Intangible Personalty shall be deemed, by
acquiring such interest or recording any evidence thereof, to have agreed and
consented to any or all such actions by Mortgagee.

 

9.9          Subrogation of
Mortgagee.  Mortgagee shall be
subrogated to the lien of any previous encumbrance discharged with funds
advanced by Mortgagee under the Loan Documents, regardless of whether such
previous encumbrance has been released of record.

 

9.10        Notices.  Any notice required or permitted to be given
by Mortgagor or Mortgagee under this Mortgage shall be in writing and will be
deemed given (a) upon personal delivery, (b) on the first business
day after receipted delivery to a courier service which guarantees
next-business-day delivery, or (c) on the third business day after
mailing, by registered or certified United States mail, postage prepaid, in any
case to the appropriate party at its address set forth below:

 

If to
Mortgagor:

 

Tradeport
Development II, LLC

204
West Newberry Road

Bloomfield,
Connecticut 06002-1308

Attention:
Anthony Galici

 

with a
copy to:

 

Murtha
Cullina, LLP

Cityplace
One, 185 Asylum Street

Hartford,
Connecticut 06103

Attention:
Thomas Daniells, Esq.

 

If to
Mortgagee:

 

First
SunAmerica Life Insurance Company

c/o
AIG Global Investment Corp.

1
SunAmerica Center, 38th Floor

Century
City

Los
Angeles, California 90067-6022

Attention:  Director-Mortgage Lending and Real Estate

 

 

with a
copy to:

 

Otten,
Johnson, Robinson, Neff & Ragonetti, P.C.

950
Seventeenth Street, Suite 1600

Denver,
Colorado 80202

Attention:  Aaron J. Hill, Esq.

 

Either party may change such party’s address for
notices or copies of notices by giving notice to the other party in accordance
with this Section.

 

9.11        Defeasance.  Upon payment and performance in full of all
of the Secured Obligations, Mortgagee will execute and deliver to Mortgagor
such documents as may be required to release this Mortgage of record.

 

9.12        Illegality.  If any provision of this Mortgage is held to
be illegal, invalid, or unenforceable under present or future laws effective
during the term of this Mortgage, the legality, validity, and enforceability of
the remaining provisions of this Mortgage shall not be affected thereby, and in
lieu of each such illegal, invalid or unenforceable provision there shall be added
automatically as a part of this Mortgage a provision as similar in terms to
such illegal, invalid, or unenforceable provision as may be possible and be
legal, valid, and enforceable.  If the
rights and liens created by this Mortgage shall be invalid or unenforceable as
to any part of the Secured Obligations, then the unsecured portion of the
Secured Obligations shall be completely paid prior to the payment of the
remaining and secured portion of the Secured Obligations, and all payments made
on the Secured Obligations shall be considered to have been paid on and applied
first to the complete payment of the unsecured portion of the Secured
Obligations.

 

9.13        Usury Savings Clause.  It is expressly stipulated and agreed to be
the intent of Mortgagee and Mortgagor at all times to comply with the
applicable law governing the highest lawful interest rate.  If the applicable law is ever judicially
interpreted so as to render usurious any amount called for under the Note or
under any of the other Loan Documents, or contracted for, charged, taken,
reserved or received with respect to the Loan, or if acceleration of the
maturity of the Note, any prepayment by Mortgagor, or any other circumstance
whatsoever, results in Mortgagor having paid any interest in excess of that
permitted by applicable law, then it is the express intent of Mortgagor and
Mortgagee that all excess amounts theretofore collected by Mortgagee be
credited on the principal balance of the Note (or, at Mortgagee’s option, paid
over to Mortgagor), and the provisions of the Note and other Loan Documents
immediately be deemed reformed and the amounts thereafter collectible hereunder
and thereunder reduced, without the necessity of the execution of any new
document, so as to comply with the applicable law, but so as to permit the
recovery of the fullest amount otherwise called for hereunder and
thereunder.  The right to accelerate
maturity of the Note does not include the right to accelerate any interest
which has not otherwise accrued on the date of such acceleration, and Mortgagee
does not intend to collect any unearned interest in the event of
acceleration.  All sums paid or agreed to
be paid to Mortgagee for the use, forbearance or detention of the Secured
Obligations

 

 

evidenced
hereby or by the Note shall, to the extent permitted by applicable law, be
amortized, prorated, allocated and spread throughout the full term of such
Secured Obligations until payment in full so that the rate or amount of
interest on account of such Secured Obligations does not exceed the maximum
rate or amount of interest permitted under applicable law.  The term “applicable law” as used herein
shall mean any federal or state law applicable to the Loan.

 

9.14        Obligations Binding Upon
Mortgagor’s Successors.  This
Mortgage is binding upon Mortgagor and Mortgagor’s successors and assigns, and
shall inure to the benefit of Mortgagee, and its successors and assigns, and
the provisions hereof shall likewise be covenants running with the land.  The duties, covenants, conditions, obligations,
and warranties of Mortgagor in this Mortgage shall be joint and several
obligations of Mortgagor and Mortgagor’s successors and assigns.

 

9.15        Construction.  All pronouns and any variations of pronouns
herein shall be deemed to refer to the masculine, feminine, or neuter, singular
or plural, as the identity of the parties may require.  Whenever the terms herein are singular, the
same shall be deemed to mean the plural, as the identity of the parties or the
context requires.

 

9.16        Attorneys’ Fees.  Any reference in this Mortgage to attorneys’
or counsel’s fees paid or incurred by Mortgagee shall be deemed to include
paralegals’ fees and legal assistants’ fees. 
Moreover, wherever provision is made herein for payment of attorneys’ or
counsel’s fees or expenses incurred by Mortgagee, such provision shall include
but not be limited to, such fees or expenses incurred in any and all judicial,
bankruptcy, reorganization, administrative, or other proceedings, including
appellate proceedings, whether such fees or expenses arise before proceedings
are commenced, during such proceedings or after entry of a final judgment.

 

9.17        Waiver and Agreement.  MORTGAGOR HEREBY EXPRESSLY WAIVES ANY RIGHT
IT MAY HAVE UNDER APPLICABLE LAW TO PREPAY THE NOTE, IN WHOLE OR IN PART,
WITHOUT PREPAYMENT CHARGE, UPON ACCELERATION OF THE MATURITY DATE OF THE NOTE,
AND AGREES THAT, IF FOR ANY REASON A PREPAYMENT OF ALL OR ANY PART OF THE NOTE
IS MADE, WHETHER VOLUNTARILY OR FOLLOWING ANY ACCELERATION OF THE MATURITY DATE
OF THE NOTE BY MORTGAGEE ON ACCOUNT OF THE OCCURRENCE OF ANY EVENT OF DEFAULT
ARISING FOR ANY REASON, INCLUDING, WITHOUT LIMITATION, AS A RESULT OF ANY
PROHIBITED OR RESTRICTED TRANSFER, FURTHER ENCUMBRANCE OR DISPOSITION OF THE
PROPERTY OR ANY PART THEREOF SECURING THE NOTE, THEN MORTGAGOR SHALL BE
OBLIGATED TO PAY, CONCURRENTLY WITH SUCH PREPAYMENT, THE PREPAYMENT PREMIUM
PROVIDED FOR IN THE NOTE (OR, IN THE EVENT OF ACCELERATION WHEN THE NOTE IS
CLOSED TO PREPAYMENT, AS PROVIDED IN THE DEFINITION OF “SECURED OBLIGATIONS”
SET FORTH IN ARTICLE 1 HEREOF).  MORTGAGOR HEREBY DECLARES THAT MORTGAGEE’S
AGREEMENT TO MAKE THE LOAN AT THE INTEREST RATE AND FOR THE TERM SET FORTH IN
THE NOTE CONSTITUTES ADEQUATE CONSIDERATION, GIVEN INDIVIDUAL WEIGHT BY
MORTGAGOR, FOR THIS WAIVER AND AGREEMENT.

 

 

9.18        Waiver of Jury Trial.  MORTGAGEE AND MORTGAGOR KNOWINGLY,
IRREVOCABLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHT EITHER MAY HAVE TO A
TRIAL BY JURY IN RESPECT OF ANY ACTION, PROCEEDING OR COUNTERCLAIM BASED ON
THIS MORTGAGE, OR ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS MORTGAGE OR
ANY LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENT
(WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY HERETO OR TO ANY LOAN
DOCUMENT.  THIS PROVISION IS A MATERIAL
INDUCEMENT FOR MORTGAGEE AND MORTGAGOR TO ENTER INTO THE LOAN.

 

9.19        Governing Laws.  The substantive laws of the State shall
govern the validity, construction, enforcement and interpretation of this
Mortgage.

 

9.20        Inconsistency.  In the event of any inconsistency between the
terms of the Loan Documents and the terms of that certain First Mortgage Loan
Application between Mortgagor and Mortgagee, as amended (the “Application”),
the terms of the Loan Documents shall govern and control in all respects.

 

9.21        Prejudgment Remedy.  MORTGAGOR AND EACH ENDORSER, GUARANTOR AND
SURETY OF THE NOTE, AND EACH OTHER PERSON LIABLE OR WHO SHALL BECOME LIABLE FOR
ALL OR ANY PART OF THE INDEBTEDNESS EVIDENCED BY THE NOTE, HEREBY ACKNOWLEDGE
THAT THE TRANSACTION OF WHICH THE NOTE AND THIS MORTGAGE IS A PART IS A
COMMERCIAL TRANSACTION, AND TO THE EXTENT ALLOWED UNDER CONNECTICUT GENERAL
STATUTES SECTIONS 52–278a TO 52–278n, INCLUSIVE, OR BY OTHER APPLICABLE
LAW, HEREBY WAIVE THEIR RIGHT TO NOTICE AND HEARING WITH RESPECT TO ANY PREJUDGMENT
REMEDY WHICH MORTGAGEE OR ITS SUCCESSORS OR ASSIGNS MAY DESIRE TO USE.

 

9.22        Anti-Terrorism.

 

(a)           None of Mortgagor,
Guarantor or any of their respective constituents or affiliates is in violation
of any laws relating to terrorism or money laundering, including without
limitation, Executive Order No. 13224 on Terrorist Financing, effective September 24,
2001, and relating to Blocking Property and Prohibiting Transactions With
Persons Who Commit, Threaten to Commit, or Support Terrorism, (as the same has
been, or may hereafter be, renewed, extended, amended or replaced, the “Executive
Order”) and the Bank Secrecy Act (31 U.S.C. § 5311 et seq.),
as amended by the Uniting and Strengthening America by Providing Appropriate
Tools Required to Intercept and Obstruct Terrorism Act of 2001 (Public Law 107-56,
as the same has been, or may hereafter be, renewed, extended, amended or
replaced, the “Patriot Act”).  As used
herein, “Anti-Terrorism Laws” shall mean any laws relating to terrorism or
money laundering, including the Executive Order, the Patriot Act, the laws
comprising or implementing the Bank Secrecy Act, and the laws administered by
the United States Treasury Department’s Office of Foreign Asset Control (as any
of the foregoing laws may from time to time be renewed, extended, amended, or
replaced).

 

 

(b)           None of Mortgagor,
Guarantor, their respective affiliates, or to Mortgagor’s knowledge, any person
having a beneficial interest in Mortgagor or Guarantor, any person for whom
Mortgagor or Guarantor is acting as agent or nominee, any of their respective
brokers or other agents acting in any capacity in connection with the Loan or,
to Mortgagor’s knowledge as of the date hereof, Mortgagor’s predecessor in
interest to the Property is a “Prohibited Person,” which is defined as follows:

 

(i)      a person or entity that is
listed in the Annex to, or is otherwise subject to the provisions of, the
Executive Order;

 

(ii)     a person or entity owned or
controlled by, or acting for or on behalf of, any person or entity that is
listed in the Annex to, or is otherwise subject to the provisions of, the
Executive Order;

 

(iii)    a person or entity with whom
Mortgagee or any bank or other institutional lender is prohibited from dealing
or otherwise engaging in any Anti-Terrorism Law;

 

(iv)    a person or entity who
commits, threatens or conspires to commit or supports “terrorism” as defined in
the Executive Order;

 

(v)     a person or entity that is
named as a “specially designated national” or “blocked person” on the most
current list published by the U.S. Treasury Department Office of Foreign Assets
Control at its official Website, http://www.treas.gov/ofac/t11sdn.pdf or at any
replacement Website or other replacement official publication of such list; and

 

(vi)    a person or entity who is
affiliated with a person or entity listed above.

 

(c)           None of Mortgagor,
Guarantor, any of their respective affiliates, to Mortgagor’s knowledge, any of
their respective brokers or other agents acting in any capacity in connection
with the Loan or, to Mortgagor’s knowledge as of the date hereof, the seller of
the Property (if any portion of the Property is being acquired with proceeds of
the Loan), does or shall (i) conduct any business or engage in any
transaction or dealing with any Prohibited Person, including making or
receiving any contribution of funds, goods or services to or for the benefit of
any Prohibited Person or leasing any portion of the Property to any Prohibited
Person, (ii) deal in, or otherwise engage in any transaction relating to,
any property or interests in property blocked pursuant to the Executive Order,
or (iii) engage in or conspire to engage in any transaction that evades or
avoids, or has the purpose of evading or avoiding, or attempts to violate, any
of the prohibitions set forth in any Anti-Terrorism Law.

 

(d)           Mortgagor shall
promptly deliver to Mortgagee any certification or other evidence reasonably
requested from time to time by Mortgagee confirming Mortgagor’s compliance with
this Section.  The representations,
warranties and covenants set forth in this Section shall be deemed
repeated and reaffirmed by Mortgagor as of each date that Mortgagor makes a
payment to Mortgagee under the Note, this Mortgage and the other Loan Documents
or receives any payment from Mortgagee. 
Mortgagor shall promptly notify Mortgagee in writing

 

 

should
Mortgagor become aware of any change in the information set forth in these
representations, warranties and covenants.

 

NOW THEREFORE, if Mortgagor shall pay or cause to be
paid the Secured Obligations and if Mortgagor shall keep, perform and observe
all of the covenants, agreements, conditions and provisions of this Mortgage
and the other Loan Documents, then this Mortgage shall be null and void and of
no further force and effect and shall be released by Mortgagee after written
request by, and at the expense of, Mortgagor; otherwise to remain in full force
and effect.

 

[Balance of Page Intentionally Left Blank]

 

IN WITNESS WHEREOF, Mortgagor has executed and
delivered this Mortgage as of the date first mentioned above.

 

	
   

  	
  TRADEPORT
  DEVELOPMENT II, LLC, a

  Connecticut limited liability company

  
	
   

  	
   

  
	
   

  	
  By: River Bend
  Associates, Inc., a Connecticut

  corporation, its Sole Member

  
	
   

  	
   

  
	
  Witness:

  	
  /s/ Thomas Daniells

  	
   

  	
  By:

  	
  /s/ Anthony Galici

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
  Anthony Galici

  	
   

  
	
   

  	
   

  	
   

  
	
  Witness:

  	
  /s/ Sara Taylor

  	
   

  	
  Title:

  	
  Vice President

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