Exhibit 10.5
To Be Recorded In The Land
Records of Tarrant County, Texas,
AFTER RECORDATION PLEASE RETURN TO:
David S. Berman, Esq.
Riemer & Braunstein LLP
Three Center Plaza
Boston, MA 02108
NOTICE OF CONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL PERSON, YOU MAY
REMOVE OR STRIKE ANY OF THE FOLLOWING FROM THIS INSTRUMENT BEFORE IT IS FILED
FOR RECORD IN THE PUBLIC RECORDS: YOUR SOCIAL SECURITY NUMBER OR YOUR DRIVERS
LICENSE NUMBER.
DEED OF TRUST
AND
ABSOLUTE ASSIGNMENT OF LEASES AND RENTS
THIS DEED OF TRUST AND ABSOLUTE ASSIGNMENT OF LEASES AND RENTS (hereinafter
referred to as this "Deed of Trust") is made and entered into as of this 11th
day of October, 2005, by GAMESTOP TEXAS LP, a limited partnership organized
under the laws of the State of Texas, as grantor or mortgagor (hereinafter
referred to as "Grantor"), Grantor having its principal place of business at 625
Westport Parkway, Grapevine, Texas 76051, in favor of Stephen Garvin, an
individual and officer of the Collateral Agent, as Trustee ("Trustee") for the
use and benefit of BANK OF AMERICA, N.A., as grantee or beneficiary, as
collateral agent, (in such capacity, the "Collateral Agent") for the ratable
benefit of the Secured Parties (hereinafter in such capacity referred to as
"Beneficiary"), Beneficiary having an office at 40 Broad Street, 10th Floor,
Boston, Massachusetts 02109.
Each capitalized term used herein but not defined herein shall have the
meaning assigned to such term in the Credit Agreement (as defined herein).
W I T N E S S E T H:
A. Reference is made to that certain Credit Agreement dated as of even date
herewith (as the same may be amended, modified, supplemented or restated
hereafter, the "Credit Agreement"), by, among others, (i) the Grantor and
certain Affiliates of the Grantor (singly, a "Borrower", and collectively, the
"Borrowers"), (ii) the Lenders named therein, (iii) Bank of America, N.A., as
Administrative Agent and Collateral Agent for the Lenders, (iv) Citicorp North
America, Inc., as Syndication Agent, (v) Merrill Lynch Capital, a division of
Merrill Lynch Business Financial Services Inc., as Documentation Agent, (vi)
Bank of America, N.A. and Citicorp North America, Inc., as Issuing Banks, and
(vii) Banc of America Securities LLC, Citigroup Global Markets Inc. and Merrill
Lynch Capital, a Division of Merrill Lynch Business Financial Services Inc., as
Joint Lead Arrangers and Joint Lead Bookrunners.
B. Pursuant to the Credit Agreement, each of the Lenders have agreed to
lend to the Borrowers, on a revolving basis, Revolving Loans, at any time and
from time to time prior to the Termination Date, the Swingline Lender has agreed
to lend, on a revolving basis, Swingline Loans, at any time and from time to
time prior to the Termination Date, and the Issuing Banks have issued and have
agreed to issue Letters of Credit for the benefit of the Borrowers at any time
and from time to time prior to the Termination Date, in each case upon the terms
and subject to the conditions specified in, the Credit Agreement.
C. The obligations of the Lenders to make Loans and of the Issuing Banks to
issue Letters of Credit are conditioned upon, among other things, the execution
and delivery by the Grantor of this Deed of Trust, to secure the due and
punctual payment and performance of the following described indebtedness and
obligations: (a) all Obligations; and (b) any and all additional advances made
by any Secured Party, to the extent made consistent with the terms hereof, to
protect or preserve the Mortgaged Property or the security interest created
hereby on the Mortgaged Property, or for taxes, assessments or insurance
premiums as hereinafter provided or for performance of any of Grantor's
obligations hereunder or under the other Loan Documents or for any other purpose
provided herein or in the other Loan Documents (whether or not the original
Grantor remains the owner of the Mortgaged Property at the time of such
advances) (hereinafter (a) and (b) shall collectively be referred to as the
"Secured Obligations").
D. Pursuant to the requirements of the Credit Agreement, the Grantor is
granting this Deed of Trust in favor of the Beneficiary, for the ratable benefit
of the Secured Parties to create a security interest in the Mortgaged Property
(as defined herein) to secure the performance and payment by the Grantor of the
Secured Obligations. The Credit Agreement also requires the granting by the
Grantor and/or other Borrowers of other mortgages (the "Other Deeds of Trust")
that create security interests in certain mortgaged properties other than the
Property to secure the performance of the Secured Obligations.
GRANTING CLAUSE:
NOW THEREFORE, IN CONSIDERATION OF TEN AND NO/100 DOLLARS ($10.00) AND
OTHER GOOD AND VALUABLE CONSIDERATION, the receipt and sufficiency whereof are
hereby acknowledged by Grantor, and in order to secure the Secured Obligations,
Grantor does hereby grant, bargain, sell, transfer, assign, mortgage, warrant
and convey unto the Trustee, his heirs, successors and assigns for the benefit
of the Beneficiary for the ratable benefit of the Secured Parties, and their
respective successors and assigns, all of the following described property
(hereinafter those items of property described in subparagraphs (a) and (b),
below, collectively referred to as the "Property", and together with the
property described in subparagraphs (c), (d) and (e), collectively, the
"Mortgaged Property"):
(a) All those certain tracts or parcels of land described in Exhibit A
attached hereto and by this reference made a part hereof, together with all
right, title and interest of Grantor, including any after-acquired title or
reversion, in and to the rights-of-ways, streets, and alleys adjacent thereto,
and all easements, rights-of-way, licenses, operating agreements, strips and
gores of land, vaults, streets, ways, alleys, passages, sewers, sewer rights,
waters, water courses, water rights and powers, oil, gas and other minerals,
flowers, shrubs, crops, trees, timber and other emblements now or hereafter
located on such land or under or above same,
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and all estates, rights, titles, interests, privileges, liberties, tenements,
hereditaments and appurtenances whatsoever, in any way belonging, relating to or
appertaining to said tracts or parcels of land or any part thereof, or which
hereafter shall in any way belong, relate or be appurtenant thereto, whether now
owned or hereafter acquired by Grantor and the reversion and reversions,
remainder and remainders, and all the estate, right, title, interest, property,
possession, claim and demand whatsoever at law, as well as in equity, of the
Grantor of, in and to the same (hereinafter referred to as the "Land"); and
(b) All buildings, structures, parking areas, landscaping, fixtures, and
other improvements of every nature now or hereafter situated, erected or placed
on the Land (hereinafter referred to as the "Improvements"); and
(c) All present and future leases, tenancies, occupancies and licenses,
whether written or oral ("Property Leases") of the Land, and the Improvements,
or any combination or part thereof, and all income, rents, issues, royalties,
profits, revenues, security deposits and other benefits of the Land, and the
Improvements, from time to time accruing, all payments under Property Leases,
and all payments on account of oil and gas and other mineral Property Leases,
working interests, production payments, royalties, overriding royalties, rents,
delay rents, operating interests, participating interests and other such
entitlements, and all the estate, right, title, interest, property, possession,
claim and demand whatsoever at law, as well as in equity, of Grantor of, in and
to the same (hereinafter referred to as the "Revenues"); and
(d) To the extent assignable, all the right, title and interest of Grantor
in and to all construction contracts, subcontracts, architectural agreements,
labor, material and payment bonds, guaranties and warranties, and plans and
specifications relating to the construction of Improvements on the Land, whether
now or hereafter existing, including, without limitation (i) any architectural
or engineering agreement entered into with respect to the design of said
Improvements and other architectural or engineering services, (ii) the plans and
specifications for the construction of said Improvements prepared by the
architect, and (iii) any contractor's agreement entered into with respect to
construction of Improvements on the Land (hereinafter collectively referred to
as the "Contracts"); and
(e) All insurance proceeds and all other proceeds (including all Proceeds
as defined in the UCC), products, substitutions and accessions of the foregoing
of every type.
TO HAVE AND TO HOLD the Property and all parts, rights, members and
appurtenances thereof, to the use and benefit of Trustee, his heirs, successors
and assigns for the benefit of the Beneficiary for the ratable benefit of the
Secured Parties, and their respective successors and assigns, in fee simple
forever; and Grantor covenants that Grantor is lawfully seized and possessed of
the Property and holds indefeasible fee simple absolute title to the Land, and
has good right to convey the Property and that the
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conveyances in this Deed of Trust are subject to only to Permitted Encumbrances.
Except for the Permitted Encumbrances, Grantor does warrant and will forever
defend the title to the Mortgaged Property against the claims of all persons
whomsoever.
This Deed of Trust is intended to constitute: (i) a security agreement,
fixture filing and financing statement under the Uniform Commercial Code in
effect from time to time in the State of Texas (the "UCC"), (ii) a deed of trust
under the Texas Property Code, as amended, and (iii) a notice of assignment of
rents or profits under the Texas Property Code, as amended. This Deed of Trust
is also intended to operate and be construed as an absolute present assignment
of the rents, issues and profits of the Property, Grantor hereby agreeing, as
provided for under law of the State of Texas, that Beneficiary is entitled to
receive the rents, issues and profits of the Property prior to an Event of
Default and without entering upon or taking possession of the Property. Some of
the items included within the Property are or are to be come "fixtures" (as that
term is defined in the UCC) on the Land and, as provided under the UCC, this
Deed of Trust, upon being filed for record in the real property records of
Tarrant County, Texas, shall operate also as a "fixture filing" and financing
statement upon such of the items which are or may become fixtures.
This Deed of Trust is given to secure the payment and performance of the
Secured Obligations, to the extent provided for herein.
Grantor hereby further covenants and agrees with Trustee and Beneficiary as
follows:
1. Payment and Performance of Secured Obligations.
Grantor shall promptly pay the Secured Obligations when due, and fully and
promptly perform all of the provisions, agreements, covenants and obligations of
the Grantor, subject to all applicable grace and cure periods.
2. Impositions, Liens and Charges.
Grantor shall pay all the yearly water and sewer bills, real estate taxes,
ad valorem taxes, personal property taxes, assessments, betterments, common area
maintenance charges, all governmental charges of every name and restriction
which may be levied on the Property as well as the yearly premium installments
for the insurance covering the Property as required pursuant to Paragraph 2
hereof (hereinafter collectively referred to as the "Impositions") and other
charges, if any, attributable to the Property, subject to the Grantor's right to
contest, provided such contest complies with terms of Section 5.5 of the Credit
Agreement. Grantor shall furnish to the Collateral Agent all bills and notices
of amounts due under this Paragraph 2 as soon as received, and, Grantor shall
furnish to the Collateral Agent evidence of such payments at least five (5) days
prior to the dates on which such payments are delinquent for taxes. Grantor
shall promptly discharge (by bonding, payment or otherwise) any Lien filed
against the Property (other than Permitted Encumbrances).
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3. Property and Other Insurance. (a) The Grantor shall (i) maintain or
shall cause to be maintained insurance with financially sound and reputable
insurers reasonably acceptable to the Collateral Agent on the Property and in at
least such amounts and against at least such risks as is customary with
companies in the same or similar businesses operating in the same or similar
locations, including public liability insurance against claims for personal
injury or death occurring upon, in or about or in connection with the use of any
properties owned, occupied or controlled by it; (ii) maintain such other
insurance as may be required by law; and (iii) furnish to the Collateral Agent,
upon written request, full information as to the insurance carried.
(b) Fire and extended coverage policies maintained with respect to any
Property shall be endorsed or otherwise amended to include (i) a
non-contributing Collateral Agent clause (regarding the Improvements), in form
and substance reasonably satisfactory to the Collateral Agent, which
endorsements or amendments shall provide that the insurer shall pay all proceeds
otherwise payable to the Grantor under the policies directly to the Collateral
Agent, (ii) a provision to the effect that none of the Grantor, Secured Parties
nor any other Person shall be a co-insurer, and (iii) such other provisions as
the Collateral Agent may reasonably require from time to time to protect the
interests of the Secured Parties. Commercial general liability policies shall be
endorsed to name the Collateral Agent as an additional insured. Business
interruption policies shall name the Collateral Agent as loss payee and shall be
endorsed or amended to include (i) a provision that, from and after the Closing
Date, the insurer shall pay all proceeds the insurer shall pay all proceeds in
excess of $5,000,000 otherwise payable to the Grantor under the policies
directly to the Collateral Agent, provided, however, that the Collateral Agent
hereby agrees that prior to the occurrence of an Event of Default or a Cash
Dominion Event, the Collateral Agent shall remit all proceeds received by
Collateral Agent under the policies to Grantor, provided further that after the
occurrence of an Event of Default or a Cash Dominion Event, the Collateral Agent
shall apply any proceeds received in accordance with Section 2.22 of the Credit
Agreement or Section 6.2 of the Security Agreement, as applicable, (ii) a
provision to the effect that none of the Grantor, the Secured Parties or any
other Person shall be a co-insurer and (iii) such other provisions as the
Collateral Agent may reasonably require from time to time to protect the
interests of the Lenders. Each such policy referred to in this paragraph also
shall provide (i) that it shall not be canceled or modified except upon not less
than 30 days' prior written notice thereof by the insurer to the Collateral
Agent (giving the Collateral Agent the right to cure defaults in the payment of
premiums) and (ii) that it shall not be not renewed except upon not less than 15
days' prior written notice thereof by the insurer to the Collateral Agent
(giving the Collateral Agent the right to cure defaults in the payment of
premiums). The Grantor shall deliver to the Collateral Agent, prior to the
cancellation, modification or nonrenewal of any such policy of insurance, a copy
of a renewal or replacement policy (or other evidence of renewal of a policy
previously delivered to the Collateral Agent) together with evidence
satisfactory to the Collateral Agent of payment of the premium therefor.
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(c) In the event that the Grantor at any time or times shall fail to obtain
or maintain any of the policies of insurance required hereby or to pay any
premium in whole or part relating thereto, the Collateral Agent may, without
waiving or releasing any obligation or liability of the Grantor hereunder or any
Default or Event of Default, in its sole discretion, obtain and maintain such
policies of insurance and pay such premium and take any other actions with
respect to as the Collateral Agent deems advisable. All sums disbursed by the
Collateral in connection with this Paragraph 3(c), including reasonable
attorneys' fees, court costs, expenses and other charges relating thereto, shall
be payable, upon demand, by the Grantor to the Collateral Agent and shall be
additional Secured Obligations secured hereby.
(d) In the event of any loss or damage to the Property, the Grantor shall
give immediate written notice to the insurance carrier and to the Collateral
Agent. Grantor hereby irrevocably makes, constitutes and appoints the Collateral
Agent (and all officers, employees or agents designated by the Collateral Agent)
as Grantor's true and lawful agent and attorney-in-fact, whether or not an Event
of Default has occurred, to make proof of such loss, to adjust and compromise
any claim under insurance policies, and to appear in and prosecute any action
arising from such insurance policies. Whether or not an Event of Default has
occurred, the Collateral Agent is authorized to collect and receive insurance
proceeds, and to deduct therefrom Collateral Agent's expenses incurred in the
collection of such proceeds. Grantor further authorizes the Collateral Agent, at
Collateral Agent's option, whether or not an Event of Default has occurred, to
apply the balance of such proceeds to the payment of the Secured Obligations in
accordance with the terms of the Credit Agreement.
(e) TEXAS FINANCE CODE Section 307.052 COLLATERAL PROTECTION INSURANCE
NOTICE: (A) GRANTOR IS REQUIRED TO: (i) KEEP THE MORTGAGED PROPERTY INSURED
AGAINST DAMAGE IN THE AMOUNT EQUAL TO THE GRANTOR'S INDEBTEDNESS TO COLLATERAL
AGENT AND THE SECURED PARTIES; (ii) PURCHASE THE INSURANCE FROM AN INSURER THAT
IS AUTHORIZED TO OD BUSINESS IN THE STATE OF TEXAS OR AN ELIGIBLE SURPLUS LINES
INSURER; AND (iii) NAME THE BENEFICIARY AS THE PERSON TO BE PAID UNDER THE
POLICY IN THE EVENT OF LOSS; (B) GRANTOR MUST, IF REQUIRED BY BENEFICIARY,
DELIVER TO BENEFICIARY A COPY OF THE POLICY AND PROOF OF THE PAYMENT OF
PREMIUMS; AND (C) IF GRANTOR FAILS TO MEET ANY REQUIREMENT LISTED IN CLAUSE (A)
OR (B) ABOVE, THE BENEFICIARY MAY OBTAIN COLLATERAL PROTECTION INSURANCE ON
BEHALF OF THE GRANTOR AT THE GRANTOR'S EXPENSE.
4. Preservation and Maintenance. Grantor (a) shall not permit or commit waste,
impairment, or deterioration of the Property or abandon the Property, (b) shall
restore or repair promptly and in a good and workmanlike manner all or
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any part of the Property in the event of any damage, injury or loss thereto, to
the equivalent of its condition prior to such damage, injury or loss, or such
other condition as the Collateral Agent may approve in writing, (c) shall keep
the Property, including the Improvements, in good order, repair and tenantable
condition and shall replace fixtures, equipment, machinery and appliances on the
Property when necessary to keep such items in good order, repair, and tenantable
condition, and (d) shall comply with all laws, ordinances, regulations and
requirements of any governmental body, as well as any reciprocal easement
agreements or covenants of record, applicable to the Property, subject to the
Grantor's right to contest, provided such contest complies with terms of Section
5.5 of the Credit Agreement. Grantor covenants and agrees to give the Collateral
Agent prompt notice of any non-compliance with such laws, ordinances,
regulations or requirements and of any notice of non-compliance therewith which
it receives or any threatened or pending proceedings in respect thereto or with
respect to the Property. Neither Grantor nor any tenant or other person shall
remove, demolish or alter any Improvements now existing or hereafter erected on
the Property, without the prior consent of the Collateral Agent, not to be
unreasonably withheld, except to the extent the same would impair the structural
integrity or value of the Property.
5. Transfers. Except as otherwise provided in the Credit Agreement, Grantor will
not, directly or indirectly, without the prior written consent of the Collateral
Agent in each instance: (a) sell, convey, assign, transfer, option, mortgage,
pledge, hypothecate or dispose of the Mortgaged Property, or any part thereof or
interest therein; or (b) create or suffer to be created or to exist any Lien,
restriction, or attachment of any kind upon the Mortgaged Property, or any part
thereof or interest therein other than the Permitted Encumbrances.
6. Hazardous Materials Warranties and Indemnification.
(i) Environmental Representations and Warranties of Grantor. In addition to
the representations and warranties made in Credit Agreement, Grantor represents
and warrants to each Secured Party as follows:
(i) There are no existing or closed underground storage tanks ("USTs") on
the Property (i) from which Hazardous Materials have been released or leaked to
the environment, or (ii) that are not in compliance with all federal, state, and
local laws and regulations covering the installation, operation, maintenance and
abandonment of USTs.
(ii) None of the following will hereafter be brought on or constitute a
part of the Property: friable asbestos or friable asbestos-containing material;
urea formaldehyde insulation; transformers or other equipment which contain
dielectric fluid containing polychlorinated biphenyls; or leaded paint, except
as may be brought on the Property in accordance with law or for use or sale in
connection with the current use of the Property.
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(iii) There are no existing or closed sanitary landfills, solid waste
disposal sites, or hazardous waste treatment, storage or disposal facilities on
the Property except as have been disclosed to relevant Governmental Authorities
and as have been regulated, operated, monitored, assessed and (as necessary)
remediated in accordance with law.
(iv) To the best of Grantor's knowledge, no pending or current notice has
been issued to Grantor by any agency, authority, or unit of government that
Grantor has been identified as a potentially responsible party under any
Environmental Law.
(v) To the best of Grantor's knowledge, there exists no pending or current
investigation, action, proceeding, or claim by any Governmental Authority or by
any third party which could result in any liability, penalty, sanction, or
judgment under any Environmental Law with respect to any condition, use or
operation of the Property.
(ii) Environmental Covenants of Grantor. In addition to the Grantor's
covenants in the Credit Agreement, the Grantor covenants and agrees with each
Secured Party that Grantor shall:
(i) remain in material compliance with all Environmental Laws;
(ii) not store (except in compliance with all Environmental Laws pertaining
thereto), dispose of, release or allow the release of any Hazardous Materials on
the Property;
(iii) neither directly nor indirectly transport or arrange for the
transport of any Hazardous Materials (except in compliance with all
Environmental Laws pertaining thereto); and
(iv) upon the request of the Collateral Agent, if the Collateral Agent has
reason to believe that Hazardous Materials are stored, released or disposed of
on the Property, take all reasonable action (including, without limitation, the
conducting of reasonably scoped environmental assessments at the sole expense of
the Grantor in accordance with subparagraph (c) hereof) to confirm that no
Hazardous Materials are stored, released or disposed of on the Property.
(iii) Environmental Indemnity. Grantor covenants and agrees, at Grantor's
sole cost and expense, to indemnify, defend (at trial and appellate levels, and
with attorneys, consultants and experts reasonably acceptable to the Collateral
Agent) and hold each Indemnitee harmless from and against any and all Liens,
damages, losses, liabilities, obligations, settlement payments, penalties,
assessments, citations, directives, claims, litigation, demands, defenses,
judgments, suits, proceedings, costs, disbursements or expenses of any kind or
of any nature whatsoever with respect to any Environmental Liability in
accordance with Section 9.3(b) of the Credit Agreement, including, without
limitation (i) the costs of assessment, containment and/or removal of any and
all Hazardous
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Materials from all or any portion of the Property as required by law, (ii) the
costs of any actions taken as required by law in response to a release of any
Hazardous Materials on, in, under or affecting all or any portion of the
Property in order to prevent or minimize such release so that it does not
migrate to adjacent properties or cause or threaten significant risk to present
or future public health, safety, welfare or the environment. Indemnitees' rights
under this Paragraph shall be in addition to all other rights of Indemnitees
under this Deed of Trust and the other Loan Documents and payments by Grantor
under this paragraph shall not reduce Grantor's obligations and liabilities
under any of the Loan Documents.
(iv) Notice to Collateral Agent. If Grantor receives any notice or obtains
knowledge of (i) any potential or known release of any Hazardous Materials at or
from the Property, notification of which must be given to any Governmental
Authority under any Environmental Law, or notification of which has, in fact,
been given to any Governmental Authority, or (ii) any complaint, order, citation
or notice with regard to air emissions, water discharges, or any other
environmental health or safety matter affecting Grantor or the Property (an
"Environmental Complaint") from any Person (including, without limitation, the
Environmental Protection Agency), then Grantor shall immediately notify the
Collateral Agent orally and in writing of said release or Environmental
Complaint. Upon such notification, the Collateral Agent may, at its election
without regard to whether an Event of Default has occurred, obtain one or more
reasonably scoped environmental assessments of the Property prepared by a
geohydrologist, an independent engineer or other qualified consultant or expert
approved by the Collateral Agent which evaluates or confirms (i) whether any
Hazardous Materials are present in the soil or water at or adjacent to the
Property, and (ii) whether the use and operation of the Property comply
materially with all Environmental Laws. Environmental assessments may include
detailed visual inspections of the Property, including, without limitation, any
and all storage areas, storage tanks, drains, dry wells and leaching areas, and
the taking of soil samples, surface water samples and ground water samples, as
well as such other investigations or analyses as are reasonably necessary or
appropriate for a determination of the compliance of the Property and the use
and operation thereof with all applicable Environmental Laws. All such
environmental assessments shall be at the cost and expense of the Grantor. To
the extent necessary to allow the Collateral Agent to obtain the environmental
assessments provided for herein, the Grantor agrees that the Collateral Agent
and the representatives and agents of the Collateral Agent shall have a right to
enter upon, visit and inspect the Property, provided that in no event shall the
Collateral Agent's exercise of this right unreasonably interfere with Grantor's
use and enjoyment of the Property.
(v) Survival, Assignability, and Transferability.
(i) The warranties, representations and indemnity set forth in this
Paragraph 6 shall survive the payment and performance of the Secured Obligations
and any exercise by Beneficiary of any remedies under this Deed of Trust,
including without limitation, any remedy in the nature of foreclosure, and
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shall not merge with any deed given by Grantor to Beneficiary or any Secured
Party in lieu of foreclosure.
(ii) It is agreed and intended by Grantor and Beneficiary that the
warranties, representations and indemnity set forth above in this Paragraph 6
may be assigned or otherwise transferred by Beneficiary to its successors and
assigns and to any subsequent purchasers of all or any portion of the Property
by, through or under Beneficiary, without notice to Grantor and without any
further consent of Grantor. To the extent consent or any such assignment or
transfer is required by law, advance consent to any such assignment or transfer
is hereby given by Grantor in order to maximize the extent and effect of such
warranties, representations and indemnity given hereby.
7. Use of Property. Unless required by applicable law or unless the Collateral
Agent has otherwise consented thereto in writing, which consent shall not be
unreasonably withheld or delayed, (i) Grantor shall not allow changes in the
nature of the occupancy or use for which the Property was intended at the time
this Deed of Trust was executed, and (ii) Grantor shall not initiate a change in
the zoning classification of the Property or subject the Property to restrictive
or negative covenants. Grantor shall comply with, observe and perform all zoning
and other laws affecting the Property, all restrictive covenants affecting the
Property, and all licenses and permits affecting the Property, subject to the
Grantor's right to contest, provided such contest complies with terms of Section
5.5 of the Credit Agreement.
8. Protection of Beneficiary's Security. If Grantor fails to perform the
covenants and agreements contained in this Deed of Trust, or if any action or
proceeding is commenced which affects the Mortgaged Property or title thereto or
the interest of Beneficiary therein, including, but not limited to, eminent
domain, or code enforcement, then the Collateral Agent, at such Collateral
Agent's option, may make such appearances, disburse such sums and take such
action as the Collateral Agent deems necessary to protect Beneficiary's interest
herein, including, but not limited to, disbursement of attorneys' fees, payment,
contest or compromise of any Lien which is prior to the Lien of this Deed of
Trust, and entry upon the Property to make repairs. Any amounts disbursed by the
Collateral Agent pursuant to this Paragraph 8, with interest thereon, shall
become a portion of the Secured Obligations. Unless Grantor and such Beneficiary
agree to other terms of payment, such amounts shall be payable upon notice from
the Collateral Agent to Grantor requesting payment thereof and shall bear
interest from the date of disbursement at the default rate payable on Prime Rate
Loans (the "Default Rate") stated in the Credit Agreement unless collection from
Grantor of interest at such rate would be contrary to Applicable Law, in which
event such amounts shall bear interest at the highest rate which may be
collected from Grantor under Applicable Law. Grantor shall have the right to
prepay such amounts in whole or in part at any time. Nothing contained in this
Paragraph 8 shall require the Collateral Agent to incur any expense or do any
act.
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9. Condemnation. If the Property or any portion thereof (the loss of which shall
have, in the sole judgment of the Collateral Agent, a material impact on the
use, operation or value of the Property) shall be damaged or taken through
condemnation (which term, when used in this Mortgage, shall include any damage
or taking by any Governmental Authority, quasi-governmental authority, any
Person having the power of condemnation, or any transfer by private sale in lieu
thereof), either temporarily or permanently, then the Collateral Agent shall
have the right to commence, appear in and prosecute any action or proceeding
relating to any condemnation or other taking of the Property and to settle or
compromise any claim in connection with such condemnation or other taking.
Grantor hereby irrevocably makes, constitutes and appoints the Collateral Agent
(and all officers, employees or agents designated by the Collateral Agent) to
commence, appear in and prosecute, in the Collateral Agent's name or Grantor's
name, any action or proceeding relating to any condemnation or other taking of
the Property and to settle or compromise any claim in connection with such
condemnation or other taking. The proceeds of any award or claim for damages,
direct or consequential, in connection with any condemnation, or other taking of
the Property, or part thereof, or for conveyances in lieu of condemnation, are
hereby assigned to Collateral Agent. Grantor authorizes Collateral Agent to
apply such awards, proceeds or damages, after the deduction of the Collateral
Agent's expenses incurred in the collection of such amounts, in the manner
provided in the Credit Agreement. Grantor agrees to execute such further
assignment of any awards, proceeds, damages or claims arising in connection with
such condemnation or injury that the Collateral Agent may require.
10. Grantor and Lien Not Released. From time to time, without affecting the
obligation of Grantor or Grantor's successors or assigns to pay the Secured
Obligations and to observe the covenants of Grantor contained in this Deed of
Trust and the other Loan Documents, and without affecting the guaranty of any
Person, for payment or performance of the Secured Obligations, and without
affecting the Lien or priority of Lien of this Deed of Trust on the Mortgaged
Property, the Collateral Agent may, at the Collateral Agent's option, without
giving notice to or obtaining the consent of Grantor, Grantor's successors or
assigns or of any Facility Guarantor, and without liability on any Secured
Party's part, but subject to the terms and conditions of the Credit Agreement,
grant extensions or postponements of the time for payment of the Secured
Obligations or any part thereof, release anyone liable on any of the Secured
Obligations, accept a renewal note or notes therefor, release from this Deed of
Trust any part of the Mortgaged Property, take or release other or additional
security, reconvey any part of the Mortgaged Property, consent to any map or
plat or subdivision of the Property, consent to the granting of any easement,
join in any extension or subordination agreement and agree in writing with
Grantor to modify the terms and conditions of any Loan Document. Grantor shall
pay such title insurance premiums and attorneys' fees as may be incurred, at the
Collateral Agent's option, for any such action if taken at Grantor's request.
11
11. Forbearance Not Waiver. Any forbearance by the Collateral Agent or any other
Secured Party in exercising any right or remedy hereunder, or otherwise afforded
by Applicable Law, shall not be a waiver of or preclude the exercise of any
right or remedy hereunder. The procurement of insurance or the payment of taxes
or other Liens by the Collateral Agent shall not be a waiver of the Collateral
Agent's right to accelerate the maturity of the Secured Obligations. The
Collateral Agent's receipt of any awards, proceeds or damages under Paragraphs 3
and 9 hereof shall not operate to cure or waive Grantor's default in payment of
the Secured Obligations.
12. Property Leases and Revenues.
(a) As part of the consideration for the Secured Obligations, Grantor has
absolutely and unconditionally assigned and transferred to Beneficiary for the
ratable benefit of the Secured Parties all of Grantor's right, title and
interest in and to the Property Leases and the Revenues, including those now
due, past due or to become due by virtue of any Property Lease for the occupancy
or use of all or any part of the Property. Grantor hereby represents and
warrants as follows:
(i) Grantor is the sole and absolute owner of the entire landlord's or
lessor's interest in the Property Leases and said rents, issues and profits
and shall not assign its interest in, to or under any of the Property
Leases or the Revenues to any person or entity other than the Beneficiary;
(ii) Grantor has made no prior assignment of any of the Property
Leases or with respect to any of said rents, issues or profits; and
(iii) Grantor has neither done any act nor omitted to do any act which
might prevent Beneficiary from, or limit Beneficiary in, acting under any
of the provisions of this assignment pursuant to this Deed of Trust.
(b) Grantor agrees that neither the foregoing assignment of Property Leases
and Revenues, nor the exercise of any of Beneficiary's rights and remedies under
Paragraph 17 hereof shall be deemed to make Beneficiary a
mortgagee-in-possession or otherwise responsible or liable in any manner with
respect to the Property Leases, the Property or the use, occupancy, enjoyment or
operation of all or any portion thereof, unless and until Beneficiary, in person
or by agent, assumes actual possession thereof. Nor shall the appointment of any
receiver for the Property by any court at the request of Beneficiary or by
agreement with Grantor, or the entering into possession of any part of the
Property by such receiver, be deemed to make Beneficiary a
mortgagee-in-possession or otherwise responsible or liable in any manner with
respect to the Property Leases, the Property or the use, occupancy, enjoyment or
operation of all or any portion thereof.
(c) If Beneficiary or a receiver enters upon, takes possession of and
maintains control of the Property, all Revenues thereafter collected shall be
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applied first to the costs of taking control of and managing the Property and
collecting the Revenues, including, but not limited to, reasonable attorneys'
fees actually incurred, receiver's fees, premiums on receiver's bonds, costs of
repairs to the Property, premiums on insurance policies, Impositions and other
charges on the Property, and the costs of discharging any obligation or
liability of Grantor as landlord, lessor or licensor of the Property and then to
the Secured Obligations, in the manner set forth in the Credit Agreement. The
Collateral Agent and/or the receiver shall have access to the books and records
used in the operation and maintenance of the Property and shall be liable to
account only for those Revenues actually received. Beneficiary shall not be
liable to Grantor, anyone claiming under or through Grantor or anyone having an
interest in the Property by reason of anything done or left undone by
Beneficiary pursuant to Paragraph 17 hereof. If the Revenues are not sufficient
to meet the costs of taking control of and managing the Property and collecting
the Revenues, any monies expended by Beneficiary for such purposes shall become
a portion of the Secured Obligations. Unless Beneficiary and Grantor agree in
writing to other terms of payment, such amounts shall be payable upon notice
from Beneficiary to Grantor requesting payment thereof and shall bear interest
from the date of disbursement at the Default Rate, unless payment of interest at
such rate would be contrary to applicable law, in which event such amounts shall
bear interest at the highest rate which may be collected from Grantor under
Applicable Law. The entering upon and taking possession of and maintaining of
control of the Property by Beneficiary or the receiver pursuant to the
provisions of this Deed of Trust and the application of Revenues as provided
herein shall not cure or waive any Event of Default or invalidate any other
right or remedy of Beneficiary hereunder.
(d) At the Beneficiary's request, the Grantor shall enter into a
Subordination, Nondisturbance and Attornment Agreement in form and substance
reasonably acceptable to Beneficiary with respect to all Property Leases with
tenants of the Property which are not Affiliates of the Grantor.
13. Property Leases and Collection of Revenues. Grantor will not, without the
consent of the Collateral Agent in writing, which consent shall not be
unreasonably withheld or delayed, enter into any Property Lease of all or any
portion of the Property or amend, supplement or otherwise modify, or terminate
or cancel, or accept the surrender of, or consent to the assignment or
subletting of, or grant any concessions to or waive the performance of any
obligations of any tenant, lessee or licensee under, any now existing or future
Property Lease. Grantor agrees not to collect or accept the payment of any
Revenues, or other income or profit from, or on account of, any use or occupancy
of the Property, in advance of the time when such payment becomes due unless
such amount is delivered to Beneficiary to be applied to the Secured
Obligations, in the manner set forth in the Credit Agreement.
14. Remedies Cumulative. All remedies provided in this Deed of Trust are
distinct and cumulative to any other right or remedy under this Deed of Trust or
13
under the other Loan Documents or afforded by law or equity, and may be
exercised concurrently, independently or successively.
15. Taxation of Deeds of Trust. In the event of the enactment of any law
deducting from the value of the Property any mortgage Lien thereon, or imposing
upon Beneficiary the payment of all or part of the taxes, charges or assessments
previously paid by Grantor pursuant to this Deed of Trust, or changing the law
relating to the taxation of mortgages or debts secured by mortgages or
Beneficiary's interest in the Property so as to impose new incidents of tax on
Beneficiary, then Grantor shall pay such taxes or assessments or shall reimburse
Beneficiary therefor.
16. Events of Default and Acceleration. The occurrence of any "Event of Default"
as defined in the Credit Agreement shall constitute an Event of Default
hereunder. If an Event of Default shall have occurred and be continuing, the
Secured Obligations may be accelerated pursuant to the terms of the Credit
Agreement, whereupon the same shall become immediately due and payable, and
without presentment, protest, demand or other notice of any kind, all of which
are hereby expressly waived by Grantor. No omission to exercise such option when
entitled to do so shall be construed as a waiver of such right.
17. Rights and Remedies.
(a) Foreclosure and other Remedies. Upon the occurrence and during the
continuation of any Event of Default, and whether or not Beneficiary shall have
accelerated the maturity of the Secured Obligations pursuant to Paragraph 16
hereof, Trustee, at its option, may:
(i) exercise the rights and remedies afforded under Paragraph 17(b) below,
or exercise any of the following remedies to the extent available under the laws
of the State of Texas;
(ii) either with or without entering upon or taking possession of the
Property, demand, collect and receive any or all Revenues;
(iii) either with or without entering upon or taking possession of the
Property, and without assuming any obligations of Grantor thereunder, exercise
the rights of Grantor under, use or benefit from, any of the Property Leases;
(iv) in person, by agent or by court-appointed receiver, enter upon, take
possession of, and maintain full control of the Mortgaged Property in order to
perform all acts necessary or appropriate to maintain and operate the Mortgaged
Property, including, but not limited to, the execution, cancellation or
modification of Property Leases, the making of repairs to the Property and the
execution or termination of contracts
14
providing for the management or maintenance of the Property, all on such terms
as Trustee, in its sole discretion, deems proper or appropriate;
(v) proceed by a suit or suits in law or in equity or by other appropriate
proceeding to enforce payment of the Secured Obligations or the performance of
any term, covenant, condition or agreement of this Deed of Trust or the Credit
Agreement or any of the other Loan Documents, or any other right, and to pursue
any other remedy available to it, all as Trustee shall determine most effectual
for such purposes;
(vi) institute and maintain such suits and proceedings as Trustee may deem
expedient to prevent any impairment of the Mortgaged Property by any acts which
may be unlawful or in violation of this Deed of Trust, to preserve or protects
its interest in the Mortgaged Property and the Revenues, and to restrain the
enforcement of or compliance with any legislation or other governmental
enactment, rule or order that would impair the security hereunder or be
prejudicial to the interest of Trustee;
(vii) apply all or any portion of the Mortgaged Property, or the proceeds
thereof, towards (but not necessarily in complete satisfaction of) the Secured
Obligations, in the manner set forth in the Credit Agreement or the Security
Agreement, as applicable;
(viii) foreclose any and all rights of Grantor in and to the Property,
whether by sale, entry or in any other manner provided for hereunder or under
the laws of the State of Texas;
(ix) in the case of any receivership, insolvency, bankruptcy,
reorganization, arrangement, adjustment, composition or other proceedings
affecting Grantor or the creditors or property of Grantor, Beneficiary, to the
extent permitted by law, shall be entitled to file such proofs of claim and
other documents as may be necessary or advisable in order to have the claims of
Beneficiary allowed in such proceedings for the entire amount of the Secured
Obligations at the date of the institution of such proceedings and for any
additional portion of the Secured Obligations accruing after such date;
(x) exercise any other right or remedy of a mortgagee or secured party
under the laws of the State of Texas.
(b) Rights of Beneficiary and Trustee.
i. Upon the occurrence of an Event of Default, it shall thereupon, or at any
time thereafter while any part of the Secured Obligations remain undischarged,
be the duty of the Trustee, or his successors, as hereinafter provided, at the
request of Beneficiary (which request shall be presumed), to enforce this Trust
and to sell the Property, as
15
an entirety or in parcels, by one sale or by several sales, held at one time or
at different times, all as the Trustee acting may elect, each sale to be held in
the area of the county courthouse designated for the conduct of foreclosure
sales in any county in which a part of the real property to be sold is situated
and to be made on the first Tuesday of some month between the hours of 10
o'clock a.m. and 4 o'clock p.m. to the highest bidder for cash at public venue,
after the Trustee and Beneficiary shall have given notices of the proposed sale
in the manner hereinafter set forth, and to make due conveyance to the purchaser
or purchasers, with general warranty of title to such purchaser or purchasers
binding upon Grantor and its successors. Grantor, for itself and assigns, hereby
expressly and specifically waives all rights to a marshalling of the assets of
Grantor, including the Property, or to a sale in inverse order of alienation.
ii. The Trustee shall give notice of each such proposed sale by posting written
notice of the time, place and terms of sale at the courthouse door, and by
filing a copy of such written notice in the office of the county in which the
sale is to be made, at least twenty one (21) consecutive days preceding the date
of the sale. Where real properties to be sold are situated in more than one
county, one notice shall be posted at the courthouse door, and a copy of such
notice shall be filed with the county clerk, of each county, in which a part of
the real properties to be sold is situated, and such notices shall designate the
county where such real properties will be sold, which may be any county in which
a part of said real properties is situated. In addition to the foregoing notice
or notices to be posted and filed by the Trustee, the mortgage servicer of the
debt to which the power of sale is related (the "Mortgage Servicer") shall, at
least twenty one (21) days preceding the date of sale, serve or cause to be
served written notice of the proposed sale by certified mail on each debtor
obligated to pay such debt according to the records of such Mortgage Servicer.
The service of such notice shall be completed upon deposit of the notice,
enclosed in a prepaid wrapper, properly addressed to each such debtor at the
last known address, in a post office or official depository under the care and
custody of the United States Postal Service. The affidavit of any person having
knowledge of the facts to the effect that such service was completed shall be
prima facie evidence of the fact of service. In this respect and to the full
extent permitted by law, Grantor also expressly covenants, stipulates and agrees
16
that: (i) the address of Grantor set forth on the first page of this Deed of
Trust shall be deemed and considered conclusively to be and remain at all times
that last known address of all debtors obligated to pay such debt as shown by
the records of the Mortgage Servicer, provided such address may be changed from
time to time only by express written notice of change thereof signed by all
debtors obligated to pay such debt and actually delivered to and received by
Mortgage Servicer and setting forth a new address which shall be within the
United States of America and which shall be deemed and considered conclusively
to be and remain at all times thereafter the most recent address of all debtors
obligated to pay such debt as shown by the records of Mortgage Servicer until
changed in the manner herein provided, (ii) the records of Mortgage Servicer
shall not be deemed to reflect any change in the name or identity of the debtors
obligated to pay the debt (to whom notice of a proposed sale shall be required
to be mailed as provided for above) unless and until express written notice of
such change signed by all debtors obligated to pay such debt shall have been
actually delivered to and received by Mortgage Servicer, and (iii) no notice of
such sale or sales other than the notices hereinabove provided shall be required
to be given to Grantor or any other persons and any other notice is expressly
waived.
iii. The provisions of Subparagraph 17(b)ii above with respect to posting,
serving, filing and giving notices of sale are intended to comply with the
provisions of Section 51.002 of the Property Code of the State of Texas as in
effect on the date hereof (the "Subject Statutes"). In the event the requirement
for any notice, or the posting, serving, filing or giving thereof, under the
Subject Statutes shall be eliminated or the prescribed manner of posting,
serving, filing or giving same is modified by future amendment to the Subject
Statutes, the requirement for such particular notice shall be stricken from, or
the manner of posting, serving, filing or giving any notice hereunder modified
in, this instrument in conformity with such amendment. The manner herein
prescribed for posting, serving, filing or giving any notice, other than that to
be posted and filed or caused to be posted and filed by the Trustee, shall not
be deemed exclusive but such notice or notices may be posted, served, filed or
given in any other manner which may be permitted by applicable law. Further, in
relation to this Deed of Trust and the exercise of any power of sale by the
Trustee hereunder, if either the Subject Statutes shall be
17
amended or modified to require any other notice of the posting, filing, serving
or giving thereof or any statute hereafter enacted shall require any other
notice or the posting, filing, serving or giving thereof, the Trustee or the
person selected by him is hereby authorized and empowered by Grantor to give
such notice provided, however, Grantor waives such other notice or the posting,
filing, serving or giving thereof to the full extent Grantor may lawfully so do.
iv. At any sale conducted under this instrument, credit upon all or any part of
the Secured Obligations shall be deemed cash paid for the purpose of
Subparagraph 17(b)i above; and the holder of all or any part of the Secured
Obligations may purchase at any such sale. With the proceeds arising from such
sale or sales, the Trustee shall first pay all expenses of advertising, sale and
conveyance, including a reasonable Trustee's fee (not to exceed five percent
(5%) of the gross proceeds of such sale or sales) to the Trustee acting, and
shall next apply such proceeds toward the discharge and payment of the Secured
Obligations (including principal, interest and attorney's fees, if any), and the
remaining balance, if any, shall be paid to Grantor.
v. Without limiting any of the powers or remedies provided elsewhere, Grantor
agrees that in the event the Secured Obligations are payable in installments or
include, at any time, items of matured as well as unmatured indebtedness, the
holder of the matured installments or items of indebtedness, as the case may be,
shall have the right to have the Property sold subject to the part of the
Secured Obligations which is unmatured at the time the Trustee is requested to
make such sale, at Trustee's sale to satisfy the lien and security interest
hereof securing the then matured portion of said indebtedness and the Trustee is
expressly authorized and empowered to conduct such sale which is called herein
an "Installment Foreclosure." Any Installment Foreclosure made hereunder shall
not affect the liens, assignments and security interest of this Deed of Trust
existing to secure that portion of the Secured Obligations to which the sale is
to be made subject. No Installment Foreclosure shall exhaust the power of the
Trustee to conduct future Installment Foreclosures nor in anywise limit the
powers of sale provided elsewhere in this Deed of Trust. The provisions
elsewhere in this Deed of Trust relating to manner of conducting Trustee's
sales, including the posting, filing and giving of notices thereof,
18
shall also apply to any Installment Foreclosure and the same presumptions shall
be applicable to any Trustee's deed or recital therein contained in connection
with an Installment Foreclosure and to any other affidavit as hereinafter
provided.
vi. In the case of the absence of the Trustee from the State of Texas, or of his
death, inability, refusal or failure to act, or in the event the Beneficiary
should elect at any time (with or without cause) to remove the Trustee then
acting, a successor or substitute may be named, constituted and appointed by the
Beneficiary, without further formality than an appointment and designation in
writing, which appointment and designation shall be full evidence of the right
and authority to make the same and of all facts therein recited; and this
conveyance shall vest in the Successor or Substitute Trustee the title, powers
and duties conferred on the Trustee named herein and the conveyance by the
Successor or Substitute Trustee to the purchaser at any sale made pursuant
hereto shall be valid and effective as fully as hereinabove provided in the case
of a conveyance by the Trustee. Such right to appoint a Successor or Substitute
Trustee shall exist as often as and whenever the Trustee, original, successor or
substitute, cannot or will not act or has been removed by Beneficiary. Grantor
specifically covenants and stipulates that: the recitals in the conveyance made
to the purchaser, either by the Trustee or any Successor or Substitute Trustee,
shall be full proof and evidence of the matters therein stated; no other proof
shall be requisite of the request by the holder of the Secured Obligations on
the Trustee or on any Successor or Substitute Trustee to enforce this trust, or
of the due, timely and proper posting, filing and giving of all notices and
making of the sale, or any particulars thereof, or of the in ability, refusal or
failure of the Trustee, or any Successor or Substitute Trustee, to act, or of
the removal of the Trustee or any Successor or Substitute Trustee, as herein
provided, either as to the legality of his appointment or otherwise, or of the
contingencies which brought about the failure or inability of the Trustee or any
Successor or Substitute Trustee to act, or of his removal, as the case may be;
all pre requisites of said sale shall be presumed to have been performed; and
any such sale made under the powers herein granted shall be a perpetual bar
against Grantor, its successors and assigns.
19
vii. The right of sale hereunder shall not be exhausted by one or any sale, but
so long as any of the Secured Obligations remain undischarged, the Trustee or
successor or Substitute Trustee may make other and successive sales until all
the Property shall be legally sold.
viii. The Beneficiary shall have the power and authority to institute and
maintain any suits and proceedings as the Beneficiary may deem advisable (i) to
prevent any impairment of the Property by any acts which may be unlawful or any
violation of this Deed of Trust, (ii) to preserve or protect its interest in the
Property, and (iii) to restrain the enforcement of or compliance with any
legislation or other governmental enactment, rule or order that may be
unconstitutional or order that may be unconstitutional or otherwise invalid, if
the enforcement of or compliance with such enactment, rule or order might impair
the security hereunder or be prejudicial to the Beneficiary's interest.
ix. In the case of any receivership, insolvency, bankruptcy, reorganization,
arrangement, adjustment, composition, or other judicial proceedings affecting
the Grantor or any guarantor, co maker or endorser of any of the Grantor's
obligations, its creditors or its property, the Beneficiary, to the extent
permitted by law, shall be entitled to file such proofs of claim and other
documents as may be necessary or advisable in order to have its claims allowed
in such proceedings for the entire amount due and payable by the Grantor under
the Notes, this Deed of Trust and any other instrument securing the Notes, at
the date of the institution of such proceedings, and for any additional amounts
which may become due and payable by the Grantor after such date.
x. In case of a foreclosure sale of all or any part of the Property and of the
application of the proceeds of sale to the payment of the sums secured hereby,
the Beneficiary shall, unless precluded under the Notes from seeking a
deficiency judgment against the Grantor, be entitled to enforce payment from the
Grantor of all amounts then remaining due and unpaid and to recover judgment
against the Grantor for any portion thereof remaining unpaid, with interest.
(c) Receiver. If an Event of Default shall have occurred Beneficiary, upon
application to a court of competent jurisdiction, shall be entitled as a matter
20
of strict right without notice and without regard to the occupancy or value of
any security for the Secured Obligations or the solvency of any party bound for
its payment, to the appointment of a receiver to take possession of the
Mortgaged Property and to operate the Property and to collect and apply the
Revenues. The receiver shall have all of the rights and powers permitted under
the laws of the State of Texas. Grantor will pay to Beneficiary upon demand, all
expenses, including receiver's fees, attorneys' fees, costs and agent's
compensation, incurred pursuant to such appointment and all such expenses shall
be a portion of the Secured Obligations.
(d) Sale or Other Disposition of Mortgaged Property. Grantor waives any
right to require the marshaling of any of its assets in connection with any
disposition conducted pursuant hereto. In the event all or part of the Mortgaged
Property is included at any foreclosure sale conducted pursuant hereto, a single
total price for the Mortgaged Property, or such part thereof as is sold, may be
accepted by Beneficiary with no obligation to distinguish between the
application of such proceeds amongst the property comprising the Mortgaged
Property.
(e) Collection of Revenues. In connection with the exercise by Beneficiary
of the rights and remedies provided for in subparagraph (a)(ii) of this
Paragraph 17:
(i) Beneficiary may notify any tenant, lessee or licensee of the Property,
either in the name of Beneficiary or Grantor, to make payment of Revenues
directly to Beneficiary or Beneficiary's agents, may advise any person of
Beneficiary's interest in and to the Revenues, and may collect directly from
such tenants, lessees and licensees all amounts due on account of the Revenues;
(ii) At Beneficiary's request, Grantor will provide written notification to any
or all tenants, lessees and licensees of the Property concerning Beneficiary's
interest in the Revenues and will request that such tenants, lessees and
licensees forward payment thereof directly to Beneficiary;
(iii) Grantor shall hold any proceeds and collections of any of the Revenues in
trust for Beneficiary and shall not commingle such proceeds or collections with
any other funds of Grantor; and
(iv) Grantor shall deliver all such proceeds to Beneficiary immediately upon the
receipt thereof by Grantor in the identical form received, but duly endorsed or
assigned on behalf of Grantor to Beneficiary.
(f) Use and Occupation of Property. In connection with the exercise of the
Beneficiary's rights under Subparagraph (a)(v) of this Paragraph 17, Beneficiary
may enter upon, occupy, and use all or any part of the Property and
21
may exclude Grantor from the Land and the Improvements or portion thereof as may
have been so entered upon, occupied, or used. In the event Beneficiary manages
the Land and the Improvements in accordance with Subparagraph (a)(vi) herein,
Grantor shall pay to Beneficiary on demand a reasonable fee for the management
thereof in addition to the Secured Obligations. Further, Beneficiary may make
such alterations, renovations, repairs, and replacements to the Improvements, as
Beneficiary, in its sole discretion, deems proper or appropriate. The obligation
of Grantor to pay such amounts and all expenses incurred by Beneficiary in the
exercise of its rights hereunder shall be included in the Secured Obligations
and shall accrue interest at the Default Rate, unless collection from Grantor of
interest at such rate would be contrary to applicable law, in which event such
amounts shall bear interest at the highest rate which may be collected from
Grantor under applicable law.
(g) Partial Sales. Grantor agrees that in case Beneficiary, in the exercise
of the power of sale contained herein or in the exercise of any other rights
hereunder given, elects to sell in parts or parcels, said sales may be held from
time to time and that the power shall not be exhausted until all of the
Mortgaged Property not previously sold shall have been sold, notwithstanding
that the proceeds of such sales exceed, or may exceed, the Secured Obligations.
(h) Assembly of Mortgaged Property. Upon the occurrence of any Event of
Default, Beneficiary may require Grantor to assemble that portion of the
Mortgaged Property consisting of personal property and make it available to
Beneficiary, at Grantor's sole risk and expense, at a place or places to be
designated by Beneficiary which are reasonably convenient to both Beneficiary
and Grantor.
(i) Power of Attorney. Grantor hereby irrevocably constitutes and appoints
Beneficiary as Grantor's true and lawful attorney in fact, exercisable only
after the occurrence of and during the continuance of an Event of Default, to
take any action with respect to the Mortgaged Property to preserve, protect, or
realize upon Beneficiary's interest therein, each at the sole risk, cost and
expense of Grantor, but for the sole benefit of Beneficiary. The rights and
powers granted Beneficiary by the within appointment include, but are not
limited to, the right and power to: (i) prosecute, defend, compromise, settle,
or release any action relating to the Mortgaged Property; (ii) endorse the name
of Grantor in favor of Beneficiary upon any and all checks or other items
constituting Revenues; (iii) enter into leases or subleases relative to all or a
portion of the Land or the Improvements; (iv) enter into any contracts or
agreements relative to, and to take all action deemed necessary in connection
with, the construction of any Improvements on the Land; (v) manage, operate,
maintain, or repair the Land and the Improvements pursuant to Contracts or
otherwise; and (vi) exercise the rights of Grantor under any Property Leases or
any Contracts. Beneficiary shall not be obligated to perform any of such acts or
to exercise any of such powers, but if Beneficiary elects so to perform or
exercise, Beneficiary shall not be accountable for more than it actually
receives as a result of such exercise of power, and shall
22
not be responsible to Grantor except for Beneficiary's willful misconduct, gross
negligence or bad faith, as determined by a court of competent jurisdiction by
final and nonappealable judgment. All powers conferred upon Beneficiary by this
Deed of Trust (which shall only be exercised only after the occurrence of and
during the continuance of an Event of Default), being coupled with an interest,
shall be irrevocable until terminated by a written instrument executed by a duly
authorized officer of Beneficiary.
18. Notices. Any and all notices, demands, elections or requests provided
for or permitted to be given pursuant to this Deed of Trust shall be given or
served as provided in Section 9.1 of the Credit Agreement.
19. Successors and Assigns Bound; Captions. The covenants and agreements
herein contained shall bind, and the rights hereunder shall inure to, the
respective successors and assigns of Beneficiary and Grantor, subject to the
provisions of Paragraph 6 hereof. The captions and headings of the paragraphs of
this Deed of Trust are for convenience only and are not to be used to interpret
or define the provisions hereof.
20. Governing Law; Severability. This Deed of Trust and the obligations of
Grantor hereunder shall be governed by and interpreted and determined in
accordance with the laws of the State of New York except that the creation,
governance, administration and enforcement of Liens and rights and remedies with
respect to the Property shall be governed by and interpreted in accordance with
the laws of the State of Texas. In the event that any provision or clause of
this Deed of Trust or any other Loan Document conflicts with Applicable Law,
such conflict shall not affect other provisions of this Deed of Trust or such
Loan Document which can be given effect without the conflicting provision, and
to this end, the provisions of this Deed of Trust and the other Loan Documents
are declared to be severable. In the event that any Applicable Law limiting the
amount of interest or other charges permitted to be collected from Grantor is
interpreted by a court of competent jurisdiction in a final order so that any
charge for which provision is made in this Deed of Trust or in the other Loan
Documents, whether considered separately or together with other charges
permitted to be collected from Grantor, is interpreted so that any such charge,
whether considered separately or together with other charges that are considered
a part of the transaction represented by this Deed of Trust and the other Loan
Documents, violates such law, and Grantor is entitled to the benefit of such
law, such charge is hereby reduced to the extent necessary to eliminate such
violation. The amounts, if any, previously paid to Beneficiary in excess of the
amounts payable to Beneficiary pursuant to such charges as reduced shall be
applied by Beneficiary to reduce the principal of the Secured Obligations.
21. Discharge. This Agreement shall terminate and the Beneficiary shall
discharge this Deed of Trust when all the Secured Obligations have been
indefeasibly paid in full, the Lenders have no further commitment to lend, there
are no Letter of Credit Outstandings and the Issuing Banks have no further
23
commitment to issue Letters of Credit under the Credit Agreement. Grantor shall
pay Beneficiary's reasonable costs incurred in discharging this Deed of Trust.
22. Waivers. (i) Grantor agrees to the full extent permitted by law, that
in case of an Event of Default hereunder, neither Grantor nor anyone claiming
through or under Grantor shall or will set up, claim or seek to take advantage
of any appraisement, valuation, stay, extension, homestead, exemption or
redemption laws now or hereafter in force, in order to prevent or hinder the
enforcement or foreclosure of this Deed of Trust, or the absolute sale of the
Mortgaged Property, or the final and absolute putting into possession thereof,
immediately after such sale, of the purchasers thereat, and Grantor, for Grantor
and all who may at any time claim through or under Grantor, hereby waives to the
fullest extent that Grantor may lawfully so do, the benefit of all such laws,
and any and all right to have the assets comprised in the security intended to
be created hereby marshaled upon any foreclosure of the Lien hereof.
(ii) No failure or delay of the Collateral Agent in exercising any power or
right hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such a right or power, preclude any other or
further exercise thereof or the exercise of any other right or power. The rights
and remedies of the Beneficiary hereunder are cumulative and are not exclusive
of any rights or remedies that the Beneficiary would otherwise have. No waiver
of any provisions of this Agreement or any other Loan Document or consent to any
departure by Grantor therefrom shall in any event be effective unless the same
shall be permitted by paragraph (c) below, and then such waiver or consent shall
be effective only in the specific instance and for the purpose for which given.
No notice to or demand on the Grantor in any case shall entitle the Grantor to
any other or further notice or demand in similar or other circumstances.
(iii) Neither this Deed of Trust nor any provision hereof may be waived,
amended or modified except pursuant to an agreement or agreements in writing
entered into by the Beneficiary and the Grantor with respect to which such
waiver, amendment or modification is to apply, subject to any consent required
in accordance with Section 9.2 of the Credit Agreement.
(iv) In the event of the sale or transfer by operation of law or otherwise
of all or any part of the Mortgaged Property, Beneficiary, without notice, is
hereby authorized and empowered to deal with any such vendee or transferee with
reference to the Mortgaged Property or the Secured Obligations or with reference
to any of the terms, covenants, conditions or agreements hereof, as fully and to
the same extent as it might deal with the original parties hereto and without in
any way releasing or discharging any liabilities, obligations or undertakings
(including, without limitation, the restrictions upon transfer contained in
Paragraph 5).
24
(v) In the event an interest in any of the Property is foreclosed upon
pursuant to a judicial or nonjudicial foreclosure sale, Grantor agrees as
follows: notwithstanding the provisions of Sections 51.003, 51.004, and 51.005
of the Texas Property Code (as the same may be amended from time to time), and
to the extent permitted by law, Grantor agrees that Beneficiary shall be
entitled to seek a deficiency judgment from Grantor and any other party
obligated on the Credit Extensions equal to the difference between the amount
owing on the Credit Extensions and the amount for which the Mortgaged Property
was sold pursuant to judicial or nonjudicial foreclosure sale. Grantor expressly
recognizes that this section constitutes a waiver of the above-cited provisions
of the Texas Property Code which would otherwise permit Grantor and other
Persons against whom recovery of deficiencies is sought or Grantor independently
(even absent the initiation of deficiency proceedings against them) to present
competent evidence of the fair market value of the Mortgaged Property as of the
date of the foreclosure sale and offset against and deficiency the amount by
which the foreclosure sale price is determined to be less than such fair market
value. Grantor further recognizes and agrees that this waiver creates an
irrebuttable presumption that the foreclosure sale price is equal to the fair
market value of the Property for purposes of calculating deficiencies owed by
Grantor, Guarantor, and others against whom recovery of a deficiency is sought.
(vi) Neither Beneficiary nor any affiliate of Beneficiary has made any
representation, warranty or statement to Grantor in order to induce Grantor to
execute this Deed of Trust. Grantor hereby expressly waives any claim of
fraudulent inducement to execute this Deed of Trust and further disclaims any
reliance or statements on or representations of Beneficiary in waiving such
claim.
23. Further Assurances. At any time and from time to time, upon request by
the Collateral Agent, Grantor will make, execute and deliver, or cause to be
made, executed and delivered, to the Collateral Agent and, where appropriate,
cause to be recorded and/or filed and from time to time thereafter to be
re-recorded and/or refiled at such time and in such offices and places as shall
be deemed desirable by the Collateral Agent, any and all such other and further
assignments, mortgages, security agreements, financing statements, continuation
statements, instruments of further assurance, certificates and other documents
as may, in the opinion of the Collateral Agent, be necessary or desirable in
order to effectuate, complete, or perfect, or to continue and preserve (a) the
obligations of Grantor under this Deed of Trust, and (b) the Lien created by
this Deed of Trust upon the Mortgaged Property. Upon any failure by Grantor so
to do, Beneficiary may make, execute, record, file, re-record and/or refile any
and all such assignments, mortgages, security agreements, financing statements,
continuation statements, instruments, certificates, and documents for and in the
name of Grantor, and Grantor hereby irrevocably appoints Beneficiary the agent
and attorney in fact of Grantor so to do.
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24. Subrogation. Beneficiary shall be subrogated to all right, title, Lien
or equity of all persons to whom Beneficiary may have paid any monies in
settlement of Liens or in acquisition of title or for its benefit hereunder, or
for the benefit or account of Grantor or subsequently paid under any provisions
hereof.
25. Time of the Essence. Time is of the essence with respect to each and
every covenant, agreement and obligation of Grantor under this Deed of Trust and
any and all other Loan Documents.
26. Beneficiary's Fees and Expenses; Indemnification. (a) Without in anyway
limiting any other reimbursement obligations contained under the other Loan
Documents, the Grantor agrees to pay upon demand to the Beneficiary the amount
of any and all reasonable expenses, including the reasonable fees, disbursements
and other charges of its counsel and of any experts or agents, which the
Beneficiary may incur in connection with the exercise, enforcement or protection
of any of the rights of the Beneficiary hereunder.
(b) Without limitation of its indemnification obligations under the other
Loan Documents, the Grantor agrees to indemnify the Beneficiary and the other
Indemnitees against, and hold each of them harmless from, any and all losses,
claims, damages, liabilities and related expenses, including reasonable fees,
disbursements and other charges of counsel, incurred by or asserted against any
of them arising out of, in any way connected with, or as a result of, the
execution, delivery or performance of this Deed of Trust or any claim,
litigation, investigation or proceeding relating hereto or to the Mortgaged
Property, whether or not any Indemnitee is a party thereto; provided that such
indemnity shall not, as to any Indemnitee, be available to the extent that such
losses, claims, damages, liabilities or related expenses are determined by a
court of competent jurisdiction by final and nonappealable judgment to have
resulted from the gross negligence, bad faith, or willful misconduct of such
Indemnitee.
(c) Any such amounts payable as provided hereunder shall be additional
Secured Obligations secured hereby and by the other Security Documents. The
provisions of this Paragraph 26 shall remain operative and in full force and
effect regardless of the termination of this Deed of Trust or any other Loan
Document, the consummation of the transactions contemplated hereby, the
repayment of any of the Secured Obligations, the invalidity or unenforceability
of any term or provision of this Deed of Trust or any other Loan Document, or
any investigation made by or on behalf of the Beneficiary or any Secured Party.
All amounts due under this Paragraph 26 shall be payable on written demand
therefor.
27. Submission to Jurisdiction. GRANTOR AGREES THAT ANY SUIT FOR THE
ENFORCEMENT OF THIS DEED OF TRUST MAY BE BROUGHT IN THE COURTS OF THE STATE OF
NEW YORK SITTING IN THE BOROUGH OF MANHATTAN OR ANY FEDERAL COURT SITTING
THEREIN AS THE BENEFICIARY MAY ELECT IN ITS SOLE
26
DISCRETION AND CONSENTS TO THE NON-EXCLUSIVE JURISDICTION OF SUCH COURTS.
GRANTOR AND BENEFICIARY (BY ITS ACCEPTANCE OF THIS DEED OF TRUST) EACH HEREBY
WAIVES ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH
SUIT OR ANY SUCH COURT OR THAT SUCH SUIT IS BROUGHT IN AN INCONVENIENT FORUM AND
AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE
CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR
IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS DEED OF TRUST OR ANY OTHER
LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT BENEFICIARY MAY OTHERWISE HAVE TO
BRING ANY ACTION OR PROCEEDING RELATING TO THIS DEED OF TRUST AGAINST
BENEFICIARY OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.
GRANTOR AGREES THAT ANY ACTION COMMENCED BY GRANTOR ASSERTING ANY CLAIM OR
COUNTERCLAIM ARISING UNDER OR IN CONNECTION WITH THIS DEED OF TRUST OR ANY OTHER
LOAN DOCUMENT SHALL BE BROUGHT SOLELY IN A COURT OF THE STATE OF NEW YORK
SITTING IN THE BOROUGH OF MANHATTAN OR ANY FEDERAL COURT SITTING THEREIN AS THE
BENEFICIARY MAY ELECT IN ITS SOLE DISCRETION AND CONSENTS TO THE EXCLUSIVE
JURISDICTION OF SUCH COURTS WITH RESPECT TO ANY SUCH ACTION.
GRANTOR AND BENEFICIARY (BY ITS ACCEPTANCE OF THIS DEED OF TRUST) IRREVOCABLY
CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 9.1
OF THE CREDIT AGREEMENT. NOTHING IN THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT
WILL AFFECT THE RIGHT OF GRANTOR AND BENEFICIARY TO SERVE PROCESS IN ANY OTHER
MANNER PERMITTED BY LAW.
28. WAIVER OF JURY TRIAL. GRANTOR AND BENEFICIARY (BY ITS ACCEPTANCE OF
THIS DEED OF TRUST) EACH HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY RIGHT TO A JURY IN ANY TRIAL OF ANY CASE OR CONTROVERSY
(WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY) IN WHICH ANY SUCH PERSON
IS OR BECOMES A PARTY (WHETHER SUCH CASE OR CONTROVERSY IS INITIATED BY OR
AGAINST ANY SUCH PERSON OR IN WHICH ANY SUCH PERSON IS JOINED AS A PARTY
LITIGANT), WHICH CASE OR CONTROVERSY ARISES OUT OF OR IS IN RESPECT OF, ANY
RELATIONSHIP AMONGST OR BETWEEN ANY LOAN PARTY OR ANY OTHER PERSON AND ANY
SECURED PARTY OR PARTICIPANT OR THE ACTIONS OF ANY SECURED PARTY IN THE
NEGOTIATION,
27
ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF. EACH OF GRANTOR AND
BENEFICIARY (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER
PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT,
IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, AND (B)
ACKNOWLEDGES THAT IT AND THE OTHER PARTY HAVE BEEN INDUCED TO ENTER INTO THIS
DEED OF TRUST BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN
THIS PARAGRAPH 28.
29. Choice of Law. This Deed of Trust and each of the other Loan Documents
shall in all respects be governed, construed, applied and enforced in accordance
with the internal laws of the State of New York without regard to principles of
conflicts of law, except that matters relating to the creation, perfection,
priority and enforcement of the liens on and security interests in the Mortgaged
Property or other assets situated in Texas, including by way of illustration,
but not in limitation, actions for foreclosure, for injunctive relief, or for
the appointment of a receiver, shall be governed by the laws of the State of
Texas.
30. Future Advances. This Deed of Trust secures future advances made
pursuant to this Deed of Trust or the Credit Agreement.
31. Business Loan: Not Personal Residence. Grantor covenants, warrants and
represents that this Deed of Trust is a commercial loan and that all of the
proceeds of the Credit Extensions secured hereby shall be used for business or
commercial purposes, none of the proceeds of the Credit Extensions secured
hereby shall be used for personal, family or household purposes, and that no
individual liable for the Secured Obligations resides or intends to reside in
any portion of the Property.
32. Warranties and Representations. It is intended that this Deed of Trust
supplement the other Loan Documents, and the warranties, representations,
covenants and agreements made by the Grantor herein are supplemental to those
set forth in the other Loan Documents. In the event of a conflict between this
Deed of Trust and the other Loan Documents, the terms of this Deed of Trust
shall control with respect to the Land, the Improvements, the Property Leases
and the Revenues.
33. Fixture Filing. Certain of the Mortgaged Property is or will become
"fixtures" (as that term is defined in the UCC) on the Land, and this Deed of
Trust upon being filed for record in the real estate records of the county
wherein such fixtures are situated shall operate also as a financing statement
filed as a fixture filing in accordance with the applicable provisions of said
UCC upon such of the Mortgaged Property that is or may become fixtures.
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34. NOTICE OF INDEMNIFICATION: GRANTOR HEREBY ACKNOWLEDGES AND AGREES THAT
THIS DEED OF TRUST CONTAINS CERTAIN INDEMNIFICATION PROVISIONS (INCLUDING
WITHOUT LIMITATION THOSE CONTAINED IN SECTIONS 6(iii) AND 26(b) HEREOF, WHICH IN
CERTAIN CIRCUMSTANCES, COULD INCLUDE AN INDEMNIFICATION OF THE COLLATERAL AGENT
AND BENEFICIARY FROM CLAIMS OR LOSSES ARISING AS A RESULT OF THE COLLATERAL
AGENT'S AND BENEFICIARY'S OWN NEGLIGENCE.
THE WRITTEN DEED OF TRUST REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND
MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT
ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN
THE PARTIES.
[Remainder of page left intentionally blank]
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IN WITNESS WHEREOF, Grantor has executed this Deed of Trust under seal, as
of the day and year first above written.
Witness: GAMESTOP TEXAS LP
By: GameStop of Texas (GP), LLC,
its general partner
By: GameStop, Inc.
/s/ Dawn Hofer By: /s/ David W. Carlson
------------------------------------ --------------------------
Print Name: Dawn Hofer
Name: David W. Carlson
/s/ Matt Hodges
-----------------------------------
Print Name: Matt Hodges Title: Executive Vice President
and Chief Financial Officer
30
STATE OF TEXAS
Tarrant County
On this 5th day of October, 2005, before me personally appeared the
above-named David W. Carlson, the Executive Vice President and Chief Financial
Officer of GameStop, Inc., a Minnesota corporation, which is the manager of
GameStop of Texas (GP), LLC, the general partner of GameStop Texas LP, the
Grantor named above, and acknowledged the foregoing to be his/her free act and
deed and the free act and deed of said Grantor.
/s/ Glenda Williams
-------------------------------
Notary Public
My commission expires:
(AFFIX SEAL)
31
EXHIBIT A
LAND
Legal Description of Land
Being a 17.02 acre tract of land situated in the City of Grapevine, Tarrant
County, Texas, being a part of the C. Clanton Survey Abstract Number 354, and
being all of Lot 2, Block 2 of Westport Business Park, an addition to the City
of Grapevine as recorded in Cabinet A, Slide 5797 of the Plat Records of Tarrant
County, Texas.
900652.2900652.2
32
To Be Recorded In The Land
Records of Tarrant County, Texas,
AFTER RECORDATION PLEASE RETURN TO:
David S. Berman, Esq.
Riemer & Braunstein LLP
Three Center Plaza
Boston, MA 02108
NOTICE OF CONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL PERSON, YOU MAY
REMOVE OR STRIKE ANY OF THE FOLLOWING FROM THIS INSTRUMENT BEFORE IT IS FILED
FOR RECORD IN THE PUBLIC RECORDS: YOUR SOCIAL SECURITY NUMBER OR YOUR DRIVERS
LICENSE NUMBER.
DEED OF TRUST
AND
ABSOLUTE ASSIGNMENT OF LEASES AND RENTS
THIS DEED OF TRUST AND ABSOLUTE ASSIGNMENT OF LEASES AND RENTS (hereinafter
referred to as this "Deed of Trust") is made and entered into as of this 11th
day of October, 2005, by GAMESTOP TEXAS LP, a limited partnership organized
under the laws of the State of Texas, as grantor or mortgagor (hereinafter
referred to as "Grantor"), Grantor having its principal place of business at 625
Westport Parkway, Grapevine, Texas 76051, in favor of Stephen Garvin, an
individual and officer of the Collateral Agent, as Trustee ("Trustee") for the
use and benefit of BANK OF AMERICA, N.A., as grantee or beneficiary, as
collateral agent, (in such capacity, the "Collateral Agent") for the ratable
benefit of the Secured Parties (hereinafter in such capacity referred to as
"Beneficiary"), Beneficiary having an office at 40 Broad Street, 10th Floor,
Boston, Massachusetts 02109.
Each capitalized term used herein but not defined herein shall have the
meaning assigned to such term in the Credit Agreement (as defined herein).
W I T N E S S E T H:
A. Reference is made to that certain Credit Agreement dated as of even date
herewith (as the same may be amended, modified, supplemented or restated
hereafter, the "Credit Agreement"), by, among others, (i) the Grantor and
certain Affiliates of the Grantor (singly, a "Borrower", and collectively, the
"Borrowers"), (ii) the Lenders named therein, (iii) Bank of America, N.A., as
Administrative Agent and Collateral Agent for the Lenders, (iv) Citicorp North
America, Inc., as Syndication Agent, (v) Merrill Lynch Capital, a division of
Merrill Lynch Business Financial Services Inc., as Documentation Agent, (vi)
Bank of America, N.A. and Citicorp North America, Inc., as Issuing Banks, and
(vii) Banc of America Securities LLC, Citigroup Global Markets Inc. and Merrill
Lynch Capital, a Division of Merrill Lynch Business Financial Services Inc., as
Joint Lead Arrangers and Joint Lead Bookrunners.
B. Pursuant to the Credit Agreement, each of the Lenders have agreed to
lend to the Borrowers, on a revolving basis, Revolving Loans, at any time and
from time to time prior to the Termination Date, the Swingline Lender has agreed
to lend, on a revolving basis, Swingline Loans, at any time and from time to
time prior to the Termination Date, and the Issuing Banks have issued and have
agreed to issue Letters of Credit for the benefit of the Borrowers at any time
and from time to time prior to the Termination Date, in each case upon the terms
and subject to the conditions specified in, the Credit Agreement.
C. The obligations of the Lenders to make Loans and of the Issuing Banks to
issue Letters of Credit are conditioned upon, among other things, the execution
and delivery by the Grantor of this Deed of Trust, to secure the due and
punctual payment and performance of the following described indebtedness and
obligations: (a) all Obligations; and (b) any and all additional advances made
by any Secured Party, to the extent made consistent with the terms hereof, to
protect or preserve the Mortgaged Property or the security interest created
hereby on the Mortgaged Property, or for taxes, assessments or insurance
premiums as hereinafter provided or for performance of any of Grantor's
obligations hereunder or under the other Loan Documents or for any other purpose
provided herein or in the other Loan Documents (whether or not the original
Grantor remains the owner of the Mortgaged Property at the time of such
advances) (hereinafter (a) and (b) shall collectively be referred to as the
"Secured Obligations").
D. Pursuant to the requirements of the Credit Agreement, the Grantor is
granting this Deed of Trust in favor of the Beneficiary, for the ratable benefit
of the Secured Parties to create a security interest in the Mortgaged Property
(as defined herein) to secure the performance and payment by the Grantor of the
Secured Obligations. The Credit Agreement also requires the granting by the
Grantor and/or other Borrowers of other mortgages (the "Other Deeds of Trust")
that create security interests in certain mortgaged properties other than the
Property to secure the performance of the Secured Obligations.
GRANTING CLAUSE:
NOW THEREFORE, IN CONSIDERATION OF TEN AND NO/100 DOLLARS ($10.00) AND
OTHER GOOD AND VALUABLE CONSIDERATION, the receipt and sufficiency whereof are
hereby acknowledged by Grantor, and in order to secure the Secured Obligations,
Grantor does hereby grant, bargain, sell, transfer, assign, mortgage, warrant
and convey unto the Trustee, his heirs, successors and assigns for the benefit
of the Beneficiary for the ratable benefit of the Secured Parties, and their
respective successors and assigns, all of the following described property
(hereinafter those items of property described in subparagraphs (a) and (b),
below, collectively referred to as the "Property", and together with the
property described in subparagraphs (c), (d) and (e), collectively, the
"Mortgaged Property"):
(a) All those certain tracts or parcels of land described in Exhibit A
attached hereto and by this reference made a part hereof, together with all
right, title and interest of Grantor, including any after-acquired title or
reversion, in and to the rights-of-ways, streets, and alleys adjacent thereto,
and all easements, rights-of-way, licenses, operating agreements, strips and
gores of land, vaults, streets, ways, alleys, passages, sewers, sewer rights,
waters, water courses, water rights and powers, oil, gas and other minerals,
flowers, shrubs, crops, trees, timber and other emblements now or hereafter
located on such land or under or above same,
2
and all estates, rights, titles, interests, privileges, liberties, tenements,
hereditaments and appurtenances whatsoever, in any way belonging, relating to or
appertaining to said tracts or parcels of land or any part thereof, or which
hereafter shall in any way belong, relate or be appurtenant thereto, whether now
owned or hereafter acquired by Grantor and the reversion and reversions,
remainder and remainders, and all the estate, right, title, interest, property,
possession, claim and demand whatsoever at law, as well as in equity, of the
Grantor of, in and to the same (hereinafter referred to as the "Land"); and
(b) All buildings, structures, parking areas, landscaping, fixtures, and
other improvements of every nature now or hereafter situated, erected or placed
on the Land (hereinafter referred to as the "Improvements"); and
(c) All present and future leases, tenancies, occupancies and licenses,
whether written or oral ("Property Leases") of the Land, and the Improvements,
or any combination or part thereof, and all income, rents, issues, royalties,
profits, revenues, security deposits and other benefits of the Land, and the
Improvements, from time to time accruing, all payments under Property Leases,
and all payments on account of oil and gas and other mineral Property Leases,
working interests, production payments, royalties, overriding royalties, rents,
delay rents, operating interests, participating interests and other such
entitlements, and all the estate, right, title, interest, property, possession,
claim and demand whatsoever at law, as well as in equity, of Grantor of, in and
to the same (hereinafter referred to as the "Revenues"); and
(d) To the extent assignable, all the right, title and interest of Grantor
in and to all construction contracts, subcontracts, architectural agreements,
labor, material and payment bonds, guaranties and warranties, and plans and
specifications relating to the construction of Improvements on the Land, whether
now or hereafter existing, including, without limitation (i) any architectural
or engineering agreement entered into with respect to the design of said
Improvements and other architectural or engineering services, (ii) the plans and
specifications for the construction of said Improvements prepared by the
architect, and (iii) any contractor's agreement entered into with respect to
construction of Improvements on the Land (hereinafter collectively referred to
as the "Contracts"); and
(e) All insurance proceeds and all other proceeds (including all Proceeds
as defined in the UCC), products, substitutions and accessions of the foregoing
of every type.
TO HAVE AND TO HOLD the Property and all parts, rights, members and
appurtenances thereof, to the use and benefit of Trustee, his heirs, successors
and assigns for the benefit of the Beneficiary for the ratable benefit of the
Secured Parties, and their respective successors and assigns, in fee simple
forever; and Grantor covenants that Grantor is lawfully seized and possessed of
the Property and holds indefeasible fee simple absolute title to the Land, and
has good right to convey the Property and that the
3
conveyances in this Deed of Trust are subject to only to Permitted Encumbrances.
Except for the Permitted Encumbrances, Grantor does warrant and will forever
defend the title to the Mortgaged Property against the claims of all persons
whomsoever.
This Deed of Trust is intended to constitute: (i) a security agreement,
fixture filing and financing statement under the Uniform Commercial Code in
effect from time to time in the State of Texas (the "UCC"), (ii) a deed of trust
under the Texas Property Code, as amended, and (iii) a notice of assignment of
rents or profits under the Texas Property Code, as amended. This Deed of Trust
is also intended to operate and be construed as an absolute present assignment
of the rents, issues and profits of the Property, Grantor hereby agreeing, as
provided for under law of the State of Texas, that Beneficiary is entitled to
receive the rents, issues and profits of the Property prior to an Event of
Default and without entering upon or taking possession of the Property. Some of
the items included within the Property are or are to be come "fixtures" (as that
term is defined in the UCC) on the Land and, as provided under the UCC, this
Deed of Trust, upon being filed for record in the real property records of
Tarrant County, Texas, shall operate also as a "fixture filing" and financing
statement upon such of the items which are or may become fixtures.
This Deed of Trust is given to secure the payment and performance of the
Secured Obligations, to the extent provided for herein.
Grantor hereby further covenants and agrees with Trustee and Beneficiary as
follows:
1. Payment and Performance of Secured Obligations.
Grantor shall promptly pay the Secured Obligations when due, and fully and
promptly perform all of the provisions, agreements, covenants and obligations of
the Grantor, subject to all applicable grace and cure periods.
2. Impositions, Liens and Charges.
Grantor shall pay all the yearly water and sewer bills, real estate taxes,
ad valorem taxes, personal property taxes, assessments, betterments, common area
maintenance charges, all governmental charges of every name and restriction
which may be levied on the Property as well as the yearly premium installments
for the insurance covering the Property as required pursuant to Paragraph 2
hereof (hereinafter collectively referred to as the "Impositions") and other
charges, if any, attributable to the Property, subject to the Grantor's right to
contest, provided such contest complies with terms of Section 5.5 of the Credit
Agreement. Grantor shall furnish to the Collateral Agent all bills and notices
of amounts due under this Paragraph 2 as soon as received, and, Grantor shall
furnish to the Collateral Agent evidence of such payments at least five (5) days
prior to the dates on which such payments are delinquent for taxes. Grantor
shall promptly discharge (by bonding, payment or otherwise) any Lien filed
against the Property (other than Permitted Encumbrances).
4
3. Property and Other Insurance. (a) The Grantor shall (i) maintain or
shall cause to be maintained insurance with financially sound and reputable
insurers reasonably acceptable to the Collateral Agent on the Property and in at
least such amounts and against at least such risks as is customary with
companies in the same or similar businesses operating in the same or similar
locations, including public liability insurance against claims for personal
injury or death occurring upon, in or about or in connection with the use of any
properties owned, occupied or controlled by it; (ii) maintain such other
insurance as may be required by law; and (iii) furnish to the Collateral Agent,
upon written request, full information as to the insurance carried.
(b) Fire and extended coverage policies maintained with respect to any
Property shall be endorsed or otherwise amended to include (i) a
non-contributing Collateral Agent clause (regarding the Improvements), in form
and substance reasonably satisfactory to the Collateral Agent, which
endorsements or amendments shall provide that the insurer shall pay all proceeds
otherwise payable to the Grantor under the policies directly to the Collateral
Agent, (ii) a provision to the effect that none of the Grantor, Secured Parties
nor any other Person shall be a co-insurer, and (iii) such other provisions as
the Collateral Agent may reasonably require from time to time to protect the
interests of the Secured Parties. Commercial general liability policies shall be
endorsed to name the Collateral Agent as an additional insured. Business
interruption policies shall name the Collateral Agent as loss payee and shall be
endorsed or amended to include (i) a provision that, from and after the Closing
Date, the insurer shall pay all proceeds the insurer shall pay all proceeds in
excess of $5,000,000 otherwise payable to the Grantor under the policies
directly to the Collateral Agent, provided, however, that the Collateral Agent
hereby agrees that prior to the occurrence of an Event of Default or a Cash
Dominion Event, the Collateral Agent shall remit all proceeds received by
Collateral Agent under the policies to Grantor, provided further that after the
occurrence of an Event of Default or a Cash Dominion Event, the Collateral Agent
shall apply any proceeds received in accordance with Section 2.22 of the Credit
Agreement or Section 6.2 of the Security Agreement, as applicable, (ii) a
provision to the effect that none of the Grantor, the Secured Parties or any
other Person shall be a co-insurer and (iii) such other provisions as the
Collateral Agent may reasonably require from time to time to protect the
interests of the Lenders. Each such policy referred to in this paragraph also
shall provide (i) that it shall not be canceled or modified except upon not less
than 30 days' prior written notice thereof by the insurer to the Collateral
Agent (giving the Collateral Agent the right to cure defaults in the payment of
premiums) and (ii) that it shall not be not renewed except upon not less than 15
days' prior written notice thereof by the insurer to the Collateral Agent
(giving the Collateral Agent the right to cure defaults in the payment of
premiums). The Grantor shall deliver to the Collateral Agent, prior to the
cancellation, modification or nonrenewal of any such policy of insurance, a copy
of a renewal or replacement policy (or other evidence of renewal of a policy
previously delivered to the Collateral Agent) together with evidence
satisfactory to the Collateral Agent of payment of the premium therefor.
5
(c) In the event that the Grantor at any time or times shall fail to obtain
or maintain any of the policies of insurance required hereby or to pay any
premium in whole or part relating thereto, the Collateral Agent may, without
waiving or releasing any obligation or liability of the Grantor hereunder or any
Default or Event of Default, in its sole discretion, obtain and maintain such
policies of insurance and pay such premium and take any other actions with
respect to as the Collateral Agent deems advisable. All sums disbursed by the
Collateral in connection with this Paragraph 3(c), including reasonable
attorneys' fees, court costs, expenses and other charges relating thereto, shall
be payable, upon demand, by the Grantor to the Collateral Agent and shall be
additional Secured Obligations secured hereby.
(d) In the event of any loss or damage to the Property, the Grantor shall
give immediate written notice to the insurance carrier and to the Collateral
Agent. Grantor hereby irrevocably makes, constitutes and appoints the Collateral
Agent (and all officers, employees or agents designated by the Collateral Agent)
as Grantor's true and lawful agent and attorney-in-fact, whether or not an Event
of Default has occurred, to make proof of such loss, to adjust and compromise
any claim under insurance policies, and to appear in and prosecute any action
arising from such insurance policies. Whether or not an Event of Default has
occurred, the Collateral Agent is authorized to collect and receive insurance
proceeds, and to deduct therefrom Collateral Agent's expenses incurred in the
collection of such proceeds. Grantor further authorizes the Collateral Agent, at
Collateral Agent's option, whether or not an Event of Default has occurred, to
apply the balance of such proceeds to the payment of the Secured Obligations in
accordance with the terms of the Credit Agreement.
(e) TEXAS FINANCE CODE Section 307.052 COLLATERAL PROTECTION INSURANCE
NOTICE: (A) GRANTOR IS REQUIRED TO: (i) KEEP THE MORTGAGED PROPERTY INSURED
AGAINST DAMAGE IN THE AMOUNT EQUAL TO THE GRANTOR'S INDEBTEDNESS TO COLLATERAL
AGENT AND THE SECURED PARTIES; (ii) PURCHASE THE INSURANCE FROM AN INSURER THAT
IS AUTHORIZED TO OD BUSINESS IN THE STATE OF TEXAS OR AN ELIGIBLE SURPLUS LINES
INSURER; AND (iii) NAME THE BENEFICIARY AS THE PERSON TO BE PAID UNDER THE
POLICY IN THE EVENT OF LOSS; (B) GRANTOR MUST, IF REQUIRED BY BENEFICIARY,
DELIVER TO BENEFICIARY A COPY OF THE POLICY AND PROOF OF THE PAYMENT OF
PREMIUMS; AND (C) IF GRANTOR FAILS TO MEET ANY REQUIREMENT LISTED IN CLAUSE (A)
OR (B) ABOVE, THE BENEFICIARY MAY OBTAIN COLLATERAL PROTECTION INSURANCE ON
BEHALF OF THE GRANTOR AT THE GRANTOR'S EXPENSE.
4. Preservation and Maintenance. Grantor (a) shall not permit or commit waste,
impairment, or deterioration of the Property or abandon the Property, (b) shall
restore or repair promptly and in a good and workmanlike manner all or
6
any part of the Property in the event of any damage, injury or loss thereto, to
the equivalent of its condition prior to such damage, injury or loss, or such
other condition as the Collateral Agent may approve in writing, (c) shall keep
the Property, including the Improvements, in good order, repair and tenantable
condition and shall replace fixtures, equipment, machinery and appliances on the
Property when necessary to keep such items in good order, repair, and tenantable
condition, and (d) shall comply with all laws, ordinances, regulations and
requirements of any governmental body, as well as any reciprocal easement
agreements or covenants of record, applicable to the Property, subject to the
Grantor's right to contest, provided such contest complies with terms of Section
5.5 of the Credit Agreement. Grantor covenants and agrees to give the Collateral
Agent prompt notice of any non-compliance with such laws, ordinances,
regulations or requirements and of any notice of non-compliance therewith which
it receives or any threatened or pending proceedings in respect thereto or with
respect to the Property. Neither Grantor nor any tenant or other person shall
remove, demolish or alter any Improvements now existing or hereafter erected on
the Property, without the prior consent of the Collateral Agent, not to be
unreasonably withheld, except to the extent the same would impair the structural
integrity or value of the Property.
5. Transfers. Except as otherwise provided in the Credit Agreement, Grantor will
not, directly or indirectly, without the prior written consent of the Collateral
Agent in each instance: (a) sell, convey, assign, transfer, option, mortgage,
pledge, hypothecate or dispose of the Mortgaged Property, or any part thereof or
interest therein; or (b) create or suffer to be created or to exist any Lien,
restriction, or attachment of any kind upon the Mortgaged Property, or any part
thereof or interest therein other than the Permitted Encumbrances.
6. Hazardous Materials Warranties and Indemnification.
(i) Environmental Representations and Warranties of Grantor. In addition to
the representations and warranties made in Credit Agreement, Grantor represents
and warrants to each Secured Party as follows:
(i) There are no existing or closed underground storage tanks ("USTs") on
the Property (i) from which Hazardous Materials have been released or leaked to
the environment, or (ii) that are not in compliance with all federal, state, and
local laws and regulations covering the installation, operation, maintenance and
abandonment of USTs.
(ii) None of the following will hereafter be brought on or constitute a
part of the Property: friable asbestos or friable asbestos-containing material;
urea formaldehyde insulation; transformers or other equipment which contain
dielectric fluid containing polychlorinated biphenyls; or leaded paint, except
as may be brought on the Property in accordance with law or for use or sale in
connection with the current use of the Property.
7
(iii) There are no existing or closed sanitary landfills, solid waste
disposal sites, or hazardous waste treatment, storage or disposal facilities on
the Property except as have been disclosed to relevant Governmental Authorities
and as have been regulated, operated, monitored, assessed and (as necessary)
remediated in accordance with law.
(iv) To the best of Grantor's knowledge, no pending or current notice has
been issued to Grantor by any agency, authority, or unit of government that
Grantor has been identified as a potentially responsible party under any
Environmental Law.
(v) To the best of Grantor's knowledge, there exists no pending or current
investigation, action, proceeding, or claim by any Governmental Authority or by
any third party which could result in any liability, penalty, sanction, or
judgment under any Environmental Law with respect to any condition, use or
operation of the Property.
(ii) Environmental Covenants of Grantor. In addition to the Grantor's
covenants in the Credit Agreement, the Grantor covenants and agrees with each
Secured Party that Grantor shall:
(i) remain in material compliance with all Environmental Laws;
(ii) not store (except in compliance with all Environmental Laws pertaining
thereto), dispose of, release or allow the release of any Hazardous Materials on
the Property;
(iii) neither directly nor indirectly transport or arrange for the
transport of any Hazardous Materials (except in compliance with all
Environmental Laws pertaining thereto); and
(iv) upon the request of the Collateral Agent, if the Collateral Agent has
reason to believe that Hazardous Materials are stored, released or disposed of
on the Property, take all reasonable action (including, without limitation, the
conducting of reasonably scoped environmental assessments at the sole expense of
the Grantor in accordance with subparagraph (c) hereof) to confirm that no
Hazardous Materials are stored, released or disposed of on the Property.
(iii) Environmental Indemnity. Grantor covenants and agrees, at Grantor's
sole cost and expense, to indemnify, defend (at trial and appellate levels, and
with attorneys, consultants and experts reasonably acceptable to the Collateral
Agent) and hold each Indemnitee harmless from and against any and all Liens,
damages, losses, liabilities, obligations, settlement payments, penalties,
assessments, citations, directives, claims, litigation, demands, defenses,
judgments, suits, proceedings, costs, disbursements or expenses of any kind or
of any nature whatsoever with respect to any Environmental Liability in
accordance with Section 9.3(b) of the Credit Agreement, including, without
limitation (i) the costs of assessment, containment and/or removal of any and
all Hazardous
8
Materials from all or any portion of the Property as required by law, (ii) the
costs of any actions taken as required by law in response to a release of any
Hazardous Materials on, in, under or affecting all or any portion of the
Property in order to prevent or minimize such release so that it does not
migrate to adjacent properties or cause or threaten significant risk to present
or future public health, safety, welfare or the environment. Indemnitees' rights
under this Paragraph shall be in addition to all other rights of Indemnitees
under this Deed of Trust and the other Loan Documents and payments by Grantor
under this paragraph shall not reduce Grantor's obligations and liabilities
under any of the Loan Documents.
(iv) Notice to Collateral Agent. If Grantor receives any notice or obtains
knowledge of (i) any potential or known release of any Hazardous Materials at or
from the Property, notification of which must be given to any Governmental
Authority under any Environmental Law, or notification of which has, in fact,
been given to any Governmental Authority, or (ii) any complaint, order, citation
or notice with regard to air emissions, water discharges, or any other
environmental health or safety matter affecting Grantor or the Property (an
"Environmental Complaint") from any Person (including, without limitation, the
Environmental Protection Agency), then Grantor shall immediately notify the
Collateral Agent orally and in writing of said release or Environmental
Complaint. Upon such notification, the Collateral Agent may, at its election
without regard to whether an Event of Default has occurred, obtain one or more
reasonably scoped environmental assessments of the Property prepared by a
geohydrologist, an independent engineer or other qualified consultant or expert
approved by the Collateral Agent which evaluates or confirms (i) whether any
Hazardous Materials are present in the soil or water at or adjacent to the
Property, and (ii) whether the use and operation of the Property comply
materially with all Environmental Laws. Environmental assessments may include
detailed visual inspections of the Property, including, without limitation, any
and all storage areas, storage tanks, drains, dry wells and leaching areas, and
the taking of soil samples, surface water samples and ground water samples, as
well as such other investigations or analyses as are reasonably necessary or
appropriate for a determination of the compliance of the Property and the use
and operation thereof with all applicable Environmental Laws. All such
environmental assessments shall be at the cost and expense of the Grantor. To
the extent necessary to allow the Collateral Agent to obtain the environmental
assessments provided for herein, the Grantor agrees that the Collateral Agent
and the representatives and agents of the Collateral Agent shall have a right to
enter upon, visit and inspect the Property, provided that in no event shall the
Collateral Agent's exercise of this right unreasonably interfere with Grantor's
use and enjoyment of the Property.
(v) Survival, Assignability, and Transferability.
(i) The warranties, representations and indemnity set forth in this
Paragraph 6 shall survive the payment and performance of the Secured Obligations
and any exercise by Beneficiary of any remedies under this Deed of Trust,
including without limitation, any remedy in the nature of foreclosure, and
9
shall not merge with any deed given by Grantor to Beneficiary or any Secured
Party in lieu of foreclosure.
(ii) It is agreed and intended by Grantor and Beneficiary that the
warranties, representations and indemnity set forth above in this Paragraph 6
may be assigned or otherwise transferred by Beneficiary to its successors and
assigns and to any subsequent purchasers of all or any portion of the Property
by, through or under Beneficiary, without notice to Grantor and without any
further consent of Grantor. To the extent consent or any such assignment or
transfer is required by law, advance consent to any such assignment or transfer
is hereby given by Grantor in order to maximize the extent and effect of such
warranties, representations and indemnity given hereby.
7. Use of Property. Unless required by applicable law or unless the Collateral
Agent has otherwise consented thereto in writing, which consent shall not be
unreasonably withheld or delayed, (i) Grantor shall not allow changes in the
nature of the occupancy or use for which the Property was intended at the time
this Deed of Trust was executed, and (ii) Grantor shall not initiate a change in
the zoning classification of the Property or subject the Property to restrictive
or negative covenants. Grantor shall comply with, observe and perform all zoning
and other laws affecting the Property, all restrictive covenants affecting the
Property, and all licenses and permits affecting the Property, subject to the
Grantor's right to contest, provided such contest complies with terms of Section
5.5 of the Credit Agreement.
8. Protection of Beneficiary's Security. If Grantor fails to perform the
covenants and agreements contained in this Deed of Trust, or if any action or
proceeding is commenced which affects the Mortgaged Property or title thereto or
the interest of Beneficiary therein, including, but not limited to, eminent
domain, or code enforcement, then the Collateral Agent, at such Collateral
Agent's option, may make such appearances, disburse such sums and take such
action as the Collateral Agent deems necessary to protect Beneficiary's interest
herein, including, but not limited to, disbursement of attorneys' fees, payment,
contest or compromise of any Lien which is prior to the Lien of this Deed of
Trust, and entry upon the Property to make repairs. Any amounts disbursed by the
Collateral Agent pursuant to this Paragraph 8, with interest thereon, shall
become a portion of the Secured Obligations. Unless Grantor and such Beneficiary
agree to other terms of payment, such amounts shall be payable upon notice from
the Collateral Agent to Grantor requesting payment thereof and shall bear
interest from the date of disbursement at the default rate payable on Prime Rate
Loans (the "Default Rate") stated in the Credit Agreement unless collection from
Grantor of interest at such rate would be contrary to Applicable Law, in which
event such amounts shall bear interest at the highest rate which may be
collected from Grantor under Applicable Law. Grantor shall have the right to
prepay such amounts in whole or in part at any time. Nothing contained in this
Paragraph 8 shall require the Collateral Agent to incur any expense or do any
act.
10
9. Condemnation. If the Property or any portion thereof (the loss of which shall
have, in the sole judgment of the Collateral Agent, a material impact on the
use, operation or value of the Property) shall be damaged or taken through
condemnation (which term, when used in this Mortgage, shall include any damage
or taking by any Governmental Authority, quasi-governmental authority, any
Person having the power of condemnation, or any transfer by private sale in lieu
thereof), either temporarily or permanently, then the Collateral Agent shall
have the right to commence, appear in and prosecute any action or proceeding
relating to any condemnation or other taking of the Property and to settle or
compromise any claim in connection with such condemnation or other taking.
Grantor hereby irrevocably makes, constitutes and appoints the Collateral Agent
(and all officers, employees or agents designated by the Collateral Agent) to
commence, appear in and prosecute, in the Collateral Agent's name or Grantor's
name, any action or proceeding relating to any condemnation or other taking of
the Property and to settle or compromise any claim in connection with such
condemnation or other taking. The proceeds of any award or claim for damages,
direct or consequential, in connection with any condemnation, or other taking of
the Property, or part thereof, or for conveyances in lieu of condemnation, are
hereby assigned to Collateral Agent. Grantor authorizes Collateral Agent to
apply such awards, proceeds or damages, after the deduction of the Collateral
Agent's expenses incurred in the collection of such amounts, in the manner
provided in the Credit Agreement. Grantor agrees to execute such further
assignment of any awards, proceeds, damages or claims arising in connection with
such condemnation or injury that the Collateral Agent may require.
10. Grantor and Lien Not Released. From time to time, without affecting the
obligation of Grantor or Grantor's successors or assigns to pay the Secured
Obligations and to observe the covenants of Grantor contained in this Deed of
Trust and the other Loan Documents, and without affecting the guaranty of any
Person, for payment or performance of the Secured Obligations, and without
affecting the Lien or priority of Lien of this Deed of Trust on the Mortgaged
Property, the Collateral Agent may, at the Collateral Agent's option, without
giving notice to or obtaining the consent of Grantor, Grantor's successors or
assigns or of any Facility Guarantor, and without liability on any Secured
Party's part, but subject to the terms and conditions of the Credit Agreement,
grant extensions or postponements of the time for payment of the Secured
Obligations or any part thereof, release anyone liable on any of the Secured
Obligations, accept a renewal note or notes therefor, release from this Deed of
Trust any part of the Mortgaged Property, take or release other or additional
security, reconvey any part of the Mortgaged Property, consent to any map or
plat or subdivision of the Property, consent to the granting of any easement,
join in any extension or subordination agreement and agree in writing with
Grantor to modify the terms and conditions of any Loan Document. Grantor shall
pay such title insurance premiums and attorneys' fees as may be incurred, at the
Collateral Agent's option, for any such action if taken at Grantor's request.
11
11. Forbearance Not Waiver. Any forbearance by the Collateral Agent or any other
Secured Party in exercising any right or remedy hereunder, or otherwise afforded
by Applicable Law, shall not be a waiver of or preclude the exercise of any
right or remedy hereunder. The procurement of insurance or the payment of taxes
or other Liens by the Collateral Agent shall not be a waiver of the Collateral
Agent's right to accelerate the maturity of the Secured Obligations. The
Collateral Agent's receipt of any awards, proceeds or damages under Paragraphs 3
and 9 hereof shall not operate to cure or waive Grantor's default in payment of
the Secured Obligations.
12. Property Leases and Revenues.
(a) As part of the consideration for the Secured Obligations, Grantor has
absolutely and unconditionally assigned and transferred to Beneficiary for the
ratable benefit of the Secured Parties all of Grantor's right, title and
interest in and to the Property Leases and the Revenues, including those now
due, past due or to become due by virtue of any Property Lease for the occupancy
or use of all or any part of the Property. Grantor hereby represents and
warrants as follows:
(i) Grantor is the sole and absolute owner of the entire landlord's or
lessor's interest in the Property Leases and said rents, issues and profits
and shall not assign its interest in, to or under any of the Property
Leases or the Revenues to any person or entity other than the Beneficiary;
(ii) Grantor has made no prior assignment of any of the Property
Leases or with respect to any of said rents, issues or profits; and
(iii) Grantor has neither done any act nor omitted to do any act which
might prevent Beneficiary from, or limit Beneficiary in, acting under any
of the provisions of this assignment pursuant to this Deed of Trust.
(b) Grantor agrees that neither the foregoing assignment of Property Leases
and Revenues, nor the exercise of any of Beneficiary's rights and remedies under
Paragraph 17 hereof shall be deemed to make Beneficiary a
mortgagee-in-possession or otherwise responsible or liable in any manner with
respect to the Property Leases, the Property or the use, occupancy, enjoyment or
operation of all or any portion thereof, unless and until Beneficiary, in person
or by agent, assumes actual possession thereof. Nor shall the appointment of any
receiver for the Property by any court at the request of Beneficiary or by
agreement with Grantor, or the entering into possession of any part of the
Property by such receiver, be deemed to make Beneficiary a
mortgagee-in-possession or otherwise responsible or liable in any manner with
respect to the Property Leases, the Property or the use, occupancy, enjoyment or
operation of all or any portion thereof.
(c) If Beneficiary or a receiver enters upon, takes possession of and
maintains control of the Property, all Revenues thereafter collected shall be
12
applied first to the costs of taking control of and managing the Property and
collecting the Revenues, including, but not limited to, reasonable attorneys'
fees actually incurred, receiver's fees, premiums on receiver's bonds, costs of
repairs to the Property, premiums on insurance policies, Impositions and other
charges on the Property, and the costs of discharging any obligation or
liability of Grantor as landlord, lessor or licensor of the Property and then to
the Secured Obligations, in the manner set forth in the Credit Agreement. The
Collateral Agent and/or the receiver shall have access to the books and records
used in the operation and maintenance of the Property and shall be liable to
account only for those Revenues actually received. Beneficiary shall not be
liable to Grantor, anyone claiming under or through Grantor or anyone having an
interest in the Property by reason of anything done or left undone by
Beneficiary pursuant to Paragraph 17 hereof. If the Revenues are not sufficient
to meet the costs of taking control of and managing the Property and collecting
the Revenues, any monies expended by Beneficiary for such purposes shall become
a portion of the Secured Obligations. Unless Beneficiary and Grantor agree in
writing to other terms of payment, such amounts shall be payable upon notice
from Beneficiary to Grantor requesting payment thereof and shall bear interest
from the date of disbursement at the Default Rate, unless payment of interest at
such rate would be contrary to applicable law, in which event such amounts shall
bear interest at the highest rate which may be collected from Grantor under
Applicable Law. The entering upon and taking possession of and maintaining of
control of the Property by Beneficiary or the receiver pursuant to the
provisions of this Deed of Trust and the application of Revenues as provided
herein shall not cure or waive any Event of Default or invalidate any other
right or remedy of Beneficiary hereunder.
(d) At the Beneficiary's request, the Grantor shall enter into a
Subordination, Nondisturbance and Attornment Agreement in form and substance
reasonably acceptable to Beneficiary with respect to all Property Leases with
tenants of the Property which are not Affiliates of the Grantor.
13. Property Leases and Collection of Revenues. Grantor will not, without the
consent of the Collateral Agent in writing, which consent shall not be
unreasonably withheld or delayed, enter into any Property Lease of all or any
portion of the Property or amend, supplement or otherwise modify, or terminate
or cancel, or accept the surrender of, or consent to the assignment or
subletting of, or grant any concessions to or waive the performance of any
obligations of any tenant, lessee or licensee under, any now existing or future
Property Lease. Grantor agrees not to collect or accept the payment of any
Revenues, or other income or profit from, or on account of, any use or occupancy
of the Property, in advance of the time when such payment becomes due unless
such amount is delivered to Beneficiary to be applied to the Secured
Obligations, in the manner set forth in the Credit Agreement.
14. Remedies Cumulative. All remedies provided in this Deed of Trust are
distinct and cumulative to any other right or remedy under this Deed of Trust or
13
under the other Loan Documents or afforded by law or equity, and may be
exercised concurrently, independently or successively.
15. Taxation of Deeds of Trust. In the event of the enactment of any law
deducting from the value of the Property any mortgage Lien thereon, or imposing
upon Beneficiary the payment of all or part of the taxes, charges or assessments
previously paid by Grantor pursuant to this Deed of Trust, or changing the law
relating to the taxation of mortgages or debts secured by mortgages or
Beneficiary's interest in the Property so as to impose new incidents of tax on
Beneficiary, then Grantor shall pay such taxes or assessments or shall reimburse
Beneficiary therefor.
16. Events of Default and Acceleration. The occurrence of any "Event of Default"
as defined in the Credit Agreement shall constitute an Event of Default
hereunder. If an Event of Default shall have occurred and be continuing, the
Secured Obligations may be accelerated pursuant to the terms of the Credit
Agreement, whereupon the same shall become immediately due and payable, and
without presentment, protest, demand or other notice of any kind, all of which
are hereby expressly waived by Grantor. No omission to exercise such option when
entitled to do so shall be construed as a waiver of such right.
17. Rights and Remedies.
(a) Foreclosure and other Remedies. Upon the occurrence and during the
continuation of any Event of Default, and whether or not Beneficiary shall have
accelerated the maturity of the Secured Obligations pursuant to Paragraph 16
hereof, Trustee, at its option, may:
(i) exercise the rights and remedies afforded under Paragraph 17(b) below,
or exercise any of the following remedies to the extent available under the laws
of the State of Texas;
(ii) either with or without entering upon or taking possession of the
Property, demand, collect and receive any or all Revenues;
(iii) either with or without entering upon or taking possession of the
Property, and without assuming any obligations of Grantor thereunder, exercise
the rights of Grantor under, use or benefit from, any of the Property Leases;
(iv) in person, by agent or by court-appointed receiver, enter upon, take
possession of, and maintain full control of the Mortgaged Property in order to
perform all acts necessary or appropriate to maintain and operate the Mortgaged
Property, including, but not limited to, the execution, cancellation or
modification of Property Leases, the making of repairs to the Property and the
execution or termination of contracts
14
providing for the management or maintenance of the Property, all on such terms
as Trustee, in its sole discretion, deems proper or appropriate;
(v) proceed by a suit or suits in law or in equity or by other appropriate
proceeding to enforce payment of the Secured Obligations or the performance of
any term, covenant, condition or agreement of this Deed of Trust or the Credit
Agreement or any of the other Loan Documents, or any other right, and to pursue
any other remedy available to it, all as Trustee shall determine most effectual
for such purposes;
(vi) institute and maintain such suits and proceedings as Trustee may deem
expedient to prevent any impairment of the Mortgaged Property by any acts which
may be unlawful or in violation of this Deed of Trust, to preserve or protects
its interest in the Mortgaged Property and the Revenues, and to restrain the
enforcement of or compliance with any legislation or other governmental
enactment, rule or order that would impair the security hereunder or be
prejudicial to the interest of Trustee;
(vii) apply all or any portion of the Mortgaged Property, or the proceeds
thereof, towards (but not necessarily in complete satisfaction of) the Secured
Obligations, in the manner set forth in the Credit Agreement or the Security
Agreement, as applicable;
(viii) foreclose any and all rights of Grantor in and to the Property,
whether by sale, entry or in any other manner provided for hereunder or under
the laws of the State of Texas;
(ix) in the case of any receivership, insolvency, bankruptcy,
reorganization, arrangement, adjustment, composition or other proceedings
affecting Grantor or the creditors or property of Grantor, Beneficiary, to the
extent permitted by law, shall be entitled to file such proofs of claim and
other documents as may be necessary or advisable in order to have the claims of
Beneficiary allowed in such proceedings for the entire amount of the Secured
Obligations at the date of the institution of such proceedings and for any
additional portion of the Secured Obligations accruing after such date;
(x) exercise any other right or remedy of a mortgagee or secured party
under the laws of the State of Texas.
(b) Rights of Beneficiary and Trustee.
i. Upon the occurrence of an Event of Default, it shall thereupon, or at any
time thereafter while any part of the Secured Obligations remain undischarged,
be the duty of the Trustee, or his successors, as hereinafter provided, at the
request of Beneficiary (which request shall be presumed), to enforce this Trust
and to sell the Property, as
15
an entirety or in parcels, by one sale or by several sales, held at one time or
at different times, all as the Trustee acting may elect, each sale to be held in
the area of the county courthouse designated for the conduct of foreclosure
sales in any county in which a part of the real property to be sold is situated
and to be made on the first Tuesday of some month between the hours of 10
o'clock a.m. and 4 o'clock p.m. to the highest bidder for cash at public venue,
after the Trustee and Beneficiary shall have given notices of the proposed sale
in the manner hereinafter set forth, and to make due conveyance to the purchaser
or purchasers, with general warranty of title to such purchaser or purchasers
binding upon Grantor and its successors. Grantor, for itself and assigns, hereby
expressly and specifically waives all rights to a marshalling of the assets of
Grantor, including the Property, or to a sale in inverse order of alienation.
ii. The Trustee shall give notice of each such proposed sale by posting written
notice of the time, place and terms of sale at the courthouse door, and by
filing a copy of such written notice in the office of the county in which the
sale is to be made, at least twenty one (21) consecutive days preceding the date
of the sale. Where real properties to be sold are situated in more than one
county, one notice shall be posted at the courthouse door, and a copy of such
notice shall be filed with the county clerk, of each county, in which a part of
the real properties to be sold is situated, and such notices shall designate the
county where such real properties will be sold, which may be any county in which
a part of said real properties is situated. In addition to the foregoing notice
or notices to be posted and filed by the Trustee, the mortgage servicer of the
debt to which the power of sale is related (the "Mortgage Servicer") shall, at
least twenty one (21) days preceding the date of sale, serve or cause to be
served written notice of the proposed sale by certified mail on each debtor
obligated to pay such debt according to the records of such Mortgage Servicer.
The service of such notice shall be completed upon deposit of the notice,
enclosed in a prepaid wrapper, properly addressed to each such debtor at the
last known address, in a post office or official depository under the care and
custody of the United States Postal Service. The affidavit of any person having
knowledge of the facts to the effect that such service was completed shall be
prima facie evidence of the fact of service. In this respect and to the full
extent permitted by law, Grantor also expressly covenants, stipulates and agrees
16
that: (i) the address of Grantor set forth on the first page of this Deed of
Trust shall be deemed and considered conclusively to be and remain at all times
that last known address of all debtors obligated to pay such debt as shown by
the records of the Mortgage Servicer, provided such address may be changed from
time to time only by express written notice of change thereof signed by all
debtors obligated to pay such debt and actually delivered to and received by
Mortgage Servicer and setting forth a new address which shall be within the
United States of America and which shall be deemed and considered conclusively
to be and remain at all times thereafter the most recent address of all debtors
obligated to pay such debt as shown by the records of Mortgage Servicer until
changed in the manner herein provided, (ii) the records of Mortgage Servicer
shall not be deemed to reflect any change in the name or identity of the debtors
obligated to pay the debt (to whom notice of a proposed sale shall be required
to be mailed as provided for above) unless and until express written notice of
such change signed by all debtors obligated to pay such debt shall have been
actually delivered to and received by Mortgage Servicer, and (iii) no notice of
such sale or sales other than the notices hereinabove provided shall be required
to be given to Grantor or any other persons and any other notice is expressly
waived.
iii. The provisions of Subparagraph 17(b)ii above with respect to posting,
serving, filing and giving notices of sale are intended to comply with the
provisions of Section 51.002 of the Property Code of the State of Texas as in
effect on the date hereof (the "Subject Statutes"). In the event the requirement
for any notice, or the posting, serving, filing or giving thereof, under the
Subject Statutes shall be eliminated or the prescribed manner of posting,
serving, filing or giving same is modified by future amendment to the Subject
Statutes, the requirement for such particular notice shall be stricken from, or
the manner of posting, serving, filing or giving any notice hereunder modified
in, this instrument in conformity with such amendment. The manner herein
prescribed for posting, serving, filing or giving any notice, other than that to
be posted and filed or caused to be posted and filed by the Trustee, shall not
be deemed exclusive but such notice or notices may be posted, served, filed or
given in any other manner which may be permitted by applicable law. Further, in
relation to this Deed of Trust and the exercise of any power of sale by the
Trustee hereunder, if either the Subject Statutes shall be
17
amended or modified to require any other notice of the posting, filing, serving
or giving thereof or any statute hereafter enacted shall require any other
notice or the posting, filing, serving or giving thereof, the Trustee or the
person selected by him is hereby authorized and empowered by Grantor to give
such notice provided, however, Grantor waives such other notice or the posting,
filing, serving or giving thereof to the full extent Grantor may lawfully so do.
iv. At any sale conducted under this instrument, credit upon all or any part of
the Secured Obligations shall be deemed cash paid for the purpose of
Subparagraph 17(b)i above; and the holder of all or any part of the Secured
Obligations may purchase at any such sale. With the proceeds arising from such
sale or sales, the Trustee shall first pay all expenses of advertising, sale and
conveyance, including a reasonable Trustee's fee (not to exceed five percent
(5%) of the gross proceeds of such sale or sales) to the Trustee acting, and
shall next apply such proceeds toward the discharge and payment of the Secured
Obligations (including principal, interest and attorney's fees, if any), and the
remaining balance, if any, shall be paid to Grantor.
v. Without limiting any of the powers or remedies provided elsewhere, Grantor
agrees that in the event the Secured Obligations are payable in installments or
include, at any time, items of matured as well as unmatured indebtedness, the
holder of the matured installments or items of indebtedness, as the case may be,
shall have the right to have the Property sold subject to the part of the
Secured Obligations which is unmatured at the time the Trustee is requested to
make such sale, at Trustee's sale to satisfy the lien and security interest
hereof securing the then matured portion of said indebtedness and the Trustee is
expressly authorized and empowered to conduct such sale which is called herein
an "Installment Foreclosure." Any Installment Foreclosure made hereunder shall
not affect the liens, assignments and security interest of this Deed of Trust
existing to secure that portion of the Secured Obligations to which the sale is
to be made subject. No Installment Foreclosure shall exhaust the power of the
Trustee to conduct future Installment Foreclosures nor in anywise limit the
powers of sale provided elsewhere in this Deed of Trust. The provisions
elsewhere in this Deed of Trust relating to manner of conducting Trustee's
sales, including the posting, filing and giving of notices thereof,
18
shall also apply to any Installment Foreclosure and the same presumptions shall
be applicable to any Trustee's deed or recital therein contained in connection
with an Installment Foreclosure and to any other affidavit as hereinafter
provided.
vi. In the case of the absence of the Trustee from the State of Texas, or of his
death, inability, refusal or failure to act, or in the event the Beneficiary
should elect at any time (with or without cause) to remove the Trustee then
acting, a successor or substitute may be named, constituted and appointed by the
Beneficiary, without further formality than an appointment and designation in
writing, which appointment and designation shall be full evidence of the right
and authority to make the same and of all facts therein recited; and this
conveyance shall vest in the Successor or Substitute Trustee the title, powers
and duties conferred on the Trustee named herein and the conveyance by the
Successor or Substitute Trustee to the purchaser at any sale made pursuant
hereto shall be valid and effective as fully as hereinabove provided in the case
of a conveyance by the Trustee. Such right to appoint a Successor or Substitute
Trustee shall exist as often as and whenever the Trustee, original, successor or
substitute, cannot or will not act or has been removed by Beneficiary. Grantor
specifically covenants and stipulates that: the recitals in the conveyance made
to the purchaser, either by the Trustee or any Successor or Substitute Trustee,
shall be full proof and evidence of the matters therein stated; no other proof
shall be requisite of the request by the holder of the Secured Obligations on
the Trustee or on any Successor or Substitute Trustee to enforce this trust, or
of the due, timely and proper posting, filing and giving of all notices and
making of the sale, or any particulars thereof, or of the in ability, refusal or
failure of the Trustee, or any Successor or Substitute Trustee, to act, or of
the removal of the Trustee or any Successor or Substitute Trustee, as herein
provided, either as to the legality of his appointment or otherwise, or of the
contingencies which brought about the failure or inability of the Trustee or any
Successor or Substitute Trustee to act, or of his removal, as the case may be;
all pre requisites of said sale shall be presumed to have been performed; and
any such sale made under the powers herein granted shall be a perpetual bar
against Grantor, its successors and assigns.
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vii. The right of sale hereunder shall not be exhausted by one or any sale, but
so long as any of the Secured Obligations remain undischarged, the Trustee or
successor or Substitute Trustee may make other and successive sales until all
the Property shall be legally sold.
viii. The Beneficiary shall have the power and authority to institute and
maintain any suits and proceedings as the Beneficiary may deem advisable (i) to
prevent any impairment of the Property by any acts which may be unlawful or any
violation of this Deed of Trust, (ii) to preserve or protect its interest in the
Property, and (iii) to restrain the enforcement of or compliance with any
legislation or other governmental enactment, rule or order that may be
unconstitutional or order that may be unconstitutional or otherwise invalid, if
the enforcement of or compliance with such enactment, rule or order might impair
the security hereunder or be prejudicial to the Beneficiary's interest.
ix. In the case of any receivership, insolvency, bankruptcy, reorganization,
arrangement, adjustment, composition, or other judicial proceedings affecting
the Grantor or any guarantor, co maker or endorser of any of the Grantor's
obligations, its creditors or its property, the Beneficiary, to the extent
permitted by law, shall be entitled to file such proofs of claim and other
documents as may be necessary or advisable in order to have its claims allowed
in such proceedings for the entire amount due and payable by the Grantor under
the Notes, this Deed of Trust and any other instrument securing the Notes, at
the date of the institution of such proceedings, and for any additional amounts
which may become due and payable by the Grantor after such date.
x. In case of a foreclosure sale of all or any part of the Property and of the
application of the proceeds of sale to the payment of the sums secured hereby,
the Beneficiary shall, unless precluded under the Notes from seeking a
deficiency judgment against the Grantor, be entitled to enforce payment from the
Grantor of all amounts then remaining due and unpaid and to recover judgment
against the Grantor for any portion thereof remaining unpaid, with interest.
(c) Receiver. If an Event of Default shall have occurred Beneficiary, upon
application to a court of competent jurisdiction, shall be entitled as a matter
20
of strict right without notice and without regard to the occupancy or value of
any security for the Secured Obligations or the solvency of any party bound for
its payment, to the appointment of a receiver to take possession of the
Mortgaged Property and to operate the Property and to collect and apply the
Revenues. The receiver shall have all of the rights and powers permitted under
the laws of the State of Texas. Grantor will pay to Beneficiary upon demand, all
expenses, including receiver's fees, attorneys' fees, costs and agent's
compensation, incurred pursuant to such appointment and all such expenses shall
be a portion of the Secured Obligations.
(d) Sale or Other Disposition of Mortgaged Property. Grantor waives any
right to require the marshaling of any of its assets in connection with any
disposition conducted pursuant hereto. In the event all or part of the Mortgaged
Property is included at any foreclosure sale conducted pursuant hereto, a single
total price for the Mortgaged Property, or such part thereof as is sold, may be
accepted by Beneficiary with no obligation to distinguish between the
application of such proceeds amongst the property comprising the Mortgaged
Property.
(e) Collection of Revenues. In connection with the exercise by Beneficiary
of the rights and remedies provided for in subparagraph (a)(ii) of this
Paragraph 17:
(i) Beneficiary may notify any tenant, lessee or licensee of the Property,
either in the name of Beneficiary or Grantor, to make payment of Revenues
directly to Beneficiary or Beneficiary's agents, may advise any person of
Beneficiary's interest in and to the Revenues, and may collect directly from
such tenants, lessees and licensees all amounts due on account of the Revenues;
(ii) At Beneficiary's request, Grantor will provide written notification to any
or all tenants, lessees and licensees of the Property concerning Beneficiary's
interest in the Revenues and will request that such tenants, lessees and
licensees forward payment thereof directly to Beneficiary;
(iii) Grantor shall hold any proceeds and collections of any of the Revenues in
trust for Beneficiary and shall not commingle such proceeds or collections with
any other funds of Grantor; and
(iv) Grantor shall deliver all such proceeds to Beneficiary immediately upon the
receipt thereof by Grantor in the identical form received, but duly endorsed or
assigned on behalf of Grantor to Beneficiary.
(f) Use and Occupation of Property. In connection with the exercise of the
Beneficiary's rights under Subparagraph (a)(v) of this Paragraph 17, Beneficiary
may enter upon, occupy, and use all or any part of the Property and
21
may exclude Grantor from the Land and the Improvements or portion thereof as may
have been so entered upon, occupied, or used. In the event Beneficiary manages
the Land and the Improvements in accordance with Subparagraph (a)(vi) herein,
Grantor shall pay to Beneficiary on demand a reasonable fee for the management
thereof in addition to the Secured Obligations. Further, Beneficiary may make
such alterations, renovations, repairs, and replacements to the Improvements, as
Beneficiary, in its sole discretion, deems proper or appropriate. The obligation
of Grantor to pay such amounts and all expenses incurred by Beneficiary in the
exercise of its rights hereunder shall be included in the Secured Obligations
and shall accrue interest at the Default Rate, unless collection from Grantor of
interest at such rate would be contrary to applicable law, in which event such
amounts shall bear interest at the highest rate which may be collected from
Grantor under applicable law.
(g) Partial Sales. Grantor agrees that in case Beneficiary, in the exercise
of the power of sale contained herein or in the exercise of any other rights
hereunder given, elects to sell in parts or parcels, said sales may be held from
time to time and that the power shall not be exhausted until all of the
Mortgaged Property not previously sold shall have been sold, notwithstanding
that the proceeds of such sales exceed, or may exceed, the Secured Obligations.
(h) Assembly of Mortgaged Property. Upon the occurrence of any Event of
Default, Beneficiary may require Grantor to assemble that portion of the
Mortgaged Property consisting of personal property and make it available to
Beneficiary, at Grantor's sole risk and expense, at a place or places to be
designated by Beneficiary which are reasonably convenient to both Beneficiary
and Grantor.
(i) Power of Attorney. Grantor hereby irrevocably constitutes and appoints
Beneficiary as Grantor's true and lawful attorney in fact, exercisable only
after the occurrence of and during the continuance of an Event of Default, to
take any action with respect to the Mortgaged Property to preserve, protect, or
realize upon Beneficiary's interest therein, each at the sole risk, cost and
expense of Grantor, but for the sole benefit of Beneficiary. The rights and
powers granted Beneficiary by the within appointment include, but are not
limited to, the right and power to: (i) prosecute, defend, compromise, settle,
or release any action relating to the Mortgaged Property; (ii) endorse the name
of Grantor in favor of Beneficiary upon any and all checks or other items
constituting Revenues; (iii) enter into leases or subleases relative to all or a
portion of the Land or the Improvements; (iv) enter into any contracts or
agreements relative to, and to take all action deemed necessary in connection
with, the construction of any Improvements on the Land; (v) manage, operate,
maintain, or repair the Land and the Improvements pursuant to Contracts or
otherwise; and (vi) exercise the rights of Grantor under any Property Leases or
any Contracts. Beneficiary shall not be obligated to perform any of such acts or
to exercise any of such powers, but if Beneficiary elects so to perform or
exercise, Beneficiary shall not be accountable for more than it actually
receives as a result of such exercise of power, and shall
22
not be responsible to Grantor except for Beneficiary's willful misconduct, gross
negligence or bad faith, as determined by a court of competent jurisdiction by
final and nonappealable judgment. All powers conferred upon Beneficiary by this
Deed of Trust (which shall only be exercised only after the occurrence of and
during the continuance of an Event of Default), being coupled with an interest,
shall be irrevocable until terminated by a written instrument executed by a duly
authorized officer of Beneficiary.
18. Notices. Any and all notices, demands, elections or requests provided
for or permitted to be given pursuant to this Deed of Trust shall be given or
served as provided in Section 9.1 of the Credit Agreement.
19. Successors and Assigns Bound; Captions. The covenants and agreements
herein contained shall bind, and the rights hereunder shall inure to, the
respective successors and assigns of Beneficiary and Grantor, subject to the
provisions of Paragraph 6 hereof. The captions and headings of the paragraphs of
this Deed of Trust are for convenience only and are not to be used to interpret
or define the provisions hereof.
20. Governing Law; Severability. This Deed of Trust and the obligations of
Grantor hereunder shall be governed by and interpreted and determined in
accordance with the laws of the State of New York except that the creation,
governance, administration and enforcement of Liens and rights and remedies with
respect to the Property shall be governed by and interpreted in accordance with
the laws of the State of Texas. In the event that any provision or clause of
this Deed of Trust or any other Loan Document conflicts with Applicable Law,
such conflict shall not affect other provisions of this Deed of Trust or such
Loan Document which can be given effect without the conflicting provision, and
to this end, the provisions of this Deed of Trust and the other Loan Documents
are declared to be severable. In the event that any Applicable Law limiting the
amount of interest or other charges permitted to be collected from Grantor is
interpreted by a court of competent jurisdiction in a final order so that any
charge for which provision is made in this Deed of Trust or in the other Loan
Documents, whether considered separately or together with other charges
permitted to be collected from Grantor, is interpreted so that any such charge,
whether considered separately or together with other charges that are considered
a part of the transaction represented by this Deed of Trust and the other Loan
Documents, violates such law, and Grantor is entitled to the benefit of such
law, such charge is hereby reduced to the extent necessary to eliminate such
violation. The amounts, if any, previously paid to Beneficiary in excess of the
amounts payable to Beneficiary pursuant to such charges as reduced shall be
applied by Beneficiary to reduce the principal of the Secured Obligations.
21. Discharge. This Agreement shall terminate and the Beneficiary shall
discharge this Deed of Trust when all the Secured Obligations have been
indefeasibly paid in full, the Lenders have no further commitment to lend, there
are no Letter of Credit Outstandings and the Issuing Banks have no further
23
commitment to issue Letters of Credit under the Credit Agreement. Grantor shall
pay Beneficiary's reasonable costs incurred in discharging this Deed of Trust.
22. Waivers. (i) Grantor agrees to the full extent permitted by law, that
in case of an Event of Default hereunder, neither Grantor nor anyone claiming
through or under Grantor shall or will set up, claim or seek to take advantage
of any appraisement, valuation, stay, extension, homestead, exemption or
redemption laws now or hereafter in force, in order to prevent or hinder the
enforcement or foreclosure of this Deed of Trust, or the absolute sale of the
Mortgaged Property, or the final and absolute putting into possession thereof,
immediately after such sale, of the purchasers thereat, and Grantor, for Grantor
and all who may at any time claim through or under Grantor, hereby waives to the
fullest extent that Grantor may lawfully so do, the benefit of all such laws,
and any and all right to have the assets comprised in the security intended to
be created hereby marshaled upon any foreclosure of the Lien hereof.
(ii) No failure or delay of the Collateral Agent in exercising any power or
right hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such a right or power, preclude any other or
further exercise thereof or the exercise of any other right or power. The rights
and remedies of the Beneficiary hereunder are cumulative and are not exclusive
of any rights or remedies that the Beneficiary would otherwise have. No waiver
of any provisions of this Agreement or any other Loan Document or consent to any
departure by Grantor therefrom shall in any event be effective unless the same
shall be permitted by paragraph (c) below, and then such waiver or consent shall
be effective only in the specific instance and for the purpose for which given.
No notice to or demand on the Grantor in any case shall entitle the Grantor to
any other or further notice or demand in similar or other circumstances.
(iii) Neither this Deed of Trust nor any provision hereof may be waived,
amended or modified except pursuant to an agreement or agreements in writing
entered into by the Beneficiary and the Grantor with respect to which such
waiver, amendment or modification is to apply, subject to any consent required
in accordance with Section 9.2 of the Credit Agreement.
(iv) In the event of the sale or transfer by operation of law or otherwise
of all or any part of the Mortgaged Property, Beneficiary, without notice, is
hereby authorized and empowered to deal with any such vendee or transferee with
reference to the Mortgaged Property or the Secured Obligations or with reference
to any of the terms, covenants, conditions or agreements hereof, as fully and to
the same extent as it might deal with the original parties hereto and without in
any way releasing or discharging any liabilities, obligations or undertakings
(including, without limitation, the restrictions upon transfer contained in
Paragraph 5).
24
(v) In the event an interest in any of the Property is foreclosed upon
pursuant to a judicial or nonjudicial foreclosure sale, Grantor agrees as
follows: notwithstanding the provisions of Sections 51.003, 51.004, and 51.005
of the Texas Property Code (as the same may be amended from time to time), and
to the extent permitted by law, Grantor agrees that Beneficiary shall be
entitled to seek a deficiency judgment from Grantor and any other party
obligated on the Credit Extensions equal to the difference between the amount
owing on the Credit Extensions and the amount for which the Mortgaged Property
was sold pursuant to judicial or nonjudicial foreclosure sale. Grantor expressly
recognizes that this section constitutes a waiver of the above-cited provisions
of the Texas Property Code which would otherwise permit Grantor and other
Persons against whom recovery of deficiencies is sought or Grantor independently
(even absent the initiation of deficiency proceedings against them) to present
competent evidence of the fair market value of the Mortgaged Property as of the
date of the foreclosure sale and offset against and deficiency the amount by
which the foreclosure sale price is determined to be less than such fair market
value. Grantor further recognizes and agrees that this waiver creates an
irrebuttable presumption that the foreclosure sale price is equal to the fair
market value of the Property for purposes of calculating deficiencies owed by
Grantor, Guarantor, and others against whom recovery of a deficiency is sought.
(vi) Neither Beneficiary nor any affiliate of Beneficiary has made any
representation, warranty or statement to Grantor in order to induce Grantor to
execute this Deed of Trust. Grantor hereby expressly waives any claim of
fraudulent inducement to execute this Deed of Trust and further disclaims any
reliance or statements on or representations of Beneficiary in waiving such
claim.
23. Further Assurances. At any time and from time to time, upon request by
the Collateral Agent, Grantor will make, execute and deliver, or cause to be
made, executed and delivered, to the Collateral Agent and, where appropriate,
cause to be recorded and/or filed and from time to time thereafter to be
re-recorded and/or refiled at such time and in such offices and places as shall
be deemed desirable by the Collateral Agent, any and all such other and further
assignments, mortgages, security agreements, financing statements, continuation
statements, instruments of further assurance, certificates and other documents
as may, in the opinion of the Collateral Agent, be necessary or desirable in
order to effectuate, complete, or perfect, or to continue and preserve (a) the
obligations of Grantor under this Deed of Trust, and (b) the Lien created by
this Deed of Trust upon the Mortgaged Property. Upon any failure by Grantor so
to do, Beneficiary may make, execute, record, file, re-record and/or refile any
and all such assignments, mortgages, security agreements, financing statements,
continuation statements, instruments, certificates, and documents for and in the
name of Grantor, and Grantor hereby irrevocably appoints Beneficiary the agent
and attorney in fact of Grantor so to do.
25
24. Subrogation. Beneficiary shall be subrogated to all right, title, Lien
or equity of all persons to whom Beneficiary may have paid any monies in
settlement of Liens or in acquisition of title or for its benefit hereunder, or
for the benefit or account of Grantor or subsequently paid under any provisions
hereof.
25. Time of the Essence. Time is of the essence with respect to each and
every covenant, agreement and obligation of Grantor under this Deed of Trust and
any and all other Loan Documents.
26. Beneficiary's Fees and Expenses; Indemnification. (a) Without in anyway
limiting any other reimbursement obligations contained under the other Loan
Documents, the Grantor agrees to pay upon demand to the Beneficiary the amount
of any and all reasonable expenses, including the reasonable fees, disbursements
and other charges of its counsel and of any experts or agents, which the
Beneficiary may incur in connection with the exercise, enforcement or protection
of any of the rights of the Beneficiary hereunder.
(b) Without limitation of its indemnification obligations under the other
Loan Documents, the Grantor agrees to indemnify the Beneficiary and the other
Indemnitees against, and hold each of them harmless from, any and all losses,
claims, damages, liabilities and related expenses, including reasonable fees,
disbursements and other charges of counsel, incurred by or asserted against any
of them arising out of, in any way connected with, or as a result of, the
execution, delivery or performance of this Deed of Trust or any claim,
litigation, investigation or proceeding relating hereto or to the Mortgaged
Property, whether or not any Indemnitee is a party thereto; provided that such
indemnity shall not, as to any Indemnitee, be available to the extent that such
losses, claims, damages, liabilities or related expenses are determined by a
court of competent jurisdiction by final and nonappealable judgment to have
resulted from the gross negligence, bad faith, or willful misconduct of such
Indemnitee.
(c) Any such amounts payable as provided hereunder shall be additional
Secured Obligations secured hereby and by the other Security Documents. The
provisions of this Paragraph 26 shall remain operative and in full force and
effect regardless of the termination of this Deed of Trust or any other Loan
Document, the consummation of the transactions contemplated hereby, the
repayment of any of the Secured Obligations, the invalidity or unenforceability
of any term or provision of this Deed of Trust or any other Loan Document, or
any investigation made by or on behalf of the Beneficiary or any Secured Party.
All amounts due under this Paragraph 26 shall be payable on written demand
therefor.
27. Submission to Jurisdiction. GRANTOR AGREES THAT ANY SUIT FOR THE
ENFORCEMENT OF THIS DEED OF TRUST MAY BE BROUGHT IN THE COURTS OF THE STATE OF
NEW YORK SITTING IN THE BOROUGH OF MANHATTAN OR ANY FEDERAL COURT SITTING
THEREIN AS THE BENEFICIARY MAY ELECT IN ITS SOLE
26
DISCRETION AND CONSENTS TO THE NON-EXCLUSIVE JURISDICTION OF SUCH COURTS.
GRANTOR AND BENEFICIARY (BY ITS ACCEPTANCE OF THIS DEED OF TRUST) EACH HEREBY
WAIVES ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH
SUIT OR ANY SUCH COURT OR THAT SUCH SUIT IS BROUGHT IN AN INCONVENIENT FORUM AND
AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE
CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR
IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS DEED OF TRUST OR ANY OTHER
LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT BENEFICIARY MAY OTHERWISE HAVE TO
BRING ANY ACTION OR PROCEEDING RELATING TO THIS DEED OF TRUST AGAINST
BENEFICIARY OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.
GRANTOR AGREES THAT ANY ACTION COMMENCED BY GRANTOR ASSERTING ANY CLAIM OR
COUNTERCLAIM ARISING UNDER OR IN CONNECTION WITH THIS DEED OF TRUST OR ANY OTHER
LOAN DOCUMENT SHALL BE BROUGHT SOLELY IN A COURT OF THE STATE OF NEW YORK
SITTING IN THE BOROUGH OF MANHATTAN OR ANY FEDERAL COURT SITTING THEREIN AS THE
BENEFICIARY MAY ELECT IN ITS SOLE DISCRETION AND CONSENTS TO THE EXCLUSIVE
JURISDICTION OF SUCH COURTS WITH RESPECT TO ANY SUCH ACTION.
GRANTOR AND BENEFICIARY (BY ITS ACCEPTANCE OF THIS DEED OF TRUST) IRREVOCABLY
CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 9.1
OF THE CREDIT AGREEMENT. NOTHING IN THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT
WILL AFFECT THE RIGHT OF GRANTOR AND BENEFICIARY TO SERVE PROCESS IN ANY OTHER
MANNER PERMITTED BY LAW.
28. WAIVER OF JURY TRIAL. GRANTOR AND BENEFICIARY (BY ITS ACCEPTANCE OF
THIS DEED OF TRUST) EACH HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY RIGHT TO A JURY IN ANY TRIAL OF ANY CASE OR CONTROVERSY
(WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY) IN WHICH ANY SUCH PERSON
IS OR BECOMES A PARTY (WHETHER SUCH CASE OR CONTROVERSY IS INITIATED BY OR
AGAINST ANY SUCH PERSON OR IN WHICH ANY SUCH PERSON IS JOINED AS A PARTY
LITIGANT), WHICH CASE OR CONTROVERSY ARISES OUT OF OR IS IN RESPECT OF, ANY
RELATIONSHIP AMONGST OR BETWEEN ANY LOAN PARTY OR ANY OTHER PERSON AND ANY
SECURED PARTY OR PARTICIPANT OR THE ACTIONS OF ANY SECURED PARTY IN THE
NEGOTIATION,
27
ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF. EACH OF GRANTOR AND
BENEFICIARY (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER
PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT,
IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, AND (B)
ACKNOWLEDGES THAT IT AND THE OTHER PARTY HAVE BEEN INDUCED TO ENTER INTO THIS
DEED OF TRUST BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN
THIS PARAGRAPH 28.
29. Choice of Law. This Deed of Trust and each of the other Loan Documents
shall in all respects be governed, construed, applied and enforced in accordance
with the internal laws of the State of New York without regard to principles of
conflicts of law, except that matters relating to the creation, perfection,
priority and enforcement of the liens on and security interests in the Mortgaged
Property or other assets situated in Texas, including by way of illustration,
but not in limitation, actions for foreclosure, for injunctive relief, or for
the appointment of a receiver, shall be governed by the laws of the State of
Texas.
30. Future Advances. This Deed of Trust secures future advances made
pursuant to this Deed of Trust or the Credit Agreement.
31. Business Loan: Not Personal Residence. Grantor covenants, warrants and
represents that this Deed of Trust is a commercial loan and that all of the
proceeds of the Credit Extensions secured hereby shall be used for business or
commercial purposes, none of the proceeds of the Credit Extensions secured
hereby shall be used for personal, family or household purposes, and that no
individual liable for the Secured Obligations resides or intends to reside in
any portion of the Property.
32. Warranties and Representations. It is intended that this Deed of Trust
supplement the other Loan Documents, and the warranties, representations,
covenants and agreements made by the Grantor herein are supplemental to those
set forth in the other Loan Documents. In the event of a conflict between this
Deed of Trust and the other Loan Documents, the terms of this Deed of Trust
shall control with respect to the Land, the Improvements, the Property Leases
and the Revenues.
33. Fixture Filing. Certain of the Mortgaged Property is or will become
"fixtures" (as that term is defined in the UCC) on the Land, and this Deed of
Trust upon being filed for record in the real estate records of the county
wherein such fixtures are situated shall operate also as a financing statement
filed as a fixture filing in accordance with the applicable provisions of said
UCC upon such of the Mortgaged Property that is or may become fixtures.
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34. NOTICE OF INDEMNIFICATION: GRANTOR HEREBY ACKNOWLEDGES AND AGREES THAT
THIS DEED OF TRUST CONTAINS CERTAIN INDEMNIFICATION PROVISIONS (INCLUDING
WITHOUT LIMITATION THOSE CONTAINED IN SECTIONS 6(iii) AND 26(b) HEREOF, WHICH IN
CERTAIN CIRCUMSTANCES, COULD INCLUDE AN INDEMNIFICATION OF THE COLLATERAL AGENT
AND BENEFICIARY FROM CLAIMS OR LOSSES ARISING AS A RESULT OF THE COLLATERAL
AGENT'S AND BENEFICIARY'S OWN NEGLIGENCE.
THE WRITTEN DEED OF TRUST REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND
MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT
ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN
THE PARTIES.
[Remainder of page left intentionally blank]
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IN WITNESS WHEREOF, Grantor has executed this Deed of Trust under seal, as
of the day and year first above written.
Witness: GAMESTOP TEXAS LP
By: GameStop of Texas (GP), LLC,
its general partner
By: GameStop, Inc.
/s/ Dawn Hofer By: /s/ David W. Carlson
------------------------------------ --------------------------
Print Name: Dawn Hofer
Name: David W. Carlson
/s/ Matt Hodges
-----------------------------------
Print Name: Matt Hodges Title: Executive Vice President
and Chief Financial Officer
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STATE OF TEXAS
Tarrant County
On this 5th day of October, 2005, before me personally appeared the
above-named David W. Carlson, the Executive Vice President and Chief Financial
Officer of GameStop, Inc., a Minnesota corporation, which is the manager of
GameStop of Texas (GP), LLC, the general partner of GameStop Texas LP, the
Grantor named above, and acknowledged the foregoing to be his/her free act and
deed and the free act and deed of said Grantor.
/s/ Glenda Williams
-------------------------------
Notary Public
My commission expires:
(AFFIX SEAL)
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EXHIBIT A
LAND
Legal Description of Land
Being a 17.02 acre tract of land situated in the City of Grapevine, Tarrant
County, Texas, being a part of the C. Clanton Survey Abstract Number 354, and
being all of Lot 2, Block 2 of Westport Business Park, an addition to the City
of Grapevine as recorded in Cabinet A, Slide 5797 of the Plat Records of Tarrant
County, Texas.
900652.2900652.2
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