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MORTGAGE AND SECURITY AGREEMENT

Dated: March l. ~. 1995
in thC' amount of
54,000,000

(the "Mortaaa" Amount n )

From
DONALD J. TRUMP
having an address at:
clo The Trump Organization I
725 Fifth Avenue
New York. New York 10022
(the "MortlaIDI''')
To
BLACKACRE BRIl>GE PARTNERS, L.P.
and
NEW VALLEV CORPORA1'lON
" , having an address at:
950 Third Avenue
17th Floor
,
Ntw York, Nt'" York 10022
(collectively. the "Mortgagee")

The Unit Affected By This Mortgage:

~signation Tax Lot Number
"\"
Residential Unit 66/67/68N 1263

The Name and Location ofthe Condominium which Established The Unit:
Trump T/)wer Condominium
721725 Fifth Avenue
'
New York, New York 10022

Block
it
of the Borough of Manhattan on the Tax Map of
the Rea roperty Assessment Department of the City of
New York
.e = Me

After recording, please return to:

DREYER AND TRAUB
101 Park Avenue New York, New York 10178
Attention: Edwa~ L Barris, Jr., Esq.
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Blackacre Bridge Partners, L.P. and New Valley Corporation (collectively, the
"Mortgagee") has loaned $4,000,000 (the "Mortgage Amount") to Donald J. Trump (the
"Mortgagor") which is evidenced by a note (the "Note") of the Mortgagor, dated the date hereof,
in that amount and the Mortgagur, In order to secure the payment thc:reof, hils duly cxcoutca and
delivered this Mortgage,

Certain Definitions

The Mortgagor and the Mortgagee agree that, unless the context otherwise
specifies or requires, the following terms shall have the meaninss herein specified, Buoh definitions
to be Applicable equally to the slnsular and to the plural fonns of such terms,

"Building" means the building known as Trump Tower and by the addresa 721725
Fifth Avenue, New York, New York, in which the Premises are located,

"Chattels" means all fixtures, fittings, appliances, apparatus, equipment, machinery,

tools and articles of personal property, and replacements thereof, now or at any time hereafter
affixed to, attached to, placed upon or used in any way in connection with the complete anc!
comfortable use, enjoyment, occupancy or operation of the Premises. To the extent any portion
of the Chattels Is not deemed real property or fixtures under applicable law, it shall be deemed to ,
be personal property, and this Mortgage shall be deemed to constitute a security agreement for
the purposes of creating a security interest therein in favor of the Mortgagee under the Unifonn
Conunercial Code of the state wherein the Premises are located (the "UCC");

"Condominium" means the condominium known as Trump Tower Condominium,

"Condominium Board" means the Board ofManugers cfthl} Condominium,

"Condominium Documents" means all of the followins, as they or any of them may
have been, or may in the future be amended:

(i) the Declaration;

(Ii) the by-laws of the Condominium; and

(ill) the Rules and Regulaticns ofthe Condominium.

"Declaration" means the Declaration of Condominium dated February 24, 1983

(the "Dee;laration") establishing a plan for condominium ownership under Article 9-B of the Real
Property Law of the State of New York (the "New York Condominium Act"), recorded in the
New York County office of the Register of the City of New York (the "City Registe~s Oftlce") on
Mard123, 1983, in Recl674 Page 848, 88 amended by first amendment dated oaobcr 11, 1994

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(the "First Amendment to Declaration"), recorded in the City Registerls Office on November 31
1994 in Reel 2152, Page 404 (which First Amendment to Declaration WIlS fe-recorded in the City
Registerls Office as Amendment to First Amendment to the Declaration of Trump Tower
Condominium on December I, 1994 in Reel 2159, Page 333).

IIEvents of Default ll means the events and circunlstances described as such in

Section 2.01 hereofand elsewhere in this Mortgage.

"Guarantor" meanIJ any party or partieIJ, if any, who have guaranteed the payment
of the Note.
tlIntangibles ll means allUgenerallntangibles l1 (as such quoted term is defined in the
Uniform Commercial Code of the state wherein the Premises are located) In any way relating to
the Premises and In which the Mortgogor hilS ony Interest, all licenses, trade name, good will and
books and records relating to tho business operated or to be operated on the Premises or any part
thereof, and all unearned premiums, accrued, accruing or to accrue under all insurance policies
now or hereafter obtained by the Mortgagor insuring the Mortgaged Property, as hereinafter
defined, and all rights and Interest of Mortgagor thereunder.

IIlnvoluntary Rate" means the applicable rate of interest por annum provided In the
Note plus 5%, but ill no event to exceed the maximum rate allowed by law.

"Land ll means the real property under the Building which is more particularly
described on Schedule B hereto.

"Premises II means Residential Unit No. 66/67/68N in the Condominium (the

"Unin, said Unit being more particularly dQscribcd on Schedule A hereto. The Unit is located in
the Building.

All terms of this Mortgage which are not def1ntd above have the meaning set forth
in this Mortgage and/or the Note.

Granting Clause

NOW, THEREFORE, the Mortgagor, ill consideration of the premises and in

order to secure payment of both the principal of the Note and the interest thereon a~d any other
sums payable thereon, and/or under this Mortgage and the performance and observance of all the
provisions hereof and of the Note (collectively, all of such obligations are hereinafter referred to
as the IIlndebtedness"), hereby gives, grants, bargains, sells, warrants, aliens, remises, releases,
conveys, assigns, transfers, mortgages, hypothecates, deposits, pledges, sets over and conflnns
unto the Mortgagee all its estate, right, title and interest in, to and under any and all of the
following described property (the "Mortgaged Property"), whether flOW owned or held or
hereafter Kqulred:

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(a) the Premises;

(b) all of the Mortgagor's rights 8S owner of the Premises with respect to (I)
, the Building in which the Premises are located. (Ii) thtl Land on which the Building is situated and
(III) the land that lies in the streets or roads in front of, or next to, the Building and the Land.

(c) the ChaUels;

(d) the Intangibles;

(e) all casements, rights-or-wR)', strips and gores of land, str~ets, ways, alleys,
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passages, sewer rights, water, wells. wIlter courses, water rights and powers, ditches, ditch rights,
',,'..\' reservoirs and reservoir rights, air rights and development rights, lateral support, drainage, 8as, 011
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and minerai rights, Iibertlell, tenements, hereditaments lind appurtenances of any nature
' ... j,

"',: . whatsoever, in any wa'l belonging, relating or pertaining to the Premises and t.he reversions and
remainders, whether existing or hereafter acquired, and all land lying in the bed of any street, road
or avenue, opened or proposed, in front of or adjoining the Premises to the center line thereofand
any and all sidr:walks, drives, curbs, passageways, streets, spaces and alleys adjacent to or used In
connection with the Premises and all the estates, rights, titles, Interests, dower and righta of
dower, curtesy and rights of curtesy, property, possession, chtim and demand whatsoever, both in
law and in equity, of the Mortgasor ot: in and to the Premises and every pan and parcel thucof.
with the appunenances thereto;

(f) all awards or payments, including interest thereon, which ma'l hereafter be
made with respect to the Premises or the Chattels by means of a taking or condemnation in
eminent domain or conveyance in lieu thereof and any and all refunds with rcspect to the payment
of property taxes and assessments. togcther with the right, following an Event of Default, to seek
11 reduction or reductions in the assessed valuation of the Mortgaged Property for real property
tax purposes or for any other purpose and to prosecute or continue any action or proceeding in
connection therewith, and all other proceeds of the conversion, voluntary or involuntary, of the
Premises or any other Mortgaged Property or part thereof into cash or liquidated claims;

(g) all proceeds of and any unearned premiums al.:crued. accruin~ or to accrue
under any insurance policies including. without limitation, casualty insurance or any other
insurance now or hereafter maintained covering the Premises or the Chattels, including. without
limitation, the right to receive and apply the proceeds of any insurance, judgments. or settlements
made in lieu thereof, for damage to the Premises or the Chattels and all refunda or rebates of
tax~ and interest paid or payable with respect thereto;

(h) the right, in the name and on behalf of the Mortgagor, to appear in and
defend any action or proceeding brought with respect to the Premises or the Chattels and to
commence any action or proceeding to protect the interest of the Mengasee in the Premises or
the Chattels;

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(i) all right, title and intere!!t of every nature of the Mortgagor In all monies
deposited or to be deposited in any funds or IlCCountli maintained or dcpollited with tho
Mortsasec, or ita a8slsn&, in connection h"rewith;

(j) all :Accounts receivable, contract rights, fi'anchises, authorizations,

approvals, permits, variance and land u~e entitlements for constnlction, use, occupancy and
operation of the Premises together with any modifications, renewala or extensions tbereof,
interests, estate or other claims, rights or privileges, both at law and In equity, relating to the
Premises or the Chattels Includlos. without limitation, any of the foregoing rclatina to
construction on the Premises;

(k) all claims against any pcrson with respect to any damage to the Premlses or
the Chattela includins, without limitation, damagc arising from any defect in or with respect to tho
design or constNctioll of the Premises or the Chattels and any damage resulting therefrom;

(I) all deposits or other security 01' advance payment a, Includln8 rental
payments made by or on behalf of the Mortgllgor to others, with respect to (II) insurance policies,
(b) utility services, (c) cleuning, maintenance, repair or similar services, (d) refuae removal or
sewer service, (e) parking or similar services or rights and (t) rental of equipment, if any, reladng
to or otherwise used in the operution of the Premises or the Chattels;

(m) all intangible property relating to the Premlaes or the Ch(\ttels or its
operation including, without limitation. trade names, trademarks, logos. buUding names and
goodwill;

(n) all of the M.ortgagor1s rights as a "Unit Owner" In the Condominium, Il!I set
forth in the Condominium Documents;
: ~t , (0) rJI drawings, designs, plans and specifications prepared by the architects,
engineers, interior designers, landscape desigi,en and any other consultants or professionals for
the design, development, construction. repair andlor improvement of the MOrtg8gf.d Property, as
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amended from time to time;
, " (p) 111l appurtenances and utility rights pertaining to the Premises or the
Chattels or any pOltion thereof, all zoning agreementB, all operating contracta, management
agreements, service contracts, supt>ly anJ maintenance contracts, equipment leases, and any
renewal, modification, amendment, supplement or replacement thereof, which a1feots or is used in
colUlcction with the Mortgaged Property or any part thereot;

(q) all renewals, substitutions, improvements, accessions, attachments,

additions, replacements and all proceeds to or of each of the foregoing, and all conversions of the
security constituted thereby that, immediately upon su~h acquisition, construction, assemblage,
placement or conversion, as the case may be, and in each such case the foregoing shall be deemed
a part of the Mortgaged Property and shall automatically become subject to the lien of this
Mortgage as full)' and comple,tel), and with the same priority and effect as thou8h now owned by

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the Mort8agor and specifically described herein. without any further mortgage or assignment or
oonveyance by the Mortgagor;

(r) all proceeds of the conversion. voluntary or involuntary. of any of the

foregoing into cash or liquidated claims. including. without limitation. proceeds of hazard and title
insurance and condemnation awards;

(8) all leases and lettings of the Premises now or hereafter entered into and all
right. title and Interest of the Mortgagor thereunder. including. without limitation, cash or
securities deposited thereunder to secure perfClrmance by the lessees of their obligations
thereunder, whether such cash or securities are to be held until the expiration of the terms of such
leases or applied to one or more of the installments of rent coming due immediately prior to the
expiration of such terms. including, further, the right, upon the happenin8 of an Event of Dctau It,
to receive and collect the rents thereunder, together with all rents, oil and 8as or other minerai
royalties, revenues and bonuses, issues and profits from the Premises Of' the Chattels under the
aforesaid leases or otherwise and all proceeds from the sale or other disposition of the Icmses; and

(t) all contract rights of the Mortgllgor arising out of or relating to any or all
orthe foregoing.

1'0 HA VI AND TO HOLD unto the Mortgagee. its successors and asaigns
forever,

NotwithstandinH anything to the contrary contained herein, the maximum amount

of principal indebtedness secured by this Mortgage at the time of execution or which under any
contingenry may hereafter become secured hereby at any time is Four Million dollars
($4,000.000.00); ~ that such limitation shl\lI not limit the security of this Mort8age with
r.espect to (i) interest on the aforesaid maximum amount of principal indebtedness at the rates set
forth in the Note. (ii) sums to pay taxes and other impositions, including. without limitation,
common charges, assessments and other sumfl payable by the Mortgagor under or pursuant to the
Condominium Documents (iii) sums to pay premiums on insurance policies coverin8 the
Mortgaged Property, (iv) expenses incurred in defending, maintaining, upholdin8 or enforcin8 the
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lien of this Mortgage, including, but not limited to, the expenses of any litigation to prosecute or
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Mortgage which if not limited by such limitation would not increase the amount of mortgage
recording taxes, if anyI payable with respect to this Mortgage,
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ARTICLE I

Particular Covenants of the Mortgagor

The Mortga8or covenants and a8r~es as follows:

Section 1.01. The Mortgagor represents and warrants that it has a good and
marketable title to an indefeasible fee estate in the Premises subject to no lieDs charse or

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encumbrance, except such 8S are listed as exceptions to title in the title policy insuring the lien of
this Mortgage (the "Permitted Exceptions"); that it will own the Chattels and the Intangibles free
(1 and c.:lear of liens and claims other than the Permitted EX(1eptions; that this Mortgage i8 and will
remain a valid and enforceable lien on the Mortgaged Property subject only to the c:xcept!ons
t referred to above; that the execution and delivery of this Mortgage and the Note has been duly

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authorized by the Mortgagor and that there is flO provision in any document that evidences or
establishes the existence of the Mortgagor requiring further consent for such action by any other
entity or person; that, if the Mortgagor is a partnership, corporation or other entitYI it is duly
organized, validly existing and is in good standing under the laws of the stllte of its formation or
:. , incorporation, as the case may be; that it has (i) all necessary licenses, authorizations,

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reglstritlon!l, permits andlor approvals and (iI) full power and authority to own its properties and
carry on Its business as presently conducted Bnd the execution and delivery by it of and
performance of its obligations under, this Mortgage and the Note will not result in the Mortgagor
being in default under any provisions of any document which evidences or establishes the
::.:,:~',~;,:,,:, "I~\ :;' existence of the Mortgagor or of any mortgage, credit or other agreement to which MOl1gagor ill
',::;;;1:'.' -t . , a party or which affects the Mortgagor or the Premises. or any part thereof, that it will preserve
such title except as otherwise permitted herein, lind will forever warrant and defend the same to
,I the Mortgagee, and will forever warrant and defend the validity and priority of the lien hereof
I against the claims of all persons and parties whomsoever.
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:i:,:~';: ;~ :, ;:':;:,.: ..'.'::.":'':' Section 1.02. The Mortgagor will, at the sole cost ofthe Mortgagor, and without
expense to the Mortgagee, do, e"ecute, acknowledge and deliver all altd every such further acts,
)':'~:~' deeds, cOIl\'eyances, mortgages, assignments, notices of assignment, transfers and assurances as
the Mortgagee shall from time to time require, for the better assuring, conveying, as(lignlng,
tl'Msferring and confirrning unto the Mortgagee the property and rights hereby conveyed or
assigned 01' intended now or hereafter so to be, or which the Mortgagor may be or may hert"..after
become Lound to conveyor assign to the Mortgagee, or for carrying out the intention or
facilitating the pcrfonnance of the terms of this Mortgage, or for filing, registering or recording
this M,)rtgage and, on demand, will execute and deliver, and hereby Buthori:r,es the Mortgagee to
e"ecute and file in the name of the Mortgr.gor, without the signature of the Mortgagor, to the
extent it may lawtully do 80, one or more financing statements, chattel mortgages or comparable
security instruments to evidence more effectively the lien hereof upon the Mortgaged Property or
any part thereof.

Section 1.0:i, (a) The Mortgagor forthwith upon the execution and delivery
of this Mortgage, and thereafter from time to time, will cause this Mortgage and any security
instrument creating a lien or evidencing the lien hereof upon the Chattels andlor the Intangibles
and each instrument of further assurance to be filed, registered and/or recorded in such manner
and in such places as may be requited by any present or future law in order to publish notice of
and fully to pr~tect the lien hereof upon, and the interest of the Mortgagee in. the Mortgaged
Property.

(b) The Mortgagor will pay all filing, registration or recording fees, and all
e"penscs incident to the e"ecution and acknowledgment of this Mortgage, any mortgage
supplemental hereto, any security instrument with respect to the Chattels or the Intansiblea. and

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other tllXes, duties, imposts, assessments and charges in connection with the execution and
delivery afthe Note, this Mortga!le or allY mortgage supplemental hereto, any security instrument
with respect to the Chouels and/or the Intangibles or any instrument of further assurance.
1"~".'"\':.1:1~1 Section 1,04, The Mortgagor will punctually pay the principal and interest and all
~~:.j',. ,.r! ~:. \"
.. ' \' . other sums to become due in respect of the Note at the time and place and in the manner specifled
in the Note, according to tho true intent and meaning thereof, all in any coin or currency of the
United States of America which at ~he time of such payment shall be legal tender for the payment
of public and private debts.

Section 1.05, The Mortgagor, if a corporation, will, so long as it is owner of the

Mortgaged Property or any pan thereof, do all things necesSBry to preserve and keep in full force
and effect Its existence, franchises, rights Ilnd privileges as a business or stock corporation under
the laws of the state of itll incorporation and will comply with all regulations, rules, ordinances,
statutes, orders and decrees of any govel11mental authority or court applicable to the Mortgagor
or to the Mortgaged Property or any part thereof.

Section \ ,06, All right, title and interest of the Mortgagor in and to all extensions,
improvements, betterments, renewals, substitutes and replacements of, and 011 additions and
appurtenances to, the MOl1gaged Propeny hereafter acquired by, or released to, the Mortgagor,
or c\'lnstructed, assembled or placed by the Mortgagor on tho Premises or any part thereof, and all
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construction, assembling, placement or conversion, as the case may be, and in each such case,
without any further mortgage, conveyance, assignment or other act by the Mortgagor, shall
become subject to the lien of this Mortgage as 'fully and completely, and with the sarne effect, as
though now owned by the Mortgagor and specifically described in the granting clause hereof, but
at any and all times the Mortgagor will execute and deliver to the Mortgagee any Rnd all such
further assurances, mortgages, conveyances or assignments thereof as the Mortgagee may
reasonably require for tho purpose of expressly and specifically subjecting the sarne to the lien of
this MortgBge.

Section 1,07, (a) The Mortgagor, frorn time to time when the same become
due and payable, will pay and discharge all taxes of every kind and nature, all general and special
assessments, levies, permits, inspection and license fees, all water and sewer rents and charges,
and all other public charges whether of a like or different nature, ilTlposed upon or assessed
against the Mortgaged Property, or any part thereof, or upon the revenues, rents, issuel, income
and profits of the Mortgaged Property, or any part thereof, or arising in respect of the occupancy,
use or possession thereof. The Mortgagor will deliver to the Mortgagee receipts evidencing the
payment of all such taxes, assessments, levies, fees, rents and other public charges imposed upon
or assessed against the Mortgaged Property, or any part thereof, or tbe revenues. rents, issues,
income or profits thereof.

The Mortgagor shall deposit with the Mortgagee, at the time of each
payment of an installment of interest or principal under the Note, an additional amount equal to

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one-twelfth of the aggregate annual amount of all real estatt'l taxes of every kind and nature, all
general and special assessments. all water and sewer rents and charges and all other public charges
imposed upon or assessed again tit the Mortgaged Property or any part thereof. Such amounts
shall be held by the Mort8agee without interest and disbursed to the Mortga80r in reimbursement

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of amounts eKpended by the Mortgagor in payment of the obligations in respect to which such
amounts were deposited upon receipt by the Mort8flgee of evidence that such obllgathms had
been paid, Upon the occurrence of an Event of D~fault hereunder, amounts held by the
M0I1gagee may be applied in payment of the obligations in respect to which such amounts were
deposited or. at the option of the Mortgagee, to the payment of said obligations in such order or
priority as the Mortgagee shall determine, on or before the respective dates on which the same or
any of them would become delinquent. If one month prior to the due dale of any of the
aforementioned obli8ations the amounts then on deposit therefor shall be insufficient for the
payment of such obligation in full. the Mortgagor withi,} five (5) days after demand shall deposit
the amount of the deficiency with the Mortgagee. Nothing herein contained shall be deemed to
affect any right or remedy of the Mortgagee under any provisions of this Mortgage or of any
statute or rule of law to pay flny such amount and to add the umount so paid to the Indebtedness,
In connection with the foregoing. the Mortgagee will engRge a taK searching and reporting acMCft
the coat of which shall be paid for upon demand by the Mortgagor.
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(b) The Mortgagor will pay. from time to time when the same shall become
due. all lawful claims and demands of mechanics. materialmen, laborers and others. which claims
and demands, if unpaid. might result in. or permit the creation of, a lien on the Mortga8ed
Property or any part thereof, or on the re,,'enues, rents, IDsues, income and profits arising
therefrom and in general will do or cause to be done everything necessary so that the lien hereof
shall be fully preserved, at the cost of the Mortgagor, without expense to the Mortgagee .
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.I, "".', I (c) 'Nothing in this Section 1,07 shall require the payment or discharge of any
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obligation imposed upon the Mortgagor by this Section so long 8S the Mortgltgor ~hall in good
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I' . \,,' faith and at its own expenne contest the same or the validity thereof by appropriate logal
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proceedings which shall operate to prevent the collection thereof or other realization thereon and
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the sale cr forfeiture of the Premises or any Pllrt thereof to satisfy the same; provided that during
such contest the Mortgagor shall provide security satisfactory to the Mortgagee, assuring the
discharge of the Mortga8or/s obligation hereunder and of any additional charge, penalty or
expense arising from or incurred as a result of such contest; and provided further that if, at any
time, payment of any obligation imposed upon the Mortga80r by subsection (u) of this Section
shall become necessary to prevent the delivery of a tax deed, or its equivalent, conveying the
Mortgaged Property. or any part thereof, because of non-payment, then the Mortgagor shall pay
the same in sufficient time to prevent the delivery of such tax deed or its equivalent.
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Section 1.08. In the event of the passage of any law deductin8 from the value of
land for the purposes of taxation any lien thereon or changing in any way the taxation of
mortgages or debts secured thereby for state or local purposes the Mortgagor shall either (a) pay
all such taxes imposed on the Mortgagee or (b) if, in the opinion of the Mortgagee, it shall be
iIIe8al for Mortgagor to pay any such tl)( or if the payment of such tax by Mortgagor would result
in a violation oCthe usury laws of the state in which the Premises are located, within ten (10) days

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of demand by the Mortgagee, repay all sums evidenced by the Note and secured hereby, together
with all interest accrued and unpaid thereon to the date of' such repayment and any applicable
prepayment premium.

Section 1.09. (a) The Mortgagor shall keep the Premises and Chattels in,ured
against damage by fire and other hazf\rds covered by the standard extended coverage insurance
policy, and each polley shall be endorsed to name the Mortgagee as an insured thereunder, as Its
interest may appear, with loss payable to the Mortgagee, without contribution or assessment,
under a standard New York mortgagee cla\'se. All insurance policies and endofllements required
pursuant to t.his Section 1.09 shall be fully paid for, nonassessable and contain such provision& and
expiration dates and be in such form and amounts as. shall be satisfactory to the Mortgagee and
shall be issued by an insurance company or companies with a rating of II A", Class XII or better as
established by Best's Rating Guide, or an equivalent rating with such other publication of. similar
nature as shall be in current use or otherwise acceptable to the Mortga8ee. Without limiting the
foregoing, each policy shall specifically provide that such policy may not be cancelled for any
reason except upon thirty (30) days prior written notice to the Mortgllgee and that no act or thing
done by the Mortgagor shall invalidate the policy as Bgainst the MOI'gagee. In addition, the
Mortgagee may require the Mortgagor to carry such other insurance on the Premises and Chattells
in such amounts as it may from time to time require against insurable casualties (including risks of
war and nuclellr explosion) which at the time are commonly insured against in the case of
premises similarly situated. The Mortgagor will deliver certificates cvid~ncln8 such Insurance and
duplicate originals or certified copies of the policy or policics of all such insurance to the
Mortgagee, which policy or policies shull have endorsed thereon the standard New York
mortgagee clause in the name of the Mortgagee, so and in such manr.er and form that the
Mortgagee and its successors and assigns shall at all times have and hold said polley or policies as
coUaleaat and fhrther security for the payment of the Indebtedness until the full payment of the
Indebtedness. In addition, from time to time, upon the occurrence of any change in the use,
opt'ration or value of the Premises, or in the availability of insurance in the area in which the
Premises are located, the Mortgagor shall, within five (5) days after demllnd by the Mortgagee,
take out such additional amounts and/or such other kinds of insurance as the Mortgagee may
require. No later than thirty (30) days prior to the eKpiration of any policy of irulurance required
under this Mortgage, the Mortgagor shall deliver to the Mortgagee evidence satisfactory to the
Mortgagee that such policy has been replaced, renewed or extp.nded to a date not earlier than one
year from the date of such scheduled expiration and that all premiums payable with respect to
such replacement, renewal or extension have been paid in full.
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(b) The Mortgagor shall not take out separate insurance concurrent in form or
contributing in the event of loss with that required to be maintained under this Section 1.09,
unless the Mortgagee is included thereon as a named insured with loss payable to the Mortgagee
under a standard mortgage endorsement of the character above described. The Mortgagor shall
immediately notity the Mortgagee whenever any such separate insurance is taken out and shall
promptly deliver to the Mort8agee the policy or policies of such insurance.

(c) If the Premises, Of any part thereof, are located in an area which has been
identified by the Secretary of Housing and Urban Development as a flood hazard area, the

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Mortgagor will keep, for as long as any Indebtedness remains unpaid. the Premises covered by
flood Insurance in an amount at least equal to the full amount of the Note or the maximum limit of'
coverage available for the Premises under thel National Flood Insurance Act of 1968. whichever II
1018.
(d) The Mortgagor shall give the Mortgagee prompt notice ofany loss covered
by Insurance and the Mortgagee shall have the right to join the Mortgagor in adjusting any loss In
eKcess of $50,000. Losses of $50,000 or less may be adjusted by the Mortgagor without
participation by the Mortgagee. Notwithstanding allY thing to the contrary contained herein or In
Section 254 of the Real Property Law of the State of New York or any other provision of
applicable law, the proceeds of insurance Ilolicies coming into the possession of the Mortgagee
shall not be deemed trust funds. Any moneys received as payment for any losil under any such
insurance shall be paid over to the Mortgasee to be applied at the option of the Mortgagee and in
the Mortgagee's sole discretion either to the prepayment of the Indebtedness, whether or not the
same is then due and payable, or to the reimbul'sement ofthe MortgAgor for expenses incurred by
it in the restoration of the Premises.
Section 1.10. If the Mortgagor shall fail to perform any of the covenants
contained in Section 1.01,1.03,1.07,1.08.1.09, l.l2or 1.19 the MortgRgce may make advances
to perform the same in its behalf, and all sums so advanced shall be a lien upon the Mortgaged
Property and shall be secured hereby. The Mortgagor will repay on demand all sums so advancrd
on its behalf with interest at the Involuntary Rate from the date such sums arc advanced by the
Mortgagee. The provisions of this Section 1.10 shall not prevent any default in the observance of
any covenant contained in said Section 1.01, 1.03, 1.07, 1.08, 1.09, 1.12 or 1.19 from
~nstituting an Ev"nt of Default,

Section 1.11. (a) The Mortgagor will permit the Mortgagee, by its agents.
~ccount8nts and attorneys, to visit and inspect the Premises and to discuss its affairs, finances and
accounts with the Mortgagor, at such reasonable times as may be requested by the Mortgascc and
to examine Mortgagur's record, and books of account.

(b) The Mortgagor, within five (5) days upon request in person or within seven
(7) days upon request by mail, will furnish a written &tatemcnt duly acknowledged of the amount
due whether fol' principal or interest on the Note and whether any offsets, counterclaims or
defenses exist against the Mortgagee, or the Indebtedness, or any part thereof,
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Section 1.12. The Mortgagor will not commit any waste on the Mortgaged
l;::,'-r;:,I", Property, or any part thereof, or make Ilny change in the use of the Mortgaged Property, or any
j, ,,' part thereof, which will in any way increase any ordinary fire or other hazard arising out of
construction or operation unless any such increased risk is fully and adequately covered by
insurance. The Mortgagor will, at all times, maintain the Premises ill good operating order and
condition and will promptly make, from time to time. all repairs, renewals. replacements, additions
and improvements in connection therewith which are needful or desirable to such end.

10

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Section 1. 13, The Mortgagor, immediately upon obtaining knowledge of the
institution of any proceedings for the condemnation of the Premiscs or any part thereof, will
notifY the Mortgagee of the pendency of such proceedings, The Mortgagee may participate in
any such proceedings and the Mortgagor from time to time will deliver to the Mortgagee all
instruments requested by it to pennit such participation, In the event of such condemnation
proceedings, the award or compenllatlon payablc Is hereby assigned to nnd shall be paid to the
Mortgagee, subject to the rights of the Condominium Board to apply such award to repair or
restoration. The Mortgagee shall be under no obligation to questilm the amount of any such
award or compensation and may accept the same in the amount In which the same shall be paid.
In any such condemnation proceedings, the Mortgagee may be represented, at the expense of the
Mortgagor, by counsel selected by the Mortgagee. The proceed~ of any award or compensation
so received shall, at the option of the Mortgagee, either be applied toward the payment of tho
Indebtedness, whether or not the same Is then due and payable, or be paid over to the Mortgasor
for restoration of the Premises. In the event that any portion of the condemnation awards or
compensation shall be used to reduce the Indebtedness. same shall be applied by the Mortgagee in
any manner it shall designate, including, but not limited to. the application of such award or
compensation to the then unpaid installments of the principal balance due under the Note In the
inverse order of their maturity such that the regular payments under the Note shall not be reduced
or altered in any manner. The Mortgagor, upon request by the Mortgllgee. shall make, execute
and deliver any and all instruments requested for the purpose of confirmins the assignment of the
aforesaid awafds and compensation to the Mortgagee free Ilnd clear of any liens, ch/uges or
encumbrances of any kind or nature whatsoever, The Mortgagee shall not be limited to the
interest paid on the proceeds of any award or compensation, but shall be entitled to the payment
by tho Mortgagor of interest at the applicable rate provided for in the Note.

Section 1.14. (a) The Mortgagor will not (i) execute an assignment 0,( the
rents. or any part thereof, from the Premises or (ii) in any other manner impair the value of the
Mortgaged Property ur the security of this Mortgage. \

(b) The Mortgagor will not execute any lease or other agreement fo, use or
occupancy of all or any portion of the Premises.

Section 1. 15 The Mortgagor shall furnish to the Mortgagee, within thirty (30)
days after a request by the Mortgagee to do so. a written statement containing the names of all
lessees of the Premises, the terms of their respective leases, the space occupied and the rentals
payable thereunder.
Section 1.16. The Mortgagor, in compliance with Section 13 of the Lien Law,
will receive the advances secured by this Mortgage and will hold the right to receive such
advances as a trust fund to be applied first for the purpose of paying the cost of improvement and
will apply the same first to the payment of the cost of improvement before using any part of the
total aCthe same for any other purpose.

Section 1.17. In the event any payment provided for herein or in the Note shall
become overdue for a period in excess oftive (5) days after the due date thereof. a late gharge in

11

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ar. amount equal to f1v~ (5) cents for each dollar so overdue shall become Immediately due to the
,. Mortgagee for the purpose of defraying the expenses incident to handling such delinquent
payment, and such charge shall be deemed to be part of the IndebtedneslI and therefore secured by
the lien of this Mortgage. Lat" charges shall bc payable with the next Installment of prinolpal
andlor intercst due under the Note,

Section 1.18. The Mortgagor agrees that it shall indemnify and hold the
Mortga8C1e harmless against any loss or liability, cost or expense, including without limitation, any
judgments, attorneys' fees. costs of appeal bonds lind printing costs, arising out of or relating to
any proceeding instituted by any claimant alleging priority over the lien of this Mort8age and/or If
the Premises or any part thereof is within the State of New York by any clnlmant .lIeglng a
violation by the MortSAgor or the MortSll8ec of any scction of Aniclc 3A of the Licn Law ofthc
State of New York.

Section 1.19. (a) The Mortgagor covenants and agrees duly and fully to
perform all of the Mortgagor's obligations under the Condominium Documents. The Mortgagor
shall promptly pay directly to the proper recipient and before they are overdue, all monthly
installments of common chllrges, any special assessments and any other sums of ntnney due to or
imposed against tho Mortgaged Property by the Condominium BOllrd under the Condominium
Documents.

(b) So long as the Condominium Board maintains, with an insurance carrier

satisfactory to the Mortgagee. a "master" or "blanket" policy on the Condominium which Is
satisfactory to the Mortgagee and which provides insurance coveragc in the amounts, for the
periods, and against the hazards the Mortgagee requires, including fire and hazards included
within the term "extended coverllge," then the Mortgagor's obll,gation hereunder to maintain
hazard insurance coverage on the Mortgaged Property is deemed satisfied to the extent that the
required coverage is provided by such policy providp,d that (i) a certificate showing that such
policy is in effect. or a duplicate copy of such policy is delivered to the Mortgagee and (ii) not
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suc.h policy has beelll'enewed and the premiums therefor paid. for a period of not less than !lix (6)
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months. The Mortgagor 9hall give the Mortgagee pmmpt notice of any lapse in required hazard
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insurance coverage. Such policy shall include a standard New York mortgagee clause In favor of
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the Mortgagee, which clause shall permit payment of the proceed of such policy to the
Condominium Board (as agent fbr 'the unit owners of the Condominium) in order to restore
damage.

(c) In the event ofa distribution of hazard insurance proceeds in lieu of restoration or
repair following a 1088 to the Mortgaged Property. whether to the Unit or to conunon elements,
any proceeds payable to the Mortgagor arc hereby assigned and shall be paid to the Mortgagee
for application to the sums secured by this Mortgage, with any excess paid to the Mort8agor.

(d) The Mortgagor shall take such actions as may be necessary to insure that the
Condominium Board maintains a public liability insurance policy acceptable in form, amount. and
extent of covera8e to the Mortgagee.

12

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(e) The proceeds of \lny award Of claim for damages, direct or consequential, payable
to the Mortgagor in connection with any condemnation or other taking of all 0\' any part of the
Mortga8ed Property, whether of the Unit or of the common elements, or for any conveyance In
lieu of condcmnation. are hereby assigned and shall, subject to the rights of the Condominium
Board under the Condominium Documents to apply such award to repair ~)r restoration, be paid
to the Mortgagee for application to the sums secured by dus Mortgage, with any excess paid to
the Mortgagor.

(t) The Mortgagor shall not, except aftcl' notice to the Mortgagee and with the
Mortgagee's prior written consent, which may be given or withheld in the sale diSQration of tho
Mortsaacc, either partition or subdivide the Mortgaged Property or consent to:

(i) the abandonment or termination of the

Condominium, except for abandonment or termination required by
law In the case of substantial destruction by fire ur other canualt)' or
in tho <:aSCI of a taking by condemnation or eminent domain;

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(ii) any amendment or change to any provision
of the Condominium Documcnts (including, for elulmple, a change
in the percentllge of ownership rights that the Mortgagor has in the
(:ondominium);

(iii) termination of professional management and

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(iv) any action which would have the effect of
rendering the public liability insurance coverage maintained by the

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(v) the transfer, release, creation of liens,

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or common facilities of the Condominium (other than a transfer by
the Condominium Board ofriShts to use those common elements or
common facilities for utility and other similar or related purposes),

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ARTICLE II

Events of Default Ind Remedies

Section 2.01. If one or more ofthe following Events of Default shall happen. that
is to say:
(a) if (i) default shall be made in the payment of any interest due under the
Note or hereunder, or in the payment of any installment of principal due under the Note or
hereunder, in either such case, when and as the same shall become due and payable, and such
default shall have continued for a period of ten (10) days or (II) default shall btl made in any oth~r
payment of the principal of' the Note, when and as the same shall become due and payable,
whether at maturity or by acceleration or otherwise, in each case, as in the Note and this
MortgaBe provided or default in the payment of any other Indebtedness due to the Mortgagee
under this Mortgage and such default shall have continued for a period of ten (10) days or (Iii)
dtlfault shall be made in the payment of any tal( required by Section 1.07 to be paid and said
default shall have corltinued for a period of twenty (20) days after written notice thereof shall
have been given to the Mortgagor by the Mortgagee; or

(b) if default shall be made in the due observance or performance of any

covenant or agreement on the part of the Mortgagor contained in Section 1.01, 1.03, 1.08, 1.09
or 1.19, and such default shall have continued tor a period of twenty (20) days after written notice
thereof shall have been given to the Mortgagor by the Mortgllgee. For the purposes of this
clause, if any representation made in Section 1.01 shall be incorrect, it shall be deemed to be a
default; 01'

(c) if default shall be made in the due observance Of pcrtormance of any other
covenant or condition on the part of the Mortgagor in the Notll or in this Mortgage contained,
and such default shall have continued for a period of thirty (30) days after written notice
srecifying such default and demanding that the same be remedied shall have been given to the
Mortgagor by the Mortgagee; or

(d) ifby the order of a court of competent jurisdiction, Il trustee, receiver or

.~ ~ ,!, ',I liquidator of the Mortgaged Property, or any part ther~ot: or of the Mort8agor shall be appointed
1 ',',\'1 51
and such order shall not be discharged or dismissed within sixty (60) days after such appointment;
or

(e) if the Mortgagor shall commence a voluntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effec\, or shall consent ~,o the
entry of an order for relief in an involuntary case under any such law or to the appointment of or
taking possession by a receiver, liquidator, assignee, trustee, custodian, sequestrator (or other
similar official) of the Mortgagor or of any substantial part of its property, or if the Mort8agor
shall make any general assigrunent for the benefit of creditors, or if the Mortgagor shall fail

14
 ',',

REEl2 I Q,5 PG 0 8 ~ I

8enerally to pay its debts as such debts become due, or if the Mortgagor shall take Iny lotion in
furtherance of any ohhe foregoin8; or

(t) if any of the creditors of the Mortgagor shall commence against the
Mortgagor an involuntary case under any applicable bankruptcy, Insolvency or other similar llw
now or hereafter in effect and if such case shall not be disoharged or dismissed within alxty (60)
days afte~ the date on which such case was commenced; or

(8) if flnal judgment for the payment of money in excess of $50,000 shall be
rendered against the Mortgagor and the Mortgagor shall not discharge the same or cause It to be
discharged within sixty (60) days from the entry thereof, or shall not appeal therefrom or from the
order, decree or process upon which or pursuant to which said judgment was granted. based or
entered, and secure a stay of execution pending such appeal; or

(h) if any of the events enumerated in clauses (d) through (g) of this Section
2.01 shall happen to any Guarantor or any of Its property; or

(i) if any Guarantor defaults under or attempts to withdraw, cancel or disclaim

liability under any guaranty or if any default shall have occurred pursuant to the terms of the
Guaranty; or .

G> if the Mortgagor sellll, transfers, assigns, conveys or encumbers the

Premises or any part thereof or any interest therein without the prior waitten conacnt of the
Mortgagee; or

(k) if any of the events enumerated in clauses (d) through (8) of this Section
2.01 shall happen to the Condominium or any of its property or ifthe Condominium is tenninated;
qr

(I) if the Premises are occupied by someone other than the Mortgll8or and the
Mortgagor's immediate family; or

(m) ifany shares of the capital stock of the Mortgagor or uny Guarantor, if the
Mortgagor or such Guarantor is a corporation, shall be sold, assigned, transferred, conveyed or
alienated, without the prior written consent of the Mortgagee; or

(n) if any partnership interest in the Mortgagor or any Guarantor, if the

Mortgagor or any such Guarantor is a partnership, shall he sold, arsigned, transferred l conveyed
or alienated, without the prior written consent of the Mortgagee; or

(0) if a default beyond applicable grace periods shall have occurred under any
other document or instrument securing or relating to the Note~

then lU'ld in every suc::h QUe:

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written notice slven to the Mortgagor, may declare the entire principal of the Note then

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outstanding (if not then due and payable), and all accrued and unpaid interest thereon, together
with all other Indebtedness, to be due and payable immediately, and upon any such declaration the
principal of the Note, said IIcr-rued and unpaid interest thereun, and all other Indebtedness shall
becom" and be immediately due and payable. anything in the Note or In this Mort81l8e to the
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contrary notwhhstanding; ,

11. During the continullnce of any such Event of Default, the Mortgagee
personally, or by its agents or attorneys, may enter into lind upon all or any part of the Premises,
and each and every part lhereof, and may exclude the Mortgagor, its agents and servants wholly
therefrom; and having and holding the same, may usc, operate, manage and control the Premises
and conduct the business thereof, either personally 01' by its lIuperintendents, managers, Rgents,
sCirvants, aUonleys or receivers; and upon every such entry, the Mortgagel'l, lit the expense of the
Mortgaged Property, from time \0 time, either by purchase, repairs or construction, may maintain
and rest~re the Mortgaged Propeny, whereof it shall become posses!lcd as aforesaid, may
complete the construction of any of the Premises lind in the course of such completion may make
such changes in the contemplated Premises as it may deem desirable lind nmy insure the same; and
likewise, fI'om time to time, at the expense of the Mortgaged Property, the Mortgagee may make
all necessary Of proper repairs, renewals and replacements and such useful p.lterations, additions,
betterments and Improvements thereto and thereon as to it may seem advisable; and In every such
case the M0I1gagee shall have the right to manage and operate the Mortgaged Property and to
carry on the business thereof and exercise all rights and powers of the Mortgagor with respect
thereto either in the name of the Mortgagor or otherwise as it shall deem best; and the Mortgagee
shall be entitled to collect llnd receive all earnings, revenues, rents, issues, profits and income of
the Mortgaged Property and every part thereof, all of which shall for all purposes constitute
property of the Mortgagor; and after deducting the expenses of conducting the business thereof
and of all maintenance, ft:Jpairs, renewllls, replacements, alterations, additions, betterments and
improvements and amuunts necessary to pay for taxes, assessments, insurance and prior or other
proper charges upon the Mortgaged llroperty, or any part thereof, as well as just and reasonable
compensation for the services of the Mortgagee and for all attorneys, counsel, agents, clerks,
servants and other employees by it properly engaged and employed, the Mortgllgl"~ shall apply the
moneys arisillg as aforesaid, first to the payment of the principal of the Note and the interest
thereon, when and as the sam~ shall become payable, and second to the payment of any other
Indebtedness and sums required to be paid by the Mortgagor under this Mortgage,

III, The Mortgagee. with or without entry. personally or by its agonts or attorneys.
insofir as applicable. may:

(I) sell the Mortgaged Property, or any part thereof, to the extent
permitted and pursuant to the procedures provided by law, and all estate, right, title and interest,
claim and demand therein, and right of redemption thereof, at one or more sales as an entity or in
parcels, and at such time and place upon such termtl and after such notice thereof as may be
required or permitted by law; or '

16

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(2) institute procecdinS8 for the cOlUplete or panial foroolosure of thia

Mort8ll8e; or

(3) take such steps to protect and enfbrcc Its rights whether by action,
suit or proceeding in equity or at law for the specific performance of any covenant, condition or
agreement in the Note or in this Mortgage, or in aid of the exccution of any power hercin granted,
or for 'any foreclosure hereunder, or for thr. enforcement uf any other appropriate loaal or
equitable remedy or otherwise as the Mortgagee shall elect.

Section 2,02, (Il) The Mortgagee may adjourn from time to time any salc by It
to be made under or by virtue of this Mortgllge by announcement at the time and place appointed
for such sale or for such adjourned sale or saleR; and, cKcept as otherwise provided by any
applicable provision oflaw, the Mortgllgee, without further nc)tice or publication. may make such
sale at the time and place to which the same shall be so adjourned,

(b) Upon the completion of any sale or sales made by the Mortgagee under or
by virtue of this Article II, the Mortgagee, or an officer of any court empowered to do so, shall
e"ecute and deliver to the accepted purchaser or purchasers a good and sufficient instrument, or
good and 8ufficient instruments, conveying, assigning und transferring 1111 estate, right, title and
interest in and to the property and rightn sold, The Mortsasee IR hereby irrevocably appointed the
true and lawful att.orney of the Mortgllgor, In Its name and stead, to make all necessary
conveyances, 8ssignments, transfers and deliveries of the Mortgaged Property and rights so sold,
and for that purpose the Mortgagee may execute all necessary instruments of conveyance,
assignment and transfer, and may substitute one or more persons with like power, the Mortgllgor
hereby ratifying and confirming all that its said attorney or such substitute or substitutes shall
lawfully do by virtue hureof. Nevertheless, the Mortgagor, if 80 requested by the Mortgagee,
shall ratifY and confirm any such sale or sales by executing and delivering to the Mortgagee or to
such purchaser or purchasers all such instruments as may be advisable, in the judgment of the
Mortgagee, for that purpose, and as may be designated in such request. Any such sale or !l8les
made under or by virtue of this Article 11, whether made under the power of sale herein granted or
under or by virtue of judicial proceedings or of Il judgment or decree of foreclollure and sale, shall
operate to divest all the estate, right, title, interest, claim and demllnd whatsoever, whether at law
or in equity, of the Mortgagor in and ~o the properties an~ rights so sold, nnd shall be a perpetual
bar both Ilt law anu in equity agdinst the Mortgllgor and against any and all person& "Iaiming or
who may claim the same, or any part therec;~: from, through or under the Mortgagor,

(c) In the event of any sale made under or by virtue of this Article II (whether
, "I' made under the power of sale herein granted or under or hy virtue of judicial proceedings or of a
" judgment or decree of foreclosure and sale), the entire principal of, and interc:st on, the Note, if
not previously due and payable, and all other sums req\\ired to be paid by the Mortgagor pursuant
to trus Mortgage, immediately thereupon, shall, anything in the Note or in this Mortgage to the
contrary notwithstanding, become due and payable.

(d) The purchase money, proceeds or avails of any sale made under or by
virtue of this Article lil together with any other surns which then may be held by the Mortgagee

17

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under this Mortgagc, whether under the provisions of this Article II or othcfWilie, shall be appUcd
as follows:

First: To the payment of the costs Dnd expenses of such sale, including
reasonable compensation to the Mortgagee, its agents and counsel, and of any judicial
proceedings wherein the same may be made, and (If all expenses, liabilities and advances made or
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or other oharges subject to whioh the Mortgaged Property shall have been sold.

Second' To the payment of the whole amount then due, owing or unpaid
upon the Note for principal and interest, with interest on the unpaid principal at the Involuntary
Rate from and after the happening of any Event of Default described in clause (a) of Scalion 2.01
from the due date of any such payment of principal until the same is paid,

Third: To the payment of any other Indebtedness and any other sums
required to be paid by the Mortgagor pursuant to any provision of this Mortgage or the Note.

" Fourth: 1'0 the payment of the surplus, ifany, to whomlioever may lawft.ally
I,'., \ be entitled to receive the same.
, '

(e) Upon nn~ sale ,!llade under or by virtue of this Article II, whether made
under the power of sale herein granted or under or by virtue of judicial proceedings or of a
judgment or decree of foreclosure and sale, the Mortgagee may bid for and acquil'e the
0,' \" ''..1 Mortgaged Property or any part thereof and in lieu of paying cash therefor may make settlement
, ,"', ,",' for the purchase price by crediting upon the indebtedness of the Mortgagor sc.cured by this
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, ,,<",,;"'1,) Mortgage the net sales price after deducting therefrom the expenses (If the snle and the costs of
the action and any other sums which the Mortgagee is authorized to deduct under this Mortgage.
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Section 2,03, (a) In case an Event of Default described in clause (a) of
1
Sectio" 2,01 shall have happened and be continuing, then, upon written demand of the
Mortgagee, the Mortgagor will pay to the Mortgagee the whole amount which then shull have
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become due and payable on the Note, for principal or interest or both, as the case may be, and
\";(' after the happening of said Event of Default will also pay to the Mortgagee interest at the
r"'I" "r ,,1, Involuntary Rate on the then unpaid principal ofthe Note, and the sums r~quired to be paid by the
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Mortgagor pursuant to any provision of this Mortgage, and in addition thereto such further
amount as shall be sufficient to cover the costs and expenses of collection, including reasonable
compensation to the Mortgagee, its agents, and counsel and any expenses incurred by the
Mortgage1l hereunder. In the event the Mortgagor shall fail forthwith to pay such amClunts upon
such demand, the Mortgagee shall be entitled and empowered to institute such actio II or
proceedings at law or in equity as may be advised by its counsel for the collection of the sums so
due and unpaid, and may prosecute any such actioll or proceedings to judgment or final decree,
and may enforce any such judgment or final decree against the Mortgagor and collect out of the
Mortgaged Property, in any manner ,provided by 'law, moneys adjudged or decreed to be payable.

18

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this Mortaagc; and the right of the Mort8agee to recover such judgment shall not be affected by
,'il /' ,q ""~'!II any entry or sale hereunder, or by the exercise of any other right, power or remedy for the
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':\ proceeds of sale, as in this Mortgage provided, to the payment of the debt hereby secured, the
Mortgagee shall be entitled to enforce payment of, and tel receive a\l amounts then remaining due
and unpaid upon, the Note, and to enforce payment of all other charges, payments and COllts due
under this Mortgage, and shall be entitled to recover judgment for any portion of the debt
remaining unpaid, with interest at the Involuntary Rate, In case ofthe commencement of any case
asainst the Mortgagor under any applicable bankruptcy, insolvency, 01' other similar law now or
hereafter in effCl::t or any pwceedings for its reorganization or involving the liquidation of itl
assets, then the Mortgagee shall be entitled to prove the whole amount of principal and interest
due upon the Note to the full amount thereof, and all other payments, charges and costs due
under this Mortgage, without deducting therefrom any proceeds obtained from the sale of the
:":r:!,\'.!': , whole or any part of the Mortgaged Property, provided, however, that in no case shall the
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Mortgagee receive a greater amount than the sum of (i) such principal and interest and (II) such
other payments, charges and costs from the aggregate amount of the proceeds of the sale of the
Mortgaged Property and the distribution from the estate (If the Mortgagor,

(c) No recovery of any judgment by the Mortgagee and no levy of an

execution under any jUdgment upon the Mortgaged Property shall affect in any manner or to any
extent, the lien of thi" Mortgage upon the Mortgaged Property, or any part thereof, of any liens,
rights, powers or remedies of the Mortgagee hereunder, but such liens, rights. powers and
remedies of the Mortgagee shall continue unimpaired as before,

(d) Any money~ thus collected by the MortSllgee under this Section 2,03 shall
be applied by the Mortgagee in accordance with the provisions of subsection (d) of Section 2,02,
Section 2,04, After the happening of any Event of Default and immediately upon
the commencement of any action, suit or other legal proceedings by the Mortgagee to obtain
judgment for the principal of, or interest on, the Note, and all other Indebtedness and other sums
required to be paid by the Mortgagor pursuant to any plovision of this Mortgage, or of any other
nature in aid of the enforcement of the Note or of this Mortgage, the Mortgagor will (a) waive the
issuance and service of process and enter its voluntary appearance in such action, suit or
proc.eeding, and (b) consent to the appointment of a receiver or receivers of the Mortgaged
Property, or any part thereof, and of all the earnings, revenues, rents, issues, profits and income
thereof, After the happening of any Event of Default and during its continuance, or upon the
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commencement of any proceedings to foreclose this Mortgage or to enforce the specific
perfonnance hereof or in aid thereof or upon the commencement of any other judicial proceeding
to enforce any right of the Mortgagee, the Mortgagee shall be entitled, as a matter of right, if it
shall 80 elect, without the giving of notice to any othefparty and without regard to the adequacy
ur inadequacy of any security for the Ind~tedne8S1 forthwith either before or after declaring the
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unpaid prinoipal of the Note to be due and payable, to the ~ppointment of such a rccc1vcr or
receivel'S.

Section 2.05. Notwithstanding the appointment of any receiver, liquidator or

trustee of the MOMgftgor, or of any of its property, or of the MoMgaged Property or any pan
thereof, the Mortgagee shall be entitled to retain possession and control of aU Pl'operty now or
hereafter held under this Mortgage.

1 Section 2.06. No remedy herein conferred upon or reserved to the Mortgagee Is

1
.11 intended to be exclusive of any other remedy or remedies, and each and every such remedy shall
be cumulative, and shall be in addition to every other remedy given hereunder or now or hereafter
existing at law or in equity or by statute. No delay or omission of the MOMgagce to exercise any
right or power accruing upon any Event of Default shall impair any such right or power, or shall
be construed to be a waiver of any such Event of Default or any acquiescence therein; and every
power and remedy siven by this Mortgage to the Mortgagee may be exercised from timfl to time
as often as may be deemed expedient by the Mortgagee. Nothing in this Mortgage or in the Notc
shall affect the obligation of the Mortgagor to pay the principal of, and inteteston, the Note in the
manner and at the time and place therein respectively ey.pressed.

Section 2.07. 1'he Mortgagor will not Ilt any time insist up()n, or plead, or in any
manner whatever claim or take any benefit or advantage of any stay or extension or moratorium
law, any er<emption from execution or sale. of the Mortgaged Property or any part thereof,
wherever enacted, now or at any time hereafter in fOi ce, which may affect the covenants and
terms of performance of this Mortgage, nor claim, take or insist upon any benefit or advantagc of
any law now or hereafter in force providing for the valuation or appraisal of the Mortgaged
Property, or any part thereof, prior to any sale or sales thereof which may be made pursuant to
any provision herein, or pursuant to the decree, judgment or order of any court of compeh"'t
jurisdiction; nor, after any such sale or sales, claim or exercise any right under any statute
heretofore or hereafter enacted to redeem the property so sold or any part thcreof and the
Mortgagor hereby expressly waives all benefit or advantage of any such law or laws, and
cov~nants not to hinder, delay or impede the execution of any power Ilerein granted or delegated
to the Mortgagee, but to suffer and permit the execution of every power as though no such law or
\ "

laws had been made Of' enacted. The Mortgagor, for itself and all who may claim under it.
\','1 waives, to the extent that it lawfully may. all riSht to have the Mortgaged Property marshaled
.. \'. ',;, I upon any forec:losure hereof.
.. '. ;: ,',:'.'.::' ".J Section 2.08. During the continuance of any Event of Default, and pending the
'i,.,
exercise by the Mortgagee of its right to exclude the Mortgagor from all or any part of the
\, ,. Premises, the Mortgagor agrees te. pay the fair and reasonable rental value for the use and
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\ occupancy of the Mortgaged Property, or any part thereof that is in its possellsion, and upon
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default of any such payment, will vacate and surrender possession of the Mortgaged Property. or
any part thereof, to the Mortgagee or to a receiver, if any, and in default thereof may be evir.tcd
by any summary action or pr('ceeding for the recovery of possession of the Premises for non-
payment of rent, however designated.

20

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ARTICLE III

Miscellaneoul

Section 3,01. In the event anyone or mme of the provisions contained in this
Mortgage or in the Note shall for any reason be held to be Invalid, illegal or unenforctlable in any
respect, such invalidity, illegality or unenforceobility shall, at the option of the Mortgogee, not
affect any other provision of this Mortga8e, but this Mortgas" shall be construed u if such
invalid, illegal or unenforceable provision had never been contained herein or therein.

Section 3.02. Any notice, demand, statement, request, consent or other

communication made hereunder shall be in writing and delivered (i) personally, (II) mailed by
certified or registered mail, postage prepaid, return receipt requeste:i, or (iii) by depositing the
same with Federal Express or another reputable pri,,'ate courier service, postage prepaid, for next
business day delivery, to the pllrtiell at the address set forth below and shall be deemed given
when delivered personally, or four business days liner being placed in the United States mall, if
sent by certified or registered mail, or onc business day afier deposit with such private ,"ourier
service:

uta the Mortgagor, addressed as follows:

The Trump Organization

72S Fifth Avenue
New York, New York 10022
Attention: Donald J. TNmp

with a copy to:

Joseph Tah!, Esq.

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The Trump Organization
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72S Fifth Avenue
New York. New York 10022
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if to the Mortgagee, addressed as follows:
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, ,1 :;", . :', Blackacre Bridge Partners, L.P.

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9S0 Third Avenue, 17th Floor
New York, New York 10022
Attention: Mr. Jeffrey Citrin
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and

New Valley Corporation

100 S,B, Second Street
Miami, Florida 33131
Attention: Marc N. Bell, Esq.

with a copy to:

Edward J,., Harris, Jr., Esq.

Dreyer and Traub
101 Park Avenue
New York, 'New York 10178

Rejection or other refusal to accept or the inability to deliver because of changed address of which
no notice was given as herein required shllll be deemed to be receipt of the notice, demand or
request sent. By giving to the other party hereto at least fifteen (15) days' prior written notice
thereof in accordance with the provisions hereof. the parties hereto shall have the right trom time
to time to change theil' respective addresses and each shall have the right to specity as its addresa
'1'-' any other address within the United States of America,
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Section 3,03, V. henever in this Mortgage the glVlnS of notice by mail or

otherwise is required. the giving of such notice may be waived in writing by the person or persona
entitled to receive suctl notice.

Section l04. All of the grants, terms, conditions, provision!! and covenants of
this Mort,gage shall run with the land, shall be binding upon the Mortgagor and shall Inure to the
benefit of the Mortgagee, subsequcnt holders of this Mortgage and their respective successors and
assigns, For the purpose of this Mortgage, the term "Mortgagor" shall include and refer to the
[,,'
mort9agor named herein, any subscquent OWJ1CI' of the Mortgaged Property, or any part thereof.
and their respective heirs, executors, legal representatives, successors and assigns, If there is
more than one Mortgagor. all their undertakings hereunder shall be deemed joint and several.

Section lOS, The c:nforcement of this Mortgage shall be governed, construed and
interpreted by the laws of the State of New York. Nothing in this Mortgage, the Note or in any
other agreement between the Mortgagor and the Mortgagee shall require the Mortgagor to pay,
or the Mortgagee to accept, interest in an amount which would subject the Mortgagee to any
penalt)' or forfeiture under applicable law. In the event that the payment of any charges. fees or
other sums due hereunder or under the Note or any such other agreement, which are or could be
held to be in the naUre of interest and which would subject the Mortgagee to any penalty or
forfeiture under applicable law, then, hm1 fi\ru2, the obligations of the Mortgago~ to make such
payment shall be reduced to the highest rate authorized under applicable law. Should the

22

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Mortgagee receive rmy payment which is or would be in excess of the highest rate authorized
under law, such payment shall have been, and shall be deemed to have been, made in error, and
shall automaticall~1 be applied to reduce the outstanding balance of the Indebtedness,

Section 3,06, This Mortgage and all of the terms, covenants, provisions,
conditions and grants contained in this Mortgage cannot be altered, amended, waived, modified or
discharged orally, and no executory agreement shall be effective to modifY, waive or discharge, in
wholo or in pan, anything contained in this Mortgage unless it III in writing and signed by the
party agllinst whom enforcement of the modification, alteration. amendment, waiver or dischar80
is sou8ht,

Section 3.07. In addition and without limitation, to any other provision of this
Mortgage, the Mortgagor shall protect, indemnify and save harmless the Mortgagee and Its
successors and assigns, and each of the their agents, employees, officers and directors, from and
against all liabilities, obligations, claims, dalllages, penalties, causes of action, cants and expense
(including, without limitation, attorneys' fees and expenyes, whether within ur outside the judicial
proces!! Ilnd whether at the trial or the appellate level), imposed upon or incurred by or asserted
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against the Mortgagee, its successors or assigns, or any of their Rgents, employees, oftlcers or
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i",'lr~'!". ,:; directors, by reason of (ti) ownership of this Mortgage, the Mortgaged Property or any part
thereof or an>' interest therein; (b) any accident, injury to or death of any person or loss of or
damage to property occurring in, on or about the Mortgased Property or any part thereof or on
the adjoining sidewalks, curbs, parking areas, streets 01' ways; (c) any use, nonuse or condition in,
on or about, or possession, alteration, repair. operation, maintenance or management of, the
Mortg"sed Property or any part thereof or on the adjoining sidewalks, curbs, parking areas,
streets or ways; (d) any failure on the part of Mortgagor to perform or comply with any of ,the
terms of'this Mortgage; (e) any claim by brokers, finders or similar persons claiming to be entitled
to a commission in connection with any lease or other transaction involving the Mortgaged
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Pl'operty or any part thereof or any liability asserted against the Mortgagee with respect thereto;
"',' "~I ii' ,.'.",', "\11 or (f) any action, suit or proceeding commenced by or against the Mortgagee in connection with
this Mortgage. The foregoing amounts nhall be paid on demand by the Mortga8or, together with
interest thereon at the Involuntary Rate from the date of any such demand,

Section 3,08, This Mortgage may be executed in any number of counterparts, and
each of such counterparts shall for all purposes be deemed to be an originalj and all such
counterparts shall together constitute but one Ilnd the same mortgage,

,"::,,,',1',, Section 3,09, The information set forth on the cover hereof and the terms and
., conditions contained in the Note are hereby incorporated herein,

Section 3.10, All covenants hereof shall be construed as affording to the

Mortgagee rights additional to and not exclusive of the rights conferred under the provisions of
Sec,lon 2S4 and 273 of the Real Properly Law of the State of New York, .

Section 3. 11, At its sole cost and expense, the Mortgagor shall comply with all
federal, state and llXl8l laws, rules, regulations and orders with respect to the discharge and
, '1",.'

"''''''''''''''"",,',;' ,,,r.I,

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removal of hazardous or toxic wastes, pay immediately when due the cost of removal of any such
wastes, and keep the PremisCls free of any lien imposed pursuant to such laws, rules, regulations
and orders. In the event the Mortgagor fails to do so, after notice to the Mortgagor and the
cKpll'atlon of the earlier of (a) the applickble cure period under this MortgRge or (b) the cure
period permitted under the applicable law, rule, regulation or order, the Mortgagee may either
declare that an Event of Default has occurred pursuant to the termll of this Mortgage or cause the
Premises to be freed from the hazardous wastes or contaminants and the cost of the removal 3hall
become additional indebtedness secured by this Mortsage and shall become immediately due and
payable without n()tice and with interest thereon at the Involuntal)' Rate, The Mortgagor shall
give to the Mortgagee and its agents and its employees access to thCl Premises and hereby grants
to the MortgRgee an irrevocable license, effective upon expiration of the applicable cure period, to
remove the hazardous wastes or contaminants, The Mortgagee at its sole opdon may enter and
undertake to alleviate or cure any alleged or actual failure, default or neglect of the Mortgagor,
but the Mortgagee shall be under no obligation whatsoever to do fiO. The Mortgagor shall and
hereby agrees to indemnifY the Mortgagee and hold the Mortgage~~ harmless from and against all
loss, cost, damage and expense (including, without limitation, attorneys' fees and costs incurred in
the investigation, defense nnd settlement of claims) that the Mor1gllgee may incur as a result of or
in connection with the assertion agninst the Mortgagee of an)' chlim relating to the presence or
removal of any hazardous wllste or contaminant referred to in this paragrnph, or compliance with
any federal, state or local laws, rules, regulations or order's relating thereto, Notwithstanding
',/,,\1.,.,
anything to the contrary, the direct liability of (hll Mortgagor to the Mortgagee under this
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covenant shall survive any foreclosure or satisfaction of this Mortgage and any payment in full of
",'
\Y the Noto and the other Indebtedness.
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'ri' Section 3,12, The Mortgagor shall not install or permit to be installed in the
".' '. Premises, fliable asbestos or any substance containing asbestos and deemed hazardous by federal,
state or local laws, rules, regulations or orders respecting such material. With respect to any such
;:.':<, ,'ol' material currently present in the Premises, the Mortgagor shall promptly either (a) remove any
such material deemed hazardous and required to be removed or (b) otherwise comply with such
federal, state or local laws, rules, regulations or orders at the Mortgagor's expense, If the
Mortgagor shall fail to so remove or otherwise comply, the Mortgagee may, after notice to the
Mortgagor and the expiration of the earlier of (i) the applicable cure periud under this MortgRge
OL' (Ii) the cure period pennitted ul,der the applicable law, rule regulation or order, either declare
that an Event of Default has occurred pursuant to the tennE of this Mortgage or do whatever is
necessary to eliminate said substances from the Premises or oth~rwise comply with the applicable
law, rule, regulation or order and the cost thereof shall become additional indebtedness secured by
this Mortgage and shall become immediately due and payable without notice and with interest
thereon at the lnvoluntary Rate, The Mortgagor shall give to the Mortgagee and its agents and
employees access to the Premises and hereby grants to the Mortgagee an irrevocable license,
effective upon expiration of the applicable cure period, to remove said asbestos or substances,
The Mortgagee at its sole option may enter and undertake to alleviate or cure any alleged or
actual failure, default or neglect of the Mortgagor, but the Mortgagee shall be under no obligation
whatsoever to do so, The Mortgagor shall and hereby agrees to indemnify the Mortgagee and
hold the Mortgagee harmless from and against all loss, cost, damage and expense (including,
without limitation, attorneys' fees and costs incurred in the investigation, defense and settlement

24

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