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<br />Mortgage, Assignment of Rents,
<br />Security Agreement and Fixture Filing
<br />Page 3
<br />
<br />Agreement, the Project Loan Agreement, the Construction Continuing Covenant
<br />Agreement (as defined below), this Security Instrument and all other documents or
<br />instruments evidencing, securing or relating to the Loans (the “Financing Documents”).
<br />E. Pursuant to the Financing Documents, Borrower has covenanted, among other things, to
<br />make loan payments sufficient to pay when due the interest and principal payments on the
<br />Project Note, plus late fees, loan fees, exit fees and other amounts due thereon, in all
<br />instances at the times and in the amounts necessary to enable the Fiscal Agent, on behalf
<br />of the Governmental Lender, to pay all amounts payable with respect to the Funding Loan,
<br />when due, whether at maturity or upon prepayment (with premium, if applicable),
<br />acceleration or otherwise.
<br />F. The Borrower, the Initial Funding Lender and Merchants Capital Corp., an Indiana
<br />corporation, as servicer, have entered into that certain Note Purchase Agreement
<br />(Construction Continuing Covenant Agreement) dated as of the date hereof (together with
<br />any amendment thereto, the “Construction Continuing Covenant Agreement”),
<br />providing, among other things, certain conditions on which the Initial Funding Lender will
<br />originate and fund the Funding Loan to Governmental Lender and disburse the proceeds
<br />thereof to the Fiscal Agent, which proceeds of the Funding Loan will be used to fund the
<br />Project Loan and will be disbursed by the Fiscal Agent to Guaranty Commercial Title, Inc.
<br />(“Disbursing Agent”) for the benefit of the Borrower and will subsequently be disbursed
<br />by the Disbursing Agent pursuant to the Disbursing Agreement.
<br />G. The Notes will mature not later than ____________, 20__ (the “Maturity Date”), or such
<br />earlier date as set forth in the Notes.
<br />H. The Loans bear interest at a variable rate of interest as more fully set forth in the Financing
<br />Documents, except that during the period of and continuance of an Event of Default
<br />hereunder, the Loans shall bear interest at the Default Rate (as such term is defined in the
<br />Funding Loan Agreement); such rate as in effect from time to time pursuant to the
<br />Financing Documents is the “Interest Rate”.
<br />I. The Governmental Lender and the Initial Funding Lender have required, as a condition to
<br />entering into the Financing Documents, that the Borrower secure its obligations under the
<br />Project Note and the other Financing Documents by this Security Instrument.
<br />J. The Governmental Lender’s right, title and interest in and to this Security Agreement will
<br />be assigned to the Fiscal Agent pursuant to the Funding Loan Agreement and that certain
<br />Assignment of Security Documents dated as of December _____, 2024.
<br />WITNESSETH, that Borrower, in consideration of the Indebtedness (hereinafter
<br />described) and the sums advanced to Borrower in hand paid by Governmental Lender, receipt
<br />whereof is hereby acknowledged, does hereby MORTGAGE, ENCUMBER, GRANT,
<br />BARGAIN, SELL, TRANSFER, PLEDGE, CONVEY AND WARRANT UNTO LENDER,
<br />WITH POWER OF SALE AND RIGHT OF ENTRY AND POSSESSION, AND GRANTS TO
<br />LENDER A SECURITY INTEREST IN unto Governmental Lender, its successors and assigns
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