Mortgage Modification and Extension Agreement

MORTGAGE MODIFICATION AND EXTENSION AGREEMENT This form provides for both a modification of interest rate and extension of the loan term. THIS MORTGAGE MODIFICATION AND EXTENSION AGREEMENT (``Modification Agreement'') is dated as of this April 18, 2008 by and between John E. Borrower, a natural person (``Mortgagor'') having an office at 7788 Luckey Road, AnyCity, Ohio 44444 and XYZ Mortgage Corp, a Ohio corporation having an office at 8899 BigLoan Alley, Anycity, Ohio 44444 (``Mortgagee''). WITNESSETH: WHEREAS, the Mortgagor is the owner in fee simple of the entire premises known as 9999 AnyAddress Rd, AnyCity, Ohio 44444 and more particularly described in Schedule A hereto (the ``Premises''); and WHEREAS, the Mortgagee has loaned to Mortgagor the sum of $ 525,000.00, which loan is evidenced by Mortgagor's mortgage note, dated 19th day of February, 2004, in the principal amount of $ 525,000.00 (the ``Mortgage Note''); and WHEREAS, the obligations of Mortgagor under the Mortgage Note and other obligations of Mortgagor to Mortgagee are secured by that certain Mortgage Agreement dated the 19th day of February, 2004 between Mortgagor and Mortgagee and recorded on February 20, 2004 in Book Volume 897 of Mortgages, Page 2233 in the Office of the County Recorder/Register of the County of Cuyahoga, State of Ohio (the ``Mortgage''); and WHEREAS, the parties desire to extend the term of the Mortgage Note and modify the rate of interest to accrue on the outstanding principal balance of the Mortgage Note; and WHEREAS, the parties desire that the Mortgage be amended by this Modification Agreement for the purpose of giving public notice that all payment and performance obligations under the Mortgage Note as amended by this Modification Agreement. NOW, THEREFORE, the parties agree as follows: A. The Mortgage is and as amended hereby shall remain a valid first lien against the Premises and all buildings, improvements, fixtures and articles of personal property now or hereafter affixed to, placed upon or used in connection with the operation of the premises and the proceeds thereof, all of which are covered by the Mortgage. B. The time of payment of the unpaid principal indebtedness evidenced by the Mortgage Note and secured by the mortgage is hereby extended to April 1, 2034. C. The outstanding principal indebtedness remaining under the Mortgage Note shall bear interest from the date hereof until paid in full at a rate per annum equal to the lower of (i) 5.25 percent or (ii) the highest rate permitted by law. Interest shall be payable in accordance with the terms and provisions of the Mortgage Note. D. The security of the Mortgage shall not be impaired by anything herein contained and 1 all terms and provisions of the Mortgage continue in full force and effect except as modified in this Modification Agreement. AND the Mortgagor covenants with the Mortgagee as follows: 1.00. That the Mortgagor will pay the indebtedness as hereinbefore provided. 2.00. That the Mortgagor will keep the buildings on the Premises insured against loss by fire for the benefit of the Mortgagee; that it will assign and deliver the policies to the Mortgagee; and that it will reimburse the Mortgagee for any premiums paid for insurance made by the Mortgagee on the Mortgagor's default in so insuring the buildings or in so assigning and delivering the policies. Mortgagee agrees that replacement value shall be deemed sufficient insurance. 3.00. That no building on the Premises shall be substantially altered, removed or demolished without the consent of the Mortgagee. 4.00. That the whole of said principal sum and interest shall become due at the option of the Mortgagee: after default in the payment of any tax, water rate, sewer rent or assessment for thirty days after notice and demand; or after default after notice and demand either in assigning and delivering the policies insuring the buildings against loss by fire or in reimbursing the Mortgagee for premiums paid on such insurance, as hereinbefore provided; or after default upon request in furnishing a statement of the amount due on the mortgage and whether any offsets or defenses exist against the mortgage debt, as hereafter provided; or after default has occurred under any other mortgage on the said Premises. An assessment which has been made payable in installments at the application of the Mortgagor or lessee of the Premises shall nevertheless, for the purpose of this paragraph, be deemed due and payable in its entirety on the day the first installment becomes due or payable or a lien. 5.00. That the holder of this mortgage, in any action to foreclose it, shall be entitled to the appointment of a receiver. 6.00. That the Mortgagor will pay all taxes, assessments, sewer rents or water rates, and in default thereof, the Mortgagee may pay the same. 7.00. That the Mortgagor within five days upon request in person or within ten days upon request by mail will furnish a written statement duly acknowledged of the amount due on this mortgage and whether any offsets or defenses exist against the mortgage debt. 8.00. That notice and demand or request may be in writing and may be served in person or by mail. 9.00. That the Mortgagor warrants the title to the Premises. 10.00. That in case of a foreclosure sale, said Premises, or so much thereof as may be affected by this mortgage, may be sold in one or more parcels and Mortgagor hereby waives the right, if any, to require any sale to be made in parcels, or the right, if any, to select parcels to be sold, and there shall be no requirement for marshaling of assets. 11.00. That if any action or proceeding be commenced (except an action to foreclose this 2 mortgage or to collect the debt secured thereby), to which action or proceeding the Mortgagee is made a party, or in which it becomes necessary to defend or uphold the lien of this mortgage, all sums paid by the Mortgagee for the expense of any litigation to prosecute or defend the rights and lien created by this mortgage (including reasonable counsel fees), shall be paid by the Mortgagor, together with interest thereon at the rate of twelve percent, per annum, and any such sum and the interest thereon shall be a lien on said Premises, prior to any right, or title to, interest in or claims upon said Premises attaching or accruing subsequent to the lien of this mortgage, and shall be deemed to be secured by this mortgage. In any action or proceeding to foreclose this mortgage, or to recover or collect the debt secured thereby, the provisions of law respecting the recovering of costs, disbursements and allowances shall prevail unaffected by this covenant. 12.00. That the Mortgagor hereby assigns to the Mortgagee the rents, issues and profits of the Premises as further security for the payment of said indebtedness, and the Mortgagor grants to the Mortgagee the right to enter upon and take possession of the Premises for the purpose of collecting the same and to let the Premises or any part hereof, and to apply the rents, issues and profits, after payment of all necessary charges and expenses, on account of said indebtedness. 1 3 This assignment and grant shall continue in effect until this mortgage is paid. The Mortgagee hereby waives the right to enter upon and take possession of said Premises for the purpose of collecting said rents, issues and profits, and the Mortgagor shall be entitled to collect and receive said rents, issues and profits until default under any of the covenants, conditions or agreements contained in this mortgage, and agrees to use such rents, issues and profits in payment of principal and interest becoming due on this mortgage and in payment of taxes, assessments, sewer rents, water rates and carrying charges becoming due against said Premises, but such right of the Mortgagor may be revoked by the Mortgagee upon any default, on five days' written notice. The Mortgagor will not, without the written consent of the Mortgagee, receive or collect rent from any tenant of said Premises or any part thereof for a period of more than one month in advance, and in the event of any default under this mortgage will pay monthly in advance to the Mortgagee, or to any receiver appointed to collect said rents, issues and profits, the fair and reasonable rental value for the use and occupation of said Premises or of such part thereof as may be in the possession of the Mortgagor, and upon default in any such payment will vacate and surrender the possession of said Premises to the Mortgagee or to such receiver, and in default thereof may be evicted by summary proceedings. 13.00. That the whole of said principal sum and the interest shall become due at the option of the Mortgagee: (a) in the event Mortgagor fail to pay any installment of principal or interest when due and payable under the Mortgage Note; or (b) after failure to exhibit to the Mortgagee, within ten days after demand, receipts showing payment of all taxes, water rates, sewer rents and assessments; or (c) after the actual or threatened alteration, demolition or removal of any building on the Premises without the written consent of the Mortgagee; or (d) after the assignment of the rents of the Premises or any part hereof without the written consent 3. See Donahue and Edwards, The Treatment of Assignments of Rents in Bankruptcy: Emerging Issues Relating to Perfection, Cash Collateral, and Plan Confirmation, 48 Bus. Law. 633-698 (February 1993), for an in-depth discussion concerning the use of assignment of rents clauses. 3 of the Mortgagee; or (e) if the buildings on said Premises are not maintained in reasonably good repair; or (f) after failure to comply with any requirement or order or notice of violation of law or ordinance issued by any governmental department claiming jurisdiction over the Premises within three months from the issuance thereof; or (g) if on application of the Mortgagee two or more fire insurance companies lawfully doing business in the State of Ohio refuse to issue policies insuring the buildings on the Premises; or (h) in the event of the removal, demolition or destruction in whole or in part of any of the fixtures, chattels or articles of personal property covered hereby, unless the same are promptly replaced by similar fixtures, chattels and articles of personal property at least equal in quality and condition to those replaced, free from chattel mortgages or other encumbrances thereon and free from any reservation of title thereto; or (i) after thirty days' notice to the Mortgagor, in the event of the passage of any law deducting from the value of land for the purpose of taxation any lien thereon, or changing in any way the taxation of mortgages or debts secured thereby for state or local purposes; or (j) if the Mortgagor fails to keep, observe and perform any of the other covenants, conditions or agreements contained in this Mortgage. 14.00. The Mortgagor, ten (10) day upon written request by mail, will furnish a duly acknowledged written statement setting forth the amount of the debt secured by this mortgage and stating either that no offsets or defenses exist against the mortgage debt or, if such offsets or defense are alleged to exist, the nature thereof. 15.00. Should the holder hereof commence any action of foreclosure by reason of any default beyond all applicable grace and cure periods hereunder, such holder shall thereupon become entitled to, and the Mortgagor and/or other owner of the mortgaged Premises agrees to pay the sum of equal to fifteen (15%) percent of the amount of the mortgage due and owing at the time of default towards attorney's fees and expenses in connection with said foreclosure action in addition to and apart from the usual costs and allowances to which the holder hereof may be entitled or awarded under any law or statute applicable to such action. 16.00. In the event of any default herein beyond all applicable grace and cure periods the holder of this mortgage may, at the holder's option, with notice, make or cause to be made a so-called foreclosure search in preparation for the institution of a foreclosure action and take such steps as may be necessary and desirable for that purpose and the expense so incurred for such purpose or purposes shall become part of the indebtedness secured by this Mortgage; and whether such foreclosure is actually instituted and carried to judgment, or is not instituted at all, or after having been instituted is discontinued, the expense so incurred in connection therewith may be added by the holder of this Mortgage to the indebtedness secured by the said mortgage, and shall, at the option of the holder of this mortgage, become due and payable forthwith. 17.00. In order to more fully protect the security of this Mortgage and to insure the payment of real estate taxes, the Mortgagor agrees, in the event of default hereunder which continues beyond all applicable grace and cure periods and at the option of the Mortgagee, to pay to the Mortgagee a sum equal to one-twelfth (1/12th) of the annual real estate taxes, on the day of the month on which all installments of principal and interest on this mortgage shall be payable, together with such monthly installments of principal and interest. The Mortgagor shall also pay to the Mortgagee such additional amounts as may be determined by the Mortgagee 4 from time to time in order to provide the Mortgagee with a fund at least thirty (30) days prior to the due date for the payment of the next installment of such taxes, sufficient to pay said installments. If on a date thirty (30) days prior to the due date for the payment of any of said items there shall be insufficient funds on hand with the Mortgagee to pay the same, Mortgagor shall forthwith make a deposit sufficient to make payment of same in full when due. It is the intention of the parties that the Mortgagor shall deposit with the Mortgagee the necessary funds so that the Mortgagee, at all times during the term of this mortgage and any extension thereof, shall have on hand sufficient deposits covering the various items for the respective accrual periods pertaining to each of them so that the deposits of one shall not be used for the payment of another, except, however, that the Mortgagee at its option may use the deposits of one for the payment of another and any resulting deficiency shall forthwith be paid by the Mortgagor. The said funds shall bear no interest. The whole of said mortgage debt shall immediately become due and payable at the option of the holder of this mortgage after default in the payment of any of the aforesaid monthly deposits for thirty (30) days or after default in payment of any of the aforesaid additional sums or deposits for thirty (30) days, in which event all monies on hand in the deposit fund may, at the option of the holder of this mortgage, be applied in reduction of the mortgage and/or in the payment of any of the aforesaid items. Upon an assignment of this mortgage, the Mortgagee shall have the right to pay over the balance of such deposits in its possession to the assignee and the Mortgagee shall thereupon be completely released from all liability with respect to such deposits and the Mortgagor or owner of the Premises shall look solely to the assignee or transferee in reference thereto. This provision shall apply to every transfer of such deposits to a new assignee. Mortgagor agrees to promptly provide Mortgagee with proof of payment hereunder. The Mortgagee may demand and collect deposits for any one or more of the above items without demanding or collecting deposits for all of the above items. 18.00. In the event that any payment, or any deposit for real estate taxes, is not paid within seventeen (17) days of the date due herein, a late charge of no (0 4) cents for each dollar so overdue shall become immediately due to the Mortgagee as liquidated damages for failure to make prompt payment and the same shall be secured by this Mortgage. Such charge shall be payable in any event no later than the due date of the next subsequent installment or at the option of the holder of this mortgage, may be deducted from any deposits held by the said Mortgagee for the payment of real estate taxes, water rates, sewer rents and insurance premiums. Nothing herein is intended to or shall extend the due dates set forth for payments under this Mortgage. 19.00. After maturity, stated or accelerated, interest shall accrue at the rate of seven (7.25 %) percent per annum, but this provisions shall not constitute an extension of time for the payment of the balance of principal. 20.00. Upon any default beyond all applicable grace and cure periods of the Mortgagor in complying with or performing any warranty or covenant herein, the Mortgagee may, at the Mortgagee's option, after notice, comply with or perform the same, and the cost thereof together with interest thereon at the rate of twelve (12%) per cent per annum shall be paid by the Mortgagor to the Mortgagee on demand and shall be secured by this Mortgage. 21.00. If the Mortgagee employs an attorney to collect any or all of the unpaid 5 indebtedness hereof or to enforce any other provision hereof, other than for the purposes of foreclosure which are otherwise provided for herein, the Mortgagee, in addition to all other costs and fees allowed according to law, shall be reimbursed by the Mortgagor immediately for all reasonable costs and attorney's fees incurred by the Mortgagee and the same shall be secured by this Mortgage. 22.00. Any agreement hereafter made modifying the terms of this Mortgagee shall be superior to the rights of the holders of any intervening liens or encumbrances. 23.00. The Mortgagee, at its option, at intervals of not less than one (1) year, may procure tax, water, sewer, assessment and/or Building Department searches on the mortgaged Premises for which the Mortgagor shall be charged $5.00, or said charge may be deducted from any deposits held by the Mortgagee hereunder. 24.00. The Mortgagee may, at Mortgagee's option, foreclose this mortgage for any portion of the debt or any other sums secured hereby which are then in default beyond all applicable grace and cure periods, subject to the continuing lien of this Mortgage for the balance of the mortgage debt not then due. In the event the Mortgagor is the subject of any insolvency, bankruptcy, receivership, dissolution, reorganization or similar proceeding, federal or state, voluntary or involuntary, under any present or future law or act, Mortgagee is entitled to the automatic and absolute lifting of any automatic stay as to the enforcement of its remedies under this Mortgage against the Premises, including specifically, but not limited to the stay imposed by Section 362 of the United States Bankruptcy Code, as amended; Mortgagor hereby consents to the immediate lifting of any such automatic stay and will not contest any motion by Mortgagee to lift such stay; Mortgagor expressly acknowledges that (a) there is no equity in the Premises after consideration of the amounts owed Mortgagee and (b) the Premises is not now, and will never be necessary to any plan of reorganization of any type. 25.00. In the event of the foreclosure of this mortgage, a judgment obtained in such foreclosure action shall, in addition to all other rights and remedies of the Mortgagee, be enforceable against the interest of the Mortgagor in the premiums or proceeds of any insurance policies covering or related to the Premises, any awards payable in connection with any condemnation of the Premises or any part thereof, prepaid taxes, real estate tax refunds, rents receivable from tenant and occupants of the Premises or any part thereof, and any other rights, privileges, licenses, franchises, claims, causes of action or other interests, sums, or receivables appurtenant to the Premises. 26.00. In the event of any transfer of title to the mortgaged Premises, the entire unpaid principal balance shall forthwith become due and payable to the extent provided in the Mortgage Note secured by this Mortgage. 27.00. In the event that the Mortgagor or any subsequent owner of the Premises shall fail to supply the Mortgagee with an endorsement of a binding fire insurance policy recognizing the Mortgagee as an interested party, the Mortgagee shall be entitled to place fire insurance on the Premises for its benefit. The premium therefor shall be paid by the Mortgagor or then owner of the Premises. Upon failure of the Mortgagor to pay such premium within thirty (30) days after written demand, at the option of the Mortgagee, the whole of said principal sum and interest hereunder shall become due and payable. 6 28.00. The Premises shall be maintained in good condition and may not be structurally altered without the prior written consent of the Mortgagee. Structural alterations without such consent shall be deemed a default. Said consent shall not be unreasonably withheld provided such alteration is in compliance with all applicable governmental requirements and, as determined in the sole discretion of the Mortgagee, does not diminish the value of the property. 29.00. The Mortgagor may not further encumber the mortgaged Premises without the prior written consent of the Mortgagee or other holder of this Mortgage. 30.00. That the validity and enforceability of this mortgage and all transactions and questions arising hereunder, shall be construed and interpreted according to the laws of the State of Ohio. Wherever possible, each provision of this mortgage shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this mortgage shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remaining provisions of this mortgage. Nothing in this Mortgage or the Mortgage Note secured by this Mortgage, shall require the Mortgagor to pay, or the Mortgagee to accept, interest in an amount which would subject the Mortgagee to penalty under applicable law. In the event that the payment of any interest due hereunder or under the Mortgage Note secured hereby or any such other agreement would subject the Mortgagee to penalty under applicable law, then, ipso facto, the obligation of the Mortgagor to make such payment shall be reduced to the highest rate authorized under applicable law without penalty. Anything paid by Mortgagor above the rate of usury shall be applied to principal. 31.00. The rights of the Mortgagee under this Mortgage shall be separate, distinct and cumulative and none shall be given effect to the exclusion of the other and such rights may be exercised singly or concurrently. No act of the Mortgagee shall be construed as an election to proceed under any one provision herein to the exclusion of any other provision or any other remedy Mortgagee may have. 32.00. No act, delay, omission or course of dealing between Mortgagor and Mortgagee shall be a waiver of any of the Mortgagee's rights or remedies under this Mortgage, and no waiver, change, modification or discharge in whole or in part of this mortgage or of any obligation will be effective unless in writing signed by the Mortgagee. A waiver by the Mortgagee of any rights or remedies under the terms of this Mortgage or the mortgage note or with respect to any obligation, on any occasion will not be a bar to the exercise of any right or remedy on any subsequent occasion. 33.00. This Mortgage is both a Real Property Mortgage and a Security Agreement. The Premises includes both real and personal property and all other rights and interests, whether tangible or intangible in nature, owned by the Mortgagor in the Premises. 34.00. The Mortgagor hereby grants to the Mortgagee a security interest in all of the Mortgagor's present and future ``equipment'' and ``general intangibles'' located at or used in connection with the Premises (as said quoted terms are defined in the Uniform Commercial Code of the State wherein the Premises is located) and the Mortgagee shall have, in addition to all rights and remedies provided herein, and in any other agreements, commitments and undertaking made by the Mortgagor to the Mortgagee, all of the rights and remedies of a 7 ``secured party'' under the said Uniform Commercial Code. To the extent permitted under applicable law, this Mortgage shall be deemed to be a ``Security Agreement'' (as defined in the aforesaid Uniform Commercial Code). If the lien of this mortgage is subject to a security interest covering any such personal property, then all such property is hereby assigned to the Mortgagee, together with the benefits of all deposits and payments now or hereafter made thereon by the Mortgagor. 35.00. The Mortgagor shall not be entitled to receive any credit for any set-off against payments due and payable hereunder and shall not make any set-off, without the express written consent of the Mortgagee. The Mortgagor hereby waives any defense other than payment, and waives any right to set-off by way of damages, recoupment or counterclaim in damages, whether arising out of this mortgage or the bond or note or otherwise, which Mortgagor may otherwise be entitled to receive in any action commenced by the Mortgagee by reason of the Mortgagor's default under the terms of this Mortgage or the note or bond secured hereby, whether such action be an action to foreclose or an action under the bond or note. The Mortgagor shall have an independent action for such claim and such independent action shall not at any time be joined or consolidated with any action commenced by the Mortgagor under this Mortgage or the bond or note secured hereby. 36.00. The Mortgagor shall have the right to prepay the whole or any part of the unpaid principal balance of the indebtedness hereunder at any time and from time to time hereafter in multiples of $1,000.00 on thirty (30) days notice in writing. 37.00. This Mortgage may not be changed or terminated orally. The covenants contained in this mortgage shall run with the land and bind the Mortgagor, the heirs, personal representatives, successors and assigns of the Mortgagor and all subsequent owners, encumbrancers, tenants and subtenants of the Premises, and shall enure to the benefit of the Mortgagee, the personal representatives, successors and assigns of the Mortgagee and all subsequent holders of this mortgage. The word ``Mortgagor'' shall be construed as if it read ``Mortgagors'' and the word ``Mortgagee'' shall be construed as if it read ``Mortgagees'' whenever the sense of this mortgage so requires. 38.00. Mortgagee may release, regardless of consideration and without the necessity for any notice to or consent by the holder of any subordinate lien on the Premises, any part of the security held for payment of the indebtedness or any portion thereof or for the performance of the obligations secured by this Mortgage without, as to the remainder of the security, in any manner whatsoever, impairing or affecting the lien of this Mortgage or the priority of the lien of this Mortgage over any subordinate lien. IN WITNESS WHEREOF, this mortgage has been duly executed by the Mortgagor. By: ___________________________ Name: { insert agent's name here } Title: {insert Agent's title here } 8 Acknowledged by: _______________________________ Elmer Fudd 9