Mortgage Agreement - Maine

MORTGAGE AND SECURITY AGREEMENT (MAINE)

TABLE OF CONTENTS

1. Article I – Definitions
2. Article II – Grant of Mortgage & Security Interest
3. Article III – Indebtedness Secured
4. Article IV – Representations & Warranties
5. Article V – Covenants
6. Article VI – Events of Default & Remedies
7. Article VII – Risk Allocation
8. Article VIII – Dispute Resolution
9. Article IX – General Provisions
10. Article X – Execution & Acknowledgment
11. Exhibit A – Legal Description of the Mortgaged Property
12. Exhibit B – Permitted Liens (if any)

DOCUMENT HEADER

This Mortgage and Security Agreement (this “Mortgage”) is made as of [EFFECTIVE DATE] (the “Effective Date”) by and between [MORTGAGOR NAME], a [STATE OF FORMATION & ENTITY TYPE / individual] (“Mortgagor”), whose mailing address is [ADDRESS], and [MORTGAGEE NAME], a [STATE OF FORMATION & ENTITY TYPE] (“Mortgagee”), whose mailing address is [ADDRESS].

RECITALS

A. Mortgagor is indebted to Mortgagee pursuant to that certain Promissory Note dated the Effective Date in the original principal amount of [${SECURED DEBT AMOUNT}] (the “Note”).
B. To secure the Note and the other Obligations (as defined below), Mortgagor has agreed to grant Mortgagee a first-priority mortgage lien on the real property described in Exhibit A (the “Mortgaged Property”) together with all Improvements, Fixtures, Rents, and Personal Property as set forth herein.

For valuable consideration, the receipt and sufficiency of which are acknowledged, the parties agree as follows:

ARTICLE I – DEFINITIONS

1.01 “Applicable Law” means all federal, state, and local statutes, laws, ordinances, codes, regulations, rules, and orders applicable to the Mortgaged Property or the transactions contemplated herein, including without limitation 14 M.R.S. §§ 6321–6326 (judicial foreclosure by civil action) and 4 M.R.S. §§ 1901–1933 (Revised Uniform Law on Notarial Acts).
1.02 “Debt” has the meaning given in Article III.
1.03 “Default Rate” means [PERCENT %] per annum or, if less, the maximum rate permitted by Applicable Law.
1.04 “Event of Default” has the meaning set forth in Section 6.01.
1.05 “Improvements” means all buildings, structures, fixtures, and other improvements now or later located on the Mortgaged Property.
1.06 “Obligations” means the Debt and every other obligation of Mortgagor to Mortgagee under the Loan Documents.
1.07 “Permitted Liens” means only those liens identified on Exhibit B.
1.08 “Personal Property” means all equipment, goods, inventory, general intangibles, and other personal property now or later located on or used in connection with the Mortgaged Property, whether or not physically affixed.
1.09 “Rents” means all present and future rents, revenues, issues, income, and profits arising from the Mortgaged Property.

ARTICLE II – GRANT OF MORTGAGE & SECURITY INTEREST

2.01 Grant. Mortgagor hereby MORTGAGES, GRANTS, BARGAINS, SELLS, CONVEYS, and ASSIGNS to Mortgagee, with MORTGAGE COVENANTS, and grants a security interest under the Uniform Commercial Code in, the Mortgaged Property, together with:
a. all Improvements and Fixtures;
b. all Rents;
c. all Personal Property; and
d. all proceeds thereof (collectively, the “Collateral”).

2.02 Nature of Estate. This grant constitutes (i) a mortgage lien on real property under Maine law, and (ii) a security agreement under Article 9 of the UCC.

2.03 Future Advances. This Mortgage secures not only existing indebtedness but also future advances up to the Maximum Secured Amount of [${SECURED DEBT AMOUNT}] plus interest, costs, and protective advances, whether or not contemplated as of the Effective Date.

ARTICLE III – INDEBTEDNESS SECURED

3.01 Debt. The indebtedness secured hereby (the “Debt”) includes:
a. principal, interest, and all other sums payable under the Note;
b. all protective advances, escrow advances, and costs of enforcement;
c. all amounts arising under any swap, hedge, credit enhancement, or reimbursement agreement related to the Note; and
d. all renewals, extensions, modifications, consolidations, and replacements of any of the foregoing.

3.02 Liability Cap. Mortgagee’s recovery is contractually limited to the Collateral and any deficiency judgment permitted under 14 M.R.S. § 6324, not to exceed the then-outstanding Debt. Nothing herein expands Mortgagor’s personal liability beyond the Debt.

ARTICLE IV – REPRESENTATIONS & WARRANTIES

4.01 Organization & Authority. Mortgagor is duly organized, validly existing, and in good standing under the laws of its jurisdiction of formation and has full power to execute and deliver this Mortgage.
4.02 Title. Mortgagor holds marketable fee simple title to the Mortgaged Property, subject only to Permitted Liens.
4.03 No Conflicts. Execution and performance of this Mortgage do not violate Mortgagor’s organizational documents or any contractual or legal obligations.
4.04 Compliance with Laws. The Mortgaged Property and its current uses comply in all material respects with Applicable Law.
4.05 Environmental Matters. No Hazardous Materials are present in, on, or under the Mortgaged Property in violation of Applicable Law.
4.06 Survival. The representations and warranties survive recordation of this Mortgage and any foreclosure sale.

ARTICLE V – COVENANTS

5.01 Payment & Performance. Mortgagor shall (i) pay the Debt when due, and (ii) perform all Obligations.
5.02 Preservation of Property. Mortgagor shall maintain the Mortgaged Property in good repair, free of waste, and in compliance with Applicable Law.
5.03 Taxes & Assessments. Mortgagor shall pay before delinquency all taxes, assessments, and governmental charges affecting the Mortgaged Property.
5.04 Insurance. Mortgagor shall maintain all-risk property insurance and liability insurance with carriers and coverages reasonably acceptable to Mortgagee, naming Mortgagee as mortgagee and loss payee.
5.05 Negative Covenants. Without Mortgagee’s prior written consent, Mortgagor shall not (i) create or permit any lien on the Collateral other than Permitted Liens, (ii) transfer any interest in the Mortgaged Property, or (iii) cease operations or dissolve.
5.06 Books & Records; Inspection. Mortgagor shall keep accurate books and permit Mortgagee to inspect the Mortgaged Property and such records on reasonable notice.
5.07 Notice of Material Events. Mortgagor shall notify Mortgagee promptly of any Event of Default, litigation, or material adverse change.

ARTICLE VI – EVENTS OF DEFAULT & REMEDIES

6.01 Events of Default. Each of the following is an “Event of Default”:
a. Failure to pay any amount under the Note or any Loan Document when due;
b. Breach of any other covenant or agreement, continuing for 30 days after written notice (10 days for insurance or taxes);
c. Any representation or warranty proves materially false;
d. Insolvency, bankruptcy, or assignment for the benefit of creditors by Mortgagor;
e. Material impairment of the Collateral or Mortgagee’s security interest.

6.02 Remedies. Upon an Event of Default and expiration of any applicable cure period, Mortgagee may, at its option and without further demand:
a. Accelerate the Debt after any notice and cure period required by law and the Loan Documents. Section 6111's 35-day written right-to-cure notice applies to a mortgage on residential property occupied in whole or part as the mortgagor's primary residence, securing a personal, family, or household loan, when enforcement is based on a covered loan, tax, or insurance-premium payment default; it does not supply a general 35-day period for every default;
b. Institute judicial foreclosure by civil action pursuant to 14 M.R.S. § 6321 in the Superior Court or District Court for the division in which the Mortgaged Property is located. This Mortgage grants no power of sale. Maine also permits a power-of-sale procedure under 14 M.R.S. § 6203-A for a qualifying mortgage granted by a corporation, partnership, limited liability company, or trustee of a trust when that mortgage contains a power of sale and satisfies the statute's other conditions;
c. Seek possession of the Mortgaged Property and collect Rents, subject to the limitations on writs of possession in 14 M.R.S. § 6322;
d. Apply for appointment of a receiver;
e. Exercise any and all UCC remedies with respect to Personal Property; and
f. Pursue a deficiency judgment as permitted by, and subject to the limitations of, 14 M.R.S. § 6324.

6.03 Foreclosure Mediation. If the Mortgaged Property is owner-occupied residential real property of no more than four units that is the primary residence of the Mortgagor, Mortgagee shall attach to the foreclosure complaint the one-page notice required by 14 M.R.S. § 6321-A, and, if Mortgagor requests mediation or otherwise appears in the action, the parties shall participate in the court-annexed Foreclosure Diversion (mediation) Program established under that section prior to entry of a judgment of foreclosure and sale.

6.04 Redemption and Sale. Upon entry of a judgment of foreclosure and sale, Mortgagor’s statutory right of redemption continues for 90 days after entry of judgment (or one year after judgment for mortgages executed before October 1, 1975, unless the mortgage provides otherwise), running from entry of judgment provided no appeal is taken, all as set forth in 14 M.R.S. § 6322. If Mortgagor does not redeem by paying the adjudged amount within the redemption period, Mortgagor’s right to possession terminates and Mortgagee shall proceed to a public sale of the Mortgaged Property, with notice published and conducted in accordance with 14 M.R.S. § 6323. Redemption under this Mortgage occurs, if at all, before the public sale, not afterward.

6.05 Application of Proceeds. Proceeds of any public sale conducted under Section 6.04, or of any other disposition of the Collateral, shall be applied (i) to costs of sale, (ii) to the Debt in such order as the judgment of foreclosure directs or as Mortgagee determines, and (iii) any surplus to the party entitled thereto, in each case consistent with 14 M.R.S. § 6324.

6.06 Attorney Fees. Mortgagor shall pay all reasonable attorney fees, costs, and expenses incurred by Mortgagee in enforcing or protecting its rights, whether or not suit is filed.

ARTICLE VII – RISK ALLOCATION

7.01 Indemnification. Mortgagor shall indemnify, defend, and hold Mortgagee and its affiliates harmless from and against all claims, liabilities, losses, and expenses (including attorney fees) arising out of (i) ownership, use, or condition of the Mortgaged Property, (ii) violation of Applicable Law, or (iii) any misrepresentation by Mortgagor. This indemnity survives satisfaction or foreclosure of this Mortgage.
7.02 Limitation of Liability. Except for Mortgagor’s indemnity and for any waste or fraud, recourse against Mortgagor is limited to the Collateral and any deficiency judgment expressly permitted by Article VI.
7.03 Force Majeure. Performance by Mortgagor (other than payment obligations) shall be excused during, and extended for, any period of Force Majeure, defined as acts beyond reasonable control, provided Mortgagor gives prompt notice and diligently resumes performance.

ARTICLE VIII – DISPUTE RESOLUTION

8.01 Governing Law. This Mortgage, the Note, and the other Loan Documents are governed by the laws of the State of Maine, without regard to conflict-of-laws principles.
8.02 Forum Selection. Each party submits to the exclusive jurisdiction of the state courts located in [COUNTY], Maine, for any action arising out of or relating to the Loan Documents.
8.03 Arbitration. The parties expressly exclude arbitration; disputes shall be resolved exclusively in the courts specified in Section 8.02.
8.04 Jury Waiver. To the fullest extent permitted by Maine law, each party knowingly and voluntarily waives trial by jury in any action or proceeding arising out of the Loan Documents.
8.05 Injunctive Relief. Nothing herein limits Mortgagee’s right to seek equitable or injunctive relief, including but not limited to foreclosure, appointment of a receiver, or specific performance.

ARTICLE IX – GENERAL PROVISIONS

9.01 Amendments & Waivers. No amendment or waiver is effective unless in writing signed by the party to be charged. No waiver extends to any subsequent breach.
9.02 Assignment. Mortgagee may assign this Mortgage and the Debt without notice to Mortgagor. Mortgagor may not assign any rights without Mortgagee’s prior written consent.
9.03 Successors & Assigns. This Mortgage binds and benefits the parties and their respective successors and permitted assigns.
9.04 Severability. If any provision is unenforceable, it shall be deemed modified to the minimum extent necessary to render it enforceable, and the remainder of this Mortgage shall remain in effect.
9.05 Integration. The Loan Documents collectively constitute the entire agreement and supersede all prior understandings relating to the subject matter.
9.06 Counterparts; Electronic Signatures. This Mortgage may be executed in counterparts, each of which is an original, and all of which together constitute one instrument. Signatures delivered by electronic means are deemed original and binding.
9.07 Notices. Any notice shall be in writing and deemed given when delivered personally, sent by nationally recognized overnight courier, or deposited in U.S. certified mail, return receipt requested, to the addresses set forth above (or as updated by notice).
9.08 Recording. Mortgagor shall pay all recording taxes, fees, and charges and cause this Mortgage to be promptly recorded in the [COUNTY] Registry of Deeds.
9.09 Further Assurances. Mortgagor shall execute and deliver such additional documents and take such further actions as Mortgagee may reasonably request to perfect and continue the lien and security interest granted herein.

ARTICLE X – EXECUTION & ACKNOWLEDGMENT

IN WITNESS WHEREOF, the parties have executed this Mortgage effective as of the Effective Date.

MORTGAGOR:

[ENTITY/INDIVIDUAL NAME]
By: _______________________________
Name: _____________________________
Title: _____________________________
Date: _____________________________

MORTGAGEE:

[ENTITY NAME]
By: _______________________________
Name: _____________________________
Title: _____________________________
Date: _____________________________

NOTARY ACKNOWLEDGMENT – STATE OF MAINE

State of Maine
County of [________________________________] ss.

On this ___ day of __________, 20__, before me, the undersigned Notary Public (or other notarial officer authorized under 4 M.R.S. § 1910), personally appeared ________________________, personally known to me or proved to me through satisfactory evidence of identification to be the person whose name is subscribed to the foregoing instrument, and acknowledged that (he/she/they) executed the foregoing Mortgage as (his/her/their) free act and deed.

_________________________________
Notary Public, State of Maine
My Commission Expires: __________

EXHIBIT A

LEGAL DESCRIPTION OF THE MORTGAGED PROPERTY

[INSERT METES AND BOUNDS OR PLAT DESCRIPTION]

EXHIBIT B

PERMITTED LIENS

[If none, insert “None.”]