MORTGAGE AGREEMENT

(State of Michigan – Real Property)

[// GUIDANCE: This template is drafted to comply with Michigan law (including MCL 600.3101 et seq. & 600.3201 et seq.) and incorporates customary lender-protective provisions. All bracketed items must be completed or revised by counsel prior to execution and recordation.]

TABLE OF CONTENTS

I. Document Header
II. Definitions
III. Operative Provisions
IV. Representations & Warranties
V. Covenants & Restrictions
VI. Default & Remedies
VII. Risk Allocation
VIII. Dispute Resolution
IX. General Provisions
X. Execution Block

I. DOCUMENT HEADER

1. Parties
   1.1 Mortgagor(s): [Full Legal Name(s)], a [type of entity/individual] with an address at [Address] (“Mortgagor”).
   1.2 Mortgagee: [Full Legal Name], a [state and form of organization] with an address at [Address] (“Mortgagee”).

2. Recitals
   A. Mortgagee has agreed to extend credit to Mortgagor in the original principal amount of $[Loan Amount] (the “Loan”) evidenced by that certain Promissory Note dated of even date herewith (the “Note”).
   B. Mortgagor is the owner of the real property more particularly described in Exhibit A (the “Property”).
   C. To secure the Obligations (as defined below), Mortgagor is granting Mortgagee a first priority mortgage lien on the Property and an assignment of rents pursuant to MCL 554.231.

3. Granting Clause
   FOR VALUABLE CONSIDERATION, the receipt and sufficiency of which are acknowledged, and to secure the Obligations, Mortgagor hereby grants, bargains, sells, conveys, mortgages, and warrants to Mortgagee, with power of sale, all of Mortgagor’s right, title, and interest in and to the Property, together with all Improvements, Fixtures, Easements, Rents, and Proceeds (each as defined below).

4. Effective Date; Governing Law
   This Mortgage is effective as of [Effective Date] and shall be governed by the laws of the State of Michigan without regard to conflict-of-laws principles.

II. DEFINITIONS

The following terms (alphabetically listed) shall have the meanings set forth below. Terms defined in the singular include the plural and vice-versa.

“Deficiency Judgment” – A judgment, if any, for the unpaid balance of the Obligations following foreclosure and application of sale proceeds, subject to the limitations of MCL 600.3280.

“Easements” – All easements, rights-of-way, licenses, hereditaments and appurtenances now or hereafter belonging to or benefiting the Property.

“Event of Default” – Any event described in Section VI.1.

“Fixtures” – All goods that have become or are to become fixtures (as defined in UCC §9-102) attached to the Property.

“Improvements” – All existing and future buildings, structures, additions, replacements and other improvements on the Property.

“Obligations” – (i) all indebtedness evidenced by the Note (including interest, late charges, and protective advances), (ii) all amounts payable under this Mortgage or any Loan Document, and (iii) all renewals, extensions, modifications, and substitutions thereof.

“Proceeds” – All proceeds, products, offspring, rents or profits of the Property, including insurance and condemnation awards.

“Receiver” – A receiver appointed under Section VI.3(c).

“Rents” – All present and future leases, rents, issues, royalties and profits of the Property.

III. OPERATIVE PROVISIONS

1. Security Interest
   Pursuant to MCL 440.9102 (1)(b), this Mortgage shall constitute a security agreement on any portion of the Property that is personal property. Mortgagor authorizes Mortgagee to file any financing statements deemed necessary.

2. Promise to Pay and Perform
   Mortgagor shall pay the Obligations when due and perform all covenants contained in the Loan Documents.

3. Payment Terms
   (a) Interest: [Interest Rate]% per annum, computed on the basis of a 360-day year.
   (b) Maturity Date: [Maturity Date].
   (c) Late Charge: []% of any installment not paid within [] days after the due date.

4. Conditions Precedent
   Mortgagee’s obligation to advance Loan proceeds is subject to satisfaction of all conditions in the Loan Agreement, including delivery of acceptable title insurance and proof of hazard insurance naming Mortgagee as mortgagee and loss payee.

5. Taxes and Insurance Escrow
   [Optional—check box] ☐ Mortgagor shall deposit with Mortgagee monthly escrow payments equal to one-twelfth (1/12) of annual real estate taxes and insurance premiums.

[// GUIDANCE: Delete or tailor Section III.5 if taxes/insurance escrow is handled outside the Mortgage.]

IV. REPRESENTATIONS & WARRANTIES

1. Organization and Authority
   Mortgagor is duly organized, validly existing and in good standing under the laws of its jurisdiction, and has full power to execute and perform this Mortgage.

2. Title
   Mortgagor holds good and marketable fee simple title to the Property, free of all liens except (i) real property taxes not yet due, and (ii) those matters listed on Schedule B-II of the mortgagee policy of title insurance issued to Mortgagee.

3. Compliance With Laws
   The Property and its current use comply in all material respects with applicable zoning, environmental, health and safety laws.

4. Enforceability
   This Mortgage and each Loan Document constitute legal, valid and binding obligations of Mortgagor enforceable against Mortgagor in accordance with their terms, subject to bankruptcy and equitable principles.

5. No Litigation
   No action or proceeding is pending or, to Mortgagor’s knowledge, threatened that would materially impair the Property or Mortgagor’s ability to perform hereunder.

V. COVENANTS & RESTRICTIONS

1. Payment and Performance
   Mortgagor shall pay and perform the Obligations in accordance with their terms.

2. Taxes, Assessments, and Other Charges
   Mortgagor shall pay prior to delinquency all taxes, assessments, water and sewer rents and other governmental charges affecting the Property.

3. Insurance
   (a) Maintain all-risk property insurance on the Improvements in an amount not less than 100% of full replacement cost;
   (b) Maintain liability insurance with limits not less than $[__] per occurrence;
   (c) Policies shall name Mortgagee as mortgagee and loss payee (ISO Form 438BFU);
   (d) Provide certificates annually.

4. Maintenance and Waste
   Mortgagor shall keep the Property in good repair, avoid waste, and comply with all legal requirements.

5. Transfers; Due on Sale
   Except with Mortgagee’s prior written consent, any conveyance, lease for a term exceeding [__] years, or other transfer of the Property or controlling ownership interests in Mortgagor shall constitute an Event of Default, and Mortgagee may declare the Obligations immediately due and payable in accordance with 12 U.S.C. §1701j-3 (for residential property, if applicable) or other applicable law.

6. Hazardous Substances
   Mortgagor shall not cause or permit the presence of Hazardous Substances on the Property in violation of environmental laws and shall indemnify Mortgagee for any environmental liabilities (see Section VII.1).

7. Books and Records; Inspection
   Upon reasonable notice, Mortgagee may inspect the Property and examine Mortgagor’s books and records relating thereto.

8. Notice of Material Matters
   Mortgagor shall promptly notify Mortgagee of (i) any Event of Default, (ii) any material damage to the Property, or (iii) any governmental notice alleging non-compliance.

VI. DEFAULT & REMEDIES

1. Events of Default
   The occurrence of any one or more of the following shall constitute an “Event of Default”:
   (a) Non-payment of any monetary Obligation within [10] days after its due date;
   (b) Breach of any non-monetary covenant not cured within [30] days after notice;
   (c) Any representation proves materially false when made;
   (d) Unauthorized transfer or encumbrance of the Property;
   (e) Bankruptcy or insolvency of Mortgagor or any guarantor.

2. Notice and Cure
   Except for payment defaults (which require no notice), Mortgagee shall give written notice specifying the default and allow Mortgagor the applicable cure period stated above.

3. Remedies
   Upon an Event of Default and expiration of any cure period, Mortgagee may exercise any or all of the following remedies:
   (a) Acceleration. Declare the Obligations immediately due and payable.
   (b) Foreclosure.
   (i) Foreclose by advertisement pursuant to MCL 600.3201 et seq., or
   (ii) Foreclose judicially under MCL 600.3101 et seq.
   [// GUIDANCE: Foreclosure method is within Mortgagee’s discretion; both are preserved.]
   (c) Appointment of Receiver. Seek appointment of a receiver under MCL 600.2927 to take possession of the Property and collect Rents.
   (d) Possession. Enter and take possession of the Property to protect the lien.
   (e) Set-Off. Apply any of Mortgagor’s deposits with Mortgagee to the Obligations.
   (f) Other Remedies. Exercise any other right or remedy available at law or in equity.

4. Right of Redemption
   After foreclosure sale, Mortgagor (or its successors) shall have the statutory right to redeem the Property within the applicable period under MCL 600.3240 (generally six (6) months, or twelve (12) months if the Property exceeds four units or certain loan-to-value thresholds, or thirty (30) days if the Property is abandoned).

5. Deficiency Judgment
   If the proceeds of any foreclosure sale are insufficient to satisfy the Obligations, Mortgagee may seek a Deficiency Judgment subject to MCL 600.3280, which limits recovery to the lesser of (i) the amount by which the debt exceeds the fair market value of the Property at the time of sale, or (ii) such other amount as determined by the court.

6. Attorneys’ Fees and Costs
   Mortgagor shall pay all reasonable attorneys’ fees, receiver fees, and costs incurred by Mortgagee in enforcing the Loan Documents, whether or not litigation is commenced, to the fullest extent permitted by MCL 438.31c.

VII. RISK ALLOCATION

1. Indemnification by Mortgagor
   Mortgagor shall indemnify, defend and hold Mortgagee, its successors and assigns harmless from and against any and all losses, liabilities, claims, damages, penalties, and expenses (including reasonable attorneys’ fees) arising out of or relating to:
   (a) ownership, operation or condition of the Property;
   (b) breach of any representation, warranty, or covenant;
   (c) release or violation of environmental laws; and
   (d) third-party claims for personal injury or property damage.
   The foregoing indemnity shall survive payment of the Obligations and release of this Mortgage.

2. Limitation of Liability (Cap)
   Subject to any non-waivable liability under applicable law, Mortgagee’s liability to Mortgagor for any claim arising under the Loan Documents shall in no event exceed the aggregate amount actually received by Mortgagee on account of the Obligations (the “Liability Cap”).

3. Force Majeure
   Neither party shall be liable for failure to perform non-monetary obligations due to acts of God, war, terrorism, pandemic, or other events beyond its reasonable control, provided the affected party gives prompt notice and resumes performance when the force majeure event ends. Monetary Obligations are expressly excluded from this clause.

VIII. DISPUTE RESOLUTION

1. Governing Law
   This Mortgage and the Obligations shall be governed by and construed in accordance with the laws of the State of Michigan.

2. Forum Selection
   Any action or proceeding arising out of or relating to the Loan Documents shall be brought exclusively in the state courts located in [County], Michigan, and Mortgagor hereby submits to the jurisdiction of such courts.

3. Arbitration
   The parties expressly waive any agreement to arbitrate; disputes shall be resolved solely in the courts specified above.

4. Jury Waiver
   [Optional—check box] ☐ WAIVER OF JURY TRIAL. TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH PARTY KNOWINGLY AND VOLUNTARILY WAIVES ITS RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING ARISING OUT OF THE LOAN DOCUMENTS.
   [// GUIDANCE: Jury waivers are generally enforceable in Michigan but should be initialed by the parties for added protection.]

5. Injunctive Relief
   Mortgagee shall be entitled to temporary, preliminary and permanent injunctive relief (including the appointment of a receiver and orders for specific performance) to enforce its rights under this Mortgage, without the necessity of proving actual damages.

IX. GENERAL PROVISIONS

1. Amendments; Waivers
   No amendment or waiver shall be effective unless in writing signed by the party against whom enforcement is sought. A waiver on one occasion shall not be deemed a waiver on any future occasion.

2. Assignment
   Mortgagee may assign or transfer its interest in the Loan Documents without Mortgagor’s consent. Mortgagor may not assign any rights without Mortgagee’s prior written consent.

3. Successors and Assigns
   The Loan Documents shall be binding upon and inure to the benefit of the parties and their respective successors and permitted assigns.

4. Severability
   If any provision is held invalid or unenforceable, the remainder shall remain in full force, and the invalid provision shall be reformed to the minimum extent necessary to give effect to the parties’ intent.

5. Integration
   The Loan Documents constitute the entire agreement between the parties with respect to the subject matter and supersede all prior or contemporaneous understandings.

6. Counterparts; Electronic Signatures
   This Mortgage may be executed in multiple counterparts and by electronic signature (including DocuSign or similar platform), each of which shall be deemed an original and all of which together constitute one instrument.

7. Notices
   All notices shall be in writing and delivered (i) by certified mail (return receipt requested), (ii) by nationally recognized overnight courier, or (iii) by personal delivery, to the addresses stated in Section I, or such other address as a party designates by notice. Notices are effective upon receipt or first refusal.

X. EXECUTION BLOCK

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

MORTGAGOR:

[Name and Title]
[Entity Name]

MORTGAGEE:

[Name and Title]
[Entity Name]

[// GUIDANCE: Ensure corporate authority—attach secretary’s certificate or resolutions authorizing execution.]

NOTARY ACKNOWLEDGMENT

State of Michigan )
) ss.
County of [__] )

On this ___ day of _, 20_, before me, the undersigned Notary Public, personally appeared ____, who acknowledged that (he/she) executed the foregoing instrument on behalf of and with authority from the above-named [Mortgagor/Mortgagee].

Notary Public, State of Michigan
Acting in County of _
My commission expires: __

EXHIBIT A

(Legal Description of Property)

[Insert full metes-and-bounds or plat description; include tax parcel number(s).]

[// GUIDANCE FOR RECORDING:
1. Use margin requirements prescribed by the Michigan Register of Deeds.
2. Affix property tax ID number on the first page (MCL 565.201).
3. Pay recording tax/fees at the applicable county rate.
4. Verify county-specific font size (usually 10-point minimum) and 2-inch top margin for return address.]

END OF DOCUMENT