EXHIBIT 10(p)
SECURITY AGREEMENT
This SECURITY AGREEMENT (this "Agreement"), dated as of June 1, 2004, is
made by SOUTH HAMPTON REFINING Co., a Texas corporation (the "Debtor"), in favor
of XXXXXX OPERATING PARTNERSHIP L.P., a Delaware limited partnership (the
"Secured Party").
NOW THEREFORE, for and in consideration of the Secured Party and its
affiliates (such affiliates, together with the Secured Party, are collectively
referred to herein as "Xxxxxx") agreeing to sell natural gasoline and other
Inventory to the Debtor, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Debtor agrees as
follows:
1. DEFINED TERMS. Unless otherwise defined herein, capitalized terms used
herein that are defined in Article 9 of the Uniform Commercial Code as enacted
in the State of Texas (the "UCC") are used herein as therein defined.
2. INDEBTEDNESS. As of April 30, 2004, the Debtor owes Xxxxxx
approximately $7,000,000 for natural gasoline that it has purchased from Xxxxxx.
The Debtor agrees to pay all indebtedness and accounts payable which are now
owed by the Debtor to Xxxxxx, all additional indebtedness and accounts payable
hereafter owed by the Debtor to Xxxxxx for or incident to the purchase of
natural gasoline and other Inventory from Xxxxxx, all money or credit heretofore
or hereafter advanced by Xxxxxx to or for the account of the Debtor, and all
other indebtedness and other amounts which may at any time be owing by the
Debtor to Xxxxxx, pursuant to sales by Xxxxxx to the Debtor or otherwise,
whether direct or indirect, absolute or contingent, due or to become due, or now
existing or hereafter incurred, and whether evidenced by notes, open accounts,
or otherwise. In addition to the indebtedness and obligations heretofore
described, the Debtor agrees to pay any and all fees, costs and other expenses
(including without limitation reasonable fees of Xxxxxx'x attorneys and costs
associated therewith) incurred or hereafter incurred in connection with the
enforcement of this Agreement. All of the indebtedness and obligations of the
Debtor described in this Section 2 are collectively referred to herein as the
"Obligations".
3. SECURITY INTEREST. The Debtor hereby assigns and transfers to the
Secured Party, and hereby grants to the Secured Party, its successors and
assigns, for the ratable benefit of Xxxxxx, a security interest in all of the
following assets and property, tangible and intangible, whether now owned or at
any time hereafter acquired by the Debtor or in which the Debtor now has or at
any time in the future may acquire any right, title or interest (collectively,
the "Collateral"), as collateral security for the prompt and complete payment
and performance when due (whether at the stated maturity, by acceleration or
otherwise) of the Obligations:
(a) all natural gasoline and other Inventory, in all of its forms
and wherever located, purchased or otherwise acquired by the Debtor from
Xxxxxx (collectively, the "Product"):
(b) all Accounts, Chattel Paper, Documents, General Intangibles,
Instruments and Supporting Obligations related to any Product or otherwise
resulting from the sale or other disposition of any Product; and
(c) to the extent not otherwise included, all Proceeds of the
foregoing.
4. PURCHASE-MONEY SECURITY INTEREST. The Debtor and the Secured Party
hereby declare that the security interest granted with respect to the Product is
taken or retained by the Secured Party, as seller of such Product, to secure all
or part of the purchase price thereof, and that such security interest is a
Purchase-Money Security Interest.
5. REPRESENTATIONS AND WARRANTIES BY THE DEBTOR. To induce Xxxxxx to sell
Product to the Debtor, the Debtor hereby represents and warrants to the Secured
Party that:
(a) the Debtor's jurisdiction of incorporation, organizational
identification number and the location of its chief executive office are
specified on Schedule 1 hereto;
(b) the Debtor is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation
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(c) the Debtor has full corporate authority and power to enter into
this Agreement and to carry out the transactions contemplated hereby; and
(d) this Agreement constitutes a valid and binding obligation of the
Debtor, enforceable in accordance with its terms.
6. STORAGE AND DISPOSITION OF PRODUCT. The Debtor hereby agrees and
covenants that Xxxxxx shall own, retain title to and shall have superior right
to possession of any and all natural gasoline or other Product of any kind or
description purchased for the benefit of and with the agreement of the Debtor,
whether in a storage tank or tanks, located on Debtor's premises in Tank #57 or
otherwise, or off Debtor's premises, whether in pipeline transit from Mount
Belvieu, in Tank #BMT-113, or otherwise located at, on or under the control of
or storage by the Debtor and/or Texas Eastern Product Pipeline Company, and the
Debtor acknowledges the terms of its sale agreement with Xxxxxx which are and
have been FOB leaving any tank or storage until such product passes the flange
on the pump going into the Debtor's plant refining process. The Debtor agrees
that such natural gasoline and other Product of Xxxxxx will, at all times, be
separately stored, whether in Tank #57 or otherwise, and subject to immediate
identification, and that the Debtor will not allow or permit any of Xxxxxx'x
natural gasoline and other Product to be mixed or joined in any manner with that
of another supplier, vendor, party, adverse claimant, creditor or entity.
Subject to the foregoing restrictions in this Section 6, the Debtor may use,
sell or otherwise dispose of the Product and Proceeds thereof in the normal
operation of its business; but any such use, sale or disposition shall not
affect the Secured Party's security interest in any such Product or Proceeds to
the extent that the Debtor has not paid Xxxxxx the full purchase price therefor.
The liberty provided for herein to use, sale or dispose of the Product and
Proceeds thereof does not include the right or power to pledge or encumber such
Product or Proceeds to secure a debt or other obligation of the Debtor, and any
attempted pledge of such Product or Proceeds or the creation or continuance of
any such encumbrance without the written permission of the Secured Party shall
constitute a default hereunder. Notwithstanding the immediately preceding
sentence, the pledge or encumbrance by the Debtor of its Accounts, Chattel
Paper, Documents, General Intangibles, Instruments and Supporting Obligations
related to any Product or otherwise resulting from the sale or other disposition
of any Product, and any other Proceeds of the Product, shall not constitute a
default hereunder so long as such pledge or encumbrance is pursuant to that
certain Purchase and Sale Agreement/Security Agreement dated July 29, 2003, by
and between the Debtor and Southwest Bank of Texas, N.A., or any agreement
ancillary thereto.
7. COVENANTS BY THE DEBTOR. The Debtor covenants and agrees with the
Secured Party that, from and after the date of this Agreement until the
Obligations shall have been paid in full, the Debtor will:
(a) maintain, with financially sound and reputable companies,
insurance policies (i) insuring the Collateral against loss by fire,
explosion, theft, and other customary casualties and (ii) insuring against
liability for personal injury and property damage relating to such
Collateral, such policies to be in such form and amounts and having such
coverage as is customary and reasonable for the Debtor's type of business.
Such insurance may be issued in the name of the Debtor who may retain
possession of the policies, but each policy shall include a loss payable
clause listing the Secured Party as its interests may appear, in form and
substance reasonably satisfactory to the Secured Party. Upon request of
the Secured Party, the Debtor shall immediately furnish the Secured Party
with copies of such insurance policies or a certificate of insurance
issued by the insurer;
(b) not use or permit the Collateral to be used in violation of any
law or regulation or inconsistent with any term of a policy of insurance;
(c) not use or permit the Collateral to be used in any manner or for
any purpose that would impair the value of the Collateral or expose the
Collateral to unusual or high risk;
(d) pay when due all taxes, fees and charges of any kind whatsoever
that may be assessed or charged on or against any of the Product, or the
sale or use thereof, at any time on or after the date of the delivery of
the Product to the Debtor;
(e) keep all Product free and clear of all liens and encumbrances
however arising, other than liens that are subordinate to the lien and
security interest granted by the Debtor to the Secured Party hereby; and
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(f) other than the lien in favor of Southwest Bank of Texas, N.A.
described in Section 6 hereof, keep all Collateral (other than Product)
free and clear of all liens and encumbrances however arising, other than
liens that are subordinate to the lien and security interest granted by
the Debtor to the Secured Party hereby.
8. BOOKS AND RECORDS. The Debtor shall keep accurate books and records of
account in accordance with generally accepted accounting principles and prudent
business standards for companies engaged in the same or similar businesses,
including without limitation sales records of the Product. The Debtor shall
furnish to the Secured Party, upon request of the Secured Party at any time
while the Obligations hereby secured remain unpaid, full information regarding
the Debtor's inventory of Product on hand, Product sold, the Proceeds thereof,
and any contracts or agreements affecting such Product. The Secured Party shall
have the right at any reasonable time during the Debtor's regular business hours
to inspect the Collateral and the Debtor's books and records with respect
thereto.
9. CHANGES IN LOCATIONS, NAME, ETC. The Debtor will give written
notification to the Secured Party 10 days prior to the Debtor doing any of the
following:
(a) a change of its jurisdiction of organization or the location of
its chief executive office from that referred to in Schedule 1 hereto; or
(b) a change of its name, identity or corporate structure to such an
extent that any financing statement filed by the Secured Party in
connection with this Agreement would become misleading or ineffective
under applicable law.
10. NOTICES. The Debtor will advise the Secured Party promptly, in
reasonable detail, of:
(a) any lien (other than security interests created hereby) on any
of the Collateral; and
(b) the occurrence of any other event which could reasonably be
expected to have a material adverse effect on the aggregate value of the
Collateral or on the security interests created hereby.
11. MAINTENANCE OF PERFECTED SECURITY INTEREST; FURTHER DOCUMENTATION. The
Debtor shall maintain the security interest created by this Agreement as a
perfected security interest having at least the priority described in Section 7
and shall defend such security interest against the claims and demands of all
persons or entities whomsoever. The Debtor will furnish to the Secured Party
from time to time statements and schedules further identifying and describing
the Collateral and such other reports in connection with the Collateral as the
Secured Party may reasonably request, all in reasonable detail. At any time and
from time to time, upon the written request of the Secured Party, and at the
sole expense of the Debtor, the Debtor will promptly and duly execute, deliver
and file with appropriate agencies such further instruments and documents and
take such further actions as the Secured Party may reasonably request for the
purpose of obtaining or preserving the full benefits of this Agreement and of
the rights and powers herein granted.
12. DEFAULT. Each of the following shall constitute an event of default by
the Debtor (each, a "Default"):
(a) the Debtor defaults in the payment or performance when due of
any Obligation to Xxxxxx and such default is not cured within 10 days
after the Debtor receiving written notice of such default from the Secured
Party; or
(b) the Debtor fails to perform or comply with any term contained in
this Agreement and, if capable of being cured, such default is not cured
within 30 days after the earlier of (i) a senior officer of Debtor
obtaining knowledge of such default and (ii) the Debtor receiving written
notice of such default from the Secured Party; or
(c) the Debtor, in violation of Section 7 hereof, allows any lien or
encumbrance to be created or remain upon the Collateral if such lien or
encumbrance has priority over the lien and security interest created
hereby in favor of the Secured Party (other than any such lien or security
interest permitted by Section 7 hereof); or
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(d) the Debtor becomes insolvent, makes an assignment for the
benefit of creditors, institutes or has instituted against it proceedings
under any bankruptcy or insolvency law, or the Debtor has its stock in
trade or any part thereof levied upon or attached; or
(e) the commencement of dissolution or liquidation of the Debtor as
a corporation; or
(f) determination by Xxxxxx that the Debtor has made or furnished to
Xxxxxx a false statement, representation or warranty in a material
respect; or
(g) occurrence of loss, damage or destruction of the Product not
covered by adequate insurance containing a loss payable clause in favor of
the Secured Party.
13. ASSIGNMENTS AND DEFENSES. The Secured Party shall have the right to
negotiate or assign all or any part of the security interest evidenced by this
Agreement and any Obligations which it secures, without any notice to the
Debtor. The Debtor specifically agrees that if there is any assignment or
transfer of all or any part of the security interest created hereunder, the
assignee or transferee shall have all of the Secured Party's rights and remedies
under this Agreement and that the Debtor will not assert as a defense,
counterclaim, set-off, cross-complaint or otherwise, any claim, known or
unknown, which it now has or hereafter acquires against the Secured Party, in
any action commenced by such assignee or transferee.
14. COMMUNICATIONS WITH OBLIGORS. The Secured Party in its own name or in
the name of others may at any time after the occurrence and during the
continuance of a Default communicate with obligors on the Accounts that
constitute Collateral to verify with them to the Secured Party's reasonable
satisfaction the existence, amount and terms of any such Accounts. Upon the
request of the Secured Party at any time after the occurrence and during the
continuance of a Default, the Debtor shall notify obligors on the Collateral
that such Collateral has been assigned to the Secured Party and that payments in
respect thereof shall be made directly to the Secured Party.
15. PROCEEDS TO BE TURNED OVER TO SECURED PARTY. If a Default shall occur
and be continuing, all Proceeds constituting Collateral received by the Debtor
consisting of cash, checks and other near-cash items shall be held by the Debtor
in trust for the Secured Party segregated from other funds of the Debtor, and
shall, immediately upon receipt by the Debtor, be turned over to the Secured
Party in the exact form received by the Debtor (duly indorsed by the Debtor to
the Secured Party, if required). At the Secured Party's request, the Debtor
shall deliver to the Secured Party all original and other documents evidencing,
and relating to, the agreements and transactions which gave rise to the
Collateral, including, without limitation, all original orders, invoices and
shipping receipts.
16. APPLICATION OF PROCEEDS. If a Default shall have occurred and be
continuing, the Secured Party may, at its election, apply all or any part of the
Collateral or Proceeds constituting Collateral to the payment of the Obligations
in such order as the Secured Party may elect, and any part of such funds which
the Secured Party does not so apply to the Obligations and which the Secured
Party deems not to require as collateral security for the Obligations shall be
paid over from time to time by the Secured Party to the Debtor or to whomsoever
may be lawfully entitled to receive the same. Any balance of such Proceeds
remaining after the Obligations shall have been paid in full shall be paid over
to the Debtor or to whomsoever may be lawfully entitled to receive the same.
17. UCC AND OTHER REMEDIES. If a Default shall occur and be continuing,
the Secured Party may exercise, in addition to all other rights and remedies
granted to the Secured Party in this Agreement and in any other instrument or
agreement securing, evidencing or relating to the Obligations, all rights and
remedies of a secured party under the UCC or any other applicable law. Without
limiting the generality of the foregoing, the Secured Party, without demand of
performance or other demand, presentment, protest, advertisement or notice of
any kind (except any notice required by law referred to below) to or upon the
Debtor or any other person or entity (all and each of which demands, defenses,
advertisements and notices are hereby waived), may in such circumstances
collect, receive, appropriate and realize upon the Collateral, or any part
thereof, and/or may sell, lease, assign, give option or options to purchase, or
otherwise dispose of and deliver the Collateral or any part thereof (or contract
to do any of the foregoing), in one or more parcels at public or private sale or
sales, at any exchange, broker's board or office of the Secured Party or
elsewhere, upon such terms and conditions as it may deem advisable and at such
prices as it may deem best, for cash or on credit or for future delivery without
assumption of any credit risk. The Secured Party shall have the right upon any
such public sale or sales, and, to the extent permitted by law, upon any
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such private sale or sales, to purchase the whole or any part of the Collateral
so sold, free of any right or equity of redemption in the Debtor, which right or
equity is hereby waived and released. The Debtor further agrees, at the Secured
Party's request, to assemble the Collateral and make it available to the Secured
Party at places which the Secured Party shall reasonably select, whether at the
Debtor's premises or elsewhere. The Secured Party shall apply the net proceeds
of any action taken by it pursuant to this Section 17, after deducting all
reasonable costs and expenses of every kind incurred in connection therewith or
incidental to the care or safekeeping of any of the Collateral or in any way
relating to the Collateral or the rights of the Secured Party hereunder,
including, without limitation, reasonable attorneys' fees and disbursements, to
the payment in whole or in part of the Obligations, in such order as the Secured
Party may select, and only after such application and after the payment by the
Secured Party of any other amount required by any provision of law, including,
without limitation, Section 9.615(a)(3) of the UCC, need the Secured Party
account for the surplus, if any, to the Debtor. To the extent permitted by
applicable law, the Debtor waives all claims, damages and demands it may acquire
against the Secured Party arising out of the exercise by the Secured Party of
any rights hereunder. If any notice of a proposed sale or other disposition of
Collateral shall be required by law, such notice shall be deemed reasonable and
proper if given at least 10 days before such sale or other disposition.
18. DEFICIENCY. The Debtor shall remain liable for any deficiency if the
proceeds of any sale or other disposition of the Collateral are insufficient to
pay its Obligations and the fees and disbursements of any attorneys employed by
the Secured Party to collect such deficiency.
19. SECURED PARTY'S APPOINTMENT AS ATTORNEY-IN-FACT, ETC. The Debtor
hereby irrevocably constitutes and appoints the Secured Party and any officer or
agent thereof, with full power of substitution, as its true and lawful
attorney-in-fact with full irrevocable power and authority in the place and
stead of the Debtor and in the name of the Debtor or in its own name, for the
purpose of carrying out the terms of this Agreement, to take any and all
appropriate action and to execute any and all documents and instruments which
may be necessary or desirable to accomplish the purposes of this Agreement, and,
without limiting the generality of the foregoing, the Debtor hereby gives the
Secured Party the power and right, on behalf of the Debtor, without notice to or
assent by the Debtor, to do any or all of the following:
(a) in the name of the Debtor or its own name, or otherwise, take
possession of and indorse and collect any checks, drafts, notes,
acceptances or other instruments for the payment of moneys due under any
Collateral or with respect to any Collateral and file any claim or take
any other action or proceeding in any court of law or equity or otherwise
deemed appropriate by the Secured Party for the purpose of collecting any
and all such moneys due under any Collateral or with respect to any
Collateral whenever payable;
(b) pay or discharge taxes and liens levied or placed on or
threatened against the Collateral, effect any repairs or any insurance
called for by the terms of this Agreement and pay all or any part of the
premiums therefor and the costs thereof;
(c) execute, in connection with any sale provided for in Section 17,
any endorsements, assignments or other instruments of conveyance or
transfer with respect to the Collateral;
(d) direct any party liable for any payment under any of the
Collateral to make payment of any and all moneys due or to become due
thereunder directly to the Secured Party or as the Secured Party shall
direct;
(e) ask or demand for, collect, and receive payment of and receipt
for, any and all moneys, claims and other amounts due or to become due at
any time in respect of or arising out of any Collateral;
(f) sign and indorse any invoices, freight or express bills, bills
of lading, storage or warehouse receipts, drafts against debtors,
assignments, verifications, notices and other documents in connection with
any of the Collateral;
(f) commence and prosecute any suits, actions or proceedings at law
or in equity in any court of competent jurisdiction to collect the
Collateral or any portion thereof and to enforce any other right in respect
of any Collateral;
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(g) defend any suit, action or proceeding brought against the Debtor
with respect to any Collateral;
(h) settle, compromise or adjust any such suit, action or proceeding
and, in connection therewith, give such discharges or releases as the
Secured Party may deem appropriate; and
(i) generally, sell, transfer, pledge and make any agreement with
respect to or otherwise deal with any of the Collateral as fully and
completely as though the Secured Party were the absolute owner thereof for
all purposes, and do, at the Secured Party's option and the Debtor's
expense, at any time, or from time to time, all acts and things which the
Secured Party deems necessary to protect, preserve or realize upon the
Collateral and the Secured Party's security interests therein and to
effect the intent of this Agreement, all as fully and effectively as the
Debtor might do.
Anything in this Section 19 to the contrary notwithstanding, the Secured Party
agrees that it will not exercise any rights under the power of attorney provided
for in this Section 19 unless a Default shall have occurred and be continuing.
If the Debtor fails to perform or comply with any of its agreements contained in
this Agreement, the Secured Party, at its option, but without any obligation so
to do, may perform or comply, or otherwise cause performance or compliance, with
such agreement. The expenses of the Secured Party incurred in connection with
actions undertaken as provided in this Section 19, together with interest
thereon at a per annum interest rate equal to eight percent (8%), from the date
of payment by the Secured Party to the date reimbursed by the Debtor, shall be
payable by the Debtor to the Secured Party on demand. The Debtor hereby ratifies
all that said attorneys shall lawfully do or cause to be done by virtue hereof.
All powers, authorizations and agencies contained in this Agreement are coupled
with an interest and are irrevocable until this Agreement is terminated and the
security interests created hereby are released.
20. DUTY OF SECURED PARTY. The Secured Party's sole duty with respect to
the custody, safekeeping and physical preservation of the Collateral in its
possession, under Section 9.207 of the UCC or otherwise, shall be to deal with
it in the same manner as the Secured Party deals with similar property for its
own account; provided that in no event shall such duty require the Secured Party
to take steps to preserve rights against prior parties with respect to any
Chattel Paper or Instruments. Neither the Secured Party nor any of its officers,
directors, employees or agents shall be liable for failure to demand, collect or
realize upon any of the Collateral or for any delay in doing so or shall be
under any obligation to sell or otherwise dispose of any Collateral upon the
request of the Debtor or any other person or entity or to take any other action
whatsoever with regard to the Collateral or any part thereof. The powers
conferred on the Secured Party hereunder are solely to protect the Secured
Party's interests in the Collateral and shall not impose any duty upon the
Secured Party to exercise any such powers. The Secured Party shall be
accountable only for amounts that it actually receives as a result of the
exercise of such powers, and neither the Secured Party nor any of its officers,
directors, employees or agents shall be responsible to the Debtor for any act or
failure to act hereunder, except for their own gross negligence or willful
misconduct.
21. FINANCING STATEMENTS. Pursuant to Section 9.509 of the UCC and any
other applicable laws, the Debtor authorizes the Secured Party to file or record
financing statements and other filing or recording documents or instruments with
respect to the Collateral without the signature of the Debtor in such form and
in such offices as the Secured Party reasonably determines appropriate to
perfect the security interests of the Secured Party under this Agreement.
22. AUTHORITY OF SECURED PARTY. The Secured Party is hereby granted a
non-exclusive license or other right to use without charge during the
continuance of a Default the Debtor's labels, patents, copyrights, rights of use
of any name, trade secrets, trade names, trademarks and advertising matter, or
any tangible or intangible property or rights of a similar nature of the Debtor
as they pertain to the Collateral, in advertising for sale and selling any
Collateral.
23. AMENDMENTS IN WRITING. None of the terms or provisions of this
Agreement may be waived, amended, supplemented or otherwise modified except in a
writing signed by the Debtor and the Secured Party.
24. NOTICES. All notices and other communications provided for herein
shall be in writing and shall be delivered by hand or overnight courier service,
mailed by certified or registered mail or sent by facsimile: (a) if to the
Debtor, to it at X.X. Xxx 0000, Xxxxxxx, Xxxxx 00000, Attention: Xxxxxxxx X.
Xxxxxx; or (b) if to the Secured
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Party, to it at 0000 Xxxxx Xxxx, Xxxxxxx, Xxxxx 00000, Attention: President,
facsimile number (000) 000-0000. Any party hereto may change its address or
facsimile number for notices and other communications hereunder by notice to the
other parties hereto. All notices and other communications given to any party
hereto in accordance with the provisions of this Agreement shall be deemed to
have been given on the date of receipt.
25. NO WAIVER BY COURSE OF CONDUCT; CUMULATIVE REMEDIES. The Secured Party
shall not by any act, delay, indulgence, omission or otherwise be deemed to have
waived any right or remedy hereunder or to have acquiesced in any Default. No
failure to exercise, nor any delay in exercising, on the part of the Secured
Party, any right, power or privilege hereunder shall operate as a waiver
thereof. No single or partial exercise of any right, power or privilege
hereunder shall preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. A waiver by the Secured Party of any
right or remedy hereunder on any one occasion shall not be construed as a bar to
any right or remedy which the Secured Party would otherwise have on any future
occasion. The rights and remedies herein provided are cumulative, may be
exercised singly or concurrently and are not exclusive of any other rights or
remedies provided by law.
26. ENFORCEMENT EXPENSES; INDEMNIFICATION. The Debtor agrees to pay or
reimburse the Secured Party for all its costs and expenses incurred in enforcing
or preserving any rights under this Agreement, including, without limitation,
the fees and disbursements of counsel to the Secured Party. The Debtor agrees to
pay, and to save the Secured Party harmless from, any and all liabilities with
respect to, or resulting from any delay in paying, any and all stamp, excise,
sales or other taxes which may be payable or determined to be payable with
respect to any of the Collateral or in connection with any of the transactions
contemplated by this Agreement. THE DEBTOR AGREES TO INDEMNIFY THE SECURED PARTY
AND XXXXXX (EACH SUCH PERSON BEING CALLED AN "INDEMNITEE") AGAINST, AND HOLD
EACH INDEMNITEE HARMLESS FROM, ANY AND ALL LOSSES, CLAIMS, DAMAGES, LIABILITIES
AND RELATED EXPENSES, INCLUDING THE FEES, CHARGES AND DISBURSEMENTS OF ANY
COUNSEL FOR ANY INDEMNITEE, INCURRED BY OR ASSERTED AGAINST ANY INDEMNITEE
ARISING OUT OF, IN CONNECTION WITH, OR AS A RESULT OF (I) THE EXECUTION,
DELIVERY OR PERFORMANCE OF THIS AGREEMENT, (II) THE CONSUMMATION OF THE
TRANSACTIONS CONTEMPLATED HEREBY, (III) ANY ACTUAL OR ALLEGED PRESENCE OR
RELEASE OF HAZARDOUS MATERIALS ON OR FROM ANY PROPERTY CURRENTLY OR FORMERLY
OWNED OR OPERATED BY THE DEBTOR OR ANY OF ITS SUBSIDIARIES, OR ANY ENVIRONMENTAL
LIABILITY RELATED IN ANY WAY TO THE DEBTOR OR ANY OF ITS SUBSIDIARIES, OR (IV)
ANY ACTUAL OR PROSPECTIVE CLAIM, LITIGATION, INVESTIGATION OR PROCEEDING
RELATING TO ANY OF THE FOREGOING, WHETHER BASED ON CONTRACT, TORT OR ANY OTHER
THEORY, REGARDLESS OF WHETHER ANY INDEMNITEE IS A PARTY THERETO AND, IN ALL
CASES, WHETHER OR NOT SUCH LOSSES, CLAIMS, DAMAGES, LIABILITIES OR EXPENSES
ARISE IN WHOLE OR IN PART FROM THE NEGLIGENCE OF ANY INDEMNITEE; PROVIDED, THAT
SUCH INDEMNITY SHALL NOT, AS TO ANY INDEMNITEE, BE AVAILABLE TO THE EXTENT THAT
SUCH LOSSES, CLAIMS, DAMAGES, LIABILITIES OR RELATED EXPENSES ARE DETERMINED BY
A COURT OF COMPETENT JURISDICTION BY FINAL AND NONAPPEALABLE JUDGMENT TO HAVE
RESULTED FROM THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF SUCH INDEMNITEE. The
agreements in this Section 26 shall survive repayment of the Obligations.
27. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon the
successors and assigns of the Debtor and shall inure to the benefit of the
Secured Party and its successors and assigns; provided that the Debtor may not
assign, transfer or delegate any of its rights or obligations under this
Agreement without the prior written consent of the Secured Party.
28. SURVIVAL. All covenants, agreements, representations and warranties
made by the Debtor in this Agreement shall be considered to have been relied
upon by the Secured Party and shall survive the execution and delivery of this
Agreement, regardless of any investigation made by the Secured Party or on its
behalf and notwithstanding that the Secured Party may have had notice or
knowledge of any incorrect representation or warranty on the date hereof, and
shall continue in full force and effect as long as any part of the Obligations
remain outstanding.
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29. SEVERABILITY. Any provision of this Agreement which is held to be
illegal, invalid, and unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions hereof, and the invalidity of a particular provision in
a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.
30. INTEGRATION. This Agreement represents the entire agreement of the
Debtor and the Secured Party with respect to the subject matter hereof, and
there are no promises, undertakings, representations or warranties by the
Secured Party relative to subject matter hereof not expressly set forth or
referred to herein.
31. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH
AND GOVERNED BY THE LAW OF THE STATE OF TEXAS.
32. ACKNOWLEDGMENTS. The Debtor hereby acknowledges that (i) it has been
advised by counsel in the negotiation, execution and delivery of this Agreement;
(ii) the Secured Party has no fiduciary relationship with or duty to the Debtor
arising out of or in connection with this Agreement, and the relationship
between the Secured Party, on one hand, and the Debtor, on the other hand, in
connection herewith is solely that of debtor and creditor; and (iii) no joint
venture is created hereby or otherwise exists by virtue of the transactions
contemplated hereby between the Debtor and the Secured Party.
33. HEADINGS. The Section headings used in this Agreement are for
convenience of reference only and are not to affect the construction hereof or
be taken into consideration in the interpretation hereof.
34. TERMINATION AND RELEASE. At such time as all of the Obligations shall
have been paid in full, the Collateral shall be released from the liens created
hereby, and this Agreement and all obligations (other than those expressly
stated to survive such termination) of the Secured Party and the Debtor
hereunder shall terminate, all without delivery of any instrument or performance
of any act by any party, and all rights to the Collateral shall revert to the
Debtor. At the request and sole expense of the Debtor following any such
termination, the Secured Party shall deliver to the Debtor any Collateral held
by the Secured Party hereunder, and execute and deliver to the Debtor such
documents as the Debtor shall reasonably request to evidence such termination.
NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS AGREEMENT, THE TERM
COLLATERAL SHALL NOT INCLUDE, AND THE SECURED PARTY SHALL NOT HAVE A LIEN ON OR
SECURITY IN, ANY PRODUCT OR THE PROCEEDS THEREOF TO THE EXTENT THAT THE PURCHASE
PRICE OF SUCH PRODUCT HAS BEEN FULLY PAID TO XXXXXX BY THE DEBTOR.
35. COUNTERPARTS. This Agreement may be separately executed in any number
of counterparts, each of which when so executed shall be deemed to constitute
one and the same Agreement. Delivery of this Agreement may be made by facsimile
of a duly executed counterpart copy hereof.
[REMAINDER OF PAGE IS INTENTIONALLY LEFT BLANK; SIGNATURE PAGE FOLLOWS]
8
IN WITNESS WHEREOF, the Debtor has caused this Security Agreement to be
duly executed and delivered as of the date first above written.
SOUTH HAMPTON REFINING Co.
By: /s/ XXXX XXXXXX
--------------------------------
Name: XXXX XXXXXX
Title: President
Acknowledged and accepted as of the date first above written:
XXXXXX OPERATING PARTNERSHIP L.P.
By: Xxxxxx Operating GP LLC, its general partner
By: Xxxxxx Midstream Partners L.P., its sole member
By: Xxxxxx Midstream GP LLC, its general partner
By: /s/ Xxxxx Xxxxxx
--------------------------------------
Xxxxx Xxxxxx
President and Chief Executive Officer
SIGNATURE PAGE TO SECURITY AGREEMENT
Schedule 1
LOCATION OF JURISDICTION OF INCORPORATION,
ORGANIZATIONAL IDENTIFICATION NUMBER
AND CHIEF EXECUTIVE OFFICE
Jurisdiction of Organizational ID Chief Executive
Debtor Incorporation Number Office
------ --------------- ----------------- ---------------
South Hampton Refining Xx. Xxxxx 000000 Xxxxxxxx X. Xxxxxx
RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
XXXXX XXXXX L.L.P.
0000 XXXX XXXXXX
XXXXXX, XXXXX 00000
ATTN.: XXXX X. XXXXXX, ESQ.
NOTICE OF CONFIDENTIALITY RIGHTS:
IF YOU ARE A NATURAL PERSON, YOU MAY REMOVE OR STRIKE ANY OF THE FOLLOWING
INFORMATION FROM THIS INSTRUMENT BEFORE IT IS FILED FOR RECORD IN THE PUBLIC
RECORDS: YOUR SOCIAL SECURITY NUMBER OR YOUR DRIVER'S LICENSE NUMBER.
DEED OF TRUST, SECURITY AGREEMENT,
FINANCING STATEMENT, AND ASSIGNMENT OF RENTAL
THE STATE OF TEXAS )
) KNOW ALL PERSONS BY THESE PRESENTS:
COUNTY OF XXXXXX )
THIS DEED OF TRUST, SECURITY AGREEMENT, FINANCING STATEMENT, AND
ASSIGNMENT OF RENTAL dated as of June 1, 2004, but effective as of June 8, 2004
by SOUTH HAMPTON REFINING CO., a Texas corporation, whose address is X.X. Xxx
0000, Xxxxxxx, Xxxxx 00000, Attn: Xxxxxxxx X. Xxxxxx (herein "Grantor"), to Xxxx
X. Xxxxxx, whose address is 0000 Xxxx Xxxxxx, Xxxxxx, Xxxxx 00000, as Trustee
("Trustee") for the benefit of XXXXXX OPERATING PARTNERSHIP L.P., a Delaware
limited partnership (together with its successors and assigns, the
"Beneficiary"), whose address is 0000 Xxxxx Xxxx, Xxxxxxx, Xxxxx 00000, Attn:
Xxxxxx X. Xxxxxxxxx.
RECITALS
WHEREAS, as of April 30, 2004, Grantor owes the Beneficiary approximately
$7,000,000 for natural gasoline that it has purchased from the Beneficiary;
NOW THEREFORE, to secure (i) all indebtedness and accounts payable now
owed by Grantor to the Beneficiary, all additional indebtedness and accounts
payable hereafter owed by Grantor to the Beneficiary for or incident to the
purchase of natural gasoline and other inventory from the Beneficiary, all money
or credit heretofore or hereafter advanced by the Beneficiary to or for the
account of Grantor, and all other indebtedness and other amounts which may at
any time be owing by Grantor to the Beneficiary, pursuant to sales by the
Beneficiary to Grantor or otherwise, whether direct or indirect, absolute or
contingent, due or to become due, or now existing or hereafter incurred, and
whether evidenced by notes, open accounts, or otherwise, and the performance of
the covenants and agreements contained herein and in the other agreements
between Grantor and the Beneficiary to be performed by Grantor (including,
without limitation, that certain throughput arrangement to be entered into
between Grantor and the Beneficiary); and (ii) all advances for the payment of
taxes, assessments, insurance premiums and all other costs incurred for the
protection of the Mortgaged Property (all of the foregoing, together with all
costs, expenses and reasonable attorneys' fees incurred in connection with the
enforcement or collection thereof, collectively, the "Secured Indebtedness");
and also in consideration of the sum of TEN DOLLARS ($10.00) in hand paid, the
receipt and sufficiency of which is hereby acknowledged, Grantor hereby agrees
as follows:
ARTICLE 1.
CERTAIN DEFINITIONS,
GRANTING CLAUSES; SECURED INDEBTEDNESS
SECTION 1.1. CERTAIN DEFINITIONS AND REFERENCE TERMS. In addition to other
terms defined herein, each of the following terms shall have the meaning
assigned to it:
"Beneficiary" is defined in the preamble hereof.
"Code" means the Uniform Commercial Code as adopted in the State of Texas.
"Collateral" means all of Grantor's right, title, and interest, now owned
or hereafter acquired, in and to the following described properties and
interests and all replacements or substitutes therefor and all products and
proceeds thereof, and accessions thereto:
(a) All Personal Property; and
(b) All documents, insurance proceeds (including premium refunds),
leases, contract rights, and general intangibles now, or hereafter related
to, any of the Real Estate, including, without limitation, the following:
(i) All contracts now or hereafter entered into by and between
Grantor, as owner, and any "Original Contractor" (as such term is
defined in Section 53.001(7) of the Texas Property Code), or any
party, as well as all right, title, and interest of Grantor in, to,
and under any subcontracts, providing for the construction
(original, restorative or otherwise) of any of the Improvements, and
of any other buildings, structures or improvements to, or on, the
Real Estate (or any part thereof), or the furnishing of any
materials, supplies, equipment, or labor in connection with any such
construction;
(ii) All of the plans, specifications, and drawings
(including, without limitation, plot plans, foundation plans,
utility facilities plans, floor plans, elevations plans, framing
plans, cross-sections of walls plans, mechanical plans, electrical
plans, architectural and engineering plans and specifications, and
architectural and engineering studies and analyses) heretofore or
hereafter prepared by any architect or engineer with respect to any
of the Real Estate;
(iii) All agreements now or hereafter entered into with any
party with respect to architectural, engineering, management,
brokerage, promotional, marketing, or consulting services rendered
or to be rendered, with respect to the planning, design, inspection,
or supervision of the construction, development, management,
marketing, promotion, leasing, operation, or sale of any of the Real
Estate;
(iv) Any guarantees or completion bonds, performance bonds,
labor and material payment bonds, and any other bonds (and the
proceeds therefrom) relating to any of the Real Estate or to any
contract providing for construction of any of the
Page 2
Improvements or any other buildings, structures, or improvements to,
or on, any of the Real Estate;
(v) All rights or awards due to Grantor arising out of any
eminent domain proceedings for the taking or for loss of value of
any of the Real Estate;
(vi) All rents, issues, profits, and deposits due to Grantor,
as lessor, under any lease covering any of the Real Estate;
(vii) All trademarks, trade names, or symbols under which any
of the Real Estate is operated or the business of Grantor at the
Real Estate is conducted;
(viii) All engineering, accounting, title, legal, and other
technical or business data concerning the Mortgaged Property which
are in the possession of Grantor or in which Grantor can otherwise
grant a security interest;
(ix) All permits, licenses, franchises, certificates,
development rights, commitments and rights to utilities, and other
rights and privileges obtained by Grantor in connection with the
Real Estate;
(x) All books, records and computer software concerning the
Real Estate, the Personal Property, and the other property described
in clauses (ii) through (ix) above; and
(xi) All products and proceeds arising by virtue of any
transaction related to the disposition of any of the items described
in this definition above;
provided, that any of the foregoing which by its terms or by operation of
law is not assignable or would become void, voidable, terminable or
revocable if pledged or assigned hereunder is expressly excepted and
excluded from the terms of this Deed of Trust to the extent necessary so
as to avoid such violation of law or voidness, avoidability, terminability
or revocability;
"Deed of Trust" means this Deed of Trust, Security Agreement, Financing
Statement and Assignment of Rental, including all exhibits attached hereto, as
the same may, at any time and from time to time, be renewed, extended, modified
and/or increased.
"Event of Default" means the occurrence of any of the following:
(a) Grantor defaults in the payment or performance when due of any
Secured Indebtedness and such default is not cured within 10 days after
the Debtor receiving written notice of such default from the Beneficiary;
or
(b) Grantor fails to perform or comply with any term contained in
this Deed of Trust and, if capable of being cured, such default is not
cured within 30 days after the earlier of (i) a senior officer of Grantor
obtaining knowledge of such default and (ii) Grantor receiving written
notice of such default from the Beneficiary; or
(c) any lien or encumbrance (other than a Permitted Encumbrance) is
created or remains upon the Mortgaged Property if such lien or encumbrance
has priority over the lien and security interest created hereby in favor
of the Secured Party; or
Page 3
(d) Grantor becomes insolvent, makes an assignment for the benefit
of creditors, institutes or has instituted against it proceedings under
any bankruptcy or insolvency law, or Grantor has its stock in trade or any
part thereof levied upon or attached; or
(e) the commencement of dissolution or liquidation of Grantor as a
corporation; or
(f) determination by the Beneficiary that the Debtor has made or
furnished to the Beneficiary a false statement, representation or warranty
in a material respect; or
(g) occurrence of loss, damage or destruction of the Mortgaged
Property not covered by adequate insurance containing a loss payable
clause in favor of the Beneficiary.
"Grantor" has the meaning assigned to it in the preamble hereof.
"Grantor's Successors" means each and all of the successors, and assigns
of Grantor, both immediate and remote.
"Improvements" means all buildings, plants, structures, terminal
facilities, and other improvements now or hereafter constructed or located on
the Land to the extent owned by Grantor, and all fixtures and fixed equipment
whether real, personal or mixed, now or hereafter located on the Land or in any
such improvements, including, without limitation, all transmission lines,
heating, lighting, incinerating, and power equipment, engines, pipes, pipelines,
pumps, tanks, motors, conduits, switchboards, plumbing, lifting, cleaning, fire
prevention, fire extinguishing, refrigerating, ventilating, communications, air
cooling and air conditioning apparatus, elevators, windows, attached cabinets,
partitions, ducts and compressors, and including any of the foregoing that may
be subject to any title retention or security agreement superior in lien to the
lien of this Deed of Trust; it being understood and agreed that all of the
foregoing are part of the Mortgaged Property and appropriated to the use of the
Mortgaged Property and, whether affixed or annexed or not, shall be deemed to be
real estate and conveyed hereby.
"Land" means the parcel of land situated in Xxxxxx County, Texas, and more
fully described in Exhibit A attached hereto.
"Mortgaged Property" means the Real Estate and the Collateral,
collectively.
"Penreco Contract" means a processing agreement to be entered into between
Penreco and Grantor, such agreement to be in form and substance satisfactory to
the Beneficiary.
"Permitted Encumbrances" means (i) the liens and security interests
evidenced by this Deed of Trust and (ii) the liens and security interests
described on Exhibit B attached hereto.
"Personal Property" means all fixtures, building materials, machinery,
equipment, furniture, furnishings, systems, supplies and personal property in
which Grantor now has, or at any time hereafter acquires, an interest, and which
now, or at any time hereafter, are attached to or situated in, on or about the
Real Estate, all insurance proceeds covering the Real Estate, and all renewals
and replacements of, substitutions for and additions to the foregoing, but,
excluding any motor vehicles, mobile equipment or any other property subject to
certificate of title laws.
"Real Estate" means the Land, the Improvements, and all estates,
easements, licenses, interests, rights, titles, powers and privileges of every
kind and character which Grantor now has or at any time hereafter acquires, in
and to the Land and the Improvements, together with all rights of the Grantor,
if
Page 4
any, in the land lying in the bed of any street, road or avenue, opened or
proposed, in front of or adjoining the Land to the center line thereof, and all
rights of ingress and egress to and from the Land, and all remainders,
reversions and reversionary rights or interests related to the foregoing.
"Secured Indebtedness" has the meaning assigned to it in the recitals
hereof.
"Trustee" has the meaning assigned to it in the preamble and shall include
all substitute trustees appointed in conformity with Section 6.12.
SECTION 1.2. MORTGAGED PROPERTY. Grantor does hereby GRANT, BARGAIN, SELL,
CONVEY, TRANSFER, ASSIGN and SET OVER to Trustee the Mortgaged Property, subject
only to the Permitted Encumbrances; TO HAVE AND TO HOLD the Mortgaged Property,
together with all and singular the rights, hereditaments, and appurtenances in
anywise appertaining or belonging thereto, unto Trustee, and its or his
successors or substitutes in this trust, and to his or their successors and
assigns, in trust, however, upon the terms, provisions and conditions herein set
forth. Grantor, for Grantor and Grantor's successors, hereby agrees to warrant
and forever defend, all and singular, title to the Mortgaged Property unto
Trustee, and Trustee's successors or substitutes in this trust, forever, against
every person whomsoever lawfully claiming, or to claim, the same or any part
thereof, subject, however, to the Permitted Encumbrances.
SECTION 1.3. SECURITY INTEREST. Grantor hereby grants to the Beneficiary a
security interest in all of the Collateral. In addition to its rights hereunder
or otherwise, Beneficiary shall have all of the rights of a secured party under
the Code.
SECTION 1.4. SECURED INDEBTEDNESS; OTHER OBLIGATIONS. This Deed of Trust
is made to secure and enforce the payment and performance of the Secured
Indebtedness; provided, however, this Deed of Trust shall not secure any such
other loan, advance, debt, obligation or liability with respect to which
Beneficiary is by applicable law prohibited from obtaining a lien on real estate
nor shall this Section 1.4 operate or be effective to constitute or require any
assumption or payment by any person, in any way, of any debt of any other person
to the extent that the same would violate or exceed the limit provided in any
applicable usury or other law.
ARTICLE 2.
REPRESENTATIONS, WARRANTIES AND COVENANTS
SECTION 2.1. REPRESENTATIONS, WARRANTIES AND COVENANTS. Grantor expressly
represents and warrants to Beneficiary as follows:
(a) Grantor has full and lawful authority and power to execute,
acknowledge, deliver, and perform this Deed of Trust, and the same
constitutes the legal, valid, and binding obligations of Grantor,
enforceable against Grantor in accordance with its respective terms,
except as enforceability may be limited by applicable debtor relief laws
and general principles of equity;
(b) As of the date hereof, Grantor's principal office and mailing
address is set forth in the preamble hereof;
(c) Grantor is the lawful owner of good and indefeasible title to
the Land, and good title to the other Mortgaged Property;
Page 5
(d) All taxes, assessments and other charges levied against the
Mortgaged Property have been paid in full;
(e) The representations and warranties of Grantor shall at all times
be construed to be for the benefit of Beneficiary, and they shall remain
in full force and effect in all material respects, notwithstanding the
assignment hereof, or the partial release of the lien hereof, or any
foreclosure thereof; and
(f) There is no financing statement or other document creating or
evidencing a lien now on file in any public office covering any of the
Collateral or the Real Estate, or any lien or encumbrance on any of the
Collateral or the Real Estate, whether such Collateral and the Real Estate
shall be real or personal, tangible or intangible, or whether Grantor is
named or signed as Grantor, and until the termination of any mortgage or
deed of trust signed by it, Grantor will not execute and there will not be
on file in any public office any such financing statement or statements,
except as may have been or may hereafter be granted to Beneficiary, and
Grantor further agrees that it will not permit or suffer any security
interest, lien, or encumbrance upon any of the Collateral or the Real
Estate, except as may be granted to Beneficiary, except other Permitted
Encumbrances, and except liens, claims, or encumbrances contested under
Section 2.2(a) during the pendency of such contest. Notwithstanding the
foregoing, Grantor shall be permitted to grant a security interest, lien,
or encumbrance upon any of the Collateral or the Real Estate so long as
such security interest, lien, or encumbrance is (i) in favor of Arabian
American Development Co. or its subsidiaries and (ii) subordinated to the
security interest, lien and encumbrances herein created.
SECTION 2.2. COVENANTS. Grantor, for itself and Grantor's Successors,
covenants and agrees, with respect to the Mortgaged Property, that it shall:
(a) Pay, or cause to be paid, before delinquent, all lawful taxes
and assessments of every character in respect of any of the Mortgaged
Property, and from time to time, upon request of Beneficiary, to furnish
to Beneficiary evidence satisfactory to Beneficiary of the timely payment
of such taxes and assessments and to promptly pay all bills for labor and
materials incurred in connection with the Mortgaged Property and never to
permit to be fixed against the Mortgaged Property, or any part thereof,
any lien or security interest, other than Permitted Encumbrances, even
though inferior to the liens and security interests hereof, for any such
xxxx which may be legally due and payable. Notwithstanding anything to the
contrary contained in this Deed of Trust, Grantor (i) may contest the
validity or amount of any claim of any contractor, consultant, architect,
or other person providing labor, materials, or services with respect to
the Mortgaged Property, in the amount of such claim, (ii) may contest any
tax or special assessments levied by any governmental authority, and (iii)
may contest the enforcement of or compliance with any governmental
requirements, and such contest on the part of Grantor shall not constitute
an Event of Default if, during the pendency of any such contest, Grantor
shall set aside reserves or other provisions as required by generally
accepted accounting principles satisfactory to the Beneficiary or other
security acceptable to the Beneficiary in an amount equal to the amount
being contested plus a reasonable additional sum to cover possible costs,
interest, and penalties, and provided that Grantor shall pay any amount
adjudged by a court of competent jurisdiction to be due, with all costs,
interest, and penalties thereon, before such judgment becomes a lien on
the Mortgaged Property;
(b) Carry insurance with respect to the Mortgaged Property with
financially sound and reputable companies, such insurance policies to be
in such form and amounts and have such coverage as is customary and
reasonable for Grantor's business;
Page 6
(c) Cause all insurance carried by Grantor covering the Mortgaged
Property to be payable to Beneficiary as its interest may appear, and, in
the case of all policies of insurance carried by each lessee for the
benefit of Grantor, to cause all such policies to be payable to the
Beneficiary as its interest may appear;
(d) Pay, or cause to be paid, all premiums for such insurance before
such premiums become due, and upon request of the Beneficiary, to furnish
to the Beneficiary satisfactory proof of the timely making of such
payments;
(e) Comply with all valid governmental laws, ordinances, rules, and
regulations applicable to the Mortgaged Property and its ownership, use,
and operation, and to comply with all, and not violate any, easements,
restrictions, agreements, covenants, and conditions with respect to or
affecting the Mortgaged Property, or any part thereof, except where such
non-compliance or violation could not be reasonably expected to have a
material adverse effect on the Mortgaged Property, this Deed of Trust or
the business of Grantor;
(f) Without the prior written consent of the Beneficiary, not permit
to be created or exist in respect of the Mortgaged Property, or any part
thereof, any other or additional lien or security interest on a parity
with or superior or inferior to the liens and security interests hereof,
other than Permitted Encumbrances and any inferior liens or security
interests in favor of Arabian American Development Co. or its
subsidiaries; provided, however, if the Beneficiary so consents to the
creation of any such lien or security interest, Grantor covenants to
timely perform all covenants, agreements and obligations required to be
performed under or pursuant to the terms of any instrument or agreement
creating or giving rise to such lien or security interest;
(g) At any time, and from time to time, upon request by the
Beneficiary, forthwith to execute and deliver to the Beneficiary any and
all additional instruments and further assurances, and do all other acts
and things, as may be reasonably necessary or proper, in the Beneficiary's
reasonable opinion, to effect the intent of these presents, more fully
evidence and to perfect, the rights, titles, liens, and security interests
herein created or intended to be created and protect the rights, remedies,
powers, and privileges of Beneficiary hereunder;
(h) Not, without the prior written consent of the Beneficiary (which
consent may be withheld with or without cause), sell, trade, transfer,
assign, exchange, or otherwise dispose of the Mortgaged Property, or any
part thereof or any interest therein (whether legal or equitable in
nature);
(i) Punctually and properly to perform all of Grantor's covenants,
duties, and liabilities under this Deed of Trust, in accordance with the
terms thereof;
(j) Do all things necessary to diligently defend title to the
Mortgaged Property, but the Beneficiary shall have the right, upon the
occurrence and during the continuation of any Event of Default, to
intervene in any suit affecting such title and to employ independent
counsel in connection with any such suit to which it may be a party by
intervention or otherwise; and pay the Beneficiary all reasonable expenses
paid or incurred by the Beneficiary in respect of any such suit in which
Grantor intervenes as a result of exercising the foregoing right,
including reasonable fees to Beneficiary's attorneys, and Grantor, will
indemnify and hold harmless Beneficiary from any and all cost, loss,
damage or liability which Beneficiary may suffer or incur by reason of the
breach by Grantor of any representation or covenant or warranty regarding
title to all or any part of the Mortgaged Property or by reason of the
failure or inability of Grantor, for any reason, to
Page 7
convey the rights, titles and interests which this Deed of Trust purports
to mortgage and all amounts at any time so payable by Borrower or Grantor
hereunder shall be secured by the lien of this Deed of Trust;
(k) Protect, warrant and forever defend title to the Mortgaged
Property unto Beneficiary, its successors and assigns, at Grantor's
expense, against all persons whomsoever lawfully having or claiming an
interest therein or a lien thereon, subject to Permitted Encumbrances;
(l) Promptly to deliver to the Beneficiary a copy of any notice or
other instrument received by Grantor which might materially adversely
affect the liens or security interests securing the Secured Indebtedness;
(m) Grantor will not at any time insist upon, or plead, or in any
manner whatever claim or take any benefit or advantage of any stay or
extension or moratorium law, any exemption from execution or sale of the
Mortgaged Property, or any part thereof, whenever enacted, now or at any
time hereafter enforced, which may affect the covenants and terms of
performance of this Deed of Trust, nor claim, take or insist upon any
benefit or advantage of any law now or hereafter enforced 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 competent jurisdiction; nor, after 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 thereof and Grantor hereby
expressly waives all benefit or advantage of any such law or laws and
covenants not to hinder, delay or impede the execution of any power herein
granted or delegated to Trustee or Beneficiary, but to suffer and permit
the execution of every power as though no such law or laws had been made
or enacted; and
(n) Grantor will not, in any calendar month, distribute cash or
other property to its shareholders having an aggregate value in excess of
$50,000; provided that (i) such distributions may be in an aggregate
amount not to exceed $70,000 per month for the twelve months immediately
following the commencement of operations under the Penreco Contract, and
(ii) after the Penreco Contract has been executed by all parties thereto,
South Hampton may make a one-time distribution to its shareholders in an
aggregate amount not to exceed $300,000.
SECTION 2.3. WAIVERS. Any and all covenants in this Deed of Trust may from
time to time, by instrument in writing signed by the Beneficiary and delivered
to Grantors, be waived to such extent and in such manner as the Beneficiary may
desire, but no such waiver shall ever affect or impair Beneficiary's rights or
liens hereunder, except to the extent so specifically stated in such written
instrument. Impossibility shall not excuse the performance of any covenant or
condition in this Deed of Trust.
SECTION 2.4. DESTRUCTION; CONDEMNATION.
(a) Destruction; Insurance Proceeds. If there shall occur any damage
to, or loss or destruction of, any of the Improvements, or any part of any
thereof (each, a "Destruction"), Grantor shall promptly send to the
Beneficiary a notice setting forth the nature and extent of such
Destruction. The proceeds of any insurance payable in respect of such
Destruction shall be paid to the Beneficiary and applied in accordance
with Section 4.3, provided that the Beneficiary may release such funds to
Grantor for restoration of the Improvements in the Beneficiary's sole
reasonable discretion.
Page 8
(b) Condemnation; Assignment of Award. If there shall occur any
taking of the Mortgaged Property or any part thereof, in or by
condemnation or other eminent domain proceedings pursuant to any law,
general or special, or by reason of the temporary requisition of the use
or occupancy of the Mortgaged Property or any part thereof, by any
governmental authority, civil or military (each, a "Taking"), Grantor
shall immediately notify the Beneficiary upon receiving notice of such
Taking or commencement of proceedings therefor. The Beneficiary may
participate in any proceedings or negotiations which might result in any
Taking, and Grantor shall deliver or cause to be delivered to the
Beneficiary all instruments requested by it to permit such participation.
If the Beneficiary determines Grantor or its counsel is not acting in a
manner consistent with the best interests of the Beneficiary, the
Beneficiary may be represented by counsel satisfactory to it in connection
with any such participation. Any proceeds, award or payment in respect of
any Taking are hereby assigned and shall be paid to the Beneficiary.
Grantor shall take all steps necessary to notify the condemning authority
of such assignment. Such proceeds, award or payment, together with any
interest earned thereon, less the amount of any reasonable expenses
incurred in litigating, arbitrating, compromising or settling any claim
arising out of such Taking, shall be applied in accordance with Section
4.3 hereof.
SECTION 2.5. ABSENCE OF OBLIGATIONS OF THE BENEFICIARY WITH RESPECT TO
MORTGAGED PROPERTY. Notwithstanding anything in this Deed of Trust to the
contrary, including, without limitation, the definition of "Mortgaged Property"
and/or the provisions of Article 3 hereof, (i) to the extent permitted by
applicable law, the Mortgaged Property is composed of Grantor's rights, title
and interests therein but not Grantor's obligations, duties or liabilities
pertaining thereto, (ii) the Beneficiary neither assumes nor shall have any
obligations, duties or liabilities in connection with any portion of the items
described in the definition of "Mortgaged Property" herein, either prior to or
after obtaining title to such Mortgaged Property, whether by foreclosure sale,
the granting of a deed in lieu of foreclosure or otherwise, and (iii) the
Beneficiary may, at any time prior to or after the acquisition of title to any
portion of the Mortgaged Property as above described, advise any party in
writing as to the extent of the Beneficiary's interest therein and/or expressly
disaffirm in writing any rights, interests, obligations, duties and/or
liabilities with respect to such Mortgaged Property or matters related thereto.
Without limiting the generality of the foregoing, it is understood and agreed
that the Beneficiary shall have no obligations, duties, or liabilities prior to
or after acquisition of title to any portion of the Mortgaged Property, as
lessee under any lease or purchaser or seller under any contract or option
unless the Beneficiary elects otherwise by written notification to Grantor or
otherwise agrees with any such lessor, lessee, purchaser or seller.
SECTION 2.6. PROHIBITIONS ON SALE, TRANSFER, ETC. If all or any portion of
the Mortgaged Property is sold, transferred, assigned or conveyed voluntarily or
by operation of law, the Beneficiary may, at its option, declare the entire
indebtedness secured hereby to be immediately due and payable.
SECTION 2.7. RECORDATION. Grantor shall comply or cause compliance with
all such statutes and regulations, as may be required by law in order to
establish, preserve and protect the lien of this Deed of Trust as a valid,
direct first mortgage lien on the Mortgaged Property, including all right, title
and interest of Grantor in and to all property required by this Deed of Trust to
be subject to the lien hereof and acquired by Grantor after the date of this
Deed of Trust, subject only to the Permitted Encumbrances.
ARTICLE 3.
DEFAULT
SECTION 3.1. EVENTS OF DEFAULT; INDEBTEDNESS DUE. If any one or more
Events of Default shall occur then, the Beneficiary shall have the right, at its
option, to declare the entire indebtedness secured hereby to be immediately due
and payable.
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ARTICLE 4.
REMEDIES
SECTION 4.1. CERTAIN REMEDIES. If an Event of Default shall have occurred
and be continuing, the Beneficiary may (but shall have no obligation to)
exercise any one or more of the following remedies, without notice (unless
notice is required by applicable law):
(a) Foreclosure. Trustee, or his successor or substitute, is
authorized and empowered and it shall be his special duty at the request
of the Beneficiary to sell the Mortgaged Property or any part thereof
situated in the State of Texas, at the location at the county courthouse
specified by the commissioner's court of the county in the State of Texas
wherein the Land then subject to the lien hereof is situated or, if no
such location is specified by the commissioner's court, then at the
location at the courthouse specified in the Beneficiary's notice of such
sale to Grantor; provided, that if the Land is situated in more than one
county, then such sale of the Mortgaged Property, or part thereof, may be
made at the courthouse in any county in the State of Texas wherein any
part of the Land then subject to the lien hereof is situated. Any such
sale shall be for cash or credit, as directed by the Beneficiary, between
the hours of ten o'clock (10:00) A.M. and four o'clock (4:00) P.M. on the
first (1st) Tuesday in any month or on such date and at such time as is
then required by applicable law. Written or printed notice of such sale
shall be posted at the courthouse door in the county, or if more than one,
then in each of the counties, wherein the Land then subject to the lien
hereof is situated. Such notice shall designate the county where the
Mortgaged Property, or part thereof, will be sold and the earliest time at
which the sale will occur, and such notice shall be posted at least
twenty-one (21) days prior to the date of sale (or such earlier date as is
required by applicable law). Such notice shall also be filed with the
county clerk in the county, or if more than one, then in each of the
counties wherein the Land is located. The Beneficiary shall, or shall
direct the Trustee or any substitute trustee, at least twenty-one (21)
days preceding the date of sale (or such earlier date as is required by
applicable law), serve written notice of the proposed sale by certified
mail on each debtor obligated to pay the Secured Indebtedness according to
the records of the Beneficiary. It shall not be necessary to have present
or to exhibit at any such sale any of the Personal Property. Any sale made
by Trustee hereunder may be as an entirety or in such parcels as the
Beneficiary may request. To the extent permitted by applicable law, any
sale may be adjourned by announcement at the time and place appointed for
such sale without further notice except as may be required by law. The
sale by Trustee of less than the whole of the Mortgaged Property shall not
exhaust the power of sale herein granted, and Trustee is specifically
empowered to make successive sale or sales under such power until the
whole of the Mortgaged Property shall be sold; and, if the proceeds of
such sale of less than the whole of the Mortgaged Property shall be less
than the aggregate of the indebtedness secured hereby and the expense of
executing this trust as provided herein, this Deed of Trust and the lien
hereof shall remain in full force and effect as to the unsold portion of
the Mortgaged Property just as though no sale had been made; provided,
however, that Grantor shall never have any right to require the sale of
less than the whole of the Mortgaged Property but the Beneficiary shall
have the right, at its sole election, to request Trustee to sell less than
the whole of the Mortgaged Property. Trustee may, after any request or
direction by the Beneficiary, sell not only the real property but also the
Collateral and other interest which are a part of the Mortgaged Property,
or any part thereof, as a unit and as a part of a single sale, or may sell
any part of the Mortgaged Property separately from the remainder of the
Mortgaged Property. It shall not be necessary for Trustee to have taken
possession of any part of the Mortgaged Property or to have present or to
exhibit at any sale any of the Collateral. After each sale, Trustee shall
make to the purchaser or purchasers at such sale good and sufficient
conveyances in the name of Grantor, conveying the
Page 10
property so sold to the purchaser or purchasers with general warranty of
title by Grantor, subject to the Permitted Encumbrances (and to such
leases and other matters, if any, as Trustee may elect upon request of the
Beneficiary), and shall receive the proceeds of said sale or sales and
apply the same as herein provided. Payment of the purchase price to the
Trustee shall satisfy the obligation of purchaser at such sale therefor,
and such purchaser shall not be responsible for the application thereof.
The power of sale granted herein shall not be exhausted by any sale held
hereunder by Trustee or his substitute or successor, and such power of
sale may be exercised from time to time and as many times as the
Beneficiary may deem necessary until all of the Mortgaged Property has
been duly sold and all Secured Indebtedness has been fully paid. In the
event any sale hereunder is not completed or is defective in the opinion
of the Beneficiary, such sale shall not exhaust the power of sale
hereunder and the Beneficiary shall have the right to cause a subsequent
sale or sales to be made hereunder. Any and all statements of fact or
other recitals made in any deed or deeds or other conveyances given by
Trustee or any successor or substitute appointed hereunder as to
nonpayment of the Secured Indebtedness or as to the occurrence of any
default, or as to the Beneficiary's having declared all of said
indebtedness to be due and payable, or as to the request to sell, or as to
notice of time, place and terms of sale and the properties to be sold
having been duly given or as to the refusal, failure or inability to act
of Trustee or any substitute or successor trustee, or as to the
appointment of any substitute or successor trustee, or as to any other act
or thing having been duly done by the Beneficiary or by such Trustee,
substitute or successor, shall be taken as prima facie evidence of the
truth of the facts so stated and recited. The Trustee or his successor or
substitute may appoint or delegate any one or more persons as agent to
perform any act or acts necessary or incident to any sale held by Trustee,
including the posting of notices and the conduct of sale, but in the name
and on behalf of Trustee, his successor or substitute. If Trustee or his
successor or substitute shall have given notice of sale hereunder, any
successor or substitute Trustee thereafter appointed may complete the sale
and the conveyance of the property pursuant thereto as if such notice had
been given by the successor or substitute Trustee conducting the sale.
(b) Uniform Commercial Code. Without limitation of the Beneficiary's
rights of enforcement with respect to the Collateral or any part thereof
in accordance with the procedures for foreclosure of real estate, the
Beneficiary may exercise its rights of enforcement with respect to the
Collateral or any part thereof under the Code (or under the Uniform
Commercial Code in force in any other state to the extent the same is
applicable law) and in conjunction with, in addition to or in substitution
for those rights and remedies: (1) the Beneficiary may enter upon
Grantor's premises to take possession of, assemble and collect the
Collateral or, to the extent and for those items of the Collateral
permitted under applicable law, to render it unusable (provided that the
Grantor may at its own cost, after reasonable notice and during normal
business hours, make copies of any records which the Beneficiary takes
possession of under this Section 4.1(b) and shall thereafter have
reasonable access to such records upon reasonable prior notice); (2) the
Beneficiary may require Grantor to assemble the Collateral and make it
available at a place the Beneficiary designates which is mutually
convenient to allow the Beneficiary to take possession or dispose of the
Collateral; (3) written notice mailed to Grantor as provided herein at
least ten (10) days prior to the date of public sale of the Collateral or
prior to the date after which private sale of the Collateral will be made
shall constitute reasonable notice; (4) any sale made pursuant to the
provisions of this paragraph shall be deemed to have been a public sale
conducted in a commercially reasonable manner if held contemporaneously
with and upon the same notice as required for the sale of the Mortgaged
Property under power of sale as provided in paragraph (c) above in this
Section 4.1; (5) in the event of a foreclosure sale, whether made by
Trustee under the terms hereof, or under judgment of a court, the
Collateral and the other Mortgaged Property may, at the option of the
Beneficiary, be sold as a whole; (6) it shall not be necessary that the
Beneficiary take possession of the Collateral or any part thereof prior to
the time that any sale
Page 11
pursuant to the provisions of this Section is conducted and it shall not
be necessary that the Collateral or any part thereof be present at the
location of such sale; (7) with respect to application of proceeds of
disposition of the Collateral under Section 4.3 hereof, the costs and
expenses incident to disposition shall include the reasonable expenses of
retaking, holding, preparing for sale or lease, selling, leasing and the
like and the reasonable attorneys' fees and legal expenses incurred by the
Beneficiary; (8) any and all statements of fact or other recitals made in
any xxxx of sale or assignment or other instrument evidencing any
foreclosure sale hereunder as to nonpayment of the Secured Indebtedness or
as to the occurrence of any default, or as to the Beneficiary having
declared all of such indebtedness to be due and payable, or as to notice
of time, place and terms of sale and of the properties to be sold having
been duly given, or as to any other act or thing having been duly done by
the Beneficiary, shall be taken as prima facie evidence of the truth of
the facts so stated and recited; and (9) the Beneficiary may appoint or
delegate any one or more persons as agent to perform any act or acts
necessary or incident to any sale held by the Beneficiary, including the
sending of notices and the conduct of the sale, but in the name and on
behalf of the Beneficiary.
(c) Lawsuits. The Beneficiary may proceed by a suit or suits in
equity or at law, whether for collection of the indebtedness secured
hereby, the specific performance of any covenant or agreement herein
contained or in aid of the execution of any power herein granted, or for
any foreclosure hereunder or for the sale of the Mortgaged Property under
the judgment or decree of any court or courts of competent jurisdiction.
(d) Entry on Mortgaged Property. The Beneficiary is authorized,
prior or subsequent to the institution of any foreclosure proceedings, to
the fullest extent permitted by applicable law, subject to Grantor's
rights under any lease, to enter upon the Mortgaged Property, or any part
thereof, and to take possession of the Mortgaged Property and all books
and records relating thereto, and to exercise without interference from
Grantor any and all rights which Grantor has with respect to the
management, possession, operation, protection or preservation of the
Mortgaged Property. The Beneficiary shall not be deemed to have taken
possession of the Mortgaged Property or any part thereof except upon the
exercise of its right to do so, and then only to the extent evidenced by
its demand and overt act specifically for such purpose. All costs,
expenses and liabilities of every character incurred by the Beneficiary in
managing, operating, maintaining, protecting or preserving the Mortgaged
Property after taking possession of the Mortgaged Property and in
preparation for any foreclosure sale shall constitute a demand obligation
of Grantor (which obligation Grantor hereby promises to pay) to the
Beneficiary pursuant to this Deed of Trust. If necessary to obtain the
possession provided for above, the Beneficiary may invoke any and all
legal remedies to dispossess Grantor. In connection with any action taken
by the Beneficiary pursuant to this Section, the Beneficiary shall not be
liable for any loss sustained by Grantor resulting from any failure to let
the Mortgaged Property or any part thereof, or from any act or omission of
the Beneficiary in managing the Mortgaged Property unless such loss is
caused by the gross negligence or willful misconduct and bad faith of the
Beneficiary, nor shall the Beneficiary be obligated to perform or
discharge any obligation, duty or liability of Grantor arising under any
lease or other agreement relating to the Mortgaged Property or arising
under any Permitted Encumbrance or otherwise arising. Grantor hereby
assents to, ratifies and confirms any and all actions of the Beneficiary
with respect to the Mortgaged Property taken under this Section.
(e) Receiver. The Beneficiary shall as a matter of right be entitled
to the appointment of a receiver or receivers for all or any part of the
Mortgaged Property, whether such receivership be incident to a proposed
sale (or sales) of such property or otherwise, and without regard to the
value of the Mortgaged Property or the solvency of any person or persons
liable for
Page 12
the payment of the indebtedness secured hereby, and Grantor does hereby
irrevocably consent to the appointment of such receiver or receivers,
waives any and all defenses to such appointment, agrees not to oppose any
application therefor by the Beneficiary, and agrees that such appointment
shall in no manner impair, prejudice or otherwise affect the rights of the
Beneficiary to application of Rents as provided in this Deed of Trust.
Nothing herein is to be construed to deprive the Beneficiary of any other
right, remedy or privilege it may have under the law to have a receiver
appointed. Any money advanced by the Beneficiary in connection with any
such receivership shall be a demand obligation (which obligation Grantor
hereby promises to pay) owing by Grantor to the Beneficiary pursuant to
this Deed of Trust.
(f) Other Rights and Remedies. The Beneficiary may exercise any and
all other rights and remedies which the Beneficiary may have under any
other agreement between the Beneficiary and Grantor, or at law or in
equity or otherwise.
SECTION 4.2. EFFECTIVE AS MORTGAGE. This instrument shall be effective as
a mortgage as well as a deed of trust and upon the occurrence and during the
continuation of an Event of Default may be foreclosed as to any of the Mortgaged
Property in any manner permitted by applicable law, and any foreclosure suit may
be brought by Trustee or by the Beneficiary; and to the extent, if any, required
to cause this instrument to be so effective as a mortgage as well as a deed of
trust, Grantor hereby mortgages the Mortgaged Property to the Beneficiary. In
the event a foreclosure hereunder shall be commenced by Trustee, or his
substitute or successor, the Beneficiary may at any time before the sale of the
Mortgaged Property direct Trustee to abandon the sale, and may then institute
suit for the collection of the Notes and/or any other Secured Indebtedness, and
for the foreclosure of this Deed of Trust. It is agreed that if the Beneficiary
should institute a suit for the collection of the Notes or any other Secured
Indebtedness and for the foreclosure of this Deed of Trust, the Beneficiary may
at any time before the entry of a final judgment in said suit dismiss the same,
and require Trustee, his substitute or successor to sell the Mortgaged Property
in accordance with the provisions of this Deed of Trust.
SECTION 4.3. PROCEEDS OF FORECLOSURE. The proceeds of any sale held by
Trustee or the Beneficiary or any receiver or public officer in foreclosure of
the liens and security interest evidenced hereby shall be applied: FIRST, to the
payment of all necessary costs and expenses incident to such foreclosure sale,
including but not limited to all attorneys' fees and legal expenses, all court
costs and charges of every character, and to the payment of the other Secured
Indebtedness, the order and manner of application to the items in this clause
FIRST to be in the Beneficiary's sole discretion; and SECOND, the remainder, if
any there shall be, shall be paid to Grantor, or to Grantor's heirs, devisees,
representatives, successors or assigns, or such other persons (including the
Beneficiary or the Beneficiary of any inferior lien) as may be entitled thereto
by law; provided, however, that if the Beneficiary is uncertain which person or
persons are so entitled, the Beneficiary may interplead such remainder in any
court of competent jurisdiction, and the amount of any attorneys' fees, court
costs and expenses incurred in such action shall be a part of the Secured
Indebtedness and shall be reimbursable (without limitation) from such remainder.
SECTION 4.4. THE BENEFICIARY AS PURCHASER. The Beneficiary shall have the
right to become the purchaser at any sale held by Trustee or substitute or
successor or by any receiver or public officer or at any public sale, and the
Beneficiary shall have the right to credit upon the amount of the Beneficiary's
successful bid, to the extent necessary to satisfy such bid, all or any part of
the Secured Indebtedness in such manner and order as the Beneficiary may elect.
SECTION 4.5. FORECLOSURE AS TO MATURED DEBT. Upon the occurrence and
during the continuation of an Event of Default, the Beneficiary shall have the
right to proceed with foreclosure (judicial or nonjudicial) of the liens and
security interests hereunder without declaring the entire Secured
Page 13
Indebtedness due, and in such event any such foreclosure sale may be made
subject to the unmatured part of the Secured Indebtedness; and any such sale
shall not in any manner affect the unmatured part of the Secured Indebtedness,
but as to such unmatured part this Deed of Trust shall remain in full force and
effect just as though no sale had been made. The proceeds of such sale shall be
applied as provided in Section 4.3 hereof except that the amount paid under
clause FIRST thereof shall be only the matured portion of the Secured
Indebtedness and any proceeds of such sale in excess of those provided for in
clause FIRST (modified as provided above) shall be applied to the prepayment
(without penalty) of any other Secured Indebtedness in such manner and order and
to such extent as the Beneficiary deems advisable, and the remainder, if any,
shall be applied as provided in clause SECOND of Section 4.3 hereof. Several
sales may be made hereunder without exhausting the right of sale for any
unmatured part of the Secured Indebtedness.
SECTION 4.6. REMEDIES CUMULATIVE. All rights and remedies provided for
herein and in any other agreement between the Beneficiary and Grantor are
cumulative of each other and of any and all other rights and remedies existing
at law or in equity, and Trustee and the Beneficiary shall, in addition to the
rights and remedies provided herein or in any other agreement between the
Beneficiary and Grantor, be entitled to avail themselves of all such other
rights and remedies as may now or hereafter exist at law or in equity for the
collection of the Secured Indebtedness and the enforcement of the covenants
herein and the foreclosure of the liens and security interests evidenced hereby,
and the resort to any right or remedy provided for hereunder or under any such
other agreement between the Beneficiary and Grantor or provided for by law or in
equity shall not prevent the concurrent or subsequent employment of any other
appropriate right or rights or remedy or remedies.
SECTION 4.7. THE BENEFICIARY'S DISCRETION AS TO SECURITY. The Beneficiary
may resort to any security given by this Deed of Trust or to any other security
now existing or hereafter given to secure the payment of the Secured
Indebtedness, in whole or in part, and in such portions and in such order as may
seem best to the Beneficiary in its sole and uncontrolled discretion, and any
such action shall not in any way be considered as a waiver of any of the rights,
benefits, liens or security interests evidenced by this Deed of Trust.
SECTION 4.8. GRANTOR'S WAIVER OF CERTAIN RIGHTS. To the full extent
Grantor may do so, Grantor agrees that Grantor will not at any time insist upon,
plead, claim or take the benefit or advantage of any law now or hereafter in
force providing for any appraisement, valuation, stay, extension or redemption,
and Grantor, for Grantor, Grantor's heirs, devisees, representatives, successors
and assigns, and for any and all persons ever claiming any interest in the
Mortgaged Property, to the extent permitted by applicable law, hereby waives and
releases all rights of redemption, valuation, appraisement, stay of execution,
notice of intention to mature or declare due the whole of the Secured
Indebtedness, notice of election to mature or declare due the whole of the
Secured Indebtedness and all rights to a marshaling of assets of Grantor,
including the Mortgaged Property, or to a sale in inverse order of alienation in
the event of foreclosure of the liens and/or security interests hereby created
Grantor shall not have or assert any right under any statute or rule of law
pertaining to the marshaling of assets, sale in inverse order of alienation, the
exemption of homestead, the administration of estates of decedents, or other
matters whatever to defeat, reduce or affect the right of the Beneficiary under
the terms of this Deed of Trust to a sale of the Mortgaged Property for the
collection of the Secured Indebtedness without any prior or different resort for
collection, or the right of the Beneficiary under the terms of this Deed of
Trust to the payment of the Secured Indebtedness out of the proceeds of sale of
the Mortgaged Property in preference to every other claimant whatsoever. If any
law referred to in this Section and now in force, of which Grantor or Grantor's
heirs, devisees, representatives, successors or assigns or any other persons
claiming any interest in the Mortgaged Property might take advantage despite
this Section, shall hereafter be repealed or cease to be in force, such law
shall not thereafter be deemed to preclude the application of this Section.
Page 14
SECTION 4.9. DELIVERY OF POSSESSION AFTER FORECLOSURE. In the event there
is a foreclosure sale hereunder and at the time of such sale, Grantor or
Grantor's heirs, devisees, representatives, successors or assigns are occupying
or using the Mortgaged Property, or any part thereof, each and all shall
immediately become the tenant of the purchaser at such sale, which tenancy shall
be a tenancy from day to day, terminable at the will of either landlord or
tenant, at a reasonable rental per day based upon the value of the property
occupied, such rental to be due daily to the purchaser; and to the extent
permitted by applicable law, the purchaser at such sale shall, notwithstanding
any language herein apparently to the contrary, have the sole option to demand
immediate possession following the sale or to permit the occupants to remain as
tenants at will. In the event the tenant fails to surrender possession of said
property upon demand, the purchaser shall be entitled to institute and maintain
a summary action for possession of the property (such as an action for forcible
detainer) in any court having jurisdiction.
ARTICLE 5.
LEASES AND ASSIGNMENT OF RENTAL
SECTION 5.1. DEFINITIONS. As used in this Deed of Trust: (i) "Lease" means
any ground lease, space lease, sublease or other agreement (oral or written)
under the terms of which any person other than Grantor has or acquires any right
to occupy, use, or manage the Mortgaged Property, or any part thereof, or
interest therein; (ii) "Lessee" means the lessee, sublessee, tenant or other
person having the right to occupy, use, or manage the Mortgaged Property, or any
part thereof, under a Lease; and (iii) "Rental" means the rents, issues,
profits, royalties, bonuses, revenue, income and other benefits derived from the
Mortgaged Property or arising from the use or enjoyment of any portion thereof
or from any Lease and liquidated damages following defaults under any Lease, and
all proceeds payable under any policy of insurance covering loss of rents,
together with any and all rights which Grantor may have against any tenant under
any Lease.
SECTION 5.2. ASSIGNMENT OF RENTALS. Grantor hereby assigns to the
Beneficiary all Rental payable under each Lease now or at any time hereafter
existing, such assignment being upon the following terms:
(a) Upon the occurrence and during the continuation of any Event of
Default, Grantor shall, upon the request of the Beneficiary, cause each
Lessee to pay Rental directly to the Beneficiary, such Rental to be
applied as provided in Section 4.3, and
(b) The Beneficiary shall not be liable for such party's failure to
collect, or its failure to exercise diligence in the collection of,
Rental, but shall be accountable only for Rental that it shall actually
receive.
This assignment is in addition and in supplement to, and the Beneficiary's
rights and remedies under this Article 5 are cumulative of, the Beneficiary's
rights and remedies under any other document or assignment concerning or
applicable to each Lease now or at any time hereafter existing or Rentals
thereunder, or any part thereof.
As between the Beneficiary and Grantor, and any person claiming through or
under Grantor, the assignment contained in this Section 5.2 is intended to be
absolute, unconditional and presently effective, and the provisions of
Subsections 5.2(a) and (b) are intended solely for the benefit of each Lessee
and shall never inure to the benefit of Grantor or any person claiming through
or under Grantor, or a Lessee who has not received such notice. It shall never
be necessary for the Beneficiary to institute legal proceedings of any kind
whatsoever to enforce the provisions of this Section 5.2.
Page 15
SECTION 5.3. EFFECT ON LEASES. Nothing in this Article 5 shall ever be
construed as subordinating this Deed of Trust to any Lease; provided, however,
that any proceedings by the Beneficiary to foreclose this Deed of Trust, or any
action by way of its entry into possession after an Event of Default, shall not
operate to terminate any Lease which has been approved in writing by the
Beneficiary to the Lessee thereunder, and the Beneficiary will not cause any
Lessee under any such approved Lease to be disturbed in his possession and
enjoyment of the leased premises so long as such Lessee shall continue to fully
and promptly pay the Rental and perform all of the terms, covenants and
provisions of such Lessee's Lease.
ARTICLE 6.
MISCELLANEOUS
SECTION 6.1. SCOPE OF DEED OF TRUST. This Deed of Trust is a deed of trust
and mortgage of both real and personal property, a security agreement, a
financing statement and a collateral assignment, and also covers proceeds and
fixtures.
SECTION 6.2. EFFECTIVE AS A FINANCING STATEMENT. This Deed of Trust shall
be effective as a financing statement filed as a fixture filing with respect to
all fixtures included within the Mortgaged Property and is to be filed for
record in the real estate records of each county where any part of the Mortgaged
Property (including said fixtures) is situated. This Deed of Trust shall also be
effective as a financing statement covering any other Mortgaged Property and may
be filed in any other appropriate filing or recording office. The mailing
address of Grantor is the address of Grantor set forth in the preamble of this
Deed of Trust and the address of the Beneficiary from which information
concerning the security interests hereunder may be obtained is the address of
the Beneficiary set forth in the preamble of this Deed of Trust. A carbon,
photographic or other reproduction of this Deed of Trust or of any financing
statement relating to this Deed of Trust shall be sufficient as a financing
statement for any of the purposes referred to in this Section.
SECTION 6.3. WAIVER BY THE BENEFICIARY. The Beneficiary may at any time
and from time to time by a specific writing intended for the purpose: (a) waive
compliance by Grantor with any covenant herein made by Grantor to the extent and
in the manner specified in such writing; (b) consent to Grantor's doing any act
which hereunder Grantor is prohibited from doing, or to Grantor's failing to do
any act which hereunder Grantor is required to do, to the extent and in the
manner specified in such writing; (c) release any part of the Mortgaged Property
or any interest therein from the lien and security interest of this Deed of
Trust, without the joinder of Trustee; or (d) release any party liable, either
directly or indirectly, for the Secured Indebtedness or for any covenant herein
or in any other agreement between the Beneficiary and Grantor, without impairing
or releasing the liability of any other party. No such act shall in any way
affect the rights or powers of the Beneficiary or Trustee hereunder except to
the extent specifically agreed to by the Beneficiary in such writing.
SECTION 6.4. NO IMPAIRMENT OF SECURITY. The lien, security interest and
other security rights of the Beneficiary hereunder or under any other agreement
between the Beneficiary and Grantor shall not be impaired by any indulgence,
moratorium or release granted by the Beneficiary including, but not limited to,
any renewal, extension or modification which the Beneficiary may grant with
respect to any Secured Indebtedness, or any surrender, compromise, release,
renewal, extension, exchange or substitution which the Beneficiary may grant in
respect of the Mortgaged Property, or any part thereof or any interest therein
or any release or indulgence granted to any endorser, guarantor or surety of any
Secured Indebtedness. The taking of additional security by the Beneficiary shall
not release or impair the lien, security interest or other security rights of
the Beneficiary hereunder or affect the liability of Grantor
Page 16
or of any endorser, guarantor or surety, or improve the right of any junior
lienholder in the Mortgaged Property (without implying hereby the Beneficiary's
consent to any junior lien).
SECTION 6.5. ACTS NOT CONSTITUTING WAIVER BY THE BENEFICIARY. The
Beneficiary may waive any default without waiving any other prior or subsequent
default. The Beneficiary may remedy any default without waiving the default
remedied. Neither failure by the Beneficiary to exercise, nor delay by the
Beneficiary in exercising, nor discontinuance of the exercise of any right,
power or remedy (including but not limited to the right to accelerate the
maturity of the Secured Indebtedness or any part thereof) upon or after any
default shall be construed as a waiver of such default or as a waiver of the
right to exercise any such right, power or remedy at a later date. No single or
partial exercise by the Beneficiary of any right, power or remedy hereunder
shall exhaust the same or shall preclude any other or further exercise thereof,
and every such right, power or remedy hereunder may be exercised at any time and
from time to time. No modification or waiver of any provision hereof nor consent
to any departure by Grantor therefrom shall in any event be effective unless the
same shall be in writing and signed by the Beneficiary and then such waiver or
consent shall be effective only in the specific instance, for the purpose for
which given and to the extent therein specified. No notice to nor demand on
Grantor in any case shall of itself entitle Grantor to any other or further
notice or demand in similar or other circumstances. Remittances in payment of
any part of the Secured Indebtedness other than in the required amount in
immediately available U.S. funds shall not, regardless of any receipt or credit
issued therefor, constitute payment until the required amount is actually
received by the Beneficiary in immediately available U.S. funds and shall be
made and accepted subject to the condition that any check or draft may be
handled for collection in accordance with the practice of the collecting bank or
banks. Acceptance by the Beneficiary of any payment in an amount less than the
amount then due on any Secured Indebtedness shall be deemed an acceptance on
account only and shall not in any way excuse the existence of a default
hereunder.
SECTION 6.6. [INTENTIONALLY OMITTED.]
SECTION 6.7. GRANTOR'S SUCCESSORS. If the ownership of the Mortgaged
Property or any part thereof becomes vested in a person other than Grantor, the
Beneficiary may, without notice to Grantor, deal with such successor or
successors in interest with reference to this Deed of Trust and to the
indebtedness secured hereby in the same manner as with Grantor, without in any
way vitiating or discharging Grantor's liability hereunder or for the payment of
the indebtedness or performance of the obligations secured hereby. No transfer
of the Mortgaged Property, no forbearance on the part of the Beneficiary, and no
extension of the time for the payment of the indebtedness secured hereby given
by the Beneficiary shall operate to release, discharge, modify, change or
affect, in whole or in part, the liability of Grantor hereunder for the payment
of the indebtedness or performance of the obligations secured hereby or the
liability of any other person hereunder for the payment of the indebtedness
secured hereby. Grantor agrees that it shall be bound by any modification of
this Deed of Trust made by the Beneficiary and any subsequent owner of the
Mortgaged Property, with or without notice to Grantor, and no such modifications
shall impair the obligations of Grantor under this Deed of Trust. Nothing in
this section or elsewhere in this Deed of Trust shall be construed to imply the
Beneficiary's consent to any transfer of the Mortgaged Property.
SECTION 6.8. PLACE OF PAYMENT. All Secured Indebtedness which may be owing
hereunder at any time by Grantor shall be payable at the Beneficiary's address
set forth in the preamble hereto.
SECTION 6.9. [INTENTIONALLY OMITTED.]
SECTION 6.10. APPLICATION OF PAYMENTS TO CERTAIN INDEBTEDNESS. If any part
of the Secured Indebtedness cannot be lawfully secured by this Deed of Trust or
if any part of the Mortgaged Property cannot be lawfully subject to the lien and
security interest hereof to the full extent of such indebtedness,
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then all payments made shall be applied on said indebtedness first in discharge
of that portion thereof which is not secured by this Deed of Trust.
SECTION 6.11. [INTENTIONALLY OMITTED.]
SECTION 6.12. SUBSTITUTE TRUSTEE. The Trustee may resign by an instrument
in writing addressed to the Beneficiary, or Trustee may be removed at any time
with or without cause by an instrument in writing executed by the Beneficiary.
In case of the death, resignation, removal, or disqualification of Trustee, or
if for any reason the Beneficiary shall deem it desirable to appoint a
substitute or successor trustee or act instead of the herein named trustee or
any substitute or successor trustee, then the Beneficiary shall have the right
and is hereby authorized and empowered to appoint a successor trustee, or a
substitute trustee, without other formality than appointment and designation in
writing executed by the Beneficiary and the authority hereby conferred shall
extend to the appointment of other successor and substitute trustees
successively until the indebtedness secured hereby has been paid in full, or
until the Mortgaged Property is fully and finally sold hereunder. If the
Beneficiary is a corporation or association and such appointment is executed on
its behalf by an officer of such corporation or association, such appointment
shall be conclusively presumed to be executed with authority and shall be valid
and sufficient without proof of any action by the board of directors or any
superior officer of the corporation or association. Upon the making of any such
appointment and designation, all of the estate and title of Trustee in the
Mortgaged Property shall vest in the named successor or substitute Trustee and
he shall thereupon succeed to, and shall hold, possess and execute, all the
rights, power, privileges, immunities and duties herein conferred upon Trustee.
All references herein to "Trustee" shall be deemed to refer to Trustee
(including any successor or substitute appointed and designated as herein
provided) from time to time acting hereunder.
SECTION 6.13. NO LIABILITY OF TRUSTEE. The Trustee shall not be liable for
any error of judgment or act done by Trustee in good faith, or be otherwise
responsible or accountable under any circumstances whatsoever (INCLUDING
TRUSTEE'S NEGLIGENCE), except for Trustee's gross negligence or willful
misconduct. The Trustee shall have the right to rely on any instrument, document
or signature authorizing or supporting any action taken or proposed to be taken
by him hereunder, believed by him in good faith to be genuine. All monies
received by the Trustee shall, until used or applied as herein provided, be held
in trust for the purposes for which they were received, but need not be
segregated in any manner from any other moneys (except to the extent required by
law), and Trustee shall be under no liability for interest on any moneys
received by him hereunder. Grantor hereby ratifies and confirms any and all acts
which the herein named Trustee or his successor or successors, substitute or
substitutes, in this trust, shall do lawfully by virtue hereof. Grantor will
reimburse Trustee for, and save him harmless against any and all liability and
expenses which may be incurred by him in the performance of his duties. The
foregoing indemnity shall not terminate upon discharge of the Secured
Indebtedness or foreclosure, or release or other termination, of this Deed of
Trust.
SECTION 6.14. RELEASE OF DEED OF TRUST. Upon the earlier of (i) the
satisfaction in full of the Secured Indebtedness and (ii) the repayment of a
portion of the Secured Indebtedness such that the aggregate average amount of
Secured Indebtedness outstanding during a calendar quarter is not in excess of
$1,500,000, then the Beneficiary shall execute appropriate documentation
releasing the lien of this Deed of Trust, and upon the execution of such
release, all rights under this Deed of Trust shall terminate (except to the
extent expressly provided herein with respect to indemnifications,
representations and warranties and other rights which are to continue following
the release hereof) and the Mortgaged Property shall become wholly clear of the
liens, security interests, conveyances and assignments evidenced hereby. Without
limitation, all provisions herein for indemnity of the Beneficiary or Trustee
shall survive discharge of the Secured Indebtedness and any foreclosure, release
or termination of this Deed of Trust.
Page 18
SECTION 6.15. NOTICES. All notices and other communications provided for
herein shall be in writing and shall be delivered by hand or overnight courier
service, mailed by certified or registered mail or sent by facsimile: (a) if to
Grantor, to it at X.X. Xxx 0000, Xxxxxxx, Xxxxx 00000, Attention: Xxxxxxxx X.
Xxxxxx; or (b) if to the Beneficiary, to it at 0000 Xxxxx Xxxx, Xxxxxxx, Xxxxx
00000, Attention: Xxxxxx X. Xxxxxxxxx, facsimile number (000) 000-0000. Any
party hereto may change its address or facsimile number for notices and other
communications hereunder by notice to the other parties hereto. All notices and
other communications given to any party hereto in accordance with the provisions
of this Deed of Trust shall be deemed to have been given on the date of receipt.
SECTION 6.16. INVALIDITY OF CERTAIN PROVISIONS. A determination that any
provision of this Deed of Trust is unenforceable or invalid shall not affect the
enforceability or validity of any other provision and the determination that the
application of any provision of this Deed of Trust to any person or
circumstances is illegal or unenforceable shall not affect the enforceability or
validity of such provision as it may apply to other persons or circumstances.
SECTION 6.17. GENDER; TITLES; CONSTRUCTION. Within this Deed of Trust,
words of any gender shall be held and construed to include any other gender, and
words in the singular number shall be held and construed to include the plural,
unless the context otherwise requires. Titles appearing at the beginning of any
subdivisions hereof are for convenience only, do not constitute any part of such
subdivisions, and shall be disregarded in construing the language contained in
such subdivision. The use of the words "herein," "hereunder" and other similar
compounds of the word "here" shall refer to this entire Deed of Trust and not to
any particular Article, Section, paragraph or provision. The term "person" and
words importing persons as used in this Deed of Trust shall include firms,
associations, partnerships (including limited partnerships), joint ventures,
trusts, corporations and other legal entities, including public or governmental
bodies, agencies or instrumentalities, as well as natural persons.
SECTION 6.18. THE BENEFICIARY'S CONSENT. Except where otherwise expressly
provided herein, in any instance hereunder where the approval, consent or the
exercise of judgment of the Beneficiary is required or requested, (i) the
granting or denial of such approval or consent and the exercise of such judgment
shall be within the sole discretion of the Beneficiary, and the Beneficiary
shall not, for any reason or to any extent, be required to grant such approval
or consent or exercise such judgment in any particular manner, regardless of the
reasonableness of either the request or the Beneficiary's judgment, and (ii) no
approval or consent of the Beneficiary shall be deemed to have been given except
by a specific writing intended for the purpose and executed by an authorized
representative of the Beneficiary.
SECTION 6.19. [INTENTIONALLY OMITTED.]
SECTION 6.20. EXECUTION; RECORDING. This Deed of Trust has been executed
in several counterparts, all of which are identical, and all of which
counterparts together shall constitute one and the same instrument. The date or
dates reflected in the acknowledgments hereto indicate the date or dates of
actual execution of this Deed of Trust, but such execution is as of the date
shown on the first page hereof, and for purposes of identification and reference
the date of this Deed of Trust shall be deemed to be the date reflected on the
first page hereof. Grantor will cause this Deed of Trust and all amendments and
supplements thereto and substitutions therefor and all financing statements and
continuation statements relating thereto to be recorded, filed, re-recorded and
refiled in such manner and in such places as Trustee or the Beneficiary shall
reasonably request.
SECTION 6.21. SUCCESSORS AND ASSIGNS. The terms, provisions, covenants and
conditions hereof shall be binding upon Grantor, and the heirs, devisees,
representatives, successors and assigns of Grantor, and shall inure to the
benefit of Trustee and the Beneficiary and shall constitute covenants
Page 19
running with the land. All references in this Deed of Trust to Grantor shall be
deemed to include all such heirs, devisees, representatives, successors and
assigns of Grantor.
SECTION 6.22. MODIFICATION OR TERMINATION. This Deed of Trust may only be
modified or terminated by a written instrument or instruments intended for that
purpose and executed by the party against which enforcement of the modification
or termination is asserted. Any alleged modification or termination which is not
so documented shall not be effective as to any party.
SECTION 6.23. NO PARTNERSHIP, ETC. The relationship between the
Beneficiary and Grantor is solely that of creditor and debtor. The Beneficiary
has no fiduciary or other special relationship with Grantor. Nothing contained
in this Deed of Trust is intended to create any partnership, joint venture,
association or special relationship between Grantor and the Beneficiary or in
any way make the Beneficiary a co-principal with Grantor with reference to the
Mortgaged Property. All agreed contractual duties between or among the
Beneficiary, Grantor and Trustee relating to the transactions described herein
are set forth herein and any additional implied covenants or duties are hereby
disclaimed. Any inferences to the contrary of any of the foregoing are hereby
expressly negated.
SECTION 6.24. EXPENSES; INDEMNITY; DAMAGE WAIVER. (a) Grantor shall pay
all out-of-pocket expenses incurred by the Beneficiary, including the fees,
charges and disbursements of any counsel for the Beneficiary, in connection with
the enforcement or protection of its rights in connection with this Deed of
Trust, including its rights under this Section.
(b) Grantor shall indemnify the Beneficiary, each affiliate of the
Beneficiary and the respective directors, officers, employees, agents and
advisors of the Beneficiary and the Beneficiary's affiliates (each such person
or entity being called an "Indemnitee") against, and hold each Indemnitee
harmless from, any and all losses, claims, damages, liabilities and related
expenses, including the fees, charges and disbursements of any counsel for any
Indemnitee, incurred by or asserted against any Indemnitee arising out of, in
connection with, or as a result of (i) the execution or delivery of this Deed of
Trust or any agreement or instrument contemplated hereby, the performance by the
parties hereto of their respective obligations hereunder or the consummation of
the transactions contemplated hereby, (ii) any actual or alleged presence or
release of hazardous materials on or from any property owned or operated by
Grantor (including, without limitation, the Mortgaged Property), or any
environmental liability related in any way to Grantor, or (iii) any actual or
prospective claim, litigation, investigation or proceeding relating to any of
the foregoing, whether based on contract, tort or any other theory and
regardless of whether any Indemnitee is a party thereto; provided that such
indemnity shall not, as to any Indemnitee, be available to the extent that such
losses, claims, damages, liabilities or related expenses are determined by a
court of competent jurisdiction by final and nonappealable judgment to have
resulted from the gross negligence or willful misconduct of such Indemnitee.
(c) To the extent permitted by applicable law, the Borrower shall not
assert, and hereby waives, any claim against any Indemnitee, on any theory of
liability, for special, indirect, consequential or punitive damages (as opposed
to direct or actual damages) arising out of, in connection with, or as a result
of, this Deed of Trust or any other agreement or instrument contemplated hereby.
(d) All amounts due under this Section shall be payable promptly after
written demand therefor.
SECTION 6.25. APPLICABLE LAW. THIS DEED OF TRUST SHALL BE GOVERNED AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS AND APPLICABLE
UNITED STATES FEDERAL LAW. If any provision or clause of this Deed of Trust
conflicts with applicable laws, such conflicts shall not affect other provisions
of this Deed of Trust that
Page 20
can be given effect without the conflicting provision, and to this end the
provisions of this Deed of Trust are declared to be severable.
SECTION 6.26. ENTIRE AGREEMENT. This Deed of Trust constitutes the entire
understanding and agreement between Grantor and the Beneficiary with respect to
the transactions contemplated hereby and supersedes all prior written or oral
understandings and agreements between Grantor and the Beneficiary with respect
to the matters addressed herein. Grantor hereby acknowledges that, except as
incorporated in writing herein, there are not, and were not, and no persons are
or were authorized by the Beneficiary to make, any representations,
understandings, stipulations, agreements or promises, oral or written, with
respect to the matters addressed herein.
THIS DEED OF TRUST REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND
MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
[THIS SPACE INTENTIONALLY LEFT BLANK.]
Page 21
IN WITNESS WHEREOF, this instrument is executed by Grantor as of the date
first written on page one hereof, but effective as of June 8, 2004.
SOUTH HAMPTON REFINING CO.
By: /s/ XXXXXXXX X. XXXXXX
--------------------------------------
Name: Xxxxxxxx X. Xxxxxx
Title: President
STATE OF TEXAS )
)
COUNTY OF Jefferson )
This instrument was acknowledged before me on this 8th day of June, 2004,
by Xxxxxxxx X. Xxxxxx, President of South Hampton Refining Co., a Texas
corporation, on behalf of said corporation.
/s/ XXXXX X. XXXX
--------------------------------------------
NOTARY PUBLIC IN AND FOR
THE STATE OF TEXAS
My Commission Expires: 2-14-06
(Signature Page to Deed of Trust)
EXHIBIT "A"
PROPERTY DESCRIPTION
Exhibit A to Deed of Trust
EXHIBIT "B"
PERMITTED ENCUMBRANCES
All outstanding encumbrances of record.
Exhibit B to Deed of Trust
