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EXHIBIT 10.66
______STATE OF INDIANA ___________________________ SPACE ABOVE THIS LINE FOR
RECORDING DATA
SUBORDINATION AGREEMENT
(MORTGAGES TO MORTGAGE)
NOTICE: THIS SUBORDINATION AGREEMENT RESULTS IN YOUR SECURITY
INTEREST IN THE PROPERTY BECOMING SUBJECT TO AND OF
LOWER PRIORITY THAN THE LIEN OF PRIMARY
LENDER'S MORTGAGE (DEFINED BELOW)
This SUBORDINATION AGREEMENT (the "Agreement") is made as of March 29, 2000 by
and among HOUBA, an Indiana corporation, the owner of the real property
hereinafter described ("Owner"), XXXXX PARTNERS, III, L.P., a Delaware limited
partnership ("Xxxxx") and ORACLE STRATEGIC PARTNERS, L.P., a Delaware limited
partnership ("Oracle") holders of the mortgages described below (collectively,
"Subordinate Lenders"), in favor of XXXXXX PHARMACEUTICALS, INC., a Nevada
corporation ("Primary Lender").
R E C I T A L S
A. Owner has executed, or proposes to execute, a Real Estate Mortgage
(With Future Advance Clause) ("Primary Lender's Mortgage") securing,
among other things, repayment of a promissory note ("Note") in the
principal amount of Seventeen Million Five Hundred Thousand Dollars
($17,500,000), dated as of March 29, 2000 in favor of Primary Lender
(the "Primary Loan"), pursuant to which Owner grants to Primary
Lender a security interest in and to the property described on
Exhibit A attached hereto and made a part hereof (which property,
together with all improvements now or hereafter located on the
property, is hereinafter referred to as the "Property"). Primary
Lender's Mortgage is to be recorded prior to this Agreement.
B. Pursuant to the terms and provisions of (i) that certain mortgage
dated March 10, 1998 and recorded April 14, 1998 as Mortgage Record
9803137 in the official records of Xxxxxxxx County, Indiana (the
"Official Records") securing repayment of a promissory note in the
principal amount of Twenty Million Eight Hundred Thousand Dollars
($20,800,000) executed by Owner in favor of Xxxxx and (ii) that
certain mortgage dated May 26, 1999 and recorded June 28, 1999 as
Mortgage Record 9905386 in the Official Records in the principal
amount of Twenty-Two Million Eight Hundred Sixty-Three Thousand
Dollars ($22,863,000) executed by Owner in favor of Oracle, Owner
granted to Subordinate Lenders a security interest in and to the
Property.
C. As a condition of the Primary Lender making the Primary Loan secured
by Primary Lender's Mortgage, Primary Lender requires that Primary
Lender's Mortgage be unconditionally and at all times remain a lien
or charge upon the Property, prior and superior to all the rights of
Subordinate Lenders under their mortgages with respect to the
Primary Loan outstanding at any time, accrued and unpaid interest
thereon and reasonable costs and expenses of enforcement by Xxxxxx
of its rights and collection with respect to the Primary Loan (the
"Senior Debt"), and that the Subordinate Lenders specifically and
unconditionally subordinate their mortgages to the lien or charge of
Primary Lender's Mortgage with respect to the Senior Debt.
D. The Subordinate Lenders and Owner agree to the foregoing
subordination in favor of Primary Lender.
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NOW, THEREFORE, for valuable consideration and to induce Primary Lender to make
the Primary Loan, Owner and the Subordinate Lenders hereby agree for the benefit
of Primary Lender as follows:
4.1 The foregoing recitals are incorporated herein by this
reference. Primary Lender's Mortgage, the Note in favor
of Primary Lender, and shall unconditionally be and at
all times remain a lien or charge on the Property to the
extent they secure the Senior Debt prior and superior to
the mortgages of the Subordinate Lenders; and
4.2 This Agreement shall be the whole agreement with regard
to the subordination of the mortgages of the Subordinate
Lenders to the lien or charge of Primary Lender's
Mortgage, and shall supersede and cancel, but only
insofar as would affect the priority of Primary Lender's
Mortgage to the extent securing the Senior Debt, any
prior agreements as to such subordination, including,
without limitation, those provisions, if any, contained
in the mortgages of the Subordinate Lenders which
provide for the subordination of the mortgage of any
later or subsequent lender to a deed or to a mortgage or
mortgages.
Subordinate Lenders further declare, agree and acknowledge for the benefit of
Primary Lender, that:
4.3 Primary Lender, in making disbursements pursuant to any
such agreement, is under no obligation or duty to, nor
has Primary Lender represented that it will, see to the
application of such proceeds by the person or persons to
whom Primary Lender disburses such proceeds, and any
application or use of such proceeds for purposes other
than those provided for in such agreement or agreements
shall not defeat the subordination herein made in whole
or in part; and
4.4 Subordinate Lenders intentionally and unconditionally
subordinate all of Subordinate Lenders' rights, title
and interest in and to the Property to the lien or
charge of Primary Lender's Mortgage to the extent
securing the Senior Debt upon the Property and
understand that in reliance upon, and in consideration
of, this subordination, specific loans and advances are
being and will be made by Primary Lender and, as part
and parcel thereof, specific monetary and other
obligations are being and will be entered into which
would not be made or entered into but for the reliance
upon this subordination.
5. This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original and all of which together shall
constitute and be construed as one and the same instrument.
NOTICE: THIS SUBORDINATION AGREEMENT CONTAINS A PROVISION WHICH
MAY ALLOW THE PERSON OBLIGATED ON YOUR REAL PROPERTY
SECURITY TO OBTAIN A LOAN, A PORTION OF WHICH MAY BE
EXPENDED FOR PURPOSES OTHER THAN IMPROVEMENT OF THE
PROPERTY.
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IT IS RECOMMENDED THAT, PRIOR TO THE EXECUTION OF THIS AGREEMENT, THE PARTIES
CONSULT WITH THEIR ATTORNEYS WITH RESPECT THERETO.
"Owner"
HOUBA, INC.,
an Indiana corporation
By: /s/ Xxxxxxx Xxxxxxx
Name:
Chief Executive Officer
"Subordinate Lenders"
ORACLE STRATEGIC PARTNERS, L.P.,
a Delaware limited partnership
By: Oracle Strategic Capital. L.L.C.,
General Partner
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Name: /s/ Xxxxx Xxxxxxxx
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Title: Managing Member
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XXXXX PARTNERS III, L.P.
a Delaware limited partnership
By: Claudius, L.L.C.,
General Partner
000 Xxxxx Xxxxxx, Xxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Name: /s/ Xxxxx X. Xxxxxx
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Title: Senior Managing Member
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(ALL SIGNATURES MUST BE ACKNOWLEDGED)
