Exhibit 10(SS)
STATE OF SOUTH CAROLINA
MORTGAGE, SECURITY AGREEMENT,
COUNTY OF XXXXXXXX AND FINANCING STATEMENT
This MORTGAGE, SECURITY AGREEMENT AND FINANCING STATEMENT (the
"Mortgage") is made and entered into as of March 20, 1998, by StarMet CMI
Corporation, its successors and assigns (the "Mortgagor") in favor of LOWER
SAVANNAH REGIONAL DEVELOPMENT CORPORATION, having as an address X.X. Xxx 000,
Xxxxx, XX 00000, its successors and assigns (the "Mortgagee").
WITNESSETH:
WHEREAS, Mortgagor is indebted to Mortgagee pursuant to a
promissory note of even date herewith in the original principal amount of
Five Hundred Thousand and 00/100 DOLLARS ($500,000.00) (together with any and
all extensions, renewals, or modifications thereof, the "Note"); and
WHEREAS, Mortgagor desires to secure its obligations under the Note
by granting the Mortgagee a first mortgage lien on and security interest in
the real property, improvements, fixtures, and personal property described
below;
NOW, THEREFORE, the Mortgagor in consideration of the aforesaid
debt, and also in consideration of the further sum of Three and No/100
($3.00) Dollars, to it in hand paid by the Mortgagee, receipt whereof which
is hereby acknowledged, and for the purpose of securing the Obligations (as
hereinafter defined), has granted, bargained, sold, and released, and by
these presents, does grant, bargain, sell and release unto the Mortgagee, its
successors and assigns, as security for the Obligations (as defined below),
the land described on Exhibit A attached hereto and incorporated by reference
(the "Land") including all improvements (the "Improvements") now existing or
hereafter placed on the Land;
TOGETHER, with all rights, privileges, interests, easements, tenements,
hereditaments and appurtenances thereto belonging, including without
limitation all right, title and interest of Mortgagor in and to water,
minerals, flowers, shrubs, crops, trees, timber and other emblements now or
hereafter located therein, and the rents, issues and profits thereof, and any
and all improvements and fixtures now or subsequently attached to or used in
connection therewith (collectively, together with the Land, the Improvements,
and the Additional Property (as hereafter defined), the "Mortgaged Property").
TO HAVE AND TO HOLD, all and singular the Mortgaged Property, unto the
Mortgagee, its successors and assigns forever.
AND the Mortgagor covenants with the Mortgagee that the Mortgagor is
indefeasibly seized of a good and marketable fee simple title to said Land
and has good and lawful authority
to mortgage said Land; that the Mortgagor hereby fully warrants the title to
said Land and willdefend the same against the lawful claims of all persons
whomsoever; and that said Land is free and clear of all encumbrances except
those exceptions set forth on Exhibit B attached hereto and incorporated by
reference.
PROVIDED, ALWAYS, that if the Mortgagor shall pay unto the Mortgagee the
said Obligations (including any future advances); AND if the Mortgagor shall
duly, promptly and fully perform, discharge , execute, effect, complete and
comply with and abide by each and every of the stipulations, Agreements,
conditions and covenants therein and in this Mortgage, then this Mortgage and
all assignments contained herein shall cease and be null and void; otherwise
to remain in full force and effect.
THIS MORTGAGE secures (a) the obligations of Mortgagor to Mortgagee
under the Note; (b) any and all advances or expenditures made by Mortgagee
pursuant to the terms of this Mortgage; (c) attorneys' fees, court costs, and
other amounts which may be due under the Note, or this Mortgage; (d) any and
all other indebtedness of Mortgagor to Mortgagee, now existing or hereafter
arising, of whatever class or nature, whether or not now contemplated by the
parties, including future advances pursuant to S.C. Code Xxx. Section 29-3-50
(as set forth more fully below); and (e) any and all extensions, renewals,
and modifications of any of the foregoing (all of (a) through (e) being
hereinafter referred to the as "Obligations"). Extensions, renewals, and
modifications of the debt secured hereby, and future advances, may bear
interest at a rate or rates higher than the rate borne by the Note.
THIS MORTGAGE shall secure not only existing indebtedness but all future
advances (in accordance with S.C. Code Xxx. Section 29-3-50, as amended),
readvances, and additional indebtedness hereafter arising or incurred of
Mortgagor to Mortgagee, and any notes evidencing the same, whether such
advances or indebtedness is obligatory or to be made at the option of the
Mortgagee, or otherwise, to the same extent as if such future advance or
indebtedness was made on the date of the execution of this Mortgage, but the
indebtedness secured by this Mortgage shall not exceed at any one time the
maximum principal amount of Five Hundred Thousand and 00/100 Dollars ($ 500,
000. 00 ), plus interest thereon, reasonable attorneys' fees and court costs,
and plus advancements for taxes, insurance premiums, and repairs made by
Mortgagee. All indebtedness incurred after the date hereof by Mortgagor in
favor of Mortgagee shall be deemed to be a future advance and entitled to the
protection of this provision. Such future indebtedness may bear interest at a
rate or rates greater than the rate set forth in the Note. Interest on the
Note will be deferred, accrued, or capitalized, but Mortgagee shall not be
required to defer, accrue, or capitalize any interest except as provided in
the Note.
AS FURTHER SECURITY for the Obligations, Mortgagor hereby grants to
Mortgagee, its successors and assigns, a continuing security interest in the
following (the "Additional Property"):
(a) All machinery, apparatus, equipment, fittings, fixtures, and
other personal property (all as defined in the Uniform Commercial Code)
actually or constructively
2
attached to the Land or the Improvements and now owned or hereafter
acquired by the Mortgagor, including, but without limiting the generality
of the foregoing, all heating, air conditioning, freezing, lighting, pipes;
pumps; tanks; motors; conduits; plumbing, lifting, cleaning, fire prevention,
fire extinguishing, refrigerating, ventilating and communications apparatus,
boilers, furnaces, oil burners or units thereof, ducts and compressors,
together with all building materials and equipment now or hereafter delivered
to the Land or the Improvements and intended to be installed therein;
(b) All of the water, sanitary and storm sewer systems now or
hereafter owned by the Mortgagor which are now or hereafter located by,
over, and/or upon the Land or the Improvements or any part and parcel
thereof, and which water system includes all water mains, service
laterals, hydrants, valves and appurtenances, and which sewer system
includes all sanitary sewer lines, including mains, laterals, manholes and
appurtenances;
(c) All exterior lights, light poles, and related fixtures and
equipment, including without limitation all parking lot lighting;
(d) All paving for streets, roads, walkways or entrance ways now or
hereafter owned by the Mortgagor and which are now or hereafter located on
the Land or the Improvements or any part or parcel thereof;
(e) Any and all awards or payments, including interest thereon, and
the right to receive the same, as a result of (a) the exercise of the right
of eminent domain, (b) the alteration of the grade of any street, or (c)
any other injury to, taking of, or decrease in the value of the Land or the
Improvements or personal property;
(f) All of the Mortgagor's interest in all utility security deposits
or bonds on the Land or the Improvements or any part or parcel thereof;
(g) All licenses (including, but not limited to, any operating
licenses), contracts, management contracts or agreements, franchise
agreements, permits, authorities or certificates required or used in
connection with the ownership of, or the operation or maintenance of the
Improvements;
(h) All names under or by which the Land or the Improvements may at
any time be operated or known, and all rights to carry on business under
any such names or any variant thereof, and all trademarks, trade names,
patents pending and goodwill;
(i) All utility service bonds and/or cash deposits, site improvement
bonds and/or cash deposits, building permits, sewer connection and/or
tap-in permits, water connection and/or tap-in permits, curb-cut permits,
utility service agreements, site work agreements with any governmental
authority or public utility, and all other permits, approvals and contracts
of any kind relating to the Land or Improvements;
3
j) All warranties and guaranties covering any appliances and
fixtures now or hereafter located on or placed upon the Land or used in
connection with the Improvements including without limitation, air
conditioning, heating and other appliances and equipment;
(k) All surveys, agreements, instruments, contracts, documents of
title, choses in action or intangible property or contract rights of any
kind now existing or hereafter arising or created or entered into related
to the Land or the Improvements or ownership or operation of the Land or
Improvements including, but not limited to, the plans and specifications,
all construction, architectural and other contracts, purchase orders,
permits, approvals, licenses, franchises, trademarks, project logos,
building names, surveys, insurance policies, bonds, escrow funds, easement,
exclusive agency licenses or leases and proceeds of any of the foregoing;
(1) All sales agreements, deposit receipts, escrow agreements and
other ancillary documents and agreements entered into with respect to the
sale to any purchasers of any part of the Land or any buildings or
structures on the Land, together with all deposits and other proceeds of
the sale thereof;
(m) All rents, issues, profits, and revenues from the Mortgaged
Property;
(n) All substitutions and replacements of, and accessions and
additions to, any of the foregoing; and
(o) All proceeds of any of the foregoing, including, without
limitation, proceeds of any voluntary or involuntary disposition or claim
respecting any part thereof (pursuant to judgment, condemnation award or
otherwise) and all goods, documents, general intangibles, chattel paper and
accounts, wherever located, acquired with cash proceeds of any of the
foregoing or proceeds thereof.
AND the Mortgagor does hereby expressly covenant and agree as follows:
1. Assignment of Rents and Profits. As further security for the
payment of the Obligations and for the faithful performance of all the
covenants, agreements, terms and provisions of this Mortgage, Mortgagor
hereby sells, mortgages, transfers and assigns unto Mortgagee and grants
Mortgagee a security interest in all the right, title and interest of the
Mortgagor in and to the rents, issues, profits, revenues, royalties, rights
and benefits from the above described property, and to that end Mortgagor
hereby assigns and sets over unto the said Mortgagee all leases and licenses
of said premises now made, executed or delivered, whether written or verbal,
or to be hereafter made, be the same written or verbal, and Mortgagor does
hereby authorize and empower the Mortgagee to collect said rents, issues,
profits, revenues, royalties, rights and benefits, as they shall become due,
and does hereby direct each and all of the tenants of the aforesaid premises
to pay such rents, as they may now be due or shall hereafter become due to
the said Mortgagee, upon demand for payment thereof by said Mortgagee; it
being
4
understood and agreed, however, that no such demand shall be made unless and
until there has occurred an Event of Default hereunder; and until such demand
is made, Mortgagor is authorized to collect or continue collecting said
rents, issues, profits, revenues, royalties, rights and benefits; but that
such privilege to collect or continue collecting, as aforesaid, by the
Mortgagor shall not operate to permit the collection of any rents more than
thirty (30) days in advance of the date same are due under the terms and
provisions of said lease or leases.
2. After Acquired Property. The Lien of this Mortgage shall
automatically attach, without further act, to all after acquired property
located in or on, or attached to, or used or intended to be used in
connection with or with the operation of the Mortgaged Property or any part
thereof, and shall likewise automatically attach to any and all subsequent or
additional interests Mortgagor may hereafter acquire in the Mortgaged
Property.
3. Payment of Obligations. Mortgagor covenants and agrees to pay the
Obligations in accordance with their terms promptly as the principal and
interest thereon shall become due.
4. Maintenance of Property. Mortgagor shall maintain the Mortgaged
Property in good condition and repair and shall neither permit nor allow
waste thereof. Mortgagor shall promptly repair or restore any portion of the
Mortgaged Property which is damaged or destroyed by any cause whatsoever and
shall promptly pay when due all costs and expenses of such repair or
restoration. Mortgagor shall not remove, demolish, or materially alter any
improvement or fixture which is now or hereafter part of the Mortgaged
Property and shall cut no timber on the on the Mortgaged Property without the
express written consent of Mortgagee. Mortgagee shall be entitled to
specific performance of the provisions of this paragraph.
5 . Insurance. Mortgagor shall maintain with respect to all
buildings,improvements,fixtures, and tangible personal property which are now
or hereafter part of the Mortgaged Property, fire and extended coverage
insurance, including windstorm and hail,and earthquake insurance, and such
other hazard insurance as Lender may require. If any portion of the
Mortgaged Property is located in a federally designated flood plain,
Mortgagor shall also obtain a flood insurance policy in the maximum amount
available under the National Flood Insurance Act of 1968, but not to exceed
the replacement value of all buildings and improvements located on the
Mortgaged Property that are located in a federally designated flood plain.
All such insurance shall be payable to Mortgagee as the interest of Mortgagee
may appear pursuant to the New York standard form of mortgagee clause or such
other form of mortgagee clause as may be required by the Mortgagee and shall
not be cancelable by either the insurer or the insured without at least
thirty (30) days prior written notice to the Mortgagee. Mortgagor shall keep
the Mortgaged Property continuously insured as herein required and shall
deliver to Mortgagee a copy of each policy of insurance required hereby
together with a current certificate of insurance. Mortgagor shall pay each
premium coming due on any such policy of insurance and will deliver to
Mortgagee proof of such payment at least ten (10) days prior to the date such
premium would become overdue or delinquent. Upon the expiration or
termination of any such policy of insurance, Mortgagor shall furnish to
Mortgagee at least ten (10) days prior to such
5
expiration or termination a copy of a renewal or replacement policy of
insurance meeting the requirements hereof together with a current certificate
of insurance. If Mortgagor fails to insure the Mortgaged Property as herein
required, Mortgagee may so insure the Mortgaged Property in the name of
Mortgagor or in the name of Mortgagee or both, and the premiums for any such
insurance obtained by Mortgagee shall be the obligation of Mortgagor and
shall secured by this Mortgage. Upon foreclosure of this Mortgage, all
right, title and interest of Mortgagor in and to any policy of insurance upon
the Mortgaged Property which is in the custody of Mortgagee, including the
right to unearned premiums, shall vest in the purchaser of the Mortgaged
Property at foreclosure, and Mortgagor hereby appoints Mortgagee as the
attorney in fact of Mortgagor to assign all right, title and interest of
Mortgagor in and to any such policy of insurance to such purchaser. This
appointment is coupled with an interest and shall be irrevocable.
6. Proceeds of Insurance. Mortgagor hereby assigns to Mortgagee the
right to collect and receive any indemnity payment otherwise owed Mortgagor
upon any policy of insurance insuring any portion of the Mortgaged Property,
regardless of whether Mortgagee is named in such policy as a person entitled
to collect upon the same. So long as there has occurred no Event of Default
hereunder, or any event which but for the lapse of time or the giving of
notice would constitute an Event of Default, any indemnity payment received
by Mortgagee from any such policy of insurance shall be applied in a manner
reasonably determined by Mortgagee to the replacement, repair or restoration
of the portion of the Mortgaged Property damaged or destroyed.
Notwithstanding the foregoing, if at the time of payment of the insurance
proceeds there has occurred an Event of Default which has not been cured or
remedied as permitted hereunder, or if in the reasonable determination of
Mortgagee the insurance proceeds, together with funds made available by
Mortgagor for such purpose, are insufficient to replace, repair, or restore
the Mortgaged Property, then Mortgagor may apply such proceeds to payment of
any sum secured by this Mortgage in such order as Mortgagee may determine. No
portion of any indemnity payment which is applied to replacement, repair or
restoration of any portion of the Mortgaged Property or which may be released
to Mortgagor shall be deemed a payment against any sums secured by this
Mortgage.
7. Taxes. Mortgagor shall pay all taxes, assessments and other
charges which constitute or are secured by a lien upon the Mortgaged Property
which is superior to the lien of this Mortgage and shall deliver to Mortgagee
proof of payment of the same not less than ten (10) days prior to the date
the same becomes delinquent; provided, however, that Mortgagor shall be
entitled by appropriate proceedings to contest the amount of validity of such
tax, assessment or charge so long as the collection of the same by
foreclosure of the lien upon the Mortgaged Property is stayed during the
pendency of such proceedings and Mortgagor deposits with the authority to
which such tax, assessment or charge is payable or with the Mortgagee
appropriate security for payment of the same, together with any applicable
interest and penalties, should the same be determined due and owing.
Mortgagor shall not claim, demand or be entitled to receive any credit or
credits on the principal or interest payable under the terms of the Note or
on any other Obligations secured hereby, for so much of the taxes,
assessments or similar impositions assessed against the Mortgaged Property or
any part thereof as are applicable to the indebtedness secured hereby or to
Mortgagee's interest in the Mortgaged Property. No deduction shall be
6
claimed from the taxable value of the Mortgaged Property or any part thereof
by reason of the Note, this Mortgage or any other instrument securing the
Note.
8. Advances by Mortgagee; Reimbursement. If Mortgagor fails to make
payment for restoration or repair of the Mortgaged Property, for insurance
premiums or for taxes, assessments or other charges as required in this
Mortgage, Mortgagee may, but shall not be obligated to, pay for the same, and
any such payment by Mortgagee will be secured by this Mortgage and have the
same rank and priority as the principal debt secured hereby and bear interest
from the date of payment at the rate provided in the Note. Payments made for
taxes by Mortgagee shall be a first lien on the Mortgaged Property to the
extent of the taxes so paid with interest from the date of payment,
regardless of rank or priority of this Mortgage. Mortgagor shall pay to
Mortgagee in cash on demand an amount equal to any payment made by Mortgagee
pursuant to this paragraph plus interest thereon as herein provided.
9. Extending Time for Payment. Mortgagee, without notice, and as often
as it wishes to, may agree with any party obligated on the Obligations (or
any of them), or having an interest in the Mortgaged Property, to renew or
extend the time for payment of any part or all of the indebtedness secured
hereby, without in any way affecting either the lien hereof or the liability
of any other party.
10. Events of Default. The term "Event of Default, " wherever used in
this Mortgage, shall mean any one or more of the following events:
(a) The occurrence of a default under and as defined in the Note,
the giving of any required notice, and the continuation of such default
unremedied beyond anapplicable grace period set forth in the Note.
(b) The occurrence of an Event of Default under and as defined in
that certain construction and term loan agreement of even date herewith
between Mortgagor and Mortgagee, the giving of any required notice, and
the continuation of such default unremedied beyond any applicable grace
period set forth in such construction loan agreement.
(c) Failure by the Mortgagor to pay within ten (10) days of the
scheduled payment date any installment of principal and/or interest on the
Obligations or any of them, including but not limited to the Note, or
failure to pay taxes or insurance when due, and the continuation of any
such failure for ten (10) days after written notice thereof is provided
thereof by Mortgagor to Mortgagee.
(d) The sale, conveyance, transfer, mortgage, lease or encumbrance
of all or any portion of the Mortgaged Property.
(e) Failure by the Mortgagor to duly observe any other covenant,
condition or agreement of the Obligations, or of this Mortgage, and the
continuation of such failure
7
for a period of thirty (30) days after written notice thereof is provided
by Mortgagee to Mortgagor.
(f) Default in the terms or conditions of any other mortgage which
is a lien upon the Mortgaged Property, and the continuation of such
default beyond any applicable grace period.
(g) The discovery of any material amount of Hazardous Substance (as
hereinafter defined) on the Mortgaged Property, which Mortgagee reasonably
determines has a material, adverse effect on the value of the Mortgaged
Property; provided, however, that the foregoing shall not be deemed to
include petroleum products and related substances properly stored and used
in the ordinary course of business operations on the Mortgaged Property,
and shall further not be deemed to include minor spills of petroleum and
related products having no material, adverse impact on the value of the
Mortgaged Property.
(h) The damage or destruction of a material portion of the
Improvements, which damage or destruction is not promptly repaired or is
not fully covered by insurance.
(i) Mortgagor suffers or permits any lien, encumbrance, or security
interest to arise or attach to the Mortgaged Property that is not promptly
removed or satisfied, or any judgment is entered against Mortgagor that is
not satisfied or appealed and stayed within thirty days.
(j) Any lien for labor, material, taxes or otherwise shall be filed
against the Mortgaged Property or any part thereof, which lien or liens
shall not be discharged or released within thirty (30) days after the
filing of such lien, whether by payment in satisfaction of such lien or
securing such lien by surety bond.
11. Consequences of Default. If an Event of Default shall occur:
(a) All of the indebtedness secured hereby shall become and be
immediately due and payable at the option of the Mortgagee, without notice
or demand, which are hereby expressly waived, and the Mortgagee may proceed
to foreclose this Mortgage and sell the Mortgaged Property or otherwise
pursue any right or remedy herein or by law provided. At the foreclosure,
Mortgagee shall be entitled to bid and purchase the Mortgaged Property and
shall be entitled to apply the debt secured hereby, or any portion thereof,
in payment for the Mortgaged Property.
(b) Irrespective of whether Mortgagee accelerates the maturity of
all indebtedness secured hereby, or institutes foreclosure proceedings,
Mortgagee shall be entitled to the appointment of a receiver to enter
upon and take and maintain full control of the Mortgaged Property in
order to perform all acts necessary and appropriate for the operation
and maintenance thereof including, but not limited to, the execution,
8
cancellation or modification of leases, the making of repairs to the
Mortgaged Property and the execution or termination of contracts providing
for the management or maintenance of the Mortgaged Property, all on such
terms as are deemed appropriate to protect the security of this Mortgage.
The receiver shall be entitled to a reasonable fee for so managing the
Mortgaged Property. All rents collected pursuant to this paragraph shall
be applied first to the costs of taking control and managing the Mortgaged
Property and collecting the rents, including but not limited to
reasonable attorneys' fees, receiver's fees, premiums on receiver's
bonds, costs of repair to the Mortgaged Property, premiums on insurance
policies, taxes, assessments and other charges on the Mortgaged
Property, and the costs of discharging any liability or obligation of
Mortgagor as lessor or Landlord of the Mortgaged Property and then to
the sums secured by this Mortgage. Mortgagee and the receiver shall have
access to the books and records used in the operation and maintenance of
the Mortgaged Property and shall be liable to account only for those
rents actually received. Mortgagee shall not be liable to Mortgagor,
anyone claiming, under or through Mortgagor, or anyone having an
interest in the Mortgaged Property by reason of anything done or left
undone by Mortgagee under this paragraph. If the rents of the Mortgaged
Property are not sufficient to meet the costs of taking control of and
managing the Mortgaged Property and collecting the rents, Mortgagee may
at its sole option advance funds to meet the costs. Any funds expended
by Mortgagee for such purposes shall become indebtedness of Mortgagor to
Mortgagee secured by this Mortgage. Such funds shall be payable on demand
by Mortgagee and shall bear interest at the rate provided in the Note. The
entering upon and taking and maintaining of control of the Mortgaged
Property by the Mortgagee or the receiver and the application of the rents
as provided herein shall not cure or waive any default hereunder or
invalidate any other right or remedy of Mortgagee hereunder.
(c) The Mortgagee shall, in addition to all other rights and
remedies, have the rights and remedies of a secured party under the
Uniform Commercial Code, including without limitation, the right to take
possession of the Additional Property, and for that purpose the
Mortgagee may: (i) so far as the Mortgagor can give authority therefor,
enter upon any premises on which the Additional Property may be situated
and remove the same therefrom; (ii) take possession or control of the
Additional Property and the premises on which it is located; (iii)
require the Mortgagor to assemble all or any part of the Additional
Property or records concerning the Additional Property and make such
available to the Mortgagee at a place to be designated by the Mortgagee
which is reasonably convenient to both parties; (iv) sell or otherwise
dispose of all or any part of the inventory on any premises where then
located without being liable to the Mortgagor on account of any loss,
damage or depreciation that may occur as a result thereof so long as the
Mortgagee shall act in a commercially reasonable manner; (v) use all
trademarks, service marks, trade names, trade styles, logos, goodwill,
trade secrets, franchises, licenses and patents which the Mortgagor now
has or may hereafter acquire, including the right to use or license the
use of said marks, names, styles, logos and goodwill in connection with
the sale of goods or the rendering of services, in the conduct of service,
advertising, promotion and the like; and (vi) lease or license third
persons or entities for such purpose.
9
Unless the Additional Property is perishable or threatens to decline
speedily in value or is of a type customarily sold on a recognized market,
the Mortgagee shall give to the Mortgagor at least thirty (30) days' prior
written notice (which Mortgagor agree is "reasonable notification" within
the meaning of Section 9-504 of the Uniform Commercial Code of the State of
South Carolina) of the time and place of any public sale or any other
intended disposition of the Additional Property is to be made.
12. Marshalling of Assets. The Mortgagee shall not be required to
marshal any present or future security for (including but not limited to this
Mortgage and the Mortgaged Property), or guaranties of, the Obligations or
any of them, or to resort to such security or guaranties in any particular
order; and all of the rights hereunder and in respect of such security and
guaranties shall be cumulative and in addition to all other rights, however
existing or arising. To the extent that it lawfully may, the Mortgagor
hereby agrees that it will not invoke any law relating to the marshalling of
collateral which might cause delay in or impede the enforcement of the
Mortgagee's rights under this Mortgage or under any other instrument
evidencing any of the Obligations or under which any of the Obligations is
secured or guaranteed, and to the extent that it lawfully may the Mortgagor
hereby irrevocably waives the benefits of all such laws.
13. Costs and Expenses. All reasonable costs and expenses (including
attorneys' fees) incurred or paid by the Mortgagee in connection with
enforcement of the Obligations or the exercise by the Mortgagee of any of its
rights or remedies hereunder, or in retaking, holding, preparing for sale and
selling or otherwise realizing upon any of the Mortgaged Property, including,
without limitation, the reasonable attorneys' fees and expenses of any
attorney to whom this matter is referred (whether or not litigation is
commenced), or for representation in proceedings under any bankruptcy or
insolvency law, or in case the Mortgagee has become a party either as
plaintiff or as defendant in any suit or legal proceedings, in relation to
the Mortgaged Property or the lien created herein, shall be repaid by the
Mortgagor to the Mortgagee upon demand, with interest at the rate provided in
the Note. In the event said expenses are not paid by the Mortgagor to the
Mortgagee, they shall become part of the Obligations and shall be secured
hereby.
14. Interest. It is agreed that nothing herein contained nor any
transaction related thereto shall be construed or so operate as to require
the Mortgagor to pay interest at a rate greater than is now lawful in such
case to contract for, or to make any payment or to do any act contrary to
laws, that if any clauses or provisions herein contained operate or would
prospectively operate to invalidate this Mortgage or the Note in whole or in
part, then such clauses and provisions only shall be held for naught, as
though not herein contained, and the remainder of this Mortgage shall remain
operative and in full force and effect.
15. Eminent Domain. The Mortgagee shall be entitled to receive and
recover the entire award made in any eminent domain proceedings to the extent
that the same does not exceed the amount necessary to pay in full all sums
secured by the lien of this Mortgage.
10
16. Transfer of Property. Mortgagor shall not sell, convey, transfer,
mortgage, lease or further encumber, nor suffer or permit the sale,
conveyance, transfer, mortgage, lease or encumbrance, whether voluntarily or
by operation of law, of any interest in or any part of the Mort-aged
Property, the rents and profits therefrom, or the Additional Property,
without the prior written consent of Mortgagee. If any person or entity
should obtain any interest in all or any part of the Mortgaged Property
pursuant to the execution or enforcement of any lien, security interest or
other right, whether superior, equal. or subordinate to this Mortgage or the
lien hereof, such event shall unless otherwise provided herein be deemed to
be a transfer by Mortgagor. Mortgagor shall not, without the prior written
consent of the Mortgagee, further assign the rents from the Mortgaged
Property nor enter into any agreement or do any act to amend, modify, extend,
terminate or cancel, accept the surrender, subordinate, accelerate the
payment of rent, or change the terms of any renewal option of any lease now
or hereafter covering such property or any part thereof which would in each
instance or in the aggregate materially affect the collateral or the
operation of the Mortgagor or the Mortgaged Property or the ability of the
Mortgagor to repay the Note.
17. Further Assurances. The Mortgagor shall, at its sole expense, do,
make, execute and deliver all such additional and further acts, things,
deeds, assurances and instruments, in each case in form and substance,
satisfactory to the Mortgagee, relating to the creation, validity, or
perfection of the mortgage lien and security interests provided for in this
Agreement under the Uniform Commercial Code or other laws of the State of
South Carolina or of any other state or states in which Mortgagor is doing
business or in which any of the Mortgaged Property is located as the
Mortgagee may from time to time reasonably request, and shall take all such
other action as the Mortgagee may reasonably require more completely to vest
in any and assure to the Mortgagee its rights hereunder or in any of the
Mortgaged Property, including without limitation execution and delivery of
financing statements which the Mortgagee deems appropriate to perfect and
continue the security interest hereby granted; and the Mortgagor hereby
irrevocably authorizes the Mortgagee, or its designee, at the Mortgagor's
sole expense, to execute and file such financing statements, with or without
the Mortgagor's signature, as the Mortgagee may deem appropriate. In the
event that any recording or refiling (or the filing of any statement of
continuation of any mortgage lien or financing statement) or any repledge, or
any other action, is required at any time to protect and preserve such
security interests, the Mortgagor shall, at its sole expense, cause the same
to be done or taken at such time and in such manner as may be necessary and
as may be reasonably requested by the Mortgagee.
18. Inspections; Easement. Mortgagor hereby agrees that Mortgagee
shall have the right, at any time during the term of this Mortgage, to
conduct an environmental investigation of the Mortgaged Property, either
itself or by or through designated agents and may exercise such rights from
time to time, and in furtherance of such rights, Mortgagor hereby grants to
Mortgagee, its successors and assigns, a non-exclusive limited easement over
and across the Mortgaged Property, and its subsurface, for access to the
Mortgaged Property and for the purpose of conducting an environmental
investigation of such Mortgaged Property, provided that any such
investigation shall be conducted in such a manner as to not disrupt the
Mortgagor's operations on the Mortgaged Property. The satisfaction of, or
the release of a portion of the Mortgaged
11
Property, shall evidence a termination of the easement granted herein in
full, or as to the Mortgaged Property released, as the case may be. This
easement is irrevocable so long as this Mortgage is outstanding.
19. Environmental Covenants. The Mortgagor hereby covenants and agrees
with Mortgagee as follows:
(a) Mortgagor will not use, generate, manufacture, produce, store,
release, discharge, or dispose of on, under or about the Mortgaged Property
or transport to or from the Mortgaged Property any material amount of any
Hazardous Substance (as defined herein) or allow any other person or entity
to do so, and shall keep and maintain the Mortgaged Property in compliance
with, and shall not cause or permit the Mortgaged Property to be in violation
of any Environmental Law (as defined herein). Notwithstanding the foregoing,
Mortgagor and its tenants may use and store petroleum and related products in
the ordinary course of business operations on the Mortgaged Property,
provided that such use and storage is in substantial compliance with
applicable laws and regulations.
(b) Mortgagor shall give prompt written notice to Mortgagee of: i) any
material proceeding or inquiry by any governmental authority with respect to
the presence of any Hazardous Substance (other than petroleum and related
products properly stored and used in the ordinary course of business) on the
Mortgaged Property, an adverse determination of which could have a material
adverse affect on the value of the Mortgaged Property; ii) all material
claims made or threatened by any third party against Mortgagor or the
Mortgaged Property relating to any loss or injury resulting from any
Hazardous Substance, which if established, could have a material adverse
affect on the value of the Mortgaged Property of the financial condition of
Mortgagor or any tenant); and iii) Mortgagor's discovery of any occurrence or
condition on any real property adjoining or in the vicinity of the Mortgaged
Property that could cause the Mortgaged Property or any part thereof to be
subject to any material restriction on the ownership, occupancy,
transferability, or use of the Mortgaged Property under any Environmental Law.
(c) Mortgagor shall protect, indemnify, and hold harmless Mortgagee,
its directors, officers, employees, agents, successors, and assigns from and
against any and all loss, damage, cost, expense, or liability (including
attorneys' fees and costs) directly or indirectly arising out of or
attributable to the use, generation, manufacture, production, storage,
release, threatened release, discharge, disposal, or presence of a Hazardous
Substance on, under, or about the Mortgaged Property including without
limitation (i) all foreseeable consequential damages; and (ii) the costs of
any required or necessary repair, cleanup or detoxification of the Mortgaged
Property and the preparation and implementation of any closure, remedial, or
other required plans. This indemnity shall survive the extinguishment of the
lien by foreclosure or deed in lieu thereof, and this covenant shall survive
such reconveyance or extinguishment.
12
(d) In the event that any investigation, site monitoring,
containment, cleanup, removal, restoration, or other remedial work of any
kind or nature (the "Remedial Work") is reasonably necessary or desirable
under any applicable local, state, or federal law or regulation, any judicial
order, or by any governmental or nongovernmental entity or person because of,
or in connection with, such current, or future presence, suspected presence,
release or suspected release of a Hazardous Substance in or into the air,
soil, groundwater, surface water or soil vapor at, on, about, under or within
the Mortgaged Property (or any portion thereof), Mortgagor shall within
thirty (30) days after written demand for performance thereof by Mortgagee
(or such shorter period of time as may be required under any applicable law,
regulation, order, or agreement), commence to perform, or cause to be
commenced, and thereafter diligently prosecuted to completion, all such
Remedial Work. All Remedial Work shall be performed by one or more
contractors, approved in advance in writing by Mortgagee, and under the
supervision of a consulting engineer approved in advance in writing by
Mortgagee. All costs and expenses of such Remedial Work shall be paid by
Mortgagor including, without limitation, the charges of such contractor(s)
and/or the consulting engineer, and Mortgagee's reasonable attorneys' fees
and costs incurred in connection with monitoring or review of such Remedial
Work. In the event Mortgagor shall fail to timely commence, or cause to be
commenced, or fail to diligently prosecute to completion, such Remedial Work,
Mortgagee may, but shall not be required to, cause such Remedial Work to be
performed and all costs and expenses thereof, or incurred in connection
therewith, shall become part of the indebtedness secured hereby.
(e) Mortgagee is authorized by itself, its agents, employees or workmen
to enter at any reasonable time, after three (3) days prior notice, upon any
part of the Mortgaged Property for the purposes of inspecting the same for
Hazardous Substances and Mortgagor's compliance with this Section and such
inspections may include, without limitation, soil borings. Mortgagor agrees
to pay to Mortgagee, upon Mortgagee's demand, all expenses, costs or other
amounts incurred by Mortgagee in performing any reasonably necessary
inspection for the purposes set forth in this clause.
(f) "Environmental Laws" shall mean any federal, state or local law,
statute, ordinance, or regulation pertaining to health, industrial hygiene,
or the environmental conditions on, under or about the Mortgaged Property,
including without limitation the Comprehensive Environmental Response,
Compensation, and Liability act of 1980 ("CERCLA") as amended, 42 U. S. C.
Sections 9601 et seq., the Resource Conservation and Recovery Act of 1976
("RCRA"), 42 U.S.C. Sections 6901 et seq. The term "Hazardous Substances"
shall include without limitation: i) those substances included within the
definitions of "hazardous substances" "hazardous materials," "toxic
substances," or "solid waste" in CERCLA, RCRA, and the Hazardous Materials
Transportation Act, 49 U.S. C. Sections 1801 et M., and in the regulations
promulgated pursuant to said laws; ii) those substances listed in the United
States Department of Transportation Table (49 CFR 172. 101 and amendments
thereto) or by the Environmental Protection Agency (or any successor agency)
as hazardous substance (40 CFR Part 302.4
13
and amendments thereto); iii) such other substances, materials and wastes
which are or become regulated under applicable local, state or federal law,
or the United States government, or which are classified as hazardous or
toxic under federal, state, or local laws or regulations; and iv) any
material, waste or substance which is (A) petroleum, (B) asbestos, (C)
polychlorinated biphenyls, (D) designated as a "hazardous substance" pursuant
to Section 311 of the Clean Water Act, 33 U.S.C. 1251 et seq. (33 U.S.C.
1321) or listed pursuant to Section 307 of the Clean Water Act (33 U.S.C.
1317); (E) flammable explosives; or (F) radioactive materials.
(g) Mortgagee and its successors and assigns are hereby granted an
easement to enter, after three (3) days prior notice, and to authorize others
to enter upon the Land for the purposes of conducting environmental
investigations and audits (including taking physical samples) and such other
action deemed necessary by Mortgagee to insure compliance by Mortgagor with
all local, state or federal laws, rules or regulations. Mortgagor
acknowledges that no adequate remedy at law exists for a violation of the
easement granted herein and agrees that Mortgagee is entitled to specific
performance of its rights under this easement. The easement granted herein
shall continue until this Mortgage is cancelled or released of record.
20. Environmental Representations and Warranties. To induce the Mortgagee
to make the Loan evidenced by the Note, the Mortgagor makes the following
representations and warranties:
(a) The Mortgagor's business operations on the Mortgaged Property
and the Mortgaged Property are in substantial compliance with all
Environmental Laws;
(b) There has been no material enforcement, clean up, remedial,
removal, or other governmental or regulatory action, proceeding, or inquiry
instituted with respect to the Mortgagor's business operations or the
Mortgaged Property, except for minor spills of petroleum and related
products having no material, adverse impact on the value of the Mortgaged
Property;
(c) There have been no material claims made or threatened by any
third party against the Mortgagor relating to any damage, contribution,
cost recovery compensation, loss, or injury resulting from any Hazardous
Material used in the Mortgagor's business operation or located on the
Mortgaged Property;
(d) No portion of the property consists of filled land; and
(e) The property does not contain any Hazardous Materials, except for
petroleum and related products properly stored and used in the ordinary
course of business operations on the Mortgaged Property.
14
21. Additional Assessments. The Mortgagor shall pay when due the cost
of providing to Mortgagee, at Mortgagee's request from time to time, a
then-current environmental site assessment, audit, or survey ("Assessment")
of the Mortgaged Property which Assessment shall be prepared by an
environmental auditor acceptable to Mortgagee, in Mortgagee's sole
discretion; provided, however, that Mortgagee shall make such request no more
frequently than once every third year unless the loan evidenced by the Note
is being renewed, extended, modified, or accelerated, or unless Mortgagee is
required by any law, regulation, order, or other directive from
any regulatory agency having jurisdiction over Mortgagee to obtain any such
Assessment more frequently than once a year.
22. Governing Law. This instrument is to be governed by and construed
in accordance with the laws of the State of South Carolina and each of the
remedies provided for herein shall be cumulative so that the right of the
Mortgagee to exercise one or more of such remedies shall not be construed to
limit or preclude the right of the Mortgagee to exercise any other remedy or
remedies set forth herein.
23. No Waiver. No delay by Mortgagee in exercising any right or remedy
hereunder, or otherwise afforded by law, shall operate as a waiver thereof or
preclude the exercise thereof during the continuance of any default hereunder.
24. Miscellaneous. The covenants herein contained shall bind, and the
benefits and advantages shall inure to the respective heirs, executors,
administrators, successors and assigns of the parties hereto. Wherever used,
the singular number shall include the plural, the plural the singular, and
the use of any gender shall include all genders.
25. Benefits to Mortgagor. The undersigned Mortgagor represents to
Mortgagee that the Mortgagor is benefitted by the loans evidenced by the
Note, whether or not the Mortgagor is the obligor thereon, and that adequate
and sufficient consideration has been given to Mortgagor for its execution
and delivery of this Mortgage.
26. Security Agreement. This Mortgage creates a lien on the Mortgaged
Property, and to the extent the Mortgaged Property is not real property under
applicable law this Mortgage constitutes a security agreement under the South
Carolina Uniform Commercial Code and any other applicable law.
27. No Derogation. The grant of a security interest to Mortgagee in the
granting clauses of this Mortgage shall not be construed to derogate from or
impair the lien or provisions of or the rights of Mortgagee under this
Mortgage with respect to any property described therein which is real
property or which the parties have agreed to treat as real property. The
hereby stated intention of the Mortgagor and Mortgagee is that everything
used in connection with the production of income from such real property or
adapted for use thereon is, and at all times and for all purposes and in all
proceedings, both legal and equitable, shall be regarded as real property,
irrespective of whether or not the same is physically attached to the land or
the improvements thereon. If required by Mortgagee, at any time during the
term of this Mortgage,
15
Mortgagor will execute and deliver to Mortgagee, in form satisfactory to
Mortgagee, additional security agreements, financing statements and/or other
instruments covering all personal property or fixtures of Mortgagor which may
at any time be furnished, placed on, or annexed or made appurtenant to the
real property or used, useful or held for use, in the operation of the
Improvements.
28. Personal Property. As to any part of the Mortgaged Property
constituting personal property, Mortgagee may proceed as to such personal
property in accordance with Mortgagee's rights and remedies in respect to
such property or sell the personal property separately and without regard to
the remainder of the Mortgaged Property in accordance with Mortgagee's rights
and remedies provided by the South Carolina Uniform Commercial Code as well
as other rights and remedies available at law or in equity.
29. Financing Statements. With respect to those items of the
Additional Property which are or are to become fixtures related to the herein
described real estate, this Mortgage shall constitute a financing statement
filed as a fixture filing. The lien upon fixtures granted herein and
perfected hereby shall be in addition to and not in lieu of any lien upon
fixtures acquired under real property law.
30. Notices. Whenever this Mortgage requires or permits any notice,
request or demand by one party to the other, the notice, request or demand
must be in writing and shall be deemed to have been given if it is enclosed
in an envelope addressed to the party to be notified at the address stated
below (or such other address as may have been designated by written notice)
properly stamped, sealed, and deposited in the United States mail as
certified or registered mail, return receipt requested. The address of each
party for the purposes of Section are as follows:
If to the Mortgagor: Starmet CMI Corporation
X.X. Xxx 0000 Xxxxxxxx
XX 00000
Attn:
If to the Lender: Lower Savannah Regional Development Corporation
X.X. Xxx 000
Xxxxx, Xxxxx Xxxxxxxx 00000
Attn: Xxxx X. Xxxxxxxx
31. Mortgagor Information. The Mortgagor shall maintain full and
correct books and records showing in detail the earnings and expenses of the
Mortgaged Property and shall permit or cause the Mortgagor to permit the
Mortgagee and its representatives of examine said books and records and all
supporting vouchers and data at any time and from time to time upon
reasonable request by the Mortgagee.
32. Satisfaction and Release of Assignment of Rents. The release of
all or any part of the Mortgaged Property from the lien of this Mortgage
shall be deemed a release of such
16
property from the lien of the Assignment of Leases, Rents, and Profits and
Security Agreement of even date herewith executed by the Mortgagor in favor
of the Mortgagee.
33. Severability. If any provision hereof should be held unenforceable
or void, then such provision shall be deemed separable from the remaining
provisions and shall in no way affect the validity of this Mortgage except
that if such provision relates to the payment of any monetary sum, then,
Mortgagee may, at its option, declare the indebtedness and all other sums
secured hereby immediately due and payable.
34. Construction Mortgage. This Mortgage secures an Obligation
incurred for the construction of an improvement on land and is intended to be
a "construction mortgage" as defined in S.C. Code Xxx. Section 36-9-313, as
amended.
35. Instrument Under Seal. This Mortgage is intended to be and shall
be construed as an instrument under seal.
36. WAIVER OF STAY. IN THE EVENT OF THE COMMENCEMENT OF BANKRUPTCY
PROCEEDINGS BY OR AGAINST THE MORTGAGOR, TO THE EXTENT PERMITTED BY LAW,
MORTGAGOR HEREBY WAIVES THE BENEFIT OF THE AUTOMATIC STAY PROVIDED FOR BY 11
U.S. C. Section 362 AND/OR ANY STAY, INJUNCTION, OR RESTRAINING ORDER ISSUED
PURSUANT TO 11 U.S. C. Section 105 OR OTHERWISE. TO THAT END, MORTGAGOR
AGREES THAT IT WILL NOT SEEK OR ASSERT ANY SUCH STAY, INJUNCTION, OR
RESTRAINING ORDER AND MORTGAGOR HEREBY IRREVOCABLY CONSENTS TO AND AGREES NOT
TO OPPOSE THE MODIFICATION OF ANY SUCH STAY TO ALLOW FOR THE ENFORCEMENT BY
MORTGAGEE OF THIS MORTGAGE AND THE FORECLOSURE OR OTHER REALIZATION UPON THE
COLLATERAL PROVIDED FOR HEREIN.
37. WAIVER OF JURY TRIAL. MORTGAGOR, ANY OTHER OBLIGORS, AND THE
MORTGAGEE EACH WAIVE TRIAL BY JURY WITH RESPECT TO ANY ACTION, CLAIM, SUIT OR
PROCEEDING ON OR ARISING OUT OF THIS NOTE, THE OBLIGATIONS, THE CONDUCT OF
THE RELATIONSHIP BETWEEN MORTGAGEE AND MORTGAGOR, AND/OR THE CONDUCT OF THE
RELATIONSHIP BETWEEN MORTGAGEE AND ANY OBLIGORS. ANY LITIGATION ARISING
HEREUNDER OR RELATED HERETO MAY BE TRIED BY THE SOUTH CAROLINA COURTS FOR
XXXXXXXX COUNTY OR THE FEDERAL COURTS OF SOUTH CAROLINA, MORTGAGOR HEREBY
CONSENTS TO THE JURISDICTION OF SUCH COURTS.
38. WAIVER OF APPRAISAL RIGHTS. The laws of South Carolina provide
that in any real estate foreclosure proceeding a defendant against whom a
personal judgment is taken or asked may within thirty days after the sale of
the mortgaged property apply to the court for an order of appraisal. The
statutory appraisal value as approved by the court would be substituted for
the high bid and may decrease the amount of any deficiency owing in
connection with the transaction. THE UNDERSIGNED HEREBY WAIVES AND
RELINQUISHES THE
17
STATUTORY APPRAISAL RIGHTS WHICH MEANS THE HIGH BID AT THE JUDICIAL
FORECLOSURE SALE WILL BE APPLIED TO THE DEBT REGARDLESS OF ANY APPRAISED
VALUE OF THE MORTGAGED PROPERTY.
IN WITNESS WHEREOF, the Mortgagor has hereunto set its Hand and Seal as
of the date first written above.
________________________ STARMET CMI CORPORATION
By: /s/ Xxxxx X. Xxxxxxx
-----------------------------
Xxxxx X. Xxxxxxx
CFO
18
SOUTH CAROLINA,
XXXXXXXX COUNTY
I, Miles Xxxxxxxx, Notary Public for South Carolina, do hereby certify
that Starmet CMI Corporation a Delaware Corporation, by Xxxxx X. Xxxxxxx its
CFO, personally appeared before me this day and acknowledged the due
execution of the foregoing instrument.
Witness my hand and official seal this the 20th day of March, 1998
________________________________
Notary Public for South Carolina
My Commission Expires: _____
19
"EXHIBIT A"
THIS IS AN ADDENDUM ATTACHED TO AND MADE A PART OF A REAL ESTATE MORTGAGE
FROM STARMET CMI CORPORATION TO LOWER SAVANNAH REGIONAL DEVELOPMENT
CORPORATION DATED MARCH 20, 1998.
All that certain tract of land, with improvements thereon, containing 270
acres, situate in Barnwell (Red Oak) School District, County of Xxxxxxxx,
State of South Carolina, and being more fully shown and delineated on plat
prepared for Carolina Metals, Inc. by X. X. Xxx & Associates, R.L.S., dated
November 18, 1981, and recorded in Plat Cabinet A, Slide 1, at Page 6, in the
office of the Clerk of Court for Xxxxxxxx County, which plat is incorporated
into this description by reference thereto and to which plat reference is
made by a metes and bounds description of said land. Said tract is bounded
generally, now or formerly, as follows: North by lands of Catawba Newsprint
Company; East by S. C. Highway S-6-80; South by lands of the Xxxxxx Estate
and lands of Catawba Newsprint Company; and West by lands of the United
States Atomic Energy Commission.
Being the same premises conveyed to Carolina Metals, Inc., now known as
StarMet CMI Corporation, by deed of Catawba Newsprint Company dated November
20, 1981, and recorded November 23, 1981, in Deed Book 16-L, a Page 34, in
the office of the Clerk of Court for Xxxxxxxx County.
20
