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Exhibit 4(h)
SUBORDINATION AGREEMENT
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THIS AGREEMENT made and entered into this 1st day of November,
1995, by and between the CITY OF XXXXXXX, ARKANSAS, hereinafter
called the "City," MRL, INC. (formerly Missouri Research
Laboratories, Inc.), hereinafter called "Company" and DEPARTMENT OF
INDUSTRIAL DEVELOPMENT OF THE STATE OF ARKANSAS, hereinafter called
"Department."
WHEREAS, the City has heretofore authorized and issued its
Industrial Development Revenue Bonds - Missouri Research
Laboratories, Inc. Project, Series A, dated May 1, 1984 (the "Prior
Bonds"), in the original principal amount of $1,000,000, for the
purpose of financing the costs of acquiring and installing
equipment (the "Project") at a manufacturing plant located at 0000
Xxxx Xxxx Xxxxxx in the City (the "Plant") and more particularly
described as:
A part of the Southeast Quarter of the Northeast Quarter
(SE 1/4 NE 1/4) of Section Eleven (11) and together with
a part of the Southwest Quarter of the Northwest Quarter
(SW 1/4 (NW 1/4) of Section Twelve (12), all in Township
Twenty (20) North, Range Eight (8) East of the Fifth
Principal Meridian, more particularly described as
follows: Beginning at the Southeast corner of the said
SE 1/4 NE 1/4 of said Section 11 and run thence West 528
feet, thence North 0 degrees 15 minutes West 176 feet,
thence West 132 feet, thence North 0 Degrees 15 minutes
West 484 feet, thence East 520 feet, thence North 0
degrees 15 minutes West 137 feet, thence East 140 feet,
thence South 0 degrees 15 minutes East 137 feet, thence
East 100 feet, thence South 0 degrees 15 minutes East 660
feet, thence West 100 feet to the point of beginning, in
the Eastern District of Clay County, Arkansas;
and
WHEREAS, the Project is being leased by the City to the
Company, pursuant to a Lease and Agreement dated as of May 1, 1984
(the "Project Lease Agreement") filed for record in Miscellaneous
Record Book Xx. 00 xx xxxx 000, Xxxx Xxxxxx, Xxxxxxxx; and
WHEREAS, the City acquired title to the Plant with grant
moneys administered by the Department and is leasing the Plant to
the Company pursuant to a Lease and Loan Agreement dated November
30, 1983 and filed of record in Miscellaneous Record Book 10, at
page 567, Clay County, Arkansas (the "Plant Lease Agreement"); and
WHEREAS, the Prior Bonds are guaranteed by the Department,
pursuant to a Guaranty of Payment of Industrial Development Revenue
Bonds dated as of May 1, 1984 (the "Guaranty"), among the City, the
Department and Boatmen's Trust Company (as successor to Centerre
Trust Company of St. Louis), as Trustee (the "Trustee"); and
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WHEREAS, the Prior Bonds were issued under and are secured by
a Trust Indenture between the City and the Trustee, dated as of May
1, 1984, pursuant to which the City granted a mortgage lien on the
Plant and a security interest in the Project in favor of the
Trustee to secure the Prior Bonds; and
WHEREAS, the City has assigned its rights to payments due
under the Project Lease Agreement to pay the principal of and
interest on the Prior Bonds when due; and
WHEREAS, the Department is subrogated to the rights of the
City and the Trustee to the extent of payments made under the
Guaranty; and
WHEREAS, the Department made the principal and interest
payment due on the Prior Bonds on May 1, 1995, because the Company
failed to make its rental payment due under the Project Lease
Agreement on that date; and
WHEREAS, the Company remains in default under the Project
Lease Agreement; and
WHEREAS, the Department has redeemed the Prior Bonds as of
November 1, 1995, by paying the outstanding principal amount of the
Prior Bonds, plus accrued interest; and
WHEREAS, the Department had the option to foreclose on the
Project and Plant which would result in the loss of substantial
jobs and payrolls for the inhabitants of the City; and
WHEREAS, in lieu of exercising its right to foreclose on the
Plant and the Project, the Department offered, and the City and the
Company have agreed, to restructure the debt represented by the
Prior Bonds by the City issuing its Industrial Development Revenue
Refunding Bond - MRL, Inc. Project, Series 1995 (the "Refunding
Bond") to the Department, and by continuing to lease the Project to
the Company by extending the terms of the Project Lease Agreement
and restructuring the payments due as rent thereunder pursuant to
a First Supplemental Lease and Agreement between the Company and
the City, dated as of November 1, 1995 (the "Supplemental Lease
Agreement"); and
WHEREAS, the Refunding Bond will be issued in an amount not to
exceed $410,000; and
WHEREAS, the City, Company and Department have agreed that in
order to secure the indebtedness evidenced by the Refunding Bond
the City will execute and deliver to the Department an Indenture,
dated as of November 1, 1995 (the "Indenture") granting a valid
first mortgage lien on the Plant and a valid first security
interest in the Project; and
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WHEREAS, in order for the Department to acquire the first
mortgage lien and security interest on the Plant and Project, it is
necessary that the rights, title, interest of the City and the
Company in the Plant and Project evidenced by the Plant Lease
Agreement be subordinated to the mortgage and security interest of
the Department in the Plant and Project as evidenced by the
Indenture and the Supplemental Lease Agreement.
NOW, THEREFORE, in consideration of the premises, the City,
and the Company hereby covenant, consent and agree to and with the
Department, its successors and assigns, that all right, title,
interest, mortgage or security interest it may have in the Plant
and Project pursuant to the Project Lease Agreement, is hereby
subject to and subordinate to the mortgage and security interest of
the Department as evidenced by the Indenture and the Supplemental
Lease Agreement.
Except as to the subordination in priority to the mortgage and
security interest of the Department, any right, title, interest,
mortgage or security interest of the City and Company shall remain
in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused this
Subordination Agreement to be executed the day and year first above
written.
CITY OF XXXXXXX, ARKANSAS
BY: /s/ Xxxxxxx Xxxxxxx
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Mayor
ATTEST:
/s/ Xxxx Xxxx
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City Clerk
(SEAL)
MRL, INC.
BY: /s/ Xxxxx X. Xxxxxxxx
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Title: President
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ATTEST:
/s/ Xxxxx X. Xxxxx
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Title: Chief Financial Officer
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DEPARTMENT OF INDUSTRIAL
DEVELOPMENT OF THE STATE OF ARKANSAS
BY:---------------------------------
Title:------------------------------
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ACKNOWLEDGMENT
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STATE OF ARKANSAS )
)ss.
COUNTY OF CLAY )
On this ----- day of ------------, 1995, before me, a Notary
Public, duly commissioned, qualified and acting, within and for
said County and State, appeared in person the within named Xxxxxxx
Xxxxxxx and Xxxx Xxxx, to me personally well known, who stated at
they we the Mayor and City Clerk, respectively, of the City of
Xxxxxxx, Arkansas, and were duly authorized in their respective
capacities to execute the foregoing instrument for and in the name
and behalf of the City of Xxxxxxx, Arkansas, and further stated and
acknowledged that they had so signed, executed and delivered said
foregoing instrument for the consideration, uses and purposes
therein mentioned and set forth.
IN TESTIMONY WHEREOF, I have hereunto set my hand and official
seal.
/s/ Xxxx X. Xxxxxx
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Notary Public
My Commission Expires:
10-16-2002
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ACKNOWLEDGMENT
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STATE OF MISSOURI )
)ss.
COUNTY OF ST. XXXXXXX )
On this 31st day of October , 1995, before me, a Notary
---- --------
Public, duly commissioned, qualified and acting, within and for
said County and State, appeared in person the within named Xxxxx X.
--------
Xxxxxxxxx and Xxxxx X. Xxxxx, to me personally well known, who
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stated that they were the President and Chief Financial Officer,
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respectively, of MRL, Inc., a corporation, and were duly authorized
in their respective capacities to execute the foregoing instrument
for and in the name and behalf of said corporation, and further
stated and acknowledged that they had so signed, executed and
delivered said foregoing instrument for the consideration, uses and
purposes therein mentioned and set forth.
IN TESTIMONY WHEREOF, I have hereunto set my hand and
official seal.
/s/ Xxxxx X. Xxxxx
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Notary Public
My Commission Expires:
6-12-98
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ACKNOWLEDGMENT
--------------
STATE OF ARKANSAS )
)ss.
COUNTY OF PULASKI )
On this ---- day of ------------, 1995, before me, a
Notary Public, duly commissioned, qualified and acting, within and
for said County and State, appeared in person the within named W.
Xxxxxx Xxx, Jr., to me personally well known, who stated that he
was the ------------------------ of the Department of Industrial
Development of the State of Arkansas, and was duly authorized in
his capacity to execute the foregoing instrument for and in the
name and behalf of the Department of Industrial Development of the
State of Arkansas, and further stated and acknowledged that he had
so signed, executed and delivered said foregoing instrument for the
consideration, uses and purposes therein mentioned and set forth.
IN TESTIMONY WHEREOF, I have hereunto set my hand and
official seal.
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Notary Public
My Commission Expires:
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