10.02
THIS DOCUMENT IS ALSO A FIXTURE FILING IN ACCORDANCE WITH
NRS 104.9402(6)
DEED OF TRUST
ASSIGNMENT OF RENTS AND ROYALTIES,
SECURITY AGREEMENT AND FINANCING STATEMENT
(NEVADA)
THIS DEED OF TRUST WITH ASSIGNMENT OF RENTS AND ROYALTIES,
SECURITY AGREEMENT AND FINANCING STATEMENT (the "Deed of Trust"),
is made as of the 10th day of April, 1997, by ALTA GOLD CO., a
Nevada corporation, herein called "Trustor", whose mailing
address is 000 Xxxxxxx Xxxxx Xxxxx, Xxxxx 00, Xxxxxxxxx, Xxxxxx
00000, in favor of FIRST AMERICAN TITLE COMPANY OF NEVADA, a
Nevada corporation, as trustee, herein called "Trustee", whose
address is 000 Xxxxx Xxxxxx, Xxxx, Xxxxxx 00000, for the benefit
of BHF-BANK AKTIENGESELLSCHAFT, NEW YORK BRANCH with its
principal office at 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000-
2540 ("BHF") and XXXXXX METALS, INC., a Delaware corporation with
an office located at 0 Xxxx Xxxxx Xxxx, Xxxxxxxx, Xxxxxxxxxxx
00000 ("Xxxxxx" and together with BHF, each a "Beneficiary" and
collectively the "Beneficiaries"). Capitalized terms used herein
and not otherwise defined herein shall have the meanings ascribed
thereto in the "Loan Agreement" (as defined below).
W I T N E S S E T H
FOR GOOD AND VALUABLE CONSIDERATION, the receipt and
sufficiency of which are hereby acknowledged, Trustor hereby
irrevocably grants, transfers and assigns to Trustee in trust
with power of sale and right of entry and possession, all right,
title and interest which Trustor presently has or may hereafter
acquire in and to certain mining claims, easements, rights of way
and water rights, consisting of patented mining claims,
unpatented mining claims, unpatented millsite claims (and any
amendments or relocations of such unpatented mining and millsite
claims) and water rights, on properties (the "Mining Property")
located in Elko and White Pine Counties, Nevada, as more
particularly described in EXHIBITS A AND B hereto and made a part
hereof;
TOGETHER with all precious and non-precious metals and other
mineral deposits, ore in place or otherwise, water and water
rights (including, without limitation, the water rights permits
described in EXHIBITS A AND B hereto), leases covering any of the
Mining Property, assignable governmental permits, easements,
royalties in favor of Trustor, revenues, rents, issues, proceeds,
including cash proceeds, and profits thereof, said items to be
collectively a part of and included in the term "Mining
Property"; subject, however, to the right, power and authority
hereinafter given
to and conferred upon each Beneficiary to collect and apply such
rents, royalties, issues, revenues and profits.
FOR THE PURPOSE OF SECURING:
I. Full and timely payment and performance by Trustor
of each and every agreement, covenant, term and condition of (i)
that certain Loan Agreement of even date herewith among Trustor
and each Beneficiary (as amended, hereinafter referred to as the
"Loan Agreement"); (ii) that certain Refining Agreement of even
date herewith between Trustor and Xxxxxx (as amended, the
"Refining Agreement"); (iii) that certain Trading Agreement of
even date herewith between Trustor and Xxxxxx (as amended, the
"Trading Agreement"), (iv) that certain Secured Promissory Note
of even date herewith issued by Trustor to BHF pursuant to the
Loan Agreement and that certain Secured Promissory Note of even
date herewith issued by Trustor to Xxxxxx pursuant to the Loan
Agreement (each a Note and, collectively, the "Notes"); and (v)
all other agreements and instruments now or hereafter securing
either of the Note or the Loan Agreement (the documents referred
to in the immediately preceding clauses (i) through (v),
inclusive, collectively the "Loan Documents" and individually as
a "Loan Document").
II. Full and timely performance of each agreement of
Trustor herein contained.
III. Full and timely performance by Trustor of all the
terms, conditions, agreements and obligations in the Loan
Documents.
IV. Full and timely payment of all monies which become
due and payable to either Beneficiary or Trustee under the
provisions of this Deed of Trust.
TRUSTOR REPRESENTS AND WARRANTS THAT:
Trustor is the sole owner of the Mining Property and
there are no liens or encumbrances affecting the Mining Property
which have been created by, through or under Trustor, other than
the lien of this Deed of Trust which shall be and remain a first
lien on the Mining Property (subject only to (i) in the case of
unpatented mining claims, the paramount title of the United
States of America and the requirements of a valid discovery and
(ii) liens imposed by a governmental authority for taxes,
assessments or charges not yet due.
TO PROTECT THE SECURITY OF THIS DEED OF TRUST, TRUSTOR
AGREES:
A. To keep the Mining Property in good condition and
repair; not to remove or demolish any structure or improvement
used in the operation of the Mining Property, except in the
ordinary course; to complete or restore promptly and in a good
and workmanlike manner any structure and improvement which may be
constructed, damaged or destroyed thereon, except in the ordinary
course; to comply with all material and applicable laws affecting
the Mining Property or requiring any alterations or improvements
to be made thereon; and not to commit, suffer or permit any act
upon the Mining Property in violation of a material and
applicable law (except that, in the case of any violation of
health and safety laws or environmental laws, the violation shall
not
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be a default so long as Trustor is diligently effecting a cure of
the same) or which could invalidate any insurance coverage on the
Mining Property; not to abandon any mining claims other than non-
millsite claims with no proven reserves and as to which the prior
written consent of each Beneficiary has been obtained, which
consent will not be unreasonably withheld.
B. To provide, maintain and deliver to each
Beneficiary fire and extended coverage insurance on the
structures located on the Mining Property in a sum no less than
the value thereof with loss payable to Beneficiaries, as their
respective interests appear, in such form, for such periods and
written by such companies as may be reasonably satisfactory to
Beneficiaries; all such policies shall provide for at least
thirty (30) days' written minimum cancellation notice to each
Beneficiary; Trustor shall furnish each Beneficiary with
certificates or other evidence satisfactory to such Beneficiary
of compliance with the foregoing insurance provisions.
C. To appear in and defend any action or proceeding
purporting to affect the security hereof, and to pay all costs
and expenses of all parties, including each beneficiary and,
including cost of evidence to title and attorneys' fees, in any
such action or proceeding in which any Beneficiary or Trustee may
appear, and in any suit brought by any Beneficiary to foreclose
or enforce any provisions of this Deed of Trust.
D. To pay, at least ten (10) days before delinquency,
all claim maintenance fees, taxes and assessments affecting the
Mining Property and, when due, all material encumbrances, charges
and liens on the Mining Property or any part thereof, with
interest, which appear to be prior or superior hereto, except
permitted liens as set forth in EXHIBIT C hereto, and provided
that Trustor shall have the right to contest the same.
E. To pay immediately upon notice all sums expended by
any Beneficiary or Trustee pursuant to the provisions of this
Deed of Trust (including, without limitation, expenses incurred
under paragraph 6 below), with interest from date such notice is
given, at the Default Rate (as provided in the Loan Agreement);
provided, however, all agreements between Trustor and
Beneficiaries are hereby expressly limited so that in no
contingency or event whatsoever, whether by reason of
acceleration of maturity of the indebtedness evidenced hereby or
otherwise, shall the amount paid or agreed to be paid to
Beneficiaries for the use, forbearance or detention of
indebtedness evidenced or secured hereby exceed the maximum
permissible under applicable law. As used herein, the term
"applicable law" shall mean the law in effect as of the date
hereof, provided, however, that in the event there is a change in
the law which results in a higher permissible rate of interest,
then this Deed of Trust shall be governed by such new law as of
its effective date. In this regard, it is expressly agreed that
it is the intent of Trustor and Beneficiaries in the execution,
delivery and acceptance of this Agreement to contract in strict
compliance with the laws of the State of New York from time to
time in effect. If, from any circumstance whatsoever,
fulfillment of any provision hereof or of the Loan Documents at
the time performance of such provision shall be due, shall
involve transcending the limit of validity prescribed by law,
then the obligation to be fulfilled shall automatically be
reduced to the limit of such validity, and if from any
circumstances Beneficiaries should ever receive as interest an
amount which would exceed the highest lawful rate such amount
which would be excessive interest shall be applied to the
reduction of the principal balances of the Notes and not to the
payment of interest. This
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provision shall control every other provision of all agreements
between Trustor and Beneficiaries in connection with the
transactions provided for in the Loan Documents.
F. Should Trustor fail to make any payment or to do
any act as herein provided, then any Beneficiary or Trustee, but
without obligation to do so, and upon twenty (20) days' written
notice or demand upon Trustor, and without releasing Trustor from
any obligation hereof, Trustee or such Beneficiary may make or do
the same in such manner and to such extent as either may deem
necessary to protect the security hereof, such Beneficiary or
Trustee being authorized to enter upon the Mining Property for
such purposes, to appear in and defend any action or proceeding
purporting to affect the security hereof or the rights or powers
of such Beneficiary or Trustee, and to pay, purchase, contest or
compromise any encumbrance, charge or lien which in the judgment
of either appears to be prior or superior hereto, except
permitted liens as set forth in EXHIBIT C hereto, and, in
exercising any such powers, to pay (or reimburse each Beneficiary
for) necessary expenses, employ counsel and pay reasonable
counsel fees.
G. To perform all work on the Mining Property in a
good workmanlike and minerlike manner; to comply in all material
respects with all applicable laws, rules and regulations of any
governmental agency, whether state or federal, including, without
limitation, all laws, rules and regulations relating to the
maintenance and reclamation of the Mining Property to the extent
that such is required for activities conducted during the term
hereof; and to perform all work, including required reclamation,
in a timely fashion and hold such Beneficiary and Trustee
harmless from any liability therefor.
H. Subject to permitted liens as set forth in EXHIBIT
C hereto, to do all things necessary to maintain this Deed of
Trust as a prior perfected lien on the Mining Property; and to
allow no liens to remain on the Mining Property on account of any
debt for materials or services furnished to Trustor for the
benefit of the Mining Property during the term hereof.
I. To hold each Beneficiary and Trustee harmless and
indemnify each Beneficiary and Trustee against any claims,
losses, damages, expenses and attorneys' fees, and to defend each
Beneficiary and Trustee from any suit, claim, judgment or demand
whatsoever, relating to or arising out of this Deed of Trust, the
Loan Agreement or any transaction contemplated hereby or thereby.
J. To maintain at its sole expense liability insurance
covering the activities on the Mining Property and naming each
Beneficiary and Trustee as co-insureds. At Trustor's sole
option, such insurance may be by way of endorsement to Trustor's
general liability insurance or by separate policy. Such policy
shall have personal injury limits of not less than One Million
Dollars ($1,000,000) per person and Two Million Dollars
($2,000,000) per accident, and Six Million Dollars ($6,000,000)
umbrella coverage. All such policies shall be prepaid annually
in advance and shall provide for at least ten (10) days' written
minimum cancellation notice to each Beneficiary; Trustor shall
furnish each Beneficiary with certificates or other evidence
satisfactory to such Beneficiary of compliance with the foregoing
insurance provisions. Each Beneficiary and Trustee shall be
provided with a copy of the insurance policy in force within ten
(10) days of the receipt of such policy by Trustor.
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K. To pay maintenance fees or perform such labor as is
required to maintain all unpatented mining claims included in the
Mining Property, to timely record and file appropriate proofs
thereof with the County Recorders of Elko and White Pine
Counties, Nevada, the United States Bureau of Land Management,
and such other place or places as may be required from time to
time and to furnish to each Beneficiary and Trustee appropriate
proofs of such payment or performance. As to unpatented millsite
claims, Trustor shall timely record and file with the County
Recorders of Elko and White Pine Counties, Nevada, the United
States Bureau of Land Management and such other place or places
as may be required from time to time and shall furnish to
Beneficiary and Trustee appropriate proofs of such payment or
performance.
In the event of the repeal or substantial modification
of the current General Mining Law during the life of this Deed of
Trust with Assignment of Rents and Royalties, Security Agreement
and financing statement, such that the interest of Trustor
hereunder is modified, reduced or transformed, Trustor shall
consult with Beneficiary to determine how best to preserve the
interests of Beneficiary hereunder. Trustor shall take no action
as a result of such repeal or substantial modification without
the written consent of each Beneficiary having been first
obtained, such consent not to be unreasonably withheld.
L. If any state, federal, municipal or other
governmental law, order, rule or regulation, passed subsequent to
the date hereof, in any manner changes or modifies existing laws
governing the taxation of deeds of trust or debts secured by
deeds of trust, or the manner of collecting taxes so as to
materially and adversely affect the rights of any Beneficiary,
the entire balance of the indebtedness and other sums secured by
this Deed of Trust and all interest accrued thereon shall (unless
Trustor makes such Beneficiary whole) upon thirty (30) days'
notice become due and payable forthwith at the option of such
Beneficiary.
IT IS MUTUALLY AGREED THAT:
1. The parties to this Deed of Trust agree that their
rights and obligations under this Deed of Trust and under the
Loan Agreement and the Notes shall be governed by and construed
and interpreted in accordance with the laws of the State of New
York, without giving effect to the conflicts-of-law rules and
principles of such state. The parties further agree and
stipulate that the State of New York has a substantial
relationship to the parties and to the underlying transactions
secured by this Deed of Trust. Notwithstanding the foregoing,
the parties agree that:
(a) The procedures governing the enforcement by
any Beneficiary of the provisional remedies against
Trustor, including by way of illustration but not
limitation, actions for replevin, for claim and
delivery of property, for injunctive relief or for the
appointment of a receiver shall be governed by the laws
of the State of Nevada;
(b) Trustee shall comply with applicable Nevada
law to the extent required in connection with the
foreclosure of the security interests and liens created
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hereby; provided, however, that this subparagraph shall
in no event be construed to provide that the
substantive law of the State of Nevada shall apply to
the indebtedness secured by this Deed of Trust or
evidenced by the Loan Agreement or any Note, which are
and shall continue to be governed by the substantive
law of the State of New York. The parties further
agree that any Beneficiary may enforce its rights under
this Deed of Trust, the Loan Agreement and any Note,
including, but not limited to, its rights to xxx
Trustor, to collect any outstanding indebtedness or to
obtain a judgment for any deficiency following
foreclosure, in accordance with the laws of the State
of New York, and Trustor hereby waives, to the maximum
extent permitted by applicable law, any rights which it
may have under anti-deficiency legislation. Trustor
agrees to pay all reasonable attorneys' fees and legal
expenses incurred in enforcing the rights, powers and
remedies of Trustee and each Beneficiary under this
Deed of Trust.
2. Notwithstanding anything contained herein which may
be to the contrary, this Deed of Trust, the Loan Agreement, any
agreement, deed of trust or other document referred to herein by
reference, whether specifically or generally, and the
transactions contemplated hereby do not and will not constitute,
create, indirect, actual or practical ownership of Trustor by any
Beneficiary, or control, affirmative or negative, direct or
indirect, by any Beneficiary over the programming, management, or
any other aspect of the day-to-day operation of Trustor, which
control remains in Trustor, its shareholders and board of
directors.
3. By allowing payment of any sum secured hereby after
its due date, neither Beneficiary waives its rights either to
require prompt payment when due of all other sums so secured or
to declare default for failure to pay such other sums when due.
4. Upon written request of each Beneficiary stating
that all sums secured hereby have been paid, and upon surrender
of this Deed of Trust and a copy of the Notes and Loan Agreement
marked "Paid" and certified to be a true and correct copy by each
Beneficiary to Trustee, and upon payment of its fees, Trustee
shall reconvey to Trustor, without warranty, the real property
then held hereunder.
5. Trustor hereby gives to and confers upon each
Beneficiary the right, power and authority, during the
continuance of this Deed of Trust, to collect the rents,
royalties due to Trustor, issues and profits of the Mining
Property. Prior to the occurrence of any Event of Default (as
that term is herein defined) by Trustor, Trustor shall have a
license to collect and retain such rents, royalties, issues and
profits as they become due and payable, which license shall be
terminable at the sole option of either Beneficiary upon the
occurrence and during the continuance of any Event of Default.
6. Upon the occurrence of any Event of Default, each
Beneficiary may, upon twenty (20) days' written notice, either in
person, by agent or by a receiver to be appointed by a court, and
without regard to the adequacy of any security for the
indebtedness or obligations secured hereby, enter upon and take
possession of the Mining Property or any part thereof in its own
name, xxx for or otherwise collect such rents, royalties, issues
and profits, including those
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past due and unpaid, and apply the same, less costs and expenses
of operation and collection, including reasonable attorneys'
fees, upon any indebtedness or obligation secured hereby, in such
order as such Beneficiary may determine.
7. It is understood and agreed that neither the
foregoing assignment of rents and royalties, issues and profits
to any Beneficiary nor the exercise by such Beneficiary of any of
its rights or remedies under this Deed of Trust, shall be deemed
to make such Beneficiary "mortgagee-in-possession" or otherwise
responsible or liable in any manner with respect to the Mining
Property or the use, occupancy, enjoyment or operation of all or
any portion thereof, unless and until such Beneficiary, in person
or by agent, assumes actual possession thereof; nor shall the
appointment of a receiver for the Mining Property by any court,
either at the request of such Beneficiary or by agreement with
Trustor, or the entering into possession of the Mining Property
or any part thereof by such receiver be deemed to make such
Beneficiary "mortgagee-in-possession" or otherwise responsible or
liable in any manner with respect to the Mining Property or the
use, occupancy, enjoyment or operation of all or any portion
thereof. Further, the entering upon and taking possession of the
Mining Property, the collection of such rents, royalties, issues
and profits, and the application thereof as aforesaid, shall not
cure or waive any default or notice of default hereunder or
invalidate any act done pursuant to such notice.
8. The following definitions shall apply for purposes
of this paragraph 8 and paragraphs 9, 10, 11 and 12 below:
(a) "Environmental Laws" shall mean and include
each and every federal, state or local statute,
regulation or ordinance or any judicial or
administrative decree or decision, whether now existing
or hereafter enacted, promulgated or issued, with
respect to any Hazardous Materials (as hereinafter
defined), drinking water, groundwater, wetlands,
landfills, open dumps, storage tanks, underground
storage tanks, solid waste, waste water, storm water
run-off, waste emissions or xxxxx, but taking into
account exceptions and exclusions applicable to the
mining industry in general. Without limiting the
generality of the foregoing, the term shall encompass
each of the following statutes and regulations
promulgated thereunder as well as any amendments and
successors to such statutes and regulations, as may be
enacted and promulgated from time to time: (i) the
Comprehensive Environmental Response, Compensation and
Liability Act of 1980 (codified in scattered sections
of 26 U.S.C., 33 U.S.C., 42 U.S.C. and 42 U.S.C. Sec. 9601
ET SEQ.); (ii) the Resource Conservation and Recovery
Act of 1976 (42 U.S.C. Sec. 6901 ET SEQ.); (iii) Hazardous
Materials Transportation Act (49 U.S.C. Sec. 1801 ET SEQ.);
(iv) the Toxic Substances Control Act (15 U.S.C. Sec. 2061
ET SEQ.); (v) the Clean Water Act (33 U.S.C. Sec. 1251 ET
SEQ.); (vi) the Clean Air Act (42 U.S.C. Sec. 7401 ET
SEQ.); (vii) the Safe Drinking Water Act (21 U.S.C.
Sec. 349; 42 U.S.C. Sec. 201 and Sec. 300f ET SEQ.); (viii)
the National Environmental Policy Act of 1969 (42 U.S.C.
Sec. 4321); (ix) the Superfund Amendment and
Reauthorization Act of 1986 (codified in scattered
sections of 10 U.S.C., 29 U.S.C., 33 U.S.C. and 42
U.S.C.); and (x) Title III of the Superfund Amendment
and Reauthorization Act (40 U.S.C. Sec. 1101 ET SEQ.).
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(b) "Hazardous Materials" shall mean each and
every element, compound, chemical mixture, contaminant,
pollutant, material, waste or other substance which is
defined, determined or identified as hazardous or toxic
under any Environmental Law but taking into account
exceptions and exclusions applicable to the mining
industry in general. Without limiting the generality
of the foregoing, the term shall mean and include:
(i) "chemical substance or mixture" as
defined in the Toxic Substances Control Act, as
amended, and regulations promulgated thereunder;
(ii) "hazardous materials" as defined in the
Hazardous Materials Transportation Act, as
amended, and regulations promulgated thereunder;
(iii) "hazardous substances" as defined in
the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, the
Superfund Amendment and Reauthorization Act of
1986, or Title III of the superfund Amendment and
Reauthorization Act, each as amended, and
regulations promulgated thereunder;
(iv) "hazardous waste" as defined in the
Resource Conservation and Recovery Act of 1976, as
amended, and regulations promulgated thereunder;
(c) "Indemnified Parties" shall mean Trustee,
each Beneficiary, their respective parent, subsidiaries
and affiliates, each of their respective shareholders,
directors, officers, employees and agents, and the
successors and assigns of any of them; and "Indemnified
Party" shall mean any one of the Indemnified Parties.
(d) "Release" shall mean any reportable spilling,
leaking, pumping, pouring, emitting, emptying,
discharging, injecting, storing, escaping, leaching,
dumping, or discarding, burying, abandoning, or
disposing into the environment.
(e) "Threat of Release" shall mean a substantial
likelihood of a Release which requires action to
prevent or mitigate damage to the environment which may
result from such Release.
9. Trustor represents and warrants to Trustee and each
Beneficiary as follows:
(a) To Trustor's knowledge, no condition,
activity or conduct currently exists on or in
connection with the Mining Property which constitutes a
material violation of any Environmental Law.
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(b) During Trustor's ownership and, to Trustor's
knowledge prior to its ownership, there has been no
Release or Threat of Release of any Hazardous Materials
on, upon or into the Mining Property which have not
been corrected, nor, to Trustor's knowledge, has there
been any such Release or Threat of Release of any
Hazardous Materials on, upon or into any real property
in the vicinity of the Mining Property which, through
soil or groundwater migration, could reasonably be
expected to come to be located on the Mining Property.
(c) To Trustor's knowledge, there are no existing
or closed underground storage tanks on the Mining
Property.
(d) To Trustor's knowledge, none of the following
are or will be located in, on, under or constitute a
part of the Mining Property: asbestos or asbestos-
containing material in any form or condition; urea
formaldehyde insulation; transformers or other
equipment which contain dicletric fluid containing
polychlorinated biphenyls; or leaded paint.
(e) To Trustor's knowledge, there are no existing
or closed sanitary landfills (other than any existing,
licensed and active sanitary landfill on the Mining
Property), solid hazardous waste disposal sites, or
hazardous waste treatment, storage or disposal
facilities on or affecting the Mining Property.
(f) No notice has been issued to Trustor by any
agency, authority, or unit of government that Trustor
has been identified as a potentially responsible party
under any Environmental Laws with respect to the Mining
Property.
(g) There exists no investigation, action,
proceeding, or claim by any agency, authority, or unit
of government or by any third party which could result
in any material liability, penalty, sanction, or
judgment under any Environmental Law with respect to
any condition, use or operation of the Mining Property.
(h) There has been no claim by any party that any
use, operation, or condition of the Mining Property has
caused any nuisance.
10. Trustor covenants and agrees with Trustee and each
Beneficiary that Trustor shall:
(a) comply in all material respects with all
applicable Environmental Laws;
(b) not store (except in material compliance with
all applicable Environmental Laws pertaining thereto),
dispose of, Release or allow the Release of any
Hazardous Materials on the Mining Property;
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(c) neither directly nor indirectly transport or
arrange for the transport of any Hazardous Materials
(except in material compliance with all applicable
Environmental Laws pertaining thereto); and
(d) upon the request of Trustee or any
Beneficiary, take all reasonable action (including,
without limitation, the conducting of environmental
assessments at the sole expense of Trustor in
accordance with paragraph 12 below) to confirm that no
Hazardous Materials are or ever were stored, Released
or disposed of on the Mining Property.
11. Trustor covenants and agrees, at Trustor's sole
cost and expense, to indemnify, defend (at trial and appellate
levels, and with attorneys, consultants and experts acceptable to
Trustee and each Beneficiary) and hold each Indemnified Party
harmless from and against any and all liens, damages, losses,
liabilities, obligations, settlement payments, penalties,
assessments, citations, directives, claims, litigation, demands,
defenses, judgments, suits, proceedings, costs, disbursements or
expenses of any kind or of any nature whatsoever (including,
without limitation, attorneys', consultants' and experts' fees
and disbursements incurred in investigating, defending, settling
or prosecuting any claim, litigation or proceeding) which may at
any time be imposed upon, incurred by or asserted or awarded
against such Indemnified Party or the Mining Property and arising
directly or indirectly from or out of:
(a) the Release or Threat of Release of any
Hazardous Materials on, in, under or affecting all or
any portion of the Mining Property or any surrounding
areas, regardless of whether or not caused by or within
the control of Trustor;
(b) the violation of any Environmental Laws
relating to or affecting the Mining Property or
Trustor, whether or not caused by or within the control
of Trustor;
(c) the failure of Trustor to comply fully with
the terms and conditions of this paragraph 11;
(d) the violation of any Environmental Laws in
connection with other real property of Trustor which
gives or may give rise to any rights whatsoever in any
party with respect to the Mining Property by virtue of
any Environmental Laws;
(e) the breach of any representation or warranty
contained in this paragraph 11; or
(f) the enforcement of this paragraph 11,
including, without limitation (i) the costs of
assessment, containment and/or removal of any and all
Hazardous Materials from all or any portion of the
Mining Property or any surrounding areas, (ii) the
costs of any actions taken in response to a Release or
Threat of Release of any Hazardous Materials on, in,
under or affecting all or any portion of the Mining
Property or any surrounding areas to prevent or
minimize such Release or Threat
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of Release so that it does not migrate or otherwise
cause or threaten danger to present or future public
health, safety, welfare or the environment, and (iii)
costs incurred to comply with the Environmental Laws in
connection with all or any portion of the Mining
Property or any surround areas. Trustee's rights under
this paragraph shall be in addition to all other rights
of Trustee under this Deed of Trust, and the other
documents and payments by Trustor under this paragraph
shall not reduce Trustor's obligations and liabilities
under any document.
12. If Trustor receives any notice or obtains
knowledge of (i) any potential or known Release or Threat of
Release of any Hazardous Materials at or from the Mining
Property, notification of which must be given to any governmental
agency under any Environmental Law, or notification of which has,
in fact, been given to any governmental agency, or (ii) any
complaint, order, citation or notice with regard to air
emissions, water discharges, or any other environmental health or
safety matter affecting Trustor and the Mining Property (an
"Environmental Complaint") from any person or entity (including,
without limitation, the Environmental Protection Agency), which
would materially adversely affect Trustor's ability to pay the
Obligations, then Trustor promptly shall notify Trustee and each
Beneficiary orally and in writing of said Release or Threat of
Release or Environmental Complaint. Upon such notification, any
Beneficiary may, at its election without regard to whether an
Event of Default has occurred, obtain one or more environmental
assessments of the Mining Property prepared by a geohydrologist,
an independent engineer or other qualified consultant or expert
approved by each Beneficiary which evaluates or confirms (i)
whether any Hazardous Materials are present in the soil or water
at or adjacent to the Mining Property, and (ii) whether the use
and operation of the Mining Property comply in all material
respects with all applicable Environmental Laws. Environmental
assessments may include detailed visual inspections of the Mining
Property, including, without limitation, any and all storage
areas, storage tanks, drains, dry xxxxx and leaching areas, and
the taking of soil samples, surface water samples and ground
water samples, as well as such other investigations or analyses
as are necessary or appropriate for a complete determination of
the compliance of the Mining Property and the use and operation
thereof with all applicable Environmental Laws. All such
environmental assessments shall be at the reasonable cost and
expense of Trustor.
13. The following shall be deemed to be events of
default hereunder ("Events of Default"):
(a) The occurrence of any Event of Default under
the Loan Agreement, the Refining Agreement, the Trading
Agreement or any Loan Document;
(b) Any default in the payment when due of the
principal of, or fees or interest on indebtedness
evidenced by, any Note;
(c) Failure by Trustor to timely perform, comply
with or observe any term, covenant, agreement or
provision contained in this Deed of Trust and such
failure shall continue unremedied for a period of
twenty (20) days after notice thereof to Trustee by any
Beneficiary or such longer period (but in any event not
longer than
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thirty (30) days) as may be required to complete
performance of such obligation (but only if such
performance is diligently commenced during such twenty
(20) day period and diligently continued during such
longer period, and provided that the delay occasioned
by such longer period would not, in the reasonable
judgment of such Beneficiary, have a material adverse
affect on the financial condition, operations or
business taken as a whole of Trustor);
(d) Any representation or warranty made by
Trustor in or in connection with the execution,
delivery or performance of this Deed of Trust, the Loan
Agreement, any Note, any Loan Document or any
agreement, deed of trust or other document referred to
herein by reference, whether specifically or generally,
shall prove to have been false or misleading in any
material respect when made;
(e) Any statement made by Trustor or in or
pursuant to this Deed of Trust, the Loan Agreement, any
Note, any Loan Document or any agreement, deed of trust
or other document referred to herein by reference,
whether specifically or generally, or in any
certificate, notification or report furnished pursuant
to said documents shall prove to have been false or
misleading in any material respect when made;
(f) Default with respect to any evidence of
indebtedness of Trustor, if the effect of such default
is to accelerate the maturity of such indebtedness;
(g) Institution of judicial or nonjudicial
foreclosure or other proceedings to enforce any other
deed of trust or any junior security interest or other
lien or encumbrance, of any kind, upon the Mining
Property or any portion thereof, including proceedings
relating to the underlying property;
(h) Entry of any judgment against Trustor upon
which execution may be entered without being stayed on
appeal or dismissed within twenty (20) days thereof on
a claim not covered by insurance in an amount which, in
the reasonable opinion of any Beneficiary, if Trustor
were required to pay such amount, would adversely
affect Trustor's ability to pay its indebtedness under
the Loan Agreement, any Note, this Deed of Trust, any
Loan Document or any other agreement, deed of trust or
other document referred to herein by reference, whether
specifically or generally, or to perform its other
material obligations thereunder;
(i) Revocation or material variance of any
government approval required for the execution and
performance of Trustor's obligations under this Deed of
Trust, the Loan Agreement, any Note, any Loan Document
or any other agreement, deed of trust or other document
referred to herein by reference, whether specifically
or generally, as determined by any Beneficiary, under
this Deed of Trust, the Loan Agreement, any Note, any
Loan Document or any other
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agreement, deed of trust or other document referred to
herein by reference, whether specifically or generally;
(j) This Deed of Trust, the Loan Agreement, any
Note, any Loan Document or any other agreement, deed of
trust or other document referred to herein by
reference, whether specifically or generally or whether
partially or wholly, ceases to be in full force and
effect or the validity, binding effect or
enforceability thereof or any provision thereof has
been denied or disaffirmed by any party thereto (other
than any Beneficiary) or is declared or becomes void,
voidable or unenforceable;
(k) Without the prior written consent of each
Beneficiary, Trustor ceases or threatens to cease,
except for normal shutdowns or force majeure, to carry
on business or a substantial part of Trustor's property
or assets are seized (other than with payment of fair
and adequate compensation therefor);
(l) Failure to perform or observe any material
covenant, agreement or obligation undertaken by Trustor
in any agreement, lease or license pertaining to the
business conducted on the Mining Property (including,
without limitation, mineral leases, licenses and
tenements), and such default, is not remedied to the
reasonable satisfaction of each Beneficiary within
twenty (20) days after written notice of the default is
given to Trustor by any Beneficiary;
(m) Cancellation, surrender or voiding of any
agreement, lease, license or tenements pertaining to
the business conducted on the Mining Property (except a
surrender of an agreement, lease or license conditional
upon the grant of a substitute, substantially equal and
similar document), or, in the reasonable opinion of any
Beneficiary, the terms thereof are materially varied to
the prejudice of the holders or persons (including
Trustor) entitled to the benefit thereof except in
accordance with the terms thereof;
(n) Occurrence of any change in the financial
position of Trustor which in the reasonable opinion of
any Beneficiary adversely affects in a material and
adverse way the ability of Trustor to observe and
perform its obligations under this Deed of Trust or any
other agreement, deed of trust or other document
referred to herein by reference, whether specifically
or generally;
(o) Any encumbrance, sale, lease, assignment or
other transfer of any portion of the Mining Property is
made by Trustor.
14. If any Event of Default shall have occurred and be
continuing:
(a) Any Beneficiary may execute or cause Trustee
to execute a written notice of such default and of such
Beneficiary's election to cause the Mining Property, or
any portion thereof, to be sold to satisfy all
agreements and
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obligations hereunder, and shall cause any such notice
to be recorded in the Office of the Recorder of each
county wherein the Mining Property or some part thereof
is situated.
(b) Notice of sale having been given as then
required by law, and not less than the time then
required by law having elapsed after recordation of
such notice of default, Trustee, without demand on
Trustor, may sell the Mining Property at the time and
place of sale fixed by it in said Notice of Sale,
either as a whole or in separate parcels and in such
order as it may determine, at public auction to the
highest bidder for cash in lawful money of the United
States of America, payable at time of sale.
(c) Trustee may postpone sale of all or any
portion of the Mining Property by public announcement
at such time and place of sale, and from time to time
thereafter may postpone such sale by public
announcement at the time fixed by the preceding
postponement.
(d) Trustee shall deliver to a purchaser its deed
conveying the property so sold, but without any
covenant or warranty, express or implied. The recitals
in such deed of any matters of facts shall be
conclusive proof of the truthfulness thereof.
(e) Any person, including Trustor, Trustee or any
Beneficiary as herein defined, may purchase at such
sale.
(f) After deducting all costs, fees and expenses
of Trustee and of this Deed of Trust, including cost of
evidence of title and reasonable counsel fees in
connection with sale, Trustee shall apply the proceeds
of sale to payment of all sums expended under the terms
hereof not then repaid with accrued interest at fifteen
percent (15%) per annum, all other sums then secured
hereby and, the remainder, if any, to the persons
entitled thereto.
(g) Notwithstanding anything to the contrary
contained herein, any default by Trustor under any of
the Loan Agreement, this Deed of Trust, any Note, any
Loan Document or any other agreement or document
referred to herein by reference, either specifically or
generally, shall constitute a default under each and
every of the other agreements or documents described
herein.
15. Upon the occurrence of an Event of Default by
Trustor as described herein and after expiration of any period of
time provided for in N.R.S. 107.080(2)(c), upon written demand by
each Beneficiary, Trustor agrees to execute and deliver within
three (3) calendar days, a Deed in Lieu of Foreclosure in a form
acceptable to each Beneficiary.
16. Trustor (as debtor) hereby grants to each
Beneficiary (as creditor and secured party) as security for the
payment of the Notes and all other sums secured by this Deed of
Trust a
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security interest in all of the following described property
presently owned or hereafter acquired wherever the same be
situated relating to or arising from the Mining Property: (i) all
machinery, apparatus, equipment, severed ores and minerals, dore',
slurries, ore stock piles, fittings, fixtures any and all water
rights (including, without limitation, water certificate nos.
52895 and 52896) and articles of personal property of every kind
and nature whatsoever, including consumable goods, now or
hereafter located in or upon the Mining Property or any part
thereof, and used or useable in connection with any present or
future operation of the Mining Property and now owned or
hereafter owned by Trustor or leased by Trustor; together with
all building materials, goods and personal property on or off the
Mining Property intended to be affixed to or incorporated in the
Mining Property but not yet affixed to or incorporated in the
Mining Property and any and all rights to (i) general intangibles
including all accounts now owned or hereafter acquired, wherever
the same be situated; (ii) accounts receivable, contract rights,
general intangibles, rents and profits and any other form of
obligation requiring the payment of money to Trustor, and any
claim by Trustor for any of the foregoing arising from the Mining
Property and improvements now or hereafter located thereon; (iii)
all assignable licenses, permits, registrations, and governmental
approvals; (iv) Leases and Income (as defined below) with respect
to the Mining Property; (v) all accessions, parts, attachments,
and accessories used or intended for use in connection with any
of the foregoing; (vi) proceeds, products, proceeds of hazard
insurance and eminent domain proceedings, and condemnation awards
of all of the foregoing; and (vii) all substitutions,
replacements, repossessions, returns and records of any of the
foregoing.
For the purposes of the foregoing, the following definitions
shall apply:
"Income" shall mean all rents, security or similar deposits,
revenues, issues, royalties, earnings, products or proceeds,
profits, income and other benefits from the Mining Property.
"Leases" shall mean any Lease or agreement, written or oral,
demising any portion of the Mining Property, now or hereafter
existing, and all rights of Trustor thereto or therefrom.
Trustor shall execute any and all such documents, including
without limitation, financing statements pursuant to the Uniform
Commercial Code of the State of Nevada as either Beneficiary may
request, to preserve and maintain the priority of the lien
created hereby on property which may be deemed personal property
or fixtures, and shall pay to such Beneficiary on demand any
expenses incurred by such Beneficiary in connection with the
preparation, execution and filing of documents. Trustor hereby
authorizes and empowers each Beneficiary to execute and file, on
Trustor's behalf, all financing statements and refilings and
continuations thereof as such Beneficiary deems necessary or
advisable to create, preserve and protect said lien. This Deed
of Trust shall be deemed a security agreement as defined in said
Uniform Commercial Code and the remedies for any violation of the
covenants, terms and conditions of the agreements herein
contained shall be cumulative and (i) as prescribed herein, or
(ii) by general law, or (iii) as to such part of the security
which is also reflected in said financing statements by the
specific statutory consequences now or hereafter enacted and
specified in the Uniform Commercial Code, all at either
Beneficiary's sole election.
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Trustor and each Beneficiary agree that the filing of
financing statements in the records normally having to do with
personal property shall never be construed as in anywise
derogating from or impairing the express declaration and
intention of the parties hereto, hereinabove stated, that
everything used in connection with the production of income from
the Mining Property and/or adapted for use therein and/or which
is described or reflected in this Deed of Trust is, and at all
times and for all purposes and in all proceedings both legal or
equitable shall be regarded as part of the real estate encumbered
by this Deed of Trust irrespective of whether (i) any such item
is physically attached to the Improvements, (ii) serial numbers
are used for the better identification of certain equipment items
capable of being thus identified in a recital contained herein or
in any list with any Beneficiary or (iii) any such item is
referred to or reflected in any such financing statement so filed
at any time. Similarly, the mention in any such financing
statement of (1) rights in or to the proceeds of any fire and/or
hazard insurance policy, or (2) any award in eminent domain
proceedings for a taking or for lessening of value or (3)
Trustor's interest as lessor in any present or future lease or
rights to income growing out of the use and/or occupancy of the
property conveyed hereby, whether pursuant to lease or otherwise,
shall never be construed as in anywise altering any of the rights
of either Beneficiary as determined by this instrument or
impugning the priority of either Beneficiary's lien granted
hereby or by any other recorded document, but such mention in a
financing statement is declared to be solely for the protection
of each Beneficiary in the event any court or judge shall at any
time hold with respect to the matters set forth in the foregoing
clauses (1), (2) and (3) that notice of either Beneficiary's
priority of interest to be effective against a particular class
of persons, including but not limited to the federal government
and any subdivisions or entity of the federal government, must be
filed in the Uniform Commercial Code records.
17. This Deed of Trust shall be effective as a
financing statement filed as a fixture filing from the date of
the recording hereof in accordance with NRS 104.9402. In
connection therewith, the addresses of the Trustor as debtor
("Trustor") and each Beneficiary as secured party (each a
"Secured Party") are as set forth on page 1 hereof. The
foregoing address of each Beneficiary, as a Secured Party, is
also the address from which information concerning the security
interest may be obtained by any interested party. Portions of
the property subject to this fixture filing as identified in (a)
above are or are to become fixtures related to the real estate
described on Exhibits A and B to this Deed of Trust.
18. Trustor will, at its expense, execute, deliver,
file and record (in such manner and form as each Beneficiary may
require), or permit each Beneficiary to file and record, any
financing statements, fixture filing, any carbon, photographic or
other reproduction of a financing statement, fixture filing or
this Deed of Trust (which shall be sufficient as a financing
statement and fixture filing hereunder), any specific assignments
or other paper that may be reasonably necessary or desirable, or
that any Beneficiary may request, in order to create, preserve,
perfect or validate any security interest hereunder or to enable
such Beneficiary to exercise and enforce its rights hereunder
with respect to all fixtures included within the Mining Property,
and is to be filed for record in the Office of the County
Recorder of each county where any part of the real property is
situated. Trustor hereby appoints each Beneficiary as Trustor's
attorney-in-fact to execute in the name and behalf of Trustor
such additional financing statements as such Beneficiary may
request. The mailing address of Trustor is set forth on Page l
hereof and the address of each
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Beneficiary from which information concerning the security
interest may be obtained is also set forth on Page 1 hereof.
19. Subject to the provisions of paragraph 21 below,
this Deed of Trust applies to, inures to the benefit of, and
binds all parties hereto, their heirs, legatees, devisees,
administrators, executors, successors and assigns. In this Deed
of Trust whenever the context so requires, the masculine gender
includes the feminine and/or neuter, and the singular number
includes the plural. To the extent that any provisions hereof
conflict with specific provisions of the Loan Agreement, the
provisions of the Loan Agreement shall govern.
20. Each Beneficiary may, from time to time as
provided by statute or by a writing signed and acknowledged by
such Beneficiary and recorded in the Office of the County
Recorder of the county in which the Mining Property or any part
thereof as is then affected by this Deed of Trust is situated,
appoint another Trustee in place and stead of Trustee herein
named, and thereupon, Trustee herein named shall be discharged
and Trustee so appointed shall be substituted as Trustee
hereunder, with the same effect as if originally named Trustee
herein.
21. Trustor shall not sell, assign, convey, mortgage,
pledge, hypothecate or otherwise transfer (i) all or any part of
the Mining Property or (ii) all or any part of Trustor's interest
therein. Any violation or attempted violation of the provisions
of this paragraph 19 shall permit each Beneficiary to declare, at
beneficiary's option and with notice to Trustor, a default
hereunder.
22. EACH OF THE PARTIES WAIVES TRIAL BY JURY IN ANY
ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR IN ANY WAY
CONNECTED WITH THIS DEED OF TRUST OR ANY OF THE TRANSACTIONS
CONTEMPLATED HEREIN.
23. All notices and other communications hereunder
shall be given or made by telex, telegraph, telecopy or in
writing or delivered to the intended recipient at its address set
forth on Page 1 hereof; or, as to any party, at such other
address as shall be designated by such party in a notice to the
other parties. All such communications shall be deemed to have
been duly given when transmitted by telex or telecopy, delivered
to the telegraph office or personally delivered or, in the case
of a mailed notice, upon receipt, in each case given or addressed
as aforesaid.
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IN WITNESS WHEREOF, the undersigned has executed this Deed
of Trust and Assignment of Rents and Royalties, Security
Agreement and financing statement as of the month, day and year
first above written.
"TRUSTOR"
ALTA GOLD CO., a Nevada corporation
By_________________________________
Title______________________________
STATE OF NEVADA )
:ss.
COUNTY OF XXXXX )
This instrument was acknowledged before me on April ___,
1997 by ___________________as __________________ of Alta Gold
Co., a Nevada corporation
___________________________________
(Signature of Notary)
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EXHIBIT A
EXHIBIT B
EXHIBIT C
PERMITTED LIENS
(A)Property described in the following financing statements on
file on date hereof:
COLLATERAL
FILING OFFICE SECURED PARTY FILE NO. FILE DATE DESCRIPTION
Nevada Secretary NERCO Exploration Company 91-10688 11/19/91 Escrow funds
of State
Cargill Leasing 95-08576 06/19/95 Equipment
Corporation (assigned to
Cargill Leasing
Receivables, LLC)
Cargill Leasing 95-12612 09/06/95 Equipment
Corporation (assigned to
Cargill Leasing
Receivables, LLC)
First National Bank of Xxx 96- 3/ /96 Mill and
equipment
Lyon Credit Corp. 96-06852 5/3/96 Equipment
Cargill Leasing 97-02722 2/18/97 Equipment
Receivables, LLC
Concord Commercial 96-09309 6/13/96 Equipment
Xxxxx County Xxxxxx Metals, Inc. Bk 960716 7/16/96 All assets
Recorder (assigned to BHF Bank, Inst 00621
etc.)
Xxxxxx Metals, Inc. Bk 950727 7/16/96 Equipment
Inst 00000
Xxxx Xxxxxx Xxxxxx Metals, Inc. 386760 6/12/96 All assets
Recorder (assigned to BHF Bank Bk 942
Akhiengelsellschaft) Pg 164
Elko County Xxxxxx Metals, Inc. 366877 4/20/95 All assets
Recorder
Washoe County Xxxxxx Metals, Inc. 1887690 9/24/95 All assets
Recorder
White Xxxx Xxxxxx Metals, Inc. Bk 235 4/21/95 All assets
County Recorder Pg 583
(B) Purchase money security interests in property acquired after
the date hereof.
(C) Liens imposed by any governmental authority for taxes,
assessments or charges not yet due.
(D) Liens with respect to the Griffon Mine securing indebtedness
not to exceed Two Million Dollars ($2,000,000) in the
aggregate at any time and incurred in connection with
equipment financing.
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