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EXHIBIT 10.28
RECORDING REQUESTED BY
AND WHEN RECORDED RETURN TO:
THE FROST NATIONAL BANK
P.O. Box 1600
San Antonio, Texas 78296-1400
ATTENTION: Xxx Xxxxxxxx
Loan Department
Location RB-2
APN:
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PARCEL:
LEASEHOLD
DEED OF TRUST, SECURITY AGREEMENT,
ASSIGNMENT OF RENTS AND FIXTURE FILING
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THIS LEASEHOLD DEED OF TRUST, SECURITY AGREEMENT, ASSIGNMENT OF RENTS
AND FIXTURE FILING ("DEED OF TRUST" and/or "MORTGAGE") is made this 15th day of
September, 1997, by SOUTHWESTERN ICE, INC., a Texas corporation ("TRUSTOR"),
whose address is 0000 Xxxx Xxxxxxx, Xxxxx 000, Xxxxxxx, Xxxxx 00000; XXXXX X.
XXXXX, ("TRUSTEE"); whose address is P.O. Box 1600, San Antonio, Texas 78296;
and THE FROST NATIONAL BANK, a national banking association, agent for each of
the banks under the Credit Agreement (as defined below), ("BENEFICIARY") whose
address is P.O. Box 1600, San Antonio, Texas 78296.
ARTICLE 1
CERTAIN DEFINITIONS, GRANTING CLAUSES, SECURED INDEBTEDNESS
1.1 CERTAIN DEFINITIONS AND REFERENCE TERMS. In addition to the
other terms defined herein, each of the following terms shall have the meaning
assigned to it:
"AGENT": The Frost National Bank, a national banking association, in
its capacity as agent for the Banks, and its successors and assigns.
"BANKS": Collectively, each of the financial institutions listed on
the signature pages to the Credit Agreement, together with each other person or
entity becoming a Bank pursuant thereto from time to time, and their respective
successors and assigns.
"BORROWERS": Packaged Ice, Inc., a Texas Corporation.
"TRUSTOR": Southwestern Ice, Inc., a Texas Corporation, and its
successors and assigns.
"CREDIT AGREEMENT": That certain Credit Agreement dated as of the
date hereof, executed by and among Borrowers, the Frost National Bank, as Agent
and as Bank, and certain Banks named therein, as amended, supplemented,
modified, restated or extended from time to time.
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"PROMISSORY NOTES": Each Revolving Credit Note (as such term is
defined in the Credit Agreement) executed by Borrowers jointly and severally
payable to the order of any Bank, evidencing loans advanced to Borrowers under
the Credit Agreement, in an aggregate principal face amount of $20,000,000,
bearing interest as therein provided, containing a provision for the payment of
a reasonable additional amount as attorneys' fees, and finally maturing on
April 15, 2003, together with any renewals, increases, extensions,
restatements, or modifications thereof.
"TRUSTEE": Xxxxx X. Xxxxx, of Bexar County, Texas, or any successor
or substitute appointed and designated as herein provided from time to time
acting hereunder.
1.2 MORTGAGED PROPERTY. Trustor does hereby grant, bargain,
sell, convey, transfer, assign and set over to Trustee the following: The
leasehold estate (herein called the "LAND") created by the Lease Agreement
described in Exhibit "A" attached hereto and incorporated herein by this
reference, and (i) all improvements now or hereafter situated or to be situated
on the Land (hereinafter together called the "IMPROVEMENTS"); and (ii) all
right, title and interest of Trustor in and to (1) all streets, roads, alleys,
easements, rights-of-way, licenses, rights of ingress and egress, vehicle
parking rights and public places, existing or proposed, abutting, adjacent,
used in connection with or pertaining to the Land or the Improvements; (2) any
strips or gores between the Land and abutting or adjacent properties; and (3)
all water, and water rights, timber, crops and mineral interests on or
pertaining to the Land or the Improvements (the Land, Improvements and other
rights, titles and interests referred to in this clause (a) being herein
sometimes collectively called the "PREMISES"); (b) all fixtures, equipment,
systems, machinery, furniture, furnishings, appliances, inventory, goods,
building and construction materials, supplies, and articles of personal
property, of every kind and in, on or about the Land or the Improvements, or
used in or necessary to the complete and proper planning, development, use,
occupancy or operation thereof, or acquired (whether delivered to the Land or
stored elsewhere) for use or installation in or on the Land or the
Improvements, and all renewals and replacements of substitutions for and
additions to the foregoing (the properties referred to in this clause (b) being
herein sometimes collectively called the "ACCESSORIES", all of which are hereby
declared to be permanent accessions to the Land); (c) all (i) plans and
specifications for the Improvements; (ii) Trustor's rights, but not liability
for any breach by Trustor, under all commitments (including any commitment for
financing to pay any of the secured indebtedness, as defined below), insurance
policies and other contracts and general intangibles (including, but not
limited to trademarks, trade names and symbols) related to the Premises or
tenants' security deposits, deposits with respect to utility services to the
Premises, and any deposits or reserves hereunder or under any other Loan
Document, taxes, insurance or otherwise), money, accounts, instruments,
documents, notes and chattel paper arising from or by virtue of any
transactions related to the Premises or Accessories (without derogation of
ARTICLE 3 hereof); (iv) permits, licenses, franchises, certificates,
development rights, commitments and rights for utilities, and other rights and
privileges obtained in connection with the Premises or the Accessories; (v)
leases, rents, royalties, bonuses, issues, profits, revenues and other benefits
of the Premises and the Accessories (without derogation of ARTICLE 3 hereof,
and herein sometimes collectively called the "RENTS AND PROFITS"); (vi) oil,
gas and other hydrocarbons and other minerals produced from or allocated to the
Land and all products processed or obtained therefrom, and the proceeds
thereof; and (vi) engineering, accounting, title, legal and other technical or
business data concerning the Mortgaged Property which are in the possession of
Trustor or in which Trustor can otherwise grant a security interest; and (d)
all (i) proceeds of or arising from the properties, rights, titles and
interests referred to above in this SECTION 1.2, including, but not limited to
proceeds of any sale, lease or other disposition thereof, proceeds of each
policy of insurance relating thereto (including premium refunds), proceeds of
the taking thereof or of any rights appurtenant thereto, including change of
grade of streets, curb cuts or other rights of access, by eminent domain or
transfer in
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lieu thereof for public or quasi-public use under any law, and proceeds arising
out of any damage thereto; and (ii) other interest of every kind and character
which Trustor now has or hereafter acquires in, or to or for the benefit of the
properties, rights, titles and interests referred to above in this SECTION 1.2
and all property used or useful in connection therewith, including, but not
limited to rights of ingress and egress and remainders, reversions and
reversionary rights or interests; and if the estate of Trustor in any of the
property referred to above in this SECTION 1.2 is leasehold estate, this
conveyance shall include, and the lien and security interest created hereby
shall encumber and extend to, all other or additional title, estates, interests
or rights which are now owned or may hereafter be acquired by Trustor in or to
the property demised under the lease creating the leasehold estate; TO HAVE AND
TO HOLD the foregoing rights, interests and properties, and all rights,
estates, powers and privileges appurtenant thereto (herein collectively called
the "MORTGAGED PROPERTY" or "PROPERTY"), unto Trustee, and to his successors or
substitutes in this trust, and to his or their successors and assigns, in
trust, however, upon the terms, provisions and conditions herein set forth.
1.3 SECURITY INTEREST. Trustor hereby grants to Agent, as agent for
the Banks, a security interest in all of the Mortgaged Property which
constitutes personal property or fixtures (herein sometimes collectively called
the "COLLATERAL"). In addition to its rights hereunder or otherwise, Agent
shall have all of the rights of a secured party under the Texas Business Code,
or under the Uniform Commercial Code in force in any other state to the extent
the same is applicable law.
1.4 NOTES, LOAN DOCUMENTS, OTHER OBLIGATIONS. This Mortgage is made
to secure and enforce the payment and performance of the following promissory
notes, obligations, indebtedness and liabilities and all renewals, extensions,
supplements, increases, and modifications thereof in whole or in part from time
to time:
(i) the Promissory Notes and all other notes given in
substitution therefor or in modification, supplement, increase, renewal or
extension thereof, in whole or in part (such notes, as from time to time
renewed, extended, supplemented, increased, or modified and all other notes
given in substitution therefor, or in modification, renewal or extension
thereof, in whole or in part, being hereinafter collectively called the
"NOTES," and individually a "NOTE," and Agent and the other Banks, or the
subsequent holders at the time in question of the Notes or any of the secured
indebtedness, as hereinafter defined, being collectively herein called
"HOLDERS" and individually a "HOLDER"); (ii) all indebtedness and other
obligations owed by any of the Borrowers (or all of them) to any Holder now or
hereafter incurred or arising pursuant to or permitted by the provisions of the
Notes, this Mortgage, or any other document now or hereafter evidencing,
governing, guaranteeing, securing, or otherwise executed in connection with the
loans evidenced by the Notes, including, but not limited to any loan or credit
agreement, tri-party financing agreement or other agreement between any of the
Borrowers (or all of them) and Holders, or among any of the Borrowers or all of
them), Holders and any other party or parties, pertaining to the repayment or
use of the proceeds of the loan evidenced by the Notes (the Credit Agreement,
the Notes, this Mortgage, any other "Loan Papers" (as such term is defined in
the Credit Agreement), and such other documents as they or any of them may have
been or may be from time to time renewed, extended, supplemented, increased or
modified, being herein sometimes collectively called the "LOAN DOCUMENTS").
The indebtedness referred to in this SECTION 1.4 is hereinafter
sometimes referred to as the "SECURED INDEBTEDNESS" or the "INDEBTEDNESS
SECURED HEREBY" or the "INDEBTEDNESS."
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ARTICLE 2
REPRESENTATIONS, WARRANTIES
AND COVENANTS OF TRUSTOR
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2.1 WARRANTIES OF TRUSTOR. Trustor, for itself and its successors
and assigns, does hereby represent, warrant and covenant to and with
Beneficiary, its successors and assigns, that:
(a) Trustor has full power and lawful authority to grant,
assign, transfer and mortgage its interest in the Property in the manner and
form hereby done. Trustor shall preserve its interest in and to the Property
and shall forever warrant and defend the same to Trustee and shall forever
warrant and defend the validity and priority of the lien hereof against the
claims of all persons and parties whomsoever. Trustor shall promptly and
completely observe, perform and discharge each and every obligation, covenant,
condition, restriction and agreement applicable to Trustor and affecting the
Property, whether the same is prior and superior or subject and subordinate
hereto. (The foregoing warranty of title shall survive the foreclosure of this
Deed of Trust and shall inure to the benefit of and be enforceable by any
person who may acquire title to the Property pursuant to any foreclosure.);
(b) No bankruptcy or insolvency proceedings are pending
or contemplated by Trustor or, to Trustor's knowledge, against Trustor or by or
against any endorser, cosigner or guarantor of the Promissory Notes;
(c) The execution and delivery of this Deed of Trust, the
Note and all of the other Loan Documents do not contravene, result in a breach
of or constitute a default under any contract or agreement to which Trustor is
a party or by which Trustor or any of its properties may be bound and, to the
best of Trustor's knowledge, do not violate or contravene any law, order,
decree, rule or regulation to which Trustor is subject;
(d) Trustor has not entered into any other contract,
agreement or commitment which would materially impair Trustor's ability to
perform the covenants and obligations required to be performed by it under the
Loan Documents.
(e) There are no judicial or administrative actions,
suits or proceedings pending or, to the best of Trustor's knowledge, threatened
against or affecting Trustor or the Property that would materially impair
either the Property or Trustor's ability to perform the covenants or
obligations required to be performed under the Loan Documents;
(f) All reports, certificates, affidavits, statements and
other data furnished by Trustor to Beneficiary in connection with the loan
evidenced by the Promissory Notes are true and correct in all material respects
and do not omit to state any material fact or circumstance necessary to make
the statements contained therein not misleading;
(g) All financial statements furnished by Trustor to
Beneficiary in connection with the loan evidenced by the Note fairly present
the financial condition of the Trustor as at the date specified therein, and
since said date, there has been no material adverse change in the financial
condition, property or business of Trustor.
(h) To the best of Trustor's knowledge, the Property and
the intended use thereof by Trustor complies in all material respects with all
applicable restrictive covenants, zoning ordinances, subdivision and building
codes, flood disaster laws, applicable health and environmental laws and
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regulations, and all other statutes laws, ordinances, orders and requirements
issued by state, federal or municipal authorities having or claiming
jurisdiction over the Property;
(i) The Property is free from damage caused by fire,
earthquake, flood or other casualty;
(j) No part of the Property has been taken in
condemnation, eminent domain or similar proceedings nor are any such
proceedings pending or, to the best of Trustor's knowledge, threatened;
(k) Trustor is a corporation, duly authorized to do
business, and in good standing under the laws of the State of Texas;
(l) Trustor has the power and authority to own its
properties and assets and to carry on its business as it is currently being
conducted, including the power and authority to enter into this Deed of Trust
and all of the other Loan Documents;
(m) The person signing this Deed of Trust on behalf of
Trustor is the Trustor.
The representations and warranties set forth in this SECTION 2.1 are
made for the benefit of Beneficiary, and its participants, successors and
assigns, and shall not inure to the benefit of (nor may they be enforced by)
any purchaser of the Property at any foreclosure sale or any transferee of the
Property by deed in lieu of foreclosure (other than Beneficiary itself).
If there is any conflict between the provisions of this SECTION 2.1
and the representations and warranties specified in the Credit Agreement, the
representations and warranties in the Credit Agreement shall control.
2.2 DEFENSE OF TITLE. Without limiting or waiving any other
rights and remedies of Beneficiary hereunder, if, while this Deed of Trust is
in force, the title to the Property described herein or the interest of
Beneficiary therein shall be in the subject, directly or indirectly, of any
action at law or in equity or be attached directly or indirectly, or
endangered, clouded or adversely affected in any manner, Trustor shall,
immediately upon receipt of written notice from Beneficiary, take all
reasonably necessary and proper steps for the defense of said title or
interest, including the employment of counsel, the prosecution or defense of
litigation, and the compromise or discharge of claims made against said title
or interest. If Trustor fails to so defend such title or interest to the
reasonable satisfaction of Beneficiary, Trustor hereby authorizes Beneficiary,
at Trustor's expense, to take all reasonably necessary and proper steps to
defend such title or interest.
2.3 PERFORMANCE OF OBLIGATIONS. Trustor shall pay when due the
principal of and the interest on the Indebtedness secured hereby and all
charges, fees and other sums as provided in the Loan Documents, and shall
observe, perform and discharge all obligations, covenants and agreements that
are secured by this Deed of Trust in accordance with their terms. Further,
Trustor shall promptly and strictly perform and comply with all covenants,
conditions, obligations and prohibitions required of Trustor in connection with
any other encumbrance affecting the Property, or any part thereof, regardless
of whether such encumbrance is superior or subordinate to the lien hereof.
2.4 INSURANCE. Trustor shall obtain and maintain at Trustor's
sole expense: (1) all risk insurance with respect to all insurable Mortgaged
Property, against loss or damage by fire, lightning,
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windstorm, explosion, hail, tornado and such hazards as are presently included
in so-called "all risk" coverage and against such other insurable hazards as
Agent may require, in an amount not less than 100% of the full replacement
cost, including the cost of debris removal, without deduction for depreciation
and sufficient to prevent Trustor and Agent from becoming a coinsurer, such
insurance to be in Builder's Risk (non-reporting) form during and with respect
to any construction on the Premises; (2) if and to the extent any portion of
the Property is in a special flood hazard area, a flood insurance policy in an
amount equal to the lesser of the principal face amount of the Notes or the
maximum amount available; (3) commercial general public liability insurance, on
an "occurrence" basis, for the benefit of Trustor and Agent as named insureds;
(4) statutory workers' compensation insurance with respect to any work on or
about the Property; and (5) such other insurance on the Mortgaged Property as
may from time to time be reasonably required by Agent (including, but not
limited to business interruption insurance, boiler and machinery insurance,
earthquake insurance, and war risk insurance) and against other insurable
hazards or casualties which at the time are commonly insured against in the
case of premises similarly situated, due regard being given to the height,
type, construction, location, use and occupancy of buildings and improvements.
All insurance policies shall be issued and maintained by insurers, in amounts
with deductibles, and in form satisfactory to Agent, and shall require not less
than thirty (30) days' prior written notice to Agent of any cancellation or
change of coverage. All insurance policies maintained, or caused to be
maintained, by Trustor with respect to the Mortgaged Property, except for
public liability insurance, shall provide that each such policy shall be
primary without right of contribution from any other insurance that may be
carried by Trustor or Agent and that all of the provisions thereof, except the
limits of liability, shall operate in the same manner as if there were a
separate policy covering each insured. If any insurer which has issued a
policy of title, hazard, liability or other insurance required pursuant to this
Mortgage or any other Loan document becomes insolvent or the subject of any
bankruptcy, receivership or similar proceeding or if in the Agent's reasonable
opinion the financial responsibility of such insurer is or becomes inadequate,
Trustor shall, in each instance promptly upon the request of Agent and at
Trustor's expense, obtain and deliver to Agent a like policy (or, if and to the
extent permitted by Agent, a certificate of insurance), issued by another
insurer, which insurer and policy meet the requirements of this Mortgage or
such other Loan Document, as the case may be. Without limiting the discretion
of Agent with respect to required endorsements to insurance policies, all such
policies for loss or damage to the Mortgaged Property shall contain a standard
mortgage clause (without contribution) naming Agent, as agent for the Banks, as
mortgagee with loss proceeds payable to Agent notwithstanding (i) any act,
failure in act or negligence of or violation of any warranty, declaration or
condition contained in any such policy by any named insured; (ii) the
occupation or use of the Mortgaged Property for purposes more hazardous than
permitted by the terms of any such policy; (iii) any foreclosure or other
action by Agent under the Loan Documents; or (iv) any change in title to or
ownership of the Mortgaged Property or any portion thereof, such proceeds to be
held for application as provided in the Loan Documents. The originals of each
initial insurance policy (or to the extent permitted by Agent, a copy of the
original policy and a satisfactory certificate of insurance) shall be delivered
to Agent at the time of execution of this Mortgage, with premiums fully paid,
and each renewal or substitute policy (or certificate) shall be delivered to
Agent, with premiums fully paid, at least ten (10) days before the termination
of the policy it renews or replaces. Trustor shall pay all premiums on
policies required hereunder as they become due and payable and promptly deliver
to agent evidence satisfactory to Agent of the timely payment thereof. If any
loss occurs at any time when Trustor has failed to perform Trustor's covenants
and agreements in this paragraph, Agent shall nevertheless be entitled to the
benefit of all insurance covering the loss and held by or for Trustor, to the
same extent as if it had been made payable to Agent. Upon any foreclosure
hereof or transfer of title to the Mortgaged Property in extinguishment of the
whole or any part of the secured indebtedness, all of Trustor's right, title
and interest in and to the insurance policies referred to in this Section
(including unearned premiums) and all proceeds payable thereunder shall
thereupon vest in the purchaser at foreclosure or
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other such transferee, to the extent permissible under such policies. Agent
shall have the right (but not the obligation) to make proof of loss for, settle
and adjust any claim under, and receive the proceeds of, all insurance for loss
or damage to the Mortgaged Property, and the expenses incurred by Agent in the
adjustment and collection of insurance proceeds shall be a part of the secured
indebtedness and shall be due and payable to Agent on demand. Agent shall not
be, under any circumstances, liable or responsible for the obtaining,
maintaining or adequacy of any insurance or for failure to collect or exercise
diligence in the collection of any of such proceeds or for failure to see to
the proper application of any amount paid over to Trustor. Any such proceeds
received by Agent shall, after deduction therefrom of all reasonable expenses
actually incurred by Agent, including attorneys' fees, at Agent's option be (1)
released to Trustor, or (2) applied (upon compliance with such terms and
conditions as may be required by Agent) to repair or restoration, either partly
or entirely, of the Mortgaged Property so damaged, or (3) applied to the
payment of the secured indebtedness in such order and manner as Agent, in its
sole discretion, may elect, whether or not due. Trustor shall at all times
comply with the requirements of the insurance policies required hereunder and
of the issues of such policies and of any board of fire underwriters or similar
body as applicable to or affecting the Mortgaged Property.
2.5 PAYMENT OF TAXES. Trustor shall pay or cause to be paid,
except to the extent provision is actually made therefor pursuant to SECTION
2.6 of this Deed of Trust, all taxes and assessments that are or may become a
lien on the Property or that are assessed against or imposed upon the Property.
Trustor shall furnish Beneficiary with receipts showing payment of such taxes
and assessments prior to the applicable delinquency date therefor, except that
Trustor may in good faith, by appropriate proceedings, contest, so long as such
contest is diligently pursued, the validity, applicability or amount of any
asserted tax or assessment; and pending such contest, Trustor shall not be
deemed in default hereunder by reason of nonpayment of such asserted tax or
assessment if Beneficiary determines, in its reasonable opinion, that
nonpayment of such tax or assessment shall not result in the loss, forfeiture
or diminution of the Property or any part thereof or any interest of
Beneficiary therein and if, prior to delinquency of the asserted tax or
assessment, Trustor establishes an escrow acceptable to Beneficiary adequate to
cover the payment of such tax or assessment and a reasonable additional sum to
cover possible interest, cost and penalties (which escrow shall be returned to
Trustor upon payment of all such taxes, assessments, interest, costs and
penalties or upon a final determination that such taxes are not, in fact,
payable), and if Trustor promptly causes to be paid any amount adjudged by a
court of competent jurisdiction to be due, with all interest, costs and
penalties thereon, promptly after such judgment becomes final; provided,
however, that in any event each such contest shall be concluded and the taxes,
assessments, interests, costs and penalties shall be paid, prior to the date
any writ or order is issued under which the Property may be sold. Trustor
shall have the right to require that any such escrow established with
Beneficiary be applied to the payment of any such taxes, assessments, interest,
costs and penalties. In the event Trustor fails to pay any installment of real
property taxes prior to delinquency and has not made other, adequate
arrangements with Beneficiary, Beneficiary may at any time thereafter (subject
to notice and cure provisions set forth in SECTION 3.1(B) hereof), but shall
not be obligated to, pay such delinquent taxes, interest and penalties and
Trustor shall pay all sums to Beneficiary promptly upon demand by Beneficiary
together with interest thereon from the date(s) advanced by Beneficiary at the
Default Rate defined in the Note; any such sums advanced by Beneficiary for the
payment of taxes and penalties, together with such interest thereon, shall be
secured by this Deed of Trust.
2.6 RESERVE FOR INSURANCE, TAXES AND ASSESSMENTS. Upon the
occurrence and continuance of an Event of Default and upon written request of
Agent, to secure certain of Trustor's obligations in paragraphs 2.4 and 2.5
above, but not in lieu of such obligations, Trustor will deposit with Agent a
sum equal to ad valorem taxes, assessments and charges (which charges for the
purpose of this paragraph shall include without limitation any recurring charge
which could result in a lien against the
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Mortgaged Property) against the Mortgaged Property for the current year and the
premiums for such policies of insurance for the current year, all as estimated
by Agent and prorated to the end of the calendar month following the month
during which Agent's request is made, and thereafter will deposit with Agent,
on each date when an installment of principal and/or interest is due on the
Notes, sufficient funds (as estimated from time to time by Agent) to permit
Agent to pay at least fifteen (15) days prior to the due date thereof, the next
maturing ad valorem taxes, assessments and charges and premiums for such
policies of insurance. Agent shall have the right to rely upon tax information
furnished by applicable taxing authorities in the payment of such taxes or
assessments and shall have no obligation to make any protest of any such taxes
or assessments. Any excess over the amounts required for such purposes shall
be held by Agent for future use, applied to any secured indebtedness or
refunded to Trustor, at Agent's option, and any deficiency in such funds so
deposited shall be made up by Trustor upon demand of Agent. All such funds so
deposited shall bear no interest, may be mingled with the general funds of
Agent and shall be applied by Agent toward the payment of such taxes,
assessments, charges and premiums when statements therefor are presented to
Agent by Trustor (which statements, shall be presented by Trustor to Agent a
reasonable time before the applicable amount is due); provided, however, that
if a default shall have occurred hereunder, such funds may at Agent's option be
applied to the payment of the secured indebtedness in the order determined by
Agent in its sole discretion, and Agent may (but shall have no obligation) at
any time, in its discretion, apply all or any part of such funds toward the
payment of any such taxes, assessments, charges or premiums which are past due,
together with any penalties or late charges with respect thereto. The
conveyance or transfer of Trustor's interest in the Mortgaged Property for any
reason (including without limitation the foreclosure of a subordinate lien or
security interest or a transfer by operation of law) shall constitute an
assignment or transfer of Trustor's interest in and rights to such funds held
by Agent under this paragraph but subject to the rights of Agent hereunder.
2.7 CONDEMNATION. Trustor shall notify Agent immediately after
Trustor becomes aware of any threatened or pending proceeding for condemnation
affecting the Mortgaged Property or arising out of damage to the Mortgaged
Property, and Trustor shall, at Trustor's expense, diligently prosecute any
such proceedings. Agent shall have the right (but not the obligation) to
participate in any such proceeding, and to be represented by counsel of its own
choice. Agent shall be entitled to receive all sums which may be awarded or
become payable to Trustor for the condemnation of the Mortgaged Property, or
any part thereof, for public or quasi-public use, or by virtue of private sale
in lieu thereof, and any such which may be awarded or become payable to Trustor
for injury or damage to the Mortgaged Property, provided it is applied to the
secured indebtedness. Trustor shall, promptly upon request of Agent, execute
such additional assignments and other documents as may be necessary from time
to time to permit such participation and to enable Agent to collect and receipt
for any such sums. All such sums are hereby assigned to Agent, and shall,
after deduction therefrom of all reasonable expenses actually incurred by
Agent, including reasonable attorneys' fees, at Agent's option (1) released to
Trustor, or (2) applied (upon compliance with such terms and conditions as may
be required by Agent) to repair or restoration of the Mortgaged Property so
affected, or (3) applied to the payment of the secured indebtedness in such
order and manner as Agent, in its sole discretion, may elect, whether or not
due. Agent shall not be, under any circumstances, liable or responsible for
failure to collect or to exercise diligence in the collection of any
circumstances, liable or responsible for failure to collect or to exercise
diligence in the collection of any such sum or for failure to see to the proper
application of any amount paid over to Trustor. Agent is xxxxxx authorized, in
the name of Trustor, to execute and deliver valid acquittances for, and to
appeal from any such award, judgment or decree. All reasonable costs and
expenses (including but not limited to reasonable attorneys fees) incurred by
Agent in connection with any condemnation shall be a demand obligation owing by
Trustor (which Trustor hereby promises to pay) to Agent pursuant to this
Mortgage.
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2.8 MECHANICS' LIENS AND UTILITIES. Trustor shall pay when due
all claims and demands of mechanics, materialmen, laborers and others for any
work performed or materials delivered for the Property; provided, however, that
Trustor shall have the right to contest in good faith any such claim or demand,
provided that it does so diligently and without prejudice to Beneficiary. In
the event Trustor shall contest any such claim or demand, Trustor shall, upon
Beneficiary's written request, promptly provide a bond, cash deposit or other
security reasonably satisfactory to Beneficiary to protect Beneficiary's
interest and security should the contest be unsuccessful. If Trustor shall
fail to immediately discharge or provide security against any such claim or
demand as aforesaid, subject to the notice and cure provisions set forth in
SECTION 3.1(B) hereof, Beneficiary may do so, and any and all expenses incurred
by Beneficiary together with interest thereon at the Default Rate as defined in
the Promissory Notes shall be immediately reimbursed by Trustor on written
demand. Trustor shall pay when due all utility charges that are incurred by
Trustor or that may become a charge or lien against the Property for gas,
electricity, water and sewer services furnished to the Property and all other
assessments or charges of a similar nature, whether public or private,
affecting the Property or any portion thereof, whether or not such taxes,
assessments or charges are or may become liens thereon.
2.9 RENTS AND PROFITS. As additional and collateral security for
the payment of the Indebtedness secured hereby and cumulative of any and all
rights and remedies herein provided for, Trustor hereby absolutely and
currently assigns to Beneficiary all existing and future Rents and Profits and,
with respect to said existing and future Rents and Profits, Trustor hereby
grants to Beneficiary the sole, exclusive and immediate right to demand,
collect (by suit or otherwise), receive and give valid and sufficient receipts
for any and all of said Xxxxx and Profits, for which purpose Trustor does
hereby irrevocably make, constitute and appoint Beneficiary its
attorney-in-fact with full power to appoint substitutes or a trustee to
accomplish such purpose (which power of attorney shall be irrevocable, shall be
deemed to be coupled with an interest, shall survive the voluntary or
involuntary dissolution of Trustor) it being understood that Beneficiary shall
be without liability for any loss that may arise from uncollectible Rents and
Profits, proceeds or other payments so long as Beneficiary shall act on the
Property with ordinary prudence. Trustor irrevocably consents that the
respective payors of the Rents and Profits shall, upon demand and notice from
Beneficiary of Trustor's default hereunder, pay said Xxxxx and Profits to
Beneficiary without liability to such payor for the determination of the actual
existence of any default claimed by Beneficiary. However, until the occurrence
of an Event of Default under this Deed of Trust, Trustor shall have a license
to collect and receive the Rents and Profits. Upon the occurrence of an Event
of Default hereunder, Trustor's license shall automatically terminate without
notice to Trustor and Beneficiary may thereafter, without taking possession of
the Property, collect the Rents and Profits itself or by an agent or receiver.
From and after such termination, Trustor shall be the agent of Beneficiary in
collection of the Rents and Profits and all of the Rents and Profits so
collected by Trustor shall be held in trust by Trustor for the sole and
exclusive benefit of Beneficiary, and Trustor shall, promptly after receipt of
any Rents and Profits, pay the same to Beneficiary to be applied by Beneficiary
as hereinafter set forth. Beneficiary is obligated to account only for such
Rents and Profits as are actually collected or received by Beneficiary.
Possession by a court-appointed receiver shall not be considered possession by
Beneficiary. All Rents and Profits collected by Beneficiary or a receiver
shall be applied first to pay all reasonable expenses of collection, and then
to the payment of all reasonable costs of operation and management of the
Property, and then to the payment of the Indebtedness and obligations secured
hereby in whatever order Beneficiary directs in its absolute discretion and
without regard to the adequacy of its security. In the event that Trustor has
executed a separate Assignment of Rents and Leases concurrently herewith in
favor of Beneficiary covering all of the right, title and interest of Trustor,
as landlord, lessor or licensor, in and to any leases, licenses and occupancy
agreements relating to all or portions of the Property, all rights and remedies
granted to Beneficiary under such Assignment of Rents and Leases shall be in
addition to and cumulative of all rights and remedies granted to
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Beneficiary under this SECTION 2.9.
2.10 LEASES AND LICENSES.
(a) Trustor shall furnish to Beneficiary, within ten (10)
days after a written request by Beneficiary to do so, but not more frequently
than semi-annually, a written statement containing the names of all tenants,
lessees and licensees of the Property, the terms of their respective leases,
licenses or occupancy agreements, the spaces occupied and the rentals or fees
payable thereunder and a copy of each such lease, license and occupancy
agreement.
(b) Upon the occurrence of an Event of Default hereunder,
whether before or after the whole principal sum secured hereby is declared to
be immediately due or whether before or after the institution of legal
proceedings to foreclose this Deed of Trust, forthwith, upon demand of
Beneficiary, Trustor shall surrender to Beneficiary and Beneficiary shall be
entitled to take actual possession of the Property or any part thereof
personally, or by its agent or attorneys. Beneficiary shall have, and Trustor
hereby gives and grants to Beneficiary, the right, power and authority to make
and enter into leases of the Property or portions thereof for such rents and
for such periods of occupancy and upon conditions and provisions as Beneficiary
may deem desirable, and Trustor expressly acknowledges and agrees that the term
of any such lease may extend beyond the date of any foreclosure sale of the
Property; it being the intention of Trustor that in such event, Beneficiary
shall be deemed to be and shall be the attorney-in-fact of Trustor for the
purpose of making and entering into leases of parts or portions of the Property
for the rents and upon the terms, conditions and provisions deemed desirable to
Beneficiary and with like effect as if such leases had been made by Trustor as
the owner in fee simple of the Property free and clear of any conditions or
limitations established by this Deed of Trust. The power and authority hereby
given and granted by Trustor to Beneficiary shall be deemed to be coupled with
an interest and shall not be revocable by Trustor. In connection with any
action taken by Beneficiary pursuant to this SECTION 2.10(B), Beneficiary shall
not be liable for any loss sustained by Trustor resulting from any failure to
let the Property, or any part thereof, or from any other act or omission of
Beneficiary in managing the Property unless such loss is caused by the gross
negligence or willful misconduct of Beneficiary, nor shall Beneficiary be
obligated to perform or discharge any obligation, duty or liability under any
lease or tenancy agreement covering the Property or any part thereof or under
or by reason of this instrument or the exercise of rights or remedies
hereunder. Trustor shall, and does hereby, agree to indemnify Beneficiary for,
and to hold Beneficiary harmless from, any and all liabilities, loss or damage
(including, without limitation, attorneys' fees and costs) that may or might be
incurred by Beneficiary under any such lease or tenancy agreement or under this
Deed of Trust or by the exercise of rights or remedies hereunder and from any
and all claims and demands whatsoever that may be asserted against Beneficiary
by reason of any alleged obligations or undertakings on its part to perform or
discharge any of the terms, covenants or agreements contained in any such lease
agreement, except for acts of gross negligence or willful misconduct by
Beneficiary. Should Beneficiary incur any such liability, the amount thereof,
including, without limitation, reasonable costs, expenses and attorneys' fees,
together with interest thereon at the Default Rate defined in the Note, shall
be secured hereby and shall be a demand obligation hereunder. Nothing in this
SECTION 2.10(B) shall impose any duty, obligation or responsibility upon
Beneficiary for the control, care, management or repair of the Property, or for
the carrying out of any of the terms and conditions of any such lease
agreement, nor shall it operate to make Beneficiary responsible or liable for
any waste committed on the Property by the tenants or by any other parties or
for any dangerous or defective condition of the Property, or for any negligence
in the management, upkeep, repair or control of the Property resulting in loss
or injury or death to any tenant, licensee,
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employee or stranger, except during the period of Beneficiary's actual
possession and operation of the Property pursuant hereto.
2.11 ALIENATION AND FURTHER ENCUMBRANCES. In the event Trustor
shall sell, convey, transfer, dispose of, alienate, or lease for a period of
greater than thirty five (35) years the Property, or any part thereof or any
interest therein, or shall be divested of its title or any interest therein, in
any manner or way, whether voluntarily or involuntarily (any of the foregoing
being individually called a "TRANSFER"), without the written consent of
Beneficiary being first obtained, which consent may not be unreasonably
withheld, Beneficiary shall have the right at its option to declare any
Indebtedness or obligation secured hereby, irrespective of the maturity date
specified in any note evidencing the same, immediately due and payable unless
said transfer is permitted under the Credit Agreement. Acceptance by
Beneficiary of any payment or payments on the Promissory Notes or other sums
secured by this Deed of Trust by one other than Trustor shall not constitute
(i) any notice to Beneficiary of any Transfer or proposed Transfer of any
interest in the Property covered by this Deed of Trust or (ii) any consent or
waiver of the right to consent to such Transfer or proposed Transfer of any
interest in the Property.
2.12 ACCESS PRIVILEGES AND INSPECTIONS. Representatives of
Beneficiary shall have full and free access to the Property at all reasonable
times, upon reasonable prior written notice to Trustor, for the purposes of
inspecting the Property and determining compliance with the terms and
conditions of this Deed of Trust and the other Loan Documents.
2.13 WASTE. Trustor shall not commit, suffer or permit any waste
on the Property nor take any actions that might invalidate any insurance
carried on the Property. Trustor shall maintain the Property in good condition
and repair. No Improvements may be removed or demolished without the prior
written consent of Beneficiary unless otherwise permitted by the Credit
Agreement. No personal property in which Beneficiary has a security interest
may be removed from the Property unless it is immediately replaced by similar
property of at least equivalent value in which Beneficiary shall immediately
have a valid first lien and security interest unless otherwise permitted by the
Credit Agreement.
2.14 ZONING. Without the prior written consent of Beneficiary,
which consent will not be unreasonably withheld or delayed, Trustor shall not
seek, make, suffer or consent to or acquiesce in any change in the zoning or
conditions of use of the Property. Trustor shall comply with and make all
payments required under the provisions of any covenants, conditions or
restrictions affecting the Property. Trustor shall comply with all existing
and future requirements of all governmental authorities having jurisdiction
over the Property.
2.15 BOOKS AND RECORDS. Trustor shall keep accurate books and
records of account of the Property and of its own financial affairs sufficient
to permit the preparation of financial statements therefrom in accordance with
generally accepted accounting principles, consistently applied. Beneficiary
and its duly authorized representatives at all reasonable times shall have full
access to and shall have the right to examine, copy and audit Trustor's records
and books of account relating to the Property and Trustor's financial
condition. So long as this Deed of Trust continues in effect, Trustor shall
provide Beneficiary with financial information as required by the Credit
Agreement. Trustor shall also provide to Beneficiary such additional financial
and other information as may be reasonably requested by Beneficiary.
2.16 FURTHER DOCUMENTATION. Trustor shall, on the request of
Beneficiary promptly (a) correct any defect, error or omission that may be
discovered in the contents of this Deed of Trust or in
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the contents of any of the other Loan Documents; (b) execute, acknowledge,
deliver and record or file such further instruments (including, without
limitation, further deeds of trust, security agreements, financing statements,
continuation statements and assignments of rents or leases) and do such further
acts as may be reasonably necessary, desirable or proper to carry out more
effectively the purposes of this Deed of Trust and the other Loan Documents and
to subject to the liens and security interest hereof and thereof any property
intended by the terms hereof and thereof to be covered hereby and thereby,
including specifically, but without limitation, any renewals, additions,
substitutions, replacements or appurtenances to the Property; (c) execute,
acknowledge, deliver, procure and record or file any document or instrument
(including specifically any financing statement) deemed advisable by
Beneficiary to protect the lien or the security interest hereunder against the
rights or interests of third persons; and (d) furnish to Beneficiary, upon
Beneficiary's request, a duly acknowledged written statement setting forth all
amounts due on the Indebtedness secured by this Deed of Trust and stating
whether any offsets or defenses exist, and containing such other matters as
Beneficiary may reasonably require.
2.17 REIMBURSEMENT TO BENEFICIARY. Trustor shall promptly notify
Beneficiary in writing of any litigation or threatened (in writing) litigation
affecting the Property, or any other written demand or claim which, if
enforced, could materially impair or threaten to impair Beneficiary's security
hereunder. Without limiting or waiving any other rights and remedies of
Beneficiary hereunder, if Trustor fails to perform any of its covenants or
agreements contained in this Deed of Trust, or if any action or proceeding of
any kind (including, but not limited to, any bankruptcy, insolvency,
arrangement, reorganization or other debtor relief proceeding) is commenced
that might materially affect Beneficiary's or Trustee's interest in the
Property or Beneficiary's right to enforce its security, or any claims or
demands for damages or injury, including claims for property damage, personal
injury or wrongful death, arising out of or in connection with any accident or
fire or other casualty on the Property and/or any Improvements thereon or any
nuisance made or suffered thereon, then Beneficiary and/or Trustee may, at
their option (subject to the notice and cure provisions provided in SECTION
3.1(B) hereof, make any appearances, disburse any sums and take any actions as
may be reasonably necessary or desirable to protect or enforce the security of
this Deed of Trust or to remedy the failure of Trustor to perform its covenants
(without, however, waiving any default of Trustor). Trustor agrees to pay all
reasonable out-of-pocket expenses of Beneficiary and Trustee thus incurred
(including, but not limited to, attorneys' fees and costs), together with
interest thereon at the Default Rate defined in the Note from and after the
date of Beneficiary's or Trustee's making such payment until reimbursement
thereof by Trustor. Any sums disbursed by Beneficiary or Trustee, together
with interest thereon, shall be additional Indebtedness of Trustor secured
hereby and shall be payable upon written demand. This SECTION 2.17 shall not
be construed to require Beneficiary or Trustee to incur any expenses, make any
appearances or take any actions.
2.18 PERSONAL PROPERTY AND FIXTURES. This Deed of Trust is also
intended to and does hereby encumber and create a security interest in: (a)
all right, title and interest of Trustor in and to all instruments, documents,
contracts, general intangibles (including trademarks, trade names and symbols
used in connection with the Improvements or the Land), now existing or
hereafter arising from or by virtue of any transaction related to the
Improvements or the Land, permits, licenses, franchises, certificates and other
rights and privileges now or hereafter obtained in connection with the
Improvements or the Land; and (b) any and all property that is personal
property and fixtures owned by Trustor and now or hereafter located on or used
in connection with the Land, including, but not limited to, all equipment,
fixtures, furniture, furnishings, appliances, carpets, drapes and articles of
personal property owned by Trustor and now or hereafter located on, attached to
or used in and about the Improvements that are reasonably necessary to the
complete and comfortable use and occupancy of the
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Improvements for all purposes for which they are intended, including, but not
limited to, all machines, engines, boilers, dynamos, elevators, stokers, tanks,
cabinets, awnings, screens, shades, blinds, carpets, draperies, lawn mowers,
and all appliances, plumbing, heating, air conditioning, lighting, ventilating,
refrigerating, disposal and incinerating equipment, and all fixtures and
appurtenances thereto, and such other goods and chattels and personal property
owned by Trustor as are ever to be used or furnished in operating the
Improvements, or the activities conducted therein, and all warranties and
guaranties relating thereto; and (c) all renewals or replacements of any of the
aforementioned items, or articles in substitution therefor, whether or not the
same shall be attached to the Improvements in any manner, and all building
materials and equipment hereafter situated on or about the Land. It is hereby
agreed that to the extent permitted by law, all of the foregoing property and
fixtures are to be deemed and held to be a part of and affixed to the Land.
The foregoing security interest shall also cover Trustor's leasehold interest
in any of the foregoing items that are leased by Trustor. Trustor shall, from
time to time upon the written request of Beneficiary, supply Beneficiary with a
current inventory of all of the personal property in which Beneficiary is
granted a security interest hereunder, in such detail as Beneficiary may
require but in no event more often than semi-annually.
2.19 SECURITY AGREEMENT AND FIXTURE FILING. This Deed of Trust
constitutes a Security Agreement and Fixture Filing between Trustor and
Beneficiary with respect to all personal property in which Beneficiary is
granted a security interest hereunder, and, cumulative of all other rights and
remedies of Beneficiary hereunder, Beneficiary shall have all of the rights and
remedies of a secured party under the California Uniform Commercial Code.
Trustor hereby agrees to execute and deliver on demand and hereby irrevocably
constitutes and appoints Beneficiary the attorney-in-fact of Trustor to execute
and deliver, and if appropriate, to file with the appropriate filing officer or
office such security agreements, financing statements, fixture filings,
continuation statements or other instruments as Beneficiary may request or
require in order to impose, perfect or continue the perfection of the lien or
security interest created hereby. Upon the occurrence of any default
hereunder, Beneficiary shall have the right, at its option, to take appropriate
steps to cause any of the Property that is personal property and subject to the
security interest of Beneficiary hereunder to be sold at any one or more public
or private sales as permitted by applicable law, including at a sale held in
conjunction with the sale of the Property by Trustee as provided for in this
Deed of Trust, and apply the proceeds of such sale against the Indebtedness
secured hereby in whatever order Beneficiary shall direct in its absolute
discretion, and Beneficiary shall further have all other rights and remedies as
are available to secured creditors under applicable law. Any such disposition
may be conducted by an employee or agent of Beneficiary or Trustee. Any
person, including both Trustor and Beneficiary, shall be eligible to purchase
any part or all of such property at any such disposition. Expenses of retaking
holding, preparing for sale, selling or the like shall be borne by Trustor and
shall include Beneficiary's and Trustee's attorneys' fees and costs together
with interest thereon at the Default Rate defined in the Promissory Notes.
Trustor, upon demand of Beneficiary, shall assemble such personal property and
make it available to Beneficiary at the Property, a place that is hereby deemed
to be reasonably convenient to Beneficiary and Trustor. If notice is required
by law, Beneficiary shall give Trustor at least ten (10) days' prior written
notice of the time and place of any public sale of such property or of the time
of or after which any private sale or any other intended disposition is to be
made; and if such notice is sent to Trustor, as the same is provided for the
mailing of notices herein, it is hereby deemed that such notice shall be and is
reasonable notice to Trustor. Any sale made pursuant to the provisions of this
SECTION 2.19 shall be deemed to have been a public sale conducted in a
commercially reasonable manner if held contemporaneously with the sale under
the power of sale granted in SECTION 4.2 hereof upon giving the same notice
with respect to the sale of the personal property hereunder as is required
under said SECTION 4.2. Furthermore, in conjunction with, in addition to or in
substitution for the rights and remedies available to Beneficiary pursuant to
the California Uniform Commercial Code: (a) in the event of a foreclosure
sale, whether
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made by Trustee under the terms hereof or under judgment of a court, the
Property may, at the option of Beneficiary, be sold as a whole; and (b) it
shall not be necessary that Beneficiary take possession of the aforementioned
personal property or any part thereof prior to the time that any sale pursuant
to the provisions of this SECTION 2.19 conducted and it shall not be necessary
that said personal property or any part thereof be present at the location of
such sale; and (c) Beneficiary may appoint or delegate any one or more persons
as agent to perform any act or acts reasonably necessary or incident to any
sale held by Beneficiary, including the sending of notices and the conduct of
the sale, but in the name and on behalf of Beneficiary.
In the event that Trustor has executed a separate Security Agreement
concurrently herewith in favor of Beneficiary, all rights and remedies granted
to Beneficiary under such Security Agreement shall be in addition to and
cumulative of all rights and remedies granted to Beneficiary under this SECTION
2.19.
2.20 MAINTENANCE OF THE PROPERTY; COMPLIANCE WITH LAWS. Trustor
shall at all times maintain the Property in good condition and repair, and
shall, upon Beneficiary's reasonable direction, promptly repair, restore,
replace or rebuild any part of the Property that may be affected by any
casualty or any public or private taking of or injury to the Property. Trustor
shall at all times comply with all statutes, ordinances, regulations and other
governmental or quasi-governmental requirements and private covenants relating
to the ownership, use or operation of the Property, including, but not limited
to, any environmental or ecological requirements; provided that so long as
Trustor is not otherwise in default hereunder, Trustor may, upon providing
Beneficiary with security reasonably satisfactory to Beneficiary, proceed
diligently and in good faith to contest the validity or applicability of any
such statute, ordinance, regulation or requirement.
2.21 HAZARDOUS WASTES AND OTHER SUBSTANCES. Trustor hereby
represents and warrants to Beneficiary that, as of the date hereof: (a) to the
best of Trustor's knowledge, the Property is not in direct or indirect
violation of any local, state or federal law, rule or regulation pertaining to
environmental regulation, contamination or clean-up (collectively,
"ENVIRONMENTAL LAWS"), including, without limitation, "CERCLA", "RCRA", state
super-lien and environmental clean-up statutes; and (b) the Property is not
subject to any private or governmental lien or judicial or administrative
notice or action relating to hazardous and/or toxic substances, wastes,
materials, pollutants or contaminants (including, without limitation, asbestos
and raw materials which include hazardous constituents) and any other
substances or materials which are included under or regulated by Environmental
Laws, including, without limitation, "hazardous substances" as defined in
Section 2929.5 of the California Civil Code (collectively, "HAZARDOUS
SUBSTANCES"). Trustor shall not allow any Hazardous Substance to be stored,
located, discharged, possessed, managed, processed or otherwise handled on the
Property, (except in compliance with all laws, ordinances and regulations
pertaining thereto) and Trustor shall comply with all Environmental Laws.
Trustor shall promptly notify Beneficiary if Trustor shall become aware of the
release or threat of release on the Property of any Hazardous Substances and/or
if Trustor shall become aware that the Property is in direct or indirect
violation of any Environmental Laws, in which event Trustor shall remove such
Hazardous Substances and/or cure such violations to the extent and in the
manner required by governmental authorities having jurisdiction over the
Property, as applicable, promptly after Trustor becomes aware of the same, at
Trustor's sole expense. In the event Trustor fails to do so after thirty (30)
days' written notice from Beneficiary, then, Beneficiary may cause the Property
to be freed from any Hazardous Substances or otherwise brought into conformance
with Environmental Laws and any cost incurred in connection therewith shall be
paid by Trustor on demand and, if not so paid, shall be added to the
outstanding principal balance of the Note (even if such addition results in the
outstanding principal balance being in excess of the face amount of the
Promissory Notes), shall bear
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interest thereafter until actually paid by Trustor at the Default Rate defined
in the Note and shall be secured hereby and by all of the other Loan Documents
securing all or any part of the Indebtedness. Subject to the notice and cure
provisions set forth in SECTION 3.1(B) hereof, Trustor hereby grants to
Beneficiary and its agents and employees access to the Property at all
reasonable times and a license to remove any items deemed by Beneficiary to be
Hazardous Substances and to do all things Beneficiary shall deem reasonably
necessary to bring the Property in conformance with Environmental Laws.
Beneficiary shall have all rights of entry and inspection with respect to the
Property and such other rights as are provided in Section 2929.5 of the
California Civil Code, or any successor statute. Trustor hereby indemnifies
Beneficiary and holds Beneficiary harmless from and against any and all
expenses, damages, penalties, fines, and costs, including, without limitation,
attorneys' fees and consequential damages (collectively "COSTS"), incurred by
Beneficiary as a result of the existence of any Hazardous Substances on, in or
under the Property and/or as a result of the failure of the Property to comply
with any Environmental Laws. The foregoing indemnity shall not apply with
respect to any Costs incurred by Beneficiary resulting from the presence of
Hazardous Substances on, in or under the Property or the failure of the
Property to comply with any Environmental Laws which arise due to the presence
of Hazardous Substances on, in or under the Property, or the failure of the
Property to comply with any Environmental Laws which relate only to acts,
omissions or events which occur subsequent to the earlier of the date that
Beneficiary (or its assignee or any purchaser at a foreclosure sale or
transferee under a deed-in-lieu thereof) either takes possession of the
Property (which includes the appointment of a receiver) or acquires title to
the Property (except to the extent that Trustor is in possession). In the
event that Trustor has executed a separate Indemnity Agreement concurrently
herewith in favor of Beneficiary, whether secured or unsecured, all rights and
remedies granted to Beneficiary under such Indemnity Agreement shall be in
addition to and cumulative of all rights and remedies granted to Beneficiary
under this SECTION 2.21, but in the event of any inconsistency or discrepancy
between the provisions hereof and the provisions of such Indemnity Agreement,
the provisions of such Indemnity Agreement shall control.
2.22 ADDITIONAL TAXES. In the event of the enactment after the
date of this Deed of Trust of any law of the State of California or of any
other governmental entity deducting from the value of the Property for the
purpose of taxation any lien or security interest thereon, or imposing upon
Beneficiary the payment of the whole or any part of the taxes or assessments or
charges or liens herein required to be paid by Trustor, or changing in any way
the laws relating to the taxation of deeds of trust or mortgages or security
agreements or debts secured by deeds of trust or mortgages or security
agreements or he interest of the mortgagee or secured party in the property
covered thereby, or the manner of collection of such taxes, so as to affect
this Deed of Trust or the Indebtedness secured hereby or Beneficiary, then, and
in any such event, Trustor, upon demand by Beneficiary, shall pay such taxes,
assessments, charges or liens, or reimburse Beneficiary therefor, provided,
however, that if in the opinion of counsel for Beneficiary (a) it might
be unlawful to require Trustor to make such payment, or (b) the making of such
payment might result in the imposition of interest beyond the maximum amount
permitted by law, then and in either such event, Beneficiary may elect, by
notice in writing given to Trustor, to declare all of the Indebtedness secured
hereby to be and become due and payable in full ninety (90) days from the
giving of such notice.
2.23 SECURED INDEBTEDNESS. It is understood and agreed that this
Deed of Trust shall secure payment of not only the Indebtedness but also any
and all renewals and extensions of the Promissory Notes, any and all other
indebtedness and obligations arising pursuant to the terms hereof, and any and
all other indebtedness and obligations arising pursuant to the terms of any of
the other Loan Documents.
2.24 TRUSTOR'S WAIVERS. To the full extent Trustor may do so,
Trustor agrees that Trustor shall not at any time insist upon, plead, claim or
take the benefit or advantage of any law now or
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hereafter in force providing for any appraisal, valuation, moratorium or
extension; and Trustor, for Trustor and Trustor's successors and assigns, and
for any and all persons ever claiming any interest in the Property, to the
extent permitted by law, hereby waives and releases all rights of valuation,
appraisal, and all rights to a marshalling of the assets of Trustor, including
the Property, to a sale in inverse order of alienation, or to direct the order
in which any of the Property shall be sold in the event of foreclosure of the
liens and security interests hereby created. Trustor shall not have or assert
any right under any statute or rule of law pertaining to the marshalling of
assets, sale in inverse order or alienation, the exemption of homestead, the
administration of estates of decedents or other matters whatever to defeat,
reduce or affect the right of Beneficiary under the terms of this Deed of Trust
to a sale of the Property, for the collection of the Indebtedness secured
hereby without any prior or different resort for collection, or the right of
Beneficiary under the terms of this Deed of Trust to the payment of such
Indebtedness out of the proceeds of sale of the Property in preference to every
other claimant whatever.
ARTICLE 3
EVENTS OF DEFAULT
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3.1 An "EVENT OF DEFAULT" shall have occurred under this Deed of
Trust if any of the following events occurs:
(a) The occurrence of an Event of Default under the Note
or any of the other Loan Documents subject to applicable notice and cure
periods; or
(b) Trustor fails to perform any covenant, agreement or
obligation contained in this Deed of Trust on or before the date such covenant,
agreement or obligation is required to be performed unless Trustor cures the
same (i) within any stated grace or cure period set forth herein; or (ii) if
there is not stated grace or cure period, then within (A) ten (10) days after
giving written notice of such failure if and to the extent such failure can be
cured solely by the payment of money; or (B) thirty (30) days after giving
written notice of such failure if such failure cannot be cured solely by the
payment of money, unless such default is of a nature which cannot be cured, in
which event there shall be no cure period (for example, a default under SECTION
2.11 resulting from the unauthorized Transfer of the Property); or
(c) Trustor, or any guarantor of the Promissory Notes,
shall generally not pay its debts as such debts become due, or shall admit in
writing its inability to pay its debts generally or shall make a general
assignment for the benefit of its creditor; or
(d) If any proceeding shall be instituted by or against
Trustor or any guarantor of the Note seeking to adjudicate it a bankrupt or
insolvent, or seeking liquidation, winding up, reorganization, arrangement,
adjustment, protection, relief or composition of Trustor or any guarantor of
the Promissory Notes, or their debts, under any law relating to bankruptcy,
insolvency, reorganization or relief of debtors, or seeking the entry of an
order for the appointment of a receiver, trustee, custodian or similar official
with respect to Trustor, or any guarantor of the Note, or for any substantial
part of their respective properties (provided that if any of the foregoing
actions instituted against Trustor or any guarantor of the Promissory Notes are
dismissed within thirty (30) days thereafter, then no Event of Default shall be
deemed to have occurred); or
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ARTICLE 4
REMEDIES
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4.1 REMEDIES AVAILABLE. If an Event of Default has occurred under
this Deed of Trust, Beneficiary may, at its option at any time thereafter do
any one or more of the following:
(a) Declare any or all of the Indebtedness secured hereby
to be immediately due and payable without presentment, demand, protest or
notice of any kind; and/or
(b) Either in person or by agent, with or without
bringing any action or proceeding, or by a receiver appointed by a court and
without regard to the adequacy of its security, enter upon and take possession
of the Property, or any part thereof, and do any and all acts that may be
desirable in Beneficiary's reasonable judgment to complete any unfinished
construction on the Property, to preserve the value, marketability or
rentability of the Property, to increase the income therefrom, to manage and
operate the Property or to protect the security hereof and, with or without
taking possession of the Property, sue for or otherwise collect the Rents and
Profits, including those past due and unpaid, and apply the same, less
reasonable costs and expenses of operation and collection, including, without
limitation, attorneys' fees, against the Indebtedness secured hereby in such
order as Beneficiary may determine, without in any way curing or waiving any
default of Trustor; and/or
(c) Commence an action to foreclose this Deed of Trust or
to specifically enforce its provisions or any of the obligations secured by
this Deed of Trust; and/or
(d) Deliver to Trustee a written declaration of default
and demand for sale, and a written notice of default and of election to cause
the Property to be sold, and cause any or all of the Property to be sold under
the power of sale granted by this Deed of Trust in any manner permitted by
applicable law; and/or
(e) Exercise any other right or remedy available
hereunder, under any of the other Loan Documents or at law or in equity.
4.2 SALE. Should Beneficiary elect to foreclose by exercise of
the power of sale herein contained, Beneficiary shall notify Trustee as above
provided and shall deposit with Trustee this Deed of Trust, the Note, all other
notes, if any, secured hereby and all documents evidencing expenditures secured
hereby.
(a) Trustee shall cause Beneficiary's written notice of
default and of election to cause the Property to be sold to be filed for
record. After the lapse of such time as may then be required by law following
the recordation of said notice of default, and notice of sale having been given
as then required by law, Trustee, without demand on Trustor, shall sell the
Property at the time and place fixed by Trustee in said notice of sale, either
as a whole or in separate parcels, and in such order as Trustee may determine,
at public auction to the highest bidder for cash in lawful money of the United
States, payable at the time of sale. Trustee may postpone the sale of all or
any portion of the Property by public announcement at the 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. Trustee shall
deliver to such purchaser its deed conveying the Property, or portion thereof,
so sold, but without any covenant or warranty, express or implied. The
recitals in such deed of any matters or facts shall be conclusive proof of the
truthfulness thereof. Any person, including Trustor, Trustee or Beneficiary,
may purchase at such sale.
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(b) The proceeds of any sale under this Deed of Trust
shall be applied in the following manner:
FIRST: Payment of the reasonable costs and expenses
of the sale, including, but not limited to, Trustee's legal fees and
disbursements, title charges and transfer taxes, and payment of all expenses,
liabilities and advances of Trustee.
SECOND: Payment of all reasonable sums expended by
Beneficiary under the terms of this Deed of Trust and not yet repaid, together
with interest on such sums at the Default Rate defined in the Promissory Notes.
THIRD: Payment of the obligations of Trustor secured
by this Deed of Trust, including, without limitation, interest at the Default
Rate defined in the Note, in any order that Beneficiary chooses.
FOURTH: The remainder, if any, to the person or
persons legally entitled thereto.
4.3 RECEIVER. In addition to all other remedies herein provided
for, Trustor agrees that upon the occurrence of an Event of Default hereunder,
Beneficiary shall, as a matter of right, be entitled to the appointment of a
receiver or receivers for all or any part of the Property, whether such
receivership be incident to a proposed sale of the Property or otherwise, and
without regard to the value of the Property or the solvency of Trustor or any
person or persons liable for the payment of the Indebtedness secured hereby,
and Trustor does hereby consent to the appointment of such receiver or
receivers, waives any and all notices of and defenses to such appointment and
agrees not to oppose any application therefor by Xxxxxxxxxxx, but nothing
herein is to be construed to deprive Beneficiary of any other right, remedy or
privilege it may now have under the law to have a receiver appointed; provided,
however, that the appointment of such receiver, trustee or other appointee by
virtue of any court order, statute or regulation shall not impair or in any
manner prejudice the rights of Beneficiary to receive payment of the Rents and
Profits pursuant to other terms and provisions hereof. Any money advanced by
Beneficiary in connection with any such receivership shall be a demand
obligation owing by Trustor to Beneficiary, shall bear interest from the date
of making such advancement by Beneficiary until paid at the Default Rate
defined in the Promissory Notes, shall be a part of the Indebtedness secured
hereby and by every other instrument securing the Indebtedness. The receiver
or his agents shall be entitled to enter upon and take possession of any and
all of the Property to the same extent and in the same manner as Trustor might
lawfully do. The receiver, personally or through its agents or attorneys, may
exclude Trustor and its agents, servants and employees wholly from the Property
and may have, hold, use, operate, manage and control the same and each and
every part thereof, and in the name of Trustor or Trustor's agents, may
exercise all of their rights and powers and use all of the then existing
materials, current supplies, stores and assets and, at the expense of the
Property, maintain, restore, insure and keep insured the properties, equipment,
and apparatus provided or required for use in connection with the business or
businesses operated on the Property and may make all such reasonably necessary
and proper repairs, renewals and replacements and all such useful alterations,
additions, betterments and improvements as the receiver may deem judicious.
Such receivership shall, at the option of Beneficiary, continue until full
payment of all sums hereby secured or until title to the Property shall have
passed by foreclosure sale under this Deed of Trust.
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4.4 OCCUPANCY AFTER FORECLOSURE. In the event there is a
foreclosure sale hereunder and at the time of such sale, Trustor or Trustor's
representatives, successors or assigns, or any other persons claiming any
interest in the Property by, through or under Trustor are occupying or using
the Property, or any part thereof, each and all shall, at the option of
Beneficiary or the purchaser at such sale, as the case may be, immediately
become the tenant of the purchaser at such sale, which tenancy shall be a
tenancy from day-to-day, terminable at the will of either landlord or tenant,
at a reasonable rental per day based upon the value of the Property occupied,
or used, such rental to be due daily to purchaser. In the event the tenant
fails to surrender possession of the Property upon the termination of such
tenancy, the purchaser shall be entitled to institute and maintain an action
for unlawful detainer of the Property in the appropriate court of Imperial
County, State of California.
4.5 CUMULATIVE REMEDIES. All remedies contained in this Deed of
Trust are cumulative, and Beneficiary also has all other remedies provided at
law or in equity or in any other of the Loan Documents between Trustor and
Beneficiary. No act of Beneficiary shall be construed as an election to
proceed under any particular provision of this Deed of Trust to the exclusion
of any other provision of this Deed of Trust or as an election of remedies to
the exclusion of any other remedy that may then or thereafter be available to
Beneficiary. No delay or failure by Beneficiary to exercise any right or
remedy under this Deed of Trust shall be construed to be a waiver of that right
or remedy or of any default by Trustor. Beneficiary may exercise any one or
more of its right and remedies at its option without regard to the adequacy of
its security.
4.6 PAYMENT OF EXPENSES. Trustor shall pay all of Beneficiary's
and Trustee's reasonable expenses incurred in any efforts to enforce any terms
of this Deed of Trust, whether or not any lawsuit is filed, including, but not
limited to, attorneys' fees and disbursements, foreclosure costs and title
charges together with interest thereon at the Default Rate defined in the Note.
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ARTICLE 5
MISCELLANEOUS TERMS AND CONDITIONS
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5.1 TIME OF ESSENCE. Time is of the essence with respect to all
provisions of this Deed of Trust.
5.2 CERTAIN POWERS OF TRUSTEE. At any time or from time to time,
without liability therefor and without notice, upon written request of
Beneficiary and presentation of this Deed of Trust and the Promissory Notes,
and without affecting the personal liability of any person for payment of the
Indebtedness secured hereby or the effect of this Deed of Trust upon the
remainder of the Property, Trustee may (a) reconvey any part of the Property;
(b) consent in writing to the making of any subdivision map or plat thereof;
(c) join in granting any easement thereon; or (c) join in any extension
agreement or any agreement subordinating the lien hereof.
5.3 CERTAIN RIGHTS OF BENEFICIARY. Without affecting Trustor's
liability for the payment of any of the obligations secured by this Deed of
Trust, Beneficiary may from time to time and without notice to Trustor (a)
release any person liable for the payment of the Indebtedness secured hereby;
(b) extend or modify the terms of payment of said Indebtedness; or (c) accept
additional real or personal property of any kind as security or later,
substitute or release any property securing said Indebtedness.
5.4 ACCEPTANCE BY TRUSTEE. Trustee accepts this Trust when this
Deed of Trust, duly executed and acknowledged, is made a public record as
provided by law. Trustee is not obligated to notify any party hereto of
pending sale under any other deed of trust or of any action or proceeding in
which Trustor, Beneficiary or Trustee shall be a party unless brought by
Trustee.
5.5 SUBSTITUTED TRUSTEE. Beneficiary may, from time to time, by
instrument in writing, substitute a successor or successors to any Trustee
named herein or acting hereunder, which instrument, executed and acknowledged
by Beneficiary and recorded in the office of the recorder of the county or
counties where the Land is situated, shall be conclusive proof of proper
substitution of such successor Trustee or Trustees, who shall, without
conveyance from the Trustee predecessor, succeed to all its title, estate,
rights, powers and duties. Said instrument must contain the name and address
of the new Trustee.
5.6 NOTICES. All notices required or permitted to be given
pursuant to this Deed of Trust, the Promissory Notes, or under any of the other
Loan Documents (unless otherwise expressly provided therein) shall be in
writing, and shall be delivered either personally, by overnight delivery
service (such as Federal Express) or by U.S. certified mail, postage prepaid,
return-receipt requested and addressed to the parties at their respective
addresses shown in this Deed of Trust. The parties may change their addresses
for notice by giving notice of such change in accordance with this section.
Notices sent by overnight delivery service shall be deemed received on the
business day following the date of deposit with the delivery service. Mailed
notices shall be deemed received upon the earlier of the date of delivery shown
on the return receipt, or the second business day after the date of mailing.
5.7 SUCCESSORS AND ASSIGNS. The terms, provisions, covenants and
conditions hereof shall be binding upon Trustor and the successors and assigns
of Trustor, including all successors in interest of Trustor in and to all or
any part of the Property, and shall inure to the benefit of Trustee and
Beneficiary and their respective successors and assigns and shall constitute
covenants running with the land. Provided, however, that nothing herein shall
be deemed to be a consent to any Transfer of the Property, or any part thereof,
by Trustor in violation of the provisions of SECTION 2.11 hereof. All
references in
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this Deed of Trust to Trustor, Trustee or Beneficiary shall be deemed to
include all such parties' successors and assigns; and the term "Beneficiary" as
used herein shall also mean and refer to any lawful holder or owner, including
pledgees and participants, of any of the Indebtedness secured hereby. If
Trustor consists of more than one person or entity, each shall be jointly and
severally liable to perform the obligations of Trustor.
5.8 SEVERABILITY. A determination that any provision of this Deed
of Trust is unenforceable or invalid shall not affect the enforceability or
validity of any other provision, and any determination that the application of
any provision of this Deed of Trust to any person or circumstance is illegal or
unenforceable shall not affect the enforceability or validity of such provision
as it may apply to any other persons or circumstances.
5.9 GENDER. Within this Deed of Trust, words of any gender shall
be held and construed to include any other gender, and words in the singular
shall be held and construed to include the plural, and vice versa unless the
context otherwise requires.
5.10 WAIVER. Beneficiary shall not be deemed to have waived any
provision of this Deed of Trust, or the Note secured hereby or of any of the
other Loan Documents unless such waiver is in writing and is signed by
Beneficiary. Without limiting the generality of the preceding sentence,
Beneficiary's acceptance of any payment with knowledge of a default by Trustor
shall not be deemed a waiver of such default. No waiver by Beneficiary of any
default on the part of Trustor or breach of any of the provisions of this Deed
of Trust shall be considered a waiver of any other or subsequent default or
breach, and no delay or omission in exercising or enforcing the rights and
powers herein granted shall be construed as a waiver of such rights and powers,
and every such right and power may be exercised from time to time.
5.11 SECTION HEADINGS. The headings of the sections and paragraphs
of this Deed of Trust are for convenience of reference only, are not to be
considered a part hereof and shall not limit or otherwise affect any of the
terms hereof.
5.12 GOVERNING LAW. This Deed of Trust, and its validity,
enforcement and interpretation, shall be governed by Texas law (without regard
to any conflict of laws principles) and applicable United States federal law,
except to the extent of procedural and substantive matters relating only to the
creation and perfection of liens and security interests in, and the enforcement
of rights and remedies against, the Mortgaged Property, which matters shall be
governed by the laws of the State of California.
5.13 COUNTING OF DAYS. The term "days" when used herein shall mean
calendar days. If any time period ends on a Saturday, Sunday or holiday
officially recognized by the State of Texas, the period shall be deemed to end
on the next succeeding business day.
5.14 RELATIONSHIP OF THE PARTIES. The relationship between Trustor
and Beneficiary is that of a borrower and a lender only; and neither of those
parties is, nor shall it hold itself out to be, the agent, employee, joint
venturer or partner of the other party.
5.15 ENTIRE AGREEMENT AND MODIFICATIONS. This Deed of Trust and
the other Loan Documents contain the entire agreements between the parties
relating to the subject matter hereof and thereof and all prior agreements
relative hereto and thereto which are not contained herein or therein are
terminated. This Deed of Trust and the other Loan Documents may not be
amended, revised, waived, discharged, released or terminated orally but only by
a written instrument or instruments executed by the party against which
enforcement of the amendment, revision, waiver, discharge, release or
termination is
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asserted. Any alleged amendment, revision, waiver, discharge, release or
termination which is not so documented shall not be effective as to any party.
5.16 REQUEST FOR NOTICE OF DEFAULT. In accordance with Section
2924b of the California Civil Code, request is hereby made by Trustor that a
copy of any Notice of Default and a copy of any Notice of Sale under this Deed
of Trust be mailed to Trustee at the following address 0000 Xxxx Xxxxxxx, Xxxxx
000, Xxxxxxx, Xxxxx 00000.
5.17 RECONVEYANCE. Upon the payment in full of all sums secured by
this Deed of Trust, Beneficiary agrees to request Trustee to reconvey the
Mortgaged Property. Upon payment of Trustee's fees and all other sums owing to
it under this Deed of Trust, Trustee will reconvey the Mortgaged Property to
the person or persons legally entitled thereto. Such person or persons must
pay all costs and expenses in connection therewith. The recitals of any facts
in the reconveyance will be conclusive on all persons. The grantee in the
reconveyance may be described as "the person or persons legally entitled
thereto."
IN WITNESS WHEREOF, Xxxxxxx has executed this Deed of Trust as of the
date first above written.
"TRUSTOR"
SOUTHWESTERN ICE, INC., a Texas corporation
By:
---------------------------------
Xxxxx X. Xxxxxx, Chief Executive Officer
STATE OF TEXAS )
)
COUNTY OF BEXAR )
On September ___, 1997, before me, _______________________________,
Notary Public, personally appeared Xxxxx X. Xxxxxx, Chief Executive Officer of
SOUTHWESTERN ICE, Inc., a Texas corporation, personally known to me/proved to
me on the basis of satisfactory evidence to be the person[s] whose name[s]
[is/are] subscribed to the within LEASEHOLD DEED OF TRUST, SECURITY AGREEMENT,
ASSIGNMENT OF RENTS AND FIXTURE FILING and acknowledged to me that he/she/they
executed the same in his/her/their authorized capacity, and that by
his/her/their signature on the instrument the person, or the entity upon behalf
of which the person acted, executed the instrument.
WITNESS my hand and official seal.
--------------------------------------
NOTARY
[SEAL]
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EXHIBIT "A"
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All of Trustor's right, title, and interest in the real property
described below, arising out of:
Lease Agreement dated October 20, 1995, between One Governor Park Office
Building, LP and MCS, Ltd., said Lease Agreement having been assigned to
Trustor on July 3, 1997, covering property located at 0000 Xxxxxxx Xxxx, Xxx
Xxxxx, Xxx Xxxxx Xxxxxx, Xxxxxxxxxx, recorded on September ___, 1997 in the
official records of San Diego County, California at instrument number
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SWI California Leasehold Deed of Trust
