Contract
EXHIBIT
4.2b
SCHEDULES
AND EXHIBITS OF TERM LOAN AGREEMENT, DATED AS OF NOVEMBER 2, 2007, AMONG LSB
INDUSTRIES, INC., THERMACLIME, INC. AND CERTAIN SUBSIDIARIES OF THERMACLIME,
INC., CHEROKEE NITROGEN HOLDINGS, INC., THE LENDERS, THE ADMINISTRATIVE AND
COLLATERAL AGENT AND THE PAYMENT AGENT, WHICH TERM LOAN AGREEMENT THE
COMPANY FILED AS EXHIBIT 4.1 TO THE COMPANY’S FORM 10-Q FOR THE FISCAL
QUARTER ENDED SEPTEMBER 30, 2007.
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SCHEDULES
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1.01(a)
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Cherokee
Site
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1.01(b)
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El
Dorado Site
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1.01(c)
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Facility
Assets
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1.01(d)
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Lenders
and Lending Offices
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2.01
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Commitments
and Applicable Percentages
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4.01(a)(iii)
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Financing
Statements
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4.01(a)(iv)
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Leased
Property
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5.03
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Government
Authorizations and Other Consents
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5.05
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Indebtedness
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5.06
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Litigation
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5.09
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Environmental
Matters
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5.13
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Subsidiaries
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5.18
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IP
Rights
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5.21
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Pipelines
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5.22
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Material
Contracts
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5.23
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Permits
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5.27
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Labor
Matters
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7.01(b)
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Existing
Liens
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7.02
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Existing
Indebtedness and Guarantees
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7.03
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Existing
Investments
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7.05
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Facility
Leases/Uses
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7.08
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Affiliate
Transactions
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7.09
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Burdensome
Agreements
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11.02
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Addresses
for Notices; Payment Information
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EXHIBITS
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A
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Term
Note
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B
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Compliance
Certificate
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C
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Borrowing
Notice
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D
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E
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Security
Agreement
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F-1
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Cherokee
Mortgage
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X-0
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Xx
Xxxxxx Mortgage
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G
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Assignment
and Consent Agreement
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H-1
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Intercompany
Lease Subordination Agreement
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H-2
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Intercompany
Loan Subordination Agreement
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I
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Management
Agreement Subordination
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J-1
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Opinion
Matters – Counsel to Loan Parties
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J-2
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Opinion
Matters – Local Counsel (Alabama)
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J-3
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Opinion
Matters – Local Counsel (Arkansas)
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K
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Inter-Lender
Agreement
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L
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Assignment
and Subordination Agreement
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M
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Trademark
Security Agreement
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SCHEDULE
1.01(a)
LEGAL DESCRIPTION OF
CHEROKEE SITE
The tract
or lot of land lying in the County of Colbert, State of Alabama, known and
described as follows, to wit:
PARCEL
I:
Begin at
the Northwest corner of Section 0, Xxxxxxxx 0 Xxxxx, Xxxxx 00 Xxxx, Xxxxxxx
Xxxxxx, Xxxxxxx, and run thence South 0 degrees 36 minutes 44 seconds West
2621.36 feet with the westerly boundary line of said Section 7 to a point on
said boundary line; thence run North 88 degrees 55 minutes 46 seconds West
990.00 feet to a point; thence run South 0 degrees 35 minutes 43 seconds West
2623.55 feet parallel with the westerly boundary line of said Section 7, to a
point on the northerly boundary line of Xxxxxxx 00, Xxxxxxxx 0 Xxxxx, Xxxxx 00
Xxxx; thence run South 0 degrees 46 minutes 39 seconds West a distance of
5329.16 feet to a point on the southerly boundary of Xxxxxxx 00, Xxxxxxxx 0
Xxxxx, Xxxxx 00 Xxxx; thence run South 87 degrees 49 minutes 42 seconds East
1000.47 feet to the Southwest corner of Xxxxxxx 00, Xxxxxxxx 0 Xxxxx, Xxxxx 00
Xxxx; thence run South 89 degrees 14 minutes 26 seconds East 1397.26 feet to the
Southwest corner of the Southeast quarter of the Southeast quarter of said
Section 18, which section is a fractional section; thence run North 0 degrees 21
minutes 39 seconds East a distance of 46.5 feet to a concrete monument on the
north right-of-way margin of Xxxx Academy Road; thence south 89 degrees 08
minutes 27 seconds east along said north right-of-way margin a distance of
1,281.76 feet to a concrete monument; thence south 88 degrees 50 minutes 29
seconds east a distance of 2,191.21 feet; thence south 89 degrees 04 minutes 39
seconds east a distance of 474.74 feet; thence north 12 degrees 06 minutes 31
seconds east a distance of 784.37 feet; thence north 12 degrees 02 minutes 41
seconds east a distance of 51.11 feet; thence south 89 degrees 59 minutes 07
seconds west a distance of 726.65 feet; thence north 00 degrees 00 minutes 42
seconds east a distance of 414.62 feet; thence north 84 degrees 05 minutes 23
seconds east a distance of 780.35 feet; thence north 00 degrees 41 minutes 22
seconds east a distance of 816.26 feet to the south right-of-way margin of a 200
foot railroad right-of-way; thence north 88 degrees 03 minutes 37 seconds west
along said south right-of-way margin a distance of 1,193.19 feet; thence
westerly along the curving south right-of-way margin a distance of 347.85 feet
(said curve concave south, having a radius of 1,046.00 feet, a chord bearing of
south 82 degrees 24 minutes 48 seconds west, a chord length of 346.25 feet);
thence north 02 degrees 12 minutes 51 seconds west a distance of 205.80 feet to
the north right-of-way margin of a 200 foot railroad right-of-way; thence
easterly along the curving north right-of-way margin a distance of 361.43 feet
(said curve concave south, having a radius of 1,246.00 feet, a chord bearing
north 83 degrees 37 minutes 48 seconds east, a chord distance of 360.16 feet);
thence south 88 degrees 03 minutes 37 seconds east a distance of 1,188.82 feet;
thence north 00 degrees 41 minutes 22 seconds east a distance of 310.14 feet;
thence south 89 degrees 24 minutes 33 seconds east a distance of 240.77 feet to
U.S.-T.V.A. Monument No. 50 (being a concrete monument capped by a bronz tablet
showing said monument number and also "T.3S.R.13W.", and all other references to
U.S.-T.V.A. monuments herein shall refer to monuments of like character); thence
north 00 degrees 24 minutes 16 seconds east a distance of
Page
1 of 7
420.42
feet to U.S.-T.V.A. Monument No. 51; thence run north 33 degrees 37 minutes west
2,733.00 feet to U.S.-T.V.A. Monument No. 52 in the north line of Section 17,
which is in the south line of Section 8; thence north 37 degrees 38 minutes west
416.00 feet to U.S.-T.V.A. Monument No. 53 at the northwest corner of the
Southwest Quarter of the Southwest Quarter of the Southeast Quarter of the
Southwest Quarter of Section 8; thence north 01 degree 35 minutes east 977.00
feet to U.S.-T.V.A. Monument No. 54 at the northwest corner of the Southeast
Quarter of the Southwest Quarter of Section 8; thence north 35 degrees 59
minutes west 1,633.00 feet to U.S.-T.V.A. Monument No. 55 at the southeast
corner of the Southwest Quarter of the Southwest Quarter of the Southwest
Quarter of the Northwest Quarter of Section 8; thence north 88 degrees 50
minutes west 332.00 feet to U.S.-T.V.A. Monument No. 56 at the southwest corner
of the Northwest Quarter of Section 8; thence with the south line of the
Northeast Quarter of Section 7 north 88 degrees 50 minutes west 330.00 feet to
U.S.-T.V.A. Monument No. 57; thence leaving the said south line north 01 degree
23 minutes 15 seconds east 1,966.31 feet to U.S.-T.V.A. Monument No. 58; thence
run north 88 degrees 35 minutes west 336.33 feet to U.S.-T.V.A. Monument No. 59;
thence run south 68 degrees 55 minutes 24 seconds west 1,751.46 feet, more or
less, to a point on the south line of the north half of the north half of
Section 7, Township 3 South, Range 13 West, which point is to be found by
finding the intersection of said south line of said north half of the north half
of said Section 7 with a line run south 00 degrees 39 minutes 12 seconds west a
distance of 45 feet from U.S.-T.V.A. Monument No. 60; thence run north 00
degrees 39 minutes 12 seconds east 659.42 feet; thence run north 56 degrees 58
minutes 57 seconds east 1,150.50 feet, more or less, to U.S.-T.V.A. Monument No.
62 which is located in the north boundary of said Section 7 at a point 1,399.63
feet easterly from the northwest corner thereof; thence run north 88 degrees 39
minutes 30 seconds west with said section line 1,399.63 feet to the POINT OF
BEGINNING.
LESS AND
EXCEPT FROM THE FOLLOWING PARCELS: III, IV, V, VI, AND
VII:
Parcel
III:
Commencing
at the Southwest corner of Section 18, T-3-S, R-13-W, Colbert County, Alabama,
thence North 0 degrees 48 minutes East along the West line of said Section 18 a
distance of 4085.36 feet to a point; thence North 89 degrees 58 minutes East a
distance of 2003.88 feet to a concrete monument and the point of beginning of
the tract herein described; thence North 0 degrees 02 minutes West a distance of
450.00 feet to a point on a chain link fence; thence North 89 degrees 58 minutes
East with chain link fence a distance of 298.00 feet to a point; thence South 0
degrees 02 minutes East with chain link fence a distance of 116.50 feet to a
point; thence North 89 degrees 58 minutes East with chain link fence a distance
of 52.00 feet to a point; thence South 0 degrees 02 minutes East with chain link
fence a distance of 333.50 feet to a point; thence leaving said chain link fence
South 89 degrees 58 minutes West a distance of 2.00 feet to a concrete monument;
thence continuing South 89 degrees 58 minutes West a distance of 348.00 feet to
the concrete monument at the point of beginning of the tract herein
described.
Page 2 of
7
Parcel
IV
Commence
at the Southwest corner of the said Section 0, Xxxxxxxx 0 Xxxxx, Xxxxx 00 Xxxx,
Xxxxxxx Xxxxxx, Xxxxxxx; thence North 0 degrees 36 minutes 44 seconds east along
the west line of the said Section 7 a distance of 2621.68 feet to the northwest
corner of the Southwest 1/4 of the said Section 7 and the point of beginning of
the tract herein described; thence continuing north 0 degrees 36 minutes 44
seconds east a distance of 200.00 feet to a point; thence south 89 degrees 23
minutes 16 seconds east a distance of 1500.00 feet to a point; thence south 0
degrees 36 minutes 44 seconds west a distance of 600.0 feet to a point; thence
north 89 degrees 23 minutes 16 seconds west a distance of 1500.0 feet to a point
on the west line of said Section 7; thence north 0 degrees 36 minutes 44 seconds
east a distance of 400.0 feet to the point of beginning of the tract herein
described.
Parcel
V
A parcel
of land located in Section 00, Xxxxxxxx 0-Xxxxx, Xxxxx 13-West in Colbert
County, State of Alabama, said parcel lying east of a right of way for a
proposed road approximately 3 miles north of Cherokee, and being more
particularly described as follows: Commencing at a point in the east
line of Section 18, said point being 1276.0 feet south of the northeast corner
of said section; thence xxx xxxx, 620.9 feet to the POINT OF BEGINNING at the
northeast corner of the parcel of land herein described; thence due south 600.0
feet to a point; thence xxx xxxx, 500.0 feet to a point; thence with a line
132.0 feet east of and parallel to the east line of the right of way of a
proposed road due north, 600.0 feet to a point; thence due east, 500.0 feet to
the point of beginning.
Parcel
VI
Also for
the point of beginning, commence at the intersection of the South line of North
half of North half of Section 0, Xxxxxxxx 0 Xxxxx, Xxxxx 00 Xxxx, Xxxxxxx
Xxxxxx, Xxxxxxx, with a line run South 0 degrees 39 minutes 12 seconds West from
U.S.-T.V.A. Monument No. 60; thence run North 0 degrees 39 minutes 12 seconds
East 659.42 feet to the point of beginning; from said point of beginning run
thence North 56 degrees 58 minutes 57 seconds E 1150.50 feet, more or less, to
U.S.-T.V.A. Monument No. 62, which is located in the North boundary of Section 7
at a point of 1399.63 feet easterly from the Northwest corner thereof; from said
Monument No. 62 run thence South 58 degrees 53 minutes 18 seconds West 1126.17
feet to U.S.-T.V.A. Monument No. 61; thence run South 0 degrees 39 minutes 12
seconds West to the point of beginning.
Parcel
VII:
Commence
at the southwest corner of Section 00, Xxxxxxxx 0 Xxxxx, Xxxxx 00 Xxxx, Xxxxxxx
Xxxxxx, Xxxxxxx; thence south 89 degrees 14 minutes 26 seconds east along the
South boundary of said Section 18 a distance of 1,397.26 feet; thence run North
00 degrees 21 minutes 39 seconds
Page 3
of 7
East a
distance of 825.71 feet to the POINT OF BEGINNING; continue thence North 00
degrees 21 minutes 39 seconds East a distance of 505.52 feet; thence South 89
degrees 22 minutes 51 seconds East a distance of 1,116.70 feet; thence South 66
degrees 13 minutes 10 seconds West along said southeasterly right of way margin
a distance of 1,223.71 feet to the POINT OF BEGINNING, containing 6.48 acres,
more or less, and then being that same parcel of land described in Deed Book
264, Page 560 as recorded in the Probate Office of Colbert County,
Alabama.
PARCEL
II:
A tract
of land lying in Colbert County, State of Alabama, in the East half of East half
of Northeast quarter, Section 7, the West half of Northwest quarter and
Southwest quarter of Section 8, and the Northeast quarter and East half of
Northwest quarter of Section 17, Township 3 South, Range 13 West on the
southwest shore of Pickwick Landing Lake opposite Kogor's Island and
approximately 4 miles northeast of Cherokee, Alabama, and being more
particularly described as follows:
Beginning
at U.S.-T.V.A. Monument 51 in the Southwest quarter of Southwest quarter of
Northeast quarter of Section 17 and in the boundary of true United States of
America's land at a corner of the land of Xxx. X.X. Xxxxxx and X.X. Xxxxxxxx
& X.X. Xxxxx' thence with the United States of America's boundary North 33
degrees 37' West 2733.00 feet to the U.S.-T.V.A. Monument 52 in the north line
of Section 17, which is the south line of Section 8; thence North 37 degrees 38'
West, 416.00 feet to U.S.-T.V.A. Monument 53 at the northwest corner of the
Southwest quarter of the Southwest quarter of the Southeast quarter of Southwest
quarter, Section 8; thence North 1 degree 35' East, 977.00 feet to U.S.-T.V.A.
Monument 54 at the northwest corner of the Southeast quarter of the SW 1/4
Section 8, thence North 35 degrees 59' West, 1633.00 feet to U.S.-T.V.A.
Monument 55 at the southeast corner of the Southwest quarter of the Southwest
quarter of Southwest quarter of Northwest quarter, Section 8; thence North 88
degrees 50' West, 332.00 feet to U.S.-T.V.A. Monument 56 at the southwest corner
of the Northwest quarter of Section 8; thence with the south line of the
Northeast quarter, Section 7 North 88 degrees 50' West, 330.00 feet to
U.S.-T.V.A. Monument 57; thence leaving the said South line, North 1 degree 23
minutes 15 seconds East, 1966.31 feet to U.S.-T.V.A. Monument 58; thence,
leaving the United States of America's boundary South 89 degrees 59 minutes 29
seconds East, 410 feet, passing a metal marker at 385.00 feet, to a point in the
423-foot contour on the shore of Pickwick Landing Lake; thence with the 423-foot
contour as it meanders in a southeasterly direction to a point; thence, leaving
the contour, South 61 degrees 19 minutes 05 seconds West, 534.50 feet, passing a
metal marker at 17 feet, to U.S.-T.V.A. Monument 49 in the south line of the
Northeast quarter of Section 17 and in the boundary of the United States of
America's land; thence with the United States of America's boundary and the
south line of the Northeast quarter of Section 17, North 89 degrees 19 minutes
West, 260.20 feet to U.S.-T.V.A. Monument 50; thence leaving the said south
line, North 0 degrees 24 minutes 16 seconds East, 420.42 feet to the point of
beginning.
PARCEL
III:
Commencing
at the Southwest corner of Section 18, T-3-S, R-13-W, Colbert County, Alabama,
thence North 0 degrees 48 minutes East along the West line of said Section 18 a
distance of 4085.36 feet to a point; thence North 89 degrees 58 minutes East a
distance of 2003.88 feet to a
Page
4 of 7
concrete
monument and the point of beginning of the tract herein described; thence North
0 degrees 02 minutes West a distance of 450.00 feet to a point on a chain link
fence; thence North 89 degrees 58 minutes East with chain link fence a distance
of 298.00 feet to a point; thence South 0 degrees 02 minutes East with chain
link fence a distance of 116.50 feet to a point; thence North 89 degrees 58
minutes East with chain link fence a distance of 52.00 feet to a point; thence
South 0 degrees 02 minutes East with chain link fence a distance of 333.50 feet
to a point; thence leaving said chain link fence South 89 degrees 58 minutes
West a distance of 2.0 feet to a concrete monument; thence continuing South 89
degrees 58 minutes West a distance of 348.00 feet to the concrete monument at
the point of beginning at the tract herein described.
PARCEL
VIII:
A parcel
of land lying in Section 00, Xxxxxxxx 0 Xxxxx, Xxxxx 13 West, Colbert County,
Alabama, and being more particularly described as follows: Commence
at the southwest corner of Section 00, Xxxxxxxx 0 xxxxx, Xxxxx 00 Xxxx, Xxxxxxx
Xxxxxx, Xxxxxxx; thence north 00 degrees 44 minutes 27 seconds west a distance
of 44.05 feet to a concrete monument on the north right-of-way of Xxxx Academy
Road; thence south 88 degrees 50 minutes 29 seconds east along the north
right-of-way of an unnamed County road a distance of 2,191.21 feet; thence south
89 degrees 04 minutes 39 seconds east a distance of 535.94 feet to the east
right-of-way of a County road and the POINT OF BEGINNING; thence north 12
degrees 05 minutes 42 seconds east a distance of 761.78 feet; thence south 70
degrees 57 minutes 14 seconds east a distance of 233.95 feet to a Point of
Curve; thence southeasterly along a curve concave north a distance of 638.62
feet (said curve having a radius of 2,025.00 feet, a chord bearing of south 79
degrees 59 minutes 24 seconds east, a chord distance of 635.97 feet) to the
Point of Tangency; thence south 89 degrees 01 minute 08 seconds east a distance
of 517.34 feet to a Point of Curve; thence southeasterly along said curve
concave southwesterly a distance of 566.33 feet (said curve having a radius of
950.00 feet, a chord bearing of south 71 degrees 56 minutes 27 seconds east, a
chord distance of 557.98 feet) to a Point of Reverse Curve; thence southwesterly
along a curve a distance of 108.67 feet (said curve concave northeasterly having
a chord bearing of south 25 degrees 43 minutes 19 seconds east, a chord distance
of 88.51 feet) to a point; thence south 00 degrees 41 minutes 33' west a
distance of 360.35 feet; thence north 89 degrees 04 minutes 24 seconds west a
distance of 1,995.46 feet; thence north 00 degrees 46 minutes 28 seconds east a
distance of 30.00 feet; thence north 88 degrees 59 minutes 48 seconds west a
distance of 94.09 feet to the POINT OF BEGINNING.
PARCEL
IX:
A parcel
of land lying in Section 17, Township 3 South, Range 13 West and being more
particularly described as follows: Commence at the southwest corner
of Section 00, Xxxxxxxx 0 xxxxx, Xxxxx 00 Xxxx, Xxxxxxx Xxxxxx, Xxxxxxx; thence
north 00 degrees 44 minutes 27 seconds west a distance of 44.05 feet to a
concrete monument on the north right-of-way of Xxxx Academy Road; thence south
88 degrees 50 minutes 29 seconds east along the north right-of-way of an unnamed
County road a distance of 2,191.21 feet; thence south 89 degrees 04 minutes 39
seconds east a distance of 535.94 feet to the east right-of-way of a County
Road; thence north 12 degrees 05 minutes 42 seconds east along said east
right-of-way a distance of 812.15 feet to the POINT OF BEGINNING; thence north
12 degrees 05 minutes 22 seconds east along said right-of-way a distance of
204.63 feet; thence north 01 degree 53 minutes 39 seconds east along said
Page
5 of 7
right-of-way
a distance of 310.69 feet; thence south 89 degrees 07 minutes 03 seconds east a
distance of 1,802.58 feet to T.V.A. Monument #48; thence south 42 degrees 56
minutes 26 seconds east a distance of 310.99 feet; thence south 56 degrees 00
minutes 16 seconds west a distance of 808.14 feet to a point of curve; thence
northwesterly along a curve concave southwesterly a distance of 43.45 feet (said
curve having a radius of 1,000.00 feet, a chord bearing of N 87 deg 46 min 18
sec West a arc length of 43.45 feet) to the point of tangency; thence north 89
degrees 01 minutes 16 seconds West a distance 516.26 feet to the Point of a
Curve; thence northwesterly along a curve concave north a distance of 622.86
feet (said curve having a radius of 1,975 feet, a chord bearing of North 79
degrees 59 minutes 24 seconds West, a chord distance of 620.28 feet) to the
Point of Tangency; thence North 70 degrees 57 minutes 14 seconds West a distance
of 240.04 feet to the POINT OF BEGINNING.
All the
foregoing being the same property conveyed by XxXxxxx Industries, Inc. to
Cherokee Nitrogen Company, by deed dated October 31, 2000, filed for record in
the Office of the Judge of Probate of Colbert County, Alabama, on November 7,
2000, at 1:37 p.m., and recorded on Microfiche 2000 25, Frames
133-141.
Less and
except therefrom property conveyed by Cherokee Nitrogen, Inc., to National
Telephone Company of Alabama, by corrective warranty deed dated April 2, 2001
and recorded on Fiche 2001 09 Frame 748, being more particularly described as
follows, to-wit:
Commence
at a cotton spindle on the SW corner of Section 00, X-0-X, X-00-X, Xxxxxxx
Xxxxxx, Xxxxxxx; then run S 89 degrees 14’ 26” E for 1397.26’ to a spike found;
then run N 0 degrees 21’ 39” E for 46.4’ to a 6” concrete monument, the point of
beginning; then run N 0 degrees 21’ 39” E for 50.0’ to an iron pin; then run S
89 degrees 14’ 26” E for 50.0’ to an iron pin; then run S 0 degrees 21’ 39” W
for 50.0’ to an iron pin; then run N 89 degrees 14’ 26” W for 50.0’ to the point
of beginning.
Non-Exclusive
Easement for Private Road
A fifty
(50) foot wide private road lying in Section 00, Xxxxxxxx 0 Xxxxx, Xxxxx 13
West, Colbert County, Alabama, and being more particularly described as follows:
Commence at the southwest corner of Section 00, Xxxxxxxx 0 Xxxxx, Xxxxx 00
Xxxx, Xxxxxxx Xxxxxx, Xxxxxxx, thence North 00 degrees 44 minutes 27 seconds
West a distance of 44.05 feet to a concrete monument on the northern
right-of-way margin of Xxxx Academy road; thence South 88 degrees 50 minutes 29
seconds East along the northern right-of-way margin of a gravel road a distance
of 2,191.21 feet; thence South 89 degrees 04 minutes 39 seconds East a distance
of 535.74 feet to the east right-of-way margin of a County Road; thence North 12
degrees 05 minutes 42 seconds East a distance of 761.78 feet to the POINT OF
BEGINNING; thence continue North 12 degrees 05 minutes 42 seconds East a
distance of 50.37 feet; thence South 70 degrees 57 minutes 14 seconds East a
distance of 240.04 feet to the P.C. of a curve; thence southeasterly a curve
concave northerly a distance of 622.86 feet (said curve having a radius of
1,975.00 feet, a chord distance of 620.28 feet, a chord bearing of South 79
degrees 59 minutes 24 seconds East) to the P.T. of said curve; thence South 89
degrees 01 minute 16 seconds East a distance of 516.26 feet to the P.C. of a
curve; thence southeasterly along a curve concave southwesterly a distance of
Page
6 of 7
648.77
feet (said curve having a radius of 1,000.00 feet, a chord distance of 637.45
feet, a chord bearing of South 70 degrees 26 minutes 42 seconds East) to the
P.T. of said curve and the P.C. of a cul-de-sac; thence easterly, southerly,
northwesterly along a curve (having a radius of 50.00 feet; a chord bearing of
South 82 degrees 09 minutes 16 seconds West, a chord distance of 70.63 feet) a
distance of 234.31 feet to the P.T. of said curve; thence northwesterly along a
curve concave southwest a distance of 566.33 feet (said curve having a radius of
950.00 feet, a chord bearing of North 71 degrees 56 minutes 27 seconds West, a
chord distance of 557.98 feet) to the P.T. of said curve; thence North 89
degrees 01 minute 08 seconds West a distance of 517.34 feet to the P.C. of a
curve; thence northwesterly along a curve concave northerly of 638.62 feet (said
curve having a radius of 2,025.00 feet, a chord distance of 635.97 feet, a chord
bearing of 79 degrees 59 minute 24 seconds west) to the P.T. of said curve,
thence North 70 degrees 57 minutes 14 seconds West) to the P.T. of said curve;
thence North 70 degrees 57 minutes 14 seconds West a distance of 233.95 feet to
the POINT OF BEGINNING.
Page 7 of
7
SCHEDULE
1.01(b)
LEGAL DESCRIPTION OF EL
DORADO SITE
The land
referred to herein below is all situated in Union County, Arkansas
Tract
1:
The South
Half of Section 6, and the North Half of Section 7, and the Northwest
Quarter of the Northwest Quarter of Section 8, all in Township 17
South, Range 15 West, and the following described tract:
Beginning
at the Northwest Corner of the Northeast Quarter of the Northwest Quarter of
Section 8, Township 17 South, Range 15 West;
thence
South along the West line of said Northeast Quarter of the Northwest Quarter of
Section 8 to the intersection with the South right-of-way line of the
access road as now located, said right-of-way line being 50 feet
perpendicular distance from the center line of said access
road;
thence in
a Northeasterly direction along said right-of-way line to the
intersection with the South line of the right-of-way of the railroad spur,
said right-of-way line for the railroad spur being 50 feet perpendicular
distance from the center line of said railroad spur;
thence
along said South right-of-way line for the railroad spur to a point which is
750 feet South of the North line of said Section 8;
thence
East along a line which is parallel to the North line of said Section 8,
and750 feet
distant therefrom to the intersection with the South right-of-way line for
the railroad spur herein above described;
thence in
a Southeasterly direction along the said South right-of-way line to the
intersection with the West right-of-way line of the
El Dorado-Smackover Highway;
thence in
a Northwesterly direction along the West right-of-way line of said
El Dorado-Smackover Highway to the North line of Section 0,
Xxxxxxxx 00 Xxxxx, Xxxxx 00Xxxx;
thence
West along the North line of said Section 9 and the North line of said
Section 8 to the POINT OF BEGINNING.
LESS
AND EXCEPT THE FOLLOWING TRACTS:
1. Commencing
at the Southeast Xxxxxx xx Xxxxxxx 0, Xxxxxxxx 00 Xxxxx, Xxxxx 15 West,
and
thence
run North 88 degrees 53 minutes 44 seconds West 1772.43 feet;
thence
North 01 degree 03 minutes 47 seconds East 576.89 feet for a POINT OF
BEGINNING;
thence
North 88 degrees 56 minutes 13 seconds West 134.0 feet;
thence
North 01 degree 03 minutes 47 seconds East
40.00 feet;
thence
North 88 degrees 56 minutes 13 seconds West
16.00 feet;
thence
North 01 degree 03 minutes 47 seconds East
40.0 feet;
thence
South 88 degrees 56 minutes 13 seconds East
150.00 feet;
thence
South 01 degree 03 minutes 47 seconds West 80.00 feet to the
POINT OF BEGINNING.
Page
1 of 12
AND
2. Commencing
at the Southeast Xxxxxx xx Xxxxxxx 0, Xxxxxxxx 00 Xxxxx, Xxxxx 15
West, run thence North 88 degrees 53 minutes 44 seconds West
2341.68 feet;
thence
North 01 degree 05 minutes 46 seconds East 545.52 feet for a
POINT OF BEGINNING;
thence
North 88 degrees 54 minutes 14 seconds West
240.00 feet;
thence
North 01 degree 05 minutes 46 seconds East
30.00 feet;
thence
North 88 degrees 54 minutes 14 seconds West
96.71 feet;
thence
North 01 degree 05 minutes 46 seconds East
118.10 feet;
thence
South 88 degrees 54 minutes 14 seconds East
336.71 feet;
thence
South 01 degree 05 minutes 46 seconds West
85.72 feet;
thence
South 88 degrees 54 minutes 14 seconds East
59.31 feet;
thence
South 01 degree 05 minutes 46 seconds West
40.58 feet;
thence
North 88 degrees 54 minutes 14 seconds West
59.31 feet;
thence
South 01 degree 05 minutes 46 seconds West 21.80 feet to the
POINT OF BEGINNING.
Tract
2:
Commencing
at the North Quarter Corner of Section 1, Township 17 South,
Range 16 West, thence South 88 degrees 46 minutes
East, 282.7 feet;
thence
South 01 degree 14 minutes West, 269.2 feet to the POINT OF
BEGINNING;
thence
South 88 degrees 46 minutes East, 150.0 feet;
thence
South 01 degree 14 minutes West, 150.0 feet;
thence
North 88 degrees 46 minutes West, 150.0 feet;
thence
North 01 degree 14 minutes East, 150.0 feet to the POINT OF
BEGINNING.
Tract
3:
Beginning
at the Southwest Corner of the Northeast Quarter of Section 31,
Township 16South, Range 15 West;
thence
North 00 degrees 07 minutes East 150 feet to a
stake;
thence
South 88 degrees 37 minutes East 150 feet to a
stake;
thence
South 00 degrees 07 minutes West 150 feet to a stake on South
line of the Northeast Quarter;
thence
North 88 degrees 37 minutes West 150 feet to POINT OF
BEGINNING.
Tract
4:
Beginning
at the Southeast Corner of the Southwest Quarter of Section 30,
Township 16 South, Range 15 West, at a iron pipe
Corner;
thence
North 88 degrees 38 minutes West 150 feet along the South line of
said Section 30 to a stake;
thence
North 00 degrees 07 minutes East 150 feet to a
stake;
thence
South 88 degrees 38 minutes East to a stake on the East line of said
Southwest Quarter;
thence
South 00 degrees 07 minutes West 150 feet to POINT OF
BEGINNING.
Page 2 of
12
Tract
5:
Commencing
at the Northwest Corner of the South Half of the Northeast Quarter of
Section 12, Township 17 South, Range 16 West;
thence
South 00 degrees 04 minutes East, 469.0 feet;
thence
North 53 degrees 09 minutes East, 126.45 feet;
thence
North 61 degrees 26 minutes East, 239.7 feet to the POINT OF
BEGINNING;
thence
North 00 degrees 04 minutes West, 118.7 feet;
thence
North 89 degrees 56 minutes East, 150.0 feet;
thence
South 00 degrees 04 minutes East, 150.0 feet;
thence
South 89 degrees 56 minutes West, 150.0 feet;
thence
North 00 degrees 04 minutes West, 31.3 feet to the POINT OF
BEGINNING.
Tract
6:
Beginning
at a point which is South 00 degrees 18 minutes East 223.2 feet
and North 89 degrees 42 minutes East 273.1 feet distance from the
Northwest Corner of the Southwest Quarter of Section 9, Township 17
South, Range 15 West;
thence
North 00 degrees 18 minutes West 150 feet;
thence
North 89 degrees 42 minutes East 150 feet;
thence
South 00 degrees 18 minutes East 150 feet;
thence
South 89 degrees 42 minutes West 150 feet to the POINT OF
BEGINNING.
Tract
7:
Beginning
at the Southwest Corner of the Southeast Quarter of Xxxxxxx 0,
Xxxxxxxx 00 Xxxxx, Xxxxx 00 Xxxx;
thence
North 150 feet along the West line of said Southeast Quarter to a
stake;
thence
South 88 degrees 56 minutes East 150 feet to a
stake;
thence
South 150 feet to a stake on South line of said
Section 2;
thence
North 88 degrees 56 minutes West 150 feet to POINT OF
BEGINNING.
Tract
8:
Beginning
at the Xxxxxxxxx Xxxxxx, Xxxxxxx 0, Xxxxxxxx 00 Xxxxx, Xxxxx 16
West;
thence
North along Section line 150 feet to a stake;
thence
South 88 degrees 56 minutes East 150 feet to a
stake;
thence
South 150 feet to a stake;
thence
North 88 degrees 56 minutes West 150 feet to POINT OF
BEGINNING.
Tract
9:
Commencing
at the Southwest Corner of the Southeast Quarter of Section 12,
Township 17 South, Range 16 West;
thence
North 00 degrees 04 minutes West, 276.7 feet;
thence
North 89 degrees 56 minutes East, 271.8 feet to the POINT OF
BEGINNING;
thence
North 00 degrees 04 minutes West, 150 feet;
thence
North 89 degrees 56 minutes East, 150 feet;
thence
South 00 degrees 04 minutes East, 150 feet;
thence
South 89 degrees 56 minutes West, 150 feet to the POINT OF
BEGINNING.
Page
3 of 12
Tract
10:
Commencing
at the Southwest Corner of Southeast Quarter of Xxxxxxx 0, Xxxxxxxx 00
Xxxxx, Xxxxx 00 Xxxx;
thence
South 88 degrees 25 minutes East 155.4 feet;
thence
North 01 degree 35 minutes East 308.5 feet to the POINT OF
BEGINNING;
thence
continuing North 01 degree 35 minutes East 150 feet;
thence
South 88 degrees 25 minutes East 150 feet;
thence
South 01 degree 35 minutes West 150 feet;
thence
North 88 degrees 25 minutes West 150 feet to the POINT OF
BEGINNING.
Tract
11:
Beginning
at the Northwest Corner of the Southeast Quarter, Section 18,
Township 17 South, Range 15 West;
thence
South 88 degrees 21 minutes East 150 feet along the North line of
the said Southeast Quarter to a stake;
thence
South 00 degrees 11 minutes East 150 feet to a
stake;
thence
North 88 degrees 21 minutes West 150 feet to a stake on the West
line of the said Southeast Quarter;
thence
North 00 degrees 11 minutes West 150 feet to the POINT OF
BEGINNING.
Tract
12:
Beginning
at a point on the West line of the Southeast Quarter of Section 18,
Township 17 South, Range 15 West, located North 00 degrees
11 minutes West 150 feet from the Southwest Corner of said Southeast
Quarter;
thence
North 00 degrees 11 minutes West 100 feet along the West line of
said Southeast Quarter to a stake;
thence
South 88 degrees 17 minutes East 150 feet to a
stake;
thence
South 00 degrees 11 minutes East 100 feet to a
stake;
thence
North 88 degrees 17 minutes West 150 feet to the POINT OF
BEGINNING.
Tract
15:
Beginning
at the Southeast Corner of Section 1, Township 17 South, Range 16
West;
thence
North 89 degrees 25 minutes West along the South line of said
Section 1, 4830.14 feet to POINT OF BEGINNING;
thence
North 00 degrees 04 minutes East 150 feet;
thence
North 89 degrees 25 minutes West 150 feet;
thence
South 00 degrees 04 minutes West 150 feet to the
intersection of South line of Section 1;
thence
South 89 degrees 25 minutes East along Section line 150 feet
to POINT OF BEGINNING.
Page 4 of
12
Tract
16:
Beginning
at a point 10.4 feet North of the Xxxxxxxxx Xxxxxx xx Xxxxxxx 0,
Xxxxxxxx 00Xxxxx, Xxxxx 15 West;
thence
East 29.5 feet;
thence
North 150.0 feet;
thence
West 29.5 feet;
thence
South 150.0 feet to the POINT OF BEGINNING.
Tract
17:
Beginning
at a point 70 yards North of the Southeast Corner of Section 1,
Township 17 South, Range 16 West;
thence
West 25.00 feet;
thence
South approximately 134.83 feet;
thence
East 25.00 feet;
thence
North to the PLACE OF BEGINNING.
The
exclusive right to produce water from any horizon lying under the following
described Tract 18 in Union County, Arkansas, at and below a depth of
350 feet below the surface:
Tract
18:
The East
Half of Section 1 and the East Half of Section 12, all in
Township 17 South, Range 16 West,
And
The South
Half of Section 7 and all of Section 8, all in Township 17 South,
Range 15 West,
And
All that
part of the West Half of the West Half of Section 9, Township 17
South, Range 15 West, lying West of the El Dorado-Smackover Highway
and all that part of the Southwest Quarter of the Southwest Quarter of
Section 4, Township 17 South, Range 15 West, lying West of the
El Dorado-Smackover Highway and all of Section 5 and the North Half of
Section 6, all in Township 17 South, Range 15 West, EXCEPT the following described
tracts, lettered (a) through (k), both inclusive, to-wit:
(a) The
Northwest Quarter of the Northwest Quarter of Xxxxxxx 0, Xxxxxxxx 00
Xxxxx, Xxxxx 00 Xxxx.
(x)
Beginning at the Northwest Corner of the Northeast Quarter of the Northwest
Quarter of Section 8, Township 17 South, Range 15
West;
thence
South along the West line of said Northeast Quarter of the Northwest Quarter of
said Section 8 to the intersection with the South right-of-way line of
the Access Road as now located, said right-of-way line being 50 feet
perpendicular distance from the center line of said Access Road;
Page
5 of 12
thence in
a Northeasterly direction along said right-of-way line to the
intersection with the South line of the right-of-way of the railroad spur,
said right-of-way line for the railroad spur being 50 feet perpendicular
distance from the center line of said railroad spur;
thence
along said South right-of-way line for the railroad spur to a point which is
750 feet South of the North line of said Section 8;
thence
East along a line which is parallel to the North line of said Section 8,
and 750 feet distant therefrom, to the intersection with the South
right-of-way line for the railroad spur hereinabove
described;
thence in
a Southeasterly direction along the said South right-of-way line to the
intersection with the West right-of-way line of the
El Dorado-Smackover Highway;
thence in
a Northwesterly direction along the West right-of-way line of said
El Dorado-Smackover Highway to the North line of Xxxxxxx 0,
Xxxxxxxx 00 Xxxxx, Xxxxx 00 Xxxx;
thence
West along the North line of said Section 9 and the North line of said
Section 8 to the POINT OF BEGINNING.
(c) Commencing
at the Northwest Corner of Section 5, Township 17 South, Range 15
West;
thence
South 88 degrees 24 minutes East 4060.30 feet to the POINT OF
BEGINNING of this excepted tract;
thence
South 00 degrees 40 minutes West 1213.20 feet;
thence
South 88 degrees 10 minutes East 1200.33 feet to the
El Dorado-Smackover Highway;
thence in
a Northwesterly direction along said Highway to the North line of said
Section 5;
thence in
a Westerly direction to the POINT OF BEGINNING.
(d) Commencing
at the Northeast Corner of Section 6, Township 17 South, Range 15
West;
thence
North 88 degrees 23 minutes West 1327 feet to the POINT OF
BEGINNING of this excepted tract;
thence
South 01 degree 37 minutes West 90 feet;
thence
North 88 degrees 23 minutes West 990 feet;
thence
North 01 degree 37 minutes East 90 feet;
thence
South 88 degrees 23 minutes East 990 feet to the POINT OF
BEGINNING.
(e) Tract
2 described above.
(f) Tract
5 described above.
(g) Tract
6 described above.
(h) Tract
9 described above.
(i) Tract
10 described above.
(j) Tract
16 described above.
(k) Tract
17 described above.
TOGETHER WITH all of the
rights of the United States of America as granted to Lion Oil Company in an
instrument entitled “Quitclaim Deed, Assignment and Xxxx of Sale” which was
filed March 5, 1948 in Record Book 511, Page 405 to maintain,
repair, replace and operate each electrical transmission line, telephone line,
water line gas line, sanitary sewer, drainage sewer,
Page
6 of 12
drainage
ditch, road, trail or railroad upon any of the land which constitutes a part of
Tract 18 described above or which leads from Tract 18 described above to Tracts
3, 4, 7, 8, 11, 12 and 15 described above, and the right-of-way in connection
therewith, all as is more fully set forth in said Quitclaim Deed, Assignment and
Xxxx of Sale.
TOGETHER WITH such water
rights as were reserved by Monsanto Company in a Quitclaim Deed in favor of
X. X. Xxx which was filed February 23, 1981 in Record Book 1459,
Page 601, of the Union County Deed Records describing the following
tract:
Beginning
at the Southwest Corner of the Southwest Quarter of the Southeast Quarter of
Section 8, Township 17 South, Range 15 West;
thence
North 417.4 feet;
thence
East 417.4 feet;
thence
South 417.4 feet;
thence
West 417.4 feet to the POINT OF BEGINNING.
ALSO
Commencing
at the Southeast Corner of the Southeast Quarter of the Southwest Quarter of
Section 8, Township 17 South, Range 15 West;
thence
North 01 degree 06 minutes East 274.0 feet to the POINT OF
BEGINNING;
thence
North 88 degrees 54 minutes West 69.8 feet;
thence
North 01 degree 06 minutes East 150.0 feet;
thence
South 88 degrees 54 minutes East 69.8 feet;
thence
South 01 degree 06 minutes West 150.0 feet to the POINT OF
BEGINNING.
TOGETHER WITH such water
rights as were reserved in a Quitclaim Deed in favor of Xxxxx Xxxx White et al
which was filed September 10, 1982 in Record Book 1521, Page 257, in
the Union County Deed Records describing the following tract:
Beginning
at the Southwest Corner of the Southwest Quarter of the Northwest Quarter of
Section 9, Township 17 South, Range 15 West;
and run
North 00 degrees 38 minutes East 1729.4 feet to the South
right-of-way line of the Missouri-Pacific Railroad;
thence in
a Southeasterly direction along said right-of-way for 547.8 feet to the
Xxxx xxxx xx Xxxxxxx Xx. 0X;
thence
South 08 degrees 29 minutes East along said line
21.8 feet;
thence
South 05 degrees 24 minutes East along said line
1444.0 feet;
thence
South 02 degrees 50 minutes East along said line
96.57 feet;
thence
North 88 degrees 14 minutes West 675.4 feet to the POINT OF
BEGINNING.
Page 7 of
12
Tract
41-1 (25):
The West
Half of the Southeast Quarter of the Southeast Quarter and the Northeast Quarter
of the Southeast Quarter of Section 7, and the Southwest Quarter of the
Northwest Quarter of Section 8, all in Township 17 South,
Range 15 West, Union County, Arkansas, EXCEPTING THE FOLLOWING DESCRIBED
TRACT:
Beginning
at a point 600.0 feet North of the Northwest Corner of the Southwest
Quarter of said Section 8;
thence
North 435.6 feet;
thence
East 100.0 feet;
thence
South 435.6 feet;
thence
West 100.0 feet to the POINT OF BEGINNING.
Tract
41-2 (20):
The North
Three-Quarters of the North Half of the Northwest Quarter of the Southeast
Quarter (N 3/4 N/2 NW/4 SE/4) of Section 7, Township 17 South,
Range 15 West, LESS
three (3) acres in the form of a square in the Northeast Corner
thereof.
Tract
41-4 (22):
Three
acres in the form of a square out of the Northeast Corner of the Northwest
Quarter of the Southeast Quarter of Section 7, Township 17 South,
Range 15 West of the Fifth Principal Meridian.
(Same
Property as the exception in 41-2 (20) above)
Tract
41-4 (23):
Beginning
at a point 600 feet North of the Southwest Corner of the Southwest Quarter
of the Northwest Quarter of Section 8, Township 17 South,
Range 15 West of the Fifth Principal Meridian;
thence
East 100.0 feet;
thence
North 435.6 feet;
thence
West 100.0 feet;
thence
South 435.6 feet to the PLACE OF BEGINNING.
(Same
Property as the exception in 41-1 (25) above)
Tract
41-4 (24):
A part of
the Southwest Quarter of the Southeast Quarter of Section 8,
Township 17 South, Range 15 West of the Fifth Principal Meridian,
described as follows:
Beginning
at a point 417.4 feet North of the Southwest Corner of the said Southwest
Quarter of the Southeast Quarter of Section 8 and running thence North
208.71 feet;
thence
East 208.71 feet;
thence
South 208.71 feet;
thence
West 208.71 feet to the PLACE OF BEGINNING,
Page
8 of 12
EXCEPT that part of the
Southwest Quarter of the Southeast Quarter of Section 8 contained within
the following parcel of land, described as:
Commencing
at the Southwest Corner of said Southwest Quarter of the Southeast Quarter of
said Section 8;
thence
South 88 degrees 54 minutes East, 80.2 feet;
thence
North 01 degree 06 minutes East, 274.0 feet to the POINT OF
BEGINNING of said parcel;
thence
North 88 degrees 54 minutes West, 150.0 feet;
thence
North 01 degree 06 minutes East, 150.0 feet;
thence
South 88 degrees 54 minutes East, 150.0 feet;
thence
South 01 degree 06 minutes West, 150.0 feet to the POINT OF
BEGINNING.
Tract
41-5 (19):
The South
Five-Eighths of the Northwest Quarter of the Southeast Quarter and the North
Three-Eighths of the Southwest Quarter of the Southeast Quarter of
Section 7, Township 17 South, Range 15 West of the Fifth
Principal Meridian.
Tract
41-7:
The
Southwest Quarter of the Northeast Quarter and the Southeast Quarter of the
Northwest Quarter of Section 0, Xxxxxxxx 00 Xxxxx, Xxxxx 00 Xxxx,
Xxxxx Xxxxxx, Xxxxxxxx.
Tract
41-9:
The
Northwest Quarter of the Southwest Quarter of Section 5, Township 17
South, Range 15 West,
AND
The East
Half of the Northeast Quarter of Section 6, Township 17 South,
Range 15 West.
Tract
41-10:
The
Northwest Quarter of the Northeast Quarter of Section 0, Xxxxxxxx 00
Xxxxx, Xxxxx 00 Xxxx, Xxxxx Xxxxxx, Xxxxxxxx, LESS AND EXCEPT the following
tract:
Commencing
at the Northeast Corner of the Northwest Quarter of the Northeast Quarter of
Section 6, Township 17 South, Range 15 West, and run thence South
90 feet;
thence
West 990 feet;
thence
North 90 feet;
thence
East 990 feet to the POINT OF BEGINNING.
Tract
41-11:
The
Southeast Quarter of the Northeast Quarter of Section 1, Township 17
South, Range 16 West,
ALSO
The
Southwest Quarter of the Northwest Quarter of Section 6, Township 17
South, Range 15 West,
Page
9 of 12
LESS
AND EXCEPT THE FOLLOWING TRACTS:
1. All that
part of the Southeast Quarter of the Northeast Quarter (SE/4 NE/4) of
Xxxxxxx 0, Xxxxxxxx 00 Xxxxx, Xxxxx 00 Xxxx, Xxxxx Xxxxxx,
Xxxxxxxx, lying North and West of Arkansas State Highway
#335,
2. All that
part of the Southwest Quarter of the Northwest Quarter (SW/4 NW/4) of
Xxxxxxx 0, Xxxxxxxx 00 Xxxxx, Xxxxx 00 Xxxx, Xxxxx Xxxxxx,
Xxxxxxxx, lying North and Xxxx xx Xxxxxxxx Xxxxx Xxxxxxx #000.
Tract
41-12:
The East
Quarter of the Southwest Quarter of the Southeast Quarter of Section 1,
Township 17 South, Range 16 West
AND
the
Southeast Quarter of the Southeast Quarter of Section 1 Township 17
South, Range 16 West of the Fifth Principal Meridian, LESS THE FOLLOWING
TRACTS:
1. A
tract described as:
Commencing
70 yards North of the Southeast Corner of the Southeast Quarter of the Southeast
Quarter of Section 1, Township 17 South, Range 16 West, as a
BEGINNING POINT;
thence
South 70 yards;
thence
West 330 yards;
thence
North 61.5 yards;
thence in
a straight line to a POINT OF BEGINNING.
2. A
tract described as:
Beginning
at a point 70 yards North of the Southeast Corner of Section 1,
Township 17 South, Range 16 West;
thence
North 15.17 feet;
thence
West 25.00 feet;
thence
South 15.17 feet;
thence
East to the POINT OF BEGINNING.
3. A
tract described as:
Commencing
at the Southeast Corner (XXXxx) of Xxxxxxx 0, Xxxxxxxx 00 Xxxxx,
Xxxxx 00 Xxxx, Xxxxx Xxxxxx, Xxxxxxxx, and run North 89 degrees
24 minutes 22 seconds West along the South line of said Section 1
a distance of 1172.08 feet, more or less, to the center line of a county
road for the point of beginning;
thence
run North 33 degrees 28 minutes 58 seconds East
432.00 feet;
thence
North 89 degrees 21 minutes 48 seconds West
715.87 feet;
thence
South 00 degrees 16 minutes 35 seconds West 363.30 feet to
the South line of Section 1;
thence
South 89 degrees 24 minutes 22 seconds East 479.28 feet to
the point of beginning.
Page 10 of
12
4. (Monsanto
to Xxxxxxx)
Commencing
at the Southeast Xxxxxx xx Xxxxxxx 0, Xxxxxxxx 00 Xxxxx, Xxxxx 16
West, and run North 89 degrees 25 minutes West
400.0 feet;
thence
North 00 degrees 15 minutes East 199.7 feet to the POINT OF
BEGINNING;
thence
North 00 degrees 15 minutes East 150.9 feet;
thence
North 89 degrees 25 minutes West 543.7 feet to the center of
State Highway No. 335;
thence
South 33 degrees 55 minutes West along said Highway for
422.4 feet;
thence
South 89 degrees 25 minutes East 184.0 feet;
thence
North 00 degrees 15 minutes East 184.5 feet;
thence
North 89 degrees 00 minutes East 593.5 feet to the POINT OF
BEGINNING.
5. (Monsanto
to Xxxxx)
Commencing
at the Southeast Xxxxxx xx Xxxxxxx 0, Xxxxxxxx 00 Xxxxx, Xxxxx 16
West, and run North 89 degrees 25 minutes West
400.0 feet;
thence
run North 00 degrees 15 minutes East 350.6 feet to the POINT OF
BEGINNING;
thence
run North 00 degrees 15 minutes East 819.7 feet to the center of
Xxxxx Xxxxxxx Xx. 000;
thence
run South 33 degrees 55 minutes West along said Highway for
979.8 feet;
thence
run South 89 degrees 25 minutes East 543.7 feet to the POINT OF
BEGINNING.
6. (NWF
to Xxxx Timber)
The East
Quarter of the Southwest Quarter of the Southeast Quarter
(E/4 SW/4 SE/4) and all that part of the Southeast Quarter of the
Southeast Quarter (SE/4 SE/4) of Xxxxxxx 0, Xxxxxxxx 00 Xxxxx,
Xxxxx 00 Xxxx, Xxxxx Xxxxxx, Xxxxxxxx, lying Xxxx xx Xxxxxxxx Xxxxx Xxxxxxx
#000.
Tract
41-12A:
1. (Xxxxxxx
to Monsanto)
Beginning
at the Northeast Corner (NECor) of Section 00, Xxxxxxxx 00 Xxxxx,
Xxxxx 00 Xxxx, Xxxxx Xxxxxx, Xxxxxxxx, and run South 00 degrees
15 minutes West 330.0 feet;
thence
North 89 degrees 25 minutes West 400.0 feet;
thence
North 00 degrees 15 minutes East 529.7 feet;
thence
North 89 degrees 00 minutes East 375.0 feet;
thence
South 00 degrees 15 minutes West 134.85 feet;
thence
South 89 degrees 25 minutes East 25.0 feet;
thence
South 00 degrees 15 minutes West 75.05 feet to the POINT OF
BEGINNING, and being part of the Southeast Quarter of the Southeast Quarter
(SE/4 SE/4) of Section 1, and part of the Northeast Quarter of the
Northeast Quarter (NE/4 NE/4) of Section 12, all in Township 17 South,
Range 16 West.
Page 11 of
12
2. (Xxxxx
to Monsanto)
Beginning
at the Southeast Corner of the Northeast Quarter of the Northeast Quarter (XXXxx
NE/4 NE/4) of Section 00, Xxxxxxxx 00 Xxxxx, Xxxxx 00 Xxxx, Xxxxx
Xxxxxx, Xxxxxxxx, and run North 89 degrees 25 minutes West
400.0 feet;
thence
North 00 degrees 15 minutes East 990.0 feet;
thence
South 89 degrees 25 minutes East 400.0 feet;
thence
South 00 degrees 15 minutes West 990.0 feet to the POINT OF
BEGINNING.
Tract
41-16:
The North
Half of the Southwest Quarter of Section 0, Xxxxxxxx 00 Xxxxx,
Xxxxx 00 Xxxx, Xxxxx Xxxxxx, Xxxxxxxx.
Tract
41-17:
The
Northwest Quarter of the Southwest Quarter of Section 0, Xxxxxxxx 00
Xxxxx, Xxxxx 00 Xxxx, Xxxxx Xxxxxx, Xxxxxxxx.
Tract
41-18:
The
Southwest Quarter of the Southwest Quarter (SW1/4 SW 1/4) and the West Half of
the Southeast Quarter of the Southwest Quarter (W1/2 SE1/4 SW1/4) of
Xxxxxxx 0, Xxxxxxxx 00 Xxxxx, Xxxxx 15 West, Union County,
Arkansas
AND
Beginning
at the Northeast Corner of the Southeast Quarter of the Southwest Quarter (SE1/4
SW1/4) of Xxxxxxx 0, Xxxxxxxx 00 Xxxxx, Xxxxx 00 Xxxx, Xxxxx
Xxxxxx, Xxxxxxxx, and run North 88 degrees 53 minutes West
695.0 feet;
thence
South 00 degrees 11 minutes West 1326.0 feet to the South line of
said forty;
thence
South 88 degrees 53 minutes East along said South line
347.5 feet;
thence
North 00 degrees 11 minutes East 1290.4 feet;
thence
South 88 degrees 53 minutes East 347.5 feet;
thence
North 00 degrees 11 minutes East 26.0 feet to the POINT OF
BEGINNING.
Railroad
Right-of-Way:
Railroad
right-of-way extending 50 feet on each side of the centerline of the
railroad track as the same is now located, on, over and across the North Half of
Section 8, the North Half of Section 9, and the North Half of
Section 10, all in Township 17 South, Range 15 West.
Page 12 of
12
SCHEDULE
1.01(c)
FACILITY
ASSETS
Part A – Cherokee
Facility
The major
personal property assets identified at this facility include a concrete dome
xxxxx storage facility with a storage capacity of 14,000 tons; a Xxxxxxx Company
ammonia processing plant, 500 tons per day (“TPD”) rated capacity; a Chemical
Industrial Engineers Company nitric acid plant #1, 300 TPD rated capacity; a
X.X. Xxxxxxxxx Company nitric acid plant #2, 500 TPD rated capacity; ammonium
nitrate solution neutralizers; UAN production equipment; a Technip Company urea
plant, 600 TPD rated capacity; a pollution control and irrigation system;
cooling towers; a de-mineralizer; barge unloading equipment and storage tanks;
forklift trucks; an auxiliary boiler; a de-aerator system; product storage
tanks; air compressors; an electrical substation and transformers; and process
plant piping, pumps and wiring.
Part B – El Dorado
Facility
The major
personal property assets identified at this facility include 2 Chemico weak
nitric acid plants, 785 TPD combined rated capacity; a Chemico sulfuric acid
plant, 360 TPD rated capacity; an E2 high-density ammonium nitrate xxxxx plant,
1,100 TPD rated capacity; a K-T lo-density ammonium nitrate xxxxx plant, 700 TPD
rated capacity; a 100 TPD mixed acids plant, a X.X. Xxxxxxxxx nitric acid plant,
350 TPD rated capacity; a CB&I tank farm, including ten ammonia storage
spheres, a refrigerated ammonia tank, and six ammonia storage tanks; a plant
steam generation system, including two Xxxxxxx & Xxxxxx processing boilers;
a plant electrical generation system, including substations and transformers;
maintenance and machine shop equipment; a wastewater pH neutralization system; a
pollution control and irrigation system; cooling towers; forklift trucks; air
compressors; and process plant piping, pumps and wiring.
Schedule
1.01(d)
Lenders
and Lending Offices
Banc of
America Leasing & Capital LLC
Mail
Code: GA3-003-04-01
NORTHEAST
CENTER BUILDING
0000
XXXXXXXXX XXXX
XXXXXX XX
00000-0000
Attn: Xxxxxxx
X. XxXxxxxx, Vice President - Operations Manager
Tel: 000-000-0000
Fax: 000-000-0000
With
a copy to:
Banc of
American Leasing & Capital LLC
Xxx
Xxxxxxxxx Xxxxx, 0xx
Xxxxx
Mail
Code: R11-537-02-01
xxxx://xxxxxxx.xxxxxxxxxxxxx.xxx/xxxxxxxxxxxx.xxx?xxxXxxxx0Xxxxxxxxxxxxx&xxxXxxxx0Xxxxxxx&xxxXxxxx0X
Xxxxxxxxxx,
XX 00000
Attn: Xxx
Xxxxxxx
Vice
President - Credit Underwriting
Tel:
000-000-0000
Fax:
000-000-0000
And
a copy to:
Banc of
America Leasing & Capital LLC
Xxxxxxxxx
X. Xxxxxx
Vice
President - Group Operations Manager
Banc of
America Leasing
Mail
Code: MA5-100-32-01
000
XXXXXXX XX
XXXXXX XX
00000
Tel: 000-000-0000
Fax: 000-000-0000
Xxxxxxx
Xxxxx Capital, a Division of Xxxxxxx Xxxxx Business Financial Services
Inc.
000 X.
XxXxxxx Xxxxxx, 00xx
Xxxxx
Xxxxxxx,
XX 00000
Attention: Xxxx
Xxxxxxx, Vice President, Group Credit Manager
Tel: 000-000-0000
Fax: 000-000-0000
Email: Xxxx_Xxxxxxx@xx.xxx
- 1
-
Arvest
Bank
0000 X.
Xxxxxxx Xxxxxxxxx
Xxxxxxxx
Xxxx, XX 00000
Attn: Xxxxx
Xxxx, Xx. Vice President & Corporate Division Manager
Tel: 000-000-0000
Fax: 000-000-0000
Email: xxxxx@xxxxxx.xxx
Bank of
Utah, as Payment Agent
ATTN: Corporate
Trust Services
000 X.
Xxxxx Xxxxxx, Xxxxx 000
Xxxx Xxxx
Xxxx, XX 00000
Phone: (000)
000-0000
Fax: (000)
000-0000
- 2
-
Schedule
2.01
Commitments
and Applicable Percentages
As a % of Total
Commitment
Allocation: Commitment
Amounts Amounts
Banc of
America Leasing & Capital,
LLC $10,000,000.00 20.00%
Banc of
America Leasing & Capital,
LLC $ 5,000,000.00 10.00%
Banc of
America Leasing & Capital,
LLC $ 5,000,000.00 10.00%
Arvest
Bank $15,000,000.00 30.00%
Xxxxxxx
Xxxxx Capital, a Division of Xxxxxxx
Xxxxx
Business Financial Services
Inc.
$15,000,000.00 30.00%
______________________________________________________
Total
Commitment
Amount: $50,000,000.00 100.00%
SCHEDULE
4.01(a)(iii)
FINANCING
STATEMENTS
|
1.
|
Cherokee
Mortgage filed in the real property records of the Probate Office (County
Clerk) of Colbert County, Alabama.
|
|
2.
|
Financing
Statement filed in the Probate Office (County Clerk) of Colbert County,
Alabama naming Collateral Agent, as secured party, and Cherokee Nitrogen
Company (“CNC”) and Cherokee Nitrogen Holdings, Inc. (“CNH”), as debtors,
covering the Collateral with respect to CNC and
CNH.
|
|
3.
|
Financing
Statement filed in the Office of the County Clerk of Oklahoma County,
Oklahoma naming Collateral Agent, as secured party, and CNH, Northwest
Financial Corporation (“NWF”), CNC, DSN Corporation (“DSN”) and El Dorado
Chemical Company (“EDC”), as debtors, covering the Collateral with respect
to CNH, NWF, CNC, DSN and EDC.
|
|
4.
|
El
Dorado Mortgage filed in the real property records of the Office of the
Circuit Clerk and Ex-Officio Recorder of Union County,
Arkansas.
|
|
5.
|
Financing
Statement filed in the Office of the Circuit Clerk and Ex-Officio Recorder
of Union County, Arkansas, naming Collateral Agent, as secured party, and
NWF, EDC, and DSN, as debtors, covering the Collateral with respect to
NWF, EDC and DSN.
|
|
6.
|
Trademark
Security Agreement filed in the United States Patent and Trademark Office
made by EDC in favor of Collateral Agent covering the trademarks owned by
EDC.
|
Page 1 of
1
SCHEDULE
4.01(a)(iv)
LEASED
PROPERTY
None
SCHEDULE
5.03
GOVERNMENT AUTHORIZATIONS
AND OTHER CONSENTS
|
1.
|
Filing
of UCC-1 Financing Statements, Mortgages, and Trademark Security Agreement
referenced on Schedule
4.01(a)(iii).
|
|
2.
|
Consent
of Xxxxx Fargo Foothill, Inc. and Persons party to the Assigned
Agreements.
|
|
3.
|
Filing
of UCC-3 Continuation
Statements.
|
SCHEDULE
5.05
INDEBTEDNESS
(as
of September 30, 2007)
Long Term
Debt
|
1.
|
El
Dorado Chemical Company (“EDC”) is indebted to the
following:
|
|
a.
|
ThermaClime,
Inc. (“TCI”) in the principal amount of
$35,593,138.
|
|
b.
|
LSB
Chemical Corp. (“LSB Chemical”) in the principal amount of
$2,098,787.
|
|
2.
|
Trison
Construction, Inc. (“Trison”) is indebted to TCI in the principal amount
of $6,364,700 less $2,500,0001.
|
|
3.
|
International
Environmental Corporation (“IEC”) is indebted to the
following:
|
|
a.
|
Xxxxx
Capital Corporation in the amount of
$57,714.
|
|
b.
|
ThermaClime
Technologies, Inc. (“TTI”) in the principal amount of
$779,221.
|
|
4.
|
ClimateCraft,
Inc. (“CLC”) is indebted to the
following:
|
|
a.
|
The
City of Oklahoma City in the amount of
$2,450,000.
|
|
b.
|
TCI
in the principal amount of $6,947,768 less $5,200,0001.
|
|
c.
|
Summit
Machine Tool Manufacturing Corp. in the principal amount of
$715,719.
|
|
5.
|
TCI
is indebted to the following:
|
|
a.
|
IEC
in the principal amount of
$76,297,857.
|
|
b.
|
The
Climate Control Group, Inc. (“CCG”) in the principal amount of
$3,104,268.
|
|
c.
|
Climate
Master, Inc. (“CLM”) in the principal amount of
$40,537,986.
|
|
d.
|
Koax
Corp. (“Koax”) in the principal amount of
$22,811,075.
|
|
e.
|
Chemex
I Corp. (“Chemex I”) in the principal amount of
$276,944.
|
|
f.
|
Chemex
II Corp. (“Chemex II”) in the principal amount of
$1,484,718.
|
|
g.
|
Northwest
Financial Corporation in the principal amount of
$13,328,828.
|
|
h.
|
CEPOLK
Holdings, Inc. in the principal amount of
$3,898,523.
|
|
i.
|
El
Dorado Nitrogen, L.P. in the principal amount of
$25,734,720.
|
|
j.
|
LSB
Industries, Inc. (“LSB”) in the principal amount of $36,287,224 and
$962,398 in interest.
|
|
k.
|
Holders
(LSB) of 10-3/4% Senior Unsecured Notes due 2007 in the principal amount
of $6,950,000.
|
|
6.
|
Cherokee
Nitrogen Company (“CNC”) is indebted to the following
companies:
|
|
a.
|
TCI
in the principal amount of
$10,604,163.
|
|
b.
|
EDC
in the principal amount of
$2,438,209.
|
Page 1 of
3
|
7.
|
LSB
Chemical is indebted to the following
companies:
|
|
a.
|
TCI
in the principal amount of $24,187,624 plus $4,500,0001 .
|
|
b.
|
DSN
Corporation (“DSN”) in the principal amount of
$275,773.
|
|
8.
|
DSN
is indebted to TCI in the principal amount of $18,784,414 less
$4,500,0001.
|
|
9.
|
XpediAir,
Inc. (“XPA”) is indebted to TCI in the principal amount of $1,768,968 less
$1,900,0001.
|
|
10.
|
CCG
is indebted to LSB in the principal amount of
$228,321.
|
|
11.
|
TTI
is indebted to TCI in the principal amount of $3,548,796 less
$2,700,0001.
|
|
12.
|
ClimaCool
Corp. (“CCC”) is indebted to TCI in the principal amount of $3,450,175
less $2,300,0001.
|
|
13.
|
Chemex
I is indebted to the following
companies:
|
|
(a)
|
LSB
Chemical in the principal amount of $385,282 less $150,0001.
|
|
(b)
|
Chemex
II in the principal amount of $348.
|
|
14.
|
Cherokee
Nitrogen Holdings, Inc. is indebted to LSB in the principal amount of
$61,899,327.
|
Accrued
Liabilities
|
15.
|
TCI
has accrued $1,940,175 for payroll, taxes, insurance other
expenses.
|
|
16.
|
IEC
has accrued $4,247,406 for payroll, taxes and other
expenses.
|
|
17.
|
TTI
has accrued $245,358 for payroll, taxes and other
expenses.
|
|
18.
|
Koax
has accrued $125,735 for payroll, taxes and other
expenses.
|
|
19.
|
CLM
has accrued $ 10,231,111 for payroll, taxes and other
expenses.
|
|
20.
|
CLC
has accrued $ 1,143,698 for payroll, taxes and other
expenses.
|
|
21.
|
XPA
has accrued $66,966 for payroll, taxes and other
expenses.
|
|
22.
|
Trison
has accrued $105,893 for payroll, taxes and other
expenses.
|
|
23.
|
CCC
has accrued $408,394 for payroll, taxes and other
expenses.
|
|
24.
|
LSB
Chemical has accrued $33,737 for payroll, taxes and other
expenses.
|
|
25.
|
EDC
has accrued $3,284,122 for payroll, taxes and other
expenses.
|
|
26.
|
Chemex
I $492,052 for payroll, taxes and other
expenses.
|
|
27.
|
CNC
has $466,714 for payroll, taxes and other
expenses.
|
Accounts
Payable
|
28.
|
TCI
has accounts payable in the amount of
$457,490.
|
|
29.
|
CLM
has accounts payable in the amount of
$10,393,220.
|
|
30.
|
IEC
has accounts payable in the amount of
$5,951,735.
|
|
31.
|
TTI
has accounts payable in the amount of
$1,686,575.
|
|
32.
|
CLC
has accounts payable in the amount of
$947,479.
|
|
33.
|
Trison
has accounts payable in the amount of
$495,550.
|
|
34.
|
Koax
has accounts payable in the amount of
$254,471.
|
|
35.
|
LSB
Chemical has accounts payable in the amount of
$31,429.
|
|
34.
|
EDC
has accounts payable in the amount of
$8,929,336.
|
|
35.
|
CNC
has accounts payable in the amount of
$3,821,811.
|
Page 3 of
3
SCHEDULE
5.06
LITIGATION
Xxxxx Wetheral v. Climate
Master. On September 14, 2007 Climate Master, Inc. (“Climate
Master”) was served with the complaint filed in this litigation with the Circuit
Court of Xxxxxxx County, Illinois. Plaintiff sues in its individual
capacity and as a class action representative stating that Climate Master now
offers a coated coil option for its evaporator coils to protect its evaporator
coils from corrosion from airborne chemicals resulting from modern building
material out gassing and most airborne environmental
chemicals. Plaintiff asserts that it was well known in the industry
that a coating was necessary to prevent failure of evaporator coils, that
Climate Master was aware of the need to coat its coils since the mid-1990s, and
that Climate Master sold untreated coils to thousands of consumers, including
the Plaintiff, despite knowledge that they were defective and failing without
the coating. Plaintiff asserts itself as a representative of a class
consisting of, “all consumers who purchased heating and cooling systems sold or
installed in Illinois, with evaporator coils manufactured by Climate Master,
Inc. prior to Climate Master’s utilization of their new E-coated
technology”. Plaintiff asserts claims against Climate Master based
upon negligence and strict liability. As these claims arise in tort,
Climate Master intends to place its applicable insurance carriers on notice of
this claim. Insurance coverage on this matter is unknown at this
time.
Climate Master advises that there has
been an industry wide issue related to coil failures. The research of
others appears to link coil failures to formicary corrosion that is suspected of
being the result of environmental airborne materials. Although the
occurrence of such failures is low nationwide, such research indicates that
unexplainable failures seem to occur more frequently in some geographical areas
and that the failure appear to occur after one to four years of installation and
use. Climate Master, like other manufacturers, began to experience
certain coil failures (many times concentrated in a particular geographic area)
which began to appear to be the result of formicary corrosion. In an
effort to minimize any formicary corrosion issues, Climate Master began offering
its E-coating as a standard part of its offering of residential products in
June, 2003. In April, 2004, the coating was made standard on Climate
Masters vertical stack commercial products and as an option on all its other
commercial products, except Climate Master’s commercial roof top series of
products. In March, 2006, Climate Master then began offering a
non-coated option for its vertical stack commercial products. Not all
HVAC manufacturer’s have decided even to offer coated coils. While
Climate Master has continued to experience some coil failures of coated coils,
the incidences appear to have declined in number for the coated
coils.
SCHEDULE
5.09
ENVIRONMENTAL
MATTERS
|
A.
|
ITEMS
DISCUSSED IN PARENT’S FORM 10Q FOR THE PERIOD ENDING JUNE 30,
0000
|
Xx Xxxxxx Chemical Company -
Discharge Water Matters. The El Dorado Facility within our
Chemical Business generates process wastewater. The process water discharge and
storm-water run off are governed by a state National Pollutant Discharge
Elimination System (“NPDES”) water discharge permit issued by the Arkansas
Department of Environmental Quality (“ADEQ”), which permit is to be renewed
every five years. The ADEQ issued to the El Dorado Facility a NPDES water
discharge permit in 2004, and the El Dorado Facility had until June 1, 2007 to
meet the compliance deadline for the more restrictive limits under the 2004
NPDES permit. In order to meet the El Dorado Facility’s June 2007 limits, the El
Dorado Facility has significantly reduced the effluent levels of its
wastewater.
In order
to directly discharge its wastewater from the El Dorado Facility into the creek
and to meet the June 2007 permit limits, the El Dorado Facility has conducted a
study of the adjacent stream to determine whether a permit modification is
appropriate. On September 22, 2006, the Arkansas Pollution Control and Ecology
Commission (“Commission”) approved the results of the study that showed that the
proposed permit modification is appropriate. A public hearing was held on the
matter on November 13, 2006 with minimal opposition.
The El
Dorado Facility has demonstrated its ability to comply with the more restrictive
permit limits, and the rules which support the more restrictive dissolved
minerals rules have been revised to authorize a permit modification to adopt
achievable dissolved minerals permit limits. The ADEQ has orally agreed to issue
a consent administrative order to authorize the El Dorado Facility to continue
operations without incurring permit violations pending the modification of the
permit to implement the revised rule and to allow the El Dorado Facility to
continue to discharge its wastewater into the creek from and after June 1,
2007.
In
addition, the El Dorado Facility has entered into a consent administrative order
(“CAO”) that recognizes the presence of nitrate contamination in the shallow
groundwater at the El Dorado Facility. A new CAO to address the shallow
groundwater contamination became effective on November 16, 2006 and requires the
evaluation of the current conditions and remediation based upon a risk
assessment. The final remedy for shallow groundwater contamination, should any
remediation be required, will be selected pursuant to the new CAO and based upon
the risk assessment. Based on area well surveys performed, there are no known
users of this shallow groundwater in the area, and
Page
1 of 3
preliminary
risk assessments have not identified any public health risk that would require
remediation. As an interim measure, the El Dorado Facility has installed two
recovery xxxxx to recycle groundwater and to recover nitrates. The cost of any
additional remediation that may be required will be determined based on the
results of the investigation and risk assessment and cannot currently be
reasonably estimated. Therefore, no liability has been established at June 30,
2007.
El Dorado Chemical Company -
Air Matters. Under the terms of a consent administrative order
relating to air matters (“AirCAO”), which became effective in February 2004,
resolving certain air regulatory alleged violations associated with the El
Dorado Facility’s sulfuric acid plant and certain other alleged air emission
violations, the El Dorado Facility is required to implement additional air
emission controls at the El Dorado Facility no later than February
2010. We have decided to accelerate this capital expenditure and
currently estimate the environmental compliance related expenditures to be
between $6.0 and $6.5 million, to be expended through the third quarter of
2008.
Slurry Explosive Corporation
(n/k/a Chemex I Corp.). In April 2002, Slurry Explosive
Corporation (“Slurry”), later renamed Chemex I Corp., a subsidiary within our
Chemical Business, entered into a Consent Administrative Order (“Slurry Consent
Order”) with the Kansas Department of Health and Environment (“KDHE”), regarding
Slurry’s Xxxxxxxxx, Kansas manufacturing facility (“Xxxxxxxxx Facility”). The
Slurry Consent Order addressed the release of contaminants from the facility
into the soils and groundwater and surface water at the Xxxxxxxxx Facility.
There are no known users of the groundwater in the area. Under the terms of the
Slurry Consent Order, Slurry is required to, among other things, submit an
environmental assessment work plan to the KDHE for review and approval, and
agree with the KDHE as to any required corrective actions to be performed at the
Xxxxxxxxx Facility.
In
connection with the sale of substantially all of the operating assets of Slurry
and Universal Tech Corporation (“UTeC”) in December 2002, which was accounted
for as discontinued operations, both subsidiaries within our Chemical Business,
UTeC leased the Xxxxxxxxx Facility to the buyer under a triple net long-term
lease agreement. However, Slurry retained the obligation to be responsible for,
and perform the activities under, the Slurry Consent Order. In addition, certain
of our subsidiaries agreed to indemnify the buyer of such assets for these
environmental matters. The successor (“Chevron”) of the prior owner of the
Xxxxxxxxx Facility has agreed, within certain limitations, to pay and has been
paying one-half of the costs of certain interim remediation measures at the site
approved by the KDHE, subject to reallocation.
At June
30, 2007, the total estimated liability (which is included in current and
noncurrent accrued and other liabilities) in connection with this remediation
matter is approximately $1.4 million and Chevron’s share for one-half of these
costs (which is included in accounts receivable and other assets) is
approximately $.7 million. Slurry and Chevron expect to pursue a
course with the KDHE of long-term surface and ground
Page
2 of 3
water
monitoring to track the natural decline in contamination, instead of the soil
excavation. We estimate the costs relating to this course of action
to be substantially less than the cost of soil excavation but we are unable to
determine if the KDHE will ultimately accept the proposal.
|
B.
|
OTHER
DISCLOSURES
|
El Dorado Chemical Company -
Landfill. In 1995, the EDC entered into a Consent
Administrative Agreement (“Agreement”) with the State of
Arkansas. The Agreement provided for the Company to remediate (by
removal of hazardous material) and close a landfill located on the EDC
site. The Agreement also provided for the Company to monitor
groundwater for certain contaminants and, depending on the results of the
monitoring program, to submit a remediation plan, upgrade certain equipment to
reduce wastewater effluent. EDC timely completed the landfill
remediation and closure and performed the ground water monitoring
activities.
El Dorado Chemical Company –
Caustic. On May 8, 1998, approximately 2,300 gallons of
caustic spilled when a valve in a storage vessel failed, which was released to a
stormwater drain and resulted in a minor fish kill in a drainage ditch near the
plant. EDC entered into a CAO with ADEQ to resolve this
event.
Page 3 of
3
SCHEDULE
5.13
SUBSIDIARIES
Part (a) – Subsidiaries of
Parent
|
1.
|
ThermaClime,
Inc., a Borrower
|
|
2.
|
Northwest
Financial Corporation, a Borrower
|
|
3.
|
LSB
Chemical Corp., a Borrower
|
|
4.
|
El
Dorado Chemical Company, a Borrower
|
|
5.
|
Chemex
I Corp., a Borrower
|
|
6.
|
DSN
Corporation, a Borrower
|
|
7.
|
Chemex
II Corp., a Borrower
|
|
8.
|
El
Dorado Nitric Company
|
|
9.
|
El
Dorado Acid, L.L.C.
|
|
10.
|
El
Dorado Acid II, L.L.C.
|
|
11.
|
El
Dorado Nitrogen, L.P.
|
|
12.
|
XpediAir,
Inc., a Borrower
|
|
13.
|
International
Environmental Corporation, a
Borrower
|
|
14.
|
Climate
Master, Inc., a Borrower
|
|
15.
|
The
Climate Control Group, Inc., a
Borrower
|
|
16.
|
ClimateCraft,
Inc., a Borrower
|
|
17.
|
ThermaClime
Technologies, Inc., a Borrower
|
|
18.
|
CEPOLK
Holdings, Inc.
|
|
19.
|
ClimaCool
Corp., a Borrower
|
|
20.
|
Trison
Construction, Inc., a Borrower
|
|
21.
|
Koax
Corp., a Borrower
|
|
22.
|
Cherokee
Nitrogen Company, a Borrower
|
|
23.
|
Prime
Financial Corporation
|
|
24.
|
Prime
Holdings Corporation
|
|
25.
|
Northwest
Capital Corporation
|
|
26.
|
LSB
Holdings, Inc.
|
|
27.
|
LSB-Europa
Limited
|
|
28.
|
Summit
Machine Tool Inc. Corp.
|
|
29.
|
Cherokee
Nitrogen Holdings, Inc., a Borrower
|
|
30.
|
ClimateCraft
Technologies, Inc.
|
|
31.
|
Summit
Machine Tool Manufacturing Corp.
|
|
32.
|
Summit
Machinery Company
|
|
33.
|
Xxxxx
Plant Chemical Company
|
|
34.
|
Hercules
Energy Mfg. Corporation
|
Page 1 of
3
Part (b) - Equity
Investments of Parent
|
1.
|
CEPOLK
Holdings, Inc., a subsidiary of ThermaClime, Inc., is the sole limited
partner of, and owns a fifty percent (50%) interest in, CEPOLK Limited
Partnership.
|
|
2.
|
Summit
Machinery Company, a subsidiary of Parent, owns a 50% of the value of KAC
Acquisition Company, an Oklahoma corporation, the value of which is de
minimis.
|
Part (c) –
Parent’s Outstanding Equity Interest
in Each of the Borrowers
|
1.
|
ThermaClime, Inc.
(“TCI”). The total authorized capital stock of TCI is
500,000 shares of common stock. The total outstanding shares of
capital stock is 10,000, of which LSB owns 9,500 shares (95% ownership)
and Prime Financial Corporation (“PFC”) owns 500 shares (5%
ownership).
|
|
2.
|
Northwest Financial
Corporation (“NWF”). The total authorized capital stock
of NWF is 100 shares of common stock. The total
outstanding shares of capital stock is 54 which is owned 100% by
TCI.
|
|
3.
|
LSB Chemical Corp.
(“LSBCC”). The total authorized capital stock of LSBCC
is 50 shares of common stock. The total outstanding shares of
capital stock is 50 which is owned 100% by
TCI.
|
|
4.
|
El Dorado Chemical
Company (“EDC”). The total authorized capital stock of
EDC is 25,000 shares of common stock. The total outstanding
shares of capital stock is 1,000 which is owned 100% by
LSBCC.
|
|
5.
|
Chemex I Corp.
(“Chemex I). The total authorized capital stock of
Chemex I is 10,000 shares of common stock. The total
outstanding shares of capital stock is 1,000 which is owned 100% by
EDC.
|
|
6.
|
DSN Corporation
(“DSN”). The total authorized capital stock of DSN is
50,000 shares of common stock. The total outstanding shares of
capital stock is 1,000 which is owned 100% by
LSBCC.
|
|
7.
|
Chemex II Corp.
(“Chemex II). The total authorized capital stock of
Chemex II is 10,000 shares of common stock. The total
outstanding shares of capital stock is 1,000 which is owned 100% by
LSBCC.
|
|
8.
|
XpediAir, Inc.
(“XPA”). The total authorized capital stock of XPA is
500,000 shares of common stock. The total outstanding shares of
capital stock is 10,000 which is owned 100% by
TCI.
|
|
9.
|
International
Environmental Corporation (“IEC”). The total authorized
capital stock of IEC is 300 shares of common stock. The total
outstanding shares of capital stock is 300 which is owned 100% by
TCI.
|
Page
2 of 3
|
10.
|
Climate Master, Inc.
(“CLM”). The total authorized capital stock of CLM is
1,000 shares of common stock. The total outstanding shares of
capital stock is 1,000 which is owned 100% by
TCI.
|
|
11.
|
The Climate Control
Group, Inc. (“CGG”). The total authorized capital stock
of CCG is 100,000 shares of common stock. The total outstanding
shares of capital stock is 10,000 which is owned 100% by
TCI.
|
|
12.
|
ClimateCraft, Inc.
(“CLC”). The total authorized capital stock of CLC is
1,000, of which 900 shares are Class A voting common stock and 100 shares
are Class B non-voting common stock. The total outstanding
shares of both classes of common stock combined is 1,000 which is owned
100% by TCI.
|
|
13.
|
ThermaClime
Technologies, Inc. (“TTI”). The total authorized capital
stock of TTI is 500,000 shares of common stock. The total
outstanding shares of capital stock is 10,000 which is owned 100% by
TCI.
|
|
14.
|
ClimaCool Corp.
(“CCC”). The total authorized capital stock of CCC is
50,000 shares of common stock. The total outstanding shares of
capital stock is 1,000 which is owned 100% by
TCI.
|
|
15.
|
Trison Construction,
Inc. (“Trison”). The total authorized capital stock of
Trison is 500,000 shares of common stock. The total outstanding
shares of capital stock is 10,000 which is owned 100% by
TCI.
|
|
16.
|
Koax Corp.
(“Koax”). The total authorized capital stock of Koax is
50 shares of common stock. The total outstanding shares of
capital stock is 50 which is owned 100% by
TCI.
|
|
17.
|
Cherokee Nitrogen
Company (“CNC”). The total authorized capital stock of
CNC is 500,000 shares of common stock. The total outstanding
shares of capital stock is 10,000 which is owned 100% by
TCI.
|
|
18.
|
Cherokee Nitrogen
Holdings, Inc. (“CNH”). The total authorized capital
stock of CNH is 500,000 shares of common stock. The total
outstanding shares of capital stock is 10,000 which is owned 100% by LSB
Holdings, Inc.
|
Page 3 of
3
SCHEDULE
5.18
INTELLECTUAL
PROPERTY RIGHTS
Chemex I
Corp.
PATENTS
NONE
TRADEMARKS
NONE
COPYRIGHTS
NONE
TRADE NAMES1
NONE
SERVICE
MARKS
NONE
Page 1 of
21
Chemex II
Corp.
PATENTS
NONE
TRADEMARKS
NONE
COPYRIGHTS
NONE
TRADE NAMES1
NONE
SERVICE
MARKS
NONE
Page 2 of
21
Cherokee Nitrogen
Company
PATENTS
NONE
TRADEMARKS
NONE
COPYRIGHTS
NONE
TRADE NAMES1
NONE
SERVICE
MARKS
NONE
Page 3 of
21
Cherokee Nitrogen Holdings,
Inc.
PATENTS
NONE
TRADEMARKS
NONE
COPYRIGHTS
NONE
TRADE NAMES1
NONE
SERVICE
MARKS
NONE
Page 4 of
21
ClimaCool
Corp.
PATENTS
NONE
TRADEMARKS
NONE
COPYRIGHTS
NONE
TRADE NAMES1
NONE
SERVICE
MARKS
NONE
Page 5 of
21
Climate Master,
Inc.
PATENTS
|
Patent
|
App./Reg.
No.
|
Place
of
Registration
|
Issue Date |
|
“Water-Cooled
Air Conditioning
System
Using Condenser Water
Regeneration
for Precise Air Reheat
in
Dehumidifying Mode”
|
11/161,808
|
United States |
Pending
|
TRADEMARKS
|
Xxxx
|
Serial./Reg.
No.
|
Place
of
Registration
|
Issue Date |
|
“Climate
Master (& Design)”
|
2,139,570 | United States |
02/24/98
|
|
“Climate
Master (& Design)”
|
#TMA
471,487
|
Canada |
02/21/97
|
|
“Climate
Master”
|
808,500
|
United
States
|
05/17/66
|
|
“Climate
Master”
|
409,647
|
Chile
|
07/22/93
|
|
“Climate
Master”
|
00000
|
Xxxxxx
|
10/08/92
|
|
“Climate
Master”
|
000/00
|
Xxxxx Xxxxxx |
12/30/92
|
|
“Climate
Master”
|
1,514,734
|
United Kingdom |
11/13/98
|
|
“Climate
Master”
|
11,215
|
Greece |
07/07/98
|
|
“Climate
Master”
|
280854
|
Korea
|
12/07/93
|
|
“Climate
Master”
|
641,594
|
Taiwan |
04/16/94
|
|
“Climate
Master”
|
614,556
|
Taiwan |
10/01/93
|
|
“Climate
Master”
|
000000
|
Xxxxxx |
12/10/92
|
|
“Climate
Master”
|
25162
|
Kuwait
|
08/16/93
|
|
“Climate
Master”
|
0-999746
|
Czech
Republic
|
03/20/00
|
|
“Climate
Master”
|
583,151
|
Benelux
|
06/22/95
|
|
“Climate
Master”
|
95575091
|
France
|
06/09/95
|
|
“Climate
Master”
|
147,007
|
Hungary |
04/25/95
|
|
“Climate
Master”
|
172643
|
Norway |
04/25/96
|
|
“Climate
Master”
|
309
649
|
Portugal |
05/06/96
|
|
“Climate
Master”
|
X-XXX-0000-00
|
Xxxxxx Xxxxxxxx |
05/02/95
|
|
“Climate
Master”
|
00000
|
Xxxxxx
|
05/01/95
|
|
“Climate
Master”
|
729,783
|
Italy
|
10/16/97
|
|
“Climate
Master”
|
402,883
|
Europe |
02/24/98
|
|
“Climate
Master”
|
3480166
|
China
|
03/10/03
|
|
“Climate
Master”
|
860,657
|
Australia
|
12/14/00
|
|
“Climate
Mate”
|
TMA 371,539 | Canada | 08/03/90 |
|
|
|
|
Page
6 of 21
|
Xxxx
|
Serial./Reg.
No.
|
Place
of
Registration
|
Issue Date |
|
“Roommate”
|
1,906,435 | United States |
07/18/95
|
|
“Paradigm”
|
2,112,244
|
United States | 11/11/97 |
|
“Geodesigner”
|
2,184,992 | United States |
08/25/98
|
|
“Earthpure”
|
2,994,853
|
United States | 09/13/05 |
|
“Climadry”
|
3,253,779 | United States |
06/19/07
|
|
|
|
COPYRIGHTS
NONE
TRADENAMES1
Climate
Master
SERVICE
MARKS
NONE
Page 7 of
21
ClimateCraft,
Inc.
PATENTS
NONE
TRADEMARKS
|
Xxxx
|
Serial./Reg.
No.
|
Place
of
Registration
|
Issue Date |
|
“Climatecraft”
|
#2,369,333
|
United States |
07/18/00
|
COPYRIGHTS
NONE
TRADE NAMES1
NONE
SERVICE
MARKS
NONE
Page 8 of
21
DSN
Corporation
PATENTS
NONE
TRADEMARKS
NONE
COPYRIGHTS
NONE
TRADE NAMES1
NONE
SERVICE
MARKS
NONE
Page 9 of
21
El Dorado Chemical
Company
PATENTS
NONE
TRADEMARKS
|
Xxxx
|
Serial./Reg.
No.
|
Place
of
Registration
|
Issue Date |
|
“El
Dorado (& Design)”
|
1,427,064 | United States | 02/03/87 |
| “E-2” | 833,891 | United States | 08/22/67 |
COPYRIGHTS
NONE
TRADE NAMES1
NONE
SERVICE
MARKS
NONE
Page 10 of
21
International Environmental
Corporation
PATENTS
|
Patent
|
Serial./Reg.
No.
|
Place
of
Registration
|
Issue Date |
| “Conditioned Air Fan Coil Unit” |
6,109,044
|
United States |
08/29/00
|
TRADEMARKS
|
Xxxx
|
Serial./Reg.
No.
|
Place
of
Registration
|
Issue Date |
|
“International Environmental
Corporation (& IE Design)”
|
1,569,505
000000
|
Xxxxxx Xxxxxx
Mexico
|
12/05/89
08/18/93
|
| 000/00 | Xxxxx Xxxxxx | 08/31/93 |
| “International Environmental” | B1,514,822 | United Kingdom | 07/01/94 |
| 92/165,999 | Hong Kong | 11/21/94 |
|
IEC
International Environmental (&
Design)”
|
77110687 | United States | Pending |
| “Sureflow” |
2,449,571
|
United
States
|
05/08/01
|
|
“IE
(Stylized)”
|
2,556,892
|
United States |
04/02/02
|
| “Air Coil Technologies” | 1,755,144 | United States | 03/02/93 |
| “UV Ultrashield” | 2,660,647 | United States | 12/10/02 |
COPYRIGHTS
NONE
TRADE NAMES1
Air Coil
Technologies
International
Climate Systems
SERVICE
MARKS
NONE
Page 11 of
21
Koax
Corp.
PATENTS
NONE
TRADEMARKS
|
Xxxx
|
Serial./Reg.
No.
|
Place
of
Registration
|
Issue Date |
|
“Koax”
|
1,776,407
|
United States |
06/15/93
|
|
“Koax
and design”
|
1,905,551
|
United States |
07/18/95
|
COPYRIGHTS
NONE
TRADE NAMES1
NONE
SERVICE
MARKS
NONE
Page 12 of
21
LSB Chemical
Corp.
PATENTS
NONE
TRADEMARKS
NONE
COPYRIGHTS
NONE
TRADE NAMES1
NONE
SERVICE
MARKS
NONE
Page 13 of
21
Northwest Financial
Corporation
PATENTS
NONE
TRADEMARKS
NONE
COPYRIGHTS
NONE
TRADE NAMES1
NONE
SERVICE
MARKS
NONE
Page 14
of 21
The Climate Control Group,
Inc.
PATENTS
NONE
TRADEMARKS
|
Xxxx
|
Serial./Reg.
No.
|
Place
of
Registration
|
Issue Date |
|
“APR Corporation and
Design”
|
1,624,527
|
United
States
|
11/27/90
|
COPYRIGHTS
NONE
TRADE NAMES1
NONE
SERVICE
MARKS
NONE
Page 15 of
21
ThermaClime,
Inc.
PATENTS
NONE
TRADEMARKS
NONE
COPYRIGHTS
NONE
TRADE NAMES1
NONE
SERVICE
MARKS
NONE
Page 16 of
21
ThermaClime, Inc.
(continued)
DOMAIN
NAMES
The
following domain names are registered by ThermaClime, Inc. with
Xxxxxxx.xxx:
|
1.
|
xxxxxxxxxxxxxxxxxxx.xxx
|
|
2.
|
xxxx.xxx
|
|
3.
|
xxxx.xxx
|
|
4.
|
xxxxxxxxxxxxx.xxx
|
|
5.
|
xxx-xxx.xxx
|
|
6.
|
xxxxxxxxx.xxx
|
|
7.
|
xxxxxxxxxx.xxx
|
|
8.
|
xxxxxxxxxxx.xxx
|
|
9.
|
xxxxxxxxxxxxx.xxx
|
|
10.
|
xxxxxxxxxxxxx.xx
|
|
11.
|
xxxxxxxxxxxxx.xx
|
|
12.
|
xxxxxxxxxxxxxxxxxxx.xxx
|
|
13.
|
xxxxxxxxx.xxx
|
|
14.
|
xxxxxxxxxxx.xxx
|
|
15.
|
xxxxxxxx.xxx
|
|
16.
|
xxxxxxxxxxxxxxxx.xxx
|
|
17.
|
xxxxxx.xx
|
|
18.
|
xxxxxxxxxxxxxxxxxx.xxx
|
|
19.
|
xxxxxxxxxxxxxxxxxx.xxx
|
|
20.
|
xxxxxxxxxxxxxxxxxx.xxxx
|
|
21.
|
xxxxxxxxxxxxxxxxxx.xxx
|
|
22.
|
xxxxxxxxxxxxxxxxxx.xxx
|
|
23.
|
xxxxxxxx.xxx
|
|
24.
|
xxx-xxx.xxx
|
|
25.
|
xxxxxx.xxx
|
|
26.
|
xxxxxxxxxxxxxxx.xxx
|
|
27.
|
xxxxxxxx-xxxxxxx.xxx
|
|
28.
|
xxxxxxx.xxx
|
|
29.
|
xxxxxxxxxxxxxxxxxxxxx.xxx
|
|
30.
|
xxxxxxxxx.xxx
|
|
31.
|
xxxxxxxx.xxx
|
|
32.
|
xxxxxxx.xxx
|
|
33.
|
xxxxxxxxx.xxx
|
Page 17 of
21
ThermaClime Technologies,
Inc.
PATENTS
NONE
TRADEMARKS
NONE
COPYRIGHTS
NONE
TRADE NAMES1
NONE
SERVICE
MARKS
NONE
Page 18
of 21
Trison Construction,
Inc.
PATENTS
NONE
TRADEMARKS
NONE
COPYRIGHTS
NONE
TRADE NAMES1
Trison
Geothermal Construction Inc.
SERVICE
MARKS
NONE
Page 19 of
21
XpediAir,
Inc.
PATENTS
NONE
TRADEMARKS
|
Xxxx
|
Serial./Reg.
No.
|
Place
of
Registration
|
Issue Date |
|
“Climacool”
|
2,564,496
|
United States |
04/23/02
|
| “CHP” | 1,707,991 | United States | 08/18/92 |
COPYRIGHTS
NONE
TRADE NAMES1
NONE
SERVICE
MARKS
NONE
* Trademark is the
subject of a Settlement Agreement with Expedia, Inc. regarding XpediAir, Inc’s
right to use the name, throughout the world, in connection with the sale and
manufacture of HVAC equipment and related goods and services, and to register
the name with the USPTO or any foreign patent and trademark office in design
form only.
LICENSES
|
1.
|
License
Agreement between Koax Corp. and The City of Oklahoma City Pursuant to ONG
Franchise Ordinance to Authorize Receipt of Transport Gas, dated July 3,
2006.
|
|
2.
|
License
Agreement between Climate Master, Inc. and The City of Oklahoma City
Pursuant to ONG Franchise Ordinance to Authorize Receipt of Transport Gas,
dated December 8, 2005.
|
|
3.
|
License
Agreement between International Environmental Corporation and The City of
Oklahoma City Pursuant to ONG Franchise Ordinance to Authorize Receipt of
Transport Gas, dated December 8,
2006.
|
|
4.
|
System
License Agreement between Cherokee Nitrogen Company and Tennessee Gas
Pipeline Company and Midwestern Gas Transmission Company, dated November
30, 2000.
|
|
5.
|
Software
License between PTC Global and International Environmental
Corporation.
|
|
6.
|
Software
License between SigmaTEK and International Environmental
Corporation.
|
|
7.
|
Software
License and Services Agreement between ThermaClime, Inc. (formerly known
as ClimaChem, Inc.) and Cognos Corporation (successor in interest to
Adaytum, Inc.), effective June 29, 2000, as
amended.
|
|
8.
|
Software
License Agreement between ThermaClime, Inc. (formerly known as ClimaChem,
Inc.) and Electronic Storage Corporation, executed April 4,
2003.
|
|
9.
|
Software
and Services License Agreement between Cherokee Nitrogen Company and
Mainsaver Software, effective December 4,
2002.
|
|
10.
|
Master
License Agreement for Software Program Processes between El Dorado
Chemical Company and Marcam Solutions,
Inc.
|
|
11.
|
Engineering
and License Agreement between El Dorado Chemical Company and
Xxxxxxxxxx-Xxxxxxx S.A., dated October 27, 1994, regarding LDAN plant
capacity increase.
|
|
12.
|
Order
Form, dated June 26, 1997, between SSA Global Technologies, Inc.,
successor in interest to Computer Associates International, Inc., and LSB
Industries, Inc., as amended.
|
Page 21 of
21
SCHEDULE
5.21
PIPELINES
Cherokee
Site
|
1.
|
North
Alabama natural gas pipeline.
|
|
2.
|
Enbridge
natural gas pipeline.
|
|
3.
|
Cherokee
Water Company water line.
|
El
Dorado Site
|
1.
|
Valero
ammonia pipeline.
|
|
2.
|
Centerpoint
Energy natural gas pipeline.
|
|
3.
|
Water
pipeline supplies treated river water to the facility as industrial water
make up.
|
SCHEDULE
5.22
MATERIAL
CONTRACTS
|
1.
|
Anhydrous
Ammonia Sales Agreement between El Dorado Chemical Company (“EDC”) and
Xxxx Nitrogen International SARL and Xxxx Nitrogen Company(“Xxxx”),
effective January 3, 2005.
|
|
2.
|
AN
Supply Agreement between EDC and Orica USA, Inc., dated November 1, 2001,
as amended.
|
|
3.
|
On-Site
Product Supply Agreement between EDC and Air Liquide America Corporation,
dated as of May 31, 1994.
|
|
4.
|
Sales
Agreement between CNC and Xxxxxx Xxxxxxxx LLC for Ammonium Nitrate, dated
October 1, 2001.
|
|
5.
|
NAESB
Base Contract between CNC and Interconn Resources, Inc., dated April 1,
2003.
|
See also
Schedules 5.23 and 7.05.
SCHEDULE
5.23
PERMITS
Cherokee Nitrogen Company,
Cherokee, Alabama
|
·
|
NPDES
Wastewater Discharge Permit #AL 0000418; effective date
2-1-06; expiration date
1-31-11
|
|
·
|
Title
V Air Permit #701-0013; effective date 12-14-06; expiration date
00-00-00
|
Xx Xxxxxx Xxxxxxxx Xxxxxxx,
Xx Xxxxxx, Xxxxxxxx
|
·
|
NPDES
Wastewater Discharge Permit #XX0000000; effective date 7-1-02; expiration
date
|
|
|
6-30-07
|
|
·
|
Title
V Air Permit #0573-AOP-R7; effective date 4-12-05; expiration date
4-11-10
|
SCHEDULE
5.27
LABOR
MATTERS
|
1.
|
El
Dorado Chemical Company (“EDC”) is party to collective bargaining
agreement, effective October 17, 2004, with the International Association
of Machinists and Aerospace Workers, AFL-CIO, Local
224.
|
|
2.
|
EDC
is party to a collective bargaining agreement, effective August 1, 2004,
with the Paper, Allied-Industrial, Chemical & Energy (PACE) Workers
International Union AFL-CIO and Its Local
5-434.
|
|
3.
|
Cherokee
Nitrogen Company is party to a collective bargaining agreement, dated
November 12, 2004, with the United Steelworkers of America's International
Union, AFL-CIO, CLC, Cherokee Local
417-G.
|
SCHEDULE
7.01(b)
EXISTING
LIENS
|
Name
of Obligor
|
Description
of Secured Indebtedness
|
|
Chemex
I Corp.
|
None
|
|
Name
of Obligor
|
Description
of Secured Indebtedness
|
|
Chemex
II Corp.
|
None
|
|
Name
of Obligor
|
Description
of Secured Indebtedness
|
|
Cherokee
Nitrogen Company
|
None
|
|
Name
of Obligor
|
Description
of Secured Indebtedness
|
|
Cherokee
Nitrogen Holdings, Inc.
|
None
|
|
Name
of Obligor
|
Description
of Secured Indebtedness
|
|
ClimaCool
Corp.
|
None
|
|
Name
of Obligor
|
Description
of Secured Indebtedness
|
|
Climate
Master, Inc. (“CLM,”) as bailee
(operating
lease)
|
Secured
Party: Marquette Equipment Finance, LLC, as Xxxxxx, assigned to
Park National Bank
Collateral: One
(1) Chiyoda SP-25ST 3 Axis Tube Xxxxxx with RH rotation, including all
standard equipment and 5/8”, 3/4” and 7/8” OD and
mandrels
|
|
CLM
(operating lease)
|
Secured
Party: Prime Financial Corporation
Collateral: Trumpf
L3040 Laser Cutting Machine System purchased from Icon Machine Tool, Inc.,
S/N A0235A0061, and all accessories and attachments
thereto.
|
|
CLM,
as lessee (operating lease)
|
Secured
Party: Prime Financial Corporation, as lessor
Collateral: One
(1) Trumpf TruLaser 3530 Laser Cutting Machine, Serial
#AX035A0061
|
|
CLM
(operating lease)
|
Secured
Party: National Machine Tool Financial Corporation and TCF
Equipment Finance, Inc.
Collateral: One
(1) new Trumpf L3530 4000 Watt Laser with 60”x120”, S/N A0235A0061, and
all accessories and attachments
thereto.
|
Page 1 of
7
|
Name
of Obligor
|
Description
of Secured Indebtedness
|
|
CLM,
as lessee (operating lease)
|
Secured
Party: IOS Capital, as lessor
Collateral: All
equipment now or hereafter leased (PCP 1050, booklet maker and
accessories) in an equipment leasing transaction in connection with that
certain Master Agreement No. -------------, Product Schedule No./Agreement
No. 2068765, as amended from time to time, between IOS Capital, LLC as
lessor, and the above referenced Lessee/Debtor, including, without limit,
the equipment listed below, and all additions, improvements, attachments,
accessories, accessions, upgrades and replacements related thereto, and
any and all substitutions or exchanges, and any and all products,
insurance and/or other proceeds (cash and non-cash)
therefrom. Customer: 1095557 IKCPP500
C11029146
|
|
CLM,
as lessee (operating lease)
|
Secured
Party: Prime Financial Corporation, as lessor
Collateral: 1
each five stage Power Spray Stainless Washer (installed) in accordance
with quote 3703-0107R3 from Industrial Finishing
Systems.
|
|
CLM,
as lessee (operating lease)
|
Secured
Party: Prime Financial Corporation, as lessor
Collateral: Xxxxxxxxx-Xxxx
oil-free Nirvana compressor system consisting of various components; S/N
IRN75H-OF.
|
|
CLM,
as lessee (operating lease)
|
Secured
Party: Prime Financial Corporation, as lessor
Collateral: Gamma
G333PC Wire Processing System per quote 06-0150-2743-0135C; S/N 0-000000-0
and all accessories and attachments thereto.
|
|
CLM,
as lessee (operating lease)
|
Secured
Party: IOS Capital, as lessor
Collateral: All
equipment now [5 Ricoh copiers] or hereafter leased in an equipment
leasing transaction in connection with that certain Master Agreement No.
-------------, Product Schedule No./Agreement No. 2929907, as amended from
time to time, between Lessor and Lessee, including, without limit, the
equipment listed below, and all additions, improvements, attachments,
accessories, accessions, upgrades and replacements related thereto, and
any and all substitutions or exchanges, and any and all products,
insurance and/or other proceeds (cash and non-cash)
therefrom. CUSTOMER: 1095557 RIAF2035 S/P
J5837002733 RIAF2035 S/P J5837002727 RIAF2035 S/P J5837102886 RIAF2035 S/P
J0000000000 RIAF2035 S/P J5837102721 RIAF1060 J4235501227 RIAF1060
J422500470 RIAF2090 J7031100205 RIAF2090
J7031100244
|
Page 2 of
7
|
Name
of Obligor
|
Description
of Secured Indebtedness
|
|
CLM,
as lessee (operating lease)
|
Secured
Party: Prime Financial Corporation, as lessor
Collateral: One
(1) Amada Vipros 368 King, Turret Punch Press, S/N 36840024, with New
London Slug Conveyor, One (1) Amada LUL510 loading device, S/N 00510090,
Amada SR510 .30 unloading device, S/N 2218, Sun Classic Workstation with
Line Control Software, S/N FW900085, AP100 Punch Upgrade, AP100 Punch Add.
Seat Upgrade, complete with all attachments now or hereafter
acquired.
|
|
CLM
(operating lease)
|
Secured
Party: Prime Financial Corporation
Collateral: Amada
press brake, model HFB 1003/8, S/N XXX000000 R981151, w/ ISB light
curtain
|
|
CLM,
as lessee (operating lease)
|
Secured
Party: Prime Financial Corporation, as lessor
Collateral: One
(1) Raidzone GangSTOTR Systems RC8-2-R2000 (2x8 disk rack mount systems
and all accessories and attachments thereto.
|
|
CLM,
as lessee (operating lease)
|
Secured
Party: Prime Financial Corporation, as lessor
Collateral: Nine
(9) OptiGun-2AX Automatic Guns, Nine (9) OptiTronicPlus Control Units and
associated accessories.
|
|
CLM,
as lessee (operating lease)
|
Secured
Party: Prime Financial Corporation, as lessor
Collateral: Six
(6) sets of ECI line equipment (Procix) and associated
accessories.
|
|
CLM,
as lessee (operating lease)
|
Secured
Party: Prime Financial Corporation, as lessor
Collateral: One
(1) Amada 386 King, Vipros 30 ton CNC Turret Punch, S/N 36820017 and
associated accessories.
|
|
CLM,
as lessee (operating lease)
|
Secured
Party: Prime Financial Corporation, as lessor
Collateral: One
(1) Amada CNC Blanking Shear, S/N 101000056 and associated
accessories.
|
|
CLM,
as lessee (operating lease)
|
Secured
Party: Prime Financial Corporation, as lessor
Collateral: One(1)
Trumpf Laser 3040 Plus and associated accessories
|
|
CLM,
as lessee (operating lease)
|
Secured
Party: Prime Financial Corporation, as lessor
Collateral: One(1)
Trumpf Laser 3040 Plus and associated accessories
|
|
CLM
(operating lease)
|
Secured
Party: RCA Capital Corp.
Collateral: One
(1) new Chiyoda SP-25ST 3 Axis CNC Pipe Xxxxxx and associated
accessories
|
|
CLM,
as lessee (operating lease)
|
Secured
Party: Prime Financial Corporation, as lessor
Collateral: One
(1) single Tube Cutoff Line (STCOS) and all accessories and attachments
thereto (Xxxx Oak Copper Cut).
|
|
CLM,
as lessee (operating lease)
|
Secured
Party: Prime Financial Corporation, as lessor, as assigned to
Marquette Equipment Finance, LLC, as assigned to Park National
Bank
Collateral: One
(1) Chiyoda SP-25 ST 3-Axis Tube Xxxxxx and associated
accessories.
|
Page 3 of
7
|
Name
of Obligor
|
Description
of Secured Indebtedness
|
|
CLM
(operating lease)
|
Secured
Party: Prime Financial Corporation
Collateral: One
1996 Amada FCXB-III-8025 CNC Press Brake
|
|
CLM
(operating lease)
|
Secured
Party: Prime Financial Corporation
Collateral: IPCS
Equipment and accessories
|
|
CLM
(operating lease)
|
Secured
Party: Prime Financial Corporation
Collateral: Used
1995 FBD-125 Amada Press Brake, S/N 12530058
|
|
CLM
(operating lease)
|
Secured
Party: Prime Financial Corporation
Collateral: 88
ton Amada HFB, S/N R091-18; 88 ton Amada HFB, S/N R970432; 138 ton Amada
FBD, S/N 12530263
|
|
Name
of Obligor
|
Description
of Secured Indebtedness
|
|
ClimateCraft,
Inc. (“CLC”) (operating lease)
|
Secured
Party: Prime Financial Corporation
Collateral: Trumpf
NC Punching Machine
|
|
CLC
(operating lease)
|
Secured
Party: Prime Financial Corporation
Collateral: 1999
Amada HFB1254 Promecam CNC Press Brake w/ Controls
|
|
CLC
|
Secured
Party: City of Oklahoma City
Collateral: Real
estate owned by Summit Machine Tool Manufacturing Corp.
|
|
CLC
(operating lease)
|
Secured
Party: Prime Financial Corporation
Collateral: Two
(2) model 625014 Accushears w/ 48” extended travel and CNC front gauging
12’x6’x6’; S/N 5110 and 5111
|
|
CLC
(operating lease)
|
Secured
Party: Prime Financial Corporation
Collateral: Trumpf
model TC2020 Punch Machine, S/N A0030A0239 with tooling
|
|
CLC
(operating lease)
|
Secured
Party: Prime Financial Corporation
Collateral: Amada
CNC Hydraulic Press Brake model HFB220/440, SN
H980519
|
|
Name
of Obligor
|
Description
of Secured Indebtedness
|
|
DSN
Corporation
|
None
|
|
Name
of Obligor
|
Description
of Secured Indebtedness
|
|
El
Dorado Chemical Company (“EDC”) as bailee
|
Secured
Party: Orica USA Inc., as xxxxxx
Collateral: All
of xxxxxx’x inventory located at bailee’s El Dorado, AR
facility
|
|
EDC,
as lessee
(operating
lease)
|
Secured
Party: LSB Industries, Inc.
Collateral: Catalysts
associated with EDC’s El Dorado, AR
facility
|
Page 4 of
7
|
Name
of Obligor
|
Description
of Secured Indebtedness
|
|
EDC,
as bailee
(operating
lease)
|
Secured
Party: Republic Bank, Inc., as xxxxxx
Collateral: Personal
property (rail cars) located at bailee’s El Dorado, AR facility and
described in Lease Schedule No. 001 to Master Lease Agreement No. AF10506
by and between Prime Financial Corporation, as lessee, and Applied
Financial, LLC, as lessor
|
|
EDC
|
Secured
Party: Air Liquide Industrial US LP
Collateral: Gas
generating plant, located at debtor’s El Dorado, AR
facility
|
|
EDC
(operating lease)
|
Secured
Party: General Electric Capital Corporation
Collateral: PerkinElmer
Aanalyst 700 AA Spectrometer and
accessories
|
|
Name
of Obligor
|
Description
of Secured Indebtedness
|
|
International
Environmental Corporation (“IEC”) (operating lease)
|
Secured
Party: Prime Financial Corporation
Collateral: Bolina
Cut-to-Length; 2 Optiflex 110/08 Pullmax CNC Press Brakes; vertical
xxxxxx; Trumpf laser cutting machine
|
|
IEC
(operating lease)
|
Secured
Party: Prime Financial Corporation
Collateral: Amada
Turret Press Dies & accessories
|
|
IEC
(operating lease)
|
Secured
Party: Prime Financial Corporation
Collateral: Two
Trumpf Laser Cutting Machines
|
|
IEC
|
Secured
Party: Amada Capital Corporation
Collateral: Amada
Turret Press Model VIPROS358K w/ scrap conveyor and
attachments
|
|
IEC
|
Secured
Party: Amada Capital Corporation
Collateral: Software
package consisting of two seats of Anmest punch software and one seat
AP100 US punch complete w/ all attachments
|
|
IEC
(operating lease)
|
Secured
Party: Prime Financial Corporation
Collateral: One
(1) T-Drill SP-55 tube end spinner, 440V, S/N 97032
|
|
IEC
(operating lease)
|
Secured
Party: Prime Financial Corporation
Collateral: High
Takt assembly line (spur line south
bldg)
|
Page 5 of
7
|
Name
of Obligor
|
Description
of Secured Indebtedness
|
|
IEC
(operating lease)
|
Secured
Party: IOS Capital
Collateral: All
equipment now or hereafter leased in an equipment leasing transaction in
connection with that certain Master Agreement No. -------------, Product
Schedule No./Agreement No. 1842990, as amended from time to time, between
IOS Capital, LLC as lessor, and the above referenced Lessee/Debtor,
including, without limit, the equipment listed below, and all additions,
improvements, attachments, accessories, accessions, upgrades and
replacements related thereto, and any and all substitutions or exchanges,
and any and all products, insurance and/or other proceeds (cash and
non-cash) therefrom. Customer: 357586 RIAF 2075 S/P
C11020120, RIAF2075 S/P C11020023, RIAF 2075 S/P C11020123, RIAF2060 S/P
C11020019, RIAF3030 S/P C11020011, RIAF3030 S/P X00000000, RIAF3030 W/P
C11020009, RIAF3030 SP C11020008, RIAF3425C C11020124, ZZrightfax
software
|
|
IEC
(operating lease)
|
Secured
Party: Prime Financial Corporation
Collateral: Trumpf
Laser 3040 Plus, 4000 watt resonator
|
|
IEC
(operating lease)
|
Secured
Party: Prime Financial Corporation
Collateral: Security
system
|
|
Name
of Obligor
|
Description
of Secured Indebtedness
|
|
Koax
Corp (operating lease)
|
Secured
Party: Intrust Bank
Collateral: LSE
0000000 S/N MPH04374
|
|
Name
of Obligor
|
Description
of Secured Indebtedness
|
|
LSB
Chemical Corp.
|
None
|
|
Name
of Obligor
|
Description
of Secured Indebtedness
|
|
Northwest
Financial Corporation
|
None
|
|
Name
of Obligor
|
Description
of Secured Indebtedness
|
|
The
Climate Control Group, Inc.
|
None
|
|
Name
of Obligor
|
Description
of Secured Indebtedness
|
|
ThermaClime,
Inc. (f/k/a ClimaChem, Inc.)
|
Secured
Party: Toshiba America Information Systems
Collateral: Six
(6) Toshiba copiers
|
Page 6 of
7
|
Name
of Obligor
|
Description
of Secured Indebtedness
|
|
ThermaClime
Technologies, Inc. (f/k/a ACP International Limited (“TTI”) (operating
lease)
|
Secured
Party: Park National Bank, assigned to Marquette Equipment
Finance, LLC
Collateral: All
equipment, software and other property leased under that Equipment Lease
dated March 1, 2007 between Prime Financial Corporation and TTI
(Continental washer and dryer)
|
|
TTI,
as bailee (operating lease)
|
Secured
Party: Park National Bank, as xxxxxx
Collateral: Radiator
coil washer and dryer
|
|
TTI
(operating lease)
|
Secured
Party: Prime Financial Corporation
Collateral: One
(1) Continental Equipment 2-stage belt washer, natural gas heated dryer
and drain tank
|
|
TTI
(operating lease)
|
Secured
Party: Prime Financial Corporation
Collateral: Xxxx
oak fin die, S/N FDM-1532-1
|
|
Name
of Obligor
|
Description
of Secured Indebtedness
|
|
Trison
Construction, Inc. (“Trison”)
|
None
|
|
Name
of Obligor
|
Description
of Secured Indebtedness
|
|
XpediAir,
Inc.
|
None
|
Page 7 of
7
SCHEDULE
7.02
EXISTING INDEBTEDNESS AND
GUARANTEES
(as
of September 30, 2007)
Part A -
Indebtedness
|
1.
|
International
Environmental Corporation is indebted to Xxxxx Capital Corporation in the
amount of $57,714.
|
|
2.
|
ClimateCraft,
Inc. is indebted to the following:
|
|
a.
|
The
City of Oklahoma City in the amount of
$2,450,000.
|
|
b.
|
Summit
Machine Tool Manufacturing Corp. in the principal amount of
$715,719.
|
|
3.
|
ThermaClime,
Inc. is indebted to the following:
|
|
a.
|
CEPOLK
Holdings, Inc. in the principal amount of
$3,898,523.
|
|
b.
|
El
Dorado Nitrogen, L.P. in the principal amount of
$25,734,720.
|
|
4.
|
Part B -
Guarantees
N/A
1 Adjustment as of October 31, 2007.
Parcel IV
TRISON
CONSTRUCTION, INC.,
CHEMEX
II CORP.,
EXHIBIT M
SCHEDULE
7.03
EXISTING
INVESTMENTS
(as
of September 30, 2007)
|
1.
|
See
Schedule 5.13 for Equity Interests.
|
|
2.
|
El
Dorado Chemical Company (“EDC”) is indebted to the
following:
|
|
a.
|
ThermaClime,
Inc. (“TCI”) in the principal amount of
$35,593,138.
|
|
b.
|
LSB
Chemical Corp. (“LSB Chemical”) in the principal amount of
$2,098,787.
|
|
3.
|
Trison
Construction, Inc. is indebted to TCI in the principal amount of
$6,364,700 less $2,500,0001.
|
|
4.
|
ClimateCraft,
Inc. is indebted to TCI in the principal amount of $6,947,768 less
$5,200,0001.
|
|
5.
|
TCI
is indebted to the following:
|
|
a.
|
International
Environmental Corporation in the principal amount of
$76,297,857.
|
|
b.
|
The
Climate Control Group, Inc. in the principal amount of
$3,104,268.
|
|
c.
|
Climate
Master, Inc. in the principal amount of
$40,537,986.
|
|
d.
|
Koax
Corp. in the principal amount of
$22,811,075.
|
|
e.
|
Chemex
I Corp. (“Chemex I”) in the principal amount of
$276,944.
|
|
f.
|
Chemex
II Corp. (“Chemex II”) in the principal amount of
$1,484,718.
|
|
g.
|
Northwest
Financial Corporation in the principal amount of
$13,328,828.
|
|
6.
|
Cherokee
Nitrogen Company is indebted to the following
companies:
|
|
a.
|
TCI
in the principal amount of
$10,604,163.
|
|
b.
|
EDC
in the principal amount of
$2,438,209.
|
|
7.
|
LSB
Chemical is indebted to the following
companies:
|
|
a.
|
TCI
in the principal amount of $24,187,624 plus $4,500,0001.
|
|
b.
|
DSN
Corporation (“DSN”) in the principal amount of
$275,773.
|
|
8.
|
DSN
is indebted to TCI in the principal amount of $18,784,414 less
$4,500,0001.
|
|
9.
|
XpediAir,
Inc. is indebted to TCI in the principal amount of $1,768,968 less
$1,900,0001.
|
|
10.
|
ThermaClime
Technologies, Inc. is indebted to TCI in the principal amount of
$3,548,796 less $2,700,0001.
|
|
11.
|
ClimaCool
Corp. (“CCC”) is indebted to TCI in the principal amount of $3,450,175
less $2,300,0001.
|
1 Adjustment as of October 31, 2007.
|
12.
|
Chemex
I is indebted to the following
companies:
|
|
a.
|
LSB
Chemical in the principal amount of $385,282 less $150,0001.
|
|
b.
|
Chemex
II in the principal amount of $348.
|
|
13.
|
LSB
Holdings, Inc., a subsidiary of LSB Industries, Inc., is indebted to CCC
in the principal amount of
$2,705,594.
|
SCHEDULE
7.05
FACILITY
USE/LEASES
Part I – Cherokee
Site
|
1.
|
Cherokee
Nitrogen Company leases from Cherokee Nitrogen Holdings, Inc. (“CNH”) the
Cherokee Site and Facility Assets therein pursuant to a Lease Agreement
effective January 1, 2004.
|
|
2.
|
Xxxxxx
Xxxxxxxx LLC leases from CNH a certain portion of the Cherokee Site
pursuant to a Ground Lease dated November 4, 1998, as
amended.
|
|
3.
|
Farm
Lease between CNH and Xxxxxx Farms, effective as of January 1,
2007.
|
|
4.
|
Ground
Lease between United States Steel Corporation and The Industrial
Development Board of the Town of Cherokee (“Board”) dated as of April 1,
1980, Lease Agreement between the Board and Airco, Inc. dated as of April
1, 1980, as amended between the Board and The BOC Group, Inc. (formerly
known as Airco, Inc.) on August 1, 1993, Trust Indenture between the Board
and Trust Company Bank dated as of April 1, 1980 and Indenture of Trust
between the Board and First-Citizens Bank and Trust Company dated as of
August 1, 1993.
|
|
5.
|
Airgas
Specialty Products, Inc. leases from CNH a certain portion of the Cherokee
Site pursuant to a Lease Agreement dated June 1,
2005.
|
|
6.
|
Austin
Powder Company leases from CNH a certain portion of the Cherokee Site
pursuant to a Real Property Lease and Easement dated effective November 1,
2007.
|
Part II – El Dorado
Site
|
1.
|
El
Dorado Chemical Company (“EDC”) leases from Northwest Financial
Corporation (“NWF”) a certain portion of the El Dorado Site pursuant to a
Lease Agreement dated March 7, 1988, as
amended.
|
|
2.
|
DSN
Corporation (“DSN”) leases from NWF a certain portion of the El Dorado
Site pursuant to a Lease Agreement dated April 15,
2003.
|
|
3.
|
EDC
subleases from DSN a certain portion of the El Dorado Site and the
Facility Assets therein pursuant to a Sublease Agreement dated April 15,
2003.
|
|
4.
|
On-Site
Product Supply Agreement between EDC and Air Liquide America Corporation
dated May 31, 1994.
|
Page 1 of
1
SCHEDULE
7.08
AFFILIATE
TRANSACTIONS
|
1.
|
Agreement
for Raw Material Sourcing between LSB Industries, Inc. (“LSB”) and its
subsidiaries.
|
|
2.
|
Tax
Sharing Agreement between LSB and ThermaClime, Inc. (f/k/a ClimaChem, Inc.
(“TCI”)).
|
|
3.
|
Tax
Sharing Agreement between LSB and ClimateCraft, Inc.
(“CLC”).
|
|
4.
|
Management
Agreement between LSB and TCI.
|
|
5.
|
Lease
Agreement between Prime Holdings Corporation (“PHC”) and International
Environmental Corporation (“IEC”) for property at 0000 Xxxx X-00,
XXX.
|
|
6.
|
Lease
Agreement between Prime Holdings Corporation (“PHC”) and ThermaClime
Technologies, Inc. (“TTI”) for property at 0000 Xxxx X-00,
XXX.
|
|
7.
|
Railcar
Services Agreement between Prime Financial Corporation (“PFC”) and El
Dorado Chemical Company (“EDC”).
|
|
8.
|
Industrial
Plant Lease between PFC and Climate Master, Inc. (“CLM”) for property at
0000 Xxxx Xxxxx Xxxxxxxxx, XXX.
|
|
9.
|
Equipment
Lease between IEC and PFC Re: Laser Center, 2 Pullmax Press Brakes and
accessories
|
|
10.
|
Equipment
Lease between IEC and PFC Re: Cabinet & Steel Rack w/ Amada Turret
Press Dies and shop carts with Amada Turret Punch Press
tooling.
|
|
11.
|
Equipment
Lease between IEC and PFC Re: Bolina Cut-to-Length, 2 Optiflex 110/08
Pullmax CNC Press Brakes, and 1 Vertical Xxxxxx Hairpin
Xxxxxx.
|
|
12.
|
Equipment
Lease between IEC and PFC Re: Trumpf Laser 3040
Plus.
|
|
13.
|
Equipment
Lease between IEC and PFC Re: T-Drill SP-55 Tube End
Spinner.
|
|
14.
|
Equipment
Lease between IEC and PFC Re: Security
System.
|
|
15.
|
Equipment
Lease between IEC and PFC Re: High Takt Assembly
Line.
|
|
16.
|
Equipment
Lease between CLM and PFC Re: IPCS
Equipment
|
Page 1 of
5
|
17.
|
Equipment
Lease between CLM and PFC Re: Optima Press Brake and
accessories.
|
|
18.
|
Equipment
Lease between CLM and PFC Re: Amada Vipros 868 King, Turret Punch Press
and accessories.
|
|
19.
|
Equipment
Lease between CLM and PFC Re: ECI
equipment.
|
|
20.
|
Equipment
Lease between CLM and PFC Re: 1996 Amada FCXBIII-8025 CNC Press
Brake.
|
|
21.
|
Equipment
Lease between CLM and PFC Re: Model HFB/1003/8 Amada Press
Brake.
|
|
22.
|
Equipment
Lease between CLM and PFC Re: Model HFB/1003/8 Amada Press
Brake.
|
|
23.
|
Equipment
Lease between CLM and PFC Re: Procix
equipment.
|
|
24.
|
Equipment
Lease between CLM and PFC Re: Trumpf 3040 Laser
System.
|
|
25.
|
Equipment
Lease between CLM and PFC Re: Trumpf 3040 Laser
System.
|
|
26.
|
Equipment
Lease between CLM and PFC Re: RAIDZone GangStor
System.
|
|
27.
|
Equipment
Lease between CLM and PFC Re: Blanking
Shear.
|
|
28.
|
Equipment
Lease between CLM and PFC Re: Amada 386 King, Vipros 30 CNC Turret
Punch
|
|
29.
|
Equipment
Lease between CLM and PFC Re: Optigun
equipment.
|
|
30.
|
Equipment
Lease between CLM and PFC Re: Xxxx Oak Copper
Cut.
|
|
31.
|
Equipment
Lease between CLM and PFC Re: Chiyoda SP-25ST Tube
xxxxxx
|
|
32.
|
Equipment
Lease between CLM and PFC Re: Amada FBD-125 Press
Brake.
|
|
33.
|
Equipment
Lease between CLM and PFC Re: Trumpf Laser L3040 Laser Cutting
Machine.
|
|
34.
|
Equipment
Lease between CLM and PFC Re: Trumpf Trulaser
3530.
|
|
35.
|
Equipment
Lease between CLM and PFC Re: Xxxxxxxxx Xxxx Nirvana Compressor
System.
|
|
36.
|
Equipment
Lease between CLM and PFC Re: Gamma Wire Processing
System.
|
Page 2 of
5
|
37.
|
Equipment
Lease between CLM and PFC Re: Power Spray Stainless
Washer.
|
|
38.
|
Equipment
Lease between CLM and PFC Re: Three (3) Amada Press
Brakes.
|
|
39.
|
Equipment
Lease between CLM and IEC Re: Trumpf Laser 3040
Plus.
|
|
40.
|
Equipment
Sublease between LSB and CLM Re: Blanking Shear (leased by LSB from
PFC).
|
|
41.
|
Equipment
Sublease between CLC and PFC for Trumpf Punching
Machine.
|
|
42.
|
Equipment
Lease between CLC and PFC Re: 1999 Amada HFB 1254 Promecam CNC Press
Brake.
|
|
43.
|
Equipment
Lease between CLC and PFC Re: Trumpf Tooling
Set.
|
|
44.
|
Equipment
Lease between CLC and PFC Re: 2
Accushears.
|
|
45.
|
Equipment
Lease between CLC and PFC Re: Trumpf TC2020 Punch
Machine.
|
|
46.
|
Equipment
Lease between CLC and PFC Re: Amada CNC Hydraulic Press
Brake.
|
|
47.
|
Equipment
Lease between TTI and PFC Re: Continental Belt
Washer.
|
|
48.
|
Equipment
Lease between TTI and PFC Re: Xxxx Oak Fin
Die.
|
|
49.
|
Equipment
Lease between EDC and PFC Re: 2004 Chevy
Impala.
|
|
50.
|
Equipment
Lease between EDC and PFC Re: 2002 International Spreader
Truck.
|
|
51.
|
Plant
Equipment Lease between EDC and DSN
Corporation
|
|
52.
|
Equipment
Lease between Trison Construction, Inc. (“Trison”) and PFC
Re: 2 Xxxx Deer Gators and 3 trailers with dove
tail.
|
|
53.
|
Services
Agreements between LSB and the following
subsidiaries:
|
|
a.
|
Chemex
II Corp.
|
|
b.
|
Koax
Corp.
|
|
c.
|
Climate
Master, Inc.
|
|
d.
|
International
Environmental Corporation
|
|
e.
|
The
Climate Control Group, Inc.
|
|
f.
|
LSB
Chemical Corp.
|
|
g.
|
ClimateCraft,
Inc.
|
|
h.
|
El
Dorado Chemical Company
|
Page 3 of
5
|
i.
|
Chemex
I Corp.
|
|
j.
|
ThermaClime,
Inc.
|
|
k.
|
DSN
Corporation
|
|
l.
|
ThermaClime
Technologies, Inc.
|
|
m.
|
XpediAir,
Inc.
|
|
n.
|
Trison
Construction, Inc.
|
|
54.
|
Precious
Metals Lease between LSB and EDC.
|
|
55.
|
Exclusive
License Agreement Between CLC and ClimateCraft Technologies,
Inc.
|
|
56.
|
Assignment
of Option to Purchase between CLM and PFC Re: CLM Facility Located at 0000
X.X. 00xx Xxxxxx, Xxxxxxxx City from Raptor Master
LLC.
|
|
57.
|
Consulting
Agreements between LSB Chemical Corp. (“LSB Chemical”) and various
affiliates.
|
|
58.
|
Lease
between Summit Machinery Company (“SMC”) and Trison for office space at
0000 X.X. 00xx Xxxxxx, XXX.
|
|
59.
|
Lease
between XpediAir, Inc. and SMC at 0000 XX 00xx Xxxxxx,
XXX.
|
|
60.
|
Warehouse
Lease between CLM and SMC at 0000 XX 00xx Xxxxxx,
XXX.
|
|
61.
|
Warehouse
Lease between Summit Machine Tool Manufacturing Corp. (“Summit”) and
ClimaCool Corp. at 000 Xxxxx Xxxxxxx,
XXX.
|
|
62.
|
Warehouse
Lease between Summit and CLC at 0000 XX 0xx Xxxxxx,
XXX.
|
|
63.
|
Capital
Lease Agreement with Right of Transfer of Title between Summit and CLC for
CLC facility in OKC.
|
|
64.
|
Lease
of drilling equipment from LSB Holdings, Inc. to
Trison.
|
|
65.
|
Lease
of office space from SMC to TCI at 0000 XX 00xx Xxxxxx,
XXX.
|
|
66.
|
Lease
of office space from PFC to TCI at 00 Xxxxx Xxxxxxxxxxxx Xxxxxx,
XXX.
|
|
67.
|
Lease
of office space from TCI to LSB at 00 Xxxxx Xxxxxxxxxxxx Xxxxxx,
XXX.
|
|
68.
|
Lease
of building from LSB to Koax Corp. (“Koax”) at 000 Xxxxx Xxxxxxx,
XXX.
|
|
69.
|
Lease
of warehouse space from Summit to Koax at 000 Xxxxx Xxxxxxx,
XXX.
|
Page 4 of
5
|
70.
|
Lease
of office space from PFC to LSB Chemical at 00 Xxxxx Xxxxxxxxxxxx Xxxxxx,
XXX.
|
|
71.
|
Lease
of office space from SMC to The Climate Control Group, Inc. (“CCG”) at
0000 XX 00xx Xxxxxx, XXX.
|
|
72.
|
Lease
of office space from SMC to IEC at 0000 XX 00xx Xxxxxx,
XXX.
|
|
73.
|
Computer
rental from LSB to TCI.
|
|
74.
|
Auto
rental from LSB to TCI.
|
|
75.
|
Auto
rental from LSB to CCG.
|
|
76.
|
Auto
rental from PFC to CCG.
|
|
77.
|
See
Schedules 5.05, 7.03 and 7.05.
|
Page 5 of
5
SCHEDULE
7.09
RESTRICTIVE
AGREEMENTS
|
1.
|
Amended
and Restated Loan and Security Agreement dated as of November ____, 2007,
by and among ThermaClime, Inc. and each of the Subsidiaries of ThermaClime
identified on the signature pages thereof, LSB Industries, Inc., the
lenders identified on the signature pages thereof and Xxxxx Fargo
Foothill, Inc., as the arranger and administrative agent for the Lenders,
as amended.
|
|
2.
|
Equipment
Purchase and Security Agreement between International Environmental
Corporation and Xxxxx America, Inc., dated June 27,
2003.*
|
|
3.
|
Capital
Lease Agreement with Right of Transfer of Title by and between Summit
Machine Tool Manufacturing Corp. and ClimateCraft, Inc., effective
December 31, 1999, as amended.*
|
|
4.
|
Loan
Agreement between The City of Oklahoma City and ClimateCraft, Inc., dated
December 23, 1999.*
|
*These
agreements relate to equipment and property not part of
Collateral. The restrictions (including lien restrictions) are
limited to the equipment and property that are the subject of such
agreements.
Schedule
11.02
Addresses
for Notices; Payment Information
BORROWERS: PARENT:
|
ThermaClime,
Inc.
00
Xxxxx Xxxxxxxxxxxx Xxxxxx
Xxxxxxxx
Xxxx, Xxxxxxxx 00000
Attention: Xxxx
X. Xxxxxx, Ex. V.P.
Tel: 000-000-0000
Fax: 000-000-0000
with
copy to:
ThermaClime,
Inc.
00
Xxxxx Xxxxxxxxxxxx Xxxxxx
Xxxxxxxx
Xxxx, Xxxxxxxx 00000
Attention: Xxxxx
Xxxxx, General Counsel
Tel: 000-000-0000
Fax: 000-000-0000
|
LSB
Industries, Inc.
00
Xxxxx Xxxxxxxxxxxx Xxxxxx
Xxxxxxxx
Xxxx, Xxxxxxxx 00000
Attention: Xxxx
X. Xxxxxx, Ex. V.P.
Tel: 000-000-0000
Fax: 000-000-0000
with
copy to:
LSB
Industries, Inc.
00
Xxxxx Xxxxxxxxxxxx Xxxxxx
Xxxxxxxx
Xxxx, Xxxxxxxx 00000
Attention: Xxxxx
Xxxxx, General Counsel
Tel: 000-000-0000
Fax: 000-000-0000
|
AGENTS:
|
Addresses for Notices
|
Payment Information
|
|
Banc
of America Leasing & Capital LLC, as
Collateral Agent
Mail
Code: GA3-003-04-01
Xxxxxxxxx
Xxxxxx Xxxxxxxx
0000
Xxxxxxxxx Xxxx
Xxxxxx
XX 00000-0000
Attn:
Xxxxxxx X. XxXxxxxx
Vice
President - Operations Manager
Tel:
000-000-0000
Fax:
000-000-0000
|
Bank: Bank
of America
Address:
Concord, CA
ABA:
026 009 593
Account
No: 1233401992
Account
Name: Banc of America Leasing & Capital, LLC
Attention: Xxxxx
Xxxxxxx
Reference: ThermaClime
|
|
Banc
of America Leasing & Capital LLC, as Administrative Agent
Mail
Code: MA5-100-32-01
000
Xxxxxxx Xx
Xxxxxx
XX 00000
Attn: Xxxxxxxxx
X. Xxxxxx
Vice
President - Group Operations Manager
Tel:
000-000-0000
Fax:
000-000-0000
|
Bank: Bank
of America
Address:
Concord, CA
ABA:
026 009 593
Account
No: 1233401992
Account
Name: Banc of America Leasing & Capital, LLC
Attention: Xxxxx
Xxxxxxx
Reference: ThermaClime
|
Page 1 of
3
|
Addresses for Notices
|
Payment
Information
|
|
Bank
of Utah, as Payment Agent
ATTN: Corporate
Trust Services
000
X. Xxxxx Xxxxxx, Xxxxx 000
Xxxx
Xxxx Xxxx, XX 00000
Phone: (000)
000-0000
Fax: (000)
000-0000
|
Bank: Bank
of Utah
ABA
No. 000-000-000
Acct.
No. 01020296
Re: ThermaClime
Acct. No. 8000099
|
|
LENDERS:
|
|
|
Addresses for Notices
|
|
|
Banc
of America Leasing & Capital LLC,
Northeast
Center Building
Mail
Code: GA3-003-04-01
0000
Xxxxxxxxx Xxxx
Xxxxxx
XX 00000-0000
Attn:
Xxxxxxx X. XxXxxxxx
Vice
President - Operations Manager
Tel:
000-000-0000
Fax:
000-000-0000
|
|
|
With
Copy to:
Banc
of America Leasing & Capital LLC
Xxx
Xxxxxxxxx Xxxxx, 0xx
Xxxxx
Mail
Code: R11-537-02-01
xxxx://xxxxxxx.xxxxxxxxxxxxx.xxx/xxxxxxxxxxxx.xxx?xxxXxxxx0Xxxxxxxxxxxxx&xxxXxxxx0Xxxxxxx&xxxXxxxx0X
Xxxxxxxxxx,
XX 00000
Attn: Xxx
Xxxxxxx
Vice
President - Credit Underwriting
Tel:
000-000-0000
Fax:
000-000-0000
|
Page 2 of
3
Addresses for
Notices
|
Xxxxxxx
Xxxxx Capital, a Division of Xxxxxxx Xxxxx Business Financial Services
Inc.
000
X. XxXxxxx Xxxxxx, 00xx
Xxxxx
Xxxxxxx,
XX 00000
Attention: Xxxx
Xxxxxxx
Vice
President, Group Credit Manager
Tel: 000-000-0000
Fax: 000-000-0000
Email: Xxxx_Xxxxxxx@xx.xxx
|
|
| Arvest
Bank
0000
X. Xxxxxxx Xxxxxxxxx
Xxxxxxxx
Xxxx, XX 00000
Attn: Xxxxx
Xxxx
Xx.
Vice President & Corporate Division Manager
Tel: 000-000-0000
Fax: 000-000-0000
Email: xxxxx@xxxxxx.xxx
|
Page 3 of
3
EXHIBIT
A
FORM
OF TERM NOTE
$_____________ _____________,
2007
FOR VALUE
RECEIVED, each of THERMACLIME, INC. (“ThermaClime”) and
each of the undersigned Affiliates of ThermaClime (each a “Borrower” and
collectively the “Borrowers”) hereby
jointly and severally promises to pay to _____________________ or registered
assigns (the “Lender”), in
accordance with the provisions of the Agreement (as hereinafter defined), the
principal amount of the Term Loan made by the Lender to the Borrower under that
certain Term Loan Agreement, dated as of ___________, 2007 (as amended,
restated, extended, supplemented or otherwise modified in writing from time to
time, the “Agreement;” the terms
defined therein being used herein as therein defined), among the Borrowers, each
lender from time to time party hereto (collectively, the “Lenders” and
individually, a “Lender”), Banc of
America Leasing & Capital, LLC, as Administrative Agent and Collateral
Agent, and Bank of Utah, as Payment Agent.
Each
Borrower, jointly and severally, promises to pay interest on the unpaid
principal amount of such Lender’s Term Loan from the date of such Term Loan
until such principal amount is paid in full, at such interest rates and at such
times as provided in the Agreement. All payments of principal and
interest shall be made to the Collateral Agent for the account of the Lender at
the Collateral Agent’s Office. If any amount is not paid in full when
due hereunder, such unpaid amount shall bear interest, to be paid upon demand,
from the due date thereof until the date of actual payment (and before as well
as after judgment) computed at the per annum rate set forth in the
Agreement.
This note
is one of the Term Notes referred to in the Agreement, is entitled to the
benefits thereof and may be prepaid in whole or in part subject to the terms and
conditions provided therein. This Term Note is also entitled to the
benefits of the Guaranty and is secured by the Collateral
Documents. Upon the occurrence and continuation of one or more of the
Events of Default specified in the Agreement, all amounts then remaining unpaid
on this Term Note shall become, or may be declared to be, immediately due and
payable all as provided in the Agreement. The Term Loan made by the
Lender shall be evidenced by one or more loan accounts or records maintained by
the Lender in the ordinary course of business. The Lender may also
attach schedules to this Term Note and endorse thereon the date, amount,
currency and maturity of its Term Loans and payments with respect
thereto.
Each
Borrower, for itself, its successors and assigns, hereby waives diligence,
presentment, protest and demand and notice of protest, demand, dishonor and
non-payment of this Term Note.
Exhibit
A-1
THIS TERM
NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF NEW YORK.
THERMACLIME,
INC.
CHEROKEE
NITROGEN HOLDINGS, INC.,
NORTHWEST
FINANCIAL CORPORATION,
CHEMEX I
CORP.,
CHEMEX II
CORP.,
CHEROKEE
NITROGEN COMPANY,
CLIMACOOL
CORP.,
CLIMATECRAFT,
INC.,
CLIMATE
MASTER, INC.,
DSN
CORPORATION,
EL DORADO
CHEMICAL COMPANY,
INTERNATIONAL
ENVIRONMENTAL CORPORATION,
KOAX
CORP.,
LSB
CHEMICAL CORP.,
THE
CLIMATE CONTROL GROUP, INC.,
TRISON
CONSTRUCTION, INC.,
THERMACLIME
TECHNOLOGIES, INC.,
XPEDIAIR,
INC.
By:
Name:
Title:
Exhibit
A-2
LOANS
AND PAYMENTS WITH RESPECT THERETO
|
Date
|
Type
of
Loan Made
|
Amount
of
Loan Made
|
End
of
Interest Period
|
Amount
of
Principal
or
Interest
Paid
This Date
|
Outstanding
Principal
Balance
This Date
|
Notation
Made By
|
|
_________
|
_________
|
_________
|
_____________
|
_____________
|
___________
|
________
|
|
_________
|
_________
|
_________
|
_____________
|
_____________
|
___________
|
________
|
|
_________
|
_________
|
_________
|
_____________
|
_____________
|
___________
|
________
|
|
_________
|
_________
|
_________
|
_____________
|
_____________
|
___________
|
________
|
|
_________
|
_________
|
_________
|
_____________
|
_____________
|
___________
|
________
|
|
_________
|
_________
|
_________
|
_____________
|
_____________
|
___________
|
________
|
|
_________
|
_________
|
_________
|
_____________
|
_____________
|
___________
|
________
|
|
_________
|
_________
|
_________
|
_____________
|
_____________
|
___________
|
________
|
|
_________
|
_________
|
_________
|
_____________
|
_____________
|
___________
|
________
|
|
_________
|
_________
|
_________
|
_____________
|
_____________
|
___________
|
________
|
|
_________
|
_________
|
_________
|
_____________
|
_____________
|
___________
|
________
|
|
_________
|
_________
|
_________
|
_____________
|
_____________
|
___________
|
________
|
|
_________
|
_________
|
_________
|
_____________
|
_____________
|
___________
|
________
|
|
_________
|
_________
|
_________
|
_____________
|
_____________
|
___________
|
________
|
|
_________
|
_________
|
_________
|
_____________
|
_____________
|
___________
|
________
|
|
_________
|
_________
|
_________
|
_____________
|
_____________
|
___________
|
________
|
|
_________
|
_________
|
_________
|
_____________
|
_____________
|
___________
|
________
|
|
_________
|
_________
|
_________
|
_____________
|
_____________
|
___________
|
________
|
|
_________
|
_________
|
_________
|
_____________
|
_____________
|
___________
|
________
|
|
_________
|
_________
|
_________
|
_____________
|
_____________
|
___________
|
________
|
|
_________
|
_________
|
_________
|
_____________
|
_____________
|
___________
|
________
|
|
_________
|
_________
|
_________
|
_____________
|
_____________
|
___________
|
________
|
|
_________
|
_________
|
_________
|
_____________
|
_____________
|
___________
|
________
|
|
_________
|
_________
|
_________
|
_____________
|
_____________
|
___________
|
________
|
|
_________
|
_________
|
_________
|
_____________
|
_____________
|
___________
|
________
|
Exhibit A
of 3
EXHIBIT
B
FORM
OF COMPLIANCE CERTIFICATE
Financial Statement
Date: ______, ____
To: Bank
of Utah, as Payment Agent
Ladies
and Gentlemen:
Reference
is made to that certain Term Loan Agreement, dated as of ____________, 2007 (as
amended, restated, extended, supplemented or otherwise modified in writing from
time to time, the “Agreement;” the terms
defined therein being used herein as therein defined), among THERMACLIME, INC.
(“ThermaClime”)
and certain Affiliates of ThermaClime, as borrowers (with ThermaClime,
collectively, the “Borrowers” and each a
“Borrower”),
LSB Industries, Inc., as guarantor (“Parent”), each lender
from time to time party hereto (collectively, the “Lenders” and
individually, a “Lender”), Banc of
America Leasing & Capital, LLC, as Administrative Agent and Collateral
Agent, and Bank of Utah, as Payment Agent.
The
undersigned hereby certifies as of the date hereof that he/she is the [chief executive officer/chief
financial officer/treasurer/controller] of each of Parent and
ThermaClime, and that, as such, he/she is authorized to execute and deliver this
Certificate to the Collateral Agent on the behalf of each of Parent and
ThermaClime, and that:
[Use
following paragraph 1 for fiscal year-end financial
statements]
1. Each
of Parent and ThermaClime has delivered the year-end audited financial
statements required by Section 6.01(a)
of the Agreement for the fiscal year of Parent or ThermaClime, as applicable,
ended as of the above date, together with the report and opinion of an
independent certified public accountant required by such section.
[Use
following paragraph 1 for fiscal quarter-end financial
statements]
1. Each
of Parent and ThermaClime has delivered the unaudited financial statements
required by Section 6.01(b)
of the Agreement for the fiscal quarter of Parent or ThermaClime, as applicable,
ended as of the above date. Such financial statements fairly present
the financial condition, results of operations and cash flows of Parent or
ThermaClime, as applicable, and its Subsidiaries in accordance with GAAP as at
such date and for such period, subject only to normal year-end audit adjustments
and the absence of footnotes.
2. The
undersigned has reviewed and is familiar with the terms of the Agreement and has
made, or has caused to be made under his/her supervision, a detailed review of
the transactions and condition (financial or otherwise) of Parent and the
Borrowers during the accounting period covered by such financial
statements.
3. A
review of the activities of Parent and the Borrowers during such fiscal period
has been made under the supervision of the undersigned with a view to
determining whether during such fiscal period a Default has occurred under the
Loan Documents, and
Exhibit
B-1
[select
one:]
[to
the knowledge of the undersigned, during such fiscal period each of Parent and
the Borrowers was in compliance with each covenant and condition of the Loan
Documents applicable to it, and no Default has occurred and is
continuing.]
--or--
[to
the knowledge of the undersigned, during such fiscal period the following is a
list of each Default that occurred and its nature and status:]
4. The
financial covenant analyses and information set forth on Schedule 1
attached hereto are true and accurate on and as of the date of this
Certificate.
IN
WITNESS WHEREOF, the undersigned has executed this Certificate as of _________,
200[_].
THERMACLIME,
INC.
By:
Name:
Title:
LSB
INDUSTRIES, INC.
By:
Name:
Title:
Exhibit
B-2
SCHEDULE
1
to the
Compliance Certificate
1. Consolidated
Leverage Ratio. [If
applicable.]
(a) The
Consolidated Leverage Ratio of ThermaClime and its Subsidiaries (the
“ThermaClime Entities”) for such period is calculated as follows:
|
|
(i)
|
Consolidated
Total Indebtedness as of the financial statement date:
|
$______________
|
|
|
(ii)
|
Borrowers’
Consolidated EBITDA for such period:
|
$______________
|
The ratio
of item (i) to (ii) = Consolidated Leverage
Ratio = ___
: ___
(b) The
Consolidated Leverage Ratio set forth above [is/is not] greater than or
equal to the amount set forth in Section 7.11(a) of
the Loan Agreement for such period, which is 4.50 to 1.00.
2. Consolidated
Fixed Charge Coverage Ratio.
(a) The
Consolidated Fixed Charge Coverage Ratio of the ThermaClime Entities for such
period is calculated as follows:
|
|
(i)
|
Consolidated
EBITDA of the ThermaClime Entities for the most recently completed four
fiscal quarters (the “Measurement Period”):
|
$_________________
|
|
|
(ii)
|
Aggregate
amount of all Capital Expenditures made during the Measurement Period by
the ThermaClime Entities on a consolidated basis ($_________________), but
excluding any such payments to the extent financed through the incurrence
of additional Indebtedness
($_________________):$________________
|
|
|
(iii)
|
Aggregate
amount of federal, state, local and foreign income taxes paid in cash, in
each case of or by the TheramClime Entities for the most recently
completed Measurement Period:
|
$________________
|
|
|
(iv)
|
Consolidated
Interest Charges:
|
$________________
|
|
|
(v)
|
Aggregate
principal amount of all regularly scheduled principal payments or
redemptions or similar acquisitions for value of outstanding debt for
borrowed money for ThermaClime on a consolidated basis during such
Measurement Period1:
|
$________________
|
1
Excluding (a) prepayments of principal under the Revolving Credit Agreement
which are not accompanied by or give rise to a reduction in the aggregate
outstanding commitments under the Revolving Credit Agreement and not
Exhibit
B-3
|
|
(vi)
|
All
amounts paid or payable by the ThermaClime Entities on Capitalized Lease
Obligations having a scheduled due date during such Measurement
Period:
|
$_____________
|
|
|
(vii)
|
Dividends
paid by ThermaClime to Parent during such Measurement
Period:
|
$_____________
|
The ratio
of items (i) minus (ii) minus (iii) divided by the sum of
items (iv) plus
(v) plus (vi) =
Consolidated Fixed Charge Coverage Ratio ___
: ___
(b) The
Consolidated Fixed Charge Coverage Ratio set forth above [is/is not] greater than or
equal to the amount set forth in Section 7.11(b) of
the Loan Agreement for the Measurement Period, which is 1.10 to
1.00.
including the final scheduled payment of amounts due under the
Revolving Credit Agreement at maturity and (b) payment at maturity of the
Indebtedness of ThermaClime to Parent under the $6,950,000 10 3/4 % bonds
maturing in November 2007, provided that Parent is the sole holder of such
Indebtedness and such Indebtedness is at all times subject to the terms of the
Intercompany Loan Subordination Agreement.
Exhibit
B-4
EXHIBIT
C
FORM
OF BORROWING NOTICE
Date: ___________,
2007
To: Bank
of Utah, as Payment Agent
Ladies
and Gentlemen:
Reference
is made to that certain Term Loan Agreement, dated as of __________, 2007 (as
amended, restated, extended, supplemented or otherwise modified in writing from
time to time, the “Agreement;” the terms
defined therein being used herein as therein defined), among THERMACLIME, INC.
(“ThermaClime”)
and certain Affiliates of ThermaClime, as borrowers (collectively, the “Borrowers” and each a
“Borrower”),
LSB Industries, Inc., as guarantor, each lender from time to time party hereto
(collectively, the “Lenders” and
individually, a “Lender”), Banc of
America Leasing & Capital, LLC, as Administrative Agent and Collateral
Agent, and Bank of Utah, as Payment Agent.
The
undersigned Borrowers hereby request the borrowing of the Term
Loans:
1. On
______________________ (a Business Day at least one (1) Business Day following
the date of this notice).
2. In
the amount of $________________.
3. The
proceeds of which shall be disbursed as follows:
[INCLUDE WIRE TRANSFER
INSTRUCTIONS]
THERMACLIME,
INC.
CHEROKEE
NITROGEN HOLDINGS, INC.,
NORTHWEST
FINANCIAL CORPORATION,
CHEMEX I
CORP.,
CHEMEX II
CORP.,
CHEROKEE
NITROGEN COMPANY,
CLIMACOOL
CORP.,
CLIMATECRAFT,
INC.,
CLIMATE
MASTER, INC.,
DSN
CORPORATION,
EL DORADO
CHEMICAL COMPANY,
INTERNATIONAL
ENVIRONMENTAL CORPORATION,
KOAX
CORP.,
LSB
CHEMICAL CORP.,
THE
CLIMATE CONTROL GROUP, INC.,
TRISON
CONSTRUCTION, INC.,
THERMACLIME
TECHNOLOGIES, INC.,
XPEDIAIR,
INC.
By:
Name:
Title:
EXHIBIT
D
This
Assignment and Assumption (this “Assignment and
Assumption”) is dated as of the Effective Date set forth below and is
entered into by and between [the][each]
2 Assignor
identified in item 1 below ([the][each, an] “Assignor”) and
[the][each]
3 Assignee identified in item 2 below ([the][each, an]
“Assignee”). [It
is understood and agreed that the rights and obligations of [the Assignors][the
Assignees]
4 hereunder are several and not joint.]
5 Capitalized terms used but not defined herein
shall have the meanings given to them in the Term Loan Agreement identified
below (the “Loan
Agreement”), receipt of a copy of which is hereby acknowledged by the
Assignee. The Standard Terms and Conditions set forth in Annex 1
attached hereto are hereby agreed to and incorporated herein by reference and
made a part of this Assignment and Assumption as if set forth herein in
full.
For an
agreed consideration, [the][each] Assignor hereby irrevocably sells and assigns
to [the Assignee][the respective Assignees], and [the][each] Assignee hereby
irrevocably purchases and assumes from [the Assignor][the respective Assignors],
subject to and in accordance with the Standard Terms and Conditions and the Loan
Agreement, as of the Effective Date inserted by the Collateral Agent as
contemplated below (i) all of [the Assignor’s][the respective Assignors’] rights
and obligations in [its capacity as a Lender][their respective capacities as
Lenders] under the Loan Agreement, the Loan Documents and any other documents or
instruments delivered pursuant thereto to the extent related to the amount and
percentage interest identified below of all of such outstanding rights and
obligations of [the Assignor][the respective Assignors] under the respective
facilities identified below and (ii) to the extent permitted to be assigned
under applicable law, all claims, suits, causes of action and any other right of
[the Assignor (in its capacity as a Lender)][the respective Assignors (in their
respective capacities as Lenders)] against any Person, whether known or unknown,
arising under or in connection with the Loan Agreement, any other documents or
instruments delivered pursuant thereto or the loan transactions governed thereby
or in any way based on or related to any of the foregoing, including, but not
limited to, contract claims, tort claims, malpractice claims, statutory claims
and all other claims at law or in equity related to the rights and obligations
sold and assigned pursuant to clause (i) above (the rights and obligations sold
and assigned by [the][any] Assignor to [the][any] Assignee pursuant to clauses
(i) and (ii) above being referred to herein collectively as [the][an] “Assigned
Interest”). Each such sale and assignment is without recourse to
[the][any] Assignor and, except as expressly provided in this Assignment and
Assumption, without representation or warranty by [the][any]
Assignor.
________________________________________
2 For bracketed language here and
elsewhere in this form relating to the Assignor(s), if the assignment is from a
single Assignor, choose the first bracketed language. If the
assignment is from multiple Assignors, choose the second bracketed
language.
|
1.
|
Assignor[s]:
|
|
2.
|
Assignee[s]:
|
|
|
[for
each Assignee, indicate [Affiliate][Approved Fund] of [identify
Lender]]
|
|
3.
|
Borrower(s):
|
ThermaClime,
Inc. and certain of its Affiliates
|
|
4.
|
Collateral
Agent: Banc of America Leasing & Capital, LLC, as
the collateral agent under the Loan
Agreement
|
|
5.
|
Loan
Agreement: Term Loan Agreement, dated as of ___________,
2007, among THERMACLIME, INC. and certain Affiliates of ThermaClime, as
borrowers (collectively, the “Borrowers” and
each a “Borrower”), LSB
Industries, Inc., as guarantor, each lender from time to time party hereto
(collectively, the “Lenders” and
individually, a “Lender”), Banc
of America Leasing & Capital, LLC, as Administrative Agent and
Collateral Agent, and Bank of Utah, as Payment
Agent.
|
|
6.
|
Assigned
Interest[s]:
|
|
Assignor[s]
6
|
Assignee[s]
7
|
Facility
Assigned
|
Aggregate
Amount
of
Term Loans for all Lenders
8
|
Amount
of Term Loans Assigned
|
Percentage
Assigned
of Term Loans
9
|
|
Term
Loans
|
$___________
|
$___________
|
_________%
|
||
|
Term
Loans
|
$___________
|
$___________
|
_________%
|
||
|
Term
Loans
|
$___________
|
$___________
|
_________%
|
|
7.
|
[Trade
Date:
|
__________________]10
|
Effective
Date: __________________, 20__ [TO BE INSERTED BY COLLATERAL AGENT AND WHICH
SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER
THEREFOR.]
8 Amounts in this column
and in the column immediately to the right to be adjusted by the counterparties
to take into account any payments or prepayments made between the Trade Date and
the Effective Date.
10 To
be completed if the Assignor and the Assignee intend that the minimum assignment
amount is to be determined as of the Trade Date.
Exhibit
D-2
The terms
set forth in this Assignment and Assumption are hereby agreed to:
ASSIGNOR
[NAME OF
ASSIGNOR]
By:
Title:
ASSIGNEE
[NAME OF
ASSIGNEE]
By:
Title:
[Consented
to and]11 Accepted:
BANC OF
AMERICA LEASING & CAPITAL, LLC,
as
Collateral Agent
By:
Title:
[Consented
to:]12
THERMACLIME,
INC.
By:
Title:
10 To
be added only if the consent of the Collateral Agent is required by the terms of
the Loan Agreement.
Exhibit
D-3
ANNEX
1 TO ASSIGNMENT AND ASSUMPTION
STANDARD
TERMS AND CONDITIONS FOR
1. Representations and
Warranties.
1.1. Assignor. [The][Each]
Assignor (a) represents and warrants that (i) it is the legal and beneficial
owner of [the][[the relevant] Assigned Interest, (ii) [the][such] Assigned
Interest is free and clear of any lien, encumbrance or other adverse claim
created by Assignor and (iii) it has full power and authority, and has taken all
action necessary, to execute and deliver this Assignment and Assumption and to
consummate the transactions contemplated hereby; and (b) assumes no
responsibility with respect to (i) any statements, warranties or representations
made in or in connection with the Loan Agreement or any other Loan Document,
(ii) the execution, legality, validity, enforceability, genuineness, sufficiency
or value of the Loan Documents or any collateral thereunder, (iii) the financial
condition of any Borrower, any of their Subsidiaries or Affiliates or any other
Person obligated in respect of any Loan Document or (iv) the performance or
observance by any Borrower, any of their Subsidiaries or Affiliates or any other
Person of any of their respective obligations under any Loan
Document.
1.2. Assignee. [The][Each]
Assignee (a) represents and warrants that (i) it has full power and authority,
and has taken all action necessary, to execute and deliver this Assignment and
Assumption and to consummate the transactions contemplated hereby and to become
a Lender under the Loan Agreement, (ii) it meets all the requirements to be an
assignee under the definition of “Eligible Assignee” and Sections 11.06(b)(iii),
(v) and (vi) of the Loan
Agreement (subject to such consents, if any, as may be required under Section 11.06(b)(iii)
of the Loan Agreement), (iii) from and after the Effective Date, it shall be
bound by the provisions of the Loan Agreement and other Loan Documents to which
it is bound as a Lender thereunder and, to the extent of [the][the relevant]
Assigned Interest, shall have the obligations of a Lender thereunder, (iv) it is
sophisticated with respect to decisions to acquire assets of the type
represented by [the][such] Assigned Interest and either it, or the Person
exercising discretion in making its decision to acquire [the][such] Assigned
Interest, is experienced in acquiring assets of such type, (v) it has received a
copy of the Loan Agreement, and has received or has been accorded the
opportunity to receive copies of the most recent financial statements delivered
pursuant to Section 6.01 thereof, as applicable, and such other documents and
information as it deems appropriate to make its own credit analysis and decision
to enter into this Assignment and Assumption and to purchase [the][such]
Assigned Interest, (vi) it has, independently and without reliance upon any
Agent or any other Lender and based on such documents and information as it has
deemed appropriate, made its own credit analysis and decision to enter into this
Assignment and Assumption and to purchase [the][such] Assigned Interest, and
(vii) if it is a Foreign Lender, attached hereto is any documentation required
to be delivered by it pursuant to the terms of the Loan Agreement, duly
completed and executed by [the][such] Assignee; and (b) agrees that (i) it will,
independently and without reliance upon any Agent, [the][any] Assignor or any
other Lender, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Loan Documents, and (ii) it will perform in
accordance with their terms all of the obligations which by the terms of the
Loan Documents are required to be performed by it as a Lender.
Exhibit
D-4
2. Payments. From
and after the Effective Date, the Collateral Agent shall make all payments in
respect of [the][each] Assigned Interest (including payments of principal,
interest, fees and other amounts) to [the][the relevant] Assignor for amounts
which have accrued to but excluding the Effective Date and to [the][the
relevant] Assignee for amounts which have accrued from and after the Effective
Date.
3. General
Provisions. This Assignment and Assumption shall be binding
upon, and inure to the benefit of, the parties hereto and their respective
successors and assigns. This Assignment and Assumption may be
executed in any number of counterparts, which together shall constitute one
instrument. Delivery of an executed counterpart of a signature page
of this Assignment and Assumption by telecopy shall be effective as delivery of
a manually executed counterpart of this Assignment and
Assumption. This Assignment and Assumption shall be governed by, and
construed in accordance with, the law of the State of New York.
Exhibit
D-5
EXHIBIT
E
SECURITY
AGREEMENT
This
SECURITY AGREEMENT, dated as of November 2, 2007 (as amended, supplemented,
amended and restated or otherwise modified from time to time, this “Security Agreement”),
is made by CHEROKEE NITROGEN HOLDINGS, INC., an Oklahoma corporation, NORTHWEST
FINANCIAL CORPORATION, an Oklahoma corporation, CHEROKEE NITROGEN COMPANY, an
Oklahoma corporation, DSN CORPORATION, an Oklahoma corporation, and EL DORADO
CHEMICAL COMPANY, an Oklahoma corporation, (each individually a “Grantor” and
collectively, the “Grantors”), in favor
of BANC OF AMERICA LEASING & CAPITAL LLC, as the collateral agent (together
with its successor(s) thereto in such capacity, the “Collateral Agent”)
for each of the Secured Parties.
W I T N E S S E T H :
WHEREAS,
pursuant to a Term Loan Agreement, dated as of November 2, 2007 (as amended,
supplemented, amended and restated or otherwise modified from time to time, the
“Loan
Agreement”), among ThermaClime, Inc., an Oklahoma corporation (“ThermaClime”), and
certain subsidiaries and an affiliate of ThermaClime including each of the
Grantors, as borrowers (collectively, together with ThermaClime, the “Borrowers”), LSB
Industries, Inc., as guarantor, the various financial institutions and other
Persons from time to time party thereto, Banc of America Leasing & Capital,
LLC, as administrative agent, and the Collateral Agent, the Lenders have agreed,
subject to the terms and conditions set forth in the Loan Agreement, to make
Term Loans to the Borrowers; and
WHEREAS,
as a condition precedent to the making of the Term Loans under the Loan
Agreement, each Grantor is required to execute and deliver this Security
Agreement;
NOW,
THEREFORE, for good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, and in order to induce the Lenders to make Term
Loans to the Grantors and the other Borrowers, each Grantor agrees, for the
benefit of each Secured Party, as follows:
ARTICLE
I
DEFINITIONS
SECTION
1.1. Certain
Terms. The following terms (whether or not underscored) when
used in this Security Agreement, including its preamble and recitals, shall have
the following meanings (such definitions to be equally applicable to the
singular and plural forms thereof):
“Accounts” means all
of Borrowers’ now owned or hereafter acquired right, title and interest with
respect to “accounts” (as that term is defined in the UCC), and any and all
supporting obligations in respect thereof.
“Books” means all of
each Borrower’s now owned or hereafter acquired books and records (including all
of its records indicating, summarizing, or evidencing its assets (including the
UCC Collateral) or liabilities, all of its records relating to its business
operations or financial condition, and all of its goods or General Intangibles
related to such information).
“Cherokee Collateral”
means (a) the Cherokee Plant, (b) all Material Contracts, Assigned Agreements,
Support Rights and Interests, Intellectual Property Collateral, and Permits, (c)
all data bases, skill, experience, processes, models, drawings, manuals,
materials, records and all other Cherokee General Intangibles, (d) all insurance
proceeds arising in connection with the Cherokee Plant or used in or necessary
to conduct the Facility Business or the operation or maintenance of the Facility
Assets, and (e) all Proceeds of the Cherokee Collateral described in clauses (a)
through (d) above; provided, however, the Cherokee Collateral shall not include
any of the Excluded Assets.
“Cherokee General
Intangibles” means the General Intangibles which, in whole or in part,
relate to the Cherokee Plant or are used in or necessary to conduct the Facility
Business or the operation or maintenance of the Facility Assets.
“Cherokee Plant” means
(a) the Cherokee Site and (b) the land, land improvements, buildings, Fixtures,
Equipment (including, without limitation, chemical processing equipment, office
equipment, barge unloading equipment and laboratory equipment), the Xxxxxxx
Company ammonia processing plant, the Chemical Industrial Engineers Company
nitric acid plant, the X.X. Xxxxxxxxx Company nitric acid plant, the Technip
Company UREA plant, the ammonium nitrate xxxxx plant, a pollution control and
irrigation system, cooling towers, a demineralizer, transformers, substations,
storage tanks, office furniture, computers and software, vehicles and forklift
trucks (other than rolling stock or titled vehicles), an auxiliary boiler, a
deaerator system, product storage tanks, air compressors, an electrical
substation and transformers, process plant piping, pumps and wiring,
and other tangible assets located on the Cherokee Site or used in or necessary
to the conduct of the Facility Business or the operation or maintenance of the
Facility Assets at the Cherokee Site from time to time, including, without
limitation, as described on Part A of Schedule
1.1(a).
“Cherokee Site” means
the real property described on Schedule
1.1(b).
“Collateral” is
defined in Section
2.1.
“Collateral Agent” is
defined in the preamble.
“El Dorado Collateral”
means (a) the El Dorado Plant, (b) all Material Contracts, Assigned Agreements,
Support Rights and Interests, Intellectual Property Collateral, and Permits, (c)
all data bases, data, skill, experience, processes, models, drawings, manuals,
materials, records and all other El Dorado General Intangibles, (d) all
insurance proceeds arising in connection with the El Dorado Plant or used in or
necessary to conduct the Facility Business or the operation or maintenance of
the Facility Assets, and (e) all Proceeds of the El Dorado Collateral described
in clauses (a) through (d) above; provided, however, the El Dorado Collateral
shall not include any of the Excluded Assets.1
______________________________________________
1 Final Collateral descriptions are
subject to final update and modification by the Appraiser.
- 2
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“El Dorado General
Intangibles” means General Intangibles which, in whole or in part, relate
to the El Dorado Plant or are used in or necessary to conduct the Facility
Business or the operation or maintenance of the Facility Assets.
“El Dorado Plant”
means (a) the El Dorado Site and (b) the land, land improvements, buildings,
Fixtures, Equipment (including, without limitation, chemical processing
equipment, office equipment, maintenance and machine shop equipment and
laboratory equipment), the Chemico east/west weak nitric plant, the Chemico
sulfuric acid plant, the Chemico E2 high-density ammonium nitrate xxxxx plant,
the K-T lo-density ammonium nitrate xxxxx plant, a 100 TPD mixed acids plant,
the X.X. Xxxxxxxxx nitric acid plant, the XXXX 285 TPD direct strong nitric acid
processing plant, the CB&I tank farm including ammonia storage spheres, a
refrigerated ammonia tank and ammonia storage tanks, a plant steam generation
system including Xxxxxxx & Xxxxxx processing boilers, a plant electrical
generation system including substations and transformers, a wastewater ph
neutralization system, a pollution control and irrigation system,
cooling towers, air compressors, transformers, substations, storage tanks,
office furniture, computers and software, vehicles, forklift trucks (other than
rolling stock or titled vehicles), process plant piping, pumps and wiring, and
other tangible assets located on the El Dorado Site or used in or necessary to
the conduct of the Facility Business or the operation or maintenance of the
Facility Assets at the El Dorado Site from time to time, including, without
limitation, as described on Part B of Schedule
1.1(a).
“El Dorado Site” means
the real property described on Schedule
1.1(c).
“Equipment” means all
“equipment” as such term is defined in the UCC, now owned or hereafter acquired
by any Grantor and located on the Cherokee Site or the El Dorado Site or used in
or necessary to the conduct of the Facility Business or the operation of the
Facility Assets at either of the Sites, including all such Grantor’s machinery
and equipment, including processing equipment, conveyors, machine tools, data
processing and computer equipment, including embedded software and peripheral
equipment, and all engineering, processing and manufacturing equipment, office
machinery, furniture, materials, handling equipment, tools, attachments,
accessories, automotive equipment, trailers, trucks, forklifts, molds, dies,
stamps, motor vehicles (other than rolling stock or titled vehicles), other
equipment of every kind and nature, trade fixtures and fixtures not forming a
part of real property, together with all additions and accessions thereto,
replacements therefor, all parts therefor, all substitutes for any of the
foregoing, fuel therefor, and all manuals, drawings, instructions, warranties
and rights with respect thereto, and all products and proceeds thereof and
condemnation awards and insurance proceeds with respect thereto.
“Excluded Assets”
means (i) all titled vehicles, railcars, rolling stock, Accounts, Non Facility
General Intangibles and Books, Inventory, Investment Property, and Negotiable
Collateral, (ii) all insurance proceeds relating to the assets described in
clause (i) above, and (iii) all Proceeds of the assets described in clauses (i)
and (ii) above.
“Facility Business”
means the business conducted by the Borrowers at the Cherokee Site and the El
Dorado Site.
- 3
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“Fixtures” means all
“fixtures” as such term is defined in the UCC, now owned or hereafter acquired
by any Grantor.
“General Intangibles”
means all of Grantor’s now owned or hereafter acquired right, title, and
interest with respect to “general intangibles” as that term is defined in the
UCC (including contract rights, proprietary rights, rights arising under common
law, statutes, or regulations, choses or things in action, goodwill, patents,
trade names, trademarks, servicemarks, copyrights, blueprints, drawings,
purchase orders, customer lists, route lists, rights to payment and other rights
under any royalty or licensing agreements, infringement claims, computer
programs, information contained on computer disks or tapes, software,
literature, reports, and catalogs) and any and all supporting obligations in
respect thereof.
“Grantor” and “Grantors” are defined
in the preamble.
“Intellectual Property
Collateral” means patents, patent rights, copyrights, works which are the
subject matter of copyrights, trademarks, service marks, trade names, trade
styles, patent applications, trademark applications and service xxxx
applications, trade secrets, proprietary or confidential information, inventions
(whether or not patented or patentable), technical information, procedures,
designs, knowledge and know-how used in or necessary to the conduct of the
Facility Business or the operation and maintenance of the Facility Assets from
time to time, and any licenses and rights related to any of the foregoing,
including without limitation, with respect to the Grantors, those patents,
trademarks, service marks, trade names, and copyright registrations set forth on
Schedule 3.4 to
this Security Agreement and all other rights under any of the foregoing, all
extensions, renewals, reissues, divisions, continuations, and
continuations-in-part of any of the foregoing, and all rights to xxx for past,
present and future infringement of any of the foregoing.
“Inventory” means all
Borrowers’ now owned or hereafter acquired right, title, and interest with
respect to inventory, including goods held for sale or lease or to be furnished
under a contract of service, goods that are leased by a Borrower as lessor,
goods that are furnished by a Borrower under a contract of service, and raw
materials, work in process, or materials used or consumed in a Borrower’s
business.
“Investment Property”
means all of Borrowers’ now owned or hereafter acquired right, title and
interest with respect to “investment property” as that term is defined in the
UCC, and any and all supporting obligations in respect thereof.
“Loan Agreement” is
defined in the first
recital.
“Negotiable
Collateral” means all of Borrowers’ now owned or hereafter acquired
right, title and interest with respect to letters of credit, letter of credit
rights, instruments, promissory notes, drafts, documents and chattel paper
(including electronic chattel paper and tangible chattel paper), and any and all
supporting obligations in respect thereof.
- 4
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“Non Facility General
Intangibles and Books” means General Intangibles and Books of Borrowers,
but excluding all (i) Cherokee General Intangibles, (ii) El Dorado General
Intangibles and (iii) Intellectual Property Collateral.2
“Proceeds” has the
meaning set forth in Article 9 of the UCC.
“Security Agreement”
is defined in the preamble.
SECTION
1.2. Loan Agreement
Definitions. Unless otherwise defined herein or the context
otherwise requires, terms used in this Security Agreement, including its
preamble and recitals, have the meanings provided in the Loan
Agreement.
ARTICLE
II
SECURITY
INTEREST
SECTION
2.1. Grant of Security
Interest. Each Grantor hereby grants to the Collateral Agent,
for its benefit and the ratable benefit of each other Secured Party, a
continuing security interest in all of such Grantor’s following property,
whether now or hereafter existing, owned or acquired by such Grantor, and
wherever located (collectively, the “Collateral”):
(a) the
Cherokee Collateral;
(b) the El
Dorado Collateral;
(c) all
books, records, writings, databases, information and other property relating to
or used in connection with, evidencing, embodying, incorporating or referring
to, any of the foregoing in this Section or the Facility Business;
and
(d) all
Proceeds of the foregoing and, to the extent not otherwise
included,
(i) all
payments under insurance (whether or not the Collateral Agent is the loss payee
thereof) and (ii) all tort claims relating to the foregoing.
Notwithstanding
anything hereto the contrary, the Collateral shall not include any of the
Excluded Assets.
SECTION
2.2. Security for
Obligations. This Security Agreement and the Collateral in
which the Collateral Agent for the benefit of the Secured Parties is granted a
security interest hereunder by the Grantors secure the payment and performance
of all of the Obligations.
SECTION
2.3. Grantors Remain
Liable. Anything herein to the contrary
notwithstanding:
__________________________________
2 Note to Foothill: As we discussed,
to the extent that any books, records or intellectual property items are carved
out of your collateral by clauses (i), (ii) and (iii), Foothill is given access
and a license to use these items in the Inter-Lender Agreement.
- 5
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(a) the
Grantors will remain liable under the contracts and agreements included in the
Collateral to the extent set forth therein, and will perform all of their duties
and obligations under such contracts and agreements to the same extent as if
this Security Agreement had not been executed;
(b) the
exercise by the Collateral Agent of any of its rights hereunder will not release
any Grantor from any of its duties or obligations under any such contracts or
agreements included in the Collateral; and
(c) no
Secured Party will have any obligation or liability under any contracts or
agreements included in the Collateral by reason of this Security Agreement, nor
will any Secured Party be obligated to perform any of the obligations or duties
of any Grantor thereunder or to take any action to collect or enforce any claim
for payment assigned hereunder.
SECTION
2.4. Security Interest Absolute,
etc. This Security Agreement shall in all respects be a
continuing, absolute, unconditional and irrevocable grant of security interest,
and shall remain in full force and effect until the Obligations have been
indefeasibly paid in full. All rights of the Secured Parties and the
security interests granted to the Collateral Agent (for its benefit and the
ratable benefit of each other Secured Party) hereunder, and all obligations of
the Grantors hereunder, shall, in each case, be absolute, unconditional and
irrevocable irrespective of:
(a) any lack
of validity, legality or enforceability of any Loan Document;
(b) the
failure of any Secured Party (i) to assert any claim or demand or to enforce any
right or remedy against any Loan Party or any other Person (including any other
Grantor) under the provisions of any Loan Document or otherwise, or (ii) to
exercise any right or remedy against any other guarantor (including any other
Grantor) of, or collateral securing, any Obligations;
(c) any
change in the time, manner or place of payment of, or in any other term of, all
or any part of the Obligations, or any other extension, compromise or renewal of
any Obligations;
(d) any
reduction, limitation, impairment or termination of any Obligations for any
reason, including any claim of waiver, release, surrender, alteration or
compromise, and shall not be subject to (and each Grantor hereby waives any
right to or claim of) any defense or setoff, counterclaim, recoupment or
termination whatsoever by reason of the invalidity, illegality, nongenuineness,
irregularity, compromise, unenforceability of, or any other event or occurrence
affecting, any Obligations or otherwise;
(e) any
amendment to, rescission, waiver, or other modification of, or any consent to or
departure from, any of the terms of any Loan Document;
(f) any
addition, exchange or release of any collateral or of any Person that is (or
will become) a grantor (including the Grantors hereunder) of the Obligations, or
any surrender or non-perfection of any collateral, or any amendment to or waiver
or release or addition to, or consent to or departure from, any other guaranty
held by any Secured Party securing any of the Obligations; or
- 6
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(g) any other
circumstance which might otherwise constitute a defense available to, or a legal
or equitable discharge of, any Loan Party, any surety or any
guarantor.
SECTION
2.5. Postponement of
Subrogation. Each Grantor agrees that it will not exercise any
rights against another Grantor which it may acquire by way of rights of
subrogation under any Loan Document to which it is a party until the
Indefeasible Payment and Performance of All Obligations has
occurred. No Grantor shall seek or be entitled to seek any
contribution or reimbursement from any Loan Party, in respect of any payment
made under any Loan Document, until after the Indefeasible Payment and
Performance of All Obligations has occurred. Any amount paid to such
Grantor on account of any such subrogation rights prior to the indefeasible
payment in full of the Obligations shall be held in trust for the benefit of the
Secured Parties and shall immediately be paid and turned over to the Collateral
Agent for the benefit of the Secured Parties in the exact form received by such
Grantor (duly endorsed in favor of the Collateral Agent, if required), to be
credited and applied against the Obligations, whether matured or unmatured, in
accordance with Section
6.1. In furtherance of the foregoing, at all times prior to
the Indefeasible Payment and Performance of All Obligations, such Grantor shall
refrain from taking any action or commencing any proceeding against any Loan
Party (or its successors or assigns, whether in connection with a bankruptcy
proceeding or otherwise) to recover any amounts in respect of payments made
under this Security Agreement to any Secured Party. The foregoing
provisions of this Section 2.5 are in
addition to and not by way of limitation of the provisions set forth in Article XI of the
Loan Agreement.
ARTICLE
III
REPRESENTATIONS
AND WARRANTIES
In order
to induce the Secured Parties to enter into the Loan Agreement and make the Term
Loans, the Grantors represent and warrant to each Secured Party as of the date
hereof, the date of the Borrowing Notice and the Borrowing Date, as set forth
below.
SECTION
3.1. Grantor Name, Location,
etc.
(a) The
jurisdiction in which each Grantor is located for purposes of Sections 9-301 and
9-307 of the UCC is set forth in Part A of Schedule
3.1.
(b) Each
location a secured party would have filed a UCC financing statement in the five
years prior to the date hereof to perfect a security interest in Equipment and
General Intangibles owned by such Grantor is set forth in Part B of Schedule
3.1.
(c) The
Grantors do not have any trade names (other than the respective corporate names
of the Grantors except to the extent such names or portions thereof are used in
any other trade names) other than those set forth in Part C of Schedule
3.1.
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(d) During
the four months preceding the date hereof, no Grantor has been known by any
legal name different from the one set forth on the signature page hereto, nor
has such Grantor been the subject of any merger or other corporate
reorganization, except as set forth in Part D of Schedule 3.1
hereto.
(e) Each
Grantor’s federal taxpayer identification number is (and, during the four months
preceding the date hereof, such Grantor has not had a federal taxpayer
identification number different from that) set forth in Part E of Schedule 3.1
hereto.
(f) The name
set forth on the signature page attached hereto is the true and correct legal
name (as defined in the UCC) of each Grantor.
SECTION
3.2. Ownership, No Liens,
etc. Each Grantor has rights in or the power to transfer the
Collateral, and owns its Collateral free and clear of any Lien, except for any
security interest (a) created by this Security Agreement or (b) that is a
Permitted Encumbrance. No effective UCC financing statement or other
filing similar in effect (other than Permitted Encumbrances solely with respect
to a filing similar in effect) covering all or any part of the Collateral is on
file in any recording office, except those filed in favor of the Collateral
Agent relating to this Security Agreement or as to which a duly authorized
termination statement relating to such UCC financing statement or other
instrument has been delivered to the Collateral Agent on the Closing
Date. There are no parties to the Intercompany Leases other than the
Grantors.
SECTION
3.3. Possession of
Equipment. Each Grantor has, and agrees that it will maintain,
exclusive possession of its Equipment constituting Collateral, other than (i)
Equipment in transit in the ordinary course of business and (ii) Equipment that
is in the possession or control of a warehouseman, bailee agent or other Person
(other than a Person controlled by or under common control with the applicable
Grantor) which other Person holds such Equipment in the ordinary course of its
business for purposes of repairing or maintaining such Equipment. In
the case of Equipment described in clause (ii) above, no
lessor or warehouseman of any premises or warehouse upon or in which such
Equipment is located has (i) issued any warehouse receipt or other receipt in
the nature of a warehouse receipt in respect of any such Equipment, (ii) issued
any document for any such Equipment, (iii) received notification of any Secured
Party’s interest (other than the security interest granted hereunder) in any
such Equipment or (iv) any Lien on any such Equipment.
SECTION
3.4. Intellectual Property
Collateral.
(a) In
respect of the Intellectual Property Collateral:
(i) set forth
in Part A of
Schedule 3.4
hereto is a complete and accurate list of all issued and applied-for patents and
all patent licenses owned by each Grantor and used in or necessary to the
conduct of the Facility Business or the operation of the Facility Assets,
including those that have been issued by or are on file with the United States
Patent and Trademark Office;
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(ii) set forth
in Part B of
Schedule 3.4
hereto is a complete and accurate list all registered and applied-for trademarks
and all trademark licenses owned by each Grantor and used in or necessary to the
conduct of the Facility Business or the operation of the Facility Assets,
including those that are registered, or for which an application for
registration has been made, with the United States Patent and Trademark
Office;
(iii) set forth
in Part C of
Schedule 3.4
hereto is a complete and accurate list of all registered and applied-for
copyrights and all copyright licenses owned by each Grantor and used in or
necessary to the conduct of the Facility Business or the operation of the
Facility Assets, including those that are registered, or for which an
application for registration has been made, with the United States Copyright
Office;
(iv) the
Grantors are the sole and exclusive owners of the entire and unencumbered
rights, title and interest in and to the Intellectual Property Collateral
(except for the Permitted Encumbrances), and no claim has been made that any
such Grantor is or may be, in conflict with, infringing, misappropriating,
diluting, misusing or otherwise violating any of the rights of any third party
or that challenges the ownership, use, protectability, registerability,
validity, enforceability of any Intellectual Property Collateral and, to such
Grantor’s knowledge, there is no valid basis for any such claims, and the
Grantors have not licensed the Intellectual Property Collateral to any
Affiliates or any third parties.
(b) In
respect of each Grantor:
(i) the
Intellectual Property Collateral owned by it is valid, subsisting, and
enforceable and has not been abandoned or adjudged invalid or unenforceable, in
whole or in part, and no consents from third parties are required in connection
with the collateral assignment to the Collateral Agent of any licenses
constituting Intellectual Property Collateral;
(ii) such
Grantor has made all necessary filings and recordings, including recordings in
the United States Patent and Trademark Office and the United States Copyright
Office, as appropriate, to protect its interest in (x) the Intellectual Property
Collateral that is set forth in Part B of Schedule 3.4 and (y) all other
Intellectual Property used in or necessary to the conduct of the Facility
Business or the operation of the Facility Assets, which in the case of clause
(y) would have a Material Adverse Effect if Grantor failed to make such filings
or recordings;
(iii) no action
by such Grantor is currently pending or threatened in writing which asserts that
any third party is infringing, misappropriating, diluting, misusing or voiding
any Intellectual Property Collateral and, to such Grantor’s knowledge, no third
party is infringing upon, misappropriating, diluting, misusing or voiding any
Intellectual Property Collateral owned or used by such Grantor in any material
respect, or any of its respective licensees;
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(iv) no
settlement or consents, covenants not to xxx, nonassertion assurances, or
releases have been entered into by such Grantor or to which such Grantor is
bound that adversely affects its rights to own or use any Intellectual Property
Collateral;
(v) such
Grantor has executed and delivered to the Collateral Agent, Intellectual
Property Collateral security agreements for all Intellectual Property Collateral
owned by such Grantor;
(vi) the
consummation of the transactions contemplated by the Loan Agreement and this
Security Agreement will not result in the termination or material impairment of
any of the Intellectual Property Collateral;
(vii) such
Grantor owns directly or is entitled to use by license or otherwise, all
Intellectual Property used in, or necessary for or of importance to the business
conducted at the Cherokee Plant and the El Dorado Plant.
SECTION
3.5. Validity,
etc.
(a) This
Security Agreement creates a valid security interest in the Collateral securing
the payment of the Obligations.
(b) Each
Grantor has filed or caused to be filed all UCC-1 financing statements in the
filing office for each Grantor’s jurisdiction of organization listed in
Part A of Schedule 3.1
(collectively, the “Financing
Statements”) (or has authenticated and delivered to the Collateral Agent
the Financing Statements suitable for filing in such offices) and has taken all
other:
(i) actions
necessary to obtain control of the Collateral as provided in Sections 9-104,
9-105, 9-106 and 9-107 of the UCC in accordance with Article IV;
and
(ii) actions
necessary to perfect the Collateral Agent’s security interest with respect to
any Collateral evidenced by a certificate of ownership.
(c) Upon the
filing of the Financing Statements with the appropriate agencies therefor the
security interests created under this Security Agreement shall constitute a
perfected first priority security interest in the Collateral described on such
Financing Statements in favor of the Collateral Agent on behalf of the Secured
Parties to the extent that a security interest therein may be perfected by
filing pursuant to the relevant UCC, subject only to Permitted
Encumbrances.
SECTION
3.6. Authorization, Approval,
etc. Except as have been obtained or made and are in full
force and effect, no authorization, approval or other action by, and no notice
to or filing with, any Governmental Authority, except for the Assignments and
Consents to be delivered pursuant to Section 4.01(a)(iii)(D) of the Loan
Agreement, or any other third party is required either
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(a) for the
grant by the Grantors of the security interest granted hereby or for the
execution, delivery and performance of this Security Agreement by the
Grantors;
(b) for the
perfection or maintenance of the security interests hereunder including the
first priority nature of such security interest (except with respect to the
Financing Statements or UCC-3 Continuation Statements required to be filed in
the future with respect thereof or, with respect to Intellectual Property
Collateral, the recordation of any agreements with the United States Patent and
Trademark Office or the United States Copyright Office) or the exercise by the
Collateral Agent of its rights and remedies hereunder; or
(c) for the
exercise by the Collateral Agent of the rights provided for in this Security
Agreement.
ARTICLE
IV
COVENANTS
Each
Grantor covenants and agrees that, until the indefeasible payment in full of the
Obligations, such Grantor will perform, comply with and be bound by the
obligations set forth below.
SECTION
4.1. Change of Name,
etc. No Grantor will change its name or place of incorporation
or organization or federal taxpayer identification number except upon 30 days’
prior written notice to the Collateral Agent.
SECTION
4.2. Equipment.
(a) Each
Grantor shall promptly inform the Collateral Agent of any material additions to
or deletions from its Equipment constituting Collateral. No Grantor
shall permit any of its Equipment constituting Collateral to become a Fixture
with respect to real property or to become an accession with respect to other
personal property with respect to which real or personal property the Collateral
Agent does not have a Lien except as provided for in the final paragraph of
Section 7.01 of the Loan Agreement. No Grantor will, without the
Collateral Agent’s prior written consent, alter or remove any identifying symbol
or number on any of such Grantor’s Equipment constituting
Collateral.
(b) Except as
set forth in the Loan Agreement, no Grantor shall, without the Collateral
Agent’s prior written consent, sell, license, lease as a lessor, or otherwise
dispose of any of the Grantor’s Equipment.
SECTION
4.3. As to Intellectual Property
Collateral. Each Grantor covenants and agrees to comply with
the following provisions as such provisions relate to any Intellectual Property
Collateral used in or necessary to the conduct of the Facility Business or the
operation of the Facility Assets:
(a) such
Grantor shall not (i) do or fail to perform any act whereby any of the patents
or patent licenses may lapse or become abandoned or dedicated to the public or
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unenforceable,
(ii) itself or permit any of its licensees to (A) fail to continue to use any of
the trademarks, trade names or trademark licenses in order to maintain the
Intellectual Property Collateral in full force free from any claim of
abandonment for non-use, (B) fail to maintain as in the past the quality of
products and services offered under the trademarks, trade names or trademark
licenses, or (C) do or permit any act or knowingly omit to do any act whereby
any of the trademarks, trade names or trademark licenses may lapse or become
invalid or unenforceable, or (iii) do or permit any act or knowingly omit to do
any act whereby any of the copyrights or copyright licenses or any of the trade
secrets may lapse or become invalid or unenforceable or placed in the public
domain except upon expiration of the end of an unrenewable term of a
registration thereof, unless, in the case of any of the foregoing requirements
in clauses (i),
(ii) and (iii), such Grantor
shall reasonably and in good faith determine that any of such Intellectual
Property Collateral is of negligible economic value to such Grantor or is no
longer used in or necessary to the conduct of the Facility Business or the
operation of the Facility Assets, and the loss of such Intellectual Property
Collateral would not have a Material Adverse Effect on the
business;
(b) such
Grantor shall promptly notify the Collateral Agent if it knows, or reasonably
suspects, that any application or registration relating to any material item of
the Intellectual Property Collateral may become abandoned or dedicated to the
public or placed in the public domain or invalid or unenforceable, or of any
adverse determination or development (including the institution of, or any such
determination or development in, any proceeding in the United States Patent and
Trademark Office, the United States Copyright Office or any foreign counterpart
thereof or any court) regarding such Grantor’s ownership of any Intellectual
Property Collateral, its right to register the same or to keep and maintain and
enforce the same except with respect to such Intellectual Property which such
Grantor reasonably determines is of negligible economic value to such Guarantor
or is no longer used in or necessary to the conduct of the Facility Business or
the operation of the Facility Assets;
(c) such
Grantor shall notify Collateral Agent within a reasonable period (i) of such
Grantor or any of its agents, employees, designees or licensees filing an
application for the registration of any patent or trademark constituting
Intellectual Property Collateral with the United States Patent and Trademark
Office or (ii) of such Grantor receiving, as owner or exclusive licensee, a
copyright registration constituting Intellectual Property Collateral with the
United States Copyright Office, and upon request of the Collateral Agent,
promptly execute and deliver the Trademark Security Agreement and other
documents as the Collateral Agent may request to evidence the Collateral Agent’s
security interest in such Intellectual Property Collateral;
(d) except as
permitted under clause (a) and (b) above, such Grantor shall take all reasonable
steps, including in any proceeding before the United States Patent and Trademark
Office, the United States Copyright Office, to maintain and pursue any
application (and to obtain the relevant registration) filed with respect to, and
to maintain any registration of, the Intellectual Property Collateral, including
the filing of applications for renewal, affidavits of use, affidavits of
incontestability and opposition, interference and cancellation proceedings and
the payment of fees and taxes; and
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(e) such
Grantor shall promptly, but within sixty (60) days, after it obtains an
ownership interest in any patent or trademark constituting Intellectual Property
Collateral, execute and deliver to the Collateral Agent an IP Security
Agreement, and Grantor shall promptly, but within thirty (30) days, after it
obtains an ownership interest or an exclusive license in any copyright
constituting Intellectual Property Collateral, execute and deliver to the
Collateral Agent an IP Security Agreement, and in each case such Grantor shall
execute and deliver to the Collateral Agent any other document required to
acknowledge or register, record or perfect the Collateral Agent’s interest in
any part of such item of Intellectual Property Collateral unless such Grantor
shall determine in good faith using its commercially reasonable business
judgment that any such Intellectual Property Collateral is not material and is
of negligible economic value to such Grantor.
SECTION
4.4. Further Assurances,
etc. Each Grantor agrees that, (i) from time to time at its
own expense, it will promptly execute and deliver all further instruments and
documents, and take all further action, that may be necessary or that the
Collateral Agent may request, in order to perfect, preserve and protect any
security interest granted or purported to be granted hereby or to enable the
Collateral Agent to exercise and enforce its rights and remedies hereunder with
respect to any Collateral. Without limiting the generality of the
foregoing, such Grantor will
(a) file (and
hereby authorize the Collateral Agent to file) such Financing Statements or
continuation statements, or amendments thereto, and such other instruments or
notices, as may be necessary or that the Collateral Agent may request in order
to perfect and preserve the security interests and other rights granted or
purported to be granted to the Collateral Agent hereby; and
(b) furnish
to the Collateral Agent, from time to time at the Collateral Agent’s request,
statements and schedules further identifying and describing the Collateral and
such other reports in connection with the Collateral as the Collateral Agent may
request, all in reasonable detail.
With
respect to the foregoing and the grant of the security interest hereunder, each
Grantor hereby authorizes the Collateral Agent to file one or more financing or
continuation statements, and amendments thereto, relative to all or any part of
the Collateral; and to make all relevant filings with the United States Patent
and Trademark Office and the United States Copyright Office in respect of the
Intellectual Property Collateral. Each Grantor agrees that a carbon,
photographic or other reproduction of this Security Agreement or any UCC
financing statement covering the Collateral or any part thereof shall be
sufficient as a UCC financing statement where permitted by law.
ARTICLE
V
THE
COLLATERAL AGENT
SECTION
5.1. Collateral Agent Appointed
Attorney-in-Fact. Each Grantor hereby irrevocably appoints the
Collateral Agent its attorney-in-fact, with full authority in the place and
stead of such Grantor and in the name of such Grantor or otherwise, from time to
time in the
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Collateral
Agent’s discretion, following the occurrence and during the continuance of an
Event of Default, to take any action and to execute any instrument which the
Collateral Agent may deem necessary or advisable to accomplish the purposes of
this Security Agreement, including:
(a) to ask,
demand, collect, xxx for, recover, compromise, receive and give acquittance and
receipts for moneys due and to become due under or in respect of any of the
Collateral;
(b) to
receive, endorse, and collect any drafts or other instruments, documents and
chattel paper, in connection with clause (a)
above;
(c) to file
any claims or take any action or institute any proceedings which the Collateral
Agent may deem necessary or desirable for the collection of any of the
Collateral or otherwise to enforce the rights of the Collateral Agent with
respect to any of the Collateral; and
(d) to
perform the affirmative obligations of such Grantor hereunder.
Each
Grantor hereby acknowledges, consents and agrees that the power of attorney
granted pursuant to this Section is irrevocable and coupled with an
interest.
SECTION
5.2. Grant of License to Use
Intellectual Property Collateral. For the purpose of enabling
Collateral Agent to exercise rights and remedies under Article VI hereof
(including, without limiting the terms of Article VI hereof, in order to take
possession of, hold, preserve, process, assemble, prepare for sale, market for
sale, sell or otherwise dispose of Collateral) at such time as Collateral Agent
shall be lawfully entitled to exercise such rights and remedies, each Grantor
hereby grants to Collateral Agent, for the benefit of Collateral Agent and
Lenders, which shall be effective upon the occurrence of an Event of Default and
during the continuance thereof, an irrevocable, nonexclusive license
(exercisable without payment of royalty or other compensation to such Grantor)
to use, license or sublicense any Intellectual Property Collateral now owned or
hereafter acquired by such Grantor, and wherever the same may be located, and
including in such license access to all media in which any of the licensed items
may be recorded or stored and to all computer software and programs used for the
compilation or printout thereof.
SECTION
5.3. Collateral Agent Has No
Duty. The powers conferred on the Collateral Agent hereunder
are solely to protect its interest (on behalf of the Secured Parties) in the
Collateral and shall not impose any duty on it to exercise any such
powers. Except for reasonable care of any Collateral in its
possession and the accounting for moneys actually received by it hereunder, the
Collateral Agent shall have no duty as to any Collateral or responsibility for
taking any necessary steps to preserve rights against prior parties or any other
rights pertaining to any Collateral.
ARTICLE
VI
REMEDIES
SECTION
6.1. Certain
Remedies. If any Event of Default shall have occurred and be
continuing:
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(a) The
Collateral Agent may exercise in respect of the Collateral, in addition to other
rights and remedies provided for herein or otherwise available to it, all the
rights and remedies of a Secured Party on default under the UCC (whether or not
the UCC applies to the affected Collateral) and also may
(i) take
possession of any Collateral not already in its possession without demand and
without legal process;
(ii) require
each Grantor to, and each Grantor hereby agrees that it will, at its expense and
upon request of the Collateral Agent forthwith, assemble all or part of the
Collateral as directed by the Collateral Agent and make it available to the
Collateral Agent at a place to be designated by the Collateral Agent that is
reasonably convenient to both parties,
(iii) enter
onto the property where any Collateral is located and take possession thereof
without demand and without legal process;
(iv) without
notice except as specified below, lease, license, sell or otherwise dispose of
the Collateral or any part thereof in one or more parcels at public or private
sale, at any of the Collateral Agent’s offices or elsewhere, for cash, on credit
or for future delivery, and upon such other terms as the Collateral Agent may
deem commercially reasonable. Each Grantor agrees that, to the extent
notice of sale shall be required by law, at least ten days’ prior notice to such
Grantor of the time and place of any public sale or the time after which any
private sale is to be made shall constitute reasonable
notification. The Collateral Agent shall not be obligated to make any
sale of Collateral regardless of notice of sale having been
given. The Collateral Agent may adjourn any public or private sale
from time to time by announcement at the time and place fixed therefor, and such
sale may, without further notice, be made at the time and place to which it was
so adjourned.
(b) All cash
Proceeds received by the Collateral Agent in respect of any sale of, collection
from, or other realization upon, all or any part of the Collateral shall be
applied by the Collateral Agent against, all or any part of the Obligations as
set forth in Section 8.03 of the Loan Agreement.
(c) The
Collateral Agent may
(i) transfer
all or any part of the Collateral into the name of the Collateral Agent or its
nominee, with or without disclosing that such Collateral is subject to the Lien
hereunder,
(ii) notify
the parties obligated on any of the Collateral to make payment to the Collateral
Agent of any amount due or to become due thereunder,
(iii) enforce
collection of any of the Collateral by suit or otherwise, and surrender, release
or exchange all or any part thereof, or compromise or extend or
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renew for
any period (whether or not longer than the original period) any obligations of
any nature of any party with respect thereto,
(iv) endorse
any checks, drafts, or other writings in any Grantor’s name to allow collection
of the Collateral,
(v) take
control of any Proceeds of the Collateral, and
(vi) execute
(in the name, place and stead of any Grantor) endorsements, assignments and
other instruments of conveyance or transfer with respect to all or any of the
Collateral.
(d) Without
limiting the foregoing, in respect of the Intellectual Property
Collateral:
(i) upon the
request of the Collateral Agent, each Grantor shall execute and deliver to the
Collateral Agent an assignment or assignments of the Intellectual Property
Collateral, subject (in the case of any licenses thereunder) to any valid and
enforceable requirements to obtain consents from any third parties, and such
other documents as are necessary or appropriate to carry out the intent and
purposes hereof;
(ii) each
Grantor agrees that the Collateral Agent may file applications and maintain
registrations for the protection of the Intellectual Property Collateral and/or
bring suit in the name of such Grantor, the Collateral Agent or any Secured
Party to enforce the Intellectual Property Collateral and any licenses
thereunder and, upon the request of the Collateral Agent, each Grantor shall use
all commercially reasonable efforts to assist with such filing or enforcement
(including the execution of relevant documents); and
(iii) in the
event that the Collateral Agent elects not to make any filing or bring any suit
as set forth in clause
(ii), each Grantor shall, upon the request of Collateral Agent, use all
commercially reasonable efforts, whether through making appropriate filings or
bringing suit or otherwise, to protect, enforce and prevent the infringement,
misappropriation, dilution, unauthorized use or other violation of the
Intellectual Property Collateral.
Notwithstanding
the foregoing provisions of this Section 6.1, for the
purposes of this Section 6.1,
“Collateral” and “Intellectual Property Collateral” shall include any “intent to
use” trademark application only to the extent (i) that the business of such
Grantor, or portion thereof, to which that xxxx pertains is also included in the
Collateral and (ii) that such business is ongoing and existing.
SECTION
6.2. Compliance with
Restrictions. Each Grantor agrees that in any sale of any of
the Collateral whenever an Event of Default shall have occurred and be
continuing, the Collateral Agent is hereby authorized to comply with any
limitation or restriction in connection with such sale as it may be advised by
counsel is necessary in order to avoid any violation of applicable law
(including compliance with such procedures as may restrict the number of
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prospective
bidders and purchasers, require that such prospective bidders and purchasers
have certain qualifications, and restrict such prospective bidders and
purchasers to Persons who will represent and agree that they are purchasing for
their own account for investment and not with a view to the distribution or
resale of such Collateral), or in order to obtain any required approval of the
sale or of the purchaser by any Governmental Authority or official, and such
Grantor further agrees that such compliance shall not result in such sale being
considered or deemed not to have been made in a commercially reasonable manner,
nor shall the Collateral Agent be liable nor accountable to such Grantor for any
discount allowed by the reason of the fact that such Collateral is sold in
compliance with any such limitation or restriction.
SECTION
6.3. Protection of
Collateral. The Collateral Agent may from time to time, at its
option (a) perform any act which any Grantor fails to perform after being
requested in writing so to perform (it being understood that no such request
need be given after the occurrence and during the continuance of an Event of
Default) and (b) take any other action which the Collateral Agent deems
necessary for the maintenance, preservation or protection of any of the
Collateral or of its security interest therein and, in each case, the expenses
of the Collateral Agent incurred in connection therewith shall be payable by
such Grantor pursuant to Section 11.04 of the Loan Agreement.
ARTICLE
VII
MISCELLANEOUS
PROVISIONS
SECTION
7.1. Loan
Document. This Security Agreement is a Loan Document executed
pursuant to the Loan Agreement and shall (unless otherwise expressly indicated
herein) be construed, administered and applied in accordance with the terms and
provisions thereof, including Article XI thereof.
SECTION
7.2. Binding on Successors,
Transferees and Assigns; Assignment. This Security Agreement
shall remain in full force and effect until the indefeasible payment in full of
the Obligations has occurred, shall be binding upon the Grantors and their
successors, transferees and assigns and shall inure to the benefit of and be
enforceable by each Secured Party and its successors, transferees and assigns;
provided that
no Grantor may (unless otherwise permitted under the terms of the Loan Agreement
or this Security Agreement) assign any of its obligations hereunder without the
prior written consent of all Lenders.
SECTION
7.3. Amendments,
etc. No amendment to or waiver of any provision of this
Security Agreement, nor consent to any departure by any Grantor from its
obligations under this Security Agreement, shall in any event be effective
unless the same shall be in writing and signed by the Collateral Agent (on
behalf of the Lenders or the Required Lenders, as the case may be, pursuant to
Section 11.01 of the Loan Agreement) and the Grantors and then such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which given.
SECTION
7.4. Notices. All
notices and other communications provided for hereunder shall be in writing or
by facsimile and addressed, delivered or transmitted to the appropriate party at
the address or facsimile number of such party specified in the Loan Agreement in
accordance with the notice provisions set forth in the Loan
Agreement.
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SECTION
7.5. Release of Liens and
Termination of Rights. Upon (a) the Disposition of Collateral
in accordance with the Loan Agreement or (b) the Indefeasible Payment and
Performance of All Obligations, the security interests granted herein and the
power of attorney and license granted pursuant to Sections 5.1, 5.2 and 5.3 shall
automatically terminate with respect to (i) such Collateral (in the case of
clause (a)) or
(ii) all Collateral (in the case of clause (b)), without
delivery of any instrument or performance of any act by any
party. Upon any such Disposition or termination, the Collateral Agent
will, at the Grantors’ sole expense, deliver to the Grantors, without any
representations, warranties or recourse of any kind whatsoever, all Collateral
held by the Collateral Agent hereunder, and execute and deliver to the Grantors
such documents as the Grantors shall reasonably request to evidence such
termination. This Section 7.5 is in
addition to and without limitation of Grantors rights as set forth in the final
paragraph of Section 7.01 of the Loan Agreement.
SECTION
7.6. No Waiver;
Remedies. No failure on the part of any Secured Party to
exercise, and no delay in exercising, any right hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any right hereunder
preclude any other or further exercise thereof or the exercise of any other
right. The remedies herein provided are cumulative and not exclusive
of any remedies provided by law.
SECTION
7.7. Headings. The
various headings of this Security Agreement are inserted for convenience only
and shall not affect the meaning or interpretation of this Security Agreement or
any provisions thereof.
SECTION
7.8. Severability. Any
provision of this Security Agreement which is prohibited or unenforceable in any
jurisdiction shall, as to such provision and such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions of this Security Agreement or affecting the validity or
enforceability of such provision in any other jurisdiction.
SECTION
7.9. Governing Law, Entire
Agreement, etc. THIS SECURITY AGREEMENT SHALL BE DEEMED TO BE
A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK
(INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE GENERAL
OBLIGATIONS LAW OF THE STATE OF NEW YORK). This Security Agreement
and the other Loan Documents constitute the entire understanding among the
parties hereto with respect to the subject matter hereof and thereof and
supersede any prior agreements, written or oral, with respect
thereto.
SECTION
7.10. Forum Selection and Consent
to Jurisdiction. ANY LITIGATION BASED HEREON, OR ARISING OUT
OF, UNDER, OR IN CONNECTION WITH, ANY LOAN DOCUMENT, OR ANY COURSE OF CONDUCT,
COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE
COLLATERAL AGENT, THE ADMINISTRATIVE AGENT, THE LENDERS OR ANY GRANTOR IN
CONNECTION HEREWITH OR THEREWITH MAY BE BROUGHT AND MAINTAINED IN THE COURTS OF
THE STATE OF NEW YORK OR IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN
DISTRICT OF NEW YORK; PROVIDED THAT ANY
SUIT SEEKING ENFORCEMENT AGAINST ANY PROPERTY MAY BE BROUGHT,
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AT THE
COLLATERAL AGENT’S OPTION, IN THE COURTS OF ANY JURISDICTION WHERE SUCH PROPERTY
MAY BE FOUND. EACH GRANTOR HEREBY EXPRESSLY AND IRREVOCABLY SUBMITS
TO THE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK, NEW YORK COUNTY AND
OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK
FOR THE PURPOSE OF ANY SUCH LITIGATION AS SET FORTH ABOVE AND IRREVOCABLY AGREES
TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION WITH SUCH
LITIGATION. EACH
GRANTOR IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS BY REGISTERED MAIL,
POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF NEW YORK
AT THE ADDRESS FOR NOTICES SPECIFIED FOR THE BORROWER IN SECTION 10.2 OF THE
LOAN AGREEMENT. EACH GRANTOR HEREBY EXPRESSLY AND IRREVOCABLY WAIVES,
TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY HAVE OR
HEREAFTER MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY
SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN
BROUGHT IN AN INCONVENIENT FORUM. TO THE EXTENT THAT ANY GRANTOR HAS
OR HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY
LEGAL PROCESS (WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT,
ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS
PROPERTY, SUCH GRANTOR HEREBY IRREVOCABLY WAIVES TO THE FULLEST EXTENT PERMITTED
BY LAW SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER THE LOAN
DOCUMENTS.
SECTION
7.11. Counterparts. This
Security Agreement may be executed by the parties hereto in several
counterparts, each of which shall be deemed to be an original and all of which
shall constitute together but one and the same agreement. Delivery of
an executed counterpart of a signature page to this Security Agreement by
facsimile or via other electronic means shall be effective as delivery of a
manually executed counterpart of this Security Agreement.
SECTION
7.12. Reinstatement. This
Security Agreement shall remain in full force and effect and continue to be
effective should any petition be filed by or against any Grantor for liquidation
or reorganization, should any Grantor become insolvent or make an assignment for
the benefit of any creditor or creditors or should a receiver or trustee be
appointed for all or any significant part of any Grantor’s assets, and shall
continue to be effective or be reinstated, as the case may be, if at any time
payment and performance of the Obligations, or any part thereof, is, pursuant to
applicable law, rescinded or reduced in amount, or must otherwise be restored or
returned by any obligee of the Obligations, whether as a “voidable preference,”
“fraudulent conveyance,” or otherwise, all as though such payment or performance
has not been made. In the event that any payment, or any part
thereof, is rescinded, reduced, restored or returned, the Obligations shall be
reinstated and deemed reduced only by such amount paid and not so rescinded,
reduced, restored or returned.
Remainder
of page intentionally left blank.
Signatures
on following page.
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IN
WITNESS WHEREOF, each of the parties hereto has caused this Security Agreement
to be duly executed and delivered by its authorized officer as of the date first
above written.
CHEROKEE
NITROGEN HOLDINGS, INC., an Oklahoma corporation
By: _________________________________
Name:
Title:
NORTHWEST
FINANCIAL CORPORATION, an Oklahoma corporation
By: _________________________________
Name:
Title:
CHEROKEE
NITROGEN COMPANY, an Oklahoma corporation
By: _________________________________
Name:
Title:
DSN
CORPORATION, an Oklahoma corporation
By: _________________________________
Name:
Title:
SIGNATURE
PAGES TO SECURITY AGRE
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EL DORADO
CHEMICAL COMPANY, an Oklahoma corporation
By: _________________________________
Name:
Title:
BANC OF
AMERICA LEASING & CAPITAL LLC, as Collateral Agent
By: _________________________________
Name:
Title:
SIGNATURE
PAGES TO SECURITY AGREEMENT
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SCHEDULE
1.1(a)
to
Security Agreement
Part A – Cherokee
Facility
The major
personal property assets identified at this facility include a concrete dome
xxxxx storage facility with a storage capacity of 14,000 tons; a Xxxxxxx 500 ton per day
(“TPD”) rated capacity ammonia processing plant including six (6) compressors
and sixteen (16) heat exchangers; Chemical Industrial Engineers 300 TPD nitric
acid plant #1 which include two (2) air compressors and two (2) 38 ft high
absorption towers; a X.X. Xxxxxxxxx Company 500 TPD nitric acid plant #2 w/ 60
ft high absorption tower and steam turbine; two (2) Mississippi Chemical
designed 830 TPD ammonium nitrate neutralizers including four (4) storage tanks
and a truck load-out; a 430 TPD high density ammonium nitrate prilling operation
consisting of a xxxxx tower, a xxxxx fattening operation, elevators, conveyors,
sizing equipment, an environmental scrubber, bagging equipment, and climate
control storage; a Technip designed 275 TPD UREA plant with an 83% ammonium
nitrate mixing operation for urea ammonium nitrate (UAN) production and
including a high pressure reactor, four (4) storage tanks, a barge, truck and
rail load-out; other plant infrastructure and support equipment including a
pollution control and irrigation system, cooling towers, a de-alkalizer; barge
unloading equipment, storage tanks, forklift trucks, an auxiliary boiler, a
de-aerator system, product storage tanks, air compressors, electrical power and
distribution equipment including substations, transformers, and motor control
centers, steam water facilities, process plant piping, various pumps, office
furniture and equipment, and general plant equipment.
Part B – El Dorado
Facility
The major
personal property assets identified at this facility include a 285 ton per day
(“TPD”) rated capacity XXXX direct strong nitric acid processing plant; a
Chemical & Industrial Corporation (C&I Xxxxxxx/Chemico) East/West 750
TPD weak nitric acid plant with two (2) parallel trains (375 TPD
each); a X.X. Xxxxxxxxx 350 TPD nitric acid plant; a KT 600 TPD low density
ammonium nitrate xxxxx plant (capacity increased to 860 TPD); a Chemical &
Industrial Corporation (C&I Xxxxxxx/Chemico) 1,100 TPD E2 high density
ammonium nitrate xxxxx plant with neutralizer; a Chemico 360 TPD sulfuric acid
plant; a 100 TPD mixed acid plant; other plant infrastructure and support
equipment includes a CB&I tank farm with ten (10) ammonia storage spheres, a
refrigerated ammonia tank, and six (6) other ammonia nitrate solution storage
tanks; a plant steam production system with two (2) Xxxxxxx & Xxxxxx
processing boilers; a plant electrical power and distribution system including
substations, transformers and motor control centers; maintenance machinery and
equipment; a wastewater pH neutralization system; a pollution control and
irrigation system; cooling towers; forklift trucks; air compressors; process
plant piping, various pumps, office furniture and equipment, and general plant
equipment.
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SCHEDULE
1.1(b)
to
Security Agreement
Cherokee
Site
The tract
or lot of land lying in the County of Colbert, State of Alabama, known and
described as follows, to wit:
PARCEL
I:
Begin at
the Northwest corner of Section 0, Xxxxxxxx 0 Xxxxx, Xxxxx 00 Xxxx, Xxxxxxx
Xxxxxx, Xxxxxxx, and run thence South 0 degrees 36 minutes 44 seconds West
2621.36 feet with the westerly boundary line of said Section 7 to a point on
said boundary line; thence run North 88 degrees 55 minutes 46 seconds West
990.00 feet to a point; thence run South 0 degrees 35 minutes 43 seconds West
2623.55 feet parallel with the westerly boundary line of said Section 7, to a
point on the northerly boundary line of Xxxxxxx 00, Xxxxxxxx 0 Xxxxx, Xxxxx 00
Xxxx; thence run South 0 degrees 46 minutes 39 seconds West a distance of
5329.16 feet to a point on the southerly boundary of Xxxxxxx 00, Xxxxxxxx 0
Xxxxx, Xxxxx 00 Xxxx; thence run South 87 degrees 49 minutes 42 seconds East
1000.47 feet to the Southwest corner of Xxxxxxx 00, Xxxxxxxx 0 Xxxxx, Xxxxx 00
Xxxx; thence run South 89 degrees 14 minutes 26 seconds East 1397.26 feet to the
Southwest corner of the Southeast quarter of the Southeast quarter of said
Section 18, which section is a fractional section; thence run North 0 degrees 21
minutes 39 seconds East a distance of 46.5 feet to a concrete monument on the
north right-of-way margin of Xxxx Academy Road; thence south 89 degrees 08
minutes 27 seconds east along said north right-of-way margin a distance of
1,281.76 feet to a concrete monument; thence south 88 degrees 50 minutes 29
seconds east a distance of 2,191.21 feet; thence south 89 degrees 04 minutes 39
seconds east a distance of 474.74 feet; thence north 12 degrees 06 minutes 31
seconds east a distance of 784.37 feet; thence north 12 degrees 02 minutes 41
seconds east a distance of 51.11 feet; thence south 89 degrees 59 minutes 07
seconds west a distance of 726.65 feet; thence north 00 degrees 00 minutes 42
seconds east a distance of 414.62 feet; thence north 84 degrees 05 minutes 23
seconds east a distance of 780.35 feet; thence north 00 degrees 41 minutes 22
seconds east a distance of 816.26 feet to the south right-of-way margin of a 200
foot railroad right-of-way; thence north 88 degrees 03 minutes 37 seconds west
along said south right-of-way margin a distance of 1,193.19 feet; thence
westerly along the curving south right-of-way margin a distance of 347.85 feet
(said curve concave south, having a radius of 1,046.00 feet, a chord bearing of
south 82 degrees 24 minutes 48 seconds west, a chord length of 346.25 feet);
thence north 02 degrees 12 minutes 51 seconds west a distance of 205.80 feet to
the north right-of-way margin of a 200 foot railroad right-of-way; thence
easterly along the curving north right-of-way margin a distance of 361.43 feet
(said curve concave south, having a radius of 1,246.00 feet, a chord bearing
north 83 degrees 37 minutes 48 seconds east, a chord distance of 360.16 feet);
thence south 88 degrees 03 minutes 37 seconds east a distance of 1,188.82 feet;
thence north 00 degrees 41 minutes 22 seconds east a distance of 310.14 feet;
thence south 89 degrees 24 minutes 33 seconds east a distance of 240.77 feet to
U.S.-T.V.A. Monument No. 50 (being a concrete monument capped by a bronz tablet
showing said monument number and also "T.3S.R.13W.", and all other references to
U.S.-T.V.A. monuments herein shall refer to
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monuments
of like character); thence north 00 degrees 24 minutes 16 seconds east a
distance of 420.42 feet to U.S.-T.V.A. Monument No. 51; thence run north 33
degrees 37 minutes west 2,733.00 feet to U.S.-T.V.A. Monument No. 52 in the
north line of Section 17, which is in the south line of Section 8; thence north
37 degrees 38 minutes west 416.00 feet to U.S.-T.V.A. Monument No. 53 at the
northwest corner of the Southwest Quarter of the Southwest Quarter of the
Southeast Quarter of the Southwest Quarter of Section 8; thence north 01 degree
35 minutes east 977.00 feet to U.S.-T.V.A. Monument No. 54 at the northwest
corner of the Southeast Quarter of the Southwest Quarter of Section 8; thence
north 35 degrees 59 minutes west 1,633.00 feet to U.S.-T.V.A. Monument No. 55 at
the southeast corner of the Southwest Quarter of the Southwest Quarter of the
Southwest Quarter of the Northwest Quarter of Section 8; thence north 88 degrees
50 minutes west 332.00 feet to U.S.-T.V.A. Monument No. 56 at the southwest
corner of the Northwest Quarter of Section 8; thence with the south line of the
Northeast Quarter of Section 7 north 88 degrees 50 minutes west 330.00 feet to
U.S.-T.V.A. Monument No. 57; thence leaving the said south line north 01 degree
23 minutes 15 seconds east 1,966.31 feet to U.S.-T.V.A. Monument No. 58; thence
run north 88 degrees 35 minutes west 336.33 feet to U.S.-T.V.A. Monument No. 59;
thence run south 68 degrees 55 minutes 24 seconds west 1,751.46 feet, more or
less, to a point on the south line of the north half of the north half of
Section 7, Township 3 South, Range 13 West, which point is to be found by
finding the intersection of said south line of said north half of the north half
of said Section 7 with a line run south 00 degrees 39 minutes 12 seconds west a
distance of 45 feet from U.S.-T.V.A. Monument No. 60; thence run north 00
degrees 39 minutes 12 seconds east 659.42 feet; thence run north 56 degrees 58
minutes 57 seconds east 1,150.50 feet, more or less, to U.S.-T.V.A. Monument No.
62 which is located in the north boundary of said Section 7 at a point 1,399.63
feet easterly from the northwest corner thereof; thence run north 88 degrees 39
minutes 30 seconds west with said section line 1,399.63 feet to the POINT OF
BEGINNING.
LESS AND
EXCEPT FROM THE FOLLOWING PARCELS: III, IV, V, VI, AND
VII:
Parcel
III:
Commencing
at the Southwest corner of Section 18, T-3-S, R-13-W, Colbert County, Alabama,
thence North 0 degrees 48 minutes East along the West line of said Section 18 a
distance of 4085.36 feet to a point; thence North 89 degrees 58 minutes East a
distance of 2003.88 feet to a concrete monument and the point of beginning of
the tract herein described; thence North 0 degrees 02 minutes West a distance of
450.00 feet to a point on a chain link fence; thence North 89 degrees 58 minutes
East with chain link fence a distance of 298.00 feet to a point; thence South 0
degrees 02 minutes East with chain link fence a distance of 116.50 feet to a
point; thence North 89 degrees 58 minutes East with chain link fence a distance
of 52.00 feet to a point; thence South 0 degrees 02 minutes East with chain link
fence a distance of 333.50 feet to a point; thence leaving said chain link fence
South 89 degrees 58 minutes West a distance of 2.00 feet to a concrete monument;
thence continuing South 89 degrees 58 minutes West a distance of 348.00 feet to
the concrete monument at the point of beginning of the tract herein
described.
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Parcel IV
Commence
at the Southwest corner of the said Section 0, Xxxxxxxx 0 Xxxxx, Xxxxx 00 Xxxx,
Xxxxxxx Xxxxxx, Xxxxxxx; thence North 0 degrees 36 minutes 44 seconds east along
the west line of the said Section 7 a distance of 2621.68 feet to the northwest
corner of the Southwest 1/4 of the said Section 7 and the point of beginning of
the tract herein described; thence continuing north 0 degrees 36 minutes 44
seconds east a distance of 200.00 feet to a point; thence south 89 degrees 23
minutes 16 seconds east a distance of 1500.00 feet to a point; thence south 0
degrees 36 minutes 44 seconds west a distance of 600.0 feet to a point; thence
north 89 degrees 23 minutes 16 seconds west a distance of 1500.0 feet to a point
on the west line of said Section 7; thence north 0 degrees 36 minutes 44 seconds
east a distance of 400.0 feet to the point of beginning of the tract herein
described.
Parcel
V
A parcel
of land located in Section 00, Xxxxxxxx 0-Xxxxx, Xxxxx 13-West in Colbert
County, State of Alabama, said parcel lying east of a right of way for a
proposed road approximately 3 miles north of Cherokee, and being more
particularly described as follows: Commencing at a point in the east
line of Section 18, said point being 1276.0 feet south of the northeast corner
of said section; thence xxx xxxx, 620.9 feet to the POINT OF BEGINNING at the
northeast corner of the parcel of land herein described; thence due south 600.0
feet to a point; thence xxx xxxx, 500.0 feet to a point; thence with a line
132.0 feet east of and parallel to the east line of the right of way of a
proposed road due north, 600.0 feet to a point; thence due east, 500.0 feet to
the point of beginning.
Parcel
VI
Also for
the point of beginning, commence at the intersection of the South line of North
half of North half of Section 0, Xxxxxxxx 0 Xxxxx, Xxxxx 00 Xxxx, Xxxxxxx
Xxxxxx, Xxxxxxx, with a line run South 0 degrees 39 minutes 12 seconds West from
U.S.-T.V.A. Monument No. 60; thence run North 0 degrees 39 minutes 12 seconds
East 659.42 feet to the point of beginning; from said point of beginning run
thence North 56 degrees 58 minutes 57 seconds E 1150.50 feet, more or less, to
U.S.-T.V.A. Monument No. 62, which is located in the North boundary of Section 7
at a point of 1399.63 feet easterly from the Northwest corner thereof; from said
Monument No. 62 run thence South 58 degrees 53 minutes 18 seconds West 1126.17
feet to U.S.-T.V.A. Monument No. 61; thence run South 0 degrees 39 minutes 12
seconds West to the point of beginning.
Parcel
VII:
Commence
at the southwest corner of Section 00, Xxxxxxxx 0 Xxxxx, Xxxxx 00 Xxxx, Xxxxxxx
Xxxxxx, Xxxxxxx; thence south 89 degrees 14 minutes 26 seconds east along the
South boundary of said Section 18 a distance of 1,397.26 feet; thence run North
00 degrees 21 minutes 39 seconds East a distance of 825.71 feet to the POINT OF
BEGINNING; continue thence North 00 degrees 21 minutes 39 seconds East a
distance of 505.52 feet; thence South 89 degrees 22 minutes 51 seconds East
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a
distance of 1,116.70 feet; thence South 66 degrees 13 minutes 10 seconds West
along said southeasterly right of way margin a distance of 1,223.71 feet to the
POINT OF BEGINNING, containing 6.48 acres, more or less, and then being that
same parcel of land described in Deed Book 264, Page 560 as recorded in the
Probate Office of Colbert County, Alabama.
PARCEL
II:
A tract
of land lying in Colbert County, State of Alabama, in the East half of East half
of Northeast quarter, Section 7, the West half of Northwest quarter and
Southwest quarter of Section 8, and the Northeast quarter and East half of
Northwest quarter of Section 17, Township 3 South, Range 13 West on the
southwest shore of Pickwick Landing Lake opposite Kogor's Island and
approximately 4 miles northeast of Cherokee, Alabama, and being more
particularly described as follows:
Beginning
at U.S.-T.V.A. Monument 51 in the Southwest quarter of Southwest quarter of
Northeast quarter of Section 17 and in the boundary of true United States of
America's land at a corner of the land of Xxx. X.X. Xxxxxx and X.X. Xxxxxxxx
& X.X. Xxxxx' thence with the United States of America's boundary North 33
degrees 37' West 2733.00 feet to the U.S.-T.V.A. Monument 52 in the north line
of Section 17, which is the south line of Section 8; thence North 37 degrees 38'
West, 416.00 feet to U.S.-T.V.A. Monument 53 at the northwest corner of the
Southwest quarter of the Southwest quarter of the Southeast quarter of Southwest
quarter, Section 8; thence North 1 degree 35' East, 977.00 feet to U.S.-T.V.A.
Monument 54 at the northwest corner of the Southeast quarter of the SW 1/4
Section 8, thence North 35 degrees 59' West, 1633.00 feet to U.S.-T.V.A.
Monument 55 at the southeast corner of the Southwest quarter of the Southwest
quarter of Southwest quarter of Northwest quarter, Section 8; thence North 88
degrees 50' West, 332.00 feet to U.S.-T.V.A. Monument 56 at the southwest corner
of the Northwest quarter of Section 8; thence with the south line of the
Northeast quarter, Section 7 North 88 degrees 50' West, 330.00 feet to
U.S.-T.V.A. Monument 57; thence leaving the said South line, North 1 degree 23
minutes 15 seconds East, 1966.31 feet to U.S.-T.V.A. Monument 58; thence,
leaving the United States of America's boundary South 89 degrees 59 minutes 29
seconds East, 410 feet, passing a metal marker at 385.00 feet, to a point in the
423-foot contour on the shore of Pickwick Landing Lake; thence with the 423-foot
contour as it meanders in a southeasterly direction to a point; thence, leaving
the contour, South 61 degrees 19 minutes 05 seconds West, 534.50 feet, passing a
metal marker at 17 feet, to U.S.-T.V.A. Monument 49 in the south line of the
Northeast quarter of Section 17 and in the boundary of the United States of
America's land; thence with the United States of America's boundary and the
south line of the Northeast quarter of Section 17, North 89 degrees 19 minutes
West, 260.20 feet to U.S.-T.V.A. Monument 50; thence leaving the said south
line, North 0 degrees 24 minutes 16 seconds East, 420.42 feet to the point of
beginning.
PARCEL
III:
Commencing
at the Southwest corner of Section 18, T-3-S, R-13-W, Colbert County, Alabama,
thence North 0 degrees 48 minutes East along the West line of said Section 18 a
distance of 4085.36 feet to a point; thence North 89
degrees 58 minutes East a distance of 2003.88 feet to a concrete monument and
the point of beginning of the tract herein described; thence North 0 degrees 02
minutes West a distance of 450.00 feet to a point on a chain link fence; thence
North
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89
degrees 58 minutes East with chain link fence a distance of 298.00 feet to a
point; thence South 0 degrees 02 minutes East with chain link fence a distance
of 116.50 feet to a point; thence North 89 degrees 58 minutes East with chain
link fence a distance of 52.00 feet to a point; thence South 0 degrees 02
minutes East with chain link fence a distance of 333.50 feet to a point; thence
leaving said chain link fence South 89 degrees 58 minutes West a distance of 2.0
feet to a concrete monument; thence continuing South 89 degrees 58 minutes West
a distance of 348.00 feet to the concrete monument at the point of beginning at
the tract herein described.
PARCEL
VIII:
A parcel
of land lying in Section 00, Xxxxxxxx 0 Xxxxx, Xxxxx 13 West, Colbert County,
Alabama, and being more particularly described as follows: Commence
at the southwest corner of Section 00, Xxxxxxxx 0 xxxxx, Xxxxx 00 Xxxx, Xxxxxxx
Xxxxxx, Xxxxxxx; thence north 00 degrees 44 minutes 27 seconds west a distance
of 44.05 feet to a concrete monument on the north right-of-way of Xxxx Academy
Road; thence south 88 degrees 50 minutes 29 seconds east along the north
right-of-way of an unnamed County road a distance of 2,191.21 feet; thence south
89 degrees 04 minutes 39 seconds east a distance of 535.94 feet to the east
right-of-way of a County road and the POINT OF BEGINNING; thence north 12
degrees 05 minutes 42 seconds east a distance of 761.78 feet; thence south 70
degrees 57 minutes 14 seconds east a distance of 233.95 feet to a Point of
Curve; thence southeasterly along a curve concave north a distance of 638.62
feet (said curve having a radius of 2,025.00 feet, a chord bearing of south 79
degrees 59 minutes 24 seconds east, a chord distance of 635.97 feet) to the
Point of Tangency; thence south 89 degrees 01 minute 08 seconds east a distance
of 517.34 feet to a Point of Curve; thence southeasterly along said curve
concave southwesterly a distance of 566.33 feet (said curve having a radius of
950.00 feet, a chord bearing of south 71 degrees 56 minutes 27 seconds east, a
chord distance of 557.98 feet) to a Point of Reverse Curve; thence southwesterly
along a curve a distance of 108.67 feet (said curve concave northeasterly having
a chord bearing of south 25 degrees 43 minutes 19 seconds east, a chord distance
of 88.51 feet) to a point; thence south 00 degrees 41 minutes 33' west a
distance of 360.35 feet; thence north 89 degrees 04 minutes 24 seconds west a
distance of 1,995.46 feet; thence north 00 degrees 46 minutes 28 seconds east a
distance of 30.00 feet; thence north 88 degrees 59 minutes 48 seconds west a
distance of 94.09 feet to the POINT OF BEGINNING.
PARCEL
IX:
A parcel
of land lying in Section 17, Township 3 South, Range 13 West and being more
particularly described as follows: Commence at the southwest corner
of Section 00, Xxxxxxxx 0 xxxxx, Xxxxx 00 Xxxx, Xxxxxxx Xxxxxx, Xxxxxxx; thence
north 00 degrees 44 minutes 27 seconds west a distance of 44.05 feet to a
concrete monument on the north right-of-way of Xxxx Academy Road; thence south
88 degrees 50 minutes 29 seconds east along the north right-of-way of an unnamed
County road a distance of 2,191.21 feet; thence south 89 degrees 04 minutes 39
seconds east a distance of 535.94 feet to the east right-of-way of a County
Road; thence north 12 degrees 05 minutes 42 seconds east along said east
right-of-way a distance of 812.15 feet to the POINT OF BEGINNING; thence north
12 degrees 05 minutes 22 seconds east along said right-of-way a distance of
204.63 feet; thence north 01 degree 53 minutes 39 seconds east along said
right-of-way a distance of 310.69 feet; thence south 89 degrees 07 minutes 03
seconds east a distance of 1,802.58 feet to T.V.A. Monument #48; thence south 42
degrees 56 minutes 26 seconds east a distance of 310.99 feet; thence south 56
degrees 00 minutes 16 seconds west a distance of 808.14 feet to a point of
curve; thence northwesterly along a curve concave
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southwesterly
a distance of 43.45 feet (said curve having a radius of 1,000.00 feet, a chord
bearing of N 87 deg 46 min 18 sec West a arc length of 43.45 feet) to the point
of tangency; thence north 89 degrees 01 minutes 16 seconds West a distance
516.26 feet to the Point of a Curve; thence northwesterly along a curve concave
north a distance of 622.86 feet (said curve having a radius of 1,975 feet, a
chord bearing of North 79 degrees 59 minutes 24 seconds West, a chord distance
of 620.28 feet) to the Point of Tangency; thence North 70 degrees 57 minutes 14
seconds West a distance of 240.04 feet to the POINT OF BEGINNING.
All the
foregoing being the same property conveyed by XxXxxxx Industries, Inc. to
Cherokee Nitrogen Company, by deed dated October 31, 2000, filed for record in
the Office of the Judge of Probate of Colbert County, Alabama, on November 7,
2000, at 1:37 p.m., and recorded on Microfiche 2000 25, Frames
133-141.
Less and
except therefrom property conveyed by Cherokee Nitrogen, Inc., to National
Telephone Company of Alabama, by corrective warranty deed dated April 2, 2001
and recorded on Fiche 2001 09 Frame 748, being more particularly described as
follows, to-wit:
Commence
at a cotton spindle on the SW corner of Section 00, X-0-X, X-00-X, Xxxxxxx
Xxxxxx, Xxxxxxx; then run S 89 degrees 14’ 26” E for 1397.26’ to a spike found;
then run N 0 degrees 21’ 39” E for 46.4’ to a 6” concrete monument, the point of
beginning; then run N 0 degrees 21’ 39” E for 50.0’ to an iron pin; then run S
89 degrees 14’ 26” E for 50.0’ to an iron pin; then run S 0 degrees 21’ 39” W
for 50.0’ to an iron pin; then run N 89 degrees 14’ 26” W for 50.0’ to the point
of beginning.
NON-EXCLUSIVE
EASEMENT FOR PRIVATE ROAD
A fifty
(50) foot wide private road lying in Section 00, Xxxxxxxx 0 Xxxxx, Xxxxx 13
West, Colbert County, Alabama, and being more particularly described as follows:
Commence at the southwest corner of Section 00, Xxxxxxxx 0 Xxxxx, Xxxxx 00
Xxxx, Xxxxxxx Xxxxxx, Xxxxxxx, thence North 00 degrees 44 minutes 27 seconds
West a distance of 44.05 feet to a concrete monument on the northern
right-of-way margin of Xxxx Academy road; thence South 88 degrees 50 minutes 29
seconds East along the northern right-of-way margin of a gravel road a distance
of 2,191.21 feet; thence South 89 degrees 04 minutes 39 seconds East a distance
of 535.74 feet to the east right-of-way margin of a County Road; thence North 12
degrees 05 minutes 42 seconds East a distance of 761.78 feet to the POINT OF
BEGINNING; thence continue North 12 degrees 05 minutes 42 seconds East a
distance of 50.37 feet; thence South 70 degrees 57 minutes 14 seconds East a
distance of 240.04 feet to the P.C. of a curve; thence southeasterly a curve
concave northerly a distance of 622.86 feet (said curve having a radius of
1,975.00 feet, a chord distance of 620.28 feet, a chord bearing of South 79
degrees 59 minutes 24 seconds East) to the P.T. of said curve; thence South 89
degrees 01 minute 16 seconds East a distance of 516.26 feet to the P.C. of a
curve; thence southeasterly along a curve concave southwesterly a distance of
648.77 feet (said curve having a radius of 1,000.00 feet, a chord distance of
637.45 feet, a chord bearing of South 70 degrees 26 minutes 42 seconds East) to
the P.T. of said curve and the P.C. of a cul-de-sac; thence easterly, southerly,
northwesterly along a curve (having a radius of 50.00 feet; a chord bearing of
South 82 degrees 09 minutes 16 seconds West, a chord distance of 70.63 feet) a
distance of 234.31 feet to the P.T. of said curve; thence northwesterly along a
curve
- 29
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concave
southwest a distance of 566.33 feet (said curve having a radius of 950.00 feet,
a chord bearing of North 71 degrees 56 minutes 27 seconds West, a chord distance
of 557.98 feet) to the P.T. of said curve; thence North 89 degrees 01 minute 08
seconds West a distance of 517.34 feet to the P.C. of a curve; thence
northwesterly along a curve concave northerly of 638.62 feet (said curve having
a radius of 2,025.00 feet, a chord distance of 635.97 feet, a chord bearing of
79 degrees 59 minute 24 seconds west) to the P.T. of said curve, thence North 70
degrees 57 minutes 14 seconds West) to the P.T. of said curve; thence North 70
degrees 57 minutes 14 seconds West a distance of 233.95 feet to the POINT OF
BEGINNING.
- 30
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SCHEDULE
1.1(c)
to
Security Agreement
El Dorado
Site
The land
referred to herein below is all situated in Union County, Arkansas
Tract
1:
The South
Half of Section 6, and the North Half of Section 7, and the Northwest
Quarter of the Northwest Quarter of Section 8, all in Township 17
South, Range 15 West, and the following described tract:
Beginning
at the Northwest Corner of the Northeast Quarter of the Northwest Quarter of
Section 8, Township 17 South, Range 15 West;
thence
South along the West line of said Northeast Quarter of the Northwest Quarter of
Section 8 to the intersection with the South right-of-way line of the
access road as now located, said right-of-way line being 50 feet
perpendicular distance from the center line of said access
road;
thence in
a Northeasterly direction along said right-of-way line to the
intersection with the South line of the right-of-way of the railroad spur,
said right-of-way line for the railroad spur being 50 feet perpendicular
distance from the center line of said railroad spur;
thence
along said South right-of-way line for the railroad spur to a point which is
750 feet South of the North line of said Section 8;
thence
East along a line which is parallel to the North line of said Section 8,
and 750 feet distant therefrom to the intersection with the
South right-of-way line for the railroad spur herein above
described;
thence in
a Southeasterly direction along the said South right-of-way line to the
intersection with the West right-of-way line of the
El Dorado-Smackover Highway;
thence in
a Northwesterly direction along the West right-of-way line of said
El Dorado-Smackover Highway to the North line of Section 0,
Xxxxxxxx 00 Xxxxx, Xxxxx 00Xxxx;
thence
West along the North line of said Section 9 and the North line of said
Section 8 to the POINT OF BEGINNING.
LESS
AND EXCEPT THE FOLLOWING TRACTS:
1. Commencing
at the Southeast Xxxxxx xx Xxxxxxx 0, Xxxxxxxx 00 Xxxxx, Xxxxx 15
West, and
thence
run North 88 degrees 53 minutes 44 seconds West
1772.43 feet;
thence
North 01 degree 03 minutes 47 seconds East 576.89 feet for a
POINT OF BEGINNING;
thence
North 88 degrees 56 minutes 13 seconds West
134.0 feet;
thence
North 01 degree 03 minutes 47 seconds East
40.00 feet;
thence
North 88 degrees 56 minutes 13 seconds West
16.00 feet;
thence
North 01 degree 03 minutes 47 seconds East
40.0 feet;
thence
South 88 degrees 56 minutes 13 seconds East
150.00 feet;
- 31
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thence
South 01 degree 03 minutes 47 seconds West 80.00 feet to the
POINT OF BEGINNING.
AND
2. Commencing
at the Southeast Xxxxxx xx Xxxxxxx 0, Xxxxxxxx 00 Xxxxx, Xxxxx 15
West, run
thence
North 88 degrees 53 minutes 44 seconds West 2341.68 feet;
thence
North 01 degree 05 minutes 46 seconds East 545.52 feet for a
POINT OF BEGINNING;
thence
North 88 degrees 54 minutes 14 seconds West
240.00 feet;
thence
North 01 degree 05 minutes 46 seconds East
30.00 feet;
thence
North 88 degrees 54 minutes 14 seconds West
96.71 feet;
thence
North 01 degree 05 minutes 46 seconds East
118.10 feet;
thence
South 88 degrees 54 minutes 14 seconds East
336.71 feet;
thence
South 01 degree 05 minutes 46 seconds West
85.72 feet;
thence
South 88 degrees 54 minutes 14 seconds East
59.31 feet;
thence
South 01 degree 05 minutes 46 seconds West
40.58 feet;
thence
North 88 degrees 54 minutes 14 seconds West
59.31 feet;
thence
South 01 degree 05 minutes 46 seconds West 21.80 feet to the
POINT OF BEGINNING.
Tract
2:
Commencing
at the North Quarter Corner of Section 1, Township 17 South,
Range 16 West,
thence
South 88 degrees 46 minutes East, 282.7 feet;
thence
South 01 degree 14 minutes West, 269.2 feet to the POINT OF
BEGINNING;
thence
South 88 degrees 46 minutes East, 150.0 feet;
thence
South 01 degree 14 minutes West, 150.0 feet;
thence
North 88 degrees 46 minutes West, 150.0 feet;
thence
North 01 degree 14 minutes East, 150.0 feet to the POINT OF
BEGINNING.
Tract
3:
Beginning
at the Southwest Corner of the Northeast Quarter of Section 31,
Township 16South, Range 15 West;
thence
North 00 degrees 07 minutes East 150 feet to a
stake;
thence
South 88 degrees 37 minutes East 150 feet to a
stake;
thence
South 00 degrees 07 minutes West 150 feet to a stake on South
line of the Northeast Quarter;
thence
North 88 degrees 37 minutes West 150 feet to POINT OF
BEGINNING.
Tract
4:
Beginning
at the Southeast Corner of the Southwest Quarter of Section 30,
Township 16 South, Range 15 West, at a iron pipe
Corner;
thence
North 88 degrees 38 minutes West 150 feet along the South line of
said Section 30 to a stake;
thenceNorth
00 degrees 07 minutes East 150 feet to a stake;
thence South
88 degrees 38 minutes East to a stake on the East line of said Southwest
Quarter;
thence
South 00 degrees 07 minutes Xxxx 000 xxxx xx XXXXX XX
XXXXXXXXX.
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Xxxxx
0:
Commencing
at the Northwest Corner of the South Half of the Northeast Quarter of
Section 12, Township 17 South, Range 16 West;
thence
South 00 degrees 04 minutes East, 469.0 feet;
thenceNorth 53
degrees 09 minutes East, 126.45 feet;
thenceNorth 61
degrees 26 minutes East, 239.7 feet to the POINT OF
BEGINNING;
thenceNorth 00
degrees 04 minutes West, 118.7 feet;
thenceNorth 89
degrees 56 minutes East, 150.0 feet;
thenceSouth 00
degrees 04 minutes East, 150.0 feet;
thenceSouth 89
degrees 56 minutes West, 150.0 feet;
thenceNorth 00
degrees 04 minutes West, 31.3 feet to the POINT OF BEGINNING.
Tract
6:
Beginning
at a point which is South 00 degrees 18 minutes East 223.2 feet
and North 89 degrees 42 minutes East 273.1 feet distance from the
Northwest Corner of the Southwest Quarter of Section 9, Township 17
South, Range 15 West;
thence
North 00 degrees 18 minutes West 150 feet;
thence
North 89 degrees 42 minutes East 150 feet;
thence
South 00 degrees 18 minutes East 150 feet;
thence
South 89 degrees 42 minutes West 150 feet to the POINT OF
BEGINNING.
Tract
7:
Beginning
at the Southwest Corner of the Southeast Quarter of Xxxxxxx 0,
Xxxxxxxx 00 Xxxxx, Xxxxx 00 Xxxx;
thence
North 150 feet along the West line of said Southeast Quarter to a
stake;
thence
South 88 degrees 56 minutes East 150 feet to a
stake;
thence
South 150 feet to a stake on South line of said
Section 2;
thence
North 88 degrees 56 minutes West 150 feet to POINT OF
BEGINNING.
Tract
8:
Beginning
at the Xxxxxxxxx Xxxxxx, Xxxxxxx 0, Xxxxxxxx 00 Xxxxx, Xxxxx 16
West;
thence
North along Section line 150 feet to a stake;
thence
South 88 degrees 56 minutes East 150 feet to a
stake;
thence
South 150 feet to a stake;
thence
North 88 degrees 56 minutes West 150 feet to POINT OF
BEGINNING.
Tract
9:
Commencing
at the Southwest Corner of the Southeast Quarter of Section 12,
Township 17 South, Range 16 West;
thence
North 00 degrees 04 minutes West, 276.7 feet;
thence
North 89 degrees 56 minutes East, 271.8 feet to the POINT OF
BEGINNING;
thence
North 00 degrees 04 minutes West, 150 feet;
thence
North 89 degrees 56 minutes East, 150 feet;
thence
South 00 degrees 04 minutes East, 150 feet;
thence
South 89 degrees 56 minutes West, 150 feet to the POINT OF
BEGINNING.
- 33
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Tract
10:
Commencing
at the Southwest Corner of Southeast Quarter of Xxxxxxx 0, Xxxxxxxx 00
Xxxxx, Xxxxx 00 Xxxx;
thence
South 88 degrees 25 minutes East 155.4 feet;
thence
North 01 degree 35 minutes East 308.5 feet to the POINT OF
BEGINNING;
thence
continuing North 01 degree 35 minutes East 150 feet;
thence
South 88 degrees 25 minutes East 150 feet;
thence
South 01 degree 35 minutes West 150 feet;
thence
North 88 degrees 25 minutes West 150 feet to the POINT OF
BEGINNING.
Tract
11:
Beginning
at the Northwest Corner of the Southeast Quarter, Section 18,
Township 17 South, Range 15 West;
thence
South 88 degrees 21 minutes East 150 feet along the North line of
the said Southeast Quarter to a stake;
thence
South 00 degrees 11 minutes East 150 feet to a
stake;
thence
North 88 degrees 21 minutes West 150 feet to a stake on the West
line of the said Southeast Quarter;
thence
North 00 degrees 11 minutes West 150 feet to the POINT OF
BEGINNING.
Tract
12:
Beginning
at a point on the West line of the Southeast Quarter of Section 18,
Township 17 South, Range 15 West, located North 00 degrees
11 minutes West 150 feet from the Southwest Corner of said Southeast
Quarter;
thence
North 00 degrees 11 minutes West 100 feet along the West line of
said Southeast Quarter to a stake;
thence
South 88 degrees 17 minutes East 150 feet to a
stake;
thence
South 00 degrees 11 minutes East 100 feet to a
stake;
thence
North 88 degrees 17 minutes West 150 feet to the POINT OF
BEGINNING.
Tract
15:
Beginning
at the Southeast Corner of Section 1, Township 17 South, Range 16
West;
thence
North 89 degrees 25 minutes West along the South line of said
Section 1, 4830.14 feet to POINT OF BEGINNING;
thence
North 00 degrees 04 minutes East 150 feet;
thence
North 89 degrees 25 minutes West 150 feet;
thence
South 00 degrees 04 minutes West 150 feet to the
intersection of South line of Section 1;
thence
South 89 degrees 25 minutes East along Section line 150 feet
to POINT OF BEGINNING.
- 34
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Tract
16:
Beginning
at a point 10.4 feet North of the Xxxxxxxxx Xxxxxx xx Xxxxxxx 0,
Xxxxxxxx 00Xxxxx, Xxxxx 15 West;
thence
East 29.5 feet;
thence
North 150.0 feet;
thence
West 29.5 feet;
thence
South 150.0 feet to the POINT OF BEGINNING.
Tract
17:
Beginning
at a point 70 yards North of the Southeast Corner of Section 1,
Township 17 South, Range 16 West;
thence
West 25.00 feet;
thence
South approximately 134.83 feet;
thence
East 25.00 feet;
thence
North to the PLACE OF BEGINNING.
The
exclusive right to produce water from any horizon lying under the following
described Tract 18 in Union County, Arkansas, at and below a depth of
350 feet below the surface:
Tract
18:
The East
Half of Section 1 and the East Half of Section 12, all in
Township 17 South, Range 16 West,
ARTICLE
VIII AND
The South
Half of Section 7 and all of Section 8, all in Township 17 South,
Range 15 West,
ARTICLE
IX AND
All that
part of the West Half of the West Half of Section 9, Township 17
South, Range 15 West, lying West of the El Dorado-Smackover Highway
and all that part of the Southwest Quarter of the Southwest Quarter of
Section 4, Township 17 South, Range 15 West, lying West of the
El Dorado-Smackover Highway and all of Section 5 and the North Half of
Section 6, all in Township 17 South, Range 15 West, EXCEPT the following described
tracts, lettered (a) through (k), both inclusive, to-wit:
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(a)
The Northwest Quarter of the Northwest Quarter of Xxxxxxx 0,
Xxxxxxxx 00 Xxxxx, Xxxxx 00
Xxxx.
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(x)
Beginning at the Northwest Corner of the Northeast Quarter of the
Northwest Quarter of Section 8, Township 17 South, Range 15
West;
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thence
South along the West line of said Northeast Quarter of the Northwest
Quarter of said Section 8 to the intersection with the South
right-of-way line of the Access Road as now located, said right-of-way
line being 50 feet perpendicular distance from the center line of
said Access Road;
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- 35
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thence
in a Northeasterly direction along said right-of-way line to the
intersection with the South line of the right-of-way of the railroad
spur, said right-of-way line for the railroad spur being 50 feet
perpendicular distance from the center line of said railroad
spur;
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thence
along said South right-of-way line for the railroad spur to a point which
is 750 feet South of the North line of said
Section 8;
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thence
East along a line which is parallel to the North line of said
Section 8, and 750 feet distant therefrom, to the
intersection with the South right-of-way line for the railroad spur
hereinabove described;
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thence
in a Southeasterly direction along the said South right-of-way line to the
intersection with the West right-of-way line of the
El Dorado-Smackover Highway;
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thence
in a Northwesterly direction along the West right-of-way line of said
El Dorado-Smackover Highway to the North line of Xxxxxxx 0,
Xxxxxxxx 00 Xxxxx, Xxxxx 00
Xxxx;
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thence
West along the North line of said Section 9 and the North line of
said Section 8 to the POINT OF
BEGINNING.
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(c) Commencing
at the Northwest Corner of Section 5, Township 17 South,
Range 15 West;
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thence
South 88 degrees 24 minutes East 4060.30 feet to the POINT
OF BEGINNING of this excepted
tract;
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thence
South 00 degrees 40 minutes West
1213.20 feet;
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thence
South 88 degrees 10 minutes East 1200.33 feet to the
El Dorado-Smackover Highway;
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thence
in a Northwesterly direction along said Highway to the North line of said
Section 5;
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thence
in a Westerly direction to the POINT OF
BEGINNING.
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(d) Commencing
at the Northeast Corner of Section 6, Township 17 South,
Range 15 West;
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thence
North 88 degrees 23 minutes West 1327 feet to the POINT OF
BEGINNING of this excepted tract;
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thence
South 01 degree 37 minutes West
90 feet;
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thence
North 88 degrees 23 minutes West
990 feet;
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thence
North 01 degree 37 minutes East
90 feet;
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thence
South 88 degrees 23 minutes East 990 feet to the POINT OF
BEGINNING.
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(e) Tract
2 described above.
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(f) Tract
5 described above.
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(g) Tract
6 described above.
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(h) Tract
9 described above.
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(i) Tract
10 described above.
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(j) Tract
16 described above.
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(k) Tract
17 described above.
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TOGETHER WITH all of the
rights of the United States of America as granted to Lion Oil Company in an
instrument entitled “Quitclaim Deed, Assignment and Xxxx of Sale” which was
filed March 5, 1948 in Record Book 511, Page 405 to maintain,
repair, replace and operate each electrical transmission line, telephone line,
water line gas line, sanitary sewer, drainage sewer, drainage ditch, road, trail
or railroad upon any of the land which constitutes a part of Tract 18 described
above or which leads from Tract 18 described above to Xxxxxx 0, 0, 0, 0, 00, 00
xxx 00
- 00
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described
above, and the right-of-way in connection therewith, all as is more fully set
forth in said Quitclaim Deed, Assignment and Xxxx of Sale.
TOGETHER WITH such water
rights as were reserved by Monsanto Company in a Quitclaim Deed in favor of
X. X. Xxx which was filed February 23, 1981 in Record Book 1459,
Page 601, of the Union County Deed Records describing the following
tract:
Beginning
at the Southwest Corner of the Southwest Quarter of the Southeast Quarter of
Section 8, Township 17 South, Range 15 West;
thence
North 417.4 feet;
thence
East 417.4 feet;
thence
South 417.4 feet;
thence
West 417.4 feet to the POINT OF BEGINNING.
ALSO
Commencing
at the Southeast Corner of the Southeast Quarter of the Southwest Quarter of
Section 8, Township 17 South, Range 15 West;
thence
North 01 degree 06 minutes East 274.0 feet to the POINT OF
BEGINNING;
thence
North 88 degrees 54 minutes West 69.8 feet;
thence
North 01 degree 06 minutes East 150.0 feet;
thence
South 88 degrees 54 minutes East 69.8 feet;
thence
South 01 degree 06 minutes West 150.0 feet to the POINT OF
BEGINNING.
TOGETHER WITH such water
rights as were reserved in a Quitclaim Deed in favor of Xxxxx Xxxx White et al
which was filed September 10, 1982 in Record Book 1521, Page 257, in
the Union County Deed Records describing the following tract:
Beginning
at the Southwest Corner of the Southwest Quarter of the Northwest Quarter of
Section 9, Township 17 South, Range 15 West;
and run
North 00 degrees 38 minutes East 1729.4 feet to the South
right-of-way line of the Missouri-Pacific Railroad;
thence in
a Southeasterly direction along said right-of-way for 547.8 feet to the
Xxxx xxxx xx Xxxxxxx Xx. 0X;
thence
South 08 degrees 29 minutes East along said line
21.8 feet;
thence
South 05 degrees 24 minutes East along said line
1444.0 feet;
thence
South 02 degrees 50 minutes East along said line
96.57 feet;
thence
North 88 degrees 14 minutes West 675.4 feet to the POINT OF
BEGINNING.
Tract
41-1 (25):
The West
Half of the Southeast Quarter of the Southeast Quarter and the Northeast Quarter
of the Southeast Quarter of Section 7, and the Southwest Quarter of the
Northwest Quarter of Section 8, all in Township 17 South,
Range 15 West, Union County, Arkansas, EXCEPTING THE FOLLOWING DESCRIBED
TRACT:
Beginning
at a point 600.0 feet North of the Northwest Corner of the Southwest
Quarter of said Section 8;
thence
North 435.6 feet;
- 37
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thence
East 100.0 feet;
thence
South 435.6 feet;
thence
West 100.0 feet to the POINT OF BEGINNING.
Tract
41-2 (20):
The North
Three-Quarters of the North Half of the Northwest Quarter of the Southeast
Quarter (N 3/4 N/2 NW/4 SE/4) of Section 7, Township 17 South,
Range 15 West, LESS
three (3) acres in the form of a square in the Northeast Corner
thereof.
Tract
41-4 (22):
Three
acres in the form of a square out of the Northeast Corner of the Northwest
Quarter of the Southeast Quarter of Section 7, Township 17 South,
Range 15 West of the Fifth Principal Meridian.
(Same
Property as the exception in 41-2 (20) above)
Tract
41-4 (23):
Beginning
at a point 600 feet North of the Southwest Corner of the Southwest Quarter
of the Northwest Quarter of Section 8, Township 17 South,
Range 15 West of the Fifth Principal Meridian;
thence
East 100.0 feet;
thence
North 435.6 feet;
thence
West 100.0 feet;
thence
South 435.6 feet to the PLACE OF BEGINNING.
(Same
Property as the exception in 41-1 (25) above)
Tract
41-4 (24):
A part of
the Southwest Quarter of the Southeast Quarter of Section 8,
Township 17 South, Range 15 West of the Fifth Principal Meridian,
described as follows:
Beginning
at a point 417.4 feet North of the Southwest Corner of the said Southwest
Quarter of the Southeast Quarter of Section 8 and running thence North
208.71 feet;
thence
East 208.71 feet;
thence
South 208.71 feet;
thence
West 208.71 feet to the PLACE OF BEGINNING,
EXCEPT that part of the
Southwest Quarter of the Southeast Quarter of Section 8 contained within
the following parcel of land, described as:
Commencing
at the Southwest Corner of said Southwest Quarter of the Southeast Quarter of
said Section 8;
thence
South 88 degrees 54 minutes East, 80.2 feet;
thence
North 01 degree 06 minutes East, 274.0 feet to the POINT OF
BEGINNING of said parcel;
thence
North 88 degrees 54 minutes West, 150.0 feet;
thence
North 01 degree 06 minutes East, 150.0 feet;
thence
South 88 degrees 54 minutes East, 150.0 feet;
thence
South 01 degree 06 minutes West, 150.0 feet to the POINT OF
BEGINNING.
Tract
41-5 (19):
- 38
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The South
Five-Eighths of the Northwest Quarter of the Southeast Quarter and the North
Three-Eighths of the Southwest Quarter of the Southeast Quarter of
Section 7, Township 17 South, Range 15 West of the Fifth
Principal Meridian.
Tract
41-7:
The
Southwest Quarter of the Northeast Quarter and the Southeast Quarter of the
Northwest Quarter of Section 0, Xxxxxxxx 00 Xxxxx, Xxxxx 00 Xxxx,
Xxxxx Xxxxxx, Xxxxxxxx.
Tract
41-9:
The
Northwest Quarter of the Southwest Quarter of Section 5, Township 17
South, Range 15 West,
AND
The East
Half of the Northeast Quarter of Section 6, Township 17 South,
Range 15 West.
Tract
41-10:
The
Northwest Quarter of the Northeast Quarter of Section 0, Xxxxxxxx 00
Xxxxx, Xxxxx 00 Xxxx, Xxxxx Xxxxxx, Xxxxxxxx, LESS AND EXCEPT the following
tract:
Commencing
at the Northeast Corner of the Northwest Quarter of the Northeast Quarter of
Section 6, Township 17 South, Range 15 West, and run thence South
90 feet;
thence
West 990 feet;
thence
North 90 feet;
thence
East 990 feet to the POINT OF BEGINNING.
Tract
41-11:
The
Southeast Quarter of the Northeast Quarter of Section 1, Township 17
South, Range 16 West,
ALSO
The
Southwest Quarter of the Northwest Quarter of Section 6, Township 17
South, Range 15 West,
- 39
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LESS
AND EXCEPT THE FOLLOWING TRACTS:
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1.
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All
that part of the Southeast Quarter of the Northeast Quarter
(SE/4 NE/4) of Xxxxxxx 0, Xxxxxxxx 00 Xxxxx, Xxxxx 00
Xxxx, Xxxxx Xxxxxx, Xxxxxxxx, lying North and West of Arkansas State
Highway #335,
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2.
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All
that part of the Southwest Quarter of the Northwest Quarter
(SW/4 NW/4) of Xxxxxxx 0, Xxxxxxxx 00 Xxxxx, Xxxxx 00
Xxxx, Xxxxx Xxxxxx, Xxxxxxxx, lying North and Xxxx xx Xxxxxxxx Xxxxx
Xxxxxxx #000.
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Tract
41-12:
The East
Quarter of the Southwest Quarter of the Southeast Quarter of Section 1,
Township 17 South, Range 16 West
AND
the
Southeast Quarter of the Southeast Quarter of Section 1 Township 17
South, Range 16 West of the Fifth Principal Meridian, LESS THE FOLLOWING
TRACTS:
1. A
tract described as:
Commencing
70 yards North of the Southeast Corner of the Southeast Quarter of the Southeast
Quarter of Section 1, Township 17 South, Range 16 West, as a
BEGINNING POINT;
thence
South 70 yards;
thence
West 330 yards;
thence
North 61.5 yards;
thence in
a straight line to a POINT OF BEGINNING.
2. A
tract described as:
Beginning
at a point 70 yards North of the Southeast Corner of Section 1,
Township 17 South, Range 16 West;
thence
North 15.17 feet;
thence
West 25.00 feet;
thence
South 15.17 feet;
thence
East to the POINT OF BEGINNING.
3. A
tract described as:
Commencing
at the Southeast Corner (XXXxx) of Xxxxxxx 0, Xxxxxxxx 00 Xxxxx,
Xxxxx 00 Xxxx, Xxxxx Xxxxxx, Xxxxxxxx, and run North 89 degrees
24 minutes 22 seconds West along the South line of said Section 1
a distance of 1172.08 feet, more or less, to the center line of a county
road for the point of beginning;
thence
run North 33 degrees 28 minutes 58 seconds East
432.00 feet;
thence
North 89 degrees 21 minutes 48 seconds West
715.87 feet;
thence
South 00 degrees 16 minutes 35 seconds West 363.30 feet to
the South line of Section 1;
thence
South 89 degrees 24 minutes 22 seconds East 479.28 feet to
the point of beginning.
- 40
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4. (Monsanto
to Xxxxxxx)
Commencing
at the Southeast Xxxxxx xx Xxxxxxx 0, Xxxxxxxx 00 Xxxxx, Xxxxx 16
West, and run North 89 degrees 25 minutes West
400.0 feet;
thence
North 00 degrees 15 minutes East 199.7 feet to the POINT OF
BEGINNING;
thence
North 00 degrees 15 minutes East 150.9 feet;
thence
North 89 degrees 25 minutes West 543.7 feet to the center of
State Highway No. 335;
thence
South 33 degrees 55 minutes West along said Highway for
422.4 feet;
thence
South 89 degrees 25 minutes East 184.0 feet;
thence
North 00 degrees 15 minutes East 184.5 feet;
thence
North 89 degrees 00 minutes East 593.5 feet to the POINT OF
BEGINNING.
5. (Monsanto
to Xxxxx)
Commencing
at the Southeast Xxxxxx xx Xxxxxxx 0, Xxxxxxxx 00 Xxxxx, Xxxxx 16
West, and run North 89 degrees 25 minutes West
400.0 feet;
thence
run North 00 degrees 15 minutes East 350.6 feet to the POINT OF
BEGINNING;
thence
run North 00 degrees 15 minutes East 819.7 feet to the center of
Xxxxx Xxxxxxx Xx. 000;
thence
run South 33 degrees 55 minutes West along said Highway for
979.8 feet;
thence
run South 89 degrees 25 minutes East 543.7 feet to the POINT OF
BEGINNING.
6. (NWF
to Xxxx Timber)
The East
Quarter of the Southwest Quarter of the Southeast Quarter
(E/4 SW/4 SE/4) and all that part of the Southeast Quarter of the
Southeast Quarter (SE/4 SE/4) of Xxxxxxx 0, Xxxxxxxx 00 Xxxxx,
Xxxxx 00 Xxxx, Xxxxx Xxxxxx, Xxxxxxxx, lying Xxxx xx Xxxxxxxx Xxxxx Xxxxxxx
#000.
Tract
41-12A:
1. (Xxxxxxx
to Monsanto)
Beginning
at the Northeast Corner (NECor) of Section 00, Xxxxxxxx 00 Xxxxx,
Xxxxx 00 Xxxx, Xxxxx Xxxxxx, Xxxxxxxx, and run South 00 degrees
15 minutes West 330.0 feet;
thence
North 89 degrees 25 minutes West 400.0 feet;
thence
North 00 degrees 15 minutes East 529.7 feet;
thence
North 89 degrees 00 minutes East 375.0 feet;
thence
South 00 degrees 15 minutes West 134.85 feet;
thence
South 89 degrees 25 minutes East 25.0 feet;
thence
South 00 degrees 15 minutes West 75.05 feet to the POINT OF
BEGINNING, and being part of the Southeast Quarter of the Southeast Quarter
(SE/4 SE/4) of Section 1, and part of the Northeast Quarter of the
Northeast Quarter (NE/4 NE/4) of Section 12, all in Township 17 South,
Range 16 West.
2. (Xxxxx
to Monsanto)
Beginning
at the Southeast Corner of the Northeast Quarter of the Northeast Quarter (XXXxx
NE/4 NE/4) of Section 00, Xxxxxxxx 00 Xxxxx, Xxxxx 00 Xxxx, Xxxxx
Xxxxxx, Xxxxxxxx, and run North 89 degrees 25 minutes West
400.0 feet;
thence
North 00 degrees 15 minutes East 990.0 feet;
thence
South 89 degrees 25 minutes East 400.0 feet;
thence
South 00 degrees 15 minutes West 990.0 feet to the POINT OF
BEGINNING.
- 41
-
Tract
41-16:
The North
Half of the Southwest Quarter of Section 0, Xxxxxxxx 00 Xxxxx,
Xxxxx 00 Xxxx, Xxxxx Xxxxxx, Xxxxxxxx.
Tract
41-17:
The
Northwest Quarter of the Southwest Quarter of Section 0, Xxxxxxxx 00
Xxxxx, Xxxxx 00 Xxxx, Xxxxx Xxxxxx, Xxxxxxxx.
Tract
41-18:
The
Southwest Quarter of the Southwest Quarter (SW1/4 SW 1/4) and the West Half of
the Southeast Quarter of the Southwest Quarter (W1/2 SE1/4 SW1/4) of
Xxxxxxx 0, Xxxxxxxx 00 Xxxxx, Xxxxx 00 Xxxx, Xxxxx Xxxxxx,
Xxxxxxxx
ARTICLE
X AND
Beginning
at the Northeast Corner of the Southeast Quarter of the Southwest Quarter (SE1/4
SW1/4) of Xxxxxxx 0, Xxxxxxxx 00 Xxxxx, Xxxxx 00 Xxxx, Xxxxx
Xxxxxx, Xxxxxxxx, and run North 88 degrees 53 minutes West
695.0 feet;
thence
South 00 degrees 11 minutes West 1326.0 feet to the South line of
said forty;
thence
South 88 degrees 53 minutes East along said South line
347.5 feet;
thence
North 00 degrees 11 minutes East 1290.4 feet;
thence
South 88 degrees 53 minutes East 347.5 feet;
thence
North 00 degrees 11 minutes East 26.0 feet to the POINT OF
BEGINNING.
Railroad
Right-of-Way:
Railroad
right-of-way extending 50 feet on each side of the centerline of the
railroad track as the same is now located, on, over and across the North Half of
Section 8, the North Half of Section 9, and the North Half of
Section 10, all in Township 17 South, Range 15 West.
- 42
-
SCHEDULE
3.1
to
Security Agreement
Part
A. Location
of Each Grantor.
|
Name
of Grantor
|
Location
for purposes of UCC
|
|
Cherokee
Nitrogen Holdings, Inc.
|
Oklahoma
|
|
Northwest
Financial Corporation
|
Oklahoma
|
|
Cherokee
Nitrogen Company
|
Oklahoma
|
|
DSN
Corporation
|
Oklahoma
|
|
El
Dorado Chemical Company
|
Oklahoma
|
Part
B. Filing
Locations Last Five Years.
|
Name
of Grantor
|
Filing
locations last five years
|
|
Cherokee
Nitrogen Holdings, Inc.
|
Oklahoma
County (Central Filing), OK; Colbert County, AL
|
|
Northwest
Financial Corporation
|
Oklahoma
County (Central Filing), OK; Union County, AR
|
|
Cherokee
Nitrogen Company
|
Oklahoma
County (Central Filing), OK; Colbert County, AL
|
|
DSN
Corporation
|
Oklahoma
County (Central Filing), OK, Union County, AR
|
|
El
Dorado Chemical Company
|
Oklahoma
County (Central Filing), OK; Union County,
AR
|
Part
C. Trade
Names.
|
Name
of Grantor
|
Trade
Names
|
|
Cherokee
Nitrogen Holdings, Inc.
|
None
|
|
Northwest
Financial Corporation
|
None
|
|
Cherokee
Nitrogen Company
|
None
|
|
DSN
Corporation
|
None
|
|
El
Dorado Chemical Company
|
None
|
- 43
-
Part
D. Merger
or Other Corporate Reorganization.
|
Name
of Grantor
|
Merger
or other corporate reorganization
|
|
Cherokee
Nitrogen Holdings, Inc.
|
None
|
|
Northwest
Financial Corporation
|
None
|
|
Cherokee
Nitrogen Company
|
None
|
|
DSN
Corporation
|
None
|
|
El
Dorado Chemical Company
|
None
|
Part
E. Taxpayer
ID Numbers.
|
Name
of Grantor
|
Taxpayer
ID Numbers
|
|
Cherokee
Nitrogen Holdings, Inc.
|
00-0000000
|
|
Northwest
Financial Corporation
|
00-0000000
|
|
Cherokee
Nitrogen Company
|
00-0000000
|
|
DSN
Corporation
|
00-0000000
|
|
El
Dorado Chemical Company
|
00-0000000
|
- 44
-
SCHEDULE
3.4
to
Security Agreement
Part
A. Patents
and Patent Licenses
NONE
Part
B. Trademarks
|
Registered Trademarks
|
|||
|
Country
|
Trademark
|
Registration No.
|
Registration Date
|
|
United
States
|
El
Dorado (& Design)
|
1,427,064
|
02/03/87
|
|
United
States
|
E-2
|
833,891
|
08/22/67
|
Pending Trademark
Applications
NONE
Trademark Applications In
Preparation
NONE
Trademark
Licenses
NONE
- 45
-
EXHIBIT
X-0
XXXXX XX
XXXXXXX )
COUNTY OF
COLBERT )
after
recording return to:
Xxxxxxxxxxxx
Xxxx & Xxxxxxxxx LLP
0000
Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx,
Xxx Xxxx 00000-0000
Attention: Xxxxxx
Xxxxxxxxx
MORTGAGE,
ASSIGNMENT OF RENTS AND
SECURITY AGREEMENT, AND
FIXTURE FILING
[ALABAMA]
THIS MORTGAGE, ASSIGNMENT OF RENTS
AND SECURITY AGREEMENT,
AND FIXTURE FILING (this “Mortgage”), made as
of October __, 2007, between CHEROKEE NITROGEN HOLDINGS, INC., an Oklahoma
corporation (hereinafter called the “Mortgagor”),
Mortgagor, whose address is 00 X. Xxxxxxxxxxxx, Xxxxxxxx Xxxx,
Xxxxxxxx 00000, and Banc of America Leasing & Capital
LLC, as collateral agent for the Lenders (hereinafter called the “Mortgagee” or the
“Collateral
Agent”), Mortgagee, whose address is c/o Xxxxxxxxx X. Xxxxxx, VP; Group
Operations Manager, Bank of America, MA5-100-32-01, 000 Xxxxxxx Xx., Xxxxxx, XX
00000.
W
I T N E S S E T H:
WHEREAS, upon the terms and
conditions of a certain Term Loan Agreement, dated as of the date hereof
(collectively, such agreement, as amended, restated, supplemented or otherwise
modified from time to time, being hereinafter referred to as the “Loan Agreement”), by
and among ThermaClime, Inc., an Oklahoma corporation (“ThermaClime”),
Northwest Financial Corporation, an Oklahoma corporation, Mortgagor, Chemex I
Corp., an Oklahoma corporation, Chemex II Corp, an Oklahoma corporation,
Cherokee Nitrogen Company, an Oklahoma corporation, ClimaCool Corp., an Oklahoma
corporation, ClimateCraft, Inc., an Oklahoma corporation, Climate Master, Inc.,
a Delaware corporation, DSN Corporation, an Oklahoma corporation, El Dorado
Chemical Company, an Oklahoma corporation, International Environmental
Corporation, an Oklahoma corporation, Koax Corp., an Oklahoma corporation, LSB
Chemical Corp., an Oklahoma corporation, The Climate Control Group, Inc., an
Oklahoma corporation, Trison Construction, Inc., an Oklahoma corporation,
ThermaClime Technologies, Inc., an Oklahoma corporation, and XpediAir, Inc., an
Oklahoma corporation, as borrowers (individually and collectively, jointly and
severally, “Borrower” or “Borrowers”), LSB
Industries, Inc., as guarantor, Banc of America Leasing & Capital, LLC, as
administrative agent (the “Administrative
Agent”), the Collateral Agent and the Lenders from time to time party
thereto (the “Lenders”;
collectively with the Administrative Agent and the Collateral Agent, the “Secured Parties”),
Secured Parties have agreed to provide certain financial accommodations to
Borrowers,
upon the terms and conditions set forth in the Loan Agreement and the other Loan
Documents. Capitalized terms used but not defined herein shall have
the same meanings as such terms have in the Loan Agreement or, in the case of
capitalized terms used in the definition of “Mortgaged Property” below and not
defined in this Mortgage, the meanings ascribed to them in the Uniform
Commercial Code in effect in the State of Alabama (the “UCC”). The
terms “Cherokee Collateral” and/or “Cherokee Facility Collateral” as defined in
the Loan Agreement shall mean and refer to all Mortgaged Property and Collateral
(as defined in Section 3.05 below) described in this Mortgage;
WHEREAS, Mortgagor is an
affiliate of ThermaClime and the other Borrowers and will receive substantial
direct and indirect benefits from the making of the Term Loans under the Loan
Agreement; and
WHEREAS, it is a condition
precedent to Lenders’ making the Term Loans that Mortgagor shall have executed
and delivered to Mortgagee this Mortgage and, as an accommodation to the
Borrowers and in consideration for, and in recognition of, the substantial
direct and indirect benefits Mortgagor will receive from the making of the Term
Loans under the Loan Agreement, Mortgagor has agreed to grant this Mortgage to
secure the full and punctual payment or performance when due (after applicable
grace periods), whether at stated maturity or earlier, including by reason of
acceleration, mandatory prepayment or otherwise in accordance with the Loan
Agreement or any other Loan Document, of the Term Loans and all of the
Obligations under the Loan Documents, and any amendments or modifications to the
same (collectively, the “Secured
Obligations”), whether or not from time to time reduced or extinguished
or hereafter increased or incurred and whether enforceable or unenforceable as
against the Borrowers, or any one or more of them, now or hereafter existing, or
due or to become due, including principal, interest (including interest at the
contract rate applicable upon default accrued or accruing after the commencement
of any proceeding under the Bankruptcy Code, whether or not such interest is an
allowed claim in such proceeding), fees and costs of collection.
NOW, THEREFORE, the
undersigned, in consideration of all matters as set forth above and as more
particularly described in the Loan Agreement and the other Loan Documents, and
to secure the prompt payment and performance of all Secured Obligations, and any
extensions or renewals of same, and further to secure all other indebtedness,
fees, premiums (if any), charges, and expenses from time to time owing to
Mortgagee pursuant to this Mortgage, the Loan Agreement and the other Loan
Documents, and further to secure the performance of the covenants, conditions,
and agreements as set forth in any other documents executed in connection
herewith and as hereinafter set forth, has bargained and sold and does hereby
mortgage, grant, bargain, sell, assign, and convey unto the Mortgagee, WITH
POWER OF SALE, for the ratable benefit of the Secured Parties, their
successors and assigns, and hereby grants to the Mortgagee for the ratable
benefit of the Secured Parties, their successors and assigns, subject to the
Permitted Encumbrances defined in Section 1.02
herein below, a security interest in all of Mortgagor’s present and future
right, title and interest in, to and under the following described Land and
Improvements and any and all right, title or interest in any other real property
interests or improvements comprised in such real property, whether such right,
title or interest is acquired by Mortgagor after the date of this Mortgage, the
Equipment, and all right, title and interest of Mortgagor, if any, in and to all
personal property, and intangible personal
2
property
described below owned by Mortgagor and used in connection with the operation of
the business of Mortgagor conducted on the Land (as defined
below) (which together with any additional such property hereafter
acquired by the Mortgagor and subject to the lien of this Mortgage, as the same
may be from time to time constituted is hereinafter sometimes referred to as the
“Mortgaged
Property”) to-wit:
(a) All the
tract(s) or parcel(s) of land particularly described in Exhibit A
attached hereto and made a part hereof (the “Land”).
(b) All
buildings, structures, and improvements of every nature whatsoever now or
hereafter situated on the Land (the “Improvements”), and
all fixtures, machinery, equipment and personal property of every nature
whatsoever now or hereafter owned by the Mortgagor and attached to, located in
or on, or used in connection with the operation of said Improvements (but
excluding rolling stock and titled vehicles), including all extensions,
additions, improvements, betterments, renewals and replacements to any of the
foregoing.
(c) All
tangible personal property of every kind or character now owned or hereafter
acquired by the Mortgagor used in connection with the leasing, development, use
or operation of the Land and Improvements, whether or not subsequently removed
from the Land and the Improvements but excluding rolling stock and titled
vehicles (collectively, the “Equipment”).
(d) All
building materials, equipment, fixtures, fittings, timber to be cut, minerals as
extracted (as such terms are used in the Alabama Uniform Commercial Code), and
any other personal property of every kind or character now owned or hereafter
acquired by the Mortgagor and used in connection with the operation of the
Improvements located or to be located on the Land, whether such materials,
equipment, fixtures, fittings, and personal property are actually located on or
adjacent to said property or not, and whether in storage or otherwise,
wheresoever the same may be located, including, but without limitation, all
lumber and lumber products, bricks, building stones, and building blocks, sand
and cement, roofing material, paint, doors, windows, hardware, nails, wires and
wiring, plumbing and plumbing fixtures, heating and air conditioning equipment
and appliances, electrical and gas equipment and appliances, pipes and piping
and in general all building materials and equipment of every kind and character
used in connection with the operation of said Improvements.
(e) All
goodwill, trademarks, trade names, option rights, purchase contracts, books and
records, insurance return premiums and General Intangibles now owned or
hereafter acquired by Mortgagor relating to the Land, the Improvements or the
Equipment.
(f) All
agreements, ground leases, grants of easements or rights-of-way, permits,
declarations of covenants, conditions and restrictions, disposition and
development agreements, planned unit development agreements, cooperative,
condominium or similar ownership or conversion plans, management, leasing,
brokerage or parking agreements or other material documents affecting the Land
(the “Property
Documents”);
(g) all
proceeds of and all unearned premiums on an insurance policies relating to the
Mortgaged Property (the “Insurance
Proceeds”);
3
(h) all
rights under all agreements with any provider of goods or services of or in
connection with any construction undertaken or to be undertaken on, or services
performed or to be performed in connection with, and all licenses, certificates
of occupancy, permits, warranty agreements and other agreements (including
supply, processing, terminalling or warehousing agreements and any environmental
remediation agreements) used in or necessary to the use or operation of, the
Land or the Improvements and conduct of the Facility Business (as defined in the
Loan Agreement) thereon, therein and therefrom, including without limitation all
Material Contracts (all of the foregoing are collectively referred to herein as
the “Operating
Contracts”);
(i) all
books, records and other information, wherever located, which are in Mortgagor’s
possession, custody or control or to which Mortgagor is entitled at law or in
equity and which are related to the Mortgaged Property, including all Software
and all computer hardware or other equipment used to record, store, manage,
manipulate or access the information; and
(j) all
after-acquired title to or remainder or reversion in any of the property
described in this Section; all proceeds, replacements, substitutions, products,
accessions and increases of or for the Mortgaged Property, all additions,
accessions and extensions to, improvements of or for the Mortgaged Property; and
all additional lands, estates, interests, rights or other property described
above acquired by Mortgagor after the date of this Mortgage for use in
connection with the operation of the Land or the Improvements, all without the
need for any additional mortgage, assignment, pledge or conveyance to Mortgagee
but Mortgagor will execute and deliver to Mortgagee, upon Mortgagee’s request,
any documents reasonably requested by Mortgagee to further evidence the
foregoing.
(k) Proceeds
and products of all of the foregoing real and personal property, tangible and
intangible.
To the
fullest extent permitted by applicable law, all of the foregoing shall be deemed
a part of the real property and, at the option of Mortgagee, may be foreclosed
upon and sold upon an Event of Default in accordance with the laws relating to
mortgages of real estate.
TOGETHER with all easements,
rights of way, including any rights of ingress and egress, gores of land,
streets, sidewalks, ways, alleys, passages, sewer rights, waters, water courses,
water rights and powers, air rights and development rights, oil and mineral
rights (excepting only those rights previously conveyed or excluded as shown in
the Permitted Encumbrances) and all estates, rights, titles, interests,
privileges, liberties, tenements, hereditaments, and appurtenances whatsoever,
in any way belonging, relating or appertaining to any of the property
hereinabove described, or which hereafter shall in any way belong, relate or be
appurtenant thereto, whether now owned or hereafter acquired by the Mortgagor,
and the reversion and reversions, remainder and remainders, rents, issues, and
profits thereof, and all the estate, right, title, interest, property,
possession, claim, and demand whatsoever at law, as well as in equity, of the
Mortgagor of, in and to the same, including but not limited to:
(a) All
rents, profits, issues, and revenues of the Mortgaged Property (collectively,
the “Rents”)
from time to time accruing, whether under leases or tenancies now
4
existing
or hereafter created, reserving to Mortgagor, however, so long as Mortgagor is
not in default hereunder, the right to receive and retain the rents, issues, and
profits thereof; and
(b) All
judgments, awards of damages, and settlements hereafter made resulting from
condemnation proceedings or the taking of the Mortgaged Property or any part
thereof under the power of eminent domain, or for any damage (whether caused by
such taking) to the Mortgaged Property or any part thereof, or to any rights
appurtenant thereto, including any award for change of grade or
streets. Mortgagee hereby is authorized on behalf and in the name of
Mortgagor to execute and deliver valid acquittances for, and appeal from, any
such judgments or awards. Such sums or any part thereof so received
shall be applied in accordance with the provisions of Section 1.06
hereof.
The Mortgaged Property does not include
the Excluded Assets (as defined in the Loan Agreement), notwithstanding any
provision set forth above seemingly to the contrary.
TO HAVE AND TO HOLD the
Mortgaged Property and all parts thereof unto the Mortgagee, its successors and
assigns forever, subject however to the terms and conditions
herein:
TO
SECURE unto Mortgagee: (a) the payment and performance of all Secured
Obligations, payable according to the terms stated therein; (b) the payment of
all other sums, with interest thereon, advanced in accordance herewith to
protect the security of this Mortgage; (c) the faithful payment and performance
of the covenants and agreements of Mortgagor contained herein and the faithful
payment and performance of the covenants and agreements of the Borrowers in the
Loan Agreement and the other Loan Documents;
PROVIDED, HOWEVER, that these
presents are upon the condition that, if full payment and performance of all
Secured Obligations, including the Term Notes and the full payment and
performance of the Loan Agreement and the other Loan Documents is achieved, at
the times and in the manner stipulated therein and herein, all without any
deduction or credit for taxes or other similar charges paid by the Mortgagor,
and the Borrowers shall keep, perform, and observe all and singular the
covenants and promises in the Loan Agreement and the other Loan Documents and
Mortgagor shall keep, perform, and observe all and singular the covenants and
promises in this Mortgage expressed to be kept, performed, and observed by and
on the part of the Mortgagor, all without fraud or delay (but within any
applicable cure period), and there shall be no other uncured Event of Default
under any of the Loan Agreement and the other Loan Documents, then this
Mortgage, and all the properties, interest, and rights hereby granted,
bargained, and sold shall cease, determine, and be void.
AND the Mortgagor covenants
and agrees with the Mortgagee as follows:
ARTICLE
I
1.01 Performance of Mortgage,
Loan Agreement and other Loan Documents. The Mortgagor will
perform, observe and comply with all provisions hereof, and the Borrowers will
perform, observe and comply with all provisions of the Loan Agreement and the
other Loan Documents and duly and punctually will pay and perform all Secured
Obligations with interest thereon and all other sums required to be paid by them
pursuant to the Loan Agreement and the
5
other
Loan Documents executed in connection herewith, all without any deductions or
credit for taxes or other similar charges paid by the Mortgagor or the
Borrowers.
1.02 Warranty of
Title. The Mortgagor is lawfully seized of an indefeasible
estate in fee simple in the Land, Improvements and other real property hereby
mortgaged and has good and marketable title to all existing personal property
hereby mortgaged and has good right, full power and lawful authority to sell,
convey and mortgage the same in the manner and form aforesaid, and that, except
for the permitted liens described in Exhibit B attached
hereto and as described in Section 7.01 of the Loan Agreement (the “Permitted
Encumbrances”), the same is free and clear of all liens, charges, and
encumbrances whatsoever, including, as to the personal property and fixtures,
conditional sales contracts, chattel mortgages, security agreements, financing
statements, and anything of a similar nature, and that Mortgagor shall and will
warrant and forever defend the title thereto unto the Mortgagee, its successors
and assigns, against the lawful claims of all persons whomsoever.
1.03 Other Taxes, Utilities
and. Liens.
(a) The
Mortgagor will pay promptly, before the same becomes delinquent and after giving
effect to any extensions validly existing under applicable law, and promptly
after request therefor by Mortgagee, will exhibit promptly to the Mortgagee
receipts for the payment of, all taxes, assessments, water rates, dues, charges,
fines and impositions of every nature whatsoever imposed, levied or assessed or
to be imposed, levied or assessed upon or against the Mortgaged Property or any
part thereof, or upon the interest of the Mortgagee in the Mortgaged Property,
this Mortgage, the Loan Agreement or the other Loan Documents, as well as
all income taxes,
assessments and other governmental charges lawfully levied and imposed by the
United States of America or any state, county, municipality, borough or other
taxing authority upon the Mortgagor or in respect of the Mortgaged Property or
any part thereof, or any charge which, if unpaid, would become a lien or charge
upon the Mortgaged Property; provided, however, that Mortgagor will not be
required to pay any tax fee, assessment, governmental charge or any other
obligations that is being contested in good faith by appropriate actions or
proceedings diligently pursued and for which adequate reserves with respect
thereto have been established in conformity with the provisions of the Loan
Agreement.
(b) The
Mortgagor will pay promptly all charges by utility companies, whether public or
private, for electricity, gas, water, sewer, or other utilities.
(c) The
Mortgagor shall pay promptly all charges for labor and materials and will not
suffer any mechanic’s, laborer’s, statutory, or other lien to be filed against
any of the Mortgaged Property, unless arrangements satisfactory to Mortgagee are
made with respect thereto or unless contested in good faith by appropriate
actions or proceedings diligently pursued and for which adequate reserves with
respect thereto have been established in accordance with the provisions of the
Loan Agreement.
1.04 Insurance
Requirements.
(a) To keep
the Mortgaged Property and all other property, now or hereafter owned by
Mortgagor and located on the Mortgaged Property, constantly insured the amounts,
6
with the
coverages and under such policies and other terms and conditions as are set
forth in the Loan Agreement. All such insurance shall be carried by
companies authorized to insure in Alabama which are reasonably acceptable to
Mortgagee, and all such policies shall include a standard mortgagee’s
endorsement and loss payable clause in favor of and in form reasonably
acceptable to Mortgagee as required by the Loan Agreement. In the
event of loss in the amount of $500,000 or more, Mortgagor shall give prompt
notice thereof to the Mortgagee, who is hereby authorized and empowered to make
proof of loss, if not made promptly by Mortgagor. Each insurance
company is hereby authorized and directed to make payments for such loss
directly to the Mortgagee instead of to the Mortgagor and Mortgagee jointly, and
the insurance proceeds, or any part thereof, shall be advanced and applied in a
manner consistent with the Loan Agreement. Until the sums hereby
secured are fully paid and satisfied, Mortgagor shall not permit any insurance
to expire, lapse or be canceled unless in each instance Mortgagor acquires and
delivers to the Mortgagee new or replacement policies in accordance with the
terms of the Loan Agreement. In the event of a sale or foreclosure by
the Mortgagee, all title and interest of Mortgagor in and to such policies shall
pass to the purchaser at such sale.
(b) To
maintain general liability insurance against liability for injuries to or death
of any person or damage to or loss of property arising out of or in any way
relating to the condition of the Mortgaged Property or any part thereof, in
accordance with the terms of the Loan Agreement, for death or personal injury to
any one person, for all personal injuries and deaths resulting from any one
accident, and for property damage in any one accident, provided that the
requirements of this paragraph with respect to the amount of insurance may be
satisfied by an excess coverage policy.
(c) To
maintain insurance against such other casualties and contingencies as Mortgagee
required pursuant to Section 6.07 of the Loan Agreement.
1.05 Insurance
Policies. All insurance required hereunder shall be effective
under a valid and enforceable policy or policies issued by an insurer of
recognized responsibility approved by Mortgagee. All policies of
insurance required in Section 1.04 shall be
written or endorsed in accordance with the provisions of the Loan
Agreement. These policies shall provide that all proceeds of such
insurance (except as provided in the following sentence) shall be payable to
Mortgagee pursuant to a standard mortgagee clause to be attached to each such
policy, but subject to the provisions of Section 1.04
above. So long as no uncured Event of Default then shall exist, the
proceeds of insurance covering the interruption of Mortgagor’s business, and the
revenues from operation of the business conducted from the Mortgaged
Property damaged by an insured casualty, may be paid directly to
Mortgagor. Mortgagor shall deposit with Mortgagee copies of policies
evidencing all such insurance if so requested by Mortgagee, or a certificate or
certificates of the respective insurers stating that such insurance is in force
and effect. Mortgagor shall keep all policies of insurance constantly
assigned, pledged and delivered to the Mortgagee. Mortgagor shall pay
or cause to be paid all premiums due with respect to the same and, if so
requested by Mortgagee, furnish to Mortgagee satisfactory proof of the timely
making of such payments in accordance with the provisions of the Loan
Agreement. Each policy of insurance herein required shall contain a
provision that the insurer shall not cancel, refuse to renew or materially
modify it without giving written notice to Mortgagee at least thirty (30) days
(or, in the case of cancellation due to non-payment, such shorter period as
mandated by state law, but in no event less than ten (10) days) before the
cancellation, non-renewal or modification becomes
7
effective. At
least ten (10) Business Days before the expiration date of each expiring policy
promptly, Mortgagor shall furnish Mortgagee with evidence satisfactory to
Mortgagee that the policy has been renewed or replaced by another policy
conforming to the provisions of this Section or that there is no necessity
therefor under the terms hereof. In lieu of separate policies,
Mortgagor may maintain blanket policies having the coverage required herein, in
which event it shall deposit with Mortgagee a certificate or certificates of the
respective insurance as to the amount of coverage.
Notwithstanding
Mortgagee’s rights under Sections 1.04 and 1.05, Mortgagee will not be liable
for any loss, damage or injury resulting from the inadequacy or lack of any
insurance coverage.
If an
insured casualty occurs where (i) the loss is in an aggregate amount less
than the 20% of the outstanding principal balance of the Term Loan; (ii) in
the reasonable judgment of Mortgagee the Mortgaged Property can be restored
within one year, and prior to one year before the Maturity Date and prior to the
expiration of the rental or business interruption insurance with respect
thereto, to the Mortgaged Property’s pre-existing condition and utility as
existed immediately prior to such insured casualty and to an economic unit not
less valuable and not less useful than the same was immediately prior to the
insured casualty; and (iii) no Default or Event of Default shall have
occurred and be then continuing, then the insurance proceeds (after
reimbursement to Mortgagee of any expenses incurred by Mortgagee in collecting
such proceeds), shall be applied to reimburse Mortgagor for the cost of
restoring, repairing, replacing or rebuilding the Mortgaged Property (the “Restoration”),
in the manner set forth herein. Mortgagor shall commence and
diligently prosecute such Restoration. Notwithstanding the foregoing,
in no event shall Mortgagee be obligated to apply the proceeds to reimburse
Mortgagor for the cost of Restoration unless, in addition to satisfaction of the
foregoing conditions, Mortgagor shall pay (and if required by Mortgagee,
Mortgagor shall deposit with Mortgagee in advance) all costs of such Restoration
in excess of the net amount of the proceeds made available pursuant to the terms
hereof.
Except as
provided in the immediately preceding paragraph, after deducting the costs
incurred by Mortgagee in collecting the proceeds of any insurance, Mortgagee
may, in its sole discretion, (i) apply such proceeds as a credit against any
portion of the Secured Obligations selected by Mortgagee in its sole discretion;
(ii) apply the proceeds to restore the Improvements, provided that Mortgagee
will not be obligated to see to the proper application of the proceeds and
provided, further, that any amounts released for restoration will not be deemed
a payment on the Secured Obligations; or (iii) deliver the proceeds to
Mortgagor.
If
Mortgagor is entitled to insurance proceeds held by Mortgagee, such proceeds
shall be disbursed upon Mortgagee being furnished with (i) evidence
satisfactory to Mortgagee of the estimated cost of completion of the
Restoration, (ii) evidence reasonably satisfactory to Mortgagee of the
availability of all funds in addition to the proceeds that in Mortgagee’s
judgment are required to complete the proposed Restoration (which availability
may be evidenced by the deposit of such additional funds with Mortgagee, a
letter of credit in the amount of such additional required funds, or other
evidence reasonably satisfactory to Mortgagee as agreed with mortgagor at the
time of such event); and (iii) if appropriate in connection with
the nature of the casualty, plans and specifications or other reasonably
detailed description of
8
Mortgagor’s
plans to accomplish such Restoration (the “Plans”), such Plans to be approved by
Mortgagee for casualties where the loss is in an aggregate amount of
$2,000,000.00 or more, prior to disbursement of any proceeds, which approval
shall not unreasonably be withheld or delayed. In the event that the
Restoration is for a loss in an aggregate amount less than $2,000,000, Mortgagor
may proceed with such Restoration without prior approval of Plans therefor so
long as Mortgagor shall certify to Mortgagee prior to disbursement of any
proceeds that such Restoration complies with the other requirements of this
Section 1.05 concerning Restoration, and if requested by Mortgagee provides to
Mortgagee the Plans for such Restoration. Mortgagee shall review
Plans for a Restoration as promptly as commercially practicable after receipt of
such Plans from Mortgagor. At all times, the insurance proceeds (or,
after application of a portion of such proceeds, the undisbursed balance of such
proceeds remaining in the hands of Mortgagee), together with funds to be made
available by Mortgagor for that purpose to the satisfaction of Mortgagee, shall
be at least sufficient in the reasonable judgment of Mortgagee to pay for the
cost of completion of the Restoration, free and clear of all Liens or claims for
Lien. Provided no Event of Default then exists, any surplus that
remains out of the Proceeds held by Mortgagee after payment of such costs of
Restoration shall be paid to Mortgagor. Any surplus that remains out
of the Award received by Mortgagee after payment of such costs of Restoration
shall, in the discretion of Mortgagee, be retained by Mortgagee and applied to
payment of the Debt or returned to Mortgagor. Notwithstanding
anything set forth in this Section 1.05 to the
contrary, the conditions set forth in this Section 1.05 relate
solely to the application of proceeds of insurance covering an insured casualty,
and shall not prevent, and Mortgagor may, proceed with Restoration immediately
after any casualty without prior consent or approval by Mortgagee. subject to
compliance with the requirements for restoration and maintenance of the
Mortgaged Property set forth in Section 1.07 (“Care of the
Property”) of this Mortgage and Section 6.06 (“Maintenance of Properties;
Collateral”) of the Loan Agreement.
1.06 Condemnation. If
all or any part of the Mortgaged Property shall be damaged or taken through
condemnation (which term when used in this Mortgage shall include any damage or
taking by any governmental authority, and any transfer by private sale in lieu
thereof), either temporarily or permanently, the Secured Obligations shall
continue until satisfied in full or earlier terminated in accordance with the
Loan Agreement. The Mortgagee shall be entitled to all compensation,
awards, and other payments or relief therefor and is hereby authorized, at its
option, to commence, appear in and prosecute, in its own or the Mortgagor’s
name, any action or proceedings relating to any condemnation, and to settle or
compromise any claim in connection therewith. All such compensation.,
awards, damages, claims, rights of action and proceeds and the right thereto are
hereby assigned by the Mortgagor to the Mortgagee, and Mortgagor shall, upon
request of Mortgagee, make, execute, acknowledge and deliver any and all
additional assignments and documents as may be necessary from time to time to
enable Mortgagee to collect and receipt for any such sums. Mortgagee
shall not be, under any circumstances, liable or responsible for failure to
collect, or exercise diligence in the collection of, any of such
sums. Any sums so collected shall be applied by Mortgagee, first, to
the expenses, if any, of collection, and then in accordance with Section 2.06
hereof. Notwithstanding the foregoing, if, after such condemnation or
private sale in lieu thereof, the taking will not have a Material Adverse Effect
upon the continued operation of the Mortgaged Property and no Event of Default
has occurred and is continuing, upon request of Mortgagor, said sums so held by
Mortgagee shall be made available for such restoration and disbursed by
Mortgagee during the course of such restoration under
9
safeguards
reasonably satisfactory to Mortgagee. Any sums remaining after
completion of restoration shall be applied in accordance with Section
2.06.
1.07 Care of the
Property.
(a) The
Mortgagor will preserve and maintain the Mortgaged Property in such condition
and repair as is provided in the Loan Agreement, and will not commit or suffer
any waste and will not do or suffer to be done anything which will increase the
risk of fire or other hazard to the Mortgaged Property or any part thereof and
which is materially inconsistent with the manner Mortgagor currently operates
the Mortgaged Property.
(b) Except as
otherwise provided herein or in the Loan Agreement or other Loan Documents, no
buildings, fixtures, personal property, or other part of the Mortgaged Property
shall be removed, demolished or substantially altered without the prior written
consent of the Mortgagee (which consent shall not be unreasonably withheld),
except for improvements to, replacements of, additions to, substitutions of, and
removal or demolition of obsolete or unused facilities (“Permitted
Alterations”) provided such Permitted Alterations do not interfere with
the normal operation of the Mortgaged Property and do not cause any diminution
in its value.
(c) If the
Mortgaged Property or any material part thereof is substantially damaged by fire
or any other cause, the Mortgagor will give prompt written notice of the same to
the Mortgagee.
(d) The
Mortgagee is hereby authorized to reasonable access to enter upon and inspect
the Mortgaged Property at any time during normal business hours upon reasonable
written notice.
(e) The
Mortgagor will comply with all present and future laws, ordinances, judgments,
decrees, injunctions, writs and orders of any court, arbitrator or governmental
agency or authority, and all rules, regulations, orders, interpretations,
directives, licenses and permits, applicable to the Mortgaged Property, and all
covenants, restrictions and conditions now or later of record which may be
applicable to any of the Mortgaged Property, or to the use, manner of use,
occupancy, possession, operation, maintenance, alteration, repair or
reconstruction of any of the Mortgaged Property, except where failure to do so
could not reasonably be expected to have a Material Adverse Effect (considered
both individually and together with other such failures) on (i) the current
business, operations or condition (financial or otherwise) of the Borrowers and
their Subsidiaries taken as a whole, (ii) the current use of the Mortgaged
Property, or (iii) the value of the Mortgaged Property (assuming its current
use); provided, however, that Mortgagor may contest or dispute any of the same
by appropriate action or proceedings diligently pursued, if adequate reserves
with respect thereto have been established in accordance with the provisions of
the Loan Agreement.
(f) If all or
any part of the Mortgaged Property shall be damaged by fire or other casualty,
the Mortgagor will restore promptly the Mortgaged Property to the equivalent of
its original condition, regardless of whether or not there shall be any
insurance proceeds therefor; provided, however, if insurance proceeds are paid
in connection with such fire or other casualty, such obligation to restore the
Mortgaged Property is conditioned on Mortgagor’s receipt of
10
insurance
proceeds and making such available to the Mortgagor in accordance with this
Mortgage or the Loan Agreement. If a part of the Mortgaged Property
shall be physically damaged through condemnation, the Mortgagor will restore
promptly, repair or alter the remaining property in a manner reasonably
satisfactory to the Mortgagee; provided, however such obligation to restore,
repair or alter the remaining properties is conditioned on Mortgagor’s receipt
of any related proceeds and making such available to the Mortgagor as set forth
in Section 1.06
above.
(g) Except as
expressly permitted in the Loan Agreement or other Loan Documents, the Mortgagor
shall not sell, transfer, convey or assign all or any portion of, or any
interest in, the Mortgaged Property, except for easements and other similar
grants or interests which do not materially adversely affect the value, use or
operation of the Land and the Improvements for the purposes then currently used
or contemplated, except as otherwise allowed by the Loan Agreement.
1.08 Further Assurances, After
Acquired Property. At any time, and from time to time, upon
request by the Mortgagee, the Mortgagor will make, execute and deliver or cause
to be made, executed and delivered, to the Mortgagee and, where appropriate, to
cause to be recorded and/or filed and from time to time thereafter to be
re-recorded and/or refiled at such time and in such offices and places as shall be deemed reasonably
desirable by the Mortgagee any and all such other and further mortgages,
instruments of further assurance, certificates, financing statements and other
documents as may, in the opinion of the Mortgagee, be reasonably necessary or
desirable in order to effectuate, complete, or perfect, or to continue and
preserve the obligation of the Mortgagor under this Mortgage, and the lien and
security interest of this Mortgage as a first and prior lien and security
interest upon all of the Mortgaged Property, whether now owned or hereafter
acquired by the Mortgagor. Upon any failure by the Mortgagor so to
do, the Mortgagee may make, execute, and record any and all such mortgages,
instruments, certificates, financing statements and documents for and in the
name of the Mortgagor and, the Mortgagor hereby irrevocably appoints the
Mortgagee the agent and attorney-in-fact of the Mortgagor so to
do. The lien hereof will automatically attach, without further act,
to all after acquired property attached to and/or used in the operation of the
Mortgaged Property or any part thereof.
1.09 Leases Affecting Mortgaged
Property. The Mortgagor will comply with and observe its
material obligations as landlord under all leases affecting the Mortgaged
Property or any part thereof. If requested by Mortgagee, Mortgagor
will furnish Mortgagee with executed copies of all leases now or hereafter
created with respect to all or any part of the Mortgaged Property; and all
leases now or hereafter entered into must be approved by Mortgagee in advance of
Mortgagor becoming obligated upon any such leases. Mortgagee hereby
acknowledges that Mortgagee has approved those leases in effect with
respect to the Mortgaged Property as of the date of execution of this Mortgage
which have been previously provided or made available by Mortgagor to Mortgagee
for review. If requested by the Mortgagee, the Mortgagor will execute
one or more separate assignments to the Mortgagee of any and all such leases,
whether now existing or hereafter created, and all rents, royalties, issues, and
profits of the Mortgaged Property from time to time accruing. Except
as provided in the Loan Agreement, Mortgagor will not cancel, surrender, or
modify any lease without the written consent of the Mortgagee.
11
1.10 Appraisals. At
the Mortgagee’s request, Mortgagor will permit the Mortgagee, or its agents,
employees or independent contractors, to reasonably enter upon and appraise the
Mortgaged Property at any time and from time to time, upon written notice to
Mortgagee, and Mortgagor will cooperate with and provide any information
requested in connection with such appraisals.
1.11 Expenses. In
accordance with the provisions of the Loan Agreement, the Mortgagor will pay or
reimburse the Mortgagee for all reasonable attorney’s fees, costs, and expenses
incurred by the Mortgagee in any proceeding involving the estate of a decedent
or an insolvent, or in any action, proceeding, or dispute of any kind in which
the Mortgagee is made a party, or appears as party plaintiff or defendant,
affecting the Loan Agreement, the other Loan Documents, this Mortgage,
Mortgagor, or the Mortgaged Property, including but not limited to the
foreclosure of this Mortgage, any condemnation action involving the Mortgaged
Property, or any action to protect the security hereof; and any such amounts
paid by the Mortgagee shall bear interest at the rate provided for in the Loan
Agreement, shall be payable upon demand, and shall be secured by the lien of
this Mortgage.
1.12 Performance by Mortgagee of
Defaults by Mortgagor. If the Mortgagor shall default in the
payment of any tax, lien, assessment, or charge levied or assessed against the
Mortgaged Property (other than if such is subject to a Permitted Protest); in
the payment of any utility charge, whether public or private; in the payment of
insurance premium; in the procurement of insurance coverage and the delivery of
the insurance policies required hereunder, or in the performance or observance
of any covenant, condition, or term of this Mortgage, then the Mortgagee, at its
option, may reasonably perform or observe the same, and all payments made for
costs or incurred by the Mortgagee in connection therewith, shall be secured
hereby and shall be, without demand, immediately repaid by the Mortgagor to the
Mortgagee with thereon at the rate provided for in the Loan
Agreement. The Mortgagee shall be the sole judge of the legality,
validity and priority of any such tax, lien, assessment, charge, claim and
premium; of the necessity for any such actions and of the amount necessary to be
paid in satisfaction thereof. The Mortgagee is hereby empowered to
enter and to authorize others to enter upon the Mortgaged Property or any part
thereof for the purpose of performing or observing any such defaulted covenant,
condition or term, without thereby becoming liable to the Mortgagor or any
person in possession holding under the Mortgagor.
1.13 Books and
Records. The Mortgagor shall keep and maintain at all times
full, true and accurate books of accounts and records, adequate to reflect
correctly the results of the operation of the Mortgaged Property. The
Mortgagor will furnish to the Mortgagee with such financial information and
reports as and when provided in the Loan Agreement.
ARTICLE
II
2.01 Event of
Default. The term “Event of Default,”
wherever used in the Mortgage, shall mean any one or more of the following
events:
(a) The
occurrence of an uncured Event of Default under the Loan Agreement.
12
(b) If
Mortgagor shall be in default under any other deed of trust, mortgage or
security agreement covering any material part of the Mortgaged Property, whether
it be superior or junior in lien to this Mortgage, following expiration of any
grace periods therein; provided, however, that Mortgagor may contest: or dispute
any of the same by appropriate action or proceeding diligently pursued, if
permitted in the Loan Agreement and adequate reserves with respect thereto have
been established in accordance with the provisions of the Loan
Agreement.
(c) Except as
permitted in this Mortgage or the Loan Agreement, the material alteration,
improvement, demolition or removal of any of the Improvements located on the
Mortgaged Property without the prior consent of Mortgagee.
(d) Except as
permitted in this Mortgage or the Loan Agreement, the Mortgaged Property or any
material part thereof shall be taken on execution or other process of law in any
action against Mortgagor and there shall be a period of thirty (30) consecutive
days during which a stay of enforcement of such judgment or order, by reason of
a pending appeal or otherwise, shall not be in effect.
(e) Except as
permitted in this Mortgage or the Loan Agreement, the Mortgagor abandons all or
a portion of the Mortgaged Property.
(f) Except as
permitted in this Mortgage or the Loan Agreement, the Mortgaged Property, or any
part thereof, is subjected to waste or to removal, demolition or material
alteration so that the value of the Mortgaged Property is materially diminished
thereby and Mortgagee determines (in its subjective determination) that it is
not adequately protected from any loss, damage or risk associated
therewith.
(g) Notwithstanding
anything herein, any requirement of notice specified above shall be deemed
deleted if Mortgagee is prevented from giving notice by bankruptcy or other
applicable law, and the cure period shall be measured from the date of the event
or failure rather than from the date of notice. Nothing herein shall
require notice except where expressly set forth in this Mortgage or the Loan
Agreement.
2.02 Acceleration of
Maturity. If an Event of Default shall have occurred and is
continuing, then the Secured Obligations and performance hereunder secured
hereby with interest accrued thereon shall, at the option of the Mortgagee,
become immediately due and payable without notice or demand, time being of the
essence; and any omission on the part of the Mortgagee to exercise such option
when entitled to do so shall not be considered as a waiver of such
right.
2.03 Right of Mortgagee to Enter
and Take Possession.
(a) If an
Event of Default shall have occurred and be continuing, the Mortgagor, upon
demand of the Mortgagee, shall forthwith surrender to the Mortgagee the actual
possession, and if and to the extent permitted by law, the Mortgagee may enter
and take possession, of all the Mortgaged Property, and may exclude the
Mortgagor and its agents and employees wholly therefrom.
13
(b) Upon
every such entering upon or taking of possession, the Mortgagee may hold, store,
use, operate, manage, and control the Mortgaged Property and conduct the
business thereof, and, from time to time (i) make all necessary and proper
maintenance, repairs, renewals, replacements, additions, betterments, and
improvements thereto and thereon and purchase or otherwise acquire additional
fixtures, personalty, and other property; (ii) insure or keep the Mortgaged
Property insured; (iii) manage and operate the Mortgaged Property and exercise
all the rights and powers of the Mortgagor in Mortgagor’s name or otherwise,
with respect to the same; (iv) enter into any and all agreements with respect to
the exercise by others of any of the powers herein granted the Mortgagee, all as
the Mortgagee from time to time may determine to be to its best advantage; and
the Mortgagee may collect and receive all the income, revenues, rents, issues
and profits of the same including those past due as well as those accruing
thereafter, and, after deducting (A) all expenses of taking, holding, managing,
and operating the Mortgaged Property (including compensation for the services of
all persons employed for such purposes); (B) the cost of all such maintenance,
repairs, renewals, replacements, additions, betterments, improvements,
purchases, and acquisitions; (C) the cost of such insurance; (D) such taxes,
assessments, and other charges prior to the lien of this Mortgage as the
Mortgagee may determine to pay; (E) other proper charges upon the Mortgaged
Property or any part thereof; and (F) the reasonable compensation, expenses, and
disbursements of the attorneys and agents of the Mortgagee; shall apply the
remainder of the moneys so received by the Mortgagee to the payment of accrued
interest, to the payment of tax and insurance deposits required to pay for the
taxes and insurance policies described in Sections 1.03 and 1.04 hereof,
and to the sums hereby secured, or otherwise in payment of a portion of the
Secured Obligations, all in such order and priority as expressly set forth in
the Loan Agreement or, if not so provided in the Loan Agreement, as the
Mortgagee may determine.
(c) Whenever
all such Events of Default have been cured and satisfied, the Mortgagee shall
surrender possession of the Mortgaged Property to the Mortgagor, its successors
or assigns. The same right of taking possession, however, shall exist
if any subsequent Event of Default shall occur and be continuing.
2.04 Receiver.
(a) If an
Event of Default shall have occurred and is continuing, the Mortgagee, upon
application to a court of competent jurisdiction, shall be entitled, without
notice and without regard to the adequacy of any security for the Secured
Obligations hereby secured or the solvency of any party bound for its payment,
to the appointment of a receiver to take possession of and to operate the
Mortgaged Property and to collect the rents, profits, issues, and revenues
thereof.
(b) The
Mortgagor will pay to the Mortgagee upon demand all expenses, including
receiver’s fees, attorney’s fees and costs, and agent’s compensation, incurred
pursuant to the provisions contained in this Section; and all such expenses
shall be secured by this Mortgage.
2.05 Mortgagee’s Power of
Enforcement. If an Event of Default shall have occurred and is
continuing, the Mortgagee may, either with or without entry or taking possession
as hereinabove provided or otherwise, proceed by suit or suits at law or in
equity or any other
14
appropriate
proceeding or remedy (a) to enforce payment and performance of all Secured
Obligations (b) to foreclose this Mortgage and to sell, as an entirety or, at
the option of the Mortgagee, in separate lots or parcels, the Mortgaged
Property, and (c) to pursue any other remedy available to it, all as the
Mortgagee shall deem most effectual for such purposes. The Mortgagee
shall take action either by such proceedings or by the exercise of its powers
with respect to entry or taking possession, as the Mortgagee may
determine.
2.06 Power of
Sale. If an Event of Default shall have occurred and is
continuing, Mortgagee may ,under the power of sale herein granted to Mortgagee,
sell the Mortgaged Property to the highest bidder for cash at public auction in
front of the courthouse door in the county or counties, as may be required,
where the Mortgaged Property is located, either in person or by auctioneer,
after having first given notice of the time, place and terms of sale, together
with a description of the Mortgaged Property to be sold, by publication once a
week for three (3) successive weeks prior to said sale in some newspaper
published in said county or counties, as may be required, and, upon payment of
the purchase money, Mortgagee or any person conducting the sale for Mortgagee is
authorized to execute to the purchaser at said sale a deed to the Mortgaged
Property so purchased, and all statements of fact in such deed relating to the
nonpayment of the indebtedness hereby secured, the existence of the
indebtedness, notices of advertisement, sale, receipt of money and appointment
of substituted Mortgagee shall be prima facie evidence of the truth of such
statements. Mortgagee may bid at said sale and purchase the Mortgaged
Property, or any part thereof, if the highest bidder therefor. At the
foreclosure sale, the Mortgaged Property may be offered for sale and sold as a
whole without first offering it in any other manner or may be offered for sale
and sold in any other manner as Mortgagee may elect. The foregoing
power of sale shall in no way impair or limit any remedies otherwise available
to Mortgagee.
2.07 Waiver. Mortgagor
hereby waives any and all rights of dower, courtesy, appraisement, sale,
redemption and homestead under the laws of the State of Alabama.
2.08 Application of Foreclosure
Proceeds. The proceeds of any foreclosure sale pursuant to
Section 2.06
shall be applied as follows:
(a) First, to
the expenses of making the sale, including a reasonable attorney’s fee for such
services as may be necessary in the enforcement of the Loan Agreement and the
other Loan Documents or the foreclosure of this Mortgage;
(b) Second,
to the repayment of any money, with interest thereon at the rate provided for in
the Loan Agreement, which Mortgagee may have paid, or become liable to pay, or
which it may then be necessary to pay for taxes, insurance, assessments or other
charges, liens, or debts as hereinabove provided;
(c) Third, to
the payment and satisfaction of the Secured Obligations, including interest to
date of sale; and
(d) Fourth,
the balance, if any, shall be paid to the persons or entities entitled to such
balance under applicable law after deducting any expense of ascertaining who is
so entitled to such balance.
15
2.09 Mortgagee’s Option on
Foreclosure. If any Event of Default shall have occurred and
is continuing, at the option of the Mortgagee, this Mortgage may be foreclosed
as provided by law or in equity, in which event a reasonable attorney’s fee
shall, among other costs and expenses, be allowed and paid out of the proceeds
of the sale. In the event Mortgagee exercises its option to foreclose
this Mortgage in equity, Mortgagee may, at its option, and subject to any
Permitted Encumbrances, foreclose this Mortgage subject to the rights of any
tenants of the Mortgaged Property, and the failure to make any such tenants
parties defendants to any such foreclosure proceeding and to foreclose its
rights will not be, nor be asserted to be by the Mortgagor, a defense to any
proceedings instituted by the Mortgagee to collect the sum secured hereby, or
any deficiency remaining unpaid after the foreclosure sale of the Mortgaged
Property.
2.10 Waiver of
Exemption. Mortgagor waives all rights of exemption pertaining
to real or personal property as to any indebtedness secured by or that may be
secured by this Mortgage, and Mortgagor waives the benefit of any statute
regulating the obtaining of a deficiency judgment or requiring that the value of
the Mortgaged Property be set off against any part of the sums secured
hereby.
2.11 Suits to Protect the
Mortgaged Property. If an Event of Default shall have occurred
and is continuing, the Mortgagee shall have power (a) to institute and maintain
such suits and proceedings as it may deem expedient to prevent any impairment of
the Mortgaged Property by any acts which may be unlawful or any violation of
this Mortgage, (b) to preserve or protect its interest in the Mortgaged Property
and in the income, revenues, rents, and profits arising therefrom, and (c) to
restrain the enforcement of or compliance with any legislation or other
governmental enactment, rule, or order that may be unconstitutional or otherwise
invalid, if the enforcement of or compliance with such enactment, rule or order
would impair the security hereunder or be prejudicial to the interest of the
Mortgagee.
2.12 Mortgagor to Pay and Perform
all Secured Obligations on Any Event of Default; Application of Moneys by
Mortgagee. If an Event of Default occurs and is continuing
then, upon demand of the Mortgagee, the Mortgagor will pay to the Mortgagee the
whole amount of the Secured Obligations; and in case the Mortgagor shall fail to
pay the same forthwith upon such demand, the Mortgagee shall be entitled to xxx
for and to recover judgment for the whole amount so due and unpaid together with
costs, which shall include the reasonable compensation, expenses, and
disbursements of the Mortgagee’s agents and attorneys.
2.13 Delay or Omission No
Waiver. No delay or omission of the Mortgagee or of any holder
of the Term Notes to exercise any right, power, or remedy accruing upon any
default or Event of Default shall exhaust or impair any such right, power, or
remedy or shall be construed to be a waiver of any such default or Event of
Default, or acquiescence therein; and every right, power, and remedy given by
this Mortgage to the Mortgagee may be exercised from time to time and as often
as may be deemed expedient by the Mortgagee.
2.14 No Waiver of One Default to
Affect Another, etc. No waiver of any default or Event of
Default hereunder shall extend to or shall affect any subsequent or any other
then existing default or Event of Default of shall impair any rights, powers, or
remedies consequent thereon.
16
If the
Mortgagee (a) grants forbearance or an extension of time for the payment of or
performance of the Secured Obligations secured hereby; (b) takes other or
additional security for the payment thereof; (c) waives or does not exercise any
right granted herein or in the Loan Documents; (d) releases any part of the
Mortgaged Property from the lien of this Mortgage or otherwise changes any of
the terms of the Loan Agreement or the other Loan Documents or this Mortgage;
(e) consents to the filing of any map, plat, or replat thereof;
(f) consents to the granting of any easement thereon; or (g) makes or
consents to any agreement subordinating the lien or charge hereof, any such act
or omission shall not release, discharge, modify, change, or affect the original
liability of the Borrowers under the Loan Agreement or the other Loan Documents,
or of the Mortgagor under this Mortgage or otherwise or any subsequent purchaser
of the Mortgaged Property or any part thereof, or any maker, co-signer,
endorser, surety, or guarantor; nor shall any such act or omission preclude the
Mortgagee from exercising any right, power, or privilege herein granted or
intended to be granted in the event of any other default then made or of any
subsequent default, nor, except as otherwise expressly provided in an instrument
or instruments executed by the Mortgagee, shall the lien of this Mortgage be
altered thereby. In the event of the sale or transfer by operation of
law or otherwise of all or any part of the Mortgaged Property, the Mortgagee, at
its option, without notice to any person or corporation hereby is authorized and
empowered to deal with any such vendee or transferee with reference to the
Mortgaged Property or the Secured Obligations secured hereby, or with reference
to any of the terms or conditions hereof, as fully and to the same extent as it
might deal with the original parties hereto and without in any way releasing or
discharging any of the liabilities or undertakings hereunder.
2.15 Discontinuance of
Proceedings—Position of Parties, Restored. In case the
Mortgagee shall have proceeded to enforce any right or remedy under this
Mortgage by foreclosure, entry, or otherwise, and such proceedings shall have
been discontinued or abandoned for any reason, or shall have been determined
adversely to the Mortgagee, then and in every such case the Mortgagor and the
Mortgagee shall be restored to their former positions and rights hereunder, and
all rights, powers, and remedies of the Mortgagee shall continue as if no such
proceeding has been taken.
2.16 Remedies
Cumulative. No right, power, or remedy conferred upon or
reserved to the Mortgagee by this Mortgage is intended to be exclusive of any
right, power, or remedy, but each and every such right, power, and remedy shall
be cumulative and concurrent and shall be in addition to any other right, power,
and remedy given hereunder or now or hereafter existing at law or in equity or
by statute.
2.17 Rights of a Secured
Party. Upon the occurrence of an Event of Default that is
continuing, the Mortgagee, in addition to any and all remedies it may have or
exercise under this Mortgage, the Loan Agreement, the other Loan Documents or
under applicable law, may immediately and without demand, exercise any and all
of the rights of a secured party upon default under the UCC, all of which shall
be cumulative. Such rights shall include, without
limitation:
(a) The right
to take possession of the Collateral (as hereinafter defined in Section 3.05 hereof) without
judicial process and to enter upon any premises where the Collateral may be
located for the purposes of taking possession of, securing, removing, and/or
17
disposing
of the Collateral without interference from Mortgagor or any Borrower and
without any liability for rent, storage, utilities or other sums;
(b) The right
to sell, lease, or otherwise dispose of any or all of the Collateral, whether in
its then condition or after further processing or preparation, at public or
private sale, and unless the Collateral is perishable or threatens to decline
speedily in value or is of a type customarily sold on a recognized market,
Mortgagee shall give to Mortgagor at least ten (10) days’ prior notice of the
time and place of any public sale of the Collateral or of the time after which
any private sale or other intended disposition of the Collateral is to be made,
all of which Mortgagor agrees shall be reasonable notice of any sale or
disposition of the Collateral;
(c) The right
to require Mortgagor, upon request of Mortgagee, to assemble and make the
Collateral available to Mortgagee at a place reasonably convenient to Mortgagor
and Mortgagee; and
(d) The right
to notify account debtors for obligations in which Mortgagee has an interest as
set forth in this Mortgage, and demand and receive payment
therefrom.
To
effectuate the rights and remedies of Mortgagee upon and during the continuance
of an Event of Default, Mortgagor does hereby irrevocably appoint Mortgagee
attorney-in-fact for Mortgagor, with full power of substitution following the
occurrence and during the continuance of an Event of Default to sign, execute,
and deliver any and all instruments and documents and do all acts and things to
the same extent as Mortgagor could do, and to sell, assign, and transfer any
Collateral to Mortgagee or any other party.
ARTICLE
III
3.01 Successors and Assigns
Included in Parties. Whenever in this Mortgage one of the
parties hereto is named or referred to, the heirs, administrators, executors,
successors, and assigns of such party shall be included, and all covenants and
agreements contained in this Mortgage by or on behalf of the Mortgagor or by or
on behalf of Mortgagee shall bind and inure to the benefit of its respective
heirs, administrators, executors, successors, and assigns, whether so expressed
or not.
3.02 Sale of Mortgaged
Property/Termination of
Mortgage. If the Mortgagor is permitted to sell the Mortgaged
Property pursuant to the Loan Agreement, then, upon such sale in accordance with
the terms and conditions of the Loan Agreement and upon Mortgagee’s satisfaction
that all of the conditions for the sale of the Mortgaged Property under the Loan
Agreement have been satisfied, Mortgagee shall release this Mortgage of record,
and this Mortgage shall be terminated.
3.03 Headings,
etc. The headings of the articles, sections, paragraphs, and
subdivisions of this Mortgage 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.
3.04 Invalid Provisions to Affect
No Others. In case any one or more of the covenants,
agreements, terms, or provisions contained in this Mortgage or in the Loan
Agreement or the other Loan Documents shall be invalid, illegal, or
unenforceable in any respect, the validity of the
18
remaining
covenants, agreements, terms, and provisions contained herein and in the Loan
Agreement or the other Loan Documents shall in no way be affected, prejudiced,
or disturbed thereby.
3.05 Security Agreement;
Collateral; Fixture Filing. In addition to the foregoing grant
of mortgage, by executing and delivering this Mortgage the Mortgagor hereby
grants a continuing security interest to the Mortgagee for the benefit of the
Lenders in that portion of the Mortgaged Property in which a security interest
can be created and perfected under the UCC (said personal property,
tangible and intangible, being collectively referred to in this Mortgage as the
“Collateral”).
This instrument shall constitute a “security agreement”, “fixture filing” and
“financing statement” under the UCC or other law applicable to the creation of
liens upon and security interests in personal property. Mortgagor
authorizes and consents to the Mortgagee filing financing statements covering
the Collateral with the Office of the Secretary of State for Alabama and the
real estate records of the Office of the Judge of Probate of Colbert County,
Alabama and covenants and agrees to execute, file, and refile such financing
statements, continuation statements or other documents as Mortgagee shall
require from time to time with respect to such Collateral. If an
Event of Default occurs and is continuing, the Mortgagee shall have all rights
and remedies of a secured party under the UCC or other law applicable to liens
upon and security interests in personal property. In addition, the
Mortgagee may file a financing statement in any office or jurisdiction where
filing is deemed necessary or desirable by Mortgagee without the consent of
Mortgagor, and if requested to do so, Mortgagor will join in the execution of
same as requested by Mortgagee and will pay all costs of any
filing.
To the
extent permitted by law, certain of the Mortgaged Property is or will become
“fixtures” (as that term is defined in the UCC) on the Land, and this
instrument, upon recording or registration in the real estate records of the
county wherein such fixtures are situated, shall operate also as a financing
statement filed as a fixture filing in accordance with the applicable provisions
of said UCC upon such of the Mortgaged Property that is or may become fixtures.
To that end, for such purpose, Mortgagor acknowledges that: (i) this
Mortgage covers goods which are or are to become fixtures on the Land, (ii) this
financing statement is to be recorded in the real estate records of the Office
of the Judge of Probate of Colbert County, Alabama, (iii) Mortgagor is the
record owner of the fee interest in the Land, and (iv) products of such goods
are also covered by this financing statement. Mortgagor, as “debtor”,
for purposes of the UCC, also represents to Mortgagee, as of the date hereof,
that the following information set forth in clauses (i), (v) and (vi) below, is
true and correct:
(i) The
“Debtor” is the Mortgagor and the “Secured Party” is the Collateral Agent for
the benefit of the Secure Parties. The exact legal name and address
of the Debtor are:
Cherokee
Nitrogen Holdings, Inc.
00 Xxxxx
Xxxxxxxxxxxx
Xxxxxxxx
Xxxx, Xxxxxxxx 00000
(ii) Name and address of Secured
Party :
Banc of
America Leasing & Capital LLC
c/o
Xxxxxxxxx X. Xxxxxx, VP; Group Operations Manager
19
Bank of
America
MA5-100-32-01
000
Xxxxxxx Xx.
Xxxxxx,
XX 00000
(iii) Description of the types (or
items) of property covered by this financing statement: all of
the property comprising the Mortgaged Property other than the Land.
(iv) Description of real estate
to which collateral is attached or upon which it is
located: Described in Exhibit
A.
(v) Debtor’s Organizational and
Tax Identification Numbers:
Org
No.
N/A
Tax
ID
00-0000000
(vi) The
debtor’s chief executive office is located in the State of Oklahoma, and the
debtor’s state of formation is the State of Oklahoma.
Information
concerning the security interest herein granted may be obtained from the parties
at the addresses of the parties set forth in the first paragraph of this
Mortgage. Any reproduction of this Mortgage or of any other security agreement
or financing statement is sufficient as a financing statement.
3.06 Covenant Regarding
Compliance. Mortgagor shall keep and maintain the Mortgaged
Property in compliance with, and shall not cause, permit or suffer the Mortgaged
Property to be in violation of any Environmental Law (as defined below), except
for noncompliance that could not reasonably be expected to have a Material
Adverse Effect.
3.07 Notice. Mortgagor
represents and warrants to Mortgagee as of the date of the Loan Agreement, the
date of the Borrowing Notice and the date of the Borrowing Date (as each such
term is defined in the Loan Agreement) that Mortgagor has not received any
notice of a violation of any Environmental Law, nor incurred any previous
liability therefor, except as disclosed in writing to Mortgagee in connection
with the Loan Agreement. To the extent that such could reasonably be
expected to (i) have a Material Adverse Effect (as defined in the Loan
Agreement) or (ii) cause the Mortgaged Property to be subject to any
restrictions on ownership, occupancy, liability, use or transferability under
any Environmental Law, Mortgagor shall give prompt written notice to
Mortgagee of:
(a) becoming
aware of any violation of Environmental Law on the Mortgaged Property, or any
use, generation, manufacture, production, storage, release, discharge or
disposal of any Hazardous Materials on, under, from or about the Mortgaged
Property or the migration thereof to or from the Mortgaged Property in each case
in violation of any Environmental Law;
(b) the
commencement or institution of any proceeding, inquiry or action by or notice
from any governmental authority with respect to the use or presence of any
Hazardous Materials on the Mortgaged Property or the migration thereof from or
to other property;
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(c) all
claims made by any third party against Mortgagor or the Mortgaged Property
relating to any damage, contribution, cost recovery, compensation, loss or
injury resulting from any Hazardous Materials;
(d) Mortgagor’s
discovery of any occurrence or condition on any real property adjoining or in
the vicinity of the Mortgaged Property that could cause the Mortgaged Property
or any part thereof to be subject to any restrictions on the ownership,
occupancy, transferability or use of the Mortgaged Property under any
Environmental Law, or to be otherwise subject to any restrictions on the
ownership, occupancy, transferability or use of the Mortgaged Property under any
Environmental Law.
3.08 Indemnity. Mortgagor
shall protect, indemnify and hold harmless Mortgagee, its directors, officers,
employees, agents, successors and assigns (each, an “Indemnitee”) from and
against any and all claims, loss, damage, cost, expense, liability, fines,
penalties, charges, administrative and judicial proceedings and orders,
judgments, remedial action requirements, enforcement actions of any kind
(including, without limitation, attorneys’ fees and costs), or any other
Environmental Liability, directly or indirectly arising out of or attributable
to, in whole or in part, the breach of any Environmental Laws, the covenants,
representations and warranties of this Section or the use, generation,
manufacture, production, storage, release, threatened release, discharge,
disposal, or presence of a Hazardous Materials on, under, from or about the
Mortgaged Property, whenever the same shall have occurred, whether before or
after the date of this Mortgage, or any other activity carried on or undertaken
on or off the Mortgaged Property, whenever the same shall have occurred, whether
before or after the date of this Mortgage, whether by Mortgagor or any
employees, agents, contractors or subcontractors of Mortgagor, or any third
persons occupying or present on the Mortgaged Property, in connection with the
handling, treatment, removal, storage, decontamination, clean-up, transport or
disposal of any Hazardous Materials located or present on, under, from or about
the Mortgaged Property, including, without limitation: (i) all consequential
damages; (ii) the costs of any required or necessary repair, cleanup or
detoxification of the Mortgaged Property and the preparation and implementation
of any closure, remedial or other required plans including, without limitation:
(A) the costs of removal or remedial action incurred by the United States
Government or the State, or response costs incurred by any other person, or
damages from injury to, destruction of, or loss of natural resources, including
the costs of assessing such injury, destruction or loss, incurred pursuant to
the Comprehensive Environmental Response, Compensation and Liability Act of
1980, 42 U.S.C. § 9601 et seq. as
amended; and (B) the costs and expenses of abatement, correction or clean-up,
fines, damages, response costs or penalties which arise from the provisions of
any other statute, state or federal; or any other Environmental Laws; and (iii)
liability for personal injury or property damage arising under any statutory or
common-law tort theory, including damages assessed for the maintenance of the
public or private nuisance, response costs or for the carrying on of an
abnormally dangerous activity or any other Environmental Liability, IN ALL
CASES, WHETHER OR NOT CAUSED BY OR ARISING, IN WHOLE OR IN PART, OUT OF THE
COMPARATIVE, CONTRIBUTORY OR SOLE NEGLIGENCE OF THE INDEMNITEE; provided that such
indemnity shall not, as to any Indemnitee, be available to the extent that such
losses, claims, damages, liabilities or related expenses (x) are determined
by a court of competent jurisdiction by final and nonappealable judgment to have
resulted from the gross negligence or willful misconduct of such Indemnitee or
(y) result from a claim brought by Mortgagor or any other Loan Party
against an Indemnitee for breach in bad faith of such
21
Indemnitee's
obligations hereunder or under any other Loan Document, if such Mortgagor or
such Loan Party has obtained a final and nonappealable judgment in its favor on
such claim as determined by a court of competent jurisdiction.
The
foregoing indemnity shall further apply to any residual contamination on, under,
from or about the Mortgaged Property. or affecting any natural
resources arising in connection with the use, generation, manufacturing,
production, handling, storage, transport, discharge or disposal of any such
Hazardous Materials whenever the same shall have occurred, whether before or
after the date of this Mortgage, and irrespective of whether any of such
activities were or will be undertaken in accordance with Environmental Law or
other applicable laws, regulations, codes and ordinances. This
indemnity is intended to be operable under 42 U.S.C. Section
9607(e)(1), and any successor Section thereof and shall survive the reconveyance
of the lien of this Mortgage, the extinguishment of the lien by foreclosure or
action in lieu thereof, and any transfer of the Mortgaged Property by
Mortgagor.
The
foregoing indemnity shall in no manner be construed to limit or adversely affect
Mortgagee’s rights under this Section, including, without limitation,
Mortgagee’s rights to approve any remedial work or the contractors and
consulting engineers retained in connection therewith.
3.09 Inspection. In
the event that (i) an Event of Default has occurred or (ii) Mortgagee
reasonably believes that there may be a violation or threatened violation by
Mortgagor of any Environmental Law or a violation or threatened violation by
Mortgagor of any covenant under this Section, Mortgagee is authorized, upon
reasonable advance notice to Mortgagor, but not obligated, by itself, its
agents, employees or workmen to enter at any reasonable time upon any part of
the Mortgaged Property for the purposes of inspecting the same for Hazardous
Materials and Mortgagor’s compliance with this Section, and such inspections may
include, without limitation, soil borings. Mortgagor agrees to pay to
Mortgagee, upon Mortgagee’s demand, all reasonable third party expenses, costs
or other amounts incurred by Mortgagee in performing any inspection for the
purposes set forth in this Subparagraph
3.09.
3.10 Costs and Expenses of
Mortgagee. All reasonable third party costs and expenses
incurred by Mortgagee under Section 3 and all
subparagraphs thereof shall be immediately due and payable upon demand and shall
become part of the indebtedness secured hereby and shall bear interest at the
rate set forth in the Loan Agreement from the date of payment by Mortgagee until
repaid.
3.11 Definitions. The
following terms shall have the following meanings for purposes of this Section 3 and all
subparagraphs thereof:
(a) “Environmental Laws”
means any and all present and future Federal, state, local, and foreign
statutes, laws, regulations, ordinances, rules, judgments, orders, decrees,
directives, permits, concessions, grants, franchises, licenses, agreements or
governmental restrictions relating to pollution, industrial hygiene,
environmental conditions, the protection of human health or the environment or
the release of any materials into the environment, including those related to
hazardous substances or wastes, air emissions, soil and ground water
contamination, discharges to waste or public systems, or the assessment,
monitoring or
22
remediation
of the same, as may be amended from time to time, including, without limitation,
the Comprehensive Environmental Response, Compensation, and Liability Act of
1980 (“CERCLA”)
as amended, 42 U.S.C. Sections 9601 et seq., and the Resource
Conservation and Recovery Act of 1976 (“RCRA”), 42
U.S.C. Sections 6901 et seq.
(b) “Environmental
Liability” means any claim, demand, order, suit, obligation, cost,
liability, contingent or otherwise (including any liability for damages, costs
of environmental remediation, monitoring, fines, penalties or indemnity
obligations), loss or expense (including attorneys’ and consultants’ fees and
expenses), whenever the same shall have occurred, whether before or after the
date of the Loan, of Mortgagor, any other Loan Party (other than Parent) or any
of their respective Subsidiaries (other than the Excluded Subsidiaries) directly
or indirectly resulting from or based upon (a) violation of any Environmental
Law, (b) the generation, use, handling, processing, labeling, recycling,
transportation, storage, treatment or disposal of any Hazardous Materials, (c)
exposure to any Hazardous Materials, (d) the release or threatened release of
any Hazardous Materials into the environment, (e) alleged personal injury or
property damage arising under any statutory or common-law tort theory, including
damages assessed for the maintenance of a public or private nuisance, response
costs or for the carrying on of an abnormally dangerous activity, or (f) any
contract, agreement or other consensual arrangement pursuant to which liability
is assumed or imposed with respect to any of the foregoing.
(i) “Hazardous Materials”
shall mean all explosive or radioactive substances or wastes and all hazardous
or toxic substances, wastes or other pollutants, including petroleum or
petroleum distillates, asbestos or asbestos-containing materials,
polychlorinated biphenyls, radon gas, infectious or medical wastes and all other
substances or wastes of any nature regulated pursuant to any Environmental
Law.
(c) “Requirement of Law”
shall mean the common law and all federal, state, local and foreign laws, rules
and regulations, orders, judgments, decrees and other determinations of any
Governmental Authority or arbitrator, applicable to or binding to the person or
property in question.
3.12 Representations and
Warranties. Mortgagor represents and warrants to Mortgagee and
the Lenders as of the date of the Loan Agreement, the date of the Borrowing
Notice and the date of the Borrowing Date (as each such term is defined in
Section 3.07 above), knowing that the Lenders will rely on such representations
and warranties as incentive to make the Term Loans to the Borrowers, that,
except as otherwise provided in, or disclosed as a schedule to, the Loan
Agreement.
(a) Mortgagor
is a duly organized and existing corporation having full corporate power and
authority to consummate the transactions contemplated by this Mortgage, and the
execution, delivery and performance of this Mortgage, and the documents executed
in connection herewith have been duly authorized by all necessary corporate
action.
(b) All
utility and sanitary sewage services necessary for the current use of the
Mortgaged Property and all roads necessary for the current use of the Mortgaged
Property are
23
available
pursuant to permanent private or public easements which are not subject to the
exclusive rights of any other persons which could interfere with Mortgagor’s use
thereof.
(c) There are
no proceedings pending, or, to the best of Mortgagor’s knowledge, threatened, to
acquire any power of condemnation or eminent domain with respect to the
Mortgaged Property, or any interest therein, or to enjoin or similarly prevent
the use of any of the Mortgaged Property as presently used.
(d) The
Mortgaged Property complies with all applicable laws, ordinances, rules and
regulations, and all laws, ordinances, rules and regulations relating to zoning,
building codes, set back requirements and environmental matters except where as
such violation in the aggregate will not result in a Material Adverse Effect, or
such violation is subject to a Permitted Protest or is disclosed in Section 5.09
of the Loan Agreement.
(e) Except as
set forth on Exhibit
B hereto, there are no leases affecting the Mortgaged
Property. Each lease, if any, is in full force and effect, and no
rents have been discounted, released, waived, compromised or otherwise
discharged except for prepayment of rent of not more than one month prior to the
accrual thereof. There are no material defaults now existing under
any of the leases by the landlord or tenant, and there exists no state of facts
which, with the giving of notice or lapse of time or both, would constitute a
default under any of the leases by the landlord or tenant. Each lease
is subject and subordinate to the Mortgage. Each lease is subject to
no lien, charge or encumbrance other than this Mortgage, except Permitted
Encumbrances. No tenant under a lease or any other person has an
option or right of first refusal to purchase any portion of the Mortgaged
Property. No tenant under any lease has, as of the date hereof, paid
rent more than thirty (30) days in advance, and the rents under such leases have
not been waived, released, or otherwise discharged or compromised.
(f) All
easement agreements, covenants or restrictive agreements, supplemental
agreements and any other instruments mortgaged hereby are and will remain valid,
subsisting and in full force and effect in accordance with their terms, unless
the failure to remain valid, subsisting and in full force and effect, could not,
individually or in the aggregate, have or result in a Material Adverse Effect,
and Mortgagor is not in default thereunder and has fully performed the material
terms thereof required to be performed through the date hereof, and has no
knowledge of any default thereunder or failure to fully perform the terms
thereof by any other party, nor of the occurrence of any event which after
notice or the passage of time or both will constitute a default thereunder
which, in each such instance, could, individually or in the aggregate, have or
result in a Material Adverse Effect.
(g) This
Mortgage, when duly recorded in the appropriate public records and when
financing statements are duly filed in the appropriate public records, will
create a valid, perfected and enforceable first priority lien upon and security
interest in all the Mortgaged Property free and clear of all Liens other than
the Permitted Encumbrances and there are no defenses or offsets to this Mortgage
or to any of the Secured Obligations secured hereby.
(h) The
Mortgaged Property is not part of a larger tract of land owned by Mortgagor or
its Affiliates, nor is it otherwise included under any unity of title or similar
covenant with other real property not encumbered by this Mortgage.
24
(i) The
Mortgaged Property is covered by a title insurance policy (the “Title Insurance
Policy”), insuring Mortgagor, its successors and assigns, as to its fee simple title to
the Mortgaged Property free of all Liens except Permitted
Encumbrances. No claims have been made under such Title Insurance
Policy and Mortgagor has not, by act or
omission, done anything which would impair the coverage of such title insurance
policy.
(j) The
Mortgaged Property, including without limitation the location, existence, use,
occupancy and operation of the Mortgaged Property, is in compliance in all
material respects with all applicable Laws including without limitation the
building and zoning laws of the jurisdiction in which the Mortgaged Property is
situated and all easements, declarations, covenants and restrictions affecting
the Mortgaged Property, except where such violation is subject to a Permitted
Protest or would not have a Material Adverse Effect. All material
licenses and permits which may be required with respect to the use, occupancy,
operation and maintenance of the Mortgaged Property have been obtained and are
in full force and effect and each improvement located on the Mortgaged Property
complies therewith. Except as disclosed in Section 5.09 of the Loan
Agreement, no notice of any violation of any Requirement of Law has been entered
or received by Mortgagor and to Mortgagor’s knowledge there is no basis for the
entering of any such notice.
(k) All
streets, roads., highways, bridges and waterways necessary for access to and
full use, occupancy, operation and disposition of the Mortgaged Property have
been completed, have been dedicated to and accepted by the appropriate municipal
authority and are open and available to the Mortgaged Property without further
condition or cost to Mortgagor.
(l) The
Mortgaged Property is free and clear of any mechanics’ or materialmen’s liens or
liens in the nature thereof, and no rights are outstanding that under law would
give rise to any such liens, any of which liens are or may be prior to, or equal
with, the lien of this Mortgage, except those which are insured against by the
Mortgagee’s title insurance policy.
(m) No lease
or contract or easement, right of way, permit or declaration relating to the
Mortgaged Property (collectively, “Property Agreements”)
provides any party with the right to obtain a lien or encumbrance upon the
Mortgaged Property superior to the lien of this Mortgage.
(n) Mortgagor
has delivered to Mortgagee true, correct and complete copies of all Property
Agreements that provides to any party the right to obtain a lien or encumbrance
upon the Mortgaged Property and no default exists or which the passing of time
or the giving of notice or both would exist under any Property Agreement which
would, in the aggregate, have a Material Adverse Effect.
(o) The
Mortgaged Property forms no part of any property owned, used or claimed by
Mortgagor as a residence or business homestead and is not exempt from forced
sale under the laws of the state in which the Mortgaged Property is
located. Mortgagor hereby disclaims and renounces each and every
claim to all or any portion of the Mortgaged Property as a homestead and the Term
Notes evidenced by the Loan Agreement and the other Loan Documents are issued
solely for business, investment, commercial or other similar
purposes.
25
(p) There are
no outstanding options or rights of first offer or refusal to purchase all or
any portion of the Mortgaged Property or Mortgagor’s interest therein or
ownership thereof
3.13 Notices. Any
and all notices, elections or demands permitted or required to be made under
this Mortgage, the Loan Agreement and the other Loan Documents, or any other
agreement executed in connection with or relating to the Loan Agreement and the
other Loan Documents or this Mortgage, or by applicable law, shall be given and
be deemed effective (a) on the date delivered in person, (b) three (3) days
following the date deposited with the U.S. Mail, certified or
registered, postage prepaid, return receipt requested, or (c) one (1) business
day following the date sent by Federal Express or overnight U.S. Mail
or other national overnight carrier, and addressed in each such case to the
parties at their respective addresses set forth in the heading of this
instrument or such other single address as either party may designate in a
written notice given as herein provided (except that a change of address notice
shall not be effective until actual receipt).
3.14 Controlling
Law. THE VALIDITY, INTERPRETATION, ENFORCEMENT AND EFFECT OF
THIS MORTGAGE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
OF THE STATE OF ALABAMA.
3.15 Waiver of Jury
Trial. MORTGAGOR HEREBY WAIVES ANY RIGHT THAT IT MAY HAVE TO A
TRIAL BY JURY ON ANY CLAIM, COUNTERCLAIM, SETOFF, DEMAND, ACTION OR CAUSE OF
ACTION (A) ARISING OUT OF OR IN ANY WAY RELATED TO THIS MORTGAGE, THE LOAN
AGREEMENT OR THE OTHER AGREEMENTS, OR (B) IN ANY WAY CONNECTED WITH OR
PERTAINING OR RELATED TO OR INCIDENTAL TO ANY DEALINGS OF MORTGAGEE AND/OR
MORTGAGOR WITH RESPECT TO THE LOAN AGREEMENT OR THE OTHER AGREEMENTS OR IN
CONNECTION WITH THIS MORTGAGE OR THE EXERCISE OF EITHER PARTY’S RIGHTS AND
REMEDIES UNDER THIS MORTGAGE, THE LOAN AGREEMENT OR THE OTHER AGREEMENTS OR
OTHERWISE, OR THE CONDUCT OR THE RELATIONSHIP OF THE PARTIES HERETO, IN ALL OF
THE FOREGOING CASES WHETHER NOW EXISTING OR HEREAFTER ARISING AND WHETHER
SOUNDING IN CONTRACT, TORT OR OTHERWISE. MORTGAGOR AGREES THAT
MORTGAGEE MAY FILE A COPY OF THIS AGREEMENT WITH ANY COURT AS WRITTEN EVIDENCE
OF THE KNOWING, VOLUNTARY, AND BARGAINED AGREEMENT OF MORTGAGOR IRREVOCABLY TO
WAIVE ITS RIGHTS TO TRIAL BY JURY AS AN INDUCEMENT OF LENDERS TO PURCHASE THE
NOTES FROM BORROWERS, AND THAT, TO THE EXTENT PERMITTED BY APPLICABLE LAW, ANY
DISPUTE OR CONTROVERSY WHATSOEVER BETWEEN MORTGAGOR AND MORTGAGEE SHALL INSTEAD
BE TRIED IN A COURT OF COMPETENT JURISDICTION BY A JUDGE SITTING WITHOUT A
JURY.
3.16 Date of
Mortgage. The date of this Mortgage is intended as a date for
the convenient identification of this Mortgage and is not intended to indicate
that this Mortgage was executed and delivered on that date.
26
3.17 Assignment of Leases and
Rents; Collection of Rents, Issues and Profits; Approval of
Leases.
(a) Assignment of Leases and
Rents. Mortgagor assigns all leases, licenses and other
occupancy agreements (“Leases”) and all
rents, issues and profits to Mortgagee absolutely and unconditionally and not
merely as additional collateral or security for the payment and performance of
the Secured Obligations, but subject to a license back to Mortgagor as set forth
below. Mortgagor appoints Mortgagee as Mortgagor’s attorney-in-fact
to execute unilaterally and record, at Mortgagee’s election, a document
subordinating this Mortgage to the Leases, provided that the subordination will
not affect (i) the priority of Mortgagee’s entitlement to any insurance or
condemnation proceeds or (ii) the priority of this Mortgage over intervening
liens or liens arising under or with respect to the Leases.
(b) Mortgagor’s Authority to
Collect and Retain Rents. Mortgagee confers upon Mortgagor a
license to collect and retain the rents, issues and profits of the Mortgaged
Property as they become due and payable, subject, however, to the right of
Mortgagee to revoke such license at any time following the occurrence of an
Event of Default in its sole discretion and without notice to
Mortgagor. If an Event of Default shall have occurred and is
continuing, Mortgagee shall have the absolute right to revoke such authority and
collect and retain the rents, issues and profits assigned herein, without taking
possession of all or any part of the Mortgaged Property. The right to
collect rents, issues and profits herein provided shall not grant to Mortgagee
the right to possession, except as expressly herein provided; nor shall such
right impose upon Mortgagee the duty to produce rents, issues or profits or
maintain the Property in whole or in part. Possession of the
Mortgaged Property by a receiver appointed by a court of competent jurisdiction
shall not be considered possession of the Mortgaged Property by Mortgagee for
purposes hereof. Following the occurrence of an Event of Default that
is continuing, Mortgagee may in its sole discretion determine the order of
priority for application of any rents, issues and profits collected against the
costs of collection and any indebtedness secured by or obligations of Mortgagor
arising under the Loan Agreement and the other Loan Documents in accordance with
the terms of the Loan Agreement. Collection of any rents, issues and
profits by Mortgagee shall not cure or waive any Event of Default or notice of
Event of Default, or invalidate any acts done pursuant to such
notice.
(c) Mortgagor’s Authority to
Enter into Leases. Mortgagor shall not enter into any lease of
the Mortgaged Property, or any portion thereof, or modify or amend or supplement
any such lease, or extend any existing lease, without the prior written consent
of Mortgagee (which consent shall not be unreasonably withheld), except as
otherwise permitted in the Loan Agreement. Mortgagor shall, on
demand, execute such further assignments to Mortgagee of any or all leases,
agreements, rents, issues or profits of the Mortgaged Property as Mortgagee may
require in accordance with the terms of the Loan Agreement. Upon
request of Mortgagee, Mortgagor shall promptly deliver to Mortgagee a copy of
the fully executed original of any or all leases or agreements entered into
hereunder. All leases of the Mortgaged Property shall be subordinate
to this Mortgage unless Mortgagee elects in writing, at its sole option, to
subordinate this Mortgage to a particular lease or leases.
3.18 Impound
Account. Upon the happening of an Event of Default, and so
long as the Event of Default shall continue, at the request of Mortgagee,
Mortgagor shall pay to Mortgagee
27
each
month on the first day thereof an amount reasonably estimated by Mortgagee to be
equal to (a) the taxes and assessments payable under Section 1.03 and (b)
premiums next due for all insurance carried under Section 1.04, each such
estimate divided by the number of months to lapse preceding the month in which
it will become due and Mortgagor irrevocably grants and assigns to Mortgagee a
security interest in and to the amounts, if any, so paid by
Mortgagor. Such funds shall not be claimed to be held in trust and no
sums so paid shall bear interest, except to the extent of the minimum amount of
interest, if any, required by law; and Mortgagee shall, at its option, either
apply such funds to, or release such funds to Mortgagor for, payment of such
taxes and assessments and premiums. If the total amount retained in
the impound account exceeds the amount of payments actually applied by Mortgagee
as set forth above, such excess may be credited by Mortgagee on subsequent
payments to be made by Mortgagor hereunder or, at the option of Mortgagee,
refunded to Mortgagor; but if the security account shall not be sufficient to
pay the sums required at least thirty (30) days before the same are due and
payable, Mortgagor shall, within three (3) business days of receipt of written
demand therefore from Mortgagee, deposit with Mortgagee the full amount of any
such deficiency. Upon repayment of the amounts evidenced by the Term
Notes and the satisfaction of all other Secured Obligations of Mortgagor secured
hereby, any remaining funds held under this paragraph shall be released to
Mortgagor.
3.19 Conflicts. If
any provision hereof conflicts with the terms of the Loan Agreement, the terms
of the Loan Agreement shall be controlling.
3.20 Accommodation
Provisions. To the extent this Mortgage secures Obligations of
a party other than Mortgagor (an “Obligor”), Mortgagor
has executed and delivered this Mortgage as an accommodation instrument with the
intent of subjecting its interests in the Mortgaged Property to the lien of this
Mortgage as security for the Secured Obligations. Mortgagor hereby
agrees, to the fullest extent permitted by law, not to assert or take advantage
of:
(a) Any right
to require Mortgagee to proceed against any other Obligor, including as maker of
the Term Notes, or any other person or to proceed against or exhaust any other
security held by Mortgagee at any time or to pursue any other remedy in
Mortgagee’s power before exercising any right or remedy under this
Mortgage.
(b) Any
defense that may arise by reason of:
(i) Mortgagee’s
failure to proceed against any other Obligor’s property, or any other party
against whom Mortgagee might assert a claim, before proceeding against Mortgagor
under this Mortgage; or
(ii) The
release, suspension, discharge or impairment of any of Mortgagee’s rights
against any other Obligor or any other party against whom Mortgagee might assert
a claim, whether such release, suspension, discharge or impairment is explicit,
tacit or inadvertent; or
(iii) Mortgagee’s
failure to pursue any other remedies available to Mortgagee that would reduce
the burden of the indebtedness secured hereby on Mortgagor’s interests in the
Mortgaged Property; or
28
(iv) Any
extension of the time for the payment or performance of any of any other
Obligor’s obligations under the Term Notes, or any of the other Loan Documents;
or
(v) Any
amendment of this Mortgage, the Term Notes or any of the other Loan Documents,
whether or not such amendment materially affects the risk that Mortgagor has
assumed by executing this Mortgage; or
(vi) The
incapacity or lack of authority of any other Obligor or any person or persons;
or
(vii) The
failure of Mortgagee to file or enforce a claim against the estate (in either
administration, bankruptcy or any other proceedings) of any partner of any other
Obligor or any other person or persons.
(c) Demand,
protest and notice of any kind, including, without limitation, the following
notices:
(i) Notice of
the evidence, creation or incurring of any new or additional indebtedness or
obligation (provided that such indebtedness or obligation is not secured by this
Mortgage); or
(ii) Notice of
any action or non-action on the part of any other Obligor or Mortgagee in
connection with any obligation or evidence of indebtedness held by Mortgagee as
collateral; or
(iii) Notice of
payment or non-payment by any other Obligor of the indebtedness secured by this
Mortgage.
(d) Any right
to assert against Mortgagee any defense arising by reason of any claim or
defense based upon an election of remedies by Mortgagee to foreclose, either by
judicial foreclosure or by exercise of the power of sale, this Mortgage, which
in any manner impairs, reduces, releases, destroys or extinguishes Mortgagor’s
subrogation rights, rights to proceed against any other Obligor for
reimbursement, or any other rights of Mortgagor to proceed against any other
person or security. Mortgagor waives all rights and defenses to
enforcement of all or any part of the indebtedness secured hereby which defenses
are based on an election of remedies by Mortgagee, even though the election of
remedies, such as nonjudicial foreclosure with respect to this Mortgage, may
destroy Mortgagor’s rights of subrogation and reimbursement against any other
Obligor. Mortgagor makes this waiver with full knowledge that if
Mortgagee (i) waives a deficiency judgment in a judicial foreclosure, or (ii)
exercises the power of sale under this Mortgage, any action by Mortgagor against
any other Obligor to obtain reimbursement of any amount paid by Mortgagor
hereunder may be barred by reason of (x) Mortgagee’s waiver of such deficiency
in a judicial foreclosure or (y) Mortgagee’s exercise of such power of
sale. Mortgagor understands that absent the waiver set forth herein,
Mortgagor may have a defense to its obligations hereunder with respect to a
deficiency following a nonjudicial foreclosure or a judicial foreclosure in
which the Mortgagee waived its right to a deficiency judgment against any other
Obligor and that by granting this waiver, Mortgagor is waiving this defense
which Mortgagor would have against Mortgagee.
29
(e) Any
rights arising because of Mortgagor’s payment or satisfaction of the
indebtedness secured hereby (i) against any other Obligor, by way of subrogation
to the rights of Mortgagee or otherwise, or (ii) against any other guarantor or
any other party obligated to pay any of the indebtedness secured hereby, by way
of contribution or reimbursement or otherwise, but only until the indebtedness
secured hereby is paid in full.
(f) Any duty
on the part of Mortgagee to disclose to Mortgagor any default under the Term
Notes or any other Loan Document.
(g) Any duty
on the part of Mortgagee to disclose to Mortgagor any facts Mortgagee may now
know or may hereafter know about any other Obligor or any successors in interest
(if any) regardless of whether Mortgagee (i) has reason to believe that any such
facts materially increase the risk beyond the risk which Mortgagor intends to
assume by executing this Mortgage, (ii) has reason to believe that these facts
are unknown to Mortgagor, or (iii) has a reasonable opportunity to communicate
such facts to Mortgagor, it being understood and agreed that Mortgagor is fully
responsible for being and keeping informed of the financial condition of any
other Obligor or any successor in interest of any other Obligor and of all
circumstances bearing on the risk of non-payment of any indebtedness of any
other Obligor to Mortgagee that is secured hereby.
(h) Any right
to object to the release of any portions of the Mortgaged Property from the lien
of this Mortgage notwithstanding the fact that such releases may be made without
Mortgagee having received any or adequate consideration therefor.
Mortgagor
further agrees that with respect to any obligation secured hereby Mortgagee may,
in such manner and upon such terms and at such times as Mortgagee deems best and
without demand or notice to or consent of Mortgagor (i) release any party now or
hereafter liable for the performance of any such obligation, (ii) extend the
time for the performance of any such obligation, (iii) accept additional
security therefor, and (iv) alter, substitute or release any property securing
such performance.
Before
executing this Mortgage, Mortgagor has made such independent legal and factual
inquiries and investigations as Mortgagor deemed necessary or desirable with
respect to the ability of any other Obligor to honor all of any other Obligor’s
covenants and agreements with Mortgagee, and Mortgagor has relied solely on said
independent inquiries and investigations preparatory to entering into this
Mortgage.
Mortgagor
agrees that Mortgagee may enforce this Mortgage without the necessity of
resorting to or exhausting any security or collateral securing the Secured
Obligations, without the necessity of proceeding against any guarantor, and
without the necessity of proceeding against any other
Obligor. Mortgagor hereby waives the right to require Mortgagee to
proceed against any other Obligor, to foreclose any lien on any real or personal
property securing the Secured Obligations, to exercise any right or remedy under
the Loan Documents, to pursue any other remedy or to enforce any other
right.
Notwithstanding
any modification, discharge or extension of the Secured Obligations or any
amendment, modification, stay or cure of Mortgagee’s rights which may occur in
any
30
bankruptcy
or reorganization case or proceeding concerning any other Obligor, whether
permanent or temporary, and whether assented to by Mortgagee, Mortgagor hereby
agrees that it shall be obligated hereunder to pay and perform its obligations
in accordance with the terms of this Mortgage and the other Loan Documents in
effect on the date hereof. Mortgagor understands and acknowledges
that by virtue of this Mortgage, it has specifically assumed any and all risks
of a bankruptcy or reorganization case or proceeding with respect to any other
Obligor. Without in any way limiting the generality of the foregoing,
any subsequent modification of the Secured Obligations in any reorganization
case concerning any other Obligor shall not affect the obligation of Mortgagor
to perform its obligations hereunder and under the other Loan
Documents.
[No
Further Text on this Page; Signature Page Follows]
31
IN WITNESS WHEREOF, the
Mortgagor has caused this Mortgage to be executed by its duly authorized
___________________________ on the date of the acknowledgement of the
Mortgagor’s signature below.
CHEROKEE
NITROGEN HOLDINGS, INC., an Oklahoma corporation
By: _______________________
Name: _____________________
Title: _____________________
STATE
OF ______________)
COUNTY
OF ____________)
I, the
undersigned authority, a Notary Public in and for said County in said State,
hereby certify that __________________, whose name as ______________ of CHEROKEE
NITROGEN HOLDINGS, INC., an Oklahoma corporation, is signed to the foregoing
instrument, and who is known to me, acknowledged before me on this day that,
being informed of the contents of said instrument, he/she, as such officer and
with full authority, executed the same voluntarily for and as the act of said
corporation.
Notary
Public _______________________
My
Commission Expires
__________________________
32
EXHIBIT
A
LEGAL
DESCRIPTION
33
EXHIBIT
B
PERMITTED
ENCUMBRANCES
As
defined in the Loan Agreement including without limitation the
following:
[attach
pages showing permitted encumbrances under Alabama Title Policy]
34
EXHIBIT F-2
Xxx Xxxx,
Xxx Xxxx 00000-0000
After
recording please return to the above address, marked
to the
attention of: Xxxxxx Xxxxxxxxx
MORTGAGE,
ASSIGNMENT
OF RENTS AND SECURITY
AGREEMENT AND FIXTURE FILING STATEMENT
[ARKANSAS]
THIS MORTGAGE, ASSIGNMENT OF RENTS
AND SECURITY AGREEMENT AND FIXTURE FILING STATEMENT (this “Mortgage”), made as
of October __, 2007, between NORTHWEST FINANCIAL CORPORATION, an Oklahoma
corporation (hereinafter called the “Mortgagor”), whose
address is 00 X. Xxxxxxxxxxxx, Xxxxxxxx Xxxx, Xxxxxxxx 00000, and
Banc of America Leasing & Capital LLC, as collateral agent for the Lenders
(hereinafter called the “Mortgagee” or the
“Collateral
Agent”), whose address is c/o Xxxxxxxxx X. Xxxxxx, VP; Group Operations
Manager, Bank of America, MA5-100-32-01, 000 Xxxxxxx Xx., Xxxxxx, XX
00000.
W
I T N E S S E T H:
WHEREAS, upon the terms and
conditions of a certain Term Loan Agreement, dated as of the date hereof
(collectively, such agreement, as amended, restated, supplemented or otherwise
modified from time to time, being hereinafter referred to as the “Loan Agreement”), by
and among ThermaClime, Inc., an Oklahoma corporation (“ThermaClime”),
Cherokee Nitrogen Holdings, Inc., an Oklahoma corporation, Mortgagor, Chemex I
Corp., an Oklahoma corporation, Chemex II Corp, an Oklahoma corporation,
Cherokee Nitrogen Company, an Oklahoma corporation, ClimaCool Corp., an Oklahoma
corporation, ClimateCraft, Inc., an Oklahoma corporation, Climate Master, Inc.,
a Delaware corporation, DSN Corporation, an Oklahoma corporation, El Dorado
Chemical Company, an Oklahoma corporation, International Environmental
Corporation, an Oklahoma corporation, Koax Corp., an Oklahoma corporation, LSB
Chemical Corp., an Oklahoma corporation, The Climate Control Group, Inc., an
Oklahoma corporation, Trison Construction, Inc., an Oklahoma corporation,
ThermaClime Technologies, Inc., an Oklahoma corporation, and XpediAir, Inc., an
Oklahoma corporation, as borrowers (individually and collectively, jointly and
severally, “Borrower” or “Borrowers”), LSB
Industries, Inc., as guarantor, Banc of America Leasing & Capital, LLC, as
administrative agent (the “Administrative
Agent”), the Collateral Agent and the Lenders from time to time party
thereto (the “Lenders”;
collectively with the Administrative Agent and the Collateral Agent, the “Secured Parties”),
Secured Parties have agreed to provide certain financial accommodations to
Borrowers, upon the terms and conditions set forth in the Loan Agreement and the
other Loan Documents. Capitalized terms used but not defined herein
shall have the same meanings as such terms have in the Loan Agreement or, in the
case of capitalized terms used in the definition of “Mortgaged Property” below
and not defined in this Mortgage, the meanings ascribed to them in the Uniform
Commercial Code in effect in the State of Arkansas (the “UCC”). The
terms “El Dorado
Collateral” and/or “El Dorado Facility
Collateral” as defined in the Loan Agreement
shall
mean and refer to all Mortgaged Property and Collateral (as defined in Section
3.05 below) described in this Mortgage.
WHEREAS, Mortgagor is an
affiliate of ThermaClime and the other Borrowers and will receive substantial
direct and indirect benefits from the making of the Term Loans under the Loan
Agreement; and
WHEREAS, it is a condition
precedent to Lenders’ making the Term Loans that Mortgagor shall have executed
and delivered to Mortgagee this Mortgage and, as an accommodation to the
Borrowers and in consideration for, and in recognition of, the substantial
direct and indirect benefits Mortgagor will receive from the making of the Term
Loans under the Loan Agreement, Mortgagor has agreed to grant this Mortgage to
secure the full and punctual payment or performance when due (after applicable
grace periods), whether at stated maturity or earlier, including by reason of
acceleration, mandatory prepayment or otherwise in accordance with the Loan
Agreement or any other Loan Document, of the Term Loans and all the Obligations
under the Loan Documents, and any amendments or modifications to the same
(collectively, the “Secured
Obligations”), whether or not from time to time reduced or extinguished
or hereafter increased or incurred and whether enforceable or unenforceable as
against the Borrowers, or any one or more of them, now or hereafter existing, or
due or to become due, including principal, interest (including interest at the
contract rate applicable upon default accrued or accruing after the commencement
of any proceeding under the Bankruptcy Code, whether or not such interest is an
allowed claim in such proceeding), fees and costs of collection.
NOW, THEREFORE, the
undersigned, in consideration of all matters as set forth above and as more
particularly described in the Loan Agreement and the other Loan Documents, and
to secure the prompt payment and performance of all Secured Obligations, and any
extensions or renewals of same, and further to secure all other indebtedness,
fees, premiums (if any), charges, and expenses from time to time owing to
Mortgagee pursuant to this Mortgage, the Loan Agreement and the other Loan
Documents, and further to secure the performance of the covenants, conditions,
and agreements as set forth in any other documents executed in connection
herewith and as hereinafter set forth, has bargained and sold and does hereby
mortgage, grant, bargain, sell, assign, and convey unto the Mortgagee for the
ratable benefit of the Secured Parties, their successors and assigns, and hereby
grants to the Mortgagee for the ratable benefit of the Secured Parties, their
successors and assigns, subject to the Permitted Encumbrances defined in Section 1.02
herein below, a security interest in all of Mortgagor’s present and future
right, title and interest in, to and under the following described Land and
Improvements and any and all right, title or interest in any other real property
interests or improvements comprised in such real property, whether such right,
title or interest is acquired by Mortgagor after the date of this Mortgage, the
Equipment, and all right, title and interest of Mortgagor, if any, in and to all
personal property, and intangible personal property described below owned by
Mortgagor and used in connection with the operation of the business of Mortgagor
conducted on the Land (as defined below) (which together with any additional
such property hereafter acquired by the Mortgagor and subject to the lien of
this Mortgage, as the same may be from time to time constituted (and subject to
the limitations set forth in clause (c) below) is hereinafter sometimes referred
to as the “Mortgaged
Property”) to-wit:
2
(a) All
the tract(s) or parcel(s) of land particularly described in Exhibit A
attached hereto and made a part hereof (the “Land”).
(b) All
buildings, structures, and improvements of every nature whatsoever now or
hereafter situated on the Land (the “Improvements”), and
all fixtures, machinery, equipment and personal property of every nature
whatsoever now or hereafter owned by the Mortgagor and attached to, located in
or on, or used in connection with the operation of said Improvements, the
Chemico east/west weak nitric plant, the Chemico sulfuric acid plant, the
Chemico E2 high-density ammonium nitrate xxxxx plant, the K-T lo-density
ammonium nitrate xxxxx plant, a 100 TPD mixed acids plant, the X.X. Xxxxxxxxx
nitric acid plant, the XXXX 285 TPD direct strong nitric acid processing plant,
the CB&I tank farm including ammonia storage spheres, a refrigerated ammonia
tank and ammonia storage tanks, a plant steam generation system including
Xxxxxxx & Xxxxxx processing boilers, a plant electrical generation system
including substations and transformers, a wastewater ph neutralization
system, a pollution control and irrigation system, cooling towers,
air compressors, transformers, substations, storage tanks, office furniture,
computers and software, vehicles and forklift trucks (other than rolling stock
or titled vehicles), process plant piping, pumps and wiring, and including all
extensions, additions, improvements, betterments, renewals and replacements to
any of the foregoing.
(c) All
tangible personal property of every kind or character now owned or hereafter
acquired by the Mortgagor used in connection with the leasing, development, use
or operation of the Land and Improvements, whether or not subsequently removed
from the Land and the Improvements (collectively, the “Equipment”),
including, without limitation, chemical processing equipment, office equipment,
maintenance and machine shop equipment and laboratory equipment, but excluding
rolling stock and titled vehicles.
(d) All
building materials, equipment, fixtures, fittings, timber to be cut, minerals as
extracted (as such term is used in the Arkansas Uniform Commercial Code) and
personal property of every kind or character now owned or hereafter acquired by
the Mortgagor used in connection with the operation of the Improvements located
or to be located on the Land, whether such materials, equipment, fixtures,
fittings, and personal property are actually located on or adjacent to said
property or not, and whether in storage or otherwise, wheresoever the same may
be located, including, but without limitation, all lumber and lumber products,
bricks, building stones, and building blocks, sand and cement, roofing material,
paint, doors, windows, hardware, nails, wires and wiring, plumbing and plumbing
fixtures, heating and air conditioning equipment and appliances, electrical and
gas equipment and appliances, pipes and piping and in general all building
materials and equipment of every kind and character used in connection with the
operation of said Improvements.
(e) All
goodwill, trademarks, trade names, option rights, purchase contracts, books and
records, insurance return premiums and General Intangibles now owned or
hereafter acquired by Mortgagor relating to the Land, the Improvements or the
Equipment.
(f) All
agreements, ground leases, grants of easements or rights-of-way, permits,
declarations of covenants, conditions and restrictions, disposition and
development agreements, planned unit development agreements, cooperative,
condominium or similar
3
ownership
or conversion plans, management, leasing, brokerage or parking agreements or
other material documents affecting the Land (the “Property
Documents”);
(g) all
proceeds of and all unearned premiums on an insurance policies relating to the
Mortgaged Property (the “Insurance
Proceeds”);
(h) all
rights under all agreements with any provider of goods or services of or in
connection with any construction undertaken or to be undertaken on, or services
performed or to be performed in connection with, and all licenses, certificates
of occupancy, permits, warranty agreements and other agreements (including
supply, processing, terminalling or warehousing agreements and any environmental
remediation agreements) used in or necessary to the use or operation of, the
Land or the Improvements and conduct of the Facility Business (as defined in the
Loan Agreement) thereon, therein and therefrom, including without limitation all
Material Contracts (all of the foregoing are collectively referred to herein as
the “Operating
Contracts”);
(i) all
books, records and other information, wherever located, which are in Mortgagor’s
possession, custody or control or to which Mortgagor is entitled at law or in
equity and which are related to the Mortgaged Property, including all Software
and all computer hardware or other equipment used to record, store, manage,
manipulate or access the information; and
(j) all
after-acquired title to or remainder or reversion in any of the property
described in this Section; all proceeds, replacements, substitutions, products,
accessions and increases of or for the Mortgaged Property, all additions,
accessions and extensions to, improvements of or for the Mortgaged Property; and
all additional lands, estates, interests, rights or other property described
above acquired by Mortgagor after the date of this Mortgage for use in
connection with the operation of the Land or the Improvements, all without the
need for any additional mortgage, assignment, pledge or conveyance to Mortgagee
but Mortgagor will execute and deliver to Mortgagee, upon Mortgagee’s request,
any documents reasonably requested by Mortgagee to further evidence the
foregoing.
(k) Proceeds
and products of all of the foregoing real and personal property, tangible and
intangible.
To the
fullest extent permitted by applicable law, all of the foregoing shall be deemed
a part of the real property and at the option of Mortgagee, may be foreclosed
upon and sold upon an Event of Default in accordance with the laws relating to
mortgages of real estate.
TOGETHER with all easements,
rights of way, including any rights of ingress and egress, gores of land,
streets, sidewalks, ways, alleys, passages, sewer rights, waters, water courses,
water rights and powers, air rights and development rights, oil and mineral
rights (excepting only those rights previously conveyed or excluded as shown in
the Permitted Encumbrances) and all estates, rights, titles, interests,
privileges, liberties, tenements, hereditaments, and appurtenances whatsoever,
in any way belonging, relating or appertaining to any of the property
hereinabove described, or which hereafter shall in any way belong, relate or be
appurtenant thereto, whether now owned or hereafter acquired by the Mortgagor,
and the reversion and reversions, remainder and remainders, rents, issues, and
profits thereof, and all the
4
estate,
right, title, interest, property, possession, claim, and demand whatsoever at
law, as well as in equity, of the Mortgagor of, in and to the same, including
but not limited to:
(a) All
rents, profits, issues, and revenues of the Mortgaged Property (collectively,
the “Rents”)
from time to time accruing, whether under leases or tenancies now existing or
hereafter created, reserving to Mortgagor, however, so long as Mortgagor is not
in default hereunder, the right to receive and retain the rents, issues, and
profits thereof; and
(b) All
judgments, awards of damages, and settlements hereafter made resulting from
condemnation proceedings or the taking of the Mortgaged Property or any part
thereof under the power of eminent domain, or for any damage (whether caused by
such taking) to the Mortgaged Property or any part thereof, or to any rights
appurtenant thereto, including any award for change of grade or
streets. Mortgagee hereby is authorized on behalf and in the name of
Mortgagor to execute and deliver valid acquittances for, and appeal from, any
such judgments or awards. Such sums or any part thereof so received
shall be applied in accordance with the provisions of Section 1.06
hereof.
The
Mortgaged Property does not include the Excluded Assets (as defined in the Loan
Agreement), notwithstanding any provision set forth above seemingly to the
contrary.
TO HAVE AND TO HOLD the
Mortgaged Property and all parts thereof unto the Mortgagee, its successors and
assigns forever, subject however to the terms and conditions
herein:
TO
SECURE unto Mortgagee: (a) the payment and performance of all Secured
Obligations, payable according to the terms stated therein; (b) the payment of
all other sums, with interest thereon, advanced in accordance herewith to
protect the security of this Mortgage; (c) the faithful payment and performance
of the covenants and agreements of Mortgagor contained herein and the faithful
payment and performance of the covenants and agreements of the Borrowers in the
Loan Agreement and the other Loan Documents;
PROVIDED, HOWEVER, that these
presents are upon the condition that, if full payment and performance of all
Secured Obligations, including the Term Notes and the full payment and
performance of the Loan Agreement and the other Loan Documents is achieved, at
the times and in the manner stipulated therein and herein, all without any
deduction or credit for taxes or other similar charges paid by the Mortgagor,
and the Borrowers shall keep, perform, and observe all and singular the
covenants and promises in the Loan Agreement and the other Loan Documents and
Mortgagor shall keep, perform, and observe all and singular the covenants and
promises in this Mortgage expressed to be kept, performed, and observed by and
on the part of the Mortgagor, all without fraud or delay (but within any
applicable cure period), and there shall be no other uncured Event of Default
under any of the Loan Agreement and the other Loan Documents, then this
Mortgage, and all the properties, interest, and rights hereby granted,
bargained, and sold shall cease, determine, and be void.
AND the Mortgagor covenants
and agrees with the Mortgagee as follows:
5
ARTICLE
I
1.01 Performance of Mortgage,
Loan Agreement and other Loan Documents. The Mortgagor will
perform, observe and comply with all provisions hereof, and the Borrowers will
perform, observe and comply with all provisions of the Loan Agreement and the
other Loan Documents and duly and punctually will pay and perform all Secured
Obligations with interest thereon and all other sums required to be paid by them
pursuant to the Loan Agreement and the other Loan Documents executed in
connection herewith, all without any deductions or credit for taxes or other
similar charges paid by the Mortgagor or the Borrowers.
1.02 Warranty of
Title. The Mortgagor is lawfully seized of an indefeasible
estate in fee simple in the Land, Improvements and other real property hereby
mortgaged and has good and marketable title to all existing personal property
hereby mortgaged and has good right, full power and lawful authority to sell,
convey and mortgage the same in the manner and form aforesaid, and that, except
for the permitted liens described in Exhibit B attached
hereto and as described in Section 7.01 of the Loan Agreement (the “Permitted
Encumbrances”), the same is free and clear of all liens, charges, and
encumbrances whatsoever, including, as to the personal property and fixtures,
conditional sales contracts, chattel mortgages, security agreements, financing
statements, and anything of a similar nature, and that Mortgagor shall and will
warrant and forever defend the title thereto unto the Mortgagee, its successors
and assigns, against the lawful claims of all persons whomsoever.
1.03 Other Taxes, Utilities and
Liens.
(a) The
Mortgagor will pay promptly, before the same becomes delinquent and after giving
effect to any extensions validly existing under applicable law, and. promptly
after request therefor by Mortgagee, will exhibit promptly to the Mortgagee
receipts for the payment of, all taxes, assessments, water rates, dues, charges,
fines and impositions of every nature whatsoever imposed, levied or assessed or
to be imposed, levied or assessed upon or against the Mortgaged Property or any
part thereof, or upon the interest of the Mortgagee in the Mortgaged Property,
this Mortgage, the Loan Agreement or the other Loan Documents, as well as all
income taxes, assessments and other governmental charges lawfully levied and
imposed by the United States of America or any state, county, municipality,
borough or other taxing authority upon the Mortgagor or in respect of the
Mortgaged Property or any part thereof, or any charge which, if unpaid, would
become a lien or charge upon the Mortgaged Property; provided, however, that
Mortgagor will not be required to pay any tax fee, assessment, governmental
charge or any other obligations that is being contested in good faith by
appropriate actions or proceedings diligently pursued and for which adequate
reserves with respect thereto have been established in conformity with the
provisions of the Loan Agreement.
(b) The
Mortgagor will pay promptly all charges by utility companies, whether public or
private, for electricity, gas, water, sewer, or other utilities.
(c) The
Mortgagor shall pay promptly all charges for labor and materials and will not
suffer any mechanic’s, laborer’s, statutory, or other lien to be filed against
any of the Mortgaged Property, unless arrangements satisfactory to Mortgagee are
made with respect thereto or unless contested in good faith by appropriate
actions or proceedings diligently pursued
6
and for
which adequate reserves with respect thereto have been established in accordance
with the provisions of the Loan Agreement.
1.04 Insurance
Requirements.
(a) To keep
the Mortgaged Property and all other property, now or hereafter owned by
Mortgagor and located on the Mortgaged Property, constantly insured in the
amounts, with the coverages and under such policies and other terms and
conditions as are set forth in the Loan Agreement. All such insurance
shall be carried by companies authorized to insure in Arkansas which are
reasonably acceptable to Mortgagee, and all such policies shall include a
standard mortgagee’s endorsement and loss payable clause in favor of and in form
reasonably acceptable to Mortgagee as required by the Loan
Agreement. In the event of loss in the amount of $500,000 or more, Mortgagor shall
give prompt notice thereof to the Mortgagee, who is hereby authorized and
empowered to make proof of loss, if not made promptly by
Mortgagor. Each insurance company is hereby authorized and directed
to make payments for such loss directly to the Mortgagee instead of to the
Mortgagor and Mortgagee jointly, and the insurance proceeds, or any part
thereof, shall be advanced and applied in a manner consistent with the Loan
Agreement. Until the sums hereby secured are fully paid and
satisfied, Mortgagor shall not permit any insurance to expire, lapse or be
canceled unless in each instance Mortgagor acquires and delivers to the
Mortgagee new or replacement policies in accordance with the terms of the Loan
Agreement. In the event of a sale or foreclosure by the Mortgagee,
all title and interest of Mortgagor in and to such policies shall pass to the
purchaser at such sale.
(b) To
maintain general liability insurance against liability for injuries to or death
of any person or damage to or loss of property arising out of or in any way
relating to the condition of the Mortgaged Property or any part thereof, in
accordance with the terms of the Loan Agreement, for death or personal injury to
any one person, for all personal injuries and deaths resulting from any one
accident, and for property damage in any one accident, provided that the
requirements of this paragraph with respect to the amount of insurance may be
satisfied by an excess coverage policy.
(c) To
maintain insurance against such other casualties and contingencies as Mortgagee
required pursuant to Section 6.07 of the Loan Agreement.
1.05 Insurance
Policies. All insurance required hereunder shall be effective
under a valid and enforceable policy or policies issued by an insurer of
recognized responsibility approved by Mortgagee. All policies of
insurance required in Section 1.04
shall be written or endorsed in accordance with the provisions of the Loan
Agreement. These policies shall provide that all proceeds of such
insurance (except as provided in the following sentence) shall be payable to
Mortgagee pursuant to a standard mortgagee clause to be attached to each such
policy, but subject to the provisions of Section 1.04
above. So long as no uncured Event of Default then shall exist, the
proceeds of insurance covering the interruption of Mortgagor’s business, and the
revenues from operation of the business conducted from the Mortgaged Property
damaged by an insured casualty, may be paid directly to
Mortgagor. Mortgagor shall deposit with Mortgagee copies of policies
evidencing all such insurance, if so requested by Mortgagee, or a certificate or
certificates of the respective insurers stating that such insurance is in force
and effect. Mortgagor shall keep all policies of insurance constantly
assigned, pledged and delivered to the Mortgagee.
7
Mortgagor
shall pay or cause to be paid all premiums due with respect to the same and, if
so requested by Mortgagee, shall furnish to Mortgagee satisfactory proof of the
timely making of such payments in accordance with the provisions of the Loan
Agreement. Each policy of insurance herein required shall contain a
provision that the insurer shall not cancel, refuse to renew or materially
modify it without giving written notice to Mortgagee at least thirty (30) days
(or, in the case of cancellation due to non-payment, such shorter period as
mandated by state law, but in no event less than ten (10) days) before the
cancellation, non-renewal or modification becomes effective. At least
ten (10) Business Days before the expiration date of each expiring policy
promptly, Mortgagor shall furnish Mortgagee with evidence satisfactory to
Mortgagee that the policy has been renewed or replaced by another policy
conforming to the provisions of this Section or that there is no necessity
therefor under the terms hereof. In lieu of separate policies,
Mortgagor may maintain blanket policies having the coverage required herein, in
which event it shall deposit with Mortgagee a certificate or certificates of the
respective insurance as to the amount of coverage.
Notwithstanding
Mortgagee’s rights under Sections 1.04 and 1.05, Mortgagee will not be liable
for any loss, damage or injury resulting from the inadequacy or lack of any
insurance coverage.
If an
insured casualty occurs where (i) the loss is in an aggregate amount less
than the 20% of the outstanding principal balance of the Term Loan; (ii) in
the reasonable judgment of Mortgagee the Mortgaged Property can be restored
within one year, and prior to one year before the Maturity Date and prior to the
expiration of the rental or business interruption insurance with respect
thereto, to the Mortgaged Property’s pre-existing condition and utility as
existed immediately prior to such insured casualty and to an economic unit not
less valuable and not less useful than the same was immediately prior to the
insured casualty; and (iii) no Default or Event of Default shall have
occurred and be then continuing, then the insurance proceeds (after
reimbursement to Mortgagee of any expenses incurred by Mortgagee in collecting
such proceeds), shall be applied to reimburse Mortgagor for the cost of
restoring, repairing, replacing or rebuilding the Mortgaged Property (the “Restoration”),
in the manner set forth herein. Mortgagor shall commence and
diligently prosecute such Restoration. Notwithstanding the foregoing,
in no event shall Mortgagee be obligated to apply the proceeds to reimburse
Mortgagor for the cost of Restoration unless, in addition to satisfaction of the
foregoing conditions, Mortgagor shall pay (and if required by Mortgagee,
Mortgagor shall deposit with Mortgagee in advance) all costs of such Restoration
in excess of the net amount of the proceeds made available pursuant to the terms
hereof.
Except as
provided in the immediately preceding paragraph, after deducting the costs
incurred by Mortgagee in collecting the proceeds of any insurance, Mortgagee
may, in its sole discretion, (i) apply such proceeds as a credit against any
portion of the Secured Obligations selected by Mortgagee in its sole discretion;
(ii) apply the proceeds to restore the Improvements, provided that Mortgagee
will not be obligated to see to the proper application of the proceeds and
provided, further, that any amounts released for restoration will not be deemed
a payment on the Secured Obligations; or (iii) deliver the proceeds to
Mortgagor.
If
Mortgagor is entitled to insurance proceeds held by Mortgagee, such proceeds
shall be disbursed upon Mortgagee being furnished with (i) evidence
satisfactory to Mortgagee of the
8
estimated
cost of completion of the Restoration, (ii) evidence reasonably
satisfactory to Mortgagee of the availability of all funds in addition to the
proceeds that in Mortgagee’s judgment are required to complete the proposed
Restoration (which availability may be evidenced by the deposit of such
additional funds with Mortgagee, a letter of credit in the amount of such
additional required funds, or other evidence reasonably satisfactory to
Mortgagee as agreed with Mortgagor at the time of such event); and (iii) if
appropriate in connection with the nature of the casualty, plans and
specifications or other reasonably detailed description of Mortgagor’s plans to
accomplish such Restoration (the “Plans”), such Plans to be approved by
Mortgagee for casualties where the loss is in an aggregate amount of
$2,000,000.00 or more, prior to disbursement of any proceeds, which approval
shall not unreasonably be withheld or delayed. In the event that the
Restoration is for a loss in an aggregate amount less than $2,000,000, Mortgagor
may proceed with such Restoration without prior approval of Plans therefor so
long as Mortgagor shall certify to Mortgagee prior to disbursement of any
proceeds that such Restoration complies with the other requirements of this
Section 1.05 concerning Restoration, and if requested by Mortgagee provides to
Mortgagee the Plans for such Restoration. Mortgagee shall review
Plans for a Restoration as promptly as commercially practicable after receipt of
such Plans from Mortgagor. At all times, the insurance proceeds (or,
after application of a portion of such proceeds, the undisbursed balance of such
proceeds remaining in the hands of Mortgagee), together with funds to be made
available by Mortgagor for that purpose to the satisfaction of Mortgagee, shall
be at least sufficient in the reasonable judgment of Mortgagee to pay for the
cost of completion of the Restoration, free and clear of all Liens or claims for
Lien. Provided no Event of Default then exists, any surplus that
remains out of the Proceeds held by Mortgagee after payment of such costs of
Restoration shall be paid to Mortgagor. Any surplus that remains out
of the Award received by Mortgagee after payment of such costs of Restoration
shall, in the discretion of Mortgagee, be retained by Mortgagee and applied to
payment of the Debt or returned to Mortgagor. Notwithstanding
anything set forth in this Section 1.05 to the
contrary, the conditions set forth in this Section 1.05 relate
solely to the application of proceeds of insurance covering an insured casualty,
and shall not prevent, and Mortgagor may, proceed with Restoration immediately
after any casualty without prior consent or approval by Mortgagee, subject to
compliance with the requirements for restoration and maintenance of the
Mortgaged Property set forth in Section 1.07 (“Care of the
Property”) of this Mortgage and Section 6.06 (“Maintenance of Properties;
Collateral”) of the Loan Agreement.
1.06 Condemnation. If
all or any part of the Mortgaged Property shall be damaged or taken through
condemnation (which term when used in this Mortgage shall include any damage or
taking by any governmental authority, and any transfer by private sale in lieu
thereof), either temporarily or permanently, the Secured Obligations shall
continue until satisfied in full or earlier terminated in accordance with the
Loan Agreement. The Mortgagee shall be entitled to all compensation,
awards, and other payments or relief therefor and is hereby authorized, at its
option, to commence, appear in and prosecute, in its own or the Mortgagor’s
name, any action or proceedings relating to any condemnation, and to settle or
compromise any claim in connection therewith. All such compensation,
awards, damages, claims, rights of action and proceeds and the right thereto are
hereby assigned by the Mortgagor to the Mortgagee, and Mortgagor shall, upon
request of Mortgagee, make, execute, acknowledge and deliver any and all
additional assignments and documents as may be necessary from time to time to
enable Mortgagee to collect and receipt for any such sums. Mortgagee
shall not be, under any circumstances, liable or responsible for failure to
collect, or exercise diligence in the collection of, any of such
sums.
9
Any sums
so collected shall be applied by Mortgagee, first, to the expenses, if any, of
collection, and then in accordance with Section 2.06
hereof. Notwithstanding the foregoing, if, after such condemnation or
private sale in lieu thereof, the taking will not have a Material Adverse Effect
upon the continued operation of the Mortgaged Property and no Event of Default
has occurred and is continuing, upon request of Mortgagor, said sums so held by
Mortgagee shall be made available for such restoration and disbursed by
Mortgagee during the course of such restoration under safeguards reasonably
satisfactory to Mortgagee. Any sums remaining after completion of
restoration shall be applied in accordance with Section 2.06.
1.07 Care of the
Property.
(a) The
Mortgagor will preserve and maintain the Mortgaged Property in such condition
and repair as is provided in the Loan Agreement, and will not commit or suffer
any waste and will not do or suffer to be done anything which will increase the
risk of fire or other hazard to the Mortgaged Property or any part thereof, and
which is materially inconsistent with the manner Mortgagor currently operates
the Mortgaged Property.
(b) Except as
otherwise provided herein or in the Loan Agreement or other Loan Documents, no
buildings, fixtures, personal property, or other part of the Mortgaged Property
shall be removed, demolished or substantially altered without the prior written
consent of the Mortgagee, (which consent shall not be unreasonably withheld),
except for improvements to, replacements of, additions to, substitutions of, and
removal or demolition of obsolete or unused facilities (“Permitted
Alterations”) provided such Permitted Alterations do not interfere with
the normal operation of the Mortgaged Property and do not cause any diminution
in its value.
(c) If the
Mortgaged Property or any material part thereof is substantially damaged by fire
or any other cause, the Mortgagor will give prompt written notice of the same to
the Mortgagee.
(d) The
Mortgagee is hereby authorized to reasonable access to enter upon and inspect
the Mortgaged Property at any time during normal business hours upon reasonable
written notice.
(e) The
Mortgagor will comply with all present and future laws, ordinances, judgments,
decrees, injunctions, writs and orders of any court, arbitrator or governmental
agency or authority, and all rules, regulations, orders, interpretations,
directives, licenses and permits, applicable to the Mortgaged Property, and all
covenants, restrictions and conditions now or later of record which may be
applicable to any of the Mortgaged Property, or to the use, manner of use,
occupancy, possession, operation, maintenance, alteration, repair or
reconstruction of any of the Mortgaged Property, except where failure to do so
could not reasonably be expected to have a Material Adverse Effect (considered
both individually and together with other such failures) on (i) the current
business, operations or condition (financial or otherwise) of the Borrowers and
their Subsidiaries taken as a whole, (ii) the current use of the Mortgaged
Property, or (iii) the value of the Mortgaged Property (assuming its current
use); provided, however, that Mortgagor may contest or dispute any of the same
by appropriate action or proceedings diligently pursued,
10
if
adequate reserves with respect thereto have been established in accordance with
the provisions of the Loan Agreement.
(f) If all or
any part of the Mortgaged Property shall be damaged by fire or other casualty,
the Mortgagor will restore promptly the Mortgaged Property to the equivalent of
its original condition, regardless of whether or not there shall be any
insurance proceeds therefor; provided, however, if insurance proceeds are paid
in connection with such fire or other casualty, such obligation to restore the
Mortgaged Property is conditioned on Mortgagor’s receipt of insurance proceeds
and making such available to the Mortgagor in accordance with this Mortgage or
the Loan Agreement. If a part of the Mortgaged Property shall be
physically damaged through condemnation, the Mortgagor will restore promptly,
repair or alter the remaining property in a manner reasonably satisfactory to
the Mortgagee; provided, however such obligation to restore, repair or alter the
remaining properties is conditioned on Mortgagor’s receipt of any related
proceeds and making such available to the Mortgagor as set forth in Section 1.06,
above.
(g) Except as
expressly permitted in the Loan Agreement or other Loan Documents, the Mortgagor
shall not sell, transfer, convey or assign all or any portion of, or any
interest in, the Mortgaged Property, except for easements and other similar
grants or interests which do not materially adversely affect the value, use or
operation of the Land and the Improvements for the purposes then currently used
or contemplated, except as otherwise allowed by the Loan Agreement.
1.08 Further Assurances; After
Acquired Property. At any time, and from time to time, upon
request by the Mortgagee, the Mortgagor will make, execute and deliver or cause
to be made, executed and delivered, to the Mortgagee and, where appropriate, to
cause to be recorded and/or filed and from time to time thereafter to be
re-recorded and/or refiled at such time and in such offices and places as shall
be deemed reasonably desirable by the Mortgagee any and all such other and
further mortgages, instruments of further assurance, certificates, financing
statements and other documents as may, in the opinion of the Mortgagee, be
reasonably necessary or desirable in order to effectuate, complete, or perfect,
or to continue and preserve the obligation of the Mortgagor under this Mortgage,
and the lien and security interest of this Mortgage as a first and prior lien
and security interest upon all of the Mortgaged Property, whether now owned or
hereafter acquired by the Mortgagor. Upon any failure by the
Mortgagor so to do, the Mortgagee may make, execute, and record any and all such
mortgages, instruments, certificates, financing statements and documents for and
in the name of the Mortgagor and, the Mortgagor hereby irrevocably appoints the
Mortgagee the agent and attorney-in-fact of the Mortgagor so to
do. The lien hereof will automatically attach, without further act,
to all after acquired property attached to and/or used in the operation of the
Mortgaged Property or any part thereof.
1.09 Leases Affecting Mortgaged
Property. The Mortgagor will comply with and observe its
material obligations as landlord under all leases affecting the Mortgaged
Property or any part thereof. If requested by Mortgagee, Mortgagor
will furnish Mortgagee with executed copies of all leases now or hereafter
created with respect to all or any part of the Mortgaged Property; and all
leases now or hereafter entered into must be approved by Mortgagee in advance of
Mortgagor becoming obligated upon any such leases. Mortgagee hereby
acknowledges that
11
Mortgagee
has approved those leases in effect with respect to the Mortgaged Property as of
the date of execution of this Mortgage which have been previously provided or
made available by Mortgagor to Mortgagee for review. If requested by
the Mortgagee, the Mortgagor will execute one or more separate assignments to
the Mortgagee of any and all such leases, whether now existing or hereafter
created, and all rents, royalties, issues, and profits of the Mortgaged Property
from time to time accruing. Except as provided in the Loan Agreement,
Mortgagor will not cancel, surrender, or modify any lease without the written
consent of the Mortgagee.
1.10 Appraisals. At
the Mortgagee’s request, Mortgagor will permit the Mortgagee, or its agents,
employees or independent contractors, to reasonably enter upon and appraise the
Mortgaged Property at any time and from time to time, upon written notice to
Mortgagee, and Mortgagor will cooperate with and provide any information
requested in connection with such appraisals.
1.11 Expenses. In
accordance with the provisions of the Loan Agreement, the Mortgagor will pay or
reimburse the Mortgagee for all reasonable attorney’s fees, costs, and expenses
incurred by the Mortgagee in any proceeding involving the estate of a decedent
or an insolvent, or in any action, proceeding, or dispute of any kind in which
the Mortgagee is made a party, or appears as party plaintiff or defendant,
affecting the Loan Agreement, the other Loan Documents, this Mortgage,
Mortgagor, or the Mortgaged Property, including but not limited to the
foreclosure of this Mortgage, any condemnation action involving the Mortgaged
Property, or any action to protect the security hereof; and any such amounts
paid by the Mortgagee shall bear interest at the rate provided for in the Loan
Agreement, shall be payable upon demand, and shall be secured by the lien of
this Mortgage.
1.12 Performance by Mortgagee of
Defaults by Mortgagor. If the Mortgagor shall default in the
payment of any tax, lien, assessment, or charge levied or assessed against the
Mortgaged Property (other than if such is subject to a Permitted Protest); in
the payment of any utility charge, whether public or private; in the payment of
insurance premium; in the procurement of insurance coverage and the delivery of
the insurance policies required hereunder, or in the performance or observance
of any covenant, condition, or term of this Mortgage, then the Mortgagee, at its
option, may reasonably perform or observe the same, and all payments made for
costs or incurred by the Mortgagee in connection therewith, shall be secured
hereby and shall be, without demand, immediately repaid by the Mortgagor to the
Mortgagee with thereon at the rate provided for in the Loan
Agreement. The Mortgagee shall be the sole judge of the legality,
validity and priority of any such tax, lien, assessment, charge, claim and
premium; of the necessity for any such actions and of the amount necessary to be
paid in satisfaction thereof. The Mortgagee is hereby empowered to
enter and to authorize others to enter upon the Mortgaged Property or any part
thereof for the purpose of performing or observing any such defaulted covenant,
condition or term, without thereby becoming liable to the Mortgagor or any
person in possession holding under the Mortgagor.
1.13 Books and
Records. The Mortgagor shall keep and maintain at all times
full, true and accurate books of accounts and records, adequate to reflect
correctly the results of the operation of the Mortgaged Property. The
Mortgagor will furnish to the Mortgagee with such financial information and
reports as and when provided in the Loan Agreement.
12
ARTICLE
II
2.01 Event of
Default. The term “Event of Default,”
wherever used in the Mortgage, shall mean any one or more of the following
events:
(a) The
occurrence of an uncured Event of Default under the Loan
Agreement..
(b) If
Mortgagor shall be in default under any other deed of trust, mortgage or
security agreement covering any material part of the Mortgaged Property, whether
it be superior or junior in lien to this Mortgage, following expiration of any
grace periods therein; provided, however, that Mortgagor may contest or dispute
any of the same by appropriate action or proceeding diligently pursued, if
permitted in the Loan Agreement and adequate reserves with respect thereto have
been established in accordance with the provisions of the Loan
Agreement.
(c) Except as
permitted in this Mortgage or the Loan Agreement, the material alteration,
improvement, demolition or removal of any of the Improvements located on the
Mortgaged Property without the prior consent of Mortgagee.
(d) Except as
permitted in this Mortgage or the Loan Agreement, the Mortgaged Property or any
material part thereof shall be taken on execution or other process of law in any
action against Mortgagor and there shall be a period of thirty (30) consecutive
days during which a stay of enforcement of such judgment or order, by reason of
a pending appeal or otherwise, shall not be in effect.
(e) Except as
permitted in this Mortgage or the Loan Agreement, the Mortgagor abandons all or
a portion of the Mortgaged Property.
(f) Except as
permitted in this Mortgage or the Loan Agreement, the Mortgaged Property, or any
part thereof, is subjected to waste or to removal, demolition or material
alteration so that the value of the Mortgaged Property is materially diminished
thereby and Mortgagee determines (in its subjective determination) that it is
not adequately protected from any loss, damage or risk associated
therewith.
(g) Notwithstanding
anything herein, any requirement of notice specified above shall be deemed
deleted if Mortgagee is prevented from giving notice by bankruptcy or other
applicable law, and the cure period shall be measured from the date of the event
or failure rather than from the date of notice. Nothing herein shall
require notice except where expressly set forth in this Mortgage or the Loan
Agreement.
2.02 Acceleration of
Maturity. If an Event of Default shall have occurred and is
continuing, then the Secured Obligations and performance thereunder, secured
hereby with interest accrued thereon shall, at the option of the Mortgagee,
become immediately due and payable without notice or demand, time being of the
essence; and any omission on the part of the Mortgagee to exercise such option
when entitled to do so shall not be considered as a waiver of such
right.
2.03 Right of Mortgagee to Enter
and Take Possession.
13
(a) If an
Event of Default shall have occurred and be continuing, the Mortgagor, upon
demand of the Mortgagee, shall forthwith surrender to the Mortgagee the actual
possession, and if and to the extent permitted by law, the Mortgagee may enter
and take possession, of all the Mortgaged Property, and may exclude the
Mortgagor and its agents and employees wholly therefrom.
(b) Upon
every such entering upon or taking of possession, the Mortgagee may hold, store,
use, operate, manage, and control the Mortgaged Property and conduct the
business thereof, and, from time to time (i) make all necessary and proper
maintenance, repairs, renewals, replacements, additions, betterments, and
improvements thereto and thereon and purchase or otherwise acquire additional
fixtures, personalty, and other property; (ii) insure or keep the Mortgaged
Property insured; (iii) manage and operate the Mortgaged Property and exercise
all the rights and powers of the Mortgagor in Mortgagor’s name or otherwise,
with respect to the same; (iv) enter into any and all agreements with respect to
the exercise by others of any of the powers herein granted the Mortgagee, all as
the Mortgagee from time to time may determine to be to its best advantage; and
the Mortgagee may collect and receive all the income, revenues, rents, issues
and profits of the same including those past due as well as those accruing
thereafter, and, after deducting (A) all expenses of taking, holding, managing,
and operating the Mortgaged Property (including compensation for the services of
all persons employed for such purposes); (B) the cost of all such maintenance,
repairs, renewals, replacements, additions, betterments, improvements,
purchases, and acquisitions; (C) the cost of such insurance; (D) such taxes,
assessments, and other charges prior to the lien of this Mortgage as the
Mortgagee may determine to pay; (E) other proper charges upon the Mortgaged
Property or any part thereof; and (F) the reasonable compensation, expenses, and
disbursements of the attorneys and agents of the Mortgagee; shall apply the
remainder of the moneys so received by the Mortgagee to the payment of accrued
interest, to the payment of tax and insurance deposits required to pay for the
taxes and insurance policies described in Sections 1.03 and
1.04 hereof,
and to the sums hereby secured, or otherwise in payment of a portion of the
Secured Obligations, all in such order and priority as expressly set forth in
the Loan Agreement or, if not so provided, as the Mortgagee may
determine.
(c) Whenever
all such Events of Default have been cured and satisfied, the Mortgagee shall
surrender possession of the Mortgaged Property to the Mortgagor, its successors
or assigns. The same right of taking possession, however, shall exist
if any subsequent Event of Default shall occur and be continuing.
2.04 Receiver.
(a) If an
Event of Default shall have occurred and is continuing, the Mortgagee, upon
application to a court of competent jurisdiction, shall be entitled, without
notice and without regard to the adequacy of any security for the Secured
Obligations hereby secured or the solvency of any party bound for its payment,
to the appointment of a receiver to take possession of and to operate the
Mortgaged Property and to collect the rents, profits, issues, and revenues
thereof.
(b) The
Mortgagor will pay to the Mortgagee upon demand all expenses, including
receiver’s fees, attorney’s fees and costs, and agent’s compensation, incurred
pursuant
14
to the
provisions contained in this Section; and all such expenses shall be secured by
this Mortgage.
2.05 Mortgagee’s Power of
Enforcement. If an Event of Default shall have occurred and is
continuing, the Mortgagee may, either with or without entry or taking possession
as hereinabove provided or otherwise, proceed by suit or suits at law or in
equity or any other appropriate proceeding or remedy (a) to enforce payment and
performance of all Secured Obligations (b) to foreclose this Mortgage and to
sell, as an entirety or, at the option of Mortgagee, in separate lots or
parcels, the Mortgaged Property, and (c) to pursue any other remedy available to
it, all as the Mortgagee shall deem most effectual for such
purposes. The Mortgagee shall take action either by such proceedings
or by the exercise of its powers with respect to entry or taking possession, as
the Mortgagee may determine.
2.06 Power of
Sale. If an Event of Default shall have occurred and is
continuing, Mortgagee may, under the power of sale herein granted to Mortgagee,
take possession of the Mortgaged Property and sell all or part of the Mortgaged
Property, at public auction, to the highest bidder for cash, free from equity of
redemption, any statutory or common law right of redemption, homestead, dower,
and all other rights and exemptions of every kind, all of which are hereby
expressly waived, at the front door of any courthouse or other building in the
county where any of the Mortgaged Property is situated, according to the laws of
the State of Arkansas. The owners of any part of the indebtedness
hereby secured may become the purchaser at any sale under this
conveyance. The Mortgagee shall execute and deliver a deed of
conveyance to the purchaser, and all statements of fact in such deed relating to
the nonpayment of the indebtedness hereby secured, the existence of the
indebtedness, notices of advertisement, sale, receipt of money and appointment
of substituted Mortgagee shall be prima facie evidence of the truth of such
statements. Mortgagee making such sale shall receive the proceeds
thereof and shall apply the same as follows: (i) first, to the payment of the
expenses of making, maintaining and executing this Mortgage, protection of the
Mortgaged Property, including the expense of any litigation and reasonable
attorneys’ fees; (ii) second, to any advancements made by the Mortgagee pursuant
hereto, with interest thereon; (iii) third, to the payment of the Secured
Obligations herein secured or intended so to be, in such order as Mortgagee
shall elect, and any balance of said Secured Obligations may be the subject of
immediate suit; (iv) and, fourth, should there be any surplus, Mortgagee will
pay it to the Mortgagor, or to such person as may be legally entitled
thereto.
2.07 Waiver. Mortgagor
hereby waives any and all rights of dower, courtesy, appraisement, sale,
redemption and homestead under the laws of the State of Arkansas and especially
under Act 153 of May 8, 1899, and acts amendatory thereof.
2.08 Mortgagee’s Option on
Foreclosure. If an Event of Default shall have occurred and is
continuing, at the option of the Mortgagee, this Mortgage may be foreclosed as
provided by law or in equity, in which event a reasonable attorney’s fee shall,
among other costs and expenses, be allowed and paid out of the proceeds of the
sale. In the event Mortgagee exercises its option to foreclose this
Mortgage in equity, Mortgagee may, at its option, and subject to any Permitted
Encumbrances, foreclose this Mortgage subject to the rights of any tenants of
the Mortgaged Property, and the failure to make any such tenants parties
defendants to any such foreclosure proceeding and to foreclose its rights will
not be, nor be asserted to be by the
15
Mortgagor,
a defense to any proceedings instituted by the Mortgagee to collect the sum
secured hereby, or any deficiency remaining unpaid after the foreclosure sale of
the Mortgaged Property.
2.09 Waiver of
Exemption. Mortgagor waives all rights of exemption pertaining
to real or personal property as to any indebtedness secured by or that may be
secured by this Mortgage, and Mortgagor waives the benefit of any statute
regulating the obtaining of a deficiency judgment or requiring that the value of
the Mortgaged Property be set off against any part of the sums secured
hereby.
2.10 Suits to Protect the
Mortgaged Property. If an Event of Default shall have occurred
and is continuing, the Mortgagee shall have power (a) to institute and maintain
such suits and proceedings as it may deem expedient to prevent any impairment of
the Mortgaged Property by any acts which may be unlawful or any violation of
this Mortgage, (b) to preserve or protect its interest in the Mortgaged Property
and in the income, revenues, rents, and profits arising therefrom, and (c) to
restrain the enforcement of or compliance with any legislation or other
governmental enactment, rule, or order that may be unconstitutional or otherwise
invalid, if the enforcement of or compliance with such enactment, rule or order
would impair the security hereunder or be prejudicial to the interest of the
Mortgagee.
2.11 Mortgagor to Pay and Perform
all Secured Obligations on Any Event of Default; Application of Moneys by
Mortgagee. If an Event of Default occurs and is continuing,
then, upon demand of the Mortgagee, the Mortgagor will pay to the Mortgagee the
whole amount of the Secured Obligations; and in case the Mortgagor shall fail to
pay the same forthwith upon such demand, the Mortgagee shall be entitled to xxx
for and to recover judgment for the whole amount so due and unpaid together with
costs, which shall include the reasonable compensation, expenses, and
disbursements of the Mortgagee’s agents and attorneys.
2.12 Delay or Omission No
Waiver. No delay or omission of the Mortgagee or of any holder
of the Term Notes to exercise any right, power, or remedy accruing upon any
default or Event of Default shall exhaust or impair any such right, power, or
remedy or shall be construed to be a waiver of any such default or Event of
Default, or acquiescence therein; and every right, power, and remedy given by
this Mortgage to the Mortgagee may be exercised from time to time and as often
as may be deemed expedient by the Mortgagee.
2.13 No Waiver of One Default to
Affect Another, etc. No waiver of any default or Event of
Default hereunder shall extend to or shall affect any subsequent or any other
then existing default or Event of Default or shall impair any rights, powers, or
remedies consequent thereon.
If the
Mortgagee (a) grants forbearance or an extension of time for the payment of or
performance of the Secured Obligations secured hereby; (b) takes other or
additional security for the payment thereof; (c) waives or does not exercise any
right granted herein or in the Loan Documents; (d) releases any part of the
Mortgaged Property from the lien of this Mortgage or otherwise changes any of
the terms, of the Loan Agreement or the other Loan Documents or this Mortgage;
(e) consents to the filing of any map, plat, or replat thereof; (f) consents to
the granting of any easement thereon; or (g) makes or consents to any agreement
subordinating the lien or charge hereof, any such act or omission shall not
release, discharge, modify, change, or
16
affect
the original liability of the Borrowers under the Loan Agreement or the other
Loan Documents, or of the Mortgagor under this Mortgage or otherwise or any
subsequent purchaser of the Mortgaged Property or any part thereof, or any
maker, co-signer, endorser, surety, or guarantor; nor shall any such act or
omission preclude the Mortgagee from exercising any right, power, or privilege
herein granted or intended to be granted in the event of any other default then
made or of any subsequent default, nor, except as otherwise expressly provided
in an instrument or instruments executed by the Mortgagee, shall the lien of
this Mortgage be altered thereby. In the event of the sale or
transfer by operation of law or otherwise of all or any part of the Mortgaged
Property, the Mortgagee, at its option, without notice to any person or
corporation hereby is authorized and empowered to deal with any such vendee or
transferee with reference to the Mortgaged Property or the Secured Obligations
secured hereby, or with reference to any of the terms or conditions hereof, as
fully and to the same extent as it might deal with the original parties hereto
and without in any way releasing or discharging any of the liabilities or
undertakings hereunder.
2.14 Discontinuance of
Proceedings—Position of Parties, Restored. In case the
Mortgagee shall have proceeded to enforce any right or remedy under this
Mortgage by foreclosure, entry, or otherwise, and such proceedings shall have
been discontinued or abandoned for any reason, or shall have been determined
adversely to the Mortgagee, then and in every such case the Mortgagor and the
Mortgagee shall be restored to their former positions and rights hereunder, and
all rights, powers, and remedies of the Mortgagee shall continue as if no such
proceeding has been taken.
2.15 Remedies
Cumulative. No right, power, or remedy conferred upon or
reserved to the Mortgagee by this Mortgage is intended to be exclusive of any
right, power, or remedy, but each and every such right, power, and remedy shall
be cumulative and concurrent and shall be in addition to any other right, power,
and remedy given hereunder or now or hereafter existing at law or in equity or
by statute.
2.16 Rights of a Secured
Party. Upon the occurrence of an Event of Default that is
continuing, the Mortgagee, in addition to any and all remedies it may have or
exercise under this Mortgage, the Loan Agreement, the other Loan Documents or
under applicable law, may immediately and without demand, exercise any and all
of the rights of a secured party upon default under the UCC, all of which shall
be cumulative. Such rights shall include, without
limitation:
(a) The right
to take possession of the Collateral (as hereinafter defined in Section 3.05
hereof) without judicial process and to enter upon any premises where the
Collateral may be located for the purposes of taking possession of, securing,
removing, and/or disposing of the Collateral without interference from Mortgagor
or any Borrower and without any liability for rent, storage, utilities or other
sums;
(b) The right
to sell, lease, or otherwise dispose of any or all of the Collateral, whether in
its then condition or after further processing or preparation, at public or
private sale, and unless the Collateral is perishable or threatens to decline
speedily in value or is of a type customarily sold on a recognized market,
Mortgagee shall give to Mortgagor at least ten (10) days’ prior notice of the
time and place of any public sale of the Collateral or of the time after
17
which any
private sale or other intended disposition of the Collateral is to be made, all
of which Mortgagor agrees shall be reasonable notice of any sale or disposition
of the Collateral;
(c) The right
to require Mortgagor, upon request of Mortgagee, to assemble and make the
Collateral available to Mortgagee at a place reasonably convenient to Mortgagor
and Mortgagee; and
(d) The right
to notify account debtors for obligations in which Mortgagee has an interest as
set forth in this Mortgage, and demand and receive payment
therefrom.
To
effectuate the rights and remedies of Mortgagee upon and during the continuance
of an Event of Default, Mortgagor does hereby irrevocably appoint Mortgagee
attorney-in-fact for Mortgagor, with full power of substitution following the
occurrence and during the continuance of an Event of Default to sign, execute,
and deliver any and all instruments and documents and do all acts and things to
the same extent as Mortgagor could do, and to sell, assign, and transfer any
Collateral to Mortgagee or any other party.
ARTICLE
III
3.01 Successors and Assigns
Included in Parties. Whenever in this Mortgage one of the
parties hereto is named or referred to, the heirs, administrators, executors,
successors, and assigns of such party shall be included, and all covenants and
agreements contained in this Mortgage by or on behalf of the Mortgagor or by or
on behalf of Mortgagee shall bind and inure to the benefit of its respective
heirs, administrators, executors, successors, and assigns, whether so expressed
or not.
3.02 Sale of Mortgaged
Property/Termination of Mortgage. If the Mortgagor is
permitted to sell the Mortgaged Property pursuant to the Loan Agreement, then,
upon such sale in accordance with the terms and conditions of the Loan Agreement
and upon Mortgagee’s satisfaction that all of the conditions for the sale of the
Mortgaged Property under the Loan Agreement have been satisfied, Mortgagee shall
release this Mortgage of record, and this Mortgage shall be
terminated.
3.03 Headings,
etc. The headings of the articles, sections, paragraphs, and
subdivisions of this Mortgage 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.
3.04 Invalid Provisions to Affect
No Others. In case any one or more of the covenants,
agreements, terms, or provisions contained in this Mortgage or in the Loan
Agreement or the other Loan Documents shall be invalid, illegal, or
unenforceable in any respect, the validity of the remaining covenants,
agreements, terns, and provisions contained herein and in the Loan Agreement or
the other Loan Documents shall in no way be affected, prejudiced, or disturbed
thereby.
3.05 Collateral; Fixture
Filing. Mortgagor grants a security interest to Mortgagee in
the Mortgaged Property to the extent any part thereof constitutes personal
property of the Mortgagor under the UCC or other applicable law (said personal
property, tangible and intangible, being collectively referred to in this
Mortgage as the “Collateral”), and
this Mortgage
18
shall
constitute a security agreement under the UCC or other law applicable to the
creation of liens upon and security interests in personal
property. Mortgagor authorizes and consents to the Mortgagee filing
financing statements with the Office of the Circuit Clerk and Ex-Officio
Recorder of Union County, Arkansas, and covenants and agrees to execute, file,
and refile such financing statements, continuation statements or other documents
as Mortgagee shall require from time to time with respect to such
Collateral. If an Event of Default occurs and is continuing, the
Mortgagee shall have all rights and remedies of a secured party under the UCC or
other law applicable to liens upon and security interests in personal
property. In addition, the Mortgagee may file a financing statement
in any office or jurisdiction where filing is deemed necessary or desirable by
Mortgagee without the consent of Mortgagor, and if requested to do so, Mortgagor
will join in the execution of same as requested by Mortgagee and will pay all
costs of any filing.
This
Mortgage constitutes a “fixture filing” (as defined in Section 9102(a)(40) of
the UCC) and, to that end, Mortgagor acknowledges that (i) this Mortgage
covers goods which are or are to become fixtures on the Land, (ii) this
financing statement is to be recorded in the Office of the Circuit Clerk and
Ex-Officio Recorder of Union County, Arkansas, (iii) Mortgagor is the record
owner of the fee interest in the Land, and (iv) products of such goods are also
covered by this financing statement. Mortgagor, as “debtor”, for
purposes of the UCC, also represents to Mortgagee, as of the date hereof, that
the following information set forth in clauses (i), (v) and (vi) below, is true
and correct:
(i) The
“Debtor” is the Mortgagor and the “Secured Party” is the Collateral Agent for
the benefit of the Secured Parties. The exact legal name and address
of the Debtor are:
Northwest Financial
Corporation
00 Xxxxx Xxxxxxxxxxxx
Xxxxxxxx Xxxx,
Xxxxxxxx 00000
(ii) Name and address of Secured
Party:
Banc of
America Leasing & Capital LLC
c/o
Xxxxxxxxx X. Xxxxxx, VP; Group Operations Manager
Bank of
America
MA5-100-32-01
000
Xxxxxxx Xx.
Xxxxxx,
XX 00000
(iii) Description of the types (or
items) of property covered by this Financing Statement: all of
the property comprising the Mortgaged Property other than the Land.
(iv) Description of real estate
to which collateral is attached or upon which it is
located: Described in Exhibit
A.
(v) Debtor’s Organizational and
Tax Identification Numbers:
Org
No. None
Tax
ID
00-0000000
19
(vi) The
debtor’s chief executive office is located in the State of Oklahoma, and the
debtor’s state of formation is the State of Oklahoma.
Information
concerning the security interest herein granted may be obtained from the parties
at the addresses of the parties set forth in the first paragraph of this
Mortgage. Any reproduction of this Mortgage or of any other security
agreement or financing statement is sufficient as a financing
statement.
3.06 Covenant Regarding
Compliance. Mortgagor shall keep and maintain the Mortgaged
Property in compliance with, and shall not cause, permit or suffer the Mortgaged
Property to be in violation of any Environmental Law (as defined below), except
for noncompliance that could not reasonably be expected to have a Material
Adverse Effect.
3.07 Notice. Mortgagor
represents and warrants to Mortgagee as of the date of the Loan Agreement, the
date of the Borrowing Notice and the date of the Borrowing Date (as each such
term is defined in the Loan Agreement) that Mortgagor has not received any
notice of a violation of any Environmental Law, nor incurred any previous
liability therefor, except as disclosed in writing to Mortgagee in connection
with the Loan Agreement. To the extent that such could reasonably be
expected to (i) have a Material Adverse Effect (as defined in the Loan
Agreement) or (ii) cause the Mortgaged Property to be subject to any
restrictions on ownership, occupancy, liability, use, transferability, or
marketability under any Environmental Law. Mortgagor shall give
prompt written notice to Mortgagee of:
(a) becoming
aware of any violation of Environmental Law on the Mortgaged Property, or any
use, generation, manufacture, production, storage, release, discharge or
disposal of any Hazardous Materials on, under, from or about the Mortgaged
Property or the migration thereof to or from the Mortgaged Property in each case
in violation of any Environmental Law;
(b) the
commencement or institution of any proceeding, inquiry or action by or notice
from any governmental authority with respect to the use or presence of any
Hazardous Materials on the Mortgaged Property or the migration thereof from or
to other property;
(c) all
claims made by any third party against Mortgagor or the Mortgaged Property
relating to any damage, contribution, cost recovery, compensation, loss or
injury resulting from any Hazardous Materials;
(d) Mortgagor’s
discovery of any occurrence or condition on any real property adjoining or in
the vicinity of the Mortgaged Property that could cause the Mortgaged Property
or any part thereof to be subject to any restrictions on the ownership,
occupancy, transferability or use of the Mortgaged Property under any
Environmental Law, or to be otherwise subject to any restrictions on the
ownership, occupancy, transferability or use of the Mortgaged Property under any
Environmental Law.
3.08 Indemnity. Mortgagor
shall protect, indemnify and hold harmless Mortgagee, its directors, officers,
employees, agents, successors and assigns (each, an “Indemnitee”) from and
against any and all claims, loss, damage, cost, expense, liability, fines,
penalties, charges, administrative and judicial proceedings and orders,
judgments, remedial action requirements, enforcement actions of any kind
(including, without limitation, attorneys’ fees and costs), or any
20
other
Environmental Liability, directly or indirectly arising out of or attributable
to, in whole or in part, the breach of any Environmental Laws, the covenants,
representations and warranties of this Section or the use, generation,
manufacture, production, storage, release, threatened release, discharge,
disposal, or presence of a Hazardous Materials on, under, from or about the
Mortgaged Property, whenever the same shall have occurred, whether before or
after the date of this Mortgage, or any other activity carried on or undertaken
on or off the Mortgaged Property, whenever the same shall have occurred, whether
before or after the date of this Mortgage, whether by Mortgagor or any
employees, agents, contractors or subcontractors of Mortgagor, or any third
persons occupying or present on the Mortgaged Property, in connection with the
handling, treatment, removal, storage, decontamination, clean-up, transport or
disposal of any Hazardous Materials located or present on, under, from or about
the Mortgaged Property, including, without limitation: (i) all consequential
damages; (ii) the costs of any required or necessary repair, cleanup or
detoxification of the Mortgaged Property and the preparation and implementation
of any closure, remedial or other required plans including, without limitation:
(A) the costs of removal or remedial action incurred by the United States
Government or the State, or response costs incurred by any other person, or
damages from injury to, destruction of, or loss of natural resources, including
the costs of assessing such injury, destruction or loss, incurred pursuant to
the Comprehensive Environmental Response, Compensation and Liability Act of
1980, 42 U.S.C. § 9601 et
seq. as amended; and (B) the costs and expenses of abatement, correction
or clean-up, fines, damages, response costs or penalties which arise from the
provisions of any other statute, state or federal, or any other Environmental
Laws; and (iii) liability for personal injury or property damage arising
under any statutory or common-law tort theory, including damages assessed for
the maintenance of the public or private nuisance, response costs or for the
carrying on of an abnormally dangerous activity or any other Environmental
Liability, IN ALL CASES, WHETHER OR NOT CAUSED BY OR ARISING, IN WHOLE OR IN
PART, OUT OF THE COMPARATIVE, CONTRIBUTORY OR SOLE NEGLIGENCE OF THE INDEMNITEE;
provided that such indemnity shall not, as to any Indemnitee, be available to
the extent that such losses, claims, damages, liabilities or related expenses
(x) are determined by a court of competent jurisdiction by final and
nonappealable judgment to have resulted from the gross negligence or willful
misconduct of such Indemnitee or (y) result from a claim brought by Mortgagor or
any other Loan Party against an Indemnitee for breach in bad faith of such
Indemnitee’s obligations hereunder or under any other Loan Document, if such
Mortgagor or such Loan Party has obtained a final and nonappealable judgment in
its favor on such claim as determined by a court of competent
jurisdiction.
The
foregoing indemnity shall further apply to any residual contamination on, under,
from or about the Mortgaged Property, or affecting any natural resources arising
in connection with the use, generation, manufacturing, production, handling,
storage, transport, discharge or disposal of any such Hazardous Materials
whenever the same shall have occurred, whether before or after the date of this
Mortgage, and irrespective of whether any of such activities were or will be
undertaken in accordance with Environmental Law or other applicable laws,
regulations, codes and ordinances. This indemnity is intended to be
operable under 42 U.S.C. Section 9607(e)(1), and any successor Section thereof
and shall survive the reconveyance of the lien of this Mortgage, the
extinguishment of the lien by foreclosure or action in lieu thereof, and any
transfer of the Mortgaged Property by Mortgagor.
21
The
foregoing indemnity shall in no manner be construed to limit or adversely affect
Mortgagee’s rights under this Section, including, without limitation,
Mortgagee’s rights to approve any remedial work or the contractors and
consulting engineers retained in connection therewith.
3.09 Inspection. In
the event that (i) an Event of Default has occurred or (ii) Mortgagee
reasonably believes that there may be a violation or threatened violation by
Mortgagor of any Environmental Law or a violation or threatened violation by
Mortgagor of any covenant under this Section, Mortgagee is authorized, upon
reasonable advance notice to Mortgagor, but not obligated, by itself, its
agents, employees or workmen to enter at any reasonable time upon any part of
the Mortgaged Property for the purposes of inspecting the same for Hazardous
Materials and Mortgagor’s compliance with this Section, and such inspections may
include, without limitation, soil borings. Mortgagor agrees to pay to
Mortgagee, upon Mortgagee’s demand, all reasonable third party expenses, costs
or other amounts incurred by Mortgagee in performing any inspection for the
purposes set forth in this Subparagraph 3.09.
3.10 Costs and Expenses of
Mortgagee. All reasonable third party costs and expenses
incurred by Mortgagee under Section 3 and
all subparagraphs thereof shall be immediately due and payable upon demand and
shall become part of the indebtedness secured hereby and shall bear interest at
the rate set forth in the Loan Agreement from the date of payment by Mortgagee
until repaid.
3.11 Definitions. The
following terms shall have the following meanings for purposes of this Section 3 and
all subparagraphs thereof:
(a) “Environmental Laws”
means any and all present and future Federal, state, local, and foreign
statutes, laws, regulations, ordinances, rules, judgments, orders, decrees,
directives, permits, concessions, grants, franchises, licenses, agreements or
governmental restrictions relating to pollution, industrial hygiene,
environmental conditions, the protection of human health or the environment or
the release of any materials into the environment, including those related to
hazardous substances or wastes, air emissions, soil and ground water
contamination, discharges to waste or public systems, or the assessment,
monitoring or remediation of the same, as may be amended from time to time,
including, without limitation, the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980 (“CERCLA”) as amended,
42 U.S.C. Sections 9601 et
seq., and the Resource Conservation and Recovery Act of 1976 (“RCRA”), 42 U.S.C.
Sections 6901 et
seq.
(b) “Environmental
Liability” means any claim, demand, order, suit, obligation, cost,
liability, contingent or otherwise (including any liability for damages, costs
of environmental remediation, monitoring, fines, penalties or indemnity
obligations), loss or expense (including attorneys’ and consultants’ fees and
expenses), whenever the same shall have occurred, whether before or after the
date of the Loan, of any Mortgagor, any other Loan Party (other than Parent) or
any of their respective Subsidiaries (other than the Excluded Subsidiaries)
directly or indirectly resulting from or based upon (a) violation of any
Environmental Law, (b) the generation, use, handling, processing, labeling,
recycling, transportation, storage, treatment or disposal of any Hazardous
Materials, (c) exposure to any Hazardous Materials, (d) the release or
threatened release of any Hazardous Materials into the environment, (e) alleged
personal
22
injury or
property damage arising under any statutory or common-law tort theory, including
damages assessed for the maintenance of a public or private nuisance, response
costs or for the carrying on of an abnormally dangerous activity, or (f) any
contract, agreement or other consensual arrangement pursuant to which liability
is assumed or imposed with respect to any of the foregoing.
(c) “Hazardous
Materials” means all explosive or radioactive substances or wastes and all
hazardous or toxic substances, wastes or other pollutants, including petroleum
or petroleum distillates, asbestos or asbestos-containing materials,
polychlorinated biphenyls, radon gas, infectious or medical wastes and all other
substances or wastes of any nature regulated pursuant to any Environmental
Law.
(d) “Requirement of Law”
shall mean the common law and all federal, state, local and foreign laws, rules
and regulations, orders, judgments, decrees and other determinations of any
Governmental Authority or arbitrator, applicable to or binding to the person or
property in question.
3.12 Representations and
Warranties. Mortgagor represents and warrants to Mortgagee and
the Lenders as of the date of the Loan Agreement, the date of the Borrowing
Notice and the date of the Borrowing Date (as each such term is defined in
Section 3.07 above), knowing that the Lenders will rely on such representations
and warranties as incentive to make the Term Loans to the Borrowers, that,
except as otherwise provided in, or disclosed as a schedule to, the Loan
Agreement.
(a) Mortgagor
is a duly organized and existing corporation having full corporate power and
authority to consummate the transactions contemplated by this Mortgage, and the
execution, delivery and performance of this Mortgage, and the documents executed
in connection herewith have been duly authorized by all necessary corporate
action.
(b) All
utility and sanitary sewage services necessary for the current use of the
Mortgaged Property and all roads necessary for the current use of the Mortgaged
Property are available pursuant to permanent private or public easements which
are not subject to the exclusive rights of any other persons which could
interfere with Mortgagor’s use thereof.
(c) There are
no proceedings pending, or, to the best of Mortgagor’s knowledge, threatened, to
acquire any Power of condemnation or eminent domain with respect to the
Mortgaged Property, or any interest therein, or to enjoin or similarly prevent
the use of any of the Mortgaged Property as presently used.
(d) The
Mortgaged Property complies with all applicable laws, ordinances, rules and
regulations, and all laws, ordinances, rules and regulations relating to zoning,
building codes, set back requirements and environmental matters except where as
such violation in the aggregate will not result in a Material Adverse Effect, or
such violation is subject to a Permitted Protest or is disclosed in Section 5.09
of the Loan Agreement.
(e) Except as
set forth on Exhibit
B hereto, there are no leases affecting the Mortgaged
Property. Each lease, if any, is in full force and effect, and no
rents have been discounted, released, waived, compromised or otherwise
discharged except for prepayment of
23
rent of
not more than one month prior to the accrual thereof. There are no
material defaults now existing under any of the leases by the landlord or
tenant, and there exists no state of facts which, with the giving of notice or
lapse of time or both, would constitute a default under any of the leases by the
landlord or tenant. Each lease is subject and subordinate to the
Mortgage. Each lease is subject to no lien, charge or encumbrance
other than this Mortgage, except Permitted Encumbrances. No tenant
under a lease or any other person has an option or right of first refusal to
purchase any portion of the Mortgaged Property. No tenant under any
lease has, as of the date hereof, paid rent more than thirty (30) days in
advance, and the rents under such leases have not been waived, released, or
otherwise discharged or compromised.
(f) All
easement agreements, covenants or restrictive agreements, supplemental
agreements and any other instruments mortgaged hereby are and will remain valid,
subsisting and in full force and effect in accordance with their terms, unless
the failure to remain valid, subsisting and in full force and effect, could not,
individually or in the aggregate, have or result in a Material Adverse Effect,
and Mortgagor is not in default thereunder and has fully performed the material
terms thereof required to be performed through the date hereof, and has no
knowledge of any default thereunder or failure to fully perform the terms
thereof by any other party, nor of the occurrence of any event which after
notice or the passage of time or both will constitute a default thereunder
which, in each such instance, could, individually or in the aggregate, have or
result in a Material Adverse Effect.
(g) This
Mortgage, when duly recorded in the appropriate public records and when
financing statements are duly filed in the appropriate public records, will
create a valid, perfected and enforceable first priority lien upon and security
interest in all the Mortgaged Property free and clear of all Liens other than
the Permitted Encumbrances and there are no defenses or offsets to this Mortgage
or to any of the Secured Obligations secured hereby.
(h) The
Mortgaged Property is not part of a larger tract of land owned by Mortgagor or
its Affiliates, nor is it otherwise included under any unity of title or similar
covenant with other real property not encumbered by this Mortgage.
(i) The
Mortgaged Property is covered by a title insurance policy (the “Title Insurance
Policy”), insuring Mortgagor, its successors and assigns, as to its fee
simple title to the Mortgaged Property free of all Liens except Permitted
Encumbrances. No claims have been made under such Title Insurance
Policy and Mortgagor has not, by act or omission, done anything which would
impair the coverage of such title insurance policy.
(j) The
Mortgaged Property, including without limitation the location, existence, use,
occupancy and operation of the Mortgaged Property, is in compliance in all
material respects with all applicable Laws including without limitation the
building and zoning laws of the jurisdiction in which the Mortgaged Property is
situated and all easements, declarations, covenants and restrictions affecting
the Mortgaged Property, except where such violation is subject to a Permitted
Protest or would not have a Material Adverse Effect. All material
licenses and permits which may be required with respect to the use, occupancy,
operation and maintenance of the Mortgaged Property have been obtained and are
in full force and effect and each improvement located on the Mortgaged Property
complies therewith. Except as disclosed in Section 5.09 of the Loan
Agreement, no notice of any violation of any
24
Requirement
of Law has been entered or received by Mortgagor and to Mortgagor’s knowledge
there is no basis for the entering of any such notice.
(k) All
streets, roads, highways, bridges and waterways necessary for access to and full
use, occupancy, operation and disposition of the Mortgaged Property have been
completed, have been dedicated to and accepted by the appropriate municipal
authority and are open and available to the Mortgaged Property without further
condition or cost to Mortgagor.
(l) The
Mortgaged Property is free and clear of any mechanics’ or materialmen’s liens or
liens in the nature thereof, and no rights are outstanding that under law would
give rise to any such liens, any of which liens are or may be prior to, or equal
with, the lien of this Mortgage, except those which are insured against by the
Mortgagee’s title insurance policy.
(m) No lease
or contract or easement, right of way, permit or declaration relating to the
Mortgaged Property (collectively, “Property Agreements”)
provides any party with the right to obtain a lien or encumbrance upon the
Mortgaged Property superior to the lien of this Mortgage.
(n) Mortgagor
has delivered to Mortgagee true, correct and complete copies of all Property
Agreements that provides to any party the right to obtain a lien or encumbrance
upon the Mortgaged Property and no default exists or which the passing of time
or the giving of notice or both would exist under any Property Agreement which
would, in the aggregate, have a Material Adverse Effect.
(o) The
Mortgaged Property forms no part of any property owned, used or claimed by
Mortgagor as a residence or business homestead and is not exempt from forced
sale under the laws of the state in which the Mortgaged Property is
located. Mortgagor hereby disclaims and renounces each and every
claim to all or any portion of the Mortgaged Property as a homestead and the
Term Notes evidenced by the Loan Agreement and the other Loan Documents are
issued solely for business, investment, commercial or other similar
purposes.
(p) There are
no outstanding options or rights of first offer or refusal to purchase all or
any portion of the Mortgaged Property or Mortgagor’s interest therein or
ownership thereof.
3.13 Notices. Any
and all notices, elections or demands permitted or required to be made under
this Mortgage, the Loan Agreement and the other Loan Documents, or any other
agreement executed in connection with or relating to the Loan Agreement and the
other Loan Documents or this Mortgage, or by applicable law, shall be given and
be deemed effective (a) on the date delivered in person, (b) three (3) days
following the date deposited with the U.S. Mail, certified or registered,
postage prepaid, return receipt requested, or (c) one (1) business day following
the date sent by Federal Express or overnight U.S. Mail or other national
overnight carrier, and addressed in each such case to the parties at their
respective addresses set forth in the heading of this instrument or such other
single address as either party may designate in a written notice given as herein
provided (except that a change of address notice shall not be effective until
actual receipt).
25
3.14 Controlling
Law. The
Secured Obligations and all terms and provisions in this Mortgage shall
be governed by and construed and interpreted in accordance with the laws of the
State of
New York, except for the creation, perfection and enforcement of certain lien
rights and remedies provided herein which shall be governed by and construed in
accordance with the laws of the State of Arkansas. Mortgagor
expressly acknowledges that by their respective terms the Loan Documents shall
be governed and construed in accordance with the laws of the State of New York,
and for purposes of consistency, Mortgagor agrees that in any in personam
proceeding related to this Mortgage the rights of the parties to this Mortgage
shall also be governed by and construed in accordance with the laws of the State
of New York governing contracts made and to be performed in that
State.
3.15 Waiver of Jury
Trial. MORTGAGOR HEREBY WAIVES ANY RIGHT THAT IT MAY HAVE TO A
TRIAL BY JURY ON ANY CLAIM, COUNTERCLAIM, SETOFF, DEMAND, ACTION OR CAUSE OF
ACTION (A) ARISING OUT OF OR IN ANY WAY RELATED TO THIS MORTGAGE, THE LOAN
AGREEMENT OR THE OTHER AGREEMENTS, OR (B) IN ANY WAY CONNECTED WITH OR
PERTAINING OR RELATED TO OR INCIDENTAL TO ANY DEALINGS OF MORTGAGEE AND/OR
MORTGAGOR WITH RESPECT TO THE LOAN AGREEMENT OR THE OTHER AGREEMENTS OR IN
CONNECTION WITH THIS MORTGAGE OR THE EXERCISE OF EITHER PARTY’S RIGHTS AND
REMEDIES UNDER THIS MORTGAGE, THE LOAN AGREEMENT OR THE OTHER AGREEMENTS OR
OTHERWISE, OR THE CONDUCT OR THE RELATIONSHIP OF THE PARTIES HERETO, IN ALL OF
THE FOREGOING CASES WHETHER NOW EXISTING OR HEREAFTER ARISING AND WHETHER
SOUNDING IN CONTRACT, TORT OR OTHERWISE. MORTGAGOR AGREES THAT
MORTGAGEE MAY FILE A COPY OF THIS AGREEMENT WITH ANY COURT AS WRITTEN EVIDENCE
OF THE KNOWING, VOLUNTARY, AND BARGAINED AGREEMENT OF MORTGAGOR IRREVOCABLY TO
WAIVE ITS RIGHTS TO TRIAL BY JURY AS AN INDUCEMENT OF LENDERS TO PURCHASE THE
NOTES FROM BORROWERS, AND THAT, TO THE EXTENT PERMITTED BY APPLICABLE LAW, ANY
DISPUTE OR CONTROVERSY WHATSOEVER BETWEEN MORTGAGOR AND MORTGAGEE SHALL INSTEAD
BE TRIED IN A COURT OF COMPETENT JURISDICTION BY A JUDGE SITTING WITHOUT A
JURY.
3.16 Assignment of Leases and
Rents; Collection of Rents, Issues and Profits; Approval of
Leases.
(a) Assignment of Leases and
Rents. Mortgagor assigns all leases, licenses and other
occupancy agreements (“Leases”) and all
rents, issues and profits to Mortgagee absolutely and unconditionally and not
merely as additional collateral or security for the payment and performance of
the Secured Obligations, but subject to a license back to Mortgagor as set forth
below. Mortgagor appoints Mortgagee as Mortgagor’s attorney-in-fact
to execute unilaterally and record, at Mortgagee’s election, a document
subordinating this Deed of Trust to the Leases, provided that the subordination
will not affect (i) the priority of Mortgagee’s entitlement to any insurance or
condemnation proceeds or (ii) the priority of this Deed of Trust over
intervening liens or liens arising under or with respect to the
Leases.
26
(b) Mortgagor’s Authority to
Collect and Retain Rents. Mortgagee confers upon Mortgagor a
license to collect and retain the rents, issues and profits of the Mortgaged
Property as they become due and payable, subject, however, to the right of
Mortgagee to revoke such license at any time following the occurrence of an
Event of Default in its sole discretion and without notice to
Mortgagor. If an Event of Default shall have occurred and is
continuing, Mortgagee shall have the absolute right to revoke such authority and
collect and retain the rents, issues and profits assigned herein, without taking
possession of all or any part of the Mortgaged Property. The right to
collect rents, issues and profits herein provided shall not grant to Mortgagee
the right to possession, except as expressly herein provided; nor shall such
right impose upon Mortgagee the duty to produce rents, issues or profits or
maintain the Property in whole or in part. Possession of the
Mortgaged Property by a receiver appointed by a court of competent jurisdiction
shall not be considered possession of the Mortgaged Property by Mortgagee for
purposes hereof. Following the occurrence of an Event of Default that
is continuing, Mortgagee may, in its sole discretion determine the order of
priority for application of any rents, issues and profits collected against the
costs of collection and any indebtedness secured by or obligations of Mortgagor
arising under the Loan Agreement and the other Loan Documents in accordance with
the terms of the Loan Agreement. Collection of any rents, issues and
profits by Mortgagee shall not cure or waive any Event of Default or notice of
Event of Default, or invalidate any acts done pursuant to such
notice.
(c) Mortgagor’s Authority to
Enter into Leases. Mortgagor shall not enter into any lease of
the Mortgaged Property, or any portion thereof, or modify or amend or supplement
any such lease, or extend any existing lease, without the prior written consent
of Mortgagee (which consent shall not be unreasonably withheld), except as
otherwise permitted in the Loan Agreement. Mortgagor shall, on
demand, execute such further assignments to Mortgagee of any or all leases,
agreements, rents, issues or profits of the Mortgaged Property as Mortgagee may
require in accordance with the terms of the Loan Agreement. Upon
request of Mortgagee, Mortgagor shall promptly deliver to Mortgagee a copy of
the fully executed original of any or all leases or agreements entered into
hereunder. All leases of the Mortgaged Property shall be subordinate
to this Mortgage unless Mortgagee elects in writing, at its sole option, to
subordinate this Mortgage to a particular lease or leases.
3.17 Impound
Account. Upon the happening of an Event of Default, and so
long as the Event of Default shall continue, at the request of Mortgagee,
Mortgagor shall pay to Mortgagee each month on the first day thereof an amount
reasonably estimated by Mortgagee to be equal to (a) the taxes and assessments
payable under Section
1.03 and (b) premiums next due for all insurance carried under Section 1.04, each
such estimate divided by the number of months to lapse preceding the month in
which it will become due and Mortgagor irrevocably grants and assigns to
Mortgagee a security interest in and to the amounts, if any, so paid by
Mortgagor. Such funds shall not be claimed to be held in trust and no
sums so paid shall bear interest, except to the extent of the minimum amount of
interest, if any, required by law; and Mortgagee shall, at its option, either
apply such funds to, or release such funds to Mortgagor for, payment of, such
taxes and assessments and premiums. If the total amount retained in
the impound account exceeds the amount of payments actually applied by Mortgagee
as set forth above, such excess may be credited by Mortgagee on subsequent
payments to be made by Mortgagor hereunder or, at the option of Mortgagee,
refunded to Mortgagor; but if the security account shall not be sufficient to
pay the sums required at least thirty (30) days before the same are due and
payable,
27
Mortgagor
shall, within three (3) business days of receipt of written demand therefore
from Mortgagee, deposit with Mortgagee the full amount of any such
deficiency. Upon repayment of the amounts evidenced by the Term Notes
and the satisfaction of all other Secured Obligations of Mortgagor secured
hereby, any remaining funds held under this paragraph shall be released to
Mortgagor.
3.18 Conflicts. If
any provision hereof conflicts with the terms of the Loan Agreement, the terms
of the Loan Agreement shall be controlling.
3.19 Accommodation
Provisions. To the extent this Mortgage secures Obligations of
a party other than Mortgagor (an “Obligor”), Mortgagor
has executed and delivered this Mortgage as an accommodation instrument with the
intent of subjecting its interests in the Mortgaged Property to the lien of this
Mortgage as security for the Secured Obligations. Mortgagor hereby
agrees, to the fullest extent permitted by law, not to assert or take advantage
of:
(a) Any right
to require Mortgagee to proceed against any other Obligor, including as maker of
the Term Notes, or any other person or to proceed against or exhaust any other
security held by Mortgagee at any time or to pursue any other remedy in
Mortgagee’s power before exercising any right or remedy under this
Mortgage.
(b) Any
defense that may arise by reason of:
(i) Mortgagee’s
failure to proceed against any other Obligor’s property, or any other party
against whom Mortgagee might assert a claim, before proceeding against Mortgagor
under this Mortgage; or
(ii) The
release, suspension, discharge or impairment of any of Mortgagee’s rights
against any other Obligor or any other party against whom Mortgagee might assert
a claim, whether such release, suspension, discharge or impairment is explicit,
tacit or inadvertent; or
(iii) Mortgagee’s
failure to pursue any other remedies available to Mortgagee that would reduce
the burden of the indebtedness secured hereby on Mortgagor’s interests in the
Mortgaged Property; or
(iv) Any
extension of the time for the payment or performance of any of any other
Obligor’s obligations under the Term Notes, or any of the other Loan Documents;
or
(v) Any
amendment of this Mortgage, the Term Notes or any of the other Loan Documents,
whether or not such amendment materially affects the risk that Mortgagor has
assumed by executing this Mortgage; or
(vi) The
incapacity or lack of authority of any other Obligor or any person or persons;
or
28
(vii) The
failure of Mortgagee to file or enforce a claim against the estate (in either
administration, bankruptcy or any other proceedings) of any partner of any other
Obligor or any other person or persons.
(c) Demand,
protest and notice of any kind, including, without limitation, the following
notices:
(i) Notice of
the evidence, creation or incurring of any new or additional indebtedness or
obligation (provided that such indebtedness or obligation is not secured by this
Mortgage); or
(ii) Notice of
any action or non-action on the part of any other Obligor or Mortgagee in
connection with any obligation or evidence of indebtedness held by Mortgagee as
collateral; or
(iii) Notice of
payment or non-payment by any other Obligor of the indebtedness secured by this
Mortgage.
(d) Any right
to assert against Mortgagee any defense arising by reason of any claim or
defense based upon an election of remedies by Mortgagee to foreclose, either by
judicial foreclosure or by exercise of the power of sale, this Mortgage, which
in any manner impairs, reduces, releases, destroys or extinguishes Mortgagor’s
subrogation rights, rights to proceed against any other Obligor for
reimbursement, or any other rights of Mortgagor to proceed against any other
person or security. Mortgagor waives all rights and defenses to
enforcement of all or any part of the indebtedness secured hereby which defenses
are based on an election of remedies by Mortgagee, even though the election of
remedies, such as nonjudicial foreclosure with respect to this Mortgage, may
destroy Mortgagor’s rights of subrogation and reimbursement against any other
Obligor. Mortgagor makes this waiver with full knowledge that if
Mortgagee (i) waives a deficiency judgment in a judicial foreclosure, or (ii)
exercises the power of sale under this Mortgage, any action by Mortgagor against
any other Obligor to obtain reimbursement of any amount paid by Mortgagor
hereunder may be barred by reason of (x) Mortgagee’s waiver of such deficiency
in a judicial foreclosure or (y) Mortgagee’s exercise of such power of
sale. Mortgagor understands that absent the waiver set forth herein,
Mortgagor may have a defense to its obligations hereunder with respect to a
deficiency following a nonjudicial foreclosure or a judicial foreclosure in
which the Mortgagee waived its right to a deficiency judgment against any other
Obligor and that by granting this waiver, Mortgagor is waiving this defense
which Mortgagor would have against Mortgagee.
(e) Any
rights arising because of Mortgagor’s payment or satisfaction of the
indebtedness secured hereby (i) against any other Obligor, by way of subrogation
to the rights of Mortgagee or otherwise, or (ii) against any other guarantor or
any other party obligated to pay any of the indebtedness secured hereby, by way
of contribution or reimbursement or otherwise, but only until the indebtedness
secured hereby is paid in full.
(f) Any duty
on the part of Mortgagee to disclose to Mortgagor any default under the Term
Notes or any other Loan Document.
29
(g) Any duty
on the part of Mortgagee to disclose to Mortgagor any facts Mortgagee may now
know or may hereafter know about any other Obligor or any successors in interest
(if any) regardless of whether Mortgagee (i) has reason to believe that any such
facts materially increase the risk beyond the risk which Mortgagor intends to
assume by executing this Mortgage, (ii) has reason to believe that these facts
are unknown to Mortgagor, or (iii) has a reasonable opportunity to communicate
such facts to Mortgagor, it being understood and agreed that Mortgagor is fully
responsible for being and keeping informed of the financial condition of any
other Obligor or any successor in interest of any other Obligor and of all
circumstances bearing on the risk of non-payment of any indebtedness of any
other Obligor to Mortgagee that is secured hereby.
(h) Any right
to object to the release of any portions of the Mortgaged Property from the lien
of this Mortgage notwithstanding the fact that such releases may be made without
Mortgagee having received any or adequate consideration therefor.
Mortgagor
further agrees that with respect to any obligation secured hereby Mortgagee may,
in such manner and upon such terms and at such times as Mortgagee deems best and
without demand or notice to or consent of Mortgagor (i) release any party now or
hereafter liable for the performance of any such obligation, (ii) extend the
time for the performance of any such obligation, (iii) accept additional
security therefor, and (iv) alter, substitute or release any property securing
such performance.
Before
executing this Mortgage, Mortgagor has made such independent legal and factual
inquiries and investigations as Mortgagor deemed necessary or desirable with
respect to the ability of any other Obligor to honor all of any other Obligor’s
covenants and agreements with Mortgagee, and Mortgagor has relied solely on said
independent inquiries and investigations preparatory to entering into this
Mortgage.
Mortgagor
agrees that Mortgagee may enforce this Mortgage without the necessity of
resorting to or exhausting any security or collateral securing the Secured
Obligations, without the necessity of proceeding against any guarantor, and
without the necessity of proceeding against any other
Obligor. Mortgagor hereby waives the right to require Mortgagee to
proceed against any other Obligor, to foreclose any lien on any real or personal
property securing the Secured Obligations, to exercise any right or remedy under
the Loan Documents, to pursue any other remedy or to enforce any other
right.
Notwithstanding
any modification, discharge or extension of the Secured Obligations or any
amendment, modification, stay or cure of Mortgagee’s rights which may occur in
any bankruptcy or reorganization case or proceeding concerning any other
Obligor, whether permanent or temporary, and whether assented to by Mortgagee,
Mortgagor hereby agrees that it shall be obligated hereunder to pay and perform
its obligations in accordance with the terms of this Mortgage and the other Loan
Documents in effect on the date hereof. Mortgagor understands and
acknowledges that by virtue of this Mortgage, it has specifically assumed any
and all risks of a bankruptcy or reorganization case or proceeding with respect
to any other Obligor. Without in any way limiting the generality of
the foregoing, any subsequent modification of the Secured Obligations in any
reorganization case concerning any other Obligor
30
shall not
affect the obligation of Mortgagor to perform its obligations hereunder and
under the other Loan Documents.
[No
Further Text on this Page; Signature Page Follows]
31
IN WITNESS WHEREOF, the
Mortgagor has executed this Mortgage, or has caused this Mortgage to be executed
on the day and year first above written.
NORTHWEST
FINANCIAL CORPORATION, an Oklahoma corporation
By: __________________________
Name: ________________________
Title: _________________________
STATE
OF ARKANSAS )
) ss.
COUNTY
OF ___________)
On this
the ____ day of _________________________, 20___, before me, _________________
the undersigned officer, personally appeared ___________________________, who
acknowledged himself/herself to be the ________________________ of
__________________________, a corporation, and that he/she, as such
_______________________________, being authorized so to do, executed the
foregoing instrument for the purposes therein contained, by signing the name of
the corporation by himself/herself as ________________________.
In
witness whereof I hereunto set my hand and official seal.
_______________________________
Notary
Public
My
Commission Expires:
____________________
32
EXHIBIT
A
LEGAL
DESCRIPTION
EXHIBIT
B
PERMITTED
ENCUMBRANCES
As
defined in the Loan Agreement including without limitation the
following:
[attach
pages showing permitted encumbrances under Arkansas Title Policy]
EXHIBIT
G
COLLATERAL
ASSIGNMENT OF AGREEMENTS
FOR VALUE RECEIVED, and to secure the
payment and performance by CHEROKEE NITROGEN COMPANY, an Oklahoma corporation
(“Assignor”) of
the Obligations, Assignor does hereby collaterally assign unto BANC OF AMERICA
LEASING & CAPITAL, LLC, not in its individual capacity but solely as
collateral agent, as Secured Party (the “Secured Party”) and
its successors and assigns, all of the Assignor’s right, title and interest in
and to each of the agreements listed on Schedule 1
hereto, as each such agreement may hereafter be executed, supplemented, modified
or amended from time to time (the “Assigned
Agreements”); provided, however, that the
Secured Party shall have no obligation or liability of any kind under or with
respect to the Assigned Agreements, either before or after the Secured Party’s
exercise of any rights hereby granted to it.
For all
purposes hereof, the capitalized terms used herein and not otherwise defined
shall have the meanings assigned thereto in that certain Term Loan Agreement
dated as of November 2, 2007 (the “Loan Agreement”)
among ThermaClime, Inc., Assignor and certain of their Affiliates, as borrowers,
each lender from time to time party thereto (the “Lenders”), Banc of
America Leasing & Capital, LLC, as administrative, Bank of Utah, as payment
agent, and Secured Party.
This
Assignment shall be effective as of November 2, 2007.
This
Assignment shall inure to the benefit of the Secured Party and its successors
and assigns, and shall be binding upon the Assignor and its successors and
assigns, and shall continue in full force and effect until all Obligations have
been fully and indefeasibly paid, performed and satisfied, at which time this
Assignment will terminate. The Secured Party will not exercise any of
its rights hereunder until there shall have occurred and be continuing an Event
of Default.
Subject
to the terms and conditions of this Assignment, the Assignor assigns, conveys
and transfers to the Secured Party, and creates in favor of the Secured Party a
security interest, as security for the Obligations, in, all of the Assignor’s
rights, titles, interests, privileges, benefits and remedies in, to and under
the Assigned Agreements, including, without limitation, all of Assignor’s (i)
rights to receive moneys due and to become due under or pursuant to any Assigned
Agreement, (ii) rights to receive insurance proceeds of any insurance,
indemnity, warranty, guaranty or collateral security with respect to any
Assigned Agreement, (iii) claims for damages arising out of or for breach of or
default under any Assigned Agreement, (iv) rights to terminate any Assigned
Agreement, to perform thereunder and to compel performance and otherwise
exercise all remedies thereunder, and (v) to the extent not included in the
foregoing, proceeds of any and all of the foregoing collateral.
Neither
this Assignment nor any action or omission by the Secured Party, the
Administrative Agent or any Lender shall constitute, or be deemed or construed
to constitute, an assumption by the Secured Party or any Lender of any of the
Assignor’s obligations under any of
the
Assigned Agreements, and the Assignor shall continue to be liable for all of the
Assignor’s obligations under the Assigned Agreements. The Secured
Party shall not have any obligation or liability under any such Assigned
Agreements by reason of this Assignment, nor shall the Secured Party be
obligated to perform any of the obligations or duties of the Assignor thereunder
or to take any action to collect or enforce any claim for payment assigned
hereunder. Notice of the acceptance of this Assignment by the Secured
Party is waived by the Assignor.
The
Assignor shall deliver to the Secured Party a duly executed Consent in the form
of Exhibit A to
this Assignment from the applicable Contract Party (as defined below) with
respect to each Assigned Agreement; provided that no failure or delay by the
Assignor in delivering any Consent shall limit, affect or invalidate the
assignment to the Secured Party of all of the Assigned Agreements as set forth
herein or the Secured Party’s or any Lender’s rights or remedies under this
Assignment with respect to any of the Assigned Agreements. For
purposes of this Assignment, “Contract Party” means a party to any of the
Assigned Agreements other than the Assignor.
The
Assignor hereby represents to the Secured Party, the Administrative Agent and
the Lenders that no authorizations, approval or other action by, and no notice
to or filing with, any governmental authority or regulatory body is required
either (i) for the grant by the Assignor or the assignment and security interest
granted hereby or for the execution, delivery and performance of this Assignment
by the Assignor, or (ii) for the perfection of or the exercise by the Secured
Party of its rights and remedies hereunder. The Assignor further
represents to the Secured Party, the Administrative Agent and the Lenders that
as of the date of this Assignment (i) no default or event which, with notice or
lapse of time or both, if uncured, would constitute a default by Assignor or to
Assignor’s knowledge by Contract Party has occurred under the Assigned
Agreements and (ii) all amounts due and payable to Contract Party under the
Assigned Agreements have been paid in full.
This
Assignment is a present, perfected and absolute assignment; provided, however, that the
Secured Party shall not have the right to enforce the provisions of any Assigned
Agreement until an Event of Default shall have occurred and be
continuing. During the continuance of any such Event of Default, the
Secured Party may, without affecting any other right or remedy available to it
and without releasing the Assignor from any of its duties or obligations under
the Assigned Agreements, exercise its rights under this Assignment as provided
herein and in the Loan Documents in any manner permitted by law. If
any notice to the Assignor is required by law, such notice shall be deemed
commercially reasonable if given at least ten (10) days prior to the date of
intended action.
All
rights of the Secured Party and the security interests granted to the Secured
Party hereunder, and all obligations of the Assignor hereunder, shall be
absolute and unconditional, irrespective of (a) any failure of the Secured
Party, the Administrative Agent or any Lender to assert any claim or demand or
to enforce any right or remedy against any other Loan Party, any other Person or
any other collateral under the provisions of the other Loan Documents or
otherwise, (b) any change in the time, manner or place of payment of, or in any
other term of, all or any of the Obligations or any other extension, compromise
or renewal of any of the Obligations, (c) any reduction, limitation, impairment
or termination of any Obligations for any reason other than indefeasible payment
in full of the Obligations, including any claim of waiver,
2
release,
surrender, alteration or compromise, and shall not be subject to (and the
Assignor hereby waives any right to or claim of) any defense or setoff,
counterclaim, recoupment or termination whatsoever by reason of the invalidity,
illegality, nongenuineness, irregularity, compromise, unenforceability of, or
any other event or circumstance affecting, any Obligations, (d) any amendment
to, recission, waiver or other modification of, or any consent to departure
from, any of the terms of the Loan Agreement or any other Loan Document, (e) any
addition, exchange, release, surrender or non-perfection of any collateral
(including the Collateral), or any amendment to or waiver or release of or
addition to or consent to departure from any guaranty, for any of the
Obligations, or (f) any other circumstances which might otherwise constitute a
defense available to, or a legal or equitable discharge of, the Assignor or any
other Loan Party other than full and indefeasible payment of the
Obligations.
This
Assignment may be effectively waived, modified, amended or terminated only by a
written instrument executed by the Secured Party and the
Assignor. Any waiver by the Secured Party shall be effective only
with respect to the specific instance described therein. Delay or
course of conduct shall not constitute a waiver of any right or remedy of the
Secured Party.
THIS
ASSIGNMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE
INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS
5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW
YORK). This Assignment and the other Loan Documents constitute the
entire understanding among the parties hereto with respect to the subject matter
hereof and thereof and supersede any prior agreements, written or oral, with
respect thereto.
The
provisions of Articles V and VI of the Security Agreement dated of even date
herewith among Assignor, the other Borrowers and the Secured Party are hereby
incorporated by reference into this Assignment.
The
Assignor acknowledged and agrees that this Assignment is a Collateral
Document.
3
IN
WITNESS WHEREOF, the undersigned has executed and delivered this Assignment as
of the date first written above, pursuant to proper authority duly
granted.
[NAME OF BORROWER PARTY TO THE
ASSIGNED AGREEMENTS], as Assignor
By: _____________________
Name:
___________________
Title:
____________________
SIGNATURE
PAGE TO COLLATERAL ASSIGNMENT AND CONSENT
BANC OF
AMERICA LEASING & CAPITAL, LLC,
not in
its individual capacity but solely as Collateral Agent
By: _______________________
Name:
_____________________
Title:
______________________
SIGNATURE PAGE TO COLLATERAL ASSIGNMENT AND CONSENT
Schedule
1
Exhibit
A
FORM OF ACKNOWLEDGMENT OF
AND CONSENT TO ASSIGNMENT
The undersigned, [______________]
(“Contract
Party”) hereby acknowledges notice of, and consents to the terms and
provisions of, the foregoing Collateral Assignment of Agreements, dated as of
[____________, 2007] (the “Assignment”), made by
[NAME OF BORROWER PARTY TO ASSIGNED AGREEMENTS], a _____________ corporation
(“Assignor”) in
favor of Banc of America Leasing & Capital LLC, not in its individual
capacity but solely as Collateral Agent (“Secured Party”),
pursuant to which Assignor assigned to Secured Party, as
security under that certain Term Loan Agreement dated as of
_______________, 2007 among ThermaClime, Inc., Assignor and certain of their
Affiliates, as borrowers, each lender from time to time party thereto (the
“Lenders”),
Banc of America Leasing & Capital, LLC, as administrative agent (the “Administrative
Agent”), Bank of Utah as payment agent, and Secured Party (the “Loan Agreement”), all
of its right, title and interest in, to and under the [____________] (the “Agreement”), which
rights may not be enforced by Secured Party unless an Event of Default occurs
and is continuing, and Contract Party hereby agrees with Secured Party
that:
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|
(a)
|
Secured
Party shall be entitled to exercise any and all rights and remedies of
Contract Party under the Assigned Agreement in accordance with the terms
of the Agreement, and Contract Party shall comply in all respects with
such exercise,
|
|
|
(b)
|
upon
receipt of written notice from Secured Party, Contract Party will pay to
Secured Party all amounts due under or in connection with the Assigned
Agreement, and
|
|
|
(c)
|
the
undersigned will not, without the prior written consent of Secured Party,
(i) cancel or terminate the Assigned Agreement or consent to or accept any
cancellation or termination thereof, or (ii) amend or otherwise modify the
Assigned Agreement.
|
The
Contract Party agrees to look solely to Assignor for the performance of all of
the obligations of Assignor under the Agreement. The undersigned
parties agree that neither the Secured Party, the Administrative Agent, any
Lender (as defined in the Assignment) nor any of their respective successors and
assigns is personally liable for, or required to assume any claims or
obligations incurred under the Agreement. If any Person including any
Lender purchases the rights of Secured Party under the Assignment with respect
to the Agreement upon foreclosure or otherwise or accepts such rights in
satisfaction of an attendant debt, such person or entity may be required upon or
following such purchase to agree to be bound by the terms and conditions of the
Agreement and to become subject to the obligations and liabilities of Assignor
arising under the Agreement following such purchase or acceptance, and such
person or entity shall have all rights and benefits of Assignor under the
Agreement.
In the
event Assignor becomes the subject of any bankruptcy or other insolvency
proceeding and the Agreement is rejected or terminated as a result of such
proceeding, the Contract Party agrees upon the request of the Administrative
Agent to enter into a new agreement with Secured Party or its designated
assignee on the same terms and conditions for the
remaining
term of the Agreement, provided that Secured Party or its designated assignee
has complied with all of its obligations set forth in this Acknowledgement of
and Consent to Assignment.
Subject
to the terms and conditions hereof, Secured Party shall have the right upon the
receipt by Contract Party of written notice from Secured Party that Secured
Party is exercising, or has exercised, its remedies (a “Notice of Exercise”),
to assign or sell Assignor’s rights under the Agreement to one or more
purchaser(s) or assignee(s) (a “Successor”). Contract
Party agrees that it will not charge any fee or other amount in connection with
such assignment or sale.
The
foregoing is furnished for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by Contract Party, and Contract
Party understands that the foregoing may and shall be relied upon by Secured
Party and by the Lenders, as a condition to the extension of credit to be
evidenced thereby.
This
Acknowledgement of and Consent to Assignment shall be binding upon Contract
Party and its successors and assigns, and shall inure, together with the rights
and remedies of Secured Party hereunder, to the benefit of Secured Party and its
successors, transferees and assigns. THIS ACKNOWLEDGMENT OF AND CONSENT TO
ASSIGNMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL
LAWS OF THE STATE OF NEW YORK.
IN
WITNESS WHEREOF, Contract Party has duly executed this Acknowledgement of and
Consent to Assignment as of the date set opposite its name below.
Dated:
_________________, 2007 [NAME OF
CONTRACT PARTY],
a
_________________________
By: __________________________
Name: ________________________
Title: _________________________
EXHIBIT
H-1
RECORDING
REQUESTED
BY )
AND WHEN
RECORDED MAIL TO: )
Banc of
America Leasing & Capital LLC )
Bank of
America
)
MA5-100-32-01 )
000
Xxxxxxx
Xx. )
Xxxxxx,
XX
00000 )
Attn.:
Xxxxxxxxx X. Xxxxxx,
VP )
Group
Operations
Manager )
Loan No.:
______________________ )
)
)
Space above for Recorder's
Use
ASSIGNMENT
OF LEASES AND RENTS AND SUBORDINATION AGREEMENT
THIS ASSIGNMENT OF LEASES AND RENTS
AND SUBORDINATION AGREEMENT (this "Assignment") is made
as of ____________________, by and among CHEROKEE NITROGEN HOLDINGS, INC., an
Oklahoma corporation, as assignor ("Assignor"), with a
mailing address at 00 X. Xxxxxxxxxxxx, Xxxxxxxx Xxxx, Xxxxxxxx 00000, Attention:
____________________, and CHEROKEE NITROGEN COMPANY, an Oklahoma
corporation (“Lessee”) with a
mailing address at 00 X. Xxxxxxxxxxxx, Xxxxxxxx Xxxx, Xxxxxxxx 00000,
Attention ___________________________ in favor of BANC OF AMERICA
LEASING & CAPITAL LLC, as collateral agent for the Lenders (hereinafter
called the “Assignee” or the
“Collateral
Agent”), whose address is c/o Xxxxxxxxx X. Xxxxxx, VP; Group Operations
Manager, Bank of America, MA5-100-32-01, 000 Xxxxxxx Xx., Xxxxxx, XX
00000.
RECITALS:
A. WHEREAS, upon the terms and
conditions of a certain Term Loan Agreement, dated as of the date hereof
(collectively, such agreement, as amended, restated, supplemented or otherwise
modified from time to time, being hereinafter referred to as the “Loan Agreement”), by
and among ThermaClime, Inc., an Oklahoma corporation (“ThermaClime”),
Assignor, Northwest Financial Corporation, an Oklahoma corporation, Chemex I
Corp., an Oklahoma corporation, Chemex II Corp, an Oklahoma corporation,
Cherokee Nitrogen Company, an Oklahoma corporation, ClimaCool Corp., an Oklahoma
corporation, ClimateCraft, Inc., an Oklahoma corporation, Climate Master, Inc.,
a Delaware corporation, DSN Corporation, an Oklahoma corporation, El Dorado
Chemical Company, an Oklahoma corporation, International Environmental
Corporation, an Oklahoma corporation, Koax Corp., an Oklahoma corporation, LSB
Chemical Corp., an Oklahoma corporation, The Climate Control Group, Inc., an
Oklahoma corporation, Trison Construction, Inc., an Oklahoma corporation,
ThermaClime Technologies, Inc., an Oklahoma corporation, and XpediAir, Inc., an
Oklahoma corporation, as borrowers (individually and collectively, jointly and
severally, “Borrower” or “Borrowers”), LSB
Industries, Inc., as guarantor, Banc of America Leasing & Capital, LLC, as
administrative agent (the “Administrative
Agent”), the Collateral Agent and the Lenders from time to time party
thereto (the “Lenders”;
collectively with the Administrative Agent and the Collateral Agent, the “Secured Parties”),
Secured Parties have agreed to provide certain financial accommodations (the
“Loan”) to
Borrowers, upon the terms and conditions set forth in the Loan Agreement and the
other Loan Documents.
B. The
Loan is secured by that certain Mortgage, Assignment of Rents and Security
Agreement and Fixture Filing (the "Mortgage"), dated as
of the date of this Assignment, from Assignor, as ‘mortgagor”, for the benefit
of Assignee, as “mortgagee, encumbering real property located in the County of
Colbert, State of Alabama, as described on Exhibit A
attached hereto, and all buildings and other improvements now or hereafter
located thereon (collectively, the "Improvements") (the
real property and the Improvements are hereinafter sometimes collectively
referred to as the "Property");
C. The
Loan Documents (as defined in the Loan Agreement) include the Mortgage, one or
more promissory note(s) (each and collectively, the “Note”) and all other
documents evidencing, securing or otherwise pertaining to the
Loan. This Assignment is one of the Loan Documents;
D. Assignor and
Lessee are parties to the following lease agreement:
Industrial
Plant Lease effective as of January 1, 2004 by and between Assignor as “Lessor”
and Lessee as “Lessee”
(the
“Lease”), pursuant to which Lessee leases from Assignor certain real property
legally described on the attached Exhibit A and certain
improvements located thereon (the “Premises”). All rights of Assignee
with respect to the Property set forth herein are understood and agreed to
include and extend to the Premises and any portion thereof. The
Premises is or will be encumbered by the Mortgage securing the Loan in favor of
Assignee. Lessee has agreed to recognize the rights of Assignee in
accordance with the terms and provisions of this Assignment; and
E. As
a condition to making the Loan to Borrowers, Assignee has required that Assignor
and Lessee execute and deliver this Assignment to further secure payment and
performance of Assignor's obligations under the Loan Documents.
NOW, THEREFORE, to induce Assignee to
enter into the Loan Documents and to make the Loan, and in consideration thereof
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, Assignor and Lessee hereby covenant and agree for
the benefit of Assignee, as follows:
Covenants of Assignor with
respect to Assignment:
1. Absolute
Assignment. Assignor hereby absolutely and presently assigns
to Assignee the following:
(a) All
of Assignor's right, title and interest in, to and under the Lease, including
(i) all guaranties of and security for Lessee’s performance under the Lease, and
(ii) all amendments, extensions, renewals or modifications to the lease;
and
(b) All
deposits (whether for security or otherwise), rents, issues, profits, revenues,
royalties, rights, benefits and income of and from the Property, including
liquidated damages following default and all proceeds payable under any policy
of insurance covering loss of rents, together with the continuing right to
collect and receive the same, and together with all rights and claims that
Assignor may have against any party under the Lease or against any other
occupant of the Property (collectively, the "Rents").
THIS IS
AN ABSOLUTE ASSIGNMENT, NOT AN ASSIGNMENT FOR SECURITY ONLY.
2
2. Grant of
License. Assignee hereby confers upon Assignor a license (the
"License") to
collect and retain the Rents as they become due and payable, so long as no Event
of Default (as defined in the Mortgage) shall exist and be
continuing. If an Event of Default has occurred and is continuing,
Assignee shall have the right, which it may choose to exercise in its sole
discretion, to terminate the License without notice to or demand upon Assignor,
and without regard to the adequacy of Assignee's security under the Loan
Documents.
3. Collection and Application
of Rents. Subject to the License granted to Assignor
under Section 2 above,
Assignee has the right, power and authority to collect any and all Rents after
the occurrence and during the continuance of an Event of
Default. Assignor hereby appoints Assignee its attorney-in-fact,
which power of attorney is with full power of substitution and coupled with an
interest, after the occurrence and during the continuance of an Event of Default
to perform any and all of the following acts as Assignee, in its sole
discretion, may elect:
(a) Demand,
receive and enforce payment of any and all Rents;
(b) Give
receipts, releases and satisfactions for any and all Rents; or
(c) Xxx
either in the name of Assignor or in the name of Assignee for any and all
Rents.
Assignee may, in its sole discretion,
choose to collect Rents either with or without taking possession of the
Property. Even if Assignee is collecting and applying Rents as
permitted under this Assignment, Assignee shall still be entitled, upon an Event
of Default, to exercise and invoke every right and remedy provided to it under
this Assignment, the Mortgage, or under any of the other Loan
Documents.
Covenants of Lessee,
Assignee and Assignor with respect to Subordination:
4. Subordination. Notwithstanding
anything to the contrary contained in the Lease, the Lease and the leasehold
estate created thereby are hereby declared to be, and hereafter shall continue
at all times to be, junior, subject and subordinate, in each and every respect,
to the Mortgage, including, without limitation, (i) any and all increases,
renewals, modifications, extensions, substitutions, replacements and or
consolidations of the Note or the Mortgage and (ii) any future mortgage or
encumbrance affecting the Premises held by or made for the benefit of Assignee
and/or its successors and assigns. The foregoing subordination is
effective and self-operative without the necessity for execution of any further
instruments. Lessee hereby covenants with Assignee that Lessee will
not cause the Lease to be subordinated to any interests other than those held by
or made for the benefit of Assignee and/or its successors and assigns without
prior written notice to and prior written consent of Assignee. At any
time at the election of Assignee, Assignee shall have the right to declare the
Lease superior to the lien, provisions, operation and effect of the
Mortgage.
5. Attornment; Right of
Termination.
a) Notwithstanding the foregoing
subordination, if the interest of Assignor under the Lease shall be transferred
by reason of foreclosure or other proceedings (judicial or non judicial) for
enforcement of the Mortgage or by reason of a deed in lieu of foreclosure (any
of the foregoing being a “Transfer Event”) , Lessee, at the election of the
transferee and its successors and assigns (the “Purchaser”) acquiring said
interests, shall be bound to the Purchaser pursuant to all of the terms,
covenants and conditions of the Lease for the balance of the term of the Lease
then remaining and any extensions or renewals thereof which may be effected in
accordance with any option therefor in the Lease, with the same force and effect
as if the Purchaser were the original Assignor under the Lease,
3
and
Lessee does hereby attorn to and agree to attorn to the Purchaser, as its
Assignor, said attornment to be effective and self-operative without the
necessity for execution of any further instruments, upon Purchaser’s election
after succeeding to the interest of the Assignor under the Lease.
b) Purchaser
shall have the right, at any time immediately upon and after the occurrence of a
Transfer Event, to terminate the Lease upon written notice to Lessee and
Assignor (“Notice of Termination”), which Notice of Termination shall set forth
the date on which such termination shall be effective.
6. Further
Acts. Notwithstanding any provisions contained in Sections 4 and 5 above which state
that the attornment and subordination by Lessee to Assignee and Purchaser are
effective and self-operative without the execution of any further instrument,
Lessee agrees that, upon request of Assignee and/or Purchaser, it will execute
such written agreement to evidence and affirm any and all of Lessee’s
obligations under this Assignment, and further, Lessee agrees that it will
execute from time to time such further assurances and estoppel certificates as
may reasonably be requested by Assignee and Purchaser. Without
limiting the generality of the foregoing, if and to the extent that Assignor
rejects the Lease in any federal or state proceeding, Lessee will, upon the
request of Assignee or Purchaser after exercise by Assignee of its remedies in
enforcement of the Mortgage, immediately enter into a new lease directly with
the Assignee or Purchaser on the same terms as the Lease (for the then-unexpired
term of the Lease), provided execution of such new lease does not violate any
bankruptcy law or related court order.
7. Limitation. Neither
Assignee nor any Purchaser shall be (a) liable for any act or omission of
Assignor or any prior Assignor (including the loss or misappropriation of any
rental payments or security deposits); (b) subject to any credits, claims,
setoffs, offsets or defenses which Lessee may have against Assignor or any prior
Assignor; (c) bound by (or responsible for) any advance payment of rent or any
other monetary obligations under the Lease to Assignor in excess of one month’s
prepayment thereof in the case of rent, or in excess of one periodic payment in
advance in the case of any other monetary obligations under the Lease; (d)
responsible for any security deposit not actually received by Assignee or any
Purchaser; (e) bound by any amendment, assignment (in whole or in part),
subletting, extension, renewal or modification of the Lease to which Assignee or
Purchaser has not consented in writing (to the extent such consent by Assignee
is required under the Loan Documents), and any attempted amendment, assignment
(in whole or in part), subletting, extension, renewal or modification of the
Lease without said consent (to the extent such consent by Assignee is required
under the Loan Documents) shall be null and void and of no force and effect;
provided, however, that the consent of the Assignee or Purchaser is not required
for (i) an assignment or subletting entered into pursuant to such provision of
the Lease as shall expressly provide that Lessee may effect such assignment or
subletting without the consent of Assignor or (ii) an extension of the term of
such Lease; (f) liable for latent and/or patent defects in the construction of
the Premises; (g) liable for any breach of any warranty in the Lease by Assignor
or a prior Assignor; (h) bound by any obligation to repair, replace, rebuild or
restore the Premises, or any part thereof, in the event of damage by fire or
other casualty, or in the event of partial condemnation, beyond such repair,
replacement, rebuilding or restoration as may be required of the Assignor under
the Lease and as can reasonably be accomplished with the use of the net
insurance proceeds or the net condemnation award actually received by or made
available to Assignee (as successor in interest to Assignor) or Purchaser; (i)
required to remove any person occupying the Premises or any part thereof; or (j)
bound by any right of first refusal or right of first offer set forth in the
Lease. Neither Assignee nor any Purchaser shall be liable for any
reason for amounts in excess of the value of its interest in the Premises, or
for consequential or punitive damages of any kind
8. Notice; Cure;
Waivers. Lessee agrees to give prompt written notice to
Assignee (and to any successor in interest to Assignee of which Lessee has been
notified) of any uncured default of the
4
Assignor
under the Lease if such default is of such a nature as to give Lessee a right to
terminate the Lease, reduce rent or to credit or offset any amounts against
future rents. If, within thirty (30) days after receipt of written
notice from Lessee, Assignee, at Assignee’s sole option, cures (or commences and
is diligently pursuing the cure of) a default of Assignor under the Lease that
is capable of being cured by Assignee, Lessee agrees not to terminate the Lease,
reduce rent, credit or offset against future rents, consent or acquiesce in the
termination of the Lease or surrender the Premises and agrees to continue to be
bound by the terms of the Lease and this Assignment. To the extent
that Assignee is only able to effect cure of such default after taking
possession of the Premises or exercising its right to foreclosure under the
mortgage, Lessee agrees that the time for cure of such default by Assignee shall
be extended for the time reasonably required to obtain such possession or effect
such foreclosure.
9. Payments of Rent to
Assignee. Assignor absolutely assigns to Assignee all payments
of rent as the same are due under the Lease (the “Rent”) and Lessee agrees that
within thirty (30) days after notice delivered to Lessee of an uncured Event of
Default (as defined in the Mortgage) by the Assignee and until such time as all
of Assignor’s monetary obligations to Assignee pursuant to the Note and the Loan
Agreement between Assignee and Borrowers have been fully paid or such Event of
Default has been cured (and Assignee and Lessee shall have notice of such cure),
Lessee will pay the Rent directly to Assignee. All such rental
payments received by Assignee shall be credited against Assignor’s obligations
to Assignee. Assignor, by its execution hereof, agrees that this
Assignment does not constitute a waiver by Assignee of any of Assignee’s rights
under the Mortgage and any assignment of leases or rents contained therein, or
in a separate instrument or in any way release the Assignor from any of the
terms, conditions, obligations, covenants and agreements of the
Mortgage.
10. Notices. All
notices, consents, approvals or other instruments required or permitted to be
given by any party pursuant to this Assignment shall be in writing and given by
(i) hand delivery, (ii) express overnight delivery service or (iii) certified or
registered mail, return receipt requested, and shall be deemed to have been
delivered upon (a) receipt, if hand delivered, (b) the next business day, if
delivered by express overnight delivery service, or (c) the third business day
following the day of deposit of such notice with the United States Postal
Service, if sent by certified or registered mail, return receipt
requested. Notices shall be provided to the parties and addresses (or
facsimile numbers, as applicable) as set forth in the introductory paragraph
hereto.
11. Remedies of
Assignee. Upon or at any time after the occurrence and during
the continuance of an Event of Default, (i) Assignee may, at its option, without
waiving such Event of Default and without regard to the adequacy of Assignee's
security under the Loan Documents, either in person, by agent, or by a receiver
appointed by a court, take possession of the Property and hold, manage, lease
and operate the Property on such terms and for such period of time as provided
in the Mortgage, (ii) Assignee may, with or without taking possession of the
Property, in its own name, demand, xxx for or otherwise collect and receive all
Rents, including those past due and unpaid, (iii) Assignee shall have full power
to make all alterations, renovations, repairs or replacements and to do any and
all other things which it may in its sole discretion consider necessary or
appropriate to protect the security of this Assignment and under the Mortgage,
and (iv) Assignee may apply the Rents to pay any of the following amounts and in
such order as provided in the Mortgage: (a) the Secured
Obligations (as defined in the Mortgage); (b) all expenses of the Property,
including the salaries, fees, commissions and wages of a managing agent and such
other employees, agents or independent contractors as Assignee deems necessary
or desirable; (c) all taxes, charges, claims, assessments, or any other
liens against the Property; (d) all premiums for all insurance Assignee
deems necessary or desirable; (e) the cost of all alterations, renovations,
repairs or replacements; and (f) all expenses incident to taking and
retaining possession of the Property. Neither the demand for nor
collection of Rents by Assignee shall constitute any assumption by Assignee of
any obligation under the lease. Assignee is obligated to account only
for such Rents as are actually collected or received by Assignee. For
purposes of this Section, Assignor
5
grants to
Assignee its irrevocable power of attorney, with full power of substitution and
coupled with an interest, to take any and all of the aforementioned actions for
the proper management and preservation of the Property. Assignee
shall, as a matter of absolute right, be entitled, upon application to a court
of applicable jurisdiction, to the appointment of a receiver to obtain and
secure the rights of Assignee hereunder and the benefits intended to be provided
to Assignee under this Assignment. The exercise by Assignee of the
option granted it in this Section and the collection of the Rents and the
application thereof as provided in this Assignment shall not be considered a
waiver of any Event of Default by Assignor under the note(s), the Mortgage, this
Assignment or the other Loan Documents. This Assignment shall remain
in full force and effect during any period of foreclosure and/or redemption with
respect to the Property.
12. No Liability of
Assignee. Assignee shall not be liable for any loss sustained
by Assignor resulting from Assignee’s failure to lease any part of the Property
or from any other act or omission of Assignee in managing the Property after an
Event of Default, other than acts or omissions of Assignee constituting willful
misconduct or gross negligence of Assignee. Assignee shall not be
responsible for performing any of Assignor's obligations under the lease by
reason of this Assignment. Assignor hereby agrees to indemnify,
defend and hold Assignee harmless for, from and against any and all liability,
loss or damage which may be incurred under the lease or by reason of this
Assignment and from any and all claims and demands whatsoever, including the
defense of any such claims or demands which may be asserted against Assignee by
reason of any alleged obligations and undertakings on its part to perform or
discharge any of the terms, covenants or agreements contained in the
lease. Should Assignee incur any such liability, Assignor shall
reimburse Assignee promptly upon demand. This Assignment shall not
operate to place any obligation or liability for the control, care, management
or repair of the Property upon Assignee, nor shall it operate to make Assignee
responsible or liable for any waste committed on the Property by any lessee or
any other party, any dangerous or defective condition of the Property,
including, without limitation, the presence of any Hazardous Substances (as
defined in the Loan Agreement), or for any negligence in the management, upkeep,
repair or control of the Property resulting in loss or injury or death to any
lessee, licensee, employee or stranger, other than acts or omissions of Assignee
constituting gross negligence or willful misconduct of Assignee.
13. Other
Security. Assignee may take or release other security for the
payment of the Secured Obligations, may release any party primarily or
secondarily liable therefor and may apply any other security held by it to the
reduction or satisfaction of the Secured Obligations without prejudice to any of
its rights under this Assignment.
14. Other
Remedies. Assignor has executed the Mortgage which contains an
Assignment of Rents and Leases assigning to Assignee all of Assignor's right,
title and interest, as Assignor, in and to the lease. All rights and
remedies granted to Assignee under the Assignment of Rents and Leases contained
in the Mortgage shall be in addition to all rights and remedies granted to
Assignee under this Assignment. The right of Assignee to collect the
Secured Obligations and to enforce any other security held by Assignee may be
exercised by Assignee either prior to, simultaneously with, or subsequent to any
action taken by it under this Assignment.
15. No Mortgagee in
Possession. Nothing contained in this Assignment shall be
construed as constituting Assignee a "mortgagee in possession" for any
purpose.
16. Conflict of
Terms. In case of any conflict between the terms of this
Assignment and the terms of the Mortgage, the terms of the Mortgage shall
prevail.
17. Non-Waiver. Each
waiver by any Assignee must be in writing, and no waiver shall be construed as a
continuing waiver. No waiver shall be implied from any delay or failure by
Assignee to
6
take
action on account of any default of Assignor. Consent by Assignee to any
act or omission by Assignor shall not be construed as a consent to any other or
subsequent act or omission or to waive the requirement for Assignee's consent to
be obtained in any future or other instance. No collection by
Assignee of any Rents pursuant to this Assignment shall constitute or result in
a waiver of any default then existing under this Assignment or under any of the
other Loan Documents.
18. Invalid
Provisions. A determination that any provision of this
Assignment 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 Assignment 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.
19. Governing
Law. This Assignment shall be governed by and construed in
accordance with the laws of the state where the Property is located, except to
the extent any of such laws may now or hereafter be preempted by Federal
law.
20. Termination of
Assignment. Upon payment in full of the Secured Obligations
and the delivery and recording of a satisfaction, release, reconveyance or
discharge of the Mortgage duly executed by Assignee, this Assignment shall
become and be void and of no effect.
21. Successors in Interest;
Transfer of Loan. The terms, covenants and conditions of this
Assignment shall be binding upon and inure to the benefit of the heirs,
successors and assigns of the parties. Assignee and any successor may, at
any time, sell, transfer, or assign the Loan, this Assignment and the other Loan
Documents, and any or all servicing rights with respect thereto, or grant
participations therein or issue mortgage pass-through certificates or other
securities evidencing a beneficial interest in a rated or unrated public
offering or private placement (the "Securities"). Assignee
may forward to each Assignee, transferee, assignee, servicer, participant,
investor in such Securities or any rating agency (a "Rating Agency")
rating such Securities (all of the foregoing entities collectively referred to
as an "Investor") and each
prospective Investor, all documents, financial and other information which
Assignee now has or may hereafter acquire relating to (a) the Loan; (b) the
Property and its operation (including, without limitation, copies of all leases,
subleases or any other agreements concerning the use and occupancy of the
Property); and/or (c) any party connected with the Loan (including, without
limitation, Assignor, any partner or member of Assignor, any constituent partner
or member of Assignor, and any guarantor). In connection with such
Securities, Assignor further agrees that the Loan Documents shall be sufficient
evidence of the obligations of Assignor to each
Investor. Assignor shall, within fifteen (15) days after
request by Assignee, deliver an estoppel certificate verifying for the benefit
of Assignee and any other party designated by Assignee the status and the terms
and provisions of the Loan in form and substance acceptable to
Assignee. The representations, warranties, obligations, covenants,
and indemnity obligations of Assignor under the Loan Documents shall also
benefit and apply with respect to any Assignee, transferee, assignee,
participant, servicer or investor.
22. Attorneys'
Fees. If any lawsuit, suit or proceeding is commenced which
arises out of or relates to the Loan Agreement, this Assignment, the other Loan
Documents or the Loan, the prevailing party shall be entitled to recover from
each other party such sums as the court may adjudge to be reasonable attorneys'
fees in the action, in addition to costs and expenses otherwise allowed by
law. In all other situations, including any matter arising out of or
relating to any proceeding under any Debtor Relief Law (as defined in the
Mortgage), Assignor agrees to pay all of Assignee's costs and expenses,
including attorneys' fees, which may be incurred in enforcing or protecting
Assignee's rights or interests. From the time(s) incurred until paid
in full to Assignee, all such sums shall bear interest at the Default
Rate. Whenever Assignor is obligated to pay or reimburse Assignee for
any attorneys' fees, those fees shall include the allocated costs for services
of in-house counsel.
7
23. Execution in
Counterparts
. This
Assignment may be executed in any number of counterparts, each of which shall be
deemed to be an original, and all of such counterparts shall constitute one
Agreement
24. WAIVER OF TRIAL BY
JURY. ASSIGNOR HEREBY AGREES NOT TO ELECT A TRIAL BY JURY OF
ANY ISSUE TRIABLE OF RIGHT BY JURY, AND WAIVES ANY RIGHT TO TRIAL BY JURY FULLY
TO THE EXTENT THAT ANY SUCH RIGHT SHALL NOW OR HEREAFTER EXIST WITH REGARD TO
THE LOAN, THE LOAN DOCUMENTS, OR ANY CLAIM, COUNTERCLAIM OR OTHER ACTION ARISING
IN CONNECTION THEREWITH. THIS WAIVER OF RIGHT TO TRIAL BY JURY IS
GIVEN KNOWINGLY AND VOLUNTARILY BY ASSIGNOR, AND IS INTENDED TO ENCOMPASS
INDIVIDUALLY EACH INSTANCE AND EACH ISSUE AS TO WHICH THE RIGHT TO A TRIAL BY
JURY WOULD OTHERWISE ACCRUE. ASSIGNEE IS HEREBY AUTHORIZED TO FILE A
COPY OF THIS PARAGRAPH IN ANY PROCEEDING AS CONCLUSIVE EVIDENCE OF THIS WAIVER
BY ASSIGNOR.
8
IN WITNESS WHEREOF, Assignor, Lessee
and Assignee have executed this Assignment as of the day and year first above
written.
ASSIGNOR:
CHEROKEE
NITROGEN HOLDINGS, INC.,
an
Oklahoma corporation
By: _______________________________
Name: _____________________________
Title: ______________________________
LESSEE:
CHEROKEE
NITROGEN COMPANY,
an
Oklahoma corporation
By:
________________________________
Name: ______________________________
Title: _______________________________
ASSIGNEE:
BANC OF
AMERICA LEASING & CAPITAL, LLC,
By:
________________________________
Name: ______________________________
Title:
_______________________________
EXHIBIT A
LEGAL
DESCRIPTION
[ACKNOWLEDGEMENT]
STATE
OF _________________)
)
COUNTY
OF _______________)
On
____________________, before me, _________________________, a Notary Public in
and for the State of ____________________, personally appeared
_________________________, personally known to me (or proved to me on the basis
of satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to
the within instrument and acknowledged to me that he/she/they executed the same
in his/her/their authorized capacity(ies), and that by his/her/their
signature(s) on the instrument the person(s), or the entity upon behalf of which
the person(s) acted, executed the instrument.
WITNESS
my hand and official seal.
_______________________________ [SEAL]
EXHIBIT
H-2
INTERCOMPANY
LOAN SUBORDINATION AGREEMENT
THIS
INTERCOMPANY LOAN SUBORDINATION AGREEMENT (this “Agreement”), dated as
of _____________, 2007, is made among LSB INDUSTRIES, INC. (“Parent”), the
Borrowers (as defined hereinafter) and BANC OF AMERICA LEASING & CAPITAL
LLC, as collateral agent (in such capacity, together with its successors, if
any, in such capacity, “Collateral Agent”)
for the Secured Parties (as defined hereinafter).
WHEREAS,
Parent, Cherokee Nitrogen Holdings, Inc. (“Cherokee”),
ThermaClime, Inc., an Oklahoma corporation (“ThermaClime”), and
the subsidiaries of ThermaClime party to this Agreement (each of Cherokee,
ThermaClime and each such subsidiary is herein referred to as a “Borrower” and
Cherokee, ThermaClime and all such subsidiaries are herein referred to,
collectively, as the “Borrowers”), Banc of
America Leasing & Capital, LLC, as administrative agent (“Administrative
Agent”) and as Collateral Agent, Bank of Utah, as payment agent (“Payment Agent”) and
the lenders from time to time party thereto (the “Lenders”;
collectively with the Administrative Agent, the Collateral Agent and the Payment
Agent, the “Secured
Parties”) are parties to that certain Term Loan Agreement dated as of
even date herewith (as amended, modified, renewed, extended, or replaced from
time to time, the “Loan Agreement”),
pursuant to which the Secured Parties have agreed to make certain financial
accommodations to the Borrowers;
WHEREAS,
Parent and each Borrower (collectively, the “Loan Parties” and
each a “Loan
Party”) has made or may make from time to time loans or advances (the
“Intercompany
Loans”) to one or more of Parent or the other Borrowers; and
WHEREAS,
each Loan Party has agreed to the subordination of the Intercompany Loans, upon
the terms and subject to the conditions set forth in this
Agreement;
NOW,
THEREFORE, in consideration of the mutual promises, covenants, conditions,
representations, and warranties set forth herein and for other good and valuable
consideration, the parties hereto agree as follows:
SECTION
1. Definitions;
Interpretation.
(a) Certain Defined
Terms. Capitalized terms used herein and not otherwise defined
herein shall have the meanings ascribed thereto in the Loan
Agreement. As used in this Agreement, the following terms shall have
the following meanings:
“Bankruptcy Code”
means title 11 of the United States Code, as in effect from time to
time.
“Insolvency
Proceeding” means any proceeding commenced by or against any Person under
any provision of the Bankruptcy Code or under any other state or federal
bankruptcy or insolvency law, assignments for the benefit of creditors, formal
or informal moratoria, compositions, extensions generally with creditors, or
proceedings seeking reorganization, arrangement, or other similar
relief.
“Senior Debt” means
the Obligations.
“Senior Loan
Documents” means the “Loan Documents” (as that term is defined in the
Loan Agreement).
“Subordinated Debt”
means, with respect to each Loan Party, all indebtedness, liabilities, and other
obligations for borrowed money of any other Loan Party owing to such Loan Party
in respect of any and all Intercompany Loans made by or such Loan Party to such
other Loan Party, whether now existing or hereafter arising, and whether due or
to become due, absolute or contingent, liquidated or unliquidated, determined or
undetermined, including all fees and all other amounts payable by any other Loan
Party to such Loan Party under or in connection with any documents or
instruments entered into to evidence the Intercompany Loans.
“Subordinated Debt
Payment” means any payment or distribution by or on behalf of any Loan
Party, directly or indirectly, of assets of such Loan Party of any kind or
character, whether in cash, property, or securities, including on account of the
purchase, redemption, or other acquisition of Subordinated Debt, as a result of
any collection, sale, or other disposition of collateral, or by setoff,
exchange, or in any other manner, for or on account of the Subordinated
Debt.
(b) Interpretation. Unless
the context of this Agreement clearly requires otherwise, references to the
plural include the singular, references to the singular include the plural, the
term “including” is not limiting, and the term “or” has, except where otherwise
indicated, the inclusive meaning represented by the phrase
“and/or.” The words “hereof,” “herein,” “hereby,” “hereunder,” and
similar terms in this Agreement refer to this Agreement as a whole and not to
any particular provision of this Agreement. Section, subsection,
clause, schedule, and exhibit references are to this Agreement unless otherwise
specified. References to agreements and other contractual instruments
shall be deemed to include all subsequent amendments and other modifications
thereto. References to statutes or regulations are to be construed as
including all statutory and regulatory provisions consolidating, amending, or
replacing the statute or regulation referred to. The captions and
headings are for convenience of reference only and shall not affect the
construction of this Agreement.
SECTION
2. Subordination to Payment of
Senior Debt.
As to
each Loan Party, all payments on account of the Subordinated Debt shall be
subject, subordinate, and junior, in right of payment and exercise of remedies,
to the extent and in the manner set forth herein, to the prior payment, in full,
in cash or cash equivalents of the Senior Debt.
SECTION
3. Subordination Upon Any
Distribution of Assets of Borrowers.
As to
each Loan Party and until the prior payment, in full, in cash or cash
equivalents of the Senior Debt, in the event of any payment or distribution of
assets of any other Loan Party of any kind or character, whether in cash,
property, or securities, upon an Insolvency Proceeding relating to such other
Loan Party or its property: (i) all amounts owing on account of
the Senior Debt shall first be paid, in full, in cash, or payment provided for
in cash or in cash
-2-
equivalents,
before any Subordinated Debt Payment is made; and (ii) to the extent
permitted by applicable law, any Subordinated Debt Payment to which such Loan
Party would be entitled except for the provisions hereof, shall be paid or
delivered by the trustee in bankruptcy, receiver, assignee for the benefit of
creditors, or other liquidating agent making such payment or distribution
directly to Collateral Agent for application to the payment of the Senior Debt
in accordance with clause (i), after giving effect to any concurrent payment or
distribution or provision therefor to Collateral Agent in respect of such Senior
Debt.
SECTION
4. Payments on Subordinated
Debt.
(a) Permitted
Payments. So long as no Event of Default has occurred and is
continuing, each Loan Party may make, and each other Loan Party shall be
entitled to accept and receive, payments on account of the Subordinated Debt, to
the extent such Indebtedness is permitted under the Loan Agreement and only if
such Loan Party is a party to this Agreement.
(b) No Payment Upon Senior Debt
Defaults. Upon the occurrence of any Event of Default, and
until such Event of Default is cured or waived, no Loan Party shall make, and no
other Loan Party shall accept or receive, any Subordinated Debt
Payment.
SECTION
5. Subordination of
Remedies.
As long
as any Senior Debt shall remain outstanding and unpaid, no Loan Party shall,
without the prior written consent of Collateral Agent:
(a) accelerate,
or otherwise make due and payable, or make demand prior to the original due date
thereof any Subordinated Debt or bring suit or institute any other actions or
proceedings to enforce its rights or interests in respect of the Subordinated
Debt of any other Loan Party owing to such Loan Party;
(b) exercise
any rights under or with respect to guaranties of the Subordinated Debt, if
any;
(c) exercise
any rights to set-offs (it being understood that an intercompany netting of
payments on the books of the Loan Parties in the ordinary course of business
shall not be deemed a set-off for purposes of this clause (c) so long as
no default has occurred and is continuing under the applicable Subordinated Debt
and no Event of Default has occurred and is continuing) and counterclaims in
respect of any indebtedness, liabilities, or obligations of such Loan Party to
any other Loan Party against any of the Subordinated Debt; or
(d) commence,
or cause to be commenced, or join with any creditor other than Collateral Agent
on behalf thereof in commencing, any bankruptcy, insolvency, or receivership
proceeding against the other Loan Party.
SECTION
6. Payment Over to Collateral
Agent.
In the
event that, notwithstanding the provisions of Sections 3, 4, and 5, any Subordinated
Debt Payments shall be received in contravention of any such Sections 3, 4, or 5 by any Loan Party
before all Senior Debt is paid in full, in cash or cash equivalents, such
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Subordinated
Debt Payments shall be held in trust for the benefit of Collateral Agent and
shall be paid over or delivered to Collateral Agent for application to the
payment, in full, in cash or cash equivalents, of all Senior Debt remaining
unpaid to the extent necessary to give effect to such Sections 3, 4, and 5, the application
thereof in accordance with the Senior Loan Documents and after giving effect to
any concurrent payments or distributions to Collateral Agent in respect of the
Senior Debt.
SECTION
7. Authorization to Collateral
Agent.
If, while
any Subordinated Debt is outstanding and until the Indefeasible Payment and
Performance of All Obligations has occurred, any Insolvency Proceeding shall
occur and be continuing with respect to another Loan Party or its
property: (i) Collateral Agent is hereby irrevocably authorized
and empowered (in the name of each Loan Party or otherwise), but shall have no
obligation, to demand, xxx for, collect, and receive every payment or
distribution in respect of the Subordinated Debt and give acquittance therefor
and to file claims and proofs of claim and take such other action (including
voting the Subordinated Debt) as it may deem necessary or advisable for the
exercise or enforcement of any of the rights or interests of the Secured
Parties; and (ii) each Loan Party shall promptly take such action as
Collateral Agent may reasonably request (A) to collect the Subordinated
Debt for the account of the Secured Parties and to file appropriate claims or
proofs of claim in respect of the Subordinated Debt, (B) to execute and
deliver to Collateral Agent such powers of attorney, assignments, and other
instruments as it may reasonably request to enable it to enforce any and all
claims with respect to the Subordinated Debt, and (C) to collect and
receive any and all Subordinated Debt Payments.
SECTION
8. Certain Agreements of Each
Loan Party.
(a) No
Benefits. Each Loan Party understands that there may be
various agreements between Collateral Agent or other Secured Parties and any
other Loan Party evidencing and governing the Senior Debt, and each Loan Party
acknowledges and agrees that such agreements are not intended to confer any
benefits on such Loan Party and that the Secured Parties and Collateral Agent
(on behalf thereof) shall have no obligation to such Loan Party or any other
Person to exercise any rights, enforce any remedies, or take any actions which
may be available to them under such agreements.
(b) No
Interference. Each Loan Party acknowledges that certain of the
Borrower have granted to Collateral Agent, for itself and for the benefit of the
Secured Parties, security interests in certain of such Borrower’s assets as set
forth in the Loan Agreement and the other Senior Loan Documents, and agrees not
to interfere with or in any manner oppose a disposition of any Collateral by
Collateral Agent on behalf thereof in accordance with applicable
law.
(c) Reliance by the Secured
Parties. Each Loan Party acknowledges and agrees that the
Secured Parties will have relied upon and will continue to rely upon the
subordination provisions provided for herein and the other provisions hereof in
entering into the Senior Loan Documents and making or issuing the Term Loans
thereunder.
-4-
(d) Waivers. Unless
otherwise expressly provided herein or under the Loan Agreement, each Loan Party
hereby waives any and all notice of the incurrence of the Senior Debt or any
part thereof and any right to require marshaling of assets.
(e) Obligations of Each Loan
Party Not Affected. Each Loan Party hereby agrees that at any
time and from time to time, without notice to or the consent of such Loan Party
except as otherwise provided in the Senior Loan Documents, without incurring
responsibility to such Loan Party, and without impairing or releasing the
subordination provided for herein or otherwise impairing the rights of
Collateral Agent or other Secured Parties hereunder: (i) the
time for any other Loan Party’s performance of or compliance with any of its
agreements contained in the Senior Loan Documents may be extended or such
performance or compliance may be waived by the Secured Parties or Collateral
Agent on behalf thereof; (ii) the agreements of any other Loan Party with
respect to the Senior Loan Documents may from time to time be modified by such
other Loan Party and the Secured Parties or Collateral Agent on behalf thereof;
(iii) the manner, place, or terms for payment of Senior Debt or any portion
thereof may be altered or the terms for payment extended, or the Senior Debt may
be renewed in whole or in part; (iv) the maturity of the Senior Debt may be
accelerated in accordance with the terms of any present or future agreement by
any other Loan Party and the Secured Parties or Collateral Agent on behalf
thereof; (v) any Collateral may be sold, exchanged, released, or
substituted and any Lien in favor of Collateral Agent for the benefit of the
Secured Parties may be terminated, subordinated, or fail to be perfected or
become unperfected; (vi) any Person liable in any manner for Senior Debt
may be discharged, released, or substituted; and (vii) all other rights
against any other Loan Party, any other Person, or with respect to any
Collateral may be exercised (or the Secured Parties or Collateral Agent (on
behalf thereof) may waive or refrain from exercising such rights).
(f) Rights of the Secured
Parties Not to Be Impaired. No right of the Secured Parties or
Collateral Agent, on behalf thereof, to enforce the subordination provided for
herein or to exercise its other rights hereunder shall at any time in any way be
prejudiced or impaired by any act or failure to act by any other Loan Party, the
Secured Parties or Collateral Agent hereunder or under or in connection with the
Senior Loan Documents or by any noncompliance by any other Loan Party with the
terms and provisions and covenants herein or in the Senior Loan Documents,
regardless of any knowledge thereof that the Secured Parties or Collateral Agent
may have or otherwise be charged with.
(g) Financial Condition of Loan
Parties. Unless otherwise expressly permitted under the Loan
Agreement, no Loan Party shall have a right to require the Secured Parties to
obtain or disclose any information with respect to: (i) the
financial condition or character of any other Loan Party or the ability of the
other Loan Party to pay and perform Senior Debt; (ii) the Senior Debt;
(iii) the Collateral or other security for any or all of the Senior Debt;
(iv) the existence or nonexistence of any guarantees of, or any other
subordination agreements with respect to, all or any part of the Senior Debt;
(v) any action or inaction on the part of the Secured Parties or any other
Person; or (vi) any other matter, fact, or occurrence
whatsoever.
(h) Acquisition of Liens or
Guaranties. Unless otherwise expressly permitted under the
Loan Agreement, no Loan Party shall, without the prior written consent of
Collateral
-5-
Agent,
acquire any right or interest in or to any Collateral not owned by such Loan
Party or accept any guaranties for the Subordinated Debt.
SECTION
9. Subrogation.
Until
the Indefeasible Payment and Performance of All Obligations has occurred, no
Loan Party shall have, or shall directly or indirectly exercise, any rights that
it may acquire by way of subrogation under this Agreement, by any payment or
distribution to the Secured Parties hereunder or otherwise. After the
Indefeasible Payment and Performance of All Obligations has occurred, each Loan
Party shall be entitled to exercise in full any subrogated rights it may possess
with respect to the rights of the Secured Parties to receive payments or
distributions applicable to the Senior Debt until the Subordinated Debt shall be
paid in full. For the purposes of the foregoing subrogation, no
payments or distributions to the Secured Parties of any cash, property, or
securities to which any Loan Party would be entitled except for the provisions
of Section 3,
4, or 5 shall, as among
such Loan Party, its creditors (other than the Secured Parties), and the other
Loan Parties, be deemed to be a payment by the other Loan Parties to or on
account of the Senior Debt.
SECTION
10. Continuing Agreement;
Reinstatement.
(a) Continuing
Agreement. This Agreement is a continuing agreement of
subordination and shall continue in effect and be binding upon each Loan Party
until the Senior Debt is paid and performed in full and the Loan Agreement is
terminated in accordance with its terms. The subordinations,
agreements, and priorities set forth herein shall remain in full force and
effect regardless of whether any party hereto in the future seeks to rescind,
amend, terminate, or reform, by litigation or otherwise, its respective
agreements with the other Loan Parties.
(b) Reinstatement. This
Agreement shall continue to be effective or shall be reinstated, as the case may
be, if, for any reason, any payment of the Senior Debt by or on behalf of any
Loan Party shall be rescinded or must otherwise be restored by Collateral Agent
or the Secured Parties, whether as a result of an Insolvency Proceeding or
otherwise.
SECTION
11. Transfer of Subordinated
Debt.
No Loan
Party may assign or transfer its rights and obligations in respect of the
Subordinated Debt, except to another Loan Party which is a party to this
Agreement, without the prior written consent of Collateral Agent and any such
transferee or assignee, as a condition to acquiring an interest in the
Subordinated Debt shall agree to be bound hereby, in form and substance
reasonably satisfactory to Collateral Agent.
SECTION
12. Obligations of Loan Parties
Not Affected.
The
provisions of this Agreement are intended solely for the purpose of defining the
relative rights of each Loan Party against the other Loan Parties, on the one
hand, and of the Secured Parties and Collateral Agent on behalf thereof against
the other Loan Parties, on the other hand. Nothing contained in this
Agreement shall (i) impair, as between each Loan Party and the other Loan
Parties, the obligation of the other Loan Parties to pay their respective
-6-
obligations
with respect to the Subordinated Debt as and when the same shall become due and
payable, or (ii) otherwise affect the relative rights of each Loan Party
against the other Loan Parties, on the one hand, and of the creditors (other
than the Secured Parties) of the other Loan Parties against the other Loan
Parties, on the other hand.
SECTION
13. Endorsement of Loan Party
Documents; Further Assurances and Additional Acts.
(a) Endorsement of Loan Party
Documents. At the request of Collateral Agent, all documents
and instruments evidencing any of the Subordinated Debt, if any, shall be
endorsed with a legend noting that such documents and instruments are subject to
this Agreement, and each Loan Party shall promptly confirm to Collateral Agent
its satisfaction of the foregoing requirements and, if requested by Collateral
Agent, deliver to Collateral Agent evidence of the same.
(b) Further Assurances and
Additional Acts. Each Loan Party shall execute, acknowledge,
deliver, file, notarize, and register at its own expense all such further
agreements, instruments, certificates, financing statements, documents, and
assurances, and perform such acts as Collateral Agent reasonably shall deem
necessary or appropriate to effectuate the purposes of this Agreement, and
promptly provide Collateral Agent with evidence of the foregoing in form and
substance reasonably satisfactory to Collateral Agent.
SECTION
14. Notices.
All
notices and other communications provided for hereunder shall, unless otherwise
stated herein, be in writing (including by facsimile transmission) and shall be
mailed, sent, or delivered in accordance with the notice provisions contained in
the Loan Agreement.
SECTION
15. No Waiver; Cumulative
Remedies.
No
failure on the part of the Secured Parties or Collateral Agent (on behalf of
itself or the Secured Parties) to exercise, and no delay in exercising, any
right, remedy, power, or privilege hereunder shall operate as a waiver thereof,
nor shall any single or partial exercise of any such right, remedy, power, or
privilege preclude any other or further exercise thereof or the exercise of any
other right, remedy, power, or privilege. The rights and remedies
under this Agreement are cumulative and not exclusive of any rights, remedies,
powers, and privileges that may otherwise be available to the Secured Parties or
Collateral Agent.
SECTION
16. Costs and
Expenses.
Each Loan
Party jointly and severally agrees to pay to Collateral Agent, for itself and
for the benefit of the Secured Parties, upon demand by Collateral Agent or any
other Secured Party, all costs and expenses of Collateral Agent and the other
Secured Parties, and the fees and disbursements of counsel to Collateral Agent
and the other Secured Parties, in connection with (i) the negotiation,
preparation, execution, delivery, and administration of this Agreement, and any
amendments, modifications, or waivers of the terms thereof or any termination
pursuant to Section
22, and (ii) the enforcement or attempted enforcement of, and
preservation of rights or
-7-
interests
under, this Agreement, including any losses, costs and expenses sustained by
Collateral Agent or the other Secured Parties as a result of any failure by such
Loan Party to perform or observe its obligations contained in this
Agreement.
SECTION
17. Survival.
All
covenants, agreements, representations and warranties made in this Agreement
shall, except to the extent otherwise provided herein, survive the execution and
delivery of this Agreement, and shall continue in full force and effect so long
as any Senior Debt remains unpaid. Without limiting the generality of
the foregoing, the obligations of each Loan Party under Section 16 shall survive
the satisfaction of the Senior Debt.
SECTION
18. Benefits of
Agreement.
This
Agreement is entered into for the sole protection and benefit of the parties
hereto and their successors and assigns, and no other Person shall be a direct
or indirect beneficiary of, or shall have any direct or indirect cause of action
or claim in connection with, this Agreement.
SECTION
19. Binding
Effect.
This
Agreement shall be binding upon, inure to the benefit of and be enforceable by
each Loan Party and the Secured Parties and their respective successors and
permitted assigns.
SECTION
20. GOVERNING
LAW.
THIS
AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE
STATE OF NEW YORK.
SECTION
21. SUBMISSION TO
JURISDICTION.
EACH
BORROWER HEREBY (i) SUBMITS TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF
THE STATE OF NEW YORK AND THE FEDERAL COURTS OF THE UNITED STATES SITTING IN THE
COUNTY OF NEW YORK, STATE OF NEW YORK, FOR THE PURPOSE OF ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, (ii) AGREES THAT
ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND
DETERMINED IN SUCH COURTS, OR AT THE SOLE OPTION OF COLLATERAL AGENT, IN ANY
OTHER COURT IN WHICH COLLATERAL AGENT SHALL INITIATE LEGAL OR EQUITABLE
PROCEEDINGS AND WHICH HAS SUBJECT MATTER JURISDICTION OVER THE MATTER IN
CONTROVERSY, (iii) IRREVOCABLY WAIVES (TO THE EXTENT PERMITTED BY
APPLICABLE LAW) ANY OBJECTION WHICH IT NOW OR HEREAFTER MAY HAVE TO THE LAYING
OF VENUE OF ANY SUCH ACTION OR PROCEEDING BROUGHT IN ANY OF THE FOREGOING
COURTS, AND ANY OBJECTION ON THE GROUND THAT ANY SUCH ACTION OR PROCEEDING IN
ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM AND (iv) AGREES
THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING
-8-
SHALL BE
CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR
IN ANY OTHER MANNER PERMITTED BY LAW.
SECTION
22. Entire Agreement; Amendments
and Waivers.
(a) Entire
Agreement. This Agreement constitutes the entire agreement of
each of the Loan Party, Collateral Agent and Secured Parties with respect to the
matters set forth herein and supersedes any prior agreements, commitments,
drafts, communications, discussions, and understandings, oral or written, with
respect thereto.
(b) Amendments and
Waivers. No amendment to any provision of this Agreement shall
in any event be effective unless the same shall be in writing and signed by each
of the Loan Parties and Collateral Agent; and no waiver of any provision of this
Agreement, or consent to any departure by any Loan Party therefrom, shall in any
event be effective unless the same shall be in writing and signed by Collateral
Agent. Any such amendment, waiver, or consent shall be effective only
in the specific instance and for the specific purpose for which
given.
SECTION
23. Conflicts.
In case
of any conflict or inconsistency between any terms of this Agreement, on the one
hand, and any documents or instruments in respect of the Subordinated Debt, on
the other hand, then the terms of this Agreement shall control.
SECTION
24. Severability.
Whenever
possible, each provision of this Agreement shall be interpreted in such manner
as to be effective and valid under all applicable laws and
regulations. If, however, any provision of this Agreement shall be
prohibited by or invalid under any such law or regulation in any jurisdiction,
it shall, as to such jurisdiction, be deemed modified to conform to the minimum
requirements of such law or regulation, or, if for any reason it is not deemed
so modified, it shall be ineffective and invalid only to the extent of such
prohibition or invalidity without affecting the remaining provisions of this
Agreement or the validity or effectiveness of such provision in any other
jurisdiction.
SECTION
25. Interpretation.
This
Agreement is the result of negotiations between, and have been reviewed by the
respective counsel to, Loan Parties and the several members of the Secured
Parties and is the product of all parties hereto. Accordingly, this
Agreement shall not be construed against any of Collateral Agent or Secured
Parties merely because of their involvement in the preparation
hereof.
SECTION
26. Counterparts.
This
Agreement may be executed in any number of counterparts and by different parties
hereto in separate counterparts, each of which when so executed shall be deemed
to be an original and all of which taken together shall constitute but one and
the same agreement.
-9-
SECTION
27. Termination of
Agreement.
Upon the
occurrence of the Indefeasible Payment and Performance of All Obligations, this
Agreement shall terminate and Collateral Agent, on behalf of the Secured
Parties, shall promptly execute and deliver to each Loan Party such documents
and instruments as shall be necessary to evidence such termination; provided, however, that the
obligations of each Loan Party under Section 16 shall
survive such termination.
[Signature
pages follow]
-10-
IN
WITNESS WHEREOF, the undersigned has duly executed and delivered this Agreement
as of the date first written above.
|
LOAN
PARTIES:
LSB
INDUSTRIES, INC.
By ______________________________
Title _____________________________
|
|
THERMACLIME,
INC.
CHEROKEE
NITROGEN HOLDINGS, INC.,
NORTHWEST
FINANCIAL CORPORATION,
CHEMEX
I CORP.,
CHEMEX
II CORP.,
CHEROKEE
NITROGEN COMPANY,
CLIMACOOL
CORP.,
CLIMATECRAFT,
INC.,
CLIMATE
MASTER, INC.,
DSN
CORPORATION,
EL
DORADO CHEMICAL COMPANY,
INTERNATIONAL
ENVIRONMENTAL CORPORATION,
KOAX
CORP.,
LSB
CHEMICAL CORP.,
THE
CLIMATE CONTROL GROUP, INC.,
TRISON
CONSTRUCTION, INC.,
THERMACLIME
TECHNOLOGIES, INC.,
XPEDIAIR,
INC.
By: ________________________________
Title: _______________________________
|
|
[COLLATERAL
AGENT:]
[BANC OF
AMERICA LEASING & CAPITAL LLC,
as collateral agent on behalf of the Secured
Parties]1
By _________________________________
Title ________________________________
|
EXHIBIT
I
MANAGEMENT
FEE SUBORDINATION AGREEMENT
THIS
MANAGEMENT FEE SUBORDINATION AGREEMENT (this “Agreement”), dated as
of November 2, 2007, is made among LSB INDUSTRIES, INC. (“Parent”), the
Borrowers (as defined hereinafter) and BANC OF AMERICA LEASING & CAPITAL
LLC, as collateral agent (in such capacity, toget\her with its successors, if
any, in such capacity, “Collateral Agent”)
for the Secured Parties (as defined hereinafter).
WHEREAS,
Parent, Cherokee Nitrogen Holdings, Inc. (“Cherokee”),
ThermaClime, Inc., an Oklahoma corporation (“ThermaClime”), and
the subsidiaries of ThermaClime party to this Agreement (each of Cherokee,
ThermaClime and each such subsidiary is herein referred to as a “Borrower” and
Cherokee, ThermaClime and all such subsidiaries are herein referred to,
collectively, as the “Borrowers”), Banc of
America Leasing & Capital, LLC, as administrative agent (“Administrative
Agent”) and as Collateral Agent, Bank of Utah, as payment agent (“Payment Agent”) and
the lenders from time to time party thereto (the “Lenders”;
collectively with the Administrative Agent, the Collateral Agent and the Payment
Agent, the “Secured
Parties”) are parties to that certain Term Loan Agreement dated as of
even date herewith (as amended, modified, renewed, extended, or replaced from
time to time, the “Loan Agreement”),
pursuant to which the Secured Parties have agreed to make certain financial
accommodations to the Borrowers;
WHEREAS,
certain of the Loan Parties currently provides or may provide certain
management, consulting and other services to the other Loan Parties, including
without limitation, pursuant to that certain Management Agreement, dated
November 21, 1997 (as amended or otherwise modified from time to time, the
“Management
Agreement”);
WHEREAS,
Parent and each of the Borrowers (collectively, “Loan Parties”) has
agreed to the subordination of the Subordinated Obligations (defined below),
upon the terms and subject to the conditions set forth in this
Agreement;
NOW,
THEREFORE, in consideration of the mutual promises, covenants, conditions,
representations, and warranties set forth herein and for other good and valuable
consideration, the parties hereto agree as follows:
SECTION
1. Definitions;
Interpretation.
(a) Certain Defined
Terms. Capitalized terms used herein and not otherwise defined
herein shall have the meanings ascribed thereto in the Loan
Agreement. As used in this Agreement, the following terms shall have
the following meanings:
“Bankruptcy Code”
means title 11 of the United States Code, as in effect from time to
time.
“Insolvency
Proceeding” means any proceeding commenced by or against any Person under
any provision of the Bankruptcy Code or under any other state or federal
bankruptcy or insolvency law, assignments for the benefit of creditors, formal
or informal
moratoria,
compositions, extensions generally with creditors, or proceedings seeking
reorganization, arrangement, or other similar relief.
“Senior Obligations”
means the Obligations.
“Loan Documents” means
the “Loan Documents” (as that term is defined in the Loan
Agreement).
“Subordinated
Obligations” means any management, consulting or other fees of any kind,
whether now existing or hereafter arising, and whether due or to become due,
absolute or contingent, liquidated or unliquidated, determined or undetermined,
payable by any Loan Party to any other Loan Party or any officer, director,
employee, agent or Affiliate to any such Loan Party, including without
limitation, pursuant to the Management Agreement.
“Subordinated Management
Payments” means any payment or distribution by or on behalf of any Loan
Party, directly or indirectly, of assets of such Loan Party of any kind or
character, whether in cash, property, or securities, including on account of the
purchase, redemption, or other acquisition of the Subordinated Obligations, as a
result of any collection, sale, or other disposition of collateral, or by
setoff, exchange, or in any other manner, for or on account of the Subordinated
Obligations.
(b) Interpretation. Unless
the context of this Agreement clearly requires otherwise, references to the
plural include the singular, references to the singular include the plural, the
term “including” is not limiting, and the term “or” has, except where otherwise
indicated, the inclusive meaning represented by the phrase
“and/or.” The words “hereof,” “herein,” “hereby,” “hereunder,” and
similar terms in this Agreement refer to this Agreement as a whole and not to
any particular provision of this Agreement. Section, subsection,
clause, schedule, and exhibit references are to this Agreement unless otherwise
specified. References to agreements and other contractual instruments
shall be deemed to include all subsequent amendments and other modifications
thereto. References to statutes or regulations are to be construed as
including all statutory and regulatory provisions consolidating, amending, or
replacing the statute or regulation referred to. The captions and
headings are for convenience of reference only and shall not affect the
construction of this Agreement.
SECTION
2. Subordination to Payment of
Senior Obligations.
As to
each Loan Party and each such Loan Party’s officers, directors, employees,
agents and Affiliates, all payments on account of the Subordinated Obligations,
including all Subordinated Management Payments, shall be subject, subordinate,
and junior, in right of payment and exercise of remedies, to the extent and in
the manner set forth herein, to the prior payment, in full, in cash or cash
equivalents of the Senior Obligations.
SECTION
3. Subordination Upon Any
Distribution of Assets of Borrowers.
As to
each Loan Party and until the prior payment, in full, in cash or cash
equivalents of the Senior Obligations, in the event of any payment or
distribution of assets of any other Loan Party of any kind or character, whether
in cash, property, or securities, upon an
-2-
Insolvency
Proceeding relating to such other Loan Party or its
property: (i) all amounts owing on account of the Senior
Obligations shall first be paid, in full, in cash, or payment provided for in
cash or in cash equivalents, before any Subordinated Management Payments are
made; and (ii) to the extent permitted by applicable law, any Subordinated
Management Payments to which such Loan Party would be entitled except for the
provisions hereof, shall be paid or delivered by the trustee in bankruptcy,
receiver, assignee for the benefit of creditors, or other liquidating agent
making such payment or distribution directly to Collateral Agent for application
to the payment of the Senior Obligations in accordance with clause (i), after
giving effect to any concurrent payment or distribution or provision therefor to
Collateral Agent in respect of such Senior Obligations.
SECTION
4. Payments on Subordinated
Obligations.
(a) Permitted
Payments. So long as no Event of Default has occurred and is
continuing, each Loan Party may make, and other Loan Party shall be entitled to
accept and receive, payments on account of the Subordinated Obligations to the
extent such Subordinated Obligations are permitted under the Loan Agreement and
in compliance with the other provisions of this Agreement.
(b) No Payment Upon Senior
Obligations Defaults. Upon the occurrence of any Event of
Default, and until such Event of Default is cured or waived, no Loan Party shall
make, and no other Loan Party shall not accept or receive, any Subordinated
Management Payments.
SECTION
5. Subordination of
Remedies.
As long
as any Senior Obligations shall remain outstanding and unpaid, no Loan Party
shall, without the prior written consent of Collateral Agent:
(a) accelerate,
or otherwise make due and payable, or make demand prior to the original due date
thereof any Subordinated Obligations or bring suit or institute any other
actions or proceedings to enforce its rights or interests in respect of the
Subordinated Obligations of any Loan Party owing to such Loan
Party;
(b) exercise
any rights under or with respect to guaranties of the Subordinated Obligations,
if any;
(c) exercise
any rights to set-offs (it being understood that an intercompany netting of
payments on the books of the Loan Parties in the ordinary course of business
shall not be deemed a set-off for purposes of this clause (c) so long as
no default has occurred and is continuing under the applicable Subordinated
Obligations and no Event of Default has occurred and is continuing) and
counterclaims in respect of any indebtedness, liabilities, or obligations of
such Loan Party to any other Loan Party against any of the
Subordinated Obligations; or
(d) commence,
or cause to be commenced, or join with any creditor other than Collateral Agent
on behalf thereof in commencing, any bankruptcy, insolvency, or receivership
proceeding against the other Loan Party.
-3-
SECTION
6. Payment Over to Collateral
Agent.
In the
event that, notwithstanding the provisions of Sections 3, 4, and 5, any Subordinated
Management Payments shall be received in contravention of any such Sections 3, 4, or 5 by any Loan Party
before all Senior Obligations is paid in full, in cash or cash equivalents, such
Subordinated Management Payments shall be held in trust for the benefit of
Collateral Agent and shall be paid over or delivered to Collateral Agent for
application to the payment, in full, in cash or cash equivalents, of all Senior
Obligations remaining unpaid to the extent necessary to give effect to such
Sections 3,
4, and 5, the application
thereof in accordance with the Senior Loan Documents and after giving effect to
any concurrent payments or distributions to Collateral Agent in respect of the
Senior Obligations.
SECTION
7. Authorization to Collateral
Agent.
If, while
any Subordinated Obligations is outstanding and until the Indefeasible Payment
and Performance of All Obligations has occurred, any Insolvency Proceeding shall
occur and be continuing with respect to another Loan Party or its
property: (i) Collateral Agent is hereby irrevocably authorized
and empowered (in the name of each Loan Party or otherwise), but shall have no
obligation, to demand, xxx for, collect, and receive every payment or
distribution in respect of the Subordinated Obligations and give acquittance
therefor and to file claims and proofs of claim and take such other action
(including voting the Subordinated Obligations) as it may deem necessary or
advisable for the exercise or enforcement of any of the rights or interests of
the Secured Parties; and (ii) each Loan Party shall promptly take such
action as Collateral Agent may reasonably request (A) to collect the
Subordinated Obligations for the account of the Secured Parties and to file
appropriate claims or proofs of claim in respect of the Subordinated
Obligations, (B) to execute and deliver to Collateral Agent such powers of
attorney, assignments, and other instruments as it may reasonably request to
enable it to enforce any and all claims with respect to the Subordinated
Obligations, and (C) to collect and receive any and all Subordinated
Management Payments.
SECTION
8. Certain Agreements of Each
Loan Party.
(a) No
Benefits. Each Loan Party understands that there may be
various agreements between Collateral Agent or other Secured Parties and any
other Loan Party evidencing and governing the Senior Obligations, and each Loan
Party acknowledges and agrees that such agreements are not intended to confer
any benefits on such Loan Party and that the Secured Parties and Collateral
Agent (on behalf thereof) shall have no obligation to such Loan Party or any
other Person to exercise any rights, enforce any remedies, or take any actions
which may be available to them under such agreements.
(b) No
Interference. Each Loan Party acknowledges that certain of the
Borrowers have granted to Collateral Agent, for itself and for the benefit of
the Secured Parties, security interests in certain of such Borrower’s assets as
set forth in the Loan Agreement and the other Senior Loan Documents, and agrees
not to interfere with or in any manner oppose a disposition of any Collateral by
Collateral Agent on behalf thereof in accordance with applicable
law.
-4-
(c) Reliance by the Secured
Parties. Each Loan Party acknowledges and agrees that the
Secured Parties will have relied upon and will continue to rely upon the
subordination provisions provided for herein and the other provisions hereof in
entering into the Senior Loan Documents and making or issuing the Term Loans
thereunder.
(d) Waivers. Unless
otherwise expressly provided herein or under the Loan Agreement, each Loan Party
hereby waives any and all notice of the incurrence of the Senior Obligations or
any part thereof and any right to require marshaling of assets.
(e) Obligations of Each Loan
Party Not Affected. Each Loan Party hereby agrees that at any
time and from time to time, without notice to or the consent of such Loan Party
except as otherwise provided in the Senior Loan Documents, without incurring
responsibility to such Loan Party, and without impairing or releasing the
subordination provided for herein or otherwise impairing the rights of
Collateral Agent or other Secured Parties hereunder: (i) the
time for any other Loan Party’s performance of or compliance with any of its
agreements contained in the Senior Loan Documents may be extended or such
performance or compliance may be waived by the Secured Parties or Collateral
Agent on behalf thereof; (ii) the agreements of any other Loan Party with
respect to the Senior Loan Documents may from time to time be modified by such
other Loan Party and the Secured Parties or Collateral Agent on behalf thereof;
(iii) the manner, place, or terms for payment of Senior Obligations or any
portion thereof may be altered or the terms for payment extended, or the Senior
Obligations may be renewed in whole or in part; (iv) the maturity of the
Senior Obligations may be accelerated in accordance with the terms of any
present or future agreement by any other Loan Party and the Secured Parties or
Collateral Agent on behalf thereof; (v) any Collateral may be sold,
exchanged, released, or substituted and any Lien in favor of Collateral Agent
for the benefit of the Secured Parties may be terminated, subordinated, or fail
to be perfected or become unperfected; (vi) any Person liable in any manner
for Senior Obligations may be discharged, released, or substituted; and
(vii) all other rights against any other Loan Party, any other Person, or
with respect to any Collateral may be exercised (or the Secured Parties or
Collateral Agent (on behalf thereof) may waive or refrain from exercising such
rights).
(f) Rights of the Secured
Parties Not to Be Impaired. No right of the Secured Parties or
Collateral Agent, on behalf thereof, to enforce the subordination provided for
herein or to exercise its other rights hereunder shall at any time in any way be
prejudiced or impaired by any act or failure to act by any other Loan Party, the
Secured Parties or Collateral Agent hereunder or under or in connection with the
Senior Loan Documents or by any noncompliance by any other Loan Party with the
terms and provisions and covenants herein or in the Senior Loan Documents,
regardless of any knowledge thereof that the Secured Parties or Collateral Agent
may have or otherwise be charged with.
(g) Financial Condition of Loan
Parties. Unless otherwise expressly permitted under the Loan
Agreement, no Loan Party shall have a right to require the Secured Parties to
obtain or disclose any information with respect to: (i) the
financial condition or character of any other Loan Party or the ability of the
other Loan Party to pay and perform Senior Obligations; (ii) the Senior
Obligations; (iii) the Collateral or other security for any or all of the
Senior Obligations; (iv) the existence or nonexistence of any guarantees
of, or any other subordination agreements with respect to, all or any part of
the Senior Obligations; (v) any action
-5-
or
inaction on the part of the Secured Parties or any other Person; or
(vi) any other matter, fact, or occurrence whatsoever.
(h) Acquisition of Liens or
Guaranties. Unless otherwise expressly permitted under the
Loan Agreement, no Loan Party shall, without the prior written consent of
Collateral Agent, acquire any right or interest in or to any Collateral not
owned by such Loan Party or accept any guaranties for the Subordinated
Obligations.
SECTION
9. Subrogation.
Until
the Indefeasible Payment and Performance of All Obligations has occurred, no
Loan Party shall have, or shall directly or indirectly exercise, any rights that
it may acquire by way of subrogation under this Agreement, by any payment or
distribution to the Secured Parties hereunder or otherwise. After the
Indefeasible Payment and Performance of All Obligations has occurred, each Loan
Party shall be entitled to exercise in full any subrogated rights it may possess
with respect to the rights of the Secured Parties to receive payments or
distributions applicable to the Senior Obligations until the Subordinated
Obligations shall be paid in full. For the purposes of the foregoing
subrogation, no payments or distributions to the Secured Parties of any cash,
property, or securities to which any Loan Party would be entitled except for the
provisions of Section
3, 4, or
5 shall, as
among such Loan Party, its creditors (other than the Secured Parties), and the
other Loan Parties, be deemed to be a payment by the other Loan Parties to or on
account of the Senior Obligations.
SECTION
10. Continuing Agreement;
Reinstatement.
(a) Continuing
Agreement. This Agreement is a continuing agreement of
subordination and shall continue in effect and be binding upon each Loan Party
until the Senior Obligations is paid and performed in full and the Loan
Agreement is terminated in accordance with its terms. The
subordinations, agreements, and priorities set forth herein shall remain in full
force and effect regardless of whether any party hereto in the future seeks to
rescind, amend, terminate, or reform, by litigation or otherwise, its respective
agreements with the other Loan Parties.
(b) Reinstatement. This
Agreement shall continue to be effective or shall be reinstated, as the case may
be, if, for any reason, any payment of the Senior Obligations by or on behalf of
any Loan Party shall be rescinded or must otherwise be restored by Collateral
Agent or the Secured Parties, whether as a result of an Insolvency Proceeding or
otherwise.
SECTION
11. Transfer of Subordinated
Obligations.
No Loan
Party may assign or transfer its rights and obligations in respect of the
Subordinated Obligations, except to another Loan Party which is a party to this
Agreement, without the prior written consent of Collateral Agent and any such
transferee or assignee, as a condition to acquiring an interest in the
Subordinated Obligations shall agree to be bound hereby, in form and substance
reasonably satisfactory to Collateral Agent.
-6-
SECTION
12. Obligations of Loan Parties
Not Affected.
The
provisions of this Agreement are intended solely for the purpose of defining the
relative rights of each Loan Party against the other Loan Parties, on the one
hand, and of the Secured Parties and Collateral Agent on behalf thereof against
the other Loan Parties, on the other hand. Nothing contained in this
Agreement shall (i) impair, as between each Loan Party and the other Loan
Parties, the obligation of the other Loan Parties to pay their respective
obligations with respect to the Subordinated Obligations as and when the same
shall become due and payable, or (ii) otherwise affect the relative rights
of each Loan Party against the other Loan Parties, on the one hand, and of the
creditors (other than the Secured Parties) of the other Loan Parties against the
other Loan Parties, on the other hand.
SECTION
13. Endorsement of Loan Party
Documents; Further Assurances and Additional Acts.
(a) Endorsement of Loan Party
Documents. At the request of Collateral Agent, all documents
and instruments evidencing any of the Subordinated Obligations, if any, shall be
endorsed with a legend noting that such documents and instruments are subject to
this Agreement, and each Loan Party shall promptly confirm to Collateral Agent
its satisfaction of the foregoing requirements and, if requested by Collateral
Agent, deliver to Collateral Agent evidence of the same.
(b) Further Assurances and
Additional Acts. Each Loan Party shall execute, acknowledge,
deliver, file, notarize, and register at its own expense all such further
agreements, instruments, certificates, financing statements, documents, and
assurances, and perform such acts as Collateral Agent reasonably shall deem
necessary or appropriate to effectuate the purposes of this Agreement, and
promptly provide Collateral Agent with evidence of the foregoing in form and
substance reasonably satisfactory to Collateral Agent.
SECTION
14. Notices.
All
notices and other communications provided for hereunder shall, unless otherwise
stated herein, be in writing (including by facsimile transmission) and shall be
mailed, sent, or delivered in accordance with the notice provisions contained in
the Loan Agreement.
SECTION
15. No Waiver; Cumulative
Remedies.
No
failure on the part of the Secured Parties or Collateral Agent (on behalf of
itself or the Secured Parties) to exercise, and no delay in exercising, any
right, remedy, power, or privilege hereunder shall operate as a waiver thereof,
nor shall any single or partial exercise of any such right, remedy, power, or
privilege preclude any other or further exercise thereof or the exercise of any
other right, remedy, power, or privilege. The rights and remedies
under this Agreement are cumulative and not exclusive of any rights, remedies,
powers, and privileges that may otherwise be available to the Secured Parties or
Collateral Agent.
-7-
SECTION
16. Costs and
Expenses.
Each Loan
Party jointly and severally agrees to pay to Collateral Agent, for itself and
for the benefit of the Secured Parties, upon demand by Collateral Agent or any
other Secured Party, all costs and expenses of Collateral Agent and the other
Secured Parties, and the fees and disbursements of counsel to Collateral Agent
and the other Secured Parties, in connection with (i) the negotiation,
preparation, execution, delivery, and administration of this Agreement, and any
amendments, modifications, or waivers of the terms thereof or any termination
pursuant to Section
22, and (ii) the enforcement or attempted enforcement of, and
preservation of rights or interests under, this Agreement, including any losses,
costs and expenses sustained by Collateral Agent or the other Secured Parties as
a result of any failure by such Loan Party to perform or observe its obligations
contained in this Agreement.
SECTION
17. Survival.
All
covenants, agreements, representations and warranties made in this Agreement
shall, except to the extent otherwise provided herein, survive the execution and
delivery of this Agreement, and shall continue in full force and effect so long
as any Senior Obligations remains unpaid. Without limiting the
generality of the foregoing, the obligations of each Loan Party under Section 16
shall survive the satisfaction of the Senior Obligations.
SECTION
18. Benefits of
Agreement.
This
Agreement is entered into for the sole protection and benefit of the parties
hereto and their successors and assigns, and no other Person shall be a direct
or indirect beneficiary of, or shall have any direct or indirect cause of action
or claim in connection with, this Agreement.
SECTION
19. Binding
Effect.
This
Agreement shall be binding upon, inure to the benefit of and be enforceable by
each Loan Party and the Secured Parties and their respective successors and
permitted assigns.
SECTION
20. GOVERNING
LAW.
THIS
AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE
STATE OF NEW YORK.
SECTION
21. SUBMISSION TO
JURISDICTION.
EACH
BORROWER HEREBY (i) SUBMITS TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF
THE STATE OF NEW YORK AND THE FEDERAL COURTS OF THE UNITED STATES SITTING IN THE
COUNTY OF NEW YORK, STATE OF NEW YORK, FOR THE PURPOSE OF ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, (ii) AGREES THAT
ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND
DETERMINED IN SUCH COURTS, OR AT THE SOLE OPTION OF COLLATERAL
-8-
AGENT, IN
ANY OTHER COURT IN WHICH COLLATERAL AGENT SHALL INITIATE LEGAL OR EQUITABLE
PROCEEDINGS AND WHICH HAS SUBJECT MATTER JURISDICTION OVER THE MATTER IN
CONTROVERSY, (iii) IRREVOCABLY WAIVES (TO THE EXTENT PERMITTED BY
APPLICABLE LAW) ANY OBJECTION WHICH IT NOW OR HEREAFTER MAY HAVE TO THE LAYING
OF VENUE OF ANY SUCH ACTION OR PROCEEDING BROUGHT IN ANY OF THE FOREGOING
COURTS, AND ANY OBJECTION ON THE GROUND THAT ANY SUCH ACTION OR PROCEEDING IN
ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM AND (iv) AGREES
THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND
MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER
MANNER PERMITTED BY LAW.
SECTION
22. Entire Agreement; Amendments
and Waivers.
(a) Entire
Agreement. This Agreement constitutes the entire agreement of
each of the Loan Party, Collateral Agent and Secured Parties with respect to the
matters set forth herein and supersedes any prior agreements, commitments,
drafts, communications, discussions, and understandings, oral or written, with
respect thereto.
(b) Amendments and
Waivers. No amendment to any provision of this Agreement shall
in any event be effective unless the same shall be in writing and signed by each
of the Loan Parties and Collateral Agent; and no waiver of any provision of this
Agreement, or consent to any departure by any Loan Party therefrom, shall in any
event be effective unless the same shall be in writing and signed by Collateral
Agent. Any such amendment, waiver, or consent shall be effective only
in the specific instance and for the specific purpose for which
given.
SECTION
23. Conflicts.
In case
of any conflict or inconsistency between any terms of this Agreement, on the one
hand, and any documents or instruments in respect of the Subordinated
Obligations, on the other hand, then the terms of this Agreement shall
control.
SECTION
24. Severability.
Whenever
possible, each provision of this Agreement shall be interpreted in such manner
as to be effective and valid under all applicable laws and
regulations. If, however, any provision of this Agreement shall be
prohibited by or invalid under any such law or regulation in any jurisdiction,
it shall, as to such jurisdiction, be deemed modified to conform to the minimum
requirements of such law or regulation, or, if for any reason it is not deemed
so modified, it shall be ineffective and invalid only to the extent of such
prohibition or invalidity without affecting the remaining provisions of this
Agreement or the validity or effectiveness of such provision in any other
jurisdiction.
-9-
SECTION
25. Interpretation.
This
Agreement is the result of negotiations between, and have been reviewed by the
respective counsel to, Loan Parties and the several members of the Secured
Parties and is the product of all parties hereto. Accordingly, this
Agreement shall not be construed against any of Collateral Agent or Secured
Parties merely because of their involvement in the preparation
hereof.
SECTION
26. Counterparts.
This
Agreement may be executed in any number of counterparts and by different parties
hereto in separate counterparts, each of which when so executed shall be deemed
to be an original and all of which taken together shall constitute but one and
the same agreement.
SECTION
27. Termination of
Agreement.
Upon the
occurrence of the Indefeasible Payment and Performance of All Obligations, this
Agreement shall terminate and Collateral Agent, on behalf of the Secured
Parties, shall promptly execute and deliver to each Loan Party such documents
and instruments as shall be necessary to evidence such termination; provided, however, that the
obligations of each Loan Party under Section 16 shall
survive such termination.
[Signature
pages follow]
-10-
IN
WITNESS WHEREOF, the undersigned has duly executed and delivered this Agreement
as of the date first written above.
|
PARENT:
LSB
INDUSTRIES, INC.
By _________________________
Title ________________________
|
|
BORROWERS:
|
|
THERMACLIME,
INC.
CHEROKEE
NITROGEN HOLDINGS, INC.,
NORTHWEST
FINANCIAL CORPORATION,
CHEMEX
I CORP.,
CHEMEX
II CORP.,
CHEROKEE
NITROGEN COMPANY,
CLIMACOOL
CORP.,
CLIMATECRAFT,
INC.,
CLIMATE
MASTER, INC.,
DSN
CORPORATION,
EL
DORADO CHEMICAL COMPANY,
INTERNATIONAL
ENVIRONMENTAL CORPORATION,
KOAX
CORP.,
LSB
CHEMICAL CORP.,
THE
CLIMATE CONTROL GROUP, INC.,
TRISON
CONSTRUCTION, INC.,
THERMACLIME
TECHNOLOGIES, INC.,
XPEDIAIR,
INC.
By: _______________________________
Title: _____________________________
|
|
[COLLATERAL
AGENT:]
[BANC OF
AMERICA LEASING & CAPITAL LLC,
as collateral agent on behalf of the Secured
Parties]1
By ________________________________
Title ______________________________
|
November
6, 2007
The
Lenders Party to
the Loan
Agreement referred to below
and
Banc of
America Leasing & Capital, LLC,
as
Administrative Agent and as Collateral Agent
and
Bank of
Utah,
as
Payment Agent
Re: Term
Loan Facility for ThermaClime, Inc., Cherokee Nitrogen Holdings, Inc., Northwest
Financial Corporation, Chemex I Corp., Chemex II Corp., Cherokee Nitrogen
Company, ClimaCool Corp., ClimateCraft, Inc., Climate Master, Inc., DSN
Corporation, El Dorado Chemical Company, International Environmental
Corporation, Koax Corp., LSB Chemical Corp., The Climate Control Group, Inc.,
Trison Construction, Inc., ThermaClime Technologies, Inc., and XpediAir, Inc.
and guaranteed by LSB Industries, Inc.
Ladies
and Gentlemen:
I am
general counsel to LSB Industries, Inc., a Delaware corporation (the “Parent”), ThermaClime, Inc.,
an Oklahoma corporation (“ThermaClime”), Cherokee
Nitrogen Holdings, Inc., an Oklahoma corporation (“Cherokee”), Northwest
Financial Corporation, an Oklahoma corporation (“NFC”), Chemex I Corp., an
Oklahoma corporation (“Chemex
I”), Chemex II Corp., an Oklahoma corporation (“Chemex II”), Cherokee Nitrogen
Company, an Oklahoma corporation (“CNC”), ClimaCool Corp., an
Oklahoma corporation (“ClimaCool”), ClimateCraft,
Inc., an Oklahoma corporation (“ClimateCraft”), Climate
Master, Inc., a Delaware corporation (“Climate Master”), DSN
Corporation, an Oklahoma corporation (“DSN”), El Dorado Chemical
Company, an Oklahoma corporation (“El Dorado”), International
Environmental Corporation, an Oklahoma corporation (“IEC”), Koax Corp., an Oklahoma
corporation (“Koax”),
LSB Chemical Corp., an Oklahoma corporation (“LSB Chemical”), The Climate
Control Group, Inc., an Oklahoma corporation (“TCCG”), Trison Construction,
Inc., an Oklahoma corporation (“Trison”), ThermaClime
Technologies, Inc., an Oklahoma corporation (“TTI”), and XpediAir, Inc., an
Oklahoma corporation (“XpediAir” and, together with
ThermaClime, Cherokee, NFC, Chemex I, Chemex II, CNC, ClimaCool, ClimateCraft,
Climate Master, DSN, El Dorado, IEC, Koax, LSB Chemical, TCCG, Trison and TTI,
collectively, the “Borrowers”, and each, a “Borrower”), in connection with
the term loan facility established by that certain Term Loan Agreement, dated as
of November 2, 2007 (the “Loan
Agreement”), by and among the Borrowers, Banc of America Leasing &
Capital, LLC (“BALC”),
in its capacity
November
6, 2007
Page 2
as
administrative agent (the “Administrative Agent”) and as
collateral agent (the “Collateral Agent”), Bank of
Utah, in its capacity as payment agent (the “Payment Agent”), and the
Lenders from time to time party thereto (together with their successors and
assigns, the “Lenders”)
and other Transaction Documents (as that term is hereafter
defined). This opinion is being furnished to you pursuant to
Section 4.01(a)(vii) of the Loan Agreement.
Capitalized
terms used but not defined herein shall have the meaning given thereto in the
Loan Agreement and, if not defined therein, in the related Transaction Documents
(as hereinafter defined). The Parent and the Borrowers are each
referred to herein as a “Loan
Party” and are collectively referred to herein as the “Loan
Parties”. References herein to the “UCC” are to the Uniform
Commercial Code as in effect in the state referenced in connection therewith, or
if no such reference is made, as is in effect in the appropriate state as the
context requires.
I. MY
REVIEW
I have
made such legal and factual examinations as I have deemed necessary or advisable
for the purposes of rending the opinions expressed herein, including the
examination and review of the following documents and instruments, each dated as
of November 2, 2007, unless otherwise indicated (the following documents and
instruments listed at clauses (a)-(bb) are collectively referred to herein as
the “Transaction
Documents”):
(a) the Loan
Agreement;
(b) the Term
Notes;
(c) the
Guaranty;
(d) the
Security Agreement;
(e) the
Cherokee Mortgage;
(f) the El
Dorado Mortgage;
(g) the Fee
Letters;
(h) the
Intercompany Loan Subordination Agreement;
(i) the
Intercompany Lease Subordination Agreement;
(j) the
Inter-Lender Agreement;
(k) the
Management Agreement Subordination;
Novembe
6, 2007
Page
3
(l) the
Trademark Security Agreement;
(m) Xxxxxx
Xxxxxxxx, Airgas, Austin Powder, Xxxxxx Farms Lease Assignments;
(n) Xxxx,
Interconn, Watco, Air Liquide Consents to Assignment;
(o) the UCC-1
financing statements naming El Dorado, DSN, NFC, CNC and Cherokee (collectively,
the “Grantors”), as
debtor and the Collateral Agent as secured party (collectively, the “Oklahoma Financing
Statements”), in the form set forth on Exhibit A hereto, to
be filed in the Office of the County Clerk of Oklahoma County (the “OK County
Clerk”);
(p) the
UCC-3 financing statements with respect to Orix Capital Markets, LLC, in the
forms set forth on Exhibit B hereto (the
“Orix Release
Documents”), to be filed with the OK County Clerk;
(q) the UCC-3
financing statements with respect to Xxxxx Fargo Foothill, Inc., to be filed
with the OK County Clerk and the releases of the Security Interests in the
Trademarks to be filed with the USPTO, in the forms set forth on Exhibit C hereto (the
“WFF Release
Documents”);
(r) the
Organizational Documents of each of the Loan Parties, as amended and in effect
on the date hereof;
(s) the
minute books of the Loan Parties, and unanimous written consents of the Board of
Directors of the Loan Parties dated October 19, 2007;
(t) (i) a
certificate from the Secretary of State of the State of Delaware (“Delaware SOS”) dated October
22, 2007 with respect to the existence and good standing of the Parent in the
State of Delaware, and (ii) a certificate from the Secretary of State of the
State of Oklahoma (“Oklahoma
SOS”) dated October 22, 2007 with respect to the existence and good
standing of the Parent and Parent’s qualification to do business in the State of
Oklahoma;
(u) (i) a
certificate from the Delaware SOS dated October 22, 2007 with respect to the
existence and good standing of Climate Master in the State of Delaware, and (ii)
a certificate from the Oklahoma SOS dated October 22, 2007 with respect to the
existence and good standing of Climate Master and Climate Master’s qualification
to do business in the State of Oklahoma;
(v) certificates
from the Oklahoma SOS dated October 22, 2007 with respect to the existence and
good standing of each Borrower, other than Climate Master, in the State of
Oklahoma;
November
6, 2007
Page 4
(w) a
certificate from the Alabama SOS dated October 22, 2007 with respect to the good
standing of Cherokee in the State of Alabama and Cherokee’s qualification to do
business in the State of Alabama;
(x) a
certificate from the Alabama SOS dated October 22, 2007 with respect to the good
standing of CNC in the State of Alabama and CNC’s qualification to do business
in the State of Alabama;
(y) a
certificate from the Arkansas SOS dated October 22, 2007 with respect to the
good standing of NFC in the State of Arkansas and NFC’s qualification to do
business in the State of Arkansas;
(z) a
certificate from the Arkansas SOS dated October 22, 2007 with respect to the
good standing of El Dorado in the State of Arkansas and El Dorado’s
qualification to do business in the State of Arkansas;
(aa) a
certificate from the Arkansas SOS dated October 22, 2007 with respect to the
good standing of DSN in the State of Arkansas and DSN’s qualification to do
business in the State of Arkansas; and
(bb) Amended
and Restated Loan and Security Agreement, by and among Parent as
guarantor, ThermaClime and each of its subsidiaries that are signatories thereto
as borrowers, the lenders that are signatories thereto and Xxxxx Fargo Foothill,
Inc. as the arranger and administrative agent.
I have also reviewed such other
documents, certificates, corporate and other records as I have deemed necessary
or appropriate as a basis for the opinion set forth herein.
Any
reference to any of the instruments or documents identified above includes all
schedules, exhibits, and annexes thereto, if any.
II. OPINIONS
Based on
the foregoing and subject to the assumptions and qualifications set forth below,
I am of the opinion that:
1. The
Parent is validly existing as a corporation in good standing under the laws of
the State of Delaware, and has the corporate power and authority, and holds all
requisite governmental license, permits and other approvals (other than such
licenses, permits or approvals the absence of which would not result in a
Material Adverse Effect), to own and lease its properties and to carry on its
business as presently conducted and as presently proposed to be
conducted. Except for Climate Master, each Borrower is validly
existing as a corporation in
November
6, 2007
Page 5
good
standing under the laws of the State of Oklahoma and has the corporate power and
authority, and holds all requisite governmental license, permits and other
approvals (other than such licenses, permits or approvals the absence of which
would not result in a Material Adverse Effect), to own and lease its properties
and to carry on its business as presently conducted and as presently proposed to
be conducted. Climate Master is validly existing as a corporation in
good standing under the laws of the State of Delaware and has the corporate
power and authority, and holds all requisite governmental license, permits and
other approvals (other than such licenses, permits or approvals the absence of
which would not result in a Material Adverse Effect), to own and lease its
properties and to carry on its business as presently conducted. Each
of the Borrowers is a wholly-owned subsidiary of the Parent.
2. Each of
the Parent and Climate Master is in good standing as a foreign corporation under
the laws of the State of Oklahoma and in each other jurisdiction where it is
required to qualify to do business other than where the failure to so qualify
would have a Material Adverse Effect. Each of Cherokee and CNC is in
good standing as a foreign corporation under the laws of the State of Alabama
and in each other jurisdiction where it is required to qualify to do business
other than where the failure to so qualify would have a Material Adverse
Effect. Each of El Dorado, DSN and NFC is in good standing as a
foreign corporation under the laws of the State of Arkansas and in each other
jurisdiction where it is required to qualify to do business other than where the
failure to so qualify would have a Material Adverse Effect. Each of
the other Borrowers is in good-standing as a foreign corporation in each
jurisdiction where it is required to qualify to do business other than where the
failure to so qualify would have a Material Adverse Effect
3. Each of
the Loan Parties has the corporate power and authority to execute, deliver, and
perform its obligations under the Transaction Documents to which it is a party
and the execution and delivery by each of the Loan Parties of the Transaction
Documents to which each such Loan Party is a party and the performance by each
such Loan Party of its obligations thereunder have been duly authorized by all
necessary corporate action on the part of each such Loan Party.
4. Each of
the Transaction Documents has been duly executed and delivered by each Loan
Party that is a party thereto.
5. Each of
the Transaction Documents constitute legal, valid and binding obligations of
each Loan Party that is a party thereto, enforceable against each such Loan
Party in accordance with its terms.
6. The
execution and delivery by each Loan Party of the Transaction Documents to which
each such Loan Party is a party and the performance by such Loan Party of its
obligations thereunder will not: (i) violate any provision of such
Loan Party’s respective Organizational
November
6, 2007
Page 6
Documents;
(ii) violate any Applicable Law (as defined below); (iii) violate any order,
judgment, or decree of any domestic court or other agency of domestic government
that is binding upon any such Loan Party or the assets of such Loan Party; (iv)
constitute a default under any terms, conditions, or provisions of any of the
agreements described on the Schedules to the Loan Agreement or, any other
material agreement or instrument to which such Loan Party is a party or to which
such Loan Party or its assets is bound which breach or defect would have a
Material Adverse Effect; or (v) result in the creation of any Lien upon such
Borrower’s property, other than in favor of the Collateral Agent and the Lenders
as contemplated by the Loan Documents.
7. No
registration, authorization, filing with, consent, approval, withholding of
objection of, notice to, or other action by, any governmental entity is required
under any Applicable Law in connection with the execution, delivery, or
performance by any Loan Party of the Transaction Documents to which such Loan
Party is a party and the consummation of the transactions contemplated thereby
(other than such registration, authorization, filing, consent, approval,
withholding of objection, notice, or other actions that have been completed or
obtained (as applicable) prior to the date hereof and except for the filing of
financing statements listed in Schedule 4.01(a)(iii) to the Loan
Agreement). Parent is required to disclose the Term Loan Facility in
its Securities and Exchange Commission filings.
8. Except as
set forth on the Schedules to the Loan Agreement, there is no action, suit, or
proceeding before, or instituted by, any court or governmental agency or body,
domestic or foreign now pending or to my knowledge filed but not yet served or
threatened against any Loan Party: (i) asserting the invalidity of
any of the Transaction Documents; (ii) seeking to prevent the consummation of
any of the transactions contemplated by the Transaction Documents; or (iii)
seeking any determination or ruling that could reasonably be expected to, if
adversely determined, have a Material Adverse Effect.
9. None of
the Administrative Agent, the Collateral Agent, the Payment Agent or any of the
Lenders is required under the laws of the State to qualify as a foreign
corporation or otherwise qualify in the State to file a designation for service
of process or similar type of filing in the State solely as a result of its
execution, delivery and performance of the Loan Documents to which it is a
party.
10. The
provisions of the Security Agreement are effective to create in favor of the
Collateral Agent, for the benefit of the Lenders, a valid security interest
under Article 9 of the UCC in all right, title, and interest of the Grantors in
the Collateral (as defined in the Security Agreement) in which a security
interest may be created under Article 9 of the UCC (the “UCC Collateral”).
11. The
provisions of the Trademark Security Agreement are effective to create in favor
of the Collateral Agent, for the benefit of the Lenders, a valid security
interest in all right, title, and interest of the Loan Parties in the Trademark
Collateral as defined in the Trademark
November
6, 2007
Page 7
Security
Agreement (the “Trademark
Collateral”). The Trademark Security Agreement when filed with
the United States Patent and Trademark Office (the “USPTO”) will have been filed
in all public offices in which such filing is necessary to perfect the interests
of the Secured Parties in the Trademark Collateral described therein to the
extent the same can be perfected by filing with the USPTO.
12. The
Oklahoma Financing Statements, the forms of which are attached hereto as Exhibit A, are in
form sufficient under the laws of the State for filing in Oklahoma, and when
filed with the OK County Clerk will have been filed in all public offices in the
State in which such filing is necessary to perfect the interests of the Secured
Parties in the UCC Collateral described therein to the extent a security
interest in the UCC Collateral may be perfected by the filing of a UCC-1
Financing Statement.
13. Upon the
filing of the Orix Release Documents, all of Orix’s liens as reflected in the
Orix loan documents or the lien searches with respect to the Collateral, other
than real property and fixtures, shall have been terminated or
released.
14. Upon the
filing of the WFF Release Documents, all of Foothill’s liens as reflected in the
Foothill loan documents or the lien searches with respect to the Collateral,
other than real property and fixtures, shall have been terminated or
released.
15. Assuming
the perfection of the security interests in the manner set forth in the
preceding Paragraph 12, no other recordation or filing need be made, and no
other action need be taken, in order to perfect the Collateral Agent’s and the
Lenders’ security interest in the UCC Collateral.
16. Except
for the filings and recordings described above, no approval, consent, or
withholding of objection on the part of, or filing or registration with, any
Governmental Authority is required to be made or taken in the State to
establish, protect and preserve title to, interests in, liens on and security
interests in the Collateral as contemplated by the Loan Documents, except for
UCC continuation statements.
17. Except
for nominal filing or recording fees payable at the time of filing or recording
of the Oklahoma Financing Statements, the Orix Release Documents and the WFF
Release Documents, no taxes (other than state and federal income tax paid on
interest or fees accruing on the Loan), fees or other charges imposed by the
State, county or any other local governmental entity are payable by the
Administrative Agent, the Collateral Agent, the Payment Agent or the Lenders
solely as a result of the execution, delivery, recordation or filing (where
applicable) of the Loan Documents and all other instruments delivered in
connection with the transactions contemplated thereby.
November
6, 2007
Page 8
18. (a) Attached
hereto as Exhibit D-[___] is a copy of the UCC search report summary that was
obtained by [________________] from the State of Oklahoma with respect to
Borrowers (the “________ Report”). The ________ Report identifies no
still effective financing statement covering any of the Collateral naming the
Borrowers, as debtor filed in the UCC filing offices for the State of
[___________] prior to [_____________], 2007 at
[_______][a.m./p.m.].
(b) [Please
provide same opinion with respect to each jurisdiction where search
conducted.]
19. The
description of the UCC Collateral (except for tort claims arising after the date
of this opinion) contained in the Oklahoma Financing Statement is legally
sufficient under the laws of the State of Oklahoma for the purpose of subjecting
such collateral to the lien of the Collateral Agent and the
Lenders.
20. The
provisions in the Loan Documents concerning interest, late fees, prepayment
premiums, default rate of interest and other charges, including the methods of
calculation and payment thereof, are not usurious under, or otherwise violative
of, the laws of the State.
21. The
express choice of law of the State of New York to govern the Loan Documents
(excluding all of the real estate security documents listed in Schedule
4.01(a)(iii)) is enforceable and will be recognized by the courts in the
State. Notwithstanding the foregoing, if any such court did not give
effect to such choice of laws provisions and held that the laws of the State
governed the Loan Documents, each such Loan Document would constitute the valid,
binding and enforceable obligation of the parties thereto (subject to the
limitations set forth in clause (a) in section III herein).
22. A
decision by a New York court to grant a money judgment would be respected by a
state or federal court in the State.
23. The laws
of the State does not require a lienholder to make an election of remedies where
such lienholder holds security interests and liens on both the real and the
personal property of a debtor or to take recourse first or solely against or
otherwise exhaust its remedies against its collateral before otherwise
proceeding to enforce against such debtor the obligations of such
debtor.
24. None of
the Loan Parties is: (a) a public utility company within the meaning
of the Public Utility Holding Company Act of 1935, as amended; (b) subject to
current regulation thereunder; or (c) an “investment company” or a company
“controlled” by an “investment company” within the meaning of the Investment
Company Act of 1940, as amended, subject to current regulation thereunder, or
subject to any federal or state regulation limiting its ability to incur
indebtedness for borrowed money or encumber its real or personal property
assets.
November
6, 2007
Page 9
III. ASSUMPTIONS AND
QUALIFICATIONS
The
opinions expressed in Section II above
are subject to the following assumptions and qualifications:
(a) The
opinion set forth in Paragraph 5 of Section II above
are subject to, and may be limited by: (i) bankruptcy, insolvency,
reorganization, moratorium, rearrangement, liquidation, conservatorship,
fraudulent conveyance, and other similar laws (including court decisions) now or
hereafter in effect relating to or affecting the rights of creditors generally;
(ii) general principles of equity (including without limitation, concepts
of materiality, reasonableness, good faith and fair dealing, and the award of
injunctive relief or other equitable remedies being in the discretion of the
court to which application for such relief is made), regardless of whether
enforceability of the applicable agreements is considered in a proceeding in
equity or at law; and (iii) as they relate to certain remedial or
procedural provisions of the applicable agreements, applicable federal and state
laws (including court decisions, and including any delays in the enforcement of
any such remedial provisions which may result therefrom), but such laws and
court decisions do not, in my opinion, subject to the matters referred to in the
preceding clauses (i) and (ii) interfere with the practical realization of the
benefits purported to be provided by the remedial and procedural provisions of
the applicable agreements.
(b) I have
assumed that: (i) each document submitted to me for review is
accurate and complete, each such document that is an original is authentic, each
such document that is a copy conforms to an authentic original, all signatories
to such documents (other than the Loan Parties) have been duly authorized, and
all signatures on each document (other than the Loan Parties) are genuine;
(ii) there has not been any mutual mistake of fact or misunderstanding,
fraud, duress, or undue influence; (iii) the conduct of the parties has
complied with any requirement of good faith, fair dealing, and conscionability;
and (iv) except with respect to the Transaction Documents, there are no
agreements or understandings among the parties, written or oral, and there is no
usage of trade or course of prior dealing among the parties that would, in
either case, define, supplement, or qualify the terms of any of the agreements
or documentation on which I have opined.
(c) With
respect to the opinion set forth in Paragraph 5 of Section II above
other than with respect to the Loan Parties, I have assumed that each of the
other parties to the Transaction Documents is duly organized and validly
existing under the laws of the jurisdiction of its organization, with all
requisite power and authority to enter into and perform its respective
obligations under the Transaction Documents to which it is a
party. In each case, with respect to the opinion set forth in
Paragraph 5 of Section II above
other than with respect to the Loan Parties, I have assumed that each of the
Transaction Documents: (i) constitutes the legal, valid, and
binding agreement of each other party
November
6, 2007
Page 10
thereto,
enforceable against each such other party thereto (subject to the qualifications
set forth in paragraph (a) of this Section III); and
(ii) has been duly and validly authorized, executed, and delivered by each other
party thereto.
(d) With
respect to the opinions set forth in Paragraphs 12 and 13 of Section II
above, further filings under the UCC may be necessary to preserve and maintain
(to the extent established and perfected by the filing of a financing statement
as described herein), the perfection of the security interests of the Collateral
Agent and the Lenders in the UCC Collateral, as follows:
(1) appropriate
continuation filings to be made within the period of six months prior to the
expiration of the five year anniversary date from the date of the original
filing of the applicable financing statement;
(2) filings
required to be made within four months of the change of name,
identity, or corporate structure of the debtor to the extent set forth in
Sections 9-507 and 9-508 of the UCC;
(3) filings
required to be made within four months after the respective debtor changes its
location, to the extent set forth in Section 9-316 of the UCC;
and
(4) filings
required within one year after the transfer of collateral to a Person that
becomes a debtor and is located in another jurisdiction, to the extent set forth
in Section 9-316 of the UCC.
(e) With
regard to the opinions expressed herein, I express no opinion:
(i) As to any
federal securities or state blue sky laws, rules or regulations;
(ii) As to the
enforceability of provisions in any of the Transaction Documents relating to
waiver of rights to trial by jury;
(iii) The
enforceability of any provisions which purport to restrict, limit or prevent
access to legal or equitable remedies, which purport to waive any rights to
notices or any other legal rights, or which purport to establish evidentiary
standards;
(iv) The
enforceability of any provisions relating to delay or omissions of the
enforcement of rights or remedies, waiver or ratification of future acts,
consent judgments, or marshalling of assets;
(v) Any
federal or state environmental laws;
November
6, 2007
Page 11
(vi) The
creation or perfection of any security interest or lien in and to (A) any real
property (or fixtures located thereon), (B) “farm products” (as defined in the
UCC), (C) “timber”, “as-extracted collateral” (as described in UCC Section
9501(a)(1)), or (D) other than as stated herein, intellectual
property; provided, however, to my knowledge, the Collateral does not include
any farm products or timber;
(vii) As to the
solvency of the Parent or the Borrowers, individually or on a consolidated
basis; or
(viii) As to any
other matters not covered by the opinions set forth above in this
letter.
(f) The
phrase “to my knowledge” means actual knowledge.
(g) Provisions
of the Transaction Documents which purport to indemnify any party against or
release any party from, liability for any acts that are unenforceable to the
extent such acts are determined to be unlawful, negligent, reckless or
constitute willful misconduct.
(h) Without
limitation of the opinion provided in Paragraph 20 in Section II above, the
provisions at Section 11.09 of the Loan Agreement purporting to exculpate any
party from any violation of usuary laws by the ipso facto reduction of
interest in excess of the maximum rate, and/or the application of such excess
interest to principal or return thereof to the Borrowers are unenforceable based
on Oklahoma Preferred Finance
& Loan Corporation x. Xxxxxx, 497 P.2d 221 (1972).
(i) As to
enforceability of that portion of the Transaction Documents that provide if any
provisions of the Transaction Documents are determined to be illegal, invalid or
unenforceable, the remaining provisions remains in full force and effect where
any such provision is an essential part of the Transaction Documents, and the
parties would not have entered into the documents absent such
provision.
(j) The
enforceability of the Transaction Documents is subject to the effect of
principles of law regarding course of dealing and performed oral modification to
the Transaction Documents.
(k) “State” means the State of
Oklahoma. “Applicable Laws” means those
laws, rules, and regulations of the United States, the State of Oklahoma and the
corporate laws of the State of Delaware.
(l) I express
no opinion as to the laws of any jurisdiction other than the laws, rules and
regulations of the United States, the State of Oklahoma and the corporate law of
Delaware.
November
6, 2007
Page 12
IV. CONCLUSION
Except as
set forth in the following sentence, this opinion is being furnished solely for
the benefit of you and your successors and assigns, and your and their
respective counsel, in connection with the transactions contemplated by the Loan
Documents. The Administrative Agent and the Collateral Agent, and
their respective successors and assigns and each Lender (whether a party to the
Loan Agreement on the date hereof or becoming a party in the future) may rely on
this opinion to the same extent as if it were addressed and delivered to such
person on the date hereof. No other use of this opinion may be made
without our approval.
Respectfully
submitted,
Xxxxx X.
Xxxxx
Senior
Vice President and General Counsel
EXHIBIT
A
Form of
Oklahoma Financing Statements
EXHIBIT
B
Form of
Orix Filings
EXHIBIT
C
Form of
Foothill Filings
EXHIBIT
D-[___]
[______________]
Report
See
attached.
[Please
make cover sheet for each report.]
2
EXHIBIT
J-2
November
_, 2007
Вanс of America
Leasing & Capital, LLC
Bank of
America
МА5-100-32-01
000
Xxxxxxx Xx.
Xxxxxx,
XX 00000
Attn.:
Xxxxxxxxx X. Xxxxxx, VР
Group
Operations Manager
The
Lenders listed on Schedule 1.01(d) of the Term Loan Agreement
|
|
Re:
|
Term
Loan Agreement (the “Loan
Agreement”), dated as of November 2, 2007, by and among the
Borrowers, Parent, Banc of America Leasing & Capital, LLC, as
administrative agent (“Administrative
Agent”), Banc of America Leasing & Capital, LLC, as collateral
agent (“Collateral
Agent”, and together with Administrative Agent, the “Agents”), and
the various financial institutions and other institutional investors which
are parties thereto from time to time, as Lenders (collectively, the
“Lenders”, and
together with the Administrative Agent and Collateral Agent, the “Lender
Parties”).
|
Ladies
and Gentlemen:
We are special counsel to the Agents in
the State of Alabama (the “State”) in connection with the negotiation, execution
and delivery of the Loan Agreement among Borrowers, Parent, the Agents and the
Lenders listed on Schedule 1.01(d) thereof, and the other Loan Documents to be
executed or delivered to the Agents or such Lenders by one or more of the Loan
Parties, and the term loan facility made available thereunder (the “Loan”). This
opinion is being furnished to you pursuant to Section
4.01(а)(viii) of the Loan Agreement. Unless the context shall otherwise
require, capitalized terms used and not defined herein shall have the meanings
assigned thereto in Article I of the Loan Agreement.
In rendering this opinion, we have
reviewed unexecuted forms of the following documents (collectively, the “Documents”):
1. The Loan
Agreement;
2. Mortgage,
Assignment of Rents, Security Agreement and Fixture Filing (the “Alabama Mortgage”)
from Cherokee Nitrogen Holdings, Inc., an Oklahoma corporation (the “Alabama Mortgagor”),
as mortgagor, to the Collateral Agent, as mortgagee, encumbering certain real
and personal property in Colbert County, Alabama (the “Property”);
Banc
of America Leasing & Capital, LLC
The Lenders listed on Schedule 1.01(d)
of the Term Loan Agreement
November __, 2007
Page 2
3. Assignment
of Leases and Rents and Subordination Agreement from Cherokee Nitrogen Holdings,
Inc., as assignor, and Cherokee Nitrogen Company, as lessee (the “Cherokee Lease
Assignment”); and
4. Assignment
of Leases and Rents, Subordination [AND NONDISTURBANCE] Agreement from Cherokee
Nitrogen Holdings, Inc., as assignor, and Airgas Specialty Products, Inc., as
lessee; Assignment of Leases and Rents, Subordination [AND NONDISTURBANCE]
Agreement from Cherokee Nitrogen Holdings, Inc., as assignor, and Xxxxxx
Xxxxxxxx, LLC, as lessee; Assignment of Leases and Rents, Subordination [AND
NONDISTURBANCE] Agreement from Cherokee Nitrogen Holdings, Inc., as assignor,
and Austin Power Company, as lessee; and Assignment of Leases and Rents,
Subordination and Nondisturbance Agreement from Cherokee Nitrogen Holdings,
Inc., as assignor, and Xxxxxx Farms, as lessee (collectively, the “Third Party Lease
Assignments”, and together with the Cherokee Lease Assignment, the “Lease Assignments”;
the Lease Assignments and the Alabama Mortgage sometimes referred to herein as
the “Alabama Security
Documents”); and
5. Copies of
Form UCC-l Financing Statements made by the Alabama Mortgagor, as debtor, in
favor of Collateral Agent, as secured party, to be filed in the land records of
Colbert County, Alabama (the “Local Filing”) or
with the Secretary of State of Oklahoma (the “Central Filing”, and
collectively with the Local Filing, the “Financing
Statements”), as applicable.
In addition, we have examined originals
or copies, certified or otherwise identified to our satisfaction, of such other
documents and records and have made such examination of law as we have deemed
appropriate in order to enable us to render the opinions set forth herein. In
conducting such investigation, we have relied, without independent verification,
upon certificates of officers of the Lender Parties, public officials and other
appropriate persons, and on the representations and warranties as to matters of
fact and on the covenants as to the application of proceeds contained in the
Loan Documents.
We have
not made or undertaken to make any investigation as to factual matters or as to
the accuracy or completeness of any representation, warranty, data or any other
information, whether written or oral, that may have been made by or on behalf of
the parties to the Documents or otherwise (but have no actual
knowledge of the inaccuracy or incompleteness of any of the same), and we
assume, in giving this opinion, that none of such information, if any, contains
any untrue statement
of а material fact.
On the
basis of the assumptions and subject to the qualifications, exceptions and
limitations set forth herein, we are of the opinion that:
1. You have
asked our advice regarding whether any Lender is required to qualify to do
business as а
foreign entity in the State solely by virtue of its execution, delivery
and performance of
the Loan Documents to which it is а party, the making of the Loan and the
recording by an independent third party of the Alabama Mortgage in the Probate
Office of Colbert County, Alabama (collectively, the “Limited Alabama
Contacts”). As used in this letter,
Banc
of America Leasing & Capital, LLC
The Lenders listed on Schecule 1.01(d)
of the Term Loan Agreement
November __, 2007
Page 3
being а Lender in
connection with the Loan means only the following activities (or any one
or more of them)
conducted nor or in such party’s offices and outside of the State: (а) collection
of payments made under the Loan Documents, (b) administration of and
disbursements of funds and payments under the Loan
Documents, (с) providing and receiving written notices to and other
communications using the United States mail or other instrumentalities of
interstate commerce, (d) collecting and distributing operating and financial
information related to the Loan Documents, (е) monitoring
of compliance with the terms and conditions of the Loan Documents and (f)
being а mortgagee
and secured party under the Alabama Mortgage.
Article
XII, Section 232, of the Alabama Constitution of 1901 (“Section 232”)
provides that no foreign corporation shall do any business in the State without
having at least one known place of business and an authorized agent or agents
therein, and without filing with the Secretary of State of the State а
certified copy of its articles of incorporation or association. Under
Section 232, limited liability companies most likely would be regarded
as corporations.
At least
two early Alabama cases indicate that the predecessor to Section 232 independently disallowed а
foreign corporation doing business in the State the power to enforce its
contracts in the State if it was not qualified in the State at the time the
relevant contracts were executed. See, Xxxxxxx v. New England Mortgage Xxxxxxxx
Xx.,
0 Xx. 000 (Xxx. 1889); Xxxxxx
x. Xxxxxxx,
6 So. 304
(Ala. 1888). Alabama Corporate Code Section 10-2В-15.02 provides: “All
contracts or agreements made or entered into in this state by foreign
corporations prior to obtaining а certificate of
authority to transact business in this state shall be held void at the
action of the foreign corporation or any person claiming through or under the
foreign corporation by virtue of the contract or agreement.” If а Lender were deemed
to be “doing business” in the State but had not qualified to do business
in the State prior to the execution and delivery of the Loan Documents, such
party or parties holding interests under it may not be able to enforce the Loan
Documents in the State.
In Vines x. Xxxxx Beach, Inc., 670 So. 2d
901 (Ala. 1995), the Alabama Supreme Court reiterated that “nonqualified foreign
corporations are ‘prohibited from doing а single act
of business in this state, if done in the exercise of its corporate
function’ - - meaning, of course, the exercise of the function
or business it was organized to do, and not а purely incidental and
preparatory act.” Id.
The Vines court concluded that а
corporation that is doing business in the State who fails to qualify in
the State on or before the date its contracts are executed may be precluded
from enforcing such
contracts in the State.
Because
the activities that constitute “doing business” are not specifically defined by
the constitution,
statutes or cases of the State, а court’s “doing business” analysis
depends upon the facts of each case and the outcome of any particular case is
difficult to predict. You’re your permission, in addition to the other
assumptions, qualifications and limitations set forth elsewhere in this letter,
we have assumed the following in rendering the opinion expressed herein: (1) the
Lenders have ongoing business activities unrelated to the Loan; (2) the Lenders
do not have any offices, agents (other than the Collateral Agent acting as
collateral agent), employees, properties or assets in the State have not
conducted any solicitation or inducement in
Banc
of America Leasing & Capital, LLC
The Lenders listed on Schecule 1.01(d)
of the Term Loan Agreement
November __, 2007
Page 4
the State
with respect to the transaction and have not, are not and will not be exercising
their primary corporate function within the State; (3) none of the Loan
Documents have been executed or delivered in the State; (4) the negotiations
resulting in the execution and delivery of the Loan Documents occurred outside
the State or using means or instrumentalities of interstate commerce, and such
negotiations were concluded outside the State; (5) the Loan Documents are to be
performed and administered by the Lenders outside of the State; (6) the
transactions contemplated by the Loan Documents are to be performed and
administered by the Lenders outside the State; (7) the Lenders are not and will
not be acting as fiduciary in the State under or in connection with the Loan
Documents; (8) loan funds were not and are not to be disbursed in the State; (9)
payments under the Loan Documents are to be received and credited outside of the
State; (10) none of any Lender’s activities in connection with the Loan
Documents will occur in the State; and (11) that the Lenders have and had no
other contacts with and engaged in no other activities in the State. Thus, based
upon the foregoing assumptions and although contrary arguments exist, it is our
judgment that the Lenders should not be required to qualify to do business in
the State solely by virtue of the Limited Alabama Contacts. However, if the
Lenders intend to engage in other activities in the State, including, without
limitation, activities constituting performance or enforcement of the Loan
Documents in the State or relating to the operation, management, sale or other
disposition of any of the collateral or property covered by the Loan Documents as а
result of foreclosure, the exercise of any pre-foreclosure remedy or
otherwise, the Lenders should obtain further advice regarding requirements for
qualification to do business as а foreign entity in
the State.
Further,
you have asked our advice as to whether one Lender’s engaging in other
activities in the State in addition to the Limited Alabama Contacts which would
require that Lender to qualify to do business in the State, without first qualifying
to do business as а foreign entity in the State, would preclude the
Collateral Agent from enforcing the Loan Documents and foreclosing the Alabama
Mortgage for and to the extent of the other Lenders’ interests. Based upon the
foregoing, subject to the facts, assumptions and qualifications stated herein,
and recognizing that we have found no reported State decision on this question,
we believe that in
а properly
presented and argued case а court should conclude that one Lender’s
transacting business in the State without first qualifying where required to do
so will not preclude enforcement of the Loan Documents by the Collateral Agent
for the other Lenders, to the extent of such other Lenders’ interests, under
State law.
2. To the
extent that the law of the State is applicable, each of the Alabama Security
Documents constitutes the valid and binding obligations of the applicable Loan
Parties, enforceable by the Collateral Agent against such Loan Parties in
accordance with their respective terms. This opinion Paragraph 2 as
to enforceability of the Alabama Security Documents is also subject to the
qualification that certain provisions contained in the Alabama Security
Documents may not be enforceable, but such unenforceability will not render the
Alabama Security Documents invalid as а whole or preclude (х)
judicial enforcement of repayment, (y) acceleration of the Loan, or (z)
foreclosure, in accordance with the procedures prescribed by applicable law, of
the applicable Lender Parties’ rights, title and interests in and to the real
property and fixture
Banc
of American Leasing & Capital,LLC
The Lenders listed on Schedule 1.01(d)
of the Term Loan Agreement
November __, 2007
Page 5
collateral, in the event of а
material breach of а payment obligation or other material provisions of
the Alabama Security Documents. The opinions expressed in this opinion Paragraph
are governed by, and shall be interpreted in accordance with, the ACREL
Statement of Policy on Mortgage Loan Enforceability Opinions
(12/91).
3. (а) The Alabama Mortgage and
the Lease Assignments (including the acknowledgments attached thereto) are in
sufficient form for recording in the State pursuant to all generally applicable
laws thereof, including all generally applicable recording, filing and
registration statutes and regulations, and except as set forth hereinafter, no
other or further or subsequent filing, re-filing, recording, or re-recording in
the State of the Alabama Mortgage or any other instrument will be necessary to
continue the perfection of the liens, mortgages and security interests created
thereby. Other rules may apply in the event insolvency or bankruptcy proceedings
are commenced by or against the debtor listed in the Alabama Mortgage. We call
to your attention that Section 35-10-20 of the Code of Alabama provides that as
to third parties without actual notice or knowledge to the contrary, the
indebtedness secured by а mortgage covering
real estate twenty years past due according to the original maturity date or
some new date fixed by а duly recorded extension
agreement, or, if the maturity date cannot be determined therefrom, then
from the date of the mortgage, shall be conclusively presumed to have been
paid.
(b) The form
of the Alabama Mortgage (including but not limited to the description of the land
attached hereto as Exhibit А, assuming its correctness and completeness)
is sufficient to
create (i) а valid mortgage lien on that portion of the mortgaged
property thereunder
which constitutes real property and (ii) а valid security interest on
that portion of the mortgaged property thereunder which constitutes timber to be
cut, as-extracted collateral, or fixtures located or to be located on such real
property (all such real property, fixture and personal property collateral for
the Alabama Mortgage referred to herein collectively as the “Collateral”), in each
case of clauses (i) and (ii) above as security for the Secured Obligations (as
defined in the Alabama Mortgage).
(c) Upon the
due recording and proper indexing of the Alabama Mortgage in the land records
(the “Land
Records”) of the Office of the Judge of Probate of Colbert County,
Alabama (the “Recording Office”),
the Alabama Mortgage will provide constructive notice of the mortgage in favor
of the Collateral Agent, as security for the Secured Obligations, in that
portion of the mortgaged property referred to therein which constitutes real
property located in the State and the Collateral Agent will have а valid and perfected
security interest in the fixtures described therein.
4. The State
has no existing
statute of general application which denies to а real estate mortgagee any otherwise
existing right to seek а judgment against the mortgagor for any remaining
legally enforceable indebtedness owed by the mortgagor to the real estate
mortgagee, after application to the outstanding indebtedness of the proceeds of,
or credit resulting from, any foreclosure of the mortgage and sale of the
mortgaged property conducted in accordance with applicable law. In addition, in
the absence of special circumstances and any agreement to the
Banc
of America Leasing & Capital, LLC
The Lenders listed on Schedule 1.01(d)
of the Term Loan Agreement
November __, 2007
Page 6
contrary,
а mortgagee
may xxx for collection of the secured indebtedness and foreclose the
mortgage in whatever
order the mortgagee chooses. Further, Section 7-9А-604(а) of the Uniform
Commercial Code of the State (the “Alabama UCC”) provides that where а
security agreement covers both real and personal property, the secured
party may proceed as to both the real and the personal property in accordance
with the secured party’s rights and remedies in respect of the real property. Section
7-9А-604 does not address, and we express no opinion with respect to, whether а
secured party may proceed against real
estate and later proceed in а separate action against personal
property.
5. The
Financing Statements are in appropriate form for filing with the Recording
Office and the Secretary of State of Oklahoma, as applicable, and upon filing
will perfect, in favor of the Collateral
Agent, а lien or liens upon the collateral described in each of the
Financing Statements to the extent such lien or liens can be perfected by filing
in the States of Alabama and Oklahoma in such offices, as applicable. We call to
your attention to the fact that UCC Continuation Statements complying with the
Alabama UCC and the Uniform Commercial Code of Oklahoma as now in effect,
applicable, must be filed within the six (6) month period prior to the
expiration of the five (5) year period dating from the date of the original
filing of the Financing Statements and within the six (6) month period prior to
the expiration of each subsequent five (5) year period after the date of the
original filing of the Financing Statements. Other rules may apply in the event
insolvency proceedings are commenced by or against the Loan Parties or any other
debtor listed in the Financing Statements.
6. Neither
the execution and delivery of the Loan Documents, nor the fulfillment of or the
compliance with the provisions thereof, by Administrative Agent, Collateral
Agent or the Lenders, will result in а violation of, or
contravenes any law of the State known to us to be presently effective
having applicability.
7. Except
for the October 31, 2007 Mortgage Tax Order obtained from the Alabama Department
of Revenue, and the recordation or filing of the Alabama Security Documents and
the Local Filing in the Recording Office, no approval or other authorization of,
or registration with, any court or governmental agency, commission or other
authority of the State or any subdivision thereof is required for the due
execution, delivery, filing, recordation and enforcement in the State of the
Alabama Security Documents and the Local Filing, except for UCC continuation
statements.
8. Assuming
the Local Filing and the Lease Assignments are filed or recorded (as applicable)
simultaneously with the Alabama Mortgage as additional security for the
indebtedness secured thereby, the only taxes and governmental fees and charges
payable in the State in connection with the execution, delivery and recording of
the Alabama Mortgage and Lease Assignments in the State or the execution,
delivery or filing of the Local Filing in the State are nominal filing or
recording fees payable at the time of filing or recording of the Alabama
Mortgage, the Lease Assignments and the Local Filing, and the mortgage recording
privilege tax for
the Alabama Mortgage. Section 40-22-2 of the Code of Alabama imposes а privilege
tax in an amount equal to $0.15 per $100 (or fraction thereof) of the
indebtedness secured by mortgages
Banc
of America Leasing & Capital, LLC
The Lenders listed on Schefule 1.01(d)
of the Term Loan Agreement
November __, 2007
Page 7
and other
financing instruments which are recorded in Land Records of the Recording
Office. In order to avoid duplication of recording taxes, the Lease Assignments
and Local Filing should: (i) contain а statement substantially
as follows: “This instrument is filed as additional security for а mortgage
recorded simultaneously herewith upon which the mortgage recording tax has been
paid”; and (ii) be filed in the Recording Office at the same time as the Alabama
Mortgage is filed in such office. No taxes are, under the generally applicable
law of the State, required to be withheld or otherwise deducted from any amounts
payable to the Lender Parties under the Loan Documents. Except as set forth in
this opinion Paragraph 8, we express no opinion as to whether any taxes may or
may not be due as а
result of the transaction contemplated by the Loan
Documents.
9. If the
internal laws of the State were applicable thereto, the rates of interest under
the Loan Documents would be governed by Section 8-8-5 of the Code of Alabama,
which permits the parties to agree upon the interest rate to be charged (subject
to principles of unconscionability and to the extent not
deemed а penalty) for loans of $2,000 or more. Other than Section 8-8-5,
no statute of the State establishes any usury limits applicable to the Loan
Documents. The rates of interest to be charged and paid by the Borrowers under
the Loan Documents are not usurious under State law.
10. Although
State and federal courts exercise broad discretion in conflicts of law matters,
if properly presented with the issue, а State court or
а federal court in the State applying Alabama choice of law rules should
enforce provisions of the Loan Documents designating New York law as the
applicable or governing law for such documents except (i) to the extent the
application of New
York law would (а) contravene the public policy of the State; provided,
subject to all assumptions, qualifications and exceptions set forth in this
opinion, we know of no such public policy of State which would be so contravened
or (b) be inconsistent with Section 301(c) of the Alabama UCC, and (н)
we express no opinion with respect to which jurisdiction’s laws would
govern (а)
procedural matters, (b) the maximum amount of interest which may be
charged or collected under the Loan Documents, (e) except as set forth in
opinion paragraphs 2 and 3 above, the creation, perfection (and the effect of
non-perfection) or priority of any mortgages, liens, pledges, assignments and
security interests in property or interests in property, (d) except as set forth
in opinion paragraphs 2 and 3 above, any foreclosure, sale, appointment of а receiver or other
exercise of
remedies, or (е) matters relating to the internal affairs of
corporations, trusts, limited liability companies, partnerships or similar
entities.
11. The State
has no generally applicable law requiring any certification or notification to
State or local governmental authorities as а result of
а sale, conveyance, lease, mortgage of or foreclosure of а mortgage on
real property located in the State. We call to your attention that the
Collateral Agent will want to record the Alabama Mortgage in the Office of the
Judge of Probate of the county in the State where the real property covered by
the Alabama Mortgage is located.
Вanс of America
Leasing & Capital, LLC
The
Lenders listed on Schedule 1.01(d)
of
the Term Loan Agreement
November___,
2007
Page
8
The
foregoing opinions are qualified with and subject to the following
exceptions:
(i) We
express no opinion regarding any provision of any of the Loan Documents which purports (а) to
permit any party to sell or otherwise dispose of any collateral subject
thereto, or enforce any other remedy thereunder except in compliance with
applicable law, or (b) to vary or change by agreement any provision of
applicable law which may not, by the terms of applicable law, be varied or
changed by agreement.
(ii) We
express no opinion with respect to the title or other rights of the Loan Parties
or any other person to any collateral or property covered by any of the Loan
Documents. Except as set forth in opinion paragraphs 2, 3 and 5 above with
respect to the Alabama Mortgage and the Financing Statements, we express no
opinion regarding the creation or perfection (or the effect of non-perfection)
of any security interest, mortgage, lien, assignment or pledge. Without limiting
the foregoing, we express no opinion regarding any security interests arising or
deemed to arise under any subordination or similar agreements or the
consequences of failing to perfect any such security interests. We express no
opinion regarding the priority of any security interest, mortgage, lien,
assignment or pledge or regarding continuation of perfection or any manner in
which а security
interest, mortgage, lien, assignment or pledge or the perfection thereof
may be lost, terminated or otherwise affected or the exercise of any
rights or remedies which require the approval of or notification to any
governmental authority. No opinion is expressed herein regarding any matter
relating or pertaining to any security interest or the perfection of any
security interest, any conflicting security interest (or the proper place to
search for the same), assignment, mortgage, license, lien and/or pledge of, in
or with respect to:
(a) any
accounts or receivables that are or will be due from the United States, from any state of the United
States, from any agency or department of the United States or of any state or
from any other
government or agency or department thereof;
(b) any
property or interests in property excluded from Article 9А of the
Alabama UCC under
the provisions thereof (including, without limitation, Section 7-9А-109
of the Alabama UCC) or otherwise not governed by said Article 9А of the Alabama
UCC or with respect to which creation or enforcement is governed by the laws
(including the conflict of laws rules) of any state or jurisdiction other than
the State (including, without limitation, the United States and/or any foreign
country) or the perfection and effect of perfection or non-perfection is
governed by the laws (including the conflict of laws rules) of any state or
jurisdiction other than the States of Alabama and Oklahoma (including, without
limitation, the United States and/or any foreign country);
(c) any
property or interests in property including, without limitation, contracts,
agreements or other instruments (or of any rights of the Loan Parties, or any
other person thereunder) that contain provisions (or are subject to laws or
decisions) that prohibit or impose conditions upon the granting of an
assignment, security interest, pledge or similar transfer of such property,
contracts, agreements or instruments (or the
Bancj
of America Leasing & Capital, LLC
The Lenders listed on Schedule 1.01(d)
of the Term Loan Agreement
November __, 2007
Page 9
Loan
Parties’ or any other person’s rights thereunder), except to the extent, if any,
that such provisions
are ineffective under Sections 7-9А-406, 7-9А-407, 7-9А-408, or 7-9А-409
of the Alabama UCC (to the extent applicable);
(d) any
interest in property which is or will constitute or consist of fixtures,
equipment or goods used in farming operations, perishable agricultural
commodities or any inventory of food or other products derived therefrom, farm
products, accounts or general intangibles arising from or relating to the sale
of farm products by а xxxxxx, crops
growing or to be grown, sand, gravel, minerals, mining rights or the like
(including oil and gas), or accounts resulting from the sale thereof, consumer
goods, timber, timber to be cut, insurance policies or any proceeds thereof or
rights thereunder, aircraft, vessels, money, cash or cash equivalents, chattel
paper, uncertificated securities, documents, instruments, investment property,
commercial tort claims, railroad equipment, patents, patent licenses,
copyrights, copyright licenses, trademarks, trademark licenses, licenses, trade
names, service
marks, logos and the like, deposit accounts, beneficial interests in а
trust or а
decedent’s estate, letters of credit, letter of credit rights, supporting
obligations, consigned goods, inventory and equipment which are not in the
physical possession of the Borrowers [grantor of the relevant security interest]
or which are the subject of any documents of title, instruments, accessions,
products, or any property which is or is to be installed in or affixed to or
become а part of а
product or mass with other goods;
(e) proceeds
of collateral except to the extent а continuously perfected security
interest in such property exists under Section 7-9А-315 of the Alabama UCC;
or
(f) any
collateral transferred , disposed of or consumed in accordance with the terms of
the Loan Documents or with the consent of the Lenders;
(g) any
security interest granted by а “broker”,
“securities intermediary” or “commodities intermediary” in investment property;
or
(h) any
property or interest in property acquired or arising after the commencement of а case
under the United States Bankruptcy Code.
(iii) Except as
set forth in opinion paragraph 3 above with respect to real property, and
opinion paragraph 5 above with respect to personal property, we express no
opinion regarding which jurisdiction’s laws govern the creation, perfection (and
effect of perfection or nonperfection) or priority of any mortgages, liens,
pledges, assignments and security interests under the Loan Documents or govern
any foreclosure, sale, appointment of receiver or other exercise of remedies
with respect to any other collateral.
(iv) We
express no opinion regarding the perfection of any security interest, mortgage,
assignment, lien,
pledge or other rights in or with respect to (а) any automobiles, trucks
or other motor vehicles or any mobile homes, manufactured homes or trailers, or
(b) any other property subject to а certificate
of title or other similar registration, recordation, filing or
certification
Banc
of America Leasing & Capital, LLC
The Lenders listed on Schedule 1.01(d)
of the Term Loan Agreement
November __, 2007
Page 10
(other than filing а
financing statement under the Alabama UCC or Section 9-501 of the Uniform
Commercial Code as currently in effect in Oklahoma).
(v) We
express no opinion regarding any security interest that is or purports to be
а security
interest in а
security interest.
(vi) In the
ease of any instrument, chattel paper, account or general intangible that is
itself secured by other property, we express no opinion with respect to
Collateral Agent’s or any other person’s rights in and to such underlying
property.
(vii) We
express no opinion regarding the existence, adequacy, payment or receipt of
consideration (all of which we assume for purposes of the opinions expressed
herein).
(viii) We
express no opinion with respect to any provision of any of the Loan Documents
constituting or
relating to (а) waivers; (b) the availability of “self help” remedies; (е) the
occurrence of an event of default upon certain acts of bankruptcy, insolvency or
receivership; (d)
penalties or forfeitures; (е) unreasonable restraints on alienation or
any restrictions rendered ineffective by Alabama UCC Sections 7-9А-404, 7-9А-405, or
7-9А-40б; (f) remedies for defaults under the Loan Documents which are
determined by а
court to arise nor the Loan Parties’ or any other person’s compliance
with applicable law or which are determined by а court to be
non-material or without substantial adverse effect upon the rights of any person
or the ability of the Loan Parties to perform their material obligation; (g)
subrogation; or (h) rights or remedies granted to any person which are in
contravention of, or which modify such person’s standard of
care, or the rights of the Loan Parties or any other person to receive notice or
any other right prescribed by the Alabama UCC, as adopted and in effect nor time
to time, or other applicable law.
(ix) We
express no opinion regarding any provision of any of the Loan Documents (а) relating to
indemnities, powers of attorney, releases nor liability, exculpation,
severability, subordination (except as set forth in opinion paragraphs 2 and 3
above with respect to the Lease Assignments) or setoff, (b) which purports to
restrict, or to deny effect to, oral amendments, consents, waivers, releases or
similar defenses, (е) which permits, or purports to permit, any person to
seek or obtain specific performance or to select or enforce multiple or
inconsistent remedies, (d) specifying or indicating that а lender, creditor or
other person may apply funds to indebtedness in its discretion or in such
order as it may elect or providing for of funds to principal or charges prior to
the application thereof to interest, (е)
regarding the appointment or powers of, borrowings by or advances to а receiver or
the operation of or the exercise of any rights with respect to any collateral
prior to default and foreclosure or other disposition in accordance with
applicable law, (f) providing for late chargers or an interest rate after
а default greater than the rate applicable prior to such time or any provision which
provides for interest on interest (including past due interest, fees and
charges) or interest following judgment, (g) regarding the granting of rights
and interests in property not yet in existence or which is not adequately
described, (h) purporting to waive or establish trial by jury, venue,
jurisdiction or standards for service of process, (i) regarding any consent to
relief nor or waiver of the benefits
Banc
of America Leasing & Capital, LLC
The Lenders listed on Schedule 1.01(d)
of the Term Loan Agreement
November __, 2007
Page 11
of а bankruptcy stay, (j)
regarding marshalling of assets, (k) regarding the priority on
distribution of any person’s assets, (1) which is in the nature of an “agreement
to agree”, (m) purporting to render assignments or obligations absolute or
unconditional, to permit а person to fail to
comply with applicable law or to disclaim or restrict liability for actions
taken in reliance upon advice of counsel or for negligence or other wrongful
acts, (n) except as set forth in opinion paragraph 3(b) above regarding the
sufficiency of the description of real estate, regarding the characterization of
property as realty or personalty, (о) purporting to
incorporate unrecorded documents or the terms thereof into recorded
documents or the sufficiency or effect thereof, (р) regarding the
effectiveness of the Alabama Mortgage as а financing
statement or fixture filing, (q) regarding assumption or allocation of
risks, (r) providing for the assignment of permits, licenses or other rights and
approvals issued by governmental officials, boards or authorities, (s) except as
set forth in opinion Paragraph 10 above, regarding conflict or choice of law,
(t) purporting to prevent the merger of estates or interest in real property,
(u) purporting to bind or encumber persons and/or the property of persons who
are not parties to the Loan Documents, (v) purporting to indemnify or exculpate
any party against the consequences of its own negligence, gross negligence,
breach of contract, recklessness, willful misconduct, fraud or illegal conduct,
(w) except as set forth in opinion Paragraph 9 above, regarding usury or rules
of construction, usage or interpretation, (х)
regarding а party’s right to collect а
deficiency judgment except in compliance with applicable
law, or (у) as they relate to the effect of course of dealing, course of
performance or the like that could modify the terms of an agreement or the
respective rights or obligations of the parties under such
agreement.
(x) We
express no opinion regarding, and our opinions expressed herein are subject to,
the “Blue Sky” and securities laws, rules and regulations of the State and of
the United States.
(xi) We
express no opinion regarding, and our opinions expressed herein are subject to
limitations and restrictions contained in the Loan Documents on rights and
remedies and the effects thereof, and the applicability and effect of the tax
laws, rules and regulations of the State.
(xii) We
express no opinion regarding any arbitration, mediation or alternative dispute
resolution provisions of any of the Loan Documents.
(xiii) We
express no opinion as to the validity or enforceability of any security
interests under the Loan Documents as security for any present or future
liabilities or obligations that are determined, in the case of liabilities or
obligations created in the future, not to constitute “future advances” within the meaning of
Section 7-9А-204 of the Alabama UCC, or which are determined not to have
been within the contemplation of the parties at the time the Loan Documents were
executed, or which are determined not to be of the same character or class as
the liabilities and obligations created under the Loan Documents.
(xiv) We
express no opinion as to the effect of the terms present in the Loan Documents
to the extent that such terms used therein are defined in any other documents,
or to the extent that any other document may modify or affect the terms of the
Loan Documents.
Banc
of Anerica Leasing & Capital, LLC
The Lenders listed on Schedule 1.01(d)
of the Term Loan Agreenent
November __, 2007
Page 12
(xv) We
express no opinion whether an unrecorded document that is incorporated by reference in а recorded
document has the effect of according the referenced document the status
of а recorded
document or providing record notice of the contents of such referenced
document; however, we are not aware of any requirement that any of the
Loan Documents other than the Alabama Security Documents and the Financing
Statements be recorded or filed.
(xvi) We
express no opinion as to any provision providing for the payment of interest at
the “highest lawful rate” or similar language.
(xvii) The Loan
Documents and foregoing opinions are subject to (а)
bankruptcy, insolvency, reorganization, fraudulent conveyance, fraudulent
transfer, general assignment for the benefit of creditors laws and similar laws
of general application affecting the rights and remedies of creditors and
secured parties, equitable principles and the discretion of any court before
which any proceeding relating thereto may be brought; (b) standards of good
faith, conscionability, fair dealing and
reasonableness; and (с) the discretion of а court or other body to limit
or restrict the enforcement of the Loan Documents, or certain provisions
thereof, on the basis of public policy.
(xviii) Except
for our opinion in opinion Paragraph 5 above, opinions expressed herein are
limited to the generally applicable laws of the State, and, where applicable,
federal laws of the United States (with respect to federal laws, our opinion is
limited to laws that, in our experience, are normally applicable to transactions
of the type contemplated by this opinion letter). Our opinion in opinion
Paragraph 5 above with respect to the laws of the State of Oklahoma is based solely upon а
review of Sections 9-301, 9-307, 9-308, 9-310, 9-312, 9-501,
9502,9-503,9-504 and 9-509 of the Uniform Commercial Code as currently in effect
in such state and excludes review of any official state commentary, state filing
office rules, or judicial or administrative decisions interpreting these
sections or any other review. We express no opinion as to the laws of any other
jurisdiction, including the laws of the United States. We express no opinion as
to the laws of any county, municipality or other political subdivision of the
State or any other state.
The
foregoing opinions are rendered on the basis of and qualified by the following
assumptions:
(i) We have
assumed, without investigation: (а) the
genuineness of all documents, instruments and certificates and the
signatures thereon not signed in our presence; (b) that where а document has been
examined by us in draft form, it will be or has been executed in the form of
that draft, and
where а number of drafts of а document have been examined by us all
changes thereto have
been marked or otherwise drawn to our attention; (с) the authenticity of
all documents submitted to us as originals and the conformity with originals of
all documents submitted to us as copies; (d) that the representations and
warranties of all parties contained in the Loan Documents and all certificates
of governmental officials and officers of the Loan Parties are true and correct
as to factual matters on the date hereof; (е) the
due authorization, execution and delivery of the Loan Documents by the
parties thereto and beneficiaries thereof;
Banc
of America Leasing & Capital, LLC
The Lenders listed on Schedule 1.01(d)
of theTerm Loan Agreement
November __, 2007
Page 13
(f) with
respect to each of the Loan Documents that designates New York law as the
governing law, each of such documents constitutes the valid, legal and binding
obligation of the parties thereto enforceable against each such party in
accordance with the terms thereof under the laws of such jurisdiction; (g) that
the choice of law in the Loan Documents is not for the purpose of evading the
usury or similar laws of any jurisdiction; and (h) that, with respect to the
Loan Documents and all other documents examined by us in connection with this
opinion, all parties have requisite power and authority to enter into and
perform all obligations thereunder. To the extent that this opinion relates to
or depends upon the legal, valid and binding character of any document as to any
party which executed such document, or to the enforceability of any such
document by or against any party which executed such document, we have assumed
the due authorization, execution and delivery of such document by such party,
the legality, validity and binding nature of the document as to such party, the
enforceability of such document against such party and that no party to the Loan
Documents has taken, will take or has failed or will fail to take any action which could create
а defense to the enforcement of the Loan Documents by or against such
parties or beneficiaries.
(ii) We have
assumed that each of the parties to and each of the beneficiaries of the Loan
Documents is duly and validly organized, existing and except to the extent of
our opinion in opinion Paragraph 1 above, qualified to do business and in good
standing under the laws of the jurisdiction of their organization, in the State
and in all other jurisdictions where they are doing business and have all
requisite power and authority to perform their obligations and agreements under
the Loan Documents and to enforce their rights and privileges under the Loan
Documents and to consummate the transactions contemplated by the Loan
Documents.
(iii) We have
assumed that each party to and beneficiary of the Loan Documents has and will
comply with all terms and conditions of the Loan Documents.
(iv) We have
assumed that any mortgages, security interests, pledges, assignments, liens and
the like purporting to arise under the Loan Documents (other than the Alabama
Security Documents) are valid and effective under, have attached and are
perfected under the laws of all jurisdictions applicable thereto.
(v) We have
assumed that the Loan Parties and any other debtors now have, or, with respect
to any after-acquired assets, properties, rights and interests, will have ,
rights in the collateral and other assets, properties, rights and interests
subject to, or purportedly subject to, any mortgage, security interest,
assignment, lien, pledge or similar interest under the Loan Documents (including
all rights in such assets, properties, rights and interests purported to be held
thereby), and all such collateral and other property exist and are correctly and
adequately described in the applicable Loan Documents. We have assumed further
that all real property and fixtures constituting collateral under the Alabama
Mortgage are and will be located at all times entirely in Colbert County,
Alabama as indicated in the Loan Documents and that all fixtures constituting
collateral are located on the land described in the Alabama
Mortgage.
Banc
of America Leasing & Capital, LLC
The Lenders listed on Schedule 1.01(d)
of the Term Loan Agreement
November __, 2007
Page 14
(vi) We have
assumed that the addresses for the Loan Parties appearing on the Financing
Statements constitute correct and complete mailing addresses for the Loan
Parties, and the addresses for the Lender Parties appearing on the Financing
Statements constitute correct and complete addresses for the Lender Parties from
which information concerning the security interests evidenced thereunder may be
obtained.
(vii) We have
assumed that the Lender Parties has given value under and in connection with the
Loan Documents.
(viii) We have
assumed that there has not been any breach of fiduciary duty, mutual mistake of
fact or misunderstanding, fraud, duress or undue influence on the part of any
party to or beneficiary of any of the Loan Documents with respect to the
transactions contemplated thereby.
(ix) We have
assumed that all documents and agreements incorporated in the Alabama Mortgage
by reference are valid, legal and binding obligations of the parties thereto
enforceable in accordance with their terms.
(x) We have
assumed that the Collateral Agent has not acted in а
manner inconsistent with any security interest granted under the Loan
Documents and has not released, modified or terminated any such security
interest, and there exists no agreement postponing the time of attachment of any
such security interest.
(xi) We have
assumed that no bankruptcy or insolvency proceeding is pending by or against any
of the parties to the Loan Documents.
(xii) We have
assumed that the proceeds of the Loan have been and will be used for business or
commercial purposes and not for personal, family, household or agricultural
purposes.
(xiii) We have
assumed that the execution, delivery and performance of the Loan Documents by
the parties thereto do not contravene, or constitute а default under, any
provision of any material agreement, judgment, injunction, order, decree
or other instrument which is binding upon any of such parties.
(xiv) We have
assumed that none of the parties to the Loan Documents is an “investment
company” within the meaning of the Investment Company Act of 1940, as
amended.
(xv) We
have assumed that the execution, delivery and performance of the Loan Documents
by the parties thereto will not violate the charter or articles of incorporation
or bylaws or other organizational documents of any such parties.
(xvi) We have
assumed that each of the Loan Parties has the right to convey the interests in
the collateral and mortgaged property that it purports to convey.
Banc
of America Leasing & Capital, LLC
The Lenders listed on Schedule 1.01(d)
of the Term Loan Agreement
November __, 2007
Page 15
(xvii) We have
assumed that there are no instruments or agreements oral or written by or
between the parties with reference to the transactions contemplated by the Loan
Document which conflict with or purport to override, modify or amend any of the
Loan Documents and there has been no waiver of any of the provisions of the Loan
Documents by actions or conduct of the parties or otherwise.
(xviii) We
assume, without investigation or inquiry, that the execution, delivery and
performance of the Loan Documents and the consummation of the transactions
evidenced or secured thereby (а) do not require
any consent, authorization, approval or filing pursuant to the
Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976 or any rules or regulations
promulgated in connection therewith, and (b) are not prohibited by and do not
require any consent, authorization, approval or filing pursuant to the
Investment Company Act of 1940, as amended, the Employee Retirement Income
Security Act of 1974, as amended, or any rules or regulations promulgated in
connection with any of the foregoing.
Whenever
а statement herein
is qualified by the phrase “to the best of our knowledge” or а similar phrase, it is
intended to indicate that those attorneys in this firm who have rendered
legal services in connection with the transactions described herein do not have
an actual knowledge of the material inaccuracy of such statement; however,
unless otherwise expressly indicated, we have not undertaken any independent
investigation to determine the accuracy of any such statement, and no inference
that we have any knowledge of any matters pertaining to such statement should be
drawn from our
representation of the Administrative Agent.
This
opinion may be relied upon by the Administrative Agent and the Collateral Agent,
and their respective successors and assigns and each Lender (whether а party to
the Loan Agreement on the date hereof or becoming а party in the future), in
connection with the transactions contemplated by the Loan Documents. This
opinion may not be relied upon in any manner for any other purpose, or quoted
from or otherwise
referenced to in any document or report and may not be furnished to or relied
upon by any other person or entity or in any other opinion of any other persons,
including any counsel or accountant, for any purpose, without our prior written
consent. This opinion is an expression of professional judgment regarding the
legal matters
addressed and not а guaranty that а court will reach any particular
result. This opinion is limited to the matters stated herein and no opinion may
be implied or inferred beyond the matters expressly stated herein. This opinion
is as of the date hereof and we assume no obligation to update or supplement
this opinion to reflect any facts or circumstances which may hereafter come to
our attention or any changes in the facts, circumstances or law which may
hereafter occur.
Very
truly yours,
XXXXX
& XXXXXXX LLP
By ___________________
EXHIBIT
J-3
FRIDAY XXXXXXXX & XXXXX
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ATTORNEYS
AT LAW
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A
LIMITED LIABILITY PARTNERSHIP
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RAGENEA
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GUY
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TELEPHONE
000-000-0000
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WYCKLIFF NISERT, JR., P.A.
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PRICE
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FAX
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FAYETTEVILLE,
ARKANSAS 72703-4811
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November
____, 2007
Bank of
America Leasing & Capital, LLC, as
Administrative
Agent and Collateral Agent
MA5-100-32-01
000
Xxxxxxx Xxxxxx
Xxxxxx,
Xxxxxxxxxxxxx 00000
and the
Lenders listed on Schedule 1 hereto
Re:
Term Loan
Agreement (the “Loan
Agreement”), dated as of October 31, 2007, by and among the Borrowers,
Parent, Administrative Agent, Collateral Agent and the various financial
institutions and other institutional investors which are parties thereto from
time to time, as Lenders.
Ladies
and Gentlemen:
We have acted as special counsel to the
Agents and the Lenders in the State of Arkansas (the “State”) in
conjunction with the loan transaction that is the subject of the Loan
Agreement.
In connection with this opinion, we
have examined execution copies of the following loan documents and instruments
(collectively, the “Documents”):
1. Loan
Agreement;
2. Mortgage, Assignment of Rents and
Security Agreement, and Fixture Filing Statement (the “Arkansas
Mortgage”) made by
Northwest Financial Corporation, an Oklahoma corporation, one of the listed
Borrowers in the Loan Agreement (“Mortgagor”) in favor of Collateral Agent, with
respect to a first mortgage lien on certain real property and improvements
November __, 2007
Page 2
located
in Union County, Arkansas, and being more particularly defined therein (the
“Mortgaged
Property”);
3. an
Assignment and Subordination of Leases made by Northwest Financial Corporation,
an Oklahoma corporation, one of the listed Borrowers in the Loan Agreement in
favor of Collateral Agent, with respect to certain third-party leases affecting
all or portions of the Mortgaged Property (the “Third Party Assignment and
Subordination of Leases”) and an Assignment and Subordination of Leases
made by Northwest Financial Corporation, an Oklahoma corporation, one of the
listed Borrowers in the Loan Agreement in favor of Collateral Agent, with
respect to certain intra-company leases affecting all or portions of the
Mortgaged Property (the “Intra-Company Assignment and
Subordination of Leases”) (the Third Party Assignment and Subordination
of Leases and Intra-Company Assignment and Subordination of Leases are
collectively referred to hereinafter as the “Assignment of
Leases”) (the Arkansas Mortgage and the Assignment of Leases sometimes
being collectively referred to hereinafter as the “Security Documents”);
and
4. The UCC-l
Financing Statement and UCC-l Addendum to be filed together in the Recorder’s
Office (as such term is defined hereinafter) as a fixture filing (collectively,
the “UCC Financing
Statement”).
This opinion is being furnished to you
pursuant to Section 4.01(a)(viii) of the Loan Agreement. Unless the context
shall otherwise require, capitalized terms used and not defined herein shall
have the meanings assigned thereto in Article I of the Loan
Agreement.
In reaching the opinions set forth
below, we have assumed, and to our knowledge there are no facts inconsistent
with, the following:
(a) Each of
the parties to the Documents has duly and validly executed and delivered each
instrument, document, and agreement to be executed in connection with the credit
facility that is the subject of the Loan Agreement (the “Loan”) to which such
party is a signatory, and, except as to matters of State law regarding which we
opine as set forth below, such party’s obligations set forth in the Documents
are its legal, valid and binding obligations, enforceable in accordance with
their respective terms.
(b) Each
person executing any of the Documents, whether individually or on behalf of an
entity, is duly authorized to do so.
(c) Each
natural person executing any of the Documents is legally competent to do
so.
(d) All
signatures on the Documents are genuine.
(e) All
Documents submitted to us as originals are authentic; all Documents submitted to
us as certified or photostatic copies conform to the original document, and all
public records reviewed are accurate and complete.
November
__, 2007
Page 3
(f) The Documents executed by
Administrative Agent, Collateral Agent, Lenders, Borrowers, and the other
parties thereto, as applicable, are identical to the unexecuted copies of such
documents provided to us for review.
(g) The
Mortgagor under the Arkansas Mortgage has good, fee simple title to the
Mortgaged Property set forth therein.
(h) All
recording fees required to be paid in connection with the recording of the
Arkansas Mortgage, the Assignment of Subordination of Leases, and the UCC
Financing Statement have been paid.
(i) The
Lenders have given value in connection with the Documents, and there is actual
consideration given and received for the making of the Arkansas Mortgage by the
Mortgagor identified therein.
The opinions below are limited to the
laws, rules and regulations of the State and of the United States.
Based upon the foregoing, we are of the
opinion that:
1. The
Lenders are not required under the laws of the State to qualify as a foreign
corporation or otherwise qualify in the State or to file a designation for
service of process or similar type of filing in the State solely as a result of
their execution, delivery and performance of the Documents to which they are a
party.
2. Each of
the Arkansas Mortgage and Assignment and Subordination of Leases constitute the
legal, valid and binding obligation of the parties thereto enforceable against
each such party in accordance with the terms thereof, except as such
enforceability may be limited by applicable bankruptcy, insolvency and similar
laws affecting creditors’ rights generally and by general equitable
principles.
3. Each of
the Arkansas Mortgage and Assignment and Subordination of Leases is in proper
from for recording in the Office of the Circuit Clerk and Ex-Officio Recorder of
Union County, Arkansas (the “Recording
Office”).
4. The
Arkansas Mortgage is in form sufficient under the laws of the State to create
valid liens or security interests in favor of the Collateral Agent in the
Collateral described therein which constitutes real property or fixtures
thereto, and, when recorded with the Recording Office, will have been filed or
recorded in all public offices in the State in which such filing or recording is
necessary to perfect the lien of the Collateral Agent in the Collateral
described therein which constitutes real property or fixtures thereto. The
Arkansas Mortgage provides the Collateral Agent with all mortgage remedies
customarily obtained by mortgage lenders in the State in connection with the
type of loan and security provided for by the Arkansas Mortgage. The foreclosure
of the Arkansas Mortgage would not restrict, affect or impair the liability of
any of the Loan Parties with respect to the obligations secured thereby or by
the other Collateral
November
__, 2007
Page 4
Documents
or the rights or remedies of the Collateral Agent with respect to the
foreclosure or enforcement of any other security interests or liens securing
such obligations to the extent any deficiency remains unpaid after application
of the proceeds of the foreclosure.
5. The Laws
of the State do not require a lienholder to make an election of remedies where
such lienholder holds security interests and liens on both the real and the
personal property of a debtor or to take recourse first or solely against or
otherwise exhaust its remedies against its collateral before otherwise
proceeding to enforce against such debtor the obligations of such
debtor.
6. The UCC
Financing Statement which is to be recorded or filed within the State,
the form of which is attached hereto, is in form sufficient under the laws of
the State for filing or recording in the Recorder’s Office as a fixture filing,
and when recorded with the Recorder’s Office will have been filed or recorded in
all public offices in the State in which such filing or recording is necessary
as a fixture filing to perfect the interests of the Secured Parties in the
Collateral described therein which constitutes fixtures, as-extracted
collateral, or timber to be cut, to the extent the same can be perfected by
filing or recording in the State in such Recorder’s Office.
7. Neither
the execution and delivery of the Documents, nor the fulfillment of or the
compliance with the provisions thereof, by Administrative Agent, Collateral
Agent or the Lenders, will result in a violation of, or contravenes any Laws of
the State. Other
than as specifically set forth herein in Paragraph 10 hereinbelow, we do not
opine on the application of the usury laws of the State of Arkansas to the
transaction that is the subject of the Loan Agreement.
8. Except
for the filings and recordings described above, no approval, consent, or
withholding of objection on the part of, or filing or registration with, any
Governmental Authority is required to be made or taken in the State to
establish, protect and preserve title to, interests in, liens on and security
interests in the Collateral constituting real property, fixtures, timber to be
cut, or as-extracted collateral, as contemplated by the Documents, except for
UCC
continuation statements.
9. Except
for nominal filing or recording fees payable at the time of filing or recording
of the Arkansas Mortgage, the Assignment and Subordination of Leases, and the
UCC
Financing Statement, no taxes, fees or other charges imposed by the
State, Union County, Arkansas, or any other local governmental entity are
payable by the Administrative Agent, the Collateral Agent, or the Lenders solely
as a result of the execution, delivery, performance, recordation or filing
(where applicable) of the Arkansas mortgage, Assignment and Subordination of
Lease, and UCC
Financing Statement delivered in connection with the transactions
contemplated thereby.
10. Commercial loans subject to Arkansas
law are subject to a usury cap found in the Arkansas Constitution at Article 19,
Section 13(a)(i), and A.C.A. Section 4-57-104, which provides, along with
further interpretation through Arkansas case law and Arkansas Attorney General
Opinions, that a lender may not charge more than five percent (5%) over the
Primary Credit Rate at the time of the contract. As of October 31, 2007, at
10:30 am COT, the overall
November
__, 2007
Page 5
maximum
rate of interest legally chargeable per Arkansas law is 10.25% per
annum. Per Arkansas law, certain fees charged by a lender and other charges which are
income to a lender in connection with the making of a commercial
loan are also deemed interest for purposes of determining the overall interest
rate applicable to the commercial loan, especially fees charged by a lender that
are not directly reimbursable to an unrelated third party for a particular
service provided by said unrelated third party related to the commercial
loan. A loan origination fee which is deemed interest may be spread
over the life of the loan at issue for purposes of determining its application
to the overall rate of interest charged by a lender. Assuming the Loan is made
as of October 31, 2007 at 10:30 am CDT and assuming that the overall rate of
interest applicable to the Loan does not exceed 10.25%, the Loan is not usurious
under Arkansas law.
11. Based
solely on our reliance on telephone conversations with representatives of the
Office of the Mayor of the City of El Dorado, Arkansas and the Office of the
County Judge of Union County, Arkansas, and that certain written zoning letter
from the County Judge of Union County, Arkansas dated as of October 30,2007, we
believe that (i) the Mortgaged Property lies outside of the city limits of the
City of El Dorado, Arkansas and outside of the zoning jurisdiction of the City
of El Dorado, Arkansas, and (2) there are no Union County, Arkansas zoning laws
applicable to the Mortgaged Property.
12. Arkansas
has adopted the Uniform Enforcement of Foreign Judgments Act, found at A.C.A.
Section 00-00-000, et seq. (the
“UEFJA”).
Assuming compliance with the UEFJA, a judgment rendered by a New York court with
proper jurisdiction over the subject matter thereof, with respect to the Loan,
will be treated in Arkansas in the same manner as a judgment rendered by a court
in the State of Arkansas.
In
addition to the assumptions set forth above, the opinions set forth above are
also subject to the following qualifications:
(a) We are
licensed to practice law only in the State and do not hold ourselves out to be
experts on the laws of any state other than the State. Our opinions are limited
to the laws of the State.
(b) The
foregoing opinion as to enforceability does not pass upon any questions of
enforceability that may arise under securities or antitrust laws of the State,
any other states, or the United States of America.
(c) We
express no opinion with respect to title to any of the Mortgaged Property, but
we assume with your consent that the Mortgagor in the Mortgage is the owner of
such Mortgaged Property. We express no opinion as to the accuracy of any
descriptions of the Mortgaged Property contained in the Arkansas Mortgage or any
of the Documents.
(d) We
express no opinion with respect to the relative priority of the liens or
security interests created by any of the Documents. We understand that, with
respect to the real property, you are relying upon a mortgagee’s title insurance
policy insuring your lien on
November
__, 2007
Page 6
such
property, and, with respect to the personal property, you are relying on UCC
searches provided by the applicable filing offices.
(e) In the
event of conflicts among the Documents, we express no opinion as to which
provision shall prevail.
(f) We
express no opinion as to the validity or enforceability of any provisions in any
of the Documents to the extent that such provisions purport to waive any
requirement of diligent performance or other care on the part of the
Administrative Agent, Collateral Agent or Lenders with respect to the
recognition or preservation of the rights of the Borrowers to or interest in any
property subject to the lien or security interest granted by the
Documents.
(g) We
express no opinion as to the validity or enforceability of (a) any remedies
which any of the Documents purport to grant the Administrative Agent, Collateral
Agent or Lenders with respect to the seizure or disposition of the personal
property to the extent that such remedies are not specifically provided to a
secured party under the applicable State Uniform Commercial Code, or (b)
remedies (excluding the power of sale provisions set forth in the Security
Instrument) which any of the Documents purport to grant to the Lenders with
respect to the seizure or disposition of the real property to the extent that
such remedies are not specifically provided for by the laws of the
State.
(h) We
express no opinion as to the validity or enforceability of any provision of the
Documents which permits the Lenders, in the event of acceleration upon
delinquency or default, to increase the rate of interest or to collect a late
charge or prepayment penalty or premium.
(i) We
express no opinion as to the validity or enforceability of any powers of
attorney granted or assigned in the Documents to the extent that the grant or
assignment of such powers of attorney does not comply with the requirements of
A.C.A. Sections 1812-501 and 21-6-306, and other applicable laws of the
State.
(j) We note
that in order for the Administrative Agent, Collateral Agent or Lenders to
obtain the appointment of a receiver, they must comply with the requirements of
A.C.A. Section 00-000-000, and Arkansas Rule of Civil Procedure 66, and other
applicable laws of the State.
(k) We
express no opinion as to the effect of future course of dealings, course of
performance or the like, in modifying the terms of any of the Documents or the
respective obligations of the Borrowers, any guarantors and the Administrative
Agent, Collateral Agent or Lenders under the Documents, and we note that the
validity or enforceability of provisions permitting modifications of an
agreement only in writing may be limited by the parties’ future course of
dealings, course of performance and the like.
November
__, 2007
Page 7
(l) We
express no opinion as to the validity or enforceability of waivers or advance
consents that have the effect of waiving marshaling of assets or similar
requirements or defenses, or in certain cases notices.
(m) We
express no opinion as to the obligation of any guarantors to pay the outstanding
principal balance of the obligations comprising the Loan and observe the
covenants under the Documents in the event that the time for payment for said
obligations is extended, a party is released from liability, a Document is
renewed, the terms of payment under the Documents are modified, any security
under the Documents is released or the terms of the Documents and security
therefor are made subject to a subordination agreement without the prior consent
of any guarantors to such modifications, amendments, releases or
subordinations.
(n) We
express no opinion with respect to the enforceability of the severability
provisions contained in the Documents to the extent that any provision affected
by the severability provision is material to the essence of the agreements set
forth in the Documents.
(o) We
express no opinion as to the validity or enforceability of any provisions in the
Documents concerning environmental indemnification to the extent that the same
are unenforceable under Federal or state environmental laws, ordinances or
regulations.
(p) We
express no opinion with respect to the validity or enforceability of provisions
in the Documents which provide that the Lenders is not liable for its acts or
omission or for any acts or omissions, servants, employees or attorneys,
including but not limited to negligence.
The
opinions set forth herein are expressed as of the date hereof, and we assume no
obligations to update or supplement these opinions to reflect any facts that may
hereafter come to our attention or any changes in law that may hereafter occur.
The opinions set forth herein are limited to matters expressly set forth herein,
and no opinion is to be inferred or implied beyond the matters expressly so
stated.
Except as set forth in the following
sentence, this opinion is being furnished solely for the benefit of you and your
successors and assigns, and your and their respective counsel, in connection
with the transactions contemplated by the Documents. The Administrative Agent
and the Collateral Agent, and their respective successors and assigns and each
Lender (whether a party to the Loan Agreement on the date hereof or becoming a
party in the future) may rely on this opinion to the same extent as if it were
addressed and delivered to such person on the date hereof. No other use of this
opinion may be made without our approval. Our opinions represent our reason and
judgment as to certain matters of law based upon facts presented or presumed and
are not and should not be considered or construed as a guaranty. The liability
of FRIDAY, XXXXXXXX &
XXXXX, LLP is limited to the fullest extent possible under Act 661 of
1987.
Sincerely,
November
__, 2007
Page 8
FRIDAY,
XXXXXXXX &
XXXXX, LLP
EXHIBIT
K
INTER-LENDER
AGREEMENT
THIS
INTER-LENDER AGREEMENT (this “Agreement”) dated as
of November 5, 2007 between XXXXX FARGO FOOTHILL, INC. (“Foothill”), a
California corporation, and BANC OF AMERICA LEASING & CAPITAL, LLC, a
Delaware limited liability company, in its capacity as collateral agent (in such
capacity, the “Term
Agent”) under that certain Term Loan Agreement (herein
defined).
W I T N E
S S E T H:
WHEREAS,
pursuant to a Term Loan Agreement
dated as of November 2,
2007 (the “Term Loan
Agreement”), by and among LSB Industries, Inc. (“Parent”),
ThermaClime, Inc. (“ThermaClime”), and
certain of ThermaClime’s subsidiaries, and one affiliate of ThermaClime that is
also a subsidiary of Parent (the subsidiaries and affiliate of ThermaClime,
together with ThermaClime, each a “Term Loan Borrower”
and collectively, the “Term Loan
Borrowers”), the lenders party thereto (the “Term Loan Lenders”),
the Term Agent, Bank of Utah as payment agent, and Banc of America Leasing &
Capital LLC as administrative agent, the Term Loan Lenders will make loans to
the Term Loan Borrowers;
WHEREAS,
to secure the obligations due under the Term Loan Agreement by the Term Loan
Borrowers, the Term Loan Borrowers have granted to the Term Agent liens on and
security interests in certain personal and real property (the “Term Collateral”),
including, but not limited to, mortgages listed on Schedule 1 hereto (the “Mortgages”), covering
the real property located at the respective addresses set forth on Exhibit A-1 and Exhibit A-2 attached
hereto, as more fully described in Exhibit B-1 and
Exhibit B-2
attached hereto and made a part hereof (the “Premises”);
WHEREAS,
reference is hereby made to that certain Amended and Restated Loan and Security
Agreement (the “Revolving Loan
Agreement”), dated as of November 5, 2007, by and among Parent,
ThermaClime and certain of its subsidiaries (together with Parent and
ThermaClime, the “Loan
Parties”), the persons from time to time party thereto as lenders (the
“Revolver
Lenders”), Foothill, as administrative agent for the Lenders (in such
capacity, the “Revolver
Agent”);
WHEREAS,
pursuant to the Revolving Loan Agreement, the Loan Parties have granted to
Revolver Agent a security interest in certain of their present and future
personal property (as more fully described therein), wherever located, excluding
equipment but including their inventory located on a Premises (the “Revolver
Collateral”), to secure the Loan Parties’ obligations under or in
connection with the Revolving Loan Agreement;
WHEREAS,
the Revolver Agent and the Term Agent desire to establish certain procedures and
confirm certain rights relating to Revolver Agents’ access to a portion of the
Term Collateral in order for Revolver Agent to dispose of the Revolver
Collateral; and
WHEREAS,
the execution and delivery of this Agreement is a condition to providing loans
and extensions of credit pursuant to the Revolving Loan Agreement and the Term
Loan Agreement.
NOW,
THEREFORE, for good and valuable consideration, the receipt and adequacy of
which consideration is hereby acknowledged by each party, and intending to be
legally bound, each party hereto hereby agrees as follows:
Section
1. DEFINED
TERMS.
(a) As used
herein, the following terms have the following respective meanings:
“Accounts Receivable” means all
the Loan Parties’ rights to payment for the sale of Inventory or rendition of
services, whether or not earned by performance, now existing or hereafter
arising prior to the Trigger Date or arising out of the sale of Applicable
Inventory before or after the Revolver Trigger Date and which is part of the
Revolver Collateral.
“Agents” means the Revolver
Agent and the Term Agent, and “Agent” means either of them,
together with their respective successors, assigns, or replacements in such
capacity.
“Applicable Inventory” means,
with respect to a Premises, Inventory of any Borrower that on the Revolver
Trigger Date is located at or in-transit to such Premises.
“Disposition Period” means,
with respect to a Premises the period commencing on the occurrence of the Term
Trigger Date applicable to such Premises and ending on the date that is the
earliest of: (a) 120 days following such Term Trigger Date (except
that such 120 day period shall be reduced by the number of days, if any, that
Revolver Agent has entered such Premises or used the Term Collateral as
described in Section 4(a), to the extent prior to the date that Term Agent or
any Term Loan Lender has control or possession of such Term Collateral, or has
sold such Term Collateral to a Successor Operator), or (b) the day on which all
Applicable Inventory (other than Inventory abandoned by the Revolver Agent) has
been sold or otherwise removed from such Premises.
“Closing Date License” has the
meaning given in Section
5(a).
“Collateral” means,
collectively, the Revolver Collateral and the Term Collateral.
“Enforcement Action” means any
of the following actions when taken by the Revolver Agent, the Term Agent, or
any Lender;
(a) enforcement
of a Lien in full or partial satisfaction of any Revolver Obligation or Term
Obligation, as the case may be, secured thereby;
(b) (i)
commencement of legal action against any Obligor or the Revolver Collateral or
Term Collateral, as applicable for foreclosure or replevin or other enforcement
of a Lien on the Collateral, or (ii) bidding on all or substantially all of the
Revolver Collateral or the Term Collateral, or both, at a foreclosure or like
sale;
2
(c) notification
of account debtors of any Obligor to make payment directly to it, as secured
party under Revolver Security Agreements or Term Security Agreements, as the
case may be;
(d) joining
any petition for the involuntary bankruptcy of any Obligor; or
(e) written
notification of: (i) default and demand for payment; or (ii)
acceleration.
“Lenders” means, collectively,
the Revolver Lenders and the Term Lenders and “Lender” means either of
them.
“Lien” means any mortgage,
pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien
(statutory or other), charge, or preference, priority, or other security
interest or preferential arrangement of any kind or nature whatsoever (including
any conditional sale or other title retention agreement, and any financing lease
having substantially the same economic effects as any of the
forgoing).
“Loan Documents” means,
collectively, the Revolver Loan Documents and the Term Loan
Documents.
“Notice of Enforcement” has the
meaning given in Section
2.
“Obligations” means
collectively, the Revolver Obligations and the Term Obligations.
“Obligor” means a Borrower
under the Term Loan Documents or Loan Party under the Revolver Loan
Documents.
“Propriety Rights” means all of
each Obligor’s now owned and hereafter arising or acquired: (a)
licenses, franchises, and permits; (b) patents and patent rights; (c) copyrights
and works that are the subject matter of copyrights; (d) trademarks, service
marks, trade names, trade styles; (e) patent, trademark, and service xxxx
applications and all licenses and rights related to any of the foregoing; and
(f) all other rights under any of the foregoing, together with all extensions,
renewals, reissues, divisions, continuations, and continuations-in-part of any
of the foregoing, and all rights to xxx for past, present, and future
infringement of any of the foregoing.
“Proprietary Rights Collateral”
has the meaning given in Section
5(a).
“Requesting Agent” has the
meaning given in Section
3.
“Responding Agent” has the
meaning given in Section
3.
“Revolver Agent” has the
meaning given in the Third Recital.
“Revolver Collateral” has the
meaning given in the Fourth Recital.
“Revolver Liens” means the
Liens of the Revolver Agent and the Revolver Lenders securing the Revolver
Obligations pursuant to the Revolver Loan Documents.
3
“Revolver Loan Documents” means
the “Loan Documents” as defined in the Revolving Loan Agreement.
“Revolver Trigger Date” means, with
respect to a Premises, the date that the Revolver Agent or a Revolver Lender
notifies the Term Agent of its intent to access such Premises for the purpose of
enforcing its rights and remedies, as a secured creditor, either by legal
process or otherwise with respect to the Inventory and other Revolver Collateral
located thereon.
“Successor License” has the
meaning given in Section
5(b).
“Successor Operator” means any
third party purchaser to whom a Premises is sold by Term Agent.
“Successor Revolver Agent” has
the meaning given in Section
6(b).
“Term Collateral” has the
meaning given in the Second Recital.
“Term Liens” means the Liens of
the Term Agent and the Term Lenders securing the Term Obligations pursuant to
the Term Security Agreements.
“Term Loan Documents” means the
“Loan Documents” as defined in the Term Credit Agreement and includes the Term
Credit Agreement and the Term Security Agreements.
“Term Obligations” means the
“Obligations” as defined in the Term Credit Agreement.
“Term Security Agreements”
means those certain security agreements executed by Obligors and delivered to
the Term Agent, pursuant to which the respective Obligors have granted liens and
security interests to the Term Agent (for the benefit of the Term Agent and the
Term Lenders) in certain of their respective assets, as more specifically
described in therein.
“Term Trigger Date” means, with
respect to a Premises, the date that Term Agent provides written notice to the
Revolver Agent of the occurrence of a Trigger Event with respect
thereto.
“Term Trigger Event” means,
with respect to a Premises, the Term Agent takes possession of such Premises
pursuant to or following an Enforcement Action, whether before or after a
foreclosure proceeding of action.
“Termination Activities” has
the meaning given in Section
6(b).
“Uniform Commercial Code” or
“UCC” means the Uniform
Commercial Code as from time to time in effect in the State of
California.
(a) Unless
otherwise expressly provided herein, references to agreements and other
contractual instruments shall be deemed to include all subsequent amendments,
restatements, extensions, supplements, and other modifications
thereto.
4
(b) Capitalized
terms used but not defined herein shall have the meaning given in the
UCC.
(c) Any
use of the term “including” herein shall mean, “including, without
limitation”.
Section
2. NOTICE OF
ENFORCEMENT. The Term Agent agrees to give to the Revolver
Agent written notice of any Enforcement Action pursuant to the Term Loan
Documents (each such notice, a “Notice of
Enforcement”). Notices of Enforcement shall be given in the
manner and to the respective addresses set forth in Section 10 of this
Inter-Lender Agreement, or to such other address specified by any party by
written notice to any other party. Notice of Enforcement shall be
given prior to or concurrent with the relevant Enforcement Action, except that
Term Agent may give a Notice of Enforcement promptly after taking the relevant
Enforcement Action if it in good faith believes that immediate Enforcement
Action is or may be required to protect its interest in the property subject to
its Liens. No liability or defense shall ever arise, no Lien shall
ever be lost, invalidated, or impaired, and no action taken in enforcement of a
Lien shall ever by annulled, set aside, affected, or impaired solely as a result
of the failure to give any notice required by this Section 2 in
accordance with this Inter-Lender Agreement. The Revolver Agent
agrees to give prompt written notice to the Term Agent of the occurrence of each
Revolver Trigger Date.
Section
3. ACCESS TO DOCUMENTS AND
RECORDS. Subject to confidentiality restrictions imposed by
law, contract, or agreement, if either Agent takes actual possession of any
documentation of any Obligor (whether such documentation is in the form
of a writing or is stored in any data equipment or data record in the
physical possession of such Agent), then upon request of either Agent (the
“Requesting
Agent”) and reasonable advance notice, the other Agent (the “Responding Agent”)
will permit the Requesting Agent or its representatives to inspect and copy such
documentation if and to the extent the Requesting Agent certifies to the
Responding Agent that:
(a) such
documentation contains or may contain information necessary or useful, in the
good faith opinion of the Requesting Agent, to the enforcement of Requesting
Agent’s Liens upon any Revolver Collateral or Term Collateral, as the case may
be; and
(b) the
Requesting Agent and the Revolver Lenders or Term Lenders, as the case may be,
are entitled to receive and use such information as against the applicable
Obligor or its suppliers, customers, and contracts and under applicable law,
and, in doing so, will comply with all obligations imposed by law or contract in
respect of the disclosure or use of such information.
Section
4. ACCESS TO
PREMISES.
(a) During
the Disposition Period for a Premises, if so requested by the Revolver Agent and
upon reasonable advance notice, the Term Agent will allow the Revolver Agent and
its officers, employees, and agents, at the sole risk, cost, and expense of the
Revolver Agent and the Revolver Lenders, reasonable and nonexclusive access to
and use of such Premises as necessary or useful in repossessing, removing,
manufacturing, completing,
5
preparing
for sale, marketing, selling, or otherwise disposing of, in any lawful manner,
any Applicable Inventory upon which the Revolver Agent holds a Lien under the
Revolver Loan Documents, or to collect or realize upon Accounts Receivable, and
to examine all books, records, and documents in connection with any Revolver
Collateral, subject, however, in all cases, to the covenants, conditions, and
limitations set forth in Section
4(c). If any Applicable Inventory will remain at such Premises
at the end of such Disposition Period, then, as soon as possible but in no event
later than the end of such Disposition Period, the Revolver Agent shall provide
the Term Agent with written notice that the Revolver Agent and the Revolver
Lenders elect to abandon such Inventory. If the Revolver Agent fails
to give any such notice required by this Section 4(a), the
Revolver Agent shall be deemed to have abandoned the remaining Applicable
Inventory at such Premises as of the end of the Disposition
Period. Upon the abandonment of any Applicable Inventory pursuant to
this Section
4(a), the Revolver Liens therein shall be deemed released and the Term
Agent shall have the authority to release such Liens in the abandoned Applicable
Inventory.
(b) Notwithstanding
anything in this Section 4 to the
contrary, if the Term Agent has entered into an agreement for the sale of all or
substantially all of the Term Collateral relating to a Premises in a bona fide
arm’s length transaction with a Successor Operator, the rights of the Revolver
Agent set forth in Section 4(a) above shall continue until the later of (i) the
date ninety (90) days after the date the Revolver Agent receives notice from the
Term Agent of such agreement or (ii) the date that the Successor Operator shall
require as a condition of such sale that possession of the Term Collateral be
given by the Term Agent or Term Loan Lender to such Successor
Operator. In connection with any such sale, Term Agent shall use
reasonable efforts to cause such purchaser to not require as a condition of the
sale that possession of the Term Collateral be given by Term Agent to such
Successor Operator prior to the end of the Disposition Period, or if such period
is not acceptable to the Successor Operator, then the longest period equal to or
greater than the ninety (90) day period provided for in this Section 4(b) which
may be acceptable (provided that such efforts by Term Agent and Term Loan
Lenders shall not be required if, in the reasonable judgment of Term Agent or
the Term Loan Lenders, such efforts could result in adverse terms or term
relating to the proposed sale (including a lower purchase price or less
favorable payment terms) to Successor Operator or could have a reasonable
likelihood of causing the sale not to occur or to be delayed). The
obligations imposed on Term Agent by this Section 4(b) and
Section 5(b)
below shall not apply with respect to sale to a Successor Operator which
purchase takes place at a foreclosure sale or a sale by operation of law or
court order.
(c) In
connection with the exercise of its or their rights under Section 4(a), the
Revolver Agent and the Revolver Lenders shall comply with the following with
respect to each Premises to the extent the Revolver Agent wishes to access such
Premises:
(i) All
activities of the Revolver Agent, any Revolver Lender, or their respective
officers, employees, and agents in connection with any obligation of the Term
Agent or any Successor Operator set forth in Section 4(a), subject
to Section
4(b): (A) will be permitted, lawful, and enforceable as
against each Obligor and its suppliers, customers, and contracts and under
applicable law and will be conducted in accordance with prudent manufacturing
practices; and (B) will not impose upon the Term Agent (or any holder of the
6
Term
Obligations), any Term Lender, or any Successor Operator any legal duty, legal
liability, or risk of uninsured loss.
(ii) With
respect to any liability coverage then being maintained by Revolver Agent,
individually or in its capacity as agent, with respect to the Revolver
Collateral or with respect to the activities described in Section 4(c)(i)
above, the Revolver Agent will deliver to the Term Agent a certificate of
insurance naming Term Agent and each of the Term Lenders as additional insureds
thereunder.
(iii) The
Revolver Agent and the Revolver Lenders shall cooperate with the Term Agent or
any Successor Operator of such Premises so as to minimize any interference with
the use and operation of such Premises by the Term Agent or any Successor
Operator thereof while permitting the Revolver Agent and the Revolver Lenders to
obtain the benefit of their rights under Section
4(a).
(iv) The
Revolver Agent and the Revolver Lenders shall follow all reasonable procedures
and regulations imposed by the Term Agent or the Successor Operator with respect
to such Premises.
(v) The
Revolver Agent and the Revolver Lenders shall pay to the Term Agent, the Term
Lenders, or Successor Operator of such Premises, as applicable, all costs and
expenses incurred by the Term Agent, the Term Lenders, or such Successor
Operator, respectively, in connection with, or reasonably attributable to, the
Revolver Agent’s and the Revolver Lenders’ or their agents’ storage,
examination, processing, shipping, production, completion, supply, sale, or
other disposition of the Applicable Inventory or collection, repossession or
sale of the Revolver Collateral at or with respect to such
Premises.
(vi) The
Revolver Agent and the Revolver Lenders, at their expense, shall repair any
damage to such Premises caused by their exercise of the rights contained in
Section
4(a).
(vii) The
Revolver Agent’s use of such Premises to process, ship, produce, store,
complete, supply, sell, or otherwise dispose of any Applicable Inventory shall
be limited to only those activities generally conducted at such Premises on or
prior to the applicable Revolver Trigger Date (e.g., the Revolver Agent may not
produce or process a product at a Premises that is not being regularly produced
at such Premises on or prior to such date).
Section
5. LICENSES OF PROPRIETARY
RIGHTS.
(a) The Term
Agent: (i) acknowledges and consents to the grant to the Revolver
Agent by the Obligors on the date hereof of a limited, non-exclusive
royalty-free license in the form of Annex A hereto (the “Closing Date
License”); and (ii) agrees that its Liens in the Term Collateral of the
type described in the Closing Date License (the “Proprietary Rights
Collateral”) shall be subject to the Closing Date License.
(b) If the
Term Agent becomes the owner of any Proprietary Rights as a result of the
exercise of remedies by Term Agent or Term Lender with respect to its Lien on
7
such
Proprietary Rights, then upon request of the Revolver Agent, the Term Agent
shall promptly provide written confirmation of the grant to the Revolver Agent
of, and does hereby irrevocably grant to the Revolver Agent, a limited,
non-exclusive royalty-free license in the form of the Closing Date License (a
“Successor
License”) to use any such Proprietary Rights. Any license so
granted by the Term Agent or the applicable Term Lender shall be binding on its
successors and assigns. Furthermore, to the extent the Term Agent
becomes the owner of any Proprietary Rights as a result of the exercise of
remedies by the Term Agent with respect to its Lien on such Proprietary Rights,
the Term Agent shall not make any subsequent sale or transfer of such
Proprietary Rights unless the purchaser or transferee thereof agrees in writing
to provide a Successor License to the Revolver Agent upon request.
(c) Each of
the Closing Date License, any Successor License, and any obligations of the Term
Agent in this Section
5 shall expire at the end (or earlier termination) of the Disposition
Period.
Section
6. HOLD
HARMLESS.
(a) Each
Obligor consents to the performance of by the Term Agent, and to the extent
applicable, the Term Lenders, and any Successor Operator, of the obligations set
forth in this Section
6 and acknowledges and agrees that neither the Term Agent nor any Term
Lender shall ever be accountable or liable for any action taken or omitted by
the Revolver Agent, the Revolver Lenders, or their officers, employees, and
agents in connection therewith or incidental thereto or in consequence thereof,
including any improper use or disclosure of any proprietary information or other
intellectual property by the Revolver Agent, the Revolver Lenders, or their
officers, employees, agents, successors, or assigns, or any other damage to or
misuse or loss of any property of the Obligors or the Term Collateral or
Revolver Collateral as a result of any action taken or omitted by the Revolver
Agent, the Revolver Lenders, or their respective officers, employees, agents,
successors, or assigns. Foothill, in its individual capacity and in
its capacity as Revolver Agent, on behalf of the Revolver Lenders, hereby agrees
to indemnify and hold harmless the Term Agent and the Term Lenders and any
Successor Operator for any losses, liabilities, claims, damages, penalties,
demands, actions, judgments, suits, costs, expenses, and disbursements
(collectively, “Losses”) to the
extent resulting from any action taken or omitted by the Revolver Agent, the
Revolver Lenders, or their respective officers, employees, agents, successors,
or assigns in the exercise of their rights described in Section 4 or Section 5(b), provided that if such Losses
result from the gross negligence or willful misconduct of one or more of the
Term Agent or any Term Lender, the Term Agent and/or Term Lender(s) committing
such gross negligence or willful misconduct will not have the benefit of the
foregoing indemnity in respect of any Losses attributable to such gross
negligence or willful misconduct.
(b) If
Revolver Agent, any Revolver Lenders or any other person acting through or on
their behalf have exercised any rights under Section 4 or Section 5(b) or
entered upon either Premises pursuant thereto, then prior to any resignation or
removal of Revolver Agent as “Agent”, the Revolver Agent shall either (i)
complete all Termination Activities (as herein defined) or (ii) cause the
Successor Revolver Agent (as herein defined) to provide Term Agent with an
indemnification from such Successor Revolver Agent consistent with that provided
pursuant to Section
6(a) hereof, and, if so requested by Term Agent, insurance
8
coverage
satisfactory to Term Agent (collectively, the “Successor Indemnity”)
(the date on which the earlier of (i) and (ii) occurs is the “Indemnity Limitation
Date”). Following the Indemnity Limitation Date, the
indemnification obligations of Foothill individually and as Revolver Agent under
Section 6(a)
shall terminate with respect to Losses to the extent such Losses result from any
action taken or omitted by a Successor Revolver Agent, or its respective
officers, employees, agents, successors, or assigns following the Indemnity
Limitation Date; provided, however, that nothing herein shall relieve Foothill
and the Revolver Agent of its indemnification obligations under Section 6(a) with
respect to any Losses resulting, in whole or in part, with respect to any acts
or omissions subject to the indemnification provisions under Section 6(a) which
occur on or prior to the Indemnity Limitation Date, including without limitation
the carrying out of any Termination Activities, whether or not claims for any
such Losses occur following the Indemnity Limitation Date. “Successor Revolver
Agent” shall mean the successor agent appointed upon the resignation or
removal of Revolver Agent as “Agent” as described in Section
11(a). “Termination
Activities” shall mean the termination and unwinding of all
activities of the Revolver Agent, the Revolver Lenders and their respective
officers, employees, and agents in connection with the exercise of rights
granted to Revolver Agent or the Revolver Lenders under Section 4 and Section 5(b) or any
activities conducted by any of them on either of the Premises during the
exercise of such rights, including removal of the Revolver Agent, any Revolver
Lender, and their respective officers, employees, and agents from both of the
Premises, the return of any information, documents or data made available
pursuant to Section
4 and Section
5(b), and the completion of all restoration activities and payment of
costs as set forth in Section 4(c)(v) and
(vi). Nothing
in this Section
6(b), including Revolver Agent’s performance of the Termination
Activities and the delivery of the Successor Indemnity, shall be deemed to toll
the running of or otherwise extend the Disposition Period. In
addition, nothing in this Section 6 shall be
deemed to limit the rights or remedies of either Agent arising from a breach by
any party of its obligations under this Agreement.
Section
7. NO
IMPAIRMENT.
(a) Nothing
herein is intended to limit or otherwise impair any right which the Revolver
Agent might otherwise have with respect to the Revolver Collateral, this
Agreement being intended to provide to the Revolver Agent rights in addition
thereto. Nothing herein is intended to limit or otherwise impair the
Term Agent's rights in the Term Collateral or to commence and prosecute an
action or proceeding to enforce its security interests in and liens on the Term
Collateral or with respect to or against any Obligor. Except as
expressly set forth in this Inter-Lender Agreement, the Revolver Agent does not
have any obligation to pay the Term Agent any amounts due under the Term Loan
Agreement or with respect to a Premises or otherwise.
(b) The
Revolver Agent acknowledges and agrees that it has no lien or security interest
on or in the Term Collateral. The Term Agent acknowledges and agrees
that it has no lien or security interest on or in the Revolver
Collateral.
Section
8. Amendments to Loan
Documents. The Revolver Agent and the Revolver Lenders may
enter into renewals and extensions of, amendments to, and waivers under, the
Revolver Loan Documents to which they are parties without the consent
of the Term Agent or the Term Lenders, and the Term Agent and the Term Lenders
may enter into renewals and
9
extensions
of, amendments to, and waivers under, the Term Loan Documents to which they are
parties without the consent of the Revolver Agent or the Revolver
Lenders. Nothing in this Section 8 shall
affect any covenants of any Obligor under the Revolver Loan Documents or the
Term Loan Documents that restricts such Obligor’s ability to amend, renew, or
extend any Revolver Loan Document or Term Loan Document.
Section
9. Relationship Between
Parties. Nothing in this Inter-Lender Agreement may be
construed to create a partnership or joint venture between any of the parties to
this Inter-Lender Agreement. No party to this Inter-Lender Agreement
has any implied duty under this Inter-Lender Agreement to any other
party.
Section
10. Notices. Any
notice or other communication required or permitted pursuant to this
Inter-Lender Agreement shall be deemed given: (a) when personally
delivered to any officer of the party to whom it is addressed; (b) on the
earlier of actual receipt thereof or three (3) days following posting thereof by
certified or registered mail, postage prepaid; (c) upon actual receipt thereof
when sent by a recognized overnight delivery service; or (d) upon actual receipt
thereof when sent by telecopier to the number set forth below with telephone
communication confirming receipt and subsequently confirmed by registered or
certified mail, postage prepaid, or overnight delivery to the address set forth
below, in each case addressed to each party at its address set forth below or at
such other address as has been furnished in writing by a party to the other by
like notice:
If to the
Revolver
Agent: Xxxxx
Fargo Foothill, Inc.
0000
Xxxxxxxx Xxxxxx
Xxxxx
0000 Xxxx
Xxxxx
Xxxxxx, Xxxxxxxxxx 00000
Attn:
Business Finance Division Manager
Fax
No. (000) 000-0000
If to the
Term Agent: Banc of
America Leasing & Capital LLC, as Collateral Agent
Mail
Code: GA3-003-04-01
Northeast
Center Building
0000
Xxxxxxxxx Xxxx
Xxxxxx,
XX 00000-0000
Attn:
Xxxxxxx X. XxXxxxxx, Vice President - Operations Manager
Tel No.
(000) 000-0000
Fax No.
(000) 000-0000
Section
11. Resignation of or Removal as
Agent.
(a) In
the event that the Revolver Agent resigns or is removed as “Agent” pursuant to
the Revolving Loan Agreement, the successor agent appointed pursuant to the
Revolving Loan Agreement shall, upon the effectiveness of such appointment, be
constituted as the Revolver Agent hereunder and the agent for the Revolver
Lenders under the Revolver Loan Documents. No such Successor Agent
shall be entitled to exercise any rights under Section 4 or Section 5(b) until
such time as it shall deliver to Term Agent an indemnity consistent with Section 6(a) and
insurance coverage, reasonably satisfactory to Term Agent.
10
(b) In
the event that the Term Agent resigns or is removed as “Agent” pursuant to the
Term Credit Agreement, the successor agent appointed pursuant to the Term Credit
Agreement to be Collateral Agent shall, upon the effectiveness of such
appointment, be constituted as the Term Agent hereunder and the agent for the
Term Lenders under the Term Security Agreements.
Section
12. Miscellaneous.
(a) The
rights and obligations contained herein (i) shall bind and inure to the benefit
of the parties hereto and their successors, assignees, nominees and designees,
[including, without limitation, any receiver appointed at the request of the
Term Agent] and (ii) may not be assigned by Revolver Agent except to a successor
Revolver Agent as provided herein.
(b) The
rights of each Agent or any Lender to enforce the provisions of this
Inter-Lender Agreement shall not be prejudiced or impaired by any act or
omission of any Obligor or the other Agent or other Lenders, including
forbearance, waiver, consent, compromise, amendment, extension, renewal, or
taking or release of security in respect of any Revolver Obligations or Term
Obligations, as the case may be, or noncompliance by any Obligator with such
provisions, regardless of the actual or imputed knowledge of either Agent or any
Lender.
(c) This
Inter-Lender Agreement shall continue in full force and effect after the filing
of any petition by or against any Obligator under the United States Bankruptcy
Code and all converted or succeeding cases in respect thereof. All
references herein to an Obligator shall be deemed to apply to any Obligator as
debtor-in possession and to any trustee for such Obligator.
(d) The
headings in this Inter-Lender Agreement are for convenience of reference only,
and shall not alter or otherwise affect the meaning hereof.
(e) No
amendment, modification, or waiver of any of the provisions of this Inter-Lender
Agreement by any Agent or Lender shall be deemed to be made unless the same
shall be in writing and signed on behalf of the party making the same or its
authorized agent, and each waiver, if any, shall be a waiver only with respect
to the specific instance involved and shall in no way impair the rights of the
parties making such waiver or the obligations of the other parties under this
Inter-Lender Agreement in any other respect or at any other time. No
Obligor shall have any right to consent to or approve any consent or waiver of
any provisions of this Inter-Lender Agreement given by the Term Agent or the
Term Lenders to the Revolver Agent or the Revolver Lenders, nor to any consent
or waiver given by the Revolver Agent or the Revolver Lenders to the Term Agent
or the Term Lenders. No Obligator shall have any right to consent to
or approve any amendment or modification of any provision of this Inter-Lender
Agreement except to the extent such amendment expressly purports to impose
specific additional obligations on it.
(f) Each
Agent, on behalf of itself and the applicable Lenders, agrees that each of them
shall take such further action and shall execute and deliver to each other such
11
additional
documents and instruments (in recordable form, if requested) as the other may
reasonably request, and as the cost of Obligors or, to the extent Obligors fail
to pay promptly following demand therefore, the Requesting Agent, to effectuate
the terms of and the lien priorities contemplated by this Inter-Lender
Agreement.
(g) Each
Agent represents and warrants to the other Agent that it has full right, power,
and authority to enter into and perform this Inter-Lender
Agreement. In no event shall Term Agent, either in its capacity as
agent or in its individual capacity, or any Term Lender, including their
respective officers, directors, employees or shareholders, have any liability
hereunder for, and Revolver Agent and Revolver Lenders shall not have any claim
against the assets of Term Agent, Term Lender or other such person, or the Term
Collateral for, any breach or omission under this Inter-Lender Agreement and
Revolver Agent’s and Revolver Lenders’ sole remedy hereunder shall be specific
performance of the duties and obligations set forth in this Inter-Lender
Agreement.
(h) If any
person or entity hereafter becomes an Obligor, the other Obligors shall cause
such Obligor to deliver a joinder agreement or other agreement with respect to
this Inter-Lender Agreement, in form and substance reasonably satisfactory to
each of the Term Agent and the Revolver Agent pursuant to which such person or
entity shall acknowledge, accept and agree to the terms of this Inter-Lender
Agreement.
(i) EACH
PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING
DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER
LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED
ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO
(A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON
HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN
THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND
(B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO
ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS,
THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
(j) EACH
PARTY HERETO IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS
PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW
YORK SITTING IN NEW YORK COUNTY AND OF THE UNITED STATES DISTRICT COURT OF THE
SOUTHERN DISTRICT OF NEW YORK, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY
ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS INTER-LENDER AGREEMENT
OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES
HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY
SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE
COURT OR, TO THE FULLEST EXTENT
12
PERMITTED
BY APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO
AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE
CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR
IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS INTER-LENDER
AGREEMENT SHALL AFFECT ANY RIGHT THAT ANY AGENT OR ANY LENDER MAY OTHERWISE HAVE
TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS INTER-LENDER AGREEMENT OR ANY
OTHER LOAN DOCUMENTS AGAINST ANY OBLIGOR OR ITS PROPERTIES IN THE COURTS OF ANY
JURISDICTION.
(k) EACH
BORROWER AND EACH OTHER LOAN PARTY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO
THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF
OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY COURT REFERRED
TO IN PARAGRAPH (j) OF THIS SECTION. EACH OF THE PARTIES HERETO
HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW,
THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT.
(l) EACH
PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED
FOR NOTICES IN SECTION 10. NOTHING IN THIS AGREEMENT WILL AFFECT THE
RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY
APPLICABLE LAW
(m) This
Agreement may be executed in any number of counterparts, and by each party in
separate counterparts, each of which shall be an original, but all of which
shall together constitute one and the same agreement.
(n) THIS
AGREEMENT SHALL BE DEEMED TO BE CONSUMMATED IN THE STATE OF NEW YORK AND SHALL
BE GOVERNED BY AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK.
(o) If any
provision of this Inter-Lender Agreement is held to be illegal, invalid or
unenforceable, (a) the legality, validity and enforceability of the remaining
provisions of this Agreement and the other Loan Documents shall not be affected
or impaired thereby and (b) the parties shall endeavor in good faith
negotiations to replace the illegal, invalid or unenforceable provisions with
valid provisions the economic effect of which comes as close as possible to that
of the illegal, invalid or unenforceable provisions. The invalidity
of a provision in a particular jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
[REMAINDER
OF THIS PAGE INTENTIONALLY LEFT BLANK]
13
Each of
the parties hereto has caused a counterpart of this Inter-Lender Agreement to be
duly executed and delivered as of the date first written above.
XXXXX
FARGO FOOTHILL, INC.
By: ___________________________
Name: _________________________
Title: __________________________
BANK OF
AMERICA LEASING & CAPITAL, LLC, as Term Agent
By: ____________________________
Name: __________________________
Title: __________________________
Acknowledged,
accepted and agreed as of the date first written above.
CHEROKEE NITROGEN HOLDINGS,
INC.,
an
Oklahoma corporation
By: ________________________
Title:
NORTHWEST FINANCIAL
CORPORATION,
an
Oklahoma corporation
By: _________________________
Title:
CHEROKEE NITROGEN
COMPANY,
an
Oklahoma corporation
By: ________________________
Title:
DSN CORPORATION,
an
Oklahoma corporation
By: __________________________
Title:
EL DORADO CHEMICAL
COMPANY,
an
Oklahoma corporation
By: __________________________
Title:
THERMACLIME,
INC.,
an
Oklahoma corporation
By: ___________________________
Title:
CHEROKEE
NITROGEN COMPANY,
an
Oklahoma corporation
By: ___________________________
Title:
CLIMATE
MASTER, INC.,
a
Delaware corporation
By: ___________________________
Title:
CLIMATECRAFT,
INC.,
an
Oklahoma corporation
By: ___________________________
Title:
CLIMACOOL,
CORP.,
an
Oklahoma corporation
By: ___________________________
Title:
INTERNATIONAL ENVIRONMENTAL
CORPORATION,
an
Oklahoma corporation
By: ___________________________
Title:
THERMACLIME
TECHNOLOGIES, INC.,
an
Oklahoma corporation
By: ___________________________
Title:
KOAX CORP., an Oklahoma
corporation
By: ___________________________
Title:
LSB
CHEMICAL CORP.,
an
Oklahoma corporation
By: ___________________________
Title:
XPEDIAIR, INC., an Oklahoma
corporation.
By: ___________________________
Title:
EL
DORADO CHEMICAL COMPANY,
an
Oklahoma corporation
By: ___________________________
Title:
CHEMEX I CORP., an Oklahoma
corporation
By: ___________________________
Title:
TRISON
CONSTRUCTION, INC.,
an
Oklahoma corporation
By: ___________________________
Title:
CHEMEX
II CORP.,
an
Oklahoma corporation
By: ___________________________
Title:
EXHIBIT
A-1
Address
of Alabama (Cherokee) Site
0000
Xxxxxxxxxx Xxxxx, Xxxxxxxx, XX 00000
Exhibit
A-1
EXHIBIT
X-0
Xxxxxxx
xx Xx Xxxxxx (Xxxxxxxx) Site
0000
Xxxxx Xxxx Xxxxxx, Xx Xxxxxx, Xxxxxxxx 00000-0000
Exhibit
X-0
XXXXXXX
X-0
Legal
Property Description of Alabama (Cherokee) Site
The tract
or lot of land lying in the County of Colbert, State of Alabama, known and
described as follows, to wit:
PARCEL
I:
Begin at
the Northwest corner of Section 0, Xxxxxxxx 0 Xxxxx, Xxxxx 00 Xxxx, Xxxxxxx
Xxxxxx, Xxxxxxx, and run thence South 0 degrees 36 minutes 44 seconds West
2621.36 feet with the westerly boundary line of said Section 7 to a point on
said boundary line; thence run North 88 degrees 55 minutes 46 seconds West
990.00 feet to a point; thence run South 0 degrees 35 minutes 43 seconds West
2623.55 feet parallel with the westerly boundary line of said Section 7, to a
point on the northerly boundary line of Xxxxxxx 00, Xxxxxxxx 0 Xxxxx, Xxxxx 00
Xxxx; thence run South 0 degrees 46 minutes 39 seconds West a distance of
5329.16 feet to a point on the southerly boundary of Xxxxxxx 00, Xxxxxxxx 0
Xxxxx, Xxxxx 00 Xxxx; thence run South 87 degrees 49 minutes 42 seconds East
1000.47 feet to the Southwest corner of Xxxxxxx 00, Xxxxxxxx 0 Xxxxx, Xxxxx 00
Xxxx; thence run South 89 degrees 14 minutes 26 seconds East 1397.26 feet to the
Southwest corner of the Southeast quarter of the Southeast quarter of said
Section 18, which section is a fractional section; thence run North 0 degrees 21
minutes 39 seconds East a distance of 46.5 feet to a concrete monument on the
north right-of-way margin of Xxxx Academy Road; thence south 89 degrees 08
minutes 27 seconds east along said north right-of-way margin a distance of
1,281.76 feet to a concrete monument; thence south 88 degrees 50 minutes 29
seconds east a distance of 2,191.21 feet; thence south 89 degrees 04 minutes 39
seconds east a distance of 474.74 feet; thence north 12 degrees 06 minutes 31
seconds east a distance of 784.37 feet; thence north 12 degrees 02 minutes 41
seconds east a distance of 51.11 feet; thence south 89 degrees 59 minutes 07
seconds west a distance of 726.65 feet; thence north 00 degrees 00 minutes 42
seconds east a distance of 414.62 feet; thence north 84 degrees 05 minutes 23
seconds east a distance of 780.35 feet; thence north 00 degrees 41 minutes 22
seconds east a distance of 816.26 feet to the south right-of-way margin of a 200
foot railroad right-of-way; thence north 88 degrees 03 minutes 37 seconds west
along said south right-of-way margin a distance of 1,193.19 feet; thence
westerly along the curving south right-of-way margin a distance of 347.85 feet
(said curve concave south, having a radius of 1,046.00 feet, a chord bearing of
south 82 degrees 24 minutes 48 seconds west, a chord length of 346.25 feet);
thence north 02 degrees 12 minutes 51 seconds west a distance of 205.80 feet to
the north right-of-way margin of a 200 foot railroad right-of-way; thence
easterly along the curving north right-of-way margin a distance of 361.43 feet
(said curve concave south, having a radius of 1,246.00 feet, a chord bearing
north 83 degrees 37 minutes 48 seconds east, a chord distance of 360.16 feet);
thence south 88 degrees 03 minutes 37 seconds east a distance of 1,188.82 feet;
thence north 00 degrees 41 minutes 22 seconds east a distance of 310.14 feet;
thence south 89 degrees 24 minutes 33 seconds east a distance of 240.77 feet to
U.S.-T.V.A. Monument No. 50 (being a concrete monument capped by a bronz tablet
showing said monument number and also "T.3S.R.13W.", and all other references to
U.S.-T.V.A. monuments herein shall refer to monuments of like character); thence
north 00 degrees 24 minutes 16 seconds east a distance of 420.42 feet to
U.S.-T.V.A. Monument No. 51; thence run north 33 degrees 37 minutes west
2,733.00 feet to U.S.-T.V.A. Monument No. 52 in the north line of Section 17,
which is in the
Exhibit
B-1
south
line of Section 8; thence north 37 degrees 38 minutes west 416.00 feet to
U.S.-T.V.A. Monument No. 53 at the northwest corner of the Southwest Quarter of
the Southwest Quarter of the Southeast Quarter of the Southwest Quarter of
Section 8; thence north 01 degree 35 minutes east 977.00 feet to U.S.-T.V.A.
Monument No. 54 at the northwest corner of the Southeast Quarter of the
Southwest Quarter of Section 8; thence north 35 degrees 59 minutes west 1,633.00
feet to U.S.-T.V.A. Monument No. 55 at the southeast corner of the Southwest
Quarter of the Southwest Quarter of the Southwest Quarter of the Northwest
Quarter of Section 8; thence north 88 degrees 50 minutes west 332.00 feet to
U.S.-T.V.A. Monument No. 56 at the southwest corner of the Northwest Quarter of
Section 8; thence with the south line of the Northeast Quarter of Section 7
north 88 degrees 50 minutes west 330.00 feet to U.S.-T.V.A. Monument No. 57;
thence leaving the said south line north 01 degree 23 minutes 15 seconds east
1,966.31 feet to U.S.-T.V.A. Monument No. 58; thence run north 88 degrees 35
minutes west 336.33 feet to U.S.-T.V.A. Monument No. 59; thence run south 68
degrees 55 minutes 24 seconds west 1,751.46 feet, more or less, to a point on
the south line of the north half of the north half of Section 7, Township 3
South, Range 13 West, which point is to be found by finding the intersection of
said south line of said north half of the north half of said Section 7 with a
line run south 00 degrees 39 minutes 12 seconds west a distance of 45 feet from
U.S.-T.V.A. Monument No. 60; thence run north 00 degrees 39 minutes 12 seconds
east 659.42 feet; thence run north 56 degrees 58 minutes 57 seconds east
1,150.50 feet, more or less, to U.S.-T.V.A. Monument No. 62 which is located in
the north boundary of said Section 7 at a point 1,399.63 feet easterly from the
northwest corner thereof; thence run north 88 degrees 39 minutes 30 seconds west
with said section line 1,399.63 feet to the POINT OF BEGINNING.
LESS AND
EXCEPT FROM THE FOLLOWING PARCELS: III, IV, V, VI, AND
VII:
Parcel
III:
Commencing
at the Southwest corner of Section 18, T-3-S, R-13-W, Colbert County, Alabama,
thence North 0 degrees 48 minutes East along the West line of said Section 18 a
distance of 4085.36 feet to a point; thence North 89 degrees 58 minutes East a
distance of 2003.88 feet to a concrete monument and the point of beginning of
the tract herein described; thence North 0 degrees 02 minutes West a distance of
450.00 feet to a point on a chain link fence; thence North 89 degrees 58 minutes
East with chain link fence a distance of 298.00 feet to a point; thence South 0
degrees 02 minutes East with chain link fence a distance of 116.50 feet to a
point; thence North 89 degrees 58 minutes East with chain link fence a distance
of 52.00 feet to a point; thence South 0 degrees 02 minutes East with chain link
fence a distance of 333.50 feet to a point; thence leaving said chain link fence
South 89 degrees 58 minutes West a distance of 2.00 feet to a concrete monument;
thence continuing South 89 degrees 58 minutes West a distance of 348.00 feet to
the concrete monument at the point of beginning of the tract herein
described.
Exhibit
B-2
Parcel
IV
Commence
at the Southwest corner of the said Section 0, Xxxxxxxx 0 Xxxxx, Xxxxx 00 Xxxx,
Xxxxxxx Xxxxxx, Xxxxxxx; thence North 0 degrees 36 minutes 44 seconds east along
the west line of the said Section 7 a distance of 2621.68 feet to the northwest
corner of the Southwest 1/4 of the said Section 7 and the point of beginning of
the tract herein described; thence continuing north 0 degrees 36 minutes 44
seconds east a distance of 200.00 feet to a point; thence south 89 degrees 23
minutes 16 seconds east a distance of 1500.00 feet to a point; thence south 0
degrees 36 minutes 44 seconds west a distance of 600.0 feet to a point; thence
north 89 degrees 23 minutes 16 seconds west a distance of 1500.0 feet to a point
on the west line of said Section 7; thence north 0 degrees 36 minutes 44 seconds
east a distance of 400.0 feet to the point of beginning of the tract herein
described.
Parcel
V
A parcel
of land located in Section 00, Xxxxxxxx 0-Xxxxx, Xxxxx 13-West in Colbert
County, State of Alabama, said parcel lying east of a right of way for a
proposed road approximately 3 miles north of Cherokee, and being more
particularly described as follows: Commencing at a point in the east
line of Section 18, said point being 1276.0 feet south of the northeast corner
of said section; thence xxx xxxx, 620.9 feet to the POINT OF BEGINNING at the
northeast corner of the parcel of land herein described; thence due south 600.0
feet to a point; thence xxx xxxx, 500.0 feet to a point; thence with a line
132.0 feet east of and parallel to the east line of the right of way of a
proposed road due north, 600.0 feet to a point; thence due east, 500.0 feet to
the point of beginning.
Parcel
VI
Also for
the point of beginning, commence at the intersection of the South line of North
half of North half of Section 0, Xxxxxxxx 0 Xxxxx, Xxxxx 00 Xxxx, Xxxxxxx
Xxxxxx, Xxxxxxx, with a line run South 0 degrees 39 minutes 12 seconds West from
U.S.-T.V.A. Monument No. 60; thence run North 0 degrees 39 minutes 12 seconds
East 659.42 feet to the point of beginning; from said point of beginning run
thence North 56 degrees 58 minutes 57 seconds E 1150.50 feet, more or less, to
U.S.-T.V.A. Monument No. 62, which is located in the North boundary of Section 7
at a point of 1399.63 feet easterly from the Northwest corner thereof; from said
Monument No. 62 run thence South 58 degrees 53 minutes 18 seconds West 1126.17
feet to U.S.-T.V.A. Monument No. 61; thence run South 0 degrees 39 minutes 12
seconds West to the point of beginning.
Parcel
VII:
Commence
at the southwest corner of Section 00, Xxxxxxxx 0 Xxxxx, Xxxxx 00 Xxxx, Xxxxxxx
Xxxxxx, Xxxxxxx; thence south 89 degrees 14 minutes 26 seconds east along the
South boundary of said Section 18 a distance of 1,397.26 feet; thence run North
00 degrees 21 minutes 39 seconds East a distance of 825.71 feet to the POINT OF
BEGINNING; continue thence North 00 degrees 21 minutes 39 seconds East a
distance of 505.52 feet; thence South 89 degrees 22 minutes 51 seconds East
B-3
a
distance of 1,116.70 feet; thence South 66 degrees 13 minutes 10 seconds West
along said southeasterly right of way margin a distance of 1,223.71 feet to the
POINT OF BEGINNING, containing 6.48 acres, more or less, and then being that
same parcel of land described in Deed Book 264, Page 560 as recorded in the
Probate Office of Colbert County, Alabama.
PARCEL
II:
A tract
of land lying in Colbert County, State of Alabama, in the East half of East half
of Northeast quarter, Section 7, the West half of Northwest quarter and
Southwest quarter of Section 8, and the Northeast quarter and East half of
Northwest quarter of Section 17, Township 3 South, Range 13 West on the
southwest shore of Pickwick Landing Lake opposite Kogor's Island and
approximately 4 miles northeast of Cherokee, Alabama, and being more
particularly described as follows:
Beginning
at U.S.-T.V.A. Monument 51 in the Southwest quarter of Southwest quarter of
Northeast quarter of Section 17 and in the boundary of true United States of
America's land at a corner of the land of Xxx. X.X. Xxxxxx and X.X. Xxxxxxxx
& X.X. Xxxxx' thence with the United States of America's boundary North 33
degrees 37' West 2733.00 feet to the U.S.-T.V.A. Monument 52 in the north line
of Section 17, which is the south line of Section 8; thence North 37 degrees 38'
West, 416.00 feet to U.S.-T.V.A. Monument 53 at the northwest corner of the
Southwest quarter of the Southwest quarter of the Southeast quarter of Southwest
quarter, Section 8; thence North 1 degree 35' East, 977.00 feet to U.S.-T.V.A.
Monument 54 at the northwest corner of the Southeast quarter of the SW 1/4
Section 8, thence North 35 degrees 59' West, 1633.00 feet to U.S.-T.V.A.
Monument 55 at the southeast corner of the Southwest quarter of the Southwest
quarter of Southwest quarter of Northwest quarter, Section 8; thence North 88
degrees 50' West, 332.00 feet to U.S.-T.V.A. Monument 56 at the southwest corner
of the Northwest quarter of Section 8; thence with the south line of the
Northeast quarter, Section 7 North 88 degrees 50' West, 330.00 feet to
U.S.-T.V.A. Monument 57; thence leaving the said South line, North 1 degree 23
minutes 15 seconds East, 1966.31 feet to U.S.-T.V.A. Monument 58; thence,
leaving the United States of America's boundary South 89 degrees 59 minutes 29
seconds East, 410 feet, passing a metal marker at 385.00 feet, to a point in the
423-foot contour on the shore of Pickwick Landing Lake; thence with the 423-foot
contour as it meanders in a southeasterly direction to a point; thence, leaving
the contour, South 61 degrees 19 minutes 05 seconds West, 534.50 feet, passing a
metal marker at 17 feet, to U.S.-T.V.A. Monument 49 in the south line of the
Northeast quarter of Section 17 and in the boundary of the United States of
America's land; thence with the United States of America's boundary and the
south line of the Northeast quarter of Section 17, North 89 degrees 19 minutes
West, 260.20 feet to U.S.-T.V.A. Monument 50; thence leaving the said south
line, North 0 degrees 24 minutes 16 seconds East, 420.42 feet to the point of
beginning.
PARCEL
III:
Commencing
at the Southwest corner of Section 18, T-3-S, R-13-W, Colbert County, Alabama,
thence North 0 degrees 48 minutes East along the West line of said Section 18 a
distance of 4085.36 feet to a point; thence North 89 degrees 58 minutes East a
distance of 2003.88 feet to a concrete monument and the point of beginning of
the tract herein described; thence North 0 degrees 02 minutes West a distance of
450.00 feet to a point on a chain link fence; thence North 89 degrees 58 minutes
East with chain link fence a distance of 298.00 feet to a point; thence South 0
degrees 02 minutes East with chain link fence a distance of 116.50 feet to a
point; thence North
B-4
89
degrees 58 minutes East with chain link fence a distance of 52.00 feet to a
point; thence South 0 degrees 02 minutes East with chain link fence a distance
of 333.50 feet to a point; thence leaving said chain link fence South 89 degrees
58 minutes West a distance of 2.0 feet to a concrete monument; thence continuing
South 89 degrees 58 minutes West a distance of 348.00 feet to the concrete
monument at the point of beginning at the tract herein described.
PARCEL
VIII:
A parcel
of land lying in Section 00, Xxxxxxxx 0 Xxxxx, Xxxxx 13 West, Colbert County,
Alabama, and being more particularly described as follows: Commence
at the southwest corner of Section 00, Xxxxxxxx 0 xxxxx, Xxxxx 00 Xxxx, Xxxxxxx
Xxxxxx, Xxxxxxx; thence north 00 degrees 44 minutes 27 seconds west a distance
of 44.05 feet to a concrete monument on the north right-of-way of Xxxx Academy
Road; thence south 88 degrees 50 minutes 29 seconds east along the north
right-of-way of an unnamed County road a distance of 2,191.21 feet; thence south
89 degrees 04 minutes 39 seconds east a distance of 535.94 feet to the east
right-of-way of a County road and the POINT OF BEGINNING; thence north 12
degrees 05 minutes 42 seconds east a distance of 761.78 feet; thence south 70
degrees 57 minutes 14 seconds east a distance of 233.95 feet to a Point of
Curve; thence southeasterly along a curve concave north a distance of 638.62
feet (said curve having a radius of 2,025.00 feet, a chord bearing of south 79
degrees 59 minutes 24 seconds east, a chord distance of 635.97 feet) to the
Point of Tangency; thence south 89 degrees 01 minute 08 seconds east a distance
of 517.34 feet to a Point of Curve; thence southeasterly along said curve
concave southwesterly a distance of 566.33 feet (said curve having a radius of
950.00 feet, a chord bearing of south 71 degrees 56 minutes 27 seconds east, a
chord distance of 557.98 feet) to a Point of Reverse Curve; thence southwesterly
along a curve a distance of 108.67 feet (said curve concave northeasterly having
a chord bearing of south 25 degrees 43 minutes 19 seconds east, a chord distance
of 88.51 feet) to a point; thence south 00 degrees 41 minutes 33' west a
distance of 360.35 feet; thence north 89 degrees 04 minutes 24 seconds west a
distance of 1,995.46 feet; thence north 00 degrees 46 minutes 28 seconds east a
distance of 30.00 feet; thence north 88 degrees 59 minutes 48 seconds west a
distance of 94.09 feet to the POINT OF BEGINNING.
PARCEL
IX:
A parcel
of land lying in Section 17, Township 3 South, Range 13 West and being more
particularly described as follows: Commence at the southwest corner
of Section 00, Xxxxxxxx 0 xxxxx, Xxxxx 00 Xxxx, Xxxxxxx Xxxxxx, Xxxxxxx; thence
north 00 degrees 44 minutes 27 seconds west a distance of 44.05 feet to a
concrete monument on the north right-of-way of Xxxx Academy Road; thence south
88 degrees 50 minutes 29 seconds east along the north right-of-way of an unnamed
County road a distance of 2,191.21 feet; thence south 89 degrees 04 minutes 39
seconds east a distance of 535.94 feet to the east right-of-way of a County
Road; thence north 12 degrees 05 minutes 42 seconds east along said east
right-of-way a distance of 812.15 feet to the POINT OF BEGINNING; thence north
12 degrees 05 minutes 22 seconds east along said right-of-way a distance of
204.63 feet; thence north 01 degree 53 minutes 39 seconds east along said
right-of-way a distance of 310.69 feet; thence south 89 degrees 07 minutes 03
seconds east a distance of 1,802.58 feet to T.V.A. Monument #48; thence south 42
degrees 56 minutes 26 seconds east a distance of 310.99 feet; thence south 56
degrees 00 minutes 16 seconds west a
B-5
distance
of 808.14 feet to a point of curve; thence northwesterly along a curve concave
southwesterly a distance of 43.45 feet (said curve having a radius of 1,000.00
feet, a chord bearing of N 87 deg 46 min 18 sec West a arc length of 43.45 feet)
to the point of tangency; thence north 89 degrees 01 minutes 16 seconds West a
distance 516.26 feet to the Point of a Curve; thence northwesterly along a curve
concave north a distance of 622.86 feet (said curve having a radius of 1,975
feet, a chord bearing of North 79 degrees 59 minutes 24 seconds West, a chord
distance of 620.28 feet) to the Point of Tangency; thence North 70 degrees 57
minutes 14 seconds West a distance of 240.04 feet to the POINT OF
BEGINNING.
All the
foregoing being the same property conveyed by XxXxxxx Industries, Inc. to
Cherokee Nitrogen Company, by deed dated October 31, 2000, filed for record in
the Office of the Judge of Probate of Colbert County, Alabama, on November 7,
2000, at 1:37 p.m., and recorded on Microfiche 2000 25, Frames
133-141.
Less and
except therefrom property conveyed by Cherokee Nitrogen, Inc., to National
Telephone Company of Alabama, by corrective warranty deed dated April 2, 2001
and recorded on Fiche 2001 09 Frame 748, being more particularly described as
follows, to-wit:
Commence
at a cotton spindle on the SW corner of Section 00, X-0-X, X-00-X, Xxxxxxx
Xxxxxx, Xxxxxxx; then run S 89 degrees 14’ 26” E for 1397.26’ to a spike found;
then run N 0 degrees 21’ 39” E for 46.4’ to a 6” concrete monument, the point of
beginning; then run N 0 degrees 21’ 39” E for 50.0’ to an iron pin; then run S
89 degrees 14’ 26” E for 50.0’ to an iron pin; then run S 0 degrees 21’ 39” W
for 50.0’ to an iron pin; then run N 89 degrees 14’ 26” W for 50.0’ to the point
of beginning.
Non-Exclusive
Easement for Private Road
A fifty
(50) foot wide private road lying in Section 00, Xxxxxxxx 0 Xxxxx, Xxxxx 13
West, Colbert County, Alabama, and being more particularly described as follows:
Commence at the southwest corner of Section 00, Xxxxxxxx 0 Xxxxx, Xxxxx 00
Xxxx, Xxxxxxx Xxxxxx, Xxxxxxx, thence North 00 degrees 44 minutes 27 seconds
West a distance of 44.05 feet to a concrete monument on the northern
right-of-way margin of Xxxx Academy road; thence South 88 degrees 50 minutes 29
seconds East along the northern right-of-way margin of a gravel road a distance
of 2,191.21 feet; thence South 89 degrees 04 minutes 39 seconds East a distance
of 535.74 feet to the east right-of-way margin of a County Road; thence North 12
degrees 05 minutes 42 seconds East a distance of 761.78 feet to the POINT OF
BEGINNING; thence continue North 12 degrees 05 minutes 42 seconds East a
distance of 50.37 feet; thence South 70 degrees 57 minutes 14 seconds East a
distance of 240.04 feet to the P.C. of a curve; thence southeasterly a curve
concave northerly a distance of 622.86 feet (said curve having a radius of
1,975.00 feet, a chord distance of 620.28 feet, a chord bearing of South 79
degrees 59 minutes 24 seconds East) to the P.T. of said curve; thence South 89
degrees 01 minute 16 seconds East a distance of 516.26 feet to the P.C. of a
curve; thence southeasterly along a curve concave southwesterly a distance of
648.77 feet (said curve having a radius of 1,000.00 feet, a chord distance of
637.45 feet, a chord bearing of South 70 degrees 26 minutes 42 seconds East) to
the P.T. of said curve and the P.C. of a cul-de-sac; thence easterly, southerly,
northwesterly along a curve (having a radius of 50.00 feet; a chord bearing of
South 82 degrees 09 minutes 16 seconds West, a chord distance of 70.63
B-6
feet) a
distance of 234.31 feet to the P.T. of said curve; thence northwesterly along a
curve concave southwest a distance of 566.33 feet (said curve having a radius of
950.00 feet, a chord bearing of North 71 degrees 56 minutes 27 seconds West, a
chord distance of 557.98 feet) to the P.T. of said curve; thence North 89
degrees 01 minute 08 seconds West a distance of 517.34 feet to the P.C. of a
curve; thence northwesterly along a curve concave northerly of 638.62 feet (said
curve having a radius of 2,025.00 feet, a chord distance of 635.97 feet, a chord
bearing of 79 degrees 59 minute 24 seconds west) to the P.T. of said curve,
thence North 70 degrees 57 minutes 14 seconds West) to the P.T. of said curve;
thence North 70 degrees 57 minutes 14 seconds West a distance of 233.95 feet to
the POINT OF BEGINNING.
B-7
EXHIBIT
B-2
Legal
Property Description of El Dorado (Arkansas) Site
The land
referred to herein below is all situated in Union County, Arkansas
Tract
1:
The South
Half of Section 6, and the North Half of Section 7, and the Northwest
Quarter of the Northwest Quarter of Section 8, all in Township 17
South, Range 15 West, and the following described tract:
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Beginning
at the Northwest Corner of the Northeast Quarter of the Northwest Quarter
of Section 8, Township 17 South, Range 15
West;
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thence
South along the West line of said Northeast Quarter of the Northwest
Quarter of Section 8 to the intersection with the South
right-of-way line of the access road as now located, said right-of-way
line being 50 feet perpendicular distance from the center line of
said access road;
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thence
in a Northeasterly direction along said right-of-way line to the
intersection with the South line of the right-of-way of the railroad
spur, said right-of-way line for the railroad spur being 50 feet
perpendicular distance from the center line of said railroad
spur;
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thence
along said South right-of-way line for the railroad spur to a point which
is 750 feet South of the North line of said
Section 8;
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thence
East along a line which is parallel to the North line of said
Section 8, and 750 feet distant therefrom to the
intersection with the South right-of-way line for the railroad spur
herein above described;
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thence
in a Southeasterly direction along the said South right-of-way line to the
intersection with the West right-of-way line of the
El Dorado-Smackover Highway;
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thence
in a Northwesterly direction along the West right-of-way line of said
El Dorado-Smackover Highway to the North line of Section 0,
Xxxxxxxx 00 Xxxxx,
Xxxxx 00Xxxx;
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thence
West along the North line of said Section 9 and the North line of
said Section 8 to the POINT OF
BEGINNING.
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LESS
AND EXCEPT THE FOLLOWING TRACTS:
1. Commencing
at the Southeast Xxxxxx xx Xxxxxxx 0, Xxxxxxxx 00 Xxxxx, Xxxxx 15
West, and thence run North 88 degrees 53 minutes 44 seconds West
1772.43 feet;
thence
North 01 degree 03 minutes 47 seconds East 576.89 feet for a
POINT OF BEGINNING;
thence
North 88 degrees 56 minutes 13 seconds West
134.0 feet;
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thence
North 01 degree 03 minutes 47 seconds East
40.00 feet;
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thence
North 88 degrees 56 minutes 13 seconds West
16.00 feet;
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thence
North 01 degree 03 minutes 47 seconds East
40.0 feet;
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thence
South 88 degrees 56 minutes 13 seconds East
150.00 feet;
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thence
South 01 degree 03 minutes 47 seconds West 80.00 feet
to the POINT OF BEGINNING.
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AND
B-8
2. Commencing
at the Southeast Xxxxxx xx Xxxxxxx 0, Xxxxxxxx 00 Xxxxx, Xxxxx 15
West, run thence North 88 degrees 53 minutes 44 seconds West
2341.68 feet;
thence
North 01 degree 05 minutes 46 seconds East 545.52 feet for a POINT OF
BEGINNING;
thence
North 88 degrees 54 minutes 14 seconds West
240.00 feet;
thence
North 01 degree 05 minutes 46 seconds East
30.00 feet;
thence
North 88 degrees 54 minutes 14 seconds West
96.71 feet;
thence
North 01 degree 05 minutes 46 seconds East
118.10 feet;
thence
South 88 degrees 54 minutes 14 seconds East
336.71 feet;
thence
South 01 degree 05 minutes 46 seconds West
85.72 feet;
thence
South 88 degrees 54 minutes 14 seconds East
59.31 feet;
thence
South 01 degree 05 minutes 46 seconds West
40.58 feet;
thence
North 88 degrees 54 minutes 14 seconds West
59.31 feet;
thence
South 01 degree 05 minutes 46 seconds West 21.80 feet to the
POINT OF BEGINNING.
Tract
2:
Commencing
at the North Quarter Corner of Section 1, Township 17 South,
Range 16 West, thence South 88 degrees 46 minutes
East, 282.7 feet;
thence
South 01 degree 14 minutes West, 269.2 feet to the POINT OF
BEGINNING;
thence
South 88 degrees 46 minutes East, 150.0 feet;
thence
South 01 degree 14 minutes West, 150.0 feet;
thence
North 88 degrees 46 minutes West, 150.0 feet;
thence
North 01 degree 14 minutes East, 150.0 feet to the POINT OF
BEGINNING.
Tract
3:
Beginning
at the Southwest Corner of the Northeast Quarter of Section 31,
Township 16South, Range 15 West;
thence
North 00 degrees 07 minutes East 150 feet to a
stake;
thence
South 88 degrees 37 minutes East 150 feet to a
stake;
thence
South 00 degrees 07 minutes West 150 feet to a stake on South
line of the Northeast Quarter;
thence
North 88 degrees 37 minutes West 150 feet to POINT OF
BEGINNING.
Tract
4:
Beginning
at the Southeast Corner of the Southwest Quarter of Section 30,
Township 16 South, Range 15 West, at a iron pipe
Corner;
thence
North 88 degrees 38 minutes West 150 feet along the South line of
said Section 30 to a stake;
thence
North 00 degrees 07 minutes East 150 feet to a
stake;
thence
South 88 degrees 38 minutes East to a stake on the East line of said
Southwest Quarter;
thence
South 00 degrees 07 minutes West 150 feet to POINT OF
BEGINNING.
B-9
Tract
5:
Commencing
at the Northwest Corner of the South Half of the Northeast Quarter of
Section 12, Township 17 South, Range 16 West;
thence
South 00 degrees 04 minutes East, 469.0 feet;
thence
North 53 degrees 09 minutes East, 126.45 feet;
thence
North 61 degrees 26 minutes East, 239.7 feet to the POINT OF
BEGINNING;
thence
North 00 degrees 04 minutes West, 118.7 feet;
thence
North 89 degrees 56 minutes East, 150.0 feet;
thence
South 00 degrees 04 minutes East, 150.0 feet;
thence
South 89 degrees 56 minutes West, 150.0 feet;
thence
North 00 degrees 04 minutes West, 31.3 feet to the POINT OF
BEGINNING.
Tract
6:
Beginning
at a point which is South 00 degrees 18 minutes East 223.2 feet
and North 89 degrees 42 minutes East 273.1 feet distance from the
Northwest Corner of the Southwest Quarter of Section 9, Township 17
South, Range 15 West;
thence
North 00 degrees 18 minutes West 150 feet;
thence
North 89 degrees 42 minutes East 150 feet;
thence
South 00 degrees 18 minutes East 150 feet;
thence
South 89 degrees 42 minutes West 150 feet to the POINT OF
BEGINNING.
Tract
7:
Beginning
at the Southwest Corner of the Southeast Quarter of Xxxxxxx 0,
Xxxxxxxx 00 Xxxxx, Xxxxx 00 Xxxx;
thence
North 150 feet along the West line of said Southeast Quarter to a
stake;
thence
South 88 degrees 56 minutes East 150 feet to a
stake;
thence
South 150 feet to a stake on South line of said
Section 2;
thence
North 88 degrees 56 minutes West 150 feet to POINT OF
BEGINNING.
Tract
8:
Beginning
at the Xxxxxxxxx Xxxxxx, Xxxxxxx 0, Xxxxxxxx 00 Xxxxx, Xxxxx 16
West;
thence
North along Section line 150 feet to a stake;
thence
South 88 degrees 56 minutes East 150 feet to a
stake;
thence
South 150 feet to a stake;
thence
North 88 degrees 56 minutes West 150 feet to POINT OF
BEGINNING.
Tract
9:
Commencing
at the Southwest Corner of the Southeast Quarter of Section 12,
Township 17 South, Range 16 West;
thence
North 00 degrees 04 minutes West, 276.7 feet;
thence
North 89 degrees 56 minutes East, 271.8 feet to the POINT OF
BEGINNING;
thence
North 00 degrees 04 minutes West, 150 feet;
thence
North 89 degrees 56 minutes East, 150 feet;
thence
South 00 degrees 04 minutes East, 150 feet;
thence
South 89 degrees 56 minutes West, 150 feet to the POINT OF
BEGINNING.
B-10
Tract
10:
Commencing
at the Southwest Corner of Southeast Quarter of Xxxxxxx 0, Xxxxxxxx 00
Xxxxx, Xxxxx 00 Xxxx;
thence
South 88 degrees 25 minutes East 155.4 feet;
thence
North 01 degree 35 minutes East 308.5 feet to the POINT OF
BEGINNING;
thence
continuing North 01 degree 35 minutes East 150 feet;
thence
South 88 degrees 25 minutes East 150 feet;
thence
South 01 degree 35 minutes West 150 feet;
thence
North 88 degrees 25 minutes West 150 feet to the POINT OF
BEGINNING.
Tract
11:
Beginning
at the Northwest Corner of the Southeast Quarter, Section 18,
Township 17 South, Range 15 West;
thence
South 88 degrees 21 minutes East 150 feet along the North line of
the said Southeast Quarter to a stake;
thence
South 00 degrees 11 minutes East 150 feet to a
stake;
thence
North 88 degrees 21 minutes West 150 feet to a stake on the West
line of the said Southeast Quarter;
thence
North 00 degrees 11 minutes West 150 feet to the POINT OF
BEGINNING.
Tract
12:
Beginning
at a point on the West line of the Southeast Quarter of Section 18,
Township 17 South, Range 15 West, located North 00 degrees
11 minutes West 150 feet from the Southwest Corner of said Southeast
Quarter;
thence
North 00 degrees 11 minutes West 100 feet along the West line of
said Southeast Quarter to a stake;
thence
South 88 degrees 17 minutes East 150 feet to a
stake;
thence
South 00 degrees 11 minutes East 100 feet to a
stake;
thence
North 88 degrees 17 minutes West 150 feet to the POINT OF
BEGINNING.
Tract
15:
Beginning
at the Southeast Corner of Section 1, Township 17 South, Range 16
West;
thence
North 89 degrees 25 minutes West along the South line of said
Section 1, 4830.14 feet to POINT OF BEGINNING;
thence
North 00 degrees 04 minutes East 150 feet;
thence
North 89 degrees 25 minutes West 150 feet;
thence
South 00 degrees 04 minutes West 150 feet to the
intersection of South line of Section 1;
thence
South 89 degrees 25 minutes East along Section line 150 feet
to POINT OF BEGINNING.
B-11
Tract
16:
Beginning
at a point 10.4 feet North of the Xxxxxxxxx Xxxxxx xx Xxxxxxx 0,
Xxxxxxxx 00Xxxxx, Xxxxx 15 West;
thence
East 29.5 feet;
thence
North 150.0 feet;
thence
West 29.5 feet;
thence
South 150.0 feet to the POINT OF BEGINNING.
Tract
17:
Beginning
at a point 70 yards North of the Southeast Corner of Section 1,
Township 17 South, Range 16 West;
thence
West 25.00 feet;
thence
South approximately 134.83 feet;
thence
East 25.00 feet;
thence
North to the PLACE OF BEGINNING.
The
exclusive right to produce water from any horizon lying under the following
described Tract 18 in Union County, Arkansas, at and below a depth of
350 feet below the surface:
Tract
18:
The East
Half of Section 1 and the East Half of Section 12, all in
Township 17 South, Range 16 West,
And
The South
Half of Section 7 and all of Section 8, all in Township 17 South,
Range 15 West,
And
All that
part of the West Half of the West Half of Section 9, Township 17
South, Range 15 West, lying West of the El Dorado-Smackover Highway
and all that part of the Southwest Quarter of the Southwest Quarter of
Section 4, Township 17 South, Range 15 West, lying West of the
El Dorado-Smackover Highway and all of Section 5 and the North Half of
Section 6, all in Township 17 South, Range 15 West, EXCEPT the following described
tracts, lettered (a) through (k), both inclusive, to-wit:
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(a)
The Northwest Quarter of the Northwest Quarter of Xxxxxxx 0,
Xxxxxxxx 00 Xxxxx, Xxxxx 00
Xxxx.
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(x)
Beginning at the Northwest Corner of the Northeast Quarter of the
Northwest Quarter of Section 8, Township 17 South, Range 15
West;
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thence
South along the West line of said Northeast Quarter of the Northwest
Quarter of said Section 8 to the intersection with the South
right-of-way line of the Access Road as now
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B-12
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located said right-of-way line being 50 feet perpendicular distance
from the center line of said Access Road;
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thence
in a Northeasterly direction along said right-of-way line to the
intersection with the South line of the right-of-way of the railroad
spur, said right-of-way line for the railroad spur being 50 feet
perpendicular distance from the center line of said railroad
spur;
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thence
along said South right-of-way line for the railroad spur to a point which
is 750 feet South of the North line of said
Section 8;
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thence
East along a line which is parallel to the North line of said
Section 8, and 750 feet distant therefrom, to the
intersection with the South right-of-way line for the railroad spur
hereinabove described;
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thence
in a Southeasterly direction along the said South right-of-way line to the
intersection with the West right-of-way line of the
El Dorado-Smackover Highway;
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thence
in a Northwesterly direction along the West right-of-way line of said
El Dorado-Smackover Highway to the North line of Xxxxxxx 0,
Xxxxxxxx 00 Xxxxx, Xxxxx 00
Xxxx;
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thence
West along the North line of said Section 9 and the North line of
said Section 8 to the POINT OF
BEGINNING.
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(c) Commencing
at the Northwest Corner of Section 5, Township 17 South,
Range 15 West;
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thence
South 88 degrees 24 minutes East 4060.30 feet to the POINT
OF BEGINNING of this excepted
tract;
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thence
South 00 degrees 40 minutes West
1213.20 feet;
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thence
South 88 degrees 10 minutes East 1200.33 feet to the
El Dorado-Smackover Highway;
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thence
in a Northwesterly direction along said Highway to the North line of said
Section 5;
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thence
in a Westerly direction to the POINT OF
BEGINNING.
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(d) Commencing
at the Northeast Corner of Section 6, Township 17 South,
Range 15 West;
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thence
North 88 degrees 23 minutes West 1327 feet to the POINT OF
BEGINNING of this excepted tract;
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thence
South 01 degree 37 minutes West
90 feet;
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thence
North 88 degrees 23 minutes West
990 feet;
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thence
North 01 degree 37 minutes East
90 feet;
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thence
South 88 degrees 23 minutes East 990 feet to the POINT OF
BEGINNING.
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(e) Tract
2 described above.
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(f) Tract
5 described above.
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(g) Tract
6 described above.
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(h) Tract
9 described above.
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(i) Tract
10 described above.
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(j) Tract
16 described above.
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(k) Tract
17 described above.
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TOGETHER WITH all of the
rights of the United States of America as granted to Lion Oil Company in an
instrument entitled “Quitclaim Deed, Assignment and Xxxx of Sale” which was
B-13
filed
March 5, 1948 in Record Book 511, Page 405 to maintain, repair,
replace and operate each electrical transmission line, telephone line, water
line gas line, sanitary sewer, drainage sewer, drainage ditch, road, trail or
railroad upon any of the land which constitutes a part of Tract 18 described
above or which leads from Tract 18 described above to Tracts 3, 4, 7, 8, 11, 12
and 15 described above, and the right-of-way in connection therewith, all as is
more fully set forth in said Quitclaim Deed, Assignment and Xxxx of
Sale.
TOGETHER WITH such water
rights as were reserved by Monsanto Company in a Quitclaim Deed in favor of
X. X. Xxx which was filed February 23, 1981 in Record Book 1459,
Page 601, of the Union County Deed Records describing the following
tract:
Beginning
at the Southwest Corner of the Southwest Quarter of the Southeast Quarter of
Section 8, Township 17 South, Range 15 West;
thence
North 417.4 feet;
thence
East 417.4 feet;
thence
South 417.4 feet;
thence
West 417.4 feet to the POINT OF BEGINNING.
ALSO
Commencing
at the Southeast Corner of the Southeast Quarter of the Southwest Quarter of
Section 8, Township 17 South, Range 15 West;
thence
North 01 degree 06 minutes East 274.0 feet to the POINT OF
BEGINNING;
thence
North 88 degrees 54 minutes West 69.8 feet;
thence
North 01 degree 06 minutes East 150.0 feet;
thence
South 88 degrees 54 minutes East 69.8 feet;
thence
South 01 degree 06 minutes West 150.0 feet to the POINT OF
BEGINNING.
TOGETHER WITH such water
rights as were reserved in a Quitclaim Deed in favor of Xxxxx Xxxx White et al
which was filed September 10, 1982 in Record Book 1521, Page 257, in
the Union County Deed Records describing the following tract:
Beginning
at the Southwest Corner of the Southwest Quarter of the Northwest Quarter of
Section 9, Township 17 South, Range 15 West;
and run
North 00 degrees 38 minutes East 1729.4 feet to the South
right-of-way line of the Missouri-Pacific Railroad;
thence in
a Southeasterly direction along said right-of-way for 547.8 feet to the
Xxxx xxxx xx Xxxxxxx Xx. 0X;
thence
South 08 degrees 29 minutes East along said line
21.8 feet;
thence
South 05 degrees 24 minutes East along said line
1444.0 feet;
thence
South 02 degrees 50 minutes East along said line
96.57 feet;
thence
North 88 degrees 14 minutes West 675.4 feet to the POINT OF
BEGINNING.
B-14
Tract
41-1 (25):
The West
Half of the Southeast Quarter of the Southeast Quarter and the Northeast Quarter
of the Southeast Quarter of Section 7, and the Southwest Quarter of the
Northwest Quarter of Section 8, all in Township 17 South,
Range 15 West, Union County, Arkansas, EXCEPTING THE FOLLOWING DESCRIBED
TRACT:
Beginning
at a point 600.0 feet North of the Northwest Corner of the Southwest
Quarter of said Section 8;
thence
North 435.6 feet;
thence
East 100.0 feet;
thence
South 435.6 feet;
thence
West 100.0 feet to the POINT OF BEGINNING.
Tract
41-2 (20):
The North
Three-Quarters of the North Half of the Northwest Quarter of the Southeast
Quarter (N 3/4 N/2 NW/4 SE/4) of Section 7, Township 17 South,
Range 15 West, LESS
three (3) acres in the form of a square in the Northeast Corner
thereof.
Tract
41-4 (22):
Three
acres in the form of a square out of the Northeast Corner of the Northwest
Quarter of the Southeast Quarter of Section 7, Township 17 South,
Range 15 West of the Fifth Principal Meridian.
(Same
Property as the exception in 41-2 (20) above)
Tract
41-4 (23):
Beginning
at a point 600 feet North of the Southwest Corner of the Southwest Quarter
of the Northwest Quarter of Section 8, Township 17 South,
Range 15 West of the Fifth Principal Meridian;
thence
East 100.0 feet;
thence
North 435.6 feet;
thence
West 100.0 feet;
thence
South 435.6 feet to the PLACE OF BEGINNING.
(Same
Property as the exception in 41-1 (25) above)
Tract
41-4 (24):
A part of
the Southwest Quarter of the Southeast Quarter of Section 8,
Township 17 South, Range 15 West of the Fifth Principal Meridian,
described as follows:
Beginning
at a point 417.4 feet North of the Southwest Corner of the said Southwest
Quarter of the Southeast Quarter of Section 8 and running thence North
208.71 feet;
thence
East 208.71 feet;
thence
South 208.71 feet;
thence
West 208.71 feet to the PLACE OF BEGINNING,
B-15
EXCEPT that part of the
Southwest Quarter of the Southeast Quarter of Section 8 contained within
the following parcel of land, described as:
Commencing
at the Southwest Corner of said Southwest Quarter of the Southeast Quarter of
said Section 8;
thence
South 88 degrees 54 minutes East, 80.2 feet;
thence
North 01 degree 06 minutes East, 274.0 feet to the POINT OF
BEGINNING of said parcel;
thence
North 88 degrees 54 minutes West, 150.0 feet;
thence
North 01 degree 06 minutes East, 150.0 feet;
thence
South 88 degrees 54 minutes East, 150.0 feet;
thence
South 01 degree 06 minutes West, 150.0 feet to the POINT OF
BEGINNING.
Tract
41-5 (19):
The South
Five-Eighths of the Northwest Quarter of the Southeast Quarter and the North
Three-Eighths of the Southwest Quarter of the Southeast Quarter of
Section 7, Township 17 South, Range 15 West of the Fifth
Principal Meridian.
Tract
41-7:
The
Southwest Quarter of the Northeast Quarter and the Southeast Quarter of the
Northwest Quarter of Section 0, Xxxxxxxx 00 Xxxxx, Xxxxx 00 Xxxx,
Xxxxx Xxxxxx, Xxxxxxxx.
Tract
41-9:
The
Northwest Quarter of the Southwest Quarter of Section 5, Township 17
South, Range 15 West,
AND
The East
Half of the Northeast Quarter of Section 6, Township 17 South,
Range 15 West.
Tract
41-10:
The
Northwest Quarter of the Northeast Quarter of Section 0, Xxxxxxxx 00
Xxxxx, Xxxxx 00 Xxxx, Xxxxx Xxxxxx, Xxxxxxxx, LESS AND EXCEPT the following
tract:
Commencing
at the Northeast Corner of the Northwest Quarter of the Northeast Quarter of
Section 6, Township 17 South, Range 15 West, and run thence South
90 feet;
thence
West 990 feet;
thence
North 90 feet;
thence
East 990 feet to the POINT OF BEGINNING.
Tract
41-11:
The
Southeast Quarter of the Northeast Quarter of Section 1, Township 17
South, Range 16 West,
ALSO
The
Southwest Quarter of the Northwest Quarter of Section 6, Township 17
South, Range 15 West,
LESS
AND EXCEPT THE FOLLOWING TRACTS:
B-16
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1.
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All
that part of the Southeast Quarter of the Northeast Quarter
(SE/4 NE/4) of Xxxxxxx 0, Xxxxxxxx 00 Xxxxx, Xxxxx 00
Xxxx, Xxxxx Xxxxxx, Xxxxxxxx, lying North and West of Arkansas State
Highway #335,
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2.
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All
that part of the Southwest Quarter of the Northwest Quarter
(SW/4 NW/4) of Xxxxxxx 0, Xxxxxxxx 00 Xxxxx, Xxxxx 00
Xxxx, Xxxxx Xxxxxx, Xxxxxxxx, lying North and Xxxx xx Xxxxxxxx Xxxxx
Xxxxxxx #000.
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Tract
41-12:
The East
Quarter of the Southwest Quarter of the Southeast Quarter of Section 1,
Township 17 South, Range 16 West
AND
the
Southeast Quarter of the Southeast Quarter of Section 1 Township 17
South, Range 16 West of the Fifth Principal Meridian, LESS THE FOLLOWING
TRACTS:
1. A
tract described as:
Commencing
70 yards North of the Southeast Corner of the Southeast Quarter of the Southeast
Quarter of Section 1, Township 17 South, Range 16 West, as a
BEGINNING POINT;
thence
South 70 yards;
thence
West 330 yards;
thence
North 61.5 yards;
thence in
a straight line to a POINT OF BEGINNING.
2. A
tract described as:
Beginning
at a point 70 yards North of the Southeast Corner of Section 1,
Township 17 South, Range 16 West;
thence
North 15.17 feet;
thence
West 25.00 feet;
thence
South 15.17 feet;
thence
East to the POINT OF BEGINNING.
3. A
tract described as:
Commencing
at the Southeast Corner (XXXxx) of Xxxxxxx 0, Xxxxxxxx 00 Xxxxx,
Xxxxx 00 Xxxx, Xxxxx Xxxxxx, Xxxxxxxx, and run North 89 degrees
24 minutes 22 seconds West along the South line of said Section 1
a distance of 1172.08 feet, more or less, to the center line of a county
road for the point of beginning;
thence
run North 33 degrees 28 minutes 58 seconds East
432.00 feet;
thence
North 89 degrees 21 minutes 48 seconds West
715.87 feet;
thence
South 00 degrees 16 minutes 35 seconds West 363.30 feet to
the South line of Section 1;
thence
South 89 degrees 24 minutes 22 seconds East 479.28 feet to
the point of beginning.
B-17
4. (Monsanto
to Xxxxxxx)
Commencing
at the Southeast Xxxxxx xx Xxxxxxx 0, Xxxxxxxx 00 Xxxxx, Xxxxx 16
West, and run North 89 degrees 25 minutes West
400.0 feet;
thence
North 00 degrees 15 minutes East 199.7 feet to the POINT OF
BEGINNING;
thence
North 00 degrees 15 minutes East 150.9 feet;
thence
North 89 degrees 25 minutes West 543.7 feet to the center of
State Highway No. 335;
thence
South 33 degrees 55 minutes West along said Highway for
422.4 feet;
thence
South 89 degrees 25 minutes East 184.0 feet;
thence
North 00 degrees 15 minutes East 184.5 feet;
thence
North 89 degrees 00 minutes East 593.5 feet to the POINT OF
BEGINNING.
5. (Monsanto
to Xxxxx)
Commencing
at the Southeast Xxxxxx xx Xxxxxxx 0, Xxxxxxxx 00 Xxxxx, Xxxxx 16
West, and run North 89 degrees 25 minutes West
400.0 feet;
thence
run North 00 degrees 15 minutes East 350.6 feet to the POINT OF
BEGINNING;
thence
run North 00 degrees 15 minutes East 819.7 feet to the center of
Xxxxx Xxxxxxx Xx. 000;
thence
run South 33 degrees 55 minutes West along said Highway for
979.8 feet;
thence
run South 89 degrees 25 minutes East 543.7 feet to the POINT OF
BEGINNING.
6. (NWF
to Xxxx Timber)
The East
Quarter of the Southwest Quarter of the Southeast Quarter
(E/4 SW/4 SE/4) and all that part of the Southeast Quarter of the
Southeast Quarter (SE/4 SE/4) of Xxxxxxx 0, Xxxxxxxx 00 Xxxxx,
Xxxxx 00 Xxxx, Xxxxx Xxxxxx, Xxxxxxxx, lying Xxxx xx Xxxxxxxx Xxxxx Xxxxxxx
#000.
Tract
41-12A:
1. (Xxxxxxx
to Monsanto)
Beginning
at the Northeast Corner (NECor) of Section 00, Xxxxxxxx 00 Xxxxx,
Xxxxx 00 Xxxx, Xxxxx Xxxxxx, Xxxxxxxx, and run South 00 degrees
15 minutes West 330.0 feet;
thence
North 89 degrees 25 minutes West 400.0 feet;
thence
North 00 degrees 15 minutes East 529.7 feet;
thence
North 89 degrees 00 minutes East 375.0 feet;
thence
South 00 degrees 15 minutes West 134.85 feet;
thence
South 89 degrees 25 minutes East 25.0 feet;
thence
South 00 degrees 15 minutes West 75.05 feet to the POINT OF
BEGINNING, and being part of the Southeast Quarter of the Southeast Quarter
(SE/4 SE/4) of Section 1, and part of the Northeast Quarter of the
Northeast Quarter (NE/4 NE/4) of Section 12, all in Township 17 South,
Range 16 West.
B-18
2. (Xxxxx
to Monsanto)
Beginning
at the Southeast Corner of the Northeast Quarter of the Northeast Quarter (XXXxx
NE/4 NE/4) of Section 00, Xxxxxxxx 00 Xxxxx, Xxxxx 00 Xxxx, Xxxxx
Xxxxxx, Xxxxxxxx, and run North 89 degrees 25 minutes West
400.0 feet;
thence
North 00 degrees 15 minutes East 990.0 feet;
thence
South 89 degrees 25 minutes East 400.0 feet;
thence
South 00 degrees 15 minutes West 990.0 feet to the POINT OF
BEGINNING.
Tract
41-16:
The North
Half of the Southwest Quarter of Section 0, Xxxxxxxx 00 Xxxxx,
Xxxxx 00 Xxxx, Xxxxx Xxxxxx, Xxxxxxxx.
Tract
41-17:
The
Northwest Quarter of the Southwest Quarter of Section 0, Xxxxxxxx 00
Xxxxx, Xxxxx 00 Xxxx, Xxxxx Xxxxxx, Xxxxxxxx.
Tract
41-18:
The
Southwest Quarter of the Southwest Quarter (SW1/4 SW 1/4) and the West Half of
the Southeast Quarter of the Southwest Quarter (W1/2 SE1/4 SW1/4) of
Xxxxxxx 0, Xxxxxxxx 00 Xxxxx, Xxxxx 15 West, Union County,
Arkansas
AND
Bginning
at the Northeast Corner of the Southeast Quarter of the Southwest Quarter (SE1/4
SW1/4) of Xxxxxxx 0, Xxxxxxxx 00 Xxxxx, Xxxxx 00 Xxxx, Xxxxx
Xxxxxx, Xxxxxxxx, and run North 88 degrees 53 minutes West
695.0 feet;
thnce South
00 degrees 11 minutes West 1326.0 feet to the South line of said
forty;
thence
South 88 degrees 53 minutes East along said South line
347.5 feet;
thence
North 00 degrees 11 minutes East 1290.4 feet;
thence
South 88 degrees 53 minutes East 347.5 feet;
thence
North 00 degrees 11 minutes East 26.0 feet to the POINT OF
BEGINNING.
Railroad
Right-of-Way:
Railroad
right-of-way extending 50 feet on each side of the centerline of the
railroad track as the same is now located, on, over and across the North Half of
Section 8, the North Half of Section 9, and the North Half of
Section 10, all in Township 17 South, Range 15 West.
B-19
Schedule
1
List of
Mortgages
1. Mortgage,
Assignment of Rents and Security Agreement and Fixture Filing Statement
(Alabama), dated as of November 2, 2007, between Cherokee Nitrogen Holdings,
Inc. and Banc of America Leasing & Capital LLC, as collateral agent for the
Lenders.
2. Mortgage,
Assignment of Rents and Security Agreement and Fixture Filing Statement
(Arkansas), dated as of November 2, 2007, between Northwest Financial
Corporation and Banc of America Leasing & Capital LLC, as collateral agent
for the Lenders.
ANNEX
A
Form of
Closing Date License
Closing
Date License
LICENSE
TO USE INTELLECTUAL PROPERTY RIGHTS
For the
purpose of enabling Xxxxx Fargo Foothill, Inc., as administrative agent (in such
capacity, the “Revolver Agent”)
under that certain Amended and Restated Loan and Security Agreement, dated as of
November 5, 2007 (as the same may be amended, restated, supplemented, modified,
refinanced, replaced or renewed from time to time, the “Revolving Loan
Agreement”) among LSB Industries, Inc. (the "Parent"),
ThermaClime, Inc. ("ThermaClime") and
certain of its subsidiaries, together with the Parent and ThermaClime, the
“Loan
Parties”), the financial institutions from time to time parties thereto
as lenders (the “Revolver Lenders”)
and the Revolver Agent, to enforce any Lien held by the Revolver Agent upon any
of the Revolver Collateral (as such terms are defined in the Inter-Lender
Agreement, dated as of even date herewith (the "Inter-Lender
Agreement"), by and among the Revolver Agent, Banc of America Leasing
& Capital, LLC, as collateral agent for the Term Loan Lenders (as defined
therein) under the Term Loan Agreement (as defined therein) (in such capacity
and together with any successor agent, the “Term Agent”)), and to
the extent appropriate, in the good faith opinion of the Revolver Agent, to
process, ship, produce, store, complete, supply, lease, sell, or otherwise
dispose of any of the Revolver Collateral or to collect or otherwise realize
upon any Accounts or Receivables (as defined in the Revolving Loan Agreement)
comprising Revolver Collateral, at such time as the Revolver Agent shall be
lawfully entitled to exercise such rights and remedies, each of the Loan Parties
hereby grant to the Revolver Agent, for the benefit of the Revolving Lenders,
and only to the extent set forth above, an irrevocable, nonexclusive license
(exercisable without payment of royalty or other compensation to the Obligors
(as defined in the Inter-Lender Agreement) to use[, license, or sublicense] any
intellectual property rights now owned or hereafter acquired by the Loan Parties
(except to the extent the terms of any of the foregoing proprietary rights or
any agreements relating thereto prohibit such grant of license to Agent), and
wherever the same may be located, and including in such license access to all
media in which any of the licensed items may be recorded or stored and to all
computer software and programs used for the compilation or printout
thereof. The Loan Parties hereby agree and acknowledge that no
further performance is required of the Revolver Agent under the terms of the
license granted pursuant hereto and that this license shall not constitute an
executory contract. Capitalized terms not otherwise defined herein
shall have the meanings given thereto in the Inter-Lender
Agreement. This License Agreement shall be subject in all cases to
the terms, conditions and limitations set forth in the Inter-Lender
Agreement.
THIS
LICENSE TO USE INTELLECTUAL PROPERTY RIGHTS SHALL BE GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES THEREOF (OTHER
THAN SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS
LAW).
Dated: October
__, 2007
Parent:
LSB
INDUSTRIES, INC.,
an
Delaware corporation
By: _____________________
Title:
Borrowers:
THERMACLIME,
INC.,
an
Oklahoma corporation
By: _____________________
Title:
CHEROKEE NITROGEN COMPANY, an
Oklahoma corporation
By: _____________________
Title:
CLIMATE
MASTER, INC.,
a
Delaware corporation
By: _____________________
Title:
CLIMATECRAFT,
INC.,
an
Oklahoma corporation
By: _____________________
Title:
CLIMACOOL,
CORP.,
an
Oklahoma corporation
By: _____________________
Title:
INTERNATIONAL ENVIRONMENTAL
CORPORATION, an Oklahoma
corporation
By: _____________________
Title:
THERMACLIME
TECHNOLOGIES, INC.,
an
Oklahoma corporation
By: _____________________
Title:
KOAX CORP., an Oklahoma
corporation
By: _____________________
Title:
LSB
CHEMICAL CORP.,
an
Oklahoma corporation
By: _____________________
Title:
XPEDIAIR, INC., an Oklahoma
corporation.
By: _____________________
Title:
EL
DORADO CHEMICAL COMPANY,
an
Oklahoma corporation
By: _____________________
Title:
CHEMEX I CORP., an Oklahoma
corporation
By: _____________________
Title:
an
Oklahoma corporation
By: _____________________
Title:
an
Oklahoma corporation
By: _____________________
Title:
EXHIBIT L
RECORDING
REQUESTED
BY
)
AND WHEN
RECORDED MAIL TO: )
Banc of
America Leasing & Capital LLC )
Bank of
America
)
MA5-100-32-01 )
000
Xxxxxxx
Xx.
)
Xxxxxx,
XX
00000 )
Attn.:
Xxxxxxxxx X. Xxxxxx,
VP
)
Group
Operations
Manager
)
Loan No.:
_______________________ )
)
______________________________________________________________________________________________
Space
above for Recorder's Use
ASSIGNMENT
OF LEASES AND RENTS, SUBORDINATION [AND NONDISTURBANCE] AGREEMENT
THIS ASSIGNMENT OF LEASES AND RENTS,
SUBORDINATION [AND NONDISTURBANCE] AGREEMENT (this "Assignment") is made
as of _____________________, by and among
______________________________,
a _________________________ as assignor ("Assignor"), with a
mailing address at 00 X. Xxxxxxxxxxxx, Xxxxxxxx Xxxx, Xxxxxxxx 00000, Attention:
____________________, and [name
of lessee under subject existing permitted lease], a
______________________________, (“Lessee”), with a mailing address at_______
________________________________________________________,
Attention ___________________________ in favor of Banc of
America Leasing & Capital LLC, as collateral agent for the Lenders
(hereinafter called the “Assignee” or the
“Collateral
Agent”), whose
address is c/o Xxxxxxxxx X. Xxxxxx, VP; Group Operations Manager, Bank of
America, MA5-100-32-01, 000 Xxxxxxx Xx., Xxxxxx, XX 00000.
RECITALS:
A. WHEREAS, upon the terms and
conditions of a certain Term Loan Agreement, dated as of the date hereof
(collectively, such agreement, as amended, restated, supplemented or otherwise
modified from time to time, being hereinafter referred to as the “Loan Agreement”), by
and among ThermaClime, Inc., an Oklahoma corporation (“ThermaClime”),
Cherokee Nitrogen Holdings, Inc., an Oklahoma corporation, Northwest Financial
Corporation, an Oklahoma corporation, Chemex I Corp., an Oklahoma corporation,
Chemex II Corp, an Oklahoma corporation, Cherokee Nitrogen Company, an Oklahoma
corporation, ClimaCool Corp., an Oklahoma corporation, ClimateCraft, Inc., an
Oklahoma corporation, Climate Master, Inc., a Delaware corporation, DSN
Corporation, an Oklahoma corporation, El Dorado Chemical Company, an Oklahoma
corporation, International Environmental Corporation, an Oklahoma corporation,
Koax Corp., an Oklahoma corporation, LSB Chemical Corp., an Oklahoma
corporation, The Climate Control Group, Inc., an Oklahoma corporation, Trison
Construction, Inc., an Oklahoma corporation, ThermaClime Technologies, Inc., an
Oklahoma corporation, and XpediAir, Inc., an Oklahoma corporation, as borrowers
(individually and collectively, jointly and severally, “Borrower” or “Borrowers”), LSB
Industries, Inc., as guarantor, Banc of America Leasing & Capital, LLC, as
administrative agent (the “Administrative
Agent”), the Collateral Agent and the Lenders from time to time party
thereto (the “Lenders”;
collectively with the Administrative Agent and the Collateral Agent, the “Secured Parties”),
Secured Parties have agreed to provide certain financial accommodations (the
“Loan”) to
Borrowers, upon the terms and conditions set forth in the Loan Agreement and the
other Loan Documents.
B. The
Loan is secured by that certain Mortgage, Assignment of Rents and Security
Agreement and Fixture Filing (the "Mortgage"), dated as
of the date of this Agreement, from Assignor, as ‘mortgagor”, for the benefit of
Assignee, as “mortgagee, encumbering real property located in the County of
Colbert, State of Alabama, as described on Exhibit A
attached hereto, and all buildings and other improvements now or hereafter
located thereon (collectively, the "Improvements") (the
real property and the Improvements are hereinafter sometimes collectively
referred to as the "Property");
C. The
Loan Documents (as defined in the Loan Agreement) include the Mortgage, one or
more promissory note(s) (each and collectively, the “Note”) and all other
documents evidencing, securing or otherwise pertaining to the
Loan. This Agreement is one of the Loan Documents;
D. Assignor
(or Assignor’s predecessor-in-interest) and Lessee are parties to the following
lease agreement:
__________________________________________________________________________________[i
dentify
subject Exhibiting Permitted Lease
___________________________________________________________________________________
dated
________________________, _____ (the “Lease”), pursuant to which Lessee leases
from Assignor certain real property legally described on the attached Exhibit A and certain
improvements located thereon (the “Premises”). The Premises is or
will be encumbered by the Mortgage securing the Loan in favor of
Assignee. Lessee has agreed to recognize the rights of Assignee in
accordance with the terms and provisions of this Agreement; and
E. As
a condition to making the Loan to Borrowers, Assignee has required that Assignor
and Lessee execute and deliver this Agreement to further secure payment and
performance of Assignor's obligations under the Loan Documents.
NOW, THEREFORE, to induce Assignee to
enter into the Loan Documents and to make the Loan, and in consideration thereof
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, Assignor and Lessee hereby covenant and agree for
the benefit of Assignee, as follows:
2
Covenants of Assignor with
respect to Assignment:
1. Absolute
Assignment. Assignor hereby absolutely and presently assigns
to Assignee the following:
(a) All
of Assignor's right, title and interest in, to and under the Lease, including
(i) all guaranties of and security for Lessee’s performance under the Lease, and
(ii) all amendments, extensions, renewals or modifications to the lease;
and
(b) All
deposits (whether for security or otherwise), rents, issues, profits, revenues,
royalties, rights, benefits and income of and from the Property, including
liquidated damages following default and all proceeds payable under any policy
of insurance covering loss of rents, together with the continuing right to
collect and receive the same, and together with all rights and claims that
Assignor may have against any party under the Lease or against any other
occupant of the Property (collectively, the "Rents").
THIS IS
AN ABSOLUTE ASSIGNMENT, NOT AN ASSIGNMENT FOR SECURITY ONLY.
2. Grant of
License. Assignee hereby confers upon Assignor a license (the
"License") to
collect and retain the Rents as they become due and payable, so long as no Event
of Default (as defined in the Mortgage) shall exist and be
continuing. If an Event of Default has occurred and is continuing,
Assignee shall have the right, which it may choose to exercise in its sole
discretion, to terminate the License without notice to or demand upon Assignor,
and without regard to the adequacy of Assignee's security under the Loan
Documents.
3. Collection and Application
of Rents. Subject to the License granted to Assignor
under Section 2 above,
Assignee has the right, power and authority to collect any and all Rents after
the occurrence and during the continuance of an Event of
Default. Assignor hereby appoints Assignee its attorney-in-fact,
which power of attorney is with full power of substitution and coupled with an
interest, after the occurrence and during the continuance of an Event of Default
to perform any and all of the following acts as Assignee, in its sole
discretion, may elect:
(a) Demand,
receive and enforce payment of any and all Rents;
(b) Give
receipts, releases and satisfactions for any and all Rents; or
(c) Xxx
either in the name of Assignor or in the name of Assignee for any and all
Rents.
Assignee may, in its sole discretion,
choose to collect Rents either with or without taking possession of the
Property. Even if Assignee is collecting and applying Rents as
permitted under this Assignment, Assignee shall still be entitled, upon an Event
of Default, to exercise and invoke every right and remedy provided to it under
this Agreement, the Mortgage, or under any of the other Loan
Documents.
Covenants of Lessee,
Assignee and Assignor with respect to Subordination:
4. Subordination. Notwithstanding
anything to the contrary contained in the Lease, the Lease and the leasehold
estate created thereby are hereby declared to be, and hereafter shall continue
at all times to be, junior, subject and subordinate, in each and every respect,
to the Mortgage, including, without limitation, (i) any and all increases,
renewals, modifications, extensions, substitutions,
3
replacements
and or consolidations of the Note or the Mortgage and (ii) any future mortgage
or encumbrance affecting the Premises held by or made for the benefit of
Assignee and/or its successors and assigns. The foregoing
subordination is effective and self-operative without the necessity for
execution of any further instruments. Lessee hereby covenants with
Assignee that Lessee will not cause the Lease to be subordinated to any
interests other than those held by or made for the benefit of Assignee and/or
its successors and assigns without prior written notice to and prior written
consent of Assignee. At any time at the election of Assignee,
Assignee shall have the right to declare the Lease superior to the lien,
provisions, operation and effect of the Mortgage.
5. Attornment;
Nondisturbance.
a) Notwithstanding the foregoing
subordination, if the interest of Assignor under the Lease shall be transferred
by reason of foreclosure or other proceedings (judicial or non judicial) for
enforcement of the Mortgage or by reason of a deed in lieu of foreclosure,
Lessee, at the election of the transferee and its successors and assigns (the
“Purchaser”) acquiring said interests, shall be bound to the Purchaser pursuant
to all of the terms, covenants and conditions of the Lease for the balance of
the term of the Lease then remaining and any extensions or renewals thereof
which may be effected in accordance with any option therefor in the Lease, with
the same force and effect as if the Purchaser were the original Assignor under
the Lease, and Lessee does hereby attorn to and agree to attorn to the
Purchaser, as its Assignor, said attornment to be effective and self-operative
without the necessity for execution of any further instruments, upon Purchaser’s
election after succeeding to the interest of the Assignor under the
Lease.
b) Notwithstanding
the provisions of Section 4 and
provided that Lessee is not in default under the Lease, Purchaser shall be bound
to Lessee and its successors and assigns pursuant to all of the terms, covenants
and conditions of the Lease for the balance of the term of the Lease then
remaining and any extensions or renewals thereof which may be effected in
accordance with any option set forth in the Lease, with the same force and
effect as if Purchaser were the original Assignor under the Lease, and provided
that Lessee is not in default under the Lease beyond any applicable cure
periods, the Lease shall not be terminated, nor shall Lessee’s use, possession
or enjoyment of the Premises be interfered with, nor shall the leasehold estate
granted by the Lease be affected in any other manner, in any foreclosure or any
action or proceeding instituted under or in connection with the
Mortgage.
6. Further
Acts. Notwithstanding any provisions contained in Sections 4 and 5 above which state
that the attornment and subordination by Lessee to Assignee and Purchaser are
effective and self-operative without the execution of any further instrument,
Lessee agrees that, upon request of Assignee and/or Purchaser, it will execute
such written agreement to evidence and affirm any and all of Lessee’s
obligations under this Agreement, and further, Lessee agrees that it will
execute from time to time such further assurances and estoppel certificates as
may reasonably be requested by Assignee and Purchaser. Without
limiting the generality of the foregoing, if and to the extent that Assignor
rejects the Lease in any federal or state proceeding, Lessee will, upon the
request of Assignee or Purchaser after exercise by Assignee of its remedies in
enforcement of the Mortgage, immediately enter into a new lease directly with
the Assignee or Purchaser on the same terms as the Lease (for the then-unexpired
term of the Lease), provided execution of such new lease does not violate any
bankruptcy law or related court order.
7. Limitation. Neither
Assignee nor any Purchaser shall be (a) liable for any act or omission of
Assignor or any prior Assignor (including the loss or misappropriation of any
rental payments or security deposits); (b) subject to any credits, claims,
setoffs, offsets or defenses which Lessee may have against Assignor or any prior
Assignor; (c) bound by (or responsible for) any advance payment of rent or any
other monetary obligations under the Lease to Assignor in excess of one month’s
prepayment thereof in the case of rent, or in excess of one periodic payment in
advance in the case of
4
any other
monetary obligations under the Lease; (d) responsible for any security deposit
not actually received by Assignee or any Purchaser; (e) bound by any amendment,
assignment (in whole or in part), subletting, extension, renewal or modification
of the Lease to which Assignee or Purchaser has not consented in writing (to the
extent such consent by Assignee is required under the Loan Documents), and any
attempted amendment, assignment (in whole or in part), subletting, extension,
renewal or modification of the Lease without said consent (to the extent such
consent by Assignee is required under the Loan Documents) shall be null and void
and of no force and effect; provided, however, that the consent of the Assignee
or Purchaser is not required for (i) an assignment or subletting entered into
pursuant to such provision of the Lease as shall expressly provide that Lessee
may effect such assignment or subletting without the consent of Assignor or (ii)
an extension of the term of such Lease; (f) liable for latent and/or patent
defects in the construction of the Premises; (g) liable for any breach of any
warranty in the Lease by Assignor or a prior Assignor; (h) bound by any
obligation to repair, replace, rebuild or restore the Premises, or any part
thereof, in the event of damage by fire or other casualty, or in the event of
partial condemnation, beyond such repair, replacement, rebuilding or restoration
as may be required of the Assignor under the Lease and as can reasonably be
accomplished with the use of the net insurance proceeds or the net condemnation
award actually received by or made available to Assignee (as successor in
interest to Assignor) or Purchaser; (i) required to remove any person occupying
the Premises or any part thereof; or (j) bound by any right of first refusal or
right of first offer set forth in the Lease. Neither Assignee nor any
Purchaser shall be liable for any reason for amounts in excess of the value of
its interest in the Premises, or for consequential or punitive damages of any
kind
8. Notice; Cure;
Waivers. Lessee agrees to give prompt written notice to
Assignee (and to any successor in interest to Assignee of which Lessee has been
notified) of any default of the Assignor under the Lease if such
default is of such a nature as to give Lessee a right to terminate the Lease,
reduce rent or to credit or offset any amounts against future
rents. If, within thirty (30) days after receipt of written notice
from Lessee, Assignee, at Assignee’s sole option, cures (or commences and is
diligently pursuing the cure of) a default of Assignor under the Lease that is
capable of being cured by Assignee, Lessee agrees not to terminate the Lease,
reduce rent, credit or offset against future rents, consent or acquiesce in the
termination of the Lease or surrender the Premises and agrees to continue to be
bound by the terms of the Lease and this Agreement. To the extent
that Assignee is only able to effect cure of such default after taking
possession of the Premises or exercising its right to foreclowure under the
mortgage, Lessee agrees hat the time for cure of such default by Assignee shall
be extended for the time reasonably required to obtain such possession or effect
such foreclosure.
9. Payments of Rent to
Assignee. Assignor absolutely assigns to Assignee all payments
of rent as the same are due under the Lease (the “Rent”) and Lessee agrees that
within thirty (30) days after notice delivered to Lessee of an uncured Event of
Default (as defined in the Mortgage) by the Assignee and until such time as all
of Assignor’s monetary obligations to Assignee pursuant to the Note and the Loan
Agreement between Assignee and Borrowers have been fully paid or such Event of
Default has been cured (and Assignee and Lessee shall have notice of such cure),
Lessee will pay the Rent directly to Assignee. All such rental
payments received by Assignee shall be credited against Assignor’s obligations
to Assignee. Assignor, by its execution hereof, agrees that this
Agreement does not constitute a waiver by Assignee of any of Assignee’s rights
under the Mortgage and any assignment of leases or rents contained therein, or
in a separate instrument or in any way release the Assignor from any of the
terms, conditions, obligations, covenants and agreements of the
Mortgage.
10. Notices. All
notices, consents, approvals or other instruments required or permitted to be
given by any party pursuant to this Agreement shall be in writing and given by
(i) hand delivery, (ii) express overnight delivery service or (iii) certified or
registered mail, return receipt requested, and shall be deemed to have been
delivered upon (a) receipt, if hand delivered, (b) the next business day, if
delivered by express overnight delivery service, or (c) the third business day
following the day of deposit of such notice with the United States Postal
Service, if sent by certified or registered mail, return receipt
5
requested. Notices
shall be provided to the parties and addresses (or facsimile numbers, as
applicable) as set forth in the introductory paragraph hereto.
11. Remedies of
Assignee. Upon or at any time after the occurrence and during
the continuance of an Event of Default, Assignee may, at its option, without
waiving such Event of Default and without regard to the adequacy of Assignee's
security under the Loan Documents, either in person, by agent, or by a receiver
appointed by a court, take possession of the Property and hold, manage, lease
and operate the Property on such terms and for such period of time as provided
in the Mortgage. Assignee may, with or without taking possession of
the Property, in its own name, demand, xxx for or otherwise collect and receive
all Rents, including those past due and unpaid. Assignee shall have
full power to make all alterations, renovations, repairs or replacements and to
do any and all other things which it may in its sole discretion consider
necessary or appropriate to protect the security of this Agreement and under the
Mortgage. Assignee may apply the Rents to pay any of the following
amounts and in such order as provided in the Mortgage: (a) the
Secured Obligations (as defined in the Mortgage); (b) all expenses of the
Property, including the salaries, fees, commissions and wages of a managing
agent and such other employees, agents or independent contractors as Assignee
deems necessary or desirable; (c) all taxes, charges, claims, assessments,
or any other liens against the Property; (d) all premiums for all insurance
Assignee deems necessary or desirable; (e) the cost of all alterations,
renovations, repairs or replacements; and (f) all expenses incident to
taking and retaining possession of the Property. Neither the demand
for nor collection of Rents by Assignee shall constitute any assumption by
Assignee of any obligation under the lease. Assignee is obligated to
account only for such Rents as are actually collected or received by
Assignee. For purposes of this Section, Assignor grants to Assignee
its irrevocable power of attorney, with full power of substitution and coupled
with an interest, to take any and all of the aforementioned actions and any or
all other actions designated by Assignee for the proper management and
preservation of the Property. Assignee shall, as a matter of absolute
right, be entitled, upon application to a court of applicable jurisdiction, to
the appointment of a receiver to obtain and secure the rights of Assignee
hereunder and the benefits intended to be provided to Assignee under this
Agreement. The exercise by Assignee of the option granted it in this
Section and the collection of the Rents and the application thereof as provided
in this Agreement shall not be considered a waiver of any Event of Default by
Assignor under the note(s), the Mortgage, this Agreement or the other Loan
Documents. This Agreement shall remain in full force and effect
during any period of foreclosure and/or redemption with respect to the
Property.
12. No Liability of
Assignee. Assignee shall not be liable for any loss sustained
by Assignor resulting from Assignee’s failure to lease any part of the Property
or from any other act or omission of Assignee in managing the Property after an
Event of Default, other than acts or omissions of Assignee constituting willful
misconduct or gross negligence of Assignee. Assignee shall not be
responsible for performing any of Assignor's obligations under the lease by
reason of this Agreement. Assignor hereby agrees to indemnify, defend
and hold Assignee harmless for, from and against any and all liability, loss or
damage which may be incurred under the lease or by reason of this Agreement and
from any and all claims and demands whatsoever, including the defense of any
such claims or demands which may be asserted against Assignee by reason of any
alleged obligations and undertakings on its part to perform or discharge any of
the terms, covenants or agreements contained in the lease. Should
Assignee incur any such liability, Assignor shall reimburse Assignee promptly
upon demand. This Agreement shall not operate to place any obligation
or liability for the control, care, management or repair of the Property upon
Assignee, nor shall it operate to make Assignee responsible or liable for any
waste committed on the Property by any lessee or any other party, any dangerous
or defective condition of the Property, including, without limitation, the
presence of any Hazardous Substances (as defined in the Loan Agreement), or for
any negligence in the management, upkeep, repair or control of the Property
resulting in loss or injury or death to any lessee, licensee, employee or
stranger, other than acts or omissions of Assignee constituting gross negligence
or willful misconduct of Assignee.
6
13. Other
Security. Assignee may take or release other security for the
payment of the Secured Obligations, may release any party primarily or
secondarily liable therefor and may apply any other security held by it to the
reduction or satisfaction of the Secured Obligations without prejudice to any of
its rights under this Agreement.
14. Other
Remedies. Assignor has executed the Mortgage which contains an
Assignment of Rents and Leases assigning to Assignee all of Assignor's right,
title and interest, as Assignor, in and to the lease. All rights and
remedies granted to Assignee under the Assignment of Rents and Leases contained
in the Mortgage shall be in addition to all rights and remedies granted to
Assignee under this Agreement. The right of Assignee to collect the
Secured Obligations and to enforce any other security held by Assignee may be
exercised by Assignee either prior to, simultaneously with, or subsequent to any
action taken by it under this Agreement.
15. No Mortgagee in
Possession. Nothing contained in this Agreement shall be
construed as constituting Assignee a "mortgagee in possession" for any
purpose.
16. Conflict of
Terms. In case of any conflict between the terms of this
Agreement and the terms of the Mortgage, the terms of the Mortgage shall
prevail.
17. Non-Waiver. Each
waiver by any Assignee must be in writing, and no waiver shall be construed as a
continuing waiver. No waiver shall be implied from any delay or failure by
Assignee to take action on account of any default of Assignor. Consent by
Assignee to any act or omission by Assignor shall not be construed as a consent
to any other or subsequent act or omission or to waive the requirement for
Assignee's consent to be obtained in any future or other instance. No
collection by Assignee of any Rents pursuant to this Agreement shall constitute
or result in a waiver of any default then existing under this Agreement or under
any of the other Loan Documents.
18. Invalid
Provisions. A determination that any provision of this
Agreement 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 Agreement 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.
19. Governing
Law. This Agreement shall be governed by and construed in
accordance with the laws of the state where the Property is located, except to
the extent any of such laws may now or hereafter be preempted by Federal
law.
20. Termination of
Assignment. Upon payment in full of the Secured Obligations
and the delivery and recording of a satisfaction, release, reconveyance or
discharge of the Mortgage duly executed by Assignee, this Agreement shall become
and be void and of no effect.
21. Successors in Interest;
Transfer of Loan. The terms, covenants and conditions of this
Agreement shall be binding upon and inure to the benefit of the heirs,
successors and assigns of the parties. Assignee and any successor may, at
any time, sell, transfer, or assign the Loan, this Agreement and the other Loan
Documents, and any or all servicing rights with respect thereto, or grant
participations therein or issue mortgage pass-through certificates or other
securities evidencing a beneficial interest in a rated or unrated public
offering or private placement (the "Securities"). Assignee
may forward to each Assignee, transferee, assignee, servicer, participant,
investor in such Securities or any rating agency (a "Rating Agency")
rating such Securities (all of the foregoing entities collectively referred to
as an "Investor") and each
prospective Investor, all documents, financial and other information which
Assignee now has or may hereafter acquire relating to (a) the Loan; (b) the
Property and its operation (including, without limitation, copies of all leases,
subleases or any other agreements
7
concerning
the use and occupancy of the Property); and/or (c) any party connected with the
Loan (including, without limitation, Assignor, any partner or member of
Assignor, any constituent partner or member of Assignor, and any
guarantor). In connection with such Securities, Assignor further
agrees that the Loan Documents shall be sufficient evidence of the obligations
of Assignor to each Investor. Assignor shall, within fifteen
(15) days after request by Assignee, deliver an estoppel certificate verifying
for the benefit of Assignee and any other party designated by Assignee the
status and the terms and provisions of the Loan in form and substance acceptable
to Assignee. The representations, warranties, obligations, covenants,
and indemnity obligations of Assignor under the Loan Documents shall also
benefit and apply with respect to any Assignee, transferee, assignee,
participant, servicer or investor.
22. Attorneys'
Fees. If any lawsuit, suit or proceeding is commenced which
arises out of or relates to the Loan Agreement, this Agreement, the other Loan
Documents or the Loan, the prevailing party shall be entitled to recover from
each other party such sums as the court may adjudge to be reasonable attorneys'
fees in the action, in addition to costs and expenses otherwise allowed by
law. In all other situations, including any matter arising out of or
relating to any proceeding under any Debtor Relief Law (as defined in the
Mortgage), Assignor agrees to pay all of Assignee's costs and expenses,
including attorneys' fees, which may be incurred in enforcing or protecting
Assignee's rights or interests. From the time(s) incurred until paid
in full to Assignee, all such sums shall bear interest at the Default
Rate. Whenever Assignor is obligated to pay or reimburse Assignee for
any attorneys' fees, those fees shall include the allocated costs for services
of in-house counsel.
23. WAIVER OF TRIAL BY
JURY. ASSIGNOR HEREBY AGREES NOT TO ELECT A TRIAL BY JURY OF
ANY ISSUE TRIABLE OF RIGHT BY JURY, AND WAIVES ANY RIGHT TO TRIAL BY JURY FULLY
TO THE EXTENT THAT ANY SUCH RIGHT SHALL NOW OR HEREAFTER EXIST WITH REGARD TO
THE LOAN, THE LOAN DOCUMENTS, OR ANY CLAIM, COUNTERCLAIM OR OTHER ACTION ARISING
IN CONNECTION THEREWITH. THIS WAIVER OF RIGHT TO TRIAL BY JURY IS
GIVEN KNOWINGLY AND VOLUNTARILY BY ASSIGNOR, AND IS INTENDED TO ENCOMPASS
INDIVIDUALLY EACH INSTANCE AND EACH ISSUE AS TO WHICH THE RIGHT TO A TRIAL BY
JURY WOULD OTHERWISE ACCRUE. ASSIGNEE IS HEREBY AUTHORIZED TO FILE A
COPY OF THIS PARAGRAPH IN ANY PROCEEDING AS CONCLUSIVE EVIDENCE OF THIS WAIVER
BY ASSIGNOR.
IN WITNESS WHEREOF, Assignor, Lessee
and Assignee have executed this Agreement as of the day and year first above
written.
ASSIGNOR:
____________________________________,.
a
__________________________________
By:
________________________________
Name:______________________________
Title: ______________________________
LESSEE:
____________________________________,.
a
__________________________________
8
By: ________________________________
Name: ______________________________
Title: _______________________________
ASSIGNEE:
BANC OF
AMERICA LEASING & CAPITAL, LLC,
By:________________________________
Name:
_____________________________
Title: _____________________________
9
EXHIBIT A
LEGAL
DESCRIPTION
[ACKNOWLEDGEMENT]
STATE
OF _________________________)
)
COUNTY
OF _______________________)
On
____________________, before me, _________________________, a Notary Public in
and for the State of ____________________, personally appeared
_________________________, personally known to me (or proved to me on the basis
of satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to
the within instrument and acknowledged to me that he/she/they executed the same
in his/her/their authorized capacity(ies), and that by his/her/their
signature(s) on the instrument the person(s), or the entity upon behalf of which
the person(s) acted, executed the instrument.
WITNESS
my hand and official seal.
__________________________________ [SEAL]
EXHIBIT M
TRADEMARK SECURITY
AGREEMENT
This
TRADEMARK SECURITY AGREEMENT, dated as of October ___, 2007, is made by EL
DORADO CHEMICAL COMPANY, an Oklahoma corporation, 00 Xxxxx Xxxxxxxxxxxx Xxxxxx,
Xxxxxxxx Xxxx, Xxxxxxxx 00000 (“Grantor”), in favor
of BANC OF AMERICA LEASING & CAPITAL, LLC, a ___________ limited liability
company, as Administrative Agent and Collateral Agent for the other Lenders (in
such capacity, “Agent”) that are now
or hereafter at any time parties to the Term Loan Agreement (as defined
below).
W I T N E S S E T H:
WHEREAS,
pursuant to that certain Loan Agreement, dated as of October ___, 2007, by and
among Grantor, as Borrowers, the Agent and the Lenders party thereto (including
all annexes, exhibits and schedules thereto, as from time to time amended,
restated, supplemented or otherwise modified, the “Loan Agreement”),
Lenders have agreed to make the Term Loans to Borrowers;
WHEREAS,
in connection with the Loan Agreement and the Other Agreements, Grantor, as
Borrowers shall have executed and delivered to Agent, for the benefit of itself
and the Lenders, that certain Security Agreement dated as of the date hereof
(including all annexes, exhibits or schedules thereto, as from time to time
amended, restated, supplemented or otherwise modified, the “Security
Agreement”);
WHEREAS,
pursuant to the Security Agreement, Grantor is required to execute and deliver
to Agent, for the benefit of itself and the other Lenders, this Trademark
Security Agreement;
NOW,
THEREFORE, in consideration of the premises and mutual covenants herein
contained and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Grantor hereby agrees as
follows:
1. DEFINED
TERMS. All capitalized
terms used but not otherwise defined herein have the meanings given to them in
the Loan Agreement.
2. GRANT
OF SECURITY INTEREST IN TRADEMARK COLLATERAL. Grantor hereby grants to
Agent, on behalf of itself and the other Lenders, a continuing security interest in all of Grantor’s
right, title and interest in, to and under the following, whether presently
existing or hereafter created or acquired (collectively, the “Trademark
Collateral”) subject only
to the Permitted Liens:
(a) all
of its Trademarks and Trademark Licenses to which it is a party including those
referred to on Schedule I
hereto;
(b) all
renewals or extensions of the foregoing;
(c) all
goodwill of the business connected with the use of, and symbolized by, each
Trademark and each Trademark License; and
(d) all
products and proceeds of the foregoing, including, without limitation, any claim
by Grantor against third parties for past, present or future (i) infringement or
dilution of
any
Trademark or Trademark licensed under any Trademark License or (ii) injury to
the goodwill associated with any Trademark or any Trademark licensed under any
Trademark License.
3. SECURITY
AGREEMENT. The security interests granted pursuant to this
Trademark Security Agreement are granted in conjunction with the security
interests granted to Agent, for the benefit of itself and the other Lenders,
pursuant to the Security Agreement. Grantor hereby acknowledges and
affirms that the rights and remedies of Agent with respect to the security
interest in the Trademark Collateral made and granted hereby are more fully set
forth in the Security Agreement, the terms and provisions of which are
incorporated by reference herein as if fully set forth herein.
Signatures
continued on next page.
IN
WITNESS WHEREOF, Grantor has caused this Trademark Security Agreement to be
executed and delivered by its duly authorized officer as of the date first set
forth above.
EL DORADO CHEMICAL COMPANY
By: ________________________________
Name: ______________________________
Title: _______________________________
ACKNOWLEDGMENT OF
GRANTOR
STATE OF
________________)
) ss.
COUNTY OF
______________)
On this
____ day of October, 2007 before me personally appeared _____________
____________, proved to me on the basis of satisfactory evidence to be the
person who executed the foregoing instrument on behalf of each Grantor, who
being by me duly sworn did depose and say that he is an authorized officer of
Grantor, that the said instrument was signed on behalf of Grantor as
authorized by its respective board of directors and that he acknowledged said
instrument to be the free act and deed of each such Grantor.
_____________________________
(seal) Notary
Public
ACCEPTED
AND ACKNOWLEDGED BY:
BANC
OF AMERICA LEASING & CAPITAL, LLC,
as Administrative
Agent and Collateral Agent
By: ____________________________________
Name: __________________________________
Title: __________________________________
SCHEDULE
I
to
TRADEMARK
SECURITY AGREEMENT
TRADEMARK REGISTRATIONS
U.S. Federal Trademark
Registrations
| Xxxx | Reg. No. | Date |
|
EL
DORADO (& Design)
|
1,427,064
|
02/03/87
|
|
E-2
|
833,891
|
08/22/67
|
TRADEMARK
APPLICATIONS
None
TRADEMARK
LICENSES
None
Page
5
