Loan and Security Agreement
EXHIBIT
10.1
This Loan
and Security Agreement (as it may be amended, this "Agreement")
is entered into on April 21, 2008 by and between Renewal Plantations,
Inc.,
a Delaware corporation (the "Borrower"),
whose principal office is located at 0000 Xxxxx Xxxxxxx Xxxxxx, Xxxxxxxxx,
XX ("Borrower’s
Address"), and Phoenix Investors, LLC.,
a corporation, whose principal office is located at 0000 Xxxxx Xxxxxxx
Xxxxxx, Xxxxxxxxx, XX (the “Lender”). The
Schedules to this Agreement are an integral part of this Agreement and are
incorporated herein by reference. Terms used, but not defined
elsewhere, in this Agreement are defined in Schedule A.
1. LOANS.
1.1 Amount.
Subject
to the terms and conditions contained in this Agreement, Lender will provide
funds of up to Five Hundred Thousand dollars ($500,000) from time to time upon
the written request of Borrower to Lender. The lending of any such
funds pursuant to this Agreement shall be in the sole discretion of the Lender
and shall be dependent among other thing on receipt of the following, all of
which shall be to the satisfaction of the lender: detailed use of
proceeds, budget, timelines for application of proceeds and milestone
requirements. All amount loaned hereunder shall be referred to as
“Term Loans.”
1.2 Repayment.
Accrued
interest on all Term Loans shall be payable on the first day of each
month. Outstanding principal and all accrued but unpaid interest of
the Term Loans shall be repaid on July 15, 2008 (the “Maturity
Date”). The Term Loans shall be evidenced by the form of promissory
note attached hereto as Exhibit A.
1.3 Interest.
All Term
Loans shall bear interest at thirteen percent (13.0%) based on the actual
number of days elapsed in a year of 360 days (the “Interest Rate”); provided, that after the occurrence
of an Event of Default, all Term Loans and other monetary obligations shall, at
Lender's option, bear interest at a rate per annum equal to four percent
(4%) in excess of the rate otherwise applicable thereto (the "Default Rate") until paid in full
(notwithstanding the entry of any judgment against any Borrower or the exercise
of any other right or remedy by Lender), and all such interest shall be payable
on demand. Notwithstanding anything to the contrary contained in this
Agreement, the aggregate of all amounts deemed to be interest hereunder and
charged or collected by Lender is not intended to exceed the highest rate
permissible under any applicable law, but if it should, such interest shall
automatically be reduced to the extent necessary to comply with applicable law
and Lender will refund to Borrower any such excess interest received by
Lender.
1.4 Origination Fee; Purchase
Warrants.
In
connection with the Loans made hereunder, the Lender shall (i) be paid a loan
original fee of 10% of
the principal lent to Borrower, capped at $50,000, and accrued as principal is
drawn; and (ii) receive common stock purchase warrants in the form
attached hereto as Exhibit B, to purchase 20,000,000 shares of the common stock
of Renewal Fuels, Inc., a Delaware corporation, the parent corporation of the
Borrower.
2. SECURITY
INTEREST.
2.1 Grant of
Security Interest.
To secure
the full payment and performance of all of the Obligations, Borrower hereby
assigns to Lender and grants to Lender a continuing security interest in the
following property of Borrower, whether tangible or intangible, now or hereafter
owned, existing, acquired or arising and wherever now or hereafter located, and
whether or not eligible for lending purposes: (i) all Accounts
(whether or not Eligible Accounts) and all Goods whose sale, lease or other
disposition by such Borrower has given rise to Accounts and have been returned
to, or repossessed or stopped in transit by, Borrower; (ii) all Chattel
Paper, Instruments, Documents and General Intangibles (including all
patents, patent applications, trademarks, trademark applications, trade names,
trade secrets, goodwill, copyrights, copyright applications, registrations,
licenses, software, franchises, customer lists, tax refund claims, claims
against carriers and shippers, guarantee claims, contracts rights, payment
intangibles, security interests, security deposits and rights to
indemnification); (iii) all Inventory; (iv) all Goods (other than
Inventory), including Equipment, vehicles and Fixtures; (v) all Investment
Property; (vi) all Deposit Accounts, bank accounts, deposits and cash;
(vii) all Letter-of-Credit Rights; (viii) all Commercial Tort Claims;
(ix) all Supporting Obligations; (x) any other property of Borrower
now or hereafter in the possession, custody or control of Lender or any agent or
any parent, Affiliate or Subsidiary of Lender or any participant with Lender in
the Loans, for any purpose (whether for safekeeping, deposit, collection,
custody, pledge, transmission or otherwise) and (xi) all additions and
accessions to, substitutions for, and replacements, products and Proceeds of the
foregoing property, including proceeds of all insurance policies insuring the
foregoing property, and all of Borrower’s books and records relating to any of
the foregoing and to such Borrower’s business.
2.2 Possessory
Collateral.
Immediately
upon Borrower's receipt of any portion of the Collateral evidenced by an
agreement, Instrument or Document, including any Tangible Chattel Paper and any
Investment Property consisting of certificated securities, such Borrower shall
deliver the original thereof to Lender together with an appropriate endorsement
or other specific evidence of assignment thereof to Lender (in form and
substance acceptable to Lender). If an endorsement or assignment of
any such items shall not be made for any reason, Lender is hereby irrevocably
authorized, as Borrower's attorney and agent-in-fact, to endorse or assign the
same on Borrower's behalf.
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2.3 Preservation
of Collateral and Perfection of Security Interest Therein.
Borrower
shall, at Lender's request, at any time and from time to time, authenticate,
execute and deliver to Lender such financing statements, documents and other
agreements and instruments (and pay the cost of filing or recording the same in
all public offices deemed necessary or desirable by Lender) and do such other
acts and things or cause third parties to do such other acts and things as
Lender may deem necessary or desirable in its sole discretion in order to
establish and maintain a valid, attached and perfected security interest in the
Collateral in favor of Lender (free and clear of all other liens, claims,
encumbrances and rights of third parties whatsoever, whether voluntarily or
involuntarily created, except Permitted Liens) to secure payment of the
Obligations and to facilitate the collection of the
Collateral. Borrower authorizes Lender to file, transmit, or
communicate, as applicable, financing statements and amendments describing the
Collateral as "all personal property of debtor" or "all assets of debtor" or
words of similar effect, in order to perfect Agent's security interest in the
Collateral without any Borrower's signature. Borrower also hereby
ratifies its authorization for Lender to have filed in any jurisdiction any
financing statements filed prior to the date hereof.
3. REPRESENTATIONS,
WARRANTIES AND COVENANTS.
To induce
Lender to enter into this Agreement, the Borrower represents, warrants and
covenants as follows (it being understood that (i) each such representation
and warranty will be deemed remade as of the date on which each Term Loan is
made and shall not be affected by any knowledge of, or any investigation by,
Lender, and (ii) the accuracy of each such representation, warranty and
covenant will be a condition to each Term Loan):
For
purposes of this Agreement, the term “Material Adverse Effect” when used in
connection with the Borrower means any change, event, violation, inaccuracy,
circumstance or effect that is materially adverse to the business, assets
(including intangible assets), capitalization, financial condition or results of
operations of the Borrower and its subsidiaries taken as a whole. For
purposes of this Agreement, the term “Person” shall mean any individual,
corporation (including any non-profit corporation), general partnership, limited
partnership, limited liability partnership, joint venture, estate, trust,
company (including any limited liability company or joint stock company), firm
or other enterprise, association, organization, entity or Governmental Entity
(as hereinafter defined).
3.1 Organization and Good
Standing of the Borrower. The
Borrower is a corporation duly organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation as set forth above. The
Borrower is not required to be qualified to transact business in any other
jurisdiction where the failure to so qualify would have an adverse effect on the
business of the Borrower.
3.2 Authority.
(a) The Borrower
has full power and authority (corporate and otherwise) to carry on its business
and has all permits and licenses that are necessary to the conduct of its
business or to the ownership, lease or operation of its properties and
assets.
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(b) The execution
of this Agreement and all related agreements and the delivery hereof and thereof
to the Lender have been duly authorized by the Borrower’s Board of
Directors.
(c) Subject to
any consents required under Section 3.7 below, the Borrower has the full legal
right, power and authority to execute, deliver and carry out the terms and
provisions of this Agreement; and this Agreement has been duly and validly
executed and delivered on behalf of the Borrower and constitutes a valid and
binding obligation of the Borrower enforceable in accordance with its
terms.
(d) Except as set
forth in Schedule 3.2, neither the execution and delivery of this Agreement, the
consummation of the transactions herein contemplated, nor compliance with the
terms of this Agreement will violate, conflict with, result in a breach of, or
constitute a default under any statute, regulation, indenture, mortgage, loan
agreement, or other agreement or instrument to which the Borrower is a party or
by which it or any of them is bound, any charter, regulation, or bylaw provision
of Borrower, or any decree, order, or rule of any court or governmental
authority or arbitrator that is binding on Borrower in any way.
3.3 Subsidiaries and
Affiliates. Any and all businesses, entities, enterprises and
organizations in which Borrower has any ownership, voting or profit and loss
sharing percentage interest (the “Subsidiaries”) are identified in Section 3.3
hereto, together with the Borrower’s interest therein. Unless the
context requires otherwise or specifically designated to the contrary on Section
3.3 hereto, “Borrower” as used in this Agreement shall include all such
Subsidiaries.
3.4 Consents. Except
as set forth in Schedule 3.4, no consents or approvals of any public body or
authority and no consents or waivers from other parties to leases, licenses,
franchises, permits, indentures, agreements or other instruments are
(i) required for the lawful consummation of the transactions contemplated
hereby. The consummation of the transactions contemplated hereby will
not result in creating, accelerating or increasing any liability of
Borrower.
3.5 Machinery and
Equipment. Except for items disposed of in the ordinary course
of business, all machinery, tools, furniture, fixtures, equipment, vehicles,
leasehold improvements and all other tangible personal property (hereinafter
“Fixed Assets”) of the Borrower currently being used in the conduct of its
business, together with any machinery or equipment that is leased or operated by
the Company, are in fully serviceable working condition and
repair. Except as described on Schedule 3.5 hereto, all Fixed
Assets owned, used or held by the Borrower are situated at its business premises
and are currently used in its business. Schedule 3.5 describes all
Fixed Assets owned by or an interest in which is claimed by any other person
(whether a customer, supplier or other person) for which the Borrower is
responsible (copies of all agreements relating thereto being attached to said
Schedule 3.5), and all such property is in the Borrower’s actual possession and
is in such condition that upon the return of such property in its present
condition to its owner, the Borrower will not be liable in any amount to such
owner. There are no outstanding requirements or recommendations of
any insurance company that has issued a policy covering either (i) such
Fixed Assets or (ii) any liabilities of the Borrower relating to operation
of their business, or by any board of fire underwriters or other body exercising
similar functions, requiring or recommending any repairs or work to be done on
any Fixed Assets or any changes in the operations of the business, any equipment
or machinery used therein, or any procedures relating to such operations,
equipment or machinery.
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3.6 Title to Properties; Certain
Real Property Matters.
(a) Except as set
forth in Schedule 3.6, the Borrower each have good and marketable title to all
the real properties used in their respective operations and each is the owner of
all other assets used in their respective operations including, without
limitation, those shown on the Basic Warranty Date Balance Sheet
(except as to those since sold or otherwise disposed of in the ordinary course
of business), free and clear of all liens, pledges, encumbrances, security
interests, exceptions to title or any other charges or restrictions or title
retention agreements of any kind or character whatsoever (whether of record or
inchoate). The Borrower has delivered to the Lender customary and
standard reports on the Uniform Commercial Code filing status of the Borrower
with respect to state, county and local filings.
(b) The real
property and improvements thereon owned or leased by the Borrower (the “Real
Properties”), all of which are described on Schedule 3.6, and their respective
operations, do not violate or contravene any planning or zoning ordinance or
other administrative regulations or any restrictive covenant or any provision of
local law in effect or any other law, ordinance, executive order or judicial
decree, whether pertaining to pollution of the earth, water, atmosphere or
otherwise, that in any material respect interferes with or prevents the
continued use of the Real Properties for the purposes for which they are now
being used or which would materially affect the value thereof or the ability to
transfer the same under state or federal laws or regulations.
(c) Borrower has
not received any notice of alleged violation of any applicable planning or
zoning regulations, ordinance or other law, order, regulation or other
requirement relating to their respective operations or properties including,
without limitation of the foregoing, any pertaining to occupational safety and
health or pollution of the earth, water or atmosphere.
(d) Each Real
Property includes all right, title and interest in and to strips, gores,
easements, rights of way, privileges, appurtenances, land lying in the bed of
any street, road or avenue, opened or proposed, in front of or adjoining such
Real Property or any part thereof by reason of change or grade or closing of any
street, road, highway or avenue, and all rights belonging to and inuring to the
benefit of such Real Property.
(e) Except as set
forth on Schedule 3.6, the buildings, driveways, and all other structures and
improvements upon each Real Property are all within the boundary lines of such
Real Property or have the benefit of valid easements and there are no
encroachments thereon. There are no outstanding requirements or
recommendations by any insurance company that has issued a policy covering any
Real Property, or by any board of fire underwriters or other body exercising
similar functions, requiring or recommending any repairs or work to be done on
any Real Property.
(f) All public
utilities required for the operation of the Real Properties either enter the
Real Properties through adjoining public streets or, if they pass through
adjoining private land, do so in accordance with valid public or private
easements. All of the public utilities mentioned above are installed
and operating, and all installation and connection charges, are paid in
full.
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(g) On the date
hereof there are no governmental assessments against any of the Real Properties
proposed, pending or constituting a lien on or against any of the Real
Properties for which the Company would be responsible, which assessments have
not been paid in full.
(h) All real
estate taxes related to the Borrower’ lease of the Real Properties are paid by
the owner(s) of such Real Properties.
3.7 Leases. All
leases of real and personal property of the Borrower are described in Schedule
3.7, are in full force and effect and constitute legal, valid and binding
obligations of the respective parties thereto enforceable in accordance with
their terms, except as limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws relating to or affecting generally the enforcement of
creditor’s rights, and have not been assigned or encumbered. The
Borrower has performed in all material respects the obligations required to be
performed by it under all such leases to date and it is not in default in any
material respect under any of said leases, except as set forth in Schedule 3.7,
nor has it made any leasehold improvements required to be removed at the
termination of any lease, except signs. No other party to any such
lease is in material default thereunder.
3.8 Insurance
Policies. The Borrower does not currently maintain
insurance. Within twenty (20) days of the initial distribution of
funds to the Borrower and through the Maturity Date, the Borrower will obtain
such insurance coverage as reasonably required and as approved by the Lender and
such insurance coverage will be maintained in full force and effect and will not
be cancelled, modified or changed without the express written consent of the
Lender, except to the extent the maturity dates of any such insurance policies
expiring prior to the Maturity Date.
3.9 Banking. The
Borrower has delivered to the Lender the name of each bank in which the Borrower
have an account, the account numbers and description and the names of all
persons authorized to draw thereon or have access thereto.
3.10 Lists of Contracts,
Etc. There is included in Schedule 3.10 a list of the
following items (whether written or oral) relating to the Borrower, which list
identifies and fairly summarizes each item:
(i) All
collective bargaining and other labor union agreements (if any); all employment
agreements with any officer, director, employee or consultant; and all employee
pension, health and welfare benefit plans, group insurance, bonus, profit
sharing, severance, vacation, hospitalization, and retirement plans,
post-retirement medical benefit plans, and any other plans, arrangements or
custom requiring payments or benefits to current or retiring
employees.
(ii) All joint venture
contracts of the Borrower
(iii) All contracts of
the Borrower relating to (a) obligations for borrowed money,
(b) obligations evidenced by bonds, debentures, notes or other similar
instruments, (c) obligations to pay the deferred purchase price of property
or services, except trade accounts payable arising in the ordinary course of
business, (d) obligations under capital leases, (e) debt of others
secured by a lien on any asset of the Borrower, and (f) debts of others
guaranteed by the Borrower.
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(iv) All
agreements of the Borrower relating to the supply of raw materials for and the
distribution of the products of the Borrower, including without limitation all
sales agreements, manufacturer’s representative agreements and distribution
agreements of whatever magnitude and nature, and any commitments
therefor;
(v) All contracts
that individually provide for aggregate future payments to or from the Borrower
of $25,000 or more, to the extent not included in (i) through (iv)
above;
(vi) All other contracts
of the Borrower material to the business, assets, liabilities, financial
condition, results of operations or prospects of the business of the Borrower
taken as a whole to the extent not included above.
Except as
set forth in Schedule 3.10, (i) all contracts, agreements and commitments
of the Borrower set forth in Schedule 3.10 are valid, binding and in full force
and effect, and (ii) neither the Borrower nor any other party to any such
contract, agreement, or commitment has materially breached any provision thereof
or is in default thereunder. True and complete copies of the
contracts, leases, licenses and other documents referred to in this Schedule
3.10 have been delivered to the Lender, certified by the Secretary or Assistant
Secretary of Borrower as true, correct and complete copies.
3.11 Compliance With the
Law.
(a) Except as set
forth on Schedule 3.11 or except where any failure to comply or any
violation would not have a Material Adverse Effect on the Borrower:
(i) the Borrower
is in material compliance with each any federal, state, local, municipal,
foreign, international, multinational, or other administrative order,
constitution, law, ordinance, principle of common law, court order, consent,
decree, regulation, license, permit, statute, or treaty (“Legal Requirement”),
that is or was applicable to it or to the conduct or operation of its business
or the ownership or use of any of its assets;
(ii) no event has
occurred or circumstance exists that (with or without notice or lapse of time)
may constitute or result in a material violation by Borrower of, or a material
failure on the part of either Borrower to comply with, any Legal Requirement;
and
(iii) to Borrower’s
knowledge, it has not received any written notice or communication from any
court, administrative agency, commission, governmental or regulatory authority,
domestic or foreign (each a “Governmental Body”),
regarding: (A) any actual or alleged violation of, or failure to
comply with, any Legal Requirement, or (B) any actual or alleged obligation
on the part of such Borrower to undertake, or to bear all or any portion of the
cost of, any remedial action of any nature.
(b) Schedule 3.10
contains a list that is complete and accurate in all material respects of all
Governmental Authorizations which are material to operation of the business of
the Borrower or that otherwise relates to the business of, or to any of the
assets owned or used by, the Borrower. The Borrower holds all
Governmental Authorizations necessary to conduct the business as presently
conducted without any material violation of any Legal Requirement. To
the knowledge of the Borrower, each Governmental Authorization listed on
Schedule 3.15 is valid and in full force and effect. To the
knowledge of the Borrower, and except as set forth on Schedule 3.15, or
except where any failure to comply, violation or other event or circumstances
would not have a Material Adverse Effect on the Borrower:
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(i) the
Borrower is in compliance with all of the terms and requirements of each
Governmental Authorization identified or required to be identified on
Schedule 3.10;
(ii) no event has
occurred or circumstance exists that may (with or without notice or lapse of
time): (A) constitute or result directly or indirectly in a violation
of or a failure to comply with any term or requirement of any Governmental
Authorization listed on Schedule 3.10, or (B) result directly or indirectly
in the revocation, withdrawal, suspension, cancellation, modification, or
termination of, any material Governmental Authorization listed on
Schedule 3.10;
(iii) the Borrower has
not received any written notice or communication from any Governmental Body
regarding: (A) any actual, alleged or potential violation of or
failure to comply with any term or requirement of any Governmental
Authorization, or (B) any actual or threatened revocation, withdrawal,
suspension, cancellation, modification or termination of any material
Governmental Authorization; and
(iv) all applications
required to have been filed for the renewal of any material Governmental
Authorizations listed or required to be listed on Schedule 3.10 have been
duly filed on a timely basis with the appropriate Governmental Bodies, and all
other filings required to have been made with respect to such Governmental
Authorizations have been duly made on a timely basis with the appropriate
Governmental Bodies.
For the
purposes hereof, Governmental Authorization means any approval, consent,
license, permit, certification, registration, waiver, or other authorization
issued, granted, given, required, or otherwise made available by or under the
authority of any:
(a) nation,
state, county, city, town, village, district, or other jurisdiction of any
nature;
(b) federal,
state, local, county, municipal, foreign, or other government;
(c) governmental
or quasi-governmental authority of any nature (including any governmental
agency, branch, department, official, or entity and any court or other
tribunal); or
(d) body
exercising, or entitled to exercise, any administrative, executive, judicial,
legislative, police, regulatory, or taxing authority or power of any
nature.
3.11 Litigation; Pending Labor
Disputes. Except as specifically identified in Schedule
3.11:
(i) There are no
legal, administrative, arbitration or other proceedings or governmental
investigations pending or, to the knowledge of the Borrower, threatened, against
the Borrower, relating to the Borrower or its properties (including leased
property), or the transactions contemplated by this Agreement, nor is there any
basis known to the Borrower for any such action.
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(ii) There are no
judgments, decrees or orders of any court, or any governmental department,
commission, board, agency or instrumentality binding upon the Borrower relating
to the business of the Borrower the effect of which is to prohibit any business
practice or the acquisition of any property or the conduct of any business by
the Borrower or which limit or control or otherwise adversely affect its method
or manner of doing business.
(iii) No work stoppage
has occurred and is continuing or, to the knowledge of the Borrower, is
threatened affecting the business of the Borrower, and no representation
question involving recognition of a collective bargaining agent exists in
respect of any employees of the Borrower.
(iv) There are no
pending labor negotiations or union organization efforts relating to employees
of the Borrower.
(v) There are no
charges of discrimination (relating to sex, age, race, national origin, handicap
or veteran status) or unfair labor practices pending or, to the knowledge of the
Borrower, threatened before any governmental or regulatory agency or authority
or any court relating to employees of the Borrower.
3.12 Assets. The
assets of the Borrower are located at the locations listed on Schedule 3.12
attached hereto. Except as described in Schedule 3.12, the assets of the
Borrower are sufficient in all material respects to carry on the operations of
the Borrower business as now conducted by the Borrower.
3.13 Absence of Certain
Commercial Practices. The Borrower has not made any payment
(directly or by secret commissions, discounts, compensation or other payments)
or given any gifts to another business concern, to an agent or employee of
another business concern or of any governmental entity (domestic or foreign) or
to a political party or candidate for political office (domestic or foreign), to
obtain or retain business for the Borrower or to receive favorable or
preferential treatment, except for gifts and entertainment given to
representatives of customers or potential customers of sufficiently limited
value and in a form (other than cash) that would not be construed as a bribe or
payoff.
3.14 Licenses, Permits, Consents
and Approvals. The
Borrower has all licenses, permits or other authorizations of governmental,
regulatory or administrative agencies or authorities (collectively, “Licenses”)
required to conduct the business of the Borrower.
3.15 Environmental
Matters.
(a) Except as set
forth on Schedule 3.15(a) and except to the extent that the inaccuracy of
any of the following, individually or in the aggregate, would not have a
Material Adverse Effect on the Borrower:
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(i) the Borrower
holds and is in compliance with all Environmental Permits, and are and have
otherwise been in compliance with all applicable Environmental Laws and there is
no condition that is reasonably likely to prevent or materially interfere with
compliance by the Borrower with Environmental Laws;
(ii) no
modification, revocation, re-issuance, alteration, transfer or amendment of any
Environmental Permit, or review by, or approval of, any third party, including,
without limitation, any Governmental Body, of any Environmental Permit or of the
environmental condition any real property owned by the Borrower or any of their
subsidiaries is required in connection with the execution or delivery of this
Agreement or the consummation by the Borrower of the transactions contemplated
hereby or the operation of the business of the Borrower on the date of the
Closing;
(iii) the Borrower
has not received any Environmental Claim, nor, to the knowledge of the Borrower,
has any Environmental Claim been threatened against either of the Borrower;
and
(iv) the Borrower
has not entered into or agreed to any outstanding judgment, decree, order or
consent arrangement with any Governmental Body under any Environmental Laws,
including without limitation those relating to compliance with any Environmental
Laws or to the investigation, cleanup, remediation or removal of Hazardous
Materials.
(b) Set forth on
Schedule 3.15(b) are all of the parcels of real property that are now, or
have heretofore been, owned or leased by the Borrower or their subsidiaries, or
otherwise used by the Borrower or their subsidiaries for the conduct of the
Borrower’s business (each, a “Borrower Facility”), or to
which any Hazardous Materials generated by the Borrower or its Subsidiaries have
been delivered during the last 10 years by a third party.
(c) Except as set
forth on Schedule 3.15(c), except for Hazardous Materials which are
required for the conduct of the business of the Borrower or any of their
subsidiaries as currently conducted and which are being stored and disposed of
by the Borrower or any of their Subsidiaries in accordance with applicable
Environmental Laws, no Hazardous Materials have been Released at or onto or, to
the knowledge of the Borrower or their Subsidiaries, are migrating onto or from
any Borrower Facility currently leased or owned by either Borrower or any
subsidiary (a “Current Borrower Facility”) (including, without limitation, the
soil, groundwater, surface water, or ambient air, or building materials
thereof). Except as set forth on Schedule 3.21(c), no Hazardous
Materials were Released at or onto, and, to the knowledge of the Borrower, no
Hazardous Materials migrated onto or from, any Borrower Facility previously
leased or owned by the Borrower or any subsidiary (a “Former Borrower Facility”)
during the ownership or leasing by the Borrower or any subsidiary of such Former
Borrower Facility. Except as set forth on Schedule 3.15(c),
except for Hazardous Materials used, generated, stored and Released in
accordance with applicable Environmental Laws, to the knowledge of the Borrower,
no Hazardous Material which was generated, discarded, transported, or Released
by the Borrower or their subsidiaries prior to the date hereof is present, in a
concentration or amount exceeding legally allowable limits applicable to the use
of the property in question or in a manner which violates any
applicable Environmental Law or that is reasonably likely to require any
investigation, removal or response activity under any applicable Environmental
Law, on any other real property, including, without limitation any disposal site
to which Hazardous Materials generated or transported by the Borrower has been
delivered.
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(d) The Borrower
has delivered to Lender (or made available for Lender’s inspection) all reports,
records, tests, evaluations, Governmental Body and third party correspondence,
and other documents relating to the storage, use, Release, manufacture,
remediation, investigation, or removal of Hazardous Materials by the Borrower or
any of their subsidiaries or the presence of any Hazardous Material on or about
any Borrower Facility.
(e) Except as set
forth on Schedule 3.15(e), no person has been exposed to any Hazardous
Material stored, used, Released, generated, or transported by or for the
Borrower or any of their subsidiaries in a manner which has caused, or is
reasonably likely to cause, an adverse health effect.
For
purposes of this Agreement, the terms below shall have the following
meanings:
“Environmental Claim” means any
written complaint, notice, claim, demand, action, suit or judicial,
administrative or arbitral proceeding by any Person to the Company asserting
liability or potential liability (including without limitation, liability or
potential liability for investigatory costs, cleanup costs, governmental
response costs, natural resource damages, property damage, personal injury,
fines or penalties) arising out of, relating to, based on or resulting from:
(i) the presence, Release or threatened Release of any Hazardous Materials
at any location, (ii) circumstances forming the basis of any violation or
alleged violation of any Environmental Laws or Environmental Permits, or
(iii) otherwise relating to obligations or liabilities under any
Environmental Law.
“Environmental Laws” means all
applicable federal, state, county, and local statutes, rules, regulations,
ordinances, orders and decrees, and all common law, in each case relating in any
manner to pollution, protection of human health and the environment, the
exposure of Persons, property or the environment to any Hazardous Materials, or
the Release or threatened Release of any Hazardous Materials, to the extent and
in the form that such exist at the date hereof.
“Environmental Permits” means
all permits, licenses, registrations, exemptions and other governmental
authorizations required under Environmental Laws for either Borrower to conduct
its operations as presently conducted.
“Hazardous Materials” means all
hazardous or toxic substances, wastes, materials or chemicals, petroleum and
petroleum products, asbestos and asbestos-containing materials, pollutants,
contaminants and all other materials and substances, including but not limited
to radiologically-contaminated materials regulated pursuant to any Environmental
Laws or that could result in liability under any Environmental
Laws.
“Release” means any spilling,
leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping,
leaching, dumping, or disposing into the environment (including but not limited
to any ventilated or indoor air) or into any building or other man-made
structure.
“Released” means spilled,
leaked, pumped, poured, emitted, emptied, discharged, injected, allowed to
escape, allowed to xxxxx, dumped, or disposed of into the
environment (including but not limited to any ventilated or indoor
air) or into any building or other man-made structure.
11
3.16 Disclosure. All
statements contained in any schedule, certificate, opinion, instrument, or other
document delivered by or on behalf of the Borrower pursuant hereto or in
connection with the transactions contemplated hereby shall be deemed
representations and warranties by the Borrower herein. No statement,
representation or warranty by the Borrower in this Agreement or in any schedule,
certificate, opinion, instrument, or other document furnished or to be furnished
to the Lender pursuant hereto or in connection with the transactions
contemplated hereby contains or will contain any untrue statement of a material
fact or omits or will omit to state a material fact required to be stated
therein or necessary to make the statements contained therein not misleading or
necessary in order to provide a prospective purchaser of the business of the
Borrower with full and fair disclosure concerning the Borrower, its business,
and the Borrower’s affairs.
3.23 Covenants:
(a) Use of
Proceeds.
All
proceeds of all Loans will be used solely for lawful business
purposes.
(b) Maintenance
of Collateral, Etc.
The
Borrower will maintain all of its equipment in good working condition, ordinary
wear and tear excepted.
(c) Further
Assurances.
The
Borrower agrees, at its expense, to take all actions, and execute or cause to be
executed and delivered to Lender all promissory notes, security agreements,
agreements with landlords, mortgagees and processors and other bailees,
subordination and intercreditor agreements and other agreements, instruments and
documents, as Lender may request from time to time to perfect and maintain
Lender's security interests in the mortgaged properties and to fully carry out
the transactions contemplated by this Agreement.
(d) Negative
Covenants.
Except as
set forth in herein, no Borrower will, without Lender's prior written consent,
(i) merge or consolidate with another Person, form any new subsidiary or
acquire any interest in any Person; (ii) acquire any assets except in the
ordinary course of business and as otherwise permitted by this Agreement;
(iii) enter into any transaction outside the ordinary course of business;
(iv) make any loans to, or investments in, any affiliate or other Person in
the form of money or other assets; (v) incur any debt outside the ordinary
course of business; (vi) guaranty or otherwise become liable with respect
to the obligations of another party or entity; (vii) pay or declare any
dividends or other distributions on any Borrower's stock, if such Borrower is a
corporation (except for dividends payable solely in capital stock of such
Borrower); (viii) redeem, retire, purchase or otherwise acquire, directly
or indirectly, any of any Borrower's capital stock or other equity interests;
(ix) make any change in any Borrower's capital structure; (x) dissolve
or elect to dissolve; (xi) enter into any transaction with an Affiliate
other than on arms-length terms disclosed to Lender in writing; (xii) agree
to do any of the foregoing.
12
4. RELEASE
AND INDEMNITY.
4.1. Release.
Borrower
hereby release Lender and its Affiliates and their respective directors,
officers, employees, attorneys and agents and any other Person affiliated with
or representing Lender (the "Released Parties") from any and all liability
arising from acts or omissions under or pursuant to this Agreement, whether
based on errors of judgment or mistake of law or fact, except for those arising
from gross negligence or willful misconduct. However, in no
circumstance will any of the Released Parties be liable for lost profits or
other special or consequential damages. Such release is made on the
date hereof and remade upon each request for a Term Loan by the
Borrower. Without limiting the foregoing:
4.2. Indemnity.
The
Borrower hereby agrees to indemnify the Released Parties and hold them harmless
from and against any and all claims, debts, liabilities, demands, obligations,
actions, causes of action, penalties, costs and expenses (including attorneys'
fees), of every nature, character and description, which the Released Parties
may sustain or incur based upon or arising out of any of the transactions
contemplated by this Agreement, or any other matter, cause or thing whatsoever
occurred, done, omitted or suffered to be done by Lender relating to Borrower or
their obligations hereunder (except any such amounts sustained or incurred as
the result of the gross negligence or willful misconduct of the Released
Parties). Notwithstanding any provision in this Agreement to the
contrary, the indemnity agreement set forth in this Section shall survive any
termination of this Agreement.
5. TERM.
5.1. Maturity
Date.
Lender's
obligation to make Term Loans shall initially continue in effect for a term from
the date of this Agreement until the Maturity Date. This
Agreement and related agreement and documents and Lender's security
interests pursuant to the Mortgages, and all representations, warranties and
covenants of Borrower contained herein and therein, shall remain in full force
and effect after the Maturity Date until all of the monetary obligations are
indefeasibly paid in full.
5.2. Early
Termination.
Lender's
obligation to make Loans under this Agreement may be terminated prior to the
Maturity Date as follows: (i) by Borrower, upon notice of
termination and repayment of all outstanding obligations due to Lender
hereunder; or (ii) by Lender at any time after the occurrence of an Event
of Default, without notice, effective immediately.
13
5.3. Payment of
Obligations.
On the
Maturity Date or on any earlier effective date of termination, Borrower shall
pay in full all obligations due to the Lender hereunder, whether or not all or
any part of such obligations are otherwise then due and payable.
5.4. Effect of
Termination.
No
termination shall affect or impair any right or remedy of Lender or relieve
Borrower of any of the obligations until all of the monetary obligations have
been indefeasibly paid in full. Upon indefeasible payment and
performance in full of all of the monetary obligations and termination of this
Agreement, Lender shall promptly deliver to Borrower termination statements,
requests for reconveyances and such other documents as may be reasonably
required to terminate Lender's security interests in properties of the
Borrower.
6. EVENTS
OF DEFAULT AND REMEDIES.
6.1. Events of
Default.
The
occurrence of any of the following events shall constitute an "Event of Default" under this
Agreement, and Borrower shall give Lender immediate written notice
thereof: (i) if any warranty, representation, statement, report
or certificate made or delivered to Lender by Borrower or any of Borrower's
officers, employees or agents is untrue or misleading; (ii) if Borrower
fails to pay when due any principal or interest on any Term Loan or any other
monetary obligation; (iii) if Borrower breaches any covenant or obligation
contained in this Agreement or any related document or agreement or fails to
perform any other non-monetary obligation; (iv) if any levy, assessment,
attachment, seizure, lien, security interest or encumbrance (other than a
Permitted Lien) is made or permitted to exist on all or any part of the
Collateral; (v) if one or more judgments aggregating in excess of $150,000,
or any injunction or attachment, is obtained against Borrower which remains
unstayed for more than ten days or is enforced; (vi) the occurrence of any
default under any financing agreement, security agreement or other agreement,
instrument or document executed and delivered by any Borrower with, or
in favor of, any Person other than Lender; (vii) the dissolution,
death, termination of existence in good standing, insolvency or business failure
or suspension or cessation of business as usual of Borrower or the appointment
of a receiver, trustee or custodian for all or any part of the property of, or
an assignment for the benefit of creditors by any Borrower, or the commencement
of any proceeding by any Borrower under any reorganization, bankruptcy,
insolvency, arrangement, readjustment of debt, dissolution or liquidation law or
statute of any jurisdiction, now or in the future in effect, or if any Borrower
makes or sends a notice of a bulk transfer or calls a meeting of its creditors;
(viii) the commencement of any proceeding against Borrower under any
reorganization, bankruptcy, insolvency, arrangement, readjustment of debt,
dissolution or liquidation law or statute of any jurisdiction, now or in the
future in effect; (ix) the actual or attempted revocation or termination
of, or limitation or denial of liability upon, any guaranty of the Obligations,
or any security document securing the Obligations, by any Obligor; or
(x) if there is any actual or threatened indictment of any Borrower or any
officer or director of any Borrower under any criminal statute
or commencement or threatened commencement of criminal or civil proceedings
against Borrower.
14
6.2. Remedies.
Upon the
occurrence of any Default, and at any time thereafter, Lender, at its option,
may cease making Loans or otherwise extending credit to Borrower under this
Agreement or any other Loan Document. Upon the occurrence of an Event
of Default, Lender may exercise from time to time any rights and remedies
available to it under the UCC and any other applicable law in addition to, and
not in lieu of, any rights and remedies expressly granted in this Agreement or
in any of the other Loan Documents and all of Lender's rights and remedies shall
be cumulative and non-exclusive to the extent permitted by law. In
particular, but not by way of limitation of the foregoing, upon the occurrence
of any Event of Default, and at any time thereafter, Lender, at its option, and
without notice or demand of any kind (all of which are hereby expressly waived
by Borrower), may do any one or more of the following: (i) cease
making Loans or otherwise extending credit to Borrower under this Agreement or
any other Loan Document; (ii) accelerate and declare all or any part of the
Obligations to be immediately due, payable and performable, notwithstanding any
deferred or installment payments allowed by any instrument evidencing or
relating to any of the Obligations; (iii) take possession of any or all of
the Collateral (in addition to Collateral of which it already has possession)
wherever it may be found, and for that purpose Borrower hereby authorizes
Lender, without judicial process, to enter onto any of such Borrower's premises
without interference to search for, take possession of, keep, store, or remove
any of the Collateral, and remain (or cause a custodian to remain) on the
premises in exclusive control thereof, without charge for so long as Lender
deems it reasonably necessary in order to complete the enforcement of its rights
under this Agreement or any other agreement; provided, that if Lender
seeks to take possession of any of the Collateral by court process, Borrower
hereby irrevocably waives (A) any bond and any surety or security relating
thereto required by law as an incident to such possession, (B) any demand
for possession prior to the commencement of any suit or action to recover
possession thereof and (C) any requirement that Lender retain possession
of, and not dispose of, any such Collateral until after trial or final judgment;
(iv) require Borrower to assemble any or all of the Collateral and make it
available to Lender at one or more places designated by Lender which are
reasonably convenient to Lender and Borrower, and to remove the Collateral to
such locations as Lender may deem advisable; (v) complete the processing,
manufacturing or repair of any Collateral prior to a disposition thereof and,
for such purpose and for the purpose of removal, Lender shall have the right to
use Borrower's premises, vehicles and other Equipment and all other property
without charge; (vi) sell, lease or otherwise dispose of any of the
Collateral, in its condition at the time Lender obtains possession of it or
after further manufacturing, processing or repair, at one or more public or
private sales, in lots or in bulk, for cash, exchange or other property, or on
credit (a "Sale"),
and to adjourn any such Sale from time to time without notice other than oral
announcement at the time scheduled for Sale (and, in connection therewith,
(A) Lender shall have the right to conduct such Sale on any Borrower's
premises without charge, for such times as Lender deems reasonable, on Lender's
premises, or elsewhere, and the Collateral need not be located at the place of
Sale; (B) Lender may directly or through any of its Affiliates purchase or
lease any of the Collateral at any such public disposition, and if permissible
under applicable law, at any private disposition and (C) any Sale of
Collateral shall not relieve Borrower of any liability Borrower may have if any
Collateral is defective as to title, physical condition or otherwise at the time
of sale); (vii) demand payment of and collect any Accounts, Chattel Paper,
Instruments and General Intangibles included in the Collateral and, in
connection therewith, each Borrower irrevocably authorizes Lender to endorse or
sign such Borrower's name on all collections, receipts, Instruments and other
documents, to take possession of and open mail addressed to such Borrower and
remove therefrom payments made with respect to any item of Collateral or
Proceeds thereof and, in Lender's sole discretion, to grant extensions of time
to pay, compromise claims and settle Accounts, General Intangibles and the like
for less than face value; and (viii) demand and receive possession of any
of any Borrower's federal and state income tax returns and the books and records
utilized in the preparation thereof or relating thereto. Borrower
recognizes that if Borrower fails to perform, observe or discharge any of its
Obligations under this Agreement or any of the Loan Documents, no remedy at law
will provide adequate relief to Lender, and agree that Lender shall be entitled
to temporary and permanent injunctive relief in any such case without the
necessity of proving actual damages. Any notification of intended
disposition of any of the Collateral required by law will be deemed to be a
reasonable authenticated notification of disposition if given at least ten days
prior to such disposition and such notice shall (i) describe Lender and the
applicable Borrower(s), (ii) describe the Collateral that is the subject of
the intended disposition, (iii) state the method of the intended
disposition, (iv) state that the applicable Borrower is entitled to an
accounting of the Obligations and state the charge, if any, for an accounting
and (v) state the time and place of any public disposition or the time
after which any private sale is to be made. Lender may disclaim any
warranties that might arise in connection with the sale, lease or other
disposition of the Collateral and has no obligation to provide any warranties at
such time. Any Proceeds of any disposition by Lender of any of the
Collateral may be applied by Lender to the payment of expenses in connection
with the Collateral, including legal expenses and reasonable attorneys' fees,
and any balance of such Proceeds may be applied by Lender toward the payment of
such of the Obligations, and in such order of application, as Lender may from
time to time elect. Exercise or partial exercise by Lender of one or
more of its rights or remedies shall not be deemed an election or bar Lender
from subsequent exercise or partial exercise of any other rights or
remedies. The failure or delay of Lender to exercise any rights or
remedies shall not operate as a waiver thereof, but all rights and remedies
shall continue in full force and effect until all of the Obligations have been
fully paid and performed.
15
7. GENERAL
PROVISIONS.
7.1. Notices.
All
notices to be given under this Agreement shall be in writing and shall be given
either personally, by reputable private delivery service, by regular first-class
mail or certified mail return receipt requested, addressed to Lender or Borrower
at the address shown below, or by facsimile to the facsimile number shown below
or at any other address (or to any other facsimile number) designated in writing
by one party to the other party in the manner prescribed in this
Section 7.1. All notices shall be deemed to have been given when
received or when delivery is refused by the recipient.
(a) Lender:
Phoenix
Investors, LLC
0000
Xxxxx Xxxxxxx Xxx.
Xxxxxxxxx,
XX 00000
Attn:
Xxxxx Xxxxx
Phone: (000)
000-0000
(b) Borrower:
Renewal
Plantations, LLC
0000
Xxxxx Xxxxxxx Xxx.
Xxxxxxxxx,
XX 00000
Attn: Xxxxx
Chance
Phone: (000)
000-0000
Copy
to:
Xxxxxx X.
Xxxx, Esq.
Sichenzia
Xxxx Xxxxxxxx Xxxxxxx LLP
00
Xxxxxxxx
Xxx Xxxx,
Xxx Xxxx 00000
Phone: (000)
000-0000
Facsimile:
(000) 000-0000
7.2. Severability.
If any
provision of this Agreement, or the application thereof to any party or
circumstance, is held to be void or unenforceable by any court of competent
jurisdiction, such defect shall not affect the remainder of this Agreement,
which shall continue in full force and effect.
16
7.3. Integration.
This
Agreement and the other Loan Documents represent the final, entire and complete
agreement among Borrower and Lender and supersede all prior and contemporaneous
negotiations, oral representations and agreements, all of which are merged and
integrated into this Agreement. THERE ARE NO ORAL
UNDERSTANDINGS, REPRESENTATIONS OR AGREEMENTS BETWEEN THE PARTIES THAT ARE
NOT SET FORTH IN THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS.
7.4. Waivers.
The
failure of Lender at any time or times to require Borrower to strictly comply
with any of the provisions of this Agreement or any other Loan Documents shall
not waive or diminish any right of Lender later to demand and receive strict
compliance therewith. Any waiver of any default shall not waive or
affect any other default, whether prior or subsequent, and whether or not
similar. None of the provisions of this Agreement or any other loan
document shall be deemed to have been waived by any act or knowledge of Lender
or its agents or employees, but only by a specific written waiver signed by an
authorized officer of Lender and delivered to Borrower.
7.5. Amendment.
This
Agreement may not be amended or modified except in a writing executed by
Borrower and a duly authorized officer of Lender.
7.6. Time of
Essence.
Time is
of the essence in the performance by Borrower of each and every obligation under
this Agreement and the other Loan Documents.
7.7. Benefit of Agreement;
Assignability.
The
provisions of this Agreement shall be binding upon and inure to the benefit of
the respective successors, assigns, heirs, beneficiaries and representatives of
Borrower and Lender; provided, that Borrower may
not assign or transfer any of its rights under this Agreement without the prior
written consent of Lender, and any prohibited assignment shall be
void. No consent by Lender to any assignment shall release Borrower
from its liability for any of the obligations. Lender shall have the
right to assign all or any of its rights and obligations under this Agreement
and any related document or agreement, to one or more other Persons, and
Borrower agrees to execute all agreements, instruments and documents requested
by Lender in connection with each such assignment and
participation.
7.8. Headings;
Construction.
Section
and subsection headings are used in this Agreement only for convenience and do
not affect the meanings of the provisions that they precede.
17
7.9. Governing law; Consent to Forum,
etc.
THIS
AGREEMENT HAS BEEN NEGOTIATED, EXECUTED AND DELIVERED, AND SHALL BE DEEMED TO
HAVE BEEN MADE, IN MILWAUKEE WISCONSIN SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF WISCONSIN. THE
BORROWER HEREBY CONSENTS AND AGREES THAT THE STATE AND FEDERAL COURTS LOCATED IN
[ ] COUNTY, WISCONSINOR ANY STATE IN
WHICH ANY OF THE COLLATERAL IS LOCATED SHALL HAVE NON-EXCLUSIVE JURISDICTION TO
HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN BORROWER AND LENDER
PERTAINING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENTS OR ANY MATTER
ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE OTHER LOAN
DOCUMENTS. EACH BORROWER EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO
SUCH JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN ANY SUCH COURT, AND
WAIVES ANY OBJECTION WHICH SUCH BORROWER MAY HAVE BASED UPON LACK OF PERSONAL
JURISDICTION, IMPROPER VENUE OR FORUM NON CONVENIENS. EACH
BORROWER ALSO AGREES THAT ANY CLAIM OR DISPUTE BROUGHT BY SUCH BORROWER AGAINST
LENDER PURSUANT TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR ANY MATTER ARISING
OUT OF THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT SHALL BE BROUGHT EXCLUSIVELY IN
THE STATE AND FEDERAL COURTS LOCATED IN
[ ] COUNTY, WISCONSIN. EACH
BORROWER HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS, COMPLAINT AND OTHER
PROCESS ISSUED IN ANY SUCH ACTION OR SUIT AND AGREES THAT SERVICE OF SUCH
SUMMONS, COMPLAINT AND OTHER PROCESS MAY BE MADE IN THE MANNER AND SHALL BE
DEEMED RECEIVED AS SET FORTH IN SECTION 7.1 FOR NOTICES, TO THE EXTENT
PERMITTED BY LAW. NOTHING IN THIS AGREEMENT SHALL BE DEEMED OR
OPERATE TO AFFECT THE RIGHT OF LENDER TO SERVE LEGAL PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW, OR TO PRECLUDE THE ENFORCEMENT BY LENDER OF ANY JUDGMENT OR
ORDER OBTAINED IN SUCH FORUM OR THE TAKING OF ANY ACTION UNDER THIS AGREEMENT TO
ENFORCE THE SAME IN ANY OTHER APPROPRIATE FORUM OR JURISDICTION.
7.10. Waiver of Jury Trial,
etc.
BORROWER
WAIVES (I) THE RIGHT TO TRIAL BY JURY (WHICH LENDER ALSO WAIVES) IN ANY
ACTION, SUIT, PROCEEDING OR COUNTERCLAIM OF ANY KIND ARISING OUT OF OR RELATED
TO ANY OF THE LOAN DOCUMENTS, THE OBLIGATIONS OR THE COLLATERAL OR ANY CONDUCT,
ACTS OR OMISSIONS OF LENDER OR BORROWER OR ANY OF THEIR DIRECTORS, OFFICERS,
EMPLOYEES, ATTORNEYS OR AGENTS OR ANY OTHER PERSONS AFFILIATED WITH LENDER OR
SUCH BORROWER, WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE; (II) THE
RIGHT TO INTERPOSE ANY CLAIMS, DEDUCTIONS, SETOFFS OR COUNTERCLAIMS OF ANY
KIND IN ANY ACTION OR PROCEEDING INSTITUTED BY LENDER WITH RESPECT TO THE LOAN
DOCUMENTS OR ANY MATTER RELATING THERETO, EXCEPT FOR COMPULSORY COUNTERCLAIMS;
(III) NOTICE PRIOR TO LENDER'S TAKING POSSESSION OR CONTROL OF THE
COLLATERAL OR ANY BOND OR SECURITY WHICH MIGHT BE REQUIRED BY ANY COURT PRIOR TO
ALLOWING LENDER TO EXERCISE ANY OF LENDER'S REMEDIES AND (IV) THE BENEFIT
OF ALL VALUATION, APPRAISEMENT AND EXEMPTION LAWS. BORROWER
ACKNOWLEDGES THAT THE FOREGOING WAIVERS ARE A MATERIAL INDUCEMENT TO LENDER'S
ENTERING INTO THIS AGREEMENT AND THAT LENDER IS RELYING UPON THE FOREGOING
WAIVERS IN ITS FUTURE DEALINGS WITH SUCH BORROWER. BORROWER WARRANTS
AND REPRESENTS THAT IT HAS REVIEWED THE FOREGOING WAIVERS WITH ITS LEGAL COUNSEL
AND HAS KNOWINGLY AND VOLUNTARILY WAIVED THEIR JURY TRIAL RIGHTS FOLLOWING
CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF LITIGATION, THIS
AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE
COURT.
18
8. LIABILITY
8.1. Notwithstanding
any provisions of this Agreement to the contrary, it is intended that the joint
and several nature of the obligations of Borrower and the liens and security
interests granted by Borrower to secure the obligations, not constitute a "Fraudulent Conveyance" (as
defined below). Consequently, Lender and Borrower agree that if the
obligations of a Borrower, or any liens or security interests granted by
Borrower securing the obligations would, but for the application of this
sentence, constitute a Fraudulent Conveyance, the obligations of Borrower and
the liens and security interests securing such obligations shall be valid
and enforceable only to the maximum extent that would not cause such obligations
or such lien or security interest to constitute a Fraudulent Conveyance, and the
obligations of Borrower and this Agreement shall automatically be deemed to have
been amended accordingly. For purposes hereof, "Fraudulent
Conveyance" means a fraudulent conveyance under Section 548 of Chapter 11 of
Title II of the Bankruptcy Code or a fraudulent conveyance or fraudulent
transfer under the applicable provisions of any fraudulent conveyance or
fraudulent transfer law or similar law of any state, nation or other
governmental unit, as in effect from time to time.
8.2. Lender is
hereby authorized, without notice or demand and without affecting the liability
of Borrower hereunder, to, at any time and from time to time, (i) renew,
extend, accelerate or otherwise change the time for payment of, or other terms
relating to Borrower's obligations or otherwise modify, amend or
change the terms of any promissory note or other agreement, document or
instrument now or hereafter executed by a Borrower and delivered to Lender;
(ii) accept partial payments on Borrower's obligations; (iii) take and
hold security or collateral for the payment of Borrower's obligations hereunder
or for the payment of any guaranties of Borrower's obligations or other
obligations of a Borrower and exchange, enforce, waive and release any such
security or collateral; and (iv) apply such security or collateral and
direct the order or manner of sale thereof as Lender, in its sole discretion,
may determine. Lender shall have the exclusive right to determine the
time and manner of application of any payments or credits, whether received from
Borrower or any other source, and such determination shall be binding on
Borrower.
[Intentionally
blank]
19
IN
WITNESS WHEREOF, Borrower and Lender have signed this Agreement as of the date
first set forth above.
|
Borrower:
RENEWAL
PLANTATIONS, INC.
By:
/s/ Xxxxx
Chance
Xxxxx
Chance
CEO
|
Lender:
PHONEIX
INVESTORS, LLC
By:
/s/ Xxxxx
Xxxxx
Xxxxx
Xxxxx
Managing
Member
|
20
Schedule A
Definitions
This
Schedule is an integral part of the Loan and Security Agreement among Renewal
Plantations, INC.
and Phoenix Investors, LLC (the
"Agreement").
As used
in the Agreement, the following terms have the following meanings:
"Account"
has the meaning set forth in the UCC.
"Affiliate"
means, with respect to any Person, a relative, partner, shareholder, member,
manager, director, officer, or employee of such Person, any parent or subsidiary
of such Person, or any Person controlling, controlled by or under common control
with such Person or any other Person affiliated, directly or indirectly, by
virtue of family membership, ownership, management or otherwise.
"Agreement"
and "this
Agreement" mean the Loan and Security Agreement of which this
Schedule B is a part and the Schedules thereto.
"Bankruptcy
Code" means the United States Bankruptcy Code (11 U.S.C. § 101 et seq.).
"Chattel
Paper" has the meaning set forth in the UCC.
"Collateral"
means all property and interests in property in or upon which a security
interest or other Lien is granted pursuant to this Agreement or the other Loan
Documents, including all of the property of Borrower described in
Section 3.1.
"Commercial Tort
Claims" has the meaning set forth in the UCC.
"Default"
means any event which with notice or passage of time, or both, would constitute
an Event of Default.
"Document"
has the meaning set forth in the UCC.
"Electronic
Chattel Paper" has the meaning set forth in the UCC.
"Equipment"
has the meaning set forth in the UCC.
"Fixtures"
has the meaning set forth in the UCC.
"General
Intangibles" has the meaning set forth in the UCC.
"Goods" has
the meaning set forth in the UCC.
"Instrument"
has the meaning set forth in the UCC.
Exhibit A
- Page 1
"Inventory"
has the meaning set forth in the UCC.
"Letter-of-Credit
Right" has the meaning set forth in the UCC.
"Lien"
means any interest in property securing an obligation owed to, or a claim by, a
Person other than the owner of the property, whether such interest is based on
common law, statute or contract, including rights of sellers under conditional
sales contracts or title retention agreements and reservations, exceptions,
encroachments, easements, rights-of-way, covenants, conditions, restrictions,
leases and other title exceptions and encumbrances affecting
property. For the purpose of this Agreement, Borrower shall be deemed
to be the owner of any property which it has acquired or holds subject to a
conditional sale agreement or other arrangement pursuant to which title to the
property has been retained by or vested in some other Person for security
purposes.
"Loan
Documents" means, collectively, the Agreement and all notes, guaranties,
security agreements, certificates, landlord's agreements, mortgages and all
other agreements, documents and instruments now or hereafter executed or
delivered by Borrower or any Obligor in connection with, or to evidence the
transactions contemplated by, this Agreement.
"Obligations" means
all present and future Term Loans, advances, debts, liabilities, obligations,
guaranties, covenants, duties and indebtedness at any time owing by Borrower or
any Borrower to Lender, whether evidenced by this Agreement, any other Loan
Document or otherwise whether arising from an extension of credit, guaranty,
indemnification or otherwise (including all fees, costs and other amounts which
may be owing, whether absolute or contingent, whether due or to become due, and
whether arising before or after the commencement of a proceeding under the
Bankruptcy Code or any similar statute, including all interest, charges,
expenses, fees, attorney's fees and any other sums chargeable to Borrower under
this Agreement or under any other Loan Document.
"Obligor"
means any guarantor, endorser, acceptor, surety or other person liable on, or
with respect to, the Obligations or who is the owner of any property which is
security for the Obligations, other than any Borrower.
"Person"
means any individual, sole proprietorship, partnership, joint venture, limited
liability company, trust, unincorporated organization, association, corporation,
government or any agency or political division thereof, or any other
entity.
"Prime
Rate" means, at any given time, the prime rate as quoted in The Wall Street Journal as
the base rate on corporate loans posted as of such time by at least 75% of the
nation's 30 largest banks (which rate is not necessarily the lowest rate offered
by such banks).
"Subsidiary"
means any corporation or other entity of which a Person owns, directly or
indirectly, through one or more intermediaries, more than 50% of the capital
stock or other equity interest at the time of determination.
"Tangible Chattel
Paper" has the meaning set forth in the UCC.
"UCC"
means, at any given time, the Uniform Commercial Code as adopted and in effect
at such time in the State of Wisconsin.
Exhibit A
- Page 2
Exhibit
A
FORM
OF TERM NOTE
| $500,000.00 |
Milwaukee,
WI
|
|
April 21,
2008
|
FOR VALUE
RECEIVED, the undersigned ("Borrower"),
hereby unconditionally promise to pay, jointly and severally, to the order of
Phoenix Investors, LLC. ("Lender"),
a Delaware corporation having an address at 0000 Xxxxx Xxxxxxx Xxxxxx,
Xxxxxxxxx, XX, or at such other place as the holder of this Term Note
("Term
Note") may from time to time designate in writing, in lawful money of the
United States of America and in immediately available funds, the principal sum
of up to Five Hundred Thousand and 00/100 Dollars ($500,000.00), as such
principal amount is set forth on Schedule A Attached
hereto. Reference is hereby made to the Loan and Security Agreement
among Borrower and Lender of even date herewith (the "Loan
Agreement") for a statement of the terms and conditions under which the
loan evidenced hereby was made and is to be repaid. This Term Note
evidences a Term Loan described in the Loan
Agreement. Capitalized terms used herein which are not otherwise
specifically defined herein shall have the meanings ascribed to such terms in
the Loan Agreement.
The
outstanding principal balance of this Term Note shall be payable in full on the
Maturity Date. Prior thereto, the Term Note shall be repayable as set
forth in the Loan Agreement.
Borrower
further promises to pay interest on the outstanding principal amount hereof from
the date hereof until payment in full hereof at the per annum rate as set forth
in the Loan Agreement. Following the occurrence and during the
continuance of an Event of Default the entire outstanding principal balance of
this Term Note shall, at Lender's option, bear interest until paid in full at a
per annum rate equal to the interest rate applicable to the Term Loan from time
to time in effect plus four percent (4.0%). Until maturity, interest
on the outstanding principal amount hereof shall be payable in arrears on the
first day of each month, commencing one month after the opening of the first
terminal and on the Maturity Date. After maturity, whether by
acceleration or otherwise, accrued interest shall be payable on
demand. Interest as aforesaid shall be charged for the actual number
of days elapsed over a year consisting of three hundred sixty (360) days on the
actual daily outstanding balance hereof. Changes in the interest rate
provided for herein which are due to changes in the Prime Rate shall be
effective on the date of the change in the Prime Rate.
Notwithstanding
anything to the contrary contained herein, the aggregate of all interest
hereunder and charged or collected by Lender is not intended to exceed the
highest rate permissible under any applicable law, but if it should, such
interest shall automatically be reduced to the extent necessary to comply with
applicable law and Lender will refund to Borrower any such excess interest
received by Lender.
Exhibit A
- Page 3
Borrower
may, prepay the outstanding principal balance hereof in whole or in
part.
Upon and
after the occurrence of an Event of Default, this Term Note may, at the option
of Lender, and without demand, notice or legal process of any kind, be declared,
and immediately shall become, due and payable.
Payments
received by Lender from Borrower on this Term Note shall be applied to the
Obligations as provided in the Loan Agreement.
Presentment,
demand, protest and notice of presentment, demand, nonpayment and protest are
hereby waived by Borrower.
THIS TERM
NOTE SHALL BE INTERPRETED, AND THE RIGHTS AND LIABILITIES OF THE PARTIES HERETO
DETERMINED, IN ACCORDANCE WITH THE LAWS OF THE STATE OF WISCONSIN. If
any provision of this Term Note or the application thereof shall be held to be
void or unenforceable by any court of competent jurisdiction, such defect shall
not affect the remainder of this Term Note, which shall continue in full force
and effect. Whenever in this Term Note reference is made to Lender or
Borrower, such reference shall be deemed to include, as applicable, a reference
to their respective successors and assigns. The provisions of this
Term Note shall be binding upon the Borrower and its successors and assigns, and
shall inure to the benefit of Lender and its successors and
assigns.
|
Borrower:
Renewal
Plantations, Inc.
By:
/s/ Xxxxx
Chance
Xxxxx
Chance
CEO
|
Exhibit A
- Page 4
SCHEDULE
A
| Principal Loan | Date |
|
$_____________________________
$_____________________________
$_____________________________
$_____________________________
$_____________________________
$_____________________________
$_____________________________
$_____________________________
|
_____________________________
_____________________________
_____________________________
_____________________________
_____________________________
_____________________________
_____________________________
_____________________________
|
Exhibit A - Page 5
