When recorded, mail to:
Xxxxxxx X. Xxxxxxx, Esq.
White & Case LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
This document is intended
to be recorded in
Xxxxx County, Nevada
DEED OF TRUST
This Deed of Trust (as amended, modified or supplemented from time to
time, this "Security Instrument") is granted as of July 8, 1998, by Epic
Resorts - Westpark Resort, LLC, a Delaware limited liability company, as
trustor (hereinafter, together with its successors and assigns, called the
"Obligor"), whose address is 0000 Xxxxx Xxxxxx, Xxxxx 000, Xxxx xx Xxxxxxx,
XX 00000 to United Title of Nevada having an address at 0000 Xxxxxx Xxxxxx
Xxxxxxx #000, Xxx Xxxxx, Xxxxxx 00000, as trustee ("Trustee"), for the
benefit of United States Trust Company of New York, a New York banking
corporation, acting as trustee (herein together with its successors and
assigns in such capacity, the "Notes Trustee" for the Holders (as defined
below) pursuant to the Trust Indenture (as defined below), whose address is
000 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000.
PRELIMINARY STATEMENTS
(1) This Security Instrument is made pursuant to the Trust Indenture,
dated as of the date hereof (herein, as amended or otherwise modified from
time to time, the "Trust Indenture"), among Epic Resorts, Inc., a Delaware
corporation (herein, together with its successors and assigns, the
"Company"), Obligor and the other Subsidiary Guarantors as identified
therein, and the Notes Trustee acting as trustee for the Holders (defined
below), providing, among other things for a loan to the Company of
$130,000,000, with such loan being evidenced by the Company's 13% Senior
Secured Notes due 2005 in the aggregate principal amount of $130,000,000 (the
"Notes", such term to include all notes and other securities issued in
substitution or exchange therefor or in replacement thereof).
(2) Obligor has guaranteed to the holders of the Notes (the "Holders")
the payment when due of the Notes pursuant to a guaranty (the "Subsidiary
Guaranty").
(3) It is a condition precedent to the making of the loan to the
Company that the Obligor shall have executed and delivered to or for the
benefit of the Notes Trustee this Security Instrument.
(4) The Obligor desires to execute this Security Instrument to satisfy
the conditions described in the preceding paragraph and to secure the
performance of its covenants and agreements contained in the Trust Indenture,
herein and in any agreement or instrument made by it with respect to any
indebtedness or obligations secured hereby and to secure the payment when due
(whether at the stated maturity, by acceleration or otherwise) of all
obligations
(including obligations which, but for the automatic stay under Section 362(a)
of the Bankruptcy Code, would become due), but not necessarily in the order
set forth, of the following indebtedness, liabilities and obligations, now
existing or hereafter arising, ratably (including any modifications or
replacements thereof):
(a) the aggregate principal amount of $130,000,000, with interest
thereon, as evidenced by the Notes, maturing on or prior to June 15, 2005;
(b) all sums advanced by or on behalf of the Notes Trustee
pursuant to any term or provision of this Security Instrument or any
other agreement or instrument relating to or securing any of the
foregoing;
(c) all advances or disbursements of the Notes Trustee with
respect to the Property (defined below) for the payment of taxes,
levies, assessments, insurance, insurance premiums or costs incurred
in the protection of taxes, levies, assessments, insurance, insurance
premiums or costs incurred in the protection of the Property; and
(d) all other liabilities, obligations and indebtedness of the
Obligor incurred under, arising out of or in connection with the
Subsidiary Guaranty, the Trust Indenture and this Security Interest.
(all of such indebtedness, liabilities and obligations being
collectively referred to hereinafter as the "Indebtedness").
(5) This Security Instrument creates a lien on the fee simple interest
of the Obligor in the Property and shall automatically become a lien on any
and all time share interests in the Property, upon the creation of such time
share interests in the Property.
(6) The creation of time share interests in the Property shall be
permitted only upon satisfaction of the following conditions:
(i) No Event of Default (as hereinafter defined) shall have occurred or
be continuing under this Security Instrument;
(ii) Obligor shall have received and obtained approval from all
applicable federal, state and local government entities and Notes Trustee of
all documents necessary for the creation, marketing, sales, offers to sell
and operation of the time share interests, including, without limitation, the
declaration of the time share regime;
(iii) Obligor shall provide Notes Trustee acceptable evidence that it has
received from all applicable federal, state and local government entities all
approvals and consents, and made all filings, required in conjunction with
the establishment, marketing, sales, offers to sell and operation of the time
shares; and
(iv) United Title of Nevada shall have agreed to endorse the Notes
Trustee's title insurance policy insuring this Security Instrument, to
provide affirmative insurance to the effect
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that the Property consists of time share interests validly created and that
the lien of this Security Instrument shall constitute a valid first lien upon
the time share interests;
(v) The timeshare use and occupancy will not violate any private
covenant or restriction or any zoning, use or similar law, ordinance or
regulation affecting the use or occupancy of the Property; and
(vi) Obligor, immediately upon request by Notes Trustee at Obligor's
sole expense shall or shall cause to be made, executed and delivered to Notes
Trustee, in form and substance acceptable to Notes Trustee all documents that
Notes Trustee is advised are and/or deems necessary or appropriate to
evidence, document and/or secure the timeshare interests in the Property.
(7) Provided that no Event of Default has then occurred and is
continuing under this Security Instrument, the Notes Trustee shall, at the
expenses of Obligor, promptly release the lien hereof on each time share
interest following a sale of such time share interest to a person
unaffiliated with Obligor, and the Notes Trustee shall not have a lien on the
proceeds of any such sale.
GRANTING CLAUSES
NOW, THEREFORE, in consideration of the sum of $1.00, and other good
and valuable consideration, the receipt, sufficiency and adequacy of which
are hereby acknowledged, received to the Obligor's full satisfaction, and in
consideration of the loan made or to be made hereafter to or for the benefit
of the Company, the Obligor does grant, bargain, sell, assign, and transfer
to Trustee, in trust with power of sale, for the benefit of the Notes Trustee
and its successors and assigns, the real property situated in the State of
Nevada, described in Exhibit A attached hereto and made a part hereof by
reference;
(1) TOGETHER WITH all time share interests now and/or hereafter
created at the real property described in Exhibit A attached hereto; and
(2) TOGETHER WITH all rights and easements now and/or hereafter
created which are appurtenant to the real property described in Exhibit A,
including but not limited to those rights and easements more fully identified
thereon, if any; and
(3) TOGETHER WITH all and singular right, title and interest,
including any after-acquired title or reversion, in and to all other ways,
easements, streets, alleys, passages, water, water courses, riparian rights,
rights, liberties and privileges thereof, if any, and in any way appertaining
thereto; and
(4) TOGETHER WITH all rents, royalties, revenues, incomes, issues and
profits accruing and to accrue therefrom; and
(5) TOGETHER WITH all buildings and improvements of every kind and
description now or hereafter erected or placed thereon and all materials
intended for construction,
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reconstruction, alteration and repairs of such improvements now or hereafter
erected thereon, all of which materials shall be deemed to be included within
the property subject to this Security Instrument immediately upon the
delivery thereof to the Property; all fixtures and articles of personal
property now or hereafter owned by the Obligor and attached to, or located
on, and used in the operation or management of the Property; and all renewals
or replacements thereof, proceeds therefrom, or articles in substitution
therefor, whether or not the same are or shall be attached to such building
or buildings in any manner; it being mutually agreed that all the aforesaid
property owned by the Obligor and placed by it on the Property shall, so far
as permitted by law, be deemed to be fixtures and a part of the realty and
security for the Indebtedness secured by this Security Instrument; and
(6) TOGETHER WITH all leases, written or oral, and all agreements for
use or occupancy of all or any portion of the Property, together with any and
all extensions and renewals thereof and any and all further leases,
subleases, lettings or agreements (including subleases thereof and tenancies
following attornment) upon or covering use or occupancy of all or any part of
the Property (all such leases, agreements, subleases and tenancies sometimes
collectively referred to herein as the "Leases" and sometimes individually as
a "Lease"); and
(7) TOGETHER WITH all of the rents, income, receipts, revenues,
issues and profits now due or which may become due or to which Obligor may
now or hereafter become entitled or may demand or claim arising or issuing
from or out of the Leases or from or out of the Property or any part thereof;
and
(8) TOGETHER WITH all deposits made with or other security given to
utility companies by Obligor with respect to the Property, and all proceeds
of all insurance now or hereafter carried by, or payable to, Obligor with
respect to the Property, or otherwise now or hereafter payable with respect
to any loss or damage of the Property, and all claims or demands with respect
thereto; and
(9) TOGETHER WITH all right, title and interest of the Obligor in and
to any operating, use, or management agreement pertaining to the Property and
all cash payments to be made to or for the account of Obligor pursuant thereto
and any other proceeds thereof; and
(10) TOGETHER WITH all right, title and interest of the Obligor in and
to any leases for equipment now or hereafter located at or used in connection
with the Property, including without limitation all leases for office
equipment, maintenance and operating equipment, recreational equipment and
fixtures, telephone equipment, furniture and furnishings; and
(11) TOGETHER WITH all permits, licenses and franchises, and all
contract rights and other intangibles now or hereafter owned by the Obligor
and relating to the ownership, construction, use, operation, occupancy or
development of the Property, including, without limitation, any plans,
specifications and drawings pertaining to the development thereof, and
contracts with architects and contractors; and
(12) TOGETHER WITH all awards and other compensation heretofore or
hereafter to be made to the present and all subsequent owners of the property
subject to this
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Security Instrument for any taking by eminent domain, either permanent or
temporary, of all or any part of the Property or any easement or appurtenance
thereof, including severance and consequential damage and change in grade of
streets, which such awards and compensation are hereby assigned to the Notes
Trustee; the Obligor hereby appoints the Notes Trustee its Attorney-in-Fact,
with an interest, and authorizes, directs and empowers such Attorney, at the
option of such Attorney, on behalf of the Obligor and its successors or
assigns to collect and receive the proceeds thereof, to give proper receipts
and acquittances therefor (but not to adjust or compromise the claim) and,
after deducting reasonable expenses of collection, to apply the net proceeds
without penalty or premium as a credit upon any portion, as selected by the
Notes Trustee, of the Indebtedness secured hereby, notwithstanding the fact
that the amount owing hereon may not then be due and payable or that such
Indebtedness is otherwise adequately secured.
All of the property conveyed or intended to be conveyed to Trustee in
the granting clauses (1) through (12) above, is described in this Security
Instrument as the "Property."
TO HAVE AND TO HOLD the Property with the appurtenances thereunto
belonging unto the Trustee and its successors and assigns, forever, for the
benefit of the Notes Trustee for the purposes and uses herein set forth,
until such time as all of the Indebtedness and obligations secured hereby
shall have been paid in full.
The Obligor covenants with the Trustee, its successors and assigns,
that at and until the ensealing of these presents: (i) the Obligor is well
seized of and has a good and indefeasible estate in fee simple in the
Property, and has good right to bargain, sell and convey, and create a
security interest in, the Property in manner and form as above written; (ii)
the Obligor will warrant and defend the Property with the appurtenances
thereunto belonging to the Trustee, its successors and assigns, forever
against all lawful claims, and demands whatsoever subject only to such
exceptions to title permitted by the terms of the Trust Indenture; (iii) the
Property and the intended use thereof by the Obligor comply to the best of
the Obligor's knowledge with all applicable restrictive covenants, zoning
ordinances and building codes and flood disaster laws, and, to the extent
that noncompliance therewith would materially adversely affect the value or
marketability of the Property, all applicable occupational, health and
environmental and other applicable laws, rules and regulations of any other
governmental authority whatsoever; and (iv) the Obligor will execute,
acknowledge and deliver all necessary assurances to the Trustee of the title
to the Property as provided above.
This Security Instrument is granted as security for the payment of
the Indebtedness. In accordance with the provisions of the Notes, the whole
of the principal sum thereof then unpaid may be declared and become due and
payable upon demand or upon the occurrence of an Event of Default hereunder
or under the Trust Indenture or the Notes. This Security Instrument is given
for the purpose of creating a lien on the Property and expressly is to secure
the Indebtedness.
UPON THE TERMS AND SUBJECT TO THE CONDITIONS that are hereinafter
set forth; PROVIDED, HOWEVER, that if the Company pays or causes to be paid
to the Holders all sums secured hereby in the manner provided in the Notes
and the Trust Indenture,
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and the Obligor fully pays and performs its obligations under the Subsidiary
Guaranty, the Trust Indenture, and in this Security Instrument and does keep
and perform every obligation, term, covenant, condition and warranty
contained in the Subsidiary Guaranty, the Trust Indenture and in this
Security Instrument, then and in such case the estate, right, title and
interest of Trustee in and to the Property shall cease, and upon proof being
given to the satisfaction of the Notes Trustee that the Indebtedness has been
paid or satisfied in accordance with its terms, and upon payment of all fees,
costs, charges and liabilities chargeable to or incurred by Trustee or
otherwise provided for in this Security Instrument, then this and the estate
hereby granted and conveyed shall be reconveyed, without warranty, at the
sole expense of Obligor. The recitals in such reconveyance of any matters of
fact shall be conclusive proof of the truth thereof. The grantee in such
reconveyance may be described in general terms as "the person or persons
legally entitled thereto".
The Obligor, intending to bind its successors and assigns, hereby
covenants and agrees as follows:
1. The Obligor will duly keep and perform all covenants, agreements,
conditions and stipulations binding on the Obligor under the Subsidiary
Guaranty or the Trust Indenture. The Obligor hereby waives promptness,
diligence, notice of acceptance and any other notice with respect to any of
the Indebtedness and this Security Instrument and any requirement that the
Notes Trustee or other holder of the Indebtedness secured hereby protect,
secure, perfect or insure any security interest or lien or any property
subject thereto or exhaust any right or take any action against any other
person, or any collateral, or pursue any other remedy in the power of the
Notes Trustee or other holder of any of the Indebtedness secured thereby.
2. To facilitate payment and performance of the Indebtedness, the
Obligor hereby absolutely transfers and assigns to Notes Trustee all right,
title and interest of the Obligor in and to the Leases.
3. (a) No later than ten days prior to the date when any installment
of taxes and assessments is due, without penalty, interest or delinquency,
the Obligor shall subject to the Notes Trustee evidence of the due and
punctual payment of such taxes, assessments, reassessments and other
governmental charges. The Obligor will also pay all taxes and assessments or
charges which may be levied on the Indebtedness secured hereby or the
interest therein excepting the federal income tax imposed under the laws of
the United States and excepting state franchise and state income taxes. Any
assessment which is payable in installments at the application of the Obligor
shall, nevertheless, for the purposes of this section, be deemed due and
payable by the Obligor in its entirety on the day the first installment
becomes due and payable or a lien, unless the written approval of the Notes
Trustee is obtained for such installment payments of assessments.
(b) Notwithstanding the provision of Section 3 above, the Obligor
shall have the right to contest in good faith any of such taxes and
assessments upon posting with the Notes Trustee sufficient security,
reasonably satisfactory to the Notes Trustee, for the payment thereof, with
interest, costs and penalties, under written agreement conditioning payment
of such contested taxes and assessments upon the the resolution of such
contest, or prior thereto if the
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continuance of such contest shall put the Property or any part thereof in
jeopardy of tax sale or forfeiture.
4. If at any time the United States or the State or Commonwealth in
which the Property is located or any of their subdivisions having
jurisdiction shall levy, assess or charge any tax (including, without
limitation, documentary stamp or intangible tax), assessment or imposition
upon this Security Instrument, the Notes, or the Indebtedness secured hereby
or the interest of the Notes Trustee in the Property or upon the Notes
Trustee by reason of or as holder of any of the foregoing, then the
Indebtedness and accrued interest thereon shall be and become due and payable
at the election of the Notes Trustee; provided, however, that such election
and the right to elect shall be unavailing if the Obligor lawfully may pay
for such stamps or such tax, including interest and penalties thereon, to or
for the benefit of the Notes Trustee and the other holders of the
Indebtedness, and the Obligor elects to pay and does, in fact, pay when
payable, for all such stamps or such tax, as the case may be, including
interest and penalties thereon, prior to any such election by the Notes
Trustee. The Obligor further agrees to deliver to the Notes Trustee, at any
time, upon demand, evidence of citizenship and such other evidence as may be
required by any government agency having jurisdiction in order to determine
whether the obligation secured hereby is subject to or exempt from any such
tax or any other governmental filing or reporting requirement.
5. The Obligor shall keep the Property free and clear from all
mechanics liens and statutory liens of every kind other than taxes and
permitted assessments which may be a lien but not yet due and payable and the
Obligor will not voluntarily create or permit to be created or filed against
its interests in the Property, or suffer to exist, any mortgage lien or other
lien or liens inferior or superior to the lien of this Security Instrument
(other than the lien or liens for real estate taxes and assessments not yet
due and payable) or if filed, the Obligor will have the same discharged of
record either by payment, the bonding thereof or other lawful means within 30
days after notice of filing and further, that the Obligor will keep and
maintain the same free from all claims of all persons supplying labor,
materials or services which will enter into or otherwise contribute to the
construction of any and all improvements to the Property, notwithstanding by
whom such labor or materials may have been contracted; provided, however,
that the Obligor shall have the right to contest in good faith any such
mechanics' lien or statutory lien upon posting with the Notes Trustee
sufficient security, satisfactory to the Notes Trustee, for the payment
thereof, with interest, costs and penalties, under written agreement
conditioning payment of such contested mechanics' lien or statutory lien upon
the resolution of such contest, or prior thereto if the continuance of such
contest or litigation shall put the Property or any part thereof in jeopardy
of foreclosure sale or forfeiture for such lien.
6. The Obligor agrees that the Obligor shall not (i) sell, encumber
(including, without limitation, by means of subordinate mortgage or lien upon
the Property or any part thereof or interest therein), assign, lease or
dispose of the Property or any part thereof or interest therein, except in
accordance with, and to the extent permitted by, the terms and provisions of
the Trust Indenture, or (ii) enter into any contract or agreement to do
anything prohibited by clause (i) of this Section 6 expressly including,
without limitation, any land contract, lease/purchase, lease/option or option
agreement without, in each such case, first obtaining the written consent of
the Notes Trustee; except, however, that the Obligor shall have the right,
without such consent,
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to sell timeshare units included in the Property on and subject to the terms
and conditions of the Trust Indenture.
7. The Obligor hereby acknowledges that the Indebtedness was
incurred in good faith for full value received.
8. The Obligor warrants and represents that:
(a) The Obligor is not now in default under any instruments or
obligations relating to the Property and no party has asserted any claim
of default against the Obligor relating to the Property.
(b) The execution and performance of this Security Instrument and the
consummation of the transactions hereby contemplated will not result in
any breach of, or constitute a default under, any mortgage, lease, bank
loan, credit agreement, trust indenture or other instrument to which the
Obligor is a party or by which it or any of its property (including,
without limitation, the Property) may be bound or affected, nor do any
such instruments impose or contemplate any obligations which are or may be
inconsistent with any other obligations imposed on the Obligor under any
other instrument heretofore or hereafter delivered by the Obligor.
(c) As of the date hereof, there are no actions, suits or proceedings
(including, without limitation, any condemnation or bankruptcy
proceedings) pending or threatened against or affecting the Obligor or the
Property, or which may adversely affect the validity or enforceability of
this Security Instrument, at law or in equity, or before or by any
governmental authority, except as disclosed in writing to the Notes
Trustee prior to the date of execution and delivery hereof as contemplated
by the terms and provisions of the Trust Indenture, and the Obligor is not
in default with respect to any writ, injunction, decree or demand of any
court or any governmental authority affecting the Property.
(d) The Property is not used principally or primarily for farming or
agricultural purposes.
9. (a) The Obligor will maintain flood insurance, if required,
pursuant to a designation of the area in which the Property is located as
flood prone or a flood risk area, as defined by the Flood Disaster Protection
Act of 1973, as amended, as well as comply with any additional requirements
of the National Flood Insurance Program as set forth in such Act.
(b) The Obligor shall maintain for the mutual benefit of the Notes
Trustee and the Obligor general public liability insurance against claims for
personal injury, death or property damage occurring upon, in or about the
Property and on, in or about the adjoining streets and passageways, such
insurance to afford protection to the limits of not less than those then
customarily carried with respect to real property similar in general
location, use and occupancy to the Property, but in no event less than a
single limit amount of $5,000,000. All of such insurance shall be primary and
non-contributing with any insurance which may be carried by the Notes Trustee.
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(c) In the event such coverage is provided as part of a blanket
policy, then in such event the amount of the coverage specifically applicable
to the Property shall be stated on the face of the policy. All insurance
policies, to the extent of its interest, are to be for the benefit of and
first payable in case of loss to the Notes Trustee as first mortgagee without
contribution and the Obligor shall deliver to the Notes Trustee a copy of any
renewal or replacement policies and original certificates thereof to the
Notes Trustee at such place or to such other party as the Notes Trustee may,
from time to time, designate in writing, before the date of such expiration
or termination of any existing policy.
(d) All insurance policies required by this Section 9 shall contain
an express provision or endorsement which states the substance of the
following in a manner acceptable to the Notes Trustee: "The policy of
insurance shall not be cancelled, permitted to lapse by reason of
non-renewal, altered, changed, amended or modified, nor shall any coverage
therein be reduced, deleted, amended, modified, changed or cancelled by
either the party named as the insured, or the insurance Obligor issuing this
policy, without at least 30 days' prior written notice having been given to
SunTrust, Central Florida, National Association, as Notes Trustee."
10. (a) The term "Hazardous Materials," as used in this Security
Instrument, shall mean any (i) hazardous wastes and/or toxic chemicals,
materials, substances or wastes as defined by the Environmental Laws set
forth in Subsection 10(b); (ii) any "oil", as defined by the Clean Water Act
(as defined in Subsection 10(b) below), as amended from time to time, and
regulations promulgated thereunder (including crude oil or any fraction
thereof); (iii) any substance, the presence of which is prohibited, regulated
or controlled by any other applicable federal or state or local laws,
regulations, statutes or ordinances now in force or hereafter enacted
relating to waste disposal or environmental protection with respect to the
exposure to, or manufacture, possession, presence, use, generation, storage,
transportation, treatment, release, emission, discharge, disposal, abatement,
cleanup, removal, remediation or handling; (iv) any asbestos or asbestos
containing materials, polychlorinated biphenyls ("PCBs") in the form of
electrical equipment, fluorescent light fixtures with ballasts, cooling oils
or any other form, urea formaldehyde, atmospheric radon at levels over four
picocuries per cubic liter; (v) any solid, liquid, gaseous or thermal
irritant or contaminant, such as smoke, vapor, soot, fumes, alkalis, acids,
chemicals, pesticides, herbicides, sewage, industrial sludge or other similar
wastes; (vi) industrial, nuclear or medical by-products; and (vii)
underground storage tanks (whether filled or unfilled).
(b) The term "Environmental Laws," as used in this Section 10, shall
mean all present and future laws, statutes, ordinances, rules, regulations,
orders and determinations of any governmental authority, pertaining to
health, protection of the environment, natural resources, conservation,
wildlife, waste management, regulation of activities involving Hazardous
Materials, and pollution, including, without limitation, the Comprehensive
Environmental Response, Compensation and Liability Act ("Superfund" or
"CERCLA"), 42 U.S.C. Section 9601, ET SEQ., the Superfund Amendments and
Reauthorization Act of 1986 ("XXXX"), 42 U.S.C. Section 9601(20)(D), the
Resource Conservation and Recovery Act ("RCRA"), 42 U.S.C. Section 6901, ET
SEQ., the Federal Water Pollution Control Act, as amended by the Clean Water
Act (the "Clean Water Act"), 33 U.S.C. Section 1251, ET SEQ., the Clean Air
Act ("CAA"), 42 U.S.C. Section 7401, ET SEQ., and the Toxic Substances
Control Act, 15 U.S.C. Section 2601, ET SEQ., Nevada Revised
Statutes ("NRS") chapters
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444, 445, 459, and 590, NRS Sections 618.750-618.850, inclusive, and NRS
Section 477.045 as amended from time to time.
(c) The Obligor shall, and the Obligor shall cause all employees,
agents, contractors and tenants of the Obligor and any other persons present
on or occupying the Real Property to, keep and maintain the Property,
including the soil and ground water thereof, in compliance with, and not
cause or permit the Property, including the soil and ground water thereof, to
be in violation of any Environmental Laws. Neither the Obligor nor any
employees, agents, contractors or tenants of the Obligor or any other persons
occupying or present on the Property shall use, generate, manufacture, store
or dispose on, under or about the Property or transport to or from the
Property any Hazardous Materials.
(d) The Obligor immediately shall advise Notes Trustee in writing of:
(i) any notices from any governmental or quasi-governmental agency or
authority of violation or potential violation of any Environmental Law
received by the Obligor; (ii) any and all enforcement, cleanup, removal or
other governmental or regulatory actions instituted, completed or threatened
pursuant to any Environmental Law; (iii) all claims made or threatened by any
third party against the Obligor or the Property relating to damage,
contribution, cost recovery compensation, loss or injury resulting from any
Hazardous Materials (the matters set forth in clauses (i) (ii) and (iii)
above are hereinafter referred to as "Hazardous Materials Claims"); and (iv)
discovery by the Obligor of any occurrence or condition on any real property
adjoining or in the vicinity of the Property that could cause the Property to
become contaminated by or with Hazardous Materials. Notes Trustee shall have
the right but not the obligation to join and participate in, as a party if it
so elects, any legal proceedings or actions initiated in connection with any
Hazardous Materials Claims and to have its reasonable attorneys' and
consultants' fees in connection therewith paid by the Obligor upon demand.
(e) The Obligor shall be solely responsible for, and shall indemnify,
defend, and hold harmless Notes Trustee, its directors, officers, employees,
agents, successors and assigns from and against, any loss, damage, cost,
expense or liability or whatever kind or nature, known or unknown, contingent
or otherwise, directly or indirectly arising out of or attributable to the
use, generation, storage, release, threatened release, discharge, disposal or
presence (whether prior to or after the date of this Security Instrument) of
Hazardous Materials on, in, under or about the Property (whether by the
Obligor, a predecessor in title, any tenant, or any employees, agents,
contractor or subcontractors of any of the foregoing or any third persons at
any time occupying or present on the Property), including, without
limitation: (i) personal injury; (ii) death; (iii) damage to property; (iv)
all consequential damages; (v) the cost of any required or necessary repair,
cleanup or detoxification of the Property, including the soil and ground
water thereof, and the preparation and implementation of any closure,
remedial or other required plans; (vi) damage to any natural resources; and
(vii) all reasonable costs and expenses incurred by Notes Trustee in
connection with the foregoing clauses (i) through (vi), including but not
limited to reasonable attorneys' and consultants' fees; provided, however,
that nothing contained in this Section shall be deemed to preclude the
Obligor from seeking indemnification from or otherwise proceeding against,
any third party including, without limitation, any tenant or predecessor in
title to the Property. The covenants, agreements and indemnities set forth in
this Section shall be binding upon the Obligor and its successors and assigns,
and shall survive each of repayment of
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the Indebtedness, foreclosure of the Property, and the Obligor granting a
deed in lieu of foreclosure of the Property. Any costs or expenses incurred
by Notes Trustee for which the Obligor is responsible or for which the
Obligor has indemnified Notes Trustee shall be paid to Notes Trustee on
demand, with interest at the default rate specified in the Notes from the
date incurred by Notes Trustee until paid in full, and shall be secured
hereby. Without Notes Trustee's prior written consent, the Obligor shall not
enter into any settlement, consent decree or other compromise in respect of
any Hazardous Materials Claims.
(f) In the event Notes Trustee reasonably determines that an
investigation of the Property for the presence of Hazardous Materials (an
"Environmental Audit") is necessary in order to maintain the value of the
Notes Trustee's security in the Property, the Obligor shall retain, upon
Notes Trustee's request, or Notes Trustee may retain directly, at the sole
cost and expense of the Obligor, a licensed geologist, industrial hygienist
or an environmental consultant (referred to hereinafter as the "Consultant")
acceptable to Notes Trustee to conduct the Environmental Audit. Notes
Trustee's determination to require an Environmental Audit shall be deemed
reasonable at any time there is Default under the Trust Indenture or
hereunder or in the event that Notes Trustee has received notice of the
likely existence of Hazardous Materials upon or in the Property. The
Environmental Audit shall be performed in a manner reasonably calculated to
discover the presence of Hazardous Materials contamination taking into
consideration the known uses of the Property and property in the vicinity of
the Property and any factors unique to the Property. If the Obligor shall
fail to pay for or obtain an Environmental Audit as provided for herein,
Notes Trustee may, but shall not be obligated to, obtain the Environmental
Audit, and the Obligor immediately and without demand shall repay all costs
and expenses incurred by Notes Trustee in connection therewith, with interest
at the default rate specified in the Notes from the date of such payments or
advances until paid in full, and such sums so advanced or expended, with
interest as aforesaid, shall be secured hereby.
(g) The Obligor shall cooperate with the Consultant and allow entry
and access to all portions of the Property for the purpose of Consultant's
investigation. The Obligor shall comply, at its sole cost and expense, with
all recommendations contained in the Environmental Audit reasonably required
to bring the Property into compliance with all Environmental Laws and any
recommendation for additional testing and studies to detect the quantity and
types of Hazardous Materials present, if Notes Trustee requires the
implementation of the same.
11. Notes Trustee shall have, and is hereby granted by the Obligor
with a warranty of further assurances, the irrevocable power to appoint a
substitute trustee or trustees hereunder and to remove any or all trustees
hereunder from time to time without notice, unless required by applicable
law, and without specifying any reason therefor, by filing for record a deed
of appointment in the office in which this Security Instrument is recorded.
Such power of removal and appointment may be exercised as often and whenever
Notes Trustee deems it advisable, and the exercise of such power, no matter
how often, shall not result in an exhaustion of such power. Upon the
recordation of each such deed of appointment or removal, each trustee so
appointed shall become fully vested with identically the same title and
estate in and to the Property and with all the identical rights, powers,
trusts and duties of his predecessor or predecessors in the Property, as if
originally named as a Trustee hereunder. Whenever in this Security Instrument
reference is made to Trustee, such reference shall be construed to mean the
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trustee or trustees for the time being, whether the original or any successor
trustee. All title, estate, rights, powers, trusts and duties hereunder
given, appertaining to or devolving upon Trustee shall be in each Trustee if
there is more than one then serving hereunder, so that any action hereunder
or purporting to be hereunder of either one of the original or any successor
trustees shall for all purposes be considered to be, and shall be as
effective as, the action of all trustees. The substitution of one trustee
shall be sufficient even if in replacement of more than one trustee.
12. In the event the Obligor shall fail to comply with any or all
of its covenants, agreements, conditions and stipulations herein set forth,
then the Notes Trustee shall after notice to the Obligor be and hereby is
authorized and empowered at its option, but without legal obligation to do
so, to pay or perform the same without waiver of any other remedy. In
addition, the Notes Trustee is authorized and empowered at its option, but
without legal obligation to do so, to enter, or have its agents enter, the
Property whenever necessary for the purpose of inspecting the Property and
curing any default hereunder. The Obligor agrees that the Notes Trustee shall
thereupon have a claim against the Obligor for all sums paid by the Notes
Trustee for such defaults so cured, together with a lien upon the Property
for the sum so paid plus interest at the default rate specified in the Notes.
13. The Obligor shall not commit waste upon the Property or suffer
waste to be committed thereon. The Obligor will keep the Property in good
order and repair and in compliance in all material respects with any law,
regulation, ordinance or contract affecting the Property. The Obligor shall
observe and comply with all conditions and requirements necessary to preserve
and extend any and all material rights, licenses, permits (including but not
limited to zoning variances, special exceptions and non-conforming uses),
privileges, franchises and concessions which are applicable to the Property
or which have been granted to or contracted for by the Obligor in connection
with any existing or presently contemplated use of the Property and shall
obtain and keep in full force and effect all necessary governmental and
municipal approvals as may be necessary from time to time to comply in all
material respects with all mining, environmental and other requirements and
with any and all conditions attached to the insurance relating to the
Property and the condition thereof.
14. The Obligor will give the Notes Trustee immediate notice of the
actual or threatened commencement of any proceedings under eminent domain
affecting all or any part of the Property or any easement therein or
appurtenances thereof, including severance and consequential damage and
change in grade of streets, and will deliver to the Notes Trustee copies of
any and all papers served in connection with any such proceedings. Except as
provided in subsection (a) below, the Obligor agrees that all awards
heretofore or hereafter made by any public or quasi-public authority to the
present and all subsequent owners of the Property by virtue of an exercise of
the right of eminent domain by such authority, including any award for taking
of title, possession or right of access of a public way, or for any change of
grade or streets affecting the Property, are hereby assigned to the Notes
Trustee and the Notes Trustee at its option is hereby authorized, directed
and empowered to collect and receive the proceeds of any such awards from the
authorities making the same and to give proper receipts therefor. After
deducting from such proceeds any expenses incurred by the Notes Trustee in
the collection or
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handling thereof, the Notes Trustee shall apply the net proceeds as to the
Indebtedness in such order as determined by the Notes Trustee.
The Obligor hereby covenants and agrees to and with the Notes
Trustee, upon the request of the Notes Trustee to make, execute and deliver
any and all assignments and other instruments sufficient for the purpose of
assigning all such awards to the Notes Trustee, free and clear and discharged
of any and all encumbrances of any kind or nature whatsoever except as above
stated.
15. In the event an action shall be instituted to foreclose this
Security Instrument, or prior to foreclosure but after default, the Notes
Trustee shall be entitled to the appointment of a receiver of the rents,
issues and profits of the Property as a matter of right, with power to
collect the rents, issues and profits of the Property due and becoming due
during the period of default and/or the pendency of such foreclosure suit to
and including the date of confirmation of the sale under such foreclosure
after such confirmation, such rents, issues and profits being hereby
expressly assigned and pledged as security for the payment of the
Indebtedness secured by this Security Instrument without regard to the value
of the Property or the solvency of any person or persons liable for the
payment of the Indebtedness and regardless of whether the Notes Trustee has
an adequate remedy at law. The Obligor for itself and for any subsequent
owner hereby waives any and all defenses to the application for a receiver as
above provided and hereby specifically consents to such appointment, but
nothing herein contained is to be construed to deprive the holder of this
Security Instrument of any right or remedy or privilege it may now have under
the law to have a receiver appointed. The provision for the appointment of a
receiver and the assignment of such rents, issues and profits is made an
express condition upon which the Loans hereby secured are made. In such
event, the court shall at once on application of the Notes Trustee or its
attorney in such action, appoint a receiver to take immediate possession of,
manage and control the Property, for the benefit of the holder or holders of
the Indebtedness and of any other parties in interest, with power to collect
the rents, issues and profits of the Property during the pendency of such
action, and to apply the same toward the payment of the several obligations
herein mentioned and described, notwithstanding that the same or any part
thereof is occupied by the Obligor or any other person. The rights and
remedies herein provided for shall be deemed to be cumulative and in addition
to and not in limitation of those provided by law and if there be no receiver
so appointed, the Notes Trustee itself may proceed to collect the rents,
issues and profits from the Property. From any such rents, issues, and
profits collected by the receiver or by the Notes Trustee prior to a
foreclosure sale, there shall be deducted the cost of collection thereof and
the expenses of operation of the Property, including but not limited to real
estate commissions, receiver's fee and the reasonable fees of its attorney,
if any, and the Notes Trustee's attorney's fees, if permitted by law, and
court costs, the remainder to be applied against the Indebtedness. In the
event the rents, issues and profits are not adequate to pay all tax and other
expenses of operation, the Notes Trustee may, but is not obligated to,
advance to any receiver the amounts necessary to operate, maintain and
repair, if necessary, the Property and any such amounts so advanced, together
with interest thereon at the default rate specified in the Notes from and
after the date of advancement, shall be secured by this Security Instrument
and have the same priority of collection as the principal of the Indebtedness
secured hereby.
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16. No sale of the Property, no forbearance on the part of the Notes
Trustee, no extension of the time for the payment of the Indebtedness and no
change in the terms of the payment thereof consented to by the Notes Trustee
shall in any way whatsoever operate to release, discharge, modify, change or
affect the original liability of the Obligor hereunder or the original
liability of the Borrower or any other obligor under any of the Indebtedness,
either in whole or in part. No waiver by the Notes Trustee of any breach of
any covenant of the Obligor herein contained shall be construed as a waiver
of any subsequent breach of the same or any other covenant herein contained.
The failure of the Notes Trustee to exercise the option for acceleration of
maturity and/or foreclosure (including sale under power of sale hereunder)
following any default as aforesaid or to exercise any other option granted to
the Notes Trustee hereunder in any one or more instances, or the acceptance
by the Notes Trustee of partial payments hereunder shall not constitute a
waiver of any such default, nor extend or affect the grace period, if any,
but such option shall remain continuously in force with respect to any
unremedied or uncured default. Acceleration of maturity once claimed
hereunder by the Notes Trustee may, at the option of the Notes Trustee, be
rescinded by written acknowledgment to that effect by the Notes Trustee, but
the tender and acceptance of partial payments alone shall not in any way
affect or rescind such acceleration of maturity, or extend or affect the
grace period, if any. The Notes Trustee may pursue any of its rights without
first exhausting its rights hereunder and all rights, powers and remedies
conferred upon the Notes Trustee herein are in addition to each and every
right which the Notes Trustee may have hereunder at law or equity and may be
enforced concurrently therewith.
17. If any action or proceeding be commenced, to which action or
proceeding the Notes Trustee is made a party by reason of the execution of
this Security Instrument or the Indebtedness, or in which it becomes
necessary to defend or uphold the lien of this Security Instrument, or the
priority thereof or possession of the Property, or otherwise to perfect the
security hereunder, or in any suit, action, legal proceeding or dispute of
any kind in which the Notes Trustee is made a party or appears as party
plaintiff or defendant, affecting the interest created herein, or the
Property, including, but not limited to, bankruptcy, probate and
administration proceedings, foreclosure of this Security Instrument or any
condemnation action involving the Property, all sums paid by the Notes
Trustee for the expense of any litigation to prosecute and defend the rights
and liens created hereby shall be paid by the Obligor, to the extent
permitted by applicable law, together with interest from the date of payment
at the Default Rate. Any such sum and the interest thereon shall be
immediately due and payable upon demand and be secured hereby, having the
benefit of the lien hereby created, as a part hereof and its priority.
18. Each remedy or right of the Notes Trustee shall not be exclusive
of but shall be in addition to every other remedy or right now or hereafter
existing at law or in equity. No delay in the exercise or omission to
exercise any remedy or right accruing on any default shall impair any such
remedy or right or be construed to be a waiver of any such default or
acquiescence therein, nor shall it affect any subsequent default of the same
or a different nature. Every such remedy or right may be exercised
concurrently or independently and when and as often as may be deemed
expedient by the Notes Trustee.
19. Upon an Event of Default, to the extent permitted by any
applicable law of Nevada, Notes Trustee personally, or by the Trustee, or by
their respective agents or attorneys, and without becoming a
mortgagee-in-possession, may enter into and upon all or any part of the
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Property, and each and every part hereof, and may exclude the Obligor, its
agents, and servants wholly therefrom, and having and holding the same, may
use, operate, manage and control the Security or any part thereof and conduct
the business thereof, either personally or by its superintendents, managers,
agents, servants, attorneys or receivers; and upon such entry, Notes Trustee,
at the expense of the Obligor, may, at Notes Trustee's sole option, insure
the same; and likewise, from time to time, at the expense of the Obligor,
Notes Trustee may make all necessary or proper repairs, renewals and
replacements and such useful alterations, additions, betterments and
improvements thereto and thereon as to Notes Trustee may seem advisable; and
in every such case Notes Trustee shall have the right to manage and operate
the Property and to carry on the business thereof and exercise all rights and
powers of the Obligor with respect thereto either in the name of the Obligor
or otherwise as it shall deem best; and after deducting the expenses of
conducting the business thereof and of all maintenance, repairs, renewals,
replacements, alterations, additions, betterments and improvements necessary
to operate the improvements or their intended purposes and amounts necessary
to pay for taxes, assessments, insurance and prior or other proper charges
upon the Property or any part hereof, as well as reasonable compensation for
the services of Notes Trustee and Trustee, and for all attorneys,
consultants, agents, clerks, servants and other parties employed by Notes
Trustee or Trustee, Notes Trustee shall apply the moneys arising as aforesaid
to the Liabilities in such manner and at such times as Notes Trustee shall
determine in its sole discretion, when and as the same shall become payable
and/or to the payment of any other sums required to be paid by the Obligor
under this Security Instrument.
20. (a) Upon an Event of Default, to the extent permitted by any
applicable law of Nevada, Notes Trustee may, with or without entry,
personally or by its agents or attorneys, insofar as applicable:
(i) Request the Trustee to sell the Property or any part thereof
pursuant to the procedures provided by law at one or more sales as an
entity or in parcels, and at such time and place upon such terms and
after such notice thereof as may be required or permitted by law; and/or
(ii) Institute an action of judicial foreclosure on this Security
Instrument or institute other proceedings according to law for the
foreclosure hereof, and may prosecute the same to judgment, execution and
sale for the collection of the Indebtedness, and all interest with respect
thereto, together with all taxes and insurance premiums advanced by Notes
Trustee and other sums payable by the Obligor hereunder, and all fees,
costs and expenses of such proceedings, including reasonable attorneys'
fees and expenses; and/or
(iii) Take such steps to protect and enforce its rights whether by
action, suit or proceeding in equity or at law for the specific
performance of any covenant, condition or agreement in the Loan
Documents or in and of the execution of any power herein granted,
or for any foreclosure hereunder, or for the enforcement of any
other appropriate legal or equitable remedy or otherwise as Notes
Trustee shall elect.
(b) To the extent permitted by law of Nevada, the Trustee may
postpone from time to time any sale by them to be made under or by virtue of
this Security Instrument by postponement at the time and place appointed for
such sale or for such postponed sale or sales;
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and, except as otherwise provided by any applicable provision of law, the
Trustee, without further notice or publication, may make such sale at the
time and place to which the same shall be so postponed.
(c) Upon the completion of any sale or sales made by the Trustee
under or by virtue of this Security Instrument, Trustee shall execute and
deliver to the accepted purchaser or purchasers a good and sufficient
instrument, or good and sufficient instruments, conveying, assigning and
transferring, without warranty, all estate, right, title and interest in and
to the property and rights sold. The Trustee shall make all the necessary
conveyances, assignments, transfers and deliveries of any part of the
Property and rights so sold and for that purpose the Trustee may execute all
necessary instruments of conveyance, assignment and transfer. Any such sale
or sales made under or by virtue of this Section 19, whether made under the
power of sale herein granted or under or by virtue of judicial proceeding or
of a judgment or decree of foreclosure and sale, shall operate to divest all
the estate, right, title, interest, claim and demand whatsoever, whether at
law or in equity, of the Obligor in and to the properties, interests and
rights so sold, and shall be a perpetual bar both at law and in equity
against the Obligor and against any and all persons claiming or who may claim
the same, or any part thereof from, through or under the Obligor.
(d) Upon any sale, whether under the power of sale hereby given or by
virtue of judicial proceedings or of a judgment or decree of foreclosure and
sale, except as required by law, it shall not be necessary for the Trustee or
any public officer acting under execution or order of court to have present
or constructive possession of any of the Property.
(e) The recitals contained in any conveyance made by the Trustee to
any purchaser at any sale made pursuant hereto or under applicable law shall
be conclusive evidence of the matters therein stated, and all prerequisites
to such sale shall be presumed to have been satisfied and performed.
(f) The receipt by Trustee of the purchase money paid at any such
sale, or the receipt by any other person authorized to receive the same,
shall be sufficient discharge therefor to any purchaser of the property or
any part thereof, sold as aforesaid, and no such purchaser, or his
representatives, grantees or assigns, after paying such purchase money and
receiving such receipt, shall be bound to see to the application of such
purchase money, or any part thereof, or be bound to inquire as to the
authorization, necessity, expediency or regularity of any such sale.
(g) In case the liens or the Property interests hereunder shall be
foreclosed by Trustee's sale or by other judicial or non-judicial action, the
purchaser at any such sale shall receive, as an incident to his ownership,
the right to immediate possession of the Property or any part thereof,
subsequent to foreclosure, the Obligor or the Obligor's successors (except
tenants who have entered into subordination, non-disturbance and attornment
agreements with Notes Trustee) shall be considered as tenants at sufferance
of the purchaser at foreclosure sale, and anyone occupying the Property after
demand made for possession thereof shall be guilty of forcible detainer and
shall be subject to eviction and removal, forcible or otherwise, with or
without process of law, and all damages by reason thereof are hereby
expressly waived to the extent permitted by law.
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(h) Should any Event of Default occur hereunder, any expenses
incurred by Notes Trustee in prosecuting, resolving, or settling the claim of
Notes Trustee shall become an additional "liability" of the Obligor and part
of the Indebtedness secured hereby.
(i) The purchase money proceeds or avails of any sale made under or
by virtue of this Security Instrument, together with any other sums which
then may be held by notes Trustee under this Security Instrument, whether
under the provisions of this Section 19 or otherwise, shall be applied in
accordance with the laws of Nevada, and to the extent not inconsistent, as
follows.
(A) first, to the payment or reimbursement of the Notes Trustee for
all costs and expenses of such suit or suits or other enforcement activities
of the Notes Trustee, including, but not limited to, the costs of
advertising, sale and conveyance, including attorneys', solicitors' and
stenographers' fees, if permitted by law, outlays for documentary evidence
and the cost of such abstract, examination of title and title report;
(B) second, to the extent proceeds remain after the application
pursuant to preceding clause (A), to reimburse the Notes Trustee for all
moneys advanced by the Notes Trustee, if any, for any purpose authorized in
this Security Instrument with interest at the default rate specified in the
Notes;
(C) third, to the extent proceeds remain after the application
pursuant to preceding clause (B), an amount equal to the outstanding
Indebtedness owed to the Holders shall be paid to the Notes Trustee for the
benefit of the Holders; and
(D) fourth, to the extent remaining after the application pursuant to
the proceeding clauses (A), (B) and (C), to the Obligor or to whomever may be
lawfully entitled to receive such payment.
(j) The Obligor shall pay all costs and expenses, including without
limitation costs of title searches and title policy commitments, court costs
and reasonable attorneys' fees, incurred by Notes Trustee in enforcing
payment and performance of the Indebtedness or in exercising the rights and
remedies of Notes Trustee hereunder. All such costs and expenses shall be
secured by this Security Instrument and by all other lien and security
documents securing the Indebtedness. In the event of any court proceedings,
court costs and attorneys' fees shall be set by the court and not by jury and
shall be included in any judgment obtained by Notes Trustee.
(k) In any action by Notes Trustee to recover a deficiency judgment
for any balance due under the Notes upon the foreclosure of this Security
Instrument or in any action to recover the Indebtedness or Indebtedness
secured hereby, and as a material inducement to making the loan evidenced by
the Notes, the Obligor acknowledges and agrees that the successful bid amount
made at any judicial or non-judicial foreclosure sale, if any, shall be
conclusively deemed to constitute the fair market value of the Property, that
such bid amount shall be binding against the Obligor in any proceeding
seeking to determine or contest the fair market value of the Property. The
Obligor hereby waives and relinquishes any right to have the fair market
value of the Property determined by a judge or jury in any action seeking a
deficiency judgment or any
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action on the Indebtedness secured hereby, including, without limitation, a
hearing to determine fair market value.
(l) Upon any sale made under or by virtue of this Section 19, whether
made under the power of sale herein granted or under or by virtue of judicial
proceedings or of a judgment or decree of foreclosure and sale, Lender may
bid for and acquire the Property or any part thereof and in lieu of paying
cash therefor may make settlement for the purchase price by crediting upon
the Indebtedness of Borrower secured by this Security Instrument the gross
sales price.
21. The Notes Trustee, in making any payment herein and hereby
authorized in the place and stead of the Obligor (a) relating to taxes,
assessments, water rates, sewer rentals and other governmental or municipal
charges, fines, impositions or liens asserted against the Property, may do so
according to any bill, statement or estimate procured from the appropriate
public authority without inquiry into the validity thereof; or (b) relating
to any adverse title, lien, statement of lien, encumbrance, claim or charge,
shall be the sole judge of the validity of same; or (c) otherwise relating to
any purpose herein and hereby authorized, but not enumerated in this section,
may do so whenever, in its good faith judgment and discretion, such payment
shall seem necessary or desirable to protect the full security intended to be
created by this Security Instrument. In connection with any such payment, the
Notes Trustee, at its option, may and is hereby authorized to obtain a
continuation report of title prepared by a title insurance company, the cost
and expenses of which shall be repayable by the Obligor upon demand and shall
be secured hereby.
22. The Obligor agrees, without affecting the liability of any person
for payment of the Indebtedness or affecting the lien of this Security
Instrument upon the Property or any part thereof (other than persons or
property explicitly released as a result of the exercise by the Notes Trustee
of its rights and privileges hereunder), that the Notes Trustee, without
notice, and without regard to the consideration, if any, paid therefor, and
notwithstanding the existence at that time of any inferior liens thereon, may
release as to itself and this Security Instrument any part of the security
described herein or any person liable for any indebtedness secured hereby,
without in any way affecting the priority of the lien of this Security
Instrument to the full extent of the Indebtedness remaining unpaid hereunder
upon any part of the security not expressly released and may agree with any
party obligated on the Indebtedness or having any interest in the security
described herein to extend the time for payment of any part or all of the
Indebtedness secured hereby. Such agreement shall not, in any way, release or
impair the lien hereof, but shall extend the lien hereof as against the title
of all parties having any interest in such security which interest is subject
to such lien. In the event the Notes Trustee: (a) releases, as aforesaid, any
part of the security described herein or any person liable for any
indebtedness secured hereby, (g) grants an extension of time for any payments
of the debt secured hereby, (c) takes other or additional security for the
payment thereof, or (d) waives or fails to exercise any right granted herein,
in the Notes or in any related agreement, no such act or omission shall
release the Obligor, subsequent purchasers of all or any part of the
Property, any maker or surety of the Notes or any party to this Security
Instrument or any related agreement under any covenant therein, or preclude
the Notes Trustee from exercising any right, power or privilege herein
granted or intended to be granted in the event of any other default then made
or any subsequent default.
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23. If at any time the United States of America shall require
internal revenue stamps to be affixed to any of the Notes or any other
Indebtedness, the Obligor will pay (or cause the Borrower, if the Obligor is
not the Borrower) for the same with any interest or penalties imposed in
connection herewith.
24. To the extent services are required of the Notes Trustee's
counsel after the date hereof, which are normally incident to the closing,
amendment, alteration, and enforcement of this Security Instrument, and all
provisions herein contained, the Obligor shall, to the extent permitted by
law, pay the reasonable fees therefor, promptly upon the rendering of such a
bill and delivery thereof to the Obligor.
25. The Obligor agrees at all times to cause this Security
Instrument, and each amendment or modification hereof or supplement hereto,
and all assignments of leases, to be recorded, registered and filed, and kept
recorded, registered and filed, in such manner and in such places as
appropriate, and shall comply with all applicable statutes and regulations in
order to establish, preserve and protect the security and priority of this
Security Instrument, and such assignments and the rights of the Notes Trustee
thereunder. The Obligor shall pay, or cause to be paid, all taxes, fees and
other charges incurred in connection with such recording, registration,
filing and compliance.
26. The Obligor acknowledges that it has received from the Notes
Trustee without charge a true and correct copy of this Security Instrument.
27. The Notes Trustee and its successors and assigns shall be
entitled to all of the benefits of the indemnification provisions of the Trust
Indenture.
28. To the extent permitted by law with respect to the Indebtedness
secured hereby or any renewals or extensions thereof, the Obligor waives and
renounces any and all homestead and exemption rights, as well as the benefit
of all valuation and appraisement privileges, and also moratoriums under or
by virtue of the constitution and laws of the jurisdiction in which the
Property is located or any other state or of the United States, now existing
or hereafter enacted.
29. All the covenants hereof shall run with the land. Nothing herein
contained nor any transaction related hereto shall be construed or shall so
operate, either presently or prospectively, to require the Obligor to pay
interest at a rate greater than is now lawful in such case to contract for,
but shall require payment of interest only to the extent of such lawful rate.
30. The Obligor shall execute, acknowledge and deliver any and
all such further acts, conveyances, documents, mortgages and assurances as
the Notes Trustee may reasonably require for accomplishing the purpose
hereof forthwith upon the request of the Notes Trustee, whether in writing
or otherwise. The Obligor, within ten days upon request by mail, shall
furnish a written statement duly acknowledged of the amount due upon this
Security Instrument and the Indebtedness (both unpaid principal and accrued
interest) and whether any offset or defenses exist against the
Indebtedness, and any other information which might reasonably be requested
in connection with the sale of the Indebtedness, or any portion thereof or
interest
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therein, to any third party, or an audit of the Notes Trustee, and which may
be relied on for such purposes.
31. Wherever notices may appropriately be given under this Security
Instrument, such notices shall be in writing and shall always be treated as
having adequately been given if:
(a) when intended for the Obligor, five days after dispatch by
Certified Mail return receipt requested, addressed to the mailing address, as
set out herein or to such other address or to such other person, as the
Obligor may from time to time, designate in writing; or
(b) when intended for the Notes Trustee, five days after dispatch by
Certified Mail return receipt requested, addressed to the mailing address of
the Notes Trustee as set out herein or to such other address or to such other
person as the Notes Trustee may from time to time designate in writing.
32. Any of the following occurrences or acts shall constitute an
event of default under this Security Instrument ("Event of Default"): (a) the
Company fails to pay any of the Notes or any installment thereof or interest
thereon when due or when declared due, subject to any applicable grace period
provided therein; (b) an Event of Default under and as defined in the Trust
Indenture shall have occurred; (c) the Obligor (regardless of the pendency of
any bankruptcy, reorganization, receivership, insolvency or other
proceedings, at law, in equity or before any administrative tribunal, which
have or might have the effect of preventing the Obligor from complying with
the terms of this Security Instrument), shall fail to observe or perform any
of the Obligor's covenants, agreements or obligations under this Security
Instrument and, other than defaults in the observance or performance of its
obligations under Section __ hereof, such failure shall continue for 30 days
after notice; (d) a default shall occur and continue to exist after the
expiration of any applicable grace period under any other document, agreement
or instrument between the Company or any Subsidiary Guarantor and the Notes
Trustee or any Holders, with respect to any of the Indebtedness; (e) any
representation contained herein or in the Trust Indenture or the Notes or
made (or deemed made) by the Company or any Subsidiary Guarantor to the Notes
Trustee or any of the Holders in connection with any of the Indebtedness
shall prove to be untrue in any material respect on the date as of which made
or deemed made; (f) the Company or any Subsidiary Guaranty shall file a
voluntary petition in bankruptcy or be adjudicated a bankrupt or insolvent,
or the Company or any Subsidiary Guarantor shall file any petition or answer
seeking or acquiescing in any reorganization, arrangement, composition,
readjustment, liquidation, dissolution or similar relief for itself under any
present or future federal, state or other statute, law or regulation relating
to bankruptcy, insolvency or other relief for debtors or protection for
creditors, or the seeking, or the consenting by the Company or any Subsidiary
Guarantor to or acquiescing in the appointment of any trustee, receiver,
conservator or liquidator of the Company or any Subsidiary Guarantor, as the
case may be, or of all or any substantial part of the Property or any or all of
the rents, issues or profits thereof, or the making of any general assignment
for the benefit of creditors, or the admission in writing of its inability to
pay its debts generally as they become due, or the entry by a court of competent
jurisdiction of any order, judgment or decree, which is not dismissed within 60
days thereafter, approving a
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petition filed against the Company or any Subsidiary Guarantor seeking any
reorganization, arrangement, composition, readjustment, liquidation,
dissolution or similar relief under any present or future Federal, state or
other statute, law or regulation relating to bankruptcy, insolvency or other
relief for debtors or protection for creditors, or the appointment, which
appointment is not dismissed within 60 days thereafter, of any trustee,
receiver, conservator or liquidator of the Company or any such Subsidiary, as
the case may be, or of all or any substantial part of the Property or of all
of the rents, issues and profits thereof without the consent or acquiescence
of the Notes Trustee.
33. Upon any Event of Default or any default by the Obligor as
provided herein or in any other instrument evidencing or securing any of the
Indebtedness then, in any of said events, at the option of the Notes Trustee
(or, as may be provided in any instrument pursuant to which any such
Indebtedness is created, at the option of any holder of any such
Indebtedness), the whole or any applicable portion of the Indebtedness
secured hereby shall become immediately due and payable, although the period
specified for the payment thereof may not have expired, anything hereinbefore
or in the Notes contained to the contrary notwithstanding.
34. The obligations of the Obligor under this Security Instrument
shall be absolute and unconditional and shall remain in full force and effect
without regard to, and shall not be released, suspended, discharged,
terminated or otherwise affected by, any circumstance or occurrence
whatsoever, including, without limitation:
(A) any renewal, extension, amendment or modification of, or addition
or supplement to or deletion from any document pertaining to the
Indebtedness, or any other instrument or agreement referred to therein, or
any assignment or transfer of any thereof;
(B) any waiver, consent, extension, indulgence or other action or
inaction under or in respect of any such agreement or instrument or this
Security Instrument except as expressly provided in such renewal, extension,
amendment, modification, addition, supplement, assignment or transfer;
(C) any furnishing of any additional security to the Notes Trustee or
its assignee or any acceptance thereof or any release of any security by the
Notes Trustee or its assignee;
(D) any limitation on any party's liability or obligations under any
such instrument or agreement or any invalidity or unenforceability, in whole
or in part, of any such instrument or agreement or any term thereof; or
(E) any bankruptcy, insolvency, reorganization, composition,
adjustment, dissolution, liquidation or other like proceeding relating to the
Company or any Subsidiary Guarantor, or any action taken with respect to this
Security Instrument by any trustee or receiver, or by any court, whether or
not the Obligor shall have notice or knowledge of any of the foregoing.
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35. Any provision of this Security Instrument which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
36. THIS SECURITY INSTRUMENT AND THE RIGHTS AND OBLIGATIONS OF THE
OBLIGOR AND THE NOTES TRUSTEE HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH
AND BE GOVERNED BY THE LAW OF THE STATE OF NEVADA.
37. When the Indebtedness has been paid in full, this Security
Instrument shall terminate, and the Notes Trustee, at the request and expense
of the Obligor, will execute and deliver to the Obligor a proper instrument
or instruments acknowledging the satisfaction and termination of this
Security Instrument.
38. None of the terms and conditions of this Security Instrument may
be changed, waived, modified or varied in any manner whatsoever unless in
writing duly signed by the Obligor and the Notes Trustee.
39. The Obligor and the Notes Trustee each hereby irrevocably waives
all right to a trial by jury in any action, proceeding or counterclaim
arising out of or relating to this Security Instrument or the transactions
contemplated hereby.
40. IT IS SPECIFICALLY AGREED that time is of the essence with
respect to this Security Instrument and that the waiver of the rights or
options, or obligations secured hereby, shall not at any time thereafter be
held to be abandonment of such rights. Notice of the exercise of any right or
option granted to the Notes Trustee herein, or in the Indebtedness secured
hereby, is not required to be given.
41. Where not inconsistent with the above, the following covenants,
Nos. 1; 2 (full replacement value); 3; 4 (default rate specified in the
Notes); 5; 6; 7 (a reasonable percentage); 8 and 9 of Nevada Revised Statute
Section 107.030 are hereby adopted and made a part of this Security
Instrument.
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Exhibit A
PARCEL I.
---------
The North Half (N 1/2) of the Northeast Quarter (NE 1/4) of the Southeast
Quarter (SE 1/4) of the Northeast Quarter (NE 1/4) of Section 25, Township
21 South, Range 60 East, M.D.B. & M., in the County of Xxxxx, State of
Nevada, described as follows:
EXCEPTING THEREFROM that portion of said land as conveyed to the County of
Xxxxx by those certain Xxxxx, Bargain, Sale Deeds recorded May 16, 1991 in
Book 910516, as Document No. 01004 of Official Records, and January 13,
1997 in Book 970113, as Document No. 00958, of Official Records; and
ALSO EXCEPTING THEREFROM, the following described land:
That portion of the North Half (N 1/2) of the Southeast Quarter (SE 1/4) of
the Northeast Quarter (NE 1/4) of Section 25, Township 21 South, Range 60
East, Mount Diablo Meridian, in the County of Xxxxx, State of Nevada, being
more particularly described as follows:
COMMENCING at the Northeast Corner (NE Cor) of the Southeast Quarter (SE
1/4) of the Northeast Quarter (NE 1/4) of said Section 25, also being the
centerline intersection of Decatur Boulevard (60 feet wide from centerline)
and Reno Avenue (30 feet wide from centerline):
Thence along the East line of the Northeast Quarter (NE 1/4) of said Section
25 and the centerline of said Decatur Boulevard, South 00 DEG. 15'04" East,
60.89 feet;
Thence leaving said East line and centerline, South 89 DEG. 44'56" West,
60.00 feet to the Westerly right of way of said Decatur Boulevard and the
POINT OF BEGINNING;
Thence along said Westerly right of way, South 00 DEG. 15'04" East, 148.32
feet;
Thence leaving said Westerly right of way, South 89 DEG. 44'56" West, 165.00
feet;
Thence North 00 DEG. 15'04" West 163.88 feet to the Southerly right of way of
said Reno Avenue;
Thence along said Southerly right of way, North 85 DEG. 52'01" East, 138.63
feet to the beginning of a curve concave to the Southwest having a radius
of 25.00 feet;
Thence Southeasterly along said curve, 40.96 feet through a central angle
of 93 DEG. 52'55" to the said Westerly right of way of Decatur Boulevard
and the POINT OF BEGINNING FOR THE END OF THIS DESCRIPTION.
PARCEL II:
----------
The Southwest Quarter (SW 1/4) of the Northeast Quarter (NE 1/4) of the
Southeast Quarter (SE 1/4) of the Northeast Quarter (NE 1/4) of Section 25,
Township 21 South, Range 60 East, M.D.B. & M., Xxxxx County, Nevada.
EXCEPTING THEREFROM that portion of said land as conveyed to the County of
Xxxxx by that certain Xxxxx, Bargain, Sale Deed recorded February 10, 1997
in Book 970210, as Document No. 00774 of Official Records.
PARCEL III:
-----------
The Southeast Quarter (SE 1/4) of the Northeast Quarter (NE 1/4) of the
Southeast Quarter (SE 1/4) of the Northeast Quarter (NE 1/4) of Section 25,
Township 21 South, Range 60 East, M.D.B. & M., Xxxxx County, Nevada.,
described as follows:
EXCEPTING THEREFROM the interest in and to the East Fifty (50) feet thereof
as disclosed by Resolution of Acquisition of Right-of-Way, recorded
December 22, 1972, as Document No. 247817 of Official Records, Xxxxx
County, Nevada.
FURTHER EXCEPTING THEREFROM that portion of said land as conveyed to the
County of Xxxxx by that certain Xxxxx, Bargain, Sale Deed recorded February
10, 1997 in Book 970210, as Document No. 00773 of Official Records.
IN WITNESS WHEREOF, the Obligor has caused this Security Instrument
to be executed and delivered as of the date first set forth above.
EPIC RESORTS - WESTPARK RESORT, LLC,
a Delaware limited liability company,
By /s/ X. X. Xxxxxxx
-------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: President
ATTEST:
/s/ Xxxxx X. Xxxxx
-----------------------
Name: Xxxxx X. Xxxxx
Title: Executive Assistant
STATE OF PENNSYLVANIA
COUNTY OF XXXXXXXXXX
This instrument was acknowledged before me on July 6, 1998 by
Xxxxxx X. Xxxxxxx as PRESIDENT of EPIC RESORTS-WESTPARK RESORT,
LLC., a Delaware limited liability company.
/s/ Xxxxxxx X. Xxxxx
-------------------------------------
NOTARY PUBLIC
My commission expires:
Notarial Seal
Xxxxxxx X. Xxxxx, Notary Public
Narberth Boro, Xxxxxxxxxx County
My Commission Expires April 16, 2001
Member, Pennsylvania Association of Notaries
