EXHIBIT 10.51
KENNECOTT URANIUM COMPANY
Mortgagor
and
KENNECOTT ENERGY COMPANY
Mortgagee
------------------------------
MORTGAGE,
SECURITY AGREEMENT,
FINANCING STATEMENT AND
ASSIGNMENT OF PROCEEDS,
RENTS AND LEASES
------------------------------
Dated as of June 23, 1997
This instrument affects real and personal property situated in the State of
Wyoming, in Fremont and Sweetwater Counties.
A carbon, photographic or other reproduction of this instrument is sufficient as
a financing statement. This instrument contains after-acquired property
provisions. This instrument secures payment of obligations undertaken by the
Mortgagor in a principal amount of U.S.$16,000,000, together with interest
thereon. This instrument covers proceeds of collateral. This instrument covers
minerals and other substances of value which may be extracted from the earth and
which will be financed at the mine portal of the mines located on the properties
described in Exhibit A hereto. This financing statement is to be filed for
record in the real estate records of the county records of Fremont and
Sweetwater Counties. Mortgagor is the record owner of the real estate as set
forth in Exhibit A attached hereto. The Mortgagee is not a seller or purchase
money lender of the collateral covered by this financing statement.
For purposes of recording this instrument as a financing statement, Kennecott
Uranium Company is the Debtor and Kennecott Energy and Coal Company is the
Secured Party.
RECORD AND RETURN TO:
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
EXHIBIT 10.51
TABLE OF CONTENTS
PAGE
ARTICLE 1 GRANT OF SECURITY INTERESTS...................................1
1.1 Grant of Security Interests...................................1
1.2 Obligations Secured...........................................3
1.3 Maturity......................................................3
ARTICLE 2 OWNERSHIP CONDITION, ETC. OF MORTGAGED PROPERTY...............4
2.1 [Intentionally omitted].......................................4
2.2 Recordation...................................................4
2.3 Payment of Impositions, etc...................................4
2.4 Maintenance of Existence......................................4
2.5 Compliance with Laws; Permits.................................4
2.6 Adverse Possession............................................5
2.7 Records and Inspection........................................5
2.8 Defense of Title..............................................5
2.9 Liens.........................................................5
2.10 Maintenance of Ownership of Property..........................5
2.11 No Claims Against Mortgagee, etc..............................5
2.12 Assignment of Rents...........................................6
2.13 Acquired Property Subject to Lien.............................6
ARTICLE 3 INSURANCE: DAMAGE, DESTRUCTION OR TAKING, ETC.................7
3.1 Insurance.....................................................7
3.2 Damage, Destruction or Taking; Mortgagor to
Give Notice; Assignment of Awards.............................8
3.3 Application of Proceeds.......................................9
3.4 Total Taking and Total Destruction............................9
3.5 Restoration..................................................10
ARTICLE 4 ENVIRONMENTAL INDEMNIFICATION................................10
4.1 Indemnification..............................................10
4.2 Inspection...................................................11
4.3 Actions by Mortgagee.........................................11
4.4 Intervention.................................................12
4.5 Nonexclusivity...............................................12
ARTICLE 5 EVENTS OF DEFAULT; REMEDIES, ETC.............................12
5.1 Events of Default; Declaration of Note Due...................12
5.2 Legal Proceedings; Foreclosure; Rescission...................14
5.3 Power of Sale................................................14
5.4 Mortgagee Authorized to Execute Deeds, etc...................14
5.5 Purchase of Mortgaged Property by Mortgagee .................15
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EXHIBIT 10.51
5.6 Receipt a Sufficient Discharge to Purchaser..................15
5.7 Waiver of Appraisement, Valuation, etc.......................15
5.8 Sale a Bar Against Mortgagor.................................15
5.9 Note to Become Due on Sale...................................15
5.10 Application of Proceeds of Sale and Other Moneys.............15
5.11 Appointment of Receiver......................................16
5.12 Possession, Management and Income............................16
5.13 Right of Mortgagee to Perform Mortgagor's Covenants, etc.....17
5.14 Remedies, etc., Cumulative...................................17
5.15 Attorneys' Fees etc..........................................17
5.16 Provisions Subject to Applicable Law.........................17
5.17 No Waiver, etc...............................................17
5.18 Compromise of Actions, etc...................................18
ARTICLE 6 MISCELLANEOUS................................................18
6.1 Further Assurances...........................................18
6.2 Additional Security..........................................18
6.3 Release, Partial Release, etc................................18
6.4 Notices, etc.................................................18
6.5 Amendments and Waivers.......................................19
6.6 Expenses.....................................................19
6.7 [Intentionally Omitted] .....................................19
6.8 WAIVER OF JURY TRIAL.........................................20
6.9 Miscellaneous................................................20
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EXHIBIT 10.51
MORTGAGE, SECURITY AGREEMENT,
FINANCING STATEMENT AND
ASSIGNMENT OF PROCEEDS, RENTS AND LEASES
THIS MORTGAGE, SECURITY AGREEMENT, FINANCING STATEMENT AND ASSIGNMENT OF
PROCEEDS, RENTS AND LEASES is entered into and is effective as of the 23rd day
of June, 1997, by and between KENNECOTT URANIUM COMPANY, a Delaware corporation
("Mortgagor"), and KENNECOTT ENERGY COMPANY, a Delaware corporation
("Mortgagee").
IN CONSIDERATION of the matters herein set forth and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Mortgagor hereby covenants and agrees as follows:
ARTICLE 1
Grant of Security Interests
1.1 GRANT OF SECURITY INTERESTS. Mortgagor does hereby grant, mortgage,
pledge, assign, and convey to Mortgagee, and to its successors and assigns, for
the benefit and security of Mortgagee under and subject to the terms and
conditions herein set forth, the following property (the "Mortgaged Property"):
(a) All of Mortgagor's present or hereafter acquired right, title and
interest in and to the following:
(i) the patented and unpatented federal mining claims
(collectively, the "Mining Claims") described on Exhibit A,
(ii) the patented and unpatented federal millsite claims
(collectively, the "Millsite Claims") described on Exhibit A,
(iii) the mining or other leases (collectively, the "Leases")
described on Exhibit A hereto and made a part hereof, together with
(iv) all other unpatented federal mining claims and millsite
claims, mining or other leases, fee simple estates, surface estates,
mineral estates, royalty interests, overriding royalty interests and
net profit or other interests in real property covering, relating to
or affecting property located in Fremont and Sweetwater Counties,
Wyoming, constituting Mortgagor's interest in the Big Eagle and
Jackpot Mines and the Sweetwater Mill located in Fremont and
Sweetwater Counties, Wyoming
(the Mining Claims, the Millsite Claim, the Leases together with such other
property, rights, leases, claims and interests being collectively called the
"Claims"); including, without limitation,
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EXHIBIT 10.51
all relocations of, amendments to and patents or land exchanges obtained in lieu
of the Mining Claims and the Millsite Claims (which shall be included in the
definition of "Mining Claims" or "Millsite Claims", as the case may be); all
amendments to and replacements of the Leases (which shall be included in the
definition of "Leases"): all veins, lodes and ledges and all of the dips, spurs,
angles, pits, dumps, ponds, tailings, ▇▇▇▇▇ heaps, slag piles and stock piles
situate on the Claims or therein or appurtenant thereto; together with all of
the other minerals, ore, concentrate, core bar and refined metals, including,
without limitation all inventories of minerals, warehouse receipts or documents
of title covering the same (collectively, the "Minerals") in, on or under the
Claims (the Claims and the Minerals being collectively called the "Lands");
together with all surface rights, easements, rights-of-way, and all other rights
of Mortgagor to use, mine, remove and process the Minerals; and all additional
lands, leases, estates, after-acquired titles, mining claims, millsite claims
and access and development rights hereafter acquired by Mortgagor for use in
connection with the Lands;
(b) All of Mortgagor's present or hereafter acquired right, title and
interest in and to the following: (i) (collectively, the "Improvements"): all
buildings, structures, improvements and fixtures and any alterations thereto or
replacements thereof, now or hereafter located in, on or under, affixed or made
appurtenant to or erected on the Lands, and (ii) (collectively, the "Easements")
all easements, licenses, privileges, uses and rights-of-way now or hereafter
appurtenant to the Lands or the Improvements or used in connection therewith or
with the mining of the Minerals, including, without limitation, the easements
and rights of way described on Exhibit B hereto;
(c) All of Mortgagor's present or hereafter acquired right, title and
interest in and to the following (collectively, the "Water Rights"): all water
and water rights, together with all applications for water rights or
applications or permits for the use, transfer or change of water rights, ditch
and ditch rights, well and well rights, reservoir and reservoir rights, stock or
interest in irrigation or ditch companies appurtenant to the Lands and all other
rights to water for use at or in connection with the Lands or the Improvements,
or the mining of the Minerals, including, without limitation, those rights
listed on Exhibit C hereto;
(d) All of Mortgagor's present or hereafter acquired right, title and
interest in and to the following (collectively, the "Equipment"): the surface or
subsurface machinery, equipment, motor vehicles and other rolling stock,
facilities, structures and fixtures (as defined in accordance with applicable
law), supplies, inventory, fittings, appliances, apparatus, material, goods and
other articles of personal property or replacements thereof now or hereafter
located in, on or under, affixed to or installed on the Lands or the
Improvements or used or purchased for use in connection with the locating,
mining, production, treatment, storage, transportation, manufacture or sale of
the Minerals or the use or operation of the items listed above, the Lands or the
Improvements, including, without limitation, those items listed on Exhibit D
hereto;
(e) All of Mortgagor's present or hereafter acquired right, title and
interest in and to the following (collectively, the "Agreements"): (i) leases,
subleases, agreements, contracts, instruments, evidences of title (and any
claims or causes of action under or with respect to such
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EXHIBIT 10.51
evidences of title), access, operating, joint venture, mining partnership, or
other agreements relating to the development or operation of the Lands,
including, without limitation, the leases and agreements described on Exhibit E
hereto; and (ii) all permits, bonds and licenses, and all other documents,
accounts, contract rights and general intangibles now or hereafter arising out
of, used in connection with or relating to the locating, mining, production,
treatment, storage, transportation, manufacture or sale of the Minerals or the
use or operation of the Lands or the Improvements (all to the extent a security
interest may be granted therein under the terms thereof and applicable law);
(f) All claims, rights and causes of action in contract, tort or
otherwise in any way relating to or arising out of the acquisition of the
Mortgaged Property by Mortgagor;
(g) All accounts, contract rights, rents, revenues, bonuses,
royalties, payments, profits, issues, incomes, products, documents, instruments,
inventories, general intangibles, accessions, proceeds and other benefits, if
any, arising from any of the Mortgaged Property described in paragraphs (a)
through (f) of this section 1.1 (all to the extent a security interest may be
granted therein under the terms thereof and applicable law); and
(h) All proceeds of the conversion, voluntary or involuntary, of any
of the Mortgaged Property described in paragraphs (a) through (g) of this
section 1.1 into cash or liquidated claims, including, without limitation,
proceeds of insurance and condemnation awards.
Without limiting any of the other provisions of this Mortgage, Mortgagor
further expressly grants to Mortgagee, as secured party, a security interest in
all of those portions of the Mortgaged Property which are or may be subject to
the Wyoming Uniform Commercial Code provisions applicable to secured
transactions.
1.2 OBLIGATIONS SECURED. This Mortgage is executed, acknowledged and
delivered by Mortgagor to secure and enforce the following obligations (the
"Obligations") of Mortgagor:
(a) The obligations of Mortgagor to Mortgagee under the promissory
note, dated the 23rd day of June, 1997 in the principal amount of sixteen
million dollars (U.S.$16,000,000), (the "Note") together with interest thereon
at the rate and upon the terms provided in the Note;
(b) The other obligations of Mortgagor to Mortgagee to perform each
and every term, covenant and condition of the Note, together with the
obligations of Mortgagor to Mortgagee to perform each and every term, covenant
and condition of this Mortgage;
(c) All indebtedness, liabilities and obligations of Mortgagor to
Mortgagee arising pursuant to this Mortgage or the Note (including, without
limitation, all costs and expenses reasonably incurred by Mortgagee, including,
without limitation, all legal, engineering and consulting fees, made and arising
pursuant to this Mortgage or the Note or any part thereof, any renewal,
extension or change of or substitution for such obligations or any part thereof,
or
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EXHIBIT 10.51
the acquisition or perfection of the security therefor, whether such advances,
costs and expenses were made and incurred at the request of Mortgagor or
Mortgagee); and
(d) All renewals, extensions, amendments and changes of, or
substitutions for, all or any part of the Obligations described in paragraphs
(a) through (c) of this section 1.2.
1.3 MATURITY. The maturity date of the Note is June 23, 2010.
ARTICLE 2
OWNERSHIP CONDITION, ETC. OF MORTGAGED PROPERTY
2.1 [Intentionally omitted].
2.2 RECORDATION. Mortgagor, at its expense, will at all times cause this
Mortgage and any instruments amendatory hereof or supplemental hereto and any
instruments of assignment hereof or thereof (and any appropriate financing
statements or other instruments and continuations thereof with respect to any
thereof) to be recorded, registered and filed and to be kept recorded,
registered and filed, in such manner and in such places, and will pay all such
recording, registration, filing fees and other charges, and will take all such
further action and will comply with all such statutes and regulations as may be
required by law in order to establish, preserve, perfect and protect the lien of
this Mortgage as a valid and direct mortgage lien on and perfected security
interest in the Mortgaged Property of a priority at least equal to the priority
existing on the date hereof. Mortgagor will pay or cause to be paid, and will
indemnify Mortgagee in respect of, all taxes (including interest and penalties)
at any time payable in connection with the filing and recording of this Mortgage
and any and all supplements and amendments thereto. Mortgagor, at its expense,
will furnish to Mortgagee, upon request, but not more frequently than once in
every twelve month period, an opinion of counsel reasonably satisfactory to
Mortgagee, specifying the action taken by Mortgagor to comply with this section
2.2 since the date of this Mortgage or the last such request hereunder, or
stating that no such action is necessary.
2.3 PAYMENT OF IMPOSITIONS, ETC. Mortgagor also agrees that it will pay
or cause to be paid before the same would become delinquent and before any fine,
penalty, interest or cost may be added for non-payment, all taxes, assessments,
charges, and other governmental levies or payments, of every kind and nature
whatsoever, general and special, ordinary and extraordinary, unforeseen as well
as foreseen, which at any time may be assessed, levied, confirmed, imposed or
which may become a lien upon the Mortgaged Property, or any portion thereof, or
which are payable with respect thereto, or upon the rents, issues, income or
profits thereof, or on the occupancy, operation, use, possession or activities
thereof, whether any or all of the same be levied directly or indirectly or as
excise taxes or as income taxes (collectively, the "Impositions").
2.4 MAINTENANCE OF EXISTENCE. The Mortgagor will at all times preserve
and keep in full force and effect its existence, and rights and franchises
material to its business, and qualify
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EXHIBIT 10.51
and remain qualified as a foreign corporation in good standing in each
jurisdiction in which the nature of its activities or the character of the
properties it owns or leases makes such qualification necessary and in which the
failure to so qualify would have a materially adverse effect on the Mortgagor.
2.5 COMPLIANCE WITH LAWS; PERMITS. Mortgagor shall comply in all
material respects with all applicable laws, rules, regulations and orders
(including without limitation, all environmental laws), such compliance to
include, without limitation, paying before the same become delinquent, all taxes
imposed upon it or any of its properties or assets and obtain and keep in full
force and effect all required licenses, permits and approvals.
2.6 ADVERSE POSSESSION. Mortgagor shall take any and all such action as
may be necessary to prevent any third parties from acquiring any material
prescriptive easement upon, over, or across any part of the Mortgaged Property,
or from acquiring any material rights to or against the Mortgaged Property by
virtue of adverse possession.
2.7 RECORDS AND INSPECTION. Mortgagor shall keep adequate records and
books of account, in which complete entries will be made in accordance with
generally accepted accounting principals consistently applied, reflecting all
financial transactions of the Mortgagor. Mortgagor shall keep such additional
records as may be necessary to reflect its ownership and operation of the
Mortgaged Property and its activities thereon. Mortgagor shall permit any
authorized representatives of Mortgagee to inspect such books and records and
the Mortgaged Property and to make copies and to take extracts therefrom all at
such reasonable times and as often may be reasonably requested.
2.8 DEFENSE OF TITLE. Mortgagor shall defend, at its expense, title to
the Mortgaged Property and the lien and interest of Mortgagee thereon and
therein and maintain and preserve such lien and interest and keep this Mortgage
the first lien upon and prior perfected security interest in the Mortgaged
Property.
2.9 LIENS. Mortgagor shall not directly or indirectly create, incur,
assume or permit to exist any lien or encumbrance on or with respect to the
Mortgaged Property or assign or convey any right to receive the production,
proceeds or income therefrom except: (i) liens for taxes, assessments or other
governmental charges if the same shall not at the time be delinquent or
thereafter can be paid without penalty; (ii) statutory liens of landlords,
carriers, warehousemen, mechanics and materialmen incurred in the ordinary
course of business and satisfied or released prior to delinquency; and (iii)
liens incurred or deposits made in the ordinary course of business in connection
with workers' compensation unemployment insurance and other types of social
security or to secure (or to obtain letters of credit or surety or performance
bonds which secure) the performance of statutory obligations for reclamation or
which are required in connection with the obtaining of governmental licenses.
2.10 MAINTENANCE OF OWNERSHIP OF PROPERTY. Mortgagor shall not convey,
transfer, assign or encumber any interest in the Mortgaged Property or create or
allow to exist any interest
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EXHIBIT 10.51
in the Mortgaged Property held by any person other than the Mortgagor or
Mortgagee, except as provided in the Acquisition Agreement.
2.11 NO CLAIMS AGAINST MORTGAGEE, ETC. Nothing contained in this
Mortgage shall constitute any consent or request by Mortgagee, express or
implied, for the performance of any labor or services or the furnishing of any
materials or other property in respect of the Mortgaged Property or any part
thereof, or be construed to permit the making of any claim against Mortgagee in
respect of labor or services or the furnishing of any materials or other
property or any claim that any lien based on the performance of such labor or
services or the furnishing of any such materials or other property is prior to
the lien of this Mortgage.
2.12 ASSIGNMENT OF RENTS. The assignment of rents, issues, incomes,
products, accessions, proceeds and other benefits contained in section 1.1
(collectively, the "Benefits") shall constitute an absolute and present
assignment, subject, however, to the conditional permission given herein to
Mortgagor to collect and use such Benefits. Upon the occurrence and during the
continuance of an Event of Default, such permission shall be terminated. Such
assignment, including, without limitation, the termination of such conditional
permission upon the occurrence and during the continuance of an Event of
Default, shall be fully operative without any further action on the part of any
of Mortgagor or Mortgagee. All parties (the "Purchasers") producing, purchasing,
receiving or having in their possession any of the Benefits are authorized and
directed to treat and regard Mortgagee as the party entitled in Mortgagor's
place and stead to receive such Benefit; and said parties shall be fully
protected in so treating and regarding Mortgagee and shall be under no
obligation to see to the application by Mortgagee of any such Benefits received
by it. Mortgagee shall apply all of the Benefits received pursuant to this
section 2.12 to satisfaction of the indebtedness secured by this Mortgage.
Notwithstanding the foregoing, so long as a Purchaser shall not have received
notice that an Event of Default shall have occurred and be continuing hereunder,
such Purchaser shall be fully protected and may pay any such Benefit to the
Mortgagor. Mortgagee shall be entitled, at its option, upon the occurrence and
during the continuance of an Event of Default hereunder, to all Benefits from
the Mortgaged Property, whether or not Mortgagee takes possession of the
Mortgaged Property. Mortgagor hereby further grants to Mortgagee the right,
following and during the continuance of an Event of Default, at Mortgagee's
option, to enter upon and take possession of the Mortgaged Property for the
purpose of collecting the Benefits. The assignment of the Benefits and such
grant shall continue in effect until the indebtedness and other sums secured
hereby are paid, the execution of this Mortgage constituting and evidencing the
irrevocable consent of Mortgagor to the entry upon and taking possession of the
Mortgaged Property by Mortgagee pursuant to such grant, whether or not
foreclosure has been instituted.
2.13 ACQUIRED PROPERTY SUBJECT TO LIEN. All property at any time
acquired by Mortgagor and required by section 1.1 of this Mortgage to become
subject to the lien hereof, whether such property is acquired by exchange,
purchase, construction or otherwise, shall forthwith become subject to the lien
of this Mortgage without further action on the part of Mortgagor or Mortgagee.
Mortgagor, at its expense, will execute and deliver to Mortgagee (and will
record and file as provided in section 2.2) an instrument supplemental to this
Mortgage,
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EXHIBIT 10.51
reasonably satisfactory in substance and form to Mortgagee, whenever such an
instrument is, in the reasonable opinion of Mortgagee, necessary or desirable
under applicable law to subject to the lien of this Mortgage all right, title
and interest of Mortgagor in and to all property required by this Mortgage to be
subjected to the lien hereof and acquired by Mortgagor since the date of this
Mortgage or the date of the most recent supplemental instrument so subjecting
property to the lien hereof, whichever is later. Mortgagor shall give Mortgagee
written notice of each acquisition of Mining Claims, Millsite Claims (patented
or unpatented) or other real property within 15 days after each such
acquisition.
2.14 NET WORTH. Mortgagor shall maintain a positive consolidated
tangible net worth determined under generally accepted accounting principles as
in effect in the United States from time to time.
ARTICLE 3
INSURANCE: DAMAGE, DESTRUCTION OR TAKING, ETC.
3.1 INSURANCE.
3.1.1 RISKS TO BE INSURED. Mortgagor will, at its expense, maintain or
cause to be maintained with insurers reasonably acceptable to Mortgagee, (a)
all-risk insurance in amounts not less than 100% of the then full insurable
value (cost of repairing, replacing, constructing or reconstructing, whichever
is the least, with comparable materials) of the Improvements, as determined by
Mortgagor in accordance with generally accepted insurance practice reasonably
acceptable to Mortgagee, or, upon the request of Mortgagee, as determined at
Mortgagor's expense by the insurer or insurers or by an expert selected by
Mortgagee, (b) public liability, including bodily and personal injury and
property damage, insurance applicable to the Mortgaged Property in such amounts
as are usually carried by prudent persons operating similar properties in
Wyoming, but in any event not less than the amount of coverage maintained
immediately prior to the execution of this Agreement, (c) worker's compensation
insurance to the full extent required by applicable law for all employees of
Mortgagor engaged in any work on or about the Mortgaged Property and employer's
liability insurance in such amounts as are usually carried by prudent persons
operating similar properties in Wyoming, and (d) such other insurance
(including, without limitation, business interruption insurance) with respect to
the Mortgaged Property as is usually carried by persons operating similar
properties in Wyoming, in such amounts and against such insurable hazards as may
be available and as Mortgagee from time to time may reasonably require by
written notice to Mortgagor.
3.1.2 POLICY PROVISIONS. All insurance maintained by Mortgagor pursuant
to section 3.1.1, shall (a) (except for worker's compensation insurance) name
Mortgagor or its permitted assignee and Mortgagee as insureds, mortgagees and
loss payees as their respective interests may appear; (b) (except for worker's
compensation and public liability insurance) provide that the proceeds for any
losses shall be adjusted with the insurers by Mortgagor subject to the approval
of Mortgagee in the event the claimed loss shall exceed $5,000,000, and shall be
payable to
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EXHIBIT 10.51
Mortgagee and Mortgagor, or its permitted assignee, to be held and applied as
provided in section 3.3; (c) include effective waivers by the insurer of all
rights of subrogation against any named insured, the indebtedness secured by
this Mortgage and the Mortgaged Property and all claims for insurance
premiums-against Mortgagee; (d) provide that any losses shall be payable
notwithstanding (i) any act, failure to act or negligence of or violation of
warranties, declarations or conditions contained in such policy by any named
insured, (ii) the occupation or use of the Mortgaged Property for purposes more
hazardous than permitted by the terms thereof, (iii) any foreclosure or other
action or proceeding taken by Mortgagee pursuant to any provision of this
Mortgage, or (i) any change in title or ownership of the Mortgaged Property; (e)
provide that no cancellation, reduction in amount or material change in coverage
thereof shall be effective until at least 30 days after receipt by Mortgagee of
written notice thereof; and (f) be satisfactory in all other respects to
Mortgagee. Any insurance maintained pursuant to this section 3.1 may be
evidenced by blanket insurance policies covering the Mortgaged Property and
other properties or assets of Mortgagor, provided that any such policy shall
specify the portion, if less than all, of the total coverage of such policy that
is allocated to the Mortgaged Property and shall in all other respects comply
with the requirements of this section 3.1.
3.1.3 DELIVERY OF POLICIES, ETC. Mortgagor will deliver to Mortgagee,
promptly upon request, (a) duplicate originals of all policies evidencing all
insurance required to be maintained under section 3.1.1 (or, in the case of
blanket policies, certificates thereof by the insurers together with a
counterpart of each blanket policy), and (b) evidence as to the payment of all
premiums due thereon (with respect to public liability insurance policies, all
installments for the current year due thereon to such date), provided that
Mortgagee shall not be deemed by reason of their custody of such policies to
have knowledge of the contents thereof. Mortgagor will also deliver to
Mortgagee, promptly upon request, but not more frequently than once every twelve
months, Officers' Certificates setting forth the particulars as to all such
insurance policies and certifying that the same comply with the requirements of
this section, that all premiums due thereon have been paid and that the same are
in full force and effect. Mortgagor will also deliver to Mortgagee a new policy
as replacement for any expiring policy at least 30 days prior to the date of
such expiration. In the event Mortgagor shall fail to effect or maintain any
insurance required to be effected or maintained pursuant to the provisions of
this section 3.1, Mortgagor will indemnify Mortgagee against damage, loss or
liability resulting from all risks for which such insurance shall have been
effected or maintained. The obligations of Mortgagor to indemnify Mortgagee in
such a manner shall survive any discharge of this Mortgage and payment in full
of the Note.
3.1.4 SEPARATE INSURANCE. Mortgagor will not take out separate insurance
concurrent in form or contributing in the event of loss with that required to be
maintained pursuant to this section.
3.2 DAMAGE, DESTRUCTION OR TAKING; MORTGAGOR TO GIVE NOTICE; ASSIGNMENT
OF AWARDS. In case of (a) any damage to or destruction of the Mortgaged Property
or any part thereof, or (b) any taking (whether for permanent or temporary use)
of all or any part of the Mortgaged Property or any interest therein or right
accruing thereto, as the result of or in lieu or in anticipation of the exercise
of the right of condemnation or eminent domain, or a change of grade affecting
the
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EXHIBIT 10.51
Mortgaged Property or any part thereof (a "Taking"), or the commencement of any
proceedings or negotiations which might result in any such Taking, Mortgagor
will promptly give written notice thereof to Mortgagee, generally describing the
nature and extent of such damage or destruction or of such Taking or the nature
of such proceedings or negotiations and the nature and extent of the Taking
which might result therefrom, as the case may be. Mortgagee shall be entitled to
all insurance proceeds payable on account of such damage or destruction and to
all awards or payments allocable to the Mortgaged Property on account of such
Taking and Mortgagor hereby irrevocably assigns, transfers and sets over to
Mortgagee all rights of Mortgagor to any such proceeds, award or payment and
irrevocably authorize and empower Mortgagee, at their option, in the name of
Mortgagor or otherwise, to file and prosecute what would otherwise be
Mortgagor's claim for any such proceeds, award or payment and, to collect,
receipt for and retain the same for disposition in accordance with section 3.3
Mortgagor will pay all reasonable costs and expenses incurred by Mortgagee in
connection with any such damage, destruction or Taking and seeking and obtaining
any insurance proceeds, award or payment in respect thereof.
3.3 APPLICATION OF PROCEEDS. Mortgagee shall apply all amounts recovered
under any insurance policy required to be maintained by Mortgagor hereunder, and
all net awards received by it on account of any Taking in the following ways:
(a) so long as no Event of Default shall have occurred and be continuing,
released to Mortgagor for application to the cost of compliance with section
3.5, or (b) if an Event of Default has occurred and is continuing, (i) to
fulfill any of the covenants contained herein as Mortgagee may determine, or
(ii) to be held as additional cash collateral hereunder to be invested in
short-term United States government securities selected by Mortgagor with the
consent of Mortgagee.
3.4 TOTAL TAKING AND TOTAL DESTRUCTION. In case of (a) a Taking of the
entire Mortgaged Property, or (b) a Taking of less than the entire Mortgaged
Property, or any material damage to or destruction of the Mortgaged Property, in
either case which, in the good faith judgment of Mortgagee, renders the
Mortgaged Property remaining after such Taking, damage or destruction, taken as
a whole, unsuitable for restoration for use as property of substantially the
same value, condition, character and general utility as the Mortgaged Property
prior to such Taking, damage or destruction (any such Taking being herein called
a "Total Taking" and any such damage or destruction being herein called a "Total
Destruction"), then the proceeds of insurance and the net awards received by
Mortgagee or Mortgagor on account of such Total Taking or Total Destruction
shall be applied by Mortgagee as follows:
FIRST: to the payment of the costs and expenses of the recovery
of such proceeds or awards (including, without limitation, attorneys'
fees) and any taxes, assessments or charges, prior to the lien of this
Mortgage, which Mortgagee may consider it necessary or desirable to pay;
SECOND: to the payment of any indebtedness secured by this
Mortgage, other than indebtedness with respect to the Note at the time
outstanding, which Mortgagee may consider it necessary or desirable to
pay;
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EXHIBIT 10.51
THIRD: to the payment of all amounts of principal, and interest
at the time outstanding on the Note (whether or not at the time due and
payable by reason of maturity or as an installment of combined principal
and interest or by reason of any prepayment requirement or by
declaration of acceleration or otherwise), including interest at the
rate per annum set forth in the Note for past due amounts (the "Default
Rate") on any overdue principal and (to the extent permitted under
applicable law) on any overdue interest; and in case such moneys shall
be insufficient to pay in full the amounts so due and unpaid upon the
Note at the time outstanding, then, FIRST, to the payment of all amounts
of interest at the time outstanding on the Note, and SECOND, to the
payment of all amounts of principal, at the time outstanding on the
Note.
FOURTH: the balance, if any, held by Mortgagee after payment in
full of all amounts referred to in subdivisions First, Second and Third
above, shall, unless a court of competent jurisdiction may otherwise
direct by final order not subject to appeal, be paid to or upon the
direction of Mortgagor or its permitted assignee.
3.5 RESTORATION. In case of any Taking (other than a Total Taking) or
any damage to or destruction of the Mortgaged Property or any part thereof
(other than a Total Destruction), Mortgagor will (to the extent such Taking,
damage or destruction is susceptible of replacement, repair or restoration)
commence or cause to be commenced, promptly and with due diligence, at its
expense, whether or not the insurance proceeds for such damage or destruction or
the award for such Taking shall be sufficient for such purpose, (a) the
replacement, repair or restoration of the Mortgaged Property as nearly as
practicable (in the case of a Taking, after giving effect to any reduction in
area caused thereby) to the value, condition, character and general utility
thereof immediately prior to such damage, destruction or Taking or (b) the
substitution for such Mortgaged Property or any part thereof of other property
(which shall upon such substitution become a part of the Mortgaged Property) of
at least the same value and general utility of such Mortgaged Property or part
thereof immediately prior to such damage, destruction or Taking.
ARTICLE 4
ENVIRONMENTAL INDEMNIFICATION
4.1 INDEMNIFICATION. Mortgagor shall defend, indemnify and hold
Mortgagee harmless from and against any and all environmental claims directly or
indirectly arising out of or resulting from any Hazardous Substance being
present or released in, on, around or potentially affecting any part of the
Mortgaged Property or the soil, vadose zone, groundwater or soil vapor on or
under the Mortgaged Property, including:
4.1.1 Any claim for such environmental claim asserted by any federal,
state, or local governmental agency, including the United States Environmental
Protection Agency and the Wyoming Department of Environmental Quality and
including any claim that Mortgagee is liable for any such environmental claim
asserted as an "owner" or "operator" of the Mortgaged Property under any law
relating to Hazardous Substances; and
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EXHIBIT 10.51
4.1.2 Any such environmental claim asserted against Mortgagee by any
person other than a governmental agency, including any person who may purchase
or lease all or any portion of the Mortgaged Property from Mortgagor, from
Mortgagee, or from any other purchaser or lessee; any person who may at any time
have any interest in all or any portion of the Mortgaged Property; any person
who may at any time be responsible for any cleanup costs or other environmental
claims relating to the Mortgaged Property; and any person claiming to have been
injured in any way as a result of exposure to any Hazardous Substance from or
located at the Mortgaged Property; and
4.1.3 Any such environmental claims which Mortgagee reasonably believes
at any time may be incurred to comply with any law, judgment, order, regulation
or regulatory directive relating to Hazardous Substances or which Mortgagee
reasonably believes at any time may be incurred to protect the public health or
safety; and
4.1.4 Any such environmental claims resulting from currently existing
conditions in, on, around or potentially affecting the Mortgaged Property,
whether known or unknown by Mortgagor or Mortgagee at the time this Mortgage is
executed, and any such indemnified costs resulting from the activities of
Mortgagor, Mortgagor's tenants, or any other person in, on, around or
potentially affecting the Mortgaged Property.
4.2 INSPECTION. Mortgagee, its contractors, agents and representatives
(hereinafter, "Site Reviewers") shall have the right at any reasonable time and
from time to time, upon prior notice, to enter upon and visit the Mortgaged
Property for the purposes of observing the environmental condition at the
Mortgaged Property, taking and removing soil or groundwater samples, and
conducting tests and/or site assessments on any part of the Mortgaged Property
(collectively, "Site Assessments") for the purpose of determining whether there
exists on the Mortgaged Property any environmental condition that could result
in any liability, cost, or expense to the owner, occupier, or operator of such
Mortgaged Property arising under any Environmental Laws. The Site Reviewers have
no duty, however, to conduct any Site Assessment, and no Site Assessment shall
impose any liability on any Site Reviewer. In no event shall the completion of
any Site Assessment be a representation that Hazardous Substances are or are not
present in, on, under or around the Mortgaged Property, or that there has been
or shall be compliance with any law, regulation or ordinance pertaining to
Hazardous Substances or any other governmental law. Neither Mortgagor nor any
other party is entitled to rely on any Site Assessment conducted by or on behalf
of Mortgagee, which Site Assessment shall be for the sole benefit and use of
Mortgagee. The Site Reviewers owe no duty of care to protect Mortgagor or any
other party against, or to inform Mortgagor or any other party of, any Hazardous
Substances or any other adverse condition affecting the Mortgaged Property.
Mortgagee shall avoid interfering with Mortgagor's use of the Mortgaged Property
in exercising any rights provided in this Section. The Site Reviewers are hereby
authorized to enter upon the Mortgaged Property for the purpose of conducting
Site Assessments. The Site Reviewers are further authorized to perform both
above and below the ground testing for environmental damage or the presence of
Hazardous Substances on the Mortgaged Property and such other tests on the
Mortgaged Property as may be necessary to conduct the site Assessments in the
reasonable
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EXHIBIT 10.51
opinion of the Site Reviewers, provided that in conducting such testing, the
Site Reviewers comply with the requirements of the Federal Mine Safety and
Health Act and all applicable health and safety laws of the State of Wyoming and
local authorities having jurisdiction and Mortgagor's reasonable safety
regulations while on the Mortgaged Property. Mortgagor will supply to the Site
Reviewers such historical and operational information regarding the Mortgaged
Property as may be reasonably requested by the Site Reviewers to facilitate the
Site Assessments and will make available for meetings with the Site Reviewers
appropriate personnel having knowledge of such matters. The cost of performing
such Site Assessments shall be paid by Mortgagor upon demand of Mortgagee if the
need for the Site Assessment arises from or relates to or confirms any release
of Hazardous Substances or noncompliance with or violation of Environmental
Laws. On request, Mortgagee shall make the results of such Site Assessments
fully available to Mortgagor provided that Mortgagor has fully reimbursed
Mortgagee for the cost of such Site Assessments.
4.3 ACTIONS BY MORTGAGEE. Mortgagee shall have the right, but not the
obligation, without in any way limiting Mortgagee's other rights and remedies
under the Note and this Agreement, to enter onto the Mortgaged Property or to
take such other actions as it deems necessary or advisable to clean up, remove,
resolve, or minimize the impact of, or otherwise deal with, any release of
Hazardous Substances on or affecting the Mortgaged Property or any presence of
Hazardous Substances on or affecting the Mortgaged Property that is not in
compliance with or is in violation of applicable Environmental Laws following
receipt of any notice from any person or entity asserting the existence of any
Hazardous Substances pertaining to the Mortgaged Property or any part thereof
that, if true, could result in an claim, order, notice, suit, imposition of a
lien on the Mortgaged Property, or other action and/or that, in Mortgagee's sole
opinion, could jeopardize Mortgagee's security under the Note and this
Agreement, if the Mortgagor, following written notice from Mortgagee shall fail
to promptly take reasonable action to prevent any ongoing or future release or
to remedy the effects of any such release, or to cause the presence of Hazardous
Substances on or affecting the Mortgaged Property to be in compliance with
applicable Environmental Laws, diligently prosecute the same to completion, and
provide satisfactory proof of such preventative or remedial measures. All
reasonable costs and expenses paid or incurred by Mortgagee in the exercise of
any such rights shall be secured by this Agreement and shall be payable by
Mortgagor upon demand.
4.4 INTERVENTION. Mortgagee shall have the right at any time to appear
in and to participate in, as a party if it elects, and be represented by counsel
of its own choice in, any action or proceeding in connection with any
Environmental Law that affects the Mortgaged Property. Upon demand by Mortgagee,
Mortgagor shall defend any investigation, action or proceeding involving any
matter covered by Mortgagor's obligations hereunder which is brought or
commenced against Mortgagee, whether alone or together with Mortgagor or any
other person, all at Mortgagor's own cost and by counsel reasonably acceptable
to Mortgagee in the exercise of its reasonable judgment. In the alternative,
Mortgagee may elect to conduct its own defense at the expense of Mortgagor.
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EXHIBIT 10.51
4.5 NONEXCLUSIVITY. Nothing in this Article shall be construed to limit
any claim or right which Mortgagee may otherwise have at any time against
Mortgagor or any other person arising from any source other than this Article,
including any claim for fraud, misrepresentation, waste, or breach of contract
other than the Note and this Mortgage, and any rights of contribution or
indemnity under federal, state or local environmental law or other applicable
law, regulation or ordinance.
ARTICLE 5
EVENTS OF DEFAULT; REMEDIES, ETC.
5.1 EVENTS OF DEFAULT; DECLARATION OF NOTE DUE.
(a) Events of Default" under the Note shall constitute events of
default hereunder and are herein called "Events of Default". Events of Default
shall also include:
(i) The breach or default by Mortgagor of or under any covenant,
warranty, agreement, representation, performance or requirement herein
contained or contained in the Note which continues at least thirty
(30) days after notice to Mortgagor, provided that if such breach or
default requires more than thirty (30) days to cure and Mortgagee
initiates such cure within such thirty (30) day period and diligently
pursues the same, Mortgagor shall have such additional time as may be
necessary to effect cure, but in no event may such additional time
exceed ninety (90) days.
(ii) The institution of any proceeding against the Mortgagor, the
Mortgaged Property, or any other property interest which is a
co-tenancy or a joint interest in any property which is wholly or
partially subject to the lien created hereunder in which forfeiture,
attachment, or replevin of any material asset of Mortgagor is sought
in the proceeding, unless such proceeding is dismissed within sixty
(60) days following its initiation.
(iii) The admission in writing by Mortgagor that it is unable to
pay its debts as they mature or that it is generally not paying its
debts as they mature.
(iv) The liquidation, termination, or dissolution of Mortgagor
under the laws of the state under which it is organized.
(v) The sale, merger, lease, exchange, conveyance, transfer,
mortgage, assignment, pledge or encumbrance of the Mortgaged Property,
either voluntarily or involuntarily, or the agreement to do so,
contrary to the provisions of the Mortgage without the prior written
consent of the Mortgagee being first obtained.
(vi) The filing of any petition or the commencement of any case or
proceeding by or against Mortgagor under any federal or state law
relating to insolvency, bankruptcy, or reorganization, unless such
petition and the case or proceeding initiated thereby is dismissed
within sixty (60) days from the date of such filing; or an
adjudication that Mortgagor is insolvent
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EXHIBIT 10.51
or bankrupt; or the entry of an order for relief under the United States
Bankruptcy Code with respect to Mortgagor; the filing of an answer by Mortgagor
admitting the allegations of any such petition; or the appointment of or the
taking of possession by a custodian, trustee or receiver for all or any material
assets of Mortgagor, unless such appointment is vacated or dismissed or such
possession is terminated within sixty (60) days from the date of such
appointment or commencement of such possession, but not later than five (5) days
before the proposed sale of any material assets of Mortgagor by such custodian,
trustee, or receiver, other than in the ordinary course of the business of
Mortgagor.
(vii) The insolvency of Borrower; or the execution by Borrower of
an assignment for the benefit of creditors; or the convening by
Borrower of a meeting of its creditors, or any class thereof, for the
purposes of effecting a moratorium upon or extension or composition of
its debts; or the failure of Borrower to generally pay its debts as
they mature.
(viii) The failure to place into production an economically viable
uranium mine on the Mortgaged Property by December 31, 2005.
(b) Upon the occurrence and during the continuance of any of the
Events of Default, and whether or not any amount due under the Note
has been declared due and payable pursuant to the Note, then and in
any such event Mortgagee may declare, by written notice to Mortgagor,
all indebtedness secured hereby, including, indebtedness accelerated
pursuant to the Note, to be due and payable upon the date specified in
such notice, and upon such date the same shall become due and payable,
together with interest accrued thereon, without presentment, demand,
protest, notice or other requirements of any kind, all of which are
hereby waived.
(c) Mortgagor will pay on demand all costs and expenses (including,
without limitation, attorneys' fees and expenses) incurred by or on behalf of
Mortgagee in enforcing this Mortgage or the Note or occasioned by any default or
Event of Default under this Mortgage.
(d) Upon the occurrence and during the continuance of an Event of
Default, interest at the Default Rate shall be due and payable on the principal
of, premium, if any, and (to the extent permitted by law) interest on the Note
at the time outstanding and all other indebtedness secured hereby.
5.2 LEGAL PROCEEDINGS; FORECLOSURE; RESCISSION. If an Event of Default
shall have occurred and be continuing, Mortgagee at any time may, at its
election, proceed at law or in equity or otherwise to enforce the payment of the
Note at the time outstanding in accordance with the terms hereof and thereof and
to foreclose the lien of this Mortgage as against all or any part of the
Mortgaged Property or proceed to take either of such actions, and to have the
same sold under the judgment or decree of a court of competent jurisdiction.
Mortgagee, from time to time before sale, may rescind any notice of breach and
election to sell by executing, delivering and causing to be recorded a written
notice of such rescission. The exercise by Mortgagee of such right of rescission
shall not constitute a waiver of any breach or default then existing or
subsequently occurring, or impair the rights of Mortgagee to execute and
deliver, as above
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EXHIBIT 10.51
provided, other notices of breach and election to sell, nor otherwise affect any
term, covenant or condition hereof or under any obligations secured hereby, or
any of the rights, obligations or remedies of the parties thereunder.
5.3 POWER OF SALE. If an Event of Default shall have occurred and be
continuing, Mortgagee may sell, assign, transfer and deliver the whole or, from
time to time, any part of the Mortgaged Property, or any interest in any part
thereof, for cash, on credit or for other property, for immediate or future
delivery, and for such price or prices and on such terms as Mortgagee in its
reasonable discretion may determine, or as may be required by law. The
provisions of this Mortgage shall be interpreted as broadly as possible to allow
Mortgagee the full advantage of all remedies to which Mortgagors under mortgages
are entitled under Wyoming law. Without in any way limiting the foregoing,
Mortgagor agrees that Mortgagee shall have the right following an Event of
Default hereunder to proceed with either a judicial foreclosure, or foreclosure
by advertisement pursuant to Section 34-4-101, et.seq., of the Wyoming Statutes
Annotated, as amended. In addition, with respect to any portion of the Mortgaged
Property that constitutes personal property governed by the Wyoming Uniform
Commercial Code, this Mortgage shall be construed broadly to give to Mortgagee
all of the rights and remedies to which secured parties are or may be entitled
under the Wyoming Uniform Commercial Code.
5.4 MORTGAGEE AUTHORIZED TO EXECUTE DEEDS, ETC. Mortgagor irrevocably
appoints Mortgagee, collectively, the true and lawful attorney of Mortgagor, in
its name and stead and on its behalf, for the purpose of effectuating any sale,
assignment, transfer or delivery for the enforcement hereof, whether pursuant to
power of sale, foreclosure by advertisement, judicial foreclosure or otherwise,
to execute and deliver all such deeds, bills of sale, assignments and other
instruments as Mortgagee may consider necessary or appropriate, with full power
of substitution, Mortgagor hereby ratifying and confirming all that its said
attorney or any substitute shall lawfully do by virtue hereof. Nevertheless, if
so requested by Mortgagee or any purchaser, Mortgagor will ratify and confirm
any such sale, assignment, transfer or delivery by executing and delivering to
Mortgagee or such purchaser all such proper deeds, bills of sale, assignments,
releases and other instruments as may be designated in any such request. If, in
the judgment of the Mortgagee, time permits, Mortgagee shall give prior notice
to the Mortgagor of the exercise of its powers hereunder, and give the Mortgagor
the opportunity to perform any act authorized hereby. The failure of Mortgagee
to comply with the preceding sentence shall not affect its powers hereunder or
in any way limit or prejudice its rights or remedies hereunder.
5.5 PURCHASE OF MORTGAGED PROPERTY BY MORTGAGEE. The Mortgagee or any
successor holder of the Note may be a purchaser of the Mortgaged Property or of
any part thereof or of any interest therein at any sale thereof, whether
pursuant to power of sale, foreclosure by advertisement, judicial foreclosure or
otherwise, and shall apply upon the purchase price thereof the indebtedness
secured hereby owing to such purchaser, to the extent of such purchaser's
distributive share of the purchase price. Any such purchaser shall, upon any
such purchase, acquire good title to the properties so purchased, free of the
lien of this Mortgage and free of all rights of redemption in Mortgagor.
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EXHIBIT 10.51
5.6 RECEIPT A SUFFICIENT DISCHARGE TO PURCHASER. Upon any sale of the
Mortgaged Property or any part thereof or any interest therein, whether pursuant
to power of sale, foreclosure by advertisement, judicial foreclosure or
otherwise, the receipt of the purchase money by Mortgagee or the officer making
the sale under judicial proceedings shall be a sufficient discharge to the
purchaser for the purchase money, and such purchaser shall not be obliged to see
to the application thereof.
5.7 WAIVER OF APPRAISEMENT, VALUATION, ETC. Mortgagor hereby waives, to
the fullest extent it may lawfully do so, the benefit of all appraisement,
valuation, stay, extension and redemption laws now or hereafter in force and all
rights of marshaling in the event of any sale of the Mortgaged Property or any
part thereof or any interest therein.
5.8 SALE A BAR AGAINST MORTGAGOR. Any sale of the Mortgaged Property or
any part thereof or any interest therein under or by virtue of this Mortgage,
whether pursuant to foreclosure by advertisement, judicial foreclosure or power
of sale or otherwise, shall forever be a perpetual bar against Mortgagor,
provided that nothing contained in this section 5.8 shall limit any rights of
Mortgagor against the Mortgagee resulting from any unlawful sale of the
Mortgaged Property or any part thereof or interest therein.
5.9 NOTE TO BECOME DUE ON SALE. Upon any sale by Mortgagee under or by
virtue of this Mortgage, whether pursuant to judicial foreclosure, foreclosure
by advertisement or power of sale or otherwise, the entire unpaid principal
amount of the Note at the time outstanding shall, if not previously declared due
and payable, immediately become due and payable, together with interest accrued
thereon, and all other indebtedness which this Mortgage by its terms secures.
5.10 APPLICATION OF PROCEEDS OF SALE AND OTHER MONEYS. The proceeds of
any sale of the Mortgaged Property or any part thereof or any interest therein
under or by virtue of this Mortgage, whether pursuant to judicial foreclosure,
foreclosure by advertisement, power of sale, or otherwise, shall, to the extent
allowed by law, be applied as follows:
FIRST: to the payment of all costs and expenses of such sale
(including, without limitation, the cost of evidence of title, the
costs and expenses, if any, of taking possession of, retaining custody
over, repairing, maintaining and preserving the Mortgaged Property or
any part thereof prior to such sale), all costs and expenses of any
receiver of the Mortgaged Property or any part thereof, and any taxes,
assessments, encumbrances, liens or charges, prior to the lien of, or
security interest created by, this Mortgage, which Mortgagee may
consider it necessary or desirable to pay;
SECOND: to the payment of any indebtedness secured by this
Mortgage, other than indebtedness with respect to the Note at the time
outstanding, which Mortgagee may consider it necessary or desirable to
pay;
THIRD: to the payment of all amounts of principal, and interest at
the time due and payable on the Note outstanding (whether due by
reason of maturity or as an installment
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EXHIBIT 10.51
of combined principal and interest or by reason of any prepayment
requirement or by declaration or acceleration or otherwise), including
interest at the Default Rate on any overdue principal and premium, if
any, and (to the extent permitted under applicable law) on any overdue
interest; and in case such moneys shall be insufficient to pay in full
the amounts so due and unpaid upon the Note at the time outstanding,
then, first, to the payment of all amounts of interest at the time due
and payable on the Note, and second, to the payment of all amounts of
principal and premium, if any, at the time due and payable on the Note;
and
FOURTH: the balance, if any, held by Mortgagee after payment in
full of all amounts referred to in subdivisions First, Second and
Third above, shall, unless a court of competent jurisdiction may
otherwise direct, be paid to or upon the direction of Mortgagor or its
permitted assignee.
5.11 APPOINTMENT OF RECEIVER. If an Event of Default shall have occurred
and be continuing, Mortgagee shall, as a matter of right, be entitled to the
appointment of a receiver for all or any part of the Mortgaged Property, whether
such receivership be incidental to a proposed sale of the Mortgaged Property or
otherwise.
5.12 POSSESSION, MANAGEMENT AND INCOME. If an Event of Default shall
have occurred and be continuing, Mortgagee may, but shall be under no obligation
to, immediately enter upon and take possession of the Mortgaged Property or any
part thereof by force, summary proceeding, ejectment or otherwise and may remove
Mortgagor and all other persons and any and all property therefrom and may hold,
operate, maintain, repair, preserve and manage the same and receive all
earnings, income, rents, issues and proceeds accruing with respect thereto or
any part thereof. Mortgagee shall be under no liability to Mortgagor for or by
reason of any such taking of possession, entry, removal or holding, operation or
management, except that any amounts so received by Mortgagee shall be applied to
pay all costs and expenses of so entering upon, taking possession of, holding,
operating, maintaining, repairing, preserving and managing the Mortgaged
Property or any part thereof, and any taxes, assessments or other charges prior
to the lien of this Mortgage which Mortgagee may consider it necessary or
desirable to pay, and any balance of such amounts shall be applied as provided
in section 5.10.
5.13 RIGHT OF MORTGAGEE TO PERFORM MORTGAGOR'S COVENANTS, ETC. If
Mortgagor shall fail to make any payment or perform any act required to be made
or performed hereunder, Mortgagee without notice to or demand upon Mortgagor,
and without waiving or releasing any obligation or default, may but shall be
under no obligation to) at any time thereafter make such payment or perform such
act for the account and at the expense of Mortgagor, and may enter upon the
Mortgaged Property for such purpose and take all such action thereon as, in
Mortgagee's opinion, may be necessary or appropriate therefor. No such entry and
no such action shall-be deemed an eviction of any lessee of the Mortgaged
Property or any part thereof. All sums so paid by Mortgagee and all costs and
expenses (including, without limitation, attorneys' fees and expenses) so
incurred, together with interest thereon at the Default Rate from the date of
payment or incurring, shall constitute additional indebtedness secured by this
Mortgage and shall be paid by
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EXHIBIT 10.51
Mortgagor to Mortgagee on demand. The final two sentences of Section 5.4 shall
apply to the exercise to the rights granted by this Section 5.13.
5.14 REMEDIES, ETC., CUMULATIVE. Each right, power and remedy of
Mortgagee provided for in this Mortgage or now or hereafter existing at law or
in equity or by statute or otherwise shall be cumulative and concurrent and
shall be in addition to every other right, power or remedy provided for in this
Mortgage or now or hereafter existing at law or in equity or by statute or
otherwise, and the exercise or beginning of the exercise by Mortgagee of any one
or more of the rights, powers or remedies provided for in this Mortgage or now
or hereafter existing at law or in equity or by statute or otherwise shall not
preclude the simultaneous or later exercise by Mortgagee of any or all such
other rights, powers or remedies.
5.15 ATTORNEYS' FEES ETC. Mortgagor shall pay to Mortgagee, on demand,
any costs and expenses, including reasonable attorneys' fees and expenses, paid
or incurred by Mortgagee in connection with the collection of any amount payable
by Mortgagor to Mortgagee hereunder or under the Note, whether or not any legal
proceeding is commenced hereunder or thereunder and whether or not any Event of
Default shall have occurred and is continuing, together with interest thereon at
the Default Rate from the date of payment or incurring by Mortgagee until paid
by Mortgagor.
5.16 PROVISIONS SUBJECT TO APPLICABLE LAW. All rights, powers and
remedies provided in this Mortgage may be exercised only to the extent that the
exercise thereof does not violate any applicable provisions of law and are
intended to be limited to the extent necessary so that they will not render this
Mortgage invalid, unenforceable or not entitled to be recorded, registered or
filed under the provisions of any applicable law. If any term of this Mortgage
or any application thereof shall be invalid or unenforceable, the remainder of
this Mortgage and any other application of such term shall not be affected
thereby.
5.17 NO WAIVER, ETC. No failure by Mortgagee to insist upon the strict
performance of any term hereof or thereof, or to exercise any right, power or
remedy consequent upon a breach hereof or thereof, shall constitute a waiver of
any such term or of any such breach. No waiver of any breach shall affect or
alter this Mortgage, which shall continue in full force and effect with respect
to any other then existing or subsequent breach. By accepting payment of any
amount secured hereby after its due date, Mortgagee shall not be deemed to waive
its right either to require prompt payment when due of all other amounts payable
hereunder or to declare a default for failure to effect such prompt payment.
5.18 COMPROMISE OF ACTIONS, ETC. Any action, suit or proceeding brought
by Mortgagee pursuant to any of the terms of this Mortgage or otherwise, and any
claim made by Mortgagee hereunder may be compromised, withdrawn or otherwise
dealt with by Mortgagee without any notice to or approval of Mortgagor.
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EXHIBIT 10.51
ARTICLE 6
MISCELLANEOUS
6.1 FURTHER ASSURANCES. Mortgagor, at its expense, will execute,
acknowledge and deliver all such instruments and take all such action as
Mortgagee from time to time may reasonably request for the better assuring to
Mortgagee the properties and rights now or hereafter subjected to the lien
hereof or assigned hereunder or intended so to be. Notwithstanding any other
provision of this Mortgage, Mortgagor hereby agrees that, without notice to or
the consent of Mortgagor, Mortgagee may file with the appropriate public
officials such financing statements or similar documents as are or may become
necessary to perfect and continue the perfection of the security interest
granted by this Mortgage.
6.2 ADDITIONAL SECURITY. Without notice to or consent of Mortgagor, and
without impairment of the lien and rights created by this Mortgage, Mortgagee
may accept (but Mortgagor shall not be obligated to furnish) from Mortgagor or
from any other person additional security for the Note at the time outstanding.
Neither the giving of this Mortgage nor the acceptance of any such additional
security shall prevent Mortgagee from resorting, first, to such additional
security, or, first, to the security created by this Mortgage, or concurrently
to both, in any case without affecting Mortgagee's lien and rights under this
Mortgage.
6.3 RELEASE, PARTIAL RELEASE, ETC. Upon receipt of all sums secured
hereby, Mortgagee shall release without warranty the property then held
hereunder. Mortgagee may, at any time and from time to time, without liability
therefor, release any part of the Mortgaged Property, consent to the making of
any map or plat thereof, grant an easement thereon, grant an extension or
subordinate the lien of this Mortgage, or enter into any other agreement in
connection with the Mortgaged Property.
6.4 NOTICES, ETC. All notices, demands, requests, consents, approvals
and other instruments under this Mortgage shall be in writing (including telex,
telecopy and telegraphic communication) and mailed, telexed, telegraphed or
delivered, at the following addresses or, as to any party, at such address as
shall be designated by such party in a written notice to the other parties.
If to Mortgagor: If to Mortgagee:
Kennecott Uranium Company Kennecott Energy Company
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ Attn: ▇▇▇▇ ▇. ▇▇▇▇▇▇-▇▇▇▇▇
Kennecott Energy Company ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇ P.O. Box 6001
505 South ▇▇▇▇▇▇▇▇ Avenue Magna, UT 84044-6001
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇ Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
19
EXHIBIT 10.51
With Mortgagee Copy to:
▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
All such notices and communications shall, when mailed by registered or
certified mail, or otherwise physically delivered, be effective when received or
delivered, addressed as aforesaid, and, when sent by ordinary mail, be effective
five days after the day on which deposited in the mails, addressed as aforesaid,
and when telexed or telecopied, be effective upon confirmation of transmission.
6.5 AMENDMENTS AND WAIVERS. This Mortgage, the Note, and any term hereof
or thereof may be amended, discharged or terminated and the observance of any
term of this Mortgage or the Note may be waived (either generally or in a
particular instance and either retroactively or prospectively) only by an
instrument in writing signed by Mortgagor and Mortgagee.
6.6 EXPENSES. Mortgagor will pay or cause to be paid (a) the cost of
filing and recording of this Mortgage and Uniform Commercial Code financing
statements and any other documents to be filed or recorded in connection with
the execution and delivery hereof or thereof; and (b) all taxes (including
interest and penalties) at any time payable in connection with the execution and
delivery of this Mortgage and any other instruments or agreements related hereto
or thereto, any amendment or waiver relating hereto or thereto, the issue and
acquisition of the Note and, where applicable, such filing and recording
(Mortgagor agreeing to indemnify Mortgagee in respect of such taxes, interest
and penalties.)
6.7 [Intentionally Omitted.]
6.8 WAIVER OF JURY TRIAL. MORTGAGOR HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES THE RIGHT TO TRIAL BY JURY IN ANY LEGAL OR EQUITABLE
ACTION, SUIT OR PROCEEDING ARISING OUT OF OR RELATING TO THIS MORTGAGE, THE NOTE
OR ANY TRANSACTION CONTEMPLATED HEREBY OR THEREBY.
6.9 MISCELLANEOUS. All the terms of this Mortgage shall apply to and be
binding upon (and those provisions of this Mortgage explicitly for the benefit
of Mortgagor shall be for the benefit of) the respective successors and assigns
of Mortgagor, and all persons claiming under or through Mortgagor or any such
successor or assign, and shall inure to the benefit of and be enforceable by
Mortgagee and its successors and assigns and any successor holders of any of the
Note at the time outstanding. The headings and table of contents in this
Mortgage are for convenience of reference only and shall not limit or otherwise
affect any of the terms hereof.
20
EXHIBIT 10.51
This Mortgage shall be construed and enforced in accordance with and governed by
the laws of the State of Wyoming, without giving effect to any choice or
conflict of law provision, either or the State of Wyoming or elsewhere, which
would cause the application of any laws other than of the State of Wyoming.
IN WITNESS WHEREOF, Mortgagor has caused this Mortgage to be duly
executed as of the day and year first above written.
KENNECOTT URANIUM COMPANY
By: /s/ ▇. ▇. ▇▇▇▇▇▇-▇▇▇▇▇
--------------------------------
Title: Director/Assistant Secretary
Attest: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
------------------------------------
Secretary
21
EXHIBIT 10.51
STATE OF UTAH )
: ss
COUNTY OF SALT LAKE )
The foregoing instrument was acknowledged before me by ▇. ▇. ▇▇▇▇▇▇-▇▇▇▇▇, the
Director/Asst. Secretary of Kennecott Uranium Company, a Delaware corporation,
who acknowledged to me that Kennecott Uranium Company executed the same on this
23rd day of June, 1997.
Witness my hand and official seal.
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------
Notary Public
My Commission Expires: Residing at:
▇▇-▇-▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇
[Seal]
22
EXHIBIT 10.51
EXHIBIT A
TO MORTGAGE, SECURITY AGREEMENT, FINANCING STATEMENT AND
ASSIGNMENT OF PROCEEDS, RENTS AND LEASES AMONG KENNECOTT
URANIUM COMPANY, MORTGAGOR AND KENNECOTT ENERGY COMPANY,
MORTGAGEE.
SCHEDULE OF CLAIMS
This Exhibit is not filed with this Form 10-K for the year ended May 31, 1997.
23
EXHIBIT 10.51
EXHIBIT B
TO MORTGAGE, SECURITY AGREEMENT, FINANCING STATEMENT AND
ASSIGNMENT OF PROCEEDS, RENTS AND LEASES AMONG KENNECOTT
URANIUM COMPANY, MORTGAGOR AND KENNECOTT ENERGY COMPANY,
MORTGAGEE.
SCHEDULE OF IMPROVEMENTS AND EASEMENTS
This Exhibit is not filed with this Form 10-K for the year ended May 31, 1997.
24
EXHIBIT 10.51
EXHIBIT C
TO MORTGAGE, SECURITY AGREEMENT, FINANCING STATEMENT AND
ASSIGNMENT OF PROCEEDS, RENTS AND LEASES AMONG KENNECOTT
URANIUM COMPANY, MORTGAGOR AND KENNECOTT ENERGY COMPANY,
MORTGAGEE.
SCHEDULE OF WATER RIGHTS
This Exhibit is not filed with this Form 10-K for the year ended May 31, 1997.
25
EXHIBIT 10.51
EXHIBIT D
TO MORTGAGE, SECURITY AGREEMENT, FINANCING STATEMENT AND
ASSIGNMENT OF PROCEEDS, RENTS AND LEASES AMONG KENNECOTT
URANIUM COMPANY, MORTGAGOR AND KENNECOTT ENERGY COMPANY,
MORTGAGEE.
SCHEDULE OF EQUIPMENT
This Exhibit is not filed with this Form 10-K for the year ended May 31, 1997.
26
EXHIBIT 10.51
EXHIBIT E
TO MORTGAGE, SECURITY AGREEMENT, FINANCING STATEMENT AND
ASSIGNMENT OF PROCEEDS, RENTS AND LEASES AMONG KENNECOTT
URANIUM COMPANY, MORTGAGOR AND KENNECOTT ENERGY COMPANY,
MORTGAGEE.
SCHEDULE OF AGREEMENTS
This Exhibit is not filed with this Form 10-K for the year ended May 31, 1997.
27