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MORTGAGE, SECURITY AGREEMENT, AND
ASSIGNMENT OF RENTS AND LEASES
from
THE INDUSTRIAL DEVELOPMENT BOARD
OF THE CITY OF ▇▇▇▇▇▇▇▇▇▇
and
ALCOOL, INC.
to
SOUTHTRUST BANK,
NATIONAL ASSOCIATION
dated as of February 1, 1999
This instrument prepared by
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇▇ & ▇▇▇▇▇▇, P.C.
P. O. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
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TABLE OF CONTENTS
Mortgage, Security Agreement and
Assignment of Rents and Leases
Page
Parties....................................................1
Recitals...................................................1
ARTICLE I
Definitions and Other Provisions
of General Application
Section 1.01 Definitions................................................2
Section 1.02 Effect of Headings and Table of Contents...................6
Section 1.03 Date of Mortgage...........................................6
Section 1.04 Separability Clause........................................6
Section 1.05 Governing Law..............................................6
Section 1.06 Counterparts...............................................6
ARTICLE II
Granting Clauses
I. The Project Equipment......................................6
II. Personal Property and Fixtures.............................7
III. Condemnation Awards and Insurance Proceeds.................7
IV. Special Funds..............................................7
V. Leases and Rents...........................................7
VI. Lease Agreement and Rights Thereunder......................8
VII. Other......................................................8
ARTICLE III
Representations and Warranties
Section 3.01 Board Representations and Warranties.......................9
Section 3.02 Alcool Representations and Warranties......................9
(i)
ARTICLE IV
Covenants of Alcool
Section 4.01 Payment of Taxes and Other Assessments....................10
Section 4.02 Insurance.................................................10
Section 4.03 Condemnation Awards.......................................11
Section 4.04 Waste, Demolition, Alteration or Replacement..............11
Section 4.05 Compliance by Alcool with Terms of Other
Financing Documents.......................................11
Section 4.06 Environmental Compliance..................................11
ARTICLE V
Transfer of, or Liens on, Collateral
Section 5.01 Limitation on Conveyance and Encumbrance..................13
ARTICLE VI
Defeasance
Section 6.01 Satisfaction of Mortgage..................................13
ARTICLE VII
Events of Default
Section 7.01 Defaults..................................................14
ARTICLE VIII
Rights of Bank Upon Default
Section 8.01 Acceleration of Indebtedness..............................15
Section 8.02 Operation of Collateral by Bank...........................15
Section 8.03 Judicial Proceedings; Right to Receiver...................16
Section 8.04 Foreclosure Sale..........................................16
Section 8.05 Project Equipment.........................................17
Section 8.06 Conveyance After Sale.....................................17
Section 8.07 Rents and leases..........................................18
Section 8.08 Application of Proceeds...................................18
Section 8.09 Multiple Sales............................................19
(ii)
Section 8.10 Waiver of Appraisement Laws...............................19
ARTICLE IX
Miscellaneous Provisions
Section 9.01 General Provisions Regarding Remedies.....................20
Section 9.02 Landlord-Tenant Relationship..............................20
Section 9.03 Enforceability............................................20
Section 9.04 Application of Payments...................................20
Section 9.05 Advances by Bank..........................................21
Section 9.06 Release or Extension by Bank..............................21
Section 9.07 Partial Payments..........................................21
Section 9.08 Addresses for Notices.....................................21
Section 9.09 Construction of Mortgage..................................22
Section 9.10 Limitation of Liability...................................22
Section 9.11 Cooperation with Alcool...................................23
Section 9.12 Collection and Disposition of Revenues and Receipts.......23
Section 9.13 Board to Keep Project Equipment Leased....................23
Testimonium...............................................24
Signatures and Acknowledgements...........................24
Exhibit A - Real Property
Exhibit B - Project Equipment
(iii)
MORTGAGE, SECURITY AGREEMENT, AND
ASSIGNMENT OF RENTS AND LEASES
THIS MORTGAGE, SECURITY AGREEMENT, AND ASSIGNMENT OF RENTS AND LEASES
dated as of February 1, 1999 is entered into by THE INDUSTRIAL DEVELOPMENT BOARD
OF THE CITY OF ▇▇▇▇▇▇▇▇▇▇, a public corporation under the laws of Alabama (the
"Board"), and ALCOOL, INC., a corporation organized under the laws of the State
of Alabama ("Alcool") for the benefit of SOUTHTRUST BANK, NATIONAL ASSOCIATION,
a national banking association (the "Bank").
Recitals
Alcool has requested that The Industrial Development Board of the City
of ▇▇▇▇▇▇▇▇▇▇ (the "Board") issue its $2,460,000 aggregate principal amount of
Variable Rate Industrial Development Revenue Bonds (Alcool, Inc. Project) Series
1999 (the "Bonds") in order to provide long-term financing for the cost of
acquiring certain manufacturing machinery and related personal property for use
by Alcool in the manufacture of aluminum heat exchanger coils (the "Project
Equipment"). The Project Equipment will be located in a building (the "Project
Building") owned by the Board and leased to Industrial Partners, a general
partnership ("Industrial Partners"), pursuant to a Lease Agreement dated
February 1, 1999 (the "Building Lease"). The Project Building will be subleased
by Industrial Partners to Alcool pursuant to a Lease Agreement dated December 9,
1998 (the "Building Sublease").
The Bonds will be issued pursuant to a Trust Indenture dated February
1, 1999 (the "Indenture") between the Board and SouthTrust Bank, National
Association (acting in such capacity, the "Trustee"). The Board will use the
proceeds of the Bonds (i) to reimburse Alcool for sums previously expended by
Alcool for the Project Equipment and (ii) to pay the remaining costs of the
Project Equipment. The Board will lease the Project Equipment to Alcool pursuant
to a Lease Agreement dated as of February 1, 1999 (the "Lease Agreement") and
Alcool will pay rent to the Board sufficient to pay the debt service on the
Bonds.
As security for the payment of the Bonds, Alcool and its parent
corporation, Peregrine Industries, Inc., a Florida corporation ("Peregrine" and
together with Alcool, the "Credit Obligors") will cause SouthTrust Bank,
National Association (herein, in its capacity as issuer of the initial letter of
credit referred to below, called the "Bank"), to issue an irrevocable letter of
credit in favor of the Trustee in the amount of (i) the aggregate principal
amount of the Bonds, to enable the Trustee to pay the principal amount of the
Bonds when due and to pay the principal portion of the purchase price of Bonds
tendered (or deemed tendered) for purchase, plus (ii) interest on the Bonds for
a period of 50 days at the rate of 13% per annum, to enable the Trustee to pay
interest on the Bonds when due and to pay the interest portion of the purchase
price of Bonds tendered (or deemed tendered) for purchase. The initial letter of
credit to be delivered to the Trustee and any substitute letter of credit
delivered to the Trustee pursuant to the Indenture are herein referred to as the
"Letter of Credit."
1
As security for the Credit Obligors' obligations under the Credit
Agreement with respect to the Letter of Credit, the Credit Obligors and the
Board will execute this Mortgage, Security Agreement and Assignment of Rents and
Leases dated as of February 1, 1999 (the "Mortgage") in favor of the Bank,
whereby the Bank will be granted a mortgage on and security interest in the
Project Equipment and the interest of Alcool as lessee under the Building
Sublease.
As additional security for the Credit Obligors' obligations under the
Credit Agreement with respect to the Letter of Credit, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇.
will execute an Individual Guaranty Agreement dated as of February 1, 1999 in
favor of the Bank and Peregrine Global, Inc., a United States Virgin Islands
corporation will execute a Corporate Guaranty Agreement dated as of February 1,
1999 in favor of the Bank.
References herein to the "Creditor Obligors" refers to the Credit
Obligors, jointly and severally, unless the context clearly indicates to the
contrary.
NOW, THEREFORE, in consideration of the foregoing recitals and to
induce the Bank to enter into the Credit Agreement and to cause the issuance the
Letter of Credit, and in consideration of the payment of Ten Dollars and other
good and valuable consideration by the Bank to the Board and Alcool, and to
secure the prompt payment of all amounts due under the Credit Agreement and this
Mortgage, and also to secure the full and complete performance of each and every
obligation, covenant, duty and agreement of the Board and Alcool contained in
this Mortgage and the Credit Agreement:
ARTICLE I
Definitions and Other Provisions
of General Application
Section 1.01 Definitions.
For all purposes of this Mortgage, except as otherwise expressly
provided or unless the context otherwise requires:
(1) The terms defined in this Article have the meanings assigned to
them in this Article. Singular terms shall include the plural as well as the
singular and vice versa and words connoting one gender shall refer to all
genders.
(2) All references in this instrument to designated "articles,"
"sections" and other subdivisions are to the designated articles, sections and
subdivisions of this instrument as originally executed.
(3) The terms "herein," "hereof" and "hereunder" and other words of
similar import refer to this Mortgage as a whole and not to any particular
article, section or other subdivision.
2
(4) The term "person" shall include any individual, corporation,
partnership, joint venture, association, trust, unincorporated organization and
any government or any agency or political subdivision thereof.
(5) Capitalized terms used herein without definition shall have the
respective meanings assigned thereto in the Indenture.
"Bank" shall mean SouthTrust Bank, National Association, a national
banking association, in its capacity as issuer of the Letter of Credit, its
successors and assigns.
"Board" shall mean The Industrial Development Board of the City of
▇▇▇▇▇▇▇▇▇▇, a public corporation organized under the laws of the State of
Alabama, and its successors and assigns.
"Bonds" shall mean the $2,460,000 aggregate principal amount of
Variable/Fixed Rate Industrial Development Revenue Bonds (Alcool, Inc. Project)
Series 1999, issued by the Board pursuant to the Indenture.
"Building Sublease" shall mean the Lease Agreement dated December 9,
1998 pursuant to which Industrial Partners has subleased the Project Site and
the Project Building to Alcool.
"Code" shall mean the Internal Revenue Code of 1986, and all amendments
thereto.
"Collateral" shall mean all property and rights mortgaged, assigned,
pledged or otherwise subject to the lien of this Mortgage.
"Condemnation Awards" shall have the meaning stated in the third
Granting Clause of Article II.
"Corporate Guaranty Agreement" shall mean the Corporate Guaranty
Agreement dated as of February 1, 1999 executed by Peregrine Global, Inc. in
favor of the Bank.
"Credit Agreement" shall mean that certain Credit Agreement dated as of
February 1, 1999 among Alcool, Peregrine and the Bank, including any amendments
or supplements to such instrument entered into pursuant to the applicable
provisions thereof.
"Credit Amount" shall mean the maximum amount available to be drawn
under the Letter of Credit, as reduced from time to time and reinstated from
time to time pursuant to the terms and conditions of the Letter of Credit.
"Deerfield Security Agreement" shall mean the Security Agreement dated
as of February 1, 1999 between Peregrine and the Bank relating to certain
machinery and equipment of Peregrine located in Deerfield, Florida.
3
"Event of Default" shall have the meanings stated in Article VII. An
Event of Default shall "exist" if an Event of Default shall have occurred and be
continuing.
"Financing Documents" shall mean (1) the Indenture, (2) the Lease
Agreement, (3) the Building Sublease, (4) the Credit Agreement, (5) this
Mortgage, (6) the Deerfield Security Agreement, (7) the Individual Guaranty
Agreement, and (8) the Corporate Guaranty Agreement.
"Indenture" shall mean that certain Trust Indenture dated as of
February 1, 1999 between the Board and the Trustee, including any amendments or
supplements to such instrument from time to time entered into pursuant to the
applicable provisions thereof.
"Individual Guaranty Agreement" shall mean the Individual Guaranty
Agreement dated as of February 1, 1999 executed by ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇. in
favor of the Bank.
"Lease Agreement" shall mean the Lease Agreement between the Board and
Alcool dated as of February 1, 1999, and all amendments thereto.
"Leases" shall have the meaning stated in the fifth Granting Clause of
Article II.
"Letter of Credit" shall mean the letter of credit with respect to the
Bonds to be issued by the Bank in favor of the Trustee pursuant to the Credit
Agreement.
"Mortgage" shall mean this instrument as originally executed or as it
may from time to time be supplemented, modified or amended by one or more
instruments entered into pursuant to the applicable provisions hereof.
"Obligations" shall mean:
(1) all letter of credit commissions, fees, charges and costs
becoming due and payable under the Credit Agreement in accordance with
the terms thereof;
(2) all amounts becoming due and payable under the Credit
Agreement in accordance with the terms thereof as reimbursement of sums
paid under the Letter of Credit;
(3) all interest on late payments becoming due and payable
under the Credit Agreement in accordance with the terms thereof;
(4) all amounts becoming due and payable under the Credit
Agreement in accordance with the terms thereof upon the occurrence and
continuance of an event of default, as therein defined, under the
Credit Agreement;
4
(5) all amounts payable by Alcool under the Credit Agreement
as reimbursement of increased costs to the Bank caused by changes in
laws or regulations or in the interpretation thereof;
(6) all other amounts payable by Alcool under the Credit
Agreement;
(7) all amounts payable by Alcool under the terms of this
Mortgage (including but not limited to reimbursement for advancements
made by the Bank under this Mortgage) and any other security
agreements, bank mortgage or other documents now or hereafter
evidencing or securing Alcool's performance of its obligations under
the Credit Agreement; and
(8) all renewals and extensions of any or all the obligations
of Alcool described in paragraphs (1) through (7) above (including
without limitation any renewal or extension of, and any substitute for,
the Letter of Credit), whether or not any renewal or extension
agreement is executed in connection therewith.
"Peregrine" shall mean Peregrine Industries, Inc., a Florida
corporation.
"Permitted Encumbrances" shall mean restrictions, exceptions,
reservations, conditions, limitations, interests and other matters affecting
title to the Project Equipment as approved by the Bank in writing.
"Project" shall mean the Project Site, the Project Building and the
Project Equipment, as they may at any time exist.
"Project Building" shall mean the certain building and all other
structures now located on the Project Site or hereafter acquired or constructed
on the Project Site.
"Project Equipment" shall mean the machinery, equipment, furnishings,
fixtures and other personal property described on Exhibit B and all other
machinery, equipment, furnishings, fixtures and other personal property of
Alcool or the Board now or hereafter located on the Project Site and used in the
operation of the Project.
"Project Site" shall mean the real property described in Exhibit A
hereto.
"Qualified Investments" shall have the meaning set forth therefor in
the Indenture.
"Remarketing Agreement" shall mean that certain Remarketing Agreement
dated as of February 1, 1999 among Alcool, the Board and Merchant Capital
L.L.C., as remarketing agent.
"Rents" shall have the meaning stated in the fifth Granting Clause of
Article II.
"Special Funds" shall mean all funds and accounts established pursuant
to the Indenture.
5
"Trustee" shall mean SouthTrust Bank, National Association, in its
capacity as Trustee under the Indenture, and its successors and assigns.
Section 1.02 Effect of Headings and Table of Contents.
The article and section headings herein and in the Table of Contents
are for convenience only and shall not affect the construction hereof.
Section 1.03 Date of Mortgage.
The date of this Mortgage is intended as and for a date for the
convenient identification of this Mortgage and is not intended to indicate that
this Mortgage was executed and delivered on said date.
Section 1.04 Separability Clause.
If any provision in this Mortgage shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
Section 1.05 Governing Law.
This Mortgage shall be construed in accordance with and governed by the
laws of the State of Alabama.
Section 1.06 Counterparts.
This Mortgage may be executed in any number of counterparts, each of
which so executed shall be deemed an original, but all such counterparts shall
together constitute but one and the same instrument.
ARTICLE II
Granting Clauses
The Board and Alcool have bargained and sold and hereby grant, bargain,
sell, transfer, assign, set-over and convey to the Bank, its successors and
assigns, the property and interests in property described in the following
Granting Clauses, and the Board and Alcool have granted and do hereby grant to
the Bank security title to and a continuing security interest in said property
and interests in property and all proceeds and products thereof.
6
I.
(The Project Equipment)
The Project Equipment.
II.
(The Building Sublease)
All right, title and interest of Alcool in and under the Building
Sublease.
III.
(Condemnation Awards and Insurance Proceeds)
All awards or payments, including all interest thereon, together with
the right to receive the same, that may be made to the Board or Alcool with
respect to the Collateral as a result of the exercise of the right of eminent
domain, any damage to or destruction of the Collateral or any part thereof, or
any other injury to or decrease in the value of the Collateral (herein referred
to as "Condemnation Awards"), and all right, title and interest of the Board or
Alcool in and to any policies of insurance (and the proceeds thereof) with
respect to any damage to or destruction of the Collateral.
IV.
(Special Funds)
Money and investments from time to time on deposit in, or forming a
part of, and accounts established under the Indenture (herein referred to as the
"Special Funds"), subject to the prior lien of the Indenture with respect to the
Special Funds and the provisions of the Indenture permitting the application
thereof for the purposes and on the terms and conditions set forth therein.
V.
(Leases and Rents)
(a) All written or oral leases or other agreements for the use or
occupancy of all or any portion of the Collateral with respect to which the
Board or Alcool is the lessor and any and all extensions and renewals thereof,
now or hereafter existing (collectively, the "Leases");
(b) Any and all guaranties of performance by lessees under the Leases;
7
(c) The immediate and continuing right to collect and receive all the
rents, income, receipts, revenues, issues and profits now due or that may
hereafter become due or to which the Board or Alcool may now be or may hereafter
(including during the period of redemption, if any) become entitled to demand or
claim, arising or issuing from or out of the Leases or from or out of the
Collateral, or any part thereof, including but not limited to minimum rents,
additional rents, percentage rents, common area maintenance charges, parking
charges, tax and insurance premium contributions, liquidated damages upon
default, the premium payable by any lessee upon the exercise of any cancellation
privilege provided for in any of the Leases, and all proceeds payable under any
policy of insurance covering loss of rents resulting from untenantability caused
by destruction or damage to the Collateral, together with any and all rights and
claims of any kind that Alcool may have against any such lessee under the Leases
or against any sublessees or occupants of the Collateral, all such moneys,
rights and claims described in this subparagraph (c) being hereinafter referred
to as the "Rents"; provided, however, that so long as no Event of Default has
occurred under this Mortgage, Alcool shall have the right under a license
granted hereby (but limited as provided in Section 8.07 of this Mortgage) to
collect, receive and retain the Rents (but not prior to accrual thereof); and
(d) Any award, dividend or other payment made hereafter to Alcool in
any court procedure involving any of the lessees under the Leases in any
bankruptcy, insolvency or reorganization proceeding in any state or federal
court and any and all payments made by lessees in lieu of rent, Alcool hereby
appointing the Bank as Alcool's irrevocable attorney-in-fact to appear in any
action and collect any such award, dividend or other payment.
VI.
(Lease Agreement and Rights Thereunder)
Alcool's leasehold estate and all other right, title and interest of
Alcool under and pursuant to the Lease Agreement, together with all the rights,
privileges and options set forth therein, and the rights of the Board under and
pursuant to the Lease Agreement, all lease rentals, revenues and receipts
derived by the Board from the leasing or sale of the Project Equipment,
including without limitation all rentals, revenues and receipts to be received
by the Board under and pursuant to the Lease Agreement, subject, however, to the
prior right of the Trustee to all such lease rentals, revenues and receipts so
long as there is no Event of Default existing hereunder.
8
VII.
(Other)
Any and all other real or personal property of every kind and nature
from time to time hereafter by delivery or by writing of any kind conveyed,
mortgaged, pledged, assigned or transferred to the Bank as and for additional
security hereunder by the Board or Alcool or by anyone in the behalf of, or with
the written consent of, the Board or Alcool.
All of the property described in the foregoing Granting Clauses I
through VII, both inclusive, is herein sometimes together referred to as the
"Collateral."
TO HAVE AND TO HOLD the Collateral, together with all the rights,
privileges and appurtenances thereunto belonging, unto the Bank, as its
successors and assigns, forever.
9
ARTICLE III
Representations and Warranties
Section 3.01 Board Representations and Warranties.
To induce the Bank to enter into the Credit Agreement and to cause the
issuance of the Letter of Credit, the Board represents and warrants that:
(1) Valid Title and Related Warranties. Alcool is lawfully
seized of a leasehold interest in and to the Project Equipment pursuant
to the Lease Agreement. The Board is lawfully seized of an indefeasible
estate in and to, and good title to, the Project Equipment; the Board
has a good right to sell and mortgage the Collateral; the Collateral is
subject to no liens, encumbrances or security interests other than
Permitted Encumbrances; and the Board will forever warrant and defend
the title to the Collateral unto the Bank against the claims of all
persons whomsoever, except those claiming under Permitted Encumbrances.
It is expressly understood and agreed that, with respect to the Special
Funds, the lien created by this Mortgage is junior and subordinate to
the lien created by the Indenture.
(2) Maintenance of Lien Priority. The Board shall take all
steps necessary to preserve and protect the validity and priority of
the liens on and security interests in the Collateral created hereby.
The Board shall execute, acknowledge and deliver such additional
instruments as the Bank may deem necessary in order to preserve,
protect, continue, extend or maintain the lien and security interest
created hereby as a lien on and security interest in the Collateral
subject only to Permitted Encumbrances, except as otherwise permitted
under the terms of this Mortgage. All costs and expenses incurred in
connection with the protection, preservation, continuation, extension
or maintaining of the liens and security interests hereby created shall
be paid by Alcool.
Section 3.02 Alcool Representations and Warranties.
To induce the Bank to enter into the Credit Agreement and to
cause the issuance of the Letter of Credit, Alcool represents and warrants that:
(1) Valid Title and Related Warranties. Alcool is lawfully
seized of a leasehold interest in and to the Project Equipment pursuant
to the Lease Agreement. Alcool has a good right to sell and mortgage
its rights in the Collateral; the Collateral is subject to no liens,
encumbrances or security interests other than Permitted Encumbrances;
and Alcool will forever warrant and defend the title to the Collateral
unto the Bank against the claims of all persons whomsoever, except
those claiming under Permitted Encumbrances. It is expressly understood
and agreed that, with respect to the Special Funds, the lien created by
this Mortgage is junior and subordinate to the lien created by the
Indenture.
10
(2) Maintenance of Lien Priority. Alcool shall take all steps
necessary to preserve and protect the validity and priority of the
liens on and security interests in the Collateral created hereby.
Alcool shall execute, acknowledge and deliver such additional
instruments as the Bank may deem necessary in order to preserve,
protect, continue, extend or maintain the lien and security interest
created hereby as a lien on and security interest in the Collateral
subject only to Permitted Encumbrances, except as otherwise permitted
under the terms of this Mortgage. All costs and expenses incurred in
connection with the protection, preservation, continuation, extension
or maintaining of the liens and security interests hereby created shall
be paid by Alcool.
(3) Toxic or Hazardous Substances. To the best of Alcool's
knowledge no toxic or hazardous substances (including without
limitation asbestos) have been located, stored or dumped on the Project
Site, or used in connection with, or in the construction or operation
of the Project, or any part thereof.
ARTICLE IV
Covenants of Alcool
Section 4.01 Payment of Taxes and Other Assessments
Alcool will pay or cause to be paid all taxes, assessments and other
governmental, municipal or other public dues, charges, fines or impositions
imposed or levied upon the Collateral, or on the interests created by this
Mortgage or with respect to the filing of this Mortgage, and any tax or excise
on rents or other tax, however described, assessed or levied by any state,
federal or local taxing authority as a substitute, in whole or in part, for
taxes assessed or imposed on the Collateral or on the lien and other interests
created by this Mortgage, and at least 10 days before said taxes, assessments
and other governmental charges are due, Alcool will deliver receipts therefor to
the Bank or, in the case of mortgage filing privilege taxes, pay to the Bank an
amount equal to the taxes. Alcool may, at its own expense, in good faith contest
any such taxes, assessments and other governmental charges and, in the event of
any such contest, may permit the taxes, assessments or other governmental
charges so contested to remain unpaid during the period of such contest and any
appeal therefrom, provided that during such period enforcement of such contested
items shall be effectively stayed. Any tax or assessment levied, assessed or
imposed by any governmental authority on the Bank as a legal holder of any of
the Obligations or any interest in this Mortgage (other than federal and state
income taxes), shall be paid by Alcool promptly after they become due and
payable but in any event before they become delinquent unless such payment by
Alcool is unlawful.
Section 4.02 Insurance
(a) Alcool shall keep or cause to be kept the Collateral insured
against loss or damage by fire, windstorm, extended coverage perils, vandalism,
malicious mischief and such other hazards, casualties or other contingencies as
from time to time may be required by the Bank (including but not limited to
builder's risk during the period of construction or repair of the Project), in
such
11
amounts, in such manner and in such companies as the Bank may reasonably
approve, including but not limited to all insurance required to be maintained
under the terms of the Credit Agreement.
(b) If the Project Equipment or any part thereof is damaged or
destroyed by fire or other casualty, Alcool shall comply with the provisions of
Section 4.14 of the Credit Agreement.
Section 4.03 Condemnation Awards
The entire proceeds of any Condemnation Award shall be applied as
provided in Section 4.15 of the Credit Agreement.
Section 4.04 Waste, Demolition, Alteration or Replacement
Alcool will cause the Collateral and every part thereof to be
maintained, preserved and kept in safe and good repair, working order and
condition, will not commit or permit waste thereon, will not remove, demolish or
materially alter the design or structural character of its Project Equipment
without the express prior written consent of the Bank, will comply with all laws
and regulations of any governmental authority with reference to the Collateral
and the manner and use of the same, and will from time to time make all
necessary and proper repairs, renewals, additions and restorations thereto so
that the value and efficient use thereof shall be preserved and maintained.
Alcool agrees not to remove any of the fixtures or personal property included in
the Collateral except as may be permitted by the Credit Agreement.
Section 4.05 Compliance by Alcool with Terms of Other Financing
Documents
Alcool shall comply, fully and faithfully, with all of its obligations
under the other Financing Documents. If Alcool fails or refuses to do so, the
Bank may, but shall not be required to, perform any and all of such obligations
of Alcool under the other Financing Documents, including but not limited to the
payment of any or all sums due from Alcool thereunder. Any sums so paid by the
Bank shall constitute part of the Obligations and shall be secured hereby.
Section 4.06 Environmental Compliance
(a) Alcool shall (1) not, and shall not permit any other person to,
bring any Hazardous Substances onto the Project Site except any such Hazardous
Substances that are used in the ordinary course of the contemplated businesses
as to be conducted on the Project Site and that are handled, stored, used and
disposed of in accordance with applicable Environmental Laws; (2) if any other
Hazardous Substances are brought on the Project Site, immediately remove and
properly dispose of the same in accordance with applicable Environmental Laws;
(3) cause the operations conducted on the Project Site (including all operations
conducted thereon by other persons) to comply with all Environmental Laws; (4)
permit the Bank from time to time to inspect the Project Site and observe the
operations thereon; (5) undertake any and all preventive, investigatory and
remedial action (including emergency response, removal, clean up, containment
and other remedial action) that is caused by Alcool and (A) required by any
applicable Environmental Law or (B) necessary to prevent
12
or minimize any property damage (including damage to any of the Project Site),
personal injury, or harm to the environment, or the threat of any such damage or
injury, by releases of or exposure to Hazardous Substances in connection with
the operations on the Project Site; (6) promptly give notice to the Bank in
writing if Alcool should become aware of (A) any spill, release or disposal of
any Hazardous Substances, or imminent threat thereof, at the Project Site, in
connection with the operations on the Project Site, or at any adjacent property
that could migrate to, through or under the Project Site, (B) any violation of
Environmental Laws regarding the Project Site or operations on the Project Site,
and (C) any investigation, claim or threatened claim under any Environmental
Law, or any notice of violation under any Environmental Law, involving Alcool or
the Project Site; and (7) deliver to the Bank, at the Bank's request, copies of
any and all documents in Alcool's possession or to which Alcool has access
relating to Hazardous Substances or Environmental Laws and the Project Site, and
the operations on the Project Site, including laboratory analyses, site
assessments or studies, environmental audit reports and other environmental
studies and reports.
(b) If the Bank at any time reasonably believes that Alcool is not
complying with all applicable Environmental Laws or the requirements hereof
regarding the same, or that a material spill, release or disposal of Hazardous
Substances has occurred on or under the Project Site, the Bank may require
Alcool to furnish to the Bank an environmental audit or site assessment
reasonably satisfactory to the Bank with respect to the matters of concern to
the Bank. Such audit or assessment shall be performed at Alcool's expense by a
qualified consultant approved by the Bank.
(c) Alcool hereby warrants that, to the best of the information,
knowledge and belief thereof (1) there are no civil, criminal or administrative
environmental proceedings involving the Project Site that are pending or to
Alcool's knowledge threatened; (2) Alcool knows of no facts or circumstances
that might give rise to such a proceeding in the future; (3) the Project Site is
in compliance with all applicable federal, state and local statutory and
regulatory environmental requirements; and (4) the Project Site is free from any
and all Hazardous Substances.
(d) Alcool shall defend, indemnify and save harmless the Bank and the
Board from and against any and all claims, causes of action, judgments, damages,
fines, penalties, and other losses, costs and expense, including reasonable
attorneys' fees and costs of investigation and litigation, asserted against or
suffered by the Bank that are related to or arise out of or result from the
presence of Hazardous Substances which result from Alcool's use and occupancy of
the Project Site and any clean up or removal of, or other remedial action with
respect to, any Hazardous Substances which result from Alcool's use and
occupancy of the Project Site, or any part thereof, that may be required by any
Environmental Law or Governmental Authority. The provisions of this Section 4.06
shall survive the payment of the Bonds in full and the termination,
satisfaction, release (in whole or in part) and the foreclosure of this Mortgage
with respect to claims and losses asserted against or suffered by the Bank.
13
For purposes of this Section 4.06 the following terms shall have the
following meanings:
"Environmental Law" shall mean and include all laws, rules,
regulations, ordinances, judgments, decrees, codes, orders, injunctions, notices
and demand letters of any Governmental Authority applicable to Alcool or the
Project Site (including the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended, 42 U.S.C. Sections 9601, et seq.)
relating to pollution or protection of human health or the environment,
including any relating to Hazardous Substances.
"Governmental Authority" shall mean any federal, state, county,
municipal, or other government, domestic or foreign, and any agency, authority,
department, commission, bureau, board, court or other instrumentality thereof.
"Hazardous Substances" shall mean and include all pollutants,
contaminants, toxic or hazardous wastes and other substances (including
asbestos, urea formaldehyde, foam insulation and materials containing either
petroleum or any of the substances referenced in Section 101(14) of CERCLA), the
removal of which is required or the manufacture, use, maintenance and handling
of which is regulated, restricted, prohibited or penalized by an Environmental
Law, or, even though not so regulated, restricted, prohibited or penalized,
might pose a hazard to the health and safety of the public or the occupants of
the property on which it is located or the occupants of the property adjacent
thereto.
ARTICLE V
Transfer of, or Liens on, Collateral
Section 5.01 Limitation on Conveyance and Encumbrance
Alcool covenants and agrees that it will not, without the express prior
written consent of the Bank, sell, transfer, convey or otherwise dispose of, or
create, or permit or suffer to exist, any lien, security interest or other
encumbrance (other than Permitted Encumbrances) on, all or any part of the
Collateral (including but not limited to any Leases and Rents) or any interests
therein, it being expressly understood and agreed that a violation of the
provisions of this Article V shall constitute an Event of Default under this
Mortgage. Any sale, transfer, conveyance, other disposition or act of creating,
permitting or suffering to exist any lien, security interest or other
encumbrance in violation of this Article V shall be null, void and of no effect.
14
ARTICLE VI
Defeasance
Section 6.01 Satisfaction of Mortgage
If (i) Alcool shall pay in full and discharge all the Obligations; and
(ii) the Letter of Credit shall then be terminated; then this Mortgage and the
grants and conveyances contained herein shall become null and void, and the
Collateral shall revert to the Board and Alcool, and the entire estate, right,
title and interest of the Bank shall thereupon cease; and the Bank shall, upon
the request of Alcool and at Alcool's cost and expense, deliver to the Board and
Alcool proper instruments acknowledging satisfaction of this instrument and
terminating all financing statements filed in connection herewith; otherwise,
this Mortgage shall remain in full force and effect. Notwithstanding anything to
the contrary contained in this Article VI or elsewhere in this Mortgage, it is
expressly understood and agreed that, although there may be from time to time
occasions when no Obligations shall be outstanding, this Mortgage and the lien
hereof and security interests created hereby shall nevertheless remain in full
force and effect, and none of the estate, right, title and interest of the Bank
passing by this Mortgage shall divest nor shall the Collateral revert to the
Board and Alcool, so long as any one or more or all of the following
circumstances exist:
(1) the Letter of Credit has been issued and is outstanding;
or
(2) any Obligations are outstanding.
ARTICLE VII
Events of Default
Section 7.01 Defaults
Any one or more of the following shall constitute an event of default
(an "Event of Default") under this Mortgage (whatever the reason for such event
and whether it shall be voluntary or involuntary or be effected by operation of
law or pursuant to any judgment, decree or order of any court or any order, rule
or regulation of any administrative or governmental body):
(1) default in the performance, or breach, of any covenant,
condition or agreement on the part of Alcool contained in Sections 4.01
and 4.02 or Article V hereof; or
(2) default in the performance, or breach, of any covenant or
warranty of Alcool in this Mortgage (other than a covenant or warranty,
a default in the performance or breach of which is elsewhere in this
Section specifically described), and the continuance of such default or
breach for a period of 30 days after there has been given, by
registered or certified mail, to Alcool by the Bank a written notice
specifying such default or breach and requiring it to be remedied and
stating that such notice is a "notice of default" hereunder; or
(3) any representation or warranty made by Alcool herein or in
any document, instrument or certificate furnished to the Bank in
connection with the issuance of the Letter of Credit or the
consummation of the transactions contemplated by the Financing
Documents shall at any time prove to have been false or incorrect in
any material respect as of the time made; or
15
(4) the occurrence of an event of default, as therein defined,
under the Credit Agreement or any other Financing Document and the
expiration of the applicable grace period, if any, specified therein;
or
(5) the interest of the Bank in the Collateral shall become
endangered by reason of the enforcement of any prior lien or
encumbrance thereon (other than Permitted Encumbrances or the lien of
the Indenture with respect to the Special Funds); or
(6) the lien or security interest created by this Mortgage is
invalid or unenforceable as to any part of the Obligations or is
invalid or unenforceable as to any part of the Collateral.
ARTICLE VIII
Rights of Bank Upon Default
Section 8.01 Acceleration of Indebtedness
If an Event of Default exists, the Bank may notify the Trustee that an
event of default, as therein defined, under the Credit Agreement has occurred
and is continuing (it being agreed that the occurrence of an Event of Default
hereunder shall constitute an event of default under the Credit Agreement) and
may, by notice to Alcool, effective upon dispatch, declare all of the
Obligations, including but not limited to the obligation of Alcool to reimburse
the Bank under the Credit Agreement, to be forthwith due and payable, whereupon
all the Obligations shall become and be forthwith due and payable, without
presentment, demand, protest or further notice of any kind, all of which are
hereby expressly waived by Alcool, and the Bank may immediately enforce payment
of all such amounts and exercise any or all of its rights and remedies under
this Mortgage and the Credit Agreement and available at law or equity.
Section 8.02 Operation of Collateral by Bank
In addition to all other rights herein and in the Credit Agreement
conferred on the Bank, if an Event of Default exists, the Bank (or any person,
firm or corporation designated by the Bank) may, but shall not be obligated to,
enter upon and take possession of any or all of the Collateral, exclude Alcool
therefrom, and hold, use, administer, manage and operate the same to the extent
that Alcool could do so, without any liability to Alcool resulting therefrom;
and the Bank may collect, receive and receipt for all proceeds accruing from
such operation and management, make repairs and purchase needed additional
property, and exercise every power, right and privilege of Alcool with respect
to the Collateral.
16
Section 8.03 Judicial Proceedings; Right to Receiver
If an Event of Default exists, the Bank, in lieu of or in addition to
exercising the power of sale hereinafter given, may proceed by suit for a
foreclosure of its lien on and security interest in the Collateral, to ▇▇▇
Alcool for damages on account of or arising out of said default or breach, or to
▇▇▇ Alcool for specific performance of any provision contained herein, or to
enforce any other appropriate legal or equitable right or remedy, whether under
this Mortgage, the Credit Agreement or otherwise. The Bank shall be entitled, as
a matter or right, upon ▇▇▇▇ filed or other proper legal proceedings being
commenced for the foreclosure of this Mortgage, to the appointment by any
competent court or tribunal, without notice to Alcool or any other party, of a
receiver of the rents, issues and profits of the Collateral, with power to lease
and control the Collateral and with such other powers as may be deemed
necessary, subject to the rights of the Trustee under the Indenture.
Section 8.04 Foreclosure Sale
This Mortgage shall be subject to foreclosure and may be foreclosed as
now provided by law in case of past due mortgages, and the Bank shall be
authorized, at its option, whether or not possession of the Collateral is taken,
after giving 21 days' notice by publication once a week for three consecutive
weeks of the time, place and terms of each such sale together with a description
of the property to be sold by publication in some newspaper published in
▇▇▇▇▇▇▇▇▇▇ County, Alabama, to sell, or cause to be sold, all and singular the
Collateral, and all the estate, right, title and interest therein, in front of
the courthouse door of the ▇▇▇▇▇▇▇▇▇▇ County Courthouse, at public outcry,
between the hours of 11:00 A.M. and 4:00 P.M., local time, to the highest bidder
for cash, or otherwise foreclose this mortgage as provided by applicable law.
The Bank, its successors and assigns, may bid at any sale or sales had under the
terms of the Mortgage and may purchase the Collateral, or any part thereof, if
the highest bidder therefor. The purchaser at any such sale or sales shall be
under no obligation to see to the proper application of the purchase money. At
any foreclosure sale any part or all of the Collateral, real, personal or mixed,
may be offered for sale in parcels or en mass for one total price, the proceeds
of any such sale en masse to be accounted for in one account without distinction
between the items included therein or without assigning to them any proportion
of such proceeds, Alcool hereby waiving the application of any doctrine of
marshalling or like proceeding. If the Bank, in the exercise of the power of
sale herein given, elects to sell the Collateral in parts or parcels, sales
thereof may be held from time to time, and the power of sale granted herein
shall not be fully exercised until all of the Collateral not previously sold
shall have been sold or all the Obligations shall have been paid in full. The
Board and Alcool hereby waive any equitable rights otherwise available to either
of them with respect to marshalling of assets hereunder, so as to require
separate sales of the fee estate and the leasehold estate encumbered hereby or
to require the Bank to exhaust its remedies against either one or the other; and
the Board and Alcool hereby express consent to and authorize, at the option of
the Bank, the sale, either separately or together, of the fee estate and
leasehold estate, or otherwise the merger, prior to sale, of the leasehold
estate into the fee estate in order that the fee estate may be sold free and
clear of the leasehold estate.
17
Section 8.05 Project Equipment
(a) The Bank shall have and may exercise with respect to any or all of
the Project Equipment all rights, remedies and powers of a mortgagee under
Alabama law or a secured party under the Alabama Uniform Commercial Code with
reference to the Project Equipment or any other items in which a security
interest has been granted herein, including without limitation the right and
power to sell at public or private sale or sales or otherwise dispose of, lease
or utilize the Project Equipment and any part or parts thereof in any manner, to
the fullest extent authorized or permitted under the Alabama Uniform Commercial
Code after default hereunder, without regard to preservation of the Project
Equipment or their value and without the necessity of a court order. The Bank
shall have, among other rights, the right to take possession of the Project
Equipment and to enter upon any premises where the same may be situated for the
purpose of repossessing the same without being guilty of trespass and without
liability for damages occasioned thereby and to take any action deemed
appropriate or desirable by the Bank, at its option and in its sole discretion,
to repair, restore or otherwise prepare the Project Equipment for sale or lease
or other use or disposition. To the extent permitted by law, Alcool expressly
waives any notice of sale or any other disposition of the Project Equipment and
any rights or remedies of the Bank with respect to, and the formalities
prescribed by law relative to, the sale or disposition of the Project Equipment
or to the exercise of any other right or remedy of the Bank existing after
default. To the extent that such notice is required and cannot be waived, Alcool
agrees that if such notice is given to Alcool in accordance with the provisions
of Section 9.08 below, at least 10 days before the time of the sale or other
disposition, such notice shall be deemed reasonable and shall fully satisfy any
requirement for giving said notice.
(b) The Board and Alcool agree that the Bank may sell or dispose of the
Project Equipment in accordance with the rights and remedies granted under this
Mortgage with respect to the real property covered hereby. Alcool hereby grants
to the Bank the right, at its option after default by Alcool, to transfer at any
time to itself or its nominee the Project Equipment or any part thereof and to
receive the monies, income, proceeds and benefits attributable to the same and
to hold the same as additional Collateral or to apply it on the Obligations in
such order and manner as the Bank may elect. Alcool covenants and agrees that
all recitals in any instrument transferring, assigning, leasing or making other
disposition of the Project Equipment or any part thereof shall be full proof of
the matters stated therein, and no other proof shall be required to establish
the legal propriety of the sale or other action taken by the Bank and that all
prerequisites of sale shall be presumed conclusively to have been performed or
to have occurred.
Section 8.06 Conveyance After Sale
The Board and Alcool hereby authorize and empower the Bank or the
auctioneer at any foreclosure sale had hereunder, for and in the name of the
Board and Alcool, to execute and deliver to the purchaser or purchasers of any
of the Collateral sold at foreclosure good and sufficient deeds of conveyance or
bills of sale thereto.
18
Section 8.07 Rents and Leases
(a) If an Event of Default exists, the Bank, at its option, shall have
the right, power and authority to exercise and enforce any or all of the
following rights and remedies with respect to Rents and Leases:
(1) to terminate the license granted to Alcool in Article II
hereof to collect the Rents, and, without taking possession, in the
Bank's own name to demand, collect, receive, ▇▇▇ for, attach and levy
the Rents, to give proper receipts, releases and acquittances therefor,
and after deducting all necessary and reasonable costs and expenses of
collection, including reasonable attorney's fees, to apply the net
proceeds thereof to the Obligations in such order and amounts as the
Bank may choose (or hold the same in a reserve as security for the
Obligations);
(2) without regard to the adequacy of the security, with or
without any action or proceeding, through any person or by agent, or by
a receiver to be appointed by court, to enter upon, take possession of,
manage and operate the Collateral or any part thereof for the account
of Alcool, make, modify, enforce, cancel or accept surrender of any
Sublease, remove and evict any sublessee, increase or reduce rents,
decorate, clean and make repairs, and otherwise do any act or incur any
cost or expenses the Bank shall deem proper to protect the security
hereof, as fully and to the same extent as Alcool could do if in
possession, and in such event to apply any funds so collected to the
operation and management of the Collateral (including payment of
reasonable management, brokerage and attorney's fees) and payment of
the Obligations in such order and amounts as the Bank may choose (or
hold the same in reserve as security for the Obligations);
(3) to take whatever legal proceedings may appear necessary or
desirable to enforce any obligation or covenant or agreement of Alcool
under this Mortgage.
(b) The collection of the Rents and application thereof (or holding
thereof in reserve) as aforesaid or the entry upon and taking possession of the
Collateral or both shall not cure or waive any default or waive, modify or
affect any notice of default under this Mortgage, or invalidate any act done
pursuant to such notice, and the enforcement of such right or remedy by the
Bank, once exercised, shall continue for so long as the Bank shall elect,
notwithstanding that the collection and application aforesaid of the Rents may
have cured the original default. If the Bank shall thereafter elect to
discontinue the exercise of any such right or remedy, the same or any other
right or remedy hereunder may be reasserted at any time and from time to time
following any subsequent default.
Section 8.08 Application of Proceeds
All payments then held or thereafter received by the Bank as proceeds
of the Collateral, as well as any and all amounts realized by the Bank in
connection with the enforcement of any right or remedy under or with respect to
this Mortgage, shall be applied by the Bank as follows:
19
(1) to reimburse the Bank for any payments made under the
Letter of Credit, to accrued but unpaid commissions, fees, costs and
charges under the Credit Agreement, and to the payment of all costs and
expenses of any kind then or thereafter at any time reasonably incurred
by the Bank in exercising its rights under this Mortgage and under the
Credit Agreement or otherwise reasonably incurred by the Bank in
collecting or enforcing payment of the Obligations, as well as to the
payment of any other amount then or thereafter at any time owing by
Alcool to the Bank under the Credit Agreement or under this Mortgage,
all in such priority as among such principal, interest, costs, fees,
expenses and other amounts as the Bank shall elect;
(2) any balance remaining after payment in full of all amounts
referred to in paragraph (1) above shall be applied by the Bank to any
other Obligations then owing by Alcool to the Bank;
(3) any balance remaining after payment in full of all amounts
referred to in paragraphs (1) and (2) above shall be held by the Bank
as a cash collateral reserve against the making of any payment under
the Letter of Credit (if then outstanding); and
(4) any balance remaining after payment in full of all amounts
referred to in paragraphs (1), (2) and (3) above shall be paid by the
Bank to Alcool or to whomever else may then be legally entitled
thereto.
Section 8.09 Multiple Sales
The Bank shall have the option to proceed with foreclosure, either
through the courts or by proceeding with foreclosure as provided for in this
Mortgage, but without declaring all of the Obligations due. Any such sale may be
made subject to the unmatured part of the Obligations, and such sale, if so
made, shall not in any manner affect the unmatured part of the Obligations, but
as to such unmatured part of the Obligations this Mortgage shall remain in full
force and effect as though no sale had been made under the provisions of this
Section. Several sales may be made under the provisions of this Section without
exhausting the right of sale for any remaining part of the Obligations whether
then matured or unmatured, the purpose hereof being to provide for a foreclosure
and sale of the Collateral for any matured part of the Obligations without
exhausting any power of foreclosure and the power to sell the Collateral for any
other part of the Obligations, whether matured at the time or subsequently
maturing.
Section 8.10 Waiver of Appraisement Laws
The Board and Alcool waive, to the fullest extent permitted by law, the
benefit of all laws now existing or hereafter enacted providing for (i) any
appraisement before sale of any portion of the Collateral (commonly known as
appraisement laws) or (ii) any extension of time for the enforcement of the
collection of the Obligations or any creation or extension of a period of
redemption from any sale made in collecting the Obligations (commonly known as
stay laws and redemption laws).
20
ARTICLE IX
Miscellaneous Provisions
Section 9.01 General Provisions Regarding Remedies
The exercise by the Bank of any option given under the terms of this
Mortgage shall not be considered as a waiver of the right to exercise any other
option given herein, and the filing of a suit to foreclose the lien and security
interest granted by this Mortgage, either on any matured portion of the
Obligations or for the whole of the Obligations, shall not be considered an
election so as to preclude foreclosure under power of sale after a dismissal of
the suit; nor shall the publication of notices for foreclosure preclude the
prosecution of a later suit thereon. No failure or delay on the part of the Bank
in exercising any right, power or remedy under this Mortgage shall operate as a
waiver thereof, nor shall any single or partial exercise of any such right,
power or remedy preclude any other or further exercise thereof or the exercise
of any other right, power or remedy hereunder or thereunder. The remedies
provided in this Mortgage and in the Credit Agreement are cumulative and not
exclusive of any remedies provided by law. No amendment, or modification shall
be effective unless signed in writing by the parties hereto and no termination
or waiver of any provisions of this Mortgage or the Credit Agreement, nor
consent to any departure by Alcool therefrom, shall be effective unless the same
shall be in writing and signed by an executive officer of the Bank, and then
such waiver of consent, shall be effective only in the specific instance and for
the specific purpose for which given. No notice to or demand on Alcool in any
case shall entitle Alcool to any other or further notice or demand in similar or
other circumstances.
Section 9.02 Landlord-Tenant Relationship
Any sale of the Collateral under this Mortgage shall, without further
notice, create the relationship of landlord and tenant at sufferance between the
purchaser and Alcool.
Section 9.03 Enforceability
If any provision of this Mortgage is now or at any time hereafter
becomes invalid or unenforceable, the other provisions hereof shall remain in
full force and effect, and the remaining provisions hereof shall be construed in
favor of the Bank to effectuate the provisions hereof.
Section 9.04 Application of Payments
If the lien or the security interest created by this Mortgage is
invalid or unenforceable as to any part of the Obligations or is invalid or
unenforceable as to any part of the Collateral, the unsecured or partially
secured portion of the Obligations shall be completely paid prior to the payment
of the remaining and secured or partially secured portion of the Obligations,
and all payments made on the Obligations, whether voluntary or under foreclosure
or other enforcement action or procedures, shall be considered to have been
first paid on and applied to the full payment
21
of that portion of the Obligations that is not secured or not fully secured by
the lien or security interest created hereby.
Section 9.05 Advances by Bank
If Alcool shall fail to comply with the provisions hereof with respect
to the securing of insurance, the payment of taxes, assessments and other
charges, the keeping of the Collateral in repair, or any other term or covenant
herein contained, the Bank may (but shall not be required to) make advances to
perform the same, and where necessary enter or take possession of the Collateral
for the purpose of performing any such term or covenant. Alcool agrees to repay
all sums advanced upon demand, with interest from the date such advances are
made, at the Post Default Rate (to the fullest extent permitted by applicable
law), and all sums so advanced, with interest, shall be secured hereby.
Section 9.06 Release or Extension by Bank
The Bank, without notice, may release any part of the Collateral or any
person liable for the Obligations without in any way affecting the rights of the
Bank hereunder as to any part of the Collateral not expressly released and may
agree with any party with an interest in the Collateral to extend the time for
payment of all or any part of the Obligations or to waive the prompt and full
performance of any term, condition or covenant of this Mortgage or the Credit
Agreement.
Section 9.07 Partial Payments
Acceptance by the Bank of any payment of less than the amount due on
the Obligations shall be deemed acceptance on account only, and the failure of
Alcool to pay the entire amount then due shall be and continue to constitute an
Event of Default, and at any time thereafter and until the entire amount due on
the Obligations has been paid, the Bank shall be entitled to exercise all rights
conferred on it by the terms of this Mortgage in case of the existence of an
Event of Default.
Section 9.08 Addresses for Notices
(a) Any request, demand, authorization, direction, notice, consent, or
other document provided or permitted by this Mortgage to be made upon, given or
furnished to, or filed with, Alcool, the Board or the Bank shall be sufficient
for every purpose hereunder if in writing and (except as otherwise provided in
this Mortgage) either (i) delivered personally to the party or, if such party is
not an individual, to an officer, or other legal representative of the party to
whom the same is directed, or (ii) mailed by certified mail, postage prepaid and
addressed as follows:
22
(1) if to Alcool:
Alcool, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇, President
(2) if to the Board:
The Industrial Development Board
of the City of ▇▇▇▇▇▇▇▇▇▇
c/o ▇▇. ▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, ▇▇.
Suite ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chairman
(3) if to the Bank:
SouthTrust Bank,
National Association
Post Office Box 230517 [36123-0517]
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Alcool, the Board and the Bank may specify a different address for the receipt
of such documents by mail by giving notice of the change in address to the other
parties identified in this subsection.
(b) Any such notice or other document shall be deemed to be received
(i) as of the date delivered, if delivered personally in accordance with
subsection (a)(i) of this Section, or (ii) as of 3 days after the date deposited
in the mail, if mailed in accordance with subsection (a)(ii) of this Section.
Section 9.09 Construction of Mortgage
This Mortgage may be construed as a mortgage, chattel mortgage,
conveyance, assignment, security agreement, pledge, financing statement,
hypothecation or contract, or any one or more of them, in order fully to
effectuate the lien hereof and security interest created hereby and the purposes
and agreements herein set forth.
23
Section 9.10 Limitation of Liability
Anything contained herein to the contrary notwithstanding, the
obligations of the Board hereunder shall be limited obligations of the Board
payable solely from the payments by Alcool under the Lease Agreement and any
other revenues received by the Board from the lease or sale of the Project
Equipment.
No recourse shall be had for the payment of the principal of, premium
(if any), or interest on the Bonds or for any claims based thereon or upon any
obligation, covenant or agreement herein contained, against any incorporator of
the Board, or against any past, present or future officer, employee or member of
the board of directors of the Board or any successor corporation, as such,
either directly or through the Board or any successor corporation, under any
rule of law or equity, statute or constitution or by the enforcement of any
assessment or penalty or otherwise, and all such liability of any such
incorporators, officers, employees or directors of the Board as such is hereby
expressly waived and released as a condition of and in consideration for the
execution of this instrument and the issuance of the Bonds.
Section 9.11 Cooperation with Alcool
The Board will cooperate with Alcool to the end that the Project
Equipment may be leased by Alcool in the most successful and productive manner
possible.
Section 9.12 Collection and Disposition of Revenues and Receipts
The Board will promptly collect or cause to be collected all revenues
and receipts derived from the leasing or sale of the Project Equipment by the
Board as the same become due and will cause all such revenues and receipts as
collected to be paid over to and deposited with the Trustee for disposition in
accordance with and as provided in the Indenture and this Mortgage.
Section 9.13 Board to Keep Project Equipment Leased
The Board will cooperate with the Bank and Alcool to keep the Project
Equipment leased to lessees qualified under the Enabling Law at all times for a
rent sufficient to pay the installments of principal and interest on the Bonds
as the same mature and come due, and also, unless leased under an agreement
requiring the lessee to take out, maintain and pay for adequate and proper
insurance of the Project Equipment and requiring the lessee to keep and maintain
the Project Equipment in good repair and operating condition, sufficient also to
pay the cost of such insurance and such maintenance and repair. Should there be
a default under the Lease Agreement with the result that the right of possession
of the Project Equipment under the Lease Agreement is returned to the Board, the
Board shall fully cooperate with the Bank and shall diligently proceed in good
faith and use its best efforts to secure another qualified lessee or lessees for
the Project Equipment to the end that at all times sufficient revenues and
receipts will be derived from the Project Equipment promptly to meet and pay the
installments of principal and interest on the Bonds as the same become due and
payable, as well as covering the cost of maintaining and insuring the Project
Equipment. Nothing herein, however, shall be construed as requiring the Board to
operate the Project Equipment.
24
IN WITNESS WHEREOF, the Board and Alcool have each caused this
instrument to be executed in its name under seal and attested, respectively, all
by its duly authorized officers, and the parties have caused this instrument to
be dated as of February 1, 1999.
THE INDUSTRIAL DEVELOPMENT BOARD
OF THE CITY OF ▇▇▇▇▇▇▇▇▇▇
By:___/s/_______________________________
__________________________________
Its Chairman
ATTEST:
__________________________________
Its Secretary
STATE OF ALABAMA
COUNTY OF MONTGOMERY
I, the undersigned, a Notary Public in and for said County in said
State, hereby certify that R. E. ▇▇▇▇▇▇▇▇, Jr., whose name as Chairman of The
Industrial Development Board of the City of ▇▇▇▇▇▇▇▇▇▇, a public corporation, is
signed to the foregoing instrument, and who is known to me, acknowledged before
me on this day that, being informed of the contents of the said instrument, he,
in his capacity as such officer, and with full authority, executed the same
voluntarily for and as the act of said corporation.
GIVEN under my hand this the 8th day of March, 1999.
________________________________________
Notary Public
(SEAL)
My commission expires:__________________
25
ALCOOL, INC.
By:___/s/_______________________________
__________________________________
Its President
ATTEST:
__________________________________
Its Secretary
STATE OF ALABAMA
COUNTY OF MONTGOMERY
I, the undersigned, a Notary Public in and for said County in said
State, hereby certify that ▇▇▇▇▇ ▇. ▇▇▇▇▇, whose name as President of Alcool,
Inc., a corporation, is signed to the foregoing instrument, and who is known to
me, acknowledged before me on this day that, being informed of the contents of
the said instrument, he, in his capacity as such officer, and with full
authority, executed the same voluntarily for and as the act of said corporation.
GIVEN under my hand this the 8th day of March, 1999.
________________________________________
Notary Public
(SEAL)
My commission expires:__________________
26
SOUTHTRUST BANK,
NATIONAL ASSOCIATION
By:___/s/_______________________________
__________________________________
Its__________________________________
__________________________________
STATE OF ALABAMA
COUNTY OF MONTGOMERY
I, the undersigned, a Notary Public in and for said County in said
State, hereby certify that ____________________________________, whose name as
_______________________ of SouthTrust Bank, National Association, a national
banking association, is signed to the foregoing instrument, and who is known to
me, acknowledged before me on this day that, being informed of the contents of
the said instrument, he, in his capacity as such officer, and with full
authority, executed the same voluntarily for and as the act of said association.
GIVEN under my hand this the 8th day of March, 1999.
________________________________________
Notary Public
(SEAL)
My commission expires:__________________
27
EXHIBIT A
Real Property
Lot 2-9B according to the Map of Part of Parcel ▇-▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ 1 and Parcel ▇-▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇ 2, being in the
west 1/2 of Section 35, T17N, R18E and ▇▇▇▇▇▇▇ ▇, ▇▇▇▇, ▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, as said map appears of record in the office
of the Judge of Probate of Montgomery County, Alabama, in Plat Book 27,
Page 80, containing 6.26 acres, more or less.
EXHIBIT B
Project Equipment
Item Description
---- -----------
1 (2) Indexing C.A.B Furnaces and Fluxer
2 (2) Manual Core Assembly Machines
3 FIN Machine #1
4 Continuous Core Builder #1
5 FIN Machine #2
6 Paint Line
7 Hydrophilic Coating Line
8 Jigs and Fixtures
9 (2) Test Tanks
10 Multi-Core Assembly Machine
11 (2) Cooling Towers
12 Air Compressor with Dryer
13 Furniture and Computers
14 Conveyors
15 (2) Fork Lifts
16 Serpentine Core Assembly Machine
17 Helium Leak Tester
18 Storage Racks
19 Floor Scrubber
20 Trash Compactor
21 TIG Welder
22 Bus Bar
All other furniture, furnishings, machinery, equipment and other personal
property owned by The Industrial Development Board of the City of ▇▇▇▇▇▇▇▇▇▇ or
by Alcool, Inc. and located on the Real Property described in Exhibit A hereto
and used in connection with the operation of the manufacturing facilities
located thereon.