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EXHIBIT 4.2(c)
NEVADA
DEED OF TRUST, ASSIGNMENT OF LEASES AND
RENTS, SECURITY AGREEMENT, FIXTURE FILING
AND FINANCING STATEMENT
BY
PIONEER CHLOR ALKALI COMPANY, INC.
(Taxpayer I.D. No. 51-0302028),
as Trustor
TO
First American Title Insurance Company of Nevada,
as Deed of Trust Trustee
FOR THE BENEFIT OF
UNITED STATES TRUST COMPANY OF NEW YORK,
as Collateral Agent
(Taxpayer I.D. No. 13-3818954),
as Beneficiary
Dated as of June 17, 1997
THIS INSTRUMENT COVERS, AMONG OTHER PROPERTY, GOODS WHICH ARE OR MAY
BECOME FIXTURES ON CERTAIN REAL PROPERTY DESCRIBED ON EXHIBIT A HERETO,
AND IS TO BE FILED FOR RECORD IN THE REAL ESTATE RECORDS AS BOTH A DEED OF
TRUST OF REAL PROPERTY AND A FIXTURES FINANCING STATEMENT UNDER THE
UNIFORM COMMERCIAL CODE.
A CARBON, PHOTOGRAPHIC, FACSIMILE OR OTHER REPRODUCTION OF THIS INSTRUMENT
IS SUFFICIENT AS A FINANCING STATEMENT.
THIS INSTRUMENT CONTAINS AFTER-ACQUIRED PROPERTY PROVISIONS, SECURES
PAYMENT OF FUTURE ADVANCES AND COVERS PROCEEDS OF COLLATERAL.
THE MAXIMUM PRINCIPAL AMOUNT SECURED BY THIS DEED OF TRUST IS $300,000,000
(SEE SECTION III).
WHEN RECORDED OR FILED RETURN TO:
United States Trust Company of New York
114 West 47th Street
New York, New York 10036
Attention: Corporate Trust Department
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DEED OF TRUST, ASSIGNMENT OF LEASES AND
RENTS, SECURITY AGREEMENT, FIXTURE FILING
AND FINANCING STATEMENT
THIS DEED OF TRUST, ASSIGNMENT OF LEASES AND RENTS, SECURITY
AGREEMENT, FIXTURE FILING AND FINANCING STATEMENT (this "Deed of Trust"), dated
as of June 17, 1997, by and between PIONEER CHLOR ALKALI COMPANY, INC., a
Delaware corporation, whose address for notice hereunder is 700 Louisiana
Street, Suite 4200, Houston, Texas 77002 ("Trustor") to First American Title
Insurance Company of Nevada, a Nevada corporation having an address at 3760
Pecos- McLeod, Suite #7, Las Vegas, Nevada 89121, as trustee (the "Deed of
Trust Trustee"), in favor of UNITED STATES TRUST COMPANY OF NEW YORK, with
offices at 114 West 47th Street, New York, New York 10036, as Collateral Agent
under the Intercreditor Agreement (as hereinafter defined) (in such capacity
and together with any successors and assigns in such capacity, "Beneficiary"),
for (i) itself, as Trustee under the Indenture (as hereinafter defined) (in
such capacity, the "Note Trustee"), (ii) for the Term Loan Agent (as
hereinafter defined) as agent under the Term Loan Agreement (as hereinafter
defined), (iii) for the Note Holders (as hereinafter defined), and (iv) for the
Term Loan Lenders (as hereinafter defined) (the Beneficiary, the Note Trustee,
the Term Loan Agent, the Note Holders and the Term Loan Lenders being
hereinafter collectively referred to as the "Secured Parties").
W I T N E S S E T H :
WHEREAS, pursuant to that certain Indenture dated as of the
date hereof among Pioneer Americas Acquisition Corp. ("PAAC"), the Subsidiary
Guarantors, as defined therein, and the Note Trustee, as trustee for the
holders of the Notes (as hereinafter defined) (the "Note Holders") (as the same
may be amended, amended and restated, supplemented or otherwise modified from
time to time, the "Indenture") PAAC will issue its 9 1/4% Senior Secured Notes
due 2007 (as the same may be amended, amended and restated, supplemented or
otherwise modified from time to time, including all notes issued in exchange or
substitution therefor, upon the registration of such notes pursuant to the
Securities Act of 1933 or otherwise, the "Notes") in the aggregate principal
amount of $200 million; and
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WHEREAS, pursuant to that certain Term Loan Agreement dated as
of the date hereof among PAAC, Bank of America Illinois, as administrative
agent (the "Term Loan Agent"), DLJ Capital Funding, Inc., as syndication agent,
Salomon Brothers Holding Company Inc, as documentation agent, and the lenders
named therein (the "Term Loan Lenders") (as the same may be amended, amended
and restated, supplemented or otherwise modified from time to time, the "Term
Loan Agreement"), the Term Loan Lenders will make certain loans to PAAC to be
evidenced by notes (as the same may be amended, amended and restated,
supplemented or otherwise modified from time to time, including all notes
issued in exchange or substitution therefor, the "Term Loan Notes") in an
aggregate amount of $100 million; and
WHEREAS, pursuant to Article Thirteen of the Indenture,
Trustor has guaranteed (such guarantee by Trustor being hereinafter referred to
as the "Note Guarantee") the payment and performance of the Indenture
Obligation (as hereinafter defined); and
WHEREAS, pursuant to the Subsidiary Guaranty dated as of the
date hereof (as the same may be amended, amended and restated, supplemented or
otherwise modified from time to time), Trustor has guaranteed (such guarantee
by Trustor being hereinafter referred to as the "Term Loan Guarantee") the
payment and performance of the Term Loan Obligation (as hereinafter defined);
and
WHEREAS, Beneficiary is the collateral agent under that
certain Intercreditor and Collateral Agency Agreement (as the same may be
amended, amended and restated, supplemented or otherwise modified from time to
time, the "Intercreditor Agreement"), dated as of the date hereof, among PAAC,
Trustor, Pioneer Americas, Inc. ("PAI" and together with PAAC and Trustor
sometimes referred to herein as the "Companies"), the Note Trustee, the Term
Loan Agent and Beneficiary, as collateral agent.
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SECTION I - GRANTING CLAUSES
To secure the Secured Obligations (as hereinafter defined),
including, without limitation, Trustor's guarantees of payment and performance
of the Indenture Obligation and the Term Loan Obligation under the Note
Guarantee and the Term Loan Guarantee, respectively, and the payment and
performance of the covenants and obligations herein contained and in
consideration of the sum of $10.00 and other valuable consideration in hand
paid by Beneficiary to Trustor and in consideration of the debts and trusts
hereinafter mentioned, the receipt and sufficiency of all of which is hereby
acknowledged, Trustor does by these presents GRANT, BARGAIN, SELL, ASSIGN,
MORTGAGE, WARRANT, TRANSFER and CONVEY unto the Deed of Trust Trustee and its
successors and substitutes in trust with power of sale hereunder for the use
and benefit of Beneficiary all of Trustor's rights, titles, interests and
estates in and to the real and personal property described in Subparagraphs (a)
through (h) of this Section I (collectively herein called the "Mortgaged
Property"); provided, however, that the term Mortgaged Property shall not
include any Obligor Collateral, as such term is defined in the Revolving Credit
Agreement (as hereinafter defined)), to-wit:
(a) Trustor's undivided 100% interest in and to the lands
described on Exhibit A hereto (the "Land"), together with any and all
other rights, titles and interests of Trustor of whatever kind or
character (whether now owned or hereafter acquired by operation of law
or otherwise) in and to such Land.
(b) All of Trustor's rights, titles and interests in all
plants, buildings, structures, towers and other improvements now owned
or hereafter acquired and located on the Land, including, without
limitation, that certain chlor alkali plant and all equipment,
fixtures, heating, lighting and power plants, pipelines, transmission
lines, buildings, housing and improvements, together with all other
machinery, equipment, appliances and apparatus of whatsoever character
or description (except for any motor vehicles, licensed or registered
with the Department of Motor Vehicles of the State), and all
replacements, substitutions and additions to said property, owned by
Trustor and located on the Land or located elsewhere and used in the
operation, conduct and maintenance of that certain chlor alkali plant
located thereon (collectively, the "Improvements") (the Land, together
with the Improvements, being hereinafter collectively referred to as
the "Chlor Alkali Plant").
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(c) To the extent permitted by law, all of Trustor's rights,
titles and interests in, to and under all franchises, licenses,
permits and certificates, consents, approvals, authorizations, however
characterized, used or held for use in connection with Trustor's
ownership and operation of the Chlor Alkali Plant and issued or in any
way furnished, whether now existing or hereafter entered into and
whether necessary or not for the operation and use of the Chlor Alkali
Plant, including, without limitation, building permits, certificates
of occupancy, environmental certificates, industrial permits or
licenses or certificates of operation.
(d) All of Trustor's rights, title and interest in all
absorbers, equipment, machinery, drums, engines, motors, regulators,
meters, exchangers, tanks, docks, racks, heaters, above ground storage
facilities, under ground storage facilities, loading facilities,
fractionation facilities, absorption equipment, distillation
equipment, deethanizers, depropanizers, debutanizers, olefin
splitters, stills, power plants, disposal pits, warehouses, dwelling
houses, cooling equipment, compressors, pipelines, piping flow lines,
wiring, boilers, vessels, dehydration equipment or any of them (except
for any motor vehicles, licensed or registered with the Department of
Motor Vehicles of the State), whether now owned or hereafter acquired
and located or to be located upon the Land or leaseholds now or
hereafter owned by Trustor and used or held for use in connection with
Trustor's ownership and operation of the Chlor Alkali Plant
(collectively, "Equipment").
(e) All Trustor's right, title and interest, as landlord,
franchisor, licensor or grantor, in all leases and subleases of space,
oil, gas and mineral leases, franchise agreements, licenses, occupancy
or concession agreements now existing or hereafter entered into
relating in any manner to the Chlor Alkali Plant or the Equipment and
any and all amendments, modifications, supplements and renewals of any
thereof (each such lease, license or agreement, together with any such
amendment, modification, supplement or renewal, a "Lease"), whether
now in effect or hereafter
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coming into effect including, without limitation, all rents,
additional rents, management fees payable by tenants, cash,
guarantees, letters of credit, bonds, sureties or securities deposited
thereunder to secure performance of the lessee's, franchisee's,
licensee's or obligee's obligations thereunder, revenues, earnings,
profits and income, advance rental payments, payments incident to
assignment, sublease or surrender of a Lease, claims for forfeited
deposits and claims for damages, now due or hereafter to become due,
with respect to any Lease (collectively, "Rents").
(f) All surveys, title insurance policies, drawings,
plans, specifications, construction contracts, file materials,
operating and maintenance records, catalogues, tenant lists,
correspondence, advertising materials, operating manuals, warranties,
guaranties, appraisals, studies and data relating to the Chlor Alkali
Plant or the Equipment or the construction of any Alteration (as
hereinafter defined) or the maintenance of any Permit (as hereinafter
defined).
(g) All general intangibles now owned or hereafter
acquired by Trustor (but not including the Obligor Collateral),
including without limitation (i) all of Trustor's rights, titles and
interests, whether now owned or hereafter acquired, of Trustor in, to
and under the contracts, agreements or other instruments and documents
relevant to Trustor's ownership and operation of the Chlor Alkali
Plant (collectively, "Plant Agreements"), (ii) all contract rights
relating to the Chlor Alkali Plant or the Equipment and all reserves,
deferred payments, deposits, refunds and claims of every kind or
character relating thereto, but not including Accounts Receivable, as
defined in the Revolving Credit Agreement (collectively, "Contract
Rights") and (iii) all processes, designs, methodologies and related
documentation, technical information, manufacturing, engineering and
technical drawings related to the ownership and operation of the Chlor
Alkali Plant.
(h) All proceeds of the conversion, voluntary or involuntary,
of any of the foregoing into cash or liquidated claims, including,
without limitation, proceeds of insurance and condemnation or other
awards or payments with respect thereto and interest thereon
(collectively, "Proceeds").
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TO HAVE AND TO HOLD the Mortgaged Property unto the Deed of
Trust Trustee and Beneficiary and to their successors and assigns forever to
secure the payment and performance of the Secured Obligations.
SECTION II - SECURITY INTEREST
(a) With respect to all personal property (both tangible and
intangible) and any fixtures constituting a part of the Mortgaged Property,
this Deed of Trust shall likewise be a security agreement and a financing
statement and for valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, and for the purpose of further securing payment of the
Secured Obligations, Trustor hereby grants to Beneficiary a security interest
in all of Trustor's rights, titles and interests in and to the Mortgaged
Property insofar as the Mortgaged Property consists of equipment, contract
rights, general intangibles, documents, instruments, chattel paper, fixtures
and any and all other personal property of any kind or character defined in and
subject to the provisions of the Uniform Commercial Code as in effect in the
State (the "Uniform Commercial Code"), including the proceeds, profits, rents,
revenues and products from any and all of such personal property. Upon the
occurrence and during the continuance of any Event of Default (as hereinafter
defined), Beneficiary is and shall be entitled to all of the rights, powers and
remedies afforded a secured party by the Uniform Commercial Code with reference
to the personal property and fixtures in which Beneficiary has been granted a
security interest herein, or the Deed of Trust Trustee or Beneficiary may
proceed as to both the real and personal property covered hereby in accordance
with the rights and remedies granted under this Deed of Trust in respect of the
real property covered hereby. Such rights, powers and remedies shall be
cumulative and in addition to those granted to the Deed of Trust Trustee or
Beneficiary under any other provision of this instrument or under any other
instrument executed in connection with or as security for the Secured
Obligations. A carbon or photographic or other reproduction of this Deed of
Trust shall be sufficient as a financing statement covering the Mortgaged
Property.
(b) Trustor shall, forthwith after the execution and
delivery of this Deed of Trust and thereafter, from time to time,
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cause this Deed of Trust and any financing statement, continuation statement or
similar instrument relating to any thereof or to any property intended to be
subject to the Lien of this Deed of Trust to be filed, registered and recorded
in such manner and in such places as may be required by any present or future
law in order to publish notice of and fully to protect the validity and
priority thereof or the Lien hereof upon the Mortgaged Property and the
interest and rights of the Deed of Trust Trustee and Beneficiary herein and
therein. Trustor shall pay or cause to be paid all taxes and fees incident to
such filing, registration and recording, all expenses incident to the
preparation, execution and acknowledgment thereof, and of any instrument of
further assurance, and all federal or State stamp taxes or other taxes, duties
and charges arising out of or in connection with the execution and delivery of
such instruments.
(c) Trustor shall, at the sole cost and expense of
Trustor, do, execute, acknowledge and deliver all and every such further acts,
deeds, conveyances, deeds of trust, mortgages, assignments, notices of
assignment, transfers, financing statements, continuation statements and
assurances as the Deed of Trust Trustee or Beneficiary shall from time to time
reasonably request which may be necessary in the requesting party's judgment to
assure, perfect, convey, assign, mortgage, transfer and confirm unto the Deed
of Trust Trustee or Beneficiary the property and rights hereby conveyed or
assigned, or which Trustor may be or may hereafter become bound to convey or
assign to Beneficiary or which may facilitate the performance of the terms of
this Deed of Trust or the filing, registering or recording of this Deed of
Trust. In the event Trustor shall fail to execute any instrument required to be
executed by Trustor pursuant to this subsection II(c), Beneficiary may execute
the same as the attorney-in-fact for Trustor, such power of attorney being
coupled with an interest and irrevocable.
SECTION III - SECURED OBLIGATIONS
This Deed of Trust is executed and delivered by Trustor to
secure the payment and performance of the obligations (collectively, the
"Secured Obligations") described below:
(a) Any and all indebtedness, obligations and liabilities of
Trustor now or hereafter existing under or in
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respect of the Note Guarantee, including, without limitation, payment of
principal, premium, if any, interest and Liquidated Damages (as defined in the
Indenture), if any, when due and payable, and all other amounts due or to
become due under or in connection with the Indenture (including, without
limitation, all sums due to the Note Trustee pursuant to Section 606 thereof),
the Notes and the performance of all other obligations to the Note Trustee and
the Note Holders under the Indenture and the Notes, according to the terms
thereof (collectively, the "Indenture Obligation);
(b) Any and all indebtedness, obligations and liabilities of
Trustor now or hereafter existing under or in respect of the Term Loan
Guarantee, including, without limitation, payment of principal, premium, if
any, and interest when due and payable, and all other amounts due or to become
due under or in connection with the Term Loan Agreement (including without
limitation, all sums due to the Term Loan Agent pursuant to Sections 10.3 and
10.4 thereof) and the Term Loan Notes and the performance of all other
obligations to the Term Loan Agent and the Term Loan Lenders under the Term
Loan Agreement and the Term Loan Notes according to the terms thereof
(collectively, the "Term Loan Obligation");
(c) Any sums which may be advanced or paid by Beneficiary
under the terms hereof on account of the failure of Trustor to comply with the
covenants of Trustor contained herein;
(d) All covenants, agreements, and obligations of Trustor
herein contained; and
(e) All renewals, rearrangements, increases,
substitutions and extensions, and all amendments, supplements and
modifications, to any of the obligations described in the preceding clauses (a)
through (d).
This Deed of Trust secures all future advances and obligations
constituting Secured Obligations. This Deed of Trust also secures future
advances, as defined in NRS 106.320 and is to be governed by NRS 106.300 to
106.400, inclusive. Notwithstanding anything to the contrary contained herein,
the maximum principal amount to be secured hereby is $300 million. The maximum
amount of advances of principal to be secured by this Deed of Trust may
increase or decrease from time to time by amendment to this Deed of Trust.
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SECTION IV - REPRESENTATIONS, WARRANTIES AND COVENANTS
Trustor hereby represents, warrants and covenants as follows:
(a) Good Title; Authority and Validity. Trustor has good and
marketable title to the Mortgaged Property and the landlord's interest and
estate under or in respect of the Leases, subject to the Excepted Liens, and
has, in all material respects, full corporate power and lawful authority to
bargain, grant, sell, mortgage, assign, transfer, convey and grant a security
interest in all of the Mortgaged Property all in the manner and form herein
provided and without obtaining the waiver, consent or approval of any lessor,
sublessor, Governmental Authority or entity or other party whomsoever or
whatsoever which has not been obtained, except in the case of certain
environmental permits and approvals which, by their terms, are not transferable
or cannot be transferred without the prior approval of the issuing agency. The
Improvements upon the Land are all within the boundary lines of the Land or
have the benefit of valid easements, and there are no encroachments thereon
that would materially impair the use thereof. The Mortgaged Property is free
and clear of any and all Liens or encumbrances of any nature or kind except for
the Excepted Liens and the Leases. Trustor has all necessary permits,
franchises, licenses, rights-of-way, servitudes or other rights or authority
needed in connection with the operation and maintenance of the Chlor Alkali
Plant, except where the failure to have the same would not have a Material
Adverse Effect; all of the Plant Agreements are presently in full force and
effect and no default has occurred or exists thereunder, except where such
default would not individually or in the aggregate have a Material Adverse
Effect; except as provided in the Excepted Liens, Trustor's grant of a Lien and
security interest in the Mortgaged Property in the manner herein provided does
not result in the creation or imposition of any other Lien or security
interest, adverse claim or option upon any of the Mortgaged Property. Trustor's
chief executive office and chief place of business is located at the address
set forth in the initial paragraph of this Deed of Trust. Trustor will not
change its name, identity or corporate structure or its chief executive
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office or chief place of business without notifying the Deed of Trust Trustee
and Beneficiary at least thirty (30) days prior to the effective date of such
change.
(b) Defense of Title. Trustor will warrant and defend title to
the Mortgaged Property, subject to Excepted Liens, against the claims and
demands of all other Persons whomsoever and will maintain and preserve the Lien
created hereby so long as any of the Secured Obligations secured hereby remains
unpaid. Should an adverse claim be made against the title to any material part
of the Mortgaged Property, Trustor agrees it will immediately notify
Beneficiary in writing thereof and defend against such adverse claim to the
extent necessary to preserve the Deed of Trust Trustee's and Beneficiary's
rights and benefits hereunder, subject to Excepted Liens, and Trustor further
agrees that the Deed of Trust Trustee and/or Beneficiary may take such other
reasonable action as they deem advisable to protect and preserve their
interests in the Mortgaged Property, and in such event Trustor will indemnify
the Deed of Trust Trustee and Beneficiary against any and all costs, reasonable
attorney's fees and other expenses which they may incur in defending against
any such adverse claim. Such obligations shall be payable on demand and shall
bear interest from the date of demand therefor until paid at the Note Rate. Any
proceeds of any policy of title insurance maintained by Trustor with respect to
the Mortgaged Property shall, for the purposes of this Deed of Trust, be paid
and applied in the same manner as Insurance Proceeds (as hereinafter defined).
(c) First Lien. This Deed of Trust is, and always will be
kept, a direct first Lien and security interest upon the Mortgaged Property,
subject to the Excepted Liens, and Trustor will not create or suffer to be
created or permit to exist any Lien, security interest or charge prior or
junior to or on parity with the Lien and security interest of this Deed of
Trust upon the Mortgaged Property or any part thereof or upon the rents,
issues, revenues, profits or other income therefrom, except for the Excepted
Liens.
(d) Maintenance of Mortgaged Property. Trustor will at its own
expense do or cause to be done all things necessary to preserve and keep in
full repair, working order and efficiency, reasonable wear and tear excepted,
all of the Mortgaged Property, including, without limitation, all equipment,
machinery and
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facilities, and from time to time will make all the needful and proper repairs,
renewals and replacements so that at all times the state and condition of the
Mortgaged Property will be fully preserved and maintained, unless the failure
to repair, renew or replace would not materially interfere with the present use
or operation of the Mortgaged Property.
(e) Performance of Contracts; Operation of Plant. Trustor will
promptly pay and discharge all rentals, or other payments and will perform or
cause to be performed each and every act, matter or thing required by, each and
all of the contracts, instruments or agreements executed in connection with or
incident to the ownership and operation of the Chlor Alkali Plant (including
without limitation the Plant Agreements) and being a portion of the Mortgaged
Property and will do all other things necessary to keep unimpaired Trustor's
rights with respect thereto and to prevent any forfeiture thereof or default
thereunder, unless such forfeiture or default would not individually or in the
aggregate have a Material Adverse Effect. Trustor will operate the facilities
comprising the Chlor Alkali Plant in a good and workmanlike manner and in
accordance with the practices of the industry and in compliance in all material
respects with all Governmental Requirements affecting ownership and operation
of such facilities, including without limitation, Environmental Laws.
(f) Payment by the Trustee and/or Beneficiary. Trustor agrees
that if Trustor fails to perform any act or to take any action which Trustor is
required to perform or take hereunder or pay any money which Trustor is
required to pay hereunder (taking into account applicable grace or cure
periods), the Deed of Trust Trustee and/or Beneficiary in Trustor's name or its
own name may, but shall not be obligated to, during the continuance of an Event
of Default, perform or cause to perform such act or take such action or pay
such money, and any expenses so incurred by the Deed of Trust Trustee or
Beneficiary and any money so paid by the Deed of Trust Trustee or Beneficiary
shall be a demand obligation owing by Trustor to the Deed of Trust Trustee or
Beneficiary, and the Deed of Trust Trustee or Beneficiary, upon making such
payment, shall be subrogated to all of the rights of the Person receiving such
payment. Each amount due and owing by Trustor to holders of the Secured
Obligations and/or the Deed of Trust Trustee pursuant to this Deed of Trust
shall bear interest from the date of such expenditure or payment
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or other occurrence which gives rise to such amount being owed to the Deed of
Trust Trustee or Beneficiary until paid at the Note Rate, and all such amounts
together with such interest thereon shall be a part of the Secured Obligations
and shall be secured by this Deed of Trust.
(g) Name of Trustor. Trustor does not do business with respect
to the Mortgaged Property under any name other than Pioneer Chlor Alkali
Company, Inc.
(h) Operation by Third Parties. To the extent any of the
Mortgaged Property is operated by a party or parties other than Trustor,
Trustor's covenants as expressed in this Section IV are modified to require
that Trustor use its best efforts (including without limitation the reasonable
exercise of all rights and remedies as are available to Trustor) to obtain
compliance with such covenants by the operator or operators of the Mortgaged
Property.
(i) Compliance with Laws. The Chlor Alkali Plant complies
in all material respects with all local zoning, land use, setback and other
development, use and occupancy requirements of governmental authorities except
for possible nonconforming uses or violations which do not and will not
materially interfere with the present use, operation or maintenance thereof as
now used, operated or maintained.
(j) Payment of Taxes, Insurance Premiums, Assessments;
Compliance with Law and Insurance Requirements. (i) Unless contested in
accordance with the provisions of subsection IV(j)(v) hereof, Trustor shall pay
and discharge or cause to be paid and discharged, from time to time when the
same shall become due, all real estate and other taxes, special assessments,
levies, permits, inspection and license fees, all premiums for insurance, all
water and sewer rents and charges, and all other public charges imposed upon or
assessed against the Mortgaged Property or any part thereof or upon the
revenues, rents, issues, income and profits of the Mortgaged Property,
including, without limitation, those arising in respect of the occupancy, use
or possession thereof.
(ii) During the continuance of an Event of Default, Trustor shall
deposit with Beneficiary, on the first day of each month, an amount reasonably
estimated by Trustor to be equal to
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one-twelfth (1/12th) of the annual taxes, assessments and other items required
to be discharged by Trustor under subsection IV(j)(i) and amounts reasonably
estimated by Trustor to be necessary to maintain the insurance coverages
contemplated in subsection IV(l) below, which estimates shall not be less than
one-twelfth (1/12th) of the annual taxes, assessments, insurance premiums and
other items required to be discharged by Trustor during the year immediately
preceding the year during which such Event of Default occurred. Such amounts
shall be held by Beneficiary without interest to Trustor and applied to the
payment of each obligation in respect of which such amounts were deposited, in
such order or priority as Beneficiary shall determine, on or before the date on
which such obligation would become delinquent. If at any time the amounts so
deposited by Trustor shall, in Beneficiary's judgment, be insufficient (when
added to the installments anticipated to be paid thereafter) to discharge any
of such obligations when due, Trustor shall, immediately upon demand, deposit
with Beneficiary such additional amounts as may be requested by Beneficiary.
Nothing contained in this subsection IV(j) shall affect any right or remedy of
the Deed of Trust Trustee or Beneficiary under any provision of this Deed of
Trust or of any statute or rule of law to pay any such amount from its own
funds (provided, however, that neither the Deed of Trust Trustee nor
Beneficiary shall in any event be obligated to pay any of such amounts from its
own funds) and to add the amount so paid, together with interest at the Note
Rate, to the Secured Obligations, or relieve Trustor of its obligations to make
or provide for the payment of the annual taxes, assessments and other charges
required to be discharged by Trustor under subsection IV(j)(i). Trustor hereby
grants to Beneficiary a security interest in all sums held pursuant to this
subsection IV(j)(ii) to secure payment and performance of the Secured
Obligations. During the continuance of any Event of Default, Beneficiary may
apply all or any part of the sums held pursuant to this subsection IV(j)(ii) to
payment and performance of the Secured Obligations in accordance with the
provisions of the Intercreditor Agreement. Trustor shall redeposit with
Beneficiary an amount equal to all amounts so applied as a condition to the
cure, if any, of such Event of Default, in addition to fulfillment of any other
required conditions.
(iii) Unless contested in accordance with the provisions of
subsection IV(j)(v), Trustor shall timely pay (or obtain a bond in the amount
of) all lawful claims and demands of
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mechanics, materialmen, laborers, warehousemen, employees, suppliers,
government agencies administering worker's compensation insurance, old age
pensions and social security benefits and all other claims, judgments, demands
or amounts of any nature which, if unpaid or not bonded, could result in or
permit the creation of a Lien (other than an Excepted Lien) on the Mortgaged
Property or any part thereof or the Rents arising therefrom, or which might
result in forfeiture of all or any part of the Mortgaged Property.
(iv) Trustor shall maintain, or cause to be maintained, in full force
and effect, all permits, certificates, authorizations, consents, approvals,
registrations, filings, licenses, franchises or other instruments now or
hereafter required by any Governmental Authority to operate or use and occupy
the Chlor Alkali Plant and the Equipment for its intended uses (collectively,
the "Permits"; each, a "Permit"), unless the failure to maintain such Permits
would not individually or in the aggregate have a Material Adverse Effect.
Trustor represents that, to its knowledge and subject to those requirements for
notice, approval or reissuance set forth by applicable law, none of the Permits
will be subject to cancellation, forfeiture or any limitation on the scope
thereof solely by virtue of the execution of this Deed of Trust or the
foreclosure of the Lien hereof. Unless contested in accordance with the
provisions of subsection IV(j)(v), Trustor shall comply promptly with, or cause
prompt compliance with, all requirements set forth in the Permits and all
Governmental Requirements applicable to all or any part of the Mortgaged
Property or the condition, use or occupancy of all or any part thereof or any
recorded deed of restriction, declaration, covenant running with the land or
otherwise, now or hereafter in force unless the compliance therewith would not
individually or in the aggregate have a Material Adverse Effect. Trustor shall
not initiate or consent to any change in the zoning, subdivision or any other
use classification of the Land, if such action could have a material adverse
effect on the Lien of this Deed of Trust or materially impair the present use
and operation of the Mortgaged Property or materially impair Beneficiary's
rights or benefits hereunder, without the prior written consent of Beneficiary.
(v) Trustor may at its own expense contest the amount or
applicability of any of the obligations described in subsections IV(j)(i),
IV(j)(iii) and IV(j)(iv) by appropriate
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legal proceedings, prosecution of which operates to prevent the collection or
enforcement thereof or the sale or forfeiture of the Mortgaged Property or any
part thereof to satisfy such obligations; provided, however, that (A) any such
contest shall be conducted in good faith by appropriate legal proceedings
promptly instituted and diligently conducted and (B) in connection with such
contest, Trustor shall have made provision for the payment or performance of
such contested obligation on Trustor's books if and to the extent required by
generally accepted accounting principles then utilized by Trustor in the
preparation of its financial statements, or shall have deposited with
Beneficiary a sum sufficient to pay and discharge such obligation and
Beneficiary's estimate of all interest and penalties related thereto.
Notwithstanding the foregoing provisions of this subsection IV(j)(v), (A) no
contest of any such obligations may be pursued by Trustor if such contest would
expose the Deed of Trust Trustee, Beneficiary, or any other Secured Party to
any possible criminal liability or, unless Trustor shall have furnished an
Additional Undertaking (as hereinafter defined) therefor satisfactory to the
Deed of Trust Trustee, Beneficiary, or such other Secured Party, as the case
may be, any civil liability for failure to comply with such obligations and (B)
if at any time payment or performance of any obligation contested by Trustor
pursuant to this subsection IV(j)(v) shall become necessary to prevent the
delivery of a tax or similar deed conveying the Mortgaged Property or any
portion thereof because of nonpayment or nonperformance, Trustor shall pay or
perform the same in sufficient time to prevent the delivery of such tax or
similar deed.
(vi) Trustor shall not in its use and occupancy of the Chlor Alkali
Plant or the Equipment (including, without limitation, in the making of any
Alteration) take any action that would cause the termination, revocation or
denial of any insurance coverage required to be maintained under this Deed of
Trust or that pursuant to written notice from any applicable insurer, would be
the basis for a defense to any claim under any insurance policy maintained in
respect of the Chlor Alkali Plant or the Equipment and Trustor shall otherwise
comply in all material respects with the requirements of any insurer that
issues a policy of insurance in respect of the Chlor Alkali Plant or the
Equipment.
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(vii) Trustor shall, promptly upon receipt of any written notice
regarding any failure by Trustor to pay or discharge any of the obligations
described in subsection IV(j)(i) or (vi), furnish a copy of such notice to
Beneficiary. Trustor shall, promptly upon receipt of any written notice
regarding any failure by Trustor to pay or discharge any of the obligations
described in subsection IV(j)(iii) or (iv), furnish a copy of such notice to
Beneficiary, if such failure would have a Material Adverse Effect.
(k) Certain Tax Law Changes. In the event of the passage after
the date of this Deed of Trust of any law deducting from the value of real
property, for the purpose of taxation, amounts in respect of any Lien thereon
or changing in any way the laws for the taxation of deeds of trust or debts
secured by deeds of trust for state or local purposes or the manner of the
collection of any such taxes, and imposing a new tax, either directly or
indirectly, on this Deed of Trust or the interest of any Secured Party in any
Mortgaged Property (other than income, franchise or similar taxes imposed on
such Secured Party), Trustor shall promptly pay such Secured Party such amount
or amounts as may be necessary from time to time to pay such tax.
(l) Required Insurance Policies. (i) Trustor shall maintain,
or cause to be maintained, in full force and effect the following insurance
coverages in respect of the Chlor Alkali Plant and the Equipment:
(A) Physical hazard insurance on an "all risk" basis covering
hazards commonly covered by fire and extended coverage, lightning,
civil commotion, hail, riot, strike, water damage, sprinkler leakage,
collapse and malicious mischief, in an amount equal to the full
replacement cost of the Improvements and all Equipment, with such
deductibles as would be maintained by a prudent operator of property
similar in use and configuration to the Chlor Alkali Plant and located
in the locality where the Chlor Alkali Plant is located. "Full
replacement cost" means the cost of construction to replace the
Improvements and the Equipment, exclusive of depreciation, excavation,
foundation and footings, as determined from time to time by a proper
officer of Trustor in consultation with its insurance company or
insurance agent, as appropriate;
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(B) Comprehensive general liability insurance against claims
for bodily injury, death or property damage occurring on, in or about
the Chlor Alkali Plant and any adjoining streets, sidewalks and
passageways and covering any and all claims, including, without
limitation, all legal liability, subject to customary exclusions, to
the extent insurable, imposed upon Beneficiary or any Secured Party
and all court costs and attorneys' fees, arising out of or connected
with the possession, use, leasing, operation or condition of the Chlor
Alkali Plant, with policy limits and deductibles in such amounts as
would be maintained by a prudent operator of property similar in use
and configuration to the Chlor Alkali Plant and located in the
locality where the Chlor Alkali Plant is located;
(C) Workers' compensation insurance as required by the laws of
the State to protect Trustor against claims for injuries sustained in
the course of employment at the Chlor Alkali Plant;
(D) Comprehensive boiler and machinery insurance to cover
sudden and accidental breakdown, including but not limited to,
explosion of any boilers and machinery located on the Chlor Alkali
Plant or comprising any Equipment, with policy limits and deductibles
in such amounts as would be maintained by a prudent operator of
property similar in use and configuration to the Chlor Alkali Plant
and the Equipment and located in the locality where the Chlor Alkali
Plant is located;
(E) Comprehensive automobile liability insurance policy
against claims for bodily injury, death and property damage covering
all owned, leased, non-owned and hired motor vehicles, including
loading and unloading in such amounts as would be maintained by a
prudent operator of property similar in use and configuration to the
Chlor Alkali Plant and the Equipment and located in the locality where
the Chlor Alkali Plant is located;
(F) Business interruption insurance on an annual basis in
amounts not less than the projected gross profit of the Chlor Alkali
Plant during the applicable twelve-month period but in no event less
than the amount necessary to pay the fixed charges and other expenses
of owning, operating and maintaining the Mortgaged Property for the
same period;
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(G) To the extent not otherwise covered by the insurance
required under clauses (A) and (B) of this subsection IV(l)(i), during
the performance of any alterations, renovations, repairs, restorations
or construction, broad form Builders Risk Insurance on an all-risk
completed value basis; and
(H) Such other insurance, against such risks and with policy
limits and deductibles in such amounts as would be maintained by a
prudent operator of property similar in use and configuration to the
Chlor Alkali Plant and located in the locality in which the Chlor
Alkali Plant is located.
(ii) Trustor may maintain the coverages required by this
subsection IV(l) under blanket policies covering the Chlor Alkali Plant and
other locations owned or operated by Trustor if the terms of such blanket
policies otherwise comply with the provisions of this subsection IV(l) and
contain specific coverage allocations in respect of the Chlor Alkali Plant
determined in accordance with the provisions of this subsection IV(l). All
insurance policies in respect of the coverages required by subsections
IV(l)(i)(A), IV(l)(i)(D), IV(l)(i)(G) and, if applicable, IV(l)(i)(H) shall be
in amounts at least sufficient to prevent coinsurance liability and all losses
thereunder shall be payable to Beneficiary, as loss payee, subject to the terms
of the Intercreditor Agreement, pursuant to a standard noncontributory New York
mortgage endorsement or local equivalent, and each such policy shall, to the
extent obtainable at commercially reasonable costs, (A) include effective
waivers (whether under the terms of such policy or otherwise) by the insurer of
all claims for insurance premiums against all loss payees and named insureds
other than Trustor and all rights of subrogation against any named insured, and
(B) provide that any losses thereunder shall be payable notwithstanding (1) any
act, failure to act, negligence of, or violation or breach of warranties,
declarations or conditions contained in such policy by Trustor or Beneficiary
or any other named insured or loss payee, (2) the occupation or use of the
Chlor Alkali Plant or the Equipment for purposes more hazardous than permitted
by the terms of the policy, (3) any foreclosure or other proceeding or notice
of sale relating to the Chlor Alkali Plant or the Equipment or
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(4) any change in the title to or ownership or possession of the Chlor Alkali
Plant or the Equipment; provided, however, that (with respect to items
contemplated in clauses (3) and (4) above) any notice requirements of the
applicable policies are satisfied. All insurance policies in respect of the
coverages required by subsections IV(l)(i)(B), IV(l)(i)(E) and, if applicable,
IV(l)(i)(H) shall name Beneficiary as an additional insured. Each policy of
insurance required under this subsection IV(l) shall provide that (A) notices
of any failure by Trustor to pay any insurance premium in respect thereof, be
furnished to Beneficiary contemporaneously with any such notice given to
Trustor and (B) it may not be cancelled or otherwise terminated without at
least twenty (20) days' prior written notice to Beneficiary and shall permit
Beneficiary to pay any premium therefor within twenty (20) days after receipt
of any notice stating that such premium has not been paid when due. The policy
or policies of such insurance or certificates of insurance evidencing the
required coverages and all renewals or extensions thereof shall be delivered to
Beneficiary upon receipt by Trustor. Settlement of any claim under any of the
insurance policies referred to in this subsection IV(l) (other than the
insurance contemplated in clause(C) of this subsection IV(l)(i)) which in
Trustor's reasonable judgment involves loss of $1,000,000 or more, shall
require the prior approval of Beneficiary (acting pursuant to the provisions of
the Intercreditor Agreement) and Trustor shall use its best efforts to cause
each such insurance policy to contain a provision to such effect.
(iii) At least fifteen (15) days prior to the expiration of
any insurance policy required by this subsection IV(l), Trustor shall deliver
to Beneficiary evidence that such policy or policies shall be renewed or
extended and Trustor shall deliver promptly to Beneficiary after receipt
thereof the policy or policies renewing or extending such expiring policy or
renewal or extension certificates or other evidence of renewal or extension,
together with a receipt showing payment of the premium thereof.
(iv) Trustor shall not purchase additional policies in respect
of the insurance coverages required to be maintained under this subsection
IV(l), unless Beneficiary is included thereon as an additional named insured
and, if applicable, with loss payable to Beneficiary under an endorsement
containing the
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provisions described in subsection IV(l)(ii) and the policy evidencing such
insurance otherwise complies with the requirements of subsection IV(l)(ii).
Trustor immediately shall notify Beneficiary whenever any such separate
insurance policy is obtained and promptly shall deliver to Beneficiary the
policy or certificate evidencing such insurance.
(m) Inspection. Trustor shall permit Beneficiary, by its
agents, accountants and attorneys, to visit and inspect the Mortgaged Property
upon reasonable prior notice at such times as may be reasonably requested by
Beneficiary.
(n) Trustor To Maintain Improvements. Trustor shall not commit
any waste on the Chlor Alkali Plant or with respect to any Equipment or make
any change in the use of the Chlor Alkali Plant or any Equipment. Trustor
represents and warrants that (i) to Trustor's knowledge, the Chlor Alkali Plant
is served by all electric, gas, sewer, water facilities and any other utilities
required or necessary for the current use thereof and any easements or
servitudes necessary to the furnishing of such utility service by Trustor have
been obtained and duly recorded, and (ii) Trustor has access to the Chlor
Alkali Plant from public roads sufficient to allow Trustor and its tenants and
invitees to conduct its and their businesses at the Chlor Alkali Plant as it is
currently conducted. Trustor shall not materially alter the occupancy or use of
the Chlor Alkali Plant without the prior written consent of Beneficiary. Except
as otherwise permitted by the Intercreditor Agreement no Improvements
comprising a portion of the Chlor Alkali Plant may be demolished nor shall any
Equipment be removed without the prior written consent of Beneficiary.
(o) Leases. (i) All of the Leases are valid and effective in
accordance with their respective terms, except that the enforcement thereof may
be subject to (i) bankruptcy, insolvency, reorganization, moratorium or other
similar law affecting or relating to enforcement of creditors' rights
generally, and (ii) general equitable principles. To Trustor's knowledge,
Trustor is not in material breach of or in default (and to Trustor's knowledge,
no event has occurred which with due notice or lapse of time or both, may
constitute such a material breach or default) under any Lease, and no party to
any Lease has given Trustor written notice of or made a claim with respect to
any breach or default, the consequences of which, individually or in the
aggregate, would have a Material Adverse Effect on Trustor.
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(ii) Trustor shall manage and operate the Mortgaged Property
or cause the Mortgaged Property to be managed and operated in a reasonably
prudent manner and, except as otherwise permitted under subsection IV(p), will
not enter into any Lease (or any amendment or modification thereof) or other
agreement subsequent to the date hereof with any Person which, in the
reasonable judgment of Trustor, individually or in the aggregate, would have a
Material Adverse Effect on the value of the property subject thereto.
(iii) Trustor shall not:
(A) receive or collect, or permit the receipt or collection
of, any rental or other payments under any Lease more than one (1)
month in advance of the respective period in respect of which they are
to accrue, except that (a) in connection with the execution and
delivery of any Lease or of any amendment to any Lease, rental
payments thereunder may be collected and received in advance in an
amount not in excess of one (1) month's rent and (b) Trustor may
receive and collect escalation and other charges in accordance with
the terms of each Lease;
(B) assign, transfer or hypothecate (other than to Beneficiary
hereunder or as otherwise permitted under subsection IV(p) of this
Deed of Trust) any rental or other payment under any Lease whether
then due or to accrue in the future, the interest of Trustor as lessor
under any Lease or the rents, issues, revenues, profits or other
income of the Mortgaged Property;
(C) enter into any Lease after the date hereof that does not
contain terms to the effect as follows:
(1) such Lease and the rights of the tenant
thereunder shall be subject and subordinate to the rights of
Beneficiary under and the Lien of this Deed of Trust;
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(2) such Lease has been assigned as collateral
security by Trustor as landlord thereunder to Beneficiary
under this Deed of Trust;
(3) in the case of any foreclosure hereunder, the
rights and remedies of the tenant in respect of any
obligations of any successor landlord thereunder shall be
limited to the equity interest of such successor landlord in
the Chlor Alkali Plant and any successor landlord shall not
(a) be liable for any act, omission or default of any prior
landlord under the Lease or (b) be required to make or
complete any tenant improvements or capital improvements or
repair, restore, rebuild or replace the demised premises or
any part thereof in the event of damage, casualty or
condemnation or (c) be required to pay any amounts to tenant
arising under the Lease prior to such successor landlord
taking possession;
(4) the tenant's obligation to pay rent and any
additional rent shall not be subject to any abatement,
deduction, counterclaim or setoff as against Beneficiary or
any purchaser upon the foreclosure of any portion of the Chlor
Alkali Plant or the giving or granting of a deed in lieu
thereof by reason of a landlord default occurring prior to
such foreclosure, and Beneficiary or such purchaser will not
be bound by any advance payments of rent in excess of one
month or any security deposits unless such security was
actually received; and
(5) the tenant agrees to attorn, at the option of
Beneficiary or any purchaser of the Chlor Alkali Plant, to the
successor owner upon a foreclosure of the Chlor Alkali Plant
or the giving or granting of a deed in lieu thereof; and
(D) terminate or permit the termination of any Lease of space,
accept surrender of all or any portion of the space demised under any
Lease prior to the end of the term thereof or accept assignment of any
Lease to Trustor which, in the reasonable judgment of Trustor,
individually or in the aggregate, would have a Material Adverse Effect
or materially impair the Lien of this Deed of Trust therein unless:
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(1) the tenant under such Lease has not paid the
equivalent of two months' rent and Trustor has made reasonable
efforts to collect such rent; or
(2) Trustor shall deliver to Beneficiary an Officers'
Certificate to the effect that Trustor has entered into a new
Lease (or Leases) for the space covered by the terminated or
assigned Lease with a term (or terms) which expire(s) no
earlier than the date on which the terminated or assigned
Lease was to expire (excluding renewal options), and with a
tenant (or tenants) having a creditworthiness (as reasonably
determined by Trustor) sufficient to pay the rent and other
charges due under the new Lease (or Leases), and the tenant(s)
shall have commenced paying rent, including, without
limitation, all operating expenses and other amounts payable
under the new Lease (or Leases), without any abatement or
concession, in an amount at least equal to the amount which
would have then been payable under the terminated or assigned
Lease.
(iv) Trustor timely shall perform and observe all the terms,
covenants and conditions required to be performed and observed by Trustor under
each Lease and will not engage in any conduct in respect of any Lease which
would have individually or in the aggregate a Material Adverse Effect or
materially impair the Lien of this Deed of Trust or the security interest
created hereby. Trustor promptly shall notify Beneficiary of the receipt of any
notice from any lessee under any Lease claiming that Trustor is in material
default in the performance or observance of any of the terms, covenants or
conditions thereof to be performed or observed by Trustor and will cause a copy
of each such notice to be delivered promptly to Beneficiary.
(p) Transfer Restrictions. Except as otherwise permitted by
the Intercreditor Agreement, Trustor shall not, without the prior written
consent of Beneficiary, further mortgage, encumber, hypothecate, sell, convey
or assign all or any part of the Mortgaged Property or suffer any of the
foregoing to occur by operation of law or otherwise (each a "Transfer");
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provided, however, Trustor may so encumber the Mortgaged Property to the extent
such encumbrances are of the kind listed in clause (e) of the definition of
"Excepted Liens". Any proceeds of such permitted Transfer shall be deemed
Collateral Proceeds (as such term is defined in the Indenture) and are hereby
assigned and shall be paid to Beneficiary to be held in the Collateral Account
and disbursed pursuant to the Intercreditor Agreement.
(q) Destruction; Condemnation.
(i) Destruction; Insurance Proceeds. If there shall occur any
damage to, or loss or destruction of, the Improvements and Equipment, or any
part of any thereof (each, a "Destruction"), Trustor shall promptly send to
Beneficiary a notice setting forth the nature and extent of such Destruction.
The proceeds of any insurance payable in respect of any such Destruction are
hereby assigned and shall be paid to Beneficiary to be held in the Collateral
Account; provided, however, that so long as no Event of Default shall have
occurred and be continuing, if such proceeds are in an amount less than
$1,000,000, such proceeds shall be paid directly to Trustor. All insurance
proceeds paid to Beneficiary pursuant to this subsection, less the amount of
any expenses incurred in litigating, arbitrating, compromising or settling any
claim arising out of such Destruction (the "Insurance Proceeds"), shall
constitute Trust Moneys and be applied in accordance with the provisions of
subsections IV(q)(iii), IV(q)(iv) and IV(q)(v).
(ii) Condemnation; Assignment of Award. If there shall occur
any taking of the Mortgaged Property or any part thereof, in or by condemnation
or other eminent domain proceedings pursuant to any law, general or special, or
by reason of the temporary requisition of the use or occupancy of the Mortgaged
Property or any part thereof, by any governmental authority, civil or military
(each, a "Taking"), Trustor immediately shall notify Beneficiary upon receiving
notice of such Taking or commencement of proceedings therefor. Beneficiary may
(but shall not be obligated to) participate in any proceedings or negotiations
which might result in any Taking. Beneficiary may be represented by counsel
satisfactory to it at the expense of Trustor. Trustor shall deliver or cause to
be delivered to Beneficiary all instruments requested by it to permit such
participation. Trustor shall in good faith and with due diligence file and
prosecute what would otherwise be
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Trustor's claim for any such award or payment and cause the same to be
collected and paid over to Beneficiary, and hereby irrevocably authorizes and
empowers Beneficiary, in the name of Trustor as its true and lawful
attorney-in-fact or otherwise, during the continuance of an Event of Default to
collect and to receipt for any such award or payment, and, in the event Trustor
fails so to act, to file and prosecute such claim. Trustor shall pay all costs,
fees and expenses incurred by Beneficiary in connection with any Taking and
seeking and obtaining any award or payment on account thereof. Any proceeds,
award or payment in respect of any Taking are hereby assigned and shall be paid
to Beneficiary to be held in the Collateral Account; provided, however, that so
long as no Event of Default shall have occurred and be continuing, if such
proceeds are in an amount less than $1,000,000, such proceeds shall be paid
directly to Trustor. Trustor shall take all steps necessary to notify the
condemning authority of such assignment. Such proceeds, award or payment paid
to Beneficiary, less the amount of any expenses incurred in litigating,
arbitrating, compromising or settling any claim arising out of such Taking
("Net Award"), shall constitute Trust Moneys and be applied in accordance with
the provisions of subsections IV(q)(iii), IV(q)(iv) and IV(q)(v).
(iii) Payment or Restoration. So long as no Event of Default
shall have occurred and be continuing, Trustor shall have the right, at
Trustor's option, to require Beneficiary to apply such Net Award or Insurance
Proceeds to the payment of the Secured Obligations, in accordance with the
Intercreditor Agreement or to perform a restoration (each, a "Restoration") of
the affected portions of the Chlor Alkali Plant and the Equipment. In the event
that Trustor elects to make such payment, such Net Award or Insurance Proceeds
shall be delivered to the Beneficiary to be held as Trust Moneys subject to
withdrawal and application by Beneficiary in accordance with the provisions of
the Intercreditor Agreement. In the event Trustor elects to perform a
Restoration, Trustor shall give written notice ("Restoration Election Notice")
of such election to Beneficiary within twenty (20) business days after the date
that Beneficiary receives the applicable Insurance Proceeds or Net Award, as
the case may be. Trustor shall, within twenty (20) business days following the
date of delivery of a Restoration Election Notice, commence and diligently
continue to perform the Restoration of that portion or portions of the Chlor
Alkali Plant and Equipment subject to such Destruction or affected by such
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Taking so that, upon the completion of the Restoration, the Mortgaged Property
shall be in the same condition and shall be of at least equal utility for its
intended purposes as the Mortgaged Property was immediately prior to such
Destruction or Taking. Trustor shall so complete such Restoration with its own
funds to the extent that the amount of any Net Award or Insurance Proceeds is
insufficient for such purpose. In the event Beneficiary does not receive a
Restoration Election Notice within such twenty (20) business day period,
Beneficiary shall apply such Insurance Proceeds or Net Award to the payment of
the Secured Obligations, in accordance with the provisions of the Intercreditor
Agreement.
(iv) Restoration. In the event a Restoration is to be
performed under this subsection IV(q)(iv), Beneficiary shall not release any
part of the Net Award or the Insurance Proceeds except in accordance with the
provisions of subsection IV(q)(v) and Trustor shall, prior to commencing any
work to effect a Restoration of the Chlor Alkali Plant and the Equipment,
promptly (but in no event later than one-hundred twenty (120) days following
any Destruction or Taking) furnish to Beneficiary:
(A) complete plans and specifications (the "Plans and
Specifications") for the Restoration;
(B) an officers' certificate stating that all permits and
approvals required by law to commence work in connection with the
Restoration have been obtained;
(C) a certificate (an "Architect's Certificate") of an
independent, reputable architect or engineer acceptable to Beneficiary
and licensed in the State (1) stating that the Plans and
Specifications have been reviewed and approved by the signatory
thereto, (2) containing such signatory's estimate (an "Estimate") of
the costs of completing the Restoration, and (3) upon completion of
such Restoration in accordance with the Plans and Specifications, the
utility of the Chlor Alkali Plant and the Equipment will be equal to
or greater than the utility thereof immediately prior to the
Destruction or Taking relating to such Restoration; and
(D) if the Estimate exceeds the Insurance Proceeds or the Net
Award, as the case may be, by $5,000,000 or more, an Additional
Undertaking in an amount equal to not less than the Estimate less the
amount of the Insurance Proceeds or
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the Net Award, as the case may be, then held by Beneficiary for
application toward the cost of such Restoration.
Upon receipt by Beneficiary of each of the items required
pursuant to clauses (A) through (D) above, Beneficiary shall acknowledge
receipt of the Plans and Specifications. Promptly upon such acknowledgment of
receipt by Beneficiary, Trustor shall commence and diligently continue to
perform the Restoration substantially in accordance with such Plans and
Specifications and in material compliance with all Governmental Requirements,
free and clear of all Liens except Excepted Liens. Trustor shall so complete
such Restoration with its own funds to the extent that the amount of any Net
Award or Insurance Proceeds is insufficient for such purpose.
(v) Restoration Advances Following Destruction or Taking of
Mortgaged Property. In the event Trustor performs a Restoration of the Chlor
Alkali Plant and Equipment as provided in subsection IV(q)(iv), Beneficiary
shall apply any Insurance Proceeds or Net Award held by Beneficiary on account
of the Destruction or Taking to the payment of the cost of performing such
Restoration pursuant to the relevant provisions of the Intercreditor Agreement.
In the event there shall be any surplus after application of the Net Award or
the Insurance Proceeds to Restoration of the Chlor Alkali Plant and the
Equipment, such surplus shall become Net Proceeds, as defined in the Indenture
and shall be paid by Beneficiary to the Note Trustee for application in
accordance thereunder; provided, however, that if an Event of Default shall
have occurred and be continuing, such surplus shall be applied by Beneficiary
to the payment of the Secured Obligations, in accordance with Article 6 of the
Intercreditor Agreement. Notwithstanding anything to the contrary herein, if a
Destruction or Taking of all or substantially all of the Mortgaged Property
occurs on a date which is less than 12 months prior to Maturity, as such term
is defined in the Indenture, all Insurance Proceeds and Net Awards shall be
applied to the permanent repayment or prepayment of any Secured Obligations
then outstanding in accordance with the Intercreditor Agreement.
(r) Alterations. Trustor shall not make any material
structural addition, modification or change (each, an "Alteration") to the
Chlor Alkali Plant or the Equipment which would materially diminish the utility
of the Mortgaged Property
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or impair the Lien of this Deed of Trust thereon. Whether or not Beneficiary
has consented to the making of any Alteration, Trustor shall (i) complete each
Alteration promptly, in a good and workmanlike manner and in material
compliance with all applicable local laws, ordinances and requirements and (ii)
pay when due all claims for labor performed and materials furnished in
connection with such Alteration, unless contested in accordance with the
provisions of subsection IV(j)(v).
(s) Hazardous Material.
(i) Except with respect to those matters which would not
reasonably be expected to have a Material Adverse Effect, Trustor holds all
Permits required to permit Trustor to conduct its business in the manner now
conducted and none of the Trustor's operations are being conducted in a manner
that violates in any material respect the terms and conditions under which any
such Permit was granted, including without limitation, under any Environmental
Laws; all such Permits are valid and in full force and effect; and to the
knowledge of Trustor, no suspension, cancellation, revocation or termination of
any such Permit is threatened.
(ii) Except as set forth in the Term Loan Agreement, there are
no material claims, actions, suits, proceedings or investigations pending or to
the knowledge of Trustor, threatened, before any Governmental Authority or
before any arbitrator brought by or against Trustor or with respect to any of
the Mortgaged Property the basis of which is any Environmental Law.
(iii) Trustor shall (or shall cause other parties obligated to
do so under contract or indemnity to) (A) take all commercially reasonable
actions to comply with any and all applicable present and future Environmental
Laws relating to the Chlor Alkali Plant; (B) pay in a timely fashion the cost
of any removal, response measure or corrective action relating to any Hazardous
Materials required by any Environmental Law or any order, regulation, consent
decree or similar agreement or instrument and keep the Mortgaged Property free
of any Lien imposed pursuant to any Environmental Law; (C) take all
commercially reasonable actions to not release, discharge or dispose of any
Hazardous Materials on, under or from the Mortgaged Property in violation of
any Environmental Law;
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(D) apply any insurance proceeds or other sums received by it in respect of the
removal of any Hazardous Material or any other corrective action relating to
any Hazardous Material to such removal or corrective action; and (E) not take,
or fail to take any action with respect to any Environmental Laws or in
connection with any Hazardous Materials that could reasonably be expected to
result in the incurrence of any obligation or liability of any Secured Party.
During the continuance of an Event of Default, in the event Trustor fails to
comply with the covenants in the preceding sentence, Beneficiary may (upon
receipt of an indemnity satisfactory to Beneficiary), in addition to any other
remedies set forth herein, but shall not be obligated to, as trustee for and at
Trustor's sole cost and expense cause to be taken, any remediation, removal,
response or corrective action relating to Hazardous Materials that is required
by Environmental Law and is not being done or contested by Trustor. Any costs
or expenses incurred by Beneficiary for such purpose shall be immediately due
and payable by Trustor and shall bear interest at the Note Rate. Trustor shall
provide to Beneficiary and its agents and employees access to the Mortgaged
Property to take any action required by Environmental Laws, or in connection
with any Hazardous Materials, that could be expected to result in the
incurrence of any obligation or liability of any Secured Party, if Trustor
fails to do so and such action or removal is required under any Environmental
Laws as provided above. Upon written request by Beneficiary, which shall
include a reasonably specific statement of the basis thereof (which shall be
specific to the condition of the Mortgaged Property and the alleged violation
of Environmental Law) and which shall be made not more frequently than once in
any twelve-month period or at any time that Beneficiary is exercising its
remedies under this Deed of Trust, Beneficiary shall have the right (upon
receipt of an indemnity satisfactory to Beneficiary), but shall not be
obligated, at the sole cost and expense of Trustor, to conduct an environmental
audit or review of the Mortgaged Property relating to the specific items as
required in writing or relating to the remedy that Beneficiary is exercising
under this Deed of Trust by persons or firms appointed by Beneficiary, and
Trustor shall cooperate in all reasonable respects in the conduct of such
environmental audit or review, including, without limitation, by providing
reasonable access to the Mortgaged Property and to all records relating
thereto. Such audit or review shall be conducted in a manner that would not
reasonably be expected to impose any additional material obligation upon, or
materially
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increase any obligation of, ICI Delaware Holdings, Inc. or its successors
("ICI") under that certain Purchase Agreement, dated August 29, 1988, between
ICI and Pioneer Chlor Alkali Holdings, Inc., as amended October 25, 1988 (as
amended, the "ICI Agreement"), with respect to Hazardous Materials at the
Mortgaged Property. Trustor shall indemnify and hold the Secured Parties
harmless from and against all loss, cost, damage or expense (including, without
limitation, attorneys' fees) that any Secured Party may sustain by reason of
the assertion against such party of any claim relating to such Hazardous
Materials or actions taken with respect thereto as authorized hereunder.
Nothing contained herein shall result in any Secured Party being deemed an
"owner" or "operator" under applicable Environmental Law.
(iv) Trustor may at its own expense contest the amount or
applicability of any of the obligations described in the first sentence of
subsection IV(s)(iii) by appropriate legal proceedings, prosecution of which
operates to prevent the enforcement thereof; provided, however, that (A) any
such contest shall be conducted in good faith by appropriate legal proceedings
promptly instituted and diligently conducted and (B) in connection with such
contest, Trustor shall have made provision for the payment or performance of
such contested obligation on Trustor's books if and to the extent required by
generally accepted accounting principles then utilized by Trustor in the
preparation of its financial statements, or shall have deposited with
Beneficiary a sum sufficient to pay and discharge such obligation and
Beneficiary's estimate of all interest and penalties related thereto.
Notwithstanding the foregoing provisions of this subsection IV(s)(iv), no
contest of any such obligations may be pursued by Trustor if such contest would
expose the Deed of Trust Trustee, Beneficiary, or any other Secured Party to
any possible criminal liability or, unless Trustor shall have furnished an
Additional Undertaking (as hereinafter defined) therefor satisfactory to the
Deed of Trust Trustee, Beneficiary or such other Secured Party, as the case may
be, any civil liability for failure to comply with such obligations.
(t) Asbestos. Trustor shall not install nor permit to be
installed in the Mortgaged Property friable asbestos or any asbestos-containing
material (collectively, "ACM") except in compliance with all applicable
Environmental Laws respecting such material. With respect to any ACM currently
present in the
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Mortgaged Property, except with respect to matters which would not have a
Material Adverse Effect, Trustor shall comply with all federal, state or local
laws, regulations or orders applicable to ACM located on the Chlor Alkali
Plant, all at Trustor's sole cost and expense. If Trustor shall fail so to
comply with such laws or regulations, Beneficiary may (upon receipt of an
indemnity satisfactory to Beneficiary) during the continuance of an Event of
Default, but shall not be obligated to, in addition to any other remedies set
forth herein, take those steps reasonably necessary to comply with applicable
law, regulations or orders. Any costs or expenses incurred by Beneficiary for
such purpose shall be immediately due and payable by Trustor and bear interest
at the Note Rate. Trustor shall provide to Beneficiary and its agents and
employees reasonable access to the Mortgaged Property upon reasonable prior
notice to remove such ACM if Trustor fails to do so and removal is required
under any Environmental Law as provided for above; provided, however, that
nothing contained herein shall obligate Beneficiary to exercise any rights
under such license. Trustor shall indemnify and hold the Secured Party harmless
from and against all loss, cost, damage and expense that any Secured Party may
sustain as a result of the presence of any ACM and any removal thereof in
compliance with any applicable Environmental Law.
(u) Books and Records; Reports. Trustor shall keep proper
books of record and account, which shall accurately represent the financial
condition of Trustor and the business affairs of Trustor relating to the
Mortgaged Property. Beneficiary and its authorized representatives shall have
the right, from time to time, upon reasonable prior notice to examine the books
and records of Trustor relating to the operation of the Mortgaged Property at
the office of Trustor.
(v) No Claims Against Beneficiary. Nothing contained in this
Deed of Trust shall constitute any consent or request by Beneficiary, express
or implied, for the performance of any labor or services or the furnishing of
any materials or other property in respect of the Chlor Alkali Plant or any
part thereof, nor as giving Trustor any right, power or authority to contract
for or permit the performance of any labor or services or the furnishing of any
materials or other property in such fashion as would permit the making of any
claim against Beneficiary in respect thereof or any claim that any Lien based
on the performance of
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such labor or services or the furnishing of any such materials or other
property is prior to the Lien of this Deed of Trust.
(w) Utility Services. Trustor shall pay, or cause to be paid,
when due all charges for all public or private utility services, all public or
private rail and highway services, all public or private communication
services, all sprinkler systems, and all protective services, any other
services of whatever kind or nature at any time rendered to or in connection
with the Chlor Alkali Plant or any part thereof, shall comply in all material
respects with all contracts relating to any such services, and shall do all
other things reasonably required for the maintenance and continuance of all
such services to the extent required to fulfill the obligations set forth in
subsection IV(n).
(x) Notwithstanding any provisions herein to the contrary,
Trustor shall retain the right, at all times prior to foreclosure (or
deed-in-lieu thereof), to exercise custody and control with respect to actions
to be taken at the Mortgaged Property relating to the environmental condition
thereof, but only to the extent Trustor's exercise of such custody and control
of the Mortgaged Property is necessary for Trustor and/or its affiliates to
retain any and all benefits inuring to Trustor and/or its affiliates under the
indemnification provided by ICI in Section 8.02 of the ICI Agreement.
SECTION V - ASSIGNMENT OF LEASES, RENTS, ISSUES AND PROFITS
(a) Trustor absolutely, presently and irrevocably assigns,
transfers and sets over to Beneficiary and grants to Beneficiary, subject to
the terms and conditions hereof, all Trustor's estate, right, title and
interest (the "Trustor's Interest") in the Leases including, without
limitation, the following:
(i) the immediate and continuing right to receive and collect
Rents payable by all tenants or other parties pursuant to Leases;
(ii) all claims, rights, powers, privileges and remedies of
Trustor, whether provided for in any Lease or arising by statute or at
law or in equity or otherwise, consequent on any failure on the part
of any tenant to perform or comply with any term of any Lease;
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(iii) all rights to take all actions upon the happening of a
default under any Lease as shall be permitted by such Lease or by law,
including, without limitation, the commencement, conduct and
consummation of proceedings at law or in equity; and
(iv) the full power and authority, in the name of Trustor or
otherwise, to enforce, collect, receive and receipt for any and all of
the foregoing and to do any and all other acts and things whatsoever
which Trustor or any landlord is or may be entitled to do under the
Leases.
(b) Any Rents receivable by Beneficiary hereunder, after
payment of all proper costs and charges, shall be applied, in accordance with
the Intercreditor Agreement, to all amounts due and owing with respect to the
Secured Obligations. Beneficiary shall be accountable to Trustor only for Rents
actually received by Beneficiary pursuant to this assignment. The collection of
such Rents and the application thereof shall not cure or waive any Event of
Default or waive, modify or affect notice of an Event of Default or invalidate
any act done pursuant to such notice.
(c) So long as no Event of Default shall have occurred and be
continuing, Trustor shall have a license to collect and apply the Rents and to
enforce the obligations of tenants under the Leases. Immediately upon the
occurrence and during the continuance of any Event of Default, the license
granted in the immediately preceding sentence shall cease and terminate, with
or without any notice, action or proceeding. Upon such Event of Default and
during the continuance thereof, Beneficiary may (but shall not be obligated to)
to the fullest extent permitted by the Leases (i) exercise any of Trustor's
rights under the Leases, (ii) enforce the Leases, (iii) demand, collect, sue
for, attach, levy, recover, receive, compromise and adjust, and make, execute
and deliver receipts and releases for all Rents or other payments that may then
be or may thereafter become due, owing or payable with respect to the Leases
and (iv) generally do, execute and perform any other act, deed, matter or thing
whatsoever that ought to be done, executed and performed in and about or with
respect to the Leases, as fully as allowed or authorized by the Trustor's
Interest.
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(d) During the continuance of an Event of Default, Trustor
hereby irrevocably authorizes and directs the tenant under each Lease to pay
directly to, or as directed by, Beneficiary all Rents accruing or due under its
Lease. Trustor hereby authorizes the tenant under each Lease to rely upon and
comply with any notice or demand from Beneficiary for payment of Rents to
Beneficiary and Trustor shall have no claim against any tenant for Rents paid
by such tenant to Beneficiary pursuant to such notice or demand.
(e) Trustor at its sole cost and expense shall enforce all
material provisions of the Leases in accordance with their terms. Neither this
Deed of Trust nor any action or inaction on the part of Beneficiary shall
release any tenant under any Lease, any guarantor of any Lease or Trustor from
any of their respective obligations under the Leases or constitute an
assumption of any such obligation on the part of Beneficiary. No action or
failure to act on the part of Trustor shall adversely affect or limit the
rights of Beneficiary under this Deed of Trust or, through this Deed of Trust,
under the Leases.
(f) All rights, powers and privileges of Beneficiary herein
set forth are coupled with an interest and are irrevocable, subject to the
terms and conditions hereof, and Trustor shall not take any action under the
Leases or otherwise which is inconsistent with this Deed of Trust or any of the
terms hereof and any such action inconsistent herewith or therewith shall be
void. Trustor shall, from time to time, upon request of Beneficiary, execute
all instruments and further assurances and all supplemental instruments and
take all such action as Beneficiary from time to time may reasonably request in
order to perfect, preserve and protect the interests intended to be assigned to
Beneficiary hereby.
(g) Trustor shall not, unilaterally or by agreement,
subordinate, amend, modify, extend, discharge, terminate, surrender, waive or
otherwise change any term of any of the Leases in any manner which would
violate this Deed of Trust. If the Leases shall be amended as permitted hereby,
they shall continue to be subject to the provisions hereof without the
necessity of any further act by any of the parties hereto.
(h) Nothing contained herein shall operate or be construed to
(i) obligate the Deed of Trust Trustee or
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Beneficiary to perform any of the terms, covenants or conditions contained in
the Leases or otherwise to impose any obligation upon the Deed of Trust Trustee
or Beneficiary with respect to the Leases (including, without limitation, any
obligation arising out of any covenant of quiet enjoyment contained in the
Leases in the event that any tenant under a Lease shall have been joined as a
party defendant in any action by which the estate of such tenant shall be
terminated) or (ii) place upon the Deed of Trust Trustee or Beneficiary any
responsibility for the operation, control, care, management or repair of any
portion of the Mortgaged Property.
(i) Beneficiary may also, at any time after an Event of
Default, or pursuant to NRS Section 32.015, under the circumstances described
in NRS Section 40.507, apply to any court of competent jurisdiction for the
appointment of a receiver and Trustor agrees that such appointment shall be
made upon a prima facie showing of a claimed Event of Default without reference
to any offsets or defenses against such Event of Default. Such receiver shall
have all the rights and powers provided to Beneficiary pursuant to this section
or otherwise provided hereunder or by law. Said receiver may borrow monies and
issue certificates therefor. Said certificates shall be a lien on the Mortgaged
Property subordinate only to this Deed of Trust and the Leases; provided,
however, that should any of said certificates be acquired by Beneficiary the
amount thereof shall constitute additional indebtedness secured hereby. Such
receiver may lease all or any portion of the Mortgaged Property on such terms
and for such a term (which may extend beyond the terms of such receiver's
appointment and/or, if Beneficiary so consents, sale of the Mortgaged Property
hereunder) as such receiver may deem appropriate in its sole and absolute
discretion. The entering upon and taking possession of the Mortgaged Property
pursuant to this section and the collection of the Rents, issues and profits
therefrom shall not cure or waive any Event of Default or notice of an Event of
Default hereunder or invalidate any act of Beneficiary pursuant thereto.
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SECTION VI - EVENTS OF DEFAULT
(a) Events of Default. As used in this Deed of Trust,
"Event of Default" shall mean the occurrence of an Event of Default under the
Indenture or the Term Loan Agreement or a breach or violation of the terms of
this Deed of Trust.
(b) Remedies. Upon the occurrence and during the continuance
of any Event of Default, in addition to any other rights and remedies
Beneficiary may have pursuant to this Deed of Trust or as provided by law, and
without limitation, Beneficiary may, subject to the terms of the Intercreditor
Agreement, take such action, without notice or demand, as it deems advisable
and is permitted by law to protect and enforce its rights against Trustor and
in and to the Mortgaged Property, including, but not limited to, the following
actions, each of which may be pursued concurrently or otherwise, at such time
and in such manner as Beneficiary may determine, in its sole discretion,
without impairing or otherwise affecting the other rights and remedies of
Beneficiary, except to the extent otherwise provided by law:
(i) (A) Beneficiary shall have the right and option to proceed
with foreclosure by directing the Deed of Trust Trustee, or its
successors or substitutes in trust, to proceed with foreclosure and to
sell or offer for sale the Mortgaged Property in such manner as
permitted or required by applicable law relating to the sale of real
estate or by the Uniform Commercial Code relating to the sale of
collateral after default by a debtor (as such applicable laws and
Uniform Commercial Code now exist or as may be hereafter amended), or
by any other present or subsequent articles or enactments relating to
the sale of real estate or collateral; provided, however, that nothing
contained in this subsection VI(b)(i) shall be construed so as to
limit in any way the Deed of Trust Trustee's rights to sell the
Mortgaged Property, or any portion thereof, by private sale if, and to
the extent that, such private sale is permitted under the laws of the
State or by public or private sale after entry of a judgment by any
court of competent jurisdiction so ordering.
(B) Trustor agrees to surrender possession of the hereinabove
described Mortgaged Property to the purchaser at the aforesaid sale,
immediately after such sale, in the
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event such possession has not previously been surrendered by Trustor.
Upon receipt of the sale price in the case of a third party purchase
or upon the crediting of the applicable portion of the Secured
Obligations to the sales price if the purchaser is Beneficiary, the
Deed of Trust Trustee is hereby authorized, empowered and directed to
make due conveyance to the purchaser or purchasers, with general
warranty binding upon Trustor and the heirs, successors and assigns of
Trustor. The right of sale hereunder shall not be exhausted by one or
more such sales, and the Deed of Trust Trustee may make other and
successive sales until all of the Mortgaged Property be legally sold
or all of the Secured Obligations shall have been paid. Trustor hereby
irrevocably appoints the Deed of Trust Trustee to be the attorney of
Trustor and in the name and on behalf of Trustor to execute and
deliver any deeds, transfers, conveyances, assignments, assurances and
notices which Trustor ought to execute and deliver and do and perform
any and all such acts and things which Trustor ought to do and perform
under the covenants herein contained and generally, to use the name of
Trustor in the exercise of all or any of the powers hereby conferred
on the Deed of Trust Trustee. Recitals contained in any conveyance
made by the Deed of Trust Trustee to any purchaser at any sale made
pursuant hereto shall conclusively establish the truth and accuracy of
the matters therein treated, including, without limiting the
generality of the foregoing, nonpayment of the unpaid principal sum
of, or the interest accrued on, any of the Secured Obligations after
the same has become due and payable, advertisement and conduct of such
sale in the manner provided herein and appointment of any successor
trustee hereunder. The Deed of Trust Trustee or its successor or
substitute may appoint or delegate any one or more persons as agent to
perform any act or acts necessary or incident to any sale held by the
Deed of Trust Trustee, including the posting of notices and the
conduct of sale, but in the name and on behalf of the Deed of Trust
Trustee, his successor or substitute. If the Deed of Trust Trustee or
his successor or substitute shall have given notice of sale hereunder,
any successor or substitute Deed of Trust Trustee thereafter appointed
may complete the sale and the conveyance of the property pursuant
thereto as if such notice had been given by the successor or
substitute Deed of Trust Trustee conducting the sale.
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(C) Subject to Section 2.2(b) of the Intercreditor Agreement,
without limitation on any other provision contained herein,
Beneficiary may, subject to NRS 107.080, declare all sums secured
hereby immediately due by delivery to the Deed of Trust Trustee of a
written notice of breach and election to sell (which notice the Deed
of Trust Trustee shall cause to be recorded and mailed as required by
law).
(D) After three (3) months shall have elapsed following
recordation of any such notice of breach, the Deed of Trust Trustee
shall sell the property subject hereto at such time and at such place
in the State as the Deed of Trust Trustee, in its sole discretion,
shall deem best to accomplish the objects of these trusts, having
first given notice of such sale as then required by law. In the
conduct of any such sale the Deed of Trust Trustee may act itself or
through any auctioneer, agent or attorney. The place of sale may be
either in the county in which the property to be sold, or any part
thereof, is situated, or at an office of the Deed of Trust Trustee
located in the State.
(1) Upon the request of Beneficiary or if required by
law the Deed of Trust Trustee shall postpone sale of all or
any portion of said property or interest therein by public
announcement at the time fixed by said notice of sale, and
shall thereafter postpone said sale from time to time by
public announcement at the time previously appointed.
(2) At the time of sale so fixed, the Deed of Trust
Trustee shall sell the property so advertised or any part
thereof or interest therein either as a whole or in separate
parcels, as Beneficiary may determine in its sole and absolute
discretion, to the highest bidder for cash in lawful money of
the United States, payable at time of sale, and shall deliver
to such purchaser a deed or deeds or other appropriate
instruments conveying the property so sold, but without
covenant or warranty, express or implied. Beneficiary and the
Deed of Trust Trustee may bid and purchase at such sale. To
the extent of the Secured Obligations, Beneficiary need not
bid for cash at any sale of all or any portion of the
Mortgaged Property pursuant hereto, but the amount of any
successful bid by Beneficiary shall be applied
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in reduction of the Secured Obligations. Trustor hereby
agrees, if it is then still in possession, to surrender,
immediately and without demand, possession of said property to
any purchaser.
(ii) (A) Upon the occurrence and during the continuance
of any Event of Default, the Deed of Trust Trustee or Beneficiary
shall have the right and power to proceed by a suit or suits in equity
or at law, whether for the specific performance of any covenant or
agreement herein contained or in aid of the execution of any power
herein granted, or for any foreclosure hereunder or for the sale of
the Mortgaged Property under the judgment or decree of any court or
courts of competent jurisdiction, or for the appointment of a receiver
pending any foreclosure hereunder or the sale of the Mortgaged
Property under the order of a court or courts of competent
jurisdiction or under executory or other legal process, or for the
enforcement of any other appropriate legal or equitable remedy. Any
money advanced by the Deed of Trust Trustee and/or Beneficiary in
connection with any such receivership shall be a demand obligation
(which obligation Trustor hereby expressly promises to pay) owing by
Trustor to the Deed of Trust Trustee and/or Beneficiary and shall bear
interest from the date of making such advance by the Deed of Trust
Trustee and/or Beneficiary until paid at the Note Rate.
(B) Trustor agrees to the full extent that it lawfully may,
that, in case one or more of the Events of Default shall have occurred
and shall not have been remedied, then, and in every such case, the
Deed of Trust Trustee or Beneficiary shall have the right and power to
enter into and upon and take possession of all or any part of the
Mortgaged Property in the possession of Trustor, its successors or
assigns, or its or their agents or servants, and may exclude Trustor,
its successors or assigns, and all persons claiming under Trustor, and
its or their agents or servants wholly or partly therefrom; and,
holding the same, the Deed of Trust Trustee may use, administer,
manage, operate and control the Mortgaged Property and conduct the
business thereof to the same extent as Trustor, its successors or
assigns, might at the time do and may exercise all rights and powers
of Trustor, in the name, place and stead of Trustor, or otherwise as
the Deed of Trust Trustee shall deem best. All
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costs, expenses and liabilities of every character incurred by the
Deed of Trust Trustee and/or Beneficiary in administering, managing,
operating, and controlling the Mortgaged Property shall constitute a
demand obligation (which obligation Trustor hereby expressly promises
to pay) owing by Trustor to the Deed of Trust Trustee and/or
Beneficiary and shall bear interest from date of expenditure until
paid at the Note Rate, all of which shall constitute a portion of the
Secured Obligations and shall be secured by this Deed of Trust and by
any other instrument securing the Secured Obligations. In connection
with any action taken by the Deed of Trust Trustee and/or Beneficiary
pursuant to this subsection (ii), the Deed of Trust Trustee and/or
Beneficiary shall not be liable for any loss sustained by Trustor
resulting from any act or omission of the Deed of Trust Trustee and/or
Beneficiary in administering, managing, operating or controlling the
Mortgaged Property, including a loss arising from the ordinary
negligence of the Deed of Trust Trustee and/or Beneficiary, unless
such loss is caused by its own gross negligence or willful misconduct
and bad faith, nor shall the Deed of Trust Trustee and/or Beneficiary
be obligated to perform or discharge any obligation, duty or liability
of Trustor.
(C) Trustor shall and does hereby agree to indemnify the Deed
of Trust Trustee and/or Beneficiary for, and to hold the Deed of Trust
Trustee and/or Beneficiary harmless from, any and all liability, loss
or damage which may or might be incurred by the Deed of Trust Trustee
and/or Beneficiary by reason of this Deed of Trust or the exercise of
rights or remedies hereunder, including a loss arising from the
ordinary negligence of the Deed of Trust Trustee and/or Beneficiary,
except as such liability, loss or damage is occasioned by the gross
negligence or willful misconduct of such party; should the Deed of
Trust Trustee and/or Beneficiary make any expenditure on account of
any such liability, loss or damage, the amount thereof, including
costs, expenses and reasonable attorneys' fees, shall be a demand
obligation (which obligation Trustor hereby expressly promises to pay)
owing by Trustor to the Deed of Trust Trustee and/or Beneficiary and
shall bear interest from the date expended until paid at the Note
Rate, shall be a part of the Secured Obligations and shall be secured
by this Deed of Trust and any other instrument securing the Secured
Obligations.
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(D) Trustor hereby assents to, ratifies and confirms any and
all actions of the Deed of Trust Trustee and/or Beneficiary with
respect to the Mortgaged Property taken under this paragraph (ii).
(iii) Every right, power and remedy herein given to the Deed
of Trust Trustee and Beneficiary shall be cumulative and in addition
to every other right, power and remedy herein specifically given or
now or hereafter existing in equity, at law or by statute; and each
and every right, power and remedy whether specifically herein given or
otherwise existing may be exercised from time to time and so often and
in such order as may be deemed expedient by the Deed of Trust Trustee
and Beneficiary, and the exercise, or the beginning of the exercise,
of any such right, power or remedy shall not be deemed a waiver of the
right to exercise, at the same time or thereafter any other right,
power or remedy. No delay or omission by the Deed of Trust Trustee or
Beneficiary in the exercise of any right, power or remedy shall impair
any such right, power or remedy or operate as a waiver thereof or of
any other right, power or remedy then or thereafter existing.
(iv) To the extent permitted under applicable law, Beneficiary
shall have the right (but shall not be obligated to) to become the
purchaser at any sale held by the Deed of Trust Trustee or by any
receiver or public officer, whether by power of sale, judicial
procedure or otherwise, and shall have the right (but shall not be
obligated to) to have all or any part of the Secured Obligations then
owing credited against the amount of the bid made by Beneficiary at
such sale.
(v) Upon any sale, whether under the power of sale hereby
given or by virtue of judicial proceedings, it shall not be necessary
for the Deed of Trust Trustee or any public officer acting under
execution or order of court to have physically present or
constructively in his or her possession any of the Mortgaged Property,
and Trustor hereby agrees to deliver all of such personal property to
the purchasers at such sale on the date of sale, and if it
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should be impossible or impracticable to make actual delivery of such
property, then the title and right of possession to such property
shall pass to the purchaser at such sale as completely as if such
property had been actually present and delivered.
(vi) Upon any sale, whether made under the power of sale
hereby given or by virtue of judicial proceedings, the receipt of the
Deed of Trust Trustee, or of the officer making a sale under judicial
proceedings, shall be a sufficient discharge to the purchaser or
purchasers at any sale for his or her or their purchase money, and
such purchaser or purchasers, his or her or their assigns or personal
representatives, shall not, after paying such purchase money and
receiving such receipt of the Deed of Trust Trustee or of such officer
therefor, be obliged to see to the application of such purchase money,
or be in anywise answerable for any loss, misapplication or
nonapplication thereof.
(vii) (A) Any sale or sales of the Mortgaged Property or any
part thereof, whether under the power of sale herein granted and
conferred or under and by virtue of judicial proceedings, shall
operate to divest all right, title, interest, claim and demand
whatsoever, either at law or in equity, of Trustor of, in and to the
premises and the property sold, and shall be a perpetual bar, both at
law and in equity, against Trustor, its successors and assigns, and
against any and all persons claiming or who shall thereafter claim all
or any of the property sold from, through or under Trustor, its
successors and assigns; and Trustor, if requested by the Deed of Trust
Trustee or Beneficiary to do so, shall join in the execution and
delivery of all proper conveyances, assignments and transfers of the
properties so sold.
(B) The proceeds of any sale of the Mortgaged Property or any
part thereof and all other moneys received by the Deed of Trust
Trustee in any proceedings for the enforcement hereof, whose
application has not elsewhere herein been specifically provided for,
shall be applied first, to the payment of all expenses incurred by the
Deed of Trust Trustee or Beneficiary incident to the enforcement of
this Deed of Trust or any of the Secured Obligations (including,
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without limiting the generality of the foregoing, expenses of any
entry or taking of possession, of any sale, of advertisement thereof,
and of conveyances, and court costs, compensation of agents and
employees and reasonable legal fees), and to the payment of all other
charges, expenses, liabilities and advances incurred or made by the
Deed of Trust Trustee or Beneficiary under this Deed of Trust or in
executing any trust or power hereunder; and then to the payment of the
Secured Obligations in such order and manner as is determined by
Beneficiary in its sole discretion, subject to the terms of the
Intercreditor Agreement.
(C) Beneficiary may resort to any security given by this Deed
of Trust or to any other security now existing or hereafter given to
secure the payment of any of the Secured Obligations secured hereby,
in whole or in part, and in such portions and in such order as may
seem best to Beneficiary in its sole discretion, subject to the terms
of the Intercreditor Agreement, and any such action shall not in
anywise be considered as a waiver of any of the rights, benefits or
liens created by this Deed of Trust.
(D) Trustor agrees, to the full extent that it may lawfully so
agree, that it will not at any time insist upon or plead or in any
manner whatever claim or take the benefit or advantage of any
appraisement, valuation, stay, extension or redemption law now or
hereafter in force, in order to prevent or hinder the enforcement or
foreclosure of this Deed of Trust or the absolute sale of the
Mortgaged Property or the possession thereof by any purchaser at any
sale made pursuant to any provision hereof, or pursuant to the decree
of any court of competent jurisdiction; but Trustor, for itself and
all who may claim through or under it, so far as it or they now or
hereafter lawfully may, hereby waives the benefit of all such laws.
Trustor, for itself and all who may claim through or under it, waives
to the extent that it may lawfully do so, any and all right to have
the property included in the Mortgaged Property marshaled upon any
foreclosure of the lien hereof, and agrees that any court having
jurisdiction to foreclose such lien may sell the Mortgaged Property as
an entirety. If any law referred to herein and now in force, of which
Trustor or its successor or successors might take advantage despite
the provisions hereof, shall hereafter be repealed or cease to be in
force,
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such law shall not thereafter be deemed to constitute any part of the
contract herein contained or to preclude the operation or application
of the provisions hereof.
(E) If the proceeds of any sale or other lawful disposition of
the Mortgaged Property by the Deed of Trust Trustee and/or Beneficiary
are insufficient to pay the Secured Obligations, then Trustor shall
pay or cause to be paid any deficiency.
(viii) Without in any manner limiting the generality of any of
the other provisions of this Deed of Trust; (A) some portions of the
goods described or to which reference is made herein are or are to
become fixtures on the land described or to which reference is made
herein; (B) the security interests created hereby under the Uniform
Commercial Code will attach to minerals including oil and gas; (C)
this instrument is to be filed of record in the real estate records as
a financing statement; and (D) Trustor is the record owner of the real
estate or interests in the real estate comprised of the Mortgaged
Property.
(ix) The Mortgaged Property may be sold in one or more parcels
and in such manner and order as Beneficiary, in its sole discretion,
may determine.
(c) Where not inconsistent with paragraph (b) the above,
the following covenants, No., 1; 2 (full replacement value); 3; 4 (20% per
annum); 5; 6; 7 (a reasonable percentage); 8 and 9 of NRS 107.030 are hereby
adopted and made a part of this Deed of Trust.
Beneficiary's exercise of the foregoing remedies will not be
construed to constitute Beneficiary as a mortgagee in possession of the
Mortgaged Property nor to obligate Beneficiary to take any action or to incur
expenses or perform or discharge any obligation, duty or liability of Trustor
under any lease, or for the control, care, management, or repair of the
Mortgaged Property; nor will it operate to make Beneficiary responsible or
liable for any waste committed on the Mortgaged Property by any Person or for
any dangerous or defective condition of the Mortgaged Property, or for any act
or omission relating to the management, upkeep, repair, or control of the
Mortgaged Property that results in loss or injury or death to any Person.
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SECTION VII - THE DEED OF TRUST TRUSTEE
(a) It shall be no part of the duty of the Deed of Trust
Trustee to see to any recording, filing or registration of this Deed of Trust
or any other instrument in addition or supplemental thereto, or to give any
notice thereof, or to see to the payment of or be under any duty in respect of
any tax or assessment or other governmental charge which may be levied or
assessed on the Mortgaged Property, or any part thereof, or against Trustor, or
to see to the performance or observance by Trustor of any of the covenants and
agreements contained herein. The Deed of Trust Trustee shall not be responsible
for the execution, acknowledgment or validity of this Deed of Trust or of any
instrument in addition or supplemental hereto or for the sufficiency of the
security purported to be created hereby, and makes no representation in respect
thereof or in respect of the rights of Beneficiary. The Deed of Trust Trustee
shall have the right to consult with counsel upon any matters arising hereunder
and shall be fully protected in relying as to legal matters on the advice of
counsel. The Deed of Trust Trustee shall not incur any personal liability
hereunder except for the Deed of Trust Trustee's own gross negligence or
willful misconduct; and the Deed of Trust Trustee shall have the right to rely
on any instrument, document or signature authorizing or supporting any action
taken or proposed to be taken by the Deed of Trust Trustee hereunder, believed
by the Deed of Trust Trustee in good faith to be genuine.
(b) The Deed of Trust Trustee may resign by written notice
addressed to Beneficiary (but such resignation shall not be effective until and
unless a successor trustee is appointed by Beneficiary and such successor
trustee accepts the appointment) or be removed at any time with or without
cause by an instrument in writing duly executed on behalf of Beneficiary.
Beneficiary may, at any time, by instrument in writing, appoint a successor or
successors to the Deed of Trust Trustee named herein or acting hereunder, which
instrument, executed and acknowledged by Beneficiary, and recorded in the
appropriate office in the State, shall be conclusive proof of the proper
substitution of such successor trustee, who shall have all the estate, powers,
duties and trusts in the premises vested in or conferred on the original
trustee.
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SECTION VIII - CERTAIN DEFINITIONS
As used herein, the following terms shall have the following
meanings:
"Additional Undertaking" shall mean (a) cash or cash
equivalents or (b) a Surety Bond, an Additional Undertaking Guarantee or an
Additional Undertaking Letter of Credit which is (i) provided by a Person, (ii)
whose long- term unsecured debt is rated at least "AA" (or equivalent) by a
nationally recognized statistical rating agency and (iii) is otherwise
satisfactory to Beneficiary. Additional Undertakings shall be addressed
directly to Beneficiary and shall name Beneficiary as the beneficiary thereof
and the party entitled to make claims thereunder.
"Additional Undertaking Guarantee" shall mean the
unconditional guarantee of payment of any corporation or partnership organized
and existing under the laws of the United States of America or any State or the
District of Columbia or Canada or province thereof that has a long-term
unsecured debt rating satisfactory to Beneficiary at the time such guarantee is
delivered, given to Beneficiary, accompanied by an opinion of counsel to such
guarantor to the effect that such guarantee has been duly authorized, executed
and delivered by such guarantor and constitutes the legal, valid and binding
obligation of such guarantor enforceable against such guarantor by Beneficiary
in accordance with its terms, subject to customary exceptions at the time for
opinions for such instruments, together with an opinion of counsel to the
effect that, taking into account the purpose under this Deed of Trust for which
such guarantee will be given, such guarantee and accompanying opinion are
responsive to the requirements of this Deed of Trust.
"Additional Undertaking Letter of Credit" shall mean a clean,
irrevocable, unconditional letter of credit in favor of Beneficiary and
entitling Beneficiary to draw thereon in The City of New York issued by a bank
satisfactory to Beneficiary, accompanied by an opinion of counsel to such bank
to the effect that such letter of credit has been duly authorized, executed and
delivered by such bank and constitutes the legal, valid and binding obligation
of such bank enforceable against such bank by Beneficiary in accordance with
its terms subject to customary exceptions at the time for opinions for such
instruments, together with an opinion of counsel to the effect that, taking
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into account the purpose under this Deed of Trust for which such letter of
credit will be given, such letter of credit and accompanying opinion are
responsive to the requirements of this Deed of Trust.
"Collateral Account" shall have the meaning set forth in the
Intercreditor Agreement.
"Environmental Laws" shall mean any and all Governmental
Requirements pertaining to occupational health or the environment in effect in
the State, including without limitation, the Oil Pollution Act of 1990 ("OPA"),
the Clean Air Act, as amended, the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980 ("CERCLA"), as amended, the Federal
Water Pollution Control Act, as amended, the Occupational Safety and Health Act
of 1970, as amended, the Resource Conservation and Recovery Act of 1976
("RCRA"), as amended, the Safe Drinking Water Act, as amended, the Toxic
Substances Control Act, as amended, the Superfund Amendments and
Reauthorization Act of 1986, as amended, the Hazardous Materials Transportation
Act, as amended, and other environmental conservation or protection laws. The
term "oil" shall have the meaning specified in OPA, the terms "hazardous
substance" and "release" (or "threatened release") have the meanings specified
in CERCLA, and the terms "solid waste" and "disposal" (or "disposed") have the
meanings specified in RCRA; provided, however, that (i) in the event either
OPA, CERCLA or RCRA is amended so as to broaden the meaning of any term defined
thereby, such broader meaning shall apply subsequent to the effective date of
such amendment and (ii) to the extent the laws of the State establish a meaning
for "oil", "hazardous substance", "release", solid waste" or "disposal" which
is broader than that specified in either OPA, CERCLA or RCRA, such broader
meaning shall apply with respect to the Mortgaged Property.
"Excepted Liens" shall mean (a) Liens for taxes, assessments
or other governmental charges or levies not yet due or which are being
contested in good faith by appropriate action and for which appropriate
reserves have been maintained; (b) operators', vendors', carriers',
warehousemen's, repairmen's, mechanics', workmen's, materialmen's, construction
or other like Liens arising by operation of law in the ordinary course of
business or statutory landlord's liens; (c) any Liens reserved in leases for
rent and for compliance with the terms of the leases
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in the case of leasehold estates, to the extent that any such Lien referred to
in this clause does not materially impair the use of the Mortgaged Property
covered by such Lien for the purposes for which such Mortgaged Property is held
by Trustor or materially impair the value of such Mortgaged Property subject
thereto; (d) the Liens listed on Schedule 1 attached hereto and made a part
hereof; and (e) Liens and encumbrances (other than to secure the payment of
borrowed money or the deferred purchase price of Mortgaged Property or
services), easements, restrictions, servitudes, permits, conditions, covenants,
exceptions or reservations in any rights of way for the purpose of roads,
pipelines, transmission lines, transportation lines, distribution lines for the
removal of gas, oil, coal or other minerals or timber, and other like purposes,
or for the joint or common use of real estate, rights of way, facilities and
equipment, and defects, irregularities, zoning restrictions and deficiencies in
title to the Mortgaged Property of which in the aggregate do not prevent the
use of the Mortgaged Property for the purposes of which it is currently held by
Trustor or have a Material Adverse Effect on the Companies taken as a whole.
"Governmental Authority" shall include the country, the state,
county, city and political subdivisions in which any Person or such Person's
Property is located or which exercises valid jurisdiction over any such Person
or such Person's Property, and any court, agency, department, commission,
board, bureau or instrumentality of any of them including monetary authorities
which exercises valid jurisdiction over any such Person or such Person's
Property. Unless otherwise specified, all references to Governmental Authority
herein shall mean a Governmental Authority having jurisdiction over, where
applicable, Trustor or any Secured Party.
"Governmental Requirement" shall mean any law, statute, code,
ordinance, order, determination, rule, regulation, judgment, decree,
injunction, franchise, permit, certificate, license, authorization or other
directive or requirement, including, without limitation, Environmental Laws,
energy regulations and occupational safety and health standards or controls, of
any Governmental Authority.
"Hazardous Materials" shall mean any pollutants, contaminants,
or industrial, toxic or hazardous substances or wastes.
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"Lien" shall mean any interest in Mortgaged Property owed to,
or a claim by a Person, whether such interest is based on the common law,
statute or contract, and whether such obligation or claim is fixed or
contingent, and including but not limited to the lien or security interest
arising from a mortgage, encumbrance, pledge, security agreement, conditional
sale or trust receipt or a lease, consignment or bailment for security
purposes. The term "Lien" shall include reservations, exceptions,
encroachments, easements, rights of way, covenants, conditions, restrictions,
leases and other title exceptions and encumbrances affecting the Mortgaged
Property.
"Material Adverse Effect" shall mean, as to any Person, asset
or Property, a material adverse effect on the business, assets, properties,
condition (financial or other), operations or results of operations of such
Person, asset or Property, which effect is not adequately and effectively
insured or indemnified against by a financially sound insurance company, and
excepting effects arising solely out of general national economic conditions
and/or effects arising solely out of matters affecting the industry in which
such Person, asset or Property conducts business a whole.
"Note Rate" shall mean the rate borne by the Notes.
"NRS" shall mean the Nevada Revised Statutes.
"Person" shall mean any individual, corporation, company,
voluntary association, partnership, joint venture, trust, unincorporated
organization or government or any agency, instrumentality or political
subdivision thereof, or any other form of entity.
"Property" shall mean any interest in any kind of property or
asset, whether real, personal or mixed, or tangible or intangible.
"Revolving Credit Agreement" shall mean that certain Loan and
Security Agreement dated as of June 17, 1997 among PAAC, as borrower, Bank of
America Illinois, as agent and a lender, and the lenders named therein, as in
effect on the date hereof.
"State" shall mean the state where the Land is located.
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"Surety Bond" shall mean a clean irrevocable surety bond or
credit insurance policy in favor of Beneficiary issued by an insurance company
the claims paying ability rating of which at the time such surety bond or
credit insurance policy is delivered is satisfactory to Beneficiary,
accompanied by an opinion of counsel to such insurance company to the effect
that such surety bond or credit insurance policy has been duly authorized,
executed and delivered by such insurance company and constitutes the legal,
valid and binding obligation of such insurance company enforceable against such
insurance company by Beneficiary in accordance with its terms subject to
customary exceptions at the time for opinions for such instruments, together
with an opinion of counsel to the effect that, taking into account the purpose
under this Deed of Trust for which such surety bond will be given, such surety
bond and accompanying opinions are responsive to the requirements of this Deed
of Trust.
"Trust Money" shall mean those certain proceeds set forth in
subsections IV(q)(i) and IV(q)(ii).
SECTION IX - MISCELLANEOUS
(a) Choice of Law. The terms and provisions of this Deed of
Trust and the enforcement hereof shall be governed by and construed in
accordance with the laws of the state where the Land is located.
(b) Severability. If any provision hereof is invalid or
unenforceable in any jurisdiction, the other provisions hereof shall remain in
full force and effect in such jurisdiction and the remaining provisions hereof
shall be liberally construed in favor of the Deed of Trust Trustee and
Beneficiary in order to effectuate the provisions hereof, and the invalidity or
unenforceability of any provision hereof in any jurisdiction shall not affect
the validity or enforceability of any such provision in any other jurisdiction.
If any part of the Secured Obligations cannot be lawfully secured by this Deed
of Trust or if any part of the Mortgaged Property cannot be lawfully subject to
the Lien and security interest hereof to the full extent of such Secured
Obligations, then all payments made shall be applied on said Secured
Obligations first in discharge of that portion thereof which is not secured by
this Deed of Trust.
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(c) Construction of this Instrument. This instrument may be
construed as a mortgage, deed of trust, chattel mortgage, conveyance,
assignment, security agreement, fixture filing, pledge, financing statement,
hypothecation or contract, or any one or more of them, in order fully to
effectuate the Lien hereof and the purposes and agreements herein set forth.
(d) Captions; Gender and Number. The captions and section
headings of this Deed of Trust are for convenience only and are not to be used
to define the provisions hereof. The term "Beneficiary" as used herein shall
mean and include any successor(s) to United States Trust Company of New York in
its capacity as Collateral Agent under the Intercreditor Agreement. The terms
used to designate the Deed of Trust Trustee, Beneficiary and Trustor shall be
deemed to include the respective heirs, legal representatives, successors and
assigns of such parties. All terms contained herein shall be construed,
whenever the context of this Deed of Trust so requires, so that the singular
includes the plural and so that the masculine includes the feminine.
(e) Rights of Beneficiary. The Lien, security interest
and other security rights of Beneficiary hereunder shall not be impaired by any
indulgence, moratorium or release granted by Beneficiary, the Note Trustee or
the Term Loan Agent, including, but not limited to, any renewal, extension or
modification with respect to any Secured Obligation, or any surrender,
compromise, release, renewal, extension, exchange or substitution which
Beneficiary may grant in respect of the Mortgaged Property, or any part thereof
or any interest therein, or any release or indulgence granted to any endorser,
guarantor or surety of any Secured Obligation.
(f) Waiver of an Event of Default. Beneficiary may waive
any Event of Default without waiving any other prior or subsequent Event of
Default. Beneficiary may remedy any Event of Default without waiving the Event
of Default remedied. No single or partial exercise by Beneficiary of any right,
power or remedy hereunder shall exhaust the same or shall preclude any other or
further exercise thereof, and every such right, power or remedy hereunder may
be exercised at any time and from time to time. No modification or waiver of
any provision hereof nor consent to any departure by Trustor therefrom shall in
any event be effective unless the same shall be in writing and signed by
Beneficiary and
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then such waiver or consent shall be effective only in the specific instances,
for the purpose for which given and to the extent therein specified. No notice
to nor demand on Trustor in any case shall of itself entitle Trustor to any
other or further notice of demand in similar or other circumstances. Acceptance
by Beneficiary of any payment in an amount less than the amount then due on any
Secured Obligations shall be deemed an acceptance on account only and shall not
in any way excuse the existence of an Event of Default hereunder.
(g) Successor Trustor. In the event the ownership of the
Mortgaged Property or any part thereof becomes vested in a person other than
Trustor, Beneficiary may, without notice to Trustor, deal with such successor
or successors in interest with reference to this Deed of Trust and the Secured
Obligations in the same manner as with Trustor, without in any way vitiating or
discharging Trustor's liability hereunder or for the payment of the Secured
Obligations or performance of the obligations secured hereby. No transfer of
the Mortgaged Property, no forbearance on the part of Beneficiary and/or any
Secured Party, and no extension of the time for the payment of the Secured
Obligations, in whole or in part, shall affect the liability of Trustor or any
other person hereunder or for obligations secured hereby.
(h) Outstanding Lien, Security Interest, Charge or Prior
Encumbrance. To the extent that proceeds of the Notes or proceeds of advances
under the Term Loan Agreement are used to pay indebtedness secured by any
outstanding Lien, security interest, charge or prior encumbrance against the
Mortgaged Property, such proceeds have been advanced at Trustor's request, and
Beneficiary shall be subrogated to any and all rights, security interests and
Liens owned by any owner or holder of such outstanding Liens, security
interests, charges or encumbrances, irrespective of whether said Liens,
security interests, charges or encumbrances are released, and it is expressly
understood that, in consideration of the payment of such indebtedness, Trustor
hereby waives and releases all demands and causes of action for offsets and
payments to, upon and in connection with the said indebtedness.
(i) Covenants Running with the Land. The covenants and
agreements herein contained shall constitute covenants running with the land
and interests covered or affected hereby
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and shall be binding upon the heirs, legal representatives, successors and
assigns of the parties hereto.
(j) Notices. All notices requests, demands and other
communications provided for or permitted hereunder shall be in writing
(including telex and telecopy communications) and shall be sent by mail, telex,
telecopier or hand delivery:
If to Trustor, to the following address:
4200 NationsBank Center
700 Louisiana Street
Suite 4200
Houston, Texas 77002
Attention: Vice President, General Counsel
and Secretary
If to Beneficiary, to the following address:
United States Trust Company of New York
114 West 47th Street
New York, New York 10036
Attention: Corporate Trust Department
If to the Deed of Trust Trustee, to the following address:
First American Title Company of Nevada
3760 Pecos-McLeod, Suite # 7
Las Vegas, Nevada 89121
All such notices, requests, demands and communications shall be deemed to have
been duly given or made, when delivered by hand or five (5) business days after
being deposited in the mail, postage paid, when telexed answer back received
and when telecopied, receipt acknowledged. Any party hereto may change its
address set forth in this subsection (j) by notice to the other parties given
in accordance with the provisions of this subsection (j).
(k) Beneficiary's Consent. Except where otherwise
expressly provided herein, in any instance hereunder where the approval,
consent or the exercise of judgment of Beneficiary is required, the granting or
denial of such approval or consent and the exercise of such judgment shall be
within the sole discretion
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of Beneficiary, and Beneficiary shall not, for any reason or to any extent, be
required to grant such approval or consent or exercise such judgment in any
particular manner, regardless of the reasonableness of either the request or
Beneficiary's judgment.
(l) Foreclosure. In the event there is a foreclosure sale
hereunder, and at the time of such sale Trustor or Trustor's successors or
assigns or any other person claiming any interest in the Mortgaged Property by,
through or under Trustor, are occupying or using the Mortgaged Property or any
part thereof, each and all shall immediately become the tenant of the purchaser
at such sale, which tenancy shall be a tenancy from day to day, terminable at
the will of either the landlord or tenant, or at a reasonable rental per day
based upon the value of the property occupied, such rental to be due daily to
the purchaser; to the extent permitted by applicable law, the purchaser at such
sale shall, notwithstanding any language herein apparently to the contrary,
have the sole option to demand immediate possession following the sale or to
permit the occupants to remain as tenants at will. In the event the tenant
fails to surrender possession of said property upon demand, the purchaser shall
be entitled to institute and maintain a summary action for possession of the
Mortgaged Property (such as an action for forcible entry and detainer) in any
court having jurisdiction. The purchaser or purchasers at foreclosure shall
have the right to affirm or disaffirm any lease of the Mortgaged Property or
any part thereof.
(m) Reimbursement. Trustor shall reimburse the Deed of
Trust Trustee and Beneficiary, upon demand, for all fees, costs and expenses
incurred by the Deed of Trust Trustee and Beneficiary in connection with the
administration and enforcement of this Deed of Trust. If any action or
proceedings, including, without limitation, bankruptcy or insolvency
proceedings, is commenced to which action or proceeding the Deed of Trust
Trustee or Beneficiary is made a party or in which it becomes necessary to
defend or uphold the Lien or validity of this Deed of Trust, Trustor shall,
upon demand, reimburse the Deed of Trust Trustee and Beneficiary for all
expenses (including, without limitation, attorneys' and agents' fees and
disbursement) incurred by the Deed of Trust Trustee or Beneficiary in such
action or proceedings. In any action or proceeding to foreclose this Deed of
Trust or to recover or collect the Secured Obligations, the
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provisions of law relating to the recovery of costs, disbursements and
allowances shall prevail unaffected by this covenant. Trustor's obligations
under this subsection IX(m) shall survive the satisfaction of this Deed of
Trust and the discharge of Trustor's other obligations hereunder.
(n) Waiver of Stay. (i) Trustor agrees that in the event
that Trustor or any property or assets of Trustor shall hereafter become
subject of a voluntary or involuntary proceeding under the Bankruptcy Code or
Trustor shall otherwise be a party to any federal or state bankruptcy,
insolvency, moratorium or similar proceeding to which the provisions relating
to the automatic stay under Section 362 of the Bankruptcy Code or any similar
provision in any such law is applicable, then, in any such case, whether or not
Beneficiary has commenced foreclosure proceedings under this Deed of Trust,
Beneficiary shall be entitled to relief from any such automatic stay as it
relates to the exercise of any of the rights and remedies (including, without
limitation, any foreclosure proceedings) available to Beneficiary as provided
in this Deed of Trust or in any other document evidencing or securing the
Secured Obligations.
(ii) Beneficiary shall have the right to petition or move
any court having jurisdiction over any proceeding described in subsection
IX(n)(i) for the purposes provided therein, and Trustor agrees (a) not to
oppose any such petition or motion and (b) at Trustor's sole cost and expense,
to assist and cooperate with Beneficiary, as may be requested by Beneficiary
from time to time, in obtaining any relief requested by Beneficiary, including,
without limitation, by filing any such petitions, supplemental petitions,
requests for relief, documents, instruments or other items from time to time
requested by Beneficiary or any such court.
(o) Waiver of Jury Trial. To the extent permitted by law,
Trustor hereby knowingly, voluntarily and intentionally waives any rights it
may have to a trial by jury in the respect of any litigation based hereon, or
directly or indirectly arising out of, under or in connection with, this Deed
of Trust or any course of conduct, course of dealing, statements (whether
verbal or written) or actions of Trustor, the Deed of Trust Trustee or
Beneficiary.
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(p) Counterparts. This instrument may be executed in
several counterparts, all of which are identical. Each of such counterparts
shall for all purposes be deemed to be an original and all such counterparts
shall together constitute but one and the same instrument.
(q) Provisions of the Intercreditor Agreement. Notwithstanding
anything to the contrary contained in this Deed of Trust, it is the
understanding of the parties hereto that any actions by the Deed of Trust
Trustee and/or Beneficiary are subject to the provisions of the Intercreditor
Agreement.
[Signature page follows]
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IN WITNESS WHEREOF, this Deed of Trust has been duly executed
by Trustor as of the date first written above.
Trustor:
PIONEER CHLOR ALKALI COMPANY, INC.
By: /s/ PHILIP J. ABLOVE
--------------------------
Name: Philip J. Ablove
Title: Vice President and
Chief Financial Officer
The name and address of Trustor is:
PIONEER CHLOR ALKALI COMPANY, INC.
700 Louisiana Street, Suite 4200
Houston, Texas 77002
The name and address of Beneficiary is:
UNITED STATES TRUST COMPANY OF NEW YORK
114 West 47th Street
New York, New York 10036
Attention: Corporate Trust Department
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THE STATE OF NEW YORK )
)
COUNTY OF NEW YORK )
This instrument was acknowledged before me on this 17th day of June
1997, by Philip J. Ablove, Vice President and Chief Financial Officer of
Pioneer Chlor Alkali Company, Inc., a Delaware corporation, on behalf of such
corporation.
/s/ CHRISTOPHER TUNG
--------------------------------
Notary Public in and for
The State of New York
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