EXHIBIT 10.7
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DEED OF TRUST
(Security Agreement and Financing Statement)
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(Dallas, Dallas County, Texas)
This combined Deed of Trust, Security Agreement and Financing Statement
("Instrument") is made on the date stated below among the Grantor, Beneficiary
and Trustee who are identified and whose addresses are stated below. By signing
this Instrument, Grantor agrees to the terms and conditions and makes the
covenants stated in this Instrument.
DATE: January 10, 2003
GRANTOR: PLASTIC PALLET PRODUCTION, INC.
GRANTOR'S ADDRESS: ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
BENEFICIARY: ▇▇▇▇ ▇. ▇▇▇▇▇▇
BENEFICIARY'S ADDRESS: ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
TRUSTEE: T. ▇▇▇▇▇ ▇▇▇▇
TRUSTEE'S ADDRESS: ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
NOTE: Promissory Note in the maximum principal
amount of Seven Million and No/100 dollars
($7,000,000) executed by Grantor and Palweb
Corporation, an Oklahoma corporation
("Palweb") (Grantor and Palweb collectively,
"Borrowers') and payable to the order of
Beneficiary.
LAND: See attached Exhibit "A" annexed hereto and
incorporated herein by reference for all
purposes.
ARTICLE I - SECURITY
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1.01. Conveyance In Trust. For value received, the receipt and
sufficiency of which Grantor acknowledges, and to secure the payment of the
Indebtedness described in Section 2.01 and performance of the covenants and
agreements of Grantor stated in this Instrument and in the Loan Documents (as
hereinafter defined), Grantor conveys the Property described in Section 1.02,
including, without limitation, the Land, to the Trustee in trust, with power of
sale, TO HAVE AND TO HOLD the Property, together with the rights, privileges,
and appurtenances thereto belonging unto the Trustee and the Trustee's
substitutes or successors forever. Grantor binds itself and its heirs,
executors, administrators, personal representatives, successors, and assigns to
WARRANT AND FOREVER DEFEND the Property unto the Trustee, and the Trustee's
substitutes or successors and assigns, against the claim or claims of all
persons claiming or to claim the same or any part thereof subject to the
Permitted Encumbrances (hereinafter defined).
1.02. Property. The Property covered by this Instrument includes the
Land and the following items described in this Section 1.02, whether now owned
or hereafter acquired, all of which, including replacements and additions
thereto, shall be deemed to be and remain a part of the Property covered by this
Instrument, and all rights, hereditaments and appurtenances pertaining thereto,
all of which are referred to as the "Property":
A. All buildings, structures and improvements now or hereafter
erected or placed in or upon the Land, and all fixtures now or hereafter located
in or upon any such building, structure or other improvement, regardless of the
method of annexation or removability, including, without limitation, all
electrical equipment (including lighting equipment, refrigeration equipment,
ceiling fans, attic and window fans, motors and all other electrical
paraphernalia), all furnaces, heaters, radiators and all other heating
equipment, all linoleum and other permanent floor coverings, and all elevators
(collectively, the "Improvements");
B. All apparatus, chattels, equipment, machinery, trade
fixtures, furnishings, appliances and supplies now or hereafter located upon the
Land or the Improvements, or attached to or used in connection with the Land or
the Improvements, whether or not the same have or would become a part of the
Land by attachment thereto, and all other personal property and fixtures of
whatever kind and nature presently contained or hereafter placed in or located
upon the Land or the Improvements, including all accessions and accessories to
the personal property covered hereby, all replacements thereof and all parts
substituted therein or thereon, whether or not same has or would become part of
the Land or the Improvements (the foregoing personal property being sometimes
hereinafter referred to separately as the "Personal Property");
C. All rents, issues and profits arising and to arise during
the term of this Instrument for or on account of or with respect to the Land,
the Improvements or the Personal Property;
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D. All judgments and awards (and all proceeds thereof and
other rights with respect thereto) made or to be made with respect to all or any
part of the Land, the Improvements or the Personal Property under or in
connection with any power of eminent domain;
E. All rights to collect and receive any sums payable as or
for damages to any of the Land, the Improvements or the Personal Property, for
any reason or by virtue of any occurrence; and
F. All rights to collect and receive any unearned or unaccrued
premiums for casualty insurance policies covering the Improvements or the
Personal Property, due or returnable upon any cancellation of or change in such
policies.
1.03. Subrogation. If the money loaned or advanced by Beneficiary and
secured hereby shall be used to pay off or discharge any lien or encumbrance
upon or against the Property, Beneficiary, at its option, will be subrogated to
all such liens or encumbrances so discharged, satisfied or paid, even though
same may be released of record, and to all the rights of the person or persons
to whom such payments have been made, and may immediately enforce the same
against Grantor and the Property.
ARTICLE II - INDEBTEDNESS AND PAYMENTS
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2.01. Indebtedness. The indebtedness secured by this Instrument (the
"Indebtedness") shall mean and include the following:
A. Any and all sums becoming due and payable pursuant to the
Note;
B. Any and all Indebtedness (as defined in the Loan Agreement)
of Borrowers to Beneficiary arising under or in connection with that certain
Loan Agreement of even date herewith between and among Borrowers and Beneficiary
(together with any extensions, renewals, modifications, restatements,
supplements, or replacements thereof or therefor collectively, the "Loan
Agreement").
C. Any and all other sums becoming due and payable by Grantor
to Beneficiary as a result of advances made by Beneficiary pursuant to the terms
and conditions of this Instrument or any other Loan Documents securing or
executed in connection with or otherwise relating to the Note; and
D. Any and all renewals, extensions, replacements,
rearrangements, substitutions or modifications of the Indebtedness, or any part
of the Indebtedness, including without limitation, the Note.
2.02. Other Loan Documents. In addition to this Instrument and the
Note, Grantor and Beneficiary may execute various other documents and agreements
relating to the Indebtedness secured by this Instrument, including the Loan
Agreement and the other Loan Documents described and defined therein, all of
which documents and agreements, including the Loan Agreement, are collectively
referred to herein as the "Loan Documents." This Instrument shall
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also secure the performance of all obligations and covenants of Grantor under
this Instrument, the Loan Agreement, and other Loan Documents. Defined terms
used herein but not expressly defined shall have the meanings ascribed thereto
in the Loan Agreement.
2.03 Payment of Principal and Interest. Borrowers shall promptly pay
when due the principal and interest on the Indebtedness evidenced by the Note,
any prepayment and late charges or default rate of interest provided in the
Note, and all other sums secured by this Instrument.
2.04 Application of Payments. Unless applicable law provides otherwise,
all payments received by Beneficiary from Borrowers under the Note or this
Instrument shall be applied by Beneficiary in the following order of priority:
(a) amounts payable to Beneficiary by Grantor under this Instrument; (b) sums
payable to Beneficiary under the Note to be applied to principal or interest as
Beneficiary may determine in its discretion; and (c) any other sums secured by
this Instrument in such order as Beneficiary, at Beneficiary's option, may
determine.
ARTICLE III - SECURITY AGREEMENT
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3.01. Uniform Commercial Code Security Agreement. This Instrument shall
constitute a Security Agreement under the Uniform Commercial Code with respect
to all of the Property. Grantor will, from time to time and as often as
requested by Beneficiary, execute and deliver to Beneficiary such financing
statements and such other and supplemental security agreements as Beneficiary
may reasonably request to perfect the security interest created, or intended to
be created, hereby and to more specifically identify the collateral subject to
such security interest. No failure or omission of Beneficiary to request any
financing statement or additional or supplemental security agreement, and no
failure or omission of Grantor to execute or deliver any thereof, will impair
the effectiveness or priority of the security interest created by this
Instrument. Grantor will pay all costs of filing this Instrument (to the extent
permitted by law) and any financing statements, continuation or termination
statements with respect thereto and any affidavits or other instruments
executed, or to be executed, to perfect, renew, continue or maintain the lien
and security interest created hereby. Grantor hereby appoints Beneficiary as the
agent and attorney-in-fact of Grantor to do, at Beneficiary's option and
Grantor's expense, all acts and things reasonably necessary to perfect, and
maintain perfection of, the lien and security interest created, or intended to
be created, hereby.
3.02. Notice of Changes. Grantor shall give advance notice in writing
to Beneficiary of any proposed change in Grantor's name, identity or structure
and shall execute and deliver to Beneficiary, prior to or concurrently with the
occurrence of any such change, all additional financing statements which
Beneficiary may require to establish and maintain the validity and priority of
Beneficiary's security interest with respect to any of the Property described or
referred to herein.
3.03. Fixture Financing Statement. Some of the items of the Property
described herein are goods which are or are to become fixtures related to the
Property, and it is intended that, as to
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those goods, this Instrument shall be effective as a financing statement filed
as a fixture filing from the date of its filing for record in the real estate
records of the county in which the Property is situated. Information concerning
the security interest created by this instrument may be obtained from
Beneficiary, as secured party, at the address of Beneficiary stated above. The
mailing address of Grantor, as debtor, is as stated above.
ARTICLE VI - GRANTOR'S REPRESENTATIONS,
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WARRANTIES, COVENANTS AND AGREEMENTS
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Grantor covenants, warrants and represents to and agrees with
Beneficiary as follows:
4.01. Payment and Performance. Grantor shall make all payments on the
Indebtedness when due and shall punctually and properly perform all of Grantor's
covenants, obligations and liabilities under this Instrument and the other Loan
Documents.
4.02. Warranty of Title. Grantor represents and warrants that it is the
lawful owner and is in possession of the Property and is well and lawfully
seized of a good and indefeasible estate in fee simple, free and clear of all
encumbrances of every nature and kind whatsoever, except for the Permitted Liens
(as defined in the Loan Agreement) and those encumbrances listed on Exhibit B
attached hereto and made a part hereof (collectively, the "Permitted
Encumbrances"). Grantor represents and warrants that it has good right and title
and authority to sell, convey, mortgage, encumber and create a security interest
in and to the same in favor of Trustee. Grantor agrees to make any further
assurances of title that Beneficiary may require and will WARRANT AND DEFEND the
same unto Beneficiary, its successors and assigns, forever, against the lawful
claims and demands of all persons whomsoever, subject to the Permitted
Encumbrances.
4.03. Title Insurance. Grantor shall, at its sole cost and expense,
obtain and maintain mortgagee title insurance (in the form of a commitment,
binder, or policy as Beneficiary may require) in form acceptable to Beneficiary
in an amount equal to the appraised fair market value of the Property.
4.04. Insurance.
A. Grantor agrees to maintain continuously, at all times
during the term of this Instrument, casualty, public liability and other
insurance coverage on the Property to the extent and in the amounts required
under the Loan Agreement.
B. If title to the Property is transferred, Beneficiary shall
have the right, but not the duty, as authorized agent for Grantor, to assign the
insurance to the grantee of title. In the event of loss under any such policies,
Grantor will give immediate notice to Beneficiary. If Beneficiary by reason of
such insurance receives any money for loss or damage, such amount shall, subject
to the following proviso, be held by Beneficiary and paid to Grantor for the
repair or restoration of the Property, provided that Grantor shall not be in
default hereunder, and if Grantor shall have delivered to Beneficiary within
sixty (60) days after such casualty: (a) plans
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and specifications, in form and substance reasonably satisfactory to
Beneficiary, for any such rebuilding or restoration; (b) a budget for rebuilding
or restoration reasonably satisfactory to Beneficiary; and (c) evidence
reasonably satisfactory to Beneficiary that Grantor has or will have upon
receipt of insurance proceeds, all amounts necessary to pay the cost of such
rebuilding or restoration. Otherwise, Beneficiary may retain and apply the
insurance proceeds toward payment of the Indebtedness secured by this
Instrument. In the event of a foreclosure of this Instrument, the purchaser of
the Property shall succeed to all the rights of Grantor, including any right to
unearned premiums, in and to all certificates and policies of insurance assigned
and delivered to Beneficiary pursuant to the provisions of this paragraph.
4.05. Taxes. Grantor will pay, before same become delinquent or any
penalty attaches thereto for nonpayment, all taxes, assessments and charges,
general or special, of every nature and kind, that may be now or hereafter
levied or assessed under any law now existing or hereafter enacted, upon the
Property or any part thereof, upon the rents, issues, income or profits thereof,
or upon the Indebtedness, whether any or all of said taxes, assessments or
charges be levied directly or indirectly or as excise taxes or as income taxes,
except to the extent required otherwise by the state law governing the Land.
Grantor will not suffer or permit any liens, security interests, levy,
attachment or other encumbrance to become effective, or to be asserted, against
any of the, other than the Permitted Encumbrances, and will regularly and
promptly submit to Beneficiary evidence of the due and punctual payment of such
taxes, assessments or charges as Beneficiary may require from time to time. The
foregoing notwithstanding, Grantor may in good faith contest, by a proper legal
proceeding, the validity or amount of any such taxes, assessments or charges
subject to the terms and conditions set forth in the Loan Agreement. Upon (i)
violation of the foregoing in any part, (ii) the passage by the State of Texas
of any law (a) imposing payment of the whole or any part of the aforesaid taxes
or assessments upon Beneficiary, (b) deducting from the value of the Property
for the purpose of taxation any liens thereon or, (c) changing in any way the
laws now in force 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 so as to adversely affect this Instrument, or (iii) the rendering by any
court of competent jurisdiction of a decision holding that any undertaking by
Grantor to pay such taxes or assessments, or any of them, or any similar
undertaking, is in whole or in part legally inoperative or void, and if any of
(i), (ii) or (iii) above would have a material adverse effect (as defined in the
Loan Agreement), then in such event the Indebtedness will, at the option of
Beneficiary, become immediately due and payable, notwithstanding anything
contained in this Instrument.
4.06. Condemnation. All awards heretofore or hereafter made by any
public or quasi-public authority to the present or any future owner of the
Property by virtue of an exercise of the right of eminent domain by such
authority, including any award for a taking of title, possession or right of
access to a public way, or for any change of grade of streets affecting said
Property, are hereby assigned to Beneficiary. Beneficiary, at its option, is
hereby authorized and empowered to collect and receive the proceeds of any such
award or awards from the authorities making the same and to give proper receipts
and acquittances therefor, and may, at Beneficiary's option, (i) apply such
proceeds or any part thereof upon the Indebtedness, including unmatured portions
thereof, (ii) use such proceeds or any part thereof to fulfill and satisfy any
covenants
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enjoined upon Grantor herein, (iii) use such proceeds or any part thereof to
replace or restore the Property to a condition satisfactory to Beneficiary, or
(iv) release such proceeds to Grantor. Upon request, Grantor agrees to make,
execute and deliver any and all assignments and other instruments required for
the purpose of assigning all such awards to the Beneficiary.
4.07. Additional Covenants. At all times during the term of this
Instrument, Grantor will:
A. Keep the Property in good order, condition and repair,
ordinary wear and tear excepted;
B. Not commit, permit or suffer any waste, impairment or
deterioration of the Property or any part thereof, ordinary wear and tear
excepted;
C. Comply with all laws, ordinances, regulations, covenants,
conditions and restrictions affecting the Property or the use thereof, and not
suffer or permit any violation thereof;
D. Not demolish or alter the design or structural character of
the Property or any improvements now or hereafter erected upon the Property,
unless Beneficiary shall first consent thereto in writing;
E. Not remove without Beneficiary's written consent any of the
Property, except for purposes of replacement or repair or in the ordinary course
of Grantor's business;
F. Except for the Permitted Encumbrances, keep the Property
free from all judgments, mechanics' liens and all other statutory liens of
whatsoever nature to the end that the priority of this Instrument may, at all
times, be maintained;
G. Allow Beneficiary to examine and inspect the Property at
any reasonable time or times, subject to the limitations set forth in the Loan
Agreement; and
H. Pay Beneficiary within ten (10) days of demand together
with interest accruing at the rate under the Note, all sums, including costs,
expenses and reasonable agents' and attorneys' fees, it may expend or for which
it may become obligated in any proceedings, legal or otherwise, to establish and
sustain the lien of this Instrument or its priority or in defending against any
liens, claims, rights, estates, easements or restrictions of any person or
persons asserting priority thereto.
4.08. Protection of Beneficiary's Security.
A. If Grantor fails to perform the covenants and agreements
contained in this Instrument, or if any action or proceeding is commenced which
affects the Property or title thereto or the interest of Beneficiary therein,
including, without limitation, eminent domain,
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insolvency, code enforcement, or arrangements or proceedings involving a
bankrupt or decedent, then Beneficiary, at Beneficiary's option, may make such
appearances, disburse such sums and take such action as Beneficiary deems
necessary, in its sole discretion, to protect Beneficiary's interest, including,
without limitation, (i) disbursement of attorneys' fees, (ii) entry upon the
Property to make repairs, and (iii) procurement of satisfactory insurances as
provided in Section 4.04.
B. Any amounts disbursed by Beneficiary pursuant to this
Section, with interest thereon, shall become additional indebtedness of Grantor
secured by this Instrument. Unless Grantor and Beneficiary agree to other terms
of payment, such amounts shall be immediately due and payable and shall bear
interest from the date of disbursement at the rate stated in the Note unless
collection from Grantor of interest at such rate would be contrary to applicable
law, in which event such amounts shall bear interest at the highest non-usurious
rate which may be collected from Grantor under applicable law. Grantor covenants
and agrees that Beneficiary shall be subrogated, if and to the extent permitted
by applicable law, to the lien of any mortgage or other lien discharged, in
whole or in part, by the Indebtedness. Nothing contained in this Section shall
require Beneficiary to incur any expense or take any action under this
Instrument.
4.09. Liens. Except for the Permitted Encumbrances, Grantor shall
promptly discharge any lien which has, or may have, priority over or equality
with, the lien of this Instrument, and Grantor shall pay, when due, the claims
of all persons supplying labor or materials to or in connection with the
Property. Without Beneficiary's prior written permission, Grantor shall not
allow any lien inferior to this Instrument to be perfected against the Property,
except for the Permitted Encumbrances.
4.10. Business Use. Grantor warrants and represents to Beneficiary that
the proceeds of the Note will be used solely for business or commercial
purposes, and in no way will the proceeds be used for personal, family or
household purposes.
4.11. Non-Homestead. Grantor warrants and represents to Beneficiary
that the Property is not the business or residential homestead of Grantor or any
other person. Grantor has no present intent to occupy on the future or use or
claim in the future of the Property either as business or residential homestead.
ARTICLE V - EVENTS OF DEFAULT
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During the term of this Instrument, the occurrence of any one of the
following events which shall continue beyond the expiration of any applicable
notice and cure periods set forth in the Loan Agreement, if any, shall
constitute an Event of Default:
5.01. Failure to Pay Indebtedness. Any of the Indebtedness is not paid
when due, whether by acceleration or otherwise.
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5.02. Nonperformance of Covenants. Any covenant in this Instrument or
any of the other Loan Documents is not fully and timely performed, or the
occurrence of any default or event of default under this Instrument or any other
Loan Document.
5.03. False Representation. Any statement, representation or warranty
in this Instrument or any of the other Loan Documents, any financial statement,
or any other writing delivered to Beneficiary in connection with the
Indebtedness is false, misleading, or erroneous in any material respect.
5.04. Transfer of the Property. Title to all or any part of the
Property (other than obsolete or worn Personal Property replaced by adequate
substitutes of equal or greater value than the replaced items when new) shall
become vested in any party other than Grantor, whether by operation of law or
otherwise, except as may be permitted under the Loan Agreement. Beneficiary may,
in its sole discretion, waive this Event of Default, but it shall have no
obligation to do so, and any waiver may be conditioned upon such one or more of
the following which Beneficiary may require; (a) the grantee's integrity,
reputation, character, creditworthiness, and management ability being
satisfactory to Beneficiary in its sole judgment; and (b) grantee executing,
prior to such sale or transfer, a written assumption agreement containing such
terms as Beneficiary may require, such as a principal paydown on the Note, and
increase in the rate of interest payable under the Note, a transfer fee, and any
other modification of the Note, this Instrument or any of the other Loan
Documents which Beneficiary may require.
5.05. Abandonment. Grantor abandons or vacates any of the Property,
except as may be permitted under the Loan Agreement.
5.06. Foreclosure of Other Liens. The holder of any lien, security
interest or assignment on the Property institutes foreclosure or other
proceedings for the enforcement of its remedies thereunder and such proceedings
are not dismissed or discharged within thirty (30) days.
5.07. Liquidation, Death, Etc. The liquidation, termination,
dissolution, failure to maintain good standing in the State of Texas (if
applicable), death, or legal incapacity of Grantor.
5.08. Material, Adverse Change. The occurrence of any material, adverse
change in the financial condition of Grantor.
ARTICLE VI - DEFAULT AND REMEDIES
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6.01. Acceleration and Waiver of Notices. Upon the occurrence of an
Event of Default, Beneficiary, at Beneficiary's option, may declare all of the
sums secured by this Instrument to be immediately due and payable without
further demand and may invoke the power of sale and any other remedies permitted
by applicable law or provided herein. Grantor acknowledges that the power of
sale granted to Beneficiary may be exercised by Beneficiary without prior
judicial hearing. Grantor and each surety, guarantor, and endorser of all or any
part of the Indebtedness
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expressly waive all presentations for payment, notices of intention to
accelerate maturity, notices of intention to demand payment, demands for
payment, protests, and notices of protest. Notwithstanding the foregoing,
Grantor does not waive any right they may have to receive notices of default
under this Instrument, the Note, and the other Loan Documents, as well as any
opportunity to cure any such default.
6.02. Notice of Sale. Notice of sale of all or part of the Property by
the Trustee shall be given by posting written notice thereof at the courthouse
door (or other area in the courthouse as may be designated for such public
notices) of the county in which the sale is to be made, and by filing a copy of
the notice in the office of the county clerk of the county in which the sale is
to be made, at least twenty-one (21) days preceding the date of the sale, and if
the Property is to be sold is in more than one county, a notice shall be posted
at the courthouse door (or other area in the courthouse as may be designated for
such public notices) and filed with the county clerk of each county in which the
Property to be sold is situated. If the Property to be sold is in more than one
county, the notice shall designate the county in which the Property is to be
sold. In addition, Beneficiary shall, at least twenty-one (21) days preceding
the date of sale, serve written notice of the proposed sale by certified mail on
Grantor and each debtor obligated to pay the Indebtedness secured hereby
according to the Beneficiary's records. Service of such notice shall be
completed upon deposit of the notice, enclosed in a postpaid wrapper, properly
addressed to such debtor at the most recent address as shown by the records of
Beneficiary, in a post office or official depository under the care and custody
of the United States Postal Service. The affidavit of any person having
knowledge of the facts to the effect that such service was completed shall be
prima facie evidence of the fact of service. Any notice that is required or
permitted to be given to Grantor may be addressed to Grantor at Grantor's
Address stated above. Any notice that is to be given by certified mail to any
other debtor may, if no address for such other debtor is shown by the records of
certified mail to any other debtor may, if no address for such other debtor is
shown by the records of Beneficiary, be addressed to such other debtor at the
address of Grantor as is shown by the records of Beneficiary. Notwithstanding
the foregoing provisions of this Section, notice of such sale given in
accordance with the requirements of the applicable laws of the State of Texas in
effect at the time of such sale and in accordance with the Loan Agreement shall
constitute sufficient notice of such sale. The Trustee or his 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 Trustee, including the
posting of notices and the conduct of sale, but in the name and on behalf of
Trustee, his successor or substitute. If Trustee or his successor or substitute
shall have given notice of sale hereunder any successor or substitute 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
Trustee conducting the sale.
6.03. Trustee's Sale. Beneficiary may require the Trustee to sell all
or part of the Property, at public auction, to the highest bidder, for cash, at
the county courthouse in the county in Texas in which the Property or any part
thereof is situated, or if the Property is located in more than one county such
sale or sales may be made at the courthouse in any county in which the Property
is situated. All sales shall take place at such area of the courthouse as shall
be properly
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designated from time to time by the commissioners court (or, if not so
designated by the commissioners court, as such other area in the courthouse may
be provided in the notice of sale hereinafter described) of the specified
county, between the hours of 10:00 o'clock a.m. and 4:00 o'clock p.m. (the
commencement of such sale to occur within three hours following the time
designated in the above-described notice of sale as the earliest time at which
such sale shall occur, if required by applicable law) on the first Tuesday of
any month, after giving notice of the time, place and terms of said sale
(including the earliest time at which such sale shall occur) and of the Property
to be sold in the manner hereinafter described, to the extent permitted by
applicable law, any sale may be adjourned by announcement at the time and place
appointed for such sale without further notice except as may be required by law.
Trustee may sell all or any portion of the Property, together or in lots or
parcels. In no event shall Trustee be required to exhibit, present or display at
any such sale any of the Personal Property to be sold at such sale. Beneficiary
may bid and become the purchaser of all or any party of the Property at any
trustee's or foreclosure sale hereunder, and the amount of Beneficiary's
successful bid may be credited on the Indebtedness. In the event any sale
hereunder is not completed or is defective in the opinion of Beneficiary, such
sale shall not exhaust the power of sale hereunder and Beneficiary shall have
the right to cause a subsequent sale or sales to be made hereunder.
6.04. Partial Sales. The sale by Trustee of less than the whole of the
Property shall not exhaust the power of sale herein granted, and Trustee is
specifically empowered to make successive sales under such power until the whole
of the Property shall be sold; and if the proceeds of such sale of less than the
whole of the Property shall be less than the aggregate of the Indebtedness and
the expenses thereof, this Instrument and the lien, security interest and
assignment hereof shall remain in full force and effect as to the unsold portion
of the Property just as though no sale had been made; provided, however, that
Grantor shall never have any right to require the sale of less than the whole of
the Property, but Beneficiary shall have the right, at its sole election, to
request Trustee to sell less than the whole of the Property. If there is a
default on the payment of any installment on the Note or any portion of the
Indebtedness, and Beneficiary elects not to accelerate the unpaid balance of the
Note or Indebtedness, Beneficiary shall have the option to proceed with
foreclosure in satisfaction of such unpaid installment or other amount either
through judicial proceedings or by directing Trustee to proceed as if under a
full foreclosure, conducting the sale as herein provided without declaring the
entire Indebtedness due. It is agreed that such sale, if so made, shall not in
any manner affect the unmatured part of the Indebtedness, but as to such
unmatured part of this Instrument shall remain in full force and effect as
though no sale had been made under the provisions of this Section. Several sales
may be made hereunder without exhausting the right of sale for any unmatured
part of the Indebtedness.
6.05. Foreclosure of All Property. The Land, Improvements, and Personal
Property may be sold in one or more public sales pursuant to Texas Property Code
ss.51.002 and Texas UCC ss.9.501(d). Grantor shall assemble the Personal
Property and make it available to Beneficiary upon Beneficiary's written
request. Grantor and all persons obligated to pay the Indebtedness agree that
notice of sale of the Property provided pursuant to Section 6.02 above and
pursuant to Texas Property Code ss.51.002 is and shall constitute commercially
reasonable
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notice of the sale of the Property or any part of the Property. Beneficiary
shall also be entitled to foreclose its security interests against the Personal
Property in accordance with any other rights and remedies Beneficiary may have
as a secured party under the Texas UCC.
6.06 Trustee's Deed. Trustee shall deliver to the purchaser a Trustee's
deed and such other assignments and documents of transfer and sale as Trustee
may deem necessary conveying the Property so sold in fee simple with covenants
of general warranty. Grantor covenants and agrees to defend generally the
purchaser's title to the Property against any claims and demands.
Notwithstanding the foregoing, Trustee shall deliver this Deed of Trust subject
to the Permitted Encumbrances. At any such sale (a) Grantor hereby agrees, in
its behalf and in behalf of Grantor's heirs, executors, administrators,
successors, personal representatives and assigns, that any and all recitals made
in any deed of conveyance given by Trustee with respect to the identify of
Beneficiary, the occurrence or existence of any default, the acceleration of the
maturity of any of the Indebtedness, the request to sell, the notice of sale,
the given notice to all debtors legally entitled thereto, the time, place, terms
and manner of sale, and receipt, distribution and application of the money
realized therefrom, or the due and proper appointment of a substitute Trustee,
and, without being limited by the foregoing, with respect to any other act or
thing having been duly done by Beneficiary or by Trustee hereunder, shall be
taken by all courts of law and equity as prima facie evidence that the
statements or recitals state facts and are without further question to be so
accepted, and Grantor hereby ratifies and confirms every act that Trustee or any
substitute Trustee hereunder may lawfully do in the premises by virtue hereof,
and (b) the purchaser may disaffirm any easement granted, subdivision plat
filed, or rental, lease or other contract made in violation of any provision of
this Instrument, and may take immediate possession of the Property free from,
and despite the terms of, such grant of easement, subdivision plat, or rental,
lease or other contract.
6.07. Proceeds of Sale. Trustee shall apply the proceeds of the sale in
the following order: (a) to all reasonable costs and expenses of the sale,
including but not limited to, reasonable Trustee's fees and attorneys' fees and
costs of title evidence; (b) to all sums secured by this Instrument in such
order as Beneficiary, in Beneficiary's sole discretion, directs; and (c) the
excess, if any, to the person or persons legally entitled thereto.
6.08. Possession After Sale. If the Property is sold pursuant to
Section 6.03, Grantor or any person holding possession of the Property through
Grantor shall immediately surrender possession of the Property to the purchaser
at such sale upon the purchaser's written demand. If possession is not
surrendered upon the purchaser's written demand, Grantor or such person shall be
a tenant at sufferance and may be removed by writ of possession or by an action
for forcible entry and detainer.
6.09. Costs and Expenses. Beneficiary shall be entitled to collect all
costs and expenses incurred in pursuing such remedies, including but not limited
to, attorneys' fees and costs of documentary evidence, abstracts, and title
reports.
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6.10. Substitute Trustee. Beneficiary, at Beneficiary's option, with or
without cause, may from time to time remove Trustee and appoint successor
trustee to any Trustee appointed hereunder by an instrument recorded in the
county in which this Instrument is recorded. Without conveyance of the Property,
the successor trustee shall succeed to all title, power, and duties conferred
upon the Trustee by this Instrument and by applicable law.
6.11. Remedies Cumulative. Each remedy provided in this Instrument is
distinct and cumulative to all other rights or remedies under this Instrument or
afforded by law or equity, and may be exercised concurrently, independently, or
successively, in any order whatsoever.
6.12. Forbearance by Beneficiary Not a Waiver. Any forbearance by
Beneficiary in exercising any rights or remedy hereunder, or otherwise afforded
by applicable law, shall not be a waiver of or preclude the exercise of any
right or remedy. The acceptance by Beneficiary of payment of any sum secured by
this Instrument after the due date of such payment shall not be a waiver of
Beneficiary's right to either require prompt payment when due of all other sums
so secured or to declare a default for failure to make prompt payment. The
procurement of insurance or the payment of taxes or other liens or charges by
Beneficiary shall not be a waiver of Beneficiary's right to accelerate the
maturity of the Indebtedness, nor shall Beneficiary's receipts of any awards,
proceeds or damages under this Instrument operate to cure or waive Grantor's
default in payment of sums secured by this Instrument.
ARTICLE VII - MISCELLANEOUS PROVISIONS
--------------------------------------
7.01. Release. Upon payment of all sums and the performance of all
obligations secured by this Instrument, Beneficiary shall release this
Instrument. Grantor shall pay Beneficiary's reasonable costs incurred in
releasing this Instrument.
7.02. Grantor and Lien Not Released. From time to time, Beneficiary
may, at Beneficiary's option, without giving notice or obtaining the consent of
Grantor, Grantor's successors or assigns or any junior lienholder, without
liability on Beneficiary's part and notwithstanding the existence of an Event of
Default, extend the time for payment of the Indebtedness or any part thereof,
reduce the payments thereon, release anyone liable on any of the Indebtedness,
accept a renewal note or note therefor, modify the terms and time of payment of
the Indebtedness, release from the liens of this Instrument any part of the
Property, take or release other or additional security, reconvey any part of the
Property, consent to any map or plan of the Property, consent to the granting of
any easement, join in any extension or subordination agreement, and agree in
writing with Grantor to modify the rate of interest or period of amortization of
the Note or change the amount of the installments payable thereunder. Any
actions taken by Beneficiary pursuant to the terms of this section 7.02 shall
not affect the obligation of the Grantor or Grantor's successors or assigns to
pay the sums secured by this Instrument and to observe the covenants of Grantor
contained herein, shall not affect the guaranty of any person, corporation,
partnership, or other entity for payment of the Indebtedness or any part
thereof, and shall affect the liens or priority of liens of this Instrument on
the Property. Grantor shall pay Beneficiary a reasonable charge, together with
such title insurance
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premiums and attorneys' fees as may be incurred at Beneficiary's option, for any
such action if taken at Grantor's request.
7.03. Notices. All notices given pursuant to this Instrument will be in
writing and will be delivered in accordance with the Loan Agreement.
7.04. Binding Effect. This Instrument will be binding upon and inure to
the benefit of the parties hereto and their respective heirs, executors,
administrators, trustees, successors and assigns.
7.05. GOVERNING LAW. EXCEPT TO THE EXTENT THAT THE LAWS OF THE STATE OF
TEXAS ARE MANDATORILY APPLICABLE WITH RESPECT TO VALIDITY, PRIORITY AND
PERFECTION, THIS INSTRUMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF
OKLAHOMA AND BY THE LAWS OF THE UNITED STATES OF AMERICA APPLICABLE TO
TRANSACTIONS IN THE STATE OF TEXAS.
7.06. Severability. In the event that any provision of this Instrument
or the Note conflicts with applicable law, such conflict shall not affect other
provisions of this Instrument or the Note which can be given effect without the
conflicting provisions, and to this end the provisions of this Instrument and
the Note are declared to be severable.
7.07 Partial Invalidity. In the event any portion of the sums intended
to be secured by this Instrument cannot be lawfully secured hereby, payments in
reduction of such sums shall be applied first to those portions not secured
hereby.
7.08. Captions. The captions and headings of the Articles and Section
of this Instrument are for convenience only and are not to be used to interpret
or define the terms and provisions of this Instrument.
7.09. Conflicts with Loan Agreement. Notwithstanding anything to the
contrary contained in this Instrument, in the event of any conflict or
inconsistency between the terms and conditions contained in this Instrument and
the terms and conditions contained in the Loan Agreement, the terms and
conditions contained in the Loan Agreement shall control the resolution of any
such conflict or inconsistency.
[Remainder of page intentionally left blank]
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IN WITNESS WHEREOF, Grantor has caused this Instrument to be executed
in Tulsa, Oklahoma on the day and year first above written.
PLASTIC PALLET PRODUCTION, INC.,
a Texas corporation
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------
Title: President
------------------------------
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ACKNOWLEDGMENT
STATE OF OKLAHOMA )
)
COUNTY OF TULSA )
This instrument was acknowledged before me on January 10, 2003, by
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ as President of PLASTIC PALLET PRODUCTION, INC., a
Texas corporation.
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-----------------------------
Notary Public
▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-----------------------------
Typed or Printed Name
My commission expires: May 19, 2004
----------------
Commission # 00008636
----------------
[SEAL]
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EXHIBIT A
---------
(Legal Description)
BEING a tract of land in the City of Dallas, Texas, in the Wm. ▇▇▇▇▇▇ Survey
Abstract No. 290, and being part of Block 26 through 31 in City Block 7263,
according to the plat of West Dallas recorded in Volume 106, Page 170, of the
Deed Records of Dallas County, Texas, and being a part of a tract of land
conveyed to ▇▇▇▇▇ Metal and Boiler Works by Texas Northern Railroad Company,
dated November 7, 1919, and recorded in Volume 799, Page 571, of the Deed
Records of Dallas County, Texas, and part of two tracts of land conveyed to
▇▇▇▇▇ Metal and Boiler Works by Gulf Colorado, and Santa Fe Railroad Company,
dated August 28, 1948, and recorded in Volume 3089, Page 321 and 327, of the
Deed Records of Dallas County, Texas, and being more particularly described as
follows:
BEGINNING at a 3/8 inch iron rod set for corner at the Northeast Intersection of
the North line of West Commerce Street, with the East line of Vilbig Road, said
point being the Southwest corner of City Block 3l/7263;
THENCE North 0 degrees 06 minutes 19 seconds West, with the East line of said
Vilbig Road, a distance of 313.88 feet to a 3/8 inch iron rod set for corner;
THENCE in a Easterly direction with the North line of a tract of land conveyed
to ▇▇▇▇▇ Metal and Boiler Works in deed filed in Volume 3089, Page 326, and
Volume 3089, Page 321, of the Deed Records of Dallas County, Texas, and the
following course and distances;
Southeasterly direction with a curve to the right having a radius of
1091.34 feet, an angle of 02 degrees 56 minutes 25 seconds, a distance
of 56.0 feet to a 3/8 inch iron rod set for corner;
South 80 degrees 55 minutes 26 seconds East, a distance of 750.50 feet
to a 3/8 inch iron rod set for corner in a curve to the left having a
radius of 3028.19 feet, an angle of 02 degrees 05 minutes 10 seconds, a
distance of 110.25 feet, to a l/2 inch iron rod found for corner;
THENCE South 0 degrees 03 minutes 32 seconds East, 174.17 feet to a l/2 inch
iron rod found for corner in the North line of West Commerce Street;
THENCE North 89 degrees 52 minutes 26 seconds West, 905.30 feet to the POINT OF
BEGINNING and containing 220,922.916 square feet or 5.072 acres of land.
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EXHIBIT B
---------
(Permitted Encumbrances)
1. Real Property taxes for 2003, which are not yet due and payable.
2. Easement and Right of Way dated September 17, 2001, and recorded on September
18, 2001, in Volume 2001182, at Page 4114 of the records of Dallas County,
Texas.
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