COLLATERAL ASSIGNMENT OF ESCROW AGREEMENT AND ESCROW FUNDS
COLLATERAL
ASSIGNMENT
OF
ESCROW
AGREEMENT AND ESCROW FUNDS
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DATE:
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October
9, 2008
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|
DEBTOR:
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America
West Resources,
Inc., a Nevada corporation
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LENDERS:
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Denly
ACI Partners,
Ltd., a Texas limited partnership (the "Partnership"),
and Xxxxxx X. xxx
Xxxxxx,
Co-Trustee ofThe
von Waaden 2004 Revocable Trust and Xxxxx X. xxx Xxxxxx, Co-Trustee
ofThe von
Waaden
2004 Revocable Trust (the "Trust")
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NOTE:
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Those
two certain Secured Promissory Notes dated October 7, 2008, in
the
aggregate amounts of $2,800,000.00 made payable to the order of
Lenders
($1,866,666.66 to the Partnership and $933,333.33 to the Trust)
from
Debtor, as the same may be renewed, extended, modified or rearranged
from
time to time.
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LOAN
AGREEMENT: The Loan
Agreement dated October 9, 2008, executed by Xxxxxx and Xxxxxxx, as the same
may
be amended, modified, restated or replaced from time to time.
COLLATERAL: All
of Debtor=s
right, title, interest, claim and demand (but not Debtor=s
duties or obligations) in and to the following described contracts and all
payments (direct or indirect, whether in cash or otherwise), distributions,
and
rights to payment of every kind under and by virtue of (i) that certain Escrow
and Account Control Agreement dated as of October 9, 2008, by and among the
Debtor; and Xxxxx Fargo Bank,
National Association (as Escrow Agent), as now or hereafter amended or
modified (the “Escrow
Agreement”), and (ii) all accounts and general intangibles consisting of,
relating to or otherwise arising out of the Escrow Agreement and Debtor’s right,
title, interest, or claim (but not Debtor’s duties or obligations) in and to the
Escrow Property (as defined therein) and all payments, distributions, and
rights
to payment of every kind, under and by virtue of the Escrow
Agreement.
PROCEEDS: Any
and all proceeds of the Collateral, as the term “proceeds” is defined in the
Chapter 9 of the Texas Business and Commerce Code as now or hereafter adopted
or
amended (the "Texas
UCC"), including without limitation all accounts, general intangibles,
instruments, documents, moneys, insurance, chattel paper, income and other
property, benefits or rights of whatever kind or nature arising from,
attributable to, or accruing from any and all sales, leases, or other
dispositions of any or all of the Collateral.
1.
Agreement.
Subject to the terms and conditions of this Assignment, in consideration
of the
sum of Ten and No/100 Dollars ($10.00) and other good and valuable
consideration, the receipt and sufficiency of which Debtor acknowledges,
Debtor
hereby grants, assigns, transfers, and conveys, to Lenders, their successors
and
assigns, and grants to Lenders, their successors and assigns as security
for the
Obligations (as defined below) the Escrow Agreement and all other Collateral,
and Debtor hereby grants to Lenders, as security for the Obligations, a security
interest in and to the Collateral and Proceeds and all powers, benefits,
right,
title, and interest accruing and to accrue, and all revenues, moneys, fees,
commissions, profits, payments, and other sums payable and to be payable
to
Debtor and to which Debtor is or may hereafter become entitled to by virtue
of
the Collateral.
2.
Secured
Obligations. This security interest is granted to Lenders to
secure the following (the “Obligations”):
(a)
Payment of the principal sum, interest and indebtedness evidenced by the
Notes;
(b)
Payment of all other sums with interest thereon becoming due and payable
to
Lenders under the provisions of this Assignment or the Notes; and
(c)
Performance and discharge of each and every obligation, covenant and agreement
of Debtor contained in this Assignment, the Notes, the Loan Agreement, as
amended from time to time, and any and all other Loan Documents (as that
term is
defined in the Loan Agreement).
3.
Debtor’s
Representations and Warranties. Debtor represents and warrants
to Lenders and covenants as follows:
(a)
The execution, delivery and performance of this Assignment does not require
the
consent or approval of any governmental body or other regulatory authority
and
are not in contravention of, or in conflict with, any law or regulation or
any
term or provision of the Escrow Agreement. This Assignment is a valid, binding
and legally enforceable obligation of Debtor in accordance with its terms
except
only as enforceability may be affected or limited by creditors’ rights,
legislation and court decisions of general application.
(b)
The execution and delivery of this Assignment is not, and the performance
of
this Assignment will not be, in contravention of, or in conflict with, any
agreement, indenture or undertaking to which Debtor is a party or by which
Debtor or any of its property is or may be bound or affected, and do not
and
will not cause any security interest, lien or other encumbrance to be created
or
imposed or accelerated upon or in connection with any such
property.
(c)
Except for Lenders’ security interest therein (which Debtor has authority to
grant): (i) Debtor has not previously assigned, transferred,
conveyed, sold, pledged or hypothecated any part of the Collateral; (ii)
Debtor
is, and as to any Collateral acquired after the date hereof, Debtor shall
and
will be the owner of all the Collateral, free from any liens, security
interests, encumbrances or other right, title or interest of any other person,
firm or corporation; and (iii) Debtor shall defend the Collateral against
all
claims and demands of all persons at any time claiming the same or interest
therein adverse to Lenders.
(d)
No setoff or counterclaim to any money due or to become due to Debtor by
virtue
of the Collateral exists as of the date of this Assignment, and Debtor has
not
made any agreement pursuant to which any deduction or discount may be claimed
on
the Collateral, except as embodied in the express terms of the Escrow Agreement;
and
(e)
There is no financing statement (or other evidence of lien or security interest)
now on file in any public office covering any of the Collateral in which
Debtor
is named or signs as Debtor, and so long as any amount remains unpaid on
the
Obligations, Debtor will not execute and there will not be on file in any
public
office any such financing statement or statements (or other evidence of lien
or
security interest) except the Financing Statement filed or to be filed in
respect of and for the security interest to Lenders granted or provided for
in
this Assignment or any other security agreement or security agreements by
and
between Debtor and Lenders.
(f)
The Escrow Agreement is presently in full force and effect and binding upon
all
the parties thereto. No defaults or breaches have occurred in the Escrow
Agreement, including but not limited to such defaults or breaches which would
result in the reduction or termination of Debtor’s interest or rights to
payments and proceeds under the Escrow Agreement.
4.
Debtor’s
Agreements. Xxxxxx agrees as follows:
(a)
To do, make, procure, execute and deliver all acts, things, writings and
assurances as Xxxxxxx may at any time reasonably request, to protect, assure
or
enforce its interests, rights and remedies pursuant to this
Assignment.
(b)
At any time while a Default exists or after the occurrence of an Event of
Default (as those terms are defined in , upon Lenders’ request, to notify the
Escrow Agent in writing of the fact of this Assignment and direct such parties
to make payment direct to Lenders of any monies, accounts and general
intangibles included in the Collateral; provided that the foregoing shall
in no
manner impair Lenders’ right to notify such obligors as elsewhere herein
provided.
(d)
At any time while a Default exists or after the occurrence of any Event of
Default, to apply all proceeds of the Collateral, including without limitation
the Proceeds received by Lenders, on the Obligations, in any order of preference
which Lenders, in their discretion, choose, whether or not the Obligations
shall
have by their terms matured, such application to be made at such intervals
as
Lenders may determine.
(e)
To authorize, and Xxxxxx does hereby authorize, Xxxxxxx to contact directly
any
party to the Escrow Agreement to verify information furnished by
Debtor.
(f)
To at all times perform or cause to be performed each and every obligation
and
duty imposed upon Debtor by the Escrow Agreement and applicable law, and
to not
do any act or not omit to do any act which would constitute a breach of,
default
under or noncompliance with the Escrow Agreement and applicable
law.
(g)
Not to execute any amendment or modification of the Escrow Agreement or
otherwise change or alter any of the terms and provisions of the Escrow
Agreement without Lenders’ prior written consent.
(h)
To promptly notify Lenders of the occurrence of any event which constitutes
a
breach of, default under, or noncompliance with, or which with the passage
of
time, notice, or both, will constitute a breach of, default under, or
noncompliance with any of the terms and provisions of the Escrow
Agreement.
(i)
To send, with reasonable promptness, to Lenders copies of any and all notices
sent or received by Debtor under or pursuant to the Escrow Agreement or in
connection with Debtor’s interest in and under the Escrow
Agreement.
(j)
Not to sell, assign, transfer, encumber, pledge, hypothecate or otherwise
dispose of any or all of the Collateral or the Proceeds without Lenders=
prior written consent.
5.
Events
of
Default. Debtor shall be in default under this Assignment upon
the happening of any one or more of the Events of Default (as that term is
defined in the Loan Agreement).
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6.
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Lenders=s
Rights and Remedies.
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(a)
Debtor hereby irrevocably appoints each Lender as Debtor’s true and lawful agent
and attorney-in-fact, with full power of substitution, in Xxxxxxx' own names
or
in the name of Debtor, for Xxxxxxx’ sole use and benefit, but at Debtor’s cost
and expense, to exercise, upon the occurrence of an Event of Default, all
or any
of the following powers and rights with respect to the Collateral (without
any
obligation on the part of Lenders to exercise any of the following powers
and
rights): (1) to demand, receive, collect, sue and give acquittance for, settle,
compromise, compound, prosecute or defend any action or proceeding with respect
to the Collateral; (2) in the respective Lender’s name, or in Debtor’s name, to
endorse, collect, deposit and receipt for any checks, drafts or other means
of
payment thereof received from any source; (3) without limiting the foregoing,
to
receive, collect, and demand payment of all sums due and payable to Debtor
on
and under the Collateral, including without limitation all Proceeds, and
to
apply any and all such sums received and collected against the Obligations;
(4)
to notify any party to the Escrow Agreement with respect to any Proceeds
to make
payments thereon directly to Lenders; (5) to extend the time of payment of
any
or all of the Proceeds and to grant waivers and make any allowance or adjustment
with reference to the Collateral; and (6) to exercise, enforce, enjoy, carry
out, receive, and/or perform any and all rights, powers, duties, benefits,
obligations and remedies of Debtor with respect to and arising under the
Collateral; provided, however, Lenders=
exercise of or Lenders’ failure to exercise any such authority shall in no
manner affect Xxxxxx’s liability hereunder or under the Obligations, and
provided, further, that Lenders shall be under no obligation or duty to exercise
any of the powers hereby conferred upon them and shall be without liability
for
any act or failure to act in connection with the collection of, or the
preservation of any rights under, any of the Collateral. The agency
and authority hereby granted and created is an agency coupled with an
interest. Lenders shall not be bound to take any steps necessary to
preserve rights in any of the Collateral against prior parties.
(b)
Upon the occurrence of an Event of Default and at any time thereafter:
(1) Lenders shall have the rights and remedies provided in the Loan
Agreement, (2) Lenders shall have the rights and remedies provides in the
Texas
UCC, and (3) Lenders may notify any party to the Escrow Agreement that Lenders
are to receive, collect, and be paid any and all Escrow Property.
(c)
All recitals in any instrument of assignment or any other instrument executed
by
Lenders incident to the sale, transfer, assignment or other disposition or
utilization of the Collateral or any part thereof hereunder shall be full
proof
of the matters stated therein and no other proof shall be requisite to establish
full legal propriety of the sale or other action taken by Lenders or of any
fact, condition or thing incident thereto, and all prerequisites of such
sale or
other action shall be presumed conclusively to have been performed or to
have
occurred.
(d)
Notwithstanding a foreclosure sale, transfer, assignment or other disposition
of
or upon any of the Collateral hereunder or exercise of any other remedy by
Lenders in connection with an Event of Default, Debtor shall thereby not
be
subrogated to any of Lenders’ rights against the Collateral or any other
security for the Obligations, nor shall Debtor be deemed to be the owner
of any
interest in any of the Obligations, nor shall Debtor exercise any rights
or
remedies with respect to the Collateral or any other security for the
Obligations or any of them until all Obligations have been paid to Lenders
and
fully performed and discharged.
(e)
Debtor waives demand, notice, protest, and all demands and notices of any
action
taken by Xxxxxxx under this Assignment except as is specifically elsewhere
provided herein or in the Loan Documents and except as to notices which are
required (and which may not be waived under the provisions of the Texas UCC),
and any indulgence by Xxxxxxx, substitution for, exchange of, or release
of the
Collateral is hereby assented to and consented to.
(f)
Lenders shall not be responsible in any way for any depreciation or diminution
in the value or price of the Collateral, nor shall Lenders have any duty
or
responsibility whatsoever to enforce collection of the Collateral by legal
proceedings or otherwise, the sole duty of Lenders being to receive collections,
remittances and payments on the Collateral if and when tendered to Lenders,
and
at Lenders’ option to apply the amount or amounts so received, after deduction
of any collection costs incurred, as payment upon the Obligations of Lenders’
selection and designation.
7.
Indemnity. THE
INDEMNITY PROVISIONS CONTAINED IN THE LOAN AGREEMENT SHALL GOVERN THIS
ASSIGNMENT. The indemnification provided for in this Section shall
survive the termination of this Assignment and shall extend and continue
to
benefit each individual or entity who is or has at any time been an Indemnitee
(as that term is defined in the Loan Agreement).
8.
General. Xxxxxx
and Xxxxxxx agree as follows:
(a)
This Assignment and the security interests granted and created by this
Assignment shall not be affected by, affect, or impair any other security
or
liens now or hereafter taken for or securing the Obligations or any part
thereof, and no security hereafter taken for the Obligations or any part
thereof
shall in any manner be affected by, affect, or impair the security interests
granted and created by this Assignment. Any extensions may be made of the
Notes
or any other Obligations or any part thereof without affecting the priority
of
the security interest created by this Assignment or its validity with reference
to any third party. Debtor agrees that all such present and future security
shall be cumulative security and that Lenders may enforce its rights against
any
such security, as Lenders may elect, without waiving the other. The holder
of
the Indebtedness shall not be limited by any election of remedies if he chooses
to foreclose this security interest created by this Assignment by
suit.
(b)
Termination. It
is contemplated by the parties hereto that from time to time there may be
no
outstanding indebtedness under the Notes, but notwithstanding such occurrences,
this Assignment shall remain valid and shall be in full force and effect
as to
subsequent or previous outstanding Obligations. Upon (i) the
satisfaction in full of the Notes and all other Obligations, (ii) the
termination or expiration of any commitment of Lenders to extend credit to
Debtor, (iii) written request for the termination hereof delivered by Debtor
to
Lenders, and (iv) written release or termination delivered by Lenders to
Debtor,
this Assignment and the security interests created hereby shall
terminate. Upon termination of this Assignment and Xxxxxx’s written
request, Lenders will, at Debtor’s sole cost and expense, return to Debtor such
of the Collateral as shall not have been sold or otherwise disposed of or
applied pursuant to the terms hereof and execute and deliver to Debtor such
documents as Debtor shall reasonably request to evidence such
termination.
(c)
Lenders are not, by the entering into this Assignment or accepting the
assignment of and security interest in the Collateral and Proceeds, assuming
or
agreeing to assume any obligation or liabilities on the part of Debtor under
the
Escrow Agreement, nor shall any subsequent foreclosure on the part of Lenders
of
the security interest created hereby constitute, or be construed to be, an
assumption by Lenders of any obligation or liabilities on the part of Debtor
under the Escrow Agreement, whether now existing or hereafter
arising.
(e)
Xxxxxxx’ remedies hereunder are cumulative, and the exercise of any one or more
of the remedies provided for herein shall not be construed as a waiver of
any of
Lenders=
other remedies.
(f)
No indulgence by Xxxxxxx, or waiver of compliance with any provision hereof,
shall be construed as a waiver of Lenders’ right to subsequently require strict
performance hereof by Debtor.
(i)
THIS ASSIGNMENT HAS BEEN MADE IN, AND THE SECURITY INTEREST GRANTED HEREBY
IS
GRANTED IN, AND BOTH SHALL BE GOVERNED BY, THE LAWS OF THE STATE OF TEXAS
IN ALL
RESPECTS, INCLUDING WITHOUT LIMITATION, MATTERS OF CONSTRUCTION, VALIDITY,
ENFORCEMENT AND PERFORMANCE. This Assignment may not be modified, altered
or
amended except in writing duly signed by Xxxxxxx and by Debtor. Except as
the
context may otherwise require, any term used herein and defined in the Texas
UCC
shall have the meaning given therein. If any provision of this Assignment
is
rendered or declared illegal or unenforceable by reason of any existing or
subsequently enacted statute, rule or regulation, or by order of or judgment
of
a court, any and all other terms and provisions of this Assignment shall
remain
in full force and effect as stated and set forth herein.
(j)
All notices, demands, requests and other communications required or permitted
hereunder shall be given in accordance with the applicable provisions of
the
Loan Agreement.
(k)
This Assignment may be executed in any number of counterparts as may be
convenient or necessary, and it shall not be necessary that the signatures
of
all parties hereto or thereto be contained on any one counterpart hereof
or
thereof. Additionally, (a) the signature pages taken from separate individually
executed counterparts of this Assignment may be combined to form multiple
fully
executed counterparts and (b) a facsimile transmission shall be deemed to
be an
original signature. All executed counterparts of this Assignment shall be
deemed
to be originals, but all such counterparts taken together or collectively,
as
the case may be, shall constitute one and the same agreement.
(l)
This Assignment constitutes the entire agreement and understanding between
the
parties and supersedes all prior agreements and understandings, if any, between
them concerning the subject matter hereof, and there are no covenants,
agreements, promises, terms, provisions, conditions, undertakings or
understandings, either oral or written, between them concerning the subject
matter of this Assignment, except those which are expressly set forth in
this
Assignment.
(m)
This Assignment is one of the Loan Documents, as that term is defined in
the
Loan Agreement.
{SIGNATURE
PAGES TO FOLLOW}
983328v2
COUNTERPART
SIGNATURE PAGE FOR ATTACHMENT TO COLLATERAL ASSIGNMENT OF ESCROW AGREEMENT
AND
ESCROW FUNDS AMONG DENLY ACI
PARTNERS, LTD., A TEXAS LIMITED PARTNERSHIP, AND XXXXXX X. XXX XXXXXX,
AND XXXXX X.
XXX XXXXXX, AS CO-TRUSTEES OFTHE VON WAADEN 2004
REVOCABLE
TRUST (collectively, THE "LENDERS"),
AND AMERICA WEST RESOURCES,
INC.,
A NEVADA CORPORATION (THE "DEBTOR").
EXECUTED
as of the date first stated above.
Debtor:
a
Nevada corporation
By:
Xxx
X. Xxxxx,
Chief
Executive
Officer
COUNTERPART
SIGNATURE PAGE FOR ATTACHMENT TO COLLATERAL ASSIGNMENT OF ESCROW AGREEMENT
AND
ESCROW FUNDS AMONG DENLY ACI
PARTNERS, LTD., A TEXAS LIMITED PARTNERSHIP, AND XXXXXX X. XXX XXXXXX,
AND XXXXX X.
XXX XXXXXX, AS CO-TRUSTEES OFTHE VON WAADEN 2004
REVOCABLE
TRUST (collectively, THE "LENDERS"),
AND AMERICA WEST RESOURCES,
INC.,
A NEVADA CORPORATION (THE "DEBTOR").
EXECUTED
as of the date first stated above.
Lenders:
Denly
ACI Partners, Ltd.,
a
Texas limited
partnership
By:
Denly ACI Mgt., LLC,
a
Texas limited liability
company,
its
sole General Partner
By:
Xxxxxx
X. xxx Xxxxxx,
Manager
By:
Xxxxx
X. xxx Xxxxxx,
Manager
Xxxxxx
X. xxx Xxxxxx, Co-Trustee of
the
von
Waaden 2004 Revocable
Trust
Xxxxx
X. xxx Xxxxxx, Co-Trustee of
the
von
Waaden 2004 Revocable
Trust
