EXHIBIT 10.4
SECOND LIEN DEED OF TRUST, ASSIGNMENT OF LEASES AND RENTS,
SECURITY AGREEMENT, FINANCING STATEMENT AND FIXTURE FILING
FROM
DEL LABORATORIES, INC.
To
Xxxxxxxxxx & Xxxxxxx, LLP
as Trustee for the benefit of
JPMORGAN CHASE BANK, N.A.
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Dated: December ___, 2005
Premises: Xxxxxx Xxxx
Xxxxx Xxxxx, Xxxxx Xxxxxxxx 00000
County of Xxxxxx
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COLLATERAL IS OR INCLUDES FIXTURES
(THIS DOCUMENTS SERVES AS A FIXTURE FILING UNDER SECTION 25-9-502 OF THE NORTH
CAROLINA UNIFORM COMMERCIAL CODE.) THIS DEED OF TRUST IS GIVEN PARTLY TO SECURE
FUTURE OBLIGATIONS WHICH MAY BE INCURRED HEREUNDER.
Prepared by and after recordation return to:
Xxxxxx & Xxxxxxx LLP
000 Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxxxx Xxxxxxxx, Esq.
TABLE OF CONTENTS
1.DEFINITIONS..................................................................1
2.GRANT........................................................................3
3.WARRANTIES, REPRESENTATIONS AND COVENANTS....................................3
3.1 Title to Mortgaged Property and Lien of this Instrument......3
3.2 Second Lien Status...........................................3
3.3 Payment and Performance......................................3
3.4 Replacement of Fixtures and Personalty.......................3
3.5 Maintenance of Rights of Way, Easements and Licenses.........4
3.6 Inspection...................................................4
3.7 Other Covenants..............................................4
4.DEFAULT AND FORECLOSURE......................................................4
4.1 Remedies.....................................................4
4.2 Separate Sales...............................................6
4.3 Remedies Cumulative, Concurrent and Nonexclusive.............6
4.4 Release of and Resort to Collateral..........................6
4.5 Waiver of Redemption, Notice and Marshalling of Assets.......6
4.6 Discontinuance of Proceedings................................6
4.7 Application of Proceeds......................................7
4.8 Occupancy After Foreclosure..................................7
4.9 Protective Advances and Disbursements; Costs of
Enforcement............................................7
4.10 No Beneficiary in Possession.................................8
5.ASSIGNMENT OF RENTS AND LEASES...............................................8
5.1 Assignment...................................................8
5.2 No Obligation................................................8
5.3 Right to Apply Rents.........................................8
0.XXXXXXXX AGREEMENT...........................................................9
6.1 Security Interest............................................9
6.2 Financing Statements.........................................9
6.3 Fixture Filing...............................................9
7.CONCERNING THE TRUSTEE.......................................................9
7.1 Certain Rights...............................................9
7.2 Retention of Money..........................................10
7.3 Successor or Trustee........................................10
7.4 Perfection of Appointment...................................10
7.5 Trustee Liability...........................................10
8.MISCELLANEOUS...............................................................10
8.1 Notices.....................................................10
8.2 Covenants Running with the Land.............................11
8.3 Attorney-in-Fact............................................12
8.4 Successors and Assigns......................................12
8.5 No Waiver...................................................12
8.6 Subrogation.................................................12
8.7 Credit Agreement............................................12
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8.8 Release.....................................................12
8.9 Waiver of Stay, Moratorium and Similar Rights...............13
8.10 Obligations of Grantor, Joint and Several...................13
8.11 Governing Law...............................................13
8.12 Headings....................................................13
8.13 Entire Agreement............................................13
8.14 Future Advances.............................................13
8.15 Intercreditor Agreement.....................................14
Exhibit A: legal description
INDEX OF DEFINED TERMS
Administrative Agent................................1
Beneficiary.........................................1
Covenants...........................................1
Credit Agreement....................................1
Deed of Trust.......................................1
Fixtures............................................2
Grantor.............................................1
Improvements........................................2
Intercreditor Agreement.............................1
Land................................................1
Leases..............................................2
Lenders.............................................1
Loan Documents......................................1
Mortgaged Property..................................1
Obligations.........................................3
Permitted Encumbrances..............................3
Personalty..........................................2
Plans...............................................2
Property Agreements.................................2
Rents...............................................2
Trustee.............................................1
UCC.................................................3
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SECOND LIEN DEED OF TRUST, ASSIGNMENT OF LEASES AND RENTS,
SECURITY AGREEMENT, FINANCING STATEMENT AND FIXTURE FILING
This Second Lien Deed of Trust, Assignment of Leases and Rents, Security
Agreement, Financing Statement and Fixture Filing (this "DEED OF TRUST") is
executed as of December ___, 2005, by DEL LABORATORIES, INC., a Delaware
corporation ("GRANTOR"), having an address at 000 XXX Xxxxx, Xxxxxxxxx, Xxx Xxxx
00000, in favor of Xxxxxxxxxx & Xxxxxxx, LLP ("TRUSTEE"), having an address at
X.X. Xxx 000, Xxxxxx, Xxxxx Xxxxxxxx 00000, for the benefit of XX XXXXXX CHASE
BANK, N.A., a New York banking corporation ("BENEFICIARY"), having an address at
000 Xxxx Xxxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, in its capacity as
administrative agent ("ADMINISTRATIVE AGENT") for the Lenders under the Credit
Agreement more fully described below.
1. DEFINITIONS
As used herein, the following terms shall have the following meanings:
"COVENANTS": All of the agreements, covenants, conditions and other obligations
made or undertaken by Grantor or any other person or entity to Beneficiary or to
any other Secured Party (as defined in the Guarantee and Collateral Agreement)
as set forth in the Loan Documents.
"INTERCREDITOR AGREEMENT": The Intercreditor Agreement dated as of October 28,
2005 by and among Borrower, Beneficiary, in its capacity as Administrative Agent
under the Credit Agreement and Xxxxx Fargo Bank, N.A., in its capacity as
Collateral Agent under the Collateral Agency Agreement dated as of October 28,
2005 between it, as Collateral Agent, and Xxxxx Fargo Bank, N.A., as trustee
under the Senior Secured Note Indenture (as defined in the Credit Agreement).
"LOAN DOCUMENTS": The (1) Credit Agreement dated as of December ___, 2005 by and
among DLI Holding II Corp., a Delaware corporation, Del Laboratories, Inc., a
Delaware corporation, as borrower, the several banks and other financial
institutions or entities from time to time parties to the Credit Agreement
("LENDERS"), X.X. Xxxxxx Securities, Inc., as sole lead arranger and sole
bookrunner, and Beneficiary, as Administrative Agent (the "CREDIT AGREEMENT"),
(2) the Security Documents (including this Deed of Trust) and the Notes, each as
defined in the Credit Agreement and (3) each other agreement, certificate or
document executed by any Group Member (as defined in the Credit Agreement) and
delivered to any Agent (as defined in the Credit Agreement) or any Lender
pursuant to the Credit Agreement or any Security Document.
"MORTGAGED PROPERTY": All of Grantor's right, title and interest in or to (1)
the real property described in EXHIBIT A, together with any greater estate
therein as hereafter may be acquired by Grantor (the "LAND"), (2) buildings,
structures and other improvements, now or at any time situated, placed or
constructed upon the Land (the "IMPROVEMENTS"), (3) fixtures, materials,
supplies, equipment, apparatus and other items of personal property now owned or
hereafter acquired by Grantor and now or hereafter attached to, installed in or
used primarily in connection with any of the Improvements or the Land, and all
water, gas, electrical, storm and sanitary sewer facilities and all other
utilities whether or not situated in easements (the "FIXTURES"), (4) all goods,
accounts, general intangibles, instruments, documents, chattel paper and all
other personal property of any kind or character, including such items of
personal property as defined in the UCC, now owned or hereafter acquired by
Grantor and now or hereafter affixed to, placed upon, used primarily in
connection with, or arising from or otherwise related to the Land and
Improvements or that may be used in or relating to the planning, development,
financing or operation of the Mortgaged Property, including, without limitation,
furniture, furnishings, equipment, machinery, money, insurance proceeds,
accounts, contract rights, goodwill, chattel paper, documents, property licenses
and/or franchise agreements, rights of Grantor under leases of Fixtures or other
personal property or equipment, inventory, all refundable, returnable or
reimbursable fees, deposits or other funds or evidences of credit or
indebtedness deposited by or on behalf of Grantor with any governmental
authorities, boards, corporations, providers of utility services, public or
private, including specifically, but without limitation, all refundable,
returnable or reimbursable tap fees, utility deposits, commitment fees and
development costs but only to the extent assignable (the "PERSONALTY"), (5)
reserves, escrows or impounds required under the Credit Agreement and all
deposit accounts maintained by Grantor with respect solely to the Mortgaged
Property, (6) plans, specifications, shop drawings and other technical
descriptions prepared for construction, repair or alteration of the
Improvements, and all amendments and modifications thereof (the "Plans"), (7)
all leases, subleases, licenses, concessions, occupancy agreements or other
agreements (written or oral, now or at any time in effect) which grant a
possessory interest in, or the right to use, all or any part of the Mortgaged
Property (the "LEASES"), together with all related security and other deposits,
(8) all of the rents, revenues, income, proceeds, profits, security and other
types of deposits, and other benefits paid or payable by parties to the Leases
other than Grantor for using, leasing, licensing, possessing, operating from,
residing in, selling or otherwise enjoying the Mortgaged Property (the "RENTS"),
(9) to the extent assignable, all other agreements, such as construction
contracts, architects' agreements, engineers' contracts, utility contracts,
maintenance agreements, management agreements, service contracts, permits,
licenses, certificates and entitlements in any way relating to the development,
construction, use, occupancy, operation, maintenance, enjoyment, acquisition or
ownership of the Mortgaged Property (the "PROPERTY AGREEMENTS"), (10) all
rights, privileges, tenements, hereditaments, rights-of-way, easements,
appendages and appurtenances appertaining to the foregoing, and all right, title
and interest, if any, of Grantor in and to any streets, ways, alleys, strips or
gores of land adjoining the Land or any part thereof, (11) accessions,
replacements and substitutions for any of the foregoing and all proceeds
thereof, (12) all proceeds of and any unearned premiums on any insurance
policies covering any of the above property now or hereafter acquired by
Grantor, (13) all mineral, water, oil and gas rights now or hereafter acquired
and relating to all or any part of the Mortgaged Property and (14) any awards,
remunerations, reimbursements, settlements or compensation heretofore made or
hereafter to be made by any governmental authority pertaining to the Land,
Improvements, Fixtures or Personalty. As used in this Deed of Trust, the term
"MORTGAGED PROPERTY" shall mean all or, where the context permits or requires,
any portion of the above or any interest therein.
"OBLIGATIONS": As defined in the Credit Agreement, as well as all obligations
arising under the Guarantee and Collateral Agreement and including, without
limitation, all other indebtedness, obligations and liabilities now or hereafter
existing of any kind of Grantor to Beneficiary or the Lenders under documents
that recite that they are intended to be secured by this Deed of Trust.
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"PERMITTED ENCUMBRANCES": The outstanding liens, easements, restrictions,
security interests and other exceptions to title set forth in the policy of
title insurance insuring the lien of this Deed of Trust issued on the date
hereof, together with the liens and security interests in favor of Beneficiary
created or permitted by the Loan Documents and Section 7.3 of the Credit
Agreement.
"UCC": The Uniform Commercial Code of the State of North Carolina or the Uniform
Commercial Code in effect in any other state if applicable.
All terms used but not otherwise defined herein shall have the meanings ascribed
to them in the Credit Agreement.
2. GRANT. To secure the full and timely payment and performance of the
Obligations, Grantor MORTGAGES, GRANTS, BARGAINS, SELLS, TRANSFERS, ASSIGNS and
HYPOTHECATES and CONVEYS the Mortgaged Property to Trustee, IN TRUST, WITH POWER
OF SALE, subject, however, to the Permitted Encumbrances. The latest scheduled
maturity date of the secured debt is December ___, 2010.
3. WARRANTIES, REPRESENTATIONS AND COVENANTS. Grantor warrants, represents
and covenants to Trustee and Beneficiary as follows:
3.1. TITLE TO MORTGAGED PROPERTY AND LIEN OF THIS INSTRUMENT. Grantor owns
the Mortgaged Property free and clear of any liens, claims or interests, except
the Permitted Encumbrances. This Deed of Trust creates a valid, enforceable
second priority lien and security interest against the Mortgaged Property
subject only to the Permitted Encumbrances.
3.2. SECOND LIEN STATUS. Grantor shall preserve and protect the second lien
and security interest status of this Deed of Trust and the other Loan Documents.
If any lien or security interest other than a Permitted Encumbrance is asserted
against the Mortgaged Property, Grantor shall promptly, and at its expense, (a)
give Beneficiary a detailed written notice of such lien or security interest
(including origin, amount and other terms), and (b) pay the underlying claim in
full or take such other action so as to cause it to be released or contest the
same in compliance with the requirements of the Credit Agreement (including the
requirement of providing a bond or other security satisfactory to Beneficiary to
the extent required by the Credit Agreement).
3.3. PAYMENT AND PERFORMANCE. Grantor shall pay and perform the Obligations
when due under the Loan Documents to which it is a party and shall perform the
Covenants under the Loan Documents to which it is a party in full when they are
required to be performed.
3.4. REPLACEMENT OF FIXTURES AND PERSONALTY. Except as permitted by the
Credit Agreement, Grantor shall not, without the prior written consent of
Beneficiary, not to be unreasonably withheld, permit any of the Fixtures or
Personalty to be removed at any time from the Land or Improvements, unless the
removed item is removed temporarily for maintenance and repair or, if removed
permanently, is immaterial or is obsolete and in either case, is replaced by an
article of equal or better suitability and value, owned by Grantor subject to
the liens and security interests of this Deed of Trust and the other Loan
Documents, and free and clear of any other lien or security interest except such
as may be first approved in writing by Beneficiary.
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3.5. MAINTENANCE OF RIGHTS OF WAY, EASEMENTS AND LICENSES. Grantor shall
maintain, in the ordinary course of business, all rights of way, easements,
grants, privileges, licenses, certificates, permits, entitlements and franchises
necessary for the use of the Mortgaged Property and will not, without the prior
consent of Beneficiary, not to be unreasonably withheld or delayed, consent to
any public restriction (including any zoning ordinance) or private restriction
as to the use of the Mortgaged Property which restriction is reasonably likely
to materially and adversely affect the current use of the Mortgaged Property.
Grantor shall comply in all material respects with all restrictive covenants
affecting the Mortgaged Property, and all zoning ordinances and other public or
private restrictions as to the use of the Mortgaged Property.
3.6. INSPECTION. Grantor shall permit Beneficiary and its agents,
representatives and employees, upon reasonable prior notice to Grantor and
during normal business hours (except in the case of an emergency, in which case
no notice shall be necessary), to inspect the Mortgaged Property and conduct
such environmental, to the extent Beneficiary believes that there is a
reasonable possibility that a release of Materials of Environmental Concern in
violation of Environmental Laws may have occurred or is occurring, engineering
and other studies as Beneficiary may reasonably require, provided that such
inspections and studies shall not materially interfere with the use and
operation of the Mortgaged Property. Beneficiary shall indemnify Grantor for all
losses relating to its or its agent's gross negligence and willful misconduct in
connection with such inspection and studies.
3.7. OTHER COVENANTS. All of the covenants in the Credit Agreement are
incorporated herein by reference.
4. DEFAULT AND FORECLOSURE
4.1 REMEDIES. During the occurrence and continuance of an Event of Default,
Beneficiary may, at Beneficiary's election and by or through Trustee or
otherwise, exercise any or all of the following rights, remedies and recourses:
4.1.1. Acceleration. To the extent permitted by the Credit Agreement, declare
the Obligations to be immediately due and payable, without further notice,
presentment, protest, notice of intent to accelerate, notice of acceleration,
demand or action of any nature whatsoever (each of which hereby is expressly
waived by Grantor), whereupon the same shall become immediately due and payable.
4.1.2. Entry on Mortgaged Property. Enter the Mortgaged Property and take
exclusive possession thereof and of all books, records and accounts relating
thereto. If Grantor remains in possession of the Mortgaged Property after an
Event of Default and without Beneficiary's prior written consent, Beneficiary
may invoke any legal remedies to dispossess Grantor.
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4.1.3. Operation of Mortgaged Property. Hold, lease, develop, manage, operate
or otherwise use the Mortgaged Property upon such terms and conditions as
Beneficiary may deem reasonable under the circumstances (making such repairs,
alterations, additions and improvements and taking other actions, from time to
time, as Beneficiary deems necessary or desirable), and apply all Rents and
other amounts collected by Trustee in connection therewith in accordance with
the provisions of SECTION 4.7 hereof.
4.1.4. Remedies of Beneficiary upon Default. Upon the occurrence of any Event
of Default, Beneficiary may, at its option, without prior notice to Grantor,
declare the Obligations to be immediately due and payable in full; and, on
application of Beneficiary, Trustee shall foreclose this Deed of Trust in any
manner permitted by North Carolina law, including selling the Mortgaged Property
or any part thereof at public sale to the last and highest bidder for cash, free
of any equity of redemption, homestead, dower, curtesy or other state or federal
exemption, all of which are expressly waived by Grantor, after compliance with
applicable North Carolina laws relating to foreclosure sales under power of
sale; and Trustee shall execute and deliver to the purchaser a Trustee's deed
conveying the Mortgaged Property so sold without any covenant or warranty,
expressed or implied. The recitals in the Trustee's deed shall be prima facie
evidence of the truth of the statements made therein. The proceeds of any such
sale shall be applied in the manner and in the order prescribed by applicable
North Carolina law, it being agreed that the expenses of any such sale shall
include a commission of five per cent of the gross sales price to Trustee for
holding such sale and for all services performed by him hereunder excluding
expenses incurred in making sale. In the event a foreclosure suit or special
proceeding is commenced, and no sale is held, then the Grantor shall pay to the
Trustee: (a) all expenses incurred by Trustee and (b) a partial commission
computed on five percent of the balance of the unpaid Obligations. Beneficiary
may bid and become the purchaser at any sale under this Deed of Trust. At any
such sale Trustee may at his election require the successful bidder immediately
to deposit with Trustee cash in an amount equal to all or any part of the
successful bid and notice of any such requirement need not be included in the
advertisement of the notice of such sale. If foreclosure proceedings are
instituted under this Deed of Trust, Trustee is hereby authorized to take
possession of the Mortgaged Property and collect any rental accrued or to
accrue; or Trustee may lease the Mortgaged Property or any part thereof, receive
the rents and profits therefrom, and hold the proceeds remaining after payment
of the expenses of managing and operating the Mortgaged Property subject to the
order of the court for the benefit of Beneficiary, pending final disposition on
the foreclosure proceedings, and during any period allowed by applicable law for
the redemption from any foreclosure sale ordered in such proceedings; and
Trustee may act irrespective of the value of the Mortgaged Property or its
adequacy or inadequacy to secure or discharge the indebtedness then owing.
4.1.5 Receiver. Make application to a court of competent jurisdiction for, and
obtain from such court as a matter of strict right and without notice to Grantor
or regard to the adequacy of the Mortgaged Property for the repayment of the
Obligations, the appointment of a receiver of the Mortgaged Property, and
Grantor irrevocably consents to such appointment. Any such receiver shall have
all the usual powers and duties of receivers in similar cases, including the
full power to rent, maintain and otherwise operate the Mortgaged Property upon
such terms as may be approved by the court, and shall apply such Rents in
accordance with the provisions of Section 4.7 hereof.
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4.1.6. Other. Exercise all other rights, remedies and recourses granted under
the Loan Documents or otherwise available at law or in equity (including an
action for specific performance of any covenant contained in the Loan Documents,
or a judgment on the Notes either before, during or after any proceeding to
enforce this Deed of Trust).
4.2. SEPARATE SALES. The Mortgaged Property may be sold in one or more
parcels and in such manner and order as Beneficiary in its sole discretion may
elect in accordance with any applicable Requirement of Law; the right of sale
arising out of any Event of Default shall not be exhausted by any one or more
sales described in the foregoing sentence.
4.3. REMEDIES CUMULATIVE, CONCURRENT AND NONEXCLUSIVE. Trustee and
Beneficiary shall have all rights, remedies and recourses granted in the Loan
Documents and available at law or equity (including the UCC), which rights (a)
shall be cumulative and concurrent, (b) may be pursued separately, successively
or concurrently against Grantor or others obligated under the Note and the other
Loan Documents, or against the Mortgaged Property, or against any one or more of
them, at the sole discretion of Beneficiary, (c) may be exercised as often as
occasion therefor shall arise, and the exercise or failure to exercise any of
them shall not be construed as a waiver or release thereof or of any other
right, remedy or recourse, and (d) are intended to be, and shall be,
nonexclusive. No action by Trustee or Beneficiary in the enforcement of any
rights, remedies or recourses under the Loan Documents or otherwise at law or
equity shall be deemed to cure any Event of Default.
4.4. RELEASE OF AND RESORT TO COLLATERAL. Beneficiary may release,
regardless of consideration and without the necessity for any notice to or
consent by the holder of any subordinate lien on the Mortgaged Property, any
part of the Mortgaged Property without, as to the remainder, in any way
impairing, affecting, subordinating or releasing the lien or security interests
created in or evidenced by the Loan Documents or their stature as a second and
prior lien and security interest in and to the remaining Mortgaged Property. For
payment of the Obligations, Beneficiary may resort to any other security in such
order and manner as Beneficiary may elect.
4.5. WAIVER OF REDEMPTION, NOTICE AND MARSHALLING OF ASSETS. To the fullest
extent permitted by law, Grantor hereby irrevocably and unconditionally waives
and releases (a) all benefit that might accrue to Grantor by virtue of any
present or future statute of limitations or law or judicial decision exempting
the Mortgaged Property from attachment, levy or sale on execution or providing
for any appraisement, valuation, stay of execution, exemption from civil
process, redemption or extension of time for payment, (b) all notices of
Trustee's election to exercise or its actual exercise of any right, remedy or
recourse provided for under the Loan Documents, and (c) any right to a
marshalling of assets or a sale in inverse order of alienation. Grantor waives
any right or remedy which Grantor may have or be able to assert pursuant to any
provision of North Carolina law, including, without limitation, the rights or
remedies set forth in N.C. Gen. Stat. ss.26-7, et. seq., pertaining to the
rights and remedies of sureties.
4.6. DISCONTINUANCE OF PROCEEDINGS. If Beneficiary shall have proceeded to
invoke any right, remedy or recourse permitted under the Loan Documents and
shall thereafter elect to discontinue or abandon it for any reason, Beneficiary
shall have the unqualified right to do so and, in such an event, Grantor,
Trustee and Beneficiary shall be restored to their former positions with respect
to the Obligations, the Loan Documents, the Mortgaged Property and otherwise,
and the rights, remedies, recourses and powers of Trustee and Beneficiary shall
continue as if the right, remedy or recourse had never been invoked, but no such
discontinuance or abandonment shall waive any Event of Default that may then
exist or the right of Trustee and Beneficiary thereafter to exercise any right,
remedy or recourse under the Loan Documents for such Event of Default.
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4.7. APPLICATION OF PROCEEDS. The proceeds of any sale of, and the Rents and
other amounts generated by the holding, leasing, management, operation or other
use of the Mortgaged Property, shall be applied by Beneficiary or Trustee (or
the receiver, if one is appointed) in the following order unless otherwise
required by the Credit Agreement or applicable law:
4.7.1. to the payment of the out-of-pocket costs and expenses actually
incurred by Beneficiary in taking possession of the Mortgaged Property and of
holding, using, leasing, repairing, improving and selling the same, including,
without limitation: (1) trustee's and receiver's reasonable fees and expenses,
(2) court costs, (3) reasonable out-of-pocket attorneys' and accountants' fees
and expenses, (4) costs of advertisement, and (5) the payment of all ground
rent, real estate taxes and assessments, except any taxes, assessments or other
charges subject to which the Mortgaged Property shall have been sold;
4.7.2 to the payment of all amounts (including interest), other than the payment
of the Obligations, which may be due to Beneficiary under the Loan Documents;
4.7.3 to the payment of the Obligations and performance of the Covenants under
the Loan Documents in such manner and order of preference as Beneficiary in its
sole discretion may determine in accordance with the terms of the Credit
Agreement; and
4.7.4 the balance, if any, to the payment of the persons legally entitled
thereto.
4.8 OCCUPANCY AFTER FORECLOSURE. The purchaser at any foreclosure sale pursuant
to SECTION 4.1.4 shall become the legal owner of the Mortgaged Property. All
occupants of the Mortgaged Property shall, at the option of such purchaser,
become tenants of the purchaser at the foreclosure sale and shall deliver
possession thereof immediately to the purchaser upon demand. It shall not be
necessary for the purchaser at said sale to bring any action for possession of
the Mortgaged Property other than the statutory action of forcible detainer in
any justice court having jurisdiction over the Mortgaged Property.
4.9. PROTECTIVE ADVANCES AND DISBURSEMENTS; COSTS OF ENFORCEMENT.
4.9.1 If any Event of Default exists, Beneficiary shall have the right, but not
the obligation, to cure such Event of Default in the name and on behalf of
Grantor. All sums advanced and expenses incurred at any time by Beneficiary
under this Section, or otherwise under this Deed of Trust or any of the other
Loan Documents or applicable law, shall bear interest from the date that such
sum is advanced or expense incurred, to and including the date of reimbursement,
computed at the interest rate applicable to overdue Reimbursement Obligations
under Section 3.5(c) of the Credit Agreement, and all such sums, together with
interest thereon, shall be secured by this Deed of Trust.
4.9.2 Grantor shall pay all expenses (including reasonable out-of-pocket
attorneys' fees and expenses) of or incidental to the perfection and enforcement
of this Deed of Trust and the other Loan Documents, or the enforcement,
compromise or settlement of the Obligations or any claim under this Deed of
Trust and the other Loan Documents, and for the curing thereof, or for defending
or asserting the rights and claims of Beneficiary in respect thereof, by
litigation or otherwise.
4.10 NO BENEFICIARY IN POSSESSION. Neither the enforcement of any of the
remedies under this Article, the assignment of the Rents and Leases under
ARTICLE 5, the security interests under ARTICLE 6, nor any other remedies
afforded to Trustee or Beneficiary under the Loan Documents, at law or in equity
shall cause Trustee or Beneficiary to be deemed or construed to be a Beneficiary
in possession of the Mortgaged Property, to obligate Trustee or Beneficiary to
lease the Mortgaged Property or attempt to do so, or to take any action, incur
any expense, or perform or discharge any obligation, duty or liability
whatsoever under any of the Leases or otherwise.
5. ASSIGNMENT OF RENTS AND LEASES
5.1 ASSIGNMENT. Grantor hereby grants to Beneficiary a present, absolute
assignment of the Leases and Rents. While any Event of Default exists,
Beneficiary shall be entitled to (a) notify any person that the Leases have been
assigned to Beneficiary and that all Rents are to be paid directly to
Beneficiary, whether or not Trustee or Beneficiary has commenced or completed
foreclosure or taken possession of the Mortgaged Property; (b) settle,
compromise, release, extend the time of payment of, and make allowances,
adjustments and discounts of any Rents or other obligations under the Leases;
(c) enforce payment of Rents and other rights under the Leases, prosecute any
action or proceeding, and defend against any claim with respect to Rents and
Leases; (d) enter upon, take possession of and operate the Mortgaged Property;
(e) lease all or any part of the Mortgaged Property; and/or (f) perform any and
all obligations of Grantor under the Leases and exercise any and all rights of
Grantor therein contained to the full extent of Grantor's rights and obligations
thereunder, with or without the bringing of any action or the appointment of a
receiver. For so long as no Event of Default exists, Grantor shall have a
revocable license to deal with and enjoy the rights otherwise described in the
preceding sentence.
5.2. NO OBLIGATION. Notwithstanding Beneficiary's rights hereunder,
Beneficiary shall not be obligated to perform, and Beneficiary does not
undertake to perform, any obligation, duty or liability with respect to the
Leases or Rents on account of this Deed of Trust. Trustee and Beneficiary shall
have no responsibility on account of this Deed of Trust for the control, care,
maintenance or repair of the Mortgaged Property, for any waste committed on the
Mortgaged Property, for any dangerous or defective condition of the Mortgaged
Property, or for any negligence in the management, upkeep, repair or control of
the Mortgaged Property except to the extent any of the foregoing are caused by
Beneficiary or its agents.
5.3. RIGHT TO APPLY RENTS. Beneficiary shall have the right, but not the
obligation, to use and apply any Rents received hereunder in such order and such
manner as Beneficiary may determine, including, without limitation, for: (a) the
payment of out-of-pocket costs and expenses of enforcing or defending the terms
of this Deed of Trust or the rights of Beneficiary hereunder, and collecting any
Rents and (b) the payment of costs and expenses of the operation and maintenance
of the Mortgaged Property.
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6. SECURITY AGREEMENT
6.1 SECURITY INTEREST. This Deed of Trust constitutes a "Security Agreement" on
personal property within the meaning of the UCC and other applicable law and
with respect to the Personalty, Fixtures, Plans, Leases, Rents and Property
Agreements. To this end, Grantor grants to Trustee and Beneficiary a second and
prior security interest in the Personalty, Fixtures, Plans, Leases, Rents and
Property Agreements and all other Mortgaged Property, to the extent the
Mortgaged Property may be subject to UCC, that is personal property to secure
the payment of the Obligations and performance of the Covenants under the Loan
Documents, and agrees that Trustee and Beneficiary shall have all the rights and
remedies of a secured party under the UCC with respect to such property. Any
notice of sale, disposition or other intended action by Beneficiary with respect
to the Personalty, Fixtures, Plans, Leases, Rents and Property Agreement sent to
Grantor at least ten (10) days prior to any action under the UCC shall
constitute commercially reasonable notice to Grantor.
6.2. FINANCING STATEMENTS. Grantor shall execute and deliver to Beneficiary,
in form and substance satisfactory to Beneficiary, such UCC financing statements
and such further forms as Beneficiary may, from time to time, reasonably
consider necessary to create, perfect and preserve Beneficiary's lien priority
and security interest hereunder and Beneficiary may cause such statements and
assurances to be recorded and filed, at such times and places as may be required
or permitted by law to so create, perfect and preserve such security interest.
6.3. FIXTURE FILING. This Deed of Trust shall constitute a fixture filing in
accordance with N.C. Gen. Stat. ss. 25-9-502, to be recorded in the real estate
records of the appropriate county in which the land is located. For purposes of
complying with the requirement of N.C. Gen. Stat. ss. 25-9-502, the name of
Grantor, as "debtor", and Beneficiary, as "secured party", and the respective
addresses of Grantor, as "debtor", and Beneficiary, as "secured party", are set
forth on the first page of this Deed of Trust; the types or items of
"collateral" are described in the definition of "Mortgaged Property" appearing
in the granting clauses of this Deed of Trust; and the description of the "land"
is set forth on Exhibit "A" attached hereto.
7. CONCERNING THE TRUSTEE
7.1 CERTAIN RIGHTS. With the approval of Beneficiary, Trustee shall have the
right to select, employ and consult with counsel. 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 him hereunder, believed by him in good
faith to be genuine. Trustee shall be entitled to reimbursement for actual,
reasonable expenses incurred by him in the performance of his duties, including
those arising from the joint, concurrent or comparative negligence of Trustee;
however, Grantor shall not be liable under such indemnification to the extent
such liability or expenses result solely from Trustee's gross negligence or
willful misconduct hereunder. Grantor shall, from time to time, pay the
compensation due to Trustee hereunder and reimburse Trustee for, and indemnify,
defend and save Trustee harmless against, all liability and reasonable expenses
which may be incurred by him in the performance of his duties other than
liabilities or expenses arising or accruing as a result of Trustee's gross
negligence or willful misconduct. Grantor's obligations under this Section shall
not be reduced or impaired by principles of comparative or contributory
negligence.
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7.2. RETENTION OF MONEY. All moneys received by Trustee shall, until used or
applied as herein provided, be held in trust for the purposes for which they
were received, but need not be segregated in any manner from any other moneys
(except to the extent required by law), and Trustee shall be under no liability
for interest on any moneys received by him hereunder.
7.3. SUCCESSOR OR TRUSTEE. If Trustee or any successor Trustee shall die,
resign or become disqualified from acting in the execution of this trust, or
Beneficiary shall desire to appoint a substitute Trustee, Beneficiary shall have
full power to appoint one or more substitute Trustees and, if preferred, several
substitute Trustees in succession who shall succeed to all the estates, rights,
powers and duties of Trustee. Such appointment may be executed by any authorized
agent of Beneficiary, and as so executed, such appointment shall be conclusively
presumed to be executed with authority, valid and sufficient, without further
proof of any action.
7.4. PERFECTION OF APPOINTMENT. Should any deed, conveyance or instrument of
any nature be required from Grantor by any successor Trustee to more fully and
certainly vest in and confirm to such successor Trustee such estates, rights,
powers and duties, then, upon request by such Trustee, all such deeds,
conveyances and instruments shall be made, executed, acknowledged and delivered
and shall be caused to be recorded and/or filed by Grantor.
7.5. TRUSTEE LIABILITY. In no event or circumstance shall Trustee or any
substitute Trustee hereunder be personally liable under or as a result of this
Deed of Trust, either as a result of any action by Trustee (or any substitute
Trustee) in the exercise of the powers hereby granted or otherwise, except due
to Trustee's gross negligence or willful misconduct.
8. MISCELLANEOUS
8.1 NOTICES. All notices, requests and demands to or upon the respective parties
hereto to be effective shall be in writing (including by telecopy), and, unless
otherwise expressly provided herein, shall be deemed to have been duly given or
made when delivered, or three Business Days after being deposited in the mail,
postage prepaid, or, in the case of telecopy notice, when received, addressed as
follows in the case of Grantor, the Beneficiary and the Trustee, or to such
other address as may be hereafter notified by the respective parties hereto:
If to Grantor, to:
Del Laboratories, Inc.
Attention: Chief Financial Officer
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
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with a copy to:
Attention: Xxxxx X. Xxxxxxxxxx
Debevoise & Xxxxxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
If to Beneficiary, to:
JPMorgan Chase Bank, N.A.
000 Xxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
with a copy to:
Xxxxxx & Xxxxxxx LLP
000 Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000
Attn: Xxxxxxxx Xxxxxx
Telephone: 000-000-0000
Telecopy: 000-000-0000
If to the Trustee, to:
Attention: Xxxxxxx xxx Xxxxxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
No notice, request or demand to or upon the Grantor, Beneficiary or the Trustee
shall be effective until received. Grantor shall be conclusively deemed to have
received any notice, request or demand if such notice, request or demand is sent
by courier service and delivery thereof is confirmed by the courier, if it is
sent by fax and receipt thereof is confirmed orally, if it is sent by certified
mail or if it is served by any manner of service of process permitted by law.
Notices and other communications to Grantor or Trustee hereunder may be
delivered or furnished by electronic communications pursuant to procedures
approved by the Beneficiary. Approval of such procedures may be limited to
particular notices or communications.
8.2 COVENANTS RUNNING WITH THE LAND. All Obligations contained in this Deed of
Trust are intended by Grantor, Trustee and Beneficiary to be, and shall be
construed as, covenants running with the Mortgaged Property. As used herein,
"Grantor" shall refer to the party named in the first paragraph of this Deed of
Trust and to any subsequent owner of all or any portion of the Mortgaged
Property (without in any way implying that Beneficiary has or will consent to
any such conveyance or transfer of the Mortgaged Property). All persons or
entities who may have or acquire an interest in the Mortgaged Property shall be
deemed to have notice of, and be bound by, the terms of the Credit Agreement and
the other Loan Documents; however, no such party shall be entitled to any rights
thereunder without the prior written consent of Beneficiary.
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8.3. ATTORNEY-IN-FACT. Grantor hereby irrevocably appoints Beneficiary, and
its successors and assigns, as its attorney-in-fact, which agency is coupled
with an interest, (a) to execute and/or record any notices of completion,
cessation of labor or any other notices that Beneficiary deems appropriate to
protect Beneficiary's interest, if Grantor shall fail to do so within ten (10)
days after written request by Beneficiary, (b) upon the issuance of a deed
pursuant to the foreclosure of this Deed of Trust or the delivery of a deed in
lieu of foreclosure, to execute all instruments of assignment, conveyance or
further assurance with respect to the Leases, Rents, Personalty, Fixtures, Plans
and Property Agreements in favor of the grantee of any such deed and as may be
necessary or desirable for such purpose, (c) to prepare, execute and file or
record financing statements, continuation statements and applications for
registration necessary to create, perfect or preserve Beneficiary's security
interests and rights in or to any of the collateral, and (d) while any Event of
Default exists, to perform any obligation of Grantor hereunder; however: (1)
Beneficiary shall not under any circumstances be obligated to perform any
obligation of Grantor; (2) any out-of-pocket sums advanced by Beneficiary in
such performance shall be added to and included in the Obligations and shall
bear interest at the interest rate applicable to overdue Reimbursement
Obligations under Section 3.5(c) of the Credit Agreement; (3) Beneficiary as
such attorney-in-fact shall only be accountable for such funds as are actually
received by Beneficiary; and (4) Beneficiary shall not be liable to Grantor or
any other person or entity for any failure to take any action that it is
empowered to take under this Section.
8.4. SUCCESSORS AND ASSIGNS. This Deed of Trust shall be binding upon and
inure to the benefit of Beneficiary and Grantor and their respective successors
and assigns. Except to the extent expressly permitted by the Credit Agreement,
Grantor shall not, without the prior written consent of Beneficiary, assign any
rights, duties or obligations hereunder.
8.5. NO WAIVER. Any failure by Beneficiary to insist upon strict performance
of any of the terms, provisions or conditions of the Loan Documents shall not be
deemed to be a waiver of same, and Beneficiary shall have the right at any time
to insist upon strict performance of all of such terms, provisions and
conditions.
8.6. SUBROGATION. To the extent proceeds of the Loan have been used to
extinguish, extend or renew any indebtedness against the Mortgaged Property,
then Beneficiary shall be subrogated to all of the rights, liens and interests
existing against the Mortgaged Property and held by the holder of such
indebtedness and such former rights, liens and interests, if any, are not
waived, but are continued in full force and effect in favor of Beneficiary.
8.7. CREDIT AGREEMENT. If any conflict or inconsistency exists between this
Deed of Trust and the Credit Agreement, the Credit Agreement shall govern.
8.8. RELEASE. Any liens and security interest created by this Deed of Trust
shall be released in accordance with the terms and conditions set forth in the
Indenture. At the request and sole expense of Grantor following any such
release, Beneficiary shall execute and deliver such documents as Grantor may
reasonably request to evidence such release. Grantor may request Beneficiary
(but at no cost to Beneficiary) to assign this Deed of Trust to a beneficiary
designated by Grantor in accordance with the terms and conditions set forth in
the Indenture.
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8.9 WAIVER OF STAY, MORATORIUM AND SIMILAR RIGHTS. Grantor agrees, to the full
extent that it may lawfully do so, that it will not at any time insist upon or
plead or in any way take advantage of any appraisement, valuation, stay,
marshalling of assets, extension, redemption or moratorium law now or hereafter
in force and effect so as to prevent or hinder the enforcement of the provisions
of this Deed of Trust or the indebtedness secured hereby, or any agreement
between Grantor and Beneficiary or any rights or remedies of Beneficiary.
8.10. OBLIGATIONS OF GRANTOR, JOINT AND SEVERAL. If more than one person or
entity has executed this Deed of Trust as "Grantor," the obligations of all such
persons or entities hereunder shall be joint and several.
8.11. GOVERNING LAW. This Deed of Trust shall be governed by the laws of the
State in which the Land is located.
8.12. HEADINGS. The Article, Section and Subsection titles hereof are
inserted for convenience of reference only and shall in no way alter, modify or
define, or be used in construing, the text of such Articles, Sections or
Subsections.
8.13. ENTIRE AGREEMENT. This Deed of Trust and the other Loan Documents
embody the entire agreement and understanding between Beneficiary and Grantor
and supersede all prior agreements and understandings between such parties
relating to the subject matter hereof and thereof. Accordingly, the Loan
Documents may not be contradicted by evidence of prior, contemporaneous or
subsequent oral agreements of the parties. There are no unwritten oral
agreements between the parties.
8.14. FUTURE ADVANCES. This Deed of Trust secures future advances that will
be made by Lenders to the Grantor. Such future advances, with interest thereon,
shall be secured by this Deed of Trust unless the parties shall agree otherwise
in writing. The total principal amount of present Obligations secured by this
Deed of Trust is One Hundred Thirty Five Million and No/100 Dollars
($135,000,000). The outstanding amount that secures Obligations may decrease or
increase from time to time but the total unpaid principal balance so secured at
any one time shall not exceed One Hundred Thirty Five Million and No/100 Dollars
($135,000,000), plus interest thereon, and any and all disbursements made by
Beneficiary for the payment of taxes, special assessments or insurance on the
Property, with interest on such disbursements. In accordance with N.C. Gen.
Stat. 45-68(1)(c), the maximum period during which future obligations may be
incurred and secured by this Deed of Trust shall not extend beyond fifteen years
from the date hereof.
8.14.1 Disbursements or advances secured hereby, including, without limitation,
all present and future loan disbursements or advances made by the Lenders under
the Loan Documents, shall not be required to be evidenced by a "written
instrument or notation" as described in N.C. Gen. Stat. ss. 45-68(2), it being
the intent of the parties that the requirement of N.C. Gen. Stat. ss. 45-68(2)
for a "written instrument or notation" for each advance or disbursement shall
not be applicable to disbursements or advances under the Loan Documents.
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8.15 INTERCREDITOR AGREEMENT. Notwithstanding anything herein to the contrary,
the lien and security interest granted to Beneficiary pursuant to this Deed of
Trust and the exercise of any right or remedy by Beneficiary hereunder are
subject to the provisions of the Intercreditor Agreement. In the event of any
inconsistency or conflict between the terms and provisions of the Intercreditor
Agreement and this Deed of Trust, the terms and provisions of the Intercreditor
Agreement shall control.
IN WITNESS WHEREOF, this Deed of Trust has been duly executed and
delivered to Trustee by Grantor on the date of the acknowledgment attached
hereto.
DEL LABORATORIES, INC., a Delaware corporation
By________________________________
Name:___________________________
Title: ___________________________
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STATE OF _______________ )
) ss:
COUNTY OF _____________ )
I, _________________________, a Notary Public of the County and State
aforesaid, certify that ________________________ personally came before me this
day and acknowledged that he is _______________________ of Del Laboratories,
Inc., a Delaware corporation, and that he as _______________________, being
authorized to do so, executed the foregoing on behalf of the corporation.
Witness my hand and official stamp or seal, this day of December, 2005.
------------------------------
Notary Public
My commission expires:
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EXHIBIT A
[Legal Description]
(see attached)
