UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15 (d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): May 24, 2017
CADIZ INC.
(Exact name of Registrant as specified in charter)
Delaware | 0-12114 | 77-0313235 | ||
(State or other jurisdiction of incorporation) |
(Commission File Number) | (IRS Employer Identification Number) |
550 South Hope Street, Suite 2850
Los Angeles, California 90071
(Address of principal executive offices)
Registrant’s telephone number, including area code: (213) 271-1600
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Registrant under any of the following provisions (see General Instruction A.2 below).
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR240.14a-12) |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)). |
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13(e)-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ¨
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Item 1.01 | Entry into a Material Definitive Agreement. |
As previously reported in a Current Report on Form 8-K filed with the Securities and Exchange Commission (the “Commission”) on May 2, 2017 (the “Original Report”), on May 1, 2017, Cadiz Inc. (the “Company”) and Cadiz Real Estate LLC (collectively, the “Borrowers” or “Cadiz”), entered into a $60,000,000 Credit Agreement (the “Credit Agreement”) with Apollo Special Situations Fund, L.P. (“Apollo”, and together with the other lenders from time to time party to the Credit Agreement, the “Lenders”) and Wells Fargo Bank, National Association, as agent for the Lenders, pursuant to which the Lenders agreed to make secured term loans to the Borrowers (the “Loans”) in an aggregate principal amount of $60,000,000 (the “Apollo Loan Transaction”). The Apollo Loan Transaction closed on May 25, 2017 (the “Closing Date”). In conjunction with the closing of the Apollo Loan Transaction, the Company issued to Apollo a warrant to purchase an aggregate 357,500 shares of its common stock, subject to adjustment (the “Apollo Warrant”) and the Borrowers entered into a Security Agreement (the “Security Agreement”) and a Deed of Trust, Assignment of Leases and Rents, Security Agreement, Financing Statement and Fixture Filing (“Mortgage”) whereby the Borrowers granted, for the benefit and security of the Lenders, a security interest in all of the property owned or at any time acquired by the Borrowers, subject to certain exceptions, as collateral security for the payment and performance when due (whether at the stated maturity, by acceleration or otherwise) of the Borrower Obligations and each Loan Party’s Obligations, each as defined in the Security Agreement.
Prior to the Closing Date, on May 24, 2017, Cadiz entered into an Amended and Restated Payoff Agreement and Stipulation (the “Restated Payoff Agreement”) with its former lenders, MSD Master Credit Opportunity Fund, L.P. (“MSD”), Milfam II L.P. and WPI-Cadiz Farm CA, LLC (collectively, the “Former Lenders”) and Wells Fargo Bank, National Association, as administrative agent (the “Agent”), which Restated Payoff Agreement amended and restated in its entirety a Payoff Agreement and Stipulation entered into on May 23, 2017 among Cadiz, the Former Lenders and the Agent. The Restated Payoff Agreement provides for, among other things, the Former Lenders’ acceptance of prepayment of certain loans pursuant to the Amended and Restated Credit Agreement, dated as of October 30, 2013, by and among Cadiz, the Former Lenders and the Agent, as it was subsequently amended on November 23, 2015, February 8, 2016, March 4, 2016, April 28, 2016 and November 29, 2016 (the “Prior Credit Agreement”) and the submission to mediation or, if necessary, binding arbitration, of certain disputed matters concerning the Prior Credit Agreement and the prepayment of loans thereunder. Pursuant to the Restated Payoff Agreement, if the disputed matters concerning the Prior Credit Agreement are decided in favor of the Former Lenders, the Company will be required to issue to the Former Lenders registered shares of Common Stock (as defined in the warrants issued to the Former Lenders), together with any other payment that would be due to each Former Lender holding a warrant from the Company upon the cashless exercise of the applicable warrant for all Warrant Stock (as defined the warrants issued to the Former Lenders), as if the Initial Exercise Date and the Exercise Date (each as defined in the warrants issued to the Former Lenders) were the business day immediately following such arbitration determination. The warrants issued to the Former Lenders are described in and attached as exhibits to the Company’s Current Report on Form 8-K filed with the Commission on December 1, 2016.
The discussion above does not purport to be a complete description of the Apollo Warrant, the Security Agreement, the Mortgage or the Restated Payoff Agreement, and such discussion is qualified in its entirety by reference to the full text of each such document, each of which is attached as an exhibit to this Current Report and is incorporated herein by reference.
Item 2.03 | Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. |
To the extent required by this Item 2.03, the information included in Item 1.01 of this Current Report and the Original Report with respect to the Apollo Loan Transaction is incorporated herein by reference.
Item 8.01 | Other Events. |
On the Closing Date, the Company and Apollo closed the Apollo Loan Transaction that was described in the Original Report.
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Item 9.01 | Financial Statements and Exhibits |
Exhibits
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Dated: May 26, 2017
CADIZ INC. | ||
By: | /s/ Timothy Shaheen | |
Timothy Shaheen, | ||
Chief Financial Officer |
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EXHIBIT INDEX
5
Exhibit 4.1
WARRANT
to Purchase Common Stock of
Cadiz Inc.
Warrant No. B-1
Original Issue Date: May 25, 2017
THE SECURITIES REPRESENTED BY THIS CERTIFICATE MAY NOT BE SOLD OR TRANSFERRED UNLESS (I) A REGISTRATION STATEMENT COVERING SUCH SECURITIES IS EFFECTIVE UNDER THE SECURITIES ACT OR (II) THE TRANSACTION IS EXEMPT FROM REGISTRATION UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS.
Original Issue Date: May 25, 2017 | Warrant No. B-1 |
Warrant
to Purchase 357,500 Shares (Subject to Adjustment) of Common Stock of
Cadiz Inc.
THIS IS TO CERTIFY THAT Apollo Special Situations Fund, L.P. (“Investor”), or its registered assigns, is entitled, at any time prior to the Expiration Date to purchase from Cadiz Inc., a Delaware corporation (the “Company”), 357,500 shares (subject to adjustment as provided herein) of the common stock, par value $0.01 per share, of the Company at a purchase price of $14.94 per share (the initial “Exercise Price,” subject to adjustment as provided herein).
This Warrant was issued in connection with that certain Credit Agreement (the “Credit Agreement”), dated as of May 1, 2017 (the “Effective Date”), by and among the Company, as a borrower, Cadiz Real Estate LLC, as a borrower, Investor, as a lender, the other lenders party thereto, and Wells Fargo Bank, National Association, as agent (the “Agent”), and is subject to the terms thereof.
1. DEFINITIONS
As used in this Warrant, the following terms have the respective meanings set forth below, and to the extent such terms have the respective meaning set forth in the Credit Agreement, such terms shall have such meaning as set forth in the Credit Agreement, provided, however, that if such Credit Agreement is expired, terminated or otherwise discharged, such terms shall have the meaning set forth in the Credit Agreement immediately prior to such expiration, termination or discharge:
“10-Day VWAP” for any date of determination means the per share volume-weighted average price of Common Stock, as displayed under the heading “Bloomberg VWAP” on Bloomberg page CDZI <equity> VWAP (or its equivalent successor if such page is not available), from the scheduled open of trading until the scheduled close of trading of the primary trading session of the NASDAQ Global Market on each trading day during the 10 consecutive trading day period preceding (but not including) such date of determination (or if such volume-weighted average price is unavailable, the market value of one share of Common Stock during such period determined, using a volume-weighted average method, by a nationally recognized independent investment banking firm retained for this purpose by the Company). The VWAP will be determined without regard to after-hours trading or any other trading outside of the regular trading session trading hours.
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“Affiliate” of, or a Person “Affiliated” with, a specified Person means any other Person directly or indirectly controlling, controlled by, or under common control with, that Person. For the purposes of this definition, “control” (including, with correlative meanings, the terms “controlling,” “controlled by” and “under common control with”), as applied to any Person, means the possession, directly or indirectly, of the power (i) to vote 20% or more of the securities having ordinary voting power for the election of directors (or persons performing similar functions) of such Person, or (ii) to direct or cause the direction of the management and policies of that Person, whether by contract or otherwise.
“Agent” shall have the meaning set forth in the preamble to this Warrant.
“Aggregation Date” shall have the meaning set forth in Section 5.2 hereof.
“Applicable Rate” shall have the meaning ascribed to such term in the Credit Agreement.
“Appraisal Procedure” means the following procedure to determine the fair market value, as to any security, for purposes of the definition of “Fair Market Value“ or the fair market value, as to any other property (in either case, the “Valuation Amount“). The Valuation Amount shall be determined in good faith jointly by the Company and the Required Holders; provided, however, that if such parties are not able to agree on the Valuation Amount within a reasonable period of time (not to exceed 20 Business Days), the Valuation Amount shall be determined by the mutual agreement of two independent appraisers, one appointed by the Company and one appointed by the Required Holders, with each appointed within 10 days of the Appraisal Procedure having been first invoked by the Required Holders. The Company and the Required Holders shall submit their respective valuations and other relevant data to the appraisers, and the appraisers shall, within 20 days of the later of the two appraisers’ appointment dates, mutually agree to a determination of the Valuation Amount. If such appraisers cannot mutually agree on the Valuation Amount by such date, a third independent appraiser shall be chosen within 10 days of such date by the mutual consent of the first two appraisers. Such third appraiser shall make a determination of the Valuation Amount within 20 days of its appointment. If three appraisers shall have been appointed and made determinations of the Valuation Amount, then the average of the three Valuation Amounts shall be final and binding on the Company and the Required Holders as the final Valuation Amount, provided, however, that if the determination of one appraiser differs by an amount equal to more than twice that of the middle of the three appraisers’ Valuation Amounts (the “Outlier Appraiser”), then the determination of the Outlier Appraiser shall be excluded from determining the final Valuation Amount and the remaining two appraisers’ determinations of the Valuation Amount shall be averaged and such average shall be final and binding upon the Company and the Required Holders as the final Valuation Amount. The Company shall pay all of the fees and expenses incurred in conducting the Appraisal Procedure.
“beneficial owner” and “beneficially own” shall have the meaning set forth under Section 13(d) of the Exchange Act.
“Beneficial Ownership Limitation” has the meaning set forth in Section 5.1 hereof.
“Business Day” shall have the meaning ascribed to such term in the Credit Agreement.
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“Commission” means the Securities and Exchange Commission or any other federal agency then administering the Securities Act and other federal securities laws.
“Common Stock” means the common stock, par value $0.01 per share, of the Company as constituted on the Original Issue Date, and any capital stock into which such Common Stock may thereafter be changed, and shall also include (i) capital stock of the Company of any other class (regardless of how denominated) issued to the holders of shares of any Common Stock upon any reclassification thereof which is also not preferred as to dividends or liquidation over any other class of stock of the Company and which is not subject to redemption and (ii) shares of common stock of any successor or acquiring corporation received by or distributed to the holders of Common Stock of the Company in the circumstances contemplated by Section 4.6 hereof.
“Company” shall have the meaning set forth in the preamble to this Warrant.
“Credit Agreement” shall have the meaning set forth in the preamble to this Warrant.
“Delivery Notice” shall have the meaning set forth in Section 5.1(c) hereof.
“Designated Office” shall have the meaning set forth in Section 9 hereof.
“DOJ” shall have the meaning set forth in Section 6.4 hereof.
“DTC” shall have the meaning set forth in Section 2.1(b) hereof.
“DWAC” shall have the meaning set forth in Section 2.1(b) hereof.
“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission promulgated thereunder, all as the same shall be in effect at the time.
“Exercise Date” shall have the meaning set forth in Section 2.1(a) hereof.
“Exercise Notice” shall have the meaning set forth in Section 2.1(a) hereof.
“Exercise Price” means, in respect of a share of Warrant Stock at any date herein specified, the initial Exercise Price set forth in the preamble of this Warrant, as adjusted from time to time pursuant to Article 4 hereof.
“Expiration Date” means the fifth anniversary of the Original Issue Date, to be extended to allow for delayed exercise and delivery of any Warrant Stock in accordance with Section 5.1(c) hereof.
“Expiration Warrant Stock” shall have the meaning set forth in Section 5.1(c) hereof.
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“Fair Market Value” means (i) as to any Common Stock listed or quoted on a Trading Market, the 10-Day VWAP determined in respect of such primary Trading Market and (ii) as to any Common Stock not listed or quoted on a Trading Market or any other security, (A) the Ten Day Average of the average closing prices of such security’s sales on all domestic securities exchanges on which such security may at the time be listed, or (B) if there have been no sales on any such exchange such that the foregoing Ten Day Average cannot be calculated, the average of the highest bid and lowest asked prices on all such exchanges at the end of the Business Day immediately prior to the date that Fair Market Value is determined as of, or (C) if on any day such security is not listed any domestic securities exchange such that neither the foregoing Ten Day Average nor the foregoing bid-and-asked price average can be calculated, the average of the highest bid and lowest asked prices at the end of the Business Day immediately prior to the date that Fair Market Value is determined in the domestic over-the-counter market as reported by the National Association of Securities Dealers Automated Quotation System or similar organization (and in each such case excluding any trades that are not bona fide, arm’s length transactions). If neither the foregoing clause (i) nor clause (ii) is applicable, then (i) the “Fair Market Value” of such security as of an applicable determination date shall be as determined in accordance with the Appraisal Procedure.
“FTC” shall have the meaning set forth in Section 6.4 hereof.
“Governmental Authority” shall have the meaning set forth in the Credit Agreement.
“Holder“” means with respect to any Warrant or share of Warrant Stock, the Person in whose name the Warrant or Warrant Stock is registered on the books of the Company maintained for such purpose.
“Holder Group” shall have the meaning set forth in Section 5.1(d) hereof.
“HSR Act” shall have the meaning set forth in Section 6.4 hereof.
“Investor” shall have the meaning set forth in the preamble to this Warrant.
“Lien” means (i) any lien, mortgage, pledge, assignment, security interest, charge or encumbrance of any kind (including any agreement to give any of the foregoing, any conditional sale or other title retention agreement, and any lease in the nature thereof) and any option, trust or other preferential arrangement having the practical effect of any of the foregoing, and (ii) in the case of securities, any purchase option, call or similar right of a third party with respect to such securities.
“Maximum Percentage” shall have the meaning set forth in Section 5.1 hereof.
“Original Issue Date” means May 25, 2017, the date on which this Warrant was issued by the Company pursuant to the Credit Agreement.
“Outlier Appraiser” shall have the meaning set forth in Article 1 hereof.
“Outstanding” means, subject to Section 5.1(d) hereof, when used with reference to Common Stock, at any date as of which the number of shares thereof is to be determined, all issued and actually outstanding shares of Common Stock, except shares then owned or held by or for the account of the Company or any Subsidiary, and shall include all shares issuable in respect of outstanding scrip or any certificates representing fractional interests in shares of Common Stock.
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“Person” means and includes natural persons, corporations, limited partnerships, general partnerships, limited liability companies, limited liability partnerships, joint stock companies, joint ventures, associations, companies, trusts, banks, trust companies, land trusts, business trusts or other organizations, whether or not legal entities, and Governmental Authority.
“Reference Price” shall have the meaning set forth in Section 4.1 hereof.
“Related Issuances” shall have the meaning set forth in Section 5.2 hereof.
“Required Holders” means holders of outstanding Warrants representing more than 50% of the Warrant Stock issuable upon exercise of such outstanding Warrants.
“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations of the Commission promulgated thereunder, all as the same shall be in effect at the time.
“Stockholder Approval” means the approval by the stockholders of the Company for purposes of terminating the issuance cap in respect of shares of Common Stock set forth in Section 5.2 hereof.
“Subsidiary” means any corporation, association, trust, limited liability company, partnership, joint venture or other business association or entity (i) at least 50% of the Outstanding voting securities of which are at the time owned or controlled, directly or indirectly, by the Company; or (ii) with respect to which the Company possesses, directly or indirectly, the power to direct or cause the direction of the affairs or management of such Person.
“Ten Day Average” means, with respect to any prices and in connection with the calculation of Fair Market Value, the average of such prices over the ten consecutive Business Days ending on the Business Day immediately prior to the day as of which “Fair Market Value” is being determined.
“Trading Day” means any day that the primary Trading Market on which the Common Stock is listed or quoted is open for trading.
“Trading Market” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date in question: the NYSE MKT, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the New York Stock Exchange, OTCQB or OTCQX (or any successors to any of the foregoing).
“Transfer Agent” shall have the meaning set forth in Section 2.1(b) hereof.
“Valuation Amount” shall have the meaning set forth in Article 1 hereof.
“Warrant Price” means an amount equal to (i) the number of shares of Warrant Stock being purchased upon exercise of this Warrant pursuant to Section 2.1 hereof, multiplied by (ii) the Exercise Price.
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“Warrant” means this Warrant and all warrants issued upon transfer, division or combination of, or in substitution for, this Warrant, or any other like warrant subsequently issued to the Holder. All such foregoing warrants shall at all times be identical as to terms and conditions, except as to the number of shares of Warrant Stock for which they may be exercised and their date of issuance.
“Warrants” means this Warrant and all other warrants to purchase Common Stock, in the same form as this Warrant, issued to the lenders party to the Credit Agreement.
“Warrant Stock” means the shares of Common Stock issued, issuable or both (as the context may require) upon the exercise of this Warrant.
2. EXERCISE OF WARRANT
2.1 Manner of Exercise.
(a) From the Original Issue Date and at any time before 4:00 P.M., Eastern Standard Time, on the Expiration Date, the Holder of this Warrant may from time to time exercise this Warrant, on any Business Day, for all or any part of the number of shares of Warrant Stock (subject to adjustment as provided herein) purchasable hereunder. In order to exercise this Warrant, in whole or in part, the Holder shall (i) deliver to the Company at its Designated Office a written notice of the Holder’s election to exercise this Warrant (an “Exercise Notice“) substantially in the form attached to this Warrant as Annex A, which Exercise Notice shall be irrevocable and specify the number of shares of Warrant Stock to be purchased, together with this Warrant and (ii) pay to the Company the Warrant Price (in accordance with one of the methods specified in Section 2.1(a) hereof). The date on which such delivery and payment shall have taken place being hereinafter referred to as the “Exercise Date.” For the avoidance of doubt, any payment after the Original Issue Date of all remaining principal and interest outstanding under the Credit Agreement shall not affect the ability of the Holder to exercise this Warrant.
(b) Subject to Article 5 hereof, upon receipt by the Company of such Exercise Notice, surrender of this Warrant and payment of the Warrant Price (in accordance with Section 2.1(c) hereof), the Company shall cause its Transfer Agent to deliver the applicable shares of Warrant Stock, and the Company shall deliver or cause to be delivered cash in lieu of any fraction of a share, to the Holder and register such issued shares of Warrant Stock on the books of the Company as instructed by the Holder in the Exercise Notice. The issued shares of Warrant Stock will be delivered by crediting the account of the Holder’s prime broker (as specified by the Holder to the Company) with the Depository Trust Company (“DTC”) through its Deposit/Withdrawal At Custodian (“DWAC”) system, whereby the Holder’s prime broker shall initiate a DWAC transaction no later than 4:00 p.m. Eastern Standard Time on the third Trading Day following the Exercise Date using its DTC participant identification number, and released by Continental Stock Transfer & Trust Company, the Company’s transfer agent (or any successor transfer agent of the Company) (the “Transfer Agent”), at the Company’s direction. The Holder shall direct the broker-dealer at which the account or accounts to be credited with the issued shares of Warrant Stock are maintained, which broker/dealer shall be a DTC participant, to initiate a transaction through the DWAC system, instructing the Transfer Agent to credit such account or accounts with such shares of Warrant Stock. Such DWAC instruction shall indicate the settlement date for the deposit of such shares of Warrant Stock, which shall be the Exercise Date. The Company shall direct the Transfer Agent to credit the Holder’s account or accounts with such shares of Warrant Stock pursuant to the information contained in the DWAC instruction. This Warrant shall be deemed to have been exercised and such shares of Warrant Stock shall be deemed to have been issued, and the Holder or any other Person so designated to be named therein shall be deemed to have become a holder of record of such shares of Warrant Stock for all purposes, as of the Exercise Date.
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(c) Subject to Article 5 hereof, payment of the Warrant Price shall be made at the option of the Holder by one or more of the following methods: (i) by delivery of a certified or official bank check or by wire transfer of immediately available funds in the amount of such Warrant Price payable to the order of the Company, (ii) by instructing the Company to withhold a number of shares of Warrant Stock then issuable upon exercise of this Warrant with an aggregate Fair Market Value equal to such Warrant Price, (iii) by surrendering to the Company shares of Common Stock previously acquired by the Holder with an aggregate Fair Market Value equal to such Warrant Price, or (iv) any combination of the foregoing. In the event of any withholding of Warrant Stock or surrender of Common Stock pursuant to clause (ii), (iii) or (iv) of this Section 2.1(c) where the number of shares whose Fair Market Value is equal to the Warrant Price is not a whole number, the number of shares withheld by or surrendered to the Company shall be rounded up to the nearest whole share and the Company shall make a cash payment to the Holder based on the incremental fraction of a share being so withheld by or surrendered to the Company in an amount determined in accordance with Section 2.3 hereof. The Holder will receive fully paid and nonassessable shares of Warrant Stock upon any exercise of this Warrant.
(d) If this Warrant shall have been exercised in part, the Company shall, at the time of delivery of the shares of Warrant Stock being issued in accordance with Section 2.1(c) hereof, deliver to the Holder a new Warrant evidencing the rights of the Holder to purchase the unpurchased shares of Warrant Stock called for by this Warrant. Such new Warrant shall in all other respects be identical to this Warrant.
(e) Subject to Section 2.1(d) hereof, the Warrant delivered for exercise, and properly exercised by the Holder, in accordance with Sections 2.1(a)-(c) and Article 5 hereof shall be canceled by the Company.
2.2 Payment of Taxes. All shares of Warrant Stock issuable upon the exercise of this Warrant pursuant to the terms hereof shall be validly issued, fully paid and nonassessable, issued without violation of any preemptive or similar rights of any stockholder of the Company and free and clear of all Liens. The Company shall pay all expenses in connection with, and all taxes and other governmental charges that may be imposed with respect to, the issue or delivery thereof.
2.3 Fractional Shares. The Company shall not be required to issue a fractional share of Warrant Stock upon exercise of the Warrant. As to any fraction of a share that the Holder of the Warrant, the rights under which are exercised in the same transaction, would otherwise be entitled to purchase upon such exercise, the Company shall pay to the Holder an amount in cash equal to such fraction multiplied by the Fair Market Value of one share of Common Stock on the Exercise Date.
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3. TRANSFER, DIVISION AND COMBINATION
3.1 Transfer. Upon compliance with the provisions of this Section 3.1, each transfer of this Warrant and all rights hereunder, in whole or in part, shall be registered on the books of the Company to be maintained for such purpose, upon surrender of this Warrant at the Designated Office and compliance with the terms hereof, together with a written assignment of this Warrant in the form of Annex B attached hereto duly executed by the Holder or its agent or attorney and funds sufficient to pay any transfer taxes described in Section 2.2 hereof in connection with the making of such transfer. Upon such compliance, surrender and delivery and, if required, such payment, the Company shall execute and deliver a new Warrant in the name of the assignee or assignees and in the denominations specified in such instrument of assignment, and shall issue to the assignor a new Warrant evidencing the portion of this Warrant not so assigned and this Warrant shall promptly be cancelled.
3.2 Mutilation or Loss. Upon receipt by the Company from the Holder of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this Warrant and an indemnity reasonably satisfactory to it (it being understood that the written indemnification agreement of or affidavit of loss of the Holder shall be a sufficient indemnity) and, in case of mutilation, upon surrender and cancellation hereof, the Company will execute and deliver in lieu hereof a new Warrant of like tenor to the Holder; provided, however, that, in the case of mutilation, no indemnity shall be required if this Warrant in identifiable form is surrendered to the Company for cancellation.
3.3 Division and Combination. Subject to compliance with the applicable provisions of this Warrant, this Warrant may be divided or, following such division, combined with other Warrants upon presentation hereof at the Designated Office, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by the Holder or its agent or attorney. Subject to compliance with the applicable provisions of this Warrant as to any transfer which may be involved in such division or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided or combined in accordance with such notice.
3.4 Expenses. The Company shall prepare, issue and deliver at its own expense any new Warrant or Warrants required to be issued hereunder.
3.5 Maintenance of Books. The Company agrees to maintain, at the Designated Office, books for the registration and transfer of the Warrants.
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3.6 Registration of Warrant Stock. Any issuance of shares of Common Stock pursuant to Section 2.1 of this Warrant (collectively, the “Issuances”) shall be made pursuant to (i) an effective Registration Statement on Form S-3, No. 214318, including all amendments thereto, the exhibits and any schedules thereto, the documents otherwise deemed to be a part thereof or included therein or any immediately succeeding registration statement that is filed under the Securities Act on Form S-3 and immediately becomes effective (the “Registration Statement”) filed by the Company with the Commission in conformity with the Securities Act under the Rules and Regulations of the Commission, including the prospectus contained therein (the “Base Prospectus”) and (ii) a final prospectus supplement filed with the Commission and delivered to the Holder (a “Prospectus Supplement” and, together with the Base Prospectus, a “Prospectus”) containing amended and/or certain supplemental information regarding the Common Stock and terms of the Issuances. If the Company has filed one or more abbreviated registration statements to register additional shares of Common Stock pursuant to Rule 462(b) under the Rules and Regulations (each a “Rule 462(b) Registration Statement”), then any reference herein to the term “Registration Statement” shall also be deemed to include any such Rule 462(b) Registration Statement.
(i) The Company shall use reasonable best efforts to keep the Registration Statement effective until the earliest date as of which there are no remaining Issuances, and if, at any time from the date hereof, the Company is not eligible to issue any Common Stock or Warrants pursuant to the Registration Statement, the Company shall use reasonable best to efforts to file and make effective a replacement Registration Statement as soon as practicable. If the Registration Statement has been outstanding for at least three (3) years, at the end of the third year, the Company shall file a new Registration Statement covering Issuances, and if at any time when the Company is required to re-evaluate its eligibility to use Form S-3, the Company determines that it is not eligible to use Form S-3, the Company shall use its reasonable best efforts to refile the Registration Statement on Form S-1 if such form is available (or on such other form as may be available if Form S-1 is not available), and keep such registration statement effective during the period during which such registration statement is required to be otherwise kept effective under this Section 3.6(i).
(ii) For the avoidance of doubt, the Company acknowledges and agrees that no Issuances shall be made pursuant to any prospectus or prospectus supplement other than a Prospectus or any replacement Registration Statement required by this Section 3.6. The Company represents and warrants that, as of the Effective Date, the Securities Act and Rules and Regulations permit the Company to offer and issue $40,000,000 worth of shares of Common Stock pursuant to the Registration Statement, of which approximately $19,744,009 remains available. The Company represents and warrants that the Registration Statement complied when it became effective, complies on the Effective Date and shall comply on the Original Issue Date and on each Exercise Date and any later date upon which shares of Common Stock are received pursuant to this Agreement or a Warrant, in each case, in all material respects with the requirements of Form S-3 under the Securities Act. The Company represents and warrants that no order preventing or suspending the use of the Prospectus has been issued by the Commission, and no stop order suspending the effectiveness of the Registration Statement or any post-effective amendment thereto has been issued, and no proceedings for that purpose have been instituted or, to the Company’s knowledge, are threatened by the Commission. The Company represents and warrants that neither the Registration Statement nor the Prospectus shall, as of the Effective Date, the Original Issue Date or any Exercise Date or any later date on which shares of Common Stock are issued to the Holder under the Prospectus, contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading.
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(iii) The Company shall as soon as practicable notify the Holder of (A) the issuance by the Commission of any stop order suspending the effectiveness of any registration statement or the initiation of any proceedings for that purpose, (B) the receipt by the Company or its counsel of any notification with respect to the suspension of the qualification of shares of Common Stock or Warrants for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose, and (C) the effectiveness of each registration statement filed hereunder.
(iv) The Company shall use reasonable best efforts to cause the Warrant Stock when issued to be listed or quoted on each Trading Market on which the Common Stock is then listed or quoted.
(v) The Company shall use its reasonable best efforts to timely file its SEC Reports (or, if the Company is not required to file such reports, it will, upon the request of the Holder, make publicly available such information as necessary to permit sales pursuant to Rule 144 under the Securities Act), and the Company shall use reasonable best efforts to take such further action as the Holder may reasonably request, in each case to the extent required from time to time to enable the Holder to, if permitted by the terms of an applicable Warrant, sell such Warrant or its underlying Warrant Stock without registration under the Securities Act within the limitation of the exemptions provided by (A) Rule 144 under the Securities Act, as such rule may be amended from time to time, or (B) any successor rule or regulation hereafter adopted by the Commission. Upon the written request of the Holder, the Company shall deliver to the Holder a written statement that it has complied with such requirements.
4. ANTIDILUTION PROVISIONS
The number of shares of Warrant Stock for which this Warrant is exercisable and the Exercise Price shall be subject to adjustment from time to time as set forth in this Article 4.
4.1 Upon Issuance of Common Stock. If the Company shall, at any time or from time to time after the Original Issue Date, issue any shares of Common Stock, options to purchase or rights to subscribe for Common Stock, securities by their terms convertible into or exchangeable for Common Stock, or options to purchase or rights to subscribe for such convertible or exchangeable securities without consideration or for consideration per share less than the greater of (x) the Exercise Price in effect immediately prior to the issuance of such Common Stock or securities and (y) the Fair Market Value per share of the Common Stock immediately prior to such issuance (the greater of (x) and (y), the “Reference Price”), then such Exercise Price shall forthwith be lowered to a price equal to the price obtained by multiplying:
(i) the Exercise Price in effect immediately prior to the issuance of such Common Stock, options, rights or securities by
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(ii) a fraction of which (x) the numerator shall be the sum of (i) the number of shares of Common Stock Outstanding immediately prior to such issuance and (ii) the number of additional shares of Common Stock which the aggregate consideration for the number of shares of Common Stock so offered would purchase at the Reference Price and (y) the denominator shall be the number of shares of Common Stock Outstanding immediately after such issuance.
4.2 Upon Acquisition of Common Stock. If the Company or any Subsidiary shall, at any time or from time to time after the Original Issue Date, directly or indirectly, redeem, purchase or otherwise acquire any shares of Common Stock, options to purchase or rights to subscribe for Common Stock, securities by their terms convertible into or exchangeable for Common Stock, or options to purchase or rights to subscribe for such convertible or exchangeable securities, for a consideration per share (plus, in the case of such options, rights, or securities, the additional consideration required to be paid to the Company upon exercise, conversion or exchange) greater than the Fair Market Value per share of Common Stock immediately prior to the earlier of (x) the announcement of such event or (y) such event, then the Exercise Price shall forthwith be lowered to a price equal to the price obtained by multiplying:
(i) the Exercise Price in effect immediately prior to such event by
(ii) a fraction:
(A) the numerator of which is (1) the product of (a) the number of shares of Common Stock Outstanding and (b) the Fair Market Value per share of Common Stock, in each case immediately prior to such event, minus (2) the aggregate consideration paid by the Company in such event (plus, in the case of such options, rights, or convertible or exchangeable securities, the aggregate additional consideration required to be paid to the Company upon exercise, conversion or exchange), and
(B) the denominator of which is the product of (1) the number of shares of Common Stock Outstanding immediately after such event and (2) the Fair Market Value per share of Common Stock immediately prior to such event.
4.3 Provisions Applicable to Adjustments. For the purposes of any adjustment of the Exercise Price pursuant to Section 4.1 or 4.2 hereof, the following provisions shall be applicable:
(i) In the case of the issuance of Common Stock, options to purchase or rights to subscribe for Common Stock, securities by their terms convertible into or exchangeable for Common Stock, or options to purchase or rights to subscribe for such convertible or exchangeable securities for a consideration in whole or in part other than cash, the consideration other than cash shall be deemed to be the Fair Market Value of the non-cash consideration.
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(ii) In the case of the issuance of options to purchase or rights to subscribe for Common Stock, securities by their terms convertible into or exchangeable for Common Stock, or options to purchase or rights to subscribe for such convertible or exchangeable securities:
(A) the aggregate maximum number of shares of Common Stock that potentially may be deliverable upon exercise of such options to purchase or rights to subscribe for Common Stock at any time during the term thereof shall be deemed to have been issued at the time such options or rights were issued and for a consideration equal to the consideration (determined in the manner provided in subparagraph (i) above), if any, received by the Company upon the issuance of such options or rights plus the minimum purchase price provided in such options or rights for the Common Stock covered thereby;
(B) the aggregate maximum number of shares of Common Stock that potentially may be deliverable upon conversion of or in exchange for any such convertible or exchangeable securities or upon the exercise of options to purchase or rights to subscribe for such convertible or exchangeable securities and subsequent conversion or exchange thereof at any time during the term thereof shall be deemed to have been issued at the time such securities, options, or rights were issued and for a consideration equal to the consideration received by the Company for any such securities and related options or rights (excluding any cash received on account of accrued interest or accrued dividends), plus the additional consideration, if any, to be received by the Company upon the conversion or exchange of such securities or the exercise of any related options or rights (the consideration in each case to be determined in the manner provided in paragraph (i) above);
(C) on any increase in the number of shares or decrease in the effective exercise or conversion price of Common Stock deliverable upon exercise of any such options, rights or securities or conversions of or exchanges of such securities, including any change resulting from the anti-dilution provisions thereof, the Exercise Price shall forthwith be readjusted to such Exercise Price as would have been obtained had the adjustment made upon the issuance of such options, rights or securities not converted prior to such change or options or rights related to such securities not converted prior to such change been made upon the basis of such change; and
(D) no further adjustment of the Exercise Price adjusted upon the issuance of any such options, rights, convertible securities or exchangeable securities shall be made as a result of the actual issuance of Common Stock on the exercise of any such rights or options or any conversion or exchange of any such securities.
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4.4 Upon Stock Dividends, Subdivisions or Splits. If, at any time after the Original Issue Date, the number of shares of Common Stock Outstanding is increased by a stock dividend payable in shares of Common Stock or by a subdivision or split-up of shares of Common Stock, then, following the record date for the determination of holders of Common Stock entitled to receive such stock dividend, or to be affected by such subdivision or split-up, the Exercise Price shall be appropriately decreased by multiplying each price by a fraction, the numerator of which is the number of shares of Common Stock Outstanding immediately prior to such increase and the denominator of which is the number of shares of Common Stock Outstanding immediately after such increase in Outstanding shares.
4.5 Upon Combinations or Reverse Stock Splits. If, at any time after the Original Issue Date, the number of shares of Common Stock Outstanding is decreased by a combination or reverse stock split of the Outstanding shares of Common Stock into a smaller number of shares of Common Stock, then, following the record date to determine shares affected by such combination or reverse stock split, the Exercise Price shall be appropriately increased by multiplying each price by a fraction, the numerator of which is the number of shares of Common Stock Outstanding immediately prior to such decrease and the denominator of which is the number of shares of Common Stock Outstanding immediately after such decrease in Outstanding shares.
4.6 Upon Reclassifications, Reorganizations, Consolidations, Mergers or Dispositions of Assets. In the event of any capital reorganization of the Company, any reclassification of the capital stock of the Company (other than a change in par value or from par value to no par value or from no par value to par value or as a result of a stock dividend or subdivision, stock-split, reverse stock-split or combination of shares), any consolidation or merger of the Company with or into another Person (where the Company is not the surviving Person or where there is a change in or distribution with respect to the Common Stock) or sale, transfer or other disposition of all or substantially all of the Company’s property, assets or business to another Person, each Warrant shall after such reorganization, reclassification, consolidation, merger or disposition of assets be exercisable for the kind and number of shares of stock or other securities or property of the Company or of the successor Person (if other than the Company) resulting from such reorganization, reclassification, consolidation, merger or disposition of assets, if any, to which the holder of the number of shares of Common Stock deliverable (immediately prior to the time of such reorganization, reclassification, consolidation, merger or disposition of assets) upon exercise of such Warrant would have been entitled upon such reorganization, reclassification, consolidation, merger or disposition of assets (without taking into account any limitations or restrictions on the exercisability of this Warrant); and, in such case, appropriate adjustment (in form and substance satisfactory to the Holder) shall be made with respect to the Holder’s rights under this Warrant to insure that the provisions of Article 4 hereof shall thereafter be applicable, as nearly as possible, to this Warrant in relation to any shares of stock, securities or assets thereafter acquirable upon exercise of this Warrant. The Company shall not effect any such reorganization, reclassification, consolidation, merger or disposition of assets unless, prior to the consummation thereof, the successor Person (if other than the Company) resulting from such reorganization, reclassification, consolidation, merger or disposition of assets, shall assume, by written instrument, (i) the obligation to deliver to the Holders of the Warrant such shares of stock, securities or assets, which, in accordance with the foregoing provisions of this Section 4.6, the Holders shall be entitled to receive upon such conversion and (ii) the obligations of the Company pursuant to the provisions of Section 3.6. The provisions of this Section 4.6 shall similarly apply to successive reorganizations, reclassifications, consolidations, mergers or dispositions of assets.
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4.7 Other Anti-Dilution Provisions. If the Company has issued or issues any securities of the Company to a financial institution, lender, other credit provider, leasing company or other lessor in connection with the provisions of any financing or lending agreements, containing provisions (including, without limitation, anti-dilution and registration rights) which are more favorable than those set forth herein, the Company will make such provisions (or any more favorable portion thereof) available to the Holder and will enter into amendments necessary to confer such rights on the Holder. Notwithstanding the foregoing, any adjustment to the Exercise Price or number of shares of Warrant Stock shall be made only pursuant to and in accordance with Section 4 of this Warrant.
4.8 Appraisal Procedure. In any case in which the provisions of this Article 4 shall necessitate that the Appraisal Procedure be utilized for purposes of determining an adjustment to the Exercise Price, the Company may defer, until the completion of the Appraisal Procedure and the determination of the adjustment, (i) issuing to the Holder of any Warrant exercised after the date of the event that requires the adjustment and before completion of the Appraisal Procedure and the determination of the adjustment, the shares of capital stock issuable upon such exercise by reason of the adjustment required by such event and issuing to the Holder only the shares of capital stock issuable upon such exercise before giving effect to such adjustment and (ii) paying to the Holder any amount in cash in lieu of a fractional share of capital stock pursuant to Section 2.3 above; provided, however, that the Company shall deliver to the Holder an appropriate instrument or due bills evidencing the Holder’s right to receive such additional shares or such cash.
4.9 Adjustment of Number of Shares Purchasable. Upon any adjustment of the Exercise Price as provided in Section 4.1, 4.2, 4.4, 4.5 and 4.6, the Holders of the Warrants shall thereafter be entitled to purchase upon the exercise thereof, at the Exercise Price resulting from such adjustment, the number of shares of Warrant Stock (calculated to the nearest 1/100th of a share) obtained by multiplying the Exercise Price in effect immediately prior to such adjustment by the number of shares of Warrant Stock issuable on the exercise hereof immediately prior to such adjustment and dividing the product thereof by the Exercise Price resulting from such adjustment.
4.10 Increase of Number of Shares Purchasable. After giving effect to all other provisions in this Article 4 other than this Section 4.10, the number of shares of Warrant Stock purchasable upon exercise of this Warrant shall be increased when the Exercise Price is adjusted to an amount below the then-existing par value of the Warrant Stock, including successive adjustments to the Exercise Price to an amount further below the then-existing par value. The number of additional shares purchasable upon exercise of this Warrant shall be equal to the number obtained by dividing:
(i) The product of (A) the number of shares purchasable upon exercise of the Warrant before application of this Section 4.10 and (B) the difference between the then-existing par value per share of Warrant Stock minus the adjusted Exercise Price, by
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(ii) The difference between the Fair Market Value of the Common Stock on the Exercise Date minus the then-existing par value per share of Warrant Stock.
Concurrently with the foregoing adjustment to the number of additional shares purchasable upon exercise of this Warrant, the Exercise Price shall be adjusted to be the then-existing par value of the Warrant Stock.
4.11 Form of Warrants. Irrespective of any adjustments of the number of shares of Warrant Stock purchasable or of the Exercise Price, the Warrant theretofore or thereafter issued may continue to express the same price and number and kind of shares as are stated in the Warrant issued on the Original Issue Date.
4.12 Changes in Securities. Notwithstanding any provision in this Article 4 to the contrary and without limitation to any other provision contained in this Article 4, in the event any securities of the Company are amended, modified or otherwise altered by operation of this Article 4’s terms or otherwise in any manner whatsoever (including through the anti-dilution provisions thereof) that results in (i) the reduction of the effective exercise, conversion or exchange price of such securities payable upon the exercise for, or conversion or exchange into, Common Stock or other securities exercisable for, or convertible or exchangeable into, Common Stock and/or (ii) such securities becoming exercisable for, or convertible or exchangeable into (A) more shares or dollar amount of such securities which are, in turn exercisable for, or convertible or exchangeable into, Common Stock, or (B) more shares of Common Stock, then such amendment, modification or other alteration shall be treated for purposes of Article 4 as if the securities which have been amended, modified or altered have been terminated and new securities have been issued with the amended or modified terms. The Company shall make all necessary adjustments (including successive adjustments if required) to the Exercise Price in accordance with this Article 4, but in no event shall the Exercise Price be greater than it was immediately prior to the application of this Section 4.12 to the amendment, modification or alteration in question.
4.13 Maximum Exercise Price. Except as provided in Section 4.5 above, at no time shall the Exercise Price per share of Warrant Stock exceed the amount set forth in the preamble of this Warrant.
4.14 Exceptions. Notwithstanding anything to the contrary, Article 4 hereof shall not apply to (i) (A) the issuance and exercise of options to purchase shares of Common Stock and (B) the issuance of shares of Common Stock, in each case of the foregoing clause (A) and (B), as made to eligible recipients pursuant to any equity incentive plan duly adopted by the board of directors of the Company in the ordinary course of business, or (ii) any issuance of shares of Common Stock upon conversion of the Company’s convertible debt securities outstanding as of the Effective Date.
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4.15 Notice of Adjustment of Exercise Price. Whenever the number of shares of Common Stock for which this Warrant is exercisable or the Exercise Price is adjusted as provided under Article 4 hereof:
(i) the Company shall compute the adjusted Exercise Price in accordance with this Article 4 and shall prepare a certificate signed by the treasurer or chief financial officer of the Company setting forth the adjusted Exercise Price and showing in reasonable detail the facts upon which such adjustment is based, and such certificate shall forthwith be filed at the Designated Office; and
(ii) a notice stating that the Exercise Price has been adjusted and setting forth the adjusted Exercise Price shall forthwith be prepared by the Company, and as soon as practicable after it is prepared, such notice shall be mailed by the Company at its expense to the Holder at its last address as it shall appear in the warrant register. If the Board of Directors of the Company makes any determination of Fair Market Value for purposes of determining such proposed adjustment, then, within thirty (30) days of the Holder’s receipt of such notice, the Holder shall have the right to use the Appraisal Procedure to determine Fair Market Value with respect to the entire proposed adjustment.
4.16 Independent Application. Except as otherwise provided herein, all sections of this Article 4 are intended to operate independently of one another (but without duplication). If an event occurs that requires the application of more than one section of this Article 4, all applicable sections shall be given independent effect without duplication.
5. BENEFICIAL OWNERSHIP LIMITS; ISSUANCE CAP
5.1 Beneficial Ownership Limitation.
(a) Notwithstanding anything to the contrary contained herein, the Holder shall not receive shares of Warrant Stock upon exercise of the Warrant to the extent (but only to the extent) that such exercise or receipt would cause the Holder Group to become, directly or indirectly, a beneficial owner of a number of shares of Common Stock that exceeds the Maximum Percentage of Common Stock Outstanding as of the Exercise Date (the “Beneficial Ownership Limitation“). The Beneficial Ownership Limitation (i) may be increased or decreased, in the Holder’s sole discretion, upon 61 days’ written notice to the Company by the Holder, provided, however, that in no event shall the Holder increase such Beneficial Ownership Limitation to raise the Maximum Percentage in excess of 19.99% as of any date of shares of Common Stock Outstanding from the date hereof through the Expiration Date and (ii) shall automatically be increased to a Maximum Percentage of 19.99% on the date that is 15 days prior to the Expiration Date.
(b) At the time of delivery of any Exercise Notice, the Holder shall notify the Company if, and only if, a Holder Group would beneficially own a number of shares of Common Stock in excess of the Beneficial Ownership Limitation upon giving effect to such Exercise Notice. For the avoidance of doubt, upon any failure by the Holder to deliver such notice, any subsequent purported delivery in such instance of Warrant Stock shall be void and have no effect pursuant to Section 5.1(c) hereof.
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(c) Any purported delivery of Warrant Stock pursuant to Section 2.1(b) hereof, and any purported payment by the Holder of the Warrant Price pursuant to Section 2.1(a) and 2.1(c) hereof, in connection with the exercise of the Warrant shall be void and have no effect to the extent (but only to the extent) that such delivery would violate the Beneficial Ownership Limitation. If any delivery of Warrant Stock owed to the Holder following exercise of the Warrant is not made, in whole or in part, as a result of the Beneficial Ownership Limitation, the Company’s obligation to make such delivery shall not be extinguished and the Company shall deliver such Warrant Stock as promptly as practicable after the Holder gives written notice to the Company that such delivery would not violate the Beneficial Ownership Limitation (the “Delivery Notice”), provided, however, that (i) the Holder shall be deemed to have exercised this Warrant in respect of any such delayed Warrant Stock (other than at the Expiration Date) as of the date of the applicable Delivery Notice and (ii) for the avoidance of doubt, Article 4 hereof and Article 10 hereof shall remain in full force and effect for such period of delay, and provided, further, however, that at the Expiration Date and in accordance with the deemed Exercise Notice under Section 2.1(a) hereof, if, without giving effect to the Beneficial Ownership Limitation, the Warrant would be exercisable for any Warrant Stock, (i) the Holder shall be entitled to receive from the Company any such remaining Warrant Stock under the terms of this Warrant until such time as the Beneficial Ownership Limitation would not prohibit such delivery (such Warrant Stock at the Expiration Date, the “Expiration Warrant Stock”), (ii) the Holder shall be deemed to have exercised this Warrant in respect of all such Expiration Warrant Stock as of the date of the Holder’s receipt from the Company of the Expiration Warrant Stock (which exercise shall be subject to Article 4 hereof but not be subject to Sections 4.1 through 4.3 hereof) and (iii) for the avoidance of doubt, Article 10 hereof shall remain in full force and effect for the period until the delivery of the Expiration Warrant Stock.
(d) For purposes of this Section 5.1, (i) the term “Maximum Percentage“ shall mean 4.99%; provided, however, that if at any time after the date hereof the Holder Group beneficially owns in excess of 4.99% of the Outstanding Common Stock (excluding any Common Stock that could be acquired by exercise of this Warrant), then the Maximum Percentage shall automatically increase to 9.99% so long as any Holder Group owns in excess of 4.99% of such Common Stock (and shall, for the avoidance of doubt, automatically decrease to 4.99% upon the time when no Holder Group beneficially owns in excess of 4.99% of such Outstanding Common Stock); and (ii) the term “Holder Group“ shall mean any group in respect of Common Stock, where “group” has the meaning established under Section 13(d) of the Exchange Act and the rules promulgated thereunder, if the Holder or any other Person having beneficial ownership of Common Stock beneficially owned by the Holder is a member of such group. In determining the number of shares of Common Stock Outstanding for purposes of this Section 5.1 and the number of shares that the Holder may at any time acquire pursuant to the Beneficial Ownership Limitation and the other terms of this Section 5.1, the Holder shall give effect to the last sentence of Rule 13d-3(d)(1)(i) as promulgated under the Exchange Act, and the Holder may rely on the number of outstanding shares of Common Stock as reflected in (x) the Company’s most recent Annual Report on Form 10-K or Quarterly Report on Form 10-Q filed with the Commission, as the case may be, (y) a more recent public announcement by the Company or (z) a more recent notice by the Company or its transfer agent to the Holder setting forth the number of shares of Common Stock then outstanding. Upon written or oral request of the Holder, the Company shall, within two (2) Business Days of such request, confirm orally and in writing to the Holder the number of shares of Common Stock then Outstanding. The provisions of this Section 5.1 shall be construed, corrected and implemented in a manner so as to effectuate the intended Beneficial Ownership Limitation.
5.2 Issuance Cap. Unless Stockholder Approval has been previously obtained, in the event that any issuance of Warrant Stock upon the exercise of this Warrant would, together with any other issuance of shares of Common Stock by the Company to any holder of any Warrant that would be aggregated with such proposed issuance under this Warrant for determining whether such issuances collectively would require approval by a vote of Company stockholders under the applicable listing rules of the Nasdaq Global Market, any successor stock exchange operated by the NASDAQ Stock Market LLC or any successor thereto (such other issuances the “Related Issuances“), exceed 19.99% of the Common Stock Outstanding on November 29, 2016 (the “Aggregation Date”), the Holder shall receive only a number of shares of Common Stock, rounded down to the nearest whole number, equal to (A) the maximum number of shares of Common Stock which could be issued to the Holder and any other recipients of any then-proposed Related Issuances in the aggregate without the Related Issuances exceeding 19.99% of the Common Stock Outstanding on the Aggregation Date multiplied by a ratio equal to (B) (1) the number of shares of Common Stock that would be otherwise received by the Holder under this Warrant divided by (2) the number of all of the shares of Common Stock that would be otherwise received by the Holder under this Warrant and the recipients of any then-proposed Related Issuances in the aggregate. To the extent the Holder is entitled to receive from the Company a number of shares of Warrant Stock reduced by this Section 5.2, the Company shall pay to the Holder, in satisfaction of the Company’s obligation to deliver such Warrant Stock, a cash amount equivalent to the Fair Market Value, determined as of the Exercise Date, of the number of shares of Warrant Stock by which such exercise was reduced within three (3) Business Days of the Exercise Date.
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6. NO IMPAIRMENT; REGULATORY COMPLIANCE AND COOPERATION
6.1 No Impairment. The Company shall not by any action, including, without limitation, amending its charter documents or through any reorganization, reclassification, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other similar voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary or appropriate to protect the rights of the Holder against impairment. Without limiting the generality of the foregoing, the Company shall take all such action as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable shares of Warrant Stock upon the exercise of this Warrant, free and clear of all Liens, and shall use its best efforts to obtain all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof as may be necessary to enable the Company to perform its obligations under this Warrant. The Company shall not take any action, enter into any transaction or suffer to exist any event, action or state of facts that would cause the Exercise Price to be adjusted below the then existing par value of Common Stock (unless the Common Stock is changed to capital stock with no par value); provided, however, that nothing herein will prevent the operation of any other provision of this Warrant, including the anti-dilution provisions of Article 4 hereof.
6.2 No Dilution. If any event shall occur as to which the provisions of Article 4 hereof are not strictly applicable but the failure to make any adjustment would adversely affect the purchase rights represented by the Warrant in accordance with the essential intent and principles of such Article (including, without limitation, the issuance of securities other than Common Stock which have the right to participate in distributions to the holders of Common Stock, the granting of “phantom stock” rights or “stock appreciation rights”), then, in each such case, the Company shall, upon the request of any Holder, appoint an investment banking firm of recognized national standing, or any other financial expert that does not (or whose directors, officers, employees, Affiliates or stockholders do not) have a direct or material indirect financial interest in the Company or any of its Subsidiaries, who has not been, and, at the time it is called upon to give independent financial advice to the Company, is not (and none of its directors, officers, employees, Affiliates or stockholders are) a promoter, director or officer of the Company or any of its Subsidiaries, which shall give their opinion upon the adjustment, if any, on a basis consistent with the essential intent and principles established in Article 4 hereof, necessary to preserve, without dilution, the purchase rights, represented by this Warrant. Prior to such determination by such investment banking firm, the Company and the requesting Holder(s), respectively, shall specify the amount, if any, of the adjustment that such party has determined in good faith to be appropriate. The adjustment determined by the investment banking firm shall be within the range of the adjustments thus proposed by the parties, and the costs and fees of such investment banking firm shall be allocated proportionately between the Company, on one hand, and the Holder, on the other, based on the respective differences between the amount of the adjustment as determined by such investment banking firm and the amounts of such adjustment proposed by the Company and the Holder. Upon receipt of such opinion, the Company will promptly mail a copy thereof to the holders of the Warrants and shall make the adjustments described therein.
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6.3 Other Agreements. The Company is not a party to or bound in any manner under, and covenants that it will not enter into at any time after the date hereof, any agreement or contract (whether written or oral) with respect to any of its securities which prevents the Company from complying in any respect with the rights granted by the Company hereunder.
6.4 Antitrust Notification. If the Holder determines, in its sole judgment upon the advice of counsel, that an exercise of this Warrant pursuant to the terms hereof would be subject to the provisions of the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”), the Company shall file, within seven (7) Business Days after receiving notice from the Holder of the applicability of the HSR Act and a request to so file, with the United States Federal Trade Commission (the “FTC”) and the United States Department of Justice (the “DOJ”) the notification and report form and any supplemental information required to be filed by it pursuant to the HSR Act in connection with the exercise of this Warrant. Any such notification and report form and supplemental information will be in full compliance with the requirements of the HSR Act. The Company will furnish to the Holder promptly (but in no event more than five (5) business days) such information and assistance as such holder may reasonably request in connection with the preparation of any filing or submission required to be filed by the Holder under the HSR Act. The Company shall respond promptly after receiving any inquiries or requests for additional information from the FTC or the DOJ (and in no event more than three (3) business days after receipt of such inquiry or request). The Company shall keep the Holder apprised periodically and at the Holder's request of the status of any communications with, and any inquiries or requests for additional information from, the FTC or the DOJ. The Company shall bear all filing or other fees required to be paid by the Company under the HSR Act or any other applicable law in connection with such filings and all costs and expenses (including, without limitation, reasonable attorneys' fees and expenses) incurred by the Company in connection with the preparation of such filings and responses to inquiries or requests. The Company shall also bear 50% of all filing or other fees required to be paid by the Holder (or the “ultimate parent entity” of the Holder, if any) under the HSR Act or any other applicable law in connection with such filings and 50% of all costs and expenses (including, without limitation, reasonable attorneys' fees and expenses) incurred by the Holder in connection with the preparation of such filings and responses to inquiries or requests, and the Holder shall bear the remaining 50% of such fees, costs and expenses. In the event that this Section 6.4 is applicable to any exercise of this Warrant, the issuance to the Holder of the applicable Warrant Stock Shares, and the payment by the Holder of the Warrant Price therefor, shall be subject to the expiration or earlier termination of the waiting period under the HSR Act (with the Exercise Date being deemed to be the date immediately following the date of such expiration or early termination).
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7. RESERVATION AND AUTHORIZATION OF COMMON STOCK
7.1 Reservation. The Company shall at all times reserve and keep available for issuance upon the exercise of the Warrant such number of its authorized but unissued shares of Common Stock as will be required for issuance of the Warrant Stock. All shares of Warrant Stock issuable pursuant to the terms hereof, when issued upon exercise of this Warrant with payment therefor in accordance with the terms hereof, shall be duly and validly issued and fully paid and nonassessable, not subject to preemptive rights and shall be free and clear of all Liens. Before taking any action that would result in an adjustment in the number of shares of Warrant Stock for which this Warrant is exercisable or in the Exercise Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from any public regulatory body or bodies having jurisdiction over such action. If any shares of Warrant Stock required to be reserved for issuance upon exercise of the Warrant require registration or qualification with any Governmental Authority under any federal or state law (including the Securities Act and state securities laws) before such shares may be so issued, the Company will use its commercially reasonable efforts to register and qualify such shares as soon as practicable and at its expense.
7.2 Corporate Action. Before taking any action that would cause an adjustment reducing the Exercise Price below the then-par value (if any) of the shares of Warrant Stock deliverable upon exercise of the Warrant or that would cause the number of shares of Warrant Stock issuable upon exercise of the Warrant to exceed (when taken together with all other Outstanding shares of Common Stock) the number of shares of Common Stock that the Company is authorized to issue, the Company will take any corporate action that, in the opinion of its counsel, is necessary in order that the Company may validly and legally issue the full number of fully paid and nonassessable shares of Warrant Stock issuable upon exercise of the Warrant at such adjusted exercise price.
8. NOTICE OF CORPORATE ACTIONS; TAKING OF RECORD; TRANSFER BOOKS
8.1 Notices of Corporate Actions.
In case:
(a) the Company shall grant to the holders of its Common Stock rights or warrants to subscribe for or purchase any shares of capital stock of any class; or
(b) the Company shall declare to the holders of its Common Stock any dividend or distribution; or
(c) of any reclassification of the Common Stock (other than a subdivision or combination of the Outstanding shares of Common Stock), or of any consolidation, merger or share exchange to which the Company is a party and for which approval of any stockholders of the Company is required, or of the sale or transfer of all or substantially all of the assets of the Company; or
(d) of the voluntary or involuntary dissolution, liquidation or winding up of the Company;
(e) the Company or any Subsidiary shall commence a tender offer for all or a portion of the Outstanding shares of Common Stock (or shall amend any such tender offer to change the maximum number of shares being sought or the amount or type of consideration being offered therefor); or
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(f) the Company or any Subsidiary takes any action or any event or circumstance occurs that impacts the rights of a Holder set forth herein or in the Credit Agreement, as applicable;
then the Company shall cause to be filed at the Designated Office, and shall cause to be mailed to the Holder at its last address as it shall appear in the warrant register, at least 30 days prior to the applicable record, effective or expiration date hereinafter specified, a notice stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution or granting of rights or warrants, or, if a record is not to be taken, the date as of which the holders of Common Stock of record who will be entitled to such dividend, distribution, rights or warrants are to be determined, (y) the date on which such reclassification, consolidation, merger, share exchange, sale, transfer, dissolution, liquidation or winding up is expected to become effective, and the date as of which it is expected that holders of Common Stock of record shall be entitled to exchange their shares of Common Stock for securities, cash or other property deliverable upon such reclassification, consolidation, merger, share exchange, sale, transfer, dissolution, liquidation or winding up, or (z) the date on which such tender offer commenced, the date on which such tender offer is scheduled to expire unless extended, the consideration offered and the other material terms thereof (or the material terms of the amendment thereto). Such notice shall also set forth such facts with respect thereto as shall be reasonably necessary to indicate the effect of such action on the Exercise Price and the number and kind or class of shares or other securities or property which shall be deliverable or purchasable upon the occurrence of such action or deliverable upon exercise of the Warrants. Neither the failure to give any such notice nor any defect therein shall affect the legality or validity of any action described in clauses (a) through (e) of this Section 8.1.
8.2 Taking of Record. In the case of all dividends or other distributions by the Company to the holders of its Common Stock with respect to which any provision hereof refers to the taking of a record of such holders, the Company will in each such case take such a record and will take such record as of the close of business on a Business Day.
8.3 Closing of Transfer Books. The Company shall not at any time close its stock transfer books or warrant transfer books so as to result in preventing or delaying the exercise or transfer of any Warrant.
9. OFFICE OF THE COMPANY
9.1 As long as the Warrant remains outstanding, the Company shall maintain an office or agency, which may be the principal executive offices of the Company (the “Designated Office“), where the Warrant may be presented for exercise, registration of transfer, division or combination as provided in this Warrant. Such Designated Office shall initially be the office of the Company at 550 South Hope Street, Suite 2850, Los Angeles, California 90071. The Company may from time to time change the Designated Office to another office of the Company or its agent within the United States by notice given to any registered Holders at least ten (10) Business Days prior to the effective date of such change.
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10. DILUTION ADJUSTMENT
10.1 Dilution Adjustment.
(a) In the event that any dividends are declared or paid or any other distribution is made on or with respect to the Common Stock, the Holder as of the record date established by the Board of Directors of the Company for such dividend or distribution on the Common Stock shall be entitled to receive a fee (the “Dilution Adjustment”) in an amount (whether in the form of cash, securities or other property) equal to the amount (and in the form) of the dividends or distribution that such Holder would have received had the Warrant been exercised as of the date immediately prior to the record date for such dividend or distribution, such Dilution Adjustment to be payable on the same payment date established by the Board of Directors of the Company for the payment of such dividend or distribution; provided, however, that if the Company declares and pays a dividend or distribution on the Common Stock consisting in whole or in part of Common Stock, then no such Dilution Adjustment shall be payable in respect of the Warrant on account of the portion of such dividend or distribution on the Common Stock payable in Common Stock and in lieu thereof the applicable adjustment in Article 4 hereof shall apply. The record date for any such Dilution Adjustment shall be the record date for the applicable dividend or distribution on the Common Stock, and any such Dilution Adjustment shall be payable to the Persons in whose name the Warrant is registered at the close of business on the applicable record date.
(b) No dividend shall be paid or declared on any share of Common Stock (other than dividends payable in Common Stock for which an adjustment was made pursuant to Article 4 hereof), unless the Dilution Adjustment, payable in the same consideration and manner, is simultaneously paid or provided for, as the case may be, in respect of this Warrant in an amount determined as set forth in this Section 10.1. For purposes of this Warrant, the term “dividends” shall include any pro rata distribution by the Company, out of funds of the Company legally available therefor, of cash, property, securities (including, but not limited to, rights, warrants or options and/or securities in connection with a spin-off of the Company) or other property or assets to the holders of the Common Stock, whether or not paid out of capital, surplus or earnings other than liquidation.
(c) Prior to declaring any dividend or making any distribution on or with respect to shares of Common Stock, the Company shall take all prior corporate action necessary to authorize the issuance of any securities payable as the Dilution Adjustment in respect of the Warrant.
11. MISCELLANEOUS
11.1 No Implied Waivers. No failure or delay by any party in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The rights and remedies herein provided shall be cumulative and not exclusive of any rights or remedies provided by law.
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11.2 Notices. All notices, requests, consents and other communications required or permitted hereunder shall be in writing and shall be hand delivered or mailed postage prepaid by registered or certified mail or transmitted by facsimile transmission (with immediate telephonic confirmation thereafter) or transmitted by email:
(a) If to the Holder:
APOLLO MANAGEMENT HOLDINGS, L.P.
2000 Avenue of the Stars, Suite 510
Los Angeles, CA 90067
Attention:
Facsimile No.:
Telephone No.:
Email:
with a copy to (which shall not constitute notice):
Paul, Weiss, Rifkind, Wharton &
Garrison LLP
1285 Avenue of the Americas New York, NY 10019
Attention: Brian Kim and Tracey Zaccone
Facsimile No.: (212) 492-6675
Telephone No.: (212) 373-3780
Email: bkim@paulweiss.com and tzaccone@paulweiss.com
(b) If to the Company:
Cadiz Inc.
550 South Hope Street, Suite 2850
Los Angeles, California 90071
Attention: Chief Financial Officer
Facsimile No.: 213-271-1614
Email: tshaheen@cadizinc.com
with a copy to (which shall not constitute notice):
Mitchell Silberberg
& Knupp LLP
11377 W. Olympic Blvd.
Los Angeles, CA 90065
Facsimile No.: (310) 312-3100
Attention: Kevin Friedmann
Email: kxf@msk.com
or at such other address as the parties each may specify by written notice to the others, and each such notice, request, consent and other communication shall for all purposes of the Warrant be treated as being effective or having been given when delivered if delivered personally, upon receipt of facsimile confirmation if transmitted by facsimile, upon transmission of email if transmitted by email, or, if sent by mail, at the earlier of its receipt or 72 hours after the same has been deposited in a regularly maintained receptacle for the deposit of United States mail, addressed and postage prepaid as aforesaid.
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11.3 Indemnification. If the Company fails to make, when due, any payments provided for in this Warrant, the Company shall pay to the Holder (a) interest at the Applicable Rate on any amounts due and owing to such Holder and (b) such further amounts as shall be sufficient to cover any costs and expenses including, but not limited to, reasonable attorneys’ fees and expenses incurred by such Holder in collecting any amounts due hereunder. The Company shall indemnify, defend and hold harmless the Holder and the Holders of any Warrant Stock issued upon the exercise of this Warrant from and against any and all liability, loss, cost, damage, reasonable attorneys’ and accountants’ fees and expenses, court costs and all other out-of-pocket expenses incurred in connection with or arising from any default hereunder by the Company or the enforcement of its rights hereunder as against the Company. This indemnification provision shall be in addition to the rights of such Holder or Holders to bring an action against the Company for breach of contract based on such default hereunder.
11.4 Limitation of Liability. No provision hereof, in the absence of affirmative action by the Holder to purchase shares of Warrant Stock, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of such Holder to pay the Exercise Price for any Warrant Stock other than pursuant to an exercise of this Warrant or any liability as a stockholder of the Company, whether such liability is asserted by the Company or by creditors of the Company. The Holder shall not, by virtue hereof, be entitled to any rights of a stockholder of the Company and nothing contained in this Warrant shall be construed as conferring upon the Holder the right to vote or to consent or to receive notice as a stockholder in respect of meetings of stockholders for the election of directors of the Company or any other matters or any rights whatsoever as a stockholder of the Company.
11.5 Remedies. The Holder of the Warrant and/or Warrant Stock, in addition to being entitled to exercise its rights granted by law, including recovery of damages, shall be entitled to specific performance of its rights provided under this Warrant. The Company agrees that monetary damages would not be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees, in an action for specific performance, to waive the defense that a remedy at law would be adequate.
11.6 Successors and Assigns. This Warrant and the rights evidenced hereby shall inure to the benefit of and be binding upon the successors of the Company and the permitted successors and assigns of the Holder. The provisions of this Warrant are intended to be for the benefit of all Holders from time to time of this Warrant and to the extent applicable, all Holders of shares of Warrant Stock issued upon the exercise hereof (including transferees), and shall be enforceable by any such Holder.
11.7 Amendment. The prior written consent of the Company and the Required Holders shall be required for any change, waiver or amendment to this Warrant. Any change, waiver or amendment so approved shall be binding upon all existing and future holders of this Warrant and any other Warrants; provided, however, that no such change, waiver or amendment, as applied to any of the Warrants held by any particular holder of Warrants, shall, without the written consent of that particular holder, (i) disproportionately and materially adversely affect any rights under such particular holder’s Warrant (other than as reflected by the different number of shares of Warrant Stock issuable to such holder); or (ii) modify any of the provisions of, or impair the right of any holder of Warrants under, this Section 11.7. This Warrant cannot be changed, modified, discharged or terminated by oral agreement.
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11.8 Severability. Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Warrant.
11.9 Headings. The headings and other captions in this Warrant are for the convenience and reference only and shall not be used in interpreting, construing or enforcing any provision of this Warrant.
11.10 Governing Law. IN ALL RESPECTS, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, THIS WARRANT SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES AND ANY APPLICABLE LAWS OF THE UNITED STATES OF AMERICA.
11.11 Jurisdiction. Each of the Company and the Holder hereby irrevocably and unconditionally submits for itself and its property in any legal action or proceeding relating to this Warrant, or for recognition and enforcement of any judgment in respect thereof, to the exclusive general jurisdiction of the courts of the Supreme Court of the State of New York sitting in New York County, the courts of the United States for the Southern District of New York, and appellate courts from any thereof, consents that any such action or proceeding may be brought in such courts and waives any objection that it may now or hereafter have to the venue of any such action or proceeding in any such court or that such action or proceeding was brought in an inconvenient court and agrees not to plead or claim the same, agrees that service of process in any such action or proceeding may be effected by delivery of notice pursuant to Section 11.2 hereof and agrees that nothing herein shall affect the right to effect service of process in any other manner permitted by law.
11.12 Waiver of Jury Trial. EACH OF THE COMPANY AND THE HOLDER WAIVES ANY RIGHT TO TRIAL BY JURY ON ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION (A) ARISING UNDER THIS WARRANT OR (B) IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THIS WARRANT OR THE TRANSACTIONS RELATED HERETO, IN EACH CASE WHETHER SOUNDING IN CONTRACT OR TORT OR OTHERWISE. EACH OF THE COMPANY AND THE HOLDER AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS CLAUSE WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE COMPANY AND THE HOLDER TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY. EACH OF THE COMPANY AND THE HOLDER ACKNOWLEDGES THAT IT HAS HAD THE OPPORTUNITY TO CONSULT WITH COUNSEL REGARDING THIS SECTION 11.12, THAT IT FULLY UNDERSTANDS ITS TERMS, CONTENT AND EFFECT, AND THAT IT VOLUNTARILY AND KNOWINGLY AGREES TO THE TERMS OF THIS SECTION 11.12.
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11.13 Entire Agreement. This Warrant contains the entire agreement with respect to the subject matter hereof and supersedes and replaces all other prior agreements, written or oral, with respect to the subject matter hereof.
11.14 Originals. A signed copy of this Warrant delivered by facsimile, e-mail or other means of electronic transmission shall be deemed to have the same legal effect as delivery of an original copy of this Warrant.
[Signature Page Follows]
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IN WITNESS WHEREOF, the Company has caused this Warrant to be duly executed as of the Original Issue Date.
CADIZ INC. | |||
By: | /s/ Timothy J. Shaheen | ||
Name: | Timothy J. Shaheen | ||
Title: | Chief Financial Officer |
[Signature page]
ANNEX A TO THE WARRANT
EXERCISE NOTICE
[To be executed only upon exercise of Warrant]
The undersigned registered owner of this Warrant irrevocably exercises this Warrant for the purchase of ______ shares of Common Stock of Cadiz Inc. and herewith makes payment therefor in __________, all at the price and on the terms and conditions specified in this Warrant and requests that the shares of Common Stock hereby purchased (and any securities or other property issuable upon such exercise) be issued in the name of, and delivered to, as applicable, _________________, whose address is __________________________________ ____________________________________________________________________, and, if such shares of Common Stock shall not include all of the shares of Common Stock issuable as provided in this Warrant, that a new Warrant of like tenor and date for the balance of the shares of Common Stock issuable hereunder be delivered to the undersigned.
TO DELETE THE FOLLOWING BRACKETED LANGUAGE IF INAPPLICABLE AT EXERCISE DATE:[The undersigned hereby notifies Cadiz Inc. that a Holder Group would beneficially own a number of shares of Common Stock in excess of the Beneficial Ownership Limitation set forth in this Warrant upon giving effect to this Exercise Notice. Pursuant to such limitation, Cadiz Inc. shall give effect to this Exercise Notice in accordance with such limitation as of [INSERT DATE], the date hereof].
(Name of Registered Owner) | |
(Signature of Registered Owner) | |
(Street Address) | |
(City) (State) (Zip Code) |
NOTICE: | The signature on this Exercise Notice must correspond with the name as written upon the face of the within Warrant in every particular, without alteration or enlargement or any change whatsoever. |
ANNEX B TO THE WARRANT
ASSIGNMENT FORM
FOR VALUE RECEIVED the undersigned registered owner of this Warrant hereby assigns unto the assignee named below all of the rights of the undersigned under this Warrant, with respect to the number of shares of Common Stock set forth below:
Name and Address of Assignee |
No. of Shares of Common Stock | |
and does hereby irrevocably constitute and appoint ________ _____________ attorney-in-fact to register such transfer onto the books of Cadiz Inc. maintained for the purpose, with full power of substitution in the premises.
Dated: | Print Name: |
Signature: | Witness |
NOTICE: | The signature on this assignment must correspond with the name as written upon the face of the within Warrant in every particular, without alteration or enlargement or any change whatsoever. |
Exhibit 5.1
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Mitchell Silberberg & Knupp llp A Law Partnership Including Professional Corporations |
|
May 25, 2017
Cadiz Inc.
550 South Hope Street, Suite 2850
Los Angeles, California 90071
Gentlemen:
This opinion is furnished to Cadiz Inc. (the “Company”) in connection with a Registration Statement on Form S-3 (Registration No. 333-214318, the “Registration Statement”) filed with the Securities and Exchange Commission (the “Commission”) on October 28, 2016 and declared effective by the Commission on November 14, 2016, and the prospectus included therein and the related prospectus supplement filed with the Commission on May 3, 2017.
In connection with the execution by the Company, together with certain lenders, of the $60,000,000 Credit Agreement among Cadiz Inc. and Cadiz Real Estate LLC as Borrowers, the several lenders from time-to-time parties thereto (the “Lenders”) and Wells Fargo Bank, N.A., as Agent dated as of May 1, 2017 (the “Credit Agreement”), the Company has issued to the Lenders, pursuant to the Credit Agreement and in accordance with the respective pro rata interests of the loans made by the Lenders pursuant to the Credit Agreement, warrants to purchase an aggregate 357,500 shares of the Company’s common stock (the “Warrants”).
We have examined and relied upon such records, documents, certificates and other instruments as in our judgment are necessary or appropriate to enable us to render the opinions expressed below.
The opinion expressed herein is limited to the applicable provisions of the General Corporation Law of the State of Delaware and the federal securities laws of the United States as currently in effect, and no opinion is expressed with respect to any other laws or any effect that such other laws may have on the opinion expressed herein. This opinion is limited to the specific issues addressed herein, and no opinion may be inferred or implied beyond that expressly stated herein. This opinion speaks only as of the date hereof and we assume no obligation to revise or supplement this opinion.
We assume the legal capacity of all natural persons, the genuineness of all signatures appearing on the documents examined by us, the authenticity and completeness of all documents submitted to us as originals, and the conformity to the originals of all documents submitted to us as certified, notarized, conformed or photostatic copies, or facsimiles. With respect to all matters of fact we have relied entirely upon the representations of the parties set forth in the documents we reviewed, and representations and certifications of officers of the Company we may obtain from the Company, and have assumed, with your permission and without independent inquiry or investigation, the accuracy of those representations and certificates.
When an opinion or other statement set forth herein is given to our knowledge, with reference to matters of which we are aware or that are known to us, or with a similar qualification, the relevant knowledge or awareness is limited to the actual knowledge or awareness of the individual lawyers in this firm who have participated directly in the specific transactions to which this opinion letter relates.
Subject to the limitations set forth herein, we have made such examination of law as we have deemed necessary for the purposes of this opinion letter. We express no opinion as to the “blue sky” laws and regulations of any jurisdiction.
Based and relying upon and subject to the foregoing, we are of the opinion that (i) the Warrants are validly issued, fully paid and nonassessable and the Warrants will be binding obligations of the Company under the law of the State of Delaware and (ii) assuming the Warrants are exercised in accordance with their terms, the common stock issued upon exercise of the Warrants will be validly issued, fully paid and nonassessable.
We hereby consent to the filing of this opinion as an exhibit to the Registration Statement. In giving this consent, we do not admit that we are within the category of persons whose consent is required under Section 7 of the Securities Act of 1933, as amended, or the Rules and Regulations of the Commission promulgated thereunder.
Very truly yours, | |
/s/ MITCHELL SILBERBERG & KNUPP LLP |
11377
West Olympic Boulevard, Los Angeles, California 90064-1683 Phone: (310) 312-2000 Fax: (310) 312-3100 Website: WWW.MSK.COM |
Exhibit 10.1
EXECUTION VERSION
AMENDED AND RESTATED PAYOFF AGREEMENT AND STIPULATION
This Amended and Restated Payoff Agreement and Stipulation (this “Agreement”) is entered into as of May 24, 2017, by Cadiz Inc., a Delaware corporation (“Cadiz Inc.”), Cadiz Real Estate LLC, a Delaware limited liability company (collectively with Cadiz Inc., “Cadiz”), MSD Credit Opportunity Master Fund, L.P. (“MSD”), Milfam II L.P. (“Milfam”), WPI-Cadiz Farm CA, LLC (“WPI”; collectively with Milfam and MSD, the “Lenders”) and Wells Fargo Bank, National Association, as administrative agent (the “Agent”). Cadiz, the Lenders, and the Agent may be referred to herein as the Parties, or individually, as a Party.
RECITALS
A. | Cadiz, as borrowers, the Lenders and the Agent are party to that certain Amended and Restated Credit Agreement, dated as of October 30, 2013 (the “Credit Agreement”; capitalized terms used but not defined herein having the meanings set forth therein), as amended by the First Amendment dated as of November 23, 2015, the Second Amendment dated as of February 8, 2016, the Third Amendment dated as of March 4, 2016, the Fourth Amendment dated as of April 28, 2016, and the Fifth Amendment (the “Fifth Amendment”) dated as of November 29, 2016 (the “Fifth Amendment Effective Date”). | |
B. | It was a condition precedent to the effectiveness of the Fifth Amendment that Cadiz Inc. issue to each Lender a Warrant to Purchase Common Stock of Cadiz Inc. (collectively, the “Warrants”). Cadiz Inc. issued such Warrants on the Fifth Amendment Effective Date. Each Warrant provides that Cadiz Inc. will be required to issue Warrant Stock (as defined in each Warrant) to the applicable Lender holder beginning on the “Initial Exercise Date” of such Warrant, which Initial Exercise Date would occur, in each case, if any principal or interest amounts are outstanding under the Credit Agreement on the date that is the one hundred and eightieth (180th) day following the Fifth Amendment Effective Date. The parties hereto stipulate that the one hundred and eightieth (180th) day following the Fifth Amendment Effective Date is May 28, 2017. | |
C. | Section 2.3 of the Credit Agreement is entitled “Optional Prepayments.” Section 2.3(a) states “At any time and from time to time, the Borrowers may prepay the Secured Term Loans, in whole or in part (in increments of not less than $100,000), for an amount equal to the Accreted Loan Value of the amount being prepaid through the day prior to the date of such prepayment plus the Applicable Prepayment Premium, upon at least thirty (30) Business Days’ notice to the Agent, which notice shall specify the principal amount of the Secured Term Loans to be prepaid, the total prepayment amount and the date on which such prepayment will be delivered to the Agent. It shall not be a condition to the delivery by the Borrowers of such prepayment notice that the Borrowers have sufficient available funds to make such prepayment. The Agent shall deliver any prepayment notice it receives from the Borrower under this Section 2.3(a) to the Lenders within three (3) Business Days of receipt of such notice.” Section 2.3(c) states that “the Borrowers shall not have any right to prepay the Loans other than as set forth in this Section 2.3 and as required by Section 2.6 (Mandatory Prepayments).” |
D. | All Parties agree that Cadiz Inc. delivered written notice of prepayment; however, there is a disagreement as to the date of that notice. Cadiz Inc. asserts that it delivered proper notice in March 2017 and again on May 1, 2017 (the “May Notice”) and that notice was sufficient to comply with Credit Agreement Section 2.3(a) and allow prepayment within 180 days of the Fifth Amendment Effective Date. Lenders assert that notice of prepayment was not provided until the May Notice was delivered to the Agent and that any notice of prepayment must be delivered 30 Business Days prior to the scheduled prepayment date (the “30 Business Day Notice Period”). All parties agree that the May Notice specified June 15, 2017 as the date of prepayment (the “Scheduled Discharge Date”). |
E. | Cadiz Inc. asserts (i) that it provided proper and timely notice of prepayment more than 30 Business Days in advance of the anticipated prepayment date; (ii) that the Lenders are not entitled to enforce Section 2.3(a); (iii) that the Lenders have waived the requirements of Section 2.3(a); and therefore, (iv) Cadiz is entitled to prepay amounts due under the Credit Agreement without any further turnover of shares or Warrants, or any other payment or penalty. Cadiz Inc. further asserts that under the circumstances, turnover of shares or Warrants, and any other payments beyond the prepayment amounts would violate the Credit Agreement and constitute an unfair and unenforceable windfall and penalty. |
F. | The Lenders assert that they are entitled to the enforcement of Section 2.3(a) and that the Lenders have not waived any requirement of Section 2.3(a), including but not limited to the 30 Business Day Notice Period. The Lenders assert that the Lenders have no obligation to waive any such requirements. The Lenders assert that such a waiver would deprive the Lenders of the interest of the Secured Term Loans to be paid up to the Scheduled Discharge Date and, because May 28, 2017 occurs before the Scheduled Discharge Date, the Warrant Stock that would be available to them under the Warrants. |
SECTION I
CONDITIONAL AGREEMENT OF PREPAYMENT
1. | The Lenders hereby agree to accept on or before May 26, 2017, prepayment in full of the Secured Term Loans, by wire transfer of immediately available funds, an amount equal to all Obligations arising under, out of, or in connection with the Credit Agreement, any other Loan Document or any other document made, delivered or given in connection therewith, including, without limitation the Accreted Loan Value of the Secured Term Loans calculated as if such Secured Term Loans remained outstanding as of the Scheduled Discharge Date along with interest that would have accrued through the Scheduled Discharge Date and all other reimbursement obligations, fees, indemnities, costs, expenses (including all reasonable fees, charges and disbursements of counsel to the Agent, MSD’s reasonable legal fees incurred in connection with this Agreement, not to exceed $115,000.00, and all legal fees to any other Lender that are required to be paid by the Borrower pursuant to the Credit Agreement (all such amounts, the “Payoff Amount”)), provided, however, that notwithstanding the foregoing, Cadiz’s indemnification and reimbursement obligations, and other obligations that, by their express terms, survive termination of the Credit Agreement, in each case shall continue to survive notwithstanding receipt by the Lenders of the Payoff Amount. Notwithstanding the foregoing, absent agreement by the Parties, the determination of whether the Warrants may be exercised by the Lenders shall be made pursuant to the arbitration to be conducted in accordance with Section 2 herein. |
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SECTION II
SUBMISSION TO MEDIATION AND ARBITRATION
2. | The Lenders’ acceptance of the Payoff Amount is given as an accommodation. Each party hereto hereby acknowledges and agrees that the parties will submit the following questions to mediation and, if necessary, binding arbitration: |
(a) | Whether the 30 Business Day Notice Period in Section 2.3 of the Credit Agreement is enforceable by the Lenders and entitles the Lenders to refuse prepayment prior to the expiration of such 30 Business Day Notice Period. | |
(b) | Whether the Lenders may not enforce the 30 Business Day Notice Period due to waiver, estoppel, laches, implied agreement, or such similar legal basis. | |
3. | The Parties agree to conduct the mediation within 60 days of the effective date of this agreement. Notwithstanding the foregoing, either MSD or Cadiz Inc. may terminate the agreement to mediate or the mediation process upon written notice to the other. |
4. | In the event of a termination of the agreement to mediate or the mediation process, any remaining disputes shall be resolved exclusively by binding arbitration. This agreement is entered into pursuant to the Federal Arbitration Act. The arbitration shall be governed by the law of New York and the applicable rules of the American Arbitration Association (“AAA”) and shall be conducted before AAA. The exclusive venue for the arbitration shall be New York, New York. The arbitration shall be heard by a panel of three (3) arbitrators. All awards must be issued by means of a written, reasoned opinion and must be by agreement of a majority of the arbitrators. The award shall be final and binding and may be confirmed by entry of a judgment in a state or federal court in New York, New York. |
SECTION III
AGREEMENT OF THE PARTIES
5. | Unless otherwise agreed by the applicable parties, in the event that it is determined in arbitration that (a) the 30 Business Day Notice Period is enforceable by the Lenders and entitles the Lenders to refuse prepayment before the expiration of the 30 Business Day Notice Period, and (b) the Lenders did not waive such 30 Business Day Notice Period prior to the date hereof, then notwithstanding any provision of any Warrant to the contrary, then the foregoing arbitration determination shall require Cadiz Inc. to deliver, and Cadiz Inc. shall deliver, to such Lender holder, on the Business Day immediately following such arbitration determination, registered shares of Common Stock (as defined in the Warrants) that would be deliverable by Cadiz Inc., together with any other payment that would be due to such Lender holder from Cadiz Inc., upon a cashless exercise of the applicable Warrant pursuant to Section 2.1(c)(ii) thereof for all Warrant Stock (as defined in such Warrant) as if the Initial Exercise Date and the Exercise Date of such Warrant were the Business Day immediately following such arbitration determination. Such arbitration determination shall also require Cadiz Inc. to comply, and Cadiz Inc. shall comply, with all other provisions of the Warrant, including but not limited to Section 3.6 thereof. Such arbitration determination shall include components of one of the following, as may be applicable: 1) an increase to the number of registered shares of Common Stock to Lenders (which shall be issued on the same basis as the Warrant Stock under the Warrant but without an exercise price) to compensate for losses attributable to the delay in the issuance of such shares, due to a decrease in the value of the shares through the date of issuance; and 2) credit or offset to Cadiz’s obligations and the amount of shares Lender would be entitled to, due to an increase in the value of the shares through the date of issuance. With respect to the foregoing, the arbitrators will assume that each Lender holder would have exercised such Lender holder’s Warrant, and sold the shares issued in respect thereof, in each case on May 30, 2017. For the avoidance of doubt, in the event Cadiz Inc. is unable to deliver registered shares of Common Stock to satisfy any required issuances under this Section 5, Cadiz Inc. shall be required to deliver the difference between the aggregate warrant exercise price ($3,575.00) and the value of shares of Common Stock to be issued in cash by wire transfer to the account designated by each Lender. In the event that Cadiz Inc. fails to comply with this paragraph 5, in addition to all remedies, all protections and rights of each Lender holder shall remain in place as if the Warrants had become exercisable, and had not been exercised, until such registered shares of Common Stock are issued, including, for the avoidance of doubt, any increases in the number of shares of Common Stock issued thereunder due to any anti-dilution protection contained in Article 4 of each Warrant. This paragraph shall operate to prevent the expiration or termination of any Warrant in accordance with its terms, including for the avoidance of doubt, due to there being no principal or interest outstanding on the 180 day following the Fifth Amendment Effective Date. |
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6. | Any arbitration determination shall include an award of indemnities, costs and expenses payable pursuant to Section 9.5 of the Credit Agreement and Section 11.3 of each Warrant. |
SECTION IV
COOPERATION BY LENDERS
7. | The Lenders agree, and shall instruct the Agent, to fully cooperate with Cadiz in connection with the prepayment contemplated under Section I, including but not limited to causing the May 5, 2017 letter from MSD to the Agent to be rescinded, and to execute such documents and take other actions as may be necessary to effectuate the intent of this Agreement, including but not limited the delivery of a deed or deeds of reconveyance. |
SECTION V
GENERAL PROVISIONS
8. | Nothing contained herein shall be deemed or construed as a waiver, admission, concession, res judicata, collateral estoppel, or otherwise relevant in connection with any subsequent action, cause of action, or proceeding relating to the Credit Agreement or the Warrants and any respective claims related thereto. |
9. | Each of the parties further agrees to execute documents, instruments, or conveyances of any kind in mutually agreed (such agreement not to be unreasonably withheld) form and substance which may be necessary or advisable to carry out any of the transactions contemplated hereunder and to cooperate with the other party in connection with the foregoing. Each of the parties agrees that any settlement or any other agreement to be made between Cadiz and any Lender hereunder or with respect to any Warrant shall not disproportionately and adversely treat any Warrant of any other Lender (or any rights or remedies of such Lender hereunder or thereunder) compared to any Warrant (or any such rights and remedies) of any other Lender provided that any Lender may settle any or all of its claims with Cadiz so long as such settlement does not prejudice the rights and claims of any other Lender. For the avoidance of doubt, no Lender is acting as an agent or fiduciary for any other Lender hereunder. |
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10. | This Agreement may not be modified other than by a signed writing executed by each of the Parties. |
11. | This Agreement may be signed in counterpart originals as if signed in one original document. |
12. | This Agreement shall be governed by and construed under the laws of the State of New York, without giving effect to its principles or rules of conflict of laws to the extent such principles or rules are not mandatorily applicable by statute and would require or permit the application of the laws of another jurisdiction. |
13. | Nothing in this Agreement shall be construed in favor or to the detriment of any Party in connection with the mediation or arbitration. |
14. | This Agreement and all rights and obligations hereunder shall automatically terminate if the Payoff Amount is not received by the Lenders on or before May 26, 2017. |
15. | This Agreement shall amend and restate the Payoff Agreement and Stipulation entered into by the Parties on May 23, 2017 (the “Existing Agreement”) in its entirety. The rights and obligations of the Parties under the Existing Agreement shall be subsumed within, and be governed by, this Agreement. |
[Signature pages follow]
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IN WITNESS WHEREOF, the undersigned has set his or her name to this Amended and Restated Payoff Agreement and Stipulation as of the date set forth above.
CADIZ INC., as a Borrower | ||
By: | /s/ Timothy J. Shaheen | |
Name: Timothy J. Shaheen | ||
Title: Chief Financial Officer | ||
CADIZ REAL ESTATE LLC, as a Borrower | ||
By: | /s/ Timothy J. Shaheen | |
Name: Timothy J. Shaheen | ||
Title: Chief Financial Officer |
[Amended and Restated Payoff Agreement and Stipulation]
MSD
CREDIT OPPORTUNITY MASTER FUND, L.P., as a Lender | ||
By: | /s/ Marcello Liguori | |
Name: Marcello Liguori | ||
Title: Managing Director |
[Amended and Restated Payoff Agreement and Stipulation]
MILFAM II L.P., as a Lender | ||
By: | MILFAM LLC | |
Its: | General Partner |
By: | /s/ Lloyd I. Miller III | |
Name: Lloyd I. Miller III | ||
Title: Manager |
[Amended and Restated Payoff Agreement and Stipulation]
WPI-CADIZ FARM CA, LLC, as a Lender | ||
By: | /s/ Marc Robert | |
Name: Marc Robert | ||
Title: CDO |
[Amended and Restated Payoff Agreement and Stipulation]
Exhibit 10.2
Execution Version
SECURITY AGREEMENT
made by
CADIZ
INC.
and
CADIZ REAL ESTATE LLC,
as Loan Parties,
in favor of
WELLS
FARGO BANK, NATIONAL ASSOCIATION,
as Agent
Dated as of May 25, 2017
TABLE OF CONTENTS
Page |
SECTION 1
DEFINED TERMS
1.1 | Definitions | 1 |
1.2 | Other Definitional Provisions | 4 |
SECTION 2
GRANT OF SECURITY INTEREST
SECTION 3
REPRESENTATIONS AND WARRANTIES
3.1 | Title; No Other Liens | 5 |
3.2 | Perfected First Priority Liens | 5 |
3.3 | Jurisdiction of Organization; Chief Executive Office | 6 |
3.4 | Real Property | 6 |
3.5 | Inventory and Equipment | 6 |
3.6 | Farm Products | 6 |
3.7 | Investment Property | 6 |
3.8 | Receivables | 6 |
3.9 | Intellectual Property | 6 |
3.10 | Deposit Accounts and Securities Accounts | 7 |
3.11 | Letter-of-Credit Rights | 7 |
3.12 | Commercial Tort Claims | 7 |
SECTION 4
COVENANTS
4.1 | Delivery of Instruments, Certificated Securities and Chattel Paper | 7 |
4.2 | Payment of Obligations | 7 |
4.3 | Maintenance of Perfected Security Interest; Further Documentation | 8 |
4.4 | Changes in Locations, Name, etc. | 8 |
4.5 | Notices | 9 |
4.6 | Investment Property | 9 |
4.7 | Receivables | 10 |
4.8 | Deposit Accounts and Securities Accounts | 10 |
4.9 | Letters of Credit | 10 |
4.10 | Equipment | 10 |
4.11 | General Intangibles | 11 |
4.12 | Commercial Tort Claims | 11 |
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Page |
SECTION 5
REMEDIAL PROVISIONS
5.1 | Certain Matters Relating to Receivables | 11 |
5.2 | Communications with Obligors; Loan Parties Remain Liable | 11 |
5.3 | Pledged Stock | 12 |
5.4 | Proceeds to Be Turned Over to Agent | 13 |
5.5 | Application of Proceeds | 13 |
5.6 | Code and Other Remedies | 14 |
5.7 | Deficiency | 14 |
SECTION 6
MISCELLANEOUS
6.1 | Amendments in Writing | 15 |
6.2 | Notices | 15 |
6.3 | No Waiver by Course of Conduct; Cumulative Remedies | 15 |
6.4 | Enforcement Expenses; Indemnification | 15 |
6.5 | Successors and Assigns | 15 |
6.6 | Set-off | 16 |
6.7 | Counterparts | 16 |
6.8 | Severability | 16 |
6.9 | Section Headings | 16 |
6.10 | Integration | 16 |
6.11 | Governing Law | 16 |
6.12 | Submission to Jurisdiction; Waivers | 16 |
6.13 | Acknowledgments | 17 |
6.14 | Releases | 17 |
6.15 | Waiver of Jury Trial | 18 |
6.16 | The Agent | 18 |
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SCHEDULES
Schedule 1 | Notice Addresses of Loan Parties |
Schedule 2 | Description of Investment Property |
Schedule 3 | Filings and Other Actions Required to Perfect Security Interests |
Schedule 4 | Jurisdiction of Organization, Organizational Number, FEIN and Chief Executive Office |
Schedule 5 | Owned and Leased Property |
Schedule 6 | Locations of Inventory and Equipment |
Schedule 7 | Intellectual Property |
Schedule 8 | Deposit Accounts and Securities Accounts |
Schedule 9 | Letter of Credit Rights |
Schedule 10 | Commercial Tort Claims |
SECURITY AGREEMENT
SECURITY AGREEMENT, dated as of May 25, 2017, made by Cadiz Inc., a Delaware corporation (“Parent”), and Cadiz Real Estate LLC, a Delaware limited liability company (“CRE”) (together with any other entity that may become a party hereto as provided herein, the “Loan Parties”), in favor of Wells Fargo Bank, National Association, as administrative agent and collateral agent (in such capacity, the “Agent”), on behalf of the Lenders holding Secured Term Loans under the Credit Agreement, dated as of May 1, 2017 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), among Parent and CRE, as borrowers (together, the “Borrower”), the lenders party thereto (the “Lenders”) and the Agent.
W I T N E S S E T H:
WHEREAS, it is a condition precedent to the Credit Agreement that the Loan Parties shall have executed and delivered this Agreement to the Agent;
NOW, THEREFORE, in consideration of the premises hereunder, and to induce the Agent and the Lenders to enter into the Credit Agreement, each Loan Party hereby agrees with the Agent as follows:
Section 1
DEFINED TERMS
1.1 Definitions. Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement, and the following terms are used herein as defined in the New York UCC: Accounts, Certificated Security, Chattel Paper, Commercial Tort Claims, Contracts, Control, Documents, Equipment, Farm Products, General Intangibles, Goods, Instruments, Inventory, Letter-of-Credit Rights and Supporting Obligations. The following terms shall have the following meanings:
(a) “Agreement”: this Security Agreement, as the same may be amended, restated, supplemented or otherwise modified from time to time.
(b) “Borrower Obligations”: the collective reference to the Obligations, as defined in the Credit Agreement, with respect only to the Secured Term Loans outstanding thereunder and to the Lenders holding Secured Term Loans.
(c) “Collateral”: as defined in Section 2.
(d) “Collateral Account”: any collateral account established by the Agent as provided in Section 5.1 or 5.4.
(e) “Convertible Note Indentures”: means (i) that certain Indenture, dated as of March 5, 2013, between Parent and U.S. Bank, National Association (as successor to The Bank of New York Mellon Trust Company, N.A.), as trustee, as amended by that certain First Supplemental Indenture dated as of October 30, 2013, and that certain Second Supplemental Indenture dated as November 23, 2015, and as may be further amended, restated, supplemented or otherwise modified from time to time, and (ii) that certain Indenture, dated as of December 10, 2015, between Parent and U.S. Bank, National Association, as trustee, as amended by that certain First Supplemental Indenture dated as of April 28, 2016, and as may be further amended, restated, supplemented or otherwise modified from time to time.
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(f) “Copyright Licenses”: any written agreement naming any Loan Party as licensor or licensee (including, without limitation, those listed in Schedule 7), granting any right under any Copyright, including, without limitation, the grant of rights to manufacture, distribute, exploit and sell materials derived from any Copyright.
(g) “Copyrights”: (i) all copyrights arising under the laws of the United States, whether registered or unregistered and whether published or unpublished (including, without limitation, those listed in Schedule 7), all registrations and recordings thereof, and all applications in connection therewith, including, without limitation, all registrations, recordings and applications in the United States Copyright Office, and (ii) the right to obtain all renewals thereof.
(h) “Deposit Account”: as such term is defined in the New York UCC, including the deposit accounts listed on Schedule 8.
(i) “Intellectual Property”: the collective reference to all rights, priorities and privileges relating to intellectual property arising under United States laws, including, without limitation, the Copyrights, the Copyright Licenses, the Patents, the Patent Licenses, the Trademarks and the Trademark Licenses.
(j) “Intercompany Note”: any promissory note evidencing loans made by any Loan Party to another Loan Party.
(k) “Investment Property”: the collective reference to (i) all “Investment Property” as such term is defined in Section 9-102(a)(49) of the New York UCC and (ii) in any event, all Pledged Notes and all Pledged Stock.
(l) “Issuers”: the collective reference to each issuer of any Investment Property.
(m) “New York UCC”: the Uniform Commercial Code as from time to time in effect in the State of New York.
(n) “Loan Party Obligations”: with respect to any Loan Party, all obligations and liabilities of such Loan Party with respect only to the Secured Term Loans outstanding thereunder, to the Lenders holding Secured Term Loans and to the Agent which may arise under or in connection with this Agreement, any other Loan Document to which such Loan Party is a party, in each case whether on account of guarantee obligations, reimbursement obligations, fees, indemnities, costs, expenses or otherwise (including, without limitation, all fees and disbursements of counsel to the Agent that are required to be paid by such Loan Party pursuant to the terms of this Agreement, any other Loan Document).
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(o) “Obligations”: (i) in the case of the Borrower, the Borrower Obligations, and (ii) in the case of each other Loan Party, its Loan Party Obligations.
(p) “Patent License”: all agreements, whether written or oral, providing for the grant by or to any Loan Party of any right to manufacture, use or sell any invention covered in whole or in part by a Patent, including, without limitation, any of the foregoing referred to in Schedule 7.
(q) “Patents”: (i) all letters patent of the United States, all reissues and extensions thereof and all goodwill associated therewith, including, without limitation, any of the foregoing referred to in Schedule 7, (ii) all applications for letters patent of the United States, continuations and continuations-in-part thereof, including, without limitation, any of the foregoing referred to in Schedule 7, and (iii) all rights to obtain any reissues or extensions of the foregoing.
(r) “Pledged Notes”: all promissory notes listed on Schedule 2 and all Intercompany Notes at any time issued to any Loan Party and all other promissory notes issued to or held by any Loan Party.
(s) “Pledged Stock”: (i) the shares of Capital Stock listed on Schedule 2 and (ii) any other shares, stock certificates, options, interests or rights of any nature whatsoever in respect of the Capital Stock of any Person that may be issued or granted to, or directly held by, any Loan Party while this Agreement is in effect.
(t) “Proceeds”: all “Proceeds” as such term is defined in Section 9-102(a)(64) of the New York UCC and, in any event, shall include, without limitation, all dividends or other income from the Investment Property, collections thereon or distributions or payments with respect thereto.
(u) “Receivable”: any right to payment for goods sold or leased or for services rendered, whether or not such right is evidenced by an Instrument or Chattel Paper and whether or not it has been earned by performance (including, without limitation, any Account).
(v) “Securities Act”: the Securities Act of 1933, as amended.
(w) “Trademark License”: any agreement, whether written or oral, providing for the grant by or to any Loan Party of any right to use any Trademark, including, without limitation, any of the foregoing referred to in Schedule 7.
(x) “Trademarks”: (i) all trademarks, trade names, corporate names, company names, business names, fictitious business names, trade styles, service marks, logos and other source or business identifiers, and all goodwill associated therewith, now existing or hereafter adopted or acquired, all registrations and recordings thereof, and all applications in connection therewith, whether in the United States Patent and Trademark Office or in any similar office or agency of the United States or any State thereof, or otherwise, and all common-law rights related thereto, including, without limitation, any of the foregoing referred to in Schedule 7, and (ii) the right to obtain all renewals thereof.
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1.2 Other Definitional Provisions. (a) The words “hereof,” “herein,” “hereto” and “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement, and Section and Schedule references are to this Agreement unless otherwise specified.
(b) The meanings given to terms defined herein shall be equally applicable to both the singular and plural forms of such terms.
(c) Where the context requires, terms relating to the Collateral or any part thereof, when used in relation to a Loan Party, shall refer to such Loan Party’s Collateral or the relevant part thereof.
Section 2
GRANT OF SECURITY INTEREST
Each Loan Party hereby grants to the Agent, for its benefit and on behalf of, and for the benefit of, the Lenders holding Secured Term Loans, a security interest in, all of the following property now owned or at any time hereafter acquired by such Loan Party or in which such Loan Party now has or at any time in the future may acquire any right, title or interest (collectively, the “Collateral”), as collateral security for the prompt and complete payment and performance when due (whether at the stated maturity, by acceleration or otherwise) of such Loan Party’s Obligations:
(a) all Accounts;
(b) all Chattel Paper;
(c) all Contracts;
(d) the Deposit Accounts;
(e) all Documents;
(f) all Equipment;
(g) all General Intangibles;
(h) all Instruments;
(i) all Intellectual Property;
(j) all Inventory;
(k) all Investment Property;
(l) all Letter-of-Credit Rights;
(m) all Goods not otherwise described above;
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(n) all books and records pertaining to the foregoing; and
(o) to the extent not otherwise included, all Proceeds, Supporting Obligations and products of any and all of the foregoing and all collateral security and guarantees given by any Person with respect to any of the foregoing;
provided, however, that notwithstanding any of the other provisions set forth in this Section 2, this Agreement shall not constitute a grant of a security interest in any property to the extent that such grant of a security interest is prohibited by any Requirements of Law of a Governmental Authority, requires a consent not obtained of any Governmental Authority pursuant to such Requirement of Law or is prohibited by, or constitutes a breach or default under or results in the termination of or requires any consent not obtained under, any contract, license, agreement, instrument or other document evidencing or giving rise to such property or, in the case of any Investment Property, Pledged Stock or Pledged Note, any applicable shareholder or similar agreement, except to the extent that such Requirement of Law or the term in such contract, license, agreement, instrument or other document or shareholder or similar agreement providing for such prohibition, breach, default or termination or requiring such consent is ineffective under applicable law.
Section 3
REPRESENTATIONS AND WARRANTIES
To induce the Lenders and the Agent to enter into the Credit Agreement and the Lenders to make their extensions of credit to the Borrower thereunder, each Loan Party hereby represents and warrants to the Agent for the benefit of the Lenders holding Secured Term Loans that:
3.1 Title; No Other Liens. Except for the security interest granted to the Agent pursuant to this Agreement and the other Liens permitted to exist on the Collateral by the Credit Agreement, such Loan Party owns each item of the Collateral free and clear of any and all Liens or claims of others. No financing statement or other public notice with respect to all or any part of the Collateral is on file or of record in any public office, except such as have been filed in favor of the Agent, for the benefit of the Lenders holding Secured Term Loans, pursuant to this Agreement or as are permitted by the Credit Agreement.
3.2 Perfected First Priority Liens. The security interests granted pursuant to this Agreement (a) upon completion of the filings and other actions specified on Schedule 3 (which, in the case of all filings and other documents referred to on said Schedule, have been delivered to the Agent in completed and duly executed form) will constitute valid perfected security interests in all of the Collateral in favor of the Agent as collateral security for such Loan Party’s Obligations, enforceable in accordance with the terms hereof against all creditors of such Loan Party and any Persons purporting to purchase any Collateral from such Loan Party and (b) are prior to all other Liens on the Collateral in existence on the date hereof except, in the case of Collateral other than Pledged Stock and Pledged Note, to the extent permitted by the Credit Agreement.
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3.3 Jurisdiction of Organization; Chief Executive Office. On the date hereof, such Loan Party’s jurisdiction of organization, identification number from the jurisdiction of organization (if any), Federal Taxpayer Identification Number (if any) and the location of such Loan Party’s chief executive office or sole place of business or principal residence, as the case may be, are specified on Schedule 4. Such Loan Party has furnished to the Agent a certified charter, certificate of incorporation or other organization document and long-form good standing certificate as of a date which is recent to the date hereof.
3.4 Real Property. Schedule 5 is a list of all U.S. real property owned in fee or leased by such Loan Party as of the date hereof.
3.5 Inventory and Equipment. On the date hereof, a material portion of the Inventory and the Equipment (other than mobile goods) are kept at the locations listed on Schedule 6.
3.6 Farm Products. None of the Collateral constitutes, or is the Proceeds of, Farm Products in any material respect.
3.7 Investment Property. The shares of Pledged Stock pledged by such Loan Party hereunder constitute all the issued and outstanding shares of all classes of the Capital Stock of each Issuer owned by such Loan Party. All the shares of the Pledged Stock have been duly and validly issued and are fully paid and nonassessable. Each of the Pledged Notes constitutes the legal, valid and binding obligation of the obligor with respect thereto, enforceable in accordance with its terms, subject to the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar laws relating to or affecting creditors’ rights generally, general equitable principles (whether considered in a proceeding in equity or at law) and an implied covenant of good faith and fair dealing. Such Loan Party is the record and beneficial owner of, and has good and marketable title to, the Investment Property pledged by it hereunder, free of any and all Liens or options in favor of, or claims of, any other Person, except the security interest created by this Agreement.
3.8 Receivables. No material amount payable to such Loan Party under or in connection with any Receivable is evidenced by any Instrument or Chattel Paper which has not been delivered to the Agent. The amounts represented by such Loan Party to the Agent from time to time as owing to such Loan Party in respect of the Receivables will at such times be accurate in all material respects.
3.9 Intellectual Property. (a) Schedule 7 lists all registered or applied for Intellectual Property owned by such Loan Party in its own name on the date hereof which is material to such Loan Party.
(b) On the date hereof, all material Intellectual Property is valid, subsisting, unexpired and enforceable, has not been abandoned and, to the best knowledge of such Loan Party, does not infringe the intellectual property rights of any other Person.
(c) Except as set forth in Schedule 7, on the date hereof, no material Intellectual Property is the subject of any licensing or franchise agreement pursuant to which such Loan Party is the licensor or franchisor.
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(d) No holding, decision or judgment has been rendered by any Governmental Authority which would limit, cancel or question the validity of, or such Loan Party’s rights in, any Intellectual Property in any respect that could reasonably be expected to have a Material Adverse Effect.
(e) There is no action or proceeding pending, or, to the knowledge of such Loan Party, threatened, on the date hereof seeking to limit, cancel or question the validity of any Intellectual Property or such Loan Party’s ownership interest therein that could reasonably be expected to have a Material Adverse Effect.
3.10 Deposit Accounts and Securities Accounts. Schedule 8 is a true and complete list of all deposit accounts, brokerage accounts or securities investment accounts maintained by such Loan Party as of the date hereof, including the name and address of each institution where each such account is held, the type of each such account and the name of such Loan Party that holds each account. Except for Control arising by operation of law in favor of banks and securities intermediaries having custody over deposit accounts and securities accounts set forth on Schedule 8, no Person has Control of any deposit accounts and securities accounts in which any Loan Party has any interest.
3.11 Letter-of-Credit Rights. Schedule 9 is a true and correct list of all letters of credit issued in favor of such Loan Party, as beneficiary thereunder, as of the date hereof.
3.12 Commercial Tort Claims. Attached hereto as Schedule 10 is a list of Commercial Tort Claims held by such Loan Party as of the date hereof, including a brief description thereof.
Section 4
COVENANTS
Each Loan Party covenants and agrees with the Agent that, from and after the date of this Agreement until the Obligations shall have been paid in full:
4.1 Delivery of Instruments, Certificated Securities and Chattel Paper. If any amount in excess of an aggregate principal amount of $100,000 payable under or in connection with any of the Collateral shall be or become evidenced by any Instrument, Certificated Security or Chattel Paper, such Instrument, Certificated Security or Chattel Paper shall be immediately delivered to the Agent, duly indorsed in a manner satisfactory to the Agent, to be held as Collateral pursuant to this Agreement.
4.2 Payment of Obligations. Such Loan Party will pay and discharge or otherwise satisfy at or before maturity or before they become delinquent, as the case may be, all taxes, assessments and governmental charges or levies imposed upon the Collateral or in respect of income or profits therefrom, as well as all claims of any kind (including, without limitation, claims for labor, materials and supplies) against or with respect to the Collateral, except that no such tax, assessment, charge or levy need be paid if the amount or validity thereof is currently being contested in good faith by appropriate proceedings, reserves in conformity with GAAP with respect thereto have been provided on the books of such Loan Party or such failure to pay could not reasonably be expected to result in the sale, forfeiture or loss of any material portion of the Collateral or any interest therein.
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4.3 Maintenance of Perfected Security Interest; Further Documentation. Such Loan Party shall maintain the security interest created by this Agreement as a perfected security interest having at least the priority described in Section 3.2 and shall defend such security interest against the claims and demands of all Persons whomsoever, subject to the rights of such Loan Party under the Loan Documents to dispose of the Collateral. Such Loan Party will furnish to the Agent from time to time statements and schedules further identifying and describing the assets and property of such Loan Party and such other reports in connection therewith as the Agent may reasonably request, all in reasonable detail. At any time and from time to time, upon the written request of the Agent or the Required Lenders, and at the sole expense of such Loan Party, such Loan Party will promptly and duly execute and deliver, and have recorded, such further instruments and documents and take such further actions as may be necessary or advisable or as required by applicable law for the purpose of obtaining or preserving the full benefits of this Agreement and of the rights and powers herein granted, including, without limitation, (i) filing any financing or continuation statements under the Uniform Commercial Code (or other similar laws) in effect in any jurisdiction with respect to the security interests created hereby and (ii) to the extent commercially reasonable, in the case of Investment Property, the Deposit Accounts, Letter-of-Credit Rights and any other relevant Collateral, taking any actions necessary to enable the Agent to obtain “control” (within the meaning of the applicable Uniform Commercial Code) with respect thereto. Notwithstanding anything to the contrary contained herein or in the UCC, the Agent shall not have any obligation to (i) prepare, record, file, re-record, or re-file any financing statement, perfection statement, continuation statement or other instrument in any public office or for otherwise ensure the perfection, maintenance, priority or enforceability of any security interest granted pursuant to, or contemplated by, any Loan Document, (ii) take any necessary steps to preserve rights against any parties with respect to any Collateral, or (iii) take any action to protect against any diminution in value of the Collateral.
4.4 Changes in Locations, Name, etc. Such Loan Party will not, except upon 10 days’ prior written notice to the Agent and delivery to the Agent of (a) all additional executed financing statements and other documents as may be necessary or advisable or as required by applicable law to maintain the validity, perfection and priority of the security interests provided for herein and (b) if applicable, a written supplement to Schedule 6 showing any additional location at which material Inventory or Equipment shall be kept:
(a) change its jurisdiction of organization or the location of its chief executive office or sole place of business or principal residence from that referred to in Section 3.3; or
(b) change its name, identity or corporate structure to such an extent that any financing statement filed in connection with this Agreement would be misleading.
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4.5 Notices. Such Loan Party will advise the Agent promptly in reasonable detail of:
(a) any Lien (other than security interests created hereby or Liens permitted under the Credit Agreement) on any of the Collateral which would materially adversely affect the ability of the Agent to exercise any of its remedies hereunder; and
(b) of the occurrence of any other event which could reasonably be expected to have a material adverse effect on the aggregate value of the Collateral or on the security interests created hereby.
4.6 Investment Property. (a) If such Loan Party shall become entitled to receive or shall receive after the date hereof any certificate (including, without limitation, any certificate representing a dividend or a distribution in connection with any reclassification, increase or reduction of capital or any certificate issued in connection with any reorganization), option or rights in respect of the Capital Stock of any Issuer, whether in addition to, in substitution of, as a conversion of, or in exchange for, any shares of the Pledged Stock, or otherwise in respect thereof, such Loan Party shall accept the same as the agent of the Agent, hold the same in trust for the Agent and deliver the same forthwith to the Agent in the exact form received, duly indorsed by such Loan Party to the Agent, if required, together with an undated stock power covering such certificate duly executed in blank by such Loan Party and with, if the Agent so requests, signature guaranteed, to be held by the Agent, subject to the terms hereof, as additional collateral security for the Obligations. Any sums paid upon or in respect of the Investment Property upon the liquidation or dissolution of any Issuer shall be paid over to the Agent to be held by it hereunder as additional collateral security for the Obligations, and in case any distribution of capital shall be made on or in respect of the Investment Property or any property shall be distributed upon or with respect to the Investment Property pursuant to the recapitalization or reclassification of the capital of any Issuer or pursuant to the reorganization thereof, the property so distributed shall, unless otherwise subject to a perfected security interest in favor of the Agent, be delivered to the Agent to be held by it hereunder as additional collateral security for the Obligations. If any sums of money or property so paid or distributed in respect of the Investment Property shall be received by such Loan Party, such Loan Party shall, until such money or property is paid or delivered to the Agent, hold such money or property in trust for the Agent, segregated from other funds of such Loan Party, as additional collateral security for the Obligations.
(b) Without the prior written consent of the Agent acting at the direction of the Required Lenders, such Loan Party will not (i) vote to enable, or take any other action to permit, any Issuer to issue any Capital Stock of any nature or to issue any other securities convertible into or granting the right to purchase or exchange for any Capital Stock of any nature of any Issuer (except pursuant to a transaction permitted by the Credit Agreement or the Convertible Note Indentures), (ii) sell, assign, transfer, exchange, or otherwise dispose of, or grant any option with respect to, the Investment Property or Proceeds thereof (except pursuant to a transaction permitted by the Credit Agreement), (iii) create, incur or permit to exist any Lien or option in favor of, or any claim of any Person with respect to, any of the Investment Property or Proceeds thereof, or any interest therein, except for the security interests created by this Agreement or permitted by the Credit Agreement or (iv) enter into any agreement or undertaking restricting the right or ability of such Loan Party or the Agent to sell, assign or transfer any of the Investment Property or Proceeds thereof except as permitted by the Credit Agreement.
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(c) In the case of each Loan Party which is an Issuer, such Issuer agrees that it will be bound by the terms of this Agreement relating to the Investment Property issued by it and will comply with such terms insofar as such terms are applicable to it.
(d) In the case of each Loan Party which holds Pledged Notes that have not been delivered into the possession of the Agent, such Loan Party agrees that it will not sell, transfer or otherwise dispose of such Pledged Notes to any other party other than another Loan Party under the Loan Documents.
4.7 Receivables. Other than in the ordinary course of business consistent with its past practice and unless commercially reasonable, such Loan Party will not (i) (as to any Receivable which is a material amount) grant any extension of the time of payment of any Receivable, (ii) compromise or settle any Receivable for less than the full amount thereof, (iii) release, wholly or partially, any Person liable for the payment of any Receivable, (iv) allow any credit or discount whatsoever on any Receivable or (v) amend, supplement or modify any Receivable in any manner that could materially adversely affect the value thereof. Such Loan Party will deliver to the Agent a copy of each material demand, notice or document received by it that questions or calls into doubt the validity or enforceability of more than 5% of the aggregate amount of the then outstanding Receivables.
4.8 Deposit Accounts and Securities Accounts. Absent written agreement of the Agent to the contrary, each Loan Party will obtain control agreements, in form and substance satisfactory to the Agent and the Required Lenders, with respect to deposit accounts (excluding (i) deposit accounts established exclusively for petty cash for which amounts on deposit do not exceed $25,000 in the aggregate with respect to all such accounts at any one time, (ii) payroll accounts, (iii) zero balance accounts and (iv) withholding and trust accounts) and securities accounts; provided, however, that such control agreements shall not be required until such time the initial funding with respect to the Construction Financing is made.
4.9 Letters of Credit. Each Loan Party shall use commercially reasonable efforts to deliver to the Agent all letters of credit, duly endorsed and accompanied by duly executed instruments of transfer or assignment, all in form and substance reasonably satisfactory to the Agent and the Required Lenders. Each Loan Party shall take any and all actions as may be necessary or desirable, or that the Agent may reasonably request, from time to time, to cause the Agent to obtain exclusive Control of any Letter-of-Credit Rights to the extent constituting Collateral owned by any Loan Party with respect to the letters of credit referred to in the immediately preceding sentence in a manner reasonably acceptable to the Agent and the Required Lenders.
4.10 Equipment. Each Loan Party shall cause all Equipment owned by such Loan Party to be maintained and preserved in the same condition, repair and in working order as when new, ordinary wear and tear excepted, and shall promptly make or cause to be made all repairs, replacements and other improvements in connection therewith that are necessary or desirable to such end. Upon the request of the Agent after the occurrence and during the continuance of an Event of Default, each Loan Party shall promptly deliver to the Agent any and all certificates of title, applications for title or similar evidence of ownership of all Equipment to the extent constituting Collateral and shall cause the Agent to be named as lienholder on any such certificate of title or other evidence of ownership.
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4.11 General Intangibles. Each Loan Party shall use commercially reasonable efforts to obtain any consents, waivers or agreements necessary to enable the Agent to exercise remedies hereunder and under the other Loan Documents with respect to any of such Loan Party’s rights under any General Intangibles to the extent constituting Collateral.
4.12 Commercial Tort Claims. Each Loan Party shall promptly advise the Agent in writing upon such Loan Party becoming aware that it has any interest in Commercial Tort Claims. With respect to any Commercial Tort Claims in which any Loan Party has any interest, such Loan Party shall execute and deliver such documents as may be necessary or desirable, or that the Agent may reasonably request, to create, perfect and protect the Agent’s or the Required Lenders’ security interest in such Commercial Tort Claim.
Section 5
REMEDIAL PROVISIONS
5.1 Certain Matters Relating to Receivables. If required by the Agent (acting at the direction of the Required Lenders) at any time after the occurrence and during the continuance of an Event of Default, any payments of Receivables, when collected by any Loan Party, (i) shall be forthwith (and, in any event, within three Business Days) deposited by such Loan Party in the exact form received, duly indorsed by such Loan Party to the Agent if required, in a Collateral Account maintained under the sole dominion and control of the Agent, subject to withdrawal by the Agent only as provided in Section 5.5, and (ii) until so turned over, shall be held by such Loan Party in trust for the Agent, for the benefit of the Lenders holding Secured Term Loans, segregated from other funds of such Loan Party. Each such deposit of Proceeds of Receivables shall be accompanied by a report identifying in reasonable detail the nature and source of the payments included in the deposit. Upon the occurrence and during the continuance of an Event of Default, at the reasonable request of the Agent, each Loan Party shall deliver to the Agent all original and other documents evidencing, and relating to, the agreements and transactions which gave rise to the Receivables, including, without limitation, all original orders, invoices and shipping receipts.
5.2 Communications with Obligors; Loan Parties Remain Liable. The Agent in its own name or in the name of others may at any time after the occurrence and during the continuance of an Event of Default communicate with obligors under the Receivables to verify with them to the satisfaction of the Agent the existence, amount and terms of any Receivables. Upon the request of the Agent at any time after the occurrence and during the continuance of an Event of Default, each Loan Party shall notify obligors on the Receivables that the Receivables have been assigned to the Agent and that payments in respect thereof shall be made directly to the Agent. Anything herein to the contrary notwithstanding, each Loan Party shall remain liable under each of the Receivables to observe and perform all the conditions and obligations to be observed and performed by it thereunder, all in accordance with the terms of any agreement giving rise thereto. The Agent shall not have any obligation or liability under any Receivable (or any agreement giving rise thereto) by reason of or arising out of this Agreement or the receipt by the Agent of any payment relating thereto, nor shall the Agent be obligated in any manner to perform any of the obligations of any Loan Party under or pursuant to any Receivable (or any agreement giving rise thereto), to make any payment, to make any inquiry as to the nature or the sufficiency of any payment received by it or as to the sufficiency of any performance by any party thereunder, to present or file any claim, to take any action to enforce any performance or to collect the payment of any amounts which may have been assigned to it or to which it may be entitled at any time or times.
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5.3 Pledged Stock. Unless an Event of Default shall have occurred and be continuing and the Agent (acting at the direction of the Required Lenders) shall have given notice to the relevant Loan Party of the intent of the Agent to exercise its rights pursuant to this Section 5.3, each Loan Party shall be permitted to receive all cash dividends paid in respect of the Pledged Stock and all payments made in respect of the Pledged Notes, in each case paid in the normal course of business of the relevant Issuer and consistent with past practice, to the extent permitted in the Credit Agreement, and to exercise all voting and corporate or other organizational rights with respect to the Investment Property; provided, however, that no vote shall be cast or corporate or other organizational right exercised or other action taken which, would materially impair the Collateral or which would be inconsistent with or result in any violation of any provision of the Credit Agreement, this Agreement or any other Loan Document. If an Event of Default shall occur and be continuing and the Agent (acting at the direction of the Required Lenders) shall give notice of its intent to exercise such rights to the relevant Loan Party or Loan Parties, (i) the Agent shall have the right to receive any and all cash dividends, payments or other Proceeds paid in respect of the Investment Property and make application thereof to the Obligations in accordance with Section 5.5 hereof and (ii) any or all of the Investment Property shall be registered in the name of the Agent or its nominee, and the Agent or its nominee may thereafter exercise (x) all voting, corporate and other rights pertaining to such Investment Property at any meeting of shareholders of the relevant Issuer or Issuers or otherwise and (y) any and all rights of conversion, exchange and subscription and any other rights, privileges or options pertaining to such Investment Property as if it were the absolute owner thereof (including, without limitation, the right to exchange at its discretion any and all of the Investment Property upon the merger, consolidation, reorganization, recapitalization or other fundamental change in the corporate or other organizational structure of any Issuer, or upon the exercise by any Loan Party or the Agent of any right, privilege or option pertaining to such Investment Property, and in connection therewith, the right to deposit and deliver any and all of the Investment Property with any committee, depositary, transfer agent, registrar or other designated agency upon such terms and conditions as the Agent may determine), all without liability except to account for property actually received by it, but the Agent shall have no duty to any Loan Party to exercise any such right, privilege or option and shall not be responsible for any failure to do so or delay in so doing and if it does do so, shall have no liability to the Loan Parties for the sufficiency thereof. Each Loan Party hereby authorizes and instructs each Issuer of any Investment Property pledged by such Loan Party hereunder to (i) comply with any instruction received by it from the Agent in writing that (x) states that an Event of Default has occurred and is continuing and (y) is otherwise in accordance with the terms of this Agreement, without any other or further instructions from such Loan Party, and each Loan Party agrees that each Issuer shall be fully protected in so complying, and (ii) unless otherwise expressly permitted hereby, pay any dividends or other payments with respect to the Investment Property directly to the Agent for application to the Obligations in accordance with Section 5.5 hereof.
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5.4 Proceeds to Be Turned Over to Agent. In addition to the rights of the Agent specified in Section 5.1 with respect to payments of Receivables, if an Event of Default shall occur and be continuing, all Proceeds received by any Loan Party consisting of cash, checks and other near-cash items shall be held by such Loan Party in trust for the Agent, segregated from other funds of such Loan Party, and shall, forthwith upon receipt by such Loan Party, be turned over to the Agent in the exact form received by such Loan Party (duly indorsed by such Loan Party to the Agent, if required). All Proceeds received by the Agent hereunder shall be held by the Agent in a Collateral Account maintained under its sole dominion and control. All Proceeds while held by the Agent in a Collateral Account (or by such Loan Party in trust for the Agent) shall continue to be held as collateral security for all the Obligations and shall not constitute payment thereof until applied as provided in Section 5.5.
5.5 Application of Proceeds. At such intervals as may be agreed upon by the Borrower and the Agent (acting at the direction of the Required Lenders) or, if an Event of Default shall have occurred and be continuing, (x) if such event is an Event of Default specified in paragraph (f) of Section 7 of the Credit Agreement with respect to the Borrower, automatically, (y) if such event is an Event of Default specified in paragraph (j) of Section 7 of the Credit Agreement, at any time as the Agent may be so directed by any Lender or (z) if such event is any other Event of Default, at any time as the Agent may be so directed by the Required Lenders, the Agent may apply all or any part of Proceeds constituting Collateral, whether or not held in any Collateral Account, in payment of the Obligations in the following order: first, to any costs, fees, expenses and other amounts incurred by the Agent in connection with this Agreement, the Credit Agreement, any other Loan Document or any of the Obligations (including the reasonable costs, fees and expenses of its agents and legal counsel, and any costs or expenses incurred in connection with the exercise by the Agent of any right or remedy under this Agreement, the Credit Agreement or any other Loan Document); second, to the ratable satisfaction of the Obligations; and third, any balance of remaining Proceeds to the Borrower or to whomsoever may be lawfully entitled to receive the same. Any balance of such Proceeds remaining after the Obligations shall have been paid in full shall be paid over to the Borrower or to whomsoever may be lawfully entitled to receive the same.
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5.6 Code and Other Remedies. If an Event of Default shall occur and be continuing, the Agent may exercise, in addition to all other rights and remedies granted to them in this Agreement and in any other instrument or agreement securing, evidencing or relating to the Obligations, all rights and remedies of the Agent under the New York UCC or any other applicable law. Without limiting the generality of the foregoing, the Agent, without demand of performance or other demand, presentment, protest, advertisement or notice of any kind (except any notice required by law referred to below) to or upon any Loan Party or any other Person (all and each of which demands, defenses, advertisements and notices are hereby waived), may in such circumstances forthwith collect, receive, appropriate and realize upon the Collateral, or any part thereof, and/or may forthwith sell, lease, assign, give option or options to purchase, or otherwise dispose of and deliver the Collateral or any part thereof (or contract to do any of the foregoing), in one or more parcels at public or private sale or sales, at any exchange, broker’s board or office of the Agent or elsewhere upon such terms and conditions as it may deem advisable and at such prices as it may deem best, for cash or on credit or for future delivery without assumption of any credit risk. The Agent shall have the right upon any such public sale or sales, and, to the extent permitted by law, upon any such private sale or sales, to purchase the whole or any part of the Collateral so sold, free of any right or equity of redemption in any Loan Party, which right or equity is hereby waived and released. Each Loan Party further agrees, at the Agent’s request, to assemble the Collateral and make it available to the Agent at places which the Agent shall reasonably select, whether at such Loan Party’s premises or elsewhere. The Agent shall apply the net proceeds of any action taken by it pursuant to this Section 5.6, after deducting all reasonable costs and expenses of every kind incurred in connection therewith or incidental to the care or safekeeping of any of the Collateral or in any way relating to the Collateral or the rights of the Agent hereunder, including, without limitation, reasonable attorneys’ fees and disbursements, to the payment in whole or in part of the Obligations, in the order as set forth in Section 5.5, and only after such application and after the payment by the Agent of any other amount required by any provision of law, including, without limitation, Section 9-615(a) of the New York UCC, need the Agent account for the surplus, if any, to any Loan Party. To the extent permitted by applicable law, each Loan Party waives all claims, damages and demands it may acquire against the Agent arising out of the exercise by them of any rights hereunder. If any notice of a proposed sale or other disposition of Collateral shall be required by law, such notice shall be deemed reasonable and proper if given at least 10 days before such sale or other disposition. Each Loan Party recognizes that the Agent may be unable to effect a public sale of any or all the Collateral and may be compelled to resort to one or more private sales thereof. Each Loan Party also acknowledges that any private sale may result in prices and other terms less favorable to the seller than if such sale were a public sale and, notwithstanding such circumstances, agrees that any such private sale shall not be deemed to have been made in a commercially unreasonable manner solely by virtue of such sale being private and each Loan Party waives, to the extent permitted by applicable law, any claims against Agent and the Lenders arising by reason of the fact that the price at which the Collateral may have been sold at such a private sale was less than the price that might have been obtained at a public sale or was less than the aggregate amount of the Obligations, even if Agent accepts the first offer received and does not offer the Collateral to more than one offeree; provided that such private sale is conducted in accordance with this Agreement. The Agent shall be under no obligation to delay a sale of any of the Collateral for the period of time necessary to permit any Loan Party or the issuer of any Collateral to register such securities for public sale under the Securities Act, or under applicable state securities laws, even if the applicable Loan Party and the issuer would agree to do so. Each Loan Party hereby agrees that in respect of any sale of any of the Collateral pursuant to the terms hereof, the Agent is hereby authorized to comply with any limitation or restriction in connection with such sale as it may be advised by counsel is necessary in order to avoid any violation of applicable law, or in order to obtain any required approval of the sale or of the purchaser by any governmental authority, and each Loan Party further agrees that such compliance shall not, in and of itself, result in such sale being considered or deemed not to have been made in a commercially reasonable manner, nor shall Agent be liable or accountable to any Loan Party for any discount allowed by reason of the fact that such Collateral is sold in compliance with any such limitation or restriction.
5.7 Deficiency. Each Loan Party shall remain liable for any deficiency if the proceeds of any sale or other disposition of the Collateral are insufficient to pay its Obligations and the fees and disbursements of any attorneys employed by the Agent to collect such deficiency.
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Section 6
MISCELLANEOUS
6.1 Amendments in Writing. None of the terms or provisions of this Agreement may be waived, amended, supplemented or otherwise modified except in accordance with Section 9.1 of the Credit Agreement.
6.2 Notices. All notices, requests and demands to or upon the Agent or any Loan Party hereunder shall be effected in the manner provided for in Section 9.2 of the Credit Agreement.
6.3 No Waiver by Course of Conduct; Cumulative Remedies. The Agent shall not by any act (except by a written instrument pursuant to Section 6.1), delay, indulgence, omission or otherwise be deemed to have waived any right or remedy hereunder or to have acquiesced in any Default or Event of Default. No failure to exercise, nor any delay in exercising, on the part of the Agent any right, power or privilege hereunder shall operate as a waiver thereof. No single or partial exercise of any right, power or privilege hereunder shall preclude any other or further exercise thereof or the exercise of any other right, power or privilege. A waiver by the Agent of any right or remedy hereunder on any one occasion shall not be construed as a bar to any right or remedy which the Agent would otherwise have on any future occasion. The rights and remedies herein provided are cumulative, may be exercised singly or concurrently and are not exclusive of any other rights or remedies provided by law.
6.4 Enforcement Expenses; Indemnification. Each Loan Party jointly and severally agrees to pay, and to save the Agent harmless from, any and all liabilities with respect to, or resulting from any delay in paying, any and all stamp, excise, sales or other taxes which may be payable or determined to be payable with respect to any of the Collateral or in connection with any of the transactions contemplated by this Agreement, except to the extent such liabilities were caused by the gross negligence or willful misconduct of the Agent, as determined by a final and nonappealable decision of a court of competent jurisdiction. Each Loan Party jointly and severally agrees to pay, and to save the Agent harmless from, any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever with respect to the execution, delivery, enforcement, performance and administration of this Agreement to the extent the Borrower would be required to do so pursuant to Section 9.5 of the Credit Agreement. The agreements in this Section 6.4 shall survive repayment of the Obligations and all other amounts payable under the Credit Agreement and the other Loan Documents and the resignation or removal of the Agent.
6.5 Successors and Assigns. This Agreement shall be binding upon the successors and assigns of each Loan Party and shall inure to the benefit of the Agent and its successors and assigns; provided that no Loan Party may assign, transfer or delegate any of its rights or obligations under this Agreement without the prior written consent of the Agent and the Required Lenders.
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6.6 Set-off. Each Loan Party hereby irrevocably authorizes the Agent at any time and from time to time while an Event of Default shall have occurred and be continuing, without notice to such Loan Party or any other Loan Party, any such notice being expressly waived by each Loan Party, to set-off and appropriate and apply any and all deposits (general or special, time or demand, provisional or final), in any currency, and any other credits, indebtedness or claims, in any currency, in each case whether direct or indirect, absolute or contingent, matured or unmatured, at any time held or owing by the Agent to or for the credit or the account of such Loan Party, or any part thereof in such amounts as the Agent may elect, against and on account of the obligations and liabilities of such Loan Party to the Agent hereunder and claims of every nature and description of the Agent against such Loan Party, in any currency, whether arising hereunder, under the Credit Agreement or any other Loan Document, as the Agent may elect, whether or not the Agent has made any demand for payment and although such obligations, liabilities and claims may be contingent or unmatured. The Agent shall notify such Loan Party promptly of any such set-off and the application made by the Agent of the proceeds thereof, provided that the failure to give such notice shall not affect the validity of such set-off and application. The rights of the Agent under this Section 6.6 are in addition to other rights and remedies (including, without limitation, other rights of set-off) which the Agent may have.
6.7 Counterparts. This Agreement may be executed by one or more of the parties to this Agreement on any number of separate counterparts (including by telecopy), and all of said counterparts taken together shall be deemed to constitute one and the same instrument.
6.8 Severability. Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.
6.9 Section Headings. The Section headings used in this Agreement are for convenience of reference only and are not to affect the construction hereof or be taken into consideration in the interpretation hereof.
6.10 Integration. This Agreement and the other Loan Documents represent the agreement of the Loan Parties and the Agent with respect to the subject matter hereof, and there are no promises, undertakings, representations or warranties by the Agent relative to subject matter hereof not expressly set forth or referred to herein, in the other Loan Documents.
6.11 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK AND APPLICABLE FEDERAL LAW.
6.12 Submission to Jurisdiction; Waivers. Each Loan Party hereby irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or proceeding relating to this Agreement and the other Loan Documents to which it is a party, or for recognition and enforcement of any judgment in respect thereof, to the non-exclusive general jurisdiction of the courts of the State and County of New York, the courts of the United States of America for the Southern District of New York, and appellate courts from any thereof;
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(b) consents that any such action or proceeding may be brought in such courts and waives any objection that it may now or hereafter have to the venue of any such action or proceeding in any such court or that such action or proceeding was brought in an inconvenient court and agrees not to plead or claim the same;
(c) agrees that service of process in any such action or proceeding may be effected by mailing a copy thereof by registered or certified mail (or any substantially similar form of mail), postage prepaid, to such Loan Party at its address referred to in Section 6.2 or at such other address of which the Agent shall have been notified pursuant thereto;
(d) agrees that nothing herein shall affect the right to effect service of process in any other manner permitted by law or shall limit the right to sue in any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law, any right it may have to claim or recover in any legal action or proceeding referred to in this Section any special, exemplary, punitive or consequential damages.
6.13 Acknowledgments. Each Loan Party hereby acknowledges that:
(a) it has been advised by counsel in the negotiation, execution and delivery of this Agreement and the other Loan Documents to which it is a party;
(b) the Agent has no fiduciary relationship with or duty to any Loan Party arising out of or in connection with this Agreement or any of the other Loan Documents, and the relationship between the Loan Parties, on the one hand, and the Agent, on the other hand, in connection herewith or therewith is solely that of debtor and creditor; and
(c) no joint venture is created hereby or by the other Loan Documents or otherwise exists by virtue of the transactions contemplated hereby among the Loan Parties and the Agent or any Lender.
6.14 Releases. At such time as the Loans and the other Obligations shall have been paid in full, the Collateral shall be released from the Liens created hereby, and this Agreement and all obligations (other than those expressly stated to survive such termination) of the Agent and each Loan Party hereunder (including all guarantee obligations) shall terminate, all without delivery of any instrument or performance of any act by any party, and all rights to the Collateral shall revert to the Loan Parties. At the request and sole expense of any Loan Party following any such termination, the Agent shall (upon receiving the consent of the Required Lenders) deliver to such Loan Party any Collateral held by the Agent hereunder, and execute and deliver to such Loan Party such documents as such Loan Party shall reasonably request to evidence such termination; provided that the Loan Parties shall provide to the Agent evidence of such termination as the Agent shall reasonably request. If any of the Collateral shall be sold, transferred or otherwise disposed of by any Loan Party in a transaction permitted by the Credit Agreement, then the Agent, at the request and sole expense of such Loan Party, shall (upon receiving the consent of the Required Lenders) execute and deliver to such Loan Party all releases or other documents reasonably necessary or desirable for the release of the Liens created hereby on such Collateral; provided that the Loan Parties shall provide to the Agent evidence of such transaction’s compliance with the Loan Documents as the Agent shall reasonably request.
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6.15 Waiver of Jury Trial. EACH LOAN PARTY AND THE AGENT HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.
6.16 The Agent. It is expressly understood and agreed by the parties to this Agreement that (i) Wells Fargo Bank, National Association is entering into this Agreement and acting hereunder solely in its capacity as Agent under the Credit Agreement and (ii) in entering into and acting as Agent hereunder, Wells Fargo Bank, National Association shall be afforded all of the rights, protections, benefits, indemnities (in addition to those set forth in Section 6.4 hereof) and immunities granted to the Agent in the Credit Agreement as if set forth in their entirety herein. Any act, or refusal to act, hereunder requiring the Agent to exercise discretion (including, but not limited to, the exercise of remedies following an Event of Default) shall be exercised in accordance with the terms of the Credit Agreement. The permissive authorizations, entitlements, powers and rights granted to the Agent herein (including the right to (i) request any documentation, (ii) request the taking of any action and (iii) exercise any remedies) shall not be construed as duties.
[REMAINDER OF THIS PAGE LEFT INTENTIONALLY BLANK]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and delivered as of the date first written above.
LOAN PARTIES: | ||
CADIZ INC. | ||
By: | /s/ Timothy J. Shaheen | |
Name: Timothy J. Shaheen | ||
Title: Chief Financial Officer | ||
CADIZ REAL ESTATE LLC | ||
By: | /s/ Timothy J. Shaheen | |
Name: Timothy J. Shaheen | ||
Title: Chief Financial Officer |
AGENT: | ||
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Agent | ||
By: | /s/ Michael Pinzon | |
Name: Michael Pinzon | ||
Title: Vice President |
SCHEDULE 1
NOTICE ADDRESSES OF Loan Parties
c/o
Cadiz Inc.
550 South Hope Street, Suite 2850
Los Angeles, CA 90071
Attention: Chief Financial Officer
Telecopy: 213-271-1614
Telephone: 213-271-1600
Sch. 1-1 |
SCHEDULE 2
DESCRIPTION OF INVESTMENT PROPERTY
Pledged Stock
Issuer | Class of Stock | No. of Shares | Stock Certificate No. | |||||||
Cadiz Real Estate LLC | Membership Interest | 100% Interest | N/A | |||||||
Octagon Partners LLC | Membership Interest | 100% Interest | N/A | |||||||
SWI Estate Inc. | Common Stock | 100% Interest | N/A | |||||||
Rancho Cadiz Mutual Water Company | Common Stock | 100% Interest | N/A |
Pledged Notes
None.
Sch. 2-1 |
SCHEDULE 3
FILINGS
AND OTHER ACTIONS REQUIRED
TO PERFECT SECURITY INTERESTS
Uniform Commercial Code Filings
Loan Party | UCC Filing Jurisdictions | |
Cadiz Inc. | Delaware California San Bernardino County, California | |
Cadiz Real Estate LLC | Delaware California San Bernardino County, California |
Patent and Trademark Filings
None.
Actions with Respect to Pledged Stock and Pledged Note
None.
Sch. 3-1 |
SCHEDULE 4
JURISDICTION
OF ORGANIZATION, ORGANIZATIONAL NUMBER, FEIN
AND CHIEF EXECUTIVE OFFICE
Loan Party | Jurisdiction of Organization | Organizational Number | Federal Taxpayer ID Number | Chief Executive Office | ||||||||
Cadiz Inc. | Delaware | 2295882 | 77-0313235 | 550 South Hope Street Suite 2850 Los Angeles, CA 90071 | ||||||||
Cadiz Real Estate LLC | Delaware | 3729320 | N/A | 550 South Hope Street Suite 2850 Los Angeles, CA 90071 |
Sch. 4-1 |
SCHEDULE 5
OWNED AND LEASED PROPERTY
Owned Property
Described in Schedule 1.1B (Mortgaged Properties) to the Credit Agreement.
Leased Property
None.
Sch. 5-1 |
SCHEDULE 6
LOCATIONS OF INVENTORY AND EQUIPMENT
Loan Party | Locations | |
Cadiz Inc. | 550 South Hope Street, Suite 2850, Los Angeles, CA 90071 | |
Cadiz Real Estate LLC | 550 South Hope Street, Suite 2850, Los Angeles, CA 90071 96-726 National Trails Highway, CA 92304 |
Sch. 6-1 |
SCHEDULE 7
INTELLECTUAL PROPERTY
Copyrights and Copyright Licenses
None.
Patents and Patent Licenses
None.
Trademarks and Trademark Licenses
None.
Sch. 7-1 |
SCHEDULE 8
Deposit Accounts and Securities Accounts
Deposit Accounts
Owner | Type of Account | Bank Name/Address | Account No. | |||
Cadiz Inc. | Certificate of Deposit | US Bank | ||||
Cadiz Inc. | Escrow | US Bank | ||||
Cadiz Inc. | Checking (Payroll) | US Bank | ||||
Cadiz Inc. | Checking (Operating) | US Bank | ||||
Cadiz Inc. | Checking (Project) | US Bank | ||||
Cadiz Inc. | Checking (Operating) | US Bank |
Securities Accounts
None.
Sch. 8-1 |
SCHEDULE 9
Letter of Credit Rights
None.
Sch. 9-1 |
SCHEDULE 10
Commercial Tort Claims
None.
Sch.10-1
Exhibit 10.3
RECORDING REQUESTED BY:
Paul, Weiss, Rifkind, Wharton & Garrison LLP
AND WHEN RECORDED MAIL TO:
Paul, Weiss, Rifkind, Wharton & Garrison LLP 1285 Avenue of the Americas New York, NY 10019-6064 Attn.: Peter E. Fisch, Esq. |
Space above this line for recorder’s use only
DEED OF TRUST, ASSIGNMENT OF LEASES AND RENTS, SECURITY
AGREEMENT, FINANCING STATEMENT AND FIXTURE FILING
dated as of May 25, 2017
Cadiz
Inc., Cadiz Real Estate LLC, and Octagon Partners, LLC,
collectively, as Trustor
to
Chicago
Title Company,
as Trustee
and
Wells Fargo Bank National Association, as Agent for the Lenders from time to time
under the Credit Agreement,
as Beneficiary
DEED OF TRUST, ASSIGNMENT OF LEASES AND RENTS, SECURITY
AGREEMENT, FINANCING STATEMENT AND FIXTURE FILING
THIS DEED OF TRUST, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT, FINANCING STATEMENT AND FIXTURE FILING (this “Deed of Trust”) is made as of May 25, 2017 (the “Effective Date”), by and among CADIZ INC., a Delaware corporation formerly known as and formerly named Cadiz Land Company, Inc., a Delaware corporation, which (i) took title to the property described as Parcel 21 on Exhibit A hereto as “Pergola Properties” and (ii) was successor by merger to Cadiz Valley Development Corporation, a California Corporation, with an address of 550 South Hope Street, Suite 2850, Los Angeles, California, 90071 (“Cadiz”) and CADIZ REAL ESTATE LLC, a Delaware limited liability company with an address of 550 South Hope Street, Suite 2850, Los Angeles, California, 90071 (“CRE”), and Octagon Partners, LLC, a California limited liability company with an address of 550 South Hope Street, Suite 2850, Los Angeles, California, 90071 (“Octagon”, together with Cadiz and CRE, collectively the “Trustor”), in favor of Chicago Title Company, having an office at 560 East Hospitality Lane, San Bernardino, California 92408, as trustee (the “Trustee”) for the benefit of WELLS FARGO BANK NATIONAL ASSOCIATION, with an address of 9062 Old Annapolis Road, Columbia, Maryland 21045, as the Agent for the Lenders from time to time under the Credit Agreement (together with its successors and assigns in such capacity, the “Beneficiary”).
WHEREAS, reference is made to that certain Credit Agreement, dated as of May 1, 2017 (as amended, modified, waived, amended and restated or otherwise changed from time to time, the “Credit Agreement”), by and among Cadiz, CRE, the lenders from time to time party thereto (the “Lenders”) and Wells Fargo Bank National Association, as administrative agent (the “Agent”) whereupon Lenders have extended a credit facility to the Trustor in an aggregate principal amount of $60,000,000 in the form of Secured Term Loans and Loan Commitments (as defined in the Credit Agreement).
WHEREAS, the Trustor will receive substantial benefits from the execution, delivery and performance of the obligations under the Credit Agreement and the other Loan Documents (as defined in the Credit Agreement), and is, therefore, willing to enter into this Deed of Trust.
WHEREAS, this Deed of Trust is given by Trustor in favor of the Trustee for the benefit of the Beneficiary to secure the payment and performance of all of the Obligations (as defined in the Credit Agreement) with respect to the Secured Term Loans and Loan Commitments.
WHEREAS, it is a condition to the obligations of the Lenders to make the Secured Term Loans under the Credit Agreement that Trustor execute and deliver this Deed of Trust.
NOW, THEREFORE, the parties hereto agree as follows:
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ARTICLE
I
GRANTS AND OBLIGATIONS SECURED
A. GRANT
1.1. FOR GOOD AND VALUABLE CONSIDERATION, including the indebtedness herein recited and the trust herein created, the receipt of which is hereby acknowledged, as collateral security for the payment and performance of all the Obligations, Trustor hereby irrevocably GRANTS, BARGAINS, ASSIGNS, SELLS, CONVEYS and CONFIRMS to Trustee, IN TRUST, WITH POWER OF SALE AND RIGHT OF ENTRY AND POSSESSION, for the benefit and security of Beneficiary, under and subject to the terms and conditions hereinafter set forth, and grants to Beneficiary a security interest in the following property, rights, interests and estates of Trustor whether now owned or hereafter arising or acquired, from time to time:
(i) that certain real property located in the County of San Bernardino, State of California more particularly described in Exhibit A attached hereto and by this reference incorporated herein (all such real property described in Exhibit A is collectively referred to herein as the “Premises”);
(ii) TOGETHER WITH any and all structures, buildings and improvements and any and all alterations now or hereafter located or erected on the Premises, all pumps and pumping stations used in connection therewith and all shares of stock evidencing the same, all fixtures, attachments, appliances, equipment, machinery, furnishings, inventory and other articles or property used or usable in connection with the Premises or attached or affixed in any manner to said structures, buildings and improvements including, but not limited to all storage tanks and pipelines, all gas, electric, heating, cooling, air conditioning, refrigeration, ventilation, sanitation, and plumbing fixtures and equipment and any additions to, substitutions for, changes or replacements of the whole or any part thereof (collectively, the “Improvements”), all of which shall be deemed and construed to be a part of the realty;
(iii) TOGETHER WITH all rents, earnings, issues, profits, royalties, income, accounts receivable, revenues, deposits, security deposits, receipts and other benefits (collectively, the “Rents”) derived or generated from the use and operation of the Premises, Improvements and the Collateral (as hereinafter defined) or to which Trustor may be entitled, whether now due, past due or to become due or from any lease, sublease, license, franchise or concession, occupancy agreement or other agreement now or hereafter affecting all or any portion of the Premises or the Improvements or the use, operation or occupancy thereof (collectively, the “Leases”), subject to the terms and provisions of Article 3 hereof;
(iv) TOGETHER WITH all right, title and interest now or hereafter appertaining, belonging to or acquired by Trustor in and to any easements, rights-of-way, rights, licenses, profits, and privileges used in connection therewith or as a means of access thereto, including, without limiting the generality of the foregoing, all rights pursuant to any trackage agreement and all rights to the nonexclusive use of common drive entries, any after acquired title and reversion in or to each and every part of all streets, roads, ways, passages, sidewalks, highways and alleys adjacent to and adjoining the same, and all tenements, hereditaments and appurtenances thereof and thereto (collectively, the “Appurtenances”);
(v) TOGETHER WITH all right, title and interest of Trustor, whether owned legally, of record, equitably, beneficially or otherwise, whether constituting real or personal property (or subject to any other characterizations), whether created or authorized under existing or future laws or regulations, and however arising, in all water rights and assets (collectively, the “Water Rights and Assets”), including without limitation, the following;
(a) All water (including any water inventory in storage), water rights and entitlements, other rights to water and other rights to receive water or water rights of every kind or nature whatsoever including (i) the groundwater on, under, pumped from or otherwise available to the Premises, whether as the result of groundwater rights, contractual rights or otherwise, (ii) Trustor’s right to remove and extract any such groundwater including any permits, rights or licenses granted by any governmental authority or agency or any rights granted or created by any use, easement, covenant, agreement, or contract with any Person, (iii) any rights to which the Premises is entitled with respect to surface water, whether such right is appropriative, riparian, prescriptive, decreed or otherwise and whether or not pursuant to permit or other governmental authorization, or the right to store any such water, (iv) any water, water right, water allocation, distribution right, delivery right, water storage right, or other water-related entitlement appurtenant or otherwise applicable to the Premises by virtue of the Premises being situated within the boundaries of any district, agency, or other governmental entity or within the boundaries of any private water company, mutual water company, or other non-governmental entity, and (v) all rights in and to pumping plants, pipes, flumes and all rights in ditches for irrigation of the Premises;
(b) All stock, interest or rights (including any water allocations, voting or decision rights) in any entity, together with any and all rights from any entity or other Person to acquire, receive, exchange, sell, lease or otherwise transfer any water or other Water Rights and Assets, to store, deposit or otherwise create water credits in a water bank or similar or other arrangements for allocating water, to transport or deliver water, or otherwise to deal with any Water Rights and Assets;
(c) All licenses, permits, approvals, contracts, decrees, rights and interests to acquire or appropriate any water or other Water Rights and Assets, water bank or other credits evidencing any right to water or other Water Rights and Assets, to store, carry, transport or deliver water or other Water Rights and Assets, to sell, lease, exchange, or otherwise transfer any water or other Water Rights and Assets, or to change the point for diversion of water, the location of any water or Water Rights and Assets, the place of use of any water or Water Rights and Assets, or the purpose of the use of any water or Water Rights and Assets;
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(d) All rights, claims, causes of action, judgments, awards, and other judicial, arbiter or administrative relief in any way relating to any water or Water Rights and Assets;
(e) All storage and treatment rights for any water or any other Water Rights and Assets, whether on or off the Premises or other property of Trustor, together with all storage tanks, and other equipment used or usable in connection with such storage and any water bank deposit credits, deposit accounts;
(f) All rights to transport, carry, allocate or otherwise deliver water or other Water Rights and Assets by any means wherever located;
(g) All guaranties, warranties, marketing, management or service contracts, indemnity agreements, and water right agreements, other water related contracts and water reallocation rights, all insurance policies regarding or relating to any Water Rights and Assets; and
(h) All rents, issues, profits, proceeds and other accounts, instruments, chattel paper, contract rights, general intangibles, deposit accounts, and other rights to payment arising from, or on account of any us, nonuse, sale, lease, transfer or other disposition of any Water Rights and Assets.
The references to “water” and “water rights and assets” are used herein in the broadest and most comprehensive sense of the terms. The term “water” includes water rights and rights to water or whatever rights to money, proceeds, property or other benefits are exchanged or received for or on account of any Water Rights and Assets or any conservation or other nonuse of water, including whatever rights are achieved by depositing shares of any Water Right and Assets in any water bank or with any water authority, or any other water reallocation rights;
(vi) TOGETHER WITH all leasehold estates, rights, titles and interests of Trustor in, to and under all leases, permits, subleases, licenses, franchises and other agreements covering the Premises however characterized, issued or in any way furnished, whether necessary or not for the operation and use of the Premises, including, without limitation, building permits, certificates of occupancy, environmental certificates of operation relating to, the Improvements or any portion thereof now or hereafter existing or entered into, and all rights, titles and interests of Trustor thereunder, including, without limitation, all cash or security deposits, advance rentals, and deposits or payments of similar nature;
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(vii) TOGETHER WITH all right, title and interest now owned or hereafter acquired by Trustor in and to any greater estate in the Premises or the Improvements;
(viii) TOGETHER WITH all the estate, interest, right, title, other claim or demand, both in law and in equity, including, without limitation, claims or demands with respect to the proceeds of insurance in effect with respect to the Premises or the Improvements, which Trustor now has or may hereafter acquire in the Premises or the Improvements, and any and all awards, damages, remunerations, reimbursements, settlements or compensation made by any governmental authority pertaining to any condemnation or other taking by eminent domain, or by any proceeding of purchase in lieu thereof, of any other component of the whole or any part of the Trust Estate (as hereinafter defined), including, without limitation, any awards resulting from a change of grade of streets, awards for severance damages, and all property tax refunds payable with respect to the Trust Estate (as hereinafter defined) (collectively, the “Claims”);
(ix) TOGETHER WITH all right, title and interest now owned or hereafter acquired by Trustor in and to any and all articles of personal property of every kind and nature whatsoever and any additions to, substitutions for, changes in or replacements of the whole or any part thereof, including, without limitation, all goods, fixtures, wall-beds, wall-safes, built-in furniture and installations, shelving, partitions, door-stops, vaults, elevators, dumb-waiters, awnings, window shades, venetian blinds, light fixtures, fire hoses and brackets and boxes for the same, fire sprinklers, alarm systems, drapery rods and brackets, screens, linoleum, carpets, plumbing, laundry tubs and trays, iceboxes, refrigerators, heating units, stoves, ovens, water heaters, incinerators, furniture and furnishings, communication systems, all specifically designed installations and furnishings and all of said articles of property, the specific enumerations herein not excluding the general, now or at any time hereafter affixed to, attached to, placed upon, used or useful in any way in connection with the use, enjoyment, occupancy or operation of the Premises or the Improvements or any portion thereof and owned by Trustor or in which Trustor now has or hereafter acquires an interest, and all building materials, supplies, tools and equipment now or hereafter delivered to the Premises and intended to be installed or placed in or about the Improvements (collectively, the “Personal Property”);
(x) TOGETHER WITH all inventory in all of its forms (except real estate), wherever located, now or hereafter existing, including, but not limited to, (a) all plastic, corrugated and other containers and raw materials and work in progress therefor, finished goods thereof, and materials used or consumed in the manufacture or production thereof, (b) goods in which the Trustor has an interest in mass or a joint or other interest or right or interest of any kind (including, without limitation, goods in which the Trustor has an interest or right as consignee), and (c) goods which are returned to or repossessed by the Trustor, and all accessions thereto and products thereof and documents therefor;
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(xi) TOGETHER WITH all farm products in all of their respective forms, wherever located, now or hereafter existing, to be planted or grown on the Premises (including, but not limited to, crops, nursery stock, root stock, container grown products, seedlings, vines, trees, and other plants or plant products, fertilizers and herbicides), but specifically excluding growing crops, and all accessions to and products of and documents for any of the foregoing;
(xii) TOGETHER WITH all general intangibles relating to design, development, operation, management and use of the Premises and construction of the Improvements, including, but not limited to, (a) all permits, licenses, authorizations, variances, land use entitlements, approvals and consents issued or obtained in connection with the construction of the Improvements, (b) all permits, licenses, approvals, consents, authorizations, franchises and agreements issued or obtained in connection with the use, occupancy or operation of the Premises or the Improvements, (c) all rights as a declarant (or its equivalent) under any covenants, conditions and restrictions or other matters of record affecting the Premises or the Improvements, (d) all materials prepared for filing or filed with any governmental agency, (e) all rights under any contract in connection with the development, design, use, operation, management and construction of the Premises or the Improvements and (f) all books and records prepared and kept in connection with the acquisition, construction, operation and occupancy of the Premises, the Improvements and any other component of the Trust Estate (as hereinafter defined);
(xiii) TOGETHER WITH all construction, service, engineering, consulting, leasing, architectural and other similar contracts of any nature (including, without limitation, those of any general contractors, subcontractors and materialmen), as such may be modified, amended or supplemented from time to time, concerning the design, construction, management, operation, occupancy, use, and/or disposition of any other component of any portion of or all of the Trust Estate (as hereinafter defined);
(xiv) TOGETHER WITH all architectural drawings, plans, surveys, specifications, soil tests and reports, feasibility studies, appraisals, engineering reports and similar materials relating to any portion or all of the Premises and the Improvements;
(xv) TOGETHER WITH all payment and performance bonds or guarantees and any and all modifications and extensions thereof relating to the Premises and the Improvements;
(xvi) TOGETHER WITH all reserves, deferred payments, deposits, refunds, cost savings, letters of credit and payments of any kind relating to the construction, design, development, operation, occupancy, use and disposition of any other component of all or any portion of the Trust Estate (as hereinafter defined), including, without limitation, any property tax rebates now owing or hereafter payable to Trustor;
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(xvii) TOGETHER WITH all proceeds of the Secured Term Loans secured hereby and any commitment by any Lender to extend permanent or additional construction or other financing to Trustor relating to any other component of the Trust Estate (as hereinafter defined);
(xviii) TOGETHER WITH all proceeds and claims arising on account of any damage to or taking of any other component of the Trust Estate (as hereinafter defined) or any part thereof, and all causes of action and recoveries for any loss or diminution in the value of any other component of the Trust Estate (as hereinafter defined);
(xix) TOGETHER WITH all policies of, and proceeds resulting from, insurance relating to any other component of the Trust Estate (as hereinafter defined) or any of the above collateral, and any and all riders, amendments, renewals, supplements or extensions thereof, and all proceeds thereof;
(xx) TOGETHER WITH all deposits made with or other security given to utility companies by Trustor with respect to the Premises and/or the Improvements, and all advance payments of insurance premiums made by Trustor with respect thereto and claims or demands relating to insurance and all deposit accounts wherever located;
(xxi) TOGETHER WITH all shares of stock or other evidence of ownership of any other component of any part of the Trust Estate (as hereinafter defined) that is owned by Trustor in common with others, including all water stock relating to the Premises or the Improvements, if any, and all documents or rights of membership in any owners’ or members’ association or similar group having responsibility for managing or operating any part of the Premises or the Improvements;
(xxii) TOGETHER WITH all proceeds, whether cash, promissory notes, contact rights or otherwise, of the sale or other disposition of all or any part of the estate of Trustor upon the Trust Estate now or hereafter existing thereon, provided, however, the foregoing shall not authorize or entitle Trustor to dispose of the Trust Estate (as hereinafter defined), except as may be permitted pursuant to the Loan Documents;
(xxiii) TOGETHER WITH all sales contracts, escrow agreements and broker’s agreements concerning the sale of any other component of any or all of the Trust Estate (as hereinafter defined);
(xxiv) TOGETHER WITH any and all monies and other property, real or personal which may from time to time be subjected to the lien hereof by Trustor or by anyone on its behalf or with its consent, or which may come into the possession or be subject to the control of Trustee or Beneficiary pursuant to this Deed of Trust, the Credit Agreement, or any other Loan Document, including, without limitation, any protective advances under this Deed of Trust;
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(xxv) TOGETHER WITH all Goods, Accounts, Documents, Instruments, Money, Chattel Paper and General Intangibles, as those terms are defined in the Uniform Commercial Code from time to time in effect in the State of California (“California Commercial Code”) (collectively with the property described in subsections (x) through (xxiv), the “Collateral”).
The security interest granted by Section 1.1 with respect to the property described in subsection (iii) above is intended by Trustor to be subject to the provisions of Article 3 hereof and shall not take priority unless and until the license granted to Beneficiary by Trustor in Article 3 is for any reason deemed to be ineffective, terminated or revoked.
1.2. MINERAL RIGHTS. Trustor hereby assigns and transfers to Beneficiary all damages, royalties and revenue of every kind, nature and description whatsoever that Trustor may be entitled to receive from any Person owning or having or hereafter acquiring a right to the oil, gas or mineral rights and reservations of the Premises, with the right of Beneficiary to receive and receipt therefor, and apply the same to the indebtedness secured hereby either before or after any default hereunder, and Beneficiary may demand, sue for and recover any such payments but shall have no duty to do so.
The entire estate, property and interest hereby conveyed to Trustee in Sections 1.1 and 1.2 of this Article 1(A) may hereafter be collectively referred to as the “Trust Estate.”
1.3. FIXTURE FILING. The personal property in which Beneficiary has a security interest includes goods which are or shall become fixtures on the Premises. This Deed of Trust is intended to serve as a fixture filing pursuant to the terms of Division 9 of the California Commercial Code. The information provided in this Section 1.3 is provided so that this Deed of Trust shall comply with the requirements of the California Commercial Code for a mortgage instrument to be filed as a financing statement. This filing is to be recorded in the real estate records of the county in which the Premises is located. This filing remains in effect as a fixture filing until this Deed of Trust is released or satisfied of record or its effectiveness otherwise terminates as to the Trust Estate. In that regard, the following information is provided:
Names of Debtor: Cadiz Inc., Cadiz Real Estate LLC
and Octagon Partners, LLC
Address of Debtor: See Section 5.5 hereof.
Name of Secured Party: Wells Fargo Bank National Association, as Agent for the Lenders
Address of Secured Party: See Section 5.5 hereof.
Trustor is the owner of a record interest in the real estate concerned. Trustor warrants and agrees that, except as otherwise permitted under the Credit Agreement, there is no financing statement covering the foregoing Collateral, the Premises, the Improvements, the Trust Estate, or any part thereof, on file in any public office.
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1.4. SECURITY AGREEMENT. This Deed of Trust shall also constitute a “security agreement” on personal property within the meaning of the California Commercial Code and other applicable law and with respect to the portions of the Trust Estate that constitute personal property. To this end, subject to Liens permitted by Section 6.2 of the Credit Agreement, Trustor grants to Beneficiary a security interest in such portion of the Trust Estate which constitutes personal property and to the extent that the same may be subject to the California Commercial Code to secure the payment and performance of the Obligations, and agrees that Beneficiary shall have all the rights and remedies of a secured party under the California Commercial Code with respect to such property. Any notice of sale, disposition or other intended action by Beneficiary with respect to such portion of the Trust Estate which constitutes personal property sent to Trustor at least ten (10) days prior to any action under the California Commercial Code shall, except as otherwise provided by applicable law, constitute reasonable notice to Trustor.
1.5. FINANCING STATEMENTS. Trustor shall execute and deliver to Beneficiary such other documents, instruments and further assurances, in each case, in form and substance reasonably satisfactory to Beneficiary (and the Lenders in accordance with the Credit Agreement), as Beneficiary may, from time to time, reasonably consider necessary to create, perfect and preserve Beneficiary’s security interest hereunder. Trustor hereby irrevocably authorizes Beneficiary to cause financing statements (and amendments thereto and continuations thereof) and any such documents, instruments 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.
B. OBLIGATIONS SECURED
1.1. FOR THE PURPOSE OF SECURING, IN SUCH ORDER OF PRIORITY AS BENEFICIARY MAY DETERMINE (collectively, the “Obligations”):
(i) payment and performance in full when due of the Secured Term Loans in the original principal amount of up to $60,000,000.00 and all other “Obligations” (as defined in the Credit Agreement);
(ii) payment of all sums advanced by Beneficiary to protect the Trust Estate, with interest thereon at the lesser of (a) the rate otherwise applicable to the outstanding Secured Term Loans under section 2.4 of the Credit Agreement plus four percent (4%), or (b) the maximum interest rate permitted by applicable law (which rate of interest is hereinafter referred to as the “Agreed Rate”).
(iii) payment of all other sums, with interest thereon, which may hereafter be loaned to Trustor, its partners, or its successors or assigns, by Beneficiary, or its successors or assigns, and all renewals, extensions, modifications, changes or amendments thereto, reciting that they are secured by this Deed of Trust;
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(iv) performance of every obligation, covenant or agreement of Trustor contained herein and all supplements, amendments and modifications thereto and all extensions and renewals thereof;
(v) performance of every obligation, covenant and agreement of Trustor contained in any Loan Document or any agreement now or hereafter executed by Trustor which recites that the obligations thereunder are secured by this Deed of Trust; and
(vi) compliance with and performance of each and every material provision of any declaration of covenants, conditions and restrictions pertaining to the Trust Estate or any portion thereof.
TO PROTECT THE SECURITY OF THIS DEED OF TRUST, TRUSTOR HEREBY COVENANTS AND AGREES AS FOLLOWS;
ARTICLE
II
COVENANTS AND AGREEMENTS OF TRUSTOR
2.1. Authority. Trustor represents and warrants that it is duly authorized and has full corporate power to execute this Deed of Trust and enter into the transactions described herein.
2.2. Payment of Secured Obligations. Trustor shall pay when due the principal of and the interest on the indebtedness as stated in the Credit Agreement; all charges, fees and other sums as provided in the Loan Documents; the principal of and interest on any future advances secured by this Deed of Trust; and the principal of and interest on any other indebtedness secured by this Deed of Trust.
2.3. Fees and Expenses. Trustor shall pay all filing, registration or recording fees and taxes and all expenses incident to the execution, delivery and recording of this Deed of Trust, any mortgage instrument supplemental hereto, any security instrument with respect to such portion of the Trust Estate, any California Commercial Code financing statements and continuation statements, and any instrument of further assurance reasonably required by Trustee or by applicable law to be filed, registered or recorded pursuant to this Deed of Trust.
2.4. Maintenance, Repair, Alterations. Trustor shall keep the Premises and Improvements in good condition and repair; Trustor shall not remove, demolish or substantially alter any material portion of the Improvements (other than in the ordinary course of constructing tenant improvements) except upon the prior written consent of the Beneficiary or as may be required by any law, ordinance, rule, regulation or order of any governmental authority or political subdivision having jurisdiction over the Trust Estate; Trustor shall complete promptly and in a good and workmanlike manner any Improvement which may be now or hereafter constructed on the Premises and promptly restore in like manner any portion of the Improvements which may be damaged or destroyed from any cause whatsoever, and pay when due all claims for labor performed and materials furnished therefor; Trustor shall not initiate or acquiesce in any change of zoning or other land classification without Beneficiary’s prior written consent; Trustor shall comply in all material respects with all laws, ordinances, regulations, covenants, conditions and restrictions now or hereafter affecting the Trust Estate or any part thereof or requiring any alterations or improvements; Trustor shall not commit or permit any waste or deterioration of the Trust Estate, and shall keep and maintain abutting grounds, sidewalks, roads, parking and landscape areas in good and neat order and repair; and Trustor shall not commit, suffer or permit any act to be done in or upon the Trust Estate in violation of any law, ordinance or regulation or of any matter of record affecting the Trust Estate.
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2.5. Required Insurance. Trustor shall procure and maintain or shall cause to be procured and maintained continuously in effect until repayment and performance of all Obligations, policies of insurance in form and amounts and issued by companies, associations or organizations satisfactory to the Lenders covering such casualties, risks, perils, liabilities and other hazards required by Beneficiary, including, without limitation, any insurance required under any of the Loan Documents. All original policies, or certificates thereof, and endorsements and renewals thereof shall be delivered to and retained by Beneficiary unless the Lenders waive this requirement in writing. All policies shall expressly protect or recognize Beneficiary’s interest as required by Beneficiary.
2.6. General Requirements. All policies to be maintained pursuant to Section 2.5 shall (a) be issued by companies with a Best’s Insurance Guide rating of at least A-VII and duly qualified and authorized to do such business in the State of California and approved by the Lenders, (b) provide for severability of interests, (c) provide that an act or omission of one of the named insureds shall not reduce or avoid coverage to the other named insureds, (d) shall be subject to the approval of the Lenders as to the insuring companies, amount, deductibles, content and forms of policies and expiration dates, and (e) provide that it cannot be cancelled or materially modified without ten (10) days, prior written notice to the Lenders. Any policy to be maintained hereunder may be maintained under a so-called “blanket policy” insuring other parties and/or other locations so long as the amount of insurance and type of insurance coverage required to be provided hereunder is not thereby diminished, changed or adversely affected.
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2.7. Delivery of Policies, Payment of Premiums.
(i) At the Lender’s option, all policies of Insurance shall either have attached thereto a lender’s loss payable endorsement for the benefit of Beneficiary in form satisfactory to the Lenders or shall name Beneficiary as an additional insured. At least (10) days prior to the expiration of each required policy, Trustor shall deliver to Beneficiary evidence reasonably satisfactory to the Lenders of the renewal or replacement (and, if payment is due at the same time, evidence of the payment of premium) of such policy continuing insurance in form as required by this Deed of Trust. At least (10) days prior to the date when any premium on each such required policy is due, Trustor shall deliver to the Lenders evidence reasonably satisfactory to Beneficiary of the payment of such premium. All such policies shall contain a provision that, notwithstanding any contrary agreement between Trustor and the insurance company, such policies will not be cancelled, allowed to lapse without renewal, surrendered or materially amended, which term shall include any reduction in the scope or limits of coverage, without at least ten (10) days prior written notice to, and (other than a termination for non-payment) the consent of, the Lenders.
(ii) In the event Trustor fails to provide, maintain, keep in force or deliver to Beneficiary the policies of insurance required by this Deed of Trust or by any Loan Document, Beneficiary may (but shall have no obligation to) procure such insurance or single-interest insurance for such risks covering Beneficiary’s interest, and Trustor will pay all premiums thereon promptly upon demand by Beneficiary, and until such payment is made by Trustor, the amount of all such premiums shall bear interest at the Agreed Rate.
(iii) At any time after a default under any Loan Document, then upon request by Beneficiary, Trustor shall deposit with Beneficiary in monthly installments an amount equal to one-twelfth (1/12) of the estimated aggregate annual insurance premiums on all policies of insurance to be maintained pursuant to this Deed of Trust. In such event Trustor further agrees to cause all bills, statements or other documents relating to the foregoing insurance premiums to be sent or mailed directly to Beneficiary. Upon receipt of such bills, statements or other documents evidencing that a premium for a required policy is then payable, and providing Trustor has deposited sufficient funds with Beneficiary pursuant to this Section 2.7, Beneficiary shall promptly pay such amounts as may be due thereunder out of the funds so deposited with Beneficiary. If at any time and for any reason the funds deposited with Beneficiary are or will be insufficient to pay such amounts as may be then or subsequently due, Beneficiary shall notify Trustor and Trustor shall immediately deposit an amount equal to such deficiency with Beneficiary. Notwithstanding the foregoing, nothing contained herein shall cause Beneficiary to be deemed a trustee of said funds or to be obligated, to pay any amounts in excess of the amount of funds deposited with Beneficiary pursuant to this Section 2.7, nor shall anything contained herein modify the obligation of Trustor set forth in Section 2.5 hereof to maintain and keep such insurance in force at all times. To the extent permitted by law, Beneficiary may commingle said reserve with its own funds and Trustor shall be entitled to no interest thereon.
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2.8. Casualties; Insurance Proceeds. Trustor shall give prompt written notice to Beneficiary after the happening of any casualty to or in connection with the Trust Estate or any part thereof, whether or not covered by insurance. In the event of such casualty, all proceeds of insurance shall be payable to Beneficiary, and Trustor hereby authorizes and directs any affected insurance company to make payment of such proceeds directly to Beneficiary. If Trustor receives any proceeds of insurance resulting from such casualty, Trustor shall promptly pay over such proceeds to Beneficiary. Beneficiary may participate in any proceedings and join Trustor in adjusting, settling or compromising any loss or event of loss covered by insurance, and any such adjustment settlement or compromise shall by subject to obtaining the consent of Beneficiary, which consent shall not be unreasonably withheld. Subject to the next following sentence, in the event of any damage or destruction of the Premises or the Improvements, Beneficiary shall apply all loss proceeds remaining after deduction of all expenses of collection and settlement thereof, including, without limitation, attorneys’ and adjusters’ fees and expenses, to the restoration of the Improvements, upon such conditions as Beneficiary shall reasonably determine (it being expressly agreed that Beneficiary may condition disbursement of such proceeds for restoration upon proof that an amount equal to the sum which Beneficiary is requested to disburse has theretofore been paid by Trustor, or is then due and payable for materials theretofore installed or work theretofore performed upon said property and properly includable in the cost of restoration thereof), and any balance of such proceeds shall be paid over to Trustor. If, notwithstanding the foregoing to the contrary,
(i) any Event of Default or event which with the passage of time or giving of notice or both would constitute an Event of Default (a “Potential Default”) has occurred and, at the time of such damage or destruction or at the time of application of insurance proceeds, is continuing, or
(ii) said loss proceeds are not in Beneficiary’s reasonable judgment, sufficient for restoration of said property, or
(iii) the damage or destruction will, in Beneficiary’s reasonable judgment, materially affect or require a change in the contemplated use or operation of the Improvements or the Premises, then, unless Trustor cures such Potential Default or Trustor provides to Beneficiary reasonable security by depositing with Beneficiary, within five (5) days of demand by Beneficiary, the additional amounts necessary to accomplish restoration, or Beneficiary consents to the contemplated modification or change to the use and operation of the Improvements or the Premises, whichever is applicable,
Beneficiary shall (at the sole and absolute discretion of the Lenders) (a) to apply all or any portion of such proceeds to any of the Obligations in such order as the Lenders may determine, or (b) to apply all or any portion of such proceeds to the restoration of said property, subject to such conditions as the Lenders shall determine, or (c) to deliver all or any portion of such proceeds to Trustor, subject to such conditions as the Lenders shall determine. Nothing herein contained shall be deemed to excuse Trustor from repairing or maintaining the Trust Estate as provided in Section 2.4 hereof or restoring all damage or destruction to the Trust Estate, regardless of whether or not there are insurance proceeds available to Trustor or whether any-such proceeds are sufficient in amount, and the application, or release by Beneficiary of any insurance proceeds shall not cure or waive any default or notice of default under this Deed of Trust or invalidate any act done pursuant to such notice, provided, however, that so long as no Event of Default is then in existence and Beneficiary has applied all or a portion of such proceeds to any of the Obligations (such amount which is applied, the “Applied Proceeds”), Trustor shall have no obligation to repair or restore any damage or destruction to the Trust Estate in an amount equal to the Applied Proceeds, provided, however, further, that Trustor shall not be excused from using any proceeds other than the Applied Proceeds plus any deductible under any applicable insurance policy to repair or restore any damage or destruction, to the Trust Estate.
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2.9. Assignment of Policies Upon Foreclosure. In the event of a foreclosure pursuant to this Deed of Trust or other transfer of title or assignment of the Trust Estate in extinguishment, in whole or in part, of the debt secured hereby, all right, title and interest of Trustor in and to all policies of insurance maintained pursuant to Section 2.5 shall inure to the benefit of and pass to the successor in interest to Trustor or the purchaser or grantee of the Trust Estate.
2.10. Indemnification; Subrogation; Waiver of Offset.
(i) Trustor agrees to indemnify, protect, hold harmless and defend Trustee and Beneficiary from and against any and all losses, liabilities, suits, obligations, fines, damages, judgments, penalties, claims, charges, costs and expenses (including reasonable attorneys’ fees and disbursements) which may be imposed on, incurred or paid by or asserted against Trustee and/or Beneficiary by reason or on account of, or in connection with, (a) any willful misconduct of Trustor, (b) the construction, reconstruction or alteration of the Improvements or the Premises, (c) any negligence of Trustor or any negligence or willful misconduct of any lessee or sublessee of the Premises or the Improvements, or any of their respective agents, contractors, subcontractors, servants, employees, licensees or invitees, or (d) any accident, injury, death or damage to any Person or property occurring in, on or about the Premises or the Improvements or any street, driveway, sidewalk, curb or passageway adjacent thereto, except for the willful misconduct or gross negligence of Trustee or Beneficiary. Any amount payable to Trustee or Beneficiary under this Section 2.10 shall be due and payable within ten (10) days after demand therefor and receipt by Trustor of a statement from Trustee and/or Beneficiary setting forth in reasonable detail the amount claimed and the basis therefor. Trustor’s obligations under this Section 2.10 shall survive the repayment or any other satisfaction of the Obligations and shall not be affected by the absence or unavailability of insurance covering the same or by the failure or refusal of any insurance carrier to perform any obligation on its part under any such policy of insurance. If any claim, action or proceeding is made or brought against Trustee and/or Beneficiary which is subject to the indemnity set forth in this Section 2.10, Trustor shall resist or defend against the same, if necessary in the name of Trustee and/or Beneficiary, by attorneys for Trustor’ s insurance carrier (if the same is covered by insurance) approved by Trustee and/or Beneficiary (as applicable) or otherwise by attorneys retained by Trustor and approved by Trustee and/or Beneficiary (as applicable). Notwithstanding the foregoing, Trustee and Beneficiary, in their discretion, if either or both of them disapprove of the attorneys provided by Trustor or Trustor’s insurance carrier, may engage their own attorneys to resist or defend, or assist therein, and, Trustor shall pay, or, on demand, shall reimburse Trustee and Beneficiary for the payment of the reasonable fees and disbursements of such attorneys.
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(ii) Trustor waives any and all right to claim or recover against Beneficiary, its officers, employees, agents and representatives, for loss of or damage to Trustor, the Trust Estate, Trustor’s property or the property of others under Trustor’s control from any cause insured against or required to be insured against by the provisions of this Deed of Trust,
(iii) All sums payable by Trustor pursuant to this Deed of Trust shall be paid without notice, demand, counterclaim, setoff, deduction or defense and without abatement, suspension, deferment, diminution or reduction, and the obligations and liabilities of Trustor hereunder shall in no way be released, discharged or otherwise affected (except as expressly provided herein) by reason of: (a) any damage to or destruction of or any condemnation or similar taking of the Trust Estate or any part thereof; (b) any restriction or prevention of or interference by any third party with any use of the Trust Estate or any part thereof; (c) any title defect or encumbrance or any eviction from the Premises or the Improvements or any part thereof by title paramount or otherwise; (d) any bankruptcy, insolvency, reorganization, composition, adjustment, dissolution, liquidation or other like proceeding relating to Beneficiary or any guarantor of any secured obligation, or any action taken with respect to this Deed of Trust by any trustee or receiver of Beneficiary, or by any court, in any such proceeding; (e) any claim which Trustor has or might have against Beneficiary; (f) any default or failure on the part of Beneficiary to perform or comply with any of the terms hereof or of any other agreement with Trustor; or (g) any other occurrence whatsoever, whether similar or dissimilar to the foregoing; whether or not Trustor shall have notice or knowledge of any of the foregoing. Except as expressly provided herein, Trustor waives all rights now or hereafter conferred by statute or otherwise to any abatement, suspension, deferment, diminution or reduction of any sum secured hereby and payable by Trustor.
2.11. Hazardous Materials.
(i) Environmental Compliance. Trustor shall keep and maintain (and cause all tenants to keep and maintain) the Trust Estate, including, without limitation, the groundwater on or under the Trust Estate, in compliance with, and shall not cause or permit the Premises to be in violation of, or to require clean up under, any applicable present and future federal, state or local laws, statutes, rules, policies, codes, licenses, permits, orders, approvals, plans, authorizations, ordinances or regulations, now or hereafter in effect, relating to environmental conditions, industrial hygiene, public health and safety, or Hazardous Materials (as defined below) including, without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, 42 U.S.C. Section 9601, et seq., the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq., the Hazardous Materials Transportation Act 49 U.S.C. Section 1801, et seq., the Clean Water Act, 33 U.S.C, Section 1251, et seq., the Clean Air Act, 42 U.S.C. Section 7401, et seq., the Toxic Substances Control Act, 15 U.S.C. Sections 2601 through 2629, the Safe Drinking Water Act, 42 U.S.C. Sections 300f through 300j, and any similar state and local laws and ordinances and the regulations now or hereafter adopted, published and/or promulgated pursuant thereto (collectively, the “Hazardous Materials Laws”).
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(ii) Restrictions On Use. Trustor shall not (and shall take all reasonable efforts to assure that all of its tenants shall not) use, generate, manufacture, treat, handle, refine, produce, process, store, discharge, release, dispose of or allow to exist on, under or about the Trust Estate any flammable explosives, radioactive materials, asbestos, organic compounds known as polychlorinated biphenyls, chemicals known to cause cancer or reproductive toxicity, pollutants, materials containing gasoline, diesel fuel or other petroleum hydrocarbons, contaminants, corrosive, infectious or carcinogenic materials, hazardous wastes, toxic substances or related materials, including, without limitation, any substances defined as or included in the definitions of “hazardous substances,” “hazardous wastes,” “hazardous materials” or “toxic substances” under the Hazardous Materials Laws (collectively, “Hazardous Materials”), except in compliance with applicable Hazardous Materials Laws and in a manner that would not reasonably be expected to require cleanup under any Hazardous Materials Laws. Furthermore, Trustor shall not allow to exist on, under or about the Trust Estate, any underground storage tanks or underground deposits except with respect to the storage of water and then in compliance with all applicable Hazardous Materials Laws and in accordance with the terms of the Credit Agreement.
(iii) Access. Beneficiary shall be entitled, at any reasonable time, to enter upon and inspect the Trust Estate and take any other actions the Lenders reasonably deem necessary to confirm Trustor’s compliance with the obligations and agreements set forth in this Section 2.11.
(iv) Notice to Beneficiary. Trustor shall immediately advise Beneficiary in writing of (a) any and all enforcement, clean up, removal, mitigation or other governmental or regulatory actions instituted, contemplated or threatened pursuant to any Hazardous Materials Laws affecting the Premises; (b) all actual or threatened investigation, inquiry, lawsuit, citation, directive, summons, proceeding, complaint, notice, order, writ, injunction, claims, liens, encumbrances, penalties or fines made or threatened by any third party against Trustor or the Trust Estate relating to damage, contribution, cost recovery, compensation, loss or injury resulting from any Hazardous Materials (the matters set forth in clauses (a) and (b) above are hereinafter referred to as “Hazardous Materials Claims”); (c) any notice or other communication concerning any actual, alleged, suspected or threatened violation of Hazardous Materials Laws, or liability of Trustor for any losses or damages related thereto in connection with any portion of the Premises or Improvements or past or present activities of any Person thereon, including, without limitation, any notice or other communication concerning any Hazardous Materials Claim; (d) Trustor’s discovery of any occurrence or condition on any real property adjoining or in the vicinity of the Premises that could cause the Trust Estate or any part thereof to be classified as “border-zone property” under the provisions of California Health and Safety Code Section 25220, et seq., or any regulation adopted in accordance therewith or which may support a similar claim or cause of action under the Hazardous Materials Laws; and (e) Trustor’s discovery of any occurrence or condition on the Trust Estate or any real property adjoining or in the vicinity of the Premises which could subject the Trustor or the Trust Estate to any restrictions on ownership, occupancy, transferability or use of the Trust Estate under any Hazardous Materials laws. Beneficiary shall have the right to join and participate in, as a party if it so elects, any settlements, remedial actions, legal proceedings or actions initiated in connection with any Hazardous Materials Claims and to have its reasonable attorneys’ fees in connection therewith paid by Trustor.
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(v) Liens. Trustor shall not create or suffer to exist with respect to the Premises or permit any of its agents to create or suffer to exist thereon, any lien, security interest or other charges or encumbrance imposed pursuant to Section 107(f) of the Superfund Amendments and Reauthorization Act of 1986 (42 U.S.C. Section 9607(f)) or any similar state statute or local ordinance.
2.12. Taxes and Impositions.
(i) Trustor shall pay, or cause to be paid prior to delinquency, all real property taxes and assessments, general and special, and all other taxes and assessments of any kind or nature whatsoever, including, without limitation, non-governmental levies or assessments such as maintenance charges, levies or charges resulting from covenants, conditions and restrictions affecting the Trust Estate, which are assessed or imposed upon the Trust Estate, or become due and payable, and which create, may create or appear to create a lien upon the Trust Estate, or any part thereof, or upon any Person, property, equipment or other facility used in the operation or maintenance thereof (all the above collectively hereinafter referred to as “Impositions”); provided, however, that if, by law any such Imposition is payable, or may at the option of the taxpayer be paid, in installments, Trustor may pay the same or cause it to be paid, together with any accrued interest on the unpaid balance of such Imposition, in installments as the same become due and before any fine, penalty, interest or cost may be added thereto for the nonpayment of any such installment and interest.
(ii) If at any time after the date hereof there shall be assessed or imposed (a) a tax or assessment on the Trust Estate in lieu of or in addition to the Impositions payable by Trustor pursuant to subsection 2.12(i), or (b) a license fee, tax or assessment imposed on Beneficiary and measured by or based in whole or in part upon the amount of the outstanding Obligations secured hereby, then all such taxes, assessments or fees shall be deemed to be included within the term “Impositions” as defined in subsection 2.1.2(i) and Trustor shall pay and discharge the same as herein provided with respect to the payment of Impositions. If Trustor fails to pay such Impositions prior to delinquency or if Trustor is prohibited by law from paying such Impositions, Beneficiary may at its option declare all Obligations secured hereby together with all accrued interest thereon, immediately due and payable. Anything to the contrary herein notwithstanding, Trustor shall have no obligation to pay any franchise, estate, inheritance, income, excess profits or similar tax levied on Beneficiary or on interest or other income received by Beneficiary comprising a portion of or in connection with, the Obligations secured hereby.
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(iii) Subject to the provisions of subsection 2.12(iv) and upon request by Beneficiary, Trustor shall deliver to Beneficiary prior to the date upon which any such Imposition is due and payable by Trustor, evidence of payment of such Imposition and within thirty (30) days after the date upon which any such Imposition is due and payable by Trustor, official receipts of the appropriate taxing authority, or other proof satisfactory to the Lenders, evidencing the payment thereof.
(iv) Trustor shall have the right before any delinquency occurs to contest or object to the amount or validity of any such Imposition by appropriate proceedings, but this shall not be deemed or construed in any way as relieving, modifying or extending Trustor’s covenant to pay any such Imposition at the time and in the manner provided in this Section 2.12, unless Trustor has given prior written notice to Beneficiary of Trustor’s intent to so contest or object to an Imposition, and unless, at Beneficiary’s sole option, (a) Trustor shall demonstrate to the Lender’s satisfaction that the proceedings to be initiated by Trustor shall conclusively operate to prevent the sale of the Trust Estate, or any part thereof, to satisfy such Imposition prior to final determination of such proceedings; or (b) Trustor shall furnish a good and sufficient bond or surety as requested by and satisfactory to the Lenders; or (c) Trustor shall demonstrate to the Lender’s satisfaction that Trustor has provided a good and sufficient undertaking as may be required or permitted by law to accomplish a stay of any such sale.
(v) At any time after an Event of Default under any Loan Document, then upon request by Beneficiary, Trustor shall pay to Beneficiary an initial cash reserve in an amount adequate to pay all Impositions for the ensuing tax fiscal year and shall thereafter continue to deposit with Beneficiary, in monthly installments, an amount equal to one-twelfth (1/12) of the sum of the annual Impositions reasonably estimated by Beneficiary, for the purpose of paying the installment of Impositions next due on the Trust Estate (funds deposited for this purpose shall hereinafter be referred to as “Impounds”). In-such event Trustor further agrees to cause all bills, statements or other documents relating to Impositions to be sent or mailed directly to Beneficiary. Upon receipt of such bills, statements or other documents, and providing Trustor has deposited sufficient Impounds with Beneficiary pursuant to this subsection 2.12(v), Beneficiary shall promptly pay such amounts as may be due thereunder out of the Impounds so deposited with Beneficiary. If at any time and for any reason the Impounds deposited with Beneficiary are or will be insufficient to pay such amounts as may then or subsequently be due, Beneficiary may notify Trustor and upon such notice Trustor shall deposit immediately an amount equal to such deficiency with Beneficiary. Notwithstanding the foregoing, nothing contained herein shall cause Beneficiary to be deemed a trustee of said funds or to be obligated to pay any amounts in excess of the amount of funds deposited with Beneficiary pursuant to this subsection 2.12(v). To the extent permitted by law, Beneficiary may commingle Impounds with its own funds and shall not be obligated to pay or allow any interest on any Impounds held by Beneficiary pending disbursement or application hereunder. Beneficiary may reserve for future payment of Impositions such portion of the Impounds as Beneficiary may in its absolute discretion deem proper. Upon an Event of Default, Beneficiary may apply the balance of the Impounds upon any indebtedness or obligation secured hereby in such order as Beneficiary may determine, notwithstanding that said indebtedness or the performance of said obligation may not yet be due according to the terms thereof. Should Trustor fail to deposit with Beneficiary (exclusive of that portion of said payments which has been applied by Beneficiary upon any indebtedness or obligation secured hereby) sums sufficient to fully pay such Impositions at least fifteen (15) days before delinquency thereof, Beneficiary may, at Beneficiary’s election, but without any obligation so to do, advance any amounts required to make up the deficiency, which advances, if any, shall be secured hereby and shall be repayable to Beneficiary as herein elsewhere provided, or at the option of Beneficiary the latter may, without making any advance whatever, apply any Impounds held by it upon any indebtedness or obligation secured hereby in such order as the Lenders may determine, notwithstanding that said indebtedness or the performance of said obligation may not yet be due according to the terms thereof. Should any Event of Default occur, Beneficiary may at any time at Beneficiary’s option, apply any sums or amounts in its hands received pursuant to subsections 2.7(iii) and 2.12(v) hereof, or as rents or income of the Trust Estate or otherwise, to any indebtedness or obligation of the Trustor secured hereby in such manner and order as Beneficiary may elect, notwithstanding said indebtedness or the performance of said obligation may not yet be due according to the terms thereof. The receipt, use or application of any such Impounds paid by Trustor to Beneficiary hereunder shall not be construed to affect the maturity of any indebtedness secured by this Deed of Trust or any of the rights or powers of Beneficiary or Trustee under the terms of the Loan Documents or any of the obligations of Trustor or any guarantor under the Loan Documents.
(vi) Trustor shall not suffer, permit or initiate the joint assessment of any real and personal property which may constitute all or a portion of the Trust Estate or suffer, permit or initiate any other procedure whereby the lien of the real property taxes and the lien of the personal property taxes shall be assessed, levied or charged to the Trust Estate as single lien.
(vii) Trustor shall cause to be furnished to Beneficiary a tax reporting service covering the Trust Estate of the type, duration and with a company satisfactory to the Lenders.
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2.13. Mortgage Tax. In the event of the passage, after the date of this Deed of Trust, of any law deducting from the value of the Trust Estate for the purpose of taxation any lien thereon or changing in any way the laws now in force for the taxation of deeds of trust or debts secured by deeds of trust, or the manner of the collection of any such taxes, so as to affect this Deed of Trust, or imposing payment of the whole or any portion of any taxes, assessments or other similar charges against the Trust Estate upon Beneficiary, the indebtedness secured hereby shall become due and payable at the option of the Lenders within sixty (60) days after delivery of written notice to Trustor; provided, however, that such election by the Lenders shall be ineffective if such law either (a) shall not impose a tax upon the Lenders nor increase any tax now payable by the Lenders, or (b) shall impose a tax upon the Lenders or increase any tax now payable by the Lenders and prior to the due date: (A) Trustor is permitted by law and can become legally obligated to pay such tax or the increased portion thereof (in addition to all interest, additional interest and other charges payable hereunder and under the Loan Documents without exceeding the applicable limits imposed by the usury laws of the State of California); (B) Trustor does pay such tax or increased portion; and (C) Trustor agrees with the Lenders and the Beneficiary in writing to pay, or reimburse the Lenders and the Beneficiary for the payment of, any such tax or increased portion thereof when thereafter levied or assessed against the Trust Estate or any portion thereof. The obligations of Trustor under such agreement shall be secured hereby.
2.14. Utilities. Trustor shall pay when due all utility charges which are Incurred by Trustor for the benefit of the Trust Estate or which may become a charge or lien against the Trust Estate for gas, electricity, water, sewer or any other utility service furnished to the Trust Estate and all other assessments or charges of a similar nature, whether public or private, affecting or related to the Trust Estate or any portion thereof, whether or not such taxes, assessments or charges are or may become liens thereon.
2.15. Actions Affecting Trust Estate. Trustor shall appear in and contest any action or proceeding purporting to affect the security hereof or the rights or powers of Beneficiary or Trustee; and shall pay all costs and expenses, including the cost of evidence of title and reasonable attorneys’ fees, in any such action or proceeding in which Beneficiary or Trustee may appear.
2.16. Actions By Trustee or Beneficiary to Preserve Trust Estate. If Trustor fails to make any payment or to do any act as and in the manner provided in any of the Loan Documents, Beneficiary and/or Trustee, each in its own discretion, without duty or obligation so to do, without releasing Trustor from any obligation, and without notice to or demand upon Trustor, may make or do the same in such manner and to such extent as either may deem necessary to protect the security hereof. In connection therewith (without limiting their general powers, whether conferred herein, in the other Loan Documents, or by law), Beneficiary and Trustee shall have, and are hereby given, the right, but not the obligation, (a) to enter upon and take possession of the Trust Estate; (b) to make additions, alterations, repairs and improvements to the Trust Estate which they or either of them may consider necessary or proper to keep the Trust Estate in good condition and repair; (c) to appear and participate in any action or proceeding affecting or which may affect the security hereof or the rights or powers of Beneficiary or Trustee; (d) to pay, purchase, contest or compromise any encumbrance, claim, charge, lien or debt which in the judgment of either may affect or appears to affect the security of this Deed of Trust or be prior or superior hereto; and (e) in exercising such powers, to pay-necessary expenses, including reasonable attorneys’ fees and costs or other necessary or desirable consultants. Trustor shall, immediately upon demand therefor by Beneficiary and Trustee or either of them, pay to Beneficiary and Trustee an amount equal to all respective costs and expenses incurred by such party in connection with the exercise of the foregoing rights, including, without limitation, costs of evidence of title, court costs, appraisals, surveys and receiver’s, trustee’s and reasonable attorneys’ fees, together with interest thereon from the date of such expenditures at the maximum rate permitted by applicable law.
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2.17. Transfer of Trust Estate by Trustor. Except as otherwise permitted by the Credit Agreement, Trustor shall not transfer all or any portion of the Trust Estate without obtaining the Lenders’s prior written consent, which consent may be withheld in the Lender’s sole and absolute discretion. In order to induce Beneficiary to make the Secured Term Loans secured hereby, Trustor agrees that, in the event of any transfer of the Trust Estate without the prior written consent of the Lenders, the Lenders shall have the absolute right, at their option, without prior demand or notice, to declare all sums secured hereby immediately due and payable. Consent to one such transaction shall not be deemed to be a waiver of any right to require consent to future or successive transactions. The Lenders may grant or deny such consent in its sole discretion and, if consent should be given, any such transfer shall be subject to this Deed of Trust, and any such transferee shall assume all obligations hereunder and agree to be bound by all provisions contained herein. Such assumption shall not, however, release Trustor from any liability thereunder without the prior written consent of the Lenders, As used herein, “transfer” includes the sale, agreement to sell, transfer, conveyance or hypothecation of the Trust Estate, or any portion thereof or interest therein, whether voluntary, involuntary, by operation of law or otherwise, the execution of any installment land sale contract or similar instrument affecting all or a portion of the Trust Estate, or the lease of all or substantially all of the Trust Estate.
2.18. Full Performance Required; Survival of Warranties. All representations, warranties and covenants of Trustor contained in any Loan Documents or incorporated by reference herein, shall survive the execution and delivery of this Deed of Trust and shall remain continuing obligations, warranties and representations of Trustor so long as any portion of the Obligations, secured by this Deed of Trust remains outstanding.
2.19. Preservation of Trust Estate; Further Assurances. Trustor shall do any and all acts which, from the character or use of the Trust Estate, may be reasonably necessary to protect and preserve the lien, the priority of the lien and the security of Beneficiary granted herein, the specific enumerations herein not excluding the general. Without limiting the foregoing, Trustor agrees to execute such documents and take such action as the Lenders shall determine to be necessary or desirable to further evidence, perfect or continue the perfection and/or the priority of the lien and security interest granted by Trustor herein.
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2.20. Compliance With Premises Restrictions. Trustor will faithfully perform each and every covenant to be performed by Trustor under any lien or encumbrance upon or affecting the Trust Estate, including, without limiting the generality hereof, mortgages, deeds of trust, leases, declaration of covenants, easements, conditions and/or restrictions and other agreements which affect the Premises, in law or in equity and never permit the same to go into default. A default or delinquency under any material lien or encumbrance (as determined by the Lenders in their sole and absolute discretion) which is superior to this Deed of Trust (“Superior Lien”) shall automatically and immediately constitute a default under this Deed of Trust. The Lenders are hereby authorized to advance (Third party Beneficiaries have no authority to advance funds), at their option, all sums necessary to keep any Superior Lien in good standing, and all sums so advanced, together with interest thereon at the Agreed Rate permitted by applicable law, shall be repayable to the Lenders as in the case of other advances made by the Lenders hereunder. Trustor agrees that it shall not make any agreement with the holder of any Superior Lien which shall in any way modify, change, alter or extend any of the terms or conditions of such Superior Lien, nor shall Trustor request or accept any future advances under such Superior Lien, without the express written consent of the Lenders.
2.21. Eminent Domain. In the event that any proceeding or action be commenced for the taking of the Trust Estate or any part thereof or interest therein for public or quasi-public use under the power of eminent domain, condemnation or otherwise, or if the same be taken or damaged by reason of any public improvement or condemnation proceeding, or in any other manner, or should Trustor receive any notice or other information regarding such proceeding, action, taking or damage, Trustor shall give prompt written notice thereof to Beneficiary. The Lenders shall be entitled at its option, without regard to the adequacy of its security, to commence, appear in and prosecute in its own name any such action or proceeding. The Lenders shall also be entitled to make any compromise or settlement in connection with such taking or damage. All compensation, awards, damages, rights of action and proceeds awarded to Trustor by reason of any such taking or damage (the “Condemnation Proceeds”) are hereby absolutely and unconditionally assigned to Beneficiary and Trustor agrees to execute such further assignments of the Condemnation Proceeds as the Lenders or Trustee may require. Subject to the next following sentence, after deducting from the Condemnation Proceeds all costs and expenses (regardless of the particular nature thereof and whether incurred with or without suit), including reasonable attorneys’ fees, incurred by Beneficiary in connection with any such action or proceeding, Beneficiary shall apply all such Condemnation Proceeds to the restoration of the Improvements, upon such conditions as the Lenders shall reasonably determine (including, without limitation, those described in Section 2.8 above) and any balance of such proceeds shall be paid over to Trustor. If, notwithstanding the foregoing to the contrary,
(i) any Event of Default or Potential Default has occurred and, at the time of such taking or damage, or at the time of application of the Condemnation Proceeds, is continuing, or
(ii) said loan proceeds are not, in the Lenders’s reasonable judgment, sufficient for restoration of said property, or
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(iii) the damage or destruction will, in the Lender’ s reasonable judgment, materially affect or require a change in the contemplated use or operation of the Improvements, then, unless Trustor cures such Potential Default, or Trustor provides to Beneficiary reasonable security by depositing with Beneficiary, within five (5) days of demand by Beneficiary, the additional amounts necessary to accomplish restoration, or the Lender consents to the contemplated modification or change to the use and operation of the Improvements, whichever is applicable,
Beneficiary shall have the option, acting at the direction of the Lenders, (a) to apply all or any portion of such proceeds to any of the Obligations in such order as the Lenders may determine, or (b) to apply all or any portion of such proceeds to the restoration of said property, subject to such conditions as the Lenders shall determine, or (c) to deliver all or any portion of such proceeds to the Lenders, subject to such conditions as the Lenders shall determine. Application or release of the Condemnation Proceeds as provided herein shall not cure or waive any Event of Default or Potential Default or notice of default hereunder or under any other Loan Document or invalidate any act done pursuant to such notice.
2.22. Additional Security. All right, title and interest of Trustor in and to all extensions, improvements, renewals, substitutes and replacements of the Trust Estate, and all additions and appurtenances thereto, hereafter acquired by or released to Trustor or constructed, assembled or placed by Trustor on the Premises and all conversions of the security constituted thereby, immediately upon such acquisition, release, construction, assembling, placement or conversion, as the case may be, and in each such case, without any further deed of trust, conveyance, assignment or other act by Trustor, shall become subject to the lien of this Deed of Trust, as fully and completely, and with the same effect, as though now owned by Trustor. No other security now existing, or hereafter taken, to secure the obligations secured hereby shall be impaired or affected by the execution of this Deed of Trust, and all additional security shall be taken, considered and held as cumulative. The taking of additional security, execution of partial releases of the security, or any extension of the time of payment of the indebtedness shall not diminish the force, effect or lien of this Deed of Trust and shall not affect or impair the liability at any time holds additional security for any of the obligations secured hereby, it may enforce the sale thereof or otherwise realize upon the same, at its option, either before, concurrently, or after a sale is made hereunder.
2.23. Assignment of Contracts. In addition to any other grant, transfer or assignment effectuated hereby, without in any manner limiting the generality of the grants given above, Trustor shall assign to Beneficiary, as security for the indebtedness secured hereby, Trustor’s interest in all agreements, contracts, leases, licenses and permits affecting the Premises and Improvements in any manner whatsoever, such assignments to be made, if so requested by the Lenders, by instruments in form satisfactory to the Lenders. No such assignment shall be construed as a consent by Beneficiary to any agreement, contract, license or permit so assigned, or to impose upon Beneficiary any obligations with respect thereto.
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2.24. Appointment of Successor Trustee. Beneficiary may, from time to time, by a written instrument executed and acknowledged by Beneficiary, mailed to Trustor and recorded in the county in which the Trust Estate is located and by otherwise complying with the provisions of applicable law, at any time and from time to time, substitute a successor or successors to any Trustee named herein or acting hereunder. The power of appointment of a successor Trustee may be exercised as often as and whenever Beneficiary may choose, and the exercise of the power of appointment, no matter how often, shall not be an exhaustion thereof. Said successor shall, without conveyance from the Trustee predecessor, succeed to all title, estate, rights, powers and duties of said predecessor. Whenever in this Deed of Trust reference is made to Trustee, it shall be construed to mean each Person appointed as Trustee for the time being, whether original or successor in trust.
2.25. Trustee’s Powers. At any time, or from time to time, without liability therefor and without notice, upon written request of Beneficiary and presentation of this Deed of Trust and the Credit Agreement secured hereby and without affecting the personal liability of any Person for payment of the indebtedness secured hereby or the effect of this Deed of Trust upon the remainder of said Trust Estate, Trustee may (a) reconvey any part of said Trust Estate, (b) consent in writing to the making of any map or plat thereof, (c) join in granting any easement thereon, or (d) join in any extension agreement or any agreement subordinating the lien or charge hereof.
2.26. Beneficiary’s Powers. Without affecting the liability of any other Person liable for the payment of any obligation herein mentioned, and without affecting the lien or charge of this Deed of Trust upon any portion of the Trust Estate not then or theretofore released as security for the full amount of all unpaid obligations, Beneficiary (acting at the direction of the Lenders in accordance with the Credit Agreement) may, from time to time and without notice (a) release any Person so liable, (b) extend the maturity or alter any of the terms of any such obligation, (c) grant other indulgences, (d) release or reconvey, or cause to be released or reconveyed at any time at Beneficiary’s option any parcel, portion or all of the Trust Estate, (e) take or release any other or additional security for any obligation herein mentioned, or (f) make compositions or other arrangements with debtors in relation thereto.
2.27. Leases.
(i) Trustor shall provide Beneficiary with true, correct and complete copies of all material Leases, together with such other information relating to the Leases, as the Lenders shall reasonably request. Except as otherwise permitted under the Credit Agreement, Trustor shall not accept prepayments of rent for any period in excess of three (3) months and shall perform all covenants of the lessor under all Leases affecting the Trust Estate. Leases, as used herein, includes any extensions or renewals thereof and any amendments thereto. Trustor shall perform and carry out all of the provisions of the Leases to be performed by Trustor and shall appear in and defend any action in which the validity of any Lease is at issue and commence and maintain any action or proceeding necessary to establish or maintain the validity of any lease and to enforce the provisions thereof,
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(ii) If a leasehold estate constitutes a portion of the Trust Estate, then, except as otherwise permitted under the Credit Agreement, Trustor agrees not to amend, change, terminate or modify such leasehold estate or any interest therein without the prior written consent of the Lenders. Consent to one amendment, change, agreement or modification shall not be deemed to be a waiver of the right to require consent to other, future or successive amendments, changes, agreements or modifications. Trustor agrees to perform all obligations and agreements under said leasehold and shall not take any action or omit to take any action which would affect or permit the termination of said leasehold. Trustor agrees to promptly notify Beneficiary’ in writing with respect to any default or alleged default by any party thereto and to deliver to Beneficiary copies of all notices, demands, complaints or other communications received or given by Trustor with respect to any such default or alleged default. Beneficiary shall have the option to cure any such default and to perform any or all of Trustor’s obligations thereunder. All sums expended by Beneficiary in curing any such default shall be secured hereby and shall be immediately due and payable without demand or notice and shall bear interest from date of expenditure at Agreed Rate.
(iii) Subject to the Credit Agreement and except as otherwise permitted under the Credit Agreement, each Lease of any portion of the Trust Estate shall be absolutely subordinate to the lien of this Deed of Trust, but shall contain a provision satisfactory to the Lenders, and in any event, each tenant thereunder, by virtue of executing a Lease covering the Premises or any portion thereof, hereby agrees, that in the event of the exercise of the private power of sale or a judicial foreclosure hereunder, such Lease, at the option of the purchaser at such sale, shall not be terminated and the tenant thereunder shall attorn to such purchaser and, if requested to do so, shall enter into a new Lease for the balance of the term of such Lease then remaining upon the same terms and conditions. Each such Lease shall, at the request of the Lenders, be assigned to Beneficiary upon the Lender’s approved form, and each, such assignment shall be recorded and acknowledged by the tenant thereunder. Concurrently with the execution of any and all Leases executed after the date hereof, Trustor shall cause the tenants thereunder to execute a subordination, non-disturbance and attornment agreement in favor of Beneficiary in form and substance satisfactory to the Lenders and immediately thereafter deliver such agreement to Beneficiary.
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2.28. Reimbursement; Attorneys’ Fees. Trustor shall pay, within five (5) business days of receiving demand for payment, all sums expended or expenses incurred by Trustee and/or Beneficiary in acting under any of the terms of this Deed of Trust, including, without limitation, any fees and expenses (including reasonable attorneys’ fees) incurred in connection with any reconveyance of the Trust Estate or any portion thereof, or to compel payment of the obligations or any portion of the indebtedness evidenced by the Credit Agreement or Loan Documents or in connection with any default thereunder. Without limiting the generality of the foregoing, upon election of either Beneficiary or Trustee so to do, employment of an attorney is authorized, and payment by Trustor of all reasonable attorneys’ fees, costs and expenses in connection with any action and/or actions (including the cost of evidence or search of title) which may be brought for the foreclosure of this Deed of Trust, and/or for possession of the Trust Estate covered hereby, and/or for the appointment of a receiver, and/or for the enforcement of any covenant or right in this Deed of Trust contained as hereinafter provided, shall be secured hereby. As used herein, the terms “attorneys’ fees” or “attorneys’ fees and costs” shall mean the fees and expenses of counsel to the parties hereto, which may include printing, photostating, duplicating and other expenses, air freight charges, and fees billed for law clerks, paralegals, librarians and others not admitted to the bar but performing services under the supervision of an attorney. The terms “attorneys’ fees” or “attorneys’ fees and costs” shall also include, without limitation, all such fees and expenses incurred with respect to appeals, arbitrations, judicial or nonjudicial foreclosure and bankruptcy proceedings, and whether or not any action or proceeding is brought with respect to the matter for which such fees and expenses were incurred.
2.29. Title. Trustor has good and marketable title to the Trust Estate subject to no lien, charge or encumbrance except as permitted by the Beneficiary in accordance with the terms of the Credit Agreement. This Deed of Trust is and will remain a valid and enforceable lien on the Trust Estate subject only to the exceptions referred to above. Trustor will preserve its interest in and title to the Trust Estate and will forever warrant and defend the same to Trustee and Beneficiary and will forever warrant and defend the validity and priority of the lien hereof against the claims of all persons and parties whomsoever. Trustor shall promptly and completely observe, perform, and discharge each and every obligation, covenant and agreement affecting the Trust Estate whether the same is prior and superior or subject and subordinate hereto including, if the security hereunder is or will be a condominium, community apartment, stock cooperative, or part of a planned development, each and every provision under any declaration of covenants, conditions and restrictions pertaining thereto.
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ARTICLE
III
ASSIGNMENT OF RENTS, ISSUES AND PROFITS
3.1. Assignment to Beneficiary; License. Trustor hereby absolutely and irrevocably grants, sells, assigns, transfers and sets over to Beneficiary all of the Rents derived from any Lease, now existing or hereafter created and affecting all or any portion of the Trust Estate or the use or occupancy thereof, together with (i) all of Trustor’s rights, titles and interests in the Leases including all modifications, amendments, extensions and renewals of the Leases (whether heretofore or hereafter entered into) and all rights and privileges incident thereto; and (ii) all security deposits, guaranties and other security now or hereafter held by Trustor as security for the performance of the obligations of the tenants under the Leases. This assignment of rents is intended by Trustor and Beneficiary to create and shall be construed to create an absolute assignment to Beneficiary of all of Trustor’s rights, titles and interests in the Rents and in the Leases and shall not be deemed an assignment for additional security for the Obligations. Trustor irrevocably appoints Beneficiary its true and lawful attorney, at the option of Beneficiary at any time, to demand, receive and enforce payment, to give receipts, releases and satisfactions, and to sue, either in the name of the of Trustor or in the name Beneficiary, for all such income, rents, issues, deposits, profits and proceeds and apply the same to the indebtedness secured hereby. Trustor and Beneficiary further agree that, during the term of this assignment the Rents shall not constitute property of Trustor (or of any estate of Trustor) within the meaning of 11 U.S.C. §541, as amended from time to time. By its acceptance of this assignment and so long as an Event of Default shall not have occurred and be continuing under the Loan Documents, Beneficiary hereby grants to Trustor a revocable license to enforce the Leases, to collect the Rents, to apply the Rents to the payment of the costs and expenses incurred in connection with the development, construction, operation, maintenance, repair and restoration of the Trust Estate and to any indebtedness secured thereby and to distribute the balance, if any, to Trustor as may be permitted by the terms of the Loan Documents.
3.1. Revocation of License. Upon the occurrence of an Event of Default and at any time thereafter during the continuance thereof, Beneficiary shall have the right to revoke the license granted to Trustor hereby by giving written notice of such revocation to Trustor. Upon such revocation, Trustor shall promptly deliver to Beneficiary the original copies of all Leases and all Rents then held by Trustor and Beneficiary shall thereafter be entitled to enforce the Leases, to collect and receive, without deduction or offset, all Rents payable thereunder, including but not limited to, all Rests which were accrued and unpaid as of the date of such revocation and to apply such Rents as provided in the Loan Documents. Trustor hereby irrevocably constitutes and appoints Beneficiary its true and lawful attorney-in-fact to enforce, in Trustor’s name or in Beneficiary’s name or otherwise, all rights of Trustor in the instruments, including without limitation checks and money orders, tendered as payments of Rents and to do any and all things necessary and proper to carry out the purposes hereof
3.2. Election of Remedies. Upon the occurrence of an Event of Default hereunder, Beneficiary may, at its option, exercise (or cause the Trustee to exercise) its rights hereunder. If Beneficiary elects to exercise its rights hereunder, Beneficiary or Trustee may, at any time without notice, either in person, by agent or by a receiver appointed by a court, enter upon and take possession of all or any portion of the Trust Estate, enforce all Leases, collect all Rents, including those past due and unpaid, and apply the same to the costs and expenses of operation and collection, including, without limitation, reasonable attorneys’ fees, and to any indebtedness then secured hereby, in such order as Beneficiary may determine. In connection with the exercise by Beneficiary of its rights hereunder, Trustor agrees that Beneficiary shall have the right to specifically enforce such rights and to obtain the appointment of a receiver in accordance with the provisions of Section 4.2 hereof without regard to the value of the Trust Estate or the adequacy of any security for the Obligations then secured hereby. The collection of such Rents, or the entering upon and taking possession of the Trust Estate, or the application thereof as aforesaid, shall not cure or waive any default or notice of default hereunder or invalidate any act done in response to such default or pursuant to such notice of default.
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ARTICLE
IV
EVENTS OF DEFAULT AND REMEDIES
4.1. Events of Default. The occurrence of any one or more of the following shall constitute an “Event of Default” under this Deed of Trust:
(a) failure to pay any monies, obligations or other consideration when due under the Credit Agreement, this Deed of Trust or any other Loan Document, subject to any applicable notice and cure period;
(b) except with respect to the payment of monies or the specific items set forth in this Section 4.1, failure to comply with, perform or observe any of the covenants made by Trustor in this Deed of Trust and such failure continues for more than thirty (30) days following Trustor’s receipt of notice of default (provided, however, if the breach is not reasonably capable of cure within such thirty (30) day period, Trustor shall not be in default of this Deed of Trust if Trustor (i) promptly commences to cure the breach within the thirty (30) day period, (ii) diligently and in good faith continues to cure the breach, and (3) cures such breach within ninety (90) days of the notice of default);
(c) failure to comply with, perform or observe any obligation or condition of any of the other Loan Documents within the time periods specified therein and the expiration of any applicable notice and cure period set forth thereunder, if any;
(d) any representation, warranty, statement, certificate, schedule or report furnished by Trustor under or in connection with the Loan Documents, whether given hereunder or any other Loan Document or otherwise, shall prove to have been inaccurate in any material respect on or as of the date deemed made;
(e) the occurrence of a default under Section 7 of the Credit Agreement, subject to any applicable notice and cure period thereunder.
(f) failure to procure or maintain any insurance policies which are determined to be material, as determined by Beneficiary in its sole and absolute discretion;
(g) if Trustor violates or does not comply with any of the provisions of subsection 5.4(ii) hereof;
(h) a default occurs under any of the other Loan Documents and such default is not cured within the applicable notice and cure period, if any; or
(i) if the Premises or Improvements become subject to any lien, other than a lien permitted pursuant to Section 6.2 of the Credit Agreement.
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4.2. Remedies. Upon the occurrence of any Event of Default, Trustee and Beneficiary shall have the following rights and remedies:
(i) Beneficiary may declare the entire principal amount then outstanding (if not then due and payable) pursuant to the Credit Agreement, and accrued but unpaid interest thereon, to be due and payable immediately, and, notwithstanding the stated maturity in the Credit Agreement or any other term or provision of the Loan Documents or this Deed of Trust to the contrary, the outstanding principal amount of the Loan Documents and the accrued but unpaid interest thereon shall become and be immediately due and payable.
(ii) Irrespective of whether Beneficiary exercises the option provided in Section 4.2(i) above, Beneficiary in person or by agent may, without any obligation so to do and without notice or demand upon Trustor and without releasing Trustor from any obligation hereunder: (a) make any payment or do any act which Trustor has failed to make or do; (b) enter upon, take possession of, manage and operate the Trust Estate or any part thereof; (c) make or enforce, or, if the same be subject to modification or cancellation, modify or cancel any Leases of the Trust Estate or any part thereof upon such terms or conditions as Beneficiary deems proper; (d) obtain and evict tenants, and fix or modify rents, make repairs and alterations and do any acts which Beneficiary deems proper to protect the security hereof; and (e) with or without taking possession, in its own name or in the name of Trustor, sue for or otherwise collect and receive rents, royalties, issues, profits, revenue, income and other benefits, including those past due and unpaid, and apply the same less costs and expenses of operation and collection, including reasonable attorneys’ fees, upon any indebtedness secured hereby, and in such order as Beneficiary may determine. Upon request of Beneficiary, Trustor shall assemble and make available to Beneficiary at the Premises any of the Trust Estate which has been removed therefrom. The entering upon and taking possession of the Trust Estate, the collection of any rents, royalties, issues, profits, revenue, income or other benefits and the application thereof as aforesaid shall not cure or waive any default theretofore or thereafter occurring or affect any notice of default hereunder or invalidate any act done pursuant to any such notice; and, notwithstanding continuance in possession of the Trust Estate, or any part thereof, by Beneficiary, Trustee or a receiver, and the collection, receipt and application of rents, royalties, issues, profits, revenue, income or other benefits, Beneficiary shall be entitled to exercise every right provided for in this Deed of Trust or by law upon or after the occurrence of an Event of Default, including the right to exercise the power of sale. Any of the actions referred to in this Section 4.2(ii) may be taken by Beneficiary, either in person or by agent, with or without bringing any action or proceeding, or by a receiver appointed by a court, and any such action may also be taken irrespective of whether any notice of default or election to sell has been given hereunder and without regard to the adequacy of the security for the indebtedness hereby secured. Further, Beneficiary, at the expense of Trustor, either by purchase, repair or construction, may from time to time maintain and restore the Trust Estate or any part thereof and complete construction of the Improvements uncompleted as of the date thereof and in the course of such, completion may make such changes in the contemplated Improvements as Beneficiary may deem desirable and may insure the same.
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(iii) Beneficiary shall be entitled, without notice and to the full extent provided by law, to the appointment by a court having jurisdiction of a receiver to take possession of and protect the Trust Estate or any part thereof, and operate the same and collect the Rents.
(iv) Beneficiary may bring an action in any court of competent jurisdiction to foreclose this Deed of Trust or enforce any of the terms, covenants and conditions hereof or contained in any other Loan Document.
(v) Beneficiary may elect to cause the Trust Estate or any part or parts thereof to be sold as follows:
(a) Beneficiary may proceed as if all of the Trust Estate were real property in accordance with subparagraph (d) below, or Beneficiary may elect to treat any of the Trust Estate which consists of a right in action or which is property that can be severed from the Premises or the Improvements without causing structural damage thereto as if the same were personal property, and dispose of the same in, accordance with subparagraph (c) below, separate and apart from the sale of real property, the remainder of the Trust Estate being treated as real property.
(b) Beneficiary may cause any such sale or other disposition to be conducted immediately following the expiration of any grace period herein provided (or immediately upon the expiration of any redemption or reinstatement period required by law) or Beneficiary may delay any such sale or other disposition for such period of time as Beneficiary deems to be in its best interest. Should Beneficiary desire that more than one (1) such sale or other disposition be conducted, Beneficiary may, at its option, cause the same to be conducted simultaneously, or successively, on the same day, or at such different days or times and in such order as the Lenders may deem to be in their best interest.
(c) Should Beneficiary elect to cause any of the Trust Estate to be disposed of as personal property as permitted by subparagraph (a) above, it may dispose of any part thereof in any manner now or hereafter permitted by the California Commercial Code, the commercial code of the state in which any of the Trust Estate is located or in accordance with any other remedy provided by law. Any such disposition may be conducted by an employee or agent of Beneficiary or Trustee. Both Trustor and Beneficiary shall be eligible to purchase any part or all of such property at any such disposition. Any such disposition may be either public or private as Beneficiary may elect, subject to the provisions of the California Commercial Code or the commercial code of the state in which any of the Trust Estate is located. Beneficiary shall have all of the rights and remedies of a Secured Party under the California Commercial Code or the commercial code of the state in which any of the Trust Estate is located. Expenses of retaking, holding, preparing for sale, selling or the like shall include Beneficiary’s reasonable attorneys’ fees and legal expenses, and upon such default, Trustor, upon demand of Beneficiary, shall assemble such personal property and make it available to Beneficiary at the Premises, a place which is hereby deemed reasonably convenient to Beneficiary and Trustor. Beneficiary shall give Trustor at least five (5) days’ prior written notice of the time and place of any public sale or other disposition of such property or of the time at or after which any private sale or any other intended disposition is to be made, and if such notice is sent to Trustor, in the manner provided for the mailing of notices herein, it shall constitute reasonable notice to Trustor.
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(d) Should Beneficiary elect or be directed to sell the Trust Estate or any part thereof which is real property or which Beneficiary has elected to treat as real property, upon such election, Beneficiary or Trustee shall give such notice of default election to sell as may then be required by law and by any Loan Document. Thereafter, upon the expiration of such time and the giving of such notice of sale as may then be required by law, and without the necessity of any demand on Trustor, Trustee, at the time and place specified in the notice of sale, shall sell the Trust Estate, or any portion thereof specified by Beneficiary, at public auction to the highest bidder for cash in lawful money of the United States or any other form of consideration acceptable to Beneficiary, subject, however, to the provisions of Section 4.2(vii). Trustee may, and upon request of Beneficiary shall, from time to time postpone the sale of all or any portion of the Trust Estate by public announcement at the time and place of such sale, and from time to time thereafter may postpone such sale by public announcement at the time fixed by the preceding postponement or subsequently noticed sale, and without further notice make such sale at the time fixed by the last postponement, or may, in its discretion, give a new notice of sale. If the Trust Estate consists of several lots or parcels, Beneficiary may direct that the same be sold as a unit or be sold separately and, if to be sold separately, Beneficiary may designate the order in which such lots or parcels shall be offered for sale or sold. Any Person, including Trustor, Trustee or Beneficiary, may purchase at the sale. Upon any sale, Trustee shall execute and deliver to the purchaser or purchasers a deed or deeds conveying the property so sold, but without any covenant or warranty whatsoever, express or implied, whereupon such purchaser or purchasers shall be let into immediate possession.
(e) Beneficiary, from time to time before any Trustee’s sale as provided herein, may rescind any notice of default and election to sell or notice of sale by executing and delivering to Trustee a written notice of such rescission, which such notice, when recorded, shall constitute a cancellation of any prior declaration of default and demand for sale. The exercise by Beneficiary of such right of rescission shall not constitute a waiver of any breach or default then existing or subsequently occurring, or impair the right of Beneficiary to execute and deliver to Trustee, as above provided, other declarations or notices of default and demand for sale of the Trust Estate to satisfy the obligations hereof, nor otherwise affect any provision, covenant or condition of any Loan Document.
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(f) In the event of a sale or other disposition of the Trust Estate, or any part thereof, and the execution of a deed or other conveyance pursuant thereto, the recitals therein offsets, such as default, the giving of notice of default and notice of sale, demand that such sale should be made, postponement of sale, terms of sale, sale, purchase, payment of purchase money and other facts affecting the regularity or validity of such sale or disposition, shall be conclusive proof of the truth of such facts and any such deed or conveyance shall be conclusive against all persons as to such facts recited therein.
(g) The acknowledgment of the receipt of the purchase money, contained in any deed or conveyance executed as aforesaid, shall be sufficient discharge to the grantee of all obligations to see to the proper application of the consideration therefor as hereinafter provided. The purchaser at any trustee’s or foreclosure sale hereunder may disaffirm any easement granted or rental or lease contract made in violation of any provision of this Deed of Trust and may take immediate possession of the Trust Estate free from, and despite the terms of, such grant of easement and rental or lease contract.
(h) Upon the completion of any sale or sales made by Trustee or Beneficiary, as the case may be, under or by virtue of this Article 4, Trustee or any officer of any court empowered to do so, shall execute and deliver to the accepted purchaser or purchasers a good and sufficient instrument, or good and sufficient instruments, conveying, assigning and transferring all estate, right, title and interest in and to the property and rights sold. Trustee is hereby irrevocably appointed the true and lawful attorney-in-fact of Trustor in its name and stead to make all necessary conveyances, assignments, transfers and deliveries of the Trust Estate or any part thereof and the rights so sold and for that purpose Trustee may execute all necessary instruments of conveyance, assignment and transfer, and may substitute one or more persons with like power, Trustor hereby ratifying and confirming all that its said attorney or any substitute or substitutes shall lawfully do by virtue hereof. Nevertheless, Trustor, if so requested by Trustee or Beneficiary, shall ratify and confirm any such sale or sales by executing and delivering to Trustee or to such purchaser or purchasers all such instruments as may be advisable in the judgment of Trustee or Beneficiary, for the purpose as may be designated in such request. The foregoing power of attorney is coupled with an interest and cannot be revoked. Any such sale or sales made under or by virtue of this Article 4, whether made under the power of sale herein granted or under or by virtue of judicial proceedings or of a judgment or decree of foreclosure and sale, shall operate to divest all of the estate, right, title, interest, claim and demand whatsoever, whether at law or in equity, of Trustor in and to the properties and rights so sold, and shall be a perpetual bar, both at law and in equity, against Trustor and any and all persons claiming or who may claim the same, or any part thereof, from, through or under Trustor.
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(i) Trustor hereby expressly waives any right which it may have to direct the order in which any of the Trust Estate shall be sold in the event of any sale or sales pursuant hereto.
(vi) The purchase money, proceeds or avails of any sale made under or by virtue of this Article 4, together with all other sums which may then be held by Trustee or Beneficiary under this Deed of Trust, whether under the provisions of this Article 4, or otherwise, shall be applied as follows:
FIRST: To the payment of the costs and expenses of the sale, including reasonable compensation to Trustee and Beneficiary, their agents and counsel, and of any judicial proceedings wherein the same may be made and to the payment of all expenses, liabilities and advances made or incurred by Trustee under this Deed of Trust, together with interest as specified in the Credit Agreement on all advances made by Trustee and all taxes or assessments, except for any taxes, assessments or other charges subject to which the Trust Estate shall have been sold, and further including all costs of publishing, recording, mailing and posting notice, the cost of any search and/or other evidence of title procured in connection therewith and the cost of any revenue stamps on any deed of conveyance.
SECOND: To the payment of any and all sums expended under the terms hereof, not then repaid, with accrued interest as specified in the Credit Agreement and all other sums required to be paid by Trustor pursuant to any provisions of this Deed of Trust or of the Credit Agreement or of any other Loan Document, including all expenses, liabilities and advances made or incurred by Beneficiary under this Trust Estate or in connection with the enforcement hereof, together with interest as specified in the Credit Agreement on all advances.
THIRD: To the payment of the principal and interest then due, owing and unpaid upon the Credit Agreement, with interest on the unpaid principal as specified therein from the due date of any such payment of principal until the same is paid.
FOURTH: The remainder, if any, to the Person or Persons legally entitled thereto.
(vii) Upon any sale or sales made under or by virtue of this Article 4, whether made under the power of sale herein granted or under or by virtue of judicial proceedings or of a judgment or decree of foreclosure and sale, Beneficiary may bid for and acquire the Trust Estate or any part thereof and, in lieu of paying cash therefor, may make settlement for the purchase price by crediting upon the indebtedness or other sums secured by this Deed of Trust the net sales price after deducting therefrom the expenses of sale and the costs of the judicial proceedings, if any, and any other sums which Trustee or Beneficiary is authorized to deduct under this Deed of Trust or the Loan Documents, and, in such event, this Deed of Trust, the Loan Documents and documents evidencing expenditures secured hereby shall be presented to the Person or Persons conducting the sale in order that the amount so used or applied may be credited upon said indebtedness as having been paid.
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(viii) Upon the occurrence of any Event of Default and upon written demand by Beneficiary, Trustor will pay to Beneficiary the entire principal then outstanding, and all accrued but unpaid interest thereon, and, after the happening of said Event of Default, will also pay to Beneficiary interest as specified in the Credit Agreement on the then unpaid principal, and the sums required to be paid by Trustor pursuant to any provision of this Deed of Trust, or any other Loan Document and in addition thereto such further amount as shall be sufficient to cover the costs and expenses of collection, including reasonable compensation to Trustee and Beneficiary hereunder. In the event Trustor shall fail forthwith to pay such amounts upon such demand, Beneficiary shall be entitled and empowered to institute such action or proceedings at law or in equity as may be advised by its counsel for the collection of the sums so due and unpaid, and may prosecute any such action or proceedings to judgment or final decree, and may enforce any such judgment or final decree against Trustor and collect, out of the property of Trustor wherever situated, as well as out of the Trust Estate, in any manner provided by law, moneys adjudged or decreed to be payable.
(a) Beneficiary shall be entitled to recover judgment as aforesaid either before or after or during the pendency of any proceedings for the enforcement of the provisions of this Deed of Trust, and the right of Beneficiary to recover such judgment shall not be affected by any entry or sale hereunder, or by the exercise of any other right, power or remedy for the enforcement of the provisions of this Deed of Trust, or the foreclosure of the lien hereof; and in the event of a sale of the Trust Estate, and of the application of the proceeds of sale, as in this Deed of Trust provided, to the payment of the debt hereby secured, Beneficiary shall be entitled to enforce payment of, and to receive all amounts then remaining due and to enforce payment of all other charges, payments and costs due under this Deed of Trust, and shall be entitled to recover judgment for any portion of the debt remaining unpaid, with interest. In case of proceedings against Trustor in insolvency or bankruptcy or any proceedings for the reorganization of Trustor or involving the liquidation of its assets, Beneficiary shall be entitled to prove the whole amount of principal and interest due pursuant to the Loan Documents to the full amount thereof, and all other payments, charges and costs due under this Deed of Trust or any other Loan Document.
(b) No recovery of any judgment by Beneficiary and no levy of an execution under any judgment upon the Trust Estate or upon any other property of Trustor shall affect, in any manner or to any extent, the lien of this Deed of Trust upon the Trust Estate or any part thereof, or any liens, rights, powers, or remedies of Trustee or Beneficiary hereunder, but such liens, rights, powers and remedies of Trustee and Beneficiary shall continue unimpaired as before.
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(c) Any moneys thus collected by Beneficiary under this Section 4.2(viii) shall be applied by Beneficiary in accordance with the provisions of Section 4.2 (vi).
(ix) Upon the commencement of any action, suit or other legal proceedings by Beneficiary to obtain judgment for the principal of, or interest on sums required to be paid by Trustor pursuant to any provision of this Deed of Trust, or of any other nature in aid of the enforcement of the Loan Documents or of this Deed of Trust, Trustor, to the fullest extent permitted by law, will and does hereby (a) waive the issuance and service of process and enter its voluntary appearance in such action, suit or proceedings, and (b) if required by Beneficiary, consent to the appointment of a receiver or receivers of the Trust Estate and of all the Rents. After the happening of any Event of Default, or upon the commencement of any proceedings to foreclose this Deed of Trust or to enforce the specific performance hereof or in aid thereof or upon the commencement of any other judicial proceedings to enforce any right of Trustee or Beneficiary, Trustee or Beneficiary shall be entitled forthwith, as a matter of right, if either shall so elect, without the giving of notice to any other party and without regard to the adequacy of the security of the Trust Estate, either before or after declaring the unpaid principal of the Loan Documents to be due and payable, to the appointment of such a receiver or receivers.
(x) Notwithstanding the appointment of any receiver, liquidator or trustee of Trustor, or of any of its property, or of the Trust Estate or any part thereof, Trustee and Beneficiary shall be entitled to retain possession and control of all property now or hereafter held under this Deed of Trust, including, but not limited to, the Rents.
(xi) No remedy herein conferred upon or reserved to Trustee or Beneficiary is intended to be exclusive of any other remedy herein or by any Loan Document or by law provided, but each shall be cumulative and shall be in addition to every other remedy given hereunder or by and Loan Document or now or hereafter existing at law or in equity or by statute. No delay or omission of Trustee or Beneficiary in exercising any right or power accruing upon any Event of Default shall impair any right or power or shall be construed to be a waiver of any Event of Default or any acquiescence therein; and every power and remedy given by this Deed of Trust to Trustee or Beneficiary may be exercised from time to time as often as may be deemed expedient by Trustee or Beneficiary. If there exists additional security for the performance of the obligations secured hereby, Beneficiary, or its assigns, at its sole option, and without limiting or affecting any of the rights or remedies hereunder, may exercise any of the rights and remedies to which it may be entitled hereunder either concurrently with whatever rights it may have in connection with such, other security or in such order as it may determine. Nothing in this Deed of Trust or any other Loan Documents shall affect the obligation of Trustor to pay the principal of, and interest as specified in the Credit Agreement in the manner and at the time and place therein respectively expressed.
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(xii) To the fullest extent permitted by applicable law, Trustor will not at any time insist upon, or plead, or in any manner whatsoever claim or take any benefit or advantage of any stay or extension or moratorium law or law pertaining to the marshaling of assets, the administration of estates of decedents, any exemption from execution or sale of the Trust Estate or any part thereof, including exemption of homestead, wherever enacted, now or at any time hereafter in force, which may affect the covenants and terms of performance of this Deed of Trust, nor claim, take or insist upon any benefit or advantage of any law now or hereafter in force providing for the valuation or appraisal of the Trust Estate, or any part thereof, prior to any sale or sales thereof which may be made pursuant to any provision herein, or pursuant to the decree, judgment or order of any court of competent jurisdiction; nor after any such sale or sales, claim or exercise any right under any statute heretofore or hereafter enacted to redeem the property so sold or any part thereof, and Trustor hereby expressly waives all benefit or advantage of any such law or laws, and covenants not to hinder, delay or impede the execution of any power herein granted or delegated to Trustee or Beneficiary, but to suffer and permit the execution of every power as though no such law or laws had been made or enacted. Trustor, for itself and all who claim under it, hereby waives, to the extent that it lawfully may, all right to have the Trust Estate marshaled upon any sale or foreclosure hereunder.
(xiii) Upon the occurrence of any Event of Default and pending the exercise by Trustee or Beneficiary or their agents or attorneys of their right to exclude Trustor from all or any part of the Trust Estate, Trustor agrees to vacate and surrender possession of the Trust Estate to Trustee or Beneficiary, as the case may be, or to a receiver, if any, and in default thereof may be evicted by any summary action or proceeding for the recovery of possession of leased premises for nonpayment of rent, however designated.
(xiv) In the event ownership of the Trust Estate or any portion thereof becomes vested in a Person other than the Trustor herein named, Beneficiary may, without notice to the Trustor herein named, whether or not Beneficiary has given written consent to such change in ownership, deal with such successor or successors in interest with reference to this Deed of Trust and the indebtedness secured hereby, and in the same manner as with the Trustor herein named, without in any way vitiating or discharging Trustor’s liability hereunder or for the indebtedness or obligations hereby secured.
(xv) In the event that there be a Trustee’s sale hereunder and if at the time of such sale Trustor, or its heir, executor, administrator or assign, be occupying the Premises and Improvements or any part thereof so sold, each and all shall immediately become the tenant of the purchaser at such sale, which tenancy shall be a tenancy from day to day, terminable at the will of either tenant or landlord, at a reasonable rental per day based upon the value of the Premises and Improvements, such rental to be due daily to the purchaser. An action of unlawful detainer shall lie if the tenant holds over after a demand in writing for possession of said Premises and Improvements; and this agreement and the Trustee’s deed shall constitute a lease and agreement under which any such tenant’s possession arose and continued.
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(xvi) Trustor shall pay immediately, without notice or demand, all costs and expenses in connection with the enforcement of Beneficiary’s rights under any of the Loan Documents, including, without limitation, reasonable attorneys’ fees, whether or not any suit is filed in connection with such enforcement; such costs and expenses shall include, without limitation, all costs, reasonable attorneys’ fees and expenses in connection with any insolvency, bankruptcy, reorganization, arrangement or other similar proceedings involving Trustor or Trustor’ s obligations under any Loan Document, which in any way affects the exercise by Beneficiary of its rights and remedies under the Deed of Trust or any other Loan Document.
4.3. Avoidance of Lock-Out Period. Following an Event of Default, if Trustor or anyone on Trustor’s behalf makes a tender of payment of the amount necessary to satisfy the Obligations secured by this Deed of Trust at any time prior to a foreclosure sale (including, but not limited to, sale under power of sale under this Deed of Trust), or during any redemption period after foreclosure and such tender of payment as of the date tendered will constitute a prepayment not permitted by Section 2.3 of the Credit Agreement, then, to the maximum extent permitted by law, Trustor shall pay Beneficiary, in addition to such tender payment, an amount equal to the greater of (i) three percent (3%) of all outstanding principal and interest amounts owed under or in connection with the Credit Agreement and (ii) an amount equal to the excess of (A) the sum of the present values of a series of payments payable at the times and in the amounts equal to the payments of principal and interest (including, but not limited to the principal and interest payable on the Maturity Date) which would have been scheduled to be payable after the date of such tender under the Credit Agreement had the Obligations not been accelerated, with each such payment discounted to its present value at the date of such tender at the rate which when compounded monthly is equivalent to the Prepayment Rate (as hereinafter defined), over (B) the then principal amount due under the Credit Agreement.
The term “Prepayment Rate” means the bond equivalent yield (in the secondary market) on the United States Treasury Security that as of the Prepayment Rate Determination Date (hereinafter defined) has a remaining term to maturity closest to, but not exceeding, the remaining term to the Maturity Date, as most recently published in the “Treasury Bonds, Notes and Bills” section in The Wall Street Journal as of the date of the related tender of payment. If more than one issue of United States Treasury Securities has the remaining term to the Maturity Date referred to above, the “Prepayment Rate” shall be the yield on the United States Treasury Security most recently issued as of such date. The term “Prepayment Rate Determination Date” shall mean the date which is five (5) Business Days prior to the prepayment date. The rate so published shall control absent manifest error. As used herein, “Business Day” shall mean any day other than Saturday, Sunday or any other day on which bank are required or authorized to close in California.
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ARTICLE
V
MISCELLANEOUS
5.1. Amendments. This Deed of Trust may only be waived, changed, discharged or terminated by an instrument in writing signed by the party against whom enforcement of any waiver, change, discharge or termination is sought
5.2. No Waiver. By accepting payment of any sum secured hereby after its due date or in an amount less than the sum due, Beneficiary does not waive its rights either to require prompt payment when due of all other sums so secured or to declare a default as herein provided for failure to pay the total sum due.
5.3. Trustor Waiver of Rights. Trustor waives to the extent permitted by law, (i) the benefit of all laws now existing or that may hereafter be enacted providing for any appraisement before sale of any portion of the Trust Estate, (ii) all rights of redemption, valuation, appraisement, stay of execution, notice of election to mature or declare due the whole of the secured indebtedness and marshalling in the event of foreclosure of the liens hereby created, and (iii) all rights and remedies which Trustor may have or be able to assert by reason of the laws of the State of California pertaining to the rights and remedies of sureties; provided, however, nothing contained herein shall be deemed to be a waiver of Trustor’s rights under Section 2924c of the California Civil Code.
5.4. Environmental Matters.
(i) Trustor agrees to submit from time to time, if requested by Beneficiary, a report, satisfactory to Beneficiary, certifying that the Premises and the Improvements are not now being used nor been used in the past for any use, generation, transportation, treatment, storage or disposal of any Hazardous Materials at any time located on or present or under or near the Premises. Beneficiary reserves the right, in its sole and absolute discretion, to retain, at Trustor’s expense, an independent professional consultant to review any report prepared by Trustor and/or to conduct its own investigation of the Premises and Improvements for Hazardous Materials. Trustor hereby grants to Beneficiary, its agents, employees, consultants and contractors the right to enter upon the Premises and Improvements and to perform such tests as are reasonably necessary to conduct such a review and/or investigation.
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(ii) Upon the discovery by Trustor of any event or situation which would render any of the representations, warranties or covenants contained in Section 2.11 herein above inaccurate in any respect if made at the time of such discovery, Trustor shall promptly notify Beneficiary of such event or situation and, within fifteen (15) days after discovery, submit to Beneficiary a preliminary written environmental plan setting forth a general description of such event or situation and the action, if any, that Trustor proposes to take with respect thereto, including, without limitation, the giving of notice to and receipt of approval from appropriate governmental agencies. Within fifteen (15) days after submission, of such preliminary report, Trustor shall submit to Beneficiary a final written environmental report, setting forth a detailed description of such event, or situation and the action that Trustor proposes to take with respect thereto, including, without limitation, any proposed corrective work, the estimated cost and time of completion, the name of the contractor, a copy of the construction contract, if any, the governmental agencies contacted, the governmental agencies claiming jurisdiction, the approvals required from said governmental agencies and the estimated time to obtain said approvals, and such additional data, instruments, documents, agreements or other materials or information as Trustor may reasonably request. The plan shall be subject to the Lenders’s written approval, which approval may be granted or withheld in the Lender’s reasonable discretion. Beneficiary shall notify Trustor in writing of its approval or disapproval of the final plan within fifteen (15) days after receipt thereof by Beneficiary. If Beneficiary disapproves the plan, Beneficiary’s notice to Trustor of such disapproval shall include a brief explanation of the reasons therefor. Within fifteen (15) days after receipt of such notice of disapproval. Trustor shall submit to Beneficiary a revised final written environmental plan that remedies the defects identified by Beneficiary as reasons for Beneficiary’s disapproval of the initial final plan. If Trustor fails to submit a revised plan to Beneficiary within said fifteen (15) day period, or if such revised plan is submitted to Beneficiary and Beneficiary disapproves said plan, such failure or disapproval shall, at Beneficiary’s option and upon notice to Trustor, constitute an Event of Default hereunder, in which event Beneficiary shall have all of the rights and remedies available to it under subsection 4.2(ii). If Beneficiary does not notify Trustor of its approval or disapproval of the final plan or any revisions thereof within fifteen (15) days after receipt thereof, the plan or revision shall be deemed disapproved. Once any such plan is approved in writing or deemed approved by Beneficiary, Trustor shall promptly commence all action necessary to implement such plan and to comply with any requirements and conditions imposed by Beneficiary, and shall diligently and continuously pursue such action to completion in strict accordance with the terms thereof.
5.5. Notices. Whenever Trustor, Trustee or Beneficiary shall desire to give or serve any notice, demand, request or other communication with respect to this Deed of Trust, each such notice, demand, request or communication shall be given in writing (at the address set forth below) by any of the following means: (a) personal service: (b) electronic communication, whether by telex or telecopying (if confirmed in writing sent by overnight delivery service); or (c) overnight delivery service (such as FedEx), providing proof of delivery. Such addresses may be changed by notice to the other parties given in the same manner as provided above. Any notice, demand or request sent pursuant to either subsection (a) or (b) hereof shall be deemed received upon such personal service or upon dispatch by electronic means, and, if sent pursuant to subsection (c) shall be deemed received as of the date of delivery (whether accepted or refused) established by the overnight carrier’s proof of delivery.
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To Beneficiary: | Wells
Fargo Bank, N.A. 9062 Old Annapolis Road Columbia, MD 21045 Attention: Jason Prisco – Cadiz Inc./Cadiz Real Estate LLCP Telephone No.: (410) 884-2271 Email: ctsbankdebtadministrationteam@wellsfargo.com |
with a copy to: | Perkins Coie LLP 30 Rockefeller Plaza 22nd Floor New York, NY 10112-0015 Attention: Ronald Sarubbi Telephone:
212.262.6914 |
To Trustor: | Cadiz
Inc./Cadiz Real Estate LLC/Octagon Partners LLC 550 South Hope Street, Suite 2850, Los Angeles, California 90071 Attention: Chief Financial Officer Telephone No.: 213-271-1600 Telecopy No.: 213-271-1614 |
with a copy to: | Mitchell
Silberberg & Knupp LLP 11377 W. Olympic Blvd. Los Angeles, CA 90064 Attention: Kevin Friedmann Telecopy: (310) 312-3100 Telephone: (310) 312-3106 |
To Trustee: | Chicago
Title Company |
5.6. Sale of Participation. Beneficiary may, at any time, sell, transfer, assign or grant participations herein and other Obligations secured hereby, and Beneficiary may forward to each participant and prospective participant all documents and information which Beneficiary now has or later may acquire relating to those Obligations and to Trustor, and any partners or joint venturers of Trustor, whether furnished by Trustor or otherwise, as Beneficiary determines necessary or desirable.
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5.7. Acceptance by Trustee. Trustee accepts this Trust when this Deed of Trust, duly executed and acknowledged, is made a public record as provided by law.
5.8. Captions. The captions or headings at the beginning of each Section hereof are for the convenience of the parties and are not a part of this Deed of Trust.
5.9. Affidavit to Trustee. Trustee, upon presentation to it of an affidavit signed by or on behalf of Beneficiary, setting forth any fact or facts showing a default by Trustor under any of the terms or conditions of this Deed of Trust, is authorized to accept as true and conclusive all facts and statement in such affidavit and to act hereunder in complete reliance thereon.
5.10. Severability; Invalidity of Certain Provisions. Every provision of this Deed of Trust is intended to be severable. In the event any term or provision hereof is declared to be illegal or invalid for any reason whatsoever by a court of competent jurisdiction, such illegality or invalidity shall not affect the balance of the terms and provisions hereof, which terms and provisions shall remain binding and enforceable. If the lien of this Deed of Trust is invalid or unenforceable as to any part of the debt, or if the lien is invalid or unenforceable as to any part of the Trust Estate, the unsecured or partially unsecured portion of the debt shall be completely paid prior to the payment of the remaining and secured or partially secured portion of the debt, and all payments made on the debt, whether voluntary or under foreclosure or other enforcement action or procedure, shall be considered to have been first paid on and applied to the full payment of that portion of the debt which is not secured or fully secured by the lien of this Deed of Trust.
5.11. Waiver of Statute of Limitations. The right to plead any and all statutes of limitation as a defense to any demand secured by this Deed of Trust is hereby waived to the full extent permitted by law.
5.12. No Merger of Lease. If both the lessor’s and lessee’s estate under any lease or any portion thereof which constitutes a part of the Trust Estate shall at any time become vested in one owner, this Deed of Trust and the lien created hereby shall not be destroyed or terminated by application of the doctrine of merger unless Beneficiary so elects as evidenced by recording a written declaration so stating, and, unless and until Beneficiary so elects. Beneficiary shall continue to have and enjoy all of the rights and privileges of Beneficiary as to the separate estates. In addition, upon the foreclosure of the lien created by this Deed of Trust on the Trust Estate pursuant to the provisions hereof, any leases or subleases then existing and affecting all or any portion of the Trust Estate shall not be destroyed or terminated by application of the law of merger or as a matter of law or as a result of such foreclosure unless Beneficiary or any purchaser at such foreclosure sale shall so elect. No act by or on behalf of Beneficiary or any such purchaser shall constitute a termination of any lease or sublease unless Beneficiary or such purchaser shall give written notice thereof to such tenant or subtenant.
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5.13. Governing Law. Insofar as permitted by otherwise applicable law, this Deed of Trust and the indebtedness and obligations secured hereby shall be governed by and construed in accordance with the laws of California.
5.14. Beneficiary’s Right to Enter, Inspect and Cure. Beneficiary is authorized, by itself, its contractors, agents, employees or workmen, to enter at any reasonable time upon any part of the Premises for the purpose of inspecting the same, and for the purpose of performing any of the acts it is authorized to perform under the terms of the Loan Document and this Deed of Trust
5.15. Interpretation and Successors in Interest. Subject to the provisions of Section 2.17 hereof, this Deed of Trust applies to, to the benefit of, and binds all parties hereto, their heirs, legatees, devisees, administrators, executors, successors and assigns. The term “Beneficiary” shall mean the owner and holder, including pledgees, of the Credit Agreement, now or hereafter whether or not named as Beneficiary herein. All capitalized terms used herein without definition shall have the respective meanings ascribed to them in the Credit Agreement. The rules of construction specified in Section 1.2 of the Credit Agreement shall also apply to this Deed of Trust. Any reference in this Deed of Trust to any document, instrument or agreement creating or evidencing an obligation secured hereby shall include such document, instrument or agreement both as originally executed and as it may from time to time be modified. In the performance of its duties hereunder, the Beneficiary shall be afforded all of the rights, benefits, protections, immunities and indemnities entitled to it under the Credit Agreement.
5.16. Reconveyance by Trustee. Upon written request of Beneficiary stating that all sums secured hereby have been paid, and upon surrender of this Deed of Trust to Trustee for cancellation and retention and upon payment by Trustor of Trustee’s fees, Trustee shall reconvey to Trustor, or to the Person or Persons legally entitled thereto, without warranty, any portion of the Trust Estate then held hereunder. The recitals in such reconveyance of any matters or facts shall be conclusive proof of the truthfulness thereof. The grantee in any reconveyance may be described as “the person or persons legally entitled thereto.”
5.17. Conflicts. To the extent that this Deed of Trust or any of the other Loan Documents are inconsistent with the Credit Agreement, the Credit Agreement shall supersede any other agreement or document relating to the matters referred to herein or therein.
5.18. Counterparts; Recording References. This Deed of Trust may be executed in several original counterparts. To facilitate filing and recording, there may be omitted from certain counterparts the parts of Exhibit A hereto containing specific descriptions of certain collateral constituting the Trust Estate which relate to land under the jurisdiction of offices or located in cities or counties other than the office or city or county in which the particular counterpart is to be filed or recorded. A complete copy of this Deed of Trust is being filed for record in the Office of the County Recorder of San Bernardino. Each counterpart shall be deemed to be an original for all purposes, and all counterparts shall together constitute a single document; provided, however, Beneficiary and Trustee shall also have the option to exercise all rights and remedies available to Beneficiary and Trustee hereunder and under applicable law as though each counterpart hereof were a separate deed of trust, or other security instrument covering only the portions of the collateral constituting the Trust Estate located in the city or county wherein such counterpart is recorded. Unless otherwise specified in Exhibit A hereto, all recording references in Exhibit A are to the official real property records of the city or county as appropriate, in which the affected land is located. The references in Exhibit A to liens, encumbrances and other burdens, if any, shall not be deemed to recognize or create any rights in third parties.
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5.19. Nonforeign Entity. Section 1445 of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”) provides that a transferee of a U.S. real property interest must withhold tax if the transferor is a foreign Person. To inform Beneficiary that the withholding of tax will not be required in the event of the disposition of the Premises or Improvements pursuant to the terms of this Deed of Trust, Trustor hereby certifies, under penalty of perjury, that:
(i) Trustor is not a foreign corporation, foreign, partnership, foreign trust or foreign estate, as those terms are defined in the Internal Revenue Code and the regulations promulgated thereunder;
(ii) Cadiz’s U.S. employer identification number is 77-0313235, CRE’s U.S. employer identification number is 77-0313235 and Octagon Partner’s U.S. employer identification number is ___________; and
(iii) Trustor’s principal place of business is 550 South Hope Street, Suite 2850 Los Angeles CA 90071
It is understood that Beneficiary may disclose the contents of this certification to the Internal Revenue Service and that any false statement contained herein could be punished by fine, imprisonment or both. Trustor covenants and agrees to execute such further certificates, which shall be signed under penalty of perjury, as Beneficiary shall reasonably require. The covenant set forth herein shall survive the foreclosure of the lien of this Deed of Trust or acceptance of a deed in lieu thereof
5.20. Agent’s Rights. It is expressly understood and agreed by the parties to this Deed of Trust that (i) Wells Fargo Bank, National Association is entering into this Agreement and acting hereunder solely in its capacity as Agent under the Credit Agreement and (ii) in entering into and acting as Agent hereunder, Wells Fargo Bank, National Association shall be afforded all of the rights, protections, benefits, indemnities and immunities granted to the Agent in the Credit Agreement as if set forth in their entirety herein. Any act, or refusal to act, hereunder requiring the Agent to exercise discretion (including, but not limited to, the exercise of remedies following an Event of Default) shall be exercised in accordance with the terms of the Credit Agreement. The permissive authorizations, entitlements, powers and rights granted to the Agent herein (including the right to (i) request any documentation, (ii) request the taking of any action and (iii) exercise any remedies) shall not be construed as duties.
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5.21. Discretionary Acts. Any duty, role, responsibility, action or inaction contemplated or required on the part of Agent hereunder is expressly subject to the terms and conditions of the Credit Agreement, and Agent shall be entitled to all of the rights, powers, benefits, protections, immunities and indemnities granted to it in the Credit Agreement from the Lenders as if explicitly set forth herein. Any act or omission to act involving the exercise of discretion by Agent shall be exercised in accordance with the terms of the Credit Agreement. The Agent may execute any of its duties under this Agreement by or through agents or attorneys-in-fact and shall not be responsible for the negligence or misconduct of any agents or attorneys in-fact selected by it with reasonable care.
5.22. Consent/Performance by Beneficiary or Lenders. Notwithstanding anything to the contrary set forth herein, with respect to (a) any consent or notice herein to be obtained or given by Beneficiary or Lenders, as applicable and (b) any and all decisions, actions or performance which may be made or taken by Beneficiary or Lenders hereunder, as applicable, Trustor shall accept any such notices, consents, actions and performance, from or by Agent, as that also being from, by or on behalf of, Beneficiary and the Lenders as though, and with the same effect as if, the same had been directly given, done or performed by the Beneficiary and Required Lenders (as defined in the Credit Agreement). In furtherance thereof, in the event that Trustor receives any such notices, consents, actions and performances from Agent, Trustor may rely thereon without the requirement that Agent provide, or Trustor obtain, proof of Agent’s authority with respect thereto to bind Beneficiary or the Lenders. In the event that Trustor receives any written notice from, and executed by, Lenders qualifying as Required Lenders that, from and after the date thereof, Trustor shall thereafter only rely upon any consent, notice, action or performance from the Required Lenders (and not Beneficiary), and to ignore any of the same from Agent, and such notice specifically names one of the Required Lenders as the party upon which all subsequent notices shall be given or be sent to (it being the express intent of Agent, Beneficiary and Lenders that Trustor shall at all times only be required to give or accept notices to or from one of Agent, Beneficiary or one of the Required Lenders), Trustor shall (i) comply with such written notice until such time as the same has been rescinded or modified by written notice signed by the Required Lenders and (ii) Trustor may thereafter rely upon any subsequent notice, consent, action or performance given by the Required Lender so named without the requirement that Agent, Beneficiary or any other Lender provide, or Trustor obtain, proof of said Required Lender(s) authority with respect thereto to bind Beneficiary or Lenders.
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ARTICLE
VI
SURETYSHIP WAIVERS
6.1. In addition to all waivers expressed in the Credit Agreement and the other Loan Documents, to the extent that any Person comprising Trustor (a “Trustor Party”) is construed as or constitutes a surety with respect to any other Trustor Party, then the following provisions shall apply:
(a) Each Trustor Party hereby absolutely, unconditionally, knowingly, and expressly waives and agrees not to assert or take advantage of any defense based upon (1) presentment, demand, protest and notice of protest, notice of dishonor and of non-payment, notice of acceptance of the Loan Documents, and diligence in collection; (2) notice of the existence, creation, or incurring of any new or additional obligations under or pursuant to any of the Loan Documents; (3) any right to require Beneficiary to proceed against, give notice to, or make demand upon any other Trustor Party; (4) any right to require Beneficiary to proceed against or exhaust any security or to proceed against or exhaust any security in any particular order; (5) any right to require Beneficiary to pursue any remedy of Beneficiary; (6) any right to direct the application of any security held by Beneficiary; (7) any right of subrogation or to enforce any remedy which Beneficiary may have against any other Trustor Party and any right to participate in any security now or hereafter held by Beneficiary and any right to reimbursement from any other Person comprising Trustor for amounts paid to Beneficiary by any other Trustor Party at any time prior to the Payment in Full (as hereinafter defined) of all obligations of Trustor under the Loan Documents and of all Obligations secured by this Deed of Trust; (8) any defense arising out of any disability or other defense of any Trustor Party, including bankruptcy, dissolution, liquidation, cessation, impairment, modification, or limitation, from any cause, of any liability of Trustor, or of any remedy for the enforcement of such liability; (9) any right to plead or assert any election of remedies by Beneficiary; (10) any other defenses available to a surety under applicable law: (11) notice of any adverse change in the financial condition of any Trustor Party or of any other fact that might increase such Trustor Party’s risk under the Loan Documents; and (12) all notices (except if such notice is specifically required to be given to such Trustor Party) and demands to which Trustor might otherwise be entitled. As used herein, the term “Payment in Full” with respect to any obligation shall mean the payment in full in cash of all such obligations and the expiration of all applicable time periods regarding bankruptcy preference, fraudulent conveyance or other avoidance actions that may be applicable to the circumstances of payment of any or all of such obligations under any and all laws of the State of California and federal laws.
(b) Each Trustor Party hereby waives any rights it may have under Sections 2845 or 2850 of the California Civil Code, or otherwise, to require Beneficiary to institute suit against, or to exhaust any rights or remedies which Beneficiary has or may have against, any other Trustor Party or any third party, or against any collateral for the Obligations provided by Trustor or any third party. In this regard, each Trustor Party agrees that it is bound to the payment of all Obligations, whether now existing or hereafter accruing as fully as if such Obligations were directly owing to Beneficiary by each Trustor Party. Each Trustor Party further waives any defense arising by reason of any disability or other defense (other than the defense that the Obligations shall have been fully and finally performed and paid) of such Trustor Party or by reason of the cessation from any cause whatsoever of the liability of such Trustor Party in respect thereof.
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(c) Each Trustor Party hereby waives: (1) any rights to assert against Beneficiary any defense (legal or equitable), set-off, counterclaim, or claim which any other Trustor Party may now or at any time hereafter have against any other Trustor Party or any other party liable to Beneficiary; (2) any defense, set-off, counterclaim, or claim, of any kind or nature, arising directly or indirectly from the present or future lack of perfection, sufficiency, validity, or enforceability of the Obligations or any security therefor; and (3) any defense Trustor has to performance hereunder, and any right Trustor has to be exonerated, provided by Sections 2819, 2822, or 2825 of the California Civil Code, or otherwise, arising by reason of: any claim or defense based upon an election of remedies by Beneficiary; the impairment or suspension of Beneficiary’s rights or remedies against Trustor; the alteration by Beneficiary of the Obligations; any discharge of Trustor’s Obligations to Beneficiary by operation of law as a result of Beneficiary’s intervention or omission; or the acceptance by Beneficiary of anything in partial satisfaction of the Obligations.
(d) Each Trustor Party hereby waives any right of subrogation it may have as against any other Trustor Party with respect to the Obligations. In addition, each Trustor Party hereby waives any right to proceed against any other Trustor Party, now or hereafter, for contribution, indemnity, reimbursement, and any other suretyship right and claims, whether direct or indirect, liquidated or contingent, whether arising under express or implied contract or by operation of law, which any Trustor Patty may now have or hereafter have as against any other Trustor Party with respect to the Obligations. Each Trustor Party also hereby waives any rights to recourse to or with respect to any asset of any other Trustor Party. Each Trustor Party agrees that in light of the immediately foregoing waivers, the execution of this Deed of Trust shall not be deemed to make each Trustor Party a “creditor” of any other Trustor Party, and that for purposes of Sections 547 and 550 of the Bankruptcy Code each Trustor Party shall not be deemed a “creditor” of any other Trustor Party. Notwithstanding the foregoing, the waivers set forth is this subsection 6.1(d) shall only apply until the indefeasible Payment in Full of all obligations of Trustor under the Loan Documents and of all of the Obligations under this Deed of Trust.
(e) Each Trustor Party waives all rights and defenses arising out of an election of remedies by Beneficiary, even though that election of remedies, such as a non-judicial foreclosure with respect to security for the Obligations, has destroyed such Trustor Party’s rights of subrogation and reimbursement against the principal by the operation of Section 580d of the California Code of Civil Procedure (the “CCP”) or otherwise. Each Trustor Party acknowledges and agrees that, as a result of the foregoing sentence, it is knowingly waiving in advance a complete or partial defense to this Deed of Trust arising under CCP Sections 580d or 580a and based upon Beneficiary’s election to conduct a private non-judicial foreclosure sale, even though such election would destroy, diminish, or affect such Trustor Party’s rights of subrogation against any other Trustor Party or any other party and each such Trustor Party’s rights to pursue any other Trustor Party or such other party for reimbursement contribution, indemnity, or otherwise.
(f) WITHOUT LIMITING THE GENERALITY OF ANY OTHER WAIVER OR OTHER PROVISION SET FORTH IN THIS DEED OF TRUST OR ANY OTHER AGREEMENT ENTERED INTO WITH RESPECT TO THE LOAN DOCUMENTS, TRUSTOR HEREBY WAIVES AND AGREES NOT TO ASSERT ANY AND ALL BENEFITS OR DEFENSES ARISING DIRECTLY OR INDIRECTLY UNDER ANY ONE OR MORE OF CALIFORNIA CIVIL CODE SECTIONS 2799, 2808, 2809, 2810, 2815, 2819, 2820, 2821, 2822, 2825, 2839, 2845, 2848, 2849, 2850, 2899 and 3433, AND CHAPTER 2 OF TITLE 14 OF THE CALIFORNIA CIVIL CODE.
[Signature Page Follows]
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IN WITNESS WHEREOF, Trustor has, effective as of the Effective Date, caused this instrument to be duly EXECUTED AND DELIVERED by authority duly given.
TRUSTOR: | |||
CADIZ INC., a Delaware corporation | |||
By: | /s/ Timothy J. Shaheen | ||
Name: | Timothy J. Shaheen | ||
Title: | Chief Financial Officer |
Acknowledgment
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. |
STATE OF California )
COUNTY OF Los Angeles )
On May 23, 2017 before me, Teffiny Bagnara, notary public (insert name and title of the officer), personally appeared Timothy J. Shaheen, who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
/s/ Teffiny Bagnara | ||
(Signature) | (Affix Seal) |
[Signature Page to Deed of Trust]
IN WITNESS WHEREOF, Trustor has, effective as of the Effective Date, caused this instrument to be duly EXECUTED AND DELIVERED by authority duly given.
TRUSTOR: | |||
CADIZ REAL ESTATE LLC, | |||
a Delaware limited liability company | |||
By: | /s/ Timothy J. Shaheen | ||
Name: | Timothy J. Shaheen | ||
Title: | Chief Financial Officer |
Acknowledgment
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. |
STATE OF California )
COUNTY OF Los Angeles )
On May 23, 2017 before me, Teffiny Bagnara, notary public (insert name and title of the officer), personally appeared Timothy J. Shaheen who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
/s/ Teffiny Bagnara | ||
(Signature) | (Affix Seal) |
[Signature Page to Deed of Trust]
IN WITNESS WHEREOF, Trustor has, effective as of the Effective Date, caused this instrument to be duly EXECUTED AND DELIVERED by authority duly given.
TRUSTOR: | |||
OCTAGON PARTNERS, LLC, | |||
a Delaware limited liability company | |||
By: | /s/ Timothy J. Shaheen | ||
Name: | Timothy J. Shaheen | ||
Title: | Manager |
Acknowledgment
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. |
STATE OF California )
COUNTY OF Los Angeles )
On May 23, 2017 before me, Teffiny Bagnara, notary (insert name and title of the officer), personally appeared Timothy J. Shaheen, who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
/s/ Teffiny Bagnara | ||
(Signature) | (Affix Seal) |
[Signature Page to Deed of Trust]
EXHIBIT A
Description of Real Property
[Attached]
DIVISION A:
PARCEL 1: (558-201-11)
ALL OF SECTION 29, TOWNSHIP 6 NORTH, RANGE 14 EAST, SAN BERNARDINO MERIDIAN, ACCORDING TO THE OFFICIAL PLAT OF SAID LAND.
PARCEL 2: (558-201-13,14)
ALL OF SECTION 33, TOWNSHIP 6 NORTH, RANGE 14 EAST, SAN BERNARDINO MERIDIAN, ACCORDING TO THE OFFICIAL PLAT OF SAID LAND.
EXCEPTING THEREFROM THE ABOVE PARCELS 1 AND 2 ALL RIGHT, TITLE AND INTEREST IN AND TO ALL MINERALS AND MINERAL RIGHTS, INCLUDING WITHOUT LIMITATION, OIL, GAS AND OTHER HYDROCARBONS, COAL, GEOTHERMAL RESOURCES, PRECIOUS METAL ORES, INDUSTRIAL-GRADE SILICATES AND CARBONATES, FISSIONABLE MATERIALS, SAND GRAVEL, AGGREGATES, AND ALL OTHER MINERALS OF EVERY KIND AND CHARACTER, METALLIC OR OTHERWISE, WHETHER OR NOT PRESENTLY KNOWN TO SCIENCE OR INDUSTRY, NOW KNOWN TO EXIST OR HEREAFTER DISCOVERED UPON, WITHIN OR UNDERLYING THE SURFACE AT WHICH ANY SUCH SUBSTANCES MAY BE FOUND; HOWEVER, GRANTOR, ITS SUCCESSORS AND ASSIGNS SHALL NOT HAVE THE RIGHT FOR ANY PURPOSE WHATSOEVER TO ENTER UPON, INTO OR THROUGH THE SURFACE OF THE FIRST 300 FEET OF THE SUBSURFACE OF THE PROPERTY IN CONNECTION THEREWITH. GRANTOR ACKNOWLEDGES AND AGREES THAT SAID MINERAL RESERVATION SHALL NOT BE DEEMED TO LIMIT THE RIGHT OF GRANTEE TO EXTRACT WATER FROM THE PROPERTY WHICH MAY INCLUDE THE INCIDENTAL EXTRACTION OF MINERALS, SAND, GRAVEL OR OTHER MATERIAL IN CONNECTION WITH THE EXTRACTION OF WATER, AS RESERVED BY SF PACIFIC PROPERTIES INC., A DELAWARE CORPORATION IN THE DEED RECORDED DECEMBER 26, 1996 AS INSTRUMENT NO. 96-472401 OFFICIAL RECORDS.
DIVISION B:
PARCEL 3: (658-131-02)
GOVERNMENT TRACT 38, TOWNSHIP 11 NORTH, RANGE 20 EAST, SAN BERNARDINO BASE AND MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, AS PER GOVERNMENT RESURVEY DATED SEPTEMBER 29, 1924.
EXCEPTING THEREFROM, ALL RIGHT, TITLE AND INTEREST IN AND TO ALL COAL, HYDROCARBONS, GEOTHERMAL RESOURCES, PRECIOUS METALS ORES, BASE METALS ORES, INDUSTRIAL-GRADE SILICATES AND CARBONATES, FISSIONABLE MINERALS, SAND, GRAVEL, AGGREGATES, AND ALL OTHER MINERALS OF EVERY KIND AND CHARACTER, METALLIC OR OTHERWISE, WHETHER OR NOT PRESENTLY KNOWN TO SCIENCE OR INDUSTRY, NOW KNOW TO EXIST OR HEREAFTER DISCOVERED UPON, WITHIN OR UNDERLYING THE SURFACE OF SAID LAND REGARDLESS OF THE DEPTH BELOW THE SURFACE AT WHICH ANY SUCH SUBSTANCE MAY BE FOUND; HOWEVER, GRANTOR OR ITS SUCCESSORS AND ASSIGNS, SHALL NOT HAVE THE RIGHT FOR ANY PURPOSE WHATSOEVER TO ENTER UPON, INTO OR THROUGH THE SURFACE OR THE FIRST 300 FEET OR THE SUBSURFACE OF THE PROPERTY AS RESERVED BY SF PACIFIC PROPERTIES, INC., A DELAWARE CORPORATION, RECORDED JANUARY 6, 1993, AS INSTRUMENT NO. 93-000748, OFFICIAL RECORDS.
PARCEL 4: (658-131-06)
GOVERNMENT TRACT 42, TOWNSHIP 11 NORTH, RANGE 20 EAST, SAN BERNARDINO BASE AND MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO GOVERNMENT RESURVEY, DATED SEPTEMBER 29, 1924.
EXCEPTING THEREFROM, ALL RIGHT, TITLE AND INTEREST IN AND TO ALL COAL, HYDROCARBONS, GEOTHERMAL RESOURCES, PRECIOUS METALS ORES, BASE METALS ORES, INDUSTRIAL-GRADE SILICATES AND CARBONATES, FISSIONABLE MINERALS, SAND, GRAVEL, AGGREGATES, AND ALL OTHER MINERALS OF EVERY KIND AND CHARACTER, METALLIC OR OTHERWISE, WHETHER OR NOT PRESENTLY KNOWN TO SCIENCE OR INDUSTRY, NOW KNOW TO EXIST OR HEREAFTER DISCOVERED UPON, WITHIN OR UNDERLYING THE SURFACE OF SAID LAND REGARDLESS OF THE DEPTH BELOW THE SURFACE AT WHICH ANY SUCH SUBSTANCE MAY BE FOUND; HOWEVER, GRANTOR OR ITS SUCCESSORS AND ASSIGNS, SHALL NOT HAVE THE RIGHT FOR ANY PURPOSE WHATSOEVER TO ENTER UPON, INTO OR THROUGH THE SURFACE OR THE FIRST 300 FEET OR THE SUBSURFACE OF THE PROPERTY AS RESERVED BY SF PACIFIC PROPERTIES, INC., A DELAWARE CORPORATION, RECORDED JANUARY 6, 1993, AS INSTRUMENT NO. 93-000748, OFFICIAL RECORDS.
A-1
PARCEL 5: (568-341-07)
LOTS 1, 2, 3, 4 AND 5 AND THE NORTH 1/2 OF SECTION 29, TOWNSHIP 12 NORTH, RANGE 20 EAST, SAN BERNARDINO BASE AND MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO GOVERNMENT SURVEY.
EXCEPTING THEREFROM, ALL RIGHT, TITLE AND INTEREST IN AND TO ALL COAL, HYDROCARBONS, GEOTHERMAL RESOURCES, PRECIOUS METALS ORES, BASE METALS ORES, INDUSTRIAL-GRADE SILICATES AND CARBONATES, FISSIONABLE MINERALS, SAND, GRAVEL, AGGREGATES, AND ALL OTHER MINERALS OF EVERY KIND AND CHARACTER, METALLIC OR OTHERWISE, WHETHER OR NOT PRESENTLY KNOWN TO SCIENCE OR INDUSTRY, NOW KNOW TO EXIST OR HEREAFTER DISCOVERED UPON, WITHIN OR UNDERLYING THE SURFACE OF SAID LAND REGARDLESS OF THE DEPTH BELOW THE SURFACE AT WHICH ANY SUCH SUBSTANCE MAY BE FOUND; HOWEVER, GRANTOR OR ITS SUCCESSORS AND ASSIGNS, SHALL NOT HAVE THE RIGHT FOR ANY PURPOSE WHATSOEVER TO ENTER UPON, INTO OR THROUGH THE SURFACE OR THE FIRST 300 FEET OR THE SUBSURFACE OF THE PROPERTY AS RESERVED BY SF PACIFIC PROPERTIES, INC., A DELAWARE CORPORATION, RECORDED JANUARY 6, 1993, AS INSTRUMENT NO. 93-000748, OFFICIAL RECORDS.
PARCEL 6: (568-341-04)
LOTS 1, 2 AND 3 AND THE EAST 1/2 AND THE EAST 1/2 OF THE WEST 1/2 AND THE SOUTHWEST 1/4 OF THE SOUTHWEST 1/4 OF SECTION 33, TOWNSHIP 12 NORTH, RANGE 20 EAST, SAN BERNARDINO BASE AND MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO GOVERNMENT SURVEY.
EXCEPTING THEREFROM, ALL RIGHT, TITLE AND INTEREST IN AND TO ALL COAL, HYDROCARBONS, GEOTHERMAL RESOURCES, PRECIOUS METALS ORES, BASE METALS ORES, INDUSTRIAL-GRADE SILICATES AND CARBONATES, FISSIONABLE MINERALS, SAND, GRAVEL, AGGREGATES, AND ALL OTHER MINERALS OF EVERY KIND AND CHARACTER, METALLIC OR OTHERWISE, WHETHER OR NOT PRESENTLY KNOWN TO SCIENCE OR INDUSTRY, NOW KNOW TO EXIST OR HEREAFTER DISCOVERED UPON, WITHIN OR UNDERLYING THE SURFACE OF SAND LAND REGARDLESS OF THE DEPTH BELOW THE SURFACE AT WHICH ANY SUCH SUBSTANCE MAY BE FOUND; HOWEVER, GRANTOR OR ITS SUCCESSORS AND ASSIGNS, SHALL NOT HAVE THE RIGHT FOR ANY PURPOSE WHATSOEVER TO ENTER UPON, INTO OR THROUGH THE SURFACE OR THE FIRST 300 FEET OR THE SUBSURFACE OF THE PROPERTY AS RESERVED BY SF PACIFIC PROPERTIES, INC., A DELAWARE CORPORATION, RECORDED JANUARY 6, 1993, AS INSTRUMENT NO. 93-000748, OFFICIAL RECORDS.
PARCEL 7: (658-141-04)
GOVERNMENT TRACT 39, TOWNSHIP 11 NORTH, RANGE 20 EAST, SAN BERNARDINO BASE AND MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO GOVERNMENT RESURVEY DATED SEPTEMBER 29, 1924.
EXCEPTING THEREFROM, ALL RIGHT, TITLE AND INTEREST IN AND TO ALL COAL, HYDROCARBONS, GEOTHERMAL RESOURCES, PRECIOUS METALS ORES, BASE METALS ORES, INDUSTRIAL-GRADE SILICATES AND CARBONATES, FISSIONABLE MINERALS, SAND, GRAVEL, AGGREGATES, AND ALL OTHER MINERALS OF EVERY KIND AND CHARACTER, METALLIC OR OTHERWISE, WHETHER OR NOT PRESENTLY KNOWN TO SCIENCE OR INDUSTRY, NOW KNOW TO EXIST OR HEREAFTER DISCOVERED UPON, WITHIN OR UNDERLYING THE SURFACE OF SAID LAND REGARDLESS OF THE DEPTH BELOW THE SURFACE AT WHICH ANY SUCH SUBSTANCE MAY BE FOUND; HOWEVER, GRANTOR OR ITS SUCCESSORS AND ASSIGNS, SHALL NOT HAVE THE RIGHT FOR ANY PURPOSE WHATSOEVER TO ENTER UPON, INTO OR THROUGH THE SURFACE OR THE FIRST 300 FEET OR THE SUBSURFACE OF THE PROPERTY AS RESERVED BY SF PACIFIC PROPERTIES, INC., A DELAWARE CORPORATION, RECORDED JANUARY 6, 1993, AS INSTRUMENT NO, 93-000748, OFFICIAL RECORDS.
A-2
PARCEL 8: (659-061-16)
SECTION 13, TOWNSHIP 10 NORTH, RANGE 19 EAST, SAN BERNARDINO BASE AND MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO GOVERNMENT SURVEY. EXCEPTING THEREFROM, ALL RIGHT, TITLE AND INTEREST IN AND TO ALL COAL, HYDROCARBONS, GEOTHERMAL RESOURCES, PRECIOUS METALS ORES, BASE METALS ORES, INDUSTRIAL-GRADE SILICATES AND CARBONATES, FISSIONABLE MINERALS, SAND, GRAVEL, AGGREGATES, AND ALL OTHER MINERALS OF EVERY KIND AND CHARACTER, METALLIC OR OTHERWISE, WHETHER OR NOT PRESENTLY KNOWN TO SCIENCE OR INDUSTRY, NOW KNOWN TO EXIST OR HEREAFTER DISCOVERED UPON, WITHIN OR UNDERLYING THE SURFACE OF SAID LAND REGARDLESS OF THE DEPTH BELOW THE SURFACE AT WHICH ANY SUCH SUBSTANCE MAY BE FOUND; HOWEVER, GRANTOR OR ITS SUCCESSORS AND ASSIGNS, SHALL NOT HAVE THE RIGHT FOR ANY PURPOSE WHATSOEVER TO ENTER UPON, INTO OR THROUGH THE SURFACE OR THE FIRST 300 FEET OF THE SUBSURFACE OF SAID LAND AS RESERVED IN THE DEED FROM SF PACIFIC PROPERTIES INC., A DELAWARE CORPORATION, RECORDED SEPTEMBER 30, 1993 AS INSTRUMENT NO. 93-419956, OFFICIAL RECORDS.
PARCEL 9: (659-051-07)
SECTION 25, TOWNSHIP 10 NORTH, RANGE 19 EAST, SAN BERNARDINO BASE AND MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO GOVERNMENT SURVEY.
EXCEPTING THEREFROM, ALL RIGHT, TITLE AND INTEREST IN AND TO ALL COAL, HYDROCARBONS, GEOTHERMAL RESOURCES, PRECIOUS METALS ORES, BASE METALS ORES, INDUSTRIAL-GRADE SILICATES AND CARBONATES, FISSIONABLE MINERALS, SAND, GRAVEL, AGGREGATES, AND ALL OTHER MINERALS OF EVERY KIND AND CHARACTER, METALLIC OR OTHERWISE, WHETHER OR NOT PRESENTLY KNOWN TO SCIENCE OR INDUSTRY, NOW KNOWN TO EXIST OR HEREAFTER DISCOVERED UPON, WITHIN OR UNDERLYING THE SURFACE OF SAID LAND REGARDLESS OF THE DEPTH BELOW THE SURFACE AT WHICH ANY SUCH SUBSTANCE MAY BE FOUND; HOWEVER, GRANTOR OR ITS SUCCESSORS AND ASSIGNS, SHALL NOT HAVE THE RIGHT FOR ANY PURPOSE WHATSOEVER TO ENTER UPON, INTO OR THROUGH THE SURFACE OR THE FIRST 300 FEET OF THE SUBSURFACE OF SAID LAND AS RESERVED IN THE DEED FROM SF PACIFIC PROPERTIES INC., A DELAWARE CORPORATION, RECORDED SEPTEMBER 30, 1993 AS INSTRUMENT NO. 93-419956, OFFICIAL RECORDS.
PARCEL 10: (659-081-03)
SECTION 21, TOWNSHIP 10 NORTH, RANGE 20 EAST, SAN BERNARDINO BASE AND MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO GOVERNMENT SURVEY.
EXCEPTING THEREFROM, ALL RIGHT, TITLE AND INTEREST IN AND TO ALL COAL, HYDROCARBONS, GEOTHERMAL RESOURCES, PRECIOUS METALS ORES, BASE METALS ORES, INDUSTRIAL-GRADE SILICATES AND CARBONATES, FISSIONABLE MINERALS, SAND, GRAVEL, AGGREGATES, AND ALL OTHER MINERALS OF EVERY KIND AND CHARACTER, METALLIC OR OTHERWISE, WHETHER OR NOT PRESENTLY KNOWN TO SCIENCE OR INDUSTRY, NOW KNOWN TO EXIST OR HEREAFTER DISCOVERED UPON, WITHIN OR UNDERLYING THE SURFACE OF SAID LAND REGARDLESS OF THE DEPTH BELOW THE SURFACE AT WHICH ANY SUCH SUBSTANCE MAY BE FOUND; HOWEVER, GRANTOR OR ITS SUCCESSORS AND ASSIGNS, SHALL NOT HAVE THE RIGHT FOR ANY PURPOSE WHATSOEVER TO ENTER UPON, INTO OR THROUGH THE SURFACE OR THE FIRST 300 FEET OF THE SUBSURFACE OF SAID LAND AS RESERVED IN THE DEED FROM SF PACIFIC PROPERTIES INC., A DELAWARE CORPORATION, RECORDED SEPTEMBER 30, 1993 AS INSTRUMENT NO. 93-419956, OFFICIAL RECORDS.
PARCEL 11: (659-081-25,26)
SECTION 29, TOWNSHIP 10 NORTH, RANGE 20 EAST, SAN BERNARDINO BASE AND MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO GOVERNMENT SURVEY.
A-3
EXCEPTING THEREFROM, ALL RIGHT, TITLE AND INTEREST IN AND TO ALL COAL, HYDROCARBONS, GEOTHERMAL RESOURCES, PRECIOUS METALS ORES, BASE METALS ORES, INDUSTRIAL-GRADE SILICATES AND CARBONATES, FISSIONABLE MINERALS, SAND, GRAVEL, AGGREGATES, AND ALL OTHER MINERALS OF EVERY KIND AND CHARACTER, METALLIC OR OTHERWISE, WHETHER OR NOT PRESENTLY KNOWN TO SCIENCE OR INDUSTRY, NOW KNOWN TO EXIST OR HEREAFTER DISCOVERED UPON, WITHIN OR UNDERLYING THE SURFACE OF SAID LAND REGARDLESS OF THE DEPTH BELOW THE SURFACE AT WHICH ANY SUCH SUBSTANCE MAY BE FOUND; HOWEVER, GRANTOR OR ITS SUCCESSORS AND ASSIGNS, SHALL NOT HAVE THE RIGHT FOR ANY PURPOSE WHATSOEVER TO ENTER UPON, INTO OR THROUGH THE SURFACE OR THE FIRST 300 FEET OF THE SUBSURFACE OF SAID LAND AS RESERVED IN THE DEED FROM SF PACIFIC PROPERTIES INC., A DELAWARE CORPORATION, RECORDED SEPTEMBER 30, 1993 AS INSTRUMENT NO. 93-419956, OFFICIAL RECORDS.
EXCEPTING THEREFROM THAT PORTION OF SECTION 29 CONVEYED TO THE CALIFORNIA, ARIZONA AND SANTA FE RAILWAY COMPANY, A CORPORATION, BY DEED RECORDED MARCH 16, 1914 IN BOOK 548, PAGE 29 OF DEEDS.
PARCEL 12: (556-341-04)
PARCEL 4 OF PARCEL MAP NO. 10131, IN THE UNINCORPORATED AREA OF SAN BERNARDINO COUNTY, AS PER PLAT RECORDED IN BOOK 108, OF PARCEL MAPS, PAGE 55, RECORDS OF SAID COUNTY.
PARCEL 13: (556-311-14,16)
SECTIONS 32 AND 34, TOWNSHIP 5 NORTH, RANGE 14 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
PARCEL 14: (556-311-52)
THE NORTHWEST ONE-QUARTER AND THE NORTHEAST ONE-QUARTER AND THE NORTH ONE-HALF OF THE SOUTHWEST ONE-QUARTER AND THE NORTH ONE-HALF OF THE SOUTHEAST ONE-QUARTER OF SECTION 21, TOWNSHIP 5 NORTH, RANGE 14 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
PARCEL 15: (556-291-10,11)
ALL OF SECTION 16, TOWNSHIP 5 NORTH, RANGE 14 EAST, SAN BERNARDINO BASE AND MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPTING THEREFROM A RECTANGULAR PARCEL OF LAND IN THE NORTHEAST ONE-QUARTER OF THE SOUTHEAST ONE-QUARTER OF SAID SECTION 16 DESCRIBED AS FOLLOWS:
BEGINNING AT A POINT IN THE NORTHERN RIGHT OF WAY LINE OF THE CALIFORNIA, ARIZONA AND SANTA FE RAILWAY COMPANY, DISTANT 86 FEET NORTHERLY, AT RIGHT ANGLES FROM THE CENTER LINE OF WESTBOUND MAIN TRACT OF SAID RAILWAY COMPANY, SAID POINT BEING 546.1 FEET WESTERLY ALONG SAID RIGHT OF WAY LINE FROM ITS INTERSECTION WITH THE EAST LINE OF SAID SECTION 16, DISTANT 365.6 FEET SOUTH ON SAID EAST LINE FROM THE EAST 1/4 CORNER OF SAID SECTION; THENCE WESTERLY ALONG SAID RIGHT OF WAY LINE, 363 FEET; THENCE NORTHERLY AT RIGHT ANGLES, 120 FEET; THENCE EASTERLY, PARALLEL WITH SAID NORTHERN RIGHT OF WAY LINE, 363 FEET; THENCE SOUTHERLY AT RIGHT ANGLES, 120 FEET TO THE POINT OF BEGINNING.
ALSO EXCEPTING THEREFROM A RECTANGULAR PARCEL OF LAND IN THE NORTHEAST ONE-QUARTER OF THE SOUTHEAST ONE-QUARTER OF SECTION 16, TOWNSHIP 5 NORTH, RANGE 14 EAST, SAN BERNARDINO BASE AND MERIDIAN, DESCRIBED AS FOLLOWS:
A-4
BEGINNING AT A POINT IN THE NORTHERN RIGHT OF WAY LINE OF THE CALIFORNIA, ARIZONA AND SANTA FE RAILWAY COMPANY, DISTANT 86 FEET NORTHERLY, AT RIGHT ANGLES FROM THE CENTER LINE OF THE WESTBOUND MAIN TRACK OF SAID RAILWAY COMPANY, SAID POINT BEING DISTANT 183.1 FEET WESTERLY ALONG SAID RIGHT OF WAY LINE FROM ITS INTERSECTION WITH THE EAST LINE OF SAID SECTION 16, DISTANT 165.6 FEET SOUTH ON SAID EAST LINE FROM THE EAST 1/4 CORNER OF SAID SECTION: THENCE WESTERLY ALONG SAID RIGHT OF WAY LINE, 363 FEET TO THE SOUTHEAST CORNER OF THE LAND CONVEYED BY W.F. ZIEGLER AND OLIVA M. ZIEGLER BY DEED RECORDED IN BOOK 677, PAGE 159, OFFICIAL RECORDS; THENCE NORTHERLY AT RIGHT ANGLES ALONG THE EASTERLY LINE OF THE LAND CONVEYED BY DEED JUST REFERRED TO, 120 FEET; THENCE EASTERLY, PARALLEL WITH SAID NORTHERN RIGHT OF WAY LINE, 363 FEET; THENCE SOUTHERLY AT RIGHT ANGLES, 120 FEET TO THE POINT OF BEGINNING.
ALSO EXCEPTING THEREFROM:
FIRST: A STRIP OF LAND, 50 FEET WIDE, LYING SOUTH OF AND ADJACENT TO THE SOUTHERN PACIFIC RAILWAY COMPANY’S 200-FOOT RIGHT OF WAY THROUGH SECTION 16, TOWNSHIP 5 NORTH, RANGE 14 EAST, SAN BERNARDINO BASE AND MERIDIAN.
SECOND: A PIECE OR PARCEL OF LAND LYING IN THE SOUTHEAST ONE-QUARTER OF SAID SECTION 16, BOUNDED AND DESCRIBED AS FOLLOWS:
BEGINNING AT A POINT IN THE SOUTHERLY BOUNDARY OF THE ABOVE DESCRIBED PIECE OF LAND, DISTANT 770 FEET WESTERLY ALONG SAID SOUTHERLY LINE FROM THE EAST LINE OF SAID SECTION 16;
THENCE SOUTHWESTERLY ALONG SAID SOUTHERLY LINE FROM THE EAST LINE OF SAID SECTION 16: THENCE SOUTHWESTERLY ON A CURVE CONCAVE SOUTHEASTERLY, WITH A RADIUS OF 739.49 FEET, A DISTANCE OF 750 FEET; THENCE SOUTH 5° 24’ WEST, A DISTANCE OF 1481 FEET, MORE OR LESS, TO A POINT IN THE SOUTH LINE OF SAID SECTION 16; THENCE WEST ALONG SAID SOUTH LINE, 50.2 FEET; THENCE NORTH 5° 24’ EAST, A DISTANCE OF 2389 FEET; THENCE NORTHWESTERLY ON A CURVE CONCAVE SOUTHWESTERLY WITH A RADIUS OF 739.49 FEET, A DISTANCE OF 998 FEET, MORE OR LESS, TO A POINT IN THE SOUTHERLY BOUNDARY LINE OF THE ABOVE FIRST DESCRIBED PIECE OF LAND; THENCE EASTERLY ALONG SAID SOUTHERLY BOUNDARY LINE, A DISTANCE OF 975 FEET, MORE OR LESS, TO THE POINT OF BEGINNING.
PARCEL 16: (645-091-09)
THE WEST HALF OF THE NORTHWEST QUARTER OF THE NORTHWEST QUARTER OF SECTION 12, TOWNSHIP 2 NORTH, RANGE 18 EAST, SAN BERNARDINO BASE AND MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPTING THEREFROM ONE-FOURTH OF ALL MINERALS, OIL, GAS, CARBON AND HYDROCARBON SUBSTANCES ON AND UNDER SAID LAND, AS RESERVED IN THE DEED FROM HOMER S. KNOWLES, ET UX., RECORDED JANUARY 13, 1958 IN BOOK 4410 PAGE 475 OFFICIAL RECORDS.
ALSO EXCEPTING THEREFROM ONE-FOURTH OF ALL MINERALS, OIL, GAS, CARBON AND HYDROCARBON SUBSTANCES ON AND UNDER SAID LAND, AS RESERVED IN THE DEED FROM JOAN L. ZMINA, TRUSTEE, RECORDED OCTOBER 12, 1994 AS INSTRUMENT NO. 94-415289 OFFICIAL RECORDS.
PARCEL 17: (645-121-06)
THE NORTH 1/2 OF THE NORTHWEST 1/4 OF THE SOUTHEAST 1/4 OF SECTION 36, TOWNSHIP 2 NORTH, RANGE 18, EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPTING ALL OIL, GAS, OIL SHALE, COAL, PHOSPHATE, SODIUM, GOLD, SILVER AND ALL OTHER MINERAL DEPOSITS CONTAINED IN SAID LAND, TOGETHER WITH THE RIGHT TO DRILL FOR AND EXTRACT SUCH DEPOSITS OF OIL AND GAS, OR GAS, AND TO PROSPECT FOR, MINE, AND REMOVE SUCH DEPOSITS OF OTHER MINERALS FROM SAID LAND, AND TO OCCUPY AND USE SO MUCH OF THE SURFACE OF SAID LAND AS MAY BE REQUIRED THEREFOR, UPON, COMPLIANCE WITH THE CONDITIONS AND SUBJECT TO THE PROVISIONS AND LIMITATIONS OF CHAPTER 5, PART I, DIVISION 6 OF THE PUBLIC RESOURCES CODE, AS RESERVED TO THE STATE OF CALIFORNIA, BY PATENT RECORDED APRIL 12, 1960, IN BOOK 5109, OF OFFICIAL RECORDS, PAGE 174.
A-5
ALSO EXCEPTING THEREFROM A STRIP OF LAND 200 FEET IN WIDTH IN THE SOUTHEAST QUARTER OF SECTION 36, TOWNSHIP 2 NORTH, RANGE 18 EAST, SAN BERNARDINO BASE AND MERIDIAN, LYING 100 FEET ON EACH SIDE OF THE FOLLOWING DESCRIBED CENTER LINE, EXTENDED:
BEGINNING AT A POINT ON THE SOUTH LINE OF SAID SECTION 36, SAID POINT BEING LOCATED NORTH 46° 03’ WEST 45,738.1 FEET FROM THE SOUTHEAST CORNER OF SECTION 36, TOWNSHIP 1 NORTH, RANGE 19 EAST, SAN BERNARDINO MERIDIAN; THENCE NORTH 47° 57’ WEST 2500 FEET, MORE OR LESS, TO A POINT ON THE WEST LINE THE SOUTHEAST QUARTER OF SECTION 36, TOWNSHIP 2 NORTH, RANGE 18 EAST, SAN BERNARDINO MERIDIAN, AS GRANTED TO THE ARIZONA AND CALIFORNIA RAILWAY COMPANY BY PERMIT DATED FEBRUARY 4, 1910, EXECUTED BY THE SURVEYOR GENERAL OF THE STATE OF CALIFORNIA PURSUANT TO SECTION 478 OF THE CALIFORNIA CIVIL CODE.
PARCEL 18: (645-271-03)
THE NORTH 1/2 OF THE NORTHWEST 1/4 OF THE NORTHWEST 1/4 OF SECTION 16, TOWNSHIP 2 NORTH, RANGE 18 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPTING ALL OIL, GAS, OIL SHALE, COAL, PHOSPHATE, SODIUM, GOLD, SILVER AND ALL OTHER MINERAL DEPOSITS CONTAINED IN SAID LAND, TOGETHER WITH THE RIGHT TO DRILL FOR AND EXTRACT DEPOSITS OF OIL AND GAS, OR GAS, AND TO PROSPECT FOR, MINE, AND REMOVE SUCH DEPOSITS OF OTHER MINERALS FROM SAID LAND, AND TO OCCUPY AND USE SO MUCH OF THE SURFACE OF SAID LAND AS MAY BE REQUIRED THEREFOR, UPON, COMPLIANCE WITH THE CONDITIONS AND SUBJECT TO THE PROVISIONS AND LIMITATIONS OF CHAPTER 5, PART I, DIVISION 6 OF THE PUBLIC RESOURCES CODE, AS RESERVED TO THE STATE OF CALIFORNIA, BY PATENT RECORDED APRIL 12, 1960, IN BOOK 5109, OF OFFICIAL RECORDS, PAGE 174.
ALSO EXCEPT THOSE PORTIONS OF A STRIP OF LAND 400 FEET IN WIDTH WHICH ARE LOCATED WITHIN THE NORTHWEST QUARTER AND THE SOUTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 16, TOWNSHIP 2 NORTH, RANGE 18 EAST, SAN BERNARDINO MERIDIAN, CONTAINED BETWEEN TWO LINES DRAWN FROM THE NORTH LINE OF SAID SECTION 16, TO THE SOUTH LINE OF SAID SECTION 16, ONE LINE BEING LOCATED 70 FEET NORTHWESTERLY FROM AND THE OTHER LINE BEING LOCATED 330 FEET SOUTHEASTERLY FROM AND BOTH LINES BEING PARALLEL TO THE FOLLOWING DESCRIBED LINE, EXTENDED:
BEGINNING AT A POINT ON THE NORTH LINE OF SAID SECTION 16, SAID POINT BEING LOCATED SOUTH 89° 42’ 40” EAST 1112.42 FEET FROM THE NORTHWEST CORNER OF SAID SECTION 16; THENCE SOUTH 11° 10’ 04” WEST 5348.94 FEET, MORE OR LESS, TO A POINT ON THE SOUTH LINE OF SAID SECTION WHICH IS LOCATED SOUTH 89° 14’ 56” EAST 147.60 FEET FROM THE SOUTHWEST CORNER OF SAID SECTION 16, AS GRANTED TO THE METROPOLITAN WATER DISTRICT OF SOUTHERN CALIFORNIA BY INSTRUMENT DATED SEPTEMBER 15, 1934, EXECUTED ON BEHALF OF THE STATE OF CALIFORNIA BY THE CHIEF OF THE DIVISION OF STATE LANDS PURSUANT TO THE PROVISIONS OF CHAPTER 507 OF THE STATUTES OF CALIFORNIA, 1933.
PARCEL 19: (645-271-11)
THE NORTH 1/2 OF THE SOUTHWEST 1/4 OF THE NORTHWEST 1/4 OF SECTION 16, TOWNSHIP 2 NORTH, RANGE 18 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPTING ALL OIL, GAS, OIL SHALE, COAL, PHOSPHATE, SODIUM, GOLD, SILVER AND ALL OTHER MINERAL DEPOSITS CONTAINED IN SAID LAND, TOGETHER WITH THE RIGHT TO DRILL FOR AND EXTRACT SUCH DEPOSITS OF OIL AND GAS, OR GAS, AND TO PROSPECT FOR, MINE, AND REMOVE SUCH DEPOSITS OF OTHER MINERALS FROM SAID LAND, AND TO OCCUPY AND USE SO MUCH OF THE SURFACE OF SAID LAND AS MAY BE REQUIRED THEREFOR, UPON, COMPLIANCE WITH THE CONDITIONS AND SUBJECT TO THE PROVISIONS AND LIMITATIONS OF CHAPTER 5, PART I, DIVISION 6 OF THE PUBLIC RESOURCES CODE, AS RESERVED TO THE STATE OF CALIFORNIA, BY PATENT RECORDED APRIL 12, 1960, IN BOOK 5109, OF OFFICIAL RECORDS, PAGE 174.
A-6
ALSO EXCEPT THOSE PORTIONS OF A STRIP OF LAND 400 FEET IN WIDTH WHICH ARE LOCATED WITHIN THE NORTHWEST QUARTER AND THE SOUTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 16, TOWNSHIP 2 NORTH, RANGE 18 EAST, SAN BERNARDINO MERIDIAN, CONTAINED BETWEEN TWO LINES DRAWN FROM THE NORTH LINE OF SAID SECTION 16, TO THE SOUTH LINE OF SAID SECTION 16, ONE LINE BEING LOCATED 70 FEET NORTHWESTERLY FROM AND THE OTHER LINE BEING LOCATED 330 FEET SOUTHEASTERLY FROM THE BOTH LINES BEING PARALLEL TO THE FOLLOWING DESCRIBED LINE, EXTENDED:
BEGINNING AT A POINT ON THE NORTH LINE OF SAID SECTION 16, SAID POINT BEING LOCATED SOUTH 89° 42’ 40” EAST 1112.42 FEET FROM THE NORTHWEST CORNER OF SAID SECTION 16; THENCE SOUTH 110 10’ 04” WEST 5348.94 FEET, MORE OR LESS, TO A POINT ON THE SOUTH LINE OF SAID SECTION WHICH IS LOCATED SOUTH 89° 14’ 56” EAST 147.60 FEET FROM THE SOUTHWEST CORNER OF SAID SECTION 16, AS GRANTED TO THE METROPOLITAN WATER DISTRICT OF SOUTHERN CALIFORNIA BY INSTRUMENT DATED SEPTEMBER 15, 1934, EXECUTED ON BEHALF OF THE STATE OF CALIFORNIA BY THE CHIEF OF THE DIVISION OF STATE LANDS PURSUANT TO THE PROVISIONS OF CHAPTER 507 OF THE STATUTES OF CALIFORNIA, 1933.
ALSO EXCEPT THOSE PORTIONS OF A STRIP OF LAND 200 FEET IN WIDTH WHICH ARE LOCATED WITHIN THE SOUTHWEST QUARTER OF THE NORTHWEST QUARTER AND THE SOUTHWEST QUARTER OF THE SOUTHEAST QUARTER OF SECTION 16, TOWNSHIP 2 NORTH, RANGE 18 EAST, SAN BERNARDINO MERIDIAN, LYING 100 FEET ON EACH SIDE OF THE FOLLOWING DESCRIBED CENTER LINE EXTENDED:
BEGINNING AT A POINT ON THE SOUTH LINE OF SAID SECTION 16, SAID POINT BEING LOCATED NORTH 46° 42” WEST 69,424.5 FEET FROM THE SOUTHEAST CORNER OF SECTION 36, TOWNSHIP 1 NORTH, RANGE 19 EAST, SAN BERNARDINO MERIDIAN;
THENCE NORTH 47° 57’ WEST 3879.8 FEET, MORE OR LESS, TO A POINT ON THE WEST LINE OF SAID SECTION 16, AS GRANTED TO THE ARIZONA AND CALIFORNIA RAILWAY COMPANY BY PERMIT DATED FEBRUARY 4, 1910, EXECUTED BY THE SURVEYOR GENERAL OF THE STATE OF CALIFORNIA PURSUANT TO SECTION 478 OF THE CALIFORNIA CIVIL CODE.
PARCEL 20: (645-271-13)
THE NORTH 1/2 OF THE SOUTHWEST 1/4 OF THE NORTHEAST 1/4 OF SECTION 16, TOWNSHIP 2 NORTH, RANGE 18 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPTING ALL OIL, GAS, OIL SHALE, COAL, PHOSPHATE, SODIUM, GOLD, SILVER AND ALL OTHER MINERAL DEPOSITS CONTAINED IN SAID LAND, TOGETHER WITH THE RIGHT TO DRILL FOR AND EXTRACT SUCH DEPOSITS OF OIL AND GAS, OR GAS, AND TO PROSPECT FOR, MINE, AND REMOVE DEPOSITS OF OTHER MINERALS FROM SAID LAND, AND TO OCCUPY AND USE SO MUCH OF THE SURFACE OF SAID LAND AS MAY BE REQUIRED THEREFOR, UPON, COMPLIANCE WITH THE CONDITIONS AND SUBJECT TO THE PROVISIONS AND LIMITATIONS OF CHAPTER 5, PART I, DIVISION 6 OF THE PUBLIC RESOURCES CODE, AS RESERVED TO THE STATE OF CALIFORNIA, BY PATENT RECORDED APRIL 12, 1960, IN BOOK 5109, OF OFFICIAL RECORDS, PAGE 174.
PARCEL 21: (645-271-23)
THE NORTH 1/2 OF THE SOUTHWEST 1/4 OF THE SOUTHWEST 1/4 OF SECTION 16, TOWNSHIP 2 NORTH, RANGE 18 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPTING ALL OIL, GAS, OIL SHALE, COAL, PHOSPHATE, SODIUM, GOLD, SILVER AND ALL OTHER MINERAL DEPOSITS CONTAINED IN SAID LAND, TOGETHER WITH THE RIGHT TO DRILL FOR AND EXTRACT SUCH DEPOSITS OF OIL AND GAS, OR GAS, AND TO PROSPECT FOR, MINE, AND REMOVE SUCH DEPOSITS OF OTHER MINERALS FROM SAID LAND, AND TO OCCUPY AND USE SO MUCH OF THE SURFACE OF SAID LAND AS MAY BE REQUIRED THEREFOR, UPON, COMPLIANCE WITH THE CONDITIONS AND SUBJECT TO THE PROVISIONS AND LIMITATIONS OF CHAPTER 5, PART I, DIVISION 6 OF THE PUBLIC RESOURCES CODE, AS RESERVED TO THE STATE OF CALIFORNIA, BY PATENT RECORDED APRIL 12, 1960, IN BOOK 5109, OF OFFICIAL RECORDS, PAGE 174.
A-7
ALSO EXCEPT THOSE PORTIONS OF A STRIP OF LAND 400 FEET IN WIDTH WHICH ARE LOCATED WITHIN THE NORTHWEST QUARTER AND THE SOUTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 16, TOWNSHIP 2 NORTH, RANGE 18 EAST, SAN BERNARDINO MERIDIAN, CONTAINED BETWEEN TWO LINES DRAWN FROM THE NORTH LINE OF SAID SECTION 16, TO THE SOUTH LINE OF SAID SECTION 16, ONE LINE BEING LOCATED 70 FEET NORTHWESTERLY FROM AND THE OTHER LINE BEING LOCATED 330 FEET SOUTHEASTERLY FROM AND BOTH LINES BEING PARALLEL TO THE FOLLOWING DESCRIBED LINE, EXTENDED:
BEGINNING AT A POINT ON THE NORTH LINE OF SAID SECTION 16, SAID POINT BEING LOCATED SOUTH 89° 42 40” EAST 1112.42 FEET FROM THE NORTHWEST CORNER OF SAID SECTION 16; THENCE SOUTH 11° 10’ 04” WEST 5348.94 FEET, MORE OR LESS, TO A POINT ON THE SOUTH LINE OF SAID SECTION WHICH IS LOCATED SOUTH 89° 14’ 56” EAST 147.60 FEET FROM THE SOUTHWEST CORNER OF SAID SECTION 16, AS GRANTED TO THE METROPOLITAN WATER DISTRICT OF SOUTHERN CALIFORNIA BY INSTRUMENT DATED SEPTEMBER 15, 1934, EXECUTED ON BEHALF OF THE STATE OF CALIFORNIA BY THE CHIEF OF THE DIVISION OF STATE LANDS PURSUANT TO THE PROVISIONS OF CHAPTER 507 OF THE STATUTES OF CALIFORNIA, 1933.
PARCEL 22: (645-121-05)
THE NORTH 1/2 OF THE NORTHEAST 1/4 OF THE SOUTHEAST 1/4 OF SECTION 36, TOWNSHIP 2 NORTH, RANGE 18 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPTING ALL OIL, GAS, OIL SHALE, COAL, PHOSPHATE, SODIUM, GOLD, SILVER AND ALL OTHER MINERAL DEPOSITS CONTAINED IN SAID LAND, TOGETHER WITH THE RIGHT TO DRILL FOR AND EXTRACT SUCH DEPOSITS OF OIL AND GAS, OR GAS, AND TO PROSPECT FOR, MINE, AND REMOVE SUCH DEPOSITS OF OTHER MINERALS FROM SAID LAND, AND TO OCCUPY AND USE SO MUCH OF THE SURFACE OF SAID LAND AS MAY BE REQUIRED THEREFOR, UPON, COMPLIANCE WITH THE CONDITIONS AND SUBJECT TO THE PROVISIONS AND LIMITATIONS OF CHAPTER 5, PART I, DIVISION 6 OF THE PUBLIC RESOURCES CODE, AS RESERVED TO THE STATE OF CALIFORNIA, BY PATENT RECORDED APRIL 12, 1960, IN BOOK 5109, OF OFFICIAL RECORDS, PAGE 174.
PARCEL 23: (645-121-09)
THE NORTH 1/2 OF THE SOUTHEAST 1/4 OF THE SOUTHEAST 1/4 OF SECTION 36, TOWNSHIP 2 NORTH, RANGE 18 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPTING ALL OIL, GAS, OIL SHALE, COAL, PHOSPHATE, SODIUM, GOLD, SILVER AND ALL OTHER MINERAL DEPOSITS CONTAINED IN SAID LAND, TOGETHER WITH THE RIGHT TO DRILL FOR AND EXTRACT SUCH DEPOSITS OF OIL AND GAS, OR GAS, AND TO PROSPECT FOR, MINE, AND REMOVE SUCH DEPOSITS OF OTHER MINERALS FROM SAID LAND, AND TO OCCUPY AND USE SO MUCH OF THE SURFACE OF SAID LAND AS MAY BE REQUIRED THEREFOR, UPON, COMPLIANCE WITH THE CONDITIONS AND SUBJECT TO THE PROVISIONS AND LIMITATIONS OF CHAPTER 5, PART I, DIVISION 6 OF THE PUBLIC RESOURCES CODE, AS RESERVED TO THE STATE OF CALIFORNIA, BY PATENT RECORDED APRIL 12, 1960, IN BOOK 5109, OF OFFICIAL RECORDS, PAGE 174.
ALSO EXCEPTING THEREFROM A STRIP OF LAND 200 FEET IN WIDTH IN THE SOUTHEAST QUARTER OF SECTION 36, TOWNSHIP 2 NORTH, RANGE 18 EAST, SAN BERNARDINO BASE AND MERIDIAN, LYING 100 FEET ON EACH SIDE OF THE FOLLOWING DESCRIBED CENTER LINE, EXTENDED:
BEGINNING AT A POINT ON THE SOUTH LINE OF SAID SECTION 16, SAID POINT BEING LOCATED NORTH 46° 03’ WEST 45,738,1 FEET FROM THE SOUTHEAST CORNER OF SECTION 36, TOWNSHIP 1 NORTH, RANGE 19 EAST, SAN BERNARDINO MERIDIAN; THENCE NORTH 47° 57’ WEST 2500 FEET, MORE OR LESS, TO A POINT ON THE WEST LINE OF THE SOUTHEAST QUARTER OF SAID SECTION 36, TOWNSHIP 2 NORTH, RANGE 18 EAST, SAN BERNARDINO MERIDIAN, AS GRANTED TO THE ARIZONA AND CALIFORNIA RAILWAY COMPANY BY PERMIT DATED FEBRUARY 4, 1910, EXECUTED BY THE SURVEYOR GENERAL OF THE STATE OF CALIFORNIA PURSUANT TO SECTION 478 OF THE CALIFORNIA CIVIL CODE.
A-8
PARCEL 24: (645-271-07)
THE SOUTH 1/2 OF THE NORTHEAST 1/4 OF THE NORTHEAST 1/4 OF SECTION 16, TOWNSHIP 2 NORTH, RANGE 18 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPTING ALL OIL, GAS, OIL SHALE, COAL, PHOSPHATE, SODIUM, GOLD, SILVER AND ALL OTHER MINERAL DEPOSITS CONTAINED IN SAID LAND, TOGETHER WITH THE RIGHT TO DRILL FOR AND EXTRACT SUCH DEPOSITS OF OIL AND GAS, OR GAS, AND TO PROSPECT FOR, MINE, AND REMOVE SUCH DEPOSITS OF OTHER MINERALS FROM SAID LAND, AND TO OCCUPY AND USE SO MUCH OF THE SURFACE OF SAID LAND AS MAY BE REQUIRED THEREFOR, UPON, COMPLIANCE WITH THE CONDITIONS AND SUBJECT TO THE PROVISIONS AND LIMITATIONS OF CHAPTER 5, PART I, DIVISION 6 OF THE PUBLIC RESOURCES CODE, AS RESERVED TO THE STATE OF CALIFORNIA, BY PATENT RECORDED APRIL 12, 1960, IN BOOK 5109, OF OFFICIAL RECORDS, PAGE 174.
PARCEL 25: (645-271-15)
THE SOUTH 1/2 OF THE SOUTHEAST 1/4 OF THE NORTHEAST 1/4 OF SECTION 16, TOWNSHIP 2 NORTH, RANGE 18 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPTING ALL OIL, GAS, OIL SHALE, COAL, PHOSPHATE, SODIUM, GOLD, SILVER AND ALL OTHER MINERAL DEPOSITS CONTAINED IN SAID LAND, TOGETHER WITH THE RIGHT TO DRILL FOR AND EXTRACT SUCH DEPOSITS OF OIL AND GAS, OR GAS, AND TO PROSPECT FOR, MINE, AND REMOVE SUCH DEPOSITS OF OTHER MINERALS FROM SAID LAND, AND TO OCCUPY AND USE SO MUCH OF THE SURFACE OF SAID LAND AS MAY BE REQUIRED THEREFOR, UPON, COMPLIANCE WITH THE CONDITIONS AND SUBJECT TO THE PROVISIONS AND LIMITATIONS OF CHAPTER 5, PART I, DIVISION 6 OF THE PUBLIC RESOURCES CODE, AS RESERVED TO THE STATE OF CALIFORNIA, BY PATENT RECORDED APRIL 12, 1960, IN BOOK 5109, OF OFFICIAL RECORDS, PAGE 174.
PARCEL 26: (645-271-08)
THE SOUTH 1/2 OF THE NORTHWEST 1/4 OF THE NORTHEAST 1/4 OF SECTION 16, TOWNSHIP 2 NORTH, RANGE 18 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPTING ALL OIL, GAS, OIL SHALE, COAL, PHOSPHATE, SODIUM, GOLD, SILVER AND ALL OTHER MINERAL DEPOSITS CONTAINED IN SAID LAND, TOGETHER WITH THE RIGHT TO DRILL FOR AND EXTRACT SUCH DEPOSITS OF OIL AND GAS, OR GAS, AND TO PROSPECT FOR, MINE, AND REMOVE SUCH DEPOSITS OF OTHER MINERALS FROM SAID LAND, AND TO OCCUPY AND USE SO MUCH OF THE SURFACE OF SAID LAND AS MAY BE REQUIRED THEREFOR, UPON, COMPLIANCE WITH THE CONDITIONS AND SUBJECT TO THE PROVISIONS AND LIMITATIONS OF CHAPTER 5, PART I, DIVISION 6 OF THE PUBLIC RESOURCES CODE, AS RESERVED TO THE STATE OF CALIFORNIA, BY PATENT RECORDED APRIL 12, 1960, IN BOOK 5109, OF OFFICIAL RECORDS, PAGE 174.
PARCEL 27: (645-271-05)
THE NORTH 1/2 OF THE NORTHWEST 1/4 OF THE NORTHEAST 1/4 OF SECTION 16, TOWNSHIP 2 NORTH, RANGE 18 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPTING ALL OIL, GAS, OIL SHALE, COAL, PHOSPHATE, SODIUM, GOLD, SILVER AND ALL OTHER MINERAL DEPOSITS CONTAINED IN SAID LAND, TOGETHER WITH THE RIGHT TO DRILL FOR AND EXTRACT SUCH DEPOSITS OF OIL AND GAS, OR GAS, AND TO PROSPECT FOR, MINE, AND REMOVE SUCH DEPOSITS OF OTHER MINERALS FROM SAID LAND, AND TO OCCUPY AND USE SO MUCH OF THE SURFACE OF SAID LAND AS MAY BE REQUIRED THEREFOR, UPON, COMPLIANCE WITH THE CONDITIONS AND SUBJECT TO THE PROVISIONS AND LIMITATIONS OF CHAPTER 5, PART I, DIVISION 6 OF THE PUBLIC RESOURCES CODE, AS RESERVED TO THE STATE OF CALIFORNIA, BY PATENT RECORDED APRIL 12, 1960, IN BOOK 5109, OF OFFICIAL RECORDS, PAGE 174.
A-9
PARCEL 28: (645-071-18)
ALL OF SECTION 36, TOWNSHIP 3 NORTH, RANGE 18 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO GOVERNMENT SURVEY.
EXCEPTING THEREFROM ALL MINERALS AND MINERAL DEPOSITS, INCLUDING, BUT NOT LIMITED TO, OIL AND GAS, OTHER GASES, INCLUDING BUT NOT LIMITED TO NONHYDROCARBON AND GEOTHERMAL GASES, OIL SHALE, COAL, PHOSPHATE, ALUMINA, SILICA, FOSSILS OF ALL GEOLOGICAL AGES, SODIUM, GOLD, SILVER, METALS AND THEIR COMPOUNDS, ALKALI, ALKALI EARTH, SAND, CLAY, GRAVEL, SALTS AND MINERAL WATERS, URANIUM, TRONA, AND GEOTHERMAL RESOURCES, TOGETHER WITH THE RIGHT OF THE STATE OR PERSONS AUTHORIZED BY THE STATE TO PROSPECT FOR, DRILL FOR, EXTRACT, MINE AND REMOVE SUCH DEPOSITS OR RESOURCES, AND TO OCCUPY AND USE SO MUCH OF THE SURFACE OF THE LANDS AS MAY BE NECESSARY THEREFOR, AS RESERVED IN THE PATENT FROM THE STATE OF CALIFORNIA, RECORDED MARCH 21, 1995 AS INSTRUMENT NO. 95-085121, OFFICIAL RECORDS.
PARCEL 29: (645-091-10)
THE EAST ONE-HALF OF THE NORTHWEST ONE-QUARTER OF THE NORTHWEST ONE-QUARTER SECTION 12, TOWNSHIP 2 NORTH, RANGE 18 EAST, SAN BERNARDINO BASE AND MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPTING THEREFROM ONE-QUARTER OF ALL MINERALS, OIL, GAS, CARBONS AND HYDROCARBON SUBSTANCES ON AND UNDER SAID LAND, AS RESERVED IN THE DEED FROM HOMER S. KNOWLES, ETUX, RECORDED JANUARY 16, 1958 IN BOOK 4414 PAGE 237 OFFICIAL RECORDS.
ALSO EXCEPTING THEREFROM ONE-FOURTH OF ALL MINERALS, OIL, GAS, CARBONS AND HYDROCARBON SUBSTANCES ON AND UNDER SAID LAND, AS RESERVED IN THE DEED FROM CAROL 0. ALLEN, ET AL., RECORDED OCTOBER 7, 1994 AS INSTRUMENT NO. 94-411051 OFFICIAL RECORDS.
PARCEL 30: (645-091-06)
THE NORTH HALF OF THE NORTHWEST QUARTER OF THE SOUTHWEST QUARTER, SECTION 12, TOWNSHIP 2 NORTH, RANGE 18 EAST, SAN BERNARDINO BASE AND MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPTING THEREFROM 50% OF ALL OIL, GAS, MINERAL, URANIUM, AND OTHER HYDROCARBON SUBSTANCES IN AND UNDER SAID LAND, AS RESERVED IN THE DEED RECORDED JUNE 7, 1962, IN BOOK 5712, PAGE 338, OFFICIAL RECORDS.
PARCEL 31: (645-271-06)
THE NORTH 1/2 OF THE NORTHEAST 1/4 OF THE NORTHEAST 1/4 OF SECTION 16, TOWNSHIP 2 NORTH, RANGE 18 EAST, SAN BERNARDINO BASE AND MERIDIAN.
EXCEPTING THEREFROM ALL OIL, GAS, OIL SHALE, COAL, PHOSPHATE, SODIUM, GOLD, SILVER AND ALL OTHER MINERAL DEPOSITS, CONTAINED IN SAID LANDS, AND FURTHER RESERVING TO THE STATE OF CALIFORNIA AND PERSONS AUTHORIZED BY THE STATE, THE RIGHT TO DRILL FOR AND EXTRACT SUCH DEPOSITS OF OIL AND GAS, OR GAS AND TO PROSPECT FOR, MINE AND REMOVE SUCH DEPOSITS OF OTHER MINERALS FROM SAID LANDS AND TO OCCUPY AND USE SO MUCH OF THE SURFACE OF SAID LANDS AS MAY BE REQUIRED THEREFOR, UPON COMPLIANCE WITH THE CONDITIONS AND SUBJECT TO THE PROVISIONS AND LIMITATIONS OF CHAPTER 5, PART I, DIVISION 6 OF THE PUBLIC RESOURCES CODE, AS RESERVED IN THE PATENT RECORDED APRIL 12, 1960 IN BOOK 5109, PAGE 174, OFFICIAL RECORDS.
A-10
PARCEL 32: (645-271-18)
THE SOUTH 1/2 OF THE SOUTHWEST 1/4 OF THE NORTHWEST 1/4 OF SECTION 16, TOWNSHIP 2 NORTH, RANGE 18 EAST, SAN BERNARDINO BASE AND MERIDIAN.
EXCEPTING THEREFROM THOSE PORTIONS OF A STRIP OF LAND 400 FEET IN WIDTH WHICH ARE LOCATED WITHIN THE NORTHWEST 1/4 AND THE SOUTHWEST 1/4 OF THE SOUTHWEST 1/4 OF SECTION 16, TOWNSHIP 2 NORTH, RANGE 18 EAST, SAN BERNARDINO BASE AND MERIDIAN, CONTAINED BETWEEN TWO LINES DRAWN FROM THE NORTH LINE OF SAID SECTION 16 TO THE SOUTH LINE OF SAID SECTION 16, ONE BEING LOCATED 70 FEET NORTHWESTERLY FROM AND THE OTHER LINE BEING LOCATED 330 FEET SOUTHWESTERLY FROM AND BOTH LINES BEING PARALLEL TO THE FOLLOWING DESCRIBED LINE, EXTENDED:
BEGINNING AT A POINT ON THE NORTH LINE OF SAID SECTION 16, SAID POINT BEING LOCATED SOUTH 89° 42’ 40” EAST, 1112.42 FEET FROM THE NORTHWEST CORNER OF SAID SECTION 16; THENCE SOUTH 11° 10’ 04” WEST, 5348.94 FEET, MORE OR LESS, TO A POINT ON THE SOUTH LINE OF SAID SECTION, WHICH IS LOCATED SOUTH 89° 14’ 56” EAST, 147.60 FEET FROM THE SOUTHWEST CORNER OF SAID SECTION 16, AS GRANTED TO THE METROPOLITAN WATER DISTRICT OF SOUTHERN CALIFORNIA, BY INSTRUMENT DATED SEPTEMBER 15, 1934, RECORDED SEPTEMBER 26, 1954 IN BOOK 996, PAGE 160, OFFICIAL RECORDS, EXECUTED ON BEHALF OF THE STATE OF CALIFORNIA BY THE CHIEF OF THE DIVISION OF STATE LANDS PURSUANT TO THE PROVISIONS OF CHAPTER 507 OF THE STATUTES OF CALIFORNIA, 1933.
EXCEPTING THEREFROM ALL OIL, GAS, OIL SHALE, COAL, PHOSPHATE, SODIUM, GOLD, SILVER AND ALL OTHER MINERAL DEPOSITS, CONTAINED IN SAID LANDS, AND FURTHER RESERVING TO THE STATE OF CALIFORNIA AND PERSONS AUTHORIZED BY THE STATE, THE RIGHT TO DRILL FOR AND EXTRACT SUCH DEPOSITS OF OIL AND GAS, OR GAS, AND TO PROSPECT FOR, MINE AND REMOVE SUCH DEPOSITS OF OTHER MINERALS FROM SAID LANDS AND TO OCCUPY AND USE SO MUCH OF THE SURFACE OF SAID LANDS AS MAY BE REQUIRED THEREFOR, UPON COMPLIANCE WITH THE CONDITIONS AND SUBJECT TO THE PROVISIONS AND LIMITATIONS OF CHAPTER 5, PART I, DIVISION 6 OF THE PUBLIC RESOURCES CODE, AS RESERVED IN THE PATENT RECORDED APRIL 12, 1960 IN BOOK 5109, PAGE 174, OFFICIAL RECORDS.
PARCEL 33: (645-271-10)
THE SOUTH 1/2 OF THE NORTHWEST 1/4 OF THE NORTHWEST 1/4 OF SECTION 16, TOWNSHIP 2 NORTH, RANGE 18 EAST, SAN BERNARDINO BASE AND MERIDIAN.
EXCEPTING THEREFROM THOSE PORTIONS OF A STRIP OF LAND 400 FEET IN WIDTH WHICH ARE LOCATED WITHIN THE NORTHWEST 1/4 AND THE SOUTHWEST 1/4 OF THE SOUTHWEST 1/4 OF SECTION 16, TOWNSHIP 2 NORTH, RANGE 18 EAST, SAN BERNARDINO BASE AND MERIDIAN, CONTAINED BETWEEN TWO LINES DRAWN FROM THE NORTH LINE OF SAID SECTION 16 TO THE SOUTH LINE OF SAID SECTION 16, ONE LINE BEING LOCATED 70 FEET NORTHWESTERLY FROM AND THE OTHER BEING LOCATED 330 FEET SOUTHWESTERLY FROM AND BOTH LINES BEING PARALLEL TO THE FOLLOWING DESCRIBED LINE, EXTENDED:
BEGINNING AT A POINT ON THE NORTH LINE OF SAID SECTION 16, SAID POINT BEING LOCATED SOUTH 89° 42 40” EAST, 1112.42 FEET FROM THE NORTHWEST CORNER OF SAID SECTION 16; THENCE SOUTH 11° 10’ 04” WEST, 5348.94 FEET, MORE OR LESS, TO A POINT ON THE SOUTH LINE OF SAID SECTION, WHICH IS LOCATED SOUTH 89° 14’ 56” EAST, 147,60 FEET FROM THE SOUTHWEST CORNER OF SAID SECTION 16, AS GRANTED TO THE METROPOLITAN WATER DISTRICT OF SOUTHERN CALIFORNIA, BY INSTRUMENT DATED SEPTEMBER 15, 1934, RECORDED SEPTEMBER 26, 1954 IN BOOK 996, PAGE 160, OFFICIAL RECORDS EXECUTED ON BEHALF OF THE STATE OF CALIFORNIA BY THE CHIEF OF THE DIVISION OF STATE LANDS PURSUANT TO THE PROVISIONS OF CHAPTER 507 OF THE STATUTES OF CALIFORNIA, 1933.
FURTHER EXCEPTING THEREFROM THOSE PORTIONS OF A STRIP OF LAND 200 FEET IN WIDTH WHICH ARE LOCATED WITHIN THE SOUTHWEST 1/4 OF THE NORTHWEST 1/4 AND THE SOUTHWEST 1/4 OF THE SOUTHEAST 1/4 OF SECTION 16, TOWNSHIP 2 NORTH, RANGE 18 EAST, SAN BERNARDINO BASE AND MERIDIAN, LYING 100 FEET ON EACH SIDE OF THE FOLLOWING DESCRIBED CENTER LINE, EXTENDED:
BEGINNING AT A POINT ON THE SOUTH LINE OF SAID SECTION 16, SAID POINT BEING LOCATED NORTH 46° 42’ WEST, 69,424.5 FEET FROM THE SOUTHEAST CORNER OF SECTION 36, TOWNSHIP 1 NORTH, RANGE 19 EAST, SAN BERNARDINO BASE AND MERIDIAN; THENCE NORTH 47° 57’ WEST, 3879,8 FEET, MORE OR LESS, TO A POINT ON THE WEST LINE OF SAID SECTION 16, AS GRANTED TO THE ARIZONA AND CALIFORNIA RAILWAY COMPANY BY PERMIT DATED FEBRUARY 4, 1910, EXECUTED BY THE SURVEYOR GENERAL OF THE STATE OF CALIFORNIA, PURSUANT TO SECTION 478 OF THE CALIFORNIA CIVIL CODE.
A-11
EXCEPTING THEREFROM ALL OIL, GAS, OIL, SHALE, COAL, PHOSPHATE, SODIUM, GOLD, SILVER AND ALL OTHER MINERAL DEPOSITS, CONTAINED IN SAID LANDS, AND FURTHER RESERVING TO THE STATE OF CALIFORNIA AND PERSONS AUTHORIZED BY THE STATE, THE RIGHT TO DRILL FOR AND EXTRACT SUCH DEPOSITS OF OIL AND GAS, OR GAS, AND TO PROSPECT FOR, MINE AND REMOVE SUCH DEPOSITS OF OTHER MINERALS FROM SAID LANDS AND TO OCCUPY AND USE SO MUCH OF THE SURFACE OF SAID LANDS AS MAY BE REQUIRED THEREFOR, UPON COMPLIANCE WITH THE CONDITIONS AND SUBJECT TO THE PROVISIONS AND LIMITATIONS OF CHAPTER 5, PART I, DIVISION 6 OF THE PUBLIC RESOURCES CODE, AS RESERVED IN THE PATENT RECORDED APRIL 12, 1960 IN BOOK 5109, PAGE 174, OFFICIAL RECORDS.
PARCEL 34: (645-101-04)
THE NORTH ONE-HALF OF THE NORTHEAST ONE-QUARTER OF SECTION 23, TOWNSHIP 2 NORTH, RANGE 18 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
PARCEL 35: (645-271-16)
THE SOUTH HALF OF THE SOUTHWEST QUARTER OF THE NORTHEAST QUARTER OF SECTION 16, TOWNSHIP 2 NORTH, RANGE 18 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF ON FILE IN THE DISTRICT LAND OFFICE.
EXCEPT THEREFROM ALL OIL, GAS, OIL SHALE, COAL, PHOSPHATE, SODIUM, GOLD, SILVER AND ALL OTHER MINERAL DEPOSITS, CONTAINED IN SAID LAND, AND FURTHER RESERVING TO THE STATE OF CALIFORNIA AND PERSONS AUTHORIZED BY THE STATE, THE RIGHT TO DRILL FOR AND EXTRACT SUCH DEPOSITS OF OIL AND GAS, OR GAS, AND TO PROSPECT FOR, MINE AND REMOVE SUCH DEPOSITS OF OTHER MINERALS FROM SAID LANDS AND TO OCCUPY AND USE SO MUCH OF THE SURFACE OF SAID LANDS AS MAY BE REQUIRED THEREFOR, UPON COMPLIANCE WITH THE CONDITIONS AND SUBJECT TO THE PROVISIONS AND LIMITATIONS OF CHAPTER 5, PART I, DIVISION 6 OF THE PUBLIC RESOURCES CODE, AS RESERVED IN THE PATENT RECORDED APRIL 12, 1960, IN BOOK 5109, PAGE 174, OFFICIAL RECORDS.
DIVISION C:
PARCEL 36: (556-271-06)
SECTION 1, TOWNSHIP 5 NORTH, RANGE 13 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
PARCEL 37: (556-271-25, 26)
SECTION 13, TOWNSHIP 5 NORTH, RANGE 13 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPT THEREFROM THAT PORTION CONVEYED TO CALIFORNIA, ARIZONA, AND SANTA FE RAILWAY COMPANY BY DEED RECORDED MARCH 16, 1914 IN BOOK 548, OF DEEDS, PAGE 29.
ALSO EXCEPT THEREFROM THAT PORTION CONVEYED TO CALIFORNIA, ARIZONA AND SANTA FE RAILWAY COMPANY BY DEED RECORDED NOVEMBER 26, 1913 IN BOOK 542 OF DEEDS, PAGE 1.
PARCEL 38: (556-321-18)
SECTION 13, TOWNSHIP 4 NORTH, RANGE 14 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
A-12
PARCEL 39: (556-281-02,12)
SECTIONS 5 AND 9, TOWNSHIP 5 NORTH, RANGE 14 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
PARCEL 40: (556-301-06,07)
SECTION 13, TOWNSHIP 5 NORTH, RANGE 14 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPT THEREFROM THAT PORTION CONVEYED TO CALIFORNIA, ARIZONA, AND SANTA FE RAILWAY COMPANY BY DEED RECORDED MARCH 16, 1914 IN BOOK 548, OF DEEDS, PAGE 29. ALSO EXCEPT THEREFROM THAT PORTION CONVEYED TO CALIFORNIA, ARIZONA AND SANTA FE RAILWAY COMPANY BY DEED RECORDED NOVEMBER 26, 1913 IN BOOK 542, OF DEEDS, PAGE 1.
ALSO EXCEPT THEREFROM THAT PORTION CONVEYED TO CALIFORNIA, ARIZONA AND SANTA FE RAILWAY COMPANY BY DEED RECORDED AUGUST 8, 1936 IN BOOK 1155, PAGE 155 OF OFFICIAL RECORDS.
PARCEL 41: (556-311-17,41)
SECTIONS 25 AND 35, TOWNSHIP 5 NORTH, RANGE 14 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF. EXCEPT FROM SAID SECTION 25 THAT PORTION CONVEYED TO CALIFORNIA, ARIZONA, AND SANTA FE RAILWAY COMPANY BY DEED RECORDED JULY 18, 1914, IN BOOK 554 OF DEEDS, PAGE 155.
PARCEL 42: (653-021-14)
SECTION 17, TOWNSHIP 4 NORTH, RANGE 15 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
PARCEL 43: (653-041-23,24)
SECTION 5, TOWNSHIP 5 NORTH, RANGE 15 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPT THEREFROM THAT PORTION CONVEYED TO CALIFORNIA, ARIZONA AND SANTA FE RAILWAY COMPANY BY DEED RECORDED MARCH 16, 1914 IN BOOK 548, OF DEEDS, PAGE 29.
PARCEL 44: (653-041-10)
THE NORTH ONE-HALF AND THE WEST ONE-HALF OF THE WEST ONE-HALF OF THE NORTHWEST ONE-QUARTER OF THE SOUTHWEST ONE-QUARTER AND THE NORTHEAST ONE-QUARTER OF THE SOUTHEAST ONE-QUARTER AND THE SOUTHWEST ONE-QUARTER OF THE SOUTHEAST ONE-QUARTER AND THE EAST ONE-HALF OF THE NORTHWEST ONE-QUARTER OF THE SOUTHEAST ONE-QUARTER. AND THE EAST ONE-HALF OF THE WEST ONE-HALF OF THE NORTHWEST ONE-QUARTER OF THE SOUTHEAST ONE-QUARTER OF ALL IN SECTION 9, TOWNSHIP 5 NORTH, RANGE 15 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPTING THEREFROM ALL MINERALS AND MINERAL RIGHTS, INTERESTS, AND ROYALTIES, INCLUDING, WITHOUT LIMITING THE GENERALITY THEREOF, ALL OIL GAS AND OTHER HYDROCARBON SUBSTANCES, AS WELL AS ALL GEOTHERMAL RESOURCES, AND METALLIC OR OTHER SOLID MINERALS, TOGETHER WITH THE EXCLUSIVE AND PERPETUAL RIGHT OF GRANTOR, ITS SUCCESSORS, ASSIGNS AND LESSEES, OF INGRESS AND EGRESS IN, UPON AND OVER SAID LAND TO EXPLORE FOR, EXTRACT, STORE, REFINE, PROCESS, AND REMOVE THE SAME, AND MAKE SUCH USE OF SAID LAND AS IS NECESSARY OR USEFUL IN CONNECTION THEREWITH, TOGETHER WITH THE RIGHT TO USE SUCH WATER AS MAY BE FOUND ON OR BENEATH SAID LAND FOR EXTRACTION OR PROCESS ION OF SUCH MINERALS AS MAY BE FOUND THEREON. GRANTOR COVENANTS AND AGREES THAT IT WILL COMPENSATE THE OWNER OF THE SURFACE OF SAID LAND FOR SUCK PORTION THEREOF AS MAY BE TAKEN OR DAMAGED BY EXERCISE OF THE RIGHTS RETAINED BY GRANTOR, SUCH COMPENSATION TO BE AN AMOUNT EQUAL TO THE DIMINUTION OF THE FAIR MARKET VALUE OF SAID SURFACE ESTATE SO TAKEN OR DAMAGED, WHICH IN THE ABSENCE OF AGREEMENT, SHALL BE DETERMINED BY THE SUPERIOR COURT OF THE COUNTY IN WHICH SAID LAND IS LOCATED, IN THE MANNER PRESCRIBED FOR DETERMINATION OF VALUES OF REAL PROPERTY BEING ACQUIRED THROUGH EXERCISE OF THE POWER OF EMINENT DOMAIN, AS RESERVED IN THE DEED FROM SANTA FE PACIFIC REALTY CORPORATION, RECORDED OCTOBER 14, 1988, AS INSTRUMENT NO. 88-346016, OFFICIAL RECORDS.
A-13
PARCEL 45: (653-041-16)
SECTION 17, TOWNSHIP 5 NORTH, RANGE 15 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
PARCEL 46: (654-031-02,03)
SECTION 1, TOWNSHIP 6 NORTH, RANGE 15 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPT THEREFROM THE SOUTHEAST ONE-QUARTER OF THE NORTHEAST ONE-QUARTER OF THE NORTHEAST ONE-QUARTER OF SAID SECTION 1.
PARCEL 47: (654-021-27,28)
THE WEST ONE-HALF OF SECTION 13, TOWNSHIP 6 NORTH, RANGE 15 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPT THEREFROM THAT PORTION CONVEYED TO CALIFORNIA, ARIZONA, AND SANTA FE RAILWAY COMPANY BY DEED RECORDED MARCH 16, 1914 IN BOOK 548, OF DEEDS, PAGE 29.
ALSO EXCEPT THEREFROM THAT PORTION CONVEYED TO CALIFORNIA, ARIZONA AND SANTA FE RAILWAY COMPANY BY DEED RECORDED NOVEMBER 26, 1913 IN BOOK 542, OF DEEDS, PAGE 1.
PARCEL 48: (654-011-03,11,21,22)
SECTIONS 21, 29 AND 33, TOWNSHIP 6 NORTH, RANGE 15 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPT FROM SAID SECTION 33 THAT PORTION CONVEYED TO CALIFORNIA, ARIZONA, AND SANTA FE RAILWAY COMPANY BY DEED RECORDED MARCH 16, 1914, IN BOOK 548, OF DEEDS, PAGE 29.
PARCEL 49: (556-321-03)
SECTION 4, TOWNSHIP 4 NORTH, RANGE 14 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
PARCEL 50: (653-041-13)
SECTION 8, TOWNSHIP 5 NORTH, RANGE 15 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPTING THEREFROM ANY PORTION OF THE ABOVE DESCRIBED PARCELS OF LAND LYING WITHIN THE 200 FOOT RIGHT OF WAY GRANTED TO SOUTHERN PACIFIC RAILROAD COMPANY BY ACT OF CONGRESS APPROVED JULY 27, 1866.
EXCEPT ALL MINERAL AND MINERAL RIGHTS AS MORE FULLY SET FORTH IN THE DEED FROM SANTA FE PACIFIC REALTY CORPORATION, A DELAWARE CORPORATION, AS SUCCESSOR IN INTEREST TO SOUTHERN PACIFIC LAND COMPANY, A CALIFORNIA CORPORATION, RECORDED OCTOBER 14, 1988 AS INSTRUMENT NO. 88-346016 OF OFFICIAL RECORDS.
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SAID DEED RECITES THE FOLLOWING:
GRANTOR EXCEPTS FROM SECTION 9, TOWNSHIP 5 NORTH, RANGE 15 EAST, SAN BERNARDINO MERIDIAN, AND RESERVES UNTO ITSELF, ITS SUCCESSORS AND ASSIGNS ALL MINERALS AND MINERAL RIGHTS, INTERESTS, AND ROYALTIES, INCLUDING, WITHOUT LIMITING THE GENERALITY THEREOF, ALL OIL GAS AND OTHER HYDROCARBON SUBSTANCES, AS WELL AS ALL GEOTHERMAL RESOURCES, AND METALLIC OR OTHER SOLID MINERALS, TOGETHER WITH THE EXCLUSIVE AND PERPETUAL RIGHT OF GRANTOR, ITS SUCCESSORS, ASSIGNS AND LESSEES, OF INGRESS AND EGRESS IN, UPON AND OVER SAID LAND TO EXPLORE FOR, EXTRACT, STORE, REFINE, PROCESS, AND REMOVE THE SAME, AND MAKE SUCH USE OF SAID LAND AS IS NECESSARY OR USEFUL IN CONNECTION THEREWITH, TOGETHER WITH THE RIGHT TO USE SUCH WATER AS MAY BE FOUND ON OR BENEATH SAID LAND FOR EXTRACTION OR PROCESSING OF SUCH MINERALS AS MAY BE FOUND THEREON. GRANTOR COVENANTS AND AGREES THAT IT WILL COMPENSATE THE OWNER OF THE SURFACE OF SAID LAND FOR SUCH PORTION THEREOF AS MAY BE TAKEN OR DAMAGED BY EXERCISE OF THE RIGHTS RETAINED BY GRANTOR, SUCH COMPENSATION TO BE AN AMOUNT EQUAL TO THE DIMINUTION OF THE FAIR MARKET VALUE OF SAID SURFACE ESTATE SO TAKEN OR DAMAGED, WHICH IN THE ABSENCE OF AGREEMENT, SHALL BE DETERMINED BY THE SUPERIOR COURT OF THE COUNTY IN WHICH SAID LAND IS LOCATED, IN THE MANNER PRESCRIBED FOR DETERMINATION OF VALUES OF REAL PROPERTY BEING ACQUIRED THROUGH EXERCISE OF THE POWER OF EMINENT DOMAIN.
PARCEL 51: (556-321-04)
SECTION 3, TOWNSHIP 4 NORTH, RANGE 14 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
PARCEL 52: (556-281-13,17,19,20; 556-311-01,02,05,06,10,11,47)
SECTIONS 8, 17, 18, 19, 20, 23, 24, THE NORTHEAST ONE-QUARTER, THE WEST ONE-HALF AND THE NORTH ONE-HALF OF THE SOUTHEAST ONE-QUARTER OF SECTION 26 AND SECTIONS 28 AND 29, TOWNSHIP 5 NORTH, RANGE 14 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPTING FROM SAID SECTION 17 THAT PORTION CONVEYED TO CALIFORNIA, ARIZONA AND SANTA FE RAILWAY COMPANY BY DEED RECORDED AUGUST 16, 1914 IN BOOK 548 OF DEEDS, PAGE 29.
ALSO EXCEPT FROM SAID SECTION 17 THAT PORTION CONVEYED TO CALIFORNIA, ARIZONA AND SANTA FE RAILWAY COMPANY BY DEED RECORDED NOVEMBER 26, 1913 IN BOOK 542, OF DEEDS, PAGE 1.
EXCEPTING THEREFROM ANY PORTION OF THE ABOVE DESCRIBED PARCELS OF LAND LYING WITHIN THE 200 FOOT RIGHT OF WAY GRANTED TO SOUTHERN PACIFIC RAILROAD COMPANY BY ACT OF CONGRESS APPROVED JULY 27, 1866.
PARCEL 53: (653-041-15)
SECTION 18, TOWNSHIP 5 NORTH, RANGE 15 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPTING THEREFROM ANY PORTION OF THE ABOVE DESCRIBED LAND LYING WITHIN THE 200 FOOT RIGHT OF WAY GRANTED TO SOUTHERN PACIFIC RAILROAD COMPANY BY ACT OF CONGRESS APPROVED JULY 27, 1866.
PARCEL 54: (558-181-04)
THE SOUTH 1/2 OF THE SOUTHWEST 1/4 OF THE NORTHEAST 1/4 AND THE SOUTHWEST 1/4 OF THE SOUTHEAST 1/4 OF THE NORTHEAST 1/4 OF SECTION 31, TOWNSHIP 6 NORTH, RANGE 14 EAST, SAN BERNARDINO BASE AND MERIDIAN, ACCORDING TO THE OFFICIAL PLAT OF SAID LAND.
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DIVISION D:
PARCEL 55: (556-311-49)
THE SOUTHEAST QUARTER OF THE SOUTHEAST QUARTER OF SECTION 21, TOWNSHIP 5 NORTH, RANGE 14 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
DIVISION E:
PARCEL 56: (556-341-01,02,03,05 TO 08; 556-351-01 TO 08)
PARCELS 1, 2, 3, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15 AND 16 OF PARCEL MAPS NO. 10131, IN THE UNINCORPORATED AREA OF SAN BERNARDINO COUNTY, AS PER PLAT RECORDED IN BOOK 108, OF PARCEL MAPS, PAGE 55, RECORDS, RECORDS OF SAID COUNTY.
PARCEL 57: (556-311-53)
THE SOUTH HALF OF THE SOUTHWEST QUARTER OF SECTION 21, TOWNSHIP 5 NORTH, RANGE 14 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA ACCORDING TO THE OFFICIAL PLAT THEREOF.
PARCEL 58: (556-321-02,06,10; 556-321-05)
SECTIONS 1, 5 AND 9, TOWNSHIP 4 NORTH, RANGE 14 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF, AND SECTION 2, TOWNSHIP 4 NORTH, RANGE 14 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
DIVISION G:
PARCEL 59: (659-241-02)
SECTION 17, TOWNSHIP 10 NORTH, RANGE 21 EAST, SAN BERNARDINO BASE AND MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPTING THEREFROM THE LAND OF THE ATCHISON, TOPEKA AND SANTA FE RAILWAY COMPANY AS THE SAME WAS DESCRIBED IN THE DEEDS RECORDED MARCH 16, 1914 IN BOOK 348, PAGE 29 OF DEEDS, DECEMBER 28, 1911 IN BOOK 496, PAGE 169 OF DEEDS AND NOVEMBER 26, 1913 IN BOOK 542, PAGE 1 OF DEEDS, RECORDS OF SAID COUNTY.
EXCEPT THE FOLLOWING AS RESERVED IN THE DEED FROM SF PACIFIC PROPERTIES INC. RECORDED JUNE 18, 1999 AS INSTRUMENT NO. 260205 ALL RIGHT, TITLE AND INTEREST IN AND TO ALL MINERALS AND MINERAL RIGHTS, INCLUDING, WITHOUT LIMITATION, OIL, GAS AND OTHER HYDROCARBONS, COAL, GEOTHERMAL RESOURCES, PRECIOUS METAL ORES, BASE METAL ORES, INDUSTRIAL-GRADE SILICATES AND CARBONATES, FISSIONABLE MATERIALS, SAND, GRAVEL, AGGREGATES, AND ALL OTHER MINERALS OF EVERY KIND AND CHARACTER, METALLIC OR OTHERWISE, WHETHER OR NOT PRESENTLY KNOWN TO SCIENCE OR INDUSTRY, NOW KNOWN TO EXIST OR HEREAFTER DISCOVERED UPON, WITHIN OR UNDERLYING THE SURFACE OF SAID LAND REGARDLESS OF THE DEPTH BELOW THE SURFACE AT WHICH ANY SUCH SUBSTANCE MAY BE FOUND; HOWEVER, GRANTOR, ITS SUCCESSORS AND ASSIGNS, SHALL NOT HAVE THE RIGHT FOR ANY PURPOSE WHATSOEVER TO ENTER UPON, INTO OR THROUGH THE SURFACE OR THE FIRST 300 FEET OF THE SUBSURFACE OF THE PROPERTY IN CONNECTION THEREWITH. GRANTOR HEREBY ACKNOWLEDGES AND AGREES THAT THE FOREGOING RESERVATION SHALL NOT BE DEEMED TO LIMIT THE RIGHT OF GRANTEE TO EXTRACT WATER FROM THE PROPERTY WHICH MAY INCLUDE THE INCIDENTAL EXTRACTION OF MINERALS, SAND, GRAVEL OR OTHER MATERIALS IN CONNECTION WITH THE EXTRACTION OF WATER.
PARCEL 60: (659-181-03)
SECTION 5 IN TOWNSHIP 10 NORTH, RANGE 21 EAST, SAN BERNARDINO BASE AND MERIDIAN, ACCORDING TO THE OFFICIAL PLAT THEREOF.
A-16
EXCEPT THE FOLLOWING AS RESERVED IN THE DEED FROM SF PACIFIC PROPERTIES INC. RECORDED JUNE 18, 1999 AS INSTRUMENT NO. 260205 ALL RIGHT, TITLE AND INTEREST IN AND TO ALL MINERALS AND MINERAL RIGHTS, INCLUDING, WITHOUT LIMITATION, OIL, GAS AND OTHER HYDROCARBONS, COAL, GEOTHERMAL RESOURCES, PRECIOUS METAL ORES, BASE METAL ORES, INDUSTRIAL-GRADE SILICATES AND CARBONATES, FISSIONABLE MATERIALS, SAND, GRAVEL, AGGREGATES, AND ALL OTHER MINERALS OF EVERY KIND AND CHARACTER, METALLIC OR OTHERWISE, WHETHER OR NOT PRESENTLY KNOWN TO SCIENCE OR INDUSTRY, NOW KNOWN TO EXIST OR HEREAFTER DISCOVERED UPON, WITHIN OR UNDERLYING THE SURFACE OF SAID LAND REGARDLESS OF THE DEPTH BELOW THE SURFACE AT WHICH ANY SUCH SUBSTANCE MAY BE FOUND; HOWEVER, GRANTOR, ITS SUCCESSORS AND ASSIGNS, SHALL NOT HAVE THE RIGHT FOR ANY PURPOSE WHATSOEVER TO ENTER UPON, INTO OR THROUGH THE SURFACE OR THE FIRST 300 FEET OF THE SUBSURFACE OF THE PROPERTY IN CONNECTION THEREWITH. GRANTOR HEREBY ACKNOWLEDGES AND AGREES THAT THE FOREGOING RESERVATION SHALL NOT BE DEEMED TO LIMIT THE RIGHT OF GRANTEE TO EXTRACT WATER FROM THE PROPERTY WHICH MAY INCLUDE THE INCIDENTAL EXTRACTION OF MINERALS, SAND, GRAVEL OR OTHER MATERIALS IN CONNECTION WITH THE EXTRACTION OF WATER.
PARCEL 61: (659-181-06)
SECTION 9 IN TOWNSHIP 10 NORTH, RANGE 21 EAST, SAN BERNARDINO BASE AND MERIDIAN, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPT THE FOLLOWING AS RESERVED IN THE DEED FROM SF PACIFIC PROPERTIES INC. RECORDED JUNE 18, 1999 AS INSTRUMENT NO. 260205 ALL RIGHT, TITLE AND INTEREST IN AND TO ALL MINERALS AND MINERAL RIGHTS, INCLUDING, WITHOUT LIMITATION, OIL, GAS AND OTHER HYDROCARBONS, COAL, GEOTHERMAL RESOURCES, PRECIOUS METAL ORES, BASE METAL ORES, INDUSTRIAL-GRADE SILICATES AND CARBONATES, FISSIONABLE MATERIALS, SAND, GRAVEL, AGGREGATES, AND ALL OTHER MINERALS OF EVERY KIND AND CHARACTER, METALLIC OR OTHERWISE, WHETHER OR NOT PRESENTLY KNOWN TO SCIENCE OR INDUSTRY, NOW KNOWN TO EXIST OR HEREAFTER DISCOVERED UPON, WITHIN OR UNDERLYING THE SURFACE OF SAID LAND REGARDLESS OF THE DEPTH BELOW THE SURFACE AT WHICH ANY SUCH SUBSTANCE MAY BE FOUND; HOWEVER, GRANTOR, ITS SUCCESSORS AND ASSIGNS, SHALL NOT HAVE THE RIGHT FOR ANY PURPOSE WHATSOEVER TO ENTER UPON, INTO OR THROUGH THE SURFACE OR THE FIRST 300 FEET OF THE SUBSURFACE OF THE PROPERTY IN CONNECTION THEREWITH. GRANTOR HEREBY ACKNOWLEDGES AND AGREES THAT THE FOREGOING RESERVATION SHALL NOT BE DEEMED TO LIMIT THE RIGHT OF GRANTEE TO EXTRACT WATER FROM THE PROPERTY WHICH MAY INCLUDE THE INCIDENTAL EXTRACTION OF MINERALS, SAND, GRAVEL OR OTHER MATERIALS IN CONNECTION WITH THE EXTRACTION OF WATER.
PARCEL 62: (659-241-16,17)
SECTION 21 IN TOWNSHIP 10 NORTH, RANGE 21 EAST, SAN BERNARDINO BASE AND MERIDIAN, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPT THEREFROM THOSE PORTIONS OF SECTION 21 DESCRIBED AS PARCEL NOS. 5 AND 6 IN THE DEED TO THE CALIFORNIA, ARIZONA AND SANTA FE RAILWAY COMPANY, A CORPORATION, RECORDED NOVEMBER 26, 1913 IN BOOK 542, PAGE 1 OF DEEDS IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.
ALSO EXCEPT THEREFROM THOSE PORTIONS INCLUDED WITHIN THE LINES OF THAT CERTAIN RAILROAD RIGHT OF WAY, 200 FEET IN WIDTH, AND THE ‘STATION GROUNDS AT IBIS, ORIGINALLY IBEX,” AS DESCRIBED IN THE DEED TO THE CALIFORNIA, ARIZONA AND SANTA FE RAILWAY COMPANY, A CALIFORNIA CORPORATION, RECORDED MARCH 15, 1914 IN BOOK 548, PAGE 29 OF SAID DEEDS.
ALSO EXCEPT THEREFROM THAT PORTION DESCRIBED IN THE DEED TO THE CALIFORNIA, ARIZONA AND SANTA FE RAILWAY COMPANY, A CORPORATION, RECORDED JULY 1, 1952 IN BOOK 2977, PAGE 469 OF OFFICIAL RECORDS IN SAID OFFICE OF THE COUNTY RECORDER.
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EXCEPT THE FOLLOWING AS RESERVED IN THE DEED FROM SF PACIFIC PROPERTIES INC. RECORDED JUNE 18, 1999 AS INSTRUMENT NO. 260205. ALL RIGHT, TITLE AND INTEREST IN AND TO ALL MINERALS AND MINERAL RIGHTS, INCLUDING, WITHOUT LIMITATION, OIL, GAS AND OTHER HYDROCARBONS, COAL, GEOTHERMAL RESOURCES, PRECIOUS METAL ORES, BASE METAL ORES, INDUSTRIAL-GRADE SILICATES AND CARBONATES, FISSIONABLE MATERIALS, SAND, GRAVEL, AGGREGATES, AND ALL OTHER MINERALS OF EVERY KIND AND CHARACTER, METALLIC OR OTHERWISE, WHETHER OR NOT PRESENTLY KNOWN TO SCIENCE OR INDUSTRY, NOW KNOWN TO EXIST OR HEREAFTER DISCOVERED UPON, WITHIN OR UNDERLYING THE SURFACE OF SAID LAND REGARDLESS OF THE DEPTH BELOW THE SURFACE AT WHICH ANY SUCH SUBSTANCE MAY BE FOUND; HOWEVER, GRANTOR, ITS SUCCESSORS AND ASSIGNS, SHALL NOT HAVE THE RIGHT FOR ANY PURPOSE WHATSOEVER TO ENTER UPON, INTO OR THROUGH THE SURFACE OR THE FIRST 300 FEET OF THE SUBSURFACE OF THE PROPERTY IN CONNECTION THEREWITH, GRANTOR HEREBY ACKNOWLEDGES AND AGREES THAT THE FOREGOING RESERVATION SHALL NOT BE DEEMED TO LIMIT THE RIGHT OF GRANTEE TO EXTRACT WATER FROM THE PROPERTY WHICH MAY INCLUDE THE INCIDENTAL EXTRACTION OF MINERALS, SAND, GRAVEL OR OTHER MATERIALS IN CONNECTION WITH THE EXTRACTION OF WATER.
PARCEL 63: (659-171-10)
SECTION 29 IN TOWNSHIP 10 NORTH, RANGE 21 EAST, SAN BERNARDINO BASE AND MERIDIAN, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPT THE FOLLOWING AS RESERVED IN THE DEED FROM SF PACIFIC PROPERTIES INC. RECORDED JUNE 18, 1999 AS INSTRUMENT NO. 260205 ALL RIGHT, TITLE AND INTEREST IN AND TO ALL MINERALS AND MINERAL RIGHTS, INCLUDING, WITHOUT LIMITATION, OIL, GAS AND OTHER HYDROCARBONS, COAL, GEOTHERMAL RESOURCES, PRECIOUS METAL ORES, BASE METAL ORES, INDUSTRIAL-GRADE SILICATES AND CARBONATES, FISSIONABLE MATERIALS, SAND, GRAVEL, AGGREGATES, AND ALL OTHER MINERALS OF EVERY KIND AND CHARACTER, METALLIC OR OTHERWISE, WHETHER OR NOT PRESENTLY KNOWN TO SCIENCE OR INDUSTRY, NOW KNOWN TO EXIST OR HEREAFTER DISCOVERED UPON, WITHIN OR UNDERLYING THE SURFACE OF SAID LAND REGARDLESS OF THE DEPTH BELOW THE SURFACE AT WHICH ANY SUCH SUBSTANCE MAY BE FOUND; HOWEVER, GRANTOR, ITS SUCCESSORS AND ASSIGNS, SHALL NOT HAVE THE RIGHT FOR ANY PURPOSE WHATSOEVER TO ENTER UPON, INTO OR THROUGH THE SURFACE OR THE FIRST 300 FEET OF THE SUBSURFACE OF THE PROPERTY IN CONNECTION THEREWITH. GRANTOR HEREBY ACKNOWLEDGES AND AGREES THAT THE FOREGOING RESERVATION SHALL NOT BE DEEMED TO LIMIT THE RIGHT OF GRANTEE TO EXTRACT WATER FROM THE PROPERTY WHICH MAY INCLUDE THE INCIDENTAL EXTRACTION OF MINERALS, SAND, GRAVEL OR OTHER MATERIALS IN CONNECTION WITH THE EXTRACTION OF WATER.
DIVISION F:
PARCEL 1: (0556-271-02-0-000)
ALL OF SECTION 5, TOWNSHIP 5 NORTH, RANGE 13 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
PARCEL 2: (0556-271-10-0-000)
SECTION 9, TOWNSHIP 5 NORTH, RANGE 13 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPTING THEREFROM THAT PORTION OF THE SOUTH ONE-HALF OF THE SOUTHEAST ONE-QUARTER OF SECTION 9, TOWNSHIP 5 NORTH, RANGE 13 EAST, DESCRIBED AS FOLLOWS:
BEGINNING AT A POINT IN THE SOUTH LINE OF SAID SECTION 9, 167 FEET WEST FROM THE SOUTHEAST CORNER OF SAID SECTION 9; THENCE NORTH 52º 34’ WEST 1650 FEET; THENCE SOUTH 25º 51’ WEST 1114.4 FEET TO A POINT IN THE SAID SOUTH LINE OF SECTION 9; THENCE EAST, ALONG SAID SOUTH LINE 1795.1 FEET TO THE POINT OF BEGINNING.
ALSO EXCEPTING THEREFROM THAT PORTION OF THE SOUTHWEST ONE-QUARTER OF THE SOUTHEAST ONE-QUARTER AND OF THE SOUTHEAST ONE-QUARTER OF THE SOUTHWEST ONE-QUARTER OF SECTION 9, TOWNSHIP 5 NORTH, RANGE 13 EAST, DESCRIBED AS FOLLOWS:
BEGINNING AT A POINT IN THE NORTHERN RIGHT OF WAY LINE OF SAID RAILWAY COMPANY, 100 FEET NORTHERLY FROM AND AT RIGHT ANGLES TO THE CENTER LINE OF SAID RAILWAY COMPANY’S TRAIN TRACK, AT ENGINEER’S STATION 4495 PLUS 25.7; THENCE NORTH 28º 55’ EAST, 1132.4 FEET; THENCE SOUTH 47º 34’ EAST, 1720 FEET, MORE OR LESS, TO THE SOUTH LINE OF SAID SECTION 9; THENCE WESTERLY, ALONG SAID SOUTH LINE OF SAID NORTHERN RIGHT OF WAY LINE, TO THE POINT OF BEGINNING.
ALSO EXCEPTING THEREFROM THAT PORTION OF THE SOUTH ONE-HALF OF THE SOUTHWEST ONE-QUARTER AND THE NORTHWEST ONE-QUARTER OF THE SOUTHWEST ONE-QUARTER OF SECTION 9, TOWNSHIP 5 NORTH, RANGE 13 EAST, DESCRIBED AS FOLLOWS:
A-18
BEGINNING AT A POINT IN THE NORTHERN RIGHT OF WAY LINE OF SAID RAILWAY COMPANY, 100 FEET NORTHERLY FROM AND AT RIGHT ANGLES TO THE CENTER LINE OF SAID RAILWAY COMPANY’S MAIN TRACK AT ENGINEER’S STATION 4465 PLUS 25.7; THENCE NORTH 38º 39’ WEST, 2360 FEET, MORE OR LESS, TO A POINT IN THE WEST LINE OF SAID SECTION 9; THENCE SOUTH, ALONG SAID WEST LINE, TO AN INTERSECTION WITH THE NORTHERN BOUNDARY OF SAID RAILWAY COMPANY’S STATION GROUNDS AT OLD BENGAL; THENCE SOUTH 84º 39’ EAST, 759.4 FEET, MORE OR LESS, ALONG SAID NORTHERN BOUNDARY TO THE NORTHEAST CORNER OF SAID STATION GROUNDS, 200 FEET, NORTHERLY AT RIGHT ANGLES FROM THE CENTER LINE OF SAID RAILWAY COMPANY’S MAIN TRACK AT ENGINEER’S STATION 4492 PLUS 50; THENCE SOUTH 5º 21’ WEST, 100 FEET, ALONG THE EASTERLY BOUNDARY OF SAID STATION GROUNDS, TO SAID NORTHERN RIGHT OF WAY LINE; THENCE SOUTH 84º 39’ EAST ALONG SAID RIGHT OF WAY LINE, 724.3 FEET TO THE POINT OF BEGINNING.
ALSO EXCEPTING THEREFROM THAT PORTION LYING WITHIN THE FOLLOWING DESCRIBED PROPERTY:
THE STATION GROUNDS AT OLD BENGAL, ORIGINALLY BRISTOL; SITUATED IN THE SOUTH ONE-HALF OF THE SOUTHEAST ONE-QUARTER OF SECTION 8, IN THE SOUTHWEST ONE-QUARTER OF THE SOUTHWEST ONE-QUARTER OF SECTION 9 AND IN THE NORTHWEST ONE-QUARTER OF THE NORTHWEST ONE-QUARTER OF SECTION 16, TOWNSHIP 5 NORTH, RANGE 13 EAST, BEING 2 STRIPS OF LAND, EACH 100 FEET IN WIDTH BY 2600 FEET IN LENGTH, CONTIGUOUS TO AND ON THE NORTHERLY AND SOUTHERLY SIDES OF THE 200 FOOT RIGHT OF WAY AND EXTENDING FROM A LINE AT RIGHT ANGLES TO THE MAIN TRACK THROUGH ENGINEER’S STATION 4518 PLUS 50 SOUTH 54º 39’ EAST 2600 FEET TO A LINE AT RIGHT ANGLES TO THE MAIN TRACK THROUGH ENGINEER’S STATION 4492 PLUS 50.
ALSO EXCEPTING THEREFROM THAT PORTION LYING WITHIN THE 200 FOOT WIDE STRIP OF LAND DESCRIBED IN THE DEED TO THE CALIFORNIA, ARIZONA AND SANTA FE RAILWAY COMPANY DATED MAY 29, 1913 RECORDED APRIL 16, 1914 IN BOOK 548 PAGE 29 OF DEEDS.
PARCEL 3: (0556-271-16-0-000)
THAT PORTION OF THE SOUTH ONE-HALF OF THE SOUTHEAST ONE-QUARTER OF SECTION 9, TOWNSHIP 5 NORTH, RANGE 13 EAST, DESCRIBED AS FOLLOWS:
BEGINNING AT A POINT IN THE SOUTH LINE OF SAID SECTION 9, 167 FEET WEST FROM THE SOUTHEAST CORNER OF SAID SECTION 9; THENCE NORTH 52º 34’ WEST 1650 FEET; THENCE SOUTH 25º 51’ WEST 1114.4 FEET TO A POINT IN THE SAID SOUTH LINE OF SECTION 9; THENCE EAST, ALONG SAID SOUTH LINE 1795.1 FEET TO THE POINT OF BEGINNING.
PARCEL 4: (0556-271-15-0-000)
THAT PORTION OF THE SOUTHWEST ONE-QUARTER OF THE SOUTHEAST ONE-QUARTER AND OF THE SOUTHEAST ONE-QUARTER OF THE SOUTHWEST ONE-QUARTER OF SECTION 9, TOWNSHIP 5 NORTH, RANGE 13 EAST, DESCRIBED AS FOLLOWS:
BEGINNING AT A POINT IN THE NORTHERN RIGHT OF WAY LINE OF SAID RAILWAY COMPANY, 100 FEET NORTHERLY FROM AND AT RIGHT ANGLES TO THE CENTER LINE OF SAID RAILWAY COMPANY’S TRAIN TRACK, AT ENGINEER’S STATION 4495 PLUS 25.7; THENCE NORTH 28º 55’ EAST, 1132.4 FEET; THENCE SOUTH 47º 34’ EAST, 1720 FEET, MORE OR LESS, TO THE SOUTH LINE OF SAID SECTION 9; THENCE WESTERLY, ALONG SAID SOUTH LINE OF SAID NORTHERN RIGHT OF WAY LINE, TO THE POINT OF BEGINNING.
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PARCEL 5: (0556-271-14-0-000)
THAT PORTION OF THE SOUTH ONE-HALF OF THE SOUTHWEST ONE-QUARTER AND THE NORTHWEST ONE-QUARTER OF THE SOUTHWEST ONE-QUARTER OF SECTION 9, TOWNSHIP 5 NORTH, RANGE 13 EAST, DESCRIBED AS FOLLOWS:
BEGINNING AT A POINT IN THE NORTHERN RIGHT OF WAY LINE OF SAID RAILWAY COMPANY, 100 FEET NORTHERLY FROM AND AT RIGHT ANGLES TO THE CENTER LINE OF SAID RAILWAY COMPANY’S MAIN TRACK AT ENGINEER’S STATION 4465 PLUS 25.7; THENCE NORTH 38º 39’ WEST, 2360 FEET, MORE OR LESS, TO A POINT IN THE WEST LINE OF SAID SECTION 9; THENCE SOUTH, ALONG SAID WEST LINE, TO AN INTERSECTION WITH THE NORTHERN BOUNDARY OF SAID RAILWAY COMPANY’S STATION GROUNDS AT OLD BENGAL; THENCE SOUTH 84º 39’ EAST, 759.4 FEET, MORE OR LESS, ALONG SAID NORTHERN BOUNDARY TO THE NORTHEAST CORNER OF SAID STATION GROUNDS, 200 FEET, NORTHERLY AT RIGHT ANGLES FROM THE CENTER LINE OF SAID RAILWAY COMPANY’S MAIN TRACK AT ENGINEER’S STATION 4492 PLUS 50; THENCE SOUTH 5º 21’ WEST, 100 FEET, ALONG THE EASTERLY BOUNDARY OF SAID STATION GROUNDS, TO SAID NORTHERN RIGHT OF WAY LINE; THENCE SOUTH 84º 39’ EAST ALONG SAID RIGHT OF WAY LINE, 724.3 FEET TO THE POINT OF BEGINNING.
PARCEL 6: (0556-271-23-0-000)
ALL OF SECTION 17, TOWNSHIP 5 NORTH, RANGE 13 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
PARCEL 7: (0556-251-03-0-000)
ALL OF SECTION 21, TOWNSHIP 5 NORTH, RANGE 13 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
PARCEL 8: (0556-251-11-0-000)
SECTION 29, TOWNSHIP 5 NORTH, RANGE 13 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
PARCEL 9: (0556-251-15-0-000)
SECTION 33, TOWNSHIP 5 NORTH, RANGE 13 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
PARCEL 10: (0556-251-10-0-000)
SECTION 29, TOWNSHIP 13 NORTH, RANGE 19 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
PARCEL 11: (0653-011-15-0-000)
SECTION 33, TOWNSHIP 4 NORTH, RANGE 15 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
PARCEL 12: (0558-151-14-0-000)
THAT PORTION OF SECTION 33, TOWNSHIP 6 NORTH, RANGE 13 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF ON FILE IN THE DISTRICT LAND OFFICE, LYING NORTHERLY OF THE STATE HIGHWAY.
PARCEL 13: (0558-151-15-0-000)
THAT PORTION OF SECTION 33, TOWNSHIP 6 NORTH, RANGE 13 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF ON FILE IN THE DISTRICT LAND OFFICE, LYING SOUTHERLY OF THE STATE HIGHWAY.
A-20
PARCEL 14: (0556-271-22-0-000)
SECTION 16, TOWNSHIP 5 NORTH, RANGE 15 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPTING THEREFROM THOSE CERTAIN STRIPS OF LAND FOR RAILWAY PURPOSES AND STATION GROUNDS DEEDED TO CALIFORNIA, ARIZONA AND SANTA FE RAILROAD COMPANY BY DEEDS RECORDED NOVEMBER 26, 1913 IN BOOK 542 OF DEEDS, PAGE 1, AND MARCH 16, 1914 IN BOOK 548 OF DEEDS, PAGE 29.
ALSO EXCEPTING THEREFROM ALL COAL, OIL, GAS AND OTHER MINERAL DEPOSITS, TOGETHER WITH THE RIGHTS TO PROSPECT FOR, MINE AND REMOVE THE SAME, ACCORDING TO THE PROVISIONS OF SAID ACT OF JUNE 1, 1938 AS RESERVED IN THE PATENT FROM THE STATE OF CALIFORNIA, RECORDED JULY 28, 1958, IN BOOK 4564 PAGE 100 OF OFFICIAL RECORDS.
PARCEL 15: (0656-111-18-0-000)
SECTION 13, TOWNSHIP 9 NORTH, RANGE 17 EAST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
PARCEL 16: (0556-311-04-0-000)
ALL OF SECTION 22, TOWNSHIP 5 NORTH, RANGE 14 EAST, SAN BERNARDINO BASE AND MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
PARCEL 17: (0556-311-09-0-000)
ALL OF SECTION 27, TOWNSHIP 5 NORTH, RANGE 14 EAST, SAN BERNARDINO BASE AND MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
PARCEL 18:
INTENTIONALLY OMITTED
PARCEL 19:
INTENTIONALLY OMITTED
PARCEL 20: (0556-341-02-0-000)
PARCEL 2 OF PARCEL MAP 10131, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, AS PER PLAT RECORDED IN BOOK 108, OF PARCEL MAPS, PAGE 55, RECORDS OF SAID COUNTY.
PARCEL 21: (0558-171-16-0-000)
THE EAST 1/2 OF THE SOUTH 1/2 OF THE SOUTHEAST 1/4 OF SECTION 36, TOWNSHIP 6 NORTH, RANGE 13 EAST, SAN BERNARDINO BASE AND MERIDIAN, ACCORDING TO GOVERNMENT SURVEY, RECORDS OF SAID COUNTY.
PARCEL 22: (0558-181-21-0-000)
THAT PORTION OF THE SOUTHEAST 1/4 OF SECTION 31, TOWNSHIP 6 NORTH, RANGE 14 EAST, SAN BERNARDINO BASE AND MERIDIAN, LYING SOUTH OF THE SOUTH LINE OF ROUTE 66, OF SAID COUNTY, AND MORE PARTICULARLY DESCRIBED AS FOLLOWS:
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BEGINNING AT THE SOUTHEAST CORNER OF AFOREMENTIONED SECTION 31; THENCE NORTH 1º 09’ 15” WEST, ALONG THE EAST LINE OF SAID SECTION, 1118.69 FEET TO THE SOUTH LINE OF ROUTE 66 AS DESCRIBED IN THAT CERTAIN QUITCLAIM DEED FROM MELVANE CHAMBLESS TO THE STATE OF CALIFORNIA, RECORDED IN BOOK 594 PAGE 279, OFFICIAL RECORDS; THENCE ALONG SAID SOUTH LINE SOUTH 88º 42’ 45” WEST 2,648.78 FEET TO A POINT ON THE WEST LINE OF SAID SOUTHEAST 1/4 OF SECTION 31; THENCE SOUTH 1º 14’ 08” EAST 1,043.56 FEET ALONG SAID WEST LINE TO THE SOUTH 1/4 CORNER OF SAID SECTION 31; THENCE ALONG THE SOUTH LINE OF SAID SOUTHEAST 1/4 SOUTH 89º 39’ 43” EAST, 2,648.12 FEET TO THE POINT OF BEGINNING.
PARCEL 23: (0558-181-21-0-000)
THAT PORTION OF THE SOUTHEAST 1/4 OF SECTION 31, TOWNSHIP 6 NORTH, RANGE 14 EAST, SAN BERNARDINO BASE AND MERIDIAN, LYING NORTH OF THE NORTH LINE OF ROUTE 66 WHICH HIGHWAY IS 200 FEET WIDE AND MORE PARTICULARLY DESCRIBED IN THAT CERTAIN QUITCLAIM DEED FROM MELVANE CHAMBLESS TO THE STATE OF CALIFORNIA, RECORDED IN BOOK 594 PAGE 279, OFFICIAL RECORDS.
PARCEL 24: (0558-181-05-0-000)
THE SOUTHEAST QUARTER OF THE SOUTHEAST QUARTER OF THE NORTHEAST QUARTER OF SECTION 31, TOWNSHIP 6 NORTH, RANGE 14 EAST, OF THE SAN BERNARDINO BASE AND MERIDIAN, CONTAINING 10 ACRES MORE OR LESS.
PARCEL 25: (0645-061-15-0-000)
ALL OF SECTION 16, TOWNSHIP 3 NORTH, RANGE 18 EAST, SAN BERNARDINO BASE AND MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPTING THEREFROM ALL MINERALS AND MINERAL DEPOSITS, INCLUDING, BUT NOT LIMITED TO, OIL AND GAS, OTHER GASES, INCLUDING, BUT NOT LIMITED TO, NONHYDROCARBON AND GEOTHERMAL GASES, OIL SHALE, COAL, PHOSPHATE, ALUMINA, SILICA, FOSSILS OF ALL GEOLOGICAL AGES, SODIUM, GOLD, SILVER, METALS AND THEIR COMPOUNDS, ALKALI, ALKALI EARTH, SAND, CLAY, GRAVEL, SALTS AND MINERAL WATERS, URANIUM, TRONA, AND GEOTHERMAL RESOURCES, TOGETHER WITH THE RIGHT OF THE STATE OR PERSONS AUTHORIZED BY THE STATE TO PROSPECT FOR, DRILL FOR, EXTRACT, MINE AND REMOVE SUCH DEPOSITS OR RESOURCES, AND TO OCCUPY AND USE SO MUCH OF THE SURFACE OF THE LANDS AS MAY BE NECESSARY THEREFROM, AS RESERVED BY THE STATE OF CALIFORNIA IN PATENT RECORDED JUNE 4, 1996 AS INSTRUMENT NO. 19960197383 OF OFFICIAL RECORDS.
A-22
PARCEL 26: (0659-241-03-0-000)
ALL OF SECTION 16, TOWNSHIP 10 NORTH, RANGE 21 EAST, SAN BERNARDINO BASE AND MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF.
EXCEPTING THEREFROM ALL MINERALS AND MINERAL DEPOSITS, INCLUDING, BUT NOT LIMITED TO, OIL AND GAS, OTHER GASES, INCLUDING, BUT NOT LIMITED TO, NONHYDROCARBON AND GEOTHERMAL GASES, OIL SHALE, COAL, PHOSPHATE, ALUMINA, SILICA, FOSSILS OF ALL GEOLOGICAL AGES, SODIUM, GOLD, SILVER, METALS AND THEIR COMPOUNDS, ALKALI, ALKALI EARTH, SAND, CLAY, GRAVEL, SALTS AND MINERAL WATERS, URANIUM, TRONA, AND GEOTHERMAL RESOURCES, TOGETHER WITH THE RIGHT OF THE STATE OR PERSONS AUTHORIZED BY THE STATE TO PROSPECT FOR, DRILL FOR, EXTRACT, MINE AND REMOVE SUCH DEPOSITS OR RESOURCES, AND TO OCCUPY AND USE SO MUCH OF THE SURFACE OF THE LANDS AS MAY BE NECESSARY THEREFROM, AS RESERVED BY THE STATE OF CALIFORNIA IN PATENT RECORDED JUNE 4, 1996 AS INSTRUMENT NO. 19960197382 OF OFFICIAL RECORDS.
PARCEL NO. 27: (0556-271-27, 0556-271-29, 0556-271-30 & 0556-271-31)
THE SOUTHERLY 25 FEET OF THAT CERTAIN SOUTHERLY 100 FOOT WIDE BY 2600 FOOT LENGTH STRIP OF LAND LYING IN THE SOUTHWEST QUARTER OF SECTION 9, AND IN THE SOUTHEAST QUARTER OF SECTION 8, AND IN THE NORTHWEST QUARTER OF SECTION 16, AND IN THE NORTHEAST QUARTER OF SECTION 17, ALL IN TOWNSHIP 5 NORTH, RANGE 13 EAST, OF THE SAN BERNARDINO MERIDIAN, DESCRIBED AS "STATION GROUNDS AT OLD BENGAL" IN THAT CERTAIN INDENTURE DATED MAY 29, 1913, CONVEYING LANDS TO THE CALIFORNIA, ARIZONA AND SANTA FE RAILWAY COMPANY (PREDECESSOR IN INTEREST TO THE ATCHISON, TOPEKA AND SANTA FE RAILWAY COMPANY, BY DEED RECORDED IN BOOK 548 AT PAGE 29, DEED RECORDS OF SAN BERNARDINO COUNTY, CALIFORNIA.
A-23
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