HomeMy WebLinkAbout1995-06-27; Industrial Development Authority; 002 Exhibit 7; Security AgreementSECURITY AGREEMENT
Loan No.
THIS SECURITY AGREEMENT (this avAgreementmm) is made as
of the first day of July, 1995, between CIP LIMITED, L.P., a
California Limited Partnership, (nmDebtorg@), and FIRST INTERSTATE
BANK OF CALIFORNIA, a California corporation, (Wecured Party") , acting as Trustee under that certain Indenture (1mIndenture88),
dated July 1, 1995, between First Interstate Bank of California and Industrial Development Authority of the City of Carlsbad, California, (8mIssuernn) .
FOR GOOD AND VALUABLE CONSIDERATION, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
1 . Definitions. All terms used herein which are
defined in that certain Loan Agreement, dated July 1, 1995, (the "Loan Agreementun) between Debtor, as borrower, and Issuer, shall
have the same meaning herein unlessthe context requires otherwise.
Pursuant to the Indenture, the rights of the Issuer under the Loan
Agreement were assigned to the Secured Party.
2. Creation of Security Interest. Debtor hereby grants to Secured Party a security interest in and to all personal property in which Debtor now or hereafter owns or acquires any interest or right, including, without limitation leased personal property and the personal property described in Exhibit B hereto
and by this reference incorporated herein and which are now or
hereafter located on or used or useful in the construction,
operation, use or occupancy of the Project (as defined in the Loan Agreement) or the real property described in Exhibit 9 hereto and by this reference incorporated herein (the 8uPropertysm), and all insurance proceeds from any policy of insurance covering any of the aforesaid property now or hereafter acquired by Debtor (such personal property and insurance proceeds are hereinafter
collectively called collateral^^) , for the purposes of securing: (a) payment of all amounts due under the Loan Agreement, and all modifications, extensions, renewals and replacements
thereof; (b) payment of all sums advanced by Secured Party to protect the Collateral, with interest thereon at the Default Rate (as defined in the Loan Agreement) ; (c) payment of all indebtedness
of Debtor, or its successors or assigns, to Secured Party evidenced
by a promissory note or notes or other instruments or agreements
reciting that they are secured hereby; and (d) performance of every obligation, covenant and agreement of Debtor contained herein and in the Loan Agreement and in any other loan agreement, promissory
note or other agreement now or hereafter executed by Debtor which
recites that performance of the obligations thereunder is secured hereby.
Warranties, Representations 8nd Covenant8 of Debtor.
To induce Secured Party to accept this Security Agreement, Debtor
hereby represents, warrants and covenants as follows:
3.
(a) Except for the security interest granted hereby and
the liens of other security agreements expressly subordinated and subject to the lien of this Agreement, Debtor is, and as to portions of the Collateral to be acquired after the date hereof will be, the sole owner of the Collateral, free from any adverse lien, security interest, or adverse claim of any
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kind whatsoever. Debtor will notify Secured Party of and will
defend the Collateral against all claims and demands of all persons at any time claiming the same or any interest therein.
(b) The Collateral is not used or bought for personal, family or household purposes.
(c) Except as otherwise provided in the Loan Agreement, the tangible Collateral will be kept on or at the Property and Debtor will not, without the prior written consent of Secured
Party, remove the Collateral therefrom except such portions or
items of Collateral which are consumed or worn out in ordinary usage, all of which shall be promptly replaced by Debtor with property of similar nature and of equal or greater value.
(d) At the request of Secured Party, Debtor will execute
one or more financing statements and fixture filings pursuant to the Uniform Commercial Code of California, in form
satisfactory to Secured Party, and will pay the cost of filing the same in all public offices wherever filing is deemed by
Secured Party to be necessary or desirable.
(e) Debtor's principal place of business is at the address set forth in the Loan Agreement. Debtor does not do business under any trade name or fictitious business name
other than CIP, LIMITED, L.P., a California Limited
Partnership. Debtor will immediately notify Secured Party in writing of any change in its place of business or the adoption or change of any trade name or fictitious business name, and will upon request of Secured Party, execute any additional
financing statements or other certificates necessary to
reflect the adoption or change in trade names or fictitious
business name.
(f) Debtor will not, without the prior written consent of Secured Party, sell, offer to sell or otherwise transfer, exchange or dispose of the Collateral or any interest therein, unless in the normal course of business the Collateral is
being replaced by collateral of similar nature and of equal or
greater value. If the Collateral or any part thereof is sold, transferred, exchanged, or otherwise disposed of (either with or without the written consent of Secured Party), the security interest of Secured Party shall extend to the proceeds of such sale, transfer, exchange or other disposition and Debtor will hold said proceeds in a separate account for Secured Party's
benefit and will, at Secured Party's request, transfer such proceeds to Secured Party in kind.
(g) Debtor will keep the Collateral in good condition and repair, and will not misuse, abuse, allow to deteriorate, waste or destroy the Collateral or any part thereof, except for ordinary wear and tear resulting from its normal and expected use in Debtor's business. Secured Party may examine and inspect the Collateral at any reasonable time, wherever
located.
(h) Debtor, in a timely manner, will execute any document, alone or with Secured Party, procure any document, give any notices, do all other acts, and pay all costs associatedwiththe foregoing that Secured Party determines is reasonably necessary to protect the Collateral against rights, claims or interests of third parties, or will otherwise preserve the Collateral as security hereunder.
(i) Debtor shall immediately notify Secured Party of any claim against the Collateral adverse to the interest of Secured Party therein.
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40 Preservation of Collateral by Seaured Party. Should Debtor fail or refuse to make any payment, perform or observe any other covenant, condition, or obligation, or take any other action which Debtor is obligated hereunder to make, perform, observe, take
or do at the time or in the manner herein provided, then Secured
Party may, at Secured Party's sole discretion, without notice to or
demand upon Debtor and without releasing Debtor from any
obligation, covenant, or condition hereof, make, perform, observe,
take or do the same in such manner and to such extent as Secured
Party may deem necessary to protect the security interest in or the value of the Collateral. Furthermore, Secured Party, in its sole discretion, may commence, appear or otherwise participate in any action or proceeding purporting to affect Secured Party's security interest in or the value or ownership of the Collateral. Debtor agrees to pay Secured Party, on demand, the amount of any payment
made or expense incurred by Secured Party pursuant to the foregoing authorizations (including attorneys' fees), together with interest
thereon at the Default Rate from the date of each such payment by Secured Party.
50 Use of Collateral by Debtor. Until the occurrence
of an Event of Default, Debtor may have possession of the Collateral and use it in any lawful manner not inconsistent with
this Agreement and not inconsistent with any policy of insurance
thereon.
60 Default. The occurrence of any of the following shall be deemed an event of default hereunder (DDFvent of Default") :
(a) Debtor fails, breaches or defaults in the payment or
performance of any of the obligations, representations,
covenants or conditions in this Agreement which are not cured
within any applicable notice and cure period set forth in the
applicable provision of the Loan Agreement; or
(b) An Event of Default (as defined therein) shall occur
under any other Loan Document.
7. Remedie8 Upon Default.
(a) Upon the occurrence of an Event of Default
hereunder, Secured Party may, at its option, do any one or
more of the following:
(i) Declare all indebtedness secured hereby to
be immediately due and payable, whereupon all unpaid
principal of and interest on said indebtedness and other
amounts declared due and payable shall be and become
immediately due and payable without presentment, demand,
protest or notice of any kind;
(ii) Either personally, or by means of a court appointed receiver, take possession of all or any part of
the Collateral and exclude therefrom Debtor and all
others claiming under Debtor, and thereafter hold, store,
use, operate, manage, maintain and control, make repairs, replacements, alterations, additions and improvements to and exercise all rights and powers of Debtor with respect to the Collateral or any part thereof. In the event Se-
cured Party demands, or attempts to take possession of
the Collateral in the exercise of any rights under this Agreement, Debtor promises and agrees to promptly turn over and deliver complete possession thereof to Secured Party;
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(iii) Require Debtor to assemble the Collateral, or any portion thereof, at a place designated by Secured Party and reasonably convenient to both parties, and promptly to deliver such Collateral to Secured Party, or an agent or representative designated
by it. Secured Party, and its agents and representatives, shall have the right to enter upon any or all of Debtor's premises and property to exercise Secured Party's rights hereunder;
(iv) Foreclose this Agreement as herein provided or in any manner permitted by law, and exercise any and all of the rights and remedies conferred upon Secured Party by any deed of trust or in any other document executed by Debtor in connection with indebtedness secured hereby, either concurrently or in such order as Secured Party may determine, and sell or cause to be sold in such order as Secured Party may determine, as a whole or in such parcels as Secured Party
may determine, the Collateral or the property described in any such deed of trust, or both, without affecting in
any way the rights or remedies to which Secured Party may
be entitled under the other such instruments;
(v) Sell, lease or otherwise dispose of the
Collateral at public sale, without having the Collateral
at the place of sale, and upon terms and in such manner
as Secured Party may determine. Secured Party may be a
purchaser at any sale; and
(vi) Exercise any remedies of a secured party under the Uniform Commercial Code of California or any
other applicable law.
(b) Unless the Collateral is perishable or threatens to decline rapidly in value or is of a type customarily sold on a recognized market, Secured Party shall give Debtor at least five (5) days' prior written notice of the time and place of
any public sale of the Collateral or other intended
disposition thereof to be made. Such notice may be mailed to
Debtor at the address set forth in the Loan Agreement.
(c) The proceeds of any sale under paraar aDh 7(al shall be applied by Secured Party, in its sole discretion, to any of
the following:
(i) To the repayment of the reasonable costs and expenses of retaking, holding and preparing for the sale and the selling of the Collateral (including attorneys' fees and costs) and the discharge of all assessments, encumbrances, charges or liens, if any, on
the Collateral prior to the lien hereof (except any
taxes, assessments, encumbrances, charges or liens subject to which such sale shall have been made);
(ii) To the payment of the amount then due and unpaid of the indebtedness of Debtor to Secured Party
(including principal and interest) referred to in
ParaaraDh 2 above;
(iii) To the payment of all other amounts (including principal and interest) then secured hereunder; and
(iv) The surplus, if any, shall be paid to the Debtor or to whomsoever may be lawfully entitled to receive the same, or as a court of competent jurisdiction may direct.
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Secured Party shall have the right to enforce one or more remedies hereunder, successively or concurrently, and such action shall not operate to estop or prevent Secured Party from pursuing
any further remedy which it may have, and any repossession or retaking or sale of the Collateral pursuant to the terms hereof shall not operate to release Debtor until full payment of any deficiency has been made in cash.
8. Notices. All notices, requests and demands to be made hereunder to the parties hereto shall be in writing and shall be given as provided in the Loan Agreement.
9. Other Remedies. Any and all remedies herein expressly conferred upon Secured Party shall be deemed cumulative with and not exclusive of any other remedy conferred hereby or by law on Secured Party, and the exercise of any one remedy shall not preclude the exercise of any other.
10. Waiver. By exercising or failing to exercise any of its rights, options or elections hereunder, Secured Party shall not be deemed to have waived any Potential Default, Potential Balancing
Default or Event of Default on the part of Debtor or to have released Debtor from any of its obligations secured hereby, unless
such waiver or release is in writing and is signed by Secured Party. In addition, the waiver by Secured Party of any Potential Default, Potential Balancing Default or Event of Default for default in payment of any indebtedness secured hereby shall not be
deemed to constitute a waiver of any succeeding Potential Default,
Potential Balancing Default or Event of Default.
11. Affixed Collateral. The inclusion in this Agreement of any Collateral which may now be, or hereafter become, affixed or in any manner attached to the Property shall be without prejudice
to any claim at any time made by Secured Party that such Collateral
is, or has become, a part of the Property, or an accession to such
Property.
12. Purther Seaurity Agreement.. Debtor further promises and agrees to execute from time to time, as Secured Party may require, security agreements and financing statements specifically including, in addition to the Collateral listed in Exhibit B, such additional goods, documents, contract rights, accounts receivable or general intangibles of type or kind similar in which Debtor hereafter owns or to those listed in Exhibit B
acquires any interest or right, including, without limitation,
leased personal property, and which are now or hereafter located on
or used or useful in the construction, operation, use or occupancy
of the Project.
..
13 expenses and be incurred
. Attorneys' Pees. Debtor agrees to pay all charges,
costs, including reasonable attorneys' fees, which may in the enforcement of this Agreement whether or not
such enforcement includes the filing of a lawsuit. As used herein,
I*attorneys' fees" shall have the meaning given such term in the
Loan Agreement.
14. Binding Upon Succe8sor8. All agreements, covenants, conditions and provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
15. GOVERNING LAW. THIS AGREBNENT SHALL BE WVBRBTED BY
AND CONSTRUED IN ACCORDMICE WITH THE LAWS OF TEE STATE OF
CALIFORNIA.
16. Amendment. This Agreement can be modified or rescinded only by a writing expressly referring to this Agreement and signed by all of the parties.
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17. Invalidity of Provisions. Every provision of this Agreement is intended to be severable. If any term or provision hereof is declared by a court of competent jurisdiction to be
illegal, invalid or unenforceable for any reason whatsoever, such
illegality, invalidity or unenforceability shall not affect the balance of the terms and provisions hereof, which terms and
provisions shall remain binding and enforceable, and to the extent possible all of the other provisions shall nonetheless remain in full force and effect.
18. Counterparts. This Agreement may be executed in counterparts each of which shall be deemed an original and all of
which shall constitute one and the same Agreement with the same
effect as if all parties had signed the same signature page. Any signature page of this Agreement may be detached from any counterpart of this Agreement and reattached to any other counterpart of this Agreement identical in form hereto but having attached to it one or more additional signature pages.
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IN WITNESS WHEREOF, the undersigned has executed this
Security Agreement Documents as of the date first above written.
DEBTOR :
CIP LIMITED, L.P.
A California Limited
Partnership
Bv its General Par tner :
Whammy, Inc. A California corporation
By:
By:
By:
By:
By:
By:
Jeffrey C. Hamann, President
Daniel M. Whitaker, Secretary
Jeffrey C. Hamann, as an individual and as Trustee of the J.C. Hamann Family
Trust, UTD 4/25/86
Gregg Hamann, as an individual and as Trustee of the Gregg Hamann Family
Trust, UTD 4/25/86
Daniel M. Whitaker as an individual
Daniel M. Whitaker and/or
Dona C. Whitaker, Co- Trustees of the Whitaker
Family Trust, UTD 10/22/79,
as Amended and Restated
12/22/83
SECURED PARTY:
FIRST INTERSTATE BA#A
A California corporation OF CALIFORNIA,
By:
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EXHIBIT A
LEGAL DESCRIPTION OF PROPERTY
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EXHIBIT B
DESCRIPTION OF THE COLLATERAL
As used in this Exhibit B, the term "Property" means
that certain real property, including all improvements now or hereafter located thereon, more particularly described in Exhibit A attached hereto.
(a) All personal property, including, without limitation, all goods, supplies, equipment, furniture,
furnishings, fixtures, machinery, inventory and construction materials which Debtor now or hereafter owns or in which Debtor now or hereafter acquires an interest or right, including, without limitation, those which are now or hereafter located on or affixed to the Property or used or useful in the operation, use or occupancy thereof or the construction of any improvements thereon, including, without limitation, any interest of Debtor in and to personal property which is leased or subject to any superior security interest, or which is being manufactured or assembled for later installation into the improvements to be located or constructed at the Property, whenever located, and all books, records, leases and other documents, of whatever kind or
character, relating to the Property;
(b) All fees, income, rents, issues, profits,
earnings, receipts, royalties and revenues which, after the date hereof and while any portion of the indebtedness secured hereby
remains unpaid, may accrue from said goods, fixtures, furnishings, equipment and building materials or any part thereof or from the Property or any part thereof, or which may be received or receivable by Debtor from any hiring, using, letting, leasing, subhiring, subletting, or subleasing therefor;
(c) All of Debtor's present and future rights to receive payments of money, services or property including,
without limitation, rights to all deposits from tenants of the
Property, deposits from prospective purchasers of the Property, capital contributions from the constituent partners of Debtor (if Debtor is a partnership), amounts payable on account of the sale
of partnership interests or stock of Debtor, accounts receivable,
deposit accounts, chattel paper, notes, drafts, contract rights
(including, without limitation, all rights under any interest
rate hedging or similar agreement), instruments, general intangibles and principal, interest and payments due on account of goods sold, services rendered, loans made or credit extended, together with title or interest in all documents evidencing or securing the same;
(d) All other intangible property and rights relating to the Property or the operation thereof, or used in connection therewith, including but not limited to all governmental permits relating to construction or other activities on the Property, all names under or by which the Property may at any time be operated or known, all rights to carry on business under any such names, or any variant thereof, all trade names and trademarks relating in any way to the Property, good will in any way relating to the
Property, and all licenses and permits relating in any way to, or to the operation of, the Property;
(e) All proceeds from sale or disposition of the aforesaid collateral;
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(f) Debtor's rights under all insurance policies covering the Property or any of the aforesaid collateral, and all proceeds, loss payments and premium refunds payable regarding the
same;
(g) All reserves, deferred payments, deposits,
refunds, cost savings and payments of any kind relating to the construction of any improvements on the Property;
(h) All water stock relating to the Property;
(i) All causes of action, claims compensation and
recoveries for any damage to or condemnation or taking of the
Property or the aforesaid collateral, or for any conveyance in lieu thereof, whether direct or consequential, or for any damage or injury to the Property or the aforesaid collateral, or for any loss or diminution in value of the Property or the aforesaid
collateral;
(j) All architectural, structural, mechanical and
engineering plans and specifications prepared for construction of
improvements or extraction of minerals from the Property and all studies, data and drawings related thereto; and also all contracts and agreements of the Debtor relating to the aforesaid plans and specifications or to the aforesaid studies, data and drawings or to the construction of improvements on or extraction
of minerals or gravel from the property;
(k) All Debtor's rights in proceeds of the loan
evidenced by that certain Loan Agreement of even date herewith
executed between Debtor and Issuer;
(1) All Debtor's rights to receive the proceeds of any Vake-outI1 or permanent financing or commitment to provide such financing.
All terms used herein which are defined in the
California Commercial Code shall have the same meanings when used
herein, unless the context requires otherwise.
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