EXHIBIT A
ASSET PURCHASE AGREEMENT
BY AND BETWEEN
H & S FISH FARMS, INC.
AS BUYER
AND
FARM FISH, INC.
AS SELLER
JULY 20, 2000
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TABLE OF CONTENTS
ARTICLE 1TRANSACTION
1.1 Transaction.....................................................2
1.2 Lease Option Prior To Closing...................................2
1.3 Purchase Price..................................................3
1.4 Share Purchase Price . . . . . . . . . . . . . . . . . . . . . .3
1.5 Escrow Deposit..................................................4
1.6 Prorations......................................................4
1.7 Allocation of Purchase Price....................................5
1.8 Contesting of Assumed Liabilities; No Third Party Beneficiaries.5
1.9 Costs of Closing................................................6
1.10 Inspection. ....................................................6
ARTICLE 2TITLE MATTERS
2.1 Title Report/Commitment for Title Insurance.....................7
2.2 Survey..........................................................7
2.3 Title Defects...................................................8
2.4 Title Insurance.................................................8
ARTICLE 3REPRESENTATIONS AND WARRANTIESOF SELLER
3.1 Organization and Qualification..................................9
3.2 Binding Agreement...............................................9
3.3 No Violation....................................................9
3.4 Absence of Certain Changes.....................................10
3.5 Litigation or Proceeding.......................................10
3.6 Contracts......................................................10
3.7 Title to Assets................................................10
3.8 Compliance with Law and Regulations............................11
3.9 Use of Assets..................................................11
3.10 FIRPTA.........................................................11
3.11 Payments. ....................................................11
3.12 Employees......................................................11
3.13 Absence of Creditors' Arrangements or Proceedings..............11
3.14 Inventory......................................................11
3.15 Shares. .......................................................12
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3.16 No Other Buyer Representations.................................12
3.17 Knowledge Standard.............................................12
ARTICLE 4REPRESENTATIONS AND WARRANTIES OF BUYER
4.1 Corporate Organization; Etc....................................12
4.2 Authorization of Agreement.....................................12
4.3 No Violation...................................................12
4.4 Litigation or Proceeding.......................................13
4.5 Consents and Approvals of Governmental Authorities.............13
4.6 Financial Statements. .........................................13
4.7 Inspection.....................................................13
4.8 Acquisition for Investment Purposes............................13
4.9 No Other Seller Representations................................14
4.10 "AS IS, WHERE IS"..............................................14
ARTICLE 5COVENANTS OF SELLER
5.1 Operations of Seller...........................................14
5.2 Change in Condition............................................15
5.3 Insurance......................................................15
5.4 Payment of Liabilities.........................................15
5.5 Notification of Subsequent Events. ............................15
5.6 Environmental Study. ..........................................15
5.7 Post Closing Transactions. ....................................15
5.8 Representations and Warranties.................................15
5.9 Alienation of Assets...........................................16
5.10 Mortgages......................................................16
5.11 Employees......................................................16
ARTICLE 6COVENANTS OF BUYER
6.1 Affected Employees. ...........................................16
6.2 Financial Statements. .........................................16
ARTICLE 7CONDITIONS TO BUYER'S OBLIGATION TO CLOSE
7.1 Representations and Warranties True at Closing.................17
7.2 Compliance with Agreement......................................17
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7.3 No Adverse Change..............................................17
7.4 Litigation.....................................................17
7.5 Opinion of Counsel. ...........................................17
7.6 Evidence of Authority..........................................17
7.7 Closing Documents..............................................17
7.8 Possession of Assets...........................................18
ARTICLE 8CONDITIONS TO SELLER'S OBLIGATIONS TO CLOSE
8.2 Payment of Purchase Price......................................18
8.3 Representations and Warranties True at Closing.................18
8.4 Compliance with Agreement......................................18
8.5 Litigation. ...................................................18
8.6 Opinion of Counsel. ...........................................18
8.7 Evidence of Authority..........................................19
8.8 Instruments Relating to the Seller Financing and Transfer. ....19
8.9 Buyer's Financial Statements. .................................19
ARTICLE 9CLOSING; TERMINATION; POST CLOSING
9.1 Closing........................................................19
9.2 Termination....................................................19
9.3 Breach by Buyer................................................19
9.4 Breach by Seller...............................................20
9.5 Knowledge as a Defense. .......................................20
9.6 Post-Closing Deliveries........................................20
ARTICLE 10RISK OF LOSS
10.1 Risk of Loss. .................................................21
ARTICLE 11MISCELLANEOUS
11.1 Consents.......................................................21
11.2 Contested Assignment...........................................21
11.3 Limited Survival...............................................22
11.4 Successors or Assigns..........................................22
11.5 No Benefit to Others. .........................................22
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11.6 Announcements..................................................22
11.7 Further Assurances. ...........................................22
11.8 Broker's Fees..................................................22
11.9 Notices........................................................23
11.10 Counterparts..................................................23
11.11 Facsimile Signatures..........................................23
11.12 Headings......................................................23
11.13 Governing Law.................................................23
11.14 Waiver of Jury Trial..........................................23
11.15 Arbitration...................................................23
11.16 Attorneys' Fees...............................................24
11.17 Computation of Time Periods. .................................24
11.18 Time of the Essence...........................................24
11.19 No Waiver.....................................................24
11.20 Exclusiveness.................................................24
11.21 Severability..................................................24
11.22 Interpretation, No Presumption................................24
11.23 Exhibits......................................................25
11.24 Confidentiality...............................................25
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ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement (this "AGREEMENT") dated this 20th day
of July, 2000 ("EFFECTIVE DATE"), is made by and between H & S Fish Farms,
Inc., a Mississippi corporation, with its principal place of business at
_______________ ("BUYER"), and Farm Fish, Inc., a Mississippi corporation,
with its principal place of business in Humphreys County, Mississippi
("SELLER").
WHEREAS, Seller owns and operates a catfish farming operation located
in Humphreys County, Mississippi (collectively, the "BUSINESS");
WHEREAS, Buyer desires to purchase certain of the assets of Seller
pursuant to the terms and conditions set forth herein;
WHEREAS, Seller desires to sell, transfer and convey certain of its
assets to Buyer as set forth herein;
WHEREAS, Seller desires to sale its entire inventory of fish, in the
ordinary course of business without restocking, to third parties prior to
Closing of the transactions contemplated hereby;
WHEREAS, Seller and Buyer acknowledge that Seller's liquidation of its
fish inventory will extend over a period of many months following the
Effective Date, and the transactions set forth herein shall extend over
such period, ending on the Closing Date;
WHEREAS, Seller is willing, if requested by Buyer, to allow Buyer
access to certain of the Assets prior to Closing pursuant to the terms of
the lease attached hereto after Seller has vacated a portion of the Assets;
WHEREAS, Buyer intends to take only partial possession of the property
upon execution of this Agreement;
WHEREAS, Buyer intends to make capital improvements upon the assets as
Buyer takes possession;
WHEREAS, Buyer is willing to pay, and Seller is willing to accept a
rental payment in the amount of $100.00 while Buyer is completing such
capital improvements;
WHEREAS, upon Closing, Seller shall finance the Purchase Price in
accordance with the terms set forth herein; and
WHEREAS, after the 180{th} day after Closing, Seller shall liquidate
and distribute its net proceeds (after payment of its debts and
obligations) to its shareholders.
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NOW, THEREFORE, in consideration of the premises and the respective
mutual agreements, representations and warranties contained herein, the
sufficiency of which is hereby acknowledged, the parties intending to be
legally bound agree as follows:
ARTICLE 1
TRANSACTION
1.1 TRANSACTION. The recitals set forth above are incorporated
herein by this reference. Subject to the terms and conditions contained
herein, Seller shall sell, transfer and convey and Buyer shall purchase
certain assets of Seller used or available for use in connection with the
operation of the Business, including, without limitation, certain real and
personal property listed on EXHIBIT 1.1(A) (REAL AND PERSONAL PROPERTY
SCHEDULE) (collectively, the "ASSETS"), except for the Excluded Assets (as
defined below). Seller shall liquidate its current inventory between the
Effective Date and the Closing Date. As Seller liquidates its inventory,
Seller shall lease such portion of the Assets as are released by such
liquidation to Buyer, under the terms and conditions set forth in
subparagraph 1.2 and the Real Estate Lease attached hereto. The parties
expressly acknowledge and agree that EXHIBIT 1.1(A) may not include all
contracts of Seller and shall be amended at Closing (as defined below) to
clarify exactly which contracts, if any, will be a part of the Assets being
conveyed to Buyer. Buyer hereby elects to exclude all contracts from the
Assets being conveyed at Closing ("EXCLUDED CONTRACTS"). The Excluded
Contract shall not be deemed to be an Asset to be purchased hereunder, but
shall be deemed to be an Excluded Asset.
Buyer and Seller expressly agree that the Assets do not include in any
manner the items of Seller's property listed on EXHIBIT 1.1(B) (EXCLUDED
ASSETS), and such items of Seller's property shall not be sold,
transferred, assigned or conveyed to Buyer at the Closing ("EXCLUDED
ASSETS").
At Closing, Buyer will only assume certain obligations, liabilities
and indebtedness of Seller relating to the Contracts in accordance with
their terms and pursuant to the terms of the Assignment and Assumption
Agreement, in the form attached hereto (collectively, the "ASSUMED
LIABILITIES"). Notwithstanding any other provision of this Agreement,
Seller hereby acknowledges and agrees that Buyer has only agreed to assume
certain specified liabilities, obligations and indebtedness of Seller and
nothing contained herein or in any documents executed in connection
herewith shall be deemed an assumption of any obligations, liabilities or
indebtedness of Seller other than the Assumed Liabilities. Therefore,
Seller shall remain liable for and the responsible party with respect to
any and all obligations, liabilities or indebtedness not being expressly
referenced and assumed by Buyer hereunder and Seller shall timely perform
in full their liabilities and obligations relating thereto.
1.2 LEASE OPTION PRIOR TO CLOSING. In the event that: (i) Seller,
in its sole and absolute discretion, elects to remove its fish inventory
from certain portions of the Real Property prior to Closing ("Vacated
Land") and (ii) Buyer, in its sole and absolute discretion,
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elects to take
possession of the Vacated Land for purposes of improving the ponds and
other improvements located on the Vacated Land and/or stocking fish into
any ponds located on the Vacated Land, Buyer shall lease such Vacated Land
and any related equipment contained with the Assets to be transferred from
Seller pursuant to the terms of the form leases attached hereto as EXHIBIT
1.2. The terms of such lease shall include, without limitation, a lease
term of no more than twenty-four (24) months (the exact term will be based
on the period of time remaining prior to the projected Closing Date and
shall be subject to acceleration and immediate termination in the event of
a default under this Agreement), rental payments of $100 per month if
Buyer's only use of the Vacated Land is to undertake capital improvements,
monthly rental payments based on a six percent (6%) interest factor of the
mutually agreed upon allocated portion of the Purchase Price applicable to
the Vacated Land if Buyer's use of any portion of the Vacated Land is to
operate, stock or grow fish in any manner. Simultaneous with Buyer leasing
any portion of the Real Property, Buyer shall have the option, at its sole
discretion, to close the purchase of certain items of tangible Personal
Property contained within the Assets as selected by Buyer and approved by
Seller. The purchase price of such items of Personal Property shall be
equal to the allocated portion of the Purchase Price relating to such items
and shall be payable in full in immediately available funds at the time of
such transfer.
1.3 PURCHASE PRICE. Upon and in accordance with the terms and
conditions of this Agreement, Seller agrees to sell, and Buyer agrees to
purchase, the Assets for a total purchase price equal to the sum of One
Million Eight Hundred Thousand and 00/100 Dollars ($1,800,000) ("PURCHASE
PRICE"), plus or minus prorations and other adjustments provided by this
Agreement. The Purchase Price shall be paid in the form of $1,500,000.00
negotiable promissory note made payable to the order of Seller and its
assigns ("NOTE") bearing a six percent (6%) interest rate per annum payable
in quarterly installments as necessary to fully amortize the principal
balance over a ten (10) year period; secured by a first priority lien on
the assets pursuant to a Deed of Trust and Security Agreement and such
other loan documents as reasonably requested by Seller or its counsel, the
forms of such are attached hereto as EXHIBIT 1.3 (collectively, the
"SECURITY DOCUMENTS"). The balance of the Purchase Price shall be payable
in full in immediately available funds at Closing.
1.4 SHARE PURCHASE PRICE. In addition to the Purchase Price set
forth above, upon and in accordance with the terms and conditions of this
Agreement, Seller agrees to sell, and Buyer agrees to purchase, 1908 shares
of stock of Producer's Feed ("SHARES")for a total purchase price equal to
$25.00 per share for a sum of Forty-seven Thousand Seven Hundred and
00/100 Dollars ($47,700.00) ("SHARE PURCHASE PRICE"). Seller agrees to
sell, and Buyer agrees to purchase 200 Shares which shall be transferred by
Seller to Buyer simultaneous with the execution of this Agreement and upon
payment of $5,000.00 of the Share Purchase Price by Buyer to Seller in
immediately available funds. Seller agrees to grant, and Buyer shall have
an option to purchase which may only be exercised prior to Closing the
balance of the Shares (1708) which shall be transferred by Seller to Buyer
at Closing and upon payment of the balance of the Share Purchase Price
($42,700.00) by Buyer to Seller in immediately available funds.
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1.5 ESCROW DEPOSIT. (a) Buyer shall within two (2) business days
following the Effective Date deliver to First American Title Insurance
Company ("TITLE COMPANY") the sum of One Hundred Thousand And No/100
Dollars ($100,000.00) ("ESCROW DEPOSIT") in lawful funds of the United
States of America. If Buyer elects to terminate this Agreement pursuant to
the express provisions hereof, then Title Company shall refund to Buyer the
Escrow Deposit and all interest accrued thereon. The Escrow Deposit and
all interest thereon shall be non-refundable to Buyer except in the case
of: (i) Seller's default; (ii) the non-satisfaction of the conditions set
forth in Section 7.1; or (iii) except as otherwise expressly set forth
herein. In any event, the Escrow Deposit shall be credited toward the
Purchase Price upon Closing. Title Company is hereby instructed to invest
the Escrow Deposit in an FDIC insured interest bearing account in the name
of Buyer. Buyer's taxpayer identification number is 64-0927035. Buyer and
Seller hereby acknowledge and agree that all accrued interest on the
deposit shall be credited to Buyer, PROVIDED, HOWEVER, in the event that
this transaction does not Close due to an event of default by Buyer and
through no event of default of Seller unless Seller's performance is
excused due to a prior default of Buyer, the Escrow Deposit and all accrued
interest thereon shall be delivered to Seller as herein set forth.
(b) The sole responsibility of Title Company shall be to hold and
disburse the Escrow Deposit in accordance with the terms of this Agreement
and, if a dispute shall arise with respect to the disposition of the Escrow
Deposit, the Title Company may continue to hold such funds until receipt of
written instructions acknowledged and agreed to by Buyer and Seller or may
deposit such funds with the applicable court of the county in which the
Project is located and interplead the Buyer and Seller in connection
therewith.
(c) Title Company is authorized and instructed to act as escrow agent
pursuant to the terms of this Agreement. By execution of the
acknowledgment attached hereto, Title Company acknowledges receipt of the
Escrow Deposit. Buyer and Seller shall execute any additional escrow
instructions reasonably required by Title Company to complete the
transactions provided for herein provided that such instructions are not
inconsistent with the terms of this Agreement.
1.6 PRORATIONS. The following prorations shall be made effective
as of the Closing Date and, to the extent possible, shall be made
tentatively at Closing:
a. PRORATION DATE. All prorations shall be made as of 12:01 a.m.,
according to the time zone in which the Assets are located, on the Closing
Date, as if Buyer were vested with title to the Assets during the entire
Closing Date.
b. TAXES. Ad valorem and personal property taxes and assessments
against the Assets for the year of Closing shall be prorated between Seller
and Buyer as of the Closing Date. If actual taxes are unknown, they shall
be prorated based upon the best available information from the local taxing
authority. To the extent that the actual taxes for the current year differ
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from the amounts so apportioned at Closing, Seller and Buyer shall make all
necessary adjustments by appropriate payments between themselves following
Closing.
c. UTILITIES. Charges for utilities serving the Assets shall be
determined as of the day preceding the Closing Date based on a reading of
the meter unless such is not reasonably available in which case it will be
based on the prior month's utility bills, and Seller shall pay the amount
of the utility charges to such date to the utility companies involved or to
Buyer in the event Buyer is responsible for the payment of such utility
charges. All utility deposits of Seller shall belong to Seller.
d. CONTRACT CHARGES. Charges with respect to Contracts (as defined
below), if any, actually transferred and assigned to Buyer shall be
prorated as of the Closing Date. Payments for obligations under leases of
tangible Personal Property transferred and assigned to Buyer will be
prorated as of the Closing Date. To the extent not reflected in the
closing statements evidencing the Transaction contemplated by this
Agreement, Buyer and Seller agree to adjust between themselves outside of
Closing any amounts which are the responsibility of the other party
pursuant to this subsection.
e. GENERAL LIABILITIES. Contractual and tort liabilities accruing,
or relating to events that occurred, prior to the Closing Date shall remain
the responsibility of Seller. Contractual liabilities relating to Contracts
expressly assumed by Buyer and accruing, or relating to events that occur,
from and after the Closing Date, shall be the responsibility of Buyer.
The agreements with respect to prorations in this Section 1.6 shall
survive Closing. Final settlement of all prorated items shall occur on or
before 90 days after the Closing Date, or on the next business day if the
90th day is a Saturday, Sunday or legal holiday, except property taxes
which shall be determined upon the date upon which any such amounts shall
become ascertainable.
1.7 ALLOCATION OF PURCHASE PRICE. The Purchase Price shall be
allocated among the Assets in the manner reasonably determined by Buyer and
Seller in writing prior to Closing. The parties make this allocation with
the knowledge and understanding that, if requested by Buyer, it will be
used by them for all purposes including federal and state income tax
purposes. Each party agrees that it will report the transactions in
accordance with such allocation and that it will not take a position
inconsistent with such allocation except with the written consent of the
other parties to this Agreement.
1.8 CONTESTING OF ASSUMED LIABILITIES; NO THIRD PARTY BENEFICIARIES.
Buyer reserves the right to contest in good faith any Assumed Liability.
Seller reserves the right to contest in good faith any liabilities or
obligations not expressly assumed by Buyer pursuant to the terms of this
Agreement. The assumption by Buyer on the Closing Date of any liabilities
hereunder is made for the exclusive benefit of Seller and not for the
benefit of any third party, and such assumption, while creating a liability
of Buyer to Seller hereunder, shall not be
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deemed to create any liability
of Buyer to any third party. The terms and provisions of this Agreement
are intended solely for the benefit of Buyer and Seller and their
respective successors or assigns, and it is not the intention of the
parties to confer any third-party beneficiary rights upon any other person
or entity.
1.9 COSTS OF CLOSING.
a. SELLER'S PAYMENTS. Seller shall pay the cost and expenses, if
any, of the title search and title insurance commitment for the owner's
title insurance policy and one-half of the expenses of the escrow, if any.
b. BUYER'S PAYMENTS. Buyer shall pay the cost and expenses, if any,
of (i) the fees for recording the deed conveying the Real Property; (ii)
the premium for the owner's and lender's title policy and the cost of all
applicable endorsements thereto; (iii) and one-half of the expenses of the
escrow, if any, and (iv) the cost of the survey, if any.
c. OTHER COSTS. Each party will pay all its own expenses incurred in
connection with this Agreement and the Transactions contemplated hereby,
including, without limitation (i) all costs and expenses stated herein to
be borne by a party, and (ii) all of their respective consulting,
accounting, investigation, legal and appraisal fees.
1.10 INSPECTION. Purchaser and/or its attorneys, consultants or
employees ("AUTHORIZED REPRESENTATIVES") have: made a physical inspection
of all Assets and to the extent Purchaser deemed necessary contacted and
confirmed with third parties the nature, scope and status of all Contracts
to be assigned to and assumed by Buyer, if any. All such inspections
shall be conducted at Buyer's sole expense. Buyer and/or Buyer's agents
and representatives shall have the right to conduct any and all such
physical, environmental and other inspections, reviews and other analysis
as Buyer considers to be appropriate relating to the Assets. Seller shall
cooperate with all such inspections and provide Buyer and/or its agents and
representatives with access to all assets, books and records in order to
facilitate the foregoing. Notwithstanding the foregoing, Buyer shall not
be permitted to interfere unreasonably with Seller's operations and the
scheduling of any inspections, interviews, and/or testing shall be at
reasonable times during normal business hours and shall take into account
the timing and availability of access to the applicable information and
property. Buyer shall at all times conduct such due diligence in
compliance with applicable laws, and in a manner so as to not cause undue
damage, loss, cost or expense to Seller or the Assets, and Buyer shall
promptly restore the Assets to their condition immediately preceding such
inspections and examinations and shall keep the Assets free and clear of
any mechanic's liens or materialmen's liens in connection with such
inspections and investigations. Seller shall have the right, at its
option, to cause a representative of Seller to be present at all such
inspections, reviews and examinations. Buyer shall keep all information or
data received or discovered in connection with such due diligence strictly
confidential. Buyer shall indemnify, protect, defend and hold Seller
harmless from and against any obligation, liability, claim (including any
claim for
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damage to property or injury to or death of any persons), lien or
encumbrance, loss, damage, cost or expense, including attorneys' fees
(collectively, the "LOSS"), in any way caused by the inspections or
examinations of the Assets by Buyer or its agents or contractors. The
foregoing indemnification shall terminate upon the first anniversary of the
Closing but shall survive the termination of this Agreement for any reason.
ARTICLE 2
TITLE MATTERS
2.1 TITLE REPORT/COMMITMENT FOR TITLE INSURANCE. Seller hereby
instructs Title Company to prepare and deliver to Buyer, Seller and the
surveyor, if any, at Seller's expense, within ten (10) business days after
the Effective Date a commitment to issue an owner's and if applicable a
lender's title insurance policy to be issued by a title company reasonably
acceptable to Buyer (the "INITIAL TITLE COMMITMENT") covering the Real
Property, showing all matters, including, without limitation, any
environmental liens of record, affecting title to the Real Property and
binding Title Company to issue to Buyer at Closing an owner's policy of
title insurance on an ALTA (1992 form) extended form of policy in the
amount of the Purchase Price applicable to the real property and
improvements. Upon receipt of Seller's Closing Notice, Seller shall
instruct Title Company to prepare and deliver to Buyer, Seller and the
surveyor, if any, described below, at Seller's expense, within ten (10)
business days after the Closing Notice Date, an updated commitment to issue
an owner's title insurance policy to be issued by the Title Company (the
"UPDATED TITLE COMMITMENT") covering the Real Property, showing all matters
affecting title to the Real Property and binding Title Company to issue to
Buyer at Closing an owner's policy of title insurance on an ALTA (1992
form) extended form of policy in the amount of the Purchase Price
applicable to the real property and improvements. Seller and Buyer further
instruct Title Company to deliver to all such parties copies of all
instruments referenced in Schedule B, Section II of each of the Title
Commitments.
2.2 SURVEY. Within ten (10) days after the Effective Date, Buyer
may, at its expense and at its option, order a survey or an update to a
survey and shall use reasonable efforts to cause such survey to be
delivered to Seller and Title Company within ten (10) business days after
the Effective Date. Such survey may at the option of Buyer and its lender
be either a Class B or a Class A ALTA/ASCM land title survey of the Land
and of the Improvements situated thereon (the "INITIAL SURVEY"), prepared
by a surveyor licensed by Mississippi and certified to Seller, Buyer and
Title Company by such surveyor. Within ten (10) days after the Closing
Notice Date, Seller may, at its expense and at its option, order an update
to the Initial Survey ("UPDATED SURVEY") and shall use reasonable efforts
to cause such Updated Survey to be delivered to Buyer and Title Company
within ten (10) business days after the Closing Notice Date. Seller shall
provide at Closing a certificate to Buyer and Title Company, if requested,
that there have been no improvements made to the Real Property since the
date of the Initial Survey which would materially alter the depictions on
the Initial Survey.
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2.3 TITLE DEFECTS. Within ten (10) days after receipt of the later
of the Initial Title Commitment and the Initial Survey, if any, Buyer shall
notify Seller of any title matters to which Buyer objects (the "TITLE
DEFECTS") ("BUYER'S NOTICE"). Any matter disclosed in a Title Commitment
or Survey and not objected to by Buyer or subsequently waived by Buyer
shall be deemed a permitted exception ("PERMITTED EXCEPTION"). Seller
shall notify Buyer of Seller's decision not to cure any Title Defect within
ten (10) days after receipt of Buyer's Notice; provided, however, Seller
shall remove monetary liens relating to borrowed funds or other liens
securing indebtedness of an ascertainable amount and mechanic or
materialmen's liens, if any. Seller's failure to respond shall be deemed a
decision by Seller not to cure any Title Defect. Within ten (10) days of
Seller's election not to cure certain Title Defects, Buyer may (i) elect to
waive such Title Defects or (ii) terminate this Agreement and receive a
full refund of the Escrow Deposit. Buyer's failure to respond shall be
deemed a decision by Buyer to waive any and all Title Defects. If the
Title Defects, that Seller elected to cure, are not cured by Seller or
waived by Buyer on or before the Closing Date then Buyer may (i) elect to
waive the uncured Title Defects or (ii) terminate this Agreement and
receive a full refund of the Escrow Deposit. Within ten (10) days after
receipt of the later of the Updated Title Commitment and the Updated
Survey, if any, Buyer shall notify Seller of any title matters not
reflected on the Initial Title Commitment or Initial Survey to which Buyer
objects (the "NEW TITLE DEFECTS") ("UPDATE NOTICE"). Any new matter not
objected to by Buyer or subsequently waived by Buyer shall be deemed a
Permitted Exception. Seller shall notify Buyer of Seller's decision not to
cure any New Title Defect within ten (10) days after receipt of Buyer's
Title and Survey Notice; provided, however, Seller shall remove or bond
around monetary liens relating to borrowed funds or other liens securing
indebtedness of an ascertainable amount and mechanic or materialmen's
liens, if any. Seller's failure to respond shall be deemed a decision by
Seller not to cure any New Title Defect. Within five (5) days of Seller's
election not to cure certain New Title Defects, Buyer may elect to waive
such New Title Defects, or, if the New Title Defect involves a monetary
lien or obligation or otherwise has a material adverse effect on the
Assets, Buyer may terminate this Agreement and receive a full refund of the
Escrow Deposit. Buyer's failure to respond shall be deemed a decision by
Buyer to waive the New Title Defects to which Seller decides not to cure.
If the New Title Defects that Seller elected to cure are not cured by
Seller or waived by Buyer on or before the Closing Date then Buyer may
elect to waive the uncured New Title Defects or, if the New Title Defect
involves a monetary lien or obligation or otherwise has a material adverse
effect on the Project, Buyer may terminate this Agreement and receive a
full refund of the Escrow Deposit. Notwithstanding anything herein to the
contrary, any lien that may be discharged by the payment of money may be
paid and discharged at Closing out of the proceeds of the Purchase Price.
2.4 TITLE INSURANCE. At Closing, Seller and Buyer shall instruct
Title Company to issue a final update to the Title Commitment in which the
"GAP" exception has been deleted, binding Title Company to issue to Buyer
an owner's policy and if applicable a lender's policy of title insurance
(the "TITLE POLICY") covering the Real Property in the full amount of the
Purchase Price. In addition, Title Company shall, if requested, provide an
insured closing
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letter verifying the authority of the applicable agent of
the Title Company. The Title Policy shall be an ALTA Form 1992 owner's or
lender's policy of extended coverage title insurance with the creditor's
rights exception deleted containing such endorsements as may be reasonably
requested by Buyer and agreed to by Title Company subject only to: (a)
current non-delinquent real estate taxes and assessments; (b) matters set
forth in the Title Commitment and approved or waived by Buyer; (c) any
other matters approved in writing by Buyer; (d) title exceptions caused by
acts or omissions of Buyer; and (e) matters excepted or excluded from
coverage by the printed terms of the title insurance policy's standard
jacket form. The standard exceptions such as survey and mechanics and
materialmen's lien shall be deleted.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES
OF SELLER
Seller hereby represents and warrants to Buyer that the following
matters are true as of the date of executing this Agreement and will be
true at Closing:
3.1 ORGANIZATION AND QUALIFICATION. Seller (i) is a corporation duly
organized, validly existing and in good standing under the laws of
Mississippi, and (ii) has the power and authority to execute, deliver and
perform this Agreement and the transactions contemplated hereby.
3.2 BINDING AGREEMENT. Subject to the prior approval of the
shareholders of Seller, the execution, delivery and performance of this
Agreement has been duly authorized by all necessary action by Seller and
constitutes the legal, valid and binding obligation of Seller, enforceable
in accordance with its terms. Such shareholder approval is a condition
precedent to the consummation of the transactions contemplated hereby other
than the lease of the Real Property as contemplated hereby.
3.3 NO VIOLATION. Neither the execution and delivery of this
Agreement, nor the performance by Seller of its obligations hereunder nor
the consummation of the transactions contemplated hereby will (a) violate,
be in conflict with, constitute a default under, permit the termination of,
or cause the acceleration of the maturity of any debt or obligation of
Seller which violation, conflict, default, termination or acceleration
individually or in the aggregate with all such other violations, conflicts,
defaults, terminations and accelerations would have a material adverse
effect on the Assets or on any of the Contracts (as defined below); (b)
require the consent of any other person (other than the shareholders of
Seller) to, constitute a breach of any agreement, permit, license or
commitment to which Seller is a party or by which they or any of its
property is bound (which individually or in the aggregate with all other
such breaches would have a material adverse effect on the Assets); (c)
result in the creation or imposition of any lien upon any of Seller's
Assets under any agreement or commitment to which Seller is a party or by
which it is bound which would have a material adverse effect
<PAGE>
upon the
Assets; or (d) violate any statute or law or any judgment, decree, order,
regulation or rule of any court or governmental authority to which Seller
is subject.
3.4 ABSENCE OF CERTAIN CHANGES. Except as set forth on SCHEDULE
3.4, since July 1, 2000, there has not been (i) any change in the Assets
other than changes in the ordinary course of business, none of which has
been materially adverse; or (ii) any other event or condition of any
character which, individually or in the aggregate, materially and adversely
affects the Assets. Buyer acknowledges that Seller will be selling its
entire inventory of fish to third parties prior to Closing and in
connection therewith abandoning certain areas of the Real Property as
determined by seller in its sole discretion.
3.5 LITIGATION OR PROCEEDING. There is no suit, claim, action or
investigation pending or, to the best knowledge of Seller, threatened by or
against Seller affecting the Assets, before any federal, state, municipal
or other governmental court, department, commission, board, bureau, agency
or instrumentality wherever located, which possibly could prevent the
consummation of the transactions contemplated by this Agreement or
adversely affect Buyer's enjoyment of or diminish the value of the Assets.
3.6 CONTRACTS. Attached hereto as EXHIBIT 3.6(A) (CONTRACTS
SCHEDULE) is a list of all contracts and leases affecting or relating in
any material manner to the Assets (collectively, the "CONTRACTS"). Except
for contracts listed in EXHIBIT 3.6(A), there are no contracts, leases or
agreements of any nature, either oral or written, affecting or relating in
any material manner to Seller or the Assets or any part thereof. All of
the Contracts contain the entire agreement of the parties thereto, are in
full force and effect in accordance with their respective terms, and to the
best of Seller's knowledge, no event exists which, with notice or the
passage of time or both, would constitute an event of default by Seller or
any other party thereunder. No party to any Contract has threatened to
cancel or terminate such Contract or to Seller's knowledge alleged any
default or event which, with notice or passage of time or both, would
constitute an event of default under any such Contract. In addition, to
Seller's knowledge, no party to any such Contract has any counterclaim,
defense or offset relating in any manner thereto. No Contract or any right
or portion thereof has been assigned, encumbered or subjected to any liens
by Seller, except to lenders whose liens shall be released at Closing. No
Contracts have been amended or modified and no terms have been waived in
any manner except as set forth on EXHIBIT 3.6(A). Seller has paid in full
all payments required by the terms of the Contracts to be paid prior to the
date hereof. True and complete copies of all agreements, contracts,
arrangements, plans and other things referred to in EXHIBIT 3.6(A) have
been delivered to Buyer.
3.7 TITLE TO ASSETS. Seller has good, valid and marketable title to
its Assets and the Assets are held by Seller and will be transferred to
Buyer free and clear of any liens, encumbrances, restrictions or equitable
rights of any other party, except for the Permitted Exceptions. A list of
all material Assets are contained on EXHIBIT 1.1(A) attached hereto.
<PAGE>
3.8 COMPLIANCE WITH LAW AND REGULATIONS. To the best of Seller's
knowledge, the Assets, and the use and operation thereof are in material
compliance with all applicable federal, state, municipal and other
governmental laws, ordinances, rules, regulations, licenses, permits and
authorizations (collectively, the "LAWS OR REGULATIONS"). To the best of
Seller's knowledge, Seller has not received any notice or been made aware
of any charge asserting any violation of any such Laws or Regulations.
3.9 USE OF ASSETS. To Seller's knowledge, (i) no governmental,
public or private authority intends or desires to appropriate the use of or
limit the use of any of the Assets pursuant to any condemnation, eminent
domain or similar proceeding; (ii) no fact or condition exists which will
result in the termination of the Seller's current access to and from
existing streets and utilities.
3.10 FIRPTA. Seller is not a "foreign person" (as defined in the
Internal Revenue Code and Income Tax Regulations). The provisions of the
Foreign Investment in Real Property Tax Act of 1980, as amended, are not
applicable to the Transaction.
3.11 PAYMENTS. To the best of Seller's knowledge, Seller has not,
directly or indirectly, paid or delivered or agreed to pay or deliver any
fee, commission or other sum of money or item of property, however
characterized, to any government official or representative in any manner
related to the Assets which is illegal under any federal, state or local
law.
3.12 EMPLOYEES. EXHIBIT 3.12(A) (CURRENT EMPLOYEES) sets forth a
current schedule of all full and part-time employees of Seller, setting
forth in respect of each their position, duties, current salary or wages.
Seller is not a party to or bound by any employment agreement or any
collective bargaining agreement respecting employees, nor to the best of
Seller's knowledge are there pending or threatened any strike, walkout or
other work stoppage or any union organizing effort relating to the Assets.
There is no unfair practice claim against Seller before the National Labor
Relations Board, or any strike, dispute, slowdown, or stoppage pending or
threatened against or involving the Assets. Seller is in material
compliance with all federal and state laws respecting employment and
employment practices, terms and conditions of employment, and wages and
hours. There are no pending or, to the best of Seller's knowledge,
threatened EEOC claims, wage and hour claims, unemployment compensation
claims, workers' compensation claims or the like against Seller.
3.13 ABSENCE OF CREDITORS' ARRANGEMENTS OR PROCEEDINGS. Seller has
not made any arrangement with Seller's creditors other than in the ordinary
course of business, nor have any involuntary or voluntary proceeding been
instituted against or by Seller or relating to any of their property under
any bankruptcy, insolvency or similar law.
3.14 INVENTORY. The Assets do not include any inventory of Seller of
any type, including, without limitation, fingerlings, broodfish, foodfish
or feed, supplies or chemicals of any type. Seller will undertake to
dispose of its inventory prior to
<PAGE>
Closing in such manner as Seller deems
appropriate in its sole and absolute discretion.
3.15 SHARES. Buyer is the sole holder of record, beneficial or
otherwise, of all of the Shares. Except for the restrictions and
encumbrances established by Producer's Feed's Articles of Incorporation and
other organizational documents, noted on the face of the certificate and
under applicable federal and state securities laws and regulations, the
Shares are free and clear of any restriction, pledge, claim, lien, security
interest or encumbrance thereon or affecting the title thereto. Other than
Producer's Feed and as noted on the certificate, no other person owns or
has any other rights with respect to the Shares. To the best of Seller's
knowledge, no Shares have been issued or transferred in violation of any
preemptive or other rights of any person, or any laws or regulations of any
governmental authority to which such issuance or transfer may have been
subject. There are no outstanding obligations or commitments to purchase,
redeem or otherwise acquire any of the Shares, except for this Agreement.
3.16 NO OTHER BUYER REPRESENTATIONS. Except as expressly set forth
herein, Seller acknowledges that no representations or warranties, express
or implied, have been made by Buyer or Buyer's representatives.
3.17 KNOWLEDGE STANDARD. As used in this Agreement, "TO SELLER'S
KNOWLEDGE", "TO THE BEST OF SELLER'S KNOWLEDGE" or any similar phrase,
shall mean the current actual knowledge of Tom Slough and Jayne Dew;
provided, however, that nothing in this Agreement shall be deemed to create
or impose any personal liability of any kind on either of them.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to Seller that the following matters are
true as of the date executing this Agreement and will be true as of
Closing:
4.1 CORPORATE ORGANIZATION; ETC. Buyer is a corporation duly
organized, validly existing and in good standing under the laws of the
State of Mississippi and has full corporate power and authority to carry on
its business as now being conducted.
4.2 AUTHORIZATION OF AGREEMENT. The execution, delivery and
performance of this Agreement has been duly authorized by all necessary
corporate action by Buyer and constitutes the legal, valid and binding
obligation of Buyer, enforceable in accordance with its terms.
4.3 NO VIOLATION. Neither the execution and delivery of this
Agreement, nor the performance by Buyer of its obligations hereunder nor
the consummation of the transactions contemplated hereby will (a) violate,
be in conflict with, constitute a default under, permit the termination of,
or cause the acceleration of the maturity of any debt or obligation of
Buyer
<PAGE>
which violation, conflict, default, termination or acceleration
individually or in the aggregate with all such other violations, conflicts,
defaults, terminations and accelerations would have a material adverse
effect on Buyer; (b) except as set forth in EXHIBIT 4.3 (NO CONSENT OR
VIOLATION), require the consent of any other person to, constitute a breach
of any agreement or commitment to which Buyer is a party or by which it or
any of its property is bound (which individually or in the aggregate with
all other such breaches would have a material adverse effect on Buyer); (c)
result in the creation or imposition of any lien upon any of Buyer's assets
under any agreement or commitment to which Buyer is party or by which it is
bound which would have a material adverse effect upon Buyer; or (d)
violate any statute or law or any judgment, decree, order, regulation or
rule of any court or governmental authority to which Buyer is subject.
4.4 LITIGATION OR PROCEEDING. There is no suit, claim, action or
investigation pending or, to the best knowledge of Seller, threatened by or
against Seller affecting the Assets, before any federal, state, municipal
or other governmental court, department, commission, board, bureau, agency
or instrumentality wherever located, which possibly could prevent the
consummation of the transactions contemplated by this Agreement or
adversely affect Buyer's enjoyment of or diminish the value of the Assets.
4.5 CONSENTS AND APPROVALS OF GOVERNMENTAL AUTHORITIES. Buyer has
obtained, or prior to Closing will obtain, all consents, approvals or
authorizations of, or declarations, filings or registrations with, all
governmental or regulatory authorities or other persons required to be made
or obtained by Buyer in connection with the execution, delivery and
performance of this Agreements.
4.6 FINANCIAL STATEMENTS. Pro forma Financial Statements for the
current year reflecting the financial condition of Buyer, including,
without limitation, the balance sheet of Buyer (collectively, the "BUYER'S
FINANCIAL STATEMENTS"), have been prepared in accordance with general
accepted accounting principles consistently applied except as disclosed in
the accountant's statement contained therein. A copy of which is attached
hereto as EXHIBIT 4.6.
4.7 INSPECTION. Buyer has made an independent investigation, to the
extent Buyer deems necessary or appropriate, concerning the physical
condition, value, development, use, marketability, feasibility and
suitability of the Project, including, without limitation, land use, zoning
and other governmental restrictions.
4.8 ACQUISITION FOR INVESTMENT PURPOSES. Buyer has such knowledge
and experience in financial and business matters that it is capable of
evaluation of the merits and risks associated with this Transaction and
the Shares. Buyer is acquiring the Shares in a private transaction,
solely for its own account for the purpose of investment and not as a
nominee or agent for any other person and not with a view to, or for offer
or sale in connection with, any distribution of any Shares (other than in
a transaction which is either registered under the Securities Act or
exempt from such registration, and in compliance with
<PAGE>
all applicable Blue
Sky or state securities laws or exempt therefrom). Buyer agrees and
acknowledges that it will not, directly or indirectly, offer, transfer,
sell, assign, pledge, hypothecate or otherwise dispose of (hereinafter,
"Transfer") any of the Shares unless such Transfer is either (i) pursuant
to an effective registration statement under the Securities Act and
qualification or other compliance under applicable Blue Sky or state
securities laws, or (ii) exempt from registration under the Securities Act
and applicable Blue Sky or state securities laws.
4.9 NO OTHER SELLER REPRESENTATIONS. Except as expressly set forth
herein, Buyer acknowledges that no representations or warranties, express
or implied, have been made by Seller or Seller's representatives.
4.10 "AS IS, WHERE IS". BUYER HEREBY EXPRESSLY ACKNOWLEDGES THAT IT
HAS INSPECTED AND EXAMINED OR WILL INSPECT AND EXAMINE THE ASSETS TO THE
EXTENT DEEMED NECESSARY BY BUYER IN ORDER TO ENABLE BUYER TO EVALUATE THE
PURCHASE OF THE ASSETS. BUYER REPRESENTS THAT IT IS A KNOWLEDGEABLE BUYER
OF CATFISH FARMS INCLUDING RELATED IMPROVEMENTS, EQUIPMENT AND FACILITIES
AND THAT, EXCEPT AS SET FORTH IN ARTICLE 3, IT IS RELYING SOLELY ON ITS
OWN EXPERTISE AND THAT OF BUYER'S CONSULTANTS, AND THAT BUYER HAS
CONDUCTED OR WILL CONDUCT SUCH INSPECTIONS AND INVESTIGATIONS OF THE
ASSETS AS BUYER IN ITS SOLE DISCRETION DEEMS NECESSARY OR APPROPRIATE,
INCLUDING, BUT NOT LIMITED TO, THE PHYSICAL AND ENVIRONMENTAL CONDITIONS
THEREOF. BUYER FURTHER ACKNOWLEDGES AND AGREES THAT BUYER IS ACQUIRING
THE ASSETS ON AN "AS IS, WHERE IS" BASIS WITHOUT REPRESENTATIONS OR
WARRANTIES OTHER THAN THOSE SET FORTH HEREIN AND IN THE DOCUMENTS OF
TRANSFER RELATING TO THIS TRANSACTION.
ARTICLE 5
COVENANTS OF SELLER
Seller hereby covenants and agrees as follows:
5.1 OPERATIONS OF SELLER. At all times prior to Closing, Seller
shall (i) maintain the Assets in good repair and working order for the
efficient operation and management of the Assets, (ii) enter into no
contract or other transaction affecting the Assets other than in the
ordinary course of business without the prior written consent of Buyer,
(iii) perform when due all of Seller's obligations and other agreements
relating to the Assets in accordance with applicable agreements, laws,
ordinances, rules and regulations. None of the Assets shall be
permanently removed from Seller's principal place of business, unless
replaced by personal property or fixtures of equal or greater utility and
value. Seller shall use commercially reasonable efforts to liquidate its
entire fish inventory to third parties prior to thirty (30) months after
the Effective Date in such a manner as Seller determines in its sole and
absolute
<PAGE>
discretion. Seller may at any time and from time to time
relocate its fish inventory to any ponds located on the Real Property
which are not then subject to a Lease with Buyer.
5.2 CHANGE IN CONDITION. Seller shall promptly notify Buyer of any
change in any condition with respect to the Assets or of any event or
circumstance which makes any representation or warranty of Seller to Buyer
under this Agreement untrue or misleading in any material respect, or any
covenant of Seller under this Agreement incapable or less likely of being
performed, it being understood that Seller's obligation to provide notice
to Buyer under this Section 5.2 shall in no way relieve Seller of any
obligations with respect to its representations, warranties or covenants
under this Agreement.
5.3 INSURANCE. The existing insurance policies relating to Seller
shall remain continuously in force through the day of Closing.
5.4 PAYMENT OF LIABILITIES. Seller has paid or will pay in the
ordinary course of business and in accordance with past practice all bills
and invoices for labor, goods, material and services of any kind relating
to the Business or the Assets, utility charges, and employee salary and
other accrued benefits relating to the period prior to Closing. Seller
reserves the right to contest any such liabilities or obligations in good
faith.
5.5 NOTIFICATION OF SUBSEQUENT EVENTS. Prior to Closing, Seller
shall notify Buyer of any written notice received by Seller of any
material adverse change in or to the Assets including, without limitation,
any notice relating to any insurance contract or policy now held or owned
by Seller to cancel or materially increase any premiums relating thereto.
5.6 ENVIRONMENTAL STUDY. Seller will reasonably assist and
cooperate with any environmental evaluation, study or audit of the
Purchased Assets, prepared by, for or at the request of Buyer, at no cost
to Seller.
5.7 POST CLOSING TRANSACTIONS. For a period of 180 days following
Closing, Seller shall not dividend or distribute to Seller's shareholder
the proceeds hereof. The foregoing shall not restrict Seller in any
manner from paying any and all of its contractual liabilities or
obligations in full immediately at or after Closing, including any and all
liabilities and indebtedness to Delta Industries, Inc., an affiliates of
Seller. In addition, The foregoing shall not restrict Seller in any
manner from conveying and/or distributing any of the Excluded Assets at
any time and in any manner, for or without value.
5.8 REPRESENTATIONS AND WARRANTIES. Seller will not take any action
and will not permit any action to be taken which would cause any of their
representations and warranties set forth herein to be untrue as if such
warranties and representations were made on and as of the Closing Date.
<PAGE>
5.9 ALIENATION OF ASSETS. Seller will not enter into or conduct any
discussions with prospective Buyers of the Assets or sell, lease, subject
to liens, encumber or otherwise transfer any interest in any of the Assets
(except for retirements and replacements in the ordinary course of
business, provided that all items which are retired or replaced are
contemporaneously replaced by items of substantially equivalent or greater
value).
5.10 MORTGAGES. Seller will not create or incur, or acquiesce in the
creation, incurrence or existence of, any new mortgage, deed to secure
debt, deed of trust, lien, pledge, charge, security interest or other
encumbrance which affects the Assets.
5.11 EMPLOYEES. Buyer intends to offer employment to certain of
those persons employed by Seller relating to the Business immediately
after the Closing, contingent to the extent permitted by law, upon
successful completion after Closing of Buyer's drug, alcohol and other
standard testing procedures. Seller shall terminate all of its employees
who are employed in connection with the Business and shall fully satisfy
any and all liabilities or obligations due and payable to its employees,
including, without limitation, sick leave, severance, ERISA Plans or other
accrued benefits which Seller may owe to its employees as a result of such
termination. Seller further agrees to satisfy or cause its insurance
carriers to satisfy all claims for benefits, whether insured or otherwise
(including, without limitation, workers' compensation, life insurance,
medical and disability programs), relating to Seller's employees, which
claims arise out of events occurring prior to the Closing Date. Seller
reserves the right to contest any such liabilities or obligations in good
faith.
ARTICLE 6
COVENANTS OF BUYER
Buyer hereby covenants and agrees as follows:
6.1 AFFECTED EMPLOYEES. "AFFECTED EMPLOYEES" shall mean all
employees of Seller who are subsequently employed by Buyer immediately
after the Closing. Buyer intends to offer employment to a significant
number of persons currently employed by Seller in connection with the
Business on the Closing Date. Seller and Buyer acknowledge and agree that
all employees of Seller shall be terminated as of the Closing Date and
that Buyer intends to hire a portion of the employees promptly after
Closing. Buyer shall have the sole and exclusive right and obligation as
the owner and operator of the Business to make all such hiring decisions.
Notwithstanding anything contained herein to the contrary, Delta
Industries, Inc. or its affiliates ("Delta") shall have the right to hire
any employees of the Company to whom it elects to offer employment;
provided, however, Delta shall not hire the following specific individuals
for a period of one year after Closing: James Shires and Sammy Luke.
6.2 FINANCIAL STATEMENTS. Buyer shall deliver to Seller Buyer's
Financial Statements.
<PAGE>
ARTICLE 7
CONDITIONS TO BUYER'S OBLIGATION TO CLOSE
Buyer's obligation to close shall be subject to the satisfaction of
the following conditions at or prior to Closing unless waived by Buyer:
7.1 REPRESENTATIONS AND WARRANTIES TRUE AT CLOSING. Seller shall
deliver to Buyer at Closing a certificate of Seller to the effect that all
representations and warranties set forth herein are true and correct in
all material respects as of the date of Closing, that all covenants of
Seller set forth herein have been duly performed in all material respects,
and that all conditions to the obligations of Seller set forth in Article
8 have been satisfied as of the Closing, in the form attached hereto as
EXHIBIT 7.1 (SELLER'S CLOSING CERTIFICATE).
7.2 COMPLIANCE WITH AGREEMENT. Seller shall have performed and
complied in all material respects with all their obligations under this
Agreement which are to be performed or complied with prior to or at the
Closing.
7.3 NO ADVERSE CHANGE. The Assets shall not have been adversely
affected in any material manner such as would prohibit their use as a fish
farm.
7.4 LITIGATION. No litigation or other proceeding shall have been
commenced or threatened against Buyer or Seller which, in the opinion of
Buyer, would adversely affect its enjoyment of the Assets or the ability
of any party to close the transactions contemplated hereby.
7.5 OPINION OF COUNSEL. Buyer shall have received an opinion, dated
the date of the Closing, addressed to Buyer from counsel to Seller,
containing the opinions set forth in EXHIBIT 7.5.
7.6 EVIDENCE OF AUTHORITY. Buyer shall have received evidence of
existence, organization and authority of Seller (including shareholder
approval) reasonably satisfactory to Buyer and its counsel, including,
without limitation an Officer's Certificate and Incumbency Certificate in
the form attached hereto as EXHIBIT 7.6 (SELLER OFFICER'S CERTIFICATE).
7.7 CLOSING DOCUMENTS. Seller shall have delivered to Buyer (a) such
endorsements, assignments, undertakings and other good and sufficient
instruments of transfer, in form and substance satisfactory to Buyer and
its counsel, as shall be necessary to vest good and marketable title to the
Assets in Buyer, including, without limitation, the original certificates
evidencing the Shares duly endorsed for transfer to Buyer, Warranty Deed,
Special Warranty Bill of Sale and Assignment and Assumption Agreements each
in the form attached hereto as EXHIBIT 7.7 (CONVEYANCE DOCUMENTS), (b)
copies of all of Seller's Contracts being assigned to Buyer, if any, and
(c) such other documents as may be necessary to put Buyer in
<PAGE>
actual
possession and operating control of the Assets. Seller shall make the
originals of all such documents available to Buyer for inspection during
reasonable business hours upon reasonable prior notice.
7.8 POSSESSION OF ASSETS. Subject to the Permitted Exceptions, Buyer
shall have full and unrestricted right to possession of the Assets at
Closing, and Seller shall deliver possession of the Assets to Buyer.
ARTICLE 8
CONDITIONS TO SELLER'S OBLIGATIONS TO CLOSE
Seller's obligation to close shall be subject to the satisfaction of
the following conditions at or prior to Closing unless waived by Seller:
8.1 SHAREHOLDER APPROVAL. Seller shall have received unconditional
approval of the transactions contemplated hereby from its shareholders and
further provided that less than one percent (1%) of Seller's shareholders
exercise their rights to dissent to the transaction and receive fair value
for their shares pursuant to Article 13 of the Mississippi Business
Corporation Act.
8.2 PAYMENT OF PURCHASE PRICE. Buyer shall have paid the Purchase
Price at Closing as provided in Section 1.3 hereof.
8.3 REPRESENTATIONS AND WARRANTIES TRUE AT CLOSING. Buyer shall
deliver to Seller at Closing a certificate of Buyer to the effect that all
representations and warranties set forth herein are true and correct in all
material respects as of the date of Closing, that all covenants of Buyer
set forth herein have been duly performed in all material respects, and
that all conditions to the obligations of Buyer set forth in Article 7 have
been satisfied as of the Closing, in the form attached hereto as EXHIBIT
8.3 (BUYER'S CLOSING CERTIFICATE).
8.4 COMPLIANCE WITH AGREEMENT. Buyer shall have performed and
complied with all its obligations under this Agreement in all material
respects which are to be performed or complied with by it prior to or at
the Closing.
8.5 LITIGATION. No litigation or other proceeding shall have been
commenced or threatened against Seller or Buyer which, in the opinion of
Seller, would adversely affect Seller's ability to consummate the
transaction contemplated hereby.
8.6 OPINION OF COUNSEL. Seller shall have received an opinion, dated
the date of the Closing, addressed to Seller from counsel to Buyer,
containing the opinions set forth in EXHIBIT 8.6.
<PAGE>
8.7 EVIDENCE OF AUTHORITY. Seller shall have received evidence of
existence, organization and authority of Buyer reasonably satisfactory to
Seller and their counsel, including, without limitation an Officer's
Certificate and Incumbency Certificate in the form attached hereto as
EXHIBIT 8.7 (BUYER'S OFFICER'S CERTIFICATE).
8.8 INSTRUMENTS RELATING TO THE SELLER FINANCING AND TRANSFER. Buyer
shall have delivered to Seller (a) such instruments of transfer, including,
without limitation, (a) Assignment and Assumption Agreement(s) in the form
attached hereto; (b) the Note and related Security Documents, in a form
acceptable to Seller; and (c) such other documents as may be reasonably
necessary to close the transactions contemplated hereby.
8.9 BUYER'S FINANCIAL STATEMENTS. Seller shall have received prior
to Closing updated Buyer's Financial Statements which shall reflect a net
worth of not less than $300,000.00 for Buyer.
ARTICLE 9
CLOSING; TERMINATION; POST CLOSING
9.1 CLOSING. Seller shall designate the Closing Date by providing
written notice to Buyer that Seller has completed the liquidation of its
inventory and that Seller is prepared to deliver possession of all of the
Real Property to Buyer ("CLOSING NOTICE"), which shall be effective upon
Buyer's receipt thereof ("CLOSING NOTICE DATE"). The Closing shall take
place at the offices of the Forman, Perry, Watkins, Krutz & Tardy, PLLC on
such date and at such time as may be fixed by mutual agreement of the
parties, but no event later thirty (30) days after the Closing Notice Date
("CLOSING" or "CLOSING DATE"). In no event shall the Closing Notice,
Closing Notice Date or the Closing Date occur later than December 31, 2002.
9.2 TERMINATION. At any time before the Closing, this Agreement may
be terminated (i) by mutual consent of the parties, (ii) by Buyer if there
has been a material misrepresentation, material breach of warranty or
material breach of covenant by Seller, (iii) by Seller if there have been a
material misrepresentation, material breach of warranty or material breach
of covenant by Buyer, (iv) by Buyer if any condition set forth in Article 7
has not been satisfied at or before the Closing or (v) by Seller if any
condition set forth in Article 8 has not been satisfied at or before the
Closing.
9.3 BREACH BY BUYER. IF BUYER DEFAULTS UNDER ANY PROVISION OF THIS
AGREEMENT AND CLOSING DOES NOT OCCUR, THEN SELLER SHALL BE RELEASED FROM
ALL OBLIGATIONS AT LAW OR IN EQUITY TO CONVEY THE ASSETS TO BUYER. BUYER
AND SELLER AGREE THAT AS SELLER'S SOLE REMEDY FOR A DEFAULT HEREUNDER, BY
WRITTEN NOTICE TO BUYER, SELLER SHALL BE ENTITLED TO TERMINATE THIS
AGREEMENT AND BE ENTITLED TO RECEIVE THE ESCROW DEPOSIT PLUS ACCRUED
INTEREST THEREON AS LIQUIDATED DAMAGES. BUYER AND SELLER ACKNOWLEDGE
<PAGE>
AND
AGREE THAT ACTUAL DAMAGES WILL BE EXTREMELY DIFFICULT AND IMPRACTICAL TO
ASCERTAIN. THEREFORE, THE SUM REPRESENTED ABOVE SHALL BE DEEMED TO
CONSTITUTE A REASONABLE ESTIMATE AND AGREED STIPULATION OF SELLER'S DAMAGES
AND SHALL CONSTITUTE SELLER'S SOLE AND EXCLUSIVE REMEDY IN THE EVENT THIS
TRANSACTION FAILS TO CLOSE AS A RESULT OF BUYER'S DEFAULT.
NOTWITHSTANDING THE FOREGOING, BUYER'S LIABILITY UNDER SECTION 7.1 HEREOF
SHALL BE UNAFFECTED AND SHALL REMAIN IN FULL FORCE AND EFFECT.
9.4 BREACH BY SELLER. IN THE EVENT THAT SELLER FAILS TO PERFORM ALL
OF SELLER'S OBLIGATIONS UNDER THIS AGREEMENT AND BUYER PERFORMS ALL OF ITS
OBLIGATIONS OR TENDERS PERFORMANCE, INCLUDING THE OBLIGATION TO CONSUMMATE
THE TRANSACTION, THEN BUYER MAY MAKE WRITTEN DEMAND TO SELLER FOR
PERFORMANCE OF THIS AGREEMENT. IF SELLER FAILS TO COMPLY WITH BUYER'S
WRITTEN DEMAND WITHIN 10 DAYS AFTER RECEIPT OF SUCH WRITTEN DEMAND FOR
PERFORMANCE, BUYER SHALL HAVE THE EXCLUSIVE RIGHT TO (I) WAIVE SUCH
DEFAULT, (II) SEEK SPECIFIC PERFORMANCE OF SELLER'S OBLIGATIONS UNDER THIS
AGREEMENT, OR (III) TERMINATE THIS AGREEMENT AND BE ENTITLED TO A REFUND OF
THE ESCROW DEPOSIT PLUS ALL ACCRUED INTEREST THEREON AND PAYMENT BY SELLER
OF AN AMOUNT NOT TO EXCEED $30,000 IN ORDER TO REIMBURSE BUYER'S ACTUAL OUT
OF POCKET EXPENSES ASSOCIATED WITH THIS TRANSACTION, BUT WITHOUT FURTHER
LIABILITY ON SELLER'S PART. SELLER AGREES THAT THE PROJECT IS UNIQUE AND
THAT DAMAGES FOR FAILURE BY SELLER TO CONSUMMATE THE TRANSACTION WILL BE
IMPRACTICABLE AND EXTREMELY DIFFICULT TO DETERMINE. THEREFORE, IN THE
EVENT THAT SELLER FAILS OR REFUSES TO CONSUMMATE THE TRANSACTION AND BUYER
SEEKS SPECIFIC PERFORMANCE, SELLER SPECIFICALLY AGREES THAT THE REMEDY OF
SPECIFIC PERFORMANCE IS AN APPROPRIATE REMEDY FOR BUYER, AND SELLER WAIVES
AND AGREES NOT TO ASSERT ANY CLAIM OR DEFENSE THAT SPECIFIC PERFORMANCE IS
NOT AN APPROPRIATE REMEDY FOR BUYER.
9.5 KNOWLEDGE AS A DEFENSE. Seller shall have no liability with
respect to a breach of the covenants, representations and warranties of
Seller set forth in this Agreement or any documents delivered pursuant
hereto to the extent that Buyer proceeds with the Closing of the
transaction contemplated with actual knowledge of any such breach or such
breach was otherwise disclosed or known to Buyer at or prior to Closing.
9.6 POST-CLOSING DELIVERIES. After the Closing, each party to this
Agreement shall, at the request of the other, furnish, execute and deliver
such documents, instruments, certificates, notices or other further
assurances as the requesting party shall reasonably request
<PAGE>
as necessary or
desirable to effect complete consummation of this Agreement and the
transactions contemplated hereby.
ARTICLE 10
RISK OF LOSS
10.1 RISK OF LOSS. The risk of loss or damage to the Assets by fire,
or other casualty, or condemnation, prior to Closing, is assumed by Seller.
Seller shall maintain in full force and effect all insurance policies
currently covering the Assets until Closing. In the event that, prior to
Closing, the Assets, or any substantial part thereof, are destroyed or
materially damaged, Seller must deliver to Buyer written notice of such
event within ten (10) days of Seller's learning of such events, and Buyer
shall have the right, exercisable by giving notice of such decision to
Seller within fifteen (15) days after receiving notice of such damage or
destruction, to terminate this Agreement and receive a full refund of the
Escrow Deposit, in which case, except as expressly provided herein, neither
party shall have any further rights or obligations hereunder. If Buyer
elects to accept the Assets in their then condition, all proceeds of
insurance awards payable to Seller by reason of such damage or destruction
shall be paid or assigned to Buyer and Buyer shall receive a credit in the
amount of the deductible under Seller's insurance policy. In the event of
non-material (less than $50,000) damage to the Assets, which damage Seller
is unwilling to repair or replace, Buyer shall have to accept the Assets in
their then condition and proceed to close without any reduction to the
Purchase Price. It being the understanding of the parties that Seller
shall have no obligation to conduct any repair or replacement of a capital
nature.
ARTICLE 11
MISCELLANEOUS
11.1 CONSENTS. Seller and Buyer shall each promptly file or submit
and diligently pursue any and all applications or notices with federal,
state, local and/or regulatory authorities and all other requests with any
private persons or entities for consents, approvals, authorizations and
permissions which are reasonably considered necessary or appropriate by the
other party for the consummation of the transaction or to prevent the
termination of any rights material to the Assets.
11.2 CONTESTED ASSIGNMENT. Anything contained herein to the contrary
notwithstanding, this Agreement shall not constitute an agreement to assign
any claim, right, contract, license, lease or commitment if an attempted
assignment thereof without the consent of another party thereto would
constitute a breach thereof or in any material way affect the rights of
Seller thereunder. An attempted assignment would be ineffective or would
materially affect Seller's rights thereunder so that Buyer would not in
fact receive all such rights. Seller shall cooperate in any reasonable
arrangement designed to provide for Buyer the benefits under any such
claim, right, contract, license, lease or commitment, including, without
limitation,
<PAGE>
enforcement of any and all rights of Seller against the other
party or parties thereto arising out of the breach or cancellation by such
other party or otherwise.
11.3 LIMITED SURVIVAL PERIOD. All covenants, obligations,
representations, warranties and agreements contained in this Agreement
(excluding the warranties of title contained in the Conveyance Documents)
shall survive the Closing for a period of 180 days. The rights and
remedies of each party shall terminate at the expiration of the 180 day
time period stated above, unless written notice of a breach of any
applicable representation, warranty or covenant is delivered to the
breaching party within the stated 180 day time period and any legal action
or proceeding must be commenced within 240 days following the Closing or it
will be forever barred. Neither party has made any representation or
warranty to the other in connection with the transaction contemplated
herein except as contained in this Agreement and any other instrument,
agreement or writing provided for or contemplated by this Agreement.
11.4 SUCCESSORS OR ASSIGNS. Unless consented to by the other party,
no party shall assign or transfer their rights, obligations or liabilities
under this Agreement. Subject to the foregoing, this Agreement and the
terms and provisions hereof shall inure to the benefit of and be binding
upon the representatives, successors and assigns of the parties.
11.5 NO BENEFIT TO OTHERS. The representations, warranties, covenants
and agreements contained in this Agreement are for the sole benefit of the
parties hereto and their permitted successors and assigns, if any, and they
shall not be construed as conferring and are not intended to confer any
rights on any other persons or third parties.
11.6 ANNOUNCEMENTS. All public announcements regarding the purchase of
the Assets shall be subject to prior approval of Seller, except as
otherwise deemed necessary and required by legal counsel for either party
hereto. Buyer acknowledges that Seller is a public company and as such has
various disclosure and reporting obligations under applicable securities
laws, rules and regulations. Seller shall be the solely responsible for
its disclosure and such disclosure shall not require the prior approval or
consent of Buyer.
11.7 FURTHER ASSURANCES. The parties agree to take such further
action and execute such documents and instruments as may be reasonably
required in order to more effectively carry out the terms of this Agreement
and the intentions of the parties.
11.8 BROKER'S FEES. Seller and Buyer have not incurred any broker's
or finder's fees or retained or authorized any broker or finder to act on
their behalf in connection with the transactions contemplated hereby,
including, without limitation, the sale of the Assets contemplated
hereunder. Seller and Buyer represent to each other that they have acted
directly and independently with the other as principals and that neither
Seller nor Buyer have retained or authorized the services of any broker or
finder with respect to this transaction. Seller agrees to indemnify and
hold Buyer harmless from and against all claims, liabilities, and
<PAGE>
obligations for any commission, finder's fee, or other compensation in
connection with this Agreement claimed by or through Seller. Buyer agrees
to indemnify and hold Seller harmless from and against all claims,
liabilities, and obligations for any commission, finder's fee, or other
compensation in connection with this Agreement claimed by or through Buyer.
These mutual indemnifications shall survive Closing or termination of this
Agreement for any reason.
11.9 NOTICES. Any notice or other communication required or permitted
to be given hereunder shall be deemed to have been properly given when
delivered if by personal delivery or two days after deposit in the mail, if
mailed by certified mail, postage prepaid, addressed to the addresses of
the parties first referenced above (or to such other addresses as the
parties may specify by due notice to the others) with a copy to the legal
counsel of each party hereto.
11.10 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall for all purposes be deemed to be an
original and all of which together shall constitute one and the same
agreement binding on all the parties.
11.11 FACSIMILE SIGNATURES. In order to expedite the Transaction
contemplated herein, telecopied signatures may be used in place of original
signatures on this Agreement. All parties hereto intend to be bound by the
signatures on the telecopied document, are aware that other parties will
rely on the telecopied signatures, and hereby waive any and all defenses to
the enforcement of the terms of this Agreement based on the form of
signature.
11.12 HEADINGS. The headings in this Agreement are intended solely for
convenience or reference and shall be given no effect in the construction
or interpretation of this Agreement.
11.13 GOVERNING LAW. This Agreement shall be governed by the laws of
the State of Mississippi without regard to its conflict by laws provisions.
11.14 WAIVER OF JURY TRIAL. Each of the parties irrevocably waives any
right to a jury trial with respect to any matter arising out of or in
connection with this Agreement.
11.15 ARBITRATION.
a. All disputes between the parties submitted to arbitration shall
be resolved by binding arbitration administered by the American Arbitration
Association (the "AAA").
b. To the maximum extent practicable, the AAA, the arbitrator (or
the Arbitration Panel, as appropriate) and the parties shall take any
action necessary to require that an arbitration proceeding hereunder shall
be concluded within 180 days of the filing of the dispute with the AAA.
Unless the parties shall agree otherwise, arbitration proceedings hereunder
shall be conducted in Jackson, Mississippi. Arbitrators shall be empowered
to impose sanctions, permit or order depositions and discovery and to take
such other actions as they
<PAGE>
deem necessary to the same extent a judge could pursuant to the Federal
Rules of Civil Procedure and applicable law. With respect to any dispute,
each party agrees that all discovery activities shall be expressly limited
to matters directly relevant to the dispute and any arbitrator, Arbitration
Panel and the AAA shall be required to fully enforce this requirement.
11.16 ATTORNEYS' FEES. Should either party hereto institute any action
or proceeding in any court to enforce any provision of this Agreement, the
prevailing party shall be entitled to receive from the losing party
reasonable attorneys' fees and costs incurred in such action or proceeding,
or appeal thereof, whether or not such action or proceeding is prosecuted
to judgment.
11.17 COMPUTATION OF TIME PERIODS. All periods of the time referred to
in this Agreement shall include all Saturdays, Sundays and state or
national holidays, unless the period of time specifies business days,
provided that if the date or last date to perform any act or give any
notice or approval shall fall on a Saturday, Sunday or state or national
holiday, such act or notice may be timely performed or given on the next
succeeding day which is not a Saturday, Sunday or state or national
holiday.
11.18 TIME OF THE ESSENCE. Time is of the essence with respect to of
all matters set forth in this Agreement.
11.19 NO WAIVER. No waiver by either party of any breach by the other
of any provision of this Agreement shall be deemed or construed to be a
waiver of any subsequent or continuing breach of the same or any other
provision of this Agreement; nor shall any forbearance by either party from
the exercise of a remedy for any such breach be deemed or construed to be a
waiver by such party of any of its rights or remedies with respect to such
breach.
11.20 EXCLUSIVENESS. This Agreement together with the exhibits
attached hereto embodies all of the representations, warranties and
agreements of the parties hereto with respect to the subject matter hereof,
and all prior understandings, representations and warranties (whether oral
or written) with respect to such matters are superseded and may not be
amended, modified, waived, discharged or orally terminated except by an
instrument in writing signed by the party or an executive officer of a
corporate party against whom enforcement of the change, waiver, discharge
or termination is sought. The making, execution and delivery of this
Agreement by the parties hereto has been induced by no representation,
statements, warranties or agreements other than those expressed herein.
11.21 SEVERABILITY. The invalidity or unenforceability of any
particular provision of this Agreement shall not affect the other
provisions hereof, and this Agreement shall be construed in all respects as
if such invalid or unenforceable provisions were omitted. Furthermore, in
lieu of such illegal, invalid or unenforceable provision there shall be
added
<PAGE>
automatically as a part of this Agreement a provision as similar in terms
to such illegal, invalid or unenforceable provision as may be possible and
be legal, valid and enforceable.
11.22 INTERPRETATION, NO PRESUMPTION. It is acknowledged by the
parties that this Agreement has been reviewed and negotiated by attorneys
for all parties and, therefore, no presumptions shall arise favoring either
party by virtue of the authorship of any of its provisions.
11.23 EXHIBITS. The exhibits attached hereto, and all post execution
exhibits attached prior to Closing, are hereby incorporated into this
Agreement and wherever reference is made to them it shall be as if they
were set out in full at the point at which such reference is made.
11.24 CONFIDENTIALITY. Unless Seller otherwise agrees in writing,
Buyer agrees that all confidential proprietary information regarding the
Project of whatsoever nature made available to it by Seller or Seller's
agents or representatives or developed by Buyer ("CONFIDENTIAL
INFORMATION"), is confidential and shall not be disclosed to any other
person except those assisting Buyer with this Transaction, or Buyer's
lender, if any, or except as required by law. The provisions of the
foregoing sentence shall not apply to any information which is otherwise
available to the public or which has been obtained from sources that are
not subject to a similar confidentiality restriction or to disclosures as
required by law. Further, Buyer agrees not to use any Confidential
Information for any purpose other than to determine whether to proceed with
the Transaction contemplated by this Agreement. Upon Closing, all such
Confidential Information shall be the sole and exclusive property of Buyer
and not subject in any manner to this confidentiality restriction.
Provided, however, in the event the Transaction contemplated by this
Agreement does not close for any reason other than a breach by Seller, the
provisions of this Section 11.24 shall survive the termination of this
Agreement for a period of three (3) years.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date and year first above written.
BUYER:
H & S FISH FARMS, INC.
By: /S/ WALTER WILLIAM HEIGLE III
Name: Walter William Heigle III
Title: President
<PAGE>
SELLER:
FARM FISH, INC.
By: /S/ DAVE ROBISON
Name: Dave Robison
Title: Vice President
<PAGE>
EXHIBIT 1.1(A)-REAL AND PERSONAL PROPERTY SCHEDULE
The Assets include the following:
REAL PROPERTY. That certain real property, including fixtures,
buildings, improvements, and all appurtenant rights relating thereto owned
by Seller and described on Schedule 1.1(a) - Real Property attached hereto
(collectively, the "REAL PROPERTY").
PERSONAL PROPERTY. All machinery, equipment, vehicles, tools,
supplies, spare parts, furniture and all other personal property (other
than personal property leased pursuant to Contracts (as hereinafter
described) owned, utilized or held for use by Seller on the Closing Date
and listed on Schedule 1.1(a) - Personal Property attached hereto.
CONTRACTS. All the Seller's rights in, to and under all contracts,
leases, agreements, purchaser orders and sale orders of Seller described on
EXHIBIT 3.15(A) and approved by Buyer which relate directly to the Assets.
SHARES. The specific 1908 shares of Producer's Feed referenced on
Schedule 1.1(a) - Securities attached hereto.
<PAGE>
EXHIBIT 1.1(B) -EXCLUDED ASSETS
The Excluded Assets shall include the following:
CASH AND CASH EQUIVALENTS. All cash and cash equivalents.
RECEIVABLES. All accounts and notes receivable.
PERSONAL PROPERTY. All personal property of any type not specifically
included in the Assets to be conveyed to Buyer.
TRADE NAME. All rights to the name "Farm Fish" and all other trade
names used by Seller.
SECURITIES. All right and interest in all wholly owned subsidiaries of
Seller, including, without limitation, Dis, Inc. and Dat, Inc.
INSURANCE POLICIES. All existing insurance policies of Seller.
TAX CREDITS AND RECORDS. Federal, state and local income and
franchise tax credits and tax refund claims and associated returns and
records.
OTHER ASSETS. All other tangible and intangible assets of Seller, of
any type and wherever located, which are not specifically included in the
Assets to be conveyed to Buyer.
MISCELLANEOUS. Seller's existing litigation, employee benefit plans,
contracts with affiliates, books and corporate records.
<PAGE>
EXHIBIT 1.2 -LEASES
REAL PROPERTY AND EQUIPMENT LEASES
See attached.
<PAGE>
REAL PROPERTY LEASE AGREEMENT
This Real Property Lease Agreement (this "Lease") is made and entered
into as of the ___ day of July, 2000, by and between Farm Fish, Inc. a
Mississippi corporation (the "Landlord"), and H & S Fish Farms, Inc., a
Mississippi corporation (the "Tenant").
NOW, THEREFORE, in consideration of the mutual covenants set forth
herein, Landlord and Tenant intending to be legally bound hereby agree as
follows:
ARTICLE 1
PREMISES; TERM
1.1 PREMISES. Landlord hereby leases to Tenant and Tenant hereby
leases from Landlord for the rental and on the terms and conditions
contained herein that certain parcel of real property located in Humphreys
County, Mississippi (as more fully described on Exhibit 1 attached hereto)
together with all existing improvements thereon located at
_______________________________________ (collectively, the "Premises"),
such Premises being a portion of the assets described in that certain Asset
Purchase Agreement dated as of July ___, 2000, between Landlord and Tenant
(the "Purchase Agreement").
1.2 TERM. Subject to and upon the terms and conditions set forth
herein, this Lease shall be in force for a term of twenty (20) months
beginning on the date hereof (the "Commencement Date") and ending on the
31st day of March, 2002, unless sooner terminated pursuant to the
provisions hereof (the "Term").
ARTICLE 2
RENT; PAYMENT
2.1 RENT. Tenant agrees to pay to Landlord as base rent of $100 per
month if Buyer's only use of the Premises is to undertake capital
improvements ("Base Rent"). Provided, however, the monthly Base Rent
payments with respect to a portion of the Premises will increase as follows
if Buyer's use of any portion of the Premises is to operate, stock or grow
fish in any manner (collectively, "fish operations") based on a six percent
(6 %) interest factor on the mutually agreed upon allocated portion of the
Purchase Price applicable to such portions of the Premises used for fish
operations. "Additional Rent" shall consist of any and all payment
obligations or other liabilities of Tenant under this Lease, other than
Base Rent.
2.2 PAYMENT OF RENT. On or before the tenth (10{th}) day of each
calendar month during the Term, Tenant shall pay to Landlord for such month
one-twelfth (1/12) of the annual Base Rent, plus any Additional Rent then
due and payable (collectively, the "Rent"). All payments of Rent shall be
paid to Landlord in lawful money of the United States of America at the
address of Landlord shown herein or to such other party or at such other
place as Landlord may designate from time to time by written notice to
Tenant. If this Lease commences or terminates on any day other than the
first or last day of a calendar month, the Rent due hereunder shall be
prorated except as otherwise provided in this Lease.
<PAGE>
2.3 LATE PAYMENT. In the event that Landlord does not receive rental
payments by the tenth (10th) day of each month, Tenant shall pay, in
addition to any interest which may be due under Section 12.3, a late charge
equal to four percent (4%) of the Rent then due and payable. Tenant
acknowledges and agrees that this late payment charge is intended to
compensate Landlord for administrative and other expenses which it may
incur in connection with collection of any past due rental payments and is
not intended and shall not be deemed to constitute interest, a penalty or
as limiting Landlord's remedies in any manner.
2.4 UTILITIES. If Tenant requires utility service on the Premises,
Tenant shall provide such utilities at its sole cost. Tenant shall also
pay for all water, gas, heat, light, power, telephone, sewer, and other
utilities and services used on or for the benefit of the Premises, together
with any taxes, penalties, surcharges or the like, pertaining thereto and
maintenance charges for utilities. Tenant shall have the obligation to pay
all installation, deposits or similar charges with respect to any such
utilities. Landlord shall in no event be liable for any interruption or
failure of utility services on or for the benefit of the Premises.
Landlord shall not be required to furnish any services or utilities to the
Premises and Landlord shall have no duty or obligation to make any
alteration, change, improvement or replacement to the Improvements now or
hereafter erected. Tenant assumes the full and sole responsibility for
obtaining all services and utilities necessary for the operation of the
Premises.
2.5 NET LEASE. This is an absolutely net lease and the Rent shall be
paid without notice, demand, set-off, counterclaim, recoupment, abatement,
suspension, deferment, diminution, deduction, reduction or defense.
2.6 NON-TERMINABILITY. Except as otherwise expressly provided in
this Lease, (i) this Lease shall not terminate, (ii) Tenant shall not have
any right to terminate this Lease during the Term, (iii) Tenant shall not
be entitled to any set-off, counterclaim, recoupment, abatement,
suspension, deferment, diminution, deduction, reduction or defense of or to
Rent or any other sums payable under this Lease, and (iv) the obligations
of Tenant under this Lease shall not be affected by any interference with
Tenant's use of any of the Premises for any reason, including, without
limitation, the following: (A) any damage to, or theft, loss or destruction
of any of the Premises by any cause whatsoever, (B) the prohibition,
limitation or restriction of Tenant's use of any of the Premises, (C) any
eviction by paramount title or otherwise, (D) any default on the part of
Landlord under any other agreement, (E) any latent or other defect in any
of the Premises, (F) the breach of any warranty of any seller or
manufacturer of any of the equipment located on the Premises, (G) any
violation of Section 5.7, (H) any interference with Tenant's use of the
Premises, (I) market or economic changes or (J) any other cause, whether
similar or dissimilar to the foregoing, any present or future legal
requirement to the contrary notwithstanding. It is the intention of the
parties hereto that the obligations of Tenant hereunder shall be separate
and independent covenants and agreements, that Rent shall continue to be
payable in all events, and that the obligations of Tenant hereunder shall
continue unaffected, unless the requirement to pay or perform the same
shall have been terminated pursuant to an express provision of this Lease.
2.7 NO WARRANTY DISCLAIMER. TENANT ACKNOWLEDGES THAT THE PREMISES
ARE IN GOOD CONDITION AND REPAIR ON THE COMMENCEMENT DATE. LANDLORD HAS
NOT MADE AND WILL NOT MAKE ANY INSPECTION OF ANY OF THE PREMISES AND
LANDLORD LEASES AND WILL LEASE AND TENANT TAKES
<PAGE>
AND WILL TAKE THE PREMISES "AS IS." TENANT ACKNOWLEDGES THAT LANDLORD
(WHETHER ACTING AS LANDLORD HEREUNDER OR IN ANY OTHER CAPACITY) HAS NOT
MADE AND WILL NOT MAKE, NOR SHALL LANDLORD BE DEEMED TO HAVE MADE, ANY
WARRANTY OR REPRESENTATION, EXPRESS OR IMPLIED, WITH RESPECT TO ANY OF THE
PREMISES, INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OR REPRESENTATION AS
TO (I) ITS FITNESS FOR USE OR PURPOSE, DESIGN OR CONDITION FOR ANY
PARTICULAR USE OF PURPOSE, (II) THE QUALITY OF THE MATERIAL OF WORKMANSHIP
THEREIN, (III) THE EXISTENCE OF ANY DEFECT, LATENT OR PATENT, STRUCTURAL OR
NON-STRUCTURAL (IV) VALUE, (V) COMPLIANCE WITH LAND USE, ZONING OR BUILDING
CODES, (VI) LOCATION, (VII) USE, (VIII) CONDITION INCLUDING, WITHOUT
LIMITATION, CONDITION OF ROOF OR FOUNDATION (IX) MERCHANTABILITY OR
HABITABILITY, (X) QUALITY, (XI) DESCRIPTION, (XII) DURABILITY, (XIII)
OPERATION OR PERFORMANCE THEREOF, OR (XIV) THE EXISTENCE OF ANY HAZARDOUS
MATERIALS, IT BEING AGREED THAT ALL RISKS INCIDENT THERETO ARE TO BE BORNE
BY TENANT. TENANT ACKNOWLEDGES THAT THE PREMISES HAVE BEEN INSPECTED BY
TENANT AND ARE SATISFACTORY AND ACCEPTABLE TO IT. IN THE EVENT OF ANY
DEFECT OR DEFICIENCY IN ANY OF THE PREMISES OF ANY NATURE, WHETHER PATENT
OR LATENT, LANDLORD SHALL NOT HAVE ANY RESPONSIBILITY OR LIABILITY WITH
RESPECT THERETO OR FOR ANY INCIDENTAL OR CONSEQUENTIAL DAMAGES (INCLUDING
STRICT LIABILITY IN TORT). THE PROVISION OF THIS SECTION 2.7 HAVE BEEN
NEGOTIATED AND ARE INTENDED TO BE A COMPLETE EXCLUSION AND NEGATION OF ANY
REPRESENTATIONS OR WARRANTIES BY LANDLORD, EXPRESS OR IMPLIED, WITH ANY
OTHER LEGAL REQUIREMENTS NOW OR HEREAFTER IN EFFECT OR OTHERWISE.
ARTICLE 3
ASSIGNMENT; SUBLETTING
3.1 LANDLORD ASSIGNMENT. Landlord shall have the right to transfer
and assign in whole or in part, by operation of law or otherwise, its
rights and obligations hereunder whenever Landlord, in its sole judgment,
deems it appropriate without any liability to Tenant and Tenant shall
attorn to any party to which Landlord transfers the Premises.
3.2 TENANT ASSIGNMENT AND SUBLETTING. Tenant shall not sublease the
Premises, or any portion thereof, or transfer possession or occupancy
thereof to any person, firm or corporation or transfer or assign this
Lease, or any obligation, right or privilege arising hereunder, without the
prior written consent of Landlord, which may be conditioned or withheld in
Landlord's sole discretion. Landlord's consent to any assignment or
sublease by Tenant shall not operate as a release of Tenant or a waiver of
the necessity for obtaining Landlord's consent in writing to any subsequent
assignment or sublease; nor shall the collection or acceptance of rent from
any such assignee, subtenant or occupant constitute a waiver or release of
Tenant of any covenant or obligation contained in this Lease. In the event
that Tenant defaults under this Lease in the payment of Rent, Tenant hereby
assigns to Landlord the rent due from any subtenant of Tenant and hereby
authorizes each such subtenant to pay said rent directly to Landlord.
ARTICLE 4
MAINTENANCE; SERVICES; TAXES
4.1 MAINTENANCE AND REPAIR. Tenant shall provide all maintenance and
repair of the Premises, including, without limitation and to the extent any
improvements are included within the Premises, parking, exterior,
foundation, roof and structural portions of the improvements and the
heating, cooling, plumbing, electrical, lighting and fire prevention and
control systems of the improvements, if any. Tenant, at its sole cost,
shall maintain and repair the Premises and otherwise keep the Premises in
good order and repair.
In the event Tenant fails to timely conduct any such maintenance or
repairs, Landlord shall have the right, but not the obligation to conduct
such maintenance or repairs. Any cost incurred plus reasonable profit and
overhead for Landlord's administration thereof (as set forth in Section
9.1) shall be immediately due and payable in full as Additional Rent
hereunder. Landlord shall not be required to maintain or make any repair
whether foreseen or unforeseen or to maintain any of the Premises in any
way, and Tenant hereby expressly waives the right to maintain or make
repairs at the expense of Landlord, which right may be provided for in any
legal requirement now or hereafter in effect.
4.2 TAXES ON PERSONALTY AND TENANT IMPROVEMENTS. Tenant shall before
interest, fines or penalties are due thereon pay all ad valorem, real and
personal property and similar taxes or special assessments levied upon or
applicable to the Premises and all equipment, fixtures, furniture, and
other property placed by Tenant in the Premises and all license, permits
and other fees or charges imposed on the business conducted by Tenant on
the Premises. Upon notice to Tenant, Landlord shall have the right to
collect one-twelfth (1/12) of the estimated real property tax on a monthly
basis as Additional Rent. If Landlord so elects, it shall use or make the
actual funds collected available for payment of the real property taxes as
and when such become due.
4.3 TENANT'S EQUIPMENT AND INSTALLATIONS. Tenant shall not install
within or attach to the Premises any fixtures, equipment, facilities or
make any other improvements to the Premises until the plans therefor have
been approved in writing by Landlord, such approval may not be unreasonably
withheld or delayed.
ARTICLE 5
POSSESSION, USE AND UPKEEP OF PREMISES
5.1 POSSESSION. During the Term, Tenant shall have the right to
occupy the Premises beginning on the Commencement Date. Tenant agrees that
any such occupancy shall be deemed to be under all the terms, covenants,
conditions and provisions of this Lease. Landlord represents that it is
the current owner of the fee interest in and to the Premises.
5.2 AUTHORIZED USE. Tenant shall have the right to occupy, use or
permit the use of the Premises for catfish farming or any other related
uses consistent with the nature of the Premises and the terms hereof.
5.3 ILLEGAL AND PROHIBITED USES. Tenant shall not use or permit any
other party to use all or any part of the Premises for any purpose not
related to the production of farm raised catfish.
<PAGE>
Tenant shall not do or permit anything to be done in or about the Premises
nor bring or keep or permit anything to be brought to or kept therein,
which is prohibited by or which will in any way conflict with any law,
statute, ordinance or governmental rule or regulation now in force or
hereafter enacted or promulgated, or cause a cancellation of any insurance
policy covering the Premises or any part thereof or any of its contents.
Tenant shall not cause, maintain or permit any nuisance in, on or about the
Premises or commit or suffer to be committed any waste to, in, on or about
the Premises.
5.4 ALTERATIONS AND ADDITIONS. Tenant shall not make any
improvements, alterations or additions to the Premises except with the
prior written consent of Landlord, which shall not be unreasonably withheld
or delayed. All improvements, alterations and additions to the Premises
shall be the property of the Landlord and shall not be removed by Tenant
either during or after the end of the Term without the express written
approval of Landlord. Tenant shall promptly pay any and all costs and
expenses relating in any manner to any improvements, alterations or
additions. Tenant shall not be entitled to any reimbursement or
compensation resulting from its payment of the cost of constructing all or
any portion of improvements or any alterations or additions thereto unless
otherwise expressly agreed to by Landlord in writing.
5.5 COMPLIANCE WITH LAWS AND OTHER REGULATIONS. Tenant shall, at its
sole cost and expense, promptly comply: (i) with all laws, statutes,
ordinances and governmental rules, regulations or requirements now in force
or which may hereafter be in force, including, without limitation, all
Environmental Laws (as defined in Section 10.4), (ii) with the requirements
of any board of fire underwriters or other similar body now or hereafter
constituted, and (iii) with any directive or occupancy certificate issued
pursuant to any law by any public officer or officers insofar as any relate
to or affect the condition, use or occupancy of the Premises.
5.6 LANDLORD'S ACCESS. Landlord shall have the right, at reasonable
times during normal operating hours (except at any time in the event of an
emergency) during the Term, to enter the Premises and to inspect the
condition thereof, to determine if Tenant is performing its obligations
under this Lease, and to perform the services or to make the repairs and
restoration that Landlord elects to perform under this Lease, to cure any
defaults of Tenant hereunder that Landlord elects to cure, and to remove
from the Premises any improvements thereto or property placed therein in
violation of this Lease.
5.7 LIENS. Tenant shall not permit any mechanics', materialmen's or
other liens, security interests, pledge, deed of trust or other
encumbrance, of any type (collectively "Liens") to be fixed or placed
against the Premises, and agrees immediately to promptly discharge any
Liens which are allegedly fixed or placed against the Premises. In all
events, any such Lien shall be discharged, at Tenant's sole cost, within
thirty (30) days of it being affixed or placed upon the Premises.
5.8 QUIET POSSESSION. Provided Tenant has performed all its
obligations under this Lease, including, without limitation, the payment of
Rent, Tenant shall peaceably and quietly hold and enjoy the Premises for
the Term, subject to the provisions and conditions set forth in this Lease.
<PAGE>
ARTICLE 6
INSURANCE; LIABILITY; INDEMNITY
6.1 PROPERTY INSURANCE. During the Term of this Lease, Tenant, at
its sole cost, shall obtain and maintain with insurance companies approved
Landlord, fire and extended coverage insurance insuring the Premises
against loss or damage from fire, flood, lightning, windstorm, explosion,
earthquake, boiler, machinery and such other risks usually included under
extended coverage policies, with such coverages, amounts, deductibles and
exclusions as shall be approved by Landlord. Such extended coverage
insurance shall insure the Premises, including, without limitation,
Tenant's goods, furniture, machinery, equipment, inventory or other
property placed in the Premises. Such insurance shall be in an amount at
least equal to the replacement value of all property covered and shall name
Landlord as an additional insured. A certificate of such insurance shall
be furnished to Landlord, and such policy shall provide that it may not be
altered or canceled without thirty (30) days prior notice to Landlord.
6.2 LIABILITY INSURANCE. During the Term of this Lease, Tenant, at
its sole cost, shall obtain and maintain with insurance companies approved
by Landlord, comprehensive general liability insurance, including property
damage, insuring Tenant, Landlord and Landlord's assignees, if any, against
losses, liability or claims for injury to persons or property occurring in
or about the Premises or arising out of the maintenance, use or occupancy
thereof by Tenant. The liability under such insurance shall not be less
than $1,500,000 for any one person injured and/or killed and not less than
$1,500,000 for any one accident and not less than $1,500,000 in the
aggregate, all such amounts to be increased if, in the reasonable judgment
of Landlord, any such increase is reasonably necessary for Landlord's
protection and consistent with industry practices and the location of the
Premises. In addition, Tenant shall maintain all necessary workmen's
compensation insurance required by law and such other insurance, including,
without limitation, business interruption insurance, in amounts and types
as Landlord may reasonably require. A certificate of such insurance shall
be furnished to Landlord, and such policy shall provide that it may not be
altered or cancelled without thirty (30) days prior notice to Landlord.
6.3 FIRE OR OTHER CASUALTY. If any portion of the Premises is
damaged or destroyed, in whole or in part, by fire or other casualty at any
time during the Term of this Lease, within thirty (30) days after any such
event Tenant shall commence, and diligently pursue necessary action to
restore or replace the damaged or destroyed portion to substantially the
same condition that existed immediately prior to such damage or
destruction. If such damage or destruction occurs, the Rent shall not be
abated in any manner and this Lease shall continue in full force and effect
in accordance with its terms. Tenant shall use its best efforts to replace
the damaged or destroyed portions of the Premises within one hundred twenty
(120) days of such damage, subject to delays arising from acts of God,
shortages of labor or materials, war, or other similar or dissimilar
conditions or events beyond the reasonable control of Tenant.
6.4 WAIVER OF CLAIMS. Notwithstanding any provision of this Lease to
the contrary, Tenant hereto releases and waives all claims, rights of
recovery, and causes of action that Tenant or any party claiming by,
through, or under Tenant by subrogation or otherwise may now or hereafter
have against Landlord or any of its directors, officers, partners,
employees, or agents for any loss or damage that may arise as a result of
or in connection with Tenant's use and occupancy of the Premises including,
without limitation, negligence of Landlord or its directors,
<PAGE>
officers, partners, employees, or agents. Landlord shall not be liable for
any damage of any kind or for any damage to property, death or injury to
persons from any cause whatsoever by reason of the use and occupancy of the
Premises by Tenant, unless caused solely by the willful misconduct or gross
negligence of Landlord. Landlord shall not be liable to Tenant for any
inconvenience or loss to Tenant in connection with any repair, maintenance,
damage, destruction, restoration, or replacement referred to in this Lease.
Landlord shall not be obligated to insure the Premises or any of Tenant's
improvements or any of Tenant's goods, furniture, machinery, equipment,
inventory or other property placed in or incorporated in the Premises, and
Landlord shall not be obligated to repair, maintain, restore, or replace or
otherwise be liable for any damage to or destruction of any of the
foregoing. Landlord shall reasonably cooperate with Tenant in connection
with Tenant's obligations hereunder.
6.5 INDEMNITY. Tenant shall indemnify and hold harmless Landlord and
Landlord's agents, directors, officers, partners, employees, invitees, and
contractors, from all claims, losses, costs, damages, or expenses
including, without limitation, attorneys' fees, for any and all injuries
to, including death of, any person or damage to any property resulting
from, or arising out of, Tenant's use and occupancy of the Premises unless
caused solely by the willful misconduct or gross negligence of Landlord.
The provisions of this Section 6.5 shall survive expiration or termination
of this Lease for any reason.
ARTICLE 7
CONDEMNATION
7.1 CONDEMNATION. If any portion of the Premises shall be taken as
a result of the exercise of the power of eminent domain, this Lease shall
terminate as of the date of the taking with respect to the portion of the
Premises taken. Landlord shall be entitled to any and all compensation,
damages, income, rent and awards with respect thereto, except for an award,
if any, specified by the condemning authority for any property that Tenant
has the right to remove from the affected portion of the Premises.
Landlord shall apply all monies received with respect to such taking to the
Rent due hereunder in reverse order of maturity. Any excess shall be
applied to other amounts owed by Tenant to Landlord pursuant to the
Purchase Agreement or related documents in reverse order of maturity.
ARTICLE 8
DEFAULT; REMEDIES
8.1 EVENT OF DEFAULT. The term "Event of Default" or "Default"
refers to the occurrence of any one or more of the following: (i) failure
of Tenant to pay, within five (5) days of the due date, any Rent or other
amount required to be paid under this Lease; or (ii) failure of Tenant
after thirty (30) days written notice from Landlord of Tenant's default in
the performance of any of Tenant's obligations, covenants or agreements
under this Lease, to do, observe, keep and perform with diligence and
continuity any of such obligations, covenants, or agreements (if such
failure cannot reasonably be cured within such thirty (30) day period, the
length of such period shall be extended for the period reasonably required
therefor if Tenant commences curing such failure within such thirty (30)
day period and continues the curing thereof with reasonable diligence and
continuity); (iii) substantial abandonment of the Premises for more than
thirty (30) days; (iv) any default under Purchase Agreement or that
certain Equipment Lease Agreement of
<PAGE>
even date herewith or related documents (as contemplated by the Purchase
Agreement); or (v) the adjudication of Tenant to be bankrupt; or (vi) the
filing by Tenant of a voluntary petition in bankruptcy, receivership, or
other related or similar proceedings; or (vii) the making by Tenant of a
general assignment for the benefit of its creditors; or (viii) the
appointment of a receiver of Tenant's interests in the Premises in any
action, suit or proceeding by or against Tenant's interest in the Premises
or by or against Tenant; or (ix) any other voluntary or involuntary
proceedings instituted by or against Tenant under any bankruptcy or similar
laws, unless the occurrence of any such involuntary receivership or
proceedings is cured by the same being dismissed or stayed within sixty
(60) days thereafter; or (x) the failure of Tenant to discharge any
judgment against Tenant in excess of $10,000, either singularly or in the
aggregate, within sixty (60) days after such judgment becomes final; or
(xi) the sale or attempted sale under execution or other legal process of
the interest of Tenant in the Premises.
8.2 REMEDIES UPON DEFAULT. If an Event of Default occurs, Landlord
at any time thereafter prior to the curing of such Event of Default and
without waiving any other rights herein available to Landlord at law or in
equity, may either terminate this Lease or terminate Tenant's right to
possession without terminating the Lease, whichever Landlord elects. In
either event, Landlord may, without additional notice and without court
proceedings, reenter and repossess the Premises, and remove all persons
and property therefrom using such force as may be necessary, and Tenant
hereby waives any claim arising by reason thereof or by reason of issuance
of any distress warrant and agrees to hold Landlord harmless from any such
claims. In no event shall Landlord's exercise of any one or more remedies
hereunder granted or otherwise available to it be deemed to be an
acceptance or surrender of the Premises by Tenant, whether by agreement or
operation of law, it being understood that such surrender can be affected
only by the written agreement of Landlord and Tenant. If Landlord elects
to terminate this Lease, it may treat the Event of Default as an entire
breach under this Lease and Tenant shall immediately become liable to
Landlord for damage for the entire breach in an amount equal to the amount
by which (a) the Rent (being the Base Rent and the Additional Rent)
exceeds (b) the fair market rental value of the Premises for the balance
of the Term as of the time of default, both discounted at the rate of six
percent (6%) per annum to the then present value, plus the cost of
recovering, remodeling and releasing the Premises, and all unpaid Rent due
through the date of such termination. It is the intent of Landlord and
Tenant that the foregoing constitutes an acceleration of all future Rent
payment obligations under this Lease. If Landlord elects to terminate
Tenant's right to possession of the Premise without terminating this
Lease, Landlord may rent the Premises or any part thereof for the account
of Tenant to any person or persons for such rent and for such terms and
other conditions as Landlord deems practical, and Tenant shall be liable
to Landlord for the amount, if any, by which the total Rent and other
payments herein provided for the unexpired balance of the Term exceed the
net amount, if any, received by Landlord from such re-renting. Such net
amount is the gross amount received by Landlord less the cost of
repossessing, re-renting, remodeling and other expenses incurred by
Landlord. Such amount shall be paid by Tenant in monthly installments on
the first day of each month of the Term. In no case shall Landlord be
liable for failure to re-rent the Premises or collect the rental due under
such re-renting and in no event shall Tenant be entitled to any excess
rents received by Landlord. If Landlord elects to terminate Tenant's
right to possession without terminating the Lease, Landlord shall have the
right at any time thereafter to terminate this Lease, whereupon the
foregoing provisions with respect to termination of the Lease will
thereafter apply to this Lease. The remedies expressed herein are
cumulative and not exclusive to any other rights and remedies Landlord may
have either at law
<PAGE>
or in equity, and the election by Landlord to terminate Tenant's right to
possession without terminating the Lease shall not deprive Landlord of the
right, and Landlord shall have the continuing right to terminate this
Lease. Landlord shall be entitled to pursue simultaneously multiple or
alternative remedies, at any time to abandon or resume pursuit of any
remedy, and at any time to pursue additional remedies.
8.3 DAMAGES. In the event Landlord elects to terminate Tenant's
right to possession without terminating this Lease, Tenant shall remain
liable for any Rent and damages which may be due or sustained by Landlord
and all reasonable cost, fees and expenses including, without limitation,
attorneys' fees, cost and expenses incurred by Landlord in pursuit of its
remedies.
8.4 NON-WAIVER. No consent or waiver, express or implied, by
Landlord to or of any breach in the performance or observance by Tenant of
any of its obligations under this Lease, including, without limitation,
any Event of Default, shall be construed as or constitute a consent or
waiver to or of any other breach in the performance or observance by
Tenant of such obligation or any other obligations of Tenant. Neither the
acceptance by Landlord of any Rent or other payment hereunder, whether or
not any default hereunder by Tenant is then known to Landlord, nor any
custom or practice followed in connection with this Lease shall constitute
a waiver of any of Tenant's obligations under this Lease. Failure by
Landlord to complain of any action or non-action on the part of Tenant or
to declare Tenant in default irrespective of how long such failure may
continue, shall not be deemed to be a waiver by Landlord of any of its
rights hereunder. Notwithstanding any provision of this Lease to the
contrary, all Rent and other amounts payable by Tenant under this Lease
shall be paid without abatement, offset, counterclaim or diminution to any
extent whatsoever. Except for the execution and delivery of a written
agreement expressly accepting surrender of the Premises, no act taken or
failed to be taken by Landlord shall be deemed an acceptance of surrender
of the Premises.
ARTICLE 9
FAILURE TO PERFORM
9.1 TENANTS FAILURE TO PERFORM. In the event Tenant fails to
perform any one or more of its obligations hereunder, in addition to the
other rights of Landlord hereunder, Landlord shall have the right, but not
the obligation, to perform all or any part of such obligations of Tenant.
Upon receipt of a demand therefor from Landlord, Tenant shall reimburse
Landlord for the cost to Landlord of performing such obligations, plus
interest at the rate set forth in Section 12.3.
9.2 LANDLORD'S FAILURE TO PERFORM. In the event Landlord fails to
perform any of its obligations under Sections 5.1 or 5.8 of this Lease, in
addition to the other rights of Tenant hereunder, Tenant shall have the
right to set off against the Rent due hereunder the cost and expense
directly relating to such breach by Landlord. Upon receipt of a demand
therefor from Tenant, Landlord shall use commercially reasonable efforts
to cure any such breach of Sections 5.1 or 5.8 of this Lease.
<PAGE>
ARTICLE 10
ENVIRONMENTAL MATTERS
10.1 USE OF HAZARDOUS MATERIALS. Tenant shall not cause or permit
any Hazardous Materials or raw materials which contain Hazardous Materials
to be stored, located, discharged, emitted, processed, generated, managed,
possessed or otherwise used or handled in or upon the Premises except in
strict compliance with all Environmental Laws affecting the Premises or
Tenant's use thereof. No Hazardous Materials shall be placed into the
plumbing or waste treatment systems of the Premises except for systems
which are designed to accept Hazardous Materials for treatment and
discharge in accordance with the legal requirements applicable thereto.
Tenant should immediately notify Landlord in detail when Tenant becomes
aware of the presence of any Hazardous Materials not in accordance with
this Section 10.1 or any release relating to the Premises or of any
Hazardous Materials or receipt of any notification by or from any
governmental authority.
10.2 INDEMNIFICATION. If Hazardous Materials are used, stored,
generated or disposed of on or in the Premises, or if the Premises become
contaminated in any manner, Tenant shall indemnify and hold harmless
Landlord from any and all claims, damages, fines, judgments, penalties,
costs, liabilities or losses including, without limitation, a decrease in
value of the Premises, damages due to loss or restriction of rentable
area, or any damages due to adverse impact on marketing of rentable area,
and any and all sums paid for settlement of claims, attorneys' fees,
consultant and expert fees arising from, during or after the Term and
arising as a result of such contamination by Tenant or its agents,
employees, contractors or invitees. This indemnification includes,
without limitation, any and all costs incurred due to any investigation of
the site or any cleanup, removal or restoration mandated by a federal,
state or local agency or political subdivision. Without limitation of the
foregoing, if Tenant causes or permits the presence of any Hazardous
Substances on the Premises and such results in contamination, Tenant shall
promptly, at its sole expense, take any and all necessary actions to
return the Premises to the condition existing prior to the presence of any
such Hazardous Substances on the Premises. Tenant shall first obtain
Landlord's approval for any such remedial action. This indemnification
provision shall survive expiration of the Term or termination of this
Lease for any reason.
10.3 DEFINITION OF HAZARDOUS MATERIALS. "Hazardous Materials" shall
include any and all substances, product wastes, pollutants, materials,
chemicals, contaminants, constituents or other materials which are or
become listed, regulated or addressed under any Environmental Law,
including, without limitation, oil, gasoline, kerosene or other petroleum
distallants or products, dry cleaning solutions, asbestos, polychlorinated
biphenyls (PCBs) and urea formaldehyde, radioactive materials, hazardous
or toxic waste, or any other materials which may be classified as
hazardous or toxic under any Environmental Laws or which could pose a
hazard to the health and safety of any of the occupants or invitees of the
Improvements.
10.4 DEFINITION OF ENVIRONMENTAL LAWS. "Environmental Laws" shall
include any and all federal, state and local laws, rules, regulations,
ordinances, requirements, programs, permits, guidances, orders and consent
decrees relating to health, safety and environmental matters now in effect
or as hereafter amended or enacted, including, without limitation, the
Comprehensive, Environmental, Response, Compensation and Liability Act of
1980, 42 U.S.C. <section>9601 ET SEQ., the Resource Conservation and
Recovery Act of 1976, 42 U.S.C. <section>6901 ET SEQ., the Occupational
<PAGE>
Safety and Health Act, 29 U.S.C. <section>651 ET SEQ., the Clean Air Act,
42 U.S.C. 7402 ET SEQ., the Clean Water Act, 33 U.S.C. <section>1251 ET
SEQ., the Toxic Substances Control Act 15 U.S.C. <section>2601 ET SEQ.,
the Hazardous Materials Transportation Act, 49 U.S.C. <section>1851, ET
SEQ., Superfund Amendments and Reauthorization Act of 1986, and Sections
17-17-1, 29-13-1, 39-7-1, 49-17-1, 49-17-29, 49-29-42, 49-17-43, 49-27-1,
51-3-1, 49-5-1 and 57-15-1 of the Mississippi Code, and any and all
federal, state or local environmental clean up programs and laws and U.S.
Department of Transportation regulations, and all similar laws,
regulations or requirements of any governmental authority or agency having
jurisdiction over any of the parties hereto or any of their affiliates or
any of their properties or assets which may be stored or used in
connection with the Premises, including, without limitation, the use,
handling, transportation, production, generation, disposal, discharge or
storage of any Hazardous Materials. All as may be amended or superseded
from time to time and including any subsequent codifications thereof in
different sections or acts.
ARTICLE 11
SURRENDER; HOLDING OVER
11.1 SURRENDER. On the last day of the Term or upon the earlier
termination of this Lease, Tenant shall peaceably and quietly surrender
the Premises to Landlord, clean, in good order, repair and condition at
least equal to the condition when delivered to Tenant, excepting only fair
wear and tear resulting from normal use. Prior to the surrender of the
Premises to Landlord, Tenant, at its sole cost and expense, shall remove
all liens and other encumbrances which may have resulted from the acts or
omissions of Tenant. If Tenant fails to do any of the foregoing,
Landlord, in addition to other remedies available to it at law or in
equity, may, without notice, enter upon, reenter, possess and repossess
itself thereof, by force, summary proceedings, ejectment, or otherwise,
and may dispossess and remove Tenant and all persons and property from the
Premises; and Tenant waives any and all damages or claims for damages as a
result thereof. Such dispossession and removal of Tenant shall not
constitute a waiver by Landlord of any claims by Landlord against Tenant.
11.2 HOLDING OVER. If Tenant does not surrender possession of the
Premises at the end of the Term or upon the earlier termination of this
Lease, at the election of Landlord, Tenant shall be a tenant-at-sufferance
of Landlord and the Rent and other payments due during the period of such
holdover, shall be two times (2x) the Rent in effect immediately prior to
the end of the Term or termination of this Lease.
ARTICLE 12
MISCELLANEOUS
12.1 NOTICES. Each notice required or permitted to be given
hereunder by one party to the other shall be in writing with a statement
therein to the effect that notice is given pursuant to this Lease, and the
same shall be given and shall be deemed to have been delivered, served and
given by United States registered or certified mail, return receipt
requested, addressed to such party at the address provided for such party
herein, by personal delivery, telecopy or other overnight delivery service
which provide a receipt or other evidence of delivery. Any notices to
Landlord shall be addressed and given to Landlord as follows:
Farm Fish, Inc.
<PAGE>
Attention: _____________
100 West Woodrow Wilson Blvd.
Jackson, Mississippi 39213
Telephone Number: _____________
Telecopy Number: _____________
Any notices to Tenant shall be addressed and given to Tenant as follows:
_______________________________
_______________________________
_______________________________
_______________________________
Telephone Number: _____________
Telecopy Number: _____________
12.2 REMOVAL OF TENANT'S PROPERTY. Tenant shall retain the ownership
of all movable equipment, furniture, and supplies placed in or on the
Premises by Tenant and shall have the right to remove such movable
equipment, furniture, and supplies prior to termination of this Lease
provided that no Event of Default has been committed by Tenant which has
not been fully cured in a manner acceptable to Landlord and further
provided that Tenant repairs any injury to the Premises resulting from
such removal. Unless Tenant has made prior arrangements with Landlord and
Landlord has agreed in writing to permit Tenant to leave such equipment,
furniture or supplies on the Premises for an agreed period, if Tenant does
not remove such movable equipment, furniture and supplies prior to such
termination, then, in addition to its other remedies at law or in equity,
Landlord shall have the right to have such items removed and stored and
all damage to the Premises resulting therefrom repaired at the cost of
Tenant or elect that such movable equipment, furniture and supplies
automatically become the property of the Landlord upon termination of this
Lease, and, in the latter case, Tenant shall not have any further right
with respect thereto or for reimbursement therefor.
12.3 DEFAULT INTEREST. From and after the occurrence of an Event of
Default hereunder, past due payments of Base Rent and/or Additional Rent
or other past due monetary obligation hereunder shall bear interest, from
and after the date the same become due and payable, at an annual rate of
four (4) percentage points above the prime rate of interest as announced
from time to time by Trustmark National Bank or any successor thereof.
Such interest shall continue to accrue until the obligations of Tenant
with respect to the Event of Default have been cured in full. Each change
in the prime rate shall simultaneously change the default rate hereunder.
12.4 BINDING EFFECT. Notwithstanding any provision of this Lease to
the contrary, the rights and obligations of the parties hereunder shall
inure to the benefit of and be binding on the parties hereto and their
respective successors, assigns, heirs, and legal representatives.
<PAGE>
12.5 MERGER OF ESTATES. The voluntary or other surrender of this
Lease by Tenant or a mutual cancellation thereof, shall not work a merger,
but shall, at the option of Landlord, terminate all or any existing
subleases or subtenancies, or may, at the option of Landlord, operate as
an assignment to it of Tenant's interest in any or all such subleases or
subtenancies.
12.6 GOVERNING LAW. This Lease and the rights and obligations of the
parties hereto shall be governed, interpreted, construed and enforced in
accordance with the laws of the State of Mississippi.
12.7 SEVERABILITY. The determination that any one or more provisions
of his Lease is invalid, void, illegal or unenforceable shall not effect
or invalidate the remainder. All obligations of either party requiring
any performance after the expiration of the Term shall survive the
expiration of such Term and shall be fully enforceable in accordance with
those provisions pertaining thereto.
12.8 CONSTRUCTION. Section titles are for convenient reference only
and shall not be used to interpret, expand or limit the meaning of any
provision of this Lease.
12.9 ENTIRE AGREEMENT. No oral statements or prior material not
specifically incorporated herein shall be of any force or effect. Tenant
agrees that in entering into and taking this Lease, it relies solely upon
the representations and agreements contained in this Lease and not others.
This Lease, including the Exhibits which are attached hereto and made a
part hereof for all purposes, constitutes the entire agreement of the
parties and shall in no way be conditioned, modified or supplemented except
by a written agreement executed by and delivered to both parties.
12.10 ATTORNEYS FEES. If any action at law or in equity is necessary
to enforce or interpret the terms of this Lease, the prevailing party, as
ultimately determined by the appropriate court of authority, shall be
entitled to reimbursement of its reasonable attorneys' fees, costs and
necessary disbursements incurred in connection with such action,
arbitration, mediation or appeal thereof in addition to any other relief to
which it may be otherwise entitled either at law or in equity.
12.11 NON-RECOURSE TO LANDLORD. Notwithstanding any provision of this
Lease to the contrary, Tenant hereby agrees that no personal or corporate
liability of any kind or character whatsoever now attaches or at any time
hereafter under any condition shall attach to Landlord for payment of any
amounts payable under this Lease or for the performance of any obligation
under this Lease. The exclusive remedies of Tenant for the failure of
Landlord to perform any of its obligations under this Lease shall be to
proceed against the interests of Landlord in and to the Premises. This
Lease shall be non-recourse to Landlord.
12.12 BROKERAGE COMMISSIONS. Landlord and Tenant represent to each
other that they have acted directly and independently with the other as
principals and that neither Landlord nor Tenant have retained or
authorized the services of any broker, real estate agent or finder with
respect this Lease. Tenant agrees to indemnify and hold Landlord harmless
from and against any and all claims, liabilities and obligations for any
commission, finder's fee or any other compensation in connection with this
Lease claimed by or through Tenant. Landlord agrees to indemnify and hold
Tenant harmless from and against any and all claims, liabilities and
obligations for any commission, finder's fee or other compensation in
connection with this Lease claimed by
<PAGE>
or through Landlord. These mutual indemnifications shall survive
expiration or termination of this Lease for any reason.
12.13 SUBORDINATION/ESTOPPEL CERTIFICATE. The rights and interest of
Tenant under this Lease in and to the Premises shall be subject and
subordinate to any first deeds of trust, mortgages, and other security
instruments and to all renewals, modifications, consolidations,
replacements and extensions thereof ("Security Documents") heretofore or
hereafter executed by Landlord covering the Premises or any parts thereof,
to the same extent as if the Security Documents had been executed,
delivered and recorded prior to the execution of this Lease. After the
delivery to Tenant of a notice from Landlord that it has entered into one
or more Security Documents, then during the term of such Security
Documents Tenant shall deliver the holder or holders of all Security
Documents a copy of all notices to Landlord and shall grant to such holder
or holders the right to cure all defaults, if any, of Landlord hereunder
within the same time period provided in the Lease for such defaults by
Landlord and, except with the prior written consent of the holder or
holders of the Security Documents, shall not (i) amend this Lease, (ii)
surrender or terminate this Lease except pursuant to a right to terminate
expressly set forth in this Lease, or (iii) pay any rent more than one (1)
month in advance or pay any Rent or other amounts payable hereunder other
than in strict accordance with the terms hereof. The provisions of this
Section 12.13 shall be self-operative and shall not require further
agreement by Tenant; provided, however, at the request of Landlord, Tenant
shall execute such further documents as may be reasonably required to
evidence and set forth for the benefit of the holder of any Security
Documents the obligations of Tenant hereunder. Contemporaneous with
obtaining any such financings, Landlord shall use reasonable efforts to
obtain a non-disturbance agreement with any lender providing Tenant the
right to continue to occupy the Premises pursuant to the terms of this
Lease so long as no Event of Default exists. At any time and from time to
time upon not less than ten (10) days' prior notice by Landlord, Tenant
shall execute, acknowledge and deliver to Landlord a statement in writing
certifying that this Lease is unmodified and in full force and effect (or
expressly stating any such modifications and that the same are in full
force and effect has modified), and stating to Tenant's knowledge,
whether or not the Landlord or Tenant is in default under the terms and
provisions of this Lease, and if so, specifying any such claimed default,
it being intended that any such statement may be relied upon by any
prospective purchaser, tenant, mortgagee or assignee of any mortgage
relating to the Premises or the Landlord's interest therein.
12.14 FURTHER ASSURANCES. Landlord and Tenant agree to take such
further action and execute such documents and instruments as may be
reasonably required in order to more effectively carry out the terms of
this Lease and the intention of the parties.
IN WITNESS WHEREOF, this Lease is hereby executed as of the date
first above set forth.
LANDLORD:
FARM FISH, INC.
By: /S/ DAVE ROBISON
Name: Dave Robison
Title: Vice President
<PAGE>
TENANT:
H & S FISH FARMS, INC.
By: /S/ JASON W. SMITH
Name: Jason W. Smith
Title: Vice President
S:\13th\DOC\10643\600\EDGAR\Assetpurch(1018) 2.wpd
<PAGE>
Farm Fish, Inc. Recap as of 7-19-00
Statement of Downpayment Proration
(All Acres Are Water Acres)
POND # ACRES POND # ACRES POND # ACRES EXCLUDED
50N 16.2 65N 12.0 16 8.15
50S 16.2 65 12.0 17 8.73
51E 19.0 65S 12.0 18 9.36
51W 19.0 66E 20.4 19 9.30
52N 18.0 66W 20.4 20 12.0012.00
52S 18.0 67N 19.0 21 10.42
53E 18.9 67S 19.0 22 10.49
53W 18.9 68E 20.4 23 8.07
54N 18.7 68W 20.4 24 9.19 9.19
54S 18.7 69N 19.0 25 8.56
55E 19.0 69S 19.0 26 8.92 8.92
55W 19.0 70E 22.0 27 10.44
56N 19.3 70W 22.0 28 8.15
56S 19.3 71N 18.0 29 8.87 8.87
57E 19.0 71S 18.0 30 11.45
57W 19.0 72E 21.7 31 8.81
58N 20.0 72W 21.7 32N 6.30
58S 20.0 73E 17.4 32S 6.30
59E 12.0 73W 17.4 33 10.4610.46
59 12.0 74 31.6 34 11.41
59W 12.8
60N 17.0 75 19.0 35 10.31
60S 4.0 76 39.5 36 9.31
61E 19.5 77 16.0 37 10.12
61W 19.5 78E 16.2 38 9.85 9.85
62E 17.1 78W 16.2 39 10.0010.00
62W 17.1 79 21.3 40 8.93
63N 18.7 80 24.0 41 9.43
63S 18.7 81 12.5 42 8.75
64E 17.5 82 11.0 43 8.80
64W 17.5 44 8.60
45 8.40
Total Acres1098.7 +287.88Total Excluded 69.29
Net Acres Conv. 719.00 218.59
Total Water Acres 1386.58
(Total Fing. Acres) - (Excluded Acres)/ (Total Farm Acres)=% of Pond Value
218.59/(287.88+1098.7)=0.157646872
(%Pond Value) (Net Total Pond Value)=Total $ of Pond Value Transferred
0.157646872 ($1,800,000-$90,100)=$269,560.39
(Total $ Pond Value + Personal Equity Value) = Total Contract Value
Conveyed
$269,560.39 + $88,600.00 = $358,160.39
$269,560.39 x .06 = $16,173.62
16,173.62/12 = $1,347.80
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<PAGE>
MAP
S:\13th\DOC\10643\600\EDGAR\Assetpurch(1018) 2.wpd
<PAGE>
MAP
S:\13th\DOC\10643\600\EDGAR\Assetpurch(1018) 2.wpd
<PAGE>
EQUIPMENT LEASE AGREEMENT
This Equipment Lease Agreement (this "Lease") is made and entered
into on the ___ day of July, 2000, by and between Farm Fish, Inc., a
Mississippi corporation (the "Lessor"), and H & S Fish Farms, Inc., a
Mississippi corporation (the "Lessee").
NOW, THEREFORE, in consideration of the mutual covenants set forth
herein, Lessor and Lessee intending to be legally bound hereby agree as
follows:
ARTICLE 1
PREMISES; TERM
1.1 LEASED EQUIPMENT. Lessor hereby leases to Lessee and Lessee
hereby leases from Lessor for the rental and on the terms and conditions
contained herein that certain machinery and equipment (as more fully
described on Exhibit 1 attached hereto) which is currently located in
Humphreys County, Mississippi (collectively, the "Equipment").
1.2 INITIAL TERM. Subject to and upon the terms and conditions set
forth herein, this Lease shall be in force for a term of twenty (20)
months beginning on the date hereof (the "Commencement Date") and ending
on the 31st day of March, 2002, unless sooner terminated pursuant to the
provisions hereof (the "Term").
ARTICLE 2
RENT; PAYMENT
2.1 RENT. Lessee agrees to pay to Lessor as base rent Four Hundred
Forty Three Dollars ($443.00) per month ("Base Rent") which is based on a
six percent (6 %) interest factor on the mutually agreed upon allocated
portion of the Purchase Price applicable to the Equipment ($88,600).
"Additional Rent" shall consist of any and all payment obligations or
other liabilities of Lessee under this Lease, other than Base Rent.
2.2 PAYMENT OF RENT. On or before the tenth (10{th}) day of each
calendar month during the Term, Lessee shall pay to Lessor for such month
one-twelfth (1/12) of the annual Base Rent, plus any Additional Rent then
due and payable (collectively, the "Rent"). All payments of Rent shall be
paid to Lessor in lawful money of the United States of America at the
address of Lessor shown herein or to such other party or at such other
place as Lessor may designate from time to time by notice to Lessee. If
this Lease commences or terminates on any day other than the first or last
day of a calendar month, the Rent due hereunder shall be prorated except
as otherwise provided in this Lease.
2.3 LATE PAYMENT. Subject to Lessee's right to defer Base Rent, in
the event that Lessor does not receive rental payments by thirty (30)
days after the scheduled payment date, Lessee shall pay, in addition to
any interest which may be due under Section 12.2, a late charge equal to
four percent (4%) of the rent then due and payable. Lessee acknowledges
and agrees that this late payment charge is intended to compensate Lessor
for administrative and other expenses which it may incur in connection
with collection of any past due rental payments and is not intended and
shall not be deemed to constitute interest, a penalty or as limiting
Lessor's remedies in any manner.
2.4 NET LEASE. This is an absolutely net lease and the Rent shall
be paid without notice, demand, set-off, counterclaim, recoupment,
abatement, suspension, deferment, diminution, deduction, reduction or
defense.
2.5 NON-TERMINABILITY. Except as otherwise expressly provided in
this Lease, (i) this Lease shall not terminate, (ii) Lessee shall not have
any right to terminate this Lease during the Term, (iii) Lessee shall not
be entitled to any set-off, counterclaim, recoupment, abatement,
suspension, deferment, diminution, deduction, reduction or defense of or
to Rent or any other sums payable under this Lease, and (iv) the
obligations of Lessee under this Lease shall not be affected by any
interference with Lessee's use of any of the Equipment for any reason,
including, without limitation, the following: (A) any damage to, or theft,
loss or destruction of any of the Equipment by any cause whatsoever, (B)
the prohibition, limitation or restriction of Lessee's use of any of the
Equipment, (C) any termination by paramount title or otherwise, (D) any
default on the part of Lessor under any other agreement, (E) any latent
or other defect in any of the Equipment, (F) the breach of any warranty of
any seller or manufacturer of any of the Equipment, (G) any violation of
Section 5.9, (H) the exercise of any remedy, including foreclosure by any
security interest holder, (I) any interference with Lessee's use of the
Equipment, (J) market or economic changes or (K) any other cause, whether
similar or dissimilar to the foregoing, any present or future legal
requirement to the contrary notwithstanding. It is the intention of the
parties hereto that the obligations of Lessee hereunder shall be separate
and independent covenants and agreements, that Rent shall continue to be
payable in all events, and that the obligations of Lessee hereunder shall
continue unaffected, unless the requirement to pay or perform the same
shall have been terminated pursuant to an express provision of this Lease.
2.6 NO WARRANTY DISCLAIMER. LESSEE ACKNOWLEDGES THAT THE EQUIPMENT
IS IN GOOD CONDITION AND REPAIR ON THE COMMENCEMENT DATE. LESSOR HAS NOT
MADE AND WILL NOT MAKE ANY INSPECTION OF ANY OF THE EQUIPMENT AND LESSOR
LEASES AND WILL LEASE AND LESSEE TAKES AND WILL TAKE THE EQUIPMENT "AS
IS." LESSEE ACKNOWLEDGES THAT LESSOR (WHETHER ACTING AS LESSOR HEREUNDER
OR IN ANY OTHER CAPACITY) HAS NOT MADE AND WILL NOT MAKE, NOR SHALL LESSOR
BE DEEMED TO HAVE MADE, ANY WARRANTY OR REPRESENTATION, EXPRESS OR
IMPLIED, WITH RESPECT TO ANY OF THE EQUIPMENT, INCLUDING, WITHOUT
LIMITATION, ANY WARRANTY OR REPRESENTATION AS TO (I) ITS FITNESS FOR USE
OR PURPOSE, DESIGN OR CONDITION FOR ANY PARTICULAR USE OR PURPOSE, (II)
THE QUALITY OF THE MATERIAL OF WORKMANSHIP THEREIN, (III) THE EXISTENCE OF
ANY DEFECT, LATENT OR PATENT, (IV) PATENT INFRINGEMENT OR THE LIKE (V)
VALUE, (VI) COMPLIANCE WITH SPECIFICATIONS, (VII) LOCATION, (VIII) USE,
(IX) CONDITION, (X) MERCHANTABILITY, (XI) QUALITY, (XII) DESCRIPTION,
(XIII) DURABILITY, (XIV) OPERATION OR PERFORMANCE THEREOF, OR (XV) THE
EXISTENCE OF ANY HAZARDOUS MATERIALS, IT BEING AGREED THAT ALL RISKS
INCIDENT THERETO ARE TO BE BORNE BY LESSEE. LESSEE ACKNOWLEDGES THAT THE
EQUIPMENT HAVE BEEN INSPECTED BY LESSEE AND ARE SATISFACTORY AND
ACCEPTABLE TO IT. IN THE EVENT OF ANY DEFECT OR DEFICIENCY IN ANY OF
THE EQUIPMENT OF ANY NATURE, WHETHER PATENT OR LATENT, LESSOR SHALL NOT
HAVE ANY RESPONSIBILITY OR LIABILITY WITH RESPECT THERETO OR FOR ANY
INCIDENTAL OR CONSEQUENTIAL DAMAGES (INCLUDING STRICT LIABILITY IN
<PAGE>
TORT). THE PROVISION OF THIS SECTION 2.6 HAVE BEEN NEGOTIATED AND ARE
INTENDED TO BE A COMPLETE EXCLUSION AND NEGATION OF ANY REPRESENTATIONS OR
WARRANTIES BY LESSOR, EXPRESS OR IMPLIED, WITH ANY OTHER LEGAL
REQUIREMENTS NOW OR HEREAFTER IN EFFECT OR OTHERWISE.
ARTICLE 3
ASSIGNMENT; SUBLETTING
3.1 LESSOR ASSIGNMENT. Lessor shall have the right to transfer and
assign in whole or in part, by operation of law or otherwise, its rights
and obligations hereunder whenever Lessor, in its sole judgment, deems it
appropriate without any liability to Lessee and Lessee shall attorn to any
party to which Lessor transfers the Equipment.
3.2 LESSEE ASSIGNMENT AND SUBLETTING. Notwithstanding any provision
to the contrary in this Section 3.2, Lessee shall not sublease the
Equipment, or any portion thereof, or transfer possession or occupancy
thereof to any person, firm or corporation or transfer or assign this
Lease, or any right or privilege arising hereunder, without the prior
written consent of Lessor, which may be conditioned or withheld in
Lessor's sole discretion; provided, however, Lessee may assign its rights
hereunder to an affiliate or wholly owned subsidiary upon prior notice to
Lessor. Neither an assignment to an affiliate or subsidiary of Lessee nor
any consent by Lessor to any other assignment or sublease by Lessee shall
operate as a release of Lessee or a waiver of the necessity for obtaining
Lessor's consent in writing to any subsequent assignment or sublease; nor
shall the collection or acceptance of rent from any such assignee,
subtenant or occupant constitute a waiver or release of Lessee of any
covenant or obligation contained in this Lease. In the event that Lessee
defaults under this Lease in the payment of Rent, Lessee hereby assigns to
Lessor the rent due from any subtenant of Lessee and hereby authorizes
each such subtenant to pay said rent directly to Lessor.
ARTICLE 4
MAINTENANCE; SERVICES; TAXES
4.1 MAINTENANCE AND REPAIR. Lessee shall provide all maintenance
and repair of the Equipment. Lessee, at its sole cost, shall maintain and
repair the Equipment and otherwise keep the Equipment in good working
order and repair, but all workmen and contractors employed for such
purposes shall be specifically approved by Lessor prior to the
commencement of any work on the Equipment, except in the event of an
emergency. In the event Lessee fails to timely conduct any such
maintenance or repairs, Lessor shall have the right, but not the
obligation to conduct such maintenance or repairs. Any cost incurred plus
reasonable profit and overhead for Lessor's administration thereof (as set
forth in Section 9.1) shall be immediately due and payable in full as
Additional Rent hereunder. Lessor shall not be required to maintain or
make any repair whether foreseen or unforeseen or to maintain any of the
Equipment in any way, and Lessee hereby expressly waives the right to
maintain or make repairs at the expense of Lessor, which right may be
provided for in any legal requirement now or hereafter in effect.
<PAGE>
4.2 TAXES ON PERSONALTY. Lessee shall before interest, fines or
penalties are due thereon pay all ad valorem personal property and similar
taxes or special assessments levied upon or applicable to the Equipment.
4.3 LESSEE'S EQUIPMENT AND INSTALLATIONS. Lessee shall not install
within or attach to the Equipment any other equipment, addition or make
any other improvements to the Equipment until the plans therefor have been
approved in writing by Lessor, such approval may not be unreasonably
withheld or delayed. In no event shall any such addition or improvement
impair the intended function or normal operation of the Equipment.
Provided, however, any and all such attachments or improvements shall
become part of the Equipment and shall be the property of Lessor.
ARTICLE 5
POSSESSION, USE AND UPKEEP OF PREMISES
5.1 POSSESSION. During the Term, Lessee shall have the right to use
the Equipment beginning on the Commencement Date. Lessee agrees that any
such use shall be deemed to be under all the terms, covenants, conditions
and provisions of this Lease. Landlord represents that it is the current
owner of the Equipment.
5.2 AUTHORIZED USE. Lessee shall have the right to use or permit
the use of the Equipment only in connection with the catfish farming
operation conducted on the Premises being leased by Lessor from Lessee or
any other related uses consistent with the nature of the Equipment and the
terms hereof.
5.3 ILLEGAL AND PROHIBITED USES. Lessee shall not use or permit any
other party to use all or any part of the Equipment for any purpose not
authorized in Section 5.2 hereof. Lessee shall not do or permit anything
to be done with the Equipment which is prohibited by or which will in any
way conflict with any law, statute, ordinance or governmental rule or
regulation now in force or hereafter enacted or promulgated, or which is
prohibited by any standard form of fire insurance policy or which will in
any way increase the existing rate of or affect any fire or other similar
insurance, or cause a cancellation of any insurance policy covering the
Equipment or any part thereof or any of its contents. Lessee shall not
cause, maintain or permit any nuisance relating to the Equipment or commit
or suffer to be committed any waste to the Equipment.
5.4 ALTERATIONS AND ADDITIONS. Lessee shall not make any
improvements, alterations or additions to the Equipment except with the
prior written consent of Lessor, which shall not be unreasonably withheld
or delayed. All improvements, alterations and additions to the Equipment
shall be the property of the Lessor and shall not be removed by Lessee
either during or after the end of the Term without the express written
approval of Lessor. Lessee shall promptly pay any and all costs and
expenses relating in any manner to any improvements, alterations or
additions. Lessee shall not be entitled to any reimbursement or
compensation resulting from its payment of the cost of all or any portion
of improvements or any alterations or additions thereto unless otherwise
expressly agreed to by Lessor in writing.
<PAGE>
5.5 RULES AND REGULATIONS OF EQUIPMENT. Upon written notice, Lessee
shall perform and comply with the rules and regulations of the Equipment,
if any, with respect to safety, care, cleanliness, and preservation of
good order.
5.6 COMPLIANCE WITH LAWS AND OTHER REGULATIONS. Lessee shall, at
its sole cost and expense, promptly comply: (i) with all laws, statutes,
ordinances and governmental rules, regulations or requirements now in
force or which may hereafter be in force, including, without limitation,
all Environmental Laws (as defined in Section 10.4), (ii) with the
requirements of any board of fire underwriters or other similar body now
or hereafter constituted, and (iii) with any directive or occupancy
certificate issued pursuant to any law by any public officer or officers
insofar as any relate to or affect the condition or use of the Equipment.
5.7 LESSOR'S ACCESS. Lessor shall have the right, at reasonable
times during normal operating hours (except at any time in the event of an
emergency) during the Term, to inspect the condition of the Equipment, to
determine if Lessee is performing its obligations under this Lease, and to
perform the services or to make the repairs and restoration that Lessor
elects to perform under this Lease, to cure any defaults of Lessee
hereunder that Lessor elects to cure, and to remove from the Equipment any
improvements thereto or property placed therein in violation of this
Lease.
5.8 LIENS. Lessee shall not permit any mechanics', materialmen's or
other liens, security interests, pledge, deed of trust or other
encumbrance, of any type (collectively "Liens") to be fixed or placed
against the Equipment, and agrees immediately to promptly discharge any
Liens which are allegedly fixed or placed against the Equipment. In all
events, any such Lien shall be discharged within thirty (30) days of it
being affixed or placed upon the Equipment.
5.9 QUIET POSSESSION. Provided Lessee has performed all its
obligations under this Lease, including, without limitation, the payment
of Rent, Lessee shall peaceably and quietly hold and enjoy the Equipment
for the Term, subject to the provisions and conditions set forth in this
Lease.
ARTICLE 6
INSURANCE; LIABILITY; INDEMNITY
6.1 PROPERTY INSURANCE. During the Term of this Lease, Lessee, at
its sole cost, shall obtain and maintain with insurance companies approved
Lessor, fire and extended coverage insurance insuring the Equipment
against loss or damage from fire, lightning, windstorm, explosion,
earthquake, boiler, machinery and such other risks usually included under
extended coverage policies, with such coverages, amounts, deductibles and
exclusions as shall be approved by Lessor. Such extended coverage
insurance shall insure the Equipment. Such insurance shall be in an
amount at least equal to the replacement value of all property covered,
including, without limitation, the Equipment, and shall name Lessor as an
additional insured. A certificate of such insurance shall be furnished to
Lessor, and such policy shall provide that it may not be altered or
canceled without thirty (30) days prior notice to Lessor.
6.2 LIABILITY INSURANCE. During the Term of this Lease, Lessee, at its
sole cost, shall obtain and maintain with insurance companies approved by
Lessor, comprehensive general liability
<PAGE>
insurance, including property damage, insuring Lessee, Lessor and Lessor's
designees, if any, against losses, liability or claims for injury to persons
or property occurring or relating in any manner to the Equipment or arising
out of the maintenance or use thereof by Lessee. The liability under such
insurance shall not be less than $1,500,000 for any one person injured and/or
killed and not less than $1,500,000 for any one accident and not less than
$1,500,000 in the aggregate, all such amounts to be increased if, in the
reasonable judgment of Lessor, any such increase is reasonably necessary for
Lessor's protection and consistent with industry practices and the location of
the Equipment. In addition, Lessee shall maintain all necessary workmen's
compensation insurance required by law and such other insurance, including,
without limitation, business interruption insurance, in amounts and types as
Lessor may reasonably require. A certificate of such insurance shall be
furnished to Lessor, and such policy shall provide that it may not be altered
or cancelled without thirty (30) days prior notice to Lessor.
6.3 FIRE OR OTHER CASUALTY. If the Equipment is damaged or destroyed,
in whole or in part, by fire or other casualty at any time during the Term of
this Lease, within thirty (30) days after any such event Lessee shall
commence, and diligently pursue necessary action to restore or replace the
damaged or destroyed portion to substantially the same condition that existed
immediately prior to such damage or destruction. If such damage or
destruction occurs, the Base Rent shall not be abated in any manner and this
Lease shall continue in full force and effect in accordance with its terms.
Lessee shall use its best efforts to replace the damaged or destroyed portions
of the Equipment within one hundred twenty (120) days of such damage, subject
to delays arising from acts of God, shortages of labor or materials, war, or
other similar or dissimilar conditions or events beyond the reasonable control
of Lessee.
6.4 WAIVER OF CLAIMS. Notwithstanding any provision of this Lease to
the contrary, Lessee hereto releases and waives all claims, rights of
recovery, and causes of action that either such party or any party claiming
by, through, or under Lessee by subrogation or otherwise may now or hereafter
have against Lessor or any of its directors, officers, partners, employees, or
agents for any loss or damage that may occur to the Equipment, Lessee's
improvements, or any of the contents of any of the foregoing by reason of
fire, act of God, the elements, or any other cause including, without
limitation, negligence of Lessor or its directors, officers, partners,
employees, or agents that could have been insured against under the terms of
standard fire and extended coverage insurance policies. Lessor shall not be
liable to Lessee for any inconvenience or loss to Lessee in connection with
any repair, maintenance, damage, destruction, restoration, or replacement
referred to in this Lease. Lessor shall not be obligated to insure the
Equipment and Lessor shall not be obligated to repair, maintain, restore, or
replace or otherwise be liable for any damage to or destruction of any of the
Equipment. Lessor shall reasonably cooperate with Lessee in connection with
Lessee's obligations hereunder.
6.5 INDEMNITY. Lessee shall indemnify and hold harmless Lessor and
Lessor's agents, directors, officers, partners, employees, invitees, and
contractors, from all claims, losses, costs, damages, or expenses including,
without limitation, attorneys' fees, resulting or arising from any and all
injuries to, including death of, any person or damage to any property caused
by any act, omission, or neglect of Lessee or Lessee's directors, officers,
partners, employees, agents, invitees, or guests, or any parties contracting
with Lessee relating to the Equipment, unless caused solely by the wilful
misconduct or gross negligence of Lessor. Lessor shall not be liable for
any damage of any kind or for any damage to property, death or injury to
persons from any cause
<PAGE>
whatsoever by reason of the use of the Equipment by Lessee. Lessor shall not
be liable to Lessee and Lessee hereby waives all claims against Lessor or
Lessor's directors, officers, partners, employees, or agents for any damage
or loss of any kind, for direct damages, consequential damages, loss of
profits, business interruption, and for any damage to property, death or
injury to persons from any cause whatsoever, including, without limitation,
acts of others, vandalism, loss of trade secrets or other confidential
information, any damage, loss or injury caused by a defect in the Equipment,
unless caused solely by the willful misconduct or gross negligence of Lessor.
The provisions of this Section 6.5 shall survive expiration or termination of
this Lease for any reason.
ARTICLE 7
CONDEMNATION
7.1 CONDEMNATION. Except as expressly set forth herein, if any
significant portion of the Equipment as determined by Lessor shall be taken
as a result of the exercise of the power of eminent domain, this Lease shall
terminate as of the date of taking. In the event of any taking, Lessor shall
be entitled to any and all compensation, damages, income, rent and awards
with respect thereto, except for an award, if any, specified by the
condemning authority for any property that Lessee has the right to remove
upon termination of this Lease. Lessee shall have no claim against Lessor
for the value of any unexpired Term.
ARTICLE 8
DEFAULT; REMEDIES
8.1 EVENT OF DEFAULT. The term "Event of Default" or "Default"
refers to the occurrence of any one or more of the following: (i) failure
of Lessee to pay, within five (5) days of the due date, any Rent or other
amount required to be paid under this Lease subject to the right to defer
Base Rent under Section 2.3 hereof; or (ii) failure of Lessee after thirty
(30) days written notice from Lessor of Lessee's default in the performance
of any of Lessee's obligations, covenants or agreements under this Lease,
to do, observe, keep and perform with diligence and continuity any of such
obligations, covenants, or agreements (if such failure cannot reasonably be
cured within such thirty (30) day period, the length of such period shall
be extended for the period reasonably required therefor if Lessee commences
curing such failure within such thirty (30) day period and continues the
curing thereof with reasonable diligence and continuity); (iii) substantial
abandonment of the Equipment for more than thirty (30) days; (iv) any
default under that certain Asset Purchase Agreement dated July __, 2000
between Lessee and Lessor (the "Purchase Agreement"), or any "Event of
Default" under that certain Real Property Lease Agreement between Lessor
and Lessee of even date herewith; or (v) the adjudication of Lessee to be
bankrupt; or (vi) the filing by Lessee of a voluntary petition in
bankruptcy, receivership, or other related or similar proceedings; or
(vii) the making by Lessee of a general assignment for the benefit of its
creditors; or (viii) the appointment of a receiver of Lessee's interests
in the Equipment in any action, suit or proceeding by or against Lessee's
interest in the Equipment or by or against Lessee; or (ix) any other
voluntary or involuntary proceedings instituted by or against Lessee under
any bankruptcy or similar laws, unless the occurrence of any such
involuntary receivership or proceedings is cured by the same being
dismissed or stayed within sixty (60) days thereafter; or (x) the failure
of Lessee to discharge any judgment against Lessee in excess of $10,000
either singularly or in the aggregate within sixty (60) days after
such judgment becomes final; or (xi) the
sale or attempted sale under execution or other legal process of the
interest of Lessee in the Equipment.
8.2 REMEDIES UPON DEFAULT. Upon the occurrence of an Event of
Default, Lessee shall be in default hereunder and all sums due or to become
due hereunder and all other obligations then owing by Lessee to Lessor
shall, at Lessor's option, become immediately due and payable. If an Event
of Default occurs, Lessor, at any time thereafter prior to the curing of
such Event of Default and without waiving any other rights herein available
to Lessor at law or in equity, at its option, may: (a) by notice to Lessee
terminate this Lease; (b) exercise all the rights and remedies of a secured
party under the Uniform Commercial Code and/or other applicable laws,
including the right to any deficiency remaining after disposition of the
Equipment for which Lessee agrees to remain fully liable; (c) proceed by
appropriate court action or actions or other proceedings either at law or
in equity to specifically enforce performance by Lessee of any and all
covenants of this Lease and to recover damages for the breach thereof; (d)
demand that Lessee deliver the Equipment forthwith to Lessor at Lessee's
expense at such place as Lessor may designate; (e) without notice or
liability or legal process, enter into any premises of or under control or
jurisdiction of Lessee or any agent of Lessee where the Equipment may be or
by Lessor is believed to be, and repossesses all or any item thereof,
disconnecting and separating all thereof from any other property and using
all force necessary or permitted by applicable law so to do, Lessee hereby
expressly waiving all further rights to possession of the Equipment and all
claims for injuries suffered through or loss caused by such repossession
and agrees to hold Lessor harmless from any such action; and (f) sell,
dispose of, hold, use, or lease any Equipment as Lessor in its discretion
may decide, without any duty to account to Lessee; but the Lessor shall,
nevertheless, be entitled to recover immediately as liquidated damages for
loss of the bargain and not as a penalty any unpaid Rent that accrued on or
before the occurrence of the Event of Default plus an amount equal to the
difference between the present value as of the date of the occurrence of
such Event of Default, of the aggregate Rent reserved hereunder for the
unexpired Term of this Lease plus the Purchase Price and the then present
value of the aggregate rental and fair market value of all Equipment for
such unexpired Term which the Lessor reasonably estimates to be obtainable
for the Equipment during such unexpired Term. The discount rate shall be
six percent (6%) per annum. In no event shall Lessor's exercise of any or
more remedies hereunder granted or otherwise available to it be deemed to
be an acceptance or surrender of the Equipment by Lessee, whether by
agreement or operation of law, it being understood that such surrender can
be affected only by the written agreement of Lessor and Lessee. In no case
shall Lessor be liable for failure to re-rent or sale the Equipment and in
no event shall Lessee be entitled to any excess rents or proceeds received
by Lessor. The remedies expressed herein are cumulative and not exclusive
to any other rights and remedies Lessor may have either at law or in
equity. Lessor shall be entitled to pursue simultaneously multiple or
alternative remedies, at any time to abandon or resume pursuit of any
remedy, and at any time to pursue additional remedies.
8.3 NON-WAIVER. No consent or waiver, express or implied, by Lessor to
or of any breach in the performance or observance by Lessee of any of its
obligations under this Lease, including, without limitation, any Event of
Default, shall be construed as or constitute a consent or waiver to or of any
other breach in the performance or observance by Lessee of such obligation or
any other obligations of Lessee. Neither the acceptance by Lessor of any
Rent or other payment hereunder, whether or not any default hereunder by
Lessee is then known to Lessor, nor any custom or practice followed in
connection with this Lease shall constitute a waiver of any of
<PAGE>
Lessee's obligations under this Lease. Failure by Lessor to complain of any
action or non-action on the part of Lessee or to declare Lessee in default
irrespective of how long such failure may continue, shall not be deemed to be
a waiver by Lessor of any of its rights hereunder. Notwithstanding any
provision of this Lease to the contrary, all Rent and other amounts payable
by Lessee under this Lease shall be paid without abatement, offset,
counterclaim or diminution to any extent whatsoever. Except for the
execution and delivery of a written agreement expressly accepting surrender
of the Equipment, no act taken or failed to be taken by Lessor shall be
deemed an acceptance of surrender of the Equipment.
ARTICLE 9
FAILURE TO PERFORM
9.1 LESSEE'S FAILURE TO PERFORM. In the event Lessee fails to perform
any one or more of its obligations hereunder, in addition to the other rights
of Lessor hereunder, Lessor shall have the right, but not the obligation, to
perform all or any part of such obligations of Lessee. Upon receipt of a
demand therefor from Lessor, Lessee shall reimburse Lessor for the cost to
Lessor of performing such obligations, plus interest at the rate set forth in
Section 12.2.
9.2 LESSOR'S FAILURE TO PERFORM. In the event Lessor fails to perform
any of its obligations under Sections 5.1 or 5.9 of this Lease, in addition
to the other rights of Lessee hereunder, Lessee shall have the right to set
off against the Rent due hereunder the cost and expense directly relating to
such breach by Lessor. Upon receipt of a demand therefor from Lessee, Lessor
shall use commercially reasonable efforts to cure any such breach of Sections
5.1 or 5.9 of this Lease.
ARTICLE 10
ENVIRONMENTAL MATTERS
10.1 USE OF HAZARDOUS MATERIALS. Lessee shall not cause or permit any
Hazardous Materials or raw materials which contain Hazardous Materials to be
stored, located, discharged, emitted, processed, generated, managed,
possessed or otherwise used or handled in connection with the Equipment and
shall comply with all Environmental Laws affecting the Equipment or Lessee's
use thereof. Attached hereto as EXHIBIT 10.1 is a listing of Hazardous
Materials currently used by Lessor in its operations. To Lessor's actual
knowledge, its current use is in material compliance with all applicable
Environmental Laws. Notwithstanding the foregoing, Lessor hereby
acknowledges that Lessee may use, store or otherwise handle certain Hazardous
Materials in compliance with the next succeeding sentences. At all times,
Lessee shall use, store, handle and dispose of any and all Hazardous
Materials in strict accordance with all applicable Environmental Laws. Prior
to use, storage or otherwise handling of any Hazardous Materials in, on or
around the Equipment, Lessee shall provide and maintain a complete and
accurate detailed list and description of all types of Hazardous Materials
used, stored, handled, discharged or otherwise disposed of in connection with
Lessee's use of the Equipment. Lessor has the right but not the obligation
to prohibit the use of specific Hazardous Materials. No Hazardous Materials
shall be placed into the plumbing or waste treatment systems of the Equipment
except for systems which are designed to accept Hazardous Materials for
treatment and discharge in accordance with the legal requirements applicable
thereto. Lessee should immediately notify Lessor in detail when Lessee
becomes aware of the presence of any Hazardous Materials not previously
authorized or
<PAGE>
not in accordance with this Section 10.1 or any release relating to the
Equipment or of any Hazardous Materials or receipt of any notification by or
from any governmental authority.
10.2 INDEMNIFICATION. If Hazardous Materials are used, stored,
generated or disposed of in connection with the Equipment, or if the
Equipment becomes contaminated in any manner, Lessee shall indemnify and hold
harmless Lessor from any and all claims, damages, fines, judgments,
penalties, costs, liabilities or losses including, without limitation, a
decrease in value of the Equipment, damages due to loss or restriction of
rentable area, or any damages due to adverse impact on marketing of rentable
area, and any and all sums paid for settlement of claims, attorneys' fees,
consultant and expert fees arising from, during or after the Term and arising
as a result of such contamination by Lessee or its agents, employees,
contractors or invitees. This indemnification includes, without limitation,
any and all costs incurred due to any investigation of the site or any
cleanup, removal or restoration mandated by a federal, state or local agency
or political subdivision. Without limitation of the foregoing, if Lessee
causes or permits the presence of any Hazardous Substances and such results
in contamination, Lessee shall promptly, at its sole expense, take any and
all necessary actions to return the Equipment to the condition existing prior
to the presence of any such Hazardous Substances. Lessee shall first obtain
Lessor's approval for any such remedial action. This indemnification
provision shall survive expiration of the Term or termination of this Lease
for any reason. This indemnification provision shall not include the items
referenced in that certain [Hazclean Report].
10.3 DEFINITION OF HAZARDOUS MATERIALS. "Hazardous Materials" shall
include any and all substances, product wastes, pollutants, materials,
chemicals, contaminants, constituents or other materials which are or become
listed, regulated or addressed under any Environmental Law, including,
without limitation, oil, gasoline, kerosene or other petroleum distallants or
products, dry cleaning solutions, asbestos, polychlorinated biphenyls (PCBs)
and urea formaldehyde, radioactive materials, hazardous or toxic waste, or
any other materials which may be classified as hazardous or toxic under any
Environmental Laws or which could pose a hazard to the health and safety of
any of the occupants or invitees of the Improvements.
10.4 DEFINITION OF ENVIRONMENTAL LAWS. "Environmental Laws" shall
include any and all federal, state and local laws, rules, regulations,
ordinances, requirements, programs, permits, guidances, orders and consent
decrees relating to health, safety and environmental matters now in effect
or as hereafter amended or enacted, including, without limitation, the
Comprehensive, Environmental, Response, Compensation and Liability Act of
1980, 42 U.S.C. <section>9601 ET SEQ., the Resource Conservation and
Recovery Act of 1976, 42 U.S.C. <section>6901 ET SEQ., the Occupational
Safety and Health Act, 29 U.S.C. <section>651 ET SEQ., the Clean Air Act, 42
U.S.C. 7402 ET SEQ., the Clean Water Act, 33 U.S.C. <section>1251 ET SEQ.,
the Toxic Substances Control Act 15 U.S.C. <section>2601 ET SEQ., the
Hazardous Materials Transportation Act, 49 U.S.C. <section>1851, ET SEQ.,
Superfund Amendments and Reauthorization Act of 1986, and Sections 17-17-1,
29-13-1, 39-7-1, 49-17-1, 49-17-29, 49-29-42, 49-17-43, 49-27-1, 51-3-1, 49-
5-1 and 57-15-1 of the Mississippi Code, and any and all federal, state or
local environmental clean up programs and laws and U.S. Department of
Transportation regulations, and all similar laws, regulations or
requirements of any governmental authority or agency having jurisdiction
over any of the parties hereto or any of their affiliates or any of their
properties or assets which may be stored or used in connection with the
Equipment, including, without limitation, the use, handling, transportation,
production, generation, disposal, discharge or storage of any Hazardous
Materials. All as may be amended
<PAGE>
or superseded from time to time and including any subsequent codifications
thereof in different sections or acts.
ARTICLE 11
SURRENDER; HOLDING OVER
11.1 SURRENDER. On the last day of the Term or upon the earlier
termination of this Lease, Lessee shall peaceably and quietly surrender the
Equipment to Lessor, in good order, repair and condition at least equal to
the condition when delivered to Lessee, excepting only fair wear and tear
resulting from normal use. Prior to the surrender of the Equipment to
Lessor, Lessee, at its sole cost and expense, shall remove all liens and
other encumbrances which may have resulted from the acts or omissions of
Lessee. If Lessee fails to do any of the foregoing, Lessor, in addition to
other remedies available to it at law or in equity, may, without notice,
enter upon, reenter, possess and repossess itself thereof, by force, summary
proceedings, ejectment, or otherwise, and may dispossess and remove Lessee
and all persons and property from the Equipment; and Lessee waives any and
all damages or claims for damages as a result thereof. Such dispossession
and removal of Lessee shall not constitute a waiver by Lessor of any claims
by Lessor against Lessee.
11.2 HOLDING OVER. If Lessee does not surrender possession of the
Equipment at the end of the Term or upon the earlier termination of this
Lease, at the election of Lessor, Lessee shall be a tenant-at-sufferance of
Lessor and the Rent and other payments due during the period of such
holdover, shall be two times (2x) the Rent in effect immediately prior to
the end of the Term or termination of this Lease.
ARTICLE 12
MISCELLANEOUS
12.1 NOTICES. Each notice required or permitted to be given hereunder
by one party to the other shall be in writing with a statement therein to
the effect that notice is given pursuant to this Lease, and the same shall
be given and shall be deemed to have been delivered, served and given by
United States registered or certified mail, return receipt requested,
addressed to such party at the address provided for such party herein, by
personal delivery, telecopy or other overnight delivery service which
provide a receipt or other evidence of delivery. Any notices to Lessor
shall be addressed and given to Lessor as follows:
Farm Fish, Inc.
Attention: _____________
100 West Woodrow Wilson Blvd.
Jackson, Mississippi 39213
Telephone Number: _____________
Telecopy Number: _____________
Any notices to Lessee shall be addressed and given to Lessee as follows:
___________________________
___________________________
<PAGE>
___________________________
Telephone Number: _____________
Telecopy Number: _____________
12.2 DEFAULT INTEREST. From and after the occurrence of an Event of
Default hereunder, past due payments of Base and/or Additional Rent or
other past due monetary obligation hereunder shall bear interest, from and
after the date the same become due and payable, at an annual rate of four
(4) percentage points above the prime rate of interest as announced from
time to time by Trustmark National Bank or any successor thereof. Such
interest shall continue to accrue until the obligations of Lessee with
respect to the Event of Default have been cured in full. Each change in the
prime rate shall simultaneously change the default rate hereunder.
12.3 BINDING EFFECT. Notwithstanding any provision of this Lease to
the contrary, the rights and obligations of the parties hereunder shall
inure to the benefit of and be binding on the parties hereto and their
respective successors, assigns, heirs, and legal representatives.
12.4 MERGER OF ESTATES. The voluntary or other surrender of this Lease
by Lessee or a mutual cancellation thereof, shall not work a merger, but
shall, at the option of Lessor, terminate all or any existing subleases or
subtenancies, or may, at the option of Lessor, operate as an assignment to
it of Lessee's interest in any or all such subleases or subtenancies.
12.5 GOVERNING LAW. This Lease and the rights and obligations of the
parties hereto shall be governed, interpreted, construed and enforced in
accordance with the laws of the State of Mississippi.
12.6 SEVERABILITY. The determination that any one or more provisions
of his Lease is invalid, void, illegal or unenforceable shall not effect or
invalidate the remainder. All obligations of either party requiring any
performance after the expiration of the Term shall survive the expiration of
such Term and shall be fully enforceable in accordance with those provisions
pertaining thereto.
12.7 CONSTRUCTION. Section titles are for convenient reference only
and shall not be used to interpret, expand or limit the meaning of any
provision of this Lease.
12.8 ENTIRE AGREEMENT. No oral statements or prior material not
specifically incorporated herein shall be of any force or effect. Lessee
agrees that in entering into and taking this Lease, it relies solely upon
the representations and agreements contained in this Lease and not others.
This Lease, including the Exhibits which are attached hereto and made a part
hereof for all purposes, constitutes the entire agreement of the parties and
shall in no way be conditioned, modified or supplemented except by a written
agreement executed by and delivered to both parties.
12.9 ATTORNEYS FEES. If any action at law or in equity is necessary to
enforce or interpret the terms of this Lease, the prevailing party, as
ultimately determined by the appropriate court or authority, shall be
entitled to reimbursement of its reasonable attorneys' fees, costs and
necessary disbursements incurred in connection with such action,
arbitration, mediation or appeal
<PAGE>
thereof in addition to any other relief to which it may be otherwise
entitled either at law or in equity.
12.10 NON-RECOURSE TO LESSOR. Notwithstanding any provision of this
Lease to the contrary, Lessee hereby agrees that no personal or corporate
liability of any kind or character whatsoever now attaches or at any time
hereafter under any condition shall attach to Lessor for payment of any
amounts payable under this Lease or for the performance of any obligation
under this Lease. The exclusive remedies of Lessee for the failure of
Lessor to perform any of its obligations under this Lease shall be to
proceed against the interests of Lessor in and to the Equipment. This Lease
shall be non-recourse to Lessor.
12.11 BROKERAGE COMMISSIONS. Lessor and Lessee represent to each other
that they have acted directly and independently with the other as principals
and that neither Lessor nor Lessee have retained or authorized the services
of any broker, real estate agent or finder with respect this Lease. Lessee
agrees to indemnify and hold Lessor harmless from and against any and all
claims, liabilities and obligations for any commission, finder's fee or any
other compensation in connection with this Lease claimed by or through
Lessee. Lessor agrees to indemnify and hold Lessee harmless from and
against any and all claims, liabilities and obligations for any commission,
finder's fee or other compensation in connection with this Lease claimed by
or through Lessor. These mutual indemnifications shall survive expiration
or termination of this Lease for any reason.
12.12 SUBORDINATION/ESTOPPEL CERTIFICATE. The rights and interest of
Lessee under this Lease in and to the Equipment shall be subject and
subordinate to any first deeds of trust, mortgages, and other security
instruments and to all renewals, modifications, consolidations, replacements
and extensions thereof ("Security Documents") heretofore or hereafter
executed by Lessor covering the Equipment or any parts thereof, to the same
extent as if the Security Documents had been executed, delivered and
recorded prior to the execution of this Lease. After the delivery to Lessee
of a notice from Lessor that it has entered into one or more Security
Documents, then during the term of such Security Documents Lessee shall
deliver the holder or holders of all Security Documents a copy of all
notices to Lessor and shall grant to such holder or holders the right to
cure all defaults, if any, of Lessor hereunder within the same time period
provided in the Lease for such defaults by Lessor and, except with the prior
written consent of the holder or holders of the Security Documents, shall
not (i) amend this Lease, (ii) surrender or terminate this Lease except
pursuant to a right to terminate expressly set forth in this Lease, or (iii)
pay any rent more than one (1) month in advance or pay any Rent or other
amounts payable hereunder other than in strict accordance with the terms
hereof. The provisions of this Section 12.12 shall be self-operative and
shall not require further agreement by Lessee; provided, however, at the
request of Lessor, Lessee shall execute such further documents as may be
reasonably required to evidence and set forth for the benefit of the holder
of any Security Documents the obligations of Lessee hereunder.
Contemporaneous with obtaining any such financings, Lessor shall use
reasonable efforts to obtain a non-disturbance agreement with any lender
providing Lessee the right to continue to occupy the Equipment pursuant to
the terms of this Lease so long as no Event of Default exists. At any time
and from time to time upon not less than ten (10) days' prior notice by
Lessor, Lessee shall execute, acknowledge and deliver to Lessor a statement
in writing certifying that this Lease is unmodified and in full force and
effect (or expressly stating any such modifications and that the same are in
full force and effect has
<PAGE>
modified), and stating to Lessee's knowledge, whether or not the Lessor or
Lessee is in default under the terms and provisions of this Lease, and if
so, specifying any such claimed default, it being intended that any such
statement may be relied upon by any prospective purchaser, tenant, mortgagee
or assignee of any mortgage relating to the Equipment or the Lessor's
interest therein.
12.13 FURTHER ASSURANCES. Lessor and Lessee agree to take such further
action and execute such documents and instruments as may be reasonably
required in order to more effectively carry out the terms of this Lease and
the intention of the parties.
IN WITNESS WHEREOF, this Lease is hereby executed as of the date first
above set forth.
LESSOR:
FARM FISH, INC.
By: /S/ DAVE ROBISON
Name: Dave Robison
Title: Vice President
LESSEE:
H & S FISH FARMS, INC.
By: /S/ WALTER WILLIAM HEIGLE III
Name: Walter William Heigle III
Title: President
<PAGE>
H & S Fish Farm
Equipment List
1995 Chev 1GBHC34KX5E179617 Brown Feed Truck$10,000 each
1992 Chev 2GCFC19K9N1190027 Red Ex. Cab Truck$ 7,000 each
1989 Chev 1GCDC14K1KE159674 Red & White $ 2,000 each
1990 Chev 1GTDC14KXL7544841 Blue $ 2,000 each
#31 Case B510231B018041 685 Tractor $ 4,000 each
#32 Case 351350RTW 685 Tractor $ 4,000 each
#33 Case B510231B018436 685 Tractor $ 4,000 each
#34 Case B510231B018414 685 Tractor $ 4,000 each
J D 4210RNCJJE09048601 4210 Tractor $11,000 each
Case JJE0033889 895 Tractor $ 5,500 each
Case JJE0008298 895 Tractor $ 5,500 each
J D 016319R 4240 Tractor $ 7,500 each
12 Master Systems 10 Hp Paddle Wheels $ 1,000 each
4 S & N 10 Hp Paddle Wheels $ 1,250 each
9 House 10 Hp Paddle Wheels $ 400 each
5 Shop Made Sidewinder Paddle Wheels $ 300 each
All equipment listed above will be turned over now
At close they will receive 5 Shop Made Sidewinder
Paddle Wheels $ 300 each
<PAGE>
EXHIBIT 1.3 -SECURITY DOCUMENTS
Promissory Note
Deed of Trust and Security Agreement
Opinion Letter from Borrower's counsel
UCC-1 Financing Statement
Mortgagee Title Policy (to be provided at closing)
<PAGE>
Prepared by:
Forman, Perry, Watkins, Krutz & Tardy, PLLC
Attn: Steven M. Hendrix
12th Floor, One Jackson Place
Post Office Box 22608
Jackson, MS 39225-2608
(601) 960-8603
Indexing Instructions:
To the Chancery Clerk of Humphreys County, Mississippi:
The real property described herein is situated in the ____________ Quarter
of Section ___, Township _________, Range _______ of Humphreys County,
Mississippi.
DEED OF TRUST AND SECURITY AGREEMENT
WHEREAS, H & S Fish Farms, Inc., a Mississippi corporation ("Grantor"),
is indebted to Farm Fish, Inc., a Mississippi corporation ("Beneficiary"),
as evidenced by that certain Promissory Note by Grantor as Maker of even
date herewith ("Note"), payable to the Beneficiary or to its order in the
principal amount of up to One Million Five Hundred Thousand and no/100
dollars ($1,500,000), together with interest thereon, with final payment
being due on or before ______, 2010.
NOW THEREFORE, KNOW ALL MEN, that the Grantor, in consideration of said
debt and for other good and valuable consideration, receipt of which is
hereby acknowledged, hereby grants, bargains, assigns, sells, conveys and
warrants unto Steven M. Hendrix, an individual resident of the State of
Mississippi (the "Trustee"), as Trustee for the benefit of the Beneficiary,
all estate, right, title and interest of Grantor now owned or hereafter
acquired in and to the following described real and personal property, with
power of sale and right of entry and possession (hereinafter collectively
referred to as the "Property");
A. LAND:
That certain parcel or lot of land located in Humphreys County,
Mississippi which is more particularly described on EXHIBIT A attached
hereto and incorporated herein by reference (the "Land") and all right,
title and interest conveyed by Beneficiary to Grantor by that certain
Special Warranty Deed of even date herewith relating to the Land.
B. IMPROVEMENTS:
All buildings and other improvements now located or hereafter erected
on the Land or added thereto, together with all fixtures now or hereafter
owned by the Grantor, or in which the Grantor has any interest, leasehold or
otherwise, and placed in or upon the Land or the buildings or other
improvements thereon (collectively, the "Improvements").
C. EASEMENTS:
All easements, bridges, rights of way, licenses, privileges,
hereditaments and
<PAGE>
appurtenances belonging to or inuring to the benefit of the Land; all
right, title and interest of the Grantor in and to the land lying within any
street or roadway adjoining the Land; and all right, title and interest of
the Grantor in and to any vacated or hereafter vacated streets or roads
adjoining the Land (collectively, the "Easements").
D. PERSONAL PROPERTY:
All fixtures, machinery, equipment and other personal property of every
kind, description and nature whatsoever, now or hereafter located in or upon
or affixed to the Land or Improvements, or any part thereof, or now or
hereafter used or to be used in connection with any present or future
operation thereof or construction thereon, and now owned or hereafter
acquired by the Grantor, including, without in any way limiting the
generality of the foregoing: any and all (i) heating, lighting,
incinerating, refrigerating, ventilating, air conditioning, air cooling,
lifting, fire extinguishing, plumbing, cleaning, communications and power
equipment and apparatus; (ii) gas, water and electrical equipment and
apparatus; and (iii) tractors, farming equipment, engines, pumps, motors,
tanks, pumps, partitions, conduits, ducts and compressors, together with any
renewals, replacements or additions of or to any of the above or
substitutions therefor; it being understood and agreed that all such
fixtures, machinery, apparatus, equipment and other personal property are a
part of and are declared to be a portion of the security for the
indebtedness hereby secured, whether physically attached to the Improvements
or not (collectively, the "Personal Property").
E. LEASES AND RENTS:
All of the landlord's right, title and interest, owned by the Grantor,
in and to all leases (which term, as used herein, shall include all
occupancy agreements, licenses, concession agreements and all other
agreements or tenancies, however denominated, affecting the occupancy of the
Property, or any portion thereof) now or hereafter affecting or pertaining
to the Property and the business operations conducted thereon, together with
all of the rents, issues, benefits and profits derived from or relating to
the Property (collectively, the "Operating Leases").
F. RECORDS:
A security interest in and to all of the records and books of account
now or hereafter maintained by the Grantor in connection with the operation
of the Property.
<PAGE>
G. NAME AND GOODWILL:
The right, if any, in the event of foreclosure hereunder of the
Property, to take and use any name under which the Property is then being
operated (alone or in any variation thereof or in combination with other
words), together with the goodwill of the Grantor in connection therewith.
H. PROCEEDS AWARDS AND OTHER MONEYS:
A security interest in all proceeds paid for any damage or loss to the
Property or any part thereof, all award and insurance claims, including
interest, in connection with any condemnation or other taking of the
Property, or any part thereof, or for conveyance in lieu thereof, and all
other moneys which may from time to time become subject to the lien hereof,
whether by conversion, voluntary or involuntary, of any of the foregoing
into cash or liquidated claims or otherwise (collectively, the "Proceeds").
I. REPLACEMENTS AND SUBSTITUTIONS:
All of the Grantor's right, title and interest in and to all
replacements, substitutions, additions and proceeds of or to any or all of
the foregoing.
TO HAVE AND TO HOLD unto the Trustee in trust for the use, benefit and
behalf of the Beneficiary, forever.
SUBJECT, HOWEVER, to those certain liens, encumbrances and other
matters set forth on EXHIBIT B attached hereto and made a part hereof
(collectively, the "Permitted Exceptions").
This conveyance is made to secure:
(i) Payment of the indebtedness of the Grantor to the Beneficiary
evidenced by that certain Asset Purchase Agreement between Grantor as Buyer
and Beneficiary as Seller dated July __, 2000 ("Purchase Agreement") and the
Note, together with interest on said indebtedness at the rate specified
therein, or any other promissory note made and delivered by the Grantor to
the Beneficiary in substitution, extension or replacement therefor, whether
of the same amount or otherwise, which Purchase Agreement, Note and any
substitute, extension or replacement note or notes and any amendment or
modification thereof from time to time shall be hereinafter referred to as
the "Obligations";
(ii) Payment, performance and observance by the Grantor of each and
every covenant, condition and obligation contained in the Obligations, this
Deed of Trust and/or any other document or instrument now or hereafter
evidencing or securing the indebtedness evidenced by the Obligations, or
executed or delivered in connection therewith (all of such documents and
<PAGE>
instruments, as amended, modified and supplemented from time to time, being
hereinafter collectively referred to as the "Loan Documents");
(iii) Payment, performance and observance by the Grantor of each and
every covenant, condition and obligation contained in the Purchase Agreement
and all Operating Leases; and
(iv) Payment by the Grantor to the Beneficiary of all future or
additional advances which the Beneficiary may make to the Grantor from time
to time pursuant to any term or provision of this Deed of Trust or with
respect to the Obligations, the Operating Leases or the Loan Documents.
The Grantor warrants that the Grantor has good and marketable title to
the Property, and is lawfully seized and possessed of the Property and every
part thereof, and has the right to convey and encumber the same; the
Property is unencumbered except for the Permitted Exceptions; and the
Grantor will forever warrant and defend the title to the Property unto the
Trustee and the Beneficiary against the claims of all persons whomsoever
except as to the Permitted Exceptions.
This Deed of Trust is a deed of trust and security agreement pursuant
to the laws of the State of Mississippi governing deeds of trust and
security agreements and is not a mortgage.
The Grantor hereby further covenants and agrees with the Beneficiary to
pay, perform or observe, as the case may be, all of the following additional
covenants and agreements:
ARTICLE 1
PERFORMANCE OF OBLIGATIONS
1.1 The Grantor shall pay all indebtedness hereby secured at the time
or times and in the manner provided herein or in the Obligations, and shall
pay, as and when the same respectively become due and payable, all premiums
for insurance maintained on the Property and all reasonable expenses of
repair to the Property.
1.2 The Grantor shall promptly and fully keep, perform and comply with
all the terms, provisions, covenants and conditions imposed upon the Grantor
hereunder, under the Obligations, the Purchase Agreement, the Operating
Leases and/or under any of the other Loan Documents.
1.3 The Grantor shall promptly:
(i) perform and observe all of the covenants and agreements
required to be performed and observed by the Grantor under the
Purchase Agreement and do all things necessary to preserve and to
keep unimpaired its rights thereunder; and
<PAGE>
(ii) notify the Beneficiary of any default by the Grantor under
the Purchase Agreement or the Loan Documents in the performance or
observance of any of the covenants or agreements on the part of
the Grantor to be performed or observed thereunder.
1.4 Grantor warrants and agrees that there is no prior mortgage, deed
of trust, financing statement, security agreement, encumbrance, lien or any
other document covering the Property, or any part thereof, on file, recorded
or in effect in any public office except as set forth in EXHIBIT B and
agrees that the Property shall be kept free from any other lien, security
interest or encumbrance except as expressly permitted hereunder.
1.5 Grantor shall give the Beneficiary prompt notice of the
commencement of any pending or threatened litigation, arbitration or
appraisal proceeding relating to the Property. The Beneficiary shall have
the right to intervene and participate in any such proceeding and the
Grantor shall confer with the Beneficiary and its attorneys and experts and
cooperate with them to the extent the Beneficiary deems reasonably necessary
for the protection of the Beneficiary. Upon the request of the Beneficiary,
the Grantor shall exercise all rights of arbitration or appraisal conferred
upon it. If at any time any such proceeding shall be commenced, the Grantor
shall be in default in the performance or observance of any covenant or
agreement contained in the Loan Documents, on the part of the Grantor to be
performed or observed, beyond any applicable grace period, the Beneficiary
shall have, and is hereby granted, the sole and exclusive right to designate
and appoint on behalf of the Grantor the arbitrator(s) or appraiser(s) in
such proceeding.
1.6 Grantor shall appear in and defend any action or proceeding
affecting or purporting to affect the security of this Deed of Trust, any
additional or other security for any of the Obligations secured hereby, or
the interest, rights, powers or duties of the Trustee or Beneficiary created
hereunder; it being agreed, however, that in the case of an action or
proceeding against the Trustee or Beneficiary, the Trustee or Beneficiary,
at their option, may appear in and defend any such action or proceeding; it
being further agreed that the Trustee may commence any action or proceeding
deemed necessary by him to perfect, maintain or protect such interest,
rights, powers or duties, all in such manner and to such extent as seen fit,
and, after reasonable notice to Grantor and the failure of Grantor to fully
comply therewith, the Trustee is authorized to pay, purchase or compromise
on behalf of Grantor any encumbrance or claim which in his reasonable
judgment appears or purports to affect the security hereof or to be superior
hereto, and to pay all costs and expenses, including costs of evidence of
title and attorneys' fees in a reasonable sum, in any above-described action
or proceeding in which Beneficiary or the Trustee may appear.
1.7 Without affecting the liability of any other person liable for the
payment of the Obligations and without affecting the lien or charge of this
Deed of Trust upon any property not then or theretofore released as security
for the full amount of the Obligations, the Trustee may, upon written
request by Beneficiary, from time to time, and without notice to Grantor,
<PAGE>
release any person or guarantor, if any, extend the maturity or alter any
of the terms of any such obligation or grant other indulgences, release or
reconvey, or cause to be released or reconveyed, any portion or all of the
Property described herein, take or release any other or additional security
for any obligation herein mentioned, or make compromises or other
arrangements with persons in relation thereto; and if the Trustee at any
time holds any additional security for any obligations secured hereby, he
may enforce the sale thereof or otherwise realize upon the same at his
option, either before or concurrently herewith or after a sale is made
hereunder.
1.8 Grantor shall at all times maintain a net worth or
shareholder's equity in an amount of at least $300,000.00 determined in
accordance with generally accepted accounting principles applied on a
consistent basis.
ARTICLE 2
WARRANTIES AND REPRESENTATIONS
Grantor hereby warrants and represents to Beneficiary that;
2.1 The execution delivery and performance by Grantor of this Deed of
Trust will not violate, be in conflict with, result in a breach of or
constitute (with due notice or lapse of time, or both) a default under any
Legal Requirement or result in the creation or imposition of any lien,
charge or encumbrance of any nature whatsoever upon the Property, except as
contemplated by the provisions of this Deed of Trust. This Deed of Trust
constitutes the legal, valid and binding obligations of Grantor, and Grantor
has full and lawful authority to bargain, grant, sell, mortgage, assign,
transfer and convey all of the Property. Grantor is a Mississippi
corporation, duly organized, validly existing and in good standing in the
laws of the State of Mississippi. Grantor has full corporate authority and
power to execute and deliver the Loan Documents, and perform the obligations
thereunder. The Loan Documents were duly authorized, executed, and
delivered by Grantor, with power requisite for corporate actions, and are
valid and binding obligations of Grantor, and enforceable in accordance with
their respective terms.
2.2 Grantor has good and indefeasible fee simple title to the Land and
the Improvements, and good and indefeasible title to the Fixtures and
Personalty, Leases and Rents, if any, free and clear of any liens, charges,
encumbrances, security interests and adverse claims whatsoever, except only
to the express limited extent of the Permitted Encumbrances. This Deed of
Trust, when filed, constitutes a valid, subsisting, first and prior lien
deed of trust on the Land, Improvements and Fixtures and a valid, subsisting
prior security interest in and to the Personalty, Leases and Rents, all in
accordance with the terms hereof, subject to the Permitted Encumbrances.
2.3 Grantor has filed all federal, state, county, municipal and city
income and other tax returns required to have been filed, and paid all tax
returns required to have been filed by
<PAGE>
them and paid all taxes which have become due pursuant to such returns or
pursuant to any assessments received by it, and Grantor does not know of any
basis for any additional assessment in respect of any such taxes. Grantor
has paid, or will pay in full (except for such retainages as may be
permitted or required by any Legal Requirements to be withheld by Grantor
pending completion of the Improvements), all sums owing, if any, or claimed
for labor, material, supplies, personal property (whether or not
constituting a Fixture hereunder) and services of every kind and character
used, furnished or installed in the Property and no claim for same currently
exists or will be permitted to become past due.
2.4 There are no actions, suits or proceedings pending or, threatened
against or affecting Grantor, the Property involving the validity or
enforceability of this Deed of Trust or the priority of the lien and
security interest hereof, and no event has occurred which will violate, be
in conflict with, result in the breach of, or constitute (with due notice or
lapse of time, or both) a default under any Legal Requirement or result in
the creation or imposition of any lien, charge or encumbrance of any nature
whatsoever upon the Property other than the lien and security interests
created by the Loan Documents.
ARTICLE 3
ASSIGNMENT OF CONTRACTS, LEASES, RENTS AND PERMITS
3.1 The Grantor, as additional security, hereby assigns, sets over and
transfers to the Beneficiary all leases, licenses, delivery rights,
processing or concession agreements, and all other tenancy agreements and
all of the rents, issues and profits relating to the Property.
3.2 The Grantor, as additional security, hereby assigns, sets over and
transfers to the Beneficiary all licenses, permits and all other public or
governmental approvals necessary to operate the Property for its intended
use.
ARTICLE 4
INSURANCE
4.1 The Grantor shall keep the Improvements constantly and
satisfactorily insured against loss by fire, earthquake, flood (if
applicable and available) and the risks covered under an "all risks" policy,
including Extended Coverage and Special Extended Coverage Endorsements, and
against explosion of boilers, heating apparatus and other pressure vessels,
and such other hazards, casualties and contingencies as the Beneficiary
shall from time to time require, in an amount not less than one hundred
percent (100%) of the replacement cost of the Improvements (and the contents
thereof, to the extent owned by the Grantor), and in any event in an amount
sufficient to prevent the Grantor from being a co-insurer with respect to
any loss, said coverage to be endorsed with a Replacement Cost Endorsement
(the amount to be reviewed annually and increased if necessary so as to
provide coverage at all times in an amount necessary to restore the
Improvements (and contents) to the condition existing just prior to
destruction or damage).
<PAGE>
4.2 The Grantor, during the term of this Deed of Trust, agrees to keep
in force and effect a policy of comprehensive public liability insurance and
(if relevant) elevator insurance, against claims for bodily injury, death or
property damage occurring upon, in or about the Improvements, or any vault
space or sidewalk adjoining the Property or any area or passageway adjacent
to the Property under the control of the Grantor, in which the primary
limits of liability for personal injury shall not be less than Five Hundred
Thousand Dollars ($500,000) per person and One Million Five Hundred Thousand
Dollars ($1,500,000) per occurrence and in which the primary limits of
liability for property damage shall not be less than Five Hundred Thousand
Dollars ($500,000) per occurrence with "Umbrella" coverage of One Million
Five Hundred Thousand Dollars ($1,500,000) aggregate per policy per year.
The Grantor agrees to increase the limits of such liability insurance to
such higher amounts as the Beneficiary may from time to time reasonably
require.
4.3 All such insurance shall be evidenced by valid and enforceable
policies in form and substance acceptable to the Beneficiary and shall be
made payable to the Beneficiary by means of a standard noncontributory
mortgagee clause in favor of and in form acceptable to the Beneficiary, and
in the case of liability coverage, shall name the Beneficiary as additional
insured. Either the originals of all such policies or a certificate from the
insurer setting forth the limits of the insurance coverage (to which
certificate shall be attached a copy of the appropriate policy or policies)
shall be delivered to the Beneficiary concurrently with the execution and
delivery of this Deed of Trust, and thereafter all renewal or replacement
policies shall be delivered to the Beneficiary not less than twenty (20)
days prior to the expiration date of the policy to be renewed or replaced,
accompanied, if requested by the Beneficiary, by evidence satisfactory to
the Beneficiary that all premiums payable with respect to such policies have
been paid in full by the Grantor.
4.4 All such insurance policies shall (i) contain an endorsement
requiring thirty (30) days written notice to the Beneficiary prior to
cancellation or change in the coverage, scope or amount of any such policy
or policies, and (ii) provide that any loss shall be payable to the
Beneficiary notwithstanding any act or negligence of the Grantor which might
otherwise result in a forfeiture of said insurance.
4.5 The Grantor may effect for the Grantor's own account any insurance
not required under the provisions of this Deed of Trust, but any insurance
effected by the Grantor on the Property, whether or not required under this
Deed of Trust, shall be subject to all other provisions of this Deed of
Trust.
4.6 The Grantor shall have the right of free choice in the selection
of the agent or insurer through or by which the insurance required hereunder
is to be placed; PROVIDED, HOWEVER, said insurer is authorized to write such
insurance in the State of Mississippi, has a licensed resident agent in said
State and has, at all times while this Deed of Trust is in effect, a general
policyholder's rating of A or A+ in Best's latest rating guide. Such
insurance shall not
<PAGE>
be "blanketed" with any insurance on property other than the Property
without the consent of the Beneficiary, which consent shall not be
unreasonably withheld, conditioned or delayed.
4.7 The Beneficiary shall have the right and is hereby irrevocably
constituted and appointed the true and lawful attorney in fact of the
Grantor, coupled with an interest and with full power of substitution,
delegation and revocation, in the name and stead of the Grantor, but in the
uncontrolled discretion of said attorney, (i) to demand, adjust, sue for,
compromise and collect any amounts due under such insurance policies in the
event of loss, and (ii) to give releases for any and all amounts received in
settlement of losses under such policies.
4.8 Any amounts so received shall, at the Beneficiary's option, be
applied, after first deducting the costs of collection, to the payment of
the indebtedness secured hereby, whether or not then due, or to
reimbursement of any taxes, payments in lieu of taxes, assessments, charges,
insurance premiums or other obligations paid by the Beneficiary pursuant
hereto, or, notwithstanding the claims of any subsequent lienor, amounts so
received with respect to casualty loss may be used or paid over to the
Grantor for use in repairing or replacing damaged buildings and improvements
on the Property. If the Beneficiary elects to permit the use of casualty
insurance proceeds for repair and replacement of damaged buildings and
improvements (and, except in the last year of the term of the Obligations,
when no such election shall be required of the Beneficiary, the Beneficiary
shall so elect if no Event of Default then exists hereunder unless the
Beneficiary, in the Beneficiary's reasonable discretion, determines that
such repair and replacement would materially jeopardize the value of the
Beneficiary's Deed of Trust lien or security interest hereunder), then the
amounts payable to the Beneficiary pursuant to this Article, or so much
thereof as may be required for such purpose, shall be paid out from time to
time as the work of repair or replacement progresses, upon such architects'
certificates or other certificates, including certificates from title
insurance companies, as the Beneficiary may from time to time require, with
respect to the cost of such repair or replacement and the status of title to
the Property: PROVIDED, HOWEVER, the Beneficiary shall not be required to
release or pay any portion of such proceeds unless (i) the Grantor shall
first furnish additional funds, if necessary, from sources other than the
net amount of such proceeds which, together with said proceeds, shall be
sufficient to cover the cost of repair or replacement as established by the
certificate of an architect or engineer employed by the Grantor and approved
by the Beneficiary at the Grantor's expense; (ii) in the determination of
the architect or engineer so employed, such repair or replacement may be
effected within a period of six (6) months or less; and (iii) such repair or
replacement shall be effected promptly and in accordance with plans and
specifications submitted to and approved by the Beneficiary (which approval
shall not be unreasonably withheld, conditioned or delayed) and diligently
pursued to completion. The Beneficiary shall at no time whatever, whether in
possession of the Property or not, have any obligation to advance or make
funds other than said proceeds available for the repair or replacement of
the Property.
ARTICLE 5
PAYMENT OF TAXES
<PAGE>
5.1 The Grantor shall promptly pay, at least ten (10) days before they
are due, all taxes, assessments, water and sewer charges and all other
charges of whatever nature which may at any time be assessed against, levied
upon or constitute a lien on, the whole or any portion of the Property and
any tax assessed against the Beneficiary with respect to this Deed of Trust
or the indebtedness hereby secured, whether under statutes now in force or
that may hereafter be enacted; and the Grantor shall promptly pay, when due,
all other taxes (including corporate taxes, personal property taxes and
payments in lieu of taxes), assessments or charges that might become a lien
prior to this Deed of Trust or that might have priority in distribution of
the proceeds of a judicial sale.
5.2 Upon (i) the passage of any law imposing the payment of all or any
part of the foregoing upon the Beneficiary, (ii) the rendering of a decision
by any appellate court of competent jurisdiction that the undertaking by the
Grantor or any similar undertaking to pay such taxes, assessments and/or
charges is legally inoperative or (iii) the changing in any way of the laws
concerning the taxation of deeds of trust or debts secured by deeds of trust
for state or local purposes or the manner of the collection of any such
taxes, so as to detrimentally affect the Beneficiary or the validity or
priority of this Deed of Trust, then the indebtedness hereby secured without
deduction shall, at the option of the Beneficiary, upon thirty (30) days'
written notice to the Grantor, become immediately due and payable,
notwithstanding anything contained in this Deed of Trust or any law
heretofore or hereafter enacted; PROVIDED, HOWEVER, in the case of (i) above
that if in the opinion of the Beneficiary's counsel it be lawful in all
respects for the Grantor to pay such taxes, assessments or charges imposed
under any such future law or reimburse the Beneficiary therefor (and the
same will not amount to an exaction of interest in excess of the highest
rate permitted by law) and the Grantor lawfully makes payment thereof or
reimburses the Beneficiary therefor, then the unpaid balance of the
indebtedness hereby secured shall not be so accelerated on account of the
matters hereinabove set forth. The Grantor shall not suffer or permit any
such taxes, assessments or charges on the Property to become or remain
delinquent or permit any part thereof or any interest therein to be sold for
any such taxes, assessments or charges; and further shall furnish to the
Beneficiary, in each instance prior to the date when they would become
delinquent, certificates or receipts of the proper officer showing full
payment of all taxes, assessments and charges.
5.3 Notwithstanding the foregoing provisions of this Article, the
Grantor shall not be required to pay and discharge or cause to be paid and
discharged any such tax, assessment or charge so long as the validity
thereof shall be contested diligently and in good faith by appropriate
proceedings and with counsel reasonably satisfactory to the Beneficiary, and
so long as the Grantor shall at all times have deposited with the
Beneficiary, or posted a bond satisfactory to the Beneficiary in, a sum
equal to the amount being so contested (including the amount of any fine,
penalty, further interest or cost that may become due thereon during such
contest); PROVIDED, HOWEVER, that payment in full with respect to any such
tax, assessment or charge shall be made not less than twenty (20) days
before the first date upon which the Property, or any portion thereof, may
be seized and sold in satisfaction thereof.
<PAGE>
ARTICLE 6
PAYMENT OF LIENS
6.1 The Grantor shall pay, when the same shall become due and payable,
all lawful claims and demands of mechanics, materialmen, laborers and others
which, if unpaid, might result in or permit the creation of a lien on the
Property or any part thereof.
6.2 Notwithstanding the foregoing provisions of this Article, the
Grantor shall not be required to pay and discharge or cause to be paid and
discharged any such claim so long as the validity thereof shall be contested
diligently and in good faith by appropriate proceedings and with counsel
reasonably satisfactory to the Beneficiary, and so long as the Grantor shall
at all times have deposited with the Beneficiary, or posted a bond
satisfactory to the Beneficiary in, a sum equal to the amount being so
contested (including the amount of any fine, penalty, further interest or
cost that may become due thereon during such contest); PROVIDED, HOWEVER,
that payment in full with respect to any such claim shall be made not less
than twenty (20) days before the first date upon which the Property, or any
portion thereof, may be seized and sold in satisfaction thereof.
ARTICLE 7
BENEFICIARY'S RIGHT TO PAY INSURANCE CHARGES, TAXES AND LIENS
If the Grantor fails to insure the Property, or to pay and furnish
receipts for all taxes, assessments and other charges, or to pay for all
labor and materials, all as provided herein, the Beneficiary may, at the
Beneficiary's option and upon ten (10) days written notice to the Grantor
(or upon such lesser notice, or without notice, if the Beneficiary deems
that the same is required to protect the Beneficiary's interest in the
Property): procure such insurance; pay such taxes, assessments and charges
and any penalty and interest thereon; redeem the Property or any part
thereof from any tax sale or procure such receipts; and/or pay for such
labor and materials; and the Grantor shall immediately pay to the
Beneficiary all sums which the Beneficiary shall have so paid, together with
interest thereon at the highest rate then prevailing under the terms of the
Obligations for overdue payments of principal from the date the same was
paid, and for payment thereof, this Deed of Trust shall stand as security in
like manner and effect as for the payment of the indebtedness evidenced by
the Obligations. The failure of the Beneficiary to procure such insurance,
to pay such taxes, assessments and charges, to redeem the Property or any
part thereof from any tax sale, and/or to pay for labor and materials, shall
in no way render the Beneficiary liable to the Grantor. If the Beneficiary
shall elect to advance insurance premiums, taxes, assessments or charges,
redeem from tax sale, and/or pay for labor or materials, the receipt of the
insurance company, the proper tax official or supplier shall, in the absence
of manifest error, be conclusive evidence of the amount, validity and the
fact of payment thereof.
ARTICLE 8
<PAGE>
INSURANCE AND TAX DEPOSITS
The Beneficiary may, at any time, upon ten (10) days written notice to
the Grantor, require the Grantor to pay to the Beneficiary funds sufficient
to pay the aforesaid taxes, assessments, water and sewer charges and all
other charges upon the Property in full when due and require payment on the
first day of each calendar month a sum (hereinafter referred to as the
"DEPOSITED FUNDS") equal to (i) one-twelfth (1/12) of the aforesaid annual
taxes, assessments, water and sewer charges and all other charges upon the
Property and/or upon the Beneficiary with respect to the Property (for the
purposes of this Article, collectively referred to as the "taxes") and (ii)
one twelfth (1/12) of the annual premiums for the insurance required
hereunder to be maintained on the Property, the respective amounts of such
taxes and premiums to be reasonably estimated from time to time by the
Beneficiary. The Beneficiary shall apply the Deposited Funds to the payment
of such taxes and premiums and shall render an annual accounting to the
Grantor of all disbursements of the Deposited Funds. Although each such
monthly payment of the Deposited Funds is to be in a lump sum, each
component thereof shall be deemed to be held separately by the Beneficiary
for, and shall be applied only to, the particular item for which it was paid
over by the Grantor, unless the Beneficiary, in the Beneficiary's sole
discretion, elects otherwise. If at any time prior to the due date of any
particular item for which funds are deposited hereunder, the Beneficiary
reasonably estimates that there shall not be deposited with the Beneficiary
one month prior to such due date a sum sufficient for the payment of such
item in full, the Grantor shall, upon demand, pay the amount of such
deficiency to the Beneficiary notwithstanding that there may already be
deposited with the Beneficiary sums for the payment of other items which are
not yet due. If the amount of the Deposited Funds shall exceed the amount
necessary to pay such taxes and premiums for the then current year, such
excess shall be credited against future monthly deposits required hereunder.
No interest shall be paid on the Deposited Funds, and the Deposited Funds
may be commingled with the Beneficiary's general funds. Upon payment in full
of all sums secured by this Deed of Trust, any excess Deposited Funds shall
be refunded to the Grantor. Upon the occurrence of an Event of Default
hereunder, the Beneficiary may apply against the indebtedness secured
hereby, in such manner as the Beneficiary may determine, any of the
Deposited Funds then held by the Beneficiary.
ARTICLE 9
MAINTENANCE AND REPAIR
9.1 The Grantor shall at all times keep and maintain the Property,
including all Improvements and Personal Property now or hereafter installed
or located thereon or used in connection therewith, in sound condition and
repair, including, without limitation, the ponds and levee system. The
Personal Property only is subject to ordinary wear and tear.
9.2 The Grantor shall not: permit any strip or waste of the Property;
permit any impairment or deterioration of the Property other than ordinary
wear and tear; permit the violation of any law, ordinance or governmental
regulation affecting the same or the use
<PAGE>
thereof; permit any conditions to exist which would wholly or partially
invalidate any insurance on the Property; or permit anything to be done to
the Property that might materially diminish the value thereof.
9.3 Upon prior reasonable notice, the Grantor shall permit the
Beneficiary, and the Beneficiary's officers, agents and servants, reasonable
access to the Property at all reasonable times to view and inspect the same.
9.4 The Grantor shall, within thirty (30) days after demand by the
Beneficiary (or immediately upon demand in case of emergency), make such
repairs, replacements, renewals or additions, or perform such items of
maintenance to the Property as the Beneficiary may reasonably require in
order to maintain the Property at the standards required by this Article;
PROVIDED, HOWEVER, that if such required action cannot reasonably be
completed within the time herein provided, then if the Grantor shall so
notify the Beneficiary and immediately commence and carry out such action in
a prompt and diligent manner, the time for completion thereof shall be
extended to the period of time necessary to complete the same in a prompt
and diligent manner.
ARTICLE 10
BOOKS AND RECORDS
10.1 Grantor shall maintain full and accurate books of account and
other records reflecting the results of its operations, and will furnish, or
cause to be furnished to Beneficiary, on or before ninety (90) days after
the end of each calendar year: (a) a certified statement of Grantor's
assets and liabilities; and (b) an operating statement, in such detail as
Beneficiary may reasonably require, which accurately, fairly and separately
presents Grantor's books of account and records relating to the Property,
including, but not limited to, a detailed current rent roll, and gross
income and expenses, all of which shall be maintained and made available to
Beneficiary and Beneficiary's representatives upon request for such purpose
on the Property, or at such other location as Beneficiary may approve. All
prepared in accordance with generally accepted accounting principles applied
on a consistent basis. Grantor shall also furnish to Beneficiary, and
Beneficiary shall be entitled to receive from Grantor, upon request, such
other financial information relating to Grantor and/or the Property as
Beneficiary may reasonably request from time to time.
ARTICLE 11
CONDEMNATION
11.1 Forthwith upon the receipt by the Grantor of notice of the
initiation of any proceeding or negotiations for the taking of the Property,
or any part thereof, in condemnation or by the exercise of the power of
eminent domain, the Grantor shall give notice thereof to the Beneficiary.
The Beneficiary may appear in any such proceeding and participate in any
such negotiations and may be represented therein by counsel of the
Beneficiary's choice, all at the
<PAGE>
Grantor's cost and expense, and whether or not the Beneficiary shall become
a party to any such proceeding or negotiations, the Grantor shall promptly
give to the Beneficiary copies of all notices, pleadings, judgments,
determinations and other papers received by the Grantor therein. The Grantor
shall not enter into any agreement consenting to or acquiescing in the
taking of the Property, or any part thereof, by any governmental agency or
instrumentality, or other person or legal entity authorized to acquire the
same in condemnation or by eminent domain unless the Beneficiary shall have
first consented thereto in writing.
11.2 Any award whether paid as a result of a negotiated settlement or
judgment, shall be paid to the Beneficiary to the extent of the indebtedness
secured hereby (the Grantor hereby assigning such award to the Beneficiary),
and the Beneficiary is hereby irrevocably constituted and appointed the true
and lawful attorney in fact, coupled with an interest and with full power of
substitution, delegation, and revocation, of the Grantor for such purpose
and as such is duly authorized and empowered to collect and receive the
total amount of such award for the benefit of the Grantor, including
interest, and to give proper receipts and acquittances therefor.
11.3 If all or substantially all of the Property shall be taken by
condemnation or otherwise as a result of the exercise of such power, the
whole of the principal sum and accrued unpaid interest evidenced by the
Obligations and secured by this Deed of Trust, together with all other
amounts, if any, then secured hereby, shall forthwith become due and
payable, at the option of the Beneficiary, and all awards paid or payable to
the Grantor on account of such taking shall be applied to the payment and
discharge of the indebtedness secured hereby, such application to be in the
following order of priority: (i) payment of all amounts (except principal
and interest) due and payable hereunder or under any of the other Loan
Documents; (ii) payment of accrued interest under the Obligations; and (iii)
payment of unpaid principal under the Obligations. To the extent that such
award or awards exceed the amount required to pay in full the principal and
interest under the Obligations and all other sums and charges then secured
hereby, the Beneficiary shall pay over to the person or persons legally
entitled thereto the amount of such excess; PROVIDED, HOWEVER, that until
the actual vesting of title in the condemning authority in such proceeding
or pursuant to any agreement in lieu or in settlement thereof, the
obligations of the Grantor to perform the terms, covenants and conditions of
this Deed of Trust shall continue unimpaired. In no event shall the
Beneficiary be required to satisfy or discharge this Deed of Trust until the
principal, interest and all other sums and charges secured hereby are paid
in full.
11.4 In the event of a taking of less than all or substantially all of
the Property, in condemnation or by eminent domain, or by agreement or
conveyance in lieu thereof, all awards payable to the Grantor as a result of
such taking shall forthwith be paid to the Beneficiary, to be applied by the
Beneficiary as follows:
11.4.1 The Grantor shall promptly, at the Grantor's own expense,
repair, restore and alter the Property to the extent required as a result of
such taking, or any damage occasioned thereby, so that the Property shall
thereafter constitute a complete architectural
<PAGE>
unit. If such repair, restoration and alteration is commenced promptly, then
the award payable to the Beneficiary pursuant to this Section, or so much
thereof as may be required for such purpose, shall be paid out from time to
time as the work of restoration progresses upon such architects'
certificates or other certificates, including certificates from title
insurance companies, as the Beneficiary may from time to time reasonably
require with respect to the cost of such restoration and the status of title
to the Property; PROVIDED, HOWEVER, the Beneficiary shall not be required to
release or pay any portion of such award unless (i) the Grantor shall first
furnish additional funds, if necessary, from sources other than the net
proceeds of such awards which, together with said proceeds, shall be
sufficient to cover the cost of restoration as established by the
certificate of an architect or engineer employed by the Grantor and approved
by the Beneficiary at the Grantor's expense; (ii) in the determination of
the architect or engineer so employed, such restoration may be effected
within six (6) months and (iii) such restoration shall be effected promptly
and in accordance with plans and specifications submitted to and approved by
the Beneficiary, which approval shall not be unreasonably withheld,
conditioned or delayed, and diligently pursued to completion. The
Beneficiary shall at no time whatever, whether in possession of the Property
or not, have any obligation to advance or make funds other than said net
proceeds available for the restoration of the Property.
11.4.2 To the extent that the net proceeds of such awards exceed
the cost of repair or restoration, such excess shall be applied by the
Beneficiary in accordance with Section 14.3 hereof.
11.4.3 Anything to the contrary herein contained notwithstanding,
if (i) at any time, an Event of Default shall have occurred and then be
continuing, or (ii) the Grantor does not promptly commence and diligently
pursue any such repair or restoration to completion in accordance herewith,
the total amount of such award shall be applied in accordance with Section
11.3 hereof.
11.5 As used in this Article, taking of "all or substantially all" of
the Property shall mean a taking of so much as, in the reasonable
determination of the Beneficiary, leaves a balance which is not the economic
equivalent of the Property as it existed immediately prior to such taking.
ARTICLE 12
JUNIOR INDEBTEDNESS
12.1 Grantor will not, without the prior written consent of Beneficiary
and which consent may be withheld in its sole and absolute discretion,
create, place, suffer or permit to be created or placed or, through any act
or failure to act, acquiesce in the placing of or allow to remain, any
mortgage, pledge, lien (statutory, constitutional or contractual), security
interest, encumbrance or charge on, or conditional sale or other title
retention agreement, regardless of whether same are expressly subordinate to
the liens of the Loan Documents with
<PAGE>
respect to the Property. Grantor shall pay all indebtedness secured by any
deed of trust creating a junior and subordinate lien (if any) on the whole
or any part of the Property and perform all covenants, terms and conditions
contained in any such deed of trust on the part of the Grantor to be
performed and observed, all within the periods provided for payment,
performance and observance in any such deed of trust, thereby preventing an
event of default from occurring thereunder.
12.2 If the Grantor fails to pay an installment of principal or
interest or any other amount due on or under any indebtedness secured by a
junior and subordinate deed of trust on the Property when the same becomes
due and payable, the Beneficiary may pay the same, and the Grantor on demand
shall repay the amount so paid with interest at the highest rate then
prevailing under the terms of the Obligations for overdue payments of
principal, and the same shall be added to the indebtedness secured hereby.
ARTICLE 13
GOVERNMENT REGULATIONS
The Grantor shall promptly comply with all present and future laws,
ordinances, rules, regulations, directives and other requirements of all
governmental authorities whatsoever having jurisdiction over the Property or
the use or occupation thereof; PROVIDED, HOWEVER, that the Grantor may
postpone such compliance (provided such non-compliance shall not (i) subject
the Beneficiary to liability or criminal prosecution or any other penalty,
(ii) jeopardize the safety or condition of the Property, or (iii) constitute
a default by the Grantor under any lease, license, concession, occupancy or
other tenancy agreement) if and so long as the validity or legality of any
such governmental requirement shall be contested by the Grantor diligently
and in good faith by appropriate legal proceedings and with counsel
reasonably satisfactory to the Beneficiary, and so long as the Grantor shall
at all times have deposited with the Beneficiary, or posted a bond
satisfactory to the Beneficiary in, a sum equal to the liability, if any, in
question with respect to such requirement (including the amount of any fine,
penalty, further interest or cost that may become due thereon by reason of
such contest).
ARTICLE 14
TRANSFER OF INTEREST IN PROPERTY, THE GRANTOR, ETC.
Grantor shall not suffer or permit any sale, conveyance, mortgage,
pledge, hypothecation, encumbrance, lease, assignment or other transfer of
the Property or any portion thereof or any interest therein directly or
indirectly without in each instance obtaining the prior written consent of
the Beneficiary which may be withheld in its sole and absolute discretion.
Grantor shall not suffer or permit any sale, conveyance, mortgage, pledge,
hypothecation, encumbrance, lease, assignment or other transfer of more than
10% of the shareholder interests of Grantor, which shall not prevent a
transfer by a shareholder of Grantor of all or part of his interest in
Grantor to said shareholder's spouse, children or immediate family members
by a testamentary transfer or transfer to inter-vivos trust for the benefit
of such family members.
<PAGE>
ARTICLE 15
IMPAIRMENT OF DEED OF TRUST
The Grantor shall not do or suffer any act or thing to be done, or omit
to do any act or thing, if such act or thing, or such forbearance or
omission, would impair the security of the payment of the indebtedness
secured hereby or the lien of this Deed of Trust.
ARTICLE 16
COLLECTION COSTS
16.1 The Grantor agrees, by execution hereof, to pay all reasonable
costs, charges and expenses, including: (i) reasonable attorneys' fees and
expenses, heretofore or hereafter incurred by the Beneficiary in connection
with this Deed of Trust, the Obligations and the other Loan Documents and
any amendments or supplements hereto or thereto, and any other documents
executed herewith or pursuant hereto or any interpretation, enforcement or
other question arising under any such document or in connection with the
enforcement of the Beneficiary's rights hereunder or under the Obligations
or the other Loan Documents in the event of a default hereunder or
thereunder; (ii) reasonable fees and expenses of any architect, engineer or
other professional retained by the Beneficiary pursuant to the terms of this
Deed of Trust; and (iii) title examinations, title insurance premiums,
insurance premiums, recording costs and all other reasonable costs, charges
and expenses incurred in connection with the transactions contemplated
hereby, whether or not such are incurred directly by and/or solely for the
benefit of the Beneficiary.
16.2 Without limiting the generality of the foregoing, the Grantor
further agrees that in the event that the indebtedness secured by this Deed
of Trust, or any part thereof, is collected by suit or action, or this Deed
of Trust be foreclosed, or in the event said indebtedness or Deed of Trust
is put into the hands of an attorney for collection, suit, action or
foreclosure, or in the event of the foreclosure of any deed of trust prior
to or subsequent to this Deed of Trust, in which proceeding the Beneficiary
is made a party, or in the event of the bankruptcy of the Grantor, or an
assignment by the Grantor for the benefit of creditors, the Grantor, the
Grantor's successors or assigns, shall be chargeable with all costs of
collection, including reasonable attorneys' fees, and including reasonable
attorneys' fees for all appellate proceedings involved therein, which shall
be due and payable at once; the payment of which charges and fees, together
with all costs and expenses, shall be secured hereby, and may be recovered
in any suit or action hereupon or hereunder.
16.3 The Grantor shall pay any recording fee, documentary stamp,
intangible or transfer tax or any other fees or charges imposed by any
governmental authority with respect to the execution, recordation,
assignment or discharge of this Deed of Trust, the Obligations or the other
Loan Documents, or any other instrument executed and delivered or assigned
to the Beneficiary in connection with this Deed of Trust or the indebtedness
secured hereby.
<PAGE>
ARTICLE 17
EVENTS OF DEFAULT
The occurrence of any one or more of the following events shall
constitute an event of default ("EVENT OF DEFAULT") under this Deed of
Trust:
17.1 The failure of the Grantor to pay:
17.1.1 Any installment of principal and/or interest when due
under the Obligations, unless such failure is cured within ten (10) days;
17.1.2 The entire outstanding principal of the Obligations,
together with interest thereon, when due, whether at original maturity, upon
acceleration or otherwise; or
17.1.3 Any other amount payable under the Obligations, this Deed
of Trust, the Purchase Agreement, the Operating Leases or any of the other
Loan Documents to which the Grantor is a party or any supplement,
modification or extension thereof, unless such failure is cured within ten
(10) days after written notice thereof from the Beneficiary to the Grantor.
17.2 Any event of default or default by Grantor under the terms of the
Purchase Agreement, the Note or any document contemplated thereby.
17.3 Any event of default or default by Grantor under the terms of the
Operating Leases.
17.4 Any direct or indirect, voluntary or involuntary mortgage, pledge,
hypothecation, encumbrance, sale, lease, assignment or other transfer of the
Property or any portion thereof or any interest therein or any shareholder
interest in Grantor, made or suffered by the Grantor or any of its
shareholders, unless made with the prior written consent of the Beneficiary
or expressly permitted by the terms of this Deed of Trust.
17.5 The failure of the Grantor to maintain required insurance in
accordance with Article 3 of this Deed of Trust.
17.6 Any representation, warranty or statement made by the Grantor, any
of the Grantor's general partners or contained in any certificate or
statement furnished by or on behalf of any officer, director, employee,
shareholder, agent or partner of the Grantor or such partner pursuant to or
in connection herewith or therewith shall be breached or shall prove to be
untrue in any material respect on the date as of which the same was made,
which breach or untruth remains uncured for thirty (30) days after written
notice thereof from the Beneficiary to the Grantor.
17.7 There shall occur an event of default or a default which continues
beyond the
<PAGE>
applicable grace or notice period, if any, under any of the other Loan
Documents.
17.8 The Grantor shall default in the due performance or observance of
any term, covenant or agreement on the Grantor's part to be performed or
observed pursuant to any of the provisions of this Deed of Trust, the
Obligations or any of the other Loan Documents (other than those referred to
in Sections 17.1 through 17.7 hereof) and such default shall continue for a
period of thirty (30) days after written notice thereof from the Beneficiary
to the Grantor; PROVIDED, HOWEVER, that if the curing of such default cannot
be accomplished within said period of time, and if the Grantor commences to
cure such default promptly after receipt of notice thereof from the
Beneficiary, and thereafter prosecutes the curing of such default with
reasonable diligence, such period of time shall be extended to a period of
time (not to exceed an additional sixty (60) days in the aggregate)
necessary to cure such default with reasonable diligence.
17.9 The Grantor or any shareholder of the Grantor shall suspend or
discontinue its or his business, or shall make an assignment for the benefit
of creditors or a composition with creditors, shall be unable or admit in
writing its or his inability to pay its or his debts as they mature, shall
file a petition in bankruptcy, shall become insolvent (howsoever such
insolvency may be evidenced), shall be adjudicated insolvent or bankrupt,
shall petition or apply to any tribunal for the appointment of any receiver,
liquidator or trustee of or for it or him or any substantial part of its or
his property or assets, shall commence any proceedings under any bankruptcy,
reorganization, arrangement, readjustment of debt, receivership, dissolution
or liquidation law or statute of any jurisdiction, whether now or hereafter
in effect; or there shall be commenced against the Grantor or any general
partner of the Grantor any such proceeding which shall remain undismissed
for a period of sixty (60) days or more, or any order, judgment or decree
approving the petition in any such proceeding shall be entered; or the
Grantor or any general partner of the Grantor shall by any act or failure to
act indicate its or his consent to, approval of or acquiescence in, any such
proceeding or in the appointment of any receiver, liquidator or trustee of
or for it or him or any substantial part of its or his property or assets,
or shall suffer any such appointment to continue undischarged or unstayed
for a period of sixty (60) days or more; or the Grantor, any guarantor with
respect to the Grantor's obligations to the Beneficiary or any general
partner of the Grantor or such guarantor shall take any action for the
purpose of effecting any of the foregoing.
ARTICLE 18
AMENDMENTS, WAIVERS, ETC.
18.1 No change, amendment, modification, cancellation or discharge of
this Deed of Trust, or any part hereof, shall be valid unless in writing and
signed by the parties to be charged therewith or their respective successors
and assigns.
18.2 No waiver, forbearance, extension of time or other indulgence
shown by the Beneficiary to the Grantor or to any person now or hereafter
interested herein or in the
<PAGE>
Property, the Obligations or any of the other Loan Documents with respect to
any or any combination of conditions, covenants or agreements on the part of
the Grantor to be performed or observed as set forth or referred to herein
or in the Obligations or any of the other Loan Documents, shall affect the
right of the Beneficiary thereafter to require performance or observance of
the same or any other condition, covenant or agreement.
ARTICLE 19
BENEFICIARY APPOINTED ATTORNEY
The Beneficiary shall be and is hereby authorized and empowered, for
and in the name or names and on behalf of the Grantor and/or the
Beneficiary, and shall be and is hereby irrevocably made, constituted and
appointed the Grantor's true and lawful attorney in fact, coupled with an
interest and with full power of substitution, delegation and revocation, to
do the following:
19.1 In the event of foreclosure of this Deed of Trust or any transfer
of title to the Property to a third-party purchaser pursuant to the powers
hereinafter granted the Beneficiary, to collect any amounts due under any
policies of insurance insuring the Property or, at the Beneficiary's option,
to transfer the Beneficiary's right, title and interest in and to the
proceeds thereof to any purchaser of the Property without obligation to
account therefor to any person claiming title to the Property; PROVIDED,
HOWEVER, that any amounts received by the Beneficiary under said policies by
way of refunds, dividends or otherwise, as aforesaid, shall be applied to
the payment of the indebtedness secured hereby, and any surplus shall be
paid over as a surplus on foreclosure;
19.2 In the event of the sale of the Property pursuant to the power of
sale hereinafter granted, to sell, by and through the Trustee or otherwise,
subject to this Deed of Trust, all parcels which comprise the Property,
notwithstanding the fact that the proceeds of such sale may exceed the
amount then secured hereby;
19.3 To cause the assignment to the Beneficiary of any lease, license,
concession, occupancy or other tenancy agreement with respect to the
Property which has not been so assigned by the Grantor after request
therefor from the Beneficiary;
19.4 If at any time any portion of the Improvements or Personal
Property shall be unprotected, unguarded, vacant or deserted, to employ, at
the Beneficiary's option, watchmen for the Improvements and Personal
Property and to expend any monies deemed by the Beneficiary reasonably
necessary to protect the same from waste, depredation or injury; and the
amount of monies expended for such purposes, with interest from the time of
payment at the highest rate then prevailing under the terms of the
Obligations for overdue payments of principal, shall be due from and payable
by the Grantor to the Beneficiary on demand, shall be added to the
indebtedness of the Grantor to the Beneficiary and shall be secured by this
Deed of Trust;
<PAGE>
19.5 In any action or other proceeding with respect to the Property in
which the Beneficiary shall become a party or which may affect any rights of
the Beneficiary hereunder with respect to the Property or the lien of this
Deed of Trust thereon, to appear, prosecute, defend, intervene and retain
counsel in such action or proceeding and to take such other and further
action in connection therewith as the Beneficiary or the Beneficiary's
successors or assigns shall deem advisable; and the costs thereof (including
reasonable attorneys' fees and all applicable statutory costs, allowances
and disbursements), with interest from the time of payment at the highest
rate then prevailing under the Obligations for overdue payments of
principal, shall be due from and payable by the Grantor to the Beneficiary
on demand, shall be a lien on the Property, prior to any right or title to,
interest in or claim upon the Property attaching or accruing subsequent to
the lien of this Deed of Trust, shall be added to the indebtedness of the
Grantor to the Beneficiary and shall be secured by this Deed of Trust; and
19.6 Upon the occurrence of any Event of Default hereunder, to seek the
immediate appointment by any court of competent jurisdiction of a receiver
for the Property and the business of the Grantor in connection therewith and
of the rents and profits arising therefrom which receiver shall be entitled
to immediate possession of the entire Property, whether or not occupied by
the Grantor. If the Grantor is then in possession of the Property or any
portion thereof, the Grantor shall immediately, upon the appointment of such
receiver, vacate the Property or such portion thereof, as the case may be,
or pay a reasonable rental for the use thereof, during such receivership, to
be agreed upon between said receiver and the Grantor or to be fixed by the
court in which said receiver shall have been appointed; and the relationship
between said receiver and the Grantor shall be that of landlord and tenant.
19.7 Beneficiary may at any time, without giving formal notice to
the original or any successor Trustee, or to Grantor, and without regard to
the willingness or inability of any such Trustee to execute this Trust,
appoint another person or succession of persons to act as Trustee, and such
appointee in the execution of this trust shall have all the powers vested in
and obligations imposed upon the Trustee. The appointment of a successor
Trustee may be made by any officer of Beneficiary.
ARTICLE 20
BENEFICIARY'S RIGHTS UPON DEFAULT
Upon the occurrence of any Event of Default hereunder, the Beneficiary
shall have the right, forthwith, at the Beneficiary's election, by and
through the Trustee or otherwise, to exercise any and all rights and
remedies granted to the Beneficiary under this Deed of Trust, the
Obligations or any of the other Loan Documents or otherwise available to the
Beneficiary at law or in equity, all of which rights and remedies shall be
cumulative and not exclusive, and which shall include, without limitation,
the following:
20.1 The Beneficiary shall have the right forthwith, at the
Beneficiary's election, by
<PAGE>
and through the Trustee or otherwise, to declare the entire indebtedness of
the Grantor under the Obligations immediately due and payable;
20.2 The Beneficiary shall have the right, forthwith, at the
Beneficiary's election, by and through the Trustee or otherwise, and without
further notice or demand and without the commencement of any action to
foreclose this Deed of Trust, to enter immediately upon and take possession
of the Property without further consent or assignment by the Grantor, with
the right to lease the Property, or any part thereof, and to collect and
receive all of the rents, issues and profits, and all other amounts past
due, due or to become due to the Grantor by reason of the Grantor's
ownership of the Property, and to apply the same, after the payment of all
necessary charges and expenses in connection with the operation of the
Property (including any managing agent's commission, at the option of the
Beneficiary), on account of interest and principal amortization under the
Obligations, taxes, payments in lieu of taxes, water and sewer charges,
assessments and insurance premiums with respect to the Property, and any
advance made by the Beneficiary for improvements, alterations or repairs to
the Property or on account of any other indebtedness hereby secured. The
Grantor hereby irrevocably appoints the Beneficiary as the Grantor's
attorney-in-fact to institute summary proceedings against any tenant,
licensee, concessionaire or other occupant of any portion of the Property
who shall fail to comply with the provisions of any covenant, agreement or
condition applicable to the possession or occupancy of the Property by such
tenant, licensee, concessionaire or other occupant. If the Grantor or any
other person claiming by, through or under the Grantor is occupying all or
any part of the Property, it is hereby agreed that the Grantor and each such
other person shall, at the option of the Beneficiary, either immediately
surrender possession of the Property to the Beneficiary and vacate the part
of the Property so occupied or pay a reasonable rental for the use thereof,
monthly in advance, to the Beneficiary; and
20.3 The Beneficiary shall have the right forthwith, at the
Beneficiary's election, by and through the Trustee or otherwise, to sell or
offer for sale the Property in such portions, order and parcels as the
Beneficiary may determine, with or without having first taken possession of
same, at public auction for cash or cash equivalent, including, without
limitation, for certified checks, bank drafts, wire transfer funds, cashier
checks and any other method of payment which, in the sole discretion of the
Beneficiary, is "cash equivalent", to the highest and best bidder during
legal hours, at any front door of the county courthouse of the county in
which the Land is situated after having advertised and given notice of said
sale, giving the time, place and terms thereof, together with a description
of the Land according to the laws of the State of Mississippi governing
sales of land under deeds of trust in force at the time the publication of
said notice has begun. If the Land is situated in two or more counties or in
two judicial districts of the same county, then the Trustee shall have
power, in case the Trustee is directed to foreclose under this Deed of
Trust, to select in which county, or judicial district, the sale of all the
Property shall be made, and the selection shall be binding upon the Grantor
and the Beneficiary and all persons claiming through or under them, whether
by contract or by law. The Trustee shall have full power to fix the day,
time and place of sale, and may sell the Property in parcels or as a whole
as the Trustee may deem best. The Trustee shall have full
<PAGE>
power to conduct any sale through an agent appointed by the Trustee for the
purpose, but said appointment of agent need not be recorded. At any such
sale: (i) the Trustee shall not be required to have physically present, or
to have constructive possession of, the Property (the Grantor hereby
covenanting and agreeing to deliver to the Trustee any portion of the
Property not actually or constructively possessed by the Trustee immediately
upon demand by the Trustee) and the title to and right of possession of any
such Property shall pass to the purchaser thereof as completely as if the
same had been actually present and delivered to purchaser at such sale; (ii)
the Trustee may, from time to time, adjourn said sale to a later date
without readvertising, by giving notice of the time and place of such
continued sale at the time when and where the Trustee shall make such
adjournment; (iii) each and every recital contained in any instrument of
conveyance made by the Trustee shall conclusively establish the truth and
accuracy of the matters recited therein, including, without limitation,
nonpayment of the indebtedness secured by this Deed of Trust, advertisement
and conduct of such sale in the manner provided herein and otherwise by law
and by appointment of any successor Trustee hereunder; (iv) any and all
prerequisites to the validity of such sale shall be conclusively presumed to
have been performed; (v) the receipt of the Trustee or of such other party
making the sale shall be a sufficient discharge to the purchaser for its or
his purchase money and no such purchaser, or its or his assigns, successors
or personal representatives, shall thereafter be obligated to see to the
application of such purchase money or be in any way answerable for any loss,
misapplication or nonapplication thereof; (vi) the Grantor shall be
completely and irrevocably divested of all of the Grantor's right, title,
interest, claim and demand whatsoever, either at law or in equity, in and to
the property sold and such sale shall be a perpetual bar both at law and in
equity against the Grantor, and against any and all other persons claiming
or to claim the Property sold or any part thereof; (vii) the Beneficiary may
be a purchaser at any such sale; and (viii) and the Trustee, in the
Beneficiary's own name or as the attorney of the Grantor (the Trustee being
for that purpose by this Deed of Trust duly and irrevocably authorized and
appointed as the Grantor's agent and attorney in fact, coupled with an
interest and with full power of substitution, delegation and revocation) to
make, execute, acknowledge and deliver to the purchaser or purchasers
thereof a good and sufficient deed or deeds of the Property in fee simple
and to receive the proceeds of such sale or sales.
The Grantor waives the provisions of Section 89-1-55 of the Mississippi
Code of 1972, or laws amendatory thereof, if any, so far as the same
restricts the right of the Trustee to offer at sale more than one hundred
sixty (160) acres at a time, and the Trustee may offer the Land as a whole,
regardless of the manner in which the Land may be described.
Should the Property be sold in one or more parcels as permitted herein,
the right of sale arising out of any Event of Default shall not be exhausted
by any one or more such sales, but other and successive sales may be made
until all of the Property has been sold or until the indebtedness secured by
this Deed of Trust has fully satisfied.
The Grantor hereby irrevocably and unconditionally waives and releases:
(i) all benefits that might accrue to the Grantor by virtue of any present
or future law exempting the Property
<PAGE>
from attachment, levy or sale or execution or providing for any
appraisement, valuation, stay of execution, exemption from civil process,
redemption or extension of time for payment; (ii) except as otherwise
specifically required by the terms of this Deed of Trust or the other Loan
Documents, all notices of any Event of Default or of the Trustee's exercise
of any right, remedy or recourse provided for hereunder or under any of the
other Loan Documents; and (iii) any right to a marshalling of assets or a
sale in inverse order of alienation.
20.4 In case the Beneficiary or the Trustee, on behalf of the
Beneficiary, shall have proceeded to invoke any right, remedy or recourse
permitted hereunder or under any of the other Loan Documents and shall
thereafter elect to discontinue or abandon same for any reason, the
Beneficiary or the Trustee, on behalf of the Beneficiary, as applicable,
shall have the unqualified right so to do and, in such event, the Grantor,
the Beneficiary and the Trustee shall be restored to their former positions
with respect to the indebtedness secured hereby, this Deed of Trust, the
Loan Documents, the Property and otherwise, and the rights, remedies,
recourses and powers of the Beneficiary and the Trustee, on behalf of the
Beneficiary, shall continue as if same had never been invoked.
ARTICLE 21
BENEFICIARY'S RIGHTS TO RELEASE AND NEGOTIATE
21.1 Without affecting the liability of the Grantor, or any other
person (except any person expressly released in writing), for payment of the
indebtedness hereby secured or for the performance of any obligations set
forth or referred to in this Deed of Trust, the Obligations or any of the
other Loan Documents, and without affecting any lien or other security not
expressly released in writing, the Beneficiary at any time, and from time to
time, either before or after maturity of the Obligations, and without notice
or consent, may:
21.1.1 Release any person liable for payment of said
indebtedness, or for the performance of any of said obligations;
21.1.2 Make any agreement extending the time, or otherwise
altering the terms of payment of said indebtedness, or modifying or waiving
any of said obligations, or subordinating, modifying or otherwise dealing
with the lien securing payment of the Obligations;
21.1.3 Exercise or refrain from exercising or waive any right the
Beneficiary may have;
21.1.4 Accept additional security of any kind; or
21.1.5 Release or otherwise deal with any property, real or
personal, securing said indebtedness, including all or any part of the
Property.
<PAGE>
21.2 In the event that the Grantor shall, with or without the consent
of the Beneficiary, transfer or convey the Grantor's interest in the
Property, or suffer or permit any such transfer or conveyance, to a third
party or parties, whether or not in compliance with this Deed of Trust, the
Beneficiary may, without notice to the Grantor, deal with such successor or
successors in interest with reference to this Deed of Trust and the
indebtedness secured hereby, either by way of forbearance on the part of the
Beneficiary or extension of the time of payment of the indebtedness or any
sum hereby secured, without in any way modifying or affecting the transfer
or conveyance under this Deed of Trust or the original liability of the
Grantor for the indebtedness secured hereby, either in whole or in part.
Nothing in this Section, however, shall be deemed to render unnecessary the
consent of the Beneficiary to any such transfer or conveyance, as required
hereunder, and no action taken by the Beneficiary pursuant to this Section
shall be deemed to be a consent to any such transfer or conveyance.
21.3 Except as otherwise specifically provided herein, all payments on
the indebtedness hereby secured, and all proceeds from foreclosure sales,
shall be applied first to the satisfaction of all unpaid and accrued
liabilities arising from or relating to the sale, ownership or operation of
the Property, and then in the order of priority established in Section 11.3
hereof.
ARTICLE 22
REAFFIRMATION OF LOAN - PROTECTION OF SECURITY
22.1 The Grantor, within ten (10) days after request by the
Beneficiary, shall furnish to the Beneficiary a written statement, duly
acknowledged, of the amount of the unpaid balance of the Obligations, the
existence of any offsets or defenses against the Obligations and such other
information as the Beneficiary may reasonably request.
22.2 At any time and from time to time until payment of the
indebtedness secured hereby and upon request of the Beneficiary, the Grantor
will promptly execute, notarize and deliver to the Beneficiary such
additional instruments as the Beneficiary may reasonably require to evidence
further the lien of this Deed of Trust and to protect further the security
position of the Beneficiary with respect to the property subject to this
Deed of Trust, including, without limitation, additional chattel mortgages,
security agreements, financing statements, continuation statements and the
like, covering items of personal property, replacements thereof and
additions thereto.
ARTICLE 23
THE GRANTOR TO SURRENDER POSSESSION
In the event of any sale of the Property under the provisions hereof,
the Grantor shall forthwith surrender possession thereof to the purchaser.
Upon failure to do so, the Grantor shall thereupon be a tenant at sufferance
of such purchaser, and upon the Grantor's failure to surrender possession of
the Property upon demand, such purchaser, his heirs or assigns, shall
<PAGE>
be entitled to institute and maintain an appropriate action for possession
of the Property.
ARTICLE 24
IMPROVEMENTS AND PERSONAL PROPERTY SUBJECT HERETO
As between the parties hereto and all others except holders of prior
liens, it is agreed that all additions to the Improvements, including all
machinery, equipment and fixtures useful in the operation and management of
the Property regardless of the manner in which they are attached to the
Improvements, are a part of the Land (or shall become a part thereof if
hereafter placed thereon), and are, or shall be upon affixation, subject to
the lien hereof. This provision shall be cumulative and not exclusive. This
provision shall not apply to items installed by a tenant which remain the
property of the tenant pursuant to the terms of such tenant's lease.
ARTICLE 25
PRESERVATION OF EASEMENTS AND LICENSES
The Grantor shall maintain, preserve and renew all rights of way,
easements, grants, privileges, licenses and franchises necessary for the use
of the Property from time to time and will not, without the prior consent of
the Beneficiary, initiate, join in or consent to any private restrictive
covenant or other public or private restriction as to the use of the
Property. The Grantor shall, however, comply with all restrictive covenants
which may at any time affect the Property, and all zoning ordinances and
other public or private restrictions as to the use of the Property, except
where the failure to comply does not and could not have a material adverse
effect.
ARTICLE 26
SECURITY AGREEMENT
26.1 It is the intent of the Grantor, the Trustee and the Beneficiary
that, in addition to being a deed of trust of real property, this instrument
shall constitute a security agreement within the meaning of the Uniform
Commercial Code (as from time to time in effect in the State of Mississippi,
the "Code") with respect to all fixtures, chattels and personal property,
and all replacements thereof, substitutions therefor, additions thereto and
proceeds thereof (said property being sometimes hereinafter referred to as
the "COLLATERAL"), and a security interest is hereby granted by the Grantor,
as debtor, to the Beneficiary, as secured party, encumbering all of the
Collateral as security for the indebtedness evidenced by the Obligations and
all other obligations secured by this Deed of Trust, and all other sums and
charges which may become due hereunder or thereunder.
26.2 The Grantor warrants and covenants as follows:
26.2.1 No financing statement covering any of the Collateral or
any proceeds
<PAGE>
thereof is on file in any public office, other than financing statements
with respect to the security interest granted hereby; and except for the
security interest granted hereby, the Grantor is, or upon acquiring rights
in any of the Collateral will be, the owner of the Collateral free from any
other lien, security interest or encumbrance; and the Grantor shall defend
the security interest of the Beneficiary in the Collateral against claims
and demands of all persons at any time claiming the same or any interest
therein; and
26.2.2 At the request of the Beneficiary from time to time, the
Grantor shall join with the Beneficiary in executing one or more financing
and/or continuation statements pursuant to the Code in form satisfactory to
the Beneficiary and shall pay the costs of filing or recording the same in
all public offices wherever filing or recording is deemed by the Beneficiary
to be reasonably necessary or desirable, and to the extent permitted by law,
the Grantor hereby further authorizes the Beneficiary to file such financing
and continuation statements and amendments thereto without the signature of
the Grantor or to sign such financing and continuation statements and
amendments on behalf of the Grantor (the Beneficiary being for such purposes
by this instrument duly and irrevocably appointed as the Grantor's agent and
attorney-in-fact, coupled with an interest and with full power of
substitution, delegation and revocation).
26.3 Upon the occurrence of an Event of Default under this Deed of
Trust, the Beneficiary, pursuant to the Code, shall have the right, at the
Beneficiary's option, by and through the Trustee or otherwise:
26.3.1 To proceed as to both the real and personal property
covered by this Deed of Trust in accordance with the Beneficiary's rights
and remedies in respect of said real property, in which event (i) the
provisions of the Code otherwise applicable to sale of the Collateral shall
not apply, and (ii) the sale of the Collateral in conjunction with and as
one parcel with said real estate (or any portion thereof) shall be deemed to
be a commercially reasonable manner of sale: or
26.3.2 To proceed as to the Collateral separately from the Land
and Improvements, in which event the requirement of reasonable notice shall
be met by mailing notice of the sale, postage prepaid, to the Grantor or any
other person entitled thereto at least ten (10) days before the time of the
sale or other disposition of any of the Collateral.
26.4 The tangible Collateral shall be kept at the Land, and until
installed will be suitably and safely stored thereon.
26.5 The Grantor shall not remove or permit to be removed from the Land
any of the tangible Collateral without the prior written consent of the
Beneficiary.
26.6 The foregoing shall not prohibit the Grantor from (a) making
replacements of fixtures and equipment from time to time in the usual course
of business or (b) leasing or
<PAGE>
purchasing fixtures and equipment on conditional bill of sale, security
agreement or other title retention agreement, and the lien of the
Beneficiary thereon shall be subject and subordinate to the rights or lien
of the lessor, conditional vendor or other lienor thereof; PROVIDED,
HOWEVER, that the Grantor shall duly and punctually pay, perform, observe
and comply with each and every obligation of the Grantor under any such
lease, conditional bill of sale, security agreement or other title retention
agreement to the end that no default shall occur thereunder which would
allow any lessor, conditional vendor or other lienor to reclaim possession
of the property in question.
26.7 The Grantor shall, from time to time, on request of the
Beneficiary, deliver to the Beneficiary an inventory of the Collateral in
reasonable detail, including an itemization of all items leased to the
Grantor or subject to conditional bill of sale, security agreement or other
title retention agreement.
26.8 To the extent permitted by law, a carbon, photographic or other
reproduction of this Deed of Trust or a financing statement shall be
sufficient as a financing statement.
ARTICLE 27
CERTAIN ENVIRONMENTAL MATTERS
27.1 The Grantor covenants and agrees that the Grantor (i) has not
stored, used, handled or generated and shall not store, use, handle or
generate (except in strict compliance with all statutes, laws, ordinances,
rules and regulations) and has not disposed and shall not dispose of any
hazardous wastes, contaminants, oils, petroleum products, asbestos,
radioactive or other materials the removal of which is required or the
maintenance of which is prohibited or regulated by any applicable federal,
state or local statutes, laws, ordinances, rules or regulations relating in
any manner to the environment or the health and safety of others
(collectively, "HAZARDOUS SUBSTANCES") on the Property, (ii) has not
transported or arranged for the transportation of and shall not transport or
dispose of or arrange for the transportation or disposal of any Hazardous
Substances, except in compliance with all statutes, laws, ordinances, rules
and regulations and where no Material Adverse Effect could result therefrom,
and (iii) has not suffered or permitted, and shall use reasonable efforts
not to permit or suffer, any owner, lessee, occupant or operator of the
Property to do any of the foregoing.
27.2 The Grantor covenants and agrees to maintain the Property at all
times free of any Hazardous Substance (except in strict compliance with all
statutes, laws, ordinances, rules and regulations).
27.3 The Grantor agrees promptly: (i) to notify the Beneficiary in
writing of any change in the nature or extent of Hazardous Substances
maintained on or with respect to the Property, (ii) to transmit to the
Beneficiary copies of any citations, orders, notices or other material
governmental communications received with respect thereto, (iii) to observe
and comply with any and all statutes, laws, ordinances, rules and
regulations, licensing
<PAGE>
requirements or conditions relating to the use, storage, maintenance and
disposal of Hazardous Substances and all orders or directives from any
official, court or agency of competent jurisdiction relating to the use or
maintenance or requiring the removal, treatment, containment or other
disposition thereof, (iv) to pay or otherwise dispose of any fine, charge or
imposition related thereto which, if unpaid, would constitute a lien on the
Property, unless (a) the validity thereof shall be contested diligently and
in good faith by appropriate proceedings and with counsel reasonably
satisfactory to the Beneficiary and (b) so long as the Grantor shall at all
times have deposited with the Beneficiary, or posted a bond satisfactory to
the Beneficiary in, a sum equal to the amount necessary (in the reasonable
discretion of the Beneficiary) to comply with such order or directive
(including the amount of any fine, penalty, further interest or cost that
may become due thereon by reason of or during such contest): PROVIDED,
HOWEVER, that payment in full with respect to such fine, charge or
imposition shall be made not less than twenty (20) days before the first
date upon which the Property, or any portion thereof, shall be seized and
sold in satisfaction thereof, and (v) upon the request of the Beneficiary,
and at the Grantor's expense, to cause to be prepared for the Property such
site assessment report(s), including, without limitation, engineering
studies, historical review and testing, as may be reasonably requested by
the Beneficiary.
27.4 The Grantor agrees to indemnify, defend and reimburse and does
hereby hold harmless the Beneficiary, and its officers, directors, agents,
shareholders, employees, contractors, representatives, successors and
assigns, from and against any and all claims, judgments, damages, losses,
penalties, fines, liabilities, encumbrances, liens, costs and expenses of
investigation and defense of any claim, of whatever kind or nature,
including, without limitation, reasonable attorneys' fees and consultants'
fees, arising from the presence of Hazardous Substances upon, about or
beneath the Property or migrating to and from the Property or arising in any
manner whatsoever out of the violation of any Federal, state or local
statutes, laws, ordinances, rules, regulations and common law, now or
hereafter in effect, and all amendments thereto, relating to the protection
of human health or the environment and pertaining to the Property and the
activities thereon, or arising from the breach of any covenant or
representation of the Grantor contained in this Deed of Trust. The Grantor's
obligations under this Section shall survive any foreclosure on the Property
or repayment or extinguishment of the Grantor's indebtedness to the
Beneficiary; PROVIDED, HOWEVER, that notwithstanding anything to the
contrary contained in this Section, the Grantor's obligations under this
Section shall not apply with respect to any Hazardous Substances placed,
stored, released or migrating to or from the Property at any time after any
sale or transfer (whether voluntary or involuntary, by foreclosure, deed in
lieu of foreclosure or otherwise) of the Property to a Person who is not an
Affiliate of Beneficiary, the Grantor or any of their Subsidiaries (as such
terms are defined in the Loan Agreement).
<PAGE>
ARTICLE 28
INVALIDITY OF PROVISIONS
28.1 All agreements between the Grantor and the Beneficiary contained
herein are hereby expressly limited so that in no contingency or event
whatsoever, whether by reason of acceleration of maturity of the
Obligations, or otherwise, shall the amount paid or agreed to be paid to the
Beneficiary for the use, forbearance or detention of the principal amount
evidenced by the Obligations and secured by this Deed of Trust exceed the
maximum permissible under applicable law the benefit of which may be
asserted by the Grantor as a defense, and if, from any circumstances
whatsoever, fulfillment of any provision of the Obligations and this Deed of
Trust, at the time performance of such provision shall be due, shall involve
transcending the limit of validity prescribed by law, or if from any
circumstances the Beneficiary should ever receive as interest under the
Obligations, this Deed of Trust or any of the other Loan Documents such an
excessive amount, then, ipso facto, the amount which would be excessive
interest shall automatically be applied to the reduction of the principal
balance as evidenced by the Obligations and secured by this Deed of Trust
and not to the payment of interest. This provision shall control every other
provision of all agreements between the Grantor and the Beneficiary.
28.2 In case any one or more of the provisions contained in the
Obligations or in this Deed of Trust shall for any reason be held to be
invalid, illegal or unenforceable in any respect, such invalidity,
illegality or unenforceability shall not affect any other provision hereof
or thereof, but each shall be construed as if such invalid, illegal or
unenforceable provision had never been included.
ARTICLE 29
ASSIGNMENT
The Beneficiary may assign all or any portion of the Beneficiary's
rights under this Deed of Trust, and in the event of such assignment the
Grantor shall accord full recognition thereto.
ARTICLE 30
NOTICES
Any notice, demand or communication required or permitted to be given by any
provision of the Loan Documents will be in writing and will be deemed to
have been given when delivered personally or by telefacsimile, receipt
confirmed (with a hard copy sent within one (1) business day by any other
means described in this paragraph), to the party designated to receive such
notice or on the next business day following the day sent by a nationally
recognized overnight courier or on the third (3rd) business day after the
same is sent by United States certified mail, postage and charges prepaid,
directed to the following addresses or to such other or additional addresses
as any party might designate by written notice to the other party:
<PAGE>
If to the Grantor, to:
H & S Fish Farms, Inc.
Attention:______________
______________________
______________________
If to the Beneficiary, to:
Farm Fish, Inc.
Attention:______________
100 West Woodrow Wilson Blvd.
Jackson, Mississippi 39213
If to the Trustee, to:
Forman, Perry, Watkins, Krutz & Tardy, PLLC
Attn: ___________________
P.O. Box 22608
Jackson, MS 39225-2608
With a copy to:
Forman, Perry, Watkins, Krutz & Tardy, PLLC
Attn: Steven M. Hendrix
Post Office Box 22608
Jackson, MS 39225-2608
Telephone: (601) 960-8603
Facsimile: (601) 960-8609
and to:
Frascogna & Courtney
Attn: Mike Frascona
6360 I-55 North, Suite 150
Jackson, MS 39211
Telephone: (601) 987-3000
Facsimile: (601) 987-3001
Any party may, by notice given as aforesaid, change such party's address for
all subsequent notices. Each notice by or on behalf of the Beneficiary
herein named shall be deemed sufficient
<PAGE>
if signed by any one of the Beneficiary's officers or by the Beneficiary's
counsel and if otherwise given or made in compliance with this Section.
ARTICLE 31
STATUS OF THE GRANTOR, ETC.
The Grantor hereby represents and warrants the following (and the
Grantor covenants and agrees that such representations and warranties shall
remain true and correct throughout the term of this Deed of Trust):
The Property and the use and operation thereof are in material
compliance with all applicable Federal, state, municipal and other
governmental statutes, laws, ordinances, by-laws, rules, regulations and
other legal requirements, including, without limitation, those relating to
construction, occupancy, zoning, subdivision, land use, adequacy of parking,
conservation, wetlands protection, environmental protection, occupational
health and safety and fire safety, and with all restrictions and easements
of any kind affecting the Property, and there are presently in effect all
licenses, permits and other authorizations necessary for the current use,
occupancy and operation of the Property, except to the extent that non-
compliance does not and could not have a Material Adverse Effect. No
building or other improvement not included in any part of the Property
relies on any part of the Property to fulfill any zoning, building code or
other governmental or municipal requirement.
ARTICLE 32
GENERAL PROVISIONS
32.1 The Grantor hereby waives and renounces all homestead exemption
rights provided for by the Constitution and laws of the United States or the
State of Mississippi, in and to the Property as against the collection of
the indebtedness secured herein, or any part thereof; and the Grantor agrees
that where, by the terms of this Deed of Trust or the Obligations, a day is
named or a time fixed for the payment of any sum of money or the performance
of any agreement, the time stated enters into the consideration and is of
the essence of the whole contract.
32.2 The captions in this Deed of Trust are for convenience and
reference only and do not define, limit or describe the scope of the
provisions hereof.
32.3 This Deed of Trust shall inure to the benefit of and bind (i) the
successors and assigns of the Beneficiary and (ii) the heirs,
administrators, executors, successors and assigns of the Grantor, as if all
the aforesaid were herein mentioned whenever the parties hereto are referred
to. This instrument shall be so construed that, whenever applicable with
reference to any of the parties hereto, the use of the singular number shall
include the plural number, the use of the neuter gender with respect to the
Grantor shall include the masculine and feminine gender, and shall likewise
be so construed as applicable to and including a corporation or
<PAGE>
corporations or any other entity that may be a party or parties hereto.
32.4 This Deed of Trust shall be interpreted, construed, applied and
enforced in accordance with the laws of the State of Mississippi, regardless
of (i) where this Deed of Trust is executed or delivered, (ii) where any
payment or other performance required by this Deed of Trust is made or
required to be made, (iii) where any breach of any provision of this Deed of
Trust occurs or any cause of action otherwise accrues, (iv) where any action
or other proceeding is instituted or pending, (v) the nationality,
citizenship, domicile, principal place of business, jurisdiction of
organization or domestication of any party, (vi) whether the laws of the
forum jurisdiction otherwise would apply the laws of a jurisdiction other
than the State of Mississippi, or (vii) any combination of the foregoing.
Notwithstanding the foregoing, the laws of the jurisdiction where any of the
Property or any of the Collateral is situated or otherwise has a situs will
apply to the perfection, disposition and realization upon the Property and
the Collateral, as applicable.
32.5 The Grantor, the Beneficiary and the Trustee hereby irrevocably
consent (i) to the jurisdiction of the Courts of the First Judicial District
of Hinds County, Mississippi, and of any Federal Court located in the
Southern District of Mississippi, Jackson Division, and agree that venue in
each of such Court is proper in connection with any action or proceeding
arising out of or relating to this Deed of Trust, the Obligations, the other
Loan Documents or any document or instrument delivered pursuant to this Deed
of Trust, the Obligations or the other Loan Documents, and (ii) to the
service of process by certified mail, return receipt requested. Nothing
herein shall affect the right of the Grantor, the Beneficiary or the Trustee
to serve process in any other manner permitted by law or to commence legal
proceedings or otherwise proceed against any party in any other
jurisdiction, with a copy to Beneficiary's and Grantor's counsels of record.
32.6 This Deed of Trust shall continue to be effective or be
reinstated, as the case may be, if at any time any payment of any of the
indebtedness secured hereby is rescinded or otherwise must be returned by
the Trustee or the Beneficiary upon the insolvency, bankruptcy or
reorganization of the Grantor, any guarantor or otherwise, all as though
such payment had not been made.
32.7 Time is of the essence of this Deed of Trust.
32.8 In case of any conflict between the terms of this Deed of Trust
and the terms of the Loan Agreement, the terms of the Loan Agreement shall
prevail, but whenever possible, the provisions hereof shall be deemed
supplemental to and not is derogation of the provisions of the Loan
Agreement. Any default under this Deed of Trust shall constitute a default
under the Loan Agreement and any default under the Loan Agreement shall
constitute a default hereunder.
<PAGE>
ARTICLE 33
THE TRUSTEE
The following provisions shall govern with respect to the Trustee:
33.1 The Trustee shall not be liable for any error of judgment or act
done by the Trustee in good faith, or be otherwise responsible or
accountable to the Grantor under any circumstances whatsoever, nor shall the
Trustee be personally liable in case of entry by the Trustee, or anyone
entering by virtue of the powers herein granted, upon the Property for debts
contracted or liability or damages incurred in the management or operation
of the Property. The Trustee shall have the right to rely on any instrument,
document or signature authorizing or supporting any action taken or proposed
to be taken by the Trustee hereunder, believed by the Trustee in good faith
to be genuine. The Trustee shall be entitled to reimbursement for expenses
incurred by the Trustee in the performance of the Trustee's duties
hereunder. The Grantor will, from time to time, reimburse the Trustee for,
and save the Trustee harmless against, any and all liability and expenses
which may be incurred by the Trustee pursuant to the terms hereof in the
performance of the Trustee's duties hereunder.
33.2 All moneys received by the Trustee shall, until used or applied as
herein provided, be held in trust for the purposes for which they were
received, but need not be segregated in any manner from any other moneys
(except to the extent required by law), and the Trustee shall be under no
liability for interest on any money received by the Trustee hereunder.
33.3 The Trustee may resign at any time with or without notice. If the
Trustee shall die, resign or become disqualified from acting in the
execution of this trust or shall fail or refuse to execute the same when
requested by the Beneficiary so to do, or if, for any reason, the
Beneficiary shall prefer to appoint a substitute trustee to act instead of
the aforenamed Trustee, the Beneficiary shall have full power to appoint a
substitute trustee and, if preferred, several substitute trustees in
succession who shall succeed to all the estates, rights, powers and duties
of the aforenamed Trustee. If the Beneficiary is a corporation, such
appointment may be made by any one of the Beneficiary's officers or agents.
33.4 Any new Trustee appointed pursuant to any of the provisions hereof
shall, without any further act, deed or conveyance, become vested with all
the estates, properties, rights, powers and trusts of its or his predecessor
in the rights hereunder with like effect as if originally named as Trustee
herein, but nevertheless, upon the written request of the Beneficiary or of
the successor Trustee, the Trustee ceasing to act shall execute and deliver
an instrument transferring to such successor Trustee, upon the trusts herein
expressed, all the estates, properties, rights, powers and trusts of the
Trustee so ceasing to act, and shall duly assign, transfer and deliver any
of the property and money held by such Trustee to the successor Trustee so
appointed in its or his place.
<PAGE>
IN WITNESS WHEREOF, the Grantor has caused this Deed of Trust to be
duly executed on the _____ day of _________, 2000, effective as of
_________, 200__.
Grantor:
H & S Fish Farms, Inc.
By:________________________________
Name:___________________________
Title:____________________________
Beneficiary:
Farm Fish, Inc.
By:____________________________________
Name:______________________________
Title________________________________
<PAGE>
EXHIBIT A
LEGAL DESCRIPTION
See attached copy.
<PAGE>
EXHIBIT B
PERMITTED EXCEPTIONS
See attached copy.
<PAGE>
STATE OF MISSISSIPPI
COUNTY OF ____________
Personally appeared before me, the undersigned authority in and for
the said county and state, on this ____ day of _____, 200___, within my
jurisdiction, the within named ______________, who acknowledged that he
is _________ of H & S Fish Farms, Inc., a Mississippi corporation, and
that for and on behalf of the said company, and as its act and deed he
executed the above and foregoing instrument, after first having been
duly authorized by said company so to do.
____________________________________
NOTARY PUBLIC
MY COMMISSION EXPIRES:
_________________________
[AFFIX NOTARIAL SEAL]
STATE OF MISSISSIPPI
COUNTY OF HINDS
Personally appeared before me, the undersigned authority in and for
the said county and state, on this ____ day of _______, 200__, within my
jurisdiction, the within named _______________, who acknowledged that he
is _____________, of Farm Fish, Inc., a Mississippi corporation and that
for and on behalf of the said corporation, and as its act and deed, he
executed the above and foregoing instrument, after having been duly
authorized by said corporation so to do.
____________________________________
NOTARY PUBLIC
MY COMMISSION EXPIRES:
_________________________
[AFFIX NOTARIAL SEAL]
<PAGE>
PROMISSORY NOTE
_______, 2000
$1,500,000.00 Jackson, Mississippi
FOR VALUE RECEIVED, the undersigned, H & S Fish Farms, Inc., a
Mississippi corporation ("Maker"), hereby promises to pay to the order
of Farm Fish, Inc., a Mississippi corporation, Jackson, Mississippi
("Payee") payable at Payee's office at 100 West Woodrow Wilson Blvd.,
Jackson, Mississippi 39213, in immediately available funds and in lawful
coin or currency of the United States of America which shall be legal
tender for payment of all debts and dues, public and private, the
principal sum of ONE MILLION FIVE HUNDRED THOUSAND AND NO/100 DOLLARS
($1,500,000.00), together with interest from and after the date hereof
on the unpaid outstanding principal balance until paid in full at the
rate of interest per annum set forth below.
The following terms apply to this Note:
1. TERM. The term of this Note shall be ten (10) years from the
date hereof. Final maturity of all interest and principal shall be
________, 2010.
2. INTEREST.
2.1 RATE. The principal balance under this Note, together
with any interest due but unpaid, shall bear interest at an annualized
rate equal to six (6 %) per annum; PROVIDED, HOWEVER, in no event shall
the interest rate at any time exceed the maximum rate of interest
allowable by law.
2.2 INITIAL ACCRUAL DATE. Interest shall begin to accrue on
the day and year first hereinabove written and shall accrue on the full
amount of the unpaid principal balance hereunder.
2.3 CALCULATION OF INTEREST. Interest shall be calculated on
the basis of a 365 days per year factor applied to the actual days on
which there exist an unpaid principal balance with accrued interest.
2.4 DEFAULT RATE. From and after the occurrence of a default
hereunder or an Event of Default under the Security Agreement, overdue
payments of principal and (to the extent permitted by law) interest
shall bear interest, from and after the date the same become due and
payable, at an annual rate of four (4) percentage points above the prime
rate of interest as announced from time to time by Trustmark National
Bank or any successor thereof. Such interest shall continue to accrue
until the obligations of Maker with respect to the default or Event of
Default have been cured in full. Each change in the prime rate shall
simultaneously change the default rate hereunder.
3. MANDATORY PAYMENTS OF PRINCIPAL AND INTEREST. Unless
accelerated pursuant to the terms hereof, the principal of this Note
together with accrued and unpaid interest on the principal balance
<PAGE>
of this Note shall be due and payable in quarterly installments of
$50,140.77 on the first day of January, April, July, and October during
the term of this Note with the first payment being due _________, 2000.
Any and all unpaid accrued interest and any outstanding principal
balance shall be due and payable in full on ___________, 2010.
5. LATE PAYMENT CHARGES. In the event that Maker is more than
fifteen (15) days late in the payment of any portion of principal and
interest hereunder as and when the same is or becomes due, Maker shall
pay a late payment charge in the amount of four percent (4%) of the
amount of any delinquency if such delinquency is not paid in full as and
when each payment of principal and interest is due hereunder. Only one
late payment charge may be charged with respect to any specific
installment and no such late payment charge may be collected on a
partial payment resulting solely from the deduction of a late payment
charge from a regularly scheduled payment. In no event shall the late
payment charge exceed the maximum rate allowable by law.
6. COLLECTION FEES. In the event a default occurs in the timely
payment of any portion of principal and interest hereon as and when the
same is or becomes due and such payment is not made by Maker within
twenty (20) days after written demand is given to Maker, and thereafter
the same is placed in the hands of an attorney or agent for collection,
or suit is brought on the same, or proceedings are had in bankruptcy,
receivership, reorganization or other judicial proceedings for
establishment or collection of any amount called for hereunder, or any
amount payable or to be payable is collected through any such
proceedings, Maker hereby agrees and promises to pay to Payee a
reasonable amount for attorneys' or collection fees.
7. SECURITY. Payee shall have a first position security interest
in all of Maker's real property and equipment, as evidenced by that
certain Deed of Trust and Security Agreement executed by Maker for the
benefit of Payee of even date herewith ("Security Agreement"). Maker
hereby covenant, promises, and agrees to execute any other documents to
memorialize and protect Payee's security interest hereunder.
8. PREPAYMENT. Maker shall have the privilege of prepaying the
whole amount due hereunder or any portion thereof at any time before
maturity without premium or penalty. All payments of principal and
interest hereunder shall be first applied to accrued interest, if any,
and then to principal.
9. DEFAULT. The occurrence of any one or more of the following
events shall constitute a default under this Note, whereupon Payee or
any holder hereof may, at its, his or her option, exercise any or all
rights, powers and remedies afforded under any loan, credit or security
agreement with Payee, all other instruments evidencing, securing or
guaranteeing this Note and by law, including the right to declare the
unpaid balance of principal and accrued interest on this Note at once
mature, due and payable in full and to offset against the amounts then
owing under this Note or any and all monies, securities, notes and other
properties of the Maker in the
<PAGE>
possession, custody or control of, or on deposit with, or otherwise
pledged or owed to Payee or any other holder hereof, including, without
limitation, all such monies, securities, notes and other properties held
in general or special accounts or for safekeeping or as collateral or
otherwise by Payee:
(a) Maker shall fail to pay the principal and interest due
under this Note as and when the same becomes due and payable and/or
performable after giving effect to the thirty (30) day grace period
for the payment of principal and interest hereunder, whether by
acceleration or otherwise; or
(b) any "Event of Default" under or pursuant to the Security
Agreement or any other documents or agreements executed in
connection with any outstanding monetary obligations or other
material non-monetary obligations of Maker to Payee and any or all
extensions or modifications of all such documents or agreements.
10. NO WAIVER BY PAYEE. No delay or omission on the part of
Payee, or any other holder, in exercising any right hereunder or related
to the obligations evidenced hereby shall operate as a waiver of such
right or of any other right. A waiver on any one occasion shall not be
construed as a bar to or waiver of any such right and/or remedy on any
future occasion.
11. NO RIGHT OF SETOFF. Maker and all co-makers, sureties,
endorsers, guarantors, or other parties, whether primarily or
secondarily liable on this Note or the indebtedness evidenced hereby,
covenant, promise and agree that none of them shall have any right to
setoff any amounts due hereunder to Payee or any other holder of this
Note for any alleged breach of any of Payee's representations or
warranties or other obligations under that certain Asset Purchase
Agreement by and between Payee and Maker dated July ___, 2000. Maker
covenants and agrees that it shall unconditionally tender payment of all
amounts due hereunder when such amounts are due without regard to any
claimed right to setoff against Payee.
12. WAIVER. Maker and all co-makers, sureties, endorsers,
guarantors, or other parties of this Note hereby waive presentment,
demand, notice, protest and all other demands and notices in connection
with the delivery, acceptance, performance, default or endorsement of
this Note or their respective obligations hereon; consents to any
extensions or postponements of the due date or time of payment hereof,
or of any other indebtedness, with or without concurrence of the Maker,
in whole or in part, without notice to the Maker, co-maker, surety,
endorser, guarantor or other parties of this Note and without limitation
as to the number of such extensions or the period or periods thereof;
and consents to any substitution, exchange or release of collateral
and/or to the addition or release of any other party or person whether
primarily or secondarily liable. Each extension granted shall be noted
by Payee or any holder referenced on the reverse side of this instrument
with a new date or maturity clearly indicated.
<PAGE>
13. PARAGRAPH HEADINGS. Paragraph headings appearing in this Note
are for convenience of reference only and shall not be used to
interpret, expand or limit the meaning of any provision of this Note.
14. GOVERNING LAW. This Note shall be governed by and construed
in accordance with the laws of the State of Mississippi and the United
States of America as from time to time in effect. Mississippi shall be
proper place of venue for suit hereon. The Maker and any and all
co-makers, sureties, endorsers, guarantors and other parties under this
Note irrevocably agree that any legal proceeding in respect of this Note
shall be brought in the appropriate courts of Mississippi or the United
States District Court for that district.
15. SUCCESSORS AND ASSIGNS. This Note and all the covenants and
agreements contained herein shall be binding upon, and shall inure to
the benefit of, the respective legal representatives, heirs, successors
and assigns of Maker and Payee.
16. SEVERABILITY. If any provision of this Note or the
application thereof to any person or circumstance shall be invalid or
unenforceable to any extent, the remainder of this Note and the
application of such provisions to other persons or circumstances shall
not be affected thereby and shall be enforced to the greatest extent
permitted by law.
17. WAIVER OF JURY TRIAL. MAKER AND ALL CO-MAKERS, SURETIES,
ENDORSERS, GUARANTORS AND ALL OTHER PARTIES UNDER THIS NOTE HEREBY
EXPRESSLY WAIVE THE RIGHT TO TRIAL BY JURY.
18. NOTICES TO MAKER. Any notice required by the terms of this
Note to be given to the Maker shall be deemed given on the day actually
delivered to the Maker or, if mailed, when deposited in the United
States mail, postage prepaid, certified or registered mail, addressed to
the Maker at _________________, _________, Mississippi _________ or at
such address as the Maker may, from time to time, specify in writing
delivered to the Payee. Any such address change shall be effective ten
(10) days after actual receipt of such written notice by Payee.
19. FEES. Upon demand, Maker agrees to pay all expenses directly
relating to this Note or to be incurred in its servicing, including, but
not limited to, reasonable attorneys' fees, filing and recording fees
and insurance premiums.
IN WITNESS WHEREOF, this Promissory Note has been executed by the
undersigned as of the day and year first hereinabove written.
MAKER:
H & S Fish Farms, Inc.
By:________________________________
<PAGE>
Name:___________________________
Title:____________________________
WITNESSED BY:
______________________________
STATE OF MISSISSIPPI
COUNTY OF HINDS
Personally appeared before me, the undersigned authority in and for
the said county and state, on this ___ day of ________, 20__, within my
jurisdiction, the within named ______________, who acknowledged that he
is ____________ of H & S Fish Farms, Inc., a Mississippi corporation,
and that for and on behalf of the said company, and as its act and deed
he executed the above and foregoing instrument, after first having been
duly authorized by said company so to do.
________________________________
NOTARY PUBLIC
My commission expires:
____________________
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 1
As of _______, 2000
Farm Fish, Inc.
100 West Woodrow Wilson Blvd.
Jackson, Mississippi 39213
Re: Acquisition of certain property located in Humphreys County,
Mississippi commonly known as the ___________________
(collectively, the "Property")
Ladies and Gentlemen:
We have acted as counsel for H & S Fish Farms, Inc., a Mississippi
corporation ("Buyer"), in connection the sale of the Property (the
"Transaction") by Farm Fish, Inc., a Mississippi corporation ("Seller")
to Buyer. The Transaction has been executed effective as of the date
hereof (the "Effective Date").
For purposes of this opinion letter, we have relied without
independent investigation upon factual, and not legal, representations
made by Buyer in the Transaction Documents and in the certificates of
officers of Buyer as well as a review of the following instruments and
documents:
1. Asset Purchase Agreement between Seller and Buyer, dated
as of the Effective Date ("Purchase Agreement").
2. Lease Agreement, in the form attached to the Purchase
Agreement to be executed by Buyer as tenant and Seller as landlord prior
to the closing date of the Transaction ("Lease Agreement").
3. Certificate of Buyer, dated as of the Effective Date,
together with exhibits attached thereto.
Exhibit A Certificate of Existence/Authority of Buyer, certified by
the Secretary of State of Mississippi.
Exhibit B Certificate of Incorporation of Buyer, as amended and
certified by the Secretary of State of Mississippi.
Exhibit C Bylaws of Buyer certified on behalf of Buyer as of the
Effective Date.
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 2
Exhibit D Resolutions of Buyer and its shareholders certified on
behalf of Buyer as of the Effective Date.
The instruments referred to in items 1 through 2 above are herein
called the "Transaction Documents". The "Buyer Constituent Documents"
(Item 3) are collectively referred to herein as "Constituent Documents".
This Opinion Letter is governed by, and shall be interpreted in
accordance with, the Legal Opinion Accord (the "Accord") of the American
Bar Association Section of Business Law (1991). As a consequence, it is
subject to a number of qualifications, exceptions, definitions,
limitations on coverage and other limitations, all as more particularly
described in the Accord, and this Opinion Letter should be read in
conjunction therewith. The General Qualifications and Specific Legal
Exclusions of the Accord apply to all the Opinions expressed herein.
Except as otherwise indicated herein, capitalized terms used in this
Opinion Letter are defined as set forth in the Accord or, if not defined
in the Accord, the Transaction Documents.
Based upon our examination of the foregoing and other matters of
law or fact deemed appropriate to give the opinions contained herein and
subject to the limitations and qualifications herein set forth, we are
of the opinion that:
a. Buyer is a corporation incorporated, legally existing and
in good standing under the laws of the State of Mississippi and is
qualified to transact business in the States of Mississippi. Buyer has
the corporate power and authority to own its properties and to carry on
its business as now being conducted. Buyer has all requisite corporate
authority to execute and perform its obligations under the Transaction
Documents to which it is a party. The individuals executing the
Transaction Documents on behalf of Buyer have been duly authorized and
empowered to do so.
b. All necessary company or corporate action has been taken
to authorize the execution, delivery and performance of the Transaction
Documents by Buyer. All of the Transaction Documents have been duly
executed and delivered to Buyer by Buyer, and no consents, permissions
or authorizations are required from any other parties in connection with
the execution and delivery of the Transaction Documents.
c. No authorization, consent, approval or other action by,
or filing with, any court or governmental authority of the State of
Mississippi or the United States of America is required in connection
with the execution and delivery by Buyer of the Transaction Documents.
To the extent that the foregoing relates to any foreign jurisdiction
(other than federal law and Mississippi law), we have not undertaken any
investigation or review of the laws (statutory or otherwise) of any
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 3
non-Mississippi (other than federal) jurisdiction, and that Buyer is
relying on other counsel with respect to such matters.
d. The execution and delivery of the Transaction Documents
by Buyer do not violate, conflict with, breach, or constitute (with due
notice or lapse of time, or both) a default under any of the Constituent
Documents.
e. We have no Actual Knowledge of any actions, suits or
proceedings (including, but not limited to, any bankruptcy proceeding)
pending or threatened against Buyer which, if adversely determined,
would result in any material adverse changes in the condition, financial
or otherwise, of Buyer.
The opinions expressed herein are qualified in the following areas:
a. This opinion is limited in all respects to Federal laws and
the laws of the State of Mississippi. We do not opine as to the laws of
any other state. To the extent required by the opinions set forth
herein, we have assumed that the courts will apply the laws of the State
of Mississippi to the interpretation, construction and enforcement of
the Transaction Documents.
b. References herein to our Actual Knowledge and similar
references shall mean the actual knowledge of (i) our attorneys
substantially participating in the work of this firm with respect to the
transactions evidenced or contemplated by the Transaction Documents,
based solely upon our participation as counsel to Buyer, and (ii) our
attorneys, if any, working on any litigation relating to Buyer and with
respect to such groups referred to in (i) and (ii) without in any manner
having conducted any independent investigations in respect of factual
matters; however, we have no reason to believe that any of the factual
matters are untrue.
c. No opinion is expressed herein as to, and we have assumed for
purposes of our opinions the due, valid and proper (i) formation of
Seller, (ii) execution of the Transaction Documents by Seller were
appropriate and fully authorized,(iii) performance of the obligations of
Seller thereunder, and (iv) performance of all legal obligations of
Seller. We also express no opinion, and have assumed for purposes of
our opinion, that Seller has the authority to do business in the State
of Mississippi and Seller has complied with all Legal Requirements
applicable to Seller or any contract to which Seller is a party,
including the Transaction Documents and payment of all applicable taxes
by Seller.
d. The opinions expressed herein are limited to matters of law
and do not constitute any opinions as to, or representations regarding,
matters of fact.
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 4
e. We have not conducted any special or general investigation for
the purposes of the opinions expressed herein, and have relied solely
upon our examination of the Transaction Documents and such other matters
and documents as are stated in this letter. We have made no independent
verification of the matters stated to be assumed, and express no opinion
in regard thereto, but have no actual knowledge to the contrary.
f. Our opinion is given as of the date hereof, and we undertake
no obligation to advise Seller of any state of facts, or changes in law,
occurring after the date hereof which might affect our opinion. Only
Seller and its successors and assigns (collectively, the "Opinion
Recipient") are entitled to rely upon or to assert any legal rights
created by this opinion letter and the Opinion Recipient's reliance on
the opinions expressed herein shall be only for the purpose contemplated
by the Transaction Documents. This opinion letter may not be used or
relied upon by any other person for any other purpose whatsoever without
in each instance this firm's prior written consent. The opinions
expressed herein do not create or establish an attorney-client
relationship between this law firm, or any of its attorneys and Seller,
and any such relationship is expressly disavowed. No opinion is
rendered beyond the opinions herein expressly stated, and none may be
inferred. The opinion expressed herein does not constitute a guarantee
or insurance of the Transaction or any provisions of the Transaction
Documents for any of the obligations or other matters referred to herein
or therein.
Sincerely,
Frascogna & Courtney PLLC
By:__________________________________
Its: _________________, Member
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 1
CERTIFICATE
This Certificate is made and delivered to Frascogna & Courtney PLLC
("Law Firm"), in connection with the delivery of that law firm's legal
opinion (the "Opinion") to Seller, and it is intended that Law Firm will
rely on this Certificate as to factual matters only in rendering the
Opinion of even date herewith, a copy of which has been furnished to the
undersigned, with regard to the instruments and documents listed therein
(collectively, the "Documents"). It is also intended that the Opinion
Recipient will rely on this Certificate in accepting the opinion and
closing the Transaction.
The undersigned ________ of H & S Fish Farms, Inc., a Mississippi
corporation ("Buyer"), do hereby certify as follows:
1. All representations and warranties of Buyer in the Documents
are true and correct on and as of this date.
2. No event has occurred and is continuing, or would result from
the transactions provided for in the Documents, which has or would
constitute a breach by Buyer of any of the terms of the Documents.
3. The undersigned has reviewed the Documents and has had
discussions with Law Firm concerning the contents of the representations
and warranties contained in the Documents, and the content and substance
of the Opinion to be rendered by Law Firm, and nothing came to the
attention of the undersigned in such review or during such discussions
which would, or could under any foreseeable circumstances, invalidate or
bring into serious question the accuracy of such representations and
warranties or the contents of the Opinion.
4. The undersigned is the officer of Buyer which is the most
familiar with the conduct of the Buyer's business, the execution and
contents of its Transaction agreements, indentures, mortgages, deeds of
trust and other similar agreements and instruments (collectively the
"Material Agreements"), and the existence and contents of any judgments,
orders, writs, injunctions, decrees, rules or regulations (collectively
"Court Order") of any court or governmental department, commission,
board, agency or instrumentality applicable to Buyer. Except for the
Documents, Buyer is not a party or otherwise subject to any Material
Agreement or Court Order, nor are any of its assets subject to a
Material Agreement or Court Order which contains any restriction,
covenant, prohibition or other term or provision by which entering into
and performance of the Documents could either with notice, lapse of time
or both, constitute a violation of, breach, conflict with or a default
under the terms and provisions of any Material Agreement or Court Order.
5. In the course of the review of the Documents, and the Opinion,
no facts or circumstances have come to the attention of the undersigned,
nor are the undersigned aware of any circumstances or facts which, while
to their knowledge would not invalidate any of the above
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 2
statements, might warrant further investigation as to whether or not
such matters might have a bearing on the accuracy or validity of such
statements.
6. Attached as exhibits to the Certificate of Buyer are true,
correct, complete copies, as amended, of the (i) Certificate of
Formation [Incorporation], (ii) Operating Agreement [Bylaws], and (iii)
consents and resolutions relating to its organization, current officers,
directors and shareholders, sale of the Property and execution of the
Documents. The undersigned hereby confirm that (a) there are no
proceedings pending or threatened relating to, and no vote, consent or
meeting has been taken or called for the purpose of, dissolving or
liquidating Buyer and (b) such consents and resolutions are in full
force and effect without any amendment(s) thereto or rescission thereof,
in whole or in part.
7. This Certificate is given after due consideration of the
matters stated herein and the purpose for which this Certificate has
been requested.
Dated: As of _______, 2000.
H & S Fish Farms, Inc.
By:_________________________________
_____________, President
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 1
As of __________, 2000
Farm Fish, Inc.
Attention:______________
100 West Woodrow Wilson Blvd.
Jackson, Mississippi 39213
Re: $1,500,000 mortgage loan (the "Loan") made by Farm Fish, Inc.,
a Mississippi corporation ("Lender") to Borrower (as defined
below) and secured by certain property located in Humphreys
County, Mississippi commonly known as the ___________________
(collectively, the "Property")
Ladies and Gentlemen:
We have acted as counsel for H & S Fish Farms, Inc., a Mississippi
corporation ("Borrower"), in connection with the Loan from Lender to
Borrower. The Loan has closed effective as of the date hereof (the
"Closing Date").
For purposes of this opinion letter, we have relied without
independent investigation upon factual, and not legal, representations
made by Borrower in the Loan Documents and in the attached Certificates
as well as a review of the following instruments and documents:
1. Asset Purchase Agreement between Seller and Buyer, dated
as of ______, 2000 ("Purchase Agreement").
2. Promissory Note, dated as of the Closing Date, executed
by Borrower to the order of Lender in the original principal amount of
$1,500,000.
3. Deed of Trust and Security Agreement dated as of the
Closing Date executed by Borrower in favor of Lender ("Deed of Trust").
4. Receipt and Closing Certificate dated as of the Closing
Date executed by Borrower in favor of Lender.
5. UCC-1 Financing Statements executed by Borrower as debtor
in favor of Lender as secured party to be filed in the following public
offices:
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 2
(a) the Chancery Clerk of Humphreys County, Mississippi; and
(b) the Secretary of State of Mississippi.
6. Certificate of Borrower, dated as of the Closing Date,
together with exhibits attached thereto.
Exhibit A Certificate of Existence/Authority of Borrower, certified
by the Secretary of State of Mississippi.
Exhibit B Certificate of Incorporation of Borrower, certified by
the Secretary of State of Mississippi.
Exhibit C Bylaws of Borrower certified on behalf of Borrower as of
the Closing Date.
Exhibit D Resolutions of Borrower certified on behalf of Borrower
as of the Closing Date.
The instruments referred to in items 1 through 5 above are herein
called the "Loan Documents". The "Borrower Constituent Documents"
(Item 6) are collectively referred to herein as "Constituent Documents".
The instruments referred to in item 5 are herein referred to as the
"Financing Statements".
This Opinion Letter is governed by, and shall be interpreted in
accordance with, the Legal Opinion Accord (the "Accord") of the American
Bar Association Section of Business Law (1991). As a consequence, it is
subject to a number of qualifications, exceptions, definitions,
limitations on coverage and other limitations, all as more particularly
described in the Accord, and this Opinion Letter should be read in
conjunction therewith. The General Qualifications and Specific Legal
Exclusions of the Accord apply to all the Opinions expressed herein.
Except as otherwise indicated herein, capitalized terms used in this
Opinion Letter are defined as set forth in the Accord or, if not defined
in the Accord, the Loan Agreement.
Based upon our examination of the foregoing and other matters of
law or fact deemed appropriate to give the opinions contained herein and
subject to the limitations and qualifications herein set forth, we are
of the opinion that:
a. Borrower is a corporation duly formed, legally existing
and in good standing under the laws of the State of Mississippi and is
qualified to transact business in the State of Mississippi. Borrower
has the power and authority to own its properties and to carry on its
business as now being conducted. Borrower has all requisite authority
to execute and perform its obligations under the Loan Documents and
Financing Statements to which it is a party.
<PAGE>
b. The individuals executing the Loan Documents on behalf
of Borrower have been duly authorized and empowered to do so.
c. All necessary company or corporate action has been taken
to authorize the execution, delivery and performance of the Loan
Documents and Financing Statements by Borrower. All of the Loan
Documents have been duly executed and delivered to Lender by Borrower,
and no consents, permissions or authorizations are required from any
other parties in connection with the execution and delivery of the Loan
Documents.
d. No authorization, consent, approval or other action by,
or filing with, any court or governmental authority of the State of
Mississippi or the United States of America is required in connection
with the execution and delivery by Borrower of the Loan Documents and
the Financing Statements.
e. The Loan Documents are the legal, valid and binding
obligations of Borrower enforceable in accordance with their terms to
the extent such entity or person is a party thereto. The Note is
secured by and entitled to the benefits and security of the Deed of
Trust and the other Loan Documents. The Deed of Trust is in proper form
for filing in the land records of Humphreys County Mississippi. The
Note and the Deed of Trust contain customary and enforceable provisions
such as to render the rights and remedies of the holder thereof adequate
for the realization against the Property of the benefits of the
security, including realization by judicial or non-judicial foreclosure.
f. The execution and delivery of the Loan Documents and
Financing Statements by Borrower do not violate, conflict with, breach,
or constitute (with due notice or lapse of time, or both) a default
under (i) any of the Constituent Documents, (ii) any statute, regulation
or rule, or to our Actual Knowledge, any judgment or decree, applicable
to the Property, or (iii) any existing obligation of Borrower under any
agreement specifically identified as a Material Agreement in the
attached Certificates, and would not, except for liens created by the
Loan Documents, result in the creation or imposition or the obligation
to create or impose a lien upon any of the Property.
g. We have no Actual Knowledge of any actions, suits or
proceedings (including, but not limited to, any bankruptcy proceeding)
pending or threatened against Borrower which, if adversely determined,
would result in any material adverse changes in the condition, financial
or otherwise, of Borrower.
h. The provisions of the Loan Documents are sufficient to
create in favor of Lender a security interest, pursuant to the terms and
provisions thereof, in all right, title and interest of Borrower in
those items and types of collateral described therein to the extent a
security interest may be created under Article 9 of the Uniform
Commercial Code as in effect in the State of Mississippi.
<PAGE>
i. The Financing Statements are in proper form for filing in
the State of Mississippi. The description of the collateral set forth
in the Financing Statements is sufficient to perfect a security interest
in the items and types of collateral described therein to the extent the
collateral is also described in all applicable Loan Documents and to the
extent a security interest may be perfected by the filing of a financing
statement under the Uniform Commercial Code as in effect in the State of
Mississippi.
j. Upon filing of the Financing Statements with, and payment
of all filing fees to, the the Mississippi Secretary of State and the
Chancery Clerk of Humphreys County, Mississippi, which are the only
proper places to file in Mississippi, such filings will be sufficient to
perfect the security interest created by the Loan Documents in all
right, title and interest of Borrower in those items and types of
Property described in the Loan Documents in which a security interest
may be perfected by filing of a financing statement under the Uniform
Commercial Code as in effect in the States of Mississippi.
k. The Loan, as made pursuant to the terms of the Loan
Documents, complies with applicable Mississippi usury laws which
includes Mississippi Code 1972 Annotated Section 75-17-1.
l. Other than nominal recording fees, there are no recording
or mortgage taxes payable in connection with the making of the Loan or
actual recording of the Deed of Trust.
The opinions expressed herein are qualified in the following areas:
a. This opinion is limited in all respects to Federal laws and
the laws of the State of Mississippi. We do not opine as to the laws of
any other state. To the extent required by the opinions set forth
herein, we have assumed that the courts will apply the laws of the State
of Mississippi to the interpretation, construction and enforcement of
the Loan Documents.
b. We have made no examination and express no opinion whatsoever
as to the title to, rights in or condition of any of the Property now or
hereafter constituting a part of the security for the Loan Documents or
as to the existence of any liens, security interests, charges, claims or
encumbrances (collectively, "liens") on any of the Property, or with
respect to the priority of any liens created by the Loan Documents. We
understand that you are obtaining title insurance and UCC searches for
assurances of this nature.
c. We have made no examination and express no opinion whatsoever
with respect to the application of or compliance with any Federal,
state, municipal or other governmental statute, law, rule or regulation
or other legal requirement relating to construction, use, occupancy,
zoning, subdivision, land use, flood plain, conservation, health, safety
or environmental protection or otherwise relating to development or
operation of any of the Property.
<PAGE>
d. References herein to our Actual Knowledge and similar
references shall mean the actual knowledge of (i) our attorneys
substantially participating in the work of this firm with respect to the
transactions evidenced or contemplated by the Loan Documents, based
solely upon our participation as counsel to Borrower, and (ii) our
attorneys, if any, working on any litigation relating to Borrower and
with respect to such groups referred to in (i) and (ii) without in any
manner having conducted any independent investigations in respect of
factual matters; however, we have no reason to believe that any of the
factual matters are untrue.
e. In rendering the portion of the opinions expressed herein in
paragraphs e and k above, we have assumed: (i) the Loan will be
consummated and administered in accordance with the Loan Documents; (ii)
each and every usury savings clause contained in the Loan Documents has
been and will continue to be complied with and such clauses will be held
to be valid, binding and enforceable by all applicable judicial
authority; (iii) no fees, deposits, late charges, sums or other
benefits, whether direct or indirect, have been paid or received, or
are, or may be, payable or receivable by Lender, or any other party,
except as expressly mentioned in the Loan Documents, and none of the
same shall be considered to be "interest" or otherwise for the use,
forbearance or detention of money; (iv) any fees which have been or may
be paid to Lender, or any other party, including, but not limited to,
commitment fees, inspection fees, appraisal fees, recording fees and
attorneys' fees are, or will be, reasonable compensation for services
actually rendered, and are not sums paid for the use, forbearance or
detention of money, (v) if, and to the extent, any fees including but
not limited to commitment fees are interest, such "interest" will be
treated in accordance with the usury savings clauses in the Loan
Documents if such "interest" would otherwise cause the Loan to be
usurious, and (vi) any prepayment fee will not be considered "interest"
or otherwise for the use, forbearance or detention of money.
f. We express no opinion on or concerning any environmental laws
or the environmental or structural condition of any of the Property or
with respect to any activities relating thereto.
g. The opinions expressed in paragraphs e, h, i, and j above are
subject to (i) the rights of the United States under the Federal Tax
Lien Act of 1966, as amended, (ii) applicable bankruptcy, receivership,
insolvency, fraudulent conveyance, reorganization, moratorium or other
laws affecting the enforcement of creditors' rights generally, (iii)
general principles of equity (regardless of whether enforceability is
considered in a proceeding in equity or at law), and (iv) standards of
commercial reasonableness. No opinion is expressed as to the
enforceability of any provisions which purport to: (a) confer self-help
or equitable remedies, such as specific performance and injunctive
relief; (b) establish evidentiary standards for suits or proceedings;
(c) waive the legal rights of any party in advance; (d) alter the
statute of limitation for commencing legal actions in any manner, (e)
permit Lender to accelerate the maturity of the indebtedness evidenced
and governed by the Loan Documents without notice to Borrower or any
other obligor or guarantor, if any, that is a signatory to or bound by
the Loan Documents; (f) allow or authorize the delay or omission of
enforcement of remedies and indemnity or consent judgments; (g) restrict
or prohibit the transfer of title to or further encumbrance of the
Property or to permit Lender to
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 3
charge a transfer or assumption fee or to accelerate the maturity of the
indebtedness which is the subject of the Loan Documents upon the
occurrence of any such transfer or encumbrance; (h) provisions relating
to the appointment of a receiver, to the extent the appointment of a
receiver is governed by applicable statutory requirements and to the
extent any such provision of the Loan Documents may not be in compliance
with any statutory requirements; (i) avoid the doctrine of a mortgagee-
in-possession; (j) establish as to third parties nonculpability for
actions taken by or on behalf of Lender; (k) collaterally assign or
license leases and rents prior to the time that Lender obtains
possession of the Property through foreclosure of the liens against, or
receivership for, the Property or takes some action which is judicially
deemed to be the equivalent thereof; (l) allow Lender to take possession
of any collateral for the Loan prior to a valid foreclosure upon such
collateral; (m) authorize Lender to act as attorney-in-fact for Borrower
or any other entity or person; or (n) select or designate pursuant to a
"venue" provision the procedural laws of a particular jurisdiction. The
opinion expressed in paragraph e above as to the enforceability of the
Loan Documents is further subject to the qualification that the
enforceability of certain of the remedial, waiver and other provisions
of the Loan Documents are further limited by certain municipal, federal
and state, public policy, as well as all governmental and quasi-
governmental authorities, rules and regulations with power over or
applicability to Borrower, the Property or the Lender; however, such
additional laws do not, in our opinion, substantially interfere with the
ultimate realization of the practical benefits expressed in the Loan
Documents, except for the economic consequences of any procedural delay
which may result from such laws.
h. With respect to paragraphs h, i and j above, we do not express
or imply any opinion as to:
i. The creation, perfection or priority of any purported
security interest in any property except as expressly
stated in this opinion. Insofar as the opinions set
forth in this opinion letter relate to the creation,
perfection and effect of perfection or non-perfection of
a security interest, they are limited to collateral
consisting of personal property which is governed under
the Uniform Commercial Code as in effect in the State of
Mississippi. We understand that Lender has specifically
acknowledged that perfection of security interests in
certain of the Collateral under the Loan Documents as
they may relate to the Louisiana Loan requires filing in
a foreign (non-Mississippi) jurisdiction and that Lender
is obtaining and relying on other counsel and separate
assurances with respect to all such matters and
jurisdictions.
ii. The opinions given above as to the creation of security
interests do not cover real property and other property
transactions excluded from the coverage of the Uniform
Commercial Code as in effect in the State of Mississippi.
iii. The existence, perfection and/or priority of any lien
which may be perfected other than by the filing of a
Financing Statement under Article 9 of the Uniform
Commercial Code as in effect in the State of Mississippi
as of the date hereof. Moreover, we specifically have
made no investigation or review of the Federal Tax Lien,
Lis Pendens and Construction Liens Books in the offices
of the Chancery Clerk of Humphreys County, Mississippi or
the Judgment roll in the offices of the Circuit Clerk of
Humphreys County, Mississippi.
iv. The effect on the security interest created in the Loan
Documents of any future occurrence of events contemplated
by, and the limitations imposed under, Section 9-307(3)
(sales other than in the ordinary course of materials or
services) and Section 9-301(4) (rights of lien creditors)
of the Uniform Commercial Code as adopted and in effect
in the State of Mississippi. In addition, under certain
circumstances, described in Section 9-306 of the
Mississippi Uniform Commercial Code, the right of a
secured party to enforce a perfected security interest in
the proceeds of all or any portion of the Property may be
limited.
v. The state of title to any property covered by the Loan
Documents or the existence or priority of any lien,
collateral interest, security interest or other
encumbrance affecting the property covered by the Loan
Documents. We express no opinion as to Borrower's right,
title or interest in or to any Property or as to the
priority of any of the security interests created by the
Loan Documents or any other security interests. We have
not made any examination of title to any property covered
by the Loan Documents and understand that you are relying
on other evidence of title to the extent you deem
appropriate.
vi. The value of the Property covered by the Loan Documents.
vii. The rights of holders of collateral interest in goods
that are or become fixtures under applicable Mississippi
law.
viii.The creation or perfection of any security interest in
fixtures or vehicles or in copyrights, literary property
rights, patents or trademarks or rights or licenses
thereunder.
ix. The creation or perfection of any security interest in
any interest in or claim in or under any policy of
insurance.
x. The perfection of security interests may be terminated as
to any Property acquired by Borrower more than four (4)
months after Borrower changes
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 4
its name, identity or corporate structure so as to make the Financing
Statements referred to above seriously misleading (within the meaning of
Section 9-402(7) of the Mississippi Uniform Commercial Code) unless new,
appropriate financing statements indicating the new name, identity or
corporate structure of Borrower, as the case may be, are properly filed
before the expiration of such four-month period and all fees in
connection therewith are paid. The perfection of security interests in
accounts, including receivables, general intangibles and certain other
Property may be terminated if Borrower changes its principal place of
business or its chief executive office to a location outside Humphreys
County, Mississippi.
i. In reaching the conclusions expressed in paragraphs h, i, and
j above, we have specifically assumed the following:
i. None of the Property consists or will consist of consumer
goods, farm products, crops, timber, minerals and the
like (including oil and gas) or accounts resulting from
the sale thereof, beneficial interests in a trust or a
decedent's estate, letters of credit or items which are
subject to a statute or treaty of the United States which
provides for national or international registration or
national or international certificate of title for the
perfection of a security interest therein or which
specifies a place of filing different from that specified
in the Uniform Commercial Code for filing to perfect such
a security interest;
ii. None of Property consists of goods which are mobile in
nature;
iii. None of the Property consists of accounts or general
intangibles which are or will be due from the United
States or any state of the United States or any agency or
department of the United States or of any state. The
grant of and realization on security interests in
governmental licenses, permits, authorizations and other
rights, in contracts with governments or governmental
instrumentalities, commission, boards or agencies and in
the proceeds thereof are or may be subject to
restrictions or limitations set forth therein or in
applicable statutes, laws, rules or regulations, and we
express no opinion as to the creation or perfection of
security interests in such rights, contracts or proceeds;
iv. Borrower's ownership of the Property;
v. To the extent the Property is currently located in
Mississippi, it will remain located only within the
geographical confines of the First Judicial District of
Humphreys County, Mississippi and that Borrower's
executive offices and principal place of business is in
Humphreys County, Mississippi;
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 5
insofar as perfection in assets not located within Humphreys County,
Mississippi, we hereby exclude and disclaim any and all opinions and/or
representations concerning the effect of the laws of such other
jurisdictions;
vi. The solvency of Borrower and the fairness and adequacy of
the consideration and value received by Borrower in the
transactions contemplated by the Loan Documents;
vii. The validity, sufficiency, completeness and accuracy of
all legal descriptions referenced in the Loan Documents
to be recorded.
j. Pursuant to the Mississippi Uniform Commercial Code
continuation statements are required from time to time to be filed in
order to preserve and continue the effectiveness of the security
interests as valid, perfected security interests securing the Loan.
k. No opinion is expressed herein as to, and we have assumed for
purposes of our opinions the due, valid and proper (i) formation of
Lender, (ii) execution of the Loan Documents by Lender were appropriate
and fully authorized,(iii) performance of the obligations of Lender
thereunder, and (iv) performance of all legal obligations of Lender. We
also express no opinion, and have assumed for purposes of our opinion,
that Lender has the authority to do business in the State of Mississippi
and Lender has complied with all Legal Requirements applicable to Lender
or any contract to which Lender is a party, including the Loan Documents
and payment of all applicable taxes by Lender.
l. The opinions expressed herein are limited to matters of law
and do not constitute any opinions as to, or representations regarding,
matters of fact. Particularly, we express no opinion as to (i) the
financial ability of Borrower to perform or satisfy Borrower's
obligations under the Loan Documents, (ii) the truthfulness or accuracy
of any applications, reports, plans, documents, financial statements or
other matters furnished or to be furnished to Lender by or on behalf of
Borrower to Lender in the Loan Documents, or any other documents
executed in connection with the Loan.
m. We have not conducted any special or general investigation for
the purposes of the opinions expressed herein, and have relied solely
upon our examination of the Loan Documents and such other matters and
documents as are stated in this letter. We have made no independent
verification of the matters stated to be assumed, and express no opinion
in regard thereto, but have no actual knowledge to the contrary.
n. Our opinion is given as of the date hereof, and we undertake
no obligation to advise Lender of any state of facts, or changes in law,
occurring after the date hereof which might affect our opinion. Only
Lender and any successors or assignees of Lender (and any purchaser of
the Loan) (collectively, the "Opinion Recipients") are entitled to rely
upon or to assert any legal rights created by this opinion letter and
the Opinion Recipients' reliance on the opinions expressed herein
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 6
shall be only for the purpose contemplated by the Loan Documents. This
opinion letter may not be used or relied upon by any other person for
any other purpose whatsoever without in each instance this firm's prior
written consent. The opinions expressed herein do not create or
establish an attorney-client relationship between this law firm, or any
of its attorneys and Lender, and any such relationship is expressly
disavowed. No opinion is rendered beyond the opinions herein expressly
stated, and none may be inferred. The opinion expressed herein does not
constitute a guarantee or insurance of the Loan or any provisions of the
Loan Documents or security for any of the obligations or other matters
referred to herein or therein.
Sincerely,
Frascogna & Courtney PLLC
By:__________________________________
Its: _________________, Member
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 1
CERTIFICATE
This Certificate is made and delivered to Frascona & Courtney PLLC
("Law Firm"), and Farm Fish, Inc., a Mississippi corporation ("Lender")
in connection with the delivery of that law firm's legal opinion (the
"Opinion") to Lender, and it is intended that Law Firm will rely on this
Certificate as to factual matters only in rendering the Opinion of even
date herewith, a copy of which has been furnished to the undersigned,
with regard to the instruments and documents listed therein
(collectively, the "Documents"). It is also intended that the Opinion
Recipients will rely on this Certificate in accepting the opinion and
closing the Loan.
The undersigned _______________, as the _______ of H & S Fish
Farms, Inc., a Mississippi corporation ("Borrower"), does hereby certify
as follows:
1. All representations and warranties of Borrower in the
Documents are true and correct on and as of this date. [Manager is the
sole "manager" designated by Borrower's Operating Agreement and no
action has been initiated in any manner to remove Manager as the
"manager" of Borrower.]
2. No event has occurred and is continuing, or would result from
the transactions provided for in the Documents, which has or would
constitute a breach by Borrower of any of the terms of the Documents.
3. The undersigned has reviewed the Documents and has had
discussions with Law Firm concerning the contents of the representations
and warranties contained in the Documents, and the content and substance
of the Opinion to be rendered by Law Firm, and nothing came to the
attention of the undersigned in such review or during such discussions
which would, or could under any foreseeable circumstances, invalidate or
bring into serious question the accuracy of such representations and
warranties or the contents of the Opinion.
4. The undersigned is the officer of Borrower which is the most
familiar with the conduct of the Borrower's business, the execution and
contents of its loan agreements, indentures, mortgages, deeds of trust
and other similar agreements and instruments (collectively the "Material
Agreements"), and the existence and contents of any judgments, orders,
writs, injunctions, decrees, rules or regulations (collectively "Court
Order") of any court or governmental department, commission, board,
agency or instrumentality applicable to Borrower. Except for the
Documents, Borrower is not a party or otherwise subject to any Material
Agreement or Court Order, nor are any of its assets subject to a
Material Agreement or Court Order which contains any restriction,
covenant, prohibition or other term or provision by which entering into
and performance of the Documents or pledging of any of the Property as
security for the Loan could either with notice, lapse of time or both,
constitute a violation of, breach, conflict with or a default under the
terms and provisions of any Material Agreement or Court Order.
5. In the course of the review of the Documents, and the Opinion,
no facts or circumstances have come to the attention of the undersigned,
nor are the undersigned aware of any
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 2
circumstances or facts which, while to their knowledge would not
invalidate any of the above statements, might warrant further
investigation as to whether or not such matters might have a bearing on
the accuracy or validity of such statements.
6. Attached as exhibits to the Certificate of Borrower are true,
correct, complete copies, as amended, of the (i) certificate of
incorporation, (ii) bylaws, and (iii) consents and resolutions relating
to its organization, current officers, acquisition of the Property and
execution of the Documents. The undersigned hereby confirm that (a)
there are no proceedings pending or threatened relating to, and no vote,
consent or meeting has been taken or called for the purpose of,
dissolving or liquidating Borrower and (b) such consents and resolutions
are in full force and effect without any amendment(s) thereto or
rescission thereof, in whole or in part.
7. This Certificate is given after due consideration of the
matters stated herein and the purpose for which this Certificate has
been requested.
Dated: As of _________, 2000.
H & S Fish Farms, Inc.
By:_________________________________
Its: _______________________
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 5
EXHIBIT 3.6(A) - CONTRACTS SCHEDULE
None
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 6
EXHIBIT 3.12(A) - CURRENT EMPLOYEES
See attached.
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 7
Farm Fish, Inc.
Employee List
Elizabeth Ables
Marcus Anderson
Floyd Banks
David Banks
James Clark
Buster Davis
Ed Dew
Jayne Dew
Floyd Dixon
Herbert Ginn
Roosevelt Hill
Neal Hisaw
Sammie Johnson
Roy Lee
Sammy Luke
Nate McGinnis
Randy Miles
James Shiers
Daniel Steward
Leroy Williams
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 7
EXHIBIT 4.3 - NO CONSENT OR VIOLATION
None.
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 8
EXHIBIT 7.1 - SELLER'S CLOSING CERTIFICATE
See attached.
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 9
COMPLIANCE CERTIFICATE OF FARM FISH, INC.
This Compliance Certificate ("Certificate") dated as of _________
(the "Closing Date") is delivered pursuant to Section 7.1 of that
certain Asset Purchase Agreement dated as of July ___, 2000 between H &
S Fish Farms, Inc., a Mississippi corporation ("Buyer") and Farm Fish,
Inc., a Mississippi corporation ("Seller") (the "Purchase Agreement").
The undersigned, _______________, who is __________ of Seller
hereby certifies to Buyer as follows:
1. Each of the representations and warranties made by Seller
in the Purchase Agreement is true and correct in all material respects
on and as of the Closing Date with the same effect as if such
representations and warranties had been made or given on and as of the
Closing Date (except for any changes permitted by the terms of the
Purchase Agreement or consented to in writing by Buyer).
2. Seller has performed and complied in all material
respects with all of Seller's obligations under the Purchase Agreement
which are to be performed or complied with on or prior to the Closing
Date.
3. All conditions precedent to Seller's obligations under
the Purchase Agreement have either been satisfied or waived by Seller.
IN WITNESS WHEREOF, the undersigned has executed this Certificate
as of _________________.
Farm Fish, Inc.
By:_________________________________
Name:_______________________________
Title:________________________________
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 9
EXHIBIT 7.6 - SELLER OFFICER'S CERTIFICATE
See Attached.
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 1
FARM FISH, INC.
CERTIFICATE OF SECRETARY
The undersigned, being the Secretary of Farm Fish, Inc., a
Mississippi corporation ("Seller"), hereby certifies to H & S Fish
Farms, Inc., a Mississippi corporation ("Buyer") that:
1) Attached hereto as Exhibit A is a true, correct and complete
copy of Seller's Articles of Incorporation as in effect and as
certified by the Secretary of State of Mississippi on
______________.
2) Attached hereto as Exhibit B is a Certificate of
Existence/Authority of Seller issued by the Secretary of State
of Mississippi on _____________.
3) No suit, action or other proceeding for the dissolution,
liquidation or termination of Seller has been instituted or is
threatened.
4) There have been no amendments or other documents affecting or
altering Seller's Articles of Incorporation since the date of
the certification referred to in Item 1 above. Seller has,
since the respective date of the certificates referred to in
Items 2 and 3, through the date hereof, remained in good
standing under the laws of the State of Mississippi.
5) Attached hereto as Exhibit C is a true, correct and complete
copy of the Bylaws of Seller as of the date hereof and the
same as was in effect immediately prior to the adoption of the
resolutions referred to in Item 6 below. Such Bylaws have not
been altered or amended and has been in full force and effect
at all times since the adoption of such resolutions through
the date hereof.
6) Attached hereto as Exhibit D is a true, correct and complete
copy of the resolutions of the Board of Directors validly
adopted as of ______ which approved that certain Asset
Purchase Agreement dated as of June ___, 2000 and transactions
contemplated therein. Said corporate action was duly taken,
has been since adoption and is now in full force and effect
and has not been modified in any respect.
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 2
7) The following persons have been elected, have duly qualified
and on the date hereof are officers of Seller holding the
offices set opposite their names and the signatures set
opposite their names are their genuine signatures:
NAME Title SIGNATURE
___________________ __________________ __________________
___________________ __________________ __________________
8) This Certificate is made and delivered for the benefit of
Buyer and Forman, Perry, Watkins, Krutz & Tardy, PLLC, and
each is entitled to rely on the warranties, representation and
facts set forth herein.
IN WITNESS WHEREOF, the undersigned has executed this Certificate
as of the ___ day of ___________, 20__.
Farm Fish, Inc.
By:_________________________________
Name:____________________________
Title:_____________________________
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 11
EXHIBIT 7.7 - CLOSING DOCUMENTS
See Attached.
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 12
Indexing Instructions:
To the Chancery Clerk of Humphreys County, Mississippi:
The real property described
herein is situated in the ____________ Quarter
of Section ___, Township _________,
Range _______ of Humphreys County, Mississippi.
GENERAL WARRANTY DEED
FOR AND IN CONSIDERATION of TEN DOLLARS ($10.00) cash in hand paid,
and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, Farm Fish, Inc., a Mississippi
corporation ("Grantor"), does hereby grant, bargain, sell, convey and
generally warrant unto H & S Fish Farms, Inc., a Mississippi corporation
("Grantee"), certain land and real property lying and being situated in
Humphreys County, Mississippi, more particularly described on EXHIBIT
"A", attached hereto and incorporated herein by reference, together,
with all improvements, tenements, hereditaments and appurtenances
relating or belonging thereto and all rights, title and interests of
Grantor in and to any and all roads, easements, streets and ways within,
adjacent or contiguous thereto.
In addition, this conveyance is made and accepted subject to all
matters set forth in EXHIBIT "B" attached hereto and incorporated herein
by reference. The real property taxes relating to the property conveyed
by this General Warranty Deed have been prorated as of the date hereof.
Therefore, upon the execution of this General Warranty Deed, Grantee
specifically assumes any and all tax liability of any kind associated
with said property.
IN WITNESS WHEREOF, Grantor has executed this General Warranty Deed
as of the ______ day of __________, 20__.
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 13
GRANTOR:
Farm Fish, Inc.
By:_______________________________________
Name:__________________________
Title:___________________________
GRANTOR ADDRESS: GRANTEE ADDRESS:
Farm Fish, Inc. H & S Fish Farms, Inc.
Attention:______________ Attention: _____________
100 West Woodrow Wilson Blvd. _________________________
Jackson, Mississippi 39213 _________________________
Telephone: ____________ __________, Mississippi ______
Telephone: ________________
Prepared by and return to:
Steven M. Hendrix
Forman, Perry, Watkins, Krutz & Tardy, PLLC
Post Office Box 22608
Jackson, Mississippi 39225-2608
Telephone: (601) 960-8600
Facsimile: (601) 960-8609
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 14
STATE OF MISSISSIPPI
COUNTY OF ____________
Personally appeared before me, the undersigned authority in and for
the said county and state, on this ____ day of _________, 2000, within
my jurisdiction, the within named ____________, who acknowledged that he
is _________ of Farm Fish, Inc., a Mississippi corporation, and that for
and on behalf of the said corporation, and as its act and deed he
executed the above and foregoing instrument, after first having been
duly authorized by said corporation so to do.
____________________________________
NOTARY PUBLIC
MY COMMISSION EXPIRES:
____________________
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 15
Exhibit "A"
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 16
Exhibit "B"
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 1
ASSIGNMENT AND ASSUMPTION AGREEMENT
AND SPECIAL WARRANTY BILL OF SALE
This ASSIGNMENT AND ASSUMPTION AGREEMENT AND BILL OF SALE
("Assignment"), is made by and between Farm Fish, Inc., a Mississippi
corporation ("Assignor") and H & S Fish Farms, Inc., a Mississippi
corporation ("Assignee").
W I T N E S S E T H:
WHEREAS, by Asset Purchase Agreement ("Purchase Agreement") dated
as of July __, 2000, by and between Assignor and Assignee, Assignor
agreed to sell to Assignee certain assets and Assignee agreed to assume
certain liabilities as more particularly described in the Purchase
Agreement; and
WHEREAS, the Purchase Agreement provides, INTER ALIA, that Assignor
shall assign to Assignee certain contractual and other intangible
rights, that Assignee shall assume certain of the obligations of
Assignor with respect to the property so assigned from and after the
date of such assignment, and that Assignor and Assignee shall enter into
this Assignment.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, the parties intending to be legally bound
hereto hereby agree as follows:
1. ASSIGNMENT. Assignor hereby sells, conveys, assigns, sets
over and transfers to Assignee all of Assignor's right, title and
interest in and to the following (collectively called the "Personal
Property"):
(i) The items of personal property described on EXHIBIT A
hereto;
(ii) The interest of Assignor under the contracts and
agreements described on EXHIBIT B hereto; and
(iii) Those certain liabilities and obligations of
Assignor described in Section 1.1 of the Purchase Agreement,
but excluding all other liabilities and obligations of
Assignor.
2. ASSIGNEE'S ASSUMPTION AND INDEMNIFICATION. Assignee hereby
assumes the obligation to perform and/or pay any and all Liabilities and
Obligations relating in any manner to the Assumed Liabilities,
including, without limitation, all Liabilities and Obligations arising
or accruing under any of the property described in PARAGRAPH 1 above on
or after the effective date hereof.
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 2
3. LIABILITIES NOT ASSUMED. Except for the Assumed Liabilities,
Assignee is not assuming any Liabilities or Obligations of Assignor in
any manner.
4. EXCLUDED ASSETS. Nothing contained herein shall be deemed to
convey any right, title or interest of Assignor in or to any of the
Excluded Assets.
5. SPECIAL WARRANTY OF TITLE. Assignor does hereby bind itself,
its legal representatives, successors and assigns, to SPECIALLY WARRANT,
and FOREVER DEFEND title to the property conveyed hereby unto Assignee,
its legal representatives, successors and assigns, against every person
whomsoever lawfully claiming or to claim same or any part thereof, by,
through or under Assignor, but not otherwise.
6. MISCELLANEOUS. This Assignment and the obligations of the
parties hereunder shall survive the closing of the transaction referred
to in the Purchase Agreement, shall be binding upon and inure to the
benefit of the parties hereto, their respective legal representatives,
successors and assigns, shall be governed by and construed in accordance
with the laws of the State of Mississippi applicable to agreements made
and to be wholly performed within said State, and may not be modified or
amended in any manner other than by a written agreement signed by the
party to be charged therewith. Initial capitalized terms used but not
otherwise defined herein shall have the meaning ascribed to such term in
the Purchase Agreement.
7. DISCLAIMER OF WARRANTIES. ASSIGNOR MAKES NO WARRANTY, EXPRESS
OR IMPLIED, AS TO ANY OF THE PROPERTY CONVEYED HEREBY OR ITS
MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE. BY ITS
ACCEPTANCE OF THIS ASSIGNMENT, ASSIGNEE ACKNOWLEDGES THAT IT HAS FULLY
INSPECTED THE PROPERTY CONVEYED HEREBY AND THAT IT ACCEPTS THE PROPERTY
CONVEYED HEREBY IN ITS PRESENT USED AND "AS IS" CONDITION. ASSIGNEE
ACKNOWLEDGES AND BY REFERENCE INCORPORATES THE PROVISIONS OF ARTICLE 4
OF THE PURCHASE AGREEMENT. IN ADDITION, THE OBLIGATIONS AND LIABILITIES
OF ASSIGNOR AND ASSIGNEE HEREUNDER ARE SUBJECT TO THE LIMITATIONS AND
PROVISIONS OF SECTION 11.3 SURVIVAL OF REPRESENTATIONS AND WARRANTIES OF
THE PURCHASE AGREEMENT.
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 3
EXECUTED TO BE EFFECTIVE as of the ____ day of _________, 2000.
ASSIGNOR:
FARM FISH, INC.
By:______________________________
Name:__________________________
Title:____________________________
ASSIGNEE:
H & S FISH FARMS, INC.
By:________________________________
Name:_____________________________
Title:______________________________
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 10
EXHIBIT 8.3 - BUYER'S CLOSING CERTIFICATE
See Attached.
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 11
H & S FISH FARMS, INC.
CERTIFICATE OF OFFICER
The undersigned, being the _____________ of H & S Fish Farms, Inc.,
a Mississippi corporation ("Buyer"), hereby certifies to Farm Fish,
Inc., a Mississippi corporation and its successors and assigns
("Seller") that:
1) Attached hereto as Exhibit A is a true, correct and complete
copy of Buyer's Articles of Incorporation as in effect and as
certified by the Secretary of State of Mississippi on
______________.
2) Attached hereto as Exhibit B is a Certificate of
Existence/Authority of Buyer issued by the Secretary of State
of Mississippi on _____________.
3) No suit, action or other proceeding for the dissolution,
liquidation or termination of Buyer has been instituted or is
threatened.
4) There have been no amendments or other documents affecting or
altering Buyer's Articles of Incorporation since the date of
the certification referred to in Item 1 above. Buyer has,
since the respective date of the certificates referred to in
Items 2 and 3, through the date hereof, remained in good
standing under the laws of the State of Mississippi.
5) Attached hereto as Exhibit C is a true, correct and complete
copy of the Bylaws of Buyer as of the date hereof and the same
as was in effect immediately prior to the adoption of the
resolutions referred to in Item 6 below. Such Bylaws have not
been altered or amended and has been in full force and effect
at all times since the adoption of such resolutions through
the date hereof.
6) Attached hereto as Exhibit D is a true, correct and complete
copy of the resolutions of the Board of Directors validly
adopted as of ______ which approved that certain Asset
Purchase Agreement dated as of June ___, 2000 and transactions
contemplated therein. Said corporate action was duly taken,
has been since adoption and is now in full force and effect
and has not been modified in any respect.
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 2
7) The following persons have been elected, have duly qualified
and on the date hereof are officers of Buyer holding the
offices set opposite their names and the signatures set
opposite their names are their genuine signatures:
Name Title Signature
___________________ __________________ ____________________
___________________ __________________ ____________________
8) This Certificate is made and delivered for the benefit of
Seller, Frascogna & Courtney, and each is entitled to rely on
the warranties, representation and facts set forth herein.
IN WITNESS WHEREOF, the undersigned has executed this Certificate
as of the ___ day of __________, 20__.
H & S Fish Farms, Inc.
By:________________________________
Name:____________________________
Title:_____________________________
<PAGE>
Farm Fish, Inc.
As of _______, 2000
Page 11
EXHIBIT 8.6 - OPINIONS
See Attached
<PAGE>
H & S Fish Farms, Inc.
As of ________, 2000
Page 1
As of _______, 2000
H & S Fish Farms, Inc.
_________________________
_________________________
Re: Sale of certain property located in Humphreys County,
Mississippi commonly known as the ___________________
(collectively, the "Property")
Ladies and Gentlemen:
We have acted as counsel for Farm Fish, Inc., a Mississippi
corporation ("Seller"), in connection the sale of the Property (the
"Transaction") by Seller to H & S Fish Farms, Inc., a Mississippi
corporation ("Buyer"). The Transaction has been executed effective as
of the date hereof (the "Effective Date").
For purposes of this opinion letter, we have relied without
independent investigation upon factual, and not legal, representations
made by Seller in the Transaction Documents and in the certificates of
officers of Seller as well as a review of the following instruments and
documents:
1. Asset Purchase Agreement between Seller and Buyer, dated
as of the Effective Date ("Purchase Agreement").
2. Lease Agreement, in the form attached to the Purchase
Agreement to be executed by Buyer as tenant and Seller as landlord prior
to the closing date of the Transaction ("Lease Agreement").
3. Certificate of Seller, dated as of the Effective Date,
together with exhibits attached thereto.
Exhibit A Certificate of Existence/Authority of Seller, certified
by the Secretary of State of Mississippi.
Exhibit B Certificate of Incorporation of Seller, as amended and
certified by the Secretary of State of Mississippi.
Exhibit C Bylaws of Seller certified on behalf of Seller as of the
Effective Date.
<PAGE>
H & S Fish Farms, Inc.
As of ________, 2000
Page 2
Exhibit D Resolutions of Seller and its shareholders certified on
behalf of Seller as of the Effective Date, including a
certified tally of the shareholder vote.
The instruments referred to in items 1 through 2 above are herein
called the "Transaction Documents". The "Seller Constituent Documents"
(Item 3) are collectively referred to herein as "Constituent Documents".
This Opinion Letter is governed by, and shall be interpreted in
accordance with, the Legal Opinion Accord (the "Accord") of the American
Bar Association Section of Business Law (1991). As a consequence, it is
subject to a number of qualifications, exceptions, definitions,
limitations on coverage and other limitations, all as more particularly
described in the Accord, and this Opinion Letter should be read in
conjunction therewith. The General Qualifications and Specific Legal
Exclusions of the Accord apply to all the Opinions expressed herein.
Except as otherwise indicated herein, capitalized terms used in this
Opinion Letter are defined as set forth in the Accord or, if not defined
in the Accord, the Transaction Documents.
Based upon our examination of the foregoing and other matters of
law or fact deemed appropriate to give the opinions contained herein and
subject to the limitations and qualifications herein set forth, we are
of the opinion that:
a. Seller is a corporation incorporated, legally existing
and in good standing under the laws of the State of Mississippi and is
qualified to transact business in the States of Mississippi. Seller has
the corporate power and authority to own its properties and to carry on
its business as now being conducted. Seller has all requisite corporate
authority to execute and perform its obligations under the Transaction
Documents to which it is a party. The individuals executing the
Transaction Documents on behalf of Seller have been duly authorized and
empowered to do so.
b. All necessary company or corporate action has been taken
to authorize the execution, delivery and performance of the Transaction
Documents by Seller. All of the Transaction Documents have been duly
executed and delivered to Buyer by Seller, and no consents, permissions
or authorizations are required from any other parties in connection with
the execution and delivery of the Transaction Documents.
c. No authorization, consent, approval or other action by,
or filing with, any court or governmental authority of the State of
Mississippi or the United States of America is required in connection
with the execution and delivery by Seller of the Transaction Documents.
To the extent that the foregoing relates to any foreign jurisdiction
(other than federal law and Mississippi law), we have not undertaken any
investigation or review of the laws (statutory or otherwise) of any
<PAGE>
H & S Fish Farms, Inc.
As of ________, 2000
Page 3
non-Mississippi (other than federal) jurisdiction, and that Seller is
relying on other counsel with respect to such matters.
d. The execution and delivery of the Transaction Documents
by Seller do not violate, conflict with, breach, or constitute (with due
notice or lapse of time, or both) a default under any of the Constituent
Documents.
e. We have no Actual Knowledge of any actions, suits or
proceedings (including, but not limited to, any bankruptcy proceeding)
pending or threatened against Seller which, if adversely determined,
would result in any material adverse changes in the condition, financial
or otherwise, of Seller.
The opinions expressed herein are qualified in the following areas:
a. This opinion is limited in all respects to Federal laws and
the laws of the State of Mississippi. We do not opine as to the laws of
any other state. To the extent required by the opinions set forth
herein, we have assumed that the courts will apply the laws of the State
of Mississippi to the interpretation, construction and enforcement of
the Transaction Documents.
b. References herein to our Actual Knowledge and similar
references shall mean the actual knowledge of (i) our attorneys
substantially participating in the work of this firm with respect to the
transactions evidenced or contemplated by the Transaction Documents,
based solely upon our participation as counsel to Seller, and (ii) our
attorneys, if any, working on any litigation relating to Seller and with
respect to such groups referred to in (i) and (ii) without in any manner
having conducted any independent investigations in respect of factual
matters; however, we have no reason to believe that any of the factual
matters are untrue.
c. No opinion is expressed herein as to, and we have assumed for
purposes of our opinions the due, valid and proper (i) formation of
Buyer, (ii) execution of the Transaction Documents by Buyer were
appropriate and fully authorized,(iii) performance of the obligations of
Buyer thereunder, and (iv) performance of all legal obligations of
Buyer. We also express no opinion, and have assumed for purposes of our
opinion, that Buyer has the authority to do business in the State of
Mississippi and Buyer has complied with all Legal Requirements
applicable to Buyer or any contract to which Buyer is a party, including
the Transaction Documents and payment of all applicable taxes by Buyer.
d. The opinions expressed herein are limited to matters of law
and do not constitute any opinions as to, or representations regarding,
matters of fact.
<PAGE>
H & S Fish Farms, Inc.
As of ________, 2000
Page 4
e. We have not conducted any special or general investigation for
the purposes of the opinions expressed herein, and have relied solely
upon our examination of the Transaction Documents and such other matters
and documents as are stated in this letter. We have made no independent
verification of the matters stated to be assumed, and express no opinion
in regard thereto, but have no actual knowledge to the contrary.
f. Our opinion is given as of the date hereof, and we undertake
no obligation to advise Buyer of any state of facts, or changes in law,
occurring after the date hereof which might affect our opinion. Only
Buyer and its successors and assigns (collectively, the "Opinion
Recipient") are entitled to rely upon or to assert any legal rights
created by this opinion letter and the Opinion Recipient's reliance on
the opinions expressed herein shall be only for the purpose contemplated
by the Transaction Documents. This opinion letter may not be used or
relied upon by any other person for any other purpose whatsoever without
in each instance this firm's prior written consent. The opinions
expressed herein do not create or establish an attorney-client
relationship between this law firm, or any of its attorneys and Buyer,
and any such relationship is expressly disavowed. No opinion is
rendered beyond the opinions herein expressly stated, and none may be
inferred. The opinion expressed herein does not constitute a guarantee
or insurance of the Transaction or any provisions of the Transaction
Documents for any of the obligations or other matters referred to herein
or therein.
Sincerely,
FORMAN, PERRY, WATKINS, KRUTZ & TARDY,
PLLC
By:__________________________________
Steven M. Hendrix, Member
SMH/ps
<PAGE>
H & S Fish Farms, Inc.
As of ________, 2000
Page 1
CERTIFICATE
This Certificate is made and delivered to Forman, Perry, Watkins,
Krutz & Tardy, PLLC, ("FPWK&T"), in connection with the delivery of
that law firm's legal opinion (the "Opinion") to Buyer, and it is
intended that FPWK&T will rely on this Certificate as to factual matters
only in rendering the Opinion of even date herewith, a copy of which has
been furnished to the undersigned, with regard to the instruments and
documents listed therein (collectively, the "Documents"). It is also
intended that the Opinion Recipient will rely on this Certificate in
accepting the opinion and closing the Transaction.
The undersigned officer(s) of Farm Fish, Inc., a Mississippi
corporation ("Seller"), do hereby certify as follows:
1. All representations and warranties of Seller in the Documents
are true and correct on and as of this date.
2. No event has occurred and is continuing, or would result from
the transactions provided for in the Documents, which has or would
constitute a breach by Seller of any of the terms of the Documents.
3. The undersigned has reviewed the Documents and has had
discussions with FPWK&T concerning the contents of the representations
and warranties contained in the Documents, and the content and substance
of the Opinion to be rendered by FPWK&T, and nothing came to the
attention of the undersigned in such review or during such discussions
which would, or could under any foreseeable circumstances, invalidate or
bring into serious question the accuracy of such representations and
warranties or the contents of the Opinion.
4. The undersigned is the officer of Seller which is the most
familiar with the conduct of the Seller's business, the execution and
contents of its Transaction agreements, indentures, mortgages, deeds of
trust and other similar agreements and instruments (collectively the
"Material Agreements"), and the existence and contents of any judgments,
orders, writs, injunctions, decrees, rules or regulations (collectively
"Court Order") of any court or governmental department, commission,
board, agency or instrumentality applicable to Seller. Except for the
Documents, Seller is not a party or otherwise subject to any Material
Agreement or Court Order, nor are any of its assets subject to a
Material Agreement or Court Order which contains any restriction,
covenant, prohibition or other term or provision by which entering into
and performance of the Documents could either with notice, lapse of time
or both, constitute a violation of, breach, conflict with or a default
under the terms and provisions of any Material Agreement or Court Order.
5. In the course of the review of the Documents, and the Opinion,
no facts or circumstances have come to the attention of the undersigned,
nor are the undersigned aware of any circumstances or facts which, while
to their knowledge would not invalidate any of the above
<PAGE>
H & S Fish Farms, Inc.
As of ________, 2000
Page 2
statements, might warrant further investigation as to whether or not
such matters might have a bearing on the accuracy or validity of such
statements.
6. Attached as exhibits to the Certificate of Seller are true,
correct, complete copies, as amended, of the (i) certificate of
incorporation, (ii) bylaws, and (iii) consents and resolutions relating
to its organization, current officers, directors and shareholders, sale
of the Property and execution of the Documents. The undersigned hereby
confirm that (a) there are no proceedings pending or threatened relating
to, and no vote, consent or meeting has been taken or called for the
purpose of, dissolving or liquidating Seller and (b) such consents and
resolutions are in full force and effect without any amendment(s)
thereto or rescission thereof, in whole or in part.
7. This Certificate is given after due consideration of the
matters stated herein and the purpose for which this Certificate has
been requested.
Dated: As of _______, 2000.
Farm Fish, Inc.
By:_________________________________
_____________, President
<PAGE>
H & S Fish Farms, Inc.
As of ________, 2000
Page 12
EXHIBIT 8.7 - BUYER'S OFFICER'S CERTIFICATE
See Attached.
<PAGE>
H & S Fish Farms, Inc.
As of ________, 2000
Page 13
H & S FISH FARMS, INC.
CERTIFICATE OF OFFICER
The undersigned, being the _____________ of H & S Fish Farms, Inc.,
a Mississippi corporation ("Buyer"), hereby certifies to Farm Fish,
Inc., a Mississippi corporation and its successors and assigns
("Seller") that:
1) Attached hereto as Exhibit A is a true, correct and complete
copy of Buyer's Articles of Incorporation as in effect and as
certified by the Secretary of State of Mississippi on
______________.
2) Attached hereto as Exhibit B is a Certificate of
Existence/Authority of Buyer issued by the Secretary of State
of Mississippi on _____________.
3) No suit, action or other proceeding for the dissolution,
liquidation or termination of Buyer has been instituted or is
threatened.
4) There have been no amendments or other documents affecting or
altering Buyer's Articles of Incorporation since the date of
the certification referred to in Item 1 above. Buyer has,
since the respective date of the certificates referred to in
Items 2 and 3, through the date hereof, remained in good
standing under the laws of the State of Mississippi.
5) Attached hereto as Exhibit C is a true, correct and complete
copy of the Bylaws of Buyer as of the date hereof and the same
as was in effect immediately prior to the adoption of the
resolutions referred to in Item 6 below. Such Bylaws have not
been altered or amended and has been in full force and effect
at all times since the adoption of such resolutions through
the date hereof.
6) Attached hereto as Exhibit D is a true, correct and complete
copy of the resolutions of the Board of Directors validly
adopted as of ______ which approved that certain Asset
Purchase Agreement dated as of June ___, 2000 and transactions
contemplated therein. Said corporate action was duly taken,
has been since adoption and is now in full force and effect
and has not been modified in any respect.
<PAGE>
H & S Fish Farms, Inc.
As of ________, 2000
Page 14
7) The following persons have been elected, have duly qualified
and on the date hereof are officers of Buyer holding the
offices set opposite their names and the signatures set
opposite their names are their genuine signatures:
NAME TITLE SIGNATURE
___________________ __________________ ___________________
___________________ __________________ ___________________
8) This Certificate is made and delivered for the benefit of
Seller, Frascogna & Courtney, and each is entitled to rely on
the warranties, representation and facts set forth herein.
IN WITNESS WHEREOF, the undersigned has executed this Certificate
as of the ___ day of __________, 20__.
H & S Fish Farms, Inc.
By:________________________________
Name:____________________________
Title:_____________________________
<PAGE>
H & S Fish Farms, Inc.
As of ________, 2000
Page 1
EXHIBIT B
PLAN OF LIQUIDATION OF FARM FISH, INC.
This Plan of Liquidation (the "Plan") is for the purpose of
effecting the complete liquidation of Farm Fish, Inc. ("Farm Fish"), a
Mississippi Corporation, and the dissolution of Farm Fish under the
Mississippi Business Corporation Act.
1. At the record date, Farm Fish had issued and outstanding
2,688,605 shares of common stock. Farm Fish will cease the active
conduct of its business and distribute all of its assets in complete
liquidation, less any assets retained to meet claims, in accordance with
this Plan.
2. The Board of Directors of Farm Fish shall be deemed trustees
and shall take all steps necessary to wind up the affairs of Farm Fish.
3. The officers and directors of Farm Fish are authorized to sell
or otherwise liquidate any and all of the assets of the Farm Fish which
in their judgment should be sold or liquidated, and on such terms and
conditions as described in this Paragraph, to make payments of taxes and
other liabilities, and to make distributions of the assets of Farm Fish,
in cash or in kind, in one or in a series of distributions in complete
liquidation as follows:
(a) First, to the payment and discharge of all Farm Fish's
debts and liabilities to creditors including, but not limited to, the
payment of all state and federal taxes;
(b) Second, to the payment and discharge of all the Farm
Fish's debts and liabilities incurred in the process of winding up its
affairs and liquidating its assets;
(c) Third, to the payment and discharge of all Farm Fish's
debts and liabilities to Shareholders and their Affiliates; and
(d) Thereafter, to the Shareholders pro rata according to the
number of shares of Farm Fish stock held.
4. Each of the foregoing distributions in complete liquidation
shall be solely in exchange for, in complete redemption and cancellation
of, and in complete payment for, all of the outstanding stock of Farm
Fish, and the Shareholders shall, if the Board of Directors of Farm Fish
so determines, surrender the stock certificates for cancellation on
receipt of the final distribution authorized by the Plan.
5. After the distributions referred to in Paragraph 3 are made,
Farm Fish shall not engage in any business activities. The directors
then in office, and at the pleasure of the directors, the officers then
in office, shall continue in office solely to wind up Farm Fish's
business and affairs. No action shall be taken that is inconsistent
with the status of liquidation and that status shall continue until the
date Farm Fish is dissolved.
6. As soon as practicable after Farm Fish's property is
distributed to its Shareholders, the officers and directors of Farm Fish
shall proceed with the voluntary dissolution of the Corporation under
the laws of the State of Mississippi, and they are authorized,
empowered, and directed to execute and file all documents which they
deem necessary or advisable to carry out the purposes and intentions of
the Plan.
7. The officers and directors of Farm Fish shall have authority
to carry out and consummate this Plan, including authority:
(a) to do, on behalf of Farm Fish, all acts required to be done by
Farm Fish under this Plan; and
(b) to adopt all resolutions, execute all documents, file all
papers, and take all other action deemed necessary or appropriate to
effect the dissolution of Farm Fish and the complete liquidation of its
business, assets and affairs.
