HomeMy WebLinkAboutAgenda - 06-24-1986 ir" _
1
APPROVED AUGUST 19, 1986
MINUTES
ORANGE COUNTY BOARD OF COMMISSIONERS
SPECIAL MEETING
JUNE 24, 1986
The Orange County Board of Commissioners met in special session on June
24, 1986, 7:30 p.m. at Lincoln Center in Chapel Hill, North Carolina.
BOARD MEMBERS PRESENT: Chair Don Willhoit and Commissioners Shirley
Marshall, Moses Carey, Ben Lloyd and Norman Walker.
ATTORNEY PRESENT: Geoffrey Gledhill.
STAFF PRESENT: County Manager Kenneth R. Thompson, Assistant County
Managers Albert Kittrell and William- - T. Laws, Director of Finance Gordan
Baker, Recreation and Parks Director Mary Anne Black, Clerk to the Board
Beverly A. Blythe, Director of Finance Pam Jones, Budget Analyst Donna
Wagner and Director of Personnel Beverly Whitehead.
A. ITEMS FOR DECISION
1. POLICY REGARDING ISSUANCE OF PROCLAMATION
2. GAY AND LESBIAN PROCLAMATION
Chair Don Willhot presented for consideration a policy question
whereby the authority to issue proclamations can be clarified. This policy
question was prompted because of an Anti-discrimination proclamation that
was signed by the Chair. He emphasized the proclamation was not issued on
behalf of the Board but issued as an individual. He further stated that
although he neither condones or condemns the gay lifestyle, he is committed
to opposing discrimination of people on the basis of sexuality.
Commissioner Walker spoke in opposition of the proclamation and
the signing of the proclamation by the Chairman.
Commissioners Marshall and Carey indicated they were informed by
the Chair of the proclamation and although they were not asked to sign they
endorsed the concept of anti-discrimination on any basis.
Attorney Geoffrey Gledhill stated that a proclamation is more
ceremonial which does not have the effect of law or describe the duties of
the Board of County Commissioners. A proclamation such as this is not law
and does not have the affect of law and imposes no legal obligations on
County government. This act does not represent a legal function of the
Board.
Commissioner Lloyd questioned the authority of the Chair to issue
the proclamation on behalf of the Board.
Chair Willhoit clarified he did not issue the proclamation on
behalf of the Board of County Commissioners.
Commissioner Walker stated his opposition against the lifestyle of
homosexual and lesbian practices and cited statistics associated with AIDS.
A motion was made by Commissioner Walker, seconded by
Commissioner Lloyd to disapprove the Anti-
discrimination proclamation.
VOTE: AYES, 2; NOES, 3 (Chair Willhoit and Commissioners Marshall and
Carey)
A motion was made by Commissioner Carey, seconded by Commissioner
Marshall to table the issue of adopting a policy on the issuance of
proclamations until the new board is seated in December.
VOTE: AYES, 3; NOES, 2 (Commissioners Lloyd and Walker) .
2
After a short discussion on the purpose of this item being placed
on the agenda, citizens who desired to speak were heard.
Those who spoke in opposition of the issuance of the proclamation
were David Smith, Cheryl Atwater, Currie Parker, Doug Emerson, Philip Moore,
Jim Moore, Gary Webb, Frank Thacker, Benny Cecil, Gordon Barbour, and Calvin
Ashley.
Those who spoke in support of the issuance of the proclamation
were Robert Seymour and Paul Lindsay.
Other speakers were John Hartwell and Robert O'Keef.
3. ISOTECHNOLOGIES, INC. REVENUE BONDS
(A copy of the resolution is on pages of the official
minute book) .
Motion was made by Commissioner Carey, seconded by Commissioner
Marshall to adopt the resolution entitled "Resolution approving the issuance
by the Orange County Industrial Facilities and Pollution Control Financing
Authority of its Industrial Revenue Bond (Isotechnologies, Inc. Project) in
a principal amount not to exceed $1,500, 000 to Finance an Industrial Project
for Isotechnologies, Inc.
VOTE: UNANIMOUS. (Commissioners Lloyd and Walker were not present)
4. BUDGET AMENDMENTS
Motion was made by Commissioner Marshall, seconded by Commissioner
Carey to amend the 1985-86 Budget Ordinance as follows:
GENERAL FUND
Appropriation - Social Services $ 254,901
Source - Social Services Day Care $ 254,901
Appropriation - Social Services $ 54, 150
Source - Social Services - Long Care Care $ 54,150
VOTE: UNANIMOUS. (Commissioners Lloyd and Walker were not present)
5. 1986-87 BUDGET ADOPTION
(A copy of the Interim Operating Budget for 1986-87 is on pages
of the official minute book) .
Motion was made by Commissioner Carey, seconded by Commissioner
Marshall to adopt an interim operating budget for the County of Orange for
the fiscal year beginning July 1, 1986 and ending June 30, 1987, the same
being adopted by fund and activity.
VOTE: UNANIMOUS. (Commissioners Lloyd and Walker were not present in the
room at the time this vote was taken) .
ADJOURNMENT
With no further business to come before the Board, Chair Wilihoit
adjourned the meeting. The next regular meeting will be held on July 7,
1986, 7: 30 p.m. in the Commissioners Room of the Orange County Courthouse,
Hillsborough, North Carolina.
Don Wilihoit, Chair
Beverly A. Blythe, Clerk
r
w
ORANGE COUNTY
BOARD OF COMMISSIONERS
AGENDA
SPECIAL MEETING
TUESDAY, JUNE 24, 1986
7:30 P.M.
LINCOLN CENTER BOARD ROOM
CHAPEL HILL, N.C.
PAGE # A. ITEMS FOR DECISION
001 1. Policy Regarding Proclamation Issuance
002 2 . Gay and Lesbian Proclamation
003 3 . Isotechnologies, Inc. Revenue Bonds
004 4. Budget Amendments
5. 1986-87 Budget Adoption
B. ADJOURNMENT
e
INTERIM OPERATING BUDGET 1986-87
ORANGE COUNTY, NORTH CAROLINA
SECTION I. BUDGET ADOPTION 1986-87 There is hereby adopted the following Interim Operating
Budget for the County of Orange for this fiscal year beginning July 1, 1986 and ending June 30.
1987, the same being adopted by fund and activity.
SECTION II. INTERIM APPROPRIATION: That for said fiscal year there is hereby appropriated
out of the funds the following:
DEPT/AGENCY APPROPRIATION DEPT/AGENCY APPROPRIATION
General Fund:
County Commissioners $ 37,688 Adolescents In Need
$ 7,625
Courts 4,512 Volunteers for Youth 250
Elections 31,615 Home Health Agency 5,000
Register of Deeds 76,189 Planned Parenthood 2,500
Soil and Water 17, 304 Women's Center 1,500
County Manager 53,596 OPC Mental Health 88,937
Personnel 37,116 Municipal Support-Recreation-CH 15,440
Finance 50, 350 Municipal Support-Recreation-Carr 6, 600
Purchasing 15,827 Municipal Support-Recreation-Meb 625
Tax Supervisor 106,381 Library-Chapel Hill 29,828
Land Records 32,941 Library-Hyconeechee 40,281
Tax Collector 39,579 Library-Mebane 139
Child Support Enforcement 22,973 Dispute Settlement Center 3,000
Data Processing 62, 808 Historical Commission 750
Planning 143,588 JOCCA 11,991
Economic Development 16,268 Museum 1, 000
Central Services 122, 937 Sheaffer House 32, 315
Social Services 780, 457 Arts Commission 187
Health 387, 009 Rape Crisis 3, 375
Agricultural Extension 35,570 Battered Women 2, 750
Emergency Food Assistance 625 Women's Health 3, 050
Recreation 83,961 Child Care Networks 7, 650
Aging 64,030 Debt Service 197, 856
School-Curr. Exp. - CH 1,039,015 Transfer to Revaluation 15, 725
School-Curr. Exp. - Orange 983, 316 Transfer to County Capital Reserve 74, 250
School - Capital - CH 333,887 Contingency 12, 500
School - Capital - Orange 518,500
Commission for Women 7,345
Sheriff 509,966
ABC 17,109 Total General Fund Appropriation: 6,808,848
Emergency Services 217,277
Forest Services 8,640 Revaluation Fund 40, 339
Medical Examiner 2,500 Data Processing Enterprise Fund 16,875
Public Works 382,385 Emergency Services In Flight Fund 57, 428
Lake Orange 500
SECTION III. INTERIM REVENUES: It is estimated that the following Fund Revenues will be
available during the fiscal year beginning July 1, 1986 and ending June 30, 1987 to meet the
foregoing Appropriations.
General Fund:
Taxes (excluding property 5,075,791 Data Processing Enterprise Fund: 16,875
taxes) Charges for Services
Licenses and Permits 54,701
Intergovernmental Revenue 966,329 Emergency Services - In-Flight Fund: 57,428
Charges for Services 269, 961 Reimbursement for Services
Interest on Investments 70, 625
Miscellaneous Revenues 41,054
Transfers from Other Funds 330,387
Total General Fund 6,808,848
Revaluation Fund:
Transfer from General Fund 40, 339
Total Revaluation Fund 40,339
This Interim Budget being duly adopted this6�day of 1986.
T
Bever y A. B he, Cler Don Willhait, air
Orange Count Board of Commissioners Orange County Board f Commissioners
z' -Shir rshall, Vice Chair
Ben Lloyd
Norman Walker
M6se6 Carey
Doi
ORANGE COUNTY
BOARD OF COMMISSIONERS Action Agenda
ACTION AGENDA ITEM ABSTRACT Item No. Al,
Meeting Date: JUNE 24, 1986
SUBJECT: POLICY REGARDING PROCLAMATION ISSUANCE
DEPARTMENT: COMMISSIONERS PUBLIC HEARING: Yes X No
ATTACHMENT(S) : INFORMATION CONTACT: DON WILLHOIT
X505
TELEPHONE NUMBER:
Hillsborough - 732-8181
Chapel Hill - 968-4501
Mebane - 227-2031
Durham - 688-7331
PURPOSE: To consider establishing policy whereby the authority to issue
proclamation can be clarified.
NEED: Unlike contracts, proclamations are symbolic
do not have the effect of binding th ountydinlanytway. which
are usually written by the sponsors of a function. They serve
the purpose of drawing attention to an event or observance that
is taking place in the community at a particular time. In this
sense a proclamation serves as a form of publicity for the
event.
Because of the number of proclamations brought forth by commu-
nity groups and their non-binding content many cities have
authorized their mayors to sign them without appearing on an
agenda.
Issues brought up with regard to the issuance of the Anti
Discrimination Proclamation were:
1. Whether the Chair of the Board had authority to sign the
proclamation.
2. Whether citizens of the County thought it was coming from
the Board.
Since proclamations are not specifically addressed in the
Board's Rules and Procedure Guide clarification of responsibi-
lity and procedure for proclamation issuance is needed.
RECOMMENDATION(S) :
As the Board decides.
Doe
ORANGE COUNTY Action Agen' ,--BOARD OF COMMISSIONERS Item No. - .- ...
ACTION AGENDA ITEM ABSTRACT
DING DATE June 24, 1986
Subject: Gay and Lesbian Proclamation
Department: BOARD OF COMMISSIONERS I Public Hearing: Yes - X no
Attachments: Information Contact: Commissioner
Norman Walker
Phone Numbers: 732-8181, 968-4501,
227-0231
PURPOSE:Board Action on this document.
NEED: The Chairman signed a proclamation honoring Gays and Lesbians because of their great
contribution as citizens to the political, spiritual, artistic and civic life of our County, State
and Nation.
He did not have authority to do this. Under North Carolina law and our own adopted rules of
procedure it takes a majority of the Board members with a quorum present to take official action_
No Commissioner can act for us unless we authorize him to do so in a public meeting.
A greater problem with the proclamation is that under the cloak of anti-discrimination this
proclamation promotes and elevates homosexual and lesbian practices. It should be pointed out
to these people and to the County citizens what the law says about the subject and what modern
medical science says are dangers connected with that lifestyle.
North Carolina law G.S. Article 26, section 14-177 defines a Crime against nature: "If any
person shall commit the crime against nature, with mankind or beast, he shall be punished as a Class
felon.
Medical authorities tie homosexuality to Acquired Immune Deficiency Syndrone (AIDS). Here
are some of the statistics:
1. Of the 13,000 cases in the U.S., 73% are gay men.
2. AIDS is the leading cause of death in San Francisco and New York for men between the
ages of 25 & 44 who have never been married. It is second to cancer for cause of death
among this age group for men.
3. In the news this past week another medical authority with the Center for Communicable
Disease Control in Atlanta said AIDS victims would soon exceed highway fatalities as the cau-
of death in the country.
OOv
4. Current estimates are that the number of cases in this country will double every
12 months. If this happens, in five years half a million people in the U.S. will
contract AIDS and between four and five million Americans will be carriers.
5. It is fatal to those who get it.
6. AIDS has resisted all forms of treatment to date. For now the only way it can be
stopped is for homosexuals to change their lifestyle.
We as a Board must uphold the health, safety and welfare as protectors of all the citizens.
RECOMMENDATION:
Since Homosexuality practice is against the law of the State of North Carolina and appears
to be against the Health, Safety and Welfare of our citizens, I move to disapprove the
P oclairkatiop.-
r --
ORANGE COUNTY U o'
BOARD OF COMMISSIONERS ACTION AG NDA
ACTION AGENDA ITEM ABSTRACT ITEM NO.
MEETING DATE June 24, 1986
•
SUBJECT: Orange County Industrial Facilities and Pollution Control
Financing Authority -- Isotechnologies, Inc. Project •
DEPARTMENT: Economic Development I PUBLIC HEARING: YES X NO -
ATTACHMENT(S) : Yes INFORMATION CONTACT: Sylvia Price
(FINANCIAL DOCUMENTS ARE AVAILABLE PHONE NUMBERS: HILLSBOROUGH - 732-8181
IN THE CLERK TO THE BOARD OF HILLSBOROUGH - 732-9361
COMMISSIONERS OFFICE) CHAPEL HILL - 967-9251
MEBANE - 227-2031
DURHAM - 688-7331
RMWaX
The Orange. County Industrial Facilities and Pollution . Con-
trol Financing Authority (the "Authority") has met and has taken
the following _action in connection with the proposed issuance and
sale of the Authority ' s Industrial Revenue Bonds for the
Isotechnologies, Inc. Project: •
1. approved the form of a Loan Agreement, to be dated .
!OX as of July 1, 1986, by and between ' the Authority and
Isotechnologies, Inc. (the "Company") ;
2. approved and authorized the endorsement without
recourse and pledge of a promissory note of the Company, to
be dated as of July 1, 1986;
3. approved the form of an Assignment, to be dated as
of July 1, 1986, from the Authority to NCNB National Bank of
North Carolina (the "Purchaser") ;
4. authorized the borrowing under and the issuance
and performance of the Authority' s Industrial Revenue Bond
(Isotechnologies, Inc. Project) , in a principal amount not
to exceed $1,500,000, and direct the execution and delivery.
cX of said Bond;
5. approved the form of the Bond Purchase Agreement,
to be dated as of July 1, 1986, by and among the Authority,
the Purchaser and the Company, providing for the issuance
and sale of the Bond;
6. approved the form of the Security Agreement, to be
dated as of July 1, 1986, by and between the Company and the
Authority;
RECOMMENDATION(Si: Approve the Resolution
00"
7. approved the form of the Deed of Trust, to be
dated as of July 1, 1986, from the Company to Charles E.
Harris as trustee for the benefit of the Authority; and
8 . approved the form of a Guaranty Agreement, to be
dated as of July 1, 1986, from the Company to the Purchaser.
9. approved the form of a Guaranty Agreement, to be
dated as of July 1, 1986, from Mr. and Mrs. Jerome J.
Richardson to the Purchaser.
The application of the Authority to the North Carolina
Department of Commerce for its approval of the Isotechnologies
Project and the issuance of the bonds has been approved by the
Department of Commerce.
North Carolina General Statutes Section 159C-4 (d) provides,
in part, that "No bonds shall be issued [by a local bond
Authority] under the provisions of [Chapter 159C - Industrial and
Pollution Control Facilities Financing Act] unless the issuance
thereof shall have been approved by the governing body of the
county. "
The Authority and Isotechnologies, Inc. request the approval
by the Board of Commissioners of the issuance of the bonds.
06lb
(19)
THE BOARD OF COMMISSIONERS
FOR
THE COUNTY OF ORANGE, NORTH CAROLINA
The Board of Commissioners for the County of Orange, North
Carolina, met in special session in the Board Room of Lincoln
Center in Carrboro, North Carolina, at 7:30 P.M. , June 24, 1986.
Present: Chairman , presiding, and
Commissioners
Absent: •
Also present: Geoffrey E. Gledhill, Orange County Attorney;
Commissioner introduced the following resolution,
a copy of which had been distributed to each Commissioner and the
title of which was read:
RESOLUTION APPROVING THE ISSUANCE BY THE ORANGE COUNTY
INDUSTRIAL FACILITIES AND POLLUTION CONTROL FINANCING
AUTHORITY OF ITS INDUSTRIAL REVENUE BOND
(ISOTECHNOLOGIES, INC. PROJECT) IN A PRINCIPAL AMOUNT
NOT TO EXCEED $1, 500,000 TO FINANCE AN INDUSTRIAL
PROJECT FOR ISOTECHNOLOGIES, INC.
BE IT RESOLVED by the Board of Commissioners for the County
of Orange:
00
Section 1. The Board of Commissioners has determined and
does hereby declare as follows:
(a) The Board of Commissioners of The Orange County
Industrial Facilities and Pollution Control Financing Authority
(herein referred to as the "Authority") has met and has taken the
following action in connection with the proposed issuance and sale
of the Authority' s Industrial Revenue Bond (Isotechnologies, Inc.
Project) , in a principal amount not to exceed $1,500,000:
1. approved the form of a Loan Agreement, to be dated
as of July 1, 1986, by and between the Authority and
Isotechnologies, Inc. (the "Company" ) ;
2 . approved and authorize the endorsement without
recourse and pledge of. a promissory note of the Cappany, to
be dated as of July 1, 1986;
3 . approved the form of an. Assignment, to be dated as
of July 1, 1986, from the Authority to NCNB National Bank of
North Carolina (the "Purchaser" ) ;
4. authorized the borrowing under and the issuance and
performance of the Authority' s Industrial Revenue Bond
( Isotechnologies, Inc. Project) , in a principal amount not to
exceed $1,500, 000, and direct the execution and delivery of
said Bond;
5. approved the form of the Bond Purchase Agreement, to
be dated as of July 1, 1986, by and among the Authority, the
2.
ooh
Purchaser and the Company, providing for the issuance and
sale of the Bond;
6. approved the form of the Security Agreement, to be
dated as of July 1, 1986, by and between the Company and the
Authority;
7. approved the form of the Deed of Trust, to be dated
as of July 1, 1986, from the Company to Charles E. Harris as
trustee for the benefit of the Authority; and
8. approved the form of a Guaranty Agreement, to be
dated as of July 1, 1986, from the Company to the Purchaser.
9. approved the form of a Guaranty Agreement, to be
dated as of July 1, 1986, from Mr. and Mrs. Jerome J.
Richardson to the Purchaser.
(b) The Board of Commissioners for the County of Orange has
reviewed the action to be taken by the Board of Commissioners of
the Authority in connection with the issuance and sale of the Bond
and has made such other examination and investigation as it deems
necessary and relevant as the basis for the approval set forth
herein.
Section 2. Pursuant to and in satisfaction of the require-
ments of Section 159C-4(d) of the General Statutes of North
Carolina, the Board of Commissioners for the County of Orange
hereby approves the issuance by the Authority of its Industrial
Revenue Bond (Isotechnologies, Inc. Project) in a principal amount
not to exceed $1,500,000.
3 .
00
Section 3. This resolution shall take effect immediately
upon its passage.
Commissioner moved the passage of the foregoing
resolution and Commissioner seconded the motion, and the
resolution was passed by the following vote:
Ayes: Commissioners
Noes:
* * * *
I, Beverly A. Blythe, Clerk to the Board of Commissioners for
the County of Orange, North Carolina, DO HEREBY CERTIFY that the
foregoing is a true and complete copy of so much of the
proceedings of the Board of Commissioners for said County at a
special meeting held on June 24, 1986, as relates in any way to
the approval hereinabove set forth.
I DO HEREBY FURTHER CERTIFY that notice of said meeting of
said Board of Commissioners, signed by the Chairman of said Board
and stating that a special meeting of said Board would be held at
7:30 P.M. on June 24, 1986, in the Board Room of Lincoln Center in
Carrboro, North Carolina, concerning the passage of a resolution
approving the issuance by the Orange County Industrial Facilities
and Pollution Control Financing Authority of its not to exceed
$1, 500,000 Industrial Revenue Bond ( Isotechnologies, Inc.
Project) , was, at least six hours before said meeting, delivered
4.
•
1 c
to each Commissioner or left at his or her usual dwelling place
and, at least forty-eight hours before said meeting, posted on the
principal bulletin board of said Board and mailed or delivered to
each newspaper, wire service, radio station, television station
and person that had filed with me a written request for, notice
pursuant to G.S. 143-318. 12.
WITNESS my hand and the common seal of said County, this 24th
day of June, 1986.
Clerk to the Board of Commissioners
[Seal]
5.
ORANGE -COUNTY
BOARD. OF CO MISSIONERS . O1. JICTIO . AGENDA
ACTION AGENDA ITEM ABSTRACT . ITEM NO.mf.
FLEETING DATE June 24, 1986
•
SUBJECT: • Proposed Budget Amendments
DEPARTMENT: Finance . [ PUBlIC HEAP,IUG: YES X 1'10
ATTACHMENT(S) : INFO:'iAT10i CONTACT: Donna Wagner
Proposed Budget Amendment PHONE NUMBERS: HILLSBOP..OUGH 73?_--8181
Hll_1_Sf3OROUGU 732-9361
CHAPEL HILL. - 967-9251
iiEBANE - 227,2031
DURHAM 628--7331
PURPOSE: Consideration of proposed budget amendment. -
•
•
NEED: GENERAL FUND
•
1. To budget for additional consolidated day care funds allocated to Orange
County-by the State.
2. To budget for additional Long Term Care Screening revenues to be received
by Orange County Department of Social Services. '
•
•
•
IMPACT: GENERAL FUND
• 1. This amendment will increase day care funds =for -the Department of
Social Services with 100% State funds. -
2. This amendment will increase Long Term Care funds for the Department
of Social Services. -
•
RFCC)i•;mEND 11 f O;v($) : Approve .the motion to amend the 1985-86 Budget Ordinance
- by proposed amendment.
P1r
ORANGE COUNTY
PROPOSED
1985-86 BUDGET AMENDMENT
The 1985-86 Budget Ordinance as adopted on July 3, 1985, and subsequently
amended, is hereby amended as follows:
BEFORE AFTER
AMENDMENT AMENDMENT AMENDMENT
GENERAL FUND
Appropriation:
Social Services $2,804,821 $254,901 $3,059,722
Source:
Social Services-Day Care 261,409 254,901 516,310
To budget for additional Day Care Revenues.
Appropriation: -
Social Services $ 87,681 $ 54,150 $ 141,831
Source;
Social Services-Long Term Care 92,795 54,150 146,945
To budget for additional Long Term Care Revenues.
Approved this 24 day of June 1986.
y
i
1
i
APPLICATION FOR APPROVAL OF P
(Pursuant :, PROJECT
The Oran to G.S.G 159C_7)•
Control Financing e
q ncin
corporate 9 Author►t C°dht�)nd
r adopted and politic of the(the "Authority") Industrial Facilities
°r' °n by the Board of Comm State of North Carolina created subdivision Pollution
159 Maw ss�oner arolina on and
il
C of the G , 1g 79 s forth.. Co created b body
,!�
Secretary Genera/Statutes 9 , in accordan County of y resolution
Y of the es of Nor c' with
Pursuant Department Stat North Car the provisions
olina_ P visions of a
including the the Provisions of f Commerce o the "Act") hereby file Chapter
project described attached Section 159C-7 the State of No s with the
,,Operator" ed herein hereto for of the Act North Carolina
), the (the ,.p appr.v , this a
Pursuant to the Project to be financed for x_al of its proposed
Secretary Act, The anced b °technos industrial
Y of the Authority Y an iss °'ies
Section 159C_7 of he Act.
ransm�tte. a Of bonds of the Inc. (the
Dated.
ated: ct, mission o North Carolina filing to t Authority
he
A rz1 28 Pursuant to
1986
ORANGE
FACILITIES COUNTY No
FIES N D OLLUTION C USTRIAL
AUTI-IORIT'rRoL
By ` ,
CH •
CHA
To be filed With
Bruce Strickland.
Industrial Financing Chief
N.C. Department�n9 Section
430 North Salisbury t of C •
Ral No NCS Street
. PHONE 919-733-5297 _
January 1, 1983
iimmimilailiamiim„
Post Office Box 640
501 S.Greensboro St., Bldg. B
Carrboro, North Carolina 27510
OF* 919-929-7791
ISr`"�--i-- U1� Ii�1 inrlC�
�+ I ECH rtu`uu E=
INC
EXHIBIT A
THE PROJECT
Isotechnologies, Inc. , a Carrboro, N.C. , company, is seeking financial
support in the form of Industrial Revenue Bonds to finance the acquisition of
land and the construction of a new 25,000 square foot manufacturing facility
to house its entire operations in Hillsborough, N.C. In addition to the real
estate and the building itself, the money derived via these bonds will be used
for the acquisition of equipment required for its routine research,
development and manufacturing, and marketing operations and for the required
furnishings for its offices and showroom. You will find at the end of this
exhibit a tabular summary itemizing where the money will be spent, including
the required fees for processing Industrial Revenue Bonds.
Isotechnologies was incorporated in 1982 and functioned solely as a
research and development corporation until approximately 15 months ago when
its first product was sold. During the past calendar year, its sales have
begun to increase on a fairly regular basis. The company has moved quarter by
quarter in a steadily improving profit position. During the last quarter of
calendar 1985 the corporation showed its first overall profit for any quarter.
As the sales have increased and our need for additional employees has
increased correspondingly, this company has found itself literally bursting at
its seams in its current facility, which is leased. We are in dire need of a
nicer facility for the presentation of our products which are sold primarily
to physicians, physical therapists and hospitals. If we expect to continue to
have successful sales growth in this market, we can not reasonably expect to
continue exhibiting our equipment in our current facility in a room in which
ji the roof leaks, we have inadequate electrical outlets and we have open holes
around the exterior door to our showroom as well as other entrances to the
current facility. As a start up company, we have been able to successfully
"talk our way through" our initial group of customers, i.e. , as a young
company we can not afford a nice facility until we get established and have
some track record that would support an investment or loan by other people.
Our corporate attitude toward the ualit of our from a
functional as well as a cosmetic standpoint, is that dittisbanhexexpensive line
of equipment being sold in a premium market. A comparison that we often make
is that when a physician approves p Y the purchase of one of our machines it is
approximately equivalent to buying a new Jaguar or Mercedes automobile and
0 they expect very high quality, not only from a functional standpoint but also
in appearance. Therefore, if we are going to sell to this general calibre of
clientele, we believe that we must have a facility that is conducive to
supporting the sales environment to which these people are normally
accustomed. We feel very fortunate that we have been able to sell to some of
the more prestigious hospitals for spinal and back injuries in this country,
including the Mayo Clinic. To enhance sales opportunities with similar
hospitals and clinics, we need an attractive facility that will reflect
stability and quality.
•
r,.1
.
Schedule for the Project
Closing Date for Real Estate Acquisition February uiii 26, 1986
Ground Breaking March 3, 1986
Occupancy Estimated late June, 1986
Disbursements To occur approximately monthly
during the period March thru
; , July, 1986
Cost Breakdown of Major Components
'1
Land $ 253,075
`'' Plant and Parking Lot (maximum)
Equipment & Tools 950,000
Furniture 70,000
Fees (maximum) 58,000
32,000
$1,363,075
•
,i
,�f
h
1
1
L::=zmcz==2..",,....._— .
Exhibit A
MEMORANDUM OF AGREEMENT
This MEMORANDUM OF AGREEMENT is _-_by. and between The Orange
,.. County Industrial Facilities and Po-llution Control Financing
Authority, a political subdivision and body corporate and politic
of the State of North Carolina the
__. { "Authority") , and
Isotechnologies, Inc. , a North Carolina corporation (the
"Company") .
1. Preliminary Statement. Among the matters of mutual
inducement and reliance which have resulted in the execution of
this Memorandum of Agreement are the following:
(a) The Authority is a political subdivision and body
corporate and politic of the State of North Carolina duly
created pursuant to the
provisions of Article V, Section 9
of the Constitution of North Carolina and Chapter 159C of
the General Statutes of .North Carolina, as amended (the
"Act") , and is a political subdivision of a state within the
meaning of Section 103(a) (1) of the Internal Revenue Code of
1954, as amended (the
"Code") , :_or., a constituted authority
hori
ty
authorized to issue obligations for and on behalf of such a
political subdivision, all within the meaning of the
applicable regulations under the `Code.
a -=
(b) The Company proposes the acquisition of a tract of
land of approximately 20 acres located east of Hillsborough,
North Carolina on State Road 1879-,-or Elizabeth Brady Road
near the intersection of State Road 1879 and U.S. 70, the
construction thereon of an approximately 30,000 square foot
building and the acquisition and installation therein of
machinery and equipment (herein called collectively the
"Industrial Project" ) .
• (c) The Company expects that the Industrial Project
will cost approximately $1,250,000, inclusive of interest
during the period of construction, underwriting discount or
commissions, if any, and legal, accounting, financing and
printing expenses.
(d) The Company has determined that the Industrial
Project will create employment for approximately 12 persons
and preserve 20 jobs for persons in Orange . County and the
. • surrounding area.
(e) The Company expects to pay an average weekly
manufacturing wage in excess of the average weekly manu-
facturing wage paid in Orange County.
(f) The Company has requested the Authority to enter
into this Memorandum of Agreement for the purpose of
declaring the Authority's intention to provide financing to
pay all or a portion of the cost of the Industrial Project.
(g) The Company has represented that neither it nor
any affiliate has financed the Industrial Project, that
neither acquisition, construction nor installation ( "Acqui-
sition" ) of the Industrial Project has yet commenced and
2.
I "
that it is essential that the Company let contracts in
connection with the Acquisition of the Industrial Project
shortly.
(h) This Memorandum of Agreement is entered into to
r` I induce the Company to proceed with the necessary plans for
the Industrial Project and to incur costs in connection with
various phases of the Industrial Project and to assure the
Company,p y, prior to the issuance of industrial development
revenue bonds of the Authority, that the Authority intends,
in accordance with and subject to the provisions of the Act,
to issue industrial development revenue bonds to cover costs
so incurred by the Company in connection with the Industrial
Project, including such costs incurred by the Company prior
to the issuance of the industrial development revenue bonds.
(i) The Company proposes that the Authority agree to
issue its industrial development revenue bonds under the Act
in an aggregate principal amount sufficient to pay all or a
portion of the cost of the Industrial Project, such
industrial development revenue bonds to be secured by the
an to
obligation of the Company Y pay the debt service thereon
and by virtue of the provisions of Section l03(b) (6) (A) or
; (D) of the Code, as now existing or hereafter amended, to be
exempt from Federal income taxation.
( j ) The Authority has determined, based upon represen-
tations made by the Company and.-_ without any independent
3. __ ._
investigation having been made by the Authority, that the
Acquisition of the Industrial Project by the Company and the
financing of all or a portion of the cost of the Industrial
Project by the Authority will be in furtherance of the
purposes of the Act in that it will induce the Company to
locate an industrial facility in North Carolina and will
thereby aid in alleviating unemployment and raise the
average weekly manufacturing wage in Orange County inasmuch
as the Industrial Project will provide new job opportunities
and preserve jobs and pay an average weekly manufacturing
wage in excess of the average weekly manufacturing wage paid
in Orange County.
2. Undertakings on the Part of the Authority. In
accordance with and subject to the limitations of the Act, the
Authority agrees as follows:
.(a) It will authorize the issuance and sale of one or
more issues of its industrial .development revenue bonds,
pursuant to the terms of the Act as then in force, in an
aggregate principal amount not exceeding $1,250,000 for the
purpose of paying all or a portion of the cost of the
Industrial Project.
(b) It will, at the proper time, and subject in all
respects to the prior advice, consent and approval of the
Company, submit applications, adopt such
proceedings and
authorize the execution of such documents as may be
I� •
4.
0
necessary and advisable for the authorization, sale and
issuance of the industrial development revenue bonds and the
Acquisition of the Industrial Project, all as shall be
authorized by the Act and mutually satisfactory to the
Authority and the Company. The industrial development
revenue bonds shall not be deemed-Ito constitute a debt or a
pledge of the faith and credit_ of the State of North
Carolina or any political subdivision or agency thereof, but
such industrial development revenue bonds shall be payable
solely from the payments to be provided (directly or
indirectly) by the Company. The industrial development
revenue bonds issued shall be in such aggregate principal
amount, shall bear interest at such rate or rates, shall be
payable at such times and places, shall be in such forms and
denominations, shall be sold in such manner and at such time
or times, shall have such provisions for redemption, shall
be executed, and shall be secured as hereafter may be
requested by the Company and fixed by the Authority, all on
terms mutually satisfactory to--E the Authority and the
Company.
3 . Undertakings on the Part of the Company. Subject to the
conditions hereinabove and hereinafter stated, the Company agrees
as follows:
5. _
(a) It will arrange for, manage and carry out the
Acquisition of the Industrial Project for and on behalf of
the Authority.
(b) It will make arrangements for the sale of the
industrial development revenue bonds and cooperate with the
Authority in making arrangements for the issuance of the
industrial development revenue bonds in an aggregate
principal amount not exceeding $1,250,000 and to the extent
that the proceeds derived from the sale of the industrial
development revenue bonds are not sufficient to complete the
Industrial Project, the Company will supply all additional
funds which are necessary for the completion of the
Industrial Project.
(c) Contemporaneously with the delivery of the
industrial development revenue bonds the Company will enter
into a financing agreement and such related agreements as
shall be necessary or appropriate so that the Company will
be obligated to pay for the account of the Authority sums
sufficient in the aggregate to pay the principal of and
interest and redemption premium, if any, on the industrial
development revenue bonds when and as the same shall become
due and payable.
(d) It will take such further action and adopt such
proceedings as may be required to implement its undertakings
hereunder.
6.
4. General Provisions_
(a) Since it is anticipated that the Acquisition of
the Industrial Project will commerice prior to the sale of
the industrial development revenue bonds and the Company
knows and acknowledges that the Authority will have no funds
available to meet the costs of the_. Industrial Project other
than those derived from the sale of the industrial
development revenue bonds, the Company agrees that it will
advance from time to time all funds necessary for the
Acquisition of the Industrial Project, and such funds when
so advanced shall be deemed funds advanced on behalf of the
Authority; provided, however, that the Authority shall not
by virtue of such advances or otherwise through this
Memorandum of Agreement acquire .any property interest in the
Industrial Project whatsoever. To the extent that the net
proceeds derived from the sale of the industrial development
revenue bonds are sufficient for• such purpose, the Authority
agrees to repay from such net proceeds to the Company all
; s funds so advanced promptly after the sale of the industrial
:.s
development revenue bonds.
? (b) The Authority and- the Company agree that the
V
Company shall provide all services incident to the
Acquisition of the Industrial Project, including, without
9:. limitation, the preparation of __plans, specifications and
contract documents, the award of contracts, the inspection
I
1 7. -
de
and supervision of work performed, the employment of
engineers, architects, builders and other contractors, and
the provision of moneys to pay the cost thereof pending
reimbursement by the Authority from such bond proceeds, and
the Authority shall have no responsibility for any provision
of any such services.
(c) All commitments of the Authority and of the
Company p y pursuant to this Memorandum of Agreement are subject
to the condition that on or before 365 days from the date
hereof (or such later date as- shall be mutually satisfactory
to the Authority and the Company) , the Authority and the
Company shall have. agreed to mutually acceptable terms for
the industria5. development revenue bonds and the sale. and
delivery thereof and mutually acceptable terms and
conditions for the agreements referred to in Section 3(c)
and the proceedings referred to in Sections 2 and 3 hereof.
(d) Notwithstanding any other provision hereof, the
terms of this Memorandum of Agreement shall be deemed to
have been extended for successive 365 day periods following
the expiration of the terms set forth in the foregoing
paragraph (c) unless and until either party hereto notifies
the other in writing of its election to terminate the
Memorandum of Agreement not less than
an 30 days prior to the
expiration of the current 365 day period. if the events set
forth in paragraph (c) of this Section do not take place
A
8.
•
••
within the time set forth or any extension thereof, the
Company agrees that it will reimburse the Authority for all
reasonable out-of-pocket expenses, arising from the
execution of this Memorandum of Agreement and the
performance by the Authority of its obligations hereunder.
(e) So long as this Memorandum of Agreement is in
effect, all risk of loss to the Industrial Project will be
borne by the Company.
(f) The Company hereby releases the Authority from,
agrees that the Authority and each Commissioner, officer and
employee thereof shall not be liable for, and agrees to
indemnify and hold harmless the Authority and each
Commissioner, officer and employee thereof from, any
liabilities, obligations, claims, damages, litigation, costs
and expenses (including attorneys' fees and expenses)
imposed on, incurred by or asserted against the Authority or
any Commissioner, officer or employee thereof for any reason
whatsoever pertaining to the -:Industrial Project, the
industrial development revenue bonds or this Memorandum of
Agreement or any transaction contemplated by this Memorandum
of Agreement.
(g) As a matter of general assurance by the Company to
the Authority, the Company hereby covenants and agrees that
it will indemnify the Authority for-_all reasonable expenses,
costs and obligations incurred by-. the Authority under the
9.
provisions of this Memorandum of Agreement to the end that
the Authority will not suffer any out-of-pocket losses as a
result of the carrying out of any of its undertakings herein
contained. It is furthermore expressly agreed that any
pecuniary liability or obligation of the Authority hereunder
shall be limited solely to the payments received by the
Authority from the Company and to moneys derived from any
financing relating to the Industrial Project, and nothing
contained in this Memorandum of Agreement shall ever be
construed to constitute a personal or pecuniary liability or
charge against any Commissioner or any officer or employee
of the Authority, and in the event of a breach of any
undertaking on the part of the Authority contained in this
Memorandum of Agreement, no personal or pecuniary liability
or charge payable directly or indirectly from the general
funds of the Authority shall arise therefrom.
(h) In any event, the provisions of this Memorandum of
l.�
Agreement shall be superseded by the agreements entered into
1
4�.
CCr
I '
10 .
1
g.�
by the Authority and the Company in accordance with Section
3(c) of this Agreement.
IN WITNESS WHEREOF, the parties hereto have entered into
this Memorandum of Agreement by their officers thereunto duly
authorized as of the 6th day of December, 1985.
THE ORANGE COUNTY INDUSTRIAL •
FACILITIES AND POLLUTION CONTROL
FINANCING AUTHORITY
i C r
(Seal)
Chairman
At e t:
v
Secretarlt
ISOTECHNOLOGIES, INC.
By
Title: 1/, �
11.
r
SUPPLEMENTAL MEMORANDUM OF AGREEMENT
This SUPPLEMENTAL MEMORANDUM OF AGREEMENT is by and between
The Orange County Industrial Facilities and Pollution Control
Financing Authority, a political subdivision and body corporate
and politic of the State of North Carolina (the "Authority" ) , and
Isotechnologies, Inc. a North Carolina corporation ( the
iR
"Company") .
WITNESSETH:
WHEREAS, the Authority and the Company p y have previously
entered into a Memorandum of Agreement, dated December 6, 1985
(the "Original Memorandum of Agreement") , to finance an Industrial
Project (as defined in the Original Memorandum of Agreement) and
issue approximately $1,250,000 industrial development revenue
bonds therefor; and
WHEREAS, the Company has requested that certain amendments be
1 made to the Original Memorandum of Agreement;
NOW, THEREFORE, in_ consideration of the respective repre-
sentations and agreements contained in the Original Memorandum of
Agreement, the parties hereto agree that the following Sections be
amended to read as follows:
fi
Section 1
" (c) The Company expects that the Industrial
Project will cost approximately $1, 500,000, inclusive of
interest during the period of construction, underwriting
;
i`
J. discount or commissions, if any, and legal, accounting,
financing and printing expenses .
" (d) The Company has determined that the Industrial
Project will create employment for approximately sixteen (16)
persons and preserve 20 jobs for persons in Orange County and
the surrounding area. " - --
Section 2
" (a) It will authorize the issuance and sale of one or
{ more issues of its industrial development revenue bonds,
pursuant to the terms of the Act as then in force, in an
aggregate principal amount not exceeding $1,500, 000 for the
purpose of paying all or a portion of the cost of the Indus-
trial Project. "
Section 3
"(b) It will make arrangements for the sale of the
industrial development revenue bonds and Cooperate with the
Authority in making arrangements for the issuance of the
industrial development revenue bonds in an aggregate prin-
cipal amount not exceeding $1, 500,000 and to the extent that
the proceeds derived from the sale of the industrial
development revenue bonds are not sufficient to complete the
Industrial Project, the Company will supply all additional
funds which are necessary for the completion of the Indus-
trial Project. " _=.
i
L.
2.
..�.._...,. . . -
r
jf I
• EXCEPT AS AMENDED HEREBY, THE ORIGINAL MEMORANDUM OF
AGREEMENT SHALL REMAIN IN FULL FORCE AND EFFECT.
IN WITNESS WHEREOF, the parties hereto have entered into
this Supplemental Memorandum of Agreement as of the 25th day of
February, 1986.
THE ORANGE COUNTY INDUSTRIAL
FACILITIES AND POLLUTION CONTROL
FINANCING AUTHORITY
lBy
Chairman
(Seal)
Attest:
Secketary
;.'.; ISOTECHNOLOGIES, INC.
Hy<=%1Z,1001.- C2S;.‘0:Le=---
TI
Title: V/,'
3.
,
.' EMPLOYMENT PROFILE
(A proposed new manufacturin g facili ty or an expansion of an existing plant)
NUM9EA OF EMPLOYEES
j Current Year End of First WAGS
for Existing Year
Year End of Third Year Current Year First Year
i j Industry•" Third Year
Date: Date:
Date: From 7 1 $5 Date
Date: Date: -u� From 7 85 From:?/
7/30/85 6/30/86 /8g To___6130/16 To 6 30/86 To��
3 3 3 Professional
i,l 1 — T—Management
.1 1 0 Engineers
1
. - �Accounting
• 2 2 Quality Control
i{ Research & Dev. 385,877
486,985
! 3 Chemist. etc.
4 5 Marketing
I 1 2
k Support (561.17 man-
2 5 8 wks)
i 1 l — _Clerical ________ ..._________
a 1 ---f---1 Transportation
0 1 � Maintenance
1 - �Programmers 87 576 223 0 06 1
II 0 1 En- r• Tech
��— Machinist
2 8. man-
Prod�(By Skill Classification)Wks)
t 1 2 _ Electrician
I 2~— dra„lics j66,538 l ht
d
i 20 2g 36 (1029,6 man-
wks)
Total Total Total
TOTAL EMPLOYMENT'
Annual Payroll 539,991 859,080
Weighted hourly wage average
Weighted weekly wage average 524.45 ��
'Of this number, 45$.91
will be moved into the community and will be employed from the community.
"Employment Security Commission Account Number 93-68-337-3
The purpose of this profile is to serve as a guideline for determining the employment information needed to assess
economic impact and to provide the data on which the project average manufacturing wage can be derived.While a
Prospective applicant may alter the employment profile form to fit his individual situation,the applicant must provide
the same information as to wages and number of employees as requested in the employment profile The profile shall
be certified by a corporate officer and may include a disclaimer such as the following:
"The above data is based on current plans of our company and represents the best planning available to us.
Economic conditions or changes in the technology within our industry may cause changes.The projections
are made on the basis of the best available information and they do demonstrate our intentions.”
Date �'mE.. ?Y�?_ ■
• Signature
'title
EXHIBIT D
ENVIRONMENTAL IMPACT
•
The Division of Environmental Management for the State of North Carolina
has reviewed Isotechnologies plans and examined the nature of operations.
They ruled that there are no special requirements for this facility.
EXHIBIT E
SECONDARY ECONOMIC IMPACT
It is the intention of Isotechnologies to purchase, on a competitive
basis, all items and services which are available in Hillsborough and the
surrounding communities. The quality, reliability of service, and price will
be major factors in the judgment as to who gets the business.
Some of the sub-assembly work which is currently being done outside our
plant will continue to be provided by small businesses in the general area
near the Hillsborough site. There is no commitment at this point in time to
divert current business from existing vendors to vendors in the immediate
Hillsborough area, but certainly in Orange, Alamance, Wake, and Durham
counties we do expect to continue using small businesses as vendors on a
sub-assembly basis for many of our needs.
The nature of the products which are manufactured and sold by
Isotechnologies does not lend them to a market of any substantial size in the
immediate Hillsborough area. However, the medical communities which exist in
the Durham and Chapel Hill area in particular, as well as Raleigh, do offer
some opportunities for sales and the clinical evaluation of products which are
anticipated by this company. The population growth in the Research Triangle
area in general supports the growth of physical therapy clinics and
opportunities for sales in those clinics due to the nature of our products.
EXHIBIT F
AVAILABILITY OF UTILITIES
The town of Hillsborough already has water and sewer service available
along the road that is adjacent to our property. Public Service company of
N.C. has a gas line that is along the side of the road which is adjacent to
our property and Duke Power Company has power sitting on the right of way
adjacent to our property right now. Thus all of the utilities are immediately
available upon payment of appropriate fees.
Since no extensions will be required for any of these services, no
community financing will be required.
•
Mayor autitfitllstiu
aerk
Frank H. Sheffield,Jr. Town Johnson
' HILLSBOROUGH, NORTH CAROLINA 27278
W''. Commissioners
Agatha Johnson
Supt, Water Works
° Myron L. Martin James Pendergraph
.. .Horace H.Johnson - Street Supt.
Allen A.Lloyd ,wt}'r'Yr1r L.D.Wagoner
Remus J.Smith fir+ r r
Rachel H. Stevens .:r r.` , % Arnold W Hamlett
' W I Fire Chief
_. .a + r\� John Forrest
April 7, 1986
I
' Orange County Industrial Revenue Authority -'
•:..This is to state that the To of Hillsborough will provide water
"" "`zend sewer utilities to isotechnolo ies Inc. `located on Elizabeth
�e,:.,:, ',..,:, ...!Brady 8
� �� °�i Roads Hillsborough, N. C. ;�.'a � � `t'7`,,�
Should additiottal required, `
information } z
' . �'!q' ,,dd be "tease advise. ' `
ti i .fir♦` ' P •fi r. ' Sri' _,_, .4. F-rV .7.. ... � 7FrJ ^::n
\' , ba W��, T / .. -
■-'�, NreS*b" 'Y+ o •X• # `4awn Clerk
ry"-f�"A.' F��
.:•ssr.`._<c:;4"...iwrl.uei.-0Fyri.. ,n• - •.a u rY. � �!'Ai`.Dc••,,� s.'� 'i, f.; j�
•.w
DUKE POWER COMPANY v .
P.o. sox 54o OLD 65 SOUTH AT ORANGE GROVE ROAD - TEL4rHONE:
I. HILLSBOROUGH, N.C.67276 .. I3i-2115
•
April 7p 1986
To: Orange County Industrial Revenue Bond Authority
Subject: Isotechnologies, Brady Road Construction,
Hillsborough, North Carolina
Dear Sire:
Duke Power Company will deliver electrical service to
the above referenced project as requested by Mr. Tom
Coleman with Isotechnologies.
/'
S eve ruise,
anager ' F•.. ... •• , .
- TX4.7.l.7b^-,,,,li'1.' Br.anch .-',
EXHIBIT G
NARRATIVE ON THE ECONOMIC CHARATERISTICS OF THE COMMUNITY
Hillsborough is the County Seat of Orange County, North Carolina. The
population of Hillsborough is around 3100, within the city limits. Within 5
miles of the town there are estimated to be another 3000+ residents. The
manufacturing sector in Hillsborough employs approximately 800 people, which
is down from 1350 people at the end of 1983. The reduction of more than
one-third was due to the closure of The Cone Mills Eno Plant in early 1984,
which resulted in the loss of 550 jobs. One major relocation took place
in 1985, with the opening of a new facility by Parker Hannifin Corporation,
which employs 50 people. In late 1985 and early 1986 employment has been
growing slowly as small companies locate in the Hillsborough Business
Center (formerly the Cone Mills Eno plant). The largest industrial employer
now is Hillsborough Textiles, a traditional industry. Other companies locally
are in metal working, furniture, printing. Two companies could be said to
offer "high-tech"" or "new tech" jobs: Wilmore Electronics and Tecan, Inc.
Isotechnologies, Inc. will therefore bring new jobs to a town which
has not yet fully recovered from the severe job loss of two years ago, and
will help to diversify the employment base, bringing "high-tech" jobs to a
base which is heavily concentrated in the older, traditional industries.
Furthermore, Hillsborough and Orange County are very sensitive to preserving
the environment, and Isotechnologies, Inc. is the type of clean, non-polluting
industry which the Economic Development Commission is most interested in
encouraging.
•
,The attached map shows the location of the Isotechnologies, Inc. site,
at the center of circles representing a one-mile radius and a three-mile
radius. The site is approximately two miles from the center of Hillsborough.
The portions of the one-to-three mile area which are not shown on the map are
rural residential, low density development, with some commercial, but no
industrial development.
The Isotechnologies site is located in an area which comprises part of
the extra-territorial jurisdiction of Hillsborough, being outside the city
limits, but zoned by the Town. The site is in the midst of an industrially
zoned area, and there is no adjacent residential area. The nearest houses are
approximately 3/4 mile away to the north across the Eno River, and to the
south along US 70 Business.
Within the one-mile circle are located W. H. Brady Co. (#1), Parker-
Hannifin Corporation (#2), Wilmore Electronics (#3), Hines Liner (#4), the FCX
livestock market (#6), and White Furniture (#7), while just beyond the
one-mile radius is U.S. Plywood (#5) and commercial areas at the interchange
of I-85 and NC 86. Nearby is a new business park called Meadowlands (#8);
currently there are no tenants in this park.
The remainder of the three-mile area is local commercial, residential,
and the main shopping areas of the Town of Hillsborough. Beyond the three
mile area to the north of town is Major Business Forms, and to the west is
Hillsborough Business Center (#9) referred to above.
�•.p r„_____
_ _ ,,t___. i . II N.,)
i _ i ...1 :, . • _
; 0.
- .cr, Q,„ d
„....,.._ ....,, ....._,,....iir , ....... ,- 4.„ , \
J' . CIS f
____ ____. \ _ ._.... c.,... ,,„ ,-.
4'/ tom _ \ � — �_ 2W
■ b s Et xv....
��; \ .� ,-
Q�ts f S► ., ~ m q.' ` � "• \
na . 7.A3 A• ''” ems;: ti
( O' ........... yam, 1 guy, �nni �:`..'� �q
3 I �• ,', �,d_ / c? ice' 't..J.■*r '
0 Illr .. f je._ ,�I di. ,..,1py. bey 4---./ ; �1• , *! `�1
ON, • 116.4' 0,- • 11....00.01111
rrw Fwd
Alf,
-4.x' 4 *I
Ai .4101 g.
• • 1 / r V� 0.
t ;W
OffK' ji fii Il ° _:j.�t :.'1 t4'J -r • 1 \•�,Pc*
a Al_
s a
k twill f . .4.44/...41 tia ..:':. .-1 '. hsith Q. �ir►q 7�p 'i I
�dit r . w-- '5 '....c am- I RNER FA
��'e 6y� \ ..v....,.-,,:7__ ,ii,.�"'+ Sao ! 4 4/ -� 1130 ; '
li....■4•... r . - ....., ,,, -71111Alarriiiir."11.0 44.4. 1111.0010-0"\,... kw,. L.i.--,riiiii . ____
_ .\, _ ..:.__ , .5_ iiihiiii_. —.."..i.„__ ........ „,..
e SnOWwO j
1 -ter'— ----,
.•R10er., v o '� C!i Sa�3�31i0Cw 1 \
1
11 - --- r j /
a►�a6►urx im. �° i y ( Li, �r 0 kil
y � ( I I
NMI�' �- pro •CI w_u t 3 �.. v♦I / 1 L.
.` j I, ` ! „----k/ ( .0.,
, EXHIBIT H
ABANDONMENT STATEMENT
y' As indicated in Exhibit A, the facility we currently occupy is in such a
' poor state of repair that its very condition dictates a move.
In late December, 1985, our landlord notified us that he is closing a
facility in the north-central part of the country and intends to move that
operation into the building we occupy. When our lease expires June 30, 1986,
,` it will not be renewed.
Therefore, Isotechnologies will abandon its current facility, but that
facility will immediately be re-occupied by the owner.
Isotechnologies will not abandon any other facilities.
Ilr'
41111111111....der -ct.-.
Vice
President,
Operations
Isotechnologies, Inc.
Exhibit I
Narrative.
The Company is managed by two men; Mr. James B. Martin, Jr. ,
General Manager and Vice-President; and Mr. Thomas Coleman,
Vice-president . Their business and management experience is set
out in resumes below.
Controlling interest in the corporation is owned by Mr. Jerome
J. Richardson, Chairman of the Board of Directors . Mr. Richardson
is an active participant in the business of the corporation
providing business guidance and financial support. Management
works closely with Mr. Richardson to execute the policies adopted
by the Board of Directors .
Isotechnologies, Inc. does have one wholly owned subsidiary,
Richardson Development Corporation. Richardson Development
Corporation is a research and development company which has
provided financial assistance to Isotechnologies in the
development of its products. Richardson Development Corporation
is not active at this time and does not have any ongoing business
relationship with Isotechnologies, Inc.
Neither the company, its affiliates nor management of the
company has ever been involved in bankruptcy, creditor's rights,
receivership proceedings, or criminal proceeding- bearing on the
handling of financial matters.
1060A
k
Isotechnologies, Inc.
BOARD OF DIRECTORS
Jerome J. Richardson
A Chairman of the Board, Isotechnologies, Inc.
Chairman of the Board, Spartan Food Systems, Inc.
Director of Transworld Corporation
Roy J. Bostock
President, Benton & Bowles Advertising, New York City
N. Clark Hatcher, Jr.
Vice President, Drexel Furniture Company
James B. Martin
Vice President and General Manager, Isotechnologies, Inc.
Samuel H. Maw, Jr.
Executive Vice President, Spartan Food Systems, Inc.
Dr. Glenn L. Scott
Orthopaedic Surgeon
*******************************************************************************
Herbert Tullis, C.P.A., Financial Consultant
Retired Vice President, Champion Papers International
Mr. Tullis is not a member of the Board, but does provide financial consulting
services to the company on a routine basis.
ri
Isotechnologies, Inc.
KEY MANAGEMENT PERSONNEL
The following summary indicates the education and experience of the key
management personnel active in the company as of June, 1985.
James B. "Whitey" Martin, Vice President of Marketing and General Manager
B.S. , Animal Science, North Carolina State University, 1965.
Mr, Martin has been with Isotechnologies, Inc. since June, 1984.
Prior experience includes:
General Sales Manager, Occidental Chemical Company
Director of Sales, Winchester Arms Group, Olin Corp.
General Sales Manager, Agricultural Chemicals Division, Olin Corp.
National Feed Ingredients Association
Member, Board of Directors
{ Executive Committee
First Vice President
I'
Dr. Donald R. McIntyre, Vice President of Research and Development
Ph.D., Biomechanics, University of Oregon,on 1 979.
M.A. , Kinesiology, University of Iowa, 1976.
Teachers Diploma, with Distinction, Auckland Seconds
Teachers College, Auckland, New Zealand, 1969. ry
Diploma, P.E. , University of Otago, Dunedin, New Zealand, 1969.
Dr. McIntyre has been with Isotechnologies since 1983.
Prior experience includes:
Consultant for:
Dresser Industries, (mining), Dallas, Texas
Texas Rangers Baseball Club, Arlington, Texas
3D Orthopaedics, Dallas, Texas
North Texas State University, Assistant Professor
University of Iowa, Associate Course Chairman
Taught in
g one
college and two high schools in New Zealand
Professional Organizations:
American Society of Biomechanics
International Society of Biomechanics
Dr. McIntyre has published approximately fifteen times, both
domestically and internationally, in publications such as Journal of
Biomechanics, Human Movement Science, Journal of Human Movement
Studies, Research Quarterly, and the Conference of the American
Society of Biomechanics.
I
I±I
{ Thomas C. Coleman, Vice President of Operations
i
M.B.A. , Darden Graduate School of Business Administration,
University of Virginia, 1962.
i B.S. , Ceramic Engineering, North Carolina State University,
1960.
Mr. Coleman has been with Isotechnologies since 1985.
1 Prior experience includes:
Ci
Abbott Laboratories, fifteen years
Production Management
Materials Management
Quality Assurance
Corning Glass Works
li Two small manufacturin companies
1
Joel V. Johnston, Director of Software Development
B.S. , Chemistry, University of North Carolina at Chapel Hill,
1982.
Biomedical Engineering, University of North Carolina at Chapel
■ Bill; completed course work for Ph.D. 1984.
I' Prior experience includes:
General Electric Microelectronics Center, Research Triangle
Park, N.C.
Dental Research Center, University of North Carolina at
Chapel Hill, Research Associate
I
I
I
q,1 +w
r;:
ISOTECENCLOGIFS, INC. AND SUBSIDIARY
4` BALANCE SE
DECEMBER 31, 1985
INCREASE
ASSETS
DECEMBER 31, 1985 JUNE 30, 1985 (DECREASE)
Current Assets:
Cash $509,946 $ 94,684 $415,262
Accounts Receivable 152,766 87,546 65,220
Inventories 100,831 124,011 (23,180)
Prepayments 6,083 7,183
(1,100)
Deposits
750 750 -0-
Total current assets $770,376 $314,174 $456,202
1 Plant, 'Property and Equipment -
(net)
222,684 24. 2,727 (20,043)
Total assets $993,060 $556,901 $436,159
LIABILITIES
Current Liabilities:
Notes Payable $ -0- $436,000 $(436,000)
' Current Maturities of
• Lang-Term Debt 40,161 40,181 s (20)
Accounts Payable 64,796 68,462
Customers' Advances (3,666)
104,835 41,250 63,585
Accrued Expenses:
Legal & Accounting 8,100 12,512 (4,412)
Warranty 30,411 41,500 (11,089)
Revenue Sharing 39,000 25,274 13,726
Commissions 61,023 17,409 43,614
Payroll, Payroll Taxes
and Other 80,281 55,589 24,692
Total current liabilities $428,607 $738,177 $(309,570)
•
•
•
•
ISGTECS CLOGIES, INC. AND SUBSIDIARY PAM 2
SAIM= SMET
DECEMBER 31, 1985
LIABILITIES CCN'T, DECEMBER 31, 1985
INCREASE
JUNE 3Q
1985 (DEG9FjASE,)
Long Term Debt, less
current maturities $ 151,109
$ '174,717 $ (23,608)
Stockholders' Equity:
won Stock $ 20,589
Paid-2n Capital 2,204,222 $ 5 ,221 21 $ 8,009
1,45621 090
,4566
Accumulated Deficit (1,535.226) ,2 748,001
(1.555,063) 19,837
Less- Treasury 6$9.585 (79,757) 769,337
Shares
276,241 276,241 -0_
$ 413,344 $ (355,993) $ 769,337
Total liabilities
and stockholders'
equity
$ 993.060 $ 556,901 - $ 436,159
CTE: This statement was prepared from the books and records of the C
without independent audit.
y
•
-
ISOTECLOGZES, INC.
PROFIT AND LOSS
SIX MCNTES ENEED DECEMBER 31, 1985
FAVORABLE
(UNFAVCRABLS)
ACTUAL PLAN VARIANCE
Gross Sales $1,221,780 $1,175,355
$ 46,425
Cost of Goods Sold 336,347
329,144 (7,203)
Grass Margin $885,433
$846,211 $ 39,222
Grass Margin $ 72.5%
72.0$ 0.5%
General and Administrative
Expense $384,529 $328,430
• $(50,099)
Sales and Marketing Expense 353,560
391,730 38,170
Research and Development
Expense
.A.22,039
150,448 28,409
Total Expense $860,129 . $870,608 $ 10,480
Orating Profit (Loss) $ 25,305 $(24,397) $ 49,702 -
Interest Expense 5,468
8,183 2,715
•
Net (Loss) Before - —�
Federal Inccme Tax $ 19,837
$(32,580) $ 52,417
MJTE: This statement was prepared from the books and records of th
Company without independent audit. e
•
.- T
AL‘j: /
6-30-g7. -� I 34-88 -
/;14-.Scys
.Td SO
cEC. 29 ¢.S! . 33
—___. _I �L_ -1 io AO
-- -- _ ¢ __ _ 661 __76a _ 93S_ _/763
I -..a3O /t1.36
-_� Ta�•rL �ssE1s; 69S /73/ /&9a
7965 2793
LJA$/LTJ ..S -. 1 ;
-_Cry-e e._FZr a— -_I18 /38_
I 1 --!9rt-. _263
1
. ,e7,,,, e Ace-er- .We 1
, :: _---(49- ,:".4_,?_&-._., fki ..__________:.__I ..____.___. ..i _____._____, _____L_ ._______ _ __ _____
_ _ 3& -1 _I ,t68 ___7
�^es%E�.a12�- - - _ _ - -
_ G, -11.... CGr.22 82 - -
- _/ - I - -S 2 ------ - - • -
�ey�,z F�e. 219 589 -- --
I /252 _ 2/86 _
To r�L Lste. -I 6 9S /73/ /890 -- -_ -
i.trocX�+o r --- /96S 2- - --
.
I
-- 1 �._ -� - - - } -
THE ORANGE COUNTY INDUSTRIAL FACILITIES
AND POLLUTION CONTROL FINANCING AUTHORITY
Extract of minutes of a meeting on a resolution author-
; ; izing the execution of a Memorandum of Agreement by and
between The Orange County Industrial Facilities and Pollu-
tion Control Financing Authority and Isotechnologies, Inc.
relating to the financing of an industrial project in Oran
County, North Carolina and of
` exceeding $1,250, 000 aggregate authorizing the issuance of not
trial development revenue bands -bonds-of the Authority therefor.
efor.
The Orange County Industrial Facilities and Pollution Con-
trol Financing Authority met in the Municipal Building in Chapel
Hill, North Carolina at
$110.: __a_. M. on December 6, 1985.
';.''E::.' The following Commissioners were:==-
Present: Commissioners Thomas K,
Tiemann John S. Gastineau
Maur D. Klein Elaine Parker
Aasent: an Ber an � ��
Sand McClamroch John L. McKee
Also Present: Geoffre E G dhill County Attorney; lvia
Price ' Director of the Oran e Count Office of Economic
Develo•meat
* * *...
T Tiann Chair -
om em
announced that The
Orange County Industrial Facilities .and Pollution Control Financ-
ing Authority (the "Authority") had been requested by Isotech-
Y nologies, Inc_ (the "Company") to agree to provide financing for.
-
j:
the cost of acquisition of a tract of land of approximately 20
acres located east of Hillsborough, North Carolina, on State Road
1879 or Elizabeth Brady Road near the intersection of State Road
1879 and U.S. 70, the construction thereon of an approximately
30,000 square foot building and the acquisition and installation
therein of machinery and equipment (the "Industrial Project") ,
that bond counsel for the Authority had prepared and distributed
a Memorandum of Agreement, that counsel to the Authority had
d reviewed the Memorandum of Agreement, that the Company,F. had
requested that the Authority approve and execute the Memorandum
of Agreement, and that he believed that it was in order for the
Authority to approve the Memorandum of Agreement and authorize
its officers to execute the same.
Commissioner • then introduced the
following resolution, a copy of which was distributed to each
Commissioner and the title of which was read:
RESOLUTION AUTHORIZING EXECUTION OF A
AGREEMENT BY AND BETWEEN THE ORANGE COUNTY AL
FACILITIES AND POLLUTION CONTROL FINANCING AUTHORITY
AND ISOTECHNOLOGIES, INC. RELATING TO THE FINANCING OF TY
AN INDUSTRIAL PROJECT IN ORANGE COUNTY, NORTH CAROLI
;; AND AUTHORIZING THE ISSUANCE �'
$1,250,000 AGGREGATE PRINCIPAL AMOUNT NOT F
EXCEEDING
° DEVELOPMENT REVENUE BONDS OF THE AUTHORITY THER FOR. IAL
i
WHEREAS, The Orange County Industrial Facilities
Pollution Control Financing Authority and
y (the "Authority") desires
to authorize the execution of the Memorandum of Agreement; and
2.
`r
M .
WHEREAS, the Authority desires to approve the issuance of
not exceeding $1,250, 000 aggregate principal amount of industrial
development revenue bonds of the"-Authority to finance an
Industrial Project for Isotechnologies, Inc . (the "Company" ) ;
NOW, THEREFORE,
BE IT RESOLVED by the Authorit
y as follows:
(1) The Memorandum of Agreement relating to the e financin g
of an Industrial Project for the Company in Orange County, North
il Carolina is hereby approved in the form of that presented at this
meeting and attached hereto as Exhibit A, and the Chairman or the
Vice Chairman and the Secretary or the Assistant Secretary of the
Authority are hereby authorized toy execute and deliver five
counterparts of such Memorandum of Agreement for and
on behalf of
-the Authority.
(2 ) The Authority hereby agrees to issue, subject to the
terms and in accordance with the provisions of Chapter 159C of
the General Statutes of North Carolina, as amended, not exceeding
'`r
$1,250,000 aggregate principal amount of its industrial develop-
_
evelo -
merit revenue bonds to p
Pay all or a portion of the cost of the
Industrial Project, all as set forth in the Memorandum of Agree-
1..7
,, ment.
' (3) The Authority hereby appoints
the Board of Commis-
'. ,!
7 :
'] i
sioners for Orange County as its agent to apply for any
allocation with respect to Executive _b-rder 113 of the Governor of
the State of North Carolina,
i' 3. __
Or
a ' .
(4) This resolution shall take effect immediatel- upon its
passage.
Commissioner Gastineau moved the passage of the
foregoing resolution entitled "RESOLUTION AUTHORIZING EXECUTION
OF A MEMORANDUM OF AGREEMENT BY AND BETWEEN THE ORANGE COUNTY
INDUSTRIAL FACILITIES AND POLLUTION CONTROL FINANCING AUTHORITY
3
AND ISOTECHNOLOGIES, INC. RELATING TO THE FINANCING OF AN
INDUSTRIAL PROJECT IN ORANGE COUNTY, NORTH CAROLINA AND
AUTHORIZING THE ISSUANCE OF NOT EXCEEDING $1,250,000 AGGREGATE
PRINCIPAL AMOUNT OF INDUSTRIAL DEVELOPMENT REVENUE BONDS OF THE
AUTHORITY THEREFOR", and Commissioner Parker.
seconded the motion, and the resolution was passed by the
following vote:
Ayes: Commissioners Tiemann. Gastineau, Klein and Parker
, Noes: None
*
1 *
:).1.
y I, L Klein , Secretary of The Orange County
Industrial Facilities and Pollution Control Financing Authority and k y
eeper - of the official minutes thereof, DO HEREBY CERTIFY
that .the foregoing is a true copy of certain of the proceedings
:.; s g
of the Board of Commissioners of the Authority taken at a meeting
held at the time and
':� : place shown on the front page of these
excerpts of minutes and is a complete copy of so much of the
: 4.
iiiiNiir
recorded minutes of said meeting as relates in any way to the
passage of the resolution hereinabove set forth.
I DO HEREBY FURTHER CERTIFY, that, pursuant to Article II of
the By-laws of the Authority, I , by directing counsel of the
Authority to do so, gave all members of the Authority written
notice of said meeting not less than twenty-four hours prior to
`9
the time shown on the front page of these excerpts of minutes,
and that, at least forty-eight hours before said meeting, had
posted such notice on the principal bulletin board or at the door
of the usual meeting room of the Authority and had mailed or
delivered such notice to each newspaper , wire service , radio
station, television station and person that had filed with me a
written request for notice pursuant to G.S. 143-318.12.
WITNESS my hand and the official seal of The Orange County
• Industrial Facilities and Pollution Control Financing Authority
this 6th day of December, 1985.
CAL
Secretary -r
;tqz (SEAL)
5-
•
•
i
r
THE ORANGE COUNTY INDUSTRIAL FACILITIES
AND POLLUTION CONTROL FINANCING AUTHORITY
Extract of minutes of a meeting on a resolution author-
izing the execution of a Supplemental Memorandum of Agreement
by and between The Orange County Industrial Facilities and
Pollution Control Financing Authority and Isotechnologies,
Inc. relating to the financing of an Industrial Project in
Orange County, North Carolina.
The Orange County Industrial Facilities and Pollution Control
Financing Authority met in Central Recreation Center Activity Area
No. 1 in Hillsborough, North Carolina at 2:00 P.M. , on February
25, 1986.
The following Commissioners were
Present: Commissioners Thomas K. Tiemann; Elaine Parker, Sandy
McClamroch, John S. Gastineau and Maury D. Klein
-
Absent: Commissioners John L. McKee and Ed Bergman
•
Also Present: Geoffrey E. Gledhill, County Attorney; Sylvia _
Price, Director, Orange County Economic Development Office; Tom
Coleman and Whitney Martin, representing Isotechnologies, Inc. ;
and Randy Dickerson, NCNB, Carrboro.
* * *
Thomas K. Tiemann, Chairman, announced that The Orange County
Industrial Facilities and Pollution Control Financing Authority
(the "Authority") had been requested by Isotechnologies, Inc. , a
North Carolina corporation ( the "Company" ) to agree to revise the
Memorandum of Agreement, dated December 6, 1985
(the "Original •
Memorandum of Agreement" ) , by and between the Company and the
4
Authority to finance an Industrial Project
J (as defined in the
Original Memorandum of Agreement) and issue approximately
1.
$1,500, 000 industrial development revenue bonds therefor . The
parties have agreed to revise the _following Sections of the
Original Memorandum of Agreement to read--as follows :
Section 1 --:-
" (C) The Company expects that the Industrial Project
will cost approximately
y $1,500,000,_ inclusive of interest
during the period of construction, underwriting discount
or commissions, if any, and legal, accounting, financing
and printing expenses. "
"(d) The Company has determined that the Industrial
Project will create employment for approximately sixteen
(16) persons and reserve 20
p jobs for persons in Orange
County and the surrounding area. "-
Section 2
•
" (a) it will authorize the issuance and sale of one
or more issues of its industrial development revenue
bonds, pursuant to the terms of the Act as then in force,
in an aggregate
9 principal amount not exceeding $1, 500,000
for the purpose of paying all or-A2 portion of the cost of
the Industrial Project. "
Section 3
"(b) It will make arrangements for the sale of the
industrial development revenue bonds and cooperate with
the Authority in making arrangements for the issuance of
the industrial development revenue bonds in an aggregate
2. .. ..
•
principal amount not exceeding $1,500,000 and to the
extent that the proceeds derived from the sale of the
industrial development revenue bonds are not sufficient to
complete the Industrial Project, the Company will supply
all additional funds which are necessary for the comple-
tion of the Industrial Project . "
that bond counsel for the Authority had prepared and distributed a
Supplemental Memorandum of Agreement, that counsel to the Author-
ity had reviewed the Supplemental Memorandum of Agreement, that
the Company had requested that the Authority approve and execute
the Supplemental Memorandum of Agreement, and that he believed
that it was in order for the Authority to approve the Supplemental
Memorandum of Agreement and authorize its officers to execute the
same.
Commissioner Tiemann then introduced the fol-
lowing resolution, a copy of which was distributed to each Commis-
sioner and the title of which was read:
RESOLUTION AUTHORIZING EXECUTION OF A SUPPLEMENTAL
MEMORANDUM OF AGREEMENT BY AND BETWEEN THE ORANGE COUNTY
INDUSTRIAL FACILITIES AND POLLUTION CONTROL FINANCING
AUTHORITY AND ISOTECHNOLOGIES, INC. RELATING TO THE
FINANCING OF AN INDUSTRIAL PROJECT IN ORANGE COUNTY,
NORTH CAROLINA.
WHEREAS, The Orange County Industrial Facilities and Pol-
:.l lution Control Financing Authority ( the "Authority" ) desires to
authorize the execution of the Supplemental Memorandum of
3.
,I ,
Agreement by and among the Authority and Isotechno
North Carolina corporation ( the "C logies, Inc, , a
"Company") ; NOW, THEREFORE,
BE IT RESOLVED by the Authority a.s°ufollows:
it
1. The Supplemental Memorandum of Agreement relating
financing of an Industrial Project for the Company to the
County, North Carolina is hereby a p Y in Orange
ppr:bved in the form of that
4; presented at this meeting and attached hereto as
the Chairman _ Exhibit A, and
or the Vice -Chairman and the Secretary or the
Assistant Secretary of the Authority are hereby authorized
cute and deliver five counterparts of such Supplemental Memorandum
exe--
of Agreement for and on behalf of the Authority.
al Memorandum
2. The Authority h
Y ereby confirms its undertakings under the
Original Memorandum of Agreement as amended b
. Memorandum of Agreement . by the Supplemental
3 . This resolution shall take effect immediately upon its
passage. _- -
,y Commissioner
Gastineau moved the
passage of the
foregoing resolution entitled
"RESOLUTIDN AUTHORIZING EXECUTION OF
A SUPPLEMENTAL MEMORANDUM OF
AGREEMENTBY AND BETWEEN THE ORANGE
COUNTY INDUSTRIAL FACILITIES �~�
AND POLLUTION CONTROL FINANCING
AUTHORITY AND ISOTECHNOLOGIES, INC. RELATING TO
AN INDUSTRIAL PROJECT IN O THE FINANCING OF
RANGE COUNTY, NORTH CAROLINA", and Com-
missioner Klein seconded the motion, and the resolution was
passed by the following vote: =
Ayes : Unanimous
4 .
i
Noes :
*
I, Maury Klein, Secretary of The Orange County Industrial
Facilities and Pollution Control Financing Authority and keeper of
the official minutes thereof, DO HEREBY CERTIFY that the foregoing
is a true copy of certain of the proceedings of the Board of Com-
missioners of the Authority taken at a meeting held at the time
and place shown on the front page of these excerpts of minutes and
is a complete copy of so much of the recorded minutes of said
meeting as relates in any way to the passage of the resolution
hereinabove set forth.
I DO HEREBY FURTHER CERTIFY that, pursuant to Article II of
the By-laws of the Authority, I gave all members of the n Authority
written notice of said meeting not less than twenty-four y four hours s
prior to the time shown on the front page of these o excerpts
minutes, and that, at least forty-eight p of
Y-eight hours before said meeting,
posted such notice on the principal bulletin board or at the
door
of the usual meeting room of the Authority and mailed or delivered
such notice to each newspaper, wire service, radio station,
television station and person that had filed with me a written
request for notice pursuant to G.S. 143-318. 12.
5.
1 r
1 I.
WITNESS my hand and the official seal of The Orange Count y
Industrial Facilities and Pollution Control Financing Authority
this 25th day of February, 1985. -
vt
- Secretary -
•
•
•
6.
,
• .
,
,
. .
. . •
. .
. .
411
THE BOARD OF COMMISSIONERS FOR THE
COUNTY OF ORANGE, NORTH CAROLINA
Extract of minutes of a public hearing on an industrial
• development revenue bond issue to finance an industrial
•
project for Isotechnologies, .Inc. and otclibmtriz:t:prizIp:f
the issuance of not exceeding $1,500
amount of industrial development revenue bonds of The Orange
County Industrial Facilities and Pollution Control Financing
Authority to finance the industrial project and approval of
the industrial project.
The Board of Commissioners for the County of Orange, North
Carolina met in regular session in the Commissioners ' Meeting
Room of the Orange County Courthouse, 106 East Margaret Lane in
• HIllsborough, North Carolina, the regular .place of meeting, at
6:00 P.M. , on April 7, 1986.
T
he following Commissioners were: .
0 Present: Commissioners Moses Carey- Ben Llo Shirle Marshall,
Norma Wn ,- ; . DO4 Wi _ Oo
o
Absent:
Also Present: Geoffrey Gledhill, County Attorney; -----
-
z,
i * * * * *
'4
i At IL:al P.M. , the Chairman of the Board of Commissioners
f
1 for the County of Orange (the "Board" ) announced that the Board
would proceed to hold a public hearing and would hear anyone who
!
wished to be heard on the proposed issuance by The Orange County
-
Industrial Facilities an Pollution Control Financing Authority
0
_
ID ( the Author
( "Authority") of not exceeding $1,500,000 aggregate principal
amount of its industrial development revenue bonds to pay all or
a portion of the cost of the acquisition of a tract of land of
approximately 20 acres located, eas- t of Hillsborough,9 , North
Carolina on State Road 1879 or Elizabeth Brady Road near the
s
intersection of State Road •1879 and_L- U.S. 70, the construction
thereon of an approximately 30,000 square foot building and the
acquisition and installation therein of machinery and equipment
, ,.� ( the "Industrial Project") . The Industrial Project is to be
owned and operated by Isotechnologies, Inc. , a North Carolina
corporation (the "Company") .
The Chairman stated that the Authority had adopted a
resolution expressing its intention to issue industrial
development revenue bonds and authorizing the execution and
delivery of a memorandum of agreement pertaining to the financing
of the Industrial Project for the `.Company. The Chairman then
submitted copies of the resolution and the memorandum of
agreement to the Board.
The Clerk to the Board presented affidavits showing
publication in the newspapers on the dates detailed on Schedule A
of notice of the public hearing. The_ Chairman directed that the
affidavits of publication be attached to this extract of minutes
as Exhibit A.
The Chairman requested that theTelerk to the Board inquire
elsewhere in and around the Commissioners ' Meeting Room to
2.
;I determine whether there were any other persons who wished to
speak at the public hearing. The Clerk to the Board returned
' after makin g such inquiry to report that no other persons who
,ji wished to speak at the public hearing were found. The names
` and addresses of the persons who were r
x, present and who offered
comments on the proposed issuance of the industrial develop-
:ga
ment revenue bonds to finance the Industrial Project are as
it= follows:
rf 1. Mr. a. B. Martin, Vice-president and General
Manager, 50.1 S. Greensboro Street, Carrboro, North
`, Carolina, 27510
aj
2. Mr. Tom Coleman, Vice-president of operations,
501 S. Greensboro Street, Carrboro, N.C. 27510
3. Mr. Thomas K. Tiemann, 118 Lafayette Drive/
Hillsborough, North Carolina 27278
•
At 8:50 P.M. , (at least 10 minutes after the time shown
on page 1 as the time of the start of the public hearing) ,
the Chairman requested that the Clerk to the Board in
again elsewhere in and around the Commissioners . Meetin inquire
AF
, g Room
to determine whether there were any other persons who wished
to speak at the public hearing. The Clerk to the Board
returned after making such inquiry to report that no other
1
persons who wished to speak at the public hearing were found.
und.
After the Board had heard all persons who had requested
to be heard.; Chair Willhoit closed the public hearing.
The Chairman stated that under the Internal Revenue Code
of 1954 as amended the Board must approve the issuance of the
-3-
Authority' s industrial development revenue enue bonds if the interest
thereon is to be exempt' from federal income tax.
Commissioner Wilihoit then introduced the
following resolution, a copy of which - was distributed to each
Commissioner and the title of which was read: •
RESOLUTION APPROVING THE ISSUANCE OF NOT EXCEEDING
$1,500,000 AGGREGATE PRINCIPAL AMOUNT OF INDUSTRIAL
DEVELOPMENT REVENUE BONDS OF=-.THE ORANGE "COUNTY
INDUSTRIAL FACILITIES AND POLLUTION CONTROL FINANCING
AUTHORITY TO FINANCE AN INDUSTRIAL PROJECT FOR
ISOTECHNOLOGIES, INC. AND APPROVING THE INDUSTRIAL
PROJECT.
WHEREAS, the Board of Commissioners for the County of Orange
(the "Board") has created a political subdivision and body
corporate and politic of the State of North Carolina known as
"The Orange County Industrial Facilities and Pollution Control
Financing Authority" (the "Authority" ) ; and
- WHEREAS, the Authority is authorized under the Industrial
and Pollution Control Facilities Financing Act, Chapter 159C of
the General Statutes of North Carolina, as amended ( the "Act") ,
to issue revenue bonds for the purpose, among others, of paying
all or any part of the cost of any industrial or pollution
control project for industry; to acquire, construct, improve and
equip any such project; and to make and execute financing
a agreements, security documents and other contracts and
instruments necessary or convenient nn the exercise of such
p o�.aers; and
A °
4 .
. , r z-- -,
WHEREAS, the Authority has determined to issue not exceeding
1 $1, 500,000 aggregate principal amount of its industrial develo -
i
i P
ment revenue bonds to pay all or a portion of the cost of the
Iacquisition of a tract of land of- approximately 20 acres located
east of Hillsborough, North Carolina on State Road 1879 or
e
,
1 . Elizabeth Brady Road near the intersection of State Road 1879 and
a- U.S. 70, the construction thereon of an approximately 30,000
it,
4, square foot building and the acquisition and installation therein
4
of machinery and equipment (the "Industrial Project") , which
Industrial Project is to be owned and operated by
Isotechnologies, Inc. a North Carolina corporation (the
"Company") ; and
WHEREAS, the Authority intends to file an application
for
approval of the Industrial Project with the Secretary of the
Department of Commerce (the "Department" ) , as required by the
Act; and
WHEREAS, the Department has, by regulation, provided that no
application for approval of a proposed industrial project by the
Department will be officially received until the governing body
of the county from which the application is made has, by
resolution after having held a public hearing, approved the issue
1
of industrial development revenue bonds and approved the proposed
industrial project and a certified copy of such resolution has
been provided to the Department; and
■ 0
5.
..T .w^• ■w:.•
WHEREAS, Executive Order 113 of the Governor of the State of
North Carolina provides that prior to the time that the volume
capacity with respect to private activity bonds set forth in the
Deficit Reduction Act of 1984 is allocated to the Industrial
Project, application must be made to the Department;' and
WHEREAS, the Board, pursuant to public notice duly given,
has held a public hearing on the proposed industrial development
revenue bond issue and Industrial -Project and has considered the
comments of persons who requested to be heard; and
WHEREAS, the Board desires to approve the issuance of the
industrial development revenue bonds and the Industrial Project;
NOW, THEREFORE,
BE IT RESOLVED by the Board as follows:
1. The issuance of not exceeding $1,500,000 aggregate
principal amount of industrial development revenue bonds of the
Authority to finance the Industrial Project is hereby approved.
2. The Industrial Project is hereby approved.
3. The Clerk to the Board is hereby directed to apply to
the Department for an allocation in an amount not to exceed
$1,500,000 pursuant to Executive Order 113 of the Governor of the
State of North Carolina, such application to be evidenced by
sending a certified copy of this resolution to the Department.
Any such allocation shall be only for purposes of the Industrial
Project.
•
6 .
4. The Clerk to the Board is hereby authorized and directed
to provide a certified copy of this resolution to the Department.
5. This resolution shall take effect immediately upon its
passage.
Commissioner Carey
y moved the
passage of the foregoing resolution entitled "RESOLUTION
APPROVING THE ISSUANCE OF NOT EXCEEDING $1,500,000 AGGREGATE
':; (I . PRINCIPAL AMOUNT OF INDUSTRIAL DEVELOPMENT REVENUE BONDS OP THE
ORANGE COUNTY INDUSTRIAL FACILITIES AND POLLUTION CONTROL
FINANCING AUTHORITY TO FINANCE AN INDUSTRIAL PROJECT FOR
ISOTECHNOLOGIES, INC. AND APPROVING THE INDUSTRIAL PROJECT", and
Commissioner t 5rshall seconded
_ the motion, and
the resolution was passed by the following vote:
• Ayes : Moses Carey, Ben Lloyd, Shirley Marshall, Norman Walker and
Don Willhoit
Noes: None
* * * * *
I, Beverly Blythe, Clerk to the Board of Commissioners for
the County of Orange, North Carolina, DO HEREBY CERTIFY that the
foregoing is a true and complete copy of so much of the public
hearing and other proceedings of the Board of Commissioners for
said County, at a meeting held at the time and place shown on the
front page of these excerpts of minutes, as relates in any way to
ST
the public hearing and resolution hereinabove set' forth.
1 400
7.
F_V .
• I DO HEREBY FURTHER CERTIFY that a schedule of regular meet-
ings of said Board, stating that regular meetings are held on the
first Monday of each month at 7 :30 P.M. in the Commissioners '
V Meeting Room of the Orange County Courthouse, 106 East Margaret
Lane in Hillsborough, North Carolina, and on the third Tuesday of
: 3 each month at 7:30 P.M. in the Commissioners ' Meeting Room of the
Courthouse in the Old Post Office, 147 East Franklin Street,rr
:w Chapel Hill, North Carolina, has been on file in my office pur-
suant to G.S. _ 143-318.12 as of a .:date not less than seven days
before said meeting.
WITNESS my hand and the official seal of Orange County this
7th day of April, 1986.
,` f 1 _
Clerk to the �p. r: of Co n "oners
(SEAL) ✓
. S hedule A
r w
Nes a er
Published
Chapel Hill Newspaper
Durham Sun March 24, 1986
March 24, 1986
•
•
�nrrran� Cwwq w"°".:
, � .
.'(/ AFFIDAVIT OF PUBLICATION
nrp.e* .
anew not M°�or°a iwrrow M�woman awi�w
ouremiona lommEP to Mame le dos Imo.
State of North Carolina 'M,.Manna r�r M_drama,110
County of Durham „e,�„ r a�.w
1ywwR r•_"-.r.-,,
LInnimerionialOPareptie Tr MOW bolt_
Donna B. Minor �+..�'w.l-.r_ WO arobh
being duly sworn r��:�'"iet
says that she is the Principal Clerk of I r` u.1%moo`sa tad
f The Durham * �+- "" k ..r.
Herald Co. , � rIf►errewnai one Malabo Ceara Andasno Atiterwr
'; Inc . publishers of Fzo n61 vim. *
1. •'•S OM oaks 11101 y of Craw am
C ge ss Or Roo Coady
Ms Com DI Cantor
law&$06 East A newspaper published in and of general
bola Casaba or r:30 PAL,of
circulation in said County, • ear nosayanb
Y, and that a �,. c +e wr.e.rnrrwr w
,ti notice of which the annexed is a true � "" es
,.
copy, was published in said newspaper one « Ada ewe
law eaten an ore nsois,, aaor blo ens
k: time Any reerren„Insm,°°°'e/°"'r„►ecr�""°'w
la bomb wog mod hip°4 conrriar in wrists.,an
017 the submisst� a An t nd in td om by
24th day o f i .nut:ono s""'te do so l "�,nrM.n n.°"'�doles
Mares 19 86 non+e•nr aw�to nro a anal.a t r.
M f7 r •
unary aborato-r of Re_Donsoinnon of Claw
Principal C erkt'ie
Wont briar.OMR"
cer.lrsa ie"sp`r' sa.rt, �otoktt►
Sworn to and subscribed before me this s...: ,�r Consume
.r 15th day of ril
19 86 •
a L ( 4 ✓ t% /)LJ-
Notary Public
My commission expires
My Commission Expires Dec. 16, 1986
Durham County, North Carolina
IMMUmmmormir
Exhibit A (cont. )
d
t' r
_ __ CERTIFICATE OF PUBLICATION
• OF PUBLIC HEARING Facilities and Pollution Contra!
INTENTION TO SUBMIT Fhtancing Authority entered into a
ME DEPARTMENT OF . memorandum of Agreement with
AN APPLICATION
rE
PROVAL OF AN �'t��iD ��•Inc.on December
RIALPROJECT d• ItiaS and a Supplemental ,ge County Industrial lwtpmorandum of Agreement oo I, Mary Nies
ad Pollution Control Fet�rurary t5. 19e6.A u tbo o t y has Pitase take notice that the Board do hereby certify that I am the
. determined of county Commissioners far the
to °minty of Orange will hold a public Bends due bonds (the bearing In the Commissioners' Assistant Advertising Coordinator
�, in an aggregate Meeting Room of the Orange
principal amount not exceeding County Courthouse, 106 East of the Chapel Hill Newspaper stew
$IJOO 00 of the coat of all or Margaret Lane, in Hillsborough,
newspaper published in
North Carolina'on April 7, y,
•
project and intends tosubmitto� 7:30 p.m., at which time an ChapelNill'Or eCottrtt N_C.andthattheattached
Secretary of the Department of person may bebeard Y
Commerce an application for issuance of such rids and the
in re Public Rearing by Orange County
the issuan of industrial project if Industrial Project. Following the Board of Commissioners
Bonds and the bearing, the Board of County _
ib�cal project are approved by Commissioners intends to consider
Board of County and take action on
'Commissioners for the County of approve the issuancepofasuch
Tl�ei,North Bonds and the Industrial Project,
project consists of Any person wishing to comment was printed in the said Chapel Hill Newspaper in the
approximately acquisition of a tract of land of in writing on the Bonds and the
20 acres located Industrial Project and the issues of
east of Hillsborough, North March 24, 1986
Carolina on Stale Road 11179 or submission of the application in -
Carolina 1 Brady ta Road near the connection therewith should do so,
ersection of State Road 11179 and within fourteen(14?days notice,the
US.70,the fiction thereon of date u horityand to this noti rd,to
in approximately 30, - the Authority and to the Board of
Y 000 square County Commissioners, c/o the Si T T -,
foot building and the acquisution undersigned. Clerk to the County gned
and installation therein of Board of Commissioners, Orange
nacbinery and equipment (the County Courthouse. 106 East
'Industrial Project"), The. Margaret Lane. Hillsborough,
mtrial Project Will be wed North Carolina 27278 and to Mr.
peerratte by Is0technologies• Kevin Kennely,Deputy Secretary Sworn and subscribed to before me,a Notary Public,on
Carolina corporation, of the Department of Commerce,
rill create employment for 430 North Salisbury Street. the 77 ,
approximately 16 persons and day of— -�-• 19- ��
)reserve employment for Raleigh. North Carolina 27611.
'ppr°stmately 20 persons in in Chapel Hill, N.C.
'')range County and the Beverly Blythe
`urrounding area, and will cost of Clerk to the or the
approximately =1.500,000. The Commissioners for the
.)range .County Industrial County of Orange.North Carolina
March 24. 1986
Notary Publm
My commission expires .-1 i < <
� :
_;�
•
./
• . COLEMAN. BER\IIOLZ, DICKERSO\,
�s
BFRNIjOLZ, GLEDHILL & HARGR:�VE
ATTORNEYS AT L..Aw
N
ri 110 CHURTON STREET
'' HILLSBOROUGH. N.C. 27278
919-732-2106
919-942 8000
CRAPE I. HILL OFTICE
SUITE 20.FRANKLIN BUILDING
137 E.FRANKLIN STREET March 21 , 1986
II CHAPEL HILL.Y.C.27514
919-929-7151
ALONZO B.COLEM N.JR_
STEVEN A.BEENIIOLZ
DONALD R.DICK LRSON
ROGER B.BERNHOIZ
OEOFF'REY E.OLEDHILL
DOUGH H GRAYS Mr . Kenneth R. Thompson
RICHARD J.SPIDER, IR. Orange County Manager
O. HOL S SSOVOv 106 E. Margaret Lane
LYNN A.ANDREWS
Hillsborough , North Carolina 27278
Or Counsel
BANNER D.SAWYER Re: Isotechnologies,ER D. 9 , Inc . Industrial
Revenue Bond Financing
Dear Ken:
, :
Enclosed is a copy of the notice of the public
hearing that the Board of County Commissioners will
hold regarding the Orange County Industrial Facilities
and Pollution Control Financing Authority application
for Industrial Revenue Bonds to finance an industrial
project on behalf of Isotechnologies,
will appear in the Durham Sun and the Chapel THillnotice
neWspaper on March 24 , 1986. Also enclosed is the
proceedings of the Board of County Commissioners
regarding the public hearing and the approval of the
project in principle. This document should be part of
the agenda package and should become a permanent part
of the minutes of the Board for the April 7, 1986
meeting. In that regard , enclosed are the regulations
promulgated by the North Carolina Department of
Commerce and contained in the North Carolina
Administrative Code which detail the scope of the
presentation by the project owner and the role of the
Board of County Commissioners.
questions concerning any of this, you have any
this, please advise.
•
Very ,truly yours ,
•
Ge fre E. Gl dhill
GEG/lsg
Enclosures
cc: Tom Coleman \
Sylvia Price
Tom Tiemann �.--- r
Eric Vernon
)011,lir
r
NOTICE OF PUBLIC HEARING AND INTENTION TO SUBMIT TO THE
DEPARTMENT
APPLICATION FORAPPROVALL OF AN INDUSTRIAL PROJECT
The Orange County Industrial Facilities and Pollution Con-
,
, . trol Financing Authority has determined to issue its industrial
development revenue bonds ( the "Bonds") in an aggregate principal
amount not exceeding $1, 500, 000 for the financing of all or a
portion of the cost of an industrial
submit to the Secretary of the Department pof �Commerce an applica-
tion for approval of the industrial project if the issuance of
the Bonds and the industrial project are approved by the Board of
County Commissioners for the County of Orange, North Carolina.
The industrial project consists of the acquisition of a •
tract of land of approximately 20 acres located east of
Hillsborough, North Carolina on State Road 1879 or Elizabeth
ii Brady Road near the intersection of State Road 1879 and U.S.
t the construction thereon of an approximately 30,000 square foot
building and the acquisition and installation therein of machin-
t ery and equipment
(the "Industrial Project" ) . The Industrial
Project will be owned and operated by Isotechnologies, Inc. , a
North Carolina corporation, will create employment for ap-
proximately 16 persons and preserve employment for approximately
20 persons in Orange County and the surrounding area, and will
cost approximately $1, 500 ,000. The Orange County Industrial
Facilities and Pollution Control Financing Authority entered into
a Memorandum of Agreement with Isotechnologies, Inc. on December
6, 1985 and a Supplemental Memorandum of Agreement on February
25, 1986.
Please take notice that the Board of County Commissioners
I for the County of Orange will hold a public hearing in the
Commissioners ' Meeting Room of the Orange County Courthouse, 106
East Margaret Lane, in Hillsborough, North Carolina on April 7,
1986, at 7: 30 P.M. , at which time any may
regarding the issuance of such Bonds and theeIndustrial br oject.
Following the hearing, the Board of County Commissioners intends
to consider and take action on proposals to approve the issuance
of such Bonds and the Industrial Project.
Any person wishing to comment in writing
the Industrial Project and the submission of the application ain
connection therewith should do so, within fourteen (14) days
after the date of publication of this notice, to the Authority
and to the Board of County Commissioners, c/o the undersigned,
Clerk to the County Board of Commissioners, Orange Count
Courthouse, 106 East Margaret Lane, g County
Hillsborough,
27278 and to Mr . Kevin Kennelly, North Carolina
De ut
Department of Commerce, 430 North Salisbury Secretary Street, Ralf the of
`i North Carolina 27611. eigh,
Beverly Blythe
Clerk to the Board of Commissioners for
the County of Orange, North Carolina
iiiiiiii
Draft : 6/9/86
BOND PURCHASE AGREEMENT
This BOND PURCHASE AGREEMENT dated as of July 1, 1986 ( the
"Bond Purchase Agreement" ) , among THE ORANGE COUNTY INDUSTRIAL
FACILITIES AND POLLUTION CONTROL FINANCING AUTHORITY, a body
corporate and politic and a political subdivision of the State of
North Carolina ( the "Authority" ) , NCNB NATIONAL BANK OF NORTH
CAROLINA, a national banking association having its principal
office in Charlotte, North Carolina ( the "Purchaser" ) , and
ISOTECHNOLOGIES, INC. , a corporation duly incorporated in the
State of North Carolina ( the "Company" ) ,
W I T N E S S E T H :
WHEREAS, the Authority intends to issue and sell to the
Purchaser its industrial revenue bond in the principal amount of
$1, 500, 000 (the "Bond" ) to finance the cost of acquisition of real
property, the construction thereon of a building and the acquisi-
tion and installation therein of machinery and equipment ( the
"Project" ) , to be used by the Company as a manufacturing facility;
intends to provide for the acquisition, construction and
installation ( the "Acquisition" ) of the Project pursuant to a Loan
Agreement, of even date herewith ( the "Loan Agreement") , between
the Authority and the Company; and intends to secure the Bond by
(a) an Assignment, of even date herewith (the "Assignment" ) , from
the Authority to the Purchaser, pursuant to which the Authority
will assign to the Purchaser, its successors and any transferee of
the Bond in accordance with Section 7 hereof
( the
certain of its rights under the Loan Agreement, and nder„thedDeed
of Trust and the Security Agreement, as each is hereinafter
defined, and will endorse without recourse to the order of, and
pledge to, the Purchaser a promissory note (the "Note") issued by
the Company pursuant to the Loan Agreement, (b) a Security
Agreement, of even date herewith ( the "Security Agreement" ) ,
y
between the Company and the Authority, )
personal property and fixtures more fully described ntherein, (C) a
Deed of Trust, of even date herewith (the "Deed of Trust") , from
the Company to , as trustee for the benefit of the
Authority, relating to certain real property more fully described
therein, (d) a Guaranty Agreement, of even date herewith
"Company Guaranty" ) , from the Company to the Purchaser, ( the
to which the Company unconditional) pursuant
Bond and (e) a Guaranty Agreement, guarantees sdate here herewith of the
"Personal Guaranty" ) , from Mr . and Mrs. Jerome J. Richardson (the
"Personal Guarantors" ) to the Purchaser , pursuant to which the
Personal Guarantors unconditionally guarantee the payment of the
Bond ( this Bond Purchase Agreement , the Bond, the Loan Agreement ,
the Note, the Assignment, the Deed of Trust, the Security
Agreement, the Company Guaranty and the Personal Guaranty herein
sometimes called collectively the "Bond Documents" ) ; and
WHEREAS, the Authority, the Purchaser and the Company desire
to set forth certain terms and conditions with respect to the
purchase, sale and issuance of the Bond, the custody and applica-
tion of the proceeds thereof, and the custody and application of
funds received for the purpose of paying the principal thereof and
the premium, if any, and interest thereon; now, therefore,
The parties hereto agree as follows:
Section 1 . Issuance and Purchase of Bond. The Authority
shall issue the Bond substantially in the form attached as Exhibit
A hereto. The Bond shall be in the principal amount of
$1 ,500,000, shall be designated "The Orange County Industrial
Facilities and Pollution Control Financing Authority Industrial
Revenue Bond ( Isotechnologies, Inc. Project) " , shall be dated of
even date herewith and shall be stated to mature on July 1, 1996,
subject to mandatory prepayment and to the right of optional
prepayment, all as set forth in the Bond. In reliance upon the
representations, warranties and agreements herein contained, and
subject to the conditions herein set forth, at the Closing Time
(hereinafter defined) : the Authority agrees to issue and sell the
Bond to the Purchaser, to enter into the Loan Agreement and the
Assignment in the forms of Exhibits B and C, respectively, hereto,
and to pledge to the Purchaser the Note, endorsed without recourse
to the order of the Purchaser, as security; the Purchaser agrees
to purchase the Bond from the Authority; and the Company agrees to
enter into the Loan Agreement, the Security Agreement, the Deed of
Trust and the Company Guaranty in the forms of Exhibits B, D, E
and F, respectively, hereto, to cause the Personal Guarantors to
enter into the Personal Guaranty in the form of Exhibit G hereto,
to execute the Note in the form of Exhibit A to the Loan
Agreement, and to consent to the pledge of the Note, endorsed
without recourse to the order of the Purchaser, and to the
Assignment, all as security for the Bond. Payment for the Bond
shall be made, by deposit to the account of the Authority in the
Project Fund provided for by Section 9 hereof, at 10:00 A.M. ,
local time, on July , 1986 at the offices of the Purchaser in
° the City of Chapel H 1l, North Carolina, or at such other time,
date and place as may be mutually agreed upon by the arti
hereto (the "Closing Time" ) . p y p es
2 .
Section 2. Representations, Warranties and Agreements of the
Authority. The Authority hereby represents and warrants to, and
agrees with, the Purchaser as follows :
(a) The Authority is a political subdivision of the
State of North Carolina ( the "State" ) and a body politic and
corporate, duly created and existing under Chapter 800 of the
1975 Session Laws of North Carolina, as amended, which as
codified appears as Chapter 159C of the General Statutes of
North Carolina ( the "Enabling Act") . The Authority is
authorized to issue industrial development revenue bonds in
accordance with the Constitution and the laws of the State,
including the Enabling Act, and to use the proceeds thereof
to acquire, own, lease and dispose of properties, or to lend
the proceeds thereof for the construction or acquisition of
properties, in order to promote industry and to develop trade
by inducing manufacturing and industrial enterprises to
locate or remain in the State.
(b) The Authority has full power and authority to issue
the Bond pursuant to the Enabling Act and to carry out and
consummate all transactions contemplated by the Bond
Documents to which it is a party.
(c) The Authority has duly authorized: ( i ) the issu-
ance and sale of the Bond; (ii) the execution, delivery and
due performance of the Bond Documents to which it is a party;
(iii) the pledge of the Note, endorsed without recourse to
the order of the Purchaser, to the Purchaser as security; and
(iv) the taking of any and all action as may be required on
the part of the Authority to carry out, to give effect to and
to consummate the transactions contemplated hereby and by the
other Bond Documents . The Bond fully executed, the executed
Note duly endorsed to the order of the Purchaser, fully
executed counterparts of the Bond Documents to which it is a
party and certified copies of the resolution of the Authority
authorizing the Authority's undertakings contemplated hereby
(the "Bond Resolution") shall be delivered to the Purchaser
by the Authority at the Closing Time, and they shall be in
the respective forms theretofore submitted to the Purchaser
and approved by the Purchaser, with only such changes or
modifications thereof as the Purchaser, the Company and the
Authority shall agree upon.
(d) So long as the Bond is outstanding, the Authority
will not issue or sell any bonds or obligations (other than
the Bond) , the interest or premium, if any, on or principal
of which shall be payable in whole or in part from the
revenues derived from the Note.
3.
(e) There is no action, suit, proceeding or inves-
tigation at law or in equity or before or by any court ,
public board or body pending or, to the knowledge of the
Authority, threatened against or affecting the Authority, or
to the best of the knowledge of the Authority any basis
therefor, wherein an unfavorable decision, ruling or finding
would adversely affect any of the transactions contemplated
by this Agreement, or which, in any way, would adversely
affect the validity of the Bond Documents, or any other
agreement or instrument to which the Authority is a party and
which is used or contemplated for use in consummation of the
transactions contemplated hereby.
(f) The execution and delivery of the Bond Documents to
which it is a party and the other agreements and instruments
contemplated hereby and in compliance with the provisions
hereof and the endorsement and pledge of the Note as
aforesaid will not conflict with, or constitute on the part
of the Authority a breach of, or a default under, any
existing law, administrative regulation, decree, court order
or any provision of any legislative act, constitutional or
other proceeding applicable to or establishing or relating to
the establishment of the Authority or its affairs or
resolutions, or any agreement, indenture, mortgage, lease or
other instrument to which the Authority is subject or by
which it is or may be bound.
(g) All action on the part of the Authority necessary
for the making and performance of the Bond Documents to which
it is a party and the other transactions on the part of the
- Authority contemplated hereby or thereby has been duly and
effectively taken. All consents, authorizations and
approvals of, or filings or registrations with, all
governmental or regulatory bodies required of the Authority
for the making and performance of the Bond Documents to which
it is a party and the transactions contemplated hereby and
thereby, have been duly and effectively taken.
(h) All requirements and conditions specified in the
Enabling Act, the by-laws or other organic documents of the
Authority and all other laws and regulations applicable to
the adoption of the Bond Resolution, the execution and
delivery of the Bond Documents to which it is a party and the
execution, delivery and issuance of the Bond have been
fulfilled.
( i) The Authority shall take all action and do all
things which it is authorized by law to take and do in order
to perform and observe all covenants and agreements on its
part to be performed and observed under the Bond Documents to
4.
me
which it is a party and in order to provide for and to assure
payment of the Bond and any premium and the interest thereon
when due, but solely in accordance with and subject to the
limitations contained in the Bond Documents to which it is a
party.
( j ) The Authority shall not alter, amend or repeal the
Bond Resolution, or , without the prior written consent of the
Holder , agree to any alteration or amendment of the Bond
Documents to which it is a party or take any action impairing
any authority, right or benefit given or conferred by the
Bond Resolution or the Bond Documents to which it is a party.
Section 3 . Representations, Warranties and Agreements by the
Company. The Company hereby represents and warrants to, and
agrees with, the Purchaser as follows:
(a) The Company confirms its representations,
warranties and agreements set forth in the Loan Agreement .
(b) The executed Note endorsed to the order of the
Purchaser, fully executed counterparts of the Bond Documents
to which it is a party and certified copies of the reso-
lutions of the Board of Directors of the Company authorizing
the Company' s undertakings contemplated by the Bond Documents
to which it is a party, shall be delivered to the Purchaser
by the Company at the Closing Time, and they shall be in the
respective forms theretofore submitted to the Purchaser and
approved by the Purchaser, with only such changes or
modifications thereof as the Purchaser, the Company and the
Authority shall agree upon. Each of the Bond Documents to
which the Company is a party is enforceable against the
Company in accordance with its terms.
(c) Notwithstanding any other provision of this
Agreement, the Company covenants that ( i) it will make no use
of the proceeds of the loan made by the Authority hereunder,
of any of its funds, or of the Bond which would cause the
Bond to be an "arbitrage bond" within the meaning of Section
103(c) of the Internal Revenue Code of 1954, as amended ( the
"Code" ) , or Treasury Department Regulations promulgated
thereunder as at the time in effect, and (ii) so long as the
Bond is outstanding, it will comply with the requirements of
said Section 103(c) and the applicable Treasury Department
Regulations promulgated thereunder.
(d) The Company warrants that there is no action, suit
or proceeding at law or in equity or by or before any
governmental agency or authority or arbitral tribunal now
pending or to the knowledge of the Company, threatened
5 .
against or affecting the Company or its subsidiaries or any
properties or rights of the Company or its subsidiaries ,
which if adversely determined would impair the ability of the
Company or its subsidiaries to carry on its business as now
conducted or would materially adversely affect its financial
condition.
(e) The Company warrants that it has filed all required
federal, state and local income tax returns as they have
become due. The Company g e
discharge all taxes, assessments and governmental charges and
levies imposed upon it or upon its income or profits arges or
n
any of its property prior to the date on which penalties on
attach thereto, except that the Company will not be required
to pay any such tax, assessment, charge or levy, the payment
of which is being contested in good faith and by proper
proceedings in such manner as not to cause any materially
adverse effect upon its financial condition or the loss of
any right of redemption from any sale thereunder and against
which it shall have set aside on its books reserves
(segregated to the extent required by sound accounting
practices) .
(f) The Company agrees that it will pay all govern-
mental charges or taxes (except income, franchise or similar
taxes) at any time payable or ruled to be payable in respect
of the existence, execution or delivery of the Bond Documents
or issuance of the Bond by reason of any existing or
hereafter enacted federal or state statute.
Section 4. Conditions of Purchaser 's Obligations to
Purchase. The Purchaser shall accept delivery of the Bond only
upon the following conditions:
(a) The Bond Documents, all in form satisfactory to the
Purchaser, shall have been executed and delivered to, the
Note shall have been executed and endorsed without recourse
to the order of and pledged to, the Purchaser, the Deed of
Trust shall have been duly recorded and appropriate financing
statements under the Uniform Commercial Code shall have been
filed.
(b) The Purchaser shall have received ( i ) evidence,
reasonably satisfactory to the Purchaser, of the due
authorization, execution and delivery of each of the Bond
Documents by the respective parties thereto, and (ii )
appropriate certificates satisfactory to the Purchaser
covering litigation, compliance with laws and prior agree-
ments, securing and fulfilling all necessary permits and
6.
requirements and ( iii ) opinions of counsel reasonably
satisfactory to the Purchaser with respect to the foregoing .
(c) The Purchaser shall have received a copy, duly
certified by the Secretary or an Assistant Secretary of the
Authority, of the Bond Resolution mentioned in clause (c) of
Section 2 hereof and copies each duly certified by the
Secretary or an Assistant Secretary of the Company of the
resolution mentioned in clause (b) of Section 3 hereof.
(d) The receipt by the Purchaser of the opinions of
counsel substantially in the forms of Exhibits H, I and J
hereto.
(e) Certificates and policies of insurance, or binders
therefor, required by the Loan Agreement shall have been
delivered to the Purchaser in form satisfactory to the
Purchaser .
( f) The receipt by the Purchaser of ( i ) a boundary
survey of the Project site, ( 2) a flood plain certificate,
( 3) plans and specifications for the Project, ( 4) the
building permit and zoning approvals ( 5) the general
construction contact, ( 6) the supervising architect ' s
contract, and (7) a certified cost breakdown for the Project .
The supplying
certificates as may bereasonably h
required byc the nPurchaser .
Section 5 . Conditions of the Authority's Obligations. The
issuance by the Authority of the Bond hereunder is subject to the
conditions set forth in Section 4 hereof.
Section 6. Execution. The Bond shall be executed on behalf
of the Authority by the Chairman or Vice Chairman of the Authority
and shall have impressed thereon the official seal of the
Authority attested by the Secretary or an Assistant Secretary of
the Authority. In case any officer whose signature shall appear
on the Bond shall cease to be such officer before the delivery of
4. the Bond, such signature shall nevertheless be valid and suffi-
cient for all purposes, the same as if such person had remained in
office until delivery.
Section 7. Purchase for Investment and Investigation in
Connection with Purchase. The Purchaser represents and warrants
to and covenants with the Authority and the Company that, in
purchasing the Bond, it is making a commercial loan in the
ordinary course of its banking business with no present intention
of distributing or selling the Bond or any part thereof or any
interest therein. The Purchaser reserves the right to dispose of
7.
iii ..
the Bond or any part thereof or any interest therein to another
bank or to an insurance company or other financial institution;
provided, however, that no public offering of all or any part of
the Bond or of any interest therein shall be made. The Purchaser
understands that the Bond has not been registered under the
Securities Act of 1933 , as amended. The Purchaser acknowledges
that in purchasing the Bond it is not relying upon any
representations of the Authority with respect to the financial
quality of the Bond. The Purchaser is relying solely upon
statements and representations of the Company and upon its own
knowledge and investigation of the facts and circumstances
relating to the purchase of the Bond.
The Purchaser represents that it has made its own independent
evaluation of the creditworthiness of the Company.
The Authority and the Company have made available to the
Purchaser, during the course of the transaction and prior to the
purchase of the Bond, the opportunity to ask questions and receive
answers from such parties concerning the terms and conditions of
the Bond offering and to obtain such additional information
relative to the financial data and business of such parties and
such property to be conveyed in trust or otherwise used as
security, to the extent that such parties possess such information
or can acquire it without unreasonable effort or expense, as the
Purchaser shall have deemed necessary and appropriate in the
circumstances.
The Bond shall be issued in a form payable to the Purchaser
or a subsequent Holder, and the Purchaser shall be deemed and
regarded as the absolute owner thereof for all purposes and
payment of or on account of the principal of and interest on the
Bond shall be made only to or upon the order of the Purchaser,
whether or not any transfer thereof shall be made, until the
Authority and the Company shall have received from the transferor
written notice of such transfer, including the name and address of
the transferee. All such payments shall be valid and effectual to
satisfy and discharge the liability upon the Bond to the extent of
the sums so paid whether or not any transfer thereof shall be
made, until the Authority and the Company shall have received
written notice of such transfer, including the name and address of
the transferee. Each transferor shall give, within 10 days after
any disposition of the Bond or of any interest therein, written
notice to the Authority and the Company of such disposition.
Thereafter, the transferee, if the disposition otherwise complies
with the requirements of this Section, shall be deemed a Holder
for purposes of this Agreement and shall succeed to the rights and
be bound by the obligations of a Purchaser hereunder .
8.
Section 8 . Notation of Payments. The Holder shall permit
the Authority, at any time during regular business hours , to make
at its office an appropriate notation or notations on the Bond of
payments of principal thereof , if at least five days prior thereto
the Authority shall have given written notice of its intention to
do so and if it shall not have received from such Holder a written
confirmation that the requested notation or notations shall have
been made by such Holder. In the event that the Bond shall be
transferred as permitted by Section 7 hereof, the transferor will
make or will cause to be made notations thereon of all payments of
principal with respect to which no prior notations have been made
and of the date to which interest thereon has been paid.
Section 9 . Proiect Fund. The proceeds of the sale of the
Bond to the Purchaser shall be set aside in trust with NCNB
National Bank of North Carolina, at its office in Charlotte, North
Carolina, as depositary ( the "Depositary" ) , for the account of the
Authority but for the benefit of the Company in a special account
designated "The Orange County Industrial Facilities and Pollution
Control Financing Authority ( Isotechnologies,
Project Fund" (the "Project Fund" g Inc. Project)
of the Project Fund, from time to )time,h amounts Depositary shall pay the
principal amount of the Bond and the net amount tofexceeding any income
realized through the investment of amounts held for the credit of
the Project Fund) required to pay the Cost of Acquisition of the
Project (as defined in the Loan Agreement) , upon receipt by the
Purchaser and the Depositary of the following:
(a) A requisition and attached certificate (substan-
tially in the form of the first two paragraphs of the
"Requisition and Certificate" attached hereto and hereby
deemed incorporated herein) , signed by the Company Represen-
tative (as defined in the Loan Agreement) stating to whom the
payment described therein is to be made and the purpose, in
reasonable detail, for which the obligation to make such
payment was incurred and including, if such requisition and
certificate comprises an item for payment for labor or to
contractors, builders or materialmen, a paragraph in the form
of the last paragraph of the attached form of "Requisition
and Certificate, " appropriately completed and including
appropriate invoices;
(b) Evidence satisfactory to the Purchaser that there
are sufficient funds available to complete the Project; and
(c) Unless otherwise covered by a filing on or before
the Closing Date, evidence satisfactory to the Depositary
that the Company has filed, with respect to all financing
statements filed pertaining to the Project, an amendment
satisfying the requirements of Section 9-402 of the Uniform
9.
Commercial Code of North Carolina and adding to the
description of the Project any items of personal property not
previously included which have been or are to be acquired as
part of the Cost of Acquisition of the Project.
The Depositary shall have no duties or responsibilities
except those expressly set forth herein. The Depositary may
disregard any notice or instructions to it unless expressly
provided for herein. The Depositary may consult with its legal
counsel and shall be fully protected with respect to any action
taken or omitted by it in good faith on advice of such legal
counsel . The Depositary shall not take any action by reason of
directions by any other person, firm or corporation, except only
(i ) such notices of instructions as herein specifically provided
for, and (ii) orders or process of any court entered or issued
with competent jurisdiction. In the event that the Depositary
shall be uncertain as to its duties or rights hereunder, it shall
be entitled to refrain from taking any action until it shall be
directed otherwise in writing by the Holder, the Authority and the
Company or by an order of a court of competent jurisdiction. The
Depositary may resign as depositary hereunder by giving prior
written notice of its intention to resign to the Holder, the
Authority and the Company. Upon receipt of such notice, the
Holder shall appoint, subject to the reasonable approval of the
Authority and the Company, a successor depositary, which shall be
a national or state bank authorized to exercise corporate trust
powers, having a combined capital and surplus of at least
$50, 000, 000 and having a corporate trust office in the City of
Charlotte, North Carolina. The Depositary' s resignation shall not
be effective and it shall continue to act as depositary hereunder
(but it shall not be required to so act for more than sixty (60)
days following such resignation, whether or not a successor has
been appointed) until a successor depositary has been appointed.
Upon such appointment, the Depositary shall transfer the Project
Fund to such successor depositary, which shall then have all the
rights, obligations and immunities herein provided to the
Depositary, and the Depositary shall thereupon be released from
its duties hereunder.
The Depositary shall be entitled to rely conclusively upon
the information stated in any requisition and certificate
furnished by the Company as aforesaid, and the Depositary shall
not have any responsibility to make any inspection of the Project,
to confirm the information set forth in any such requisition and
certificate or to inquire as to the application of Bond proceeds.
The Depositary shall not be liable hereunder for any action taken
or omitted in good faith or in reliance or the advice of counsel
for any other act or omission unless the same shall have arisen
from the gross negligence or willful misconduct of the Depositary,
its officers, employees or agent.
10.
There shall be a security interest in the moneys and
investments held by the Depositary in the Project Fund for the
benefit of the Holder , upon the terms and conditions provided
herein, and this Agreement shall be deemed a security agreement
with respect to the security interest so created. The Depositary
shall be deemed to be ( 1) the secured party under G.S. 25-9-105 (m)
of the Uniform Commercial Code of North Carolina, as amended ( the
"UCC" ) , as a representative of the Holder, or ( 2)
under G.S. 25-9-305 of the UCC holds collateral for the benefit lof
the Holder as a secured party, in either case with an obligation
to use moneys in the Project Fund solely as provided herein. Upon
the occurrence of any Event of Default under the Loan Agreement,
the Holder shall have all the rights and remedies available to a
secured party under the UCC with respect to the moneys and
investments held in the Project Fund.
Any money or other assets remaining in the Project Fund at
the Completion Date (as defined in the Loan Agreement) shall be
applied by the Depositary, or paid to the Holder for application,
on behalf of the Authority, as provided in Section 11 hereof, to
the prepayment of installments of principal on the Bond in the
inverse order of maturities pursuant to its terms.
Section 10 . Investment of Project Fund and Other Mone s.
Any moneys held as any part of the Project Fund or as any special
trust funds shall, at the written direction of
the
Representative (as defined in the Loan Agreement ) , or
reinvested by the Depositary or the Holder, as the� case lmay sbe,� to
the extent permitted by law in ( i) obligations issued or
guaranteed by the United States; ( ii ) obligations issued or
guaranteed by any person controlled or supervised by and acting as
an instrumentality of the United States pursuant to authority
granted by the Congress of the United States;
agreements issued by commercial banks, including the Depositaryaor
issued by a broker, fully secured by by the United States or by an an issued or
y supervised by and acting as an instrumentality n ofo the United States pursuant to authority granted by the Congress of the United
States; ( iv) time deposits, includin
issued by commercial banks, including thet�Depositaryf and osit
foreign branches, with capital, surplus and undivided profits in
excess of $25, 000,000; (v) a money rate account of the Depositary;
(vi) commercial paper rated P-1 or P-2 by Moody ' s Investors
Service, Inc. (or an equivalent rating by
provided that the aggregate face amounts of allacommerc alopaper
of any single entity held by the Depositary or the Holder for
investment or reinvestment at any time shall not exceed
$2, 000,000; and (vii ) obligations issued by any state or its
political subdivisions the interest on which is exempt from
Federal income taxes. Any moneys held by the Holder as Payment of
11 .
the Bond (as such term is defined in the Loan Agreement ) shall be
invested or reinvested only in the investments specified in clause
( i ) above.
The investments or reinvestments so purchased shall be held
by the Depositary or the Holder, as the case may be, in trust and
shall be deemed at all times to be a part of the Project Fund or
special trust funds, as the case may be, and the interest accruing
thereon and any profit realized therefrom shall be credited to
such fund, and any losses resulting from such investment shall be
charged to such fund and reimbursed by the Company to such fund.
The Depositary shall not be liable for any loss on investments
made in accordance with this Section 10. The Depositary or the
Holder, as the case may be, are hereby directed to sell and to
reduce to cash a sufficient amount of such investments whenever
the cash balance in any such fund is insufficient to pay a
requisition and certificate when duly presented as aforesaid or to
make a payment or prepayment on the Bond when due.
The investments or reinvestments may be made by oral
instruction of the Company Representative so long as such oral
instruction is confirmed in writing to the Depositary within five
( 5) business days after oral instruction is given. In the event
the Company Representative fails to submit the written
confirmation within the prescribed five (5) business day period,
the Depository shall not be required to act thereafter on oral
instruction, and will make investments and reinvestments only upon
written instruction from the Company Representative.
Section 11. Completion of the Project. The completion of
the Project and the payment of the Cost of Acquisition of the
Project shall be evidenced by the filing with the Depositary of
the certificate of the Company Representative required by the
provisions of Section 4. 3 of the Loan Agreement. As soon as
practicable after, and in any event within 60 days from, the
Depositary ' s receipt of the certificate referred to in the
preceding sentence, any balance remaining in the Project Fund
(other than the amounts retained by the Depositary in accordance
with the provisions of Sections 4. 3 and 4.4 of the Loan Agreement)
shall, without further authorization but with advice to the Au-
thority and to the Company of such action, be applied by the
Depositary, or paid to the Holder for application, to the prepay-
ment of installments of principal on the Bond in the inverse order
of maturities in accordance with its terms.
Section 12. Alterations of Documents. Alterations and
modifications of the Bond, the Note, the Loan Agreement, this Bond
Purchase Agreement, the Security Agreement, the Deed of Trust and
the Assignment , or of any amendments or supplements hereto or
thereto, may be made only with the written consent of the Au-
12.
thority, the Company and the Holder . Alterations and modifica-
tions of the Company Guaranty, or of any amendments or supplements
thereto, may be made only with the written consent of the Company
and the Holder . Alterations and modifications of the Personal
Guaranty, or of any amendment or supplement thereto, may be made
only with the written consent of the Personal Guarantors, the
Authority and the Holder.
Section 13. Limitation of Liability of Members, etc. , of
Authority. The Authority and the members, officers, agents and
employees of the Authority shall not be liable under this Agree-
ment except as provided in Sections 11 . 12 and 11. 13 of the Loan
Agreement.
Section 14 . Execution in Counterparts. This Agreement may
be executed in several counterparts, each of which shall be an
original and all of which shall constitute but one and the same
instrument.
Section 15. Miscellaneous. (a) The Company agrees to pay
( i) the reasonable fees and expenses of counsel to the Authority,
of Bond Counsel, of counsel to the Purchaser and of counsel to the
Depositary and all other costs and expenses incidental to the
financing hereunder and the issuance of the Bond, including the
costs of producing the documents referred to herein and the fee of
the Local Government Commission of North Carolina; ( ii) all taxes,
if any, upon any documents or transactions pursuant to this Agree-
ment ; (iii ) all expenses incidental to all filings and recordings
pursuant to the Bond Documents; and ( iv) all costs of collection
( including reasonable counsel fees) in the event of default in the
payment of the principal of or interest and premium, if any, on
the Bond or other charges payable under this Agreement.
(b) This Agreement shall be binding upon and shall inure to
the benefit of the Authority, the Depositary, the Holder and the
Company and their respective successors and assigns.
(c) Upon Payment of the Bond (as defined in the Loan
Agreement) , the Authority shall be relieved of all further obliga-
tions with respect to the Bond and this Agreement, except for the
obligation to make certain payments in the event of a Determina-
tion of Taxability as more particularly provided in the Bond.
(d) Any moneys required or permitted to be paid or deposited
with the Holder under the provisions of the Loan Agreement, the
Assignment, the Security Agreement or the Deed of Trust (other
than as a payment or prepayment of amounts due pursuant to the
Note or the Loan Agreement or of the principal of or interest or
premium, if any, on the Bond or as a payment of or reimbursement
for an expense to be paid or reimbursed to the Holder by Company)
13 .
shall be held as a special trust fund by the Holder and applied to
the purpose for which such moneys were deposited, and in the
meantime such moneys may be invested and reinvested in accordance
with the provisions of Section 10 hereof.
(e) All notices, certificates or other communications
hereunder shall be sufficiently given when given as provided by
Section 11. 5 of the Loan Agreement.
(f) Notwithstanding any other provision in this Agreement to
the contrary, the following Exhibits, other than Exhibit A because
it is physically attached hereto, are hereby deemed to be attached
hereto and incorporated herein and to be parts hereof as Exhibits ,
by reference below to the Memorandum of Legal Papers dated the
Closing Time (the "Memorandum" ) , to the same extent as if each of
such Exhibits were itself physically attached to this Bond Pur-
chase Agreement as an Exhibit hereto.
Section 16. Indemnity. The Company hereby covenants and
agrees to indemnify the Purchaser and the Depositary and hold the
Purchaser and the Depositary harmless against any loss and expense
( including reasonable attorney 's fees) resulting from any and all
claims, actions, settlement or liability for acts or failure to
act in connection with the Project and the Bond Documents, except-
ing, however, any such loss or expense caused by the Purchaser ' s
or the Depositary' s gross negligence or its willful misconduct.
•
14.
LIST OF EXHIBITS
A. Form of Bond ATTACHED HERETO
B. Loan Agreement ITEM OF THE MEMORANDUM
C. Assignment ITEM OF THE MEMORANDUM
D. Security Agreement ITEM — OF THE MEMORANDUM
E. Deed of Trust ITEM — OF THE MEMORANDUM
F. Company Guaranty ITEM _ OF THE MEMORANDUM
G. Personal Guaranty ITEM — OF THE MEMORANDUM
H. Authority counsel ' s opinion ITEM __ OF THE MEMORANDUM
I . Company counsel ' s opinion ITEM OF THE MEMORANDUM
J. Bond counsel ' s opinion ITEM OF THE MEMORANDUM
(a ) This Agreement shall be governed by and construed in
accordance with the laws of the State of North Carolina.
IN WITNESS WHEREOF, the parties hereto have caused this Bond
Purchase Agreement to be executed and seals affixed and attested
by their duly authorized officers, all as of the date first above
written.
THE ORANGE COUNTY INDUSTRIAL
FACILITIES AND POLLUTION CONTROL
FINANCING AUTHORITY
By
(SEAL) Chairman
Attest:
Secretary
[Signatures of the Purchaser and the Company follow on pg. 16 . ]
15 .
NCNB NATIONAL BANK OF NORTH CAROLINA
As Purchaser
By
Vice President
Accepted
NCNB NATIONAL BANK OF NORTH CAROLINA
As Depositary
Vice President
ISOTECHNOLOGIES, INC.
Sy_
President
(SEAL)
Attest:
Secretary
16 .
No.
REOUISITION AND CERTIFICATE
, 19
NCNB National Bank of North Carolina
Charlotte, North Carolina
Sirs:
On behalf of Isotechnologies, Inc. ( the "Company" ) , I hereby from the funds representing the e
of the Industrial Revenue Bond g proceeds of the sale
issued by The Orange County Industrial Facilities and� Pollution
Control Financing Authority ( the "Authority" ) and dated as of
July 1, 1986 (the "Bond" ) , which funds are held by
Orange County Industrial Facilities and Pollu i nou Control
Financing Authority ( Isotechnologies, Inc. Project) Project Fund
in accordance with the Bond Purchase Agreement, dated as of July
1, 1986 (the "Bond Purchase Agreement" ) , among the Company, the sum of 9 you, the Authority
for $ to be paid to
I hereby certify that (a) the obligation to make such
payment was incurred by the Authority or the Company in
connection with the Acquisition (as defined in the Loan
Agreement , of even date with the Bond Purchase Agreement, between
the Authority and the Company, hereinafter referred to as the
"Loan Agreement" ) of the project (referred to in the Loan
Agreement ) , is a proper charge against the Cost of Acquisition of
the Project (as defined in the Loan Agreement) , and has not been
the basis for any prior requisition which has been paid; (b) to
the best of the Company's knowledge, neither the Authority nor
the Company is in default under any of their respective
obligations under the Loan Agreement or the Bond Purchase
Agreement nor has received written notice of any lien, right to
lien or attachment upon, or claim affecting the right of such
payee to receive payment of, any of the money payable under this
requisition to any of the persons, firms or corporations named
herein, or if any notice of any such lien, attachment or claim
has been received such lien, attachment or claim has been
released or discharged or will be released or discharged upon
payment of this requisition; (c) this requisition contains no
items representing payment on account of any retained percentages
which the Company is entitled to retain at this date; (d) the
payment of this requisition will not result in less than
substantially all of the proceeds of the Bond to be expended
under this requisition and under all prior requisitions having
been used for the acquisition and installation of property of a
character subject to the allowance for depreciation within the
meaning of Section 103 (b) ( 6) (A) of the Internal Revenue Code of
1954, as amended; ( e) with respect to all financing statements
filed pertaining to the Project, the Company has filed amendments
satisfying the requirements of Section 9-402 of the Uniform Com-
mercial Code of North Carolina adding to the description of the
Project any items of personal property which are to be acquired
as part of the Cost of Acquisition of the Project, are to be paid
for pursuant to this requisition and have not heretofore been
added to such description; and ( f) no event of default or event
which, but for the giving of notice or the lapse of time, or
both, would result in an event of default, has occurred under any
of the Bond Documents (as defined in the Loan Agreement) .
[The following paragraph is to be completed when any requisition
and certificate includes any item for payment for labor or to
contractors, builders or materialmen. ]
I hereby certify that insofar as the amount covered by the
above requisition includes payments to be made for labor or to
contractors, builders or materialmen, including [description of
materials or supplies] , in connection with the Acquisition of the
Project, (i) all obligations to make such payments have been
properly incurred, ( ii ) any such labor was actually performed and
any such materials or supplies were actually furnished or
installed in or about the Project and are a proper charge against
the Cost of Acquisition of the Project and ( iii) such materials
or supplies either are not subject to any lien or security
interest or, if the same are so subject, such lien or security
interest will be released or discharged upon payment of this
requisition.
Company Representative
2.
EXHIBIT A
$1, 500 , 000
United States of America
State of North Carolina
THE ORANGE COUNTY INDUSTRIAL FACILITIES
AND POLLUTION CONTROL FINANCING AUTHORITY
INDUSTRIAL REVENUE BOND
( ISOTECHNOLOGIES, INC. PROJECT)
THE ORANGE COUNTY INDUSTRIAL FACILITIES AND POLLUTION CON-
TROL FINANCING AUTHORITY, a political subdivision and body cor-
porate and politic of the State of North Carolina ( the "Author-
ity" ) , for value received, hereby promises to pay, but solely
from the sources hereinafter referred to, NCNB NATIONAL BANK OF
NORTH CAROLINA ( "NCNB" ) , its successors or any transferee hereof
in accordance with Section 7 of the Bond Purchase Agreement here-
inafter referred to (NCNB, its successors or such transferee
being herein called the "Holder") , in lawful money of the United
States of America, the sum of One Million Five Hundred Thousand
Dollars ( $1, 500, 000) as hereinafter provided together with inter-
est on the unpaid principal amount hereof, from the date shown in
the Certificate of Disbursement endorsed hereon until payment in
full at a variable rate per annum (except as hereinafter
provided) equal to seventy percent (70% ) of the rate of interest
publicly announced by NCNB National Bank of North Carolina as its
prime rate (the "Prime Rate) until January , 1987 and 65% of
the Prime Rate thereafter; provided, however, that such rate of
interest shall not exceed twelve and one-half percent (12. 5%) per
annum nor be less than four and one-half percent ( 4. 5% ) per
annum. Interest shall be computed on the basis of a 360-day year
for the actual number of days in each interest period. Interest
only shall be payable monthly on the unpaid principal amount of
this Bond on the first day of each month from August 1, 1986
until July 1, 1987. From and after the first day of August,
1987, interest and principal shall be payable in 108 consecutive
monthly installments, such installments to be initially $19, 500,
each installment to be applied first to interest and then to
principal; provided, however, that in no event shall any such
installment of principal and interest be less than the amount of
interest due and owing in such month. On each January 1 and July
1, commencing January 1, 1988, the monthly installments of
principal and interest shall be adjusted to be equal to an amount
sufficient to amortize on a monthly level debt service basis the
then outstanding principal balance of this bond, assuming that
the interest rate hereon until maturity is the interest rate in
effect on such January 1 or July 1 . If no prepayment of the
principal hereof is made, the final installment of principal will
become due on July 1, 1996 .
If at any time there is a Determination of Taxability (as
defined in the Loan Agreement noted below) , the interest rate
payable hereon from the Date of Taxability (as defined in the
Agreement hereinafter mentioned) shall be a rate per annum equal
to the Prime Rate plus 1% , or the maximum rate allowed by law,
whichever is lower ( the "Alternative Rate of Interest" ) , adjusted
upon each adjustment in the Prime Rate.
If the maximum incremental percentage rate of federal and
North Carolina income tax ( the "NCNB Tax Rate" ) applicable to the
taxable income of the holder of the Bond (as defined in the
Agreement noted below) decreases after the date of the Certifi-
cate of Disbursement, the applicable percentage which is applied
to the Prime Rate in determining the applicable rate of interest
hereon ( the "Tax-Exempt Factor" ) immediately prior to such change
shall be adjusted, effective on the date of such change, to equal
the product of (1) the Tax-Exempt Factor as of the date hereof
multiplied by ( 2) a fraction, (a) the numerator of which is 100%
minus the NCNB Tax Rate as so adjusted and (b) the denominator of
which is 100% minus the NCNB Tax Rate in effect on the Date of
the Certificate of Disbursement .
If the 20% percentage specified by Section 291 (a) ( 3) of the
Internal Revenue Code of 1954, as amended, or any successor pro-
vision therefor, is increased or decreased after the date of the
Certificate of Disbursement, the tax-exempt rate hereon immedia-
tely prior to such change shall be increased or decreased effec-
tive on the date of such change by 4.1 basis points for each one
percent increase or decrease, respectively, in such 20% percen-
tage.
The Authority has entered into a Bond Purchase Agreement, of
even date herewith (the "Bond Purchase Agreement" ) , with NCNB
( the "Purchaser") and Isotechnologies, Inc. , a North Carolina
corporation (the "Company" ) , providing for the issuance and sale
by the Authority, and the purchase by the Purchaser, of this Bond
upon the terms and conditions therein provided. The Bond is is-
sued pursuant to the Bond Purchase Agreement and the Industrial
and Pollution Control Facilities Financing Act, which, as amended
and codified, appears as Chapter 159C of the General Statutes of
North Carolina, for the purpose of financing the acquisition of
real property, the construction thereon of a building and the
acquisition and installation therein of machinery and equipment
( the "Project" ) to be used by the Company as a manufacturing
facility. Pursuant to a Loan Agreement of even date herewith
A-2
( the "Loan Agreement" ) , between the Authority and the Company,
the Authority has agreed to lend the proceeds of the Bond to the
Company and the Company has issued its promissory note ( the
"Note" ) , bearing interest corresponding to the interest rate on
this Bond with principal in the same amount payable on the same
date as this Bond, to the Authority in evidence of the loan.
The Bond is secured by ( i ) an Assignment, of even date here-
with ( the "Assignment" ) , by the Authority pursuant to which the
Authority has endorsed without recourse to the order of and
pledged to the Purchaser , the Note and assigned to the Holder
certain rights of the Authority under the Loan Agreement and the
Security Agreement (hereinafter defined) , ( ii) a Security Agree-
ment, of even date herewith ( the "Security Agreement" ) , from the
Company to the Authority pursuant to which the Company has
granted to the Authority a security interest in certain personal
property more fully described therein, ( iii) a Deed of Trust, of
even date herewith (the "Deed of Trust" ) , from the Company to
, as trustee for the benefit of the Authority,
relating to certain real property more fully described therein,
( iv) a Guaranty Agreement, of even date herewith (the "Company
Guaranty" ) , from the Company to the Purchaser, pursuant to which
the Company unconditionally guarantees the payment of the Bond
and (v) a Personal Guaranty Agreement of even date herewith (the
"Personal Guaranty" ) , from Mr . and Mrs. Jerome J. Richardson ( the
"Personal Guarantors") to the Purchaser, pursuant to which the
Personal Guarantors unconditionally guarantee the payment of the
Bond. Reference is hereby made to the Bond Purchase Agreement,
the Loan Agreement, the Note, the Assignment , the Security
Agreement, the Deed of Trust, the Company Guaranty and the
Personal Guaranty and to all amendments and supplements thereto
for a description of the provisions, among others, with respect
to the nature and extent of such security, the rights, duties and
obligations of the Authority and the rights of the Holder with
respect thereto.
In the event of the prepayment by the Company of all or a
portion of the unpaid balance of the payments to be made pursuant
to the Note in accordance with Section 10.1 of the Loan
Agreement, the Holder shall apply such moneys to the payment of
all or a portion, respectively, of the unpaid principal pale
on the Bond and to interest accrued thereon to the date of ypre-
payment. In the event of a prepayment in part, amounts to be
applied to the prepayment of installments of principal on the
Bond shall be applied to payments of principal in the inverse
order of their scheduled maturities.
In the event of a Determination of Taxability, the Company
is required to prepay the entire unpaid balance of the principal
of the Note, all as provided in Section 10. 2 of the Loan Agree-
A-3
Ills►
ment, and the Holder shall apply such moneys to the payment of
the entire unpaid principal amount of the Bond and interest
thereon which shall be deemed to have accrued from the Date of
Taxability at the Alternative Rate of Interest .
In the event of "cessation of operation" of the Project ( as
defined in Section 10 . 3 of the Loan Agreement ) , the Company is
required to prepay the entire unpaid balance of the principal of
the Note, all as provided in Section 10 .3 of the Loan Agreement,
and the Holder shall apply such moneys to the payment of the
entire unpaid principal amount of the Bond and interest thereon.
The Loan Agreement and the Bond Purchase Agreement provide
that the Depositary ( referred to in Section 9 of the Bond Pur-
chase Agreement) shall , within 60 days after the Completion Date
(as defined in the Loan Agreement) , apply, or pay to the Holder
for application, any balance remaining in the Project Fund under
the Bond Purchase Agreement and not required to pay the Cost of
Acquisition of the Project to reduce the principal payable on the
Bond.
All payments of interest and principal shall be made to the
Holder in funds which shall be immediately available on the due
date, by wire transfer (with written confirmation to follow) to,
or by check at, in the case of NCNB, its office in Chapel Hill,
North Carolina, wired, delivered or mailed (as the case may be)
to the attention of the Mr. Randy Dickerson; provided, however ,
that the Authority' s obligations hereunder to pay principal and
interest, and its right to prepay principal as herein provided,
shall be satisfied upon the receipt by the Holder of equivalent
amounts (i) payable pursuant to the Note, ( ii ) from the Company
pursuant to the Loan Agreement and the Assignment or the Company
Guaranty, ( iii) from the Personal Guarantors pursuant to the
Personal Guaranty, or ( iv) from the enforcement of the Security
Agreement and the Deed of Trust.
Payment of or on account of the principal of and interest--on
this Bond shall be made only to or upon the order of the Holder
regardless of any disposition of this Bond until such time as the
Authority shall have received written notice of such transfer,
including the name and address of the transferee.
THIS BOND AND THE PREMIUM, IF ANY, AND INTEREST HEREON ARE
LIMITED OBLIGATIONS OF THE AUTHORITY PAYABLE SOLELY FROM THE
REVENUES DERIVED BY THE AUTHORITY FROM THE LOAN AGREEMENT, THE
NOTE, THE SECURITY AGREEMENT AND THE DEED OF TRUST, WHICH
REVENUES HAVE BEEN ASSIGNED AND PLEDGED TO SECURE PAYMENT
THEREOF, AND FROM MONEYS DERIVED FROM THE COMPANY GUARANTY AND
THE PERSONAL GUARANTY. THIS BOND AND THE PREMIUM, IF ANY, AND
INTEREST HEREON SHALL NOT BE DEEMED TO CONSTITUTE A DEBT OR A
A-4
PLEDGE OF THE FAITH AND CREDIT OF THE STATE OF NORTH CAROLINA OR
ANY POLITICAL SUBDIVISION THEREOF, INCLUDING, WITHOUT LIMITATION,
THE AUTHORITY AND ORANGE COUNTY, NORTH CAROLINA. NEITHER THE
STATE OF NORTH CAROLINA NOR ANY POLITICAL SUBDIVISION THEREOF,
INCLUDING, WITHOUT LIMITATION, THE AUTHORITY AND ORANGE COUNTY,
NORTH CAROLINA, SHALL BE OBLIGATED TO PAY THE PRINCIPAL OF OR
PREMIUM, IF ANY, OR INTEREST ON THIS BOND OR OTHER COSTS INCIDENT
HERETO EXCEPT FROM THE REVENUES ASSIGNED AND PLEDGED THEREFOR,
AND NEITHER THE FAITH AND CREDIT NOR THE TAXING POWER OF THE
STATE OF NORTH CAROLINA OR ANY POLITICAL SUBDIVISION THEREOF, IN-
CLUDING, WITHOUT LIMITATION, THE AUTHORITY AND ORANGE COUNTY, IS
PLEDGED TO THE PAYMENT OF THE PRINCIPAL OF OR PREMIUM, IF ANY, OR
INTEREST ON THIS BOND OR OTHER COSTS INCIDENT HERETO.
Upon the occurrence and continuance of a default or an event
of default as defined in the Loan Agreement, the Holder may at
its option declare the entire principal balance and all accrued
interest thereon to be due and payable. Interest shall accrue on
any due and unpaid portion of the principal hereof or interest
hereon at a rate per annum equal to the Alternative Rate of
Interest.
Alterations and modifications of the Bond Purchase Agree-
ment, the Loan Agreement, the Note, the Assignment, the Security
Agreement and the Deed of Trust , or of any amendments or
supplements thereto, may be made only with the written consent of
the Authority, the Company and the Holder . Alterations and
modifications of the Company Guaranty, or of any amendments or
supplements thereto, may be made only with the written consent of
the Company and the Holder . Alterations and modifications of the
Personal Guaranty, or of any amendment or supplement thereto, may
be made only with the written consent of the Personal Guarantors,
the Authority and the Holder.
All acts, conditions and things required to happen, exist or
be performed precedent to and in the issuance of this Bond have
happened, exist and have been performed.
A-5
IN WITNESS WHEREOF, THE ORANGE COUNTY INDUSTRIAL FACILITIES
AND POLLUTION CONTROL FINANCING AUTHORITY has caused this Bond to
be signed by its Chairman or Vice Chairman and its official seal to
be affixed hereto and attested by its Secretary or Assistant
Secretary, all as of this 1st day of July, 1986 .
THE ORANGE COUNTY INDUSTRIAL
FACILITIES AND POLLUTION
CONTROL FINANCING AUTHORITY
(SEAL) By
Chairman
ATTEST:
Secretary
A-6
CERTIFICATE OF DISBURSEMENT
The $1, 500,000 principal amount of this Bond has been
disbursed to the Authority this th day of July, 1986, and
interest thereon accrues only from said date .
NCNB NATIONAL BANK OF NORTH CAROLINA
By
Vice President
A-7
Draft: 6/9/86
[ *�
LOAN AGREEMENT
Dated as of July 1, 1986
Between
THE ORANGE COUNTY INDUSTRIAL FACILITIES
AND
POLLUTION CONTROL FINANCING AUTHORITY
and
ISOTECHNOLOGIES, INC.
Industrial Revenue Bond
(Isotechnologies,
of
The Orange County Industrial Facilities and
Pollution Contilu �cfg �u5 0 in
the principal
RIGHTS OF THE AUTHORITY UNDER THIS INTEREST AGREEMENT FAVORBEEN
ASSIGNED DATED
NCNIGNED ON AND ARE SUBJECT A A I AS AMENDED SI SUPPLEMENTED
DATED
NCNB NATIONAL BANK OF NORTH CAROLINA UNDER AN ASSIGNMENT,
AS OF THE DATE FIRST ABOVE WRITTEN,
TIME TO TIME. INFORMATION
ONA�NB NKIOF NORTH SECURITY
CAROLINAIAT P.O.
MAY BE OBTAINED FROM NCNB NATIONAL MR. RANDY
BOX 570 , CHAPEL HILL, NORTH CAROLINA 27514,
DICKERSON.
■
r r,
TABLE OF CONTENTS
Page
' ARTICLE I
DEFINITIONS AND RULES OF CONSTRUCTION
2
Section 1 . 1 Definitions 8
Section 1 . 2 Rules of Construction
ARTICLE II
REPRESENTATIONS
P
Section 2 . 1
Representations by the Authority 9
Section 2 . 2 Representations by the Company 10
ARTICLE III
ACQUISITION OF THE PROJECT.
Section 3. 1 Agreement as to Acquisition of 12
the Project
Section 3. 2 Company to Obtain Approvals Required 12
for the Project 12
Section 3 . 3 Plans and Specifications
ARTICLE IV
ISSUANCE OF THE BOND; COMPLETION DATE
Agreement to Issue the Bond 13
Section 4. 1 9 13
Section 4 . 2 Disbursements from the Project Fund 13
Section 4 . 3 Closeout of the Project Fund
Section 4. 4 Disposition of Balance in the Project 13
Fund
Section 4. 5 Company Required to Pay in the Event 13
the Project Fund is Insufficient 14
Section 4. 6 No Third Party Beneficiary
i .
d r -
ARTICLE V
LOAN BY THE AUTHORITY TO THE COMPANY; REPAYMENT
Section 5. 1 Loan by the Authority; Repayment 15
Section 5 . 2 No Set-Off 15
Section 5. 3
Section 5. 4 Prepayments 15
Credits Against Note
ARTICLE VI 15
MAINTENANCE AND MODIFICATIONS; TAXES AND UTILITY CHARGES
Section 6 .1
Section 6 . 2
Section 7 . 1
Section 7 . 2
Section 7. 3
Section 7 . 4
Section 7 . 5
Section 7. 6
Section 7 .7
Section 7 .8
Section 7 .9
Section 7 . 10
Section 7 .11
Section 8.1
Maintenance and Modification of 16
Project by Company 16
Taxes and Utility Charges
ARTICLE VII
SPECIAL COVENANTS,
Access to the Property and Inspection 18
Company to Maintain its Corporate
18
Existence 18
Financial Statements
Further Assurances and Corrective 19
Instruments
Recording and Filing; Other 19
Instruments 29
Non-Arbitrage Covenant
Provisions Respecting Insurance and 20
Eminent Domain 23
Administrative Expenses 23
Indemnity Against Claims 23
Release and Indemnification 24
Right of Set-Off
ARTICLE VIII
ASSIGNMENT, LEASE AND SALE
Assignment of Agreement or Lease
or Sale of Project by the Company . . . . 25
Section 8. 2 Restrictions on Transfer of Authority' s 25
Rights 25
Section 8. 3 Assignment by the Authority
ii .
Page
ARTICLE IX
EVENTS OF DEFAULT AND REMEDIES
Section 9 . 1 Events of Default Defined 27
Section 9.2 Remedies on Default 28
Section 9. 3 Application of Amounts Realized
in Enforcement of Remedies 28
Section 9. 4 No Remedy Exclusive 29
Section 9. 5 Agreement to Pay Attorneys' Fees and
Expenses 29
Section 9. 6 Authority and Company to Give Notice
of Default 29
ARTICLE X
PREPAYMENTS
Section 10. 1 Optional Prepayments 30
Section 10.2 Mandatory Prepayment in Event of
Taxability 30
Section 10. 3 Mandatory Prepayment in Event of
Cessation of Operation 31
Section 10. 4 Relative Priorities 31
ARTICLE XI
MISCELLANEOUS
Section 11 . 1 References to the Bond Ineffective
After Bond Paid 32
Section 11 .2 No Implied Waiver 32
Section 11 .3 Authority Representative 32
Section 11 .4 Company Representative 32
Section 11 .5 Notices 32
Section 11 .6 If Performance Date a Legal Holiday 33
Section 11. 7 Binding Effect 33
Section 11 .8 Severability 33
Section 11 .9 Amendments, Changes and Modifications 33
Section 11. 10 Execution in Counterparts 33
Section 11. 11 Applicable Law 34
Section 11 . 12 No Charge Against Authority Credit 34
Section 11. 13 Authority Not Liable 34
Section 11 . 14 Amounts Remaining with the
Depositary or the Holder 34
iii .
t
Pane
EXHIBIT A Promissory Note A-1
EXHIBIT B Description of the Project B-1
EXHIBIT C Representations and Warranties relating
to tax matters C-1
iv.
This LOAN AGREEMENT, dated as of July 1 , 1986 , between THE
ORANGE COUNTY INDUSTRIAL FACILITIES AND POLLUTION CONTROL
FINANCING AUTHORITY, a political subdivision and body corporate
and politic of the State of North Carolina ( the "Authority" ) , and
ISOTECHNOLOGIES, INC. , a corporation duly incorporated and
existing under the laws of the State of North Carolina ( the
"Company" ) ,
I T N E S S E T H
In consideration of the respective representations and
agreements contained herein, the parties hereto, recognizing that
under the Enabling Act (hereinafter defined) this Agreement shall
not in any way obligate the State of North Carolina or any
political subdivision thereof, including, without limitation,
Orange County, North Carolina, and the Authority, to raise any
money by taxation or to use other public moneys for any purpose
in relation to the Project (hereinafter defined) and that neither
the State of North Carolina nor any political subdivision
thereof, including, without limitation, Orange County, North
Carolina, and the Authority, shall pay or promise to pay any debt
or meet any financial obligation to any person at any time in
relation to the Project, except from moneys received or to be
received under the provisions of this Agreement, the Note, the
Security Agreement, the Deed of Trust , the Company Guaranty, the
Personal Guaranty and the Bond Purchase Agreement ( each
hereinafter defined) or derived from the exercise of the rights
of the Authority thereunder , agree as follows:
4
ARTICLE I
DEFINITIONS AND RULES OF CONSTRUCTION
Section 1 . 1 . Definitions. In addition to words and terms
elsewhere defined in this Agreement the following words and terms
shall have the following meanings :
"Acquisition" , when used with reference to the Project,
means acquisition, construction and installation.
"Administrative Expenses" shall mean the amounts
payable pursuant to Section 7 .8 by the Company to or for the
account of the Authority to provide for payment of the costs
and expenses incurred by the Authority.
"Affiliate" shall mean, with respect to any person, any
other person directly or indirectly controlling or control-
led by or under direct or indirect common control with such
person. For the purposes of this definition, "control" when
used with respect to a person means the power to direct the
management and policies of such person, directly or indi-
rectly, whether through the ownership of voting securities ,
by contract or otherwise, and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"Agreement" shall mean this Loan Agreement and any
amendments and supplements hereto permitted by the Bond
Purchase Agreement .
"Alternative Rate of Interest" shall mean the Prime
Rate plus 1% , or the maximum rate permitted by law, which-
ever is lower .
"Assignment" shall mean the Assignment, of even date
herewith, from the Authority to the Holder , and any amend-
: ments and supplements thereto permitted by the Bond Purchase
Agreement.
"Authority" shall mean The Orange County Industrial
Facilities and Pollution Control Financing Authority, a
political subdivision and body corporate and politic of the
State, and its successors and assigns and any body resulting
from or surviving any consolidation or merger to which it or
its successors may be a party.
"Authority Representative" shall mean any one of the
persons at the time designated to act on behalf of the
Authority by written certificate furnished to the Company,
the Holder and the Depositary containing the specimen
2 .
signatures of such persons and signed on behalf of the
Authority by its Chairman or Vice Chairman .
"Bond" shall mean The Orange County Industrial
Facilities and Pollution Control Financing Authority
Industrial Revenue Bond ( Isotechnologies, Inc. Project ) ,
authorized to be issued pursuant to a resolution of the
Authority in accordance with the Bond Purchase Agreement in
the principal amount of $1 , 500, 000 .
"Bond Documents" shall mean, collectively, the Bond
Purchase Agreement, the Bond, this Agreement , the Note, the
Assignment, the Security Agreement, the Deed of Trust, the
Company Guaranty and the Personal Guaranty.
"Bond proceeds" shall mean the principal of the Bond
and any investment earnings thereon while on deposit in the
Project Fund.
"Bond Purchase Agreement" shall mean the Bond Purchase
Agreement, of even date herewith, by and among the Autho-
rity, the Company and the Purchaser, and any amendments and
supplements thereto permitted thereby.
"Code" shall mean the Internal Revenue Code of 1954, as
amended.
"Company" shall mean Isotechnologies, Inc. , a cor-
poration incorporated and existing under the laws of the
State, and its successors and assigns and any surviving,
resulting or transferee corporation or other entity.
"Company Guaranty" shall mean the Guaranty Agreement,
of even date herewith, from the Company to the Purchaser ,
together with any amendments and supplements thereto
permitted thereby.
"Company Representative" shall mean any one of the
persons at the time designated to act on behalf of the
Company by written certificate furnished to the Authority,
the Holder and the Depositary containing the specimen
signatures of such persons and signed on behalf of the
Company by the President or any Vice President of the
Company.
"Completion Date" shall mean that date certified as
provided in Section 4 .3.
"Cost of Acquisition of the Project" shall mean all
costs and allowances which the Authority or the Company may
3.
r .
r y
properly pay or accrue for the Acquisition of the Project
and which under generally accepted accounting principles are
chargeable to the capital account of the Project or could be
so charged either with a proper election to capitalize such
costs or but for a proper election to expense such costs,
including, without limitation, the following:
( 1) The Project ; preparation of the Plans and
Specifications for the Project ( including any pre-
liminary study or planning or any aspect thereof) ; any
labor, services, materials and supplies used or
furnished in site improvement and the acquisition
necessary to provide utility services or other services
including trackage to provide the Project with public
transportation facilities, roadways, parking lots ,
water supply, sewage and waste disposal facilities, and
all real and tangible personal property deemed neces-
sary by the Company in connection with the Project;
( 2) The fees for architectural , engineering,
supervisory and consulting services;
( 3 ) Any fees and expenses in connection with the
acquisition, perfection and protection of title to the
Project and any fees and expenses incurred in connec-
tion with the preparation, recording or filing of such
documents, instruments or financing statements as
either the Company or the Authority may deem desirable
to perfect or protect the rights of the Authority and
the Holder under the Bond Documents;
( 4) The legal , accounting and financial advisory
fees and expenses, filing fees, and printing and
engraving costs incurred in connection with the
authorization, issuance, sale and purchase of the Bond,
and the preparation of the Bond Documents and all other
documents in connection with the authorization,
issuance and sale of the Bond;
( 5) Interest to accrue on the Bond during
Acquisition of the Project;
( 6) Any administrative or other fees charged by
the Authority, the Department of Commerce of the State
or the Local Government Commission of the State, or
reimbursement thereto of expenses, in connection with
the Project to the Completion Date; and
( 7) Any other costs and expenses relating to the
Project which would constitute costs or expenses for
4 .
which the Authority may expend Bond proceeds under the
Enabling Act .
"Counsel" shall mean an attorney or a firm of attorneys
acceptable to the Holder and may, but need not , be counsel
to the Authority or the Company.
"County" shall mean Orange County, North Carolina.
"Date of Taxability" shall mean the first date on which
interest on the Bond became includable in the gross income
of the Holder or a former Holder pursuant to a Determination
of Taxability.
"Deed of Trust" shall mean the Deed of Trust, of even
date herewith, from the Company to , as trustee
for the benefit of the Authority, and any amendments and
supplements thereto permitted by the Bond Purchase
Agreement.
"default" or "event of default" shall have the meaning
set forth in Section 9 .1.
"Depositary" shall mean NCNB National Bank of North
Carolina, a national banking association with its principal
office in Charlotte, North Carolina, in its capacity as
custodian of the Project Fund.
"Determination of Taxability" shall be defined as and
shall be deemed to have occurred on the first to occur of
the following;
(a) on that date when the Company files ( in
compliance with its obligations under this Agreement )
any statement, supplemental statement or other tax
schedule, return or document (whether pursuant to
Treasury Regulations §1.103--10 (b) ( 2) (vi) , as the same
may be amended or supplemented, or otherwise) which
discloses that an "Event of Taxability, " as hereinafter
defined, shall have in fact occurred (a "Supplemental
Statement" ) ;
(b) on the date when the Holder or any prior
Holder notifies the Company that it has received a
written opinion by an attorney or firm of attorneys of
recognized standing on the subject of municipal bonds
to the effect that an Event of Taxability shall have
occurred;
5 .
rt
(c) on the date when the Company shall be advised
in writing by the Commissioner or any District Director
of Internal Revenue that , based upon filings of the
Company, or upon any other ground whatsoever , an Event
of Taxability shall have occurred;
(d) on that date when the Company shall receive
notice from the Holder or any prior Holder that ( i ) the
Internal Revenue Service has assessed as includable in
the gross income of such Holder the interest on the
Bond due to the occurrence of an Event of Taxability,
or ( ii ) such Holder has been advised by the Commis-
sioner or any District Director of the Internal Revenue
Service that the interest on the Bond is includable in
the gross income of any Holder of the Bond due to the
occurrence of an Event of Taxability;
provided, however , no Determination of Taxability shall
occur under subparagraph ( c) or (d) hereof unless the
Company has been afforded the opportunity, at its expense,
to contest any such assessment and, further , no Deter-
mination of Taxability shall occur until such contest , if
made, has been finally determined.
"Eminent Domain" shall mean the taking of title to, or
the temporary use of, the Project or any part thereof
pursuant to eminent domain or condemnation proceedings, or
by any settlement or compromise of such proceedings, or any
voluntary conveyance of the Project or any part thereof
during the pendency of, or as a result of a threat of, such
proceedings.
"Enabling Act" shall mean Chapter 800 of the 1975
Session Laws of North Carolina, as amended, which as
codified appears as Chapter 159C of the General Statutes of
North Carolina.
"Event of Taxability" shall mean a change in law or
fact or the interpretation thereof, or the occurrence or
existence of any fact, event or circumstance ( including,
without limitation, the existence of obligations or the
incurring of capital expenditures in excess of those
permitted by Section 103(b) (6) (D) of the Code) , or the
taking of any action by the Company, or the failure to take
any action, or the making by the Company of any misrepre-
sentation herein or in any certificate required to be given
in connection with the issuance, sale or delivery of the
Bond, which has the effect of causing the interest payable
on the Bond to become includable in the gross income of the
Holder or any prior Holder of the Bond (other than a Holder
6 .
who is a "substantial user" or "related person" as such
terms are used in Section 103 ( b) of the Code) .
"Holder" shall mean the Purchaser and any transferees
of the Bond in accordance with Section 7 of the Bond
Purchase Agreement .
"Net Proceeds" when used with respect to any proceeds
of insurance or proceeds resulting from Eminent Domain shall
mean the gross proceeds therefrom less all expenses ( includ-
ing attorneys ' fees) incurred in realization thereof.
"Note" shall mean the promissory note given by the
Company pursuant to Section 5.1, substantially in the form
of Exhibit A attached hereto.
"Payment of the Bond" shall mean payment of ( i) the
principal of and interest on the Bond in accordance with its
terms whether through payment at maturity or prepayment, or
provision for such payment having been made, and ( ii) all
amounts due as Administrative Expenses or otherwise; in any
case, in such a manner that the Bond shall have been paid.
"Permitted Encumbrances" shall mean as of the date of
delivery of the Bond, the Security Agreement, the Deed of
Trust and the Assignment, all exceptions listed on the title
insurance policy delivered pursuant to Section 7. 7 , and
thereafter also all ( i) liens for ad valorem taxes and
special assessments, if any, not then delinquent , ( ii )
utility, access and other easements and rights of way,
restrictions and exceptions that an officer of the Company
certifies will not interfere with or impair the operations
being conducted at the Project (or, if no operations are
being conducted at the Project , the operations for which the
Project was designed or last modified) and to which the
Holder has consented, ( iii ) mechanics ' , materialmen' s,
warehousemen' s, carriers ' and other similar liens which in
the opinion of the Authority and the Holder, supported by an
opinion of Counsel to the Company, do not materially
endanger the respective liens of the Security Agreement, the
Deed of Trust and the Assignment upon the Project, and ( iv)
such minor defects, irregularities, encumbrances and clouds
on title as normally exist and as exist on the dates of
acquisition by the Company with respect to properties
similar in character to the Project and as do not, in the
opinion of the Holder and of an officer of the Company,
materially impair the property affected thereby for the
purposes for which it is used or to be used by the Company.
7.
"Personal Guarantors" shall mean Mr . Jerome J .
Richardson and Mrs. Rosalind S. Richardson, their heirs and
assigns .
"Personal Guaranty" shall mean the Guaranty Agreement ,
of even date herewith, from the Personal Guarantors to the
Holder , together with any amendments and supplements thereto
permitted by the Bond Purchase Agreement .
"Plans and Specifications" shall mean the plans and
specifications used in the Acquisition of the Project , as
the same may be revised from time to time by the Company in
accordance with Section 3 . 3.
"Prime Rate" shall mean the rate of interest per annum
equal to the rate of interest publicly announced by NCNB
National Bank of North Carolina as its prime rate, such rate
to be adjusted daily to conform to the prime rate in effect
on each day.
"Project" shall mean, collectively, the property
described in Exhibit B hereto, as the same may at any time
exist.
"Project Fund" shall mean the fund created pursuant to
Section 9 of the Bond Purchase Agreement .
"Purchaser" shall mean NCNB National Bank of North
Carolina, a national banking association with its principal
office in Charlotte, North Carolina, in its capacity as the
original purchaser of the Bond pursuant to the Bond Purchase
Agreement, and its successors.
"Security Agreement" shall mean the Security Agreement,
of even date herewith, between the Company and the
Authority, and any amendments and supplements thereto
permitted by the Bond Purchase Agreement.
"State" shall mean the State of North Carolina.
"Tax Regulations" shall mean the applicable regulations
under Section 103 of the Code whether at the time proposed,
temporary, final or otherwise.
Section 1. 2. Rules of Construction.
(a) Words of the masculine gender shall be deemed and
construed to include correlative words of the feminine and
neuter genders, and words of the neuter gender shall be
8.
deemed and construed to include correlative words of the
masculine and feminine genders .
( b) Unless the context shall otherwise indicate, the
word "person" shall include the plural as well as the
singular number, and "person" shall mean any individual ,
corporation, partnership, joint venture, association ,
joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof .
(c) The captions or headings in this Agreement are for
convenience only and in no way define, limit or describe the
scope or intent of any provisions or sections of this
Agreement .
(d) All references herein to particular articles or
sections are references to articles or sections of this
Agreement unless some other reference is established.
9 .
ARTICLE II
REPRESENTATIONS
Section 2 . 1 . Representations by the Authority. The
Authority represents and warrants as follows :
(a) The Authority is a duly constituted political
subdivision and body corporate and politic of the State
established under the Enabling Act.
(b) Under the provisions of the Enabling Act, the
Authority is duly authorized to enter into, execute and
deliver the Bond Documents to which it is a party, to
undertake the transactions contemplated by the Bond
Documents to which it is a party, and to carry out its
obligations hereunder and thereunder .
(c) The Authority proposes to issue its Bond in the
principal amount of $1, 500,000 to finance all or a portion
of the Cost of Acquisition of the Project , presently
estimated by the Company to equal or exceed $1, 500, 000 .
(d) By duly adopted resolution, the Authority has duly
authorized the execution and delivery of the Bond Documents
to which it is a party and (as security for the Bond) the
endorsement and pledge of the Note, as endorsed without
recourse to the order of the Purchaser, to the Purchaser ,
all for the purpose of fostering and encouraging the
development of industrial facilities
order to alleviate unemployment and raise twages tprevalent in
the County.
(e) The Bond will be issued under and pursuant to the
Bond Purchase Agreement and will mature, bear interest, and
have the other terms and provisions set forth in the Bond
Purchase Agreement.
(f) The Authority has obtained from the Board of
Commissioners for the County approval of the issuance G1, the
Bond required by Section 159C-4(d) of the nabling Act, from
the Secretary of the Department of Commerce of the State
approval of the Project required by Section 159C-7 of the
Enabling Act and from the Local Government Commission of the
State the approvals required by Sections 159C-6, 8 and 9 of
the Enabling Act.
(g) The execution and delivery of and performance
under the Bond Documents to which the Authority is a party
10 .
will not conflict with, or constitute a breach of or default
under, or require any consent pursuant to, any law or regu-
lations presently applicable to the Authority ( except for
such consents and approvals as have heretofore been obtain-
ed) , the by-laws of the Authority, any order of any court ,
regulatory body or arbitral tribune or any agreement or
instrument to which the Authority is a party or by which it
is bound.
(h) To best of the Authority ' s knowledge, there are no
judicial, regulatory or arbitral proceedings pending or
threatened against the Authority which, if decided adversely
to the Authority, would have a material adverse effect on
the issuance and sale of the Bond or any of the transactions
of the Authority in connection therewith.
( i ) When duly executed and delivered on behalf of the
Authority, and assuming the due authorization, execution and
delivery by the other parties thereto, the Bond Documents to
which the Authority is a party shall constitute valid and
binding limited obligations of the Authority in accordance
with their terms.
Section 2. 2. Representations by the Company. The Company
represents and warrants as follows:
(a) The Company is a corporation validly incorporated
and existing and in good standing under the laws of the
State, has corporate and other legal authority to enter
into, and to perform the agreements and covenants on its
part contained in the Bond Documents to which it is a party,
and has duly authorized the execution, delivery and per-
formance of the Bond Documents to which it is a party.
(b) The execution and delivery of the Bond Documents
to which it is a party, consummation of the transactions
contemplated hereby and thereby, and the fulfillment of or
compliance with the terms and conditions hereof and thereof
will not conflict with or constitute a breach of or a
default under any agreement or instrument to which the
Company is a party or any existing law, administrative
regulation, court order or consent decree to which the
Company is subject, or by which it or any of its property is
bound. Each of the Bond Documents to which the Company is a
party is enforceable against the Company in accordance with
its terms.
(c) The Project described in Exhibit B hereto is
substantially the same in all material respects to that
described in the Authority 's application to the Department
11.
of Commerce of the State pursuant to G. S . 1590-7 of the
Enabling Act .
(d) The Company will cause the Bond proceeds to be
applied to the payment of Costs of Acquisition of the
Project .
(e) The Company presently expects to operate the
Project as a manufacturing facility from the Completion Date
until Payment of the Bond.
( f) At the Completion Date, the Project will be a
"project" within the meaning of the Enabling Act .
(g) The Company presently in good faith estimates the
Cost of Acquisition of the Project to equal or exceed the
amount of Bond proceeds.
(h) The Project will be located wholly within the
County.
( i ) The representations and warranties contained in
Exhibit C hereto are true and correct
( j ) The site of the Project is
J properly zoned and the
intended use and operation of the Project complies with the
usage permitted by applicable zoning regulations.
(k) No approval, or authorization of or registrations,
declaration or filing with any government or public body or
authority is required in connection with the valid execu-
tion, delivery and performance by the Company of the Bond
Documents to which the Company is a party which has not
heretofore been obtained.
12 .
ARTICLE III
ACQUISITION OF THE PROJECT
Section 3. 1 . Agreement as to Acquisition of the Project.
The Authority and the Company hereby agree that the Company shall
complete the Acquisition of the Project with all reasonable
dispatch, delays incident to strikes, riots, acts of God or the
public enemy or any delay beyond its reasonable control only
excepted, in accordance with the Plans and Specifications ;
provided, however , that if completion of such Acquisition is
delayed for any reason, there shall be no diminution in or
postponement of the payments to be made by the Company pursuant
to the Note.
Section 3 . 2. Company to Obtain Approvals Required for the
Project. The Company shall obtain all necessary permits and
approvals for the Acquisition, operation and maintenance of the
Project and shall comply with all lawful requirements of any
governmental body regarding the use or condition of the Project.
The Company may, however, contest any such requirement in good
faith by an appropriate proceeding diligently prosecuted.
Section 3. 3. Plans and Specifications. The Company shall
maintain a set of Plans and Specifications at the Project which
shall be available to the Authority and the Holder for inspection
and examination during the Company 's regular business hours, and
the Authority, the Holder and the Company agree that the Company
may supplement, amend and add to the Plans and Specifications,
and that the Company shall be authorized to omit or make sub-
stitutions for components of the Project, without the approval of
the Authority and the Holder, provided that no such change shall
be made which shall be contrary to (1) subsections (c) , (d) , (f)
or (h) of Section 2.2, or (2) any of the representations and
warranties set forth in Exhibit C hereto, and provided further
that if any such change would render materially incorrect or
inaccurate the description of the initial components of the
Project as set forth in Exhibit B to this Agreement, the Company,
the Holder and the Authority shall amend such Exhibit B to
reflect such change, and the Company shall cause to be furnished
to the Authority and the Holder an opinion of bond counsel that
such change will not cause interest on the Bond to be subject to
federal income tax. No approvals of the Authority and the Holder
shall be required for the Acquisition of the Project or for the
solicitation, negotiation, award or execution of contracts
relating thereto.
13.
ARTICLE IV
ISSUANCE OF THE BOND; COMPLETION DATE
Section 4.1. Agreement to Issue the Bond. (a) To provide
funds for payment of the Cost of Acquisition of the Project, the
Authority agrees that it will sell, issue and deliver the Bond in
the principal amount of $1,500,000 to the Purchaser thereof and
will cause the Bond proceeds to be applied as provided in Section
9 of the Bond Purchase Agreement.
(b) In connection with the issuance of the Bond, in
accordance with Section 103(b) ( 6) (D) of the Code and Section
1.103-10(b) (2) (vi ) of the Tax Regulations, the Authority,
pursuant to the authority contained in a resolution adopted by
its Board of Commissioners, hereby elects to have the provisions
of Section 103(b) (6) (D) of the Code apply to the Bond.
Section 4.2. Disbursements from the Project Fund. All
payments from the Project Fund to pay the Cost of Acquisition of
the Project, or to reimburse the Company for any Cost of Acqui-
sition of the Project paid or incurred by the Company before or
after the execution and delivery of this Agreement and the
issuance and delivery of the Bond and after December 6, 1985 with
respect to at least $1, 250,000 of Costs and after February 25 ,
1986 with respect to at least $250,000 of Costs, shall be made by
the Depositary pursuant to the Bond Purchase Agreement upon
receipt of a requisition complying with the provisions of Section
9 of the Bond Purchase Agreement.
Section 4. 3 . Closeout of the Project Fund. The Completion
Date shall be the date on which there is delivered to the
Depositary and the Holder a certificate by a Company Representa-
tive stating that, except for amounts retained by the Depositary
at the Company's direction for any Cost of Acquisition of the
Project not then due and payable, the Acquisition of the Project
has been completed substantially in accordance with the Plans and
Specifications and all costs and expenses incurred in connection
therewith have been paid. Notwithstanding the foregoing, such
certificate shall state that it is given without prejudice to any
rights against third parties that exist at the date of such
certificate or that may subsequently come into being.
Section 4.4. Disposition of Balance in the Project Fund.
Pursuant to Section 11 of the Bond Purchase Agreement, as soon as
practicable after, and in any event within 60 days from, the
Depositary' s receipt of the certificate mentioned in Section 4 .3,
all amounts remaining in the Project Fund, including any
14.
unliquidated investments made with money theretofore deposited in
the Project Fund, except for amounts to be retained in the
Project Fund for any Cost of Acquisition of the Project not then
due and payable as provided in Section 4 . 3, shall be applied to
the prepayment of installments of principal of the Bond in the
inverse order of maturities in accordance with the terms of the
Bond Purchase Agreement.
Section 4 . 5 . Company Required to Pay in the Event the
Project Fund is Insufficient. In the event the moneys in the
Project Fund should not be sufficient to pay the total cost of
the Project in full, the Company agrees to complete the Project
and to pay that portion of such cost in excess of the moneys
available therefor in the Project Fund. THE AUTHORITY MAKES NO
WARRANTY, EITHER EXPRESS OR IMPLIED, THAT THE MONEYS PAID INTO
THE PROJECT FUND AND AVAILABLE FOR PAYMENT OF THE COST OF
ACQUISITION OF THE PROJECT WILL BE SUFFICIENT TO PAY THE TOTAL
COST OF ACQUISITION OF THE PROJECT. The Company agrees that if ,
after exhaustion of the moneys in the Project Fund, the Company
should pay any portion of the total cost of the Project pursuant
to the provisions of this Section, it shall not be entitled to
any reimbursement therefor from the Authority or the Holder and
it shall not be entitled to any abatement or diminution of the
payments required to be made by the Company pursuant to the Note .
Section 4.6. No Third Party Beneficiary. It is specif-
ically agreed between the parties executing this Agreement that
it is not intended by any of the provisions of any part of this
Agreement to establish in favor of the public or any member
thereof, other than as expressly provided herein or as contem-
plated in the Assignment, the rights of a third party beneficiary
hereunder, or to authorize anyone not a party to this Agreement
to maintain a suit for personal injuries or property damage
pursuant to the terms or provisions of this Agreement. The
duties, obligations and responsibilities of the parties to this
Agreement with respect to third parties shall remain as imposed
by law.
15 .
ARTICLE V
LOAN BY THE AUTHORITY TO THE COMPANY; REPAYMENT
Section 5 . 1 . Loan by the Authority; Repayment. Upon the
terms and conditions of this Agreement, the Authority shall lend
to the Company the proceeds of the sale of the Bond. The loan
shall be evidenced by the Note. The loan shall be made by
depositing said proceeds in the Project Fund in accordance with
Section 9 of the Bond Purchase Agreement.
As consideration for the issuance of the Bond and the making
of the loan to the Company by the Authority, the Company will
execute and deliver the Note, in the form attached as Exhibit A
hereto, and the Authority will endorse the Note without recourse
to the order of and pledge the Note to the Purchaser, as the
assignee of the Authority under the Assignment, contemporaneously
with the issuance of the Bond. The Company will repay the loan
in accordance with the provisions of the Note and of this
Agreement.
Section 5. 2. No Set-Off. The obligation of the Company to
make the payments required by the Note shall be absolute and
unconditional. The Company will pay without abatement, diminu-
tion or deduction (whether for taxes or otherwise) all such
amounts regardless of any cause or circumstance whatsoever
including, without limitation, any defense, set-off, recoupment
or counterclaim that the Company may have or assert against the
Authority, the Holder or any other person.
Section 5. 3. Prepayments. The Company may prepay all or
any part of the amount the Note obligates it to pay as provided
in Section 10. 1 and shall prepay all of the amount the Note
obligates it to pay as provided in Sections 10. 2 and 10. 3 .
Section 5. 4 . Credits Against Note. To the extent that
principal of or premium, if any, or interest on the Bond shall be
paid, there shall be credited against the unpaid principal of or
premium or interest on the Note, an amount equal to the principal
of or premium, if any, or interest on the Bond so paid. If the
principal of and premium, if any, and interest on the Bond shall
have been paid sufficiently that Payment of the Bond shall have
occurred, then the Note, ipso facto, shall be deemed to have been
paid in full, the Company's obligations thereon shall be dis-
charged, and the Note shall be cancelled and surrendered to the
Company, except that the obligation of the Company to make
certain payments upon occurrence of a Determination of Taxability
shall survive notwithstanding payment of the Bond.
16.
ARTICLE VI
MAINTENANCE AND MODIFICATIONS;
TAXES AND UTILITY CHARGES
Section 6 . 1 . Maintenance and Modification of Project by
Company. The Company agrees that until Payment of the Bond shall
be made it will at its own expense ( i ) keep the Project in as
reasonably safe condition as its operations shall permit and ( ii )
make from time to time all necessary repairs to the Project and
renewals and replacements thereof and otherwise keep the Project
in good repair and in good operating condition. The Company will
pay all costs and expenses of operation of the Project .
The Company may, also at its own expense, make from time to
time any additions, modifications or improvements to the Project
that it may deem desirable for its business purposes and that do
not materially impair the effective use, nor materially decrease
the value, of the Project .
Additional equipment and other facilities ( i ) which are not
described in Exhibit B as part of the Project and are not
financed from the Bond proceeds or ( ii ) which do not constitute
an integral part of the Project referred to in clause ( i ) of this
paragraph shall not become part of the Project by virtue of their
location on the site of the Project or their affixation to a part
of the Project or their use in connection with the Project .
Section 6 . 2. Taxes and Utility Charges. (a) Recognizing
that Article V, §9 of the Constitution of North Carolina provides
as -to projects to be financed under the Enabling Act, such as the
Project, in effect that the Project and all transactions therefor
shall be subject to taxation to the extent the Project and such
transactions would be subject to taxation if the Authority were
not involved therewith, the Company shall pay, as the same
respectively become due, all taxes, assessments and charges of
any kind whatsoever that may at any time be lawfully assessed or
levied against or with respect to the Project ( including, without
limiting the generality of the foregoing, any tax upon or with
respect to the income or profits of the Authority from the
Project and that, if not paid, would become a charge on the
payments to be made under this Agreement or the Note prior to or
on a parity with the charge thereon created by the Assignment and
including ad valorem, sales and excise taxes, assessments and
charges upon the Company 's interest in the Project) , all utility
and other charges incurred in the operation, maintenance, use,
occupancy and upkeep of the Project and all assessments and
charges lawfully made by any governmental body for public
improvements that may be secured by lien on the Project .
17 .
(b) Upon delivery of an opinion of Counsel to the effect
that, by non-payment of any levy, tax, assessment or other
charge, the lien of the Security Agreement as assigned under the
Assignment or any part of the payments to be made under this
Agreement or the Note will not be materially endangered and that
the Project or any part thereof will not be subject to loss or
forfeiture, the Company may, at its expense and upon notice to
the Authority and the Holder , contest in good faith any such
levy, tax, assessment or other charge and in such event may
permit the items so contested to remain undischarged and
unsatisfied during the period of such contest and any appeal
therefrom. In the absence of such an opinion, the Company shall
promptly pay or bond and cause to be satisfied or discharged all
such unpaid items or furnish, at the expense of the Company,
indemnity satisfactory to the Holder . The Authority, at the
expense of the Company, will cooperate fully in any such contest .
(c) The Company shall furnish the Authority and the Holder,
upon request, with proof of payment of any taxes, governmental
charges, utility charges, insurance premiums or other charges
required to be paid by the Company under this Agreement .
(d) The Company hereby authorizes the Authority and the
Holder to make any payment required to be made by this Section,
and any sums so advanced shall attach to and become part of the
debt secured hereby, shall become payable at any time on demand
therefor and, from the date of the advance to the date of
repayment , any sum so advanced shall bear interest at a rate per
annum equal to the Alternative Rate of Interest .
18 .
ARTICLE VII
SPECIAL COVENANTS
Section 7 . 1 . Access to the Property and Inspection. The
Authority Representative and the Holder shall have the right, at
all reasonable times upon the furnishing of reasonable notice to
the Company under the circumstances, to enter upon and examine
and inspect the Project. The Company hereby covenants to
execute, acknowledge and deliver all such further documents ,
including any deed of easement, and to do all such other acts and
things as may be necessary to grant to the Authority Represen-
tative and to the Holder such right of entry. The Authority
Representative and the Holder shall also be permitted, at all
reasonable times, to examine the books and records of the Company
with respect to the Acquisition of the Project and the obliga-
tions of the Company hereunder, but neither shall be entitled to
access to trade secrets or to other proprietary information of
the Company.
Section 7.2. Company to Maintain its Corporate Existence.
The Company agrees that it will maintain its corporate existence,
will not dissolve or otherwise dispose of all or substantially
all of its assets and will not consolidate with or merge into
another corporation or permit one or more other corporations to
consolidate with or merge into it, unless the Holder and the
Authority shall otherwise consent in writing; provided, that the
Company may, without violating its agreement contained in this
Section, permit one or more corporations to consolidate with or
merge into it, provided the resulting corporation is the Company
and that such consolidation or merger will not violate any
provision of the Bond Documents.
Section 7. 3 . Financial Statements. (a) Until Payment of
the Bond shall have occurred, the Company shall deliver to the
Holder and the Authority ( i) within 45 days of the close of each
of the first three quarters of each fiscal year of the Company, a
financial statement relating to the quarter so closed (which
financial statement may be unaudited) , and (ii) within 120 days
of the close of each fiscal year of the Company, a financial
statement relating to the fiscal year so closed, together with a
balance sheet and profit-and-loss statement, with an audited and
unqualified opinion of an independent certified public accounting
firm of independent certified public accountants satisfactory to
the Holder. All financial statements furnished pursuant hereto
shall be prepared in accordance with generally accepted
accounting principles, consistently applied.
19 .
( b) In addition, the Company shall provide to the Holder
( i ) together with each of the statements referred to in paragraph
(a ) of this Section 7 . 3 , a certificate of a chief financial
officer of the Company satisfactory to the Holder that the
Company is in compliance with the provisions of each of the Bond
Documents to which it is a party, and ( ii ) such other information
with regard to the Company' s operations, financial condition and
affairs as the Holder may reasonably request . An officer or
director of the Company shall deliver to the Holder and the
Authority forthwith, upon obtaining knowledge of an Event of
Default hereunder or under any of the Bond Documents, or any
event which would constitute such an Event of Default but for the
requirement that notice be given or time elapse or both, a
certificate of the Company specifying the nature and period of
existence thereof and what action the Company proposes to take
with respect thereto.
(c) The Company shall deliver on or prior to July 1 of each
year to the Authority and the Local Government Commission of the
State a certificate stating the principal amount of the Bond
outstanding as of June 30 of the same year and the Holder of the
Bond as of such July 1.
Section 7.4. Further Assurances and Corrective Instruments.
Subject to the provisions of the Bond Purchase Agreement, the
Authority and the Company agree that they will , from time to
time, execute, acknowledge and deliver, or cause to be executed,
acknowledged and delivered, such supplements and amendments
hereto and such further instruments as may reasonably be required
for correcting any inadequate or incorrect description of the
Project and for carrying out the intention or facilitating the
performance of this Agreement.
Section 7 . 5. Recording and Filing; Other Instruments.
(a) The Company covenants that it will cause Counsel to render
an opinion to the Authority and to the Holder not earlier than 60
nor later than 30 days prior to each anniversary date occurring
at five-year intervals after the issuance of the Bond to the
effect that all financing statements, continuation statements,
notices and other instruments required by applicable law have
been recorded or filed or re-recorded or re-filed in such manner
and in such places required by law in order fully to preserve and
to protect the rights of the Holder in the assignment of certain
rights of the Authority under this Agreement, the Security
Agreement and otherwise under the Assignment and in the endorse-
ment and pledge of the Note as against creditors of, or pur-
chasers for value from, the Authority or the Company.
(b) The Company and the Authority shall execute and deliver
all instruments and shall furnish all information and evidence
20.
deemed necessary or advisable by such Counsel to enable such
Counsel to render the opinion referred to in subsection (a ) of
this Section. The Company shall file and re-file and record and
re-record or shall cause to be filed and re-filed and recorded
and re-recorded all instruments required to be filed and re-filed
and recorded or re-recorded pursuant to the opinion of such
Counsel and shall continue or cause to be continued the liens of
such instruments for so long as the Bond shall be outstanding,
except as otherwise in this Agreement required.
Section 7 .6. Non-Arbitrage Covenant. The Company and the
Authority each covenant and agree that they will ( i ) not take any
action or make any investment or use of the Bond proceeds which
would cause the Bond to be an "arbitrage bond" within the meaning
of Section 103(c) of the Code and the Tax Regulations as the same
may be applicable to the Bond at the time of such action,
investment or use, and ( ii ) comply with the requirements of
Section 103 (c) (6) of the Code and the Tax Regulations promulgated
thereunder . Further, the Company and the Authority will take all
action necessary to insure that the Bond does not become an
arbitrage bond, including without limitation, taking all
reasonable steps to insure compliance with yield limitations on
investment of Bond proceeds and the rebate requirements for
certain amounts earned on Bond proceeds.
Section 7 .7 . Provisions Respecting Insurance and Eminent
Domain. (a) Each insurance policy obtained in satisfaction of
the requirements of this Section:
( i ) shall be by such insurer (or insurers) as shall
be financially responsible, qualified to do business in the
State, and of recognized standing;
( ii ) shall be in such form and have such provisions
(including, without limitation, the long-form loss payable
clause, the waiver of subrogation clause, the deductible
amounts or self-insurance and the standard mortgagee
endorsement clause) , as are generally considered standard
provisions for the type of insurance involved;
( iii) except in the case of title insurance, which
shall be noncancellable, shall prohibit cancellation or
substantial modification by the insurer without at least 30
days ' prior written notice and opportunity to renew or cure
any default given to the Authority and the Holder;
( iv) shall provide that losses thereunder shall be
adjusted with the insurer by the Company at its expense on
behalf of the insured parties and the decision of the
21 .
Company as to any adjustment shall be final and conclusive ;
and
( v) without limiting the generality of the
foregoing, all insurance policies carried on the Project
shall name the Company, the Authority and the Holder as
parties insured thereunder as the respective interests of
each of such parties may appear (or as loss payees) , and any
loss thereunder shall be made payable and shall be applied
as provided in subsection (e) hereof.
Prior to expiration of any such policy, the Company shall
furnish the Holder with evidence satisfactory to the Holder that
the policy or certificate has been renewed or replaced or is no
longer required by this Agreement .
(b) Until Payment of the Bond, the Company will keep the
Project continuously insured against such risks as are customa-
rily insured against by businesses of like size and type includ-
ing:
( i) property insurance to the full insurable cash
value of the structures and equipment constituting the
Project against loss or damage by fire and lightning and
other hazards ordinarily included under uniform standard
extended coverage policies limited only as may be provided
in the standard form of extended coverage endorsement at the
time in use in the State;
( ii ) general public liability insurance against (A)
claims for bodily injury, death or property damage occurring
on, in or about the Project (such coverage to include
provisions waiving subrogation against the Authority) in
amounts not less than $500, 000 per occurrence with respect
to bodily injury to any one or more persons and $250, 000 per
occurrence with respect to property damage, and (B) liabil-
ity with respect to the Project under the worker ' s compen-
, sation laws of the State;
(iii ) business interruption insurance with coverage
equal to the maximum debt service on the Bond for any one-
year period; and
( iv) title insurance on the real estate included in the
Project in the form of a mortgagee title policy ( including,
if available, mechanics ' lien coverage) in an amount of
$1, 500,000 insuring the interests of the Authority and the
Holder under the Deed of Trust as a holder of a first lien
of record, subject only to Permitted Encumbrances.
22.
Mr
(c) In the event the Company shall fail to maintain, cr
cause to be maintained, the full insurance coverage required by
this Agreement or shall fail to keep the Project in as reasonably
safe condition as its operating conditions will permit, or shall
fail to keep the Project in good repair and good operating
condition, the Authority or the Holder may (but shall be under no
obligation to) , after 30 days' notice to the Company, contract
for the required policies of insurance and pay the premiums on
the same or make any required repairs, renewals and replacements;
and the Company agrees to reimburse the Authority and the Holder
to the extent of the amounts so advanced by them, or any of them,
with interest thereon at a rate per annum equal to the Alterna-
tive Rate of Interest from the date of advancement to the date of
reimbursement.
(d) The Company agrees that to the extent that it shall
fail to carry insurance required by subsection (b) of this
Section, it shall pay promptly to the Holder for application in
accordance with the provisions of subsection (e) hereof such
amount as would have been received as Net Proceeds by the Holder
under the provisions of said subsections (b) and (e) hereof had
such insurance been carried to the extent required.
(e) (i ) The Net Proceeds of the insurance carried pursuant
to the provisions of subsections (b) (ii ) and (b) (iii) shall be
applied by the Company toward extinguishment or satisfaction of
the liability with respect to which such insurance proceeds may
be paid.
(ii) The Net Proceeds of the insurance carried with
respect to the Project pursuant to the provisions of sub-
sections (b) ( i ) and (b) (iv) , and the Net Proceeds resulting
from Eminent Domain, in excess of $50, 000, shall be paid to,
and held in escrow by, the Holder as a special trust fund
pending receipt of written instructions from the Company.
At its option, to be exercised within the period of 30 days
from the receipt by the Holder of such Net Proceeds, the
Company shall advise the Holder in writing that (A) the
Company will use the Net Proceeds for the repair,
replacement, renewal or improvement of the Project ( such
funds to remain in escrow with the Holder and to be drawn
down by the Company as provided in Section 9 of the Bond
Purchase Agreement as in the case of withdrawals from the
Project Fund) , or (B) the Net Proceeds shall be applied to
the prepayment of installments of principal on the Note in
inverse order of maturities as provided in Article X hereof.
The Company shall not exercise the option provided by
Section 7. 7(e) (ii) (A) , however, if in the opinion of a
licensed engineer the repair, replacement, renewal or
improvement of the Project would be impractical under the
23 .
circumstances or there exists an Event of Default under the
Loan Agreement or an event which, but for the giving of
notice or lapse of time or both, would result in such a:+
Event of Default .
The Company agrees that if it shall elect to have any Net
Proceeds applied to the restoration or replacement of the
Project, it will restore or replace the Project , or cause the
same to be done, to a condition substantially equivalent to its
condition prior to the occurrence of the event to which the Net
Proceeds were attributable. Any balance remaining after any such
application of such Net Proceeds shall be applied to prepayment
of installments of principal on the Note in inverse order of
maturities as provided in Article X hereof . The Company shall be
entitled to the Net Proceeds of any insurance or resulting from
Eminent Domain relating to property of the Company not included
in the Project and not providing security for the Note and this
Agreement.
(f) In case of any material damage to or destruction of all
or any part of the Project, the Company shall give prompt written
notice thereof to the Authority and the Holder . In case of a
taking or proposed taking of all or any part of the Project or
any right therein by Eminent Domain, the party upon which notice
of such taking is served shall give prompt written notice to the
other and to the Holder . Each such notice shall describe
generally the nature and extent of such damage, destruction,
taking, loss, proceedings or negotiations.
Section 7.8. Administrative Expenses. The Company agrees
to pay to or for the account of the Authority within 30 days
after notice thereof all reasonable costs and expenses incurred
by the Authority in connection with the financing and adminis-
tration of the Project, except such as may be paid out of the
Bond proceeds, including, without limitation, the costs of
administering the Bond Documents and the fees and expenses of
attorneys, consultants and others.
Section 7 .9 . Indemnity Against Claims. The Company will
pay and discharge and will indemnify and hold harmless the
Authority, the Holder and the Depositary from (a) any lien or
charge upon payments payable hereunder by the Company to the
Authority, and (b) any taxes, assessments, impositions and other
charges in respect of the Project. If any claim of any thereof
is asserted, or any such lien or charge upon payments, or any
such taxes, assessments, impositions or other charges, are sought
to be imposed, the Authority will give prompt written notice to
the Company, the Holder and the Depositary, and the Company shall
have the sole right and duty to assume, and shall assume, the
24 .
defense thereof , with full power to litigate, compromise Dr
settle the same in its sole discretion.
Section 7 . 10 . Release and Indemnification.
shall at all times protect and hold the Authority, The embpany
rs ,
officers , agents and employees , the Holder and its officerseand
employees and the Depositary and its officers and employees
harmless against any claims or liability resulting from any loss
or damage to property or any injury to or death of any person
that may be occasioned by any cause whatsoever pertaining to the
Project or the use thereof, including without limitation any
lease thereof or assignment of its interest in this Agreement ,
such indemnification to include reasonable expenses and
attorneys ' fees incurred by the Authority, its members, officers ,
agents and employees , the Holder and its officers and employees
and the Depositary and its officers and employees in connection
therewith, provided that such indemnity shall be effective only
to the extent of any loss that may be sustained by the Authority,
its members, officers, agents and employees, the Holder and its
officers and employees and the Depositary and its officers and
employees in excess of the Net Proceeds received by it or them
from any insurance carried with respect to such loss and provided
further that the benefits of this Section 7 .10 shall not inure to
any person other than the Authority, its members, officers ,
agents and employees, the Holder and its officers and employees
and the Depositary and its officers and employees.
Section 7 . 11 . Right of Set-Off. The Company covenants that
so long as the Note or the Bond remains unpaid and upon the
occurrence of an event of default under any of the Bond Docu-
ments, which event of default has not been waived or cured, the
Holder shall have the right to set off any and all deposit
balances or other indebtedness held or owing by the Holder to or
for the credit or account of the Company without notice.
25 .
ARTICLE VIII
ASSIGNMENT, LEASE AND SALE
Section 8 .1. Assignment of Agreement or Lease or Sale of
Project by the Company. With the written consent of the Holder
and the Authority, the rights of the Company under this Agreement
may be assigned, and the Project may be leased or sold as a whole
or in part, by the Company; provided, however , that (a) no such
assignment, lease or sale shall relieve the Company from primary
liability for any of its obligations hereunder , and in the event
of any assignment, lease or sale, the Company shall continue to
remain primarily liable for payments to be made pursuant to the
Note and hereto and for the performance and observance of the
other agreements on its part herein provided to be performed and
observed by it to the same extent as though no assignment, lease
or sale had been made, and (b) each lessee, purchaser or assignee
of the Company' s interest in this Agreement shall assume the
obligations of the Company hereunder to the extent of the
interest assigned, leased or sold, and the Company shall, not
more than 60 nor less than 30 days prior to the effective date of
any such assignment, lease or sale, furnish or cause to be
furnished to the Authority a true and complete copy of each such
assignment, lease or purchase contract and assumption of obli-
gations, together with a copy of the written consent of the
Holder. Any costs incurred by the Holder or Authority in
determining that a proposed assignment, lease or sale will not
cause the Bond to be taxable shall be borne by the Company.
Section 8. 2. Restrictions on Transfer of Authority's
Rights. The Authority agrees that, except for the assignment of
its rights under this Agreement pursuant to the Assignment and
its endorsement and pledge of the Note, as security, to the
Holder, it will not during the term of this Agreement sell,
assign, transfer or convey its interests in this Agreement except
as provided in Section 8. 3 .
Section 8. 3 . Assignment by the Authority. It is under-
stood, agreed and acknowledged that the Authority, as security
for payment of the principal of and premium, if any, and interest
on the Bond, will assign to the Holder pursuant to the Assign-
, ment, inter alia, certain of its rights, title and interests in
and to this Agreement ( reserving its rights, however , pursuant to
sections of this Agreement providing that notices, reports and
other statements be given to the Authority and also reserving its
rights to reimbursement and payment of costs and expenses under
Sections 7.8 and 9. 5, its right of access under Section 7 . 1, its
rights to indemnification under Sections 7.9 and 7. 10, and its
individual and corporate rights to exemption from liability under
26 .
Sections 11. 12 and 11 . 13 , all of this Agreement ) and will endorse
and pledge the Note, as security, to the Holder , and the Company
hereby assents to such assignment and endorsement and pledge.
27 .
•
ARTICLE IX
EVENTS OF DEFAULT AND REMEDIES
Section 9 . 1 . Events of Default Defined. The terms "event
of default" and "default" shall mean any one or more of the
following events :
(a) The failure by the Company to make any payment
when due under the Note or under this Agreement within 10
days of its due date.
(b) The occurrence of an event of default under any of
the Bond Documents.
(c) The breach by the Company of any of its repre-
sentations or warranties contained in Section 2 . 2 .
(d) If a final judgment, which with other outstanding
final judgments against the Company or any Affiliate exceeds
an aggregate of $25, 000, shall be rendered against the
Company or any Affiliate and if within sixty ( 60 ) days after
entry thereof such judgment shall not have been discharged
or execution thereof stayed pending appeal, or if within
sixty ( 60) days after the expiration of any such stay such
judgment shall not have been discharged.
(e) The Company shall become insolvent, or admit in
writing its inability to pay its debts as they mature, or
make an assignment for the benefit of creditors, or apply
for or consent to the appointment of a receiver, custodian
or trustee for it or for a substantial part of its property
or business, or such a receiver , custodian or trustee
otherwise shall be appointed; the Company shall fail
promptly to lift or suspend any execution, garnishment or
attachment of such consequence as will impair the ability of
the Company to complete the Project or to carry on its
operations; bankruptcy, insolvency, reorganization or
liquidation proceedings or other proceedings for relief
under any bankruptcy law or any law for the relief of
debtors shall be instituted by or against the Company
(provided, however, that if such proceedings shall be
commenced without the application or consent of the Company,
the Company shall have a period of 60 days from the com-
mencement of such proceedings to have such proceedings
dismissed) ; or the dissolution or liquidation of the
Company, in whole or in part.
28.
( f) Failure by the Company to observe and perform any
covenant , condition or agreement on the part of the Company
under the Note or this Agreement, other than as referred to
in the preceding paragraphs of this Section 9 . 1, for a
period of 30 days after written notice, specifying such
failure and requesting that it be remedied, is given to the
Company by the Authority unless the Authority and the Holder
shall agree in writing to an extension of such time prior to
its expiration.
(g) Failure by the Company to pay, when due or within
any applicable grace period, any amount owing on account of
indebtedness for money borrowed or for deferred purchases of
property, or the failure by the Company to observe or
perform any covenant or undertaking on its part to be
observed or performed in any agreement evidencing, securing
or relating to such indebtedness, resulting, in any such
case, in an event of default or acceleration by the holder
of such indebtedness of the date on which such indebtedness
would otherwise be due and payable.
Section 9. 2 . Remedies on Default. If Payment of the Bond
shall not have been made, whenever any event of default referred
to in Section 9 .1 shall have happened, the Authority may take any
one or more of the following remedial steps:
(a) By written notice declare all installments payable
pursuant to the Note for the remainder of the term thereof
to be immediately due and payable, whereupon the same shall
become immediately due and payable without presentment ,
demand, protest or any other notice whatsoever, all of which
are hereby expressly waived by the Company; provided,
however, that upon the occurrence of any event described in
Section 9 .1(e) all such amounts shall become immediately due
without demand or acceleration.
(b) Take whatever other action at law or in equity may
appear necessary or desirable to collect the amounts payable
pursuant to the Note then due and thereafter to become due
or to enforce the performance and observance of any obli-
gation, agreement or covenant of the Company under any of
the Bond Documents.
In the enforcement of the remedies provided in this Section
9. 2, the Authority and the Holder may treat all expenses of
enforcement, including, without limitation, legal, accounting and
advertising fees and expenses, as additional amounts payable by
the Company then due and owing.
29 .
Section 9 . 3. Application of Amounts Realized in Enforcement
of Remedies. Any amounts collected pursuant to action taken
under Section 9 . 2 shall be paid to the Holder and applied to the
payment of, first, any costs, expenses and fees incurred by the
Authority or the Holder as a result of taking such action or
collecting such proceeds of insurance; second, any interest which
shall have accrued on any overdue interest on and any overdue
principal of the Bond; third, any overdue interest on the Bond;
fourth, any overdue principal of the Bond; fifth, amounts
permitted to be prepaid pursuant to the Note in accordance with
Section 10 . 1 ; and sixth, if Payment of the Bond shall have been
made, all remaining moneys to the Company.
Section 9 . 4 . No Remedy Exclusive. No remedy herein
conferred upon or reserved to the Authority is intended to be
exclusive of any other available remedy or remedies, but each and
every such remedy shall be cumulative and shall be in addition to
every other remedy given under this Agreement or now or hereafter
existing at law or in equity or by statute. No delay or omission
to exercise any right or power accruing upon default shall impair
any such right or power or shall be construed to be a waiver
thereof, but any such right and power may be exercised from time
to time and as often as may be deemed expedient .
Section 9 . 5. Agreement to Pay Attorneys' Fees and Expenses.
Upon the occurrence of an event of default, if the Authority, the
Holder or the Depositary employs attorneys or incurs other
expenses for the collection of amounts
payable hereunder or for
the enforcement of the
performance or observance of any covenants
or agreements on the part of the Company herein contained,
whether or not suit is commenced, the Company agrees that it will
on demand therefor pay to the Authority, the Holder or the
Depositary or all of them, as the case may be, the reasonable
fees of such attorneys and such other reasonable expenses so
incurred by the Authority, the Holder or the Depositary.
Section 9 .6 . Authority and Company to Give Notice of
Default. The Authority and the Company severally covenant that
they will, at the expense of the Company, promptly give to the
Holder written notice of any default or event of default under
this Agreement of which they shall have actual knowledge or
written notice, but the Authority shall not be liable (except as
provided in Section 11 . 13) for failing to give such notice.
30 .
ARTICLE X
PREPAYMENTS
Section 10 . 1 . Optional Prepayments.
(a) The Company is hereby granted, and shall have, the
option to prepay, together with accrued interest, the unpaid
principal of the Note in whole or in part at any time. In the
event of a prepayment in part, amounts to be applied to the
prepayment of installments of principal on the Note shall be
applied to payments of principal in the inverse order of their
scheduled maturities.
Amounts to be applied to the prepayment of the Note pursuant
to Section 3 of the Security Agreement shall be applied to the
prepayment of installments of principal on the Note in the
inverse order of their scheduled maturities in accordance with
the provisions of subsection (b) of this Section and be deemed to
have been an optional prepayment in accordance with the provi-
sions of this subsection (a) .
(b) To make a prepayment pursuant to this Section 10 . 1, the
Company shall give written notice to the Authority and the Holder
which shall specify therein ( i ) the date of the intended prepay-
ment of the Note, which shall not be less than 10 nor more than
30 days from the date the notice is mailed and ( ii) the principal
amount of the Note to be prepaid.
Section 10 . 2. Mandatory Prepayment in Event of Taxability.
In the event of a Determination of Taxability, the Company shall
forthwith, and in any event within 90 days of any such Determina-
tion, pay the following:
(a) the entire unpaid principal balance of the Note;
plus
(b) accrued but unpaid interest on the entire unpaid
principal balance of the Note, including interest
thereon from the Date of Taxability at the
Alternative Rate of Interest; plus
(c) an amount equal to all penalties or interest paid
by the Holder and all former Holders resulting
from the failure to include interest on the Bond
in the gross income of the Holder or such former
Holders; plus
31.
(d) an amount equal to all administrative, out-of-
pocket and other expenses incurred by the Holder
and all former Holders which are directly or
indirectly attributable to the interest on the
Bond becoming subject to federal income tax,
including, without limitation, costs incurred by
such Holder or Holders in amending its or their
federal tax returns.
Section 10 . 3 . Mandatory Prepayment in Event of
Cessation of Operation. In the event of a "cessation of
operation" , the Company shall be required to prepay, within
30 days of the date of "cessation of operation" , the unpaid
aggregate amount of the Note plus interest accrued to the
date of prepayment.
For purposes of this Section 10 .3, a "cessation of
operation" shall not be deemed to have occurred until 30
days shall have elapsed after written notice has been given
to the Company by the Authority or the Holder that operation
of the Project shall have ceased and the Company shall not
have demonstrated to the satisfaction of the Authority and
the Holder that the Company (or an assignee or lessee) is
operating the Project or is, in good faith, seeking to
arrange resumption of an economically reasonable operation
of the Project.
Section 10 . 4 . Relative Priorities. The obligations of
the Company set forth in Section 10. 2 shall be and shall
remain prior and superior to the rights and obligations of
the Company set forth in Sections 10 .1 and 10 .3.
32 .
ARTICLE XI
MISCELLANEOUS
Section 11. 1 . References to the Bond Ineffective After
Bond Paid. Upon Payment of the Bond, all references in this
Agreement to the Bond shall be ineffective and the Authority
and the Holder shall not thereafter have any rights
hereunder excepting those that shall have theretofore
vested; provided, that the rights of the Authority and any
Holder or former Holder to receive certain additional
payments upon the occurrence of a Determination of
Taxability shall survive Payment of the Bond.
Section 11 . 2. No Implied Waiver. In the event any
agreement contained in the Note or in this Agreement should
be breached by either party and thereafter waived by the
other party, such waiver shall be limited to the particular
breach so waived and shall not be deemed to waive any other
breach thereunder or hereunder.
Section 11. 3 . Authority Representative. Whenever
under the provisions of this Agreement the approval of the
Authority is required or the Authority is required to take
some action at the request of the Company, such approval
shall be made or such action shall be taken by the Authority
Representative; and the Company and the Holder shall be
authorized to rely on any such approval or action.
Section 11. 4. Company Representative. Whenever under
the provisions of this Agreement the approval of the Company
is required or the Company is required to take some action
at the request of the Authority, such approval shall be made
or such action shall be taken by the Company Representative;
and the Authority and the Holder shall be authorized to rely
on any such approval or action.
Section 11.5. Notices. All notices, certificates or
other communications hereunder shall be sufficiently given
and shall be deemed given when delivered by hand delivery or
on the third day following the day on which the same has
been mailed by registered or certified mail, return receipt
requested, postage prepaid, addressed as follows: if to the
Authority, at The Orange County Industrial Facilities and
Pollution Control Financing Authority, 110 North Churton
Street, Hillsborough, North Carolina 27278, Attention:
County Attorney; if to the Company, to Isotechnologies,
Inc. , P.O. Box 640, 501 S. Greensboro Street, Building B,
Carrboro, North Carolina 27510, Attention: President; if to
33 .
the Local Government Commission of the State, at .. Local
Government Commission, 325 North Salisbury Street, Raleigh,
North Carolina 27611, Attention: Secretary; if to the
Holder, at NCNB National Bank of North Carolina, P.O. Box
570, Chapel Hill , North Carolina 27514, Attention: Mr . Randy
Dickerson; and if to the Depositary, at NCNB National Bank
of North Carolina, One NCNB Plaza, Charlotte, North Carolina
28233, Attention: Corporate Securities Services . A
duplicate copy of each notice, certificate or other
communication given hereunder by either the Authority or the
Company to the other shall also be given to the Holder . The
Authority, the Company, the Depositary and the Holder may,
by notice given hereunder, designate any further or
different addresses to which subsequent notices, certif-
icates or other communications shall be sent.
Section 11 .6. If Performance Date a Legal Holiday. If
the last date for performance of any act or the exercising
of any right, as provided in this Agreement, shall be a
legal holiday or a day on which banking institutions in the
State are authorized by law to remain closed, such payment
may be made or act performed or right exercised on the next
succeeding day not a legal holiday nor a day on which such
banking institutions are authorized by law to remain closed.
Section 11 . 7. Binding Effect. This Agreement shall
inure to the benefit of and shall be binding upon the
Authority, the Company and their respective successors and
assigns.
Section 11.8. Severability. In the event any provi-
sion of this Agreement shall be held invalid or unenforce-
able by any court of competent jurisdiction, such holding
shall not invalidate or render unenforceable any other
provision hereof.
Section 11 .9. Amendments& Changes and Modifications.
Subsequent to the issuance of the Bond and prior to Payment
of the Bond, this Agreement and the Note may not be effec-
tively amended, changed, modified, altered or terminated
except in accordance with the Bond Purchase Agreement.
Section 11.10 . Execution in Counterparts. This
Agreement may be executed in several counterparts, each of
which shall be an original and all of which shall constitute
but one and the same instrument.
34.
Section 11 . 11 . Applicable Law. This Agreement sham
be governed by and construed in accordance with the laws cf
the State .
Section 11 . 12 . No Charge Against Authority Credit. No
provision hereof shall be construed to impose a charge
against the general credit of the Authority or any personal
or pecuniary liability upon any member , officer , agent or
employee of the Authority.
Section 11 . 13 . Authority Not Liable. Notwithstanding
any other provision of this Agreement (a) the Authority
shall not be liable to the Company, the Depositary, the
Purchaser or the Holder or any other person for any failure
of the Authority to take action under any of the Bond
Documents unless the Authority ( i) is requested in writing
by an appropriate person to take such action, ( ii ) is
assured of payment of or reimbursement for any expenses in
such action, and ( iii) is afforded, under the existing
circumstances, a reasonable period to take such action, and
(b) except with respect to any action for specific perfor-
mance or any action in the nature of a prohibitory or
mandatory injunction, neither the Authority nor any member
of the Authority nor any other officer , agent or employee of
the Authority shall be liable to the Company, the Deposi-
tary, the Purchaser or the Holder or any other person for
any action taken by the Authority or by its members,
officers, agents or employees, or for any failure to take
action under any of the Bond Documents. In acting under the
Bond Documents, or in refraining from acting under the Bond
Documents, the Authority may conclusively rely on the advice
of its counsel.
Section 11.14 . Amounts Remaining with the Depositary_
or the Holder. Any amounts remaining in the Project Fund or
otherwise in trust with the Depositary or the Holder under
the Bond Documents shall, after Payment of the Bond and
payment of all Administrative Expenses in accordance with
this Agreement, belong to and be paid to the Company by the
Depositary or the Holder, as the case may be.
35 .
IN WITNESS WHEREOF, the Authority and the Company have
caused this Agreement to be executed in their respective
legal names and their respective corporate seals to be
hereunto affixed, and the signatures of duly authorized
persons to be attested, all as of the date first above
written.
THE ORANGE COUNTY INDUSTRIAL FACILITIES
AND POLLUTION CONTROL FINANCING
AUTHORITY
[SEAL]
By:
Chairman
Attest :
Secretary
ISOTECHNOLOGIES, INC.
By:
President
[SEAL]
Attest:
Secretary
36 .
Exhibit A
AFTER THE ENDORSEMENT AS HEREON PROVIDED AND PLEDGE OF THIS NOTE,
THIS NOTE MAY NOT BE ASSIGNED, PLEDGED, ENDORSED OR OTHERWISE
TRANSFERRED EXCEPT TO AN ASSIGNEE OF THE PURCHASER REFERRED TO IN
THE AGREEMENT, WHERE SUCH TRANSFER IS MADE IN ACCORDANCE WITH
SECTION 7 OF THE BOND PURCHASE AGREEMENT, BOTH REFERRED TO HEREIN.
PROMISSORY NOTE
July 1, 1986
FOR VALUE RECEIVED, ISOTECHNOLOGIES, INC. , a North Carolina
corporation ( the "Company" ) , by this promissory note hereby prom-
ises to pay to the order of The Orange County Industrial Facil-
ities and Pollution Control Financing Authority ( the "Authority" )
the principal sum of One Million Five Hundred Thousand Dollars
( $1,500, 000) as hereinafter provided together with interest on
the unpaid principal amount hereof, from the date shown in the
Certificate of Disbursement endorsed on the Bond (hereinafter
mentioned) until payment in full at a variable rate per annum
(except as hereinafter provided) equal to seventy percent ( 70% )
of the rate of interest publicly announced by NCNB National Bank
of North Carolina as its prime rate (the "Prime Rate" ) until
January , 1987 and 65% of the Prime Rate thereafter ;
provide ,
however, that such rate of interest shall not exceed twelve and
one-half percent ( 12. 5%) per annum nor be less than four and
one-half percent ( 4 . 5%) per annum. Interest shall be computed on
the basis of a 360-day year for the actual number of days in each
interest period. Interest only shall be payable monthly on the
unpaid principal amount of this Note on the first day of each
month from August 1, 1986 until July 1, 1987. From and after the
first day of August, 1987, interest and principal shall be
payable in 108 consecutive monthly installments, such
installments to be initially $19,500, each installment to be
applied first to interest and then to principal; provided,
however, that in no event shall any such installment of principal
and interest be less than the amount of interest due and owing in
such month. On each January 1 and July 1, commencing January 1 ,
1988, the monthly installments of principal and interest shall be
adjusted to be equal to an amount sufficient to amortize on a
monthly level debt service basis the then outstanding principal
balance of this Note, assuming that
9 the interest rate hereon
until maturity is the interest rate in effect on such January 1
or July 1 . If no prepayment of the principal hereof is made, the
final installment of principal will become due on July 1, 1996 .
A-1
All such payments shall be made in funds which shall be
immediately available on the due date of such payments and in
lawful money of the United States of America at the office of
NCNB National Bank of North Carolina, Chapel Hill , North Carolina
or at such other place as directed by the Holder hereof in accor-
dance with the Bond Purchase Agreement (as defined in the Agree-
ment hereinafter mentioned) .
If at any time there is a Determination of Taxability (as
defined in the Agreement noted below) , the interest rate payable
hereon from the Date of Taxability (as defined in the Agreement
hereinafter mentioned) shall be a rate per annum equal to the
Prime Rate plus 1%, or the maximum rate allowed by law, whichever
is lower ( the "Alternative Rate of Interest" ) , adjusted upon each
adjustment in the Prime Rate.
If the maximum incremental percentage rate of federal and
North Carolina income tax ( the "NCNB Tax Rate" ) applicable to the
taxable income of the holder of the Bond (as defined in the
Agreement noted below) decreases after the date of the Certificate
of Disbursement, the applicable percentage which is applied to the
Prime Rate in determining the applicable rate of interest hereon
( the "Tax-Exempt Factor" ) immediately prior to such change shall
be adjusted, effective on the date of such change, to equal the
product of (1) the Tax-Exempt Factor as of the date hereof
multiplied by ( 2) a fraction, (a) the numerator of which is 100%
minus the NCNB Tax Rate as so adjusted and (b) the denominator of
which is 100% minus the NCNB Tax Rate in effect on the Date of the
Certificate of Disbursement .
If the 20% percentage specified by Section 291(a) ( 3) of the
Internal Revenue Code of 1954, as amended, or any successor pro-
vision therefor , is increased or decreased after the date of the
Certificate of Disbursement, the tax-exempt rate hereon immediate-
ly prior to such change shall be increased or decreased effective
on the date of such change by 4.1 basis points for each one per-
cent increase or decrease, respectively, in such 20% percentage.
This promissory note is the "Note" referred to in the Loan
Agreement, dated as of July 1, 1986 ( the "Agreement" ) , between
the Company and the Authority.
The Company may at its option, and may under certain
circumstances be required to, prepay together with accrued
interest, all or any part of the unpaid principal of this Note,
as provided in the Agreement.
In the event of a prepayment in part, amounts to be applied
to the prepayment of installments of principal on the Note shall
A-2
be applied to payments of principal in the inverse order of their
scheduled maturities .
Upon the occurrence of an event of default or default
specified in the Agreement, the unpaid principal hereof and
accrued interest thereon may be declared to be forthwith due and
payable as provided in the Agreement, and in the event the
Company shall fail to pay the amounts required to be paid by this
Note when due, the Company shall pay interest on such overdue
amounts at a rate equal to the Alternative Rate of Interest .
The Company hereby promises to pay costs of collection and
reasonable attorneys' fees in case of default on this Note.
This Note shall be governed by and construed in accordance
with the laws of the State of North Carolina.
ISOTECHNOLOGIES, INC.
By
President
[Seal ]
Attest:
Secretary
A-3
ENDORSEMENT
Pay to the order of NCNB National Bank of North Carolina,
without recourse, as holder of the Bond referred to in the
within-mentioned Agreement, as security for said Bond. This
endorsement is given without any warranty as to the authority or
genuineness of the signature of the maker of the Note.
The Orange County Industrial Facilities and
Pollution Control Financing Authority
By
Chairman
A-4
Exhibit B
Description of the Project
The Project consists of the acquisition of a tract of land
of approximately 20 acres located east of Hillsborough, North
Carolina on State Road 1879 or Elizabeth Brady Road near the
intersection of State Road 1879 and U.S. 70, the construction
thereon of an approximately 30 ,000 square foot building and the
acquisition and installation therein of machinery and equipment
to be used by the Company as a manufacturing facility.
B-1
EXHIBIT C
Representations and Warranties relating to tax matters
1 . As of the date of issuance of the Bond, ( i ) there are
not outstanding any issues of bonds the interest on which is
exempt from federal income tax by virtue of the provisions of
Section 103( b) ( 6 ) (A) or (D) of the Code and the proceeds of which
were to be used with respect to the Project or other facilities
located in the County, or outside of the County but within five
miles of the Project , and the principal user of which is or will
be the Company or one or more related persons (as defined in
Section l03(b) ( 6 ) (C) of the Code) and ( ii ) the sum of (A) the
aggregate amount of "capital expenditures" (within the meaning of
Section 103(b) (6) (D) of the Code) with regard to the Project or
to such other facilities paid or incurred during the period
beginning three years before the date of the issuance of the Bond
(and financed otherwise than out of the Bond proceeds) , and (B)
the aggregate authorized face amount of the Bond, is less than
$10,000 ,000 .
2. The commencement of the Acquisition of the Project , and
each of the several components thereof, occurred subsequent to
the date the Authority and the Company executed the Memorandum of
Agreement, dated December 6, 1985, except that no less than
$250, 000 shall have occurred subsequent to the date the Authority
and the Company entered into a Supplemental Memorandum of
Agreement, dated February 25, 1986 .
3 . All of the Bond proceeds (after deducting amounts used
to pay expenses of issuing the Bond) will be used to pay those
items of the Cost of Acquisition of the Project , or portions
thereof, which constitute costs of acquisition, construction,
reconstruction or improvement of land or property of a character
subject to the allowance for depreciation within the meaning of
Section 103(b) ( 6) (A) of the Code and the Tax Regulations.
4. During the period commencing 31 days before the date of
issuance of the Bond, other than the Bond, neither the Company
nor any related person (or group of related persons which
includes the Company) has guaranteed, arranged, participated in,
assisted with, borrowed the proceeds of, or leased facilities
financed by, obligations issued under Section 103(b) of the Code
by any state or local governmental unit or any constituted
authority empowered to issue obligations by or on behalf of any
state or local governmental unit other than the Authority.
During the period commencing on the date of issuance of the Bond
and ending 31 days thereafter, there will be no obligations
C-1
issued under Section 103 ( b) which are guaranteed by the Company
or any related person ( or group of related persons which includes
the Company) or which are issued with the assistance or
participation of, or by arrangement with, the Company or any
related person (or group of related persons which includes the
Company) without the written opinion of Brown & Wood to the
effect that the issuance of such obligations will not adversely
affect their opinion as to the exemption from present federal
income tax of interest on the Bond. Other than the Company or
any related person (or group of related persons including the
Company) , no person has ( i ) guaranteed, arranged, participated
in, assisted with the issuance of, or paid any portion of the
cost of the issuance of, the Bond, and ( ii ) provided any property
or any franchise, trademark or trade name (within the meaning of
Section 1253 of the Code) which is to be used in connection with
the Project.
5. No portion of the Bond proceeds is being used to provide
a facility a purpose of which is retail food and beverage
services, automobile sales or service, or the provision of
' recreation or entertainment, and no portion of the Bond p roceeds
•
is being used to provide any private or commercial golf course,
country club, health club, massage parlor , tennis club, skating
facility ( including roller skating, skateboard and ice skating) ,
racquet sports facility ( including any handball or racquetball
court) , hot tub facility, suntan facility, racetrack, skybox or
other luxury box, airplane, store the principal business of which
is the sale of alcoholic beverages for consumption off premises,
or facility used primarily for gambling.
6 . None of the Bond proceeds will be used as working
capital or to finance inventory or motor vehicles.
7. (a) . As of the date of issuance of the Bond, the sum of
(A) the aggregate authorized face amount of the Bond allocated in
accordance with Section 103(b) (15) (C) of the Code to the Company
or any related person to the Company plus (B) the aggregate
authorized face amount of any outstanding tax-exempt IDB' s (as
defined in Section 103(b) ( 15) (B) of the Code) of the Company, or
any related person to the Company, does not exceed $40 million.
7. (b) . As of the date of issuance of the Bond, the sum of
(A) the aggregate authorized face amount of the Bond allocated in
accordance with Section 103(b) (15) (C) of the Code to any known
test-period beneficiary, as defined in Section 103(b) (15) (D) of
the Code, or any related person thereto (other than the Company
or to any related person to the Company) plus (B) the aggregate
authorized face amount of any outstanding tax-exempt IDB ' s of
such known test-period beneficiary, or any related person thereto
C-2
(other than the Company or any related person to the Company) ,
does not exceed $40 million.
8. There are no other industrial development bonds to which
Section 103 (b) ( 6) of the Code applies, which together with the
Bond, are to be used with respect to ( i ) a single building, ( ii )
an enclosed shopping mall, or ( iii) a strip of offices, stores or
warehouses, using substantial common facilities with the Project
or a portion thereof.
9. Any portion of the Bond proceeds to be used to pay the
cost of Acquisition of any real or personal property (or any
interest therein) to be included in the Project is or will be
with respect to either ( i) real or personal property the first
use of which is pursuant to such Acquisition with the Bond
proceeds; or ( ii) a building (and the equipment therefor) if the
rehabilitation expenditures (as defined in Section 103(b) ( 17) (C)
of the Code) with respect to such building equals or exceeds
fifteen percent ( 15%) of the portion of the cost of acquiring
such building (and equipment) to be financed with the Bond
proceeds; or ( iii) a facility other than a building (and
equipment therefor) if the rehabilitation expenditures (as
defined in Section 103(b) ( 17) (C) of the Code) with respect to
such property equals or exceeds one hundred percent ( 100%) of the
portion of the cost of acquiring such property to be financed
with the Bond proceeds.
10. (a) No portion of the Bond proceeds will be used
directly or indirectly for the acquisition of land or any
interest therein to be used for the purpose of farming.
10. (b) Less than twenty-five percent ( 25%) of the Bond
proceeds is or will be used directly or indirectly for the
Acquisition of land to be used for purposes other than farming.
11. The Bond will not be federally guaranteed within the
meaning of Section 103(h) of the Code. For purposes of this
representation, no principal user of the financed property has
entered into any leases of the financed property to, or sales or
service contracts with, any federal government agency.
■
ppJ.
71
{
C-3
Draft : 6/9/86
ASSIGNMENT
THE ORANGE COUNTY INDUSTRIAL FACILITIES AND POLLUTION CON-
TROL FINANCING AUTHORITY, a political subdivision and body corpo-
rate and politic of the State of North Carolina (the "Assignor" ) ,
for valuable consideration the receipt and sufficiency of which
are hereby acknowledged, hereby pledges, assigns, transfers and
sets over to NCNB NATIONAL BANK OF NORTH CAROLINA, a national
banking association having its principal office in Charlotte,
North Carolina, and its successors and any transferee of the Bond
hereinafter mentioned in accordance with the provisions of
Section 7 of the Bond Purchase Agreement hereinafter mentioned
(the "Assignee" ) , all of the Assignor 's right, title and interest
( including beneficial interest) in and to:
(a) a certain Loan Agreement (as the same may from time to
time be supplemented or amended) , of even date herewith ( the
"Loan Agreement" ) , between the Assignor and Isotechnologies,
Inc. , a North Carolina corporation, and its respective successors
and assigns (the "Company" ) , including, but not limited to, all
payments due and to become due under the Loan Agreement whether
made at their respective due dates or as prepayments permitted or
required by the Loan Agreement, together with full power and
authority, in the name of the Assignor or otherwise, to demand,
receive, enforce, collect or receipt for any or all of the fore-
going, to endorse or execute any checks or other instruments or
orders, to file any claims and to take any action which the
Assignee may deem necessary or advisable in connection therewith,
and the Assignor hereby irrevocably appoints the Assignee attor-
ney-in-fact of the Assignor for such purposes, which appointment
is coupled with an interest and is irrevocable; provided, how-
ever, that the Assignor hereby expressly reserves its rights
( together with the Assignee, where applicable) under the follow-
ing sections of the Loan Agreement :
( i) Section 7.1 (pertaining to the Assignor ' s right of
access to the Project (as defined in the Loan Agreement) and
to certain records) ;
( ii ) Section 7. 3 (pertaining to the Assignor ' s right to
receive certain information) ;
( iii) Section 7.8 (pertaining to the Assignor ' s right to
receive payment for certain costs and expenses) ;
( iv) Section 7 .9 (pertaining to the Assignor ' s right to
certain indemnities) ;
(v) Section 7 .10 (pertaining to the Assignor ' s right to
release and indemnification) ;
(vi) Section 8.1 (pertaining to the Assignor ' s right to
consent to, and to receive notice of, any assignment of the
Loan Agreement or lease or sale of the Project by the
Company) ;
(vii) Section 9 . 5 (pertaining to the Assignor ' s right to
reimbursement of expenses incurred upon a default) ;
(viii) Sections 10. 1, 10. 2 and 10. 3 (pertaining to the
Assignor 's right to notice of prepayments) ;
(ix) Section 11. 5 (pertaining to the Assignor ' s right to
receive certain notices) ; and
(x) Sections 11. 12 and 11.13 (pertaining to the limitations
on the liability of the Assignor ) ;
(b) a promissory note (as the same may from time to time be
supplemented or amended) , of even date herewith ( the "Note" ) , of
the Company to the Assignor evidencing the Company' s obligation
to repay the loan, together with interest thereon and other
amounts with respect thereto, as provided for in the Loan Agree-
ment, the Assignor having on the date shown in the Certificate of
Disbursement endorsed on the Bond (hereinafter mentioned)
endorsed the Note without recourse to the order of , and delivered
the same to, the Assignee in pledge as security for the obliga-
tions of the Assignor to such Assignee hereinafter referred to;
and
(c) the Security Agreement (as the same may from time to
time be supplemented or amended) , of even date herewith (the
"Security Agreement" ) , between the Company and the Assignor
covering certain personal property and fixtures more fully de-
scribed therein; provided, however, that the Assignor hereby
expressly reserves its rights ( together with the Assignee, where
applicable) under the following sections of the Security
Agreement:
(i) Section 7 (pertaining to the Assignor ' s right to
receive payment for certain costs and expenses) ;
(ii) Section 10 (pertaining to the Assignor ' s right to
receive payment for certain advances) ; and
(iii) Section 11(a) (pertaining to the Assignor ' s right to
receive certain notices) .
2.
(d) the Deed of Trust (as the same may from time to time be
supplemented or amended) , of even date herewith ( the "Deed of
Trust" ) , from the Company to , as trustee for the
benefit of the Assignor, covering certain real property more
fully described therein; provided, however, that the Assignor
hereby expressly reserves its rights ( together with the Assignee,
where applicable) under the following sections of the Deed of
Trust:
( i ) Section 6 (pertaining to the Assignor ' s right to
receive payment for certain costs and expenses) ;
( ii ) Section 9 (pertaining to the Assignor ' s right to
receive payment for certain advances) ; and
( iii) Section 12(a) (pertaining to the Assignor ' s right to
receive certain notices) .
No exercise by the Assignee of any rights of the Assignor shall
release the Assignor from any of its obligations under the Loan
Agreement, the Note, the Security Agreement or the Deed of Trust
(hereinafter referred to collectively as the "Bond Documents" ) .
The Assignee may take or release other security, may release
any party primarily or secondarily liable for any indebtedness
secured hereby, may grant extensions, renewals or indulgences
with respect to such indebtedness, and may apply any other secur-
ity therefor held by it to the satisfaction of such indebtedness
without prejudice to any of its rights hereunder . It is further
agreed that nothing herein contained and no act done or omitted
by the Assignee pursuant to the powers and rights granted to it
herein shall be deemed to be a waiver by the Assignee of its
rights and remedies under the Bond (hereinafter defined) or the
Bond Purchase Agreement (hereinafter defined) , but this Assign-
ment is made and accepted without prejudice to any of the rights
and remedies possessed by the Assignee under the terms thereof.
The right of the Assignee to collect said indebtedness and to
enforce any other security therefor held by it may be exercised
by the Assignee either prior to, simultaneously with, or subse-
quent to any action taken by it hereunder.
This Assignment is given in order to secure the payment of
principal of, premium, if any, and interest on the Bond (the
Bond" ) issued by the Assignor pursuant to the terms of a Bond
Purchase Agreement, of even date herewith ( the "Bond Purchase
Agreement" ) , among the Assignor , the Assignee and the Company.
This Assignment shall terminate upon Payment of the Bond (as
defined in the Loan Agreement) . The Assignee, at the Company' s
expense, will execute and deliver such instruments as the Assign-
or may reasonably request to evidence such termination.
3.
( 1) Application of Proceeds
If no default or event of default (as defined in Section 9 . 1
of the Loan Agreement) shall have occurred, all funds covered by
this Assignment shall be paid and applied as follows:
(a) each payment to be made pursuant to the Note shall
be paid by the Company directly to the Assignee on or before
the due date of such payment under the Loan Agreement, and
shall be applied in accordance with the terms of the Bond;
(b) all amounts prepaid or paid by the Company pursu-
ant to Sections 10 .1, 10. 2 and 10. 3 of the ' pan Agreement
shall be paid to the Assignee and applied to :.ae prepayment
or payment of the Bond, as provided in the Loan Agreement
and the Bond; and
(c)- all other funds covered by this Assignment ( in-
cluding any excess of any payment over the concurrent aggre-
gate payments due on the Bond) shall be applied as provided
in the Loan Agreement and the Bond.
If any default or event of default under the Loan Agreement
shall have occurred, all funds covered by this Assignment shall
be paid to the Assignee who shall hold all funds received and
shall apply the same in the manner specified in Section 9. 3 of
the Loan Agreement and in the Bond.
( 2) Assignee Not Liable for Obligations of Others
Neither this Assignment nor any action or inaction on the
part of the Assignee shall, without its written consent, consti-
tute an assumption on its part of any obligation under any of the
Bond Documents; nor shall the Assignee have any obligation to
make any payment to be made by the Assignor under any of the Bond
Documents, or to present or file any claim, or to take any other
action to collect or enforce the payment of any amounts which
have been assigned to the Assignee or to which they may be en-
titled under this Assignment at any time or times. No action or
inaction on the part of the Assignee shall adversely affect or
limit in any way the rights of the Assignee under this Assignment
or any of the Bond Documents.
The Assignor shall, however, remain liable to perform all of
its obligations under the Bond Documents and shall enforce the
Bond Documents in accordance with their respective terms, main-
tain the Bond Documents in full force and effect and comply with
all the terms of each thereof.
4.
( 3) Representations and Covenants of Assignor
The Assignor represents and warrants that (a) each of the
Bond Documents is in full force and effect and na5 hot been
assigned or encumbered by it except pursuant to thl , A sinment ,
(b) the Note is in full force and effect and has no b-en e---
dorsed, assigned or encumbered by the Assignor e::oept withc'..t
recourse to the order of the Assignee and (c) no default exists
under any of the Bond Documents.
The Assignor covenants that so long as this Assignment shall
remain in effect it will not assign or encumber, to anyone other
than the Assignee, the whole or any part of the moneys, claims
and rights hereby assigned, and that it will not, without the
prior written approval of the Assignee (any agreement enterer
into without such consent being void) , amend, modify or cancel
any of the Bond Documents, accept the surrender of any thereof,
give any consent or waiver or make any acceptance or rejection
thereunder, or take or omit to take any action, the taking or
omission of which might result in an alteration or impairment of
any of the Bond Documents or this Assignment or any of the rights
created by any of such instruments.
The Assignor , at the Company ' s expense, will execute and
deliver all such instruments and take all such action as the
Assignee from time to time may reasonably request in order to
obtain the full benefits of this Assignment and of the rights and
powers herein created.
(4) Consent and Agreement of Company
The Company hereby acknowledges receipt of an executed copy,
and consents to the execution, of this Assignment. As an induce-
ment to the Assignor to enter into the Loan Agreement, the Com-
pany, for valuable consideration, agrees that:
(a) it will be bound by the terms and provisions
hereof;
(b) it will pay, or cause to be paid, directly to t`.-.e
Assignee, or in accordance with subsequent directions re-
ceived from the Assignee, all payments and prepayments due
under any of the Bond Documents, such payments and prepay-
ments to be made regardless of any right of set-off or
counterclaim or other defense which the Company may have
against the Assignor or the Assignee, it being the intent
hereof that the Company shall be absolutely and uncondition-
ally obligated to pay all such sums;
5.
(c) it will promptly provide or cause to be provided
to the Assignee copies of each communication, including, but
not limited to, certificates and financial statements re-
quired by Section 7 .3 of the Loan Agreement, which the
Company sends to the Assignor;
(d) except with the written consent of the Assignee,
none of the Bond Documents will be terminated, modified or
amended (any agreement in violation of the foregoing being
void) , and the Company will not take or omit to take any
action, the taking or omission of which might result in any
alteration or impairment of any of the Bond Documents or
this Assignment;
(e) any notice to the Company by the Assignee shall
have the same force and effect as a notice given by the
Assignor;
(f) without limiting the generality of any of the
foregoing, any consent provided for in any of the Bond
Documents which may be given by the Assignor shall not be
valid unless approved in writing by the Assignee, and no
offer made by the Company under any of the Bond Documents
shall be deemed accepted or rejected by the Assignor without
such approval; and
(g) the Assignee may execute on behalf of the Company
continuation statements and amendments to financing state-
ments with respect to the Bond Documents and this Assignment
under the Uniform Commercial Code. The Company hereby (a)
irrevocably appoints the Assignee as its true and lawful
attorney for such purpose, with full power of substitution,
and (b) ratifies and confirms all that such attorney or any
substitute shall lawfully do by virtue hereof. If so re-
quested by the Assignee, the Company shall ratify and con-
firm all proper continuation statements and amendments to
financing statements as may be designated in any such
request.
(5) Representations of Company
As a further inducement to the Assignee to purchase the Bond
pursuant to the Bond Purchase Agreement, the Company represents
and warrants that (a) it is a corporation incorporated and exist-
ing under the laws of the State of North Carolina, (b) it has
full power , authority and legal right to execute and deliver, and
to perform and observe the provisions of, each of the Bond Docu-
ments and this Assignment, each of which have been duly author-
ized and executed by the Company and each of which is enforceable
against the Company in accordance with its terms, (c) there are
6.
no actions, proceedings or investigations pending or threatened
against or affecting the Company (or any basis therefor known to
the Company) before any Court, arbitrator , administrative agency
or other governmental authority, which if adversely decided would
materially affect its ability to carry out any of the terms,
covenants and conditions of any of the Bond Documents or this
Assignment, (d) each of the Bond Documents is in full force and
effect, (e) no payments due or to become due under the Loan
Agreement and the Note have been prepaid, and (f) neither the
Assignor nor the Company is in default in the performance of, or
compliance with, any term or condition of any of the Bond Docu-
ments and no off-set or claim exists against the Assignor or the
Assignee with respect to any of the Bond Documents or this
Assignment.
( 6) Miscellaneous
This Assignment is intended to create and does create in the
Assignee, as security for the payment of the principal of,
premium, if any, and interest on the Bond, a security interest in
all the payments due under the Loan Agreement and the Note and in
all proceeds from the Security Agreement and the Deed of Trust.
This Assignment is subject to the provisions of Sections
11.12 and 11. 13 of the Loan Agreement with regard to limitations
on the Assignor ' s general credit and the personal or pecuniary
liability of any member, officer, agent or employee of the
Assignor .
This Assignment shall be governed by and construed in accor-
dance with the laws of the State of North Carolina.
This Assignment shall be binding upon the Assignor, includ-
ing its successors and assigns, and shall inure to the benefit of
the Assignee, including its successors and assigns.
- This Assignment may be executed in several counterparts,
each of which shall be an original and all of which shall consti-
tute one and the same instrument.
IN WITNESS WHEREOF, the Assignor has caused this Assignment
to be executed and its corporate seal to be hereunto affixed by
7 .
its proper officers thereunto duly authorized as of the 1st day
of July, 1986.
THE ORANGE COUNTY INDUSTRIAL
FACILITIES AND POLLUTION CONTROL
FINANCING AUTHORITY
(Seal ) By
Chairman
Attest :
Secretary
Accepted and agreed to as of the
1st day of July, 1986
NCNB NATIONAL BANK OF NORTH CAROLINA
Assignee
By
Vice President
8.
CONSENT:
Isotechnologies, Inc. , as the "Company" hereinabove referred
to, hereby as of the date thereof consents to the foregoing
Assignment and agrees that it will be bound by its terms and
provisions, including, without limitation, its provisions for the
direct payment of amounts due under the Loan Agreement to the
Assignee.
ISOTECHNOLOGIES, INC.
By
President
[Acknowledgment]
_ Draft : 6/9/86
DEED OF TRUST
NORTH CAROLINA:
ORANGE COUNTY:
THIS DEED OF TRUST, dated as of July 1, 1986 ( the "Deed of
Trust" ) , from ISOTECHNOLOGIES, INC. , a North Carolina corporation
( the "Company" ) , to ( the "Trustee") for the benefit
of THE ORANGE COUNTY INDUSTRIAL FACILITIES AND POLLUTION CONTROL
FINANCING AUTHORITY, a political subdivision and body corporate
and politic of the State of North Carolina ( the "Beneficiary" ) .
W I T N E S S E T H:
WHEREAS, the Company has entered into a Bond Purchase Agree-
ment, of even date herewith ( the "Bond Purchase Agreement" ) , with
the Beneficiary and NCNB National Bank of North Carolina, a
national banking association with its principal office in
Charlotte, North Carolina ( the "Purchaser" ) , which provides for
the financing by the Beneficiary of the cost of the acquisition,
construction and installation of the Project (as defined in the
Loan Agreement hereinafter referred to) for the Company through
(a) the issuance by the Beneficiary of its industrial revenue
bond in the principal amount of $1, 500,000 ( the "Bond" ) in
substantially the form of Exhibit A to the Bond Purchase
Agreement, (b) the Beneficiary's making a loan of the proceeds of
the Bond to the Company, evidenced by a promissory note of the
Company ( the "Note" ) , pursuant to a Loan Agreement, of even date
herewith (the "Loan Agreement" ) , between the Beneficiary as
lender and the Company as borrower , (c) the pledge of the Note,
endorsed without recourse to the order of the Purchaser , and the
assignment of certain of the Beneficiary' s rights in the Loan
Agreement, this Deed of Trust and the Security Agreement
hereinafter referred to pursuant to an Assignment, of even date
herewith (the "Assignment") , by the Beneficiary to the Purchaser,
its successors and any transferees of the Bond in accordance with
Section 7 of the Bond Purchase Agreement ( the "Holder" ) to secure
the Bond, (d) the grant by the Company to the Beneficiary of a
security interest in certain personal property and fixtures more
particularly described therein pursuant to the terms of a
Security Agreement, of even date herewith ( the "Security
Agreement" ) , as additional security for the Note, (e) the grant
of this Deed of Trust on certain real property more particularly
1
described herein as additional security for the Note, ( f ) the
unconditional guaranty by the Company of the timely payment of
the principal of, premium, if any, and interest on the Bond
pursuant to the terms of a Guaranty Agreement , of even date
herewith ( the "Company Guaranty" ) , as additional security for the
Bond, and (g) the unconditional guaranty by Mr . & Mrs. Jerome J.
Richardson of the timely payment of the principal of, premium, if
any, and interest on the Bond pursuant to the terms of a Guaranty
Agreement, of even date herewith (the "Personal Guaranty" ) , as
additional security for the Bond; and
WHEREAS, the Company is indebted to the Beneficiary in the
sum of $1,500,000 for money loaned, as evidenced by, and payable
as provided in, the Note, with interest payable as and at the
rates specified therein, with the last payment of principal and
interest being due and payable on July 1, 1996 ; and
WHEREAS, the Company desires to secure ( i ) the payment of
the principal of the Note together with interest and premium, if
any, thereon, ( ii ) the payment of any and all other indebtedness
which this Deed of Trust by its terms secures, and ( iii ) the
performance of the covenants and agreements contained in this
Deed of Trust , the Loan Agreement, the Security Agreement and the
Bond Purchase Agreement and any amendments and supplements
thereto;
NOW, THEREFORE, the Company, as additional security for the
Note and any other obligations under the Bond Documents and in
further consideration of the sum of $1. 00 paid to the Company by
the Trustee, receipt and sufficiency of which are hereby
acknowledged, has given, granted, bargained and sold, and by
these presents does give, grant, bargain, sell and convey unto
the Trustee, his successors and assigns, the real property lying
and being in Orange County in the State of North Carolina, more
particularly described as set forth in Schedule I attached hereto
and made a part hereof;
TOGETHER with all improvements and fixtures now or hereafter
erected or located thereon, all rights, appurtenances, easements,
privileges, remainders and reversions appertaining thereto and
all apparatus, equipment, fixtures and articles of personal
property now or hereafter attached to the real property described
above as fixtures, and all parts, substitutes, renewals or
replacements thereof, and additions, modifications, improvements,
accumulations and accessions thereto, including, but not limited
to, all heating, refrigerating, air conditioning, gas, plumbing
and electric apparatus and equipment, all boilers, engines ,
motors, power equipment, piping and plumbing fixtures, pumps,
tanks, lighting equipment and systems, fire prevention and
sprinkling equipment and systems, and other things now or
2 .
hereafter thereon or therein, including all interests of any
owner of the Project (as defined in the Loan Agreement) in any of
such items, except those reserved pursuant hereto, at any time
acquired under conditional sale contracts or installment sale
contracts; excluding, however, from this Deed of Trust and from
the Trust Estate (as hereinafter defined) any items thereof which
shall not constitute real property or fixtures under the laws of
North Carolina;
TOGETHER WITH all proceeds of any of the foregoing real
property and fixtures, including, without limitation, proceeds of
the conversion, voluntary or involuntary, of any of the foregoing
into cash or liquidated claims, including, without limitation,
all awards and other payments as a result of or in lieu or in
anticipation of the exercise of the right of condemnation or
eminent domain by any governmental authority ( "Eminent Domain" ) ,
all insurance proceeds and claims therefor as a result of damage
to or destruction of all or any part of any of the foregoing, and
all proceeds of title insurance with respect to all or any part
of any of the foregoing ( the real property, fixtures and proceeds
granted to the Trustee pursuant to the foregoing provisions
hereof being collectively referred to as the "Trust Estate" ) ;
TO HAVE AND TO HOLD the Trust Estate, with all the rights,
privileges and appurtenances thereunto belonging or appertaining
to the Trustee, his successors and assigns, in fee simple
forever , upon the trusts and for the uses and purposes
hereinafter set out;
AND THE COMPANY hereby warrants and represents to the
Trustee and his heirs, administrators, successors and assigns
that the Company is seized of the Trust Estate in fee simple and
has the right to convey the same; that the Trust Estate is
subject to no liens or encumbrances (other than Permitted
Encumbrances as defined in the Loan Agreement ) and that the
Company will defend the title to the Trust Estate against the
claims of all persons whomsoever; provided, however, that
THIS CONVEYANCE IS MADE UPON THIS SPECIAL TRUST, that if the
Company shall pay the Note and other obligations secured hereby
in full in accordance with its terms, the security interests
granted hereby shall terminate and all rights to the Trust Estate
shall revert to the Company. Upon any such termination, the
Beneficiary will, at the Company's expense, execute and deliver
to the Company such documents as the Company shall reasonably
request to evidence such termination.
Section 1 . Maintenance and Modification of Trust Estate by
Company. The Trustee shall not be under any obligation to
operate, maintain or repair the Trust Estate. The Company agrees
3.
that until Payment of the Bond (as defined in the Loan Agreement )
shall be made it will at its own expense ( i ) keep the Trust
Estate in as reasonably safe condition as its operations shall
permit, ( ii ) keep the Trust Estate in good repair and in good
operating condition, and ( iii ) make from time to time all
necessary repairs thereto and renewals and replacements thereof .
The Company shall not permit or suffer others to commit a
nuisance in or about the Trust Estate or itself commit a nuisance
in connection with its use or occupancy of the Trust Estate.
The Company may, also at its own expense, make from time to
time any additions, modifications or improvements to the Trust
Estate that it may deem desirable for its business purposes and
that do not materially impair the effective use, nor materially
decrease the value, of the Trust Estate. All such additions,
modifications and improvements made by the Company shall become
part of the Trust Estate. The Company agrees to pay when due the
purchase price of and all costs and expenses with respect to the
acquisition, construction or installation of any such addition,
modification and improvement.
Section 2 . Remedies of the Trustee Upon Default:
(a) The following events shall constitute events of
default hereunder :
( i ) default in the payment or any of the other
terms or conditions of the Note secured hereby and the
expiration of any applicable grace or notice periods
provided thereby;
( ii ) failure by the Company to observe and perform
any covenant, condition or agreement on the part of the
Company under this Deed of Trust (except if such fail-
ure results in an event of default under clause ( i )
above) for a period of 30 days after written notice
specifying such failure and requesting that it be
•
remedied is given to the Company by the Beneficiary
unless the Beneficiary shall agree in writing to an
extension of such time prior to its expiration;
provided, however, that if the failure stated in the
notice cannot be reasonably corrected within the
applicable period, such period shall be extended for
the period of time reasonably required to correct such
failure provided the Company promptly commences and
diligently pursues the curing thereof;
( iii ) default in any of the terms, conditions or
covenants contained in the Bond Purchase Agreement, the
Loan Agreement, the Security Agreement, the Assignment,
4 .
the Company Guaranty , the Personal Guaranty or the Bond
or any amendments and supplements thereto and the
expiration of any applicable grace or notice periods
provided thereby; or
( iv) any lien, charge or encumbrance prior to or
affecting the validity of this Deed of Trust is found
to exist, other than Permitted Encumbrances, or
proceedings be instituted to enforce any lien, charge
or encumbrance against any of said Trust Estate and
such lien, charge or encumbrance would be prior to the
lien of this Deed of Trust.
(b) If an event of default shall have occurred, the
Trustee or the Beneficiary shall have the right to enter
upon the aforementioned property to such extent and as often
as the Trustee or the Beneficiary, in their discretion, deem
necessary or desirable in order to prevent or to cure any
default by the Company. The Trustee or the Beneficiary may
take possession of all or any part of the Trust Estate
together with the books, papers and accounts of the Company
pertaining thereto and may hold, operate and manage the
same, and from time to time make all needful repairs and
improvements as shall be deemed expedient by the Trustee or
Beneficiary; and the Trustee or Beneficiary may lease all or
any part of the Trust Estate in the name of and for the
account of the Company, and collect, receive and sequester
the rent , revenues, receipts, earnings, income, products and
profits therefrom, and out of the same and from any moneys
received from any receiver of any part thereof pay, and set
up proper reserves for the payment of, all proper costs and
expenses of so taking, holding and managing the same,
including reasonable compensation to the Trustee or the
Beneficiary, their agents and counsel, and any charges of
the Trustee or Beneficiary hereunder , and any taxes and
assessments and other charges prior to the lien of this Deed
of Trust which the Trustee or the Beneficiary may deem it
proper to pay, and all expenses of such repairs and
improvements, and apply the remainder of the moneys so
received in accordance with the provisions hereof.
If an event of default shall have occurred, the Trustee
or the Beneficiary shall have the right to appoint a
receiver to collect the rents and profits from the Trust
Estate without consideration of the value of the premises or
the solvency of any person liable for the payment of the
amounts then owing, and all amounts collected by the
receiver shall, after expenses of the receivership, be
applied to the payment of the indebtedness secured hereby,
and the Trustee or the Beneficiary, at their option, in lieu
5 .
y
of an appointment of a receiver , shall have the right to do
the same. If such receiver should be appointed or if there
should be a sale of the said premises , as provided below,
the Company, or any person in possession of the premises
thereunder, as tenant or otherwise, shall become a tenant at
will of the receiver or of the purchaser and may be removed
by a writ of ejectment, summary ejectment or other lawful
remedy.
(c) If an event of default shall have occurred, the
Trustee or the Beneficiary shall have the right to assign to
any other person, for lawful consideration, any rents,
revenues , earnings, income, products and profits receivable
under this Deed of Trust, provided that the proceeds of any
such assignment shall be applied as provided in this Deed of
Trust.
(d) If an event of default shall have occurred, the
Trustee is hereby authorized and empowered, upon application
of the Beneficiary, to expose to sale and to sell the
hereinbefore described property, or any part thereof or any
interest therein, at public auction for cash, after first
having complied with all applicable requirements of North
Carolina law with respect to the exercise of powers of sale
contained in deeds of trust.
The Company agrees that in the event of a sale
hereunder the Beneficiary shall have the right to bid
thereat and to become the purchaser . The Trustee may
require the successful bidder at any sale to deposit
immediately with the Trustee cash or a certified check in an
• amount not to exceed five percent of his bid, provided
notice of such requirement is contained in the advertisement
of the sale. The bid may be rejected if the deposit is not
immediately made and thereupon the next highest bidder may
be declared to be the purchaser. Such deposit shall be
refunded in case a resale is had; otherwise it shall be
applied to the purchase price. The sale of the Trust Estate
or any part thereof or any interest therein, whether
pursuant to foreclosure, power of sale or otherwise under
this Deed of Trust, shall forever bar any claim with respect
to the Trust Estate by the Company.
(e) The Company hereby waives, to the full extent it
lawfully may, the benefit of all appraisement, valuation,
stay, moratorium, exemption from execution, extension and
redemption laws and any statute of limitations, now or
hereafter in force, and all rights of marshalling in the
event of the sale of the Trust Estate or any part thereof or
any interest therein. The Company also hereby waives, to
6 .
the full extent it may lawfully do so, all errors , defects
and imperfections in any proceeding instituted by the
Trustee under the Deed of Trust .
The foregoing shall in no way be construed to limit the
powers of sale or to restrict the discretion the Trustee may
have under the provisions of Article 2A of Chapter 45 of the
General Statutes of North Carolina, as the same may be from
time to time amended. Each legal, equitable or contractual
right, power or remedy of the Trustee now or hereafter
provided herein or by statute or otherwise shall be
cumulative and concurrent and shall be in addition to every
other right, power and remedy, and the exercise or beginning
of the exercise by the Trustee of any one or more of such
rights, powers and remedies shall not preclude the
simultaneous or later exercise of any or all such other
rights, powers and remedies.
Section 3. Application of Proceeds. The proceeds of
(a) the operation and management of the Trust Estate pursuant to
Section 2 hereof, (b) any sale of the Trust Estate or any part
thereof or any interest therein, whether pursuant to foreclosure,
power of sale or otherwise, and (c) any insurance policies or
Eminent Domain (as such term is defined in the Loan Agreement)
awards or other sums (other than awards or sums to which the
Company is entitled under the Loan Agreement) to which the
Trustee is entitled upon the occurrence of an event of default
shall be applied to pay:
First: The costs and expenses of the sale, reasonable
attorneys' fees, the Trustee 's commission payable under
Section 4 hereof, court costs and any other expenses or
advances made or incurred in the protection of the rights of
the Beneficiary or in the pursuance of any remedies
hereunder;
Second: Any indebtedness secured by this Deed of Trust
and at the time due and payable (whether by acceleration or
otherwise) , including all amounts of principal and interest
at the time due and payable with respect to the Note, and
interest on any overdue principal of, and ( to the extent
permitted by applicable law) interest on the Note at a rate
per annum equal to the Alternative Rate of Interest (as
defined in the Loan Agreement) ; and
Third: The balance, if any, to the persons then
entitled thereto under the Loan Agreement.
Section 4. Trustee's Commission. In the event of a
consummated sale under the power of sale contained herein, the
7 .
Trustee ' s commission shall be one percent ( 1% ) of the bid
thereat . In the event the Trustee shall be directed to institute
a sale under the power of sale contained herein and thereafter
all defaults shall be remedied and such proceeding shall be
dismissed, the Company shall pay to the Trustee an amount equal
to one half of one percent ( . 5% ) of the outstanding principal
balance on the Note and all reasonable counsel and other fees and
expenses incurred by the Trustee prior to such dismissal .
Section 5 . General Covenant. The Company shall pay the
principal of and premium, if any, and interest on the Note and
shall observe and perform all covenants, conditions and agree-
ments contained in the Note, the Loan Agreement, the Company
Guaranty, the Security Agreement and this Deed of Trust , and any
amendments and supplements thereto.
Section 6. Payment of Costs, Attorneys' Fees and Expenses.
As between the Beneficiary and the Company, the Company shall pay
any and all costs, attorneys ' fees and other expenses of whatever
kind incurred by the Trustee or the Beneficiary in connection
with (a) obtaining possession of the Trust Estate, (b) the
operation, management, protection and preservation of the Trust
Estate, (c) the collection of any sum or sums secured hereby,
(d) any litigation involving the Trust Estate, this trust, any
benefit accruing by virtue of the provisions hereof, or the
rights of the Trustee or the Beneficiary, (e) the presentation of
any claim under any administrative or other proceeding in which
proof of claim is required by law to be filed, ( f) any additional
examination of the title to the Trust Estate which may be
reasonably required by the Trustee or the Beneficiary, or
(g) taking any steps whatsoever in enforcing this Deed of Trust,
claiming any benefit accruing by virtue of the provisions hereof,
or exercising the rights of the Beneficiary hereunder .
Section 7. Insurance and Taxes. Pursuant to Sections 7 . 7
and 6 . 2 of the Loan Agreement, the Company will obtain and
maintain certain insurance and will pay all lawful taxes,
assessments and charges at any time levied or assessed upon or
against the Trust Estate or any part thereof; provided, however ,
• that nothing contained in this Deed of Trust shall require the
maintenance of insurance or the payment of any such taxes,
assessments or charges if the same are not required to be paid
under Sections 7 .7 and 6.2 of the Loan Agreement .
Section 8. No Conveyance or Sale of, or Liens on, Trust
Estate. The Company will make no conveyance, sale or other
disposition of the Trust Estate or any part thereof or any
interest therein without the prior written consent of the
Beneficiary, except as provided in Section 8.1 of the Loan
Agreement .
8 .
Section 9 . Advances by Trustee or Beneficiary. The Trustee
and the Beneficiary are authorized to, but shall not be
obligated, to make for the account of the Company, any required
payments under any lien prior hereto, or under the Loan Agreement
or this Deed of Trust, the non-payment of which would constitute
a default, including but not limited to principal payments ,
interest payments, premium payments , if any, taxes and insurance
premiums. All sums so advanced shall attach to and become part
of the debt secured hereby, shall become payable at any time on
demand therefor and, from the date of the advance to the date of
repayment, any sum so advanced shall bear interest at a rate per
annum equal to the Alternative Rate of Interest (as defined in
the Loan Agreement) . The failure to make payment on demand
shall, at the option of the Beneficiary, constitute a default
hereunder, giving rise to all of the remedies herein provided for
an event of default . The Trustee or the Beneficiary, as the case
may be, shall notify the Company in writing of any such advance
within 30 days of the date thereof; provided, however, that the
failure to so notify shall not impair any rights of the Trustee
or the Beneficiary under this Deed of Trust.
The Beneficiary and the Trustee (with the permission of the
Beneficiary) may grant any extension, forbearance or other
indulgence, may release any part of the Trust Estate from the
lien hereof and may release any person from liability without
affecting the personal liability of any person for payment and
performance of the debt secured hereby or the lien hereof.
Section 10 . The Trustee. The Trustee shall be under no
duty to take any action hereunder except as expressly required,
or to perform any act which would involve him in expense or
liability or to institute or defend any suit in respect hereof,
unless properly indemnified to his satisfaction. All reasonable
expenses, charges, counsel fees and other disbursements incurred
by the Trustee in and about the administration and execution of
the trusts hereby created, and the performance of his duties and
powers hereunder , shall be secured by this Deed of Trust prior to
the Note and shall bear interest at a rate equal to the
Alternative Rate of Interest (as defined in the Loan Agreement) .
The Beneficiary shall at any time have the irrevocable right to
remove the Trustee herein named without notice or cause and to
appoint his successor by an instrument in writing, duly
acknowledged, in such form as to entitle such written instrument
to be recorded in the State of North Carolina. The Trustee may
resign at any time by giving written notice thereof to the
Beneficiary, such resignation to become effective upon the
appointment by the Beneficiary of a successor Trustee by an
instrument described in the next preceding sentence, and
acceptance of such appointment by such successor Trustee. Any
successor Trustee, appointed as provided above, shall be vested
`.:
9 .
with title to the Trust Estate, and shall possess all the powers ,
duties and obligations herein conferred on the Trustee in the
same manner and to the same extent as though it were named herein
as Trustee.
Section 11 . Rights and Duties of Beneficiaries. The
Company hereby irrevocably appoints the Beneficiary the Company ' s
Attorney-in-Fact , with full authority in the place and stead of
the Company and in the name of the Company, the Beneficiary or
otherwise, from time to time in the Beneficiary' s discretion to
take any action and to execute any instrument which the
Beneficiary may deem necessary or desirable to accomplish the
purposes of this Deed of Trust . If the Company shall fail to
perform any agreement contained herein, the Beneficiary or either
of them may perform, or cause performance of such agreement , and
the expenses of the Beneficiary incurred in connection therewith
shall be payable by the Company under Section 6 . The powers
conferred on the Beneficiary hereunder are solely to protect
their interest in the Trust Estate and shall not impose any duty
upon the Beneficiary to exercise any such powers. Except for the
accounting for monies actually received by them hereunder, the
Beneficiary shall have no duty as to the Trust Estate or as to
the taking of any necessary steps to preserve their rights
against prior parties or any other rights pertaining to the Trust
Estate.
Section 12. Miscellaneous.
(a) Notices. All notices, approvals, consents, requests
and other communications hereunder shall be in writing and,
unless otherwise provided herein, shall be deemed to have been
given when delivered by hand or on the third day following the
day on which the same has been mailed by registered or certified
mail, return receipt requested, postage prepaid, addressed as
follows: (a) if to the Company at Isotechnologies, Inc. , F.O.
Box 640, 501 S. Greensboro Street, Building B, Carrboro, North
Carolina 27510, Attention: President, (b) if to the Beneficiary
at The Orange County Industrial Facilities and Pollution Control
Financing Authority, 110 North Churton Street, Hillsborough,
North Carolina 27510, Attention: County Attorney, (c) if to the
Holder, at NCNB National Bank of North Carolina, P.O. Box 570,
Chapel Hill, North Carolina 27514, Attention: Mr . Randy
Dickerson, or (d) if to the Trustee, to , at NCNB
National Bank of North Carolina, One NCNB Plaza, Charlotte, North
Carolina 28233. All notices hereunder delivered or mailed to the
Company, the Beneficiary or the Trustee shall likewise be
delivered or mailed to the Holder.
The Authority, the Company, the Trustee and the Holder may
each, by notice given hereunder, designate any further or
10.
different addresses to which subsequent notices , approvals ,
consents , requests or other communications shall be sent to it or
persons to whose attention the same shall be directed.
(b) Successors and Assigns. This Deed of Trust shall be
binding upon, inure to the benefit of and be enforceable by the
parties hereto and their respective successors and assigns .
(c) Amendments and Supplements. This Deed of Trust may be
amended and supplemented only as provided in the Bond Purchase
Agreement.
(d) Applicable Law. This Deed of Trust shall be governed
by and construed in accordance with the laws of the State of
North Carolina.
(e) Execution in Counterparts. This Deed of Trust may be
executed in several counterparts, each of which shall be an
original and all of which shall constitute but one and the same
instrument.
(f) Severability. In the event any provision of this Deed
of Trust shall be held invalid or unenforceable by any court of
competent jurisdiction, such holding shall not invalidate or
render unenforceable any other provision hereof.
IN WITNESS WHEREOF, the Company has caused this Deed of
Trust to be executed in its name and its seal to be affixed
hereto by its duly authorized officers.
• ISOTECHNOLOGIES, INC.
President
[SEAL]
Attest:
Secretary
11.
. r
STATE OF NORTH CAROLINA)
ss . :
COUNTY OF ORANGE
I , the undersigned Notary Public, certify that
personally came before me this day and acknowledged that he is
the President of Isotechnologies , Inc. a North Carolina corpor-
ation, and that by authority duly given and as the act of the
corporation, the foregoing instrument was signed in its name by
him.
Witness my hand and official seal, this day of July,
1986 .
Notary Public
(SEAL) Commission Expires:
12 .
{
STATE OF NORTH CAROLINA)
ss . :
COUNTY OF ORANGE
I , the undersigned Notary Public, certify that
personally came before me this day and acknowledged that
he is Secretary of Isotechnologies, Inc. , a North Carolina cor-
poration, and that as an act of said corporation he affixed its
corporate seal to the foregoing instrument and attested it .
Witness my hand and official seal, this _ day of July, 1986 .
Notary Public
( SEAL) Commission Expires:
13 .
Draft : 6/9/86
SECURITY AGREEMENT
THIS SECURITY AGREEMENT, dated as of July 1, 1986 ( the "Sec-
urity Agreement" ) , by and between ISOTECHNOLOGIES, INC. , a cor-
poration duly organized and existing under the laws of the State
of North Carolina (the "Company" ) , and THE ORANGE COUNTY INDUS-
TRIAL FACILITIES AND POLLUTION CONTROL FINANCING AUTHORITY, a
political subdivision and body corporate and politic of the State
of North Carolina ( the "Secured Party" ) ,
W I T N E S S E T H:
WHEREAS, the Company has entered into a Bond Purchase Agree-
ment, of even date herewith (the "Bond Purchase Agreement" ) , with
the Secured Party and NCNB National Bank of North Carolina, a
national banking association having its principal office in
Charlotte, North Carolina (the "Purchaser" ) , which provides for
the financing by the Secured Party of the cost of the acquisi-
tion, construction and installation of the Project (as defined in
the Loan Agreement hereinafter referred to) for the Company
through (a) the issuance by the Secured Party of its industrial
revenue bond in the principal amount of $1,500,000 (the "Bond" )
in substantially the form of Exhibit A to the Bond Purchase
Agreement, (b) the Secured Party' s making a loan of the proceeds
of the Bond to the Company, evidenced by a promissory note of the
Company (the "Note") , pursuant to a Loan Agreement, of even date
herewith ( the "Loan Agreement" ) , between the Secured Party as
lender and the Company as borrower , (c) the pledge of the Note,
endorsed without recourse to the order of the Purchaser, and the
assignment of certain of the Secured Party' s rights in the Loan
Agreement and this Security Agreement, pursuant to an Assignment,
of even date herewith (the "Assignment") , by the Secured Party to
the Purchaser, its successors and any transferees of the Bond in
accordance with Section 7 of the Bond Purchase Agreement ( the
"Holder" ) to secure the Bond, (d) the grant by the Company to the
Secured Party of a security interest in certain personal property
and fixtures more particularly described herein pursuant to the
terms of this Security Agreement, as additional security for the
Note, (e) the grant by the Company to , as trustee
for the benefit of the Secured Party, of a deed of trust on cer-
tain real property more particularly described therein pursuant
to the terms of a Deed of Trust, of even date herewith (the "Deed
of Trust" ) , as additional security for the Note, (f) the uncondi-
tional guaranty of the payment of the Bond by the Company pursu-
ant to the Guaranty Agreement, of even date herewith ( the "Com-
' 4
pany Guaranty" ) , and (g) the unconditional guaranty of the pay-
ment of the Bond by Mr . and Mrs . Jerome J. Richardson pursuant to
the Guaranty Agreement, of even date herewith ( the "Personal
Guaranty" )
and
WHEREAS, the Company is indebted to the Secured Party in the
sum of $1, 500,000 for money loaned, as evidenced by, and payable
as provided in, the Note, with interest payable as and at the
rates specified therein, with the last payment of principal and
interest being due and payable on July 1, 1996; and
WHEREAS, the Company desires to secure ( i) the payment of
the principal of the Note together with interest and premium, if
any, thereon, ( ii) the payment of any and all other indebtedness
which this Security Agreement by its terms secures, and ( iii) the
performance of the covenants and agreements contained in this
Security Agreement, the Loan Agreement, the Note, the Deed of
Trust, and the Bond Purchase Agreement and any amendments and
supplements thereto;
NOW, THEREFORE, the Company, subject to Permitted Encumbran-
ces (as defined in the Loan Agreement) , as additional security
for the Note, and in further consideration of the sum of $1 .00
paid to the Company by the Secured Party, receipt and sufficiency
of which are hereby acknowledged, hereby grants and assigns to
the Secured Party, its successors and any subsequent Holder, for-
ever, a security interest in the following property (collective-
ly, the "Collateral" ) :
( i) all tangible personal property including, without
limitation, machinery, equipment and fixtures, whether now
owned or hereafter acquired, located or to be located on or
about the premises described in Schedule I hereto (the "Pro-
ject Site" ) , including, but not limited to, all substitutes,
renewals or replacements of, and additions, modifications,
improvements, accumulations and accessions to, such property
or any portion thereof, whether pursuant to Section 6.1 of
the Loan Agreement or otherwise, less all removals therefrom
effected in accordance with Section 3 hereof, and excluding
only buses, motor coaches, automobiles, trucks, tractor-
trailers and other titled vehicles; and
( ii) the proceeds of any insurance and any property
covered by clause (i) above which may be sold or otherwise
disposed of pursuant to the terms hereof.
In furtherance of the grant hereinabove set forth the Com-
pany, for itself, its successors and assigns, covenants and
agrees with the Secured Party as follows:
2.
Section 1 . Defeasance. The Company represents and warrants
to the Authority that it is, or at the time of acquisition will
be, the holder of marketable title to the Collateral free and
clear of any liens, security interests and encumbrances other
than Permitted Encumbrances (as defined in the Loan Agreement ) .
If the Company shall pay the Note secured hereby in accordance
with its terms, together with interest thereon and premium, if
any, and all taxes, charges, assessments and any premiums for in-
surance hereby secured, and, further, shall comply with all the
covenants, terms and conditions of this Security Agreement, the
Bond Purchase Agreement, the Loan Agreement, the Note, the Deed
of Trust and the Company Guaranty and any amendments and supple-
ments thereto, then this Security Agreement shall be null and
void and may be cancelled of record at the request and at the
cost of the Company.
Section 2. Maintenance and Modification of Collateral by
Company. The Secured Party shall not be under any obligation to
operate, maintain or repair the Collateral. The Company agrees
that until Payment of the Bond (as defined in the Loan Agreement)
shall be made it will at its own expense ( i ) keep the Collateral
in as reasonably safe condition as its operations shall permit,
( ii) keep the Collateral in good repair and in good operating
condition, and (iii) make from time to time all necessary repairs
thereto and renewals and replacements thereof. The Company shall
not permit or suffer others to commit a nuisance in or about the
Project Site or itself commit a nuisance in connection with its
use or occupancy of the Project Site.
The Company may, also at its own expense, make from time to
time any additions, modifications or improvements to the Collat-
eral that it may deem desirable for its business purposes and
that do not materially impair the effective use, nor materially
decrease the value, of the Collateral. All such additions, modi-
fications and improvements so made by the Company shall become a
part of the Equipment Collateral. The Company will pay any rea-
sonable cost (including the attorneys' fees) incurred in subject-
ing such property to the lien of this Security Agreement.
Section 3. Removal of Equipment. In any instance where the
Company in its sole discretion determines that any items of Col-
lateral have become inadequate, obsolete, worn-out, unsuitable,
undesirable or unnecessary, the Company may remove such items of
Collateral from the Project Site and sell, trade in, exchange or
otherwise dispose of such items (as a whole or piecemeal) , pro-
vided that the Company shall, without impairing the operating
unity of the Collateral, either :
(a) substitute and install anywhere on the Project
Site other machinery, equipment or related property having
3.
equal or greater utility ( but not necessarily having the
same function) , and having an equal or greater value in the
operation of the Collateral, all of which substituted mach-
inery, equipment or related property shall be free of all
liens and encumbrances other than Permitted Encumbrances (as
defined in the Loan Agreement) , and shall become a part of
the Collateral; or
(b) if it shall not make any such substitution and in-
stallation, pay to the Secured Party as a prepayment of the
Note ( i) in the case of the sale of any such items of Col-
.
lateral to anyone other than itself or a corporate affiliate
of the Company or in the case of the scrapping thereof, the
proceeds from such sale or scrapping, ( ii) in the case of
the trade-in of any such items of Collateral, the amount of
the credit received by it in such trade-in, and ( iii) in the
case of the sale to itself or a corporate affiliate of the
Company of any such items of Collateral or in the case of a
disposition thereof not specifically mentioned in clauses
( i) , ( ii) or ( iii) hereof, an amount equal to the value
thereof, all in accordance with the provisions of the last
paragraph of this Section.
The removal from the Project of any items of Collateral pursuant
to the provisions of this Section 3 shall not entitle the Company
to any abatement or diminution of its obligations under the Note.
The Company shall file a report with the Secured Party and
the Holder annually, on July 1, 1986, and on each July 1 there-
after, describing generally each such removal, substitution,
sale, scrapping, trade-in or other disposition of any item of
Collateral having a value of more than $10, 000 and shall make any
and all payments required by subsection (b) of this Section 3
within 30 days after filing such report; provided, however, that
no such payment need be made until the aggregate amount to be
paid to the Holder, determined from the annual reports mentioned
above, on account of all such sales, scrappings, trade-ins or
other dispositions of items having a value of more than $10,000
for which payments have not yet been made equals at least
$50,000, at which time the Company shall, pay as provided above an
amount equal to the aggregate value of such items. The amount so
paid shall be deemed an optional prepayment of the Note and
applied in accordance with Section 10.1(a) of the Loan Agreement.
The Company will not remove, or permit the removal of, any of the
Collateral except in accordance with the provisions of this
Section 3.
For purposes of this Section, the determination of the
"value" of any item of Collateral shall be an amount equal to the
original cost thereof less straight line depreciation calculated
4.
in accordance with generally accepted accounting principles
applied on a consistent basis .
Section 4 . Remedies of the Secured Party Dpon Default:
(a) If any of the following events shall occur :
( i) default in the payment or any of the other
terms or conditions of the Note secured hereby and the
expiration of any applicable grace or notice periods
provided thereby;
( ii) failure by the Company to observe and perform
any covenant, condition or agreement on the part of the
Company under this Security Agreement other than Sec-
;, tion 6 hereof for a period of 30 days after written
notice specifying such failure and requesting that it
be remedied is given to the Company by the Secured
Party unless the Secured Party shall agree in writing
to an extension of such time prior to its expiration;
provided, however, that if the failure stated in the
notice cannot be reasonably corrected within the appli-
cable period, such period shall be extended for the
period of time reasonably required to correct such
failure provided the Company promptly commences and
diligently pursues the curing thereof;
•
(iii ) default in any of the terms, conditions or
covenants contained in the Bond Purchase Agreement , the
Loan Agreement, the Assignment, the Bond, the Deed of
Trust, the Company Guaranty, the Personal Guaranty or
any amendments and supplements thereto and the expira-
tion of any applicable grace or notice periods provided
thereby; or
( iv) any lien, charge or encumbrance prior to or
affecting the validity of this Security Agreement is
found to exist, other than Permitted Encumbrances, or
proceedings be instituted to enforce any lien, charge
or encumbrance against any of said Collateral and such
lien, charge or encumbrance would be prior to the lien
of this Security Agreement;
then and in any of such events (hereinafter referred to as an
"event of default" ) the Note shall, at the option of the Secured
Party, become at once due and payable, regardless of the maturity
date thereof.
(b) If an event of default shall have occurred, the
Secured Party may require the Company to assemble the Col-
5.
lateral and to make it available to the Secured Party at a
place or places to be designated by the Secured Party and
proceed by suit or suits at law or in equity and exercise
any and all of the rights, powers and remedies of a secured
party as provided under the Uniform Commercial Code of North
Carolina, as set forth in Article IX of Chapter 25 of the
General Statutes of North Carolina, as amended, or by any
other appropriate remedy, to protect and enforce its rights
hereunder, whether for the specific performance of any cove-
nant or agreement contained herein, or for an injunction
against the violation of any of the terms hereof, or in aid
of the exercise of any right, power or remedy available to
it, or to enforce the payment of the principal of and inter-
est on the Note, or to foreclose the security interest cre-
ated by this Security Agreement as against all or any part
of the Collateral and to have all or any part of the Collat-
eral sold as hereinafter provided or otherwise, in any man-
ner permitted by law. The Secured Party may, and it is
hereby authorized and empowered to, demand that the Company,
and upon such demand the Company shall, permit the Secured
Party to hold, operate and manage the Collateral, and from
time to time make all needful repairs and improvements as
shall be deemed expedient by the Secured Party; and the Sec-
ured Party may lease any part of the Collateral in the name
of and for the account of the Company, and collect, receive
and sequester the rent, revenues, receipts, earnings, in-
come, products and profits therefrom, and out of the same
and from any moneys received from any receiver of any part
thereof pay, and set up proper reserves for the payment of,
all proper costs and expenses of so taking, holding and man-
aging the same, including reasonable compensation to the
Secured Party, its agents and counsel, and any charges of
• the Secured Party hereunder, and any taxes and assessments
and other charges having priority over the security interest
created by this Security Agreement which the Secured Party
may deem it proper to pay, and all expenses of such repairs
and improvements, and apply the remainder of the moneys so
received in accordance with the provisions hereof. At the
request of the Secured Party, the Company shall promptly
execute and deliver to the Secured Party such instruments of
title and other documents which are necessary to enable the
Secured Party or an agent or representative designated by
the Secured Party, at such time or times and place or places
as the Secured Party may specify, to obtain possession of
all or any part of the Collateral. If the Company shall for
any reason fail to execute and deliver such instruments and
documents after such request by the Secured Party, the Sec-
ured Party may obtain a judgment conferring on the Secured
Party the right to such possession immediately and requiring
the Company to deliver such instruments and documents to the
6 .
Secured Party, to the entry of which judgment the Company
hereby specifically consents .
(c) The Secured Party shall have the right to assign
to any other person, for lawful consideration, any rents,
revenues, earnings, income, products and profits receivable
under this Security Agreement, provided that the proceeds of
any such assignment shall be applied in this Security Agree-
ment .
(d) If an event of default shall have occurred, the
Secured Party may sell, assign, transfer and deliver the
whole or, from time to time, any part of the Collateral, or
any interest in any part thereof, at any private sale or by
public auction, with, or if permitted by applicable law
without, demand, advertisement or notice of the time or
place of sale or adjournment thereof or otherwise, for cash,
on credit or for other property, for immediate or future de-
livery, and for such price or prices and on such terms as
the Secured Party in its sole discretion may determine, or
as may be required by applicable law. If, pursuant to
applicable law, prior notice of such sale is required to be
given to the Company, the Company hereby acknowledges that
the minimum time required by such applicable law, or if no
minimum is specified, one week, shall be deemed reasonable
notice.
Upon the sale of the Collateral or any part thereof or
any interest therein, whether pursuant to foreclosure, power
of sale or otherwise, the purchaser shall acquire good title
thereto, free of the security interest granted by this Sec-
urity Agreement and free of all rights of redemption, whe-
ther statutory, equitable or otherwise, in the Company to
the extent permitted by applicable law. The sale of the
Collateral or any part thereof or any interest therein, whe-
ther pursuant to foreclosure, power of sale or otherwise
under this Security Agreement, shall forever bar any claim
with respect thereto by the Company. The receipt of the
officer making the sale under judicial proceedings or of the
Secured Party shall be sufficient discharge to the purchaser
for the purchase money, and such purchaser shall not be
obligated to see to the application thereof. The Secured
Party may be a purchaser of the Collateral or any part
thereof or any interest therein at any sale thereof, whether
pursuant to foreclosure, ower of
sale or
e
P otherwise,
and may the indebtedness secured hereby to the y
y purchase price.
(e) The Company hereby waives, to the full extent it
may lawfully do so, the benefit of all appraisement, valua-
tion, stay, moratorium, exemption from execution, extension
7.
Wit:_,
and redemption laws and any statute of limitations, now or
hereafter in force, and all rights of marshalling in the
event of the sale of the Collateral or any part thereof or
any interest therein.
(f) Each legal, equitable or contractual right, power
or remedy of the Secured Party now or hereafter provided
herein or by statute or otherwise shall be cumulative and
concurrent and shall be in addition to every other right ,
power and remedy, and the exercise or beginning of the exer-
cise by the Secured Party of any one or more of such rights ,
powers and remedies shall not preclude the simultaneous or
later exercise of any or all such other rights, powers and
remedies.
Section 5. Application of Proceeds. The proceeds of (a)
the operation and management of the Collateral pursuant to Sec-
tion 4 hereof, (b) any sale of the Collateral or any part thereof
or any interest therein, whether pursuant to foreclosure, power
of sale or otherwise, and (c) any insurance policies or Eminent
Domain (as such term is defined in the Loan Agreement) awards or
other sums (other than awards or sums to which the Company is en-
titled to under the Loan Agreement) retained by the Secured Party
upon the occurrence of an event of default shall be applied to
pay:
First : The costs and expenses of the sale, reasonable
attorneys ' fees, the Secured Party's fees and expenses,
court costs and any other expenses or advances made or in-
curred in the protection of the rights of the Secured Party
or in the pursuance of any remedies hereunder;
Second: Any indebtedness secured by this Security
Agreement and at the time due and payable (whether by accel-
eration or otherwise) , including all amounts of principal
and interest at the time due and payable with respect to the
Note, and interest on any overdue principal of, and ( to the
extent permitted by applicable law) interest on the Note at
a rate per annum equal to the Alternative Rate of Interest
(as defined in the Loan Agreement) ; and
Third: The balance, if any, to the persons then en-
titled thereto under the Loan Agreement.
Section 6. General Covenant. The Company shall pay the
principal of and premium, if any, and interest on the Note and
shall observe and perform all covenants, conditions and agree-
ments contained in the Note, and any amendments and supplements
thereto.
8.
Section 7. Payment of Costs, Attorneys' Fees and Expenses.
As between the Secured Party and the Company, the Company shall
pay any and all costs, attorneys ' fees and other expenses of
whatever kind incurred by the Secured Party or other holders of
the Note in connection with (a) obtaining possession of the Col-
lateral, (b) the operation, management, protection and preserva-
tion of the Collateral, (c) the collection of any sum or sums
secured hereby, (d) any litigation involving the Collateral, the
lien created hereunder, any benefit accruing by virtue of the
provisions hereof, or the rights of the Secured Party, (e) the
presentation of any claim under any administrative or other pro-
ceeding in which proof of claim is required by law to be filed,
(f) any additional examination of the title to the Collateral
which may be reasonably required by the Secured Party, or (g)
taking any steps whatsoever in enforcing this Security Agreement,
claiming any benefit accruing by virtue of the provisions hereof,
or exercising the rights of the Secured Party hereunder.
Section 8. Insurance and Taxes. Pursuant to Sections 7.7
and 6. 2 of the Loan Agreement, the Company will obtain and main-
tain certain insurance and will pay all lawful taxes, assessments
and charges at any time levied or assessed upon or against the
Collateral or any part thereof; provided, however, that nothing
contained in this Security Agreement shall require the mainten-
ance of insurance or the payment of any such taxes, assessments
or charges if the same are not required to be paid under Sections
7.7 and 6. 2 of the Loan Agreement.
Section 9. No Assignment of Collateral. The Company will
make no assignment, lease or sale of the Collateral or any part
thereof without the prior written consent of the Secured Party,
except as provided in Section 8.1 of the Loan Agreement or Sec-
tion 3 hereof.
Section 10 . Advances by Secured Party. The Secured Party
or other holders of the Note are authorized, for the account of
the Company, to make any required payments under any lien prior
hereto, or under this Security Agreement, the non-payment of
which would constitute a default, including but not limited to
principal payments, interest payments, premium payments, if any,
taxes and insurance premiums. All sums so advanced shall attach
to and become part of the debt secured hereby, shall become pay-
able at any time on demand therefor and, from the date of the
advance to the date of repayment, any sum so advanced shall bear
interest at a rate per annum equal to the Alternative Rate of In-
terest (as defined in the Loan Agreement) . The failure to make
payment on demand shall, at the option of the Secured Party or
other holders of the Note, constitute a default hereunder, giving
rise to all of the remedies herein provided for an event of de-
fault. The Secured Party or other holders of the Note, as the
9.
case may be, shall notify the Company in writing of any such ad-
vance within 30 days of the date thereof; provided, however , that
the failure to so notify shall not impair any rights of the Sec-
ured Party or other holders of the Note under this Security
Agreement .
The Secured Party or other holders of the Note may grant any
extension, forbearance or other indulgence, may release any part
of the Collateral from the lien hereof and may release any person
from liability without affecting the personal liability of any
person for payment of indebtedness secured hereby or the lien
hereof.
Section 11. Miscellaneous. •
(a) Notices. All notices, approvals, consents, requests
and other communications hereunder shall be in writing and, un-
less otherwise provided herein, shall be deemed to have been
given when delivered by hand or on the third day following the
day on which the same has been mailed by registered or certified
mail, return receipt requested, postage prepaid, addressed (a) if
to the Company, at Isotechnologies, Inc. , P.O. Box 640, 501 S.
Greensboro Street, Building B, Carrboro, North Carolina 27510,
Attention: President, or (b) if to the Secured Party, at ( i) The
Orange County Industrial Facilities and Pollution Control Financ-
ing Authority, 110 North Churton Street, Hillsborough, North
Carolina 27278, Attention: County Attorney, and (ii) NCNB
National Bank of North Carolina, P.O. Box 570, Chapel Hill, North
Carolina 27514, Attention: Mr . Randy Dickerson.
The Company and the Secured Party may, by notice given here-
under, designate any further or different addresses to which sub-
sequent notices, approvals, consents, requests or other communi-
cations shall be sent or persons to whose attention the same
shall be directed.
(b) Successors and Assigns. This Security Agreement shall
be binding upon, inure to the benefit of and be enforceable by
the parties hereto and their respective successors and assigns.
(c) Amendments and Supplements. This Security Agreement
may be amended and supplemented only as provided in the Bond Pur-
chase Agreement.
(d) Applicable Law. This Security Agreement shall be gov-
erned by and construed in accordance with the laws of the State
of North Carolina.
(e) Execution in Counterparts. This Security Agreement may
be executed in several counterparts, each of which shall be an
10 .
original and all of which shall constitute but one and the same
instrument.
( f) Severability. In the event any term, provision or
covenant herein contained or the application thereof to any cir-
cumstances or situation shall be invalid or unenforceable in
whole or in part, the remainder hereof and the application of
said term or provision or covenant to any other circumstances or
situation shall not be affected thereby, and every other term,
provision or covenant herein shall be valid and enforceable to
the full extent permitted by law.
IN WITNESS WHEREOF, the Secured Party and the Company have
caused this Security Agreement to be executed in their respective
names and their respective seals to be affixed hereto by duly
authorized officers.
ISOTECHNOLOGIES, INC.
By:
President
Attest:
Secretary
[Seal]
•
11 .
THE ORANGE COUNTY INDUSTRIAL
FACILITIES AND POLLUTION CONTROL
FINANCING AUTHORITY
By:
Chairman
Attest:
Secretary
[Seal ]
IJA
rft:
12.
,`i
ORANGE COUNTY
BOARD OF COMMISSIONERS Action Agenda
ACTION AGENDA ITEM ABSTRACT Item No.
Meeting Date: JUNE 24, 1986
SUBJECT: POLICY REGARDING PROCLAMATION ISSUANCE
DEPARTMENT: COMMISSIONERS PUBLIC HEARING: Yes X No
ATTACHMENT(S) : INFORMATION CONTACT: DON WILLHOIT
X505
TELEPHONE NUMBER:
Hillsborough - 732-8181
Chapel Hill - 968-4501
Mebane - 227-2031
Durham - 688-7331
PURPOSE: To consider establishing policy whereby the authority to issue
proclamation can be clarified.
NEED: Unlike contracts, proclamations are s
do not have the effect of binding the County declarations
They
are usually written by the sponsors of a function. They serve
the purpose of drawing attention to an event or observance that
is taking place in the community at a particular time. In this
sense a proclamation serves as a form of publicity for the
event.
Because of the number of proclamations brought forth by commu-
nity groups and their non-binding content many cities have
authorized their mayors to sign them without appearing on an
agenda.
Issues brought up with regard to the issuance of the Anti
Discrimination Proclamation were:
1. Whether the Chair of the Board had authority to sign the
proclamation.
2. Whether citizens of the County thought it was coming from
the Board.
Since proclamations are not specifically addressed in the
Board's Rules and Procedure Guide clarification of responsibi
lity and procedure for proclamation issuance is needed.
RECOMMENDATION(S) :
As the Board decides.
PROCLAMATION
•
WHEREAS, democracies cannot exist without protecting their
citizens from persecution and discrimination because of
race, religion, national origin, gender, or affectional
orientation; and whereas the very basis of democracy is
the right of all people to dignity and self respect;
WHEREAS, toleration of diversity is essential for a decent and
democratic society;
WHEREAS, lesbians and gay men often face discrimination in hous-
ing, employment, immigration policy, child custody, and
many other parts of their lives;
WHEREAS, lesbians and gay men are often targets of harassment,
intimidation and violent attack merely because of their
affectional orientation;
WHEREAS, all people have the right to love and live free from
bigotry, violence, and fear, in the workplace, the
family, the streets of our community, our places of
worship and play, our hospitals and clinics, our
schools, and the privacy of our homes;
WHEREAS, lesbians and gay men contribute greatly as citizens to
the political , spiritual , artistic and civic life of
our county, state and nation;
•
NOW, THEREFORE, I , Don Willhoit, Chair of the Orange County Board
of Commissioners, proclaim the week of June 22-29
ANTIDISCRIMINATION WEEK
Don Willhoit, Chair
_
'
'
.
W'8E&T mmMria oDiuon pW lbna itpr,uCiM eud f
1
discrimination Week; and th=e
0 a u� ot_y
Bord u
. of
oti-
wscoDxS the opening statement of the Proclamation is to be affirmed
as one definition of American democracy, and can be affirmed
as a proclamation against discrimination; and
WHEREAS the remainder of the proclamation is in itself discrimin-
atory because it is based on "affectional uceimtutiwn" rather
than citizenship or civil rights; and
WHEREAS we, the undersigned United Methodist Ministers of Orange
^affirm our Church's statement that "homosexual p-conna '
sacred
c
worth, who need the ministry and guidance of the Church ��
their struggles for human fulfillmeot ao,wnll as the spirit-
ual �o
uml und emotional care of a fellowship e�which enables
-
ciling relationships with Cod, with others and wi re�on-
Further we insist that all persons are e»c� cn self.
human and civil rights ensured ��l*d to have their
the practice of homosexuality , �h»«�� we do not condone
^u� �y
incompatible with Christian an� consider this ra��i�m
Discipline of the F ��znn �e��bin�-" (paragraph 71 The
e u
n Methodist Church, 1984.) ; and
WHEREAS we believe that all proclamations of
should represent a majority vote of that agency government agency
aWencY to insure the
democratic process;
`
�
' THEREFORE BE IT RESOLVED that' of Orange County, wc the undersigend tax-paying citizens
to review and consider cequeu� the Orange County Board of Commissioners
discrimination »o^z«uc nr. Willboit"a proclamation on Anti-
' oo nnu publish its response; and
BE IT FURTHER RESOLVED that the Orange�b cvwnty Board of Commissioners
establish a process whereby
procla-
mations as a part of the i��= Board «6all� approve all Pcoula-
m=e�in�u, If this resolution is of its regular public
^« o » opposition to current by-laws
of the Orange County Board of n i
' ~uu="i"s^"»era' we request that
those by-laws be changed.
. uev�� D. 0`K�ef
/
/ -~'`
Re '
WAIL: "
uev' m w��zzo ��
. Boykin
1 W�
-
/ -
-�m�-.
Bm v^ P 1 -��
ip R. Maynard
\ - '—'
~- �� ^ �� �wr~---__�
Rev. Brian K. Adzms
'
��
/it
Rev. 'obert--
' ' "vrg'
°�v�
^`^, . .~ ~�ik Thomason
.
����N
•
PROCLAMATION
WHEREAS, democracies cannot exist without protecting their
citizens from persecution and discrimination because of
race, religion, national origin, gender, or affectional
orientation; and whereas the very basis of democracy is
the right of all people to dignity and self respect;
WHEREAS, toleration of diversity is essential for a decent and
democratic society;
WHEREAS, lesbians and gay men often face discrimination in hous-
ing, employment, immigration policy, child cu
many other parts of their lives; custody, and
WHEREAS, lesbians and gay men are often targets of harassment,
intimidation and violent attack merely because of their
affectional orientation;
WHEREAS, all people have the right to love and live free from
bigotry, violence, and fear, in the workplace, the
family, the streets of our community, our places of
worship and play, our hospitals and clinics, our
schools, and the privacy of our homes;
WHEREAS, lesbians and gay men contribute greatly as citizens to
the political, spiritual , artistic and civic life of
our county, state and nation;
NOW, THEREFORE, I , Don Willhoit, Chair of the Orange County Board
of Commissioners, proclaim the week of June 22-29
ANTIDISCRIMINATION WEEK
f ,
•
Don Willhait, . Chair
•
•
PROCLAMATION
WHEREAS, democracies cannot exist without protecting their
citizens from persecution and discrimination because of
race, religion, national origin, gender, or affectional
orientation; and whereas the very basis of democracy is
the right of all people to dignity and self respect;
WHEREAS, toleration of diversity is essential for a decent and
democratic society;
WHEREAS, lesbians and gay men often face discrimination in hous-
ing, employment, immigration policy, child custody, and
many other parts of their lives;
WHEREAS, lesbians and gay men are often targets of harassment,
intimidation and violent attack merely because of their
affectional orientation;
WHEREAS, all people have the right to love and live free from
bigotry, violence, and fear, in the workplace, . the
family, the streets of our community, our places of
worship and play, our hospitals and clinics, our
schools, and the privacy of our homes;
WHEREAS, lesbians and gay men contribute greatly as citizens to
the political , spiritual , artistic and civic life of
our county, state and nation;
NOW, THEREFORE, I , Don Willhoit, Chair of the Orange County Board
of Commissioners, proclaim the week of June 22-29
ANTIDISCRIMINATION WEEK
Don Willhoit, Chair
Church of God
509 Eno Street
P. 0. Box 575
Hillsborough, N.C. 27278
Currie Parker,Minister
Awl_hone 732-7212 �,- G1aze,Jr. Clerk
`/" / 9� /
,� - /
1 / r
PETITION
rip ' Ckv-5• Q
- 1-11-��y'-'/ry BE IT HEREBY KNOWN THAT WE, THE MEMBERS AND FRIENDS ` , N
/i OF THE HILLSBOROUGH CHURCH OF COD, DO THIS DATE j J
�P _ , / �� JUNE 22, , "� Q � ,�/Q�7t�-�
, 1986 AF l v
/ IX OUR SIGNATURES AS AN EXPRESSION
/
OF CUR TOTAL OPPOSITION TO THE
ANTIDISCRIMINATION" (/vv�-:(4
(9 E.
,p�.,� , WEEK, AS PROPOSED BY MR. DON WILHOIT, CHAIRMAN OF THE
'RANGE COUNTY COMMISSIONERS.
/
grit/ DO NOT BELIEVE THIS t���"- k
i PROCLAfMATION REPRESS EITHER
�,�P'p� THE MORALS OR DESIRES OF ORANGE COUNTY CHRISTIANS
^'"-__ 71/".. .. NOR
OTHER COMMISSIONERS. - IT -MOST CERTAINLY DOES NOT REPRE-
SENT THE HILLSBOROUGH CHURCH OF GOD AND ITS CONSTITUENCY., ,
Air A at 4 9-tafze ci(a9 is. . .
- 4,, -,p
,.. .., ,,,, ,,
,/ _ if, „ ,- i_,,,t,
_ v'/ • J �a
_ 11 „4 � V
ae,i_zz aa. "-e---)z) r .1
1/4.7ov.„ `--1 :1 ,,,,,
pcdc ecGt_,v...4., ( -0,-1,-_ (...../LtAiicry7,--c
A '1 1_,..0..e I r//E ii .k b z.L.1 86,,,„, tZ • t illt
P
1 i(iLLAIL42/ 84124) f/. /72 junitletuto„C-12-472/2
ei‘2,e/--- 4AintAALi a41-6.-,j
ti/?0,
d aiti-0 i Am
ca' 1 e ae,-- -- 4d46...:,,)
-il,,,,z,-,-A.. ivt.c.„ 7= w
NAME
�ct ITEM
/3• Cie .'/fir R k,L/ 2 _ /14 4 Te/e CPC! r/= 5J
•
•S /M1. CiCa1c L'C). /,V(
7. % Gtd.ej)9- a4/6
8.
i — IiliaT
�9• I• � .mac ice. t.-1. - . . _ '
2 1-G,�t�°�C m.0 —
/_,� jai r - g r ,
14.
16.
17.
18.
19.
20,
z2_
23.
24.,
25.
26.
27.
28.
29.
30. --
31.
32.
33.
34.
35.
36.
37.
38.
39.
40. ��
(19)
THE BOARD OF COMMISSIONERS
FOR
THE COUNTY OF .O RANGE, NORTH CAROLINA
The Board of Commissioners for the County of Orange, North
Carolina, met in special session in the Board Room of Lincoln
Center in Carrboro, North Carolina, at 7:30 P.M. , June 24, 1986.
Present: Chairman Don Willhoit
presiding, and
Commissioners Marshall, Care , Llo d and Walker
Absent: None
Also present: Geoffrey E. Gledhill, Orange County Attorney;
Count Mana er Kenneth R. Thom son Assistant Co
Albert Kittrell, Clerk to the Board Beverl A. BI M 111rso T_ 1 awe y
Whitehead. Y ythe and Director of Personnel Beverly
* 7C
Commissioner Moses ;ntroduced the following resolution,
a copy of which had been distributed to each Commissioner and the
title of which was read:
RESOLUTION APPROVING THE ISSUANCE BY THE ORANGE COUNTY
INDUSTRIAL FACILITIES AND POLLUTION CONTROL FINANCING
AUTHORITY OF ITS INDUSTRIAL REVENUE BOND
( ISOTECHNOLOGIES, INC. PROJECT) IN A PRINCIPAL AMOUNT
NOT TO EXCEED $1, 500, 000 TO FINANCE AN INDUSTRIAL
PROJECT FOR ISOTECHNOLOCIES, INC.
BE IT RESOLVED by the Board of Commissioners for the County
of Orange:
Section 1. The Board of Commissioners has determined and
does hereby declare as follows:
(a) The Board of Commissioners of The Orange County
Industrial Facilities and Pollution Control Financing Authority
(herein referred to as the "Authority" ) has met and has taken the
following action in connection with the proposed issuance and sale
of the Authority' s Industrial Revenue Bond ( Isotechnologies, Inc.
Project) , in a principal amount not to exceed $1, 500, 000:
1. approved the form of a Loan .Agreement, to be dated
as of July 1, 1986, by and between the Authority and
Isotechnologies, Inc. (the "Company") ;
2 . approved and authorize the endorsement without
recourse and pledge of a promissory note of the Company, to
be dated as of July 1, 1986;
3 . approved the form of an Assignment, to be dated as
of July 1, 1986, from the Authority to NCNB National Bank of
North Carolina (the "Purchaser") ;
4. authorized the borrowing under and the issuance and
performance of the Authority' s Industrial Revenue Bond
( Isotechnologies, Inc. Project) , in a principal amount not to
exceed $1, 500, 000, and direct the execution and delivery of
said Bond;
5. approved the form of the Bond Purchase Agreement, to
be dated as of July 1, 1986, by and among the Authority, the
2 .
Purchaser and the Company, providing for the issuance and
sale of the Bond;
6. approved the form of the Security Agreement, to be
dated as of July 1, 1986, by and between the Company and the
Authority;
7. approved the form of the Deed of Trust, to be dated
as of July 1, 1986, from the Company to Charles E. Harris as
trustee for the benefit of the Authority; and
8. approved the form of a Guaranty Agreement, to be
dated as of July 1, 1986, from the Company to the Purchaser.
9. approved the form of a Guaranty Agreement, to be
dated as of July 1, 1986, from Mr. and Mrs. Jerome J.
Richardson to the Purchaser.
(b) The Board of Commissioners for the County of Orange has
reviewed the action to be taken by the Board of Commissioners of
the Authority in connection with the issuance and sale of the Bond
and has made such other examination and investigation as it deems
necessary and relevant as the basis for the approval set forth
herein.
Section 2 . Pursuant to and in satisfaction of the require-
ments of Section 159C-4(d) of the General Statutes of North
Carolina, the Board of Commissioners for the County of Orange
hereby approves the issuance by the Authority of its Industrial
Revenue Bond ( Isotechnologies, Inc. Project) in a principal amount
not to exceed $1, 500, 000.
3 .
Section 3 . This resolution shall take effect immediately
upon its passage.
*
* *
Commissioner Carey moved the passage of the foregoing
resolution and Commissioner Marshall seconded the motion, and the
resolution was passed by the following vote:
Ayes: Commissioners Care , Marshall and Willhoit (Walker and
Lloyd were not resent at the time the vote was taken)
Noes: None
*
* *
I, Beverly A. Blythe, Clerk to the Board of Commissioners for
the County of Orange, North Carolina, DO HEREBY CERTIFY that the
foregoing is a true and complete copy of so much of the
proceedings of the Board of Commissioners for said County at a
special meeting held on June 24, 1986, as relates in any way to
the approval hereinabove set forth.
I DO HEREBY FURTHER CERTIFY that notice of said meeting of
said Board of Commissioners, signed by the Chairman of said Board
and stating that a special meeting of said Board would be held at
7:30 P.M. on June 24, 1986, in the Board Room of Lincoln Center in
Carrboro, North Carolina, concerning the passage of a resolution
approving the issuance by the Orange County Industrial Facilities
and Pollution Control Financing Authority of its not to exceed
$1, 500, 000 Industrial Revenue Bond (Isotechnologies, Inc.
Project) , was, at least 48 hours before said meeting, delivered
4.
to each Commissioner or left at his or her usual dwelling place
and, at least forty-eight hours before said meeting, posted on the
principal bulletin board of said Board and mailed or delivered to
each newspaper, wire service, radio station, television station
and person that had filed with me a written request for notice
pursuant to G. S. 143-318. 12 .
WITNESS my hand and the common seal of said County, this 24th
day of June, 1986.
Clerk to the Board of Commissioners
(Seal]
5 .
(6)
THE ORANGE COUNTY INDUSTRIAL FACILITIES
AND POLLUTION CONTROL FINANCING AUTHORITY
The Board of Commissioners of The Orange County Industrial
Facilities and Pollution Control Financing Authority met in the
Conference Room of the Orange County Public Library, Tryon Street
in Hillsborough, North Carolina, at 2 :00 P.M. , on June 24, 1986.
Present: Chairman Don Willhoit presiding, and
Commissioners: Carey, Marshall, Lloyd and Walker
Absent: Commissioners None.
Also Present: Geoffrey E. Gledhill, County Attorney;
County Manager Kenneth R. Thompson, Assistant County Managers William T. Laws.and Albert
Kittrelr, Clerk to the Board Beverly A. Blythe and Director of Personnel Beverly Whitehead.
Moses Carey presented the following documents in
connection with the proposed issuance by the Authority of its
Industrial Revenue Bond ( Isotechnologies, Inc. Project) (the
"Bond" ) in a principal amount not to exceed $1,500,000:
(a) a form of Bond. Purchase Agreement, dated as of July
1, 1986 (the "Bond Purchase Agreement" ) , by and among the
Authority, Isotechnologies, Inc. (the "Company") , and NCNB
National Bank of North Carolina (the "Purchaser") , with the
form of the bond (the "Bond") attached as Exhibit A thereto;
(b) a form of Loan Agreement, dated as of July 1, 1986
(the "Loan Agreement") , by and between the Authority and the
Company, with the form of the promissory note (the "Note"
attached as Exhibit A thereto; )
�� (c) a form of Assignment, dated as of July 1, 1986 (the
Assignment" ) , from the Authority to the Purchaser;
(die a form of Security Agreement, dated as of July 1,
1986
(the "Security Agreement") , by and between the Company
and the Authority; and
(e) a form of Deed of Trust Agreement; dated as of July
1, 1986 (the "Deed of Trust") from the Company to Charles E.
Harris as trustee for the benefit of the Authority.
(f) a form of Guaranty Agreement, dated as of July 1,
1956 (the "Company Guaranty" ) , from the Company to the
Purchaser.
(g) a form of Guaranty Agreement, dated as of July 1,
1986 (the "Personal Guaranty" ) , from Mr. and Mrs. Jerome J.
Richardson to the Purchaser.
The documents presented were delivered to the Secretary of the
Authority and directed to be marked Exhibits A, B, C, D, E, F and
G respectively, and were made a part of the permanent records of
the Authority.
Moses Carey introduced the following resolution, the
title of which was read aloud:
RESOLUTION APPROVING AND AUTHORIZING THE ISSUANCE OF A
NOT TO EXCEED $1, 500, 000 INDUSTRIAL REVENUE BOND
(ISOTECHNOLOGIES, INC. PROJECT) OF THE AUTHORITY;
APPROVING THE FORM AND AUTHORIZING THE SALE OF THE BOND
PURSUANT TO THE BOND PURCHASE AGREEMENT; APPROVING AND
AUTHORIZING THE EXECUTION AND DELIVERY OF THE LOAN
AGREEMENT, THE BOND PURCHASE AGREEMENT, SECURITY
AGREEMENT, THE DEED OF. TRUST AND THE ASSIGNMENT;
APPROVING THE FORM AND AUTHORIZING THE ENDORSEMENT AND
PLEDGE OF THE NOTE; APPROVING THE FORM OF THE COMPANY
GUARANTY AND THE PERSONAL GUARANTY; AUTHORIZING
EXECUTION AND DELIVERY OF CLOSING CERTIFICATES; AND
MAKING A TAX ELECTION, ALL IN CONNECTION WITH FINANCING
AN INDUSTRIAL PROJECT FOR ISOTECHNOLOGIES, INC.
BE IT RESOLVED by the Board of Commissioners (the "Board") of
The Orange County Industrial Facilities and Pollution Control
Financing Authority (the "Authority") :
Section 1. The Authority hereby a
in the form that has been presented to thecBoardhatLthisAmeeting,
and the Chairman or the Vice Chairman and the Secretary or any
Assistant Secretary of the Authority are hereby authorized to
execute and deliver the Loan Agreement, in any number of signed
counterparts, for and on behalf of the Authority in substantially
such form with such changes therein, additions thereto and
2 .
omissions therefrom as those executing the Loan Agreement shall
approve, their execution and delivery thereof constituting the
conclusive approval of the Authority of any changes therein,
additions thereto or omissions therefrom.
Section 2. The Authority hereby approves the form of the
Company' s promissory note, to be dated as of the date of the Loan
Agreement (the "Note") , presented to the Board at this meeting in
the form attached as Exhibit A to the Loan Agreement. The
Authority hereby authorizes the endorsement without recourse and
pledge of the Note to the Purchaser, in substantially the form of
endorsement and pledge appearing on the form of the Note, as
security for the Bond.
Section 3 . The Authority hereby approves the Assignment in
the form of that has been presented to the Board at this meeting,
and the Chairman or the Vice Chairman and the Secretary or any
Assistant Secretary of the Authority are hereby authorized to
execute and deliver the Assignment, in any number of signed
counterparts, for and on behalf of the Authority in substantially
such form with such changes therein, additions thereto and
omissions therefrom as those executing the Assignment shall
approve, their execution and delivery thereof constituting the
conclusive approval of the Authority of any changes therein,
additions thereto or omissions therefrom.
Section 4. The Authority hereby approves the Security
Agreement in the form of that has been presented to the Board at
this meeting, and the Chairman or the Vice Chairman and the
Secretary or any Assistant Secretary of the Authority are hereby
authorized to execute and deliver the Security Agreement, in any
number of signed counterparts, for and on behalf of the Authority
in substantially such form with such changes therein, additions
thereto and omissions therefrom as those executing the Security
Agreement shall approve, their execution and delivery thereof
constituting the conclusive approval of the Authority of any
changes therein, additions thereto or omissions therefrom.
Section 5. The Authority hereby approves the form of Company
Guaranty from the Company to the Purchaser with respect to the
Bond.
Section 6. The Authority hereby approves the form of
Personal Guaranty from Mr. and Mrs. Jerome J. Richardson to the
Purchaser with respect to the Bond.
Section 7. For the purpose of providing funds to finance a
portion of the cost of the acquisition of a tract of land of
approximately 20 acres located east of Hillsborough, North
Carolina on State Road 1879 or Elizabeth Brady Road near the
3 .
intersection of State Road 1879 and U. S. 70, the construction
thereon of an approximately 30, 000 square foot building and the
acquisition and installation thereon of machinery and equipment
(the "Project" ) to be used by the Company as a manufacturing
facility, the borrowing under and issuance and performance of a
revenue bond of the Authority pursuant to Section 9, Article V of
the Constitution of North Carolina and Chapter 159C of the General
Statutes of North Carolina, as amended, in a principal amount not
to exceed One Million Five Hundred Thousand Dollars
($1,500,000)hereby authorized. Said Bond shall be designated "The OOrange
County Industrial Facilities and Pollution Control Financing
Authority Industrial Revenue Bond ( Isotechnologies, Inc. Project) "
(herein referred to as the "Bond") , and the Bond shall be in
substantially the form and shall have the terms and provisions set
forth in the Bond Purchase Agreement (hereinafter mentioned) which
has been presented to the Board at this meeting,
or the Vice Chairman and the Secretary or any AssistanteSecretary
of the Authority are hereby authorized to execute and deliver the
Bond for and on behalf of the Authority in substantially such form
with such changes therein, additions thereto and omissions
therefrom as those executing the Bond shall approve, their
execution and delivery thereof constituting the conclusive
approval of the Authority of any changes therein, additions
thereto and omissions therefrom.
Section 8. The Bond shall be sold to the Purchaser pursuant
to the terms and provisions of the Bond Purchase Agreement in the
form that has been presented to the Board at this meeting. The
terms and conditions on which the Purchaser has agreed to purchase
the Bond, as set forth therein, are hereby approved and accepted;
the Authority hereby confirms its agreement to sell the Bond
bearing interest at a rate per annum (except as therein provide
equal to 70% of the Prime Rate (as defined in the Loan Agreement)
for the first six months from the date of the Bond and 65% of the
Prime Rate thereafter; provided, however, that such tax-exempt
rate of interest shall not exceed 12 .5% nor be less than 4.5%, to
the Purchaser at the purchase price of 100% of the principal
amount thereof and otherwise upon the terms and conditions set
forth in the Bond Purchase Agreement; and the Chairman or the Vice
Chairman and the Secretary or any Assistant Secretary of the
Authority are hereby authorized to execute and deliver the Bond
Purchase Agreement, in any number of signed counterparts, for and
on behalf of the Authority in substantially such form with such
changes therein, additions thereto and omissions therefrom as
those executing the Bond Purchase Agreement shall approve, their
execution and delivery thereof constituting the conclusive
approval of the Authority of any changes therein, additions
thereto or omissions therefrom, and the same are hereby further
authorized to deliver the Bond to the Purchaser upon evidence
4.
satisfactory to themselves and counsel for the Authority of
payment therefor.
Section 9. The Authority has determined to elect to have the
Bond issued pursuant to this resolution qualify for the exemption
from the provisions of paragraph
rah 6 (1) of subsection 103 (b) of the
Code afforded by subparagraph p ( ) ( ) thereof, and the Chairman or
the Vice Chairman of the Authority is hereby authorized to make
and file, or cause to be filed, such election on behalf of the
Authority by submitting a letter to such effect in a form approved
by bond counsel to the Authority.
Section 10. The officers of the Authority are hereby
authorized and directed to execute and deliver such certificates
and statements .as may be required by the Bond Purchase Agreement,
the Loan Agreement, the Security Agreement, the Deed of Trust, the
Assignment, the Company Guaranty or the Personal Guaranty or as
may otherwise be required in connection with the issuance of the
Bond, including the filing with the Internal Revenue Service of
Form 8038 of the Internal Revenue Service and the filing with the
Secretary of the Local Government Commission of the State of North
Carolina, pursuant to G. S. 159C-8, of an application for approval
of the issuance of the Bond and related matters. Such officers
are further authorized and directed to sign and to cause to be
filed such financing statements and to cause
to
instruments as counsel to the Authority shall deem necessarysorh
advisable in connection with the issuance of the Bond. Such
officers shall be entitled to rely on the advice of counsel to the
Authority in deciding to take or not to take any action in
connection with the issuance of the Bond.
Section 11. This resolution shall take effect upon its
passage.
Commissioner Moses Care
foregoing resolution entitled; moved passage of the
RESOLUTION APPROVING AND AUTHORIZING THE ISSUANCE OF A
NOT TO EXCEED $1, 500, 000 INDUSTRIAL REVENUE BOND
(ISOTECHNOLOGIES, INC. PROJECT) OF THE AUTHORITY;
APPROVING THE FORM AND AUTHORIZING THE SALE OF THE BOND
PURSUANT TO THE BOND PURCHASE AGREEMENT; APPROVING AND
AUTHORIZING THE EXECUTION AND DELIVERY OF THE LOAN
AGREEMENT, THE BOND PURCHASE AGREEMENT, THE SECURITY
AGREEMENT, THE DEED OF TRUST AND THE ASSIGNMENT;
APPROVING THE FORM AND AUTHORIZING THE ENDORSEMENT AND
PLEDGE OF THE NOTE; APPROVING THE FORM OF THE COMPANY
GUARANTY AND THE PERSONAL GUARANTY; AUTHORIZING
EXECUTION AND DELIVERY OF CLOSING CERTIFICATES; AND
5.
MAKING A TAX ELECTION, ALL IN CONNECTION WITH FINANCING
AN INDUSTRIAL PROJECT FOR ISOTECHNOLOGIES, INC.
and Commissioner Shirley Marshall seconded the motion, and the
resolution was passed by the following vote:
Ayes: Commissioners: Don Wilihoit, Shirley Marshall and Moses Carey
(Commissioners Walker and Lloyd were not present at the time the vote was taken)
Noes: Commissioners: None
*
I , Maury Klein, Secretary of The Orange County Industrial
Facilities and Pollution Control Financing Authority and keeper
of the official minutes thereof, DO HEREBY CERTIFY that the
foregoing is a true copy of certain proceedings of the Board of
Commissioners of the Authority taken at a meeting held at the
time and place noted on the front page of these excerpts of
minutes, is a complete copy of so much of the recorded minutes of
said meeting as relates in any way to the passage of the
resolution hereinabove set forth and that such resolution was
duly adopted and remains in full force and effect on the date
hereof.
I DO HEREBY FURTHER CERTIFY that, pursuant to Article II of
the by-laws of the Authority, all members of the Authority were
mailed written notice of said meeting not less than twenty-four
hours prior to the time noted on the front page of these excerpts
of minutes and that, at least forty-eight hours before said
meeting, had posted such notice on the principal bulletin board
or at the door of the usual meeting room of the Authority and had
mailed or delivered such notice to each newspaper, wire service,
radio station, television station and person that had filed with
me a written request for notice pursuant to G.S. 143-318. 12.
WITNESS my hand and the official seal of The Orange County
Industrial Facilities and Pollution Control Financing Authority,
the 24th day of June, 1986 .
Secretary
(Seal)
6 .
THE ORANGE COUNTY INDUSTRIAL FACILITIES
AND POLLUTION CONTROL FINANCING AUTHORITY
June 24, 1986
Secretary, Local Government Commission
Treasury Department
325 North Salisbury Street
Raleigh, North Carolina 27611
Attention: John D. Foust
Re: Isotechnologies, Inc. Industrial Revenue Bond
Financin , Oran e Count , North Carolina
Dear Mr. Secretary:
Pursuant to G. S. 159C-8, The Orange County Industrial
Facilities and Pollution Control Financing Authority hereby files
this application for approval of the issuance of its Industrial
Revenue Bond in a principal amount not to exceed $1,500, 000 for
the financing of an industrial project in Orange County, North
Carolina to be operated by Isotechnologies, Inc. , a North Carolina
corporation. The Authority hereby requests that the Local
Government Commission (a) approve the issuance of the Bond
pursuant to G. S. 159C-8, (b) approve the private sale of the Bond
on the terms and at the price set forth in the form of the Bond
Purchase Agreement pursuant to G. S. 159C-9, (c) determine the
interest rate to be borne by the Bond as set forth in said Bond
Purchase Agreement pursuant to G. S. 1590-6, and (d) approve the
system of registration for the Bond, as set forth in the Bond
Purchase Agreement, and the appointment of a Bond Registrar
pursuant to G. S. 159E. The Authority has transmitted a notice of
this filing to the Secretary of the Department of Commerce
pursuant to G. S. 159C-8, as required.
Your office has been furnished with copies of the most recent
drafts of the following documents in connection with the proposed
issuance of the Bonds:
1. Copy of Application for Approval of Project pursuant to
Section 159C-7 of the Act as filed by the Authority with
the Department of Commerce.
2 . Form of Loan Agreement, dated as of July 1, 1986, by and
between the Authority and Isotechnologies, Inc. (the
"Company" ) with the form of the promissory note of the
Company attached as Exhibit A thereto.
3 . Form of Bond Purchase Agreement, dated as of July 1,
1986, by and among NCNB National Bank of North Carolina
(the "Purchaser" ) , the Company and the Authority with the
form of the bond attached as Exhibit A thereto.
4. Form of Assignment, dated as of July 1, 1986, from the
Authority to the Purchaser.
5. Form of Security Agreement, dated as of July 1, 1986, by
and between the Authority and the Company.
6. Form of Deed of Trust Agreement, dated as of July 1,
1986, from the Company to Charles E. Harris as trustee
for the benefit of the Authority.
7. Form of Guaranty Agreement, dated as of July 1, 1986,
from the Company to the Purchaser.
8. Form of Guaranty Agreement, dated as of July 1, 1986,
from Mr. and Mrs. Jerome J. Richardson to the Purchaser.
Delivery of the Bonds is anticipated for July 7, 1986.
Although no material changes in the drafts submitted to you are
presently anticipated, the Authority will advise you of any
changes to be made thereto.
Very truly yours,
cc: Mr. Alan M. Green
2 .
THE ORANGE COUNTY INDUSTRIAL FACILITIES
AND POLLUTION CONTROL FINANCING AUTHORITY
June 24, 1986
Secretary, Department of Commerce
430 North Salisbury Street
Raleigh, North Carolina 27611
Attention: Mr. Bruce Strickland, Jr.
Re: Isotechnologies, Inc . Industrial Revenue Bond
Financing, Orange County, North Carolina
Dear Mr. Secretary:
The Orange County Industrial Facilities and Pollution Control
Financing Authority hereby notifies you in accordance with G. S.
159C-8 that it is today filing with the Secretary of the Local
Government Commission its application for approval of the issuance
of its Industrial Revenue Bond in a principal amount not to exceed
$1,500, 000 to finance the cost of a project in Orange County,
North Carolina, to be operated by Isotechnologies, Inc. , a North
Carolina corporation.
Please note your receipt on one of the enclosed copies and
return it to Alan Green at Brown & Wood, 1 World Trade Center, New
York, New York 10048.
Very truly yours,
Received by the Secretary of the Department of Commerce. .
Name:
Title:
Date:
cc: Mr. Everett M. Chalk
Mr. Alan Green
( 19)
THE BOARD OF COMMISSIONERS
FOR
THE COUNTY OF ORANGE, NORTH CAROLINA
The Board of Commissioners for the County of Orange, North
Carolina, met in special session in the Board Room of Lincoln
Center in Carrboro, North Carolina, at 7:30 P.M. , June 24, 1986.
Present: Chairman Don Willhoit
presiding, and
Commissioners Marshall, Care , Llo d and Walker
Absent: None
Also present: Geoffrey E. Gledhill, Orange County Attorney;
Count Mana er Kenneth R. Thorn son Assistant Co
Albert Kittrell, Clerk to the Board Beverly A. Blythe and Director of Personnel Beverly
Whitehead.
x �
�r
Commissioner Moses Care introduced the following resolution,
a copy of which had been distributed to each Commissioner and the
title of which was read:
RESOLUTION APPROVING THE ISSUANCE BY THE ORANGE COUNTY
INDUSTRIAL FACILITIES AND POLLUTION CONTROL FINANCING
AUTHORITY OF ITS INDUSTRIAL REVENUE BOND
( ISOTECHNOLOGIES, INC. PROJECT) IN A PRINCIPAL AMOUNT
NOT TO EXCEED $1, 500, 000 TO FINANCE AN INDUSTRIAL
PROJECT FOR ISOTECHNOLOGIES, INC.
BE IT RESOLVED by the Board of Commissioners for the County
of Orange:
Section 1. The Board of Commissioners has determined and
does hereby declare as follows:
(a) The Board of Commissioners of The Orange County
Industrial Facilities and Pollution Control Financing Authority
(herein referred to as the "Authority") has met and has taken the
following action in connection with the proposed issuance and sale
of the Authority' s Industrial Revenue Bond (Isotechnologies, Inc.
Project) , in a principal amount not to exceed $1, 500, 000:
1 . approved the form of a Loan Agreement, to be dated
as of July 1, 1986, by and between the Authority and
Isotechnologies, Inc. (the "Company") ;
2. approved and authorize the endorsement without
recourse and pledge of a promissory note of the Company, to
be dated as of July 1, 1986;
3 . approved the form of an Assignment, to be dated as
of July 1, 1986, from the Authority to NCNB National Bank of
North Carolina (the "Purchaser" ) ;
4. authorized the borrowing under and the issuance and
performance of the Authority' s Industrial Revenue Bond
(Isotechnologies, Inc. Project) , in a principal amount not to
exceed $1, 500, 000, and direct the execution and delivery of
said Bond;
5. approved the form of the Bond Purchase Agreement, to
be dated as of July 1, 1986, by and among the Authority, the
2 .
Purchaser and the Company, providing for the issuance and
sale of the Bond;
6. approved the form of the Security Agreement, to be
dated as of July 1, 1986, by and between the Company and the
Authority;
7. approved the form of the Deed of Trust, to be dated
as of July 1, 1986, from the Company to Charles E. Harris as
trustee for the benefit of the Authority; and
8. approved the form of a Guaranty Agreement, to be
dated as of July 1, 1986, from the Company to the Purchaser.
9 . approved the form of a Guaranty Agreement, to be
dated as of July 1, 1986, from Mr. and Mrs. Jerome J.
Richardson to the Purchaser.
(b) The Board of Commissioners for the County of Orange has
reviewed the action to be taken by the Board of Commissioners of
the Authority in connection with the issuance and sale of the Bond
and has made such other examination and investigation as it deems
necessary and relevant as the basis for the approval set forth
herein.
Section 2 . Pursuant to and in satisfaction of the require-
ments of Section 1590-4(d) of the General Statutes of North
Carolina, the Board of Commissioners for the County of Orange
hereby approves the issuance by the Authority of its Industrial
Revenue Bond ( Isotechnologies, Inc . Project) in a principal amount
not to exceed $1, 500, 000.
3 .
Section 3 . This resolution shall take effect immediately
upon its passage.
Commissioner Carey moved the passage of the foregoing
resolution and Commissioner Marshall seconded the motion, and the
resolution was passed by the following vote:
Ayes: Commissioners Carey, Marshall and Willhoit (Walker and
Lloyd were not resent at the time the vote was taken)
Noes: None
I, Beverly A. Blythe, Clerk to the Board of Commissioners for
the County of Orange, North Carolina, DO HEREBY CERTIFY that the
foregoing is a true and complete copy of so much of the
proceedings of the Board of Commissioners for said County at a
special meeting held on June 24, 1986, as relates in any way to
the approval hereinabove set forth.
I DO HEREBY FURTHER CERTIFY that notice of said meeting of
said Board of Commissioners, signed by the Chairman of said Board
and stating that a special meeting of said Board would be held at
7: 30 P.M. on June 24, 1986, in the Board Room of Lincoln Center in
Carrboro, North Carolina, concerning the passage of a resolution
approving the issuance by the Orange County Industrial Facilities
and Pollution Control Financing Authority of its not to exceed
$1,500, 000 Industrial Revenue Bond (Isotechnologies, Inc.
Project) , was, at least 48 hours before said meeting, delivered
4.
to each Commissioner or left at his or her usual dwelling place
and, at least forty-eight hours before said meeting, posted on the
principal bulletin board of said Board and mailed or delivered to
each newspaper, wire service, radio station, television station
and person that had filed with me a written request for notice
pursuant to G. S. 143-318. 12 .
WITNESS my hand and the common seal of said County, this 24th
day of June, 1986.
Clerk to the Board of Commissioners
[Seal ]
5.
(6)
THE ORANGE COUNTY INDUSTRIAL FACILITIES
AND POLLUTION CONTROL FINANCING AUTHORITY
The Board of Commissioners of The Orange County Industrial
Facilities and Pollution Control Financing Authority met in the
Conference Room of the Orange County Public Library, Tryon Street
in Hillsborough, North Carolina, at 2 :00 P.M. , on June 24, 1986.
Present: Chairman Don Willhoit
presiding, and
Commissioners: Care , Marshall, Llo d and Walker
Absent: Commissioners None.
Also Present: Geoffrey E. Gledhill, County Attorney;
County Manager Kenneth R. Thompson, Assistant County Managers William T. Laws.and Albert
ittre , lerk to the Board Beverly A. Blythe and Director of Personnel Beverly Whitehead.
*
* *
Moses Carey presented the following documents in
connection with the proposed issuance by the Authority of its
Industrial Revenue Bond ( Isotechnologies, Inc. Project) (the
"Bond") in a principal amount not to exceed $1, 500,000:
(a) a form of Bond Purchase Agreement, dated as of July
1, 1986 (the "Bond Purchase Agreement") ,
Authority, Isotechnologies, Inc. ) � by and , and NCNB Bank of North Carolina (the "Purchaser" ) , and hCNB
form of the bond (the "Bond") "' ) . wthh the as Exhibit A thereto;
(b) a form of Loan Agreement, dated as of July 1, 1986
(the "Loan Agreement") , by and between the Authority and the
Company, with the form of the promissory note (the "Note""
attached as Exhibit A thereto; )
" (c) a form of Assignment, dated as of July 1, 1986 (the
Assignment") , from the Authority to the Purchaser;
(d) a form of Security Agreement, dated as of July 1,
1986 (the "Security Agreement" ) , by and between the Company
and the Authority; and
(e) a form of Deed of Trust Agreement; dated as of July
1, 1986 (the "Deed of Trust" ) from the Company to Charles E.
Harris as trustee for the benefit of the Authority.
(f) a form of Guaranty Agreement, dated as of July 1,
1986 (the "Company Guaranty") , from the Company to the
Purchaser.
(g) a form of Guaranty Agreement, dated as of July 1,
1986 (the "Personal Guaranty") , from Mr. and Mrs. Jerome J.
Richardson to the Purchaser.
The documents presented were delivered to the Secretary of the
Authority and directed to be marked Exhibits A, B, C, D, E, F and
G respectively, and were made a part of the permanent records of
the Authority.
Moses Carey introduced the following resolution, the
title of which was read aloud:
RESOLUTION APPROVING AND AUTHORIZING THE ISSUANCE OF A
NOT TO EXCEED $1, 500, 000 INDUSTRIAL REVENUE BOND
(ISOTECHNOLOGIES, INC. PROJECT) OF THE AUTHORITY;
APPROVING THE FORM AND AUTHORIZING THE SALE OF THE BOND
PURSUANT TO THE BOND PURCHASE AGREEMENT; APPROVING AND
AUTHORIZING THE EXECUTION AND DELIVERY OF THE LOAN
AGREEMENT, THE BOND PURCHASE AGREEMENT, THE SECURITY
AGREEMENT, THE DEED OF TRUST AND THE ASSIGNMENT;
APPROVING THE FORM AND AUTHORIZING THE ENDORSEMENT AND
PLEDGE OF THE NOTE; APPROVING THE FORM OF THE COMPANY
GUARANTY AND THE PERSONAL GUARANTY; AUTHORIZING
EXECUTION AND DELIVERY OF CLOSING CERTIFICATES; AND
MAKING A TAX ELECTION, ALL IN CONNECTION WITH FINANCING
AN INDUSTRIAL PROJECT FOR ISOTECHNOLOGIES, INC.
BE IT RESOLVED by the Board of Commissioners (the "Board" ) of
The Orange County Industrial Facilities and Pollution Control
Financing Authority (the "Authority") :
Section 1. The Authority hereby approves the Loan Agreement
in the form that has been presented to the Board at this meeting,
and the Chairman or the Vice Chairman and the Secretary or any
Assistant Secretary of the Authority are hereby authorized to
execute and deliver the Loan Agreement, in any number of signed
counterparts, for and on behalf of the Authority in substantially
such form with such changes therein, additions thereto and
2.
omissions therefrom as those executing the Loan Agreement shall
approve, their execution and delivery thereof constituting the
conclusive approval of the Authority of any changes therein,
additions thereto or omissions therefrom.
Section 2. The Authority hereby approves the form of the
Company' s promissory note, to be dated as of the date of the Loan
Agreement (the "Note") , presented to the Board at this meeting in
the form attached as Exhibit A to the Loan Agreement. The
Authority hereby authorizes the endorsement without recourse and
pledge of the Note to the Purchaser, in substantially the form of
endorsement and pledge appearing on the form of the Note, as
security for the Bond.
Section 3 . The Authority hereby approves the Assignment in
the form of that has been presented to the Board at this meeting,
and the Chairman or the Vice Chairman and the Secretary or any
Assistant Secretary of the Authority are hereby authorized to
execute and deliver the Assignment, in any number of signed
counterparts, for and on behalf of the Authority in substantially
such form with such changes therein, additions thereto and
omissions therefrom as those executing the Assignment shall
approve, their execution and delivery thereof constituting the
conclusive approval of the Authority of any changes therein,
additions thereto or omissions therefrom.
Section 4. The Authority hereby approves the Security
Agreement in the form of that has been presented to the Board at
this meeting, and the Chairman or the Vice Chairman and the
Secretary or any Assistant Secretary of the Authority are hereby
authorized to execute and deliver the Security Agreement, in any
number of signed counterparts, for and on behalf of the Authority
in substantially such form with such changes therein, additions
thereto and omissions therefrom as those executing the Security
Agreement shall approve, their execution and delivery thereof
constituting the conclusive approval of the Authority of any
changes therein, additions thereto or omissions therefrom.
Section 5. The Authority hereby approves the form of Company
Guaranty from the Company to the Purchaser with respect to the
Bond.
Section 6. The Authority hereby approves the form of
Personal Guaranty from Mr. and Mrs. Jerome J. Richardson to the
Purchaser with respect to the Bond.
Section 7. For the purpose of providing funds to finance a
portion of the cost of the acquisition of a tract of land of
approximately 20 acres located east of Hillsborough, North
Carolina on State Road 1879 or Elizabeth Brady Road near the
3.
intersection of State Road 1879 and U. S. 70, the construction
thereon of an approximately 30, 000 square foot building and the
acquisition and installation thereon of machinery and equipment
(the "Project") to be used by the Company as a manufacturing
facility, the borrowing under and issuance and performance of a
revenue bond of the Authority pursuant to Section 9, Article V of
the Constitution of North Carolina and Chapter 159C of the General
Statutes of North Carolina, as amended, in a principal amount not
to exceed One Million Five Hundred Thousand Dollars
is hereby authorized. Said Bond shall be designated("T, e00 range
County Industrial Facilities and Pollution ControlFinancingnge
Authority Industrial Revenue Bond (Isotechnologies, Inc. Project) "
(herein referred to as the "Bond") , and the Bond shall be in
substantially the form and shall have the terms and provisions set
forth in the Bond Purchase Agreement (hereinafter mentioned) which
has been presented to the Board at this meeting, and the Chairman
or the Vice Chairman and the Secretary or any Assistant Secretary
of the Authority are hereby authorized to execute and deliver the
Bond for and on behalf of the Authority in substantially such form
with such changes therein, additions thereto and omissions
therefrom as those executing the Bond shall approve, their
execution and delivery thereof constituting the conclusive
approval of the Authority of any changes therein, additions
thereto and omissions therefrom.
Section 8. The Bond shall be sold to the Purchaser pursuant
to the terms and provisions of the Bond Purchase Agreement in the
form that has been presented to the Board at this meeting. The
terms and conditions on which the Purchaser has agreed to purchase
the Bond, as set forth therein, are hereby approved and accepted;
the Authority hereby confirms its agreement to sell the Bond
bearing interest at a rate per annum (except as therein provided)
equal to 70% of the Prime Rate (as defined in the Loan Agreement)
for the first six months from the date of the Bond and 65% of the
Prime Rate thereafter; provided, however, that such tax-exempt
rate of interest shall not exceed 12 .5% nor be less than 4.5%, to
the Purchaser at the purchase price of 100% of the principal
amount thereof and otherwise upon the terms and conditions set
forth in the Bond Purchase Agreement; and the Chairman or the Vice
Chairman and the Secretary or any Assistant Secretary of the
Authority are hereby authorized to execute and deliver the Bond
Purchase Agreement, in any number of signed counterparts, for and
on behalf of the Authority in substantially such form with such
changes therein, additions thereto and omissions therefrom as
those executing the Bond Purchase Agreement shall approve, their
execution and delivery thereof constituting the conclusive
approval of the Authority of any changes therein, additions
thereto or omissions therefrom, and the same are hereby further
authorized to deliver the Bond to the Purchaser upon evidence
4.
satisfactory to themselves and counsel for the Authority of
payment therefor.
Section 9. The Authority has determined to elect to have the
Bond issued pursuant to this resolution
from the provisions of qualify for the exemption
Code afforded by Paragraph (1) of subsection 103 (b) of the
the Vice ChairmanS ofpthegAuthorityDisthereby,authorizedhtirmak or
and file, or cause to be filed, such election on behalf of thee
Authority by submitting a letter to such effect in a form approved
by bond counsel to the Authority.
Section 10. The officers of the Authority are hereby
authorized and directed to execute and deliver such certificates
and statements as may be required by the Bond Purchase Agreement,
the Loan Agreement, the Security Agreement, the Deed of Trust, the
Assignment, the Company Guaranty or the Personal Guaranty or as
may otherwise be required in connection with the issuance of the
Bond, including the filing with the Internal Revenue Service of
Form 8038 of the Internal Revenue Service and the filing with the
Secretary of the Local Government Commission of the State of North
Carolina, pursuant to G. S. 159C-8, of an application the issuance of the Bond and related matters. Su for approval
are further authorized and directed to sign s' Such officers
filed such financing statements gn and to cause to be
s�atemen,,s and to cause to be recorded such
instruments as counsel to the Authority shall deem necessary or
advisable in connection with the issuance of the Bond.
officers shall be entitled to rely h
on t sulk
Authority in deciding to take or not totakevany actionninl to the
connection with the issuance of the Bond.
Section 11 . This resolution shall take effect upon its
passage.
Commissioner Moses Care
foregoing resolution entitled: moved passage of the
RESOLUTION APPROVING AND AUTHORIZING THE ISSUANCE OF A
NOT TO EXCEED $1, 500, 000 INDUSTRIAL REVENUE BOND
( ISOTECHNOLOGIES, INC. PROJECT) OF THE AUTHORITY;
APPROVING THE FORM AND AUTHORIZING THE SALE OF THE BOND
PURSUANT TO THE BOND PURCHASE AGREEMENT; APPROVING AND
AUTHORIZING THE EXECUTION AND DELIVERY OF THE LOAN
AGREEMENT, THE BOND PURCHASE AGREEMENT, THE SECURITY
AGREEMENT, THE DEED OF TRUST AND THE ASSIGNMENT;
APPROVING THE FORM AND AUTHORIZING THE ENDORSEMENT AND
PLEDGE OF THE NOTE; APPROVING THE FORM OF THE COMPANY
GUARANTY AND THE PERSONAL GUARANTY; AUTHORIZING
EXECUTION AND DELIVERY OF CLOSING CERTIFICATES; AND
5 .
MAKING A TAX ELECTION, ALL IN CONNECTION WITH FINANCING
AN INDUSTRIAL PROJECT FOR ISOTECHNOLOGIES, INC.
and Commissioner Shirley Marshall seconded the motion, and the
resolution was passed by the following vote:
Ayes: Commissioners: Don Willhoit, Shirley Marshall and Moses Carey
(Commissioners Walker and Lloyd were not present at the time the vote was taken) .
Noes: Commissioners: None
*
I , Maury Klein, Secretary of The Orange County Industrial
Facilities and Pollution Control Financing Authority and keeper
of the official minutes thereof, DO HEREBY CERTIFY that the
foregoing is a true copy of certain proceedings of the Board of
Commissioners of the Authority taken at a meeting held at the
time and place noted on the front page of these excerpts of
minutes, is a complete copy of so much of the recorded minutes of
said meeting as relates in any way to the passage of the
resolution hereinabove set forth and that such resolution was
duly adopted and remains in full force and effect on the date
hereof.
I DO HEREBY FURTHER CERTIFY that, pursuant to Article II of
the by-laws of the Authority, all members of the Authority were
mailed written notice of said meeting not less than twenty-four
hours prior to the time noted on the front page of these excerpts
of minutes and that, at least forty-eight hours before said
meeting, had posted such notice on the principal bulletin board
or at the door of the usual meeting room of the Authority and had
mailed or delivered such notice to each newspaper, wire service,
radio station, television station and person that had filed with
me a written request for notice pursuant to G.S. 143-318. 12.
WITNESS my hand and the official seal of The Orange County
Industrial Facilities and Pollution Control Financing Authority,
the 24th day of June, 1986 .
Secretary
(Seal)
6 .
•
THE ORANGE COUNTY INDUSTRIAL FACILITIES
AND POLLUTION CONTROL FINANCING AUTHORITY
June 24, 1986
Secretary, Local Government Commission
Treasury Department
325 North Salisbury Street
Raleigh, North Carolina 27611
Attention: John D. Foust
Re: Isotechnologies, Inc. Industrial Revenue Bond
Financing, Orange County, North Carolina
Dear Mr. Secretary:
Pursuant to G. S. 159C-8, The Orange County Industrial
Facilities and Pollution Control Financing Authority hereby files
this application for approval of the issuance of its Industrial
Revenue Bond in a principal amount not to exceed $1, 500, 000 for
the financing of an industrial project in Orange County, North
Carolina to be operated by Isotechnologies, Inc. , a North Carolina
corporation. The Authority hereby requests that the Local
Government Commission (a) approve the issuance of the Bond
pursuant to G. S. 159C-8, (b) approve the private sale of the Bond
on the terms and at the price set forth in the form of the Bond
Purchase Agreement pursuant to G. S. 1590-9, (c) determine the
interest rate to be borne by the Bond as set forth in said Bond
Purchase Agreement pursuant to G.S. 159C-5, and (d) approve the
system of registration for the Bond, as set forth in the Bond
Purchase Agreement, and the appointment of a Bond Registrar
pursuant to G. S. 159E. The Authority has transmitted a notice of
this filing to the Secretary of the Department of Commerce
pursuant to G. S. 159C-8, as required.
Your office has been furnished with copies of the most recent
drafts of the following documents in connection with the proposed
issuance of the Bonds:
1. Copy of Application for Approval of Project pursuant to
Section 159C-7 of the Act as filed by the Authority with
the Department of Commerce.
2. Form of Loan Agreement, dated as of July 1, 1986, by and
between the Authority and Isotechnologies, Inc. (the
"Company" ) with the form of the promissory note of the
Company attached as Exhibit A thereto.
3 . Form of Bond Purchase Agreement, dated as of July 1,
1986, by and among NCNB National Bank of North Carolina
(the "Purchaser" ) , the Company and the Authority with the
form of the bond attached as Exhibit A thereto.
4. Form of Assignment, dated as of July 1, 1986, from the
Authority to the Purchaser.
5 . Form of Security Agreement, dated as of July 1, 1986, by
and between the Authority and the Company.
6. Form of Deed of Trust Agreement, dated as of July 1,
1986, from the Company to Charles E. Harris as trustee
for the benefit of the Authority.
7 . Form of Guaranty Agreement, dated as of July 1, 1986,
from the Company to the Purchaser.
8. Form of Guaranty Agreement, dated as of July 1, 1986,
from Mr. and Mrs. Jerome J. Richardson to the Purchaser.
Delivery of the Bonds is anticipated for July 7, 1986.
Although no material changes in the drafts submitted to you are
presently anticipated, the Authority will advise you of any
changes to be made thereto.
Very truly yours,
cc: Mr. Alan M. Green
2 .
THE ORANGE COUNTY INDUSTRIAL FACILITIES
AND POLLUTION CONTROL FINANCING AUTHORITY
June 24, 1986
Secretary, Department of Commerce
430 North Salisbury Street
Raleigh, North Carolina 27611
Attention: Mr. Bruce Strickland, Jr.
Re: Isotechnologies, Inc. Industrial Revenue Bond
Financing, Orange County, North Carolina
Dear Mr. Secretary:
The Orange County Industrial Facilities and Pollution Control
Financing Authority hereby notifies you in accordance with G. S.
159C-8 that it is today filing with the Secretary of the Local
Government Commission its application for approval of the issuance
of its Industrial Revenue Bond in a principal amount not to exceed
$1,500, 000 to finance the cost of a project in Orange County,
North Carolina, to be operated by Isotechnologies, Inc. , a North
Carolina corporation.
Please note your receipt on one of the enclosed copies and
return it to Alan Green at Brown & Wood, 1 World Trade Center, New
York, New York 10048.
Very truly yours,
Received by the Secretary of the Department of Commerce. .
Name:
Title:
Date:
cc: Mr. Everett M. Chalk
Mr. Alan Green