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Home My WebLink AboutPR 13488: TRIANGLE WASTE SOL. P. R. No. 13488 o3/10/06 ts REBOLUTION NO. A RESOLUTION APPROVING AN ECONOMIC INCENTIVE CONTRACT BETWEEN TRIANGLE WASTE SOLUTIONS, LLC AND THE CITY OF PORT ARTHUR SECTION 4A ECONOMIC DEVELOPMENT CORPORATION WHEREAS, on January 17, 2006, the City Council approved Resolution 06-004 as it pertains to an economic incentive agreement between Triangle Waste Solutions, LLC and the City of Port Arthur Section 4A Economic Development Corporation; and WHEREAS, changes have been made to the proposed contract, as denoted in Exhibit "A"; and WHEREAS, this contract is being presented to the EDC Board of Directors and the City Council for approval. NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PORT ARTHUR, TEXAS: Section 1. That the facts and opinions in the preamble are true and correct. Section 2. That the city of Port Arthur Section 4A Economic Development Corporation is herein authorized to enter into an economic incentive agreement with Triangle Waste Solutions, LLC, in substantially the same form as attached hereto as Exhibit ~'B". Section 3. That Resolution No. 06-0004 is herein repealed. Section 4. That a copy of the caption of this Resolution z. PR13488 be spread upon the Minutes of the City Council. READ, ADOPTZD AND APPROVED on this ~ day of , A.D., 2006, at a Meeting of the City Council of the City of Port Arthur, Texas, by the following vote: AYES: Mayor Councilmembers ' ; NOES: Z. PR13488 MAYOR ATTEST= CITY SECRETARY APPROVED AS TO FORM: SEE CONFIDENTIAL MEMO CITY ATTORNEY APPROVED FOR ADMINISTRATION= CITY MANAGER APPROVED FOR THE CITY OF PORT ARTHUR SECTION 4A ECONOMIC DEVELOPMENT CORPORATION BY: FLOYD BATISTE, CEO/EDC z. PR13488 EXHIBIT "A" ........ ~ AUSTIN BEAUMONT HOUSTON GERME ! ERTZ .,. L'L'i:'AT T O r N E ~ ~4.~,~, j~A T L A W KATHLEEN A. McGLYNN ASSOCIATE Direct Line: 409.813.8000 kmcglynr~germe~.com March 10, 2006 Via Facsimile No. 1-409-962-4445 Mr. Floyd Batiste Chief Executive Officer City of Port Arthur EDC P.O. Box 3934 Port Arthur, Texas 77642 Re: Triangle Waste Properties LP; GG File #56257 Contract for submission to Joint EDC Board/City Counsel Meeting on Marc'h 14, 2006. Dear Mr. Batiste: Attached is the Executive Summary and Contract for the revised City of Port Arthur Section 4A Economic Development Corporation's ("PAEDC's") contract with Triangle Waste Properties LP. The changes made since the contract was approved by the EDC Board and City Council are noted on the attachments; however, the key changes are as follows: · PAEDC will contract with, and convey the land to, Triangle Waste Properties, LP, not Triangle Waste Solutions, LLC. Since Triangle Waste Solutions, LLC is the General Partner of the newly formed Triangle Waste Properties LP, Triangle Waste Solutions, LLC is liable for the acts or omissions committed by Triangle Waste Properties, LP (hereinafter "Triangle"). As a result, we do not need a guaranty from Triangle Waste Solutions, LLC to protect PAEDC's interests. · PAEDC will grant Triangle an additional $500,000, paid annually in $100,000 increments, with the first payment due after Triangle star~s construction on the new facility. The additional grant will be secured with a second Deed of Trust on the property, junior to the Texas State Bank's Deed of Trust for the Construction loan. Safeguards similar to those developed for the Second Deed of Trust for Reliable Polymer Services are incorporated into this Second Deed of Trust, for example, the senior lien must be limited to $4,000,000. · The milestone schedule has been adjusted to better match the schedule now anticipated. This includes advancing the target date to achieve 21 new jobs from December 31,2006 to December 31, 2007. · Many of the changes to the contract are based on language negotiations between Germer Gertz, L,L.P. and Triangle's attorney, Mr. Jack Field. Nothing was changed that would impair the rights of PAEDC to enforce this contract. Some example changes are (1) the form of Deed is now included in the contract.and (2) Exhibit "H' has been added to clarify the basic intent of the contract. The contract revisions have been approved by Germer Gertz, L.LP. as to legality and the project is still an eligible Section 4A project. Sincerely, GERMER GE R.'FZ, L.LP. By: KAM/Ir Kathleen A. McGlynn ~ cc: Jana Barnes Guy N. Goodson (in thefirm) P.O. BOX 4915 · BEAUMONT, TX 77704 · PHONE: 409.654.6700 · FAX: 409.835.2115 ECONOMIC INCENTIVE CONTRACT & LOAN AGREEMENT BETWEEN THE CITY OF PORT ARTHUR SECTION 4A ECONOMIC DEVELOPMENT CORPORATION & TR ANGLE WASTE,.PROPER~!E~.~-P Tdang e Waste ,Properties LP, a '~exas !imif~l.p~[tn~rshiP~ ~:~'rieng!e:).i~.~.. (~l~:Sok~ti~ns, LL.C local corporation, eng'~g'e~I'i~'w~{e n~a§~n~en(, which includes provdng septic waste equipment and services; metal collection and resale; and roll-off truck services. Triangle's target market lies between Lake Charles, Louisiana and Galveston, Texas. Triangle's lease, at its current location in Beaumont, is nearing expiration and Tdangle would like to move and expand. The City of Port Arthur Section 4A Economic Development Corporation ("PAEDC") will convey a ten (10) acre parcel in the new PAEDC Business Park (the "Park") to Triangle, which cost the PAEDC an estimated $392,040. (The deed will reserve the necessary easements for the city utilities.) Additionally, PAEDC will grant Triangle $500,000, in five annual grants of $'100,000 each. In exchange, Triangle agrees to hire 21 new emolovees, bringing the total number of employees in the new Park facility to 60, with an estimated annual payroll of $1,650,000, by December 3t, 2007. Triangle promises to use its best efforts to hire Port Arthur, Texas residents. Additionally, Triangle agrees to meet or exceed the Park's covenants and restrictions; agrees to meet Triangle-specific restrictions; agrees to allow the EDC to pre-approve the architectural drawings for the facility; and agrees to serve as a model of cleanliness and maintenance for other Park occupants. If Trian~ this agreement then the qrants will automatically convert to a loan in the amount of $392,040 plus cash grants made by PAEDC minus any credits earned as described hereunder (liquidated damages). The loan will have a three-year term, starting on the date of Triangle's breach, and an interest rate of ten percent (10%). To secure this loan, (1) Joe Swnbank, and..D0na.l~l..po~:ch will ..... provide a Texas State Sank Certificate of Deposit in the amount of $392,000, according to a Commercial Security Agreement executed by.s~ch IParti~S. ~[i.~..p~f.e..c.~ by f.i![~g.. a Financing Statement (UCC-1 Form) with the Secretary of State, and (2) Triangle will grant PAEDC a Deed of Trust, with PAEDC holding a second priority lien. Triangle may earn credits to reduce the duration of this contract or to reduce liquidated damages in the event of a breach. Starting when Triangle achieves the payroll level of $1,650,000 (annualized) and continuing for as long as Triangle maintains at least this level of employment, Tdangle wilt receive a $1.00 credit for each $,6~00 of payroll paid to residents of Port Arthur. Payroll to non-residents cannot be credited~ To avoid surprises, Triangle agrees to send PAEDC brief status reports, every three (3) months for the first year and every six months thereafter, until issuance of a close out report. Triangle will forfeit its credits if it fails to cure such default within 5 days for any reporting pedod for which it did not issue a report in a timely manner. EXHIBIT "B" ECONOMIC INCENTIVE CONTRACT & LOAN AGREEMENT BETWEEN THE CITY OF PORT ARTHUR SECTION 4A ECONOMIC DEVELOPMENT CORPORATION AND TRIANGLE WASTE ,pR.0~ER~!E..S. LP ...................... INTRODUCTION ................................................................................................................................... CONTRACT DATES ............................................................................................................................ PARTIES ............................................................................................................................................... (A) PERFORMANCE BY PAEDC .................................................................................................... (B) PERFORMANCE aY TRIANGLE .................................................................................................... (C) TRIANGLE CREDITS -- SUBSTITUTE PERFORMANCE ........................................... ; ................... TRIANGLE'S PERFORMANCE MILESTONE SCHEDULE .......................................................... PAEDC'S CONDITIONAL OBLIGATIONS AND LIMITED LIABILITY ........................................ LIQUIDATED DAMAGES FOR BREACH OF CONTRACT BY TRIANGLE .............................. RECORDS / INSPECTION I PAEDC AUDIT .................................................................................... HOLD HARMLESS .............................................................................................................................. SUBCONTRACTS ............................................................................................................................. CONFLICT OF INTEREST / DISCLOSURE OBLIGATION ........................................................... NONDISCRIMINATION / EMPLOYMENT I REPORTING ............................................................ LEGAL AUTHORITY ........................................................................................................................... NOTICE OF LEGAL OR REGULATORY CLAIMS AGAINST TRIANGLE ................................. CHANGES AND AMENDMENTS ....................................................................................................... DEFAULT / TERMINATION .............................................................................................................. TRIANGLE AUDITS ........................................................................................................................... ENVIRONMENTAL CLEARANCE REQUIREMENTS .................................................................. ORAL AND WRITTEN CONTRACTS I PRIOR AGREEMENTS ................................................ VENUE ................................................................................................................................................. ADDRESS OF NOTICE AND COMMUNICATIONS ..................................................................... CAPTIONS ........................................................................................................................................ COMPLIANCE WITH FEDERAL, STATE AND LOCAL LAWS ................................................. CONDITIONS PRECEDENT ............................................................................................................ ATTORNEY APPROVALS ............................................................................................................... CONTRACT EXECUTION ............................................................................................................... Exhibit "A'. ........................ Industrial Park Covenants and Restrictions Exhibit "B". ....................... Commercial Promissory Note Exhibit "C". ....................... Commemial Security Agreement Exhibit "D". ....................... Texas State Sank Acknowledgment Exhibit "E'. ........................ UCC-1 Financing Statement Exhibit "F". ........................ Certification Regarding Lobbying Exhibit "G". ........................ Form of Deed Exhibit "H". ........................ Special Addendum Exhibit "1". .......................... Second Deed of Trust ECONOMIC INCENTIVE CONTRACT & LOAN AGREEMENT BETWEEN THE CITY OF PORT ARTHUR SECTION 4A ECONOMIC DEVELOPMENT CORPORATION AND TRIANGLE WASTE .PR0.P ERT~E~.I~P INTRODUCTION Triangle Waste,prop~i~.Lp.(~'l~[!~ngle") i~.~.!99a!.~-?~o?ation~ ~l~.gag~d in waste management, which includes (1) providing septic waste equipment and services, (2) metal waste collection and recycle, and (3) roll-off truck services. Triangle's target market lies between Lake Charles, Louisiana and Galveston, Texas, Only one-third of the target market lies within in Jefferson County, meaning that the majority of services provided will be exported, thereby infusing new dollars into the Iocel economy. Triangle's lease at its current location is nearing expiration and Triangle wants to move. Triangle is expanding and can promise jobs in exchange for an incentive from the City of Port Arthur Section 4A Economic Development Corporation ("PAEDC"). CONTRACT DATES CONTRACT START DATE 1. This Economic Incentive Contract and Loan Agreement ("Agreement") is entered into with an effective date of ,2006, but in no case later than ~!Y.3!.~.~)~6, by and between PAEDC and Triangle, CONTRACT END DATE 2. This contract expres the earlier of ,September 10 201~. Oro3n0 da~,s after Triangle and PAEDC ,perfor~'~fully, sul~ject to earli~ t~i*n~tion 0'~'~-i" :'~;0i~{~ry ~r [ ~e~: ~, 2co9. nvoluntary, as provided' ~e.r??. ' Ir~ th~' ~'0{ brea~, ~ltl~o~h this contraci ;~xpii*~S, th~":. ~et~d: ,~ler promissory note in Exhibit A becomes effective. PARTIES '~er.~: or breaches the c~lflact 3. City of Port Arthur Section 4A Economic Development Corporation. Io~a~.9~l..~', ( ~ted= ('PAEDC') 4173-39t~ Street, Port Arthur, Texas, 77642, is a corporation` It is duly authorized to do business in the State of Texas under Section 4A, Article 5190.6 V.T,C.A. (the Development Corporation Act of 1979) and duly authorized by Resolution of the City Council of the City of Port Arthur to enter into this contract. So authorized and as provided by the PAEDC bylaws, the President and Secretary of the PAEDC Board have the authority to execute this contract 4. Trian,qle Waste_ Properties LP (~r~.g!~)..!~ ~ ~as L!r~.i~..~artners-I~.P..--. Joseph B. Swinbank (name) is duly authorized to enter into and execute this contract for ' Triangle. The corporation's registered agent in Texas is Capitol Corporate Services, Inc., 800 Brazos, Suite 1100, Austin, TX 78701, ATTN: Joe Swinbank. PROMISED PERFORMANCE 5, The parties agree to perform as follows. (a) PERFORMANCE BY PAEDC (1) PAEDC shall convey to Triangle ten (10) acres of land in the new PAEDC Business Park (the "Park"); Specifically, Lot,4 ...... Block I on South .... Business Park Drive, Port Arthur, Texas, 77640. In the deed, PAEDC will reserve the necessary easements for the city utilities. The PAEDC estimates a cost to the PAEDC of THREE HUNDRED NINETY TWO THOUSAND FORTY AND NO/100 DOLLARS ($392,040) for the ten (10) acre parcel of land. (2) PAEDC shall grant Triangle the amount of FIVE HUNDRED THOUSAND AND NO/t00 DOLLARS ($500,000.00), in five payments of $100,000.00 each. The first payment will be made within forty five (45) days after construction of the new Triangle facility begins. Subsequent payments of $100,000 shall be made each year thereafter, if and only if Triangle is compliant with the performance milestone schedule herainunder. For example, if Triangle starts construction on June 7, 2006 then PAEDC will pay $100,000 by July 22t~ of 2006 and, assuming compliance with the milestone schedule, again on July 22~ of 2007, 2008, 2009, and 2010. These are PAEDC's sole obligations except as otherwise expressly set forth herein (including the exhibits hereto). Triangle is totally responsible for complying with all city, county, state and federal statutes, ordinances, regulations and permits. PAEDC has installed underground utility ,trunk !!~ into the p~k~..l~. PAEDC is not responsible for the cost of installing underground facility service nes from the,trunk nes Addtona y PAEDC w not I~ay utility connection costs. (b) PERFORMANCE BY TRIANGLE (1)Triangle will select an architect and general contractor who will build an attractive facility that both complies with the Park's covenants and restrictions and has been pre-approved by the EDC Board. The Park's covenants and restrictions are contained in Exhibit "A" and are incorporated by reference into this contract in their entirety. (2) Triangle agrees to the following additional covenants and restrictions to address the concems of the PAEDC and City Council regarding the potential unsightliness of portable toilets and scrap: a. Screen property lines with 6-foot fencing with landscaping on the outside to provide extra protection; b. Screen the transfer station inside the plant with internal fencing; c. Keep Triangle's scrap metal operation at another location; do not move the operation to the Port Arthur Business Park; d~ Design, build and operate the Port Arthur Business Park plant so that scrap is not visible to any member of the public standing at ground level on a public way; e. Enclose all operations within buildings that have three walls with the open side of the buildings facing toward the inside the plant, so that the inside of buildings are not visible from a public way; and f. Store all equipment, trucks, roll off containers, etc., either behind the buildings or inside of the plant, so as not to be visible from South Business Park Drive. (3) Triangle will hire at least 21 new employees by December 31, 2007. b[!nging the total number of employees at the Park to 60 employees, with an estimated annual total payroll of $1,650,000 per year,~ ss measured by Internal Revenue Service (iRS) forms W-2 ~nd W-3. (4) Triangle will use its best efforts to hire Port Arthur, Texas, residents to the maximum extent feasible and shall track and report actual performance as a percent of total employees. (5) Contemporaneously with PAEDC's land grant to Triangle, (a) Joe Swinbank and Donald Poarc w execute a commerca security agreement giving PAEDC a security interest in a $392.040 Certificate of DePosit at Texas State Sank (See Exhibit "C" and "E"), and (b) contemporaneously with the first grant payment from PAEDC, Triangle will execute a Deed of Trust in the form of Exhibit 'T' attached hereto (the "Second Deed of Trust") ,c0v~l~i~.g the granted Pz'~perty subject to the senior lien of Texas State Bank as the lending bank;'~i~J-~nJ~r'l'i~n n0t'~o'~xcee~J'"F'~0'l~ Migi~ibN AND' N~i'I00 ($4,000,000) of indebtedness. (6) On demand by PAEDC and in response to Triangle's failure to achieve a performance milestone, Triangle shall provide PAEDC, within f5 business This assumes 2000 hours per ycar and an avctag~ employee wage of $27,500 per year. days, with assurances that it has both the intention and the capabilities to perform fully its contractual obligations, (7) Triangle, as one of the first residents of the Park shell use its best efforts to be the model of cleanliness, maintenance, and beauty, outside the perimeter of the fence, (c) TRIANGLE CREDITS - SUBSTITUTE PERFORMANCE (1) Triangle may earn credits against the estimated $392,040 grant, to either reduce the duration of this contract or reduce the amount of liquidated contract damages in the event of a breach by Triangle. Starting when Triangle achieves the performance level described in Paragraph 5(b)(3), and continuing for as long as Triangle maintains this promised performance, Triangle will earn a $1.00 credit for each $~.00 ~f..payro!! paid to res Port Arthur, as reported to the IRS on IRS Form W-2. No credit is earned for non-resident employees. Total credit cannot exceed $892,040~ (2)TRIANGLE will forfeit any credits it earned during a period for which a report is scheduled but TRIANGLE, nonetheless, fails to issue the report. TRIANGLE'S PERFORMANCE MILESTONE SCHEDULE 6. Although failure to achieve a performance milestone is not a breach of contract, a failure is grounds for PAEDC to demand reasonable assurances2 from Triangle that it can and will fully perform its contractual obligations. Failure to provide demanded assurances is a breach of contract. 7. Triangle's performance milestones are contained in the table below. TRIANGLE'S PERFORMANANCE MILESTONE SCHEDULE Deadline Milestone (a) Apr 1, 2006 i Review architectural plans with the EDC Board for approval (b)l Apr 30~ 2006 Issue a status report3 t~ PAEDC'~ ~h!ef..~¥~utiv~ O~i(~ ('~E(~').~?. ~he i, ' pefi(~J'fl-om the effective dai~'~t this contract {o"March 31, 2006. (c) i July31 2006 Status raport for April l , 2OO6 to June 30, 2006, :~(d) Sept. 30 2006 ! Complete facility construction (e) Oct. 31,2006 Statusreportforjuyl.,~O6~oSeptembe~30~.~6~ 3 status rape[ts shall include the status of construction, employment and the percentage of employees who (f) iFeb28,2007 ; Stetus report4 for January l,2006 to December 31, 2006 (g)~ July 31~ 2007 Status report fo~ January !,2007 to June 30, 2007, · .. oe~eted~ 5 .... h) 'i Dec, 31, 2007 Ach eve performance of 2t new (60 total) employees; i Annualized total payroll of $1,650,000. oe~ted:; sustain employment [( ) Feb. 28, 2008 i Status repor~ for.l~n !, 2~ tq Deqg. r~? ~, ~00~; ~ust~i~ ~rnp~0ymen~-. ~e~eted: (J) t Juy31~2008 StatusreportforJan 1 2008to June30 2008 Sustain employment (k) Feb 28.2009~ Sta~us report for Jan I 2008toDec. 31 2008 Sustainemployment~ (I) I Feb 28, 20t0 Status report for Jan. t, 2009 to Dec. 31,2008;Sustanempoyment (m~ July 31, 2010 i Status report for Jan. 1,2010 to June 30, 2010; Sustain employment (n) .Sept. 30 2010'! Close out report.~r present, ation to ~f~.~AED~.~ard at. i~ October '. Formatted: Sull~ts apd Numbering ~ February 5~ status reports shall also include ~he identity of all Triangle Waste Solutions, LLC stockholders who own more than 5% of the shares. ~ Or thirty (30) days after Triangle and PAEDC fully per[orm~ complete. [ Deleted: PAEDC'S CONDITIONAL OBLIGATIONS AND LIMITED LIABILITY 8. The PAEDC shall not be liable, in contract or otherwise, to Triangle, or to any person or entity claiming by or through Triangle, for any expense, expenditure or cost incurred by or on behalf of Tdangle related to the project made the basis of this Agreement. The PAEDC's sole liat3ility/obligations, if any, shall be to Triangle and shall be rimited to the conditional incentive obligations detailed in this Agreement. 9. Triangle shall not use the land herein for any purpose(s) other than that specifically disclosed heroin and as further disclosed within that certain application made by or on behalf of Triangle, which application is incorporated herein for all purposes. LIQUIDATED DAMAGES FOR BREACH OF CONTRACT BY TRIANGLE 10. In the event Triangle fails to perform its obligations under this contract, the $392,040 land orant value, plus cash grants received from PAEDC minus any credits earned, will automatically convert to a loan (liquidated damages), effective on the day of breach, as agreed by Triangle in the executed Commemial Promissory Note contained in Exhibit "B." 11. It is exprossly understood and agreed by the parties that any right or remedy shall not preclude the exercise of any other right or remedy under this Contract or under any provision of law, nor shall any action taken in the exercise of any dght or remedy be deemed a waiver of any other rights or remedies. Failure to exercise any right or remedy hereunder shall not constitute a waiver of the right to exercise that or any other right or remedy at any time. RECORDS I INSPECTION I PAEDC AUDIT 12. Triangle shall maintain records as necessary to allow the PAEDC to audit and verify proper utilization of Lot lA in compliance with this Agroement and the representations and warranties contained herein and in Triangle's application. 13. Triangle shall give the PAEDC, or any of its duly authorized reprosentatives, access to and right to examine all books, accounts, records, reports, files and other papers, things or property belonging to or in use by Triangle pertaininq to this Agreement. Such dghts to access shall continue as long as the records are maintained by Triangle. Triangle agrees to maintain such rocords in an accessible location. As to job creation, interim status roports shall include documentation substantiating the accuracy of such roports, including, for example, 941 payment reports, Texas Workforce .Commission reports, or other such reports confirming total jobs, payroll and other relevant information. Driver's license information is appropriate for interim reporting of Port Arthur residents hired. Year end reports shall be substantiated with IRS Forms W-2 and W-3. The reporting obiective is to include documentation necessary to for PAEDC to vedfy said roport without further outside inquiry. 14. All records pertinent to this Agroement shall be rotained by Triangle at least three years following the date of termination of this Agroement, whether said termination is a result of default or whether said termination is a result of final submission of a close out report by Triangle detailing Triangle's compliance w~th its obligations provided herein. Further, in the event any litigation, claim or audit arising out of or related to this Agreement is instituted before the expiration of the three (3) year period and extends beyond the three year period, the records will be maintained until all litigation, c~aims or audit findings involving this Agreement and the records made the basis of same have been resolved. 15. Upon written request, Tdangle shall provide PAEDC with all repods reasonably necessary for PAEDC compliance with Article 5190.6 V.T.C.A. 16. It is expressly understood and agreed by the parties hereto that if Triangle fails to submit to PAEDC in a timely and satisfactory manner any report required by this Contract, PAEDC may, at its sole discretion, demand assurances that Tdangie can and will fully perform its contractual obligations. If Triangle fails to provide adequate assurances in ten (10) business days then Triangle is in breach and the conditional land grant automatically become a loan, as described herein, 17. The PAEDC reserves the right, from time to time, to carry out field inspections/audits to ensure compliance with the requirements of this Agreement. After completion of any such audit, the PAEDC, at its option, may provide Triangle with a wdtten report of the audit findings. If the audit report details deficiencies in Triangle's performance under the terms and conditions of this Agreement, the PAEDC may establish requirements for the timely correction of any such deficiencies by Triangle. HOLD HARMLESS 18. ,Triangle shall indemnify, defend and hold the PAEDC and the City of Port Deleted:Triangleagreestoho~ Arthur (tog~{h~:-'i~"~l~cl~mnified "[~i~s~i) harm'l~ 'f~m" ~[i 'hlj~.i~ ~laims~, por[ba~mles~ file PAEDC end ~le C~ Of Arthur from any a~ct aa claims. liabilities, costs or damages (including court costs and reasonable attorney's fees) ~nand~, ~ =.~s,g=ct~on of any sustained by or threatened against any of the indemnified Parties for Injury or death kind or d~racter whic~ maybe to persons or physical damage to property arising out of relating to Triangle's entry er~g outofcrln anyway related to or activities upon the property which is the subject matter of this Contract. ~ of~is Agreement, and the SUBCONTRACTS byth~ ^~r~em~t 19, Triangle may not subcontract for performance credits described in this Contract without obtaining PAEDC's wdtten approval, which may be withheld for any reason. Trtangle shall only subcontract for performance credits described in this Contract after Triangle has submitted Subcontractor Eligibility Request, as specified by PAEDC, for each proposed subcontract, and Triangle has obtained PAEDC's prior written approval, based on the information submitted, of Triangle's intent to enter into such proposed subcontract. Triangle, in subcontracting for any performances described in this contract, expressly understands that in entering into such subcontracts, PAEDC is in no way liable to Triangle's subcontractor(s), 20. In no event shall PAEDC's prior wdtten approval of a subcontractor's eligibility, be construed as relieving Triangle of the responsibility for ensuring that the performances rendered under all subcontracts are rendered so as to comply with all terms of this Contract, as if such performances rendered were rendered by Triangle. PAEDC's approval does not consfltute adoption, ratification, or acceptance of Triangle's or subcontractor's performance hereunder. PAEDC maintains the fight to insist upon Triangle's full compliance with the terms of this Contract, and by the act of subcontractor approval, PAEDC does not waive any right of action which may exist or which may subsequently accrue to PAEDC under this Contract. 21. Triangle, as well as all of its approved subcontractors, shall comply with all applicable federal, state, and local laws, regulations, and ordinances relating to the land granted under this Contract and operations and activities conducted on said land. CONFLICT OF INTEREST / DISCLOSURE OBLIGATION 22. Conflict of Interest: No employee, agent, officer or elected or appointed official of the City of Port Arthur or the PAEDC who has participated in a decision making process relatad to this contract (without recusing him/herself and executing a conflict affidavit) may obtain a personal or financial interest or benefit from an PAEDC assisted activity, or have an interest in any contract, subcontract, or agreement (or proceeds thereof) with respect to an PAEDC assisted activity, during their tenure or for one (1) year thereafter. Triangle shall ensure compliance with applicabte provisions under Article 5190.6 V,T.C.A. and Chapter 171 Local Government Code V,T.C.A. 23. Disclosure: In conjunction with execution of this Agreement, Triangle has fully disclosed to PAEDC all known and potential owners of interests in Triangle (whether stockholder, manager, member or otherwise). In the event of any change in ownership or control of Triangle of five pement (5 %) or greater, Triangle shall notify PAEDC in writing. Further, Triangle shall be obligated to notify in writing the PAEDC in the event any time prior to, dudng or one (1) year after the term of this Contract, any City or PAEDC employee or representative or any third party with a conflict of interest obtains or proposes to obtain a financial benefit, direct or indirect, from Triangle. Failure to provide said notice immediately or no later than five (5) business days after receipt of information shall constitute a default herein. NONDISCRIMINATION I EMPLOYMENT / REPORTING 24. Triangle shall ensure that no person shall on the grounds of race, color, religion, sex, handicap, or national origin be excluded from participation in, be denied the benefits of, or be subjected to discrimination under any program or activity conducted in whole or in part on the land provided under this Contract. Additionally: (a) To the greatest extent feasible, opportunities for training and employment adsing in connection with the planning and carrying out of any project on the land granted under this Contract will be given to Port Arthur residents; and (b) To the greatest extent feasible, contracts for work to be performed in connection with any such project be awarded to Port Arthur residents and businesses, including, but not iimited to, individuals or firms doing business in the field of planning, consulting, design, architecture, building construction, rehabilitation, maintenance, or repair, which are located in or owned in substantial part by persons residing in the City of Port Arthur. (c) If Triangle advertises for employment in any media then it will advertise in the "Port Arthur News". LEGAL AUTHORITY 25. Triangle assures and guarantees that Triangle possesses legal and/or corporate authority to enter into this Contract, receive land authorized by this Contract, and to perform the services Triangle has obligated to perform hereunder and has provided, and will in the future provide, as requested by the PAEDC, such corporate resolutions necessary to evidence this authority. 26. The person or persons signing and executing this Contract on behalf of Triangle, or representing themselves as signing and executing this Contract on behalf of Triangle, do hereby warrant and guarantee that he, she or they have been duly authorized by Triangle to execute this Contract on behalf of Triangle and to validly and legally bind Triangle to all terms, performances, and provisions herein set forth. NOTICE OF LEGAL OR REGULATORY CLAIMS AGAINST TRIANGLE 27. Triangle shall give PAEDC immediate notice in writing of 1) any legal or regulatory action, including any proceeding before an administrative agency filed against Triangle, dirsctly or indirectly; and 2) any material claim against Tdangle, which may impact continued operations. For purposes herein, "material" claims shall mean claims in excess of $15,000. Except as otherwise directed by PAEDC, Tdangle shall furnish immediately to PAEDC copies of all pertinent documentation of any kind received by Triangle with respect to such action or claim. CHANGES AND AMENDMENTS 28. Except as specifically provided otherwise in this Contract, any alterations, additions, or deletions to the terms of this Contract shall be by amendment in wdting and executed by all padies to this Contract. 29. It is understood and agreed by the parties hereto that performances under this Contract must be rendered in accordance with Article 5190.6 V.T.C.A. (the Development Corporation act of 1979), the regulations promulgated under Article 5190.6 V.T.C.A., the assurances and certifications made to PAEDC by Triangle, and the assurances and certifications made to the City of Port Arthur with regard to the operation of the PAEDC's Projects~ Based on these considerations, and in order to ensure the legal and effective performance of this Contract by all parties, it is agreed by the parties hereto that the performances under this Contract ara by the provisions of the PAEDC Program and any amendments thereto and may further be amended in the following manner: PAEDC may from time to time during the period of performance of this Contract issue policy directives which serve to ,~nterpret .~?...~larif7 pe(format~,~...qe, qu!rer~ent~ U.r~der..tl).j~...C~q'~ract consistent with the intent of the parties. Such policy directives shall be promulgated by the PAEDC Board of Directors in the form of PAEDC issuances, shall be approved by the City Council and shall have the effect of qualifying the terms of this Contract and shall be binding upon Triangle, as if written herein. 30. Any alterations, additions, or deletions to the terms of this Contract which are required by changes in Federal, state law or local law are automatically incorporated into this Contract without written amendment hereto, and shall become effective on the date designated by such law or regulation. Triangle agrees to comply with all Federal, State and local laws whether existing or hereinafter enacted. DEFAULT I TERMINATION 31. In the event of default of any of the obligations of Triangle detailed herein or in the event of breach of any of the representations of or warranties of Triangle either detailed herein or in Triangle's application to the PAEDC, the PAEDC may, at its sole,an~... exclusive option and remedy, terminate this Agreement, in whole or in part. In the event of such termination, but subject to the provisions of Section '10 hereof, in addition to (i) any other remedies available to the PAEDC as provided by the laws of the State of Texas or (ii) any other remedies available to the PAEDC as provided herein, the PAEDC may, at its sole option, utilize one or more of the following actions to resolve or otherwise remedy said default: (a) Declare the Commercial Promissory Note executed in conjunction with this Agreement immediately effective. If Triangle defaults on the note, then the PAEDC may exercise its default remedies provided under collateral documentation executed in conjunction with said Note and this Agreement (b) Exercise any remedies provided herein and/or within the Loan/Collateral Documents; (c) Withhold and;or disallow further PAEDC incentives to Triangle; · 32 n addton to the foregong the parties agree that this Agre~.r~ent may be terminated at any hme when both parbes agree, m wntlng, to the terms and conditions of avaiabletOthe PAEDC as any such voluntary termination. TRIANGLE AUDITS ~a'~ of Texas~ 33. if directed by PAEDC Board, Triangle shall arrange for a compliance audit by a certified public accountant to verify performances reported under this Contract. 34. Triangle shall take all necessary actions to facilitate the performance of any and all such audits, whether annual, mandatory or otherwise requested under this Agreement. - 10- 35. Subject to financial privacy requirements of Triangle and properly designated requests for non-disclosure due to proprietary reasons al~ approved audit reports may be made available for public ,disclosure So the extent required by the Pub!!~ Information Ac._jt. ENVIRONMENTAL CLEARANCE REQUIREMENTS 36. Triangle understands and agrees that by execution of this Contract, Triangle shall be responsible fo~' making all reasonable afro,s in providing to PAEDC all information, concerning this PAEDC funded project, required for PAEDC to meet its responsibilities for environmental review, decision making, and other action which applies to PAEDC in accordance with and to the extent specified in Federal, State and Local Law. Triangle further understands and agrees that Triangle shall make all reasonable efforts to assist PAEDC in handling inquiries and complaints from pemons and agencies seeking redress in relation to environmental reviews covered by approved certifications. ORAL AND WRITTEN CONTRACTS I PRIOR AGREEMENTS 37. All oral and written contracts between the parties to this Contract relating to the subject matter of this Contract that were made prior to the execution of this Contract have been reduced to writing and are contained in this Contract. 38. The documents listed below are hereby made a part of this Contract for all purposes, and constitute promised performances by Triangle and/or PAEDC, as the case may be, in accordance with this Contract: Exhibit"A" Industrial Park Covenants and Restrictions Exhibit "B" Commercial Promissory Note Exhibit "C" Commercial Security Agreement Exhibit"D" Acknowledgment of Swinbank's Pledge by Texas State Bank Exhibit"E' Financing Statement (UCC-l) Exhibit"F" Certification Regarding Lobbying Exhibit"G" Form of Deed Exhibit"H" Special Addendum Exhibit "1" Second Deed of Trust Triangle Application to PAEDC for funding, by reference VENUE 39~ For purposes of litigation that may accrue under this Contract, venue shall lie in Jefferson County, Texas, where substantially all the performance will occur. ADDRESS OF NOTICE AND COMMUNICATIONS City of Port Arthur Section 4A Economic Development Corporation 444 4th Street -II- Port Arthur, Texas 77640 J Al'TN: ,Foyd Bat ste Chief Executive Officer [OjJ~ted:Oebea-ahEchols. Executive Tdangle Waste Solutions~ LLC, .< [ D~eted:, L.L.C. ] t 041 Conrad Sauer Road ...... [ ~mt~d; Saut~ns, L.L.C Houston, TX 77043 (In~erted:,L.kC. ] ATTN: Joe Swinbank CAPTIONS 40. This contract has been supplied with captions to serve only as a guide to the contents. The caption does not control the meaning of any paragraph or in any way determine its interpretation or application. COMPLIANCE WITH FEDERAL~ STATE AND LOCAL LAWS 41. Triangle shall comply with all Federal, State and local laws, statutes, ordinances, resolutions, rules, regulations, orders and decrees of any court or administrative body or tdbunal related to Triangle's activities at the Park and Triangle performance under this Contract. Upon request by PAEDC or by the City, Triangle shall furnish reasonably satisfactory proof of its compliance herewith. CONDITIONS PRECEDENT 42.This contract has no legal consequences unless and until (A) both the PAEDC Board and the City of Port Arthur City Council approve the contract in Jts final form; (B) Joe Swinbank and Donald Poarch execute the Commercial Security Agreement in Exhibit thereby becoming Surety for the performance of this Contract and the collateral promissory note in Exhibit "B"; (C) acknowledgment by Texas State Bank that the Certificate of Deposit purchased by Joe Swinbank and Donald Poarch is pledged to secure the herainabove described contract and note; (D) PAEDC executes and delivers the deed in the form attached hereto as Exhibit "G' attached hereto to Triangle. ATTORNEY APPROVALS APPROVED AS TO FORM: Guy Goodson, General Counsel for PAEDC VERI FIE D AS CO NSISTANT WITH CITY COUNCIL RESOLUTION: Resolution Number: -IS'- Mark T. Sokotow, City Attorney -).3- CONTRACT EXECUTION CITY OF PORT ARTHUR SECTION 4A ECONOMIC DEVELOPMENT CORPORATION SIGNED AND AGREED TO on the day of ,2006. By: By: President Eli Roberts Secretary Linda Spears Witness Witness SIGNED AND AGREED TO on the day of ,2006. TRIANGLE WASTE, pR~.I~ER~'!E.~ I.? . [ Deleted: SOt. UTIONS, L.LC. ] A Texas limited partnership By: Triangle Waste Solutions, LLC its General Partner, a Texas limited liability company By: Joseph B. Swlnbank, President -14- EXHIBIT "A" COVENANTS AND RESTRICTIONS PORT ARTHUR BUSINESS PARK 11/30/05 GENERAL The City of Port Arthur Section 4A Economic Development Corporation (PAEDC) is the owner of the Port Arthur Business Park (Business Park). PAEDC has determined that it is in the best interests of the City of Port Arthur, PAEDC, the Business Park and its future occupants to adopt the following provisions restrictions and covenants to control the development within the business park. CONDITIONS OF SALE Each parcel sold or conveyed to a user by PAEDC is for the purpose of development of facilities and occupancy by a user. Development of facilities (buildings) for user occupancy must be completed within eighteen months of purchase. If there is an incentive agreement with the PAEDC, the construction must be completed within the timetables of the incentive agreement. If construction has not been completed in the period specified, PAEDC shall have the option to repurchase the property on the basis of reversing (or rescinding) thc terms of the original sale, including price. This option may be exercised at any time subsequent to the failure of construction to be completed by the specified date. Exercise of the option will be by formal action of the PAEDC Board. Delivery of written notice of exercise of this option shall be the cause of an immediate halt to actions to develop the parcel by the parcel owner. If the owner or lessee of property in the Business Park wishes to sell or assign thc property to a third party, the owner or lessee shall obtain the approval of the PAEDC Board of Directors, with such approval not to be unreasonably withheld. The owner or lessee shall present information as to the financial and credit information as to the new buyer or assignee and such other information as reasonably requested by the PAEDC Chlef Executive Officer (CEO). The new owner or lessee shall be required to assume the obligations in the incentive agreement, with such changes as are approved by the PAEDC Board &Directors. If the owner or lessee wishes to subdivide and sell or assign only a portion of its property to a third party, the owner or lessee shall obtain the approval of the PAEDC Board of Directors which can deny the request at its discretion. At the discretion &the PAEDC, the PAEDC shall have a first option to repurchase said undeveloped portion for the same cost as delineated in the incentive agreement or sales agreement and in such additional reasonable amounts as to reimburse the owner for monies that he has expended in maintaining said portion of the property. In such case, PAEDC shall have 90 days to notify the owner of its decision in regard to this option. LEGAL DESCRIPTION The Po~t Arthur Business Park includes all land as described in Appendix A, and on such other property as approved by PAEDC. TER3{S AND DEFINITIONS For the purposes of these covenants and restrictions, certain terms, phrases, words and their derivatives shall have their meaning as specified in 'this section. Where terms are not defined, they shall have their ordinary accepted meanings within the context with which they are used. Webster's Ninth New Collegiate Dictionary, Copyright 1987, shall be considered as providing ordinary accepted meaning. (1) Board. City of Port Arthur Section 4A Economic Development Corporation Board of Directors. (2) Building. Any structure built for the support, shelter and enclosure of persons, animals, chattels or movable property of any kind. When subdivided in a manner sufficient to prevent the spread of fire, each portion so subdivided may be deemed a separate building. (3) City council. ThegoverningandlegislativebodyoftheCityofPortArthur. (4) District. A section of the City of Por~ Arthur for which the regulations governing the · height, area or use of the land and buildings are uniform. (5) Height. The vertical distance of a building measured from the average established grade at the street line or from the average natural front yard ground level, whichever is higher, to (1) the highest point of the root's surface if a flat surface; (2) to the deck line of mansard roofs; or (3) to the mean height level between eaves and ridge for hip and gable roofs, and, in any event, excluding chimneys, cooling towers, elevator bulkheads, penthouses, tanks, water towers, radio towers, ornamental cupolas, domes or spires and parapet wails not exceeding ten feet in height. If the street grade has not been officially established, the average front yard shall be used for a base level. (6) Lot. Land occupied or to be occupied by a building and its accessory buildings, and including such open spaces as are required under these covenants and restrictions and having its principal frontage upon a public street or officially approved place. (7) Occupancy. The use or intended use ofthe land or buildings by proprietors or tenants. (8) Planning and zoning commission. The agency designated in the City Charter as the planning commission and appointed by the city council as an advisory body to it and which is authorized to recommend changes in the zoning ordinance. (9) Parldng lot or structure, commercial (motor vehicle.). An area or structure devoted to the parking or storage of motor vehicles. May include, in the case of a parking structure only, a facility for servicing of motor vehicles provided such facility is primarily an internal function for use only by motor vehicles occupying the structure and creates no special problems of ingress or egress. (10) Structure. Any structure built for the support, shelter and enclosure of persons, animals, chattels or movable property of any kind. When subdivided in a manner sufficient to prevent the spread of fire, each portion so subdivided may be deemed a separate building. COVENANTS & RESTRICTIONS - 1/9/O5 Page 2 of 13 (11) Yard. An open space other than a court, on the lot in which a building is situated and which is not obstructed from a point 30 inches above the general ground level of the graded lot to the sky, except as provided for roof overhang and similar features and for the usual trees and landscape planting. (12) Yard, front. An open, unoccupied space on a lot facing a street extending across the ~ront of the lot between the side lot lines and from the front face of the building to the front lot or street line with the minimum horizontal distance between the street line and the main building line as specified for the district in which it is located. The front face of the building shall not necessarily be determined by the primary access to the building or any unit therein. (13) Yard, rear. An open, unoccupied space, except for permitted detached accessory buildings, trees and planting, extending across the rear ora lot from one side lot line to the other side lot line and having a depth between the building and thc rear lot line. (14) Yard, side. An open, unoccupied space or spaces on one or two sides of a main building situated between the building and a side line of the lot and extending through from the front yard to the rear yard. Any lot line not the rear line or a front line shall be deemed a side line. REVIEW AND APPROVAL OF USES AND IMPROVEMENTS All uses that occupy parcels and all facilities and improvements constructed in the park (including all alterations and additions to the site and such facilities and improvements) shall be subject to approval by PAEDC and may require approval by the City of Port Arthur. PAEDC and the City may at their sole discretion involve other parties in the review of proposed uses and improvements. In cases where specialized evaluations are deemed necessary, PAEDC may require a fee to cover the cost of the services of consultants engaged to perform these evaluations. No construction may be initiated upon any parcel in the Business Park until approval bas been granted by PAEDC (and where required, by the City of Port Arthur). Failure of the user of a parcel to seek approval for development plans in a timely manner will not be the basis for granting an extension as to the timetable for construction. Approval means formal action by the PAEDC Board, (and where required by City Council of the City of Port Arthur) and the receipt of written confirmation of approval from a competent authority of these bodies. Application for approval shall be made in writing and must contain all submission requirements specified by PAEDC. Such requirements will include site plans, building plans and specifications, and other such information as PAEDC and the City may request. COVENANTS & RESTRICTIONS - 1~9f05 pege 3 of 13 PEI~MITTED OCCUPANCIES Sites and facilities within the Business Park may be occupied by the uses specified in the following chart (Parcels are as designated on the Business Park Final Plat). Parcels 1, 2, 3, 5, 7 & 9 - Office, warehouse, distribution, light fabrication and assembly, recycling, manufacturing and other approved uses. Parcel 4 & 8 - Office and other approved uses. Parcel 6, 10 - Warehouse, distribution, manufacturing, assembly and other approved USes. Other uses may be approved by PAEDC at its sole discretion which includes career centers and other types of development as approved by the PAEDC and as authorized by State Law. All occupancies permitted may be subject to additional restrictions imposed as a result of review of user applications provided that such specific requirements are intended to implement the restrictions previously established by the PAEDC in these Covenants and Restrictions or subsequent amendments. PROHIBITED OCCUPANCIES Specifically prohibited uses include manufacturing and process operations that transmit noise, or release odors, fumes or dust that materially exceed City, State, or Federal Standards or discharge a waste stream that is not acceptable (due to content or volume) for the City's sanitary sewer system. Any use that requires onsite treatment of waste in order to meet the above requirements will be allowed only on the basis of a special use permit from PAEDC, the City of Port Arthur, the TCEQ or the applicable regulatory agency. In general, on site treatment of significant quantities of special waste will not be permitted. A special use permit may, at the sole discretion of PAEDC, be granted, conditional upon continued and demonstrative conformance to specific requirements and standards. Failure by the user receiving such conditional approval to strictly conform to the requirements and standards imposed wilt be the basis of termination of the special use permit, without recourse by the user. Notice of termination of any permit required by any regulatory agency (including the City) will require the user to immediately cease all onsite processes that generate or contribute to the subject waste stream. In addition, all exterior site uses including parking areas, truck maneuvering and docking areas, storage and equipment yards and the like will be developed and maintained in strict conformance with these covenants and restrictions and with the specific terms of approvals granted by PAEDC and the City of Port Arthur. COVENANTS & RES'TRICTIONS o 1/9/05 Page 4 o! 13 CONSTRUCTION STANDARDS, CODES AND ORDINANCES All improvements constructed in the Business Park shall meet or exceed the standards and ordinances of the City of Port Arthur, State of Texas statutes and regulations, and national standards. It shall be the duty of the user of any parcel in the Business Park to conform to such requirements and to obtain all approvals and permits granted by governing authorities. Such requirements include but are not limited to City Building Permits and local drainage, environmental and utility requirements. Review and approval by PAEDC and the City of Port Arthur under the above provisions for Review and Approval of Uses and Improvements does not relieve or mitigate in any way this separate duty of the user. The owners or lessees of the property shall take such precautions as to commence and complete the improvements wherein laborers, subcontractors and contractors are promptly paid with no materials and mechanic's liens being filed on the property. Prior to commencing constmcfion, the owner or lessee shall provide to the PAEDC such evidence of financial ability to complete the project, which may include letters of eredit, and contractor's performance bonds and payment bonds. PROPERTY MAIuNTENANCE Owners and Users of parcels and improvements shall perform regular and routine maintenance on these properties. Undeveloped parcels shall be kept mowed and free of debris. Developed parcels (including site and facilities) shall be maintained in a manner consistent with the users' approved proposal for use and improvements. Lawns and landscaping shall be kept flee of overgrowth, trash and debris. Parking or storage of vehicles, equipment or materials in areas other than approved outdoor storage is prohibited. Areas shall be maintained fi-ee of trash, sediment, debris, and abandoned or unsightly equipment. Outdoor storage areas other than those approved by PAEDC are prohibited. Approved outdoor storage areas shall be well maintained and shall be kept neat and orderly in appearance. Only materials and equipment that are in active use at the site may be stored on site. Storage of derelict or junked materials, equipment or vehicles onsite is prohibited. Buildings and other structures shall be kept in an attractive condition. Exterior surfaces shall be washed and painted as required to maintain a fresh appearance. Exterior materials that deteriorate shall be replaced. No open burning of rubbish is permitted on the site. All waste material shall be confined to trash receptacles in approved and screened locations for removal from the site. In case of fire or damage from other causes, the owner or lessee shall restore the improvements within nine (9) months unless granted an extension by pAFDC. COVENANTS & ~ESTRICTIONS - I/9~ Page5of 13 INSURANCE The lot owners and lessees shall maintain casualty insurance in an amount sufficient to replace the buildings. A copy of the certificate oflnsurance shall be given to the PAEDC and the PAEDC shall be listed as an additional insured. If the lot owner or lessee fails to maintain or pay for the insurance, the PAEDC (in its sole discretion) may pay for the costs thereof, assess the lot owners and lessees, and file liens. ASSESSMENT The lessees and private owners of the land in the Business Park shall pay assessments to the PAEDC for the maintenance of the street signage and landscaping, the costs to enforce these deed restrictions, and the costs to maintain business park, such assessments shall be a minimum of $200 per acre per year and shall be payable on or before December 31~ of each year. Additional assessments, as determined by the PAEDC Board of Directors' shall not exceed the actual proportionate share of the expenditures made by the PAEDC plus a 10% administrative fee. The proportionate share shall be the number of acres owned or leased divided by 246. CONTINUATIONS~ AMENDMENT AND VARIATION OF COVENANTS AND RESTRICTIONS These covenants and restrictions shall remain in force on all parcels and shall be binding on all current and future owners and lessees of parcels within the Business Park. Variation in these covenants and restrictions is limited to one of the following methods: PAEDC (subject to the approval of thc City of Port Arthur) may fi.om time to time amend the provisions, covenants and restrictions. PAEDC may in its sole discretion grant variances to these provisions, covenants and restrictions as a part of the approval of the Review and Approval of Use and Improvement process. Such variances must be requested in writing by the user of the parcel. PAEDC will notify all adjacent parcel owners of the request for variation by posting such notice and will receive and consider comments from such parcel owners in evaluating such vax/ances. It is the intent of PAEDC to maintain the general character and intent of the provisions, covenants and restrictions and to comply with Article 5190.6 V.T.C.A. COVENANTS &RESTRICTtON$- 1/9/05 Page6of 13 SITE DEVELOPMENT Building sites of individual users must be planned to have an attractive image and must be well ma/ntained. The following requirements shall apply to the development of sites within the Business Park: CateRor~ ~$rq.U_lremen~ Set Backs Building Street Frontage 45 feet Side and rear lot lines 15 feet Paving Street Frontage 20 feet Side and rear lot lines No requirement Landscaping All non paved areas Maintained lawns Street Fmnta ~e 1 tree per 100 feet of frontage - 2 inch caliper Paving Parking Automobile :Concrete Tracks and Trailers Concrete Aprons and maneuvering areas Concrete Access and Entry As approved by PAEDC May not conflict with street traffic or access to adjacent sites. Utilities All connections and service underground and; Equipment (transformers etc.) screened from public view Outdoor Not allowed forward of the line of the building face Yards and Fully screened from frontage with harms, planting or Storage walls constructed in conformance with standards for Ares front face of buildings Area Parcels 1~ 2, 3, 5, 7, 9 No larger than the area &the building Limitations Parcels 4, 8 Not permitted Parcel 6, 10 No limit Fencing Side and rear yards only Visible fi'om Street Decorative iron or as approved by PAEDC (no wood fences permitted) Side and rear Chain link or as approved by PAEDC (no wood fences permitted) Ancillary Structures and Equipment Constructed to meet applicable building standards Tanks, trash receptacles and other equipment screened fi'om public view Mail boxes as approved by PAEDC Flagpoles as approved by PAEDC Lighting Pole or building mounted lighting All lighting will be natural in color (no uncorrected high pressure sodium fixtures) Lighting must be controlled to prevent glare as seen from adjacent public ways and adjacent properties COVENANTS & RESTRICTIONS - 119/05 Page 7 of 13 SITE DEVELOPMENT Categ__q~ Drainage Surface drainage must be controlled within site boundaries. Discharge into drainage ways as approved by responsible authorities, Signage All signs must be approved by PAEDC May be internally or externally illuminated Ma}, not be animated Site Mounted Signs Maximum of 6 feet in height Base no more than 2 feet above ground No closer then 10 feet to property line Compatible with building color and materials Integrated and compatible with landscaping Building Mounted Signs Not painted on building May not extend beyond building profile Must be compatible is size, color and material with building BUILDING DESIGN AND CONSTRUCTION Building design including all exterior materials and colors must be attractive, compat~le with adjacent development and be aPProved by the PAEDC. Exterior Materials Excepl for trim and accents, no wood will be permitted Walls Facing Frontage and Public Wa}'s Concrete or masonry Walls Facing Side and Parcel 1, 2, 3, Concrete, masonry, or metal panels Rear Yards 5, 6, 7, 9, 10 Parcel 4, 8 Concrete or masonry Roofing Materials Any roof surface that is exposed to public view must be approved by PAEDC Rooftop equipment No more than five feet in height and screened from public view Awnings and Canopies Compatible with building design and approved by PAEDC Exterior Colors Exterior surfaces will be predominately neutral or natural colom Iright accent or trim colors will be considered by the PAEDC. COVENANTS & RESTRICTIONS- 119/05 Page 8 of 13 ENFORCEI~IENT OF COVENANTS .4aND RESTRICTIONS Determination regarding the meaning, applicability and enforcement of these covenants and restrictions is the sole domain of PAEDC Board of Directors. Inquiry in regard Jo such matters shall be made to PAEDC in writing. A determination rendered in writing by PAEDC Board of Directors shall be deemed final and binding on all parties. Enforcement of the provisions, covenants and restrictions shall be in accordance with law or through civil or criminal proceedings initiated by PAEDC or by the City of Port Arthur. Enforcement action may include but is not limited to restraint of violations, recovery of costs, attorneys fees and damages, assessments, fines, civil penalties, foreclosure, and judicial sale. COVENANTS & RESTRICTIONS - 1/9~)5 Page 9 of 13 APPENDIX "A" DESCRIPTION OF A 297.960 ACRE TRACT OR PARCEL OF LAND OUT OF AND PART OF THE WM. McFADDIN SURVEY, ABSTRACT NO. 416, THE T. & N.O.R.R. SURVEY, SECTION NO. 5, ABSTRACT NO. 238, AND THE T. & N.O.R.R. SURVEY, SECTION NO. 9, ABSTRACT NO. 242 JEFFERSON COUNTY, TEXAS AUGUST 20, 2001 All that cedain tract or parcel of Iand lying and being situated in Jefferson County, Texas, parts of the WM. McFADDIN SURVEY, ABSTRACT NO. 416, the T. & N.O.R.R. SURVEY, SECTION NO. 5, ABSTRACT NO. 238, and the T. & N.O.R.R. SURVEY, SECTION NO. 9, ABSTRACT NO. 242, and being parts of Blocks 14, 15 and 16, Range N, Blocks 14, 15 and 16, Range O, and Blocks 15 and 16, Range P of the Lands of the Port Arthur Land Co., the plat of which said subdivision is of record in Volume 1, Page 22 of the Map Records of Jefferson County, Texas, and being a part of that certain tract of land herein referred to as the "McFaddin and Cordts" tract, which said McFaddin and Cordts tract is designated "TRACT NO. 18-C" and is described in that cedain instrument from W.P.H. McFaddin, Jr., and J.L.C. McFaddin, as Trustees of the McFaddin Trust to J.L.C. McFaddin, Di McFaddin Houk, Perry McFaddin Duncan, W.P.H. McFaddin Jr., Mamie McFaddin Ward, Camelia B. McFaddin and Di Vernon McFaddin Cordts, W.P.H. McFaddin Jr., and J.L.C. McFaddin, jointly, and Mamie McFaddin Ward, W.P.H. McFaddin, Jr., J.L.C. McFaddin, and Camelia B. McFaddin and Di Vernon McFaddin Cordts, jointly, dated February 26, 1948 and recorded in Volume 692, Page 22 of the Deed Records of Jefferson County, Texas, and which said TRACT NO. 18-C is indicated on that certain plat entitled "PARTITION MAP NO. 3 OF THE McFADDIN TRUST PROPERTY IN JEFFERSON COUNTY, TEXAS ... "which said plat is of record in Volume 8, Page 110 of the Map Records of Jefferson County, Texas, and being a part of that cedain tract of land herein referred to as the "Cordts" tract, which said Cordts tract is described in that certain instrument from E.G. Cordts, Jr., Independent Executor of the Estate of Di Vernon McFaddin Bedy to E.G. Cordts, Jr., Colleen Clave Cordts and Anna Camelia Cordts, dated September 13, 1994 and recorded under County Clerk's File No. 94-9432523 of the Official Public Records of Real Property of Jefferson County, Texas, and the said tract herein described being that exact same cedain tract of land herein referred to as the "PAEDC" tract, which said PAEDC tract is described in that cedain instrument from E.G. Cordts, Jr., ..., Colleen Clare Cordts Rice ..... and Anna Camelia Cordts Edwardson .... to Port Arthur Economic Development Corporation, dated February 28, 2001 and recorded under County Clerk's File No. 2001007554 of the Official Public Records of Real Property of Jefferson County, Texas, and the said tract herein described being more particularly described as follows: BEGINNING at a iron rod with a Texas Department of Transportation aluminum cap (TxDOT Type 1 Monument) found for the southeast corner of the said tract herein COVENANTS & RESTRICTIONS - 1/9105 Page 10 of 13 described, the said comer being the southeast corner of the said PAEDC tract, and the said corner also being the mest southerly southwest comer of that certain tract of land herein referred to as the "Parcel 31" tract, which said Parcel 31 tract is so designated and is described in that certain instrument from E.G. Cordts, Jr., Colleen Clara Cordts Rice and Anna Camelia Cordts Edwardson to Jefferson County, dated Mamh 15, 1999 and recorded under County Clerk's File No. 1999009190 of the Official Public Records of Real Property of Jefferson County, Texas, and the said corner being in the north line of that certain tract of land herein referred to as the "Parcel 32" tract, which said Parcel 32 tract is so designated and is described in that certain instrument from The Mamie McFaddin Ward Hedtage Foundation to Jefferson County, dated December 12, 1990 and recorded under County Clerk's File No. 96-9638512 of the Official Public Records of Real Property of Jefferson County, Texas, the said comer being an intedor angle point comer in the southwesterly right-of-way line of Texas State Highway Spur 93, and the said TxDOT Type I Monument found for corner being East (Assumed Basis of Beadngs - called South 89° 37' 00" East) along and with the south line of the said PAEDC tract, said north line of the Parcel 32 tract and north line of that certain tract of land herein referred to as the "Ward" tract, which said Ward tract is designated ".TRACT NO. 19-C" and is described in the hereinbefore referenced instrument recorded in Volume 692, Page 22 of the Deed Records of Jefferson County, Texas, and which said TRACT NO. 19-C is indicated on the hereinbefore referenced plat of record in Volume 8, Page 110 of the Map Records of Jefferson County, Texas, a total distance of 5,430.99 feet (called 5,431.07 feet) from a 5/8" iron rod with a yellow cap stamped "RPLS 3636" found for reference; THENCE West (called North 89° 37' 00" West) along and with the said south line of the PAEDC tract, nodh line of the Parcel 32 tract and north line of the Ward tract, passing at a distance of 16.92 feet (called 16.92 feet) a 5/8" iron rod found for the most northerly northwest comer of the said Parcel 32 tract, the said comer being an exterior angle point corner in the said southwesterly right-of-way line of Texas State Highway Spur 93, and passing at a distance of 4,938.57 feet (called 4,938.91 feet) a 518" iron rod with a yellow cap stamped "RPLS 3636" found for reference at the southeast comer of that cedain tract of land herein referred to as the "TRACT 196-A" tract, which said TRACT 196-A tract is so designated and is described in that cedain instrument (titled "RIGHT-OF-WAY EASEMENT") from Di Vernon McFaddin Kib0deaux, formerly Di Vernon McFaddin Cordts, joined therein by her husband, Oren J. Kibodeaux to Jefferson County Drainage District No. 7 dated January 4, 1968 and recorded in Volume 1531, Page 123 of the Deed Records of Jefferson County Texas, and passing at a distance of 5,430.99 feet (called 5,431.07 feet) the hereinbefore said 518" iron rod with a yellow cap stamped "RPLS 3636" found for reference at the southwest comer of the said TRACT 196-A tract, and continuing (West) along and with the said south line of the PAEDC tract and north line of the Ward tract, a total distance of 5,545.27 feet (called 5,545.35 feet) to a point for the southwest comer of the said tract herein described, the said corner being the southwest corner of the said PAEDC tract, and the said comer also being the northwest comer of the said Ward tract, and the said comer being in the eastedy line of that cedain tract of land herein referred to as the "TRACT A" tract, which said TRACT A tract is so designated and is described in that certain instrument from Dading Klaver, et al to Jefferson County Drainage District No. 7 dated November 22, 1971 and recorded in Volume 1727, Page 481 of the Deed Records of Jefferson County, Texas, and the said comer being in the centedine of Rhodiar Gully; COVENANTS & RESTRICTIONS - 1/9/05 Page 11 of 13 THENCE Nodh i2° 17' 39" West (called North 11° 54' 13" West) along and with the westedy line of the said PAEDC tract, the said easterly line of the TRACT A tract and said centerline of Rhodair Gully, a distance of 724.96 feet (called 724.92 feet) to a point for the most westerly northwest comer of the said tract herein described, the said comer being the most westerly nodhwest comer of the said PAEDC tract, and the said comer also being the most southerly comer of that cedain tract of land heroin referred to as the "J.L.C. McFaddin" tract, which said J.L.C. McFaddin tract is designated "TRACT NO. 12-C" and is described in the hereinbefore referenced instrument recorded in Volume 692, Page 22 of.the Deed Records of Jefferson County, Texas, and which said TRACT NO. 12-C is indicated on the hereinbefore referenced plat of record in Volume 8, Page 110 of the Map Records of Jefferson County, Texas; THENCE North 39° 57' 00" East (called North 40° 20' 00" East) along and with the most westedy northwest tine of the said PAEDC tract and most southerly southeast line of the said J.L.C. McFaddin tract, passing at a distance of 132.53 feet (called 132.53 feet) a 5/8" iron rod with a yellow cap stamped "RPLS 3636" found for reference at the northwest. comer of the hereinbefore said TRACT 196-A tract, and passing at a distance of 736.10 feet (called 735.85 feet) a 5/8" iron rod with a red plastic cap stamped "S&P INC" set for reference at the northeast comer of the said TRACT 196-A tract (and which said 5/8" iron rod with a red plastic cap set for reference is North 37° 58' 15" West a distance of 0.39 feet from a 5/8" iron rod with a yellow cap stamped "RPLS 3636" found for reference), and continuing (North 39° 57' 00" Ease) along and with the said mcst westedy northwest line of the PAEDC tract and most southerly southeast line of the J.L.C. McFaddin tract, a total distance of 3,925.49 feet (called 3,925.61 feet) to a W' iron rod found for the most northerly comer of the said tract herein described, the said corner being the most nodhedy comer of the said PAEDC tract, and the said corner also being the most westedy comer of that cedain tract of land herein referred to as the "Bamette - 1483/177" tract, which said Bamette - 1483/177 tract is described in that cedain instrument from Gulf Refining Company to N.K. Barnette, Jr. dated October 24, 1966 and recorded in Volume 1483, Page 177 of the Deed Records of Jefferson County, Texas; THENCE South 49° 46' 07" East (called South 49° 23' 24" East) along and with the most northerly northeast line of said PAEDC tract and southwesterly line of the said Bartnette - 1483/177 tract, a distance of 1,317.60 feet (caIled 1,317.54 feet) to a ~" iron rod found for an intedor comer of the said tract herein described, the said comer being an intedor corner of the said PAEDC tract, and the said corner also being the most southerly comer of the said Bamette - 1483/177 tract; THENCE North 40° 07' 58" East (called North 40° 33' 04" East) along and with the most eastedy northwest line of the said PAEDC tract and southeasterly line of the said Barnette - 1483/177 tract, a distance of 151.95 feet (called 151.86 feet) to a 5/8" iron rod with a yellow cap stamped "RPLS 3636" found for the most eastedy northwest comer of the said tract herein described, the said comer being the most eastedy northwest comer of the said PAEDC tract, and the said comer also being the most westerly comer of that certain tract of land herein referred to as the "Bamette - 1483/176" tract, which said Bamette - 1483/176 tract is described in that cedain instrument from Di Vernon McFaddin Cordts joined therein by her husband, Edwin G. Cordts to N.K. Barnette, Jr. dated October 11, 1966 COVENANTS & RESTRICTIONS - 1/9/05 Page 12 of 13 and recorded in Volume 1483, Page 176 of the Deed Records of Jefferson County, Texas, and the said 518" iron rod with a yeIIow cap stamped "RPLS 3636" found for comer being South 400 11' 19" West (called South 40° 33' 04" West) along and with the said southeasterly line of the Barnet~e - 1483/177 tract, northwesterly line of the said Bamette - 1483/176 tract and southeasterly line of that certain tract of land herein referred to as the "LNVA" tract, which said LNVA tract is described in that certain instrument from Gulf Refining Company to the Lower Neches Valley Authority dated Apdl 8, 1975 and recorded in Volume 1876, Page 290 of the Deed Records of Jefferson County, Texas, a total distance of 499.44 feet (called 500.00 feet) from a 5/8" iron rod found for the most northerly comer of the said Bamette - 1483/176 tract, the said corner also being the most eastedy comer of the said LNVA tract, and the said corner being in the hereinbefore said southwesterly right-of- way line of Texas State Highway Spur 93; THENCE South 83° 44' 08" East (called South 83° 21' 35" East) along and with the most eastedy nodh line of the said PAEDC tract and southerly line of the said Bamette - 1483/176 tract, a dista nce of 557.12 feet (called 557.12 feet) to a 5/8" iron rod found for the most northerly northeast comer of the said tract herein described, the said comer being the most northerly northeast corner of the said PAEDC tract, ar~l the said comer also being the most nodherly northwest comer of the hereinbefore said Parcel 31 tract, and the said corner being in the said southwesterly right-of-way line of Texas State Highway Spur 93, and the said 5/8" iron rod found for corner being South 27° 38' 14" East (called South 27° 11' 44" East) along and with the said southwesterly right-of-way line of Texas State Highway Spur 93, a distance of 499.26 feet (called 499.56 feet) from the hereinbefore said 5~8" iron rod found for the most northerly corner of the Barnette - 1483/176 tract and most eastedy comer of the LNVA tract; THENCE South 27° 30' 14" East (called South 27° 07' 03" East) along and with the most eastedy northeast line of the said PAEDC tract, southwesterly line of the said Parcel 31 tract and said southwesterly right-or-way line of Texas State Highway Spur 93, a total distance of 3,294.33 feet (called 3,294.40 feet) to the Point of Beginning and Containing 297.960 acres (cailed 297.9732 acres) of land, more or less. Prepared by Schaumburg & Polk, Inc. E. James Verrett, Registered Professional Land Surveyor No. 1781 COV£NANTS & RESTRICTIONS - 1/9~05 Page 13 of 13 EXHIBIT"B" CONDITIONAL COMMERCIAL PROMISSORY NOTE Port Arthur, Texas This CONDITIONAL COMMERCIAL PROMISSORY NOTE becomes effective on the date when Tdangle W..aste, Properties LP_, herein_afl_er_c~e_d "_Ma_ke_r,'_bre_ac_he_s _an_d r_ec_elv_es._ written notification f~om ~-e~-d~ adTv-lsing of such breach and the effectiveness of this note that certain Economic Incentive Contract and Loan Agreement between the City of Port Arthur Section 4A Economic Development Corporation (hereinafter called 'Lender') and Maker, dated ,2006. Effective Date: the day of , 200 .('date of breach and receipt of written nc~tificafion from Lender advising of same') Principal Amount: $ , which is $392,040 plus ,an_y_,ye_.ar~_ca_sh_ incentive payments made to Maker (not to exceed $500,000) minus the incentive credits earned by Maker according to that certain Economic Incentive Contract and Loan Agreement between the Lender and Maker (described hereinbefore), Term of the Loan: Three years from effective date. Payment Schedule: Monthly until principal is paid fully. FOR VALUE RECEIVED, the undersigned "Maker", whether one or more, and if more than one, then jointly and severally, promise(s) to pay to the order of CITY OF PORT ARTHUR SECTION 4A ECONOMIC DEVELOPMENT CORPORATION, (herein called "Lender'), at its office at P,O. Box 1089, Port Arthur, Texas 77640-1089, or such other place or places as the holder hereof shall from time to time designate in written notice to Maker, the principle amount, in legal and lawful money of the United States of Amedca, together with interest thereon from the date effective hereof until maturity at the rate of ten percent (10%) per annum as detailed herein. All past due principal and interest shall bear interest from date of maturity until paid lat the rate of fifteen percent (15%) per annum, or to the mayJmum non-usurious ,amount allowed by_law(w, hichever is less.~ as may hereafter be in effect, pay_able on demand after maturity. . This note is due and payable as follows: Monthly on the 1'~ of each month, starting the month immediately following the month the Note became effective. The amount of monthly payment will be a payment of principaLa_nd_in_teres._t s_u_ffic_ientto_fu_lly...~ amortize the principal amount of this Note by its maturity date. Any notices required or permitted to be given by the holder hereof to Maker pursuant to the provisions of this note shall be in writing and shall be either personally delivered or transmitted by first class United States mail, addressed to Maker at the address designated below for receipt of notice (or at such other address as Maker may, from time to time, designate in writing to the holder hereof for receipt of notices hereunder). Any such nofice personally delivered shall be effective as of the date of delivery, and any nctJce transmitted by mail, in accordance with the foregoing provisions, shall be deemed to have been given to and received by Maker as of the date on which such notice was deposited with the United States Postal Service, propedy addressed and with postage prepaid. This note is also secured by end entitled to the benefits of all other security agreements, pledges,p_ssi_gnments, ....................... and lien instruments covering_certificates of de. DosE or other personal property only.executed by Maker or b_.y anyother p_art~/as securi_ty for any loans owing by Maker to the-Le~d~r~- ~u~h'~ie-~ insTtrume-nt~ s-hall i-~cl-ed'~ t-ho-se- executed simultaneously herewith, those heretofore executed, and those hereafter executed. No liens covering any real property shall serve as security for this note except for a second lien deed of trust from Maker to Lender covering Lot 4 in Block I on South Business Park Drive, Port Arthur, Texas 77640, for an indebtedness not to exceed $500,000. If any installment or payment of principal or interest of this note is not paid when due or any drawer, accepter, endorser,~u_re_.f.ty,_ac_co_mm_od_ati_on_pa_rty_er_ot_her p_ers_on_n_ow_ or hereafter primarily or secondarily liable upon or for payment of all or any part of this note (each hereinafter called an "other liable party"} shall die, or become insolvent (however such insolvency may be evidenced); or if any proceeding, procedure or remedy supplementary to or in enforcement of judgment shall be resorted to or commenced against Maker or any other liable party, or with respect to any property of any of them; or if any governmental authority or any court at the instance thereof shall take possession of any substantial part of the propedy of or assume control over the affairs or operations of, or a receiver shall be appointed for or take possession of the property of, or a writ or order of attachment or garnishment shall be issued or made against any of the property of Maker or any other liable party; or if any indebtedness for which Maker or any other liable party is primarily or secondarily liable-shall not be paid when due or shall become due and payable by acceleration of maturity thereof, or if any event or condition shall occur which shall permit the holder of any such indebtedness to declare it due and payable upon the lapse of time, giving of notice or otherwise; or if Maker or any other liable party (if other than a natural person) shall be dissolved, wound up, liquidated or otherwise terminated, or a party to any merger or consolidation without the written consent of Lender; or if Maker or any other liable party shall sell substantially all or an integral portion of its assets without the written consent of Lender; or if Maker or any other liable party fails to furnish financial information requested by Lender;, or if Maker or any other liable party furnishes or has furnished any financial or other information or statements which are misleading in any respect; or if a default occurs under any instrument now or hereafter executed in connection with or as security for this note;_th_ere_uE.on~ a_t t_he_ o_pti_on_of_ L_en_der_, t_he_ principal balance and accrued interest of this note and any and all other iddebtedness of Maker to Lender shall become and be due and payable fodhwith without demand, notice of default, notice of acceleration, notice of intent to accelerate the maturity hereof, notice of nonpayment, presentment, protest or notice of dishonor, all of which are hereby expressly waived by Maker and each other liable party. Lender may waive any default without waiving any prior or subsequent default. If this note is not paid at maturity whether by acceleration or otherwise, and is placed in the hands of any attorney for collection, or suit is filed hereon, or proceedings are had in probate, bankruptcy, receivership, reorganization, arrangement or other legal proceedings for collection hereof, Maker and each other tiab{e party agree to pay Lender its collection costs, including court costs and a reasonable amount for attorney's fees. It is the intention of Maker and Lender to conform stdctly to applicable usuq/laws. Accordingly, if the transaction contemplated hereby would be usudous under applicable law, then, in that event, notwithstanding anything to the contrary herein or in any agreement entered into in connection with or as security for this note, it is agreed as follows: (i) the aggregate of all consideration which constitutes interest under applicable law that is taken, reserved, contracted for, charged or received under this note or under any of the other aforesaid agreements or otherwise in connection with this note shall under no circumstances exceed the maximum amount of interest allowed by applicable law, and any excess shall be credited on this note by the holder hereof (or, if this note shall have been paid in full, refunded to Maker); (ii) in the event that maturity of this note is accelerated by reason of an election by the holder hereof resulting from any default hereunder or otherwise, or in the event of any required or permitted prepayment, then such consideration that constitutes interest may never include more than the maximum amount allowed by applicable law, and excess interest, if any, provided for in this note or otherwise shall be canceled automatically as of the date of such acceleration or prepayment and, if theretofore prepaid, shall be credited on this note (or if this note shall have been paid in full, refunded to Maker); and ([ii) all calculations of the rate of interest taken, reserved, contrasted for, charged or received under this note or under any of the other aforesaid agreements or otherwise in connection with this note, that are made for the purpose of determining whether such rate exceeds the maximum lawful rate shall be made, to the extent permitted by applicable law, by amortizing, prorating, allocating, and spreading such interest over the eh!ire term of the loan evidenced by this note(including all renewal and extended terms). Maker may prepay all or any part of the principal of this note before matudty without penalty. No padial prepayment shall reduce, postpone or delay the obligation of Maker to continue paying the installments herein provided on their respective due dates following any such padial prepayment until this note is fully paid. The Maker and each other liable party are and shall be directly and primarily, jointly and severally, liable for the payment of all sums called for hereunder; and, except for Inotices specifically required to be given by the holder hereof to Maker, except as otherwise expressly provided herein, pursuant to the eadier provisions of this note, Maker and each other iiable party hereby expressly waive demand, presentment for payment, notice of nonpayment, protest, notice of protest, notice of intention to accelerate maturity, notice of acceleration of maturity, and all other notice, filing of suit and diligence in collecting this note or enforcing or handling any of the security therefor, and do hereby agree to any substitution, exchange or release, in whole or in part, of any security here-for or the release of any other liable party, and do hereby consent to any and all renewals or extensions from time to time, of this note, or any part hereof, either before or after maturity, all without any notice thereof to any of them and without affecting or releasing the liability of any of them. Each other liable party does further agree that il will not be necessary for the holder hereof, in order to enforce payment of this note by such other liable party, to first institute suit or exhaust its remedies against Maker or any other liable party or to enforce its dghts against any secudty therefor. SIGNED AND AGREED TO on the day of ,200__. TRIANGLE WASTE PROPERTIES LP, a Texas limited partnership By: Triangle Waste Solutions, LLC, Its General Partner, a Texas limited liability company By:. Joseph B. Swlnbank, President ACKNOWLEGEMENT THE STATE OF TEXAS COUNTY OF JEFFERSON BEFORE ME, THE UNDERSIGNED Nota~j Public, on this day personally appeared Joseph W. Swinbank, President~ of_ T_da__n~e_Wa_st_e Solutions, LLC_, _Ge._ne_ral_~ Partner of Triangle Waste Properties LP, known to me to be the person whose name is subscribed' to the foregoing instrument, and acknowledged to me that he/she executed the same as the act and deed of the Triangle Waste Solutions, LLC, for the purposes and consideration therein expressed, and the Capacities therein stated. GIVEN UNDER MY HAND AND SEAL OF OFFICE, this the day of ,200__. NOTARY PUBLIC, STATE OF TEXAS MAKERS' ADDRESS FOR RECEIPT OF NOTICE: TRIANGLE WASTE ~_R O_P_E R_TIE S_LP_ ................... CIo Triangle Waste Solutions, LLC 104t Conrad Sauer Road Houston, TX 77043 ATTN: Joe Swlnbank EXHIBIT "C" COMMERCIAL SECURITY AGREEMENT Dated ,200_ Surety Secured Party Joe Swinbank Port Arthur Ecor/omic Development Donald Poarcl~ Corporation ("PAEDC') l' [.I)e~a: Joe Swia~ar~ P.O. Box 19129 444 4~ Street Houston, Texas 77224 Port Arthur, Texas 77640 FOR VALUE RECEIVED, the receipt and sufficiency of which is hereby acknowledged, Surety grants to Secured Party thc security interest (and the pledges and assignments as applicable) hereinafter set forth and agrees with Secured Party as follows: A. OBLIGATIONS SECURED. The first priority lien and pledges and assignments as applicable granted hereby are to secure pun~ual payment and )erformance by the principal, TRIANGLE WASTE PROPERTIES, LP i".T~IANGLE"), 0f. the fo!!0wi~g 0b[igati0ns~ (i) UP ~o S392~000. ~f th~ c~rt~in · ~l~L~sox~vrm~s, ~.L.c conditional promissory note,e~utedby. Tr angle a~/. p~ob!~ to..~l~. 0rdor of: Seeur~xt Party,, of 'even date herewith (and any and all extensions, renewals, '{inserted: nodifications and rearrangements thereof), but to be effective only if Triangle maet~a: O~ of,,~t~ defaults under the Contract (defined below) and receives a written notice from ':' Secured Party advising of such default and that such note has become effective~ ,(ii) x~: ~xgut,a or al[, obligations_of.Triangle to S~ur. ed Party u~der that certain Economic Ince~i!~?~ renewals, modifications and rearrangements thereof, ,(all of which are herein separately...'.i of s3m.mo (e~ and collectively referred to as the '*Obligations"). Surety acknowledges that the Tria~gle and gayable to the order of security interest (and pledges and assignments as applicable) hereby granted shall . secure all future advances as well as any and all other indebtedness, liabilities and "... I : ' ' ' obhgatmns of Trtangle, ansang under the Contract to Secured Party whether now m '; '! B. USE OF COLLATERAL. N/A. ~et~l~ cerlain C. DESCRIPTION OF COLLATERAL. Surety hereby grants to Secured whats~ ~ o~,*~t~er Pasty a first priority lien in (and hereby pledges and assigns as applicable) and agrees '. s,~ir~xto s~,nd that Secured Party shall continue to have a security interest in (and a pledge and ' assignment of as applicable), the following property, to wit: : d,~ ~a ~0~,, X A first priority lien on Texas State Bank Certificate of Deposit Number , in the name of Joe Swinbank and Donald Poaceh, The term "Collateral" as used in this Agreement shall mean and include, and the security interest (and pledge and assignment as applicable) shall cover, all of the foregoing property, as well as any accessions, additions and attachments thereto and the proceeds and products thereof, including without limitation, all cash, general intangibles, accounts, inventory, equipment, fixturns, farm products, notes, drafts, acceptances, securities, instruments, chattel paper, insurance proceeds payable because of loss or damage, or other property, benefits or rights arising therefrom, and in and to all returned or repossessed goods arising from or relating to any of the property described herein or other proceeds of any sale or other disposition of such property. As additional security for the punctual payment and performance of the Obligations, and as part of the Collateral, Surety hereby grants to Secured Party a security interest in, and a pledge and assignment of. any and all money, property, deposit accounts, accounts, securities, documents, chattel paper, claims, demands, instruments, items or deposits of the Surety, and each of them, or to which any of them is a party, now held or hereafter coming within Secured Party's custody or control, including without limitation, all certificates of deposit and other depository accounts, whether such have matured or the exemise of Secured Party's rights results in loss of interest or principal or other penalty on such deposits, but excluding deposits subject to tax penalties if assigned. Without prior notice to or demand upon the Surety, Secured Party may exercise its rights granted above at any time when a default has occurred and Triangle ~as been adYisefi 9f same i9. wri~ting by Secured ,under the Contract Party and that the note referred to above has become effective. Secured Party's rights and remedies under this paragraph shall be in addition to and cumulative of any other rights or remedies at law and equity, including, without limitation, any rights of set-off to which Secured Party may be entitled. D. REPRESENTATIONS, WARRANTIES AND COVENANTS OF SURETY. Surety represents and warrants as follows: 1. Ownership; No Encumbrances: Except for the security interest (and pledges and assignments as applicable) granted hereby, the Surety is, and as to any property acquired after the date hereof which is included within the Collateral, Surety will be, the owner of all such Collateral free and clear from all charges, liens, security interests, adverse claims and encumbrances of any and every nature whatsoever. 2. No Financing Statements: There is no financing statement or similar filing now en ~e in any public office covering any part of the Collateral, and Surety will not execute and there will not be on file in any public office any financing statement or similar filing except the financing statements fried or to be flied in favor of Secured Party. 3. Accuracy of Information: All information furnished to Secured Party concerning Surety, the Collateral and the Obligations, or otherwise for the purpose of obtaining or maintaining credit, is or will be at the time the same is furnished, accurate and complete in all material respects. 4. Authority: Surety has full right and authority to execute and perform this Agreement and to create the security interest (and pledges and assignment as applicable) created by this Agreement. The making and performance by Surety of this Agreement will not violate any articles of incorporation, bylaws or similar document respecting Surety, any provision of law, any order of court or governmental agency, or any indenture or other agreement to which Surety is a party, or by which Surety or any of Surety's property is bound, or be in conflict with, result in a breach of or constitute (with due notice and/or lapse of time) a default under any such indenture or other agreement, or result in the creation or imposition of any charge, lien, security interest, claim or encumbrance of any and every nature whatsoever upon the Collateral, except as contemplated by this Agreement. 5. Addresses: The address of Surety designated at the begirming of this Agreement is Surety's place of business if Surety has only one place of business; Surety's chief executive office if Surety has more than one place of business; or Surety's residence if Surety has no place of business. Surety agrees not to change such address without advance written notice to Secured Party. E. GENERAL COVENANTS. Surety covenants and agrees as follows: 1. Assessments: Surety shall promptly pay when due all taxes, assessments, license fees, registration fees, and governmental charges levied or assessed against Surety or with respect to the Collateral or any part thereof. 2. No Encumbrances: Surety agrees not to suffer or permit any charge, lien, security interest, adverse claim or encumbrance of any and every nature whatsoever against the Collateral or any part thereof. 3. No Removal: Except as otherwise provided in this Agreement, Surety shall not remove the Collateral from the county or counties designated at the beginning of this Agreement without Secured Party's prior written consent. 4. No Transfer: Except as otherwise provided in this Agreement with respect to inventory, Surety shall not, without the prior written consent of Secured Party, sell, assign, transfer, lease, charter, encumber, hypothecate or dispose of the Collateral, or any part thereof, or interest therein, or offer to do any of the foregoing. 5. Notices and Reports: Surety shall promptly notify Secured Party in writing of any change in the name, identity or structure of Surety, any charge, lien, security interest, claim or encumbrance asserted against the Collateral, any litigation against Surety or the Collateral, any theft, loss, injury or similar incident involving the Collateral, and any other material mauer adversely affecting Surety or the Collateral. Surety shall furnish such other reports, information and data regarding Surety's financial condition and operations, the Collateral and such other matters as Secured Party may request from time to time. 6. Additional Filings: Surety agrees to execute and deliver such financing statement or statements, or amendments thereof or supplements thereto, or other decumems as Secured Party may from time to time require in order to comply with the Texas Uniform Commercial Code (or other applicable stale law of the jurisdiction where any of the Collateral is located) and to preserve and protect the Secured Party's rights to the Collateral. 7. Protection of Collateral: Secured Party, at its option, whether before or after default, but without any obligation whatsoever to do so, may (a) discharge taxes, claims, charges, liens, security interests, assessments or other encumbrances of any and every nature whatsoever at any time levied, placed upon or asserted against the Collateral, (b) place and pay for insurance on the Collateral, including insurance that only protects Secured Party's interest, (c) pay for the repair, improvement, testing, maintenance and preservation of the Collateral, (d) pay any filing, recording, registration, licensing or certification fees or other fees and charges related to the Collateral, or (e) take any other action to preserve and protect the Collateral and Secured Party's rights and remedies under this Agreement a~ Secured Party may deem necessal3, or appropriate. Surety agrees that Secured Party shall have no duty or obligation whatsoever to take any of the foregoing action. Surety agrees to promptly reimburse Secured Party upon demand for any payment made or any expense incurred by the Secured .Party pursuant to this authorization. These. payments and expenditures, together with interest thereon from date incurred until paid by Surety at the reaximum contract rate allowed under applicable laws, which Surety agrees to pay, shall constitute additional Obligations and shall be secured by and entitled to the benefits of this Agreement. or through any of its officers, agents, attorneys or accountants, to examine the 'oew,~a: 10. Additl~nalCoSateral: I Collateral whereverlocalede If~ecur~tPattyaho~ldatanytilneheof deliver all such additional and further acts, things, deeds, interests and assurances as Obligations ~o1~ im~ure, Party's rights and remedies, pm.~ to f~rnish sar. h additional F. ADDITIONAL PROVISIONS REGARDING CERTIFICATES OF DEPOSIT AND SIMILAR COLLATERAL. The following provisions shall apply to certificates of deposit and similar property included within the Collateral: 1. Collection of Deposits: Surety agrees that Secured Party may, at any time (whether before or after default) and in its sole discretion, surrender for payment and obtain payment of any portion of the Collateral, whether such have matured or the exercise of Secured Party's rights results in loss of interest or principal or other penalty on such deposits, and, in connection therewith, cause payment to be made directly to Secured Party. 2. Notice to Third Party Issuer: With regard to any certificates of deposit or similar Collateral for which Secured Party is not the issuer, Surety agrees to notify the issuer or obligor of the interests hereby granted to Secured Party and to obtain from such issuer or obligor acknowledgement of the interests in favor of Secured Party, the issuer's or obligur's agreement to waive in favor of Secured Party any and all rimhts of set-off or similar rights or remedies to which such issuer or obliaur may be entitled, and, in connection therewith, to execute and cause the issuer or obligor to execute, any and all acknowledgments, waivers and other agreements in such form and upon such terms as Secured Party may requesL 3. Proceeds: Any and all replacement or renewal certificates, instruments, or other benefits or proceeds related to the Collateral that are received by Surety shall be held by Surety in trust for Secured Party and immediately delivered to Secured Party to be held as part of the Collateral. 4. No Duty: Secured Party shall never be liable for its failure to give notice to Surety of default in the payment of or upon the Collateral. Secured Party shall have no duty to fix or preserve rights against prior parties to the Collateral and shall never be liable for its failure to use diligence to collect any amount payable in respect to the Collateral, but shall be liable only to account to Surety for what it may actually collect or receive thereon. Without limiting the foregoing, it is specifically understood and agreed that Secured Party shall have no responsibility for ascertaining any maturities or similar matters relating to any of the Collateral or for informing Surety with respect to any of such matters (irrespective of whether Secured Party actually has, or may be deemed, to have, knowledge thereof). G. EVENTS OF DEFAULT. Surety shall be in default hereunder upon the' happening of any of the following events ur conditions: (i) non-payment when due (whether by acceleration of maturity or otherwise) of any paymem of principal, interest or other mount due on any Obligation by Triangle after receiving written notice of same by Secured Party and that the note described above is effective; (ii) the occurrence of any event which under the terms of any evidence of indebtedness, indemure, loan agreement, security agreemem or, similar instrument permits the acceleration of maturity of any obligation of Surety (whether to Secured Party or to others); (iii) any representation or warranty made by Surety to Secured Party in connection with this Agreement, the Collateral or the Obligations, or in any statements or certificates, proves incorrect in any material respect as of the date of the making or the issuance thereof; (iv) default occurs in the observance or performance of. or if Surety fails to furnish adequate, evidence of I~rformance of any provision of this Agreement or of any note. assignment, transfer, other agreement, documenl or instrumem delivered by Surety to Secured Party in eennection with this Agreement, the Collateral or the Obligations; (v) death, dissolution, liquidation, U~rmination of existence, insolvency, business failure or winding-up of Surety or any maker, endorser, guarantor, surety or other party liable in any capacity for any of the Obligations; (vi) the commission of an act of bankruptcy by, or the application for appointment of a receiver or any other legal custodian for any part of the property of, assignment for the benefit of creditors by, or the commencement of any proceedings under any banknlptcy, arrangement, reorganization, insolvency or similar laws for the relief of suretys by or against, the Surety or any maker, endorser, guarantor, surety or other party primarily or secondarily liable for any of the Obligations: or (vii) ,the filing of any levy, attachment, execution, garnishment or other process against the Surety or any of [judgmem ofS~ured par~. impaired. the Collateral or any maker, endorser, guarantor, surety or other party liable in any or v~ue; or (viii} capacity for any of the Obligations. H. REMEDIES: Upon the occurrence of an evem of defanlt, or if Secured Party deems paymem of the Obligations to be insecure, Secured Party, at its option, shall be emitled to exercise any one or more of the following remedies (all of which are cumulative): Declare Obligations Due: Secured Party, at its option, may declare the Obligations or any part thereof iramediately due and payable, without demand, notice of intention to accelerate, notice of acceleration, notice of non-payment, presentmem, protest, notice of dishonor, or any other notice whatsoever, all of which are hereby waived by Surety and any maker, endorser, guarantor, surety or other party liable in any capacity for any of the Obligations. 2. Remedies: Secured Party shall have all of the rights and remedies provided for in this Agreement and in any other agreements executed by Surety, the rights and remedies o,f the Uniform Commercial Code of Texast and any ~fl. al! ~ ~t'3~ ~neleted~ o rights and remedies at iaw and in etiai~y, al~ of wliich shail be deemed c~ulative. Without limiting the foregoing, Surety agrees that Secured Party shall have the right to: (a) require Surety to assemble the Collateral and make it available to Secured Party at a place designated by Secured Party that is reasonably convenient to both parties, which Surety agrees to do; (b) peaceably take possession of the Collateral and remove same, with or without judicial process; (c) without removal, render equipment included within the Collateral unusable, and dispose of the Collateral on the Surety's premises; (d) sell, lease or otherwise dispose of the Collateral, at one or more locations, by public or private proceedings for cash or credit, without assumption of credit risk; and/or (e) whether before or after default, collect and receipt for, compound, compromise, and settle, and give releases, discharges and acquittances with respect to, any and all amounts owed by any person or entity with respect to the Collateral. Unless the Collateral is perishable or threatens to decline speedily in value or is of a type customarily sold on a recognized market, Secured Party will send Surety reasonable notice of the time and place of any public sale or of the time after which any private sale or other disposition will be made. Any requirement of reasonable notice to Surety shall be met if such notice is mailed, postage prepaid, to Surety at the address of Surety designated at the beginning of this Agreement, at least five (5) days before the day of any public sale or at least five (5) days before the time after which any private sale or other disposition will be made. 3. Expenses: Surety shall be liable for and agrees to pay the reasonable expenses incurred by Secured Party in enforcing its rights and remedies, in retaking, holding, testing, repairing, improving, selling, leasing or disposing of the Collateral, or like expenses, including, without limitation, attorneys' fees and legal expenses incurred by Secured Party. These expenses, together with interest thereon from date incurred until paid by Surety at the maximum contract rate allowed under applicable laws, which Surety agrees to pay, shall constitute additional Obligations and shall be secured by and entitled to the benefits of this Agreemem. 4. Proceeds, Surplus, Deficiencies: Proceeds received by Secured Party from disposition of the Collateral shall be applied toward Secured Party's expenses and other Obligations in such order or manner as Secured Party may elect. Surety shall be entitled to any surplus if one results after lawful application of the proceeds. Surety shall remain liable for any deficiency. 5. Remedies Cumulative: The rights and remedies of Secured Party are cumulative and the exercise of any one or more of the rights or remedies shall not be deemed an election of rights or remedies or a waiver of any other right or remedy. Secured Party may remedy any default and may waive any default without waiving the default remedied or without waiving any other prior or subsequem default. I. OTHER AGREEMENTS. 1. Savings Clause: Notwithstanding any provision m the contrary herein, or in any of the documems evidencing the Obligations or otherwise relating thereto, no such provision shall require the paymem or permit the collection of imerest in excess of the maximum permitted by applicable usury laws. If any such excessive interest is so provided for, then in such event (i) the provisions of this paragraph shall govern and control; (ii) neither the Surety nor his heirs, legal representatives, successors or assigns or any other party liable for the payment thereof, shall be obligated to pay the amoum of such interest m the extent that is in excess of the maximum amount permitted by law; (iii) any such excess interest that may have been collected shall be, at the option of the holder of the instrument egidencing the Obligations, either applied as a credit against the then unpaid principal amount thereof or refunded to the maker thereof; and (iv) the effective rate of interest shall be automatically reduced to the maximum lawful rate under applicable usury laws as now or hereafter construed by the courts having jurisdiction. 2. Joint and Several Responsibility: If this Security Agreemem is executed by more than one Surety, the obligations of all such Suretys shall be joint and several. 3. Waivers: Surety and any maker, endorser ~su[ety 0[ 9ther party liable in any capacity respecting the Obligations hereby waive demand, notice of intention to accelerate, notice of acceleration, notice of non-payment, presentment, protest, notice of dishonor and any other similar notice whatsoever. 4, Severability: Any provision hereof found m be invalid by courts having jurisdiction shall be invalid only with respect to such provision (and then only to the extent necessary to avoid such invalidity). The offending provision shall be modified to the maximum extem possible to confer upon Secured Party the benefits intended thereby. Such provision as modified and the remaining provisions hereof shall be construed and enforced to the same effect as if such offending provision (or portion thereof) bad not been contained herein, to the maximum extent possible. 5. Use of Copies: Any carbon, photographic or other reproduction of any financing statemem signed by Surety is snfficient as a financing statemem for all purposes, including without limitation, tiling in any state as may be permitted by the provisions of the Uniform Commercial Code of such state. 6. Relationship to Other Agreements: This Security Agreement and the security interests (and pledges and assignments as applicable) herein granted are in addition to (and not in substitution, novation or discharge of) any and all prior or contemporaneous security agreements, security interests, pledges, assignments, liens, rightz, titles ur other interests in favor of Secured Party or assigned to Secured Party by others in connection with the Obligations. All lights and remedies of Secured Party in all such agreements are cumulative, but in the event of actual conflict in terms and conditions, the terms and conditions of the latest security agreement shall govern and control. 7. Notices: Any notice or demand given by Secured Party to Surety in connection with this Agreement, the Collateral or the Obligations, shall be deemed given and effective upon deposit in the United States mail, postage prepaid, addressed to Surety at the address of Surety designated at the beginning of this Agreement. Actual notice to Surety shall always be effective no matter how given or received. 8. Headings and Gender: Paragraph headings in this Agreement are for convenience only and shall be given no meaning or significance in interpreting this Agreement. All words used herein shall be construed to be of such gender or number as the circumstances require. 9. Amendments: Neither this Agreement nor any of its provisions may be changed, amended, modified, waived or discharged orally, but only by an instramem in writing signed by the party against whom enforcement of the change, amendment, modification, waiver or discharge is sought. 10. Continuing Agreement: The security interest (and pledges and assignments as applicable) hereby granted and all of the terms and provisions in this Agreement shall be deemed a continuing agreement and shall continue in full force and effect until terminated in writing. Any such revocation or termination shall only be effective if explicitly confirmed in a signed writing issued by Secured Party to such effect and shall in no way impair or affect any transactions entered into or rights created or Obligations incurred or arising prior to such revocation or termination, as to which this Agreement shall be fully operative until same are repaid and discharged in f~ll. Unless otherwise required by applicable law Secured Party shall be under no obligation to issue a termination statement or similar documents unless Surety requests same in writing and, provided further, that all Obligations have been repaid and discharged in full and there are no commitments to make advances, incur any Obligations or otherwise give value. 11. Binding Effect: The provisions of this Security Agreement shall be binding upon the heirs, personal represematives, successors and assigns of Surety and the rights, powers and remedies of Secured Party hereunder shall inure to the benefit of the successors and assigns of Secured Party. 12. Governing Law: This Security Agreement shall be governed by the law of the State of Texas and applicable federal law. EXECUTED this __ day of ,200__. Joe Swinbank Donald Poarch SUBSCRIBED AND SWORN TO BEFORE ME by the said Ioe Swinbank, on the __ day of _ ,2006, to certify which witness my hand and seal of office. Notary Public, State of Texas SUBSCRIBED AND SWORN TO BEFORE ME by the said Donald Poarch, on the __ day of ,2006, to certify which witness my hand and seal of office. Notary Public, State of Texas EXHIBIT "D" ACI~NOWLEDG EMENT Texas State Bank hereby acknowledges and recognizes that The City of Port Arthur Section 4A Economic Development Corporation ("PAEDC") hold a ltrst priority lien against Certificate of Deposit Number , in the name of,Joe_./ Swinbank and Donald Poarch, to secure Triangle Waste Propertles~Ll~_ ~.'T_Han_gl_e"~ performance of the Econom/c Incentive Contract and Loan Agreement between Trlap~l¢_/ and pAl!Dc. TEXAS STATE BANK By Its Date SUBSCRIBED AND SWORN TO BEF©ILE ME on Ge __ day of ,2006, to certify which witness my hand and seal of office. Nom.ty Public, State of Texa~ EXHIBIT "E'I" UCC FINANCING STATEMENT ~City of port Art~xlr Section 4A Economic 4173 39th Street L_ - ~ ~'~ 224 USA ~ of Po~ A~hur Section 4A Economic Development Co~ora~on ~ -- 4173 39th S~reet Po~A~hur ~ 77~42 USA Texal S~ate B~nk Certificate of Depo~H No. I n[ema[ioozl Ass ochatlon of Commerdal .N:im[~lst~at ors ( IAC/q FILING OFFICE COPY ~ UCC FINANCING STATEMENT (FORM UCCt~ (REV. 05/22/02) EXHIBIT "E2" II ICC FINANCING STATEMENT :OLLOW INSTRUCTIONS ~rord ~ ba~k~ CAREFULLY · N*~J~E & PHONE OF CONTACT AT FILER [eP6on a-II r~city of Port Arthur Section 4A Economic Development Corporation 4173 39th Street Port Arthur, Texas 77642 10129 Houston TX [77224 ] USA I City of Port Arthur Section 4A Economic Development Corporation -- 4173 39th Street Port Arthur TX 177642 I USA ,. Irrtema~oaal Assoc~fio~ o! Commer~al Admi~iEVztors (tACA) FILING OFFICE COPY -- UCC FINANCING STATEMENT (FORM U¢Ct~ (REV, o5/22,"02} EXHIBIT "F" CERTIFICATION REGARDING LOBBYING For Contracts, Grants, Loans, and Cooperative Agreements The undersigned cedifies, to the best of his knowledge and belief, that: 1. No funds have been paid or will be paid, by or on behalf of the undersigned, to any person for influencing or attempting to influence an officer or employee of any agency, a member of the City or of the PAEDC in connection with the awarding of any contract, the making of any grant, the making of any loan, the entering into of any cooperative agreement, or modification of any contract, grant, loan, or cooperative agreement. 2 The undersigned shall require that the language of this certification be inctuded in the award documents for all sub-awards at all tiers (including subcontracts, sub-grants, and contracts under grants, loans, and cooperative agreements), and that all Subs shall certify and disclose accordingly. This certification is material representation of fact which reliance was placed when this transaction was made or entered into. Submission of this certification is a prerequisite for making or entering into this transaction. Signed: TRIANGLE WASTE PROPERTIES, LP., A Texas limited partnership By: Triangle Waste Solutions, L.L.C., a Texas limited liability company By:. Joseph B. Swinbank, President EXHIBIT "G" SPECIAL WARRANTY DEED STATE OF TEXAS § § KNOW ALL MEN BY THESE PRESENTS: COUNTY OF JEFFERSON § That the City of Port Arthur Section 4A Economic Development Corooratinn, a Texas not-for-profit corporation, hereinafter called "Grantor," whether one or more, in consideration of jobs as described in that certain Economic Incentive Contract and Loan Agreement, approved by City of Port Arthur Resolution No. ~ and other good and valuable consideration, to Grantor in hand paid by Triangle Waste Properties LP a Texas limited partnership, hereinafter called "Grantee," whether one or more, the receipt of which is hereby acknowledged, has GRANTED, SOLD and CONVEYED, and by these presents does GRANT, SELL and CONVEY unto Grantee, all that certain property situated in the County of Jefferson, State of Texas, described as follows, to-wit: Lot four (4) in Block one (I) of the Port Arthur Economic Development Corporation Business Park, in the city of Port Arthur, Jefferson County, Texas, according to the replat thereof recorded in Vol. Page Map Records, Jefferson County, Texas (hereinafter sometimes called the "Property"). This conveyance is made subject to the following: (1) easements and rights-of-way appearing of record in the office of the County Clerk of Jefferson County, Texas; (2) the right of Grantor and its designees to use and maintain storm water stub-outs, which extend a few feet from the South Business Park Drive right-of-way, mad serve to comaect the Property drainage system to the drainage system of the Port Arthur Economic Development Corporation Business Park; (3) all covenants, restrictions, and all conditions and exceptions, reservations and conveyances of minerals and/or royalties, oil and gas and/or mineral leases, affecting the above described property, of record in the Office of the County Clerk of Jefferson County, Texas, to the extent they are still in effect and relate to the above described property; (4) taxes on the above described property for 2006 and subsequent years not yet due and payable; (5) all zoning laws, regulations and ordinances of municipal and other governmental authorities, if any, but only to the extent that they are still in effect, relating to the above described property; and (6) the following additional covenants and restrictions which mn with the land: a. Screen property lines with 6-foot fencing with landscaping on the outside to provide extra protection; b. Screen the transfer station inside the plant with internal fencing; c. No scrap metal operation; d. Design, build mid operate so that scrap is not visible to any member of the public standing at ground level on a public way; e. Enclose all operations within buildings; and f. Store all equipment, tracks, roll off containers, etc., either behind the buildings or inside oftbe plant, so as not to be visible from South Business Park Drive. Grantor has executed and delivered this Special Warranty Deed and has granted, bargained, sold, and conveyed the Property to Grantee, and Grantee has received and accepted this Special Warranty Deed and has purchased, received, and, accepted the Property, ON AN AS-IS, WHERE IS BASIS, WITH ALL FAULTS AND WITHOUT ANY REPRESENTATIONS OR WARRANTIES WHATSOEVER, EXPRESS OR IMPLIED, WRITTEN OR ORAL, 1T BEING THE INTENTION OF GRANTOR AND GRANTEE TO EXPRESSLY REVOKE, RELEASE, NEGATE, AND EXCLUDE ALL REPRESENTATIONS AND 'WARRANTIES, INCLUDING, BUT NOT LIMITED TO, ANY AND ALL EXPRESS OR IMPLIED REPRESENTATIONS OR WARRANTIES AS TO (i) THE CONDITION OF THE PROPERTY OR ANY ASPECT THEREOF, INCLUDING, WITHOUT LIMITATION, ANY AND ALL EXPRESS OR IMPLIED REPRESENTATIONS AND WARRANTIES RELATED TO SUITABILITY FOR HABITATION, MERCHANTABILITY, OR FITNESS FOR A PARTICULAR USE OR PURPOSE; (ii) THE NATURE OR QUALITY OF CONSTRUCTION, STRUCTURAL DESIGN OR ENGINEERING OF ANY IMPROVEMENTS WHICH ARE PART OF THE PROPERTY OR WHICH SERVE THE PROPERTY (the "IMPROVEMENTS"); (iii) THE QUALITY OF THE LABOR OR MATERIAL INCLUDED IN THE IMPROVEMENTS; (iv) THE SOIL CONDITIONS, DRAINAGE, TOPOGRAPHICAL FEATURES OR OTHER CONDITIONS WHICH AFFECT TI-FE PROPERTY; (v) THE AREA, SIZE, SHAPE, CONFIGURATION, LOCATION, CAPACITY, USE, DEVELOPMENT POTENTIAL, PURPOSE OR OTHER CHARACTERISTIC CONCERNING OR RELATING TO THE PROPERTY; (v) ANY FEATURES OR CONDITIONS AT OR WHICH AFFECT THE PROPERTY WITH RESPECT TO ANY PARTICULAR PURPOSE, USE, DEVELOPMENTAL POTENTIAL, CASH FLOW, OR OTHERWISE; (vi) ALL EXPRESS OR IMPLIED REPRESENTATIONS OR WARRANTIES CREATED BY ANY AFFIRMATION OF FACT OR PROMISE OR BY ANY DESCRIPTION OF THE PROPERTY; (vii) ANY ENVIRONMENTAL, GEOLOGICAL, METEOROLOGICAL, STRUCTURAL OR OTHER CONDITION OR HAZARD OR THE ABSENCE THEREOF HERETOFORE, NOW, OR HEREAFTER AFFECTING IN ANY MANNER ANY OF THE PROPERTY; AND (viii) ALL OTHER EXPRESS OR IMPLIED WARRANTIES AND REPRESENTATIONS BY GRANTOR WHATSOEVER, EXCEPT SOLELY THE SPECIAL WARRANTY OF TITLE EXPRESSLY SET FORTH IN THIS DEED CONVEYING THE PROPERTY TO GRANTEE. TO HAVE AND TO HOLD, the said Property, together wilh all rights, hereditaments and appurtenances thereto belonging, unto Grantee, its successors, heirs, and assigns forever. And Grantor does hereby bind itself, its successors, heirs, executors, administrators, and personal representatives to WARRANT AND FOREVER DEFEND the title to said Property unto Grantee, its successors, heirs, and assigns, against every person whomsoever lawfully claiming or to claim the same or any part thereof, by, through, or under Grantor, but not otherwise. When Grantor or Grantee or both of tbem are more than one (1) person, or when Grantor or Grantee or both of them are a corporation, partnership, trustee, administrator, executor, or personal representative, this Deed shall read as though pertinent verbs, nouns, and pronouns are changed correspondingly, and pronouns of the masculine gender where used herein shall be consmaed to include persons oftbe female sex. When this Deed is executed by or to or by and to a corporation or partnership, references to "heirs, executors, administrators, 433534 and personal representatives" shall be appropriately disregarded, and when this Deed is executed by or to or by and to a natural person or persons, references to "successors" shall be appropriately disregarded. Grantee has joined in this Deed to evidence Grantee's acceptance of this Deed. EXECU'IZD this the __. day of ,2006. GRANTOR: THE CITY OF PORT ARTHUR SECTION 4a ECONOMNIC DEVELOPMENT CORPORATION, a Texas corporation By: Eli Roberts, President By: Linda Spears, Secretary GRANTEE: TRIANGLE WASTE PROPERTIES LP a Texas limited partnership By: Triangle Waste Solutions. LLC, General Partner By: Joseph B. Swinbank, President STATE OF TEXAS § COUNTY OF JEFFERSON This instrument was acknowledged before me on the day of , 2006, by Eli Roberts, President of the City of Port Arthur Section 4A Economic Development Corporation, a Texas not-for-profit corporation, on behalf of such corporation. Notary Public, State of Texas STATE OF TEXAS § COUNTY OF JEFFERSON § This instrument was acknowledged before me on the day of ,21/06, by Linda Spears, Secretary of the City of Port Arthur Section 4A Economic Development Corporation, a Texas not-for-profit corporation, on behalf of such corporation. Notary Public, State of Texas 433534 STATE OF TEXAS § COUNTY OF JEFFERSON § This instrument was acknowledged before me on the __ day of ,2006, by Joseph B. Swinbank, President of Triangle Waste Solutions, LLC, General Partner of Triangle Properties LP, on behalf of such corporation. Notary Public, State of Texas GRANTEE'S MAILING ADDRESS: c/o Poarch/Swinbank Limited Partnership 1041 Conrad Sauer Road Houston, Texas 77043 433534 EXHIBIT "H" (New) Special Addendum To Economic Incentive Contract and Loan Agreement Between The City Of Port Arthur Section 4A Economic Development Corporation and Triangle Waste Solutions, L.L.C. Notwithstanding anything to the contrary set forth in the Economic Incentive Contract And Loan Agreement (the "Contract") between The City of Port Arthur Section 4A Economic Development Corporation (the "PAEDC') and Triangle Waste Solutions, L.L.P. (the'"Triangle") to which this Special Addendum is attached, the parties hereto agree that the following provisions shall supercede and control over any other provisions of the Contract. 1. The PAEDC has good and indefeasible fee simple title to the 10 acre parcel located in the Park to be conveyed to Triangle (the "Property") free and clear of all liens, restrictions and other maters and encumbrances except for the restrictions specifically referenced in the Contract and of record in Jefferson County. 2. Effective upon delivery of the Deed conveying title to the Property from the PAEDC to Triangle, the PAEDC agrees that it will have no (and waives any) claims or interests whatsoever (including, without limitation, any implied vendor's liens) in and to the Property except for a second deed of trust to be granted by Triangle in favor of PAEDC covering the Property as security for incentive grant payments from PAEDC to Triangle (the "Grant Payments"). 3. Upon the full performance by Triangle of its obligations under the Contract, the PAEDC agrees to release and relinquish all security interests, assignments and other rights and interests it may have in and to any collateral securing Triangle's obligations under the Contract, and upon written request will deliver a UCC-I Termination Statement and such other evidence of such reasonably requested by Triangle. In addition, if at any time Triangle pays to the PAEDC the sum of Three Hundred Ninety-Two Thousand Forty and No/100 Dollars ($392,040.00) plus any Grant Payments received by triangle less any "credits" (as such term is used and defined in the Contract) then earned, the PAEDC agrees that Triangle shall be released form any further obligations under the Contract, and the PAEDC agrees to release and relinquish all security interests, assignments and other fights and interests it may have in and to any collateral securing Triangle's obligations under the Contract and its second lien deed of trust and upon written request will deliver a UCC-1 Termination Settlement and release of such second lien deed of trust and such other evidence of such release as may be reasonably requested by Triangle. 4. Triangle will not forfeit any "credits" (as such term is used and defined in the Contract) by failing to issue a required report in a timely manner unless Triangle fails to so issue such report within five (5) days after it receives a written notice form the I PAEDC that it has failed to so issue such report. 5. PAEDC represents to Triangle that the Property has legal and unencumbered access to and from a street, which PAEDC will dedicate to the City for use as a public 'street. 6. Triangle intends to use the Property for the following purposes: a. Operation of a truck/vehicle repair, maintenance and storage facility; b. Operation of a repair and storage facility for portable buildings; c. Operation of a recycling center (pursuant to a TCEQ permit for a Type 5 facility) allowing recycling of construction rabble/debris only; d. Discharge of sewage waste from portable toilets into a City certified meter and ultimately into the City sanitary sewer system; e. Use of an administrative building or buildings; and f. Any uses which are reasonably incidental to any of the fbmgoing uses. The PAEDC approves of such uses and agrees that same comply with the covenants and restrictions set forth or referenced in the Contract. EXHIBIT "1" (New) DEED OF TRUST Date: ,2006 Grantors: Triangle Waste Properties LP Grantors' Mailing Address (including county): 1041 Conrad Sauer Road Houston, TX 77043 ATTN: Joe Swinbank Trustee: KATHLEEN A. MCGLYNN Trustee's Mailing Address (including county): Germer Gertz, L.L.P. P.O. Box Beaumont, Texas 77704 (Jefferson County) Beneficiary; PORT ARTHUR SECTION 4A ECONOMIC DEVELOPMENT CORPORATION Beneficiary's Mailing Address (including county): 4173 39th Street Port Arthur, Texas 77642 (Jefferson County) Note Date: Date Grantor breaches that certain Economic Incentive Contract and Loan Agreement dated 2006, Amount: The sum of Beneficiary's cash grant to Grantee minus credit earned, pursuant to that certain Economic Incentive Contract and Loan Agreement dated ,2006 (not to exceed $500,000). Maker: Triangle Waste Properties LP Payee: Same Final Matudty Date: Three years after Grantor breaches that certain Economic Incentive Contract and Loan Agreement dated ,2006, Property: Lot four (4) in Block one (1) of the Port .Arthur Economic Development Corporation Business Park, in the city of Port Arthur, Jefferson County, Texas, according to the replat thereof recorded in Vol. Page __ Map Records, Jefferson County, Texas (hereinafter sometimes called the "Property"). The Property covered by this Instrument includes the Land and the following items, whether now owned or hereafter acquired, all of which, including replacements and additions thereto, shall be deemed to be and remain part of the Property covered by this Instrument, and all rights, hereditaments and appurtenances pertaining thereto, all of which are referred to as the "Property": (a)Any and all buildings, improvements, and tenements now or hereafter attached to or placed, erected, constructed, or developed on the Land; (b) all fixtures, now or hereafter attached to Land or improvements, that are necessary or useful for the complete and comfortable use and occupancy of the Land and Improvements; (c) all water and water rights, timber, crops, and mineral interest pertaining to the Land; (d) all building materials and fixtures now or hereafter delivered to and intended to be installed in or on the Land or the Improvements; {e) all plans and specifications for the Improvements and for any future development of or construction on the Land; (f) all Grantor's rights (but not Grantor's obligations) under any contracts relating to the Land or the Improvements; (g) all deposits (including tenant security deposits), ,funds, instruments, note~ or chattel paper arising from or by virtue of any transactions related to the Land (h) all Grentor's rights (but not Grantor's obligations) under any documents, contract rights, accounts, commitments, construction contracts (and all payment and performance bonds, statutory or otherwise, issued by any surety in connection with any such construction contracts, and the proceeds of such bonds), architectural contracts and engineering contracts arising from or by virtue of any transactions related to the Land or the Improvements; (i) all permits, licenses, franchises, certificates, and other rights and privileges now owned or held or hereafter obtained in connection with the Land and the improvements; (j) all development rights, utility commitments, water and wastewater taps, capita~ improvement project contracts, utility construction agreements with any governmental authority, including municipal utility districts, or with any utility companies (and all refunds and reimbursements thereunder) relating to the Land or the Improvements; (k) all proceeds arising from or by virtue of the sale, lease or other disposition of the Land or the Improvements; (~) all proceeds (including premium refunds) of each policy of insurance relating to the Land and the Improvements; (m) all proceeds from the taking of any of the Land or the Improvements or any rights appurtenant thereto by right of eminent domain or by private or other purchase in lieu thereof, including change of grade of streets, curb cuts or other rights of access, for any public or quasi-public use under any law; (n) all right, title, and interest of Grantor in and to ali streets, roads, public places. easements, and rights-of-way, existing or proposed, public or private, adjacent to or used in connection with, belonging or pertaining to the Land; (o) all of the Leases, rents, royalties, bonuses, issues, profits, revenues, or other benefits of the Land or the Improvements, including without Limitation cash or securities deposited pursuant to leases to secure performance by the tenants of their obligations thereunder (subject to the Assignment of Rents made in Article V below); and (p) other interest of every kind and character that Grantor now has or at any time hereafter acquires in and to the Land and the Improvements, including rights of ingress and egress and ali reversionary rights or interests of Grantor with respect to such property and all of Grantor's rights (but not Grantor's obligations) under any covenants, conditions, and restrictions for the Land, as the same may be amended from time to time. including Grantor's rights, title, and interests thereunder as declarant or developer, if applicable. Senior (prior) Lien (including recording information): Deed of Trust, dated , 2006, and recorded at for the benefit ol~Texas State Bank, which Deed of Trust hs Deed of Trust up to the amount of $4000000.00 of shall be senior in priority to ,t indebtedness (the "Senior Deed of Trust"). Other Exceptions to Conveyance and Warranty: This conveyance is made expressly SUBJ'ECT TO any and all restrictions, covenants, conditions, easements, right-of-ways, and mineral and/or royalty reservations of record, if any, affecting this Property and the Senior Deed of Trust up to $4,000,000.00 of indebtedness. For value received and to secure payment of the note, Grantor conveys the property to Trustee in trust. Grantor warrants and agrees to defend the title to the property. If Grantor performs all the covenants and pays the,amount of indebtedness on the Note which relates to Beneficiaries cash grants to Grantor (not to exceed $500,000) plus all interest attributable to such indebtedness according to its terms, this deed of h'ust shall have no further effect, and Beneficiary shall release it at Grantor's expense. Grantor's Obligations Grantor agrees to: t. keep the property in good repair and condition; 2. pay all taxes and assessments on the property when due and by January 31 of the year immediately following, furnishing Beneficiary copies of tax receipts showing that all such mxas and assessments have been paid; 3. preserve the lien's priority as it is established in this deed of trust but subject to the Senior Deed of Trust up to $4,000,000 of indebtedness; 4. maintain, in a form reasonably acceptable to Beneficiary, an insurance policy that a. covers all improvements for their rial] insurable value as determined when the policy is issued and renewed, unless Beneficiary approves a smaller amount in writing; b. contains an 80% coinsurance clause; c. provides fire and extended coverage, including windstorm coverage; d. protects Beneficiary with a standard mortgage clause; e. provides flood insurance at any time the property is in a flood hazard asea; and f. contains such other coverage as Beneficiary may reasonably require; 5. comply at all times with the requirements of the 80% coinsurance clause; 6. deliver the insurance policy to Beneficiary and deliver renewals to Beneficiary at least ten days before expiration; 7. keep any buildings occupied as required by the insurance policy; and 8. provide the Beneficiary herein copies of all notices, financial statements, reports and other information provided to the senior lien holder; 9. punctually pay or cause to be paid the principal and interest to become due in respect of the senior debt according 'to the terms thereof,; 10. perform all of its obligations under the senior lender documents; 11. immediately report to Beneficiary in writing any default by Grantor under the senior lien; 12. immediately report to Beneficiary in writing any tax, judgment, materialmen's or mechanic's lien on the Property; value of the Property is approaching the total indebtedness represented by this Deed of Trust and the Senior Deed of Trust, upon notice thereof to Grantor, provide the Beneficiary with such additional collateral as may reasonably secure the Beneficiary's position, subject to the rights and restrictions imposed by the senior lien holder; and 14. arrange for senior lien holder to provide notice of default to Beneficiary. Grantor shall not, without the prior written consent of Beneficiary, 1. materially alter any of the terms and conditions of the senior debt or increase the maximum indebtedness $4,000,000.00 available to Grantor under the senior lender documents; or 2. further encumber the Property except for the Senior Deed of Trust. 1. Beneficiary may appoint in writing a substitute or successor trustee, succeeding to all rights and responsibilities of Trustee; 2. If the proceeds of the note are used to pay any debt secured by senior (prior) liens, Beneficiary is subrogated to all of the rights and liens of the holders of any debt so paid; 3. Subject to the provisions of the Covenants and Restrictions recorded in the Real Property Records of Jefferson County, Texas, and the Senior Deed of Trust which shall control and supercede anything herein contained to the contrary, Beneficiary shai.i apply any proceeds received under the insurance policy to repair or replace damaged or destroyed improvements covered by the policy, unless Grantor is in default of Note or Deed of Trust in which case insurance proceeds may be applied to reduce Grunter's obligation under Note or Deed of Trust; 4. If Grantor fails to perform any of Grunter's obligations, Beneficiary may perform those obligations and be reimbursed by Grantor on demand at the place where the note is payable for any sums so paid, including attorney's fees, plus interest on those sums from the dates of payments at the rate stated in the note for matured, unpaid amounts. The sum to be ralmbumed shall be secured by this deed of trust. 5. If Grantor defaults on the note or fails to perform any of Grunter's obligations or if default occurs on the senior lien note or,Senior Deed of Trust, and the defau t Iqi~.~i~' ~i~s~J~~ ............... continues after Beneficlary gives Grantor notice of the default and the time within which it must be cured, as may be required by law or by written agreement, then Beneficiary may: a~ Declare the unpaid principal balance and earned interest on the note immediately due; and b. Request Trustee to reconvey property to Beneficiary following a non-judicial foreclosure as required by law by a proper recorded warranty deed. Trustee's Duties If requested by Beneficiary to reconvey this property following a non-judicial foreclosure as required by law, Trustee shall: 1. Either personally or by agent give notice to Grantor at least 30 days before reeonveyance. Beneficiary will pay Trustee's expenses and fees. General Provisions 1. If any of the property is reconveyed under this deed of trust following a non- .~udieial foreclosure as required by law, Grantor shall immediately surrender possession to the Beneficiary. If Grantor fails to do so, Grantor shall become a tenant at sufferance oftbe Beneficiary, subject to an action for forcible detainer, 2. Recitals in any Trustee's deed conveying the property will be presumed to be true. 3. Proceeding under this deed of trust, filing suit or pursuing any other remedy will not constitute an election of remedies. ..' 4. This lien shall remain superior to liens lamr created even if the time of payment of all or part of the note is extended or part of the property is released. 5. If any portion of the note cannot be lawfully secured by this deed of trust, payments shall be applied first to discharge that p0rtion, 6. Grantor assigns to Beneficiary all sums payable to or received by Grantor from condemnation of all or part of the property, from private sale in lieu of condemnation, and from damages caused by public works or construction on or near the property. Atler deducting any expenses incurred, including attorney's fees, Beneficiary may release any remaining sums to Grantor or apply such sums to reduce the note Beneficiary shall not be liable for failure to collect or to exercise diligence in collecting any such sums. 7. Grantor assigns to Beneficiary absolutely, not only as collateral, all present and future rent and other income and receipts from the property. Leases are not assigned. Grantor warrants the validity and enfumeability of the assignment. Grantor may as Beneficiary's licensee collect rent and other income and receipts as long as Grantor is not in default under the note or this deed of trust. Grantor will apply all rent and other income and receipts to payment of the note and performance of this deed of trust, but if the rant and other income and receipts exceed the amount due under the note and deed of trust, Grantor may retain the excess. If Grantor defaults in payment of the note of performance of this deed of trust, Beneficiary may terminate Granter's license to collect and then as Grantor's agent may rent the property if it is vacant and collect all rent and other income and receipts. Beneficiary neither has not assumes any obligations as lessor or landlord with respect to any occupant of the property. Beneficiary may exemise Beneficiary's rights and remedies under this paragraph withom taking possession of the property. Beneficiary shall apply all rent and other income and receipts collected under this paragraph first to expenses incurred in exercising Beneficiary's rights and remedies and then to Grantor's obligations under the note and this deed of trust in the order determined by Beneficiary. Beneficiary is not required to act under this paragraph, and acting under this paragraph does not .waive any of Beneficiary's other rights or remedies. If Grantor becomes a voluntary or involuntary bankrupt, Benefi¢iary's filing a proof o~' claim in bankruptcy will be tantamount to the appointment ora receiver under Texas law. 8. Intarast on the debt secured by this deed of trust shall not exceed the maximum amount of nonusurious interest that may be contracted for, taken, reserved, charged, or received under law; any interest in excess of that maximum amount shall be credited on the principal of the debt or, if that has been paid, refunded. On any acceleration or required or permitted prepayment, any such excess shall be canceled automatically as of the acceleration or prepayment or, if already paid, credited on the principal of the debt or, if the principal of the debt has been paid, refunded. This provision overrides other provisions in this and all other instruments concerning the debt. 9. When the context requires, singular nouns and pronouns include the plural. I1. This deed of trust shall bind, insure to the benefit of, and be exercised by successors in interest of ail parties. 12. If Grantor and Maker are not the same person, the term Grantor shall include Maker. 13. THIS DEED OF TRUST IS GILAN~I~D IN CONJUNCTION WITH THAT CERTAIN ECONOMIC INCENTIVE CONTRACT AND LOAN AGREEMENT DATED ,2006. 14. Notwithstanding any provision herein to the contrary, any and all covenants, warranties, grants, liens, assignments (including assignments of rents or leases), security interests, transfers and conveyances set forth herein, and all other terms and provisions hereof and all rights and benefits of Beneficiary hereunder are expressly subject tn, inferior and subordinate to (a) all covenants, warranties, grants, liens, assignments (including assignments of rents or leases), security interests, transfers and conveyances created under and pursuant to, and all terms and provisions of, that certain Deed of Trust, effective as of , 2006 covering the Property, executed by Beneficiary to , Trustee for the benefit of Texas State Bank and other loan documents executed in connection therewith (together with any and all extensions, renewals, modifications, substitutions and/or amendments thereof) securing that certain promissory note of even date therewith in the principal amount of $ executed by Grantor and payable to the order of Texas State Bank, and any extensions, renewals, modifications, substitutions and/or amendments thereof up to but not to exceed an indebtedness of $4,000,000.00 in favor of Texas State Bank. TRIANGLE WASTE PROPERTIES LP A Texas limited partnership By: Triangle Waste Solutions, LLC its General Partner, a Texas limited liability company By: Joseph B. Swinbank, President STATE OF § COUNTY OF § This instrument was acknowledged before me on this the __ day of ,2006, by Joseph Swinbank, President of Triangle Waste Solutions, LLC, General Partner of Tdangle Waste Propedies LP, a Texas limited partnership, on behalf of such entities. Nota~J Public, State of Texas AFTER RECORDING RETURN TO: Kathleen A. McGlynn Germer Gertz, L.L.P. P.O. Box 4915 Beaumont, Texas 77704