EXHIBIT 10.34

 

MULTIPLE INDEBTEDNESS MORTGAGE,    STATE OF PENNSYLVANIA ASSIGNMENT OF LEASES
AND RENTS,    COUNTY OF DELAWARE SECURITY AGREEMENT AND FIXTURE FILING   

 

BY: WINCUP HOLDINGS, INC.

 

IN FAVOR OF:    TENNENBAUM CAPITAL PARTNERS, LLC, IN ITS CAPACITY AS COLLATERAL
AGENT

BE IT KNOWN, that on this 1st day of December, 2005;

BEFORE ME, the undersigned Notary Public, and in the presence of the undersigned
competent witnesses;

PERSONALLY CAME AND APPEARED:

WINCUP HOLDINGS, INC. (TIN 86-0699193), a Delaware corporation appearing herein
through Michael T. Kennedy, its President pursuant to a resolution by its Board
of Directors a certified extract of which is attached hereto and made a part
hereof, with a mailing address of c/o Radnor Holdings Corporation, Radnor
Financial Center, 150 Radnor Chester Road, Building A, Suite 300, Radnor, PA
19087 (“Mortgagor”)

WHO DECLARED THAT:

WHEREAS, TENNENBAUM CAPITAL PARTNERS, LLC, having an address of 2951 28th
Street, Suite 1000, Santa Monica, California 90405, in its capacity as
collateral agent (together with its successors and assigns in such capacity,
“Mortgagee”) accepts this Mortgage;

WHEREAS, the Lenders (as defined in the Credit Agreement (as defined below))
have extended, at the request of Radnor Holdings Corporation (the “Company”),
$92,600,000 aggregate principal amount of Tranche A Loans (the “Tranche A
Loans”) and $2,400,000 aggregate principal amount of Tranche B Loans (the
“Tranche B Loans”)(the Tranche A Loans and the Tranche B Loans are collectively
referred herein as, the “Loans”); the total aggregate principal amount of the
Loans not exceeding ninety-five million dollars ($95,000,000) and which Loans
are evidenced by the Tranche A Notes executed by the Company (the “Tranche A
Notes”) and Tranche B Notes executed by the Company (the “Tranche B Notes”)
pursuant to that certain Credit Agreement, of even date herewith (the “Credit
Agreement”), between the Company, the Company’s subsidiaries that provide
guarantees under the Credit Agreement (the “Guarantors”), the Lenders and
Tennenbaum Capital Partners, LLC, as agent and collateral agent;

WHEREAS, the Company, the Guarantors, and Mortgagee, as collateral agent, have
entered into that certain Tranche A Security Agreement (the “Tranche A Security
Agreement”) dated as of the date hereof pursuant to which the Company and the
Guarantors have granted a security interest in, and undertaken obligations with
respect to, certain collateral and other property described therein;

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WHEREAS, Mortgagor is the owner of fee simple title to certain tract of land
located at 7501 East Trammel Drive, in the City of Shreveport, Caddo Parish,
State of Louisiana, as more particularly described in Schedule “A” attached
hereto and made a part hereof (the “Real Estate”);

WHEREAS, pursuant to the Credit Agreement, the Guarantors have unconditionally
guaranteed the repayment of the indebtedness evidenced and represented by the
Tranche A Notes, as well as the payment, performance, observance and discharge
by the Company of all obligations, covenants, conditions and agreements made by
the Company to, with, in favor of and for the benefit of Mortgagee or any of the
Tranche A Lenders (as defined in the Credit Agreement) under the Credit
Agreement and the Other Documents (as hereinafter defined);

WHEREAS, Mortgagee and the Tranche A Lenders, as a condition precedent to the
transactions contemplated by the Credit Agreement, have required that Mortgagor
execute and deliver this Mortgage in favor of Mortgagee; and

WHEREAS, Mortgagor is one of the Guarantors and Mortgagor will directly and
substantially benefit from the transactions contemplated by the Credit
Agreement.

GRANTING CLAUSES

NOW, THEREFORE, to secure to Mortgagee (i) the payment or performance and
discharge of all sums due under this Mortgage; (ii) the payment or performance
and discharge of all terms, conditions and covenants, including the Secured
Obligations, set forth in the Credit Agreement and the Other Documents, other
than the payment of principal, prepayment premium, if any, and interest on, the
Tranche B Loans and the performance of the Guarantors with respect thereto; and
(iii) the payment or performance and discharge of all other obligations or
indebtedness of Mortgagor, the Company or the other Guarantors to Mortgagee or
Tranche A Lenders of whatever kind or character and whenever borrowed or
incurred under the Credit Agreement or the Other Documents, including without
limitation, principal, prepayment premium, if any, and interest (as the same may
vary in accordance with the terms of the Credit Agreement) on the Tranche A
Loans (but excluding the payment of principal, prepayment premium, if any, and
interest on, the Tranche B Loans), fees, late charges and expenses, including
attorneys’ fees (subsections (i), (ii) and (iii) collectively, the
“Liabilities”), Mortgagor has warranted, mortgaged, granted, conveyed, assigned,
remised and released and by these presents DOES HEREBY WARRANT, MORTGAGE, GRANT,
CONVEY, ASSIGN, REMISE

AND RELEASE TO MORTGAGEE, ITS SUCCESSORS AND ASSIGNS FOREVER, AND HEREBY GRANTS
A CONTINUING SECURITY INTEREST TO MORTGAGEE IN all of Mortgagor’s right, title
and interest now owned or hereafter acquired in and to each of the following
(collectively, the “Property”):

(A) The Real Estate;

(B) Any and all buildings and improvements now or hereafter erected on, under or
over the Real Estate (the “Improvements”);

(C) Any and all fixtures, machinery, equipment and other articles of real,
personal or mixed property, belonging to Mortgagor, at any time now or hereafter
installed in, attached to or situated in or upon the Real Estate, or the
Improvements, or used or intended to be used in connection with the Real Estate,
or in the operation of the Improvements, plant, business or dwelling situate
thereon, whether or not such real, personal or mixed property is or shall be
affixed thereto, and all replacements, substitutions

 

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and proceeds of the foregoing (all of the foregoing herein called the “Service
Equipment”), including without limitation: (i) all appliances, furniture and
furnishings; all articles of interior decoration, floor, wall and window
coverings; all office, restaurant, bar, kitchen and laundry fixtures, utensils,
appliances and equipment; all supplies, tools and accessories; all storm and
screen windows, shutters, doors, decorations, awnings, shades, blinds, signs,
trees, shrubbery and other plantings; (ii) all building service fixtures,
machinery and equipment of any kind whatsoever; all lighting, heating,
ventilating, air conditioning, refrigerating, sprinkling, plumbing, security,
irrigating, cleaning, incinerating, waste disposal, communications, alarm, fire
prevention and extinguishing systems, fixtures, apparatus, machinery and
equipment; all elevators, escalators, lifts, cranes, hoists and platforms; all
pipes, conduits, pumps, boilers, tanks, motors, engines, furnaces and
compressors; all dynamos, transformers and generators; (iii) all building
materials, building machinery and building equipment delivered on site to the
Real Estate during the course of, or in connection with any construction or
repair or renovation of the Improvements; (iv) all parts, fittings, accessories,
accessions, substitutions and replacements therefor and thereof; and (v) all
files, books, ledgers, reports and records relating to any of the foregoing;

(D) Any and all leases, subleases, tenancies, licenses, occupancy agreements or
agreements to lease all or any portion of the Real Estate, Improvements, Service
Equipment or all or any other portion of the Property and all extensions,
renewals, amendments, modifications and replacements thereof, and any options,
rights of first refusal or guarantees relating thereto (collectively, the
“Leases”); all rents, income, receipts, revenues, security deposits, escrow
accounts, reserves, issues, profits, awards and payments of any kind payable
under the Leases or otherwise arising from the Real Estate, Improvements,
Service Equipment or all or any other portion of the Property including, without
limitation, minimum rents, additional rents, percentage rents, parking,
maintenance and deficiency rents (collectively, the “Rents”); all of the
following personal property to the extent assignable (collectively referred to
as the “Contracts”): all accounts, general intangibles and contract rights
(including any right to payment thereunder, whether or not earned by
performance) of any nature relating to the Real Estate, Improvements, Service
Equipment or all or any other portion of the Property or the use, occupancy,
maintenance, construction, repair or operation thereof; all management
agreements, franchise agreements, utility agreements and deposits, building
service contracts, maintenance contracts, construction contracts and architect’s
agreements; all maps, plans, surveys and specifications; all warranties and
guaranties; all permits, licenses and approvals; and all insurance policies,
books of account and other documents, of whatever kind or character, relating to
the use, construction upon, occupancy, leasing, sale or operation of the Real
Estate, Improvements, Service Equipment or all or any other portion of the
Property;

(E) Any and all estates, rights, tenements, hereditaments, privileges,
easements, reversions, remainders and appurtenances of any kind benefiting or
appurtenant to the Real Estate, Improvements or all or any other portion of the
Property; all means of access to and from the Real Estate, Improvements or all
or any other portion of the Property, whether public or private; all streets,
alleys, passages, ways, water courses, water and mineral rights relating to the
Real Estate, Improvements or all or any other portion of the Property; all
rights of Mortgagor as declarant or unit owner under any declaration of
condominium or association applicable to the Real Estate, Improvements or all or
any other portion of the Property including, without limitation, all development
rights and special declarant rights; and all other claims or demands of
Mortgagor, either at law or in equity, in possession or expectancy of, in, or to
the Real Estate, Improvements or all or any other portion of the Property (all
of the foregoing described in this subsection E herein called the
“Appurtenances”); and

(F) Any and all “proceeds” of any of the above-described Real Estate,
Improvements, Service Equipment, Leases, Rents, Contracts and Appurtenances,
which term “proceeds” shall have the meaning given to it in the Uniform
Commercial Code, as amended, (the “Code”) of the State in which

 

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the Real Estate is located (collectively, the “Proceeds”) and shall additionally
include whatever is received upon the use, lease, sale, exchange, transfer,
collection or other utilization or any disposition or conversion of any of the
Real Estate, Improvements, Service Equipment, Leases, Rents, Contracts and
Appurtenances, voluntary or involuntary, whether cash or non-cash, including,
subject to the terms of this Mortgage, proceeds of insurance and condemnation
awards, rental or lease payments, accounts, chattel paper, instruments,
documents, contract rights, general intangibles, equipment and inventory,
together with all property added to or substituted for any of the foregoing and
all interest, dividends, income, fruits, returns, accession, profits, corporate
distributions, including, without limitation, stock splits and stock dividends,
products and proceeds of any of the foregoing.

TO HAVE AND TO HOLD the above granted and conveyed Property unto and to the
proper use and benefit of Mortgagee, its successors and assigns, forever, hereby
expressly waiving and releasing any and all right, benefit, privilege, advantage
or exemption under and by virtue of any and all statutes and laws of the State
or other jurisdiction in which the Property is located providing for the
exemption of homesteads from sale on execution or otherwise.

PROVIDED ALWAYS, and these presents are upon the express condition, that if
(i) all the Liabilities are paid and performed in full, and (ii) each and every
representation, warranty, agreement and covenant of this Mortgage and the Credit
Agreement and the Other Documents is complied with and abided by, then this
Mortgage and the estate hereby created shall cease and be null and void and
Mortgagee shall release the lien of this Mortgage at the request and at the sole
cost and expense of Mortgagor. Mortgagor shall pay Mortgagee’s out-of-pocket
costs incurred in connection with such release.

All capitalized terms not otherwise defined herein shall have the meaning
ascribed to them in the Tranche A Security Agreement. To the extent of any
inconsistency between the terms hereof and the terms of the Tranche A Security
Agreement, the terms of the Tranche A Security Agreement shall control, except
that with respect to the remedies of a mortgagee under the law of the State of
Louisiana, the terms of this Mortgage shall govern; provided, however, that
Mortgagor and Mortgagee expressly agree that no conflict shall be deemed to
exist where one document imposes a stricter obligation than another, so long as
compliance with the stricter obligation does not make compliance with the less
strict obligation impossible. This Mortgage, the Tranche A Security Agreement,
the other Collateral Documents (as defined in the Credit Agreement) and any
other instrument given to evidence or further secure the payment and performance
of any of the Liabilities are sometimes hereinafter collectively referred to as
the “Other Documents”.

The present principal amount of the Liabilities secured hereby is $92,600,000;
the maximum principal amount, including present and future Liabilities, which
may be secured hereby at any one time is $190,000,000, plus interest, plus
prepayment premium, if any, plus any disbursements and taxes and insurance on
the Property and any other sums advanced in accordance with the terms hereof or
the Credit Agreement or any of the Other Documents to protect the security of
this Mortgage, the Credit Agreement or any of the Other Documents, plus interest
on such disbursements and advances at the rates set forth in the Credit
Agreement (the “Secured Amount”). Notwithstanding any other provision of this
Mortgage, the maximum amount of the Secured Amount secured hereby shall be
limited to $190,000,000.00. For purposes of this Mortgage, so long as the
aggregate principal balance of the Liabilities outstanding equals or exceeds the
Secured Amount, the amount of the Liabilities secured by this Mortgage shall at
all times equal only the Secured Amount. The Secured Amount shall be reduced
only by the last and final sums that are repaid with respect to the Liabilities
so as to make the aggregate principal balance of the Liabilities equal to an
amount less than the Secured Amount, and shall not be reduced by any intervening
repayments of the Liabilities. The parties acknowledge and agree that this
Mortgage does not secure the

 

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Tranche B Loans as evidenced by the Tranche B Notes or the obligations of the
Guarantors under the Credit Agreement with respect to the Tranche B Loans.

AND Mortgagor covenants and agrees with and represents to Mortgagee as follows:

1. FUTURE ADVANCES; PROTECTION OF PROPERTY; DURATION OF MORTGAGE.

1.1. Future Advances. This Mortgage has been executed by Mortgagor, pursuant to
Article 3298 of the Louisiana Civil Code for the purpose of securing the
obligations of Mortgagor, the Company or the other Guarantors that may be
existing and/or that may arise in the future as provided herein, with the
preference and priorities provided under applicable Louisiana laws. This
Mortgage shall secure any additional loans as well as any and all present or
future advances and re-advances under the Credit Agreement or any other
Liabilities made by Mortgagee or any Tranche A Lender to or for the benefit of
Mortgagor, the Company, the other Guarantors or the Property, including, without
limitation: (a) principal, interest, late charges, fees and other amounts due
under the Credit Agreement, the Other Documents or this Mortgage; (b) all
advances by Mortgagee to Mortgagor or any other person to pay costs of erection,
construction, alteration, repair, restoration, maintenance and completion of any
Improvements; (c) all advances made or costs incurred by Mortgagee for the
payment of real estate taxes, assessments or other governmental charges,
maintenance charges, insurance premiums, appraisal charges, environmental
inspection, audit, testing or compliance costs, and costs incurred by Mortgagee
for the enforcement and protection of the Property or the lien of this Mortgage;
and (d) all legal fees, costs and other expenses incurred by Mortgagee by reason
of any default or otherwise in connection with the Liabilities.

1.2. Protection of Property. Mortgagor agrees that if, at any time during the
term of this Mortgage or following a foreclosure hereof (whether before or after
the entry of a judgment of foreclosure), Mortgagor fails to perform or observe
any covenant or obligation under this Mortgage including, without limitation,
payment of any of the foregoing, Mortgagee may (but shall not be obligated to)
take such steps as are reasonably necessary to remedy any such nonperformance or
nonobservance and provide payment thereof. All amounts advanced by Mortgagee
shall be added to the amount secured by this Mortgage (and, if advanced after
the entry of a judgment of foreclosure, by such judgment of foreclosure), and
shall be due and payable on demand, together with interest at the rate borne by
the Tranche A Loans, such interest to be calculated from the date of such
advance to the date of repayment thereof.

1.3. Duration of Mortgage. This Mortgage will remain in effect until: (a) all of
the Secured Amount is fully paid and satisfied and there is no agreement or
commitment to advance any additional Liabilities and (b) Mortgagor cancels this
Mortgage by filing a written cancellation instrument signed by Mortgagee. When
all of the Secured Amount is fully paid and satisfied and there is no agreement
or commitment to advance any additional Liabilities Mortgagor may request
Mortgagee to sign such a written cancellation instrument by writing Mortgagee at
the above address or at such other address as Mortgagee may advise. Mortgagee
may delay providing Mortgagor with such a mortgage cancellation instrument for a
period following receipt of Mortgagor’s written request, or such longer time as
may be necessary for Mortgagee to verify that all conditions precedent for
mortgage cancellation have been satisfied.

2. REPRESENTATIONS, WARRANTIES AND COVENANTS.

2.1. Payment and Performance. Mortgagor shall (a) pay to Mortgagee all sums
required to be paid by Mortgagor under the Credit Agreement and the Other
Documents, in accordance with their

 

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stated terms and conditions; (b) perform and comply with all terms, conditions
and covenants set forth in the Credit Agreement and each of the Other Documents
by which Mortgagor is bound; and (c) perform and comply with all of Mortgagor’s
obligations and duties as landlord under any Leases.

2.2. Seisin and Warranty. Mortgagor hereby warrants that (a) Mortgagor is seized
of an indefeasible estate in fee simple in, and warrants the title to, the Real
Estate and the Improvements subject only to those exceptions more particularly
described in the title pro forma file number 445808COM issued by Commonwealth
Land Title Insurance Company and accepted by Mortgagee in connection with this
transaction (the “Permitted Exceptions”); (b) Mortgagor has the right, full
power and lawful authority to warrant, mortgage, grant, convey, assign, remise
and release the same to Mortgagee in the manner and form set forth herein; and
(c) this Mortgage is a valid and enforceable first lien on the Property.
Mortgagor hereby covenants that Mortgagor shall (a) preserve such title and the
validity and priority of the lien of this Mortgage and shall forever warrant and
defend the same, subject to the Permitted Exceptions, to Mortgagee against all
lawful claims whatsoever; and (b) execute, acknowledge and deliver all such
further documents or assurances as may at any time hereafter be required by
Mortgagee to protect fully the lien of this Mortgage.

2.3. Insurance.

(a) Mortgagor shall obtain and maintain at all times throughout the term of this
Mortgage the following insurance: (i) insurance in accordance with the terms of
the Credit Agreement; (ii) “All-Risk” fire and extended coverage hazard
insurance (non-reporting Commercial Property Policy with Special Cause of Loss
form) covering the Property in an aggregate amount not less than 100% of the
agreed upon full insurable replacement value of the tangible Property, including
coverage for loss of rents or business interruption and excluding roads,
foundations, parking areas, walkways and like improvements to the extent
customarily excluded from policies being issued by insurers of similarly
situated properties; (iii) during the course of any construction,
reconstruction, remodeling or repair of any Improvements, builders’ all-risk
extended coverage insurance (non-reporting Completed Value with Special Cause of
Loss form) in amounts based upon the completed replacement value of the
Improvements (excluding roads, foundations, parking areas, paths, walkways and
like improvements) and endorsed to provide that occupancy by any person shall
not void such coverage; and (iv) if the Improvements are required to be insured
pursuant to the National Flood Insurance Reform Act of 1994, and the regulations
promulgated thereunder, flood insurance in an amount at least equal to the
lesser of the agreed upon full insurable replacement value of the Improvements
or the maximum limit of coverage available.

(b) Each insurance policy required under this Section shall: (i) be written by
an insurance company authorized or licensed to do business in the state within
which the Real Estate is located having an Alfred M. Best Company, Inc. rating
of “A-” or higher and a financial size category of not less than IX; (ii) be for
terms of a least one year, with premium prepaid; (iii) be subject to the
reasonable approval of Mortgagee as to insurance companies, amounts, content,
forms of policies and expiration dates; and (iv) name Mortgagee, its successors
and assigns: (1) as an additional insured under all liability insurance
policies, and (2) as the first mortgagee, under a standard non-contributory
mortgagee clause, on all property insurance policies and all loss of rents or
loss of business income insurance policies.

(c) Mortgagor further agrees that each insurance policy: (i) shall provide at
least thirty (30) days’ prior written notice to Mortgagee prior to any policy
reduction or cancellation for any reason; (ii) shall contain an endorsement or
agreement by the insurer that any loss shall be payable to Mortgagee in
accordance with the terms of such policy notwithstanding any act or negligence
of

 

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Mortgagor which might otherwise result in forfeiture of such insurance;
(iii) shall waive all rights of setoff, counterclaim, deduction or subrogation
against Mortgagor; and (iv) shall exclude Mortgagee from the operation of any
coinsurance clause.

(d) On or before the date hereof, Mortgagor will deliver to Mortgagee
certificates of insurance reasonably satisfactory to Mortgagee evidencing the
existence of all insurance required to be maintained by Mortgagor hereunder
setting forth the respective coverages, limits of liability, carrier, policy
number and period of coverage and showing that such insurance will remain in
effect through the December 31 falling at least six months after the date
hereof, subject only to the payment of premiums as they become due, together
with an Officers Certificate stating that such insurance complies with the
provisions hereof. At least thirty (30) days prior to the expiration of any
insurance policy, Mortgagor shall furnish evidence satisfactory to Mortgagee
that such policy has been renewed or replaced or is no longer required. Nothing
in this Section 2.3 shall be deemed to limit in any respect the obligations of
the Mortgagor under any applicable provision of the Tranche A Security
Agreement.

2.4. Transfer of Title. Except as expressly provided in the Credit Agreement,
without the prior written consent of Mortgagee in each instance, Mortgagor shall
not cause or permit any transfer of the Property or any part thereof, whether
voluntarily, involuntarily (other than by reason of condemnation) or by
operation of law, nor shall Mortgagor enter into any agreement or transaction to
transfer, or accomplish in form or substance a transfer, of the Property. A
“transfer” of the Property includes: (a) the direct or indirect sale, transfer
or conveyance of the Property or any portion thereof or interest therein;
(b) the execution of an installment sale contract or similar instrument
affecting all or any portion of the Property; (c) if Mortgagor, or any general
partner or member of Mortgagor, is a corporation, partnership, limited liability
company or other business entity, the transfer (whether in one transaction or a
series of transactions) of any stock, partnership, limited liability company or
other ownership interests in such corporation, partnership, limited liability
company or entity other than the transfer of any such interest between or among
the members of Mortgagor, or to the estate of its current owner, upon the death
of such owner; (d) if Mortgagor, or any general partner or member of Mortgagor,
is a corporation, the creation or issuance of new stock by which an aggregate of
more than 10% of such corporation’s stock shall be vested in a party or parties
who are not now stockholders; and (e) an agreement by Mortgagor leasing all or a
substantial part of the Property for other than actual occupancy by a space
tenant thereunder or a sale, assignment or other transfer of or the grant of a
security interest in and to any Leases.

2.5. No Encumbrances. Except as permitted in the Credit Agreement and for the
Permitted Exceptions, Mortgagor shall not create or permit to exist any
mortgage, pledge, lien, security interest (including, without limitation, a
purchase money security interest), encumbrance, attachment, levy, distraint or
other judicial process on or against the Property or any part thereof
(including, without limitation, fixtures and other personalty), whether superior
or inferior to the lien of this Mortgage.

2.6. Removal of Fixtures. Except as permitted in the Credit Agreement or the
Tranche A Security Agreement, Mortgagor shall not remove or permit to be removed
from the Real Estate any fixtures presently or in the future owned by Mortgagor
as the term “fixtures” is defined by the law of the state where the Property is
located (unless such fixtures have been replaced with similar fixtures of equal
or greater utility and value).

2.7. Compliance with Applicable Laws. Mortgagor agrees to observe, conform and
comply, and to cause its tenants to observe, conform and comply in all material
respects with all applicable federal, state, county, municipal and other
governmental or quasi-governmental laws, rules, regulations, ordinances, codes,
requirements, covenants, conditions, orders, licenses, permits, approvals and

 

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restrictions, including without limitation, Environmental Laws (as defined
below) and the Americans with Disabilities Act of 1990 (collectively, the “Legal
Requirements”), now or hereafter affecting all or any part of the Property, its
occupancy or the business or operations now or hereafter conducted thereon and
the personalty contained therein, within such time as required by such Legal
Requirements to the extent the non-observance, non-conformance or non-compliance
with the Legal Requirements could have a Material Adverse Effect. Mortgagor
represents and warrants that the Property currently is in compliance in all
material respects with all Legal Requirements applicable to the Property.

2.8. Damage, Destruction and Condemnation.

(a) If all or any part of the Property shall be damaged or destroyed, or if
title to or the temporary use of the whole or any part of the Property shall be
taken or condemned by a competent authority for any public or quasi-public use
or purpose, subject to the terms of the Credit Agreement, there shall be no
abatement or reduction in the amounts payable by Mortgagor under the Credit
Agreement and Mortgagor shall continue to be obligated to make such payments.

(b) If all or any part of the Property is partially or totally damaged or
destroyed, Mortgagor shall give prompt notice thereof to Mortgagee, and
Mortgagee may make proof of loss if not made promptly by Mortgagor. Mortgagor
hereby authorizes and directs any affected insurance company to make payment in
excess of $500,000 under such insurance, including return of unearned premiums,
to Mortgagee instead of to Mortgagor and Mortgagee jointly, and Mortgagor
appoints Mortgagee as Mortgagor’s attorney-in-fact to endorse any draft thereof,
which appointment, being for security, is coupled with an interest and
irrevocable. Mortgagee is hereby authorized and empowered by Mortgagor to
settle, adjust or compromise, any claim for loss, damage or destruction to the
Property if Mortgagor does not promptly settle, adjust or compromise such claim.
Mortgagor shall pay all costs of collection of insurance proceeds payable on
account of such damage or destruction. Mortgagor shall have no claim against the
insurance proceeds, or be entitled to any portion thereof, and all rights to the
insurance proceeds are hereby assigned to Mortgagee as security for payment of
the Liabilities. Mortgagee and Mortgagor shall pay or apply all or any part of
the insurance proceeds in accordance with the terms of the Credit Agreement.

(c) Promptly upon obtaining knowledge of the institution of any proceeding for
the condemnation of all or any part of the Property, Mortgagor shall give notice
to Mortgagee. Mortgagor shall, at its sole cost and expense, diligently
prosecute any such proceeding and shall consult with Mortgagee, its attorneys
and experts, and shall cooperate with it in the defense of any such proceeding.
Mortgagee may participate in any such proceeding and Mortgagor shall from time
to time deliver to Mortgagee all instruments requested by it to permit such
participation. Mortgagor shall not, without Mortgagee’s prior written consent in
accordance with the Credit Agreement, enter into any agreement (i) for the
taking or conveyance in lieu thereof of all or any part of the Property, or
(ii) to compromise, settle or adjust any such proceeding. All awards and
proceeds of condemnation in excess of $500,000 are hereby assigned to Mortgagee,
and Mortgagor, upon request by Mortgagee, agrees to make, execute and deliver
any additional assignments or documents necessary from time to time to enable
Mortgagee to collect the same. Such awards and proceeds shall be paid or applied
by Mortgagee and Mortgagor, in accordance with the applicable provisions of the
Credit Agreement.

(d) Nothing herein shall relieve Mortgagor of its duty to repair, restore,
rebuild or replace the Property following damage or destruction or partial
condemnation if no or inadequate insurance proceeds or condemnation awards are
available to defray the cost of repair, restoration, rebuilding or replacement.

 

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(e) Nothing in this Section 2.8 shall be deemed to limit in any respect the
obligations of the Mortgagor under any applicable provision of the Credit
Agreement or Other Collateral Documents. In the event of any conflict between
the terms of this Section 2.8 and the terms of the Credit Agreement, the term of
the Credit Agreement shall apply.

2.9. Required Notices. Mortgagor shall notify Mortgagee within five (5) days of:
(a) receipt of any notice from any governmental or quasi-governmental authority
relating to the structure, use or occupancy of the Property or alleging a
violation of any Legal Requirement; (b) a substantial change in the occupancy or
use of all or any part of the Property; (c) receipt of any default notice from
the holder of any lien or security interest in all or any part of the Property;
(d) commencement of any litigation that could have a Material Adverse Effect;
(e) a pending or threatened condemnation of all or any part of the Property;
(f) a fire or other casualty causing damage in excess of $10,000 to all or any
part of the Property; (g) receipt of any notice with regard to any Release of
Hazardous Substances (as such terms are defined below) or any other
environmental matter which could have a Material Adverse Effect; (h) receipt of
any request for information, demand letter or notification of potential
liability from any entity relating to potential responsibility for investigation
or clean-up of Hazardous Substances on the Property or at any other site owned
or operated by Mortgagor; (i) receipt of any notice from any tenant of all or
any part of the Property alleging a default, failure to perform or any right to
terminate its lease or to set-off rents; or (j) receipt of any notice of the
imposition of, or of threatened or actual execution on, any lien on or security
interest in all or any part of the Property.

3. SECURITY AGREEMENT; COLLATERAL ASSIGNMENT AND PLEDGE OF RIGHTS AS ADDITIONAL
SECURITY.

3.1. This Mortgage constitutes a financing statement filed as a fixture filing
with the Clerk of Court of Caddo Parrish, Louisiana (the “Official Records”) in
which the Real Estate is situated with respect to any and all fixtures included
within the term “Property” as used herein, and with respect to any goods or
other personal property that may now be or hereafter become such fixtures. For
purposes of such financing statement, Mortgagor is the “debtor” and Mortgagee is
the “secured party”, and their respective mailing addresses are those set out in
this Mortgage. Mortgagor hereby grants to Mortgagee a security interest in the
personal and other property (other than real property) included in the Property,
and all replacements of, substitutions for, and additions to, such property, and
the proceeds thereof. Mortgagor shall, at Mortgagor’s own expense, execute,
deliver, file and re-file any financing or continuation statements or other
security agreements Mortgagee may reasonably require from time to time to
perfect, confirm or maintain the lien of this Mortgage with respect to such
property. A photocopy of an executed financing statement shall be effective as
an original. Without limiting the foregoing, if Mortgagor fails to execute,
deliver and file such instruments within ten (10) days after written demand by
Mortgagee, Mortgagor hereby irrevocably appoints Mortgagee attorney-in-fact for
Mortgagor to execute, deliver and file such instruments for or on behalf of
Mortgagor at Mortgagor’s expense, which appointment, being for security, is
coupled with an interest and shall be irrevocable.

3.2. As additional collateral security for the prompt and punctual payment and
satisfaction of any and all present and future Liabilities and Secured Amount as
may be outstanding from time to time, at any one or more times shall not exceed
$190,000,000.00 plus all advances that Mortgagee may make on Mortgagor’s behalf
pursuant to this Mortgage, the Credit Agreement or any Other Documents,
Mortgagor hereby assigns, pledges and grants Mortgagee a continuing security
interest in and to the following rights (the “Rights”):

(a) Proceeds. Any and all proceeds derived or to be derived from the sale,
transfer, conveyance, insurance loss, damage, destruction, condemnation,
expropriation, or other taking of the

 

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Property or other proceeds, and any unearned insurance premiums relating
thereto, including the rights of Mortgagor to receive such proceeds directly
from the obligor or obligors therefor, and to further enforce any rights that
Mortgagor may have to collect such proceeds, including without limitation,
Mortgagor’s rights to commence an appropriate collection or enforcement action
or actions incident thereto.

(b) Leases, Rents and Profits. Any and all present and future leases or
subleases affecting the Property, and all rents, income, and profits there from,
including without limitation, any and all rents, income, profits, bonuses,
revenues, royalties, cash or security deposits, advance rentals and other
payments, and further including Mortgagor’s rights to enforce all present and
future leases or subleases and to receive and enforce any rights that Mortgagor
might have to collect rental and all other payments.

(c) Deposits. Any and all present and future deposits or other security or
advance payments, including rental payments, made by or on behalf of Mortgagor
to others, with respect to (a) utility service regarding the mortgaged Property,
(b) cleaning, maintenance, repair, or similar services regarding the Property,
(c) refuse removal or sewer service regarding the Property, (d) rentals of
equipment, if any, used in the operation by or on behalf of Mortgagor regarding
the Property, and/or (e) parking or similar services or rights regarding the
Property.

(d) Options. Any and all present and future options to sell or to lease the
Property, or any interests therein.

(e) Contract Rights. To the extent assignable and/or transferable, any and all
of Mortgagor’s present and future contract rights, instruments, documents, and
general intangibles necessary for use or useful in connection with the ownership
and operation of all or any part of the Property, whether now existing or
hereafter created, or otherwise acquired by Mortgagor, and all liens, security
interests, guaranties, remedies, privileges and other rights pertaining thereto,
and all rights and remedies of any kind forming the subject matter thereof.

4. ASSIGNMENT OF LEASES AND RENTS.

4.1. Mortgagor hereby absolutely, presently and unconditionally conveys,
transfers and assigns to Mortgagee all of Mortgagor’s right, title and interest,
now existing or hereafter arising, in and to the Leases and Rents.
Notwithstanding that this assignment is effective immediately, so long as no
Event of Default exists, Mortgagor shall have the privilege under a revocable
license granted hereby to operate and manage the Property and to collect, as
they become due, but not prior to accrual, the Rents. Mortgagor shall receive
and hold such Rents in trust as a fund to be applied, and Mortgagor hereby
covenants and agrees that such Rents shall be so applied, first to the
operation, maintenance and repair of the Property and the payment of interest,
principal and other sums becoming due under the Liabilities, before retaining
and/or disbursing any part of the Rents for any other purpose. The license
herein granted to Mortgagor shall automatically, without notice or any other
action by Mortgagee, terminate upon the occurrence of an Event of Default, and
all Rents subsequently collected or received by Mortgagor shall be held in trust
by Mortgagor for the sole and exclusive benefit of Mortgagee. Nothing contained
in this Section 4.1, and no collection by Mortgagee of Rents, shall be construed
as imposing on Mortgagee any of the obligations of the lessor under the Leases.
Mortgagee shall have no legal or contractual responsibility for the condition of
the Property, for any obligation to perform Leases or for any dangerous or
defective condition of the Property. Mortgagor indemnifies and shall defend
Mortgagee and its agents, employees, successors, and assigns (the “Indemnified
Parties”) and to hold them harmless from any cost, expense, liability, loss or
damage, including, without limitation, reasonable attorneys’ fees, which may or
might be incurred by them by reason of the assignment of and security

 

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interest in the Rents and Leases; provided the foregoing indemnity shall not
apply to any act or omission after Mortgagee has taken possession of or become
the owner of the Property. The obligation set forth herein to indemnify, defend,
and hold the Indemnified Parties harmless shall be secured by this Mortgage.

4.2. Mortgagor shall timely perform all of its obligations under the Leases.
Mortgagor represents and warrants that: (a) Mortgagor has title to and full
right to assign presently, absolutely and unconditionally the Leases and Rents;
(b) no other assignment of any interest in any of the Leases or Rents has been
made; (c) there are no leases or agreements to lease all or any portion of the
Property now in effect except the Leases, true and complete copies of which have
been furnished to Mortgagee, and no written or oral modifications have been made
thereto; (d) there is no existing default by Mortgagor or by any tenant under
any of the Leases, nor has any event occurred which due to the passage of time,
the giving or failure to give notice, or both, would constitute a default under
any of the Leases and, to the best of Mortgagor’s knowledge, no tenant has any
defenses, set-offs or counterclaims against Mortgagor; (e) the Leases are in
full force and effect; and (f) Mortgagor has not accepted Rent under any Lease
more than thirty (30) days in advance of its accrual, and payment thereof has
not otherwise been forgiven, discounted or compromised.

5. DECLARATION OF NO OFFSET. Mortgagor represents to Mortgagee that Mortgagor
has no knowledge of any offsets, counterclaims or defenses to the Liabilities
either at law or in equity. Mortgagor shall, within ten (10) days after written
request, furnish to Mortgagee or Mortgagee’s designee a written statement in
form reasonably satisfactory to Mortgagee stating the amount due under the
Liabilities and whether, to Mortgagor’s knowledge, there are offsets or defenses
against the same, and if so, the nature and extent thereof.

6. ENVIRONMENTAL MATTERS.

6.1. Definitions. As used herein, “Environmental Laws” shall mean all applicable
existing or future federal, state and local statutes, ordinances, regulations,
rules, executive orders, standards and requirements, including the requirements
imposed by common law, concerning or relating to industrial hygiene and the
protection of health and the environment including but not limited to: (a) those
relating to the generation, manufacture, storage, transportation, disposal,
release, emission or discharge of Hazardous Substances (as hereinafter defined);
(b) those in connection with the construction, fuel supply, power generation and
transmission, waste disposal or any other operations or processes relating to
the Property; and (c) those relating to the atmosphere, soil, surface and ground
water, wetlands, stream sediments and vegetation on, under, in or about the
Property. Any terms mentioned herein which are defined in any Environmental Law
shall have the meanings ascribed to such terms in said laws; provided, however,
that if any of such laws are amended so as to broaden any term defined therein,
such broader meaning shall apply subsequent to the effective date of such
amendment.

6.2. Representations, Warranties and Covenants. Except as disclosed in that
certain Phase I Environmental Site Assessment Update dated February 18, 2003
prepared by URS Corporation (a copy of which has been provided by Mortgagor to
Mortgagee), Mortgagor represents, warrants, covenants and agrees as follows:

(a) To Mortgagor’s knowledge, neither Mortgagor nor the Property or any occupant
thereof is in material violation of or subject to any existing, pending or
threatened investigation or inquiry by any governmental authority pertaining to
any Environmental Law. Mortgagor shall not cause or permit the Property to be in
violation in any material respect of, or do anything which would subject the
Property to any remedial obligations under, any Environmental Law, and shall
promptly notify

 

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Mortgagee in writing of any existing, pending or threatened investigation or
inquiry of which Mortgagor has knowledge by any governmental authority in
connection with any Environmental Law. In addition, Mortgagor shall provide
Mortgagee with copies of any and all material written communications with any
governmental authority in connection with any violation of any Environmental
Law, concurrently with Mortgagor’s giving or promptly after Mortgagor’s
receiving of same.

(b) To Mortgagor’s knowledge, no material release, spill, discharge, leak,
disposal or emission (individually a “Release” and collectively, “Releases”) of
a Hazardous Material (as defined in the Credit Agreement), including gasoline,
petroleum products, explosives, toxic substances, solid wastes and radioactive
materials in any material amount (collectively, “Hazardous Substances”) has
occurred, nor are there any visible signs of, any Release(s) at, upon, under or
within the Property. During the term of this Mortgage, to the extent required by
any Environmental Laws, Mortgagor shall remove or remediate any Release at the
Property promptly upon discovery at its sole cost and expense.

(c) To Mortgagor’s knowledge, the Property has never been used by the previous
owners and/or operators nor has it or will it be used by Mortgagor during the
term of this Mortgage to refine, produce, store, handle, transfer, process,
transport, generate, manufacture, heat, treat, recycle or dispose of Hazardous
Substances, except for such quantities as are handled in accordance with
applicable manufacturers’ instructions and Environmental Laws and in proper
storage containers as are necessary for the operation of the commercial business
of Mortgagor or its tenants (“Permitted Substances”).

(d) The Property: (i) is being and has been operated by Mortgagor in compliance
in all material respects with all Environmental Laws, and all permits required
thereunder have been obtained and complied with in all material respects; and
(ii) does not have any Hazardous Substances present excepting Permitted
Substances.

(e) Mortgagor will, and will cause its tenants to, operate the Property in
material compliance with all Environmental Laws and, other than Permitted
Substances, will not place or permit to be placed any Hazardous Substances on
the Property.

(f) During Mortgagor’s period of ownership of the Real Estate, and to
Mortgagor’s knowledge prior thereto, no lien has been attached to or threatened
to be imposed upon the Property, and, to Mortgagor’s knowledge, there is no
basis for the imposition of any such lien based on any governmental action under
Environmental Laws. In the event that any environmental lien is filed against
the Property, Mortgagor shall, within thirty (30) days from the date that
Mortgagor is given notice of such lien (or within such shorter period of time as
is appropriate in the event that steps have commenced to have the Property
sold), either: (i) pay the claim and remove the lien from the Property; or
(ii) furnish a cash deposit, bond or other security reasonably satisfactory in
form and substance to Mortgagee in an amount sufficient to discharge the claim
out of which the lien arises.

6.3. Right to Inspect and Cure. To the extent provided in the Tranche A Security
Agreement, Mortgagee shall have the right to conduct or have conducted by its
agents or contractors such environmental inspections, audits and tests as
Mortgagee shall deem necessary or advisable from time to time at the sole cost
and expense of Mortgagor.

Nothing in this Article 6 shall be deemed to limit in any respect the
obligations of the Mortgagor under any applicable provision of the Tranche A
Security Agreement.

7. INTENTIONALLY DELETED

 

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8. REMEDIES. If an Event of Default (as defined in the Credit Agreement) shall
have occurred, Mortgagee may take any of the following actions:

8.1. Acceleration. Mortgagee may exercise all rights and remedies under the
Credit Agreement.

8.2. Possession. Mortgagee may enter upon and take possession of the Property,
with or without legal action, lease the Property, collect therefrom all rentals
and, after deducting all out-of-pocket costs of collection and administration
expense, apply the net rentals to any one or more of the following items in such
manner and in such order of priority as Mortgagee, in Mortgagee’s sole
discretion, may elect: the payment of any sums due under any prior lien, taxes,
water and sewer rents, charges and claims, insurance premiums and all other
carrying charges, to the maintenance, repair or restoration of the Property, or
on account of the Liabilities. Mortgagee is given full authority to do any act
which Mortgagor could do in connection with the management and operation of the
Property. This covenant is effective either with or without any action brought
to foreclose this Mortgage and without applying for a receiver of such rents. In
addition to the foregoing, upon the occurrence of an Event of Default, Mortgagor
shall pay monthly in advance to Mortgagee or to any receiver appointed to
collect said rents the fair and reasonable rental value for Mortgagor’s use and
occupation of the Property, and upon default in any such payment Mortgagor shall
vacate and surrender the possession of the Property to Mortgagee or to such
receiver. If Mortgagor does not vacate and surrender the Property then Mortgagor
may be evicted by summary proceedings.

8.3. Seizure and Sale of Property. In the event that Mortgagee elects to
commence appropriate Louisiana foreclosure proceedings under this Mortgage,
Mortgagee may cause the Property, or any part or parts thereof, to be
immediately seized and sold whether in term of court or in vacation, under
ordinary or executory process, in accordance with applicable Louisiana law, to
the highest bidder for cash, with or without appraisement, and without the
necessity of making additional demand upon or notifying Mortgagor, all of which
are expressly waived. The unpaid balance of any judgment shall bear interest at
the greater of (a) the statutory rate provided for judgments, or (b) the rate
borne by the Tranche A Loans. Without limiting the foregoing, Mortgagee may
foreclose this Mortgage and exercise its rights as a secured party for all or
any portion of the Liabilities which are then due and payable, subject to the
continuing lien of this Mortgage for the balance not then due and payable. In
case of any sale of the Property by judicial proceedings, the Property may be
sold in one parcel or in such parcels, manner or order as Mortgagee in its sole
discretion may elect. Mortgagor, for itself and anyone claiming by, through or
under it, hereby agrees that Mortgagee shall in no manner, in law or in equity,
be limited, except as herein provided, in the exercise of its rights in the
Property or in any other security hereunder or otherwise appertaining to the
Liabilities or any other obligation secured by this Mortgage, whether by any
statute, rule or precedent which may otherwise require said security to be
marshalled in any manner and Mortgagor, for itself and others as aforesaid,
hereby expressly waives and releases any right to or benefit thereof. The
failure to make any tenant a defendant to a foreclosure proceeding shall not be
asserted by Mortgagor as a defense in any proceeding instituted by Mortgagee to
collect the Liabilities or any deficiency remaining unpaid after the foreclosure
sale of the Property.

8.4. Confession of Judgment. For purposes of foreclosure under Louisiana
executory process procedures, Mortgagor confesses judgment and acknowledges to
be indebted unto and in favor of Mortgagee, up to the full amount of the Secured
Amount, in principal, interest, costs, expenses, attorneys’ fees and other fees
and charges. Mortgagor further confesses judgment and acknowledges to be
indebted unto and in favor of Mortgagee in the amount of all advances that
Mortgagee may make on Mortgagor’s behalf pursuant to this Mortgage, together
with interest thereon. To the extent permitted under applicable Louisiana law,
Mortgagor additionally waives:

 

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(a) the benefit of appraisal as provided in Articles 2332, 2336, 2723 and 2724
of the Louisiana Code of Civil Procedure, and all other laws with regard to
appraisal upon judicial sale; (b) the demand and three (3) days’ delay as
provided under Articles 2639 and 2721 of the Louisiana Code of Civil Procedure;
(c) the notice of seizure as provided under Articles 2293 and 2721 of the
Louisiana Code of Civil Procedure; (d) the three (3) days’ delay provided under
Articles 2331 and 2722 of the Louisiana Code of Civil Procedure; and (e) all
other benefits provided under Articles 2331, 2722 and 2723 of the Louisiana Code
of Civil Procedure and all other Articles not specifically mentioned above.

8.5. Keeper. Should any or all of the Property be seized as an incident to an
action for the recognition or enforcement of this Mortgage, by executory
process, sequestration, attachment, writ of fieri facias or otherwise, Mortgagor
hereby agrees that the court issuing any such order shall, if requested appoint
Mortgagee, or any agent designated by Mortgagee, or any person or entity named
by Mortgagee at the time such seizure is requested, or any time thereafter, as
Keeper of the Property as provided under La. R.S. 9:5136, et seq. Such a Keeper
shall be entitled to reasonable compensation. Mortgagor agrees to pay the
reasonable fees of such Keeper, which are hereby fixed at $150.00 per hour,
which compensation to the Keeper shall also be secured by this Mortgage in the
form of a future advance as provided herein. Mortgagor agrees to promptly
deliver to any such Keeper all Leases, Rents, contracts, documents, financial
data and other information requested by such Keeper in connection with the
Property and, without limiting the foregoing, Mortgagor hereby authorizes
Mortgagee to deliver to any such Keeper any or all of the Leases, Rents,
contracts, documents, data and information in Mortgagee’s possession relating to
the Property.

8.6. Declaration of Fact. Should it become necessary for Mortgagee to foreclose
under this Mortgage, all declarations of fact, which are made under an authentic
act before a Notary Public in the presence of two witnesses, by a person
declaring such facts to lie within his or her knowledge, shall constitute
authentic evidence for purposes of executory process and also for purposes of
La. R.S. 9:3509.1, La. R.S. 9:3504(D)(6) and La. R.S. 10:9-508, where
applicable.

8.7. Separate Sale of Mortgagor’s Rights Following Default. Should one or more
Events of Default occur or exist under this Mortgage, Mortgagee shall have the
additional right, at its sole option, to separately sell the aforesaid
Mortgagor’s Rights, or any part or parts thereof, at private or public sale, at
such price or prices as Mortgagee may deem best, either for cash or for any
other compensation, or on credit, or for future delivery, without the assumption
of any credit risk. The sale of the aforesaid Rights may be without
appraisement, the benefit of which is also expressly waived by Mortgagor.
Mortgagee may exercise any other remedies with regard to Mortgagor’s Rights as
may be authorized under the Louisiana Commercial Laws (La. R.S. 10:9-101, et
seq.).

8.8. Automatic Transfer of Rights. In the event of foreclosure under this
Mortgage, or other transfer of title or assignment of the Property, or any part
or parts thereof, in lieu of payment of the Liabilities and the Secured Amount
whether in whole or in part, all policies of insurance and other Rights
applicable to the foreclosed upon or transferred Property shall automatically
inure to the benefit of and shall pass to the purchaser(s) or transferee(s)
thereof, subject to the rights of the purchaser(s) or transferee(s) to reject
such insurance coverage and/or Rights at its or their sole option and election.

8.9. Specific Performance. Mortgagee may, in addition to the foregoing remedies,
or in lieu thereof, in Mortgagee’s sole discretion, commence an appropriate
action against Mortgagor seeking specific performance of any covenant contained
herein, or in aid of the execution or enforcement of any power herein granted.
Mortgagee may institute any one or more actions of mortgage foreclosure against
all or any part of the Property, or take such other action at law, equity or by
contract for the enforcement

 

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of this Mortgage and realization on the security herein or elsewhere provided
for, as the law may allow, and may proceed therein to final judgment and
execution for the entire unpaid balance of the Liabilities. The unpaid balance
of any judgment shall bear interest at the greater of (a) the statutory rate
provided for judgments, or (b) the rate borne by the Tranche A Loans. Without
limiting the foregoing, Mortgagee may foreclose this Mortgage and exercise its
rights as a secured party for all or any portion of the Liabilities which are
then due and payable, subject to the continuing lien of this Mortgage for the
balance not then due and payable. In case of any sale of the Property by
judicial proceedings, the Property may be sold in one parcel or in such parcels,
manner or order as Mortgagee in its sole discretion may elect. Mortgagor, for
itself and anyone claiming by, through or under it, hereby agrees that Mortgagee
shall in no manner, in law or in equity, be limited, except as herein provided,
in the exercise of its rights in the Property or in any other security hereunder
or otherwise appertaining to the Liabilities or any other obligation secured by
this Mortgage, whether by any statute, rule or precedent which may otherwise
require said security to be marshalled in any manner and Mortgagor, for itself
and others as aforesaid, hereby expressly waives and releases any right to or
benefit thereof. The failure to make any tenant a defendant to a foreclosure
proceeding shall not be asserted by Mortgagor as a defense in any proceeding
instituted by Mortgagee to collect the Liabilities or any deficiency remaining
unpaid after the foreclosure sale of the Property.

8.10. Rights as a Secured Party. Mortgagee shall have, in addition to other
rights and remedies available at law or in equity, the rights and remedies of a
secured party under the Code. Mortgagee may elect to foreclose such of the
Property as then comprise fixtures pursuant either to the law applicable to
foreclosure of an interest in real estate or to that applicable to personal
property under the Code. To the extent permitted by law, Mortgagor waives the
right to any stay of execution and the benefit of all exemption laws now or
hereafter in effect.

8.11. Excess Monies. Mortgagee may apply on account of the Liabilities any
unexpended monies still retained by Mortgagee that were paid by Mortgagor to
Mortgagee: (a) for the payment of, or as security for the payment of taxes,
assessments or other governmental charges, insurance premiums, or any other
charges; or (b) to secure the performance of some act by Mortgagor.

8.12. Other Remedies. Mortgagee shall have the right, from time to time, to
bring an appropriate action to recover any sums required to be paid by Mortgagor
under the terms of this Mortgage, as they become due, without regard to whether
or not any other Liabilities shall be due, and without prejudice to the right of
Mortgagee thereafter to bring an action of mortgage foreclosure, or any other
action, for any default by Mortgagor existing at the time the earlier action was
commenced. In addition, Mortgagee shall have the right to set-off all or any
part of any amount due by Mortgagor to Mortgagee under any of the Liabilities,
against any indebtedness, liabilities or obligations owing by Mortgagee in any
capacity to Mortgagor, including any obligation to disburse to Mortgagor any
funds or other property on deposit with or otherwise in the possession, control
or custody of Mortgagee.

8.13. Attorney-In-Fact. Mortgagor hereby constitutes Mortgagee its
attorney-in-fact with full power of substitution to take possession of the
Property upon any Event of Default and, as Mortgagee in its sole discretion
deems necessary or proper, to execute and deliver all instruments required by
Mortgagee to accomplish the disposition of the Property; this power of attorney
is a power coupled with an interest and is irrevocable while any of the
Liabilities are outstanding.

8.14. Waiver. Mortgagor waives, to the extent permitted by law, (a) the benefit
of all laws now existing or that may hereafter be enacted providing for any
appraisement before sale of any portion of the Property, (b) all rights of
reinstatement, redemption, valuation, appraisement, homestead, moratorium,
exemption, extension, stay of execution, notice of election to mature or declare
due the

 

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whole of the Liabilities in the event of foreclosure of the liens hereby
created, (c) all rights and remedies which Mortgagor may have or be able to
assert by reason of the laws of the State of Louisiana pertaining to the rights
and remedies of sureties, and (d) any rights, legal or equitable, to require
marshaling of assets or to require foreclosure sales in a particular order.
Without limiting the generality of the preceding sentence, Mortgagor, on its own
behalf and on behalf of each and every person acquiring any interest in or title
to the Property subsequent to the date of this Mortgage, hereby irrevocably
waives, to the extent permitted by law, any and all rights of reinstatement or
redemption from sale or from or under any order, judgment or decree of
foreclosure of this Mortgage or under any sale pursuant to any statute order
decree or judgment of any court. Mortgagor, for itself and for all persons
hereafter claiming through or under it or who may at any time hereafter become
holders of liens junior to the lien of this Mortgage, hereby expressly waives
and releases all rights to direct the order in which any of the Property shall
be sold in the event of any sale or sales pursuant hereto and to have any of the
Property and/or any other property now or hereafter constituting security for
any of the indebtedness secured hereby marshaled upon any foreclosure of this
Mortgage or of any other security for any of said indebtedness. Mortgagee shall
have the right to determine the order in which any or all of the Property shall
be subjected to the remedies provided herein. Mortgagee shall have the right to
determine the order in which any or all portions of the Liabilities are
satisfied from the proceeds realized upon the exercise of the remedies provided
herein, in accordance with the applicable provisions of the Tranche A Security
Agreement.

9. NO LIABILITY ON MORTGAGEE. Notwithstanding anything contained in this
Mortgage, Mortgagee shall not be obligated to perform or discharge, and does not
undertake to perform or discharge, any obligation, duty or liability of
Mortgagor, whether under this Mortgage, under any of the Leases, under any
Contract or under any other Property, and Mortgagor shall and does hereby agree
to indemnify against and hold Mortgagee harmless of and from: any and all
liabilities, losses or damages which Mortgagee may incur or pay under or with
respect to any of the Property or under or by reason of its exercise of rights
hereunder; and any and all claims and demands whatsoever which may be asserted
against it by reason of any alleged obligations or undertakings on its part to
perform or discharge any of the terms, covenants or agreements contained in any
of the Property or in any of the contracts, documents or instruments evidencing
or creating any of the Property. Mortgagee shall not have responsibility for the
control, care, management or repair of the Property or be responsible or liable
for any negligence in the management, operation, upkeep, repair or control of
the Property resulting in loss, injury or death to any tenant, licensee,
employee, stranger or other person. No liability shall be enforced or asserted
against Mortgagee in its exercise of the powers herein granted to it, and
Mortgagor expressly waives and releases any such liability. Should Mortgagee
incur any such liability, loss or damage under any of the Leases or under or by
reason hereof, or in the defense of any claims or demands, Mortgagor agrees to
reimburse Mortgagee within ten (10) days after demand for the full amount
thereof, including costs, expenses and reasonable attorneys’ fees.
Notwithstanding the foregoing, Mortgagee shall not be released of liability nor
entitled to be indemnified by Mortgagor for any liability, loss or damage to the
extent arising from any act or omission of Mortgagee after Mortgagee takes
physical possession of the Property or becomes owner of the Property.

10. MORTGAGEE’S RIGHT TO DIRECTLY COLLECT AND RECEIVE PROCEEDS AND PAYMENTS
BEFORE OR AFTER DEFAULT. Mortgagee shall have the right, at its sole option and
election, at any time following an Event of Default, to directly collect and
receive all proceeds and/or payments arising under or in any way accruing from
the Property, as such amounts become due and payable. In order to permit the
foregoing, Mortgagor unconditionally agrees to deliver to Mortgagee, immediately
following demand, any and all of Mortgagor’s records, ledger sheets, and other
documentation, in the form requested by Mortgagee, with regard to the Property
and any and all proceeds and/or payments applicable thereto. Mortgagee shall
have the further right, upon an Event of Default,

 

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where appropriate and within Mortgagee’s sole discretion, to file suit, either
in Mortgagee’s own name or in the name of Mortgagor, to collect any and all
proceeds and payments that may then and/or in the future be due and owing under
and/or as a result of Mortgagor’s ownership of the Property. Where it is
necessary for Mortgagee to attempt to collect any such proceeds and/or payments
from the obligors therefor, Mortgagee may compromise, settle, extend, or renew
for any period (whether or not longer than the original period) any obligation
or indebtedness thereunder or evidenced thereby, or surrender, release, or
exchange all or any part of said obligation or indebtedness, without affecting
the liability of Mortgagor under this Mortgage, Credit Agreement or Other
Documents. To that end, Mortgagor hereby irrevocably constitutes and appoints
Mortgagee as its attorney-in-fact, coupled with an interest and with full power
of substitution, to take any and all such actions and any and all other actions
permitted hereby, either in the name of Mortgagor or Mortgagee.

11. PROTECTION OF MORTGAGEE’S SECURITY RIGHTS. Subject to the Permitted
Exceptions, Mortgagor will be fully responsible for any losses that Mortgagee
may suffer as a result of anyone other than Mortgagee asserting any rights or
interest in or to the Property and/or Mortgagor’s Rights collaterally assigned
and pledged hereunder. Mortgagor agrees to appear in and to defend all actions
or proceedings purporting to affect Mortgagee’s security interests in any of the
Property and/or Rights subject to this Mortgage and any of the rights and powers
granted Mortgagee hereunder. In the event that Mortgagor fails to do what is
required of it under this Mortgage, or if any action or proceeding is commenced
naming Mortgagee as a party or affecting Mortgagee’s security interests or the
rights and powers granted under this Mortgage, then Mortgagee may, without
releasing Mortgagor from any of its obligations under this Mortgage, do whatever
Mortgagee believes to be necessary and proper within its sole discretion to
protect the security of this Mortgage, including without limitation making
advances on Mortgagor’s behalf as provided herein. Should the reappraisal of the
Property occur, whether to comply with appropriate regulatory requirements or
otherwise, Mortgagor agrees to pay the costs of such appraisal or reappraisals
or to reimburse Mortgagee for the costs thereof.

12. INDEMNIFICATION OF MORTGAGEE. Mortgagor agrees to indemnify, to defend and
to save and hold Mortgagee harmless from any and all claims, suits, obligations,
damages, losses, costs, expenses (including, without limitation, Mortgagee’s
reasonable attorney’s fees), demands, liabilities, penalties, fines and
forfeitures of any nature whatsoever that may be asserted against or incurred by
employees, and agents arising out of or in any manner occasioned by this
Mortgage and the exercise of the rights and remedies granted Mortgagee
hereunder. The foregoing indemnity provisions shall survive the cancellation of
this Mortgage as to all matters arising or accruing prior to such cancellation
and the foregoing indemnity shall survive in the event that Mortgagee elects to
exercise any of the remedies as provided under this Mortgage following default
hereunder; provided, however, the foregoing indemnification shall not apply to
any act or omission occurring after Mortgagee has taken possession of or become
the owner of the Property.

13. EXECUTION OF ADDITIONAL DOCUMENTS. Mortgagor agrees to execute all
additional documents, instruments and agreements that Mortgagee may deem to be
necessary within its reasonable discretion, in form and substance reasonably
satisfactory to Mortgagee, to keep this Mortgage in effect, to better reflect
the true intent of this Mortgage, and to consummate fully all of the
transactions contemplated hereby and by any other agreement, instrument or
document heretofore, now or at any time or times hereafter executed by Mortgagor
and delivered to Mortgagee.

14. MISCELLANEOUS.

14.1. Notices. All notices and communications under this Mortgage shall be in
writing and shall be given by either (a) hand-delivery, (b) first class mail
(postage prepaid), or (c) reliable overnight

 

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commercial courier (charges prepaid), to the addresses listed in the preamble of
this Mortgage. Notice shall be deemed to have been given and received: (a) if by
hand delivery, upon delivery; (b) if by mail, three (3) business days after the
date first deposited in the United States mail; and (c) if by overnight courier,
on the date scheduled for delivery. A party may change its address by giving
written notice to the other party as specified herein.

14.2. No Property Manager Lien. Any property management agreement for or
relating to all or any part of the Property, whether now in effect or entered
into hereafter by Mortgagor or on behalf of Mortgagor, shall contain a
subordination provision whereby the property manager forever and unconditionally
subordinates to the lien of this Mortgage any and all mechanic’s lien rights and
claims that it or anyone claiming through or under it may have at any time
pursuant to any statute or law. Such property management agreement or a short
form thereof, including such subordination, shall, at Mortgagee’s request, be
recorded with the office of the recorder of deeds for the county in which the
Property is located. Mortgagor’s failure to cause any of the foregoing to occur
shall constitute an Event of Default under this Mortgage.

14.3. Remedies Cumulative. The rights and remedies of Mortgagee as provided in
this Mortgage, in the Credit Agreement or in any Other Document shall be
cumulative and concurrent, may be pursued separately, successively or together,
may be exercised as often as occasion therefor shall arise, and shall be in
addition to any other rights or remedies conferred upon Mortgagee at law or in
equity. The failure, at any one or more times, of Mortgagee to assert the right
to declare the Liabilities due, grant any extension of time for payment of the
Liabilities, take other or additional security for the payment thereof, release
any security, change any of the terms of the Credit Agreement or any of the
Other Documents, or waive or fail to exercise any right or remedy under the
Credit Agreement or any Other Document shall not in any way affect this Mortgage
or the rights of Mortgagee.

14.4. No Implied Waiver. Mortgagee shall not be deemed to have modified or
waived any of its rights or remedies hereunder unless such modification or
waiver is in writing and signed by Mortgagee, and then only to the extent
specifically set forth therein. A waiver in one event shall not be construed as
continuing or as a waiver of or bar to such right or remedy on a subsequent
event.

14.5. Partial Invalidity. The invalidity or unenforceability of any one or more
provisions of this Mortgage shall not render any other provision invalid or
unenforceable. In lieu of any invalid or unenforceable provision, there shall be
added automatically a valid and enforceable provision as similar in terms to
such invalid or unenforceable provision as may be possible.

14.6. Binding Effect. The covenants, conditions, waivers, releases and
agreements contained in this Mortgage shall bind, and the benefits thereof shall
inure to, the parties hereto and their respective heirs, executors,
administrators, successors and assigns and are intended and shall be held to be
real covenants running with the land; provided, however, that, except in
connection with a transfer expressly permitted by the Credit Agreement or
consented to in writing by Mortgagee, this Mortgage cannot be assigned by
Mortgagor without the prior written consent of Mortgagee, and any such
assignment or attempted assignment by Mortgagor shall be void and of no effect
with respect to Mortgagee.

14.7. Modifications. This Mortgage may not be supplemented, extended, modified
or terminated except by an agreement in writing signed by the party against whom
enforcement of any waiver, change, modification or discharge is
sought. Mortgagee may release, regardless of consideration, any part of the
Property without, as to the remainder, in any way impairing, affecting,
subordinating or releasing the lien or security interests evidenced by this
Mortgage, the Credit Agreement or the Other

 

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Documents or affecting the obligations of Mortgagor or any other party to pay
the Liabilities or perform and discharge the Liabilities.

14.8. Governing Law. This Mortgage shall be governed, construed, interpreted and
enforced in accordance with the laws of the State of New York, without regard to
principles of conflicts of law, except as to matters relating to the creation,
perfection and enforcement of the liens on and security interests in the
Property (including, without limitation, requests for injunctive relief or
appointment of a receiver) which shall be governed by the laws of the state
where the Property is located.

14.9. Non-Merger. In the event Mortgagee shall acquire title to the Property by
conveyance from Mortgagor or as a result of foreclosure, this Mortgage shall not
merge in the fee estate of the Property but shall remain and continue as an
existing and enforceable lien for the Liabilities secured hereby until the same
shall be released of record by Mortgagee in writing.

15. STATE SPECIFIC PROVISIONS.

15.1. Principles of Construction. In the event of any inconsistencies between
the terms and conditions of this Article and the other terms and conditions of
this Mortgage, the terms and conditions of this Article shall control and be
binding.

15.2. Future Advances. Without limiting any other provision of this Mortgage,
Mortgagee may make future advances and this Mortgage shall also secure repayment
of any future advances made by Mortgagee and the unpaid balances of other
advances made, with respect to the Property, for the payment of taxes,
assessments, maintenance, charges, insurance premiums or costs similar or
dissimilar incurred for the protection of the Property or for the lien of this
Mortgage, expenses incurred by Mortgagee, or advances made under a construction
loan, if any, to enable the completion of the improvements for which the
construction loan was originally made.

15.3. Tax Identification Number. Mortgagor hereby represents and warrants to
Mortgagee that Mortgagor’s Federal Tax Identification Number is 86-0699193.

[Signature page follows]

 

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THUS DONE AND PASSED, on the day, month and year first written above in the
presence of the undersigned Notary and the undersigned competent witnesses, who
hereunto sign their names with Mortgagor after reading of the whole.

 

WITNESSES:    

MORTGAGOR:

WINCUP HOLDINGS, INC.

/s/ Caroline J. Williamson

   

By:

 

/s/ Michael T. Kennedy

Name:

 

Caroline J. Williamson

     

Name:

 

Michael T. Kennedy

       

Title:

 

President and CEO

/s/ Victoria W. O’Rourke

       

Name:

 

Victoria W. O’Rourke

             

/s/ Susan E. Dear

     

NOTARY PUBLIC

         

(SEAL)

MY COMMISSION EXPIRES: January 8, 2009

Notarial Seal

Susan E. Dear, Notary Public

Bethel Twp., Delaware County

My commission expires January 8, 2009

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SCHEDULE A

Legal Description

That certain real property located in the City of Shreveport, Caddo Parish,
State of Louisiana, having a street address of 7501 East Trammel Drive,
Shreveport, Louisiana 71108, more particularly described as follows:

A TRACT OF LAND in Sections 26 and 27, township 17 North, Range 14 West, and
being part of 163.477 acre tract acquired by the Southwestern Town Lot
Corporation, Caddo Parish, Louisiana, and being more particularly described as
follows:

Commencing at a found nail in the intersection of the centerline of Valley View
Drive and the centerline of Trammel Drive as shown on the plat of South
Industrial Park Second Filing as recorded in Conveyance Book 1200, page 231,
records of Caddo Parish, Louisiana, thence run South 14° 17’ 39” West with the
centerline of Trammel Drive a distance of 40 feet to a point; thence run South
75° 10’ East a distance of 30 feet to a point on the East right of way line of
Trammel Drive and the South right of way line of Valley View Drive for the True
Point of Beginning; thence run South 75° 10’ East with the South right of way
line of Valley View Drive a distance of 328.77 feet to a set iron rod marking
the point of curve of a curve to the right; thence continue with said right of
way line and said curve having a radius of 533.68 feet, a central angle of 67°
50’ 42” an arc length of 631.94 feet to a set iron rod being the intersection of
the West right of way line of Valley View Drive with the centerline of an
existing Railroad Spur projected Eastward; thence run North 75° 06’ 36” West
with said Railroad Spur a distance of 819.93 feet to a point in the East right
of way line of Trammel Drive; thence run North 14° 17’ 39” East with said right
of way line a distance of 331.63 feet to the Point of Beginning.