tie8k081231-102.htm


    SECURED
PROMISSORY NOTE

    


    


    $16,700,000                                                                     December 31,
2008                             Dallas,
Texas

    


    


    FOR VALUE RECEIVED, the
undersigned, Contran Corporation, a Delaware corporation (“Makes”),
promises to pay to the order of Titanium Metals Corporation, a Delaware
corporation, or any subsequent holder (“Payee”),
in lawful money of the United States of America, the principal sum of SIXTEEN MILLION SEVEN HUNDRED
THOUSAND DOLLARS ($16,700,000) together with interest from the date
hereof on the unpaid principal balance from time to time pursuant to the terms
of this promissory note (this “Note”).  Capitalized
terms not otherwise defined shall have the meanings given to such terms in Section 15 of this
Note.

    


    Section 1.  Place of
Payment.  All payments will be made at Payee’s address at Three
Lincoln Centre, 5430 LBJ Freeway, Suite 1700, Dallas,
Texas   75240-2697,  Attention:  Treasurer,
or such other place as the holder may from time to time appoint in
writing.

    


    Section 2.  Payment.  The
unpaid principal balance of this Note and any unpaid and accrued interest
thereon shall be due and payable on December 31, 2011 or upon acceleration as
provided herein.  Prior to the final payment of this Note, unpaid and
accrued interest on the outstanding principal balance of this Note shall be due
and payable quarterly on March 31, June 30, September 30 and December 31 of each
year; provided,
however, that such day is a business day, and if such day is not a
business day, the quarterly interest payment shall be due the next successive
business day.

    


    Section 3.  Prepayment.  This
Note may be prepaid in part or in full at any time without penalty; provided, however,
prepayments shall be first applied to accrued and unpaid interest and then to
principal.  The Maker shall not be entitled to reborrow any amounts
prepaid under this Note.

    


    Section 4.  Interest.  The
unpaid principal balance of this Note (exclusive of any past due principal)
shall bear interest at the rate per annum of the Prime Rate less one and
one-half percent.  Accrued interest on the unpaid principal of this
Note shall be computed on the basis of a 365- or 366-day year for actual days
elapsed, but in no event shall such computation result in an amount of accrued
interest that would exceed accrued interest on the unpaid principal balance
during the same period at the Maximum Rate. Notwithstanding anything to the
contrary, this Note is expressly limited so that in no contingency or event
whatsoever shall the amount paid or agreed to be paid to the holder exceed the
Maximum Rate.  If, from any circumstances whatsoever, the holder shall
ever receive as interest an amount that would exceed the Maximum Rate, such
amount that would be excessive interest shall be applied to the reduction of the
unpaid principal balance and not to the payment of interest, and if the
principal amount of this Note is paid in full, any remaining excess shall be
paid to Maker, and in such event, the holder shall not be subject to any
penalties provided by any laws for contracting for, charging, taking, reserving
or receiving interest in excess of the highest lawful rate permissible under
applicable law.  All sums paid or agreed to be paid to Payee or the
holder of this Note for the use, forbearance or detention of the indebtedness of
the Maker to Payee or the holder of this Note shall, to the extent permitted by
applicable law, be amortized, prorated, allocated and spread throughout the full
term of such indebtedness until payment in full of the principal (including the
period of any renewal or extension thereof) so that the interest on account of
such indebtedness shall not exceed the Maximum Rate.  If at any time
the Contract Rate is limited to the Maximum Rate, any subsequent reductions in
the Contract Rate shall not reduce the rate of interest on this Note below the
Maximum Rate until the total amount of interest accrued equals the amount of
interest that would have accrued if the Contract Rate had at all times been in
effect.  In the event that, upon demand or acceleration of this Note
or at final payment of this Note, the total amount of interest paid or accrued
on this Note is less than the amount of interest that would have accrued if the
Contract Rate had at all times been in effect with respect thereto, then at such
time, to the extent permitted by law, in addition to the principal and any other
amounts Maker owes to the holder of this Note, the Maker shall pay to the holder
of this Note an amount equal to the difference between:  (i) the
lesser of the amount of interest that would have accrued if the Contract Rate
had at all times been in effect or the amount of interest that would have
accrued if the Maximum Rate had at all times been in effect; and (ii) the amount
of interest actually paid on this Note.

    


    Section 5.  Remedy.  Upon
the occurrence and during the continuation of an Event of Default, the holder
shall have all of the rights and remedies provided in the applicable Uniform
Commercial Code, this Note, the Pledge Agreement or any other agreement of Maker
and in favor of the holder, as well as those rights and remedies provided by any
other applicable law, rule or regulation.  In conjunction with and in
addition to the foregoing rights and remedies of the holder hereof, the holder
hereof may declare all indebtedness due under this Note, although otherwise
unmatured, to be due and payable immediately without notice or demand
whatsoever. All rights and remedies of the holder are cumulative and may be
exercised singly or concurrently.  The exercise of any right or remedy
will not be a waiver of any other right or remedy.

    


    Section 6.  Right of
Offset.  The holder shall have the right of offset against
amounts that may be due by the holder now or in the future to Maker against
amounts due under this Note.

    


    Section 7.  Record of
Outstanding Indebtedness.  The date and amount of each
repayment of principal outstanding under this Note or interest thereon shall be
recorded by Payee in its records.  The principal balance outstanding
and all accrued or accruing interest owed under this Note as recorded by Payee
in its records shall be the best evidence of the principal balance outstanding
and all accrued or accruing interest owed under this Note; provided that the failure of
Payee to so record or any error in so recording or computing any such amount
owed shall not limit or otherwise affect the obligations of the Maker under this
Note to repay the principal balance outstanding and all accrued or accruing
interest.

    


    Section 8.  Waiver.  Maker
and each surety, endorser, guarantor, and other party now or subsequently liable
for payment of this Note, severally waive demand, presentment for payment,
notice of dishonor, protest, notice of protest, diligence in collecting or
bringing suit against any party liable on this Note, and further agree to any
and all extensions, renewals, modifications, partial payments, substitutions of
evidence of indebtedness, and the taking or release of any collateral with or
without notice before or after demand by the holder for payment under this
Note.

    


    Section 9.  Costs and
Attorneys’ Fees.  In the event the holder incurs costs in
collecting on this Note, this Note is placed in the hands of any attorney for
collection, suit is filed on this Note or if proceedings are had in bankruptcy,
receivership, reorganization, or other legal or judicial proceedings for the
collection of this Note, Maker and any guarantor jointly and severally agree to
pay on demand to the holder all expenses and costs of collection, including, but
not limited to, attorneys’ fees incurred in connection with any such collection,
suit, or proceeding, in addition to the principal and interest then
due.

    


    Section 10.  Time of
Essence.  Time is of the essence with respect to all of Maker’s
obligations and agreements under this Note.

    


    Section 11.  Jurisdiction and
Venue.  THIS NOTE SHALL BE GOVERNED BY THE LAWS OF THE STATE OF
TEXAS, AND MAKER CONSENTS TO JURISDICTION IN THE COURTS LOCATED IN DALLAS,
TEXAS.

    


    Section 12.  Notice.  Any
notice or demand required by this Note shall be deemed to have been given and
received on the earlier of (i) when the notice or demand
is actually received by the recipient or (ii) 72 hours after the notice
is deposited in the United States mail, certified or registered, with postage
prepaid, and addressed to the recipient.  The address for giving
notice or demand under this Note (i) to the holder shall be the
place of payment specified in Section 2 or such other
place as the holder may specify in writing to the Maker and (ii) to Maker shall be the
address below the Maker’s signature or such other place as the Maker may specify
in writing to the holder.

    


    Section 13.  Successors and
Assigns.  All of the covenants, obligations, promises and
agreements contained in this Note made by Maker shall be binding upon their
heirs, successors and permitted assigns, as
applicable.  Notwithstanding the foregoing, Maker shall not assign
this Note or its performance under this Note without the prior written consent
of the holder.

    


    Section 14.  Security.  The
obligations of the Maker under this Note are secured by all of the shares of
common stock in Whitney International University System Ltd. held by Maker
pursuant to the Pledge Agreement.

    


    Section 15.  Definitions.  For
purposes of this Note, the following terms shall have the following
meanings:

    


    (a)           “Contract
Rate” means the amount of any interest (including fees, charges or
expenses or any other amounts that, under applicable law, are deemed interest)
contracted for, charged or received by or for the account of Payee or the holder
of this Note.

    


    (b)           “Event of
Default” wherever used herein, means any one of the following
events:

    


    (i)           the
Maker fails to pay any amount due on this Note and/or any fees or sums due under
or in connection with this Note or the Pledge Agreement after any such payment
otherwise becomes due and payable and ten business days after demand for such
payment;

    


    (ii)           the
Maker otherwise fails to perform or observe any other provision contained in
this Note or the Pledge Agreement and such breach or failure to perform shall
continue for a period of thirty days after notice thereof shall have been given
to the Maker by the holder hereof;

    


    (iii)           a
case shall be commenced against either Maker, or either Maker shall file a
petition commencing a case, under any provision of the Federal Bankruptcy Code
of 1978, as amended, or shall seek relief under any provision of any other
bankruptcy, reorganization, arrangement, insolvency, readjustment of debt,
dissolution or liquidation law or any jurisdiction, whether now or hereafter in
effect, or shall consent to the filing of any petition against it under such
law, or either Maker shall make an assignment for the benefit of his or its
creditors, or shall admit in writing his or its inability to pay his or its
debts generally as they become due, or shall consent to the appointment of a
receiver, trustee or liquidator of either of Maker, or all or any part of his or
its property; or

    


    (iv)           an
event occurs that, with notice or lapse of time, or both, would become any of
the foregoing Events of Default.

    


    (c)           “Maximum
Rate” shall mean the highest lawful rate permissible under applicable law
for the use, forbearance or detention of money.

    


    (d)           “Pledge
Agreement” shall mean the Pledge Agreement of even
date herewith among the Maker and Payee.

    


    (e)           “Prime
Rate” shall mean the fluctuating interest rate
per annum in effect from time to time equal to the base rate on corporate loans
as reported as the Prime Rate in the Money Rates column of The Wall Street
Journal.

    


    


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Intentionally Left Blank]

    



    
      
         


      

      
         


        
          

        

      

      
         


      

    


    


    
      	
               
      

            	
              MAKER:

            


    

    


    
      	
               
      

            	
              Contran
      Corporation

            


    

    


    


    


    
      	
               
      

            	
              By:

            	
              /s/ William J.
      Lindquist

            	 


    

    
      	
               
      

            	
              William
      J. Lindquist, Senior Vice President

            


    

    


    


    Address:  Three
Lincoln Centre

    5430 LBJ
Freeway, Suite 1700

    Dallas,
Texas 75240-2697

    


    


    


    
      	
               
      

            	
              PAYEE:

            


    

    


    
      	
               
      

            	
              Titanium
      Metals Corporation

            


    

    


    


    


    
      	
               
      

            	
              By:

            	
              /s/ Robert D.
      Graham

            	 


    

    
      	
               
      

            	
              Robert
      D. Graham, Executive Vice President

            


    

    


    Address:  Three
Lincoln Centre

    5430 LBJ
Freeway, Suite 1700

    Dallas,
Texas 75240-2697