Exhibit 10.5
Case No. FF-G-017A
SECURITY
AGREEMENT
This Security Agreement
(hereinafter, the “Agreement”), made between Omega
Protein, Inc., (hereinafter, the “Borrower”), whose
address is 2101 City West Blvd., Building 3, Suite 500, Houston,
Texas 77042 and the UNITED STATES OF AMERICA, acting by and through
the Secretary of Commerce, National Oceanic and Atmospheric
Administration, National Marine Fisheries Service, Financial
Services Division, 1315 East-West Highway, Silver Spring, Maryland
20910, which is the Secured Party, (hereinafter the
“Government”).
All terms contained herein are
defined in the Acknowledgment of Definitions executed by all
parties to this transaction.
W
I T N
E S S E T
H
WHEREAS, the Borrower desires to
enter into a Promissory Note to the United States (hereinafter, the
“Note”), dated March 7, 2007 , in the amount of
SIX MILLION, THREE HUNDRED FORTY-NINE THOUSAND and No/100 Dollars
($6,349,000.00), pursuant to the provisions of Title XI of the
Merchant Marine Act, 1936, as amended, found at 46 USC § 1271
et seq., and 50 CFR 253, as amended by Public Law 104-297 on
October 11, 1996, known as the Fisheries Finance Program,
(hereinafter, the “FFP Debt”); and
WHEREAS, the Government will not
enter into this transaction unless the Government is granted a
security interest in certain property.
NOW THEREFORE, in consideration of
the premises and other good and valuable consideration, the receipt
whereof being hereby acknowledged, the parties agree as
follows:
Section 1
. The Borrower hereby grants to the
Government a security interest in the following described property,
together with all accessories, substitutions, additions,
replacements, parts and accessions affixed to or used in connection
therewith (hereinafter, the “Collateral”):
(a) The whole of the fishing vessel
SEA BEE, Official Number 549886, together with all related gear,
boilers, machinery, electronics, equipment, motors, skiffs,
inventory, supplies, contracts, contract rights, charter hire,
freight, licenses and/or permits, general intangibles, transferable
fishery conservation and management allocations, now owned or
hereafter acquired, attached or not attached or to be attached, to
secure payment of the Borrower’s debt to the Government as
evidenced hereby and by Borrower’s Note to
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the Government of even date herewith payable to
the Government, in accordance with the Note, in the amount of SIX
MILLION, THREE HUNDRED FORTY-NINE THOUSAND and no/Dollars,
($6,349,000.00) payable on the terms, at the times, and with
interest as set forth in said Note. Borrower agrees to pay the Note
and, if any portion thereof, principal or interest, is not paid
when due, Borrower agrees to pay, in addition to the foregoing, the
reasonable collection costs of the Government;
(b) Any and all federal or state
fisheries permits, individual fishing quotas (IFQ), individual
transferable quotas (ITQ), community development quotas (CDQ),
quota shares, allocations, endorsements, rights, licenses, or tags,
whether vested individually with the Borrower or appurtenant to the
Vessels, whether now owned or hereafter acquired, whether now
existing or hereafter created by rule, regulation, statute or
fishery management council action, which now exist or are hereafter
created pursuant to any limited entry programs, moratorium periods,
high seas permits, license limitation programs or total allowable
catch and domestic annual processing assessments or like programs
or assessments whether or not any of the foregoing relate to or
affect the fishing operations of the vessels.
(c) All insurances pertaining to the
Collateral, including, without limitation, hull and machinery,
increased value, war risk, protection and indemnity, pollution,
worker’s liability and compensation, loss of earnings,
personal property, liability and all other insurances and
association entries, and all claims and all returns of premiums,
dues, calls, and assessments that are not immediately applied to
future premiums, dues, calls, and assessments, and all other sums
or claims for sums due or to become due thereunder;
(d) All debts and obligations owing
to the Borrower, including, without limitation, interest thereon,
charges and other expenses and fees advanced by or incurred by or
for the Government, and all liens and encumbrances securing any or
all of the foregoing;
(e) Borrower grants the Government a
security interest in the following real estate situated in Jackson
County, State of Mississippi, fully described in Exhibit A and real
estate situated in Vermillion Parish, Louisiana, fully described in
Exhibit B.
EXHIBIT “A” and
“B” ARE ATTACHED AND MADE A PART HEREOF
together with all buildings and
other improvements, hereditaments and appurtenances thereunto
belonging, or in any wise appertaining now existing or hereafter
erected upon the premises and all the income and rents arising
therefrom. Borrower does hereby intend to convey and does convey
all of Borrower’s right, title and interest in and to any
strips and gores Borrower may now own contiguous to the above
described property;
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(f) It is expressly understood and
agreed, as a part of the consideration for the loan made to the
Borrower and secured by the premises described in Exhibit A and B,
this instrument covers and includes all surface, subsurface and/or
mineral estate ownership now or after acquired by the undersigned
in the above property and whether or not expressly excepted from
the description to the above security premises, any provisions
herein to the contrary being of no force and effect;
(g) For the consideration aforesaid,
and as further security for any and all debt(s) and obligation(s)
described above, said Borrower does hereby assign, pledge and
transfer to the Government, and grant to the Government a security
interest in and to the following described property and interests
which are listed on Exhibit B and/or set out as follows:
(1) all timber of all kind, character and description planted
and/or growing, or to be planted and/or grown, on the hereinabove
described property; (2) all crop allotments, quotas, and/or
(3) all rents, profits, issues, income, royalties, bonuses,
and revenue of said property, or any part or interest herein, from
time to time accruing whether under leases or tenancies now
existing or hereafter created; (4) each and every policy of
hazard insurance, or the like, now or hereafter in effect which
insures said property or any building, fixture and/or improvement
thereon, or any part thereof, together with all the right, title
and interest of Borrower in and to such policy, including but not
limited to any premiums paid (or rights to return premiums) and/or
all proceeds or payments thereunder; (5) all judgments, award
of damages and settlements hereafter made resulting from
condemnation proceedings or the taking of the real property, or any
part thereof, under the power of eminent domain, or for any damage
(whether caused by such taking or otherwise) to the property, or
any part thereof, or to any rights appurtenant thereto;
(6) all building materials, equipment, fixtures and fittings
of all kind, character, and description used in connection with or
relating to said property and/or buildings, fixtures or
improvements thereon; (7) all equipment, including, but not
limited to: forklifts, bobcats, cranes, pallet trucks, lift trucks
and other product or material movement equipment of whatsoever
nature; all trailers, tanks, trucks or other rolling stock of
whatsoever nature; all fish unloading, transfer and conveying
equipment of whatsoever nature; fungible goods, including fish; all
fish processing equipment of whatsoever nature; all fish weighing
equipment of whatsoever nature; all cooling, refrigerating,
freezing and other fish holding equipment (blast freezers, coolers,
or other refrigeration equipment) of whatsoever nature; all fish
packaging equipment of whatsoever nature; all fish baskets, totes,
tanks, tubs and other fish holding equipment of whatsoever nature;
all ice makers of whatsoever nature, all hand and power tools of
whatsoever nature; all office equipment of whatsoever nature; all
fish hatching, releasing, rearing, growing, tending and other
equipment of whatsoever nature in any way associated with fisheries
cultivation of every sort—all together with all
associated
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equipment, machinery, parts, tools, or other
items of whatsoever nature and whether fixed or unfixed to the
property or any other premises whatsoever; and/or (8) all
tangible or intangible property found on the premises which is not
listed on Exhibit “B”, and products, proceeds, and
additions and/or replacements of any or all of the property
described above in Items 1 through 7, also including all
after-acquired personal property to be located in or about the said
facility of Borrower, subject to any purchase-money security
interest acquired by any vendor of said after-acquired personal
property;
EXHIBIT “C” IS ATTACHED
AND MADE A PART HEREOF
Section 2
. The Borrower hereby warrants and
covenants that:
(a) Except as may otherwise be
required in the ordinary course of busine
