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EXHIBIT 4.12
[GRAPHIC]
BUSINESS LOAN
GENERAL SECURITY AGREEMENT
TO: CREDIT UNION CENTRAL OF ONTARIO LIMITED and SO-USE CREDIT
UNION LIMITED (collectively hereinafter called "Central")
I/WE STRIKER PAPER CANADA, INC. (hereinafter called the "Assignor")
hereby assign and transfer to Central, as a general and continuing collateral
security for payment of all existing and future indebtedness and liability of
the Assignor to Central wheresoever and howsoever incurred and any ultimate
unpaid balance thereof, all property of the kinds described in paragraph 2 below
of which the Assignor is now or may hereafter become the owner.
1. DEFINITIONS
In this Agreement,
(a) "PPSA" means the Personal Property Security Act (Ontario), and any Act
that may be substituted therefor, as from time to time amended.
(b) "Receivables" means all debts, accounts, claims, moneys and choses in
action now due or hereafter to become due or owing to the Assignor, or
any one or more of them.
(c) "Inventory" means all goods now or hereafter forming part of the
inventory of the Assignor or any one or more of them, including,
without limiting the generality of the foregoing, goods held for sale
or lease; goods furnished or to be furnished under contracts of
service; goods which are raw materials or work in process; goods used
in or procured for packing; materials used or consumed in the business
of the Assignor; emblements; growing crops that become such within one
year after the execution of this Agreement; timber to be cut; oil, gas
and other minerals to be extracted; and goods described in paragraph 9
below.
(d) "Equipment" means all goods, exclusive of inventory or consumer goods,
now or hereafter owned by the Assignor or any one or more of them,
which are used or are intended for use in or about the business
conducted by the Assignor or in the places referred to in paragraph 8
and including, without limiting the generality of the foregoing,
machinery; fixtures; furniture; plant; vehicles of any sort or
description; the property described in paragraph 10 below; and all
accessories installed in or affixed, attached or appertaining to any of
the foregoing.
(e) "Documents of Title" shall have the meaning ascribed to it in the PPSA
and shall include, without limiting the generality of the foregoing,
all warehouse receipts and bills of lading whether negotiable or not.
(f) "Chattel Paper", "goods" and "instrument" shall have the meanings
respectively ascribed to them in the PPSA.
2. SECURITY INTEREST
As security for the payment and performance of all existing and future
liabilities and indebtedness of the Assignor, or any one or more of them,
to Central, howsoever arising, the Assignor hereby grants to Central a
continuing security interest in the business undertaking of the Assignor
and in all property of the following kinds now owned or hereafter acquired
by the Assignor or by any one or more of them:
(a) Inventory;
(b) Equipment;
(c) Receivables;
(d) Chattel Paper;
(e) Documents of Title;
(f) All books and papers recording, evidencing or relating to the
Receivables, Chattel Paper or Documents of Title, and all securities,
bills, notes, instruments or other documents now or hereafter held by
or on behalf of the Assignor or any one or more of them with respect to
the said Receivables, Chattel Paper or Documents of Title;
(g) All shares, stock, warrants, bonds, debentures, debenture stock or
other securities including, without limiting the generality of the
foregoing, the securities listed in paragraph 11 hereof, together with
renewals thereof, substitutions therefor, accretions thereto and all
rights and claims in respect thereof
(h) All proceeds and products of any or all of the foregoing, including any
compensation of Collateral damages, expropriated, stolen or destroyed.
The above named property, whether now owned or hereafter acquired,
shall hereinafter be called the "Collateral".
3. WARRANTIES AND COVENANTS
(a) Except for the security interest granted hereby and as disclosed in the
Personal Property Registry and/or permitted in the Commercial Demand
Line of Credit Agreement or the Inter-Creditor Agreement, the Assignor
or any one or more of them is (and as to collateral to be acquired
after the date hereby, shall be) the owner of the Collateral free and
clear of all liens, charges, claims, encumbrances, taxes or
assessments.
(b) The Assignor will not sell, offer to sell, transfer, pledge or mortgage
the Collateral, nor will the Assignor suffer to exist any other
security interest in the Collateral in favour of any person other than
Central and the holders of security interests disclosed or permitted as
aforesaid, without the prior written consent of Central. All proceeds
of sales shall be received as trustee for Central and shall be
forthwith paid over to Central.
(c) The Assignor shall, during the currency of this Agreement, insure and
keep insured the Collateral to its full insurable value for fire, theft
and such other risks as Central may reasonably require, and will, at
the request of Central, pay such further premium as is necessary to
obtain an endorsement that the security interest of Central will not be
invalidated by any breach of statutory condition. The proceeds in any
insurance held pursuant to this paragraph shall be payable to Central
as its interest may appear and any proceeds of such insurance shall, at
the option of Central, be applied to the replacement of the Collateral
or towards repayment of any indebtedness of the Assignor or any one or
more of them to Central. Should the Assignor neglect to maintain such
insurance Central may insure, and any premiums paid by Central together
with interest thereon shall be payable by the Assignor to Central as
its interest may appear, upon demand. The Assignor will deposit a
certified copy of such insurance with Central on request, or obtain an
insurance endorsement in favour of Central.
(d) The Assignor shall provide from time to time upon request from Central,
written information relating to the Collateral or any part thereof, and
Central shall be entitled from time to time to inspect the tangible
Collateral including, without limitation, the books and records
referred to in paragraph 2(f) above wherever located. For such purpose
Central shall have access at all reasonable times during normal
business hours upon reasonable advance notice to all places where the
Collateral or any part thereof is located, and to all premises occupied
by the Assignor.
4. EVENTS OF DEFAULT
Any or all of the liabilities or indebtedness of the Assignor or any one or
more of them to Central shall, at the option of Central and notwithstanding
any time or credit allowed by any instrument evidencing a liability, be
immediately due and payable without notice or demand upon the occurrence of
any of the following events, subject to a cure period of 7 days from the
date of the event (hereinafter referred to as "Event(s) of Default"):
(a) Default in the payment or performance when due or payable of any
liability of the Assignor or any one or more of them, or of any
endorser, guarantor or surety for any liability of the Assignor or any
one or more of them to Central;
(b) Default by the Assignor of any obligation or covenant contained herein;
(c) Proof that any warranty, representation or statement made by the
Assignor or furnished to Central herein, or in the application for any
loan, was false in any material respect when made or furnished;
(d) Any loss, theft, damage or destruction of Collateral or of any part of
it in excess of $100,000, or the making of any levy, seizure or
attachment thereto or the appointment of a receiver of any part thereof
if unstayed for 15 days;
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(f) The death, dissolution, termination of existence, insolvency, business
failure, or commencement of any proceedings under the Bankruptcy Act
affecting the Assignor or any one or more of them.
5. REMEDIES
Upon any Event of Default and at any time thereafter Central, at its
option, may declare that all indebtedness and obligations secured by this
Agreement shall immediately become due and payable, and:
(a) Central shall then have all rights and remedies of a secured party
under the PPSA.
(b) Central shall then be constituted to appoint in writing any person to
be a receiver (which term shall include a receiver and manager) of the
Collateral, including any rents and profits thereof, and may remove any
receiver and appoint another in its stead. Such receiver so appointed
shall have power to take possession of the Collateral and to carry on
or concur in carrying on the business of the Assignor, and to sell or
concur in selling the Collateral or any part thereof. Any such receiver
shall for all purposes to be deemed to be the agent of the Assignor.
Central may from time to time fix the renumeration of such receiver.
All moneys from time to time received by such receiver shall be paid by
him first in discharge of all rents, taxes, rates, insurance premiums
and outgoings affecting the Collateral, secondly in payment of his
renumeration as receiver, thirdly in keeping in good standing any liens
and charges on the Collateral prior to the security constituted by this
Agreement, and fourthly in or toward payment of such parts of the
indebtedness and liability of the Assignor to Central as to Central
seems best, and any residue of such moneys so received shall be paid to
the Assignor. Central in appointing or refraining from appointing such
receiver shall not incur any liability to the receiver, the Assignor or
otherwise.
(c) Central may then collect, realize, sell or otherwise deal with the
Receivables or any part thereof in such manner, upon such terms and
conditions at such time or times, and without notice to the Assignor,
as may seem to it advisable. Central shall not be liable or accountable
for any failure to collect, realize, sell or obtain payment of the
Receivables or any part thereof, and shall not be bound to institute
proceedings for the purpose of collecting, realizing, or obtaining
payment of the same for the purpose of preserving any rights of
Central, the Assignor or any other person, firm or corporation in
respect of the same. All moneys collected or received by the Assignor
in respect of the Receivables shall be received as trustee for Central
and shall be forthwith paid over to Central. All moneys collected or
received by Central in respect of the Receivables or other Collateral
may be applied on account of such parts of the indebtedness and
liability of the Assignor as to Central seems best, or in the
discretion of Central, may be released to the Assignor, all without
prejudice to the liability of the Assignor or Central's right to hold
and realize this security.
6. CHARGES AND EXPENSES
Central may charge on its own behalf and pay to others reasonable sums for
expenses incurred and for services rendered (expressly including legal
advice and services) in or in connection with realizing, disposing of,
retaining or collecting the Collateral or any part thereof. Such sums shall
be a first charge on the proceeds of realization, disposition or
collection. Central may at its option pay taxes, discharge any encumbrance
or charge claimed (whether validly or not) against the Collateral any pay
any amount which, in Central's sole discretion, it may consider requisite
to secure possession of the Collateral with or without litigation or
compromise. Central may settle any litigation in respect of the Collateral
or the possession thereof, and may pay for insurance, repairs and
maintenance to the Collateral, and any sum so paid by Central shall
constitute indebtedness of the Assignor secured hereunder which the
Assignor shall repay on demand.
7. POSSESSION OF COLLATERAL
Until default, the Assignor may have possession of the Collateral and enjoy
the same subject to the terms hereof. However, whether or not default has
occurred, Central may at any time request that debtors on the Receivables
be notified of Central's security interest. Until such notification is
made, the Assignor shall continue to collect Receivables but shall hold the
proceeds received from collection in trust for Central without commingling
the same with other funds, and shall turn the same over to Central
immediately upon receipt in the identical form received.
8. LOCATION OF COLLATERAL
Except for any property described in paragraph 11 hereof, the Collateral,
insofar as it consists of tangible property, is now and will hereafter be
kept at the place or places, listed below. None of the Collateral shall be
removed from such place or places without the written consent of Central.
000 Xxxxxx Xxxxxx Xxxxx, Xxxxxxx, Xxxxxxx
9. SUPPLEMENTARY DESCRIPTION OF INVENTORY
10. SUPPLEMENTARY DESCRIPTION OF EQUIPMENT
11. SUPPLEMENTARY DESCRIPTION OF SECURITIES
12. GENERAL
(a) This Agreement shall be a continuing agreement in every respect.
(b) This Agreement shall be governed by and construed in accordance with
the laws of the Province of Ontario.
(c) The Assignor may terminate this Agreement by delivering written notice
to Central at any time when the Assignor, or each of them, is not
indebted or liable to Central. No remedy for the enforcement or the
rights of Central hereunder shall be exclusive or dependent on any
other such remedy and any one or more of such remedies may from time to
time be exercised independently or in combination. The security
interest created or provided for by this Agreement is intended to
attach when this Agreement is signed by the Assignor and delivered to
Central. For greater certainty it is declared that any and all future
loans, advances or other value which Central may in its discretion make
or extend to or for the account of the Assignor or of any one or more
of them shall be secured by this Agreement. If more than one person
executes this Agreement their obligations hereunder shall be joint and
several.
(d) In construing the Agreement, the word "Assignor" and the personal
pronouns "he" or "his" and any verb relating thereto shall be read and
construed as the number and gender of the parties signing this
Agreement may require.
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(e) Central may grant extensions of time and other indulgences, take and
give up securities, accept compositions, grant releases and discharges
and otherwise deal with the Assignor, debtors of the Assignor, sureties
and others, and with the Collateral and other securities, as Central
may see fit and without prejudice to the liability of the Assignor or
Central's right to hold and realize this security.
Signed, Sealed and Delivered this 20th day of March, 1998 at Xxxxxxx, Xxxxxxx.
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Middle Date of birth Gender
Initial dd/mm/yy M/F
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Witness Signature of Assignor
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Witness Signature of Assignor
To be completed
by
incorporated
business
Corporation and/or Trade Name of Assignor STRIKER PAPER CANADA, INC.
Per:
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Name: Xxxxxxx Xxxx
Title: Chief Financial Officer
I have the authority to bind the corporation
May 19, 1998
To be completed by sole
proprietor or partners
