Exhibit 99.3
SECURITY AGREEMENT
EQUIPMENT, FIXTURES, INVENTORY AND RECEIVABLES
X. X. Xxxxx Corporation, 00000 Xxxxxxxx Xxxx, X. X., Xxxxxxxxxxxx,
Xxxxxxxxx Xxxxxx, Xxxx, 00000, a corporation organized under the law of the
State of Ohio (hereinafter called "Debtor"), for valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, hereby grants, pledges
and assigns to The Huntington National Bank, as collateral agent for The
Huntington National Bank and Metropolitan Life Insurance Company (in that
capacity hereinafter referred to as "Agent"), a security interest in the
following property, whether Debtor's interest therein as owner, co-owner,
lessee, consignee, secured party or otherwise be now owned or existing, or
hereafter arising or acquired, and wherever located, together with all
substitutions, replacements, additions and accessions therefor or thereto, all
replacement and repair parts therefor:
(a) All of Debtor's present and future (i) equipment, including without
limitation, machinery, equipment, tools, furniture, furnishings and fixtures
including, but not limited to, all manufacturing, fabricating, distribution,
selling, processing, transporting, office and packaging equipment, molds, dies,
appliances, vehicles, vessels, aircraft, aircraft engines, trade fixtures,
assembly systems, power systems, heating, cooling and ventilating systems,
lighting and communication systems, electric, gas and water distribution
systems, food service systems, fire prevention, alarm and security systems,
laundry systems, computing and data processing systems, (ii) other tangible
personal property (other than Inventory), and (iii) any and all parts and
appurtenances attached to any of the foregoing or used in connection therewith
(hereinafter sometimes called the "Equipment"), some or all of which Equipment
may be more fully described in the schedule set forth at the end of this
agreement or in a separate schedule attached hereto;
(b) All of Debtor's present and future goods and inventory, goods in
transit, raw materials, work in process, finished goods, supplies, and all
materials used or consumed in Debtor's business, wherever located and, including
without limitation, all right, title and interest in any property the sale or
other disposition of which has given rise to Receivables and which has been
returned to or repossessed or stopped in transit by the Borrower (the
"Inventory"), some or all of the Inventory which may be more fully described in
the schedule set forth at the end of this agreement or in a separate schedule
attached hereto;
(c) All of Debtor's present and future accounts, accounts receivable,
contract rights, guaranties of accounts, accounts receivable and contract rights
and security therefor, chattel paper, electronic chattel paper, payment
intangibles, healthcare insurance receivables, instruments, promissory notes,
supporting obligations and other forms of obligations and property securing
rights to payment, negotiable documents, drafts, acceptances and other forms of
obligations and receivables arising from or in connection with the operation of
Debtor's business including, but not limited to, any of the foregoing arising
from or in connection with Debtor's sale, lease or other disposition of
Inventory, deposit accounts, and all books, records, ledger cards, computer
programs and other
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documents or property at any time evidencing or relating to the foregoing
receivables (hereinafter sometimes called the "Receivables");
(d) All of Debtor's present and future trade names, trademarks, trade
secrets, service marks, data bases, software and software systems, including the
source and object codes, information systems, discs, tapes, customer lists,
telephone numbers, credit memoranda, goodwill, patents, patent applications,
copyrights, royalties, literary rights, licenses, franchises and franchise
rights (hereinafter sometimes called the "Intellectual Property");
(e) All of Debtor's present and future general intangibles, payment
intangibles, income and other tax refunds, proceeds of insurance, eminent domain
and condemnation awards, choses in action, preference recoveries and all claims
in respect of transfers of any kind and all transfers by States and governmental
units of States (hereinafter sometimes called the "General Intangibles");
(f) All of Debtor's present and future interest in the following
commercial tort claims
NONE
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(hereinafter sometimes called the "Commercial Tort Claims");
(g) All of Debtor's present and future letters-of-credit and
letter-of-credit rights and proceeds of letters of credit (hereinafter sometimes
called the "Letter-of-Credit Interests");
(h) All of Debtor's present and future investment property, including
without limitation, securities, whether certificated or uncertificated,
securities entitlements, securities accounts, commodities contracts and
commodities accounts (hereinafter sometimes called the "Investment Property");
(i) All of Debtor's present and future deposit accounts, whether
general, special, time, demand, provisional, or final, all cash or monies
wherever located, any and all deposits or other sums at any time due to
Borrower, any and all policies or certificates of insurance, goods, cash and
property, which now or hereafter are at any time in the possession or control of
the Agent or in transit by mail or carrier to or from the Agent, or in the
possession of any third party acting in the Agent's behalf, without regard to
whether the Agent received the same in pledge for safekeeping, as agent for
collection or transmission or otherwise, or whether the Agent has conditionally
released the same (hereinafter sometimes called the "Deposit Accounts"); and
(j) All of Debtor's present and future cash and non-cash proceeds,
substitutions, replacements, additions and accessions to any Collateral, all
documents, negotiable documents, documents of title, warehouse receipts, storage
receipts, dock receipts, dock warrants, express bills, freight bills, airbills,
bills of lading, and other documents relating thereto, all products thereof,
including, but not limited to, notes, drafts, checks, instruments, insurance
proceeds, indemnity proceeds, warranty and guaranty proceeds, proceeds arising
in connection with any requisition,
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confiscation, condemnation, seizure or forfeiture of all or any part of the
Collateral (defined herein) by any governmental body, authority, bureau or
agency (or any person acting under color of governmental authority), whatever is
acquired upon the sale, lease, license, exchange or other disposition of any
Collateral, whatever is collected on, or distributed on account of, any
Collateral, any right arising out of any Collateral, any claim arising out of
the loss, nonconformity, or interference with the use of, defects or
infringement of rights in, or damage to any Collateral, and insurance payable by
reason of loss or nonconformity of, defects or infringement of rights in, or
damage to, any Collateral (hereinafter sometimes called the "Proceeds");
(the Receivables, the Inventory, the Equipment, the General Intangibles, the
Commercial Tort Claims, the Letter-of-Credit Interests the Intellectual
Property, the Investment Property, the Deposit Accounts, the Proceeds and all
property and interests in property now owned or hereafter acquired by Debtor in
or upon which a security interest, lien, deed of trust or mortgage is granted to
the Agent or its affiliates, whether under this agreement, any security
agreement, under any of the other collateral documents or under any of the other
loan documents are herein collectively termed the "Collateral"), whether
Debtor's interest therein be as owner, co-owner, lessee, consignee, secured
party or otherwise, and whether the same be now owned or existing or hereafter
arising or acquired, and wherever located.
Notwithstanding the foregoing, the Receivables, the General
Intangibles, the Intellectual Property and the Collateral, generally, shall not
include any right of Debtor under any contract, agreement or instrument pursuant
to which the grant of the security interest in this agreement is prohibited by
the terms thereof without the consent of another party thereto or would give any
such party the right to terminate its obligations thereunder, unless all
required consents have been obtained from such party.
The security interest hereby granted is to secure the prompt and full
payment and complete performance of the Obligations. The word "Obligations" is
used in its most comprehensive sense and includes (i) without limitation, all
present and future indebtedness, debts and liabilities (including principal,
interest, late charges, collection costs, attorneys' fees to the extent
permitted by law and the like) of Debtor to The Huntington National Bank either
created by Debtor alone or together with another or others, primary or
secondary, secured or unsecured, absolute or contingent, liquidated or
unliquidated, direct or indirect, whether evidenced by note, draft, application
for letter of credit or otherwise, and any and all renewals of or substitutes
therefor, including without limitation all indebtedness owed by Debtor to The
Huntington National Bank by reason of credit extended or to be extended to
Debtor in the principal amount of $32,000,000, pursuant to a Revolving Credit
Agreement dated as of December 27, 2002 (the "Bank Agreement"), and one or more
instruments of indebtedness and related loan documents executed in connection
therewith; and (ii) all indebtedness, debts and liabilities (including
principal, interest, late charges, collection costs, attorneys' fees to the
extent permitted by law and the like) of Debtor to Metropolitan Life Insurance
Company incurred by Debtor pursuant to a loan agreement and promissory note
dated July 5, 1994
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(the "Met Life Agreement"), under which there is outstanding on the date of this
security agreement the principal sum of $4,285,000.
It is Debtor's express intention that this agreement and the continuing
security interest granted hereby, in addition to covering all present
Obligations of Debtor to The Huntington National Bank and Metropolitan Life
Insurance Company, shall extend to all future Obligations of Debtor to The
Huntington National Bank, whether or not such Obligations are reduced or
entirely extinguished and thereafter increased or reincurred, whether or not
such Obligations are related to the indebtedness identified above by class, type
or kind and whether or not such Obligations are specifically contemplated by
Debtor, The Huntington National Bank and Metropolitan Life Insurance Company as
of the date hereof. The absence of any reference to this agreement in any
documents, instruments or agreements evidencing or relating to any Obligation
secured hereby shall not limit or be construed to limit the scope or
applicability of this agreement.
This security agreement is the subject of an intercreditor agreement by
and between The Huntington National Bank and Metropolitan Life Insurance Company
dated as of December 27, 2002, with respect to the agency and collateral-sharing
relationship between The Huntington National Bank and Metropolitan Life
Insurance Company. Debtor agrees that, should The Huntington National Bank at
any time agree to release the security interest granted to it under this
security agreement, Metropolitan Life Insurance Company shall have the right to
appoint a successor to replace The Huntington National Bank as collateral agent
with respect to the security interest granted herein.
1. GENERAL COVENANTS. Debtor represents, warrants and covenants as
follows:
(a) Except for such claims and interests, if any, shown in the
schedule set forth at the end of this agreement or in any schedule attached
hereto and signed by both Debtor and Agent and the security interest granted
hereby, (i) Debtor is, or as to Collateral arising or to be acquired after the
date hereof, shall be, the sole and exclusive owner of the Collateral, and the
Collateral is and shall remain free from any and all liens, security interests,
encumbrances, claims and interests; and (ii) no security agreement, financing
statement, equivalent security or lien instrument or continuation statement
covering any of the Collateral is on file or of record in any public office.
(b) Debtor shall not create, permit or suffer to exist, and
shall take such action as is necessary to remove, any claim to or interest in or
lien or encumbrance upon the Collateral, other than those, if any, shown in the
schedule set forth at the end of this agreement or in any schedule attached
hereto and signed by both Debtor and Agent and the security interest granted
hereby, and shall defend the right, title and interest of Agent in and to the
Collateral against all claims and demands of all persons and entities at any
time claiming the same or any interest therein.
(c) Debtor's principal place of business and chief executive
office/residence is located at the address set forth at the beginning of this
agreement; Debtor has no other place of
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business/residence, except as shown in the schedule set forth at the end of this
agreement or in any schedule attached hereto and signed by both Debtor and
Agent; and, unless Agent consents in writing to a change in the location of the
Equipment, Inventory or Debtor's records concerning the Receivables prior to
such a change in location, the Equipment, Inventory and Debtor's records
concerning the Receivables shall be kept at that address or at the locations set
forth in such schedules.
(d) At least thirty (30) days prior to the occurrence of any
of the following events, Debtor shall deliver to the loan officer who is
handling Debtor's Obligations on behalf of Agent written notice of such
impending events: (i) a change in Debtor's principal place of business, chief
executive office and/or residence; (ii) the opening or closing of any place of
business; (iii) a change in Debtor's name, identity or corporate structure; or
(iv) a change in Debtor's state of incorporation or formation.
(e) Subject to any limitation stated therein or in connection
therewith, all information furnished by Debtor concerning the Collateral or
otherwise in connection with the Obligations, is or shall be at the time the
same is furnished, accurate, correct and complete in all material respects.
(f) The Collateral is and shall be used primarily for business
purposes.
2. COLLECTION OF ACCOUNTS. Debtor shall, unless otherwise directed by
Agent following the occurrence and during the continuation of an Event of
Default under either of the Bank Agreement or the Met Life Agreement (as "Event
of Default" is defined in those respective agreements), collect all of Debtor's
Receivables. With respect to any Receivables collected by the Agent, Debtor
authorizes Agent to indorse the name of Debtor upon any checks or other items
received in payment of any Receivable and to do any and all things necessary in
order to reduce the same to money. All amounts received by Agent representing
payment of Receivables may be applied by Agent to the payment of the Obligations
in such order of preference as Agent may determine, or Agent may, at its option,
impound all or any portion of such amounts and retain said amounts as security
for the payment of the Obligations, with the right on the part of Debtor, upon
approval by Agent, to obtain the release of all or part of such impounded
amounts. Agent may, however, at any time, apply all or any part of such
impounded amounts as aforesaid. If so directed by Agent following the occurrence
and during the continuation of an Event of Default under either of the Bank
Agreement or the Met Life Agreement, Debtor shall hold all payments of any
Receivable in trust for Agent and shall forthwith deliver the same to Agent in
the form received by Debtor without commingling with any funds of Debtor. Debtor
also authorizes Agent at any time following the occurrence and during the
continuation of an Event of Default under either of the Bank Agreement or the
Met Life Agreement, without notice, to appropriate and apply any balances,
credits, property, deposits, accounts or money of or owing to Debtor in Agent's
possession, custody or control to the payment of any of the Obligations.
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Debtor agrees to execute, deliver, file and record all such notices,
affidavits, assignments, financing statements and other instruments as shall in
the reasonable judgment of Agent be necessary or desirable to evidence, validate
and perfect the security interest of Agent in the Receivables. Following the
occurrence and during the continuation of an Event of Default under either of
the Bank Agreement or the Met Life Agreement, Agent shall have the right to
notify any persons or entities owing any Receivables and to demand and receive
payment, but Agent shall have no duty so to do. Upon request of Agent following
the occurrence and during the continuation of an Event of Default under either
of the Bank Agreement or the Met Life Agreement, Debtor shall notify such
account debtors and shall indicate on all invoices to such account debtors that
the accounts are payable to Agent.
3. INSURANCE. Debtor shall have and maintain insurance at all times
with respect to all Equipment and Inventory (i) insuring against risks of fire
(including so-called extended coverage), explosion, theft, sprinkler leakage and
such other casualties as Agent may designate, and (ii) insuring against
liability for personal injury and property damage relating to the Equipment and
Inventory, containing such terms, in such form, for such periods and written by
such companies as may be satisfactory to Agent, such insurance to be payable to
Agent and Debtor as their interests may appear. All policies of insurance shall
provide for twenty (20) days' written minimum cancellation notice to Agent and,
at request of Agent, shall be delivered to and held by Agent. Following the
occurrence and during the continuation of an Event of Default under either of
the Bank Agreement or the Met Life Agreement, Agent may act as attorney for
Debtor in obtaining, adjusting, settling and canceling such insurance and
indorsing any drafts. In the event of failure to provide insurance as herein
provided, Agent may, at its option, provide such insurance and Debtor shall pay
to Agent, upon demand, the cost thereof. Should Debtor fail to pay said sum to
Agent upon demand, interest shall accrue thereon, from the date of demand until
paid in full, at the highest rate set forth in any document or instrument
evidencing any of the Obligations.
4. INSPECTION. Debtor shall at all times keep accurate and complete
records of the Receivables, Deposit Accounts, Letter-of-Credit Interests,
General Intangibles and Intellectual Property, and Debtor shall, at all
reasonable times and from time to time, allow Agent, by or through any of its
officers, agents, attorneys or accountants, to examine, inspect and make
extracts from Debtor's books and records and to arrange for verification of the
Receivables directly with account debtors or by other methods and to examine and
inspect the Collateral wherever located.
5. FURTHER ASSURANCES. Debtor shall perform, do, make, execute and
deliver all such additional and further acts, things, deeds, assurances and
instruments as Agent may reasonably require to more completely vest in and
assure to Agent its rights hereunder and in or to the Collateral.
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6. PRESERVATION AND DISPOSITION OF COLLATERAL.
(a) Debtor shall advise Agent promptly, in writing and in
reasonable detail, (i) of any material encumbrance upon or claim asserted
against any of the Collateral; (ii) of any material change in the composition of
the Collateral; and (iii) of the occurrence of any other event that would have a
material effect upon the aggregate value of the Collateral or upon the security
interest of Agent.
(b) Debtor shall not sell or otherwise dispose of the
Collateral; provided, however, that until default, Debtor may use the Equipment
and Inventory in any lawful manner not inconsistent with this agreement or any
agreement concerning any of the Obligations or with the terms or conditions of
any policy of insurance thereon, may sell or otherwise dispose of the Inventory
in the ordinary course of Debtor's business and may sell or otherwise dispose of
obsolete Equipment in the ordinary course of business, in each case in a manner
not inconsistent with this security agreement or any other agreement concerning
any of the Obligations. A disposition in the ordinary course of business shall
not include a transfer in partial or total satisfaction of a debt.
(c) Debtor shall keep the Collateral in good condition and
shall not misuse, abuse, secrete, waste or destroy any of the same.
(d) Debtor shall not use the Collateral in violation of any
statute, ordinance, regulation, rule, decree or order.
(e) Debtor shall pay promptly when due all taxes, assessments,
charges or levies upon the Collateral or in respect to the income or profits
therefrom, except that no such charge need be paid if (i) the validity thereof
is being contested in good faith by appropriate proceedings; (ii) such
proceedings do not involve any danger of sale, forfeiture or loss of any
Collateral or any interest therein; and (iii) such charge is adequately reserved
against in accordance with generally accepted accounting principles.
(f) At its option following the occurrence and during the
continuation of either an Event of Default under the Bank Agreement or the Met
Life Agreement or an event that would become an Event of Default with the giving
of notice or passage of time, or both, Agent may discharge taxes, liens,
security interests or other encumbrances at any time levied or placed on the
Collateral and may pay for the maintenance and preservation of the Collateral.
Debtor agrees to reimburse Agent upon demand for any payment made or any expense
incurred (including reasonable attorneys' fees to the extent permitted by law)
by Agent pursuant to the foregoing authorization. Should Debtor fail to pay said
sum to Agent upon demand, interest shall accrue thereon, from the date of demand
until paid in full, at the highest rate set forth in any document or instrument
evidencing any of the Obligations.
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(g) Upon Agent's reasonable request at any time or times, and
in furtherance of the agreements made herein, Debtor shall assign and deliver to
Agent any Collateral and shall furnish to Agent additional personal property
collateral of value and character satisfactory to Agent as security for the
Obligations.
7. EXTENSIONS AND COMPROMISES. With respect to any Collateral held by
Agent as security for the Obligations, Debtor assents to all extensions or
postponements of the time of payment thereof or any other indulgence in
connection therewith, to each substitution, exchange or release of Collateral,
to the addition or release of any party primarily or secondarily liable, to the
acceptance of partial payments thereon and to the settlement, compromise or
adjustment thereof, all in such manner and at such time or times as Agent may
deem advisable. Agent shall have no duty as to the collection or protection of
Collateral or any income therefrom, nor as to the preservation of rights against
prior parties, nor as to the preservation of any right pertaining thereto,
beyond the safe custody of Collateral in the possession of Agent.
8. FINANCING STATEMENTS. The Debtor hereby authorizes the Agent to
file financing statements describing the Collateral, and any necessary future
amendments thereto, in any and all public offices in which the Agent deems such
filing to be necessary or desirable. In addition, at the request of Agent,
Debtor shall join with Agent in executing one or more financing statements in a
form satisfactory to Agent and shall pay the cost of filing the same in all
public offices wherever filing is deemed by Agent to be necessary or desirable.
9. AGENT'S APPOINTMENT AS ATTORNEY-IN-FACT. Debtor hereby irrevocably
constitutes and appoints Agent and any officer or agent thereof, with full power
of substitution, as Debtor's true and lawful attorney-in-fact with full
irrevocable power and authority in the place and stead of Debtor and in the name
of Debtor or in Agent's own name, from time to time in Agent's discretion, for
the purpose of carrying out the terms of this agreement, to take any and all
appropriate action and to execute any and all documents and instruments that may
be necessary or desirable to accomplish the purposes of this agreement and,
without limiting the generality of the foregoing, hereby grants to Agent the
power and right, on behalf of Debtor, without notice to or assent by Debtor:
(a) To execute, file and record all such financing statements,
certificates of title and other certificates of registration and operation and
similar documents and instruments including, but not limited to, those relating
to aircraft or marine vessels, as Agent may deem necessary or desirable to
protect, perfect and validate Agent's security interest.
(b) Upon the occurrence and continuance of any event of
default under paragraph 10 hereof or any breach of any term, condition or
provision of this agreement, (i) to sign and indorse any invoices, freight or
express bills, bills of lading, storage or warehouse receipts, drafts against
account debtors, assignments, verifications and notices in connection with
accounts and other documents relating to the Collateral; (ii) to commence and
prosecute any suits, actions or proceedings at law or in equity in any court of
competent jurisdiction to collect the Collateral or any
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part thereof and to enforce any other right in respect of any Collateral; (iii)
to defend any suit, action or proceeding brought against Debtor with respect to
any Collateral; (iv) to settle, compromise or adjust any suit, action or
proceeding described above and, in connection therewith, to give such discharges
or releases as Agent may deem appropriate; and (v) generally, to sell, transfer,
pledge, make any agreement with respect to or otherwise deal with any of the
Collateral as fully and completely as though Agent were the absolute owner
thereof for all purposes, and to do, at Agent's option and Debtor's expense, at
any time or from time to time, all acts and things which Agent deems necessary
to protect, preserve or realize upon the Collateral and Agent's security
interest therein, in order to effect the intent of this agreement, all as fully
and effectively as Debtor might do.
Debtor hereby ratifies all that said attorneys shall lawfully do or
cause to be done by virtue hereof. This power of attorney is a power coupled
with an interest and shall be irrevocable.
The powers conferred upon Agent hereunder are solely to protect its
interests in the Collateral and shall not impose any duty upon Agent to exercise
any such powers. Agent shall be accountable only for amounts that Agent actually
receives as a result of the exercise of such powers and neither Agent nor any of
its officers, directors, employees or agents shall be responsible to Debtor for
any act or failure to act, except for Agent's own gross negligence or willful
misconduct.
10. DEFAULT. Upon the occurrence and during the continuation of an
Event of Default under either of the Bank Agreement or the Met Life Agreement:
(a) Agent may, at its option and without notice, declare the
unpaid balance of any or all of the Obligations immediately due and payable and
this agreement and any or all of the Obligations in default.
(b) All payments received by Debtor under or in connection
with any of the Collateral shall be held by Debtor in trust for Agent, shall be
segregated from other funds of Debtor and shall forthwith upon receipt by Debtor
be turned over to Agent in the same form as received by Debtor (duly indorsed by
Debtor to Agent, if required). Any and all such payments so received by Agent
(whether from Debtor or otherwise) may, in the sole discretion of Agent, be held
by Agent as collateral security for, and/or then or at any time thereafter be
applied in whole or in part by Agent against, all or any part of the Obligations
in such order as Agent may elect. Any balance of such payments held by Agent and
remaining after payment in full of all the Obligations shall be paid over to
Debtor or to whomsoever may be lawfully entitled to receive the same. Nothing
set forth in this subparagraph (b) shall authorize or be construed to authorize
Debtor to sell or otherwise dispose of any Collateral except as provided in
subparagraph 6(b) hereof.
(c) Agent shall have the rights and remedies of a secured
party under this agreement, under any other instrument or agreement securing,
evidencing or relating to the Obligations and under the law of the State of
Ohio. Without limiting the generality of the foregoing, Agent shall have the
right to take possession of the Collateral and all books and records relating to
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the Collateral and for that purpose Agent may enter upon any premises on which
the Collateral or books and records relating to the Collateral or any part
thereof may be situated and remove the same therefrom. Debtor expressly agrees
that Agent, without demand of performance or other demand, advertisement or
notice of any kind (except the notices specified below of time and place of
public sale or disposition or time after which a private sale or disposition is
to occur) to or upon Debtor or any other person or entity (all and each of which
demands, advertisements and/or notices are hereby expressly waived), may
forthwith collect, receive, appropriate and realize upon the Collateral, or any
part thereof, and/or may forthwith sell, lease, assign, give option or options
to purchase or sell or otherwise dispose of and deliver the Collateral (or
contract to do so), or any part thereof, in one or more parcels at public or
private sale or sales, at any of Agent's offices or elsewhere at such prices as
Agent may deem best, for cash or on credit or for future delivery without
assumption of any credit risk. Agent shall have the right upon any such public
sale or sales, and, to the extent permitted by law, upon any such private sale
or sales, to purchase the whole or any part of the Collateral so sold, free of
any right or equity of redemption in Debtor. Debtor further agrees, at Agent's
request, to assemble the Collateral and to make it available to Agent at such
places as Agent may reasonably select, whether at Debtor's premises or
elsewhere. Debtor further agrees to allow Agent to use or occupy Debtor's
premises, without charge, for the purpose of effecting Agent's remedies in
respect of the Collateral. Agent shall apply the net proceeds of any such
collection, recovery, receipt, appropriation, realization or sale, after
deducting all reasonable costs and expenses of every kind incurred in connection
therewith or incidental to the care or safekeeping of any or all of the
Collateral or in any way relating to the rights of Agent hereunder, including
reasonable attorneys' fees to the extent permitted by law and reasonable legal
expenses, to the payment in whole or in part of the Obligations, in such order
as Agent may elect, and only after so paying over such net proceeds and after
the payment by Agent of any other amount required by any provision of law,
including Ohio Revised Code Section 1309.615(A)(3), need Agent account for the
surplus, if any, to Debtor. To the extent permitted by applicable law, Debtor
waives all claims, damages and demands against Agent arising out of the
repossession, retention, sale or disposition of the Collateral. Debtor agrees
that Agent need not give more than ten (10) days' notice (which notification
shall be deemed given when mailed, postage prepaid, addressed to Debtor at
Debtor's address set forth at the beginning of this agreement or when telecopied
or telegraphed to that address or when telephoned or otherwise communicated
orally to Debtor or any agent of Debtor at that address) of the time and place
of any public sale or of the time after which a private sale may take place and
that such notice is reasonable notification of such matters. Debtor shall remain
liable for any deficiency if the proceeds of any sale or disposition of the
Collateral are insufficient to pay all amounts to which Agent is entitled.
Debtor shall also be liable for the costs of collecting any of the Obligations
or otherwise enforcing the terms thereof or of this agreement including
reasonable attorneys' fees to the extent permitted by law.
11. GENERAL. Any provision of this agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction. Agent shall not be deemed to have waived any of its rights
hereunder or under any
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other agreement, instrument or paper signed by Debtor unless such waiver be in
writing and signed by Agent. No delay or omission on the part of Agent in
exercising any right shall operate as a waiver of such right or any other right.
All of Agent's rights and remedies, whether evidenced hereby or by any other
agreement, instrument or paper, shall be cumulative and may be exercised
singularly or concurrently. Any written demand upon or written notice to Debtor
shall be effective when deposited in the mails addressed to Debtor at the
address shown at the beginning of this agreement. This agreement and all rights
and obligations hereunder, including matters of construction, validity and
performance, shall be governed by the law of the State of Ohio, without giving
effect to the conflict of law rules thereof. The provisions hereof shall, as the
case may require, bind or inure to the benefit of, the respective heirs,
successors, legal representatives and assigns of Debtor and Agent.
SCHEDULE OF ADDITIONAL PLACES OF BUSINESS
AND LOCATIONS OF COLLATERAL
LISTED IN SCHEDULE 2.15 TO THE BANK AGREEMENT
SCHEDULE OF ADDITIONAL CLAIMS AND INTERESTS
PERMITTED LIENS UNDER THE BANK AGREEMENT
PERMITTED LIENS UNDER THE MET LIFE AGREEMENT
SUPPLEMENTAL SCHEDULE OF COLLATERAL
N/A
IN WITNESS WHEREOF, Debtor has signed this agreement this 27th day of
December, 2002.
X. X. XXXXX CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxxx
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Its: Vice President
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