EXHIBIT 10.11
GUARANTOR SECURITY AGREEMENT
----------------------------
THIS SECURITY AGREEMENT (this "Agreement") dated as of July 10, 1998, is by
---------
and among the undersigned debtors (collectively, the "Debtors" and each a
-------
"Debtor"), and Chase Bank of Texas, National Association (formerly known as
-------
Texas Commerce Bank National Association), a national banking association
("Chase"), not in its individual capacity but solely as agent for itself and
-------
each of the other banks or lending institutions (each, a "Bank" and,
----
collectively, the "Banks") which is or may from time to time become a signatory
-----
to the Credit Agreement (hereinafter defined) or any successor or permitted
assignee thereof (Chase in such capacity, together with its successors in such
capacity, the "Agent").
-----
R E C I T A L S:
---------------
A. CellStar Corporation, a Delaware corporation (the "Borrower"), the
--------
Agent, The First National Bank of Chicago and National City Bank, as co-agents
(collectively, the "Co-Agents"), and the Banks heretofore entered into that
---------
certain Credit Agreement dated as of October 15, 1997 (such Credit Agreement, as
the same has been and may be amended, supplemented or modified from time to
time, the "Credit Agreement").
----------------
B. The Credit Agreement requires each Debtor to execute and deliver this
Agreement.
A G R E E M E N T
- - - - - - - - -
NOW THEREFORE, in consideration of the premises and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:
ARTICLE I
Definitions
-----------
Section 1.1. Definitions. As used in this Agreement, the following terms
-----------
have the following meanings:
"Accounts" means any "account", as such term is defined in Section
--------
9.106 of the UCC, now owned or hereafter acquired by any Debtor, and, in
any event, shall include, without limitation, each of the following,
whether now owned or hereafter acquired by any Debtor: (a) all rights of
any Debtor to payment for goods sold or leased or services rendered,
whether or not earned by performance, (b) all accounts receivable of any
Debtor, (c) all rights of any Debtor to receive any payment of money or
other form of consideration, (d) all security pledged, assigned, or granted
to or held by any Debtor to secure any of the foregoing, (e) all guaranties
of, or indemnifications with respect to, any of the foregoing, and (f) all
rights of any Debtor
GUARANTOR SECURITY AGREEMENT - PAGE 1
as an unpaid seller of goods or services, including, but not limited to,
all rights of stoppage in transit, replevin, reclamation, and resale.
"Chattel Paper" means any "chattel paper", as such term is defined in
-------------
Section 9.105(a)(2) of the UCC, now owned or hereafter acquired by any
Debtor.
"Collateral" has the meaning specified in Section 2.1 of this
---------- -----------
Agreement.
"Document" means any "document", as such term is defined in Section
--------
9.105(a)(6) of the UCC, now owned or hereafter acquired by any Debtor,
including, without limitation, all documents of title and warehouse
receipts of any Debtor.
"Equipment" means any "equipment", as such term is defined in Section
---------
9.109(2) of the UCC, now owned or hereafter acquired by any Debtor and, in
any event, shall include, without limitation, all machinery, equipment,
furnishings, fixtures, and vehicles now owned or hereafter acquired by any
Debtor and any and all additions, substitutions, and replacements of any of
the foregoing, wherever located, together with all attachments, components,
parts, equipment, and accessories installed thereon or affixed thereto.
"General Intangibles" means any "general intangibles", as such term is
-------------------
defined in Section 9.106 of the UCC, now owned or hereafter acquired by any
Debtor and, in any event, shall include, without limitation, each of the
following, whether now owned or hereafter acquired by any Debtor: (a) all
patents, patent applications, patent rights, service marks, trademarks,
trade names, trade secrets, intellectual property, registrations, goodwill,
copyrights, franchises, licenses, permits, proprietary information,
customer lists, designs, and inventions of any Debtor, (b) all books,
records, data, plans, manuals, computer software, and computer programs of
any Debtor, (c) all contract rights, partnership interests, joint venture
interests, securities, deposit accounts, investment accounts, and
certificates of deposit of any Debtor, (d) all rights of any Debtor to
payment under letters of credit and similar agreements, (e) all tax refunds
and tax refund claims of any Debtor, (f) all choses in action and causes of
action of any Debtor (whether arising in contract, tort, or otherwise and
whether or not currently in litigation) and all judgments in favor of any
Debtor, (g) all rights and claims of any Debtor under warranties and
indemnities, and (h) all rights of any Debtor under any insurance, surety,
or similar contract or arrangement.
"Instrument" means any "instrument", as such term is defined in
----------
Section 9.105(a)(9) of the UCC, now owned or hereafter acquired by any
Debtor.
"Inventory" means any "inventory", as such term is defined in Section
---------
9.109(4) of the UCC, now owned or hereafter acquired by any Debtor, and, in
any event, shall include, without limitation, each of the following,
whether now owned or hereafter acquired by any Debtor: (a) all goods and
other personal property of any
GUARANTOR SECURITY AGREEMENT - PAGE 2
Debtor that are held for sale or lease or to be furnished under any
contract of service, (b) all raw materials, work-in-process, finished
goods, inventory, supplies, and materials of any Debtor, (c) all wrapping,
packaging, advertising, and shipping materials of any Debtor, (d) all goods
that have been returned to, repossessed by, or stopped in transit by any
Debtor, and (e) all Documents evidencing any of the foregoing.
"Obligations" means:
-----------
(a) the indebtedness, liabilities and obligations of the Borrower to
the Banks evidenced by those Notes executed by the Borrower pursuant to the
Credit Agreement and payable to the order of the Banks in the aggregate
principal amount of $135,000,000;
(b) the indebtedness, liabilities and obligations of each Debtor to
the Agent, the Co-Agents and the Banks under the Guaranty executed by each
Debtor in favor of the Agent, the Co-Agents and the Banks;
(c) the "Obligations" as such term is defined in the Credit Agreement;
(d) all future Advances by the Agent, the Co-Agents or any Bank to the
Borrower and the Debtors, or any of them;
(e) all costs and expenses, including without limitation all
reasonable attorneys' fees and legal expenses, incurred by the Agent, any
Co-Agent or any Bank to preserve and maintain the Collateral, collect the
obligations herein described and enforce this Agreement;
(f) all other obligations, indebtedness and liabilities of the
Borrower and the Debtors, or any of them, to the Agent, any Co-Agent or any
Bank under any of the Loan Documents, now existing or hereafter arising,
regardless of whether such obligations, indebtedness and liabilities are
similar, dissimilar, related, unrelated, direct, indirect, fixed,
contingent, primary, secondary, joint, several, or joint and several; and
(g) all extensions, renewals and modifications of any of the
foregoing.
"Permitted Liens" means the security interests granted hereby and
---------------
Liens expressly permitted by Section 10.2 of the Credit Agreement.
------------
"Proceeds" means any "proceeds", as such term is defined in Section
--------
9.306 of the UCC and, in any event, shall include, but not be limited to,
(a) any and all proceeds of any insurance, indemnity, warranty, or guaranty
payable to any Debtor from time to time with respect to any of the
Collateral, (b) any and all payments (in any form whatsoever) made or due
and payable to any Debtor from time to time in connection with any
requisition, confiscation, condemnation, seizure, or forfeiture of all or
any part of the Collateral by any Governmental Authority (or any person
GUARANTOR SECURITY AGREEMENT - PAGE 3
acting under color of Governmental Authority), and (c) any and all other
amounts from time to time paid or payable under or in connection with any
of the Collateral.
"UCC" means the Uniform Commercial Code as in effect in the State of
---
Texas or, if so required with respect to any particular Collateral by
mandatory provisions of applicable law, as in effect in the jurisdiction in
which such Collateral is located.
Section 1.2. Terms Defined in Credit Agreement. All capitalized terms
---------------------------------
used and not otherwise defined herein shall have their respective meanings as
specified in the Credit Agreement.
ARTICLE IV
Security Interest
-----------------
Section 2.1. Security Interest. As collateral security for the prompt
-----------------
payment and performance in full when due of the Obligations (whether at stated
maturity, by acceleration, or otherwise), each Debtor hereby grants to the
Agent, for the pro rata benefit of the Banks, a first priority lien on and
security interest in all of its personal property, including without limitation
all of its right, title, and interest in and to the following, whether now owned
or hereafter arising or acquired and wherever located (collectively, the
"Collateral"):
-----------
(a) all Accounts;
(b) all Chattel Paper;
(c) all Instruments;
(d) all General Intangibles;
(e) all Documents;
(f) all Inventory;
(g) all Equipment; and
(h) all Proceeds and products of any or all of the foregoing.
Without limiting the foregoing, this Agreement secures the payment of all
amounts that constitute part of the Obligations and would be owed by the
Borrower to the Agent, any Co-Agent or any Bank but for the fact that they are
unenforceable or not allowable due to the existence of bankruptcy,
reorganization, or similar proceedings involving the Borrower. If the grant,
pledge, or collateral transfer or assignment of any rights of any Debtor under
any contract included in the Collateral is expressly prohibited by such
contract, then the security interest hereby granted
GUARANTOR SECURITY AGREEMENT - PAGE 4
nonetheless remains effective to the extent allowed by Section 9.318 of the UCC
or other applicable law but is otherwise limited by that prohibition.
Section 2.2. Debtors Remain Liable. Notwithstanding anything to the
---------------------
contrary contained herein, (a) each Debtor shall remain liable under the
contracts and agreements included in the Collateral to the extent set forth
therein to perform all of its duties and obligations thereunder to the same
extent as if this Agreement had not been executed, (b) the exercise by the Agent
of any of its rights hereunder shall not release any Debtor from any of its
duties or obligations under the contracts and agreements included in the
Collateral, and (c) neither the Agent, any Co-Agent nor any Bank shall have any
obligation or liability under any of the contracts and agreements included in
the Collateral by reason of this Agreement, nor shall the Agent, any Co-Agent or
any Bank be obligated to perform any of the obligations or duties of any Debtor
thereunder or to take any action to collect or enforce any claim for payment
assigned hereunder.
ARTICLE III
Representations and Warranties
------------------------------
Each Debtor represents and warrants to the Agent that:
Section 3.1. Title. The Debtors are, and with respect to Collateral
-----
acquired after the date hereof the Debtors will be, the legal and beneficial
owners of their respective Collateral free and clear of any Lien, except
Permitted Liens.
Section 3.2. Accounts. Unless a Debtor has given the Agent written
--------
notice to the contrary, whenever the security interest granted hereunder
attaches to an Account, each Debtor shall be deemed to have represented and
warranted to the Agent as to each and all of its Accounts that (a) each Account
is genuine and in all respects what it purports to be, (b) each Account
represents the legal, valid, and binding obligation of the account debtor
evidencing indebtedness unpaid and owed by such account debtor arising out of
the performance of labor or services by such Debtor or the sale or lease of
goods by such Debtor, (c) the amount of each Account represented as owing is the
correct amount actually and unconditionally owing except for normal trade
discounts granted in the ordinary course of business, and (d) to the best of
Debtor's knowledge, no Account is subject to any offset, counterclaim, or other
defense.
Section 3.3. Financing Statements. No financing statement, security
--------------------
agreement, or other Lien instrument covering all or any part of the Collateral
is on file in any public office, except those filed in favor of the Agent
pursuant to this Agreement or with respect to any other Permitted Liens. Except
as set forth on Schedule 3 hereto, no Debtor has within the past five years done
----------
business under any name or trade name other than its legal name set forth at the
beginning of this Agreement.
Section 3.4. Principal Place of Business. The principal place of
---------------------------
business and chief executive office of each Debtor, and the office where each
Debtor keeps its books and records, is located at the address specified below
the name of such Debtor on the signature pages hereof.
GUARANTOR SECURITY AGREEMENT - PAGE 5
Section 3.5. Location of Collateral. All Inventory and Equipment of each
----------------------
Debtor are located at the places specified on Schedule 1 hereto. Each Debtor
----------
has exclusive possession and control of its Inventory and Equipment. None of
the Inventory or Equipment of any Debtor is evidenced by a Document (including,
without limitation, a negotiable document of title). All Instruments and
Chattel Paper of each Debtor have been delivered to the Agent.
Section 3.6. Perfection. This Agreement creates a security interest in
----------
the Collateral in favor of the Agent. Upon the filing of UCC financing
statements in favor of the Agent in the jurisdictions listed on Schedule 2
----------
attached hereto, and upon the Agent's obtaining possession of all Documents and
Instruments of each Debtor, the security interest in favor of the Agent created
herein will constitute a valid and perfected Lien upon and security interest in
the Collateral, subject to no equal or prior Lien, except the Permitted Liens.
Section 3.7. Benefit to Debtors. The value of the consideration received
------------------
and to be received by each Debtor as a result of the Borrower, the Agent, the
Co-Agents and the Banks entering into and obtaining credit under the Credit
Agreement and the Debtors executing and delivering this Agreement is reasonably
worth at least as much as the liability and obligation of such Debtor hereunder,
and such liability and obligation and the Borrower's entering into and obtaining
credit under the Credit Agreement have benefited and may reasonably be expected
to benefit each Debtor directly and indirectly.
Section 3.8. Credit Agreement. Each and every representation and
----------------
warranty contained in the Credit Agreement is true and correct in all respects.
ARTICLE IV
Covenants
---------
The Debtors jointly and severally covenant and agree with the Agent that
until the Obligations are paid and performed in full and all Commitments have
terminated:
Section 4.1. Encumbrances. No Debtor shall create, permit, or suffer to
------------
exist, and each Debtor shall defend the Collateral against, any Lien on the
Collateral, except the Permitted Liens, and each Debtor shall defend its rights
in the Collateral and the Agent's security interest in the Collateral against
the claims and demands of all Persons. No Debtor shall do anything to impair
the rights of the Agent in the Collateral.
Section 4.2. Modification of Accounts. Each Debtor shall, in accordance
------------------------
with prudent business practices, endeavor to collect or cause to be collected
from each account debtor under its Accounts, as and when due, any and all
amounts owing under such Accounts. Without the prior written consent of the
Agent, no Debtor shall (a) grant any extension of time for any payment with
respect to any of the Accounts, except for extensions of time granted in the
ordinary course of such Debtor's business for payment with respect to Accounts
not included in the Borrowing Base, (b)
GUARANTOR SECURITY AGREEMENT - PAGE 6
compromise, compound, or settle any of the Accounts for less than the full
amount thereof, except for compromise, compound or settlement in the ordinary
course of business of Accounts not included in the Borrowing Base, (c) release,
in whole or in part, any Person liable for payment thereof, except in connection
with settlements permitted by clause (b) above, (d) allow any credit or discount
----------
for payment with respect to any Account other than trade discounts granted in
the ordinary course of business, or (e) release any Lien or guaranty securing
any Account, except in connection with settlements permitted by clause (b)
above.
Section 4.3. Disposition of Collateral. No Debtor shall sell, lease,
-------------------------
assign (by operation of law or otherwise), or otherwise dispose of, or grant any
option with respect to, the Collateral or any part thereof without the prior
written consent of the Agent, except as expressly permitted by the Credit
Agreement.
Section 4.4. Further Assurances. At any time and from time to time, upon
------------------
the request of the Agent, and at the sole expense of the Debtors, each Debtor
shall promptly execute and deliver all such further instruments, agreements, and
documents and take such further action as the Agent may deem necessary or
desirable to preserve and perfect its security interest in the Collateral and
carry out the provisions and purposes of this Agreement. Without limiting the
generality of the foregoing, each Debtor shall (a) execute and deliver to the
Agent such financing statements as the Agent may from time to time require; (b)
deliver and pledge to the Agent all Documents (including, without limitation,
negotiable documents of title) evidencing Inventory or Equipment; (c) deliver
and pledge to the Agent all Instruments and Chattel Paper of such Debtor with
any necessary endorsements; and (d) execute and deliver to the Agent such other
documents, instruments, and agreements as the Agent may require to perfect and
maintain the validity, effectiveness, and priority of the Loan Documents and the
Liens intended to be created thereby. Each Debtor authorizes the Agent to file
one or more financing or continuation statements, and amendments thereto,
relating to all or any part of the Collateral without the signature of such
Debtor where permitted by law. A carbon, photographic, or other reproduction of
this Agreement or of any financing statement covering the Collateral or any part
thereof shall be sufficient as a financing statement and may be filed as a
financing statement.
Section 4.5. Risk of Loss; Insurance. The Debtors shall be responsible
-----------------------
for any loss or damage to the Collateral. The Debtors shall, at their own
expense, maintain or cause to be maintained insurance with respect to the
Collateral in such amounts, against such risks, in such form, and with such
insurers as shall be satisfactory to the Agent from time to time. Each policy
for liability insurance shall provide for all losses to be paid on behalf of the
Agent, for the pro rata benefit of the Banks and the Debtor as their interests
may appear. Each policy for property insurance shall contain loss payable
clauses and a loss payable endorsement in favor of the Agent, for the pro rata
benefit of the Banks, as its interest may appear. If the Debtors shall fail to
maintain or cause to be maintained the insurance required by this Agreement, the
Agent shall have the right (but shall be under no obligation) to obtain such
insurance and the Debtors jointly and severally agree to reimburse the Agent for
all costs and expenses incurred by the Agent in obtaining such insurance. All
such insurance shall provide that no cancellation, reduction in amount, or
change in coverage thereof shall be effective unless the Agent has received 30
days prior written notice thereof. The
GUARANTOR SECURITY AGREEMENT - PAGE 7
Debtors shall deliver to the Agent and each Bank copies of all insurance
policies required by this Agreement.
Section 4.6. Inspection Rights. Each Debtor shall permit the Agent, each
-----------------
Bank and their respective representatives to examine, inspect, and audit the
Collateral and to examine, inspect, and copy such Debtor's books and records at
any reasonable time and as often as the Agent or any such Bank may desire during
normal business hours. The Agent and each Bank may at any time and from time to
time contact account debtors and other obligors to verify the existence,
amounts, and terms of any Debtor's Accounts.
Section 4.7. Mortgagee's and Landlord's Agreements. With respect to each
-------------------------------------
location of Inventory having an aggregate value of $100,000 or more, as
specified on Schedule 1 hereto, each Debtor shall cause each mortgagee of real
----------
property owned by such Debtor and each landlord of real property leased by such
Debtor who has not previously done so to execute and deliver to the Agent, on or
before the date hereof, instruments satisfactory in form and substance to the
Agent by which such mortgagee or landlord waives its rights, if any, in the
Collateral (each, a "Landlord's Agreement"). After the date hereof, each Debtor
--------------------
shall promptly deliver or cause to be delivered to the Agent Landlord's
Agreements in accordance with this Section for each location where the Inventory
hereafter has an aggregate value of $100,000 or more. At the request of the
Agent, each Debtor shall promptly deliver or cause to be delivered Landlord's
Agreements for any locations where any Collateral may now or hereafter be
located.
Section 4.8. Corporate Changes. No Debtor shall change its name,
-----------------
identity, or corporate structure in any manner that might make any financing
statement filed in connection with this Agreement seriously misleading unless
such Debtor shall have given the Agent 30 days prior written notice thereof and
shall have taken all action deemed necessary or desirable by the Agent to make
each financing statement not seriously misleading. No Debtor shall change its
principal place of business, chief executive office, or the place where it keeps
its books and records unless it shall have given the Agent 30 days prior written
notice thereof and shall have taken all action deemed necessary or desirable by
the Agent to cause its security interest in the Collateral to be perfected with
the priority required by this Agreement.
Section 4.9. Books and Records; Information. The Debtors shall keep
------------------------------
accurate and complete books and records of the Collateral and the Debtors'
business and financial condition in accordance with GAAP. Each Debtor shall
from time to time at the request of the Agent deliver to the Agent such
information regarding the Collateral and such Debtor as the Agent may request,
including, without limitation, lists and descriptions of the Collateral and
evidence of the identity and existence of the Collateral. Each Debtor shall
xxxx its books and records to reflect the security interest of the Agent under
this Agreement.
GUARANTOR SECURITY AGREEMENT - PAGE 8
Section 4.10. Equipment and Inventory.
-----------------------
(b) The Debtors shall keep the Equipment and Inventory at the
locations specified on Schedule 1 hereto or, upon 30 days prior written
----------
notice to the Agent, at such other places within the United States of
America where all action required to perfect the Agent's security interest
in the Equipment and Inventory with the priority required by this Agreement
shall have been taken.
(d) The Debtors shall maintain the Equipment and Inventory in good
condition and repair (ordinary wear and tear excepted). None of the
Debtors shall permit any waste or destruction of the Equipment or Inventory
or any part thereof. None of the Debtors shall permit the Equipment or
Inventory to be used in violation of any law, rule, or regulation or
inconsistently with the terms of any policy of insurance. None of the
Debtors shall use or permit any of the Equipment or Inventory to be used in
any manner or for any purpose that would impair its value or expose it to
unusual risk.
Section 4.11. Warehouse Receipts Non-Negotiable. Each Debtor agrees that
---------------------------------
if any warehouse receipt or receipt in the nature of a warehouse receipt is
issued in respect of any of the Collateral, such warehouse receipt or receipt in
the nature thereof shall not be "negotiable" (as such term is used in Section
7.104 of the UCC as in effect in any relevant jurisdiction or under relevant
law).
Section 4.12. Notification. The Debtors shall promptly, and in any event
------------
within five days after any Debtor obtains knowledge or becomes aware of any of
the following, notify the Agent of (a) any Lien or claim that has attached to or
been made or asserted against any of the Collateral, (b) any material damage to
or loss of any of the Collateral, (c) the occurrence of any other event that
could have a material adverse effect on the Collateral or the security interest
created hereunder, and (d) the occurrence or existence of any Default.
Section 4.13. Collection of Accounts. Except as otherwise provided in
----------------------
this Section, the Debtors shall have the right to collect and receive payments
on the Accounts. In connection with such collections, the Debtors may take
(and, at the Agent's direction, shall take) such actions as the Debtors or the
Agent may deem necessary or advisable to enforce collection of the Accounts. At
any time, if an Event of Default shall have occurred and be continuing, the
Agent shall have the right to, or upon the request of the Agent the Debtors
shall, instruct all account debtors and other Persons obligated in respect of
the Accounts to make all payments on the Accounts either (a) directly to the
Agent (by instructing that such payments be remitted to a post office box which
shall be in the name and under the control of the Agent), or (b) to one or more
other banks in the United States of America (by instructing that such payments
be remitted to a post office box which shall be in the name or under the control
of the Agent) under arrangements in form and substance satisfactory to the Agent
pursuant to which the Debtors shall have irrevocably instructed such other bank
(and such other bank shall have agreed) to remit all such payments directly to
the Agent. In addition to the foregoing, each Debtor agrees that if any
Proceeds of any Collateral (including payments made in respect of Accounts)
shall be received by such Debtor while an Event of Default exists, such Debtor
GUARANTOR SECURITY AGREEMENT - PAGE 9
shall promptly deliver such Proceeds to the Agent, for the pro rata benefit of
the Banks, with any necessary endorsements. Until such Proceeds are delivered to
the Agent, such Proceeds shall be held in trust by such Debtor for the benefit
of the Agent and shall not be commingled with any other funds or property of any
Debtor. All Proceeds of Collateral received by the Agent pursuant to this
Section may at the option of the Required Banks in the exercise of their
absolute discretion, (i) be applied by the Agent and the Banks to their
respective Obligations in such order and manner as they may elect in their
absolute discretion, or (ii) be deposited to the credit of any Debtor and held
as collateral for the Obligations or permitted to be used by such Debtor in the
ordinary course of its business.
ARTICLE V
Rights of the Agent
-------------------
Section 5.1. Power of Attorney. Each Debtor hereby irrevocably
-----------------
constitutes and appoints the Agent and any officer or agent thereof, with full
power of substitution, as its true and lawful attorney-in-fact with full
irrevocable power and authority in the name of such Debtor or in its own name,
to take any and all action and to execute any and all documents and instruments
which the Agent at any time and from time to time deems necessary or desirable
to accomplish the purposes of this Agreement and, without limiting the
generality of the foregoing, each Debtor hereby gives the Agent the power and
right on behalf of such Debtor and in its own name to do any of the following,
without notice to or the consent of such Debtor and whether or not an Event of
Default has occurred and is continuing (except as otherwise expressly provided
below).
(i) after the occurrence and during the continuance of an Event
of Default, to demand, xxx for, collect, or receive in the name of any
Debtor or in its own name, any money or property at any time payable or
receivable on account of or in exchange for any of the Collateral and, in
connection therewith, endorse checks, notes, drafts, acceptances, money
orders, documents of title, or any other instruments for the payment of
money under the Collateral or any policy of insurance;
(ii) to pay or discharge taxes or Liens levied or placed on or
threatened against the Collateral;
(iii) after the occurrence and during the continuance of an Event
of Default, to notify post office authorities to change the address for
delivery of mail of any Debtor to an address designated by the Agent and to
receive, open, and dispose of mail addressed to any Debtor;
(iv) (A) after the occurrence and during the continuance of an
Event of Default, to direct account debtors and any other parties liable
for any payment under any of the Collateral to make payment of any and all
monies due and to become due thereunder directly to the Agent or as the
Agent shall direct; (B) after the occurrence and during the continuance
GUARANTOR SECURITY AGREEMENT - PAGE 10
of an Event of Default, to receive payment of and receipt for any and all
monies, claims, and other amounts due and to become due at any time in
respect of or arising out of any Collateral; (C) after the occurrence and
during the continuance of an Event of Default, to sign and endorse any
invoices, freight or express bills, bills of lading, storage or warehouse
receipts, drafts against debtors, assignments, proxies, stock powers,
verifications, and notices in connection with accounts and other documents
relating to the Collateral; (D) after the occurrence and during the
continuance of an Event of Default, to commence and prosecute any suit,
action, or proceeding at law or in equity in any court of competent
jurisdiction to collect the Collateral or any part thereof and to enforce
any other right in respect of any Collateral; (E) after the occurrence and
during the continuance of an Event of Default, to defend any suit, action,
or proceeding brought against any Debtor with respect to any Collateral;
(F) after the occurrence and during the continuance of an Event of Default,
to settle, compromise, or adjust any suit, action, or proceeding described
above and, in connection therewith, to give such discharges or releases as
the Agent may deem appropriate; (G) to exchange any of the Collateral for
other property upon any merger, consolidation, reorganization,
recapitalization, or other readjustment of the issuer thereof and, in
connection therewith, deposit any of the Collateral with any committee,
depositary, transfer agent, registrar, or other designated agency upon such
terms as the Agent may determine; (H) to add or release any guarantor,
indorser, surety, or other party to any of the Collateral; (I) to renew,
extend, or otherwise change the terms and conditions of any of the
Collateral; (J) to make, settle, compromise, or adjust claims under any
insurance policy covering any of the Collateral; and (K) after the
occurrence and during the continuance of an Event of Default, to sell,
transfer, pledge, make any agreement with respect to or otherwise deal with
any of the Collateral as fully and completely as though the Agent were the
absolute owner thereof for all purposes, and to do, at the Agent's option
and the Debtors' expense, at any time, or from time to time, all acts and
things which the Agent deems necessary to protect, preserve, or realize
upon the Collateral and the Agent's security interest therein.
This power of attorney is a power coupled with an interest and shall be
irrevocable. The Agent shall be under no duty to exercise or withhold the
exercise of any of the rights, powers, privileges, and options expressly or
implicitly granted to the Agent in this Agreement, and shall not be liable for
any failure to do so or any delay in doing so. The Agent shall not be liable
for any act or omission or for any error of judgment or any mistake of fact or
law in its individual capacity or in its capacity as attorney-in-fact except
acts or omissions resulting from its willful misconduct. This power of attorney
is conferred on the Agent solely to protect, preserve, and realize upon its
security interest in the Collateral. The Agent shall not be responsible for any
decline in the value of the Collateral and shall not be required to take any
steps to preserve rights against prior parties or to protect, preserve, or
maintain any security interest or Lien given to secure the Collateral.
Section 5.2. Setoff; Property Held by the Agents and the Banks. If an
-------------------------------------------------
Event of Default shall have occurred and be continuing, the Agent, each Co-Agent
and each Bank shall have the right to set off and apply against the Obligations,
at any time and without notice to any Debtor, any and all deposits (general or
special, time or demand, provisional or final) or other sums at any time
credited by or owing from the Agent, any Co-Agent or any Bank to such Debtor
whether or not the
GUARANTOR SECURITY AGREEMENT - PAGE 11
Obligations are then due. As additional security for the Obligations, each
Debtor hereby grants the Agent, each Co-Agent and each Bank a security interest
in all money, instruments, and other property of such Debtor now or hereafter
held by the Agent, any Co-Agent or any Bank, including without limitation,
property held in safekeeping. In addition to the Agent's, any Co-Agent's or any
Bank's right of setoff and as further security for the Obligations, each Debtor
hereby grants the Agent, each Co-Agent and each Bank a security interest in all
deposits (general or special, time or demand, provisional or final) of such
Debtor now or hereafter on deposit with or held by the Agent, any Co-Agent or
any Bank and all other sums at any time credited by or owing from the Agent, any
Co-Agent or any Bank to such Debtor. The rights and remedies of the Agent, each
Co-Agent and each Bank hereunder are in addition to other rights and remedies
(including, without limitation, other rights of setoff) which the Agent, any Co-
Agent or any Bank may have.
Section 5.3. Performance by the Agent. If any Debtor shall fail to
------------------------
perform any covenant or agreement contained in this Agreement, the Agent may
perform or attempt to perform such covenant or agreement on behalf of such
Debtor. In such event, the Debtors shall, at the request of the Agent, promptly
pay any amount expended by the Agent in connection with such performance or
attempted performance to the Agent, together with interest thereon at the
Default Rate from and including the date of such expenditure to but excluding
the date such expenditure is paid in full. Notwithstanding the foregoing, it is
expressly agreed that the Agent shall not have any liability or responsibility
for the performance of any obligation of any Debtor under this Agreement.
Section 5.4. Subrogation. If any of the Obligations are given in renewal
-----------
or extension or applied toward the payment of indebtedness secured by any Lien,
Agent, the Co-Agents and the Banks shall be, and are hereby, subrogated to all
of the rights, titles, interests and Liens securing the indebtedness so renewed,
extended, or paid.
Section 5.5. Agent's Duty of Care. Other than the exercise of reasonable
--------------------
care and the physical custody of the Collateral while held by the Agent
hereunder, the Agent shall have no responsibility for or obligation or duty with
respect to all or any part of the Collateral or any matter or proceeding arising
out of or relating thereto, including without limitation any obligation or duty
to collect any sums due in respect thereof or to protect or preserve any rights
against prior parties or any other rights pertaining thereto, it being
understood and agreed that each Debtor shall be responsible for preservation of
all rights in the Collateral. Without limiting the generality of the foregoing,
the Agent shall be conclusively deemed to have exercised reasonable care in the
custody of the Collateral if the Agent takes such action, for purposes of
preserving rights in the Collateral, as any Debtor may reasonably request in
writing, but no failure or omission or delay by the Agent in complying with any
such request by any Debtor, and no refusal by the Agent to comply with any such
request by any Debtor, shall be deemed to be a failure to exercise reasonable
care.
GUARANTOR SECURITY AGREEMENT - PAGE 12
ARTICLE VI
Default
-------
Section 6.1. Rights and Remedies. If an Event of Default shall have
-------------------
occurred and be continuing, the Agent shall have the following rights and
remedies:
(i) In addition to all other rights and remedies granted to the
Agent in this Agreement or in any other Loan Document or by applicable law,
the Agent shall have all of the rights and remedies of a secured party
under the UCC (whether or not the UCC applies to the affected Collateral).
Without limiting the generality of the foregoing, the Agent may (1) without
demand or notice to any Debtor, collect, receive, or take possession of the
Collateral or any part thereof and for that purpose the Agent may enter
upon any premises on which the Collateral is located and remove the
Collateral therefrom or render it inoperable, and/or (2) sell, lease, or
otherwise dispose of the Collateral, or any part thereof, in one or more
parcels at public or private sale or sales, at the Agent's offices or
elsewhere, for cash, on credit or for future delivery, and upon such other
terms as the Agent may deem commercially reasonable. The Agent shall have
the right at any public sale or sales, and, to the extent permitted by
applicable law, at any private sale or sales, to bid and become a purchaser
of the Collateral or any part thereof free of any right or equity of
redemption on the part of any Debtor, which right or equity of redemption
is hereby expressly waived and released by each Debtor. Upon the request
of the Agent, each Debtor shall assemble the Collateral and make it
available to the Agent at any place designated by the Agent that is
reasonably convenient to such Debtor and the Agent. Each Debtor agrees
that the Agent shall not be obligated to give more than five days written
notice of the time and place of any public sale or of the time after which
any private sale may take place and that such notice shall constitute
reasonable notice of such matters. The Agent shall not be obligated to
make any sale of Collateral if it shall determine not to do so, regardless
of the fact that notice of sale of Collateral may have been given. The
Agent may, without notice or publication, adjourn any public or private
sale or cause the same to be adjourned from time to time by announcement at
the time and place fixed for sale, and such sale may, without further
notice, be made at the time and place to which the same was so adjourned.
The Debtors shall be jointly and severally liable for all expenses of
retaking, holding, preparing for sale, or the like, and all attorneys'
fees, legal expenses, and all other costs and expenses incurred by the
Agent in connection with the collection of the Obligations and the
enforcement of the Agent's rights under this Agreement. The Debtors shall
remain liable for any deficiency if the Proceeds of any sale or other
disposition of the Collateral are insufficient to pay the Obligations in
full. The Agent, the Co-Agents and the Banks may apply the Collateral
against the Obligations in such order and manner as the Agent may elect in
its sole discretion. Each Debtor waives all rights of marshalling,
valuation, and appraisal in respect of the Collateral.
(ii) The Agent may cause any or all of the Collateral held by it
to be transferred into the name of the Agent or the name or names of the
Agent's nominee or nominees.
GUARANTOR SECURITY AGREEMENT - PAGE 13
(iii) The Agent may collect or receive all money or property at any
time payable or receivable on account of or in exchange for any of the
Collateral, but shall be under no obligation to do so.
(iv) On any sale of the Collateral, the Agent is hereby authorized
to comply with any limitation or restriction with which compliance is
necessary, in the view of the Agent's counsel, in order to avoid any
violation of applicable law or in order to obtain any required approval of
the purchaser or purchasers by any applicable Governmental Authority.
ARTICLE VII
Miscellaneous
-------------
Section 7.1. Expenses. The Debtors hereby jointly and severally agree to
--------
pay on demand: (a) all reasonable costs and out-of-pocket expenses of the Agent
in connection with the preparation, negotiation, execution, and delivery of this
Agreement and the other Loan Documents and any and all amendments,
modifications, renewals, extensions, and supplements thereof and thereto,
including, without limitation, the reasonable fees and expenses of legal counsel
for the Agent, (b) all costs and out-of-pocket expenses of the Agent and the
Banks, or any of them in connection with any Default and the enforcement of this
Agreement or any other Loan Document, including, without limitation, the
reasonable fees and expenses of legal counsel for the Agent and the Banks, or
any of them, (c) all transfer, stamp, documentary, or other similar taxes,
assessments, or charges levied by any Governmental Authority in respect of this
Agreement or any of the other Loan Documents, (d) all reasonable costs, out-of-
pocket expenses, assessments, and other charges incurred in connection with any
filing, registration, recording, or perfection of any security interest or Lien
contemplated by this Agreement or any other Loan Document, and (e) all other
reasonable costs and out-of-pocket expenses incurred by the Agent in connection
with this Agreement or any other Loan Document, including, without limitation,
all fees, costs, out-of-pocket expenses, and other charges incurred in
connection with performing or obtaining any audit or appraisal in respect of the
Collateral.
Section 7.2. INDEMNIFICATION. THE DEBTORS HEREBY JOINTLY AND SEVERALLY
---------------
AGREE TO INDEMNIFY THE AGENT AND EACH BANK AND EACH AFFILIATE THEREOF AND THEIR
RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES, ATTORNEYS, AGENTS, AND PARTICIPANTS
FROM, AND HOLD EACH OF THEM HARMLESS AGAINST, ANY AND ALL LOSSES, LIABILITIES,
CLAIMS, DAMAGES, PENALTIES, JUDGMENTS, DISBURSEMENTS, COSTS, INTEREST, EXPENSES
(INCLUDING REASONABLE ATTORNEYS' FEES), AND AMOUNTS PAID IN SETTLEMENT TO WHICH
ANY OF THEM MAY BECOME SUBJECT WHICH DIRECTLY OR INDIRECTLY ARISE FROM OR RELATE
TO (A) THE NEGOTIATION, EXECUTION, DELIVERY, PERFORMANCE, ADMINISTRATION, OR
ENFORCEMENT OF ANY OF THE LOAN DOCUMENTS, (B) ANY OF THE TRANSACTIONS
CONTEMPLATED BY THE LOAN DOCUMENTS, (C) ANY BREACH BY THE BORROWER OR ANY DEBTOR
OF ANY
GUARANTOR SECURITY AGREEMENT - PAGE 14
REPRESENTATION, WARRANTY, COVENANT, OR OTHER AGREEMENT CONTAINED IN ANY OF THE
LOAN DOCUMENTS, (D) THE PRESENCE, RELEASE, THREATENED RELEASE, DISPOSAL,
REMOVAL, OR CLEANUP OF ANY HAZARDOUS MATERIAL LOCATED ON, ABOUT, WITHIN, OR
AFFECTING ANY OF THE PROPERTIES OR ASSETS OF THE BORROWER, ANY DEBTOR OR ANY
SUBSIDIARY, (E) THE USE OR PROPOSED USE OF ANY LETTER OF CREDIT, (F) ANY AND ALL
TAXES, LEVIES, DEDUCTIONS, AND CHARGES IMPOSED ON THE AGENT OR ANY BANK OR ANY
OF THEIR RESPECTIVE CORRESPONDENTS IN RESPECT OF ANY LETTER OF CREDIT, OR (G)
ANY INVESTIGATION, LITIGATION, OR OTHER PROCEEDING, INCLUDING, WITHOUT
LIMITATION, ANY THREATENED INVESTIGATION, LITIGATION, OR OTHER PROCEEDING,
RELATING TO ANY OF THE FOREGOING; PROVIDED, HOWEVER THAT NO PERSON TO BE
-------- -------
INDEMNIFIED HEREUNDER SHALL HAVE THE RIGHT TO BE INDEMNIFIED FOR ITS OWN GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT. WITHOUT LIMITING ANY PROVISION OF THIS
AGREEMENT OR OF ANY OTHER LOAN DOCUMENT, IT IS THE EXPRESS INTENTION OF THE
PARTIES HERETO THAT EACH PERSON TO BE INDEMNIFIED UNDER THIS SECTION SHALL BE
INDEMNIFIED FROM AND HELD HARMLESS AGAINST ANY AND ALL LOSSES, LIABILITIES,
CLAIMS, DAMAGES, PENALTIES, JUDGMENTS, DISBURSEMENTS, COSTS, AND EXPENSES
(INCLUDING ATTORNEYS' FEES) ARISING OUT OF OR RESULTING FROM THE SOLE OR
CONTRIBUTORY NEGLIGENCE OF SUCH PERSON.
Section 7.3. Limitation of Liability. None of the Agent, any Bank, or
-----------------------
any Affiliate, officer, director, employee, attorney, or agent thereof shall
have any liability with respect to, and each Debtor hereby waives, releases, and
agrees not to xxx any of them upon, any claim for any special, indirect,
incidental, or consequential damages suffered or incurred by such Debtor in
connection with, arising out of, or in any way related to, this Agreement or any
of the other Loan Documents, or any of the transactions contemplated by this
Agreement or any of the other Loan Documents. Each Debtor hereby waives,
releases, and agrees not to xxx the Agent or any Bank or any of their respective
Affiliates, officers, directors, employees, attorneys, or agents for punitive
damages in respect of any claim in connection with, arising out of, or in any
way related to, this Agreement or any of the other Loan Documents, or any of the
transactions contemplated by this Agreement or any of the other Loan Documents.
Section 7.4. No Fiduciary Relationship. The relationship between each
-------------------------
Debtor and each Bank with respect to the Loan Documents and the transactions
governed thereby is solely that of debtor and creditor, and neither the Agent
nor any Bank has any fiduciary or other special relationship with any Debtor
with respect to the Loan Documents and the transactions governed thereby, and no
term or condition of any of the Loan Documents shall be construed so as to deem
the relationship between the Debtor and any Bank with respect to the Loan
Documents and the transactions governed thereby to be other than that of debtor
and creditor.
Section 7.5. No Waiver; Cumulative Remedies. No failure on the part of
------------------------------
the Agent, any Co-Agent or any Bank to exercise and no delay in exercising, and
no course of dealing with respect to, any right, power, or privilege under this
Agreement shall operate as a waiver thereof, nor shall
GUARANTOR SECURITY AGREEMENT - PAGE 15
any single or partial exercise of any right, power, or privilege under this
Agreement preclude any other or further exercise thereof or the exercise of any
other right, power, or privilege. The rights and remedies provided for in this
Agreement are cumulative and not exclusive of any rights and remedies provided
by law.
Section 7.6. Successors and Assigns; Parties Bound. This Agreement shall
-------------------------------------
be binding upon and inure to the benefit of the Debtors and the Agent and their
respective heirs, successors, and assigns, except that the Debtors may not
assign any of their rights or obligations under this Agreement without the prior
written consent of the Agent. The Debtors' obligations and agreements hereunder
are joint and several. The provisions of this Agreement shall apply to each
Debtor, individually and collectively.
Section 7.7. ENTIRE AGREEMENT; AMENDMENT; CONTROLLING AGREEMENT. THIS
--------------------------------------------------
AGREEMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT AMONG THE
PARTIES HERETO AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS
OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES HERETO. THERE ARE NO ORAL
AGREEMENTS AMONG THE PARTIES HERETO. The provisions of this Agreement may be
amended or waived only by an instrument in writing signed by the parties hereto.
In the event any term or provision of this Agreement expressly conflicts with
any term or provision of the Credit Agreement, the terms and provisions of the
Credit Agreement shall govern and control.
Section 7.8. Notices. All notices and other communications provided for
-------
in this Agreement shall be given or made in writing and telecopied, mailed by
certified mail return receipt requested, or delivered to the intended recipient
at the address specified below its name on the signature pages hereof; or, as to
any party at such other address as shall be designated by such party in a notice
to the other party given in accordance with this Section. Except as otherwise
provided in this Agreement, all such communications shall be deemed to have been
duly given when transmitted by telecopy, subject to telephone confirmation of
receipt, or when personally delivered or, in the case of a mailed notice, when
duly deposited in the mails, in each case given or addressed as aforesaid.
Section 7.9. GOVERNING LAW; VENUE. THIS AGREEMENT SHALL BE GOVERNED BY
--------------------
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS, AND THE
APPLICABLE LAWS OF THE UNITED STATES OF AMERICA. THIS AGREEMENT HAS BEEN
ENTERED INTO IN DALLAS COUNTY, TEXAS, AND IT SHALL BE PERFORMABLE FOR ALL
PURPOSES IN DALLAS COUNTY, TEXAS.
Section 7.10. Headings. The headings, captions, and arrangements used in
--------
this Agreement are for convenience only and shall not affect the interpretation
of this Agreement.
Section 7.11. Survival of Representations and Warranties. All
------------------------------------------
representations and warranties made in this Agreement shall survive the
execution and delivery of this Agreement, and no investigation by the Agent, any
Co-Agent or any Bank shall affect the representations and
GUARANTOR SECURITY AGREEMENT - PAGE 16
warranties of any Debtor herein or the right of the Agent, any Co-Agent or any
Bank to rely upon them.
Section 7.12. Counterparts. This Agreement may be executed in any number
------------
of counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
Section 7.13. Waiver of Bond. In the event the Agent seeks to take
--------------
possession of any or all of the Collateral by judicial process, each Debtor
hereby irrevocably waives any bonds and any surety or security relating thereto
that may be required by applicable law as an incident to such possession, and
waives any demand for possession prior to the commencement of any such suit or
action.
Section 7.14. Severability. 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 of this Agreement, and any such
prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
Section 7.15. Termination. If all of the Obligations shall have been paid
-----------
and performed in full and all Commitments shall have expired or terminated, the
Agent shall, upon the written request of the Borrower, execute and deliver to
the Debtors a proper instrument or instruments acknowledging the release and
termination of the security interests created by this Agreement, and shall duly
assign and deliver to the Debtors (without recourse and without any
representation or warranty) such of the Collateral as may be in the possession
of the Agent and has not previously been sold or otherwise applied pursuant to
this Agreement.
Section 7.16. WAIVER OF JURY TRIAL. TO THE FULLEST EXTENT PERMITTED BY
--------------------
APPLICABLE LAW, EACH DEBTOR HEREBY IRREVOCABLY AND EXPRESSLY WAIVES ALL RIGHT TO
A TRIAL BY JURY IN ANY ACTION, PROCEEDING, OR COUNTERCLAIM (WHETHER BASED UPON
CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY
OF THE LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THE ACTIONS OF
THE AGENT, ANY CO-AGENT OR ANY BANK IN THE NEGOTIATION, ADMINISTRATION, OR
ENFORCEMENT THEREOF.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
GUARANTOR SECURITY AGREEMENT - PAGE 17
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as
of the day and year first written above.
DEBTORS:
-------
CELLSTAR TELECOM, INC.,
a Delaware corporation
By: /s/ XXXX X. XXXXXXX
--------------------------------------------
Xxxx X. Xxxxxxx, Senior Vice President
and Chief Financial Officer
Address: 0000 Xxxxxxxxxx
Xxxxxxxxxx, Xxxxx 00000
Fax No.: (000) 000-0000
Phone No.: (000) 000-0000
Attention: General Counsel
FLORIDA PROPERTIES, INC.,
a Texas corporation
By: /s/ XXXX X. XXXXXXX
--------------------------------------------
Xxxx X. Xxxxxxx, Senior Vice President
and Chief Financial Officer
Address: 0000 Xxxxxxxxxx
Xxxxxxxxxx, Xxxxx 00000
Fax No.: (000) 000-0000
Phone No.: (000) 000-0000
Attention: General Counsel
GUARANTOR SECURITY AGREEMENT - PAGE 18
CELLSTAR GLOBAL SATELLITE SERVICE,
LTD., a Texas limited partnership
By: National Auto Center, Inc.,
its general partner
By: /s/ XXXX X. XXXXXXX
---------------------------------------
Xxxx X. Xxxxxxx, Senior Vice President
and Chief Financial Officer
Address: 0000 Xxxxxxxxxx
Xxxxxxxxxx, Xxxxx 00000
Fax No.: (000) 000-0000
Phone No.: (000) 000-0000
Attention: General Counsel
AGENT:
-----
CHASE BANK OF TEXAS,
NATIONAL ASSOCIATION (formerly known as
Texas Commerce Bank National Association),
as Agent
By: /s/ XXXXX X. XXXX
--------------------------------------------
Xxxxx X. Xxxx
Vice President
Address: 0000 Xxxx Xxxxxx, 0xx Xxxxx
Xxxxxx, Xxxxx 00000
Fax No.: (000) 000-0000
Phone No.: (000) 000-0000
Attention: Xxxxx X. Xxxx
GUARANTOR SECURITY AGREEMENT - PAGE 19
Schedule 1
Location of Inventory and Equipment
-----------------------------------
Locations of Inventory and Equipment
------------------------------------
having an aggregate Inventory value of $100,000 or more
-------------------------------------------------------
Debtor Locations
------ ---------
Cell Star Global Satellite 0000 Xxxxx Xxxx
Service, Ltd. XXX Xxxxxxx, Xxxxx 00000
0000 Xxxxxxxxxx Xx.
Xxxxxxxxxx, Xxxxx 00000
0000 Xxxxxxxxxx Xx.
Xxxxxxxxxx, Xxxxx 00000
Florida Properties, Inc. None
CellStar Telecom, Inc. None
Locations of Inventory and Equipment
------------------------------------
having an aggregate Inventory value of less than $100,000
---------------------------------------------------------
Debtor Locations
------ ---------
SCHEDULE 1, Chief Executive Offices - Solo Page
Schedule 2
Jurisdictions for Filing
UCC-1 Financing Statements
--------------------------
Debtor Jurisdiction
------ ------------
CellStar Telecom, Inc. Texas
CellStar Telecom, Inc. Delaware
Florida Properties, Inc. Texas
Florida Properties, Inc. Florida
Cellstar Global Satellite Texas
Service, Ltd.
SCHEDULE 2, Jurisdictions for Filing UCC-1 Financing Statements - Solo Page
Schedule 3
Trade Names and Previous Names
------------------------------
Debtor Trade Names Previous Names
------ ----------- --------------
None
SCHEDULE 3, Trade Names and Previous Names - Solo Page
