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EXHIBIT 10.2
SECURITY AGREEMENT
SECURITY AGREEMENT dated as of August 22, 1996 (this "Agreement"),
among Recreation Vehicle Products, Inc., a Delaware corporation (the
"Borrower"), each subsidiary of the Borrower which enters into this Agreement
after the date hereof pursuant to Section 6.12 of the Credit Agreement referred
to below (the "Subsidiary Grantors"; the Subsidiary Grantors and the Borrower
are each sometimes referred to herein as a "Grantor" and collectively as the
"Grantors"), and The Chase Manhattan Bank, a New York banking corporation, as
agent ("Agent") for (i) the lenders (the "Lenders") named in Schedules 2.01(a)
and 2.01(b) of the Credit Agreement dated as of August 22, 1996 among the
Borrower, the Guarantors at any time party thereto, the Lenders and the Agent
(as amended, modified or supplemented from time to time in accordance with its
terms, the "Credit Agreement") and (ii) itself as issuer of the Letters of
Credit and party to the Rate Agreements.
The Agent and the Lenders have agreed to extend Loans and certain
other financial accommodations, including, without limitation, the issuance of
the Letters of Credit to the Borrower pursuant to, and subject to the terms and
conditions of, the Credit Agreement. In addition, The Chase Manhattan Bank has
agreed to extend certain financial accommodations to the Borrower pursuant to
the Rate Agreements. The obligation of the Lenders to extend such Loans and of
the Agent to issue the Letters of Credit under the Credit Agreement and of The
Chase Manhattan Bank to extend such financial accommodations under the Rate
Agreements is conditioned on the execution and delivery by the Grantors of a
security agreement in the form hereof to secure the following (collectively, the
"Secured Obligations"): (i) all Obligations (such Obligations to include,
without limitation, the due and punctual payment and performance of (a) all
obligations at any time and from time to time under the Rate Agreements, (b) the
principal of and interest on the Loans, when and as due, whether at maturity, by
acceleration, upon one or more dates set for prepayment or otherwise, (c)
Indebtedness at any time and from time to time under the Letters of Credit, (d)
all obligations of the Grantors at any time and from time to time under this
Agreement and (e) all other obligations of the Borrower and the Guarantors at
any time and from time to time under the Credit Agreement and the other Loan
Documents), and (ii) all obligations of Holdings at any time and from time to
time under the Holdings Guarantee.
Accordingly, the Grantors and the Agent hereby agree as follows:
1. Definitions of Terms Used Herein. All capitalized terms used
herein but not defined herein shall have the meanings set forth in the Credit
Agreement. As used herein, the following terms shall have the following
meanings:
(a) "Accounts Receivable" shall mean (i) all of the Grantors'
present and future accounts, general intangibles, chattel paper and instruments,
as such terms are defined in the Uniform Commercial Code as in effect in the
State of New
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York ("NYUCC"), (ii) all moneys, securities and other property and the proceeds
thereof, now or hereafter held or received by, or in transit to, the Agent from
or for any Grantor, whether for safekeeping, pledge, custody, transmission,
collection or otherwise, and all of the deposits (general or special) of any
Grantor, balances, sums and credits with, and all of the Grantors' claims
against the Agent at any time existing, (iii) all of the Grantors' right, title
and interest, and all of the Grantors' rights, remedies, security and Liens, in,
to and in respect of any accounts receivable, including, without limitation,
rights of stoppage in transit, replevin, repossession and reclamation and other
rights and remedies of an unpaid vendor, lienor or secured party, guaranties or
other contracts of suretyship with respect to accounts receivable, deposits or
other security for the obligation of any account debtor, and credit and other
insurance, (iv) all of the Grantors' right, title and interest in, to and in
respect of all goods relating to, or which by sale have resulted in, accounts
receivable, including, without limitation, all goods described in invoices or
other documents or instruments with respect to, or otherwise representing or
evidencing, any account receivable, and all returned, reclaimed or repossessed
goods.
(b) "Collateral" shall mean all (i) Accounts Receivable, (ii)
Documents, (iii) Equipment, (iv) General Intangibles, (v) Inventory, (vi)
Investment Property, and (vii) Proceeds; excluding (x) all of the Borrower's
right, title and interest in and to the Coast Distribution Agreement, (y) any
property and/or rights of the Grantors in countries other than the United States
or Canada in which the grant of a security interest or mortgage would invalidate
such property or rights and (z) any property and/or rights of the Grantors
listed on Schedule II attached hereto.
(c) "Documents" shall mean all instruments, files, records,
ledger sheets and documents covering or relating to any of the Collateral.
(d) "Equipment" shall mean all of the Grantors' machinery,
equipment, vehicles, furniture and fixtures and all attachments, accessories and
equipment now or hereafter owned or acquired in the Grantors' business or used
in connection therewith, and all substitutions and replacements thereof,
wherever located, whether now owned or hereafter acquired by any Grantor.
(e) "General Intangibles" shall mean all of the Grantors'
present and future general intangibles of every kind and description, including
(without limitation) patents, patent applications, trade names and trademarks
and the goodwill of the business symbolized thereby, Federal, State and local
tax refund claims of all kinds.
(f) "Inventory" shall mean all of the Grantors' right, title
and interest in and to raw materials, work in process, finished goods and all
other inventory (as such term is defined in the NYUCC), whether now owned or
hereafter acquired, and all wrapping, packaging, advertising and shipping
materials, and any documents relating thereto.
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(g) "Investment Property" shall mean all of the Grantors'
right, title and interest in and to all present and future securities, security
entitlements and securities accounts.
(h) "Proceeds" shall mean any consideration received from the
sale, exchange, lease or other disposition of any asset or property which
constitutes Collateral, any other value received as a consequence of the
possession of any Collateral and any payment received from any insurer or other
person or entity as a result of the destruction, loss, theft or other
involuntary conversion of whatever nature of any asset or property that
constitutes Collateral, and shall include, without limitation, all cash and
negotiable instruments received or held by any of the Lenders pursuant to any
lockbox or similar arrangement relating to the payment of Accounts Receivable.
2. Security Interests. As security for the payment or performance,
as the case may be, of the Secured Obligations, the Grantors hereby create and
grant to the Agent, its successors and its assigns, for its own benefit and for
the pro rata benefit of the Lenders, their successors and their assigns, a
security interest in the Collateral (the "Security Interest"). Without limiting
the foregoing, the Agent is hereby authorized to file one or more financing
statements, continuation statements or other documents for the purpose of
perfecting, confirming, continuing, enforcing or protecting the Security
Interest, naming the Grantors as debtors and the Agent as secured party, except
as otherwise provided under the Security Agreement - Patents and Trademarks.
The Grantors agree at all times to keep in all material respects
accurate and complete accounting records with respect to the Collateral,
including, but not limited to, a record of all payments and Proceeds received.
3. Further Assurances. Each Grantor agrees, at its expense, to
execute, acknowledge, deliver and cause to be duly filed all such further
instruments and documents and take all such actions as the Agent may from time
to time reasonably request for the assuring and preserving of the Security
Interest (except as otherwise provided under the Security Agreement - Patents
and Trademarks) and the rights and remedies created hereby, including, without
limitation, the payment of any fees and taxes required in connection with the
execution and delivery of this Agreement, the granting of the Security Interest
and the filing of any financing statements or other documents in connection
herewith. If any amount payable under or in connection with any of the
Collateral shall be or become evidenced by any promissory note or other
instrument, such note or instrument shall be promptly pledged and delivered to
the Agent, duly endorsed in a manner satisfactory to the Agent. Each Grantor
agrees to notify promptly the Agent of any change in its corporate name or in
the location of its chief executive office, its chief place of business or the
office where it keeps its records relating to the Accounts Receivable owned by
it and the location of any Collateral. Each Grantor agrees promptly to notify
the Agent if any material portion of the Collateral is damaged or destroyed.
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4. Inspection and Verification. Subject to the provisions of Section
6.08 of the Credit Agreement, the Agent and such persons as the Agent may
designate shall have the right, at any reasonable time or times during a
Grantor's usual business hours, and upon reasonable notice (which may be
telephonic), to inspect the Collateral owned by such Grantor, all records
related thereto (and to make extracts and copies from such records), and the
premises upon which any such Collateral is located, to discuss such Grantor's
affairs with the officers of such Grantor and its independent accountants and to
verify under reasonable procedures the validity, amount, quality, quantity,
value, and condition of or any other matter relating to, such Collateral,
including, upon the occurrence and continuance of an Event of Default, in the
case of Accounts Receivable or Collateral in the possession of a third person,
contacting account debtors and third persons possessing such Collateral. Subject
to the provisions of Section 11.11 of the Credit Agreement, the Agent shall have
the absolute right to share any information it gains from such inspection or
verification with any or all of the Lenders.
5. Taxes; Encumbrances. At its option, the Agent may discharge past
due taxes, liens, security interests or other encumbrances at any time levied or
placed on the Collateral and not permitted under the Credit Agreement, and may
pay for the maintenance and preservation of the Collateral to the extent a
Grantor fails to do so as required by the Credit Agreement, and each Grantor
agrees to reimburse the Agent on demand for any payment made or any expense
incurred by it pursuant to the foregoing authorization; provided, however, that
nothing in this Section 5 shall be interpreted as excusing a Grantor from the
performance of any covenants or other promises with respect to taxes, liens,
security interests or other encumbrances and maintenances as set forth herein or
in the Credit Agreement.
6. Assignment of Security Interest. If at any time a Grantor shall
take and perfect a security interest in any property of an account debtor or any
other person to secure payment and performance of an Account Receivable, such
Grantor shall promptly assign such security interest to the Agent. Such
assignment need not be filed of public record unless necessary to continue the
perfected status of the security interest against creditors of and transferees
from the account debtor or other person granting the security interest.
7. Representations and Warranties. Each Grantor represents and
warrants to the Agent that:
(a) Title and Authority. It has (i) rights in and good title
to the Collateral in which it is granting a security interest hereunder and (ii)
the requisite power and authority to grant to the Agent the Security Interest in
such Collateral pursuant hereto and to execute, deliver and perform its
obligations in accordance with the terms of this Agreement, without the consent
or approval of any other person other than any consent or approval which has
been obtained.
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(b) Filing. Fully executed Uniform Commercial Code financing
statements containing a description of the Collateral shall have been, or shall
be delivered to the Agent in a form such that they can be, filed of record in
every govern mental, municipal or other office in every jurisdiction in which
any portion of the Collateral is located necessary to publish notice of and
protect the validity of and to establish a valid, legal and perfected security
interest in favor of the Agent in respect of the Collateral in which a security
interest may be perfected by filing in the United States and its territories and
possessions, and no further or subsequent filing, refiling, recording,
rerecording, registration or reregistration is necessary in any such
jurisdiction, except as provided under applicable law with respect to the filing
of Uniform Commercial Code continuation statements.
(c) Validity of Security Interest. The Security Interest
constitutes a valid, legal and perfected first priority security interest in all
of the Collateral for payment and performance of the Secured Obligations, except
as otherwise permitted under the Credit Agreement or under the Security
Agreement Patents and Trademarks.
(d) Information Regarding Names. To the best of its knowledge,
it has disclosed in writing to the Agent any trade names used to identify it in
its business or in the ownership of its properties.
(e) Absence of Other Liens. The Collateral is owned by it free
and clear of any Lien of any nature whatsoever, except as granted pursuant to
this Agreement and as permitted by the Credit Agreement, and, except as provided
by paragraph (b) of this Section 7, no financing statement has been filed, under
the Uni form Commercial Code as in effect in any state or otherwise, covering
any Collateral except as indicated on Schedule 7.01 to the Credit Agreement and
except where releases have been delivered to the Agent.
(f) Additional Representations for Accounts Receivable. (i)
All representations and warranties with respect to the Receivables contained in
Article X of the Credit Agreement are hereby incorporated herein in their
entirety and shall be deemed made by the Grantors hereunder as if set forth at
length herein.
(ii) Each Account Receivable arising after the Closing Date
shall be on the date of its creation a good and valid account representing an
undisputed bona fide indebtedness incurred or an amount indisputably owed by the
Customer therein named, for a fixed sum, to the extent, set forth in the invoice
relating thereto, with respect to an absolute sale and delivery upon the
specified terms of goods sold by such Grantor, or work, labor and/or services
theretofore rendered by such Grantor; no such Account Receivable is or shall at
any time be subject to any defense, offset, counterclaim, discount or allowance
except as may be stated in the invoice relating thereto or discounts and
allowances as may be customary in such Grantor's business, and such Grantor has
no reason to believe such Accounts Receivable will not be paid when due; none of
the transactions underlying or giving rise to any such Account
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Receivable shall violate any applicable State or Federal laws or regulations,
and all documents relating to any such Account Receivable shall be legally
sufficient under such laws or regulations and are legally enforceable in
accordance with their terms; to the best knowledge of such Grantor, each
customer, guarantor or endorser is solvent and will continue to be fully able to
pay all such Accounts Receivable on which it is obligated in full when due; no
agreement under which any deduction or offset of any kind, other than normal
trade discounts and discounts granted by a Grantor in the ordinary course of its
business in accordance with its historical practices, have been granted by such
Grantor, at or before the time such Account Receivable was created; all
documents and agreements relating to such Accounts Receivable shall be true and
correct and in all respects what they purport to be; to the best of each
Grantor's knowledge, all signatures and endorsements that appear on all
documents and agreements relating to such Accounts Receivable are genuine and
all signatories and endorsers shall have full capacity to contract.
(g) Survival of Representations and Warranties. All
representations and warranties of the Grantors contained in this Agreement shall
survive the execution, delivery and performance of this Agreement until the
termination of this Agreement pursuant to Section 28.
8. Records of Accounts Receivable. Each Grantor shall keep or cause
to be kept records of its Accounts Receivable which are accurate in all material
respects. In addition, each Grantor will provide the Agent with such further
schedules and/or information respecting each Account Receivable as the Agent may
reasonably require.
9. Supplemental Documentation. In connection with the execution and
delivery of this Agreement, each Grantor shall furnish or cause to be furnished
to the Agent on or prior to the Closing Date a certificate, signed by a
Responsible Officer of such Grantor dated the Closing Date, certifying that, as
of the date of such certificate, all representations and warranties of such
Grantor in Section 7 are true and correct and that such Grantor is in compliance
with all conditions, agreements and covenants to be observed or performed
hereunder.
10. Protection of Security. Each Grantor shall, at its own cost and
expense, take any and all actions reasonably necessary to defend title to the
Collateral owned by it against all persons and to defend the Security Interest
of the Agent in such Collateral, and the priority thereof, against any adverse
mortgage, pledge, security interest, Lien, charge or other encumbrance of any
nature whatsoever except for Liens permitted pursuant to Section 7.01 of the
Credit Agreement.
11. Continuing Obligations of the Grantors. Each Grantor shall
remain liable to observe and perform all the conditions and obligations to be
observed and performed by it under each contract, agreement, interest or
obligation relating to the Collateral, all in accordance with the terms and
conditions thereof, and shall indemnify and hold harmless the Agent, and the
Lenders from any and all such liabilities.
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12. Use and Disposition of Collateral. Except as set forth in Sec
tion 7.19 of the Credit Agreement, no Grantor shall make or permit to be made
any assignment, pledge or hypothecation of the Collateral, or grant any security
interest in the Collateral except for the Security Interest. No Grantor shall
make or permit to be made any transfer of any Collateral, except Inventory in
the ordinary course of business and as otherwise permitted by the Credit
Agreement, and each Grantor shall remain at all times in possession of the
Collateral owned by it other than transfers to the Agent pursuant to the
provisions hereof and as otherwise provided in this Agreement or the Credit
Agreement.
13. Limitation on Modifications of Accounts Receivable. No Grantor
will, without the Agent's prior written consent, grant any extension of the time
of payment of any of its Accounts Receivable, compromise, or settle the same for
less than the full amount thereof, release, in whole or in part, any person or
property liable for the payment thereof, or allow any credit or discount
whatsoever thereon, except, prior to the occurrence and continuance of an Event
of Default, extensions, credits, discounts, compromises or settlements granted
or made in the ordinary course of business.
14. Collections. The provisions of Article X of the Credit Agreement
with respect to the collection of the Receivables and the management of the
Collateral are hereby incorporated herein in their entirety and shall be binding
on the Grantors as if set forth at length herein.
15. Remedies upon Default. Upon the occurrence and during the
continuance of an Event of Default, each Grantor agrees to deliver each item of
Collateral to the Agent on demand, and it is agreed that the Agent shall have
the right to take any or all of the following actions at the same or different
times: with or without legal process and with or without previous notice or
demand for performance, to take possession of the Collateral and without
liability for trespass (except for actual damage caused by the Agent's gross
negligence or willful misconduct) to enter any premises where the Collateral may
be located for the purpose of taking possession of or removing the Collateral
and, generally, to exercise any and all rights afforded to a secured party
under, and subject to its obligations contained in, the Uniform Commercial Code
as in effect in any state or other applicable law. Without limiting the
generality of the foregoing, each Grantor agrees that the Agent shall have the
right, subject to the mandatory requirements of applicable law, to sell or
otherwise dispose of all or any part of the Collateral, at public or private
sale or at any broker's board or on any securities exchange, for cash, upon
credit or for future delivery as the Agent shall deem appropriate. Each such
purchaser at any such sale shall hold the property sold absolutely free from any
claim or right on the part of the applicable Grantor, and such Grantor hereby
waives (to the extent permitted by law) all rights of redemption, stay and
appraisal which such Grantor now has or may at any time in the future have under
any rule of law or statute now existing or hereafter enacted.
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The Agent shall give the applicable Grantor 10 days' written notice
(which each Grantor agrees is reasonable notice within the meaning of Section
9-504(3) of the NYUCC) of the Agent's intention to make any sale of Collateral.
Such notice, in the case of a public sale, shall state the time and place for
such sale and, in the case of a sale at a broker's board or on a securities
exchange, shall state the board or exchange at which such sale is to be made and
the day on which the Collateral, or portion thereof, will first be offered for
sale at such board or exchange. Any such public sale shall be held at such time
or times within ordinary business hours and at such place or places as the Agent
may fix and state in the notice (if any) of such sale. At any such sale, the
Collateral, or portion thereof, to be sold may be sold in one lot as an entirety
or in separate parcels, as the Agent may (in its sole and absolute discretion)
determine. The Agent shall not be obligated to make any sale of any Collateral
if it shall determine not to do so, regardless of the fact that notice of sale
of such Collateral shall 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. In case any sale of all or any part of the
Collateral is made on credit or for future delivery, the Collateral so sold may
be retained by the Agent until the sale price is paid by the purchaser or
purchasers thereof, but the Agent shall not incur any liability in case any such
purchaser or purchasers shall fail to take up and pay for the Collateral so sold
and, in case of any such failure, such Collateral may be sold again upon like
notice. At any public sale made pursuant to this Section 15, The Chase Manhattan
Bank or any Lender may bid for or purchase, free (to the extent permitted by
law) from any right of redemption, stay or appraisal on the part of any Grantor
(all said rights being also hereby waived and released to the extent permitted
by law), with respect to the Collateral or any part thereof offered for sale and
The Chase Manhattan Bank or any such Lender may make payment on account thereof
by using any claim then due and payable to The Chase Manhattan Bank or any such
Lender from such Grantor as a credit against the purchase price, and The Chase
Manhattan Bank or any such Lender may, upon compliance with the terms of sale,
hold, retain and dispose of such property without further accountability to such
Grantor therefor. For purposes hereof, a written agreement to purchase the
Collateral or any portion thereof shall be treated as a sale thereof; the Agent
shall be free to carry out such sale and purchase pursuant to such agreement,
and no Grantor shall be entitled to the return of the Collateral or any portion
thereof subject thereto, notwithstanding the fact that after the Agent shall
have entered into such an agreement all Events of Default shall have been
remedied and the Secured Obligations paid in full and/or the Total Commitment
shall have been terminated. As an alternative to exercising the power of sale
herein conferred upon it, the Agent may proceed by a suit or suits at law or in
equity to foreclose this Agreement and to sell the Collateral or any portion
thereof pursuant to a judgment or decree of a court or courts having competent
jurisdiction or pursuant to a proceeding by a court-appointed receiver.
16. Application of Proceeds. The proceeds of any collection or sale
of Collateral, as well as any Collateral consisting of cash, shall be applied by
the Agent as follows:
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FIRST, to the Agent to reimburse the Agent for that portion of
the payments, if any, made by it with respect to Letters of Credit for which a
Lender, as a participant in such Letter of Credit pursuant to Section 2.18 of
the Credit Agreement, failed to pay its pro rata share thereof as required
pursuant to such Section 2.18;
SECOND, to the payment of all reasonable costs and expenses
incurred by the Agent in connection with such collection or sale or otherwise in
connection with this Agreement or any of the Secured Obligations, including, but
not limited to, all court costs and the reasonable fees and expenses of its
agents and legal counsel, the repayment of all advances made by the Agent
hereunder on behalf of the Grantors and any other reasonable costs or expenses
incurred in connection with the exercise of any right or remedy hereunder;
THIRD, to the Agent to be held as cash collateral to the
extent of the undrawn amounts, if any, of outstanding Letters of Credit;
FOURTH, pro rata to the payment in full of (i) principal and
interest in respect of any Loans outstanding (pro rata as among the Lenders in
accordance with the amounts of the Loans made by them pursuant to the Credit
Agreement) and (ii) all unpaid monetary obligations of any Grantor to The Chase
Manhattan Bank under the Rate Agreements;
FIFTH, pro rata to the payment in full of all Secured
Obligations (other than those referred to above) owed to the Lenders (pro rata
as among the Lenders in accordance with their respective Commitments); and
SIXTH, to the Grantors, their successors and assigns, or as a
court of competent jurisdiction may otherwise direct.
Upon any sale of the Collateral by the Agent (including, without limitation,
pursuant to a power of sale granted by statute or under a judicial proceeding),
the receipt of the Agent or of the officer making the sale shall be a sufficient
discharge to the purchaser or purchasers of the Collateral so sold and such
purchaser or purchasers shall not be obligated to see to the application of any
part of the purchase money paid over to the Agent or such officer or be
answerable in any way for the misapplication thereof.
17. Locations of Collateral; Place of Business. (a) Each Grantor
hereby represents and warrants that all the Collateral is located at the
locations listed on Schedule I hereto. The Grantors agree not to establish, or
permit to be established, any other location for Collateral unless all filings
under the Uniform Commercial Code as in effect in any state or otherwise which
are required by this Agreement or the Credit Agreement to be made with respect
to the Collateral have been made and the Agent has a valid, legal and perfected
first priority security interest in the Collateral.
(b) Each Grantor confirms that its chief executive office is
located as indicated on Schedule I hereto. Each Grantor agrees not to change, or
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permit to be changed, the location of its chief executive office unless all
filings under the Uniform Commercial Code or otherwise which are required by
this Agreement or the Credit Agreement to be made have been made and the Agent
has a valid, legal and perfected first priority security interest.
18. Security Interest Absolute. All rights of the Agent hereunder,
the Security Interest, and all obligations of the Grantors hereunder, shall be
absolute and unconditional irrespective of (i) any lack of validity or
enforceability of the Credit Agreement, any other Loan Document, any other
agreement with respect to any of the Secured Obligations or any other agreement
or instrument relating to any of the foregoing, (ii) any change in the time,
manner or place of payment of, or in any other term of, all or any of the
Secured Obligations, or any other amendment or waiver of or consent to any
departure from the Credit Agreement, any other Loan Document or any other
agreement or instrument, (iii) any exchange, release or nonperfection of any
other Collateral, or any release or amendment or waiver of or consent to or
departure from any guarantee, for all or any of the Secured Obligations, or (iv)
any other circumstance which might otherwise constitute a defense available to,
or discharge of, the Grantors, any of the Guarantors or any other obligor in
respect of the Secured Obligations or in respect of this Agreement.
19. No Waiver. No failure on the part of the Agent to exercise, and
no delay in exercising, any right, power or remedy hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any such right,
power or remedy by the Agent preclude any other or further exercise thereof or
the exercise of any other right, power or remedy. All remedies hereunder are
cumulative and are not exclusive of any other remedies provided by law. The
Agent and the Lenders shall not be deemed to have waived any rights hereunder or
under any other agreement or instrument unless such waiver shall be in writing
and signed by such parties.
20. Agent Appointed Attorney-in-Fact. Each Grantor hereby appoints
the Agent the attorney-in-fact of such Grantor solely for the purpose of
carrying out the provisions of this Agreement and taking any action and
executing any instrument which the Agent may deem necessary or advisable to
accomplish the purposes hereof, which appointment is irrevocable and coupled
with an interest.
21. Agent's Fees and Expenses. The Grantors shall be jointly and
severally obligated to, upon demand, pay to the Agent the amount of any and all
reasonable expenses, including the reasonable fees and expenses of its counsel
and of any experts or agents which the Agent may incur in connection with (i)
the administration of this Agreement, (ii) the custody or preservation of, or
the sale of, collection from, or other realization upon, any of the Collateral,
(iii) the exercise or enforcement of any of the rights of the Agent hereunder,
or (iv) the failure of any representation or warranty of a Grantor hereunder to
be true and correct in all material respects or the failure by any Grantor to
perform or observe any of the provisions hereof. In addition, the Grantors
jointly and severally indemnify and hold the Agent and the Lenders harmless from
and against any and all liability incurred by the Agent or the
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Lenders hereunder or in connection herewith, unless such liability shall be due
to the gross negligence or willful misconduct of the Agent or the Lenders, as
the case may be. Any such amounts payable as provided hereunder or thereunder
shall be additional Secured Obligations secured hereby and by the other Security
Documents.
22. Binding Agreement; Assignments. This Agreement, and the terms,
covenants and conditions hereof, shall be binding upon and inure to the benefit
of the parties hereto and their respective successors and assigns, except that
the Grantors shall not be permitted to assign this Agreement or any interest
herein or in the Collateral, or any part thereof, or any cash or property held
by the Agent as Collateral under this Agreement, except as contemplated by this
Agreement or the Credit Agreement.
23. Governing Law. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE
WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, EXCEPT TO THE EXTENT
THAT THE VALIDITY OR PERFECTION OF THE SECURITY INTEREST HEREUNDER, OR REMEDIES
HEREUNDER, IN RESPECT OF ANY PARTICULAR COLLATERAL ARE GOVERNED BY THE LAWS OF A
JURISDICTION OTHER THAN THE STATE OF NEW YORK.
24. Notices. All communications and notices hereunder shall be in
writing and given as provided in the Credit Agreement.
25. Severability. In case any one or more of the provisions
contained in this Agreement should be invalid, illegal or unenforceable the
remaining provisions contained herein shall not in any way be affected or
impaired.
26. Section Headings. Section headings used herein are for
convenience only and are not to affect the construction of, or to be taken into
consideration in interpreting, this Agreement.
27. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall constitute an original, but all of which, when
taken together, shall constitute but one instrument. This Agreement shall be
effective when a counterpart which bears the signature of the Grantors shall
have been delivered to the Agent.
28. Termination. This Agreement and the Security Interest shall
terminate when (a) all the Secured Obligations have been fully paid in cash, (b)
the Lenders have no further commitment to make any Loans under the Credit
Agreement, (c) the Agent shall have no further obligation to issue any Letters
of Credit, and (d) The Chase Manhattan Bank has no further obligation to extend
financial accommodations under any Rate Agreement, at which time the Agent shall
execute and deliver to the Grantors all Uniform Commercial Code termination
statements and similar documents which the Grantors shall reasonably request to
evidence such termination; provided, however, that all indemnities of the
Grantors contained in this Agreement shall survive,
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and remain operative and in full force and effect regardless of, the termination
of this Agreement.
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IN WITNESS WHEREOF, the parties hereto have duly executed this
Security Agreement as of the day and year first above written.
RECREATION VEHICLE PRODUCTS, INC.
By:
---------------------------------
Name:
Title:
THE CHASE MANHATTAN BANK, as Agent
By:
---------------------------------
Name:
Title:
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Schedule I to the
Security Agreement
Locations of Collateral
Chief Executive Office of each Grantor
Trade names of each Grantor
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Schedule II to the
Security Agreement
Excluded Collateral
None
