EXHIBIT 10.50
MASTER SECURITY AGREEMENT
dated as of December 27, 2001 ("Agreement")
THIS AGREEMENT is between General Electric Capital Corporation (together with
its successors and assigns, if any, "Secured Party") and Ariad Pharmaceuticals,
Inc. ("Debtor"). Secured Party has an office at 000 Xxxxxxx 0, Xxxxx 00,
Xxxxxxx, XX 00000. Debtor is a corporation organized and existing under the laws
of the state of Delaware. Debtor's mailing address and chief place of business
is 00 Xxxxxxxxxx Xx., Xxxxxxxxx, XX 00000.
1. CREATION OF SECURITY INTEREST.
Debtor grants to Secured Party, its successors and assigns, a security
interest in and against all property listed on any collateral schedule
now or in the future annexed to or made a part of this Agreement
("Collateral Schedule"), and in and against all additions, attachments,
accessories and accessions to such property, all substitutions,
replacements or exchanges therefor, and all insurance and/or other
proceeds thereof (all such property is individually and collectively
called the "Collateral"). This security interest is given to secure the
payment and performance of all debts, obligations and liabilities of any
kind whatsoever of Debtor to Secured Party, now existing or arising in
the future, including but not limited to the payment and performance of
certain Promissory Notes from time to time identified on any Collateral
Schedule (collectively "Notes" and each a "Note"), and any renewals,
extensions and modifications of such debts, obligations and liabilities
(such Notes, debts, obligations and liabilities are called the
"Indebtedness"). Unless otherwise provided by applicable law,
notwithstanding anything to the contrary contained in this Agreement, to
the extent that Secured Party asserts a purchase money security interest
in any items of Collateral ("PMSI Collateral"); (i) the PMSI Collateral
shall secure only that portion of the Indebtedness which has been
advanced by Secured Party to enable Debtor to purchase, or acquire rights
in or the use of such PMSI Collateral (the "PMSI Indebtedness"), and (ii)
no other Collateral shall secure the PMSI Indebtedness.
2. REPRESENTATIONS, WARRANTIES AND COVENANTS OF DEBTOR.
Debtor represents, warrants and covenants as of the date of this
Agreement and as of the date of each Collateral Schedule that:
(a) Debtor's exact legal name is as set forth in the preamble of this
Agreement and Debtor is, and will remain, duly organized, existing
and in good standing under the laws of the State set forth in the
preamble of this Agreement, has its chief executive offices at the
location specified in the preamble, and is, and will remain, duly
qualified and licensed in every jurisdiction wherever necessary to
carry on it business and operations;
(b) Debtor has adequate power and capacity to enter into, and to
perform its obligations under this Agreement, each Note and any
other documents evidencing, or given to connection with, any of
the Indebtedness (all of the foregoing are called the "Debt
Documents");
(c) This Agreement and the other Debt Documents have been duly
authorized, executed and delivered by Debtor and constitute legal,
valid and binding agreements enforceable in accordance with their
terms, except to the extent that the enforcement of remedies may
be limited under applicable bankruptcy and insolvency laws;
(d) No approval, consent or withholding of objections is required from
any governmental authority or instrumentality with respect to the
entry into, or performance by Debtor of any of the Debt Documents,
except any already obtained;
(e) The entry into and performance by, Debtor of the Debt Documents
will not (i) violate any of the organizational documents of Debtor
or any judgment order, law or regulation applicable to Debtor, or
(ii) result in any breach of or constitute a default under any
contract to which Debtor is a party, or result in the creation of
any lien, claim or encumbrance on any of Debtor's property (except
for liens in favor of Secured Party) pursuant to any indenture,
mortgage, deed of trust, bank loan, credit agreement, or other
agreement or instrument to which Debtor is a party;
(f) There are no suits or proceedings pending in court or before any
commission, board or other administrative agency against or
affecting Debtor which could, in the aggregate, have a material
adverse effect on Debtor, its business or operations, or its
ability to perform its obligations under the Debt Documents, nor
does Debtor have reason to believe that any such suits or
proceedings are threatened.
(g) All financial statements delivered to Secured Party in connection
with the indebtedness have been prepaid in accordance with
generally accepted accounting principles and since the date of the
most recent financial statement, there has been no material
adverse change in Debtor's financial condition;
(h) The Collateral is not, and will not be, used by Debtor for
personal, family or household purposes;
(i) The Collateral is, and will remain, in good condition and repair
and Debtor will not be negligent in its care and use;
(j) Debtor is, and will remain, the sole and lawful owner, and in
possession of, the Collateral, and has the sole right and lawful
authority to grant the security interest described in this
Agreement; and
(k) The Collateral is, and will remain, free and clear of all liens,
claims and encumbrances of any kind whatsoever, except for (i)
liens in favor of Secured Party, (ii) liens for taxes not yet due
or for taxes being contested in good faith and which do not
involve, in the judgment of Secured Party, any risk of the sale,
forfeiture or loss of any of the Collateral, and (iii) inchoate
materialmen's, mechanic's, repairman's and similar liens arising
by operation of law in the normal course of business for amounts
which are not delinquent (all off such liens are called "Permitted
Liens").
3. COLLATERAL
(a) Until the declaration of any default, Debtor shall remain in
possession of the Collateral; except that Secured Party shall have
the right to possess (i) any chattel paper or instrument that
constitutes a part of the Collateral, and (ii) any other
Collateral in which Secured Party's security interest may be
perfected only by possession. Secured Party may inspect any of the
Collateral during normal business hours after giving Debtor
reasonable prior notice. If Secured Party asks, Debtor will
promptly notify Secured Party in writing of the location of any
Collateral.
(b) Debtor shall (i) use the Collateral only in its trade or business,
(ii) maintain all of the Collateral in good operating order and
repair, normal wear and tear excepted, (iii) use and maintain the
Collateral only in compliance with manufacturers recommendations
and all applicable laws, and (iv) keep all of the Collateral free
and clear of all liens, claims and encumbrances (except for
Permitted Liens).
(c) Secured Party does not authorize and Debtor agrees it shall not
(i) part with possession of any of the Collateral (except to
Secured Party or for maintenance and repair), (ii) remove any of
the Collateral from the continental United States, or (iii) sell,
rent, lease, mortgage, license, grant a security interest in or
otherwise transfer or encumber (except for Permitted Liens) any of
the Collateral.
(d) Debtor shall promptly when due all taxes, license fees,
assessments and public and private charges levied or assessed on
any of the Collateral, on its use, or on this Agreement or any of
the other Debt Documents. At its option, Secured Party may
discharge taxes, liens, security interests or other encumbrances
at any time levied or placed on the Collateral and may pay for the
maintenance, insurance and preservation of the Collateral and
effect compliance with the terms of this Agreement or any of the
other Debt Documents. Debtor agrees to reimburse Secured Party, on
demand, all costs and expenses incurred by Secured Party in
connection with such payment or performance and agrees that such
reimbursement obligation shall constitute Indebtedness.
(e) Debtor shall, at all times, keep accurate and complete records of
the Collateral, and Secured Party shall have the right to inspect
and make copies of all of Debtor's books and records relating to
the Collateral during normal business hours, after giving Debtor
reasonable prior notice.
(f) Debtor agrees and acknowledges that any third person who may at
any time possess all or any portion of the Collateral shall be
deemed to hold, and shall hold, the Collateral as the agent of,
and as pledge holder for Security Party. Secured Party may at any
time give notice to any third person described in the preceding
sentence that such third person is holding the Collateral as the
agent of, and as pledge holder for, the Secured Party.
4. INSURANCE
(a) Debtor shall at all times bear the entire risk of any loss, theft,
damage to, or destruction of, any of the Collateral from any cause
whatsoever.
(b) Debtor agrees to keep the Collateral insured against loss or
damage by fire and extended coverage perils, theft, burglary, and
for any or all Collateral which are vehicles for risk of loss by
collision, and if requested by Secured Party, against such other
risks as Secured Party may reasonably require. The insurance
coverage shall be in an amount no less than the full replacement
value of the Collateral, and deductible amounts, insurers and
policies shall be acceptable to Secured Party. Debtor shall
deliver to Secured Party policies or certificates of insurance
evidencing such coverage. Each policy shall name Secured Party as
a loss payee, shall provide for coverage to Secured Party
regardless of the breach by Debtor of any warranty or
representation made therein, shall not be subject to co-insurance,
and shall provide that coverage may not be canceled or altered by
the insurer except upon thirty (30) days prior written notice to
Secured Party. Debtor appoints Secured Party as its
attorney-in-fact to make proof of loss, claim for insurance and
adjustments with insurers, and to receive payment of and execute
or endorse all documents, checks or drafts in connection with
insurance payments. Secured Party shall not act as Debtor's
attorney-in-fact unless Debtor is in default. Proceeds of
insurance shall be applied, at the option of Debtor, to repair or
replace the Collateral or to reduce any of the Indebtedness,
except that in the event of a loss of all or substantially all of
the collateral, the option will revert to the Secured Party.
5. REPORTS
(a) Debtor shall promptly notify Secured Party of (i) any change in
the name of Debtor, (ii) any change in the state of its
incorporation or registration, (iii) any relocation of its chief
executive offices, (iv) any relocation of any of the Collateral,
(v) any of the Collateral being lost, stolen, missing, destroyed,
materially damaged or worn out, or (vi) any lien, claim or
encumbrance other than Permitted Liens attaching to or being made
against any of the Collateral.
(b) Debtor will deliver to Secured Party Debtor's complete financial
statements, certified by a recognized firm of certified public
accountants, within ninety (90) days of the close of each fiscal
year of Debtor. Debtor will make available to Secured Party copies
of Debtor's quarterly financial reports certified by Debtor's
chief financial officer, within ninety (90) days after the close
of each of Debtor's fiscal quarter. Debtor will make available to
Secured Party copies of all Forms 10-K and 10-Q, if any, within 30
days after the dates on which they are filled with the Securities
and Exchange Commission. Availability will include Internet
availability and will not require other by the Debtor.
6. FURTHER ASSURANCES
(a) Debtor shall, upon request of Secured Party, furnish to Secured
Party such further information, execute and deliver to Secured
Party such documents and instruments (including, without
limitation, Uniform Commercial Code financing statements) and
shall do such other acts and things as Secured Party may at any
time reasonably request relating to the perfection or protection
of the security interest created by this Agreement or for the
purpose of carrying out the intent of this Agreement. Without
limiting the foregoing, Debtor shall cooperate and do all acts
deemed necessary or advisable by Secured Party to continue in
Secured Party a perfected first security interest in the
Collateral, and shall obtain and furnish to Secured Party and
subordinations, releases, landlord waivers, lessor waivers,
mortgagee waivers, or control agreements, and similar documents as
may be from time to time requested by, and in form and substance
satisfactory to, Secured Party.
(b) Debtor authorizes Secured Party to file a financing statements and
amendments thereto describing the Collateral and containing any
other information required by the applicable Uniform Commercial
Code. Debtor irrevocably grants to Secured Party the power to sign
Debtor's name and generally to act on behalf of Debtor to execute
and file applications for title, transfers of title, financing
statements, notices of lien and other documents pertaining to any
or all of the Collateral; this power is coupled with Secured
Party's interest in the Collateral. Debtor shall, if any
certificate of title be required or permitted by law for any of
the Collateral, obtain and promptly deliver to Secured Party such
certificate showing the lien of this Agreement with respect to the
Collateral. Debtor ratifies its prior authorization for Secured
Party to file financing statements and amendments thereto
describing the Collateral and containing any other information
required by the Uniform Commercial Code if filed prior to the date
hereof.
(c) Debtor shall indemnify and defend the Secured Party, its
successors and assigns, and their respective directors, officers
and employees, from and against all claims, actions and suits
(including, without limitation, related attorneys' fees) of any
kind whatsoever arising, directly or indirectly, in connection
with any of the Collateral.
7. DEFAULT AND REMEDIES.
(a) Debtor shall be in default under this Agreement and each of the
other Debt Documents if:
(i) Debtor breaches its obligation to pay when due any
installment or other amount due or coming due under any of
the Debt Documents;
(ii) Debtor, without the prior written consent of Secured Party,
attempts to or does sell, rent, lease, license, mortgage,
grant a security interest in, or otherwise transfer or
encumber (except for Permitted Liens) any of the
Collateral;
(iii) Debtor breaches any of its insurance obligations under
Section 4;
(iv) Debtor breaches any of its other obligations under any of
the Debt Documents and fails to cure that breach within
thirty (30) days after written notice from Secured Party:
(v) Any warranty, representation or statement made by Debtor in
any of the Debt Documents or otherwise in connection with
any of the indebtedness shall be false or misleading in any
material respect;
(vi) Any of the Collateral is subjected to attachment,
execution, levy, seizure or confiscation in any legal
proceeding or otherwise, or if any legal or administrative
proceeding is commenced against Debtor or any of the
Collateral, which in the good faith judgment of Secured
Party subjects any of the Collateral to a material risk of
attachment, execution, levy, seizure or confiscation and no
bond is posted or protective order obtained to negate such
risk;
(vii) Debtor breaches or is in default under any other agreement
between Debtor and Secured Party;
(viii) Debtor or any guarantor or other obligor for any of the
Indebtedness (collectively, "Guarantor") dissolves,
terminates its existence, becomes insolvent or ceases to do
business as a going concern;
(ix) If Debtor or any Guarantor is a natural person, Debtor or
any such Guarantor dies or becomes incompetent;
(x) A receiver is appointed for all or any part of the property
of Debtor or any Guarantor, or Debtor or any Guarantor
makes any assignment for the benefit of creditors;
(xi) Debtor or any Guarantor files a petition under any
bankruptcy, insolvency or similar law, or any such petition
is filed against Debtor or any Guarantor and is not
dismissed within forty-five (45) days; or
(xii) Debtor's improper filing of an amendment or termination
statement relating to a filed financing statement
describing the Collateral.
(b) If Debtor is in default, the Secured Party, at its option, may
declare any or all of the Indebtedness to be immediately due and
payable, without demand or notice to Debtor or any Guarantor. The
accelerated obligations and liabilities shall bear interest (both
before and after any judgment) until paid in full at the lower of
eighteen percent (18%) per annum or the maximum rate not
prohibited by applicable law.
(c) After default, Secured Party shall have all of the rights and
remedies of a Secured Party under the Uniform Commercial Code, and
under any other applicable law. Without limiting the foregoing,
Secured Party shall have the right to (i) notify any account
debtor of Debtor or any obligor on any instrument which
constitutes part of the Collateral to make payment to the Secured
Party, (ii) with or without legal process, enter any premises
where the Collateral may be and take possession of and remove the
Collateral from the premises or store it on the premises, (iii)
sell the Collateral at public or private sale, in whole or in
part, and have the right to bid and purchase at said sale, or (iv)
lease or otherwise dispose of all or part of the Collateral,
applying proceeds from such disposition to the obligations then in
default. If requested by Secured Party, Debtor shall promptly
assemble the Collateral and make it available to Secured Party at
a place to be designated by Secured Party which is reasonably
convenient to both parties. Secured Party may also render any or
all of the Collateral unusable at the Debtor's premises and may
dispose of such Collateral on such premises without liability for
rent or costs. Any notice that Secured Party is required to give
to Debtor under the Uniform Commercial Code of the time and place
of any public sale or the time after which any private sale or
other intended disposition of the Collateral is to be made shall
be deemed to constitute reasonable notice if such notice is given
to the last known address of Debtor at least five (5) days prior
to such action.
(d) Proceeds from any sale or lease or other disposition shall be
applied: first, to all costs of repossession, storage, and
disposition including without limitation attorneys', appraisers',
and auctioneers' fees; second, to discharge the obligations then
in default; third, to discharge any other Indebtedness of Debtor
to Secured Party, whether as obligor, endorser, guarantor, surety
or indemnitor; fourth, to expenses incurred in paying or settling
liens and claims against the Collateral; and lastly, to Debtor, if
there exists any surplus. Debtor shall remain fully liable for any
deficiency.
(e) Debtor agrees to pay all reasonable attorneys' fees and other
costs incurred by Secured Party in connection with the
enforcement, assertion, defense or preservation of Secured Party's
rights and remedies under this Agreement, or if prohibited by law,
such lesser sum as may be permitted. Debtor further agrees that
such fees and costs shall constitute Indebtedness.
(f) Secured Party's rights and remedies under this Agreement or
otherwise arising are cumulative and may be exercised singularly
or concurrently. Neither the failure nor any delay on the part of
the Secured Party to exercise any right, power or privilege under
this Agreement shall operate as a waiver, nor shall any single or
partial exercise of any right, power or privilege preclude any
other or further exercise of that or any other right, power or
privilege. SECURED PARTY SHALL NOT BE DEEMED TO HAVE WAIVED ANY OF
ITS RIGHTS UNDER THIS AGREEMENT OR UNDER ANY OTHER AGREEMENT,
INSTRUMENT OR PAPER SIGNED BY DEBTOR UNLESS SUCH WAIVER IS
EXPRESSED IN WRITING AND SIGNED BY SECURED PARTY. A waiver on any
one occasion shall not be construed as a bar to or waiver of any
right or remedy on any future occasion.
(g) DEBTOR AND SECURED PARTY UNCONDITIONALLY WAIVE THEIR RIGHTS TO A
JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF THIS AGREEMENT, ANY OF THE OTHER DEBT DOCUMENTS, ANY OF THE
INDEBTEDNESS SECURED HEREBY, ANY DEALINGS BETWEEN DEBTOR AND
SECURED PARTY RELATING TO THE SUBJECT MATTER OF THIS TRANSACTION
OR ANY RELATED TRANSACTIONS, AND/OR THE RELATIONSHIP THAT IS BEING
ESTABLISHED BETWEEN DEBTOR AND SECURED PARTY. THE SCOPE OF THIS
WAIVER IS INTENDED TO BE ALL ENCOMPASSING OF ANY AND ALL DISPUTES
THAT MAY BE FILED IN ANY COURT. THIS WAIVER IS IRREVOCABLE. THIS
WAIVER
MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING. THE WAIVER ALSO
SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR
MODIFICATIONS TO THIS AGREEMENT, ANY OTHER DEBT DOCUMENTS, OR TO
ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THIS TRANSACTION OR
ANY RELATED TRANSACTION. THIS AGREEMENT MAY BE FILED AS A WRITTEN
CONSENT TO A TRIAL BY THE COURT.
8. MISCELLANEOUS.
(a) This Agreement, any Note and/or any of the other Debt Documents
may be assigned, in whole or in part, by Secured Party without
notice to Debtor, and Debtor agrees not to assert against any such
assignee, or assignee's assigns, any defense set-off, recoupment
claim or counterclaim which Debtor has or may at any time have
against Secured Party for any reason whatsoever. Debtor agrees
that if Debtor receives written notice of an assignment from
Secured Party, Debtor will pay all amounts payable under any
assigned Debt Document to such assignee or as instructed by
Secured Party. Debtor also agrees to confirm in writing receipt of
the notice of assignment as may be reasonably requested by Secured
Party or assignee.
(b) All notices to be given in connection with this Agreement shall be
in writing, shall be addressed to the parties at their respective
addresses set forth in this Agreement (unless and until a
different address may be specified in a written notice to the
other party), and shall be deemed given (i) on the date of receipt
if delivered in hand or by facsimile transmission, (ii) on the
next business day after being sent by express mail, and (iii) on
the fourth business day after being sent by regular, registered or
certified mail. As used herein, the term "business day" shall mean
and include any day other than Saturdays, Sundays, or other days
on which commercial banks in New York, New York are required or
authorized to be closed.
(c) Secured Party may correct patent errors and fill in all blanks in
this Agreement or in any Collateral Schedule consistent with the
agreement of the parties.
(d) Time is of the essence of this Agreement. This Agreement shall be
binding, jointly and severally, upon all parties described as the
"Debtor" and their respective heirs, executors, representatives,
successors and assigns, and shall inure to the benefit of Secured
Party, its successors and assigns.
(e) This Agreement and its Collateral Schedules constitute the entire
agreement between the parties with respect to the subject matter
of this Agreement and supersede all prior understandings (whether
written, verbal or implied) with respect to such subject matter.
THIS AGREEMENT AND ITS COLLATERAL SCHEDULES SHALL NOT BE CHANGED
OR TERMINATED ORALLY OR BY COURSE OF CONDUCT, BUT ONLY BY A
WRITING SIGNED BY BOTH PARTIES. Section headings contained in this
Agreement have been included for convenience only, and shall not
affect the construction or interpretation of this Agreement.
(f) This Agreement shall continue in full force and effect until all
of the Indebtedness has been indefeasibly paid in full to Secured
Party or its assignee. The surrender, upon payment or otherwise,
of any Note or any of the other documents evidencing any of the
Indebtedness shall not affect the right of Secured Party to retain
the Collateral for such other Indebtedness as may then exist or as
it may be reasonably contemplated will exist in the future. This
Agreement shall automatically be reinstated if Secured Party is
ever required to return or
restore the payment of all or any portion of the Indebtedness (all
as though such payment had never been made).
(g) THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL IN ALL RESPECTS BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF CONNECTICUT
(WITHOUT REGARD TO THE CONFLICT OF LAWS PRINCIPLES OF SUCH STATE),
INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE,
REGARDLESS OF THE LOCATION OF THE EQUIPMENT.
IN WITNESS WHEREOF, Debtor and Secured Party, intending to be legally bound
hereby, have duly executed this Agreement in one or more counterparts, each of
which shall be deemed to be an original, as of the day and year first aforesaid.
SECURED PARTY: DEBTOR:
General Electric Capital Corporation ARIAD Pharmaceuticals, Inc.
By: /s/ Xxxx Xxxx By: /s/ Xxxxx X. Xxxxxx
------------------------------- --------------------------------------
Name: Xxxx Xxxx Name: Xxxxx X. Xxxxxx
Title: SVP Title: Interim Chief Financial Officer
