EXHIBIT 10.5
SECURITY AGREEMENT
THIS SECURITY AGREEMENT (this "Agreement"), dated as of October 31,
2008, is made by and between iPRINT TECHNOLOGIES, LLC, a Delaware limited
liability company ("Debtor") and iPRINT TECHNOLOGIES, INC., a California
corporation ("Secured Party").
RECITALS
A. Debtor has executed and delivered to Secured Party (i) that
certain Secured Contingent Promissory Note No. 1 of even
date herewith, payable to Secured Party in the original
principal amount of Five Hundred Seventy Five Thousand
Dollars ($575,000) (the "First Short-term Note"); (ii) that
certain Secured Contingent Promissory Note No. 2 of even
date herewith, payable to Secured Party in the original
principal amount of Five Hundred Seventy Five Thousand
Dollars ($575,000) (the "Second Short-term Note"); (iii)
that certain Secured Non-Contingent Promissory Note of even
date herewith, payable to Secured Party in the original
principal amount of Five Hundred Thousand Dollars
($500,000) (the "Additional Note"); and (iv) that certain
Secured Convertible Contingent Promissory Note of even date
herewith, payable to Secured Party in the original
principal amount of One Million Eight Hundred Fifty
Thousand Dollars ($1,850,000) (the "Long-term Note" and
together with the First Short-term Note, the Second Short-
term Note, and the Additional Note, individually a "Note"
and collectively, the "Notes").
B. To secure Debtor's obligations under the Notes and
Debtor's obligations under this Agreement and certain other
agreements, Debtor has agreed to grant Secured Party a
security interest as provided below.
C. This Agreement is being delivered in accordance with
that certain Asset Purchase Agreement, dated as of October
31, 2008, by and among Debtor, Secured Party, American
TonerServ Corp., a Delaware corporation ("ATS") and certain
other parties (the "Purchase Agreement").
AGREEMENT
NOW, THEREFORE, for good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereto agree as
follows:
1. Definitions. As used in this Agreement, the following
capitalized terms shall have the meanings ascribed thereto below.
Capitalized terms used herein but not otherwise defined herein shall have the
meanings ascribed thereto in the Delaware Uniform Commercial Code ("UCC") as
in effect on the date hereof.
(a) "Collateral" means the property listed on the Description
of Collateral attached hereto as Exhibit A, and all substitutions for, and
additions, improvements, and accessions thereto, and the proceeds thereof,
including proceeds acquired with cash proceeds. The Collateral comprises of
the Purchased Assets other than the Inventory and Accounts Receivable (as
such terms are defined in the Purchase Agreement).
(b) "Event of Default" means an event or condition described
in Section 6 hereof.
(c) "Obligations" means any and all debts, obligations, and
liabilities of Debtor to Secured Party arising out of, or relating in any way
to the Notes or any addendums thereto, including all future advances made
thereunder, any payment obligations of Debtor to Secured Party pursuant to
this Agreement, the Employment Agreements (as defined in the Purchase
Agreement), the Consulting Agreement (as defined in the Purchase Agreement),
and that certain side letter agreement of even date herewith, and any
performance obligations of Debtor to Secured Party pursuant to that certain
side letter agreement of even date herewith and the Buyer's Supplier Credit
Obligations (as defined in the Purchase Agreement), whether existing or
arising after the date of this Agreement; whether voluntary or involuntary;
whether or not jointly owned with others; whether direct or indirect; or
whether absolute or contingent; and whether or not from time to time
increased, decreased, extinguished, created, or incurred.
2. Creation of Security Interest. Debtor hereby grants to Secured
Party a continuing security interest in the Collateral to secure payment and
performance of the Obligations.
3. Debtor's Representations and Warranties. Debtor hereby
represents and warrants to Secured Party as follows:
(a) Organization. Debtor is a limited liability company duly
organized, validly existing, and in good standing under the laws of the State
of Delaware and has all requisite power and authority to carry on its
business as presently conducted. Debtor is duly qualified or licensed to do
business and is in good standing in each jurisdiction in which the nature of
its business or its properties makes such qualification or licensing
necessary, other than in such jurisdictions where the failure to be so
qualified or licensed would not have a material adverse effect on Debtor.
(b) Authority. Debtor has the full right, capacity, power,
and authority to execute and deliver this Agreement, to perform its
obligations hereunder and to consummate the transactions contemplated hereby.
This Agreement has been duly executed and delivered by Debtor, and assuming
due authorization, execution, and delivery by Secured Party, constitutes the
valid and legally binding obligations of Debtor enforceable in accordance
with its terms and conditions, except as may be limited (i) by applicable
bankruptcy, insolvency, reorganization, or other laws of general application
affecting creditors' rights generally or (ii) by general principles of
equity.
(c) No Conflict. The execution, delivery and performance by
Debtor of this Agreement and the consummation of the transactions
contemplated hereby will not (i) violate any statute, ordinance, regulation,
order, judgment or decree of any court or governmental agency or board; (ii)
violate, conflict with, result in any breach of, or constitute a default (or
an event that, with notice or lapse of time or both, would constitute a
default) under any contract to which Debtor is a party or by which it is
bound, or under its Certificate of Formation or Limited Liability Company
Agreement; or (iii) result in the creation of a lien against the Collateral
except that created by this Agreement.
(d) No Defenses. There are no defenses, counterclaims, or
setoffs that may be asserted against Secured Party with respect to the
Collateral or payment or performance of the Obligations, except as otherwise
provided herein or in the Notes.
(e) Title. Subject to the accuracy of Secured Party's
representations and warranties contained in the Purchase Agreement, Debtor
owns all right, title, and interest in the Collateral free and clear of all
liens, encumbrances, and security interests, except the security interest
created by this Agreement.
(f) First Priority Lien. Subject to the accuracy of Secured
Party's representations and warranties contained in the Purchase Agreement,
the liens granted to Secured Party under this Agreement will constitute a
first priority lien on the Collateral upon the filing of appropriate
financing statements and Debtor's grant of such lien to Secured Party does
not constitute a fraudulent conveyance under any applicable law.
(g) Full Disclosure. No representation, warranty or other
statement of Debtor contained herein, when taken as a whole, contains any
untrue statement of a material fact or omits to state a material fact
necessary to make the statements contained herein not misleading.
(h) No Event of Default. No Event of Default exists or
potentially exists.
4. Debtor's Covenants. Debtor hereby covenants:
(a) Pay and Perform Obligations. To pay and perform the
Obligations to Secured Party when they are due.
(b) Protection of Security Interest. To, at the request of
Secured Party, execute and deliver to Secured Party all financing statements
or other documents that Secured Party may reasonably request, in form
satisfactory to Secured Party, to perfect and continue perfecting Secured
Party's security interest in the Collateral. Secured Party shall pay all
expenses, including attorneys fees and expenses, related to the perfection
and continuation of Secured Party's security interest in the Collateral.
(c) Transactions Involving Collateral. Not to, without the
prior written consent of Secured Party, (i) sell, assign, or otherwise
transfer the Collateral except in the ordinary course of business, or (ii)
pledge, mortgage, encumber, or otherwise permit the Collateral to be subject
to any lien, except existing liens, current tax liens, and purchase money
liens.
(d) Compliance With Laws. To comply with all laws, statutes,
and regulations pertaining to the Collateral.
(e) Taxes, Assessments, and Liens. To pay when due all taxes,
assessments, and liens with regard to the Collateral. Debtor may withhold
any such payment or may elect to contest any lien if Debtor is conducting
appropriate proceedings in good faith to contest the obligation to pay and so
long as Secured Party's interest is not jeopardized.
(f) Maintain Insurance. To maintain such insurance policies
as Secured Party and Debtor mutually deem reasonably necessary or desirable
to continuously insure the Collateral against fire, theft, and other hazards
designated at any time by Secured Party, in an amount not less than all sums
secured hereby. Each such policy shall name Secured Party as an additional
insured and loss payee.
(g) Unlawful Use. Not to use the Collateral for any unlawful
purpose or in any way that would void any effective insurance.
(h) Certain Events. Not to effectuate a Change in Control (as
defined below), liquidate or dissolve. As used in this Agreement, "Change in
Control" shall mean (i) the sale of all or substantially all of the assets of
Debtor or the Business, or (ii) the closing of the acquisition of Debtor by
another entity by means of merger, consolidation, or other transaction or
series of related transactions, resulting in the exchange of the outstanding
membership interests, or the issuance of additional membership interests,
such that the members of Debtor prior to such transaction own, directly or
indirectly, less than fifty percent (50%) of the voting power of the
surviving entity.
5. Termination. This Agreement will continue in effect even though
from time to time there may be no outstanding Obligations under this
Agreement. The Agreement will terminate when (i) Debtor completes
performance of all Obligations, including without limitation the repayment of
all indebtedness by Debtor to Secured Party; (ii) Secured Party has no
commitment that could give rise to an Obligation; and (iii) Debtor has
notified Secured Party in writing of the termination.
6. Events of Default. Any of the following events or conditions
shall constitute an Event of Default by Debtor under this Agreement:
(a) False Representation. Any representation or warranty of
Debtor contained herein shall prove to have been false or misleading in a
material respect when made.
(b) Payment or Performance Default. A default occurs in the
payment or performance of the Obligations in accordance with the terms
thereof and such default remains uncured for ten (10) business day after
written notice thereof from Secured Party; provided, however, if the default
is with respect to payment of the Additional Note, Debtor shall only have
five (5) business days following written notice to cure.
(c) Levy. Any levy or proceeding against the Collateral or
Debtor's interest in the Collateral, except if Debtor is conducting
appropriate proceedings in good faith to contest the levy or proceeding.
(d) Damage. The Collateral is lost, stolen, or damaged.
(e) Dissolution. Debtor ceases operations, is dissolved, or
terminates its existence.
(f) Change in Control. A Change in Control has occurred.
(g) Insolvency.
(1) Voluntary Proceedings. Debtor (i) ceases or fails to
be solvent, or generally fails to pay, or admits in writing its inability to
pay, its debts as they become due, subject to applicable grace periods, if
any, whether at stated maturity or otherwise; (ii) commences any Insolvency
Proceeding (as defined below) with respect to itself; or (iii) takes any
action to effectuate or authorize any of the foregoing. As used herein
"Insolvency Proceeding" means, with respect to any person, (i) any case,
action or proceeding with respect to such person before any court or other
governmental authority relating to bankruptcy, reorganization, insolvency,
liquidation, receivership, dissolution, winding-up or relief of debtors, or
(ii) any general assignment for the benefit of creditors, composition,
marshaling of assets for creditors, or other, similar arrangement in respect
of its creditors generally or any substantial portion of its creditors;
undertaken under U.S. Federal, state or foreign law, including the Bankruptcy
Code.
(2) Involuntary Proceedings. (i) Any involuntary
insolvency proceeding is commenced or filed against Debtor or any writ,
judgment, warrant of attachment, execution or similar process, is issued or
levied against a substantial part of Debtor, and any such proceeding or
petition shall not be dismissed, or such writ, judgment, warrant of
attachment, execution or similar process shall not be released, vacated or
fully bonded within sixty (60) calendar days after commencement, filing or
levy; (ii) Debtor admits the material allegations of a petition against it in
any Insolvency Proceeding, or an order for relief (or similar order under
non-U.S. law) is ordered in any Insolvency Proceeding; or (iii) Debtor
acquiesces in the appointment of a receiver, trustee, custodian, conservator,
liquidator, mortgagee in possession (or agent therefor), or other similar
person for itself or a substantial portion of its property or business.
(h) Creditor Default. Debtor or ATS shall have received
notice of default, which default remains uncured for thirty (30) days
following notice thereof, from any commercial lender having a loan or line of
credit with a principal balance in excess of $1,000,000.
7. Remedies. On the occurrence of an Event of Default, Secured
Party may:
(a) Acceleration. Declare the Obligations immediately due and
payable without demand, presentment, protest, or notice to Debtor, all of
which Debtor expressly waives.
(b) UCC Rights. Exercise all rights and remedies available to
a secured creditor after default, including but not limited to the rights and
remedies of secured creditors under the UCC.
(c) Collateral Available. Require Debtor to take any and all
action reasonably necessary to make the Collateral available to Secured
Party.
(d) Terminate Agreements. Secured Party and the Selling
Shareholders (as defined in the Purchase Agreement) may terminate the
following agreements, in each case, in accordance with the terms and
conditions contained therein: (i) the Noncompetition Agreements (as defined
in the Purchase Agreement); (ii) the Employment Agreements (as defined in the
Purchase Agreement); (iii) the License Agreement (as defined in the Purchase
Agreement); (iv) the Consulting Agreement (as defined in the Purchase
Agreement); and (v) the Sublease Agreements (as defined in the Purchase
Agreement).
8. Nonrecourse. Notwithstanding any other provision of this
Agreement to the contrary, the Notes are nonrecourse as to Debtor. In the
event Secured Party is entitled to proceed against Debtor, its sole recourse
shall be to exercise its remedies described in Section 7 hereof, and it shall
have no other recourse against Debtor or any of its Affiliates. This
provision is not intended to constitute a discharge or release of any
obligation contained in the Notes or this Security Agreement, but is a
covenant by Secured Party not to xxx Debtor or its Affiliates for a
deficiency.
9. Miscellaneous.
(a) Further Assurances. At any time after the date of this
Agreement, upon the request of a party, the requested party agrees to
execute, acknowledge, and deliver all such further acts, deeds, assignments,
transfers, conveyances, powers of attorney, assurances, and other documents
or instruments to evidence and implement the transactions described in this
Agreement at the reasonable request and expense of the requesting party.
(b) Expenses. Except as otherwise provided herein, each party
shall pay its own costs and expenses, including, without limitation, the fees
and expenses of their respective legal counsel and financial advisers
incidental to the execution of this Agreement and the consummation of the
transactions contemplated hereby.
(c) Notice. Any notice required or permitted under this
Agreement shall be given in writing and delivered as described herein. A
notice shall be deemed effectively given as follows: (i) upon personal
delivery; (ii) one (1) business day after transmission by electronic means,
provided such transmission is electronically confirmed as having been
successfully transmitted and a copy of such notice is deposited within 24
hours for either overnight delivery or for registered or certified mail, in
accordance with clause (iii) or (iv) below, respectively; (iii) one (1)
business day after deposit with a reputable overnight courier service,
prepaid for overnight delivery; or (iv) three (3) business days after deposit
with the United States Postal Service, postage prepaid, registered or
certified with return receipt requested. Addresses for notice shall be as
follows, or at such other address as such party may designate by ten (10)
days' advance written notice to the other parties:
If to Secured Party:
iPrint Technologies, Inc.
000 Xxxxxxxx Xxxxxx, Xxxxx 0
Xxxxxxxx, XX 00000
Attn: Xxxx Xxxxxx
Fax: (000) 000-0000
With a copy, which shall not constitute notice but shall be delivered at the
same time and by the same means, to:
Xxxx & Xxxxxxxx, LLP
00 Xxxxxx Xxxx, 0xx Xxxxx
Xxx Xxxxxxxxx, Xx 00000
Attn: Xxxxx X. Xxxx, Esq.
Fax: (000) 000-0000
If to Debtor:
iPrint Technologies, LLC
c/o American TonerServ Corp.
000 Xxxxxxxx Xxxx., Xxxxx 000
Xxxxx Xxxx, XX 00000
Attn: Xxxxxx X. Xxxxxxx, President and CEO
Fax: (000) 000-0000
With a copy, which shall not constitute notice, to:
Xxxxxxxxx XxXxxxxxxx & Xxxxxx LLP
00 Xxxxx X Xxxxxx, Xxxxx 000
Xxxxx Xxxx, XX 00000
Attn: Xxxxx X. XxXxxxxxxx or Xxxxxxx X. (DJ) Xxxxxxx
Fax: (000) 000-0000
(d) Time of Essence. Time is of the essence with respect to
the terms, covenants, and conditions contained herein.
(e) Entire Agreement. This Agreement, including any other
agreements, exhibits, and schedules to be entered into in connection with the
transactions contemplated hereby and specifically referenced in this
Agreement, constitutes and embodies the entire understanding and agreement of
the parties hereto relating to the subject matter hereof and supersedes all
prior agreements or understandings of the parties hereto, whether written or
oral.
(f) Construction. Every covenant, term, and provision of
this Agreement shall be construed simply according to its fair meaning and
not strictly for or against any party. Every exhibit, schedule, attachment,
or other appendix attached to this Agreement and referred to herein shall
constitute a part of this Agreement and is hereby incorporated herein by
reference. Any reference to any federal, state, local, or foreign statue or
law shall be deemed also to refer to all rules and regulations promulgated
thereunder, unless the context requires otherwise. Unless the context
clearly requires otherwise, (i) plural and singular numbers will each be
construed to include the other; (ii) the masculine, feminine, and neuter
genders will each be construed to include the others; (iii) "shall," "will,"
"must," "agree," and "covenants" are each mandatory; (iv) "may" is
permissive; (v) "or" is not exclusive; (vi) "includes" and "including" are
not limiting; and (vii) " knowledge" will mean knowledge after due inquiry.
(g) Amendments and Waivers. Any term of this Agreement may
be amended and the observance of any term of this Agreement may be waived
(either generally or in a particular instance and either retroactively or
prospectively), but only with the written consent of the party or parties to
be bound thereby. No delay in the exercise of any right or remedy under this
Agreement shall constitute a waiver thereof and the waiver by any party of
any right or remedy under this Agreement on any one occasion shall not be
deemed a waiver of such right or remedy on any subsequent occasion.
(h) Successors and Assigns. Except as otherwise provided
herein, the terms and conditions of this Agreement shall inure to the benefit
of and be binding upon the parties and their respective heirs, executors,
administrators, legal representatives, successors, and assigns.
(i) No Third Party Beneficiaries. Except as expressly
provided herein, nothing in this Agreement, express or implied, is intended
to confer upon any party other than the parties hereto, or their respective
successors and assigns, any rights, remedies, obligations, or liabilities
under or by reason of this Agreement.
(j) Headings. The titles and subtitles used in this
Agreement are used for convenience only and shall not be considered in
construing or interpreting this Agreement.
(k) Governing Law. This Agreement shall be governed by and
construed under the laws of the State of California without regard to the
conflict of laws rules of such state.
(l) Jurisdiction. Any suit, action or proceeding seeking to
enforce any provision of, or based on any matter arising out of or in
connection with, this Agreement or the transactions contemplated hereby may
be brought in any court of competent jurisdiction in Sonoma County,
California, and each of the parties hereby consents to the jurisdiction of
such courts (and of the appropriate appellate courts therefrom) in any such
suit, action or proceeding and irrevocably waives, to the full extent
permitted by law, any objection that it may now or hereafter have to the
laying of the venue of any such suit, action or proceeding in any such court
or that any such suit, action or proceeding that is brought in any such court
has been brought in an inconvenient form. Process in any such suit, action
or proceeding may be served on any party anywhere in the world, whether
within or without the jurisdiction of any such court.
(m) Severability. Whenever possible, each provision of this
Agreement shall be interpreted in such a manner as to be effective and valid
under applicable law, but if any provision of this Agreement shall be or
become prohibited or invalid under applicable law, such provision shall be
ineffective to the extent of such prohibition or invalidity without
invalidating the remainder of such provision or the remaining provisions of
this Agreement.
(n) Specific Performance. Each party's obligation under this
Agreement is unique. If any party should default in such party's obligations
under this Agreement, each party acknowledges that it would be extremely
impracticable to measure the resulting damages; accordingly, the
nondefaulting party or parties, in addition to damages and any other
available rights or remedies, may xxx in equity for specific performance, and
the parties hereby expressly waive the defense that a remedy in damages shall
be adequate. The parties also hereby expressly waive any requirement that
the nondefaulting party or parties post a bond or similar security prior to
obtaining and enforcing any specific performance.
(o) Attorneys' Fees. If any legal action or other
proceeding, including arbitration or action for declaratory relief, is
brought for the enforcement of this Agreement or because of an alleged
dispute, breach, default, or misrepresentation in connection with this
Agreement, the Prevailing Party shall be entitled to recover reasonable
attorneys' fees and other costs, in addition to any other relief to which the
party may be entitled. As used in this Agreement, "Prevailing Party" shall
include without limitation: (i) the party who dismisses an action in
exchange for sums allegedly due; (ii) the party who receives performance from
the other party of an alleged breach of covenant of a desired remedy where
that is substantially equal to the relief sought in an action; or (iii) the
party determined to be the prevailing party by a court of law or arbitrator.
(p) Counterparts and Signature Pages. This Agreement may be
executed in any number of counterparts, each of which shall be deemed to be
one and the same instrument. The exchange of copies of this Agreement and of
signature pages by facsimile or other electronic transmission shall
constitute effective execution and delivery of this Agreement as to the
parties and may be used in lieu of the original Agreement for all purposes.
Signatures of the parties transmitted by facsimile or other electronic means
shall be deemed to be their original signatures for all purposes.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF the parties have executed this Security Agreement on the
day and year first above written.
DEBTOR:
iPRINT TECHNOLOGIES, LLC,
a Delaware limited liability company
By: AMERICAN TONERSERV CORP.,
a Delaware corporation
Its: Managing Member
By: /s/ Xxxxxx X. Xxxxxxx
Xxxxxx X. Xxxxxxx
Its: President and CEO
SECURED PARTY:
iPRINT TECHNOLOGIES, INC.,
a California corporation
By: /s/ Xxxx Xxxxxx
Xxxx Xxxxxx
Its: President and Secretary
Exhibits
A - Description of Collateral
EXHIBIT A
DESCRIPTION OF COLLATERAL
The Collateral secured by the Security Agreement comprise the Secured Assets,
as defined in that certain Asset Purchase Agreement, dated as of October 31,
2008, by and among Debtor, Secured Party, and certain other parties (the
"Purchase Agreement"), as more specifically described below. In no event
shall the Inventory or Accounts Receivable be deemed to be part of the
Collateral.
1. Equipment. The furniture, fixtures, equipment, motor vehicles,
machines, tools, inventory, supplies, leasehold improvements, trade fixtures,
and other tangible assets which were owned by Secured Party and used
primarily or exclusively in Secured Party's operation of the Business as of
the Closing Date (collectively, "Equipment"), including, without limitation,
the Equipment set forth on the Schedule of Equipment attached hereto as
Schedule A-1. Without limiting the generality of the foregoing, the
Equipment shall include the following: (i) the office furniture, computers,
printers, copiers, fax machines, and other equipment used in the operation of
the Business; (ii) the equipment, computers, hand-held computers, mobile
phones, and tools normally carried on the service trucks; (iii) the entire
fleet of vehicles (service trucks, vans and other vehicles), including,
without limitation, the vehicles set forth on the schedule of vehicles
included in the Schedule of Equipment, but excluding the 2007 Cadillac
Escalade ESV described in Section 3 of the Purchase Agreement; (iv) the
technicians' and other truck-based service equipment; (v) the printers rented
or borrowed, or intended to be rented or borrowed, by customers of the
Business.
2. Customers and Goodwill. All rights to solicit and service
Secured Party's customers and potential customers of the Business as of the
Closing Date, together with all goodwill related thereto, and all lists,
records, files, marketing materials, and billing histories associated
therewith.
3. Telephone and Facsimile Numbers. All of Secured Party's
assignable rights to the telephone number(s) and the facsimile number(s) of
the Business as of the Closing Date.
4. Intellectual Property. All Intellectual Property used primarily
or exclusively in Secured Party's operation of the Business as of the Closing
Date, including, without limitation, the Intellectual Property set forth in
the Schedule of Intellectual Property attached hereto as Schedule A-4.
5. Leasehold Interests. All of Secured Party's leasehold interests
(i) in personal property leased by or to Secured Party, including, without
limitation, all leases or rental agreements covering any Equipment; and (ii)
as lessee of the Premises under the Lease and any other Leased Real Property,
including any leasehold improvements located thereon.
6. Permits. All Permits to the extent assignable or transferable.
7. Contract Rights, and Other Intangible Assets. All of Secured
Party's right, title, and interest in, to, and under the Contracts,
including, without limitation, contracts with all customers, suppliers and
vendors of the Business as of the Closing Date and all warranties,
guarantees, and service contracts relating to any Equipment as of the Closing
Date.
8. Books and Records. All books and records (including all discs,
tapes, and other media-storage data and information) of the Business as of
the Closing Date, other than the organizational records of Secured Party
described in clause (ii) of Section 3 of the Purchase Agreement.
9. Other Records, Manuals and Documents. All mailing lists,
customer lists, billing histories, supplier lists, vendor data, marketing
information and procedures, sales and customer files, advertising and
promotional materials, current product material, equipment maintenance
records, warranty information, records of plant operations and the source and
disposition of materials used and produced in such plants, standard forms of
documents, manuals of operations or business procedures and other similar
procedures, and all other information of the Business as of the Closing Date.
10. Insurance Proceeds. All insurance proceeds paid or payable to
Secured Party in respect of any damage to or destruction or loss of any
assets or rights of Secured Party reflected on any of the Schedules referred
to in Section 2 of the Purchase Agreement, including any assets of Secured
Party that, as far as could reasonably be foreseen, would have been included
in the Purchased Assets but for such damage, destruction or loss.
