SECURITY AGREEMENT
Exhibit
10.5
THIS
SECURITY AGREEMENT (the “Agreement”), made this ___ day of ____________, 2007,
is by and between BUILDING PARTNERS, INC., a Delaware corporation with executive
offices at 00 Xxxx Xxxxxx, Xxxxxxxxx, Xxx Xxxxxxxxx 00000 (the “Debtor”), and TD
BANKNORTH, N. A., a national banking association with a business address of
0
Xxxxxxxx Xxxx Xxxxx, Xxxxxxx, Xxx Xxxxxxxxx 00000 (the “Secured
Party”).
WITNESSETH:
WHEREAS,
pursuant to the Commercial Loan Agreement dated May 5, 2005 as amended to date,
(as amended, the “Loan Agreement”), Secured Party has established in favor of
Debtor’s affiliates, BRANDPARTNERS GROUP, INC., a Delaware corporation, and
BRANDPARTNERS RETAIL, INC., a New Hampshire corporation (such entities
individually, collectively, jointly, and severally under the Loan Agreement
being the “Borrower”), certain credit facilities consisting of a Revolving Line
of Credit in the principal amount of up to $5,000,000 and a Term Loan in the
principal amount of $2,000,000 (collectively, the Revolving Line of Credit
and
the Term Loan being the “Loans”), all as set forth and described in the Loan
Agreement;
WHEREAS,
pursuant to a certain Guaranty Agreement of near or even date of the Debtor
in
favor of the Secured Party (the “Guaranty”), Debtor has guaranteed full payment
and performance of all of the Obligations of the Borrower to the Secured Party
under the Loan Agreement and the Loan Documents; and
WHEREAS,
the obligation of the Secured Party to continue making the Loans to the Borrower
is subject to the condition, among others, that the Debtor shall execute and
deliver this Agreement and grant the security interests hereinafter described.
Terms not otherwise defined herein shall have the meanings ascribed to them
in
the Loan Agreement.
NOW,
THEREFORE, in consideration of the willingness of the Secured Party to continue
making the Loans to the Borrower, and for other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, the parties agree
as follows:
1.
Security
Interest.
As
security for the Secured Obligations described in Section 2 hereof, Debtor
hereby grants to the Secured Party a first priority security interest in and
lien on all of the property and assets of the Debtor, including, but not limited
to the property and assets of the types described below (hereinafter referred
to
collectively as the “Collateral”):
(a)
All
goods, including equipment, machinery, office equipment, furniture, and motor
vehicles, along with all other parts, tools, trade-ins, repairs, accessories,
accessions, modifications, and replacements, whether now owned or subsequently
acquired, constructed, or attached or added to, or placed in, the foregoing
(collectively, the “Equipment”);
(b)
All
inventory, wherever located, including goods, merchandise and other personal
property, held for sale, licensing, or lease or furnished or to be furnished
under a contract of service, or constituting raw materials, work in process
or
materials used or consumed in the Debtor's business, or consigned to others
or
held by others for return to the Debtor, whether now owned or subsequently
acquired or manufactured and wherever located (collectively, the
“Inventory”);
(c)
All
accounts and accounts receivable, including, without limitation, accounts,
contracts, contract rights, license fees, royalties, chattel paper, instruments,
rents, deposits, general intangibles, and any other obligations of any kind
whether now existing or hereafter arising out of or in connection with the
sale,
licensing or lease of goods or intangibles, the rendering of services, or the
granting of licenses, and all rights now or hereafter existing in and to all
security agreements, notes, leases, licenses, franchises, supply agreements,
and
other contracts securing or otherwise relating to any such accounts, contracts,
contract rights, chattel paper, instruments, rents, deposits, general
intangibles, or obligations (any and all such accounts, contracts, contract
rights, chattel paper, instruments, rents, deposits, general intangibles, and
obligations being the “Receivables”, and any and all such security agreements,
notes, leases, licenses, franchises, supply agreements, and other contracts
being the “Related Contracts”);
(d)
All
general intangibles, including, but not limited to, corporate names, trade
names, trademarks, trade secrets, copyrights, patents (issued and pending),
inventions, books and records, customer lists, blue prints and plans, computer
programs, tapes and related electronic data, processing software, and all
corporate ledgers;
(e)
All
investment property, including, but not limited to, securities, whether
certificated or uncertificated; securities entitlement; securities accounts;
commodity contracts; and commodity accounts;
(f)
Any
and all additions, accessions, substitutions or replacements to or for any
of
the foregoing;
(g)
Any
and all products and proceeds of any or all of the foregoing, including, without
limitation, cash, cash equivalents, tax refunds and the proceeds of insurance
policies providing coverage against the loss or destruction of or damage to
any
of the Collateral, or any indemnity, warranty, or guarantee payable by reason
of
loss or damage to or otherwise with respect to any of the Collateral (whether
or
not the Secured Party is the loss payee thereof);
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(h)
All
of the Debtor's after-acquired property of the kinds and types described in
paragraphs (a) - (g) herein;
(i)
All
records and data relating to any of the property described above, whether in
the
form of a writing, photograph, microfilm, microfiche, or electronic media,
together with all of the Debtor's right, title, and interest in and to all
computer software required to utilize, create, maintain and process any of
such
records or data or electronic media; and
also
in
(1) all checks, money, securities, bank accounts, deposit accounts, and other
accounts in the possession of or held by the Secured Party whether in the name
of the Debtor or in the name of the Secured Party, and (2) all other property
in
which a security interest is granted by the Debtor to the Secured Party pursuant
to this Agreement.
2.
Secured
Obligations.
The
security interest hereby granted shall secure the following (the “Secured
Obligations”):
(a)
Debtor’s payment and performance of all of the Guaranteed Obligations as defined
and described in the Guaranty;
(b)
Borrower’s payment of the aggregate principal sum of up to Seven Million Dollars
($7,000,000) under the Loans, together with interest, prepayment fees, and
other
charges thereon as provided in the Loan Agreement and the notes evidencing
the
Loans of near or even date made jointly and severally by Borrower payable to
the
order of the Secured Party (such notes, together with any subsequent extensions,
renewals, modifications, substitutions or replacements thereof, are hereinafter
collectively referred to as the “Note”);
(c)
The
Borrower's payment or performance of its obligations under the Loan Agreement
and under the other Loan Documents (as defined, described and identified in
the
Loan Agreement, hereinafter the “Loan Documents”), as the same may be amended,
modified, extended, renewed, replaced or restated;
(d)
The
payment of all other sums with interest and charges thereon advanced in
accordance herewith to protect the validity, security, and priority of this
Agreement, the Loan Agreement, or the Loan Documents;
(e)
Any
and all obligations of the Borrower arising under any foreign exchange
contracts, interest rate swap, cap, floor or hedging agreements, interest rate
protection products, or similar agreements with the Secured Party or any
affiliate of the Secured Party; any and all obligation of the Borrower to the
Secured Party arising under any credit cards issued by the Secured Party to
the
Borrower; and any and all obligations of the Borrower to the Secured Party
out
of or in connection with any Automated Clearing House (“ACH”) Agreements
relating to the processing of ACH transactions, together with all fees,
expenses, charges and other amounts owing by or chargeable to the Borrower
under
all such contracts, agreements, and credit cards; and
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(f)
Any
and all other indebtedness of Borrower to Secured Party of every kind and
description, direct or indirect, absolute or contingent, due or to become due,
regardless of how they arose, now existing or hereafter arising.
3.
Warranties
and Representations of the Debtor.
Debtor
hereby makes the following representations and warranties which shall survive
the execution and delivery of this Agreement and shall be continuing
representations and warranties as long as any Secured Obligation remains
outstanding:
(a)
All
representations and warranties made in the Loan Agreement and the Loan Documents
relating to the Debtor and the Collateral are true, accurate and complete in
all
material respects;
(b)
The
Debtor is organized under the laws of the State of Delaware and its principal
place of business is located at 00 Xxxx Xxxxxx, Xxxxxxxxx, Xxx Xxxxxxxxx 00000;
the Debtor's executive offices and the office where its books and records are
kept and are to be kept concerning the Receivables, Related Contracts and other
Collateral are at the aforesaid address; and the Debtor currently has no other
places of business except those set forth on Schedule I hereto and for the
previous four (4) month period Debtor has had no other places of business except
those set forth on Schedule I hereto;
(c)
Other
than as set forth on Schedule I, the Debtor conducts business only under and
through the corporate, business and trade names first set forth
above;
(d)
No
material authorization, approval or other action by, and no notice to or filing
with, any governmental authority or other person is required either (i) for
the
grant by the Debtor of the security interests granted hereby or for the
execution, delivery or performance of this Agreement by the Debtor, or (ii)
for
the perfection of or the exercise by the Secured Party of its respective rights
and remedies hereunder, except the filing of financing statements or as
previously obtained;
(e)
The
Debtor has good and marketable title to all of the Collateral pledged by it
hereunder, free and clear of any liens, security interests, encumbrances or
interests or claims of any other person or entity, except for the security
interests of the third parties as disclosed on Schedule II attached hereto
(collectively, the “Permitted Encumbrances”), which Permitted Encumbrances shall
be subject and subordinate to the security interests of the Secured Party
hereunder, and there are no sums owed with respect to the Collateral other
than
as disclosed on the Debtor's financial statements most recently delivered to
the
Secured Party;
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(f)
Upon
the filing of UCC-1 financing statements being delivered at or prior to the
execution hereof, the Secured Party will have a valid, perfected, first priority
security interest in all of the Collateral which may be perfected by filing
of
financing statements (subject only to the Permitted Encumbrances);
(g)
Schedule III attached hereto sets forth the description and location of all
Collateral of a value greater than $100,000 not located at the Debtor's
principal place of business or at the locations listed on Schedule I,
and
(h)
Except as set forth on Schedule II, no effective financing statements or other
similar instrument in effect covering all or any part of the Collateral is
on
file in any recording office, except as may have been filed in favor of Secured
Party relating to this Agreement or prior agreements with the Secured
Party.
4. Affirmative
Covenants of the Debtor.
(a)
The
Debtor shall promptly notify and provide the Secured Party with a complete
description of the opening of any new places of business containing Collateral
of a value of greater than $100,000.00, or, any change in its legal name or
place of incorporation, or any other act which would affect the financing
statements filed by the Secured Party;
(b)
Upon
the request of Secured Party, the Debtor shall take all steps that are
reasonably necessary or prudent to protect the security interests of the Secured
Party in the Collateral;
(c)
The
Debtor shall defend the Collateral against the claims and demands of all persons
which would have a Material Adverse Effect (as herein after
defined);
(d)
The
Debtor shall comply, in all material respects, with all governmental regulations
applicable to the Collateral or any part thereof or to the operation of the
Debtor's business except where failure to comply would not cause a Material
Adverse Effect; provided, however, that the Debtor may contest any governmental
regulation in any reasonable manner which shall not in the reasonable opinion
of
the Secured Party materially and adversely affect the Secured Party's rights
or
the first priority of its security interest in the Collateral (subject to
Permitted Encumbrances);
(e)
The
Debtor shall pay promptly when due, all taxes, assessments and governmental
charges or levies imposed upon the Collateral or in respect of its income or
profits therefrom, except that no such amounts need be paid if (i) the validity
thereof is being contested in good faith by appropriate proceedings, and (ii)
such amounts are adequately reserved against in accordance with the generally
accepted accounting principles;
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(f)
The
Debtor shall cause the Equipment to be maintained and preserved in reasonably
good repair and working order, normal wear and tear excepted, and shall make
all
repairs, replacements, additions, and other improvements reasonably necessary
to
maintain the Equipment in such good condition, subject to
obsolescence;
(g)
The
Debtor shall maintain Inventory reasonably sufficient to meet the needs of
its
business;
(h)
Upon
request of the Secured Party, the Debtor shall, with respect to any Collateral
required to be titled, deliver all titles thereto to the Secured Party to be
held by the Secured Party and Debtor shall make, execute, and deliver any and
all applications, and take such other action to assure that the Secured Party
is
listed of record as the first priority and sole lienholder on all title
certificates;.
(i)
Debtor shall keep materially accurate and complete records listing and
describing the Collateral, and when requested by Secured Party, Debtor shall
give Secured Party information regarding the Collateral and setting forth the
total value of the Inventory, the total value of the Equipment, the amount
of
the Receivables designating how many days the Receivables are from the date
of
invoice, the face value of any instruments, and any other information Secured
Party may reasonably request. Secured Party shall have the right, at any time
(but at reasonable intervals) during normal business hours and upon prior
notice, to inspect the Collateral and to audit and make copies of any records
or
other writings which relate to the Collateral or the general financial condition
of Debtor;
(j)
The
Debtor shall advise the Secured Party promptly, in reasonable detail, (i) of
any
lien, security interest, encumbrance, or claim made or asserted against any
of
the Collateral in an amount in excess of $100,000.00, except for Permitted
Encumbrances, (ii) of any material loss or depreciation in the value of the
Collateral taken as a whole, and (iii) of the occurrence of any other material
adverse effect on the aggregate value, enforceability or collectibility of
the
Collateral;
(k)
The
Debtor shall upon the request of the Secured Party give, execute, deliver and
file or record in the proper governmental offices, any instrument, paper or
document, including, but not limited to, one or more financing statements under
the Uniform Commercial Code, reasonably satisfactory to the Secured Party,
or
take any action which the Secured Party reasonably may request in order to
create, preserve, perfect, extend, continue, modify, terminate or otherwise
effect any security interest granted pursuant hereto, or to enable the Secured
Party to exercise or enforce any of its rights hereunder; and
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(l)
The
Debtor shall keep, and stamp or otherwise xxxx, any of its documents,
instruments and chattel paper and its books and records relating to any of
the
Collateral in such manner as the Secured Party may reasonably
require.
For
purposes of this Agreement, “Material Adverse Effect” shall mean a material (as
defined in the Loan Agreement) adverse effect on (a) the business, assets,
operations or financial or other condition of Debtor, (b) Debtor’s ability to
pay any of the Loans or any of the other Obligations in accordance with the
terms of the Loan Agreement, (c) the Collateral, taken as a whole, or the
security interests of the Secured Party in the Collateral, taken as a whole,
or
the priority of such security interests, or (d) Secured Party’s rights and
remedies under this Agreement and the other Loan Documents.
5.
Negative
Covenants of the Debtor.
Except
as otherwise provided in the Loan Agreement or in this Agreement, without the
prior written consent of the Secured Party, the Debtor shall not:
(a)
Transfer, sell or assign any of the Collateral other than in the ordinary course
of business or as otherwise permitted in the Loan Agreement;
(b)
Allow
or permit any other security interest or lien to attach to any of the Collateral
other than the Permitted Encumbrances;
(c)
File,
authorize, or permit to be filed in any jurisdiction any financing statement
relating to any of the Collateral unless the Secured Party is named as sole
secured party or to the extent relating to the Permitted
Encumbrances;
(d)
Permit any of the Collateral to be levied upon under any legal
process;
(e)
Permit anything to be done that materially impairs the value of any of the
Collateral taken as a whole; or
(f)
Use
the Collateral in material violation of any law or in any manner inconsistent
with any policy of insurance thereon, except where such use would not materially
impair the value of the Collateral taken as whole.
6.
Fixtures.
It is
the intention of the parties hereto that none of the Collateral shall become
fixtures. Without limiting the generality of the foregoing, the Debtor will,
if
requested by the Secured Party, use reasonable efforts to obtain waivers of
lien, in form satisfactory to the Secured Party, from each mortgagee or lessor
of real property (other than the Secured Party) on which any material amount
of
the Collateral is or is to be located.
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7.
Insurance.
Debtor
shall, at its own expense, maintain insurance covering the Collateral against
such risks, with such insurers, in such form, and in such amounts as shall
from
time to time be reasonably required by Secured Party, but in any event, in
such
amounts and with such coverage as is customary in Debtor's type of business.
All
casualty insurance policies shall be payable in the event of loss to Secured
Party to the extent of its interest. All insurance policies shall provide for
the insurer to endeavor to give Secured Party thirty (30) days' written notice
to Secured Party of cancellation and for notice to Secured Party of any claims
paid thereunder. Copies of all insurance policies shall be furnished to Secured
Party upon its request. Secured Party is hereby appointed as attorney
irrevocable to take any or all of the following actions: to collect return
premiums, dividends and other amounts due on any casualty insurance policy
and
the proceeds of such insurance, to settle any claims with the insurers in the
event of loss or damage to Collateral, to endorse settlement drafts and to
cancel, assign, or surrender any insurance policies. If any return premiums,
dividends, other amounts or proceeds are paid to Secured Party under such
policies, Secured Party may, at Secured Party's option, take either or both
of
the following actions: (i) apply such return premiums, dividends, other amounts
and proceeds in whole or in part to the payment or satisfaction of any of the
Secured Obligations in whatever order Secured Party determines; or (ii) pay
over
such return premiums, dividends, other amounts and proceeds in whole or in
part
to Debtor for the purpose of repairing or replacing the Collateral destroyed
or
damaged, any return premiums, dividends, other amounts and proceeds so paid
over
by Secured Party to be secured by this Agreement.
8.
Receivables.
Debtor
agrees that Secured Party may communicate with account debtors in order to
verify the existence, amount, and terms of any Receivables. Secured Party may
notify account debtors of the security interests established herein and,
following a Default or an Event of Default, require that payments on Receivables
be made directly to Secured Party, and upon the request of Secured Party, Debtor
shall notify account debtors and indicate on all xxxxxxxx that payments and
returns are to be made directly to Secured Party. In furtherance of the
foregoing, Debtor hereby appoints Secured Party attorney irrevocable with full
power, following a Default or an Event of Default, to collect, compromise,
endorse, sell, or otherwise deal with the Receivables or proceeds thereof and,
subject to the rights of any third parties, to perform the terms of any contract
in order to create Receivables in Secured Party's name or in the name of Debtor.
This Agreement may be, but need not be, supplemented by separate assignments
of
Receivables and contract rights and, if such assignments are given, the rights
and security interests given thereby shall be in addition to and not in
limitation of the rights and security interests granted by this
Agreement.
9.
Events
of Default.
The
following events shall be deemed “Events of Default” hereunder:
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(a)
An
Event of Default under the Loan Agreement or any of the Loan
Documents;
(b)
Debtor fails to observe or perform any covenant, warranty, or agreement required
to be observed or performed by it under this Agreement and such failure is
not
cured in accordance with the cure provisions set forth in the Loan
Agreement;
(c)
Debtor shall be in default under any obligation undertaken by Debtor which
default has a Material Adverse Effect on the ability of the Debtor to make
payments of its Secured Obligations or on the adequacy of the Collateral taken
as a whole as security for the Secured Obligations; or
(d)
Uninsured loss, theft, damage, or destruction of any substantial portion of
any
of the Collateral which has a Material Adverse Effect on the ability of the
Debtor to make payments of its Secured Obligations or on the adequacy of the
Collateral taken as a whole as security for the Secured
Obligations.
10.
Rights
and Remedies of Secured Party on Default.
Upon
and during the continuance of the occurrence of any Event of Default, Secured
Party shall have, by way of example and not of limitation of any other rights
available under applicable law, the following rights and remedies:
(a)
Secured Party may declare the Secured Obligations, or any of them, to be
immediately due and payable without presentment, demand, protest or notice
of
any kind, all of which are hereby expressly waived;
(b)
In
addition to all other rights and remedies contained in this Agreement, the
Loan
Agreement, and in the Loan Documents, Secured Party may exercise the rights
and
remedies accorded Secured Party by the Uniform Commercial Code or by any other
applicable law, all of which rights and remedies shall be cumulative and
non-exclusive to the extent permitted by law;
(c)
Secured Party shall have the right to enter and/or remain upon the Premises
of
Debtor, or any other place or places where any of the Collateral is located
and
kept, without any obligation to pay rent to Debtor or others, and remove
Collateral therefrom to the premises of the Secured Party or any agent of
Secured Party for such time as Secured Party may desire in order to maintain,
collect, sell and/or prepare the Collateral for sale, liquidation or
collection;
(d)
Secured Party may require the Debtor at Debtor's cost to assemble the Collateral
and make it available to Secured Party at a place reasonably designated by
Secured Party;
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(e)
Secured Party may take possession of and use and operate the Collateral in
the
manner and for the purposes as set forth in Section 11 hereinbelow;
(f)
Secured Party may sell, lease, or otherwise dispose of the Collateral as set
forth in Section 12 hereinbelow;
(g)
Secured Party shall have the right to set-off, without notice to the Debtor,
any
and all deposits or other sums at any time or times credited or due from Secured
Party to Debtor, whether in a special account (other than those established
for,
or for the benefit of, third parties) or other account or represented by a
certificate of deposit (whether or not matured); which deposit and other sums
shall at all times constitute additional security for the Secured
Obligations;
(h)
Secured Party may perform any warranty, covenant or agreement which Debtor
has
failed to perform under this Agreement; and
(i)
Secured Party may take any other action which Secured Party deems reasonably
necessary or desirable to protect the Collateral or the security interests
granted herein.
11.
Rights
of Secured Party to Use and Operate Collateral.
Upon
the occurrence and during the continuance of any Event of Default, the Secured
Party shall have the right and power to take possession of all or any part
of
the Collateral, and to exclude the Debtor and all persons claiming under the
Debtor wholly or partly therefrom, and thereafter to hold, store, and/or use,
operate, manage and control the same. Upon any such taking of possession, the
Secured Party may, from time to time, at the expense of the Debtor, make all
such repairs, replacements, alterations, additions and improvements to and
of
the Collateral as the Secured Party may reasonably deem proper. In any such
case, subject as aforesaid, the Secured Party shall have the right to manage
and
control the Collateral and to carry on the business and to exercise all rights
and powers of the Debtor in respect thereto as the Secured Party shall deem
best, including the right to enter into any and all such agreements with respect
to the leasing and/or operation of the Collateral or any part thereof as the
Secured Party may see fit; and the Secured Party shall be entitled to collect
and receive all rents, issues, profits, fees, revenues and other income of
the
same and every part thereof. Such rents, issues, profits, fees, revenues and
other income shall be applied to pay the reasonable expenses of holding and
operating the Collateral and of conducting the business thereof, and of all
maintenance, repairs, replacements, alterations, additions and improvements,
and
to make all payments which the Secured Party may be required or may elect to
make, if any, for taxes, assessments, insurance and other charges upon the
Collateral or any part thereof, and all other payments which the Secured Party
may be required or authorized to make under any provision of this Agreement
(including reasonable legal costs and attorneys' fees). The remainder of such
rents, issues, profits, fees, revenues and other income shall be applied to
the
payment of the Secured Obligations in such order of priority as the Secured
Party may determine in its sole discretion and any surplus shall be returned
to
the Debtor. Without limiting the generality of the foregoing, upon the
occurrence and during the continuance of an Event of Default the Secured Party
shall have the right to apply for and have a receiver appointed by a court
of
competent jurisdiction in any action taken by the Secured Party to enforce
its
rights and remedies hereunder in order to manage, protect and preserve the
Collateral and continue the operation of the business of the Debtor and to
collect all revenues and profits thereof and apply the same to the payment
of
all expenses and other charges of such receivership including the compensation
of the receiver and to the payment of the Secured Obligations as aforesaid
until
a sale or other disposition of such Collateral shall be finally made and
consummated.
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12.
Rights
of Secured Party to Sell Collateral.
Upon
(10) days prior written notice by registered or certified mail by Secured Party
to Debtor at the address of the Debtor set forth above (or at such other address
or addresses as the Debtor shall specify in writing by like notice to the
Secured Party) of the time and place of any intended disposition of Collateral,
then Secured Party shall have the right and power to sell, assign, lease, or
otherwise dispose of the Collateral from any business premises of the Debtor,
either at public auction or private sale, by liquidation sale or other
disposition, or as if the sale was being made in the ordinary course of Debtor's
business, with or without notice to the public that the said sale or disposition
is for the benefit of the Secured Party; provided, however, that if the
Collateral is perishable or threatens to decline speedily in value or is of
a
type customarily sold on a recognized market, then Secured Party shall have
the
right and power to dispose of the Collateral without prior notice to Debtor
and
Debtor expressly waives any rights to prior notice under such circumstances.
The
notices described above shall be deemed to meet any requirement hereunder or
under any applicable law (including the Uniform Commercial Code) that reasonable
notification be given of the time and place of such sale or other disposition.
After deducting all reasonable costs and expenses of collection, storage,
custody, sale or other disposition and delivery (including reasonable legal
costs and attorneys' fees) and all other reasonable charges against the
Collateral, the residue of the proceeds of any such sale or disposition shall
be
applied to the payment of the Secured Obligations in such order of priority
as
the Secured Party may determine in its sole discretion and any surplus shall
be
returned to the Debtor. In the event the proceeds of any sale, lease or other
disposition of the Collateral hereunder are insufficient to pay all of the
Secured Obligations in full, the Debtor will be liable for the deficiency,
together with interest thereon at the maximum rate provided in the Loan
Agreement and the cost and expenses of collection of such deficiency, including,
without limitation, reasonable fees of attorneys, experts, and agents, expenses
and disbursements.
13.
Attorney-in-Fact.
The
Debtor hereby irrevocably authorizes the Secured Party at any time and from
time
to time to sign (if required) and file in any appropriate filing office,
wherever located, any financing statement that (a) describes the Collateral
in a manner consistent with Section 1 and (b) contains any other
information required by the Uniform Commercial Code of the applicable
jurisdiction for the sufficiency or filing office acceptance of any financing
statement, including (i) whether the Debtor is an organization, the type of
organization and any organization identification number issued to the Debtor
and, (ii) in the case of a financing statement filed as a fixture filing, a
sufficient description of real property to which the Collateral relates. The
Secured Party is hereby appointed the attorney-in-fact, with full power of
substitution, of the Debtor for the purpose of carrying out the provisions
of
this Agreement and taking any action and executing any instruments (including,
without limitation, financing or continuation statements, conveyances,
assignments, and transfers) which the Secured Party may reasonably deem
necessary or advisable to accomplish the purposes hereof, which appointment
as
attorney-in-fact is coupled with an interest and is irrevocable. The Debtor
shall indemnify and hold harmless the Secured Party from and against any
liability or damage which it may incur in the exercise and performance, in
good
faith, of the Secured Party's powers and duties as such attorney-in-fact, except
for any liability or damage resulting from Secured Party’ gross negligence or
willful misconduct.
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14.
Waiver,
etc.
The
Debtor hereby waives presentment, demand, notice, protest and, except as is
otherwise provided herein, all other demands and notices in connection with
this
Agreement or the enforcement of the Secured Party's rights hereunder or in
connection with any Secured Obligations or any Collateral. The Debtor further
consents to and waives notice of the granting of renewals, extensions of time
for payment or other indulgences to the Debtor, or subject to applicable law
to
any account debtor in respect of any Receivable, or to substitution, release
or
surrender of any Collateral, addition or release of persons primarily or
secondarily liable on any Secured Obligation or on any Receivable or other
Collateral, or the acceptance of partial payments on any Secured Obligation
or
on any account receivable or other Collateral and/or the settlement or
compromise thereof. No delay or omission on the part of the Secured Party in
exercising any right hereunder shall operate as a waiver of such right or of
any
other right hereunder. Any waiver of any such right on any one occasion shall
not be construed as a bar to or waiver of any such right on any such future
occasion. Notwithstanding any other provision of this Agreement or any of the
other Loan Documents to the contrary, an Event of Default under this Agreement
or any of the other Loan Documents, shall be deemed continuing until such time
as such Event of Default is waived by the Secured Party in writing.
15.
Termination;
Assignments, etc.
This
Agreement and the security interest in the Collateral created hereby shall
terminate when all of the Secured Obligations have been paid, performed,
and
finally discharged in full, and all commitment of the Secured Party with
respect
thereto have terminated. If
any of
the Collateral shall be sold, transferred or otherwise disposed of by the
Debtor
in a transaction permitted by the Loan Agreement, or if the Debtor requests
that
the Secured Party release, or subordinate its security interest in, any
Collateral to the extent (but only to the extent) necessary to permit the
consummation of any other transaction not prohibited by any Loan Document,
then
the Secured Party, at the request and sole expense of the Debtor, shall execute
and deliver to the Debtor all releases or other documents reasonably necessary
or desirable for the release of the security interests created hereby on
such
Collateral.
In
the
event of a sale or assignment by the Secured Party of all or any of the Secured
Obligations held by it, such Secured Party may assign or transfer its rights
and
interests under this Agreement in whole or in part to the purchaser or
purchasers of such Secured Obligations, whereupon such purchaser or purchasers
shall become vested with all of the powers, rights, and obligations of such
Secured Party hereunder, and such Secured Party shall thereafter be forever
released and fully discharged from any liability or responsibility hereunder,
with respect to the rights and interests so assigned.
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16.
Notices.
All
notices, requests, demands and other communications provided for hereunder
shall
be in writing (including telegraphic communication) and shall be either mailed
by certified mail, return receipt requested, or delivered by overnight courier
service, to the applicable party at the addresses first set forth above, or,
as
to each party, at such other address as shall be designated by such parties
in a
written notice to the other party complying as to delivery with the terms of
this Section. All such notices, requests, demands and other communication shall
be effective on the date of first attempted delivery.
17.
Miscellaneous.
(a)
The
powers conferred on the Secured Party hereunder are solely to protect its
interest in the Collateral and shall not impose any duty upon it to exercise
any
such powers. Except for the safe custody of any Collateral in its possession
and
the accounting for monies actually received by it hereunder, the Secured Party
shall not have any duty as to any Collateral or as to the taking of any
necessary steps to preserve any right of it or of the Debtor against other
parties pertaining to any Collateral, except to the extent specifically required
under applicable law;
(b)
No
provision hereof shall be amended except by a writing signed by the Secured
Party and the Debtor;
(c)
Any
provision of this Agreement which is prohibited or unenforceable shall be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof;
(d)
This
Agreement shall be binding upon and shall inure to the benefit of the successors
and assigns of the Secured Party and the Debtor;
(e)
No
delay, failure to enforce, or single or partial exercise on the part of the
Secured Party in connection with any of its rights hereunder shall constitute
an
estoppel or waiver thereof, or preclude other or further exercises or
enforcement thereof and no waiver of any default hereunder shall be a waiver
of
any subsequent default; and
(f)
This
Agreement shall be governed as to its validity, interpretation and effect in
accordance with the laws of the State of New Hampshire; provided, however,
that
to the extent otherwise provided under the Uniform Commercial Code, the laws
of
the jurisdiction where Debtor is located under the Uniform Commercial Code
shall
govern perfection, the effect of perfection and non-perfection, and the priority
of security interests in the Collateral.
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SECURED
PARTY AND DEBTOR MUTUALLY HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE
THE RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY CLAIM BASED HEREON, ARISING
OUT
OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER LOAN DOCUMENTS
CONTEMPLATED TO BE EXECUTED IN CONNECTION HEREWITH OR ANY COURSE OF CONDUCT,
COURSE OF DEALINGS, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY
PARTY, INCLUDING, WITHOUT LIMITATION, ANY COURSE OF CONDUCT, COURSE OF DEALINGS,
STATEMENTS OR ACTIONS OF SECURED PARTY RELATING TO THE ADMINISTRATION OF THE
LOAN OR ENFORCEMENT OF THE LOAN DOCUMENTS, AND AGREE THAT NEITHER PARTY WILL
SEEK TO CONSOLIDATE ANY SUCH ACTION WITH ANY OTHER ACTION IN WHICH A JURY TRIAL
CANNOT BE OR HAS NOT BEEN WAIVED. EXCEPT AS PROHIBITED BY LAW, EACH OF SECURED
PARTY AND DEBTOR HEREBY WAIVES ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER IN
ANY
LITIGATION ANY SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES OR ANY
DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL DAMAGES. DEBTOR CERTIFIES THAT
NO
REPRESENTATIVE, AGENT OR ATTORNEY OF SECURED PARTY HAS REPRESENTED, EXPRESSLY
OR
OTHERWISE, THAT SECURED PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO
ENFORCE THE FOREGOING WAIVER. THIS WAIVER CONSTITUTES A MATERIAL INDUCEMENT
FOR
SECURED PARTY TO ACCEPT THIS AGREEMENT AND MAKE THE LOANS.
[SIGNATURE
PAGE FOLLOWS]
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IN
WITNESS WHEREOF, the undersigned have set their hands and seals and enter into
this Agreement all as of the day and year first above written.
| DEBTOR | |
| BUILDING PARTNERS, INC. | |
| _______________________ | By: ______________________________ |
| Witness |
Signature/Title Duly Authorized |
|
SECURED
PARTY
|
|
| TD BANKNORTH, N.A. | |
| _______________________ | By:_______________________________ |
| Witness | Xxxx Xxxxxxx, Senior Vice President |
|
|
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