SECURITY AGREEMENT
Exhibit 4
THIS SECURITY AGREEMENT (this “Agreement”) dated as of April 15, 2005, is among RCG
Companies Incorporated, a Delaware corporation (together with its successors and assigns,
“Debtor”), and Amadeus Americas, Inc. f/k/a Amadeus NMC Holding, Inc., a Delaware
corporation (“Secured Party”).
W I T N E S S E T H:
WHEREAS, this Agreement is made pursuant to the Agreement and Plan of Merger, dated February
10, 2005, by and among OneTravel, Inc., a Texas corporation, the Debtor, Amadeus Americas, Inc.
f/k/a Amadeus NMC Holding, Inc., a Delaware corporation (“Amadeus”), Terra Networks Asociadas,
S.L., a company organized and existing under the laws of the Kingdom of Spain (“Terra”), Avanti
Management, Inc., a Pennsylvania corporation (“Avanti”), and OT Acquisition Corporation, a Texas
corporation (the “Merger Agreement”);
WHEREAS, Debtor has entered into a Convertible Promissory Note dated as of the date hereof
with the Secured Party (the “Promissory Note”); and
WHEREAS, all of Debtor’s obligations, liabilities and indebtedness under the Promissory Note
are to be secured pursuant to this Agreement;
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which
hereby are acknowledged, the parties hereto agree as follows:
1. Definitions. The following terms have the following meanings (such definitions to
be applicable to both the singular and plural forms of such terms):
Arrangement means (i) any written lease, agreement, contract, commitment or license or
(ii) any enforceable understanding or enforceable oral lease, agreement, contract, commitment or
license; by which Debtor (a) has or may acquire any rights, (b) has or may become subject to any
obligation or liability, or (c) any of the assets owned or used by it is or may become bound.
Collateral means all of the assets of the Debtor, wherever located, now owned or in
the future existing or acquired by Debtor, and all proceeds and products thereof, and any
substitutes or replacements therefore, including but not limited to the following items and types
of property of the Debtor:
(a) All personal property and fixture property of every kind and nature including,
without limitation, all accounts, chattel paper (whether tangible or electronic), goods
(including inventory, equipment, and any accessions thereto), software, instruments,
investment property, documents, deposit accounts, money, commercial tort claims, letters of
credit or letter-of-credit rights, supporting obligations, tax refunds, and general
intangibles (including payment intangibles);
(b) All rights, titles, and interests of Debtor in and to all outstanding stock,
equity, or other investment securities owned by Debtor, including, without limitation, all
capital stock of any subsidiary of the Debtor;
(c) All rights, titles, and interests of Debtor in and to all promissory notes and
other instruments payable to Debtor, including, without limitation, all inter-company notes
from subsidiaries (“Collateral Notes”) and all rights, titles, interests, and liens
and encumbrances Debtor may have, be, or become entitled to under all present and future
loan agreements, security agreements, pledge agreements, deeds of trust, mortgages,
guarantees, or other documents assuring or securing payment of or otherwise evidencing the
Collateral Notes;
(d) The Partnership Interests (as defined below) and all rights of Debtor with respect
thereto, including, without limitation, all of Debtor’s distribution rights, income rights,
liquidation interest, accounts, contract rights, general intangibles, notes, instruments,
drafts, and documents relating to the Partnership Interests;
(e) (i) All copyrights (whether statutory or common law, registered or unregistered),
works protectable by copyright, copyright registrations, copyright licenses, and copyright
applications of Debtor, including, without limitation, all of Debtor’s right, title, and
interest in and to all copyrights registered in the United States Copyright Office or
anywhere else in the world; (ii) all renewals, extensions, and modifications thereof; (iii)
all income, licenses, royalties, damages, profits, and payments relating to or payable under
any of the foregoing; (iv) the right to xxx for past, present, or future infringements of
any of the foregoing; and (v) all other rights and benefits relating to any of the foregoing
throughout the world; in each case, whether now owned or hereafter acquired by Debtor
(“Copyrights”);
(f) (i) All patents, patent applications, patent licenses, and patentable inventions of
Debtor, including, without limitation, registrations, recordings, and applications thereof
in the United States Patent and Trademark Office or in any similar office or agency of the
United States, any state thereof or any other country or any political subdivision thereof,
and all of the inventions and improvements described and claimed therein; (ii) all
continuations, divisions, renewals, extensions, modifications, substitutions,
reexaminations, continuations-in-part, or reissues of any of the foregoing; (iii) all
income, royalties, profits, damages, awards, and payments relating to or payable under any
of the foregoing; (iv) the right to xxx for past, present, and future infringements of any
of the foregoing; and (v) all other rights and benefits relating to any of the foregoing
throughout the world; in each case, whether now owned or hereafter acquired by Debtor
(“Patents”);
(g) (i) All trademarks, trademark licenses, trade names, corporate names, company
names, business names, fictitious business names, trade styles, service marks, certification
marks, collective marks, logos, other business identifiers, all registrations, recordings,
and applications thereof, including, without limitation, registrations, recordings, and
applications in the United States Patent and Trademark Office or in any similar office or
agency of the United States, any state thereof or any other country or any
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political subdivision thereof; (ii) all reissues, extensions, and renewals thereof;
(iii) all income, royalties, damages, and payments now or hereafter relating to or payable
under any of the foregoing, including, without limitation, damages or payments for past or
future infringements of any of the foregoing; (iv) the right to xxx for past, present, and
future infringements of any of the foregoing; (v) all rights corresponding to any of the
foregoing throughout the world; and (vi) all goodwill associated with and symbolized by any
of the foregoing, in each case, whether now owned or hereafter acquired by Debtor
(“Trademarks”);
(h) All of Debtor’s computer software, programs and databases (including, without
limitation, source code, object code and all related applications and data files), firmware
and documentation and materials relating thereto, together with any and all maintenance
rights, service rights, programming rights, hosting rights, test rights, improvement rights,
renewal rights and indemnification rights and any substitutions, replacements, improvements,
error corrections, updates and new versions of any of the foregoing;
(i) All of Debtor’s rights, titles, and interests in other proprietary rights not
included in the Copyrights, Patents and Trademarks, whether now owned or hereafter acquired
by Debtor, including without limitation: (i) any knowledge or information that is material
to Debtor’s business and that enables Debtor to operate its business with the accuracy,
efficiency, or precision necessary for commercial success, or otherwise affords Debtor a
commercial advantage for the possession or knowledge thereof; (ii) any new and useful
process, machine, manufacture, or composition of matter, or any new and useful improvement
thereof that is material to the operation of Debtor’s business and developed by Debtor, its
employees, or agents, which could potentially be eligible for protection as Patent(s), but
whether or not currently the subject of Patent(s); and (iii) all information or other items
recognized as “trade secrets” under state or federal law and all comparable rights
recognized in foreign jurisdictions or conventions or by treaty;
(j) (i) All of debtor’s rights, titles, and interests in, to, and under the
Arrangements, including, without limitation, all rights of Debtor to receive moneys due and
to become due under or pursuant to the Arrangements, (ii) all rights of Debtor to receive
proceeds of any insurance, indemnity, warranty, or guaranty with respect to the
Arrangements, (iii) all claims of Debtor for damages arising out of or for breach of or
default under the Arrangements, and (iv) all rights of Debtor to compel performance and
otherwise exercise all rights and remedies under the Arrangements;
(k) All present and future automobiles, trucks, truck tractors, trailers,
semi-trailers, or other motor vehicles or rolling stock, now owned or hereafter acquired by
such Debtor;
(l) Any and all material deposit accounts, bank accounts, investment accounts, or
securities accounts, now owned or hereafter acquired or opened by Debtor and any account
which is a replacement or substitute for any of such accounts, together with all monies,
instruments, certificates, checks, drafts, wire transfer receipts, and other property
deposited therein and all balances therein;
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(m) All present and future distributions, income, increases, profits, combinations,
reclassifications, improvements, and products of, accessions, attachments, and other
additions to, tools, parts, and equipment used in connection with, and substitutes and
replacements for, all or part of the Collateral described above;
(n) All present and future accounts, contract rights, general intangibles, chattel
paper, documents, instruments, cash and noncash proceeds, and other rights arising from or
by virtue of, or from the voluntary or involuntary sale or other disposition of, or
collections with respect to, or insurance proceeds payable with respect to, or proceeds
payable by virtue of warranty or other claims against the manufacturer of, or claims against
any other Person with respect to, all or any part of the Collateral heretofore described in
this clause or otherwise; and
(o) All present and future security for the payment to any company of any of the
Collateral described above and goods which gave or will give rise to any such Collateral or
are evidenced, identified, or represented therein or thereby.
Event of Default means the occurrence of any Event of Default as defined in the
Promissory Note.
Jurisdiction of Organization means the jurisdiction under whose law Debtor is
organized on the date hereof.
Obligations means the obligations of the Debtor under the Promissory Note.
Partnerships shall mean (a) any partnership, joint venture, or limited liability
company in which Debtor shall, at any time, become a limited or general partner, venturer, or
member, or (b) any partnership, joint venture, or corporation formed as a result of the
restructure, reorganization, or amendment of the Partnerships.
Partnership Agreements shall mean partnership agreements, joint venture agreements, or
organizational agreements for any of the Partnerships (together with any modifications, amendments
or restatements thereof), and “Partnership Agreement” means any one of the Partnership
Agreements.
Partnership Interests shall mean all of Debtor’s right, title and interest now or
hereafter accruing under the Partnership Agreements with respect to all distributions, allocations,
proceeds, fees, preferences, payments, or other benefits, which Debtor now is or may hereafter
become entitled to receive with respect to such interests in the Partnerships and with respect to
the repayment of all loans now or hereafter made by Debtor to the Partnerships.
Permitted Liens means (a) liens for taxes, assessments, governmental charges or levies
or mechanics’ and other statutory liens which are not material in amount relative to the property
affected and which are not yet delinquent or can be paid without penalty or are being contested in
good faith by appropriate proceedings in respect thereof; (b) imperfections of title which are not
substantial in amount relative to the property affected and which do not materially interfere
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with the present use of the property subject thereto or affected thereby; and (c) liens
arising from travel agency regulations relating to customer funds.
Records means information which is inscribed on a tangible medium or which is stored
in an electronic or other medium and is retrievable in perceivable form.
UCC means the Uniform Commercial Code as in effect in the Jurisdiction of Organization
from time to time; provided that, as used in Section 9 hereof, “UCC” shall
mean the Uniform Commercial Code as in effect from time to time in any applicable jurisdiction.
2. Grant of Security Interest. As security for the prompt and complete payment,
performance and observance when due (whether at stated maturity, by acceleration or otherwise) of
all of the Obligations, Debtor hereby assigns to Secured Party and grants to Secured Party a
continuing security interest in and to (and a setoff right against) the Collateral.
3. Warranties. Debtor warrants that: (i) no financing statements, other than any
which may have been filed on behalf of Secured Party or as disclosed on Schedule 3 attached hereto,
covering any of the Collateral is on file in any public office; (ii) Debtor is the lawful owner of
all Collateral free of all liens and claims other than the security interests hereunder, liens with
respect to the financing statements disclosed on Schedule 3 attached hereto, and Permitted Liens,
with full power and authority to execute this Agreement and perform Debtor’s obligations hereunder,
and to subject the Collateral to the security interest hereunder; (iii) this Agreement is a legal,
valid and binding obligation of Debtor, enforceable in accordance with its terms, except that the
enforceability of this Agreement may be limited by bankruptcy, insolvency, fraudulent conveyance,
fraudulent transfer, reorganization, moratorium or other similar laws now or hereafter in effect
relating to creditors’ rights generally and by general principles of equity (regardless of whether
enforcement is sought in a proceeding in equity or at law); (iv) Debtor’s Jurisdiction of
Organization is Delaware, Debtor’s chief executive office and principal place of business is
located in Charlotte, North Carolina, Debtor’s tax identification number and organizational
identification number are correctly set forth on the financing statement listing Secured Party as
“Secured Party,” and Debtor maintains a place of business in the following locations: Atlanta,
Georgia and Charlotte, North Carolina.
4. Collections, etc. Until such time during the occurrence a continuance of an Event
of Default as the Secured Parties shall notify Debtor of the revocation of such power and
authority, Debtor (a) will, at its own expense, endeavor to collect, as and when due, all amounts
due under any of the Collateral as Debtor may deem advisable, and (b) may grant, in the ordinary
course of business, to any party obligated on any Collateral, any rebate, refund or allowance to
which such party may be lawfully entitled, and may accept, in connection therewith, the return of
Goods, the sale or lease of which shall have given rise to such Collateral. The Secured Party,
however, may, at any time that an Event of Default exists, whether before or after any revocation
of such power and authority or the maturity of any of the Obligations, notify any parties obligated
on any of the Collateral to make payment to the Secured Party of any amounts due or to become due
thereunder and enforce collection of any of the Collateral by suit or otherwise and surrender,
release or exchange all or any part thereof, or compromise or extend or renew for any period
(whether or not longer than the original period) any indebtedness thereunder or evidenced
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thereby. Upon the request of the Secured Party during the occurrence and continuance of an Event
of Default, Debtor will, at its own expense, notify any or all parties obligated on any of the
Collateral to make payment to the Secured Party of any amounts due or to become due thereunder.
Upon request by the Secured Party during the occurrence and continuance of an Event of
Default, Debtor will forthwith, upon receipt, transmit and deliver to the Secured Party, in the
form received, all cash, checks, drafts and other instruments or writings for the payment of money
(properly endorsed, where required, so that such items may be collected by the Secured Party) which
may be received by Debtor at any time in full or partial payment or otherwise as proceeds of any of
the Collateral. Except as the Secured Party may otherwise consent in writing, any such items which
may be so received by Debtor after receipt of the Secured Party’s request pursuant to the preceding
sentence, will not be commingled with any other of its funds or property, but will be held separate
and apart from its own funds or property and upon express trust for the Secured Party until
delivery is made to the Secured Party. Debtor will comply with the terms and conditions of any
consent given by the Secured Party pursuant to the foregoing sentence.
The Secured Party (or any designee of the Secured Party) is authorized to endorse, in the name
of the Debtor, any item, howsoever received by the Secured Party, representing any payment on or
other proceeds of any of the Collateral; provided Secured Party shall only be entitled to exercise
such authorization upon the occurrence and during the continuance of an Event of Default.
5. Certificates, Schedules and Reports. Debtor will from time to time, as the Secured
Party may reasonably request, deliver to the Secured Party such schedules, certificates and reports
respecting all or any of the Collateral at the time subject to the security interest hereunder.
Any such schedule, certificate or report shall be executed by a duly authorized officer of Debtor
and shall be in such form and detail as the Secured Party may specify. Debtor shall immediately
notify the Secured Party of the occurrence of any event causing any loss or depreciation in the
value of any Collateral which is material to Debtor taken as a whole, and such notice shall specify
the amount of such loss or depreciation.
6. Agreements of Debtor. Debtor (a) will deliver such financing statements (and
hereby authorizes Secured Party to file any financing statement as Secured Party deems necessary to
perfect its security interest in the Collateral) and, upon request of the Secured Party, other
documents (and pay the cost of filing or recording the same in all public offices reasonably deemed
appropriate by the Secured Party) and do such other acts and things all as the Secured Party may
from time to time request to establish and maintain a valid security interest in the Collateral to
secure the payment of the Obligations; (b) will keep its Records concerning the Collateral in such
a manner as will enable the Secured Party or its designees to determine at any time the status of
the Collateral; (c) will furnish to the Secured Party such information concerning Debtor and the
Collateral as the Secured Party may from time to time reasonably request; (d) will permit the
Secured Party and their designees, from time to time, on reasonable notice and at reasonable times
and intervals during normal business hours to inspect Debtor’s Collateral, and to inspect and audit
all Records and other papers in the possession of Debtor
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pertaining to the Collateral, and will, upon request of the Secured Party during the existence of a
Default, deliver to the Secured Party all of such Records and papers; (e) will promptly pay when
due all material license fees, registration fees, taxes, assessments and other charges which may be
levied upon or assessed against the ownership, operation, possession, maintenance or use of its
Collateral; (f) will take all steps reasonably necessary to protect, preserve and maintain all of
its rights in the Collateral; (g) will keep all of the tangible Collateral in the United States of
America; (h) will reimburse the Secured Party for all expenses, including reasonable attorney’s
fees and charges, incurred by the Secured Party in seeking to collect or enforce any rights in
respect of Debtor’s Collateral; and (i) will not change its Jurisdiction of Organization from that
which is in effect on the date hereof without ten (10) days’ prior written notice to Secured Party.
7. Events of Default. Whenever an Event of Default exists, the Secured Party may
exercise from time to time any right or remedy available to it under applicable law (provided
nothing herein shall limit Secured Party’s ability to exercise any right it may otherwise have
under the Promissory Note due to the existence of an Event of Default). Debtor agrees, in case of
an Event of Default, to assemble, at its expense, all its Collateral at a convenient place or
places acceptable to the Secured Party. Any notification of intended disposition of any of the
Collateral required by law shall be deemed reasonably and properly given if given at least ten (10)
days before such disposition. Any proceeds of any disposition by the Secured Party of any of the
Collateral may be applied by the Secured Party to payment of expenses in connection with the
Collateral, including reasonable attorney’s fees and charges, and any balance of such proceeds may
be applied by the Secured Party toward the payment of such of the Obligations, and in such order of
application, as the Secured Party may from time to time elect.
Notwithstanding the foregoing, the rights and remedies of Secured Party upon an Event of
Default are governed by that certain Intercreditor Agreement, dated of even date herewith, executed
by Amadeus, Terra, Avanti, and Libra Securities, LLC, a Delaware limited liability company.
8. Additional Agreements of Debtor; Authorization of Secured Party.
(a) Debtor hereby irrevocably appoints Secured Party as its attorney-in-fact and proxy, with
full authority in the place and stead of Debtor and in the name of Debtor or otherwise, from time
to time in such Secured Party’s discretion, to take any action and to execute any instrument which
such Secured Party may deem necessary or advisable to accomplish the purposes of this Agreement,
including, without limitation, (i) to ask, demand, collect, xxx for, recover, compound, receive and
give acquittance and receipts for moneys due and to become due under or in respect of any
Collateral, (ii) to receive, endorse, and collect any drafts or other instruments, documents and
chattel paper in connection with clause (i) above, (iii) to file any claims or take any action or
institute any proceedings which such Secured Party may deem necessary or desirable for the
collection of any Collateral or otherwise to enforce the rights of such Secured Party with respect
to any Collateral, and (iv) to execute assignments, licenses and other documents to enforce the
rights of such Secured Party with respect to any Collateral; provided that such Secured
Party agrees not to act as attorney-in-fact and proxy of the Debtor unless an Event of Default is
then in existence. This power is coupled with an interest and is irrevocable until all of the
Obligations are indefeasibly paid in full.
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(b) If Debtor fails to perform any agreement contained herein, the Secured Party may perform,
or cause performance of, such agreement or obligation, in the name of Debtor or the Secured Party,
and the expenses of the Secured Party incurred in connection therewith shall be payable to the
Secured Party on demand and shall be secured by the Collateral.
(c) 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 moneys actually received by
it hereunder, the Secured Party shall have no duty as to any Collateral or as to the taking of any
necessary steps to preserve rights against prior parties or any other rights pertaining to any
Collateral.
(d) Anything herein to the contrary notwithstanding (i) Debtor shall remain liable under all
licenses, contracts and otherwise with respect to any of the Collateral to the extent set forth
therein to perform all of its obligations thereunder to the same extent as if this Agreement had
not been executed, (ii) the exercise by the Secured Party of any of their rights hereunder shall
not release Debtor from any of its obligations under any licenses, contracts or otherwise in
respect of the Collateral, and (iii) the Secured Party shall not have any obligation or liability
by reason of this Agreement under any licenses, contracts or with respect to any of the other
Collateral, nor shall the Secured Party be obligated to perform any of the obligations or duties of
Debtor thereunder or to take any action to collect or enforce any claim for payment assigned
hereunder.
9. Miscellaneous. The Secured Party shall be deemed to have exercised reasonable care
in the custody and preservation of any of the Collateral in its possession if it takes such action
for that purpose as Debtor requests in writing, but failure of the Secured Party to comply with any
such request shall not of itself be deemed a failure to exercise reasonable care, and no failure of
the Secured Party to preserve or protect any right with respect to such Collateral against prior
parties, or to do any act with respect to the preservation of such Collateral not so requested by
Debtor, shall be deemed of itself a failure to exercise reasonable care in the custody or
preservation of such Collateral.
Any notice provided pursuant to this Agreement shall be given in accordance with the notice
provisions of the Merger Agreement.
Debtor agrees to pay all expenses, including reasonable attorney’s fees and charges paid or
incurred by the Secured Party in endeavoring to collect the Obligations, or any part thereof, and
in enforcing this Agreement against Debtor, and such obligations will themselves be Obligations.
No delay on the part of the Secured Party in the exercise of any right or remedy shall operate
as a waiver thereof, and no single or partial exercise by the Secured Party of any right or remedy
shall preclude other or further exercise thereof or the exercise of any other right or remedy.
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This Agreement shall remain in full force and effect until the Obligations are paid in full in
cash or converted in full pursuant to the terms of the Promissory Note. If at any time all or any
part of any payment theretofore applied by the Secured Party to any of the Obligations is or must
be rescinded or returned by the Secured Party for any reason whatsoever (including the insolvency,
bankruptcy or reorganization of Debtor), such Obligations shall, for the purposes of this
Agreement, to the extent that such payment is or must be rescinded or returned, be deemed to have
continued in existence, notwithstanding such application by the Secured Party, and this Agreement
shall continue to be effective or be reinstated, as the case may be, as to such Obligations, all as
though such application by the Secured Party had not been made.
This Agreement shall be construed in accordance with and governed by the laws of the State of
Delaware applicable to contracts made and to be performed entirely within such State, subject,
however, to the applicability of the UCC of any jurisdiction in which any Collateral may be
located at any given time if required under the UCC. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Agreement shall be prohibited by 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.
The rights and remedies of, and the privileges and actions permitted to be taken hereunder by,
the Secured Party may only be undertaken with the unanimous consent of the Secured Party, and no
individual Secured Party may exercise any such right or remedy or undertake any such privilege or
action without the express consent of the other Secured Party hereunder.
The rights and privileges of the Secured Party hereunder shall inure to the benefit of its
successors and assigns.
This Agreement may be executed in any number of counterparts and by the different parties
hereto on separate counterparts, and each such counterpart shall be deemed to be an original, but
all such counterparts shall together constitute one and the same Agreement. Debtor represents and
warrants to the Secured Party that the representations and warranties made by Debtor herein are
true and correct.
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IN WITNESS WHEREOF, this Agreement has been duly executed as of the day and year first written
above.
| DEBTOR: RCG COMPANIES INCORPORATED |
||||
| By: | / s / Xxxx X. Xxxxxxx | |||
| Name: | Xxxx X. Xxxxxxx | |||
| Title: | CFO | |||
| SECURED PARTY: AMADEUS AMERICAS, INC. f/k/a AMADEUS NMC HOLDING, INC. |
||||
| By: | / s / Xxxx X. Xxxxx | |||
| Name: | Xxxx X. Xxxxx | |||
| Title: | President | |||
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SCHEDULE 3
FINANCING STATEMENTS
None.
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