EXHIBIT 10.17
FORM OF
SECURITY AGREEMENT
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(Banking Office)
FOR VALUE RECEIVED, and in order to induce THE BANK OF NEW YORK (the
"Bank"), in its discretion, to make loans or otherwise extend credit at any
time, and from time to time to, or at the request of, the undersigned (the
"Debtor"), whether the loans or credit so extended shall be absolute or
contingent, the Debtor (jointly and severally, if more than one and whether
executing the same or separate instruments) grants to the Bank, as security for
all present or future obligations or liabilities of any and all kinds of the
Debtor to it, whether incurred by the Debtor as maker, indorser, drawer,
acceptor, guarantor, accommodation party, counterparty, purchaser, seller or
otherwise, whether due or to become due, secured or unsecured, absolute or
contingent, joint and/or several, and howsoever or whensoever acquired by the
Bank including interest accruing thereon before or after the commencement of any
insolvency, bankruptcy or reorganization proceeding of the Debtor whether or not
such interest is an allowable claim in any proceeding and irrespective of the
discharge or release of the Debtor in such proceeding (all of which are referred
to collectively as the "Obligations"), a security interest in and a lien upon
all personal property and fixtures of the Debtor or in which the Debtor has an
interest wherever located and whether now or hereafter existing or now owned or
hereafter acquired and whether or not subject to the Uniform Commercial Code
(the "Code") specified in Schedule A hereto, and also including all interest,
dividends and other distributions thereon paid and payable in cash or in
property, and all replacements and substitutions for, and all accessions and
additions to, and all products and proceeds of, all of the foregoing (all of
which are referred to as the "Collateral").
The Debtor agrees to deliver to the Bank whenever called for by it such
additional collateral security of a kind and of a market value satisfactory to
the Bank, so that there will, at all times, be with the Bank a margin of
security for the payment of all Obligations which shall be satisfactory to it.
In addition to the Bank's security interest in the Collateral, it shall have,
and the Debtor hereby grants to the Bank, a security interest and a lien for all
the Obligations in and upon any personal property of the Debtor or in which the
Debtor may have an interest which is now or may at any time hereafter come into
the possession or control of the Bank, or of any third party acting on its
behalf, whether for the express purpose of being used by the Bank as collateral
security or held in custody or for any other or different purpose, including
such personal property as may be in transit by mail or carrier for any purpose,
or covered or affected by any documents in the Bank's possession or control, or
in the possession or control of any third party acting on its behalf (said
additional personal property is also referred to as the "Collateral"). The
Debtor hereby authorizes the Bank in its discretion, at any time, whether or not
the Collateral is deemed by it adequate, to appropriate and apply upon any of
the Obligations, whether or not due, any of such property of the Debtor and to
charge any of the Obligations against any balance of any account standing to the
credit of the Debtor on the books of the Bank.
Upon failure of the Debtor to pay any Obligation when becoming or made
due, in accordance with its terms, the Bank shall have, in addition to all other
rights and remedies allowed by law, the rights and remedies of a secured party
under the Code and, without limiting the generality of the foregoing, the Bank
may immediately, without demand of performance and without notice of intention
to sell or otherwise dispose of or of time or place of sale or other disposition
or of redemption or other notice or demand whatsoever to the Debtor, all of
which, to the extent permitted by law, are hereby expressly waived, and without
advertisement, (a) sell at public or private sale, grant options to purchase or
otherwise realize upon, in the State of New York, or elsewhere, the whole or
from time to time any part of the Collateral upon which the Bank shall have a
security interest or lien as aforesaid, or any interest which the Debtor may
have therein, and (b) exercise any and all rights, options, powers, benefits or
privileges given to the Bank upon any life insurance policies held as
Collateral. After deducting from the proceeds of any such sale or other
disposition of the Collateral all expenses (including, but not limited to,
reasonable attorneys' fees and expenses and other expenses as set forth below),
the Bank shall apply the residue of such proceeds toward the payment of any of
the Obligations, in such order as the Bank shall elect, the Debtor remaining
liable for any deficiency, plus interest thereon, remaining unpaid after such
application. If notice of any sale or other disposition is required by law to be
given, the Debtor hereby agrees that a notice sent at least five days before the
time of any intended public sale or of the time after which any private sale or
other disposition of the Collateral is to be made, shall be reasonable notice of
such sale or other disposition. The Debtor also agrees to assemble the
Collateral at such place or places as the Bank designates by written notice.
At any such sale or other disposition the Bank or any other person
designated by the Bank may itself purchase the whole or any part of the
Collateral sold, free from any right of redemption on the part of the Debtor,
which right, to the extent permitted by law, is hereby waived and released.
The Bank may, without any notice to the Debtor, in its discretion, whether
or not any of the Obligations are due, in its name or in the name of the Debtor,
demand, xxx for, collect and receive any money or property at any time due,
payable or receivable on or on account of or in exchange for, and may
compromise, settle or extend the time of payment of, any of the demands or
obligations represented by any of the Collateral, and may also exchange any of
the Collateral for other property upon the reorganization, recapitalization or
other readjustment of the issuer, maker or other person who is obligated on or
otherwise has liabilities with respect to the Collateral, and in connection
therewith may deposit any of the Collateral with any committee or depositary
upon such terms as the Bank may in its discretion deem appropriate, and the
Debtor does hereby constitute and appoint the Bank the Debtor's true and lawful
attorney to compromise, settle or extend payment of said demands or obligations
and exchange such Collateral as the Debtor might or could do personally; all
without liability or responsibility for action herein authorized and taken or
not taken in good faith. The Bank is entitled at any time in its discretion to
notify an account debtor or the obliger on any instrument to make payment to it,
regardless of whether or not the Debtor had been previously making collections
on the Collateral, and the Bank may take control of any proceeds of any of the
Collateral. Upon request of the Bank, the Debtor shall receive and hold all
proceeds of the Collateral in trust for the Bank and not commingle any
collections with any of its own funds and immediately deliver such collections
to the Bank.
The Debtor agrees that the Collateral secures, and further agrees to pay
on demand, all expenses (including, but not limited to, reasonable attorneys'
fees and expenses and costs of any insurance and payment of taxes or other
charges) of, or incidental to, the custody, care, sale or collection of, or
realization upon, any of the Collateral or in any way relating to the
enforcement or protection of the rights of the Bank hereunder, whether or not
litigation is commenced.
The Debtor agrees to xxxx its books and records as the Bank shall request
in order to reflect the rights of the Bank granted herein, and the Bank may, in
its sole discretion, take possession of the Collateral at any time, either prior
to or subsequent to a default under any of the Obligations. The Debtor agrees to
maintain such insurance on the Collateral as the Bank may require. The Bank may,
without any notice to the Debtor, in its discretion, and for its own benefit,
lend, use, transfer or repledge to any third party all or any part of the
Collateral by itself or commingled with the property of others, in bulk or
otherwise. The Bank may, without any notice to the Debtor, sell, assign or
transfer any of the Obligations and the Bank's rights and duties hereunder, and
may deliver the Collateral, or any part thereof, to the assignee or transferee
of any of the Obligations, who shall become vested with all the rights,
remedies, powers, security interests and liens herein given to the Bank in
respect thereto; and the Bank shall thereafter be relieved and fully discharged
from any liability or responsibility in the premises.
The Bank may, without any notice to the Debtor, in its discretion,
transfer, or cause to be transferred, all or any part of the Collateral to its
name, or to the name of its nominee, vote the Collateral so transferred, and
receive income and make or receive collections, including money, thereon and
hold said income and collections as Collateral or apply said income and
collections to any of the Obligations, the manner and distribution of the
application to be made as the Bank shall elect.
Calls for Collateral, demand for payment or notice to the Debtor may be
given by leaving same at the address given below or any other address hereafter
filed with the Bank, or by mailing same to such address with the same effect as
if delivered personally. Such notice given in the manner herein provided shall
be effective whether or not received by the Debtor. The Debtor agrees not to
change its name, any of its places of business, remove any records of the Debtor
relating to any of the Collateral or move any of the Collateral without giving
the Bank thirty days prior written notice.
With respect to the Collateral, the Bank shall be under no duty to send
notices, perform services, exercise any rights of collection, enforcement,
conversion or exchange, vote, pay for insurance, taxes or other charges or take
any action of any kind in connection with the management thereof and its only
duty with respect thereto shall be to use reasonable care in its custody and
preservation while in its possession, which shall not include any steps
necessary to preserve, obtain, secure or acquire rights or property against or
from any parties.
The Debtor authorizes the Bank, at the Debtor's expense, to file one or
more financing statements and amendments thereto to perfect the security
interests granted herein, without the Debtor's signature thereon, and to take
all actions necessary to perfect (whether by filing, possession, control or
otherwise) its security interest in the Collateral under any applicable law or
regulation and the Debtor agrees to do, file, record, make, execute and deliver
all such acts, deeds, things, agreements, notices, instruments and financing
statements as the Bank may request in order to perfect and enforce the rights of
the Bank herein.
If at any time it is necessary in the opinion of counsel to the Bank that
any or all of the securities held as Collateral (the "Pledged Securities") be
registered under the Securities Act of 1933, as amended, or that an indenture
with respect thereto be qualified under the Trust Indenture Act of 1939, as
amended, in order to permit the sale or other disposition of the Pledged
Securities, the Debtor shall at the Bank's request and at the expense of the
Debtor use the best efforts of the Debtor promptly to cause the registration of
the Pledged Securities and the qualification of such indenture and to continue
such registration and qualification under such laws and in such jurisdictions
and for as long as deemed appropriate by the Bank.
The Debtor hereby authorizes the Bank to date this agreement as of the
date of the granting of any Obligation secured hereby and to complete any blank
space herein (including any schedule hereto) according to the terms upon which
said Obligation was granted.
This agreement may not be amended, or compliance with its terms waived,
orally or by course of dealing, but only by a writing signed by an authorized
officer of the Bank.
No failure on the part of the Bank to exercise, and no delay in
exercising, any right, remedy or power hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise by the Bank of any right,
remedy or power hereunder preclude any other or future exercise thereof or the
exercise of any other right, remedy or power.
Each and every right, remedy and power hereby granted to the Bank or
allowed it by law or other agreement shall be cumulative and not exclusive of
any other right, remedy or power, and may be exercised by the Bank at any time
and from time to time.
This agreement may be assigned by the Bank and its benefits shall inure to
the successors, indorsees and assigns of the Bank.
This agreement shall be construed and interpreted, and all rights and
obligations hereunder shall be determined, in accordance with the laws of the
State of New York without regard to principles of conflict of laws.
Unless otherwise defined or the text otherwise requires, all terms used
herein shall have the meanings specified in the Code.
Every provision of this agreement is intended to be severable; if any term
or provision of this agreement shall be invalid, illegal or unenforceable for
any reason whatsoever, the validity, legality and enforceability of the
remaining provisions hereof shall not in any way be affected or impaired
thereby.
Any notice to the Bank shall be effective only upon receipt by the Bank
and if directed to the Bank at its banking office set forth above or any other
address hereafter specified by written notice from the Bank to the Debtor.
The Debtor represents and warrants that at the time the Collateral becomes
subject to the Bank's security interest, the Debtor shall be the sole owner of
and fully authorized and able to sell, transfer, pledge and/or grant a first
priority security interest in the Collateral to the Bank and the Collateral
shall be free and clear of all other claims, liens, charges, security interests
and encumbrances except as permitted in writing by the Bank. The Debtor
represents and warrants to the Bank that any information furnished to the Bank
regarding the Collateral is true and correct on the date hereof and is complete
in all material respects.
IF THE DEBTOR IS A CORPORATION:
The Debtor represents and warrants that the Debtor is a corporation duly
organized, validly existing and in good standing under the laws of the state of
its incorporation; that the execution, delivery and performance of this
agreement are within the Debtor's corporate powers and have been duly authorized
by all necessary action of its board of directors and shareholders; and that
each person executing this agreement has the authority to execute and deliver
this agreement on behalf of the Debtor.
IF THE DEBTOR IS A LIMITED LIABILITY COMPANY:
The Debtor represents and warrants that the Debtor is a limited liability
company duly organized, validly existing and in good standing under the laws of
the state of its organization; that the execution delivery and performance of
this agreement are within the Debtor's company powers and have been duly
authorized by all necessary action of its members; and that each person
executing this agreement has the authority to execute and deliver this agreement
on behalf of the Debtor.
IF THE DEBTOR IS A PARTNERSHIP:
The Debtor represents and warrants that the Debtor is a partnership duly
formed under the laws of the state of its formation, that the execution delivery
and performance of this agreement are within the Debtor's partnership powers and
have been duly authorized by all necessary action of its partners and do not
contravene the provisions of its partnership agreement; and that each person
executing this agreement has the authority to execute and deliver this agreement
on behalf of the Debtor.
THE DEBTOR SUBMITS TO THE JURISDICTION OF STATE AND FEDERAL COURTS LOCATED
IN THE CITY AND STATE OF NEW YORK IN PERSONAM AND AGREES THAT ALL ACTIONS AND
PROCEEDINGS RELATING DIRECTLY OR INDIRECTLY TO THIS AGREEMENT SHALL BE LITIGATED
ONLY IN SAID COURTS OR IN COURTS LOCATED ELSEWHERE AS THE BANK MAY SELECT AND
THAT SUCH COURTS ARE CONVENIENT FORUMS AND WAIVES PERSONAL SERVICE UPON IT AND
CONSENTS TO SERVICE OF PROCESS OUT OF SAID COURTS BY MAILING A COPY THEREOF TO
IT BY REGISTERED OR CERTIFIED MAIL.
THE DEBTOR AND THE BANK WAIVE THE RIGHT TO TRIAL BY JURY IN ANY ACTION OR
PROCEEDING BASED UPON, ARISING OUT OF OR IN ANY WAY CONNECTED WITH THIS
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
NAME OF GUARANTOR: , In ADDRESS OF GUARANTOR
SIGNATURE OF DEBTOR
OR AUTHORIZED SIGNER:
If Authorized Signer
Name:
Title:
SIGNATURE OF DEBTOR
OR AUTHORIZED SIGNER:
If Authorized Signer
Name:
Title:
[SCHEDULE A ON FOLLOWING PAGE MUST BE COMPLETED]
SCHEDULE A
TO
SECURITY AGREEMENT
EXECUTED BY
(Name of Debtor)
Property specifically included as "Collateral" for purposes of the within
Security Agreement.
All personal property and fixtures of the Debtor or in which the Debtor
has an interest, in each case whether now or hereafter existing or now owned or
hereafter acquired and whether subject to the Uniform Commercial Code including
all goods, money, instruments, accounts, farm products, inventory, equipment,
documents, chattel paper, securities and general intangibles (other than any and
all copyrights, trademarks, service marks, patents and other similar rights and
interests of the Debtor) and all interest, dividends and other distributions
thereon paid and payable in cash or in property; and all replacements and
substitutions for, and all accessions and additions to, and all products and
Proceeds of, all of the foregoing.
As used herein the term Proceeds shall have the meaning set forth in Article 9
of the Uniform Commercial Code and, to the extent not otherwise included, shall
include, but not be limited to, (i) any and all proceeds of any insurance,
causes and rights of action or settlements thereof, escrowed amounts or
property, judicial and arbitration judgments and awards, payable to the Debtor
from or in respect of any person from time to time; (ii) any and all payments
(in any form whatsoever) made or due and payable to the Debtor from time to time
in connection with any requisition, confiscation, condemnation, seizure or
forfeiture of all or any part of the foregoing collateral by any governmental
authority; (iii) all claims of the Debtor for losses or damages arising out of
or relating to or for any breach of any agreements, covenants, representations
or warranties or any default whether or not with respect to or under any of the
foregoing collateral (without limiting any direct or independent rights of the
Bank with respect to the collateral); and (iv) any and all other amounts from
time to time paid or payable under or in connection with the foregoing
collateral.
