LOAN AND SECURITY AGREEMENT
$500,000 El Segundo, California
Date: November 23, 2005
FOR VALUE RECEIVED, the undersigned AUXILIO, INC., a Nevada corporation
("Company"), hereby promises to pay to CAMBRIA INVESTMENT FUND, L.P., a
California limited partnership, at such place as Holder may specify, in lawful
money of the United States of America, the principal amount of up to $500,000
(the "Loan Amount") on or before March 15, 2007 (the "Maturity Date"), plus (A)
interest on the principal amount outstanding from time to time hereunder at a
rate equal to the lesser of (i) the maximum lawful rate or (ii) twelve percent
(12%) per year, and (B) a loan initiation fee equal to $3,750, which is 0.75% of
the Loan Amount. Interest on the outstanding principal balance shall accrue and
be payable on the last day of each fiscal quarter. Interest due and payable
hereunder shall be computed on the basis of a year of 360 days and for the
actual number of days elapsed. Company shall also have delivered to Holder a
warrant to purchase stock, in form reasonably acceptable to Holder ("Warrant",
together with this Loan and Security Agreement (this "Agreement") and any other
documents delivered in connection with this Agreement, the "Loan Documents").
1. Advances; Payments. As requested by the Company from time to time,
and provided there shall be no Event of Default (as defined below) under this
Agreement, the Holder will advance the Loan Amount to the Company in increments
of $50,000. All payments under this Agreement shall be applied first to fees and
expenses, then to accrued but unpaid interest and then to principal. Any
principal or interest payments on this Agreement outstanding after the
occurrence and during the continuance of a default under this Agreement shall
bear interest at a rate equal to the lesser of (i) the lawful legal rate or (ii)
five percent (5%) (computed annually) above the interest rate otherwise
applicable under this Agreement.
2. Secured Agreement. To secure repayment of all obligations evidenced
by this Agreement and performance of all of Company's obligations hereunder,
Company, grants Holder a first priority security interest, in all of Company's
inventory, accounts, equipment, cash, deposit accounts, securities, Intellectual
Property (as defined in Exhibit A hereto), chattel paper, general intangibles
and instruments, now existing or hereafter arising, and all proceeds thereof, as
such terms are defined in the California Uniform Commercial Code (the "UCC"),
whether now owned or hereafter acquired, or any value received in exchange for
any of the foregoing (collectively, the "Collateral") as set forth in Exhibit A.
Company shall take such actions as Holder reasonably requests from time to time
to perfect or continue the first priority security interest granted hereunder
including, without limitation, filing UCC-1 financing statements in connection
therewith. Company shall not dispose of or encumber all or any substantial part
of the Collateral without prior written consent of Holder.
3. Representations, Warranties and Covenants of Company.
(a) Corporate Existence and Authority. Company is and will
continue to be duly organized, validly existing and in good standing under the
laws of the jurisdiction of its incorporation or organization. Company is and
will continue to be qualified and licensed to do business in all jurisdictions
in which any failure to do so would have a material adverse effect on Company.
Company has all requisite power to transact the business it transacts and
proposes to transact, to execute and deliver this Agreement, and all other
documents and agreements contemplated by this Agreement, and to perform the
provisions of this Agreement and to consummate the transactions contemplated by
this Agreement. The execution, delivery and performance of this Agreement, and
all other documents and agreements contemplated by this Agreement, and the
consummation of the transactions contemplated by this Agreement, have been duly
authorized and approved by Company. This Agreement, and all other documents and
agreements contemplated by this Agreement have each been duly authorized,
executed and delivered by, and each is the valid and binding obligation of,
Company enforceable against Company in accordance with its terms, except as may
be limited by applicable bankruptcy, reorganization, insolvency, moratorium or
other similar laws or by legal or equitable principles relating to or limiting
creditors' rights generally.
(b) No Conflicts. The consummation of the transactions
contemplated by this Agreement and the performance of the terms and provisions
of this Agreement, and any other documents or agreements contemplated by this
Agreement will not (i) contravene, result in any breach of, or constitute a
default under any indenture, mortgage, deed of trust, bank loan or credit
agreement, corporate charter, by-laws or other material agreement or instrument
to which Company is a party or by which Company or any of its properties or the
Collateral is bound, (ii) conflict with or result in a breach of any of the
terms, conditions or provisions of any order of any court, arbitrator or
Federal, State, municipal or other governmental department, commission, board,
bureau, agency or instrumentality, domestic or foreign (collectively,
"Governmental Person") applicable to Company or (iii) violate any material
provision of any statute or other rule or regulation of any Governmental Person
applicable to Company, which could have a material adverse effect on Company.
(c) Place of Business; Location of Collateral. The address set
forth in Section 8(c) of this Agreement is Company's chief executive office.
Company will give Holder prior written notice before opening any additional
place of business or changing its chief executive office. Portions of the
Collateral are located in the field and are moved from time to time. The Company
will cooperate with Holder in (i) perfecting the security interests granted
hereunder in all Collateral and (ii) in providing Holder, at Holder's request,
with current information regarding the whereabouts of the Collateral from time
to time.
(d) Title to Collateral; Permitted Liens. Company is now, and
will at all times in the future be, the sole owner of all the Collateral, except
for items of equipment which are leased by Company. The Collateral now is and
will remain free and clear of any and all liens, charges, security interests,
encumbrances and adverse claims, except for purchase money or lessor security
interests in certain equipment Holder now has, and will continue to have, a
first-priority perfected and enforceable security interest in all of the
Collateral, subject only to the purchase money or lessor security interests,
contractual rights of set off under bank agreements, and the liens in favor of
the other parties to the Intercreditor Agreement, and Company will at all times
defend Holder and the Collateral against all claims of others (subject to the
rights of holders of purchase money or lessor security interests in certain
equipment, contractual rights of set off under bank agreements, and the liens in
favor of the other parties to the Intercreditor Agreement). So long as the loan
is outstanding, none of the Collateral now is or will be affixed to any real
property in such a manner, or with such intent, as to become a fixture. Company
is not and will not become a lessee under any real property lease pursuant to
which the lessor may obtain any rights in any of the Collateral and no such
lease now prohibits, restrains, impairs or will prohibit, restrain or impair
Company's right to remove any Collateral from the leased premises (subject to
statutory rights of landlords). Whenever any Collateral is located upon premises
in which any third party has an interest (whether as owner, mortgagee,
beneficiary under a deed of trust, lien or otherwise), Company shall, whenever
requested by Holder, use its best efforts to cause such third party to execute
and deliver to Holder, in form acceptable to Holder, such waivers and
subordinations as Holder shall specify, so as to ensure that Holder's rights in
the Collateral are, and will continue to be, superior to the rights of any such
third party. Company will keep in full force and effect, and will comply with
all the terms of, any lease of real property where any of the Collateral now or
in the future may be located.
(e) Maintenance of Collateral. Company will maintain the
Collateral in good working condition, ordinary wear and tear excepted, and
Company will not use the Collateral for any unlawful purposes. Company will
immediately advise Holder in writing of any material loss or damage to the
Collateral.
(f) Books and Records. Company has maintained and will
maintain at Company's chief executive office complete and accurate books and
records, comprising an accounting system in accordance with generally accepted
accounting principles.
(g) Financial Condition, Statements and Reports. All financial
statements now or in the future delivered to Holder have been, and will be,
prepared in conformity with generally accepted accounting principles and now and
in the future will completely and fairly reflect the financial condition of
Company, at the times and for the periods therein stated. Between the last date
covered by any such statement provided to Holder and the date hereof, there has
been no material adverse change in the financial condition or business of
Company. Company is now and will continue to be solvent.
(h) Compliance with Law. Company has complied, and will
comply, in all material respects, with all provisions of all applicable laws and
regulations, including, but not limited to, those relating to Company's
ownership of real or personal property, the conduct and licensing of Company's
business, and all environmental matters.
2
(i) Litigation. There is no claim, suit, litigation,
proceeding or investigation pending or (to the best of Company's knowledge)
threatened by or against or affecting Company in any court or before any
governmental agency (or any basis therefor known to Company) which could
normally or reasonably be expected to result, either separately or in the
aggregate, in any material adverse change in the financial condition or business
of Company, or in any material impairment in the ability of Company to carry on
its business in substantially the same manner as it is now being conducted.
Company will promptly inform Holder in writing of any claim, proceeding,
litigation or investigation in the future threatened or instituted by or against
Company.
(j) Use of Proceeds. All proceeds of the loan shall be used
solely for lawful business purposes.
(k) Intellectual Property. Company possesses all material
licenses, permits, franchises, authorizations, patents, copyrights, trademarks
and trade names and any other tangible or intangible or intellectual property
rights, or rights thereto, required to conduct its business substantially as now
conducted and as currently proposed to be conducted, without actual knowledge of
conflict with the rights of others.
(l) Indebtedness. Except for the loan evidenced by this
Agreement and the indebtedness identified on Schedule 3(l) or as otherwise
disclosed in Company's financial statements, as of April 15, 2002, previously
delivered to Holder, Company has no outstanding indebtedness of any kind
(including contingent obligations, tax assessments and unusual forward or
long-term commitments).
(m) Disclosure. No representation or other statement made by
Company to Holder contains any untrue statement of a material fact or omits to
state a material fact necessary to make any statements made to Holder not
misleading.
(n) Performance. Company shall pay the principal of and
interest on the loan evidenced by this Agreement in the manner provided in this
Agreement. The obligation of Company described in the preceding sentence is
absolute and unconditional, irrespective of any tax or accounting treatment of
such obligation including without limitation any documentary stamp, transfer, ad
valorem or other taxes assessed by any jurisdiction in connection with this
transaction.
(o) Stay, Extension and Usury Laws. Company agrees (to the
extent it may lawfully do so) that it will not at any time insist upon, plead or
in any manner whatsoever claim or take the benefit or advantage of, any stay or
extension law or any usury law or other law that would prohibit or forgive
Company from paying all or a portion of the principal of, finance fee, or
interest on the loan contemplated by this Agreement, wherever enacted, now or at
any time hereinafter in force, or that may materially affect the covenants or
the performance of this Agreement in any manner inconsistent with the provisions
of this Agreement. Company expressly waives all benefit or advantage of any such
law. If a court of competent jurisdiction prescribes that Company may not waive
its rights to take the benefit or advantage of any stay or extension law or any
usury law or other law in accordance with the prior sentence, then the
obligation to pay interest on the principal shall be reduced to the maximum
legal limit under applicable law governing the interest payable in connection
with this Agreement, and any amount of interest paid by Company that is deemed
illegal shall be deemed to have been a prepayment of principal on the loan.
(p) Taxes. Company shall make all necessary tax filings and
reports and pay prior to delinquency all taxes, assessments and governmental
levies that may be imposed upon Company, except as contested in good faith and
by appropriate proceedings.
(q) Limitations on Indebtedness. Other than amounts owing to
San Clemente Capital, LLC, without Holder's prior written consent, Company shall
not, directly or indirectly, create, incur, assume, suffer to exist or otherwise
in any manner become liable or commit to become liable for any indebtedness
other than Company's obligations to Holder under this Agreement and indebtedness
incurred in the ordinary course of business not in excess of US$50,000 in the
aggregate.
(r) Insurance. Company shall maintain insurance with
responsible and reputable insurance companies or associations in such amounts
and covering such risks as is usually carried by companies engaged in similar
businesses and owning similar properties in the same general areas in which
Company operates.
(s) Reports. Company will provide Holder with quarterly
financial statements within 45 days after the end of each quarter and such
additional financial and other information as Holder may reasonably request from
time to time.
(t) Insurance. Company will maintain insurance on the
Collateral that includes a lender's loss payable endorsement in favor of Holder
as an additional loss payee. Company will maintain insurance in a form
acceptable to Holder relating to the Collateral and Company's business in
amounts and of a type that are customary to businesses similar to Company's.
(u) Consolidation. Company will not merge or consolidate with
any person or entity, or make any investments, or dispose of any substantial
portion of its assets without Holder's prior written consent.
4. Prepayments.
(a) Optional. Company may, from time to time, prepay the loan
evidenced hereby, in whole or in part, so long as each partial prepayment of
principal is equal to or greater than $10,000 and Company has given Holder two
(2) or more business days' written notice of such optional prepayment. Any such
optional prepayment of principal shall be without premium or penalty. Each
prepayment of principal under this Section shall be accompanied by all interest
then accrued and unpaid on the principal so prepaid. Any principal prepaid
pursuant to this Section shall be in addition to, and not in lieu of, all
payments otherwise required to be paid under this Agreement at the time of such
prepayment.
(b) Mandatory. Unless otherwise agreed to by Holder, Company
shall prepay the loan to the extent of the net financing proceeds actually
received by Company in the event that Company completes any financing
transaction, including without limitation any public or private placements of
debt or equity, that results in net proceeds to the Company in an amount in
excess of $3,000,000 and that is unrelated to the exercise of: (i) any existing
stock option, (ii) the Company's Incentive Stock Option plan, or (iii) any
existing contractual stock purchase right as of the date of this Agreement. For
purposes of this Section 4(b), the Company's most recent financing, which closed
on August 1, 2005 and which resulted in net proceeds to the Company of
$2,900,000, shall be specifically excluded.
5. Optional Conversion.
(a) At Holder's option and upon the occurrence of one of the
following events: (i) funding of the next Succeeding Financing of Company, or
(ii) the sale and purchase of substantially all of the assets or stock of
Company, the outstanding principal balance and all accrued interest under the
loan evidenced by this Agreement shall be convertible, without the payment of
any additional consideration by Holder and at the option of Holder, into equity
securities of Company of the class and series offered by the Company in the
Succeeding Financing described in (i) above or the sale and purchase of the
assets or stock of Company described in (ii) above (the "Conversion
Securities"). Holder's option to convert will expire 60 days after the
occurrence of one of the events described in subsections (i) and (ii) above,
provided, that Company has given Holder at least 15 days' prior written notice
of such event. In the event Holder elects to convert upon a funding of the
Succeeding Financing described in (i) above, Company shall issue the Conversion
Securities to Holder at a price per share equal to the average price per share
paid by all third party investors in the Succeeding Financing or, in the event
the Holder elects to convert upon a sale of the assets or stock of Company
described in (ii) above, Company shall issue common stock at a price per share
equal to (y) the average price per share paid by all third parties who acquire
all or substantially all of the stock of the Company or (z) the book value of
the common stock determined after giving effect to the purchase price of the
assets, in each case by converting outstanding principal balance and all accrued
interest under the loan evidenced by this Agreement into such equity. The
outstanding principal shall continue to accrue interest, and Company shall be
obligated to pay such interest, according to the terms and conditions of this
Agreement until the Conversion Date (as defined below).
For purposes of this Section 5, "Succeeding Financing" means a
sale of the Company of its debt or equity securities in a transaction that
results in aggregate net proceeds to the Company in an amount in excess of
$3,000,000.
(b) In order for the Holder to convert all amounts owing under
this Agreement into equity, Holder shall deliver a written notice to Company
that Holder elects to convert. Any conversion made at the election of Holder
shall be deemed to have been made immediately prior to the close of business on
the date Company is deemed to have received such notice, and the Holder or its
nominee or nominees entitled to receive the equity shall be treated for all such
purposes as the record holder or holders of such equity on such date (the
"Conversion Date"). Company shall have no obligation to issue any fractional
shares upon conversion. Any fractional shares shall be rounded up to the nearest
whole share.
6. Fees and Expenses. Each party hereto shall pay its own costs and
expenses, including reasonable attorney's fees, incurred in the preparation of
this Agreement and the other documents executed in connection with this
Agreement. Company shall pay all reasonable and actual costs that Holder incurs
in enforcing this Agreement or exercising any rights with respect to the
collateral, including without limitation reasonable attorneys' fees and
expenses.
7. Events of Default; Remedies.
(a) Events of Default Defined; Acceleration of Maturity. If
any of the following events ("Events of Default") shall occur (for any reason
whatsoever and whether it shall be voluntary or involuntary or by operation of
law or otherwise):
(i) failure by the Company to make a payment of
principal within ten days after the due date, whether at maturity or by reason
of acceleration pursuant to the terms of this Agreement or by required
prepayment;
(ii) failure by the Company to pay any interest
accrued and owing within ten days after the applicable due date, or failure to
pay any other liabilities or make any other payment, fee or charge provided for
herein or in any Other Document within ten days after the due date;
(iii) any representation or warranty made or deemed
made by the Company in this
Agreement shall prove to have been incorrect, untrue, or misleading in any
material respect on the date when made or deemed to have been made; provided,
however, that the Company shall have ten Business Days from notice of default to
cure any such failure that is capable of cure before an Event of Default shall
be deemed to have occurred under this Section;
(iv) failure by the Company to perform any of the
covenants imposed by this Agreement; provided, however, that the Company shall
have ten Business Days from notice of the default to cure any such failure that
is capable of cure before an Event of Default shall be deemed to have occurred
under this Section;
(v) the Company shall (1) apply for or consent to the
appointment of, or the taking of possession by, a receiver, custodian, trustee
or liquidator of itself or of all or a substantial part of its property and
assets, (2) be generally unable to pay its debts as such debts become due, (3)
make a general assignment for the benefit of its creditors, (4) commence a
voluntary case under the United States Bankruptcy Code or similar law or
regulation (as now or hereafter in effect), (5) file a petition seeking to take
advantage of any other law providing for the relief of debtors, (6) fail to
controvert in a timely or appropriate manner, or acquiesce in writing to, any
petition filed against it in an involuntary case under the United States
Bankruptcy Code or other law or regulation, (7) dissolve, (8) take any corporate
action under any applicable law analogous to any of the foregoing, or (9) take
any corporate action for the purpose of effecting any of the foregoing;
(vi) a proceeding or case shall be commenced, without
the application or consent of Company in any court of competent jurisdiction,
seeking (1) the liquidation, reorganization, dissolution, winding up or
composition or readjustment of its debts, (2) the appointment of a trustee,
receiver, custodian, liquidator or the like of it or for all or any substantial
part of its assets, or (3) similar relief in respect of Company, under any law
providing for the relief of debtors, and such proceeding or case shall continue
undismissed, or unstayed and in effect, for a period of sixty (60) days; or an
order for relief shall be entered in an involuntary case under the United States
Bankruptcy Code or other similar law or regulation, against Company; or action
under the laws of any jurisdiction affecting Company analogous to any of the
foregoing shall be taken with respect to Company and shall continue unstayed and
in effect for any period of sixty (60) days; or
(vii) final judgment for the payment of money shall
be rendered by a court of competent jurisdiction against Company and Company
shall not discharge the same or provide for its discharge in accordance with its
terms, or procure a stay of execution thereof within sixty (60) days from the
date of entry thereof and within said period of sixty (60) days, or such longer
period during which execution of such judgment shall have been stayed, appeal
therefrom and cause the execution thereof to be stayed during such appeal, and
such judgment together with all other such judgments shall exceed in the
aggregate US$50,000.
then (x) upon the occurrence of any Event of Default described in Section
7(a)(vi) or (vii), the unpaid principal amount of the loan, together with the
interest accrued thereon and all other amounts payable by Company under this
Agreement, shall automatically become immediately due and payable, without
presentment, demand, protest, notice of acceleration or intent to accelerate or
other requirements of any kind, all of which are hereby expressly waived by
Company or (y) upon the occurrence of any other Event of Default, Holder may, by
notice to Company, declare the unpaid principal amount of the loan to be, and
the same shall forthwith become, due and payable, together with the interest
accrued thereon and all other amounts payable by Company hereunder. Failure by
Holder to indicate any Event of Default in any one notice shall not preclude
Holder from indicating such omitted Event or Events of Default in future notices
and shall not relieve Company of any liability under this Agreement, nor
constitute a waiver of Holder's rights under this Agreement.
(b) Suits for Enforcement. If any Event of Default shall have
occurred and be continuing, Holder may proceed to protect and enforce its rights
against Company, subject to the terms of the Intercreditor Agreement, either by
suit in equity or by action at law, or both, whether for the specific
performance of any covenant or agreement contained in this Agreement or in aid
of the exercise of any power granted in this Agreement, or Holder may proceed to
enforce the payment by Company of all sums due under this Agreement or to
enforce any other legal or equitable right of Holder including without
limitation all rights of a secured party under the UCC.
Company covenants that, if it shall default in the making of
any payment due hereunder or in the performance or observance of any agreement
contained in this Agreement, it will pay to Holder such further amounts, to the
extent lawful, to cover any reasonable costs and expenses of collection or of
otherwise enforcing Holder's rights, including without limitation the reasonable
counsel fees and costs and expenses incurred in connection with any
restructuring, negotiation, refinancing, workout, bankruptcy or other similar
transaction or proceeding. The obligations set forth in this paragraph shall
survive the payment in full of the loan.
(c) Remedies Cumulative. No remedy herein conferred upon
Holder is intended to be exclusive of any other remedy and each and every such
remedy shall be cumulative and shall be in addition to every other remedy given
hereunder or now or hereafter existing at law or in equity or by statute or
otherwise.
(d) Remedies Not Waived. No course of dealing between Company
and any other person and no delay or failure in exercising any rights hereunder
or under the loan in respect thereof shall operate as a waiver of Holder's
rights.
8. Miscellaneous.
(a) Reliance on and Survival of Representations. All
representations, warranties, covenants and agreements of Company herein shall be
deemed to be material and to have been relied upon by Holder and shall survive
the execution and delivery of this Agreement and of the securities, for so long
as the loan remains outstanding.
(b) Successors and Assigns. This Agreement shall bind and
inure to the benefit of and be enforceable by Company, Holder and each of their
respective successors and assigns, and, in addition, shall inure to the benefit
of and be enforceable by each person who shall from time to time be a holder of
the loan. Holder shall be permitted to transfer the securities being sold
hereunder in accordance with their terms and in accordance with applicable
restrictions under applicable federal and state securities laws.
(c) Notices. All notices and other communications provided for
in this Agreement shall be in writing and delivered by registered or certified
mail, postage prepaid, or delivered by overnight courier (for next business day
delivery) or telecopied, addressed as follows, or at such other address as any
of the parties hereto may hereafter designate by notice to the other parties
given in accordance with this Section:
1) if to Company:
Auxilio, Inc.
00000 Xxx Xxxxx, Xxxxx 000
Xxxxxxx Xxxxx, XX 00000
Phone: 000-000-0000
Fax: 000-000-0000
2) if to Holder:
CAMBRIA INVESTMENT FUND, LP
0000 Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xx Xxxxxxx, XX 00000
Fax: 000.000.0000
Phone: 000.000.0000
Any such notice or communication shall be deemed to have been
duly given on the fifth day after being so mailed, the next business day after
delivery by overnight courier, when received when sent by telecopy or upon
receipt when delivered personally.
(d) Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument. Signatures may be
exchanged by telecopy, with original signatures to follow. Each of the parties
hereto agrees that it will be bound by its own telecopied signature and that it
accepts the telecopied signatures of the other parties to this Agreement. The
original signature pages shall be forwarded to Holder or its counsel and Holder
or its counsel will provide all of the parties hereto with a copy of the entire
Agreement.
(e) Amendments. This Agreement may only be amended by a writing
duly executed by the parties hereto.
(f) Severability. If any term or provision of this Agreement or
any other document executed in connection herewith shall be determined to be
illegal or unenforceable, all other terms and provisions hereof and thereof
shall nevertheless remain effective and shall be enforced to the fullest extent
permitted by applicable law.
(g) Governing Law; Submission to Process. THIS AGREEMENT AND
ALL AMENDMENTS, SUPPLEMENTS, WAIVERS AND CONSENTS RELATING HERETO OR THERETO
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
CALIFORNIA WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW. THE COMPANY HEREBY
IRREVOCABLY SUBMITS ITSELF TO THE NON-EXCLUSIVE JURISDICTION OF THE STATE AND
FEDERAL COURTS SITTING IN THE STATE OF CALIFORNIA AND AGREES AND CONSENTS THAT
SERVICE OF PROCESS MAY BE MADE UPON IT IN ANY LEGAL PROCEEDINGS RELATING HERETO
BY ANY MEANS ALLOWED UNDER CALIFORNIA OR FEDERAL LAW. THE COMPANY IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT
MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH PROCEEDING BROUGHT
IN SUCH COURT AND ANY CLAIM THAT ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT HAS
BEEN BROUGHT IN AN INCONVENIENT FORUM.
(h) Entire Agreement. This Agreement and the other Loan
Documents contain the entire Agreement of the parties hereto with respect to the
transactions contemplated hereby and supersedes all previous oral and written,
and all previous contemporaneous oral negotiations, commitments and
understandings.
(i) Further Assurances. Company agrees promptly to execute and
deliver such documents and to take such other acts as are reasonably necessary
to effectuate the purposes of this Agreement.
(j) Headings. The headings contained herein are for reference
purposes only and shall not affect in any way the meaning or interpretation of
this Agreement.
(k) Assignments and Participations. Company may not assign its
rights or obligations hereunder or under the loan without the prior written
consent of Holder. Subject to compliance with applicable Federal and State
Securities laws, Holder may assign all or any portion of the loan without the
prior consent of Company. Holder may sell or agree to sell to one or more other
persons a participation in all or any part of any of the loan without the prior
consent of Company. Upon surrender of the loan, Company shall execute and
deliver one or more substitute notes in such denominations and of a like
aggregate unpaid principal amount or other amount issued to Holder and/or to
Holder's designated transferee or transferees. Holder may furnish any
information in the possession of Holder concerning Company, or any of its
respective subsidiaries, from time to time to assignees and participants
(including prospective assignees and participants).
(l) Waivers; Indemnity. Company waives presentment and demand
for payment, notice of dishonor, protest of this Agreement, notice of
acceleration or intent to accelerate, and shall pay all costs of collection when
incurred, including reasonable attorneys' fees, costs and expenses. Company
shall indemnify and hold harmless from any claim, obligation or liability
(including without limitation reasonable attorneys fees and expenses) arising
out of this Agreement or the transactions contemplated under the Loan Documents.
(m) JURY WAIVER. HOLDER AND COMPANY EACH WAIVES ANY RIGHT TO A
JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION ARISING OUT OF THE LOAN DOCUMENTS OR
ANY OF THE TRANSACTIONS CONTEMPLATED HEREIN.
(n) Interest Payments. Interest on the debt evidenced by this
Agreement will not exceed the maximum rate or amount of non-usurious interest
that may be contracted for, taken, reserved, charged, or received under law. Any
interest in excess of that maximum amount will be credited on the principal
amount or, if the principal amount has been paid, refunded. On any acceleration
or required or permitted prepayment, any excess interest above the maximum
lawful amount will be canceled automatically as of the acceleration or
prepayment, or, if the excess interest has already been paid, credited on the
principal amount, or, if the principal amount has been paid, refunded. This
provision overrides any conflicting provisions in this Agreement and all other
instruments concerning the debt.
[Signature page follows.]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year set forth above.
COMPANY:
AUXILIO, INC.
a Nevada corporation
By: ________________________________
Name: Xxxxxx X. Xxxxx
Title: Chief Executive Officer
HOLDER:
CAMBRIA INVESTMENT FUND, L.P.
a California limited partnership
By: CAMBRIA INVESTMENT ADVISORS, LLC
a California limited liability company,
its general partner
By: _____________________________
Xxxx Xxxxxxxxxx
Manager
EXHIBIT A
The Collateral shall consist of all right, title and interest of
Company in and to the following:
(a) All goods and equipment now owned or hereafter acquired, including,
without limitation, all machinery, fixtures, vehicles (including motor vehicles
and trailers), and any interest in any of the foregoing, and all attachments,
accessories, accessions, replacements, substitutions, additions, and
improvements to any of the foregoing, wherever located;
(b) All inventory, now owned or hereafter acquired, including, without
limitation, all merchandise, raw materials, parts, supplies, packing and
shipping materials, work in process and finished products including such
inventory as is temporarily out of Company's custody or possession or in transit
and including any returns upon any accounts or other proceeds, including
insurance proceeds, resulting from the sale or disposition of any of the
foregoing and any documents of title representing any of the above, and
Company's books relating to any of the foregoing;
(c) All contract rights and general intangibles now owned or hereafter
acquired, including, without limitation, all leases, license agreements,
franchise agreements, blueprints, drawings, purchase orders, customer lists,
route lists, infringements, claims, computer programs, computer discs, computer
tapes, literature, reports, catalogs, design rights, income tax refunds,
payments of insurance and rights to payment of any kind, all copyrights,
copyright registrations and applications, copyright renewals or extensions,
patents and patent applications, all reissues, divisions, continuations,
renewals, extensions and continuations-in-part of all patents or patent
applications, all trademarks, trade names, trade styles, service marks, logos,
together with product lines and goodwill of the business connected with the use
of, or otherwise symbolized by, each such trade name, trademark and service
xxxx, trademark and service xxxx registrations and applications for trademark
and service xxxx registrations, all renewals and extensions of any trademarks,
trade names, trade styles, and service marks, all trade secret rights, including
all rights to unpatented inventions, know-how, operating manuals, license rights
and agreements and confidential information, all mask work or similar rights
available for the protection of semiconductor chips, and all rights in the
foregoing intellectual property to income, royalties, damages, and other
payments, and all rights to xxx for all past, present and future infringements,
and all rights otherwise accruing under or pertaining to any of the foregoing
throughout the world ("Intellectual Property");
(d) All now existing and hereafter arising accounts, contract rights,
royalties, license rights and all other forms of obligations owing to Company
arising out of the sale or lease of goods, the licensing of technology or the
rendering of services by Company, whether or not earned by performance, and any
and all credit insurance, guaranties, and other security therefor, as well as
all merchandise returned to or reclaimed by Company and Company's books relating
to any of the foregoing;
(e) All documents, cash, deposit accounts, securities, letters of
credit, certificates of deposit, instruments and chattel paper now owned or
hereafter acquired and Company's books relating to the foregoing; and
(f) Any and all claims, rights and interests in any of the above and
all substitutions for, additions and accessions to and proceeds thereof.
Schedule 3(l)
None
