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EXHIBIT 10.7
AMENDED AND RESTATED COMMERCIAL SECURITY AGREEMENT
(FIBT Form 000-70034 (Rev. 9/86))
Dated as of March 1, 1996
Debtor(s) Secured Party
BEARCOM, INC. First Interstate Bank of Texas, N.A.
00000 Xxxxxxxx Xxxx 0000 Xxxx Xxxxxx
Xxxxxx, Xxxxx 00000 Xxxxxx, Xxxxx 00000
(HEREINAFTER REFERRED TO AS "DEBTOR" (HEREINAFTER REFERRED TO AS "SECURED
WHETHER ONE OR MORE) PARTY")
WHEREAS, Debtor and Secured Party desire to amend and restate that
certain Commercial Security Agreement dated October 2, 1994 executed by Debtor
(f/k/a Page-Com, Inc.) in favor of Secured Party;
FOR VALUE RECEIVED, the receipt and sufficiency of which is hereby
acknowledged, Debtor grants to Secured Party the security interest (and the
pledges and assignments as applicable) hereinafter set forth and agrees with
Secured Party as follows:
a. OBLIGATIONS SECURED. The security interest and pledges
and assignments as applicable granted hereby are to secure
punctual payment and performance of the following: (i) that
certain Guaranty Agreement of even date herewith executed by
Debtor in favor of Secured Party, and any and all extensions,
renewals, modifications and rearrangements thereof; and (ii)
any and all other indebtedness, liabilities and obligations
whatsoever and of whatever nature of Debtor to Secured Party
whether direct or indirect, absolute or contingent, primary
or secondary, due or to become due and whether now existing
or hereafter arising and howsoever evidenced or acquired,
whether joint or several, or joint and several (all of which
are herein separately and collectively referred to as the
"Obligations"). Debtor acknowledges that the security
interest (and pledges and assignments as applicable) hereby
granted shall secure all future advances from Secured Party
to BearCom, Inc., as well as any and all other indebtedness,
liabilities and obligations of Debtor to Secured Party
whether now in existence or hereafter arising.
b. USE OF COLLATERAL. Debtor represents, warrants and
covenants that the Collateral will be used by the Debtor
primarily for business use, unless otherwise specified as
follows:
______ Personal, family or household purposes;
______ Farming operations.
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c. DESCRIPTION OF COLLATERAL. Debtor hereby grants to
Secured Party a security interest in (and hereby pledges and
assigns as applicable) and agrees that Secured Party shall
continue to have a security interest in (and a pledge and
assignment as applicable), the following property, to-wit:
(DEBTOR TO INITIAL APPROPRIATE BLANKS)
[X] ALL ACCOUNTS. A security interest in all accounts now owned
--- --- or existing as well as any and all that may hereafter arise
or be acquired by Debtor, and all the proceeds and products
thereof, including without limitation, all notes, drafts,
acceptances, instruments and chattel paper arising therefrom,
and all returned or repossessed goods arising from or
relating to any such accounts, or other proceeds of any sale
or other disposition of inventory.
[X] ALL INVENTORY. A security interest in all of Debtor's
--- --- inventory, including all goods, merchandise, raw materials,
goods in process, finished goods and other tangible personal
property, wheresoever located, now owned or hereafter
acquired and held for sale or lease or furnished or to be
furnished under contracts for service or used or consumed in
Debtor's business and all additions and accessions thereto
and contracts with respect thereto and all documents of title
evidencing or representing any part thereof, and all products
and proceeds thereof, including, without limitation, all of
such which is now or hereafter located at the following
locations: (give locations)
00000 Xxxxxxxx Xxxx
Xxxxxx, Xxxxx 00000
0000 Xxxxxxxx Xxxxxx
Xxxxx Xxxx, Xxxxxxxxxx 00000
[X] ALL EQUIPMENT. A security interest in all equipment of every
--- --- nature and description whatsoever now owned or hereafter
acquired by Debtor including all appurtenances and additions
thereto and substitutions therefor, wheresoever located,
including all tools, parts and accessories used in connection
therewith.
[X] GENERAL INTANGIBLES. A security interest in all general
--- --- intangibles and other personal property now owned or
hereafter acquired by Debtor other than goods, accounts,
chattel paper, documents and instruments.
[X] CHATTEL PAPER. A security interest in all of Debtor's
--- --- interest under chattel paper, lease agreements and other
instruments or documents, whether now existing or owned by
Debtor or hereafter arising or acquired by Debtor, evidencing
both a debt and security interest in or lease of specific
goods.
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[X] INSTRUMENTS. A pledge and assignment of and security interest
--- --- in all of Debtor's now owned or existing as well as hereafter
acquired or arising instruments and documents.
--- --- OTHER. A security interest in all of Debtor's interest, now
owned or hereafter acquired, in and to the property described
below: (give description)
The term "Collateral" as used in this Agreement shall mean and include,
and the security interest (and pledge and assignment as applicable) shall cover,
all of the foregoing property, as well as any accessions, additions and
attachments thereto and the proceeds and products thereof, including without
limitation, all cash, general intangibles, accounts, inventory, equipment,
fixtures, farm products, notes, drafts, acceptances, securities, instruments,
chattel paper, insurance proceeds payable because of loss or damage, or other
property, benefits or rights arising therefrom, and in and to all returned or
repossessed goods arising from or relating to any of the property described
herein or other proceeds of any sale or other disposition of such property.
As additional security for the punctual payment and performance of the
Obligations, and as part of the Collateral, Debtor hereby grants to Secured
Party a security interest in, and a pledge and assignment of, any and all money,
property, deposit accounts, accounts, securities, documents, chattel paper,
claims, demands, instruments, items or deposits of the Debtor, and each of them,
or to which any of them is a party, now held or hereafter coming within Secured
Party's custody or control, including, without limitation, all certificates of
deposit and other depository accounts, whether such have matured or the exercise
of Secured Party's rights results in loss of interest or principal or other
penalty on such deposits, but excluding deposits subject to tax penalties if
assigned. Without prior notice to or demand upon the Debtor, Secured Party may
exercise its rights granted above at any time when a default has occurred or
Secured Party deems itself insecure. Secured Party's rights and remedies under
this paragraph shall be in addition to and cumulative of any other rights or
remedies at law and equity, including, without limitation, any rights of set-off
to which Secured Party may be entitled.
d. REPRESENTATIONS, WARRANTIES AND COVENANTS OF DEBTOR.
Debtor represents and warrants as follows:
i. OWNERSHIP; NO ENCUMBRANCES. Except for the
security interest (and pledges and assignments as
applicable) granted hereby, the Debtor is, and as to any
property acquired after the date hereof which is
included within the Collateral, Debtor will be, the
owner of all such Collateral free and clear from all
charges, liens, security interests, adverse claims and
encumbrances of any and every nature whatsoever.
ii. NO FINANCING STATEMENTS. There is no financing
statement or similar filing now on file in any public
office covering any part of the Collateral, and Debtor
will not execute and there will not be on file in any
public office any financing statement or similar filing
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except the financing statements filed or to be filed in
favor of Secured Party.
iii. ACCURACY OF INFORMATION. All information furnished
to Secured Party concerning Debtor, the Collateral and
the Obligations, or otherwise for the purpose of
obtaining or maintaining credit, is or will be at the
time the same is furnished, accurate and complete in all
material respects.
iv. AUTHORITY. Debtor has full right and authority to
execute and perform this Agreement and to create the
security interest (and pledges and assignment as
applicable) created by this Agreement. The making and
performance by Debtor of this Agreement will not violate
any articles of incorporation, bylaws or similar
document respecting Debtor, any provision of law, any
order of court or governmental agency, or any indenture
or other agreement to which Debtor is a party, or by
which Debtor or any of Debtor's property is bound, or be
in conflict with, result in a breach of or constitute
(with due notice and/or lapse of time) a default under
any such indenture or other agreement, or result in the
creation or imposition of any charge, lien, security
interest, claim or encumbrance of any and every nature
whatsoever upon the Collateral, except as contemplated
by this Agreement.
v. ADDRESSES. The address of Debtor designated at the
beginning of this Agreement is Debtor's place of
business if Debtor has only one place of business;
Debtor's chief executive office if Debtor has more than
one place of business; or Debtor's residence if Debtor
has no place of business. Debtor agrees not to change
such address without advance written notice to Secured
Party.
e. GENERAL COVENANTS. Debtor covenants and agrees as
follows:
i. OPERATION OF THE COLLATERAL. Debtor agrees to
maintain and use the Collateral solely in the conduct of
its own business, in a careful and proper manner, and in
conformity with all applicable permits or licenses.
Debtor shall comply in all respects with all applicable
statutes, laws, ordinances and regulations. Debtor shall
not use the Collateral in any unlawful manner or for any
unlawful purposes, or in any manner or for any purpose
that would expose the Collateral to unusual risk, or to
penalty, forfeiture or capture, or that would render
inoperative any insurance in connection with the
Collateral.
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ii. CONDITION. Debtor shall maintain, service and
repair the Collateral so as to keep it in good operating
condition. Debtor shall replace within a reasonable time
all parts that may be worn out, lost, destroyed or
otherwise rendered unfit for use, with appropriate
replacement parts. Debtor shall obtain and maintain in
good standing at all times all applicable permits,
licenses, registrations and certificates respecting the
Collateral.
iii. ASSESSMENTS. Debtor shall promptly pay when due all
taxes, assessments, license fees, registration fees, and
governmental charges levied or assessed against Debtor
or with respect to the Collateral or any part thereof.
iv. NO ENCUMBRANCES. Debtor agrees not to suffer or
permit any charge, lien, security interest, adverse
claim or encumbrance of any and every nature whatsoever
against the Collateral or any part thereof.
v. NO REMOVAL. Except as otherwise provided in this
Agreement, Debtor shall not remove the Collateral from
the county or counties designated at the beginning of
this Agreement without Secured Party's prior written
consent.
vi. NO TRANSFER. Except as otherwise provided in this
Agreement with respect to inventory, Debtor shall not,
without the prior written consent of Secured Party,
sell, assign, transfer, lease, charter, encumber,
hypothecate or dispose of the Collateral, or any part
thereof, or interest therein, or offer to do any of the
foregoing.
vii. NOTICES AND REPORTS. Debtor shall promptly notify
Secured Party in writing of any change in the name,
identity or structure of Debtor, any charge, lien,
security interest, claim or encumbrance asserted against
the Collateral, any litigation against Debtor or the
Collateral, any theft, loss, injury or similar incident
involving the Collateral, and any other material matter
adversely affecting Debtor or the Collateral. Debtor
shall furnish such other reports, information and data
regarding Debtor's financial condition and operations,
the Collateral and such other matters as Secured Party
may request from time to time.
viii. LANDLORD'S WAIVERS. Debtor shall furnish to Secured
Party, if requested, a landlord's waiver of all liens
with respect to any Collateral covered by this Agreement
that is or may be located upon leased premises, such
landlord's waivers to be in such form and upon such
terms as are acceptable to Secured Party.
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ix. ADDITIONAL FILINGS. Debtor agrees to execute and
deliver such financing statement or statements, or
amendments thereof or supplements thereto, or other
documents as Secured Party may from time to time require
in order to comply with the Texas Uniform Commercial
Code (or other applicable state law of the jurisdiction
where any of the Collateral is located) and to preserve
and protect the Secured Party's rights to the
Collateral.
x. PROTECTION OF COLLATERAL. Secured Party, at its
option, whether before or after default, but without any
obligation whatsoever to do so, may (a) discharge taxes,
claims, charges, liens, security interests, assessments
or other encumbrances of any and every nature whatsoever
at any time levied, placed upon or asserted against the
Collateral, (b) place and pay for insurance on the
Collateral, including insurance that only protects
Secured Party's interest, (c) pay for the repair,
improvement, testing, maintenance and preservation of
the Collateral, (d) pay any filing, recording,
registration, licensing or certification fees or other
fees and charges related to the Collateral, or (e) take
any other action to preserve and protect the Collateral
and Secured Party's rights and remedies under this
Agreement as Secured Party may deem necessary or
appropriate. Debtor agrees that Secured Party shall have
no duty or obligation whatsoever to take any of the
foregoing action. Debtor agrees to promptly reimburse
Secured Party upon demand for any payment made or any
expense incurred by the Secured Party pursuant to this
authorization. These payments and expenditures, together
with interest thereon from date incurred until paid by
Debtor at the maximum contract rate allowed under
applicable laws, which Debtor agrees to pay, shall
constitute additional Obligations and shall be secured
by and entitled to the benefits of this Agreement.
xi. INSPECTION. Debtor shall at all reasonable times
allow Secured Party by or through any of its officers,
agents, attorneys or accountants, to examine the
Collateral, wherever located, and to examine and make
extracts from Debtor's books and records.
xii. FURTHER ASSURANCES. Debtor shall do, make, procure,
execute and deliver all such additional and further
acts, things, deeds, interests and assurances as Secured
Party may require from time to time to protect, assure
and enforce Secured Party's rights and remedies.
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xiii. INSURANCE. Debtor shall have and maintain
insurance at all time with respect to all tangible
Collateral insuring against risks of fire (including
so-called extended coverage), theft and other risks as
Secured Party may require, containing such terms, in
such form and amounts and written by such companies as
may be satisfactory to Secured Party, all of such
insurance to contain loss payable clauses in favor of
Secured Party as its interest may appear. All policies
of insurance shall provide for ten (10) days' written
minimum cancellation notice to Secured Party and at the
request of Secured Party shall be delivered to and held
by it. Secured Party is hereby authorized to act as
attorney for Debtor in obtaining, adjusting, settling
and canceling such insurance and endorsing any drafts or
instruments. Secured Party shall be authorized to apply
the proceeds from any insurance to the Obligations
secured hereby whether or not such Obligations are then
due and payable. Debtor specifically authorizes Secured
Party to disclose information from the policies of
insurance to prospective insurers regarding the
Collateral.
xiv. ADDITIONAL COLLATERAL. If Secured Party should at
any time be of the opinion that the Collateral is
impaired, not sufficient or has declined or may decline
in value, or should Secured Party deem payment of the
Obligations to be insecure, then Secured Party may call
for additional security satisfactory to Secured Party,
and Debtor promises to furnish such additional security
forthwith. The call for additional security may be oral,
by telegram, or United States mail addressed to Debtor,
and shall not affect any other subsequent right of
Secured Party to exercise the same.
f. ADDITIONAL PROVISIONS REGARDING ACCOUNTS. The following
provisions shall apply to all accounts included within the
Collateral:
i. DEFINITIONS. The term "account", as used in this
Agreement, shall have the same meaning as set forth in
the Uniform Commercial Code of Texas in effect as of the
date of execution hereof, and as set forth in any
amendment to the Uniform Commercial Code of Texas to
become effective after the date of execution hereof, and
also shall include all present and future notes,
instruments, documents, general intangibles, drafts,
acceptances and chattel paper of Debtor, and the
proceeds thereof.
ii. ADDITIONAL WARRANTIES. As of the time any account
becomes subject to the security interest (or pledge of
assignment as applicable) granted hereby, Debtor shall
be deemed further to have
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warranted as to each and all of such accounts as
follows: (a) each account and all papers and documents
relating thereto are genuine and in all respects what
they purport to be; (b) each account is valid and
subsisting and arises out of a bona fide sale of goods
sold and delivered to, or out of and for services
theretofore actually rendered by the Debtor to, the
account debtor named in the account; (c) the amount of
the account represented as owing is the correct amount
actually and unconditionally owing except for normal
cash discounts and is not subject to any set-offs,
credits, defenses or counter-charges; and (d) Debtor is
the owner thereof free and clear of any charges, liens,
security interests, adverse claims and encumbrances of
any and every nature whatsoever.
iii. COLLECTION OF ACCOUNTS. Secured Party shall have
the right in its own name or in the name of the Debtor,
whether before or after default, to require Debtor
forthwith to transmit all proceeds of collection of
accounts to Secured Party, to notify any and all account
debtors to make payments of the accounts directly to
Secured Party, to demand, collect, receive, receipt for,
xxx for, compound and give acquittal for, any and all
amounts due or to become due on the accounts and to
endorse the name of the Debtor on all commercial paper
given in payment or part payment thereof, and in Secured
Party's discretion to file any claim or take any other
action or proceeding that Secured Party may deem
necessary or appropriate to protect and preserve and
realize upon the accounts and related Collateral. Unless
and until Secured Party elects to collect accounts, and
the privilege of Debtor to collect accounts is revoked
by Secured Party in writing, Debtor shall continue to
collect accounts, account for same to Secured Party, and
shall not commingle the proceeds of collection of
accounts with any funds of the Debtor. In order to
assure collection of accounts in which Secured Party has
a security interest (or pledge or assignment of as
applicable) hereunder, Secured Party may notify the post
office authorities to change the address for delivery of
mail addressed to Debtor to such address as Secured
Party may designate, and to open and dispose of such
mail and receive the collections of accounts included
herewith. Secured Party shall have no duty or obligation
whatsoever to collect any account, or to take any other
action to preserve or protect the Collateral; however,
should Secured Party elect to collect any account or
take possession of any Collateral, Debtor releases
Secured Party from any claim or claims for loss or
damage arising from any act or omission in connection
therewith.
iv. IDENTIFICATION AND ASSIGNMENT OF ACCOUNTS. Upon
Secured Party's request, whether before or after
default, Debtor shall take
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such action and execute and deliver such documents as
Secured Party may reasonably request in order to
identify, confirm, xxxx, segregate and assign accounts
and to evidence Secured Party's interest in same.
Without limitation of the foregoing, Debtor, upon
request, agrees to assign accounts to Secured Party,
identify and xxxx accounts as being subject to the
security interest (or pledge or assignment as
applicable) granted hereby, xxxx Debtor's books and
records to reflect such assignments, and forthwith to
transmit to Secured Party in the form as received by
Debtor any and all proceeds of collection of such
accounts.
v. ACCOUNT REPORTS. Upon Secured Party's request,
Debtor will deliver to Secured Party, prior to the tenth
(10th) day of each month, or on such other frequency as
Secured Party may request, a written report in form and
content satisfactory to Secured Party, showing a listing
and aging of accounts and such other information as
Secured Party may request from time to time. Debtor
shall immediately notify Secured Party of the assertion
by any account debtor of any set-off, defense or claim
regarding an account or any other matter adversely
affecting an account.
vi. SEGREGATION OF RETURNED GOODS. Returned or
repossessed goods arising from or relating to any
accounts included within the Collateral shall if
requested by Secured Party be held separate and apart
from any other property. Debtor shall as often as
requested by Secured Party, but not less often than
weekly even though no special request has been made,
report to Secured Party the appropriate identifying
information with respect to any such returned or
repossessed goods relating to accounts included in
assignments or identifications made pursuant hereto.
g. ADDITIONAL PROVISIONS REGARDING INVENTORY. The following
provisions shall apply to all inventory included within the
Collateral:
i. INVENTORY REPORTS. Upon request by Secured Party,
Debtor will deliver to Secured Party, prior to the tenth
(10th) day of each month, or on such other frequency as
Secured Party may request, a written report in form and
content satisfactory to Secured Party, with respect to
the preceding month or other applicable period, showing
Debtor's opening inventory, inventory acquired,
inventory sold, inventory returned, inventory used in
Debtor's business, closing inventory, any other
inventory not within the preceding categories, and such
other information as Secured Party may request from time
to time. Debtor shall immediately notify Secured Party
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of any matter adversely affecting the inventory,
including, without limitation, any event causing loss or
depreciation in the value of the inventory and the
amount of such possible loss or depreciation.
ii. LOCATION OF INVENTORY. Debtor will promptly notify
Secured Party in writing of any addition to, change in
or discontinuance of its place(s) of business as shown
in this agreement, the places at which inventory is
located as shown herein, the location of its chief
executive office and the location of the office where it
keeps its records as set forth herein. All Collateral
will be located at the place(s) of business shown at the
beginning of this agreement as modified by any written
notice(s) given pursuant hereto.
iii. USE OF INVENTORY. Unless and until the privilege
of Debtor to use inventory in the ordinary course of
Debtor's business is revoked by Secured Party in the
event of default or if Secured Party deems itself
insecure, Debtor may use the inventory in any manner not
inconsistent with this Agreement, may sell that part of
the Collateral consisting of inventory provided that all
such sales are in the ordinary course of business, and
may use and consume any raw materials or supplies that
are necessary in order to carry on Debtor's business. A
sale in the ordinary course of business does not include
a transfer in partial or total satisfaction of a debt.
iv. ACCOUNTS AS PROCEEDS. All accounts that are
proceeds of the inventory included within the Collateral
shall be subject to all of the terms and provisions
hereof pertaining to accounts.
v. PROTECTION OF INVENTORY. Debtor shall take all
action necessary to protect and preserve the inventory.
h. ADDITIONAL PROVISIONS REGARDING SECURITIES AND SIMILAR
COLLATERAL. The following provisions shall apply to all
securities and similar property included within the
Collateral:
i. ADDITIONAL WARRANTIES. As to each and all
securities and similar property included within the
Collateral (including securities hereafter acquired that
are part of the Collateral), Debtor further represents
and warrants, as of the time of. delivery of same to
Secured Party, as follows: (a) such securities are
genuine, validly issued and outstanding, fully paid and
nonassessable, and are not issued in violation of the
preemptive rights of any person or of any agreement by
which the issuer or obligor thereof or Debtor is bound;
(b) such securities are not subject to any interest,
option or
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right of any third person; (c) such securities are in
compliance with applicable law concerning form, content
and manner of preparation and execution; and (d) Debtor
acquired and holds the securities in compliance with all
applicable laws and regulations.
ii. DIVIDENDS AND PROCEEDS. Any and all payments,
dividends, other distributions (including stock
redemption proceeds), or other securities in respect of
or in exchange for the Collateral, whether by way of
dividends, stock dividends, recapitalizations, mergers,
consolidations, stock splits, combinations or exchanges
of shares or otherwise, received by Debtor shall be held
by Debtor in trust for Secured Party and Debtor shall
immediately deliver same to Secured Party to be held as
part of the Collateral. Debtor may retain ordinary cash
dividends unless and until Secured Party requests that
same be paid and delivered to Secured Party (which
Secured Party may request either before or after
default), but shall not pay or distribute any dividends
to its shareholders.
iii. COLLECTIONS. Secured Party shall have the right at
any time and from time to time (whether before or after
default) to notify and direct the issuer or obligor to
make all payments, dividends and distributions regarding
the Collateral directly to Secured Party. Secured Party
shall have the authority to demand of the issuer or
obligor, and to receive and receipt for, any and all
payments, dividends and other distributions payable in
respect thereof, regardless of the medium in which paid
and whether they are ordinary or extraordinary. Each
issuer and obligor making payment to Secured Party
hereunder shall be fully protected in relying on the
written statement of Secured Party that it then holds a
security interest which entitles it to receive such
payment, and the receipt by Secured Party for such
payment shall be full acquittance therefor to the one
making such payment.
iv. VOTING RIGHTS. Upon default, or if Secured Party
deems itself insecure, Secured Party shall have the
right, at its discretion, to transfer to or register in
the name of Secured Party or any nominee of Secured
Party any of the Collateral, and/or to exercise any or
all voting rights as to any or all of the Collateral.
For such purposes, Debtor hereby names, constitutes and
appoints the President or any Vice President of Secured
Party as Debtor's proxy in the Debtor's name, place and
stead to vote any and all of the securities, as such
proxy may elect, for and in the name, place and stead of
Debtor, as to all matters coming before shareholders,
such proxy to be irrevocable and deemed coupled with an
interest. The rights, powers and authority of said proxy
shall remain in full force
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and effect, and shall not be rescinded, revoked,
terminated, amended or otherwise modified, until all
Obligations have been fully satisfied.
v. NO DUTY. Secured Party shall never be liable for
its failure to give notice to Debtor of default in the
payment of or upon the Collateral. Secured Party shall
have no duty to fix or preserve rights against prior
parties to the Collateral and shall never be liable for
its failure to use diligence to collect any amount
payable in respect to the Collateral, but shall be
liable only to account to Debtor for what it may
actually collect or receive thereon. Without limiting
the foregoing, it is specifically understood and agreed
that Secured Party shall have no responsibility for
ascertaining any maturities, calls, conversions,
exchanges, offers, tenders, or similar matters relating
to any of the Collateral or for informing Debtor with
respect to any of such matters (irrespective of whether
Secured Party actually has, or may be deemed to have,
knowledge thereof). The foregoing provisions of this
paragraph shall be fully applicable to all securities or
similar property held in pledge hereunder, irrespective
of whether Secured Party may have exercised any right to
have such securities or similar property registered in
its name or in the name of a nominee.
vi. FURTHER ASSURANCES. Debtor agrees to execute such
stock powers, endorse such instruments, or execute such
additional pledge agreements or other documents as may
be required by the Secured Party in order effectively to
grant to Secured Party the security interest in (and
pledge and assignment of) the Collateral and to enforce
and exercise Secured Party's rights regarding same.
vii. SECURITIES LAWS. Debtor hereby agrees to cooperate
fully with Secured Party in order to permit Secured
Party to sell, at foreclosure or other private sale, the
Collateral pledged hereunder. Specifically, Debtor
agrees to fully comply with the securities laws of the
United States and of the State of Texas and to take such
action as may be necessary to permit Secured Party to
sell or otherwise transfer the securities pledged
hereunder in compliance with such laws. Without limiting
the foregoing, Debtor, at its own expense, upon request
by Secured Party, agrees to effect and obtain such
registrations, filings, statements, rulings, consents,
and other matters as Secured Party may request.
viii. POWER OF ATTORNEY. Debtor hereby makes, constitutes
and appoints Secured Party or its nominee, its true and
lawful attorney in fact and in its name, place, and
stead, and on its behalf, and for
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its use and benefit to complete, execute and file with
the United States Securities and Exchange Commission one
or more notices of proposed sale of securities pursuant
to Rule 144 under the Securities Act of 1933 and/or any
similar filings or notices with any applicable state
agencies, and said attorney in fact shall have full
power and authority to do, take and perform all and
every act and thing whatsoever requisite, proper or
necessary to be done, in the exercise of the rights and
powers herein granted, as fully to all intents and
purposes as Debtor might or could do if personally
present. This power shall be irrevocable and deemed
coupled with an interest. The rights, powers and
authority of said attorney in fact herein granted shall
commence and be in full force and effect from the date
of this agreement, and such rights, powers and authority
shall remain in full force and effect, and this power of
attorney shall not be rescinded, revoked, terminated,
amended or otherwise modified, until all Obligations
have been fully satisfied.
ix. PRIVATE SALES. Because of the Securities Act of
1933, as amended, or any other laws or regulations,
there may be legal restrictions or limitations affecting
Secured Party in any attempts to dispose of certain
portions of the Collateral in the enforcement of its
rights and remedies hereunder. For these reasons Secured
Party is hereby authorized by Debtor, but not obligated,
in the event any default hereunder, to sell all or any
part of the Collateral at private sale, subject to
investment letter or in any other manner which will not
require the Collateral, or any part thereof, to be
registered in accordance with the securities Act of
1933, as amended, or the rules and regulations
promulgated thereunder, or any other law or regulation.
Secured Party is also hereby authorized by Debtor, but
not obligated, to take such actions, give such notices,
obtain such rulings and consents, and do such other
things as Secured Party may deem appropriate in the
event of a sale or disposition of any of the Collateral.
Debtor clearly understands that Secured Party may in its
discretion approach a restricted number of potential
purchasers and that a sale under such circumstances may
yield a lower price for the Collateral or any part or
parts thereof than would otherwise be obtainable if same
were registered and sold in the open market, and Debtor
agrees that such private sales shall constitute a
commercially reasonable method of disposing of the
Collateral.
i. ADDITIONAL PROVISIONS REGARDING CERTIFICATES OF DEPOSIT
AND SIMILAR COLLATERAL. The following provisions shall apply
to certificates of deposit and similar property included
within the Collateral:
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i. COLLECTION OF DEPOSITS. Debtor agrees that
Secured Party may, at any time (whether before or after
default) and in its sole discretion, surrender for
payment and obtain payment of any portion of the
Collateral, whether such have matured or the exercise of
Secured Party's rights results in loss of interest or
principal or other penalty on such deposits, and, in
connection therewith, cause payment to be made directly
to Secured Party.
ii. NOTICE TO THIRD PARTY ISSUER. With regard to any
certificates of deposit or similar Collateral for which
Secured Party is not the issuer, Debtor agrees to notify
the issuer or obligor of the interests hereby granted to
Secured Party and to obtain from such issuer or obligor
acknowledgement of the interests in favor of Secured
Party and the issuer's or obligor's agreement to waive
in favor of Secured Party any and all rights of set-off
or similar rights or remedies to which such issuer or
obligor may be entitled, and, in connection therewith,
to execute and cause the issuer or obligor to execute,
any and all acknowledgments, waivers and other
agreements in such form and upon such terms as Secured
Party may request.
iii. PROCEEDS. Any and all replacement or renewal
certificates, instruments, or other benefits or proceeds
related to the Collateral that are received by Debtor
shall be held by Debtor in trust for Secured Party and
immediately delivered to Secured Party to be held as
part of the Collateral.
iv. NO DUTY. Secured Party shall never be liable for
its failure to give notice to Debtor of default in the
payment of or upon the Collateral. Secured Party shall
have no duty to fix or preserve rights against prior
parties to the Collateral and shall never be liable for
its failure to use diligence to collect any amount
payable in respect to the Collateral, but shall be
liable only to account to Debtor for what it may
actually collect or receive thereon. Without limiting
the foregoing, it is specifically understood and agreed
that Secured Party shall have no responsibility for
ascertaining any maturities or similar matters relating
to any of the Collateral or for informing Debtor with
respect to any of such matters (irrespective of whether
Secured Party actually has, or may be deemed to have,
knowledge thereof).
j. EVENTS OF DEFAULT. Debtor shall be in default hereunder
upon the happening of any of the following events or
conditions: (i) non-payment when due (whether by acceleration
of maturity or otherwise) of any payment of principal,
interest or other amount due on any Obligation;
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(ii) the occurrence of any event which under the terms of any
evidence of indebtedness, indenture, loan agreement, security
agreement or similar instrument permits the acceleration of
maturity of any obligation of Debtor or BearCom, Inc.
(whether to Secured Party or to others); (iii) any
representation or warranty made by Debtor to Secured Party in
connection with this Agreement, the Collateral or the
Obligations, or in any statements or certificates, proves
incorrect in any material respect as of the date of the
making or the issuance thereof; (iv) default occurs in the
observance or performance of, or if Debtor fails to furnish
adequate evidence of performance of, any provision of this
Agreement or of any note, assignment, transfer, other
agreement, document or instrument delivered by Debtor to
Secured Party in connection with this Agreement, the
Collateral or the Obligations; (v) death, dissolution,
liquidation, termination of existence, insolvency, business
failure or winding-up of Debtor or any maker, endorser,
guarantor, surety or other party liable in any capacity for
any of the Obligations; (vi) the commission of an act of
bankruptcy by, or the application for appointment of a
receiver or any other legal custodian for any part of the
property of, assignment for the benefit of creditors by, or
the commencement of any proceedings under any bankruptcy,
arrangement, reorganization, insolvency or similar laws for
the relief of debtors by or against, the Debtor or any maker,
endorser, guarantor, surety or other party primarily or
secondarily liable for any of the Obligations; (vii) the
Collateral becomes, in the judgment of Secured Party,
impaired, unsatisfactory or insufficient in character or
value; or (viii) the filing of any levy, attachment,
execution, garnishment or other process against the Debtor or
any of the Collateral or any maker, endorser, guarantor,
surety, or other party liable in any capacity for any of the
Obligations.
k. REMEDIES. Upon the occurrence of an event of default,
or if Secured Party deems payment of the Obligations to be
insecure, Secured Party, at its option, shall be entitled to
exercise any one or more of the following remedies (all of
which are cumulative):
i. DECLARE OBLIGATIONS DUE. Secured Party, at its
option, may declare the Obligations or any part thereof
immediately due and payable, without demand, notice of
intention to accelerate, notice of acceleration, notice
of non-payment, presentment, protest, notice of
dishonor, or any other notice whatsoever, all of which
are hereby waived by Debtor and any maker, endorser,
guarantor, surety or other party liable in any capacity
for any of the Obligations.
ii. REMEDIES. Secured Party shall have all of the
rights and remedies provided for in this Agreement and
in any other agreements executed by Debtor, the rights
and remedies of the Uniform Commercial Code of Texas,
and any and all of the rights
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and remedies at law and in equity, all of which shall
be. deemed cumulative. Without limiting the foregoing,
Debtor agrees that Secured Party shall have the right
to: (a) require Debtor to assemble the Collateral and
make it available to Secured Party at a place designated
by Secured Party that is reasonably convenient to both '
parties, which Debtor agrees to do; (b) peaceably take
possession of the Collateral and remove same, with or
without judicial process; (c) without removal, render
equipment included within the Collateral unusable, and
dispose of the Collateral on the Debtor's premises; (d)
sell, lease or otherwise dispose of the Collateral, at
one or more locations, by public or private proceedings,
for cash or credit, without assumption of credit risk;
and/or (e) whether before or after default, collect and
receipt for, compound, compromise, and settle, and give
releases, discharges and acquittances with respect to,
any and all amounts owed by any person or entity with
respect to the Collateral. Unless the Collateral is
perishable or threatens to decline speedily in value or
is of a type customarily sold on a recognized market,
Secured Party will send Debtor reasonable notice of the
time and place of any public sale or of the time after
which any private sale or other disposition will be
made. Any requirement of reasonable notice to Debtor
shall be met if such notice is mailed, postage prepaid,
to Debtor at the address of Debtor designated at the
beginning of this Agreement, at least five (5) days
before the day of any public sale or at least five (5)
days before the time after which any private sale or
other disposition will be made.
iii. EXPENSES. Debtor shall be liable for and agrees to
pay the reasonable expenses incurred by Secured Party in
enforcing its rights and remedies, in retaking, holding,
testing, repairing, improving, selling, leasing or
disposing of the Collateral, or like expenses,
including, without limitation, attorneys' fees and legal
expenses incurred by Secured Party. These expenses,
together with interest thereon from date incurred until
paid by Debtor at the maximum contract rate allowed
under applicable laws, which Debtor agrees to pay, shall
constitute additional Obligations and shall be secured
by and entitled to the benefits of this Agreement.
iv. PROCEEDS; SURPLUS; DEFICIENCIES. Proceeds received
by Secured Party from disposition of the Collateral
shall be applied toward Secured Party's expenses and
other Obligations in such order or manner as Secured
Party may elect. Debtor shall be entitled to any surplus
if one results after lawful application of the proceeds.
Debtor shall remain liable for any deficiency.
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v. REMEDIES CUMULATIVE. The rights and remedies of
Secured Party are cumulative and the exercise of any one
or more of the rights or remedies shall not be deemed an
election of rights or remedies or a waiver of any other
right or remedy. Secured Party may remedy any default
and may waive any default without waiving the default
remedied or without waiving any other prior or
subsequent default.
l. OTHER AGREEMENTS.
i. SAVINGS CLAUSE. Notwithstanding any provision to
the contrary herein, or in any of the documents
evidencing the Obligations or otherwise relating
thereto, no such provision shall require the payment or
permit the collection of interest in excess of the
maximum permitted by applicable usury laws. If any such
excessive interest is so provided for, then in such
event (i) the provisions of this paragraph shall govern
and control, (ii) neither the Debtor nor his heirs,
legal representatives, successors or assigns or any
other party liable for the payment thereof, shall be
obligated to pay the amount of such interest to the
extent that is in excess of the maximum amount permitted
by law, (iii) any such excess interest that may have
been collected shall be, at the option of the holder of
the instrument evidencing the Obligations, either
applied as a credit against the then unpaid principal
amount thereof or refunded to the maker thereof, and
(iv) the effective rate of interest shall be
automatically reduced to the maximum lawful rate under
applicable usury laws as now or hereafter construed by
the courts having jurisdiction.
ii. JOINT AND SEVERAL RESPONSIBILITY. If this Security
Agreement is executed by more than one Debtor, the
obligations of all such Debtors shall be joint and
several.
iii. WAIVERS. Debtor and any maker, endorser, guarantor,
surety or other party liable in any capacity respecting
the Obligations hereby waive demand, notice of intention
to accelerate, notice of acceleration, notice of
non-payment, presentment, protest, notice of dishonor
and any other similar notice whatsoever.
iv. SEVERABILITY. Any provision hereof found to be
invalid by courts having jurisdiction shall be invalid
only with respect to such provision (and then only to
the extent necessary to avoid such invalidity). The
offending provision shall be modified to the maximum
extent possible to confer upon Secured Party the
benefits intended thereby. Such provision as modified
and the remaining
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provisions hereof shall be construed and enforced to the
same effect as if such offending provision (or portion
thereof) had not been contained herein, to the maximum
extent possible.
v. USE OF COPIES. Any carbon, photographic or other
reproduction of any financing statement signed by Debtor
is sufficient as a financing statement for all purposes,
including without limitation, filing in any state as may
be permitted by the provisions of the Uniform Commercial
Code of such state.
vi. RELATIONSHIP TO OTHER AGREEMENTS. This Security
Agreement and the security interests (and pledges and
assignments as applicable) herein granted are in
addition to (and not in substitution, novation or
discharge of) any and all prior or contemporaneous
security agreements, security interests, pledges,
assignments, liens, rights, titles or other interests in
favor of Secured Party or assigned to Secured Party by
others in connection with the Obligations. All rights
and remedies of Secured Party in all such agreements are
cumulative, but in the event of actual conflict in terms
and conditions, the terms and conditions of the latest
security agreement shall govern and control.
vii. NOTICES. Any notice or demand given by Secured
Party to Debtor in connection with this Agreement, the
Collateral or the Obligations, shall be deemed given and
effective upon deposit in the United States mail,
postage prepaid, addressed to Debtor at the address of
Debtor designated at the beginning of this Agreement.
Actual notice to Debtor shall always be effective no
matter how given or received.
viii. HEADINGS AND GENDER. Paragraph headings in this
Agreement are for convenience only and shall be given no
meaning or significance in interpreting this Agreement.
All words used herein shall be construed to be of such
gender or number as the circumstances require.
ix. AMENDMENTS. Neither this Agreement nor any of its
provisions may be changed, amended, modified, waived or
discharged orally, but only by an instrument in writing
signed by the party against whom enforcement of the
change, amendment, modification, waiver or discharge is
sought.
x. CONTINUING AGREEMENT. The security interest (and
pledges and assignments as applicable) hereby granted
and all of the terms and provisions in this Agreement
shall be deemed a continuing
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agreement and shall continue in full force and effect
until terminated in writing. Any such revocation or
termination shall only be effective if explicitly
confirmed in a signed writing issued by Secured Party to
such effect and shall in no way impair or affect any
transactions entered into or rights created or
Obligations incurred or arising prior to such revocation
or termination as to which this Agreement shall be fully
operative until same are repaid and discharged in full.
Unless otherwise required by applicable law, Secured
Party shall be under no obligation to issue a
termination statement or similar documents unless Debtor
requests same in writing and, provided further, that all
Obligations have been repaid and discharged in full and
there are no commitments to make advances, incur any
Obligations or otherwise give value.
xi. BINDING EFFECT. The provisions of this Security
Agreement shall be binding upon the heirs, personal
representatives, successors and assigns of Debtor and
the rights, powers and remedies of Secured Party
hereunder shall inure to the benefit of the successors
and assigns of Secured Party.
xii. GOVERNING LAW. This Security Agreement shall be
governed by the law of the State of Texas and applicable
federal law.
xiii. AGREEMENT FOR BINDING ARBITRATION. DEBTOR AGREES TO
BE BOUND BY THE TERMS AND PROVISIONS OF THE ARBITRATION
PROGRAM (DATED 9/23/94) WHICH IS INCORPORATED BY
REFERENCE HEREIN AND IS ACKNOWLEDGED AS RECEIVED BY
DEBTOR PURSUANT TO WHICH ANY AND ALL DISPUTES SHALL BE
RESOLVED BY MANDATORY BINDING ARBITRATION UPON THE
REQUEST OF ANY PARTY.
EXECUTED as of this 1st day of March, 1996.
"Debtor"
BEARCOM, INC.
By:
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Name:
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Title:
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