SECURITY AGREEMENT
1. GRANT. For value received, Datametrics, Inc., a Delaware
corporation, ("DMC"), in this security agreement (this "Security Agreement"),
grants to Xxxxxx X. Xxxxx ("Secured Party"), a security interest in all right,
title, and interest of DMC now or hereafter acquired, in or to the property more
particularly described in the schedule of collateral attached to this Security
Agreement.
2. ATTACHMENT AND OBLIGATION SECURED. The security interest created by
this Security Agreement will attach immediately upon execution of this Security
Agreement by DMC, and will secure all of DMC's obligations to make any payments
to Secured Party under the Severance Package as agreed by DMC in Section 6.1 of
the Amended Employment Agreement entered into between DMC and Secured Party on
August 12, 1997. Said security interest is issued concurrently with an identical
security interest issued to Xxxxxx X. Xxxxxx, Xx., both such security interests
ranking pari passu to each other. Except for said security interests granted by
DMC pursuant to the agreements described on Exhibit E of the foregoing Amended
Employment Agreement in favor of (1) Imperial Bank and (2) the holders of
certain Senior Subordinated Secured Debentures, DMC has not granted any
perfected security interests that now exists and are continuing. (Imperial Bank
and the holders of the Senior Subordinated Secured Debentures of DMC are
collectively referred to herein as the "Senior Secured Lenders.")
3. SECURITY INTEREST IN PROCEEDS. The Collateral also includes any and
all proceeds of the Collateral or any part of the Collateral, as defined in
Section 9306 of the Uniform Commercial Code of California or in the
corresponding provisions of the Uniform Commercial Code of any other state.
4. SUBORDINATION. The rights of Secured Party under the terms of this
Security Agreement shall be subordinated to any right or interest of the Senior
Secured Lenders in any of the Collateral securing the payment of: (a) the
principal and accrued and unpaid interest (whether accruing on or after the
filing of any petition in bankruptcy or for reorganization relating to DMC) on
any obligation to the Senior Secured Lenders, whether outstanding on the date of
execution of this Security Agreement or thereafter created, incurred, or
assumed, and any guaranty, endorsement, or other contingent obligation in
respect thereof; and (b) any modification, renewal, extension or refunding of
any such indebtedness, liabilities or obligations.
5. DEFAULT. Should DMC fail to perform any provision of this Security
Agreement or should DMC fail to pay any obligation secured by this Security
Agreement as it becomes due, DMC shall be deemed to be in default of this
Security Agreement under Division 9 of the Uniform Commercial Code of California
and under the corresponding provisions of the Uniform Commercial Code of any
other state. In such event, Secured Party will have all the rights and remedies
afforded to a secured party under Division 9 of the Uniform Commercial Code of
California and under the corresponding provisions of the Uniform Commercial Code
of any other state on the date of this Security Agreement and may, in connection
therewith and subject to the rights of the Senior Secured Lenders, also, but
without limitation:
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a. Enter the premises to assemble and take possession of the Collateral;
and
b. Enter the premises, render the Collateral, if equipment, usable and
dispose of it in the manner provided by the Uniform Commercial Code of
California or by the Uniform Commercial Code of any other state.
6. Financing Statement. Concurrent with the execution of this Security
Agreement, the parties hereto, DMC and Secured Party, shall execute any
financing statement or statements required to perfect the security interest
created by this Security Agreement.
7. WAIVER. Neither the acceptance of any partial benefits and/or
partial payments provided under the Severance Package by Secured party, nor
Secured Party's failure to exercise any of his rights or remedies on default by
DMC, shall be a waiver of the default, a modification of this Security Agreement
or of DMC's obligations under this Security Agreement, or a waiver of any
subsequent default by DMC.
8. NOTICES. Except as expressly provided for in this Security Agreement
or by law, any and all notices or other communications required or permitted by
this Security Agreement or by law to be served on, given to, or delivered to
either party hereto, shall be in writing and shall be deemed duly served, given,
delivered, and received when personally delivered to the party to whom it is
directed, or in lieu of such personal delivery, when deposited in the United
States mail, first class postage prepaid, addressed to Secured Party or to DMC
at their respective addresses set forth on the Schedule of Collateral attached
hereto. Either party may change its address for the purposes of this paragraph
by giving written notice of such change to the other party in the manner
provided in this paragraph.
9. ATTORNEY'S FEES. If any action at law or in equity is brought to
enforce or interpret the provisions of this Agreement or any other agreement or
instrument provided for herein, the prevailing party in such action shall be
entitled to recover as an element of such party's costs of suit, and not as
damages actual attorneys' fees to be fixed by the court. The prevailing party
shall be the party who is entitled to recover its costs of suit as ordered by
the court or by applicable law or court rules. A party not entitled to recover
its costs shall not recover attorneys' fees.
10. SUCCESSORS AND ASSIGNS. This Security Agreement shall be binding
upon and shall inure to the benefit of the parties hereto, their successors and
assigns, but shall not be assigned, transferred or set over in whole or in part
by any party without the prior written consent of each party.
11. GOVERNING LAW. This Security Agreement will be governed by and
construed in accordance with the laws of the State of California, except to the
extent that the validity and perfection of the security interest hereunder, or
remedies hereunder, in respect of any particular Collateral, are governed by the
laws of a jurisdiction other than the State of California.
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12. SEVERABILITY. Any provision of this Security Agreement which is
held to be invalid or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity or uneforceability
without invalidating the remaining provisions hereof or affecting the validity
or enforceability of such provision in any other jurisdiction.
13. COUNTERPARTS. This Security Agreement may be executed in several
counterparts and also so executed will constitute one Security Agreement,
binding on all the Parties.
14. SOLE AND ONLY AGREEMENT. This instrument constitutes the sole and
only agreement between the parties with respect to the Collateral or the
security interest in the Collateral created by this Security Agreement. This
instrument correctly sets forth the rights, duties, and obligations of each
party with respect to the Collateral and the security interest hereby created in
the Collateral as of this date. Any prior agreements, promises, negotiations, or
representations concerning the subject matter of this Security Agreement not
expressly set forth herein are no longer of any force and effect.
Effected on August 12, 1997, at 10:55 AM (EST)
DATAMETRICS, INC. XXXXXX X. XXXXX
By /s/ Xxxxxxx X. Xxxx /s/ Xxxxxx X. Xxxxx
----------------------- ---------------------------
Name Xxxxxxx X. Xxxx
Title: Director and Chair of Compensation
Committee and Chair of Audit Committee
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SCHEDULE OF COLLATERAL
DMC: Datametrics, Inc.
00000 Xxxxx Xxxxxx
Xxxxxxxx Xxxxx, Xxxxxxxxxx 00000
SECURED PARTY: Xxxxxx X. Xxxxx
00 Xxxxxxx Xxxx
Xxxxxxx, Xxx Xxxxxx 00000
All right, title, and interest of DMC, how or hereafter acquired, to the
following described property:
All personal property, whether presently existing or
hereafter created or acquired, including but not
limited to: All accounts, chattel paper, documents,
instruments, money, deposit accounts and general
intangibles including returns, repossessions, books
and records relating thereto, and equipment
containing said books and records. All goods
including equipment and inventory. All proceeds
including without limitation, insurance proceeds. All
guarantees and other security therefor.
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EXHIBIT E
1. The Security and Loan Agreements entered into between Datametrics Corporation
and Imperial Bank ("Bank") on March 4, 1997 securing loans made by Bank.
2. The Security Agreement entered into between Datametrics Corporation and
twelve Secured Parties on November 25, 1996 securing Senior Subordinated Secured
Debentures.
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