Exhibit 10.35
-------------
THIRD AMENDMENT TO SECURITY AGREEMENT
-------------------------------------
This THIRD AMENDMENT TO SECURITY AGREEMENT ("Amendment"), dated as of
January 31, 1998 is between SCIENTIFIC MEASUREMENT SYSTEMS, INC., a Texas
corporation ("Debtor") and XXXXX FARGO HSBC TRADE BANK, N.A., a national banking
association ("Secured Party").
RECITALS:
--------
WHEREAS, Debtor and Secured Party have entered into that certain EXIM
Guaranteed Loan Agreement dated as of June 15, 1996, as amended by EXIM
Guaranteed Loan Agreement dated as of August 1, 1996, Second Amendment to EXIM
Guaranteed Loan Agreement dated as of June 15, 1997, Third Amendment to EXIM
Guaranteed Loan Agreement dated as of July 31, 1997, and Fourth Amendment to
EXIM Guaranteed Loan Agreement dated as of January 31, 1998 (the "Loan
Agreement").
WHEREAS, pursuant to the Loan Agreement Debtor executed that certain
Security Agreement, dated as of June 15, 1996, as amended by First Amendment to
Security Agreement dated as of June 15, 1997 and Second Amendment to Security
Agreement dated as of July 31, 1997 (the "Security Agreement").
WHEREAS, the execution of this Amendment is a condition to Secured Party
entering into the Fourth Amendment to EXIM Guaranteed Loan Agreement referred to
above.
NOW, THEREFORE, for good and valuable consideration the receipt and
sufficiency of which are acknowledged and agreed, Debtor and Secured Party
hereby agree as follows:
ARTICLE I.
---------
Amendments
----------
1. Amendment to Section 1.02(a). Effective as of the date hereof,
----------------------------
Section 1.02(a) of the Security Agreement is amended to read in its entirety as
follows:
(a) the obligations and indebtedness of Debtor to Secured Party evidenced by
that certain promissory note in the original principal amount of $579,223.94
dated January 31, 1998, executed by Debtor and payable to the order of Secured
Party, which was executed in renewal, extension and decrease of that certain
promissory note in the original principal amount of $629,223.94 dated
July 31, 1997, executed by Debtor and payable to the order of Secured Party,
which was executed in renewal, extension and decrease of that certain promissory
note in the original principal amount of $629,775.00 dated June 15, 1997,
executed by Debtor and payable to the order of Secured Party, which was executed
in renewal, extension and decrease of that certain promissory note in the
original principal amount of $1,250,000.00 dated June 15, 1996, executed by
Debtor and payable to the order of Secured Party.
ARTICLE II.
----------
Additional Provisions
---------------------
1. Acknowledgment by Debtor. Except as otherwise specified herein, the
------------------------
terms and provisions hereof shall in no manner impair, limit, restrict or
otherwise affect the obligations of Debtor or any third party to Secured Party
under any Loan Document (as defined in the Loan Agreement).
2. Additional Documentation. From time to time, Debtor shall execute or
------------------------
procure and deliver to Secured Party such other and further documents and
instruments evidencing, securing or pertaining to the Security Agreement or the
other Loan Documents as shall be reasonably requested by Secured Party so as to
evidence or effect the terms and provisions hereof.
3. Continued Effectiveness. Except as expressly modified by the terms
-----------------------
and provisions hereof, each of the terms and provisions of the Security
Agreement and the other Loan Documents are hereby ratified and confirmed, and
shall remain in full force and effect. The liens and security interests created
by the Security Agreement remain in full force and effect.
4. Governing Law. THE TERMS AND PROVISIONS HEREOF SHALL BE GOVERNED BY
-------------
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS.
5. Binding Agreement. This Amendment shall be binding upon the heirs,
-----------------
executors, administrators, personal representatives, successors and assigns of
the parties hereto.
6. Counterparts. This Amendment may be executed in any number of
------------
counterparts, each of which shall be deemed an original and all of which
together shall be construed as one and the same instrument.
7. No Oral Agreements. This Amendment, the Loan Agreement and the other
------------------
Loan Documents embody the final, entire agreement among the parties hereto.
There are no oral agreements among the parties hereto.
-2-
EXECUTED as of the date first above written.
DEBTOR:
------
SCIENTIFIC MEASUREMENT SYSTEMS, INC.
By:
--------------------------------
Xxxxxx Xxxxxx
Chief Executive Officer
SECURED PARTY:
-------------
XXXXX FARGO HSBC TRADE BANK, N.A.
By:
--------------------------------
Xxxxxx Xxx
Assistant Vice President
-3-
