Exhibit 10.49.5
SECURITY AGREEMENT
KNOW ALL MEN BY THESE PRESENTS:
In consideration of a loan extended by Xxxxxxx First National Bank
("Secured Party"), to TSI Redfield Laboratories, Inc. ("Debtor"), Debtor hereby
grants to Secured Party a security interest in the property described on Exhibit
"A" attached hereto ("Collateral"), and any proceeds of the future sale thereof.
The security interest herein granted is given for the purpose of providing
security for two (2) promissory notes ("Notes") in the original principal amount
of $700,000.00 and $350,000.00, respectively, bearing interest and becoming due
and payable as set forth therein, and any other indebtedness of whatsoever kind
or nature which is currently or may hereafter be due and owing from the Debtor
to the Secured Party.
In order to provide better security and protection for the Secured Party,
Debtor hereby warrants and covenants that:
1. LOCATION OF COLLATERAL. The Collateral will be kept and maintained at
its place of business, in Redfield, Arkansas, subject to the Debtor's right to
move and use the Collateral in the ordinary course of its business within the
State of Arkansas and that the Debtor will promptly notify Secured Party of any
permanent change in the location of the Collateral within the State of Arkansas
and will not permanently remove the Collateral from the State of Arkansas
without the written consent of the Secured Party.
2. PROHIBITION OF SALE OF COLLATERAL. The Debtor will not sell, offer for
sale, or transfer the Collateral or any interest therein, without the consent in
writing of the Secured Party.
3. INSURANCE. Debtor will have and maintain hazard insurance at all times
with respect to the insurable Collateral against all usual and ordinary risks,
including fire, theft, storm, collision and any other risks as the Secured Party
may require, pursuant to policies containing such terms, in such form, for such
periods, and by such companies as may be satisfactory to the Secured Party. The
proceeds of such insurance shall be payable to the Secured Party and the Debtor
as their respective interests may appear, and all policies of insurance shall
provide for a minimum of ten (10) days written notice to the Secured Party of
cancellation. Debtor shall furnish Secured Party with certificates or other
evidence satisfactory to Secured Party of compliance with the foregoing
insurance requirements and Secured Party is hereby authorized to act as
attorney-in-fact for and on behalf of Debtor in obtaining, adjusting, settling,
canceling, and releasing such insurance or any claims in connection therewith
and to endorse any check or draft in connection therewith for and on behalf of
the Debtor.
4. PROHIBITION OF ADVERSE LIENS. Except for liens in existence on the
date hereof, Debtor will keep the Collateral free from any additional adverse
lien, security
interest, or encumbrance and in good condition and repair, and will not cause
or permit waste or destruction of the Collateral or any part thereof. Debtor
will not use the Collateral in violation of any statute or ordinance.
Secured Party may examine and inspect the Collateral at any time and wherever
located.
5. TAXES. Debtor will promptly pay when due all taxes and licenses upon
the Collateral or for its use or operation. Provided, Secured Party may, at its
option, discharge any taxes, liens, security interests, or other encumbrances at
any time placed or levied on the Collateral, may pay for insurance thereon, and
may pay for the maintenance and preservation of the Collateral. Debtor agrees
to reimburse Secured Party on demand for any such payments made or expenses
incurred by Secured Party pursuant to this authorization and to pay the cost of
collection hereof, including a reasonable attorney's fee for Secured Party's
attorneys.
6. POSSESSION OF COLLATERAL. Until a default hereunder, Debtor may have
possession of the Collateral subject hereto and use same in any lawful manner
not inconsistent with this agreement and not inconsistent with any policy of
insurance thereon.
7. DEFAULT. Debtor shall be in default under this agreement and the Notes
which it secures, upon the happening of any of the following events or
conditions:
(a) Default in payment or performance of any obligation, covenant or
liability contained or referred to in the Loan Agreement, Mortgage, Notes
or herein.
(b) Any warranty, representation, or statement made to Secured Party by or
on behalf of Debtor proves to have been false in any material respect when
made.
(c) Any event which results in the acceleration of the maturity of the
indebtedness of Debtor to others under any note, agreement, or undertaking
in excess of $100,000.
(d) Loss, theft, damage, destruction, sale, or encumbrance to or of any of
the Collateral, except as herein specifically authorized, or the making or
occurrence of any levy, seizure, or attachment thereof or thereon.
(e) Death, dissolution, termination of existence, insolvency, business
failure, appointment of receiver for any part of the property of the
Debtor, assignment for the benefit of creditors by, or the commencement of
any proceedings under any bankruptcy or insolvency laws by or against
Debtor, or any guarantor or surety for the Debtor.
Upon the occurrence of any such event of default and at any time
thereafter, Secured Party may, in addition to acceleration of the
indebtedness hereby secured, proceed with any of the remedies of a secured
party as provided in the Uniform Commercial Code of the State of Arkansas.
Secured Party may require the Debtor to assemble the Collateral and make it
available to the Secured Party at a place designated by the Secured Party
which is reasonably convenient to both parties. If the Collateral is
perishable or threaten to decline speedily in
value or is of a type customarily sold on a recognized market, no notice of
such sale shall be given by the Secured Party to the Debtor. Otherwise,
Secured Party will give Debtor reasonable notice of the time and place of any
public sale or of the time after which any private sale or other intended
disposition is to be made. The requirements of a reasonable notice hereunder
shall be met if such notice is mailed by ordinary mail, postage prepaid,
addressed to the Debtor at its telephone book address or business address
first shown herein at least five (5) days before the time of such sale or
disposition. The expenses of taking, holding, preparing and selling the
Collateral shall include Secured Party's reasonable attorney's fees and legal
expenses.
8. WAIVER. No waiver by the Secured Party of any default shall operate as
a waiver of any other default or of the same default on a future occasion.
9. ASSIGNMENT. All rights of the Secured Party in, to and under this
agreement, the Notes and the Collateral shall pass to and may be exercised by
any assignee of one or both of the Notes and this agreement. Debtor agrees
that, in the event of an assignment of the Notes and this agreement and upon
receipt by the Debtor of notice of such assignment, the liability of the Debtor
to a holder for value of either or both of the Notes shall be immediate and
absolute and not affected by any default of the Secured Party. Debtor further
warrants that it will not set up any claim against the assigned party as a
defense, counterclaim, or set-off to any action for the unpaid balance owed
under the Notes or for possession brought by any such holder. All obligations
of the Debtor shall bind its successors or assigns.
IN WITNESS WHEREOF, the Debtor has executed this Security Agreement on this
22nd day of May, 1997.
TSI REDFIELD LABORATORIES, INC.
By /s/ Xxxx X. Xxxxx, Treasurer
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Xxxx X. Xxxxx, Treasurer
