ASSIGNMENT AND MODIFICATION
OF PROMISSORY NOTES
Dated Effective as of
Principal Amount: $800,000.00 _______________, 2006
Maturity Date: July 1, 2010
Interest Rate: 6.50% per anum
This Modification and Assignment of Promissory Notes (the "Revised Note")
is made by and between Xxxxxx Xxxxxx Xxxxx Testamentary Trust II (the
"Holder"), 12K, LLC, a Florida limited liability company (the "Assignee"), and
Firestone Communications Inc., and Delaware corporation (the "Borrower").
RECITALS
Xxxxxxxx executed two Promissory Notes payable to Holder dated August 1,
2003 and October 7, 2003, respectively, each having a principle amount of Five
Hundred Thousand DollarS and No/100 Dollars ($500,000.00), and such additional
sums advanced from time to time to Borrower (collectively the "Original Notes").
Holder desires to assign all rights and obligations under the Original Notes to
Assignee, Borrower and Assignee desire to modify and extend the Original
Notes according to the terms and conditions set forth herein.
This modification and extension of the maturity date of the Original Notes
shall have no effect on the Borrower's obligations under that certain Secured
Promissory Note dated January 20, 2005, in the original principal amount of
$800,000 payable to Assignee, and the Security Agreement dated January 20, 2005
securing that Secured Promissory Note.
NOW THEREFORE, in consideration of the mutual covenants contained herein,
all parties hereto agree as follows:
1. Assignment. Holder hereby assigns to the Assigned all its rights, title
and interest in the Original Notes, and all parties hereto agree that the terms
set out in the Original Notes shall be superseded and replaced by the terms of
this Revised Note.
2. Payments. Borrower unconditionally promises to pay to the order of
Assignee the Principal Xxxxxx stated above, in equal monthly installments of
$15,655 (which amount includes principal of $12,600 plus interest at the
interest rate of 6.50% per annum), such monthly payments commencing on July 1,
2005, and continuing through July 1, 2010.
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3. Maturity Date. The maturity date of this Revised Notes shall be July 1,
2010, at which time the entire remaining unpaid principal amount plus accrued
Interest shall be due and payable in full.
4. Use of Proceeds. Borrower shall use the proceeds of the loan evidenced
by this Revised Note for the commercial purposes of the Borrower.
5. Default Rate. In the event of a Default (as defined below), interest
shall accrue on past due principal hereof and, to the extent permitted by
applicable law, on overdue interest thereon, at a rate (the "Default Rate")
equal to the maximum rate permitted by applicable law, from the date that
payment of such principal or interest is due until the date of payment thereof.
Accrued Interest on overdue amounts hereunder shall be payable upon payment of
such overdue amounts.
6. Late Charges. Borrower shall pay a late charge on any payment which is
not paid within five (5) days after the date due of five percent (5%) of said
amount.
7. Limitation on Interest Rate. Notwithstanding anything to the contrary
contained in this Revised Note, if the interest rate specified herein shall
exceed the maximum rate permitted by applicable law as in effect from time to
time, Borrower shall pay interest at the highest permissible rats, which rate
shall change as and when such highest permissible rate shall change. If Borrower
makes an interest payment hereunder that exceeds the maximum amount of interest
permitted by applicable law, the excess of such payment above the maximum amount
that lawfully may be paid automatically shall be credited toward the payment of
principal so as to reduce the amount of the final payment of principal due
hereunder or, if Xxxxxxxx makes an interest payment that exceeds the maximum
amount of interest permitted by applicable law and all principal hereunder shall
have been previously or thereby paid in full, such payment shall be deemed to
have been the result of mathematical error and Assignee shall refund to Borrower
the amount of such payment that is in excess of the amount that lawfully may
be paid.
8. Place of Payment. Payments of both principal and interest hereunder are
to be made in immediately available funds sent not later than 1:00 p.m.,
Jacksonville, Florida time, on the date due, to Assignee at its principal office
(or in such other manner or at such other address as may be designated by
Assignee in writing), without the necessity of any presentment of this Revised
Note by it or any notation thereon.
9. Security. Xxxxxxxx has granted to Xxxxxx a security interest in the
collateral described in that certain Security Agreement dated January 24, 2003
(the "Security Agreement"). The Holder has assigned to Assignee the Holder's
rights, title and interest under the Security Agreement as of the date of this
Revised Note. This Revised Note secured by and entitled to the benefits under
the Security Agreement.
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10. Assignment of Revised Note. Assignee shall have the right, which may be
exercised at any time, whether or not this Revised Note is due, to pledge or
transfer this Revised Note and collateral therefor and, if this Revised Note is
due, to demand, sue for, collect or make any compromise or settlement it deems
desirable with reference to the collateral.
11. Prepayment. This Revised Note may be prepaid, in whole or in part,
without premium or penalty.
12. Default. An Event of Default shall occur if: (a) Borrower fails to make
any payment of principal or interest hereunder or any other amount owing
hereunder or under this Revised Note on or before the tenth (10th) day following
the due date; (b) an event of default beyond any applicable notice, grace and/or
cure period occurs under any other obligation owed by Borrower to Assignee; or
(c) Borrower or any guarantor or endorser of this Revised Note; (i) files a
voluntary petition in bankruptcy, or (ii) is adjudicated as a bankrupt or
insolvent; or (iii) files any petition or answer seeking or acquiescing in any
reorganization, management, composition, readjustment, liquidation, dissolution
or similar relief for itself under any law relating to bankruptcy, insolvency or
other relief for debtors; or (iv) seeks, consents to or acquiesces in the
appointment of any trustee, receiver master or liquidator of itself or of all or
any part of the property securing the Revised Note; or (v) makes any general
assignment for the benefit of creditors; or (vi) makes any admission in writing
of its inability to pay its debts generally as they become due; or (vii) a court
of competent jurisdiction enters an order, judgment or decree approving a
petition filed against it seeking any reorganization, arrangement, composition,
readjustment, liquidation, dissolution or similar relief under any present or
future federal, state or other statute, law or regulation relating to
bankruptcy, insolvency or other relief for debtors, which order, judgment or
decree remains unvacated and unstayed for an aggregate of sixty (60) days
whether or not consecutive from the date of entry thereof, or (viii) any
trustee, receiver or liquidator of it or of any part of the property securing
this Revised Note is appointed without the prior written consent of Assignee,
which appointment shall remain unvacated and unstayed for an aggregate of sixty
(60) days, whether or not consecutive, or (ix) a final judgment in excess of
$150,000.00 shall be rendered against Borrower and if, within thirty (30) days
after entry thereof, such judgment shall not have been discharged or execution
thereof stayed pending appeal, or if within thirty (30) days after the
expiration of any such stay, such judgment shall not have been discharged.
13. Remedies Upon Default. Upon the occurrence of an Event of Default,
Assignee, upon notice to Xxxxxxxx, may declare the entire principal amount of
this Revised Note then outstanding, together with interest accrued and unpaid
thereon, and prepayment fee thereon, to be immediately due and payable without
presentment, demand, protest, notice of protest or dishonor, all of which are
expressly waived by Borrower. Assignee also shall have the right, in addition to
all other rights under this Revised Note or applicable law, to set off against
this Revised Note all money owned by Assignee in any capacity to Borrower,
whether or not due. Assignee
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shall be deemed to have exercised such right of setoff and to have made a charge
against any such money immediately upon the occurrence of an Event of Default
even though such charge is made or entered in the books of Assignee subsequent
thereto.
14. Xxxxxxxx's Attorney's Fees & Collection. Should the indebtedness
evidenced by this Revised Note or any portion thereof be collected by action at
law, or in bankruptcy, receivership or other court proceedings, or should this
Revised Note be placed in the hands of attorneys for collection after default
Borrower shall pay, upon demand by Assignee, in addition to principal and
interest due and payable hereof, court costs, reasonable attorneys' fees and
other collection charges and expenses whether or not incurred by trials, appeals
or bankruptcy actions, unless prohibited by law. The Default Rate shall govern
the rate of post-judgment interest.
15. Waiver of Jury Trail. NO PARTY TO THIS REVISED NOTE OR ANY ASSIGNEE,
SUCCESSOR, HEIR OR LEGAL REPRESENTATIVE OF A PARTY SHALL SEEK A JURY TRIAL IN
ANY LAWSUIT, PROCEEDING, COUNTERCLAIM OR OTHER PROCEEDING BASED UPON OR ARISING
OUT OF THIS REVISED NOTE, ANY OF THE LOAN DOCUMENTS, ANY RELATED AGREEMENT OR
INSTRUMENT, ANY COLLATERAL FOR THIS REVISED NOTE OR THE DEALINGS OR THE
RELATIONSHIP BETWEEN OR AMONG THE PARTIES, OR ANY OF THEM. NO SUCH PARTY SHALL
SEEK TO CONSOLIDATE ANY SUCH ACTION, IN WHICH A JURY TRIAL HAS BEEN WAIVED, WITH
ANY OTHER ACTION IN WHICH A JURY TRIAL CANNOT BE OR HAS NOT BEEN WAIVED. THE
PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY NEGOTIATED BY THE PARTIES HERETO,
AND THESE PROVISIONS SHALL BE SUBJECT TO NO EXCEPTIONS. NO PARTY HAS IN ANY WAY
AGREED WITH OR REPRESENTED TO ANY OTHER PARTY THAT THE PROVISIONS OF THIS
PARAGRAPH WILL NOT BE FULLY ENFORCED IN ALL INSTANCES. THIS PROVISION IS A
MATERIAL INDUCEMENT FOR ASSIGNEE TO MAKE THE LOAN EVIDENCED BY THIS NOTE.
16. Waivers. The Borrower, and any endorsers or guarantors hereof,
severally waive diligence, presentment, protest and demand and also notice of
protest, demand, dishonor, acceleration, intent to accelerate, and nonpayment of
this Revised Note, and expressly agree that this Revised Note, or any payment
hereunder, may be extended from time to time without notice, and consent to the
acceptance or further security or the release of any security for this Revised
Note, all without in any way affecting the liability of the undersigned and any
endorsers or guarantors hereof. No extension of time for the payment of this
Revised Note, or any installment hereof, made by agreement by the holder hereof
with any person now or hereafter liable for the payment of this Revision Note,
shall affect the original liability under this Revised Note of the undersigned,
even if the undersigned is not a party to such agreement.
No delay or omission of a holder of this Revised Note in exercising any
right or remedy hereunder shall constitute a waiver of any such right or remedy.
Acceptance by a holder of any payment after acceleration shall not be deemed a
waiver of such
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acceleration. A waiver on one occasion shall not operate as a bar to or waiver
of any such right or remedy on any future occasion. This Revised Note may not be
amended or modified except in writing signed by an officer of Assignee.
17. Taxes and Fees. Borrower shall promptly pay all documentary, intangible
recordation and / or similar taxes on this transaction whether assessed at
closing or arising from time to time.
18. Governing Law. This Revised Note shall be governed by and interpreted
in accordance with the laws of the State of Florida.
"HOLDER"
Xxxxxx Xxxxxx Xxxxx Testamentary
Trust II
By: /s/ Xxxxxxx X. Xxxxx
-----------------------------------
Xxxxxxx X. Xxxxx, Xx., Trustee
"BORROWER"
Firestone Communications, Inc, a
Delaware Corporation
By: /s/ Xxxxxxx X. Xxxxxxxxx
-----------------------------------
Xxxxxxx X. Xxxxxxxxx, Chief
Executive Officer
"ASSIGNEE"
12K, LLC, a Florida limited liability
company
By: /s/ Xxxxxxx X. Xxxxx
-----------------------------------
Xxxxxxx X. Xxxxx, Xx., Manager
[THIS NOTE MODIFICATION IS BEING
EXECUTED OUTSIDE OF THE STATE OF
FLORIDA AND IS THEREFORE NOT SUBJECT
TO THE FLORIDA DOCUMENTARY STAMP TAX]
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PROMISSORY NOTE
$500,000 August 1, 2003
FIRESTONE COMMUNICATIONS, INC.
0000 Xxxxxxx Xxxxxxx, Xxxxx 000
Xxxx Xxxxx, Xxxxx 00000
Attention: Xxxxxxx X. Xxxxxxxxx
(Hereinafter referred to as "Borrower")
XXXXXX XXXXXX XXXXX TESTAMENTARY TRUST II
0000 Xxxxxxxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx, Xx.
(Hereinafter referred to as "Lender")
Xxxxxxxx promises to pay to the order of Lender, in lawful money of the United
States of America, at its office indicated above or wherever else Lender may
specify, the sum of Five Hundred Thousand and No/100 Dollars ($500,000) or such
additional sum as may be advanced and outstanding from time to time, with
interest on the unpaid principal balance at the rate and on the terms provided
in this Promissory Note (including all renewals, extensions or modifications
hereof, this "Note").
USE OF PROCEEDS. Borrower shall use the proceeds of the loan(s) evidenced by
this Note for the commercial purposes of Borrower, as follows: for working
capital purposes and capital expenditures.
SECURITY. Xxxxxxxx has granted Xxxxxx a security interest in the collateral
described in the Loan Documents, including, but not limited to, personal
property collateral described in that certain Security Agreement dated January
24, 2003.
INTEREST RATE. Interest shall accrue on the unpaid principal balance of this
Note from the date hereof at the rate of 6% per annum ("Interest Rate").
DEFAULT RATE. In addition to all other rights contained in this Note, if a
Default (as defined herein) occurs and as long as a Default continues, all
outstanding Obligations shall bear interest at the Interest Rate plus 10%
("Default Rate"). The Default Rate shall also apply from demand until the
Obligations or any judgment thereon is paid in full.
INTEREST AND FEES(S) COMPUTATION (ACTUAL/360). Interest and fees, if any, shall
be computed on the basis of a 360-day year for the actual number of days in the
applicable period ("Actual/360 Computation"). The Actual/360 Computation
determines the annual effective yield by taking the stated (nominal) rate for a
year's period and then dividing said rate by 360 to determine the daily periodic
rate to be applied for each day in the applicable period. Application of the
Actual/360 Computation produces an annualized effective rate exceeding the
nominal rate.
PREPAYMENT. Principal may be prepaid in whole or in part at any time. Any
prepayment in whole or in part shall include accrued interest and all other sums
then due under any of and shall be applied first to such interest and other sums
and then to principal. No partial prepayment shall affect the obligation of
Borrower to make any payment of principal or interest due under this Note on the
due dates specified.
REPAYMENT TERMS. The principal and accrued interest due under this Note shall be
paid in the following manner: (a) Beginning November 1, 2003 and continuing on
the first (1st) day of each month thereafter until and including the first (1st)
day of January, 2004, Borrower shall pay Lender consecutive monthly payments in
arrears of accrued interest on the amount of the unpaid principal balance of
this
Note; (c) Beginning January 1, 2004, Borrower shall pay Lender the unpaid
principal balance of this Note in consecutive monthly payments of $27,778, plus
accrued interest, commencing January 1, 2004, and continuing on the first (1st)
day of each month thereafter until fully paid; and (d) In any event, all
principal and accrued interest shall be due and payable on June 1, 2005.
APPLICATION OF PAYMENTS. Monies received by Xxxxxx from any source for
application toward payment of the Obligations shall be applied to accrued
interest, fees and expenses payable to Lender hereunder and then to principal.
If a Default occurs, monies may be applied to the Obligations in any manner or
order deemed appropriate by Lender. If any payment received by Lender under this
Note or other Loan Documents is rescinded, avoided or for any reason returned by
Lender because of any adverse claim or threatened action, the returned payment
shall remain payable as an obligation of all persons liable under this Note or
other Loan Documents as though such payment had not been made.
DEFINITIONS. LOAN DOCUMENTS. The term "Loan Documents" refers to all documents,
including this Note, whether now or hereafter existing, executed in connection
with or related to the Obligations, and may include, without limitation and
whether executed by Borrower or others, commitment letters that survive closing,
loan agreements, promissory notes, guaranty agreements, other security
agreements, letters of credit and applications for letters of credit, security
instruments, financing statements, mortgage instruments, any renewals or
modifications, whenever any of the foregoing are executed. OBLIGATIONS. The term
"Obligations", as used in this Note and the other Loan Documents, refers to any
and all obligations of Borrower to Lender however created, whether direct or
indirect, absolute or contingent, now existing or hereafter arising or acquired,
and whether or not evidenced by a Loan Document, including, future advances, and
all costs and expenses incurred by Xxxxxx to obtain, preserve, perfect and
enforce the security interest granted herein and to maintain, preserve and
collect the property subject to the security interest. CERTAIN OTHER TERMS. All
terms that are used but not otherwise defined in any of the Loan Documents shall
have the definitions provided in the Uniform Commercial Code.
LATE CHARGE. If any payments are not timely made, Borrower shall also pay to
Lender a late charge equal to 5% of each payment past due for 10 or more days.
Acceptance by Xxxxxx of any late payment without an accompanying late charge
shall not be deemed a waiver of Xxxxxx's right to collect such late charge or to
collect a late charge for any subsequent late payment received.
ATTORNEYS' FEES AND OTHER COLLECTION COSTS. Borrower shall pay all of Xxxxxx's
reasonable expenses incurred to enforce or collect any of the Obligations
including, without limitation, reasonable arbitration, paralegals', attorneys'
and experts' fees and expenses, whether incurred without the commencement of a
suit, in any trial, arbitration, or administrative proceeding, or in any
appellate or bankruptcy proceeding.
USURY. If at any time the effective interest rate under this Note would, but for
this paragraph, exceed the maximum lawful rate, the effective interest rate
under this Note shall be the maximum lawful rate, and any amount received by
Lender in excess of such rate shall be applied to principal and then to fees and
expenses, or, if no such amounts are owing, returned to Borrower.
CONDITIONS. The obligation of Lender hereunder, is subject to the satisfaction
of the conditions set forth in Exhibit 1 attached hereto.
DEFAULT. If any of the following occurs and is not cured in 30 days, a default
("Default") under this Note shall exist; NONPAYMENT; NONPERFORMANCE. The failure
of timely payment or performance of the Obligations or Default under this Note
or any other Loan Documents. COVENANTS. The failure to perform or observe, or a
breach of, any covenant or agreement in this Note or any Loan Document. FALSE
WARRANTY. A warranty or representation made or deemed made in the Loan Documents
or furnished Lender in connection with the loan evidenced by this Note proves
materially false, or if of a continuing nature, becomes materially false. CROSS
DEFAULT. At Lender's option, any default in payment or performance of any
obligation under any other loans, contracts or agreements of Borrower, any
Subsidiary or Affiliate of Borrower, any general partner of or the holder(s) of
the majority ownership interests of Borrower with Lender or its affiliates
("Affiliate" shall have the meaning as defined in 11 U.S.C.
Page 2
Section 101, except that the term "Borrower" shall be substituted for the term
"Debtor" therein; "Subsidiary" shall mean any business in which Borrower holds,
directly or indirectly, a controlling interest). CESSATION; BANKRUPTCY. The
death of, appointment of a guardian for, dissolution of, termination of
existence of, loss of good standing status by, appointment of a receiver for,
assignment for the benefit of creditors of, or commencement of any bankruptcy
or insolvency proceeding by or against Borrower, its Subsidiaries or Affiliates,
if any, or any general partner of or the holder(s) of the majority ownership
interests of Borrower, or any party to the Loan Documents. MATERIAL BUSINESS
ALTERATION. Without prior written consent of Lender, a material alteration in
the kind or type of Borrower's business. MATERIAL CAPITAL STRUCTURE OR BUSINESS
ALTERATION. Without prior written consent of Lender, (i) a material alteration
in the kind or type of Borrower's business or that of Borrower's Subsidiaries or
Affiliates, if any; (ii) the sale of substantially all of the business or assets
of Borrower, any of Borrower's Subsidiaries or Affiliates or any guarantor, or a
material portion (10% or more) of such business or assets if such a sale is
outside the ordinary course of business of Borrower, or any of Borrower's
Subsidiaries or Affiliates or any guarantor, or more than 50% of the outstanding
stock or voting power of or in any such entity in a single transaction or a
series of transactions; (iii) the acquisition of substantially all of the
business or assets or more than 50% of the outstanding stock or voting power of
any other entity; or (iv) should any Borrower or any of Borrower's Subsidiaries
or Affiliates or any guarantor enter into any merger or consolidation. MATERIAL
ADVERSE CHANGE. Lender determines in good faith, in its sole discretion, that
the prospects for payment or performance of the Obligations are impaired or
there has occurred a material adverse change in the business or prospects of
Borrower, financial or otherwise. CONDITIONS. The failure to satisfy any of the
conditions set forth above.
REMEDIES UPON DEFAULT. If a Default occurs and remains uncured for 30 days
under this Note or any Loan Documents, Lender may at any time thereafter, take
the following actions: ACCELERATION UPON DEFAULT. Accelerate the maturity of
this Note and, at Lender's option, any or all other Obligations between Borrower
and Lender; whereupon this Note and the accelerated Obligations shall be
immediately due and payable; provided, however, if the Default is based upon a
bankruptcy or insolvency proceeding commenced by or against Borrower or any
guarantor or endorser of this Note, all Obligations shall automatically and
immediately be due and payable. CUMULATIVE. Exercise any rights and remedies as
provided under the Note and other Loan Documents, or as provided by law or
equity.
FINANCIAL AND OTHER INFORMATION. Borrower shall deliver to Lender such
information as Lender may reasonably request from time to time, including
without limitation, financial statements and information pertaining to
Xxxxxxxx's financial condition. Such information shall be true, complete, and
accurate.
WAIVERS AND AMENDMENTS. No waivers, amendments or modifications of this Note and
other Loan Documents shall be valid unless in writing and signed by an officer
of Lender. No waiver by Lender of any Default shall operate as a waiver of any
other Default or the same Default on a future occasion. Neither the failure nor
any delay on the part of Lender in exercising any right, power, or remedy under
this Note and other Loan Documents shall operate as a waiver thereof, nor shall
a single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any other right, power or remedy.
Each Borrower or any person liable under this Note waives presentment, protest,
notice of dishonor, demand for payment, notice of intention to accelerate
maturity, notice of acceleration of maturity, notice of sale and all other
notices of any kind. Further, each agrees that Lender may extend, modify or
renew this Note or make a novation of the loan evidenced by this Note for any
period, and grant any releases, compromises or indulgences with respect to any
collateral securing this Note, or with respect to any other Borrower or any
other person liable under this Note or other Loan Documents, all without notice
to or consent of each Borrower or each person who may be liable under this Note
or any other Loan Document and without affecting the liability of Borrower or
any person who may be liable under this Note or any other Loan Document.
MISCELLANEOUS PROVISIONS. ASSIGNMENT. This Note and the other Loan Documents
shall inure to the benefit of and be binding upon the parties and their
respective heirs, legal representatives, successors and assigns. Xxxxxx's
interests in and rights under this Note and the other Loan Documents
Page 3
are freely assignable, in whole or in part, by Xxxxxx. Borrower shall not assign
its rights and interest hereunder without the prior written consent of Xxxxxx,
and any attempt by Borrower to assign without Xxxxxx's prior written consent is
null and void. Any assignment shall not release Borrower from the Obligations
unless Lender consents to such release. APPLICABLE LAW; CONFLICT BETWEEN
DOCUMENTS. This Note and, unless otherwise provided in any other Loan Document,
the other Loan Documents shall be governed by and construed under the laws of
the state named in Xxxxxx's address on the first page hereof without regard to
that state's conflict of laws principles. If the terms of this Note should
conflict with the terms of any loan agreement or any commitment letter that
survives closing, the terms of this Note shall control unless otherwise
specified in such loan document. JURISDICTION. Borrower irrevocably agrees to
non-exclusive personal jurisdiction in the state named in Xxxxxx's address on
the first page hereof. SEVERABILITY. If any provision of this Note or of the
other Loan Documents shall be prohibited or invalid under applicable law, such
provision shall be ineffective but only to the extent of such prohibition or
invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Note or other such document. NOTICES. Any notices
to Borrower shall be sufficiently given, if in writing and mailed or delivered
to the Borrower's address shown above or such other address as provided
hereunder, and to Lender, if in writing and mailed or delivered to the address
of Lender shown above, or such other address as Lender may specify in writing
from time to time. In the event that Xxxxxxxx changes Xxxxxxxx's address at any
time prior to the date the Obligations are paid in full, Xxxxxxxx agrees to
promptly give written notice of said change of address by registered or
certified mail, return receipt requested, all charges prepaid. PLURAL; CAPTIONS.
All references in the Loan Documents to Borrower, guarantor, person, document or
other nouns of reference mean both the singular and plural form, as the case may
be, and the term "person" shall mean any individual, person or entity. The
captions contained in the Loan Documents are inserted for convenience only and
shall not affect the meaning or interpretation of the Loan Documents. ADVANCES.
Lender may, in its sole discretion, make other advances that shall be deemed to
be advances under this Note, even though the stated principal amount of this
Note may be exceeded as a result thereof. JOINT AND SEVERAL OBLIGATIONS. Each
person who signs this Note as a Borrower (as defined herein) is jointly and
severally obligated. FEES AND TAXES. Borrower shall promptly pay all
documentary, intangible recordation and/or similar taxes on this transaction
whether assessed at closing or arising from time to time.
WAIVER OF JURY TRIAL. TO THE EXTENT PERMITTED BY APPLICABLE LAW, BORROWER BY
EXECUTION HEREOF AND XXXXXX BY ACCEPTANCE HEREOF, KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE ANY RIGHT THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY
LITIGATION BASED ON, OR ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS NOTE,
THE LOAN DOCUMENTS OR ANY AGREEMENT CONTEMPLATED TO BE EXECUTED IN CONNECTION
WITH THIS NOTE, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER
VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY WITH RESPECT HERETO. THIS PROVISION
IS A MATERIAL INDUCEMENT TO LENDER TO ACCEPT THIS NOTE.
XXXXXXXX AND XXXXXX AGREE THAT THEY SHALL NOT HAVE A REMEDY OF PUNITIVE OR
EXEMPLARY DAMAGES AGAINST THE OTHER IN ANY DISPUTE AND HEREBY WAIVE ANY RIGHT OR
CLAIM TO PUNITIVE OR EXEMPLARY DAMAGES THEY HAVE NOW OR WHICH MAY ARISE IN THE
FUTURE IN CONNECTION WITH ANY DISPUTE WHETHER THE DISPUTE IS RESOLVED BY
ARBITRATION OR JUDICIALLY.
Page 4
IN WITNESS WHEREOF, Xxxxxxxx, on the day and year first above written, has
caused this Note to be executed under seal.
FIRESTONE COMMUNICATIONS, INC.
Taxpayer Identification Number: _______
By:
-----------------------------------
Xxxxxxx X. Xxxxxxxxx, Chairman
and CEO
Page 5
EXHIBIT I
CONDITIONS
1. The loan will be administered by a designated representative of Lender.
This will include but not be limited to a monthly review of Xxxxxxxx's
Balance Sheet and Profit and Loss statements to be delivered within 21 days
from the end of the previous calendar month.
2. Copies of Tax returns within 30 days of filing.
Page 6
SECURITY AGREEMENT
JANUARY 24, 2003
FIRESTONE COMMUNICATIONS, INC.
0000 Xxxxxxx Xxxxxxx, Xxxxx 000
Xxxx Xxxxx, Xxxxx 00000
Attention: Xxxxxxx X. Xxxxxxxxx
(Hereinafter referred to as "Borrower)
XXXXXX XXXXXX XXXXX TESTAMENTARY TRUST II
0000 Xxxxxxxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx, Xx.
(Hereinafter referred to as "Lender")
For value received and to secure payment and performance of any and all
obligations of Borrower to Lender however created, arising or evidenced, whether
direct or indirect, absolute or contingent, now existing or hereafter arising or
acquired, and whether or not evidenced by a Loan Document, including, future
advances, and all costs and expenses incurred by Xxxxxx to obtain, preserve,
perfect and enforce the security interest granted herein and to maintain,
preserve and collect the property subject to the security interest
(collectively, "Obligations"), Borrower hereby grants to Lender a continuing
security interest in and lien upon the following described property, whether now
owned or hereafter acquired, and any additions, replacements, accessions, or
substitutions thereof and all cash and non-cash proceeds and products thereof
(collectively, "Collateral"):
All of the personal property of Borrower of every kind and nature including,
without limitation, all accounts, equipment, accessions, inventory, chattel
paper, instruments, investment property, documents, letter-of-credit rights,
deposit accounts, and general intangibles, wherever located. Any of the
foregoing terms that are defined in the Uniform Commercial Code ("UCC") shall
have the meaning given to the term in the UCC.
Xxxxxxxx hereby represents and agrees that:
OWNERSHIP. Borrower owns the Collateral free and clear of all liens, security
interests, and claims, and Borrower will keep the Collateral free and clear from
all liens, security interests and claims, other than those granted to or
approved by Xxxxxx.
NAME AND OFFICES; JURISDICTION OF ORGANIZATION. The name and address of Xxxxxxxx
appearing at the beginning of this Agreement are Xxxxxxxx's exact legal name and
the address of its chief executive office. There has been no change in the name
of Xxxxxxxx, or the name under which Borrower conducts business, within the five
years preceding the date hereof except as previously reported in writing to
Lender. Xxxxxxxx has not moved its chief executive office within the five years
preceding the date hereof except as previously reported in writing to Lender.
Borrower is organized under the laws of the State of Delaware and has not
changed the jurisdiction of its organization within the five years preceding the
date hereof except as previously reported in writing to Lender.
TITLE/TAXES. Borrower has good and marketable title to Collateral and will
warrant and defend same against all claims. Borrower will not transfer, sell, or
lease Collateral (except as permitted herein). Xxxxxxxx agrees to pay promptly
all taxes and assessments upon or for the use of Collateral and on this Security
Agreement. At its option, Lender may discharge taxes, liens, security interests
or other encumbrances at any time levied or placed on Collateral. Xxxxxxxx
agrees to reimburse Lender, on demand, for any such payment made by Xxxxxx. Any
amounts so paid shall be added to the Obligations.
WAIVERS. Xxxxxxxx agrees not to assert against Xxxxxx as a defense (legal or
equitable), as a set-off, as a counterclaim, or otherwise, any claims Borrower
may have against any seller or lessor that provided personal property or
services relating to any part of the Collateral or against any other party
liable to
Lender for all or any part of the Obligations. Borrower waives all exemptions
and homestead rights with regard to the Collateral. Borrower waives any and all
rights to any bond or security that might be required by applicable law prior to
the exercise of any of Xxxxxx's remedies against any Collateral. All rights of
Lender and security interests hereunder, and all obligations of Borrower
hereunder, shall be absolute and unconditional, not discharged or impaired
irrespective of (and regardless of whether Xxxxxxxx receives any notice of): (i)
any lack of validity or enforceability of any Loan Document; (ii) any change in
the time, manner or place of payment or performance, or in any term, of all or
any of the Obligations or the Loan Documents or any other amendment or waiver of
or any consent to any departure from any Loan Document; or (iii) any exchange,
insufficiency, unenforceability, enforcement, release, impairment or
non-perfection of any collateral, or any release of or modifications to or
insufficiency, unenforceability or enforcement of the obligations of any
guarantor or other obligor. To the extent permitted by law, Borrower hereby
waives any rights under any valuation, stay, appraisement, extension or
redemption laws now existing or which may hereafter exist and which, but for
this provision, might be applicable to any sale or disposition of the Collateral
by Lender, and any other circumstance which might otherwise constitute a defense
available to, or a discharge of any party with respect to the Obligations.
NOTIFICATIONS; LOCATION OF COLLATERAL. Borrower will notify Lender in writing at
least 30 days prior to any change in: (i) Xxxxxxxx's chief place of business
and/or residence; (ii) Borrower's name or identity; (iii) Borrower's
corporate/organizational structure; or (iv) the jurisdiction in which Borrower
is organized. In addition, Borrower shall promptly notify Lender of any claims
or alleged claims of any other person or entity to the Collateral or the
institution of any litigation, arbitration, governmental investigation or
administrative proceedings against or affecting the Collateral. Borrower will
keep Collateral at the location(s) previously provided to Lender until such time
as Lender provides written advance consent to a change of location Borrower will
bear the cost of preparing and filing any documents necessary to protect
Xxxxxx's liens.
COLLATERAL CONDITION AND LAWFUL USE. Borrower represents that the Collateral is
in good repair and condition and that Borrower shall use reasonable care to
prevent Collateral from being damaged or depreciating, normal wear and tear
excepted. Borrower shall immediately notify Lender of any material loss or
damage to Collateral. Borrower shall not permit any item of Collateral to become
a fixture to real estate or an accession to other personal property unless such
property is also Collateral hereunder. Borrower represents it is in compliance
in all respects with all laws, rules and regulations applicable to the
Collateral and its properties, operations, business, and finances.
RISK OF LOSS AND INSURANCE. Borrower shall bear all risk of loss with respect to
the Collateral. The injury to or loss of Collateral, either partial or total,
shall not release Borrower from payment or other performance hereof. Xxxxxxxx
agrees to obtain and keep in force property insurance on the Collateral with a
Xxxxxx's Loss Payable Endorsement in favor of Xxxxxx and commercial general
liability insurance naming Lender as Additional Insured. Such insurance is to be
in form and amounts satisfactory to Lender and issued by reputable insurance
carriers satisfactory to Lender with a Best Insurance Report Key Rating of at
least "A-". All such policies shall provide to Lender a minimum of 30 days
written notice of cancellation. Borrower shall furnish to Lender such policies,
or other evidence of such policies satisfactory to Lender. If Borrower fails to
obtain or maintain in force such insurance or falls to furnish such evidence
Lender is authorized, but not obligated, to purchase any or all insurance or
"Single Interest Insurance" protecting such interest as Lender deems appropriate
against such risks and for such coverage and for such amounts, including either
the loan amount or value of the Collateral, all at its discretion, and at
Borrower's expense. In such event, Xxxxxxxx agrees to reimburse Lender for the
cost of such insurance and Lender may add such cost to the Obligations. Borrower
shall bear the risk of loss to the extent of any deficiency in the effective
insurance coverage with respect to loss or damage to any of the Collateral.
Borrower hereby assigns to Lender the proceeds of all property insurance
covering the Collateral up to the amount of the Obligations and directs any
insurer to make payments directly to Lender. Borrower hereby appoints Lender its
attorney-in-fact, which appointment shall be irrevocable and coupled with an
interest for so long as Obligations are unpaid, to file proof of loss and/or any
other forms required to collect from any insurer any amount due from any damage
or destruction of Collateral, to agree to and bind Borrower as to the amount of
said recovery, to designate payee(s) of such recovery, to grant releases to
insurer, to grant subrogation rights to any insurer, and to endorse any
settlement check
Page 2
or draft. Xxxxxxxx agrees not to exercise any of the foregoing powers granted to
Xxxxxx without Xxxxxx's prior written consent.
FINANCING STATEMENTS, CERTIFICATES OF TITLE, POWER OF ATTORNEY. No financing
statement (other than any filed or approved by Lender) covering any Collateral
is on file in any public filing office. Borrower authorizes the filing of one or
more financing statements covering the Collateral in form satisfactory to
Lender, and without Xxxxxxxx's signature where authorized by law, agrees to
deliver certificates of title on which Xxxxxx's lien has been indicated covering
any Collateral subject to a certificate of title statue, and will pay all costs
and expenses of filing or applying for the same or of filing this Security
Agreement in all public filing offices, where filing is deemed by Lender to be
desirable. Borrower hereby constitutes and appoints Lender the true and lawful
attorney of Borrower with full power of substitution to take any and all
appropriate action and to execute any and all documents, instruments or
applications that may be necessary or desirable to accomplish the purpose and
carry out the terms of this Security Agreement, including, without limitation,
to complete, execute, and deliver any Control Agreement(s) by Lender, Borrower
and Third Party(ies) that may be or become required in connection herewith
(individually and collectively the "Control Agreement"), and any instructions to
Third Party(ies) regarding, among other things, control and disposition of any
Collateral which is the subject of such Control Agreement(s). The foregoing
power of attorney is coupled with an interest and shall be irrevocable until all
of the Obligations have been paid in full. Neither Lender nor anyone acting on
its behalf shall be liable for acts, omissions, errors in judgment, or mistakes
in fact in such capacity as attorney-in-fact. Borrower ratifies all acts of
Xxxxxx as attorney-in-fact. Xxxxxxxx agrees to take such other actions, at
Xxxxxxxx's expense, as might be requested for the perfection, continuation and
assignment, in whole or in part, of the security interests granted herein and to
assure and preserve Xxxxxx's intended priority position. If certificates,
passbooks, or other documentation or evidence is/are issued or outstanding as to
any of the Collateral, Borrower will cause the security interests of Lender to
be properly protected, including perfection by notation thereon or delivery
thereof to Lender.
LANDLORD/MORTGAGEE WAIVERS. Borrower shall cause each mortgagee of real property
owned by Xxxxxxxx and each landlord of real property leased by Xxxxxxxx to
execute and deliver instruments satisfactory in form and substance to Lender by
which such mortgagee or landlord subordinates its rights, if any, in the
Collateral.
CONTROL. Borrower will cooperate with Xxxxxx in obtaining control with respect
to Collateral consisting of electronic chattel paper. Xxxxxxxx authorizes and
directs Third Party to comply with the terms of this Security Agreement, to
enter into a Control Agreement, to mark its records to show the security
interest of and/or the transfer to Lender of the property pledged hereunder.
CHATTEL PAPER, ACCOUNTS, GENERAL INTANGIBLES. Borrower warrants that Collateral
consisting of chattel paper, accounts, or general intangibles is (i) genuine and
enforceable in accordance with its terms; (ii) not subject to any defense,
set-off, claim or counterclaim of a material nature against Borrower except as
to which Borrower has notified Lender in writing; and (iii) not subject to any
other circumstances that would impair the validity, enforceability, value, or
amount of such Collateral except as to which Borrower has notified Lender in
writing. Borrower shall not amend, modify or supplement any lease, contract or
agreement contained in Collateral or waive any provision therein, without prior
written consent of Lender. Borrower will not create any tangible chattel paper
without placing a legend on the chattel paper acceptable to Lender indicating
that Xxxxxx has a security interest in the chattel paper. Borrower will not
create any electronic chattel paper without taking all steps deemed necessary by
Xxxxxx to confer control of the electronic chattel paper upon Lender in
accordance with the UCC.
ACCOUNT INFORMATION. From time to time, at Xxxxxx's request, Borrower shall
provide Lender with schedules describing all accounts, including customers'
addresses, created or acquired by Xxxxxxxx and at Xxxxxx's request shall execute
and deliver written assignments of contracts and other documents evidencing such
accounts to Xxxxxx. Together with each schedule, Borrower shall, if requested by
Xxxxxx, furnish Lender with copies of Borrower's sales journals, invoices,
customer purchase orders or the equivalent, and original shipping or delivery
receipts for all goods sold, and Borrower warrants the genuineness thereof.
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ACCOUNT DEBTORS. If a Default should occur, Lender shall have the right to
notify the account debtors obligated on any or all of the Collateral to make
payment thereof directly to Lender and Lender may take control of all proceeds
of any such Collateral, which rights Lender may exercise at any time. The cost
of such collection and enforcement, Including attorneys' fees and expenses,
shall be borne solely by Borrower whether the same is incurred by Lender or
Borrower. If a Default should occur or upon demand of Lender, Borrower will,
upon receipt of all checks, drafts, cash and other remittances in payment on
Collateral, deposit the same in a special bank account maintained with Lender,
over which Xxxxxx also has the power of withdrawal.
If a Default should occur, no discount, credit, or allowance shall be granted by
Borrower to any account debtor and no return of merchandise shall be accepted by
Borrower without Xxxxxx's consent. Lender may, after Xxxxxxx, settle or adjust
disputes and claims directly with account debtors for amounts and upon terms
that Xxxxxx considers advisable, and in such cases Lender will credit the
Obligations with the net amounts received by Xxxxxx, after deducting all of the
expenses incurred by Xxxxxx. Xxxxxxxx agrees to indemnify and defend Xxxxxx and
hold it harmless with respect to any claim or proceeding arising out of any
matter related to collection of Collateral.
GOVERNMENT CONTRACTS. If any Collateral covered hereby arises from obligations
due to Borrower from any governmental unit or organization, Borrower shall
immediately notify Lender in writing and execute all documents and take all
actions deemed necessary by Lender to ensure recognition by such governmental
unit or organization of the rights of Lender in the Collateral.
INVENTORY. So long as no Default has occurred, Borrower shall have the right in
the regular course of business, to process and sell Borrower's inventory. If a
Default should occur or upon demand of Lender, Borrower will, upon receipt of
all checks, drafts, cash and other remittances, in payment of Collateral sold,
deposit the same in a special bank account maintained with Lender, over which
Xxxxxx also has the power of withdrawal. Xxxxxxxx agrees to notify Xxxxxx
immediately in the event that any inventory purchased by or delivered to
Borrower is evidenced by a bill of lading, dock warrant, dock receipt, warehouse
receipt or other document of title and to deliver such document to Lender upon
request.
INSTRUMENTS, CHATTEL PAPER, DOCUMENTS. Any Collateral that is, or is evidenced
by, instruments, chattel paper or negotiable documents will be properly assigned
to and the originals of any such Collateral in tangible form deposited with and
held by Lender, unless Lender shall hereafter otherwise direct or consent in
writing. Lender may, without notice, before or after maturity of the
Obligations, exercise any or all rights of collection, conversion, or exchange
and other similar rights, privileges and options pertaining to such Collateral,
but shall have no duty to do so.
COLLATERAL DUTIES. Lender shall have no custodial or ministerial duties to
perform with respect to Collateral pledged except as set forth herein; and by
way of explanation and not by way of limitation, Lender shall incur no liability
for any of the following: (i) loss or depreciation of Collateral (unless caused
by its willful misconduct or gross negligence). (ii) failure to present any
paper for payment or protest, to protest or give notice of nonpayment, or any
other notice with respect to any paper or Collateral.
TRANSFER OF COLLATERAL. Lender may assign its rights in Collateral or any part
thereof to any assignee who shall thereupon become vested with all the powers
and rights herein given to Lender with respect to the property so transferred
and delivered, and Lender shall thereafter be forever relieved and fully
discharged from any liability with respect to such property so transferred, but
with respect to any property not so transferred, Lender shall retain all rights
and powers hereby given.
INSPECTION, BOOKS AND RECORDS. Borrower will at all times keep accurate and
complete records covering each item of Collateral, including the proceeds
therefrom. Lender, or any of its agents, shall have the right, at intervals to
be determined by Lender and without hindrance or delay, at Borrower's expense,
to inspect, audit, and examine the Collateral and to make copies of and extracts
from the books, records, journals, orders, receipts, correspondence and other
data relating to Collateral, Borrower's business or any other transaction
between the parties hereto. Borrower will at its expense furnish Lender
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copies thereof upon request. For the further security of Lender, it is agreed
that Xxxxxx has and is hereby granted a security interest in all books and
records of Borrower pertaining to the Collateral.
COMPLIANCE WITH LAW. Borrower will comply with all federal, state and local laws
and regulations, applicable to it, including without limitation, environmental
and labor laws and regulations, in the creation, use, operation, manufacture and
storage of the Collateral and the conduct of its business.
ATTORNEYS' FEES AND OTHER COSTS OF COLLECTION. Borrower shall pay all of
Lender's reasonable expenses incurred in enforcing this Security Agreement and
in preserving and liquidating Collateral, including but not limited to,
reasonable arbitration, paralegals', attorneys' and experts' fees and expenses,
whether incurred with or without the commencement of a suit, trial, arbitration,
or administrative proceeding, or in any appellate or bankruptcy proceeding.
DEFAULT. If any of the following occurs, a default ("Default") under this
Security Agreement shall exist: LOAN DOCUMENT DEFAULT. A default under any Loan
Document. COLLATERAL LOSS OR DESTRUCTION. Any loss, theft, substantial damage,
or destruction of Collateral not fully covered by insurance, or as to which
insurance proceeds are not remitted to Lender within 30 days of the loss.
COLLATERAL SALE, LEASE OR ENCUMBRANCE. Any sale, lease, or encumbrance of any
Collateral not specifically permitted herein without prior written consent of
Lender. LEVY, SEIZURE OR ATTACHMENT. The making of any levy, seizure, or
attachment on or of Collateral that is not removed within 10 days. UNAUTHORIZED
COLLECTION OF COLLATERAL. Any attempt to collect, cash in or otherwise recover
deposits that are Collateral. THIRD PARTY BREACH. Any default or breach by a
Third Party of any provision contained in any Control Agreement executed in
connection with any of the Collateral. UNAUTHORIZED TERMINATION. Any attempt to
terminate, revoke, rescind, modify, or violate the terms of this Security
Agreement or any Control Agreement without the prior written consent of Lender.
REMEDIES ON DEFAULT (INCLUDING POWER OF SALE). If a Default occurs, all of the
Obligations shall be immediately due and payable, without notice, and Lender
shall have all the rights and remedies of a secured party under the Uniform
Commercial Code. Without limitation thereto, Lender shall have the following
rights and remedies: (i) to take immediate possession of Collateral, without
notice or resort to legal process, and for such purpose, to enter upon any
premises on which Collateral or any part thereof may be situated and to remove
the same therefrom, or, at its option, to render Collateral unusable or dispose
of said Collateral on Borrower's premises; (ii) to require Borrower to assemble
the Collateral and make it available to Lender at a place to be designated by
Lender, and (iii) to dispose of Collateral, as a unit or in parcels, separately
or with any real property interests also securing the Obligations, in any county
or place to be selected by Lender, at either private or public sale (at which
public sale Lender may be the purchaser) with or without having the Collateral
physically present at said sale.
Any notice of sale, disposition or other action by Xxxxxx required by law and
sent to Borrower at Borrower's address shown above, or at such other address of
Borrower as may from time to time be shown on the records of Xxxxxx, at least 5
days prior to such action, shall constitute reasonable notice to Borrower.
Notice shall be deemed given or sent when mailed postage prepaid to Xxxxxxxx's
address as provided herein. Lender shall be entitled to apply the proceeds of
any sale or other disposition of the Collateral, and the payments received by
Lender with respect to any of the Collateral, to Obligations in such order and
manner as Lender may determine. Collateral that is subject to rapid declines in
value and is customarily sold in recognized markets may be disposed of by Lender
in a recognized market for such collateral without providing notice of sale.
Borrower waives any and all requirements that the Lender sell or dispose of all
or any part of the Collateral at any particular time, regardless of whether
Borrower has requested such sale or disposition.
REMEDIES ARE CUMULATIVE. No failure on the part of Lender to exercise, and no
delay in exercising, any right, power or remedy hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise by Lender or any right,
power or remedy hereunder preclude any other or further exercise thereof or the
exercise of any right power or remedy. The remedies herein provided are
cumulative and are not exclusive of any remedies provided by law, in equity, or
in other Loan Documents.
Page 5
INDEMNIFICATION. Borrower shall protect, indemnify and save harmless Lender from
and against all losses, liabilities, obligations, claims, damages, penalties,
causes of action, costs and expenses (including, without limitation, reasonable
attorneys' fees and expenses) (collectively, "Damages") imposed upon, incurred
by or asserted against Lender on account of (i) the Loan Documents or any
failure or alleged failure of Borrower to comply with any of the terms or
representations of this Agreement; (ii) any claim of loss or damage to the
Collateral or any injury or claim of injury to, or death of, any person or
property that may be occasioned by any cause whatsoever pertaining to the
Collateral or the use, occupancy or operation thereof, (iii) any failure or
alleged failure of Borrower to comply with any law, rule or regulation
applicable to the Collateral or the use, occupancy or operation of the
Collateral (including, without limitation, the failure to pay any taxes, fees or
other charges); (iv) any Damages whatsoever by reason of any alleged action,
obligation or undertaking of Lender relating in any way to or any matter
contemplated by the Loan Documents; or (v) any claim for brokerage fees or such
other commissions relating to the Collateral or any other Obligations; provided
that such indemnity shall be effective only to the extent of any Damages that
may be sustained by Lender in excess of any net proceeds received by it from any
Insurance of Borrower (other than self-insurance) with respect to such Damages.
Nothing contained herein shall require Borrower to indemnify Lender for any
Damages resulting from Xxxxxx's gross negligence or its willful misconduct. The
indemnity provided for herein shall survive payment of the Obligations and shall
extend to the officers, directors, employees and duly authorized agents of
Lender. In the event Lender incurs any Damages arising out of or in any way
relating to the transaction contemplated by the Loan Documents (including any of
the matters referred to in this section), the amounts of such Damages shall be
added to the Obligations, shall bear interest, to the extent permitted by law,
at the interest rate borne by the Obligations from the date incurred until paid
and shall be payable on demand.
Page 6
MISCELLANEOUS. AMENDMENTS AND WAIVERS. No waiver, amendment or modification of
any provision of this Security Agreement shall be valid unless in writing and
signed by Xxxxxxxx and an officer of Lender. No waiver by Lender of any Default
shall operate as a waiver of any other Default or of the same Default on a
future occasion. ASSIGNMENT. All rights of Lender hereunder are freely
assignable, in whole or in part, and shall inure to the benefit of and be
enforceable by Xxxxxx, its successors, assigns and affiliates. Borrower shall
not assign its rights and interest hereunder without the prior written consent
of Xxxxxx, and any attempt by Xxxxxxxx to assign without Lenders prior written
consent is null and void. Any assignment shall not release Borrower from the
Obligations. This Security Agreement shall be binding upon Xxxxxxxx, and the
heirs, personal representatives, successors, and assigns of Xxxxxxxx. APPLICABLE
LAW; CONFLICT BETWEEN DOCUMENTS. This Security Agreement shall be governed by
and construed under the law of the jurisdiction named in the address of the
Lender shown on the first page hereof (the "Jurisdiction") without regard to
that Jurisdiction's conflict of laws principles, except to the extent that the
UCC requires the application of the law of a different jurisdiction. If any
terms of this Security Agreement conflict with the terms of any commitment
letter or loan proposal, the terms of this Security Agreement shall control.
JURISDICTION. Borrower irrevocably agrees to non-exclusive personal jurisdiction
in the state identified as the Jurisdiction above. SEVERABILITY. If any
provision of this Security Agreement shall be prohibited by or invalid under
applicable law, such provision shall be ineffective but only to the extent of
such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Security Agreement. NOTICES. Any
notices to Borrower shall be sufficiently given, if in writing and mailed or
delivered to the address of Borrower shown above or such other address as
provided hereunder, and to Lender, if in writing and mailed or delivered to the
address of Lender shown above, or such other address as Lender may specify in
writing from time to time. In the event that Xxxxxxxx changes Xxxxxxxx's mailing
address at any time prior to the date the Obligations are paid in full, Xxxxxxxx
agrees to promptly give written notice of said change of address by registered
or certified mail, return receipt requested, all charges prepaid. CAPTIONS. The
captions contained herein are inserted for convenience only and shall not affect
the meaning or interpretation of this Security Agreement or any provision
hereof. The use of the plural shall also mean the singular, and vice versa.
JOINT AND SEVERAL LIABILITY. If more than one party has signed this Security
Agreement, such parties are jointly and severally obligated hereunder. BINDING
CONTRACT. Borrower by execution and Lender by acceptance of this Security
Agreement, agree that each party is bound by all terms and provisions of this
Security Agreement.
DEFINITIONS. LOAN DOCUMENTS. The term "Loan Documents" refers to all documents,
including this Agreement, whether now or hereafter existing, executed in
connection with or related to the Obligations, and may include, without
limitation and whether executed by Xxxxxxxx or others, commitment letters that
survive closing, loan agreements, promissory notes, guaranty agreements, deposit
or other similar agreements, other security agreements, letters of credit and
applications for letters of credit, security instruments, financing statements,
mortgage instruments, any renewals or modifications, whenever any of the
foregoing are executed. THIRD PARTY. The term "Third Party" means any Broker,
Collateral Agent, Securities Intermediary and/or bank which from time to time
maintains a securities account, and is acting in such capacity, for Borrower or
maintains a deposit account for Borrower with respect to any part of the
Collateral. UCC. "UCC" means the Uniform Commercial Code as presently and
hereafter enacted in the Jurisdiction. TERMS DEFINED IN THE UCC. Any term used
in this Agreement and in any financing statement filed in connection herewith
which is defined in the UCC and not otherwise defined in this Agreement or any
other Loan Document has the meaning given to the term in the UCC.
IN WITNESS WHEREOF, Xxxxxxxx, on the day and year first written above, has
caused this Security Agreement to be executed under seal.
Page 7
HISPANIC TELEVISION NETWORK, INC. d/b/a
FIRESTONE COMMUNICATIONS, INC.
Taxpayer Identification Number:________
By: /s/ Xxxxxxx X. Xxxxxxxxx
-----------------------------------
Xxxxxxx X. Xxxxxxxxx, Chairman
and CEO
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