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Exhibit 10.52
FORM OF SECURITY AGREEMENT
(Caminus Corporation)
THIS SECURITY AGREEMENT, dated as of January ___, 2000 (the "Agreement"
or the "Security Agreement"), is between Caminus Corporation, a Delaware
corporation, as obligor (the "Obligor"), and Fleet Bank, N.A., a national
banking association organized under the laws of the United States, as lender
(hereinafter, in such capacity, together with its successors in such capacity,
the "Lender").
As of June 23, 1999, Caminus LLC, a Delaware limited liability
corporation, (the "Prior Debtor") and the Lender were parties to a Credit
Agreement (such Credit Agreement, as the same may be amended or supplemented
from time to time is referred to herein as the "Credit Agreement") providing,
subject to the terms and conditions thereof, for extensions of credit to be made
by the Lenders to the Prior Debtor in an aggregate principal amount not
exceeding $5,000,000.00 (the "Loans"). Pursuant to a certain merger agreement
between the Obligor and the Prior Debtor, dated _________, 2000 (the "Merger
Agreement"), the Obligor has become the successor by Merger to the Prior Debtor
and, accordingly, has assumed the liabilities of the Prior Debtor. To induce the
Lender to consent to the Merger of the Prior Debtor with and into the Obligor,
in accordance with the terms and conditions of that certain Consent Letter,
dated as of ___________, 2000 between the Lender, the Prior Debtor and the
Obligor, the Obligor agreed to execute and deliver this Security Agreement to
the Lender.
For other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Obligor has agreed to execute and deliver
this Agreement.
As used herein, "UCC" shall mean the Uniform Commercial Code of the
State of New York (except as otherwise defined in Section 7 hereof) as amended
and in effect as of the date hereof. All other capitalized terms, unless defined
herein or in the Schedules attached hereto and made a part hereof, shall have
the meanings set forth in the Credit Agreement.
SECTION 1. Security Interest.
1(a) As security for the prompt and complete payment, performance
and observance of all indebtedness, obligations, liabilities and agreements of
the Obligor to the Lender pursuant to, under or arising out of the Credit
Agreement, the Notes, the other Loan Documents and any amendments, extensions,
renewals, increases, refundings or modifications thereto or of any part thereof,
whether now existing or hereafter incurred, matured or unmatured, direct or
contingent, together with interest and costs of enforcement and collection
thereof and of this Security Agreement, including all reasonable actual
attorneys' fees and disbursements incurred by the Lenders (collectively, the
"Liabilities"), the Obligor hereby grants to the Lender, a continuing security
interest of first priority in, and the Obligor hereby assigns and pledges to the
Lender, all of the Obligor's right, title and interest in the property described
on Schedule A-1 attached hereto, whether now owned by the Obligor or hereafter
coming into existence, and wherever located (all being collectively referred to
herein as the "Collateral").
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1(b) The Obligor irrevocably appoints the Lender as its lawful
attorney and agent to execute financing statements and amendments thereto (to
the extent permitted by applicable law), notices of any assignments of any of
the Collateral on the Obligor's behalf, and on its behalf to file financing
statements and amendments thereto in any appropriate public office.
1(c) This Security Agreement is in addition to and without
limitation of any right of the Lender and/or any of the other Lender under any
other security agreement, pledge or leasehold assignment, mortgage or guarantee
granted by the Obligor or any third party to the Lender.
1(d) Except as otherwise herein provided, this Security Agreement is
absolute and without any conditions. The Lender can enforce its rights in the
Collateral immediately upon an Event of Default without having first to attempt
any collection from the Obligor.
SECTION 2. Collection.
Upon the occurrence and continuation of an Event of Default pursuant to
Section 9(a) hereof, the Lender shall have the following rights and powers in
addition to those specified in Section 9(b) hereof:
2(a) The Lender shall have the right to notify the parties obligated
on any or all of the Obligor's Accounts, Contracts, Chattel Paper, Instruments,
Insurance, Documents or General Intangibles to make payment thereof directly to
the Lender, and the Lender may take control of all proceeds of any of the
Accounts, Contracts, Chattel Paper, Instruments, Insurance or General
Intangibles. The costs of collection and enforcement, including reasonable
attorney's fees and reasonable out-of-pocket expenses, shall be borne solely by
the Obligor, whether the same are incurred by the Lender or the Obligor. The
Obligor will not thereafter without the Lender's written consent make any
adjustment, extend or renew, compromise, compound or settle any of the Accounts,
Contracts, Chattel Paper, Instruments, Insurance or General Intangibles, or
release, wholly or partly, any person liable for payment thereof.
2(b) The Obligor hereby irrevocably appoints the Lender to be the
Obligor's true and lawful attorney, with full power of substitution, in the
Lender's name or the Obligor's name or otherwise for the Lender's sole use and
benefit, but at the Obligor's cost and expense, to exercise at any time all or
any of the following powers with respect to all or any of the Collateral:
(i) to demand, xxx for, collect, receive and give acquittance for
any and all moneys due or to become due upon or by virtue
thereof;
(ii) to receive, take, sign, endorse, assign and deliver any and all
checks, notes, drafts, acceptances, invoices, freight or
express bills, bills of lading, storage or warehouse receipts,
drafts against debtors, assignments, verifications, notices and
other negotiable and non-negotiable instruments and documents
taken or received by the Lender in connection therewith;
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(iii) to receive, open and dispose of all mail addressed to the
Obligor and to notify the post office authorities to change the
address for delivery of mail addressed to the Obligor to such
address as the Lender may designate;
(iv) to sign the name of the Obligor on any Document, on invoices
relating to any Account or Contract, drafts against and notices
to account debtors or obligors of the Obligor, on financing
statements and other public records and on notices to
customers;
(v) to execute endorsements, assignments or other instruments of
conveyance or transfer and proofs of claim and loss and to
adjust and compromise any claims under insurance policies or
otherwise;
(vi) to settle, compromise, compound, prosecute or defend any action
or proceeding with respect thereto;
(vii) to sell, transfer, assign or otherwise deal in or with the same
or the proceeds thereof and to apply for and obtain any
required consents of governmental authority for any sale or
other disposition of the Collateral, as full and effectually as
if the Lender were the absolute owner thereof; and
(viii) to apply any or all amounts then in, or thereafter deposited
in, the Company Account in the manner provided in Section
9(b)(iii) hereof; and
(ix) to make any allowances and other adjustments with reference
thereto and to take all other actions necessary or advisable in
the sole discretion of the Lender to carry out and enforce this
Security Agreement or the Liabilities.
All acts done under the foregoing authorization are hereby ratified and
approved by the Obligor and neither the Lender nor any designee or agent of the
Lender shall be liable for any acts of commission or omission (other than acts
committed or omitted through gross negligence or willful misconduct), for any
error of judgment or for any mistake of fact or law. The foregoing power of
attorney being coupled with an interest is irrevocable while any Liabilities
shall remain unpaid. The foregoing authorization shall not be construed in
limitation of any other similar authorization to the Lender under the Credit
Agreement or otherwise.
2(c) The Obligor will immediately deliver to the Lender all proceeds
of the Collateral and all original evidence of Accounts, Contracts, Chattel
Paper, Instruments, Insurance, Documents, Patents, Trademarks, Records or
General Intangibles, including without limitation all notes or other instruments
or contracts for the payment of money, appropriately endorsed to the Lender's
order and, regardless of the form of such endorsement, the Obligor hereby waives
presentment, demand, notice of dishonor, protest and notice of protest and all
other notices with respect thereto; and the Obligor hereby appoints the Lender
as the Obligor's agent and attorney-in-fact to make such endorsement on behalf
of and in the name of the Obligor.
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2(d) The exercise by the Lender of or failure to so exercise any
authority granted hereinabove shall in no manner affect the Obligor's liability
to the Lender, and provided, further, that the Lender shall be under no
obligation or duty to exercise any of the powers hereby conferred upon it and it
shall be without liability for any act or failure to act in connection with the
collection of, or the preservation of any rights under any of, the Collateral.
SECTION 3. General Representations and Warranties.
In addition to the Obligor's representations made in the other Loan
Documents, the Obligor represents and warrants to the Lender, which
representations and warranties shall survive execution and delivery of this
Agreement, as follows:
3(a) All filings, registrations and recordings necessary or
appropriate to create, preserve, protect and perfect the security interest
granted by the Obligor to the Lender hereby in respect to the Collateral have
been accomplished and the security interest granted to the Lender pursuant to
this Agreement in and to the Collateral constitutes a perfected security
interest therein superior and prior to the rights of all other Persons therein
(except for Liens permitted under the Credit Agreement) and subject to no other
Liens (except for Liens permitted under the Credit Agreement), and is entitled
to all the rights, priorities and benefits afforded by the UCC or other relevant
laws as enacted in any relevant jurisdiction to perfected security interests.
3(b) The Obligor is, and as to Collateral acquired by it from time
to time after the date hereof the Obligor will be, the owner of all Collateral
free from any Lien, security interest, encumbrance or other right, title or
interest of any Person (other than Liens permitted under the Credit Agreement),
and the Obligor shall defend its Collateral against all claims and demands of
all Persons at any time claiming the same or any interest therein adverse to the
Lender.
3(c) There is no financing statement (or similar statement or
instrument of registration under the law of any jurisdiction) covering or
purporting to cover any interest of any kind in the Collateral except for
filings and recordings permitted under the Credit Agreement and filings and
recordings in favor of the Lender created or provided for herein, and so long as
any of the Liabilities remain unpaid the Obligor will not execute or authorize
to be filed in any public office any financing statement (or similar statement
or instrument of registration under the law of any jurisdiction) or statements
relating to the Collateral, except (i) financing statements filed or to be filed
in respect of and covering the security interests granted hereby by the Obligor,
and (ii) financing statements to be filed in connection with the creation of
Liens permitted under the Credit Agreement.
3(d) The office location(s) of the Obligor set forth on Schedule B
attached hereto as the Obligor's principal place of business and chief executive
office and all other places of business are true and correct.
3(e) Schedule B attached hereto contains a true and complete listing
of all of the locations of all the Collateral. In the case of Inventory,
Schedule B also sets forth each Warehouseman (as defined in the Uniform
Commercial Code as in effect in the state in which the warehouse owned or
operated by such Person is located) that from time to time holds Inventory of
the Obligor and the Permitted Inventory Location (as defined herein) at which
such
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Inventory is so held. In the case of such Inventory, the Obligor further
represents and warrants that none of the Inventory is subject to a negotiable
warehouse receipt (as defined in the Uniform Commercial Code as in effect in the
state in which such Inventory is located).
3(f) The Obligor further represents and warrants, as to any
Inventory, that all such Inventory, other than Inventory in transit in the
normal course of business, is held at a Permitted Inventory Location (as defined
herein). "Permitted Inventory Location" is defined herein to mean (i) a
warehouse or other storage facility owned or leased by the Obligor, or (ii) a
warehouse or other storage facility owned, leased or operated by a Warehouseman
from whom the Lender has received a warehouse bailment agreement in form and
substance satisfactory to the Lender with respect to Inventory there held, and,
in either case, in jurisdictions where appropriate UCC financing statements
shall have liens filed against the Obligor for the benefit of the Lender and the
other Lender.
SECTION 4. Special Provisions Concerning Accounts.
4(a) As of the time when each of its Accounts arises, the Obligor
shall be deemed to have represented and warranted that such Accounts and all
records, papers and documents relating thereto (if any) are genuine and in all
respects what they purport to be, and that all papers and documents (if any)
relating thereto (i) will represent the genuine, legal, valid and binding
obligation of the account debtor evidencing indebtedness unpaid and owed by such
account debtor arising out of the performance of labor or services or the sale
or lease and delivery of the merchandise listed therein, or both, (ii) will be
the only original writings evidencing and embodying such obligation of the
account debtor named therein (other than copies created for purposes other than
general accounting purposes), (iii) will evidence true and valid obligations,
enforceable in accordance with their respective terms, not subject to the
fulfillment of any contract or condition whatsoever or to any defenses, set offs
or counterclaims (except with respect to refunds, returns and allowances in the
ordinary course of business), or stamp or other taxes, and (iv) will be in
compliance and will conform with all applicable federal, state and local laws
and applicable laws of any relevant foreign jurisdiction.
4(b) The Obligor will keep and maintain at its own cost and expense
satisfactory and complete records of its Accounts, including, but not limited
to, records of all payments received, credits granted thereon, all merchandise
returned and all other dealings therewith, and the Obligor will make the same
available to the Lender for inspection, at the Obligor's own cost and expense,
at any and all reasonable times upon demand.
4(c) The Obligor shall endeavor to cause to be collected from the
account debtor named in each of its Accounts, as and when due (including,
without limitation, Accounts which are delinquent, such Accounts to be collected
in accordance with generally accepted lawful collection procedures), any and all
amounts owing under or on account of such Accounts, and apply forthwith upon
receipt thereof all such amounts as are so collected to the outstanding balance
of such Accounts, except that, so long as no Event of Default exists and is
continuing, the Obligor may allow in the ordinary course of business as
adjustments to amounts owing under its Accounts an extension or renewal of the
time or times of payment, or settlement for less than the total unpaid balance,
which the Obligor finds appropriate in accordance with sound business
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judgment. The costs and expenses (including, without limitation, attorneys' fees
and expenses) of collection, whether incurred by the Obligor or the Lender,
shall be borne by the Obligor.
4(d) If any of the Accounts becomes evidenced by an Instrument, the
Obligor will within ten (10) days notify the Lender thereof, and upon request by
the Lender promptly deliver such Instrument to the Lender appropriately endorsed
to the order of the Lender as further security hereunder.
4(e) The Obligor will, at its own expense, make, execute, endorse,
acknowledge, file and/or deliver to the Lender from time to time such vouchers,
invoices, schedules, confirmatory assignments, conveyances, financing
statements, transfer endorsements, powers of attorney, certificates, reports and
other assurances or instruments and take such further steps relating to its
Accounts and other property or rights covered by the security interest hereby
granted, as the Lender may reasonably require which are consistent with the
terms hereunder.
SECTION 5. Special Provisions Concerning Contracts.
5(a) The Obligor represents and warrants that no consent of any
party (other than the Obligor) to any Contract is required, or purports to be
required, in connection with the execution, delivery and performance of this
Security Agreement. Each Contract is in full force and effect and is enforceable
in accordance with its respective terms and there is no default under any of the
terms thereof. The Obligor does hereby further represent and warrant that it has
not assigned or pledged, and hereby covenants that it will not assign or pledge,
except as permitted under the Credit Agreement, the whole or any part of the
rights hereby assigned to anyone other than the Lender, its successors or
assigns so long as this Security Agreement shall remain in effect. The Obligor
also covenants and agrees that it will not take any action or fail to take any
action or institute any proceedings the taking or omission of which might result
in the material alteration or impairment of this Security Agreement or any of
the material rights created by any of the Contracts or this Security Agreement.
Except as specified by a detailed notation corresponding to the applicable
Contract on Schedule A-2, the Obligor hereby further represents and warrants
that no consent or authorization of, filing with or other act by or in respect
of any Governmental Authority is required in connection with the execution,
delivery, performance, validity or enforceability of any of the Contracts by any
party thereto other than those which have been duly obtained, made or performed,
are in full force and effect and do not subject the scope of any such Contract
to any material adverse limitations, either specific or general in nature. The
right, title and interest of the Obligor in, to and under each Contract are not
subject to any defense, offset, counterclaim or claim which could reasonably be
expected to have a Material Adverse Effect, nor, as of the date of this Security
Agreement and to the best of the Obligor's knowledge, have any of the foregoing
been asserted or alleged against the Obligor as to any Contract. The Obligor has
delivered to the Lender a complete and correct copy of each Contract, including
all amendments, supplements and other modifications thereto. No amount payable
to the Obligor under or in connection with any Contract is evidenced by any
Instrument or Chattel Paper which has not been delivered to the Lender.
The Obligor agrees that, so long as this Security Agreement is in
effect, it will not, without the prior written consent of the Lender, amend,
modify or permit to be amended or modified any of the Contracts or waive or
permit to be waived any material provisions of any of
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the Contracts, or exercise any right to terminate or cancel any of the Contracts
or consent or agree to, or suffer or permit, the termination thereof whether or
not on account of any default therein specified if any such amendment,
modification or waiver, termination or cancellation could have a Material
Adverse Effect.
SECTION 6. Rights and Obligations Concerning Accounts and Contracts.
6(a) Anything herein to the contrary notwithstanding, the Obligor
shall remain liable under each of the Accounts and Contracts to observe and
perform all the conditions and obligations to be observed and performed by it
thereunder, all in accordance with the terms of any agreement giving rise to
each such Account and in accordance with and pursuant to the terms and
provisions of each such Contract. The Lender shall have no obligation or
liability under any Account (or any agreement giving rise thereto) or under any
Contract by reason of or arising out of this Security Agreement or the receipt
by the Lender of any payment relating to such Account or Contract pursuant
hereto, nor shall the Lender be obligated in any manner to perform any of the
obligations of the Obligor under or pursuant to any Account (or any agreement
giving rise thereto) or under or pursuant to any Contract, to make any payment,
to make any inquiry as to the nature or the sufficiency of any payment received
by it or as to the sufficiency of any performance by any party under any Account
(or any agreement giving rise thereto) or under any Contract, to present or file
any claim, to take any action to enforce any performance or to collect the
payment of any amounts which may have been assigned to it or to which it may be
entitled at any time or times.
6(b) The Obligor hereby agrees that no liability shall be asserted
or enforced against the Lender in the exercise of the rights and powers granted
to the Lender hereunder, all such liability being hereby expressly waived and
released by the Obligor. Without limiting the application of Section 11(a)
hereof, the Obligor hereby agrees to indemnify and hold the Lender harmless for
and against any and all liability, expense, cost, loss or damage which the
Lender may incur by reason of any act or omission of the Obligor under any of
the Contracts ("Losses"), except to such extent such Losses arise by reason of
the gross negligence or willful misconduct of the Lender. Should the Lender
incur any liability, expense, cost, loss, or damage, (i) under the Contracts for
which it is to be indemnified by the Obligor as aforesaid, or (ii) by reason of
the exercise of the Lender's rights hereunder, the amount thereof, including
costs, expenses and reasonable actual attorney's fees and expenses, shall be
secured hereby and shall be immediately due and payable by the Obligor to the
Lender.
6(c) The Lender has the right to make test verifications of the
Accounts in any manner and through any medium that it reasonably considers
advisable, and the Obligor shall furnish all such assistance and information as
the Lender may require in connection therewith. At any time and from time to
time, upon the Lender's request and at the expense of the Obligor, the Obligor
shall cause independent public accountants or others satisfactory to the Lender
to furnish to the Lender reports showing reconciliations, aging and test
verifications of, and trial balances, for, the Accounts. The Lender may in its
own name or in the name of others communicate with account debtors on the
Accounts and parties to the Contracts to verify with them to its satisfaction
the existence, amount and terms of any Accounts or Contracts, provided that, so
long as no Event of Default has occurred and is continuing, the Lender agrees to
provide the Obligor notice prior to initiating such verification.
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6(d) The Obligor shall promptly notify the Lender of, and provide to
the Lender copies of, any default notices under any of the Contracts.
SECTION 7. Special Provisions Concerning Patents and Trademarks.
7(a) The Obligor represents and warrants that it is the true and
lawful exclusive owner of the entire and unencumbered right, title and interest
in and to each of the Trademarks listed on Schedule A-3 and the Patents listed
on Schedule A-4 attached hereto, free and clear of all liens and encumbrances
(including, without limitation, any covenant not to xxx a third party); that the
Trademarks and Patents are subsisting, valid, enforceable, and have not been
adjudged invalid or unenforceable, in whole or in part; and that the Trademarks
and the Patents constitute all the registered trademarks and patents,
respectively, in the United States Patent and Trademark Office and
non-registered trademarks that the Obligor now owns or uses in connection with
its business.
7(b) The Obligor represents and warrants that it has made all
necessary filings and recordations to protect its interest in the Trademarks,
Patents, and its other intellectual property; that it has and will continue to
pay all required taxes, fees, and costs to maintain all of its rights in the
Trademarks, Patents, and its other intellectual property; and that it has
received no notice or claim that its use of any of the Trademarks, Patents, or
other intellectual property infringes the rights of any third party.
7(c) Prior to licensing or assigning any of the Trademarks, Patents,
or its other intellectual property, the Obligor will give the Lender written
notice of any such license or assignment plus a copy of the draft license
agreement or assignment, and, upon execution, a copy of any final agreement or
assignment.
7(d) The Obligor shall, promptly upon learning thereof, notify the
Lender in writing of the name and address of, and furnish such pertinent
information that may be available with respect to, any party who may be
infringing or otherwise violating any of the Obligor's rights in and to any
Trademarks, Patents, or other intellectual property or of any party who makes a
claim that the use of any of the Trademarks, Patents, or other intellectual
property otherwise violates any property of any nature of that party or any
third party. Unless the Obligor shall reasonably determine that such Trademark,
Patents, or other intellectual property is not of material economic value to the
Obligor, the Obligor further shall diligently prosecute any and all persons who
infringe any of its Trademarks, Patents, or other intellectual property to
recover any and all damages and take such other actions as the Obligor shall
deem appropriate under the circumstances to protect such Trademarks, Patents, or
other intellectual property. The Lender shall have the option, but not the
obligation, to participate in any such action at Obligor's expense and to
maintain suits against parties for infringement or misappropriation if Lender
believes the Obligor is not diligently and vigorously proceeding in such
action(s).
7(e) If any trademark or service xxxx registration or patent
registration is issued hereafter to the Obligor as a result of any application
or registration now or hereafter pending before the United States Patent and
Trademark Office or foreign equivalent thereof, the Obligor shall forthwith
execute and deliver a copy of the certificate of registration within thirty (30)
days of receipt of such certificate and a grant of security in such trademark,
service xxxx or
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patent to the Lender confirming the grant thereof hereunder, the form of such
confirmatory grant to be substantially the same as the form hereof.
7(f) The Obligor will perform all acts and execute all documents
including, without limitation, documents in form suitable for filing with the
United States Patent and Trademark Office, other governmental office, and any
foreign equivalent thereof, as reasonably requested by the Lender at any time to
evidence, perfect, maintain, record and enforce the Lender's interest in the
Trademarks, Patents, and the Obligor's other intellectual property or otherwise
in furtherance of the provisions of this Agreement. In the event of foreclosure
hereunder upon all or any part of the Collateral, the Obligor shall, and hereby
does, constitute the Lender as the Obligor's attorney-in-fact to transfer, in
the Obligor's name, the Trademarks (including all goodwill associated with the
Trademarks), the Patents, and the Obligor's other intellectual property to a
third party capable, in the Lender's judgment, of using and maintaining the
nature and quality of the Trademarks, the Patents, and the Obligor's other
intellectual property. Such power-of-attorney shall include, without limitation,
the right to execute all documents and to do all acts as the Lender considers
necessary to effect any of the foregoing, and all acts of such attorney are
hereby ratified and confirmed; such power being coupled with an interest which
is irrevocable until the Liabilities are paid in full.
7(g) Except to the extent that the Lender shall consent in writing,
the Obligor will, unless the Obligor shall reasonably determine that a Trademark
is not of material economic value to the Obligor, (i) continue to use each
Trademark in order to maintain each Trademark in full force free from any claim
of abandonment for non-use, (ii) employ each Trademark with the appropriate
notice of application or registration, (iii) not adopt or use any xxxx which is
confusingly similar or a colorable imitation of any Trademark, (iv) not use any
Trademark except for the uses for which registration or application for
registration of such Trademark has been made, (v) not (and not permit any
licensee or sublicensee thereof, if any, to) do any act or knowingly omit to do
any act whereby any Trademark may be subject to dilution, misappropriation, or
invalidation, and (vi) ensure and warrant that the quality of the goods and
services bearing each applicable Trademark will be maintained at not less than
the quality level thereof as exists as of the date of this Agreement, and in
that regard, during normal business hours the Lender and its representatives may
inspect the Obligor's books, records, and facilities which manufacture, inspect,
or store products to ensure that quality of the applicable goods and services
are being maintained.
7(h) The Obligor shall notify the Lender immediately if it knows, or
has reason to know, of any reason that any application or registration relating
to any Trademark, Patent, or other intellectual property of the Obligor may
become abandoned or of any adverse determination or development (including,
without limitation, the institution of, or any such determination or development
in, any proceeding in the United States Patent and Trademark Office or any
court) regarding the Obligor's ownership of any Trademark, Patent, other
intellectual property, its right to register or use the same, or to keep and
maintain the same.
7(i) In no event shall the Obligor, either itself or through any
agent, employee, licensee or designee, file an application for the registration
of any Trademark, Patent, or other intellectual property with the United States
Patent and Trademark Office, other governmental office, or any similar office or
agency in any other country or any political subdivision thereof,
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unless it promptly informs the Lender, and, upon request of the Lender, executes
and delivers any and all agreements, instruments, documents and papers as the
Lender may request to evidence the Lender's security interest in such Trademark,
Patent, or other intellectual property and the goodwill and general intangibles
of the Obligor relating thereto or represented thereby, and the Obligor hereby
constitutes the Lender its attorney-in-fact to execute and file all such
writings for the foregoing purposes, including without limitation to modify this
Agreement by amending Schedule A-3 and/or Schedule A-4 (as the case may be) to
include any future Trademarks, Patents, and other intellectual property, all
acts of such attorney being hereby ratified and confirmed; such power being
coupled with an interest which is irrevocable until the Liabilities are paid in
full.
7(j) The Obligor will take all commercially reasonable steps,
including, without limitation, in any proceeding before the United States Patent
and Trademark Office, any other governmental office, or any other office or
agency in any other country or any political subdivision thereof, to maintain
and pursue each application (and to obtain the relevant registration) and to
maintain each registration of the Trademarks and Patents, except to the extent
permitted under Section 7(g), including but not limited to the appropriate and
timely payment of any required fees and the appropriate and timely filing of any
documents or declarations necessary to maintain and renew such Trademarks and
Patents which may be necessary or appropriate under applicable federal, state,
and foreign law.
7(k) Upon the occurrence and during the existence of an Event of
Default, the Lender may, by written notice to the Obligor, take any or all of
the following actions: (i) declare the entire right, title and interest of the
Obligor in and to each of the Trademarks, Patents, and other intellectual
property, together with all related rights and rights of protection to the same,
vested, in which event such rights, title and interest shall immediately vest,
in the Lender, in which case the Obligor agrees to execute assignments in form
and substance satisfactory to the Lender, of all its rights, title and interest
in and to the Trademarks, Patents, and other intellectual property to the
Lender; (ii) take and use or sell the Trademarks, Patents, and other
intellectual property and the goodwill of the Obligor's business symbolized by
the Trademarks and the right to carry on the business of such Obligor in
connection with which the Trademarks have been used; and (iii) direct the
Obligor to refrain, in which event the Obligor shall refrain, from using the
Trademarks, Patents, and its other intellectual property in any manner
whatsoever, directly or indirectly, and, if requested by the Lender, change the
Obligor's corporate name to eliminate therefrom any use of any Trademarks and
execute such other and further documents that the Lender may request to further
confirm this and to transfer ownership of the Trademarks, Patents, and other
intellectual property, and any pending trademark and patent application(s) for
trademarks, patents, and other intellectual property in the United States Patent
and Trademark Office, any other governmental office, and in any similar foreign
office to the Lender. After any Event of Default, the Obligor shall cooperate
and use its best efforts to obtain any consents, waivers, or agreements
necessary to enable the Lender to exercise its rights and remedies with respect
to any Trademark, Patent, and other intellectual property of the Obligor.
SECTION 8. Covenants of Obligor.
In addition to the Obligor's covenants contained in the Credit
Agreement, the Obligor covenants that:
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8(a) Subject to Section 3(e) and Section 3(f) hereof, the Collateral
is and will be located at the Obligor's chief executive office and such other
places of business and Permitted Inventory Locations as indicated on Schedule B
attached hereto. The Obligor's records of the Collateral will be located at the
Obligor's chief executive office. The chief executive office of the Obligor is
located at the address shown on Schedule B attached hereto. The Obligor will not
move its chief executive office, the location of the Collateral or any Records
Office (as defined below) except to such new location as the Obligor may
establish in accordance with the last sentence of this Section 8(a) and with
respect to Inventory, to Permitted Inventory Locations. The originals of all
documents and all electronically stored data and information evidencing all
Accounts and Contracts of the Obligor and the only original books of account and
records of the Obligor relating thereto are, and will continue to be, kept at
its chief executive office shown on Schedule B attached hereto (each, a "Records
Office"), or at such new Records Office as the Obligor may establish in
accordance with the last sentence of this Section 8(a). All Accounts, Contracts
and records of the Obligor are, and will continue to be, maintained at, and
controlled and directed (including, without limitation, for general accounting
purposes) from, such Records Office location shown above, or such new location
as the Obligor may establish in accordance with the last sentence of this
Section 8(a). The Obligor shall not establish a new location for its chief
executive office, the location of the Collateral or any Records Office until (i)
it shall have given to the Lender not less than 45 days' prior written notice of
its intention so to do, clearly describing such new location and providing such
other information in connection therewith as the Lender may reasonably request,
and (ii) with respect to such new location, it shall have taken all action,
satisfactory to the Lender, to maintain the security interest of the Lender in
the Collateral intended to be granted hereby at all times fully perfected and in
full force and effect.
8(b) The Collateral used or useful in its business, in whomsoever's
possession they may be, shall be kept in good repair, working order and
condition, and that from time to time there will be made to such Collateral all
needful and proper repairs, renewals, replacements, extensions, additions,
betterments and improvements thereto, to the extent and in the manner customary
for companies in similar lines of business under similar circumstances. The
Obligor will not encumber, sell, erase, transfer, assign, abandon or otherwise
dispose of the Collateral except for: (i) collection, discharge, discount,
compromise or expiration of the Accounts, Chattel Paper, Instruments or General
Intangibles in the ordinary course of the Obligor's business, (ii) sale or
transfer of Inventory in the ordinary course of business, (iii) dispositions of
items of Equipment no longer needed by the Obligor in the ordinary course of
business, (iv) Liens as permitted under the Credit Agreement and (v) trade-ins,
replacements or exchanges of items of Equipment for other items of Equipment to
the extent the same shall promptly be replaced by Equipment having an equal or
greater value (in excess of purchase money liens on such items) and useful in
the Obligor's business. The inclusion of "products" and "proceeds" of the
Collateral under the security interest granted herein shall not be deemed a
consent by the Lender to any sale or other disposition of the Collateral except
as expressly permitted herein or in the Credit Agreement.
8(c) The Obligor will have and maintain insurance at its expense as
required of the Company pursuant to Section 6.04 of the Credit Agreement. The
Lender is authorized by the Obligor to act as its attorney in collecting,
adjusting, settling or cancelling such insurance and endorsing any drafts drawn
by insurers. The Lender may apply any insurance proceeds received by it to the
Liabilities, whether due or not; provided, however, that the Lender will hold
such
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proceeds as a special deposit for use by the Obligor in replacing any damaged
Equipment which gave rise to such proceeds, so long as the Obligor is taking
steps to replace such Equipment with due diligence and in good faith and so long
as no Event of Default has occurred and is continuing hereunder. The Obligor
will immediately notify the Lender of any damage to or loss of the Collateral in
excess of $50,000. Not later than the expiration date of each insurance policy
then in effect, the Obligor shall deliver to the Lender a certificate of
insurance certifying as to (i) the extension of such policy or the issuance of a
renewal policy therefor, describing the same in reasonable detail satisfactory
to the Lender and (ii) the payment in full of the portion of the premium
therefor then due and payable (or accompanied by other proof of such payment
satisfactory to the Lender). The Obligor shall be required forthwith to notify
the Lender if the Obligor shall determine at any time not to, or at any time be
unable to, extend or renew any such insurance policy then in effect.
8(d) The Obligor will use the Collateral for business purposes and
not for personal, family, household or farming purposes and not in violation of
any statute or ordinance.
8(e) The Obligor will pay promptly when due all taxes,
contributions, charges or levies and assessments upon the Collateral owned by
the Obligor or upon its use or sale (other than those the amount or validity of
which is currently being contested in good faith by appropriate proceeding and
with respect to which appropriate reserves are maintained on the books of the
Obligor in accordance with GAAP). At its option the Lender may discharge taxes,
liens or other encumbrances at any time levied against or placed on the
Collateral which have not been stayed as to execution and contested with due
diligence in appropriate legal proceedings, and the Lender may pay for insurance
on the Collateral and maintenance and preservation of the Collateral if the
Obligor fails to do so. The Obligor shall reimburse the Lender on demand for any
such expense incurred by the Lender pursuant to the foregoing authorization,
together with interest thereon, from the date paid by the Lender until payment
in full by the Obligor, at the per annum rate of the Base Rate plus four percent
(4%).
8(f) The Obligor will at all times and in all material respects keep
accurate and complete records of the Collateral. Subject to such notice required
pursuant to the Credit Agreement (if any), the Lender, or any of its agents,
shall have the right (in addition to the rights granted to the Lender pursuant
to Section 6(c) hereof) to call at the Obligor's place or places of business
during normal business hours, at intervals to be determined by the Lender, to
examine and inspect the Collateral and to inspect, audit, make test
verifications and otherwise check and make extracts from the books, records,
journals, orders, receipts, correspondence and other data relating to the
Collateral or to any other transactions between the parties hereto.
8(g) The Obligor agrees to stamp its books and records pertaining to
Accounts, Contracts, Chattel Paper, Instruments, Documents, Trademarks and
General Intangibles to evidence the Lender's security interest therein in form
satisfactory to the Lender immediately upon the Lender's written demand.
8(h) The Obligor will obtain the consent of any Governmental
Authority or other Person to the assignment hereunder of any of the Collateral
if such consent may be required by the terms of any contract or statute.
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8(i) If any action or proceeding shall be commenced, other than any
action to collect the Liabilities, to which action or proceeding the Lender or
any Lender is made a party and in which it becomes necessary to defend or uphold
the Lender's security interest hereunder, all costs incurred by the Lender for
the expenses of such litigation (including reasonable actual attorney fees and
expenses) shall be deemed part of the Liabilities secured hereby, which the
Obligor agrees to pay or cause to be paid.
8(j) The Obligor agrees that if any warehouse receipt or receipt in
the nature of a warehouse receipt is issued with respect to any of its
Inventory, such warehouse receipt or receipt in the nature thereof shall not be
"negotiable" (as such term is used in Section 7-104 of the UCC).
8(k) The Obligor will, at its own expense, make, execute, endorse,
acknowledge, file and/or deliver to the Lender from time to time such lists,
descriptions and designations of its Collateral, warehouse receipts, receipts in
the nature of warehouse receipts, bills of lading, documents of title, vouchers,
invoices, schedules, confirmatory assignments, conveyances, financing
statements, transfer endorsements, powers of attorney, certificates, reports and
other assurances or instruments and take such further steps relating to the
Collateral and other property or rights covered by the security interest hereby
granted, which the Lender deems appropriate or advisable to perfect, preserve or
protect its security interest in the Collateral consistent with the terms
hereunder, and the Obligor hereby authorizes the Lender to execute and file at
any time and from time to time one or more financing statements or copies
thereof or of this Security Agreement with respect to the Collateral signed only
by the Lender.
8(l) If the Obligor is not the owner of any premises where any
Equipment is located, the Obligor will use its reasonable best efforts to
furnish such consents and waivers executed by the owners of such premises as the
Lender shall request.
SECTION 9. Events of Default.
9(a) An Event of Default ("Event of Default") shall have occurred
under this Agreement upon (i) the failure by the Obligor to pay when due any
Liabilities, whether by acceleration or otherwise, (ii) the occurrence of any
event, condition or act which is defined or described as an Event of Default in
any Loan Document, or (iii) the occurrence of any event, condition or act which
pursuant to the terms of any Loan Document gives the Lender, for the benefit of
the Lender, the right to accelerate the payment of any Liabilities, regardless
of whether the Lender exercises such right.
9(b) Upon the occurrence and during the existence of an Event of
Default, the Lender shall have all of the rights, powers and remedies set forth
in the Credit Agreement, the Notes, this Agreement, the other Loan Documents and
any other instrument or other evidence of any of the Liabilities secured hereby,
together with the rights and remedies of a secured party under the Uniform
Commercial Code of the jurisdictions where the Collateral is located, and,
without limiting the foregoing, the Lender may:
(i) personally, or by agents or attorneys,
immediately retake possession of the Collateral or any part thereof,
from the Obligor or any other Person who then has possession of any
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part thereof with or without notice or process of law, and for that
purpose may enter upon the Obligor's premises where any of the
Collateral is located and remove the same and use in connection with
such removal any and all services, supplies, aids and other facilities
of the Obligor; and
(ii) instruct the obligor or obligors on any
agreement, instrument or other obligation (including, without
limitation, the Accounts and the Contracts) constituting the Collateral
to make any payment required by the terms of such instrument or
agreement directly to the Lender; and
(iii) withdraw all monies, securities and
instruments in the Company Account or any other account for application
to the Liabilities; and
(iv) sell or otherwise liquidate, or direct the
Obligor to sell or otherwise liquidate, any or all investments made in
whole or in part with the Collateral or any part thereof, and take
possession of the proceeds of any such sale or liquidation; and
(v) take possession of the Collateral or any part
thereof, by directing the Obligor in writing to deliver the same to the
Lender at any place or places designated by the Lender, in which event
the Obligor shall at its own expense
(A) forthwith cause the same to be moved to
the place or places so designated by the Lender and there
delivered to the Lender,
(B) store and keep any Collateral so
delivered to the Lender at such place or places pending further
action by the Lender as provided in Section 9(c) hereof, and
(C) while the Collateral shall be so stored
and kept, provide such guards and maintenance services as shall
be necessary to protect the same and to preserve and maintain
them in good condition;
it being understood that the Obligor's obligation so to deliver the
Collateral is of the essence of this Agreement and that, accordingly,
upon application to a court of equity having jurisdiction, the Lender
shall be entitled to a decree requiring specific performance by the
Obligor of said obligation.
9(c) Any Collateral repossessed by the Lender under or pursuant to
Section 7(k) or 9(b) and any other Collateral whether or not so repossessed by
the Lender, may be sold, leased or otherwise disposed of under one or more
contracts or as an entirety, and without the
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necessity of gathering at the place of sale the property to be sold, and in
general in such manner, at such time or times, at such place or places and on
such terms as the Lender may, in compliance with any mandatory requirements of
applicable law, determine to be commercially reasonable. Any of the Collateral
may be sold, leased or otherwise disposed of, in the condition in which the same
existed when taken by the Lender or after any overhaul or repair which the
Lender shall determine to be commercially reasonable at a public or private sale
or proceeding, or otherwise, by one or more contracts, in one or more parcels,
at the same or different times, for cash and/or credit and upon any terms, at
such places and times and to such persons as the Lender deems best, and for that
purpose the Lender may enter peaceably any premises on which the Collateral or
any part thereof may be situated and remove the same therefrom and the Obligor
will not resist or interfere with such action. If an Event of Default shall have
occurred and be continuing, the Lender may require the Obligor to assemble
and/or remove the Collateral and make it available to the Lender at a place to
be designated by the Lender which is reasonably convenient to both parties. The
Obligor hereby agrees that its address and the place or places of location of
the Collateral are places reasonably convenient to it to assemble 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, if an
applicable statute requires reasonable notice of sale or other disposition, the
Lender will send to the Obligor reasonable notice of the time and place of any
public sale or reasonable notice of the time after which any private sale or any
other disposition thereof is to be made. The Obligor agrees that requirement of
sending reasonable notice shall be met if such notice is mailed, postage
prepaid, to the Obligor at least ten (10) days before the time of the sale or
disposition. If an Event of Default shall have occurred and be continuing, the
Lender may at any time in its discretion transfer any property constituting
Collateral into its own name or that of its nominee and receive the income
thereon and hold the same as security for the Liabilities. To the extent
permitted by any law, the Lender may itself bid for and purchase the Collateral
or any item thereof offered for sale in accordance with this Section without
accountability to the Company (except to the extent of surplus money received as
provided in Section 9(f)).
9(d) The Obligor recognizes that the Collateral may not be readily
marketable and may not be marketable at all if an Event of Default has occurred.
Therefore, in order to enable the Lender to use such means as it may determine
necessary or advisable to realize upon the Collateral from time to time, the
Obligor consents that the Lender may use whatever means it may reasonably
consider necessary or advisable to sell any or all of the Collateral at any time
or times after default thereunder, including but not restricted to the giving of
an option to purchase any or all of the Collateral to any party and the
extending of credit to any purchaser of such Collateral. The Lender may sell any
or all of the Collateral or commit itself to sale without limiting the amount
sold to the amount of indebtedness secured thereby, plus costs and expenses of
collection.
9(e) The Lender may appropriate, set off and apply to the payment of
the Liabilities, any Collateral in or coming into the possession of the Lender
or its agents, without notice to the Obligor and in such manner as the Lender
may in its discretion determine.
9(f) The proceeds of any Collateral obtained pursuant to Section
2(a), 7(k) or 9(b) or disposed of pursuant to Section 9(c) shall be applied as
follows:
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(i) to the payment of any and all expenses and
fees (including reasonable actual attorneys' fees and expenses)
incurred by the Lender in obtaining, taking possession of, removing,
insuring, repairing, storing and disposing of Collateral and any and
all amounts incurred by the Lender in connection therewith;
(ii) next, any surplus then remaining to the
payment of the Liabilities in such order as the Lender may determine
(subject to any statutory requirements), and the Obligor shall remain
liable for, and shall pay on demand, any deficiency; and
(iii) after payment in full of all amounts due
under subparagraphs 9(f)(i) and 9(f)(ii) above, any surplus then
remaining shall be paid to the Obligor, subject, however, to the rights
of the holder of any then existing Lien of which the Lender has actual
notice (without investigation).
9(g) Each and every right, power and remedy hereby specifically
given to the Lender shall be in addition to every other right, power and remedy
specifically given under this Agreement or under the other Security Documents or
now or hereafter existing at law or in equity, or by statute and each and every
right, power and remedy whether specifically herein given or otherwise existing
may be exercised from time to time or simultaneously and as often and in such
order as may be deemed expedient by the Lender. All such rights, powers and
remedies shall be cumulative and the exercise or the beginning of exercise of
one shall not be deemed a waiver of the right to exercise of any other or
others. The Lender may exercise its rights with respect to Collateral without
resorting to or regard to other Collateral or sources of reimbursement for any
of the Liabilities. No delay or omission of the Lender in the exercise of any
such right, power or remedy and no renewal or extension of any of the
Liabilities shall impair any such right, power or remedy or shall be construed
to be a waiver of any Default or Event of Default or an acquiescence therein. In
the event that the Lender shall bring any suit to enforce any of its rights
hereunder and shall be entitled to judgment, then in such suit the Lender may
recover reasonable expenses, including attorneys' fees, and the amounts thereof
shall be included in such judgment.
9(h) In case the Lender shall have instituted any proceeding to
enforce any right, power or remedy under this Agreement by foreclosure, sale,
entry or otherwise, and such proceeding shall have been discontinued or
abandoned for any reason or shall have been determined adversely to the Lender,
then and in every such case the Obligor, the Lender and each holder of any of
the obligations shall be restored to their former positions and rights hereunder
with respect to the Collateral subject to the security interest created under
this Agreement, and all rights, remedies and powers of the Lender shall continue
as if no such proceeding had been instituted.
SECTION 10. Waivers.
10(a) Except as otherwise provided in this Agreement, THE OBLIGOR
HEREBY WAIVES, TO THE EXTENT PERMITTED BY APPLICABLE LAW, NOTICE
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OR JUDICIAL HEARING IN CONNECTION WITH THE LENDER'S TAKING POSSESSION OR THE
LENDER'S DISPOSITION OF ANY OF THE COLLATERAL, INCLUDING, WITHOUT LIMITATION,
ANY AND ALL PRIOR NOTICE AND HEARING FOR ANY PREJUDGMENT REMEDY OR REMEDIES AND
ANY SUCH RIGHT WHICH THE OBLIGOR WOULD OTHERWISE HAVE UNDER THE CONSTITUTION OR
ANY STATUTE OF THE UNITED STATES OR OF ANY STATE, and the Obligor hereby further
waives:
(i) all damages occasioned by such taking of
possession except any damages which are the direct result of the
Lender's gross negligence or willful misconduct;
(ii) all other requirements as to the time, place
and terms of sale or other requirements with respect to the enforcement
of the Lender's rights hereunder; and
(iii) all rights of redemption, appraisement,
valuation, stay, extension or moratorium now or hereafter in force
under any applicable law in order to prevent or delay the enforcement
of this Agreement or the absolute sale of the Collateral or any portion
thereof, and the Obligor, for itself and all who may claim under
insofar as it or they, now or hereafter, lawfully may, hereby waives
the benefit of all such laws.
Any sale of, or the grant of options to purchase, or any other realization upon,
any Collateral shall operate to divest all right, title, interest, claim and
demand, either at law or in equity, of the Obligor therein and thereto, and
shall be a perpetual bar both at law and in equity against the Obligor and
against any and all Persons claiming or attempting to claim the Collateral so
sold, optioned or realized upon, or any part thereof, from, through and under
the Obligor.
10(b) The Obligor waives demand, notice, protest, notice of
acceptance of this Agreement, notice of loans made, credit extended, Collateral
received or delivered or other action taken in reliance hereon and all other
demands and notices of any description except as hereinbefore provided. With
respect to Liabilities and Collateral, the Obligor assents to any extension or
postponement of the time of payment or any other indulgence, to any
substitution, exchange or release of Collateral, to the addition or release of
any party or person primarily or secondarily liable, to the acceptance of
partial payments thereon and the settlement, compromising or adjusting of any
thereof, all in such time or times as the Lender may deem advisable. The Obligor
waives all rules of suretyship law and any other law whatsoever which is legally
permitted to be waived and which would, if not waived, impair the Lender's
enforcement of its security interests hereunder. By way of example, but not in
limitation of the Lender's rights under this Security Agreement, subject to the
terms and conditions of this Security Agreement and the Credit Agreement, the
Lender may do any of the following without notice to the Obligor (unless such
notice or other action is otherwise required pursuant to any of the Loan
Documents to which the Obligor is a party):
(i) change, renew or extend the time for payment of all
or any part of the Liabilities;
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(ii) change any provision with respect to all or any part
of the Liabilities;
(iii) release, surrender, sell or otherwise dispose of any
money or property which is in the Lender's possession as collateral
security for the Liabilities;
(iv) fail to perfect a security interest in any property
which is pledged or mortgaged as security for payment of the
Liabilities;
(v) release or discharge any party liable to the Lender
in whole or in part for the Liabilities, or accept any additional
parties or guarantors;
(vi) delay or refrain from exercising any of the Lender's
rights;
(vii) settle or compromise any and all claims pertaining to
the Liabilities and the Collateral; and
(viii) apply any money or property of the Obligor or that of
any other party liable to the Lender for any part of the Liabilities in
any order the Obligor chooses.
10(c) The Lender shall have no duty as to the collection or
protection of Collateral not in the Lender's possession, and the Lender's duty
with reference to Collateral in its possession shall be to use reasonable care
in the custody and preservation of such Collateral, but such duty shall not
require the Lender to do any of the following (although the Lender is authorized
to reasonably undertake any such action if the Lender deems such action
appropriate):
(i) exercise any rights under the Collateral or
act upon any request made by the Obligor;
(ii) collect any sums due on the Collateral;
(iii) notify the Obligor of any maturities or other
similar matters concerning the Collateral; or
(iv) preserve or protect the Obligor's rights in
the Collateral or take any action to protect any of the Collateral
against claims of others or to preserve rights against prior parties.
SECTION 11. Indemnity and Costs and Expenses.
11(a) The Obligor agrees to pay, or reimburse the Lender for any and
all fees, costs and expenses of whatever kind or nature incurred in connection
with (i) the enforcement or attempted enforcement of the Lender's rights under
this Security Agreement, and (ii) the creation, preservation or protection of
the Lender's Liens on, and security interest in, the Collateral, including,
without limitation, all fees and taxes in connection with the recording or
filing of instruments and documents in public offices, payment or discharge of
any taxes or Liens upon or in respect of the Collateral, premiums for insurance
with respect to the Collateral and all
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other fees, costs and expenses in connection with protecting, maintaining or
preserving the Collateral and the Lender's interest therein, whether through
judicial proceedings or otherwise, or in defending or prosecuting any actions,
suits or proceedings arising out of or relating to the Collateral.
11(b) Without limiting the application of Section 11(a) hereof, the
Obligor agrees to pay, indemnify and hold the Lender (herein, the "Indemnitee")
harmless from and against any loss, costs, damages and expenses which any such
Indemnitee may suffer, expend or incur in consequence of or growing out of any
misrepresentation by the Obligor in this Agreement or any of the other Loan
Documents or in any statement or writing contemplated by or made or delivered
pursuant to or in connection with this Agreement or any of the other Security
Documents or any breach by the Obligor of this Agreement or any of the other
Loan Documents.
11(c) If and to the extent that the obligations of the Obligor under
this Section 11 are unenforceable for any reason, the Obligor hereby agrees to
make the maximum contribution to the payment and satisfaction of such
obligations which is permissible under applicable law.
11(d) Any amounts paid by any Indemnitee as to which such Indemnitee
has the right to reimbursement shall constitute Liabilities secured by the
Collateral. The indemnity obligations of the Obligor contained in this Section
11 shall continue in full force and effect notwithstanding the full payment of
all Liabilities and notwithstanding the discharge thereof.
SECTION 12. [Intentionally Omitted]
SECTION 13. Successors and Assigns. The covenants, representations,
warranties and agreements herein set forth shall be binding upon the Obligor,
its legal representatives, successors and assigns, and shall inure to the
benefit of the Lender and its successors and assigns. The successor of the
Lender hereunder shall forthwith become vested with and shall be entitled to
exercise all the powers and rights given by this Agreement to the Lender, as if
said successor were originally named as secured party herein.
SECTION 14. Lender May Perform. If Obligor fails to perform any
agreement contained herein, the Lender may itself perform, or cause performance
of, such agreement, and the expenses of the Lender incurred in connection
therewith shall be payable by Obligor on demand.
SECTION 15. No Waiver; Remedies. No failure on the part of the Lender
to exercise, and no delay in exercising, and no course of dealing with respect
to, any right, power, or remedy under this Agreement shall operate as a waiver
thereof; nor shall any single or partial exercise of any right hereunder and
under any of the other Loan Documents preclude any other or further exercise
thereof or the exercise of any other right, power, or privilege. The remedies
provided herein and in the other Loan Documents are cumulative and not exclusive
of any remedies provided by law.
SECTION 16. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE
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STATE OF NEW YORK WITHOUT REGARD TO ANY CHOICE OF LAW RULES WHICH WOULD REQUIRE
THE APPLICATION OF THE LAWS OF ANY OTHER JURISDICTION EXCEPT TO THE EXTENT THAT
THE LAWS OF THE JURISDICTIONS WHERE THE COLLATERAL IS LOCATED APPLY TO THE
CREATION, ATTACHMENT, PERFECTION, PRIORITY AND ENFORCEMENT OF LIENS ON AND
SECURITY INTERESTS IN THE COLLATERAL.
SECTION 17. Severability. If any provision hereof shall be held to be
invalid, illegal or unenforceable in any jurisdiction, then, to the fullest
extent permitted by law, (i) the other provisions hereof shall remain in full
force and effect in such jurisdiction, and (ii) the invalidity or
unenforceability of any provision hereof in any jurisdiction shall not affect
the validity or enforceability of such provision in any other jurisdiction.
SECTION 18. Amendments. None of the terms or provisions of this
Security Agreement may be waived, altered, modified, or amended except by an
agreement in writing signed by the Lender and the Obligor.
SECTION 19. Notices. All notices, statements, requests and demands
herein provided for shall be in writing and shall be deemed to have been given
or made when delivered to the respective addresses and in the manner specified
in Section 9.01 of the Credit Agreement.
SECTION 20. Counterparts. This Agreement may be executed in any number
of counterparts, all of which, when taken together shall constitute one and the
same instrument, and any party hereto may execute this Agreement by signing any
such counterpart.
SECTION 21. Termination. When all Liabilities shall have been paid in
full and the Guarantee has expired or been terminated, this Agreement shall
terminate, and the Lender shall cause to be assigned, transferred and delivered,
against receipt but without any recourse, warranty or representation whatsoever,
any remaining Collateral and money received in respect thereof, to or for the
account of the Obligor. The Lender shall also execute and deliver to the Obligor
upon such termination such UCC termination statements and such other
documentation as shall be reasonably requested as necessary by the Obligor to
effect the termination and release of the Liens on the Collateral, all at the
expense of the Obligor.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective duly authorized officers as of the date and year
first above written.
CAMINUS CORPORATION
By:
----------------------------
Name:
Title:
FLEET BANK, N.A.,
as Lender
By:
----------------------------
Name:
Title:
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