Exhibit 4.10
Security Agreement
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This Security Agreement ("Agreement") is made and entered into on this
31st day of August, 1997, by and between Xx Xxxxxxxx, ("Secured Party"), and
Xxxxx Investments Inc., a Texas Corporation ("Debtor"), as follows:
W i t n e s s e t h
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Whereas, in order to secure the payment of the Indebtedness (as
hereinafter defined), Secured Party has required that Debtor assign a
security interest in the Collateral (as hereinafter defined) to Secured
Party; and
Whereas, Debtor has deemed it to be in the best interest of Debtor to
grant a security interest in the Collateral to secure the payment and
performance of the Indebtedness;
Now, Therefore, for and in consideration of the premises, covenants
and agreements contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged
and confessed, Secured Party and Debtor agree as follows:
1. Indebtedness. The Security Interest (defined below) is herein
created to secure Debtor's note of even date herewith, by and between Debtor
as Maker, and Secured Party, as Payee, in the original principal amount of
$50,000.00, and any and all renewals and extensions thereof ("Indebtedness")
2. Agreement and Collateral. Debtor hereby grants to Secured Party a
security interest ("Security Interest") in the following property
("Collateral"), whether now owned or hereafter acquired:
All Debtor's right, title and interest in and to 50 shares of
I-Con Industries Series A Preferred Stock, together with all rights,
powers and privileges thereunto appertaining, and all proceeds
thereof.
3. Debtor's Warranties. Covenants and Further Agreements.
a. Title. Except for the interests granted herein, Debtor has,
or on acquisition will have, fee simple title to the Collateral free
from any lien, security interest, encumbrance, or claim and Debtor
will, during the term of this Agreement, at Debtor's cost, keep the
Collateral free from other liens, security interests, encumbrances or
claims, and defend any action which may affect the Security Interest
or Debtor's title to the Collateral.
b. Financing Statement. Debtor will join in executing all
financing statements and other instruments, documents, certificates
and agreements deemed necessary by Secured Party to evidence, create,
perfect or enforce the Security Interest and will pay all costs
thereof.
c. Assignment. Notwithstanding any other provision hereof,
Debtor will not process, sell, lease, or otherwise dispose of all or
part of the Collateral. Secured Party may assign or transfer all or
part of his rights in, and obligations, if any, under the
Indebtedness, the Collateral and this Agreement.
4. Rights of Debtor. Prior to the occurrence of a Default (as
hereinafter defined), Debtor may exercise any and all rights, voting and
otherwise, with respect to the Collateral. However, Debtor may not receive
any distributions and other payments made with respect to the Collateral
free from the Security Interest provided for in this Agreement.
5. Rights of Secured Party. Effective upon the occurrence of a
Default, Debtor hereby appoints secured Party as Debtor's attorney-in-fact
to do any act which Debtor is obligated by this Agreement to do, to exercise
all rights of Debtor in the Collateral, voting and otherwise, to receive all
distributions! made with respect to the Collateral, and to do all things
deemed necessary by Secured Party to perfect the Security Interest and
preserve, collect, enforce and protect the Collateral, all at Debtor's cost
and without any obligation on Secured Party so to act. Secured Party shall
not be liable for any act or omission on the part of Secured Party, his
agents or employees, except willful misconduct, nor shall Secured Party be
responsible for depreciation in value of the Collateral or for preservation
of ri9hts against prior parties. The foregoing rights and powers of Secured
Party may be exercised after default and shall be in addition to, and not a
limitation upon, any rights and powers of Secured Party given herein or by
law, custom, or otherwise.
6. Events of Default. Debtor shall be in default ("Default") under
this Agreement upon the occurrence of a default pursuant to the terms of the
Note, and Debtor's failure to cure such default within the time periods set
forth in the Note.
7. Remedies of Secured Party upon Default. When a Default occurs, and
except as may be otherwise provided in the Note, Secured Party may declare
all or a part of the Indebtedness immediately due and payable without
demand, notice of default, notice of intent to demand, notice of intent to
accelerate maturity, or notice of acceleration of maturity, and may proceed
to enforce payment of same and to exercise any and all of the rights and
remedies provided by Article 9 of the Texas Business and Commerce Code
("Code") as well as all other rights and remedies possessed by Secured Party
under this Agreement or otherwise at law or in equity. For purposes of the
notice requirements of the Code, Secured Party and Debtor agree that notice
given at least ten (10) calendar days prior to the related action hereunder
is reasonable. Secured Party shall be entitled to immediate possession of
the collateral and all books and records evidencing same and shall have
authority to enter upon any premises upon which said items may be situated
and remove same therefrom. Expenses of retaking, holding, preparing for
sale, selling, or the like, shall include without limitation, Secured
Party's reasonable attorney's fees and all such expenses shall be recovered
by Secured Party before applying the proceeds from the disposition of the
Collateral toward the Indebtedness. To the extent allowed by the Code,
Secured Party may use his discretion in applying the proceeds of any
disposition of the Collateral. All rights and remedies of Secured Party
hereunder are cumulative and may be exercised singly or concurrently. The
exercise of any right or remedy will not be a waiver of any other.
8. General.
a. Exhaustion of Remedies. Secured Party shall not be required
to first foreclose, proceed against, or exhaust any other collateral
or security for any Indebtedness or obligation of Debtor hereby
secured before pursuing any of its rights pursuant to this Agreement.
Suit may be brought to recover other collateral at the election of
Secured Party, without joinder of Debtor.
b. Release of Collateral. Secured Party may surrender, release,
exchange or alter any collateral or security for the Indebtedness
hereby secured without effecting the Security Interest created by this
Agreement, and this Agreement shall continue effective notwithstanding
any legal disability of Debtor to incur any indebtedness or obligation
incurred to Secured Party.
c. Waiver by Secured Party. No waiver by Secured Party of any
right hereunder or of any default by Debtor shall be binding upon
Secured Party unless in writing. Failure or delay by Secured Party to
exercise any right hereunder or waiver of any default shall not
operate as a waiver of any other right, of further exercise of such
right, or of any further default.
d. Parties Bound. This Agreement shall be binding upon and inure
to the benefit of the parties hereto and their respective heirs,
executors, administrators, legal representatives, successors,
receivers, trustees and assigns where permitted by this Agreement.
e. Notice. Notice shall be given or sent when mailed postage
prepaid to Debtor's address given above or to Debtor's most recent
address as shown by notice of change on file with Secured Party.
f. Modifications. This Agreement shall not be amended in any way
except by a written agreement signed by the parties hereto.
g. Severability. The unenforceability of any provision of this
agreement shall not affect the enforceability or validity of any other
provision hereof.
h. Construction. The captions herein are for convenience of
reference only and not for definiti6n or interpretation.
i. ambiguity. In event it shall be determined that there is any
ambiguity contained herein, said ambiguity shall not be construed
against either party hereto as a result of such party's preparation of
this Agreement, but, shall be interpreted in favor or against either
of the parties hereto in light of all the facts, circumstances and the
intentions of the parties at the time of their executive of this
Agreement.
j. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Texas.
Secured Party:
Xx Xxxxxxxx
By: /s/
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Debtor:
Xxxxx Investments Inc.
By: /s/
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Xx Xxxxxxxx, President
