Form 8-K Dated February 17, 1998
Purus, Inc.
File no. 0-22408
Exhibit No. 2
SECURITY AGREEMENT
THIS SECURITY AGREEMENT (this "Agreement"), dated as of
February 17, 1998, is by and among CASA SOLAZ, INC., a Nevada
corporation with an office at 00000 Xxxxx Xxxxx, Xxxxxx Xxxx, XX
00000 ("Borrower"), and PURUS, INC., a Delaware Corporation with
an office at 000 Xxxxxxx Xxxxxx, Xxxxx X, Xxxxxx Xxxx, XX 95037-
5529 ("Lender").
WITNESSETH:
RECITALS
A. Borrower and Lender are entering into a 6% Convertible
Promissory Note dated the date hereof (the "Note"), pursuant to
which, among other things, Lender will lend $1,800,000 to
Borrower (the "Term Loan") on the terms and conditions set forth
in the Note; and
B. It is a condition precedent to Lender's obligation to
make the Term Loan that Borrower grant a continuing security
interest in and to the "Collateral" (as hereinafter defined) to
secure the "Secured Obligations" (as hereinafter defined);
NOW, THEREFORE, in consideration of the premises and other
good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as
follows:
SECTION 1. Definitions. The following terms (whether or
not underscored), when used in this Agreement, shall have the
following meanings:
"Accounts" means all "accounts" (as defined in the UCC), now
or hereafter owned or acquired by a person or in which a person
now or hereafter has or acquires any rights, and, in any event,
shall mean and include, without limitations, (a) all accounts
receivable, contract rights, book debts, notes, drafts, and other
obligations or indebtedness owing to such person arising from the
sale or lease of goods or other property by it or the performance
of services by it (including, without limitation, any such
obligation which might be characterized as an account, contract
right or general intangible under the Uniform Commercial Code in
effect in any jurisdiction), (b) all of such Person's rights in,
to and under all purchase and sales orders for goods, services or
other property, and all of such Person's rights to any goods,
services or other property represented by any of the foregoing
(including rights to any goods, services or other property
represented by any of the foregoing (including returned or
repossessed goods and unpaid sellers' rights of rescission,
replevin, reclamation and rights to stoppage in transit), (c) all
monies due to or to become due to such person under all contracts
for the sale, lease or exchange of goods or other property or the
performance of services by it (whether or not yet earned by
performance on the part of such Person) and (d) all collateral
security and guarantees of any kind given by such person with
respect to any of the foregoing, in each case whether now in
existence or hereafter arising or acquired.
"Chattel Paper" means any "chattel paper" (as defined in the
UCC) now or hereafter owned or acquired by a person or in which a
person now or hereafter has or acquires any rights.
"Collateral" means, collectively, all of the Borrower's:
(i) Accounts;
(ii) Chattel Paper;
(iii) Documents;
(iv) Instruments;
(v) Investment Property
(vi) All books and records pertaining to any of this
Collateral (including, without limitation, credit files,
printouts and other computer materials and records); and
(vii) All products and Proceeds of all or any of the
Collateral described in clauses (i) through (vi) hereof.
"Documents" means all "documents" (as defined in the UCC)
or other receipts covering, evidencing or representing goods, now
or hereafter owned or acquired by a person or in which a person
now or hereafter has or acquires rights.
"Instruments" means all "instruments" or "letters of
credit" (each defined in the UCC), including, without limitation,
instruments and letters of credit evidencing , representing,
arising from or existing in respect of, relating to, securing or
otherwise supporting the payment of, any of the Accounts,
including (but not limited to) promissory notes, drafts, bills of
exchange and trade acceptance, now or hereafter owned or acquired
by a person or in which a person now or hereafter has or acquires
any rights.
"Investment Property" means all "investment property" (as
defined in the UCC), including, without limitation, a security
(whether certificated or uncertificated), a security entitlement,
a securities account, a commodity contract, or a commodity
account, now or hereafter owned or acquired by a person or in
which a person now or hereafter has or acquires any rights.
"Perfection Certificate" means a certificate dated as of
even date herewith, setting forth the corporate names, chief
executive office or principal places of business in each state
and other current locations of the Borrower and such other
information as the Lender deems pertinent to the perfection of
security interests, completed and supplemented with the schedules
and attachments contemplated thereby to the satisfaction of the
Lender, and duly executed by the chief executive officer of the
Borrower.
"Pledge Agreement" means the Pledge Agreement of even date
herewith between Borrower as Borrower and Lender as Lender, as
the same may be amended, modified, renewed, extended or
superseded from time to time.
"Proceeds" means all proceeds of, and all other profits,
rentals or receipts, in whatever form, arising from the
collection, sale, lease, exchange, assignment, licensing or other
disposition of, or realization upon, Collateral, including,
without limitations all claims of a person against third parties
for loss of, damage to or destruction of, or for proceeds payable
under, or unearned premiums with respect to, policies of
insurance in respect of, any Collateral, and any condemnation or
requisition payments with respect to any Collateral and the
following types of property acquired with cash proceeds:
Accounts, Chattel Paper, Documents, Instruments, and Investment
Property.
"Secured Obligations" means all obligations, including,
without limitation, (a) with respect to the Borrower, (i) all
principal and interest (including, without limitation, any
interest which accrues after the commencement of any case,
proceeding or other action relating to the bankruptcy, insolvency
or reorganization of the Borrower) on the Term Loan and any other
amount due from the Borrower under, the Note, and (ii) all other
obligations (monetary or otherwise) to be performed by the
Borrower under the Note, Security Agreement or Pledge Agreement;
and (b) all renewals or extensions of any of the foregoing.
"Security Interests" means the security interests granted
pursuant to Section 3, as well as all other security interests
created or assigned as additional security for the Secured
Obligations pursuant to the provisions of this Agreement and the
Pledge Agreement.
"UCC" means the Uniform Commercial Code as in effect on the
date hereof in the state of California, provided that if by
reason of mandatory provision of law, the perfection or the
effect of perfection or non-perfection of the Security Interest
in any Collateral is governed by the Uniform Commercial Code as
in effect in a jurisdiction other than California, "UCC" means
the Uniform Commercial Code as in effect in such other
jurisdiction for purposes of the provisions hereof relating to
such perfection or effect of perfection or non-perfection.
SECTION 2. Representation and Warranties. The Borrower
represents and warrants as follows:
(a) The Borrower has good and marketable title to all of
its interest in the Collateral, free and clear of any Liens.
(b) The Borrower has not performed any act or acts that
could prevent or hinder the Lender from enforcing any of the
terms of this Agreement. No financing statement, mortgage,
security agreement or similar or equivalent document or
instrument covering all or any part of the Collateral is on file
or of record in any jurisdiction. No Collateral is in the
possession of a person (other than the Borrower) asserting any
claim thereto or security interest therein, except that the
Lender or its designee may have possession of Collateral as
contemplated hereby.
(c) All of the information set forth in the Perfection
Certificate is true and correct as of the date hereof.
(d) When the UCC financing statements in appropriate form
are filed in the offices specified in the Perfection Certificate,
the Security Interests shall constitute valid and perfected
security interests in the Collateral, prior to all other Liens
and rights of others therein.
SECTION 3. The Security Interests.
(a) In order to secure the full and punctual payment and
performance of this Secured Obligations in accordance with the
terms thereof, the Borrower hereby grants, pledges, assigns,
hypothecates, sets over and conveys to the Lender a continuing
Security Interest in and to all of the Collateral now or
hereafter owned or acquired by the Borrower or in which the
Borrower has or hereafter has or acquires any rights, and
wherever located.
(b) The Security Interests are granted as a security only
and shall not subject the Lender to, or transfer to the Lender,
or in any way affect or modify, any obligation or liability of
the Borrower with respect to any of the Collateral or any
transaction in connection therewith.
SECTION 4. Further Assurances; Covenants.
(a) General.
(i) The Borrower will not change the location, or
establish a new location, of its chief executive office or
principal place of business in any state unless it shall have (A)
given the Lender thirty (30) days prior notice thereof, (B)
executed and delivered to the Lender all financing statements and
financing statement amendments which the Lender may request in
connection therewith. The Borrower shall not change the
locations, or establish new locations, where it keeps or holds
any Collateral or any records relating thereto from the
applicable locations described in the Perfection Certificate,
unless the Borrower shall have (A) given the Lender fifteen (15)
days prior notice of such change of location, (B) executed and
delivered to the Lender all financing statements and financing
statement amendments which the Lender may request in connection
therewith and (C) complied with any other requirements in this
Agreement or any other Loan Documents relating to the location of
any Collateral. The Borrower shall not in any event change the
location, or establish a new location, of any Collateral if such
change would cause the Security Interest in such Collateral to
lapse or cease to be perfected first priority Security Interests.
(ii) The Borrower will not change its name, identify or
corporate structure in any manner unless it shall have (A) given
the Lender thirty (30) days prior notice thereof, and (B)
executed and delivered to the Lender all financing statements and
financing statement amendments which the Lender may request in
connection therewith.
(iii) The Borrower will, form time to time, at its
expense, execute, deliver, file and record any statement,
assignment, instrument, document, agreement, or other paper and
take any other action (including, without limitations, any
filings of financing or continuation statements under the UCC)
that from time to time may be necessary, or that the Lender may
request, in order to create, preserve, upgrade in rank (to the
extent required hereby), perfect, confirm or validate the
Security Interests or to enable the Lender to obtain the full
benefits of this Agreement, or to enable the Lender to exercise
and enforce any of its rights, powers and remedies hereunder with
respect to any of the Collateral. To the extent permitted by
law, the Borrower hereby authorizes the Lender to execute and
file financing statements, financing statement amendments or
continuation statements without the Borrower's signature
appearing thereon. The Borrower agrees that a carbon,
photographic, photostatic or other reproduction of this Agreement
or of a financing statement is sufficient as a financing
statement. The Borrower shall pay all costs of, or incidental
to, any recording or filing of any financing statements,
financing statement amendments or continuation statements
concerning the Collateral.
(iv) The Borrower will immediately deliver and pledge
each Instrument to the Lender, appropriately endorsed to the
Lender.
(v) The Borrower will not (A) sell, transfer, lease,
exchange, assign or otherwise dispose of, or grant any option,
warrant or other right with respect to, any Collateral except
that, subject to the rights of the Lender hereunder, if an Event
of Default shall not have occurred and be continuing, the
Borrower may dispose of assets if such disposition is permitted
by Note and Pledge Agreement, whereupon, in the case of such a
disposition, sale or exchange, the Security Interests created
hereby in such item (but not in any Proceeds arising from such
disposition, sale or exchange) shall cease immediately without
any further action on the part of the Lender; or (B) create,
incur or suffer to exist any lien with respect to any Collateral.
(vi) The Borrower will, promptly upon request, provide
to the Lender all information and evidence it may reasonably
request concerning the Collateral, and in particular the
Instruments and Investment Property, to enable the Lender to
enforce the provisions of this Agreement.
(b) Accounts, Etc.
(i) The Borrower shall use all reasonable efforts
consistent with prudent business practice to cause to be
collected from its Account debtors, as and when due, any and all
amounts owing under or on account of each Account (including,
without limitation, Accounts which are delinquent, such Accounts
to be collected in accordance with lawful collection procedures)
and apply forthwith upon receipt thereof all such amounts as are
so collected to the outstanding balance of such Account. The
costs and expenses (including, without limitation, attorney's
fees) of collection of Accounts incurred by the Borrower or the
Lender shall be borne by the Borrower.
(ii) Upon the occurrence and during the continuance of
any Even of Default, upon request of the Lender, the Borrower
will promptly notify (and the Borrower hereby authorizes the
Lender so to notify) each Account debtor in respect of any
Account or Instrument that such Collateral has been assigned to
the Lender hereunder, and that any payments due or to become due
in respect of such Collateral are to be made directly to the
Lender or its designee.
(iii) The Borrower will perform and comply with all
of its material obligations in respect of Accounts and
Instruments.
SECTION 5. Reporting and Record keeping. The Borrower
covenants and agrees with the Lender that from and after the date
of this Agreement and until the Secured Obligations have been
fully satisfied:
(a) Maintenance of Records Generally. The Borrower will
keep and maintain at its own cost and expense records of the
Collateral, complete in all material respects, including, without
limitation, a record of all payments received and all credits
granted with respect to the Collateral and all other dealings
with the Collateral. The Borrower will xxxx its books and
records pertaining to the Collateral to evidence this Agreement
and the Security Interests. All Chattel Paper will be marked
with the following legend: "This writing and the obligations
evidenced or secured hereby are subject to the security interest
of Purus, Inc." For the Lender's further security, the Borrower
agrees that the Lender shall have a security interest in all of
the Borrower's books and records pertaining to the Collateral and
upon the occurrence and during the continuation of any Default or
Event of Default, the Borrower shall deliver and turn over full
and complete copies of any such books and records to the Lender
or to its representatives at any time on demand of the Lender or
to its representatives at any time on demand of the Lender.
Subject to any government security limitations, the Borrower
shall permit the Lender or any of its representatives, during
normal business hours, to visit all of its offices, to discuss
its financial matters with its officers and independent public
accounts and to examine (and, at the expense of the Borrower,
photocopy extracts from) any of its books or other corporate
records.
(b) Special Provisions Regarding Maintenance of Records and
Reportings.
(i) The Borrower shall keep complete and accurate
records of its Accounts. At the request of the Lender the
Borrower shall deliver to the Lender a true copy of all
documents, including, without limitation, repayment histories,
present status reports relating to the Accounts and such other
matters and information relating to the status of the existing
Accounts as the Lender shall reasonably request.
(ii) The Borrower will promptly upon, but in no event
later than five (5) Business Days after:
(A) The Borrower's learning thereof, inform the
Lender, in writing, of any material delay in the Borrower's
performance of any of its material obligations to any Account
debtor and of any assertion of any material claims, offsets or
counterclaims by any Account debtor and of any allowances,
credits and/or other monies granted by the Borrower to any
Account debtor, in each case involving amounts in excess of
$5,000 for any single Account or Account debtor or in excess of
$25,000 in the aggregate for all Accounts and Account debtors;
and
(B) The Borrower's receipt or learning thereof,
furnish to an inform the Lender of all material adverse
information relating to the financial condition of any Account
debtor with respect to Accounts exceeding $5,000 individually or
$25,000 in the aggregate.
(iii) The Borrower will promptly notify the Lender
in writing if any Account, the face value of which exceeds
$5,000, arises out of a contract with the United States of
America, or any department, agency, subdivision or
instrumentality thereof, or of any state (or department, agency,
subdivision or instrumentality thereof) where such state has a
state assignment of claims act or other law comparable to the
Federal Assignment of Claims Act, and will take any action
required or requested by the Lender upon the occurrences of an
Event of Default to give notice of the Lender's security interest
in such Accounts under the provisions of the Federal Assignment
of Claims Act or any comparable law or act enacted by any state
or local governmental authority.
(c) Further Identification of Collateral. The Borrower
will furnish to the Lender, as often as the Lender reasonably
requests, statements and schedules further identifying and
describing the Collateral and such other reports in connection
with the Collateral as the Lender may reasonably request, all in
reasonable detail.
(d) Notices. In addition to the notices required by
Section 5(b) hereof, the Borrower will notify the Lender
promptly, in writing and in reasonable detail, (i) of any
material lien or claim made or asserted against any of the
Collateral, (ii) of any material adverse change in the
composition of the Collateral, and (iii) of the occurrence of any
other event which would have a material adverse effect on the
aggregate value of the Collateral or on the validity, perfection
or priority of the Security Interests.
SECTION 6. General Authority. The Borrower hereby
irrevocably appoints the Lender its true and lawful attorney,
with full power of substitution, in the name of the Borrower, the
Lender or otherwise, for the sole use and benefit of Lender, but
at the Borrower's expense, to exercise, at any time from time to
time all or any of the following powers:
(i) to file financing statements, financing statement
amendments and continuation statements referred to in Section
4(a)(iii),
(ii) to demand, xxx for, collect, receive and give
acquittance for any and all monies due or to become due with
respect to any Collateral or by virtue thereof,
(iii) to settle, compromise, compound, prosecute or
defend any action or proceeding with respect to any Collateral,
(iv) to sell, transfer, assign or otherwise deal in or
with the Collateral or the proceeds or avails thereof, as fully
and effectually as if the Lender were the absolute owner thereof,
and;
(v) to extend the time of payment of any or all
thereof and to make any allowance and other adjustments with
reference to the Collateral;
provided that the Lender shall not take any of the actions
described in this Section 6 except those described in clause (i)
above unless an Event of Default shall have occurred and be
continuing.
SECTION 7. Remedies upon Event of Default.
(a) If any Event of Default has occurred and is continuing,
the Lender may exercise without further notice, all rights and
remedies under this Agreement, the Note, or the Pledge Agreement,
all rights and remedies that are available to a secured creditor
under the UCC, and all rights and remedies that are otherwise
available at law or in equity, at any time, in any order and in
any combination, including without limitation, the collection of
any and all Secured Obligations, and, in addition, the Lender may
sell the Collateral or any part thereof at public or private
sale, for cash, upon credit or for future delivery, and upon such
terms as the Lender shall deem commercially reasonably. The
Lender shall give the Borrower not less than (10) days' prior
written notice of the time and Collateral which is perishable or
threatens to decline speedily in value or is of a type
customarily sold on a recognized market. The Borrower agrees
that any such notice constitutes "reasonable notification" within
the meaning of Section 9-504(3) of the UCC (to extent such
Section is applicable).
The Lender may be the purchaser of any or all of the
Collateral so sold at any public sale (or, if the Collateral is
of a type customarily sold in a recognized market or is of a type
customarily sold in a recognized market or is of a type which is
the subject of widely distributed standard price quotations or if
otherwise permitted under applicable law, at any private sale)
and thereafter hold the same, absolutely, free from any right or
claim whatsoever kind. The Borrower will execute and deliver
such documents and take such other action as the Lender deems
necessary or advisable in order that any such sale may be made in
compliance with the law. Upon any such sale the Lender shall
have the right to deliver, assign and transfer to the purchaser
thereof the Collateral so sold. Each purchaser at any such sale
shall hold the Collateral so sold to it absolutely, free from any
claim or right of any kind, including any equity or right of
redemption of the Borrower. To the extent permitted by law, the
Borrower hereby specifically waives all rights of redemption,
stay or appraisal which it has or may have under any law now
existing or hereafter adopted. The notice (if any) of such sale
shall (1) in case of a public sale, state the time and place
fixed for such sale, and (2) in the case of a private sale, state
the day after which such sale may be consummated. Any such
public sale shall be held at such time or times within ordinary
business hours and at such place or places as the Lender may fix
in the notice of such sale. At any such sale the Collateral may
be sold in one lot as an entirety or in separate parcels, as the
Lender may determine. The Lender shall not be obligated to make
any such sale pursuant to any such notice. The Lender may,
without notice or publication, adjourn any public or private sale
or cause the same to be adjourned from time to time by
announcement at the time and place fixed for sale, and such sale
may be made at any time or place to which the same may be so
adjourned. In case of any sale of all or any part of the
Collateral on credit or for future delivery, the Collateral so
sold may be retained by the Lender until the selling price is
paid by the purchaser thereof, but the Lender shall not incur any
liability in case of the failure of such purchaser to take up and
pay for the Collateral so sold and, in case of any such failure,
such Collateral may again be sold upon like notice. The Lender,
instead of exercising the power of sale herein conferred upon it,
may proceed by a suit or suits at law or in equity to foreclose
the Security Interests and sell the Collateral, or any portion
thereof, under a judgment or decree of a court or courts of
competent jurisdiction. The Borrower shall remain liable, for
any deficiency.
(b) For the purpose of enforcing any and all rights and
remedies under this Agreement, the Lender may (i) require the
Borrower to, and the Borrower agrees that it will, at its expense
and upon the request of the Lender, forthwith assemble all or any
part of the Collateral as directed by the Lender and make it
available at a place designated by the Lender which is, in the
Lender's opinion, convenient to the Lender and the Borrower
whether at the premises of the Borrower or otherwise, (ii) to the
extent permitted by applicable law, enter, with or without
process of law and without breach of the peace, any premise where
any of the Collateral is or may be located and, without charge or
liability to the Lender, seize and remove such Collateral from
such premises, (iii) have access to and use the Borrower's books
and records, computers and software relating the Collateral and
(iv) prior to the disposition of the Collateral, store or
transfer such Collateral without charge in or by means of any
storage or transportation facility owned or leased by the
Borrower, process, repair or recondition such Collateral or
otherwise prepare it for disposition in any manner and to the
extent the Lender deems appropriate, and in connection with such
preparation and disposition, use without charge any trademark,
trade name, and copyright by the Borrower.
SECTION 8. Limitation of Duty of Lender in Respect of
Collateral. Beyond reasonable care in custody thereof, the
Lender shall have no duty as to any Collateral in its possession
or control or in the possession or control of any agent or bailee
or any income thereon or as to the preservation of rights against
prior parties or any other rights pertaining thereto. The Lender
shall be deemed to have exercised reasonable care in the custody
of the Collateral in its possession if the Collateral is accorded
treatment substantially equal to that loss or damage to any of
the Collateral, or for any diminution in the value thereof, by
reason of the act or omission of any warehouseman, carrier,
forwarding agency, consignee or other agent or bailee selected by
the Lender in good faith.
SECTION 9. Application of Proceeds. Upon the occurrence
and during the continuance of an Event of Default, the proceeds
of any sale of, or other realization upon, all or any part of
Collateral shall be applied by the Lender in the following order
of priorities:
first, to payment of the out-of-pocket expenses of such sale
or other realization, including compensation to agents and
counsel for the Lender, and all out-of-pocket expenses,
liabilities and advances incurred or made by the Lender in
connection therewith, and any other unreimbursed expenses for
which the Lender is to be reimbursed pursuant to the Note or
Pledge Agreement.
second, to the payment of accrued but unpaid interest
(including post-petition interest) and fees constituting Secured
Obligations of the Borrower;
third, to the payment of unpaid principal of the Secured
Obligations of the Borrower;
fourth, to the payment of all other Secured Obligations of
the Borrower, until all such Secured Obligations shall have been
paid in full; and
finally, to the Borrower or its successors or assigns, or as
a court of competent jurisdiction may direct, of any surplus then
remaining from such proceeds.
The Lender may make distributions hereunder in cash or in kind
or, on a ratable basis, in any combination thereof.
SECTION 10. Expenses. In the event that the Borrower
fails to comply with the provisions of the Note, this Agreement
or the Pledge Agreement, such that the value of any Collateral or
the validity, perfection, rank or value of the Security Interests
are thereby diminished or potentially diminished or put at risk,
the Lender may, but shall not be required to, effect such
compliance on behalf of the Borrower, and the Borrower shall
reimburse the Lender for the costs thereof on demand. All
insurance expenses and all expenses of protecting, storing,
warehousing, appraising, insuring, handling, maintaining and
shipping the Collateral, any and all excise, stamp, intangibles,
transfer, property, sales, and use taxes imposed by any state,
federal, or local authority or any other governmental authority
on any of the Collateral, or in respect of periodic appraisals
and inspections of the Collateral to the extent the same may be
reasonably requested by the Lender from time to time, or in
respect of the sale or other disposition thereof, shall be borne
and paid by the Borrower; and if the Borrower fails promptly to
pay any portion thereof when due, the Lender may, at its option,
but shall not be required to, pay the same and charge the
Borrower's accounts therefor, and the Borrower agree to reimburse
the Lender therefor on demand. All sums so paid or incurred by
the Lender for any of the foregoing and any and all other sums
for which the Borrower may become liable hereunder and all costs
and expenses (including attorneys' fees, legal expenses and court
costs) incurred by the Lender in enforcing or protecting the
Security Interests or any of its rights or remedies thereon shall
be payable by the Borrower on demand and shall bear interest
(after as well as before judgment) until paid at the highest rate
then in effect under the Note.
SECTION 11. Termination of Security Interests; Release of
Collateral. Upon the performance of and repayment in full of all
Secured Obligations, the Security Interests shall terminate and
all rights to the Collateral shall revert to the Borrower. At
any time and form time to time prior to such termination of the
Security Interests, the Lender may release any of the Collateral
with the prior written consent of the Lender. Upon any such
termination of the Security Interests or release of Collateral,
the Lender will, at the expense of the Borrower, promptly execute
and deliver to the Borrower such documents as the Borrower shall
reasonably request, including but not limited to UCC-3
termination statements, to evidence the termination of the
Security Interests or the release of such Collateral, as the case
may be.
SECTION 12. Notices. Any notice required hereunder shall
be in writing and addressed to Borrower and to Lender at their
addresses set forth at the beginning of this Agreement. All such
notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered;
when received, if deposited in the mail, postage prepaid; when
transmission is verified, if telecopied; and on the next business
day, if timely delivered to an air courier guaranteeing overnight
delivery. Where this Agreement provides for notice, such notice
may be waived in writing by the person entitled to receive such
notice, either before or after the date on which the person
entitled to receive such notice and either before or after the
event, and such waiver shall be the equivalent of such notice.
SECTION 13. Waivers, Non-Exclusive 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 under the
Note, this Agreement or the Pledge Agreement shall operate as a
waiver thereof; nor shall any single or partial exercise by the
Lender of any right under the Note, this Agreement or the Pledge
Agreement preclude any other or further exercise thereof or the
exercise of any right. The rights in this Agreement, the Note
and the Pledge Agreement are cumulative and are not exclusive of
any other remedies provide by law.
SECTION 14. Successors and Assigns. This Agreement is
for the benefit of the Lender and its permitted successors and
assigns, and in the event of an assignment of all or any of the
Secured Obligations, the rights hereunder, to the extent
applicable to the indebtedness so assigned, may be transferred
with such indebtedness. This Agreement shall be binding on the
Borrower and its successors and assigns; provided, however that
the Borrower may not assign any of its rights or obligations
hereunder without the prior written consent of the Lender.
SECTION 15. Changes in Writing. Neither this Agreement
nor any provision hereof may be changed, waived, discharged or
terminated orally, but only in writing signed by the party
affected.
SECTION 16. Governing Law. THIS AGREEMENT SHALL BE DEEMED
TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF
THE STATE OF CALIFORNIA, EXCEPT TO THE EXTENT THAT PERFECTION
(AND THE EFFECT OF PERFECTION AND NONPERFECTION) AND CERTAIN
REMEDIES MAY BE GOVERNED BY THE LAWS OF ANY JURISDICTION OTHER
THAN CALIFORNIA.
SECTION 17. Severability. If any provision hereof is
invalid and 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
shall be liberally construed in favor of the Lender in order to
carry out the intentions of the parties hereto as nearly as
possible; 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. Jurisdiction. THE BORROWER HEREBY
IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY CALIFORNIA STATE
OR FEDERAL COURT IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS AGREEMENT AND THE BORROWER HEREBY IRREVOCABLY
AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING
MAY BE HEARD AND DETERMINED IN SUCH CALIFORNIA STATE OR FEDERAL
COURT. THE BORROWER HEREBY IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT IT MAY EFFECTIVELY DO SO, THE DEFENSE OF ANY INCONVENIENT
FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING.
SECTION 19. Service. The Borrower irrevocably consents
to the service of process out of any of the courts referenced in
Section 18, in any such action or proceeding by the mailing of
the copies thereof by certified mail, return receipt requested,
postage prepaid, to it at its address set forth herein, such
service to become effective upon the earlier of (i) the date 10
calendar days after such mailing or (ii) any earlier date
permitted by applicable law. Nothing in this Agreement shall
affect the right of the Lender to bring proceedings against the
Borrower in the courts of any other jurisdiction or to serve
process in any other manner permitted by applicable law.
SECTION 20 Waiver of Jury Trial. THE BORROWER AND
LENDER HEREBY KNOWINGLY, VOLUNTARILY, AND INTENTIONALLY WAIVE ANY
RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY
LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN
CONNECTION WITH, THIS AGREEMENT OR ANY COURSE OF CONDUCT, COURSE
OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN), OR ACTIONS OF
THE BORROWER OR LENDER. THIS PROVISION IS A MATERIAL INDUCEMENT
FOR THE LENDER ENTERING INTO THIS AGREEMENT AND MAKING THE TERM
LOAN TO THE BORROWER EVIDENCED BY THE NOTE.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective authorized
officers as of the day and year first above written.
CASA SOLAZ, INC.
By: /s/ Xxxxxx Xxxxxxxx, President
PURUS, INC.
By: /s/ Xxxxx Xxxxxxx, Chief Executive Officer
