Hyattsville, MD.
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August 20, 1999
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BB&T
SECURITY AGREEMENT
In order to secure (i) the payment of a promissory note or notes
(collectively the "Note") dated as of August 20, 1999 and executed and delivered
by Datametrics Corporation, a Delaware corporation (the "Borrower(s)"), to the
Bank in the aggregate principal sum of $1,500,000.00 payable as provided therein
(the Note and any loan agreement or other agreement executed in connection with
the loan secured hereby are incorporated herein by reference); (ii) all other
obligations and liabilities (whether direct or indirect, absolute or contingent,
primary or secondary, sole or joint and several) now existing or hereafter
arising of the Borrower to the Bank; and (iii) performance by the Borrower or
the Debtor (as hereinafter defined) of the agreements hereinafter set forth or
contained in any loan agreement or other agreement entered into in connection
with the loan (all obligations secured hereby are referred to as the "Secured
Obligations"), the Borrower, or if the Collateral (as hereinafter defined) is
not owned by the Borrower,______________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(such owner of the Collateral being hereinafter referred to as the "Debtor"),
hereby grants to BRANCH BANKING AND TRUST COMPANY (the "Bank") a security
interest in the following property including any and all additions, replacements
and substitutions of all or any part thereof (and other items of property of the
same class) whether now owned or hereafter acquired or arising and all proceeds
thereof (including insurance proceeds) (all collectively called the
"Collateral").
Collateral will be located at addresses listed below until such times
as written consent to a change of location is obtained from the Bank. If the
Collateral is or includes vehicles or goods that are mobile and ordinarily used
in more than one location, such vehicles or goods will be kept at the address
set forth below except for temporary and ordinary use in other locations. If the
Collateral is or includes Accounts. all records concerning such Accounts are
located at the address set forth below.
/_/ All Equipment, including but not limited to the following:
/_/ Equipment, more specifically described as follows: __________
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(Unless otherwise specified above, the term "Equipment" shall have the
definition given it in the Maryland Uniform Commercial Code (Annotated Code of
Maryland, Commercial Law Article ss.9-109) and shall include all accessions,
parts, attachments, tools, operating manuals, and all replacements therefor.)
/_/ Vehicles described below:
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Serial If Truck - Ton & Class
New/Used Year/Make Model/Body/Type Number If Mobile Home - #2 S/N
1.
2.
3.
4.
5.
/_/ Farm Products described below (describe all crops, livestock
and supplies that are used or produced in the farming operation and that are to
serve as security): ____________________________________________________________
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including products of the described drops or livestock in their unmanufactured
states in the Debtor's possession and any offspring of the described livestock.
(Unless otherwise specified above, "Farm Products" shall have the definition
given it in the Maryland Uniform Commercial Code (Annotated Code of Maryland,
Commercial Law Article ss.9-109).)
|X| All Accounts, including but not limited to the following:
all accounts receivable
of Debtor, wherever
located or generated,
including accounts in
New Jersey and Florida
/_/ Accounts, more specifically described below:
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________________________________________________________________________________
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(The term "Accounts" shall have the definition given it in the Maryland Uniform
Commercial Code (Annotated Code of Maryland, Commercial Law Article 59-106), no
matter how evidenced, including accounts receivable, contract rights, checks,
notes, drafts, acceptances, and other forms of obligations and receivables).
|X| All Inventory, including but not limited to the following: all inventory of
Debtor, wherever
located, including
inventory in New
Jersey and Florida
|_| Inventory, more specifically described below:
________________________________________________________________________________
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(Unless otherwise specified above, "Inventory" shall have the definition given
it in the Maryland Uniform Commercial Code (Annotated Code of Maryland,
Commercial Law Article ss.9-109).
|_| All Goods, including all furniture and fixtures, including but not
limited to the following:
|_| Goods, including furniture and fixtures, more specifically described as
follows:
________________________________________________________________________________
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(Unless otherwise specified above, "Goods" shall have the definitions given them
in the Maryland Uniform Commercial Code (Annotated Code of Maryland, Commercial
Law Article ss.9-105).
|_| All Documents, Instruments, Chattel Paper, and General Intangibles,
including but not limited to the following:
|_| Documents, Instruments, Chattel Paper, and General intangibles, more
specifically described as follows:
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(Unless otherwise specified above, "Documents," "'Instruments," "Chattel Paper,"
and "General Intangibles" shall have the definitions given them in the Maryland
Uniform Commercial Code (Titles 1 through 10 of the Commercial Law Article of
the Annotated Code of Maryland).)
Debtor warrants and agrees that:
1. USE OF COLLATERAL.-The Collateral is and will be used for o personal
|X| business |_| farming purposes
If checked here o the Collateral is being acquired with the proceeds of the
advance as evidenced by this agreement and the Note, which proceeds the Bank may
disburse directly to the seller of Collateral as shown on the Bank's records. If
acquired with such advance the Collateral was delivered to the Debtor on or
before ____________________________
2. DEBTOR'S RESIDENCE OR PLACE OF BUSINESS. Debtor's residence (or place of
business if Debtor is an organization) is 25 B Hanover Road, #305, Florham Park,
New Jersey 07932
(if the Debtor is an organization and has more than one place of business, use
the chief executive office.) The Debtor will immediately notify the Bank in
writing of any change in the Debtor's residence (or place of business).
3. Chief Executive Office. If the Collateral is a type normally used in
more than one state or includes Accounts or General Intangibles and the Debtor
has a place of business in more than one state. the Debtor's chief executive
office (if different from the address set out in item 2) is
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(No. and Street) (City or Town) (County) (State)
and the Debtor will immediately notify the Bank in writing of any change in the
Debtor's chief executive office. If certificates of title are issued or
outstanding in respect to any of the Collateral, Debtor will cause the interest
of the Bank to be properly noted thereon and will cause the certificates of
title to be delivered to the Bank.
4. FIXTURES; CROPS; TIMBER; MINERALS. If the Collateral is to be affixed to real
estate or includes crops growing or to be grown, timber to be cut, minerals or
Accounts arising from the sale of minerals, the real estate and record owner of
the real estate is described above (name of record owner not necessary if
Collateral is crops growing or to be grown). If the Collateral is affixed to
such real estate prior to the perfection of the security interest granted
hereby. Debtor, on demand of the Bank, will furnish the Bank with a disclaimer
or disclaimers of any interest in the Collateral signed by all persons having
any interest in the real estate. The Debtor will (i) notify the Bank in writing
of any intended sale, mortgage, granting of a deed of trust or conveyance of the
realty and give written notice of the terms and conditions of this Security
Agreement to any prospective purchaser, mortgagee, beneficiary of a deed of
trust or grantee of a
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conveyance of said realty and a copy of such notice to the Bank and (ii) cause a
Request for Copy of Notice providing tor notice to the Bank and satisfying the
requirements of Annotated Code of Maryland, Real Property Article ss.7-105 or
any successor provision to be filed as to each existing or future mortgage or
deed of trust.
5. ACCOUNTS. If the Collateral is or includes Accounts,
(a) each Account represents a valid and legally
enforceable indebtedness according to its terms and
as represented by its corresponding invoice and is
subject to no offsets, counterclaims, contra accounts
or any other defense of any kind and character and
will be subject to no discounts, deductions,
allowances or offsets, with an unpaid balance legally
owing in the amount set forth in the respective
invoice, which balance is not yet due;
(b) the goods or merchandise sold have been delivered to
such customers or to the carrier, or the services
have been performed for such customers, in accordance
with any contracts or purchase orders between the
Debtor and its customers;
(c) the sales or rendering of services that created the
Accounts were not in violation of any law or
governmental regulation or order;
(d) at the request of the Bank.
(i) the Debtor will keep all collections of the
Accounts separate from all other funds and
property. Such funds will be delivered to
the Bank at the time and in the form
requested by the Bank. The Bank will have
the right at any time to notify account
debtors of the Bank's security interest in
the Accounts and to request that payment of
the Accounts be made directly to the Bank.
The Bank is hereby appointed the true and
lawful attorney-in-fact of the Debtor to
receive, endorse in the name of the Debtor
and collect any and all checks made payable
to the Debtor issued in payment of the
Accounts;
(ii) all collections of the Accounts will be set
forth on itemized schedules, showing the
name of the account debtor, the amount of
each payment, and such other information as
the Bank may request;
(iii) all collections of the Accounts delivered to
the Bank (either by the Debtor or directly
by account debtors) will be deposited into a
deposit account subject to the sole control
of the Bank. The Bank will have the right at
all times and in its sole discretion to
apply all or part of the funds in such
deposit account to the payment of the
Secured Obligations;
(iv) the Debtor will furnish the Bank, at such
intervals as the Bank determines, schedules
of the Accounts in a form and substance
satisfactory to the Bank;
(v) the Debtor will deliver to the Bank copies
of all invoices and other documents relating
to the Accounts; and
(vi) the Debtor will not maintain funds received
from collections of the Accounts with any
bank other than the Bank.
(e) the Bank will have the right, at all times, to cause
verification to be made of the Accounts with the
account debtors, with or without notice being given
to the account debtors of the Bank's interest in the
Accounts, and the Bank may, during normal business
hours of the Debtor, examine the ledgers, books of
account, records and papers of the Debtor and all
evidence in support of any entry thereon, and the
Debtor agrees to produce such ledgers, books, records
and papers upon demand by the Bank.
6. DISCHARGE OF OBLIGATIONS. Debtor will pay, perform and discharge all of the
Secured Obligations as and when they become due and payable or dischargeable;
except that if the Debtor and Borrower are not the same person and Debtor is not
a guarantor, endorser or co-maker of the Note or other obligations, the Debtor
shall be liable for payment of the Note or other obligations only to the extent
of the Collateral.
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7. OWNERSHIP. Except for the security interest granted hereby, Debtor is the
owner of the Collateral free and clear of all liens, security interests and
other encumbrances except as previously disclosed to Bank and will defend the
Collateral against the claims and demands of all persons.
8. WASTE. Debtor will keep the Collateral in good order and repair, reasonable
wear and tear excepted, shall not waste or destroy or permit the waste or
destruction of the Collateral or any part thereof and shall not use the
Collateral in violation of any application statute, ordinance or policy of
insurance thereon.
9. INSPECTIONS. Debtor will permit the Bank or its representatives or agents to
inspect the Collateral at any time.
10. INSURANCE. Debtor will obtain and keep in force such insurance on the
Collateral as is normal and customary in the Debtor's business or as the Bank
may require, all in such amounts, under such forms of policies, upon such terms,
for such periods and written by such companies or underwriters as the Bank may
approve. All policies of insurance will contain long form Lender's Loss Payable
clauses in favor of the Bank, and the Debtor shall deliver the policies to the
Bank as evidence of compliance with the provisions of this paragraph. Such
policies will be noncancellable except upon thirty days prior written notice to
the Bank. It is agreed that the proceeds of all such insurance, if any loss
should occur, may be applied by the Bank to the payment of the Secured
Obligations or to the replacement of any of the Collateral damaged or destroyed,
as the Bank may elect or direct in its sole discretion. The Debtor hereby
appoints (which appointment is irrevocable as long as any of the Secured
Obligations remain outstanding) Bank as its lawful attorney-in-fact in making,
adjusting, and settling claims under and canceling such insurance and endorsing
the Debtor's name on any drafts by insurers of the collateral.
11. TAXES; ASSESSMENTS. Debtor will promptly pay when due all taxes and
assessments upon the Collateral or for its use or operation.
12. OTHER LIENS; SALE OF COLLATERAL. Debtor will not (a) permit or suffer to
remain, and will promptly discharge, any senior liens or security interests
(other than the Bank's security interest) on any of the Collateral; (b) permit
any of the Collateral to be levied upon under any legal process; (c) dispose of
any of the Collateral without the prior written consent of the Bank (provided,
however, that if the Collateral is or includes inventory, such inventory may be
sold in the ordinary course of the Debtor's business); (d) permit anything to be
done that might impair the value of any of the Collateral or the security
afforded by this agreement; or (e) permit the Collateral to become an accession
to other goods which are not Collateral.
13. FURTHER DOCUMENTS. Upon demand of the Bank, Debtor will furnish to the Bank
such further information and shall execute and deliver to the Bank such
financing statements and other papers and shall do ail such acts and things as
the Bank may at any time or from time to time request or as may be necessary or
appropriate to establish and maintain a perfected first security interest in the
Collateral as security for the Secured Obligations or to protect the Collateral,
and Debtor hereby appoints the Bank as its lawful attorney-in-fact to execute
any such documents and do such acts and things at the Bank's option upon the
Debtor's refusal to act.
14. PROTECTION OF COLLATERAL. The Bank may, in its discretion, but will not be
required to, discharge taxes, liens, security interests or other encumbrances at
any time levied or placed on the Collateral, place and pay for insurance
thereon, order and pay for the repair, maintenance and preservation thereof, and
pay any necessary filing or recording fees. Any amount so expended by the Bank
(including reasonable attorneys' fees) pursuant to the foregoing shall become
part of the Secured Obligations, shall be payable upon demand and shall bear
interest until paid at the rate applicable to the indebtedness evidenced by the
Note. Until default the Debtor may have possession of the Collateral and use the
same in any lawful manner not inconsistent with this agreement or with the terms
and conditions of any insurance policy thereon.
15. DOCUMENTS; INSTRUMENTS. If the Collateral includes documents or instruments
the Debtor has or will, at the request of the Bank, deliver the Collateral to
the Bank to be held by the Bank. The Debtor will execute any endorsement or
writing upon the documents or instruments as may be requested by the Bank in
order to evidence the pledge, assignment and transfer of such Collateral to the
Bank, and Debtor hereby appoints the Bank as its lawful attorney-in-fact to
execute any such endorsements or writings and do such acts and things at the
Bank's option upon the Debtor's
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refusal to act. If the Secured Obligations are paid in full and satisfied, the
Bank will redeliver possession of such Collateral to Debtor and will execute any
endorsements or writings reasonably necessary to transfer such Collateral back
to Debtor (without recourse).
16. DEFAULT. The occurrence of any of the following is a default under this
Agreement:
(a) Failure to pay or perform any of the Secured Obligations when
due;
(b) The falsity in any material respect when made or furnished of
any warranty, representation or statement made or furnished to
the Bank (i) by or on behalf of Debtor in connection with this
agreement (including warranties and representations contained
herein) or (ii) by and on behalf of Borrower in connection
with the Note or other agreement establishing or evidencing
the Secured Obligations;
(c) Loss, theft, substantial damage, destruction, disposition
(without prior written consent), encumbrance to or of any of
the Collateral, or the levy, seizure or attachment of any of
the Collateral;
(d) The Bank in good xxxxx xxxxx itself or the Collateral to be
insecure or unsafe;
(e) Death, dissolution, termination of existence, insolvency,
appointment of a receiver of any of the property of,
assignment for the benefit of creditors by, or the
commencement of any bankruptcy or insolvency proceeding by or
against the Debtor or Borrower or any guarantor or surety of
the Debtor or Borrower.
17. REMEDIES. Upon default the Bank, at its option, may declare all of the
Secured Obligations to be immediately due and payable and will have all the
rights arid remedies of a secured party under the Maryland Uniform Commercial
Code, including without limitation, the right to take possession of the
collateral under ss.9-503 of the Commercial Law Article of the Annotated Code of
Maryland, or other applicable law and all rights provided herein, in the Note,
or in any other applicable security or loan agreement, all of which rights and
remedies will, to the full extent permitted by law, be cumulative. The Bank may
require Debtor to assemble the Collateral and make it available to the Bank at a
place to be designated by the Bank that is reasonably convenient to the Bank and
the Debtor. The Debtor will supply additional collateral as security for the
Secured Obligations if so requested by the Bank. Any notice of sale, disposition
or other intended action by the Bank sent to the Debtor at the address of Debtor
as may from time to time be shown on the Bank's records at least 5 days prior to
such action will constitute reasonable notice to the Debtor. The Bank may
enforce any or all of its remedies against any portion of the Collateral or
against other security or borrowers without affecting its right to enforce any
or all its remedies against any or all of the Collateral or other borrowers.
18. MISCELLANEOUS. This agreement and the security interest in the Collateral
created hereby will terminate when the Secured Obligations have been paid in
full. Debtor and Borrower jointly and severally agree to pay to the Bank upon
demand all costs and expenses (including reasonable attorneys' fees) incurred in
connection with the enforcement of this agreement, and agree that all such fees
shall become part of the Secured Obligations. No waiver by the Bank of any
default will be effective unless in writing nor operate as a waiver of any other
default or of the same default on a future occasion. No failure or delay of the
Bank to exercise its remedies hereunder or take any action upon the occurrence
of a default will operate as a waiver of that default or any other default. All
rights of the Bank hereunder will inure to the benefit of its successors and
assigns, and all obligations of the Debtor will bind the heirs, legal
representatives, successors and assigns of the Debtor. If there be more than one
Debtor, their obligations hereunder will be joint and several. Invalidation of
any one or more of the provisions of this agreement will not affect any of the
other provisions hereof, which shall remain in full force and effect. This
agreement will be governed by and construed in accordance with the laws of the
State of Maryland. Captions are inserted for convenience only and in no way
limit or affect the provisions of this agreement. The terms "account debtor" and
"proceeds", as used herein, will have the same meanings as they have in the
Uniform Commercial Code as adopted in Maryland.
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WITNESS the hand and seal of the undersigned.
IF DEBTOR IS A CORPORATION:
ATTEST: ____________________ DATAMETRICS CORPORATION, a Delaware corporation
-----------------------------------------------
Name of Corporation
Title: By: /s/ Xxxxxx X. Xxxxx
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Xxxxxx X. Xxxxx, Chairman of the Board,
Title: Chief Executive Officer
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CORPORATE SEAL
By: ___________________________________________
Title: ________________________________________
IF DEBTOR IS A PARTNERSHIP, LIMITED LIABILITY COMPANY,
OF LIMITED LIABILITY PARTNERSHIP:
WITNESS:
_____________________________ __________________________
NAME OF PARTNERSHIP, LLC, OR LLP
_____________________________ By: ______________________ (SEAL)
GENERAL PARTNER OR MANAGER
_____________________________ By: ______________________ (SEAL)
GENERAL PARTNER OR MANAGER
_____________________________ By: ______________________ (SEAL)
GENERAL PARTNER OR MANAGER
By: ______________________ (SEAL)
_____________________________ GENERAL PARTNER OR MANAGER
If DEBTOR IS AN INDIVIDUAL:
WITNESS:
_____________________________ ____________________________
TYPE NAME OF DEBTOR
______________________ (SEAL)
__________________________
TYPE NAME OF DEBTOR
_____________________________ ______________________ (SEAL)
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