Exhibit 10.47
SECURITY AGREEMENT
This Agreement, dated as of February 24, 2003, is between Xxxxxxxxx & Xxxx,
Inc., a Massachusetts corporation (the "Company"), and Xxxx X. Xxxxxxx, Xx.,
Xxxxx X. Xxxxxx, Xxxx X. Xxxxxxx, Xxxxxx Xxxxx and Xxxxxx X. Xxxx (each a
"Lender", and collectively the "Lenders"). The parties agree as follows:
1. Security.
1.1. Grant of Collateral. As security for the payment and performance of
the Credit Obligations described in Section 1 of the Credit Agreement (the
"Secured Obligations"), the Company hereby creates a security interest in favor
of the Lenders and the holders from time to time of the Secured Obligations in
all of the Company's right, title and interest in and to (but none of its
obligations or liabilities with respect to) the items and types of present and
future property described below in this Section 1.1, whether now owned or
hereafter acquired:
Accounts receivable, contract rights, documents, instruments, general
intangibles, inventory, goods, equipment, patents, copyrights, trademarks,
domain names, goodwill, investment property, stock or other evidences of
ownership, chattel paper, instruments, leases, commercial tort claims,
cash, cash equivalents, deposit accounts, books, records, insurance
proceeds, dividends, all other property, assets and items of value and
proceeds and products of the foregoing (all of the above being included in
the term "Collateral").
1.2. Perfection of Collateral. Upon the Lenders' reasonable request from
time to time, the Company will, and hereby authorizes the Lenders on the
Company's behalf to, execute and deliver, and file and record in the proper
filing and recording places, all such instruments, including Uniform Commercial
Code financing statements, control statements, collateral assignments of
copyrights, trademarks, patents, cash agency agreements, documents providing for
direct collection of accounts receivable, mortgages or deeds of trust and
notations on certificates of title, and take all such other action, as the
Lenders deem reasonably necessary for perfecting or otherwise confirming to them
their security interest in the Collateral.
1.3. No Liens or Dispositions. All Collateral shall be free and clear of
any liens and restrictions on the transfer thereof, including contractual
provisions which prohibit the assignment of rights under contracts, except for
nonconsensual liens imposed by law and liens and restrictions on transfer
approved by the Lenders in writing. Except with the Lenders' consent, the
Company will not sell, lease or otherwise dispose of any of the Collateral or
modify or terminate any contracts or contractual rights included in the
Collateral, except in each case in the ordinary course of business, consistent
with past practice and on arm's length terms.
2. Right to Realize upon Collateral. Except to the extent prohibited by
applicable law that cannot be waived, this Section shall govern the Lenders'
rights to realize upon the Collateral. The provisions of this Section are in
addition to any rights and remedies available at law or in equity.
2.1. Assembly of Collateral; Receiver. The Company shall, upon the Lenders'
request, assemble the Collateral and otherwise make it available to the Lenders.
The Lenders may have a receiver appointed for all or any portion of the
Company's assets or business which constitutes the Collateral in order to
manage, protect, preserve, sell and otherwise dispose of all or any portion of
the Collateral.
2.2. Waiver. To the extent it may lawfully do so, the Company waives and
relinquishes the benefit and advantage of, and covenants not to assert against
the Lenders, any valuation, stay, appraisement, extension, redemption or similar
laws now or hereafter existing which, but for this provision, might be
applicable to the sale of any Collateral made under the judgment, order or
decree of any court, or privately under the power of sale conferred by this
Agreement, or otherwise.
2.3. Foreclosure Sale. All or any part of the Collateral may be sold for
cash or other value in any number of lots at public or private sale, without
demand, advertisement or notice; provided, however, that unless the Collateral
to be sold threatens to decline speedily in value or is of a type customarily
sold on a recognized market, the Lenders shall give the Company 10 days' prior
written notice of the time and place of any public sale, or the time after which
a private sale may be made, which notice each of the Company and the Lenders
agree to be reasonable. At any sale or sales of Collateral, the Lenders or any
of their assigns may bid for and purchase all or any part of the property and
rights so sold and may use all or any portion of the Secured Obligations owed to
the Lenders as payment for the property or rights so purchased, all without
further accountability to the Company, except for the proceeds of such sale or
sales pursuant to Section 2.4(c).
2.4. Application of Proceeds. The proceeds of all sales and collections in
respect of any Collateral or other assets of the Company, all funds collected
from the Company and any cash contained in the Collateral, the application of
which is not otherwise specifically provided for herein, shall be applied as
follows:
(a) First, to the payment of the costs and expenses of such sales
and collections, the reasonable expenses of the Lenders and the reasonable
fees and expenses of the Lenders' counsel;
(b) Second, any surplus then remaining to the payment of the Secured
Obligations in such order and manner as the Lenders may in their reasonable
discretion determine; and
(c) Third, any surplus then remaining shall be paid to the Company,
subject, however, to the rights of the holder of any then existing lien for
which the Lenders have received a proper demand for proceeds prior to
making such payment to the Company.
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3. Custody of Collateral. Except as provided by applicable law that cannot be
waived, the Lenders will have no duty as to the custody and protection of the
Collateral, the collection of any part thereof or of any income thereon or the
preservation or exercise of any rights pertaining thereto, including rights
against prior parties, except for the use of reasonable care in the custody and
physical preservation of any Collateral in its possession.
4. Reimbursement of Expenses. The Company shall promptly pay on demand all
reasonable expenses of the Lenders (including reasonable attorney fees and
expenses) in connection with the preparation of this Agreement, operations
hereunder and enforcement and collection hereof, whether before or after
bankruptcy or similar proceedings (and whether or not allowed as a claim
therein).
5. General. This Agreement shall bind and inure to the benefit of the parties
hereto and their respective successors and assigns; provided, however, that the
Company may not assign its rights or obligations hereunder. Notices shall be
furnished in writing to each party at its address appearing in Section 11 of the
Credit Agreement or as it may otherwise direct in writing actually received by
the other party. The invalidity or unenforceability of any provision hereof
shall not affect the validity or enforceability of any other provision hereof,
and any invalid or unenforceable provision shall be modified so as to be
enforceable to the maximum extent of its validity or enforceability. The
headings in this Agreement are for convenience of reference only and shall not
limit, alter or otherwise affect the meaning hereof. This Agreement constitutes
the entire understanding of the parties with respect to the subject matter
hereof and supersedes all prior and current understandings and agreements,
whether written or oral. This Agreement and all actions in connection herewith
shall be governed by and construed in accordance with the laws (other than the
conflict of laws rules) of the Commonwealth of Massachusetts, except as may be
required by the Uniform Commercial Code of other jurisdictions with respect to
matters involving the perfection of the Lender's lien on the Collateral located
in such other jurisdictions.
Terms defined in the Credit Agreement and not otherwise defined herein
are used herein with the meanings so defined. This Agreement may be executed in
two or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
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Each of the undersigned has caused this Agreement to be executed and
delivered by its duly authorized officer as an agreement under seal as of the
date first written above.
THE COMPANY:
XXXXXXXXX & XXXX, INC.
By /s/ Xxxx X. Xxxxxxxxx
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Name: Xxxx X. Xxxxxxxxx
Title: Chief Executive Officer
THE LENDERS:
/s/ Xxxx X. Xxxxxxx, Xx.
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Xxxx X. Xxxxxxx, Xx.
/s/ Xxxxx X. Xxxxxx
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Xxxxx X. Xxxxxx
/s/ Xxxx X. Xxxxxxx
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Xxxx X. Xxxxxxx
/s/ Xxxxxx Xxxxx
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Xxxxxx Xxxxx
/s/ Xxxxxx X. Xxxx
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Xxxxxx X. Xxxx
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