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EXHIBIT 4.3
SECURITY AGREEMENT
SECURITY AGREEMENT, dated as of March 18, 1998, between NATIONSRENT,
INC., a Delaware corporation (the "Parent") and its Subsidiaries (each a
"Borrower" and collectively, the "Borrowers"), and BANKBOSTON, N.A., a national
banking association, as administrative agent (hereinafter, in such capacity, the
"Agent") for itself and other banking institutions (hereinafter, collectively,
the "Banks"), which are or may become parties to a Revolving Credit Agreement
dated as of March 18, 1998 (as amended and in effect from time to time, the
"Credit Agreement"), among the Borrowers, the Banks, the Agent and LaSalle
National Bank, as documentation agent (the "Documentation Agent").
WHEREAS, it is a condition precedent to the Banks' making any Loans,
and the Agent's issuing Letters of Credit for the account of, to the Borrowers
under the Credit Agreement that each of the Borrowers execute and deliver to the
Agent, for the benefit of the Banks and the Agent, a security agreement in
substantially the form hereof; and
WHEREAS, each of the Borrowers wishes to grant security interests in
favor of the Agent, for the benefit of the Banks and the Agent, as herein
provided;
NOW, THEREFORE, in consideration of the promises contained herein and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto agree as follows:
1. DEFINITIONS.
All capitalized terms used herein without definitions shall have the
respective meanings provided therefor in the Credit Agreement. All terms defined
in the Uniform Commercial Code of the Commonwealth of Massachusetts and used
herein shall have the same definitions herein as specified therein. "Motor
Vehicle Equipment" shall mean all trucks, trailers, automobiles, tires and all
related equipment and accessions with respect to which any Borrower now or
hereafter has full and unencumbered title, except for Permitted Liens.
2. GRANT OF SECURITY INTEREST.
2.1. COLLATERAL GRANTED.
Each of the Borrowers hereby grants to the Agent, for the
benefit of the Banks and the Agent, to secure the payment and
performance in full of all of the Obligations, a security interest in
and so pledges and collaterally assigns to the Agent, for the benefit
of the Banks and the Agent, the following properties, assets and rights
of such Borrower, wherever located, whether now owned or hereafter
acquired or arising, and all proceeds and products thereof (all of the
same being hereinafter called the "Collateral"):
All personal and fixture property of every kind and
nature including without limitation all furniture, fixtures,
equipment (including all titled or
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registered equipment and rental equipment), raw materials,
motor vehicles, trucks, trailers, tractors, cranes, and all
related equipment, parts and accessions and additions with
respect thereto, inventory, other goods, accounts, contract
rights, rights to the payment of money, insurance refund
claims and all other insurance claims and proceeds, tort
claims, chattel paper, documents, instruments, securities and
other investment property, deposit accounts and all general
intangibles including, without limitation, all tax refund
claims, license fees, patents, patent applications,
trademarks, trademark applications, trade names, copyrights,
copyright applications, rights to xxx and recover for past
infringement of patents, trademarks and copyrights, computer
programs, computer software, engineering drawings, service
marks, customer lists, goodwill, and all licenses, permits,
agreements of any kind or nature pursuant to which such
Borrower possesses, uses or has authority to possess or use
property (whether tangible or intangible) of others or others
possess, use or have authority to possess or use property
(whether tangible or intangible) of such Borrower, and all
recorded data of any kind or nature, regardless of the medium
of recording including, without limitation, all software,
writings, plans, specifications and schematics.
2.2. DELIVERY OF INSTRUMENTS, ETC.
(a) Pursuant to the terms hereof, each of the
Borrowers has endorsed, assigned and delivered to the Agent
all negotiable or non-negotiable instruments (including
certificated securities) and chattel paper pledged by it
hereunder, together with instruments of transfer or assignment
duly executed in blank as the Agent may have specified. In the
event that any of the Borrowers shall, after the date of this
Security Agreement, acquire any other negotiable or
non-negotiable instruments (including certificated securities)
or chattel paper to be pledged by it hereunder, such Borrower
shall forthwith endorse, assign and deliver the same to the
Agent, accompanied by such instruments of transfer or
assignment duly executed in blank as the Agent may from time
to time specify. The Agent agrees with each of the Borrowers
that the Agent shall not take any actions with respect to such
instruments and chattel paper unless a Default or an Event of
Default has occurred and is continuing and the Agent has
elected to exercise its rights and remedies as contemplated by
ss.15.
(b) To the extent that any securities now or
hereafter acquired by any of the Borrowers are uncertificated
and are issued to such Borrower or its nominee directly by the
issuer thereof, such Borrower shall cause the issuer to note
on its books the security interest of the Agent in such
securities and shall cause the issuer, pursuant to an
agreement in form and substance satisfactory to the Agent, to
agree to comply with instructions from the Agent as to such
securities, without further consent of such Borrower or such
nominee. To the extent that any securities, whether
certificated or uncertificated, or other financial assets
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now or hereafter acquired by any of the Borrower are held by
such Borrower or its nominee through a securities
intermediary, such Company shall (i) cause such securities
intermediary to note on its books the security interest of the
Agent in such securities or other financial assets and to
confirm such notation promptly to the Agent and (ii), at the
request of the Agent, cause such securities intermediary,
pursuant to an agreement in form and substance satisfactory to
the Agent, to agree to comply with entitlement orders or other
instructions from the Agent as to such securities or other
financial assets, without further consent of such Borrower or
such nominee. The Agent agrees with each of the Borrowers that
the Agent shall not give any such entitlement orders or
instructions to any such issuer or securities intermediary
unless a Default or an Event of Default has occurred and is
continuing and the Agent has elected to exercise its rights
and remedies as contemplated by ss.15.
2.3. EXCLUDED COLLATERAL.
Notwithstanding the foregoing provisions of this ss.2, such
grant of security interest shall not extend to, and the term
"Collateral" shall not include, any chattel paper and general
intangibles which are now or hereafter held by any of the Borrowers as
licensee, lessee or otherwise, to the extent that (i) such chattel
paper and general intangibles are not assignable or capable of being
encumbered as a matter of law or under the terms of the license, lease
or other agreement applicable thereto (but solely to the extent that
any such restriction shall be enforceable under applicable law),
without the consent of the licensor or lessor thereof or other
applicable party thereto and (ii) such consent has not been obtained;
provided, however, that the foregoing grant of security interest shall
extend to, and the term "Collateral" shall include, (A) any and all
proceeds of such chattel paper and general intangibles to the extent
that the assignment or encumbering of such proceeds is not so
restricted and (B) upon any such licensor, lessor or other applicable
party consent with respect to any such otherwise excluded chattel paper
or general intangibles being obtained, thereafter such chattel paper or
general intangibles as well as any and all proceeds thereof that might
have theretofore have been excluded from such grant of a security
interest and the term "Collateral".
2.4. STOCK PLEDGE AGREEMENT.
Concurrently herewith the Parent is executing and delivering
to the Agent, for the benefit of the Banks and the Agent, a stock
pledge agreement pursuant to which the Parent is pledging to the Agent,
for the benefit of the Banks and the Agent, all the shares of the
capital stock of each of its Subsidiaries. Such pledge shall be
governed by the terms of such stock pledge agreement and not by the
terms of this Security Agreement.
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3. TITLE TO COLLATERAL, ETC.
Each of the Borrowers is the owner of the Collateral free from any
adverse lien, security interest or other encumbrance, except for the security
interest created by this Security Agreement and other liens permitted by the
Credit Agreement. None of the Collateral constitutes, or is the proceeds of,
"farm products" as defined in ss.9-109(3) of the Uniform Commercial Code of the
Commonwealth of Massachusetts. None of the account debtors in respect of any
accounts, chattel paper or general intangibles and none of the obligors in
respect of any instruments included in the Collateral is a governmental
authority subject to the Federal Assignment of Claims Act.
4. CONTINUOUS PERFECTION - IN GENERAL.
Each Borrower's place of business or, if more than one, chief executive
office is indicated on the Perfection Certificate delivered by each Borrower to
the Agent herewith (the "Perfection Certificates"). None of the Borrowers will
change the same, or the name, identity or corporate structure of such Borrower
in any manner, without providing at least thirty (30) days prior written notice
to the Agent. The Collateral, other than Motor Vehicle Equipment, to the extent
not delivered to the Agent pursuant to ss.2.2, except under rental arrangements
in the ordinary course of business, will be kept at those locations listed on
the Perfection Certificates and none of the Borrowers will remove the Collateral
from such locations, without providing at least thirty (30) days prior written
notice to the Agent.
5. PERFECTION - MOTOR VEHICLE EQUIPMENT.
(a) On The Closing Date. If required under ss.6.19 of the Credit
Agreement, each item of Collateral the ownership of, or title to, which is
evidenced by a motor vehicle or other certificate of title statute (the "Titled
Equipment"), the jurisdiction in which each such item of Titled Equipment is
registered or titled, and the vehicle identification number, or other
appropriate serial number relating thereto, is listed on the Schedule of Titled
Equipment (the "Titled Equipment Schedule") attached to the Perfection
Certificate delivered by each Borrower to the Agent. On the Closing Date, the
Borrowers shall either (i) deliver to the Agent properly completed applications
to note the lien of the Agent on the certificates of title with respect to each
item of Titled Equipment owned by any Borrower which will evidence the lien of
the Agent in such Titled Equipment together with the originals of each such
certificate of title and provide for payment of all filing fees with respect
thereto or (ii) make appropriate electronic application(s) to note the lien of
the Agent on certificates of title (which will evidence the lien of the Agent in
such Titled Equipment) with the appropriate state registries of motor vehicles
on behalf of the Agent and provide evidence satisfactory to the Agent that
originals of such certificates of title have been delivered to such registries
of motor vehicles and that the Borrowers have paid all filing fees relating to
such applications.
(b) Covenants of the Borrowers. Each Borrower will, at all times,
except for transfers permitted pursuant to ss.6 hereof, if required under
ss.6.19 of the Credit Agreement, (i) maintain the registration and titling of
each item of Titled Equipment in the jurisdiction
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set forth with respect thereto on the applicable Perfection Certificate and (ii)
cause the lien of the on each item of Titled Equipment to be noted on the
certificate of title relating thereto. Upon the acquisition of any additional
Titled Equipment, such Borrower or such Company shall promptly, and in any event
within ten (10) days after such acquisition, (i) cause the lien of the Agent on
such Titled Equipment to be noted on the certificate of title relating thereto
and (ii) deliver to the Agent such certificate of title (which shall evidence
the lien of the Agent thereon). The Borrowers shall cause all additional Titled
Equipment to be listed on the Titled Equipment Schedule Update delivered to the
Agent pursuant to ss.6(c) hereof. Each certificate of title relating to Titled
Equipment shall be delivered by the Borrowers to the Agent at the Agent's Head
Office, Attention: Xxxxxxx X. Xxxxxxx, Environmental Division.
6. TRANSFERS OF COLLATERAL.
(a) In General. Except (i) as otherwise permitted under the Credit
Agreement and (ii) in compliance with the terms of this ss.6, if applicable,
none of the Borrowers will sell or offer to sell or otherwise transfer the
Collateral or any interest therein.
(b) Transfers of Titled Equipment. If the Banks' liens have been
noted on titled equipment pursuant to ss.6.19 of the Credit Agreement, in
connection with any sale or other transfer of Titled Equipment permitted
pursuant to ss.7.4.2 of the Credit Agreement, the applicable Borrower shall
request the Agent to release the lien of the Agent in such Titled Equipment;
provided that the Borrowers shall not take or request or cause the Agent to
take, any action to release such lien if (i) such release of lien or transfer of
Titled Equipment would not be in compliance with the terms of this Agreement or
the other Loan Documents, or (ii) after giving effect to such sale or transfer,
a Default or Event of Default shall exist under the Credit Agreement. The
proceeds from the sale of Titled Equipment shall be applied in accordance with
ss.7.4.2 of the Credit Agreement.
(c) Revised Titled Equipment Schedule. If required pursuant to
ss.6.19 of the Credit Agreement and requested by the Majority Banks, not later
than the 15th day of each calendar month, each Borrower shall deliver to the
Agent an updated Titled Equipment Schedule, listing, as of the last day of the
immediately preceding calendar month, (i) each item of Titled Equipment owned by
such Borrower, (ii) the jurisdiction in which each such item of Titled Equipment
is registered or titled, (iii) the vehicle identification number, or other
appropriate serial number relating thereto, and (iv) each item of Titled
Equipment acquired and each item of Titled Equipment sold or otherwise
transferred during such calendar month or, in the case of the updated Titled
Equipment Schedule delivered not later than March 15, 1998, since the Closing
Date.
7. NO LIENS.
Except for the security interest herein granted and liens permitted by
the Credit Agreement, the Borrowers shall be the owner of the Collateral free
from any lien, security interest or other encumbrance, and each of the Borrowers
shall defend the same against all
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material claims and demands of all persons at any time claiming the same or any
interests therein adverse to the Agent or any of the Banks. None of the
Borrowers shall pledge, mortgage or create, or suffer to exist a security
interest in the Collateral in favor of any person other than the Agent, for the
benefit of the Banks and the Agent, except for liens permitted by the Credit
Agreement.
8. INSURANCE.
8.1. MAINTENANCE OF INSURANCE.
Each of the Borrowers will maintain with financially sound and
reputable insurers insurance with respect to its properties and
business against such casualties and contingencies as shall be in
accordance with general practices of businesses engaged in similar
activities in similar geographic areas. Such insurance shall be in such
minimum amounts that such Borrower will not be deemed a co-insurer
under applicable insurance laws, regulations and policies and otherwise
shall be in such amounts, contain such terms, be in such forms and be
for such periods as may be reasonably satisfactory to the Agent. In
addition, all such insurance covering losses over $1,000,000 shall be
payable to the Agent as loss payee under a "standard" or "New York"
loss payee clause for the benefit of the Banks and the Agent and the
Agent shall be named as additional insured on all liability insurance
policies. Without limiting the foregoing, each of the Borrowers will
(i) keep all of its physical property insured with casualty or physical
hazard insurance on an "all risks" basis, with broad form flood and
earthquake coverage and electronic data processing coverage, with a
full replacement cost endorsement and an "agreed amount" clause in an
amount equal to 100% of the full replacement cost of such property,
(ii) maintain all such workers' compensation or similar insurance as
may be required by law and (iii) maintain, in amounts and with
deductibles equal to those generally maintained by businesses engaged
in similar activities in similar geographic areas, general public
liability insurance against claims of bodily injury, death or property
damage occurring, on, in or about the properties of such Borrower;
business interruption insurance; and product liability insurance.
8.2. INSURANCE PROCEEDS.
The proceeds of any casualty insurance in respect of any
casualty loss of any of the Collateral shall, subject to the rights, if
any, of other parties with a prior interest in the property covered
thereby, (i) so long as no Default or Event of Default has occurred and
is continuing and to the extent that the amount of such proceeds is
less than $1,000,000 be disbursed to the Borrower which has suffered
such loss for direct application by such Borrower solely to the repair
or replacement of such Borrower's property so damaged or destroyed and
(ii) in all other circumstances, be held by the Agent as cash
collateral for the Obligations. Upon the occurrence of an Event of
Default, the Agent may, at its sole option, disburse from time to time
all or
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any part of such proceeds so held as cash collateral, upon such terms
and conditions as the Agent may reasonably prescribe, for direct
application by the Borrowers solely to the repair or replacement of the
Borrowers property so damaged or destroyed, or the Agent may apply all
or any part of such proceeds to the Obligations with the Total
Commitment (if not then terminated) being reduced by the amount so
applied to the Obligations.
8.3. NOTICE OF CANCELLATION, ETC.
All policies of insurance shall provide for at least thirty
(30) days prior written cancellation notice to the Agent. In the event
of failure by any of the Borrowers to provide and maintain insurance as
herein provided, the Agent may, at its option, provide such insurance
and charge the amount thereof to the Borrowers. Each of the Borrowers
shall furnish the Agent with certificates of insurance and policies
evidencing compliance with the foregoing insurance provision.
9. MAINTENANCE OF COLLATERAL; COMPLIANCE WITH LAW.
Each of the Borrowers will keep the Collateral in good order and repair
in their reasonable business judgment and will not use the same in violation of
law or any policy of insurance thereon. The Agent, or its designee, may inspect
the Collateral at any reasonable time, wherever located. Each of the Borrowers
will pay promptly when due all taxes, assessments, governmental charges and
levies upon the Collateral or incurred in connection with the use or operation
of such Collateral or incurred in connection with this Security Agreement. Each
of the Borrowers has at all times operated, and such Borrower will continue to
operate, its business in compliance with all applicable provisions of the
federal Fair Labor Standards Act, as amended, and with all applicable provisions
of federal, state and local statutes and ordinances dealing with the control,
shipment, storage or disposal of hazardous materials or substances.
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10. COLLATERAL PROTECTION EXPENSES; PRESERVATION OF COLLATERAL.
10.1. EXPENSES INCURRED BY AGENT.
In its discretion, the Agent may discharge taxes and other
encumbrances at any time levied or placed on any of the Collateral,
make repairs thereto and pay any necessary filing fees. Each of the
Borrowers agrees to reimburse the Agent on demand for any and all
expenditures so made. The Agent shall have no obligation to any of the
Borrowers to make any such expenditures, nor shall the making thereof
relieve the Borrowers of any default.
10.2. AGENT'S OBLIGATIONS AND DUTIES.
Anything herein to the contrary notwithstanding, each of the
Borrowers shall remain liable under each contract or agreement
comprised in the Collateral to be observed or performed by such
Borrower thereunder. Neither the Agent nor any Bank shall have any
obligation or liability under any such contract or agreement by reason
of or arising out of this Security Agreement or the receipt by the
Agent or any Bank of any payment relating to any of the Collateral, nor
shall the Agent or any Bank be obligated in any manner to perform any
of the obligations of such Borrower under or pursuant to any such
contract or agreement, to make inquiry as to the nature or sufficiency
of any payment received by the Agent or any Bank in respect of the
Collateral or as to the sufficiency of any performance by any party
under any such contract or agreement, 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 the Agent or to which the
Agent or any Bank may be entitled at any time or times. The Agent's
sole duty with respect to the custody, safe keeping and physical
preservation of the Collateral in its possession, under ss.9-207 of the
Uniform Commercial Code of the Commonwealth of Massachusetts or
otherwise, shall be to deal with such Collateral in the same manner as
the Agent deals with similar property for its own account and as
otherwise required by law.
11. SECURITIES AND DEPOSITS.
The Agent may at any time, at its option, transfer to itself or any
nominee any securities constituting Collateral, receive any income thereon and
hold such income as additional Collateral or apply it to the Obligations.
Whether or not any Obligations are due, the Agent may at any time xxx for,
collect, or make any settlement or compromise which it deems desirable with
respect to the Collateral. Regardless of the adequacy of Collateral or any other
security for the Obligations, any deposits or other sums at any time credited by
or due from the Agent or any Bank to any of the Borrowers may at any time be
applied to or set off against any of the Obligations.
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12. NOTIFICATION TO ACCOUNT DEBTORS AND OTHER OBLIGORS.
If an Event of Default shall have occurred and be continuing, each of
the Borrowers shall, at the request of the Agent, notify account debtors on
accounts, chattel paper and general intangibles of such Borrower and obligors on
instruments for which such Borrower is an obligee of the security interest of
the Agent in any account, chattel paper, general intangible or instrument and
that payment thereof is to be made directly to the Agent or to any financial
institution designated by the Agent as the Agent's agent therefor, and the Agent
may itself, if a Default or an Event of Default shall have occurred and be
continuing, without notice to or demand upon such Borrower, so notify account
debtors and obligors. After the making of such a request or the giving of any
such notification, each of the Borrowers shall hold any proceeds of collection
of accounts, chattel paper, general intangibles and instruments received by such
Borrower as trustee for the Agent, for the benefit of the Banks and the Agent,
without commingling the same with other funds of such Borrower and shall turn
the same over to the Agent in the identical form received, together with any
necessary endorsements or assignments. The Agent shall apply the proceeds of
collection of accounts, chattel paper, general intangibles and instruments
received by the Agent to the Obligations, such proceeds to be immediately
entered after final payment in cash or solvent credits of the items giving rise
to them.
13. FURTHER ASSURANCES.
Each of the Borrowers, at its own expense, shall do, make, execute and
deliver all such additional and further acts, things, deeds, assurances and
instruments as the Agent may reasonably require more completely to vest in and
assure to the Agent and the Banks their respective rights hereunder or in any of
the Collateral, including, without limitation, (i) executing, delivering and,
where appropriate, filing financing statements and continuation statements under
the Uniform Commercial Code, (ii) obtaining governmental and other third party
consents and approvals, including without limitation any consent of any
licensor, lessor or other applicable party referred to in ss.2.3, (iii)
obtaining waivers from mortgagees and landlords, and (iv) taking all actions
required by Sections 8-313 and 8-321 of the Uniform Commercial Code (1990) or
Sections 8-106 and 9-115 of the Uniform Commercial Code (1994), as applicable in
each relevant jurisdiction, with respect to certificated and uncertificated
securities.
14. POWER OF ATTORNEY.
14.1. APPOINTMENT AND POWERS OF AGENT.
Each of the Borrowers hereby irrevocably constitutes and
appoints the Agent and any officer or agent thereof, with full power of
substitution, as its true and lawful attorneys-in-fact with full
irrevocable power and authority in the place and stead of such Borrower
or in the Agent's own name, for the purpose of carrying out the terms
of this Security Agreement, to take any and all appropriate action and
to execute any and all documents and instruments that may be necessary
or desirable to accomplish the purposes of this Security Agreement and
hereby gives said attorneys the power
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and right, on behalf of such Borrower, without notice to or assent by
such Borrower, to do the following:
(a) upon the occurrence and during the continuance of
a Default or an Event of Default, generally to sell, transfer,
pledge, make any agreement with respect to or otherwise deal
with any of the Collateral in such manner as is consistent
with the Uniform Commercial Code of the Commonwealth of
Massachusetts and as fully and completely as though the Agent
were the absolute owner thereof for all purposes, and to do at
such Borrower's expense, at any time, or from time to time,
all acts and things which the Agent deems necessary to
protect, preserve or realize upon the Collateral and the
Agent's security interest therein, in order to effect the
intent of this Security Agreement, all as fully and
effectively as such Borrower might do, including, without
limitation, (i) the filing and prosecuting of registration and
transfer applications with the appropriate federal or local
agencies or authorities with respect to trademarks, copyrights
and patentable inventions and processes, (ii) upon written
notice to such Borrower, the exercise of voting rights with
respect to voting securities, which rights may be exercised,
if the Agent so elects, with a view to causing the liquidation
in a commercially reasonable manner of assets of the issuer of
any such securities and (iii) the execution, delivery and
recording, in connection with any sale or other disposition of
any Collateral, of the endorsements, assignments or other
instruments of conveyance or transfer with respect to such
Collateral; and
(b) to file such financing statements with respect
hereto, with or without such Borrower's signature, or a
photocopy of this Security Agreement in substitution for a
financing statement, as the Agent may deem appropriate and to
execute in such Borrower's name such financing statements and
amendments thereto and continuation statements which may
require such Borrower's signature.
14.2. RATIFICATION BY BORROWERS.
To the extent permitted by law, each of the Borrowers hereby
ratifies all that said attorneys shall lawfully do or cause to be done
by virtue hereof. This power of attorney is a power coupled with an
interest and shall be irrevocable.
14.3. NO DUTY ON AGENT.
The powers conferred on the Agent hereunder are solely to
protect the interests of the Agent and the Banks in the Collateral and
shall not impose any duty upon the Agent to exercise any such powers.
The Agent shall be accountable only for the amounts that it actually
receives as a result of the exercise of such powers and neither it nor
any of its officers, directors, employees or agents shall be
responsible
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to any of the Borrowers for any act or failure to act, except for the
Agent's own gross negligence or willful misconduct.
15. REMEDIES.
If an Event of Default shall have occurred and be continuing, the Agent
may, without notice (except as otherwise provided for in the Credit Agreement)
to or demand upon any of the Borrowers, declare this Security Agreement to be in
default, and the Agent shall thereafter have in any jurisdiction in which
enforcement hereof is sought, in addition to all other rights and remedies, the
rights and remedies of a secured party under the Uniform Commercial Code,
including, without limitation, the right to take possession of the Collateral,
and for that purpose the Agent may, so far as the Borrowers can give authority
therefor, enter upon any premises on which the Collateral may be situated and
remove the same therefrom. The Agent may in its discretion require any of the
Borrowers to assemble all or any part of the Collateral at such location or
locations within the state(s) of such Borrower's principal office(s) or at such
other locations as the Agent may designate. Unless the Collateral is perishable
or threatens to decline speedily in value or is of a type customarily sold on a
recognized market, the Agent shall give to the Borrowers at least ten (10)
Business Days prior written notice of the time and place of any public sale of
Collateral or of the time after which any private sale or any other intended
disposition is to be made. Each of the Borrowers hereby acknowledges that ten
(10) Business Days prior written notice of such sale or sales shall be
reasonable notice. In addition, each of the Borrowers waives any and all rights
that it may have to a judicial hearing in advance of the enforcement of any of
the Agent's rights hereunder, including, without limitation, its right following
an Event of Default to take immediate possession of the Collateral and to
exercise its rights with respect thereto.
16. NO WAIVER, ETC.
Each of the Borrowers waives demand, notice (except as otherwise
provided for in the Credit Agreement), protest, notice of acceptance of this
Security 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. With respect to both the Obligations and the
Collateral, each of the Borrowers assents to any extension or postponement of
the time of payment or any other indulgence, to any substitution, exchange or
release of or failure to perfect any security interest in any Collateral, to the
addition or release of any party or person primarily or secondarily liable, to
the acceptance of partial payment thereon and the settlement, compromising or
adjusting of any thereof, all in such manner and at such time or times as the
Agent may deem advisable. The Agent shall have no duty as to the collection or
protection of the Collateral or any income thereon, nor as to the preservation
of rights against prior parties, nor as to the preservation of any rights
pertaining thereto beyond the safe custody thereof as set forth in ss.10.2. The
Agent shall not be deemed to have waived any of its rights upon or under the
Obligations or the Collateral unless such waiver shall be in writing and signed
by the Agent with the consent of the
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Majority Banks. No delay or omission on the part of the Agent in exercising any
right shall operate as a waiver of such right or any other right. A waiver on
any one occasion shall not be construed as a bar to or waiver of any right on
any future occasion. All rights and remedies of the Agent with respect to the
Obligations or the Collateral, whether evidenced hereby or by any other
instrument or papers, shall be cumulative and may be exercised singularly,
alternatively, successively or concurrently at such time or at such times as the
Agent deems expedient.
17. MARSHALLING.
Neither the Agent nor any Bank shall be required to marshal any present
or future collateral security (including but not limited to this Security
Agreement and the Collateral) for, or other assurances of payment of, the
Obligations or any of them or to resort to such collateral security or other
assurances of payment in any particular order, and all of the rights of the
Agent hereunder and of the Agent or any Bank in respect of such collateral
security and other assurances of payment shall be cumulative and in addition to
all other rights, however existing or arising. To the extent that it lawfully
may, each of the Borrowers hereby agrees that it will not invoke any law
relating to the marshalling of collateral which might cause delay in or impede
the enforcement of the Agent's rights under this Security Agreement or under any
other instrument creating or evidencing any of the Obligations or under which
any of the Obligations is outstanding or by which any of the Obligations is
secured or payment thereof is otherwise assured, and, to the extent that it
lawfully may, each of the Borrowers hereby irrevocably waives the benefits of
all such laws.
18. PROCEEDS OF DISPOSITIONS; EXPENSES.
The Borrowers shall pay to the Agent on demand any and all expenses,
including reasonable attorneys' fees and disbursements, incurred or paid by the
Agent in protecting, preserving or enforcing the Agent's rights under or in
respect of any of the Obligations or any of the Collateral. After deducting all
of said expenses, the residue of any proceeds of collection or sale of the
Obligations or Collateral shall, to the extent actually received in cash, be
applied to the payment of the Obligations in such order or preference as is
provided in the Credit Agreement, proper allowance and provision being made for
any Obligations not then due. Upon the final payment and satisfaction in full of
all of the Obligations and after making any payments required by Section
9-504(1)(c) of the Uniform Commercial Code of the Commonwealth of Massachusetts,
any excess shall be returned to the Borrowers, and each of the Borrowers shall
remain liable for any deficiency in the payment of the Obligations.
19. OVERDUE AMOUNTS.
Until paid, all amounts remaining unpaid past the date on which such
amounts shall have first become due and payable by any of the Borrowers
hereunder shall be a debt secured by the Collateral and shall bear, whether
before or after judgment, interest at the rate of
13
interest for overdue principal set forth in the Credit Agreement.
20. GOVERNING LAW; CONSENT TO JURISDICTION.
THIS SECURITY AGREEMENT IS INTENDED TO TAKE EFFECT AS A SEALED
INSTRUMENT AND SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
OF THE COMMONWEALTH OF MASSACHUSETTS. Each of the Borrowers agrees that any suit
for the enforcement of this Security Agreement may be brought in the courts of
the Commonwealth of Massachusetts or any federal court sitting therein and
consents to the non-exclusive jurisdiction of such court and to service of
process in any such suit being made upon such Borrower by mail at the address
set forth in ss.19 of the Credit Agreement. Each of the Borrowers hereby waives
any objection that it may now or hereafter have to the venue of any such suit or
any such court or that such suit is brought in an inconvenient court.
21. WAIVER OF JURY TRIAL.
EACH OF THE BORROWERS WAIVES ITS RIGHT TO A JURY TRIAL WITH RESPECT TO
ANY ACTION OR CLAIM ARISING OUT OF ANY DISPUTE IN CONNECTION WITH THIS SECURITY
AGREEMENT, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THE PERFORMANCE OF ANY SUCH
RIGHTS OR OBLIGATIONS. Except as prohibited by law and absent gross negligence
and willful misconduct of the Agent or the Banks, each of the Borrowers waives
any right which it may have to claim or recover in any litigation referred to in
the preceding sentence any special, exemplary, punitive or consequential damages
or any damages other than, or in addition to, actual damages. Each of the
Borrowers (i) certifies that neither the Agent nor any Bank nor any
representative, agent or attorney of the Agent or any Bank has represented,
expressly or otherwise, that the Agent or any Bank would not, in the event of
litigation, seek to enforce the foregoing waivers and (ii) acknowledges that, in
entering into the Credit Agreement and the other Loan Documents to which the
Agent or any Bank is a party, the Agent and the Banks are relying upon, among
other things, the waivers and certifications contained in this ss.21.
22. MISCELLANEOUS.
The headings of each section of this Security Agreement are for
convenience only and shall not define or limit the provisions thereof. This
Security Agreement and all rights and obligations hereunder shall be binding
upon each of the Borrowers and its respective successors and assigns, and shall
inure to the benefit of the Agent, the Banks and their respective successors and
assigns. If any term of this Security Agreement shall be held to be invalid,
illegal or unenforceable, the validity of all other terms hereof shall in no way
be affected thereby, and this Security Agreement shall be construed and be
enforceable as if such invalid, illegal or unenforceable term had not been
included herein. Each of the Borrowers acknowledges receipt of a copy of this
Security Agreement.
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IN WITNESS WHEREOF, intending to be legally bound, each of the
Borrowers has caused this Security Agreement to be duly executed as of the date
first above written.
NATIONSRENT, INC.
SAM'S EQUIPMENT RENTAL, INC.
XXXXXXX TRAILER
MANUFACTURING CO., INC.
By: /s/ Xxxx X. Xxxxxx
---------------------------------
Xxxx X. Xxxxxx, Vice President,
NATIONSRENT OF KENTUCKY, INC.
NATIONSRENT OF OHIO, INC.
NATIONSRENT OF INDIANA, INC.
NATIONSRENT OF WEST VIRGINIA,
INC.
TITAN RENTALS, INC.
By: /s/ Xxxx X. Xxxxxx
---------------------------------
Xxxx X. Xxxxxx, President
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Accepted:
BANKBOSTON, N.A.,
as Agent
By: /s/ Xxxxxxx X. Xxxxxxx
-----------------------------------
Xxxxxxx X. Xxxxxxx, Director
