EXHIBIT 10.43
AMENDED SECURITY AGREEMENT
This Amended Security Agreement is dated as of December 31, 1996
between Texas Timberjack, Inc., a Texas corporation ("Pledgor"), and Xxxxxx
Xxxxx ("Secured Party") and amends that certain Security Agreement between the
parties dated as of June 24, 1994.
WHEREAS, Secured Party has sold to Polyphase Corporation ("Polyphase")
all of the issued and outstanding capital stock of Pledgor and Polyphase gave
its Ten Million and 00/100 Dollar ($10,000,000.00) promissory note (the "Note")
as partial consideration for the purchase of such stock; and
WHEREAS, the Note has been modified, renewed and extended by
Polyphase's Eleven Million Two Hundred Thousand and 00/100 Dollar
($11,200,000.00) promissory note (the "Renewal Note"); and
WHEREAS, the Renewal Note has been modified, renewed and extended by
Polyphase's Eleven Million Eight Hundred Fifty-Five Thousand and 00/100 Dollars
($11,855,000.00) promissory note (the "$11.8 Million Renewal Note); and
WHEREAS, the $11.8 Million Renewal Note has been modified, renewed and
extended and is now evidenced by Polyphase's Twelve Million Eight Hundred Forty-
Two Thousand Nine Hundred Sixteen and 00/100 Dollars ($12,842,916.00) (the $12.8
Million Renewal Note); and
WHEREAS, as a subsidiary of Polyphase, which is a public company,
Pledgor has been able and expects in the future to be able to obtain larger
lines of credit at more attractive interest rates than previously available to
it and to receive other direct benefits as a result of being a subsidiary of
Polyphase; and
WHEREAS, as an inducement to Secured Party to extend such credit to
Polyphase, Pledgor has granted Secured Party a security interest in the property
described in the Security Agreement and Pledgor acknowledges it will receive a
direct benefit therefrom;
NOW, THEREFORE, for and in consideration of the premises and mutual
undertaking of the parties, and Ten Dollars ($10.00) and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties hereto agree as follows:
1. Section 1 of the Security Agreement is hereby amended to read in
its entirety as follows:
Secured Indebtedness - All indebtedness, obligations and
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liabilities of Polyphase to Secured Party including, but not limited
to, those under the Note, the Renewal Note, the $11.8 Million Renewal
Note and the $12.8 Million Renewal Note, whether now existing or
hereafter arising or arising under this Security Agreement or
otherwise and all renewals and extensions thereof, and all interest
accruing thereon, fees charged in connection therewith, expenses
reimbursable as provided therein, and attorney's fees incurred in the
enforcement or collection thereof, regardless of whether such
indebtedness, obligations and liabilities are direct, indirect, fixed,
contingent, joint, several or joint and several, and whether now
existing or hereafter arising and however acquired.
2. Section 4 of the Security Agreement, as amended, is amended by
adding the following:
(W) Polyphase agrees, directly or indirectly, that in the event
it sells, transfers, assigns or conveys, including by way of merger,
any interest in Overhill Foods, Inc., or if Overhill Foods, Inc. sells
or issues any securities of any type, Polyphase shall, at the closing
of such sale, transfer, assignment, conveyance, merger or other
transaction, make a payment of $9,000,000.00 on the $12.8 Million
Renewal Note.
3. Section 5 of the Security Agreement is amended by adding the
following:
(H) Polyphase shall fail to pay, when due, the $12.8 Million
Renewal Note or defaults under any agreement given as security
therefor.
4. Except as expressly provided herein, all other terms, covenants and
conditions of the Security Agreement remain in full force and effect without
modification or alteration.
Executed as of the 31st day of December, 1996.
SECURED PARTY:
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Xxxxxx Xxxxx
PLEDGOR:
TEXAS TIMBERJACK, INC.
By
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