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EXHIBIT 4.12
LOAN NO. T0310
LOAN NO. T0347
COBANK, ACB
SECURITY AGREEMENT
STATE OF LOUISIANA )
)
PARISH OF CALCASIEU )
STATE OF GEORGIA )
)
COUNTY OF XXXX )
BEFORE the respective undersigned Notaries Public, and in the presence
of the respective undersigned competent witnesses, personally came and appeared
the parties listed below, who, after being duly sworn, did state:
THIS SECURITY AGREEMENT (this "Security Agreement") is made and entered
into as of July 1, 1996, by and between MERCURY, INC. (the "Debtor") having its
place of business (or chief executive office if more than one place of
business) located at X.X. Xxx 0000, Xxxx Xxxxxxx, Xxxxxxxxx 00000 and whose
taxpayer identification number is 00-0000000, and COBANK, ACB (the "Secured
Party"), whose mailing address is 000 Xxxxxxxx Xxxxxxx, Xxxxx 0000, Xxxxxxx,
Xxxxxxx 00000.
SECTION 1. GRANT OF SECURITY INTEREST. For valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Debtor hereby
grants to the Secured Party a security interest in all of the following
property, wherever located and whether now existing or hereafter acquired,
together with all accessions and additions thereto, and all products and
proceeds thereof:
accounts; inventory (including, without limitation, returned or
repossessed goods); chattel paper; instruments (including, without
limitation, certificated securities); letters of credit; contracts and
contract rights; leases; documents; equipment (including, without
limitation, telecommunications and radio transmitting and receiving
equipment, antennae, towers, microwave communication equipment,
machinery, computers, parts, tools, implements, poles, posts,
cross-arms, conduits, ducts, lines (whether underground or overhead or
otherwise), wires, cables, exchanges, switches
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(including, without limitation, host switches and remote switches),
desks, testboards, racks, frames, motors, generators, batteries, items
of central office equipment, pay-stations, protectors, subscriber
equipment, instruments, connections and appliances, office furniture and
equipment and work equipment and any and all other equipment used,
useful or acquired for use in the business of the Debtor or the
operation of the Debtor's properties); fixtures; general intangibles
(including, without limitation, permits, licenses, grants, franchises,
privileges, permissions, certificates and choses or things in action,
litigation rights and resulting judgments, goodwill, patents, trademarks
and other intellectual property, tax refunds, miscellaneous rights to
payment, entitlements, uncertificated investment securities and
investments, margin accounts, computer programs, invoices, books,
records and other information relating to or arising out of the Debtor's
business, and, to the extent permitted by law, all licenses and permits
issued by the Federal Communications Commission (the "FCC")); and, to
the extent not covered by the above, all other personal property of, the
Debtor of every type and description, including, without limitation,
interests or claims in or under any policy of insurance, tort claims,
deposit accounts, money, and judgments; provided, however, that no
security interest is granted in licenses, permits, leases, franchises,
privileges, permissions and grants which by their terms or by reason of
applicable law would become void or voidable if a security interest
therein were granted or if the granting of a security interest therein
would violate any law, rule, regulation or order of any governmental
body or regulatory authority (collectively, the "Collateral").
Where applicable, all terms used herein shall have the same meaning as set
forth in the Uniform Commercial Code as codified at Title 10 of the Louisiana
Revised Statutes Annotated, as amended (the "UCC").
SECTION 2. OBLIGATIONS. The security interest granted hereunder shall
secure the following obligations (the "Obligations"): (a) all payments or
performances to be made by CTC Financial, Inc. (the "Borrower") under the "Loan
Documents" (as defined in that certain Amended and Restated Loan Agreement,
dated as of May 15, 1996, between the Borrower and CoBank, as amended by that
certain First Amendment and Supplement to Amended and Restated Loan Agreement,
dated as of July 1, 1996 (as so amended and as amended, modified, restated and
replaced from time to time, the "Mississippi One Loan Agreement")), including,
without limitation, the payment of all principal, interest and other amounts
becoming due and payable, whether by acceleration or otherwise, under that
certain Second Amended and Restated Promissory Note, dated July 1, 1996 (the
"Amended CoBank Note"), made by the Borrower to CoBank in the principal face
amount of $32,400,000 (as any such Loan Documents may be amended, supplemented,
modified, extended or restated from time to time); (b) all payments or
performances to be made by Mississippi One Cellular Telephone Company ("MCTC")
under the "Loan Documents" (as defined in the Mississippi One Loan Agreement
and that certain Loan Agreement, between the Borrower and
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Loan Xx. X0000
Xxxx Xx. X0000
XxXxxx, dated as of May 15, 1996 (as amended, modified, restated and replaced
from time to time, the "Mercury Loan Agreement"; the Mississippi Loan Agreement
and the Mercury Loan Agreement, the "Loan Agreements")), including, without
limitation, the payment of all principal, interest and other amounts becoming
due and payable, whether by acceleration or otherwise, under that certain
Second Amended and Restated Promissory Note, dated July 1, 1996 (the
"Mississippi One Note"), made by Mississippi One to the order of the Borrower,
and assigned to CoBank, in the face principal amount of $32,400,000, and all
payments or performances under that certain Amended and Restated Continuing
Guaranty, dated as of May 15, 1996, made by Mississippi One for the benefit of
CoBank, as amended by that certain First Amendment and Supplement to Amended
and Restated Continuing Guaranty, dated as of July 1, 1996 (as so amended and
as any such Loan Documents may be amended, supplemented, modified, extended or
restated from time to time); (c) all payments or performances to be made by the
Borrower under the "Loan Documents" (as defined in the Mercury Loan Agreement),
including, without limitation, the payment of all principal, interest and other
amounts becoming due and payable, whether by acceleration or otherwise, under
that certain Promissory Note, dated May 15, 1996 (the "CoBank Note"), made by
the Borrower to CoBank in the principal face amount of $5,000,000 (as any such
Loan Documents may be amended, supplemented, modified, extended or restated
from time to time); (d) all payments or performances to be made by the Debtor
under the "Loan Documents" (as defined in the Mercury Loan Agreement and in the
Mississippi One Loan Agreement), including, without limitation, the payment of
all principal, interest and other amounts becoming due and payable, whether by
acceleration or otherwise, under that certain Promissory Note, dated May 15,
1996 (the "Mercury Note"; the Amended CoBank Note, the Mississippi One Note,
the CoBank Note and the Mercury Note collectively, the "Notes" and, each a
"Note"), made by the Debtor to the order of the Borrower, and assigned to
CoBank, in the face principal amount of $5,000,000 (as such Promissory Note may
be amended, modified, extended, renewed, reinstated or replaced from time to
time), and all payments or performances under that certain Continuing Guaranty,
dated as of May 15, 1996, made by the Debtor for the benefit of CoBank, as
amended by that certain First Amendment and Supplement to Continuing Guaranty
(as so amended and as amended, modified, restated and replaced from time to
time, the "Mercury Guaranty"), dated as of July 1, 1996 (as any such Loan
Documents may be amended, supplemented, modified, extended or restated from
time to time); and (e) all other indebtedness and liabilities of the Debtor,
the Borrower or Mississippi One to CoBank of every kind and description
whatsoever, whether now existing or hereafter arising, fixed or contingent, as
primary obligor or as guarantor or surety, acquired directly or by assignment
or otherwise, liquidated or unliquidated, regardless of how they arise or by
what agreement or instrument they may be evidenced, including, without
limitation, all loans, advances and other extensions of credit and all
covenants, agreements and provisions contained in all loan and other agreements
between the parties.
SECTION 3. REPRESENTATIONS, WARRANTIES AND COVENANTS. The Debtor
represents, warrants and covenants as follows:
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(A) OWNERSHIP OF COLLATERAL. Except for any security interest
in favor of the Debtor owns and possesses all of the Collateral free and clear
of all adverse claims, interests, liens, encumbrances, or other defects.
Without the prior written consent of the Secured Party, the Debtor shall not
create or permit the existence of any adverse claim, interest, lien, or other
encumbrance against any of the Collateral, except as expressly permitted by the
Loan Documents. The Debtor shall provide prompt written notice to the Secured
Party upon learning of any future adverse claim, interest, lien, or encumbrance
against any of the Collateral, and shall defend diligently the Debtor's and the
Secured Party's interests in the Collateral.
(B) VALIDITY OF SECURITY AGREEMENT; CORPORATE AUTHORITY. This
Security Agreement is the legal, valid and binding obligation of the Debtor,
enforceable in accordance with its terms, subject only to limitations on
enforceability imposed (i) by applicable bankruptcy, insolvency,
reorganization, moratorium, or similar laws affecting creditors' rights
generally and (ii) by general equitable principles. The Debtor has the
corporate power to execute, deliver and carry out the terms and provisions of
this Security Agreement and all related documents, and has taken all necessary
corporate action to authorize the execution, delivery and performance of this
Security Agreement and all related documents.
(C) LOCATION OF THE DEBTOR. The Debtor's place of business
(or chief executive office if more than one place of business) is located at
the address shown above.
(D) LOCATION OF COLLATERAL. All equipment and inventory are
now at the location or locations specified on Schedule A attached hereto and
made a part hereof and except as otherwise disclosed to the Secured Party on
said Schedule A, the Debtor has not maintained any other location or locations
of inventory and equipment within the past 5 years.
(E) NAME, IDENTITY, AND CORPORATE STRUCTURE. Except as
otherwise disclosed to the Secured Party on Schedule A, the Debtor has not
within the past 10 years changed its name, identity or corporate structure
through incorporation, merger, consolidation, joint venture or otherwise.
(F) CHANGE IN NAME, LOCATION OF COLLATERAL, ETC. Without
giving at least 30 days' prior written notice to the Secured Party, the Debtor
shall not change its name, identity or corporate structure, the location of its
place of business (or chief executive office if more than one place of
business), or the location of the Collateral.
(G) FURTHER ASSURANCES. Upon the request of the Secured Party,
the Debtor shall do all acts and things as the Secured Party may from time to
time deem necessary or advisable to enable it to perfect, maintain, and continue
the perfection and priority of the security interest of the Secured Party in the
Collateral, or to facilitate the exercise by the Secured Party of any rights or
remedies granted to the Secured Party hereunder or provided by law. Without
limiting the foregoing,
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the Debtor agrees to execute, in form and substance satisfactory to the Secured
Party, such financing statements, amendments thereto, supplemental agreements,
assignments, notices of assignments, and other instruments and documents as the
Secured Party may from time to time request. In addition, in the event the
Collateral or any part thereof consists of instruments, documents, chattel
paper, or money (whether or not proceeds of the Collateral), the Debtor shall,
upon the request of the Secured Party, deliver possession thereof to the
Secured Party (or to an agent of the Secured Party retained for that purpose),
together with any appropriate endorsements and/or assignments. Without
limiting the generality of the foregoing, the Debtor shall take such action as
the Secured Party may request from time to time to create and perfect a
security interest in favor of the Secured Party in any and all leases, licenses
and permits relating to the location of antennae and other transmission and
receiving equipment on the towers or other property of third parties,
including, without limitation, amending such leases, licenses or permits to
allow the creation and perfection of such security interest and obtaining the
consent of all third parties whose consents may be necessary to the creation
and perfection of such security interest. The Secured Party shall use
reasonable care in the custody and preservation of such Collateral in its
possession, but shall not be required to take any steps necessary to preserve
rights against prior parties. All costs and expenses incurred by the Secured
Party to establish, perfect, maintain, determine the priority of, or release
the security interest granted hereunder (including the cost of all filings,
recordings, and taxes thereon and the reasonable fees and expenses of any agent
retained by the Secured Party) shall become part of the Obligations secured
hereby and be paid by the Debtor on demand.
(H) INSURANCE. The Debtor shall maintain such property and
casualty insurance with such insurance companies, in such amounts, and covering
such risks, as are at all times reasonably satisfactory to the Secured Party.
All such policies shall provide for loss payable clauses or endorsements in
form and content acceptable to the Secured Party. Upon the request of the
Secured Party, all policies (or such other proof of compliance with this
Section as may be satisfactory to the Secured Party) shall be delivered to the
Secured Party. The Debtor shall pay all insurance premiums when due. In the
event of loss, damage, or injury to any insured Collateral, the Secured Party
shall have full power to collect any and all insurance proceeds due under any
of such policies, and shall apply such proceeds to the repair or replacement of
such Collateral or, if such Collateral is not repairable or replaceable, to the
payment of any of the Obligations secured hereby.
(I) TAXES, LEVIES, ETC. The Debtor has paid and shall
continue to pay when due all taxes, levies, assessments, or other charges which
may become an enforceable lien against the Collateral, except such taxes,
levies, assessments, or other charges contested by the Debtor in good faith and
diligently prosecuted and for which reasonable reserves have been set aside on
the books of the Debtor.
(J) DISPOSITION AND USE OF COLLATERAL BY THE DEBTOR. Without
the prior written consent of the Secured Party, the Debtor shall not at any
time sell, transfer, lease, abandon, or otherwise dispose of any Collateral
other than in accordance with the provisions of the Mercury
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Guaranty; provided, however, that no such dispositions shall be made if an
Event of Default (as defined in Section 4) shall have occurred and be
continuing. The Debtor shall not use any of the Collateral in any manner which
violates any statute, regulation, ordinance, rule, decree, order, or insurance
policy.
(K) RECEIVABLES. The Debtor shall preserve, enforce, and
collect all accounts, chattel paper, instruments, documents and general
intangibles, whether now owned or hereafter acquired or arising (the
"Receivables"), in a commercially reasonable fashion and, if an Event of
Default shall have occurred, upon the request of the Secured Party, the Debtor
shall execute an agreement in form and substance satisfactory to the Secured
Party by which the Debtor shall direct all account debtors and obligors on
instruments to make payment to a lock box deposit account under the exclusive
control of the Secured Party.
(L) CONDITION OF COLLATERAL. All tangible Collateral is now
in good repair and condition and the Debtor shall at all times hereafter, at
its own expense, maintain all such Collateral in good repair and condition,
ordinary wear and tear excepted.
(M) CONDITION OF BOOKS AND RECORDS. The Debtor has maintained
and shall maintain complete, accurate and up-to-date books, records, accounts,
and other information relating to all Collateral in the present form and
detail, and shall allow the Secured Party or its representatives to examine and
copy such books, records, accounts, and other information at any reasonable
time, upon reasonable notice from the Secured Party.
(N) RIGHT OF INSPECTION. At all reasonable times and upon
reasonable notice from the Secured Party, the Debtor shall allow the Secured
Party or its representatives to visit any of the Debtor's properties or
locations so that the Secured Party or its representatives may confirm, inspect
and appraise any of the Collateral.
(O) PLEDGE OF STOCK. Upon the acquisition of capital stock of
any subsidiary, the Debtor shall execute and deliver to the Secured Party a
stock pledge agreement in form and substance satisfactory to the Secured Party,
pursuant to which the Debtor shall pledge, on a first-priority basis, all of
its stock in such subsidiary and shall covenant and agree to pledge to the
Secured Party, on a first-priority basis, all capital stock it may thereafter
acquire in that or any other subsidiary.
SECTION 4. DEFAULT. The occurrence of an event of default under any of
the Loan Documents (including, without limitation, the Loan Agreements, the
Notes and the Mercury Guaranty), the breach of or failure to perform any
covenant or agreement contained in this Security Agreement, or any material
inaccuracy as of the date made in any representation or warranty contained in
this Security Agreement shall constitute an "Event of Default" hereunder;
provided that the Debtor shall have 30 days after notice from the Secured Party
to cure any breach of the covenants set forth in Sections 3(H), (K), (L), (M),
and (N).
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SECTION 5. RIGHTS AND REMEDIES. Upon the occurrence of any Event of
Default and at any time during the continuance thereof, the Secured Party may
declare all Obligations to be immediately due and payable and, to the extent
permitted by applicable law and subject to any necessary approval of the
Federal Communications Commission relating to the exercise of remedies
hereunder involving any transfer, sale or disposition of the Debtor's assets,
may exercise any and all rights and remedies of the Secured Party in the
enforcement of its security interest under the UCC, this Security Agreement
(including, without limitation, Section 7), or any other applicable law.
Without limiting the foregoing:
(A) DISPOSITION OF COLLATERAL. The Secured Party may sell,
lease, or otherwise dispose of all or any part of the Collateral, in its then
present condition or following any commercially reasonable preparation or
processing thereof, whether by public or private sale or at any brokers' board,
in lots or in bulk, for cash, on credit or otherwise, with or without
representations or warranties, and upon such other terms as may be acceptable
to the Secured Party, and the Secured Party may purchase such Collateral at any
public sale. At any time when advance notice of sale is required, the Debtor
agrees that 10 days' prior written notice shall be reasonable. In connection
with the foregoing, the Secured Party may:
(1) require the Debtor to assemble the Collateral and all
records pertaining thereto and make such Collateral and records
available to the Secured Party at a place to be designated by the
Secured Party which is reasonably convenient to both parties;
(2) enter the premises of the Debtor or premises under the
Debtor's control and take possession of the Collateral;
(3) without charge by the Debtor, use or occupy the premises
of the Debtor or premises under the Debtor's control, including, without
limitation, warehouse and other storage facilities;
(4) without charge by the Debtor, use any patent, trademark,
trade name, or other intellectual property or technical process used by
the Debtor in connection with any of the Collateral, provided, however,
that any use of federally registered trademarks as to any goods shall be
subject to the control as to the quality of such goods of the owner of
such trademarks and the goodwill of the business symbolized thereby; and
(5) rely conclusively upon the advice or instructions of any
one or more brokers or other experts selected by the Secured Party to
determine the method or manner of disposition of any of the Collateral
and, in such event, any disposition of the Collateral by the Secured
Party in accordance with such advice or instructions shall be deemed to
be commercially reasonable.
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(B) COLLECTION OF RECEIVABLES. The Secured Party may, but
shall not be obligated to, take all actions reasonable or necessary to
preserve, enforce or collect the Receivables, including, without limitation,
the right to notify account debtors and obligors on instruments to make direct
payment to the Secured Party, to permit any extension, compromise, or
settlement of any of the Receivables for less than face value, or to xxx on any
Receivable, all without prior notice to the Debtor.
(C) PROCEEDS. The Secured Party may collect and apply all
proceeds of the Collateral, and may endorse the name of the Debtor in favor of
the Secured Party on any and all checks, drafts, money orders, notes,
acceptances, or other instruments of the same or a different nature,
constituting, evidencing, or relating to the Collateral. The Secured Party may
receive and open all mail addressed to the Debtor and remove therefrom any cash
or non-cash items of payment constituting proceeds of the Collateral.
(D) INSURANCE ADJUSTMENTS. The Secured Party may adjust and
settle any and all insurance covering any Collateral, endorse the name of the
Debtor on any and all checks or drafts drawn by any insurer, whether
representing payment for a loss or a return of unearned premium, and execute
any and all proofs of claim and other documents or instruments of every kind
required by any insurer in connection with any payment by such insurer.
The net proceeds of any disposition of the Collateral shall be applied by the
Secured Party, after deducting its reasonable expenses incurred in such
disposition, to the payment in whole or in part of the Obligations in such
order as the Secured Party may elect. The enumeration of the foregoing rights
and remedies is not intended to be exhaustive, and the exercise of any right
and/or remedy shall not preclude the exercise of any other rights or remedies,
all of which are cumulative and non-exclusive.
SECTION 6. OTHER PROVISIONS.
(A) AMENDMENT, MODIFICATION, AND WAIVER. Without the prior
written consent of the Secured Party, no amendment, modification, or waiver of,
or consent to any departure by the Debtor from, any provision hereunder shall
be effective. Any such amendment, modification, waiver, or consent shall be
effective only in the specific instance and for the specific purpose for which
given. No delay or failure by the Secured Party to exercise any remedy
hereunder shall be deemed a waiver thereof or of any other remedy hereunder. A
waiver on any one occasion shall not be construed as a bar to or waiver of any
remedy on any subsequent occasion.
(B) COSTS AND ATTORNEYS' FEES. Except as prohibited by law,
if at any time the Secured Party employs counsel in connection with the
creation, perfection, preservation, or release of the Secured Party's security
interest in the Collateral or the enforcement of any of the Secured Party's
rights or remedies hereunder, all of the Secured Party's reasonable attorneys'
fees arising from
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such services and all expenses, costs, or charges relating thereto shall become
part of the Obligations secured hereby and be paid by the Debtor on demand.
(C) REVIVAL OF OBLIGATIONS. To the extent the Debtor or any
third party makes a payment or payments to the Secured Party or the Secured
Party enforces its security interest or exercises any right of setoff, and such
payment or payments or the proceeds thereof are subsequently invalidated,
declared to be fraudulent or preferential, set aside, and/or required to be
repaid to a trustee, receiver, or any other party under any bankruptcy,
insolvency or other law or in equity, then, to the extent of such recovery, the
Obligations or any part thereof originally intended to be satisfied shall be
revived and continued in full force and effect as if such payment or payments
had not been made, or such enforcement or setoff had not occurred.
(D) PERFORMANCE BY THE SECURED PARTY. In the event the Debtor
shall at any time fail to pay or perform punctually any of its duties hereunder
within any grace period provided therefor, the Secured Party may, at its option
and without notice to or demand upon the Debtor, without obligation and without
waiving or diminishing any of its other rights or remedies hereunder, fully
perform or discharge any of such duties. All costs and expenses incurred by
the Secured Party in connection therewith, together with interest thereon at
the Secured Party's National Variable Rate (as defined in the Mississippi One
Loan Agreement) plus 4% per annum, shall become part of the Obligations secured
hereby and be paid by the Debtor upon demand.
(E) INDEMNIFICATION, ETC. The Debtor hereby expressly
indemnifies and holds the Secured Party harmless from any and all claims,
causes of action, or other proceedings, and from any and all liability, loss,
damage, and expense of every nature, arising by reason of the Secured Party's
enforcement of its rights and remedies hereunder, or by reason of the Debtor's
failure to comply with any environmental or other law or regulation, other than
any such claim, cause of action or other proceeding, liability, loss, damage or
expense arising by reason of gross negligence, willful misconduct or violation
of law on the part of the Secured Party.
(F) POWER OF ATTORNEY. The Debtor hereby constitutes and
appoints the Secured Party or the Secured Party's designee during the term of
any Obligations secured by this Security Agreement as its attorney-in-fact,
which appointment is an irrevocable, durable agency, and coupled with an
interest, with full power of substitution. This power of attorney and mandate
is for the purpose of taking, upon an Event of Default, whether in the name of
the Debtor or in the name of the Secured Party, any action which the Debtor is
obligated to perform hereunder or which the Secured Party may deem necessary or
advisable to accomplish the purposes of this Security Agreement. In taking any
action in accordance with this Section 6(F), the Secured Party shall not be
deemed to be the agent of the Debtor. The powers conferred upon the Secured
Party in this Section are solely to protect its interest in the Collateral and
shall not impose any duty upon the Secured Party to exercise any such powers.
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(G) CONTINUING EFFECT. This Security Agreement, the Secured
Party's security interest in the Collateral, and all other documents or
instruments contemplated hereby shall continue in full force and effect until
all of the Obligations have been satisfied in full, each of the Loan Agreements
and the Mercury Guaranty has been terminated in accordance with its respective
terms and the Debtor has sent a valid written demand to the Secured Party for
termination of this Security Agreement.
(H) BINDING EFFECT. This Security Agreement shall be binding
upon and inure to the benefit of the Debtor and the Secured Party and their
respective successors and assigns.
(I) SECURITY AGREEMENT AS FINANCING STATEMENT. A photographic
copy or other reproduction of this Security Agreement may be used as a
financing statement.
(J) GOVERNING LAW. Except to the extent governed by
applicable federal law, this Security Agreement shall be governed by and
construed in accordance with the laws of the State of Louisiana without
reference to choice of law doctrine.
(K) NOTICES. All notices hereunder shall be deemed to be duly
given upon delivery in the form and manner set forth in Section 8(E) of the
Mercury Guaranty to the parties at the following addresses (or such other
address for a party as shall be specified by like notice):
If to CoBank, as follows: If to the Debtor, as follows:
CoBank, ACB Mercury, Inc.
000 Xxxxxxxx Xxxxxxx X.X. Xxx 0000
Xxxxx 0000 Xxxx Xxxxxxx, Xxxxxxxxx 00000
Xxxxxxx, Xxxxxxx 00000 Attn: Xxxxx Xxxxx; cc: Xxxxxx X. Xxxxxxx
Attn: Rural Utility Banking Group Fax No.: (000) 000-0000
Fax No.: (000) 000-0000
(L) SEVERABILITY. The determination that any term or
provision of this Security Agreement is unenforceable or invalid shall not
affect the enforceability or validity of any other term or provision hereof.
SECTION 7. LOUISIANA PROVISIONS.
(A) GENERAL. The provisions of this Section 7 shall apply to
the Collateral and all proceeds thereof at all times during which such
Collateral or the proceeds thereof are located in Louisiana or are otherwise
subject to the application of Louisiana law in any respect. The term
"Louisiana Collateral" as used herein shall refer to all portions of the
Collateral and the proceeds thereof that are from time to time located in the
State of Louisiana or are otherwise subject to
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Louisiana law at all times during which such portions or proceeds thereof are
located in Louisiana or are otherwise mandatorily subject to the application of
Louisiana law under the applicable laws of other states.
(B) FINANCING STATEMENTS. Contemporaneously with the
execution of this Security Agreement, the Debtor has completed and signed one
or more appropriate Louisiana UCC-1 financing statements with regard to the
Collateral and the proceeds thereof. The Debtor authorizes the Secured Party,
at the Debtor's expense, to file multiple originals, or photocopies, carbon
copies or facsimile copies of such Louisiana UCC-1 financing statements with
the appropriate filing officer or officers in the State of Louisiana, pursuant
to the provisions of Chapter 9 of the Louisiana Commercial Laws.
(C) IDENTIFICATION NUMBER. The Debtor shall give the Secured
Party 30 days' written notice prior to any change in the Debtor's employer
identification number by the Debtor. In the event of any change whatsoever in
the Debtor's employer identification number, the Debtor will execute and file
any new financing statements or any other documents that are necessary or
desirable as determined by the Secured Party in its sole discretion to preserve
and continue the Secured Party's security interests under this Security
Agreement within thirty (30) days after such change.
(D) EVENT OF DEFAULT; REMEDIES. Upon the occurrence of any
Default hereunder, the Secured Party shall have the following rights and
remedies with respect to the Louisiana Collateral, which rights and remedies
are in addition to and are not in lieu or limitation of any other rights and
remedies that may be provided in this Security Agreement, the Loan Agreements,
the Mercury Guaranty or any related documents, under Chapter 9 of the Louisiana
Commercial Laws (La. R.S. Sections 10:9-101, et seq.), under the Uniform
Commercial Code of any state other than Louisiana, or at law or equity
generally:
(1) The Secured Party may cause the Louisiana
Collateral, or any part or parts thereof, to be immediately seized
wherever found, and sold, whether in term of court or in vacation, under
ordinary or executory process, in accordance with applicable Louisiana
law, to the highest bidder for cash, with or without appraisement,
without the necessity of making additional demand, or of notifying the
Debtor or placing the Debtor in default.
(2) For purposes of foreclosure under Louisiana
executory process procedures, the Debtor confesses judgment and
acknowledges to be indebted unto and in favor of the Secured Party up to
the full amount of the Obligations, in principal, interest, costs,
expenses, attorneys' fees and other fees and charges. To the extent
permitted under applicable Louisiana law, the Debtor additionally
waives: (a) the benefit of appraisal as provided in Articles 2332,
2336, 2723 and 2724 of the Louisiana Code of Civil Procedure and all
other laws with regard to appraisal upon judicial sale; (b) the demand
and 3 days' delay as provided under Articles 2639 and 2721 of the
Louisiana Code of Civil Procedure; (c) the notice of seizure as provided
under Articles 2293 and 2721 of the Louisiana Code of Civil Procedure;
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Security Agreement/Mercury
Loan No. T0310
Loan No. T0347
(d) the 3 days' delay provided under Articles 2331 and 2722 of the
Louisiana Code of Civil Procedure; and (e) all other benefits provided
under Articles 2331, 2722 and 2723 of the Louisiana Code of Civil
Procedure and all other similar provisions of the Louisiana Code of
Civil Procedure not specifically listed hereinabove.
(3) Should any of the Louisiana Collateral be seized as
an incident to an action for the recognition or enforcement of the
Obligations or this Security Agreement, the Loan Agreements, the Mercury
Guaranty or any related document, by executory process, sequestration,
attachment, writ of fieri facias or otherwise, the Debtor agrees that
the court issuing any such order shall, if requested by the Secured
Party, appoint the Secured Party or any person or entity named by the
Secured Party at the time such seizure is requested, or at any time
thereafter, as keeper of the Louisiana Collateral as provided under La.
R.S. Sections 9:5136, et seq. The Debtor agrees to pay the reasonable
fees of such keeper, which compensation to the keeper shall also be a
part of the Obligations secured under this Security Agreement.
(4) Should it become necessary for the Secured Party to
foreclose against the Louisiana Collateral, all declarations of fact
that are made under an authentic act before a Notary Public in the
presence of two witnesses, by a person declaring such facts to lie
within his or her knowledge, shall constitute authentic evidence for
purposes of executory process and also for purposes of La. R.S. Section
9:3509.1, La. R.S. Section 9:3504(D)(6) and La. R.S. Section 10:9-508,
as applicable.
(E) GOVERNING LAW. ANYTHING TO THE CONTRARY CONTAINED IN THIS
SECURITY AGREEMENT NOTWITHSTANDING, THE SECURITY INTERESTS IN THE LOUISIANA
COLLATERAL GRANTED IN THIS SECURITY AGREEMENT, AND THE SECURED PARTY'S REMEDIES
IN THE COURTS SITTING IN AND FOR THE STATE OF LOUISIANA WITH RESPECT TO THE
LOUISIANA COLLATERAL SHALL BE GOVERNED BY LOUISIANA LAW.
SECTION 8. FCC MATTERS. Notwithstanding any other provision of this
Security Agreement:
(A) Any foreclosure on, sale, transfer or other disposition
of, or the exercise or relinquishment of any right to vote or consent with to,
any of the Collateral by the Secured Party shall be pursuant to Section 310(d)
of the Communications Act of 1934, as amended, and the applicable rules and
regulations thereunder, and, if and to the extent required thereby, subject to
the prior approval or notice to and non-opposition of the FCC.
(B) If a Default shall have occurred and be continuing, the
Debtor shall take any action, which the Secured Party may reasonably request in
order to transfer and assign to the Secured Party, or to such one or more third
parties as the Secured Party may designate, or to a combination
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Security Agreement/Mercury
Loan Xx. X0000
Xxxx Xx. X0000
of the foregoing, each FCC license or permit owned by the Debtor. The Secured
Party is empowered, to the extent permitted by applicable law, to request the
appointment of a receiver from any court of competent jurisdiction. Such
receiver may be instructed by the Secured Party to seek from the FCC an
involuntary transfer of control of each such FCC license or permit for the
purpose of seeking a bona fide purchaser to whom control will ultimately be
transferred. The Debtor hereby agrees to authorize such an involuntary
transfer of control upon the request of the receiver so appointed and, if the
Debtor shall refuse to authorize the transfer, its approval may be required by
the court. Upon the occurrence and during the continuance of a Default, the
Debtor shall further use its best efforts to assist in obtaining approval of
the FCC and any state regulatory bodies, if required, for any action or
transactions contemplated by this Security Agreement, including, without
limitation, the preparation, execution and filing with the FCC and any state
regulatory bodies of the assignor's or transferor's portion of any application
or applications for consent to the assignment of any FCC license or permit or
transfer of control necessary or appropriate under the rules and regulations of
the FCC or any state regulatory body for approval or non-opposition of the
transfer or assignment of any portion of the Collateral, together with any FCC
license or permit.
(C) The Debtor acknowledges that the assignment or transfer of
each FCC license or permit is integral to the Secured Party's realization of
the value of the Collateral, that there is no adequate remedy at law for
failure by the Secured Party to comply with the provisions of this Section 8
and that such failure would not be adequately compensable in damages, and
therefore agrees, without limiting the right of the Secured Party to seek and
obtain specific performance of other obligations of the Debtor contained in
this Security Agreement, that the agreements contained in this Section 8 may be
specifically enforced.
(D) In accordance with the requirements of 47 C.F.R. Section
22.937(F), or any successor provision thereto, the Secured Party shall notify
the Debtor and the FCC in writing at least 10 days prior to the date on which
the Secured Party intends to exercise its rights, pursuant to this Security
Agreement or any of the other Loan Documents, by foreclosing on, or otherwise
disposing of, any Collateral in connection with which such notice is required
pursuant to 47 C.F.R. Section 22.937(F) or any successor provision thereto.
[Signatures on next page]
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Security Agreement/Mercury
Loan No. T0310
Loan No. T0347
THUS DONE AND SIGNED in several counterparts at the places and on the
dates indicated below and in the presence of the respective undersigned
Notaries Public and the respective undersigned witnesses indicated below, by
the duly authorized officers of the respective parishes, after a due reading of
the whole.
At Lake Charles, Louisiana, on July 1, 1996.
MERCURY, INC.
By: /s/ XXXXXXX X. XXXXXXX, XX.
------------------------------------
Name: XXXXXXX X. XXXXXXX, XX.
-------------------------------
Title: PRESIDENT
------------------------------
Attest:
By: /s/ XXXXXX X. XXXXXXX
------------------------------------
Name: XXXXXX X. XXXXXXX
-------------------------------
Title: SECRETARY
-----------------------------
[CORPORATE SEAL]
Witnesses to all Signatures:
/s/ XXXXXX XXXX
-------------------------------------------
Witness
/s/ XXX XXXXXXXX
-------------------------------------------
Witness
(ILLEGIBLE)
-------------------------------------------
Notary Public
My commission expires: LIFETIME COMMISSION
--------------------
[NOTARIAL SEAL]
(Signatures Continued on Next Page)
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Security Agreement/Mercury
Loan No. T0310
Loan No. T0347
(Signatures Continued from Previous Page)
At Atlanta, Georgia on July 2, 1996.
COBANK, ACB
By: /s/ XXXX XXX XXXXXXX
-----------------------------------
Name: XXXX XXX XXXXXXX
------------------------------
Title: VICE PRESIDENT
-----------------------------
Witnesses to Signature:
/s/ XXXXXX XXXXXX
-----------------------------------
Witness
/s/ XXXX XXXXXX
-----------------------------------
Witness
/s/ XXXXXXXX X. XXXXXX
-----------------------------------
Notary Public
My commission expires: Notary Public, Xxxx County, Georgia
My Commission Expires April 25, 1999
------------------------------------
[NOTARIAL SEAL]
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SCHEDULE A
TO
SECURITY AGREEMENT
OF
MERCURY, INC.
1. Set forth below are the present locations (by county or parish
and state) of the Debtor's inventory and equipment:
Calcasieu Parish, Louisiana
East Baton Rouge Parish, Louisiana
Xxxx Xxxxx Parish, Louisiana
Lafayette Parish, Louisiana
Pointe Coupee Parish, Louisiana
Vermilion Parish, Louisiana
2. Set forth below are the locations (by county or parish and state)
at which any of the Debtor's inventory and equipment has been located within
the past five years:
Calcasieu Parish, Louisiana
East Baton Rouge Parish, Louisiana
Xxxx Xxxxx Parish, Louisiana
Lafayette Parish, Louisiana
Pointe Coupee Parish, Louisiana
Vermilion Parish, Louisiana
3. Set forth below is a description of any exceptions to the
representation made in Section 3(E) of the Security Agreement:
None.
