Exhibit 10.16
SECURITY AGREEMENT
THIS SECURITY AGREEMENT (this "Security Agreement") is made as of the
18th day of December, 1998 by XXXXXXX AMERICAN CORPORATION (the "Borrower"),
XXXXXXX ENTERPRISES, INC. ("Xxxxxxx Enterprises"), XXXXXX-AMERICAN COMPANY, INC.
("Xxxxxx-American"), and XXXXXX-AMERICAN COMPANY OF FLORIDA, INC., a Florida
corporation ("R-A Florida," and together with Xxxxxxx Enterprises and Xxxxxx-
American, the "Guarantors", and together with the Borrower and the other
Guarantors, individually and collectively, the "Companies") in favor of FIRST
UNION NATIONAL BANK, a national banking association, as agent for the Lenders
pursuant to the Credit Agreement described below ("Agent").
BACKGROUND
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A. Borrower has entered into that certain Credit Agreement dated of even
date herewith (as amended, restated or otherwise modified from time to time, the
"Credit Agreement") with for the lenders identified therein (together with such
additional financial institutions as may become Lenders from time to time as
therein provided, "Lenders").
B. Guarantors have executed a Guaranty in favor of the Lenders dated of
even date herewith (as amended, restated or otherwise modified from time to
time, the "Guaranty").
C. As a condition to Lenders' willingness to enter into the Credit
Agreement, the Companies are willing to execute and deliver to Agent this
Security Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and intending to be legally bound,
the Companies and Agent hereby agree as follows:
A. Definitions. All capitalized terms used and not defined herein shall have
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the respective meaning ascribed thereto in the Credit Agreement. In addition,
as used herein, the following terms shall have the following meanings:
1. Books and Records. The term "Books and Records" means all of the
Companies' books and records, including without limitation, all books
and records indicating, summarizing, or evidencing the Collateral,
including without limitation, computer runs, invoices, tapes,
processing software, processing contracts (such as contracts for
computer time and services) and any computer prepared information,
tapes, or data of every kind and description relating to the
Collateral, whether in the possession of any Companies or in the
possession of third parties..
2. Collateral. The term "Collateral" means the all present and future
assets of the Companies, whether now owned or hereafter acquired, and
any proceeds thereof, including without limitation all accounts,
contract rights, leases, and any other
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rights of the Companies to payment for goods sold or leased or for
services rendered; furniture; furnishings; fixtures; equipment;
machinery; accessories; moveable trade fixtures; goods; inventory;
building improvement and construction materials, supplies and
equipment; chattel paper; instruments; documents; funds on deposit with
Lenders and their affiliates; Books and Records, investment property,
securities entitlements, financial assets and general intangibles; as
well as all parts, replacements, substitutions, profits, products and
cash and non-cash proceeds of the foregoing (including insurance and
condemnation proceeds payable by reason of condemnation of or loss or
damage thereto) in any form and wherever located. The Collateral shall
not include rights of the Companies under interest rate protection
agreements, swaps, hedging contracts or similar arrangements (including
without limitation any swap agreement as defined in 11 U.S.C. (S)101)
with any Lender.
3. Liabilities. The term "Liabilities" means any and all obligations and
indebtedness of every kind and description of the Companies to the
Lenders pursuant to, under, or in connection with the Loan Documents,
whether such debts or obligations are primary or secondary, direct or
indirect, absolute or contingent, sole, joint or several, secured or
unsecured, due or to become due, contractual or tortious, arising by
operation of law or otherwise, or now or hereafter existing, whether
incurred by any Companies as principal, surety, endorser, guarantor,
accommodation party or otherwise, including, without limitation,
principal, interest and fees, late fees and expenses (including
attorneys' fees and costs and/or the allocated fees and costs of
Agent's in-house legal counsel, to the extent required to be paid under
the Loan Documents), or that have been or may hereafter be contracted
or incurred, and any obligations of the Companies or any of them under
interest rate protection agreements, swaps, hedging contracts or
similar arrangements with any Lender (including without limitation, any
swap agreements as defined in 11U.S.C. (S)101). If a party ceases to be
a Lender, any obligations under interest rate protection agreements,
swaps, hedging contracts or similar arrangements (including without
limitation, any swap agreements as defined in 11U.S.C. (S)101) with
that party prior to the date it ceased to be a Lender shall continue to
be Liabilities secured hereunder.
4. Loan Documents. The term "Loan Documents" means this Security
Agreement, the Credit Agreement, the Note, the Guaranty, and any other
documents and agreements executed and delivered in connection with the
Credit Agreement.
5. Security Agreement. The term "Security Agreement" means this Security
Agreement, together with all Schedules and Exhibits hereto as may be
amended, restated or otherwise modified from time to time.
6. Uniform Commercial Code. The term "Uniform Commercial Code" means the
Uniform Commercial Code, in effect from time to time in the
Commonwealth of Pennsylvania.
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Unless the context otherwise requires, all capitalized terms not
specifically defined herein which are defined in the Uniform Commercial
Code shall have the meanings stated therein.
B. Security Interest. In order to secure the due and punctual payment and
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performance of the Liabilities, the Companies hereby grant to Agent, for
the benefit of the Lenders, a continuing security interest in and general
lien upon their right, title and interest in the Collateral. The security
interests granted herein are granted as security only and shall not subject
Agent to, or in any way affect or modify, any obligation or liability of
the Companies with respect to any of the Collateral or any transaction
which gave rise thereto.
C. Further Assurances; Filing.
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1. Delivery of Documents, etc. At any time and from time to time, upon
the demand of Agent, the Companies will, at the Companies' expense:
(i) give, execute, deliver, file, and/or record any notice, statement,
instrument, document, agreement, or other papers that may be necessary
or desirable, or that Agent may request, in order to create, preserve,
perfect, or validate any security interest granted pursuant hereto or
intended to be granted hereunder or to enable Agent to exercise or
enforce its rights hereunder or with respect to such security
interest; (ii) keep, stamp, or otherwise xxxx any and all documents,
instruments, chattel paper, and their respective Books and Records in
such manner as Agent may reasonably require to evidence the security
interest granted hereunder.
2. Filing of Financing Statement. At Agent's sole option, and without
the consent of the Companies, Agent may file a carbon, photographic,
or other reproduction of this Security Agreement or any financing
statement executed pursuant hereto as a financing statement in any
jurisdiction so permitting. Without the prior written consent of
Agent, no Companies shall file or authorize or permit to be filed in
any jurisdiction any such financing or like statement in which First
Union National Bank or its successor as Agent is not named as the sole
secured party as Agent for the Lender, except as permitted under the
Credit Agreement.
D. Representations and Warranties. Each Company represents and warrants to
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Agent, which representations and warranties shall be continuing
representations and warranties until all of the Liabilities are satisfied
in full, as follows:
1. Security Agreement Questionnaire. All information provided by such
Companies to Agent and set forth on the Security Agreement
Questionnaire attached hereto as Schedule "A" and made a part hereof,
is complete, true and correct (subject to subsequent disclosure
pursuant to Paragraph E.2. hereof). If, for any reason, the Security
Agreement Questionnaire is not attached to this Security Agreement at
the time of execution, such failure shall in no way alter Agent's
right to rely upon the representations and warranties contained in
the
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Security Agreement Questionnaire and the other representations and
warranties contained in this Section D. The Companies agrees that
Agent may attach the Security Agreement Questionnaire to this Security
Agreement at any time subsequent to the execution of this Security
Agreement.
2. Deposit Accounts. Set forth on Schedule B is a complete, true and
correct listing of all deposit accounts maintained by any of the
Companies including the name of the depository institution, how the
account is titled, and the account number (subject to subsequent
disclosure pursuant to Paragraph E.2. hereof).
3. No Consents Necessary. No consent or approval of any person or
entity, including, without limitation, any debt or equity holder of
any Companies, or of any public authority, is necessary for the valid
execution, delivery and performance of this Security Agreement, or any
document or instrument executed in connection herewith, or the
exercise by Agent or Lenders of their rights and remedies hereunder
that have not been obtained.
4. Title. The Companies are, or to the extent that any Collateral will
be acquired after the date hereof, will be, the owners of the
Collateral, holding good and marketable title thereto, free from any
lien, security interest, encumbrance, or claim other than the liens
and encumbrances of Agent and have the right to grant the security
interests created by this Security Agreement subject to Permitted
Liens under the Credit Agreement.
5. No Fictitious Names. The Companies do not operate or issue invoices
under any name other than the name(s) set forth on the signature page
hereof and as otherwise disclosed on Schedule A.
6. Collateral Not Subject to Agreements or Licenses. The Collateral is
not subject to or restricted by any agreement or license relating to
patents, trademarks, trade secrets, or copyrights, except that the
Companies' computer and word processing equipment is subject to
various software licenses or otherwise disclosed on Schedule A.
E. Covenants. Each Company hereby covenants and agrees that for as long as
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any Liabilities are outstanding:
1. Defense of Collateral. The Companies shall defend the Collateral
against all claims and demands of all persons or entities at any time
claiming any interest therein other than Agent.
2. Notice of Changes in Location of Chief Executive Office, Residence,
Books and Records, Collateral. The Companies shall provide Agent with
prompt written notice of: (i) any intended change in the chief
executive office or residence of the Companies, and/or any office
where the Companies maintain their Books
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and Records; (ii) the location or movement of any Collateral to or at
an address other than the addresses set forth on Schedule A hereto;
and (iii) the establishment of any new deposit account, all such
notices to be received by Agent at least 30 days prior to the
effective date of any such change; provided, that no notice shall be
required pursuant to Clause (i) or (ii) above with respect to any
sales office location at which no Books and Records are maintained
other than Books and records that are duplicates of Books and Records
maintained at other locations of which Agent has notice hereunder and
at which the aggregate value of all other Collateral located at such
premises does not exceed $20,000. If any such new location as set
forth in subparagraphs (i) and (ii) hereof is on leased or mortgaged
premises, the Companies, upon request of Agent, will furnish Agent,
prior to the effective date of any such change, with landlord's or
mortgagee's waivers pertaining to such premises in form and substance
reasonably satisfactory to Agent. With respect to any new deposit
account, the Companies shall, if required by Agent, or to the first
use of such deposit account, furnish to Agent with blocked account
letters or such other agreements with the applicable depository
institution as Agent shall reasonably require, in each case in form
and substance reasonably satisfactory to Agent.
3. Security Interests in Collateral. The Companies shall keep the
Collateral free from any lien, security interest, or encumbrance
except those in favor of Agent and except as permitted pursuant to the
Credit Agreement, in good order and repair, reasonable wear and tear
excepted, and will not waste or destroy the Collateral or any part
thereof. If reasonably requested by Agent, the Companies shall give
notice of Agent's security interests in the Collateral to any third
person with whom the Companies has any actual or prospective
contractual relationship or other business dealings.
4. Maintenance, Inspection of Books and Records. The Companies shall
maintain complete and accurate Books and Records and shall make all
necessary entries therein to reflect the costs, values and locations
of the Collateral and all payments, credits and adjustments thereto.
The Companies shall keep Agent fully informed as to the location of
all such Books and Records, shall permit Agent and its authorized
agents to have full, complete and unrestricted access thereto at all
reasonable times to inspect, audit and make copies of any and all such
Books and Records (collectively, a "Records Inspection") and upon
submission to the Companies of an invoice therefor, the Companies will
reimburse Agent for any and all fees and costs related to any Records
Inspection by Agent and its authorized agents, provided that, unless
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an Event of Default has occurred and is continuing : (i) Agent shall
give Companies reasonable notice of such Records Inspection; and (ii)
Agent shall not perform more than three Records Inspections (not
including ordinary course visits and meetings) at the premises of the
Companies during any twelve month period. Agent's rights hereunder
shall be enforceable at law or in equity, and the Companies consents
to the entry of judicial orders or injunctions enforcing specific
performance of such obligations hereunder.
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5. Maintenance and Inspection of Equipment. With respect to equipment
constituting Collateral, the Companies shall: (i) keep accurate books
and records with respect thereto, including, without limitation,
maintenance records; (ii) upon request, deliver to Agent all evidence
of ownership in such Collateral, including certificates of title with
Agent's interest appropriately noted on the certificate; (iii) permit
Agent and its authorized agents to inspect any or all such equipment
at all reasonable times, provided that, unless an Event of Default has
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occurred: (A) Agent shall give Companies reasonable notice of such
inspection of equipment; and (B) Agent shall not perform more than
three such inspections (not including ordinary course visits and
meetings) at the premises of the Companies during any twelve month
period; (iv) preserve such equipment, excluding obsolete equipment, in
good condition and repair, and pay the cost of all replacement parts,
repairs to and maintenance of such equipment, and (v) if after the
date hereof, any of the Collateral is moved to or located upon land
(other than at locations identified on the Security Agreement
Questionnaire) which land is the subject of a lease or mortgage, at
the request of Agent, use reasonable best efforts to deliver an
agreement of subordination from the lessor or mortgagee providing that
any lien of such party shall be subordinate to the security interest
of Agent granted herein.
6. Continuing of Perfected Status of Collateral. The Companies agrees to
cooperate and join, at its expense, with Agent in taking such steps as
are necessary, in Agent's judgment, to perfect or continue the
perfected status of the security interests granted herein, including,
without limitation, the execution and delivery of any financing
statements, amendments thereto and continuation statements, the
notation of encumbrances in favor of Agent on certificates of title,
and the execution and filing of any collateral assignments and any
other instruments requested by Agent to perfect its security interest
in the Collateral and any and all general intangibles relating to the
Collateral. Agent is expressly authorized to file financing statements
without the Companies's signature.
F. General Authority.
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1. Bank as Attorney-in-Fact. Each Company hereby irrevocably appoints
Agent (and any of its attorneys, officers, employees, or agents), upon
the occurrence and during the continuation of an Event of Default, as
its true and lawful attorney-in-fact, said appointment being coupled
with an interest, with full power of substitution, in the name of the
Companies, Agent, or otherwise, for the sole use and benefit of Agent
in its sole discretion, but at the Companies's expense, to exercise,
to the extent permitted by law, in its name or in the name of the
Companies or otherwise, the powers set forth herein, whether or not
any of the Liabilities are due, such powers, including, but not
limited to, the power at any time: (i) to endorse the name of the
Companies upon any instruments of payment,
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invoice, freight, or express xxxx, xxxx of lading, storage, or
warehouse receipt relating to the Collateral; (ii) to demand, collect,
receive payment of, settle, compromise, or adjust all or any of the
Collateral; (iii) to sign and file one or more financing statements
naming the Companies as debtor and Agent as secured party and
indicating therein the types or describing the items of Collateral
herein specified; (iv) to correspond and negotiate directly with
insurance carriers; and (v) to execute any notice, statement,
instrument, agreement, or other paper that Agent may require to
create, preserve, perfect, or validate any security interest granted
pursuant hereto or to enable Agent to exercise or enforce its rights
hereunder or with respect to such security interest.
2. Liability of Bank as Attorney-in-Fact. Neither Agent nor its
attorneys, officers, employees, or agents shall be liable for acts,
omissions, any error in judgment, or mistake in fact in its/their
capacity as attorney-in-fact. Each Company hereby ratifies all acts
of Agent as its attorney-in-fact. This power, being coupled with an
interest, is irrevocable until the Liabilities have been fully
satisfied. Agent shall not be required to take any steps necessary to
preserve any rights against prior parties with respect to any of the
Collateral.
3. Effect of Extensions and Modifications. Agent may extend the time of
payment, arrange for payment in installments, or otherwise modify the
terms of, or release, any of the Collateral, without thereby incurring
responsibility to, or discharging or otherwise affecting any liability
of, any Companies or any other obligor.
G. Events of Default. The occurrence of an Event of Default under the Credit
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Agreement shall constitute an Event of Default and under this Security
Agreement.
H. Remedies.
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1. Acceleration of Liabilities; General Rights of Bank. Upon the
occurrence and during the continuance of an Event of Default, Agent
may, in accordance with Paragraph 7.2 of the Collateral Agreement,
exercise any and all rights and remedies it has under this Security
Agreement, any other Loan Document and/or applicable law.
2. Right of Setoff. If any Liabilities shall be due and payable or any
one or more Events of Default shall have occurred and be continuing,
whether or not the Agent shall have made demand under any Loan
Document and regardless of the adequacy of any collateral for the
Liabilities or other means of obtaining repayment of the Liabilities,
each Lender shall have the right, without notice to the Borrower and
is specifically authorized hereby to set-off against and apply to the
then unpaid balance of the Liabilities any items or funds of the
Borrower held by each Lender or any affiliate of such Lender, any and
all deposits (whether general or special, time or demand, matured or
unmatured) or any other property
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of the Borrower including, without limitation, securities and/or
certificates of deposit, now or hereafter maintained by any Borrower
for its or their own account with any Lender or any affiliate of such
Lender, and any other indebtedness at any time held or owing by any
Lender or any affiliate of such Lender, to or for the credit or the
account of Borrower, even if effecting such set-off results in a loss
or reduction of interest or the imposition of a penalty applicable to
the early withdrawal of time deposits. For such purpose, the Lenders
shall have, and Borrower hereby grant to each Lender, a first lien on
and security interest in such deposits, property, funds and accounts
and the proceeds thereof, subject to Permitted Liens under the Credit
Agreement.
3. Turnover of Property Held by Affiliates. Each Company authorizes any
affiliate of each Lender, upon the occurrence and during the
continuance of an Event of Default, at the request of any such Lender,
and without notice to Borrower, to turn over to the Agent any property
of such Companies, including, without limitation, funds and
securities, held by any Lender's affiliate for any such Companies's
account and to debit any deposit account maintained by such Companies
with such Lender's affiliate (even if such deposit account is not then
due or there results a loss or reduction of interest or the imposition
of a penalty in accordance with law applicable to the early withdrawal
of time deposits), in the amount requested by the Lenders up to the
amount of the Liabilities, and to pay or transfer such amount or
property to the Agent for application to the Liabilities.
4. Additional Rights and Remedies. In addition to the rights and
remedies available to Agent as set forth above, upon the occurrence of
an Event of Default hereunder, or at any time thereafter, Agent may at
its option in accordance with the Credit Agreement, immediately and
without notice, do any or all of the following, which rights and
remedies are cumulative, may be exercised from time to time, and are
in addition to any rights and remedies available to Agent under any
other agreement or instrument by and between any Companies and Agent:
a. Exercise any and all of the rights and remedies of a secured
party under the Uniform Commercial Code, including, without
limitation, the right to require the Companies to assemble the
Collateral and make it available to Agent at a place reasonably
convenient to the parties;
b. Notify account debtors of any Companies that their obligations to
such Companies are payable directly to Agent, for benefit of the
Lenders, and collect such sums.
c. Operate, utilize, recondition and/or refurbish any of the
Collateral for the purpose of enhancing or preserving the value
thereof by any means deemed appropriate by Agent, in its sole
discretion, including, without limitation, converting raw
materials and/or work-in-process into finished goods;
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d. Demand, xxx for, collect, or retrieve any money or property at
any time payable, receivable on account of, or in exchange for,
or make any compromise, or settlement deemed desirable with
respect to any of the Collateral;
e. Upon five (5) business days' prior written notice to the Borrower
(or one (1) day notice by telephone with respect to Collateral
that is perishable or threatens to decline rapidly in value),
which each Company hereby acknowledges to be sufficient,
commercially reasonable and proper, Agent may sell, lease or
otherwise dispose of any or all of the Collateral at any time and
from time to time at public or private sale, with or without
advertisement thereof. Upon a sale of the Collateral by Agent,
Agent shall apply the sale proceeds: first, to the amount of any
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reasonable expenses, including counsel fees and expenses,
incurred by Agent in connection with (i) the administration of
this Security Agreement, (ii) the custody, preservation, sale or
collection or realization of the Collateral, (iii) the exercise
or enforcement of Agent's rights hereunder, or (iv) the failure
of Companies to perform hereunder; second, to accrued and unpaid
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interest and fees; and third, to the principal balance of
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indebtedness under the Credit Agreement to Lenders on the basis
of their pro rata shares of the outstanding principal balance of
the Loans (as defined therein), except the fees payable under
Paragraph 2.13 thereof, which shall be paid solely to Agent. Such
distribution of payments shall be made promptly in federal funds
immediately available at the office of each Lender set forth in
the Credit Agreement. Each Company waives the benefit of any
marshaling doctrine with respect to Agent's exercise of its
rights hereunder. Each Company grants a royalty-free license to
Agent for all patents, service marks, trademarks, tradenames,
copyrights, computer programs and other intellectual property and
proprietary rights sufficient to permit Agent to exercise all
rights granted to Agent under this Section. Agent or anyone else
may be the purchaser of any or all of the Collateral so sold and
thereafter hold such Collateral absolutely, free from any claim
or right of whatsoever kind, including any equity of redemption
of any Companies or any other obligor, any such notice, right
and/or equity of redemption being hereby expressly waived and
released.
I. Miscellaneous.
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1. Remedies Cumulative; No Waiver. The rights, powers and remedies of
Agent provided in this Security Agreement and any of the other Loan
Documents are cumulative and not exclusive of any right, power or
remedy provided by law or equity. No failure or delay on the part of
Agent in the exercise of any right, power or remedy shall operate as a
waiver thereof, nor shall any single or partial exercise of any right,
power or remedy preclude any other or further exercise thereof, or the
exercise of any other right, power or remedy.
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2. Notices. Each Company agrees that any notice, request or consent
required to be given to such Companies hereunder or in connection
herewith may be given to Borrower on behalf of such Companies. Any
notice, request or consent required hereunder or in connection
herewith shall be deemed satisfactorily given if in writing and
delivered by hand, mailed (registered or certified mail) or sent by
facsimile transmission to Agent or Borrower at their respective
addresses or telecopier number set forth below, or to any party at
such other addresses or telecopier numbers as may be given by any
party to the others in writing:
if to Borrower:
Xxxxxxx American Corporation
000 Xxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention:
Telecopier:
if to Agent:
First Union National Bank
0000 Xxxxxxxx Xxxxxx
XX 4843
Xxxxxxxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxx
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
3. Costs and Expenses; Indemnification. Whether or not the transactions
contemplated by this Security Agreement and the other Loan Documents
are fully consummated, the Borrower shall promptly pay (or reimburse,
as Agent may elect) all reasonable costs and expenses which Agent has
incurred or may hereafter incur in connection with the negotiation,
preparation, reproduction, interpretation, perfection, monitoring and
enforcement of the Loan Documents, the collection of all amounts due
under the Loan Documents, and all amendments, modifications, consents
or waivers, if any, to the Loan Documents. Such costs and expenses
shall include, without limitation, the fees and disbursements of
counsel to Agent, the costs of appraisals, searches of public records,
costs of filing and recording documents with public offices, internal
and/or external audit and/or examination fees and costs, stamp, excise
and other taxes, the fees of Agent's accountants, consultants or other
professionals, costs and expenses from any actual or attempted sale of
all or any part of the Collateral, or any exchange, enforcement,
collection, compromise, or settlement of any of the Collateral or
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receipt of the proceeds thereof, and for the care and preparation for
sale of the Collateral (including insurance costs) and defending and
asserting the rights and claims of Agent in respect thereof, by
litigation or otherwise. Each Company shall indemnify, defend and hold
harmless Agent with respect to any and all claims, expenses, demands,
losses, costs, fines or liabilities of any kind (including, without
limitation, those involving death, personal injury or property damage
and including reasonable attorneys fees and costs) arising from the
use or ownership of the Collateral other than those resulting from
Agent's own wilful misconduct or gross negligence. The reimbursement
and indemnification obligations of the Companies under this Section
shall constitute Liabilities secured by the Collateral and shall
survive any termination of the Loan Documents.
4. Governing Law. This Security Agreement shall be construed in
accordance with and governed by the substantive laws of the
Commonwealth of Pennsylvania without reference to conflict of laws
principles.
5. Integration. This Security Agreement and the other Loan Documents
constitute the sole agreement of the parties with respect to the
subject matter hereof and thereof and supersede all oral negotiations
and prior writings with respect to the subject matter hereof and
thereof.
6. Amendment; Waiver. No amendment of this Security Agreement, and no
waiver of any one or more of the provisions hereof shall be effective
unless set forth in writing and signed by the parties hereto.
7. Successors and Assigns. This Security Agreement (i) shall be
binding upon the Companies and the Agent and, where applicable, their
respective heirs, executors, administrators, successors and permitted
assigns, and (ii) shall inure to the benefit of the Companies and the
Agent and, where applicable, their respective heirs, executors,
administrators, successors and permitted assigns; provided, however,
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that no Companies may assign its rights hereunder or any interest
herein without the prior written consent of Agent, and any such
assignment or attempted assignment by such Companies shall be void and
of no effect with respect to Agent.
8. Severability. The illegality or unenforceability of any provision
of this Security Agreement or any instrument or agreement required
hereunder shall not in any way affect or impair the legality or
enforceability of the remaining provisions of this Security Agreement
or any instrument or agreement required hereunder. In lieu of any
illegal or unenforceable provision in this Security Agreement, there
shall be added automatically as a part of this Security Agreement a
legal and enforceable provision as similar in terms to such illegal or
unenforceable provision as may be possible.
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9. Consent to Jurisdiction and Service of Process. Each Company
irrevocably appoints each officer of Borrower as its attorney upon
whom may be served any notice, process or pleading in any action or
proceeding against it arising out of or in connection with this
Security Agreement, the Credit Agreement, the Notes, the Loan
Documents or any of the Collateral; each Company hereby consents that
any action or proceeding against it be commenced and maintained in any
court within the Commonwealth of Pennsylvania or in the United States
District Court for the Eastern District of Pennsylvania by service of
process on any officer of Borrower; and each Company agrees that the
courts of the Commonwealth of Pennsylvania and the United States
District Court for the Eastern District of Pennsylvania shall have
jurisdiction with respect to the subject matter hereof and the person
of each Company and the Collateral. Notwithstanding the foregoing,
Agent, in its absolute discretion may also initiate proceedings in the
courts of any other jurisdiction in which any Companies may be found
or in which any of its properties or Collateral may be located.
10. Inconsistencies. The Loan Documents are intended to be consistent.
However, in the event of any inconsistencies among any of the Loan
Documents, such inconsistency shall not affect the validity or
enforceability of any Loan Document. In the event of any inconsistency
or ambiguity in any of the Loan Documents, the Loan Documents shall
not be construed against any one party but shall be interpreted
consistent with Agent's policies and procedures.
11. Headings. The headings of sections and paragraphs have been included
herein for convenience only and shall not be considered in
interpreting this Security Agreement.
12. Schedules. If a Schedule and/or an Exhibit is attached hereto, the
provisions thereof are incorporated herein.
13. Waiver of Jury Trial; Acknowledgments.
a. EACH OF THE PARTIES HERETO HEREBY KNOWINGLY, VOLUNTARILY, AND
INTENTIONALLY WAIVES ANY RIGHTS IT MAY HAVE TO A TRIAL BY JURY IN
RESPECT OF ANY LITIGATION BASED HEREON OR ARISING OUT OF, UNDER
OR IN CONNECTION WITH THIS AGREEMENT OR THE NOTES OR OTHER LOAN
DOCUMENTS OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER ORAL OR WRITTEN) OR ACTIONS OF AGENT OR LENDERS. THIS
PROVISION IS A MATERIAL INDUCEMENT FOR AGENT'S ENTERING INTO THIS
AGREEMENT ON BEHALF OF THE LENDERS.
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b. BORROWER ACKNOWLEDGES THAT IT HAS HAD THE ASSISTANCE OF COUNSEL
IN THE REVIEW AND EXECUTION OF THIS AGREEMENT AND, SPECIFICALLY,
PARAGRAPH 13(a) HEREOF, AND FURTHER ACKNOWLEDGES THAT THE MEANING
AND EFFECT OF THE FOREGOING WAIVER OF JURY TRIAL HAVE BEEN FULLY
EXPLAINED TO BORROWER BY SUCH COUNSEL.
13
IN WITNESS WHEREOF the parties hereto have executed this Security
Agreement as of the date above first written.
Attest: XXXXXXX AMERICAN CORPORATION
By:/s/ Xxxxxx X. Xxxxxx, Xx. By:/s/ Xxxxxx X. Xxxxxxx
------------------------- ---------------------
Name: Xxxxxx X. Xxxxxx, Xx. Name: Xxxxxx X. Xxxxxxx
Title: Secretary Title: President
Attest: XXXXXXX ENTERPRISES, INC.
By:/s/ Xxxxxx X. Xxxxxx, Xx. By:/s/ Xxxxxx X. Xxxxx
------------------------- -------------------
Name: Xxxxxx X. Xxxxxx, Xx. Name: Xxxxxx X. Xxxxx
Title: Secretary Title: Treasurer
Attest: XXXXXX-AMERICAN COMPANY, INC.
By:/s/ Xxxxxx X. Xxxxxx, Xx. By:/s/ Xxxxxxx X. Xxxxxxxx
------------------------- -----------------------
Name: Xxxxxx X. Xxxxxx, Xx. Name: Xxxxxxx X. Xxxxxxxx
Title: Secretary Title: President
Attest: XXXXXX-AMERICAN COMPANY OF FLORIDA, INC.
By:/s/ Xxxxxx X. Xxxxxx, Xx. By:/s/ Xxxxxxx X. Xxxxxxxx
------------------------- -----------------------
Name: Xxxxxx X. Xxxxxx, Xx. Name: Xxxxxxx X. Xxxxxxxx
Title: Secretary Title: President
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