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EXHIBIT 10.4.2
NATIONSBANK(R)
NationsBank, N.A. (Carolinas) SECURITY AGREEMENT Date June 29, 1995
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Between
BANK; (SECURED PARTY)
NationsBank, N.A. (Carolinas)
Banking Center:
NC1-002-03-10 Xxxxxxxxx Xxxxxxxxxxx XX 00000
(address including county)
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and
DEBTOR/PLEDGOR:
American Aircarriers Support, Inc.
0000 Xxxxxxxx Xxxx Xxxx Xxxx XX 00000
(Name and address including county)
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Debtor/Pledgor is: [ ] Individual [X] Corporation [ ] Partnership [ ] Other
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Address is Debtor's: [ ] Residence [X] Place of Business [ ] Chief Executive Office if more than one place of business.
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(THIS AGREEMENT CONTAINS SOME PROVISIONS PRECEDED BY BOXES. XXXX ONLY THOSE
BOXES BESIDE PROVISIONS WHICH WILL BE APPLICABLE TO THIS TRANSACTION. A BOX
WHICH IS NOT MARKED MEANS THAT THE PROVISION BESIDE IT IS NOT APPLICABLE TO
THIS TRANSACTION.)
A. SECURITY INTEREST. For good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged and subject to the applicable terms
of this agreement, Debtor/Pledgor (hereinafter referred to as Debtor) assigns
and grants to Bank (also known as Secured Party), a security interest and lien
in the Collateral to secure the payment and the performance of the Obligation.
B. COLLATERAL. The security interest is granted in the following
("Collateral") (Check as applicable)
1.
[X] ACCOUNTS. Any and all accounts, accounts receivable, receivables, contract
rights, book debts, checks, notes, drafts, instruments, chattel paper,
acceptances, choses in action, any and all amounts due to Debtor from a factor
or other forms of obligations and receivables now existing or hereafter arising
out of the business of the Debtor, as well as any and all returned, refused and
repossessed goods, and the cash or non-cash proceeds resulting therefrom.
[X] INVENTORY. Any and all of Debtor's Inventory, including without limitation
any and all goods held for sale or lease or being processed for sale or lease
in Debtor's business as now or hereafter conducted, whether now owned or
hereinafter acquired, including all materials, goods and work in process,
finished goods, and other tangible property held for sale or lease or furnished
or to be furnished under contracts of service or used or consumed in Debtor's
business, along with all documents (including documents of title) covering
inventory, all cash and non-cash proceeds from the sale of inventory including
proceeds from insurance and specifically including but not limited (attach
Schedule if necessary):
[ ] EQUIPMENT. Any and all of Debtor's furnishings, fixtures and equipment,
wherever located, whether now owned or hereafter acquired, together with all
increases, parts, fittings, accessories, equipment, and special tools now or
hereafter affixed to any part thereof or used in connection therewith, and all
products, additions, substitutions, accessions, and all cash and non-cash
proceeds, including proceeds from insurance thereof and thereto, including
without limitation the following (attach Schedule if necessary)
[ ] FIXTURES. All of Debtor's fixtures now existing or hereafter acquired,
together with all substitutes and replacements therefor, all accessions and
attachments thereto, and all tools, parts and equipment now or hereafter added
to or used in connection therewith. These goods are or will become fixtures on
the following described real estate in ______________________ County,
____________________________ (State), owned by: ________________________________
(name of owner) more particularly described as follows:_________________________
________________________________________________________________________________
______________________________________________________________ (insert legal
description (or attach Exhibit) of property, not street address), including
without limitation the following (attach schedule if necessary): _______________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
[ ] INSTRUMENTS AND/OR INVESTMENT DOCUMENTS. The following described
instruments and documents including, without limitation, negotiable
instruments, promissory notes, and documents of title owned or to be owned by
Debtor, certificates of deposit, and all liens, security agreements, leases and
other contracts securing or otherwise relating to any of said instruments or
documents, and all cash and non-cash proceeds and products thereof and such
additional property receivable or distributed in respect of or in exchange for
all or any of such instruments or documents (attach Schedule if necessary): ____
________________________________________________________________________________
________________________________________________________________________________
[ ] GENERAL INTANGIBLES. All patents, trademarks, service marks, trade secrets,
copyrights and exclusive licenses (whether issued or pending) and all
documents, applications, materials and other matters related thereto, all
inventions, and all manufacturing, engineering and production plans, drawings,
specifications, processes and systems, all trade names, computer programs, data
bases, systems and software (including source and object codes), goodwill,
choses in action and all other general intangibles of Debtor whether now owned
or hereafter acquired and all cash and non-cash proceeds thereof, including
without limitation the following described intangible personal property, and
all chattel paper, documents and instruments relating to such intangibles,
including without limitation (attach schedule if necessary): ___________________
________________________________________________________________________________
________________________________________________________________________________
[ ] TIMBER. All of Debtor's uncut timber growing or to be grown on the
following described property, and all cash and non-cash proceeds including
proceeds from insurance, and all products thereof (complete legal description
of real property required)(attach Exhibit if necessary): _______________________
________________________________________________________________________________
________________________________________________________________________________
[ ] OTHER: ____________________________________________________________________
________________________________________________________________________________
___________________________________ (hereinafter referred to as "Goods" and all
proceeds thereof)
2. All substitutes and replacements for, accessions, attachments and other
additions to, tools, parts and equipment used in connection with, and proceeds
and products of, the above Collateral (including all income and benefits
resulting from any of the above, such as dividends payable or distributable in
cash, property or stock; interest, premium and principal payments; redemption
proceeds and subscription rights; all certificates of title, manufacturer's
statements of origin, other documents, accounts and chattel paper arising from
or related to the above Collateral, and returned or repossessed Collateral, any
of which, if received by Debtor, upon request shall be delivered immediately to
Bank.
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3. The balance of every deposit account of Debtor under control of Bank and
any other claim of Debtor against Bank, now or hereafter existing, liquidated
or unliquidated, and all money, instruments, securities, documents, chattel
paper, credits, claims, demands, income, and any other property, rights and
interests of Debtor which at any time shall come into the possession or
custody or under the control of Bank or any of its agents, affiliates or
correspondents, for any purpose, and the proceeds of any thereof. Bank shall be
deemed to have possession of any of the Collateral in transit to or set apart
for it or any of its agents, affiliates or correspondents.
C. OBLIGATION.
1. DESCRIPTION OF OBLIGATION. The following obligations ("Obligation") are
secured by this agreement: (a) All debts, obligations, liabilities and
agreements of Debtor to Bank, now or hereafter existing, arising directly or
indirectly between Debtor and Bank whether absolute or contingent, joint or
several, secured or unsecured, due or not due, contractual or tortious,
liquidated or unliquidated, arising by operation of law or otherwise, and all
renewals, extensions or rearrangement of any of the above; (b) Bank's
participation in any loan or other debt of Debtor to another person; (c) All
costs incurred by Bank to obtain, preserve, perfect and enforce this agreement
and maintain, preserve, collect and enforce the Collateral; (d) Interest on the
above amounts as agreed between Bank and Debtor; (e) All debt, obligations and
liabilities of
(if the preceding space is completed, such party, together with the Debtor
named above, is hereinafter referred to collectively as "Debtor") to Bank of
the kinds described in this Item C, now existing or hereinafter arising; (f)
All expenses of the Bank, including fees and expenses of the Bank's counsel,
incident to the enforcement of payment of all obligations of the Debtor by any
action or participation in, or in connection with a case or proceeding under
the Bankruptcy Code, or any successor statute thereto; (g) If the Debtor is not
the obligor of any of the Obligations, and in the event any amount paid to the
Bank on any Obligation is subsequently recovered from the Bank in or as a
result of any bankruptcy, insolvency or fraudulent conveyance proceeding, the
Debtor shall be liable to the Bank for the amounts so recovered up to the fair
market value of the Collateral whether or not the Collateral has been released
or the security interest terminated. In the event the Collateral has been
released or the security interest terminated, the fair market value of the
Collateral shall be determined, at the Bank's option, as of the date the
Collateral was released, the security interest terminated, or said amounts were
recovered; and (h) All amounts which may be owed to Bank pursuant to all other
loan documents executed between Bank and any other Debtor.
Notwithstanding the foregoing, if the Collateral is personal property used as a
principal residence (such as a mobile home or a houseboat) or "household goods"
(as that term is defined at 12 C.F.R. Section 227.12, as it may be amended from
time to time) which are not in the Bank's possession and which are not
fixtures, such Collateral shall not secure any liability contracted for
personal family or household purposes between the Debtor or an obligor and the
Bank already in existence on the date hereof or that arises hereafter, unless
the Debtor otherwise expressly agrees.
D. DEBTOR'S WARRANTIES. Debtor hereby represents and warrants to Bank as
follows:
1. FINANCING STATEMENTS. Except as may be noted by schedule attached hereto
and incorporated herein by reference, no financing statement covering the
Collateral is or will be on file in any public office, except the financing
statements relating to this security interest, and no security interest, other
than the one herein created, has attached or been perfected in the Collateral
or any part thereof.
2. OWNERSHIP. Debtor owns, or will use the proceeds of any loans by Bank to
become the owner of, the Collateral free from any setoff, claim, restriction,
lien, security interest or encumbrance except liens for taxes not yet due and
the security interest hereunder.
3. FIXTURES AND ACCESSIONS. None of the Collateral is affixed to real estate
or is an accession to any goods, or will become a fixture or accession, except
as expressly set out herein.
4. CLAIMS OF DEBTORS ON COLLATERAL. All account debtors and other obligors
whose debts or obligations are part of the Collateral have no right to setoffs,
counterclaims or adjustments, and no defenses in connection therewith.
5. POWER AND AUTHORITY. Debtor has full power and authority to make this
agreement.
E. DEBTOR'S COVENANTS. Until full payment and performance of all Obligations
and termination or expiration of any obligation or commitment of Bank to make
advances or loans to Debtor, unless Bank otherwise consents in writing:
1. OBLIGATION AND THIS AGREEMENT. Debtor shall perform all of its agreements
herein and in any other agreements between it and Bank.
2. OWNERSHIP OF COLLATERAL. Debtor shall defend the Collateral against all
claims and demands of all persons at any time claiming any interest therein
adverse to Bank. Debtor shall keep the Collateral free from all liens and
security interests except those for taxes not yet due and the security interest
hereby created.
3. INSURANCE. Debtor shall insure the Collateral with companies acceptable to
Bank. Such insurance shall be in an amount not less than the fair market value
of the Collateral and shall be against such casualties, with such deductible
amounts as Bank shall approve. All insurance policies shall be written for the
benefit of Debtor and Bank as their interests may appear, payable to Bank as
loss payee, or in other form satisfactory to Bank, and such policies or
certificates evidencing the same shall be furnished to Bank. All policies of
insurance shall provide for written notice to Bank at least 30 days prior to
cancellation. Risk of loss or damage is Debtor's to the extent of any
deficiency in any effective insurance coverage.
4. MAINTENANCE. Debtor shall keep all tangible Collateral in good condition.
5. BANK'S COSTS. Debtor shall pay all costs necessary to obtain, preserve,
perfect, defend and enforce this security interest, collect the Obligation, and
preserve, defend, enforce and collect the Collateral including but not limited
to taxes, assessments, insurance premiums, repairs, reasonable attorney's fees
and legal expenses, food, rent, storage costs and expenses of sales. Whether
Collateral is or is not in Bank's possession, and without any obligation to do
so and without waiving Debtor's default for failure to make any such payment,
Bank at its option may pay any such costs and expenses, discharge encumbrances
on Collateral, and pay for insurance of Collateral, and such payment shall be a
part of the Obligation and bear interest at the rate set out in the Obligation.
Debtor agrees to reimburse Bank on demand for any costs so incurred.
6. INFORMATION AND INSPECTION. Debtor shall (i) promptly furnish Bank any
information with respect to Collateral requested by Bank; (ii) allow Bank or
its representatives to inspect the Collateral, at any time and wherever
located, and to inspect and copy, or furnish Bank or its representatives with
copies of, all records relating to the Collateral and the Obligation; (iii)
furnish Bank or its representatives such information as Bank may request to
identify Collateral, at the time and in the form requested by Bank; and (iv)
deliver upon request to Bank shipping and delivery receipts evidencing the
shipment of goods and invoices evidencing the receipt of, and the payment for,
Collateral.
7. ADDITIONAL DOCUMENTS. Debtor shall sign and deliver any papers furnished
by Bank which are necessary or desirable in the judgment of Bank to obtain,
maintain and perfect the security interest hereunder and to enable Bank to
comply with the Federal Assignment of Claims Act or any other federal or state
law in order to obtain or perfect Bank's interest in Collateral or to obtain
proceeds of Collateral.
8. PARTIES LIABLE ON COLLATERAL. Debtor will preserve the liability of all
obligors on any Collateral, will preserve the priority of all security
therefor, and will deliver to Bank the original certificates of title on all
motor vehicles or other titled vehicles constituting the Collateral. Bank shall
have no duty to preserve such liability or security, but may do so at the
expense of Debtor, without waiving Debtor's default.
9. RIGHT OF BANK TO NOTIFY DEBTORS. At any time, whether Debtor is or is not
in default hereunder, Bank may notify persons obligated on any Collateral to
make payments directly to Bank and Bank may take control of all proceeds of any
Collateral. Until Bank elects to exercise such rights, Debtor, as agent of
Bank, shall collect and enforce all payments owed on Collateral.
10. RECORDS OF COLLATERAL. Debtor at all times will maintain accurate books
and records covering the Collateral. Debtor immediately will xxxx all books and
records with an entry showing the absolute assignment of all Collateral to Bank
and Bank is hereby given the right to audit the books and records of Debtor
relating to Collateral at any time and from time to time. The amounts shown as
owed to Debtor on Debtor's books and on any assignment schedule will be the
undisputed amounts owing and unpaid.
11. DISPOSITION OF COLLATERAL. If disposition of any Collateral gives rise to
an account, chattel paper or instrument, Debtor immediately shall notify Bank,
and upon request of Bank shall assign or indorse the same to Bank. No
Collateral may be sold, leased, manufactured, processed or otherwise disposed
of by Debtor in any manner without the prior written consent of Bank, except
Collateral sold, leased, manufactured, processed or consumed in the ordinary
course of business.
12. ACCOUNTS. Each account held as Collateral will represent the valid and
legally enforceable obligation of third parties, and shall not be evidenced by
any instrument or chattel paper.
13. LOCATION OF COLLATERAL. Debtor shall give Bank written notice of each
office of Debtor in which records of Debtor pertaining to accounts held as
Collateral are kept, and each location at which Collateral is or will be kept,
and of any change of any such location. If no such notice is given, all records
of Debtor pertaining to Collateral are and shall be kept at Debtor's address
shown above. All Collateral of Debtor will be kept at Debtor's address shown
above unless otherwise noted as follows:
14. NOTICE OF CHANGES. Debtor will notify Bank immediately of any material
change in the Collateral, of a change in Debtor's residence or location, of a
change in any matter warranted or represented by Debtor in this agreement or
furnished to Bank, and of any event of default.
15. USE AND REMOVAL OF COLLATERAL. Debtor will not use the Collateral illegally
nor, unless previously indicated as a fixture, permit the Collateral to be
affixed to real or personal property without the prior written consent of Bank.
Debtor will not permit any of the Collateral to be removed from the locations
specified herein without the prior written consent of Bank, except for the sale
of inventory in the ordinary course of business.
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16. POSSESSION OF COLLATERAL. Debtor will deliver all other instruments,
documents and chattel paper which are part of the Collateral and in Debtor's
possession to the Bank immediately, or if hereafter acquired, immediately
following acquisition, appropriately indorsed to Bank's order, or with
appropriate, executed powers. Debtor waives presentment, notice of acceleration,
demand, notice of dishonor, protest, and all other notices with respect thereto.
17. CONSUMER CREDIT. If any Collateral or proceeds includes obligations of
third parties to Debtor, the transactions giving rise to the Collateral shall
conform in all respects to the applicable state or federal law including but not
limited to consumer credit law. Debtor shall hold harmless and indemnify Bank
against any cost, loss or expense arising from Debtor's breach of this
covenant.
18. CHANGE OF NAME/STATUS. Without the written consent of Bank, Debtor shall
not change its name, change its corporate status, use any trade name or engage
in any business in which it was not engaged on the date of this agreement.
19. POWER OF ATTORNEY. Debtor appoints Bank as Debtor's attorney-in-fact with
full power in Debtor's name and behalf to do every act which Debtor is
obligated to do or may be required to do hereunder; however, nothing in this
paragraph shall be construed to obligate Bank to take any action hereunder nor
shall Bank be liable to Debtor for failure to take any action hereunder. This
appointment shall be deemed a power coupled with an interest and shall not be
terminable as long as the Obligations are outstanding and shall not terminate
on the disability or incompetence of the Debtor.
20. WAIVERS BY DEBTOR. Debtor waives notice of the creation, advance,
increase, existence, extension or renewal of, and of any indulgence with
respect to, the Obligation; waives presentment, demand, notice of dishonor, and
protest; waives notice of the amount of the Obligation outstanding at any time,
notice of any change in financial condition of any person liable for the
Obligation or any part thereof, notice of any event of default, and all other
notices respecting the Obligation; and agrees that maturity of the
Obligation and any part thereof may be accelerated, extended or renewed one or
more times by Bank in its discretion, without notice to Debtor. Debtor waives
any right to require that any action be brought against any other person or to
require that resort be had to any other security or to any balance of any
deposit account. The Debtor further waives any right of subrogation or to
enforce any right of action against any other Debtor until the Obligation is
paid in full.
21. OTHER PARTIES AND OTHER COLLATERAL. No renewal or extension of or any
other indulgence with respect to the Obligation or any part thereof, no release
of any security, no release of any person (including any maker, indorser,
guarantor or surety) liable on the Obligation, no delay in enforcement of
payment, and no delay or omission or lack of diligence or care in exercising
any right or power with respect to the Obligation or any security therefor or
guaranty thereof or under this agreement shall in any manner impair or affect
the rights of Bank under the law, hereunder, or under any other agreement
pertaining to the Collateral. Bank need not file suit or assert a claim for
personal judgement against any person for any part of the Obligation or seek to
realize upon any other security for the Obligation, before foreclosing or
otherwise realizing upon the Collateral for the purpose of paying the
Obligation. Debtor waives any right to the benefit of or to require or control
application of any other security or proceeds thereof, and agrees that Bank
shall have no duty or obligation to Debtor to apply to the Obligation any such
other security or proceeds thereof.
22. COLLECTION AND SEGREGATION OF ACCOUNTS. The Bank hereby authorizes the
Debtor to collect the Collateral, subject to the direction and control of the
Bank, but the Bank may, without cause or notice, curtail or terminate said
authority at any time. Upon notice by the Bank, whether oral or in writing, to
the Debtor, the Debtor shall forthwith upon receipt of all checks, drafts, cash,
and other remittances in payment of or on account of the Collateral, deposit the
same in one or more special accounts maintained with the Bank over which the
Bank alone shall have the power of withdrawal. The remittance of the proceeds of
such Collateral shall not, however, constitute payment or liquidation of such
Collateral until the Bank shall receive good funds for such proceeds. Funds
placed in such special accounts shall be held by the Bank as security for all
Obligations secured hereunder. These proceeds shall be deposited in precisely
the form received, except for the indorsement of the Debtor where necessary to
permit collection of items, which endorsement the Debtor agrees to make, and
which indorsement the Bank is also hereby authorized, as attorney-in-fact, to
make on behalf of the Debtor. In the event the Bank has notified the Debtor to
make deposits to a special account, pending such deposit, the Debtor agrees that
it will not commingle any such checks, drafts, cash or other remittances with
any funds or other property of the Debtor, but will hold them separate and apart
therefrom, and upon an express trust for the Bank until deposit thereof is made
in the special account. The Bank will, from time to time, apply the whole or any
part of the Collateral funds on deposit in this special account against such
Obligations as are secured hereby as the Bank may in its sole discretion elect.
At the sole election of the Bank, any portion of said funds on deposit in the
special account which the Bank shall elect not to apply to the Obligations, may
be paid over by the Bank to the Debtor.
23. COMPLIANCE WITH STATE AND FEDERAL LAWS. Debtor will comply with all State
and Federal laws and regulations applicable to its business, whether now in
effect or hereafter enacted including but not limited to the wage and hours
laws and relating to the use or disposal of hazardous materials and wastes.
F. RIGHTS AND POWERS OF BANK
1. GENERAL. Bank, before or after default, without liability to Debtor may:
obtain from any person information regarding Debtor or Debtor's business, which
information any such person also may furnish without liability to Debtor;
require Debtor to give possession or control of any Collateral to Bank; indorse
as Debtor's agent any instruments, documents or chattel paper in Collateral or
representing proceeds of Collateral; contact account debtors directly to verify
information furnished by Debtor; take control of proceeds, including stock
received as dividends or by reason of stock splits; release Collateral in its
possession to any Debtor, temporarily or otherwise; require additional
Collateral; reject as unsatisfactory any property hereafter offered by Debtor
as Collateral; set standards from time to time to govern what may be used as
after acquired Collateral; designate, from time to time, a certain percent of
the Collateral as the loan value and require Debtor to maintain the Obligation
at or below such figure; take control of funds generated by the Collateral,
such as cash dividends, interest and proceeds or refunds from insurance, and
use same to reduce any part of the Obligation and exercise all other rights
which an owner of such Collateral may exercise, except the right to vote or
dispose of Collateral before an event of default; at any time transfer any of
the Collateral or evidence thereof into its own name or that of its nominee;
and demand, collect, convert, redeem, receipt for, settle, compromise, adjust,
xxx for, foreclose or realize upon Collateral, in its own name or in the name
of Debtor, as Bank may determine. Bank shall not be liable for failure to
collect any account or instruments, or for any act or omission on the part of
the Bank, its officers, agents or employees, except willful misconduct and
gross negligence. The foregoing rights and powers of Bank will be in addition
to, not a limitation upon, any rights and powers of Bank given by law,
elsewhere in this agreement, or otherwise. If Debtor fails to maintain any
required insurance, to the extent permitted by applicable law Bank may (but is
not obligated to) purchase single interest insurance coverage for the
Collateral which insurance may at Bank's option (i) protect only Bank and not
provide any remuneration or protection for Debtor directly and (ii) provide
coverage only after the Obligation has been declared due as herein provided.
The premiums for any such insurance purchased by Bank shall be a part of the
Obligation and shall bear interest as provided in B.1.d hereof.
2. CONVERTIBLE COLLATERAL. Bank, may present for conversion any Collateral
which is convertible into any other instrument or investment security or a
combination thereof with cash, but Bank shall not have any duty to present for
conversion any Collateral unless it shall have received from Debtor detailed
written instructions to that effect at a time reasonably far in advance of the
final conversion date to make such conversion possible.
G. DEFAULT
1. EVENT OF DEFAULT. An event of default shall occur if: (i) there is a
loss, theft, damage or destruction of any material portion of the Collateral
for which there is no insurance coverage or for which, in the opinion of the
Bank there is insufficient insurance coverage; or (ii) if Debtor or any other
obligor on the Obligation shall fail to timely and properly pay or observe,
keep or perform any term, covenant, agreement or condition in this agreement or
in any other agreement between Debtor and any other obligor on the Obligation,
including in any other note or instrument, loan agreement, security agreement,
deed of trust, mortgage, promissory note, assignment or other agreement or
instrument concerning the Obligation.
2. RIGHTS AND REMEDIES. If any Event of Default shall occur, then, in each
and every such case, the Bank may, without presentment, demand, or protest;
notice of default, dishonor, demand, non-payment, or protest; notice of intent
to accelerate all or any part of the Obligation; notice of acceleration of all
or any part of the Obligation; or notice of any other kind, all of which Debtor
hereby expressly waives, (except for any notice required under this agreement,
any other loan document or applicable law); at any time thereafter exercise
and/or enforce any of the following rights and remedies:
a) POSSESSION AND COLLECTION OF COLLATERAL. At its option: (i) take
possession or control of, store, lease, operate, manage, sell or otherwise
dispose of, all or any part of the Collateral; (ii) notify all parties under any
account or contract right forming all or any part of the Collateral to make any
payments otherwise due to the Debtor directly to the Bank; (iii) in the Bank's
own name, or in the name of the Debtor, demand, collect, receive, xxx for, and
give receipts and releases for, any and all amounts due under such accounts and
contract rights; (iv) indorse as the agent of the Debtor any check, note,
chattel paper, documents, or instruments forming all or any part of the
Collateral; (v) make formal application for transfer to the Bank (or to any
assignee of the Bank to any purchaser of any of the Collateral) of all of the
Debtor's permits, licenses, approvals, agreements, and the like relating to the
Collateral or to the Debtor's business; (vi) take any other action which the
Bank deems necessary or desirable to protect and realize upon its security
interest in the Collateral; and (vii) in addition to the foregoing, and not in
substitution therefor, exercise any one or more of the rights and remedies
exerciseable by the Bank under any other provision of this agreement, under any
of the other loan documents, or as provided by applicable law (including,
without limitation, the Uniform Commercial Code as in effect in North Carolina
(hereinafter referred to as the "UCC")). In taking possession of the Collateral
the Bank may enter the Debtor's promises and otherwise proceed without legal
process, if this can be done without breach of the peace. The Debtor shall, upon
the Bank's demand, promptly make the Collateral or other security available to
the Bank at a place designated by the Bank, which place shall be reasonably
deemed convenient to both parties.
The Bank shall not be liable for, nor be prejudiced by, any loss, depreciation
or other damages to the Collateral, unless caused by the Bank's willful and
malicious act. The Bank shall have no duty to take any action to preserve or
collect the Collateral.
b) RECEIVER. Obtain the appointment of a receiver for all or any of the
Collateral, the Debtor hereby consenting to the appointment of such a receiver
and agreeing not to oppose any such appointment.
c) RIGHT OF SET OFF. Without notice or demand to the Debtor, set off and
apply against any and all of the Obligations any and all deposits (general or
special, time or demand, provisional or final) and any other indebtedness, at
any time held or owing by the Bank to or for the credit of the account of the
Debtor.
Bank shall be entitled to immediate possession of all books and records
evidencing any Collateral or pertaining to chattel paper covered by this
agreement and it or its representatives shall have the authority to enter upon
any premises upon which any of the same, or any Collateral, may be situated and
remove the same therefrom without liability. Bank may surrender any insurance
policies in Collateral and receive the unearned premium thereon. Debtor shall
be entitled to any surplus and shall be liable to Bank for any deficiency. The
proceeds of any disposition after default available to satisfy the Obligation
shall be applied to the Obligation in such order and in such manner as Bank in
its discretion shall decide.
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H. GENERAL
1. PARTIES BOUND. Bank's rights hereunder shall inure to the benefit of its
successors and assigns, and in the event of any assignment or transfer of any
of the Obligation or the Collateral, Bank thereafter shall be fully discharged
from any responsibility with respect to the Collateral so assigned or
transferred, but Bank shall retain all rights and powers hereby given with
respect to any of the Obligation or Collateral not so assigned or transferred.
All representations, warranties and agreements of Debtor if more than one are
joint and several and all shall be binding upon the personal representatives,
heirs, successors and assigns of Debtor.
2. WAIVER. No delay of Bank in exercising any power or right shall operate as
a waiver thereof; nor shall any single or partial exercise of any power or right
preclude other or further exercise thereof or the exercise of any other power or
right. No waiver by Bank of any right hereunder or of any default by Debtor
shall be binding upon Bank unless in writing, and no failure by Bank to exercise
any power or right hereunder or waiver of any default by Debtor shall operate as
a waiver of any other or further exercise of such right or power or of any
further default. Each right, power and remedy of the Bank as provided for in any
of the loan documents, or which shall now or hereafter exist at law or in equity
or by statute or otherwise, shall be cumulative and concurrent and shall be in
addition to every other such right, power or remedy. The exercise or beginning
of the exercise by the Bank of any one or more of such rights, powers or
remedies shall not preclude the simultaneous or later exercise by the Bank of
any or all other such rights, powers or remedies.
3. AGREEMENT CONTINUING. This agreement shall constitute a continuing
agreement, applying to all future as well as existing transactions, whether or
not of the character contemplated at the date of this agreement, and if all
transactions between Bank and Debtor shall be closed at any time, shall be
equally applicable to any new transactions thereafter. Provisions of this
agreement, unless by their terms exclusive, shall be in addition to other
agreements between the parties. Time is of the essence of this agreement.
4. DEFINITIONS. Unless the context indicates otherwise, definitions in the
UCC apply to words and phrases in this agreement; if UCC definitions conflict,
Article 9 definitions apply.
5. NOTICE. Notice shall be deemed reasonable if mailed postage prepaid at
least 5 days before the related action (or if the UCC elsewhere specifies a
longer period, such longer period) to the address of Debtor given above.
6. MODIFICATIONS. No provision hereof shall be modified or limited except by
a written agreement expressly referring hereto and to the provisions so
modified or limited and signed by the Debtor and Bank, nor by course of
conduct, usage of trade.
7. PARTIAL INVALIDITY. The unenforceability or invalidity of any provision
of this security agreement shall not affect the enforceability or validity of
any other provision herein and the invalidity or unenforceability of any
provision of any loan document to any person or circumstance shall not affect
the enforceability or validity of such provision as it may apply to other
persons or circumstances.
8. GENDER AND NUMBER. Where appropriate, the use of one gender shall be
construed to include the others or any of them; and the singular number shall
be construed to include the plural, and vice versa.
9. APPLICABLE LAW AND VENUE. This agreement has been delivered in the State
of North Carolina and shall be construed in accordance with the laws of that
State. It is performable by Debtor in the county or city of Bank's address set
out above and Debtor expressly waives any objection as to venue in any such
location. Wherever possible each provision of this agreement shall be
interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this agreement shall be prohibited by or invalid under
applicable law, such provision shall be ineffective to the extent of such
prohibition or invalidity, without invalidating the remainder of such
provisions or the remaining provisions of this agreement.
10. FINANCING STATEMENT. To the extent permitted by applicable law, a carbon,
photographic or other reproduction of this security agreement or any financing
statement covering the Collateral shall be sufficient as a financing statement.
11. COUNTERPARTS. This agreement may be executed in any number of
counterparts, each of which shall be considered to be an original, but all of
which shall constitute one in the same instrument. As used herein "this
agreement" shall include all attachments and addends.
12. ARBITRATION. ANY CONTROVERSY OR CLAIM BETWEEN OR AMONG THE PARTIES HERETO
INCLUDING BUT NOT LIMITED TO THOSE ARISING OUT OF OR RELATING TO THIS AGREEMENT
OR ANY RELATED AGREEMENTS OR INSTRUMENTS, INCLUDING ANY CLAIM BASED ON OR
ARISING FROM AN ALLEGED TORT, SHALL BE DETERMINED BY BINDING ARBITRATION IN
ACCORDANCE WITH THE FEDERAL ARBITRATION ACT (OR IF NOT APPLICABLE, THE
APPLICABLE STATE LAW), THE RULES OF PRACTICE AND PROCEDURE FOR THE ARBITRATION
OF COMMERCIAL DISPUTES OF JUDICIAL ARBITRATION AND MEDIATION SERVICES, INC.
(J.A.M.S.) AND THE "SPECIAL RULES" SET FORTH BELOW. IN THE EVENT OF ANY
INCONSISTENCY, THE SPECIAL RULES SHALL CONTROL. JUDGMENT UPON ANY ARBITRATION
AWARD MAY BE ENTERED IN ANY COURT HAVING JURISDICTION. ANY PARTY TO THIS
AGREEMENT MAY BRING AN ACTION, INCLUDING A SUMMARY OR EXPEDITED PROCEEDING, TO
COMPEL ARBITRATION OF ANY CONTROVERSY OR CLAIM TO WHICH THIS AGREEMENT APPLIES
IN ANY COURT HAVING JURISDICTION OVER SUCH ACTION.
A. SPECIAL RULES. THE ARBITRATION SHALL BE CONDUCTED IN THE CITY OF THE
BORROWER'S DOMICILE AT THE TIME OF THIS AGREEMENT'S EXECUTION AND ADMINISTERED
BY J.A.M.S. WHO WILL APPOINT AN ARBITRATOR; IF J.A.M.S. IS UNABLE OR LEGALLY
PRECLUDED FROM ADMINISTERING THE ARBITRATION, THEN THE AMERICAN ARBITRATION
ASSOCIATION WILL SERVE. ALL ARBITRATION HEARINGS WILL BE COMMENCED WITHIN 90
DAYS OF THE DEMAND FOR ARBITRATION; FURTHER, THE ARBITRATOR SHALL ONLY, UPON A
SHOWING OF CAUSE, BE PERMITTED TO EXTEND THE COMMENCEMENT OF SUCH HEARING FOR UP
TO AN ADDITIONAL 60 DAYS.
B. RESERVATIONS OF RIGHTS. NOTHING IN THIS AGREEMENT SHALL BE DEEMED TO (I)
LIMIT THE APPLICABILITY OF ANY OTHERWISE APPLICABLE STATUTES OF LIMITATION OR
REPOSE AND ANY WAIVERS CONTAINED IN THIS AGREEMENT; OR (II) BE A WAIVER BY THE
BANK OF THE PROTECTION AFFORDED TO IT BY 12 U.S.C. SEC. 91 OR ANY SUBSTANTIALLY
EQUIVALENT STATE LAW; OR (III) LIMIT THE RIGHT OF THE BANK HERETO (A) TO
EXERCISE SELF HELP REMEDIES SUCH AS (BUT NOT LIMITED TO) SETOFF, OR (B) TO
FORECLOSE AGAINST ANY REAL OR PERSONAL PROPERTY COLLATERAL, OR (C) TO OBTAIN
FROM A COURT PROVISIONAL OR ANCILLARY REMEDIES SUCH AS (BUT NOT LIMITED TO)
INJUNCTIVE RELIEF, WRIT OF POSSESSION OR THE APPOINTMENT OF A RECEIVER. THE BANK
MAY EXERCISE SUCH SELF HELP RIGHTS, FORECLOSE UPON SUCH PROPERTY, OR OBTAIN
SUCH PROVISIONAL OR ANCILLARY REMEDIES BEFORE, DURING OR AFTER THE PENDENCY OF
ANY ARBITRATION PROCEEDING BROUGHT PURSUANT TO THIS AGREEMENT. AT BANK'S
OPTION, FORECLOSURE UNDER A DEED OF TRUST OR MORTGAGE MAY BE ACCOMPLISHED BY
ANY OF THE FOLLOWING: THE EXERCISE OF A POWER OF SALE UNDER THE DEED OF TRUST
OR MORTGAGE, OR BY JUDICIAL SALE UNDER THE DEED OF TRUST OR MORTGAGE, OR BY
JUDICIAL FORECLOSURE. NEITHER THIS EXERCISE OR SELF HELP REMEDIES NOR THE
INSTITUTION OR MAINTENANCE OF AN ACTION FOR FORECLOSURE OR PROVISIONAL OR
ANCILLARY REMEDIES SHALL CONSTITUTE A WAIVER OF THE RIGHT OF ANY PARTY,
INCLUDING THE CLAIMANT IN ANY SUCH ACTION, TO ARBITRATE THE MERITS OF THE
CONTROVERSY OR CLAIM OCCASIONING RESORT TO SUCH REMEDIES. DEBTOR AGREES THAT
BANK AT ITS SOLE OPTION MAY CHOOSE MEDIATION, AND/OR BINDING ARBITRATION
PROCEDURES PERTAINING TO ANY CONTROVERSY(IES) OR DISPUTE(S) ARISING BETWEEN
DEBTOR AND BANK. DEBTOR AGREES TO ABIDE BY THE SELECTION THAT BANK MAKES TO
RESOLVE ANY CONFLICTS OR DISPUTES BETWEEN DEBTOR AND BANK AND TO PARTICIPATE IN
THE MEDIATION AND/OR BINDING ARBITRATION PROCESS IF SELECTED. DEBTOR AND BANK
AGREE THAT EACH WILL BEAR THEIR PORTION OF EXPENSES RELATED TO MEDIATION AND/OR
BIDING ARBITRATION.
13. NOTICE OF FINAL AGREEMENT. THIS WRITTEN AGREEMENT AND THE OTHER LOAN
DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN OR ORAL AGREEMENTS BETWEEN
THE PARTIES.
IN WITNESS WHEREOF, the parties hereto have caused this agreement to be duly
executed under seal by their duly authorized representatives as of the date
first above written.
BANK/SECURED PARTY: DEBTOR/PLEDGOR:
NATIONSBANK, N.A. (CAROLINAS)
By: /s/ XXXXX X. XXXXXXX (Seal) American Aircarriers Support, Inc.
----------------------------
Xxxxx X. Xxxxxxx
Vice President
ATTEST:
/s/ XXXX X. XXXXXX, SEC. By: /s/ XXXX X. XXXXX (Seal)
-------------------------------- -------------------------
Xxxx X. Xxxxx
President
