SECURITY AGREEMENT
M&A West, Inc. of 0000 Xxxxxxxx, Xxxxxxx, Xxxxx 00000, hereinafter called
"Debtor", and Realtec Ltd., __________________, hereinafter called "Secured
Party", agree as follows:
Section I. Creation of Security Interest.
1.1 Debtor hereby pledges, grants a security interest in mortgages,
assigns, transfers, delivers,, sets over and confirms unto Secured Party the
Collateral described in Section II of this Agreement to secure performance and
payment of all debts, obligations and liabilities of every kind and character of
Debtor now or hereafter existing in writing in favor of Secured Party,
including, but not limited to, (1) that certain promissory note (the "Note" or
"Promissory Note") in the principal amount of $250,000 dated January 25, 2001
attached hereto as Exhibit "A"; (2) future advances to be evidenced by like
notes to be made by Secured Party to Debtor at Secured Party's Option; and (3)
all liabilities of Debtor to Secured Party now existing or later incurred,
matured or unmatured, direct or contingent, and any renewals and extensions of,
and substitutions for, such liabilities. All such indebtedness is hereinafter
sometimes called the "secured indebtedness" or the "indebtedness secured
hereby."
Section II. Collateral.
2.1 The Collateral of this Security Agreement consists of One Million
Five Hundred Thousand (1,500,000) shares of Digital Bridge, Inc. ("Digital")
duly issued to Debtor, and all other property previously, presently or in the
future deposited with Vanderkam & Xxxxxxx, as escrow agent for Secured Party, by
Debtor. Upon the execution of this Agreement, Debtor will have a share
certificate delivered to Secured Party as well as an irrevocable stock power.
The Collateral includes also, without limitation, all property this day
delivered to and deposited with Secured Party, and all money and property of the
Debtor heretofore delivered to or to come into the possession, custody or
control of Secured Party in any manner or for any purpose whatever during the
existence of this Agreement, and whether held in a general or special account,
or deposited for safekeeping or otherwise, together with all dividends (cash or
otherwise), rights to receive dividends, stock dividends, dividends paid in
stock, distributions upon redemption or liquidation, distributions as a result
of split-ups, recapitalizations or rearrangements, all stock rights, rights to
subscribe, voting rights, rights to receive securities, and all new securities;
and all other property which Debtor may hereafter become entitled to receive on
account of such securities or other property, and in the event Debtor receives
any such property, Debtor will immediately deliver same to Secured Party to be
held by Secured Party in the same manner as the property originally deposited as
Collateral. The Collateral of this Agreement also includes (i) the proceeds of
any and all property described above and (ii) any and all cash dividends of and
from any and all property described above.
Section III. Payment Obligations of Debtor.
3.1 Debtor shall pay to Secured Party any sum or sums due or which may
become due pursuant to any instrument or agreement evidencing any indebtedness
or obligation of Debtor to Secured Party, now or hereafter executed by Debtor,
in accordance with the terms of such instrument or agreement and the terms of
this Agreement.
3.2 Debtor shall pay to Secured Party on demand all expenses and
expenditures, including reasonable attorneys' fees and other legal expenses
incurred or paid by Secured Party in exercising or protecting its interests,
rights and remedies under this Security Agreement, plus interest thereon from
date of expenditure until paid at the maximum nonusurious rate from time to time
permitted by applicable law (the "Highest Lawful Rate").
3.3 Debtor shall pay the entire unpaid indebtedness of Debtor to
Secured Party, whether created or incurred pursuant to this Agreement or
otherwise, upon Debtor's default under this Agreement.
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Section IV. Representations and Warranties.
4.1 Debtor represents and warrants that:
(a) All information, reports, statements and other data furnished by Debtor
to Secured Party prior to, contemporaneously with or subsequent to the
execution of this Security Agreement or in connection with the
indebtedness secured hereby are and shall be true, correct and complete
and do not and shall not omit to state any fact or circumstance
necessary to make the information contained therein not misleading.
(b) All investment securities and any like property delivered to Secured
Party as Collateral are genuine, duly and validly authorized and
issued, fully paid and nonassessable, free of all liens, claims,
demands, equities or other security interests, and are hereby duly and
validly pledged and hypothecated to Secured Party in accordance with
law.
(c) Debtor owns the Collateral and has the right to pledge the same and to
transfer any interest therein; all consents required for the pledge of
the Collateral herein provided have been obtained; the Collateral is
free and clear from all security interests and encumbrances except the
security interest evidenced hereby; there is no financing statement
covering the Collateral or its proceeds on file in any public office;
and so long as the indebtedness secured hereby remains unpaid the
Debtor will warrant and defend the title to the Collateral and its
proceeds against the claims and demands of all persons whomsoever
claiming or to claim the same or any party thereof.
(d) The execution, delivery and performance by Debtor of this Agreement
does not and will not contravene or violate any provision of any law,
rule, regulation, order, writ, judgment, injunction, decree,
determination or award presently in effect and applicable to Debtor or
result in a breach of or constitute a default (with or without the
giving of notice or the lapse of time or both) under any indenture or
loan, credit or other agreement to which Debtor is a party or by which
Debtor or any of Debtor's property may be bound or affected.
(e) This Agreement constitutes the legal, valid and binding obligation of
Debtor enforceable against Debtor in accordance with its terms.
(f) No authorization, consent, approval, license, order or exemption of, or
filing or registration with, any court or governmental department,
commission, board, bureau, agency or instrumentality, domestic or
foreign, is or will be necessary to the valid execution deliver or
performance by Debtor of this Agreement or to the enforcement hereof by
Secured Party.
(g) No representation or warranty contained herein or made in connection
with the indebtedness secured hereby, and no certificate, schedule or
other document furnished in connection herewith, contains or will
contain, at the time so made or furnished, a misstatement of material
fact or omits or will omit to state a material fact required to be
stated therein in order to make the statements contained therein not
misleading.
Section V. Covenants.
5.1 Debtor covenants and agrees during the term of this Agreement with
Secured Party as follows:
(a) Debtor shall furnish to Secured Party such stock powers and other
instruments as may be required by Secured Party to assure the
transferability of the Collateral when and as often as may be requested
by Secured Party.
(b) Debtor will cause to be paid prior to delinquency all taxes and
assessments heretofore or hereafter levied or assessed against the
Collateral, or any part thereof, or against the Secured Party for or on
account of the indebtedness secured hereby or the interest created by
this Agreement, and will furnish Secured Party with receipts or other
satisfactory evidence showing payment of such taxes and assessments at
least ten (10) days prior to the applicable default date therefore.
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(c) If the validity or priority of this Agreement or of any rights, titles,
security interests or other interests created or evidenced hereby shall be
attacked, endangered or questioned, or if any legal proceedings are
instituted with respect thereto, Debtor will give prompt written notice
thereof to Secured Party and, at Debtor's own cost and expense, will
diligently endeavor to cure any legitimate defect that may be developed or
claimed, and will take all necessary and proper steps for the defense of
such legal proceedings, and Secured Party (whether or not named as a party)
is hereby authorized and empowered to take such additional steps as in its
judgment and discretion may be necessary or proper for the defense of any
such legal proceedings or the protection of the validity or priority of
this Agreement and the rights, titles, security interests and other
interest created or evidenced hereby, and all expenses so incurred of every
kind and character shall be a demand obligation owing by Debtor and shall
bear interest from date of expenditure until paid at the Highest Lawful
Rate.
(d) Debtor will, on request of Secured Party, (i) promptly correct any obvious
clerical defect, error or omission which may be discovered in the contents
of this Agreement or in any other instrument executed in connection
herewith or in the execution or acknowledgment thereof; (ii) execute,
acknowledge and deliver to Secured Party such further instruments
(including without limitation further security agreements, financing
statements and continuation statements) and do such further acts as may be
necessary, desirable or proper to carry out more effectively the purposes
of this Agreement and such other instruments and to subject to the security
interests hereof and thereof any property intended by the terms hereof and
thereof to be covered hereby and thereby, including specifically, but
without limitation, any renewals, additions, substitutions, replacements or
appurtenances to the then Collateral; and (iii) execute, acknowledge and
deliver to Secured Party any document or instrument (including specifically
any financing statement) deemed advisable by Secured Party to protect the
security interest hereunder against the rights or interest of third
persons, and Debtor will pay all costs connected with any of the foregoing.
(e) Notwithstanding the security interest in proceeds granted herein, Debtor
will not sell, exchange, lend, assign, transfer or otherwise dispose of all
or any part of the Collateral or any interest therein, or permit any of the
foregoing, without the prior written consent of the Secured Party.
(f) Debtor will pay all filing fees incurred by Secured Party in connection
with the secured indebtedness, and will reimburse Secured Party for all
such expenses incurred by it. Debtor shall pay all expenses and attorney's
fees and legal expenses, incurred or expended in connection with Secured
Party's exercise of any of its rights and remedies hereunder or Secured
Party's protection of the Collateral and its security interest therein. Any
amount to be paid hereunder by Debtor to Secured Party shall be a demand
obligation owing by Debtor to Secured Party and shall bear interest from
date of expenditure until paid at the Highest Lawful Rate.
(g) Debtor shall account fully and faithfully for and, if Secured Party so
elects, shall promptly pay or turn over to Secured Party the proceeds in
whatever form received from disposition in any manner of any of the
Collateral, whether the indebtedness secured hereby is mature or not.
Debtor shall at all times keep the Collateral and its proceeds separate and
distinct from other property of Debtor and shall keep accurate and complete
records of the Collateral and its proceeds.
(h) Debtor shall furnish Secured Party all such information as Secured Party
may reasonably request with respect to the Collateral.
5.2 Debtor agrees that, if Debtor fails to perform any act or to take any
action which hereunder Debtor is required to perform or take, or to pay any
money which hereunder Debtor is required to pay, Secured Party, in Debtor's name
or in its own name, may but shall not be obligated to perform or cause to be
performed such act or take such action or pay such money, and any expenses so
incurred by Secured Party, and any money so paid by Secured Party, shall be a
demand obligation owing by Debtor to Secured Party and Secured Party upon making
such payment, shall be subrogated to all of the rights of the person,
corporation or other entity receiving such payment. Any amounts due and owing by
Debtor to Secured Party pursuant to this Agreement shall bear interest from the
date such amount is expended by Secured Party until paid at the Highest Lawful
Rate and shall be a part of the secured indebtedness and shall be secured by
this Agreement and by any other instrument securing the secured indebtedness.
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Section VI. Events of Default.
6.1 Debtor shall be in default under this Agreement upon the occurrence
of any Event of Default (as such term is defined in the Promissory Note) or the
happening of any of the following events or conditions (hereinafter called
"Event of Default"):
(a) Debtor shall fail to pay any principal of or interest on the Note
or any other indebtedness secured hereby as and when due; or
(b) Debtor shall fail to pay at maturity, or within any applicable period
of grace, any principal of or interest on any other obligation or shall
fail to observe or perform any term, covenant or agreement contained in
any agreement or obligation by which Debtor is bound for such a period
of time as would accelerate, or would permit the holder thereof to
accelerate the maturity thereof; or
(c) Debtor shall be determined by a court of competent jurisdiction to be
in default under or in violation of any law, statute, ordinance,
decree, requirement, order, judgment, rule or regulation (or
interpretation of any of the foregoing) of the United States of
America, any State of the United States or any political subdivision of
any of the foregoing or of any agency, department, commission, board,
bureau or court having jurisdiction over Debtor, or its respective
assets or property; or
(d) Any representation or warranty made in connection with the execution
and delivery of this Agreement, the Note evidencing the indebtedness
secured hereby or any other instrument now or hereafter securing the
indebtedness shall prove to have been incorrect, false or misleading on
the date as of which made; or
(e) Debtor or any other person shall fail to perform any covenant contained
in the Note evidencing the indebtedness secured hereby, this Agreement
or in any other instrument now or hereafter securing or guaranteeing
the indebtedness secured hereby; or
(f) Debtor or any other person shall claim, or any court shall find or
rule, that Secured Party does not have a valid lien on any security
which may have been provided by Debtor or such other person for the
indebtedness secured hereby; or
(g) The sale, encumbrances or abandonment (except as otherwise expressly
permitted by this Agreement or the Note) of any property now or
hereafter covered by this Agreement or any other instrument now or
hereafter securing the indebtedness secured hereby; or the making of
any levy, seizure or attachment thereof or thereon; or the loss, theft,
substantial damage or destruction of any of such property; or
(h) The occurrence of an Event of Default under any other instrument now or
hereafter securing or guaranteeing the indebtedness secured hereby.
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Section VII. Remedies In Event of Default.
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7.1 Upon the occurrence of an Event of Default, and at any time
thereafter, Secured Party shall have the option of declaring, without notice to
any person, all indebtedness secured hereby, principal and accrued interest, to
be immediately due and payable.
7.2 Upon the occurrence of an Event of Default, and at any time
thereafter, Secured Party may, without notice except hereinafter provided, sell
the Collateral or any part thereof at public or private sale or at any broker's
board or on any securities exchange for cash, upon credit, or for future
delivery, and at such price or prices as Secured Party may deem best, and
Secured Party may be the purchaser of any and all of the Collateral so sold and
may apply upon the purchase price therefor to any indebtedness secured hereby or
any part thereof and thereafter hold the same absolutely free from any right or
claim of whatsoever kind. Upon any such sale Secured Party shall have the right
to deliver, assign and transfer tot he broker or purchaser thereof the
Collateral. Each purchaser at any such sale shall hold the property sold
absolutely free from any claim or right of whatsoever kind, including any equity
or right of redemption, stay or appraisal which Debtor has or may have under any
rule of law or statute now existing or hereafter adopted. Secured Party shall
give Debtor ten (10) days written notice mailed to Debtor at the address set
forth herein (which shall satisfy any requirement of notice or reasonable notice
in any applicable statute) of Secured Party's intention to make any such public
or private sale. Such notice, in case of public sale, shall state the time and
place fixed for such sale, and in case of sale at broker's board or on a
securities exchange, shall state the board or exchange at which such sale is to
be made and the day on which the Collateral or that portion thereof so being
sold will first be offered for sale at such board or exchange. Any such public
sale shall be held at such time or times, within the ordinary business hours and
at such place or places, as Secured Party may fix in the notice of such sale. At
any sale the Collateral may be sold in one lot as an entirety or in separate
parcels as Secured Party may determine. Secured Party shall not be obligated to
make any sale pursuant to any such notice. Secured Party may, without notice or
publication, adjourn any public or private sale or cause the same to be
adjourned from time to time by announcement at any time and place fixed for the
sale, and such sale may be made at any time or place to which the same may be so
adjourned; provided, however that Secured Party shall give Debtor ten (10) days
written notice of the time and place of any such adjourned sale. In case of any
sale of all or any part of the Collateral on credit or for future delivery, the
Collateral so sold shall be retained by Secured Party until the selling price is
paid by the purchaser thereof, but Secured Party shall incur no liability in
case of the failure of such purchaser to take up and pay for the Collateral so
sold, and in case of any such failure, such Collateral may again be sold upon
like notice. Each and every method of disposition described in this Section
shall constitute disposition in a commercially reasonable manner. Debtor shall
remain liable for any deficiency. Notwithstanding anything to the contrary
contained herein because of the federal Securities Act of 1933, as amended, or
any other applicable laws or regulations, there may be legal restrictions or
limitations affecting Secured Party's ability to dispose of certain portions of
the Collateral in the enforcement of its rights and remedies hereunder. For
these reasons, Secured Party is hereby authorized by Debtor, but not obligated,
upon the occurrence of any Event of Default, to sell all or any part of the
Collateral at one or more private sales, restricting the prospective bidders or
purchasers to persons who will represent and agree that they are purchasing the
Collateral for their own account or investment and not with a view to the
distribution or resale of any of the Collateral or in any manner which will not
require the Collateral, or any part thereof, to be registered in accordance with
the Securities Act of 1933, as amended, the rules and regulations promulgated
thereunder, or any other law or regulation, at the best price reasonably
obtainable by Secured Party at any such private sale or other disposition of any
of the Collateral. Debtor clearly understands that Secured Party may in its
discretion approach a restricted number of potential purchasers and that a sale
under such circumstances may yield a lower price for the Collateral, or any part
or parts thereof, than would otherwise be obtainable if same were registered in
the open market. Debtor agrees (i) that in the event Secured Party shall, upon
the occurrence of any Event of Default, sell the Collateral, or any portion
thereof, at such private sale or sales, Secured Party shall have the right to
rely upon the advice and opinion of any member firm of a national securities
exchange as to the best price reasonably obtainable upon such a private sale
thereof, and (ii) in the absence of fraud, that such reliance shall be
conclusive evidence that Secured Party disposed of the Collateral in a
commercially reasonable manner under the Uniform Commercial Code of Texas.
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7.3 Upon the occurrence of an Event of Default, and at any time
thereafter, Secured Party shall have all the rights of a secured party after
default under the Uniform Commercial Code of Texas, and in conjunction with, and
in addition to those rights; and
(a) written notice mailed to Debtor as provided herein ten (10) days prior
to the date of public sale of the Collateral or prior to the date after
which private sale of the Collateral will be made shall constitute
reasonable notice; and
(b) it shall not be necessary that the Collateral or any part thereof
be present at the location of such sale; and
(c) prior to the application of the proceeds of any disposition of the
Collateral to the secured indebtedness, such proceeds shall be applied
to the expenses of retaking, holding, preparing for sale or lease,
selling, leasing and the like and the attorneys' fees and legal
expenses incurred by the Secured Party, Debtor to remain liable for any
deficiency; and
(d) the sale by Secured Party of less than the whole of the Collateral
shall not exhaust the rights of Secured Party hereunder, and Secured
Party is specifically empowered to make successive sale or sales
hereunder until the whole of the Collateral shall be sold; and, if the
proceeds of such sale of less than the whole of the Collateral shall be
less than the aggregate of the indebtedness security hereby, this
Agreement and the security interest created shall hereby remain in full
force and effect as to the unsold portion of the Collateral just as
though no sale had been made;
(e) in the event any sale hereunder is not completed or is defective in the
opinion of Secured Party, such sale shall not exhaust the rights of
Secured Party hereunder and Secured Party shall have the right to cause
a subsequent sale or sales to be made hereunder; and
(f) any and all statements of fact or other recitals made in any xxxx of
sale or assignment or other instrument evidencing any foreclosure sale
hereunder as to nonpayment of the indebtedness or as to the occurrence
of any default, or as to Secured Party having declared all of such
indebtedness is due and payable, or as to notice of time, place and
terms of sale and the properties to be sold having been duly given, as
to any other thing having been duly done by Secured Party, shall be
taken as prima facie evidence of the truth of the facts so stated and
recited; and
(g) Secured Party may appoint or delegate any one or more persons as agent
to perform any act or acts necessary or incident to any sale held by
Secured Party, including the sending of notices and the conduct of
sale, but in the name and on behalf of Secured Party.
7.4 All remedies herein expressly provided for are cumulative of any
and all other remedies existing at law or in equity and are cumulative of any
and all other remedies provided for in any other instrument securing the payment
of the secured indebtedness, or any part thereof, or otherwise benefitting
Secured Party, and the resort to any remedy provided for by law shall not
prevent the concurrent or subsequent employment of any other appropriate remedy
or remedies.
7.5 Secured Party may resort to any security given by this Agreement or
to any other security now existing or hereafter given to secure the payment of
the secured indebtedness, in whole or in part, and in such portions and in such
order as may seem best to Secured Party in its sole and uncontrolled discretion,
and any such action shall not in any way be considered as a waiver of any of the
rights, benefits or security interests evidenced by this Agreement.
7.6 Secured Party may at any time cause any or all of the Collateral to
be transferred into its name or into the name or names of any nominee or
nominees of Secured Party; provided, however, any such nominee shall have no
greater rights to the Collateral granted to Secured Party herein.
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Section VIII. Additional Agreements.
8.1 If all of the secured indebtedness is paid as the same becomes due
and payable, and if all of the covenants, warranties, undertakings and
agreements made in this Agreement are kept and performed, then and in that event
only, all rights under this Agreement shall terminate and the Collateral shall
become wholly clear of the security interest evidenced hereby, and such security
interest shall be released by Secured Party in due form at Debtor's cost.
8.2 Secured Party may waive any default without waiving any other prior
or subsequent default. Secured Party may remedy any default without waiving the
default remedied. The failure by Secured Party to exercise any right, power or
remedy upon any default shall not be construed as a waiver of such default or as
a waiver of the right to exercise any such right, power or remedy at a later
date. No single or partial exercise by Secured Party of any right, power or
remedy hereunder shall exhaust the same or shall preclude any other or further
exercise thereof, and every such right, power or remedy hereunder may be
exercised at any time and from time to time. No modification or waiver of any
provision hereof nor consent to any departure by Debtor therefrom shall in any
event be effective unless the same shall be in writing and signed by Secured
Party and then such waiver or consent shall be effective only in the specific
instances, for the purpose for which given and to the extent therein specified.
No notice to nor demand on Debtor in any case shall of itself entitle Debtor to
any other or further notice of demand in similar or other circumstances.
Acceptance by Secured Party of any payment in amount less than the amount then
due on any secured indebtedness shall be deemed an acceptance on account only
and shall not in any way affect the existence of a default hereunder.
8.3 Secured Party may at any time and from time to time in writing (a)
waive compliance by Debtor with any covenant herein made by Debtor to the extent
and in the manner specified in such writing; (b) consent to Debtor doing any act
which hereunder Debtor is prohibited from doing, or consent to Debtor failing to
do any act which hereunder Debtor is required to do, to the extent and in the
manner specified in such writing; (c) release any part of the Collateral, or any
interest therein from the security interest of this Agreement, or (d) release
any party liable, either directly or indirectly, from the secured indebtedness
or from any covenant herein or in any other instrument now or hereafter securing
the payment of the secured indebtedness. No such act shall in any way impair the
rights of Secured Party hereunder or impair or release the liability of any
party except to the extent specifically agreed to by Secured Party in such
writing.
8.4 Any notice, request, demand or other communication required or
permitted hereunder shall be given in writing by delivering same in person to
the intended addressee, or by United States Postal Service, postage prepaid,
registered or certified mail, return receipt requested, or by prepaid telegram
(provided that such telegram is confirmed by mail in the manner previously
described), sent to the intended addressee at the address shown in this
Agreement, or to such different address as the addressee shall have designated
by written notice sent in accordance herewith and actually received by the other
party at least ten (10) days in advance of the date upon which such change of
address shall be effective.
8.5 This Agreement shall be binding upon Debtor, and the heirs,
devisees, administrators, executors, personal representatives, receivers,
trustees, successors and assigns of Debtor, including all successors in interest
of Debtor in and to all or any part of the Collateral, and shall inure to the
benefit of Secured Party and the successors and assigns of Secured Party. All
references in this Agreement to Debtor or Secured Party shall be deemed to
include all such parties.
8.6 Secured Party in its discretion may, whether or not any of the
indebtedness secured hereby be due, in its name or in the name of Debtor or
otherwise, demand, xxx for, collect or receive any money or other property at
any time payable or receivable on account of or in exchange for, or make any
compromise settlement deemed desirable with respect to, any of the Collateral,
but Secured Party shall be under no obligation to do so.
8.7 Whenever possible each provision of this Agreement shall be
interpreted in a manner as to be effective and valid. A determination that any
provision of this Agreement in unenforceable or invalid shall not affect the
enforceability or validity of any other provision, and any determination that
the application of any provision of this Agreement to any person or circumstance
is illegal and unenforceable shall not affect the enforceability or validity of
such provision as it may apply to other persons or circumstances.
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8.8 Secured Party, may by any employee or employees it designates,
execute, sign, endorse, transfer, or deliver in the name of Debtor, notes,
checks, drafts or other instruments for the payment of money and receipts or any
other documents necessary to evidence, perfect and realize upon the security
interests and obligations of this Agreement.
8.9 Secured Party's duty with reference to the Collateral shall be
solely to use reasonable care in the custody and preservation of the Collateral
in Secured Party's possession. Secured Party shall not be responsible in any way
for any depreciation in value of the Collateral, nor shall any duty or
responsibility whatsoever rest upon Secured Party to take necessary steps to
preserve rights against prior parties or to enforce collection of the Collateral
by legal proceedings or otherwise, the sole duty of the Secured Party, its
successors and assigns, being to receive collections, remittances and payments
on such Collateral as and when made. In the event Debtor instructs Secured
Party, in writing or orally, to deliver any or all of the Collateral to a broker
or other third person, and Secured Party agrees to do so, the following
conditions shall be conclusively deemed to be a part of Secured Party's
agreement, whether or not they are specifically mentioned to Debtor at the time
of such agreement. Secured Party shall assume no responsibility for checking the
genuiness or authenticity of any person purporting to be a messenger, employee
or representative of the broker or other third person to whom Debtor has
directed Secured Party to deliver the Collateral, or the genuiness or
authenticity of any document of instructions delivered by any such person.
Debtor will be considered by requesting any such delivery to have assumed all
risk of loss as to the Collateral. Secured Party's sole responsibility will be
to deliver the Collateral to the person purporting to be the broker or third
person described by Debtor, or a messenger, employee or representative thereof.
Secured Party and Debtor hereby expressly agree that the foregoing actions by
Secured Party shall constitute reasonable care.
8.10 The pronouns used in this Agreement are in the masculine gender
but shall be construed as feminine or neuter as occasion may require.
8.11 The section headings appearing in this Agreement have been
inserted for convenience only and shall be given no substantive meaning or
significance whatever in construing the terms and provisions of this Agreement.
Terms used in this Agreement which are defined in the Texas Uniform Commercial
Code are used with the meanings as therein defined.
8.12 This Agreement shall be governed by and construed in accordance
with the laws of the State of Nevada and the United States of America.
EXECUTED as of this 13th day of February, 2001.
"DEBTOR"
By: /s/ Xxxxxxx X. Xxxxxx
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M&A WEST, INC.
"SECURED PARTY"
By:/s/
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REALTEC LTD.
