Exhibit 10.20
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COMMERCIAL SECURITY AGREEMENT
Principal: $2,000,000.00
Loan Date: 08-07-2002
Maturity: 09-01-2003
Loan No.: 9001
Call/Coll: 2/7380
Account: 0000000
Officer: 54403
Initials:
References in the shaded area are for Lender's use only and do not limit the
applicability of this document to any particular loan or item. Any item above
containing "***" has been omitted due to text length limitations.
Borrower: CATEGORY 5 TECHNOLOGIES, INC. Lender: ZIONS FIRST NATIONAL BANK
0000 XXXXXXXXXX XXXXXXX, XXXXX 000 XXXX XXXX XXXXXXXXXX BANKING DIVISION
XXXX XXXX XXXX, XX 00000 00 XXXX XXXXX XXXXXX, XXXXX 000
XXXX XXXX XXXX, XX 00000
Grantor: CATEGORY 5 TECHNOLOGIES, INC.
EPENZIO, INC.
0000 XXXXXXXXXX XXXXXXX, XXX 000
XXXX XXXX XXXX, XX 00000
================================================================================
THIS COMMERICAL SECURITY AGREEMENT dated August 7, 2002, is made and executed
among CATEGORY 5 TECHNOLOGIES, INC.; and EPENZIO, INC. ("Grantor"); CATEGORY 5
TECHNOLOGIES, INC. ("Borrower"); and ZIONS FIRST NATIONAL BANK ("Lender").
GRANT OF SECURITY INTEREST. For valuable consideration, Grantor grants to Lender
a security interest in the Collateral to secure the indebtedness and agrees that
Lender shall have the rights stated in this Agreement with respect to the
Collateral, in addition to all other rights which Lender may have by law.
COLLATERAL DESCRIPTION. The word "Collateral" as used in this Agreement means
the following described property, whether now owned or hereafter acquired,
whether now existing or hereafter arising, and wherever located, in which
Grantor is giving to Lender a security interest for the payment of the
Indebtedness and performance of all other obligations under the Note and this
Agreement:
ALL INVENTORY, CHATTEL PAPER, ACCOUNTS, GENERAL INTANGIBLES AND ALL
CONTRACT RECEIVABLE SERVICE BY DUVERA BILLING SERVICES, LLC., AND OWNED
BY EPENZIO, INC. AND CATEGORY 5 TECHNOLOGIES, INC.; WHETHER ANY OF THE
FOREGOING IS OWNED NOW OR ACQUIRED LATER; ALL ACCESSIONS, ADDITIONS,
REPLACEMENTS AND SUBSTITUTIONS RELATING TO ANY OF THE FOREGOING, ALL
RECORDS OF ANY KIND RELATING THERETO.
In addition, the word "Collateral" also includes all the following, whether now
owned or hereafter acquired, whether now existing or hereafter arising, and
wherever located:
(A) All accessions, attachments, accessories, replacements of any
additions to any of the collateral described herein, whether added now
or later.
(B) All products and produce of any of the property described in
this Collateral section.
(C) All accounts, general intangibles, instruments, rents, monies,
payments, and all other rights, arising out of a sale, lease, or other
disposition of any of the property described in this Collateral
section.
(D) All proceeds (including insurance proceeds) from the sale,
destruction, loss, or other disposition of any of the property
described in this Collateral section, and sums due from a third party
who has damaged or destroyed the Collateral or from that party's
insurer, whether due to judgment, settlement or other process.
(E) All records and data relating to any of the property described
in this Collateral section, whether in the form of a writing,
photograph, microfilm, microfiche, or electronic media, together with
all of Grantor's right, title, and interest in and to all computer
software required to utilize, create, maintain, and process any such
records or data on electronic media.
Despite any other provision of this Agreement, Lender is not granted, and will
not have, a nonpurchase money security interest in household goods, to the
extent such a security interest would be prohibited by applicable law. In
addition, if because of the type of any Property, Lender is required to give a
notice of the right to cancel under Truth in Lending for the Indebtedness, then
Lender will not have a security interest in such Collateral unless and until
such a notice is given.
CROSS-COLLATERALIZATION. In addition to the Note, this Agreement secured all
obligations, debts and liabilities, plus interest thereon, of Borrower to
Lender, or any one or more of them, as well as all claims by Lender against
Borrower or any one or more of them, whether now existing or hereafter arising,
whether related or unrelated to the purpose of the Note, whether voluntary or
otherwise, whether due or not due, direct or indirect, determined or
undetermined, absolute or contingent, liquidated or unliquidated whether
Borrower or Grantor may be liable individually or jointly with others, whether
obligated as guarantor, surety accommodation party or otherwise, and whether
recovery upon such amounts may be or hereafter may become barred by any statute
of limitations, and whether the obligation to repay such amounts may be or
hereafter may become otherwise unenforceable.
BORROWER'S WAIVERS AND RESPONSIBILITIES. Except as otherwise required under this
Agreement or by applicable law, (A) Borrower agrees that Lender need not tell
Borrower about any action or inaction Lender takes in connection with this
Agreement; (B) Borrower assumes the responsibility for being and keeping
informed about the Collateral; and (C) Borrower waives any defenses that may
arise because of any action or inaction of Lender, including without limitation
any failure of Lender to realize upon the Collateral or any delay by Lender in
realizing upon the Collateral; and Borrower agrees to remain liable under the
Note no matter what action Lender takes or fails to take under this Agreement.
GRANTOR'S REPRESENTATIVES AND WARRANTIES. Grantor warrants that: (A) this
Agreement is executed at Borrower's request and not at the request of Lender;
(B) Grantor has the full right, power and authority to enter into this Agreement
and to pledge the Collateral to Lender; (C) Grantor has established adequate
means of obtaining from Borrower on a continuing basis information about
Borrower's financial condition; and (D) Lender has made no representation to
Grantor about Borrower or Borrower's creditworthiness.
GRANTOR'S WAIVERS. Grantor waives all requirements of presentment, protest,
demand, and notice of dishonor or non-payment to Borrower or Grantor, or any
other party to the Indebtedness or the Collateral. Lender may do any of the
following with respect to any obligation of any Borrower, without first
obtaining the consent of Grantor; (A) grant any extension of time for any
payment, (B) grant any renewal, (C) permit any modification of payment terms or
other terms, or (D) exchange or release any Collateral or other security. No
such act or failure to act shall affect Lender's rights against Grantor or the
Collateral.
RIGHT OF SETOFF. To the extent permitted by applicable law, Lender reserves a
right of setoff in all Grantor's accounts with Lender (whether checking,
savings, or some other account). This includes all accounts Grantor holds
jointly with someone else and all accounts Grantor may open in the future.
However, this does not include any XXX or Xxxxx accounts, or any trust accounts
for which setoff would be prohibited by law. Grantor authorized Lender, to the
extent permitted by applicable law, to charge or setoff all sums owing on the
Indebtedness against any and all such accounts, and, at Lender's option, to
administratively freeze all such accounts to allow Lender to protect Lender's
charge and setoff rights provided in this paragraph.
COMMERCIAL SECURITY AGREEMENT
Loan No: 9001 (Continued) Page 2
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GRANTOR'S REPRESENTATIONS AND WARRANTIES WITH RESPECT TO THE COLLATERAL. With
respect to the Collateral, Grantor represents and promises to Lender that:
Perfection of Security Interest. Grantor agrees to execute financing statements
and to take whatever other actions are requested by Lender to perfect and
continue Lender's security interest in the Collateral. Upon request of Lender,
Grantor will deliver to Lender any and all of the documents evidencing or
constituting the Collateral, and Grantor will note Lender's interest upon any
and all chattel paper if not delivered to Lender for possession by Lender. This
is a continuing Security Agreement and will continue in effect even though all
or any part of the indebtedness is paid in full and even though for a period of
time Borrower may not be indebted to Lender.
Notices to Lender. Grantor will promptly notify Lender in writing at Lender's
address shown above for such other addresses as Lender may designate from time
to time) prior to any (1) change in Grantor's name; (2) change in Grantor's
assumed business name(s); (3) change in the management of any Corporation
Grantor; (4) change in the authorized signer(s); (5) change in Grantor's
principal office address; (6) change in Grantor's state of organization; (7)
conversion of Grantor to a new or different type of business entity; or (8)
change in any other aspect of Grantor that directly or indirectly relates to any
agreements between Grantor and Lender. No change in Grantor's name or state of
organization will take effect until after Lender has received notice.
No Violation. The execution and delivery of this Agreement will not violate any
law or agreement governing Grantor or to which Grantor is a party, and its
certificate or articles of incorporation and bylaws do not prohibit any term or
condition of this Agreement.
Enforceability of Collateral. To the extent the Collateral consists of accounts,
chattel paper, or general intangibles, as defined by the Uniform Commercial
Code, the Collateral is enforceable in accordance with its terms, is genuine,
and fully complies with all applicable laws and regulations concerning form,
content and manner of preparation and execution, and all persons appearing to be
obligated on the Collateral have authority and capacity to contract and are in
fact obligated as they appear to be on the Collateral. There shall be no setoffs
or counterclaims against any of the Collateral, and no agreement shall have been
made under which any deductions or discounts may be claimed concerning the
Collateral except those disclosed to Lender in writing.
Location of the Collateral. Except in the ordinary course of Grantor's business,
Grantor agrees to keep the Collateral at Grantor's address shown above or at
such other locations as are acceptable to Lender. Upon Lender's request, Grantor
will deliver to Lender in form satisfactory to Lender a schedule of real
properties and Collateral locations relating to Grantor's operations, including
without limitation the following: (1) all real property Grantor owns or is
purchasing; (2) all real property Grantor is renting or leasing; (3) all storage
facilities Grantor owns, rents, leases, or uses; and (4) all other properties
where Collateral is or may be located.
Removal of the Collateral. Except in the ordinary course of Grantor's business,
Grantor shall not remove the Collateral from its existing location without
Lender's prior written consent. Grantor shall, whenever requested, advise Lender
of the exact location of the Collateral.
Transactions Involving Collateral. Except for inventory sold or accounts
collected in the ordinary course of Grantor's business, or as otherwise provided
for in this Agreement, Grantor shall not sell, offer to sell, or otherwise
transfer or dispose of the Collateral. Grantor shall not pledge, mortgage,
encumber or otherwise permit the Collateral to be subject to any lien, security
interest, encumbrance, or charge, other than the security interest provided for
in this Agreement, without the prior written consent of Lender. This includes
security interests even if junior in right to the security interests granted
under this Agreement. Unless waived by Lender, all proceeds from any disposition
of the Collateral (for whatever reason) shall be held in trust for Lender and
shall not be commingled with any other funds; provided however, this requirement
shall not constitute consent by Lender to any sale or other disposition. Upon
receipt, Grantor shall immediately deliver any such proceeds to Lender.
Title. Grantor represents and warrants to Lender that Grantor holds good and
marketable title to the Collateral, free and clear of all liens and encumbrances
except for the lien of this Agreement. No financing statement covering any of
the Collateral is on file in any public office other than those which reflect
the security interest created by this Agreement or to which Lender has
specifically consented. Grantor shall defend Lender's rights in the Collateral
against the claims and demands of all other persons.
Repairs and Maintenance. Grantor agrees to keep and maintain, and to cause
others to keep and maintain, the Collateral in good order, repair and condition
at all times while this Agreement remains in effect. Grantor further agrees to
pay when due all claims for work done on, or services rendered or material
furnished in connection with the Collateral so that no lien or encumbrance may
ever attach to or be filed against the Collateral.
Inspection of Collateral. Lender and Lender's designated representatives and
agents shall have the right at all reasonable times to examine and inspect the
Collateral wherever located.
Taxes, Assessments and Liens. Grantor will pay when due all taxes, assessments
and liens upon the Collateral, its use or operation, upon this Agreement, upon
any promissory note or notes evidencing the Indebtedness, or upon any of the
other Related Documents. Grantor may withhold any such payment or may elect to
contest any lien if Grantor is in good faith conducting an appropriate
proceeding to contest the obligation to pay and so long as Lender's interest in
the Collateral is not jeopardized in Lender's sole opinion. If the Collateral is
subjected to a lien which is not discharged within fifteen (15) days, Grantor
shall deposit with Lender cash, a sufficient corporate surety bond or other
security satisfactory to Lender in an amount adequate to provide for the
discharge of the lien plus any interest, costs, reasonable attorneys' fees or
other charges that could accrue as a result of foreclosure or sale of the
Collateral. In any contest Grantor shall defend itself and Lender and shall
satisfy any final adverse judgment before enforcement against the Collateral.
Grantor shall name Lender as an additional obligee under any surety bond
furnished in the contest proceedings. Grantor further agrees to furnish Lender
with evidence that such taxes, assessments, and governmental and other charges
have been paid in full and in a timely manner. Grantor may withhold any such
payment or may elect to contest any lien if Grantor is in good faith conducting
an appropriate proceeding to contest the obligation to pay and so long as
Lender's interest in the Collateral is not jeopardized.
Compliance with Governmental Requirements. Grantor shall comply promptly with
all laws, ordinances, rules and regulations of all governmental authorities, now
or hereafter in effect, applicable to the ownership, production, disposition, or
use of the Collateral, including all laws or regulations relating to the undue
erosion of highly-erodible land or relating to the conversion of wetlands for
the production of an agricultural product or commodity. Grantor may contest in
good faith any such law, ordinance or regulation and withhold compliance during
any proceeding, including appropriate appeals, so long as Lender's interest in
the Collateral, in Lender's opinion, is not jeopardized.
Hazardous Substances. Grantor represents and warrants that the Collateral never
has been, and never will be so long as this Agreement remains a lien on the
Collateral, used in violation of any Environmental Laws or for the generation,
manufacture, storage, transportation, treatment, disposal, release or threatened
release of any Hazardous Substance. The representations and warranties contained
herein are based on Grantor's due diligence in investigating the Collateral for
Hazardous Substances. Grantor hereby (1) releases and waives any future claims
against Lender for indemnity or contribution in the event Grantor becomes liable
for cleanup or other costs under any Environmental Laws, and (2) agrees to
indemnify and hold harmless Lender against any and all claims and losses
resulting from a breach of this provision of this Agreement. This obligation to
indemnify shall survive the payment of the Indebtedness and the satisfaction of
this Agreement.
COMMERCIAL SECURITY AGREEMENT
Loan No: 9001 (Continued) Page 3
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Maintenance of Casualty Insurance. Grantor shall procure and maintain all risks
insurance, including without limitation fire, theft and liability coverage
together with such other insurance as Lender may require with respect to the
Collateral, in form, amounts, coverages and basis reasonably acceptable to
Lender and issued by a company or companies reasonably acceptable to Lender.
Grantor, upon request of Lender, will deliver to Lender from time to time the
policies or certificates of insurance in form satisfactory to Lender and not
including any disclaimer of the insurer's liability for failure to give such a
notice. Each insurance policy also shall include an endorsement providing that
coverage in favor of Lender will not be impaired in any way by any act, omission
or default of Grantor or any other person. In connection with all policies
covering assets in which Lender holds or is offered a security interest, Grantor
will provide Lender with such loss payable or other endorsements as Lender may
require. If Grantor at any time fails to obtain or maintain any insurance as
required under this Agreement, Lender may (but shall not be obligated to) obtain
such insurance as Lender deems appropriate, including if Lender so chooses
"single interest insurance," which will cover only Lender's interest in the
Collateral.
Application of Insurance Proceeds. Grantor shall promptly notify Lender of any
loss or damage to the Collateral. Lender may make proof of loss if Grantor fails
to do so within fifteen (15) days of the casualty. All proceeds of any insurance
on the Collateral, including accrued proceeds thereon, shall be held by Lender
as part of the Collateral. If Lender consents to repair or replacement of the
damaged or destroyed Collateral, Lender shall, upon satisfactory proof of
expenditure, pay or reimburse Grantor from the proceeds for the reasonable cost
of repair or restoration. If Lender does not consent to repair or replacement of
the Collateral, Lender shall retain a sufficient amount of the proceeds to pay
all of the Indebtedness, and shall pay the balance to Grantor. Any proceeds
which have not been disbursed within six (6) months after their receipt and
which Grantor has not committed to the repair or restoration of the Collateral
shall be used to prepay the Indebtedness.
Insurance Reserves. Lender may require Grantor to maintain with Lender reserves
for payment of insurance premiums, which reserves shall be created by monthly
payments from Grantor of a sum estimated by Lender to be sufficient to produce,
at least fifteen (15) days before the premium due date, amounts at least equal
to the insurance premiums to be paid. If fifteen (15) days before payment is
due, the reserve funds are insufficient, Grantor shall upon demand pay any
deficiency to Lender. The reserve funds shall be held by Lender as a general
deposit and shall constitute a non-interest-bearing account which Lender may
satisfy by payment of the insurance premiums required to be paid by Grantor as
they become due. Lender does not hold the reserve funds in trust for Grantor,
and Lender is not the agent of Grantor for payment of the insurance premiums
required to be paid by Grantor. The responsibility for the payment of premiums
shall remain Grantor's sole responsibility.
Insurance Reports. Grantor, upon request of Lender, shall furnish to Lender
reports on each existing policy of insurance showing such information as Lender
may reasonably request including the following: (1) the name of the insurer; (2)
the risks insured; (3) the amount of the policy; (4) the property insured; (5)
the then current value on the basis of which insurance has been obtained and the
manner of determining that value; and (6) the expiration date of the policy. In
addition, Grantor shall upon request by Lender (however not more often than
annually) have an independent appraiser satisfactory to Lender determine, as
applicable, the cash value or replacement cost of the Collateral.
Financing Statements. Grantor authorizes Lender to file a UCC-1 financing
statement, or alternatively, a copy of this Agreement to perfect Lender's
security interest. At Lender's request, Grantor additionally agrees to sign all
other documents that are necessary to perfect, protect, and continue Lender's
security interest in the Property. Grantor will pay all filing fees, title
transfer fees, and other fees and costs involved unless prohibited by law or
unless Lender is required by law to pay such fees and costs. Grantor irrevocably
appoints Lender to execute financing statements and documents of title in
Grantor's name and to execute all documents necessary to transfer title if there
is a default. Lender may file a copy of this Agreement as a financing statement.
If Grantor changes Grantor's name and address, or the name or address of any
person granting a security interest under this Agreement changes, Grantor will
promptly notify the Lender of such change.
GRANTOR'S RIGHT TO POSSESSION. Until default, Grantor may have possession of the
tangible personal property and beneficial use of all the Collateral and may use
it in any lawful manner not inconsistent with this Agreement or the Related
Documents, provided that Grantor's right to possession and beneficial use shall
not apply to any Collateral where possession of the Collateral by Lender is
required by law to perfect Lender's security interest in such Collateral. If
Lender at any time has possession of any Collateral, whether before or after an
Event of Default, Lender shall be deemed to have exercised reasonable care in
the custody and preservation of the Collateral if Lender takes such action for
that purpose as Grantor shall request or as Lender, in Lender's sole discretion,
shall deem appropriate under the circumstances, but failure to honor any request
by Grantor shall not of itself be deemed to be a failure to exercise reasonable
care. Lender shall not be required to take any steps necessary to preserve any
rights in the Collateral against prior parties, nor to protect, preserve or
maintain any security interest given to secure the Indebtedness.
LENDER'S EXPENDITURES. If any action or proceeding is commenced that would
materially affect Lender's interest in the Collateral or if Grantor fails to
comply with any provision of this Agreement or any Related Documents, Lender on
Grantor's behalf may (but shall not be obligated to) take any action that Lender
deems appropriate, including but not limited to discharging or paying all taxes,
liens, security interests, encumbrances and other claims, at any time levied or
placed on the Collateral and paying all costs for insuring, and maintaining and
preserving the Collateral. All such expenditures incurred or paid by Lender for
such purposes will then bear interest at the rate charged under the Note from
the date incurred or paid by Lender to the date of repayment by Grantor. All
such expenses will become a part of the Indebtedness and, at Lender's option,
will (A) be payable on demand; (B) be added to the balance of the Note and be
apportioned among and be payable with any installment payments to become due
during either (1) the term of any applicable insurance policy; or (2) the
remaining term of the Note; or (C) be treated as a balloon payment which will be
due and payable at the Note's maturity. The Agreement also will secure payment
of these amounts. Such right shall be in addition to all other rights and
remedies to which Lender may be entitled upon Default.
DEFAULT. Each of the following shall constitute an Event of Default under this
Agreement:
Payment Default. Borrower fails to make any payment when due under the
Indebtedness.
Other Defaults. Borrower or Grantor fails to comply with or to perform any other
term, obligation, covenant or condition contained in this Agreement or in any of
the Related Documents or to comply with or to perform any term, obligation,
covenant or condition in any other agreement between Lender and Borrower or
Grantor.
Default in Favor of Third Parties. Should Borrower or any Grantor default under
any loan, extension of credit, security agreement, purchase or sales agreement,
or any other agreement, in favor of any other creditor or person that may
materially affect any of Grantor's property or Borrower's or any Grantor's
ability to repay the indebtedness or perform their respective obligations under
this Agreement or any of the Related Documents.
COMMERCIAL SECURITY AGREEMENT
Loan No: 9001 (Continued) Page 4
================================================================================
False Statements. Any warranty, representation or statement made or furnished to
Lender by Borrower or Grantor or on Borrower's or Grantor's behalf under this
Agreement or the Related Documents is false or misleading in any material
respect, either now or at the time made or furnished or becomes false or
misleading at any time thereafter.
Defective Collateralization. This Agreement or any of the Related Documents
ceases to be in full force and effect (including failure of any collateral
document to create a valid and perfected security interest or lien) at any time
and for any reason.
Insolvency. The dissolution or termination of Borrower's or Grantor's existence
as a going business, the insolvency of Borrower or Grantor, the appointment of a
receiver for any part of Borrower's or Grantor's property, any assignment for
the benefit of creditors, any type of creditor workout, or the commencement of
any proceeding under any bankruptcy or insolvency laws by or against Borrower or
Grantor.
Creditor or Forfeiture Proceedings. Commencement of foreclosure or forfeiture
proceedings, whether by judicial proceeding, self-help, repossession or any
other method, by any creditor of Borrower or Grantor or by any governmental
agency against any collateral securing the Indebtedness. This includes a
garnishment of any of Borrower's or Grantor's accounts, including deposit
accounts, with Lender. However, this Event of Default shall not apply if there
is a good faith dispute by Borrower or Grantor as to the validity or
reasonableness of the claim which is the basis of the creditor or forfeiture
proceeding and if Borrower or Grantor gives Lender written notice of the
creditor or forfeiture proceeding and deposits with Lender monies or a surety
bond for the creditor or forfeiture proceeding, in an amount determined by
Lender, in its sole discretion, as being an adequate reserve or bond for the
dispute.
Events Affecting Guarantor. Any of the preceding events occurs with respect to
guarantor, endorser, surety or accommodation party of any of the Indebtedness or
guarantor, endorser, surety, or accommodation party dies or becomes incompetent
or revokes or disputes the validity of, or liability under, any Guaranty of the
Indebtedness.
Adverse Change. A material adverse change occurs in Borrower's or Grantor's
financial condition, or Lender believes the prospect of payment or performance
of the Indebtedness is impaired.
Insecurity. Lender in good faith believes itself insecure.
Cure Provisions. If any default, other than a default in payment is curable and
if Grantor has not been given a notice of a breach of the same provision of this
Agreement within the preceding twelve (12) months, it may be cured (and not
event of default will have occurred) if Grantor, after receiving written notice
from Lender demanding cure of such default: (1) cures the default within fifteen
(15) days; or (2) if the cure requires more than fifteen (15) days, immediately
initiates steps which Lender deems in Lender's sole discretion to be sufficient
to cure the default and thereafter continues and completes all reasonable and
necessary steps sufficient to produce compliance as soon as reasonably
practical.
RIGHTS AND REMEDIES ON DEFAULT. If an Event of Default occurs under this
Agreement, at any time thereafter, Lender shall have all the rights of a secured
party under the Utah Uniform Commercial Code. In addition and without
limitation, Lender may exercise any one or more of the following rights and
remedies:
Accelerate Indebtedness. Lender may declare the entire Indebtedness, including
any prepayment penalty which Borrower would be required to pay, immediately due
and payable, without notice of any kind to Borrower or Grantor.
Assemble Collateral. Lender may require Grantor to deliver to Lender all or any
portion of the Collateral and any and all certificates of title and other
documents relating to the Collateral. Lender may require Grantor to assemble the
Collateral and make it available to Lender at a place to be designated by
Lender. Lender also shall have full power to enter upon the property of Grantor
to take possession of and remove the Collateral. If the Collateral contains
other goods not covered by this Agreement at the time of possession, Grantor
agrees Lender may take such other goods, provided that Lender makes reasonable
efforts to return them to Grantor after repossession.
Sell the Collateral. Lender shall have full power to sell, lease, transfer, or
otherwise deal with the Collateral or proceeds thereof in Lender's own name or
that of Grantor. Lender may sell the Collateral at public auction or private
sale. Unless the Collateral threatens to decline speedily in value or is of a
type customarily sold on a recognized market, Lender will give Grantor, and
other persons as required by law, reasonable notice of the time and place of any
public sale, or the time after which any private sale or any other disposition
of the Collateral is to be made. However, no notice need be provided to any
person who, after Event of Default occurs, enters into and authenticates an
agreement waiving that person's right to notification of sale. The requirements
of reasonable notice shall be met if such notice is given at least ten (10) days
before the time of the sale or disposition. All expenses relating to the
disposition of the Collateral, including without limitation the expenses of
retaking, holding, insuring, preparing for sale and selling the Collateral,
shall become a part of the Indebtedness secured by this Agreement and shall be
payable on demand, with interest at the Note rate from date of expenditure until
repaid. Appoint Receiver. Lender shall have the right to have a receiver
appointed to take possession of all or any part of the Collateral, with the
power to protect and preserve the Collateral, to operate the Collateral
preceding foreclosure or sale, and to collect the Rents from the Collateral and
apply the proceeds, over and above the cost of the receivership, against the
Indebtedness. Grantor hereby waives any requirement that the receiver be
impartial and disinterested as to all of the parties and agrees that employment
by Lender shall not disqualify a person from serving as a receiver.
Collect Revenues, Apply Accounts. Lender, either itself or through a receiver,
may collect the payments, rents, income, and revenues from the Collateral.
Lender may at any time in Lender's discretion transfer any Collateral into
Lender's own name or that of Lender's nominee and receive the payments, rents,
income, and revenues therefrom and hold the same as security for the
Indebtedness or apply it to payment of the Indebtedness in such order of
preference as Lender may determine. Insofar as the Collateral consists of
accounts, general intangibles, insurance policies, instruments, chattel paper,
choses in action, or similar property, Lender may demand, collect, receipt for,
settle, compromise, adjust, xxx for, foreclose, or realize on the Collateral as
Lender may determine, whether or not Indebtedness or Collateral is then due. For
these purposes, Lender may, on behalf of and in the name of Grantor, receive,
open and dispose of mail addressed to Grantor; change any address to which mail
and payments are to be sent; and endorse notes, checks, drafts, money orders,
documents of title, instruments and items pertaining to payment, shipment, or
storage of any Collateral. To facilitate collection, Lender may notify account
debtors and obligors on any Collateral to make payments directly to Lender.
Obtain Deficiency. If Lender chooses to sell any or all of the Collateral,
Lender may obtain a judgment against Borrower for any deficiency remaining on
the Indebtedness due to Lender after application of all amounts received from
the exercise of the rights provided in this Agreement. Borrower shall be liable
for a deficiency even if the transaction described in this subsection is a sale
of accounts or chattel paper.
Other Rights and Remedies. Lender shall have all the rights and remedies of a
secured creditor under the provisions of the Uniform Commercial Code, as may be
amended from time to time. In addition, Lender shall have and may exercise any
or all other rights and remedies it may have available at law, in equity, or
otherwise.
Election of Remedies. Except as may be prohibited by applicable law, all of
Lender's rights and remedies, whether evidenced by this Agreement, the Related
Documents, or by any other writing, shall be cumulative and may be exercised
singularly or concurrently. Election by Lender to pursue any remedy shall not
exclude pursuit of any other remedy, and an election to make expenditures or to
take action to perform an obligation of Grantor under this Agreement, after
Grantor's failure to perform, shall not affect Lender's right to declare a
default and exercise its remedies.
COMMERCIAL SECURITY AGREEMENT
Loan No: 9001 (Continued) Page 5
================================================================================
MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of
this Agreement:
Amendments. This Agreement, together with any Related Documents, constitutes the
entire understanding and agreement of the parties as to the matters set forth in
this Agreement. No alteration of or amendment to this Agreement shall be
effective unless given in writing and signed by the party or parties sought to
be charged or bound by the alteration or amendment.
Arbitration Disclosures.
1. ARBITRATION IS FINAL AND BINDING ON THE PARTIES AND SUBJECT TO
ONLY VERY LIMITED REVIEW BY A COURT.
2. IN ARBITRATION THE PARTIES ARE WAIVING THEIR RIGHT TO LITIGATE IN
COURT, INCLUDING THEIR RIGHT TO A JURY TRIAL.
3. DISCOVERY IN ARBITRATION ISMORE LIMITED THAN DISCOVERY IN COURT.
4. ARBITRATORS ARE NOT REQUIRED TO INCLUDE FACTUAL FINDINGS OR LEGAL
REASONING IN THEIR AWARDS. THE RIGHT TO APPEAL OR SEEK
MODIFICATION OF ARBITRATORS' RULINGS IS VERY LIMITED.
5. A PANEL OF ARBITRATORS MIGHT INCLUDE AN ARBITRATOR WHO IS OR WAS
AFFILIATED WITH THE BANKING INDUSTRY.
6. ARBITRATION WILL APPLY TO ALL DISPUTES BETWEEN THE PARTIES, NO
JUST THOSE CONCERNING THE AGREEMENT.
7. IF YOU HAVE QUESTIONS ABOUT ARBITRATION, CONSULT YOUR ATTORNEY OR
THE AMERICAN ARBITRATION ASSOCIATION.
(a) Any claim or controversy ("Dispute") between or among the parties
and their employees, agents, affiliates, and assigns, including, but
not limited to, Disputes arising out of or relating to this agreement,
this arbitration provision ("arbitration clause"), or any related
agreements or instruments relating hereto or delivered in connection
herewith ("Related Agreements"), and including, but not limited to, a
Dispute based on or arising from an alleged tort, shall at the request
of any party be resolved by binding arbitration in accordance with the
applicable arbitration rules of the American Arbitration Association
(the "Administrator"). The provisions of this arbitration clause shall
survive any termination, amendment, or expiration of this agreement or
Related Agreements. The provisions of this arbitration clause shall
supersede any prior arbitration agreement between or among the parties.
(b) The arbitration proceedings shall be conducted in a city mutually
agreed by the parties. Absent such an agreement, arbitration will be
conducted in Salt Lake City, Utah or such other place as may be
determined by the Administrator. The Administrator and the
arbitrator(s) shall have the authority to the extent practicable to
take any action to require the arbitration proceeding to be completed
and the arbitrator(s)' award issued within 150 days of the filing of
the Dispute with the Administrator. The arbitrator(s) shall have the
authority to impose sanctions on any party that fails to comply with
time periods imposed by the Administrator or the arbitrator(s),
including the sanction of summarily dismissing any Dispute or defense
with prejudice. The arbitrator(s) shall have the authority to resolve
any Dispute regarding the terms of this agreement, this arbitration
clause, or Related Agreements, including any claim or controversy
regarding the arbitrability of any Dispute. All limitations periods
applicable to any Dispute or defense, whether by statute or agreement,
shall apply to any arbitration proceeding hereunder and the
arbitrator(s) shall have the authority to decide whether any Dispute or
defense, is barred by a limitations period and, if so, to summarily
enter an award dismissing any Dispute or defense on that basis. The
doctrines of compulsory counterclaim, res judicata, and collateral
estoppel shall apply to any arbitration proceeding hereunder so that a
party must state as a counterclaim in the arbitration proceeding any
claim or controversy which arises out of the transaction or occurrence
that is the subject matter of the Dispute. The arbitrator(s) may in the
arbitrator(s)' discretion and at the request of any party: (1)
consolidate in a single arbitration proceeding any other claim arising
out of the same transaction involving another party to that transaction
that is bound by an arbitration clause with Lender, such as borrowers,
guarantors, sureties, and owners of collateral; and (2) consolidate or
administer multiple arbitration claims or controversies as a class
action in accordance with Rule 23 of the Federal Rules of Civil
Procedure.
(c) The arbitrator(s) shall be selected in accordance with the rules of
the Administrator from panels maintained by the Administrator. A single
arbitrator shall have expertise in the subject matter of the Dispute.
Where three arbitrators conduct an arbitration proceeding, the Dispute
shall be decided by a majority vote of the three arbitrators, at least
one of whom must have expertise in the subject matter of the Dispute
and at least one of whom must be a practicing attorney. The
arbitrator(s) shall award to the prevailing party recovery of all costs
and fees (including attorneys' fees and costs, arbitration
administration fees and costs, and arbitrator(s)' fees. The
arbitrator(s), either during the pendency of the arbitration proceeding
or as part of the arbitration award, also may grant provisional or
ancillary remedies including but not limited to an award of injunctive
relief, foreclosure, sequestration, attachment, replevin, garnishment,
or the appointment of a receiver.
(d) Judgment upon an arbitration award may be entered in any court
having jurisdiction, subject to the following limitation: the
arbitration award is binding upon the parties only if the amount does
not exceed Four Million Dollars ($4,000,000.00); if the award exceeds
that limit, either party may demand the right to a court trial. Such a
demand must be filed with the Administrator within thirty (30) days
following the date of the arbitration award; if such a demand is not
made with that time period, the amount of the arbitration award shall
be binding. The computation of the total amount of an arbitration award
shall include amounts awarded for attorneys' fees and costs,
arbitration administration fees and costs, and arbitrator(s)' fees.
(e) No provision of this arbitration clause, nor the exercise of any
rights hereunder, shall limit the right of any party to: (1) judicially
or non-judicially foreclose against any real or personal property
collateral or other security; (2) exercise self-help remedies,
including but not limited to repossession and setoff rights; or (3)
obtain from a court having jurisdiction thereover any provisional or
ancillary remedies including but not limited to injunctive relief,
foreclosure, sequestration, attachment, replevin, garnishment, or the
appointment of a receiver. Such rights can be exercised at any time,
before or after initiation of an arbitration proceeding, except to the
extent such action is contrary to the arbitration award. The exercise
of such rights shall not constitute a waiver of the right to submit any
Dispute to arbitration, and any claim or controversy related to the
exercise of such rights shall be a Dispute to be resolved under the
provisions of this arbitration clause. Any party may initiate
arbitration with the Administrator. If any party desires to arbitrate a
Dispute asserted against such party in a complaint, counterclaim,
cross-claim, or third-party complaint thereto, or in an answer or other
reply to any such pleading, such party must make an appropriate motion
to the trial court seeking to compel arbitration, which motion must be
filed with the court within 45 days of service of the pleading, or
amendment thereto, setting forth such Dispute. If arbitration is
compelled after commencement of litigation of a Dispute, the party
obtaining an order compelling arbitration shall commence arbitration
and pay the Administrator's filing fees and costs within 45 days of
entry of such order. Failure to do so shall constitute an agreement to
proceed with litigation and waiver of the right to arbitrate. In any
arbitration commenced by a consumer regarding a consumer Dispute,
Lender shall pay one half of the Administrator's filing fee, up to
$250.
(f) Notwithstanding the applicability of any other law to this
agreement, the arbitration clause, or Related Agreements between or
among the parties, the Federal Arbitration Act, 9 U.S.C. Section 1 et
seq., shall apply to the construction and interpretation of this
arbitration clause. If any provision of this arbitration clause should
be determined to be unenforceable, all other provisions of this
arbitration clause shall remain in full force and effect.
Attorneys' Fees; Expenses. Grantor agrees to pay upon demand all of Lender's
costs and expenses, including
COMMERCIAL SECURITY AGREEMENT
Loan No: 9001 (Continued) Page 6
================================================================================
Lender's reasonable attorney's fees and Lender's legal expenses, incurred in
connection with the enforcement of this Agreement. Lender may hire or pay
someone else to help enforce this Agreement, and Grantor shall pay the costs and
expenses of such enforcements. Costs and expenses include Lender's reasonable
attorneys' fees and legal expenses whether or not Lender's salaried employee and
whether or not there is a lawsuit, including reasonable attorneys' fees and
legal expenses for bankruptcy proceedings (including efforts to modify or vacate
any automatic stay or injunction), appeals, and any anticipated post-judgment
collection services. Grantor also shall pay all court costs and such additional
fees as may be directed by the court.
Caption Headings. Caption headings in this Agreement are for convenience purpose
only and are not to be used to interpret or define the provisions of this
Agreement.
Governing Law. This Agreement will be governed by, construed and enforced in
accordance with federal law and the laws of the State of Utah. This Agreement
has been accepted by Lender in the State of Utah.
Choice of Venue. If there is a lawsuit, Grantor agrees upon Lender's request to
submit to the jurisdiction of the courts of SALT LAKE County, State of Utah.
Joint and Several Liability. All obligations of Borrower and Grantor under this
Agreement shall be joint and several, and all references to Grantor shall mean
each and every Borrower. This means that each Borrower and Grantor signing below
is responsible for all obligations in this Agreement. Where any one or more of
the parties is a corporation, partnership, limited liability company or similar
entity, it is not necessary for Lender to inquire into the powers of any of the
officers, directors, partners, members, or other agents acting or purporting to
act on the entity's behalf, and any obligations made or created in reliance upon
the professed exercise of such powers shall be guaranteed under this Agreement.
No Waiver by Lender. Lender shall not be deemed to have waived any rights under
this Agreement unless such waiver is given in writing and signed by Lender. No
delay or omission on the part of Lender in exercising any right shall operate as
a waiver of such right or any other right. A waiver by Lender of a provision of
this Agreement shall not prejudice or constitute a waiver of Lender's right
otherwise to demand strict compliance with that provision or any other provision
of this Agreement. No prior waiver by Lender, nor any course of dealing between
Lender and Grantor, shall constitute a waiver of any of Lender's rights or of
any of Grantor's obligations as to any future transactions. Whenever the consent
of Lender is required under this Agreement, the granting of such consent by
Lender in any instance shall not constitute continuing consent to subsequent
instances where such consent is required and in all cases such consent nay be
granted or withheld in the sole discretion of Lender.
Notices. Unless otherwise provided by applicable law, any notice required to be
given under this Agreement or required by law shall be given in writing, and
shall be effective when actually delivered in accordance with the law or with
this Agreement, when actually received by telefacsimile (unless otherwise
required by law), when deposited with a nationally recognized overnight courier,
or, if mailed, when deposited in the United States mail, as first class,
certified or registered mail postage prepaid, directed to the addresses shown
near the beginning of this Agreement. Any party may change its address for
notices under this Agreement by giving formal written notice to the other
parties, specifying that the purpose of the notice is to change the party's
address. For notice purposes, Grantor agrees to keep Lender informed at all
times of Grantor's current address. Unless otherwise provided by applicable law,
if there is more than one Grantor, any notice given by Lender to any Grantor is
deemed to be notice given to all Grantors.
Power of Attorney. Grantor hereby appoints Lender as Grantor's irrevocable
attorney-in-fact for the purpose of executing any documents necessary to
perfect, amend, or to continue the security interest granted in this Agreement
or to demand termination of filings of other secured parties. Lender may at any
time, and without further authorization from Grantor, file a carbon,
photographic or other reproduction of any financing statement or of this
Agreement for use as a financing statement. Grantor will reimburse Lender for
all expenses for the perfection and the continuation of the perfection of
Lender's security interest in the collateral.
Severability. If a court of competent jurisdiction finds any provision of this
Agreement to be illegal, invalid, or unenforceable as to any person or
circumstance, that finding shall not make the offending provision illegal,
invalid, or unenforceable as to any other person or circumstance. If feasible,
the offending provision shall be considered modified so that it becomes legal,
valid and enforceable. If the offending provision cannot be so modified, it
shall be considered deleted from this Agreement. Unless otherwise required by
law, the illegality, invalidity, or unenforceability of any provision of this
Agreement shall not affect the legality, validity or enforceability of any other
provision of this Agreement.
Successors and Assigns. Subject to any limitations stated in this Agreement on
transfer of Grantor's interest, this Agreement shall be binding upon and inure
to the benefit of the parties, their successors and assigns. If ownership of the
Collateral becomes vested in a person other than Grantor, Lender, without notice
to Grantor, may deal with Grantor's successors with reference to this Agreement
and the Indebtedness by way of forbearance or extension without releasing
Grantor from the obligations of this Agreement or liability under the
Indebtedness.
Survival of Representations and Warranties. All representations, warranties, and
agreements made by Grantor in this Agreement shall survive the execution and
delivery of this Agreement, shall be continuing in nature, and shall remain in
full force and effect until such time as Borrower's Indebtedness shall be paid
in full.
Time is of the Essence. Time is of the essence in the performance of this
Agreement.
DEFINITIONS. The following capitalized words and terms shall have the following
meanings when used in this Agreement. Unless specifically stated to the
contrary, all references to dollar amounts shall mean amounts in lawful money of
the United States of America. Words and terms used in the singular shall include
the plural, and the plural shall include the singular, as the context may
require. Words and terms not otherwise defined in this Agreement shall have the
meanings attributed to such terms in the Uniform Commercial Code:
Agreement. The word "Agreement" means this commercial Security Agreement, as
this Commercial Security Agreement may be amended or modified form time to time,
together with all exhibits and schedules attached to this Commercial Security
Agreement from time to time.
Borrower. The word "Borrower" means CATEGORY 5 TECHNOLOGIES, INC., and all other
person and entities signing the Not in whatever capacity.
Collateral. The word "Collateral" means all of Grantor's right, title and
interest in and to all the Collateral as described in the Collateral Description
section of this Agreement.
Default. The word "Default" means the Default set forth in this Agreement in the
section titled "Default".
Environmental Laws. The words "Environmental Laws" mean any and all state,
federal and local statutes, regulations and ordinances relating to the
protection of human health or the environment, including without limitation the
Comprehensive Environmental Response, Compensation, and Liability Act of 1980,
as amended, 42 U.S.C. Section 9601, et seq. ("CERCLA"), the Superfund Amendments
and Reauthorization Act of 1986, Pub. L. No. 99-499 ("XXXX"), the Hazardous
Materials Transportation Act, 49 U.S.C. Section 1801, et seq., the Resource
Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq., or other
applicable state or federal laws rules, or regulations adopted pursuant thereto.
COMMERCIAL SECURITY AGREEMENT
Loan No: 9001 (Continued) Page 7
================================================================================
Event of Default. The words "Event of Default" mean any of the events of default
set forth in this Agreement in the default section of this Agreement.
Grantor. The word "Grantor" means CATEGORY 5 TECHNOLOGIES, INC.; and EPENZIO,
INC..
Hazardous Substances. The words "Hazardous Substances" mean materials that,
because of their quantity, concentration or physical, chemical or infectious
characteristics, may cause or pose a present or potential hazard to human health
or the environment when improperly used, treated, stored, disposed of,
generated, manufactured, transported or otherwise handled. The words "Hazardous
Substances" are used in their very broadest sense and include without limitation
any and all hazardous or toxic substances, materials or waste as defined by or
listed under the Environmental Laws. The term "Hazardous Substances" also
includes, without limitations, petroleum and petroleum by-products or any
fraction thereof any asbestos.
Indebtedness. The word "Indebtedness" means and includes without limitation all
Loans, together with all other obligations, debts and liabilities of Borrower to
Lender, or any one or more of them, as well as all claims by Lender against
Borrower, or any one or more of them; whether now or hereafter existing,
voluntary, due or not due, absolute or contingent, liquidated or unliquidated;
whether Borrower may be liable individually or jointly with others; whether
Borrower may be obligated as a guarantor, surety, or otherwise; whether recovery
upon such indebtedness may be or hereafter may become barred by any statute of
limitations; and whether such indebtedness may be or hereafter may become
otherwise unenforceable.
Lender. The word "Lender" means ZIONS FIRST NATIONAL BANK, its successors and
assigns.
Note. The word "Note" means the Note executed by CATEGORY 5 TECHNOLOGIES, INC.
in the principal amount of $2,000,000.00 dated August 7, 2002, together with all
renewals of extensions of, modifications of, refinancing of, consolidations of,
and substitutions for not or credit agreement.
Property. The word "Property" means all of Grantor's right, title and interest
in and to all the Property as described in the "Collateral Description" section
of this Agreement.
Related Documents. The words "Related Documents" means all promissory notes,
credit agreements, loan agreements, environmental agreements, guaranties,
security agreements, mortgages, deeds of trust, security deeds, collateral
mortgages, and all other instruments, agreements and documents, whether now or
hereafter existing, executed in connection with eh Indebtedness.
BORROWER AND GRANTOR HAVE REAND AND UNDERSTOOD ALL THE PROVISIONS OF THIS
COMMERCIAL SECURITY AGREEMNT AND AGREE TO ITS TERMS. THIS AGREEMNT IS DATED
AUGUST 7, 2002.
GRANTOR:
CATEGORY 5 TECHNOLOGIES, INC.
BY: /s/
-------------------------------------
XXXX X XXXXXXXX, CEO OF CATEGORY 5
TECHOLOGIES, INC.
EPENZIO, INC.
BY: /s/
-------------------------------------
XXXX X XXXXXXXX, CEO OF EPENZIO, INC.
BORROWER
CATEGORY 5 TECHNOLOGIES, INC.
BY: /s/
-------------------------------------
XXXX X XXXXXXXX, CEO OF CATEGORY 5
TECHNOLOGIES, INC.
LANDLORD'S CONSENT
Principal:
Loan Date: 08-07-2002
Maturity: 09-01-2003
Loan No.: 9001
Call/Coll: 2/7380
Account: 0000000
Officer: 54403
Initials:
References in the shaded area are for Lender's use only and do not limit the
applicability of this document to any particular loan or item. Any item above
containing "***" has been omitted due to text length limitations.
Borrower: CATEGORY 5 TECHNOLOGIES, INC. Lender: ZIONS FIRST NATIONAL BANK
0000 XXXXXXXXXX XXXXXXX, XXXXX 000 XXXX XXXX XXXXXXXXXX BANKING DIVISION
XXXX XXXX XXXX, XX 00000 00 XXXX XXXXX XXXXXX, XXXXX 000
XXXX XXXX XXXX, XX 00000
================================================================================
This landlord's consent is entered into and among Cateogry 5 Technologies, Inc.
("Borrower"), whose address is 0000 Xxxxxxxxxx Xxxxxxx, Xxxxx 000, Xxxx Xxxx
Xxxx, XX 00000; Zions First National Bank ("Lender"), whose address is Salt Lake
Commercial Banking Division, 00 Xxxx Xxxxx Xxxxxx, Xxxxx 000, Xxxx Xxxx Xxxx, XX
00000; and Cottonwood Realty Service ("Landlord"), whose address is 0000 Xxxx
Xxxxxxxxxx Xxxxxxx, #000, Xxxx Xxxx Xxxx, XX 00000. Borrower and Lender have
entered into, or are about to enter into, an agreement whereby Lender has
acquired or will acquire a security interest or other interest in the
Collateral. Some or all of the Collateral may be affixed or otherwise become
located on the Premises. To induce Lender to extend the Loan to Borrower against
such security interest in the Collateral and for other valuable consideration,
Landlord hereby agrees with Lender and Borrower as follows.
COLLATERAL DESCRIPTION. The word "Collateral" means certain of Borrower's
personal property in which Lender has acquired or will acquire a security
interest, including without limitation the following specific property;
ALL INVENTORY, CHATTEL PAPER, ACCOUNTS, GENERAL INTANGIBLES AND ALL CONTRACT
RECEIVABLES SERVICE BY DUVERA BILLING SERVICES, LLC., AND OWNED BY EPENZIO, INC.
AND CATEGORY 5 TECHNOLGIES, INC.; WHETHER ANY OF THE FOREGOING IS OWNDED NOW OR
ACQUIRED LATER; ALL ACCESSIONS, ADDITIONS, REPLACEMENTS AND SUBSTITUTIONS
RELATING TO ANY OF THE FOREGOING, ALL RECORDS OF ANY KIND RELATING THERETO.
BORROWERS ASSIGNMENT OF LEASE. Borrower hereby assigns to Lender all of
Borrower's rights in the Lease, as partial security for the Loan. The parties
intend that this assignment will be a present transfer to Lender of all of
Borrower's rights under the Lease, subject to Borrower's rights to use the
Premises and enjoy the benefits of the Lease while not in default on the Loan or
Lease. Upon full performance by Borrower under the Loan, this assignment shall
be ended, without the necessity of any further action by any of the parties.
This assignment includes all renewals of and amendments to the Lease or the
Loan, until the Loan is paid in full. No amendments may be made to the Lease
without Lender's prior written consent, which shall not be unreasonably withheld
or delayed.
CONSENT OF LANDLORD. Landlord consents to the above assignment. If Borrower
defaults under the Loan or the Lease, Lender may reassign the Lease, and
Landlord agrees that Landlord's consent to any such reassignment will not be
unreasonably withheld or delayed. So long as Lender has not entered the Premises
for the purpose of operating a business, Lender will have no liability under the
Lease, including without limitation liability for rent. Whether or not Lender
enters into possession of the Premises for any purpose, Borrower will remain
fully liable for all obligations of Borrower as lessee under the lease. While
Lender is in possession of the Premises, Lender will cause all payments due
under the Lease and attributable to that period of time to be made to Landlord.
If Lender later reassigns the Lease or vacates the Premises, Lender will have no
further obligation to the Landlord.
LEASE DEFAULTS. Both Borrower and Landlord agree and represent to Lender that,
to the best of their knowledge, there is not breach or offset existing under the
Lease or under any other agreement between Borrower and Landlord. Landlord
agrees not to terminate the Lease, despite any default by Borrower, without
giving Lender written notice of the default and an opportunity to cure the
default within a period of sixty (60) days from the receipt of the notice. If
the default is one that cannot reasonably be cured by Lender (such as
insolvency, bankruptcy, or other judicial proceedings against Borrower), then
Landlord will not terminate the Lease so long as Landlord receives all sums due
under the Lease for the Period during which Lender is in possession of the
Premises, or so long as lender reassigns the Lease to a new lessee reasonably
satisfactory to Landlord.
DISCLAIMER OF INTEREST. Landlord hereby consents to Lender's security interest
(or other interest) in the Collateral and disclaims all interests, liens and
claims which Landlord now has or may hereafter acquire in the Collateral.
Landlord agrees that any lien or claim it may now have or may hereafter have in
the Collateral will be subject at all times to Lender's security interest (or
other present or future interest) in the Collateral and will be subject to the
rights granted by Landlord to Lender in this Agreement.
ENTRY ONTO PREMISES. Landlord and Borrower grant to Lender the right to enter
upon the Premises for the Purpose of removing the Collateral from the Premises
or conducting sales of the Collateral on the Premises. The rights granted to
Lender in this Agreement will continue until a reasonable time after Lender
receives notice in writing from Landlord that Borrower no longer is in lawful
possession of the Premises. If Lender enters onto the Premises and removes the
Collateral, Lender agrees with Landlord not to remove any Collateral in such a
way that the Premises are damaged, without either repairing any such damage or
reimbursing Landlord for the cost of repair.
MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of
this Agreement: This Agreement shall extend to and bind the respective heirs,
personal representatives, successors and assigns of the parties to this
Agreement. The covenants of Borrower and Landlord respecting subordination of
the claim or claims of Landlord in favor of Lender shall extend to, include, and
be enforceable by any transferee or endorsee to whom Lender may transfer any
claim or claims to which this Agreement shall apply. Lender need not accept this
Agreement in writing or otherwise to make it effective. This Agreement shall be
governed by and construed in accordance with the laws of the State of Utah. If
Landlord is other than an individual, any agent or other person executing this
Agreement on behalf of Landlord represents and warrants to Lender that he or she
has full power and authority to execute this Agreement on Landlord's behalf.
Lender shall not be deemed to have waived any rights under this Agreement unless
such waiver is in writing and signed by Lender. Without notice to Landlord and
without affecting the validity of this Consent, Lender may do or not do anything
it deems appropriate or necessary with respect to the Loan, any obligors on the
Loan, or any Collateral for the Loan; including without limitation extending,
renewing, rearranging, or accelerating any of the Loan indebtedness.
AMENDMENTS. This agreement, together with any Related Documents, constitutes the
entire understanding and agreement of the parties as to the matters set forth in
this Agreement. No alteration of or amendment to this Agreement shall be
effective unless given in writing and signed by the party of parties sought to
be charged or bound by the alteration or amendment.
NO WAIVER BY LENDER. Lender shall not be deemed to have waived any rights under
this Agreement unless such waiver is given in writing and signed by Lender. No
delay or omission on the part of Lender in exercising any right shall operate as
a waiver of such right or any other right. A waiver by Lender of a provision of
this Agreement shall not prejudice or constitute a waiver of Lender's right
otherwise to demand strict compliance with that provision or any other provision
of this Agreement. No prior waiver by Lender, nor any course of dealing between
Lender and Landlord, shall constitute a waiver of any of Lender's rights or of
any of Landlord's obligations as to any future transactions.
LANDLORD'S CONSENT
Loan No: 9001 (Continued) Page 2
================================================================================
Whenever the consent of Lender is required under this Agreement, the granting of
such consent by Lender in any instance shall not constitute continuing consent
to subsequent instances where such consent is required and in al cases such
consent may be granted or withheld in the sole discretion of the Lender.
SEVERABILITY. If a court of competent jurisdiction finds any provision of this
Agreement to be illegal, invalid, or unenforceable as to any circumstance, that
finding shall not make the offending provision illegal, invalid, or
unenforceable as to any other circumstance. If feasible, the offending provision
shall be considered modified so that it becomes legal, valid and enforceable. If
the offending provision cannot be so modified, it shall be considered deleted
from this Agreement. Unless otherwise required by law, the illegality,
invalidity, or unenforceability of any provision of this Agreement shall not
affect the legality, validity or enforceability of any other provision of this
Agreement.
DEFINITIONS. The following capitalized words and terms shall have the following
meanings when used in this Agreement. Unless specifically stated to the
contrary, all references to dollar amounts shall mean amounts in lawful money of
the United States of America. Words and terms used in the singular shall include
the plural, and the plural shall include the singular, as the context may
require. Words and terms not otherwise defined in this Agreement shall have the
meanings attributed to such terms in the Uniform Commercial Code:
Agreement. The word "Agreement" means this Landlord's Consent, as this
Landlord's Consent ma be amended or modified from time to time, together with
all exhibits and schedules attached to this Landlord's Consent from time to
time.
Borrower. The word "Borrower" means Category 5 Technologies, Inc., and all other
persons and entities signing the Note in whatever capacity.
Collateral. The "Collateral" means all of Borrower's right, title and interest
in and to all Collateral as described in the Collateral Description section of
this Agreement.
Landlord. The word "Landlord" means COTTONWOOD REALTY SERVICES, and is used for
convenience purposes only. Landlord's interest in the Premises may be that of a
fee owner, lessor, sublessor or lienholder, or that of any other holder of an
interest in the Premises which may be, or may become, prior to the interest of
Lender.
Lease. The word "Lease" means that certain lease of the Premises, dated
_________________, between Landlord and Borrower.
Lender. The word "Lender" means ZIONS FIRST NATIONAL BANK, its successors and
assigns.
Loan. The word "Loan" means any and all loans and financial accommodations from
Lender to Borrower whether now or hereafter existing, and however evidenced.
Premises. The word "Premises" means the real property.
Related Documents. The words "Related Documents" mean all promissory notes,
credit agreements, loan agreements, environmental agreements, guaranties,
security agreements, mortgages, deeds of trust, security deeds, collateral
mortgages, and all other instruments, agreements and documents, whether now or
hereafter existing, executed in connection with the Loan.
BORROWER AND LANDLORD ACKNOWLEDGE HAVING READ ALL THE PROVISIONS OF THIS
LANDLORD'S CONSENT, AND BORROWER AND LANDLORD AGREE TO ITS TERMS. THIS AGREEMENT
IS DATED AUGUST 7, 2002.
BORROWER:
CATEGORY 6 TECHNOLOGIES, INC.
By: /s/ Xxxx X. Xxxxxxxx
----------------------------------------------
XXXX X. XXXXXXXX, CEO OF CATEGORY 5
TECHNOLOGIES, INC.
LANDLORD: LENDER:
COTTONWOOD REALTY SERVICE ZIONS FIRST NATIONAL BANK
By: X
------------------------ -------------------------
Authorized signer for Authorized Officer
COTTONWOOD REALTY SERVICE
By:
------------------------
Authorized signer for
COTTONWOOD REALTY SERVICE
AGREEMENT TO PROVIDE INSURANCE
Principal: $2,000,000.00
Loan Date: 08-07-2002
Maturity: 09-01-2003
Loan No.: 9001
Call/Coll: 2/7380
Account: 0000000
Officer: 54403
Initials:
References in the shaded area are for Lender's use only and do not limit the
applicability of this document to any particular loan or item. Any item above
containing "***" has been omitted due to text length limitations.
Borrower: CATEGORY 5 TECHNOLOGIES, INC. Lender: ZIONS FIRST NATIONAL BANK
0000 XXXXXXXXXX XXXXXXX, XXXXX 000 XXXX XXXX XXXXXXXXXX BANKING DIVISION
XXXX XXXX XXXX, XX 00000 00 XXXX XXXXX XXXXXX, XXXXX 000
XXXX XXXX XXXX, XX 00000
Grantor: CATEGORY 5 TECHNOLOGIES, INC.
EPENZIO, INC.
0000 XXXXXXXXXX XXXXXXX, XXX 000
XXXX XXXX XXXX, XX 00000
================================================================================
INSURANCE REQUIREMENTS. Grantor, CATEGORY 5 TECHNOLOGIES, INC.; and EPENZIO,
INC. ("Grantor"), understands that insurance coverage is required in connection
with the extending of a loan or the providing of other financial accommodations
to CATEGORY 5 TECHNOLOGIES, INC. ("Borrower") by Lender. These requirements are
set forth in the security documents for the loan. The following minimum
insurance coverages must be provided on the following described collateral (the
"Collateral"):
Collateral: ALL INVENTORY, CHATTEL PAPER, ACCOUNTS, GENERAL
INTANGIBLES AND ALL CONTRACT RECEIVABLES SERVICE BY
DUVERA BILLING SERVICES, LLC., AND OWNED BY EPENZIO,
INC. AND CATEGORY 5 TECHNOLOGIES, INC.: WHETHER ANY OF
THE FOREGOING IS OWNED NOW OR ACQUIRED LATER; ALL
ACCESSIONS, ADDITIONS, REPLACEMENTS AND SUBSTITUTIONS
RELATING TO ANY OF THE FOREGOING. ALL RECORDS OF ANY
KIND RELATING THERETO.
Type: All risks, including fire, theft and liability.
Amount: Full Insurable Value.
Basis: Replacement value.
Endorsments: Lender loss payable clause with stipulation
that coverage will not be cancelled or diminished
without a minimum of 10 days prior written notice
to Lender.
Deductibles: $500.00.
Latest Delivery Date: By the loan closing date.
INSURANCE COMPANY. Grantor may obtain insurance from any insurance company
Grantor may choose that is reasonably acceptable to Lender. Grantor understands
that credit may not be denied solely because insurance was not purchased through
Lender.
INSURANCE MAILING ADDRESS. All documents and other materials relating to
insurance for this loan should be mailed, delivered or directed to the following
address:
ZIONS FIRST NATIONAL BANK
Loan Servicing Group UT RDWG 0187
2460 South 0000 Xxxx
Xxxx Xxxxxx Xxxx. XX 00000
FAILURE TO PROVIDE INSURANCE. Grantor agrees to deliver to Lender, on the latest
delivery date stated above, proof of the required insurance as provided above,
with an effective date of August 7, 2002, or earlier. Grantor acknowledges and
agrees that if Grantor fails to provide any required insurance or fails to
continue such insurance in force, Lender may do so at Grantors expense as
provided in the applicable security document. The cost of any such insurance, at
the option of Lender, shall be added to the indebtedness as provided in the
security document. GRANTOR ACKNOWLEDGES THAT IF LENDER SO PURCHASES ANY SUCH
INSURANCE, THE INSURANCE WILL PROVIDE LIMITED PROTECTION AGAINST PHYSICAL DAMAGE
TO THE COLLATERAL, UP TO AN AMOUNT EQUAL TO THE LESSER OF (1) THE UNPAID BALANCE
OF THE DEBT, EXCLUDING ANY UNEARNED FINANCE CHARGES, OR (2) THE VALUE OF THE
COLLATERAL; HOWEVER, GRANTOR'S EQUITY IN THE COLLATERAL MAY NOT BE INSURED. IN
ADDITION, THE INSURANCE MAY NOT PROVIDE ANY PUBLIC LIABILITY OR PROPERTY DAMAGE
INDEMNIFICATKON AND MAY NOT MEET THE REQUIREMENTS OF ANY FINANCIAL
RESPONSIBILITY LAWS.
AUTHORIZATION. For purposes of insurance coverage on the Collateral, Grantor
authorizes Lender to provide to any person (including any insurance agent or
company) all information Lender deems appropriate, whether regarding the
Collateral, the loan or other financial accommodations, or both.
AGREEMENT TO PROVIDE INSURANCE
Loan No: 9001 (Continued) Page 2
================================================================================
GRANTOR ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS AGREEMENT TO
PROVIDE INSURANCE AND AGREES TO ITS TERMS. THIS AGREEMENT IS DATED AUGUST
7, 2002.
GRANTOR:
CATEGORY 5 TECHNOLOGIES, INC.
By:
----------------------------------
XXXX X XXXXXXXX, CEO of CATEGORY 5
TECHNOLOGIES, INC.
EPENZIO, INC.
By:
----------------------------------
XXXX X. XXXXXXXX, CEO OF EPENZIO, INC.
FOR LENDER USE ONLY
INSURANCE VERIFICATION
DATE: PHONE:
--------------------------------- -------------------
AGENT'S NAME:
-------------------------
AGENCY:
-------------------------------
INSURANCE COMPANY:
--------------------
POLICY NUMBER:
-------------------------
EFFECTIVE DATES:
-------------------------------------------------------------------
--------------------------------------------------------------------------------
COMMENTS:
-----------------------------------------------------------------------
--------------------------------------------------------------------------------
NOTICE OF INSURANCE REQUIREMENTS
Principal:
Loan Date: 08-07-2002
Maturity:
Loan No.: 9001
Call/Coll: 2/7380
Account: 0000000
Officer: 54403
Initials:
References in the shaded area are for Lender's use only and do not limit the
applicability of this document to any particular loan or item. Any item above
containing "***" has been omitted due to text length limitations.
Borrower: CATEGORY 5 TECHNOLOGIES, INC. Lender: ZIONS FIRST NATIONAL BANK
0000 XXXXXXXXXX XXXXXXX, XXXXX 000 XXXX XXXX XXXXXXXXXX BANKING DIVISION
XXXX XXXX XXXX, XX 00000 00 XXXX XXXXX XXXXXX, XXXXX 000
XXXX XXXX XXXX, XX 00000
Grantor: CATEGORY 5 TECHNOLOGIES, INC.
EPENZIO, INC.
0000 XXXXXXXXXX XXXXXXX, XXX 000
XXXX XXXX XXXX, XX 00000
================================================================================
TO: ATTN: Insurance Agent DATE: August 7, 2002
RE: Policy Number(s):
Insurance Companies/Company:
Dear Insurance Agent:
CATEGORY 5 TECHNOLOGIES, INC. ("Borrower"), is obtaining a loan from ZIONS FIRST
NATIONAL BANK. Please send appropriate evidence of insurance to ZIONS FIRST
NATKONAL BANK, together wrth the requested endorsements, on the following
property, which Grantor, CATEGORY 5 TECHNOLOGIES, INC.; and EPENZIO, INC.
("Grantor"} is giving as security for the loan.
Collateral: ALL INVENTORY, CHATTEL PAPER, ACCOUNTS, GENERAL
INTANGIBLES AND ALL CONTRACT RECEIVABLES SERVICE BY
DUVERA BILLING SERVICES, LLC., AND OWNED BY EPENZIO,
INC. AND CATEGORY 5 TECHNOLOGIES, INC.: WHETHER ANY OF
THE FOREGOING IS OWNED NOW OR ACQUIRED LATER; ALL
ACCESSIONS, ADDITIONS, REPLACEMENTS AND SUBSTITUTIONS
RELATING TO ANY OF THE FOREGOING. ALL RECORDS OF ANY
KIND RELATING THERETO.
Type: All risks, including fire, theft and liability.
Amount: Full Insurable Value.
Basis: Replacement value.
Endorsments: Lender loss payable clause with stipulation
that coverage will not be cancelled or diminished
without a minimum of 10 days prior written notice
to Lender.
Deductibles: $500.00.
Latest Delivery Date: By the loan closing date.
GRANTOR:
CATEGORY 5 TECHNOLOGIES, INC.
By:
----------------------------------
XXXX X XXXXXXXX, CEO of CATEGORY 5
TECHNOLOGIES, INC.
EPENZIO, INC.
By:
----------------------------------
XXXX X. XXXXXXXX, CEO OF EPENZIO, INC.
RETURN TO:
ZIONS FIRST NATIONAL BANK
Loan Servicing Group UT RDWG 0187
0000 Xxxxx 0X00 Xxxx
Xxxx Xxxxxx Xxxx, XX 00000
DISBURSEMENT REQUEST AND AUTHORIZATION
Principal: $2,000,000.00
Loan Date: 08-07-2002
Maturity: 09-01-2003
Loan No.: 9001
Call/Coll: 2/7380
Account: 0000000
Officer: 54403
Initials:
References in the shaded area are for Lender's use only and do not limit the
applicability of this document to any particular loan or item. Any item above
containing "***" has been omitted due to text length limitations.
Borrower: CATEGORY 5 TECHNOLOGIES, INC. Lender: ZIONS FIRST NATIONAL BANK
0000 XXXXXXXXXX XXXXXXX, XXXXX 000 XXXX XXXX XXXXXXXXXX BANKING DIVISION
XXXX XXXX XXXX, XX 00000 00 XXXX XXXXX XXXXXX, XXXXX 000
XXXX XXXX XXXX, XX 00000
================================================================================
LOAN TYPE. This is a Variable Rate Nondisclosable Revolving Line of Credit Loan
to a Corporation for $2,000,000.00 due on September 1, 2003. The reference rate
Prime Rate. Prime Rate means an index which is determined daily by the published
commercial loan variable rate index held by any two of the following banks: X.X.
Xxxxxx Xxxxx & Co., Xxxxx Fargo Bank N.A., and Bank of America N.A. In the event
no two of the above banks have the same published rate, the bank having the
median rate will establish the Prime Rate. This definition of Prime Rate is to
be strictly interpreted and is not intended to serve any purpose other than
providing an index to determine the variable interest rate used herein. It is
not the lowest rate at which Zions First National Bank may make loans to any of
its customers, either now or in the future, currently 4.750%) is added to the
margin of 1.000%, resulting in an initial rate of 5.750. This is a secured
renewal of the following described indebtedness: THIS IS A RENEWAL OF A
PROMISSORY NOTE FROM BORROWER TO LENDER DATED SEPTEMBER 11, 2001 IN THE ORIGINAL
PRINCIPAL AMOUNT OF $1,000,000.00.
PRIMARY PURPOSE OF LOAN. The primary purpose of this loan is for:
[ ] Personal, Familyy, or Household Purposes or Personal
investment.
[X] Business (ncluding Real Estate Investment).
SPECIFIC PURPOSE. The specific purpose of this loan is: TO PROVIDE SHORT TERM
ACCOUNT RECEIVABLE WORKING CAPITAL.
DISBURSEMENT INSTRUCTIONS. Borrower understands that no loan proceeds will be
disbursed until all of Lender's conditions for making the loan have been
satisfied. Please disburse the loan proceeds of $2,000,000.00 as follows:
Undisbursed Funds: $993,493.50
Other Disbursements: $998,241.50
$998,241.50 TO RENEW NOTE 9001
Other Charges Financed: $265.00
$40.00 UCC Recording and Post Search
$225.00 Documentation Fee
Tool Financed Prepaid Finance Charges: $8,000.00
$8,000.00 RENEWAL FEE -------------
Note Principal: $2,000,000.00
CHARGES PAID IN CASH. Borrower has paid or will pay in cash as agreed the
following charges:
Prepaid Finance Charges Paid in Cash: $0.00
Other Charges Paid in Cash: $5,739.79
$5,739.79 interest as of August 7, 2002 -----------
Total Charges Paid in Cash: $5,739.79
FINAL AGREEMENT. Borrower understands that the loan documents signed in
connection with this loan are the final expression of the agreement between
Lender and Borrower and may not be contradicted by evidence of any alleged oral
agreement.
FINANCIAL CONDITION. BY SIGNING THIS AUTHORIZATION, BORROWER REPRESENTS AND
WARRANTS TO LENDER THAT THE INFORMATION PROVIDED ABOVE IS TRUE AND CORRECT AND
AND THERE HAS BEEN NO MATERIAL ADVERSE CHANGE IN BORROWER'S FINANCIAL CONDITION
AS DISCLOSED IN BORROWER'S MOST RECENT FINANCAIL STATEMENT TO LENDER. THIS
AUTHORIZATION IS DATED AUGUST 7, 2002.
BORROWER:
CATEGORY 5 TECHNOLOGIES, INC.
By:
----------------------------------
XXXX X XXXXXXXX, CEO of CATEGORY 5
TECHNOLOGIES, INC.
NOTICE OF FINAL AGREEMENT
Principal: $2,000,000.00
Loan Date: 08-07-2002
Maturity: 09-01-2003
Loan No.: 9001
Call/Coll: 2/7380
Account: 0000000
Officer: 54403
Initials:
References in the shaded area are for Lender's use only and do not limit the
applicability of this document to any particular loan or item. Any item above
containing "***" has been omitted due to text length limitations.
Borrower: CATEGORY 5 TECHNOLOGIES, INC. Lender: ZIONS FIRST NATIONAL BANK
0000 XXXXXXXXXX XXXXXXX, XXXXX 000 XXXX XXXX XXXXXXXXXX BANKING DIVISION
XXXX XXXX XXXX, XX 00000 00 XXXX XXXXX XXXXXX, XXXXX 000
XXXX XXXX XXXX, XX 00000
BY SIGNING THIS DOCUMENT EACH PARTY REPRESENTS AND AGREES THAT: (A) THE WRITTEN
LOAN AGREEMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES, (B) THERE ARE
NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES, AND (C) THE WRITTEN LOAN
AGREEMENT MAY NOT BE CONTRADICTED BY EVIDENCE OF ANY PRIOR, CONTEMPORANEOUS, OR
SUBSEQUENT ORAL AGREEMENTS OR UNDERSTANDINGS OF THE PARTIES.
As used in this Notice, the following terms have the following meanings:
Loan. The term "Loan" means the following described loan: a Variable Rate
Nondisclosable Revolving Line of Credit Loan to a Corporation for $2,000,000.00
due on September 1, 2003. The reference rate (Prime Rate. Prime Rate means an
index which is determined daily by the published commercial loan variable rate
index held by any two of the following banks: X.X. Xxxxxx Chase & Co., Xxxxx
Fargo Bank, N.A., and Bank of American N.A. In the event no two of the above
banks have the same published rate, the bank having the median rate will
establish the Prime Rate. This definition of Prime Rate is to be strictly
interpreted and is not intended to serve any purpose other than providing an
index to determine the variable interest rate used herein. It is not the lowest
rate at which Zions First National Bank may make loans to any of its customers,
either now or in the future., currently 4.750%) is added to the margin of
1.000%, resulting in an initial rate of 5.750. This is a secured renewal of the
following described indebtedness: THIS IS A RENEWAL OF A PROMISSORY NOTE FROM
BORROWER TO LENDER DATED SEPTEMBER 11, 2001 IN THE ORIGINAL PRINCIPAL AMOUNT OF
$1,000,000.00.
Loan Agreement. The term "Loan Agreement" means one or more promises, promissory
notes, agreements, undertakings, security agreements, deeds of trust or other
documents, or commitments, or any combination of those actions or documents,
relating to the Loan, including without limitation the following:
LOAN DOCUMENTS
Corporate Resolution: EPENZIO, INC. Corporate Resolution: CATEGORY 5 TECHNOLOGIES, INC.
Business Loan Agreement (Asset Based) Promissory Note
UT Commercial Security Agreement: ALL INVENTORY, Release and Consent
CHATTEL PAPER, ACCOUNTS, GENERAL INTANGIBLES AND NV Revised National UCC FS: ALL INVENTORY, CHATTEL
ALL CONTRACT RECEIVABLES SERVICE BY DUVERA PAPER, ACCOUNTS, GENERAL INTANGIBLES AND ALL CON
BILLING SERVICES, LLC., AND OWNED BY EPENZIO, INC. Agreement to Provide Insurance: ALL INVENTORY, CHATTEL
AND CATEGORY 5 TECHNOLOGIES, INC.; WHETHER ANY OF PAPER, ACCOUNTS, GENERAL INTANGIBLES AND ALL
THE FOREGOING IS OWNED NOW OR ACQURIED LATER; CONTRACT RECEIVABLES SERVICE BY DUVERA BILLING
ALL ACCESSIONS, ADDITIONS, REPLACEMENTS AND SERVICES, LLC., AND OWNED BY EPENZIO, INC. AND
SUBSTITUTIONS RELATING TO ANY OF THE FOREGOING CATEGORY 5 TECHNOLOGIES, INC.; WHETHER ANY OF THE
ALL RECORDS OF ANY KIND RELATING THEREOF.; OWNED FOREGOING IS OWNED NOW OR ACQUIRED LATER; ALL
BY CATEGORY 5 TECHNOLOGIES, INC. AND EPENZIO, INC. ACCESSIONS, ADDITIONS, REPLACEMENTS AND
Notice of Insurance Requirements: SUBSTITUTIONS RELATING TO ANY OF THE FOREGOING, ALL
Disbursement Request and Authorization RECORDS OF ANY KIND RELATING THERETO.; owned by
Notice of Final Agreement CATEGORY 5 TECHNOLOGIES, INC. and EPENZIO, INC.
Parties. The term "Parties" means ZIONS FIRST NATIONAL BANK and any and all
entities or individuals who are obligated to repay the loan or have pledged
property as security for the loan, including without limitation the following:
Borrower: CATEGORY 5 TECHNOLOGIES, INC.
Grantor(s): CATEGORY 5 TECHNOLOGIES, INC.; and EPENZIO, INC.
--------------------------------------------------------------------------------
Each party who signs below, other than ZIONS FIRST NATIONAL BANK, acknowledges,
represents, and warrants to ZIONS FIRST NATIONAL BANK that it has received, read
and understood this Notice of Final Agreement. This Notice is dated August 7,
2002.
BORROWER:
CATEGORY 5 TECHNOLOGIES, INC.
By: /s/
--------------------------------
XXXX X. XXXXXXXX, CEO of CATEGORY 5
TECHNOLOGIES, INC.
NOTICE OF FINAL AGREEMENT
Loan No: 9001 (Continued) Page 2
================================================================================
GRANTOR:
CATEGORY 5 TECHNOLOGIES, INC.
By: /s/
--------------------------------
XXXX X. XXXXXXXX, CEO of CATEGORY 5
TECHNOLOGIES, INC.
EPENZIO, INC.
By: /s/
--------------------------------
XXXX X. XXXXXXXX, CEO of EPENZIO, INC.
LENDER:
ZIONS FIRST NATIONAL BANK
X _______________________________________
Authorized Signer
