EXHIBIT 10.47
SECURITY AGREEMENT
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THIS SECURITY AGREEMENT is entered into effective as of the 1/st/ day of
July 1996, by and between LETRONIX ACQUISITION CORP., a Florida corporation,
(hereinafter referred to as "Debtor") and Polyphase Corporation, a Texas
corporation with its principal place of business at 00000 Xxxxxx Xxxxxxx,
Xxxxxx, Xxxxxx Xxxxxx, Xxxxx 00000, (hereinafter collectively "Secured Party").
The undersigned Debtor hereby grants to the above named Secured Party a
Security Interest, under the Uniform Commercial Code, in the following described
property (hereinafter referred to as "Collateral") subject to all applicable
conditions contained herein and including all proceeds, products and accessions
thereto:
1. All of the assets owned by its subsidiary Micro Configurations, Inc., a
New York corporation, including without limitation: accounts, equipment and
general intangibles, both as of the date hereof and hereafter acquired.
2. Two Hundred (200) shares of common stock of Micro Configurations, Inc.,
being one hundred percent (100%) of the issued and outstanding shares of
the common stock of said Company.
DEBTOR WARRANTS, REPRESENTS AND AGREES:
1. The Debtor is a corporation duly organized and existing pursuant to the
laws of the State of Florida and is in good standing with the state of
Florida.
2. The Debtor will not allow the Collateral to be the subject of any other
security interest from and after the date of the execution hereof, except
as set forth hereinbelow, without the express written consent of the
Secured Party.
SECURED OBLIGATION:
This Security Interest will secure the payment of those certain Promissory
Notes of even date herewith, executed by the Debtor as maker thereof and payable
to the order of the Secured Parties, for the payment of the aggregate principal
amount of NINE HUNDRED FIFTY-ONE THOUSAND FOUR HUNDRED THIRTY-TWO DOLLARS AND
NINETY-NINE CENTS ($951,432.99), plus interest, subject to the terms and
conditions as outlined therein.
THE OCCURRENCE OF ANY OF THE FOLLOWING EVENTS SHALL CONSTITUTE A DEFAULT:
1. Failure of Debtor to pay when due, by acceleration or otherwise, any
amount payable under the Secured Obligation;
2. Failure to perform any agreement of Debtor contained herein;
3. The Company shall (a) execute an assignment for the benefit of
creditors, (b) admit in writing its inability to pay its debts generally as
they become due, (c) voluntarily seek the benefits of any Debtor Relief Law
which could suspend or otherwise effect Payee's rights hereunder, or (d)
take any corporate action to authorize any of the forgoing.
Whenever a Default shall exist, the Secured Party may, at their option and
without demand or notice, declare all or any part of the unpaid balance of the
Promissory Notes plus accrued interest of the Secured Obligations immediately
due and payable, and the Secured Party may exercise, in addition to the rights
and remedies granted hereby, all rights and remedies of a Secured Party under
the Uniform Commercial Code or any other applicable law, including the right to
take possession of the Collateral. In addition, for the purpose of taking
possession of the Collateral, the Secured Party may, as far as the Debtor can
give authority therefor, enter upon any premises on which the Collateral or any
part thereof may be situated, and remove the same therefrom.
Debtor agrees, in the event of Default, to make the Collateral available to
the Secured Party at a place or places acceptable to Secured Party and, when
legally permissible, to pay all costs of the Secured Party, including reasonable
attorney's fees, in the collection of the Secured Obligation and the enforcement
of any of the Secured Party's rights. If any notification of intended
disposition of any of the Collateral is required by law, such notification shall
be deemed reasonably and properly given if mailed at least ten (10) days before
such disposition, postage prepaid, addressed to the Debtor at the address shown
on the first page of this Security Agreement.
THE SECURED PARTY SHALL HAVE THE AUTHORITY, BUT SHALL NOT BE OBLIGATED TO:
1. To place upon Debtor's books and records relating to the Accounts and
Contract Rights covered by the Security Interest granted hereby a notation
or legend stating that such Account or Contract Rights are subject to a
Security Interest held by the Secured Party.
2. After any default, to take possession of all Collateral or such part or
parts of the Collateral as may be necessary or appropriate in the judgment
of the Secured Party.
3. After any default, in the name of the Debtor or otherwise, to demand,
collect, receive and receipt for, compound, compromise, settle and give
acquittance for, and prosecute and discontinue any suits or proceedings in
respect of any or all of the Collateral.
4. After any default, take any action which the Secured Party may deem
necessary or desirable in order to realize on the Collateral, including,
without limitation, the power to perform any contract, to endorse in the
name of Debtor any checks, drafts, notes or other instruments or documents
received in payment of or on account of the Collateral.
GENERAL TERMS AND CONDITIONS:
1. Debtor will keep accurate books, records and accounts with respect to
the Collateral and will make the same available to the Secured Party at
their request for examination and inspection; and will make and render to
the Secured Party such reports, accountings and statements as the Secured
Party from time to time may request with respect to the Collateral.
2. Debtor has or will acquire title to and will at all times keep the
Collateral free of all liens and encumbrances, except the Security Interest
created hereby, unless any such lien is expressly subordinate hereto and
has been pre-approved in writing by the Secured Party.
3. Debtor will at any time or times hereafter execute such financing
statements and other instruments and perform such acts as the Secured Party
may request to establish and maintain a valid Security Interest in the
Collateral, and will pay all costs of filing and recording, or, when
legally permissible, Debtor authorizes the Secured Party at the expense of
the Debtor to execute and file on Debtor's behalf a financing statement or
statements in those public offices deemed necessary by the Secured Party to
protect their Security Interest in the Collateral. Debtor will deliver or
cause to be delivered to the Secured Party any certificate or certificates
of title to the Collateral with the Security Interest of the Secured Party
noted thereon.
No delay or failure by the Secured Party in the exercise of any right or
remedy shall constitute a waiver thereof, and no single or partial exercise by
the Secured Party of any right or remedy shall preclude other or further
exercise thereof or the exercise of any other right or remedy. In case any one
or more of the provisions of this Agreement shall for any reason be held to be
invalid, illegal, or unenforceable in any respect, such invalidity, illegality
and unenforceability shall not affect any other provision of this Agreement.
This Security Agreement and the provisions hereof are to be binding upon
the Debtor and any successors of Debtor and benefit the heirs, executors,
administrators and successors of Secured Party. The singular when used herein
shall include the plural and the meaning of words shall apply to masculine and
feminine as is appropriate. The validity, construction and enforcement of this
Agreement are governed by the internal laws of the state of Texas as pre-empted
by federal law. All terms not otherwise defined have the meanings assigned to
them by the Uniform Commercial Code. Invalidity or unenforceability of any
provision of this agreement shall not affect the validity or enforceability of
any other provisions.
A carbon, photographic or other reproduction of this Security Agreement is
sufficient as a financing statement, except where prohibited by law.
This Security Agreement or any other similar document may be filed by any
Secured Party with any state or county agencies where the filing of security
instruments is allowed.
Upon actual receipt of the final payment of the Secured Indebtedness, the
Secured Party hereunder agrees to execute any written memorandum as required by
the Debtor hereunder to release and extinguish the Security Interest created
hereby.
EXECUTED effective as of the day first above written.
DEBTOR
LETRONIX ACQUISITION CORP.
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BY: Xxxxxx X. Xxxxx, Xx.
ITS: President
SECURED PARTY
POLYPHASE CORPORATION
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BY:
ITS:
