EXHIBIT 10.3
SECURITY AGREEMENT
THIS SECURITY AGREEMENT (this "Agreement") is made as of February 14, 2003
by and between SmartServ Online, Inc. a Delaware corporation ("Debtor") and
Global Capital Funding Group, L.P., a Delaware limited partnership ("Secured
Party").
1. Definitions.
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(a) Certain Defined Terms. The following terms, as used herein, have the
meanings set forth below:
"Accounts" means all of the following: (a) accounts receivable, contract
rights, book debts, notes, drafts and other obligations and indebtedness arising
from the sale, lease or exchange of goods or other property and/or the
performance of services; (b) rights in, to and under all purchase orders for
goods, services or other property; (c) rights to any goods, services or other
property represented by any of the foregoing (including returned or repossessed
goods and unpaid sellers' rights of rescission, replevin, reclamation and rights
to stoppage in transit); (d) monies due to or to become due under all contracts
for the sale, lease or exchange of goods or other property and/or the
performance of services (whether or not yet earned by performance); and (e)
Proceeds of any of the foregoing and all collateral security and guaranties of
any kind given by any Person with respect to any of the foregoing.
"Collateral" has the meaning assigned to that term in Section 3.
"Documents" means all "documents" (as defined in the UCC) or other receipts
covering, evidencing or representing goods.
"Equipment" means all "equipment" (as defined in the UCC), including,
without limitation, all machinery, motor vehicles, trucks, trailers, vessels,
aircraft and rolling stock and all parts thereof and all additions and
accessions thereto and replacements therefore.
"Event of Default" has the meaning assigned to that term in Section 9.
"Fixtures" means all plant fixtures, business fixtures, other fixtures and
storage office facilities and all additions and accessions thereto and
replacements therefore.
"General Intangibles" means all "general intangibles" (as defined in the
UCC), including, without limitation: (a) all agreements, leases, licenses and
contracts to which Debtor is or may become a party; (b) all obligations or
indebtedness owing to Debtor (other than Accounts) from
whatever source arising; (c) all tax refunds; (d) all intellectual property; (e)
all choses in action and causes of action; and (f) all trade secrets and other
confidential information relating to the business of Debtor.
"Instruments" means all "instruments," "chattel paper" or "letters of
credit" (each as defined in the UCC) including, but not limited to, promissory
Notes, drafts, bills of exchange and trade acceptances.
"Inventory" means all "inventory" (as defined in the UCC), including,
without limitation, finished goods, raw materials, work in process and other
materials and supplies (including packaging and shipping materials) used or
consumed in the manufacture or production thereof and returned and repossessed
goods.
"Investment Property" means all "investment property" (as defined in the
UCC), including certificated and uncertificated securities, security
entitlements, securities accounts, commodity contracts and commodity accounts
(each as defined in the UCC).
"Note" means that certain 10% Convertible Note of even date herewith, in
the original principal amount of $1,000,000, made and executed by Debtor and
issued to Secured Party, and all amendments and supplements thereto,
restatements thereof and renewals, extensions, restructuring and refinancings
thereof.
"Person" means and includes natural persons, corporations, limited
partnerships, general partnerships, joint stock companies, joint ventures,
associations, companies, trusts, banks, trust companies, land trusts, business
trusts or other organizations, whether or not legal entities, and governments
and agencies and political subdivisions thereof.
"Proceeds" means all proceeds of, and all other profits, rentals or
receipts, in whatever form, arising from the collection, sale, lease, exchange,
assignment, licensing or other disposition of, or realization upon, any
Collateral including, without limitation, all claims against third parties for
loss of, damage to or destruction of, or for proceeds payable under, or unearned
premiums with respect to, policies of insurance with respect to any Collateral,
and any condemnation or requisition payments with respect to any Collateral, in
each case whether now existing or hereafter arising.
"Secured Obligations" has the meaning assigned to that term in Section 4.
"Security Interests" means the security interests granted pursuant to
Section 3, as well as all other security interests created or assigned as
additional security for the Secured Obligations pursuant to the provisions of
this Agreement.
"Securities Purchase Agreement" means that certain Securities Purchase
Agreement of even date herewith, by and between Debtor and Secured Party.
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"UCC" means the Uniform Commercial Code as in effect on the date hereof in
the State of Delaware, provided that if by reason of mandatory provisions of
law, the perfection or the effect of perfection or non-perfection of the
Security Interest in any Collateral or the availability of any remedy hereunder
is governed by the Uniform Commercial Code as in effect on or after the date
hereof in any other jurisdiction, "UCC" means the Uniform Commercial Code as in
effect in such other jurisdiction for purposes of the provisions hereof relating
to such perfection or effect of perfection or non-perfection or availability of
such remedy.
2. Other Definition Provisions. References to "Sections", "subsections",
"Exhibits" and "Schedules" shall be to Sections, subsections, Exhibits and
Schedules, respectively, of this Agreement unless otherwise specifically
provided. Any of the terms defined in Section 1(a) may, unless the context
otherwise requires, be used in the singular or the plural depending on the
reference. All references to statutes and related regulations shall include
(unless otherwise specifically provided herein) any amendments of same and any
successor statutes and regulations.
3. Grant of Security Interests
In order to secure the payment and performance of the Secured Obligations
in accordance with the terms thereof, Debtor hereby grants to Secured Party, a
continuing security interest in and to all right, title and interest of Debtor
in the collateral (and any Proceeds therefrom) described on Exhibit A hereto,
whether now owned or existing or hereafter acquired or arising (all being
collectively referred to as the "Collateral").
4. Security for Obligations
This Agreement secures the payment and performance of the Securities
Purchase Agreement and the Note, and all renewals, extensions, restructuring and
refinancings thereof (the "Secured Obligations").
5. Representations and Warranties. Debtor represents and warrants as
follows:
(a) Binding Obligation. This Agreement is the legally valid and binding
obligation of Debtor, enforceable against Debtor in accordance with its terms,
except as enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium, or similar laws or equitable principles relating to or limiting
creditor's rights generally.
(b) Ownership of Collateral. Except as set forth on Schedule 5(b),
Debtor owns the Collateral free and clear of any lien, security interest or
encumbrance. Except as set forth on Schedule 5(b), no effective financing
statement or other form of lien notice covering all or any part of the
Collateral is on file in any recording office.
(c) Office Locations; Debtor Names.
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(i) As of the date hereof, the chief place of business, the chief
executive office and the office where Debtor keeps its books and
records is located at the place specified on Schedule 5(c)(i)
hereto. Except as set forth on Schedule 5(c)(i), Debtor has not
maintained any other address at any time during the five years
preceding the date hereof.
(ii) Debtor does not do business nor, as of the date hereof, has it
done business during the past five years under any corporate name,
trade name or fictitious business name except for Debtor's corporate
name set forth above.
(d) Perfection. Subject to the release within 10 Business Days of the
liens set forth in Section 5(b), this Agreement, together with the UCC filings
referenced herein, create to secure the Secured Obligations a valid, perfected
and first priority security interest in the Collateral, and all filings and
other actions necessary or desirable to perfect and protect such security
interest have been duly taken.
(e) Governmental Authorizations; Consents. No authorization, approval or
other action by, and no notice to or filing with, any governmental authority or
regulatory body or consent of any other Person is required either (i) for the
grant by Debtor of the Security Interests granted hereby or for the execution,
delivery or performance of this Agreement by Debtor or (ii) for the perfection
of or the exercise by Secured Party of its rights and remedies hereunder (except
as may have been taken by or at the direction of Debtor or Secured Party) other
than the filing of financing statements in connection with the perfection of the
Security Interests.
(f) Value of Collateral. The aggregate value of the collateral as of the
date hereof is equal to not less than $1,000,000.
(g) Accurate Information. All information heretofore, herein or
hereafter supplied to Secured Party by or on behalf of Debtor with respect to
the Collateral is and will be accurate and complete in all material respects.
6. Further Assurances; Covenants
(a) Other Documents and Actions. Debtor will, from time to time, at its
expense, promptly execute and deliver all further instruments and documents and
take all further action that may be necessary or desirable, or that Secured
Party may reasonably request, in order to perfect and protect any security
interest granted or purported to be granted hereby or to enable Secured Party to
exercise and enforce its rights and remedies hereunder with respect to any
Collateral. Without limiting the generality of the foregoing, Debtor will: (i)
execute and file such financing or continuation statements, or amendments
thereto, and such other instruments or notices, as may be necessary or
desirable, or as Secured Party may reasonably request, in order to perfect and
preserve the security interests granted or purported to be granted hereby; (ii)
at any reasonable time, upon demand by Secured Party exhibit the Collateral to
allow inspection of the Collateral by Secured Party or persons
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designated by Secured Party; and (iii) upon Secured Party's request, appear in
and defend any action or proceeding that may affect Debtor's title to or Secured
Party's security interest in the Collateral.
(b) Secured Party Authorized. Debtor hereby authorizes Secured Party to
file one or more financing or continuation statements, and amendments thereto,
relating to all or any part of the Collateral without the signature of Debtor
where permitted by law.
(c) Corporate or Name Change. Debtor will notify Secured Party promptly
in writing at least 30 days prior to (a) any change in Debtor's name and (b)
Debtor's commencing the use of any trade name, assumed name or fictitious name.
(d) Business Locations. Debtor shall give Secured Party thirty (30)
days' prior written notice of any change in its chief place of business or of
any new location of business or any new location for any of the Collateral. With
respect to any new location (which in any event shall be within the continental
United States), Debtor shall execute such documents and take such actions as
Secured Party reasonably deems necessary to perfect and protect the Security
Interests.
(e) Bailees. Except as set forth on Schedule 6(e), no Collateral shall
at any time be in the possession or control of any warehouseman, bailee or
Debtor's agents or processors without Secured Party's prior written consent and
unless Secured Party, if Secured Party has so requested, has received warehouse
receipts or bailee letters reasonably satisfactory to Secured Party prior to the
commencement of such storage. Debtor shall, upon the request of Secured Party,
notify any such warehouseman, bailee, agent or processor of the Security
Interests.
(f) Insurance. Debtor shall maintain insurance with respect to the
Collateral of types and in amounts that are customary for similarly situated
businesses. Debtor hereby directs all insurers under such policies of insurance
with respect to its assets to pay all material proceeds of such insurance
policies to Secured Party, up to the principal and interest due on the Note.
(g) Taxes and Claims. Debtor will pay (i) all taxes, assessments and
other governmental charges imposed upon the Collateral before any penalty
accrues thereon and (ii) all claims (including claims for labor, services,
materials and supplies) for sums that have become due and payable and that by
law have or may become a lien upon any of the Collateral before any penalty or
fine is incurred with respect thereto; provided that no such tax, charge or
claim need be paid if a Debtor is contesting same in good faith by appropriate
proceedings promptly instituted and diligently conducted and if Debtor has
established such reserve or other appropriate provision, if any, as shall be
required in conformity with generally accepted accounting principles
consistently applied.
(h) Collateral Description. Debtor will furnish to Secured Party, from
time to time, statements and schedules further identifying and describing the
Collateral and such other reports in connection with the Collateral as Secured
Party may reasonably request, all in reasonable detail.
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(i) Use of Collateral. Debtor will not use or permit any Collateral to
be used unlawfully or in violation of any provision of this Agreement or any
applicable statute, regulation or ordinance or any policy of insurance covering
any of the Collateral.
(j) Records of Collateral. Debtor shall keep full and accurate books and
records relating to the Collateral and shall stamp or otherwise mark such books
and records in such manner as Secured Party may reasonably request indicating
that the Collateral is subject to the Security Interests.
(k) Other Information. Debtor will, promptly upon request, provide to
Secured Party all information and evidence it may reasonably request concerning
the Collateral to enable Secured Party to enforce the provisions of this
Agreement.
7. Secured Party Appointed Attorney-in-Fact. Debtor hereby irrevocably
appoints Secured Party as its attorney-in-fact, with full authority in the place
and stead of Debtor and in the name of Debtor, Secured Party or otherwise, from
time to time in Secured Party's discretion to take any action and to execute any
instrument that Secured Party may deem necessary or advisable after the
occurrence and during the continuation of an Event of Default to accomplish the
purposes of this Agreement, including, without limitation:
(a) to obtain and adjust insurance required to be paid to Secured Party;
(b) to ask, demand, collect, sue for, recover, compound, receive and
give acquittance and receipts for monies due and to become due under or in
respect of any of the Collateral;
(c) to file any claims or take any action or institute any proceedings
that Secured Party may deem necessary or desirable for the collection of any of
the Collateral or otherwise to enforce the rights of Secured Party with respect
to any of the Collateral;
(d) to pay or discharge taxes or liens, levied or placed upon or
threatened against the Collateral, the legality or validity thereof and the
amounts necessary to discharge the same to be determined by Secured Party in its
sole discretion, and such payments made by Secured Party to become obligations
of Debtor, due and payable immediately without demand and secured by the
Security Interests; and
(e) generally to sell, transfer, pledge, make any agreement with respect
to or otherwise deal with any of the Collateral as fully and completely as
though Secured Party were the absolute owner thereof for all purposes, and to
do, at Secured Party's option and Debtor's expense, at any time or from time to
time, all acts and things that Secured Party deems necessary to protect,
preserve or realize upon the Collateral.
Neither Secured Party nor any Person designated by Secured Party shall be liable
for any acts or omissions or for any error of judgment or mistake of fact or law
other than as a result of Secured
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Party's or such Person's gross negligence or willful misconduct. This power,
being coupled with an interest, is irrevocable so long as this Agreement shall
remain in force.
8. Transfers and Other Liens
Debtor shall not without Secured Party's prior written consent:
(a) Sell, assign (by operation of law or otherwise) or otherwise dispose
of, or grant any option with respect to, any of the Collateral.
(b) Create or suffer to exist any lien, security interest or other
charge or encumbrance upon or with respect to any of the Collateral to secure
indebtedness of any Person except for the security interest created by this
Agreement.
9. Events of Default.
The occurrence of any one or more of the following events shall
constitute an Event of Default by Debtor under this Agreement:
(a) General Default. Debtor shall fail to observe or perform any
covenant, obligation, term or condition contained in the Securities Purchase
Agreement, the Note, or this Agreement.
(b) Nonpayment. Debtor shall fail to pay any principal, interest or
other amount owing under the Note or Securities Purchase Agreement when and as
the same shall be due and payable.
(c) Material Misrepresentations. Any representation or warranty of the
Debtor set forth herein shall prove to have been false in any material respect
at the time it was given.
(d) Going Concern. Debtor shall terminate its corporate existence or
shall cease to operate as a going concern.
(e) Other. The occurrence of any "Event of Default" as that term is
defined in Securities Purchase Agreement that is not cured within the applicable
cure period.
10. Remedies
(a) If any Event of Default shall have occurred and be continuing,
Secured Party may declare the entire outstanding principal amount of the Note
immediately due and payable.
(b) If any Event of Default shall have occurred and be continuing,
Secured Party may exercise in respect of the Collateral, in addition to all
other rights and remedies provided for herein or otherwise available to it, all
the rights and remedies of a secured party on default under the
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UCC (whether or not the UCC applies to the affected Collateral) and also may:
(i) require Debtor to, and Debtor hereby agrees that it will, at its expense and
upon request of Secured Party forthwith, assemble all or part of the Collateral
as directed by Secured Party and make it available to Secured Party at a place
to be designated by Secured Party which is reasonably convenient to both
parties; (ii) without notice or demand or legal process, enter upon any premises
of Debtor and take possession of the Collateral; (iii) without notice except as
specified below, sell the Collateral or any part thereof in one or more parcels
at public or private sale, at any of Secured Party's offices or elsewhere, at
such time or times, for cash, on credit or for future delivery, and at such
price or prices and upon such other terms as Secured Party may deem commercially
reasonable; (iv) notify the obligors on any Accounts or Instruments to make
payments thereunder directly to Secured Party; and (v) without notice to Debtor,
renew, modify or extend any of the Accounts and Instruments or grant waivers or
indulgences with respect thereto or accept partial payment thereof, or
substitute any obligor thereon, in any manner as Secured Party may deem
advisable, without affecting or diminishing Debtor's continuing obligations
hereunder. Debtor agrees that, to the extent notice of sale shall be required by
law, at least ten days' notice to Debtor of the time and place of any public
sale or the time after which any private sale is to be made shall constitute
reasonable notification. At any sale of the Collateral, if permitted by law,
Secured Party may bid (which bid may be, in whole or in part, in the form of
cancellation of indebtedness) for the purchase of the Collateral or any portion
thereof for the account of Secured Party. Secured Party shall not be obligated
to make any sale of Collateral regardless of notice of sale having been given.
Secured Party may adjourn any public or private sale from time to time by
announcement at the time and place fixed therefore, and such sale may, without
further notice, be made at the time and place to which it was so adjourned. To
the extent permitted by law, Debtor hereby specifically waives all rights of
redemption, stay or appraisal which it has or may have under any law now
existing or hereafter enacted.
(c) Upon the occurrence of an Event of Default hereunder, Secured Party
shall have the right to enter upon the premises of Debtor where the Collateral
is located (or is believed to be located) without any obligation to pay rent to
Debtor, or any other place or places where the Collateral is believed to be
located and kept, to render the Collateral useable or saleable, to remove the
Collateral therefrom to the premises of Secured Party or any agent of Secured
Party for such time as Secured Party may desire in order to effectively collect
or liquidate the Collateral, and/or to require Debtor to assemble the Collateral
and make it available to Secured Party at a place or places to be designated by
Secured Party. Upon the occurrence of an Event of Default hereunder, Secured
Party shall have the right to take possession of Debtor's original books and
records, to obtain access to Debtor's data processing equipment, computer
hardware and software relating to the Collateral and to use all of the foregoing
and the information contained therein in any manner Secured Party deems
appropriate; and Secured Party shall have the right to notify postal authorities
to change the address for delivery of Debtor's mail to an address designated by
Secured Party and to receive, open and dispose of all mail addressed to Debtor.
11. Limitation on Duty of Secured Party with Respect to Collateral. Beyond
the safe custody thereof, Secured Party shall have no duty with respect to any
Collateral in its possession or control (or in the possession or control of any
agent or bailee) or with respect to any income thereon or the preservation of
rights against prior parties or any other rights pertaining thereto. Secured
Party
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shall be deemed to have exercised reasonable care in the custody and
preservation of the Collateral in its possession if the Collateral is accorded
treatment substantially equal to that which it accords its own property. Secured
Party shall not be liable or responsible for any loss or damage to any of the
Collateral, or for any diminution in the value thereof, by reason of the act or
omission of any warehouseman, carrier, forwarding agency, consignee or other
agent or bailee selected by Secured Party in good faith.
12. Application of Proceeds. Upon the occurrence and during the continuance
of an Event of Default, the proceeds of any sale of, or other realization upon,
all or any part of the Collateral shall be applied: first, to all fees, costs
and expenses incurred by Secured Party with respect to the Collateral; and
second, to the Secured Obligations. Secured Party shall pay over to Debtor any
surplus and Debtor shall remain liable for any deficiency.
13. Expenses. Debtor agrees to pay all insurance expenses and all expenses
of protecting, storing, warehousing, appraising, insuring, handling, maintaining
and shipping the Collateral, all costs, fees and expenses of perfecting and
maintaining the Security Interests, and any and all excise, property, sales and
use taxes imposed by any state, federal or local authority on any of the
Collateral, or with respect to periodic appraisals and inspections of the
Collateral, or with respect to the sale or other disposition thereof. If Debtor
fails promptly to pay any portion of the above expenses when due or to perform
any other obligation of Debtor under this Agreement, Secured Party may, at its
option, but shall not be required to, pay or perform the same, and Debtor agrees
to reimburse Secured Party therefore on demand. All sums so paid or incurred by
Secured Party for any of the foregoing, any and all other sums for which Debtor
may become liable hereunder and all costs and expenses (including attorneys'
fees, legal expenses and court costs) incurred by Secured Party in enforcing or
protecting the Security Interests or any of their rights or remedies under this
Agreement shall be payable on demand, shall constitute Secured Obligations,
shall bear interest until paid at the rate provided in the Note and shall be
secured by the Collateral.
14. Termination of Security Interests; Release of Collateral. Upon payment
in full of all Secured Obligations, this Agreement shall terminate the Security
Interests and all rights to the Collateral shall revert to Debtor. Upon such
termination of the Security Interests or release of any Collateral, Secured
Party will, at the expense of Debtor, execute and deliver to Debtor such
documents as Debtor shall reasonably request to evidence the termination of the
Security Interests or the release of such Collateral, as the case may be.
15. Notices. Each notice, communication and delivery under this Agreement:
(a) shall be made in writing signed by the party giving it; (b) shall specify
the section of this Agreement pursuant to which given; (c) shall either be
delivered in person or by telecopier, a nationally recognized next business day
courier service or Express Mail; (d) unless delivered in person, shall be given
to the address specified below; (e) shall be deemed to be given (i) if delivered
in person, on the date delivered, (ii) if sent by telecopier, on the date of
telephonic confirmation of receipt, (iii) if sent by a nationally recognized
next business day courier service with all costs paid, on the next business day
after it is delivered to such courier, or (iv) if sent by Express Mail (with
postage and other fees paid), on the next business day after it is mailed. Such
notice shall not be effective unless copies are
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provided contemporaneously as specified below, but neither the manner nor the
time of giving notice to those to whom copies are to be given (which need not be
the same as the addressee) shall control the date notice is given or received.
The addresses and requirements for copies are as follows:
If to Debtor:
SmartServ Online, Inc.
Metro Center
One Station Place
Stamford, CT 06902
Telecopier No. 203-353-5962
Confirmation No. 203-353-5950
Attention: Chief Financial Officer
If to Secured Party:
Global Capital Funding Group, L.P.
106 Colony Park Drive
Suite 900
Cumming, GA 30040
Attn: Lewis N. Lester
Telecopier No.678-947-6499
Confirmation No.678-947-0028
with a copy to:
Global Capital Advisors, Ltd.
106 Colony Park Drive, Suite 900
Cumming, GA 30040
Attention: Sharon Bauer Berman
Telecopier No. 678-947-6499
16. Waivers, Non-Exclusive Remedies, Severability. Except as otherwise
expressly set forth in any particular provision of this Agreement, any consent
or approval required or permitted by this Agreement to be given by Secured Party
may be given, and any term of this Agreement or of any other instrument related
hereto or mentioned herein may be amended, and the performance or observance by
Debtor of any term of this Agreement, the Securities Purchase Agreement or the
Note may be waived (either generally or in a particular instance and either
retroactively or prospectively) with, but only with, the written specific
consent of Secured Party. No waiver shall extend to or affect any obligation not
expressly waived or impair any right consequent thereon. No course of dealing or
delay or omission on the part of Secured Party in exercising any right shall
operate as a waiver thereof or otherwise be prejudicial thereto. No notice to or
demand upon Debtor shall entitle Debtor to other or further notice or demand in
similar or other circumstances. The rights in this Agreement, the Securities
Purchase Agreement and the Note are cumulative and are not exclusive of any
other
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remedies provided by law. The invalidity, illegality or unenforceability of any
provision in or obligation under this Agreement shall not affect or impair the
validity, legality or enforceability of the remaining provisions or obligations
under this Agreement.
17. Successors and Assigns. This Agreement is for the benefit of Secured
Party and its successors and assigns, and in the event of an assignment of all
or any of the Secured Obligations, the rights hereunder, to the extent
applicable to the Secured Obligations so assigned, may be transferred with such
Secured Obligations. This Agreement shall be binding on Debtor and its
successors and assigns, provided that Debtor shall not assign this Agreement
without Secured Party's prior written consent.
18. Changes in Writing. No amendment, modification, termination or waiver
of any provision of this Agreement or consent to any departure by Debtor
therefrom, shall in any event be effective without the written concurrence of
Secured Party and Debtor.
19. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware, without giving effect to the
conflicts of law principles thereof.
20. Headings. Cross reference pages and headings contained herein are for
convenience of reference only, do not constitute a part of this Agreement, and
shall not be deemed to limit or affect any of the provisions hereof.
21. Counterparts. This Agreement may be executed by each party upon a
separate copy, and in such case one counterpart of this Agreement shall consist
of enough of such copies to reflect the signatures of all of the parties. This
Agreement may be executed in two or more counterparts, each of which shall be an
original, and each of which shall constitute one and the same agreement. Any
party may deliver an executed copy of this Agreement and of any documents
contemplated hereby by facsimile transmission to another party and such delivery
shall have the same force and effect as any other delivery of a manually signed
copy of this Agreement or of such other documents.
SIGNATURE PAGE FOLLOWS
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DULY EXECUTED and delivered by the parties on the date first written above.
SMARTSERV ONLINE, INC.
By: /s/ Thomas W. Haller
-------------------------------------
Name: Thomas W. Haller
Title: Senior Vice President and
and Chief Financial Officer
GLOBAL CAPITAL FUNDING GROUP, L.P.
By its General Partner, Global Capital
Management Services, Inc.
By: /s/ Lewis N. Lester
-----------------------------------
Name: Lewis N. Lester
Title: President
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EXHIBIT A
COLLATERAL
All right, title and interest of Debtor now owned or hereafter acquired in
and to the following (collectively, the "Collateral"):
(1) All equipment, including but not limited to all computer data
communications and network control equipment, storage devices, software
(excluding software which is created, developed, modified or customized by
the Debtor for sale or lease by the Debor to others), and firmware, and all
additions, accessions, substitutions, attachments, improvements, repairs
thereto, and all fixtures;
(2) All accounts, contracts rights, inventory, general intangibles (excluding
software which is created, developed, modified or customized by the Debtor
for sale or lease by the Debtor to others), chattel paper, documents,
letter of credit rights, investment property, tax refund and insurance
proceeds of the Debtor; and
(3) All products and proceeds of the foregoing, and, in any event, (a) any and
all proceeds of any insurance, indemnity or warranty payable to the Debtor
from time to time with respect to any of the Collateral, (b) any and all
payments made or due and payable to the Debtor from time to time in
connection with any requisition, confiscation, condemnation, seizure or
forfeiture of all or any part of the Collateral by any governmental
authority, (c) any and all recoveries by the Debtor against third parties
with respect to any litigation or dispute concerning any of the Collateral,
and (d) any and all other amounts from time to time paid or payable under
or in connection with any of the Collateral, upon disposition or otherwise.
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SCHEDULE 5(b)
PRIOR SECURITY INTEREST
Hewlett-Packard lien resulting from the secured lending facility entered into on
September 28, 2000, as amended on September 9, 2002:
All right, title and interest of SmartServ Online, Inc. ("Debtor") now
owned or hereafter acquired in and to the following (collectively, the
"Collateral"):
(1) All Hewlett-Packard equipment and other equipment, including but not
limited to all computer data communications and network control equipment,
storage devices, software (excluding software which is created, developed,
modified or customized by the Debtor for sale or lease by the Debor to
others), and firmware, and all additions, accessions, substitutions,
attachments, improvements, repairs thereto, and all fixtures;
(2) All accounts, contracts rights, inventory, general intangibles (excluding
software which is created, developed, modified or customized by the Debtor
for sale or lease by the Debtor to others), chattel paper, documents,
letter of credit rights, investment property, tax refund and insurance
proceeds of the Debtor; and
(3) All products and proceeds of the foregoing, and, in any event, (a) any and
all proceeds of any insurance, indemnity or warranty payable to the Debtor
from time to time with respect to any of the Collateral, (b) any and all
payments made or due and payable to the Debtor from time to time in
connection with any requisition, confiscation, condemnation, seizure or
forfeiture of all or any part of the Collateral by any governmental
authority, (c) any and all recoveries by the Company against third parties
with respect to any litigation or dispute concerning any of the Collateral,
and (d) any and all other amounts from time to time paid or payable under
or in connection with any of the Collateral, upon disposition or otherwise.
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SCHEDULE 5(c)(i)
PRINCIPAL BUSINESS ADDRESS
The following address is the chief place of business, the chief executive
office, and the office where the books and records are kept:
SmartServ Online, Inc.
One Station Place, Stamford, CT 06902
15
SCHEDULE 5(d)(i)
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SCHEDULE 6(e)
WHAREHOUSED COLLATERAL
Certain computer hardware and equipment is wharehoused at the following
location:
Wm. B. Meyer
Moving and Storage
181 Rte 117 Bypass
Bedford Hills, NY 10507
Contact: Pat or Stan - 914-243-0100
17