EXHIBIT 10.26
SECURITY AGREEMENT
------------------
THIS SECURITY AGREEMENT (this "Security Agreement") is made this
31st day of July, 1996, by and between:
VEECO INSTRUMENTS INC., a Delaware corporation, having an office
at Terminal Drive, Plainview, New York 11803 (hereinafter referred to as
the "Debtor"), and
FLEET BANK, N.A., a national banking association organized under
the laws of the United States of America, having an office at 300 Broad
Hollow Road, Melville, New York 11747 (hereinafter referred to as the
"Agent"), as collateral agent for FLEET BANK, N.A., and THE CHASE MANHATTAN
BANK (hereinafter collectively referred to as the "Secured Parties").
W I T N E S S E T H
- - - - - - - - - -
WHEREAS, the Secured Parties and the (the "Debtor") entered into
a Credit Agreement dated July 31, 1996 (as it may hereafter be amended or
otherwise modified from time to time, being the "Agreement") pursuant to
which the Secured Parties may lend to the Debtor the aggregate principal
amounts set forth therein, upon and subject to the terms and conditions
thereof;
WHEREAS, it is a condition precedent to the obligation of the
Secured Parties to extend credit to the Debtor provided for in the
Agreement that the Debtor shall execute and deliver this Security
Agreement; and
WHEREAS, all capitalized terms used herein without definition
shall have the respective meanings ascribed thereto in the Agreement.
NOW, THEREFORE, in consideration of the premises and in order to
induce the Secured Parties to continue to extend credit to the Debtor, the
Debtor agrees with the Agent and the Secured Parties as follows:
1. Security Interest.
-----------------
(a) Grant of Security. As security for the Obligations (as
-----------------
defined in Section 1(b) hereof), the Debtor hereby assigns and pledges to
the Agent on behalf of the Secured Parties, and hereby grants to the Agent
on behalf of the Secured Parties a security interest in, all of the
Debtor's right, title and interest, whether now existing or hereafter
arising or acquired, in and to the following (collectively, the
"Collateral"):
(i) All personal property of the Debtor, whether now or
hereafter existing or now owned or hereafter acquired and wherever located,
of every kind and description, tangible or intangible, including, without
limitation, the balance of every deposit account now or hereafter existing
of the Debtor with the Secured Parties or any of them or any of their
affiliates or with any
agent of the Secured Parties or any of them or any of their affiliates to
the extent such account is maintained by such agent in its capacity as
agent of any kind for the Secured Parties or any of them or any of their
affiliates, and all goods, equipment, furniture, inventory (including,
without limitation all raw materials, furnished goods and work-in-process),
accounts, contract rights, chattel paper, notes receivable, instruments,
documents (including, without limitation, documents of title, warehouse
receipts and all other shipping documents and instruments of any kind
whatsoever, whether relating to goods in transit or otherwise), general
intangibles, credits, claims, demands and any other obligations of any
kind, whether now or hereafter arising, of the Debtor, and, as to all of
the foregoing, any and all additions and accessions thereto, all
substitutions and replacements therefor and all products and proceeds
thereof (including, without limitation, all proceeds of insurance thereon).
The term "accounts" shall mean, without limiting the
generality of the foregoing, any and all now existing or hereafter arising
rights to payment held by the Debtor, whether in the form of accounts
receivable, notes, drafts, acceptances or other forms of obligations and
receivables now or hereafter received by or belonging to the Debtor for (A)
inventory sold or leased by it, (B) services rendered by it, or (C)
advances or loans made by it to customers, together with all guarantees and
security therefor and all proceeds thereof, whether cash proceeds or
otherwise, including, without limitation, all right, title and interest of
the Debtor in the inventory which gave rise to any such accounts,
including, without limitation, the right to stoppage in transit and all
returned, rejected, rerouted or repossessed inventory.
(ii) All choses in action, any rights arising under any
judgment, statute or rule, all corporate and business records, customer
lists, credit files, computer program print-outs, and other computer
materials and records, all inventories, trademarks, trade styles, trade
names, designs, patents, copyrights, licenses, license agreements, and any
applications for patents and/or trademarks.
(iii) Any and all additions and accessions to the foregoing
Collateral, all substitutions and replacements therefor and all products
and proceeds thereof (including, without limitation, proceeds of insurance
thereon).
(b) Security for Obligations. This Security Agreement secures
------------------------
the payment of all obligations of Debtor to the Secured Parties, or any of
them, now or hereafter existing under the Agreement or this Security
Agreement, including in each case, any modifications or amendments thereto,
or under any promissory notes or other documents evidencing indebtedness
under or related to or contemplated by the Agreement, or any other
obligation of Debtor to the Secured Parties, whether for principal,
interest, fees, expenses or otherwise, together with all costs of
collection or enforcement, including, without limitation, reasonable
attorneys' fees incurred in any collection efforts or in any judicial
proceeding (including, without limitation, bankruptcy or reorganization)
(all such obligations being the "Obligations").
(c) Debtor Remains Liable. Anything herein to the contrary
---------------------
notwithstanding, (i) the Debtor shall remain liable to perform all of its
duties and obligations under the transactions giving rise to the Collateral
to the same extent as if this Security Agreement had not been executed,
2
(ii) the exercise by the Agent on behalf of the Secured Parties of any of
the rights hereunder shall not release the Debtor from any of its duties or
obligations under the transactions giving rise to the Collateral, which
shall remain unchanged as if this Security Agreement had not been executed,
and (iii) neither the Agent nor any of the Secured Parties shall have any
obligation or liability under the transactions giving rise to the
Collateral by reason of this Security Agreement, nor shall the Agent or any
of the Secured Parties be obligated to perform any of the obligations or
duties of the Debtor thereunder or to take any action to collect or enforce
any claim for payment assigned hereunder.
(d) Continuing Agreement. This Security Agreement shall create
--------------------
a continuing security interest in the Collateral and shall remain in full
force and effect until payment in full of the Obligations and until the
Agreement shall no longer be in effect.
2. Debtor's Title; Liens and Encumbrances.
--------------------------------------
The Debtor represents and warrants that the Debtor is, or to the
extent that this Security Agreement states that the Collateral is to be
acquired after the date hereof, will be, the owner of the Collateral,
having good and marketable title thereto, free from any and all liens,
security interests, encumbrances and claims. The Debtor will not create or
assume or permit to exist any such lien, security interest, encumbrance or
claim on or against the Collateral except as created by this Security
Agreement or as permitted pursuant to Section 8.2 of the Agreement, and the
Debtor will promptly notify the Agent of any such other claim, lien,
security interest or other encumbrance made or asserted against the
Collateral and will defend the Collateral against any such claim, lien,
security interest or other encumbrance.
3. Representations and Warranties;
Location of Collateral and Records;
Business and Trade Names of Debtor.
----------------------------------
(a) The Debtor represents and warrants that it has no place of
business, offices where Debtor's books of account and records are kept, or
places where the Collateral is used, stored or located, except as set forth
on Schedule I annexed hereto, and covenants that the Debtor will promptly
notify the Agent of any change in the foregoing representation. The Debtor
shall at all times maintain its records as to the Collateral at its chief
place of business at the address referred to on Schedule I and at none
other. The Debtor further covenants that except for Collateral delivered
to the Agent or an agent for the Agent, the Debtor will not store, use or
locate any of the Collateral at any place other than as listed on Schedule
I annexed hereto. To the extent that any Collateral is located at a
location which is not owned by the Debtor, the Debtor shall deliver to the
Agent, for the benefit of the Secured Parties, landlords waivers in form
and substance satisfactory to the Secured Parties.
(b) The Debtor represents and warrants that it currently uses,
and during the last five years has used, no business or trade names, except
as set forth in Schedule 1 annexed hereto, and covenants that the Debtor
will promptly notify the Agent, in sufficient detail, of any changes in,
additions to, or deletions from the business or trade names used by the
Debtor for billing purposes.
3
(c) The Debtor represents and warrants that upon the filing of
financing statements on Form UCC-1 in the jurisdictions listed on Schedule
1 hereto, the liens granted hereunder shall be perfected and, subject to
the Permitted Liens, shall constitute first priority security interests in
the Collateral.
(d) The Debtor represents and warrants that it has complied and
is in compliance with the provisions of the Fair Labor Standards Act,
including, without limitation, the minimum wage and overtime rules of that
Act, and covenants that the Debtor will continue to comply with the
provisions of such Act.
4. Perfection of Security Interest.
-------------------------------
The Debtor will execute all such financing statements pursuant to
the Uniform Commercial Code or other notices appropriate under applicable
law, as the Agent or the Secured Parties may require to perfect the
security interest in the Collateral created hereunder, each in form
satisfactory to the Agent and will pay all filing or recording costs with
respect thereto, and all costs of filing or recording this Security
Agreement or any other instrument, agreement or document executed and
delivered pursuant hereto or to the Agreement (including the cost of all
federal, state or local mortgage, documentary, stamp or other taxes), in
each case, in all public offices where filing or recording is deemed by the
Agent to be necessary or desirable. The Debtor hereby authorizes the Agent
to take all action (including, without limitation, the filing of any
Uniform Commercial Code financing statements or amendments thereto without
the signature of the Debtor or by signing of the Debtor's name to any such
financing statements as its attorney-in-fact) which the Agent may deem
necessary or desirable to perfect or otherwise protect the liens and
security interests created hereunder and to obtain the benefits of this
Security Agreement.
5. General Covenants.
-----------------
The Debtor shall:
(a) furnish the Agent from time to time at the Agent's
reasonable request written statements and schedules further identifying and
describing the Collateral in such detail as the Agent may reasonably
require;
(b) advise the Agent promptly, in sufficient detail, of any
substantial change in the Collateral, and of the occurrence of any event
which would have a material adverse effect on the value of the Collateral
or on the Secured Parties' security interest therein;
(c) comply with all acts, rules, regulations and orders of any
legislative, administrative or judicial body or official applicable to the
Collateral or any part thereof or to the operation of the Debtor's business
except where the failure to comply (a) is non-material and (b) has no
effect on the value of the Collateral or on the ability of the Secured
Parties to exercise their rights and remedies hereunder; provided, however,
-------- -------
that the Debtor may contest any acts, rules,
4
regulations, orders and directions of such bodies or officials in any
reasonable manner which will not, in the Agent's reasonable opinion,
adversely affect the Agent's or the Secured Parties' rights or the priority
of their security interests in the Collateral;
(d) perform and observe all covenants, restrictions and
conditions contained in the Agreement providing for payment of taxes,
maintenance of insurance and otherwise relating to the Collateral, as
though such covenants, restrictions and conditions were fully set forth in
this Security Agreement;
(e) promptly notify the Agent of all disputes with account
debtors involving amounts in excess of $100,000;
(f) promptly execute and deliver to the Agent such further
deeds, mortgages, assignments, security agreements or other instruments,
documents, certificates and assurances and take such further action as the
Agent may from time to time in its sole discretion deem necessary to
perfect, protect or enforce the Agent's or the Secured Parties' security
interests in the Collateral or otherwise to effect the intent of this
Security Agreement and the Agreement;
(g) keep or cause to be kept the Collateral in good working
order, repair, running and marketable condition, ordinary wear and tear
excepted, at the Debtor's own cost and expense; and
(h) not assign, sell, mortgage, lease, transfer, pledge, grant a
security interest in or lien upon, encumber or otherwise dispose of or
abandon, any part or all of the Collateral, without the express prior
written consent of the Agent (exercisable in the sole discretion of the
Secured Parties), except (i) for the sale from time to time in the ordinary
course of business of the Debtor of such items of Collateral as may
constitute part of the business inventory of the Debtor; and (ii) as
otherwise expressly provided in the Agreement.
6. Assignment of Insurance.
-----------------------
At or prior to the date hereof, the Debtor shall deliver to
Secured Parties copies of, or certificates of the issuing companies with
respect to, endorsements of any and all policies of insurance owned by the
Debtor covering or in any manner relating to the Collateral, in form and
substance satisfactory to the Secured Parties naming the Secured Parties as
additional insured parties as their interests may appear with respect to
liability coverage and the Agent on behalf of the Secured Parties as loss
payee with respect to property and extended insurance coverage, and
indicating that no such policy will be terminated, or reduced in coverage
or amount, without at least thirty (30) days prior written notice from the
insurer to the Agent. As further security for the due payment and
performance of the Obligations, the Debtor hereby assigns to the Agent for
the benefit of the Secured Parties all sums, including returned or unearned
premiums, which may become payable under or in respect of any policy of
insurance owned by the Debtor covering or in any manner relating to the
Collateral, and the Debtor hereby directs each insurance company issuing
any such policy to make payment of sums directly to the Agent for the
benefit of the Secured Parties. The Debtor hereby appoints the Agent as
the Debtor's attorney-in-fact and authorizes the
5
Agent in the Debtor's or in the Agent's name to endorse any check or draft
representing any such payment and to execute any proof of claim,
subrogation receipt and any other document required by such insurance
company as a condition to or otherwise in connection with such payment,
and, upon the occurrence of any Default or Event of Default, to cancel,
assign or surrender any such policies. All such sums received by the Agent
shall be applied by the Agent to satisfaction of the Obligations or, to the
extent that such sums represent unearned premiums in respect of any policy
of insurance on the Collateral refunded by reason of cancellation, toward
payment for similar insurance protecting the respective interests of the
Debtor and the Secured Parties, or as otherwise required by applicable law.
7. Fixtures.
--------
It is the intent of the Debtor and the Secured Parties that none
of the Collateral is or shall be regarded as fixtures, as that term is used
or defined in Article 9 of the Uniform Commercial Code, and the Debtor
represents and warrants that it has not made and is not bound by any lease
or other agreement which is inconsistent with such intent. Nevertheless,
if the Collateral or any part thereof is or is to become attached or
affixed to any real estate, the Debtor will, upon request, furnish the
Agent with a disclaimer or subordination in form reasonably satisfactory to
the Agent of the holder of any interest in the real estate to which the
Collateral is attached or affixed, together with the names and addresses of
the record owners of, and all other persons having interest in, and a
general description of, such real estate.
8. Collections.
-----------
(a) The Debtor may collect all checks, drafts, cash or other
remittances (i) in payment of any of its accounts, contract rights or
general intangibles constituting part of the Collateral, (ii) in payment of
any Collateral sold, transferred, leased or otherwise disposed of, or (iii)
in payment of or on account of its accounts, contracts, contract rights,
notes, drafts, acceptances, general intangibles, choses in action and all
other forms of obligations relating to any of the Collateral so sold,
transferred, or leased or otherwise disposed of, and all of the foregoing
amounts so collected after the occurrence of an Event of Default shall be
held in trust by the Debtor for, and as the property of, the Secured
Parties and shall not be commingled with other funds, money or property of
the Debtor.
(b) Upon the written request of the Agent, during the occurrence
and continuance of an Event of Default, the Debtor will immediately upon
receipt of all such checks, drafts, cash or other remittances in payment of
any of its accounts, contract rights or general intangibles constituting
part of the Collateral, deliver any such items to the Agent for the benefit
of the Secured Parties accompanied by a remittance report in form supplied
or approved by the Agent, such items to be delivered to the Agent in the
same form received, endorsed or otherwise assigned by the Debtor where
necessary to permit collection of such items and, regardless of the form of
such endorsement, the Debtor hereby waives presentment, demand, notice of
dishonor, protest, notice of and all other notices with respect thereto.
6
(c) Upon the written request of the Agent during the occurrence
and continuance of an Event of Default, the Debtor will immediately upon
receipt of all such checks, drafts, cash or other remittances in payment
for any Collateral sold, transferred, leased or otherwise disposed of, or
in payment or on account of its accounts, contracts, contract rights,
notes, drafts, acceptances, general intangibles, choses in action and all
other forms of obligations relating to any of the Collateral so sold,
transferred, leased or otherwise disposed of, deliver any such items to the
Agent accompanied by a remittance report in form supplied or approved by
the Agent, such items to be delivered to the Agent in the same form
received, endorsed or otherwise assigned by the Debtor where necessary to
permit collection of such items and, regardless of the form of such
endorsement, the Debtor hereby waives presentment, demand, notice of
dishonor, protest, notice of protest and all other notices with respect
hereto.
(d) Upon the written request of the Agent, the Debtor will
promptly notify the Agent in writing of the return or rejection of any
goods represented by any accounts, contract rights or general intangibles
and upon the occurrence and continuance of an Event of Default, the Debtor
shall forthwith account therefor to the Agent for the benefit of the
Secured Parties in cash without demand or notice and until such payment has
been received by the Agent the Debtor will receive and hold all such goods
separate and apart, in trust for and subject to the security interest in
favor of the Agent for the benefit of the Secured Parties, and the Agent is
authorized to sell, for the Debtor's account and at the Debtor's sole risk,
all or any part of such goods.
(e) All of the foregoing remittances shall be applied and
credited by the Agent first to satisfaction of the Obligations or as
otherwise required by applicable law, and to the extent not so credited or
applied, shall be paid over to the Debtor.
9. Rights and Remedies.
-------------------
In the event of the occurrence and continuance of any Event of
Default, the Agent, on behalf of the Secured Parties, shall at any time
thereafter have the right, with or without (to the extent permitted by
applicable law) notice to the Debtor, as to any or all of the Collateral,
by any available judicial procedure or without judicial process, to take
possession of the Collateral and without liability for trespass to enter
any premises where the Collateral may be located for the purpose of taking
possession of or removing the Collateral, and, generally, to exercise any
and all rights afforded to a secured party under the Uniform Commercial
Code or other applicable law. Without limiting the generality of the
foregoing, the Debtor agrees that the Agent, on behalf of the Secured
Parties, shall have the right to sell, lease, or otherwise dispose of all
or any part of the Collateral, whether in its then condition or after
further preparation or processing, either at public or private sale or at
any broker's board, in lots or in bulk, for cash or for credit, with or
without warranties or representations, and upon such terms and conditions,
all as the Agent in its sole discretion may deem advisable, and it or any
of the Secured Parties shall have the right to purchase at any such sale;
and, if any Collateral shall require rebuilding, repairing, maintenance,
preparation, or is in process or other unfinished state, the Agent shall
have the right, at its sole option and discretion, to do such rebuilding,
repairing, preparation, processing or completion of manufacturing, for the
purpose of putting the Collateral in such saleable or disposable form as it
shall deem appropriate. At the Agent's request, the Debtor shall assemble
the Collateral and make
7
it available to the Agent at places which the Agent shall reasonably
select, whether at the Debtor's premises or elsewhere, and make available
to the Agent, without rent, all of the Debtor's premises and facilities for
the purpose of the Agent's taking possession of, removing or putting the
Collateral in saleable or disposable form. The proceeds of any such sale,
lease or other disposition of the Collateral shall be applied first to the
expenses of retaking, holding, storing, processing and preparing for sale,
selling, and the like, and to the reasonable attorneys' fees and legal
expenses incurred by the Agent and/or the Secured Parties, and then to
satisfaction of the Obligations, and to the payment of any other amounts
required by applicable law, after which the Agent shall account to the
Debtor for any surplus proceeds. If, upon the sale, lease or other
disposition of the Collateral, the proceeds thereof are insufficient to pay
all amounts to which the Secured Parties are legally entitled, the Debtor
will be liable for the deficiency, together with interest thereon, at the
rate prescribed in the Agreement, and the reasonable fees of any attorneys
employed by the Agent and/or the Secured Parties to collect such
deficiency. To the extent permitted by applicable law, the Debtor waives
all claims, damages and demands against the Agent and the Secured Parties
arising out of the repossession, removal, retention or sale of the
Collateral except for the gross negligence or willful misconduct of the
Agent or any Secured Party.
10. Costs and Expenses.
------------------
Any and all fees, costs and expenses, of whatever kind or nature,
including the reasonable attorneys' fees and legal expenses incurred by the
Agent and/or the Secured Parties, in connection with the preparation of
this Security Agreement and all other documents relating hereto and the
consummation of this transaction, the filing or recording of financing
statements and other documents (including all taxes in connection
therewith) in public offices, the payment or discharge of any taxes,
insurance premiums, encumbrances or otherwise protecting, maintaining or
preserving the Collateral and the Secured Parties' security interest
therein, whether through judicial proceedings or otherwise, or in defending
or prosecuting any actions or proceedings arising out of or related to the
transaction to which this Security Agreement relates shall be borne and
paid by the Debtor on demand by the Agent and/or the Secured Parties and
until so paid shall be added to the principal amount of the Obligations and
shall bear interest at the rate prescribed in the Agreement. The parties
hereto agree that the attorneys' fees and legal expenses of the Agent and
the Secured Parties incurred prior to the date of this Security Agreement
shall be limited to the fees and expenses of Rivkin, Radler & Kremer,
counsel to the Secured Parties.
11. Power of Attorney.
-----------------
The Debtor authorizes the Agent and does hereby make, constitute
and appoint the Agent, and any officer or agent of the Agent, with full
power of substitution, as the Debtor's true and lawful attorney-in-fact,
with power, in its own name or in the name of the Debtor upon the
occurrence and, during the continuance of an Event of Default: (a) to
endorse any notes, checks, drafts, money orders, or other instruments of
payment (including payments payable under or in respect of any policy of
insurance) in respect of the Collateral that may come into possession of
the Agent; (b) to sign and endorse any invoice, freight or express bill,
bill of lading, storage or warehouse receipts, drafts against debtors,
assignments, verifications and notices in connection with accounts, and
other documents relating to Collateral; (c) to pay or discharge any taxes,
liens,
8
security interest or other encumbrances at any time levied or placed on or
threatened against the Collateral which are not permitted under the
Agreement; (d) to demand, collect, receipt for, compromise, settle and sue
for monies due in respect of the Collateral; (e) to receive, open and
dispose of all mail addressed to the Debtor and to notify the Post Office
authorities to change the address for delivery of mail addressed to the
Debtor to such address as the Agent may designate; and (f) generally to do,
at the Agent's option and at the Debtor's expense, at any time, or from
time to time, all acts and things which the Agent deems necessary to
protect, preserve and realize upon the Collateral and the Secured Parties'
security interest therein in order to effect the intent of this Security
Agreement and the Agreement, all as fully and effectually as the Debtor
might or could do; and the Debtor hereby ratifies all that said attorney
shall lawfully do or cause to be done by virtue hereof. All acts of said
attorney or designee are hereby ratified and approved and said attorney or
designee shall not be liable for any acts of commission or omission, nor
for any error or judgment or mistake of fact or law except for its own
gross negligence or willful misconduct. This power of attorney shall be
irrevocable for the term of this Security Agreement and thereafter as long
as any of the Obligations shall be outstanding.
12. Notices.
-------
Unless the party to be notified otherwise notifies the other
party in writing as provided in this Section, notices shall be given
hereunder by telecopy, by certified or registered mail or by recognized
overnight delivery services to any party at its address on the signature
page of this Security Agreement. Notices shall be effective (a) if given
by registered or certified mail, on the third day after deposit in the
mails with postage prepaid, addressed as aforesaid; (b) if given by
recognized overnight delivery service, on the business day following
deposit with such service, addressed as aforesaid; or (c) if given by
telecopy, when the telecopy is transmitted to the telecopy number as
aforesaid; provided that all notices to the Agent and the Secured Parties
shall be effective on receipt.
13. Other Security.
--------------
To the extent that the Obligations are now or hereafter secured
by property other than the Collateral or by the guarantee, endorsement or
property of any other person, then the Agent shall have the right in its
sole discretion to pursue, relinquish, subordinate, modify or take any
other action with respect thereto, without in any way modifying or
affecting any of the Agent's and/or the Secured Parties' rights and
remedies hereunder.
14. Deposits.
--------
Any and all deposits or other sums at any time credited by or due
from any of the Secured Parties to the Debtor, whether in regular or
special depository accounts or otherwise, shall at all times constitute
additional Collateral for the Obligations, and may, upon the occurrence and
during the continuance of an Event of Default, be set-off by the Secured
Parties, or any of them, against any Obligations at any time, whether or
not other collateral held by the Agent on behalf of the Secured Parties is
considered to be adequate.
9
15. Miscellaneous.
-------------
(a) Beyond the safe custody thereof, the Agent shall as to the
Debtor have no duty as to the collection of any Collateral in its
possession or control or in the possession or control of any agent or
nominee of the Agent, or any income thereon or as to the preservation of
rights against prior parties or any other rights pertaining thereto.
(b) No course of dealing between the Debtor and the Agent or the
Secured Parties, nor any failure to exercise, nor any delay in exercising,
on the part of the Agent or the Secured Parties, any right, power or
privilege hereunder or under the Agreement shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, power or
privilege hereunder or thereunder preclude any other or further exercise
thereof or the exercise of any other right, power or privilege.
(c) All of the Agent's and the Secured Parties' rights and
remedies with respect to the Collateral, whether established hereby or by
the Agreement, or by any other agreements, instruments or documents or by
law, shall be cumulative and may be exercised singly or concurrently.
(d) The provisions of this Security Agreement are severable, and
if any clause or provision shall be held invalid or unenforceable in whole
or in part in any jurisdiction, then such invalidity or unenforceability
shall affect only such clause or provision, or part thereof, in such
jurisdiction and shall not in any manner affect such clause or provision in
any other jurisdiction, or any other clause or provision of this Security
Agreement in any jurisdiction.
(e) This Security Agreement (including this subsection) is
subject to modification only by a writing signed by all of the parties
hereto.
(f) The benefits and burdens of this Security Agreement shall
inure to the benefit of and be binding upon the respective successors and
assigns of the parties hereto; provided, however, that the rights and
obligations of the Debtor under this Security Agreement shall not be
assigned or delegated without the prior written consent of the Agent and
the Secured Parties (exercisable in their sole discretion), and any
purported assignment or delegation without such consent shall be void.
16. Term of Agreement.
-----------------
Notwithstanding anything herein or in the Agreement, the Agent
and the Secured Parties agree that:
(a) upon the payment in full of the Obligations (other than
Obligations, including, without limitation, indemnities, which are intended
to survive the payment of the Loans and/or termination of the Commitments)
and termination of the Commitments, (1) this Security Agreement shall
automatically terminate and be of no force or effect, (2) all liens created
hereunder shall terminate, (3) the Agent shall promptly deliver and/or
transfer to the Debtor any and all
10
Collateral in the Agent's or its representative's possession and (4) the
Agent shall execute and deliver to the Debtor such documents and
instruments as the Debtor shall reasonably request in order to evidence the
foregoing; and
(b) upon the sale, transfer or other disposition of any
Collateral permitted to be sold, transferred or otherwise disposed of under
the Agreement, the lien therein created hereunder shall automatically
terminate and the Agent shall execute and deliver to the Debtor such
documents and instruments as the Debtor shall reasonably request in order
to evidence same.
WITNESS the execution hereof as of the day and year first above
written.
VEECO INSTRUMENTS INC., as Debtor
By:/s/ John F. Rein, Jr.
--------------------------
Name: John F. Rein, Jr.
Title: Vice President
Address for Notices:
Terminal Drive
Plainview, New York 11803
Telephone: (516) 349-8300
Telecopier: (516) 349-9079
Attention: John F. Rein, Jr.
FLEET BANK, N.A.,
as Agent and as a Secured Party
By: /s/ William Ewing
_________________________
Name: William Ewing
Title: Vice President
Address for Notices:
Fleet Bank, N.A.
300 Broad Hollow Road
Melville, New York 11747
Telephone: (516) 755-7759
Telecopier: (516)755-7715
Attention: William Ewing
11
THE CHASE MANHATTAN BANK
By: /s/ Carolyn B. Lattanzi
____________________________
Name: Carolyn B. Lattanzi
Title: Vice President
Address for Notices:
The Chase Manhattan Bank
395 North Service Road
Melville, New York 11747
Telecopier: (516)755-0143
Telephone: (516)755-5163
Attention: Carolyn B. Lattanzi
12
SCHEDULE I
TO
SECURITY AGREEMENT
------------------
Offices Where Records Are Kept:
-------------------------------
Veeco Instruments Inc.
Terminal Drive
Plainview, New York 11803
Other Locations Where Collateral
Is Stored, Used or Located:
--------------------------
Sloan Technology Corp.
602 East Montecito Street
Santa Barbara, CA 93103
Koll Business Center
1582 Parkway Loop
Suite E, Building 0301, Unit E
Tustin, California 92680
470 South Hillview Drive
Milpitas, California
Concorde Professional Building
9944 South Roberts Road
Suite 101
Palos Hills, Illinois 60465
Business and Trade Names
Used by Debtor:
---------------
Veeco Instruments Inc.
Veeco
Sloan Technology
Upa Technology
13
SCHEDULE A
TO
UCC-1 FINANCING STATEMENT
NAMING VEECO INSTRUMENTS INC. AS DEBTOR, AND
FLEET BANK, N.A.,
AS AGENT FOR ITSELF AND
THE CHASE MANHATTAN BANK, AS SECURED PARTIES
--------------------------------------------
All of the Debtor's right, title and interest, whether now
existing or hereafter arising, in and to the following:
(a) All personal property of the Debtor, whether now or
hereafter existing or now owned or hereafter acquired and wherever located,
of every kind and description, tangible or intangible, including, without
limitation, the balance of every deposit account now or hereafter existing
of the Debtor with the Secured Parties or any of them, or with any agent of
the Secured Parties or any of them to the extent such account is maintained
by such agent in its capacity as agent of any kind for the Secured Parties
or any of them, and all goods, equipment, furniture, inventory (including,
without limitation, all raw materials, finished goods and work-in-process),
accounts, contract rights, chattel paper, notes receivable, instruments,
documents (including, without limitation, documents of title, warehouse
receipts and all other shipping documents and instruments of any kind
whatsoever, whether relating to goods in transit or otherwise), general
intangibles, credits, claims, demands and any other obligations of any
kind, whether now or hereafter arising, of the Debtor and, as to all the
foregoing, any and all additions and accessions thereto, all substitutions
and replacements therefor and all products and proceeds thereof (including,
without limitation, proceeds of insurance thereon).
The term "accounts" shall mean, without limiting the generality
of the foregoing, any and all now existing or hereafter arising rights to
payment held by the Debtor, whether in the form of accounts receivable,
notes, drafts, acceptances or other forms of obligations and receivables
now or hereafter received by or belonging to the Debtor for (A) inventory
sold or leased by it, (B) services rendered by it, or (C) advances or loans
made by it to customers, together with all guarantees and security therefor
and all proceeds thereof, whether cash proceeds or otherwise, including,
without limitation, all right, title and interest of the Debtor in the
inventory which gave rise to any such accounts, including, without
limitation, the right to stoppage in transit and all returned, rejected,
rerouted or repossessed inventory.
(b) All choses in action, any rights arising under any judgment,
statute or rule, all corporate and business records, customer lists, credit
files, computer program print-outs, and other computer materials and
records, all inventories, trademarks, trade styles, trade names, designs,
patents, copyrights, licenses, license agreements, and any applications for
patents and/or trademarks.
(c) Any and all additions and accessions to the foregoing
Collateral, all substitutions and replacements therefor and all products
and proceeds thereof (including, without limitation, proceeds of insurance
thereon).
14
(d) All sums, including returned or unearned premiums, which may
become payable under or in respect of any policy of insurance owned by the
Debtor covering or in any manner relating to the Collateral.
(e) Any and all deposits or other sums at any time credited by
or due from any of the Secured Parties to the Debtor whether in regular or
special depository accounts or otherwise. When the term "Secured Parties"
is used above, it means Fleet Bank, N.A. and The Chase Manhattan Bank.
15