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EXHIBIT 10.42
AMENDED AND RESTATED SECURITY AGREEMENT
THIS AMENDED AND RESTATED SECURITY AGREEMENT (this "Security
Agreement") dated effective as of June 30, 1995 is made by AMERICAN ECOLOGY
CORPORATION, a Delaware corporation, having its office located at 5333
Westheimer, Suite 1000, Houston, Texas 77056 (the "Grantor"), in favor of TEXAS
COMMERCE BANK NATIONAL ASSOCIATION, a national banking association (the
"Secured Party").
PRELIMINARY STATEMENT
WHEREAS, the Grantor executed that one certain Security
Agreement dated as of December 1, 1994 (the "Original Security Agreement") in
favor of the Secured Party, as agent and as a bank, as security for the
obligations of the Grantor under that certain Amended and Restated Credit
Agreement dated of December 1, 1994; and
WHEREAS, the Security Party, the Grantor and certain of its
subsidiaries, as Guarantors, have entered into a Second Amended and Restated
Credit Agreement dated effective as of even date herewith (said Second
Amendment and Restated Credit Agreement, as it may hereafter be amended or
otherwise modified from time to time, being the "Credit Agreement") under the
terms of the which the Secured Party has agreed to make various loans to the
Grantor up to a total of $35,000,000.00; and
WHEREAS, it is a condition precedent to the obligation of the
Secured Party to make the loans to the Grantor under the Credit Agreement that
the Grantor shall execute and deliver this Security Agreement to the Secured
Party in amendment and restatement of the Original Security Agreement and
continuation of the liens in respect thereof, and the Grantor desires to
execute this Security Agreement in order to satisfy such condition precedent.
NOW, THEREFORE, in consideration of the premises and in order
to induce the Secured Party to make the loans to the Grantor under the Credit
Agreement, the Grantor hereby agree as follows:
SECTION 1. Defined Terms. "UCC" means the Uniform Commercial
Code as in effect on the date hereof in the State of Texas, provided that if by
mandatory provisions of law, the perfection or the effect of perfection or non-
perfection of the security interests granted pursuant to Section 2 hereof, as
well as all other security interests created or assigned as additional security
for the Obligations pursuant to the provisions of this Security Agreement, in
any Collateral is governed by the UCC as in effect in such other jurisdiction
other than Texas, "UCC" means the UCC as in effect in such other jurisdiction
for purposes of the provisions hereof relating to such perfection or
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effect of perfection or non-perfection. All capitalized terms used herein
which are defined in the Credit Agreement and not otherwise defined herein
shall have the meanings specified therein.
SECTION 2. Grant of Security. The Grantor hereby assigns and
pledges to the Secured Party, and hereby grants to the Secured Party, a
security interest in all of the Grantor's right, title and interest in and to
the following, whether presently held or hereafter acquired (the "Collateral"):
(a) All accounts (as defined in the UCC), receivables,
accounts receivable, lease receivables, contract rights, chattel
paper, drafts, acceptances, instruments, writings evidencing a
monetary obligation or a security interest or a lease of goods,
general intangibles and other obligations of any kind, now or
hereafter existing, whether or not arising out of or in connection
with the sale or lease of goods or the rendering of services, and all
rights now or hereafter existing in and to all security agreements,
leases, and other contracts securing or otherwise relating to any such
accounts, receivables, accounts receivable, lease receivables,
contract rights, chattel paper, drafts, acceptances, instruments,
writings evidencing a monetary obligation or a security interest or a
lease of goods, general intangibles or obligations (any and all of the
foregoing being the "Receivables"); and
(b) All equipment (as defined in the UCC) and all
machinery, chattels, tools, dies, jigs, molds, parts, machine tools,
furniture, furnishings, fixtures rolling stock, cars, trucks,
trailers, tractors, cabs, engines, motors, parts and supplies of every
nature wherever located, including all additions, accessories and
improvements thereto and substitutions therefor (any and all of the
foregoing being the "Equipment"); and
(c) All inventory (as defined in the UCC) in all of its
forms, wherever located, now or hereafter existing and whether
acquired by purchase, merger or otherwise and all raw materials and
work in process therefor, all finished goods thereof and all materials
used or consumed in the manufacture, packing, shipping, advertising,
selling, leasing or production thereof, goods in which the Grantor has
an interest in mass or joint or other interest or right of any kind
and goods which are returned to or repossessed by the Grantor, and all
accessions thereto and products thereof and documents therefor (any
and all of the foregoing being the "Inventory"); and
(d) All licenses, permits, leases, operating agreements
and rights of any kind to store, process, transport, dispose of, treat
or otherwise deal with chemical radioactive or other types of
hazardous wastes or other materials, including, without limitation,
those items listed on Schedule 2(d) hereto.
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(e) Notwithstanding that the Collateral secures all of
the Secured Obligations, specific Letter of Credit Collateral is
subject to the terms of Sections 3.06 and 4.01(c) of the Credit
Agreement, and is specifically pledged to individual Letters of Credit
as described in Section 4.01(c) of the Credit Agreement; provided, if
an Event of Default under Section 10.01(f) of the Credit Agreement
occurs, then all Letter of Credit Collateral that is not otherwise
included in the definition of Collateral hereunder and is not used to
repay the Secured Party for any draws under any Letter of Credit shall
be expressly included as Collateral hereunder; and
(f) All products and proceeds of any and all of the
foregoing Collateral and, to the extent not otherwise included, all
payments under insurance or any indemnity, warranty or guaranty,
payable by reason of loss or damage to or otherwise with respect to
any of the foregoing Collateral.
The inclusion of proceeds in this Security Agreement does not
authorize the Grantor to sell, dispose of or otherwise use the Collateral in
any manner not specifically authorized hereby.
SECTION 3. Security for Obligations. This Security Agreement
secures the prompt and complete (a) payment and performance of all obligations
of the Grantor to the Secured Party now or hereafter existing under the
Revolving Credit Note, the Fee Capitalization Note and the Term Note and any
duties or obligations of the Grantor under the Credit Agreement, including
letters of credit, and the other Loan Documents, and (b) performance and
observance by the Grantor of all covenants and conditions contained in the
Credit Agreement, this Security Agreement and any other Loan Document to which
it is a party, and in any case whether for principal, interest, fees, expenses
or otherwise, including without limitation, Article IX of the Credit Agreement
(all such obligations, covenants and conditions described in the foregoing
clauses (a) and (b) being hereinafter collectively referred to as the "Secured
Obligations").
SECTION 4. Grantor Remain Liable. Anything herein to the
contrary notwithstanding, (a) the Grantor shall remain liable under the
contracts and agreements included in the Collateral to the extent set forth
therein to perform all of its duties and obligations thereunder to the same
extent as if this Security Agreement had not been executed, (b) the exercise by
the Secured Party of any of the rights hereunder shall not release the Grantor
from any of its duties or obligations under the contracts and agreements
included in the Collateral, and (c) the Secured Party shall not have any
obligation or liability under the contracts and agreements included in the
Collateral by reason of this Security Agreement, nor shall the Secured Party be
obligated to perform any of the obligations or duties of the Grantor thereunder
or to take any action to collect or enforce any claim for payment assigned
hereunder.
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SECTION 5. Representations and Warranties. The Grantor
represents and warrants as follows:
(a) All of the Collateral is located at the places
specified on Schedule 15(b) hereto. The chief place of business and
chief executive office of the Grantor and the office where the Grantor
keeps its records concerning the Collateral is located at the address
specified in the introductory paragraph to this Security Agreement.
(b) The Grantor owns the Collateral free and clear of any
lien or security interest except for the lien and security interest
created by this Security Agreement and Liens existing in favor of the
Secured Party. No effective financing statement or other instrument
similar in effect covering all or any part of the Collateral is on
file in any recording office, except such as may have been filed in
favor of the Secured Party relating to this Security Agreement. The
Grantor has no trade names except as shown on Schedule 15(b) hereto.
(c) This Security Agreement has been duly executed and
delivered by the Grantor and creates a valid and perfected first
priority lien and security interest in the Collateral, securing the
payment of the Secured Obligations, and all filings and other actions
necessary or desirable to perfect and protect such lien and security
interest have been duly taken.
(d) No consent of, or notice to, any other persons and no
authorization, approval or other action by, and no notice to or filing
with, any governmental authority or regulatory body is required either
(i) for the grant by the Grantor of the lien and security interest
granted hereby or for the execution, delivery or performance of this
Security Agreement by the Grantor or (ii) for the perfection of or the
exercise by the Secured Party of its rights and remedies hereunder,
other than the filing of financing statements with the Secretary of
State of the States of Texas and Delaware.
(e) All information with respect to the Collateral and
the obligors under the Receivables set forth in any Schedule
(including Schedule I hereto), certificate or other writing at any
time heretofore or hereafter furnished by the Grantor to the Secured
Party is and will be true, correct and complete in all material
respects as of the date specified therein.
SECTION 6. Further Assurances. (a) The Grantor agrees that
from time to time, at the expense of the Grantor, the Grantor will promptly
execute and deliver all further instruments and documents, and take all further
action, that may be necessary or desirable, or that the Secured Party may
request, in order to perfect and protect any security interest granted or
purported to be granted hereby or to enable the Secured Party to exercise and
enforce its rights and remedies hereunder with respect to any Collateral.
Without limiting the generality of the foregoing, the Grantor will: (i) mark
conspicuously, at the request of the Secured Party, each of their records
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pertaining to the Collateral with a legend indicating that such document,
chattel paper, or Collateral is subject to the security interest granted
hereby; (ii) if any Receivable shall be evidenced by a promissory note or other
instrument or chattel paper, upon the request of the Secured Party, the Grantor
shall, deliver and pledge to the Secured Party for the benefit of the Secured
Party such note, instrument or chattel paper duly endorsed and accompanied by
duly executed instruments of transfer or assignment, all in form and substance
satisfactory to the Secured Party and (iii) 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 the Secured Party may request,
in order to perfect and preserve the security interests granted or purported to
be granted hereby.
(b) The Grantor hereby authorizes the Secured Party to
file one or of more financing or continuation statements, and amendments
thereto, relative to all or any part of the Collateral without the signatures
of the Grantor where permitted by law. A carbon, photographic or other
reproduction of this Security Agreement of any financing statement covering the
Collateral or any part thereof shall be sufficient as a financing statement
where permitted by law.
(c) The Grantor will furnish to the 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 the
Secured Party may reasonably request, all in reasonable detail.
(d) The Grantor will promptly notify the Secured Party of
any change of its name, corporate structure or federal tax identification
number.
(e) The Grantor shall keep its chief place of business
and chief executive office and the office where it keeps its books and records
concerning the Collateral, and all originals of all chattel paper, instruments
and documents which evidence Receivables at the location therefor specified in
Section 5(a) or, upon 30 days prior written notice to the Secured Party, at
such other locations in a jurisdiction where all action required by Section 6
shall have been taken with respect to the Receivables. The Grantor will hold
and preserve such records and chattel paper and will upon reasonable notice
permit representatives of the Secured Party at any time during normal business
hours to inspect and make abstracts from such records and chattel paper.
(f) Except as otherwise provided in this subsection (f),
the Grantor shall continue to collect, at its own expense, all amounts due or
to become due the Grantor under the Receivables. In connection with such
collections, the Grantor may take (and, upon the occurrence and continuance of
an Event of Default at the Secured Party's direction, shall take) such action
as the Grantor or the Secured Party may deem necessary or advisable to enforce
collection of the Receivables; provided, that the Secured Party shall have the
right at any time, upon the occurrence and during the continuance of an Event
of Default and upon written notice to the Grantor of its intention to do so, to
notify the account debtors or obligors under any Receivables of the assignment
of such
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Receivables to the Secured Party and to direct such account debtors or obligors
to make payment of all amounts due or to become due to the Grantor thereunder
directly to the Secured Party and, upon such notification and at the expense of
the Grantor, to enforce collection of any such Receivables, and to adjust,
settle or compromise the amount of payment thereof, in the same manner and to
the same extent as the Grantor might have done. After receipt by the Grantor
of the notice from the Secured Party referred to in the proviso to the
preceding sentence, (i) all amounts and proceeds (including instruments)
received by the Grantor in respect of the Receivables shall be received in
trust for the benefit of the Secured Party hereunder, shall be segregated from
other funds of the Grantor and shall be forthwith paid over to the Secured
Party in the same form as so received (with any necessary endorsement) to be
held as cash collateral and either (A) released to the Grantor so long as no
Event of Default shall have occurred and be continuing or (B) if any Event of
Default shall have occurred and be continuing, applied as provided in Section
9, and (ii) the Grantor shall not adjust, settle or compromise the amount or
payment of any Receivable, or release wholly or partly any account debtor or
obligor thereof, or allow any credit or discount thereon, except with the prior
written consent of the Secured Party.
(g) The Grantor shall keep the Inventory (other than
Inventory sold in the ordinary course of business or Inventory in transit to a
buyer) at the places therefor specified in Section 5(a) or, upon at least 30
days' prior written notice to the Secured Party, at such other places in
jurisdictions where all action required by Section 6 shall have been taken with
respect to the Inventory.
(h) Not permit anything to be done that may impair the
value of any of the Collateral or the lien and security interest to be afforded
by this Security Agreement.
SECTION 7. Insurance. The Grantor shall, at their own
expense, maintain insurance as provided in Section 7.03 of the Credit
Agreement.
SECTION 8. Transfers and Other Liens. The Grantor shall not:
(a) sell, assign (by agreement, operation of law or otherwise) or otherwise
dispose of any of the Collateral (other than in the ordinary course of
business) or (b) create or suffer to exist any lien or security interest upon
or with respect to any of the Collateral, except for the lien or security
interest created by this Security Agreement and liens and security interests in
favor of the Secured Party as previously disclosed to the Secured Party.
SECTION 9. Remedies and Application of Proceeds. If any
Event of Default shall have occurred and be continuing, the Secured Party may
exercise in respect of the Collateral, in addition to 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 UCC (whether or not the UCC applies to
the affected Collateral) and the Secured Party may also (a) require the Grantor
to, and the Grantor hereby
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agrees that it will at its expense and upon request of the Secured Party
forthwith, assemble all or part of the Collateral as directed by the Secured
Party and make it available to the Secured Party at a place to be designated by
the Secured Party which is reasonably convenient to both parties and (b),
without notice except as specified below, sell the Collateral or any part
thereof in one or more parcels at public or private sale, for cash, on credit
or for future delivery, and upon such other terms as the Secured Party may
deem commercially reasonable. The Grantor will execute and deliver such
documents and take such other action as the Secured Party deems necessary or
advisable in order that any sale may be made. Upon any such sale the Secured
Party shall have the right to deliver and transfer to the purchaser thereof the
Collateral sold. The Grantor agrees that, to the extent notice of sale shall
be required by law, at least ten (10) days' prior written notice to the Grantor
of the time and place of any public sale or the time after which any private
sale is to be made or other intended disposition of any of the Collateral shall
constitute reasonable notification thereof, except any Collateral which is
perishable or threatens to decline speedily in value or is of a type
customarily sold on a recognized market. The Grantor agrees that such notice
constitutes "reasonable notification" within the meaning of Section 9.504(c) of
the UCC. The Secured Party shall not be obligated to make any sale of
Collateral regardless of notice of sale having been given. The Secured Party
may adjourn any public or private sale from time to time by announcement at the
time and place fixed therefor, and such sale may, without further notice, be
made at the time and place to which it was so adjourned.
SECTION 10. Secured Party Appointed Attorney-in-Fact.
Effective upon the occurrence of and continuance of an Event of Default, the
Grantor hereby irrevocably appoints the Secured Party the Grantor's
attorney-in-fact, with full authority in the place and stead of the Grantor
and in the name of the Grantor, the Secured Party or otherwise, from time to
time after the occurrence and during the continuance of an Event of Default in
the Secured Party's sole discretion, to take any action and to execute any
instrument which the Secured Party may deem necessary or advisable to
accomplish the purposes of this Security Agreement, including:
(a) to ask, demand, collect, sue for, recover,
compromise, receive and give acquittance and receipts for moneys due
and to become due under or in respect of any of the Collateral,
(b) to settle, compromise, prosecute or defend any action
or proceeding with respect thereto,
(c) to extend the time of payment thereof and to make
any allowances or adjustment with reference thereto, and
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(d) to sell, transfer, assign, or otherwise deal in or
with the Collateral or the proceeds or avails thereof, as fully and
effectually as if the Secured Party were the absolute owner thereof.
SECTION 11. Secured Party May Perform. If the Grantor fails
to perform any agreement contained herein, the Secured Party may itself
perform, or cause performance of, such agreement, and the expenses of the
Secured Party incurred in connection therewith shall be payable by the Grantor
under Section 13.
SECTION 12. Limitations of the Secured Party's Duties. The
powers conferred on the Secured Party hereunder are solely to protect its
interests in the Collateral and shall not impose any duty upon it to exercise
any such powers. Except for reasonable care in the custody of any Collateral
in its possession and the accounting for moneys actually received by it
hereunder, the Secured Party shall have no duty as to any Collateral or as to
the taking of any necessary steps to preserve rights against prior parties or
any other rights pertaining to any Collateral. The Secured Party shall be
deemed to have exercised reasonable care in the custody and preservation of any
Collateral in its possession if such Collateral is accorded treatment
substantially equal to that which the Secured Party accords it own property, it
being understood that the Secured Party shall not have any responsibility for
taking any necessary steps to preserve rights against any parties with respect
to any Collateral.
SECTION 13. Indemnity and Expenses. (a) The Grantor shall
indemnify the Secured Party and any Affiliate thereof and their respective
directors, officers, employees and Secured Party from, and hold each of them
harmless against, any and all losses, liabilities, claims or damages (including
reasonable legal fees and expenses) to which any of them may become subject,
insofar as such losses, liabilities, claims or damages arise out of or result
from (i) this Security Agreement, the Credit Agreement or any of the loan
documents executed in connection herewith or (ii) any investigation, litigation
or other proceeding (including any threatened investigation or proceeding)
relating to the foregoing, and the Grantor shall reimburse the Secured Party
and each Affiliate thereof and their respective directors, officers, employees
and Secured Party, upon demand for any expenses (including legal fees)
reasonably incurred in connection with any such investigation or proceeding,
but excluding any such losses, liabilities, claims, damages or expenses
incurred by reason of the gross negligence or willful misconduct of the person
to be indemnified. IT IS THE EXPRESS INTENTION OF THE GRANTOR THAT EACH PERSON
TO BE INDEMNIFIED HEREUNDER SHALL BE INDEMNIFIED AND HELD HARMLESS AGAINST ANY
AND ALL LOSSES, LIABILITIES, CLAIMS OR DAMAGES AS LIMITED IN THE PRECEDING
SENTENCE ARISING OUT OF OR RESULTING FROM THE ORDINARY, SOLE OR CONTRIBUTORY
NEGLIGENCE OF SUCH PERSON. Without prejudice to the survival of any other
obligations of the Grantor hereunder, the obligations of the Grantor under this
Section shall survive the termination of this Security Agreement.
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(b) The Grantor agrees to pay within ten (10) Business
Days (as such term is defined in the Credit Agreement) after demand, to the
Secured Party the amount of any and all reasonable expenses, including the fees
and disbursements of its counsel and of any experts and agents, that the
Secured Party may incur in connection with (i) the administration of this
Security Agreement, (ii) the evaluation, appraisal, custody, preservation, use
or operation of, or the sale of, collection from, or other realization upon,
any of the Collateral, (iii) the exercise or enforcement of any of the rights
of the Secured Party hereunder or (iv) the failure by the Grantor to perform or
observe any of the provisions hereof. The Grantor agrees to pay interest on
any expenses or other sums payable to the Secured Party hereunder that are not
paid when due at a rate per annum equal to the Default Rate (as such term is
defined in the Credit Agreement).
SECTION 14. Addresses for Notices. All notices and other
communications provided for hereunder shall be in writing and, if to the
Grantor, mailed or telecopied or delivered to them, addressed to them at the
addresses provided for the Grantor in the introductory paragraph to this
Security Agreement, Attention: Mr. Edmund J. Gorman, Telecopy No.
(713) 624-1909, if to the Secured Party to it at 712 Main Street, Houston, Texas
77002, Attention: Mr. Bruce A. Shilcutt, Telecopy No. (713) 216-2902, or as to
any party at such other address as shall be designated by such party in a
written notice to each other party complying as to delivery with the terms of
this Section. All such notices and other communications shall, when mailed or
telecopied, or delivered respectively, be effective when mailed by certified
mail return receipt requested to any party as its address specified herein, or
telecopied to any party to the telecopy number set forth herein, as applicable,
or delivered personally to any party at its address specified above.
SECTION 15. Termination; Reinstatement. (a) The Grantor
agrees that this Security Agreement and the liens and security interests
granted hereunder shall terminate only when all Obligations have been fully
paid and performed, at which time the Secured Party upon the Grantor's request
shall reassign and redeliver, including the termination of any financing
statements (or cause to be reassigned and redelivered) to the Grantor, or to
such person as the Grantor shall designate in writing, against receipt, such of
the Collateral (if any) as shall not have been sold or otherwise applied by the
Secured Party pursuant to the terms hereof and shall still be held by it
hereunder. Any such reassignment shall be without recourse upon, or
representation or warranty by, the Secured Party (other than that the Secured
Party has not sold, encumbered or otherwise transferred any interest in the
Collateral except as provided in this Security Agreement) and shall be at the
sole cost and expense of the Grantor.
(b) This Security Agreement shall continue to be
effective or be reinstated, as the case may be, if at any time any amount
received by the Secured Party in respect of the Secured Obligations is
rescinded or must otherwise be restored or returned by the Secured Party upon
the filing of any bankruptcy proceeding by or of the Grantor or upon the
appointment of any intervenor
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or conservator of, or trustee or similar official for, the Grantor or any
substantial part of their assets, or otherwise, all as though such payments had
not been made.
SECTION 16. Miscellaneous. (a) No amendment or waiver of
any provision of this Security Agreement, nor consent to any departure by the
Grantor herefrom, shall in any event be effective unless the same shall be in
writing and signed by the Secured Party and the Grantor, and then such waiver
or consent shall be effective only in the specific instance and for the
specific purpose for which given.
(b) All rights and marshalling of assets of the Grantor,
including any such right with respect to the Collateral, are hereby waived by
the Grantor.
(c) All rights, remedies and powers provided in this
Security Agreement may be exercised only to the extent that the exercise
thereof does not violate any applicable provision of law, and all the
provisions of this Security Agreement are intended to be subject to all
applicable mandatory provisions of law which may be controlling and to be
limited to the extent necessary so that they will not render Security Agreement
invalid, unenforceable, in whole or in part, or not entitled to be recorded,
registered or filed under the provision of any applicable law.
(d) Should any clause, sentence, paragraph, subsection or
Section of this Security Agreement be judicially declared to be invalid,
unenforceable or void, such decision will not have the effect of invalidating
or voiding the remainder of this Security Agreement, and the parties hereto
agree that the part or parts of this Security Agreement so held to be invalid,
unenforceable or void will be deemed to have been stricken herefrom by the
parties hereto, and the remainder will have the same force and effectiveness as
if such stricken part or parts had never been included herein.
(e) No failure on the part of the Secured Party to
exercise, and no delay in exercising, any right hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise of any right hereunder
preclude any other or further exercise thereof or the exercise of any other
right. The remedies herein provided are cumulative and not exclusive of any
remedies provided by law.
(f) This Security Agreement may be executed in any number
of counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute but one and the same
agreement.
(g) This Security Agreement shall create a continuing
security interest in the Collateral and shall (a) remain in full force and
effect until payment in full of the Secured Obligations, (b) be binding upon
the Grantor, its successors and assigns and (c) inure to the benefit of the
Secured Party and its successors, transferees and assigns. Upon the payment in
full of the
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Secured Obligations, the lien and security interest granted hereby shall
terminate and all rights to the Collateral shall revert to the Grantor. Upon
any such termination, the Secured Party will, at the Grantor's expense,
promptly execute and deliver to the Grantor such documents as the Grantor shall
reasonably request to evidence such termination.
(h) All representations and warranties contained in this
Security Agreement or made in writing by or on behalf of the Grantor in
connection herewith shall survive the execution and delivery of this Security
Agreement and repayment of the Secured Obligations. Any investigation by the
Secured Party shall not diminish in any respect whatsoever its rights to rely
on such representations and warranties.
(i) The Grantor hereby expressly waive, to the extent
permitted by applicable law, (1) notice of the acceptance by the Secured Party
of this Security Agreement, (2) notice of the existence or creation or
non-payment of all or any of the Secured Obligations, (3) presentment, demand,
notice of dishonor, protest, intent to accelerate, acceleration and all other
notices whatsoever, and (4) all diligence in collection or protection of or
realization upon the Secured Obligations or any thereof, any obligation
hereunder, or any security for or guaranty of any of the foregoing.
(j) In this Security Agreement, unless a clear contrary
intention appears:
(i) the words "herein", "hereof" and "hereunder" and other
words of similar import refer to this Security agreement as a whole
and not to any particular Article, Section or other subdivision;
(ii) reference to any person includes such person's
successors and assigns and reference to a person in a particular
capacity excludes such person in any other capacity or individually;
(iii) reference to any agreement, document or instrument
means such agreement, document or instrument as amended, supplemented
or modified and in effect from time to time in accordance with the
terms thereof;
(iv) unless the context indicates otherwise, reference to any
Article, Section, Schedule or Exhibit means such Article or Section
hereof or such Schedule or Exhibit hereto;
(v) the words "including" (and "include") means
including, without limiting the generality of any description
preceding such term;
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(vi) with respect to the determination of any period of
time, the word "from" means "from and including" and the word "to"
means "to but excluding;" and
(vii) reference to any law means such as amended, modified,
codified or reenacted, in whole or in part, and in effect from time to
time.
(k) The Article and Section headings herein are for
convenience only and shall not affect the construction hereof.
(l) No provision of this Security Agreement shall be
interpreted or construed against any Person solely because that person or its
legal representative drafted such provision.
SECTION 17. Ratification of Security Agreement. The Original
Security Agreement, as amended and restated by this Security Agreement, and the
liens created thereby, are hereby in all respects affirmed, ratified, confirmed
and continued.
SECTION 18. Governing Law, Terms. THIS SECURITY AGREEMENT
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
TEXAS, EXCEPT AS REQUIRED BY MANDATORY PROVISIONS OF LAW AND EXCEPT TO THE
EXTENT THAT THE VALIDITY OR PERFECTION OF THE SECURITY INTEREST HEREUNDER, OR
REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR COLLATERAL ARE GOVERNED BY THE
LAWS OF A JURISDICTION OTHER THAN THE STATE OF TEXAS.
SECTION 19. Waiver of Jury Trial. THE GRANTOR HEREBY WAIVES,
TO THE EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT TO A TRIAL BY JURY IN ANY
ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER THIS SECURITY
AGREEMENT OR UNDER ANY AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED
OR WHICH MAY IN THE FUTURE BE DELIVERED IN CONNECTION HEREWITH OR ARISING FROM
OR RELATING TO ANY BANKING RELATIONSHIP EXISTING IN CONNECTION WITH THIS
SECURITY AGREEMENT AND AGREES, TO THE EXTENT PERMITTED BY APPLICABLE LAW, THAT
ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A
JURY.
SECTION 20. Submission to Jurisdiction. (a) ANY LEGAL
ACTION OR PROCEEDING WITH RESPECT TO THIS SECURITY AGREEMENT AND THE OTHER LOAN
DOCUMENTS MAY BE BROUGHT IN THE COURTS OF THE STATE OF TEXAS OR OF THE UNITED
STATES FOR THE SOUTHERN DISTRICT OF TEXAS AND, BY EXECUTION AND DELIVERY OF
THIS SECURITY AGREEMENT, THE GRANTOR
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HEREBY IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY,
UNCONDITIONALLY, THE NON-EXCLUSIVE JURISDICTION OF THE AFORESAID COURTS WITH
RESPECT TO ANY SUCH ACTION OR PROCEEDING. THE GRANTOR FURTHER IRREVOCABLY
CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THE AFOREMENTIONED COURTS IN
ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR
CERTIFIED MAIL, POSTAGE PREPAID, TO IT AT ITS ADDRESS SET FORTH IN SECTION 14,
SUCH SERVICE TO BECOME EFFECTIVE THIRTY DAYS AFTER SUCH MAILING. NOTHING
HEREIN SHALL AFFECT THE RIGHT OF THE SECURED PARTY TO SERVE PROCESS IN ANY
OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE
PROCEED AGAINST ANY LOAN PARTY IN ANY OTHER JURISDICTION.
(b) THE GRANTOR HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH IT MAY NOW
OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF THE AFORESAID ACTIONS OR
PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT BROUGHT IN THE
COURTS REFERRED TO IN CLAUSE (a) ABOVE AND HEREBY FURTHER IRREVOCABLY WAIVES
AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH ACTION OR
PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
SECTION 21. Final Agreement of the Parties. THIS SECURITY
AGREEMENT (INCLUDING THE SCHEDULES HERETO), THE NOTES, THE CREDIT AGREEMENT AND
THE OTHER LOAN DOCUMENTS CONSTITUTE A "LOAN AGREEMENT" AS DEFINED IN SECTION
26.02 (A) OF THE TEXAS BUSINESS AND COMMERCE CODE, AND REPRESENT THE FINAL
AGREEMENT BETWEEN THE PARTIES RELATING TO THE SUBJECT MATTER HEREOF AND THEREOF
AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT
ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN
THE PARTIES.
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IN WITNESS WHEREOF, the Grantor has caused this Security
Agreement to be duly executed and delivered by their respective officers
thereunto duly authorized as of the date first above written.
AMERICAN ECOLOGY CORPORATION
By: /s/ EDMUND J. GORMAN
-------------------------------------
Edmund J. Gorman
President and Chief Operating Officer
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Schedule 15(b)
Locations of Inventory and Equipment
Houston, Texas
Trade Names
None
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