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Exhibit 10(k)
SECURITY AGREEMENT
THIS SECURITY AGREEMENT dated as of May 31, 1995 (this
"Agreement") is made by OHM CORPORATION, an Ohio corporation ("OHM"), OHM
Remediation Services Corp., an Ohio corporation ("Remediation"), a subsidiary
of OHM, and those of OHM's other subsidiaries that are parties hereto (together
with OHM and Remediation, each a "Grantor" and collectively the "Grantors") in
favor of WMX TECHNOLOGIES, INC., a Delaware corporation (the "Guarantor").
PRELIMINARY STATEMENTS:
(1) OHM, Remediation (OHM and Remediation are sometimes
hereinafter referred to collectively as the "Borrowers"), the Banks, Citicorp
USA, Inc., as Administrative Agent (the "Agent") for the Banks which are
parties to the Credit Agreement (as hereinafter defined, the "Banks") and Bank
of America Illinois, in its capacity as Issuing and Paying Agent and Co- Agent
for the Banks (the "Paying Agent"; together with the Agent and the Banks, the
"Lenders" and individually a "Lender") have entered into that certain Revolving
Credit Agreement dated as of May 31, 1995 as the same may be amended,
supplemented or otherwise modified from time to time (the "Credit Agreement").
(2) The Lenders have required as a condition to the entry
by the Borrowers and the Lenders in and to the Credit Agreement that the
Guarantor execute and deliver that certain Guaranty dated as of May 31, 1995
(as amended, supplemented or otherwise modified from time to time, the
"Guaranty") by the Guarantor in favor of the Lenders pursuant to which the
Guarantor has guaranteed the prompt and complete repayment of the Obligations
(as defined, the "Guaranty") subject to the limitations set forth in the
Guaranty.
(3) The Guarantor has required as a condition to the
entry by the Guarantor in and to the Guaranty that the Borrowers execute and
deliver that certain Reimbursement Agreement dated as of May 31, 1995 (as
amended, supplemented or otherwise modified from time to time, the
"Reimbursement Agreement") among the Guarantor and the Borrowers pursuant to
which the Borrowers covenant and agree to promptly and completely reimburse the
Guarantor for all payments made by the Guarantor under and pursuant to the
Guaranty.
(4) The Guarantor has required and the Borrowers have
agreed that the obligations of the Borrowers under and pursuant to the
Reimbursement Agreement shall be secured under and pursuant to the Security
Documents.
(5) The Guarantor and the Lenders each desire to execute
and deliver that certain Intercreditor Agreement dated as of May 31, 1995 (the
"Intercreditor Agreement") by and among the Agent, the Paying Agent and the
Guarantor in order to set forth certain agreements, rights and interests with
respect to and in connection with their respective interests with respect to
the Grantors as well as their respective security interests in and liens on
certain collateral specified therein.
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NOW, THEREFORE, in consideration of the foregoing premises and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, and to induce Guarantor to enter into the Guaranty,
the Grantors each hereby agrees as follows:
SECTION 1. Defined Terms. (a) Unless otherwise defined
herein, capitalized terms used herein shall have the meanings assigned to them
in the Reimbursement Agreement.
(b) In addition to the terms defined above, in this
Agreement the following terms shall have the meanings set forth below:
"Accounts" means, with respect to each Grantor, all of such
Grantor's now owned or hereafter acquired or arising accounts,
contract rights, and any other rights to payment for the sale or lease
of goods or rendition of services, whether or not they have been
earned by performance.
"Code" means the Uniform Commercial Code (or any successor
statute), as in effect in the State of Illinois or other applicable
jurisdiction from time to time.
"Collateral" shall have the meaning assigned in Section 2 of
this Agreement.
"Equipment" means, with respect to each Grantor, all of such
Grantor's now owned and hereafter acquired machinery, equipment,
furniture, furnishings, fixtures, trade fixtures and other tangible
personal property (except Inventory), including, without limitation,
computers, computer software, peripheral computer equipment, motor
vehicles, fork lifts, construction equipment, tools, and office
equipment, as well as all of such types of property leased by such
Grantor and all of such Grantor's rights and interests with respect
thereto under such leases (including, without limitation, options to
purchase); together with all present and future additions and
accessions thereto, replacements therefor, component and auxiliary
parts and supplies used or to be used in connection therewith, and all
substitutes for any of the foregoing, and all manuals, drawings,
instructions, warranties and rights with respect thereto; wherever any
of the foregoing is located.
"General Intangibles" means, with respect to each Grantor, all
of such Grantor's now owned or hereafter acquired general intangibles,
choses in action and causes of action and all other intangible
personal property of such Grantor of every kind and nature (other than
Accounts), including, without limitation, all Proprietary Rights,
corporate or other business records, inventions, designs, blue-prints,
plans, specifications, trade secrets, goodwill, computer software,
customer lists, registrations, licenses, franchises, tax refund
claims, reversions of funds or any rights thereto and any other
amounts payable to such Grantor from any Plan or other employee
benefit plan, leasehold interests in real and personal property,
rights and claims against carriers and shippers, rights to
indemnification, business interruption insurance and proceeds thereof,
property, casualty or any similar type of insurance and any proceeds
thereof, proceeds of insurance covering the lives of key employees on
which such Grantor is beneficiary, and any letter of credit,
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guarantee, claim, security interest or other security held by or
granted to such Grantor to secure payment of any of the Accounts.
"Guarantor Documents" shall mean the Reimbursement Agreement,
the Security Documents and any other document, agreement or instrument
executed and/or delivered in connection therewith.
"Inventory" means, with respect to each Grantor, all of such
Grantor's now owned and hereafter acquired inventory, goods,
merchandise, work in process, spare parts and other personal property,
wherever located, to be furnished under any contract of service or
held for sale or lease, all returned goods, and materials and supplies
of any kind, nature or description which are or might be consumed in
such Grantor's businesses (except Equipment), or used in connection
with the servicing or provision of parts or supplies for or with
respect to the Equipment, and all documents of title or other
documents representing them.
"Permitted Liens" shall have the meaning assigned in Section
5(b) of this Agreement.
"Proprietary Rights" means, with respect to each Grantor, all
of such Grantor's now owned and hereafter arising or acquired:
licenses, franchises, permits, patents, patent rights, patent
applications, copyrights, works which are the subject matter of
copyrights, trademarks, service marks, trade names, trade styles,
patent, trademark and service mark applications, and all licenses and
rights related to any of the foregoing, and all other rights under any
of the foregoing, all extensions, renewals, reissues, divisions,
continuations, and continuations-in-part of any of the foregoing, and
all rights to sue for past, present and future infringement of any of
the foregoing.
(c) Unless otherwise defined herein, terms used in
Article 9 of the Code are used herein as therein defined.
SECTION 2. Grant of Security. Each Grantor hereby grants,
pledges and assigns to the Guarantor, for the benefit of the Guarantor, a
continuing security interest in, liens on, assignment of and right of set-off
against, all of such Grantor's right, title and interest in and to the
following property, whether now owned or hereafter acquired or arising and
wheresoever located (the "Collateral"):
(i) all Accounts, contract rights, letters of credit,
chattel paper, instruments, notes, documents, and documents of title;
(ii) General Intangibles;
(iii) Inventory;
(iv) Equipment;
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(v) all monies, securities and other property of any kind
of such Grantor in the possession or under the control of either of
the Agent, any Bank, the Paying Agent, a bailee of any of the
foregoing, or any of the foregoing's Affiliates;
(vi) all of such Grantor's deposit accounts, credits, and
balances with and other claims against the Agent, any of the Banks,
the Paying Agent or any Affiliates of the foregoing or any other
financial institution with which such Grantor maintains deposits;
(vii) all books, records and other property relating to or
referring to any of the foregoing, including, without limitation, all
books, records, ledger cards, data processing records, computer
software and other property and general intangibles at any time
evidencing or relating to any of the foregoing; and
(viii) all accessions to, substitutions for and
replacements, products and proceeds of any of the foregoing,
including, but not limited to, proceeds of any insurance policies,
claims against third parties, and condemnation or requisition payments
with respect to all or any of the foregoing.
SECTION 3. Security for Secured Obligations. This Agreement
secures the payment of (i) all obligations of the Borrowers now or hereafter
existing under the Reimbursement Agreement, and all of the other Guarantor
Documents, whether for principal, interest, fees, expenses or otherwise and (ii)
all obligations of the Grantors now or hereafter existing under this Agreement
(all such obligations of the Borrowers and other obligations of the Grantors
being collectively referred to herein as, the "Secured Obligations"). Without
limiting the generality of the foregoing, this Agreement secures the payment of
all amounts which constitute part of the Secured Obligations and would be owed
by any of the Grantors to the Guarantor under the Reimbursement Agreement and
the other Guarantor Documents but for the fact that they are unenforceable or
not allowable due to the existence of a bankruptcy, reorganization or similar
proceeding involving any Grantor.
SECTION 4. Grantors Remain Liable. Anything herein to the
contrary notwithstanding, (a) the Grantors shall remain liable under the
contracts and agreements included in the Collateral to the extent set forth
therein to perform all of their duties and obligations thereunder to the same
extent as if this Agreement had not been executed, (b) the exercise by the
Guarantor of any of the rights hereunder shall not release the Grantors from any
of their duties or obligations under the contracts and agreements included in
the Collateral and (c) the Guarantor shall not have any obligation or liability
under the contracts and agreements included in the Collateral by reason of this
Agreement, nor shall the Guarantor be obligated to perform any of the
obligations or duties of the Grantors 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. Each Grantor
represents and warrants as follows:
(a) The chief place of business and chief executive
office of such Grantor and the office where such Grantor keeps its records
concerning the Accounts, and the originals of all chattel paper that evidence
Accounts, are located at its addresses specified in Schedule A hereto.
(b) Such Grantor is the legal and beneficial owner of its
Collateral free and clear of any lien, security interest, option or other
charge or encumbrance except for the security interest created by this
Agreement or any such lien, security interest, option, charge or encumbrance
permitted pursuant to Section 3.02(a) of the Reimbursement Agreement
(collectively, the "Permitted Liens"). No effective financing statement or
other document 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 Guarantor relating to this Agreement or in favor of a secured party with
respect to any Permitted Liens. The exact corporate name of such Grantor is as
set forth on the Schedule A hereto and such Grantor has no trade names and is
not doing business under or creating Accounts under any other name, in each
case, except as set forth in the Schedule A hereto. Each of the Grantors will
warrant and defend the Collateral against any claims and demands (other than
Permitted Liens) of all persons at any time claiming the same or any interest
in the Collateral adverse to the Guarantor.
(c) Subject to the rights of owners and clients with
respect to Equipment and Inventory located at project sites from time to time,
such Grantor has exclusive possession and control of its Equipment and
Inventory.
(d) This Agreement creates a valid 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 a first
priority security interest in the Collateral (subject, however, to Permitted
Liens) in respect of which a security interest can be perfected by filing under
the Code have been duly taken, except for the filing of one or more notices of
the assignment of Accounts pursuant to the Federal Assignment of Claims Act.
(e) No consent of any other Person and no authorization,
approval or other action by, and no notice to or filing with, any governmental
authority or regulatory body is required (i) for the grant by such Grantor of
the security interest granted hereby or for the execution, delivery or
performance of this Agreement by such Grantor, (ii) for the perfection or
maintenance of the security interest created hereby (including the first
priority nature (subject to Permitted Liens) of such security interest), other
than the execution and filing of appropriate financing statements under the
Code, or (iii) for the exercise by the Guarantor of its rights and remedies
hereunder, except in each case for the filing of one or more notices of the
assignment of Accounts pursuant to the Federal Assignment of Claims Act.
(f) Such Grantor has, independently and without reliance
upon the Guarantor and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement.
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SECTION 6. Further Assurances; Expenses. (a) The Grantors
agree that from time to time, at the expense of the Grantors, the Grantors will
promptly execute and deliver all further instruments and documents, and take
all further action, that may be necessary or desirable, or that the Guarantor
may request, to perfect and protect any security interest granted or purported
to be granted hereby or to enable the Guarantor 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) after the occurrence of
an Event of Default, if any Account shall be evidenced by a promissory note or
other instrument, deliver and pledge to the Guarantor hereunder such note or
instrument duly endorsed and accompanied by duly executed instruments of
transfer or assignment, all in form and substance satisfactory to the
Guarantor; (ii) subject to the terms of this Agreement, 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 Guarantor
may request, to perfect and preserve the security interest granted or purported
to be granted hereby; and (iii) file such notices and other documents under the
Federal Assignment of Claims Act as may be required from time to time with
respect to the Accounts.
(b) The Grantors hereby authorize the Guarantor 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 any
Grantor where permitted by law. A photocopy or other reproduction of this
Agreement or any financing statement covering the Collateral or any part
thereof shall be sufficient as a financing statement where permitted by law.
The Grantors agree to indemnify the Guarantor and its counsel from and against
any and all expenses, fees and other liabilities including, without limitation,
any recording and/or filing fees, taxes or other expenses relating to the
filing or recordation of financing and/or continuation statements.
(c) The Grantors will furnish to the Guarantor from time
to time statements and schedules further identifying and describing the
Collateral and such other reports in connection with the Collateral as the
Guarantor may reasonably request, all in reasonable detail.
(d) The Grantors agree to promptly execute and deliver
any and all instruments and take such other action as may be necessary to
remove or otherwise terminate any security interests in or liens on the
Collateral (other than Permitted Liens) whether or not in existence at the time
of execution of this Agreement or whether or not known by either Grantor on the
date hereof.
SECTION 7. As to Equipment and Inventory.
(a) The Grantors shall cause the Equipment to be
maintained and preserved in good condition, repair and working order, ordinary
wear and tear excepted, and shall forthwith, or in the case of any loss or
damage to any of the Equipment as quickly as practicable after the occurrence
thereof, make or cause to be made all repairs, replacements and other
improvements in connection therewith as are necessary or desirable to such end.
The Grantors shall promptly furnish to the Guarantor a statement respecting any
loss or damage to any of the Equipment in excess of $300,000.
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(b) The Grantors shall pay promptly when due all property
and other taxes, assessments and governmental charges or levies imposed upon,
and all claims (including claims for labor, materials and supplies) against,
the Equipment and Inventory.
(c) The Grantors each represents and warrants to the
Guarantor that all of such Grantor's Inventory is and will be held for sale or
lease, or to be furnished in connection with the rendition of services, in the
ordinary course of such Grantor's business, and is and will be fit for such
purposes. Each Grantor will keep its Inventory in good and marketable
condition, at its own expense.
SECTION 8. Insurance. (a) The Grantors shall, at their own
expense, maintain insurance with respect to the Collateral in such amounts,
against such risks, in such form and with such insurers, as is typical for
businesses similarly situated. After an Event of Default shall have occurred
and be continuing, the Grantors shall cause each policy for property damage
insurance covering the Inventory and Equipment to provide that all insurance
proceeds in respect of loss, damage or destruction of any such Inventory or
Equipment in excess of $100,000 per occurrence or in any related series of
occurrences or $300,000, in the aggregate, in any calendar year, are to be paid
directly to the Guarantor. Such amounts shall, subject to the limitations set
forth in this subsection (a) and in subsection (c) of this Section 8 and after
deducting from such proceeds the expenses, if any, incurred by the Guarantor in
the collection or handling thereof, be returned to such Grantor, which Grantor
shall make or cause to be made the necessary repairs to or replacements of such
Inventory or Equipment. All such replacements or repairs shall be made with
materials and property of substantially as good a quality as existed before
such loss, damage or destruction, and such Grantor shall commence the
replacement or repair of such property as soon as practicable and proceed
diligently with it until completion. Plans for any such repair or replacement
shall be reasonably satisfactory to the Guarantor and shall be subject to the
reasonable approval of the Guarantor prior to the release of insurance proceeds
to the applicable Grantor.
Each such property policy covering the Equipment or Inventory
shall in addition to the foregoing (i) name the appropriate Grantor and the
Guarantor as insured parties thereunder (without any representation or warranty
by or obligation upon the Guarantor) as their interests may appear, (ii)
provide that there shall be no recourse against the Guarantor for payment of
premiums or other amounts with respect thereto, (iii) provide that at least 30
days' prior written notice of cancellation of or lapse shall be given to the
Guarantor by the insurer, and (iv) contain a clause or endorsement stating that
the interest of the Guarantor shall not be impaired or invalidated by any act
or neglect of the Grantor insured thereunder or the owner of any premises for
purposes more hazardous than are permitted by such policy. After an Event of
Default shall have occurred and be continuing, each such property policy shall
also contain the agreement by the insurer that losses thereunder shall be
payable to the Guarantor, subject to the terms and limitations set forth in the
first sentence of this Section 8, notwithstanding any action, inaction or
breach of representation or warranty by the Grantor. The Grantors shall, if so
requested by the Guarantor, deliver to the Guarantor duplicate policies of such
insurance and, as often as the Guarantor may reasonably request, a report of a
reputable insurance broker with respect to such insurance. Further, the
Grantors shall, at the request of the Guarantor, duly execute and deliver
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instruments of assignment of such insurance policies to comply with the
requirements of Section 6 and cause the insurers to acknowledge notice of such
assignment.
(b) Reimbursement under any liability insurance
maintained by any Grantor pursuant to this Section 8 may be paid directly to
the Person who shall have incurred liability covered by such insurance.
(c) Notwithstanding anything contained herein to the
contrary, upon the occurrence and during the continuance of an Event of
Default, any loss, damage or destruction of any Inventory or Equipment in
excess of $1,000,000 in any one occurrence or in any related series of
occurrences any insurance proceeds in respect of such lost, damaged or
destroyed Equipment or Inventory shall be paid to the Guarantor and, at the
Guarantor's sole option, may be applied by the Guarantor (after deducting from
such proceeds the expenses, if any, incurred by the Guarantor in the collection
or handling thereof) as specified in Section 14(b). Notwithstanding anything
contained in this Agreement to the contrary, if any of the Grantors shall
receive any insurance proceeds which, pursuant to the terms of this Section 8,
are required to be delivered to the Guarantor, such Grantor (1) shall be deemed
to be holding such proceeds in trust for the Guarantor, (2) shall segregate
such proceeds from such Grantor's funds and (3) shall promptly upon its receipt
thereof remit such proceeds to the Guarantor in the same form as received by
such Grantor, other than for any necessary endorsements.
SECTION 9. As to Accounts. (a) Each Grantor shall keep its
chief place of business and chief executive office and the office where it
keeps its records concerning the Accounts, and the originals of all chattel
paper that evidence Accounts, at the location therefor specified in Section
5(a) or, upon 30 days' prior written notice to the Guarantor, at any other
locations in jurisdictions where all actions required by Section 6 shall have
been taken with respect to the Accounts. The Grantors will hold and preserve
such records and chattel paper and will permit the Guarantor or its
representatives at any time during normal business hours to inspect and make
abstracts from such records and chattel paper.
(b) Except as otherwise provided in this subsection (b),
the Grantors shall continue to collect, at their own expense, all amounts due
or to become due the Grantors under the Accounts. In connection with such
collections, the Grantors may take such action as the Grantors or the Guarantor
may deem necessary or advisable to enforce collection of the Accounts;
provided, however, that the Guarantor 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 Grantors of its intention to do so, to notify the account
debtors or obligors under any Accounts of the assignment of such Accounts to
the Guarantor and to direct such account debtors or obligors to make payment of
all amounts due or to become due to the Grantors thereunder directly to the
Guarantor and, upon such notification and at the expense of the Grantors, to
enforce collection of any such Accounts, and to adjust, settle or compromise
the amount or payment thereof, in the same manner and to the same extent as the
Grantors might have done. After receipt by the Grantors of the notice from the
Guarantor referred to in the proviso to the preceding sentence, (i) all amounts
and proceeds (including instruments) received by any Grantor in respect of the
Accounts shall be received in trust for the benefit of the Guarantor hereunder,
shall be segregated
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from other funds of such Grantor and shall be forthwith paid over to the
Guarantor in the same form as so received (with any necessary endorsement) and
either (A) released to the applicable 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 by Section 14(b), and (ii) the
Grantors shall not adjust, settle or compromise the amount or payment of any
Account, release wholly or partly any account debtor or obligor thereof, or
allow any credit or discount thereon.
SECTION 10. Transfers and Other Liens. The Grantors shall
not (i) sell, assign (by operation of law or otherwise) or otherwise dispose
of, or grant any option with respect to, any of the Collateral, except
Inventory and Equipment in the ordinary course of business and except as
otherwise expressly permitted under the terms of the Reimbursement Agreement,
or (ii) create or permit to exist any lien, security interest, option or other
charge or encumbrance upon or with respect to any of the Collateral, except for
Permitted Liens.
SECTION 11. Guarantor Appointed Attorney-in-Fact. Upon the
occurrence and during the continuance of an Event of Default, each Grantor
hereby irrevocably appoints the Guarantor as such Grantor's attorney-in-fact,
with full authority in the place and stead of such Grantor and in the name of
such Grantor or otherwise, from time to time in the Guarantor's discretion, to
take any action and to execute any instrument which the Guarantor may deem
necessary or advisable to accomplish the purposes of this Agreement (subject to
the rights of the Grantors under Section 9), including, without limitation:
(a) to obtain and adjust insurance required to be paid to
the Guarantor pursuant to Section 8,
(b) to ask, demand, collect, sue for, recover,
compromise, receive and give acquittance and receipts for moneys due
and to become due under or in connection with the Collateral,
(c) to receive, endorse and collect any drafts or other
instruments, documents and chattel paper, in connection therewith, and
(d) to file any claims or take any action or institute
any proceedings which the Guarantor may deem necessary or desirable
for the collection of any of the Collateral or otherwise to enforce
the rights of the Guarantor with respect to any of the Collateral.
SECTION 12. Guarantor May Perform. If any Grantor fails to
perform any agreement contained herein, the Guarantor may itself perform, or
cause performance of, such agreement, and the expenses of the Guarantor
(including, without limitation, reasonable attorney's fees and expenses)
incurred in connection therewith shall be payable by the Grantors under Section
15(b).
SECTION 13. The Guarantor's Duties. The powers conferred on
the Guarantor hereunder are solely to protect its interest in the Collateral
and shall not impose any duty upon it to exercise any such powers. Except for
the safe custody of any Collateral in its possession and
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the accounting for moneys actually received by it hereunder, the Guarantor
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 Guarantor 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
Continental accords its own property.
SECTION 14. Remedies. If any Event of Default shall have
occurred and be continuing:
(a) The Guarantor 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 Code (whether or not the Code
applies to the affected Collateral), and also may (i) require the
Grantors to, and the Grantors hereby agree that they will at their
expense and upon request of the Guarantor forthwith, assemble all or
part of the Collateral as directed by the Guarantor and make it
available to the Guarantor at a place to be designated by the
Guarantor which is reasonably convenient to the Guarantor and the
Grantors and (ii) 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 the Guarantor's offices or elsewhere, for
cash, on credit or for future delivery, and upon such other terms as
the Guarantor may deem commercially reasonable. The Grantors agree
that, to the extent notice of sale shall be required by law, at least
ten days' notice to the Grantors 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. The Guarantor shall not be
obligated to make any sale of Collateral regardless of notice of sale
having been given. The Guarantor 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.
(b) Any cash held by the Guarantor as Collateral and all
cash proceeds received by the Guarantor in respect of any sale of,
collection from, or other realization upon all or any part of the
Collateral may, in the discretion of the Guarantor, be held by the
Guarantor as collateral for, and/or then or at any time thereafter be
applied (after payment of any amounts payable to the Guarantor
pursuant to Section 15) in whole or in part by the Guarantor for the
benefit of the Guarantor against, all or any part of the Secured
Obligations in such order as the Guarantor shall elect. Any surplus
of such cash or cash proceeds held by the Guarantor and remaining
after payment in full of all the Secured Obligations shall be paid
over to the Grantors or to whomsoever may be lawfully entitled to
receive such surplus.
SECTION 15. Indemnity and Expenses. (a) The Grantors agree
to indemnify the Guarantor from and against any and all expenses, claims,
losses and liabilities (including reasonable attorneys' fees and disbursements)
growing out of or resulting from this Agreement (including, without limitation,
enforcement of this Agreement), except claims, losses or liabilities resulting
from the Guarantor's gross negligence or willful misconduct.
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(b) The Grantors will upon demand pay to the Guarantor
the amount of any and all reasonable expenses, including the reasonable fees
and expenses of its counsel and of any experts and agents, which the Guarantor
may incur in connection with (i) the custody, preservation, use or operation
of, or the sale of, collection from, or other realization upon, any of the
Collateral, (ii) the exercise or enforcement of any of the rights of the
Guarantor hereunder or (iii) the failure by any Grantor to perform or observe
any of the provisions hereof.
SECTION 16. Amendments, Etc. No amendment or waiver of any
provision of this Agreement, and no consent to any departure by the Grantors
herefrom, shall in any event be effective unless the same shall be in writing
and signed by the Guarantor or the Grantors, and then such waiver or consent
shall be effective only in the specific instance and for the specific purpose
for which given.
SECTION 17. Notices. All notices and other communications
required or desired to be served, given or delivered hereunder shall be given
in the manner and to the addresses set forth in the Reimbursement Agreement.
SECTION 18. Continuing Security Interest; Assignments under
Reimbursement Agreement. This Agreement shall create a continuing security
interest in the Collateral and shall (i) remain in full force and effect until
the later of (x) the payment in full of the Secured Obligations and all other
amounts payable under this Agreement, (y) the expiration or termination of the
Reimbursement Agreement and (z) the expiration or termination of the Guaranty,
(ii) be binding upon the Grantors, their successors and assigns and (iii) inure
to the benefit of, and be enforceable by, the Guarantor and its successors,
transferees and assigns. Upon the payment in full of the Secured Obligations,
the security interest granted hereby shall terminate and all rights to the
Collateral shall revert to the respective Grantors. Upon any such termination,
the Guarantor will, at the Grantors' expense, execute and deliver to the
Grantors such documents as the Grantors shall reasonably request to evidence
such termination.
SECTION 19. Governing Law. THIS AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF ILLINOIS, 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 ILLINOIS.
SECTION 20. Joint and Several Obligations. Except to the
extent the context may otherwise necessarily imply, all obligations and
agreements of the Grantors hereunder shall be joint and several.
SECTION 21. Incorporation of Preliminary Statements. The
Preliminary Statements to this Agreement are hereby incorporated herein by this
reference thereto.
SECTION 22. Counterparts. This Agreement may be executed in
any number of counterparts, and by the Guarantor and any of the Grantors in
separate counterparts, each of which shall be an original, but all of which
shall together constitute one and the same agreement.
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SECTION 23. Captions. The captions contained in this
Agreement are for convenience of reference only, are without substantive
meaning and should not be construed to modify, enlarge, or restrict any
provision.
SECTION 24. Severability of Provisions. Any provision of
this Agreement or of any other instrument, document or agreement executed
and/or delivered in connection herewith which is prohibited or unenforceable in
any jurisdiction shall, as to such jurisdiction, be ineffective to the extent
of such prohibition or unenforceability without invalidating the remaining
provisions hereof or thereof or affecting the validity or enforceability of
such provision in any other jurisdiction.
IN WITNESS WHEREOF, the Grantors have caused this Agreement to
be duly executed and delivered by their respective officers thereunto duly
authorized as of the date first above written.
OHM CORPORATION
By:_______________________________
Name:_________________________
Title:________________________
Attest:
____________________________
Secretary
OHM REMEDIATION SERVICES CORP.
By:_______________________________
Name:_________________________
Title:________________________
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SCHEDULE A
TO
SECURITY AGREEMENT
Grantor Location of Chief Executive Office
------- ----------------------------------
OHM Corporation 16406 U.S. Route 224 East
Findlay, OH 45840
OHM Remediation Services Corp. 16406 U.S. Route 224 East
Findlay, OH 45840
Records concerning
Accounts also kept at: 200 Horizon Center Boulevard
Trenton, NJ 08650
5335 Triangle Parkway
Suite 450
Norcross, GA 30092
5731 West Las Positas Blvd.
Pleasanton, CA 94588
Trade Names: None.
Records concerning
Account also kept at: None.
Trade Names: None.