GENERAL SECURITY AGREEMENT
In consideration of loans, credit or other financial accommodations extended
or continued from time to time to, or on the guaranty, endorsement or other
assurance of, the undersigned ("Obligor") by RZB Finance LLC (together with
its successors and assigns, "RZB"), Obligor hereby agrees as follows:
1. Security Interest.
a. To secure the full and punctual payment and performance of all of the
Obligations (as hereinafter defined), Obligor hereby grants to RZB a
continuing security interest in, and assigns and pledges to RZB, the
Collateral (as hereinafter defined).
b. "Obligations" shall mean and include all indebtedness, liabilities,
obligations, covenants and duties of Obligor to RZB or any Affiliate of RZB
(including those which RZB or such Affiliate may have acquired from others) of
every kind, nature and description, direct or indirect, absolute or
contingent, due or not due, contractual or tortious, liquidated or
unliquidated, arising by operation of law or otherwise, now existing or
hereafter arising, and whether or not evidenced by any note or other
instrument or agreement and whether or not for the payment of money,
including, but not limited to, indebtedness, obligations and liabilities to
RZB or such Affiliate of Obligor as a member of any partnership, syndicate,
association or other group.
c. Affiliate and certain other terms used herein are defined in Section
15 hereof.
d. "Collateral" shall mean and include all personal property and
fixtures of Obligor, whether now or hereafter existing or now owned or
hereafter acquired and wherever located, of every kind and description,
tangible or intangible, including, but not limited to, the following (each as
hereinafter defined):
(i) Accounts;
(ii) Inventory;
(iii) General Intangibles;
(iv) Documents;
(v) Instruments;
(vi) Equipment;
(vi) All books and records (including, without limitation, customer
lists, credit files, computer programs, printouts and other computer materials
and records) of Obligor pertaining to any of the Collateral; and
(vii) All Proceeds of all or any of the foregoing.
e. "Accounts" means all "accounts" (as defined in the UCC) now owned or
hereafter acquired by Obligor, and shall also mean and include all accounts
receivable, contract rights, book debts, notes, drafts and other obligations
or indebtedness owing to Obligor arising from the sale, lease or exchange of
goods or other property by it and/or the performance of services by it
(including, without limitation, any such obligation which might be
characterized as an account, contract right or general intangible under the
Uniform Commercial Code in effect in any jurisdiction) and all of Obligor's
rights in, to and under all purchase orders for goods, services or other
property, and all of Obligor's rights to any goods, services or other property
represented by any of the foregoing (including returned or repossessed goods
and unpaid sellers' rights of rescission, replevin, reclamation and rights to
stoppage in transit) and all monies due to or to become due to Obligor under
all contracts for the sale, lease or exchange of goods or other property
and/or the performance of services by it (whether or not yet earned by
performance on the part of Obligor), in each case whether now in existence or
hereafter arising or acquired including, without limitation, the right to
receive the proceeds of said purchase orders and contracts and all collateral
security and guarantees of any kind given by any person, corporation or other
entity with respect to any of the foregoing.
f. "Documents" means all "documents" (as defined in the UCC) or other
receipts covering, evidencing or representing goods, now owned or hereafter
acquired by Obligor and shall include, without limitation, all bills of
lading, dock warrants, dock receipts, warehouse receipts and orders for the
payment of goods and pipeline tickets.
g. "Equipment" means all "equipment" (as defined in the UCC) now owned
or hereafter acquired by Obligor, including without limitation all motor
vehicles, trucks, trailers, railcars and barges.
h. "General Intangibles" means all "general intangibles" (as defined in
the UCC) now owned or hereafter acquired by Obligor, including, without
limitation, (i) all obligations or indebtedness owing to Obligor (other than
Accounts) from whatever source arising, (ii) Obligor's right, title and
interest in, to and under all tax refund claims, (iii) Obligor's right, title
and interest in, to and under any and all accounts for the purchase and sale
of commodity futures contracts, commodity options, commodity swaps, caps,
collars or floors, forward or leverage contracts and/or actual or cash
commodities, any and all property or funds held in or for such accounts, any
and all agreements with brokers with respect to such accounts, and any rights
to receive payments in respect of such accounts and agreements, and (iv) all
patent licenses, patents, trademark licenses, trademarks, rights in
intellectual property, goodwill, trade names, service marks, trade secrets,
copyrights, permits and licenses.
i. "Instruments" means all "instruments", "chattel paper" and "letters
of credit" (each as defined in the UCC), including, without limitation, any
thereof evidencing, representing, arising from or existing in respect of,
relating to, securing or otherwise supporting the payment of, any of the
Accounts or General Intangibles, including (but not limited to) promissory
notes, drafts, bills of exchange and trade acceptances, now owned or hereafter
acquired by Obligor.
j. "Inventory" means all "inventory" (as defined in the UCC), now owned
or hereafter acquired by Obligor, wherever located, and shall also mean and
include, without limitation, all commodities, all raw materials and other
materials and supplies, work-in-process and finished goods and any products
made or processed therefrom and all substances, if any, commingled therewith
or added thereto.
k. "Proceeds" has the meaning set forth in the UCC.
l. "UCC" means the Uniform Commercial Code in effect on the date hereof
in the State of New York; provided that if by reason of mandatory provisions
of law, the perfection or the effect of perfection or non-perfection of the
security interest in any Collateral is governed by the Uniform Commercial Code
as in effect in a jurisdiction other than New York, "UCC" means the Uniform
Commercial Code as in effect in such other jurisdiction for purposes of the
provisions hereof relating to such perfection or effect of perfection or
non-perfection.
2. Rank and Perfection of Security Interest.
a. Obligor will not create or permit to exist, nor shall there exist,
any security interest in, lien, attachment, levy or encumbrance upon, or
assignment or pledge as security of, any of the Collateral, except the
security interest of and assignment and pledge to RZB hereunder and Permitted
Liens.
(i) Obligor will from time to time, at its expense, take all action
requested by RZB, or which may be necessary or desirable, to perfect,
continue, evidence, preserve, protect or validate the security interest of and
assignment and pledge to RZB hereunder to enable RZB to exercise and enforce
its rights hereunder, including, but not limited to, (A) executing and
delivering one or more notices, financing statements, agreements or other
writings, and (B) delivering to RZB, and stamping or otherwise marking, in
such manner as RZB may specify, any and all chattel paper, Instruments,
letters and advice of credit and Documents constituting part of the
Collateral, in each case endorsed or accompanied by such instruments of
assignment as RZB may specify.
(ii) Obligor hereby authorizes RZB, at its option but without any
obligation so to do, to file financing and continuation statements and
amendments to financing statements, naming Obligor as debtor, with respect to
any of the Collateral without the signature of Obligor, and agrees that a
carbon, photographic or other reproduction of this Agreement or of a financing
statement is sufficient as a financing statement. Obligor shall pay the costs
of any recording or filing of any financing or continuation statements, or
amendments thereto, concerning the Collateral.
3. Covenants.
a. Obligor shall at all times: (i) be the sole owner of each and every
item of Collateral, (ii) defend the Collateral against the claims and demands
of all persons and (iii) in the case of tangible property constituting part of
the Collateral, (A) properly maintain and keep in good order and repair such
property and (B) keep such property fully insured with responsible companies
acceptable to RZB against such risks as such Collateral may be subject to, or
as RZB may request, under policies containing loss payable clauses naming RZB
as loss payee as its interests may appear and otherwise in form and substance
satisfactory to RZB, and providing that: (1) all proceeds thereof shall be
payable to RZB, (2) such insurance shall not be affected by any act or neglect
of Obligor or other owner of the property described in such policy, and (3)
such policy and loss payable clause may not be cancelled or amended except
upon ten days' prior written notice to RZB.
b. Obligor will comply with the requirements of all leases, mortgages
and other instruments relating to premises where any Collateral is located.
c. Obligor will not sell or otherwise dispose of any of the Collateral,
except that, if the same constitute Collateral, until notice terminating such
authority is given by RZB to Obligor, (i) accounts may be collected in the
ordinary course of business as heretofore conducted and (ii) Inventory or farm
products may be sold in the ordinary course of business as heretofore
conducted.
d. Obligor will give RZB not less than 30 days prior written notice of
(i) any change in (A) its name, identity or corporate structure, (B) the
location of its chief executive office or any other place of business, or (C)
the location of any of the Collateral or its books and records concerning any
Accounts, (ii) the location of each new place of business opened by Obligor,
and (iii) each new location of any Collateral. Obligor will give RZB prompt
notice of any loss or depreciation in the value of any of the Collateral. Set
forth on Schedule A annexed hereto are all trade names or trade styles used by
Obligor, the location of Obligor's chief executive office, all locations of
Collateral and all locations of Obligor's books and records.
e. At any time and from time to time (i) RZB may and is hereby
authorized to transfer into or register in the name of itself or its nominee
any Instruments or Documents constituting a part of the Collateral without
notice to Obligor, (ii) with respect to Instruments, if any, constituting a
part of the Collateral that are registered in the name of RZB, RZB may receive
and retain all Distributions (as hereinafter defined in Section 15), (iii)
Obligor will permit representatives of RZB during normal business hours to
inspect its premises and books and records pertaining to the Collateral and
make extracts from and copies of such books and records, and (iv) upon
request, Obligor will enter into warehousing, lockbox or other custodial
arrangements satisfactory to RZB.
f. If any Collateral is at any time in the possession or control of any
warehouseman, bailee or any of Obligor's agents or processors, Obligor shall
notify such warehouseman, bailee, agent or processor of the security interests
created hereby and to hold all such Collateral for RZB'S account subject to
RZB's instructions.
g. Obligor shall keep full and accurate books and records relating to
the Collateral, and stamp or otherwise mark such books and records in such
manner as RZB may reasonably require in order to reflect the security interest
granted hereby.
h. Obligor will immediately deliver and pledge to RZB or RZB's agent
each Instrument, now owned or hereafter acquired, appropriately endorsed to
RZB or RZB's agent.
i. Obligor shall use its best efforts to cause to be collected from its
account debtors and obligors, as and when due, any and all amounts owing under
or on account of each Account, each General Intangible and each Instrument
(including, without limitation, Accounts, General Intangibles and Instruments
which are delinquent, such Accounts, General Intangibles and Instruments to be
collected in accordance with lawful collection procedures) and apply forthwith
upon receipt thereof all such amounts as are so collected to the outstanding
balance of such Account, General Intangible and Instrument. From and after
the occurrence of an Event of Default (as hereinafter defined), (i) any such
amounts so collected by Obligor shall be promptly remitted to RZB, in
precisely the form received (except for endorsement by Obligor when required),
and until so remitted to RZB, shall be held by Obligor in trust for RZB, and
shall not be commingled with other funds or property of Obligor, and RZB shall
be entitled to apply such amounts to the Obligations in such manner as RZB in
its sole discretion shall determine, and (ii) Obligor will not renew or extend
the time of payment of any Account without the written consent of RZB. The
costs and expenses (including, without limitation, attorneys' fees) of
collection, whether incurred by Obligor or RZB, shall be borne by Obligor.
j. Upon request by RZB, Obligor will promptly notify (and Obligor hereby
authorizes RZB so to notify) each account debtor or obligor in respect of any
Account, General Intangible or Instrument that such Collateral has been
assigned to RZB hereunder, and that any payments due or to become due in
respect of such Collateral are to be made directly to RZB or its designee.
k. Obligor will, promptly upon request, provide to RZB all information
and evidence it may reasonably request concerning the Collateral, and in
particular the Accounts, to enable RZB to enforce the provisions of this
Agreement.
4. General Authority. Obligor hereby irrevocably appoints RZB its true and
lawful attorney, with full power of substitution, in the name of Obligor, RZB,
or otherwise, for the sole use and benefit of RZB, but at Obligor's expense,
to the extent permitted by law to exercise, at any time and from time to time
while an Event of Default (as hereinafter defined) exists, all or any of the
following powers with respect to all or any of the Collateral:
a. to demand, sue for, collect, receive and give acquittance for any and
all monies due or to become due thereon or by virtue thereof,
b. to settle, compromise, compound, prosecute or defend any action or
proceeding with respect thereto,
c. to take any action or do any thing which Obligor is required to do
hereunder,
d. to extend the time of payment of any or all thereof and to make any
allowance and other adjustments with reference thereto, and
e. to do all other acts and things necessary and advisable in the sole
discretion of RZB to carry out and enforce this Agreement.
5. Events of Default. Without limiting the right of RZB to demand
payment of any or all of the Obligations at any time in its sole discretion,
it shall be an Event of Default if any of the following events shall occur:
(i) default in payment of any of the Obligations when due, whether on demand
or otherwise; or (ii) the occurrence of any "Event of Default" or "default" as
defined or specified in any agreement, instrument or document evidencing or
providing for the Obligations or any guaranty thereof.
6. Remedies upon Event of Default Rights. Upon the occurrence of an Event of
Default and at any time or from time to time thereafter:
a. RZB may declare, by notice to Obligor, any and all of the Obligations
immediately due and payable, without any other presentment, demand, protest or
notice of any kind, anything in any other agreement to the contrary
notwithstanding, and in the case of any bankruptcy, insolvency or similar
proceeding relating to Obligor or its property, all of the Obligations shall
automatically become due and payable (provided, however, that the foregoing
shall not be deemed to limit or impair in any way whatsoever the absolute
right of RZB to demand payment of the Obligations at any time in its sole
discretion, to the extent the agreements and instruments pertaining to such
Obligations provide for such demand);
b. RZB shall have no obligation to make further loans, extensions of
credit or other financial accommodations to or on behalf of Obligor, anything
in any other agreement to the contrary notwithstanding (provided, however,
that the foregoing shall not be deemed to limit or impair in any way
whatsoever the sole and absolute discretion of RZB to make or refrain from
making such loans, extensions of credit or financial accommodations to the
extent the agreements and instruments pertaining thereto provide for such
discretion);
c. RZB may exercise all other rights to which it is entitled hereunder
or under applicable law;
d. RZB may exercise all rights of a secured party under the UCC (whether
or not in effect in the jurisdiction where such rights are exercised) and, in
addition, RZB may sell the Collateral or any part thereof at public or private
sales, for cash, upon credit or for future delivery, and at such price or
prices as RZB may deem satisfactory. RZB may be the purchaser of any or all
of the Collateral so sold at any public sale (or, if the Collateral is of a
type customarily sold in a recognized market or is of a type which is the
subject of widely distributed standard price quotations, at any private sale)
and thereafter hold the same, absolutely, free from any right or claim of
whatever kind. Obligor will execute and deliver such documents and take such
other action as RZB deems necessary or advisable in order that any such sales
may be made in compliance with law. Upon any such sales RZB shall have the
right to deliver, assign and transfer to the purchaser thereof the Collateral
so sold. Each purchaser at any such sales shall hold the Collateral so sold
to it absolutely, free from any claim or right of whatever kind, including any
equity or right of redemption of Obligor, and to the extent permitted by law,
Obligor hereby specifically waives all rights of redemption, stay or appraisal
which it has or may have under any law now existing or hereafter adopted. The
notice (if any) of such sale required herein shall (i) in the case of a public
sale, state the time and place fixed for such sale, and (ii) in the case of
private sale, state the day after which such sale may be consummated. Any
such public sale shall be held at such time or times within ordinary business
hours and at such place or places as RZB may fix in the notice of such sale.
Unless the Collateral is perishable or threatens to decline speedily in value
or is of a type customarily sold on a recognized market, RZB will give Obligor
reasonable notice of the time and place of any such public sale or of the time
after which any private sale or any other intended disposition thereof is to
be made, and Obligor agrees that five (5) days prior notice shall be deemed
reasonable notice. At any such sale the Collateral may be sold in one lot as
an entirety or in separate parcels, as RZB may determine. RZB shall not be
obligated to make any such sale pursuant to any such notice. RZB may without
notice or publication, adjourn any public or private sale or cause the same to
be adjourned from time to time by announcement at the time and place fixed for
the sale, and such sale may be made at any time or place to which the same may
be so adjourned. In case of any sale of all or any part of Collateral on
credit or for future delivery, the Collateral sold may be retained by RZB
until the selling price is paid by the purchaser thereof, but RZB shall not
incur any liability in case of the failure of such purchaser to take up and
pay for the Collateral so sold and, in case of any such failure, such
Collateral may again be sold upon like notice. RZB, instead of exercising the
power of sale herein conferred upon it, may proceed by a suit or suits at law
or in equity to foreclose the security interests granted herein and sell the
Collateral, or any portion thereof, under a judgment or decree of a court or
courts of competent jurisdiction.
e. For the purposes of enforcing any and all rights and remedies under
this Agreement, RZB may (i) require Obligor to, and Obligor agrees that it
will, at its expense and upon the request of RZB, forthwith assemble all or
any part of the Collateral as directed by RZB and make it available at a place
designated by RZB which is, in its opinion, reasonably convenient to RZB
whether at the premises of Obligor or otherwise, (ii) to the extent permitted
by applicable law, enter, with or without process of law and without breach of
the peace, any premises where any of the Collateral is or may be located, and
without charge or liability to it, seize and remove such Collateral from such
premises, (iii) have access to and use Obligor's books and records relating to
the Collateral and (iv) prior to the disposition of the Collateral, store or
transfer it without charge in or by means of any storage or transportation
facility owned or leased by Obligor or any other person, corporation or other
entity, process, repair or recondition it or otherwise prepare it for
disposition in any manner and to the extent RZB deems appropriate and, in
connection with such preparation and disposition, use without charge any
trademark, trade name, copyright, patent or technical process used by Obligor.
f. If the Collateral consists in whole or in part of Instruments and RZB
elects to sell or otherwise dispose of such Instruments, (i) Obligor will, if
it controls the issuer of such Instruments, or it otherwise has the right to
effect such registration, and if RZB deems such registration to be desirable,
cause such Instruments to be registered under the Securities Act of 1933, as
amended, and take all other action, including but not limited to complying
with the "blue sky" or securities laws of the several states and delivering to
RZB appropriate quantities of prospectuses, necessary or appropriate so as to
permit the public sale or other disposition thereof by RZB in such
jurisdictions as RZB may select, and indemnify, in the form then customary,
all persons who are underwriters, statutory or otherwise, of such Instruments
in connection with such sale or disposition, such indemnity, to the extent
applicable to RZB, to be in addition to that afforded RZB under Section 10(c)
hereof, and (ii) RZB may elect not to exercise its rights under clause (i) and
in that event may, if in its judgment it shall be necessary or desirable so to
do, restrict the number of prospective bidders so as to comply with the
provisions of Section 5 of such Securities Act, and restrict such prospective
bidders to persons who will represent and agree that they are purchasing the
Instruments in question for their own account for investment and not with a
view to the distribution or release of any thereof and who will further agree
that such Instruments purchased by them may bear an appropriate restrictive
legend to that effect.
Limitation 7. on Duty of RZB in Respect of Collateral. Beyond the safe
custody thereof, RZB shall have no duty as to any Collateral in its possession
or control or in the possession or control of any agent or bailee or as to any
income thereon or as to the preservation of rights against prior parties or
any other rights pertaining thereto. RZB shall be deemed to have exercised
reasonable care in the custody and preservation of the Collateral in its
possession if the Collateral is accorded treatment substantially equal to that
which it accords its own property, and shall not be liable or responsible for
any loss or damage to any of the Collateral, or for any diminution in value
thereof, by reason of the act or omission of any warehouseman, carrier,
forwarding agency, consignee or other agent or bailee selected by RZB in good
faith.
8. Application of Proceeds. Upon any demand for payment of any or all of the
Obligations or upon the occurrence and during the continuance of any other
Event of Default, the proceeds of any sale of, or other realization upon, all
or any part of the Collateral shall be applied by RZB in the following order
of priority:
a. to payment of the expenses of such sale or other realization,
including reasonable compensation to (and costs and disbursements of) agents
and counsel for RZB, and all expenses, liabilities and advances incurred or
made by RZB in connection therewith, and any other unreimbursed expenses for
which RZB is to be reimbursed pursuant to the documents or instruments
evidencing or governing any of the Obligations;
b. to the payment of accrued but unpaid interest on the Obligations in
accordance with the provisions of any promissory note, letter of credit
reimbursement agreement or other agreement or instrument evidencing any of the
Obligations;
c. to the payment of unpaid principal of the Obligations;
d. to the payment of all other Obligations, until all Obligations shall
have been paid in full; and
e. to payment to Obligor or its successors or assigns, or to whomsoever
may be entitled thereto, or as a court of competent jurisdiction may direct,
of any surplus then remaining from such proceeds.
If, upon the sale, lease or other disposition of the Collateral, the
proceeds thereof are insufficient to pay all amounts to which RZB is legally
entitled, Obligor will remain liable for the deficiency, together with
interest thereon at the rate provided for post-maturity interest in the
agreements and instruments evidencing the Obligations.
9. General Representations, Warranties and Agreements. Obligor hereby
represents, warrants and agrees that:
a. The execution, delivery and performance of this Agreement are within
its powers, corporate or otherwise, have been duly authorized by all required
action and do not and will not contravene any law or any agreement or
undertaking to which it is a party or by which it may in any way be bound or,
if Obligor is a corporation, its certificate of incorporation or by-laws.
b. Each of the representations and warranties contained herein is true
and correct on the date hereof and all other information, including financial
statements and projections, furnished to RZB at any time by or on behalf of
Obligor was and will be complete and correct in all respects to the extent
necessary for the purpose of presenting the subject matter thereof fairly to
RZB.
10. Expenses of Obligor's Duties; RZB's Rights to Perform on Obligor's
Behalf; RZB's Expenses and Indemnification.
a. Obligor's agreements and duties hereunder shall be performed by it at
its sole cost and expense.
b. If Obligor shall fail to do any act or thing which it has covenanted
to do hereunder, RZB may (but shall not be obligated to) do the same or cause
it to be done, either in its name or in the name and on behalf of Obligor, and
Obligor hereby irrevocably authorizes RZB so to act.
c. Obligor agrees to reimburse RZB for all costs and expenses, including
attorneys' fees and disbursements, incurred, and to indemnify and hold RZB
harmless from and against all losses suffered, by RZB in connection with (i)
RZB's exercise of any right or remedy granted to it hereunder, (ii) any claim
and the prosecution or defense thereof arising out of or in any way connected
with this Agreement, and (iii) the collection or enforcement of the
Obligations.
d. Amounts payable by Obligor under this Section 10 shall constitute
Obligations which shall be payable on demand.
11. No Waivers of Rights Hereunder; Rights Cumulative.
a. No delay by RZB in exercising any right hereunder, or under any of
the other Obligations, shall operate as a waiver thereof, nor shall any single
or partial exercise of any right preclude other or further exercises thereof
or the exercise of any other right. No waiver or amendment of any provision
of this Agreement or of any of the other agreements, instruments or documents
evidencing the Obligations shall be enforceable against RZB unless it shall be
in writing, be signed by RZB, and expressly refer to the provision affected;
any such waiver shall be limited solely to the specific event waived.
b. All rights granted to RZB hereunder shall be cumulative and shall be
supplementary of and in addition to those granted or available to RZB with
respect to the other Obligations or under applicable law and nothing herein
shall be construed as limiting any such other right.
12. Assignment, Participations.
a. RZB may assign any or all of the Obligations and may transfer
therewith any or all of the Collateral therefor and the transferee shall have
the same rights with respect thereto as had RZB. Upon such transfer, RZB
shall be released from all responsibility for the Collateral so transferred.
b. RZB may from time to time sell or otherwise grant participations in
any of the Obligations and any Collateral for the Obligations. Obligor agrees
that each such holder of a participation may exercise any and all rights of
banker's lien, set-off and counterclaim with respect to its participation in
the Obligations as fully as though Obligor were directly indebted to such
holder in the amount of such participation.
13. Continuing Agreement; Termination.
a. This Agreement shall be a continuing agreement and shall apply to all
present and future Obligations, notwithstanding that at any particular time
all of the Obligations then outstanding shall have been paid in full.
b. This Agreement shall continue in full force and effect until written
notice of termination shall have been signed by RZB.
14. Governing Law; Jurisdiction; Certain Waivers.
a. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY
THE LAWS OF THE STATE OF NEW YORK, EXCEPT AS OTHERWISE REQUIRED BY MANDATORY
PROVISIONS OF LAW.
b. OBLIGOR HEREBY AGREES THAT ANY LEGAL ACTION OR PROCEEDING AGAINST
OBLIGOR WITH RESPECT TO THIS AGREEMENT MAY BE BROUGHT IN THE COURTS OF THE
STATE OF NEW YORK IN THE CITY OF NEW YORK OR OF THE UNITED STATES OF AMERICA
FOR THE SOUTHERN DISTRICT OF NEW YORK AS RZB MAY ELECT, AND, BY EXECUTION AND
DELIVERY HEREOF, OBLIGOR ACCEPTS AND CONSENTS TO, FOR ITSELF AND IN RESPECT TO
ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID
COURTS AND AGREES THAT SUCH JURISDICTION SHALL BE EXCLUSIVE, UNLESS WAIVED BY
RZB IN WRITING, WITH RESPECT TO ANY ACTION OR PROCEEDING BROUGHT BY IT AGAINST
RZB. NOTHING HEREIN SHALL LIMIT THE RIGHT OF RZB TO BRING PROCEEDINGS AGAINST
OBLIGOR IN THE COURTS OF ANY OTHER JURISDICTION. OBLIGOR AGREES THAT SECTIONS
5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK
SHALL APPLY TO THIS AGREEMENT AND, TO THE MAXIMUM EXTENT PERMITTED BY LAW,
WAIVES ANY RIGHT TO STAY OR TO DISMISS ANY ACTION OR PROCEEDING BROUGHT BEFORE
SAID COURTS ON THE BASIS OF FORUM NON CONVENIENS.
c. Obligor waives personal service of process and consents that service
of process upon it may be made by certified or registered mail, return receipt
requested, directed to Obligor at its address last specified for notices
hereunder, and service so made shall be deemed completed five days after the
same shall have been so mailed.
d. EACH OF RZB AND OBLIGOR HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVES ANY AND ALL RIGHTS IT MAY HAVE TO A TRIAL BY JURY IN
RESPECT OF ANY LITIGATION BASED ON, OR ARISING OUT OF, UNDER OR IN CONNECTION
WITH THIS AGREEMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER VERBAL OR WRITTEN) OR ACTIONS OF OBLIGOR OR RZB. THIS PROVISION IS A
MATERIAL INDUCEMENT FOR RZB'S EXTENDING CREDIT TO OBLIGOR.
15. Definitions. As used herein:
a. Except as otherwise specifically defined herein, all terms defined in
Article 1 or 9 of the New York Uniform Commercial Code as in effect on the
date of this Agreement (other than the term "Collateral") are used herein with
the meanings therein given.
b. The following terms shall have the indicated meanings:
"Affiliate" of RZB shall mean a corporation that directly or
indirectly controls or is controlled by, or is under common control with, RZB.
"Distributions" shall mean cash dividends and other distributions
and interest paid in cash, in each case with respect to all Instruments
constituting part of the Collateral.
"Guarantor" shall mean any maker, drawer, acceptor, endorser,
guarantor, surety, accommodation party or other person liable upon or for any
of the Obligations.
"Permitted Liens" shall mean liens specifically consented to by RZB
in writing, and liens of any other financial institution which is a party to
an intercreditor agreement with RZB in form and substance satisfactory to RZB.
16. Notices. Any notice or request hereunder may be given to Obligor or to
RZB at their respective addresses set forth below or at such other address as
may hereafter be specified in a notice designated as a notice of change of
address under this Section. Any notice or request hereunder may be given by,
in the case of notices or requests to Obligor, mail, commercial courier
service, telex, or telegram, or by telephone subsequently confirmed by mail,
commercial courier service, return receipt requested, or by and in the case of
notices to RZB, registered mail, telex or telegram, subsequently confirmed by
such registered mail. Notices and requests to Obligor shall, in the case of
those by mail, commercial courier service, telex or telegram, be deemed to
have been given when deposited in the mail, first-class postage prepaid, or
delivered to such courier service, the telegraph office or telex operator,
addressed as provided in this Section, and in the case of those by telephone,
when so communicated to Obligor; notices to RZB shall be deemed to have been
given only when actually received by RZB at its address determined as provided
in this Section. Any requirement under applicable law of reasonable notice by
RZB to Obligor of any event shall be met if notice is given to Obligor in the
manner prescribed above at least seven days before (a) the date of such event
or (b) the date after which such event will occur.
17. General.
a. If this Agreement is executed by two or more Obligors, they shall be
jointly and severally liable hereunder, all provisions hereof regarding the
Obligations or the Collateral shall apply to the Obligations and Collateral of
any or all of them and the termination of this Agreement as to one or more of
such Obligors shall not terminate this Agreement as to any remaining Obligors.
b. This Agreement shall be binding upon the heirs, executors,
administrators, assigns or successors of each of the undersigned Obligors and
shall inure to the benefit of and be enforceable by RZB, its successors,
transferees and assigns.
c. If any provision hereof is invalid and unenforceable in any
jurisdiction, then, to the fullest extent permitted by law, (i) the other
provisions hereof shall remain in full force and effect in such jurisdiction
and shall be liberally construed in favor of RZB in order to carry out the
intentions of the parties hereto as nearly as may be possible, and (ii) the
invalidity or unenforceability of any provision hereof in any jurisdiction
shall not affect the validity or enforceability of such provision in any other
jurisdiction.
Dated: 10/17, 1997 .
PENN OCTANE CORPORATION
By: /s/ J.B. Richter
Title: President
By:
Title:
Address of Obligor:
One William Street Telephone:
New York, New York 10004 Telefax:
Telex:
Accepted: 10/22, 1997
RZB FINANCE LLC
By: Pearl Geffers
Title: Vice President
By: Dieter Beintrexler
Title: President
Address of RZB:
RZB FINANCE LLC Telephone:
1133 Avenue of the Americas Telefax: New York, New York
10036 Telex:
SCHEDULE A
1. Trade Names or Trade Styles used by Obligor.
2. Obligor's Chief Executive Office.
3. All Locations of Collateral.
4. All Locations of Obligor's Books and Records.