Exhibit 10.10
Security Agreement for Senior Note dated October 5, 2002 in the amount of
$362,500 between NatureWell, Incorporated ("Debtor") and ▇▇▇▇▇ ▇. Arabia
("Holder").
SECURITY AGREEMENT
THIS SECURITY AGREEMENT ("Agreement") is made as of October 5, 2002
between NatureWell, Incorporated, a Delaware corporation ("Debtor"), and ▇▇▇▇▇
▇. Arabia, an individual ("Secured Party"), who agree as follows:
1. Recitals This Agreement is entered into in contemplation of the
following facts and circumstances:
a. Debtor has executed and delivered to Secured Party that certain
Senior Note made of even date herewith in the original principal amount of
$362,500 and all accrued and unpaid interest and all amendments and addendums
thereto (the"Senior Note").
b. Debtor has agreed to secure its performance under the Senior
Note by giving Secured Party a security interest in the Collateral (as defined
below).
2. GRANT OF SECURITY INTEREST. As security for Debtor's performance of
each and all of its obligations under the Senior Note, Debtor hereby grants
and assigns to Secured Party a security interest in all of Debtor's right,
title, and interest in and to the assets more particularly described on
Schedule 1 attached hereto and incorporated herein by this reference
(collectively, the "Collateral"). Debtor hereby consents to the filing of
UCC Statements by the Secured Party to reflect the security interest.
3. REPRESENTATIONS, WARRANTIES, AND COVENANTS. Debtor represents,
warrants, and covenants to Secured Party as follows:
a. Debtor owns the Collateral and has the requisite right, power,
and authority to encumber, assign, and deliver the Collateral to Secured Party
or its designated agent, as required by the terms and provisions of this
Agreement, and such assignment and delivery will be free and clear of all prior
claims, liens, security interests, charges, and encumbrances of any kind and
nature, except those in favor of Secured Party.
b No consent or approval (other than any which may be incidental
to any filing with a filing officer to perfect the security interests in the
Collateral) of any governmental body, regulatory authority, person, trust, or
entity is or will be (i) necessary to the validity of the rights created
hereunder, or (ii) required prior to the assignment, transfer, and delivery of
any of the Collateral to Secured Party (or any agent designated by Secured
Party).
c. No material dispute, right to setoff, counterclaim, or
defense exists with respect to all or any part of the Collateral.
d. This Agreement constitutes the legal, valid, and binding
obligation of Debtor, enforceable against Debtor and the Collateral in
accordance with its provisions (subject to limitations as to enforceability
which might result from bankruptcy, reorganization, arrangement, insolvency, or
other similar laws affecting creditors' rights generally).
e. Debtor keeps and shall continue to keep all of his books and
records concerning the Collateral and all of his other books and records at the
address listed below, unless written notice to the contrary is given by the
Debtor to Secured Party. All books, records, and documents relating to the
Collateral are and will be genuine and in all respects what they purport to be.
4. DELIVERY AND PERFECTION. Concurrently with the execution of this
Agreement, Debtor shall execute and deliver to Secured Party a UCC-l Financing
Statement in the form and content of Schedule 2 attached hereto and
incorporated herein by this reference, and such other UCC-l Financing
Statements describing the Collateral to be filed with the office of the
Delaware Division of Corporations and with the appropriate office in such other
states as Secured Party may deem necessary or advisable. In addition, Debtor
shall execute such further documents and instruments, and do such further acts
as Secured Party may reasonably request from time to time in order to protect
and perfect its security interest in the Collateral.
5. DISPOSITION OF COLLATERAL. Debtor shall not, without Secured
Party's prior written consent, exchange, sell, transfer, further encumber or
dispose of the Collateral or any rights therein, whether by cancellation,
reissuance, or otherwise; cause or permit any compromise, adjustment,
amendment, modification, settlement, substitution, dissolution, or termination
of or in connection with the Collateral; or allow anything to be done that
might impair, or fail to do anything necessary or advisable to preserve, the
value of the Collateral and Secured Party's interest in the same.
6. FILING OF GOVERNMENT REPORTS. Debtor shall prepare and file all
schedules, reports, returns, and/or other data required by local, state, or
federal authorities with respect to taxes or other charges against the
Collateral, and pay, when due, all taxes and claims arising in connection with
the Collateral.
7. RECORDS AND REPORTS. Debtor shall allow Secured Party and its
officers, agents, attorneys, and accountants, to examine and copy any and all
of the Debtor's books, records, or other documents relating to the Collateral
at any time after reasonable notice during Debtor's business hours.
8. DEFAULT. The following shall constitute a default by Debtor
hereunder:
a. The occurrence of any default under the Senior Note;
b. Any warranty, representation, or other statement made or
furnished by Debtor hereunder is found to be untrue or false; or
c. The failure of Debtor to punctually perform and otherwise
fulfill or comply with any of its covenants, duties, obligations, and
responsibilities under this Agreement, the Senior Note, or under any other
agreement, obligation, or undertaking between Debtor and Secured Party.
9. RIGHTS AND REMEDIES. Upon default by Debtor, Secured Party shall
immediately notify Debtor in writing, which writing shall specify in detail the
nature of such default, and shall state that Debtor has failed to cure such
default within ten (10) days after written notice. On the occurrence of any
default hereunder, Secured Party shall be entitled to all rights and remedies
provided for under law. Such rights of Secured Party shall be cumulative, and
the exercise of any right by Secured Party shall not affect or impair other
rights which Secured Party may have under this Agreement or at law. In
accordance with the foregoing, and without limitation, Secured Party shall be
entitled to:
a. Take or keep possession of the Collateral and protect the
same;
b. If Secured Party is not then in possession of the
Collateral, to require Debtor or any other person in possession of the
Collateral to assemble it and make it available to Secured Party at a
reasonably convenient place, to be designated by Secured Party;
c. Retain the Collateral in full satisfaction of Debtor's
obligations or dispose of the Collateral by public or private sale and apply
the proceeds in total or partial satisfaction of Debtor's obligations to
Secured Party and for Secured Party's costs (including, without limitation,
reasonable attorneys' fees and costs) incurred in proceeding under this
paragraph.
e. Declare any or all amounts owing to Secured Party under the
Senior Note, this Agreement, or otherwise to be immediately due and payable;
Reduce any claim against Debtor to judgment and enforce any such judgment
against Debtor;
f. Take such steps as it may deem reasonably appropriate to
foreclose upon or otherwise enforce the security interest(s) and lien of this
Agreement to secure payment and performance of the Debtor's obligations under
the Senior Note and this Agreement; and
g. Exercise any and all other rights and remedies available at
law or equity or otherwise to Secured Party under this Agreement.
10. FULL PAYMENT. Upon payment in full by Debtor to Secured Party
of all amounts due and payable under the Senior Note and this Agreement Secured
Party shall have no further right or interest in or to the Collateral.
11. MISCELLANEOUS.
a. ENTIRE AGREEMENT. This Agreement fully and completely
expresses the entire agreement between the parties hereto with respect to the
subject matter hereof. There are no writings, conversations, representations,
warranties, or agreements, which the parties intend to be a part hereof except
as expressly set forth in this Agreement or to be set forth in the instruments
or other documents delivered or to be delivered hereunder. This Agreement
represents the entire agreement between the parties hereto and supersedes any
and all previous written or oral agreements or discussions between the parties
and any other person or legal entity concerning the transactions contemplated
herein.
b. REMEDIES. Each of the parties to this Agreement shall be
entitled to specifically enforce its rights under this Agreement, recover
damages by reason of any breach of any provision of this Agreement, and to
exercise all other rights existing in its favor. The parties hereto agree and
acknowledge that the assets and other matters that are the subject of this
Agreement are unique and that money damages will not be an adequate remedy for
any breach of certain of the provisions of this Agreement relating to the
assets and other matters and that any party may in its sole discretion apply to
any court of law or equity of competent jurisdiction for specific performance
and/or injunctive relief in order to enforce or prevent any violations of the
provisions of this Agreement.
c. AMENDMENTS AND WAIVERS. No change in, amendment to,
waiver, or termination of this Agreement, or any part hereof, shall be valid
unless in writing and signed by or on behalf of the party to be charged
therewith.
d. NO THIRD PARTY BENEFIT. The parties acknowledge and
agree that the provisions of this Agreement are for the sole benefit of the
parties hereto, and are not for the benefit, directly or indirectly, of any
other person or entity.
e. GOVERNING LAW. The validity of this Agreement and any of
its terms or provisions, as well as the rights and duties of the parties
hereunder, shall be interpreted and construed pursuant to and in accordance
with the laws of the State of California without regard to the conflicts of law
provisions thereof.
f. HEADINGS. Paragraph headings have been inserted in this
Agreement as a matter of convenience only; such paragraph headings are not a
part of this Agreement and shall not be used in the interpretation of this
Agreement.
g. SEVERABILITY. If any one or more of the provisions of
this Agreement are held to be invalid, illegal, or unenforceable in any respect
for any reason, the validity, legality, and enforceability of any such
provision or provisions in every other respect and of the remaining provisions
of this Agreement shall not be in any way impaired.
h. TIME OF THE ESSENCE. Time is hereby expressly made of
the essence with respect to the performance and/or satisfaction of each of the
provisions and conditions of this Agreement.
i. GENDER AND NUMBER. Wherever the context so requires,
all words used in the singular shall be construed to include the plural, and
vice versa, and words of any gender shall include any other gender.
j. NOTICES. No notice, request, demand, instruction, or
other documents to be given hereunder to any party shall be effective for any
purpose unless personally delivered to the person at the appropriate address
set forth below (in which event, such notice shall be deemed effective only
upon such delivery) or when delivered by mail, sent by registered or certified
mail, return receipt requested, as follows:
If to Debtor: ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇. ▇▇▇
▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
If to Secured Party: /Illegible/
Notice given by mail shall be deemed to have been given 48 hours after the
deposit in any United States post office box in the state to which the notice
is addressed, or 96 hours after deposit of same in any such post office box
other than in the state to which the notice is addressed, postage prepaid,
addressed as set forth above. Notice shall not be deemed given unless and
until, under the preceding sentence, notice shall be deemed given to all
addressees to whom notice must be sent. The addresses and addressees for the
purpose of this paragraph may be changed by giving written notice of such
change in the manner herein provided for giving notice.
k. SUCCESSORS AND ASSIGNS. Except as otherwise expressly
provided, this Agreement, and each of its provisions, covenants, and
conditions, shall apply to, bind, and inure to the benefit of the parties
hereto and their respective heirs, executors, administrators, legal
representatives, transferees, successors-in-interest, and assigns.
l. FURTHER ASSURANCES. Each party shall perform or cause
to be performed any further acts and execute and deliver any documents that may
be reasonably necessary or advisable to carry out the provisions of this
Agreement.
m. COUNTERPARTS. This Agreement may be executed in one or
more counterparts, all of which together shall constitute one original
document.
DEBTOR:
NatureWell, Incorporated,
a Delaware corporation
By: /S/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Senior Vice President
SECURED PARTY:
/S/ ▇▇▇▇▇ Arabia
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▇▇▇▇▇ ▇. Arabia
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SCHEDULE 1
ASSETS
All of the following properties, assets and rights of the Debtor, wherever
located, whether now owned or hereafter acquired or arising, and all proceeds
and products thereof:
All personal and fixture property of every kind and nature including, without
limitation, all furniture, fixtures, equipment, raw materials, inventory, other
goods, accounts, contract rights, rights to the payment of money, insurance
refund claims and all other insurance claims and proceeds, tort claims, chattel
paper, documents, instruments, securities and other investment property,
deposit accounts, rights to proceeds of letters of credit and all general
intangibles including, without limitation, all tax refund claims, license fees,
patents, patent applications, trademarks, trademark applications, trade names,
copyrights, copyright applications, rights to ▇▇▇ and recover for past
infringement of patents, trademarks and copyrights, computer programs, computer
software, engineering drawings, service marks, customer lists, goodwill, and
all licenses, permits, agreements of any kind or nature pursuant to which the
Debtor possesses, uses or has authority to possess or use property (whether
tangible or intangible) of others or others possess, use or have authority to
possess or use property (whether tangible or intangible) of the Debtor, and all
recorded data of any kind or nature, regardless of the medium of recording,
including, without limitation, all software, writings, plans, specifications,
formulations and schematics.
The Debtor acknowledges and agrees that, in applying the law of any
jurisdiction that at any time enacts all or substantially all of the uniform
provisions of revised Article 9 of the Uniform Commercial Code approved by the
American Law Institute and the National Conference of Commissioners on Uniform
State Laws and contained in the 1999 Official Text of the Uniform Commercial
Code ("Revised Article 9"), the foregoing collateral description covers all
assets of the Debtor.
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SCHEDULE 2
UCC-1 FINANCING STATEMENT
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