AMENDMENT NO. 2 TO
GENERAL SECURITY AGREEMENT
AMENDMENT NO. 2 dated as of March 31, 2000 (this "Amendment") to
GENERAL SECURITY AGREEMENT, dated as of July 29, 1998 (the "Agreement"), as
amended by AMENDMENT NO. 1 TO GENERAL SECURITY AGREEMENT, dated as of January
18, 2000 ("Amendment No. 1"), by and between PICK COMMUNICATIONS CORP., a Nevada
corporation ("Debtor"), and COMMONWEALTH ASSOCIATES, a New York limited
partnership, as agent ((the "Agent") for the investors (the "Investors") from
time to time (the Agent, acting in such capacity, the "Secured Party.") Terms
with initial capital letters used herein without definition shall have the
meanings set forth in the Agreement.
WHEREAS, the Debtor has requested that the Secured Party allow it to
relocate certain inventory and equipment collateral listed on Schedule 1
attached hereto from the location listed on Schedule 1 to the Agreement; and
WHEREAS, the Secured Party has agreed to Debtor's request and is
willing to amend the Agreement subject to the terms and conditions contained
herein.
NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Debtor, the Agent and the Investors agree as follows:
ARTICLE I
Definitions
Section 1.01 Definitions. Capitalized terms used in this Amendment, to
the extent not otherwise defined herein, shall have the same meanings as in the
Agreement, as amended hereby.
ARTICLE II
Amendments
Section 2.01. Amendment to Section 1 of the Agreement. Section 1 of the
Agreement, effective as of the date hereof, is amended as follows:
(a) The following definition is hereby amended and restated as
follows:
"Collateral" means, except for the property and contracts
listed on Schedule 1 to Amendment No. 1, all of the Debtor's right, title and
interest in and under or arising out of each and all of the following:
All personal property and fixtures of the Debtor of
any type or description, wherever located and now existing or
hereafter arising or acquired, including but not limited to
the following:
(i) all of the Debtor's goods including, without
limitation:
(a) all inventory, including without
limitation, equipment held for lease,
whether raw materials, in process or
finished, all material or equipment usable
in processing the same and all documents of
title covering any inventory (all of the
foregoing, "Inventory"), including without
limitation, that located at the location
listed on Schedule I annexed to the
Agreement, and listed on Schedule 1 attached
hereto and located at ▇▇▇▇ ▇.▇. ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇, ▇▇ ▇▇▇▇▇;
(b) all equipment (the "Equipment") employed
in connection with the Debtor's business,
together with a present and future
additions, attachments and accessions
thereto and all substitutions therefor and
replacements thereof, including without
limitation that located at the locations
listed on Schedule I annexed to the
Agreement, and listed on Schedule 1 attached
hereto and located at ▇▇▇▇ ▇.▇. ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇, ▇▇ ▇▇▇▇▇;
(ii) all of the Debtor's present and future
accounts, accounts receivable, general
intangibles, contracts and contract rights
(herein sometimes referred to as
"Receivables"), including but not limited to
the Debtor's rights (including rights to
payment) under all Assigned Agreements,
together with
(a) all claims, rights, powers or privileges
and remedies of the Debtor relating thereto
or arising in connection therewith
including, without limitation, all rights of
the Debtor to make determinations, to
exercise any election (including, but not
limited to, election of remedies) or option
or to give or receive any notice, consent,
waiver or approval, together with full power
and authority to demand, receive, enforce,
collect or receipt for any of the foregoing
or any property which is the subject of the
Assigned Agreements, to enforce or execute
any checks, or other instruments or orders,
to file any claims and to take any action
which (in the opinion of the Secured Party)
may be necessary or advisable in connection
with any of the foregoing,
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(b) all liens, security, guaranties,
endorsements, warranties and indemnities and
all insurance and claims for insurance
relating thereto or arising in connection
therewith,
(c) all rights to property forming the
subject matter of the Receivables including,
without limitation, rights to stoppage in
transit and rights to returned or
repossessed property,
(d) all writings relating thereto or arising
in connection therewith including without
limitation, all notes, contracts, security
agreements, guaranties, chattel paper and
other evidence of indebtedness or security,
all powers-of-attorney, all books, records,
ledger cards and invoices, all credit
information, reports or memoranda and all
evidence of filings or registrations
relating thereto,
(e) all catalogs, computer and automatic
machinery software and programs, and the
like pertaining to operations by the Debtor
in, on or about any of its plants or
warehouses, all sales data and other
information relating to sales or service of
products now or hereafter manufactured on or
about any of its plants, and all accounting
information pertaining to operations in, on
or about any of its plants, and all media in
which or on which any of the information or
knowledge or data is stored or contained,
and all computer programs used for the
compilation or printout of such information,
knowledge, records or data, and
(f) all accounts, contract rights, general
intangibles and other property rights of any
nature whatsoever arising out of or in
connection with the foregoing, including
without limitation, payments due and to
become due, whether as repayments,
reimbursements, contractual obligations,
indemnities, damages or otherwise;
(iii) all other personal property of the
Debtor of any nature whatsoever, including,
without limitation, all accounts, bank
accounts, deposits, credit balances,
contract rights, inventory, general
intangibles, goods, equipment, instruments,
chattel paper, machinery, furniture,
furnishings, fixtures, tools, supplies,
appliances, plans and drawings, together
with all customer and supplier fists and
records of the business, and all property
from time to time described in any financing
statement (UCC-1) signed by the Debtor
naming the Agent as secured party; and
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(iv) all additions, accessions, replacements,
substitutions or improvements and all
products and proceeds including, without
limitation, proceeds of insurance, of any
and all of the Collateral described in
clauses (i) through (iii) above.
ARTICLE III
Ratifications, Representations, Warranties and Covenant
Section 3.01. Ratifications. The terms and provisions set forth in this
Amendment shall modify and supersede all inconsistent terms and provisions set
forth in the Agreement and, except as expressly modified and superseded by this
Amendment, the terms and provisions of the Agreement, including, without
limitation, all financial covenants contained therein, are ratified and
confirmed and shall continue in full force and effect. Agent, Debtor and
Investors agree that the Agreement as amended hereby shall continue to be legal,
valid, binding and enforceable in accordance with its terms.
Section 3.02. Representations and Warranties. The Debtor hereby
represents and warrants to Agent and Investors that the execution, delivery and
performance of this Amendment and all other loan, amendment or security
documents to which Debtor is or is to be a party hereunder (hereinafter referred
to collectively as the "Loan Documents") executed and/or delivered in connection
herewith, have been authorized by all requisite corporate action on the part of
Debtor and will not violate the Articles of Incorporation or Bylaws of Debtor.
ARTICLE IV
Conditions Precedent
Section 4.01. Conditions. The effectiveness of this Amendment is
subject to the satisfaction of the following conditions precedent (unless
specifically waived in writing by the Secured Party):
(a) Agent shall have received all of the following, each dated
(unless otherwise indicated) as of the date of this Amendment, in form
and substance satisfactory to Agent in its sole discretion:
(i) Company Certificate. A certificate executed by
the Secretary or Assistant Secretary of Debtor certifying (A)
that Debtor's Board of Directors has adopted, approved,
consented to and ratified the resolutions attached thereto
which authorize the execution, delivery and performance by
Debtor of the Amendment and the Loan Documents and (B) that
except as certified and attached thereto, neither the Articles
of Incorporation nor Bylaws of Debtor have been amended since
the date of the Agreement;
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(ii) Other Documents. Debtor shall have executed and
delivered such other documents and instruments as Agent may require.
(b) All corporate proceedings taken in connection with the
transactions contemplated by this Amendment and all documents,
instruments and other legal matters incident thereto shall be
satisfactory to the Secured Party and their legal counsel.
ARTICLE V
Miscellaneous
Section 5.01. Survival of Representations and Warranties. All
representations and warranties made in the Agreement or any other document or
documents relating thereto, including, without limitation, any Loan Document
furnished in connection with this Amendment, shall survive the execution and
delivery of this Amendment and the other Loan Documents, and no investigation by
Agent or any Investor or any closing shall affect the representations and
warranties or the right of Agent and each Investor to rely thereon.
Section 5.02. Reference to Agreement. The Agreement, each of the Loan
Documents, and any and all other agreements, documents or instruments now or
hereafter executed and delivered pursuant to the terms hereof or pursuant to the
terms of the Agreement as amended hereby, are hereby amended so that any
reference therein to the Agreement shall mean a reference to the Agreement as
amended hereby.
Section 5.03. Severability. Any provision of this Amendment held by a
court of competent jurisdiction to be invalid or unenforceable shall not impair
or invalidate the remainder of this Amendment and the effect thereof shall be
confined to the provision so held to be invalid or unenforceable.
Section 5.04. APPLICABLE LAW. THIS AMENDMENT AND ALL OTHER LOAN
DOCUMENTS EXECUTED PURSUANT HERETO SHALL BE DEEMED TO HAVE BEEN MADE AND TO BE
PERFORMABLE IN THE STATE OF NEW YORK AND SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK
Section 5.05. Successors and Assigns. This Amendment is binding upon
and shall inure to the benefit of Agent, Investors and Debtor and their
respective successors and assigns; provided, however, that Debtor may not assign
or transfer any of its rights or obligations hereunder without the prior written
consent of Agent. Agent and each Investor may assign any or all of their rights
or obligations hereunder without the prior consent of any Debtor.
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Section 5.06. Counterparts. This Amendment maybe executed in one or
more counterparts, each of which when so executed shall be deemed to be an
original, but all of which when taken together shall constitute one and the same
instrument.
Section 5.07. Effect of Waiver. No consent or waiver, express or
implied, by Agent or any Investor to or of any breach of or deviation from any
covenant or condition of the Agreement or duty shall be deemed a consent or
waiver to or of any other breach of or deviation from the same or any other
covenant, condition or duty. No failure on the part of Agent or any Investor to
exercise and no delay in exercising, and no course of dealing with respect to,
any right, power, or privilege under this Amendment, the Agreement or any other
Loan Document shall operate as a waiver thereof, nor shall any single or partial
exercise of any right, power, or privilege under this Amendment, the Agreement
or any other Loan Document preclude any other or further exercise thereof or the
exercise of any other right, power, or privilege. The rights and remedies
provided for in the Agreement and the other Loan Documents are cumulative and
not exclusive of any rights and remedies provided by law.
Section 5.08. Headings. The headings, captions and arrangements used in
this Amendment are for convenience only and shall not affect the interpretation
of this Amendment.
Section 5.09. NO ORAL AGREEMENTS. THIS AMENDMENT, TOGETHER WITH THE
OTHER LOAN DOCUMENTS AS WRITTEN, REPRESENT THE FINAL AGREEMENTS BETWEEN- AGENT,
THE LENDERS AND BORROWERS AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO
UNWRITTEN ORAL AGREEMENTS BETWEEN AGENT, THE LENDERS AND BORROWERS.
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IN WITNESS WHEREOF, the parties have entered into this Agreement on the
date first above written.
PICK COMMUNICATIONS CORP, as Debtor
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Interim Chief Executive Officer
COMMONWEALTH ASSOCIATES, as Agent,
as Secured Party
By: COMMONWEALTH MANAGEMENT CO.,
INC., its General Partner
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: General Counsel
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