Exhibit 4.14
Security Agreement
This Security Agreement ("Agreement") is made and entered into on this 30th
day of June, 1999, by and between Winterstone Management Inc., a Texas
Corporation, ("Secured Party") and Performance Interconnect Corp., a Texas
Corporation ("Debtor"), as follows:
W I t n e s s e + h
Whereas, in order to secure the payment of the Indebtedness (as
hereinafter defined), Secured Party has required tat Debtor assign a
security interest in the collateral (as hereinafter defined) to Secured
party; and
Whereas, Debtor has deemed it to be in the best interest of Debtor to
grant a security interest in the collateral to secure the payment and
performance of the indebtedness;
Now, Therefore, for and in consideration of the premises, covenants
and agreements contained herein, and for other ▇▇▇▇ and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged
and confessed, Secured Party and Debtor agree as follows:
1. Indebtedness. The Security Interest (defined below) is herein
created to secure Debtor's Note of even date herewith, by and between
Debtor, as Maker, and Secured Party, as Payee, in the original principal
amount of $555,867.00, and any and all additions, renewals and extensions
thereof ("Indebtedness").
2. Agreement and Collateral Debtor hereby grants to Secured party a
security interest ("Security Interest") in the following property
("Collateral"), whether now owned or hereafter acquired:
All Debtor's right, title and interest in and to all of Debtor's
interest in the common stock of PC Dynamics of Texas, Inc. and PC Dynamics
Corp., together with all rights, powers and privileges thereunto
appertaining, and all proceeds thereof
3. Debtor's Warranties, Covenants and Further Agreements.
a. Title. Except for the interest granted herein, Debtor has,
or on acquisition will have, fee simple title to the collateral free
from any lien, security interest, encumbrance, or claim and Debtor
will, during the term of this Agreement, at Debtors cost, keep the
collateral free from other liens, security interests, encumbrances or
claims, and defend any action which may affect the Security Interest
or Debtor's title to the collateral.
b. Financing Statement. Debtor will join in executing all
financing statements and other instruments, documents, certificates
and agreements deemed necessary by Secured Party to evidence, create,
perfect or enforce the Security Interest and will pay all costs
thereof.
c. Assignment. Notwithstanding any other provision hereof
Debtor will not process, sell, lease, or otherwise dispose of all or
part of the collateral. Secured Party may assign or transfer all or
part of his rights in, and obligations, if any, under the
Indebtedness, to Collateral and this Agreement.
4. Rights of Debtor. Prior to the occurrence of a Default (as
hereinafter defined), Debtor may exercise any and all rights, voting and
otherwise, with respect to the Collateral. However, Debtor may not receive
any distributions and other payments made with respect to the collateral
free from the Security Interest provided for in this Agreement
5. Rights of Secured Party. Effective upon the Occurrence of a
Default, Debtor hereby appoints Secured Party as Debtor's attorney-in-fact
to do any act which Debtor is obligated by this Agreement to do, to exercise
all rights of Debtor in the collateral, voting and otherwise, to receive all
distributions made with respect to the Collateral, and to do all things
deemed necessary by Secured party to perfect the Security Interest and
preserve, collect, enforce and protect the Collateral, all at Debtors cost
and without any obligation on Secured Party so to act. Secured Party shall
not be liable for any act or omission on the part of Secured party, his
agents or employees, except willful misconduct, nor shall Secured Party be
responsible for depreciation in value of the collateral for preservation of
rights against prior parties. The foregoing rights and powers of Secured
Party may be exercised after default and shall be in addition to, and not a
limitation upon, any rights and powers of Secured Party given herein or by
law, custom, or otherwise.
6. Events Default. Debtor shall be in default ("Default") under
this Agreement upon the occurrence of a default pursuant to the terms of the
Note, and Debtor's failure to cure such default within the time periods set
faith in the Note.
7. Remedies of Secured Party Upon Default. When a Default occurs,
and except as may be otherwise provided in the Note, Secured Party may
declare all or a part of the Indebtedness immediately due and payable
without demand, notice of default, notice of intent to demand, notice of
intent to accelerate maturity, or notice of acceleration of maturity, and
may proceed to enforce payment of seine and to exercise any and all of the
rights and remedies provided by Article 9 of the Texas Business and Commerce
Code ("Code") as well as all other rights and remedies possessed by Secured
Party under this Agreement or otherwise at law or inequity. For purposes of
the notice requirements of the Code, Secured Party and Debtor agree tat
notice given at least ten (10) calendar days prior to the related action
hereunder is reasonable. Secured Party shall be entitled to immediate
possession of the collateral and all books and records evidencing same and
shall have authority to enter upon any premises upon which said items maybe
situated and removed same therefrom. Expenses of retaking, holding,
preparing for sale, selling or the like, shall include without limitation,
Secured Party's reasonable attorney's fees and all such expenses shall be
recovered by Secured Party before applying the proceeds from the disposition
of the collateral toward the Indebtedness. To the extent allowed by the
Code, Secured Party may use his discretion in applying the proceeds of any
disposition of the collateral. All rights and remedies of Secured Party
hereunder are cumulative and may be exercised singly or concurrently. The
exercise of any right or remedy will not be a waiver of any other.
8. General
a. Exhaustion of Remedies. Secured Party shall not be required
to first foreclose, proceed against, exhaust any other collateral or
security for any Indebtedness or obligation of Debtor hereby secured
before pursuing any of its rights pursuant to this Agreement. Suite
may be brought to recover other collateral at the election of Secured
Party, without joinder of Debtor.
b. - Release of Co11a+eral. Secured Party may surrender,
release, exchange or alter any collateral or security for the
lndebt4edness hereby secured without effecting the Security Interest
created by this Agreement, and this Agreement shall continue effective
notwithstanding any legal disability of Debtor to incur any
indebtedness or obligation incurred to Secured Party.
c. Waiver of Secured Party. No waiver by Secured Party of any
right hereunder or of any default by Debtor shall be binding upon
Secured Party unless in writing. Failure or delay by Secured Party to
exercise any right hereunder or waiver of any default shall not
operate as a waiver of any other right, or further exercise of such
right, or of any further default.
d. Parties Bound. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective heirs,
executors, administrators, legal representatives, successors,
receivers, trustees and assigns where permitted by this Agreement
e. Notice shall be given or sent when mailed postage prepaid to
Debtor's address given above or to Debtor's most recent address as
shown by notice of change on file with Secured Party.
f. Modifications. This Agreement shall not be amended in any
way except by a written agreement signed by the parties hereto.
g. Severability. The unenforceability of any provision of this
Agreement shall not affect the enforceability of validity of any other
provision hereof.
h. Construction. The captions herein are for convenience of
reference only and not for definition or interpretation.
i. Ambiguity. In event it shall be determined that there is
any ambiguity contained herein, said ambiguity shall not be construed
against either party hereto as a result of such party's preparation
of this Agreement, but shall be interpreted in favor or against either
of the parties hereto in light of all the facts, circumstances and the
intentions of the parties at the time of their executive of this
Agreement.
j. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Texas.
Secured Party:
Winterstone Management Inc.
By: /s/
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D. ▇▇▇▇▇▇ ▇▇▇▇▇, President
Debtor:
Performance Interconnect Corp.
By: /s/
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▇▇ ▇▇▇▇▇▇▇▇, President