Exhibit 10.30

 

[PORTIONS OF THIS EXHIBIT HAVE BEEN REDACTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.]

 

 WELLS FARGO

 

SECURITY AGREEMENT
SPECIFIC RIGHTS TO PAYMENT

 

 

1.                                       GRANT OF SECURITY INTEREST. For
valuable consideration, the undersigned EVANS & SUTHERLAND COMPUTER CORPORATION,
or any of them (“Debtor”), hereby grants and transfers to WELLS FARGO BANK
NATIONAL ASSOCIATION (“Bank”) a security interest in the following accounts,
deposit accounts, chattel paper (whether electronic or tangible), Instruments,
promissory notes, documents, general intangibles, payment intangibles, software.
letter of credit rights, health-care insurance receivables and other rights to
payment (collectively called “Collateral”):

 

Account No. XXXXXX issued by or maintained with Bank, however evidenced, and all
monies, now or hereafter deposited therein and due or to become due and payable
thereon, and all instruments, documents, claims and rights to payment with
respect thereto, and replacements, substitutions and renewals thereof,

 

and all renewals thereof, including all securities, guaranties, warranties,
indemnity agreements, insurance policies, supporting obligations and other
agreements pertaining to the same or the property described therein, together
with whatever Is receivable or received when any of the Collateral or proceeds
thereof are sold, collected, exchanged or otherwise disposed of, whether such
disposition is voluntary or involuntary, including without limitation,- all
rights to payment, including returned premiums, with respect to any insurance
relating to any of the foregoing, and all rights to payment with respect to any
claim or cause of action affecting or relating to any of the foregoing
(hereinafter called “Proceeds”).

 

2.                                       OBLIGATIONS SECURED. The obligations
secured hereby are the payment and performance of: (a) all present and future
Indebtedness of Debtor to Bank; (b) all obligations of Debtor and rights of Bank
under this Agreement; and (c) all present and future obligations of Debtor to
Bank of other kinds. The word “Indebtedness” is used herein in its most
comprehensive sense and includes any and all advances, debts, obligations and
liabilities of Debtor, or any of them, heretofore, now or hereafter made,
incurred or created, whether voluntary or involuntary and however arising,
whether due or not due, absolute or contingent, liquidated or unliquidated,
determined or undetermined, and whether Debtor may be liable individually or
jointly, or whether recovery upon such Indebtedness may be or hereafter becomes
unenforceable.

 

3.                                       TERMINATION. This Agreement will
terminate upon the performance of all obligations of Debtor to Bank, including
without limitation, the payment of all Indebtedness of Debtor to Bank, and the
termination of all commitments of Bank to extend credit to Debtor, existing at
the time Bank receives written notice from Debtor of the termination of this
Agreement.

 

4.                                       OBLIGATIONS OF BANK. Bank has no
obligation to make any loans hereunder. Any money received by Bank in respect of
the Collateral may be deposited, at Bank’s option, into a non-interest bearing
account over which Debtor shall have no control, and the same shall, for all
purposes, be deemed Collateral hereunder.

 

5.                                       REPRESENTATIONS AND WARRANTIES. Debtor
represents and warrants to Bank that: (a) Debtor’s legal name is exactly as set
forth on the first page of this Agreement, and all of Debtor’s organizational
documents or agreements delivered to Bank are complete and accurate in every
respect; (b) Debtor is the owner and has possession or control of the Collateral
and Proceeds; (c) Debtor has the exclusive right to grant a security interest in
the Collateral and Proceeds; (d) all Collateral and Proceeds are genuine, free
from liens, adverse claims, setoffs, default, prepayment, defenses and
conditions precedent of any kind or character, except the lien created hereby or
as otherwise agreed to by Bank, or heretofore disclosed by Debtor to Bank, in
writing; (e) all statements contained herein and, where applicable, in the
Collateral are true and complete in all material respects; (f) no financing
statement covering any of the Collateral or Proceeds, and naming any secured
party other than Bank, is on file in any public office; (g) all persons
appearing to be obligated on Collateral and Proceeds have authority and capacity
to contract and are bound as they appear to be; (h) all property subject to
chattel paper has been properly registered and filed in compliance with law and
to perfect the interest of Debtor

 

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[XXXXX – REDACTED PURSUANT TO REQUEST FOR CONFIDENTIAL TREATMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION.]

 

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in such property; and (i) all Collateral and Proceeds comply with all applicable
laws concerning form, content and manner of preparation and execution, Including
where applicable Federal Reserve Regulation Z and any State consumer credit
laws.

 

6.                                       COVENANTS OF DEBTOR.

 

6.1                                 Debtor Agrees in general: (a) to pay
Indebtedness secured hereby when due; (b) to indemnify Bank against all losses,
claims, demands, liabilities and expenses of every kind caused by property
subject hereto; (c) to pay all costs and expenses, including reasonable
attorneys’ fees, incurred by Bank in the perfection and preservation of the
Collateral or Bank’s interest therein and/or the realization, enforcement and
exercise of Bank’s rights, powers and remedies hereunder, (d) to permit Bank to
exercise its powers; (e) to execute and deliver such documents as Bank deems
necessary to create, perfect and continue the security interests contemplated
hereby; (f) not to change its name, and as applicable, its chief executive
office, its principal residence or the jurisdiction in which it is organized
and/or registered without giving Bank prior written notice thereof; (g) not to
change the places where Debtor keeps any Collateral or Debtors records
concerning the Collateral and Proceeds without giving Bank prior written notice
of the address to which Debtor is moving same; and (h) to cooperate with Bank in
perfecting all security interests granted herein and in obtaining such
agreements from third parties as Bank deems necessary, proper or convenient in
connection with the preservation, perfection or enforcement of any of Its rights
hereunder.

 

6.2                                 Debtor agrees with regard to the Collateral
and Proceeds, unless Bank agrees otherwise in writing: (a) that Bank is
authorized to file financing statements in the name of Debtor to perfect Bank’s
security interest in Collateral and Proceeds; (b) where applicable, to insure
the Collateral with Bank named as loss payee, in form, substance and amounts,
under agreements, against risks and liabilities, and with insurance companies
satisfactory to Bank; (c) not to permit any security interest in or lien on the
Collateral or Proceeds, except in favor of Bank; (d) not to sell, hypothecate or
otherwise dispose of, nor permit the transfer by operation of law of, any of the
Collateral or Proceeds or any interest therein, nor withdraw any funds from any
deposit account pledged to Bank hereunder; (e) to keep, in accordance with
generally accepted accounting principles, complete and accurate records
regarding all Collateral and Proceeds, and to permit Bank to inspect the same
and make copies thereof at any reasonable time; (f) if requested by Bank, to
receive and use reasonable diligence to collect Proceeds, in trust and as the
property of Bank, and to immediately endorse as appropriate and deliver such
Proceeds to Bank daily in the exact form in which they are received together
with a collection report in form satisfactory to Bank; (g) not to commingle
Collateral or Proceeds, or collections thereunder, with other property; (h) in
the event Bank elects to receive payments of Collateral or Proceeds hereunder,
to pay all expenses incurred by Bank in connection therewith, including expenses
of accounting, correspondence, collection efforts, reporting to account or
contract debtors, filing, recording, record keeping and expenses incidental
thereto; and (i) to provide any service and do any other acts which may be
necessary to keep all Collateral and Proceeds free and clear of all defenses,
rights of offset and counterclaims.

 

7.                                       POWERS OF BANK. Debtor appoints Bank
its true attorney-in-fact to perform any of the following powers, which are
coupled with an interest, are irrevocable until termination of this Agreement
and may be exercised from time to time by Bank’s officers and employees, or any
of them, whether or not Debtor is in default: (a) to perform any obligation of
Debtor hereunder in Debtors name or otherwise; (b) to give notice to account
debtors or others of Bank’s rights in the Collateral and Proceeds, to enforce or
forebear from enforcing the same and make extension or modification agreements
with respect thereto; (c) to release persons liable on Collateral or Proceeds
and to give receipts and acquittances and compromise disputes in connection
therewith; (d) to release or substitute security; (e) to resort to security in
any order; (f) to prepare, execute, file, record or deliver notes, assignments,
schedules, designation statements, financing statements, continuation
statements, termination statements, statements of assignment, applications for
registration or like papers to perfect, preserve or release Bank’s interest in
the Collateral and Proceeds; (g) to receive, open and read mail addressed to
Debtor, (h) to take cash, instruments for the payment of money and other
property to which Bank is entitled; 0) to verify facts concerning the Collateral
and Proceeds by inquiry of obligors thereon, or otherwise, in its own name or a
fictitious name; (j) to endorse, collect, deliver and receive payment under
instruments for the payment of money constituting or relating to Proceeds; (k)
to prepare, adjust, execute, deliver and receive payment under insurance

 

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claims, and to collect and receive payment of and endorse any instrument in
payment of loss or returned premiums or any other insurance refund or return,
and to apply such amounts received by Bank, at Bank’s sole option, toward
repayment of the Indebtedness; (I) to exercise all rights, powers and remedies
which Debtor would have, but for this Agreement, with respect to all Collateral
and Proceeds subject hereto; (m) to make withdrawals from and to close deposit
accounts or other accounts with any financial institution, wherever located,
into which Proceeds may have been deposited, and to apply funds so withdrawn to
payment of the Indebtedness; (n) to preserve or release the interest evidenced
by chattel paper to which Bank is entitled hereunder and to endorse and deliver
any evidence of title incidental thereto; and (o) to do all acts and things and
execute all documents in the name of Debtor or otherwise, deemed by Bank as
necessary, proper and convenient in connection with the preservation, perfection
or enforcement of its rights hereunder.

 

8.                                       PAYMENT OF PREMIUMS, TAXES, CHARGES,
LIENS AND ASSESSMENTS. Debtor agrees to pay, prior to delinquency, all insurance
premiums, taxes, charges, liens and assessments against the Collateral and
Proceeds, and upon the failure of Debtor to do so, Bank at its option may pay
any of them and shall be the sole judge of the legality or validity thereof and
the amount necessary to discharge the same. Any such payments made by Bank shall
be obligations of Debtor to Bank, due and payable immediately upon demand,
together with interest at a rate determined in accordance with the provisions of
this Agreement, and shall be secured by the Collateral and Proceeds, subject to
all terms and conditions of this Agreement.

 

9.                                       EVENTS OF DEFAULT. The occurrence of
any of the following shall constitute an “Event of Default” under this Agreement
(a) any default in the payment or performance of any obligation, or any defined
event of default, under (i) any contract or instrument evidencing any
Indebtedness, or (ii) any other agreement between Debtor and Bank, including
without limitation any loan agreement, relating to or executed in connection
with any Indebtedness; (b) any representation or warranty made by Debtor herein
shall prove to be incorrect, false or misleading in any material respect when
made; (c) Debtor shall fail to observe or perform any obligation or agreement
contained herein; (d) any impairment of the rights of Bank in any Collateral or
Proceeds or any attachment or like levy on any property of Debtor; and (e) Bank,
in good faith, believes any or all of the Collateral and/or Proceeds to be in
danger of misuse, dissipation, commingling, loss, theft, damage or destruction,
or otherwise in jeopardy or unsatisfactory In character or value.

 

10.                                 REMEDIES. Upon the occurrence of any Event
of Default, Bank shall have the right to declare immediately due and payable all
or any Indebtedness secured hereby and to terminate any commitments to make
loans or otherwise extend credit to Debtor. Bank shall have all other rights,
powers, privileges and remedies granted to a secured party upon default under
the Utah Uniform Commercial Code or otherwise provided by law; including without
limitation, the right (a) to contact all persons obligated to Debtor on any
Collateral or Proceeds and to instruct such persons to deliver all Collateral
and/or Proceeds directly to Bank, and (b) to sell, lease, license or otherwise
dispose of any or all Collateral. All rights, powers, privileges and remedies of
Bank shall be cumulative. No delay, failure or discontinuance of Bank in
exercising any right, power, privilege or remedy hereunder shall effect or
operate as a waiver of such right power, privilege or remedy; nor shall any
single or partial exercise of any such right, power, privilege or remedy
preclude, waive or otherwise affect any other or further exercise thereof or the
exercise of any other right, power, privilege or remedy. Any waiver, permit,
consent or approval of any kind by Bank of any default hereunder, or any such
waiver of any provisions or conditions hereof, must be in writing and shall be
effective only to the extent set forth in writing. It is agreed that public or
private sales or other dispositions, for cash or on credit, to a wholesaler or
retailer or investor, or user of property of the types subject to this
Agreement, or public auctions, are all commercially reasonable since differences
in the prices generally realized in the different kinds of dispositions are
ordinarily offset by the differences in the costs and credit risks of such
dispositions.

 

While an Event of Default exists: (a) Debtor will deliver to Bank from time to
time, as requested by Bank, current lists of all Collateral and Proceeds; (b)
Debtor will not dispose of any Collateral or Proceeds except on terms approved
by Bank; (c) Bank may, at any time and at Bank’s sole option, liquidate any time
deposits pledged to Bank hereunder and apply the Proceeds thereof to payment of
the Indebtedness, whether or not said time deposits have matured and
notwithstanding the fact that such liquidation may give rise to penalties for
early withdrawal of funds; and (d) at Bank’s request, Debtor will assemble and
deliver all Collateral and Proceeds, and

 

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books and records pertaining thereto, to Bank at a reasonably convenient place
designated by Bank. Debtor further agrees that Bank shall have no obligation to
process or prepare any Collateral for sale or other disposition.

 

11.                                 DISPOSITION OF COLLATERAL AND PROCEEDS;
TRANSFER OF INDEBTEDNESS. In disposing of Collateral hereunder, Bank may
disclaim all warranties of title, possession, quiet enjoyment and the like. Any
proceeds of any disposition of any Collateral or Proceeds, or any part thereof,
may be applied by Bank to the payment of expenses incurred by Bank in connection
with the foregoing, including reasonable attorneys’ fees, and the balance of
such proceeds may be applied by Bank toward the payment of the Indebtedness in
such order of application as Bank may from time to time elect. Upon the transfer
of all or any part of the Indebtedness, Bank may transfer all or any part of the
Collateral or Proceeds and shall be fully discharged thereafter from all
liability and responsibility with respect to any of the foregoing so
transferred, and the transferee shall be vested with all rights and powers of
Bank hereunder with respect to any of the foregoing so transferred; but with
respect to any Collateral or Proceeds not so transferred Bank shall retain all
rights, powers, privileges and remedies herein given.

 

12.                                 STATUTE OF LIMITATIONS. Until all
Indebtedness shall have been paid in full and all commitments by Bank to extend
credit to Debtor have been terminated, the power of sale or other disposition
and all other rights, powers, privileges and remedies granted to Bank hereunder
shall continue to exist and may be. exercised by Bank at any time and from time
to time irrespective of the fact that the Indebtedness or any part thereof may
have become barred by any statute of limitations, or that the personal liability
of Debtor may have ceased, unless such liability shall have ceased due to the
payment in full of all Indebtedness secured hereunder.

 

13.                                 MISCELLANEOUS. When there is more than one
Debtor named herein: (a) the word “Debtor” shall mean all or any one or more of
them as the context requires; (b) the obligations of each Debtor hereunder are
joint and several; and (c) until all Indebtedness shall have been paid in full,
no Debtor shall have any right of subrogation or contribution, and each Debtor
hereby waives any benefit of or right to participate in any of the Collateral or
Proceeds or any other security now or hereafter held by Bank. Debtor hereby
waives any right to require Bank to (I) proceed against Debtor or any other
person, (ii) proceed against or exhaust any security from Debtor or any other
person, (iii) perform any obligation of Debtor with respect to any Collateral or
Proceeds, and (d) make any presentment or demand, or give any notice of
nonpayment or nonperformance, protest, notice of protest or notice of dishonor
hereunder or in connection with any Collateral or Proceeds. Debtor further
waives any right to direct the application of payments or security for any
Indebtedness of Debtor or indebtedness of customers of Debtor.

 

14.                                 NOTICES. All notices, requests and demands
required under this Agreement must be in writing, addressed to Bank at the
address specified in any other loan documents entered into between Debtor and
Bank and to Debtor at the address of its chief executive office (or principal
residence, if applicable) specified below or to such other address as any party
may designate by written notice to each other party, and shall be deemed to have
been given or made as follows: (a) if personally delivered, upon delivery; (b)
if sent by mail, upon the earlier of the date of receipt or 3 days after deposit
in the U. S. mail, first class and postage prepaid; and (c) if sent by telecopy,
upon receipt.

 

15.                                 COSTS, EXPENSES AND ATTORNEYS’ FEES. Debtor
shall pay to Bank immediately upon demand the full amount of all payments,
advances, charges, costs and expenses, including reasonable attorneys’ fees (to
include outside counsel fees and all allocated costs of Bank’s in-house
counsel), expended or incurred by Bank In exercising any right, power, privilege
or remedy conferred by this Agreement or in the enforcement thereof, whether
incurred at the trial or appellate level, in an arbitration proceeding or
otherwise, and including any of the foregoing incurred in connection with any
bankruptcy proceeding (including without limitation, any adversary proceeding,
contested matter or motion brought by Bank or any other person) relating to
Debtor or in any way affecting any of the Collateral or Bank’s ability to
exercise any of its rights or remedies with respect thereto. All of the
foregoing shall be paid by Debtor with interest from the date of demand until
paid in full at a rate per annum equal to the greater of ten percent (10%) or
Bank’s Prime Rate in effect from time to time.

 

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16.                                 SUCCESSORS; ASSIGNS; AMENDMENT. This
Agreement shall be binding upon and inure to the benefit of the heirs,
executors, administrators, legal representatives, successors and assigns of the
parties, and may be emended or modified only in writing signed by Bank and
Debtor.

 

17.                                 OBLIGATIONS OF MARRIED PERSONS. Any married
person who signs this Agreement as Debtor hereby expressly agrees that recourse
may be had against his or her separate property for all his or her Indebtedness
to Bank secured by the Collateral and Proceeds under this Agreement.

 

18.                                 SEVERABILITY OF PROVISIONS. If any provision
of this Agreement shall be held to be prohibited by or Invalid under applicable
law, such provision shall be ineffective only to the extent of such prohibition
or invalidity, without invalidating the remainder of such provision or any
remaining provisions of this Agreement.

 

19.                                 GOVERNING LAW. This Agreement shall be
governed by and construed in accordance with the laws of the State of Utah.

 

Debtor warrants that Debtor is an organization registered under the laws of the
State of Utah.

 

Debtor warrants that its chief executive office (or principal residence, if
applicable) is located at the following address: 600 Komas Drive P.O. Box 58700,
Salt Lake City, UT 84108

 

IN WITNESS WHEREOF, this Agreement has been duly executed as of December 1,
2004.

 

EVANS & SUTHERLAND COMPUTER CORPORATION

 

By:

/s/ Kevin A. Paprzycki

 

 

Kevin A. Paprzycki

 

CFO/Secretary

 

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