EXHIBIT 10.25

THIRD AMENDED AND RESTATED GENERAL SECURITY AGREEMENT
 
THIS THIRD AMENDED AND RESTATED GENERAL SECURITY AGREEMENT dated as of February
28, 2007 (this "Agreement"), between Simclar, Inc., a Florida corporation
("Simclar"), Simclar (Mexico) Inc, a Illinois corporation ("Simclar - Mexico"),
Simclar Interconnect Technologies, Inc. ("SIT"), a Delaware corporation, Simclar
(North America), a North Carolina corporation (“Simclar NA”), Simclar De Mexico,
S.A. de C.V., an entity organized under the laws of Mexico ("Simclar SA")
(Simclar SA, SIT, Simclar, Simclar NA and Simclar - Mexico shall be individually
known as a "Grantor" and collectively as the "Grantors"), and The Governor and
Company of the Bank of Scotland (the "Lender") of the Facility Letter in respect
of a $5,650,000 term loan originally dated October 2, 2001, as amended on
January 17, 2003, July 1, 2003, October 14, 2004 and December 21, 2005, between
Lender and Simclar (the "Term Loan Facility Letter"), the Facility Letter in
respect of $7,500,000 working capital facilities originally dated October 2,
2001, as amended on July 25, 2002, November 10, 2003, October 14, 2004, December
21, 2005 and January 26, 2007 between Lender and Simclar (the "Working Capital
Facilities Letter") and the Facility Letter in respect of $1,000,000 additional
working capital facilities dated December 21, 2005, as amended on January 26,
2007, between Lender, Simclar and SIT (the “Additional Working Capital
Facilities Letter,” and together with the Term Loan Facility Letter and the
Working Capital Facilities Letter, the "Facilities Letters") and for and on
behalf of each person or other entity which is now or hereafter a Security
Beneficiary (as such term is defined below).
 
As an express condition of Lender agreeing to make additional loans to Simclar
and SIT, the Lender required, inter alia, that Grantors provide additional
security for the performance of all of the obligations under the Loan Documents,
which security Simclar agreed to provide in accordance with the terms of that
certain Second Amended and Restated General Security Agreement dated as of
February 23, 2006, between Simclar, Lender and the other parties named therein
(the "Original Security Agreement"); and
 
Grantors desire to amend and restate the terms of the Original General Security
Agreement in order to, inter alia, provide additional collateral to the Lender
in order to induce Lender to fund the additional amounts under the Facilities
Letters, and Lender is amenable to such amendment and restatement in accordance
with the terms set forth herein; and
 
Each Grantor acknowledges that it has benefited from the loans already extended
by the Lender to Simclar pursuant to the terms of the Loan Documents, and that
is willing to derive further benefit from the funding by Lender; and
 
It is a condition precedent to the obligation of Lender agreeing to make
available to Simclar the facilities under the Facilities Letters (and the
execution of any amendment thereto) that Grantors shall have executed and
delivered this Agreement to the Lender for the benefit of the Security
Beneficiaries.

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Accordingly, the Grantors and the Lender, for the benefit of each of the
Security Beneficiaries, hereby agree as follows:
 
1.    DEFINITIONS
 
Capitalized terms used in this Agreement but not defined herein shall have the
meanings given to such terms in the Facilities Letters. As used herein, the
following terms shall have the following meanings:
 
"Accounts" means, with respect to each Grantor, all "accounts" (as defined in
the UCC), including health-care-insurance receivables and Supporting
Obligations, now owned or hereafter acquired by such Grantor and shall also mean
and include all accounts receivable, contract rights, book debts, Facilities
Letters, drafts and other obligations or indebtedness owing to such Grantor
arising from the sale, lease or exchange of goods or other property by it and/or
the performance of services by it (including any such obligation which might be
characterized as an account, contract right or General Intangible under the UCC
in effect in any jurisdiction) and all of such Grantor's rights in, to and under
all purchase orders for goods, services or other property, and all of such
Grantor'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 such Grantor 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 such
Grantor), in cash case whether now in existence or hereafter arising or acquired
including the right to receive the proceeds of such purchase orders and
contracts and all collateral security and guarantees of any kind given by any
Person with respect to any of the foregoing.
 
"Chattel Paper" has the meaning set forth in the UCC (whether tangible or
electronic).
 
"Collateral" means (a) with respect to any Grantor, all of the following types
and categories of personal property, wherever located, in which such Grantor now
has or hereafter acquires any right or interest: all Accounts, Chattel Paper,
Commercial Tort Claims identified on Annex V hereto (including any supplement to
such Annex), Contracts, Deposit Accounts, Documents, Fixtures, General
Intangibles, Goods (including Inventory, Equipment and any accessions thereto),
Instruments, Intellectual Property, Investment Property, Pledged Deposits,
Receivables, special collateral accounts and all books and records, customer
lists and credit files related to any of the foregoing, and all proceeds and
products of any of the foregoing, and (b) when used generally, all of the
foregoing in which any Grantor now has or hereafter acquires any right or
interest, provided, however, the term "Collateral" shall not include, (x) any
Intellectual Property or software licenses to the extent that: (i) such
Intellectual Property or software licenses are not assignable or capable of
being encumbered as a matter of law or under the terms of the agreement for such
Intellectual Property or licenses, without the consent of the other parties
thereto or licensor thereof, and (ii) such consent has not been obtained or (y)
any equipment leased by a third party to Grantor to the extent that: (i) such
leased equipment is not assignable or capable of being encumbered as a matter of
law or under the terms of the equipment lease for such leased equipment, without
the consent of the lessor thereof, and (ii) such consent has not

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been obtained, and (z) any Contract, contract right, license, agreement, lease
pertaining to real or personal property or any other document, instrument or
agreement of any Grantor (each such item referred to in clause (x), (y) and (z)
hereof of such Grantor being hereinafter referred to as "Excluded Property"), if
the granting of a security interest therein by such Grantor to the Lender is
expressly prohibited by the terms and provisions of the written agreement,
document or instrument creating or evidencing such Excluded Property or rights
related thereto or by applicable law (it being understood and agreed that the
Grantors shall provide to the Lender written notice of any Excluded Property
and, promptly following a request by the Lender, such Grantor shall use its best
efforts to obtain from the Person in whose favor the prohibition has been
granted any waiver or consent necessary in order to remove or terminate such
prohibition or permit the Lender to have a security interest in the Grantors
rights to any such Excluded Property subject to such a prohibition and referred
to in such request, and that any such Excluded Property so referred to shall
constitute part of the Collateral as of the date hereof automatically upon the
execution and delivery of the applicable waiver or consent).
 
"Commercial Tort Claim" has the meaning set forth in the UCC.
 
"Contracts" means all contracts, agreements and other similar consensual
obligations, as the same may from time to time be amended, supplemented or
otherwise modified, including (a) all rights to receive moneys due and to become
due thereunder or in connection therewith, (b) all rights to damages arising out
of any breach or default in respect thereof and (c) all rights to perform and to
exercise remedies thereunder.
 
"Copyrights" means (i) all copyrights arising under the laws of the United
States, any other country or any political subdivision thereof, whether
registered or unregistered and whether published or unpublished, all
registrations and recordings thereof, and all applications in, connection
therewith, including all registrations, recordings and applications in the
United States Copyright Office, and (ii) the right to obtain all renewals
thereof.
 
"Copyright Licenses" means any written agreement naming any Grantor as licensor
or licensee, granting any right under any Copyright, including the grant of
rights to manufacture, distribute, exploit, and sell materials derived from any
Copyright.
 
"Default Period" means any period during which one or more Events of Default are
continuing.
 
"Deposit Accounts" has the meaning set forth in the UCC.
 
"Documents" means all "documents" (as defined in the UCC) or other receipts
covering, evidencing or representing Goods, now owned or hereafter acquired, by
any Grantor.
 
"Equipment" means all "equipment" (as defined in the UCC) now owned or hereafter
acquired by any Grantor, including all rolling stock.
 
"Event of Default" means an "Event of Default" as set forth in the Term Loan
Facility Letter.
 
"Excluded Property" has the meaning set forth in the definition of Collateral.
 
"Farm Products" has the meaning set forth in the UCC.
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"Fixtures" means all "fixtures" (as defined in the UCC) and all goods which are
or are to be attached to real property in such a manner that their removal would
cause damage to the real property and which have therefore taken on the
character of the property.
 
"General Intangibles" means all "general intangibles" (as defined in the UCC),
including payment intangibles and Software, now owned or hereafter acquired by
any Grantor, including (i) all right, title and interest in or under any
Contract, models, drawings, materials and records, claims, literary rights,
goodwill, rights of performance and warranties, (ii) all Intellectual Property,
copyright licenses, copyrights, patent licenses, patents, trademark licenses,
trademarks, other intellectual property rights, trade secrets, permits and
licenses and (iii) all rights under insurance policies and rights of
indemnification.
 
"Goods" has the meaning set forth in the UCC, including, without limitation,
embedded Software to the extent included in such Goods.
 
"Grantor Obligations" means the collective reference to the unpaid principal and
interest under the Facilities Letters (including interest accruing at the then
applicable rate provided in the Facilities Letters after the final repayment
date referred to therein or any acceleration thereof pursuant to the terms of
the Facilities Letters or after the commencement of any insolvency,
reorganization or like proceeding relating to Simclar) and all other obligations
and liabilities of any Grantor to the Lender or the Security Beneficiaries,
whether direct or indirect, absolute or contingent, due or to become due, or now
existing or hereafter incurred, which may arise under, out of or in connection
with the Facilities Letters, the other Loan Documents or any other document
made, delivered or given by any Grantor in connection with the Loan Documents,
in each case whether on account of principal, interest, reimbursement
obligations, foes, indemnities, costs, expenses or otherwise (including all fees
and disbursements of counsel to the Lender or the Security Beneficiaries that
are required to be paid by any Grantor pursuant to the terms of any of the
foregoing).
 
"Instruments" means all "instruments," "chattel paper" (whether tangible or
electronic) or "letters of credit" (each as defined in the UCC), including those
evidencing, representing, arising from or existing in respect of, relating to,
securing or otherwise supporting the payment of, any of the Accounts, including
(but not limited to) the Facilities Letters, drafts, bills of exchange, trade
acceptances and Letter-of-Credit Rights, now owned or hereafter acquired by any
Grantor.
 
"Intellectual Property" means all rights, priorities and privileges relating to
intellectual property, whether arising under United States, multinational or
foreign law or otherwise, including: all patents, patent applications, patent
disclosures and inventions (whether or not patentable and whether or not reduced
to practice); all trademarks, service marks, trade dress, trade names and
corporate names and all the goodwill associated therewith; all registered and
unregistered statutory and common law copyrights; all registrations,
applications and renewals for any of the foregoing; all mask works; all trade
secrets, confidential information, ideas, formulae, compositions, know-how,
manufacturing and production processes and techniques, research and development
information, drawings, specifications, designs, plans, improvements, proposals,
technical and computer data, financial, business and marketing plans, and
customer

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and supplier lists and related information; all other proprietary rights
(including all computer software and documentation and all license agreements
and sublicense agreements to and from third parties relating to any of the
foregoing); all copies and tangible embodiments of the foregoing (in whatever
form or medium); all damages and payments for past, present and future
infringements of the foregoing; all royalties and income due with respect to the
foregoing; and the right to sue (whether at law or in equity) and recover for
past, present and future infringements of the foregoing, and for the avoidance
of doubt, to the extant not included in, the foregoing, all Copyrights,
Copyright Licenses, Patents, Patent Licenses, Trademarks and Trademark Licenses.
 
"Intellectual Property Collateral" means any Intellectual Property constituting
a part of the Collateral.
 
"Inventory" means all "inventory" (as defined in the UCC), now owned or
hereafter acquired by any Grantor, wherever located, and shall also mean and
include 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.
 
"Investment Property" has the meaning set forth in the UCC.
 
"Letter-of-Credit Rights" has the meaning set forth in the UCC (whether or not
the letter of credit is evidenced by a writing).
 
"Lien" means, with respect to any asset, any mortgage, lien, pledge, charge,
security interest or similar encumbrance, whether voluntary or involuntary or
arising by operation of law, in respect of such asset, including the Security
Interests. For purposes of this Agreement, a Person shall be deemed to own
subject to a Lien any asset which it has acquired or holds subject to the
interest of a vendor or lessor under any conditional sale agreement, capital
lease or other title retention agreement relating to such asset.
 
"Loan Document" the "BoS Documents" as defined in Term Loan Facility Letter,
together with this Agreement or any other financing statement, agreement,
document or instrument entered into or delivered pursuant thereto or hereto.
 
"Material Alteration" has the meaning set forth in Section 4.8(b)(ii).
 
"Patents" means (i) all letters patent of the United States, any other country
or any political subdivision thereof, all reissues and extensions thereof and
all goodwill associated therewith, (ii) all applications for letters patent of
the United States or any other country or any political subdivision thereof an
all divisions, continuations and continuations-in-part thereof, and (iii) all
rights to obtain any reissues or extensions of the foregoing.
 
"Patent License" means all agreements, whether written or oral, providing for
the grant by or to any Grantor of any right to manufacture, use or sell any
invention covered in whole or in part by a Patent.
 
"Permitted Liens" means (i) Liens for taxes, assessments, governmental charges
or claims that are not yet due and payable or that are being contested in good
faith by appropriate legal

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proceedings promptly instituted and diligently conducted and for which a reserve
or other appropriate provision, if any, as shall be required in conformity with
generally accepted accounting principals ("GAAP") shall have been made, (ii)
statutory and common law Liens of landlords and carriers, warehousemen,
mechanics, suppliers, repairmen or other similar liens arising in the ordinary
course of business and with respect to amounts not yet delinquent or being
contested in good faith by appropriate legal proceedings promptly instituted and
diligently conducted and for which a reserve or other appropriate provision, if
any, as shall be required in conformity with GAAP shall have been made, (iii)
Liens incurred or deposits made in the ordinary course of business in connection
with workers' compensation, unemployment insurance and other types of social
security, (iv) those Liens on Equipment set forth on Annex IV hereto, and (v)
Liens permitted pursuant to the Facilities Letters.
 
"Person" means any individual, corporation, company, limited liability company,
voluntary association, partnership, limited liability partnership, joint
venture, trust, unincorporated organization or government (or any agency,
instrumentality or political subdivision thereof).
 
"Pledge Agreement" means that certain Third Amended and Restated Pledge
Agreement dated February 23, 2006 and executed in connection with the Facilities
Letters.
 
"Pledged Account" has the meaning set forth in Section 7.1.
 
"Pledged Deposits" means all deposits of money, whether or not evidenced by
certificates, with any bank (including all rights to receive interest on such
deposits and all other sums credited by or due from third parties with respect
thereto), which originate from Collateral or Proceeds and which are deposited
with any bank or other financial institution following an Event of Default.
 
"Proceeds" means all proceeds of, and all other profits, products, rentals or
receipts, in whatever form, arising from the collection, sale, lease, exchange,
assignment, licensing or other disposition of, or other realization upon,
collateral, including all claims of any Granter against third parties for loss
of, damage to or destruction of, or for proceeds payable under, or unearned
premiums with respect to, policies of insurance in respect of, any Collateral,
and any condemnation or requisition payments with respect to any Collateral, in
each case whether now existing or hereafter arising.
 
"Receivables" means the Accounts, Chattel Paper, Pledged Deposits, Documents,
General Intangibles, Intellectual Property representing rights to the payment of
money (however arising), and any related Instruments.
 
"Released Collateral" has the meaning set forth in Section 9.10(c).
 
"Security Beneficiary" means the Lender and any assignee, novatee or transferee
of any of the rights and obligations of the Lender under the Facilities Letters.
 
"Security Interests" means the security interests in the Collateral granted
hereunder securing the Grantor Obligations.

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"Software" has the meaning set forth in the UCC.
 
"Supporting Obligations" has the meaning set forth in the UCC.
 
"Trademarks" means (i) all trademarks, trade names, corporate names, company
names, business names, fictitious business names, trade styles, service marks,
logos and other source or business identifiers, and all goodwill associated
therewith, now existing or hereafter adopted or acquired all registrations and
recordings thereof, and all applications in connection therewith, whether in the
United States Patent and Trademark Office or in any similar office or agency of
the United States, any State thereof or any other country or any political
subdivisions thereof, or otherwise and all common-law rights related thereto,
and (ii) the right to obtain all renewals thereof.
 
"Trademark License" means any agreement, whether written or oral, providing for
the grant by or to any Grantor of any right to use any Trademark.
 
"UCC" means the Uniform Commercial Code as from time to time in effect in the
State of Florida; provided that if by reason of mandatory provisions of law, the
perfection or the effect of perfection or non-perfection of a security interest
in any Collateral is governed by the Uniform Commercial Code as in effect in a
jurisdiction other than Florida, "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; and
provided further that to the extent that the UCC is used to define any term
herein or in any Loan Document and such term is defined differently in different
Articles or Divisions of the UCC, the definition of such term contained in
Article or Division 9 shall govern.
 
2.    GRANT.
 
To secure payment, performance and observance of the Grantor Obligations, each
Grantor hereby: (i) pledges, and grants to the Lender, for the benefit of the
Lender and the other Security Beneficiaries, a continuing security interest in,
and a right of set-off against, such Grantor's Collateral (including the
Intellectual Property Collateral) and all present and future right, title and
interest of such Grantor therein; and (ii) upon demand by the Lender, upon the
occurrence of an Event of Default and until such Event of Default shall have
been cured, assigns, transfers and conveys the Intellectual Property Collateral
to the Lender, for the benefit of the Lender and the other Security
Beneficiaries.
 
The security interests and assignments granted herein shall not relieve any
Grantor from the performance of any term, covenant, condition or agreement on
such Grantor's part to be performed or observed under or in respect of any of
the Collateral or impose any obligation on the Lender or any Security
Beneficiary to perform or observe any such term, covenant, condition or
agreement on such Grantor's part to be so performed or observed or impose any
liability on the Lender or any Security Beneficiary for any act or omission on
the part of such Grantor relative thereto or for any breach of any
representation or warranty on the part of such Grantor contained in this
Agreement or any of the Loan Documents or in respect of the Collateral or made
in connection herewith or therewith.

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3.    REPRESENTATIONS AND WARRANTIES.
 
Each Grantor hereby represents and warrants to the Lender and to each Security
Beneficiary, as of the date hereof (which representations and warranties are in
addition to, and not in lieu of or in limitation of any representations and
warranties made in any of the other Loan Documents) that:
 
Section 3.1. Principal Location; Jurisdiction of Incorporation. Such Grantor's
mailing address, and the location of its chief executive office and each
location of any books and records (including all computer data and related
software including source codes) relating to the Accounts is disclosed in Annex
I hereto; such Grantor has no other places of business except those set forth in
Annex I hereto. Simclar is a corporation duly organized, validly existing and in
good standing in the State of Florida. Simclar - Mexico is a corporation duly
organized, validly existing and in good standing in the State of Illinois.
Simclar SA is an entity duly organized, validly existing and in good standing
under the laws of Mexico. Simclar NA is an entity duly organized, validly
existing and in good standing in the State of North Carolina.
 
Section 3.2. Property Locations. Except as permitted hereby, the Inventory,
Equipment and Fixtures are located solely at the locations described in Annex I
hereto. Except as permitted hereby, none of such locations are leased by such
Grantor as lessee except those so designated in Annex I hereto.
 
Section 3.3. No Other Names. Except as listed on Annex II hereto, such Grantor
does not conduct or has not conducted any trade or business under any name
except the name in which it has executed this Agreement. Such Grantor has not
been a party to any merger or consolidation in the last five years except as
disclosed on Annex II.
 
Section 3.4. Filing Requirements. None of the Equipment is covered by any
certificate of title. None of the Collateral consists of property subject to a
statute or treaty referred to in Section 9-311 of the UCC (other than
Intellectual Property Collateral). None of the Collateral is of a type with
respect to which any Lien may be filed under any federal statute except for
patents, copyrights and trademarks held by such Grantor and described in Annex
III hereto.
 
Section 3.5. No Financing Statements. Except for financing statements filed with
respect to the Equipment set forth on Annex IV, no financing statement
describing all or any portion of the Collateral which has not lapsed or been
terminated has been filed in any jurisdiction except financing statements naming
the Lender as secured party.
 
Section 3.6. Title to Properties. Such Grantor has good and marketable title to
and ownership of the Collateral held by it, free and clear of all Liens except
Permitted Liens. Such Grantor has taken all actions necessary under the UCC to
perfect its interest in any Accounts purchased or otherwise acquired by it, as
against its assignors and creditors of its assignors. Except for the Equipment
set forth on Annex IV, no Collateral is in the possession of any Person (other
than such Grantor) asserting any claim thereto or Security Interest therein,
except that the Lender may have possession of Collateral as contemplated hereby.
 
Section 3.7. Intellectual Property. Annex III hereto contains a complete and
accurate list as of the date hereof of all patented and registered Intellectual
Property owned by such

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Grantor and all pending patent applications and applications for the
registration of other Intellectual Property owned or filed by such Grantor.
Annex III also contains a complete and accurate list of all licenses and other
rights granted by such Grantor to any third party with respect to the
Intellectual Property and licenses and other rights granted by any third party
to such Grantor. Except as set forth on Annex III such Grantor has made all
necessary filings and recordations and has paid all required fees and taxes to
record and maintain its ownership of the patented or registered intellectual
property rights in the United States Patent and Trademark Office and the United
States Copyright Office and in each other applicable filing office (whether in
the United States or otherwise) and no consents are required under any licenses
listed in Annex III to the grant of the security interest to, and exercise of
any rights and remedies of, the Lender.
 
Section 3.8. Contracts. No consent of any party to any Contract is required in
connection with the execution, delivery and performance of this Agreement, other
than consents which if not obtained could not, individually or in the aggregate,
result in a Material Adverse Effect and those consents set forth in clauses
(x)(i) and (y)(i) under the definition of "Collateral."
 
Section 3.9. Farm Products. None of the Collateral constitutes, or is the
Proceeds of, Farm Products.
 
Section 3.10. Perfection Certificate. The information set forth in the
Perfection Certificate substantially in the form of Exhibit A attached hereto
and delivered to the Lender on the date hereof and prior to the execution and
delivery of this Agreement is correct and complete.
 
Section 3.11. Security Interest. The Security Interests constitute valid
security interests under the UCC and other applicable law securing the Grantor
Obligations. The Security Interests constitute perfected security interests in
the Collateral to the extent that a security interest therein may be perfected
(a) by filing pursuant to the UCC, (b) with respect to registered Intellectual
Property Collateral, by filing with the United States Patent and Trademark
Office or the United States Copyright Office, or (c) with respect to money,
letters of credit, instruments and certificated securities, by possession of the
Collateral if maintained by the Lender or any Security Beneficiary. Such
perfected Security Interests are and at all times shall be prior to all Liens
and rights of others therein except for (a) unrecorded Permitted Liens which are
(i) not for borrowed money, (ii) are not securing obligations which are past due
and (iii) have priority over the Security Interests by operation of law, and (b)
Permitted Liens on Equipment existing on the date hereof and identified on Annex
IV.
 
Section 3.12. Receivables. No amount payable to such Grantor under or in
connection with any Receivable is evidenced by any Instrument or Chattel Paper
which has not been delivered to the Lender; none of the obligors on any
Receivable is a governmental authority (including any the United States, any
state thereof, or any other United States or foreign federal, state or local
governmental agency, authority, instrumentality, regulatory body or
subdivision); and the amounts represented by each Grantor to the Lender or any
Security Beneficiary from time to time as owing to such Grantor in respect of
the Receivables will at all such times be accurate in all material respects.

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4.    COVENANTS.
 
From the date of this Agreement, and thereafter until this Agreement is
terminated:
 
Section 4.1. Inspection and Verification. The Lender and such Persons as the
Lender may designate from time to time shall have the right, at any reasonable
time or times upon prior notice and during each Grantor's usual business hours,
to inspect the Collateral, all records related thereto (and to make extracts and
copies from such records), and the promises upon which any of the Collateral is
located. In addition, the Lender and its designees shall have such other
inspection and verification rights concerning the Collateral as are provided or
permitted under other of the Loan Documents.
 
Section 4.2. Records and Reports. Each Grantor will maintain complete and
accurate books and records with respect to the Collateral, and furnish to the
Lender such reports relating to the Collateral as the Lender shall from time to
time reasonably request.
 
Section 4.3. Financing Statements and Other Actions. Each Grantor will execute
and deliver to the Lender and hereby authorizes the Lender to file all financing
statements and amendments thereto and other documents, and take such other
actions, as are from time to time reasonably requested by the Lender in order to
perfect and to maintain and protect a first priority perfected Security Interest
in the Collateral or to enable the Lender, on behalf of the Security
Beneficiaries, to exercise and enforce its rights and remedies hereunder with
respect to the Collateral.
 
Section 4.4. Change in Location or Name; Change in Jurisdiction of Organization.
Each Grantor will not (i) have any Inventory or Equipment or products thereof
(other than Inventory sold in the ordinary course of its business) at a location
other than a location specified in Annex I hereto, except for Inventory and
Equipment in transit between such locations, (ii) maintain records relating to
the Receivables at a location other than those locations specified on Annex I
hereto as a location where such records are kept, (iii) maintain a place of
business at a location other than a location specified on Annex I hereto, (iv)
change its name or jurisdiction of organization, or (v) change its mailing
address, unless in each such case such Grantor shall have given the Lender at
least 30 days' prior written notice thereof and delivered any financing
statements or other documents requested by the Lender.
 
Section 4.5. Other Financing Statements; Other Liens. Each Grantor will not
sign, authorize the signing on its behalf or authorize the filing of any
financing statement naming it as debtor which covers all or any portion of the
Collateral, except financing statements naming the Lender as secured party and
those filed in respect of Permitted Liens. Each Grantor shall not create, permit
or suffer to exist any Liens on or with respect to any of the Collateral except
Permitted Liens on Equipment existing on the date hereof and identified on Annex
IV. Each Grantor acknowledges that it is not authorized to file any amendment or
termination statement with respect to any financing statement without the prior
written consent of the Lender and agrees that it will not do so without the
prior written consent of the Lender (other than such filings that are made with
respect to Permitted Liens), subject to such Grantor's rights under Section
9-509(d)(2) of the UCC.

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Section 4.6. Accounts.
 
(a) Except as otherwise provided in this Agreement, each Grantor will collect
and enforce in accordance with its past collection practices and procedures, at
each Grantor's sole expense, all amounts due or hereafter due to such Grantor
under the Accounts.
 
(b) Except in the ordinary course of business, each Grantor will not, without
the Lender's prior written consent, grant any extension of the time of payment
of any of the Accounts, compromise, compound or settle the same for less than
the full amount thereof, release, wholly or partly, any Person liable for the
payment thereof, or allow any credit or discount whatsoever thereon.
 
Section 4.7. Maintenance of Inventory and Equipment. Each Grantor will do all
things necessary to maintain, preserve, protect and keep the Inventory in
saleable condition and the Equipment in as good a state of repair and condition
as at the date hereof except for ordinary wear and tear.
 
Section 4.8. Insurance.
 
(a) Each Grantor hereby irrevocably makes, constitutes, and appoints the Lender
(and all officers, employees, or agents designated by the Lender) as such
Grantor's true and lawful attorney (and agent-in-fact) for the purpose of
making, settling, and adjusting claims under policies of insurance, endorsing
the name of such Grantor on any check, draft, instrument, or other item of
payment for the proceeds of such policies of insurance and for making all
determinations and decisions with respect thereto. In the event that a Grantor
at any time or times shall fail to obtain or maintain any of the policies of
insurance required by Section 4.8(b) or to pay any premium in whole or part
relating thereto, the Lender may, without waiving or releasing any obligation or
liability of such Grantor hereunder or any Event of Default, in its sole
discretion, obtain and maintain such policies of insurance and pay such premium
and take any other action with respect thereto as the Lender deems advisable.
All such sums so disbursed by the Lender, including reasonable attorneys' fees
and expenses, court costs, expenses and other charges relating thereto, shall be
payable, upon demand, by such Grantor to the Lender and shall be additional
Grantor Obligations secured hereby.
 
(b) (i) Each Grantor will maintain, with financially sound and reputable
companies, insurance policies (A) insuring the Collateral against loss by fire,
explosion, theft and such other casualties in accordance with its past business
practices and (B) to the extent requested by the Lender, insuring such Grantor,
the Lender and the Security Beneficiaries against liability for loss by fire,
explosion, theft and such other casualties, personal injury and property damage
relating to such Collateral in such form and amounts as may be reasonably
required by the Lender.
 
(ii) All such insurance shall at all times (A) provide that no cancellation,
material reduction in amount or material change in coverage (collectively, a
"Material Alteration"), thereof shall be effective until at least 30 days after
receipt by the Lender of written notice thereof except, in the case of any
Material Alteration resulting from nonpayment of premiums, in which instance
such Material Alteration shall not be effective until at least 10 days after
receipt

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by the Lender of written notice thereof, (B) name the Lender as insured party or
loss payee, and (C) be reasonably satisfactory to the Lender in all other
respects.
 
(iii) Each Grantor shall deliver to the Lender a report of a reputable insurance
broker with respect to such insurance as the Lender may from time to time
reasonably request.
 
Section 4.9. Titled Vehicles. Upon request of the Lender, each Grantor shall
promptly execute and deliver any instruments and documents that may be necessary
or that the Lender may request in order to perfect the Security Interests in all
property now or hereafter owned by such Grantor and subject to a certificate of
title.
 
Section 4.10. Bailees. If any Collateral of a Grantor is in the possession or
control of any warehouseman, processor or other bailee, such Grantor shall
notify such warehousemen, processors and other bailees in writing (with a copy
to the Lender) of the Lender's security interest therein and, upon the
occurrence and continuation of an Event of Default and upon the Lender's
request, instruct such Persons to hold all such Collateral for the Lender's
account and subject to the Lender's instructions. Each Grantor will use its best
efforts to obtain from any warehouseman, processor or other bailee written
acknowledgment, in form and substance satisfactory to Lender, that such
warehouseman, processor or other bailee holds possession of the Collateral for
the Lender's benefit. If any Grantor is unable to obtain a written
acknowledgment of the type required by the previous sentence from any
warehouseman, processor or other bailee, then such Grantor shall move such
Collateral to a warehouseman, processor or bailee who will provide the required
acknowledgment. If more than $100,000 of Collateral of a Grantor is held by a
bailee, such Grantor will file a financing statement in the appropriate
jurisdiction against such bailee in a form appropriate for the underlying
transaction. In addition, each Grantor agrees that if any warehouse receipt or
receipt in the nature of a warehouse receipt is issued with respect to any of
its Inventory, such warehouse receipt or receipt in the nature of a warehouse
receipt shall not be "negotiable" (as such term is defined in Section 7-104 of
the Uniform Commercial Code as in effect in any relevant jurisdiction or under
other relevant law), or, if any warehouse receipt or receipt in the nature
thereof is "negotiable" (as such term is so used), such Grantor shall promptly
take all action as may be required under the relevant jurisdiction to grant a
perfected security interest in such Collateral to the Lender for the benefit of
the Security Beneficiaries.
 
Section 4.11. Delivery of Pledged Collateral; Control of Collateral. To the
extent not required to be delivered to the Lender pursuant to another provision
of this Agreement or pursuant to another Loan Document, each Grantor will hold
in trust for the Lender upon receipt and, upon the occurrence of an Event of
Default and the continuation thereof or if otherwise requested by the Lender,
promptly deliver to the Lender the originals of all Instruments, Documents,
Chattel Paper, letters of credit, certificated securities and certificates
issued in respect of Pledged Deposits, which shall be endorsed in blank, marked
with such legends and accompanied by such stock powers and assignments as the
Lender shall specify. To the extent Pledged Deposits constitute Deposit
Accounts, each Grantor shall take all steps that may be required (including the
obtaining and furnishing to the Lender appropriate account control agreements as
required under Section 9-104 of the UCC) to grant "control" (as defined in
Section 9-104 of the UCC) to the Lender. Each Grantor further agrees to take
such steps as Lender may reasonably request for the Lender to obtain "control"
(as set forth in corresponding provisions in

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Sections 9-104, 9-105, 9-106 and 9-107 relating to what constitutes "control"
for such items of Collateral) of any Investment Property, other Deposit
Accounts, Letter-of-Credit Rights or electronic Chattel Paper, with any
agreements establishing control to be in form and substance satisfactory to the
Lender.
 
Section 4.12. Investment Property. If a Grantor acquires any Investment Property
(whether or not a certificated security), such Grantor (i) shall take and cause
all other relevant parties to take all such actions as may be requested by the
Lender (including obtaining for the Lender the agreement of any securities
intermediary to comply with instructions and entitlement orders originated by
the Lender without further consent of such Grantor or other registered owner or
entitlement holder) in order to cause the Security Interests in such Collateral
to be perfected by "control" (as such term is used in Articles 8 and 9 of the
UCC) and (ii) will take and will cause such other relevant parties to take all
other action necessary or appropriate to create and maintain a perfected first
priority Lien in such Investment Property in favor of the Lender for the benefit
of the Security Beneficiaries.
 
Section 4.13. Intellectual Property Covenant. Each Grantor shall make all
necessary filings and recordings and pay all required fees and taxes to record
and maintain its registration and ownership of, and do all other things and take
all other actions necessary to preserve, protect and maintain, each item of
Intellectual property owned by it, other than such items the loss or forfeiture
of which would not individually or in the aggregate have a Material Adverse
Effect. Without limiting the foregoing:
 
(a) Each Grantor (either itself or through licensees) will (i) continue to use
each material Trademark on each and every trademark class of goods applicable to
its current line as reflected in its current catalogs, brochures and price lists
in order to maintain such trademark in full force free from any claim of
abandonment for non-use, (ii) maintain as in the past the quality of products
and services offered under such Trademark, (iii) use such Trademark with the
appropriate notice of registration and all other notices and legends required by
applicable requirements of law, (iv) not adopt or use any mark which is
confusingly similar or a colorable imitation of such Trademark unless the
Lender, for the benefit of the Security Beneficiaries, shall obtain a perfected
Security Interest in such mark pursuant to this Agreement, and (v) not (and not
permit any licensee or sublicensee thereof to) do any act or knowingly omit to
do any act whereby such Trademark may become invalidated or impaired in any way.
 
(b) Each Grantor (either itself or through licensees) will not do any act, or
omit to do any act, whereby any material Patent may become forfeited, abandoned
or dedicated to the public.
 
(c) Each Grantor (either itself or through licensees) (i) will employ each
material Copyright and (ii) will not (and will not permit any licensee or
sublicensee thereof to) do any act or knowingly omit to do any act whereby any
material portion of the Copyrights may become invalidated or otherwise impaired.
Such Grantor will not (either itself or through licensees) do any act whereby
any material portion of the Copyrights may fall into the public domain.

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(d) Each Grantor (either itself or through licensees) will not do any act that
knowingly uses any material Intellectual Property to infringe the intellectual
property rights of any other Person.
 
(e) Each Grantor will notify the Lender and the Security Beneficiaries
immediately if it knows, or has reason to know, that any application or
registration relating to any material Intellectual Property may become
forfeited, abandoned or dedicated to the public, or of any adverse determination
or development (including the institution of, or any such determination or
development in, any proceeding in the United States Patent and Trademark Office,
the United States Copyright Office or any court or tribunal in any country)
regarding such Grantor's ownership of, or the validity of, any material
Intellectual Property or such Grantor's right to register the same or to own and
maintain the same.
 
(f) Whenever a Grantor, either by itself or through any agent, employee,
licensee or designee, shall file an application for the registration of
Intellectual Property with the United States Patent and Trademark Office, the
United States Copyright Office or any similar office or agency in any other
country or any political subdivision thereof, such Grantor shall report such
filing to the Lender within five business days after the last day of the fiscal
quarter in which such filing occurs. Upon request of the Lender, each Grantor
shall execute and deliver, and have recorded, any and all agreements,
instruments, documents and papers as the Lender may request to evidence the
Security Interest in any Copyright, Patent or Trademark and the goodwill and
general intangibles of such Grantor relating thereto or represented thereby.
 
(g) Each Grantor shall take all reasonable and necessary steps, including in any
proceeding before the United Status Patent and Trademark Office, the United
States Copyright Office or any similar office or agency in any other country or
any political subdivision thereof to maintain and pursue each application (and
to obtain the relevant registration) and to maintain each registration of the
material Intellectual Property, including filing of applications for renewal,
affidavits of use and affidavits of incontestability.
 
(h) In the event that any material Intellectual Property is infringed,
misappropriated or diluted by a third party, each Grantor shall (i) take such
actions as such Grantor shall reasonably deem appropriate under the
circumstances to protect such Intellectual Property and (ii) if such
Intellectual Property is of material economic value, promptly notify the Lender
after it learns thereof and sue for infringement, misappropriation or dilution,
to seek injunctive relief where appropriate and to recover any and all damages
for such infringement, misappropriation or dilution.
 
Section 4.14. Federal Claim.
 
(a) Claims. Each Grantor will notify the Lender of any material Receivable which
constitutes a claim against the United States government or any instrumentality
or agency thereof, the assignment of which claim is restricted by federal law.
 
(b) Action. Upon the request of the Lender, each Grantor will take all
reasonable actions required to comply to the Lender's satisfaction, with the
Assignment of Claims Act of 1940, as amended, or any similar applicable law,
with respect to any such material Receivable.

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Section 4.15. Commercial Tort Claims. If any Grantor shall at any time acquire a
Commercial Tort Claim, then such Grantor shall immediately notify the Lender in
writing signed by such Grantor of the brief details thereof and grant to the
Lender in such writing a security interest therein and in the proceeds thereof,
all upon the terms of this Agreement, with such writing to be in form and
substance satisfactory to the Lender.
 
Section 4.16. Subsidiaries. If any Grantor shall at any time control, directly
or indirectly, or acquire any direct or indirect equity participation in, any
corporation, partnership, trust or other business association, then such Grantor
shall immediately notify the Lender in writing signed by such Grantor of the
details thereof and take all action with may be necessary to grant to the agent
a security interest therein. Simclar agrees to cause Simclar - England to become
a party to this Agreement upon the acquisition of any assets.
 
5.    REMEDIES UPON DEFAULT.
 
Upon the occurrence and during the continuance of an Event of Default, whether
or not all of the Grantor Obligations shall have become due and payable, the
Lender may, in addition to its rights under any of the Loan Documents:
 
Section 5.1. General. Exercise any or all of the rights and remedies provided
(i) in this Agreement, (ii) to a secured party when a debtor is in default under
a security agreement governed by the UCC or (iii) to a secured party when a
debtor is in default by any other applicable law including any law governing the
exercise of a bank's right of set-off or bankers' lien. Without precluding any
other methods of sale, the sale of Collateral shall be deemed to have been made
in a commercially reasonable manner if conducted in conformity with reasonable
commercial practices of commercial lenders disposing of similar property, but in
any event the Lender may sell Collateral on such terms as the Lender may choose
without assuming any credit risk and without any obligation to advertise or give
notice of any kind not expressly required under this Agreement or required by
applicable law (to the extent such notice may not be waived under applicable
law).
 
Section 5.2. Sale or Disposition of Collateral. Collect, receive, appropriate
and realize upon the Collateral, and sell, resell, assign, lease, give option or
options to purchase, or otherwise dispose of, transfer and deliver all or any
part of the Collateral (or contract to do any of the foregoing), in one or more
parcels at public or private sale or sales, at any exchange, broker's board or
office of the Lender or any Security Beneficiary or elsewhere upon such terms
and conditions as it may deem advisable and at such prices as it may deem best,
for cash or on credit or for future delivery without assumption of any credit
risk. The Lender or any Security Beneficiary shall have the right upon any such
public sale or sales, and, to the extent permitted by law, upon any such private
sale or sales, to purchase the whole or any part of the Collateral so sold, free
of any right or equity of redemption in any Grantor, which right or equity is
hereby waived and released to the fullest extent permitted by applicable law. To
the fullest extent permitted by applicable law, each Grantor waives all claims,
damages and demands it may acquire against the Lender or any Security
Beneficiary arising out of the exercise by them of any rights hereunder.

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Section 5.3. Access to Leased Premises. Immediately enter upon any premises
leased by any Grantor for the storage, warehousing or maintenance of Inventory
and remove, take possession and dispose of, or store at another site, such
Inventory in the Lender's sole discretion.
 
Section 5.4. Pledged Deposits. Without any necessity on the Lender's part to
resort to other security or sources of reimbursement for the Grantor
Obligations, at any time during the continuance of an Event of Default and
without notice to any Person, exercise rights of set-off against any of the
Pledged Deposits (general or special, time or demand, provisional or final) or
other sums of any Grantor in the possession of or in transit to the Lender for
application to the Grantor Obligations, which rights shall be cumulative with
the Lender's other rights and remedies including other rights of set-off.
 
Section 5.5. Grant of License to Use General Intangibles. For the purpose of
enabling the Lender to exercise rights and remedies thereunder during the
continuation of an Event of Default, each Grantor hereby grants to the Lender an
irrevocable, nonexclusive license (to the extent permitted by applicable law,
exercisable without payment of royalty or other compensation to such Grantor) to
use, assign, license or sublicense any of the General Intangibles to the extent
permitted by the terms of such General Intangibles, wherever the same may be
located, including in such license reasonable access to all media in which any
of the General intangibles may be recorded or stored and to all computer
programs used for the compilation or printout thereof. Notwithstanding the
foregoing, the Lender shall have no obligations or liabilities regarding any or
all or the General Intangibles by reason of or arising out of, this Agreement.
 
Section 5.6. Specific Performance. Each Grantor agrees that, in addition to all
other rights and remedies granted to the Lender in this Agreement and any other
Loan Document, the Lender shall be entitled to specific performance said
injunctive and other equitable relief, and each Grantor further agrees to waive
any requirement for the securing or posting of any bond or other security in
connection with the obtaining of any such specific performance and injunctive or
other equitable relief.
 
Section 5.7. Additional Liabilities Upon Default. Upon the request of the Lender
after the occurrence and during the continuance of an Event of Default, each
Grantor will promptly
 
(a) Assembly of Collateral. Assemble and make available to the Lender the
Collateral and all records relating thereto at any place or places specified by
the Lender within the continental United States of America.
 
(b) Secured Party Access. Permit the Lender, or the Lender's representatives and
agents, to enter any premises where all or any part of the Collateral, or the
books and records relating thereto, or both, are located, to take possession of
all or any part of the Collateral and to remove all or any part of the
Collateral.
 
6.    WAIVERS, AMENDMENTS AND REMEDIES.
 
No failure on the part of the Lender to exercise, and no delay in exercising,
any right, power or remedy hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any such right, power or remedy by the
Lender preclude any other or further exercise

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thereof or the exercise of any other right, power or remedy. All remedies
hereunder are cumulative and are not exclusive of any other remedies provided by
law. The Lender shall not be deemed to have waived any rights hereunder or under
any other agreement or instrument unless such waiver shall be in writing and
signed by such parties.
 
7.    PROCEEDS; COLLECTION OF RECEIVABLES.
 
Section 7.1. Collection of Receivables. The Lender may at any time during a
Default Period, without notice to any Grantor, elect to enforce collection of
any Receivable, require that the Proceeds of Receivables or other Collateral be
paid directly to the Lender or to any account specified by the Lender and/or
require that Proceeds of Receivables or other Collateral received by such
Grantor be deposited into any account specified by the Lender (any account
referred to in this sentence being a "Pledged Account"). During any Default
Period, each Grantor shall (if requested to do so by Lender), and/or Lender may,
promptly notify the account debtors or obligors of the Receivables of the
Lender's interest therein and direct such account debtors or obligors to make
payment of all amounts then or thereafter due under the Receivables directly to
the Lender or to any account specified by the Lender. During a Default Period,
each Grantor shall hold in trust for the Lender all amounts and Proceeds
received by it with respect to the Receivables and other Collateral, shall
segregate all such amounts and Proceeds from other funds of such Grantor, and
shall at all tames thereafter promptly deliver to the Lender (or into any
Pledged Account as the Lender may specify) all such amounts and Proceeds in the
same form as so received, whether by cash, check, draft or otherwise, with any
necessary endorsements. Each Grantor will execute and deliver to the Lender, for
delivery by the Lender to each bank or other financial institution with which it
maintains any bank or deposit account (or if so instructed by the Lender will
execute and deliver directly to each such bank or other financial institution)
such notices as the Lender may from time to time request advising each such bank
or other financial institution that Proceeds deposited to an account during a
Default Period constitute Pledged Deposits hereunder, subject to the Security
Interest granted hereby, and instructing each such bank or other financial
institution that during the Default Period each Pledged Account and all Pledged
Deposits are to be maintained by such bank or other financial institution
subject to the absolute dominion and control of the Lender and are to be
delivered, disbursed or otherwise distributed solely in accordance with the
instructions of the Lender, and such Grantor shall take all such other actions
as may otherwise be required under applicable law to perfect the Security
Interest in the Pledged Accounts and Pledged Deposits.
 
Section 7.2. Application of Proceeds.
 
(a) During the continuance of an Event of Default, the Lender shall have the
continuing and exclusive right to apply or reverse and re-apply any and all
payments to any portion of the Grantor Obligations. To the extent that a Grantor
makes a payment or payments to the Lender or the Lender receives any payment or
proceeds of the Collateral, which payment or proceeds or any part thereof are
subsequently invalidated, declared to be fraudulent or preferential, set aside
or required to be repaid to a trustee, receiver or any other party under any
bankruptcy law, state or federal law, common law or equitable cause, then, to
the extent of such payment or proceeds, the Grantor Obligations or part thereof
intended to be satisfied and this Agreement shall be revived and continue in
full force and effect, as if such payment or proceeds had not been received by
such party.

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(b) The proceeds of any sale of or collection of Collateral, as well as any
Collateral consisting of cash, shall be applied by the Lender first, to the
payment of the costs and expenses of any such sale or collection, including
reasonable fees and disbursements of the Lender's agents and counsel, and of any
judicial proceeding wherein the same may be made, and of all expenses,
liabilities and advances (to the extent such advances are reasonably made for
the protection of the Collateral or the enforcement of the Lender's security
interest in the Collateral) made or incurred by the Lender, together with
interest thereon, second, in satisfaction of the Grantor Obligations in the
order set forth in the Facilities Letter, and third, to whomsoever may be
lawfully entitled to receive any surplus. Each Grantor shall remain liable for
any deficiency if the proceeds of sale or other disposition of the Collateral
are insufficient to pay the Grantor Obligations and the fees and disbursements
of any attorneys employed by the Lender or any Security Beneficiary to collect
such deficiency. Upon any sale of the Collateral by the Lender (including
pursuant to a power of sale granted by statute or under a judicial proceeding),
the receipt of the Lender or of the officer making the sale shall be a
sufficient discharge to the purchaser or purchasers of the Collateral so sold
and such purchaser or purchasers shall not be obligated to see to the
application of any part of the purchase money paid over to the Lender or such
officer or be answerable in any way for the misapplication thereof.
 
8.    GENERAL PROVISIONS.
 
Section 8.1. Notice of Disposition of Collateral. Any notice of any public sale
or the time after which any private sale or other disposition of all or any part
of the Collateral may be made shall be deemed reasonable if given to each
Grantor at least 10 days prior to the time of any such public sale or the time
after which any such private sale or other disposition may be made.
 
Section 8.2. Compromises and Collection. Each Grantor recognizes that set-offs,
counterclaims, defenses and other claims may be asserted by obligors with
respect to certain of the Receivables, that certain of the Receivables may be or
become uncollectible in whole or in part and that the expense and probability of
success in litigating a disputed Receivable may exceed the amount that
reasonably may be expected to be recovered with respect to a Receivable. In view
of the foregoing, each Grantor agrees that the Lender may at any time and from
time to tune upon the occurrence and during the continuance of an Event of
Default, compromise with the obligor on any Receivable, accept in full payment
of any Receivable such amount as the Lender in its sole discretion shall
determine or abandon any Receivable, and any such action by the Lender shall be
commercially reasonable so long as the Lender acts in good faith based on
information known to it at the time it takes any such action.
 
Section 8.3. Secured Party Performance of Debtor Secured Liabilities. Without
having any obligation to do so, the Lender may perform or pay any obligation
which any Grantor has agreed to perform or pay in this Agreement but has not
performed or paid on the due date therefor and such Grantor shall reimburse the
Lender for any amounts paid or incurred pursuant to this Section 8.3. Each
Grantor's obligation to reimburse pursuant to the preceding sentence shall be
Grantor Obligations payable on demand.
 
Section 8.4. Authorization for Secured Party To Take Certain Action. Each
Grantor irrevocably authorizes the Lender at any time and from time to time in
the sole discretion of the

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Lender and appoints the Lender as its attorney-in-fact to act on behalf of such
Grantor, in the name of such Grantor or otherwise, from time to time in the
Lender's discretion, to take any action and to execute any instrument which the
Lender may deem necessary or advisable to accomplish the purposes of this
Agreement, including (but as to the matters described in the following clauses
(ii), (iv), (vi), (vii), (viii), (x) and (xi), only upon the occurrence and
during the continuance of an Event of Default): (i) to execute on behalf of such
Grantor as debtor and to file financing statements, continuation statements and
amendments thereto necessary or desirable in the Lender's sole discretion to
perfect and to maintain the perfection and priority of the Lender's security
interest in the Collateral; (ii) to endorse, deposit and collect any cash,
Instruments and other proceeds of the Collateral: (iii) to file a carbon,
photographic or other reproduction of this Agreement or any financing statement
with respect to the Collateral as a financing statement in such offices as the
Lender in its sole discretion deems necessary or desirable to perfect and to
maintain the perfection and priority of the Lender's security interest in the
Collateral; (iv) to enforce payment of the Receivables in the name of the Lender
or such Grantor; (v) to cause the proceeds of any Collateral received by the
Lender or any Security Beneficiary to be applied to the Grantor Obligations as
contemplated by the Loan Documents; (vi) to sign such Grantor's name on any
invoice or bill of lading relating to any Receivable, on drafts against
customers, on schedules and assignments of Receivables, on notices of
assignment, financing statements and other public records, on verifications of
accounts and on notices to customers; (vii) to notify the post office
authorities to change the address for delivery of such Grantor's mail to an
address designated by the Lender, and to receive, open and dispose of all mail
addressed to such Grantor; (viii) to send requests for verification of
Receivables to customers or account debtors (provided that this clause shall not
limit the Lender's rights under Section 4.1); (ix) to do any act or thing which
the Lender ought to execute and do under the terms of this Agreement or which
may be required or deemed proper in the exercise of any rights or powers
conferred on the Lender for any of the purposes of this Agreement; (x) to grant
or issue any exclusive or nonexclusive license under the Collateral to anyone;
(xi) to assign, pledge, convey or otherwise transfer title in or to or dispose
of the Collateral to anyone, including assignments, recordings, registrations
and applications therefor in the United States Patent and Trademark Office, the
United States Copyright Office or any similar office or agency of the United
States, any State thereof or any other country or political subdivision thereof,
and to execute and deliver any and all agreements, documents, instruments of
assignment or other papers necessary or advisable to effect any of the foregoing
or the recordation, registration, filing or perfection thereof; and (xii) to
file financing statements, continuation statements and amendments thereto that
describe the Collateral (a) as all assets of such Grantor or words of similar
effect, regardless of whether any particular asset comprised in the Collateral
falls within the scope of Article 9 of the UCC, or (b) as being of an equal or
lesser scope or with greater detail, and which contain any other information
required by Part 5 of Article 9 of the UCC for the sufficiency or filing office
acceptance of any financing statement, continuation statement or amendment,
including (x) whether the Grantor is an organization, the type of organization
and any organization identification number issued to the Grantor and (y) in the
case of a financing statement filed as a fixture filing or indicating Collateral
as as-extracted collateral or timber to cut, a sufficient description of the
real property to which the Collateral relates. Each Grantor hereby ratifies all
that such attorneys shall lawfully do or cause to be done by virtue hereof and
also ratifies its authorization for the Lender to have filed in any UCC
jurisdiction any like initial financing statements or amendments thereto if
filed prior to the date hereof. All powers, authorizations and agencies
contained in this Agreement are

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coupled with an interest and are irrevocable until this Agreement is terminated
and the security interests created hereby are released. The powers conferred on
the Lender and the other Security Beneficiaries hereunder are solely to protect
the Lender's and the Security Beneficiaries' interests in the Collateral and
shall not impose any duty upon the Lender or any Security Beneficiary to
exercise any such powers. The Lender and the Security Beneficiaries shall be
accountable only for amounts that they actually receive as a result of the
exercise of such powers, and neither they nor any of their officers, directors,
employees or agents shall be responsible to any Grantor for any act or failure
to act hereunder, except for their own gross negligence or willful misconduct.
 
Section 8.5. Use and Possession of Certain Premises. Upon the occurrence and
during the continuance of an Event of Default, the Lender or its agents or
representatives shall be entitled to occupy and use any premises owned or leased
by any Grantor where any of the Collateral or any records relating to the
Collateral are located until the Grantor Obligations are paid in full or until
the Collateral is removed therefrom, whichever occurs first, without any
obligation to pay such Grantor for such use and occupancy.
 
Section 8.6. Standard of Care. The Lender's sole duty with respect to the
custody, safekeeping and physical preservation of the Collateral in its
possession, under Section 9-207 of the UCC or otherwise, shall be to deal with
it in the same manner as the Lender deals with similar property for its own
account. Neither the Lender, any Security Beneficiary nor any of their
respective officers, directors, employees or agents shall be liable for failure
to demand, collect or realize upon any of the Collateral or for any delay in
doing so or shall be under any obligation to sell or otherwise dispose of any
Collateral upon the request of any Grantor or any other Person or to take any
other action whatsoever with regard to the Collateral or any part thereof.
 
Section 8.7. Specific Provisions Regarding Execution and Filing of Financing
Statements. Pursuant to the UCC and any other applicable law, each Grantor
authorizes the Lender to file or record financing statements and other filing or
recording documents or instruments with respect to the Collateral or to use a
generic description such as "all assets" or "all property" without the signature
of such Grantor in such form and in such offices as the Lender reasonably
determines appropriate to perfect the security interests granted hereunder. To
the extent permitted under the UCC, a photographic or other reproduction of this
Agreement shall be sufficient as a financing statement or other filing or
recording document or instrument for filing or recording in any jurisdiction.
 
9.    MISCELLANEOUS.
 
Section 9.1. [Intentionally Omitted]
 
Section 9.2. [Intentionally Omitted]
 
Section 9.3. Security Interest Absolute. The obligations of each Grantor under
this Agreement are independent of the obligations under any of the other Loan
Documents, and a separate action or actions may be brought and prosecuted
against any single, or every, Grantor to enforce this Agreement. All rights of
the Lender hereunder, the security interests granted

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hereby, and all Grantor Obligations of each Grantor hereunder, shall be absolute
and unconditional irrespective of (a) any lack of validity or enforceability of
any of the Loan Documents, any agreement with respect to any of the Grantor
Obligations or any other agreement or instrument relating to any of the
foregoing, (b) any change in the time, manner or place of payment of, or in any
other term of, all or any of the Grantor Obligations, or any other amendment or
waiver of or any consent to any departure from any of the Loan Documents or any
other agreement or instrument, (c) any exchange, release or non-perfection of
any other Collateral, or any release, amendment or waiver of, or consent to or
departure from, any guaranty for all or any of the Grantor Obligations, or (d)
any other circumstance which might otherwise constitute a defense available to,
or a discharge of, any Grantor in respect of the Grantor Obligations or in
respect of this Agreement.
 
Section 9.4. Lender's Fees and Expenses - Indemnification.
 
(a) Each Grantor agrees to pay upon demand to the Lender the amount of any and
all out-of-pocket expenses, including the reasonable fees and expenses of its
counsel and of any experts or agents, which the Lender may reasonably incur in
connection with (i) the administration of this Agreement, (ii) the custody or
preservation of, or the sale of, collection from, or other realization upon, any
of the Collateral, (iii) the exercise or enforcement of any of the rights of the
Lender hereunder, or (iv) the failure by any Grantor to perform or observe any
of the provisions hereof.
 
(b) Without limiting the foregoing, each Grantor agrees to pay, and to save the
Lender and the Security Beneficiaries harmless from, and to indemnify them
against, any and all liabilities with respect to, or resulting from any delay in
paying, any and all stamp, excise, sales or other taxes which may be payable or
determined to be payable with respect to any of the Collateral or in connection
with any of the transactions contemplated by this Agreement. Any such amounts
payable as provided hereunder shall be additional Grantor Obligations secured by
this Agreement and the other Loan Documents to which the Grantors are a party.
Each Grantor further agrees to pay, and to save the Lender and the Security
Beneficiaries harmless from, and to indemnify them against, any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever with respect
to the execution, delivery, enforcement, performance and administration of this
Agreement, or arising out of or relating to the Lender's or any Security
Beneficiary's relationship with such Grantor hereunder or under any other Loan
Document.
 
Section 9.5. Binding Agreement; Assignments. This Agreement, and the terms,
covenants and conditions hereof, shall be binding upon and inure to the benefit
of the parties hereto and their respective successors and permitted assigns,
except that no Grantor shall be permitted to assign this Agreement or any
interest herein.
 
Section 9.6. Governing Law. This Agreement shall be governed by and construed in
accordance with the domestic laws of the State of Florida, without giving effect
to any choice of law or conflict of law provision or rule (whether of the State
of Florida or any other jurisdiction) that would cause the application of the
laws of any jurisdiction other than the State of Florida.

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Section 9.7. Severability. In case any one or more of the provisions contained
in this Agreement should be invalid, illegal or unenforceable in any respect, no
party hereto shall be required to comply with such provision for so long as such
provision is held to be invalid, illegal or unenforceable and the validity,
legality and enforceability of the remaining provisions contained herein shall
not in any way be affected or impaired. The parties shall endeavor in good-faith
negotiations to replace the invalid, illegal and unenforceable provisions with
valid provisions, the economic effect of which comes as close as possible to
that of the invalid, illegal or unenforceable provisions.
 
Section 9.8. Section Headings; Interpretation. Section headings used herein are
for convenience only and are not to affect the construction of, or to be taken
into consideration in interpreting, this Agreement. The use of the word
"including" or any variation or derivative thereof in this Agreement is by way
of example rather than by limitation. The language used in this Agreement will
be deemed to be the language chosen, by the Lender and the Grantors to express
their mutual intent. In the event an ambiguity or question of intent or
interpretation arises, this Agreement will be construed as if drafted jointly by
the Grantors and the Lender, and no presumption or burden of proof will arise
favoring or disfavoring any Person by virtue of the authorship of any of the
provisions of this Agreement.
 
Section 9.9. Counterparts. This Agreement may be authenticated in two or more
counterparts, each of which shall constitute an original, but all of which, when
taken together, shall constitute but one instrument, and any of the parties
hereto may authenticate this Agreement by signing any such counterpart. This
Agreement may be authenticated by manual signature, facsimile or, if approved in
writing by the Lender and the Grantors, electronic means, all of which shall be
equally valid.
 
Section 9.10. Termination.
 
(a) At such time as all of the Grantor Obligations (other than any indemnity and
similar obligations which expressly survive termination of this Agreement and
are not then due and payable) have been paid irrevocably and in full, this
Agreement and all obligations (other than those expressly stated to survive such
termination) of the Lender and the Grantors shall terminate, and the Collateral
shall be released from the Security Interests created hereby, all without
delivery of any instrument or performance of any act by any party, and all
rights to the Collateral shall revert to the Grantors. At the request and sole
expense of the Grantors following any such termination, the Lender shall deliver
to each Grantor any Collateral of such Grantor then held by the Lender hereunder
and shall execute and deliver to such Grantor or authorize the filing of but
without recourse to or warranty by the Lender, such Uniform Commercial Code
termination statements and similar documents prepared by such Grantor which such
Grantor shall reasonably request to evidence the release of the Collateral from
the security constituted hereby.
 
(b) Notwithstanding anything to the contrary contained in this Agreement, this
Agreement shall remain in full force and effect and continue to be effective
should any petition be filed by or against any Grantor for liquidation or
reorganization, should any Grantor become insolvent or make are assignment for
any benefit of creditors or should a receiver or trustee be appointed for all or
any significant part of any Grantor's assets, and shall continue to be effective

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or be reinstated, as the case may be, if at any time payment and performance of
the Grantor Obligations, or any part thereof, is, pursuant to applicable law,
rescinded or reduced in amount, or must otherwise be restored or returned by any
obligee of the Grantor Obligations, whether as a "voidable preference,"
"fraudulent conveyance" or otherwise, all as though such payment, or any part
thereof, had not been made.
 
(c) Notwithstanding anything in this Security Agreement to the contrary, the
Grantors may, to the extent permitted by the Facility Letters sell, assign,
transfer or otherwise dispose of any Collateral. In addition, the Collateral
shall be subject to release from time to time (with the Collateral referred to
in the immediately preceding sentence, the "Released Collateral") in accordance
with the facility Letters. The Liens under this Security Agreement shall
terminate with respect to the Released Collateral (other than Released
Collateral that is sold, assigned, transferred or otherwise disposed to a
Grantor or any other Guarantor) upon such sale, transfer, assignment,
disposition or release, and upon the written request of the Grantor, the Lender
shall execute and deliver such instrument or document as may be necessary to
release the Liens granted hereunder; provided, however, that (i) the Lender
shall not be required to execute any such documents on terms which, in the
Lender's opinion, would expose the Lender to liability or create any obligation
or entail any consequence other than the release of such Liens without recourse
or warranty, and (ii) such release shall not in any manner discharge, affect or
impair the Grantor Obligations or any Liens on (or obligations of any Grantor in
respect of all interests retained by any Grantor, including without limitation,
the proceeds of any sale, all of which shall continue to constitute part of the
Collateral unless and until applied strictly in accordance with the Loan
Documents.
 
Section 9.11. CONSENT TO JURISDICTION AND SERVICE OF PROCESS. ALL JUDICIAL
PROCEEDINGS BROUGHT AGAINST ANY GRANTOR WITH RESPECT TO THIS AGREEMENT MAY BE
BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT JURISDICTION IN MIAMI,
FLORIDA AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT EACH GRANTOR ACCEPTS FOR
ITSELF AND IN CONNECTION WITH ITS PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE
NONEXCLUSIVE JURISDICTION OF THE AFORESAID COURTS, AND IRREVOCABLY AGREES TO BE
BOUND BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION WITH THIS AGREEMENT. TO THE
EXTENT PERMITTED BY LAW, EACH GRANTOR AND THE AGENT ON BEHALF OF ITSELF AND EACH
OF THE LENDERS HEREBY AGREES THAT SERVICE UPON IT BY CERTIFIED MAIL SHALL
CONSTITUTE SUFFICIENT NOTICE AND SERVICE OF PROCESS. NOTHING HEREIN SHALL AFFECT
THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR SHALL LIMIT
THE RIGHT OF THE AGENT TO BRING PROCEEDINGS AGAINST ANY GRANTOR IN THE COURTS OF
ANY OTHER JURISDICTION.
 
Section 9.12. WAIVER OF JURY TRIAL. EACH GRANTOR AND THE AGENT, ON BEHALF OF
ITSELF AND EACH OF THE LENDERS, EACH HEREBY IRREVOCABLY WAIVES, TO THE EXTENT
PERMITTED BY APPLICABLE LAW, TRIAL BY JURY IN ANY LITIGATION IN ANY COURT WITH
RESPECT TO, IN CONNECTION WITH, OR ARISING OUT OF THIS AGREEMENT, OR THE
VALIDITY, PROTECTION, INTERPRETATION, COLLECTION OR ENFORCEMENT HEREOF; AND EACH
GRANTOR HEREBY WAIVES, TO THE EXTENT PERMITTED BY APPLICABLE

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LAW, THE RIGHT TO INTERPOSE ANY SET OFF OR COUNTERCLAIM OR CROSS-CLAIM IN
CONNECTION WITH ANY SUCH LITIGATION, IRRESPECTIVE OF THE NATURE OF SUCH SETOFF,
COUNTERCLAIM OR CROSS-CLAIM EXCEPT TO THE EXTENT THAT THE FAILURE SO TO ASSERT
ANY SUCH SETOFF, COUNTERCLAIM OR CROSS-CLAIM WOULD PERMANENTLY PRECLUDE THE
PROSECUTION OF OR RECOVERY UPON SAME, Notwithstanding anything contained In this
Agreement to the contrary, no claim may be made by any Grantor against the
Lender or any Security Beneficiary for any lost profits or any special, indirect
or consequential damages in respect of any breach or wrongful conduct (other
than willful misconduct or actual fraud) in connection with, arising out of or
in any way related to the transactions contemplated hereunder, or any act,
omission or event occurring in connection therewith; and each Grantor hereby
waives, releases and agrees not to sue upon any such claim for any such damages.
EACH GRANTOR AGREES THAT THIS SECTION IS A SPECIFIC AND MATERIAL ASPECT OF THIS
AGREEMENT AND ACKNOWLEDGES THAT THE LENDERS WOULD NOT EXTEND TO THE GRANTORS THE
FACILITIES UNDER THE FACILITIES LETTERS IF THIS SECTION WERE NOT PART OF THIS
AGREEMENT.
 
Section 9.13. Notices.
 
All notices and other communications provided for hereunder shall be in writing
(including telegraphic or telecopier communication) and mailed, telegraphed,
telecopied or delivered to the address set forth in the Facilities Letters or to
such other address and/or with such other copy or copies as the intended
recipient may have specified by prior notice to the notifying party. All such
notices and other communications shall, when mailed, telegraphed, telecopied or
telexed, be effective when deposited in the mails, delivered to the telegraph
company or telecopied and confirmed by answerback, respectively, addressed as
aforesaid; except that notices and other communications to the Lender shall not
be effective until received by the Lender. Delivery by telecopier of an executed
counterpart of any amendment or waiver or any provision of any Loan Document
shall be effective as delivery of an original executed counterpart thereof.
 
Section 9.14. Acknowledgements. Each Grantor acknowledges that: (a) it has been
advised by counsel in the negotiation, execution and delivery of this Agreement
and the other Loan Documents; (b) neither the Lender, any other Lender nor any
Security Beneficiary has any fiduciary relationship with or duty to any Grantor
arising out of or in connection with this Agreement or any of the other Loan
Documents, and the relationship between each Grantor, on the one hand, and the
Lender, each other Lender and the other Security Beneficiaries, on the other
hand, in connection herewith or therewith is solely that of debtor and creditor;
and (c) no joint venture is created hereby or by the Loan Documents or otherwise
exists by virtue of the transactions contemplated hereby among the Security
Beneficiaries or among any Grantor and the Security Beneficiaries.

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IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of
the date first above written.
 
GRANTORS:
 
SIMCLAR, INC.
 
 
By:  /s/ Barry J. Pardon

--------------------------------------------------------------------------------

Name:  Barry J. Pardon
Title:  President
     
SIMCLAR (MEXICO) INC.
 
 
By:  /s/ Barry J. Pardon

--------------------------------------------------------------------------------

Name:  Barry J. Pardon
Title:  President
     
SIMCLAR DE MEXICO, S.A. DE C.V.
 
 
By:  /s/ Barry J. Pardon

--------------------------------------------------------------------------------

Name:  Barry J. Pardon
Title:  President
     
SIMCLAR INTERCONNECT TECHNOLOGIES INC.
 
 
By:  /s/ Barry J. Pardon

--------------------------------------------------------------------------------

Name:  Barry J. Pardon
Title:  President
     
SIMCLAR (NORTH AMERICA)
 
 
By:  /s/ Barry J. Pardon

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Name:  Barry J. Pardon
Title:  President

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STATE OF FLORIDA
)
 
) ss:
COUNTY OF MIAMI-DADE
)
   

The foregoing instrument was acknowledged before me this 28th day of February,
2007, by Barry J. Pardon as President of Simclar, Inc., a Florida corporation
(the "Borrower"), and before me executed the attached Third Amended and Restated
Security Agreement dated February 28, 2007, on behalf of the Borrower.
 
 
/s/ Roxana L. Alvarez

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NOTARY PUBLIC
 
[Stamp]

--------------------------------------------------------------------------------

(Print, Type or Stamp Commissioned Name of Notary Public)
 
STATE OF FLORIDA
)
 
) ss:
COUNTY OF MIAMI-DADE
)
   

The foregoing instrument was acknowledged before me this 28th day of February,
2007, by Barry J. Pardon as President of Simclar (Mexico) Inc., an Illinois
corporation (the "Borrower"), and before me executed the attached Third Amended
and Restated Security Agreement dated February 28, 2007, on behalf of the
Borrower.
 
 
/s/ Roxana L. Alvarez

--------------------------------------------------------------------------------

NOTARY PUBLIC
 
[Stamp]

--------------------------------------------------------------------------------

(Print, Type or Stamp Commissioned Name of Notary Public)
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STATE OF FLORIDA
)
 
) ss:
COUNTY OF MIAMI-DADE
)
   

The foregoing instrument was acknowledged before me this 28th day of February,
2007, by Barry J. Pardon as President of Simclar Interconnect Technologies,
Inc., a Delaware corporation (the "Borrower"), and before me executed the
attached Third Amended and Restated Security Agreement dated February 28, 2007,
on behalf of the Borrower.
 
 
/s/ Roxana L. Alvarez

--------------------------------------------------------------------------------

NOTARY PUBLIC
 
 
[Stamp]

--------------------------------------------------------------------------------

(Print, Type or Stamp Commissioned Name of Notary Public)
 
STATE OF FLORIDA
)
 
) ss:
COUNTY OF MIAMI-DADE
)
   

The foregoing instrument was acknowledged before me this 28th day of February,
2007, by Barry J. Pardon as President of Simclar Mexico, S.A. de C.V. (the
"Borrower"), and before me executed the attached Third Amended and Restated
Security Agreement dated February 28, 2007, on behalf of the Borrower.
 
 
/s/ Roxana L. Alvarez

--------------------------------------------------------------------------------

NOTARY PUBLIC
 
 
[Stamp]

--------------------------------------------------------------------------------

(Print, Type or Stamp Commissioned Name of Notary Public)
 
STATE OF FLORIDA
)
 
) ss:
COUNTY OF MIAMI-DADE
)
   

The foregoing instrument was acknowledged before me this 28th day of February,
2007, by Barry J. Pardon as President of Simclar (North America), a North
Carolina corporation (the "Borrower"), and before me executed the attached Third
Amended and Restated Security Agreement dated February 28, 2007, on behalf of
the Borrower.
 
 
/s/ Roxana L. Alvarez

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NOTARY PUBLIC
 
 
[Stamp]

--------------------------------------------------------------------------------

(Print, Type or Stamp Commissioned Name of Notary Public)
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LENDER:
 
EXECUTED and DELIVERED
for and on behalf of THE GOVERNOR
AND COMPANY OF THE BANK OF 
SCOTLAND in the presence
of:-                                                                                  
/s/ Peter Gordon

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Authorized Signatory
 
/s/ Douglas A. Archibald            Witness
 
Doublas A. Archibald                  Full Name
 
Bank of Scotland                           Address
 
Edinburgh
 
 
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