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Exhibit 10.3
 
SECURITY AGREEMENT
 
This SECURITY AGREEMENT (the “Security Agreement”) dated as of October 31, 2013,
but made effective as of December 2, 2013, is executed by and among DR. TATTOFF,
INC., a Florida corporation (the “Issuing Borrower”), DRTHC I, LLC, a Delaware
limited liability company, and DRTHC II, LLC, a Delaware limited liability
company (each of the foregoing, including the Issuing Borrower, hereinafter
sometimes individually referred to as a “Debtor” and all such entities sometimes
hereinafter collectively referred to as “Debtors”), with their chief executive
offices located at 8500 Wilshire Blvd., Suite 105, Beverly Hills, CA 90211, and
TCA Global Credit Master Fund, LP (the “Secured Party”).
 
R E C I T A L S:
 
WHEREAS, Debtors desire to borrow funds and obtain financial accommodations from
Secured Party pursuant to that certain Credit Agreement of even date herewith
among Debtors and Secured Party (the “Credit Agreement”).
 
NOW, THEREFORE, in consideration of the credit extended now and in the future by
Secured Party to the Debtors and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, Debtors and Secured
Party hereby agree as follows:
 
A G R E E M E N T S:
 
1             DEFINITIONS.
 
1.1          Defined Terms.  Capitalized terms used but not otherwise defined in
this Security Agreement (including the Recitals) shall have the meanings
ascribed to them in the Credit Agreement.  For the purposes of this Security
Agreement, the following capitalized words and phrases shall have the meanings
set forth below.
 
                                   (a)           “Capital Securities” shall
mean, with respect to any Person, all shares, interests, participations or other
equivalents (however designated, whether voting or non-voting) of such Person’s
capital, whether now outstanding or issued or acquired after the date hereof,
including common shares, preferred shares, membership interests in a limited
liability company, limited or general partnership interests in a partnership or
any other equivalent of such ownership interest.
 
   (b)           “Collateral” shall have the meaning set forth in Section 2.1
hereof.
 
   (c)           “Obligor” shall mean, collectively, each Debtor, or any other
party liable with respect to the Obligations.
 
   (d)           “Organizational Identification Number” means, with respect to
each Debtor, the organizational identification number assigned to such Debtor by
the applicable governmental unit or agency of the jurisdiction of organization
of such Debtor, if any.
 

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   (e)           “Taxes” shall mean any and all present and future taxes,
duties, levies, imposts, deductions, assessments, charges or withholdings, and
any and all liabilities (including interest and penalties and other additions to
taxes) with respect to the foregoing.
 
   (f)            “Unmatured Event of Default” shall mean any event which, with
the giving of notice, the passage of time or both, would constitute an Event of
Default.
 
                    1.2          Other Terms Defined in UCC.  All other
capitalized words and phrases used herein and not otherwise specifically defined
herein or in the Credit Agreement shall have the respective meanings assigned to
such terms in the UCC, to the extent the same are used or defined therein.
 
1.3          Other Interpretive Provisions.
 
  (a)           The meanings of defined terms are equally applicable to the
singular and plural forms of the defined terms.  Whenever the context so
requires, the neuter gender includes the masculine and feminine, the single
number includes the plural, and vice versa, and in particular the word “Debtor”
or “Debtors” shall be so construed.
 
  (b)           Section and Schedule references are to this Security Agreement
unless otherwise specified.  The words “hereof”, “herein” and “hereunder” and
words of similar import when used in this Security Agreement shall refer to this
Security Agreement as a whole and not to any particular provision of this
Security Agreement
 
   (c)           The term “including” is not limiting, and means “including,
without limitation”.
 
                                   (d)           In the computation of periods
of time from a specified date to a later specified date, the word “from” means
“from and including”; the words “to” and “until” each mean “to but excluding”,
and the word “through” means “to and including”.
 
                                  (e)           Unless otherwise expressly
provided herein: (i) references to agreements (including this Security Agreement
and the other Loan Documents) and other contractual instruments shall be deemed
to include all subsequent amendments, restatements, supplements and other
modifications thereto, but only to the extent such amendments, restatements,
supplements and other modifications are not prohibited by the terms of any Loan
Document; and (ii) references to any statute or regulation shall be construed as
including all statutory and regulatory provisions amending, replacing,
supplementing or interpreting such statute or regulation.
 
                                (f)           To the extent any of the
provisions of the other Loan Documents are inconsistent with the terms of this
Security Agreement, the provisions of this Security Agreement shall govern.
 
                                 (g)           This Security Agreement and the
other Loan Documents may use several different limitations, tests or
measurements to regulate the same or similar matters.  All such limitations,
tests and measurements are cumulative and each shall be performed in accordance
with its terms.
 

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                                   (h)           The term “Debtor” or “Debtors”
shall refer collectively to each Debtor individually, and to all Debtors,
collectively, and any Subsidiaries of any of them now or hereafter in existence,
in each case as the context may so require, it being the intent of the parties
under this Agreement that all of the terms, conditions, provisions and
representations hereof shall, to the greatest extent possible, apply equally to
each Debtor, and any Subsidiaries of any of them now or hereafter in existence,
as if each term, covenant, provision and representation was separately made
herein by each Debtor.
 
2             SECURITY FOR THE OBLIGATIONS.
 
                    2.1          Security for Obligations.  As security for the
payment and performance of the Obligations, each Debtor does hereby pledge,
assign, transfer, deliver and grant to Secured Party, for its own benefit and as
agent for its Affiliates, a continuing and unconditional first priority security
interest in and to any and all property of such Debtor, of any kind or
description, tangible or intangible, wheresoever located and whether now
existing or hereafter arising or acquired, including the following (all of which
property for each Debtor, along with the products and proceeds therefrom, are
individually and collectively referred to as the “Collateral”):
 
                                   (a)          all property of, or for the
account of, such Debtor now or hereafter coming into the possession, control or
custody of, or in transit to, Secured Party or any agent or bailee for Secured
Party or any parent, affiliate or subsidiary of Secured Party or any participant
with Secured Party in the Obligations (whether for safekeeping, deposit,
collection, custody, pledge, transmission or otherwise), including all cash,
earnings, dividends, interest, or other rights in connection therewith and the
products and proceeds therefrom, including the proceeds of insurance thereon;
and
 
                                 (b)           the additional property of such
Debtor, whether now existing or hereafter arising or acquired, and wherever now
or hereafter located, together with all additions and accessions thereto,
substitutions, betterments and replacements therefor, products and Proceeds
therefrom, and all of such Debtor’s books and records and recorded data relating
thereto (regardless of the medium of recording or storage), together with all of
such Debtor’s right, title and interest in and to all computer software required
to utilize, create, maintain and process any such records or data on electronic
media, identified and set forth as follows:
 
                                              (i)            All Accounts and
all goods whose sale, lease or other disposition by such Debtor has given rise
to Accounts and have been returned to, or repossessed or stopped in transit by,
such Debtor, or rejected or refused by any Customer;
 
   (ii)           All Inventory, including raw materials, work-in-process and
finished goods;
 
   (iii)          All goods (other than Inventory), including embedded software,
Equipment, vehicles, furniture and Fixtures;
 
   (iv)          All Software and computer programs;
 

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  (v)         All Securities, Investment Property, Financial Assets and Deposit
Accounts, specifically including the Lock Box Account, and all funds at any time
deposited therewith;
 
   (vi)          All As-Extracted Collateral, Commodity Accounts, Commodity
Contracts, and Farm Products;
 
  (vii)         All Chattel Paper, Electronic Chattel Paper, Instruments,
Documents, Letter of Credit Rights, all proceeds of letters of credit,
Health-Care-Insurance Receivables, Supporting Obligations, notes secured by real
estate, Commercial Tort Claims and General Intangibles, including Payment
Intangibles; and
 
   (viii)        All real estate property owned by Debtor and the interest of
Debtor in fixtures related to such real property;
 
   (ix)          All Proceeds (whether Cash Proceeds or Non-cash Proceeds) of
the foregoing property, including all insurance policies and proceeds of
insurance payable by reason of loss or damage to the foregoing property,
including unearned premiums, and of eminent domain or condemnation awards.
 
                    2.2          Possession and Transfer of Collateral.  Until
an Event of Default has occurred, but subject to Secured Party’s rights under
the Credit Agreement (specifically with respect to Secured Party’s rights to use
and apply money in the Lock Box Account) each Debtor shall be entitled to
possession and use of the Collateral (other than Instruments or Documents
(including Tangible Chattel Paper and Investment Property consisting of
certificated securities) and other Collateral required to be delivered to
Secured Party pursuant to this Section 2).  The cancellation or surrender of any
promissory note evidencing an Obligation, upon payment or otherwise, shall not
affect the right of Secured Party to retain the Collateral for any other of the
Obligations, except upon payment in full of the Obligations.  No Debtor shall
sell, assign (by operation of law or otherwise), license, lease or otherwise
dispose of, or grant any option with respect to any of the Collateral, except as
permitted pursuant to the Credit Agreement.
 
                    2.3          Financing Statements.  Each Debtor authorizes
Secured Party to prepare and file such financing statements, amendments and
other documents and do such acts as Secured Party deems necessary in order to
establish and maintain valid, attached and perfected, first priority security
interests in the Collateral in favor of Secured Party, for its own benefit and
as agent for its Affiliates, free and clear of all Liens and claims and rights
of third parties whatsoever, except Permitted Liens.  Each Debtor hereby
irrevocably authorizes Secured Party at any time, and from time to time, to file
in any jurisdiction any initial financing statements and amendments thereto
that: (a) indicate the Collateral: (i) is comprised of all assets of such Debtor
(or words of similar effect), regardless of whether any particular asset
comprising a part of the Collateral falls within the scope of Article 9 of the
UCC of the jurisdiction wherein such financing statement or amendment is filed;
or (ii) as being of an equal or lesser scope or within greater detail as the
grant of the security interest set forth herein; and (b) contain any other
information required by Section 5 of Article 9 of the UCC of the jurisdiction
wherein such financing statement or amendment is filed regarding the sufficiency
or filing office acceptance of any financing statement or amendment, including:
(A) whether such Debtor is an organization, the type of organization and any
Organizational Identification Number issued to such Debtor; and (B) in the case
of a financing statement filed as a fixture filing or indicating Collateral as
as-extracted collateral or timber to be cut, a sufficient description of the
real property to which the Collateral relates.  Each Debtor agrees to furnish
any such information to Secured Party promptly upon request.  In addition, each
Debtor shall make appropriate entries on its books and records disclosing the
security interests of Secured Party, for its own benefit and as agent for its
Affiliates, in the Collateral.  Each Debtor hereby agrees that a photogenic or
other reproduction of this Security Agreement is sufficient for filing as a
financing statement and each Debtor authorizes Secured Party to file this
Security Agreement as a financing statement in any jurisdiction.
 

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                    2.4          Preservation of the Collateral.  Secured Party
may, but is not required to, take such actions from time to time as Secured
Party deems appropriate to maintain or protect the Collateral. Secured Party
shall have exercised reasonable care in the custody and preservation of the
Collateral if Secured Party takes such action as any Debtor shall reasonably
request in writing which is not inconsistent with Secured Party’s status as a
secured party, but the failure of Secured Party to comply with any such request
shall not be deemed a failure to exercise reasonable care; provided, however,
Secured Party’s responsibility for the safekeeping of the Collateral shall: (i)
be deemed reasonable if such Collateral is accorded treatment substantially
equal to that which Secured Party accords its own property; and (ii) not extend
to matters beyond the control of Secured Party, including acts of God, war,
insurrection, riot or governmental actions.  In addition, any failure of Secured
Party to preserve or protect any rights with respect to the Collateral against
prior or third parties, or to do any act with respect to preservation of the
Collateral, not so requested by a Debtor, shall not be deemed a failure to
exercise reasonable care in the custody or preservation of the Collateral.  Each
Debtor shall have the sole responsibility for taking such action as may be
necessary, from time to time, to preserve all rights of such Debtor and Secured
Party in the applicable Collateral against prior or third parties.  Without
limiting the generality of the foregoing, where Collateral consists, in whole or
in part, of Capital Securities, each Debtor represents to, and covenants with,
Secured Party that such Debtor has made arrangements for keeping informed of
changes or potential changes affecting the Capital Securities (including rights
to convert or subscribe, payment of dividends, reorganization or other
exchanges, tender offers and voting rights), and each Debtor agrees that Secured
Party shall have no responsibility or liability for informing such Debtor of any
such or other changes or potential changes or for taking any action or omitting
to take any action with respect thereto.
 
                    2.5          Other Actions as to any and all
Collateral.  Each Debtor further agrees to take any other action reasonably
requested by Secured Party to ensure the attachment, perfection and first
priority of, and the ability of Secured Party to enforce, the security interest
of Secured Party, for its own benefit and as agent for its Affiliates, in any
and all of the Collateral, including: (i) causing Secured Party’s name to be
noted as secured party on any certificate of title for a titled good if such
notation is a condition to attachment, perfection or priority of, or ability of
the bank to enforce, the security interest of Secured Party, for its own benefit
and as agent for its Affiliates, in such Collateral; (ii) complying with any
provision of any statute, regulation or treaty of the United States as to any
material portion of the Collateral as soon as possible but not more than
forty-five (45) days after such request if compliance with such provision is a
condition to attachment, perfection or priority of, or ability of Secured Party
to enforce, the security interest of Secured Party, for its own benefit and as
agent for its Affiliates, in such Collateral; (iii) obtaining governmental and
other third party consents and approvals, including, without limitation, any
consent of any licensor, lessor or other Person with authority or control over
or an interest in any material portion of the Collateral as soon as possible but
not more than forty-five (45) days after such request; (iv) obtaining waivers
from mortgagees and landlords in form and substance reasonably satisfactory to
Secured Party which affect any material portion of the Collateral as soon as
possible but not more than forty-five (45) days after such request; and (v)
taking all actions required by the UCC in effect from time to time or by other
law, as applicable in any relevant UCC jurisdiction, or by other law as
applicable in any foreign jurisdiction.  Each Debtor further agrees to indemnify
and hold Secured Party harmless against claims of any Persons not a party to
this Security Agreement concerning disputes arising over the Collateral, except
to the extent resulting from the gross negligence or willful misconduct of
Secured Party or its Affiliates.
 

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                    2.6         Collateral in the Possession of a Warehouseman
or Bailee.  If any material portion of the Collateral at any time is in the
possession of a warehouseman or bailee, each Debtor shall promptly notify
Secured Party thereof, and, as soon as possible, but not more than forty-five
(45) days later, shall obtain a Collateral Access Agreement in form and
substance reasonably satisfactory to Secured Party from such warehouseman or
bailee.
 
                    2.7          Letter-of-Credit Rights.  If any Debtor at any
time is a beneficiary under a letter of credit now or hereafter issued in favor
of such Debtor, such Debtor shall promptly notify Secured Party thereof and, at
the request and option of Secured Party, such Debtor shall, pursuant to an
agreement in form and substance reasonably satisfactory to Secured Party,
either: (i) arrange for the issuer and any confirmer of such letter of credit to
consent to an assignment to Secured Party, for its own benefit and as agent for
its Affiliates, of the proceeds of any drawing under the letter of credit; or
(ii) arrange for Secured Party, for its own benefit and as agent for its
Affiliates, to become the transferee beneficiary of the letter of credit, with
Secured Party agreeing, in each case, that the proceeds of any drawing under the
letter to credit are to be applied as provided in the Credit Agreement.
 
                    2.8          Commercial Tort Claims.  If any Debtor shall at
any time hold or acquire a Commercial Tort Claim, such Debtor shall promptly
notify Secured Party in writing signed by such Debtor of the details thereof and
grant to Secured Party, for its own benefit and as agent for its Affiliates, in
such written notice or other written instrument, a security interest therein and
in the proceeds thereof, all upon the terms of this Security Agreement, in each
case in form and substance reasonably satisfactory to Secured Party, and shall
execute any amendments hereto deemed reasonably necessary by Secured Party to
perfect the security interest of Secured Party, for its own benefit and as agent
for its Affiliates, in such Commercial Tort Claim.
 
                    2.9          Electronic Chattel Paper and Transferable
Records.  If any Debtor at any time holds or acquires an interest in any
electronic chattel paper or any “transferable record”, as that term is defined
in Section 201 of the federal Electronic Signatures in Global and National
Commerce Act, or in Section 16 of the Uniform Electronic Transactions Act as in
effect in any relevant jurisdiction, such Debtor shall promptly notify Secured
Party thereof and, at the request of Secured Party, shall take such action as
Secured Party may reasonably request to vest in Secured Party control under
Section 9-105 of the UCC of such electronic chattel paper or control under
Section 201 of the federal Electronic Signatures in Global and National Commerce
Act or, as the case may be, Section 16 of the Uniform Electronic Transactions
Act, as so in effect in such jurisdiction, of such transferable record.  Secured
Party agrees with each Debtor that Secured Party will arrange, pursuant to
procedures reasonably satisfactory to Secured Party and so long as such
procedures will not result in Secured Party’s loss of control, for such Debtor
to make alterations to the electronic chattel paper or transferable record
permitted under Section 9-105 of the UCC or, as the case may be, Section 201 of
the federal Electronic Signatures in Global and National Commerce Act or Section
16 of the Uniform Electronic Transactions Act, for a party in control to make
without loss of control.
 

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                    2.10        Additional Requirements on Collateral.  Each
Debtor shall fully cooperate with Secured Party to obtain and keep in effect one
or more control agreements in Deposit Accounts, Electronic Chattel Paper,
Investment Property and Letter-of-Credit Rights Collateral.  Such control
agreements shall only be required if, in the reasonable discretion of the
Secured Party, the nature of the Collateral requires any such control agreements
in order for the Secured Party to perfect its security interests in any
Collateral as granted hereunder, and in such event, each Debtor shall promptly
provide any such control agreements upon request from the Secured Party. In
addition, each Debtor, at the Debtor’s expense, shall promptly: (A) execute all
notices of security interest for each relevant type of Software and other
General Intangibles in forms suitable for filing with any United States or
foreign office handling the registration or filing of patents, trademarks,
copyrights and other intellectual property and any successor office or agency
thereto; and (B) take all commercially reasonable steps in any hearing, suit,
action, or other proceeding before any such office or any similar office or
agency in any other country or any political subdivision thereof, to diligently
prosecute or maintain, as applicable, each application and registration of any
Software, General Intangibles or any other intellectual property rights and
assets that are part of the Collateral, including filing of renewals, affidavits
of use, affidavits of incontestability and opposition, interference and
cancellation proceedings.
 
3             REPRESENTATIONS AND WARRANTIES.
 
Each Debtor makes the following representations and warranties to Secured Party:
 
                    3.1          Debtor Organization and Name. Each Debtor is a
corporation or other legally recognized form of entity, as applicable, duly
organized, existing and in good standing under the laws of its State or country
of organization, with full and adequate power to carry on and conduct its
business as presently conducted.  Each Debtor is duly licensed or qualified in
all foreign jurisdictions wherein the nature of its activities requires such
qualification or licensing.  Each Debtor’s Organizational Identification Number
is set forth in the Credit Agreement.  The exact legal name of each Debtor is as
set forth in the first paragraph of this Security Agreement, and no Debtor
currently conducts, nor has it during the last five (5) years conducted,
business under any other name or trade name.
 
                    3.2          Authorization.  Each Debtor has full right,
power and authority to enter into this Security Agreement and to perform all of
its duties and obligations under this Security Agreement.  The execution and
delivery of this Security Agreement and the other Loan Documents will not, nor
will the observance or performance of any of the matters and things herein or
therein set forth, violate or contravene any provision of law or of the articles
of incorporation, by-laws, operating agreement or other governing documents, as
applicable, of each Debtor.  All necessary and appropriate action has been taken
on the part of each Debtor to authorize the execution and delivery of this
Security Agreement.
 

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                    3.3          Validity and Binding Nature.  This Security
Agreement is the legal, valid and binding obligation of each Debtor, enforceable
against each Debtor in accordance with its terms, subject to bankruptcy,
insolvency and similar laws affecting the enforceability of creditors’ rights
generally and to general principles of equity.
 
                    3.4          Consent; Absence of Breach.  The execution,
delivery and performance of this Security Agreement and any other documents or
instruments to be executed and delivered by each Debtor in connection herewith,
do not and will not: (a) require any consent, approval, authorization, or
filings with, notice to or other act by or in respect of, any governmental
authority or any other Person (other than filings or notices pursuant to federal
or state securities laws or other than any consent or approval which has been
obtained and is in full force and effect); (b) conflict with: (i) any provision
of law or any applicable regulation, order, writ, injunction or decree of any
court or governmental authority; (ii) the articles of incorporation, bylaws,
operating agreement, or other organic or governance document applicable to each
Debtor; or (iii) any agreement, indenture, instrument or other document, or any
judgment, order or decree, which is binding upon each applicable Debtor or any
of its properties or assets; or (c) require, or result in, the creation or
imposition of any Lien on any asset of any Debtor, other than Liens in favor of
Secured Party created pursuant to this Security Agreement and Permitted Liens.
 
                    3.5          Ownership of Collateral; Liens.  Each Debtor is
the sole owner of all the Collateral applicable to such Debtor, free and clear
of all Liens, charges and claims (including infringement claims with respect to
patents, trademarks, service marks, copyrights and other intellectual property
rights), other than Permitted Liens.
 
                    3.6          Adverse Circumstances.  Except as disclosed in
the Credit Agreement, no condition, circumstance, event, agreement, document,
instrument, restriction, litigation or proceeding (or threatened litigation or
proceeding or basis therefor) exists which: (i) would have a Material Adverse
Effect upon any Debtor; or (ii) would constitute an Event of Default or an
Unmatured Event of Default.
 
                    3.7          Security Interest.  This Security Agreement
creates a valid security interest in favor of Secured Party in the Collateral
and, when properly perfected by filing in the appropriate jurisdictions, or by
possession or control of such Collateral by Secured Party or delivery of such
Collateral to Secured Party, shall constitute a valid, perfected, first-priority
security interest in such Collateral, subject, however, to Permitted Liens.
 
                    3.8          Place of Business.  The principal place of
business and books and records of each Debtor is set forth in the preamble to
this Security Agreement, and the location of all Collateral, if other than at
such principal place of business, is as set forth in the Credit Agreement, and
each Debtor shall promptly notify Secured Party of any change in such
locations.  No Debtor will remove or permit the Collateral to be removed from
such locations without the prior written consent of Secured Party, except as
permitted pursuant to the Credit Agreement.
 

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                    3.9          Complete Information.  This Security Agreement
and all financial statements, schedules, certificates, confirmations,
agreements, contracts, and other materials and information heretofore or
contemporaneously herewith furnished in writing by any Debtor to Secured Party
for purposes of, or in connection with, this Security Agreement and the
transactions contemplated hereby is, and all written information hereafter
furnished by or on behalf of any Debtor to Secured Party pursuant hereto or in
connection herewith will be, true and accurate in every material respect on the
date as of which such information is dated or certified, and none of such
information is or will be incomplete by omitting to state any material fact
necessary to make such information not misleading in light of the circumstances
under which made (it being recognized by Secured Party that any projections and
forecasts provided by any Debtor are based on good faith estimates and
assumptions believed by such Debtor to be reasonable as of the date of the
applicable projections or assumptions and that actual results during the period
or periods covered by any such projections and forecasts may differ from
projected or forecasted results).
 
4             REMEDIES.
 
Upon the occurrence of any default in the payment or performance of any of the
covenants, conditions and agreements contained in this Security Agreement or any
other Event of Default, Secured Party shall have all rights, powers and remedies
set forth in this Security Agreement or the other Loan Documents or in any other
written agreement or instrument relating to any of the Obligations or any
security therefor, as a secured party under the UCC or as otherwise provided at
law or in equity. Without limiting the generality of the foregoing, Secured
Party may, at its option upon the occurrence of an Event of Default, declare its
commitments to Debtors to be terminated and all Obligations to be immediately
due and payable, or, if provided in the Loan Documents, all commitments of
Secured Party to Debtors shall immediately terminate and all Obligations shall
be automatically due and payable, all without demand, notice or further action
of any kind required on the part of Secured Party.  Each Debtor hereby waives
any and all presentment, demand, notice of dishonor, protest, and all other
notices and demands in connection with the enforcement of Secured Party’s rights
under the Loan Documents, and hereby consents to, and waives notice of release,
with or without consideration, of any Collateral, notwithstanding anything
contained herein or in the Loan Documents to the contrary.  In addition to the
foregoing:
 
                    4.1          Possession and Assembly of Collateral.  Secured
Party may, without notice, demand or the initiation of legal process of any
kind, take possession of any or all of the Collateral (in addition to Collateral
of which Secured Party already has possession), wherever it may be found, and
for that purpose may pursue the same wherever it may be found, and may at any
time enter into any of Debtors’ premises where any of the Collateral may be or
is supposed to be, and search for, take possession of, remove, keep and store
any of the Collateral until the same shall be sold or otherwise disposed of and
Secured Party shall have the right to store and conduct a sale of the same in
any of Debtors’ premises without cost to Secured Party.  At Secured Party’s
request, each Debtor will, at such Debtor’s sole expense, assemble the
Collateral and make it available to Secured Party at a place or places to be
designated by Secured Party which is reasonably convenient to Secured Party and
Debtors.
 

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                    4.2          Sale of Collateral.  Secured Party may sell any
or all of the Collateral at public or private sale, upon such terms and
conditions as Secured Party may deem proper, and Secured Party may purchase any
or all of the Collateral at any such sale.  Each Debtor acknowledges that
Secured Party may be unable to effect a public sale of all or any portion of the
Collateral because of certain legal and/or practical restrictions and provisions
which may be applicable to the Collateral and, therefore, may be compelled to
resort to one or more private sales to a restricted group of offerees and
purchasers.  Each Debtor consents to any such private sale so made even though
at places and upon terms less favorable than if the Collateral were sold at
public sale.  Secured Party shall have no obligation to clean-up or otherwise
prepare the Collateral for sale.  Secured Party may apply the net proceeds,
after deducting all reasonable costs, expenses, attorneys’ and paralegals’ fees
incurred or paid at any time in the collection, protection and sale of the
Collateral and the Obligations, to the payment of the Obligations, returning the
excess proceeds, if any, to Debtors.  Each Debtor shall remain liable for any
amount remaining unpaid after such application, with interest at the Default
Rate.  Any notification of intended disposition of the Collateral required by
law shall be conclusively deemed reasonably and properly given if given by
Secured Party at least ten (10) calendar days before the date of such
disposition.  Each Debtor hereby confirms, approves and ratifies all acts and
deeds of Secured Party relating to the foregoing, and each part thereof, and
expressly waives any and all claims of any nature, kind or description which it
has or may hereafter have against Secured Party or its representatives, by
reason of taking, selling or collecting any portion of the Collateral.  Each
Debtor consents to releases of the Collateral at any time (including prior to
default) and to sales of the Collateral in groups, parcels or portions, or as an
entirety, as Secured Party shall deem appropriate.  Each Debtor expressly
absolves Secured Party from any loss or decline in market value of any
Collateral by reason of delay in the enforcement or assertion or non-enforcement
of any rights or remedies under this Security Agreement.
 
                    4.3          Standards for Exercising Remedies. To the
extent that applicable law imposes duties on Secured Party to exercise remedies
in a commercially reasonable manner, each Debtor acknowledges and agrees that it
is not commercially unreasonable for Secured Party: (i) to incur expenses deemed
necessary by Secured Party to prepare Collateral for disposition or otherwise to
complete raw material or work-in-process into finished goods or other finished
products for disposition; (ii) to fail to obtain third party consents for access
to Collateral to be disposed of, or to obtain or, if not required by other law,
to fail to obtain governmental or third party consents for the collection or
disposition of Collateral to be collected or disposed of; (iii) to fail to
exercise collection remedies against Customers or other Persons obligated on
Collateral or to remove liens or encumbrances on or any adverse claims against
Collateral; (iv) to exercise collection remedies against Customers and other
Persons obligated on Collateral directly or through the use of collection
agencies and other collection specialists; (v) to advertise dispositions of
Collateral through publications or media of general circulation, whether or not
the Collateral is of a specialized nature; (vi) to contact other Persons,
whether or not in the same business as Debtors, for expressions of interest in
acquiring all or any portion of the Collateral; (vii) to hire one or more
professional auctioneers to assist in the disposition of Collateral, whether or
not the Collateral is of a specialized nature; (viii) to dispose of Collateral
by utilizing internet sites that provide for the auction of assets of the types
included in the Collateral or that have the reasonable capability of doing so,
or that match buyers and sellers of assets; (ix) to dispose of assets in
wholesale rather than retail markets; (x) to disclaim disposition warranties,
including any warranties of title; (xi) to purchase insurance or credit
enhancements to insure Secured Party against risks of loss, collection or
disposition of Collateral or to provide to Secured Party a guaranteed return
from the collection or disposition of Collateral; or (xii) to the extent deemed
appropriate by Secured Party, to obtain the services of other brokers,
investment bankers, consultants and other professionals to assist Secured Party
in the collection or disposition of any of the Collateral.  Each Debtor
acknowledges that the purpose of this section is to provide non-exhaustive
indications of what actions or omissions by Secured Party would not be
commercially unreasonable in Secured Party’s exercise of remedies against the
Collateral and that other actions or omissions by Secured Party shall not be
deemed commercially unreasonable solely on account of not being indicated in
this Section.  Without limitation upon the foregoing, nothing contained in this
Section shall be construed to grant any rights to Debtors or to impose any
duties on Secured Party that would not have been granted or imposed by this
Security Agreement or by applicable law in the absence of this Section.
 

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                    4.4          UCC and Offset Rights.  Secured Party may
exercise, from time to time, any and all rights and remedies available to it
under the UCC or under any other applicable law in addition to, and not in lieu
of, any rights and remedies expressly granted in this Security Agreement or in
any other agreements between any Obligor and Secured Party, and may, without
demand or notice of any kind, appropriate and apply toward the payment of such
of the Obligations, whether matured or unmatured, including costs of collection
and attorneys’ and paralegals’ fees and costs, and in such order of application
as Secured Party may, from time to time, elect, any indebtedness of Secured
Party to any Obligor, however created or arising, including balances, credits,
deposits, accounts or moneys of such Obligor in the possession, control or
custody of, or in transit to Secured Party.  Each Debtor, on behalf of itself
and any Obligor, hereby waives the benefit of any law that would otherwise
restrict or limit Secured Party in the exercise of its right, which is hereby
acknowledged, to appropriate at any time hereafter any such indebtedness owing
from Secured Party to any Obligor.
 
4.5          Additional Remedies.  Upon the occurrence and during the
continuance of an Event of Default, Secured Party shall have the right and power
to:
 
   (a)           instruct any Debtor, at its own expense, to notify any parties
obligated on any of the Collateral, including any Customers, to make payment
directly to Secured Party of any amounts due or to become due thereunder, or
Secured Party may directly notify such obligors of the security interest of
Secured Party, and/or of the assignment to Secured Party of the Collateral and
direct such obligors to make payment to Secured Party of any amounts due or to
become due with respect thereto, and thereafter, collect any such amounts due on
the Collateral directly from such Persons obligated thereon;
 
   (b)           enforce collection of any of the Collateral, including any
Accounts, by suit or otherwise, or make any compromise or settlement with
respect to any of the Collateral, or surrender, release or exchange all or any
part thereof, or compromise, extend or renew for any period (whether or not
longer than the original period) any indebtedness thereunder;
 

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   (c)          take possession or control of any proceeds and products of any
of the Collateral, including the proceeds of insurance thereon;
 
   (d)          extend, renew or modify for one or more periods (whether or not
longer than the original period) the Obligations or any obligation of any nature
of any other obligor with respect to the Obligations;
 
   (e)          grant releases, compromises or indulgences with respect to the
Obligations, any extension or renewal of any of the Obligations, any security
therefor, or to any other obligor with respect to the Obligations;
 
   (f)           transfer the whole or any part of Capital Securities which may
constitute Collateral into the name of Secured Party or Secured Party’s nominee
without disclosing, if Secured Party so desires, that such Capital Securities so
transferred are subject to the security interest of Secured Party, and any
corporation, association, or any of the managers or trustees of any trust
issuing any of such Capital Securities, or any transfer agent, shall not be
bound to inquire, in the event that Secured Party or such nominee makes any
further transfer of such Capital Securities, or any portion thereof, as to
whether Secured Party or such nominee has the right to make such further
transfer, and shall not be liable for transferring the same;
 
   (g)           vote the Collateral;
 
   (h)           make an election with respect to the Collateral under Section
1111 of the Bankruptcy Code or take action under Section 364 or any other
section of Bankruptcy Code; provided, however, that any such action of Secured
Party as set forth herein shall not, in any manner whatsoever, impair or affect
the liability of Debtors hereunder, nor prejudice, waive, nor be construed to
impair, affect, prejudice or waive Secured Party’s rights and remedies at law,
in equity or by statute, nor release, discharge, nor be construed to release or
discharge, Debtors, any guarantor or other Person liable to Secured Party for
the Obligations; and
 
  (i)            at any time, and from time to time, accept additions to,
releases, reductions, exchanges or substitution of the Collateral, without in
any way altering, impairing, diminishing or affecting the provisions of this
Security Agreement, the Loan Documents, or any of the other Obligations, or
Secured Party’s rights hereunder, under the Obligations.
 
   Each Debtor hereby ratifies and confirms whatever Secured Party may do with
respect to the Collateral and agrees that Secured Party shall not be liable for
any error of judgment or mistakes of fact or law with respect to actions taken
in connection with the Collateral.
 
                    4.6          Attorney-in-Fact.  Each Debtor hereby
irrevocably makes, constitutes and appoints Secured Party (and any officer of
Secured Party or any Person designated by Secured Party for that purpose) as
such Debtor’s true and lawful proxy and attorney-in-fact (and agent-in-fact) in
Debtor’s name, place and stead, with full power of substitution, to: (i) take
such actions as are permitted in this Security Agreement; (ii) execute such
financing statements and other documents and to do such other acts as Secured
Party may require to perfect and preserve Secured Party’s security interest in,
and to enforce such interests in the Collateral; and (iii) upon the occurrence
and during the continuance of an Event of Default, carry out any remedy provided
for in this Security Agreement, the Credit Agreement or through law or equity,
including endorsing such Debtor’s name to checks, drafts, instruments and other
items of payment, and proceeds of the Collateral, executing change of address
forms with the postmaster of the United States Post Office serving the address
of such Debtor, changing the address of such Debtor to that of Secured Party,
opening all envelopes addressed to such Debtor and applying any payments
contained therein to the Obligations, and changing any merchant accounts or
instructions to Payment Processing Companies regarding any credit/debit card
payments from Customers.  Each Debtor hereby acknowledges that the constitution
and appointment of such proxy and attorney-in-fact are coupled with an interest
and are irrevocable.  Each Debtor hereby ratifies and confirms all that such
attorney-in-fact may do or cause to be done by virtue of any provision of this
Security Agreement.
 

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                    4.7          No Marshaling.  Secured Party shall not be
required to marshal any present or future collateral security (including this
Security Agreement and the Collateral) for, or other assurances of payment of,
the Obligations or any of them or to resort to such collateral security or other
assurances of payment in any particular order.  To the extent that it lawfully
may, each Debtor hereby agrees that it will not invoke any law relating to the
marshaling of collateral which might cause delay in or impede the enforcement of
Secured Party’s rights under this Security Agreement or under any other
instrument creating or evidencing any of the Obligations or under which any of
the Obligations is outstanding or by which any of the Obligations is secured or
payment thereof is otherwise assured, and, to the extent that it lawfully may,
each Debtor hereby irrevocably waives the benefits of all such laws.
 
                    4.8          No Waiver.  No Event of Default shall be waived
by Secured Party except in writing.  No failure or delay on the part of Secured
Party in exercising any right, power or remedy hereunder shall operate as a
waiver of the exercise of the same or any other right at any other time; nor
shall any single or partial exercise of any such right, power or remedy preclude
any other or further exercise thereof or the exercise of any other right, power
or remedy hereunder.  There shall be no obligation on the part of Secured Party
to exercise any remedy available to Secured Party in any order.  The remedies
provided for herein are cumulative and not exclusive of any remedies provided at
law or in equity.  Each Debtor agrees that in the event that such Debtor fails
to perform, observe or discharge any of its Obligations or liabilities under
this Security Agreement or any other agreements with Secured Party, no remedy of
law will provide adequate relief to Secured Party, and further agrees that
Secured Party shall be entitled to temporary and permanent injunctive relief in
any such case without the necessity of proving actual damages.
 
4.9           Application of Proceeds.  Secured Party will, within three (3)
Business Days after receipt of cash or solvent credits from collection of items
of payment, proceeds of Collateral or any other source, apply the whole or any
part thereof against the Obligations secured hereby.  Secured Party shall
further have the exclusive right to determine how, when and what application of
such payments and such credits shall be made on the Obligations, and such
determination shall be conclusive upon Debtors.  Any proceeds of any disposition
by Secured Party of all or any part of the Collateral may be first applied by
Secured Party to the payment of expenses incurred by Secured Party in connection
with the Collateral, including reasonable attorneys’ fees and legal expenses and
costs as provided for in Section 5.13 hereof.
 

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5             MISCELLANEOUS.
 
                    5.1          Entire Agreement.  This Security Agreement and
the other Loan Documents: (i) are valid, binding and enforceable against Debtors
and Secured Party in accordance with their respective provisions and no
conditions exist as to their legal effectiveness; (ii) constitute the entire
agreement between the parties with respect to the subject matter hereof and
thereof; and (iii) are the final expression of the intentions of Debtors and
Secured Party.  No promises, either expressed or implied, exist between any
Debtor and Secured Party, unless contained herein or therein.  This Security
Agreement, together with the other Loan Documents, supersedes all negotiations,
representations, warranties, commitments, term sheets, discussions,
negotiations, offers or contracts (of any kind or nature, whether oral or
written) prior to or contemporaneous with the execution hereof with respect to
any matter, directly or indirectly related to the terms of this Security
Agreement and the other Loan Documents.  This Security Agreement and the other
Loan Documents are the result of negotiations between Secured Party and Debtors
and have been reviewed (or have had the opportunity to be reviewed) by counsel
to all such parties, and are the products of all parties.  Accordingly, this
Security Agreement and the other Loan Documents shall not be construed more
strictly against Secured Party merely because of Secured Party’s involvement in
their preparation.
 
                    5.2          Amendments; Waivers.  No delay on the part of
Secured Party in the exercise of any right, power or remedy shall operate as a
waiver thereof, nor shall any single or partial exercise by Secured Party of any
right, power or remedy preclude other or further exercise thereof, or the
exercise of any other right, power or remedy.  No amendment, modification or
waiver of, or consent with respect to, any provision of this Security Agreement
or the other Loan Documents shall in any event be effective unless the same
shall be in writing and acknowledged by Secured Party and, in the case of any
amendment or modification, also by Debtors, and then any such amendment,
modification, waiver or consent shall be effective only in the specific instance
and for the specific purpose for which given.
 
                    5.3          WAIVER OF DEFENSES.  EACH DEBTOR WAIVES EVERY
PRESENT AND FUTURE DEFENSE, CAUSE OF ACTION, COUNTERCLAIM OR SETOFF WHICH SUCH
DEBTOR MAY NOW HAVE OR HEREAFTER MAY HAVE TO ANY ACTION BY SECURED PARTY IN
ENFORCING THIS SECURITY AGREEMENT.  PROVIDED SECURED PARTY ACTS IN GOOD FAITH,
EACH DEBTOR RATIFIES AND CONFIRMS WHATEVER SECURED PARTY MAY DO PURSUANT TO THE
TERMS OF THIS SECURITY AGREEMENT.  THIS PROVISION IS A MATERIAL INDUCEMENT FOR
SECURED PARTY GRANTING ANY FINANCIAL ACCOMMODATION TO DEBTORS.
 
                    5.4          MANDATORY FORUM SELECTION.  TO INDUCE SECURED
PARTY TO MAKE CERTAIN FINANCIAL ACCOMODATIONS TO DEBTORS, EACH DEBTOR
IRREVOCABLY AGREES THAT ANY DISPUTE ARISING UNDER, RELATING TO, OR IN CONNECTION
WITH, DIRECTLY OR INDIRECTLY, THIS AGREEMENT OR RELATED TO ANY MATTER WHICH IS
THE SUBJECT OF OR INCIDENTAL TO THIS AGREEMENT ANY OTHER LOAN DOCUMENT, OR THE
COLLATERAL (WHETHER OR NOT SUCH CLAIM IS BASED UPON BREACH OF CONTRACT OR TORT)
SHALL BE SUBJECT TO THE EXCLUSIVE JURISDICTION AND VENUE OF THE STATE AND/OR
FEDERAL COURTS LOCATED IN BROWARD COUNTY, FLORIDA.  THIS PROVISION  IS INTENDED
TO BE A “MANDATORY” FORUM SELECTION CLAUSE AND GOVERNED BY AND INTERPRETED
CONSISTENT WITH FLORIDA LAW. EACH DEBTOR HEREBY CONSENTS TO THE EXCLUSIVE
JURISDICTION AND VENUE OF ANY STATE OR FEDERAL COURT HAVING ITS SITUS IN SAID
COUNTY, AND EACH WAIVES ANY OBJECTION BASED ON FORUM NON CONVENIENS. EACH DEBTOR
HEREBY WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS AND CONSENT THAT ALL SUCH
SERVICE OF PROCESS MAY BE MADE BY CERTIFIED MAIL, RETURN RECEIPT REQUESTED,
DIRECTED TO A DEBTOR, AS APPLICABLE, AS SET FORTH HEREIN IN THE MANNER PROVIDED
BY APPLICABLE STATUTE, LAW, RULE OF COURT OR OTHERWISE.
 

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                    5.5         WAIVER OF JURY TRIAL.  EACH DEBTOR AND SECURED
PARTY, AFTER CONSULTING OR HAVING HAD THE OPPORTUNITY TO CONSULT WITH COUNSEL,
EACH KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE IRREVOCABLY, ANY RIGHT TO A
TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER
THIS SECURITY AGREEMENT, ANY NOTE, ANY OTHER LOAN DOCUMENT, ANY OF THE OTHER
OBLIGATIONS, THE COLLATERAL, OR ANY AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT
DELIVERED OR WHICH MAY IN THE FUTURE BE DELIVERED IN CONNECTION HEREWITH OR
THEREWITH OR ARISING FROM ANY LENDING RELATIONSHIP EXISTING IN CONNECTION WITH
ANY OF THE FOREGOING, OR ANY COURSE OF CONDUCT OR COURSE OF DEALING IN WHICH
SECURED PARTY AND ANY DEBTOR ARE ADVERSE PARTIES, AND EACH AGREES THAT ANY SUCH
ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY.  THIS
PROVISION IS A MATERIAL INDUCEMENT FOR SECURED PARTY GRANTING ANY FINANCIAL
ACCOMMODATION TO DEBTORS.
 
                    5.6          Assignability.  Secured Party, without consent
from or notice to anyone, may at any time assign Secured Party’s rights in this
Security Agreement, the other Loan Documents, the Obligations, or any part
thereof and transfer Secured Party’s rights in any or all of the Collateral, and
Secured Party thereafter shall be relieved from all liability with respect to
such Collateral.  This Security Agreement shall be binding upon Secured Party
and Debtors and their respective legal representatives and successors.  All
references herein to any Debtor shall be deemed to include any successors,
whether immediate or remote.  In the case of a joint venture or partnership, the
term “Debtor” or “Debtors” shall be deemed to include all joint venturers or
partners thereof, who shall be jointly and severally liable hereunder.
 
5.7          Binding Effect.  This Security Agreement shall become effective
upon execution by Debtors and Secured Party.
 
                    5.8          Governing Law.  Except in the case of the
Mandatory Forum Selection Clause in Section 5.4 above, which clause shall be
governed and interpreted in accordance with Florida law, this Agreement shall be
delivered and accepted in and shall be deemed to be a contract made under and
governed by the internal laws of the State of Nevada, and for all purposes shall
be construed in accordance with the laws of such State, without giving effect to
the choice of law provisions of such State.
 

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                    5.9          Enforceability.  Wherever possible, each
provision of this Security Agreement shall be interpreted in such manner as to
be effective and valid under applicable law, but if any provision of this
Security Agreement shall be prohibited by, unenforceable or invalid under any
jurisdiction, such provision shall as to such jurisdiction, be severable and be
ineffective to the extent of such prohibition or invalidity, without
invalidating the remaining provisions of this Security Agreement or affecting
the validity or enforceability of such provision in any other jurisdiction.
 
                    5.10        Time of Essence.  Time is of the essence in
making payments of all amounts due Secured Party under the Loan Documents and in
the performance and observance by Debtors of each covenant, agreement, provision
and term of this Security Agreement and the other Loan Documents.
 
                    5.11        Counterparts; Facsimile Signatures.  This
Security Agreement may be executed in any number of counterparts and by the
different parties hereto on separate counterparts and each such counterpart
shall be deemed to be an original, but all such counterparts shall together
constitute but one and the same Security Agreement.  Receipt of an executed
signature page to this Security Agreement by facsimile or other electronic
transmission shall constitute effective delivery thereof.  Electronic records of
executed Loan Documents maintained by Secured Party shall be deemed to be
originals thereof.
 
                    5.12        Notices.  Except as otherwise provided herein,
each Debtor waives all notices and demands in connection with the enforcement of
Secured Party’s rights hereunder.  All notices, requests, demands and other
communications provided for hereunder shall be made in accordance with the terms
of the Credit Agreement.
 
                    5.13        Costs, Fees and Expenses.  Debtors shall pay or
reimburse Secured Party for all reasonable costs, fees and expenses incurred by
Secured Party or for which Secured Party becomes obligated in connection with
the enforcement of this Security Agreement, including search fees, costs and
expenses and attorneys’ fees, costs and time charges of counsel to Secured Party
and all taxes payable in connection with this Security Agreement.  In
furtherance of the foregoing, Debtors shall pay any and all stamp and other
taxes, UCC search fees, filing fees and other costs and expenses in connection
with the execution and delivery of this Security Agreement and the other Loan
Documents to be delivered hereunder, and agrees to save and hold Secured Party
harmless from and against any and all liabilities with respect to or resulting
from any delay in paying or omission to pay such costs and expenses.  That
portion of the Obligations consisting of costs, expenses or advances to be
reimbursed by Debtors to Secured Party pursuant to this Security Agreement or
the other Loan Documents which are not paid on or prior to the date hereof shall
be payable by Debtors to Secured Party on demand.  If at any time or times
hereafter Secured Party: (a) employs counsel for advice or other representation:
(i) with respect to this Security Agreement or the other Loan Documents; (ii) to
represent Secured Party in any litigation, contest, dispute, suit or proceeding
or to commence, defend, or intervene or to take any other action in or with
respect to any litigation, contest, dispute, suit, or proceeding (whether
instituted by Secured Party, any Debtor, or any other Person) in any way or
respect relating to this Security Agreement; or (iii) to enforce any rights of
Secured Party against any Debtor or any other Person under of this Security
Agreement; (b) takes any action to protect, collect, sell, liquidate, or
otherwise dispose of any of the Collateral; and/or (c) attempts to or enforces
any of Secured Party’s rights or remedies under this Security Agreement, the
costs and expenses incurred by Secured Party in any manner or way with respect
to the foregoing, shall be part of the Obligations, payable by Debtors to
Secured Party on demand.
 

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                    5.14        Termination.  This Security Agreement and the
Liens and security interests granted hereunder shall not terminate until the
termination of the Credit Agreement and the commitments to make Loans thereunder
and the full and complete performance and satisfaction and payment in full of
all the Obligations (other than contingent indemnification obligations to the
extent no claim giving rise thereto has been asserted).  Upon termination of
this Security Agreement, Secured Party shall also deliver to Debtors (at the
sole expense of Debtors) such UCC termination statements, certificates for
terminating the liens on the Motor Vehicles (if any) and such other
documentation, without recourse, warranty or representation whatsoever, as shall
be reasonably requested by Debtors to effect the termination and release of the
Liens and security interests in favor of Secured Party affecting the Collateral,
provided, however, to the extent any such terminations or releases require
Secured Party to expend any sums in terminating or releasing any such Liens,
Secured Party may refrain from terminating or releasing such Liens unless and
until Debtors pay to Secured Party the estimated cost, as reasonably determined
by Secured Party, of effectuating such terminations or releases.
 
                    5.15        Reinstatement.  This Security Agreement shall
remain in full force and effect and continue to be effective should any petition
be filed by or against any Debtor for liquidation or reorganization, should any
Debtor become insolvent or make an assignment for the benefit of any creditor or
creditors or should a receiver or trustee be appointed for all or any
significant part of any Debtor’s assets, and shall continue to be effective or
be reinstated, as the case may be, if at any time payment and performance of the
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 Obligations, whether as a “voidable preference,” “fraudulent conveyance,” or
otherwise, all as though such payment or performance had not been made.  In the
event that any payment, or any part thereof, is rescinded, reduced, restored or
returned, the Obligations shall be reinstated and deemed reduced only by such
amount paid and not so rescinded, reduced, restored or returned.
 
                    5.16        Joint and Several Liability.  The liability of
all Debtors hereunder for the Obligations, or for the performance of any other
term, condition, covenant or agreement of any Debtor hereunder, shall be joint
and several as between all Debtors.
 
[SIGNATURE PAGE FOLLOWS]
 

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IN WITNESS WHEREOF, Debtors and Secured Party have executed this Security
Agreement as of the date first above written.
 
Debtors:
 

DR. TATTOFF, INC.,  DRTHC I, LLC, a Florida corporation a Delaware limited
liability company

 

           
By: 
/s/ Harry Zimmerman  
By:
    /s/ Harry Zimmerman  
Name:  
Harry Zimmerman  
Name:
Harry Zimmerman  
Title:   
EVP - COO  
Title:
  EVP - COO  

 
DRTHC II, LLC,
a Delaware limited liability company

     
By:
    /s/ Harry Zimmerman    Name: Harry Zimmerman   Title:   EVP - COO  

 

           Agreed and accepted:        Secured Party:        TCA GLOBAL CREDIT
MASTER FUND, LP              By:   TCA Global Credit Fund GP, Ltd.      Its: 
 General Partner              By:  /s/ Robert Press          Robert Press,
Director

 

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