Exhibit 10.4

 

Security Agreement

 

The payment of the Principal and accrued Interest (if any) due from time to
time, under the First Promissory Note, Second Promissory Note, and Hill
Promissory Note (collectively the “Obligations”) entered into by Panther
Biotechnology, Inc. (“Panther”) in favor of Scott Schwartz and Hill Electric
Supply Co., Inc., arising out of a certain Share Exchange Agreement, effective
January 1, 2017, made by and between Panther, Premier Purchasing and Marketing
Alliance, LLC, a New York limited liability company (“Premier”) and the sole
member of Premier Purchasing and Marketing Alliance, LLC, Scott Schwartz shall
be secured by a security interest in, a continuing first lien upon, an
unqualified right to possession and disposition of and a right of set-off
against, in each case to the fullest extent permitted by law, of 100% of the
membership interests in Premier (the “Collateral” and the “Security Interest”).

 

(a)       Upon occurrence and continuance of any Event of Default (as defined in
the First Promissory Note and Second Promissory Note and Hill Promissory Note)
and at any time thereafter, Scott Schwartz and Hill Electric Supply Co., Inc.
(for the purposes of this agreement, the “Secured Party”) shall have the right
to exercise all of the remedies conferred hereunder, and the Secured Party shall
have all the rights and remedies of a secured party under the Uniform Commercial
Code, as currently in effect in the State of Texas (the “UCC”) and/or any other
applicable law (including the Uniform Commercial Code of any jurisdiction in
which any Collateral is then located). Without limitation, the Secured Party
shall have the following rights and powers:

 

i.The Secured Party shall have the right to take possession and ownership of the
Collateral, subject to applicable law.

 

ii.The Secured Party shall have the right to assign, sell, lease or otherwise
dispose of and deliver all or any part of the Collateral, at public or private
sale or otherwise, either with or without special conditions or stipulations,
for cash or on credit or for future delivery, in such parcel or parcels and at
such time or times and at such place or places, and upon such terms and
conditions as the Secured Party may deem commercially reasonable, all without
(except as shall be required by applicable statute and cannot be waived)
advertisement or demand upon or notice to Panther or right of redemption of
Panther, which are hereby expressly waived. Upon each such sale, lease,
assignment or other transfer of Collateral, the Secured Party may, unless
prohibited by applicable law which cannot be waived, purchase all or any part of
the Collateral being sold, free from and discharged of all trusts, claims, right
of redemption and equities of Panther, which are hereby waived and released.

 

(b)       The proceeds of any such sale, lease or other disposition of the
Collateral hereunder (and/or in the event of a taking under Section (a)(i),
above, the fair value attributed to the Collateral) shall be applied first, to
the expenses of retaking, holding, storing, processing and preparing for sale,
selling, and the like (including, without limitation, any taxes, fees and other
costs incurred in connection therewith) of the Collateral, to the reasonable
attorneys’ fees and expenses incurred by the Secured Party in enforcing its
rights hereunder and in connection with collecting, storing and disposing of the
Collateral, and then to satisfaction of the Obligations, and to the payment of
any other amounts required by applicable law, after which the Secured Party
shall pay to Panther any surplus proceeds (or the difference between the fair
value and value of the Obligations in the event of a taking under Section
(a)(i), above). If, upon the taking by Secured Party or the sale, license or
other disposition of the Collateral, the proceeds thereof are insufficient to
pay all amounts to which the Secured Party is legally entitled, Panther will be
liable for the deficiency, together with interest thereon, at the rate of
eighteen percent (18%) per annum (the “Default Rate”), and the reasonable fees
of any attorneys employed by the Secured Party to collect such deficiency. To
the extent permitted by applicable law, Panther waives all claims, damages and
demands against the Secured Party arising out of the taking, repossession,
removal, retention or sale of the Collateral, unless due to the gross negligence
or willful misconduct of the Secured Party.

 

 

 

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(c)       Panther shall preserve and protect Secured Party’s Security Interest
in the Collateral and shall cause the Security Interest to be perfected and to
continue to be perfected until the Obligations are paid and performed in full.
Panther shall execute and deliver to Secured Party (within ten days after
receipt of Secured Party’s request) such other security agreements,
endorsements, pledges, assignments and other documents (including, without
limitation, financing statements and continuation statements and amendments
thereto and mortgages or deeds of trust) as Secured Party may request from time
to time to effectuate the grant to Secured Party of the Security Interest and
the perfection of the Security Interest, and Secured Party is authorized to file
and/or record such documents with appropriate regulatory authorities. Panther
shall promptly notify Secured Party in sufficient detail upon becoming aware of
any attachment, garnishment, execution or other legal process levied against any
Collateral and of any other information received by Panther that may materially
affect the value of the Collateral, the Security Interest or the rights and
remedies of Secured Party hereunder.

 

(d)       Panther agrees to pay all out-of-pocket fees, costs and expenses
incurred in connection with any filing which may be required or requested by
Secured Party hereunder, including without limitation, any financing statements,
continuation statements, partial releases and/or termination statements related
thereto or any expenses of any searches reasonably required by the Secured
Party. Panther shall also pay all other claims and charges which in the
reasonable opinion of the Secured Party might prejudice, imperil or otherwise
affect the Collateral or the Security Interest therein. Panther will also, upon
demand, pay to the Secured Party the amount of any and all reasonable expenses,
including the reasonable fees and expenses of its counsel and of any experts and
agents, which the Secured Party may incur in connection with (i) the enforcement
of this agreement and the Security Interest, (ii) the custody or preservation
of, or the sale of, collection from, or other realization upon, any of the
Collateral, or (iii) the exercise or enforcement of any of the rights of the
Secured Party under the First Promissory Note, Second Promissory Note or the
Hill Promissory Note. Until so paid, any fees payable hereunder shall be added
to the principal amount of the First Promissory Note and/or Second Promissory
Note and/or Hill Promissory Note, as applicable, and shall bear interest at the
Default Rate.

 

(e)       Panther hereby appoints Secured Party as its attorney-in-fact (with
full power of substitution) to execute, deliver and file, effective upon the
parties’ entry into this agreement, on Panther’s behalf and at Panther’s
expense, (1) any financing statements, continuation statements or other
documents required to perfect or continue the Security Interest and (2) any
other documents and instruments that Secured Party determines are necessary or
appropriate in order to enable it to exercise its rights and remedies that are
provided hereunder and by applicable law upon the occurrence of an Event of
Default. This power, being coupled with an interest, shall be irrevocable until
the Obligations are paid and performed in full.

 

(f)       All rights of Secured Party and all Obligations of Panther hereunder,
shall be absolute and unconditional, irrespective of: (a) any lack of validity
or enforceability of the First Promissory Note, Second Promissory Note, Hill
Promissory Note or this agreement, or any agreement entered into in connection
with the foregoing, or any portion hereof or thereof; (b) any change in the
time, manner or place of payment or performance of, or in any other term of, all
or any of the Obligations, or any other amendment or waiver of or any consent to
any departure from the First Promissory Note, Second Promissory Note, Hill
Promissory Note or this agreement, or any other agreement entered into in
connection with the foregoing; (c) any exchange, release or non-perfection of
any of the Collateral, or any release or amendment or waiver of or consent to
departure from any other collateral for, or any guaranty, or any other security,
for all or any of the Obligations; (d) any action by Secured Party or a
Collateral Agent on behalf of Secured Party to obtain, adjust, settle and cancel
in its sole discretion any insurance claims or matters made or arising in
connection with the Collateral; or (e) any other circumstance which might
otherwise constitute any legal or equitable defense available to Panther, or a
discharge of all or any part of the Security Interest granted hereby. Until the
Obligations shall have been paid and performed in full, the rights of Secured
Party shall continue even if the Obligations are barred for any reason,
including, without limitation, the running of the statute of limitations or
bankruptcy. Panther expressly waives presentment, protest, notice of protest,
demand, notice of nonpayment and demand for performance. In the event that at
any time any transfer of any Collateral or any payment received by Secured Party
hereunder shall be deemed by final order of a court of competent jurisdiction to
have been a voidable preference or fraudulent conveyance under the bankruptcy or
insolvency laws of the United States, or shall be deemed to be otherwise due to
any party other than Secured Party, then, in any such event, Panther’s
Obligations hereunder shall survive cancellation of this agreement, and shall
not be discharged or satisfied by any prior payment thereof and/or cancellation
of this agreement, but shall remain a valid and binding obligation enforceable
in accordance with the terms and provisions hereof. Panther waives any defense
arising by reason of the application of the statute of limitations to any
obligation secured hereby.

 

 

 

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(g)       The Collateral shall not be used as collateral or sold, and Panther
shall not take on any debt or liabilities without the written permission of the
Secured Party, which in the case of being used for collateral, shall not be
unreasonably withheld, conditioned or delayed.

 

(h)       The powers conferred on the Secured Party hereunder are solely to
protect its interest in the Collateral and shall not impose any duty upon it to
exercise any such powers. The Secured Party shall use reasonable care to
maintain the Collateral in its possession.

 

(i)       Panther shall be permitted to exercise all voting rights with respect
to the Collateral, subject to Secured Party’s rights upon an Event of Default as
described herein; provided, however, that no vote shall be cast or other action
taken which would impair the security interest or which would be inconsistent
with or result in any violation of any provision of this agreement. Secured
Party shall promptly provide Panther voting proxies and other materials
reasonably requested from time to time in order to confirm Panther’s voting
rights hereunder.

 

(j)       Panther shall own and control all economic rights of the Collateral,
subject to Secured Party’s rights upon an Event of Default as described herein,
including, but not limited to all rights to dividends paid or payable other than
in cash, in respect of, and instruments and other property received, receivable
or otherwise distributed in respect of, or in exchange for, the Collateral,
dividends and other distributions paid or payable in cash in respect of the
Collateral, and cash paid, payable or otherwise distributed in redemption of, or
in exchange for, any Collateral.

 

(k)       Except for the security interest granted to Secured Party pursuant to
this agreement, Panther shall be the sole owner of the Collateral having good
and marketable title thereto, free and clear of any and all liens.

 

(l)       This agreement, any and all security interests and any and all rights
and powers granted to Secured Party under this agreement shall automatically
terminate and be of no further force and effect upon the payment in full of the
amounts due Secured Party under the First Promissory Note and Second Promissory
Note and Hill Promissory Note (the “Termination Date”). Secured Party hereby
irrevocably constitutes and appoints Panther and any officer or agent thereof,
with full power of substitution, as its true and lawful attorney-in-fact with
full irrevocable power and authority in place and stead of Secured Party and in
the name of Secured Party or in his own name, immediately upon the Termination
Date, for the exclusive purpose of filing (a) a Termination Statement on Form
UCC 3 (or any successor form) and (b) any other documents necessary or desirable
to evidence the termination of any and all security interests held by Secured
Party.

 

(m)       Within five business days of the Termination Date, Secured Party shall
transfer to Panther, all Collateral held by Secured Party, including
certificates evidencing 100% of the membership interests of Premier, together
with blank stock powers, and such other documentation as Panther or its legal
counsel may reasonably request.

 

(n)       This agreement shall be governed by and construed and enforced in
accordance with the local laws of the State of Texas applicable to agreements
made and to be performed entirely within the State, without regard to conflict
of laws principles. The parties hereby irrevocably consent and submit to the
jurisdiction of any Texas or Federal court located in Harris County, Texas over
any action or proceeding arising out of any dispute between the parties, and
waive any right they have to bring an action or proceeding with respect thereto
in any other jurisdiction.

 

(o)       This agreement contains the entire agreement between the parties
hereto and (i) there are no agreements, warranties or representations which are
not set forth herein and (ii) all prior negotiations, agreements and
understandings are superseded hereby. This agreement may not be modified or
amended except by an instrument in writing duly signed by or on behalf of the
parties hereto.

 

 

 

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Dated effective: January 1, 2017

 

Panther Biotechnology, Inc. Premier Purchasing and Marketing Alliance, LLC    
By: /s/ Evan Levine By: /s/ Scott Schwartz Evan Levine Scott Schwartz, sole
member Chief Executive Officer             Hill Electric Supply Co., Inc.      
  /s/ Scott Schwartz By: /s/ Scott Schwartz Scott Schwartz Scott Schwartz,
President

 

 

 

 

 

 

 

 

 

 

 

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