EXHIBIT 10.09

 

 

VERITY CORP. SECURITY AGREEMENT-VERITY FARMS

 

THIS VERITY CORP. SECURITY AGREEMENT-VERITY FARMS is dated as of May 16, 2014
and Verity Corp., a Nevada corporation, (“Grantor”), and DUANE SPADER (the
“Lender”).

 

R E C I T A L S

 

WHEREAS, Verity Farms, L.L.C., a South Dakota limited liability company
(“Borrower”) and the Lender have entered into a Revolving Credit Agreement dated
October 13, 2013 (said Agreement, as it may hereafter be amended, supplemented
or otherwise modified from time to time, being the “Credit Agreement”). (Terms
defined in the Credit Agreement and not otherwise defined in this Agreement are
used in this Agreement as defined in the Credit Agreement.)

 

WHEREAS, in partial consideration for amendment of the Credit Agreement, the
Grantor is entering into this Agreement to secure Grantor’s obligations under
the Verity Corp. Guaranty-Verity Farms (“Verity Farms Guaranty”) entered into
between the parties as of the date hereof and in order to grant to the Lender a
security interest in the Collateral (as hereinafter defined).

 

WHEREAS, it is a condition precedent to Lender’s obligations under the Change in
Terms Agreement to be entered into by Borrower and Lender as of the date hereof,
which is an amendment to the Credit Agreement, that the Grantor shall have
entered into the Verity Farms Guaranty shall have granted the assignment and
security interest contemplated by this Agreement.

 

WHEREAS, Grantor has and will derive substantial direct and indirect benefit
from the transactions contemplated by the Credit Agreement, including the Change
in Terms Agreement..

 

WHEREAS, Grantor acknowledges and agrees that Lender advanced funds to Borrower
as start-up funding until funds could be raised by Borrower or its Affiliates
through sales of equity interest in Borrower or its Affiliates or from
borrowings with the intention that amounts advanced by Lender under the Credit
Agreement and otherwise would be promptly repaid to Lender as other sources of
funding become available.

 

NOW, THEREFORE, in consideration of the premises and in order to induce the
Lender to amend under the Credit Agreement as described in the Change in Terms
Agreement, Grantor hereby agrees with the Lender as follows:

 

Section 1. Grant of Security. Grantor hereby grants to the Lender a security
interest in Grantor’s right, title and interest in and to all of Grantor’s
goods, assets and properties of all kinds and descriptions, wherever the same
may now or hereafter be located, now existing and/or owned or hereafter arising
and/or acquired, or in which Grantor has or hereafter may acquire an interest,
to the extent of such interest (collectively, the “Collateral”), including
without limitation the following:

 

All accounts, deposit accounts, equipment, inventory, fixtures, contract rights,
investment property, chattel paper, documents, instruments, commercial tort
claims and general intangibles (including payment intangibles), and all other
personal property, whether now owned or hereafter acquired and wherever arising
or located, and all products and proceeds thereof, and all accessions,
substitutions and replacements thereof, including, without limitation, the
personal property described on Schedule I attached hereto.

 

 

 

 

Section 2. Security for Obligations. . This Agreement secures, in the case of
Grantor, the payment of all obligations of Grantor to Lender now or hereafter
existing under the Loan Documents, including, without limitation, the
“Guaranteed Obligations” under the Verity Farms Guaranty, whether such
obligations are direct or indirect, absolute or contingent, and whether for
principal, reimbursement obligations, interest, fees, premiums, penalties,
indemnifications, contract causes of action, costs, expenses or otherwise (all
such obligations being the “Secured Obligations”). Notwithstanding the terms of
the Credit Agreement or any related document, as concerns the obligations of
Grantor with respect to the Secured Obligations, prepayment is required by
Grantor under the Verity Farms Guaranty each time (to be paid within ten (10)
days thereafter) that Grantor or any Affiliate thereof raises, from time to
time, funds through the sales of equity interests in Grantor or its Affiliates
or obtains funds by borrowing from other sources; provided that (i) this
prepayment requirement shall only apply to funds received by Grantor or any
Affiliate thereof after September 30, 2015, and then, after such date, only to
sales of equity interests or borrowings from other sources if the total funds
generated thereby from and after October 1, 2015, exceed Five Hundred Thousand
Dollars ($500,000.00), and (ii) the total amount of any such prepayment required
at a particular time under such Verity Farms Guaranty, together with any
prepayment then due under similar prepayment provisions included in other
guarantees executed by Grantor or its Affiliates in favor of Lender, is limited
to fifty percent (50%) of the amount of funds then raised by such sale of equity
interest or borrowings. Without limiting the generality of the foregoing, this
Agreement secures, as to Grantor, the payment of all amounts that constitute
part of the Secured Obligations and would be owed by Grantor to Lender under the
Loan Documents but for the fact that they are unenforceable or not allowable due
to the existence of a bankruptcy, reorganization or similar proceeding involving
an Obligated Party.

 

Section 3. Grantor Remains Liable. Anything herein to the contrary
notwithstanding, (a) Grantor shall remain liable under the contracts and
agreements included in Grantor’s Collateral to the extent set forth therein to
perform all of its duties and obligations thereunder to the same extent as if
this Agreement had not been executed, (b) the exercise by the Lender of any of
the rights hereunder shall not release Grantor from any of its duties or
obligations under the contracts and agreements included in the Collateral and
(c) Lender shall not have any obligation or liability under the contracts and
agreements included in the Collateral by reason of this Agreement or any other
Loan Document, nor shall Lender be obligated to perform any of the obligations
or duties of Grantor thereunder or to take any action to collect or enforce any
claim for payment assigned hereunder.

 

Section 4. Covenants from Credit Agreement. Grantor covenants and agrees that,
so long as any part of the Secured Obligations shall remain unpaid or Lender
shall have any commitment under the Credit Agreement, Grantor will perform and
observe all of the terms, covenants and agreements set forth in the Credit
Agreement and the other Loan Documents on its part to be performed or observed
or that Borrower has agreed to cause Grantor to perform or observe.

 

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Section 5. Representations and Warranties. Grantor represents and warrants as
follows:

 

(a) Grantor’s exact legal name, as defined in Section 9-503(a) of the UCC, is
correctly set forth in Schedule II hereto. Grantor is located (within the
meaning of Section 9-307 of the UCC) and has its chief executive office in the
state or jurisdiction set forth in Schedule II hereto. The information set forth
in Schedule II hereto with respect to Grantor is true and accurate in all
respects. Grantor has not previously changed its name, location, chief executive
office, place where it maintains its agreements, type of organization,
jurisdiction of organization or organizational identification number or federal
employer identification number (EIN) from those set forth in Schedule II hereto.
All of the equipment and inventory of Grantor are located at the locations
specified for Grantor in Schedule II hereto.

 

(b) Grantor is the legal and beneficial owner of the Collateral of Grantor free
and clear of any lien, security interest, claim, option or right of others,
except for the security interest created under this Agreement or permitted under
the Credit Agreement. No effective financing statement or other instrument
similar in effect covering all or any part of such Collateral or listing Grantor
or any trade name of Grantor as debtor is on file in any recording office,
except such as may have been filed in favor of the Lender relating to the Loan
Documents or the Verity Farms Guaranty, the Verity Corp. Guaranty-Meats or the
Verity Corp. Guaranty-Water, all of such guaranties to be executed as of the
date hereof, or as otherwise permitted under the Credit Agreement.

 

(c) Grantor has exclusive possession and control of the equipment and inventory
other than inventory stored at any leased premises or warehouse for which a
landlord’s or warehouseman’s agreement, in form and substance satisfactory to
the Lender, is in effect. In the case of equipment and inventory located on
leased premises or in warehouses, no lessor or warehouseman of any premises or
warehouse upon or in which such equipment or inventory is located has issued any
warehouse receipt or document, or received notification of any secured party’s
interest (other than the security interest granted hereunder or permitted by the
Credit Agreement) in Grantor’s equipment or inventory, or asserted any lien,
claim or charge (based on contract, statute or otherwise) on such equipment and
inventory.

 

(d) All filings and other actions (including, without limitation, actions
necessary to obtain control of Collateral as provided in Sections 9-105, 9-106
and 9-107 of the UCC) necessary to perfect the security interest in the
Collateral of Grantor created under this Agreement have been duly made or taken
and are in full force and effect, and this Agreement creates in favor of the
Lender a valid and, together with such filings and other actions, perfected
first priority security interest in the Collateral of Grantor, securing the
payment of the Secured Obligations.

 

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(e) No authorization or approval or other action by, and no notice to or filing
with, any governmental authority or regulatory body or any other third party is
required for (i) the grant by Grantor of the security interest granted hereunder
or for the execution, delivery or performance of this Agreement by Grantor, or
(ii) the perfection or maintenance of the security interest created hereunder
(including the first priority nature of such security interest), except for the
filing of financing and continuation statements under the UCC, which financing
statements have been duly filed and are in full force and effect.

 

Section 6. Further Assurances. Grantor agrees as follows:

 

(a) Grantor agrees that from time to time, at the expense of Grantor, Grantor
will promptly execute and deliver, or otherwise authenticate, all further
instruments and documents, and take all further action that may be necessary or
desirable, or that the Lender may request, in order to perfect and protect any
security interest granted or purported to be granted by Grantor hereunder or to
enable the Lender to exercise and enforce its rights and remedies hereunder with
respect to any Collateral of Grantor. Without limiting the generality of the
foregoing, Grantor will promptly, upon the written request of the Lender, with
respect to Collateral of Grantor: (i) mark conspicuously each document,
contract, and all chattel paper and, at the request of the Lender, each of its
records pertaining to such Collateral with a legend, in form and substance
satisfactory to the Lender, indicating that such Collateral or record is subject
to the security interest granted hereby; (ii) if any such Collateral shall be
evidenced by a promissory note or other instrument or chattel paper, deliver and
pledge to the Lender hereunder such note or instrument or chattel paper duly
indorsed and accompanied by duly executed instruments of transfer or assignment,
all in form and substance satisfactory to the Lender; (iii) execute or
authenticate and file such financing or continuation statements, or amendments
thereto, and such other instruments or notices, as may be necessary or
desirable, or as the Lender may request, in order to perfect and preserve the
security interest granted or purported to be granted by Grantor hereunder;
(iv) deliver and pledge to the Lender certificates representing Collateral, if
any, that constitutes certificated securities, accompanied by undated stock or
bond powers executed in blank; (v) take all action necessary to ensure that the
Lender has control of Collateral consisting of electronic chattel paper,
investment property, and transferable records as provided in Sections 9-105,
9-106 and 9-107 of the UCC; (vi) cause the Lender to be the beneficiary under
all letters of credit that constitute Collateral, with the exclusive right to
make all draws under such letters of credit, and with all rights of a transferee
under Section 5-114(e) of the UCC; and (vii) deliver to the Lender evidence that
all other action that the Lender may deem reasonably necessary or desirable in
order to perfect and protect the security interest created by Grantor under this
Agreement has been taken.

 

(b) Grantor hereby authorizes the Lender to file one or more financing or
continuation statements, and amendments thereto, including, without limitation,
one or more financing statements indicating that such financing statements cover
all assets or all personal property (or words of similar effect) of Grantor, in
each case without the signature of Grantor, and regardless of whether any
particular asset described in such financing statements falls within the scope
of the UCC or the granting clause of this Agreement. A photocopy or other
reproduction of this Agreement or any financing statement covering the
Collateral or any part thereof shall be sufficient as a financing statement
where permitted by law. Grantor ratifies its authorization for the Lender to
have filed such financing statements, continuation statements or amendments
filed prior to the date hereof.

 

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(c) Grantor will furnish to the Lender from time to time statements and
schedules further identifying and describing the Collateral of Grantor and such
other reports in connection with such Collateral as the Lender may reasonably
request, all in reasonable detail.

 

Section 7. Transfers and Other Liens. Grantor agrees that it will not (i) sell,
assign or otherwise dispose of, or grant any option with respect to, any of the
Collateral, except as permitted under the terms of the Credit Agreement, or
(ii) create or suffer to exist any lien upon or with respect to any of the
Collateral of Grantor except for the pledge, assignment and security interest
created under this Agreement and liens permitted under the Credit Agreement.

 

Section 8. Lender Appointed Attorney-in-Fact. Grantor hereby irrevocably
appoints the Lender as Grantor’s attorney-in-fact, with full authority in the
place and stead of Grantor and in the name of Grantor or otherwise, from time to
time upon the occurrence and during the continuance of an Event of Default, in
the Lender’s discretion, to take any action and to execute any instrument that
the Lender may deem necessary or advisable to accomplish the purposes of this
Agreement, including, without limitation:

 

(a) to obtain and adjust insurance claims,

 

(b) to ask for, demand, collect, sue for, recover, compromise, receive and give
acquittance and receipts for moneys due and to become due under or in respect of
any of the Collateral,

 

(c) to receive, indorse and collect any drafts or other instruments, documents
and chattel paper, in connection with clause (a) or (b) above, and

 

(d) to file any claims or take any action or institute any proceedings that the
Lender may deem necessary or desirable for the collection of any of the
Collateral or otherwise to enforce compliance with the terms and conditions of
any assigned agreement or the rights of the Lender with respect to any of the
Collateral.

 

Section 9. Lender May Perform. If Grantor fails to perform any agreement
contained herein, the Lender may, but without any obligation to do so and
without notice, itself perform, or cause performance of, such agreement, and the
expenses of the Lender incurred in connection therewith shall be payable by
Grantor.

 

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Section 10. The Lender’s Duties.

 

(a) The powers conferred on the Lender hereunder are solely to protect its
interest in the Collateral and shall not impose any duty upon it to exercise any
such powers. Except for the safe custody of any Collateral in its possession and
the accounting for moneys actually received by it hereunder, the Lender shall
have no duty as to any Collateral, as to ascertaining or taking action with
respect to calls, conversions, exchanges, maturities, tenders or other matters
relative to any Collateral, whether or not Lender has or is deemed to have
knowledge of such matters, or as to the taking of any necessary steps to
preserve rights against any parties or any other rights pertaining to any
Collateral. The Lender shall be deemed to have exercised reasonable care in the
custody and preservation of any Collateral in its possession if such Collateral
is accorded treatment substantially equal to that which it accords its own
property.

 

(b) Anything contained herein to the contrary notwithstanding, the Lender may
from time to time, when the Lender deems it to be necessary, appoint one or more
subagents (each a “Subagent”) for the Lender hereunder with respect to all or
any part of the Collateral. In the event that the Lender so appoints any
Subagent with respect to any Collateral, (i) the assignment and pledge of such
Collateral and the security interest granted in such Collateral by Grantor
hereunder shall be deemed for purposes of this Security Agreement to have been
made to such Subagent, in addition to the Lender, as security for the Secured
Obligations of Grantor, (ii) such Subagent shall automatically be vested, in
addition to the Lender, with all rights, powers, privileges, interests and
remedies of the Lender hereunder with respect to such Collateral, and (iii) the
term “Lender,” when used herein in relation to any rights, powers, privileges,
interests and remedies of the Lender with respect to such Collateral, shall
include such Subagent; provided, however, that no such Subagent shall be
authorized to take any action with respect to any such Collateral unless and
except to the extent expressly authorized in writing by the Lender.

 

Section 11. Remedies. If any Event of Default shall have occurred and be
continuing:

 

(a) The Lender may exercise in respect of the Collateral, in addition to other
rights and remedies provided for herein or otherwise available to it, all the
rights and remedies of a secured party upon default under the UCC (whether or
not the UCC applies to the affected Collateral) and also may: (i) require
Grantor to, and Grantor hereby agrees that it will at its expense and upon
request of the Lender forthwith, assemble all or part of the Collateral as
directed by the Lender and make it available to the Lender at a place and time
to be designated by the Lender that is reasonably convenient to both parties;
(ii) without notice except as specified below, sell the Collateral or any part
thereof in one or more parcels at public or private sale, at any of the Lender’s
offices or elsewhere, for cash, on credit or for future delivery, and upon such
other terms as the Lender may deem commercially reasonable; (iii) occupy any
premises owned or leased by the Grantor where the Collateral or any part thereof
is assembled or located for a reasonable period in order to effectuate its
rights and remedies hereunder or under law, without obligation to Grantor in
respect of such occupation; and (iv) exercise any and all rights and remedies of
any of the Grantor under or in connection with the Collateral, or otherwise in
respect of the Collateral, including, without limitation, (A) any and all rights
of Grantor to demand or otherwise require payment of any amount under, or
performance of any provision of the Collateral, (B) withdraw, or cause or direct
the withdrawal, of all funds with respect to the Collateral and (C) exercise all
other rights and remedies with respect to the Collateral, including, without
limitation, those set forth in Section 9-607 of the UCC. Grantor agrees that, to
the extent notice of sale shall be required by law, at least ten days’ notice to
Grantor of the time and place of any public sale or the time after which any
private sale is to be made shall constitute reasonable notification. The Lender
shall not be obligated to make any sale of Collateral regardless of notice of
sale having been given. The Lender may adjourn any public or private sale from
time to time by announcement at the time and place fixed therefor, and such sale
may, without further notice, be made at the time and place to which it was so
adjourned.

 

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(b) At any time during which the Lender is exercising its rights and remedies in
respect of the Collateral, any cash held by or on behalf of the Lender and all
cash proceeds received by or on behalf of the Lender in respect of any sale of,
collection from, or other realization upon all or any part of the Collateral
may, in the discretion of the Lender, be held by the Lender as collateral for,
and/or then or at any time thereafter applied (after payment of any amounts
payable to the Lender pursuant hereto) in whole or in part by the Lender
against, all or any part of the Secured Obligations. Any surplus of such cash or
cash proceeds held by or on the behalf of the Lender and remaining after payment
in full of all the Secured Obligations shall be paid over to the Grantor or to
whomsoever may be lawfully entitled to receive such surplus.

 

(c) All payments received by Grantor under or in connection with any Collateral
shall be received in trust for the benefit of the Lender, shall be segregated
from other funds of Grantor and shall be forthwith paid over to the Lender in
the same form as so received (with any necessary indorsement).

 

(d) The Lender may, without notice to Grantor except as required by law and at
any time or from time to time, charge, set-off and otherwise apply all or any
part of the Secured Obligations against any funds held with respect to the
Collateral.

 

Section 12. Indemnity and Expenses. \l 2(a) Grantor agrees to indemnify, defend
and save and hold harmless Lender and each of its Affiliates and their
respective officers, directors, employees, agents and advisors (each, an
“Indemnified Party”) from and against, and shall pay on demand, any and all
claims, damages, losses, liabilities and expenses (including, without
limitation, reasonable fees and expenses of counsel) that may be incurred by or
asserted or awarded against any Indemnified Party, in each case arising out of
or in connection with or resulting from this Agreement (including, without
limitation, enforcement of this Agreement), except to the extent such claim,
damage, loss, liability or expense is found in a final, non-appealable judgment
by a court of competent jurisdiction to have resulted from such Indemnified
Party’s gross negligence or willful misconduct.

 

Grantor will upon demand pay to the Lender the amount of any and all reasonable
expenses, including, without limitation, the reasonable fees and expenses of its
counsel and of any experts and agents, that the Lender may incur in connection
with (i) the administration of this Agreement, (ii) the custody, preservation,
use or operation of, or the sale of, collection from or other realization upon,
any of the Collateral of Grantor, (iii) the exercise or enforcement of any of
the rights of the Lender hereunder or (iv) the failure by Grantor to perform or
observe any of the provisions hereof.

 

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Section 13. Amendments; Waivers. No amendment or waiver of any provision of this
Agreement, and no consent to any departure by Grantor herefrom, shall in any
event be effective unless the same shall be in writing and signed by the Lender,
and then such waiver or consent shall be effective only in the specific instance
and for the specific purpose for which given. No failure on the part of the
Lender to exercise, and no delay in exercising any right hereunder, shall
operate as a waiver thereof; nor shall any single or partial exercise of any
such right preclude any other or further exercise thereof or the exercise of any
other right.

 

Section 14. Notices. All notices and other communications provided for hereunder
shall be given in accordance with the Verity Farms Guaranty executed by the
Grantor in favor of Lender.

 

Section 15. Continuing Security Interest; Assignments under the Credit
Agreement. This Agreement shall create a continuing security interest in the
Collateral and shall (a) remain in full force and effect until the latest of
(i) the payment in full in cash of the Secured Obligations and (ii) the
Termination Date, (b) be binding upon Grantor, its successors and assigns and
(c) inure, together with the rights and remedies of the Lender hereunder, to the
benefit of the Lender and its successors, transferees and assigns. Without
limiting the generality of the foregoing clause (c), Lender may assign or
otherwise transfer all or any portion of its rights and obligations under the
Credit Agreement (including, without limitation, all or any portion of its
commitment, the advances owing to it and the Note or Notes, if any, held by it)
to any other Person, and such other Person shall thereupon become vested with
all the benefits in respect thereof granted to Lender herein or otherwise.

 

Section 16. Release; Termination. \l 2(a) Upon any sale, lease, transfer or
other disposition of any item of Collateral of Grantor in accordance with the
terms of the Loan Documents (other than sales of inventory in the ordinary
course of business), the Lender will, at Grantor’s expense, execute and deliver
to Grantor such documents as Grantor shall reasonably request to evidence the
release of such item of Collateral from the assignment and security interest
granted hereby; provided, however, that (i) at the time of such request and such
release no Event of Default shall have occurred and be continuing, (ii) Grantor
shall have delivered to the Lender, at least ten Business Days (five days in the
case of the proposed sale of any individual vehicle on which Lender has a lien)
prior to the date of the proposed release, a written request for release
describing the item of Collateral and the terms of the sale, lease, transfer or
other disposition in reasonable detail, including, without limitation, the price
thereof and any expenses in connection therewith, together with a form of
release for execution by the Lender and a certificate of Grantor to the effect
that the transaction is in compliance with the Loan Documents and as to such
other matters as the Lender may request and (iii) the proceeds of any such sale,
lease, transfer or other disposition required to be applied, or any payment to
be made in connection therewith shall, to the extent so required under the
Credit Agreement, be paid or made to, or in accordance with the instructions of
the Lender.

 

(b) Upon the latest of (i) the payment in full in cash of the Secured
Obligations and (ii) the Termination Date, the security interest granted hereby
shall terminate and all rights to the Collateral shall revert to the Grantor.
Upon any such termination, the Lender will, at the Grantor’s expense, execute
and deliver to Grantor such documents as Grantor shall reasonably request to
evidence such termination.

 

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Section 17. Execution in Counterparts. This Agreement may be executed in any
number of counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement. Delivery of an executed counterpart of a signature page to this
Agreement by telecopier shall be effective as delivery of an original executed
counterpart of this Agreement.

 

Section 18. Governing Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of South Dakota.

 

IN WITNESS WHEREOF, Grantor has caused this Security Agreement to be duly
executed and delivered by its officer thereunto duly authorized as of the date
first above written.

 

  LENDER:         /s/ DUANE SPADER   Duane Spader         GRANTOR:        
Verity Corp.         By: /s/ RICHARD KAMOLVATHIN   Its:  

 

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Schedule I to the

Security Agreement

 

COLLATERAL

 

(a) All accounts, deposit accounts, contract rights, chattel paper, (whether
electronic or tangible) instruments, promissory notes, documents, general
intangibles (including, but not limited to, all rights under franchise
agreements, non-compete agreements and goodwill), payment intangibles, software,
letter of credit rights, health-care insurance receivables and other rights to
payment of every kind now existing or at any time hereafter arising.

 

(b) All inventory, goods held for sale or lease or to be furnished under
contracts for service, or goods so leased or furnished, raw materials, component
parts, work in process, farm products and other materials used or consumed in
Grantor’s business, now or at any time hereafter owned or acquired by Grantor,
wherever located, and all products thereof, whether in the possession of
Grantor, any warehousemen, any bailee or any other person, or in process of
delivery, and whether located in Grantor’s place of business or elsewhere;

 

(c) All warehouse receipts, bills of sale, bills of lading and other documents
of every kind (whether or not negotiable) in which Grantor now has or at any
time hereafter acquires any interest, and all additions and accessions thereto,
whether in the possession or custody of Grantor, any bailee or any other person
for any purpose;

 

(d) All money and property heretofore, now or hereafter delivered to or
deposited with Lender or otherwise coming into the possession, custody or
control of Lender (or any agent or bailee of Lender) in any manner or for any
purpose whatsoever during the existence of this Agreement and whether held in a
general or special account or deposit for safekeeping or otherwise;

 

(e) All right, title and interest of Grantor under licenses, guaranties,
warranties, management agreements, marketing or sales agreements, escrow
contracts, indemnity agreements, insurance policies, service or maintenance
agreements, supporting obligations and other similar contracts of every kind in
which Grantor now has or at any time hereafter shall have an interest;

 

(f) All goods, tools, machinery, furnishings, furniture and other equipment and
fixtures of every kind now existing or hereafter acquired, and all improvements,
replacements, accessions and additions thereto and embedded software included
therein, whether located on any property owned or leased by Grantor or
elsewhere, including without limitation, any of the foregoing now or at any time
hereafter located at or installed on the land or in the improvements at any of
the real property owned or leased by Grantor, and all such goods after they have
been severed and removed from any of said real property; and

 

(g) All motor vehicles, trailers, mobile homes, manufactured homes, boats, other
rolling stock and related equipment of every kind now existing or hereafter
acquired and all additions and accessories thereto, whether located on any
property owned or leased by Grantor or elsewhere;

 

together with whatever is receivable or received whether any of the foregoing or
the proceeds thereof are sold, leased, collected, exchanged or otherwise
disposed of, whether such disposition is voluntary or involuntary, including
without limitation, all rights to payment, including returned premiums, with
respect to any insurance relating to any of the foregoing, and all rights to
payment with respect to any claim or cause of action affecting or relating to
any of the foregoing.

 

 

 

 

Schedule II to the

Security Agreement

  

LOCATION, CHIEF EXECUTIVE OFFICE, BUSINESS LOCATIONS, TYPE OF ORGANIZATION,
JURISDICTION OF ORGANIZATION AND ORGANIZATIONAL IDENTIFICATION NUMBER

 

 
 
Grantor   
 
Location  Chief Executive Office  Business Locations   Type of Organization  
 Jurisdiction of Organization   Organizational ID No.   EIN                  
            Verity Corp.  47184 258th St., Sioux Falls, SD 57107-6433  Same 
Same
 
   Corporation    NV   NV20061630801   38-3767357