EX-10.5



 





Exhibit 10.5









Dated as of October 4, 2007




SECURITY AGREEMENT




          1. THE SECURITY. PREMIER EXHIBITIONS, INC. (the “Pledgor”), a Florida corporation,
hereby assigns and grants to BANK OF AMERICA, N.A. (the “Bank”) a security interest in the
following described property now owned or hereafter acquired by the Pledgor (collectively, the
“Collateral”):





          (a) All accounts, contract rights, chattel paper, instruments, deposit accounts, letter
of credit rights, payment intangibles and general intangibles, including all amounts due to
the Pledgor from a factor; rights to payment of money from the Bank under any Swap Contract
(as defined herein); and all returned or repossessed goods which, on sale or lease, resulted
in an account or chattel paper.




          (b) All inventory, including all materials, work in process and finished goods.




          (c) All machinery, furniture, fixtures and other equipment of every type now owned or
hereafter acquired by the Pledgor.




          (d) All of the Pledgor’s deposit accounts with the Bank. The Collateral shall include
any renewals or rollovers of the deposit accounts, any successor accounts, and any general
intangibles and choses in action arising therefrom or related thereto.




          (e) All instruments, notes, chattel paper, documents, certificates of deposit,
securities and investment property of every type. The Collateral shall include all liens,
security agreements, leases and other contracts securing or otherwise relating to the
foregoing.




          (f) All general intangibles, including, but not limited to, (i) all patents, and all
unpatented or unpatentable inventions; (ii) all trademarks, service marks, and trade names;
(iii) all copyrights and literary rights; (iv) all computer software programs; (v) all mask
works of semiconductor chip products; (vi) all trade secrets, proprietary information,
customer lists, manufacturing, engineering and production plans, drawings, specifications,
processes and systems. The Collateral shall include all goodwill connected with or
symbolized by any of such general intangibles; all contract rights, documents, applications,
licenses, materials and other matters related to such general intangibles; all tangible
property embodying or incorporating any such general intangibles; and all chattel paper and
instruments relating to such general intangibles.




          (g) All negotiable and nonnegotiable documents of title covering any Collateral.




          (h) All accessions, attachments and other additions to the Collateral, and all tools,
parts and equipment used in connection with the Collateral.




          (i) All substitutes or replacements for any Collateral, all cash or non-cash proceeds,
product, rents and profits of any Collateral, all income, benefits and property receivable
on account of the Collateral, all rights under warranties and insurance contracts, letters
of credit, guaranties or other supporting obligations covering the Collateral, and any
causes of action relating to the Collateral.




          (j) All books and records pertaining to any Collateral, including but not limited to
any computer-readable memory and any computer hardware or software necessary to process such
memory (“Books and Records”).



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          2. THE INDEBTEDNESS. The Collateral secures and will secure all Indebtedness of the
Pledgor to the Bank. Each party obligated under any Indebtedness is referred to in this Agreement
as a “Debtor.” “Indebtedness” means all debts, obligations or liabilities now or hereafter
existing, absolute or contingent of the Debtor or any one or more of them to the Bank, whether
voluntary or involuntary, whether due or not due, or whether incurred directly or indirectly or
acquired by the Bank by assignment or otherwise. Indebtedness shall include, without limitation,
all obligations of the Debtor arising under any Swap Contract. “Swap Contract” means any interest
rate, credit, commodity or equity swap, cap, floor, collar, forward foreign exchange transaction,
currency swap, cross currency rate swap, currency option, securities puts, calls, collars, options
or forwards or any combination of, or option with respect to, these or similar transactions now or
hereafter entered into between the Debtor and the Bank.




          3. PLEDGOR’S COVENANTS. The Pledgor represents, covenants and warrants that unless
compliance is waived by the Bank in writing:





          (a) The Pledgor will properly preserve the Collateral; defend the Collateral against
any adverse claims and demands; and keep accurate Books and Records.




          (b) The Pledgor’s chief executive office is located, in Atlanta, Georgia. In addition,
the Pledgor is incorporated in or organized under the laws of Florida. The Pledgor shall
give the Bank at least thirty (30) days notice before changing its residence or its chief
executive office or state of incorporation or organization. The Pledgor will notify the
Bank in writing prior to any change in the location of any Collateral, including the Books
and Records.




          (c) The Pledgor will notify the Bank in writing prior to any change in the Pledgor’s
name, identity or business structure.




          (d) Unless otherwise agreed, the Pledgor has not granted and will not grant any
security interest in any of the Collateral except to the Bank, and will keep the Collateral
free of all liens, claims, security interests and encumbrances of any kind or nature except
the security interest of the Bank.




          (e) The Pledgor will promptly notify the Bank in writing of any event which affects the
value of the Collateral, the ability of the Pledgor or the Bank to dispose of the
Collateral, or the rights and remedies of the Bank in relation thereto, including, but not
limited to, the levy of any legal process against any Collateral and the adoption of any
marketing order, arrangement or procedure affecting the Collateral, whether governmental or
otherwise.




          (f) The Pledgor shall pay all costs necessary to preserve, defend, enforce and collect
the Collateral, including but not limited to taxes, assessments, insurance premiums,
repairs, rent, storage costs and expenses of sales, and any costs to perfect the Bank’s
security interest (collectively, the “Collateral Costs”). Without waiving the Pledgor’s
default for failure to make any such payment, the Bank at its option may pay any such
Collateral Costs, and discharge encumbrances on the Collateral, and such Collateral Costs
payments shall be a part of the Indebtedness and bear interest at the rate set out in the
Indebtedness. The Pledgor agrees to reimburse the Bank on demand for any Collateral Costs
so incurred.




          (g) Until the Bank exercises its rights to make collection, the Pledgor will diligently
collect all Collateral.




          (h) If any Collateral is or becomes the subject of any registration certificate,
certificate of deposit or negotiable document of title, including any warehouse receipt or
bill of lading, the Pledgor shall immediately deliver such document to the Bank, together
with any necessary endorsements.



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          (i) The Pledgor will not sell, lease, agree to sell or lease, or otherwise dispose of
any Collateral except with the prior written consent of the Bank; provided, however, that
the Pledgor may sell inventory and artifacts, subject to the limitations set forth in the
Loan Agreement, in the ordinary course of business. For purposes hereof, the “Loan
Agreement” means that certain Loan Agreement even date herewith by and between the Pledgor
and the Bank, as the same may be amended or restated from time to time.




          (j) The Pledgor will maintain and keep in force all risk property damage insurance
policies (including without limitation windstorm coverage, and hurricane coverage as
applicable) covering the tangible property comprising the Collateral. Each insurance policy
must be for the full replacement cost of the collateral and include a replacement cost
endorsement. The insurance must be issued by an insurance company acceptable to the Bank
and must include a lender’s loss payable endorsement in favor of the Bank in a form
acceptable to the Bank. Upon the request of the Bank, the Pledgor will deliver to the bank
a copy of each insurance policy, or, if permitted by the Bank, a certificate of insurance
listing all insurance in force.




          (k) The Pledgor will not attach any Collateral to any real property or fixture in a
manner which might cause such Collateral to become a part thereof unless the Pledgor first
obtains the written consent of any owner, holder of any lien on the real property or
fixture, or other person having an interest in such property to the removal by the Bank of
the Collateral from such real property or fixture. Such written consent shall be in form
and substance acceptable to the Bank and shall provide that the Bank has no liability to
such owner, holder of any lien, or any other person.



          4. ADDITIONAL OPTIONAL REQUIREMENTS. The Pledgor agrees that the Bank may at its
option at any time, whether or not the Pledgor is in default:





          (a) Require the Pledgor to deliver to the Bank (i) copies of or extracts from the Books
and Records, and (ii) information on any contracts or other matters affecting the
Collateral.




          (b) Examine the Collateral, including the Books and Records, and make copies of or
extracts from the Books and Records, and for such purposes enter at any reasonable time upon
the property where any Collateral or any Books and Records are located.




          (c) Require the Pledgor to deliver to the Bank any instruments, chattel paper or
letters of credit which are part of the Collateral, and to assign to the Bank the proceeds
of any such letters of credit.




          (d) Notify any account debtors, any buyers of the Collateral, or any other persons of
the Bank’s interest in the Collateral.



          5. DEFAULTS. Any one or more of the following shall be a default hereunder:





          (a) Any Indebtedness is not paid when due, or any default occurs under any agreement
relating to the Indebtedness, after giving effect to any applicable grace or cure periods.




          (b) The Pledgor breaches any term, provision, warranty or representation under this
Agreement, or under any other obligation of the Pledgor to the Bank, and such breach remains
uncured after any applicable cure period.




          (c) The Bank fails to have an enforceable first lien (except for any prior liens to
which the Bank has consented in writing) on or security interest in the Collateral.



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          (d) Any custodian, receiver or trustee is appointed to take possession, custody or
control of all or a substantial portion of the property of the Pledgor or of any guarantor
or other party obligated under any Indebtedness.




          (e) The Pledgor or any guarantor or other party obligated under any Indebtedness
becomes insolvent, or is generally not paying or admits in writing its inability to pay its
debts as they become due, fails in business, makes a general assignment for the benefit of
creditors, dies, or commences any case, proceeding or other action under any bankruptcy or
other law for the relief of, or relating to, debtors.




          (f) Any case, proceeding or other action is commenced against the Pledgor or any
guarantor or other party obligated under any Indebtedness under any bankruptcy or other law
for the relief of, or relating to, debtors.




          (g) Any involuntary lien of any kind or character attaches to any Collateral, except
for liens for taxes not yet due.




          (h) The Pledgor has given the Bank any false or misleading information or
representations.



          6. BANK’S REMEDIES AFTER DEFAULT. In the event of any default, the Bank may do any
one or more of the following:





          (a) Declare any Indebtedness immediately due and payable, without notice or demand.




          (b) Enforce the security interest given hereunder pursuant to the Uniform Commercial
Code and any other applicable law.




          (c) Enforce the security interest of the Bank in any deposit account of the Pledgor
maintained with the Bank by applying such account to the Indebtedness.




          (d) Require the Pledgor to obtain the Bank’s prior written consent to any sale, lease,
agreement to sell or lease, or other disposition of any Collateral consisting of inventory.




          (e) Require the Pledgor to segregate all collections and proceeds of the Collateral so
that they are capable of identification and deliver daily such collections and proceeds to
the Bank in kind.




          (f) Require the Pledgor to direct all account debtors to forward all payments and
proceeds of the Collateral to a post office box under the Bank’s exclusive control.




          (g) Require the Pledgor to assemble the Collateral, including the Books and Records,
and make them available to the Bank at a place designated by the Bank.




          (h) Enter upon the property where any Collateral, including any Books and Records, are
located and take possession of such Collateral and such Books and Records, and use such
property (including any buildings and facilities) and any of the Pledgor’s equipment, if the
Bank deems such use necessary or advisable in order to take possession of, hold, preserve,
process, assemble, prepare for sale or lease, market for sale or lease, sell or lease, or
otherwise dispose of, any Collateral.




          (i) Demand and collect any payments on and proceeds of the Collateral. In connection
therewith the Pledgor irrevocably authorizes the Bank to endorse or sign the Pledgor’s name
on all checks, drafts, collections, receipts and other documents, and to take possession of



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and open the mail addressed to the Pledgor and remove therefrom any payments and proceeds of
the Collateral.




          (j) Grant extensions and compromise or settle claims with respect to the Collateral for
less than face value, all without prior notice to the Pledgor.




          (k) Use or transfer any of the Pledgor’s rights and interests in any Intellectual
Property now owned or hereafter acquired by the Pledgor, if the Bank deems such use or
transfer necessary or advisable in order to take possession of, hold, preserve, process,
assemble, prepare for sale or lease, market for sale or lease, sell or lease, or otherwise
dispose of, any Collateral. The Pledgor agrees that any such use or transfer shall be
without any additional consideration to the Pledgor. As used in this paragraph,
“Intellectual Property” includes, but is not limited to, all trade secrets, computer
software, service marks, trademarks, trade names, trade styles, copyrights, patents,
applications for any of the foregoing, customer lists, working drawings, instructional
manuals, and rights in processes for technical manufacturing, packaging and labeling, in
which the Pledgor has any right or interest, whether by ownership, license, contract or
otherwise.




          (l) Have a receiver appointed by any court of competent jurisdiction to take possession
of the Collateral. The Pledgor hereby consents to the appointment of such a receiver and
agrees not to oppose any such appointment.




          (m) Take such measures as the Bank may deem necessary or advisable to take possession
of, hold, preserve, process, assemble, insure, prepare for sale or lease, market for sale or
lease, sell or lease, or otherwise dispose of, any Collateral, and the Pledgor hereby
irrevocably constitutes and appoints the Bank as the Pledgor’s attorney-in-fact to perform
all acts and execute all documents in connection therewith.




          (n) Without notice or demand to the Pledgor, set off and apply against any and all of
the Indebtedness any and all deposits (general or special, time or demand, provisional or
final) and any other indebtedness, at any time held or owing by the Bank or any of the
Bank’s agents or affiliates to or for the credit of the account of the Pledgor or any
guarantor or endorser of the Pledgor’s Indebtedness.




          (o) Exercise any other remedies available to the Bank at law or in equity.



     EXECUTED and delivered as of the day and year first above written.



	 	 	 	 	 	 	 	 	 	 	 
	 	 	PREMIER EXHIBITIONS, INC.	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	Arnie Geller, Its President	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	(SEAL)	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	BANK OF AMERICA, N.A.	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Its:	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 






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