Document:

activecareexh102.htm

Exhibit 10.2

SECURED PROMISSORY NOTE

$1,713,000.00  November __, 2012

THIS SECURED PROMISSORY NOTE (this “Note”) is made by GWIRE CORPORATION, a Utah corporation (“Maker”), having an address of 5095 West 2100 South, Salt Lake City, Utah 84120, to and in favor of Green Wire, LLC, a Utah limited liability company (“Payee” or “Holder”), having an address at 4424 South 700 East, Suite 200, Salt Lake City, Utah 84107.  Maker has executed and delivered this Note pursuant to the terms of that certain Asset Purchase Agreement dated as of even date herewith (the “Purchase Agreement”), by and among Maker, as Purchaser, and Payee, as a Seller along with ActiveCare, Inc. and the other Sellers identified therein.  All promissory notes issued pursuant to the Asset Purchase Agreement are collectively referred to herein as the “Notes.”  Capitalized terms used but not otherwise defined herein, shall have the meaning ascribed to them in the Purchase Agreement.

 

FOR VALUE RECEIVED, Maker promises to pay to the Holder or registered assigns, the principal sum of ONE MILLION SEVEN HUNDRED THIRTEEN THOUSAND AND 00/100 DOLLARS ($1,713,000.00), representing 63.67601% of the aggregate principal amount of all of the Notes issued pursuant to the Purchase Agreement, together with interest on the unpaid principal balance thereof at the rate of one fourth of one percent (0.25%) per annum on the basis of a 365-day year, payable in monthly payments of interest and principal in the amount of FORTY-SEVEN THOUSAND SEVEN HUNDRED FIFTY-SEVEN AND 01/100 DOLLARS ($47,757.01), with the first payment commencing on November __, 2012, and subsequent payments continuing on the first day of each calendar month thereafter (each a “Payment Date” and collectively the “Payment Dates”) until 63.67601% of the aggregate principal and accrued interest is paid in full to all Sellers as provided in the Payment Schedule attached as Attachment I.  All payments received on account of this Note shall be applied as follows: First to any costs of collection incurred by Holder in collecting the same; Second, to any late charge; Third, to accrued interest; and Fourth, to principal.  Maker shall pay all payments of principal and interest hereunder in United States currency and shall deliver the same to Holder at the address of Holder set forth above, provided that Holder may direct payment to another address by written notice to Maker at the address of Maker listed above, or such other address of Maker as Maker may advise in writing.

 

This Note is subject to the following additional provisions:

 

Section 1.                      Default.

 

(a)           “Event of Default” wherever used herein means any one or more of the following events or conditions (whatever the reason and whether it shall be voluntary or involuntary or effected by operation of law or pursuant to any judgment, decree or order of any court, or any order, rule or regulation of any administrative or governmental body):

 

(i)           any default by Maker in the payment of principal or interest payable in respect of any of the Notes;

 

  

1

  

 

(ii)           any material inaccuracy of any representation or warranty of Maker contained in this Note, the Purchase Agreement, the Security Agreement, the Assignment and Assumption Agreement, or any other document or instrument given, made or entered into by Maker with respect to the sale of the Assets contemplated by the Purchase Agreement (collectively, the “Transaction Agreements”);

 

(iii)           any failure of Maker to timely observe or perform any material covenant or agreement set forth in this Note or in any other Transaction Agreement, and such failure or breach shall not have been remedied within thirty (30) days after the date on which reasonably detailed notice of such failure or breach shall have been given by Holder or its successor;

 

(iv)           Maker commences a voluntary case under the United States Bankruptcy Code or insolvency laws as now or hereafter in effect or any successor thereto (the “Bankruptcy Code”); or an involuntary case is commenced against Maker under the Bankruptcy Code and the petition is not dismissed within sixty (60) days, after commencement of such involuntary case; or a “custodian” (as defined in the Bankruptcy Code) is appointed for, or takes charge of, all or any substantial part of the property of Maker or Maker commences any other proceeding under any reorganization, arrangement, adjustment of debt, relief of debtors, dissolution, insolvency or liquidation or similar law of any jurisdiction whether now or hereafter in effect relating to Maker or there is commenced against Maker any such proceeding that remains undismissed for a period of sixty (60) days; or Maker is adjudicated insolvent or bankrupt; or any order of relief or other order approving any such case or proceeding is entered; or Maker suffers any appointment of any custodian or the like for it or any substantial part of its property which continues undischarged or unstayed for a period of sixty (60) days; or Maker makes a general assignment for the benefit of creditors; or Maker fails to pay, or states that it is unable to pay its debts generally as they become due; or Maker calls a meeting of all of its creditors with a view to arranging a composition or adjustment of its debts; or Maker by any act or failure to act indicates its consent to, approval of or acquiescence in any of the foregoing; or any corporate or other action is taken by Maker for the purpose of effecting any of the foregoing; or

 

(v)           Maker is a party to any Change of Control Transaction (as defined in Section 6 below), or agrees to sell or dispose of all or in excess of 49% of its assets (based on book value calculation as reflected in Maker’s most recent financial statements) in one or more transactions (whether or not such sale would constitute a Change of Control Transaction).

 

(vi)           The maturity of any material indebtedness of Maker (other than the indebtedness on this Note) shall be accelerated or Maker shall fail to pay any such material indebtedness when due or, in the case of indebtedness payable on demand, when demanded, or any event shall occur or condition shall exist and shall have the effect of causing, or permitting the holder of any such indebtedness to cause, such material indebtedness to become due prior to its stated maturity or to realize upon and collateral given as security therefor.  For these purposes, indebtedness of Maker shall be deemed material if it exceeds $25,000 as to any item of indebtedness or in the aggregate for all items of indebtedness with respect to which any of the events described in this paragraph has occurred.

 

  

2

  

 

(vii)           A judgment or judgments for the payment of money in excess of the sum of $25,000 in the aggregate shall be rendered against Maker and Maker shall not discharge the same or provide for its discharge, or procure a stay of execution thereof, prior to any execution on such judgment, within 30 days from the date of entry thereof, and within said period of 30 days, or such longer period during which execution shall be stayed, appeal therefrom and cause the execution to be stayed during such appeal.

 

(viii)           Any execution or attachment shall be issued whereby any substantial part of the property of Maker shall be taken or attempted to be taken and the same shall not have been vacated or stayed within 30 days after the issuance thereof.

 

Section 2.                      Effect of Default.

 

(a)           Upon the occurrence of an Event of Default, Holder may (i) without further notice or demand (which are hereby waived), declare the entire unpaid principal amount of this Note and all accrued interest thereon immediately due and payable, except that upon the occurrence of an Event of Default described in Section 1(a)(iv), the entire principal amount and all accrued interest thereon shall automatically be deemed to be immediately due and payable without any action by Holder; and (ii) proceed to protect and enforce its rights either by suit in equity and/or by action at law, or by other appropriate proceedings, whether for the specific performance of any covenant or agreement contained in this Note or any other Transaction Agreement or in aid of the exercise of any power or right granted by this Note or any other Transaction Agreement or to enforce any other legal or equitable right of Holder.

 

(b)           Upon the occurrence of an Event of Default, as defined herein, all amounts due hereunder shall bear interest at the rate of eighteen percent (18%) per annum from the day an Event of Default occurs through and including the date of payment of any delinquent amount.

 

Section 3.                      Late Fee.  If any installment or payment provided to be made hereunder has not been paid in full by the Payment Date for such payment, Holder, in addition to any and all other remedies, shall have the right to receive from Maker a late charge equal to five percent (5%) of the amount of the delinquent payment.

 

Section 4.                      Interest Rate Limitation. The parties intend to conform strictly to the applicable usury laws in effect from time to time during the term hereof.  Accordingly, if any transaction contemplated hereby would be usurious under such laws, then notwithstanding any other provision hereof: (i) the aggregate of all interest that is contracted for, charged, or received under this Agreement shall not exceed the maximum amount of interest allowed by applicable law (the “Highest Lawful Rate”), and any excess shall be promptly credited to Maker by Holder (or, to the extent that such consideration shall have been paid, such excess shall be promptly refunded to Maker by Holder); (ii) neither Maker nor any other Person now or hereafter liable hereunder shall be obligated to pay the amount of such interest to the extent that it is in excess of the Highest Lawful Rate; and (iii) the effective rate of interest shall be reduced to the Highest Lawful Rate.

 

Section 5.                      Prepayment. Maker shall have the right to prepay this Note in whole or in part at any time.  Any such prepayment shall be applied to then accrued interest and then principal but shall not affect the amount of each payment of principal and interest otherwise required hereunder except in the case of any prepayment in full of this Note, the amount due and payable in full satisfaction of this Note shall be determined as if the Maker’s obligation under this Note were to pay 63.67601% of the aggregate principal and accrued interest that would be payable to the Sellers according to the Hypothetical Payment Schedule attached as Attachment II (and as if the annual interest rate applicable to this Note were the nominal annual rate set forth in such Hypothetical Payment Schedule).

 

  

3

  

 

Section 6.                      Definitions.  For the purposes hereof, the following terms shall have the following meanings:

 

(a)           “Business Day” means any day except Saturday, Sunday and any day which shall be a legal holiday or a day on which banking institutions in the State of Utah are authorized or required by law or other government action to close.

 

(b)           “Change of Control Transaction” means the occurrence of any of (i) an acquisition after the date hereof by an individual or legal entity or “group” (as described in Rule 13d-5(b)(1) promulgated under the Securities Exchange Act of 1934) of in excess of 49% of the voting securities of Maker, or (ii) the merger of Maker with or into another entity, consolidation or sale of all or substantially all of the assets of Maker in one or a series of related transactions, unless following such transaction, the holders of Maker’s securities continue to hold a majority of the total outstanding voting securities of the entity surviving such transaction or series of transactions.  The execution by Maker of an agreement to which Maker is a party or by which it is bound providing for any of the events set forth above in clauses (i) or (ii) above shall constitute the occurrence of an Event of Default without regard to whether an actual Change of Control Transaction in fact occurs.

 

Section 7.                      Substitution.  If this Note is mutilated, lost, stolen or destroyed, Maker shall execute and deliver, in exchange and substitution for and upon cancellation of a mutilated Note, or in lieu of or in substitution for a lost, stolen or destroyed Note, a new Note for the principal amount of this Note so mutilated, lost, stolen or destroyed but only upon receipt of evidence of such loss, theft or destruction of such Note, and of the ownership hereof, and indemnity, if requested, all reasonably satisfactory to Maker.

 

Section 8.                      Choice of Law; Venue.  This Note shall be governed by and construed in accordance with the laws of the State of Utah.  Maker consents to the exclusive jurisdiction of the federal courts or the state courts of the State of Utah sitting in Salt Lake County, Utah in connection with any dispute arising under this Agreement and hereby waives, to the maximum extent permitted by law, any objection, including any objection based on forum non coveniens, to the bringing of any such proceeding in such jurisdictions. To the extent determined by such court, Maker shall reimburse Holder for any reasonable legal fees and disbursements incurred by Holder in enforcement of or protection of any of its rights under this Note or the Security Agreement. MAKER HEREBY WAIVES THE RIGHT TO TRIAL BY JURY IN ANY ACTION, SUIT, PROCEEDING, OR COUNTERCLAIM OF ANY KIND ARISING OUT OF OR RELATED TO THIS NOTE.

 

  

4

  

 

Section 9.                      Waiver.  Any waiver by Holder of a breach of any provision of this Note shall not operate as or be construed to be a waiver of any other breach of such provision or of any breach of any other provision of this Note.  The failure of Holder to insist upon strict adherence to any term of this Note on one or more occasions shall not be considered a waiver or deprive that party of the right thereafter to insist upon strict adherence to that term or any other term of this Note.  Any waiver must be in writing.

 

Section 10.                      Severability.  If any provision of this Note is invalid, illegal or unenforceable, the balance of this Note shall remain in effect, and if any provision is inapplicable to any person or circumstance, it shall nevertheless remain applicable to all other persons and circumstances.

 

Section 11.                      Business Day.  Whenever any payment or other obligation hereunder shall be due on a day other than a Business Day, such payment shall be made on the next succeeding Business Day.

 

Section 12.                      Notices.  All notices, requests, demands, claims, and other communications hereunder will be in writing and shall be given in the manner set forth in the Purchase Agreement.

 

Section 13.                      Security.  The obligation of Maker for payment of principal, interest and all other sums hereunder, in the event of default by Maker to perform hereunder, is secured by the Security Agreement, by reference made a part of the terms of this Note.

 

Section 14.                      Waiver of Presentment. The Maker hereby waives presentment for payment, notice of dishonor, protest and notice of protest.

 

Section 15.                      Costs of Collection.  If this Note is not paid when due, the Maker shall pay all of the Payee’s costs of collection including reasonable attorneys’ fees.

 

Section 16.                      Amendment.  Any term of this Note may be amended and the observance of any term of this Note may be waived (either generally or in a particular instance and either retroactively or prospectively), only with the written consent of the Company and the holders of the Notes representing a majority of the aggregate face value of all Notes then outstanding; provided, however, that the written consent of any holder of a Note that would be adversely affected by such amendment or waiver in a manner disproportionate to the other holders of Notes shall be also be required.

 

[Signature page follows immediately]

  

5

  

IN WITNESS WHEREOF, Maker has caused this Secured Promissory Note to be duly executed by an officer duly authorized for such purpose, as of the date first above indicated.

	  	
MAKER:

	
GWIRE CORPORATION

	  	  	  
	  	  	  
	  	
By:

	  
	  	
Its:

	  
	  	  	  

  

6

  

Attachment I

Payment Schedule

 

 

 

  

7

  

 

Attachment II

Hypothetical Payment Schedule

 

 

 

8activecareexh103.htm

Exhibit 10.3

SECURITY AGREEMENT

 

 

This SECURITY AGREEMENT (this “Agreement”) is dated as of November ___, 2012, and is entered into by and between GWire Corporation, a Utah corporation (the “Company”); Rapid Medical Response, LLC, a Utah limited liability company (“Rapid”); Orbit Medical Response, LLC, a Utah limited liability company (“Response”);  and Green Wire, LLC, a Utah limited liability company (“Green Wire”).  Rapid, Response and Green Wire are referred to individually herein as a “Secured Party” and collectively as the “Secured Parties.”  Green Wire shall act as the collateral agent (the “Collateral Agent”) for the Secured Parties.

 

WHEREAS, the Company has entered into an Asset Purchase Agreement dated of even date herewith by and among the Company and the Secured Parties (the “Purchase Agreement”), pursuant to which the Company issued Secured Promissory Notes in the aggregate principal amount of $2,690,181 (the “Loan Amount”) to the Secured Parties (as they may hereafter be further amended, restated, supplemented or otherwise modified from time to time, the “Notes”).

 

WHEREAS, it is a condition precedent to the Secured Parties’ purchase of the Notes pursuant to the Purchase Agreement that the Company shall have granted the security interest and undertaken the obligations contemplated by this Agreement.

 

NOW, THEREFORE, in consideration of the foregoing premises, the agreements and covenants set forth herein, and in order to induce the Secured Parties to purchase the Notes, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows:

 

1. Security Interest.  The Company hereby pledges to the Collateral Agent and grants to the Collateral Agent, for the ratable benefit of each Security Party, a security interest (a “Security Interest”) in all of the Company’s right, title, interest, claims and demands in and to the Assets as defined in Section 2.1 and further described in Section 2.2 of the Purchase Agreement, by this reference made a part hereof, and restated on the attached Schedule I (the “Collateral”), together with:

 

(a) without limiting the generality of the foregoing, in addition to the customer lists and relationships included in the Assets, all additional customers obtained by the Company from the Effective Time (as defined in the Purchase Agreement) until the Closing Date (as defined in the Purchase Agreement);

 

(b) all books, records, files, correspondence, computer programs, tapes, disks and related data processing software that at any time evidence or contain information relating to any of the Collateral or are otherwise necessary or helpful in the collection thereof or realization thereupon; and

 

(c) all proceeds, products, rents and profits of or from any and all of the foregoing Collateral and, to the extent not otherwise included, all payments under insurance (whether or not the Collateral Agent or any Secured Party is the loss payees thereof), or any indemnity, warranty or guaranty, payable by reason of loss or damage to or otherwise with respect to any of the foregoing Collateral.  For purposes of this Agreement, the term “proceeds” includes whatever is receivable or received when Collateral or proceeds are sold, exchanged, collected or otherwise disposed of, whether such disposition is voluntary or involuntary.

 

  

1

  

 

Notwithstanding anything herein to the contrary, in no event shall the Collateral include, and the Company shall not be deemed to have granted a security interest in (i) any item of Collateral that is leased to it and for which it has not exercised any applicable purchase option; (ii) any of its rights or interests in any license, contract or agreement to which it is a party or any of its rights or interests thereunder to the extent, but only to the extent, that such a grant would, under the terms of such license, contract or agreement or otherwise, result in a breach of the terms of, or constitute a default under, any license, contract or agreement to which it is a party (other than to the extent that any such term would be rendered ineffective pursuant to Section 9-406 of the UCC or any other applicable law (including the United States Bankruptcy Code (the “Bankruptcy Code”)) or principles of equity); provided, that immediately upon the ineffectiveness, lapse or termination of any such provision, the Collateral shall include, and the Company shall be deemed to have granted a security interest in, all such rights and interests as if such provision had never been in effect; or (iii) any real property leasehold.

 

2. Priority.  It is intended that the Security Interest will be of equal priority as among, and for the ratable benefit of, the Secured Parties.

 

3. Obligations.  This Security Interest is given as security for all indebtedness and obligations owed by the Company to each Secured Party, whether now existing or hereafter incurred, under this Agreement, the Purchase Agreement, or the Notes, together with all extensions, modifications, or renewals thereof (collectively, the “Obligations”).

 

4. Title; Filing.  The Company warrants that it is the owner of the Collateral free and clear of all Material Liens (as defined below), claims, encumbrances, and security interests.  The Company authorizes the Collateral Agent to file financing statements, continuation statements, amendments, and other similar documents and instruments covering the Collateral and containing such legends as the Collateral Agent shall deem necessary or desirable to perfect or protect the interests of the Secured Parties in the Collateral.  The Company agrees to pay all taxes, fees and costs (including attorneys’ fees) paid or incurred by the Collateral Agent in connection with the preparation, filing or recordation thereof.  The Company waives receipt of any such financing statements that are registered by the Collateral Agent and any confirmation of registration.  On written demand by the Collateral Agent, the Company shall (i) furnish further assurance of title, (ii) execute any written instrument or do any other acts reasonably necessary to make effective the purposes and provisions of this Agreement, (iii) execute any instrument or statement required by law or otherwise in order to perfect or continue in full force and effect the security interest of the Secured Parties in the Collateral and pay all costs of filing in connection therewith, and (iv) join with the Collateral Agent in executing one or more financing and continuation statements pursuant to the Uniform Commercial Code (the “UCC”) in form satisfactory to the Collateral Agent and will pay the cost of filing the same or filing or recording this Agreement in all public offices wherever filing or recording is deemed by the Collateral Agent to be necessary or desirable.  At the option of the Collateral Agent, a carbon, photographic or other reproduction of this Agreement or of a financing statement executed in connection herewith shall be sufficient as and constitute a financing statement.  “Material Liens,” for purposes of this Agreement, shall mean liens of any kind other than liens of landlords and liens of carriers, warehousemen, mechanics and materialmen and other similar liens imposed by law arising in the ordinary course of business for sums not yet due and payable, and other liens or imperfections on property other than liens securing indebtedness which do not adversely affect title to, detract from the value of, or impair the existing use of or marketability of, the property affected by such lien or imperfection.

 

  

2

  

 

5. Care of Collateral; Performance.  The Company will: (a) keep in effect all licenses, permits and franchises required by law or contract relating to the Company’s business (if applicable), property, or the Collateral; maintain insurance on the Collateral; (b) keep the Collateral in good repair (other than ordinary wear and tear) and be responsible for any loss or damage to it; (c) at all times warrant and defend the Company’s ownership and possession of the Collateral; (d) keep the Collateral free from all Material Liens, claims, encumbrances and security interests (except liens created under this Agreement); (e) pay when due all taxes, license fees, and other charges upon the Collateral or upon the Company’s business, property or the income therefrom; (f) remain liable under any contracts, agreements and other documents relating to or affecting the Collateral to the extent set forth therein and perform all of its duties and obligations thereunder to the same extent as if this Agreement had not been executed; and (g) not misuse, conceal or in any way use or dispose of the Collateral unlawfully or contrary to the provisions of this Agreement or of any insurance coverage.  Loss of, damage to, or uncollectibility of the Collateral or any part thereof will not release the Company from the Obligations.  The exercise by any Secured Party or the Collateral Agent of any of the rights hereunder shall not release the Company from any of its duties or obligations under such contracts, agreements and other documents relating to or affecting the Collateral, and neither the Collateral Agent nor any Secured Party shall have any obligation or liability under any contracts, agreements and other documents relating to or affecting the Collateral by reason of this Agreement, nor shall the Collateral Agent or any Secured Party be obligated to perform any of the obligations or duties of the Company thereunder or to take any action to collect or enforce any such contract, agreement or other document relating to or affecting the Collateral.

 

6. Other Covenants.

 

(a) The Company shall give prompt written notice to the Collateral Agent of (and in any event not later than thirty (30) days after)  (i) any change in the location of the Company’s chief executive office or principal place of business; (ii) any change in its name; (iii) any changes in its identity or structure in any manner which might make any financing statement filed hereunder incorrect or misleading; (iv) any change in its registration as an organization (or any new such registration); or (v) any change in its jurisdiction of organization.

 

(b) Except as otherwise specifically permitted herein (including Section 6(c)), the Company will not surrender or lose possession of (other than to the Secured Parties or, with the prior consent of Collateral Agent, to a depositary or financial intermediary), transfer, assign or otherwise dispose of or transfer the Collateral or any right, title or interest therein.

 

  

3

  

 

(c) Prior to the occurrence of an Event of Default (as defined in the Notes), the Company will Company shall not transfer or otherwise dispose of all or any portion of the Collateral, or enter into any lease or license for the use of the Collateral, other than in the ordinary course of business and in all cases for fair and reasonable consideration.  After an Event of Default, any attempted sale or transfer of the Collateral not otherwise consented to by the Collateral Agent in writing shall be void and of no force or effect.

 

(d) The Company shall not, at any time, make or become obligated to make, directly or indirectly, any: (i) payment or distribution in respect of any capital stock or other equity interests in the Company; (ii) payment or distribution on account of the purchase, repurchase, redemption or other retirement of any capital stock or other interests in Company; (iii) loans, advances or payments to any affiliate or stockholder of the Company, including, without limitation, any officer or director of the Company; or (iv) investment in third parties other than in money market funds for purposes of cash management.

 

7. Default.  The occurrence and continuance of any Event of Default (as defined in the Notes) shall constitute an Event of Default hereunder.  Waiver of any default will not constitute a waiver of any other or subsequent default.

 

8. Remedies.

 

(a) Upon the occurrence and continuance of any Event of Default, at the option of any Secured Party without further notice or demand, declare the entire unpaid principal and accrued and unpaid interest of all of the outstanding Notes (including all Notes held by the other Secured Parties) shall, without presentment, demand, protest, or notice of any kind, all of which are hereby expressly waived, be forthwith due and payable.  Any Secured Party that exercises the remedy under this Section 7(a) shall provide prompt written notice thereof to the other Secured Parties.

 

(b) Upon the occurrence and continuance of any Event of Default, the Collateral Agent may, immediately and without expiration of any period of grace, enforce payment of all amounts due and owing under the Notes and exercise any and all other remedies granted to the Collateral Agent at law, in equity or otherwise, including without limitation all rights of the Collateral Agent under the UCC as in effect from time to time in the State of Utah and other jurisdictions.

 

9. Application of Proceeds of Collateral.  In the event of the repossession, sale, collection or other disposition of any of the Collateral pursuant to the terms of this Agreement, the proceeds thereof shall be applied as follows:

 

(a) First, to the satisfaction of any costs and expenses, including attorneys’ fees, incurred by the Collateral Agent in pursuing the enforcement action.

 

(b) Second, to the payment to each Secured Party on a pro-rata basis based upon the amount of the Obligations owed thereto (to be applied first to late charges, second to accrued interest and third to outstanding principal).

 

  

4

  

 

(c) Third, to the payment of the surplus, if any, to the Company, its successors and assigns, or to whomsoever may be lawfully entitled to receive the same.

 

10. Collateral Agent’s Appointment as Attorney-in-Fact.  The Company hereby irrevocably appoints Collateral Agent as its attorney-in-fact (which appointment is coupled with an interest), and the Company and each Secured Party agree that Collateral Agent may perform (but Collateral Agent shall not be obligated to and shall incur no liability to the Company, the Secured Parties or any third party for failure so to do) any act which the Company is obligated by this Security Agreement to perform and fails to perform, and to exercise such rights and powers as the Company might exercise with respect to the Collateral and fails to exercise, including the right to (a) collect by legal proceedings or otherwise and endorse, receive and receipt for all dividends, interest, payments, proceeds and other sums and property now or hereafter payable on or on account of the Collateral; (b) enter into any extension, reorganization, deposit, merger, consolidation or other agreement pertaining to, or deposit, surrender, accept, hold or apply other property in exchange for the Collateral; (c) make any compromise or settlement, and take any action it deems advisable, with respect to the Collateral; (d) insure, process and preserve the Collateral; (e) pay any indebtedness of the Company relating to the Collateral; and (f) execute and file UCC financing statements and other documents, instruments and agreements required hereunder; provided, however, that Collateral Agent shall not exercise any such powers granted pursuant to subsections (a) through (c) prior to the occurrence of an Event of Default and shall only exercise such powers during the continuance of an Event of Default.  The Company agrees to reimburse Collateral Agent upon demand for any reasonable costs and expenses, including attorneys’ fees, Collateral Agent may incur while acting as the Company’s attorney-in-fact hereunder, all of which costs and expenses are included in the Obligations.  It is further agreed and understood between the parties hereto that such care as Collateral Agent gives to the safekeeping of its own property of like kind shall constitute reasonable care of the Collateral when in Collateral Agent’s possession; provided, however, that Collateral Agent shall not be required to make any presentment, demand or protest, or give any notice and need not take any action to preserve any rights against any prior party or any other person in connection with the Obligations or with respect to the Collateral.

 

11. Agreements Among Secured Parties.

 

(a) Agreement to Cooperate and Pursue Remedies.

 

(i) Each Secured Party hereby agrees to cooperate fully with Collateral Agent and the other Secured Parties in order to promptly discharge the terms and provisions of this Agreement.  Each Secured Party also agrees, from time to time, to execute and deliver any and all other agreements, documents or instruments and to take such other actions, all as may be reasonably necessary or desirable to effectuate the terms, provisions and the intent of this Security Agreement.

 

(ii) Each Secured Party agrees that, until Obligations owed thereto have been paid in full, if an Event of Default has occurred and is continuing, it will diligently pursue, or cause Collateral Agent to diligently pursue, any and all collection actions and remedies available to such Secured Party or to the Collateral Agent under applicable law which actions and remedies such Secured Party deems reasonably likely to result in the recovery of amounts to be applied to Obligations for the benefit of the Secured Parties.

 

  

5

  

 

(b) Parity of Treatment.  Except to the extent permitted under the Notes, each Secured Party agrees that it will not accept from the Company or any other person any benefit or consideration (whether immediate or prospective, definite or contingent) with respect to the Obligations (including, without limitation, any guaranty from any third party or any collateral security) without the prior written consent of the other Secured Parties unless such benefit or consideration shall also be conferred upon or paid to such other Secured Party on a pro rata basis based upon the amount of Obligations owed thereto.

 

(c)           Authorization to Collect and Distribute Payments Under the Notes.  Each Secured Party hereby authorizes the Collateral Agent to collect from the Company all payments payable to the Secured Parties under the Notes and then to promptly, and in any event within five business days, disperse such payments to the applicable Secured Parties in accordance with the amounts payable to each of them under the applicable Note.

 

12. Collateral Agent.  Collateral Agent accepts the duties hereunder and agrees to perform the same, but only upon the terms and conditions hereof, including the following, to all of which the Company and the Secured Parties by their acceptance hereof agree:

 

(a) Actions of Collateral Agent.  As long as any Secured Party, including any Additional Purchaser which may become a Secured Party in accordance with this Agreement and the Purchase Agreement, holds any outstanding Notes, Collateral Agent shall not take any material actions in relation to this Agreement or the Notes, including without limitation any action under Sections 9(b) and (c) or any material action under Section 7 in respect to enforcing the payment under the Notes or the exercise of any other remedies under this Agreement, without the written consent of the Secured Parties representing a majority of the aggregate face value of the Notes then outstanding, including any Notes currently held by the Collateral Agent, which consent shall not be unreasonably withheld.

 

(b) Duties of Collateral Agent.

 

(i) Collateral Agent shall not have any duty or obligation to take or refrain from taking any action under, or in connection with, this Agreement, except as expressly provided by the terms and conditions of this Agreement, or expressly provided in written instructions received pursuant to the terms of this Agreement.

 

(ii) Collateral Agent may, but shall not be under any obligation to, take any action which is discretionary with Collateral Agent or otherwise requires judgment to be made by Collateral Agent under the provisions hereof, except if Collateral Agent is required to take such action on the written request of the Secured Parties, as provided herein.

 

(c) Collateral Agent’s Liability.  No provision of this Security Agreement shall be construed to relieve Collateral Agent from liability for its own grossly negligent action, grossly negligent failure to act, or its own willful misconduct.  Collateral Agent shall not be liable except for the performance of such duties as are specifically set forth in this Security Agreement and no implied covenants or obligations of Collateral Agent shall be read into this Security Agreement.  The duties and obligations of Collateral Agent shall be determined solely by the express provisions of this Security Agreement.

 

  

6

  

 

(d) Resignation of Collateral Agent.  Collateral Agent may resign as Collateral Agent upon not less than thirty (30) days’ written notice to each of the Secured Parties.  Upon any such resignation, the Secured Parties shall have the right to jointly appoint a successor Collateral Agent.  If no successor Collateral Agent shall have been so appointed, and shall have accepted such appointment in writing within 30 days after the retiring Collateral Agent’s giving of notice of resignation, then the retiring Collateral Agent may, on behalf of the Secured Parties, appoint a successor Collateral Agent, which shall be a commercial bank organized under the laws of the United States of America or of any state thereof with the legal capacity to act as Collateral Agent hereunder, and the Company agrees to pay such reasonable fees and expenses of any such commercial bank as shall be necessary to induce such commercial bank to agree to become a successor Collateral Agent hereunder.  Upon acceptance of appointment as Collateral Agent, such successor shall thereupon and forthwith succeed to and become vested with all the rights, powers and privileges, immunities and duties of the retiring Collateral Agent, and the retiring Collateral Agent, upon the signing, transferring and setting over to such successor Collateral Agent all rights, moneys and other collateral held by it in its capacity as Collateral Agent, shall be discharged from its duties and obligations hereunder.  After any retiring Collateral Agent’s resignation as Collateral Agent, the provisions of this Section 11, shall inure to its benefit as to any actions taken or omitted to be taken by it while it acted as Collateral Agent.

 

(e) Indemnification of Collateral Agent.

 

(i) the Company agrees to indemnify Collateral Agent for, and to hold it harmless against, any loss, liability or expense incurred without gross negligence or willful misconduct on its part, arising out of or in connection with the acceptance or administration of this Agreement, including, but not limited to, the costs and expenses of defending itself against any claim or liability in connection with the exercise or performance of any of its powers or duties hereunder, and any loss, liability, expense or claim arising out of its possession, management, control, use or operation of the Collateral.

 

(ii) Each Secured Party agrees to indemnify Collateral Agent on a pro rata basis based upon the amount of the Obligations owed thereto, for any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind and nature whatsoever that may be imposed on, incurred by or asserted against Collateral Agent arising out of the actions of Collateral Agent hereunder or the transactions contemplated thereby or the enforcement of any of the terms thereof or of any such other documents, provided that none of the Secured Parties (other than any Secured Party that also is Collateral Agent) shall be liable for any of the foregoing to the extent they arise from the gross negligence, willful misconduct or knowing violations of law by Collateral Agent.

 

  

7

  

 

(iii) Notwithstanding any other provision of this Agreement, Collateral Agent shall in all cases be fully justified in failing or refusing to act hereunder unless it shall be indemnified to its satisfaction by the Company and each Secured Party against any and all liability and expense that may be incurred by it by reason of taking or continuing to take any such action.

 

(f) Credit Analysis.  Each of the Secured Parties has made, and shall continue to make, its own independent investigation or evaluation of the operations, business, property and condition, financial and otherwise, of the Company in connection with entering into this Agreement and the Notes and has made its own appraisal of the creditworthiness of the Company.  Except as explicitly provided herein, Collateral Agent has no duty or responsibility, either initially or on a continuing basis, to provide any Secured Party with any credit or other information with respect to such operations, business, property, condition or creditworthiness, whether such information comes into its possession on or before the first Event of Default or at any time thereafter

 

13. Termination.  This Agreement shall terminate and the Collateral herein shall be released from the lien of the Secured Party at such time as the Obligation to all of the Secured Parties has been satisfied or terminated.

 

14. General.

 

(a) Notices.  All notices, communications and deliveries under this Agreement will be made in writing signed by or on behalf of the party making the same, will be delivered personally or by facsimile or other electronic transmission or sent by registered or certified mail (return receipt requested) or by next day courier (with evidence of delivery and postage and other fees prepaid) as follows:

 

To the Purchaser:

GWire Corporation

c/o ActiveCare, Inc.

5095 West 2100 South

Salt Lake City, UT 84120

801-974-9474 (Telephone)

801-974-9553 (Facsimile)

 

E-Mail: macton@activecare.com

 

with a copy to:

 

Durham Jones & Pinegar, PC

111 East Broadway, Suite 900

Salt Lake City, Utah 84111

Attn:   Kevin R. Pinegar

Facsimile: 801-415-3500

E-Mail: kpinegar@djplaw.com

 

  

8

  

 

To the Collateral Agent or the Secured Parties:

Green Wire, LLC

Rapid Medical Response, LLC

Orbit Medical Response, LLC

c/o BPE Management, LLC

Attn: Shawn Ross

4424 South 700 East, Suite 200

Salt Lake City, Utah 84107

Facsimile: 801-713-5347

E-mail: sross@tibromedical.com

 

with a copy (which shall not constitute notice) to:

Dorsey & Whitney LLP

136 So. Main Street, Suite 1000

Salt Lake City, Utah 84101

Attn:  Samuel P. Gardiner

Facsimile:  (801) 880-6941

Email:  gardiner.sam@dorsey.com

 

or to such other representative or at such other address of a party as such party may furnish to the other parties in writing.  Any notice which is delivered personally or by facsimile or other electronic transmission in the manner provided herein shall be deemed to have been duly given to the party to whom it is directed upon actual receipt by such party or its agent.  Any notice which is addressed and mailed in the manner herein provided shall be conclusively presumed to have been duly given to the party to which it is addressed at the close of business, local time of the recipient, on the fourth business day after the day it is so placed in the mail (or on the first business day after placed in the mail if sent by overnight courier) or, if earlier, the time of actual receipt.

 

(b) Assignment; Binding upon Successors and Assigns.  This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and assigns.  This Agreement is not assignable except by the Secured Parties to any of their affiliates and any other purported assignment shall be null and void.  Nothing contained in this Agreement shall be deemed to confer any right or benefit upon any person other than the parties hereto to the extent herein provided.

 

(c) Entire Agreement.  This Agreement, the Purchase Agreement, the Notes and the other documents and instruments contemplated by the Purchase Agreement set forth the entire agreement between the Company, the Collateral Agent and the Secured Parties with respect to all matters herein, and supersede all prior and contemporaneous security agreements, representations, and understandings of the parties.

 

  

9

  

 

(d) Amendment and Waivers. Any term of this Agreement may be amended and the observance of any term of this Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively), only with the written consent of the Company and the Secured Parties representing a majority of the aggregate face value of all of the Notes then outstanding; provided, however, that the written consent of any Secured Party that would be adversely affected by such amendment in a manner disproportionate to the other Secured Parties shall also be required.  The Company may, without the consent or vote of any Secured Party, amend this Agreement at any time to accept executed signature pages from Additional Purchasers pursuant to the Purchase Agreement, and such Additional Purchasers will thereafter become Secured Parties under this Agreement.

 

(e) Governing Law.  This Agreement will be governed by and construed and enforced in accordance with the internal laws of the State of Utah without reference to its choice of law rules.

 

(f) Jurisdiction.  Except as otherwise expressly provided in this Agreement, the parties hereto agree that any suit, action or proceeding seeking to enforce any provision of, or based on any matter arising out of or in connection with, this Agreement or the transactions contemplated hereby shall be brought only to the exclusive jurisdiction of the courts of the State of Utah or the federal courts located in the State of Utah, and each of the parties hereby consents to the jurisdiction of such courts (and of the appropriate appellate courts therefrom) in any such suit, action or proceeding and irrevocably waives, to the fullest extent permitted by law, any objection which it may now or hereafter have to the laying of the venue of any such suit, action or proceeding in any such court or that any such suit, action or proceeding which is brought in any such court has been brought in an inconvenient forum.  The parties agree that, after a legal dispute is before a court as specified in this Section 13(f), and during the pendency of such dispute before such court, all actions, suits, or proceedings with respect to such dispute or any other dispute, including without limitation, any counterclaim, cross-claim or interpleader, shall be subject to the exclusive jurisdiction of such court.  Process in any such suit, action or Proceeding may be served on any party anywhere in the world, whether within or without the jurisdiction of any such court.  Each party hereto agrees that a final judgment in any action, suit or proceeding described in this Section 13(f) after the expiration of any period permitted for appeal and subject to any stay during appeal shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by applicable laws.

 

(g) Waiver of Jury Trial.  EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

 

  

10

  

 

(h) Attorneys’ Fees.  In the event that any action or proceeding, including arbitration, is commenced by any party hereto for the purpose of enforcing any provision of this Agreement, the parties to such action, proceeding or arbitration may receive as part of any award, judgment, decision or other resolution of such action, proceeding or arbitration their costs and reasonable attorneys’ fees as determined by the person or body making such award, judgment, decision or resolution.  Should any claim hereunder be settled short of the commencement of any such action or proceeding, including arbitration, the parties in such settlement may include, as part of the damages alleged to have been incurred, reasonable costs of attorneys or other professionals in investigating or counseling on such claim.

 

(i) Severability of Provisions.  Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction will, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions of this Agreement, and any such prohibition or unenforceability in any jurisdiction will not invalidate or render unenforceable such provision in any other jurisdiction. To the extent permitted by law, the parties waive any provision of law which renders any such provision prohibited or unenforceable in any respect.

 

(j) Counterparts.  This Agreement may be executed in two (2) or more counterparts (delivery of which may be by facsimile or via email as a portable document format (.pdf)), each of which will be deemed an original, and it will not be necessary in making proof of this Agreement or the terms of this Agreement to produce or account for more than one (1) of such counterparts.

 

 

[Signature pages follow]

  

11

  

 

IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the day and year first above written.

 

SECURED PARTIES:

 

RAPID MEDICAL RESPONSE, LLC

 

 

BY: 

NAME: 

TITLE: 

 

 

 

GREEN WIRE, LLC

 

BY: 

 

NAME: 

TITLE: 

 

 

ORBIT MEDICAL RESPONSE, LLC

 

 

BY: 

 

NAME: 

TITLE: 

COMPANY:

 

GWIRE CORPORATION

 

 

BY: 

 

NAME: 

 

TITLE: 

 

 

 

 

12

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00225-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00225-of-00352.parquet"}]]