Document:

simh_ex1053.htm

EXHIBIT 10.53

 

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. IT MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THE SECURITIES UNDER SAID ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE CORPORATION THAT SUCH REGISTRATION IS NOT REQUIRED.

 

Sanomedics International Holdings, Inc.

 

PROMISSORY NOTE

 

	
Note No. 1.2.d

	
August 30, 2013

 

$500,000.00

 

FOR VALUE RECEIVED, Sanomedics International Holdings, Inc., a Delaware corporation ("Company"), and Anovent, Inc., a Florida corporation (“Buyer” and collectively with Company, “Maker”) jointly and severally promise to pay to Mark R. Miklos ("Holder"), or his registered assigns, the principal sum of up to $500,000.00, or such lesser amount as shall then equal the outstanding principal amount hereof, together with simple interest from the date of this Note on the unpaid principal balance at a rate equal to five percent (5%) per annum, computed on the basis of the actual number of days elapsed and a year of 365 days; provided; however; that notwithstanding anything contained to the contrary herein, the principal balance of this note shall be unilaterally reduced by the Company if: (i) the EBITDA (as defined and as determined by the Purchase Agreement (as defined below)) for the fiscal year ended December 31, 2013 (“2013 EBITDA”) is less than $975,000.00; and/or (ii) the EBITDA for the fiscal year ended December 31, 2014 (“2014 EBITDA”) is less than $975,000.00 (Therefore, by way of example, if 2013 EBITDA is $950,000.00; the principal balance of the Promissory Note B shall be reduced by $25,000.00 and the initial annual payment shall be reduced by the same amount). On the day following the first first anniversary of the date hereof and on the day following the second anniversary of the date hereof for a total of two (2) annual installments of principal and accrued interest, the Company shall pay to the Holder the amount of Two Hundred Sixty Eight Thousand Nine Hundred Two Dollars and 44/100 (US$ $268,902.44) less any reductions based upon EBITDA as set forth above. All unpaid principal, together with any then unpaid and accrued interest and other amounts payable hereunder, shall be due and immediately payable to the Holder on April 25, 2015 (the "Maturity Date"). At the Holder’s option, this Note can be paid in shares of common stock of the Company in lieu of cash at a price per share to be mutually agreed upon by the Company and Holder.

 

This Note is being issued pursuant to the terms of the Stock Purchase Agreement (the “Purchase Agreement”) by and among the Company, the Holder, Buyer, and Prime Time Medical, Inc., a Florida corporation wholly owned by the Holder (“PrimeTime”), dated the date hereof whereby the Holder sells, assigns and transfers all of the issued and outstanding equity of PrimeTime to Buyer. All capitalized terms not otherwise defined herein shall have the meaning ascribed to such terms in the Purchase Agreement.

 

The following is a statement of the rights of Holder and the conditions to which this Note is subject, and to which the Holder hereof, by the acceptance of this Note, agrees:

 

  

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1. Definitions. As used in this Note, the following capitalized terms have the following meanings:

 

(a) "Holder" shall mean the Person specified in the introductory paragraph of this Note or any Person who shall at the time is the registered holder of this Note.

 

(b) "Maker" includes the Company and Buyer, jointly and severally, and any Person which shall succeed to or assume the obligations of either Company or Buyer under this Note.

 

(c) "Person" shall mean and include an individual, a partnership, a corporation (including a business trust), a joint stock company, a limited liability company, an unincorporated association, a joint venture or other entity or a governmental authority.

 

(d) "Transaction Documents" shall mean the Purchase Agreement, the Short Term Promissory Note, Promissory Note A, Promissory Note B, and any other agreements or documents referenced in the Purchase Agreement, together with any exhibits thereto.

 

2. Payments. Permitted partial prepayments shall not affect or vary the duty of Maker to pay all obligations when due, and they shall not impair the right of Holder to pursue all remedies available to him hereunder. Each payment shall be applied first to the payment of accrued interest, if any, and second, to the payment of principal. Maker agrees to make payments required hereunder without setoff or counterclaim, and this Note shall not be subject to any such setoff or counterclaim. Absent manifest error, the records of Holder shall be conclusive as to amounts owed. All payments of principal of and interest on this Note shall be made by Maker to Holder in immediately available funds and lawful money of the United States of America, at Holder’s address set forth in the Purchase Agreement, or at such other place in the United States of America as Holder shall designate to Maker in writing, or by wire transfer to a United States of America account designated by Holder in writing. If any payment on this Note is due on a day that is not a Business Day (as defined below), such payment shall be due on the next succeeding Business Day. “Business Day” means any day other than a Saturday, Sunday or legal holiday of the State of Florida.

 

3. Reserved.

 

4. Events of Default. The occurrence of any of the following shall constitute an "Event of Default" under this Note:

 

(a) Maker shall fail to pay any payment of principal or interest on this Note on the date it becomes due and payable (whether by demand or by acceleration or otherwise);

 

(b) If any Event of Default shall exist under any note payable to Seller from Maker, including without limitation the Short Term Promissory Note, Promissory Note A, Promissory Note B;

 

(c) Maker shall breach any other provision of this Note, the Security Agreement, or any other Transaction Document and such breach remains uncured for ten days;

 

(d) Any representation or warranty of Maker made or deemed to be made hereunder or in any Transaction Document, or in any other writing or certificate furnished by or on behalf of Maker to Holder for the purposes of or in connection with this Note, is incorrect in any respect;

 

  

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(e) Maker shall surrender or lose possession of (other than to Holder), sell, encumber, lease, rent, option, or otherwise dispose of or transfer any portion of the Collateral (as defined in the Security Agreement) or any right or interest therein, or shall allow any lien or security interest to be incurred against any of the Collateral, in each case without the prior written consent of Holder;

 

(f) Any judgment or order for the payment of money shall be rendered against Maker;

 

(g) Maker shall become insolvent or generally fail to pay, or admit in writing its inability or unwillingness to pay, debts as they become due;

 

(h) Voluntary Bankruptcy or Insolvency Proceedings. Maker shall; (i) apply for or consent to the appointment of a receiver, trustee, liquidator or custodian of itself or of all or a substantial part of its property, (ii) make a general assignment for the benefit of its or any of its creditors, (iii) be dissolved or liquidated in full or in part, or (iv) commence a voluntary case or other proceeding seeking liquidation, reorganization or other relief with respect to itself or its debts under any bankruptcy, insolvency or other similar law now or hereafter in effect or consent to any such relief or to the appointment of or taking possession of its property by any official in an involuntary case or other proceeding commenced against it; or

 

(i) Involuntary Bankruptcy or Insolvency Proceedings. Proceedings for the appointment of a receiver, trustee, liquidator or custodian of Maker or of all or a substantial part of their property thereof, or an involuntary case or other proceedings seeking liquidation, reorganization or other relief with respect to Maker or the debts thereof under any bankruptcy, insolvency or other similar law now or hereafter in effect shall be commenced and an order for relief entered or such proceeding shall not be dismissed or discharged within sixty (60) days of commencement.

 

5. Rights of Holder upon Default. Upon the occurrence or existence of an Event of Default referred to in Paragraphs 3(a) through 3(g) and at any time thereafter during the continuance of such Event of Default, Holder may, by written notice to Maker, declare all outstanding obligations payable by Maker hereunder to be immediately due and payable without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived, anything contained herein or in the other Transaction Documents to the contrary notwithstanding. Upon the occurrence or existence of any Event of Default described in Paragraphs 3(h) and 3(i), immediately and without notice, all outstanding obligations payable by Maker hereunder shall automatically become immediately due and payable, without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived, anything contained herein to the contrary notwithstanding. Additionally, upon the occurrence or existence of an Event of Default, Holder may, at his option exercise any and all rights and remedies available to Holder under applicable law or pursuant to the Security Agreement, including, without limitation, the right to collect from Maker all sums due under this Note. Further, notwithstanding anything to the contrary, upon the occurrence of an Event of Default, the rate of interest on the unpaid principal shall be increased at Holder’s discretion, beginning with the date of the Event of Default, up to the lesser of 18% per annum or the maximum allowed by applicable law (the “Default Rate”). The provisions herein for a Default Rate shall not be deemed to extend the time for any payment hereunder or to constitute a “grace period” giving Maker a right to cure any default. At Holder’s option, any accrued and unpaid interest, fees or charges may, for purposes of computing and accruing interest on a daily basis after the due date of the Note or any installment thereof, be deemed to be a part of the principal balance, and interest shall accrue on a daily compounded basis after such date at the Default Rate provided in this Note until the entire outstanding balance of principal and interest is paid in full. The remedies of Holder shall be cumulative and concurrent, and may be pursued singularly, successively or together, at the sole discretion of Holder, and may be exercised as often as occasion therefor shall arise.

 

  

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6. Cost of Collection. Maker shall pay all costs of collection, including reasonable attorneys’ fees, on failure to pay any principal or interest when due on this Note. Reasonable attorneys’ fees are defined to include, but not be limited to, all fees and costs incurred in all matters of collection and enforcement, construction and interpretation, before, during and after suit, trial, proceedings and appeals, as well as appearances in and connected with any bankruptcy proceedings or creditors’ reorganization or similar proceedings, or which arise without filing suit.

 

7. Successors and Assigns. Subject to the restrictions on transfer described in Sections 7 and 8 below, the rights and obligations of Maker and Holder hereunder shall be binding upon and benefit the successors, assigns, heirs, administrators and transferees of the parties.

 

8. Waiver and Amendment. Any provision of this Note may be amended, waived or modified upon the written consent of Maker and Holder.

 

9. Transfer of this Note. With respect to any offer, sale or other disposition of this Note, Holder will give written notice to Maker prior thereto, describing briefly the manner thereof, together with a written opinion of Holder's counsel, to the effect that such offer, sale or other distribution may be effected without registration or qualification (under any federal or state law then in effect). Promptly upon receiving such written notice and reasonably satisfactory opinion, if so requested, Maker, as promptly as practicable, shall notify Holder that Holder may sell or otherwise dispose of this Note, all in accordance with the terms of the notice delivered to Maker. If a determination has been made pursuant to this Section 7 that the opinion of counsel for Holder is not reasonably satisfactory to Maker, Maker shall so notify the Holder promptly after such determination has been made. The Note thus transferred shall bear a legend as to the applicable restrictions on transferability in order to ensure compliance with the Securities Act of 1933, as amended (the "Act"), unless in the opinion of counsel for Maker such legend is not required in order to ensure compliance with the Act. Maker may issue stop transfer instructions to its transfer agent in connection with such restrictions. Prior to presentation of this Note for registration of transfer, Maker shall treat the registered holder hereof as the owner and holder of this Note for the purpose of receiving all payments of principal and interest hereon and for all other purposes whatsoever, whether or not this Note shall be overdue and Maker shall not be affected by notice to the contrary.

 

10. Assignment by Maker. Neither this Note nor any of the rights, interests or obligations hereunder may be assigned, by operation of law or otherwise, in whole or in part, by Maker without the prior written consent of Holder.

 

11. Notices. All notices and other communications required or permitted hereunder shall be in writing, shall be effective when given, and shall in any event be deemed to be given upon receipt or, if earlier, (a) five (5) days after deposit with the U.S. Postal Service or other applicable postal service, if delivered by first class mail, postage prepaid, (b) upon delivery, if delivered by hand, (c) one business day after the business day of deposit with Federal Express or similar overnight courier, freight prepaid or (d) one business day after the business day of a facsimile transmission, if delivered by facsimile transmission with copy by first class mail, postage prepaid, and shall be addressed (i) if to the Holder, at the Holder's address on the register maintained by the Maker, and (ii) if to the Maker, at the address of its principal corporate offices (Attn: David C. Langle, CFO), or at such other address as a party may designate by ten (10) days' advance written notice to the other party pursuant to the provisions above.

 

  

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12. Payment; Prepayment.

 

(a) Payment shall be made in lawful tender of the United States.

 

(b) The Maker shall have the right to prepay at any time, without penalty, in whole or in part, the unpaid principal and interest due on this Note.

 

13. Usury. In the event that any payment of principal or interest provided for herein is not paid by Maker when due (including the entire unpaid balance of this Note in the event such amount is made immediately due and payable pursuant to the terms hereof), then Maker shall pay interest on such amounts not paid when due at a rate per annum one percent (1%) higher than the rate otherwise applicable hereunder. In the event any interest is paid on this Note which is deemed to be in excess of the then legal maximum rate, then that portion of the interest payment representing an amount in excess of the then legal maximum rate shall be deemed a payment of principal and applied against the principal of this Note.

 

14. Governing Law. This Note and all actions arising out of or in connection with this Note shall be governed by and construed in accordance with the laws of the State of Florida, without regard to the conflicts of law provisions of the State of Florida or of any other state. Each of the parties hereto agrees that any legal suit, action or proceeding arising out of or relating to this Note shall be instituted exclusively in the courts of the State of Florida, Hillsborough County, or if it has or can acquire jurisdiction, in the United States District Court sitting in Tampa Florida. Each of the parties hereto further agrees to accept and acknowledge service of any and all process which may be served in any such suit, action or proceeding in the courts of the State of Florida, Hillsborough County and the United States District Court, and agree that service of process upon it mailed by certified mail to its address shall be deemed in every respect effective service of process upon it, in any such suit, action or proceeding.

 

15. Waiver. Maker waives protest, demand, presentment and notice of dishonor, notice of the maturity, nonpayment, and all requirements necessary to hold him liable as Maker. Failure by Holder, at any time, to exercise any of Holder’s options or rights hereunder or to accelerate the debt upon an Event of Default hereunder, shall not be construed as (i) a novation of this Note; (ii) a waiver of the right of Holder to thereafter insist upon strict compliance with the terms of this Note; or (iii) a bar to exercise any of Holder’s options or rights at a later date. No waiver of any default or Event of Default hereunder shall operate as a waiver of any other default or Event of Default hereunder. A waiver or release with reference to any one event shall not be construed as continuing, as a bar to, or as a waiver or release of any subsequent right, remedy or recourse as to a subsequent event. Time is of the essence with regard to this Note. No delay or omission on the part of Holder in exercising any right or remedy shall operate as a waiver thereof and no single or partial exercise by Holder of any right or remedy shall preclude any other or future exercise thereof or the exercise of any other right or remedy.

 

  

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16. Waiver of Jury Trial. MAKER AND HOLDER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT ANY OF THEM MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY HERETO. THIS PROVISION IS A MATERIAL INDUCEMENT FOR HOLDER ENTERING INTO THE TRANSACTION CONTEMPLATED BY THIS NOTE.

 

17. Final Agreement. THERE ARE NO ORAL AGREEMENTS BETWEEN MAKER AND HOLDER WITH REGARD TO THE SUBJECT MATTER OF THIS NOTE. This Note and the Security Agreement embodies the final and entire agreement of Maker and Holder, and supersedes any and all prior commitments, agreements, representations, and understandings, whether written or oral, relating to the subject matter hereof and may not be contradicted or varied by evidence of prior, contemporaneous, or subsequent oral agreements or discussions of Maker and Holder.

 

18. Signatures. It is agreed that this Note may be executed by facsimile or electronic (email) and that such signatures transmitted by facsimile or email shall be binding on the parties. It is further agreed that if electronic signatures are used, each party hereto agrees to manually execute this Note, or if manual signatures are transmitted by facsimile or email, then, upon execution of this Note, each party hereto agrees to return manually signed fully executed originals to the other party. Until such time as such manually signed originals are fully executed by the parties and delivered, or in the event such does not occur, the fully executed agreement transmitted with electronic signature or by facsimile or email, shall remain the binding agreement of the parties.

 

19. Documentary Stamps. Maker shall pay all necessary documentary stamp taxes due on the obligation evidenced by this Note.

 

 

[Remainder of this page intentionally left blank; signatures to follow.]

 

  

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IN WITNESS WHEREOF, Maker has caused this Note to be issued as of the date first written above.

 

	 	SANOMEDICS INTERNATIONAL HOLDINGS, INC.	 
	 	 	 	 
	 	By:	/s/ Keith Houlihan 	 
	 	 	
Keith Houlihan

President

	 
	 	 	 	 
	 	 	 	 
	 	Anovent, Inc.	 
	 	 	 	 
	 	By:	/s/ Keith Houlihan	 
	 	 	
Keith Houlihan

President

	 

 

 

 

7simh_ex1054.htm

EXHIBIT 10.54

 

SECURITY AGREEMENT

 

THIS SECURITY AGREEMENT (this “Agreement”) is made and entered into as of August 30, 2013, by and among Sanomedics International Holdings, Inc., a Delaware corporation ("Company"), and Anovent, Inc., a Florida corporation (“Buyer” and collectively with Company, “Maker”) jointly and severally promise to pay to Mark R. Miklos (the “Lender”).

 

1. Grant of Security Interest. To secure the full and punctual payment and performance of all Obligations (as hereafter defined), Maker hereby pledges, assigns, hypothecates, sets over and conveys to the Lender, and grants to Lender a continuing senior security interest in, all of its right, title and interest in and to all of its assets now owned or at any time hereafter acquired by Maker, or in which Maker now has or at any time in the future may acquire any right, title or interest  including without limitation the following: all cash, cash equivalents, accounts, accounts receivable, deposit accounts, inventory, equipment, goods, documents, instruments (including, without limitation, promissory notes), contract rights, general intangibles, chattel paper, supporting obligations, investment property, letter-of-credit rights, trademarks, trademark applications, tradestyles, patents, patent applications, copyrights, copyright applications and other intellectual property in which Maker now has or hereafter may acquire any right, title or interest, all proceeds and products thereof and all additions, accessions and substitutions thereto or therefore (the “Collateral”). The term “Obligations” as used herein shall mean and include all debts, liabilities and obligations owing by Maker to the Lender arising under, out of, or in connection with any and all of the Promissory Notes in the original principal amount of $500,000 in favor of the Lender dated as of the date hereof (the “Notes”).

 

2. Default.

 

(a) The occurrence of any of the Events of Default as defined in the Notes shall constitute an “Event of Default” under this Agreement. If any Event of Default has occurred and is continuing, the Lender may exercise, without further notice, all rights and remedies under this Agreement and the Notes or that are available to a secured creditor under the Uniform Commercial Code as in effect on the date hereof in the State of Florida (the “UCC”) or that are otherwise available at law or in equity, at any time, in any order and in any combination. In addition, the Lender may sell the Collateral or any part thereof at public or private sale, for cash, upon credit or for future delivery, and at such price or prices as the Lender may deem satisfactory. The Lender shall give Maker not less than five (5) days’ prior written notice of the time and place of any sale or other intended disposition of Company’s Collateral, except any Collateral which is perishable or threatens to decline speedily in value or is of a type customarily sold on a recognized market. The Company agrees that any such notice constitutes “reasonable notification” within the meaning of the UCC (to the extent applicable). The Lender may be the Lender of any or all of the Collateral so sold at any public sale (or, if the Collateral is of a type customarily sold in a recognized market or is of a type which is the subject of widely distributed standard price quotations or if otherwise permitted under applicable law, at any private sale) and thereafter hold the same, absolutely, free from any right or claim of whatsoever kind. The Company will execute and deliver such documents and take such other action as the Lender deems necessary or advisable in order that any such sale may be made in compliance with law. Upon any such sale the Lender shall have the right to deliver, assign and transfer to the purchaser thereof the Collateral so sold. Each purchaser at any such sale shall hold the Collateral so sold to it absolutely, free from any claim or right of any kind, including any equity or right of redemption of Maker. To the extent permitted by law, Maker hereby specifically waives all rights of redemption, stay or appraisal which it has or may have under any law now existing or hereafter adopted. The notice (if any) of such sale shall (1) in case of a public sale, state the time and place fixed for such sale, and (2) in the case of a private sale, state the day on which such sale may be consummated. Any such public sale shall be held at such time or times within ordinary business hours and at such place or places as the Lender may fix in the notice of such sale. At any such sale the Collateral may be sold in one lot as an entirety or in separate parcels, as the Lender may determine. The Lender shall not be obligated to make any such sale pursuant to any such notice. The Lender may, without notice or publication, adjourn any public or private sale or cause the same to be adjourned from time to time by announcement at the time and place fixed for the sale, and such sale may be made at any time or place to which the same may be so adjourned. In case of any sale of all or any part of the Collateral on credit or for future delivery, the Collateral so sold may be retained by the Lender until the selling price is paid by the purchaser thereof, but the Lender shall not incur any liability in case of the failure of such purchaser to take up and pay for the Collateral so sold and, in case of any such failure, such Collateral may again be sold upon like notice. The Lender, instead of exercising the power of sale herein conferred upon it, may proceed by a suit or suits at law or in equity to foreclose the security interests and sell the Collateral, or any portion thereof, under a judgment or decree of a court or courts of competent jurisdiction. The Company shall remain liable, jointly and severally, for any deficiency.

 

  

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(b) For the purpose of enforcing any and all rights and remedies under this Agreement, the Lender may (i) require Maker to, and Maker agrees that it will, at its expense and upon the request of the Lender, forthwith assemble all or any part of the Collateral as directed by the Lender and make it available at a place designated by the Lender which is, in the Lender’s opinion, reasonably convenient to the Lender and Maker, whether at the premises of a Company or otherwise, (ii) to the extent permitted by applicable law, enter, with or without process of law and without breach of the peace, any premises where any of the Collateral is or may be located and, without charge or liability to the Lender, seize and remove such Collateral from such premises, (iii) have access to and use Maker’s books and records, computers and software relating to the Collateral, (iv) prior to the disposition of the Collateral, store or transfer such Collateral without charge in or by means of any storage or transportation facility owned or leased by Maker, process, repair or recondition such Collateral or otherwise prepare it for disposition in any manner and to the extent the Lender deems appropriate and, in connection with such preparation and disposition, use without charge any trademark, trade name, copyright, patent or technical process or other intellectual property used by Maker, and Lender is hereby granted a license to use such intellectual property.

 

(c) Any proceeds of any disposition of any of the Collateral shall be applied by the Lender to the payment of all expenses in connection with the sale of the Collateral, including reasonable attorneys’ fees and other legal expenses and disbursements and the reasonable expense of retaking, holding, preparing for sale, selling, and the like, and any balance of such proceeds may be applied by the Lender toward the payment of the Obligations in such order of application as the Lender may elect, and Maker shall be liable for any deficiency.

 

3. Further Assurances; Covenants.

 

(a) The Company will not change the location of its chief executive office or principal place of business in any state unless it shall have given the Lender thirty (30) days prior written notice thereof and delivered a landlord, bailee or similar waiver with respect to such location as required by Lender, and complied with any other requirement in the Agreement or any other Related Agreement relating to the location of the Collateral.

 

(b) The Company will not change its name, taxpayer identification number, organizational number, identity, jurisdiction of organization or corporate structure in any manner unless it shall have given the Lender thirty (30) days prior written notice thereof, executed and delivered to the Lender all financing statements and financing statement amendments which the Lender may request in connection therewith.

 

(c) The Company will not merge or consolidate into, or transfer any of the Collateral to, any other Person other than another Company, without the prior written consent of the Lender.

 

(d) The Company hereby authorizes Lender, its counsel or its representative, at any time and from time to time, to file financing statements and amendments that describe the collateral covered by such financing statements as “all assets of Company”, “all personal property of Company” or words of similar effect, in such jurisdictions as Lender may deem necessary or desirable in order to perfect the security interests granted by Company under the Agreement. The Company will, from time to time, at its expense, execute, deliver, file and record any statement, assignment, instrument, document, agreement or other paper and take any other action (including, without limitation, any filings with the United States Patent and Trademark Office, or the United States Copyright Office, any other Copyright, Trademark or Patent filings and any filings of financing or continuation statements under the UCC) that from time to time may be necessary, or that the Lender may request, in order to create, preserve, upgrade in rank (to the extent required hereby), perfect, confirm or validate the Security Interests or to enable the Lender and the Lender to obtain the full benefits of the Agreement, or to enable the Lender to exercise and enforce any of its rights, powers and remedies hereunder with respect to any of the Collateral. To the extent permitted by law, Maker hereby authorizes the Lender to execute and file financing statements, financing statement amendments or continuation statements without Maker’s signature appearing thereon and on behalf of such Guarantor. Company agrees that a carbon, photographic, photostatic or other reproduction of the Agreement or of a financing statement is sufficient as a financing statement. The Company shall pay the costs of, or incidental to, any recording or filing of any financing statements, financing statement amendments or continuation statements concerning the Collateral.

 

  

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(e) The Company will not permit any of its tangible assets to be in the possession of any other Person, except to the extent that any tangible assets (for example, computer servers) are being managed by a third party as a part of the ordinary course of business of Maker

 

(f) The Company will not (A) sell, transfer, lease, exchange, assign or otherwise dispose of, or grant any option, warrant or other right with respect to, any Collateral except the sale of inventory in the ordinary course or the sale or disposal of obsolete equipment; or (B) create, incur or suffer to exist any Lien with respect to any Collateral, except for the Permitted Liens.

 

(g) The Company will, promptly upon request, provide to the Lender all information and evidence it may reasonably request concerning the Collateral, to enable the Lender to enforce the provisions of the Agreement.

 

(h) The Company will not file any amendment to or termination of a financing statement naming any Maker as debtor and Lender as secured party, or any correction statement with respect thereto, in any jurisdiction.

 

4. General Authority. The Company hereby irrevocably appoints (such appointment being coupled with an interest) the Lender its true and lawful attorney, with full power of substitution, in the name of Company, the Lender, or otherwise, for the sole use and benefit of the Lender, but at Company’s expense, to exercise, at any time from time to time all or any of the following powers:

 

(a) to file the financing statements, financing statement amendments and continuation statements referred to in Section 3;

 

(b) to demand, sue for, collect, receive and give acquittance for any and all monies due or to become due with respect to any Collateral or by virtue thereof, and to notify each obligor with respect thereto of the Lender’s interest in such Collateral;

 

(c) to settle, compromise, compound, prosecute or defend any action or proceeding with respect to any Collateral; and

 

(d) to sell, transfer, assign or otherwise deal in or with the Collateral or the proceeds or avails thereof, as fully and effectually as if the Lender were the absolute owner thereof.

 

  

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5. Limitation on Duty of Lender in Respect of Collateral

 

Beyond reasonable care in the custody thereof, the Lender shall have no duty as to any Collateral in its possession or control or in the possession or control of any bailee or any income thereon or as to the preservation of rights against prior parties or any other rights pertaining thereto. The Lender shall be deemed to have exercised reasonable care in the custody of the Collateral in its possession if the Collateral is accorded treatment substantially equal to that which it accords its own property, and the Lender shall not be liable or responsible for any loss or damage to any of the Collateral, or for any diminution in the value thereof, by reason of the act or omission of any warehouseman, carrier, forwarding agency, consignee or bailee selected by the Lender in good faith.

 

6. Subordination.  Notwithstanding anything contained herein to the contrary, the Obligations (which are the subject of this Security Agreement) and the security interest granted hereunder are subject and subordinate to all other indebtedness (the “Indebtedness”) of Maker, which is greater than $1,000,000 in the aggregate, now and in the future, and to all renewals, modifications, consolidations, replacements and extensions of any such Indebtedness.  Such subordination shall be self-operative and no further instrument of subordination shall be required by any lender or other creditor; however, upon reasonable request of the Maker, Lender agrees to execute and deliver an agreement or other documentation confirming such subordination. 

 

7. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Florida, without regard to principles of conflicts of laws. The parties agree to jurisdiction in the courts of Tampa, Florida. The prevailing party shall be entitled to recover from the other party its reasonable attorney’s fees and costs. In the event that any provision of this Agreement is invalid or unenforceable under any applicable statute or rule of law, then such provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform with such statute or rule of law. Any such provision which may prove invalid or unenforceable under any law shall not affect the validity or unenforceability of any other provision of this Agreement. Nothing contained herein shall be deemed or operate to preclude the Lender from bringing suit or taking other legal action against Maker in any other jurisdiction to collect on Maker’s obligations to the Lender, to realize on any collateral or any other security for such obligations, or to enforce a judgment or other court order in favor of the Lender.

 

8. JURISDICTION. THE BORROWER HEREBY CONSENTS TO THE JURISDICTION OF ANY STATE COURT LOCATED WITHIN HILLSBOROUGH COUNTY, STATE OF FLORIDA OR OF THE UNITED STATES SITTING IN TAMPA FLORIDA AND IRREVOCABLY AGREES THAT, SUBJECT TO AGENT’S ELECTION, ALL ACTIONS OR PROCEEDINGS ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS SHALL BE LITIGATED IN SUCH COURTS. THE BORROWER EXPRESSLY SUBMITS AND CONSENT TO THE JURISDICTION OF THE AFORESAID COURTS AND WAIVES ANY DEFENSE OF FORUM NON CONVENIENS. THE BORROWER HEREBY WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS AND AGREES THAT ALL SUCH SERVICE OF PROCESS MAY BE MADE UPON THE BORROWER BY CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT REQUESTED, ADDRESSED TO THE BORROWER REPRESENTATIVE, AT THE ADDRESS SET FORTH IN THIS AGREEMENT AND SERVICE SO MADE SHALL BE COMPLETE TEN (10) DAYS AFTER THE SAME HAS BEEN POSTED.

 

  

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9. WAIVER OF JURY TRIAL. THE BORROWER AND HOLDER HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS. THE BORROWER AND HOLDER ACKNOWLEDGE THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS RELIED ON THE WAIVER IN ENTERING INTO THIS AGREEMENT AND THE OTHER RELATED DOCUMENTS AND THAT EACH WILL CONTINUE TO RELY ON THE WAIVER IN THEIR RELATED FUTURE DEALINGS. THE BORROWER AND HOLDER WARRANT AND REPRESENT THAT EACH HAS HAD THE OPPORTUNITY OF REVIEWING THIS JURY WAIVER WITH LEGAL COUNSEL, AND THAT EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS.

 

10. Notices. Any notice herein required or permitted to be given shall be in writing and shall be deemed effectively given: (a) upon personal delivery to the party notified, (b) when sent by confirmed telex or facsimile if sent during normal business hours of the recipient, if not, then on the next business day, (c) five (5) days after having been sent by registered or certified mail, return receipt requested, postage prepaid, or (d) one day after deposit with a nationally recognized overnight courier, specifying next day delivery, with written verification of receipt. All communications shall be sent to Maker at the address provided in the Purchase Agreement executed in connection herewith, and to the Lender at the address provided in the Purchase Agreement for such Lender, or at such other address as Maker or the Lender may designate by ten (10) days advance written notice to the other parties hereto.

 

11. Failure or Indulgence Not Waiver. No failure or delay on the part of the Lender hereof in the exercise of any power, right or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude other or further exercise thereof or of any other right, power or privilege. The failure of Maker or the Lender to insist upon strict adherence to any term of the Agreement 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 Agreement..

 

12. Entire Agreement. This Agreement, the Transaction Documents (as defined in the Notes), and the exhibits and schedules hereto and thereto and the other documents delivered pursuant hereto constitute the full and entire understanding and agreement between the parties with regard to the subjects hereof and thereof and no party shall be liable or bound to any other in any manner by any representations, warranties, covenants and agreements except as specifically set forth herein and therein.

 

  

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13. Amendment and Waiver.

 

(a) This Agreement may be amended or modified only upon the written consent of Maker and the Lender.

 

(b) The obligations of Maker and the rights of the Lender under this Agreement may be waived only with the written consent of the Lender.

 

(c) The obligations of the Lender and the rights of Maker under this Agreement may be waived only with the written consent of Maker.

 

14. Delays or Omissions. It is agreed that no delay or omission to exercise any right, power or remedy accruing to any party, upon any breach, default or noncompliance by another party under this Agreement, the Purchase Agreement or the Related Agreements, shall impair any such right, power or remedy, nor shall it be construed to be a waiver of any such breach, default or noncompliance, or any acquiescence therein, or of or in any similar breach, default or noncompliance thereafter occurring. All remedies, either under this Agreement, the Purchase Agreement or the Related Agreements, by law or otherwise afforded to any party, shall be cumulative and not alternative.

 

15. Facsimile Signatures; Counterparts. This Agreement may be executed by facsimile signatures and in any number of counterparts, each of which shall be an original, but all of which together shall constitute one instrument.

 

  

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date set forth in the first paragraph hereof.

 

 

	 	SANOMEDICS INTERNATIONAL HOLDINGS, INC.	 
	 	 	 	 
	 	
By: 

	/s/ Keith Houlihan     	 
	 	 	Keith Houlihan	 
	 	 	President	 
	 	 	 	 

 

	 	
Anovent, Inc.

	 
	 	 	 	 
	 	
By: 

	/s/ Keith Houlihan     	 
	 	 	Keith Houlihan	 
	 	 	President	 
	 	 	 	 

                                                      

	 	Holder	 
	 	 	 	 
	 	
By:

	/s/ Mark R. Miklos 	 
	 	 	
Mark R. Miklos

	 

 

 

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