Document:

Exhibit 10.5

 

GUARANTY

(Continuing
Debt-Unlimited)

 

 

DATE. The date of this Guaranty is June 30,
2004.

 

LENDER:

 

TEXAS STATE BANK

3900
North 10th Street

McAllen,
Texas 78501-1719

Telephone:  (956) 631-5401

 

BORROWER:

 

THE WORNICK COMPANY, a Delaware corporation

10825
Kenwood Road

Cincinnati,
Ohio 45242

 

GUARANTOR:

 

RIGHT AWAY MANAGEMENT CORPORATION, a Delaware corporation

c/o
Veritas Capital Management II L.L.C.

Attention:
Robert B. McKeon

660
Madison Avenue

New
York, New York, 10021

 

THE WORNICK COMPANY RIGHT AWAY DIVISION, a Delaware corporation

c/o
Veritas Capital Management II L.L.C.

Attention:
Robert B. McKeon

660
Madison Avenue

New
York, New York, 10021

 

THE WORNICK COMPANY RIGHT AWAY DIVISION, L.P., a Delaware limited
partnership

200
North 1st Street

McAllen,
Texas 78501

 

1.  DEFINITIONS. 
As used in
this Guaranty, the terms have the following meanings:

 

A. Pronouns.  The pronouns “I”, “me” and “my” refer to all
persons or entities signing this Guaranty, individually and together with their
heirs, successors and assigns.  “You” and
“your” refer to the Lender, with its participants or syndicator, successors and
assigns, or any person or company that acquires an interest in the Debt.

 

 

B. Note.  “Note” refers to any promissory note
instrument that evidences the Borrower’s indebtedness, and any extensions,
renewals, modifications and substitutions of such promissory notes.

 

C. Debt.  “Debt” refers to debts, liabilities, and
obligations of the Borrower (including, but not limited to, amounts agreed to
be paid under the terms of any notes or agreements securing the payment of any
debt, loan, liability or obligation, overdrafts, letters of credit, guaranties,
advances for taxes, insurance, repairs and storage, and all extensions,
renewals, refinancings and modifications of these debts) whether now existing
or created or incurred in the future, due or to become due, or absolute or
contingent, including obligations and duties arising from the terms of all
documents prepared or submitted for the transaction such as applications,
security agreements, disclosures, the Note, this Guaranty, the Loan Agreement,
or any of the other Loan Documents.

 

D. Property.  “Property” means any property, real, personal
or intangible, that secures performance of the obligations of the Note, Debt,
or this Guaranty.

 

Capitalized
terms not otherwise defined in this Guaranty have the meaning assigned to such
terms in the Loan Agreement of even date herewith executed by Lender, Borrower,
Guarantor, and TWC Holding, LLC.

 

2.  AGREEMENT TO GUARANTY.  For good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, and to induce you, at your option, to make loans
or engage in any other transactions with the Borrower from time to time, I
absolutely and unconditionally promise to pay and guaranty the full and prompt
payment of all Debt of every type, purpose and description that the Borrower
may now or at any time in the future owe you (whether at maturity or upon
acceleration), including without limitation, all principal, accrued interest,
attorneys’ fees and collection costs, when allowed by law, that may become due
from the Borrower to you in collecting the Debt and in enforcing this Guaranty
and all other agreements with respect to the Borrower, including the Loan
Agreement; provided, however, that anything herein or in any
other Loan Document to the contrary notwithstanding, the maximum liability
hereunder and under the other Loan Documents of Guarantor shall in no event
exceed an amount equal to the largest amount that would not render Guarantor’s
obligations hereunder subject to avoidance under Section 548 of the
Federal Bankruptcy Code.

 

3.  EXTENSIONS. 
I consent to
all renewals, extensions, modifications and substitutions of the Debt which may
be made by you upon such terms and conditions as you may see fit from time to
time without further notice to me and without limitation as to the number of
renewals, extensions, modifications or substitutions.

 

4.  PRIMARY LIABILITY.  I am primarily liable under this Guaranty, regardless of whether or not
you pursue any of your remedies against the Borrower, against any other maker,
surety, guarantor or endorser of the Debt or against any Property. You may sue
me alone, or anyone else who is obligated on this Guaranty, or any number of us
together, to collect the Debt. My liability is not

 

2

 

conditioned
on the signing of this Guaranty by any other person and further is not subject
to any condition not expressly set forth in this Guaranty or any instrument
executed in connection with the Debt. My obligation to pay according to the
term of this Guaranty shall not be affected by the illegality, invalidity or
unenforceability or any notes or agreements evidencing the Debt, the violation
of any applicable usury laws, forgery, or any other circumstances which make
the indebtedness unenforceable against the Borrower. I will remain obligated to
pay on this Guaranty even if any other person who is obligated to pay the Debt,
including the Borrower, has such obligation discharged in bankruptcy,
foreclosure, or otherwise discharged by law.

 

5.  BANKRUPTCY. 
If a
bankruptcy petition should at any time be filed by or against the Borrower, the
maturity of the Debt, so far as my liability is concerned, shall be accelerated
and the Debt shall be immediately payable by me. I acknowledge and agree that
this Guaranty, and the Debt secured hereby, will remain in full force and
effect at all times, notwithstanding any action or undertakings by, or against,
you or against any Property, in connection with any obligation in any
proceeding in the United States Bankruptcy Courts. Such action or undertaking
includes, without limitation, valuation of Property, election of remedies or
imposition of secured or unsecured claim status upon claims by you pursuant to
the United States Bankruptcy Code, as amended. In the event that any payment of
principal or interest received and paid by any other guarantor, borrower,
surety, endorser or co-maker is deemed, by final order of a court of competent
jurisdiction, to have been a voidable preference under the bankruptcy or
insolvency laws of the United States or otherwise, then my obligation will
remain as an obligation to you and will not be considered as having been
extinguished.

 

6.  REVOCATION. 
I agree that
this is an absolute and unconditional Guaranty. I agree that this Guaranty will
remain binding on me, whether or not there are any debts outstanding, until you
have actually received written notice of my revocation of this Guaranty.  Notice of revocation will not affect my
obligation under this Guaranty with respect to any Debt incurred by or for
which you have made a commitment to Borrower before you actually receive such
notice, and all renewals, extensions, refinancing, and modifications of such
Debt.  I agree that if any other person
signing this Guaranty provides a notice of revocation to you, I will still be
obligated under this Guaranty until I provide such a notice of revocation to
you.

 

7.   PROPERTY. 
I agree that
any Property may be assigned, exchanged, released in whole or in part or
substituted without notice to me and without defeating, discharging or
diminishing my liability. My obligation is absolute and your failure to perfect
any security interest or any act or omission by you which impairs the Property
will not relieve me or my liability under this Guaranty. You are under no duty
to preserve or protect any Property until you are in actual or constructive
possession. For purpose of this paragraph, you will only be in “actual”
possession when you have physical, immediate and exclusive control over the
Property and have accepted such control in writing. Further, you will only be
deemed to be in “constructive” possession when you have both the power and
intent to exercise control over the Property.

 

8.  DEFAULT. 
I will be in
default if any of the following occur:

 

3

 

A.  Payments.  I fail to make a payment in full when due.

B.  Insolvency.  I make an assignment for the benefit of creditors or become insolvent,
either because my liabilities exceed my assets or I am unable to pay my debts
as they become due.

C. Failure to Perform.  I fail to perform any condition
or to keep any promise or covenant of this Guaranty.

D.  Other Documents.  A default occurs under the terms of any other transaction document,
including an Event of Default under the Loan Agreement or any other Loan
Documents.

E.  Other Agreements.  I am in default on any other debt or agreement I have with you.

F. Misrepresentation.  I make any verbal or written statement or
provide any financial information that is untrue, inaccurate, or conceals a
material fact at the time it is made or provided.

G.  Judgment.  I fail to satisfy or appeal any judgment against me.

H.   Forfeiture.  The Property is used in a manner or for a purpose that threatens
confiscation by legal authority.

I.  Name Change.  I change my name or assume an additional name without notifying you
before making such a change.

J.  Property Transfer.  I transfer all or a substantial part of my money or property.

K.  Property Value.  The value of the Property declines or is impaired in any material
respect.

L.  Insecurity.  You reasonably believe you are insecure.

 

9.  WAIVERS AND CONSENT.  To the
extent not prohibited by law, I waive protest, presentment for payment, demand,
notice of acceleration, notice of intent to accelerate and notice of dishonor.

 

A.  Additional Waivers.  In
addition, to the extent permitted by law, I consent to certain actions you may
take, and generally waive defenses that may be available based on these actions
or based on the status of a party to the Debt or this Guaranty.

 

(1)
You may renew or extend payment on the Debt, regardless of the number of such
renewals or extensions.

(2)
You may release any borrower, endorser, guarantor, surety, accommodation maker
or any other co-signer.

(3)
You may release, substitute or impair any Property securing the Debt.

(4)
You, or any institution participating in the Debt, may invoke your rights of
set-off.

(5)
You may enter into any sales, repurchases or participations of the Debt to any
person in any amounts and I waive notice of such sales, repurchases or
participations.

(6)
I agree that Borrower is authorized to modify the terms of the Debt or any
instrument securing, guarantying or relating to the Debt.

(7)
You may undertake a valuation of any Property in connection with any
proceedings under the United States Bankruptcy Code concerning Borrower or me,
regardless of any such valuation, or actual amounts received by you arising
from the sale of such Property.

 

4

 

(8)
I agree to consent to any waiver granted the Borrower, and agree that any delay
or lack of diligence in the enforcement of the Debt, or any failure to file a
claim or otherwise protect any of the Debt, in no way affects or impairs my
liability.

(9)
I agree to waive reliance on any anti-deficiency statutes, through subrogation
or otherwise, and such statutes in no way affect or impair my liability. In
addition, I waive any right of subrogation, contribution, reimbursement,
indemnification, exoneration, and any other right I may have to enforce any
remedy which you now have or in the future may have against Borrower or another
guarantor or as to any Property.

 

Any
Guarantor who is an “insider,” as contemplated by the United States Bankruptcy
Code, 11 U.S.C. 101, as amended, makes these waivers permanently. (An insider
includes, among others, a director, officer, partner, or other person in
control or a close relative of any of these other persons.) Any Guarantor who
is not an insider makes these waivers until all Debt is fully repaid.

 

B.  No Waiver By Lender.  Your
course of dealing, or your forbearance from, or delay in, the exercise of any
of your rights, remedies, privileges or right to insist upon my strict
performance of any provisions contained in the Debt instruments, shall not be
construed as a waiver by you, unless any such waiver is in writing and is signed
by you.

 

C.  Waiver of Claims.  I
waive all claims for loss or damage caused by your acts or omissions where you
acted reasonably and in good faith.

 

10.  REMEDIES.  After
the Borrower or I default, and after you give any legally required notice and
opportunity to cure the default specified in any of the Loan Documents, you may
at your option do any one or more of the following.

 

A. Acceleration.  You may make all or any part of the amount
owing by the terms of the Guaranty immediately due.

B.  Sources.  You may use any and all remedies you have under state or federal law or
in any instrument securing the Debt.

C.  Insurance Benefits.  You may make a claim for any and all insurance benefits or refunds that
may be available on default.

D.  Payment Made on the
Borrower’s Behalf.  Amounts advanced on the Borrower’s behalf
will be immediately due and may be added to the balance owing under the Debt.

E.  Set-Off.  You may use the right of set-off. This means you may set-off any amount
due and payable under the terms of this Guaranty against any right I have to
receive money from you.

 

My
right to receive money from you includes any deposit or share account balance I
have with you; any money owed to me on an item presented to you or in your
possession for collection or exchange; and any repurchase agreement or other
non-deposit obligation. “Any

 

5

 

amount
due and payable under the terms of this Guaranty” means the total amount to
which you are entitled to demand payment under the terms of this Guaranty at
the time you set-off.

 

Subject
to any other written contract, if my right to receive money from you is also
owned by someone who has not agreed to pay the Debt, your right of set-off will
apply to my interest in the obligation and to any other amounts I could
withdraw on my sole request or endorsement.

 

Your
right of set-off does not apply to an account or other obligation where my
right arises only in a representative capacity. It also does not apply to any
Individual Retirement Account or other tax-deferred retirement account.

 

You
will not be liable for the dishonor of any check when the dishonor occurs
because you set-off against any of my accounts. I agree to hold you harmless
from any such claims arising as a result of your exercise of your right of
set-off.

 

F.  Waiver.  Except as otherwise required by law, by choosing any one or more of
these remedies you do not give up your right to use any other remedy. You do
not waive a default if you choose not to use a remedy. By electing not to use
any remedy, you do not waive your right to later consider the event a default
and to use any remedies if the default continues or occurs again.

 

11.  COLLECTION EXPENSES AND ATTORNEYS’ FEES.  To the
extent permitted by law, I agree to pay all expenses of collection, enforcement
or protection of your rights and remedies under this Guaranty or any instrument
executed in connection with the creation of any Debt guarantied by this
Guaranty. All fees and expenses will be secured by the Property I have granted
you, if any. To the extent permitted by the United States Bankruptcy Code, I
agree to pay the reasonable attorney’s fees you incur to collect the Debt
guarantied by this Guaranty as awarded by any court exercising jurisdiction under
the Bankruptcy Code.

 

12.  WARRANTIES AND REPRESENTATIONS.  I have the right and authority to enter into this Guaranty. The
execution and delivery of this Guaranty will not violate any agreement
governing me or to which I am a party. 
In addition, I represent and warrant that this Guaranty was entered into
at the request of the Borrower, and that I am satisfied regarding the
Borrower’s financial condition and existing indebtedness, authority to borrow
and the use and intended use of all Debt proceeds.  I further represent and warrant that I have
not relied on any representations or omissions from you or any information
provided by you respecting the Borrower, the Borrower’s financial condition and
existing indebtedness, the Borrower’s authority to borrow or the Borrower’s use
and intended use of all Debt proceeds.

 

13.  RELIANCE. 
I acknowledge
that you are relying on this Guaranty in extending credit to the Borrower, and
I have signed this Guaranty to induce you to extend such credit. I represent
and warrant to you that I expect to derive substantial benefits from any loans
and financial accommodations resulting in the creation of the Debt guarantied
hereby. I agree to rely exclusively 

 

6

 

on
the right to revoke this Guaranty prospectively as to future transactions in
the manner as previously described in this Guaranty if at any time, in my
opinion, the benefit then being received by me in connection with this Guaranty
are not sufficient to warrant the continuance of this Guaranty. You may rely
conclusively on a continuing warranty that I continue to be benefited by this
Guaranty and you will have no duty to inquire into or confirm the receipt of
any such benefits, and this Guaranty will be effective and enforceable by you
without regard to the receipt, nature or value of any such benefits.

 

14.  APPLICABLE LAW.  This Guaranty is governed by the laws of Texas, the United States of
America and to the extent required, by the laws of the jurisdiction where the
Property is located.  Any disputes with
regard to this Guaranty shall be resolved by binding arbitration in accordance
with the arbitration provisions in the Loan Agreement.

 

15.  AMENDMENT, INTEGRATION AND SEVERABILITY.  This Guaranty may not be amended or modified by oral agreement. No
amendment or modification of this Guaranty is effective unless made in writing
and executed by you and me. This Guaranty is the complete and final expression
of the agreement. If any provision of this Guaranty is unenforceable, then the
unenforceable provision will be severed and the remaining provisions will still
be enforceable.

 

16.  INTERPRETATION.  Whenever used, the singular includes the plural and the plural includes
the singular. The section headings are for convenience only and are not to
be used to interpret or define the terms of this Guaranty.

 

17.  NOTICE, FINANCIAL REPORTS AND ADDITIONAL
DOCUMENTS.  Unless otherwise required by law, any notice
will be given by delivering it or mailing it by first class mail to the appropriate
party’s address listed herein, or to any other address designated in
writing.  I will inform you in writing of
any change in my name, address or other application information. I will provide
you any financial statement or information you request. All financial
statements and information I give you will be correct and complete.  I agree to sign, deliver, and file any
additional documents or certifications that you may consider necessary to
perfect, continue, and preserve my obligations under this Guaranty and to
confirm your lien status on any Property. Time is of the essence.

 

18.  CREDIT INFORMATION.  I agree that from time to time you may obtain credit information about
me from others, including other lenders and credit reporting agencies, and report
to others (such as a credit reporting agency) your credit experience with me. I
agree that you will not be liable for any claim arising from the use of
information provided to you by others or for providing such information to
others.

 

19.   SIGNATURES.  By
signing, I agree to the terms contained in this Guaranty, the Loan Agreement
and the other Loan Documents.  I also
acknowledge receipt of a copy of this Guaranty.

 

THIS WRITTEN LOAN DOCUMENTS REPRESENT THE FINAL
AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.

 

7

 

THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE
PARTIES.

 

[SIGNATURE PAGE FOLLOWS]

 

8

 

	
   

  	
  GUARANTOR:

  
	
   

  	
   

  
	
   

  	
  RIGHT
  AWAY MANAGEMENT

  CORPORATION, a
  Delaware corporation

  
	
   

  	
   

  
	
   

  	
   

  	
  /s/
  Robert B. McKeon

  	
   

  
	
   

  	
  By:

  	
  Robert
  B. McKeon

  
	
   

  	
  Its:

  	
  Chairman
  of the Board

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  THE
  WORNICK COMPANY RIGHT

  AWAY DIVISION, L.P., a
  Delaware limited

  partnership

  
	
   

  	
   

  
	
   

  	
  By:

  	
  Right
  Away Management

  Corporation, a Delaware corporation,

  General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  /s/
  Robert B. McKeon

  	
   

  
	
   

  	
   

  	
  By:

  	
  Robert
  B. McKeon

  
	
   

  	
   

  	
  Its:

  	
  Chairman
  of the Board

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  THE
  WORNICK COMPANY RIGHT

  AWAY DIVISION, a
  Delaware corporation

  
	
   

  	
   

  
	
   

  	
   

  	
  /s/
  Robert B. McKeon

  	
   

  
	
   

  	
  By:

  	
  Robert
  B. McKeon

  
	
   

  	
  Its:

  	
  Chairman
  of the Board

  
					

 

9Exhibit 10.6

 

SECURITY AGREEMENT

 

THIS
SECURITY AGREEMENT, dated as of June 30, 2004, is made and entered into by
and between: THE WORNICK COMPANY, a Delaware corporation, RIGHT AWAY MANAGEMENT
CORPORATION, a Delaware corporation, THE WORNICK COMPANY RIGHT AWAY DIVISION, a
Delaware corporation, and THE WORNICK COMPANY RIGHT AWAY DIVISION, L.P., a
Delaware limited partnership (collectively, the “Debtor”); and TEXAS STATE
BANK, a Texas banking corporation (the “Secured Party”).

 

WHEREAS,
Debtor and TWC Holding, LLC, a Delaware limited liability company, have entered
into a Loan Agreement with the Secured Party dated as of even date herewith (as
amended and in effect from time to time, the “Loan Agreement”); and

 

WHEREAS,
the Secured Party, subject to the terms and conditions contained in the Loan
Agreement, has agreed to make loans to THE WORNICK COMPANY, a Delaware
corporation (the “Obligor”), as further described in the Loan
Agreement(collectively, the “Loan”); and

 

WHEREAS,
it is a condition precedent to the Secured Party’s making the Loan to the
Obligor that the Debtor execute and deliver to the Secured Party a security
agreement in substantially the form hereof; and

 

WHEREAS,
the Debtor wishes to grant a security interest in favor of the Secured Party as
herein provided to secure all Obligations (as defined in the Loan Agreement) to
Secured Party.

 

NOW,
THEREFORE, in consideration of the promises contained herein and for other good
and valuable consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto agree as follows:

 

1.                                       Definitions. All capitalized terms used
herein without definitions shall have the respective meanings provided therefor
in the Loan Agreement. The term “State,” as used herein, means the State of
Texas. All terms defined in the Uniform Commercial Code of the State and used
herein not otherwise defined in the Loan Agreement or this Security Agreement
shall have the same definitions herein as specified therein.

 

2.                                       Grant of Security Interest. The Debtor hereby
grants to the Secured Party, to secure the payment and performance in full of
all the Obligations, a security interest in and so pledges and assigns to the
Secured Party, all assets and rights of the Debtor, wherever located, whether
now owned or hereafter acquired or arising, and all proceeds and products
thereof, including Cash, Deposit Accounts, Accounts Receivable, Contracts,
Inventory, Equipment, Fixed Assets, Parts Inventory, instruments, documents,
chattel paper (whether tangible or electronic), letter-of-credit rights
(whether or not the letter of credit is evidenced by a writing), commercial
tort claims, securities and all other investment property, supporting
obligations, Fixtures, Intangibles, leasehold interest in the Property, and
insurance claims and proceeds, and the Ownership Interests held by Debtor, all
of the foregoing hereinafter called the “Collateral.”  The Secured Party acknowledges that 

 

 

the
attachment of its security interest in any additional commercial tort claim as
original collateral is subject to the Debtor’s compliance with
Section 4.7.

 

3.                                       Authorization to File Financing Statements.
The Debtor hereby irrevocably authorizes the Secured Party at any time and from
time to time to file in any filing office in any Uniform Commercial Code
jurisdiction any initial financing statements and amendments thereto that (a)
indicate the Collateral (i) as all assets of the Debtor or words of similar
effect, regardless of whether any particular asset comprised in the Collateral
falls within the scope of Article 9 of the Uniform Commercial Code of the
State or such jurisdiction, or (ii) as being of an equal or lesser scope or
with greater detail, and (b) provide any other information required by part 5
of Article 9 of the Uniform Commercial Code of the State, or such other
jurisdiction, for the sufficiency or filing office acceptance of any financing
statement or amendment, including (i) whether the Debtor is an organization,
the type of organization and any organizational identification number issued to
the Debtor and, (ii) in the case of a financing statement filed as a fixture
filing or indicating Collateral as as-extracted collateral or timber to be cut,
a sufficient description of real property to which the Collateral relates. The
Debtor agrees to furnish any such information to the Secured Party promptly
upon the Secured Party’s request. The Debtor also ratifies its authorization
for the Secured Party to have filed in any Uniform Commercial Code jurisdiction
any like initial financing statements or amendments thereto if filed prior to
the date hereof.

 

4.                                       Other Actions. To further the attachment,
perfection and first priority of, and the ability of the Secured Party to
enforce, the Secured Party’s security interest in the Collateral, and without
limitation on the Debtor’s other obligations in this Agreement, the Debtor
agrees, in each case at the Debtor’s expense, to take the following actions
with respect to the following Collateral:

 

4.1.                              Promissory Notes and Tangible Chattel Paper.
If the Debtor shall at any time hold or acquire any promissory notes or
tangible chattel paper, the Debtor shall forthwith endorse, assign and deliver
the same to the Secured Party, accompanied by such instruments of transfer or
assignment duly executed in blank as the Secured Party may from time to time
specify.

 

4.2.                              Deposit Accounts. For each deposit account
that the Debtor at any time opens or maintains, the Debtor shall, at the
Secured Party’s request and option, pursuant to an agreement in form and substance
satisfactory to the Secured Party, either (a) cause the depositary bank to
comply at any time with instructions from the Secured Party to such depositary
bank directing the disposition of funds from time to time credited to such
deposit account, without further consent of the Debtor, or (b) arrange for the
Secured Party to become the customer of the depositary bank with respect to the
deposit account, with the Debtor being permitted, only with the consent of the
Secured Party, to exercise rights to withdraw funds from such deposit account.
The provisions of this paragraph shall not apply to (i) any deposit account for
which the Debtor, the depositary bank and the Secured Party have entered into a
cash collateral agreement specially negotiated among the Debtor, the depositary
bank and the Secured Party for the specific purpose set forth therein, (ii) a
deposit account for which the Secured Party is the depositary bank and is in
automatic control, and (iii) deposit accounts specially and exclusively used for
payroll, payroll taxes and other employee wage and benefit payments to or for
the benefit of the Debtor’s salaried employees.

 

2

 

4.3.                              Investment Property. If the Debtor shall at
any time hold or acquire any certificated securities, the Debtor shall
forthwith endorse, assign and deliver the same to the Secured Party,
accompanied by such instruments of transfer or assignment duly executed in
blank as the Secured Party may from time to time specify. If any securities now
or hereafter acquired by the Debtor are uncertificated and are issued to the
Debtor or its nominee directly by the issuer thereof, the Debtor shall
immediately notify the Secured Party thereof and, at the Secured Party’s
request and option, pursuant to an agreement in form and substance satisfactory
to the Secured Party, either (a) cause the issuer to agree to comply with
instructions from the Secured Party as to such securities, without further
consent of the Debtor or such nominee, or (b) arrange for the Secured Party to
become the registered owner of the securities. If any securities, whether
certificated or uncertificated, or other investment property now or hereafter
acquired by the Debtor are held by the Debtor or its nominee through a
securities intermediary or commodity intermediary, the Debtor shall immediately
notify the Secured Party thereof and, at the Secured Party’s request and
option, pursuant to an agreement in form and substance satisfactory to the
Secured Party, either (i) cause such securities intermediary or (as the case
may be) commodity intermediary to agree to comply with entitlement orders or
other instructions from the Secured Party to such securities intermediary as to
such securities or other investment property, or (as the case may be) to apply
any value distributed on account of any commodity contract as directed by the
Secured Party to such commodity intermediary, in each case without further
consent of the Debtor or such nominee, or (ii) in the case of financial assets
or other investment property held through a securities intermediary, arrange
for the Secured Party to become the entitlement holder with respect to such
investment property, with the Debtor being permitted, only with the consent of
the Secured Party, to exercise rights to withdraw or otherwise deal with such
investment property.  The provisions of
this paragraph shall not apply to any financial assets credited to a securities
account for which the Secured Party is the securities intermediary.

 

4.4.                              Collateral in the Possession of a Bailee. If
any Collateral is at any time in the possession of a bailee, the Debtor shall
promptly notify the Secured Party thereof and, at the Secured Party’s request
and option, shall promptly obtain an acknowledgment from the bailee, in form
and substance satisfactory to the Secured Party, that the bailee holds such
Collateral for the benefit of the Secured Party, and that such bailee agrees to
comply, without further consent of the Debtor, with instructions from the Secured
Party as to such Collateral.

 

4.5.                              Electronic Chattel Paper and Transferable
Records. If the Debtor at any time holds or acquires an interest in any
electronic chattel paper or any “transferable record,” as that term is defined
in Section 201 of the federal Electronic Signatures in Global and National
Commerce Act, or in Section 16 of the Uniform Electronic Transactions Act
as in effect in any relevant jurisdiction, the Debtor shall promptly notify the
Secured Party thereof and, at the request and option of the Secured Party,
shall take such action as the Secured Party may reasonably request to vest in
the Secured Party control, under Section 9-105 of the Uniform Commercial
Code, of such electronic chattel paper or control under Section 201 of the
federal Electronic Signatures in Global and National Commerce Act or, as the
case may be, Section 16 of the Uniform Electronic Transactions Act, as so
in effect in such jurisdiction, of such transferable record.

 

3

 

4.6.                              Letter-of-Credit Rights. If the Debtor is at
any time a beneficiary under a letter of credit, the Debtor shall promptly
notify the Secured Party thereof and, at the request and option of the Secured
Party, the Debtor shall, pursuant to an agreement in form and substance
satisfactory to the Secured Party, either (i) arrange for the issuer and any
confirmer or other nominated person of such letter of credit to consent to an
assignment to the Secured Party of the proceeds of the letter of credit, or (ii)
arrange for the Secured Party to become the transferee beneficiary of the
letter of credit, with the Secured Party agreeing, in each case, that the
proceeds of the letter to credit are to be applied as provided in the Loan
Agreement.

 

4.7                                 Commercial Tort Claims. If the Debtor shall
at any time hold or acquire a commercial tort claim, the Debtor shall
immediately notify the Secured Party in a writing signed by the Debtor of the
particulars thereof and grant to the Secured Party in such writing a security interest
therein and in the proceeds thereof, all upon the terms of this Agreement, with
such writing to be in form and substance satisfactory to the Secured Party.

 

4.8.                              Other Actions as to Any and All Collateral.
The Debtor further agrees, at the request and option of the Secured Party, to
take any and all other actions the Secured Party may determine to be necessary
or useful for the attachment, perfection and first priority of, and the ability
of the Secured Party to enforce, the Secured Party’s security interest in any
and all of the Collateral, including, without limitation, (a) executing,
delivering and, where appropriate, filing financing statements and amendments
relating thereto under the Uniform Commercial Code, to the extent, if any, that
the Debtor’s signature thereon is required therefor, (b) causing the Secured
Party’s name to be noted as secured party on any certificate of title for a
titled good if such notation is a condition to attachment, perfection or
priority of, or ability of the Secured Party to enforce, the Secured Party’s
security interest in such Collateral, (c) complying with any provision of any
statute, regulation or treaty of the United States as to any Collateral if
compliance with such provision is a condition to attachment, perfection or
priority of, or ability of the Secured Party to enforce, the Secured Party’s
security interest in such Collateral, (d) obtaining governmental and other
third party waivers, consents and approvals in form and substance satisfactory
to Secured Party, including, without limitation, any consent of any licensor,
lessor or other person obligated on Collateral, (e) obtaining waivers from
mortgagees and landlords in form and substance satisfactory to the Secured
Party and (f) taking all actions under any earlier versions of the Uniform
Commercial Code or under any other law, as reasonably determined by the Secured
Party to be applicable in any relevant Uniform Commercial Code or other
jurisdiction, including any foreign jurisdiction.

 

5.                                       Relation to Other Security Documents. The
provisions of this Agreement supplement the provisions of any real estate
mortgage or deed of trust granted by the Debtor to the Secured Party which
secures the payment or performance of any of the Obligations. Nothing contained
in any such real estate mortgage or deed of trust shall derogate from any of
the rights or remedies of the Secured Party hereunder.

 

6.                                       Representations and Warranties Concerning
Debtor’s Legal Status. The Debtor has concurrently executed and delivered the
Loan Agreement to the Secured Party. The Debtor represents and warrants to the
Secured Party that all representations, warranties and other information set
forth

 

4

 

in
the Loan Agreement pertaining to the Debtor is accurate and complete.  The Debtor further represents and warrants
that:

 

(a)                                  The Wornick Company is a Delaware
corporation.  The Wornick Company’s
Secretary of State organization number is 3731379 and its taxpayer
identification number is 30-0225741.  The
sole shareholder of The Wornick Company is TWC Holding, LLC, a Delaware limited
liability company.  The members of the
board of directors and the executive officers of The Wornick Company prior to
and after the closing of the Asset Transaction are and will be as set forth in
Schedule 1 hereto.  The principal
office of The Wornick Company is10825 Kenwood Road, Cincinnati, Ohio
45242.  The mailing address of The
Wornick Company is The Wornick Company, Attention: Larry L. Rose, President and
CEO, 10825 Kenwood Road, Cincinnati, Ohio 45242, with copy to Robert B. McKeon,
Veritas Capital Management II L.L.C., 660 Madison Avenue, New York, New York,
10021.

 

(b)                                 Right Away Management Corporation is a
Delaware corporation.  Right Away
Management Corporation’s Secretary of State organization number is 3742360, and
its taxpayer identification number is 36-4547729.  The sole shareholder of Right Away Management
Corporation is The Wornick Company, a Delaware corporation.  The members of the board of directors and the
executive officers of Right Away Management Corporation prior to and after the
closing of the Asset Transaction are and will be as set forth in
Schedule 1 hereto.  The principal
office of Right Away Management Corporation is c/o Veritas Capital Management
II L.L.C., 660 Madison Avenue, New York, New York 10021. The mailing address of
Right Away Management Corporation is Right Away Management Corporation,
Attention: Keith E. Frase, President and CEO, 200 North 1st Street,
McAllen, Texas 78501, with copy to Robert B. McKeon, Veritas Capital Management
II L.L.C., 660 Madison Avenue, New York, New York 10021.

 

(c)                                  The Wornick Company Right Away Division is a
Delaware corporation.  The Wornick
Company Right Away Division’s Secretary of State organization number is
3742362, and its taxpayer identification number is 35-2223696.  The sole shareholder of The Wornick Company
Right Away Division is The Wornick Company, a Delaware corporation.  The members of the board of directors and the
executive officers of The Wornick Company Right Away Division prior to and
after the closing of the Asset Transaction are and will be as set forth in
Schedule 1 hereto.  The principal
office of The Wornick Company Right Away Division is c/o Veritas Capital
Management II L.L.C., 660 Madison Avenue, New York, New York 10021. The mailing
address of The Wornick Company Right Away Division is The Wornick Company,
Attention: Larry L. Rose, President and CEO, 10825 Kenwood Road, Cincinnati,
Ohio 45242, with copy to Robert B. McKeon, Veritas Capital Management II
L.L.C., 660 Madison Avenue, New York, New York 10021.

 

(d)                                 The Wornick Company Right Away Division, L.P.
is a Delaware limited partnership.

 

5

 

The
Wornick Company Right Away Division, L.P.’s Secretary of State organization
number is 3744423, and its taxpayer identification number is 32-0105479.  The current partners of The Wornick Company
Right Away Division, L.P. are: General Partner -  Right Away Management Corporation, a Delaware
corporation owning 0.1% of the limited partnership and Limited Partner -  The Wornick Company Right Away Division, a
Delaware corporation owning 99.9% of the limited partnership.  The principal office of The Wornick Company
Right Away Division, L.P. is located 200 North 1st Street, McAllen,
Texas 78501. The mailing address of The Wornick Company Right Away Division,
L.P.  is c/o Right Away Management
Corporation, Attention: Keith E. Frase, President and CEO, 200 North 1st
Street, McAllen, Texas 78501, with copy to Robert B. McKeon, Veritas Capital
Management II L.L.C. 660, Madison Avenue, New York, New York 10021.

 

7.                                       Covenants Concerning Debtor’s Legal Status.
The Debtor covenants with the Secured Party as follows: (a) without providing
at least 30 days’ prior written notice to the Secured Party, the Debtor will
not change its name, its place of business or, if more than one, chief
executive office, or its mailing address or organizational identification
number if it has one, (b) if the Debtor does not have an organizational
identification number and later obtains one, the Debtor shall forthwith notify
the Secured Party of such organizational identification number, and (c) the
Debtor will not change its type of organization, jurisdiction of organization
or other legal structure.

 

8.                                       Representations and Warranties Concerning
Collateral, etc. The Debtor further represents and warrants to the Secured
Party as follows: (a) the Debtor is the owner of the Collateral, free from any
right or claim or any person or any adverse lien, security interest or other
encumbrance, except for the security interest created by this Agreement and
other liens permitted by the Loan Agreement, (b) none of the Collateral
constitutes, or is the proceeds of, “farm products” as defined in Section 9-102(a)(34)
of the Uniform Commercial Code of the State, (c)the Debtor holds no commercial
tort claim,  (d) the Debtor has at all
times operated its business in compliance with all applicable provisions of the
federal Fair Labor Standards Act, as amended, and with all applicable
provisions of federal, state and local statutes and ordinances dealing with the
control, shipment, storage or disposal of hazardous materials or substances,
(e) all other information set forth herein or in the Loan Agreement pertaining
to the Collateral is accurate and complete, and (g) that there has been no
change in any information provided herein or in the Loan Agreement since the
date on which it was executed by the Debtor.

 

9.                                       Covenants Concerning Collateral, etc. The Debtor
further covenants with the Secured Party as follows: (a) the Collateral, to the
extent not delivered to the Secured Party pursuant to Section 4, will be
kept at the Property and the Debtor will not remove the Collateral from such
locations, without providing at least thirty days’ prior written notice to the
Secured Party, (b) except for the security interest herein granted and liens
permitted by the Loan Agreement, the Debtor shall be the owner of the
Collateral free from any right or claim of any other person, lien, security
interest or other encumbrance, and the Debtor shall defend the same against all
claims and demands of all persons at any time claiming the same or any
interests therein adverse to the Secured Party, (c) the Debtor shall not pledge,
mortgage or create, or suffer to exist any right of any person in or claim by

 

6

 

any
person to the Collateral, or any security interest, lien or encumbrance in the
Collateral in favor of any person, other than the Secured Party except for
liens permitted by the Loan Agreement, (d) the Debtor will keep the Collateral
in good order and repair and will not use the same in violation of law or any
policy of insurance thereon, (e) the Debtor will permit the Secured Party, or
its designee, to inspect the Collateral at any reasonable time, wherever
located, (f) the Debtor will pay promptly when due all taxes, assessments,
governmental charges and levies upon the Collateral or incurred in connection
with the use or operation of such Collateral or incurred in connection with
this Agreement, (g) the Debtor will continue to operate, its business in
compliance with all applicable provisions of the federal Fair Labor Standards
Act, as amended, and with all applicable provisions of federal, state and local
statutes and ordinances dealing with the control, shipment, storage or disposal
of hazardous materials or substances, and (h) the Debtor will not sell or
otherwise dispose, or offer to sell or otherwise dispose, of the Collateral or
any interest therein except for dispositions permitted by the Loan Agreement,
and sales of Inventory in the ordinary course of Debtor’s business.

 

10.                                 Insurance.

 

10.1.                        Maintenance of Insurance. The Debtor will
maintain with financially sound and reputable insurers insurance with respect
to its properties and business against such casualties and contingencies as
shall be in accordance with general practices of businesses engaged in similar
activities in similar geographic areas. Such insurance shall be in such minimum
amounts that the Debtor will not be deemed a co-insurer under applicable
insurance laws, regulations and policies and otherwise shall be in such
amounts, contain such terms, be in such forms and be for such periods as may be
reasonably satisfactory to the Secured Party. In addition, all such insurance
shall be payable to the Secured Party as additional insured, mortgagee or loss
payee (as directed by Secured, and in the absence of such direction, as
additional insured). Without limiting the foregoing, the Debtor will (i) keep
all of its physical property insured with casualty or physical hazard insurance
on an “all risks” basis, with broad form flood and earthquake coverages and
electronic data processing coverage, with a full replacement cost endorsement
and an “agreed amount” clause in an amount equal to 100% of the full
replacement cost of such property, (ii) maintain all such workers’ compensation
or similar insurance as may be required by law, and (iii) maintain, in amounts
and with deductibles equal to those generally maintained by businesses engaged
in similar activities in similar geographic areas, general public liability
insurance against claims of bodily injury, death or property damage occurring,
on, in or about the properties of the Debtor; business interruption insurance;
and product liability insurance.

 

10.2.                        Insurance Proceeds. The proceeds of any
casualty insurance in respect of any casualty loss of any of the Collateral
shall, subject to the rights, if any, of other parties with an interest having
priority in the property covered thereby, be held by the Secured Party as cash
collateral for the Obligations. The Secured Party may, at its sole option,
disburse from time to time all or any part of such proceeds so held as cash
collateral, upon such terms and conditions as the Secured Party may reasonably
prescribe, for direct application by the Debtor solely to the repair or
replacement of the Debtor’s property so damaged or destroyed, or the Secured
Party may apply all or any part of such proceeds to the Obligations.

 

7

 

10.3.                        Continuation of Insurance. All policies of
insurance shall provide for at least 30 days’ prior written cancellation notice
to the Secured Party.  In the event of
failure by the Debtor to provide and maintain insurance as herein provided, the
Secured Party may, at its option, provide such insurance and charge the amount
thereof to the Debtor. The Debtor shall furnish the Secured Party with
certificates of insurance and policies evidencing compliance with the foregoing
insurance provision.

 

11.                                 Collateral Protection Expenses; Preservation
of Collateral.

 

11.1.                        Expenses Incurred by Secured Party. In the
Secured Party’s discretion, if the Debtor fails to do so, the Secured Party may
discharge taxes and other encumbrances at any time levied or placed on any of
the Collateral, maintain any of the Collateral, make repairs thereto and pay
any necessary filing fees or insurance premiums. The Debtor agrees to reimburse
the Secured Party on demand for all expenditures so made. The Secured Party
shall have no obligation to the Debtor to make any such expenditures, nor shall
the making thereof be construed as the waiver or cure of any Default or Event
of Default.

 

11.2.                        Secured Party’s Obligations and Duties.
Anything herein to the contrary notwithstanding, the Debtor shall remain
obligated and liable under each contract or agreement comprised in the
Collateral to be observed or performed by the Debtor thereunder. The Secured
Party shall not have any obligation or liability under any such contract or
agreement by reason of or arising out of this Agreement or the receipt by the
Secured Party of any payment relating to any of the Collateral, nor shall the
Secured Party be obligated in any manner to perform any of the obligations of
the Debtor under or pursuant to any such contract or agreement, to make inquiry
as to the nature or sufficiency of any payment received by the Secured Party in
respect of the Collateral or as to the sufficiency of any performance by any
party under any such contract or agreement, to present or file any claim, to
take any action to enforce any performance or to collect the payment of any
amounts which may have been assigned to the Secured Party or to which the
Secured Party may be entitled at any time or times. The Secured Party’s sole
duty with respect to the custody, safe keeping and physical preservation of the
Collateral in its possession, under Section 9-207 of the Uniform
Commercial Code of the State or otherwise, shall be to deal with such
Collateral in the same manner as the Secured Party deals with similar property
for its own account.

 

12.                                 Securities and Deposits.  The Secured Party may at any time, at its
option, transfer to itself or any nominee any securities constituting
Collateral, receive any income thereon and hold such income as additional
Collateral or apply it to the Obligations. Whether or not any Obligations are
due, the Secured Party may demand, sue for, collect, or make any settlement or
compromise which it deems desirable with respect to the Collateral. Regardless
of the adequacy of Collateral or any other security for the Obligations, any
deposits or other sums at any time credited by or due from the Secured Party to
the Debtor may at any time be applied to or set off against any of the
Obligations.

 

13.                                 Notification to Account Debtors and Other
Persons Obligated on Collateral. The Debtor shall, at the request and option of
the Secured Party, notify account debtors and other persons

 

8

 

obligated
on any of the Collateral of the security interest of the Secured Party in any
account, chattel paper, general intangible, instrument or other Collateral and
that payment thereof is to be made directly to the Secured Party or to any
financial institution designated by the Secured Party as the Secured Party’s
agent therefor, and the Secured Party may itself, without notice to or demand
upon the Debtor, so notify account debtors and other persons obligated on
Collateral. After the making of such a request or the giving of any such
notification, the Debtor shall hold any proceeds of collection of accounts,
chattel paper, general intangibles, instruments and other Collateral received
by the Debtor as trustee for the Secured Party without commingling the same
with other funds of the Debtor and shall turn the same over to the Secured
Party in the identical form received, together with any necessary endorsements
or assignments. The Secured Party shall apply the proceeds of collection of
accounts, chattel paper, general intangibles, instruments and other Collateral
received by the Secured Party to the Obligations, such proceeds to be
immediately credited after final payment in cash or other immediately available
funds of the items giving rise to them.

 

14.                                 Power of Attorney.

 

14.1.                        Appointment and Powers of Secured Party. The
Debtor hereby irrevocably constitutes and appoints the Secured Party and any
officer or agent thereof, with full power of substitution, as its true and
lawful attorneys-in-fact with full irrevocable power and authority in the place
and stead of the Debtor or in the Secured Party’s own name, for the purpose of
carrying out the terms of this Agreement, to take any and all appropriate action
and to execute any and all documents and instruments that may be necessary or
useful to accomplish the purposes of this Agreement and, without limiting the
generality of the foregoing, hereby gives said attorneys the power and right,
on behalf of the Debtor, without notice to or assent by the Debtor, to do the
following:

 

(a)                                  upon the occurrence and during the
continuance of an Event of Default, generally to sell, transfer, pledge, make
any agreement with respect to or otherwise dispose of or deal with any of the
Collateral in such manner as is consistent with the Uniform Commercial Code of
the State, or other applicable jurisdiction, and as fully and completely as
though the Secured Party were the absolute owner thereof for all purposes, and
to do, at the Debtor’s expense, at any time, or from time to time, all acts and
things which the Secured Party deems necessary or useful to protect, preserve
or realize upon the Collateral and the Secured Party’s security interest
therein, in order to effect the intent of this Agreement, all at least as fully
and effectively as the Debtor might do, including, without limitation, (i) the
filing and prosecuting of registration and transfer applications with the
appropriate federal, state, local or other agencies or authorities with respect
to trademarks, copyrights and patentable inventions and processes, (ii) upon
written notice to the Debtor, the exercise of voting rights with respect to
voting securities (including the voting rights with respect to the Ownership Interests),
which rights may be exercised, if the Secured Party so elects, with a view to
causing the liquidation of assets of the issuer of any such securities, and
(iii) the execution, delivery and recording, in connection with any sale or
other disposition of any Collateral, of the endorsements, assignments or other
instruments of conveyance or transfer with respect to such Collateral; and

 

9

 

(b)                                 to the extent that the Debtor’s authorization
given in Section 3 is not sufficient, to file such financing statements
with respect hereto, with or without the Debtor’s signature, or a photocopy of
this Agreement in substitution for a financing statement, as the Secured Party
may deem appropriate and to execute in the Debtor’s name such financing
statements and amendments thereto and continuation statements which may require
the Debtor’s signature.

 

14.2.                        Ratification by Debtor. To the extent
permitted by law, the Debtor hereby ratifies all that said attorneys shall lawfully
do or cause to be done by virtue hereof. This power of attorney is a power
coupled with an interest and is irrevocable.

 

14.3.                        No Duty on Secured Party. The powers
conferred on the Secured Party hereunder are solely to protect its interests in
the Collateral and shall not impose any duty upon it to exercise any such
powers. The Secured Party shall be accountable only for the amounts that it
actually receives as a result of the exercise of such powers, and neither it
nor any of its officers, directors, employees or agents shall be responsible to
the Debtor for any act or failure to act, except for the Secured Party’s own
gross negligence or willful misconduct.

 

15.                                 Rights and Remedies. If an Event of Default
shall have occurred and be continuing, the Secured Party, without any other
notice to or demand upon the Debtor have in any jurisdiction in which
enforcement hereof is sought, in addition to all other rights and remedies, the
rights and remedies of a secured party under the Uniform Commercial Code of the
State and any additional rights and remedies which may be provided to a secured
party in any jurisdiction in which Collateral is located, including, without
limitation, the right to take possession of the Collateral, and for that
purpose the Secured Party may, so far as the Debtor can give authority
therefor, enter upon any premises on which the Collateral may be situated and
remove the same therefrom. The Secured Party may in its discretion require the
Debtor to assemble all or any part of the Collateral at such location or
locations within the jurisdiction(s) of the Debtor’s principal office(s) or at
such other locations as the Secured Party may reasonably designate. Unless the
Collateral is perishable or threatens to decline speedily in value or is of a
type customarily sold on a recognized market, the Secured Party shall give to
the Debtor at least five Business Days’ prior written notice of the time and
place of any public sale of Collateral or of the time after which any private
sale or any other intended disposition is to be made. The Debtor hereby
acknowledges that five Business Days’ prior written notice of such sale or
sales shall be reasonable notice. In addition, the Debtor waives any and all
rights that it may have to a judicial hearing in advance of the enforcement of
any of the Secured Party’s rights and remedies hereunder, including, without
limitation, its right following an Event of Default to take immediate
possession of the Collateral and to exercise its rights and remedies with respect
thereto.

 

16.                                 Standards for Exercising Rights and Remedies.
To the extent that applicable law imposes duties on the Secured Party to
exercise remedies in a commercially reasonable manner, the Debtor acknowledges
and agrees that it is not commercially unreasonable for the Secured Party (a)
to fail to incur expenses reasonably deemed significant by the Secured Party to
prepare Collateral for disposition or otherwise to fail to complete raw
material or work in process into finished goods or other finished products for
disposition, (b) to fail to obtain third party consents for access to 

 

10

 

Collateral
to be disposed of, or to obtain or, if not required by other law, to fail to
obtain governmental or third party consents for the collection or disposition
of Collateral to be collected or disposed of, (c) to fail to exercise
collection remedies against account debtors or other persons obligated on
Collateral or to fail to remove liens or encumbrances on or any adverse claims
against Collateral, (d) to exercise collection remedies against account debtors
and other persons obligated on Collateral directly or through the use of
collection agencies and other collection specialists, (e) to advertise
dispositions of Collateral through publications or media of general
circulation, whether or not the Collateral is of a specialized nature, (f) to
contact other persons, whether or not in the same business as the Debtor, for
expressions of interest in acquiring all or any portion of the Collateral, (g)
to hire one or more professional auctioneers to assist in the disposition of
Collateral, whether or not the collateral is of a specialized nature, (h) to
dispose of Collateral by utilizing Internet sites that provide for the auction
of assets of the types included in the Collateral or that have the reasonable
capability of doing so, or that match buyers and sellers of assets, (i) to
dispose of assets in wholesale rather than retail markets, (j) to disclaim
disposition warranties, (k) to purchase insurance or credit enhancements to
insure the Secured Party against risks of loss, collection or disposition of
Collateral or to provide to the Secured Party a guaranteed return from the
collection or disposition of Collateral, or (l) to the extent deemed
appropriate by the Secured Party, to obtain the services of other brokers,
investment bankers, consultants and other professionals to assist the Secured
Party in the collection or disposition of any of the Collateral.  The Debtor acknowledges that the purpose of
this Section 16 is to provide non-exhaustive indications of what actions
or omissions by the Secured Party would fulfill the Secured Party’s duties
under the Uniform Commercial Code or other law of the State or any other relevant
jurisdiction in the Secured Party’s exercise of remedies against the Collateral
and that other actions or omissions by the Secured Party shall not be deemed to
fail to fulfill such duties solely on account of not being indicated in this
Section 16. Without limitation upon the foregoing, nothing contained in
this Section 16 shall be construed to grant any rights to the Debtor or to
impose any duties on the Secured Party that would not have been granted or
imposed by this Agreement or by applicable law in the absence of this
Section 16.

 

17.                                 No Waiver by Secured Party, etc. The Secured
Party shall not be deemed to have waived any of its rights or remedies in
respect of the Obligations or the Collateral unless such waiver shall be in
writing and signed by the Secured Party. No delay or omission on the part of
the Secured Party in exercising any right or remedy shall operate as a waiver
of such right or remedy or any other right or remedy. A waiver on any one
occasion shall not be construed as a bar to or waiver of any right or remedy on
any future occasion. All rights and remedies of the Secured Party with respect
to the Obligations or the Collateral, whether evidenced hereby or by any other
instrument or papers, shall be cumulative and may be exercised singularly,
alternatively, successively or concurrently at such time or at such times as
the Secured Party deems expedient.

 

18.                                 Suretyship Waivers by Debtor. The Debtor
waives demand, notice, protest, notice of acceptance of this Agreement, notice
of loans made, credit extended, Collateral received or delivered or other
action taken in reliance hereon and all other demands and notices of any
description. With respect to both the Obligations and the Collateral, the
Debtor assents to any extension or postponement of the time of payment or any
other indulgence, to any substitution, exchange or release of or failure to
perfect any security interest in any Collateral, to the addition or release of
any 

 

11

 

party
or person primarily or secondarily liable, to the acceptance of partial payment
thereon and the settlement, compromising or adjusting of any thereof, all in
such manner and at such time or times as the Secured Party may deem advisable.
The Secured Party shall have no duty as to the collection or protection of the
Collateral or any income therefrom, the preservation of rights against prior
parties, or the preservation of any rights pertaining thereto beyond the safe
custody thereof as set forth in Section 11.2. The Debtor further waives
any and all other suretyship defenses.

 

19.                                 Marshaling. The Secured Party shall not be
required to marshal any present or future collateral security (including but
not limited to the Collateral) for, or other assurances of payment of, the
Obligations or any of them or to resort to such collateral security or other
assurances of payment in any particular order, and all of its rights and
remedies hereunder and in respect of such collateral security and other
assurances of payment shall be cumulative and in addition to all other rights
and remedies, however existing or arising. To the extent that it lawfully may,
the Debtor hereby agrees that it will not invoke any law relating to the
marshaling of collateral which might cause delay in or impede the enforcement
of the Secured Party’s rights and remedies under this Agreement or under any
other instrument creating or evidencing any of the Obligations or under which
any of the Obligations is outstanding or by which any of the Obligations is secured
or payment thereof is otherwise assured, and, to the extent that it lawfully
may, the Debtor hereby irrevocably waives the benefits of all such laws.

 

20.                                 Indemnity and Expenses.

 

Debtor
agrees:

 

(a)                                  To indemnify and hold harmless the Released
Parties (hereinafter defined) from and against any and all claims, damages,
demands, losses, obligations, judgments and liabilities (including, without
limitation, reasonable attorneys’ fees and expenses) in any way arising out of
or in connection with this Agreement or the Obligations, except to the extent
the same shall arise as a result of the gross negligence or willful misconduct
of the party seeking to be indemnified; and

 

(b)                                 To pay and reimburse Secured Party upon
demand for all reasonable costs and expenses (including, without limitation,
reasonable attorneys’ fees and expenses) that Secured Party may incur in
connection with (i) the custody, use or preservation of, or the sale of,
collection from or other realization upon, any of the Collateral, including the
reasonable expenses of re-taking, holding, preparing for sale or lease, selling
or otherwise disposing of or realizing on the Collateral, (ii) the exercise or
enforcement of any rights or remedies granted hereunder, under the Loan
Agreement, or under any of the other Loan Documents or otherwise available to
it (whether at law, in equity or otherwise), or (iii) the failure by Debtor to
perform or observe any of the provisions hereof. The provisions of this
Section shall survive the execution and delivery of this Agreement, the
repayment of any of the Obligations, the termination of the commitments of
Secured Party under the Loan Agreement and the termination of this Agreement or
any other Loan Document.

 

21.                                 Duties of Secured Party.    The powers conferred on Secured Party
hereunder are solely to protect its interests in the Collateral and shall not
impose on it any duty to exercise such powers. Except as provided in
Section 9-207 of the Code, Secured Party shall have no duty with 

 

12

 

respect
to the Collateral or any responsibility for taking any necessary steps to
preserve rights against any Persons with respect to any Collateral.  It is also expressly understood and agreed
that except for the obligation of “honesty in fact” as provided in
Section 1.203 of the Texas Business and Commerce Code (to the extent
applicable), the Secured Party, in exercising its rights and performing its
obligations under any of the Loan Documents, owes no duty of good faith and/or
fair dealing to Debtor, Obligor, any guarantor of the Obligations, or any
shareholder of Obligor, and no fiduciary duty exists between or among Debtor,
Obligor, any guarantor of the Obligations, any shareholder of Obligor, and the
Secured Party.

 

22.                                 Disposition of Proceeds.  After deducting all expenses, the residue of
any proceeds of collection or sale or other disposition of the Collateral
shall, to the extent actually received in cash, be applied to the payment of
the Obligations in such order or preference as the Secured Party may determine,
proper allowance and provision being made for any Obligations not then due.
Upon the final payment and satisfaction in full of all of the Obligations and
after making any payments required by Sections 9-608(a)(1)(C) or 9-615(a)(3) of
the Uniform Commercial Code of the State, any excess shall be returned to the
Debtor. In the absence of final payment and satisfaction in full of all of the
Obligations, the Debtor shall remain liable for any deficiency.

 

23.                                 Overdue Amounts. Until paid, all amounts due
and payable by the Debtor hereunder shall be a debt secured by the Collateral
and shall bear, whether before or after judgment, interest at the rate of
interest for overdue principal set forth in the Loan Agreement.

 

24.                                 Governing Law; Consent to Jurisdiction. THIS
AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF TEXAS. The Debtor and Secured Party agree that any action or claim
arising out of, or any dispute in connection with, this Agreement, any rights,
remedies, obligations, or duties hereunder, or the performance or enforcement
hereof or thereof, shall be decided by binding arbitration as set forth in the
Loan Agreement.

 

25.                                 Miscellaneous. The headings of each
section of this Agreement are for convenience only and shall not define or
limit the provisions thereof. This Agreement and all rights and obligations
hereunder shall be binding upon the Debtor and its respective successors and
assigns, and shall inure to the benefit of the Secured Party and its successors
and assigns.  If any term of this
Agreement shall be held to be invalid, illegal or unenforceable, the validity
of all other terms hereof shall in no way be affected thereby, and this
Agreement shall be construed and be enforceable as if such invalid, illegal or
unenforceable term had not been included herein. The Debtor acknowledges
receipt of a copy of this Agreement.

 

IN
WITNESS WHEREOF, intending to be legally bound, the Debtor and Secured Party
have caused this Agreement to be duly executed as of the date first above
written.

 

[SIGNATURE PAGES FOLLOW]

 

13

 

	
   

  	
  DEBTOR:

  
	
   

  	
   

  
	
   

  	
  THE
  WORNICK COMPANY, a Delaware

  corporation

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert B. McKeon

  	
   

  
	
   

  	
   

  	
  Robert
  B. McKeon

  
	
   

  	
   

  	
  Chairman
  of the Board

  
	
   

  	
   

  	
  Address:  c/o Veritas Capital

  
	
   

  	
   

  	
  Management
  II L.L.C.

  
	
   

  	
   

  	
  660
  Madison Avenue

  
	
   

  	
   

  	
  New
  York, New York 10021

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  THE
  WORNICK COMPANY RIGHT AWAY

  DIVISION, L.P., a Delaware limited

  partnership

  
	
   

  	
   

  
	
   

  	
  By:

  	
  Right
  Away Management Corporation,

  a Delaware corporation, its general

  partner

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Robert B. McKeon

  	
   

  
	
   

  	
   

  	
   

  	
  Name:  Robert B. McKeon

  
	
   

  	
   

  	
   

  	
  Title:    Chairman
  of the Board

  
	
   

  	
   

  
	
   

  	
  Address:  c/o Veritas Capital

  
	
   

  	
  Management
  II L.L.C.

  
	
   

  	
  660
  Madison Avenue

  
	
   

  	
  New
  York, New York 10021

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  RIGHT
  AWAY MANAGEMENT

  CORPORATION

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert B. McKeon

  	
   

  
	
   

  	
   

  	
  Name:  Robert B. McKeon

  
	
   

  	
   

  	
  Title:    Chairman of the Board

  
	
   

  	
   

  	
   

  
	
   

  	
  Address:  c/o Veritas Capital

  
	
   

  	
  Management
  II L.L.C.

  
	
   

  	
  660
  Madison Avenue

  
	
   

  	
  New
  York, New York 10021

  
					

 

14

 

	
   

  	
  THE
  WORNICK COMPANY RIGHT AWAY

  DIVISION

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Robert B. McKeon

  	
   

  
	
   

  	
   

  	
  Name:  Robert B. McKeon

  
	
   

  	
   

  	
  Title:    Chairman of the Board

  
	
   

  	
   

  
	
   

  	
  Address:  c/o
  Veritas Capital

  
	
   

  	
  Management
  II L.L.C.

  
	
   

  	
  660
  Madison Avenue

  
	
   

  	
  New
  York, New York 10021

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  SECURED
  PARTY:

  
	
   

  	
   

  
	
   

  	
  TEXAS
  STATE BANK

  
	
   

  	
   

  
	
   

  	
  /s/ Douglas G. Bready

  	
   

  
	
   

  	
  By: 
  Douglas G. Bready

  
	
   

  	
  Its:
    President

  

 

15

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