{"id":41294,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/security-agreement-caldera-systems-inc-and-the-canopy-group.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"security-agreement-caldera-systems-inc-and-the-canopy-group","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/finance\/security-agreement-caldera-systems-inc-and-the-canopy-group.html","title":{"rendered":"Security Agreement &#8211; Caldera Systems Inc. and The Canopy Group Inc."},"content":{"rendered":"<pre>\n                               SECURITY AGREEMENT\n\n            THIS SECURITY AGREEMENT (the \"Security Agreement\") is entered into\nas of September 1, 1998, by and between CALDERA SYSTEMS, INC., a Utah\ncorporation (the \"Company\"), and THE CANOPY GROUP, INC., a Utah corporation\n(\"Secured Party\").\n\n                                    RECITALS\n\n      A. Company has borrowed funds and may borrow through subsequent advances\nadditional funds, from Secured Party pursuant to a $2,000,000 Secured\nConvertible Promissory Note of even date herewith (the \"Note\").\n\n      B. As security for its repayment obligations under the Note, Company has\nagreed to grant Secured Party a security interest in all of its assets on the\nterms set forth in this Security Agreement.\n\n            NOW, THEREFORE, to that end and in consideration of the premises,\ncovenants and agreements set forth below, and the mutual benefits to be derived\nfrom this Security Agreement, and other good and valuable consideration, the\nparties hereto agree as follows:\n\n            1. SECURITY INTEREST. To secure the \"Obligation\" (as defined below),\nCompany hereby transfers, conveys, assigns, and grants to Secured Party a\nsecurity interest in all of Company's assets, which may include one or more of\nthe following items (hereinafter, collectively, the \"Collateral\"):\n\n                  (a) GENERAL INTANGIBLES. All of Company's General Intangibles,\nnow existing or hereafter arising or acquired, together with the proceeds\ntherefrom. As used herein, the term \"General Intangibles\" means all personal\nproperty (including things in action) other than goods, accounts, chattel paper,\ndocuments, instruments, and money, and includes, but is not limited to, business\nrecords, deposit accounts, inventions, intellectual property, designs, patents,\npatent applications, trademarks, trademark applications, trademark\nregistrations, service marks, service mark applications, service mark\nregistrations, trade names, goodwill, technology, knowhow, confidential\ninformation, trade secrets, customer lists, supplier lists, copyrights,\ncopyright applications, copyright registrations, licenses, permits, franchises,\ntax refund claims, and any letters of credit, guarantee claims, security\ninterests, or other security held by the Company to secure any \"Accounts\" (as\nhereinafter defined).\n\n                  (b) ACCOUNTS (INCLUDING ACCOUNTS RECEIVABLE). All of Company's\nAccounts, whether now existing or hereafter arising or acquired, together with\nthe proceeds therefrom. As used herein, the term \"Accounts\" means any right of\nCompany to receive payment from another person or entity, including payment for\ngoods sold or leased, or for services rendered, no matter how evidenced or\narising, and regardless of whether yet earned by performance. It includes, but\nis not limited to, accounts, accounts receivable, contract rights,\n\n\n\ncontracts receivable, purchase orders, notes, drafts, acceptances, all rights to\npayment earned or unearned under a charter or other contract involving the use\nor hire of a vessel and all rights incident to the charter or contract, and\nother forms of obligations and receivables.\n\n                  (c) INVENTORY. All of Company's Inventory, whether now owned\nor hereafter acquired, together with the products and proceeds therefrom and all\npackaging, manuals, and instructions related thereto. As used herein, the term\n\"Inventory\" means all goods, merchandise, and personal property held for sale or\nleased or furnished or to be furnished under contracts of service, and all raw\nmaterials, work in process, or materials used or consumed in Company's business,\nwherever located and whether in the possession of Company, a warehouseman, a\nbailee, or any other person.\n\n                  (d) EQUIPMENT. All of Company's Equipment, now owned or\nhereafter acquired, together with the products and proceeds therefrom, and all\nsubstitutes and replacements therefor. As used herein, the term \"Equipment\"\nincludes all equipment, machinery, tools, office equipment, supplies,\nfurnishings, furniture, or other items used or useful, directly or indirectly,\nin Company's business, all accessions, attachments, and other additions thereto,\nall parts used in connection therewith, all packaging, manuals, and instructions\nrelated thereto, and all leasehold or equitable interests therein.\n\n                  (e) FIXTURES. All of Company's interest in and to all fixtures\nand furnishings, now owned or hereafter acquired, together with the products and\nproceeds therefrom, all substitutes and replacements therefor, all accessories,\nattachments, and other additions thereto, all tools, parts, and supplies used in\nconnection therewith, and all packaging, manuals, and instructions related\nthereto, located on or attached to Company's business premises located at 240\nWest Center, Orem, Utah 84058.\n\n                  (f) CHATTEL PAPER, DOCUMENTS AND INSTRUMENTS. All of Company's\nright, title, and interest in any chattel paper, documents, or instruments, now\nowned or hereafter acquired or arising, or now or hereafter coming into the\npossession, control, or custody of either Company or Secured Party, together\nwith all proceeds therefrom. The terms \"chattel paper,\" \"documents,\" and\n\"instruments\" shall have those meanings ascribed to them in the Utah Uniform\nCommercial Code.\n\n            2. OBLIGATION. This security interest is given as security for all\nindebtedness and obligations owed by Company to Secured Party, whether now\nexisting or hereafter incurred, under this Security Agreement or the Note,\ntogether with all extensions, modifications, or renewals thereof (hereinafter\nreferred to, collectively, as the \"Obligation\").\n\n            3. PROCEEDS. As used in this Security Agreement, the term \"proceeds\"\nmeans all products of the Collateral and all additions and accessions to,\nreplacements of, insurance or condemnation proceeds of, and documents covering\nany of the Collateral, all property received wholly or partly in trade or\nexchange for any of the Collateral, all leases of any of the Collateral, and all\nrents, revenues, issues, profits, and proceeds arising from the sale, lease,\nlicense, encumbrance, collection, or any other temporary or permanent\ndisposition, of any of the Collateral or any interest therein.\n\n\n                                       2\n\n            4. TITLE; FILING. Company warrants that, except as previously\ndisclosed in writing to Secured Party, it is the owner of the Collateral free\nand clear of all liens, claims, and encumbrances of whatever kind or nature.\nCompany covenants that so long as any portion of the Obligation remains unpaid,\nCompany will not execute or file a financing statement or security agreement\ncovering the Collateral to anyone other than Secured Party, except in the\nordinary course of business or as otherwise allowed. Company agrees to sign and\ndeliver one or more financing statements or supplements thereto or other\ninstruments as Secured Party may from time to time require to comply with the\nUniform Commercial Code or other applicable law to preserve, protect and enforce\nthe security interest of Secured Party and to pay all costs of filing such\nstatements or instruments. In addition, Company shall promptly file a financing\nstatement to perfect Secured Party's interest in the Collateral.\n\n            5. CARE OF COLLATERAL. Company will keep in effect all licenses,\npermits and franchises required by law or contract relating to Company's\nbusiness (if applicable), property, or the Collateral; maintain insurance on the\nCollateral; keep the Collateral in good repair and be responsible for any loss\nor damage to it; at all times warrant and defend Company's ownership and\npossession of the Collateral keep the Collateral free from all liens, claims,\nencumbrances and security interests; pay when due all taxes, license fees, and\nother charges upon the Collateral or upon Company's business, property or the\nincome therefrom; and not misuse, conceal or in any way use or dispose of the\nCollateral unlawfully or contrary to the provisions of this Security Agreement\nor of any insurance coverage. Loss of, damage to, or uncollectability of the\nCollateral or any part thereof will not release Company from any of its\nobligations hereunder.\n\n            6. DEFAULT. A default hereunder will occur if any of the following\nevents occur: (1) Company fails to pay any portion of the Obligation when due;\n(2) Company fails to perform any undertaking or materially breaches any warranty\nor covenant in this Security Agreement or the Note; (3) any statement,\nrepresentation or warranty of Company under this Security Agreement or the Note\nis untrue in any material respect when made; (4) Company becomes insolvent or\nunable to pay debts as they mature or makes an assignment for the benefit of\ncreditors or any proceeding is instituted by or against it alleging that it is\ninsolvent or unable to pay its debts as they mature; (5) dissolution of Company;\n(6) an attachment, garnishment, execution or other process is issued or a lien\nfiled against any property of Company, which is not removed within a reasonable\nperiod of time; and (7) Company transfers an interest in any of the Collateral\ncontrary to the provisions of this Security Agreement without the prior written\nconsent of Secured Party other than in the ordinary course of business. Waiver\nof any default will not constitute a waiver of any other or subsequent default.\n\n            7. REMEDIES. Upon the occurrence of any default hereunder at any\ntime thereafter, all of the Obligation will, at the election of Secured Party\nand without notice of such election, or demand for payment, become immediately\ndue and payable and Secured Party will have the remedies of a secured party\nunder the Utah Uniform Commercial Code or other applicable law.\n\n            8. GENERAL. The wavier by Secured Party of any breach of any\nprovision of this Security Agreement or warranty or representation herein set\nforth will not be construed as a\n\n\n                                       3\n\nwaiver of any subsequent breach. The failure to exercise any right hereunder by\nSecured Party will not operate as a waiver of such night. All rights and\nremedies herein provided are cumulative. Company may not assign its nights or\ndelegate its duties hereunder without Secured Party's written consent. This\nSecurity Agreement may not be altered or amended except by a writing signed by\nall the parties hereto. This Security Agreement will be governed by and\nconstrued and interpreted in accordance with the laws of the State of Utah. Any\nprovision hereof found to be invalid will not invalidate the remainder. All\nwords used herein will be construed to be of such gender and number as the\ncircumstances require. This Security Agreement binds Company, its successors and\nassigns, and inures to the benefit of Secured Party, its successors and assigns.\n\n            IN WITNESS WHEREOF, the parties have executed this Security\nAgreement as of the date first written above.\n\n\n            COMPANY:                         CALDERA SYSTEMS, INC., \n                                             a Utah corporation\n\n\n                                             By:  \/s\/ RANSOM LOVE\n                                                --------------------------------\n                                                  Ransom Love\n                                             Its: President\n\n            SECURED PARTY:                   THE CANOPY GROUP, INC., \n                                             a Utah corporation\n\n\n                                             By:  \/s\/ RALPH YARRO\n                                                --------------------------------\n                                                  Ralph Yarro \n                                             Its: President\n\n\n\n\n\n\n\n\n                                       4\n\n\nThis FINANCING STATEMENT is presented to a filing officer for filing pursuant to\nthe Uniform Commercial Code.\n\nFor Filing Officer (Date, Time, Number, and Filing Office)\n\n1. Debtor(s) (Last Name First) and address(es)\n\n   CALDERA SYSTEMS, INC.\n   240 WEST CENTER      \n   OREM, UT 84057       \n\n   Social Security or\n                      ------------------\n   Emp. Fed. I.D. No.   87-0617393\n                      ------------------\n\n2. Secured Party(ies) and address(es)\n\n   THE CANOPY GROUP\n   240 WEST CENTER STREET\n   OREM, UTAH 84057\n\n3. Maturity date (if any):\n\n\n\n   Approved by Division of Corporations and Commercial Code, Department of\n   Business Regulations\n\n4. This Financing Statement covers the following types (or items) of property:\n\n   All items listed on the attached Attachment 1 including, but not limited to\n   general intangibles, accounts (including accounts receivable), inventory,\n   equipment, fixtures, and chattel paper, documents and instruments now owned\n   or hereafter acquired.\n\n   The Secured party is [ ] is not [x] a seller or Purchase money lender of the\n   collateral.\n\n5. Assignee(s) of Secured Party and Address(es)\n\n6. Gross sales price of collateral\n   $\n    ---------------------------------\n   $                                  Sales\n    ---------------------------------\n   or use tax paid to State of\n\n\n\n\n\nThis statement is filed without the debtor's signature to perfect a security\ninterest in collateral (Check x if so)\n\n   [ ] already subject to a security interest in another jurisdiction when it\n       was brought into this state. \n   [ ] which is proceeds or the original collateral described above in which a\n       security interest was perfected.\n\n\n                       Microfilm No.\n\n\n\nCheck [X] if covered: [X] Proceeds of Collateral are also covered. [X] Products\nof Collateral are also covered. No. of additional Sheets presented: 1\n\n\n--------------------------------------------------------------------------------\n\n   Caldera Systems, Inc.                            The Canopy Group\n--------------------------------------    --------------------------------------\n\nBy: \/s\/ RANSOM H. LOVE                    By: \/s\/ RALPH YARRO\n   -----------------------------------       -----------------------------------\n       Signature(s) of Debtor(s)             Signature(s) of Secured Party(ies)\n\n                               STANDARD FORM UCC-1\n\n\n\n\n\n\n                                  ATTACHMENT 1\n                         TO FINANCING STATEMENT BETWEEN\n                      CALDERA SYSTEMS, INC, AS DEBTOR, AND\n                       THE CANOPY GROUP, AS SECURED PARTY\n\n                  The security interest covered by this Financing Statement\n      includes the following property:\n\n                        (a) GENERAL INTANGIBLES. All of Debtor's General\nIntangibles, now existing or hereafter arising or acquired, together with the\nproceeds therefrom. As used herein, the term \"General Intangibles\" means all\npersonal property (including things in action) other than goods, accounts,\nchattel paper, documents, instruments, and money, and includes, but is not\nlimited to, business records, deposit accounts, inventions, intellectual\nproperty, designs, patents, patent applications, trademarks, trade names, trade\nsecrets, goodwill, copyrights, registrations, licenses, permits, franchises, tax\nrefund claims, and any letters of credit, guarantee claims, security interests,\nor other security held by Debtor to secure any \"Accounts\" (as hereinafter\ndefined).\n\n                        (b) ACCOUNTS (INCLUDING ACCOUNTS RECEIVABLE). All of\nDebtor's Accounts, whether now existing or hereafter arising or acquired,\ntogether with the proceeds therefrom. As used herein, the term \"Accounts\" means\nany right of Debtor to receive payment from another person or entity, including\npayment for goods sold or leased, or for services rendered, no matter how\nevidenced or arising, and regardless of whether yet earned by performance. It\nincludes, but is not limited to, accounts, accounts receivable, contract rights,\ncontracts receivable, purchase orders, notes, drafts, acceptances, all rights to\npayment earned or unearned under a charter or other contract involving the use\nor hire of a vessel and all rights incident to the charter or contract, and\nother forms of obligations and receivables.\n\n                        (c) INVENTORY. All of Debtor's Inventory, whether now\nowned or hereafter acquired, together with the products and proceeds therefrom\nand all packaging, manuals, and instructions related thereto. As used herein,\nthe term \"Inventory\" means all goods, merchandise, and personal property held\nfor sale or leased or furnished or to be furnished under contracts of service,\nand all raw materials, work in process, or materials used or consumed in\nDebtor's business, wherever located and whether in the possession of Debtor, a\nwarehouseman, a bailee, or any other person.\n\n                        (d) EQUIPMENT. All of Debtor's Equipment, now owned or\nhereafter acquired, together with the products and proceeds therefrom, and all\nsubstitutes and replacements therefor. As used herein, the term \"Equipment\"\nincludes all equipment, machinery, tools, office equipment, supplies,\nfurnishings, furniture, or other items used or useful, directly or indirectly,\nin Company's business, all accessions, attachments, and other additions thereto,\nall parts used in connection therewith, all packaging, manuals, and instructions\nrelated thereto, and all leasehold or equitable interests therein.\n\n                        (e) FIXTURES. All of Debtor's interest in and to all\nfixtures and furnishings, now owned or hereafter acquired, together with the\nproducts and proceeds therefrom, all substitutes and replacements therefor, all\naccessories, attachments, and other additions thereto, all tools, parts, and\nsupplies used in connection therewith, and all packaging, manuals, and\ninstructions related thereto, located on or attached to Debtor's business\npremises located at 240 West Center, Orem, Utah 84057.\n\n                        (f) CHATTEL PAPER, DOCUMENTS AND INSTRUMENTS. All of\nDebtor's right, title, and interest in any chattel paper, documents, or\ninstruments, now owned or hereafter acquired or arising, or now or hereafter\ncoming into the possession, control, or custody of either Debtor or Secured\nParty, together with all proceeds therefrom. The terms \"chattel paper,\"\n\"documents,\" and \"instruments\" shall have those meanings ascribed to them in the\nUtah Uniform Commercial Code.\n\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[6993],"corporate_contracts_industries":[9513],"corporate_contracts_types":[9560,9570],"class_list":["post-41294","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-caldera-systems-inc","corporate_contracts_industries-technology__software","corporate_contracts_types-finance","corporate_contracts_types-finance__security"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/41294","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=41294"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=41294"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=41294"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=41294"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}