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Exhibit 10.6
AGREEMENT AND ACKNOWLEDGMENT OF SECURITY
INTEREST
THIS
AGREEMENT AND ACKNOWLEDGMENT OF SECURITY INTEREST (this
“Agreement”) is entered into as of December 1, 2005, by
and among WELLS FARGO BANK, NATIONAL ASSOCIATION
(“Bank”), MEDTOX DIAGNOSTICS, INC.
(“Debtor”) and POWELL ENTERPRISES, INC.
(“Landlord”).
WHEREAS,
Bank has extended, or has agreed to extend, credit to Debtor on the
condition, among others, that such credit be secured by a security
interest in certain assets of Debtor (the “Collateral”)
described in the Security Agreement attached hereto as
Exhibit A and incorporated herein by this reference
(the “Security Agreement”), and all or a portion of the
Collateral is now or may hereafter be located on that certain real
property owned by Landlord in Alamance County, North Carolina, as
more particularly described on Exhibit B attached
hereto and incorporated herein by this reference (the
“Property”); and
WHEREAS,
in extending or continuing to extend such credit to Debtor, Bank is
relying on the acknowledgments, representations and agreements
relating to the Collateral set forth herein.
NOW,
THEREFORE, Landlord, Debtor and Bank hereby acknowledge, represent
and agree as follows:
1.
Landlord’s Acknowledgment . Landlord acknowledges that
the security interest of Bank in the Collateral is senior and
superior to any claim or right in all or any portion thereof which
Landlord now has or may at any time hereafter acquire. Landlord
confirms that Landlord has not received notice from any person or
entity other than Bank of any claim of right, title or interest in
or to any of the Collateral.
2.
Notice and License . Landlord agrees to deliver to Bank, at
the same time as delivery to Debtor, a copy of any notice given by
Landlord to Debtor regarding any breach of, or limitation or
termination of, any lease or other agreement between Debtor and
Landlord relating to Debtor’s use and possession of the
Property. Subject to the terms and conditions of this Agreement,
Landlord and, where applicable, Debtor agree that notwithstanding
any failure by Debtor to perform under, or the termination of, any
lease or other agreement between Debtor and Landlord relating to
Debtor’s use and possession of the Property:
(a) Landlord will not dispose of the Collateral nor assert any
right or interest therein unless it has first notified Bank in
writing and has given Bank a reasonable opportunity to exercise
Bank’s rights in and to the Collateral; and (b) Bank is
hereby granted the right and license to enter upon the Property and
to possess and use the Property to take possession of the
Collateral and to exercise Bank’s rights, powers and remedies
with respect to the Collateral, including without limitation
completing any work in process, removing any or all of the
Collateral from the Property, a
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