EXHIBIT 10.5
SECURITY AGREEMENT
THIS SECURITY AGREEMENT is executed effective
the 26th day of March, 2008, by APOTHECARYRX, LLC, an Oklahoma
limited liability company (the “Borrower”), in favor of
NEWT’S DISCOUNT PHARMACY, INC., an Oklahoma corporation (the
“Lender”).
W I T N
E S S E T H:
WHEREAS, the Borrower is liable to the Lender
under that certain Promissory Note of even date herewith in the
original face amount of Four Hundred Thousand Dollars ($400,000)
(the “Note”);
NOW, THEREFORE, for and in consideration of the
premises and the agreements herein contained and for other good and
valuable consideration, the receipt and sufficiency of all of which
are hereby acknowledged, the Borrower hereby agrees with the Lender
as follows:
1.
Security Interest . As collateral security for the
Secured Indebtedness (as hereafter defined), the Borrower hereby
grants to the Lender a security interest in the following property
used in connection with the Borrower’s retail pharmacy
located at 1900 N. Classen Blvd., Oklahoma City, OK
73106 102 West Noble, Guthrie, Ok 73044 (collectively, the
“Property”): (a) the furniture, fixtures,
equipment, computer hardware and software and other articles of
tangible personal property acquired by the Borrower under that
certain Pharmacy Purchase Agreement dated March 24, 2008,
among the Borrower, the Lender and affiliates of the Lender (the
“Purchase Agreement”); (b) the intangible personal
property acquired under the Purchase Agreement, including,
without limitation, names (including the name “Professional
Discount Pharmacy” and “Pendergraft Drugs”),
telephone numbers, pager numbers, cellular and digital phone
numbers, internet web sites, electronic mail addresses, customer
and prospective customer lists, books, records, files and computer
software; (c) the Borrower’s interest under the lease
agreements for the land and improvements where the pharmacy is
located; and (d) customer files and customer records whether
paper files, computer data or EMR.
2.
Secured Indebtedness . The security interest granted
hereby in the Property is given to secure the Borrower’s
payment of (the “Secured Indebtedness”):
(a) the Note together with interest thereon; and
(b) the obligations of the Borrower to the Lender under this
Agreement.
3.
Borrower’s Representations and Covenants . The
Borrower hereby warrants, represents and agrees as
follows:
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3.1.
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Location . The Borrower is a limited
liability company duly formed and in good standing in the State of
Oklahoma.
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3.2.
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Title . The Borrower has absolute
title to the Property free and clear of all liens, encumbrances and
security interests except for the security interest hereby granted
to the Lender, and the Borrower warrants and will defend the same
unto the Lender against the claims and demands of all persons and
parties whomsoever.
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