Exhibit
4.2
SECURITY AGREEMENT
THIS SECURITY
AGREEMENT (this
"Agreement") is made and entered into as of the 19th day of June,
2009, by and between AcXess, Inc., a Florida corporation
("AcXess"), and Innovative Software Technologies, Inc., a
California corporation ("Secured Party").
Recitals
WHEREAS , Pursuant to that certain Stock Purchase
Agreement dated July 24, 2007 among AcXess, Secured Party, Torn
Elowson, Ray Leitz, and Helge Solberg (the "Stock Purchase
Agreement"), AcXess has executed a Secured Promissory Note of even
date herewith in favor of Secured Party in the principal amount of
Five Hundred Thousand Dollars ($500,000) (the "Note").
WHEREAS , Secured Party has required, as a condition to
entering into the transactions contemplated by the Stock Purchase
Agreement, that AcXess grant Secured Party a first priority
security interest in all of AcXess's assets and property, and to
that end has required the execution and delivery of this Agreement
by AcXess.
NOW, THEREFORE
, in consideration of the mutual
covenants and agreements contained in the Note and herein, the
parties hereto, intending to be legally bound, agree as
follows:
1. Incorporation
of Recitals . Purchase Agreement, and Note. The foregoing
Recitals, the Note, and the Guarantee Agreement, and the terms and
provisions thereof, are hereby incorporated herein in their
entirety by this reference.
2. Definitions
. The following terms shall have the meanings set forth
below:
"Obligations" means each and every
debt, liability, and obligation of every type and description,
including without limitation any debt, liability, and obligation
arising under or in connection with the Note and Stock Purchase
Agreement, and the related documents entered into in connection
therewith, which AcXess may now or at any time hereafter owe to
Secured Party, whether such debt, liability, or obligation now
exists or is hereafter created or incurred and whether it is or may
be direct or indirect, due or to become due, absolute or
contingent, primary or secondary, liquidated or unliquidated,
independent, joint, several, or joint and several.
"Security Interest" has the meaning
given in Section 3.
"Collateral" means all assets and
personal and fixture property of any kind and nature whatsoever now
owned or hereafter acquired by AcXess, whether tangible or
intangible, including without limitation all of AcXess's right,
title, and interest in and to the property and assets listed on
Exhibit A, including all proceeds thereof and all increases,
substitutions, replacements, additions, and accretions
thereof.
3. Security
Interest . To secure payment of the Obligations, AcXess hereby
irrevocably pledges and assigns to, and grants Secured Party a
first priority security interest (the "Security Interest"). with
power of sale to the extent permitted by law, in the
Collateral.
4. Representations
and Warranties . AcXess represents and warrants as
follows:
(a) Authority .
AcXess has authority to enter into this Security Agreement and any
person signing it on AcXess's behalf has been duly authorized to
take such action.
(b) Financing
Statements . Except for the financing statements in favor of
Secured Party, and the financing statements in favor of Gulf Pointe
Capital, LLC, at the time of granting the security interest
described herein, no financing statement covering the Collateral or
any portion thereof will be on file in any public office and AcXess
agrees not to execute or authorize the filing of any such
additional financing statement in favor of any person, entity or
governmental agency (whether federal, state or local) other than
Secured Party as long as any portion of the Obligations evidenced
by the Note remain unpaid.
(c) Legal Name
. AcXess's exact legal name is as set forth in the first paragraph
of this Security Agreement. AcXess shall not change its legal name
or its form of organization without thirty (30) days' prior written
notice to Secured Party,
5. Covenants and
Agreements . AcXess covenants and agrees as follows:
(a) Restrictions
Future Agreements . AcXess agrees that until the Obligations
shall have been satisfied in full, AcXess shall not, without
Secured Party's prior written consent, assign, transfer or
otherwise dispose of the Collateral, and AcXess further agrees that
it will not take any action, or permit any action to be taken by
others subject to its control, including licensees, or fail to take
any action, which would affect the validity or enforcement of the
rights transferred to Secured Party under this
Agreement.
(b) Defense .
AcXess shall at its own expense and using commercially reasonable
efforts, protect and defend the Collateral against all claims or
demands,
(c) Maintenance
. AcXess shall at all times and at its own expense maintain and
keep, or cause to be maintained and kept, the Collateral in good
repair, working order, and condition; pay and discharge when due
all taxes, license fees, levies and other charges upon it; and not
permit it to be used in violation of any applicable law, regulation
or policy of insurance,
(d) Secured Party's
Right to Take Action . If AcXess fails to perform or observe
any of its covenants or agreements set forth in this Section 5, or
if AcXess notifies Secured Party that it intends to abandon any
part of the Collateral, Secured Party may (but need not) perform or
observe such covenant or agreement or take steps to prevent such
intended abandonment on behalf and in the name, place and stead of
AcXess (or, at Secured Party's option, in Secured Party's own name)
and may (but need not) take any and all other actions which Secured
Party may reasonably deem necessary to cure or correct such failure
or prevent such intended abandonment.
(e) Costs and
Expenses . Except to the extent that the effect of such payment
would be to render any loan or forbearance of money usurious or
otherwise illegal under any applicable law, AcXess shall pay
Secured Party on demand the amount of all moneys expended and all
costs and expenses (including reasonable attorneys' fees and
disbursements) incurred by Secured Party in connection with or as a
result of Secured Party's taking action under subsection 5(d) or
exercising its rights under Section 7, together with interest
thereon from the date expended or incurred by Secured
Party,
(f) Power of
Attorney . To facilitate Secured Party's taking action under
subsection 5(d) and exercising its rights under Section 7, AcXess
hereby irrevocably appoints (which appointment is coupled with an
interest) Secured Party, or its representatives or agents, as the
attorney-in-fact of AcXess with the right (but not the duty) from
time to time to create, prepare, complete, execute, deliver,
endorse, or file, in the name and on behalf of AcXess, any and all
instruments, documents, applications, financing statements, and
other agreements and writings required to be obtained, executed,
delivered or endorsed by AcXess under this Section 5, or,
reasonably necessary for Secured Party, after an Event of Default,
to lawfully enforce or use the Collateral, or to sell, assign,
transfer, pledge, encumber or otherwise transfer title in or
dispose of the Collateral to any third party. AcXess hereby
ratifies all that such attorney shall lawfully do or cause to be
done by virtue hereof. The power of attorney granted herein shall
terminate upon the payment in full and performance of all
Obligations,
6.
Events
