EXHIBIT C
TO
NOTE AND WARRANT PURCHASE AGREEMENT
SECURITY AGREEMENT
THIS SECURITY AGREEMENT (this "Security Agreement") is executed as
of
March 7, 2005, by MIRAVANT MEDICAL
TECHNOLOGIES, a Delaware corporation (the
"Company"), with headquarters located at
336 Bollay Drive, Santa Barbara,
California 93117, in favor of ST. CLOUD
INVESTMENTS, LTD., a British Virgin
Islands company (the "Secured Party").
RECITALS
A. The Company and the Secured Party have entered into a Note
and
Warrant Purchase Agreement, dated as of the
date hereof (the "Purchase
Agreement"), pursuant to which the Company
has agreed to issue to the Secured
Party, and the Secured Party has agreed to
purchase from the Company, on the
terms and conditions set forth therein,
Secured Convertible Promissory Notes
(each a "Note" and collectively, the
"Notes").
B.
In order to induce the Secured Party to extend the credit
evidenced
by the Notes, Company has agreed to enter
into this Security Agreement and to
grant to the Secured Party, the security
interest in the Collateral described
below.
AGREEMENT
NOW, THEREFORE, in consideration of the above recitals and for
other
good and valuable consideration, the
receipt and adequacy of which are hereby
acknowledged, the Company hereby agrees
with the Secured Party as follows:
1. Definitions and Interpretation. When
used in this Security Agreement, the
following terms have the following
respective meanings:
"Collateral" has the meaning given to that term in Section 2
hereof.
"Obligations" means the Notes, including, all interest, fees,
charges, expenses, attorneys' fees and
costs and accountants' fees and costs
chargeable to and payable by the Company
hereunder and thereunder, in each case,
whether direct or indirect, absolute or
contingent, due or to become due, and
whether or not arising after the
commencement of a proceeding under Title 11 of
the United States Code (11 U.S.C. Section
101 et seq.), as amended from time to
time (including post-petition interest) and
whether or not allowed or allowable
as a claim in any such proceeding.
"Permitted Liens" means (a) Liens for taxes not yet delinquent
or Liens for taxes being contested in good
faith and by appropriate proceedings
for which adequate reserves have been
established; (b) Liens in respect of
property or assets imposed by law which
were incurred in the ordinary course of
business, such as carriers',
warehousemen's, materialmen's and mechanics' Liens
and other similar Liens arising in the
ordinary course of business which are not
delinquent or remain payable without
penalty or which are being contested in
good faith and by appropriate proceedings;
(c) Liens incurred or deposits made
in the ordinary course of business in
connection with workers' compensation,
unemployment insurance and other types of
social security, and mechanic's Liens,
carrier's Liens and other Liens to secure
the performance of tenders, statutory
obligations, contract bids, government
contracts, performance and return of
money bonds and other similar obligations,
incurred in the ordinary course of
business, whether pursuant to statutory
requirements, common law or consenual
arrangements; (d) Liens in favor of the
Secured Party; (e) Liens upon any
equipment acquired or held by the Company
or any of its Subsidiaries to secure
the purchase price of such equipment or
indebtedness incurred solely for the
purpose of financing the acquisition of
such equipment, so long as such Lien
extends only to the equipment financed, and
any accessions, replacements,
substitutions and proceeds (including
insurance proceeds) thereof or thereto;
(f) Liens in favor of customs and revenue
authorities arising as a matter of law
to secure payments of customs duties in
connection with the importation of
goods, (g) Liens which constitute rights of
setoff of a customary nature or
banker's liens, whether arising by law or
by contract; (h) Liens on insurance
proceeds in favor of insurance companies
granted solely as security for financed
premiums; and (i) leases or subleases and
licenses or sublicenses granted in the
ordinary course of the Company's
business.
"UCC"
means the Uniform Commercial Code as in effect in the State of
California from time to time.
All capitalized terms not otherwise defined herein shall have
the
respective meanings given in the Notes.
Unless otherwise defined herein, all
terms defined in the UCC have the
respective meanings given to those terms in
the UCC.
2. Grant of Security Interest. As security
for the Obligations, the Company
hereby pledges to the Secured Party and
grants to the Secured Party a security
interest of first priority in all right,
title and interests of the Company in
and to the property described in Attachment
1 hereto, whether now existing or
hereafter from time to time acquired
(collectively, the "Collateral").
Notwithstanding the foregoing, the security
interest granted herein shall not
extend to and the term "Collateral" shall
not include any equipment or other
property financed by a third party,
provided that such third party's Liens are
Liens of the type described in subsection
(e) of the definition of Permitted
Liens 3. General Representations and
Warranties. The Company represents and
warrants to the Secured Party that (a) the
Company is the owner of the
Collateral (or, in the case of
after-acquired Collateral, at the time the
Company acquires rights in the Collateral,
will be the owner thereof) and that
no other Person has (or, in the case of
after-acquired Collateral, at the time
the Company acquires rights therein, will
have) any right, title, claim or
interest (by way of Lien or otherwise) in,
against or to the Collateral, other
than Permitted Liens; (b) upon the filing
of UCC-1 financing statements in the
appropriate filing offices and patent
assignments with the U.S. Patent and
Trademark Office, the Secured Party has (or
in the case of after-acquired
Collateral, at the time the Company
acquires rights therein, will have) a first
priority perfected security interest in the
Collateral to the extent that a
security interest in the Collateral can be
perfected by such filing, except for
Permitted Liens; (c) all accounts
receivable and payment intangibles are genuine
and enforceable against the party obligated
to pay the same; (d) the originals
of all documents evidencing all accounts
receivable and payment intangibles of
the Company and the only original books of
account and records of the Company
relating thereto are, and will continue to
be, kept at the address of the
Company set forth in Section 7 of this
Security Agreement.
4. Covenants Relating to Collateral. The
Company hereby agrees (a) to perform
all acts that may be necessary to maintain,
preserve, protect and perfect the
Collateral, the Lien granted to the Secured
Party therein and the perfection and
priority of such Lien, except for Permitted
Liens; (b) not to use or permit any
Collateral to be used (i) in violation in
any material respect of any applicable
law, rule or regulation, or (ii) in
violation of any policy of insurance
covering the Collateral; (c) to pay
promptly when due all taxes and other
governmental charges, all Liens and all
other charges now or hereafter imposed
upon or affecting any Collateral; (d)
without 30 days' written notice to the
Secured Party, (i) not to change the
Company's name or place of business (or, if
the Company has more than one place of
business, its chief executive office), or
the office in which the Company's records
relating to accounts receivable and
payment intangibles are kept, and (ii) not
to change the Company's state of
incorporation; and (f) to procure, execute
and deliver from time to time any
endorsements, assignments, financing
statements and other writings reasonably
deemed necessary or appropriate by the
Secured Party to perfect, maintain and
protect its Lien hereunder and the priority
thereof and to deliver promptly upon
the request of the Secured Party all
originals of Collateral consisting of
instruments. 5. Authorized Action by the
Secured Party. The Company hereby
irrevocably appoints the Secured Party as
its attorney-in-fact (which
appointment is coupled with an interest)
and agrees that the Secured Party may
perform (but the Secured Party shall not be
obligated to and shall incur no
liability to the Company or any third party
for failure so to do) any act which
the Company is obligated by this Security
Agreement to perform, and to exercise
such rights and powers as the Company might
exercise with respect to the
Collateral, including the right to (a)
collect by legal proceedings or otherwise
and endorse, receive and receipt for all
dividends, interest, payments, proceeds
and other sums and property now or
hereafter payable on or on account of the
Collateral; (b) enter into any extension,
reorganization, deposit, merger,
consolidation or other agreement pertaining
to, or deposit, surrender, accept,
hold or apply other property in exchange
for the Collateral; (c) make any
compromise or settlement, and take any
action it deems advisable, with respect
to the Collateral; (d) insure, process and
preserve the Collateral; (e) pay any
indebtedness of the Company relating to the
Collateral; and (f) file UCC
financing statements in the appropriate
jurisdictions and patent assignments
with the U.S. Patent and Trademark Office
and execute other documents,
instruments and agreements required
hereunder; provided, however, that the
Secured Party shall not exercise any such
powers granted pursua
