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SECURITY AGREEMENT
This
SECURITY AGREEMENT, dated as of May 30, 2008 (this
“
Agreement ”),
is among CryoPort,
Inc., a Nevada corporation
(the
“
Company ”),
all of the Subsidiaries of the Company (such
subsidiaries ,
the “
Guarantors ”
and
together with the Company ,
the “
Debtors ”)
and the holders of the Company’s Original Issue Discount 8%
Secured Convertible Debentures due December 1, 2010, and issued on
May 30, 2008 in the original aggregate principal amount of
$1,250,000
(collectively,
the “
Debentures ”)
signatory hereto, their endorsees, transferees and assigns
(collectively, the “
Secured Parties ”).
WITNESSETH:
WHEREAS,
pursuant to the Purchase Agreement (as defined in the
Debentures), the Secured Parties have severally agreed to
extend the loans to the Company evidenced by the
Debentures;
WHERAS,
pursuant to the Purchase Agreement, except for the September
Debentures (as defined in the Purchase Agreement), no
Indebtedness (as defined in the Purchase Agreement) or other
claim against the Company is senior to or pari passu with the
Debentures in right of payment, whether with respect to
interest or upon liquidation or dissolution, or otherwise,
other than indebtedness secured by purchase money security
interests (shich is senior only as to underlying assets
covered thereby) and capital lease obligations (which is
senior only as to the property covered thereby).
WHEREAS,
pursuant to a certain Subsidiary Guarantee, dated as of the
date hereof (the “
Guarantee ”),
th e
Guarantors
have
jointly and severally agreed to guarantee and act as surety for
payment of such Debentures; and
WHEREAS,
in order to induce the Secured Parties to extend the loans
evidenced by the Debentures, each Debtor has agreed to execute
and deliver to the Secured Parties this Agreement and to grant
the Secured Parties,
pari
passu with
each other Secured Party and through the Agent, a security interest
which is junior only to that interest of the holders of the
September Debentures in certain property of such Debtor to secure
the prompt payment, performance and discharge in full of all of the
Company’s obligations under the Debentures and the
Guarantors’ obligations under the Guarantee.
NOW,
THEREFORE, in consideration of the agreements herein contained
and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties
hereto hereby agree as follows:
1.
Certain Definitions .
As used in this Agreement, the following terms shall have the
meanings set forth in this Section 1. Terms used but not otherwise
defined in this Agreement that are defined in Article 9 of the UCC
(such as “account”, “chattel paper”,
“commercial tort claim”, “deposit account”,
“document”, “equipment”,
“fixtures”, “general intangibles”,
“goods”, “instruments”,
“inventory”, “investment property”,
“letter-of-credit rights”, “proceeds” and
“supporting obligations”) shall have the respective
meanings given such terms in Article 9 of the UCC.
(a)
“
Collateral ”
means the collateral in which the Secured Parties are granted a
security interest by this Agreement and which shall include the
following personal property of the Debtors, whether presently owned
or existing or hereafter acquired or coming into existence,
wherever situated, and all additions and accessions thereto and all
substitutions and replacements thereof, and all proceeds, products
and accounts thereof, including, without limitation, all proceeds
from the sale or transfer of the Collateral and of insurance
covering the same and of any tort claims in connection
therewith ,
and all dividends, interest, cash, notes, securities, equity
interest or other property at any time and from time to time
acquired, receivable or otherwise distributed in respect of, or in
exchange for, any or all of the Pledged Securities (as defined
below) :
(i)
All goods, including, without limitation, (A) all machinery,
equipment, computers, motor vehicles, trucks, tanks, boats,
ships, appliances, furniture, special and general tools,
fixtures, test and quality control devices and other equipment
of every kind and nature and wherever situated, together with
all documents of title and documents representing the same,
all additions and accessions thereto, replacements therefor,
all parts therefor, and all substitutes for any of the
foregoing and all other items used and useful in connection
with any Debtor’s businesses and all improvements
thereto; and (B) all inventory;
(ii)
All
contract rights and other general intangibles, including,
without limitation, all partnership interests, membership
interests, stock or other securities, rights
under any of the Organizational Documents, agreements related
to the Pledged Securities, licenses,
distribution and other agreements, computer software (whether
“off-the-shelf”, licensed from any third party or
developed by any Debtor), computer software development
rights, leases, franchises, customer lists, quality control
procedures, grants and rights, goodwill, trademarks, service
marks, trade styles, trade names, patents, patent
applications, copyrights, and income tax refunds;
(iii)
All
accounts, together with all instruments, all documents of
title representing any of the foregoing, all rights in any
merchandising, goods, equipment, motor vehicles and trucks
which any of the same may represent, and all right, title,
security and guaranties with respect to each account,
including any right of stoppage in transit;
(iv)
All
documents, letter-of-credit rights, instruments and chattel
paper;
(v)
All
commercial tort claims;
(vi)
All
deposit accounts and all cash (whether or not deposited in
such deposit accounts);
(vii)
All
investment property;
(viii)
All
supporting obligations; and
(ix)
All
files, records, books of account, business papers, and
computer programs; and
(x)
the
products and proceeds of all of the foregoing Collateral set
forth in clauses (i)-(ix) above.
Without
limiting the generality of the foregoing, the “
Collateral ”
shall include all investment property and general intangibles
respecting ownership and/or other equity interests in each
Guarantor, including, without limitation, the shares of capital
stock and the other equity interests listed on
Schedule H hereto
(as the same may be modified from time to time pursuant to the
terms hereof), and any other shares of capital stock and/or other
equity interests of any other direct or indirect subsidiary of any
Debtor obtained in the future, and, in each case, all certificates
representing such shares and/or equity interests and, in each case,
all rights, options, warrants, stock, other securities and/or
equity interests that may hereafter be received, receivable or
distributed in respect of, or exchanged for, any of the foregoing
and all rights arising under or in connection with the Pledged
Securities, including, but not limited to, all dividends, interest
and cash.
Notwithstanding
the foregoing, nothing herein shall be deemed to constitute an
assignment of any asset which, in the event of an assignment,
becomes void by operation of applicable law or the assignment
of which is otherwise prohibited by applicable law (in each
case to the extent that such applicable law is not overridden
by Sections 9-406, 9-407 and/or 9-408 of the UCC or other
similar applicable law);
provided ,
however ,
that to the extent permitted by applicable law, this Agreement
shall create a valid security interest in such asset and, to the
extent permitted by applicable law, this Agreement shall create a
valid security interest in the proceeds of such asset.
(b)
“
Intellectual Property ”
means the collective reference to all rights, priorities and
privileges relating to intellectual property, whether arising under
United States, multinational or foreign laws or otherwise,
including, without limitation, (i) all copyrights arising under the
laws of the United States, any other country or any political
subdivision thereof, whether registered or unregistered and whether
published or unpublished, all registrations and recordings thereof,
and all applications in connection therewith, including, without
limitation, all registrations, recordings and applications in the
United States Copyright Office, (ii) all letters patent of the
United States, any other country or any political subdivision
thereof, all reissues and extensions thereof, and all applications
for letters patent of the United States or any other country and
all divisions, continuations and continuations-in-part thereof,
(iii) all trademarks, trade names, corporate names, company names,
business names, fictitious business names, trade dress, service
marks, logos, domain names and other source or business
identifiers, and all goodwill associated therewith, now existing or
hereafter adopted or acquired, all registrations and recordings
thereof, and all applications in connection therewith, whether in
the United States Patent and Trademark Office or in any similar
office or agency of the United States, any State thereof or any
other country or any political subdivision thereof, or otherwise,
and all common law rights related thereto, (iv) all trade secrets
arising under the laws of the United States, any other country or
any political subdivision thereof, (v) all rights to obtain any
reissues, renewals or extensions of the foregoing, (vi) all
licenses for any of the foregoing, and (vii) all causes of action
for infringement of the foregoing.
(c)
“
Majority in Interest ”
means, at any time of determination, the majority in interest
(based on then-outstanding principal amounts of Debentures at the
time of such determination) of the Secured Parties.
(d)
“
Necessary Endorsement ”
means undated stock powers endorsed in blank or other proper
instruments of assignment duly executed and such other instruments
or documents as the Agent (as that term is defined below) may
reasonably request.
(
e
)
“
Obligations ”
means all of the liabilities
and obligations (primary, secondary, direct, contingent, sole,
joint or several) due or to become due, or that are now or may be
hereafter contracted or acquired, or owing to, of any Debtor to the
Secured Parties, including, without limitation, all
obligations
under this Agreement, the Debentures, the Guarantee and any other
instruments, agreements or other documents executed and/or
delivered in connection herewith or therewith, in each case,
whether now or hereafter existing, voluntary or involuntary, direct
or indirect, absolute or contingent, liquidated or unliquidated,
whether or not jointly owed with others, and whether or not from
time to time decreased or extinguished and later increased, created
or incurred, and all or any portion of such obligations or
liabilities that are paid, to the extent all or any part of such
payment is avoided or recovered directly or indirectly from any of
the Secured Parties as a preference, fraudulent transfer or
otherwise as such obligations may be amended, supplemented,
converted, extended or modified from time to time. Without limiting
the generality of the foregoing, the term “Obligations”
shall include, without limitation: (i) principal of, and interest
on the Debentures and the loans extended pursuant thereto; (ii) any
and all other fees, indemnities, costs, obligations and liabilities
of the Debtors from time to time under or in connection with this
Agreement, the Debentures, the Guarantee and any other instruments,
agreements or other documents executed and/or delivered in
connection herewith or therewith; and (iii) all amounts (including
but not limited to post-petition interest) in respect of the
foregoing that would be payable but for the fact that the
obligations to pay such amounts are unenforceable or not allowable
due to the existence of a bankruptcy, reorganization or similar
proceeding involving any Debtor.
(
f
)
“
Organizational Documents ”
means with respect to any Debtor, the documents by which such
Debtor was organized (such as a certificate of incorporation,
certificate of limited partnership or articles of organization, and
including, without limitation, any certificates of designation for
preferred stock or other forms of preferred equity) and which
relate to the internal governance of such Debtor (such as bylaws, a
partnership agreement or an operating, limited liability or members
agreement).
(
g
)
“
Pledged Securities ”
shall have the meaning ascribed to such term in Section
4(i).
(h)
“
UCC ”
means the Uniform Commercial Code of the State of New York and or
any other applicable law of any state or states which has
jurisdiction with respect to all, or any portion of, the Collateral
or this Agreement, from time to time. It is the intent of the
parties that defined terms in the UCC should be construed in their
broadest sense so that the term “Collateral” will be
construed in its broadest sense. Accordingly if there are, from
time to time, changes to defined terms in the UCC that broaden the
definitions, they are incorporated herein and if existing
definitions in the UCC are broader than the amended definitions,
the existing ones shall be controlling.
2.
Grant of Security Interest in Collateral
.
As an inducement for the Secured Parties to extend the loans as
evidenced by the Debentures and to secure the complete and timely
payment, performance and discharge in full, as the case may be, of
all of the Obligations, each Debtor hereby unconditionally and
irrevocably pledges, grants and hypothecates to the Secured Parties
a security interest in and to, a lien upon and a right of set-off
against all of their respective right, title and interest of
whatsoever kind and nature in and to, the Collateral, which
interest shall be subordinate to that of the holders of the
September Debentures (a “
Security Interest ”
and, collectively, the “
Security Interests ”).
3.
Delivery of Certain Collateral .
Contemporaneously or prior to the execution of this Agreement, each
Debtor shall deliver or cause to be delivered to the Agent (a) any
and all certificates and other instruments representing or
evidencing the Pledged Securities, and (b) any and all certificates
and other instruments or documents representing any of the other
Collateral, in each case, together with all Necessary Endorsements.
The Debtors are, contemporaneously with the execution hereof,
delivering to Agent, or have previously delivered to Agent, a true
and correct copy of each Organizational Document governing any of
the Pledged Securities.
4.
Representations, Warranties, Covenants and Agreements of the
Debtors .
Except as set forth under the corresponding section of the
disclosure schedules delivered to the Secured Parties concurrently
herewith (the “
Disclosure Schedules ”),
which Disclosure Schedules shall be deemed a part hereof, each
Debtor represents and warrants to, and covenants and agrees with,
the Secured Parties as follows:
(a)
Each Debtor has the requisite corporate, partnership, limited
liability company or other power and authority to enter into
this Agreement and otherwise to carry out its obligations
hereunder. The execution, delivery and performance by each
Debtor of this Agreement and the filings contemplated therein
have been duly authorized by all necessary action on the part
of such Debtor and no further action is required by such
Debtor. This Agreement has been duly executed by each Debtor.
This Agreement constitutes the legal, valid and binding
obligation of each Debtor, enforceable against each Debtor in
accordance with its terms except as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization
and similar laws of general application relating to or
affecting the rights and remedies of creditors and by general
principles of equity.
(b)
The
Debtors have no place of business or offices where their
respective books of account and records are kept (other than
temporarily at the offices of its attorneys or accountants) or
places where Collateral is stored or located, except as set
forth on
Schedule A attached
hereto. Except as specifically set forth on
Schedule A ,
each Debtor is the record owner of the real property where such
Collateral is located, and there exist no mortgages or other liens
on any such real property except for Permitted Liens (as defined in
the Debentures). Except as disclosed on
Schedule A ,
none of such Collateral is in the possession of any consignee,
bailee, warehouseman, agent or processor.
(c)
Except
for Permitted Liens (as defined in the Debentures) and except
as set forth on
Schedule B attached
hereto, the Debtors are the sole owner of the Collateral (except
for non-exclusive licenses granted by any Debtor in the ordinary
course of business), free and clear of any liens, security
interests, encumbrances, rights or claims, and are fully authorized
to grant the Security Interests. Except as set forth on
Schedule B attached
hereto, there is not on file in any governmental or regulatory
authority, agency or recording office an effective financing
statement, security agreement, license or transfer or any notice of
any of the foregoing (other than those that will be filed in favor
of the Secured Parties pursuant to this Agreement) covering or
affecting any of the Collateral. Except as set forth on
Schedule B attached
hereto and except pursuant to this Agreement, as long as this
Agreement shall be in effect, the Debtors shall not execute and
shall not knowingly permit to be on file in any such office or
agency any other financing statement or other document or
instrument (except to the extent filed or recorded in favor of the
Secured Parties pursuant to the terms of this
Agreement).
(d)
No
written claim has been received that any Collateral or
Debtor's use of any Collateral violates the rights of any
third party. There has been no adverse decision to any
Debtor's claim of ownership rights in or exclusive rights to
use the Collateral in any jurisdiction or to any Debtor's
right to keep and maintain such Collateral in full force and
effect, and there is no proceeding involving said rights
pending or, to the best knowledge of any Debtor, threatened
before any court, judicial body, administrative or regulatory
agency, arbitrator or other governmental
authority.
(e)
Each
Debtor shall at all times maintain its books of account and
records relating to the Collateral at its principal place of
business and its Collateral at the locations set forth
on
Schedule A attached
hereto and may not relocate such books of account and records or
tangible Collateral unless it delivers to the Secured Parties at
least 30 days prior to such relocation (i) written notice of such
relocation and the new location thereof (which must be within the
United States) and (ii) evidence that appropriate financing
statements under the UCC and other necessary documents have been
filed and recorded and other steps have been taken to perfect the
Security Interests to create in favor of the Secured Parties a
valid, perfected and continuing perfected first priority lien in
the Collateral.
(f)
This
Agreement creates in favor of the Secured Parties a valid
security interest in the Collateral, subject only to Permitted
Liens (as defined in the Debentures) securing the payment and
performance of the Obligations. Upon making the filings
described in the immediately following paragraph, all security
interests created hereunder in any Collateral which may be
perfected by filing Uniform Commercial Code financing
statements shall have been duly perfected. Except for the
filing of the Uniform Commercial Code financing statements
referred to in the immediately following paragraph, the
recordation of the Intellectual Property Security Agreement
(as defined below) with respect to copyrights and copyright
applications in the United States Copyright Office referred to
in paragraph (m), the
execution and delivery of deposit account control agreements
satisfying the requirements of Section 9-104(a)(2) of the UCC
with respect to each deposit account of the Debtors,
and
the delivery of the certificates and other instruments
provided in Section 3, no
action is necessary to create, perfect or protect the security
interests created hereunder. Without limiting the generality
of the foregoing, except for the filing of said financing
statements, the recordation of said Intellectual Property
Security Agreement, and the execution and delivery of said
deposit account control agreements, no consent of any third
parties and no authorization, approval or other action by, and
no notice to or filing with, any governmental authority or
regulatory body is required for (i) the execution, delivery
and performance of this Agreement, (ii) the creation or
perfection of the Security Interests created hereunder in the
Collateral or (iii) the enforcement of the rights of the Agent
and the Secured Parties hereunder.
(g)
Each
Debtor hereby authorizes the Agent to file one or more
financing statements under the UCC, with respect to the
Security Interests, with the proper filing and recording
agencies in any jurisdiction deemed proper by it.
(h)
The
execution, delivery and performance of this Agreement by the
Debtors does not (i) violate any of the provisions of any
Organizational Documents of any Debtor or any judgment,
decree, order or award of any court, governmental body or
arbitrator or any applicable law, rule or regulation
applicable to any Debtor or (ii) conflict with, or constitute
a default (or an event that with notice or lapse of time or
both would become a default) under, or give to others any
rights of termination, amendment, acceleration or cancellation
(with or without notice, lapse of time or both) of, any
agreement, credit facility, debt or other instrument
(evidencing any Debtor's debt or otherwise) or other
understanding to which any Debtor is a party or by which any
property or asset of any Debtor is bound or affected. If any,
all required consents (including, without limitation, from
stockholders or creditors of any Debtor) necessary for any
Debtor to enter into and perform its obligations hereunder
have been obtained.
(i)
The
capital stock and other equity interests listed on
Schedule H hereto
(the “
Pledged Securities ”)
represent all of the capital stock and other equity interests of
the Guarantors, and represent all capital stock and other equity
interests owned, directly or indirectly, by the Company. All of the
Pledged Securities are validly issued, fully paid and
nonassessable, and the Company is the legal and beneficial owner of
the Pledged Securities, free and clear of any lien, security
interest or other encumbrance except for the security interests
created by this Agreement and other Permitted Liens (as defined in
the Debentures).
(j)
The
ownership and other equity interests in partnerships and
limited liability companies (if any) included
in the Collateral (the
“
Pledged Interests ”)
by their express terms do not provide that they are securities
governed by Article 8 of the UCC and are not held in a securities
account or by any financial intermediary.
(k)
Except
for Permitted Liens (as defined in the Debentures), each
Debtor shall at all times maintain the liens and Security
Interests provided for hereunder as valid and perfected first
priority liens and security interests in the Collateral in
favor of the Secured Parties until this Agreement and the
Security Interest hereunder shall be terminated pursuant to
Section 11 hereof. Each Debtor hereby agrees to defend the
same against the claims of any and all persons and entities.
Each Debtor shall safeguard and protect all Collateral for the
account of the Secured Parties. At the request of the Agent,
each Debtor will sign and deliver to the Agent on behalf of
the Secured Parties at any time or from time to time one or
more financing statements pursuant to the UCC in form
reasonably satisfactory to the Agent and will pay the cost of
filing the same in all public offices wherever filing is, or
is deemed by the Agent to be, necessary or desirable to effect
the rights and obligations provided for herein. Without
limiting the generality of the foregoing, each Debtor shall
pay all fees, taxes and other amounts necessary to maintain
the Collateral and the Security Interests hereunder, and each
Debtor shall obtain and furnish to the Agent from time to
time, upon demand, such releases and/or subordinations of
claims and liens which may be required to maintain the
priority of the Security Interests hereunder.
(
l
)
No
Debtor will transfer, pledge, hypothecate, encumber, license,
sell or otherwise dispose of any of the Collateral (except for
non-exclusive licenses granted by a Debtor in its ordinary
course of business and sales of inventory by a Debtor in its
ordinary course of business) without the prior written consent
of a Majority
in Interest .
(
m
)
Each
Debtor shall keep and preserve its equipment, inventory and
other tangible Collateral in good condition, repair and order
and shall not operate or locate any such Collateral (or cause
to be operated or located) in any area excluded from insurance
coverage.
(
n)
Each
Debtor shall maintain with financially sound and reputable
insurers, insurance with respect to the Collateral, including
Collateral hereafter acquired, against loss or damage of the
kinds and in the amounts customarily insured against by
entities of established reputation having similar properties
similarly situated and in such amounts as are customarily
carried under similar circumstances by other such entities and
otherwise as is prudent for entities engaged in similar
businesses but in any event sufficient to cover the full
replacement cost thereof. Each Debtor shall cause each
insurance policy issued in connection herewith to provide, and
the insurer issuing such policy to certify to the Agent, that
(a) the Agent will be named as lender loss payee and
additional insured under each such insurance policy; (b) if
such insurance be proposed to be cancelled or materially
changed for any reason whatsoever, such insurer will promptly
notify the Agent and such cancellation or change shall not be
effective as to the Agent for at least thirty (30) days after
receipt by the Agent of such notice, unless the effect of such
change is to extend or increase coverage under the policy; and
(c) the Agent will have the right (but no obligation) at its
election to remedy any default in the payment of premiums
within thirty (30) days of notice from the insurer of such
default. If no Event of Default (as defined in the Debentures)
exists and if the proceeds arising out of any claim or series
of related claims do not exceed $100,000, loss payments in
each instance will be applied by the applicable Debtor to the
repair and/or replacement of property with respect to which
the loss was incurred to the extent reasonably feasible, and
any loss payments or the balance thereof remaining, to the
extent not so applied, shall be payable to the applicable
Debtor;
provided ,
however ,
that payments received by any Debtor after an Event of Default
occurs and is continuing or in excess of $100,000 for any
occurrence or series of related occurrences shall be paid to the
Agent on behalf of the Secured Parties and, if received by such
Debtor, shall be held in trust for the Secured Parties and
immediately paid over to the Agent unless otherwise directed in
writing by the Agent. Copies of such policies or the related
certificates, in each case, naming the Agent as lender loss payee
and additional insured shall be delivered to the Agent at least
annually and at the time any new policy of insurance is
issued.
(o)
Each
Debtor shall, within ten (10) days of obtaining knowledge
thereof, advise the Secured Parties promptly, in sufficient
detail, of any material adverse change in the Collateral, and
of the occurrence of any event which would have a material
adverse effect on the value of the Collateral or on the
Secured Parties’ security interest, through the Agent,
therein.
(
p
)
Each
Debtor shall promptly execute and deliver to the Agent such
further deeds, mortgages, assignments, security agreements,
financing statements or other instruments, documents,
certificates and assurances and take such further action as
the Agent may from time to time request and may in its sole
discretion deem necessary to perfect, protect or enforce the
Secured Parties’ security interest in the Collateral
including, without limitation, if applicable, the execution
and delivery of a separate security agreement with respect to
each Debtor’s Intellectual Property (“
Intellectual Property Security Agreement ”)
in which the Secured Parties have been granted a security interest
hereunder, substantially in a form reasonably acceptable to the
Agent, which Intellectual Property Security Agreement, other than
as stated therein, shall be subject to all of the terms and
conditions hereof.
(
q
)
Each
Debtor shall permit the Agent and its representatives and
agents to inspect the Collateral during normal business hours
and upon reasonable prior notice, and to make copies of
records pertaining to the Collateral as may be reasonably
requested by the Agent from time to time.
(
r
)
Each
Debtor shall take all steps reasonably necessary to diligently
pursue and seek to preserve, enforce and collect any rights,
claims, causes of action and accounts receivable in respect of
the Collateral.
(
s
)
Each
Debtor shall promptly notify the Secured Parties in sufficient
detail upon becoming aware of any attachment, garnishment,
execution or other legal process levied against any Collateral
and of any other information received by such Debtor that may
materially affect the value of the Collateral, the Security
Interest or the rights and remedies of the Secured Parties
hereunder.
(
t
)
All
information heretofore, herein or hereafter supplied to the
Secured Parties by or on behalf of any Debtor with respect to
the Collateral is accurate and complete in all material
respects as of the date furnished.
(
u
)
The
Debtors shall at all times preserve and keep in full force and
effect their respective valid existence and good standing and
any rights and franchises material to its
business.
(
v
)
No
Debtor will change its name, type of organization,
jurisdiction of organization, organizational identification
number (if it has one), legal or corporate structure, or
identity, or add any new fictitious name unless it provides at
least 30 days prior written notice to the Secured Parties of
such change and, at the time of such written notification,
such Debtor provides any financing statements or fixture
filings necessary to perfect and continue the perfection of
the Security Interests granted and evidenced by this
Agreement.
(
w
)
Except
in the ordinary course of business, no Debtor may consign any
of its inventory or sell any of its inventory on bill and
hold, sale or return, sale on approval, or other conditional
terms of sale without the consent of the
Agent which shall not be unreasonably withheld.
(
x
)
No
Debtor may relocate its chief executive office to a new
location without providing 30 days prior written notification
thereof to the Secured Parties and so long as, at the time of
such written notification, such Debtor provides any financing
statements or fixture filings necessary to perfect and
continue the perfection of the Security Interests granted and
evidenced by this Agreement.
(
y
)
Each
Debtor was organized and remains organized solely under the
laws of the state set forth next to such Debtor’s name
in
Schedule D attached
hereto, which
Schedule D sets
forth each Debtor’s organizational identification number or,
if any Debtor does not have one, states that one does not
exist.
(
z
)
(i)
The actual name of each Debtor is the name set forth in
Schedule D attached
hereto; (ii) no Debtor has any trade names except as set forth
on
Schedule E attached
hereto; (iii) no Debtor has used any name other than that stated in
the preamble hereto or as set forth on
Schedule E for
the preceding five years; and (iv) no entity has merged into any
Debtor or been acquired by any Debtor within the past five years
except as set forth on
Schedule E .
(
aa
)
At
any time and from time to time that any Collateral consists of
instruments, certificated securities or other items that
require or permit possession by the secured party to perfect
the security interest created hereby, the applicable Debtor
shall deliver such Collateral to the Agent.
(bb)
Each
Debtor, in its capacity as issuer, hereby agrees to comply
with any and all orders and instructions of Agent regarding
the Pledged Interests consistent with the terms of this
Agreement without the further consent of any Debtor as
contemplated by Section 8-106 (or any successor section) of
the UCC. Further, each Debtor agrees that it shall not enter
into a similar agreement (or one that would confer
“control” within the meaning of Article 8 of the
UCC) with any other person or entity.
(
cc
)
Each
Debtor shall cause all tangible chattel paper constituting
Collateral to be delivered to the Agent, or, if such delivery
is not possible, then to cause such tangible chattel paper to
contain a legend noting that it is subject to the security
interest created by this Agreement. To the extent that any
Collateral consists of electronic chattel paper, the
applicable Debtor shall cause the underlying chattel paper to
be “marked” within the meaning of Section 9-105 of
the UCC (or successor section thereto).
(
dd
)
If
there is any investment property or deposit account included
as Collateral that can be perfected by “control”
through an account control agreement, the applicable Debtor
shall cause such an account control agreement, in form and
substance in each case satisfactory to the Agent, to be
entered into and delivered to the Agent for the benefit of the
Secured Parties.
(
ee
)
To
the extent that any Collateral consists of letter-of-credit
rights, the applicable Debtor shall cause the issuer of each
underlying letter of credit to consent to an assignment of the
proceeds thereof to the Secured Parties.
(
ff
)
To
the extent that any Collateral is in the possession of any
third party, the applicable Debtor shall join with the Agent
in notifying such third party of the Secured Parties’
security interest in such Collateral and shall use its best
efforts to obtain an acknowledgement and agreement from such
third party with respect to the Collateral, in form and
substance reasonably satisfactory to the Agent.
(
gg
)
If
any Debtor shall at any time hold or acquire a commercial tort
claim, such Debtor shall promptly notify the Secured Parties
in a writing signed by such Debtor of the particulars thereof
and grant to the Secured Parties in such writing a security
interest therein and in the proceeds thereof, all upon the
terms of this Agreement, with such writing to be in form and
substance satisfactory to the Agent.
(
hh
)
Each
Debtor shall immediately provide written notice to the Secured
Parties of any and all accounts which arise out of contracts
with any governmental authority and, to the extent necessary
to perfect or continue the perfected status of the Security
Interests in such accounts and proceeds thereof, shall execute
and deliver to the Agent an assignment of claims for such
accounts and cooperate with the Agent in taking any other
steps required, in its judgment, under the Federal Assignment
of Claims Act or any similar federal, state or local statute
or rule to perfect or continue the perfected status of the
Security Interests in such accounts and proceeds
thereof.
(
ii
)
Each
Debtor shall cause each subsidiary
of
such Debtor to immediately become a party hereto (an
“
Additional Debtor ”),
by executing and delivering an Additional Debtor Joinder in
substantially the form of
Annex A attached
hereto and comply with the provisions hereof applicable to the
Debtors. Concurrent therewith, the Additional Debtor shall deliver
replacement schedules for, or supplements to all other Schedules to
(or referred to in) this Agreement, as applicable, which
replacement schedules shall supersede, or supplements shall modify,
the Schedules then in effect. The Additional Debtor shall also
deliver such opinions of counsel, aut
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