|
Exhibit 10.5 EXHIBIT E SECURITY AGREEMENT
This SECURITY AGREEMENT, dated as of
December 30, 2008 (this " Agreement "), is among T3
Motion, Inc., a Delaware 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 10%
Secured Convertible Debentures due one year following their
issuance, in the original aggregate principal amount of $2,200,000
(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; WHEREAS, pursuant to
a certain Subsidiary Guarantee, dated as of the date hereof (the "
Guarantee "), the 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 (as defined in Section 18 hereof), a security
interest 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,
but not including any liabilities or obligations incurred pursuant
to that certain Securities Purchase Agreement, dated March 24, 2008
by and among the Company and the purchasers signatory thereto) 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 Interests "
shall have the meaning ascribed to such term in Section 4(j).
(h) " Pledged Securities "
shall have the meaning ascribed to such term in Section 4(i).
(i) " 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 (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 C 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 C 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 any 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 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 in
Section 4(p) hereof) 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 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 14
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 f
|
