This SECURITY
AGREEMENT, dated as of May 28, 2009 (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 $600,000 (collectively, the “ Debentures
”) signatory hereto, their endorsees, transferees and assigns
(collectively, the “ Secured Parties
”).
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 for such accounts and cooperate with
the Agent in taking any other steps required, in its judgment,
under the Fed
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