Exhibit 10.4

 

SECURITY AGREEMENT

 

THIS SECURITY AGREEMENT (as amended, restated, supplemented or otherwise
modified from time to time, this “Agreement”), is made by and among Pacific
Ethanol, Inc., a Delaware corporation (the “Company”), each Holder (as defined
below) (each, a “Secured Party” and collectively, the “Secured Parties”) and
Cortland Capital Market Services LLC, as collateral agent for itself and the
Secured Parties (in such capacity, together with its successors and permitted
assigns in such capacity, the “Agent”), effective as of December 15, 2016.

 

R E C I T A L S :

 

A.       The Company and each Holder are parties to a Note Purchase Agreement
dated as of the date hereof (as amended, restated, supplemented or otherwise
modified from time to time, including amendments and restatements thereof in its
entirety, the “Purchase Agreement”), pursuant to which the Company will issue or
has issued, and the Holders will purchase or have purchased on a several basis,
up to $55,000,000 in aggregate principal amount of senior secured notes due
December 15, 2019 (as amended, restated, supplemented or otherwise modified from
time to time, the “Notes”).

 

B.       The Notes shall be secured by a first-priority security interest in all
of the Company’s equity interest in PE OP CO., a Delaware corporation (the
“Issuer”).

 

C.       The Company owns one hundred percent of the issued and outstanding
shares of common stock, $0.001 par value per share, of the Issuer as set forth
on Schedule I attached hereto opposite the Company’s name, as such Schedule I
may be updated or modified from time to time.

 

D.       As a condition to entering into the Purchase Agreement with the
Company, the Holders have required, among other things, that the Company shall
have made the pledge and hypothecation contemplated by this Agreement.

 

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 “control”, “investment property”, “proceeds” and “records”) shall
have the respective meanings given such terms in Article 9 of the UCC.
Capitalized terms used but not otherwise defined in this Agreement shall have
the meanings ascribed to them in the Purchase Agreement (including in the form
of Note attached thereto as Exhibit B).

 

(a)               “Agent Fee Letter” means that certain Agent Fee Letter, dated
as of December 15, 2016, made by and between the Company and the Agent, as
amended, restated, supplemented or otherwise modified from time to time.

 

(b)               “Collateral” means the Pledged Collateral.

 

(c)               “Holders” means (x) each Person that is (i) a signatory to the
Purchase Agreement and identified as an “Investor” on Exhibit A to the Purchase
Agreement, (ii) a holder of a Note and (iii) a signatory to this Agreement and
identified as a “Secured Party” on the signature pages to this Agreement, and
(y) any other Person that becomes (i) a holder of a Note pursuant to any
permitted assignment or transfer and (ii) a “Secured Party” under this Agreement
pursuant to a Security Agreement Joinder, other than any such Person that ceases
to be a party hereto pursuant to an assignment of all of its Notes and its
rights and obligations under the Transaction Documents.

 

 

 

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(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 or the Required Holders 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 the Company to the Agent or to the Secured Parties, including, without
limitation, all obligations under this Agreement, the Purchase Agreement, the
Notes, the Agent Fee Letter 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 Agent or 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) the principal amount of,
and interest on the Notes and the loans extended pursuant thereto; (ii) any and
all other fees, indemnities, costs, obligations and liabilities of the Company
from time to time under or in connection with this Agreement, the Purchase
Agreement, the Notes, the Agent Fee Letter 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
the Company.

 

(f)                “Organizational Documents” means the Company’s certificate of
incorporation and bylaws.

 

(g)               “Pledged Collateral” shall have the meaning ascribed to such
term in Section 2(d).

 

(h)               “Pledged Shares” shall have the meaning ascribed to such term
in Section 2(a).

 

(i)                 “Security Agreement Joinder” means an agreement
substantially in the form of Exhibit 1 hereto.

 

(j)                 “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.

 

The use in this Agreement of the word “include” or “including,” when following
any general statement, term or matter, will not be construed to limit such
statement, term or matter to the specific items or matters set forth immediately
following such word or to similar items or matters, whether or not nonlimiting
language (such as “without limitation” or “but not limited to” or words of
similar import) is used with reference thereto, but will be deemed to refer to
all other items or matters that fall within the broadest possible scope of such
general statement, term or matter. The word “will” shall be construed to have
the same meaning and effect as the word “shall.” Terms used in this Agreement in
the singular have the same meaning in the plural, and vice-versa.

 

 

 

 

 

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2.                  Pledge. As collateral security for the Obligations, the
Company hereby pledges, collaterally assigns and hypothecates to the Agent on
behalf of itself and the Secured Parties, and grants to the Agent, for the
benefit of the Agent and the Secured Parties, a lien on and security interest
in:

 

(a)               the equity interests of the Issuer identified on Schedule I
hereto (as may be updated or modified from time to time in accordance herewith)
as being pledged that are held by the Company, including all securities
convertible into, and rights, warrants, options and other rights to purchase or
otherwise acquire, any of the foregoing (the “Pledged Shares”) and the
certificates representing the Pledged Shares, any interest of the Company in the
entries on the books of any securities intermediary pertaining thereto and all
equity dividends and cash dividends, cash, instruments, chattel paper and other
rights, property or proceeds and products from time to time received, receivable
or otherwise distributed in respect of or in exchange for any or all of the
Pledged Shares;

 

(b)               all additional equity interests of the Issuer at any time
acquired by the Company in any manner, and the certificates representing such
additional equity interests (and any such additional equity interests shall
constitute part of the Pledged Shares under this Agreement), and all equity
dividends, cash dividends, distributions, cash, instruments, chattel paper and
other rights, property or proceeds and products from time to time received,
receivable or otherwise distributed in respect of or in exchange for any or all
of such shares;

 

(c)               all Records (as defined in the UCC), including supporting
evidence and documents relating to any of the above-described property,
including, without limitation, all books of account, ledgers, and cabinets in
which the same are reflected or maintained; and

 

(d)               all proceeds of any of the foregoing (the assets described in
this Section 2, are collectively referred to as, the “Pledged Collateral”).

 

3.                  Security for Obligations. This Agreement and all of the
Pledged Collateral secure the prompt payment and performance when due of any and
all Obligations, in each case whether now existing or hereafter arising (and
whether arising before or after the filing of a petition in bankruptcy and
including all interest accrued after the petition date), due or to become due,
direct or indirect, absolute or contingent, and howsoever evidenced, held or
acquired.

 

4.                  Delivery of Pledged Collateral. All certificates or
instruments that constitute “certificated securities” pursuant to Article 8 of
the UCC that represent or evidence any of the Pledged Collateral shall be
delivered to and held by or on behalf of the Agent pursuant hereto and shall be
in suitable form for transfer by delivery, or shall be accompanied by Necessary
Endorsements in form and substance reasonably satisfactory to the Agent and the
Required Holders. The Agent shall have the right upon the occurrence and during
the continuance of an Event of Default, with concurrent written notice to the
Company, at any time in its sole discretion to transfer to or to register in the
name of the Agent or any of its nominees any or all of the Pledged Collateral in
order to exercise its rights and remedies hereunder. In addition, the Agent
shall have the right to exchange certificates or instruments representing or
evidencing any Pledged Collateral for certificates or instruments of smaller or
larger denominations.

 

 

 

 

 

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5.                  Effectiveness. This Agreement will become effective upon the
date on which the Agent has received (a) a counterpart hereof duly executed by
each of the parties hereto, (b) a copy of the Agent Fee Letter duly executed by
each of the parties thereto, (c) a copy of the Note Purchase Agreement duly
executed by each of the parties thereto, and (d) payment from the Company of (i)
all fees required to be paid on or prior to the effective date of this Agreement
pursuant to the Agent Fee Letter and (ii) all reasonable third-party fees and
expenses incurred by the Agent in connection with this Agreement and the
transactions contemplated hereby, including, without limitation, attorneys’ fees
and expenses.

 

6.                  Representations and Warranties; Covenants. In order to
induce the Agent and the Holders to enter into this Agreement and for the
Holders to purchase the Notes under the Purchase Agreement, the Company
represents and warrants that the following statements are true, correct and
complete on the Closing Date (except to the extent such representation or
warranty relates to an earlier date, in which case, it is true, correct and
complete as of such earlier date) as follows and agrees as follows:

 

(a)               Schedule I hereto completely and accurately sets forth the
number of equity interests of, and options or other rights to purchase or
receive, the issued and outstanding equity interests of the Issuer held by the
Company as of the date hereof and indicates which such equity interests
constitute Pledged Shares. The Pledged Shares held by the Company constitute, as
of the date hereof, the percentage of the issued and outstanding equity
interests of the Issuer set forth on Schedule I. All of such Pledged Shares
owned by the Company are owned legally and beneficially by the Company and have
been duly authorized and validly issued and are fully paid and nonassessable.
Except as set forth on Schedule I, there are no outstanding warrants, options,
subscriptions or other contractual arrangements for the purchase of any other
equity interests or any securities convertible into equity interests of any
Issuer, and there are no preemptive rights with respect to the equity interests
of the Issuer that constitute Pledged Shares of the Issuer and the Pledged
Shares are free and clear of all Liens.

 

(b)               The Company has the requisite corporate power and authority to
enter into this Agreement and otherwise to carry out its obligations hereunder.
The execution, delivery and performance by the Company of this Agreement and the
filings contemplated herein have been duly authorized by all necessary action on
the part of the Company and no further action is required by the Company. This
Agreement has been duly executed by the Company. This Agreement constitutes the
legal, valid and binding obligation of the Company, enforceable against the
Company 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.

 

(c)               The execution, delivery and performance of this Agreement by
the Company does not (i) violate any of the provisions of any Organizational
Documents of the Company or any judgment, decree, order or award of any court,
governmental body or arbitrator or any applicable law, rule or regulation
applicable to the Company 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 the Company’s debt or
otherwise) or other understanding to which the Company is a party or by which
any property or asset of the Company is bound or affected. If any, all required
consents (including, without limitation, from stockholders or creditors of the
Company) necessary for the Company to enter into and perform its obligations
hereunder have been obtained.

 

(d)               The Company hereby agrees to comply with any and all orders
and instructions of the Agent regarding the Pledged Shares consistent with the
terms of this Agreement without the further consent of the Company as
contemplated by Section 8-106 (or any successor section) of the UCC. Further,
the Company 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.

 

 

 

 

 

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(e)               The Company shall vote the Pledged Shares to comply with the
covenants and agreements set forth herein, the Purchase Agreement and in the
Notes.

 

(f)                The Company shall register the pledge of the applicable
Pledged Shares on the books of the Company. Further, except with respect to
certificated securities delivered to the Agent, the Company shall deliver to the
Agent an acknowledgement of pledge (which, where appropriate, shall comply with
the requirements of the relevant UCC with respect to perfection by registration
and shall be in form and substance reasonably satisfactory to the Required
Holders) signed by the Issuer, which acknowledgement shall confirm that: (a) it
has registered the pledge on its books and records; (b) it agrees to comply with
any and all orders and instructions of the Agent regarding the Pledged Shares
without the further consent of the Company as contemplated by Section 8-106 (or
any successor section) of the UCC; (c) at any time directed by the Agent during
the continuation of an Event of Default, the Issuer will transfer the record
ownership of such Pledged Shares into the name of any designee of the Agent,
will take such steps as may be necessary to effect the transfer, and will comply
with all other instructions of the Agent without the further consent of the
Company.

 

(g)               In the event that, upon an occurrence of an Event of Default,
the Agent (at the written direction of the Required Holders) shall sell all or
any of the Pledged Shares to another party or parties (herein called the
“Transferee”) or shall purchase or retain all or any of the Pledged Shares, the
Company shall, to the extent applicable: (i) deliver to the Agent or the
Transferee, as the case may be, the certificate of incorporation, bylaws, minute
books, stock certificate books, corporate seals, deeds, leases, indentures,
agreements, evidences of indebtedness, books of account, financial records and
all other Organizational Documents and records of the Issuer and its direct and
indirect subsidiaries; (ii) use its best efforts to obtain resignations of the
persons then serving as officers and directors of the Issuer and its direct and
indirect subsidiaries, if so directed by the Agent; and (iii) use its best
efforts to obtain any approvals that are required by any governmental or
regulatory body in order to permit the sale of the Pledged Shares to the
Transferee or the purchase or retention of the Pledged Shares by the Agent and
allow the Transferee or the Agent to continue the business of the Issuer and its
direct and indirect subsidiaries.

 

(h)               The Company’s type of organization, jurisdiction of
organization, legal name, Federal Taxpayer Identification Number, organizational
identification number (if any) and chief executive office or principal place of
business all as in effect on the date hereof, are indicated in Schedule I
hereof. Schedule I also lists the Company’s jurisdiction and type of
organization, legal name and location of chief executive office or principal
place of business at any time during the four months preceding the date hereof,
if different from those referred to in the preceding sentence.

 

(i)                 The Company hereby irrevocably authorizes the Agent (and its
designees) at any time and from time to time to file any financing statements
and amendments thereto relating to the Collateral without the signature of such
Grantor where permitted by law in such form and in such jurisdictions as the
Agent or Required Holders reasonably determine appropriate to perfect the
security interests of the Agent under this Agreement. The Company agrees to
provide all necessary information related to such filings to the Agent promptly
upon request by the Agent or the Required Holders.

 

(j)                 The Company shall take such further actions, and execute
and/or deliver to the Agent such additional financing statements, amendments,
assignments, agreements, supplements, powers and instruments, and will obtain
such governmental consents and corporate approvals and will cause to be done all
such other things as the Agent or the Required Holders may in its or their
judgment deem necessary or appropriate in order to create and/or maintain the
validity, perfection or priority of and protect any security interest granted or
purported to be granted in the Collateral as provided herein and the rights and
interests granted to the Agent hereunder, and enable the Agent to exercise and
enforce its rights, powers and remedies hereunder with respect to any
Collateral, including the filing of any financing statements, continuation
statements and other documents under the UCC (or other similar laws) in effect
in any jurisdiction with respect to the security interest created hereby, all in
form satisfactory to the Agent and the Required Holders and in such offices
wherever required by law to perfect, continue and maintain the validity,
enforceability and priority of the security interest in the Collateral as
provided herein and to preserve the other rights and interests granted to the
Agent hereunder, as against third parties, with respect to the Collateral.

 

 

 

 

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(k)               The Company shall, except upon not less than 10 days’ prior
written notice to the Agent, and delivery to the Agent of all additional
financing statements, information and other documents reasonably requested by
the Agent or the Required Holders to maintain the validity, perfection and
priority of the security interests provided for herein: (i) change its legal
name, identity, type of organization or corporate structure; (ii) change the
location of its chief executive office or its principal place of business; (iii)
change its Federal Taxpayer Identification Number or organizational
identification number (if any); or (iv) change its jurisdiction of organization
(in each case, including by merging with or into any other entity, reorganizing,
organizing, dissolving, liquidating, reincorporating or incorporating in any
other jurisdiction).

 

7.                  Defaults. The following events shall be “Events of Default”:

 

(a)               the occurrence of an Event of Default (as that term is defined
in the Notes) under the Notes;

 

(b)               the Company’s failure to pay to the Agent any amounts when and
as due under this Agreement or the Agent Fee Letter, if such failure remains
uncured for a period of at least five (5) days;

 

(c)               any representation or warranty of the Company in this
Agreement shall prove to have been incorrect in any material respect when made;

 

(d)               except as otherwise provided in Section 7(e), the failure by
the Company to observe or perform any of its obligations hereunder for ten (10)
days after delivery to the Company of notice of such failure by or on behalf of
the Agent or a Secured Party unless such default is capable of cure but cannot
be cured within such time frame and the Company is using best efforts to cure
the same in a timely fashion; or

 

(e)               if any provision of this Agreement shall at any time for any
reason be declared to be null and void, or the validity or enforceability
thereof shall be contested by the Company, or a proceeding shall be commenced by
the Company, or by any governmental authority having jurisdiction over the
Company, seeking to establish the invalidity or unenforceability thereof, or the
Company shall deny that the Company has any liability or obligation purported to
be created under this Agreement.

 

8.                  Duty To Hold In Trust. If the Company shall become entitled
to receive or shall receive any securities or other property (including, without
limitation, shares of Pledged Shares or instruments representing Pledged Shares
acquired after the date hereof, or any options, warrants, rights or other
similar property or certificates representing a dividend, or any distribution in
connection with any recapitalization, reclassification or increase or reduction
of capital, or issued in connection with any reorganization of the Company or
any of its direct or indirect subsidiaries) in respect of the Pledged Shares
(whether as an addition to, in substitution of, or in exchange for, such Pledged
Shares or otherwise), the Company agrees to (i) accept the same as the agent of
the Agent and the Secured Parties; (ii) hold the same in trust on behalf of and
for the benefit of the Agent and the Secured Parties; and (iii) to deliver any
and all certificates or instruments evidencing the same to the Agent on or
before the close of business on the fifth (5th) Business Day following the
receipt thereof by the Company, in the exact form received together with the
Necessary Endorsements, to be held by the Agent subject to the terms of this
Agreement as Collateral.

 

 

 

 

 

 

 

 

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9.                  Rights and Remedies Upon Default.

 

(a)               Upon the occurrence of any Event of Default and at any time
thereafter, the Agent and the Secured Parties, acting through the Agent by
written direction to the Agent, shall have the right to exercise all of the
remedies conferred hereunder and under the Notes, and the Agent and the Secured
Parties shall have all the rights and remedies of a secured party under the UCC.
Without limitation, the Agent, for the benefit of itself and the Secured
Parties, shall have the rights and powers listed below and shall act in
accordance with such rights and powers:

 

(i)                 All rights of the Company to exercise the voting and other
consensual rights with respect to the Pledged Collateral it would otherwise be
entitled to exercise shall immediately cease, and all such rights shall
thereupon become vested in the Agent, which shall have the sole right to
exercise such voting and other consensual rights.

 

(ii)              All rights of the Company to receive dividends, distributions
or other proceeds of the Pledged Collateral which it would otherwise be
authorized to receive and retain shall immediately cease and all such rights
shall thereupon become vested in the Agent, which shall have the sole right to
receive and hold such dividends, distributions or other proceeds as Pledged
Collateral.

 

(iii)            The Agent may, without notice except as specified herein, sell
all of the Pledged Collateral pledged by the Company or any part thereof in one
or more parcels at public or private sale, at any exchange, broker's board or at
any of the Agent's offices or elsewhere, for cash, on credit, or for future
delivery, at such price or prices and upon such other terms as Agent deems
commercially reasonable. The Company acknowledges and agrees that such a private
sale may result in prices and other terms which may be less favorable to the
seller than if such sale were a public sale. The Company agrees that, to the
extent notice of sale shall be required by law, at least ten (10) days’ notice
to the Company of the time and place of any public sale or the time after which
any private sale is to be made shall constitute reasonable notification. At any
sale of any of the Pledged Collateral, if permitted by law, the Agent (if so
directed by the Required Holders in writing) and any Secured Party may bid
(which bid may be, in whole or in part, in the form of cancellation of
indebtedness) for the purchase of such Pledged Collateral or any portion
thereof. The Agent shall not be obligated to make any sale of Pledged Collateral
regardless of notice of sale having been given. The Agent may adjourn any public
or private sale from time to time by announcement at the time and place fixed
therefor, and such sale may, without further notice, be made at the time and
place to which it was so adjourned. The Agent shall be under no obligation to
delay a sale of any of the Pledged Collateral for the period of time necessary
to permit the issuing corporation of such securities to register such securities
for public sale under the Securities Act of 1933, as amended (the “Securities
Act”), or under applicable state securities laws (collectively, the “Securities
Laws”), even if the Issuer would agree to do so. To the extent permitted by law,
the Company hereby specifically waives all rights of redemption, stay or
appraisal which such Pledgor has or may have under any law now existing or
hereafter enacted; provided, however, that the foregoing waiver shall inure to
the benefit of only the Agent and the Secured Parties and their respective
successors and permitted assigns.

 

(iv)             All cash proceeds received by the Agent in respect of any sale
of, collection from, or other realization upon all or any part of the Pledged
Collateral shall be applied to the Obligations, in each case, in accordance with
the terms hereof.

 

 

 

 

 

 

 

 

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(v)               Each Pledgor recognizes that the Agent may be unable to effect
a public sale of all or part of the Pledged Collateral and may be compelled to
resort to one or more private sales to a restricted group of purchasers who will
be obligated to agree, among other things, to acquire such Pledged Collateral
for their own account, for investment and not with a view to the distribution or
resale thereof. Each Pledgor acknowledges that any such private sales may be at
prices and on terms less favorable to the seller than if sold at public sales
and agrees that such private sales shall be deemed to have been made in a
commercially reasonable manner, and that Agent has no obligation to delay sale
of any such Pledged Collateral for the period of time necessary to permit the
issuer of such Pledged Collateral to register such Pledged Collateral for public
sale under the Securities Act or under applicable state securities laws.

 

(b)               The Agent shall comply with any applicable law in connection
with a disposition of Collateral and such compliance will not be considered
adversely to affect the commercial reasonableness of any sale of the Collateral.
The Agent may sell the Collateral without giving any warranties and may
specifically disclaim such warranties. If the Agent sells any of the Collateral
on credit, the Company will only be credited with payments actually made by the
purchaser and received by the Agent or party acting on behalf of the Agent. In
addition, the Company waives any and all rights that it may have to a judicial
hearing in advance of the enforcement of any of the Agent’s rights and remedies
hereunder, including, without limitation, its right following an Event of
Default to take immediate possession of the Collateral and to exercise its
rights and remedies with respect thereto.

 

10.              Applications of Proceeds.

 

(a)               The Agent shall apply the proceeds of any sale, collection,
foreclosure, disposition or other realization of the Collateral hereunder in the
following order of application:

 

(i)                 first, to the payment of all amounts payable under this
Agreement and the Agent Fee Letter on account of the Agent’s fees and any fees,
costs and expenses (including, without limitation, any taxes, fees and other
costs incurred in connection with the transactions contemplated hereunder and
reasonable fees and expenses of legal counsel to the Agent) or other liabilities
of any kind incurred by the Agent or any custodian, agent or sub-agent of the
Agent in connection with this Agreement or any other Transaction Document or the
Agent performing its obligations hereunder or thereunder or the transactions
contemplated hereunder;

 

(ii)              second, to satisfaction of the Obligations pro rata among the
Secured Parties (as the Agent is directed in writing by all Secured Parties,
which written direction shall be based on then-outstanding principal amounts of
the Notes at the time of any such determination);

 

(iii)            third, to the payment of any other amounts required by
applicable law; and

 

(iv)             fourth, to the Company any surplus proceeds.

 

(b)               In the event that there are any proceeds from any sale,
collection, foreclosure, disposition or other realization upon any Pledged
Collateral remaining after application in accordance with Section 10(a)(i)
above, each of the Secured Parties and the Company hereby (i) agrees (on behalf
of itself and its Affiliates) that the Agent shall have no liability to Company,
any Secured Party or any of their respective Affiliates for applying such
remaining proceeds in accordance with written directions received by the Agent
from all of the Secured Parties or pursuant to a court order issued by a court
of competent jurisdiction and (ii) waives (on behalf of itself and its
Affiliates) any and all claims and causes of action against the Agent for
applying such remaining proceeds in accordance with any such written directions
or court order.

 

 

 

 

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(c)               In the event that the Agent receives proceeds from any sale,
collection, foreclosure, disposition or other realization upon any Pledged
Collateral and has not received a written direction signed by all of the Secured
Parties setting forth the amount of such proceeds payable to each Secured Party
pursuant to Section 10(a)(ii) above, each of the Secured Parties and Company
hereby (i) agrees that after applying such proceeds in accordance with Section
10(a)(i) above, the Agent may (x) retain such remaining proceeds, for the
benefit of the Secured Parties, until such time as (A) the Agent has received a
written direction signed by all of the Secured Parties setting forth the amount
of such proceeds payable to each Secured Party pursuant to Section 10(a)(ii)
above or (B) a court order has been issued by a court of competent jurisdiction
directing the manner in which the Agent shall distribute such remaining proceeds
or (y) interplead the amount of the distributions that should be made pursuant
to clauses (ii) through (iv) of Section 10(a) above in any court of competent
jurisdiction, without further responsibility in respect of such distributions
under this Section 10 and (ii) waives any and all claims and causes of action
against the Agent for taking any actions permitted by the immediately preceding
clause (i) of this Section 10(c).

 

(d)               If, upon the sale or other disposition of the Collateral, the
proceeds thereof are insufficient to pay all amounts to which the Agent and the
Secured Parties are legally entitled, the Company will be liable for the
deficiency, together with interest thereon, at the rate set forth in the Notes,
and the reasonable fees, costs and expenses of any attorneys employed by the
Agent or the Secured Parties to collect such deficiency. To the extent permitted
by applicable law, the Company waives all claims, damages and demands against
the Secured Parties and the Agent arising out of the repossession, removal,
retention or sale of the Collateral, unless, with respect to the Secured
Parties, due solely to the gross negligence or willful misconduct of the Secured
Parties as determined by a final judgment (not subject to further appeal) of a
court of competent jurisdiction.

 

11.              Securities Law Provision. The Company recognizes that the Agent
may be limited in its ability to effect a sale to the public of all or part of
the Pledged Shares by reason of certain prohibitions in the Securities Laws and
may be compelled to resort to one or more sales to a restricted group of
purchasers who may be required to agree to acquire the Pledged Shares for their
own account, for investment and not with a view to the distribution or resale
thereof. The Company agrees that sales so made may be at prices and on terms
less favorable than if the Pledged Shares were sold to the public, and that the
Agent has no obligation to delay the sale of any Pledged Shares for the period
of time necessary to register the Pledged Shares for sale to the public under
the Securities Laws. The Company shall cooperate with the Agent in its attempt
to satisfy any requirements under the Securities Laws applicable to the sale of
the Pledged Shares by the Agent.

 

12.              Costs and Expenses. The Company agrees to pay, promptly upon
demand, (i) the fees set forth in the Agent Fee Letter, (ii) all reasonable
out-of-pocket fees, costs and expenses incurred by the Agent and its agents in
the preparation, execution, delivery, filing, recordation, administration,
continuation or enforcement of this Agreement or any other Transaction Document
or any consent, amendment, waiver or other modification relating hereto or
thereto, or the transactions contemplated thereby or the exercise of rights or
performance of obligations by the Agent thereunder, (iii) all reasonable
out-of-pocket fees, expenses and disbursements of legal counsel and any
auditors, accountants, consultants or appraisers or other professional advisors
and agents engaged by the Agent incurred in connection with the negotiation,
preparation, closing, administration, continuation, performance or enforcement
of this Agreement or any other Transaction Document or any consent, amendment,
waiver or other modification relating hereto or thereto, or the transactions
contemplated thereby or the exercise of rights or performance of obligations by
the Agent thereunder and any other document or matter requested by Company and
(iv) all reasonable out-of-pocket costs and expenses incurred by the Agent and
its agents in creating, perfecting, preserving, releasing or enforcing the
Agent’s liens on and security interest in the Pledged Collateral, including, in
connection with any filing or recording required or permitted hereunder, any
filing and recording fees, expenses and taxes, stamp or documentary taxes, and
any expenses of any searches reasonably required by the Agent. The Company shall
also pay all other claims and charges which in the reasonable opinion of the
Agent or the Required Holders is reasonably likely to prejudice, imperil or
otherwise affect the Collateral or the security interests therein. The Company
will also pay, promptly upon demand, any and all reasonable fees, costs and
expenses of the Agent, including the reasonable fees, expenses and disbursements
of its legal counsel and of any auditors, accountants, consultants or appraisers
or other professional advisors, experts and agents, which the Agent, for the
benefit of itself and the Secured Parties, or the Secured Parties may incur in
connection with (i) the protection, preservation, satisfaction, foreclosure,
collection or enforcement of the Collateral subject to this Agreement and the
security interest therein and lien thereon, (ii) the enforcement of this
Agreement, (iii) the custody or preservation of, or the sale of, collection
from, or other realization upon, any of the Collateral, or (iv) the exercise or
enforcement of any of the rights of collection of the Secured Parties under the
Notes. Such fees shall be paid within fifteen (15) days of submission of a
request by the Agent to the Company and the Company shall promptly notify the
Agent and the Secured Parties of the payment of such fees. Each of the parties
hereto hereby acknowledges and agrees that the Agent Fee Letter shall constitute
a Transaction Document, and all fees, costs, expenses and compensation payable
thereunder shall constitute Obligations secured equally and ratably by the
Collateral. All of the agreements in this Section 12 will survive and remain
operative and in full force and effect regardless of the repayment of the
Obligations, the termination of this Agreement or the resignation or removal of
the Agent.

 

 

 

 

 

 

 

9  

 

 

13.              Security Interests Absolute. All rights of the Agent and the
Secured Parties and all obligations of the Company hereunder, shall be absolute
and unconditional, irrespective of: (a) any lack of validity or enforceability
of this Agreement, the Notes or any agreement entered into in connection with
the foregoing, or any portion hereof or thereof; (b) any change in the time,
manner or place of payment or performance of, or in any other term of, all or
any of the Obligations, or any other amendment or waiver of or any consent to
any departure from the Notes or any other agreement entered into in connection
with the foregoing; (c) any exchange, release or nonperfection of any of the
Collateral, or any release or amendment or waiver of or consent to departure
from any other collateral for, or any guarantee, or any other security, for all
or any of the Obligations; or (d) any other circumstance which might otherwise
constitute any legal or equitable defense available to the Company, or a
discharge of all or any part of the security interests granted hereby. Until the
Obligations shall have been paid and performed in full, the rights of the Agent
and the Secured Parties shall continue even if the Obligations are barred for
any reason, including, without limitation, the running of the statute of
limitations or bankruptcy. The Company expressly waives presentment, protest,
notice of protest, demand, notice of nonpayment and demand for performance. In
the event that at any time any transfer of any Collateral or any payment
received by the Agent or the Secured Parties hereunder shall be deemed by final
order of a court of competent jurisdiction to have been a voidable preference or
fraudulent conveyance under the bankruptcy or insolvency laws of the United
States, or shall be deemed to be otherwise due to any party other than the Agent
or the Secured Parties, then, in any such event, the Company’s obligations
hereunder shall survive cancellation of this Agreement, and shall not be
discharged or satisfied by any prior payment thereof and/or cancellation of this
Agreement, but shall remain a valid and binding obligation enforceable in
accordance with the terms and provisions hereof. The Company waives all right to
require the Agent or the Secured Parties to proceed against any other person or
entity or to apply any Collateral which the Agent or the Secured Parties may
hold at any time, or to marshal assets, or to pursue any other remedy. The
Company waives any defense arising by reason of the application of the statute
of limitations to any obligation secured hereby.

 

14.              Term of Agreement. This Agreement and the Liens granted hereby
shall terminate on the date on which all payments under the Notes have been
indefeasibly paid in full and all other Obligations have been paid or
discharged; provided, however, that all indemnities of the Company contained in
this Agreement shall survive and remain operative and in full force and effect
regardless of the repayment of the Obligations, the termination of this
Agreement or the resignation or removal of the Agent. Upon such termination, the
Agent, at the written request and expense of the Company, will promptly execute
and deliver to the Company a proper instrument or instruments (including UCC
termination statements on form UCC-3) acknowledging the satisfaction and
termination of this Agreement, and will duly assign, transfer and deliver to the
Company (without recourse and without any representation or warranty) such of
the Pledged Collateral as may be in the possession of the Agent and as has not
theretofore been sold or otherwise applied or released pursuant to this
Agreement.

 

15.              Power of Attorney; Further Assurances.

 

(a)               The Company authorizes the Agent, acting on behalf of itself
and the Secured Parties, as set forth herein, and does hereby make, constitute
and appoint the Agent and its agents, successors or assigns with full power of
substitution, as the Company’s true and lawful attorney-in-fact, with power, in
the name of the Agent or the Company, to, after the occurrence and during the
continuance of an Event of Default, generally, at the option of the Agent (or at
the direction of the Required Holders), and at the expense of the Company, at
any time, or from time to time, to execute and deliver any and all documents and
instruments and to do all acts and things which the Agent or the Required
Holders deem necessary to protect, preserve and realize upon the Collateral and
the security interests granted therein in order to effect the intent of this
Agreement and the Notes all as fully and effectually as the Company might or
could do; and the Company hereby ratifies all that said attorney shall lawfully
do or cause to be done by virtue hereof. This power of attorney is coupled with
an interest and shall be irrevocable for the term of this Agreement and
thereafter as long as any of the Obligations shall be outstanding. The
designation set forth herein shall be deemed to amend and supersede any
inconsistent provision in the Organizational Documents or other documents or
agreements to which the Company is subject or to which the Company is a party.

 

 

 

10  

 

 

(b)               The Company hereby irrevocably appoints the Agent as the
Company’s attorney-in-fact, with full authority in the place and instead of the
Company and in the name of the Company, to take any action and to execute any
instrument which the Agent or the Required Holders may deem necessary or
advisable to accomplish the purposes of this Agreement, including the filing of
one or more financing or continuation statements and amendments thereto,
relative to any of the Collateral without the signature of the Company where
permitted by law and ratifies all such actions taken by the Agent. This power of
attorney is coupled with an interest and shall be irrevocable for the term of
this Agreement and thereafter as long as any of the Obligations shall be
outstanding.

 

16.              Notices. Any and all notices or other communications or
deliveries required or permitted to be provided hereunder shall be in writing
and shall be deemed given and effective on the earliest of: (a) the date of
transmission, if such notice or communication is delivered via facsimile at the
facsimile number set forth on the signature pages attached hereto or by
electronic mail at the e-mail address set forth on the signature pages attached
hereto prior to 5:30 p.m. (New York time) on a Business Day, (b) the next
Business Day after the date of transmission, if such notice or communication is
delivered via facsimile at the facsimile number set forth on the signature pages
attached hereto or by electronic mail at the e-mail address set forth on the
signature pages attached hereto on a day that is not a Business Day or later
than 5:30 p.m. (New York time) on any Business Day, (c) the 2nd Business Day
following the date of mailing, if sent by U.S. nationally recognized overnight
courier service or (d) upon actual receipt by the party to whom such notice is
required to be given. The address for such notices and communications shall be
as set forth on the signature pages attached hereto (or, in the case of a Person
that becomes a Secured Party after the date hereof, in the Security Agreement
Joinder pursuant to which such Person becomes a party hereto) or such other
address as the recipient party to whom notice is to be given may have furnished
to the other party in writing in accordance herewith.

 

17.              Agent.

 

(a)               Appointment. The Secured Parties, by their acceptance of the
benefits of the Agreement, hereby designate Cortland Capital Market Services LLC
as the Agent to act as specified herein. Each Secured Party shall be deemed
irrevocably to authorize and direct the Agent to take such action on its behalf
under the provisions of this Agreement and to exercise such powers and to
perform such duties hereunder and thereunder as are specifically delegated to or
required of the Agent by the terms hereof and thereof and such other powers as
are reasonably incidental thereto. The Agent may perform any and all of its
duties hereunder and exercise its rights and powers hereunder by or through any
one or more sub-agents appointed by it, and will not be responsible for any
misconduct or negligence on the part of any of them. The Agent and any such
sub-agent may perform any and all of its duties hereunder and exercise its
rights and powers hereunder by or through their respective Affiliates. The
exculpatory and indemnification provisions of this Agreement shall apply to any
such sub-agent and to the Affiliates of the Agent and any such sub-agent. All of
the rights, benefits, and privileges (including the exculpatory and
indemnification provisions) of this Agreement shall apply to any such sub-agent
and to the Affiliates of any such sub-agent as if such sub-agent and Affiliates
were named herein.

 

(b)               Nature of Duties. The Agent shall have no duties or
responsibilities except those expressly set forth in this Agreement. Without
limiting the generality of the foregoing, (i) the Agent shall not have any duty
to take any discretionary action or exercise any discretionary powers, except
discretionary rights and powers expressly contemplated hereby that the Agent is
instructed in writing to exercise by the Required Holders (or such greater
number of Holders as may be expressly required herein); provided that the Agent
shall not be required to take any action that, in its opinion or the opinion of
its legal counsel, may expose the Agent to liability or that is contrary to this
Agreement or any other Transaction Document or applicable law, including for the
avoidance of doubt any action that may be in violation of the automatic stay
under the Bankruptcy Code, and (ii) neither the Agent nor any of its partners,
officers, directors, employees or agents shall be liable for any action taken or
not taken by it as such under this Agreement or hereunder or in connection
herewith or therewith, be responsible for the consequence of any oversight or
error of judgment or answerable for any loss, unless caused solely by it or its
gross negligence or willful misconduct as determined by a final judgment (not
subject to further appeal) of a court of competent jurisdiction, and then only
for direct damages to the extent provided by law and not for any lost profits or
special, indirect or consequential damages or (to the fullest extent a claim for
punitive damages may lawfully be waived) any punitive damages; provided,
further, that neither the Agent nor any of its partners, officers, directors,
employees or agents shall be liable for any action taken or not taken by it with
the consent or at the request of the Required Holders (or such greater number of
Holders as may be expressly required herein). The duties of the Agent shall be
mechanical and administrative in nature; the Agent shall not have by reason of
this Agreement or any other related agreement a fiduciary relationship or other
implied duties under this Agreement or any other related agreement, or in
respect of the Company or any Secured Party, regardless of whether an Event of
Default has occurred and is continuing; and nothing in the Agreement or any
other related agreement, expressed or implied, is intended to or shall be so
construed as to impose upon the Agent any obligations in respect of this
Agreement or any other related agreement except as expressly set forth herein
and therein.

 

 

 

11  

 

 

(c)               Other Agreements. The Agent has accepted and is bound by this
Agreement. The Agent will not otherwise be bound by, or be held obligated by,
the provisions of any note purchase agreement, indenture, note or other
agreement (other than this Agreement and the other documents executed by the
Agent in connection herewith).

 

(d)               Lack of Reliance on the Agent. Independently and without
reliance upon the Agent, each Secured Party, to the extent it deems appropriate,
has made and shall continue to make (i) its own independent investigation of the
financial condition and affairs of the Company and its subsidiaries in
connection with such Secured Party’s purchase of Notes, the creation and
continuance of the Obligations, the transactions contemplated by the Transaction
Documents, and the taking or not taking of any action in connection therewith,
and (ii) its own appraisal of the creditworthiness of the Company, and of the
value of the Collateral from time to time, and the Agent shall have no duty or
responsibility, either initially or on a continuing basis, to provide any
Secured Party with any credit, market or other information with respect thereto,
whether coming into its possession before any Obligations are incurred or at any
time or times thereafter. The Agent shall not be responsible to the Company or
any Secured Party for any recitals, statements, information, financial
statements, representations or warranties herein or in any document, certificate
or other writing delivered in connection herewith, or for the execution,
effectiveness, genuineness, validity, enforceability, perfection,
collectability, priority or sufficiency of this Agreement or any other related
agreement or any contracts or insurance policies, or for the financial condition
of the Company or the value of any of the Collateral, or have any duty to
ascertain or be required to make any inquiry concerning either the performance
or observance of any of the terms, provisions or conditions of this Agreement or
any other related agreement, or the financial condition of the Company, or the
value of any of the Collateral, or the existence or possible existence or
absence of any default or Event of Default under this Agreement, Notes or any of
the other related agreement, or the contents of any certificate, report or other
document delivered under this Agreement, Notes or any of the other related
agreement or in connection therewith. It is acknowledged and agreed by the
Secured Parties and the Company that the Agent (i) has undertaken no analysis of
this Agreement or the Pledged Collateral and (ii) has made no determination as
to (x) the validity, enforceability, perfection, collectability, priority or
sufficiency of any Liens granted or purported to be granted pursuant to this
Agreement or (y) the accuracy or sufficiency of the documents, filings,
recordings and other actions taken, or to be taken, to create, perfect or
maintain the existence, perfection or priority of the Liens granted or purported
to be granted pursuant to this Agreement. The Agent shall be entitled to assume
that all Liens purported to be granted pursuant to this Agreement are valid and
perfected Liens having the priority intended by the Secured Parties and this
Agreement.

 

(e)               Certain Rights of the Agent. The Agent shall have the right to
take any action with respect to the Collateral, on behalf of itself and all of
the Secured Parties. Whenever reference is made in this Agreement to any action
by, consent, designation, specification, requirement or approval of, notice,
request or other communication from, or other direction given or action to be
undertaken or to be (or not to be) suffered or omitted by the Agent to any
amendment, waiver or other modification of this Agreement to be executed (or not
to be executed) by the Agent or to any election, decision, opinion, acceptance,
use of judgment, expression of satisfaction or other exercise of discretion,
rights or remedies to be made (or not to be made) by the Agent, it is understood
that in all cases the Agent shall be fully justified in failing or refusing to
take any such action under this Agreement as it deems appropriate. This
provision is intended solely for the benefit of the Agent and its successors and
permitted assigns and is not intended to and will not entitle the other parties
hereto to any defense, claim or counterclaim under or in relation to any
Transaction Document, or confer any rights or benefits on any party hereto. The
Agent shall be entitled to refrain from any act or the taking of any action
(including the failure to take an action) in connection herewith or from the
exercise of any power, discretion or authority vested in it hereunder or
thereunder unless and until the Agent shall have received written instructions
in respect thereof from the Required Holders (or such greater number of Holders
as may be expressly required herein) and, upon receipt of such instructions from
the Required Holders (or such greater number of Holders as may be expressly
required herein), the Agent shall be entitled to act or (where so instructed)
refrain from action, or to exercise such power, discretion or authority, in
accordance with such instructions. The Agent may at any time solicit written
confirmatory instructions from the Required Holders (or such greater number of
Holders as may be expressly required herein) or request an order of a court of
competent jurisdiction as to any action that it may be requested or required to
take, or that it may propose to take, in the performance of any of its
obligations under this Agreement. If such instructions or order are not provided
despite the Agent’s request therefor, the Agent shall be entitled to refrain
from such act or taking such action and may suspend performance of such
obligations as it determines to be appropriate until it receives such
instructions or order, and if such action is taken, shall be entitled to
appropriate indemnification from the Secured Parties in respect of actions to be
taken by the Agent; and the Agent shall not incur liability to any person or
entity by reason of so refraining. Without limiting the foregoing, (a) no
Secured Party shall have any right of action whatsoever against the Agent as a
result of the Agent acting or refraining from acting hereunder in accordance
with the terms of the Agreement or any other related agreement, and the Company
shall have no right to question or challenge the authority of, or the
instructions given to, the Agent pursuant to the foregoing except in the case of
the gross negligence or willful misconduct of the Agent as determined by a final
judgment (not subject to further appeal) of a court of competent jurisdiction
and (b) the Agent shall not be required to take any action which the Agent
believes (i) could reasonably be expected to expose it to personal liability, or
(ii) require it to expend or risk its own funds, or (iii) is contrary to this
Agreement, the Notes, any other related agreement or applicable law.

 

 

 

12  

 

 

(f)                Reliance. The Agent shall be entitled to conclusively rely,
and shall be fully protected in relying, upon any writing, facsimile,
resolution, notice, statement, certificate, telex, teletype or telecopier
message, cablegram, radiogram, order or other document, sent or made by the
Company or any Secured Party, without being required to determine the
authenticity thereof or the correctness of any fact stated therein or the
propriety or validity of service thereof, upon any judicial order or judgment
pertaining to the Agreement, the Notes, the Agent Fee Letter and any other
related agreement and the transactions contemplated thereunder, and, with
respect to all legal matters pertaining to the Agreement, the Notes, the Agent
Fee Letter and any other related agreement and its duties thereunder, upon any
advice, opinion or statement of legal counsel selected by it and upon all other
matters pertaining to this Agreement, the Notes, the Agent Fee Letter and any
other related agreement and its duties thereunder, upon advice of independent
consultants and other experts selected by it, and may assume that any Person
purporting to give notice or receipt or advice or make any statement or execute
any document in connection with the provisions hereof or the other Transaction
Documents has been duly authorized to do so. Anything to the contrary
notwithstanding, the Agent shall have no obligation whatsoever to any Secured
Party to assure that the Collateral exists or is owned by the Company or is
cared for, protected or insured or that the liens granted pursuant to this
Agreement have been properly or sufficiently or lawfully created, perfected, or
enforced or are entitled to any particular priority.

 

(g)               Limitations on Duty of Agent in Respect of Pledged Collateral.

 

(i)                 Beyond its obligations under Sections 4 and 6 hereof and the
exercise of reasonable care in the custody of Pledged Collateral in its
possession, the Agent will have no duty as to any Pledged Collateral in its
possession or control or in the possession or control of any agent or bailee or
any income thereon or as to preservation of rights against prior parties or any
other rights pertaining or otherwise perfecting or maintaining the perfection of
any Liens on the Pledged Collateral. The Agent will be deemed to have exercised
reasonable care in the custody of the Pledged Collateral in its possession if
the Pledged Collateral is accorded treatment substantially equal to that which
it accords its own property, and the Agent will not be liable or responsible for
any loss or diminution in the value of any of the Pledged Collateral by reason
of the act or omission of any carrier, forwarding agency or other agent or
bailee selected by the Agent in good faith.

 

(ii)              The Agent will not be responsible for the existence,
genuineness or value of any of the Pledged Collateral or for the validity,
perfection, priority or enforceability of the Liens in any of the Pledged
Collateral, whether impaired by operation of law or by reason of any action or
omission to act on its part hereunder, except to the extent such action or
omission constitutes gross negligence or willful misconduct on the part of the
Agent, for the validity or sufficiency of the Pledged Collateral or any
agreement or assignment contained therein, for the validity of the title of the
Company to the Pledged Collateral, for insuring the Pledged Collateral or for
the payment of taxes, charges, assessments or Liens upon the Pledged Collateral
or otherwise as to the maintenance of the Pledged Collateral. The Agent hereby
disclaims any representation or warranty to the present and future holders of
the Obligations concerning the perfection of the Liens granted hereunder or in
the value of any of the Pledged Collateral.

 

(h)               Security or Indemnity in favor of the Agent(i). The Agent will
not be required to advance or expend any funds or otherwise incur any financial
liability in the performance of its duties or the exercise of its powers or
rights hereunder unless it has been provided with security or indemnity
reasonably satisfactory to it against any and all liability or expense which may
be incurred by it by reason of taking or continuing to take such action.

 

 

 

 

 

 

 

13  

 

 

(i)                 Indemnification. To the extent that the Agent is not
reimbursed and indemnified by the Company, the Secured Parties, shall severally,
and not jointly, reimburse and indemnify the Agent and its Affiliates, and each
and all of their respective partners, members, shareholders, officers,
directors, employees, trustees, attorneys and agents (and any other persons with
other titles that have similar functions) and (in each case) their respective
heirs, representatives, successors and assigns (each of the foregoing, an “Agent
Indemnitee”), in proportion to the outstanding amount of their respective
principal amounts of the Notes on the date on which indemnification is sought
under this Section 17(i) (or, if indemnification is sought after the date upon
which the Notes have been paid in full, in proportion to the outstanding amount
of their respective principal amounts of the Notes immediately prior to such
date), from and against any and all losses, claims, liabilities, obligations,
damages, penalties, suits, actions, judgments, costs, taxes, disbursements and
expenses of any kind or nature whatsoever which may be imposed on, incurred by
or asserted against any Agent Indemnitee in performing its duties hereunder or
under any other related agreement, or in any way relating to or arising out of
this Agreement and any other related agreement, IN ALL CASES, WHETHER OR NOT
CAUSED BY OR ARISING, IN WHOLE OR IN PART, OUT OF THE COMPARATIVE, CONTRIBUTORY,
OR SOLE NEGLIGENCE OF SUCH AGENT INDEMNITEE; provided, no Agent Indemnitee will
be entitled to indemnification hereunder of any such losses, claims,
liabilities, obligations, damages, penalties, suits, actions, judgments, costs,
taxes, disbursements and expenses which result from the gross negligence or
willful misconduct of such Agent Indemnitee as determined by a final,
nonappealable decision of a court of competent jurisdiction. Prior to taking any
action or further action hereunder as the Agent, the Agent may require each
Secured Party to deposit with it sufficient sums as it determines in good faith
is necessary to protect the Agent for costs and expenses associated with taking
such action or further action; provided, in no event shall this sentence require
any Secured Party to indemnify any Agent Indemnitee against any liability,
obligation, loss, damage, penalty, action, judgment, suit, cost, expense or
disbursement in excess of an amount in proportion to the outstanding amount of
their respective principal amounts of the Notes on the date on which
indemnification is sought under this Section 17(i) (or, if indemnification is
sought after the date upon which the Notes have been paid in full, in proportion
to the outstanding amount of their respective principal amounts of the Notes
immediately prior to such date); and provided further, this sentence shall not
be deemed to require any Secured Party to indemnify any Agent Indemnitee against
any liability, obligation, loss, damage, penalty, action, judgment, suit, cost,
expense or disbursement described in the proviso in the immediately preceding
sentence. All of the agreements in this Section 17(i) will survive and remain
operative and in full force and effect regardless of the repayment of the
Obligations, the termination of this Agreement or the resignation or removal of
the Agent.

 

(j)                 Resignation or Removal of the Agent.

 

(i)                 The Agent may resign from the performance of all its
functions and duties under this Agreement and the other Transaction Documents at
any time by giving not less than 30 days’ prior written notice to the Company
and the Secured Parties, and, subject to the appointment of a successor Agent
and the acceptance of such appointment by the successor Agent, the Agent may be
removed at any time by the Secured Parties. Such resignation or removal shall
take effect upon the appointment of a successor Agent pursuant to clauses (ii)
and (iii) below.

 

(ii)              Upon any such notice of resignation or removal, the Required
Holders shall appoint a successor Agent hereunder.

(iii)            If a successor Agent shall not have been so appointed within 30
days after the retiring Agent gave notice of resignation or was removed, the
retiring Agent may, at its option, (i) appoint a successor Agent who shall serve
as successor Agent until such time, if any, as the Secured Parties appoint a
successor Agent as provided above or (ii) petition any court of competent
jurisdiction or may interplead the Company and the Secured Parties in a
proceeding for the appointment of a successor Agent, and, in each cash, all
fees, costs and expenses, including, but not limited to, extraordinary fees
associated with the filing of interpleader and expenses associated therewith,
shall be payable by the Company on demand; provided, that, notwithstanding the
foregoing, in the case of a resignation by the Agent, if no successor Agent has
been appointed by the 30th day after the date the Agent has given notice of its
resignation in accordance with clause (i) above, the Agent’s resignation shall
nevertheless become effective and the Secured Parties shall thereafter perform
all of the duties of the Agent under this Agreement until such time, if any, as
the Secured Parties appoint a successor Agent.

 

(k)               Rights with respect to Collateral. Each Secured Party agrees
with all other Secured Parties and the Agent (i) that it shall not, and shall
not attempt to, exercise any rights with respect to its security interest in the
Collateral, whether pursuant to any other agreement or otherwise (other than
pursuant to this Agreement), and (ii) that such Secured Party has no other
rights with respect to the Collateral other than as set forth in this Agreement,
the Notes and any other related agreements. Upon the acceptance of any
appointment as Agent hereunder by a successor Agent, such successor Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring Agent and the retiring Agent shall be discharged from
its duties and obligations under this Agreement. The retiring Agent will (at the
sole expense of the Company) promptly transfer all Liens and collateral security
within its possession or control to the possession or control of the successor
Agent and will execute such instruments and assignments as may be reasonably
requested by the successor Agent to transfer to the successor Agent all Liens,
interests, rights, powers and remedies of the predecessor Agent in respect of
this agreement or the Pledged Collateral. After any retiring Agent’s resignation
or removal hereunder as collateral agent, the provisions of this Agreement,
including without limitation the immunities granted to it in Sections 12, 17 and
18(j) hereof shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was Agent hereunder and any actions taken in accordance
with this clause (l).

 

 

 

14  

 

 

18.              Miscellaneous.

 

(a)               No course of dealing between the Company and the Agent or any
Secured Party, nor any failure to exercise, nor any delay in exercising, on the
part of the Agent or any Secured Party, any right, power or privilege hereunder
or under the Notes shall operate as a waiver thereof; nor shall any single or
partial exercise of any right, power or privilege hereunder or thereunder
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege.

 

(b)               All of the rights and remedies of the Agent and the Secured
Parties with respect to the Collateral, whether established hereby or by the
Notes or by any other agreements, instruments or documents or by law shall be
cumulative and may be exercised singly or concurrently.

 

(c)               This Agreement, together with any exhibits and schedules
hereto, contain the entire understanding of the parties with respect to the
subject matter hereof and supersede all prior agreements and understandings,
oral or written, with respect to such matters, which the parties acknowledge
have been merged into this Agreement and any exhibits and schedules hereto. No
provision of this Agreement may be waived, modified, supplemented or amended
except in a written instrument signed by the Company, the Secured Parties and
the Agent.

 

(d)               No waiver of any default with respect to any provision,
condition or requirement of this Agreement shall be deemed to be a continuing
waiver in the future or a waiver of any subsequent default or a waiver of any
other provision, condition or requirement hereof, nor shall any delay or
omission of any party to exercise any right hereunder in any manner impair the
exercise of any such right or any other right, power or remedy.

 

(e)               This Agreement shall be binding upon and inure to the benefit
of the parties and their successors and permitted assigns. The Company may not
assign this Agreement or any rights or obligations hereunder without the prior
written consent of the Required Holders. Each of the Secured Parties and the
Company agree that, notwithstanding anything to the contrary in the Purchase
Agreement or any other Transaction Document, no Person may become a Holder of a
Note after the date hereof and a Secured Party hereunder (whether through a
sale, transfer or assignment to such Person of any Holder’s rights or interests
in all or a portion of any Note or any other Obligations, or otherwise), unless,
on or prior to the date such Person becomes a Holder of a Note, such Person (i)
agrees in writing to be bound by the terms of this Agreement as a “Secured
Party” by executing and delivering a Security Agreement Joinder to the Agent and
(ii) provides the Agent with all documentation and other information that the
Agent requests in order to comply with the Agent’s obligations under applicable
“know your customer” and anti-money laundering rules and regulations, including
the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26,
2001)), and the results of any such “know your customer” or similar
investigation conducted by the Agent shall be satisfactory to the Agent. Any
sale, transfer or assignment to any Person of any Secured Party’s rights or
interests in all or a portion of any Note or any other Obligations made in
violation of the provisions of this Section 18(e) shall be void ab initio.

 

(f)                Promptly following a request made by the Agent to a Holder,
such Holder shall notify the Collateral Agent of the outstanding principal
amount of Notes held by such Holder at such time.

 

(g)               Each party shall take such further action and execute and
deliver such further documents as may be necessary or appropriate in order to
carry out the provisions and purposes of this Agreement.

 

 

 

 

15  

 

 

(h)               This Agreement shall be construed and enforced in accordance
with, and all questions concerning the construction, validity, interpretation
and performance of this Agreement shall be governed by, the internal laws of the
State of New York, without giving effect to any choice of law or conflict of law
provision or rule (whether of the State of New York or any other jurisdictions)
that would cause the application of the laws of any jurisdictions other than the
State of New York. The Company, each Holder and the Agent hereby irrevocably
submits to the exclusive jurisdiction of the state and federal courts sitting in
The City of New York, Borough of Manhattan, for the adjudication of any dispute
hereunder or in connection herewith or with any transaction contemplated hereby
or discussed herein, and hereby irrevocably waives, and agrees not to assert in
any suit, action or proceeding, any claim that it is not personally subject to
the jurisdiction of any such court, that such suit, action or proceeding is
brought in an inconvenient forum or that the venue of such suit, action or
proceeding is improper. Nothing contained herein shall be deemed to limit in any
way any right to serve process in any manner permitted by law. In the event that
any provision of this Agreement is invalid or unenforceable under any applicable
statute or rule of law, then such provision shall be deemed inoperative to the
extent that it may conflict therewith and shall be deemed modified to conform
with such statute or rule of law. Any such provision which may prove invalid or
unenforceable under any law shall not affect the validity or enforceability of
any other provision of this Agreement. Nothing contained herein shall be deemed
or operate to preclude any Holder or the Agent from bringing suit or taking
other legal action against the Company in any other jurisdiction to enforce a
judgment or other court ruling in favor of any Holder or the Agent. THE COMPANY,
EACH HOLDER AND THE AGENT HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE TO,
AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE
HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT OR ANY
TRANSACTION CONTEMPLATED HEREBY.

 

(i)                 This Agreement may be executed in any number of
counterparts, each of which when so executed shall be deemed to be an original
and, all of which taken together shall constitute one and the same Agreement. In
the event that any signature is delivered by facsimile transmission, such
signature shall create a valid binding obligation of the party executing (or on
whose behalf such signature is executed) the same with the same force and effect
as if such facsimile signature were the original thereof.

 

(j)                 The Company shall defend, indemnify, pay, reimburse and hold
harmless the Secured Parties and the Agent and each of their respective
Affiliates, and each and all of their respective partners, members,
shareholders, officers, directors, employees, trustees, attorneys and agents
(and any other persons with other titles that have similar functions) and (in
each case) their respective heirs, representatives, successors and assigns (each
of the foregoing, an “Indemnitee”) from and against any and all losses, claims,
liabilities, obligations, damages, penalties, suits, actions, judgments, costs,
taxes, disbursements and expenses, of any kind or nature (including fees
relating to the cost of investigating, defending and otherwise addressing any of
the foregoing, including reasonable fees and expenses of legal counsel selected
by any Indemnitee, whether or not suit is brought), whether direct, indirect or
consequential and whether based on any federal, state or foreign laws, statutes,
rules or regulations (including securities and commercial laws, statutes, rules
or regulations and environmental laws), on common law or equitable cause or on
contract or otherwise, that may be imposed on, incurred by or asserted against
any Indemnitee in any way related to or arising from or alleged to arise from
this Agreement or the Collateral, or in any way related to or arising from or
alleged to arise from the execution, delivery, performance, administration or
enforcement of this Agreement, including any of the foregoing relating to the
violation of, noncompliance with or liability under, any law applicable to or
enforceable against any Company or any of its Affiliates or any of the Pledged
Collateral, IN ALL CASES, WHETHER OR NOT CAUSED BY OR ARISING, IN WHOLE OR IN
PART, OUT OF THE COMPARATIVE, CONTRIBUTORY, OR SOLE NEGLIGENCE OF SUCH
INDEMNITEE; provided, no Indemnitee will be entitled to indemnification
hereunder of any such losses, claims, liabilities, obligations, damages,
penalties, suits, actions, judgments, costs, taxes, disbursements and expenses
which result from the gross negligence or willful misconduct of such Indemnitee
as determined by a final, nonappealable decision of a court of competent
jurisdiction. To the extent that the undertakings to defend, indemnify, pay and
hold harmless set forth in this Section 18(j) may be unenforceable in whole or
in part because they are violative of any law or public policy, the Company
shall contribute the maximum portion that it is permitted to pay and satisfy
under applicable law to the payment and satisfaction of all indemnified amounts
incurred by the Indemnitees or any of them. All of the agreements in this
Section 18(j) will survive and remain operative and in full force and effect
regardless of the repayment of the Obligations, the termination of this
Agreement or the resignation or removal of the Agent.

 

 

 

 

16  

 

 

(k)               Nothing in this Agreement shall be construed to subject the
Agent or any Secured Party to liability as an officer or director of the Company
or a partner in any of the Company’s direct or indirect subsidiaries that is a
partnership or as a member in any of the Company direct or indirect subsidiaries
that is a limited liability company, nor shall the Agent or any Secured Party be
deemed to have assumed any obligations under any partnership agreement or
limited liability company agreement, as applicable, of any the Company or any of
its direct or indirect subsidiaries or otherwise, unless and until the Agent or
any such Secured Party, as applicable, exercises its right to be substituted for
the Company as a partner or member, as applicable, pursuant hereto.

 

(l)                 To the extent that the grant of the security interest in the
Collateral and the enforcement of the terms hereof require the consent, approval
or action of any partner or member, as applicable, of the Company or any direct
or indirect subsidiary of the Company or compliance with any provisions of any
of the Organizational Documents, the Company hereby grants such consent and
approval and waive any such noncompliance with the terms of said documents.

 

(m)             The Company and each Secured Party is subject to the
requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into
law October 26, 2001)) (the “Patriot Act”) and the Agent (for itself and not on
behalf of any Secured Party), hereby notifies all future Secured Parties,
including subsequent assignees or transferees, that pursuant to the requirements
of the Patriot Act, it is required to obtain, verify and record information that
identifies the Secured Party, which information includes the name and address of
the Secured Party and other information that will allow the Agent, to identify
the Secured Party in accordance with the Patriot Act. For a non-individual
person such as a business entity, a charity, a trust or other legal entity the
Agent will ask for documentation to verify its formation and existence as a
legal entity. The Agent may also ask to see financial statements, licenses,
identification and authorization documents from individuals claiming authority
to represent the entity or other relevant documentation. The Secured Parties
shall provide such information and take such actions as are requested by the
Agent in order to maintain compliance with the Patriot Act.

 

(n)               In no event shall the Agent be responsible or liable for any
failure or delay in the performance of its obligations hereunder directly or
indirectly caused by events beyond its control, including general labor
disputes, acts of war or terrorism, civil or military disturbances, nuclear or
natural catastrophes or acts of God, and interruptions, losses or malfunctions
of utilities, communications or computer (software and hardware) services;
provided, however, that the Agent, as the case may be, shall use reasonable
efforts which are consistent with accepted practices in the banking industry to
resume performances as soon as practicable under the circumstances.

 

(o)               Section headings herein have been inserted for convenience of
reference only, are not to be considered a part of this Agreement and will in no
way modify or restrict any of the terms or provisions hereof.

 

(p)               Each Secured Party signatory to this Agreement on the date
hereof hereby represents and warrants to the Agent (solely as to itself, and not
as to any other Secured Party) that (x) as of the date hereof, the outstanding
principal amount of the Notes held by such Secured Party is set forth on
Schedule II hereto and (y) on or prior to the date of this Agreement, it has not
assigned all or any portion of its Notes to any Person, except any Person that
is listed on Schedule II attached hereto.

 

 

 

 

17  

 

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Security Agreement to be
duly executed effective as of December 15, 2016.

 

  COMPANY:       PACIFIC ETHANOL, INC., a Delaware corporation               By:
/s/ Neil M. Koehler   Name: Neil M. Koehler   Title: President and Chief
Executive Officer         Address: 400 Capitol Mall
Suite 2060
Sacramento, CA 95814

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

[Signature Page to Security Agreement]

 

   

 

 

 

  AGENT:       cortland capital market services llc,
as Agent               By: /s/ Polina Arsentyeva   Name: Polina Arsentyeva  
Title: Associate Counsel

 

 

 

Address:

Cortland Capital Market Services LLC

225 W. Washington Street, 21st Floor

Chicago, IL 60606

Attention: Ryan Morick and Legal Department

Telecopy no.: (312) 562-5072

E-mail: ryan.morick@cortlandglobal.com;

legal@cortlandglobal.com

 

with a copy (which copy shall not constitute notice) to:

 

Kaye Scholer LLP

250 W. 55th Street

New York, NY 10019

Attention: Alan Glantz

Telecopy no.: (212) 836-6763

E-mail: alan.glantz@kayescholer.com

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

[Signature Page to Security Agreement]

  

 

 

[SIGNATURE PAGE OF SECURED PARTIES TO SECURITY AGREEMENT]

 

 

  SECURED PARTY:           CWD Summit, LLC,   acting for and on behalf of  
Candlewood Renewable Energy Series I       By:  /s/ David Koenig  
       Name:  David Koenig          Title:  Authorized Signatory          
Address: c/o Candlewood Investment Group, LP
555 Theodore Fremd Avenue, Suite C-303
Rye, NY 10580   Email: compliance@candlewoodgroup.com
Facsimile Number:212-493-4492

 

 

Dated: Effective as of December 15, 2016

 

 

 

 

 

 

[Signature Page to Security Agreement]

   

 

 

 

 

  SECURED PARTY:       Flagler Master Fund SPC Ltd,   acting for and on behalf
of the class A segregated portfolio       By: /s/ Phil DeSantis          Name:
Phil DeSantis          Title:  Authorized Signatory           Address:c/o
Candlewood Investment Group, LP
555 Theodore Fremd Avenue, Suite C-303
Rye, NY 10580   Email: compliance@candlewoodgroup.com
Facsimile Number:212-493-4492

 

Dated: Effective as of December 15, 2016 

 

 

 

 

[Signature Page to Security Agreement]

   

 

 

  SECURED PARTY:       Flagler Master Fund SPC Ltd.,   acting for and on behalf
of the class A segregated portfolio       By: /s/ Phil DeSantis          Name:
Phil DeSantis          Title:  Authorized Signatory           Address:c/o
Candlewood Investment Group, LP
555 Theodore Fremd Avenue, Suite C-303
Rye, NY 10580   Email: compliance@candlewoodgroup.com
Facsimile Number:212-493-4492

 

Dated: Effective as of December 15, 2016 

 

 

 

[Signature Page to Security Agreement]

   

 

 

[SIGNATURE PAGE OF SECURED PARTIES TO SECURITY AGREEMENT]

 

  SECURED PARTY:           CIF-Income Partners (A), LLC       By: BlackRock
Financial Management, Inc.
Its investment manager       By: /s/ Bryan J. Smith          Name: Bryan J.
Smith          Title: Managing Director           Address for Notices:      
BlackRock Alternative Advisors   40 East 52nd Street, 16th Floor   New York, NY
10022   Attn: Stephen Kavulich and Jesse Licht  
BAA-QBCo-InvestmentFundLP@blackrock.com       with a copy to (which shall not
constitute notice):       BlackRock Inc. — Office of the General Counsel   40
East 52nd Street, 19th Floor   New York, NY 10022   Attn: Michelle Galvez, David
Maryles & Larry Gail   legaltransactions@blackrock.com  
larry.gail@blackrock.com

 

 

Dated: Effective as of December 15, 2016

 

 

[Signature Page to Security Agreement]

   

 

 

[SIGNATURE PAGE OF SECURED PARTIES TO SECURITY AGREEMENT]

 

  SECURED PARTY:           Orange 2015 DisloCredit Fund, L.P.       By:
BlackRock Financial Management, Inc.
Its investment manager       By: /s/ Bryan J. Smith          Name: Bryan J.
Smith          Title: Managing Director           Address for Notices:      
BlackRock Alternative Advisors   40 East 52nd Street, 16th Floor   New York, NY
10022   Attn: Stephen Kavulich and Jesse Licht  
BAA-QBCo-InvestmentFundLP@blackrock.com       with a copy to (which shall not
constitute notice):       BlackRock Inc. — Office of the General Counsel   40
East 52nd Street, 19th Floor   New York, NY 10022   Attn: Michelle Galvez, David
Maryles & Larry Gail   legaltransactions@blackrock.com  
larry.gail@blackrock.com

 

 

Dated: Effective as of December 15, 2016

 

 

[Signature Page to Security Agreement]

   

 

 

[SIGNATURE PAGE OF SECURED PARTIES TO SECURITY AGREEMENT]

 

  SECURED PARTY:           Sainsbury’s Credit Opportunities Fund, Ltd.       By:
BlackRock Financial Management, Inc.
Its investment manager       By: /s/ Bryan J. Smith          Name: Bryan J.
Smith          Title: Managing Director           Address for Notices:      
BlackRock Alternative Advisors   40 East 52nd Street, 16th Floor   New York, NY
10022   Attn: Stephen Kavulich and Jesse Licht  
BAA-QBCo-InvestmentFundLP@blackrock.com       with a copy to (which shall not
constitute notice):       BlackRock Inc. — Office of the General Counsel   40
East 52nd Street, 19th Floor   New York, NY 10022   Attn: Michelle Galvez, David
Maryles & Larry Gail   legaltransactions@blackrock.com  
larry.gail@blackrock.com

 

 

Dated: Effective as of December 15, 2016

 

 

[Signature Page to Security Agreement]

   

 

 

 

SCHEDULE I

 

TO SECURITY AGREEMENT

 

 

Pledgor Issuer Class of Equity Interest Certificate No. Par Value Per Share
 Number of Shares Percentage of Issuer's Equity Interests Percentage of Issuer’s
Outstanding Shares of Common Stock Pledged Pacific Ethanol, Inc. PE OP CO., a
Delaware corporation Common Stock 7 $0.001 1,000 100% 100%

 

 

Company’s type of organization: Corporation

 

Company’s jurisdiction of organization: Delaware

 

Company’s Legal Name: Pacific Ethanol, Inc.

 

Company’s Federal Taxpayer Identification Number: 41-2170618

 

Company’s organizational identification number: 3877538

 

Company’s chief executive office or principal place of business: 400 Capital
Mall, Suite 2060, Sacramento, CA 95814.

 

 

   

 

 

SCHEDULE II

 

TO SECURITY AGREEMENT

 

Holder Principal Amount Percentage of Total Notes CWD Summit, LLC - acting for
and on behalf of Candlewood Renewable Energy Series I $ 22,438,545 40.7974%
Flagler Master Fund SPC Ltd - acting for and on behalf of the class A segregated
portfolio $ 7,001,507 12.7300% Flagler Master Fund SPC Ltd - acting for and on
behalf of the class B segregated portfolio $ 4,000,000 7.2727% CIF Income
Partners (A), LLC $ 9,962,010 18.1127% Orange 2015 DisloCredit Fund, L.P. $
10,309,278 18.7441% Sainsbury’s Credit Opportunities Fund, Ltd. $ 1,288,660
2.3430% Total $ 55,000,000 100.0000%

 

 

 

 

   

 

 

EXHIBIT 1

 

TO SECURITY AGREEMENT

 

[FORM OF]
SECURITY AGREEMENT JOINDER

 

Reference is hereby made to that certain Security Agreement, dated as of
December [__], 2016 (the “Security Agreement”) by and among Pacific Ethanol,
Inc., a Delaware corporation (the “Company”), each Holder (as defined therein)
(each, a “Secured Party” and collectively, the “Secured Parties”) and Cortland
Capital Market Services LLC, as collateral agent for itself and the Secured
Parties (in such capacity, together with its successors and permitted assigns in
such capacity, the “Agent”). Capitalized terms used herein and not otherwise
defined herein shall have the meanings set forth in the Security Agreement.

 

The undersigned hereby agrees to be added as a party to the Security Agreement
as a “Secured Party”. The undersigned hereby unconditionally and irrevocably
expressly assumes, confirms and agrees to perform and observe as a Secured Party
each of the covenants, agreements, terms, conditions, obligations, duties,
promises and liabilities applicable to a “Secured Party” under the Security
Agreement (including, without limitation, those set forth in Section 17(f) of
the Security Agreement) as if it were an original signatory thereto.

 

The undersigned hereby agrees to promptly execute and deliver any and all
further documents and take such further action as the Agent may reasonably
require to effect the purpose of this Security Agreement Joinder.

 

This Security Agreement Joinder shall be governed by and construed in accordance
with the laws of the State of New York.

 

IN WITNESS WHEREOF, the undersigned Secured Party has caused this Security
Agreement Joinder to be executed by its officers or representatives as of
___________________, 20____.

[___________________________________]

 

By:____________________________________
Name: ________________________________
Title: ________________________________

 

 

 

Address of Secured Party:
___________________________________________________________

 

Email Address of Secured Party:
_______________________________________________________

 

Facsimile Number of Secured Party:
____________________________________________________