Exhibit 10.7


 





 


PLEDGE AND SECURITY AGREEMENT


 


 


THIS
PLEDGE AND SECURITY AGREEMENT (“Agreement”) is made as of this 26th day of March, 2009, by the undersigned (“Pledgor”)
in favor of Comerica Bank (“Bank”).


 


RECITALS


 


Pledgor
and Bank have entered into a Standby Letter of Credit Application and
Agreement dated as of August 1, 2005 (said agreement, as it may
hereafter be amended from time to time, being the “Master Agreement”)
pursuant to which Bank has agreed, subject to the terms and conditions set forth
in the Master Agreement, to extend certain credit facilities to Pledgor.
Pledgor has agreed to secure certain of its obligations with the money market
account or accounts described on attached Exhibit A (collectively, the “Money
Market Account”). Unless specifically defined in this Agreement, all
capitalized terms used herein shall have the meaning set forth in the Master
Agreement.


 


NOW,
THEREFORE, Pledgor and Bank agree as follows:


 


1.             Pledge
of Collateral.


 


(a)           Pledgor hereby pledges to Bank and
grants to Bank a security interest in the Money Market Account, together with
all proceeds thereof, all interest paid thereon, and all other cash and noncash
proceeds of the foregoing (all hereinafter called the “Pledged Collateral”),
as security for the prompt performance of all of Pledgor’s obligations (the “Obligation(s)”)
with respect to, or arising out of, the Master Agreement. Pledgor and Bank
hereby also confirm the existence and validity of any prior grant of a security
interest in the Pledged Collateral pursuant to the Master Agreement or any
other agreement previously entered into between the parties.


 


(b)           Pledgor authorizes Bank to file such
financing statements, and take such other actions as Bank determines from time
to time may be necessary or appropriate to perfect the security interest
granted hereunder.


 


(c)           Prior to the maturity (if any) of any
Pledged Collateral held by Bank pursuant hereto, Pledgor and Bank shall agree
upon a security or instrument similar in form, quality, and substance to the original
Pledged Collateral in which the proceeds of the Pledged Collateral can be
reinvested on maturity. Upon maturity of the Pledged Collateral in accordance
with its terms, or in the event the Pledged Collateral otherwise becomes
payable during the term of this Agreement, such maturing Pledged Collateral may
be presented for payment, exchange, or otherwise marketed by Bank on behalf of
Pledgor and the proceeds therefrom used to purchase the security or instrument
agreed to by Pledgor and Bank in accordance with the immediately preceding
sentence. If no agreement has been made, such proceeds shall be placed into an
interest bearing account offered by the Bank until such time as an agreement as
to the security replacing the original Pledged Collateral can be reached. Bank
may retain any such successor collateral and the proceeds therefrom as Pledged
Collateral in accordance with the terms of this Agreement.


 


(d)           The pledge of a security interest in
the Pledged Collateral hereunder remains in effect for the term of this
Agreement notwithstanding any release by Bank of any other collateral in
connection with the Master Agreement or any other agreement in effect between
the Bank and the Pledgor, now or hereafter arising.


 


2.             Representations,
Warranties and Covenants. Pledgor represents and warrants to and covenants
with Bank that:


 


(a)           The Pledged Collateral is owned by
Pledgor free and clear of any security interests, liens, encumbrances, options
or other restrictions created by Pledgor;


 


(b)           Pledgor has full power and authority
to create a first lien on the Pledged Collateral in favor of Bank and no
disability or contractual obligation exists that would prohibit Pledgor from
pledging the Pledged Collateral pursuant to this Agreement, and Pledgor will
not assign, create or permit to exist any other claim to, lien or encumbrance
upon, or security interest in any of the Pledged Collateral;


 


(c)           The Pledged Collateral is not the
subject of any present or threatened suit, action, arbitration, administrative
or other proceeding, and Pledgor knows of no reasonable grounds for the
institution of any such proceedings; and


 


(d)           Pledgor shall not transfer, encumber,
dispose of, withdraw, or otherwise direct the payment of any proceeds,
interest, or amounts payable with respect to the Pledged Collateral for so long
as it is subject to this Agreement.


 


All
the above representations and warranties shall survive the making of this
Agreement.


 


 


1

















 


3.             Events of Default. Each of
the following shall constitute an event of default (“Event of Default”)
hereunder:


 


(a)           The occurrence and continuance of an
Event of Default under the Master Agreement; or


 


(b)           The breach of any provision of this
Agreement by Pledgor or the failure by Pledgor to observe or perform any of the
provisions of this Agreement.


 


4.             Bank’s Remedies Upon Default.


 


Upon
the occurrence of an Event of Default, Bank shall have the right to exercise
all such rights as a secured party under the California Uniform Commercial Code
as it, in its sole judgment, shall deem necessary or appropriate. After the
disposal of any of the Pledged Collateral, Bank may deduct all reasonable legal
and other expenses and attorney’s fees for protecting its interests and
enforcing its remedies under the Master Agreement and this Agreement and shall
apply the residue of the proceeds to, or hold as a reserve against, the
Obligations in such manner as Bank in its sole discretion shall determine, and
shall pay the balance, if any, to Pledgor or otherwise, in accordance with
applicable law.


 


5.             Waivers; Indemnification.


 


(a)           Demand; Protest. Except as
otherwise provided in this Agreement, Pledgor waives demand, protest, notice of
protest, notice of default or dishonor, notice of payment and nonpayment and
any other notices relating to the Obligations.


 


(b)           Indemnification. Pledgor
agrees to defend, indemnify and hold harmless Bank and its officers, employees,
and affiliates against all losses or expenses in any way suffered, incurred, or
paid by Bank as a result of or in any way arising out of, following, or
consequential to transactions between Bank and Pledgor, under this Agreement
(including without limitation reasonable attorneys’ fees and expenses), except
for losses caused by Bank’s gross negligence or willful misconduct.


 


6.             Notices. Unless otherwise
later agreed to in writing, all notices or demands by any party regarding this
Agreement shall be in writing and shall be personally delivered or sent by
certified mail, postage prepaid, return receipt requested, or by telefacsimile
to Pledgor or to Bank, as the case may be, at its addresses set forth in the
Master Agreement, with a copy of such document sent to the Bank’s account
officer at the following address: 11921 Freedom Drive, Ste 920, Reston, VA
20190 Mail Code:  5270.


 


7.             Choice of Law and Venue; Jury
Trial Waiver. This Agreement shall be governed by, and construed in
accordance with, the internal laws of the State of California, without regard
to principles of conflicts of laws. Each of Pledgor and Bank hereby submits to
the exclusive jurisdiction of the state and Federal courts located in
California. THE UNDERSIGNED ACKNOWLEDGE THAT THE RIGHT TO TRIAL BY JURY IS A
CONSTITUTIONAL ONE, BUT THAT IT MAY BE WAIVED UNDER CERTAIN CIRCUMSTANCES.
TO THE EXTENT PERMITTED BY LAW, EACH PARTY, AFTER CONSULTING (OR HAVING HAD THE
OPPORTUNITY TO CONSULT) WITH COUNSEL OF ITS, HIS OR HER CHOICE, KNOWINGLY AND
VOLUNTARILY, AND FOR THE MUTUAL BENEFIT OF ALL PARTIES, WAIVES ANY RIGHT TO
TRIAL BY JURY IN THE EVENT OF LITIGATION ARISING OUT OF OR RELATED TO THIS
AGREEMENT OR ANY OTHER DOCUMENT, INSTRUMENT OR AGREEMENT BETWEEN THE
UNDERSIGNED PARTIES.


 


8.             General Provisions.


 


(a)           Successors and Assigns. This
Agreement shall bind and inure to the benefit of the respective successors and
permitted assigns of each of the parties; provided, however, that neither this
Agreement nor any rights hereunder may be assigned by Pledgor without Bank’s
prior written consent, which consent may be granted or withheld in Bank’s sole
discretion. Bank shall have the right without the consent of or notice to
Pledgor to sell, transfer, negotiate, or grant participation in all or any part
of, or any interest in, Bank’s obligations, rights and benefits hereunder.


 


(b)           Time of Essence. Time is of
the essence for the performance of all obligations set forth in this Agreement.


 


(c)           Severability of Provisions.
Each provision of this Agreement shall be severable from every other provision
of this Agreement for the purpose of determining the legal enforceability of
any specific provision.


 


(d)           Amendments in Writing, Integration.
This Agreement cannot be amended or terminated orally. All prior agreements,
understandings, representations, warranties, and negotiations between the
parties hereto with respect to the subject matter of this Agreement, if any,
are merged into this Agreement and with any other written agreement concerning
the Obligations previously entered into by the parties.


 


(e)           Counterparts. This Agreement
may be executed in any number of counterparts and by different parties on
separate counterparts, each of which, when executed and delivered, shall be deemed
to be an original, and all of which, when taken together, shall constitute but
one and the same Agreement.


 


 


2

















 


(f)            Survival. All covenants, representations and
warranties made in this Agreement shall continue in full force and effect so
long as any Obligations remain outstanding. The obligations of Pledgor to
indemnify Bank with respect to the expenses, damages, losses, costs and
liabilities described in Section 5(b) shall survive until all
applicable statute of limitations periods with respect to actions that may be
brought against Bank have run.


 


(g)           Term. This Agreement shall remain in effect so
long as any Obligation, whether or not contingent or unliquidated, now or
hereafter arising, remains in existence.


 


IN
WITNESS WHEREOF, the parties hereto have executed this Agreement the day and
year first above written.


 




	
   

  	
  Bank:

  
	
   

  	
   

  
	
   

  	
  Comerica Bank 

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Todd Mc Donald

  
	
   

  	
  Title:

  	
  Senior Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Pledgor:

  
	
   

  	
   

  
	
   

  	
  Clarient, Inc.,

  a Delaware corporation

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Raymond Land

  
	
   

  	
  Title:

  	
  Senior Vice President and CFO

  






 


 


3

















 


EXHIBIT A


 


Money
Market Account No. 1894162872, held at Comerica Bank, in an amount equal
to at least 100% of the obligations under the Master Agreement, in the name of
Clarient, Inc. and any and all subsequent replacements thereof.


 


 


4

















 





 


 


March 26,
2009


 


 


Clarient, Inc.


31 Columbia


Aliso Viejo, CA
92656


 


This
Letter Agreement is entered into by and between Comerica Bank (“Bank”) and the
undersigned party as of this 26th day of March, 2009.


 


The
undersigned and Bank agree that the following Reference Provision shall be made
a part of any agreement, instrument, or document made or entered into by the
undersigned with or in favor of Bank (collectively, the “Agreement”) and is
hereby incorporated into any such Agreement by this reference.


 


Reference Provision.


 


a.             In the event that the Jury Trial
Waiver provision contained in the Agreement is not enforceable, the parties
elect to proceed under this Reference Provision.


 


b.             With the exception of the items
specified in clause (c), below, any controversy, dispute or claim (each, a “Claim”)
between the parties arising out of or relating to the Agreement will be
resolved by a reference proceeding in California in accordance with the
provisions of Section 638 et seq. of the
California Code of Civil Procedure (“CCP”), or their successor sections, which
shall constitute the exclusive remedy for the resolution of any Claim,
including whether the Claim is subject to the reference proceeding. Except as
otherwise provided in the Agreement, venue for the reference proceeding will be
in the state or federal court in the county or district where venue is
otherwise appropriate under applicable law (the “Court”).


 


c.             The matters that shall not be
subject to a reference are the following: (i) foreclosure of any security
interests in real or personal property, (ii) exercise of self-help
remedies (including, without limitation, set-off), (iii) appointment of a
receiver and (iv) temporary, provisional or ancillary remedies (including,
without limitation, writs of attachment, writs of possession, temporary
restraining orders or preliminary injunctions). This Agreement does not limit
the right of any party to exercise or oppose any of the rights and remedies
described in clauses (i) and (ii) or to seek or oppose from a court
of competent jurisdiction any of the items described in clauses (iii) and
(iv). The exercise of, or opposition to, any of those items does not waive the
right of any party to a reference pursuant to this Agreement.


 


d.             The referee shall be a retired
judge or justice selected by mutual written agreement of the parties. If the
parties do not agree within ten (10) days of a written request to do so by
any party, then, upon request of any party, the referee shall be selected by
the Presiding Judge of the Court (or his or her representative). A request for
appointment of a referee may be heard on an ex parte or
expedited basis, and the parties agree that irreparable harm would result if ex parte relief is not granted. Pursuant to CCP § 170.6,
each party shall have one peremptory challenge to the referee selected by the
Presiding Judge of the Court (or his or her representative).


 


e.             The parties agree that time is of
the essence in conducting the reference proceedings. Accordingly, the referee
shall be requested, subject to change in the time periods specified herein for
good cause shown, to (a) set the matter for a status and trial-setting
conference within fifteen (15) days after the date of selection of the referee,
(b) if practicable, try all issues of law or fact within one hundred
twenty (120) days after the date of the conference and (c) report a
statement of decision within twenty (20) days after the matter has been
submitted for decision.


 


f.              The referee will have power to
expand or limit the amount and duration of discovery. The referee may set or
extend discovery deadlines or cutoffs for good cause, including a party’s
failure to provide requested discovery for any reason whatsoever. Unless
otherwise ordered, no party shall be entitled to “priority” in conducting
discovery, depositions may be taken by either party upon seven (7) days
written notice, and all other discovery shall be responded to within fifteen
(15) days after service. All disputes relating to discovery which cannot be
resolved by the parties shall be submitted to the referee whose decision shall
be final and binding.


 


g.             Except as expressly set forth in
this Agreement, the referee shall determine the manner in which the reference
proceeding is conducted including the time and place of hearings, the order of
presentation of evidence, and all other questions that arise with respect to
the course of the reference proceeding. All proceedings and hearings conducted
before the referee, except for trial, shall be conducted without a court
reporter, except that when any party so requests, a court reporter will be used
at any hearing conducted before the referee, and the referee will be provided a
courtesy copy of the transcript. The party making such a request shall have the
obligation to arrange for and pay the court reporter. Subject to the referee’s
power to award costs to the prevailing party, the parties will equally share
the cost of the referee and the court reporter at trial.


 


 

















 


h.             The referee shall be required to determine
all issues in accordance with existing case law and the statutory laws of the
State of California. The rules of evidence applicable to proceedings at
law in the State of California will be applicable to the reference proceeding.
The referee shall be empowered to enter equitable as well as legal relief,
enter equitable orders that will be binding on the parties and rule on any
motion which would be authorized in a trial, including without limitation
motions for summary judgment or summary adjudication. The referee shall issue a
decision at the close of the reference proceeding which disposes of all claims
of the parties that are the subject of the reference. Pursuant to CCP § 644,
such decision shall be entered by the Court as a judgment or an order in the
same manner as if the action had been tried by the Court and any such decision
will be final, binding and conclusive. The parties reserve the right to appeal
from the final judgment or order or from any appealable decision or order
entered by the referee. The parties reserve the right to findings of fact,
conclusions of laws, a written statement of decision, and the right to move for
a new trial or a different judgment, which new trial, if granted, is also to be
a reference proceeding under this provision.


 


i.              If the enabling legislation which
provides for appointment of a referee is repealed (and no successor statute is
enacted), any dispute between the parties that would otherwise be determined by
reference procedure will be resolved and determined by arbitration. The
arbitration will be conducted by a retired judge or Justice, in accordance with
the California Arbitration Act §1280 through §1294.2 of the CCP as amended from
time to time. The limitations with respect to discovery set forth above shall
apply to any such arbitration proceeding.


 


j.              THE PARTIES RECOGNIZE AND AGREE
THAT ALL DISPUTES RESOLVED UNDER THIS REFERENCE PROVISION WILL BE DECIDED BY A
REFEREE AND NOT BY A JURY. AFTER CONSULTING (OR HAVING HAD THE OPPORTUNITY TO
CONSULT) WITH COUNSEL OF THEIR OWN CHOICE, EACH PARTY KNOWINGLY AND
VOLUNTARILY, AND FOR THE MUTUAL BENEFIT OF ALL PARTIES, AGREES THAT THIS
REFERENCE PROVISION WILL APPLY TO ANY CONTROVERSY, DISPUTE OR CLAIM BETWEEN OR
AMONG THEM WHICH ARISES OUT OF OR IS RELATED TO THE AGREEMENT.


 


COMERICA
BANK


 




	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Todd Mc Donald

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
  Senior Vice President

  	
   

  	
   

  






 


CLARIENT,
INC.,


a Delaware
corporation


 




	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Raymond Land

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
  Senior Vice President and CFO