laws of the United States or any other country, whether as author, assignee, transferee orotherwise, and (b) all registrations and applications for registration of any such copyright in theUnited States or any other country, including registrations, recordings, supplemental registrationsand pending applications for registration in the United States Copyright Office (or any successoroffice or any similar office in any other country), including those listed on Schedule III.          ***“Equity Interests”***shall mean shares of capital stock, partnership interests in a limitedliability company, beneficial interests in a trust or other equity ownership interests in a person,and any warrants, options or other rights entitling the holder thereof to purchase or acquire anysuch Equity Interest.          “***Federal Securities Laws***” shall have the meaning assigned to such term in Section 5.04.          “***General Intangibles***” shall mean all choses in action and causes of action and all otherintangible personal property of any Grantor of every kind and nature (other than Accounts) nowowned or hereafter acquired by any Grantor, including all rights and interests in partnerships,limited partnerships, limited liability companies and other unincorporated entities, corporate orother business records, indemnification claims, contract rights (including rights under leases,whether entered into as lessor or lessee, Hedging Agreements and other agreements), IntellectualProperty, goodwill, registrations, franchises, tax refund claims and any letter of credit,guarantee, claim, security interest or other security held by or granted to any Grantor to securepayment by an Account Debtor of any of the Accounts.          “***Grantors***” shall mean the Issuer and the Guarantors.          “***Guarantor***” shall mean (a) the Subsidiaries identified on Schedule I hereto as Guarantors and(b) each other Subsidiary that becomes a party to this Agreement as a Guarantor after the ClosingDate.          “***Intellectual Property***” shall mean all intellectual and similar property of any Grantor ofevery kind and nature now owned or hereafter acquired by any Grantor, including inventions,designs, Patents, Copyrights, Licenses, Trademarks, trade secrets, confidential or proprietarytechnical and business information, know-how, show-how or other data or information, software anddatabases and all embodiments or fixations thereof and related documentation, registrations andfranchises, and all additions, improvements and accessions to, and books and records describing orused in connection with, any of the foregoing.          “***License***” shall mean any Patent License, Trademark License, Copyright License or other licenseor sublicense agreement relating to Intellectual Property to which any Grantor is a party,including those listed on Schedule III.          “***New York UCC***” shall mean the Uniform Commercial Code as from time to time in effect in theState of New York.
 

 
          “***Obligations***” shall mean Issuer’s obligations under the Settlement Agreement.          “***Patents***” shall mean all of the following now owned or hereafter acquired by any Grantor:(a) all letters patent of the United States or the equivalent thereof in any other country, allregistrations and recordings thereof, and all applications for letters patent of the United Statesor the equivalent thereof in any other country, including registrations, recordings and pendingapplications in the United States Patent and Trademark Office (or any successor or any similaroffices in any other country), including those listed on Schedule III, and (b) all reissues,continuations, divisions, continuations-in-part, renewals or extensions thereof, and the inventionsdisclosed or claimed therein, including the right to make, use and/or sell the inventions disclosedor claimed therein.          “***Pledged Notes***” shall mean all promissory notes listed on Schedule II, all promissory notes inrespect of intercompany debt at any time issued to any Guarantor and all other promissory notesissued to or held by any Guarantor (other than promissory notes issued in connection withextensions of trade credit by any Guarantor in the ordinary course of business.)          “***Pledged Securities***” shall mean (a) the Equity Interests described or referred to in ScheduleII (as the same may be supplemented from time to time); (b)(i) the certificates or instruments, ifany, representing such Equity Interests, (ii) all dividends (cash, Equity Interests or otherwise),cash, instruments, rights to subscribe, purchase or sell and all other rights and property fromtime to time received, receivable or otherwise distributed in respect of or in exchange for any orall of such securities, (iii) all replacements, additions to and substitutions for any of theproperty referred to in this definition, including, without limitation, claims against thirdparties, (iv) any other Collateral constituting securities, (v) the proceeds, interest and otherincome of or on any of the property referred to in this definition, (vi) all security entitlementsin respect of any of the foregoing, if any and (vii) all books and records relating to any of theproperty referred to in this definition and (c) the Pledged Notes.          “***Security Interest***” shall have the meaning assigned to such term in Section 3.01.          “***Trademarks***” shall mean all of the following now owned or hereafter acquired by any Grantor:(a) all trademarks, service marks, trade names, corporate names, company names, business names,fictitious business names, trade styles, trade dress, logos, other source or business identifiers,designs and general intangibles of like nature, now existing or hereafter adopted or acquired, allregistrations and recordings thereof, and all registration and recording applications filed inconnection therewith, including registrations and registration applications in the United StatesPatent and Trademark Office (or any successor office) or any similar offices in any State of theUnited States or any other country or any political subdivision thereof, and all extensions orrenewals thereof, including those listed on Schedule III, (b) all goodwill associated
 

 
therewith or symbolized thereby and (c) all other assets, rights and interests that uniquelyreflect or embody such goodwill.          “***Transaction Documents***” shall mean this Agreement, the Settlement Agreement and theSubordination.ARTICLE II***Guarantee***          SECTION 2.01. ***Guarantee.***Subject to the prior guarantees to the Lenders pursuant to theSecurities Purchase Agreement and the rights of the Lenders pursuant to the Subordination, eachGuarantor unconditionally guarantees, jointly with the other Guarantors and severally, as a primaryobligor and not merely as a surety, the due and punctual payment and performance of theObligations. Each Guarantor further agrees that the Obligations may be extended or renewed, inwhole or in part, without notice to or further assent from it, and that it will remain bound uponits guarantee notwithstanding any extension or renewal of any Obligation. Each Guarantor waivespresentment to, demand of payment from and protest to the Issuer of any Obligation, and also waivesnotice of acceptance of its guarantee and notice of protest for nonpayment.          SECTION 2.02. ***Guarantee of Payment.***Each Guarantor further agrees that its guaranteehereunder constitutes a guarantee of payment when due and not of collection, and waives any rightto require that any resort be had by Notemachine to any security held for the payment of theObligations.          SECTION 2.03. ***No Limitations, Etc.***(a) Except for termination of a Guarantor’s obligationshereunder as expressly provided in Section 7.16, the obligations of each Guarantor hereunder shallnot be subject to any reduction, limitation, impairment or termination for any reason, includingany claim of waiver, release, surrender, alteration or compromise, and shall not be subject to anydefense or setoff, counterclaim, recoupment or termination whatsoever by reason of the invalidity,illegality or unenforceability of the Obligations or otherwise. Without limiting the generality ofthe foregoing, the obligations of each Guarantor hereunder shall not be discharged or impaired orotherwise affected by (i) the failure of Notemachine to assert any claim or demand or to enforceany right or remedy under the provisions of any Transaction Document or otherwise, (ii) anyrescission, waiver, amendment or modification of, or any release from any of the terms orprovisions of, any Transaction Document or any other agreement, including with respect to any otherGuarantor under this Agreement, (iii) the release of, or any impairment of or failure to perfectany Lien on or security interest in, any security held by Notemachine for the Obligations, (iv) anydefault, failure or delay, willful or otherwise, in the performance of the Obligations or (v) anyother act or omission that may or might in any manner or to any extent vary the risk of anyGuarantor or otherwise operate as a discharge of any Guarantor as a matter of law or equity (otherthan the indefeasible payment in full in cash of all the Obligations). Each Guarantor expresslyauthorizes Notemachine to take and hold security for the payment and
 

 
performance of the Obligations, to exchange, waive or release any or all such security (withor without consideration), to enforce or apply such security and direct the order and manner of anysale thereof in its sole discretion or to release or substitute any one or more other guarantors orobligors upon or in respect of the Obligations, all without affecting the obligations of anyGuarantor hereunder.          (b) To the fullest extent permitted by applicable law, each Guarantor waives any defense basedon or arising out of any defense of the Issuer or any other Guarantor or the unenforceability ofthe Obligations or any part thereof from any cause, or the cessation from any cause of theliability of the Issuer or any other Guarantor, other than the indefeasible payment in full in cashof all the Obligations. Notemachine may, at its election, foreclose on any security held by it byone or more judicial or nonjudicial sales, accept an assignment of any such security in lieu offoreclosure, compromise or adjust any part of the Obligations, make any other accommodation withthe Issuer or any other Guarantor or exercise any other right or remedy available to it against theIssuer or any other Guarantor, without affecting or impairing in any way the liability of anyGuarantor hereunder except to the extent the Obligations have been fully and indefeasibly paid infull in cash. To the fullest extent permitted by applicable law, each Guarantor waives any defensearising out of any such election even though such election operates, pursuant to applicable law, toimpair or to extinguish any right of reimbursement or subrogation or other right or remedy of suchGuarantor against the Issuer or any other Guarantor, as the case may be, or any security.          SECTION 2.04. ***Reinstatement.***Each Guarantor agrees that its guarantee hereunder shallcontinue to be effective or be reinstated, as the case may be, if at any time payment, or any partthereof, of any Obligation is rescinded or must otherwise be restored by Notemachine upon thebankruptcy or reorganization of the Issuer, any other Guarantor or otherwise.ARTICLE III***Security Interests in Personal Property***          SECTION 3.01. ***Security Interest.***Subject to the prior collateral assignment and pledge of theCollateral to the Lenders pursuant to the Securities Purchase Agreement and the rights of theLenders pursuant to the Subordination, (a)  as security for the payment or performance, as the casemay be, in full of the Obligations, each Grantor hereby assigns and pledges to Notemachine, itssuccessors and assigns, and hereby grants to Notemachine, its successors and assigns, a securityinterest (the “***Security Interest***”), in all right, title or interest in or to any and all of thefollowing assets and properties now owned or at any time hereafter acquired by such Grantor or inwhich such Grantor now has or at any time in the future may acquire any right, title or interest(collectively, the “***Collateral***”):     (i) all Pledged Securities;
 

 
     (ii) all Accounts;     (iii) all Chattel Paper;     (iv) all cash and Deposit Accounts;     (v) all Documents;     (vi) all Equipment;     (vii) all Fixtures;     (viii) all General Intangibles;     (ix) all Instruments;     (x) all Inventory;     (xi) all Investment Property;     (xii) all Letter-of-Credit Rights;     (xiii) all Commercial Tort Claims;     (xiv) all books and records pertaining to the Collateral; and     (xv) to the extent not otherwise included, all Proceeds and products of anyand all of the foregoing and all collateral security and guarantees given by anyperson with respect to any of the foregoing;provided, however, that the Collateral shall not include, and in no event shall thesecurity interest granted under this Section 4.01 attach to (A) any lease, license,contract, property rights or agreement to which any Grantor is a party (or to any of its rights orinterests thereunder) if the grant of such security interest would constitute or result in either(x) the abandonment, invalidation or unenforceability of any right, title or interest of anyGrantor therein or (y) in a breach or termination pursuant to the terms of, or a default under, anysuch lease, license, contract, property rights or agreement (other than, in each case, to theextent that any such term would be rendered ineffective pursuant to Sections 9-406,9-407, 9-408 or 9-409 of the UCC, any provision of the Bankruptcy Code orotherwise), (B) any Grantor’s directors and officers liability insurance policies, or (C) anyapplication for registration of a trademark filed with the United States Patent and TrademarkOffice on an intent-to-use basis until such time (if any) as a statement of use or amendment toallege use is filed, at which time such trademark shall automatically become part of the Collateraland subject to the security interest pledged.          (b) Subject to the Subordination, each Grantor hereby irrevocably authorizes Notemachine atany time and from time to time to file in any relevant jurisdiction any initial financingstatements (including fixture filings) with respect to the
 

 
Collateral or any part thereof and amendments thereto that (i) indicate the Collateral as “allassets” of such Grantor or words of similar effect, and (ii) contain the information required byArticle 9 of the Uniform Commercial Code of each applicable jurisdiction for the filing of anyfinancing statement or amendment, including (A) whether such Grantor is an organization, the typeof organization and any organizational identification number issued to such Grantor and (B) in thecase of a financing statement filed as a fixture filing, a sufficient description of the realproperty to which such Collateral relates. Each Grantor agrees to provide such information toNotemachine promptly upon request.          (c) After the termination of the Securities Purchase Agreement and Subordination, the Borrowershall deliver to deliver any Collateral consisting of Pledged Securities to Notemachine, togetherwith stock powers executed in blank, and such Collateral shall be held by Notemachine until thefull payment of all amounts due to Lender under the Settlement Agreement or the termination orexpiration of this Agreement.          (d) The Security Interest is granted as security only and shall not subject Notemachine to, orin any way alter or modify, any obligation or liability of any Grantor with respect to or arisingout of the Collateral.          SECTION 3.02. ***Representations and Warranties.***The Grantors jointly and severally representand warrant to Notemachine that:          (a) Subject to the Subordination, each Grantor has good and valid rights in and titleto the Collateral with respect to which it has purported to grant a Security Interesthereunder and has full power and authority to grant to Notemachine the Security Interest insuch Collateral pursuant hereto and to execute, deliver and perform its obligations inaccordance with the terms of this Agreement, without the consent or approval of any otherperson other than any consent or approval that has been obtained.          (b) Listed on Schedule I is each Grantor’s (i) legal name and address, (ii) identity ortype of organization or corporate structure, (iii) Federal Taxpayer Identification Numberand organizational identification number, and (iv) jurisdiction of organization.          (c) The Security Interest constitutes (i) a legal and valid second lien securityinterest in all Collateral securing the payment and performance of the Obligations and (ii)a perfected second lien security interest in all Collateral in which a security interest maybe perfected by filing, recording or registering a financing statement or analogous documentin the United States (or any political subdivision thereof) pursuant to the UniformCommercial Code or other applicable law in such jurisdictions. The Security Interest is andshall be prior to any other Lien on any of the Collateral, other than Liens expresslypermitted under the Securities Purchase Agreement that have priority as a matter of law.
 

 
          SECTION 3.03. ***Covenants.***(a) Each Grantor agrees promptly to notify Notemachine in writing ofany change in (i) its legal name and/or address, (ii) its identity or type of organization orcorporate structure, (iii) its Federal Taxpayer Identification Number or organizationalidentification number or (iv) its jurisdiction of organization. Each Grantor agrees promptly toprovide Notemachine with certified copies of organizational documents reflecting any of the changesdescribed in the first sentence of this paragraph. Each Grantor agrees not to effect or permit anychange referred to in the preceding sentence unless all filings have been made (or concurrentlywill be made) under the Uniform Commercial Code or otherwise that are required in order forNotemachine to continue at all times following such change to have a valid, legal and perfectedsecond priority security interest in all the Collateral. Each Grantor agrees promptly to notifyNotemachine if any material portion of the Collateral owned or held by such Grantor is damaged ordestroyed.          (b) Subject to the rights of the Lenders under the Securities Purchase Agreement and theSubordination, each Grantor shall, at its own expense, use commercially reasonable efforts todefend title to the Collateral against all persons and to defend the Security Interest ofNotemachine in the Collateral and the priority thereof against any Lien not expressly permittedpursuant hereto or the Settlement Agreement.          (c) Subject to the Subordination, each Grantor agrees, at its own expense, promptly toexecute, acknowledge, deliver and cause to be duly filed all such further instruments and documentsand take all such actions as Notemachine may from time to time reasonably request to better assure,obtain, preserve, protect and perfect the Security Interest and the rights and remedies createdhereby, including the payment of any fees and Taxes required in connection with the execution anddelivery of this Agreement, the granting of the Security Interest and the filing of any financingor continuation statements (including fixture filings) or other documents in connection herewith ortherewith.          (d) Each Grantor shall remain liable to observe and perform all the conditions and obligationsto be observed and performed by it under each contract, agreement or instrument relating to theCollateral, all in accordance with the terms and conditions thereof, and each Grantor jointly andseverally agrees to indemnify and hold harmless Notemachine from and against any and all liabilityfor such performance.ARTICLE IV***Events of Defaults and Remedies***          SECTION 4.01. ***Events of Default.***Each of the following will be an “Event of Default” underthis Agreement:          (a) The Issuer shall fail to pay, when due, any amounts due under the Settlement Agreement;
 

 
          (b) Any representation or warranty contained in this Agreement, the Settlement Agreement orin any documents, certificate or instrument provided in connection with the Settlement Agreementshall prove to be untrue in any material respect;          (c) Any Grantor shall fail to perform any obligation under this Agreement, the SettlementAgreement or any related agreement between any Grantor and Notemachine;          (d) if any obligation of any Grantor in respect of any indebtedness for borrowed money, inan aggregate principal amount exceeding $250,000, shall be declared to be or shall become due andpayable prior to its stated maturity or such obligation shall not be paid as and when the samebecomes due and payable; or there shall occur any event or condition which constitutes an event ofdefault under any mortgage, indenture, instrument, agreement or evidence of indebtedness forborrowed money relating to any obligation of any Borrower in respect of any such indebtedness theeffect of which is to permit the holder or the holders of such mortgage, indenture, instrument,agreement or evidence of such indebtedness, or a trustee, agent or other representative on behalfof such holder or holders, to cause such indebtedness evidenced thereby to become due prior to itsstated maturity;          (e) If any Grantor shall cease to be solvent, make an assignment for the benefit of itscreditors, call a meeting of its creditors to obtain any general financial accommodation, suspendbusiness or if any case under any provision of the United States Bankruptcy Code or similar statuteincluding provisions for reorganizations, shall be commenced by or against such entity or if areceiver, trustee or equivalent officer shall be appointed for all or any of the properties of suchperson;          (f) if any federal or state tax lien is filed of record against any Grantor and is notbonded or discharged within ten (10) days of filing; and          (g) If a judgment or judgments in the aggregate amount of Two Hundred Fifty Thousand and00/100 Dollars ($250,000.00) shall be entered against any Grantor in any action or proceeding andshall not be stayed, vacated, bonded, paid or discharged within thirty (30) days of entry, except ajudgment where the claim is fully covered by insurance and the insurance company has acceptedliability therefore in writing.          SECTION 4.02. ***Remedies Upon Default.***Upon the occurrence and during the continuance of an Event ofDefault and subject to the Subordination, all Obligations shall immediately become due and owingand each Grantor agrees to deliver each item of Collateral to Notemachine on demand, and it isagreed that Notemachine shall have the right to take any of or all the following actions at thesame or different times, with or without legal process and with or without prior notice or demandfor performance, to take possession of the Collateral and without liability for trespass to enterany premises where the Collateral may be located for the purpose of taking possession of orremoving the Collateral and, generally, to exercise any and all rights afforded to a secured partyunder the Uniform Commercial Code or other applicable law. Without limiting the generality of theforegoing, each Grantor agrees that Notemachine shall have
 

 
the right, subject to the mandatory requirements of applicable law, to sell or otherwise dispose ofall or any part of the Collateral at a public (with the exception of the Pledged Securities thatare Equity Interests) or private sale or at any broker’s board or on any securities exchange, forcash, upon credit or for future delivery as Notemachine shall deem appropriate. Notemachine shallbe authorized at any such sale (if it deems it advisable to do so) to restrict the prospectivebidders or Notemachines to persons who will represent and agree that they are purchasing theCollateral for their own account for investment and not with a view to the distribution or salethereof, and upon consummation of any such sale Notemachine shall have the right to assign,transfer and deliver to Notemachine or Notemachines thereof the Collateral so sold. Each suchNotemachine at any such sale shall hold the property sold absolutely, free from any claim or righton the part of any Grantor, and each Grantor hereby waives (to the extent permitted by law) allrights of redemption, stay and appraisal which such Grantor now has or may at any time in thefuture have under any rule of law or statute now existing or hereafter enacted.          Notemachine shall give each applicable Grantor 10 days’ written notice (which each Grantoragrees is reasonable notice within the meaning of Section 9-611 of the New York UCC or itsequivalent in other jurisdictions) of Notemachine’s intention to make any sale of Collateral. Suchnotice, in the case of a public sale, shall state the time and place for such sale and, in the caseof a sale at a broker’s board or on a securities exchange, shall state the board or exchange atwhich such sale is to be made and the day on which the Collateral, or portion thereof, will firstbe offered for sale at such board or exchange. Any such public sale shall be held at such time ortimes within ordinary business hours and at such place or places as Notemachine may fix and statein the notice (if any) of such sale. At any such sale, the Collateral, or portion thereof, to besold may be sold in one lot as an entirety or in separate parcels, as Notemachine may (in its soleand absolute discretion) determine. Notemachine shall not be obligated to make any sale of anyCollateral if it shall determine not to do so, regardless of the fact that notice of sale of suchCollateral shall have been given. Notemachine may, without notice or publication, adjourn anypublic or private sale or cause the same to be adjourned from time to time by announcement at thetime and place fixed for sale, and such sale may, without further notice, be made at the time andplace to which the same was so adjourned. In case any sale of all or any part of the Collateral ismade on credit or for future delivery, the Collateral so sold may be retained by Notemachine untilthe sale price is paid by Notemachine or Notemachines thereof, but Notemachine shall not incur anyliability in case any such Notemachine or Notemachines shall fail to take up and pay for theCollateral so sold and, in case of any such failure, such Collateral may be sold again upon likenotice. At any public (or, to the extent permitted by law, private) sale made pursuant to thisAgreement, any Secured Party may bid for or purchase, free (to the extent permitted by applicablelaw) from any right of redemption, stay, valuation or appraisal on the part of any Grantor (allsaid rights being also hereby waived and released to the extent permitted by applicable law), theCollateral or any part thereof offered for sale and may make payment on account thereof by usingany claim then due and payable to such Secured Party from any Grantor as a credit against thepurchase price, and such Secured Party may, upon compliance with the terms of sale, hold, retainand dispose of
 

 
such property without further accountability to any Grantor therefor. For purposes hereof, awritten agreement to purchase the Collateral or any portion thereof shall be treated as a salethereof; Notemachine shall be free to carry out such sale pursuant to such agreement and no Grantorshall be entitled to the return of the Collateral or any portion thereof subject thereto,notwithstanding the fact that after Notemachine shall have entered into such an agreement allEvents of Default shall have been remedied and the Obligations paid in full. As an alternative toexercising the power of sale herein conferred upon it, Notemachine may proceed by a suit or suitsat law or in equity to foreclose this Agreement and to sell the Collateral or any portion thereofpursuant to a judgment or decree of a court or courts having competent jurisdiction or pursuant toa proceeding by a court-appointed receiver. Any sale pursuant to the provisions of thisSection 5.01 shall be deemed to conform to the commercially reasonable standards as provided inSection 9-610(b) of the New York UCC or its equivalent in other jurisdictions.          SECTION 4.03. ***Application of Proceeds.***Notemachine shall apply the proceeds of anycollection, sale, foreclosure or other realization upon any Collateral, including any Collateralconsisting of cash, as follows:     FIRST, to the payment of all costs and expenses incurred by Notemachine in connectionwith such collection, sale, foreclosure or realization or otherwise in connection with thisAgreement, any other Transaction Document or any of the Obligations, including all courtcosts and the fees and expenses of its agents and legal counsel, the repayment of alladvances made by Notemachine hereunder on behalf of any Grantor and any other costs orexpenses incurred in connection with the exercise of any right or remedy hereunder;     SECOND, to the payment in full of all other Obligations;     THIRD, to the Grantors, their successors or assigns, or as a court of competentjurisdiction may otherwise direct.          SECTION 4.04. ***Grant of License to Use Intellectual Property.***For the purpose of enablingNotemachine to exercise rights and remedies under this Agreement at such time as Notemachine shallbe lawfully entitled to exercise such rights and remedies, each Grantor hereby grants toNotemachine an irrevocable, nonexclusive license (exercisable without payment of royalty or othercompensation to the Grantors), to use, license or sublicense any of the Collateral consisting ofIntellectual Property now owned or hereafter acquired by such Grantor, and wherever the same may belocated, and including in such license access to all media in which any of the licensed items maybe recorded or stored and to all computer software and programs used for the compilation orprintout thereof, subject, in the case of Trademarks, to the observance of standards of quality andinspection in connection with the use of such Trademarks as are sufficient to maintain the validityand enforceability of such Trademarks. The use of such license by Notemachine may be exercised, atthe option of Notemachine, only upon the occurrence and during the continuation of an Event ofDefault; *provided*, *however*, that any license, sublicense or other transaction entered into byNotemachine in accordance herewith shall
 

 
be binding upon each Grantor notwithstanding any subsequent cure of an Event of Default.          SECTION 4.05. ***Securities Act, Etc.***In view of the position of the Grantors in relation to thePledged Collateral, or because of other current or future circumstances, a question may arise underthe U.S. Securities Act of 1933, as now or hereafter in effect, or any similar statute hereafterenacted analogous in purpose or effect (such Act and any such similar statute as from time to timein effect being called the “***Federal Securities Laws***”) with respect to any disposition of thePledged Collateral permitted hereunder. Each Grantor understands that compliance with the FederalSecurities Laws might very strictly limit the course of conduct of Notemachine if Notemachine wereto attempt to dispose of all or any part of the Pledged Collateral, and might also limit the extentto which or the manner in which any subsequent transferee of any Pledged Collateral could disposeof the same. Similarly, there may be other legal restrictions or limitations affecting Notemachinein any attempt to dispose of all or part of the Pledged Collateral under applicable “blue sky” orother state securities laws or similar laws analogous in purpose or effect. Each Grantorrecognizes that in light of such restrictions and limitations Notemachine may, with respect to anysale of the Pledged Collateral, limit Notemachines to those who will agree, among other things, toacquire such Pledged Collateral for their own account, for investment, and not with a view to thedistribution or resale thereof. Each Grantor acknowledges and agrees that in light of suchrestrictions and limitations, Notemachine, in its sole and absolute discretion (a) may proceed tomake such a sale whether or not a registration statement for the purpose of registering suchPledged Collateral or part thereof shall have been filed under the Federal Securities Laws and(b) may approach and negotiate with a limited number of potential Notemachines (including a singlepotential Notemachine) to effect such sale. Each Grantor acknowledges and agrees that any suchsale might result in prices and other terms less favorable to the seller than if such sale were apublic sale without such restrictions. In the event of any such sale, Notemachine shall incur noresponsibility or liability for selling all or any part of the Pledged Collateral at a price thatNotemachine, in its sole and absolute discretion, may in good faith deem reasonable under thecircumstances, notwithstanding the possibility that a substantially higher price might have beenrealized if the sale were deferred until after registration as aforesaid or if more than a limitednumber of Notemachines (or a single Notemachine) were approached. The provisions of this Sectionwill apply notwithstanding the existence of a public or private market upon which the quotations orsales prices may exceed substantially the price at which Notemachine sells.ARTICLE V***Miscellaneous***          SECTION 5.01. ***Notices.***All communications and notices hereunder shall (except as otherwiseexpressly permitted herein) be in writing and given as follows:If to Notemachine:
 

 
Notemachine Ltd