ex103.htm


    Exhibit
10.3

     

    SECURITY
AGREEMENT

    


                This
SECURITY AGREEMENT, dated as of January 9, 2009 (this “Agreement”), is among
Urigen Pharmaceuticals, Inc., a Delaware corporation (the “Company”), all of the
subsidiaries of the Company (such subsidiaries, the “Guarantors” and together
with the Company, the “Debtors”), and Platinum-Montaur
Life Sciences, LLC (together with its successors and assigns, the “Secured Party”), as
collateral agent for the investors identified in the Purchase
Agreement (the “Lenders”), which
Lenders are the holders of the Company’s Senior Secured Convertible
Promissory Notes, issued on January 9, 2009 in the aggregate original
principal amount of $257,000 (the “Notes”).

    


    W
I T N E S S E T H:

    


                WHEREAS, pursuant to the
Notes, the Lenders have agreed to extend the loans to the Company evidenced by
the Notes;

    


                WHEREAS, pursuant to a certain
Guaranty, dated as of the date hereof (the “Guaranty”), the Guarantors
have jointly and severally agreed to guarantee and act as surety for payment of
such Notes; and

    


                WHEREAS, in order to induce
the Secured Party to extend the loans evidenced by the Notes, each Debtor has
agreed to execute and deliver to the Secured Party this Agreement and to grant
the Secured Party a security interest, for the benefit of the Lenders,
in certain property of such Debtor to secure the prompt payment, performance and
discharge in full of all of the Company’s obligations under the Notes and
the Guarantors’ obligations under the Guaranty.

    


               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 (including the terms “account”,
“chattel paper”, “commercial tort claim”, “deposit account”, “document”,
“equipment”, “fixtures”, “general intangibles”, “goods”, “instruments”,
“inventory”, “investment property”, “letter-of-credit rights”, “proceeds”,
“securities” and “supporting obligations”) shall have the respective
meanings given such terms in Article 9 of the UCC.

    


    (a) “Collateral” means the
collateral in which the Secured Party is granted a security interest by
this Agreement and which shall include the following personal property of the
Debtors, whether presently owned or existing or hereafter acquired or coming
into existence, wherever situated, and all additions and accessions thereto and
all substitutions and replacements thereof, and all proceeds, products and
accounts thereof, including, without limitation, all proceeds from the sale or
transfer of the Collateral and of insurance covering the same and of any tort
claims in connection therewith, and all dividends, interest, cash, notes,
securities, equity interest or other property at any time and from time to time
acquired, receivable or otherwise distributed in respect of, or in exchange for,
any or all of the Pledged Securities (as defined below):

     

     

     

     

    
      
        
        

      

      
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    (i) All
goods, including, without limitation, (A) all machinery, equipment, computers,
motor vehicles, trucks, tanks, boats, ships, appliances, furniture, special and
general tools, fixtures, test and quality control devices and other equipment of
every kind and nature and wherever situated, together with all documents of
title and documents representing the same, all additions and accessions thereto,
replacements therefor, all parts therefor, and all substitutes for any of the
foregoing and all other items used and useful in connection with any Debtor’s
businesses and all improvements thereto; and (B) all inventory, including all
materials, work in process and finished goods;

    


    (ii) All
contract rights and other general intangibles, including, without limitation,
all partnership interests, membership interests, stock or other securities,
rights under any of the Organizational Documents, agreements related to the
Pledged Securities, licenses, distribution and other agreements, computer
software (whether “off-the-shelf”, licensed from any third party or developed by
any Debtor), computer software development rights, leases, franchises, customer
lists, quality control procedures, grants and rights, goodwill, trademarks,
service marks, trade styles, trade names, patents, patent applications,
copyrights, and income tax refunds; 

    


    (iii) All
accounts, together with all instruments, all documents of title representing any
of the foregoing, all rights in any merchandising, goods, equipment, motor
vehicles and trucks which any of the same may represent, and all right, title,
security and guaranties with respect to each account, including any right of
stoppage in transit; 

    


    (iv) All
documents, letter-of-credit rights, instruments and chattel paper;

    


    (v) All
commercial tort claims;

    


    (vi) All
deposit accounts and all cash (whether or not deposited in such deposit
accounts);

    


    (vii) All
investment property;

    


    (viii) All
supporting obligations; 

    


    (ix) All
files, records, books of account, business papers, and computer programs;
and

     

     

     

    
      
        
        

      

      
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    (x) the
products and proceeds of all of the foregoing Collateral set forth in clauses
(i)-(ix) above.

    


    Without
limiting the generality of the foregoing, the “Collateral” shall
include all investment property and general intangibles respecting ownership
and/or other equity interests in each subsidiary, including, without limitation,
the shares of capital stock and the other equity interests listed on Schedule H hereto (as
the same may be modified from time to time pursuant to the terms hereof), and
any other shares of capital stock and/or other equity interests of any other
direct or indirect subsidiary of any Debtor obtained in the future, and, in each
case, all certificates representing such shares and/or equity interests and, in
each case, all rights, options, warrants, stock, other securities and/or equity
interests that may hereafter be received, receivable or distributed in respect
of, or exchanged for, any of the foregoing and all rights arising under or in
connection with the Pledged Securities, including, but not limited to, all
dividends, interest and cash.

     

    Notwithstanding
the foregoing, nothing herein shall be deemed to constitute an assignment of any
asset which, in the event of an assignment, becomes void by operation of
applicable law or the assignment of which is otherwise prohibited by applicable
law (in each case to the extent that such applicable law is not overridden by
Sections 9-406, 9-407 and/or 9-408 of the UCC or other similar applicable
law); provided, however, that to the extent permitted by applicable law, this
Agreement shall create a valid security interest in such asset and, to the
extent permitted by applicable law, this Agreement shall create a valid security
interest in the proceeds of such asset.

    


    (b) “Intellectual
Property” means the collective reference to all rights, priorities and
privileges relating to intellectual property, whether arising under United
States, multinational or foreign laws or otherwise, including, without
limitation, (i) all copyrights arising under the laws of the United States, any
other country or any political subdivision thereof, whether registered or
unregistered and whether published or unpublished, all registrations and
recordings thereof, and all applications in connection therewith, including,
without limitation, all registrations, recordings and applications in the United
States Copyright Office, (ii) all letters patent of the United States, any other
country or any political subdivision thereof, all reissues and extensions
thereof, and all applications for letters patent of the United States or any
other country and all divisions, continuations and continuations-in-part
thereof, (iii) all trademarks, trade names, corporate names, company names,
business names, fictitious business names, trade dress, service marks, logos,
domain names and other source or business identifiers, and all goodwill
associated therewith, now existing or hereafter adopted or acquired, all
registrations and recordings thereof, and all applications in connection
therewith, whether in the United States Patent and Trademark Office or in any
similar office or agency of the United States, any State thereof or any other
country or any political subdivision thereof, or otherwise, and all common law
rights related thereto, (iv) all trade secrets arising under the laws of the
United States, any other country or any political subdivision thereof, (v) all
rights to obtain any reissues, renewals or extensions of the foregoing, (vi) all
licenses for any of the foregoing, and (vii) all causes of action for
infringement of the foregoing.

    


    (c) “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 Secured Party may reasonably request.

     

     

     

     

    
      
        
        

      

      
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    (d) “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, of any Debtor to the Secured
Party under this Agreement, the Notes, the Purchase Agreement, the Guaranty 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 the Secured Party as a preference, fraudulent
transfer or otherwise as such obligations may be amended, supplemented,
converted, extended or modified from time to time.  Without limiting
the generality of the foregoing, the term “Obligations” shall include, without
limitation: (i) principal of, and interest on, the Notes and the loans extended
pursuant thereto; (ii) any and all other fees, indemnities, costs, obligations
and liabilities of the Debtors from time to time under or in connection with
this Agreement, the Notes, the Purchase Agreement, the Guaranty and any other
instruments, agreements or other documents executed and/or delivered in
connection herewith or therewith; and (iii) all amounts (including but not
limited to post-petition interest) in respect of the foregoing that would be
payable but for the fact that the obligations to pay such amounts are
unenforceable or not allowable due to the existence of a bankruptcy,
reorganization or similar proceeding involving any Debtor.

    


    (e) “Organizational
Documents” means, with respect to any Debtor, the documents by which such
Debtor was organized (such as a certificate of incorporation, certificate of
limited partnership or articles of organization, and including, without
limitation, any certificates of designation for preferred stock or other forms
of preferred equity) and which relate to the internal governance of such Debtor
(such as bylaws, a partnership agreement or an operating, limited liability or
members agreement).

    


    (f) “Pledged Securities”
shall have the meaning ascribed to such term in Section 4(i).

    


    (g) “Purchase Agreement”
means the Note and Warrant Purchase Agreement, dated as of the date hereof,
between the Company and the Lenders.

    


    (h) “UCC” means the
Uniform Commercial Code of the State of New York and/or any other applicable law
of any state or states which have 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.

     

     

     

    
      
        
        

      

      
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    2. Grant of Security Interest in Collateral. As an
inducement for the Lenders to extend the loans as evidenced by the Notes and to
secure the complete and timely payment, performance and discharge in full, as
the case may be, of all of the Obligations, each Debtor hereby unconditionally
and irrevocably pledges, grants and hypothecates to the Secured Party a security
interest in and to, a lien upon, and a right of set-off against, all of its
respective right, title and interest of whatsoever kind and nature in and to the
Collateral (a “Security Interest”
and collectively, the “Security
Interests”).  To the extent there is at any time more than one
Secured Party hereunder, the Collateral will secure the Obligations to the
Secured Party on a pari passu basis, based on the then outstanding amount of
such Obligations.

    


    3. Delivery of Certain
Collateral.  Contemporaneously with or prior to the execution
of this Agreement, each Debtor shall deliver or cause to be delivered to the
Secured Party (a) any and all certificates and other instruments representing or
evidencing the Pledged Securities, and (b) any and all certificates and other
instruments or documents representing any of the other Collateral, in each case,
together with all Necessary Endorsements.  The Debtors are,
contemporaneously with the execution hereof, delivering to the Secured Party, or
have previously delivered to the Secured Party, a true and correct copy of each
Organizational Document governing any of the Pledged Securities.

    


    4. Representations, Warranties,
Covenants and Agreements of the Debtors. Except as set forth under the
corresponding section of the disclosure schedules delivered to the Secured Party
concurrently herewith (the “Disclosure Schedules”),
which Disclosure Schedules shall be deemed a part hereof, each Debtor represents
and warrants to, and covenants and agrees with, the Secured Party as
follows:

    


    (a)       Each
Debtor has the requisite corporate, partnership, limited liability company or
other power and authority to enter into this Agreement and otherwise to carry
out its obligations hereunder. The execution, delivery and performance by each
Debtor of this Agreement and the filings contemplated therein have been duly
authorized by all necessary action on the part of such Debtor and no further
action is required by such Debtor.  This Agreement has been duly
executed by each Debtor.  This Agreement constitutes the legal, valid
and binding obligation of each Debtor, enforceable against each Debtor in
accordance with its terms except as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization and similar laws of general
application relating to or affecting the rights and remedies of creditors and by
general principles of equity.

    


    (b) The
Debtors have no place of business or offices where their respective books of
account and records are kept (other than temporarily at the offices of their
attorneys or accountants) or places where Collateral is stored or located,
except as set forth on Schedule A attached
hereto.  The Debtors own of record, subject only to Permitted
Encumbrances (as defined in the Notes), the real property where such Collateral
is located, as identified on Schedule
A.  Except as disclosed on Schedule A, none of such
Collateral is in the possession of any consignee, bailee, warehouseman, agent or
processor.

    


    (c) Except
for Permitted Encumbrances and except as set forth on Schedule B attached
hereto, the Debtors are the sole owners of the Collateral, free and clear of any
liens, security interests, encumbrances, rights or claims, and are fully
authorized to grant the Security Interests.  Except with respect to
Permitted Encumbrances and except as set forth on Schedule B attached
hereto, there is not on file in any governmental or regulatory authority, agency
or recording office an effective financing statement, security agreement,
license or transfer or any notice of any of the foregoing (other than those that
will be filed in favor of the Secured Party pursuant to this Agreement) covering
or affecting any of the Collateral.  Except with respect to Permitted
Encumbrances, except as set forth on Schedule B attached
hereto and except pursuant to this Agreement, as long as this Agreement shall be
in effect, the Debtors shall not execute and shall not knowingly permit to be on
file in any such office or agency any other financing statement or other similar
document or instrument (except to the extent filed or recorded in favor of the
Secured Party pursuant to the terms of this Agreement).

    


    (d) No
written claim has been received by any Debtor that any Collateral or Debtor's
use of any Collateral violates the rights of any third party. There has been no
adverse decision to any Debtor's claim of ownership rights in or exclusive
rights to use the Collateral in any jurisdiction or to any Debtor's right to
keep and maintain such Collateral in full force and effect, and there is no
proceeding involving said rights pending or, to the best knowledge of any
Debtor, threatened before any court, judicial body, administrative or regulatory
agency, arbitrator or other governmental authority.

    


    (e) Each
Debtor shall at all times maintain its books of account and records relating to
the Collateral at its principal place of business (except when temporarily kept
at the offices of its attorneys or accountants) and its Collateral at the
locations set forth on Schedule A attached
hereto and may not relocate such books of account and records or tangible
Collateral unless it delivers to the Secured Party at least 30 days prior to
such relocation (i) written notice of such relocation and the new location
thereof (which must be within the United States) and (ii) evidence that
appropriate financing statements under the UCC and other necessary documents
have been filed and recorded and other steps have been taken to perfect the
Security Interests to create in favor of the Secured Party, subject to Permitted
Encumbrances, a valid, perfected and continuing perfected first priority lien in
the Collateral.

     

     

    
      
        
        

      

      
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    (f) This
Agreement creates in favor of the Secured Party a valid, security interest in
the Collateral, subject only to Permitted Encumbrances (as defined in the
Notes), securing the payment and performance of the Obligations.  Upon
making the filings described in the immediately following paragraph, all
security interests created hereunder in any Collateral which may be perfected by
filing UCC financing statements shall have been duly
perfected.  Except for the filing of the UCC financing statements
referred to in the immediately following paragraph, the recordation of the
Intellectual Property Security Agreement (as defined below) with respect to
copyrights and copyright applications in the United States Copyright Office
referred to in paragraph (p), and the delivery of the certificates and other
instruments provided in Section 3, no action is necessary to create, perfect or
protect the security interests created hereunder.  Without limiting
the generality of the foregoing, except for the filing of said financing
statements and the recordation of said Intellectual Property Security Agreement,
no consent of any third parties and no authorization, approval or other action
by, and no notice to or filing with, any governmental authority or regulatory
body is required for (i) the execution, delivery and performance of this
Agreement, (ii) the creation or perfection of the Security Interests created
hereunder in the Collateral or (iii) the enforcement of the rights of the
Secured Party hereunder.

    


    (g) Each
Debtor hereby authorizes the Secured Party to file one or more financing
statements under the UCC with respect to the Security Interests with the proper
filing and recording agencies in any jurisdiction deemed proper by it, which UCC
financing statement may describe the collateral as “All assets”.

    


    (h) The
execution, delivery and performance of this Agreement by the Debtors do not (i)
violate any of the provisions of any Organizational Documents of any Debtor or
any judgment, decree, order or award of any court, governmental body or
arbitrator or any applicable law, rule or regulation applicable to any Debtor or
(ii) conflict with, or constitute a default (or an event that with notice or
lapse of time or both would become a default) under, or give to others any
rights of termination, amendment, acceleration or cancellation (with or without
notice, lapse of time or both) of, any agreement, credit facility, debt or other
instrument (evidencing any Debtor's debt or otherwise) or other understanding to
which any Debtor is a party or by which any property or asset of any Debtor is
bound or affected. If any, all required consents (including, without limitation,
from stockholders or creditors of any Debtor) necessary for any Debtor to enter
into and perform its obligations hereunder have been obtained.

    


    (i) The
capital stock and other equity interests listed on Schedule H hereto
(the “Pledged
Securities”) represent all of the capital stock and other equity
interests in and to the Guarantors and the other subsidiaries of the Company,
and represent all capital stock and other equity interests owned, directly or
indirectly, by the Company.  All of the Pledged Securities are validly
issued, fully paid and nonassessable, and the Company is the legal and
beneficial owner of the Pledged Securities, free and clear of any lien,
security interest or other encumbrance except for the security interests created
by this Agreement and other Permitted Encumbrances.  Each Debtor shall
cause the pledge and security interest of the Secured Party to be duly noted in
its corporate books and records. 

    


    (j) The
ownership and other equity interests in partnerships and limited liability
companies (if any) included in the Collateral (the “Pledged Interests”)
by their express terms do not provide that they are securities governed by
Article 8 of the UCC and are not held in a securities account or by any
financial intermediary.

     

     

     

    
      
        
        

      

      
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    (k) Except
for Permitted Encumbrances (as defined in the Notes), each Debtor shall at all
times maintain the liens and Security Interests provided for hereunder as valid
and perfected first priority liens and security interests in the Collateral in
favor of the Secured Party until this Agreement and the Security Interests
hereunder shall be terminated pursuant to Section 14 hereof.  Each
Debtor hereby agrees to defend the same against the claims of any and all
persons and entities and to safeguard and protect all Collateral for the account
of the Secured Party.  At the reasonable request of the Secured Party,
each Debtor will sign and deliver to the Secured Party at any time or from time
to time one or more financing statements pursuant to the UCC in form reasonably
satisfactory to the Secured Party and will pay the cost of filing the same
in all public offices wherever filing is necessary to effect the rights and
obligations provided for herein. Without limiting the generality of the
foregoing, each Debtor shall pay all fees, taxes and other amounts necessary to
maintain the Collateral and the Security Interests hereunder, and each Debtor
shall obtain and furnish to the Secured Party from time to time, upon
demand, such releases and/or subordinations of claims and liens which may be
required to maintain in accordance with this Agreement the priority of the
Security Interests hereunder.

    


    (l) Except
for Permitted Encumbrances (as defined in the Notes), no Debtor will transfer,
pledge, hypothecate, encumber, license, sell or otherwise dispose of any of the
Collateral (except for non-exclusive revocable licenses granted by a Debtor in
its ordinary course of business and sales of inventory by a Debtor in its
ordinary course of business) without the prior written consent of the Secured
Party.

    


    (m) Each
Debtor shall keep and preserve its equipment, inventory and other tangible
Collateral in good condition, repair and order and shall not operate or locate
any such Collateral (or cause to be operated or located) in any area excluded
from insurance coverage.

    


    (n) Each
Debtor shall maintain with financially sound and reputable insurers, insurance
with respect to the Collateral, including Collateral hereafter acquired, against
loss or damage of the kinds and in the amounts customarily insured against by
entities of established reputation having similar properties similarly situated
and in such amounts as are customarily carried under similar circumstances by
other such entities and otherwise as is prudent for entities engaged in similar
businesses but in any event sufficient to cover the full replacement cost
thereof.  Each Debtor shall cause each insurance policy issued in
connection herewith to provide, and the insurer issuing such policy to certify
to the Secured Party that (a) the Secured Party will be named as
lender loss payee and additional insured under each such insurance policy; (b)
if such insurance be proposed to be cancelled or materially changed for any
reason whatsoever, such insurer will promptly notify the Secured Party and
such cancellation or change shall not be effective as to the Secured Party for
at least thirty (30) days after receipt by the Secured Party of such
notice, unless the effect of such change is to extend or increase coverage under
the policy; and (c) the Secured Party will have the right (but no obligation) at
its election to remedy any default in the payment of premiums within thirty (30)
days of notice from the insurer of such default.  If no Event of
Default (as defined in the Notes) exists and if the proceeds arising out of any
claim or series of related claims do not exceed $100,000, loss payments in each
instance will be applied by the applicable Debtor to the repair and/or
replacement of property with respect to which the loss was incurred to the
extent reasonably feasible, and any loss payments or the balance thereof
remaining, to the extent not so applied, shall be payable to the applicable
Debtor, provided, however, that payments received by any Debtor after an Event
of Default occurs and is continuing or in excess of $100,000 for any occurrence
or series of related occurrences shall be paid to the Secured Party and, if
received by such Debtor, shall be held in trust for the Secured Party and
promptly paid over to the Secured Party unless otherwise directed in writing by
the Secured Party.   Copies of such policies or the related
certificates, in each case, naming the Secured Party as lender loss payee
and additional insured shall be delivered to the Secured Party at least
annually and at the time any new policy of insurance is issued.

    


    (o) Each
Debtor shall, within ten (10) days of obtaining knowledge thereof, advise the
Secured Party promptly, in sufficient detail, of any material adverse change in
the Collateral, and of the occurrence of any event which would have a material
adverse effect on the value of the Collateral or on the Secured Party’s security
interest therein.

     

     

     

    
      
        
        

      

      
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    (p) Each
Debtor shall promptly execute and deliver to the Secured Party such further
deeds, mortgages, assignments, security agreements, financing statements or
other instruments, documents, certificates and assurances and take such further
action as the Secured Party may from time to time request as necessary to
perfect, protect or enforce the Secured Party’s security interest in the
Collateral (including, without limitation, the execution and delivery of a
separate security agreement with respect to each Debtor’s Intellectual Property
(“Intellectual Property Security
Agreement”) to be delivered on the date hereof) in which the Secured
Party has been granted a security interest hereunder, substantially in a form
reasonably acceptable to the Secured Party. 

    


    (q) Each
Debtor shall permit the Secured Party and its representatives and agents
reasonable access to inspect the Collateral during normal business hours, upon
reasonable prior notice and without undue interference with such Debtor’s
business operations, and to make copies of records pertaining to the Collateral
as may be reasonably requested by the Secured Party from time to
time.

    


    (r) Each
Debtor shall take all steps reasonably necessary to diligently pursue and seek
to preserve, enforce and collect any rights, claims, causes of action and
accounts receivable in respect of the Collateral.

    


    (s) Each
Debtor shall promptly notify the Secured Party in sufficient detail upon
becoming aware of any attachment, garnishment, execution or other legal process
levied against any Collateral and of any other information received by such
Debtor that would have a material adverse effect on the value of the Collateral,
the Security Interest or the rights and remedies of the Secured Party
hereunder.

    


    (t) All
information heretofore, herein or hereafter supplied to the Secured Party by or
on behalf of any Debtor with respect to the Collateral is accurate and complete
in all material respects as of the date furnished.

    


    (u) The
Debtors shall at all times preserve and keep in full force and effect their
respective valid existence and good standing and any rights and franchises
material to their respective businesses.

    


    (v) No Debtor
will change its name, type of organization, jurisdiction of organization,
organizational identification number (if it has one), legal or corporate
structure, or identity, or add any new fictitious name unless it provides at
least 30 days’ prior written notice to the Secured Party of such change and, at
the time of such written notification, such Debtor provides any financing
statements or fixture filings necessary to perfect and continue the perfection
of the Security Interests granted and evidenced by this Agreement.

    


    (w) No Debtor
may consign any of its Inventory or sell any of its Inventory on bill and hold,
sale or return, sale on approval, or other conditional terms of sale without the
consent of the Secured Party, which shall not be unreasonably
withheld.

    


    (x) No Debtor
may relocate its chief executive office to a new location without providing 30
days’ prior written notification thereof to the Secured Party and so long as, at
the time of such written notification, such Debtor provides any financing
statements or fixture filings necessary to perfect and continue the perfection
of the Security Interests granted and evidenced by this Agreement.

    


    (y) Each
Debtor was organized and remains organized solely under the laws of the state
set forth next to such Debtor’s name in  Schedule D attached
hereto, which Schedule
D sets forth each Debtor’s organizational identification number or, if
any Debtor does not have one, states that one does not exist

    


    (z) (i) The
actual name of each Debtor is the name set forth in Schedule D attached
hereto; (ii) no Debtor has any trade names except as set forth on Schedule E attached
hereto; (iii) no Debtor has used any name other than that stated in the preamble
hereto or as set forth on Schedule E for the
preceding five years; and (iv) no entity has merged into any Debtor or been
acquired by any Debtor within the past five years except as set forth on Schedule
E.

     

     

     

    
      
        
        

      

      
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    (aa) At any
time and from time to time that any Collateral consists of instruments,
certificated securities or other items that require or permit possession by the
secured party to perfect the security interest created hereby, the applicable
Debtor shall deliver such Collateral to the Secured Party.

    


    (bb) Each
Debtor, in its capacity as issuer, hereby agrees to comply with any and all
reasonable orders and instructions of Secured Party regarding the Pledged
Interests consistent with the terms of this Agreement without the further
consent of any Debtor as contemplated by Section 8-106 (or any successor
section) of the UCC.  Further, each Debtor agrees that it shall not
enter into a similar agreement (or one that would confer “control” within the
meaning of Article 8 of the UCC) with any other person
or entity.

    


    (cc) Each
Debtor shall cause all tangible chattel paper constituting Collateral to be
delivered to the Secured Party, or, if such delivery is not possible, then to
cause such tangible chattel paper to contain a legend noting that it is subject
to the security interest created by this Agreement.  To the extent
that any Collateral consists of electronic chattel paper, the applicable Debtor
shall cause the underlying chattel paper to be “marked” within the meaning of
Section 9-105 of the UCC (or successor section thereto).

    


    (dd) If there
is any investment property or deposit account included as Collateral that can be
perfected by “control” through an account control agreement, the applicable
Debtor shall cause such an account control agreement, in form and substance in
each case reasonably satisfactory to the Secured Party, to be entered into and
delivered to the Secured Party.

    


    (ee) To the
extent that any Collateral consists of letter-of-credit rights, the applicable
Debtor shall cause the issuer of each underlying letter of credit to consent to
an assignment of the proceeds thereof to the Secured Party.

    


    (ff) To the
extent that any Collateral is in the possession of any third party, the
applicable Debtor shall join with the Secured Party in notifying such third
party of the Secured Party’s security interest in such Collateral and shall
endeavor to obtain an acknowledgement and agreement from such third party with
respect to the Collateral, in form and substance reasonably satisfactory to the
Secured Party.

    


    (gg) If any
Debtor shall at any time hold or acquire a commercial tort claim, such Debtor
shall promptly notify the Secured Party in a writing signed by such Debtor of
the particulars thereof and grant to the Secured Party in such writing a
security interest therein and in the proceeds thereof, all upon the terms of
this Agreement, with such writing to be in form and substance reasonably
satisfactory to the Secured Party.

    


    (hh) Each
Debtor shall promptly provide written notice to the Secured Party of any and all
accounts which arise out of contracts with any governmental authority and, to
the extent necessary to perfect or continue the perfected status of the Security
Interests in such accounts and proceeds thereof, shall execute and deliver to
the Secured Party an assignment of claims for such accounts and cooperate
with the Secured Party in taking any other steps required under the Federal
Assignment of Claims Act or any similar foreign, federal, state or local statute
or rule to perfect or continue the perfected status of the Security Interests in
such accounts and proceeds thereof.

    


    (ii) Each
Debtor shall cause each subsidiary of such Debtor with operations or material
operations (which, if in doubt, shall be in the sole determination of the
Secured Party) to immediately become a party hereto (an “Additional Debtor”),
by executing and delivering an Additional Debtor Joinder in substantially the
form of Annex A
attached hereto and comply with the provisions hereof applicable to the
Debtors.  As of the date hereof, the each Debtor represents and
warrants that none of its subsidiaries have any operations or material assets
(other than the Guarantors).  Concurrent therewith, the Additional
Debtor shall deliver replacement schedules for, or supplements to all other
Schedules to (or referred to in) this Agreement, as applicable, which
replacement schedules shall supersede, or supplements shall modify, the
Schedules then in effect.  The Additional Debtor shall also deliver
such opinions of counsel, authorizing resolutions, good standing certificates,
incumbency certificates, organizational documents, financing statements and
other information and documentation as the Secured Party may reasonably
request.  Upon delivery of the foregoing to the Secured Party, the
Additional Debtor shall be and become a party to this Agreement with the same
rights and obligations as the Debtors, for all purposes hereof as fully and to
the same extent as if it were an original signatory hereto and shall be deemed
to have made the representations, warranties and covenants set forth herein as
of the date of execution and delivery of such Additional Debtor Joinder, and all
references herein to the “Debtors” shall be deemed to include each Additional
Debtor.

    


    (jj) Each
Debtor shall vote the Pledged Securities to comply with the covenants and
agreements set forth herein and in the Notes and the other Transaction Documents
(as defined in the Purchase Agreement).

     

     

     

    
      
        
        

      

      
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    (kk) Each
Debtor shall register the pledge of the applicable Pledged Securities on the
books of such Debtor.  Each Debtor shall notify each issuer of Pledged
Securities to register the pledge of the applicable Pledged Securities in the
name of the Secured Party on the books of such issuer.  Further,
except with respect to certificated securities delivered to the Secured Party, the
applicable Debtor shall deliver to the Secured
Party an acknowledgement of pledge (which, where appropriate, shall
comply with the requirements of the relevant UCC with respect to perfection by
registration) signed by the issuer of the applicable Pledged Securities, which
acknowledgement shall confirm that: (a) it has registered the pledge on its
books and records; and (b) at any time directed by the Secured Party
during the continuation of an Event of Default, such issuer will transfer the
record ownership of such Pledged Securities into the name of any designee of the
Secured
Party, will take such steps as may be necessary to effect the transfer,
and will comply with all other reasonable instructions of the Secured
Party regarding such Pledged Securities without the further consent of
the applicable Debtor.

    


    (ll) In the
event that, upon an occurrence of an Event of Default, the Secured Party shall
sell all or any of the Pledged Securities to another party or parties (herein
called the “Transferee”) or shall
purchase or retain all or any of the Pledged Securities, each Debtor shall, to
the extent applicable: (i) deliver to the Secured Party or the Transferee,
as the case may be, the articles 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 such Debtor and its direct and indirect
subsidiaries; (ii) use its best efforts to obtain resignations of the persons
then serving as officers and directors of such Debtor and its direct and
indirect subsidiaries, if so requested; 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 Securities to the Transferee or the purchase
or retention of the Pledged Securities by the Secured Party and allow the
Transferee or Secured Party to continue the business of such Debtor and its
direct and indirect subsidiaries.

    


    (mm) Without
limiting the generality of the other obligations of the Debtors hereunder, each
Debtor shall promptly (i) cause to be registered at the United States Copyright
Office all of its material copyrights, (ii) cause the security interest
contemplated hereby with respect to all Intellectual Property registered at the
United States Copyright Office or United States Patent and Trademark Office to
be duly recorded at the applicable office, and (iii) give the Secured
Party notice whenever it acquires (whether absolutely or by license) or
creates any additional material Intellectual Property.  The Debtors
shall take all steps necessary, if permitted by law, to register the Secured
Party’s first property lien on any patents or copyrights (or applications
therefor) filed in any foreign jurisdiction within 60 days of the date hereof
and take any other steps necessary under the laws of such jurisdictions to
perfect the grant of the security interest to the Security Party to secure the
Obligations as contemplated herein.

    


    (nn) Each
Debtor will from time to time, at the joint and several expense of the Debtors,
promptly execute and deliver all such further instruments and documents, and
take all such further action as may be necessary or desirable, or as the Secured
Party may reasonably request, in order to perfect and protect any security
interest granted or purported to be granted hereby or to enable the Secured
Party to exercise and enforce its rights and remedies hereunder and with respect
to any Collateral or to otherwise carry out the purposes of this
Agreement.

    


    (oo) Schedule F attached
hereto lists all of the patents, patent applications, trademarks, trademark
applications, registered copyrights, and domain names owned by any of the
Debtors as of the date hereof.  Schedule F lists all
material licenses in favor of any Debtor for the use of any patents, trademarks,
copyrights and domain names as of the date hereof.  All material
patents and trademarks of the Debtors have been duly recorded at the United
States Patent and Trademark Office and all material copyrights of the Debtors
have been duly recorded at the United States Copyright Office.

    


    (pp) Except as
set forth on Schedule
G attached hereto, none of the account debtors or other persons or
entities obligated on any of the Collateral is a governmental authority covered
by the Federal Assignment of Claims Act or any similar federal, state or local
statute or rule in respect of such Collateral.

     

     

     

    
      
        
        

      

      
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    5. Effect of Pledge on Certain
Rights. If
any of the Collateral subject to this Agreement consists of nonvoting equity or
ownership interests (regardless of class, designation, preference or rights)
that may be converted into voting equity or ownership interests upon the
occurrence of certain events (including, without limitation, upon the transfer
of all or any of the other stock or assets of the issuer), it is agreed that the
pledge of such equity or ownership interests pursuant to this Agreement or the
enforcement of any of the Secured Party’s rights hereunder shall not be deemed
to be the type of event which would trigger such conversion rights
notwithstanding any provisions in the Organizational Documents or agreements to
which any Debtor is subject or to which any Debtor is party.

    


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

    


    
      	
              (a)  

            	
              The occurrence of an Event of
      Default under the Notes;

            


    

    


    (b) Any
representation or warranty of any Debtor in this Agreement shall prove to have
been incorrect in any material respect when made; or

    


    (c) The
failure by any Debtor to observe or perform any of its obligations hereunder for
five (5) days after delivery to such Debtor of notice of such failure by or on
behalf of the Secured Party unless such default is capable of cure but cannot be
cured within such time frame and such Debtor is using best efforts to cure same
in a timely fashion.

    


    7. Duty To Hold In
Trust.

    


    (a) Upon the
occurrence and during the continuance of any Event of Default and at any time
thereafter, each Debtor shall, upon receipt of any revenue, income, dividend,
interest or other sums subject to the Security Interests, whether payable
pursuant to the Notes or otherwise, or of any check, draft, note, trade
acceptance or other instrument evidencing an obligation to pay any such sum,
hold the same in trust for the Secured Party and shall forthwith endorse and
transfer any such sums or instruments, or both, to the Secured
Party.  

    


    (b) If any
Debtor shall become entitled to receive or shall receive any securities or other
property (including, without limitation, shares of Pledged Securities or
instruments representing Pledged Securities 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 such Debtor or any of its direct
or indirect subsidiaries) in respect of the Pledged Securities (whether as an
addition to, in substitution of, or in exchange for, such Pledged Securities or
otherwise), such Debtor agrees to (i) accept the same as the agent of the
Secured Party; (ii) hold the same in trust on behalf of and for the benefit of
the Secured Party; and (iii) deliver any and all certificates or instruments
evidencing the same to the Secured Party on or before the close of business
on the fifth business day following the receipt thereof by such Debtor, in the
exact form received together with the Necessary Endorsements, to be held by the
Secured Party subject to the terms of this Agreement as
Collateral.

     

     

    
      
        
        

      

      
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              8.  

            	
              Rights and Remedies Upon
      Default.

            


    

    


    (a) Upon the
occurrence of any Event of Default and at any time thereafter, the Secured
Party shall have the right to exercise all of the remedies conferred
hereunder and under the other Transaction Documents, and the Secured Party shall
have all the rights and remedies of a secured party under the
UCC.  Without limitation, the Secured Party shall have the
following rights and powers:

    


    (i) The
Secured Party shall have the right to take possession of the Collateral and, for
that purpose, enter by reasonable means, with the aid and assistance of any
person, any premises where the Collateral, or any part thereof, is or may be
placed and remove the same, and each Debtor shall assemble the Collateral and
make it available to the Secured Party at places which the Secured Party shall
reasonably select, whether at such Debtor's premises or elsewhere, and make
reasonably available to the Secured Party, without rent, all of such Debtor’s
respective premises and facilities for the purpose of the Secured
Party taking possession of, removing or putting the Collateral in saleable
or disposable form.

    


    (ii) Upon
written notice to the Debtors by the Secured Party, all rights of each Debtor to
exercise the voting and other consensual rights which it would otherwise be
entitled to exercise and all rights of each Debtor to receive the dividends and
interest which it would otherwise be authorized to receive and retain, shall
cease.  Upon such notice, the Secured Party shall have the right
to receive any interest, cash dividends or other payments on the Collateral and,
at the option of the Secured Party, to exercise in the Secured Party’s
discretion all voting rights pertaining thereto.  Without limiting the
generality of the foregoing, the Secured Party shall have the right (but
not the obligation) to exercise all rights with respect to the Collateral as if
it were the sole and absolute owner thereof, including, without limitation, to
vote and/or to exchange, at its sole discretion, any or all of the Collateral in
connection with a merger, reorganization, consolidation, recapitalization or
other readjustment concerning or involving the Collateral or any Debtor or any
of its direct or indirect subsidiaries.

    


    (iii) The
Secured Party shall have the right to assign, sell, lease or otherwise dispose
of and deliver all or any part of the Collateral, at public or private sale or
otherwise, either with or without special conditions or stipulations, for cash
or on credit or for future delivery, in such parcel or parcels and at such time
or times and at such place or places, and upon commercially reasonable terms and
conditions.  Upon each such sale, lease, assignment or other transfer
of Collateral, the Secured Party, may, unless prohibited by applicable law which
cannot be waived, purchase all or any part of the Collateral being sold, free
from and discharged of all trusts, claims, right of redemption and equities of
any Debtor, which are hereby waived and released.

    


    (iv) The
Secured Party shall have the right (but not the obligation) to notify any
account debtors and any obligors under instruments or accounts to make payments
directly to the Secured Party, and to enforce the Debtors’ rights against such
account debtors and obligors.

    


    (v) The Secured
Party, may (but is not obligated to) direct any financial intermediary or any
other person or entity holding any investment property to transfer the same to
the Secured Party, or its designee.

    


    (vi) The
Secured Party may (but is not obligated to) transfer any or all Intellectual
Property registered in the name of any Debtor at the United States Patent and
Trademark Office and/or Copyright Office into the name of the Secured Party or
any designee or any purchaser of any Collateral.

    


    (b)            The
Secured Party 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 Secured Party may sell the Collateral without giving
any warranties and may specifically disclaim such warranties.  In
addition, each Debtor waives any and all rights that it may have to a judicial
hearing in advance of the enforcement of any of the Secured Party’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.

     

    (c) For the purpose of enabling the Secured
Party to further exercise rights and remedies under this Section 8 or elsewhere
provided by agreement or applicable law, each Debtor hereby grants to the
Secured Party, an irrevocable, nonexclusive license (exercisable without payment
of royalty or other compensation to such Debtor) to use, license or sublicense
following an Event of Default, any Intellectual Property now owned or hereafter
acquired by such Debtor, and wherever the same may be located, and including in
such license access to all media in which any of the licensed items may be
recorded or stored and to all computer software and programs used for the
compilation or printout thereof.

     

    
      
        
        

      

      
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    9. Applications of Proceeds. The
proceeds of any such sale, lease or other disposition of the Collateral
hereunder or from payments made on account of any insurance policy insuring any
portion of the Collateral shall be applied first, to the expenses of retaking,
holding, storing, processing and preparing for sale, selling, and the like
(including, without limitation, any taxes, fees and other costs reasonably
incurred in connection therewith) of the Collateral, to the reasonable
attorneys’ fees and expenses incurred by the Secured Party in enforcing the
Secured Party’s rights hereunder and in connection with collecting, storing and
disposing of the Collateral, and then to satisfaction of the Obligations, and to
the payment of any other amounts required by applicable law, after which the
Secured Party shall pay to the applicable Debtor any surplus proceeds. If, upon
the sale, license or other disposition of the Collateral, the proceeds thereof
are insufficient to pay all amounts to which the Secured Party is legally
entitled, the Debtors will be liable for the deficiency, together with interest
thereon, at the rate of 24.99% per annum or the lesser amount permitted by
applicable law (the “Default Rate”), and
the reasonable fees of any attorneys employed by the Secured Party to collect
such deficiency.  To the extent permitted by applicable law, each
Debtor waives all claims, damages and demands against the Secured Party arising
out of the repossession, removal, retention or sale of the Collateral, unless
due solely to the gross negligence or willful misconduct of the Secured Party as
determined by a final judgment (not subject to further appeal) of a court of
competent jurisdiction.

    


    10. Securities Law
Provision.  Each Debtor recognizes that the Secured Party may
be limited in its ability to effect a sale to the public of all or part of the
Pledged Securities by reason of certain prohibitions in the Securities Act of
1933, as amended, or other federal or state securities laws (collectively, 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 Securities for their own account, for investment and not with a view to
the distribution or resale thereof.  Each Debtor agrees that sales so
made may be at prices and on terms less favorable than if the Pledged Securities
were sold to the public, and that the Secured Party has no obligation to delay
the sale of any Pledged Securities for the period of time necessary to register
the Pledged Securities for sale to the public under the Securities
Laws.  Each Debtor shall cooperate with the Secured Party in its
reasonable attempt to satisfy any requirements under the Securities Laws
(including, without limitation, registration thereunder if reasonably requested
by the Secured Party) applicable to the sale of the Pledged Securities by the
Secured Party.

    


    11. Costs and Expenses. Each
Debtor agrees to pay all reasonable out-of-pocket fees, costs and expenses
incurred in connection with any filing required hereunder, including without
limitation, any financing statements pursuant to the UCC, continuation
statements, partial releases and/or termination statements related thereto or
any expenses of any searches reasonably required by the Secured
Party.  The Debtors shall also pay all other claims and charges which
would be reasonably likely to prejudice, imperil or otherwise affect the
Collateral or the Security Interests therein.  The Debtors will also,
upon demand, pay to the Secured Party the amount of any and all reasonable
expenses, including the reasonable fees and expenses of its counsel and of any
experts and agents, which the Secured Party, may incur in connection with
(i) the enforcement of this Agreement, (ii) the custody or preservation of, or
the sale of, collection from, or other realization upon, any of the Collateral,
or (iii) the exercise or enforcement of any of the rights of the Secured Party
under the Notes and the other Transaction Documents. Until so paid, any fees
payable hereunder shall be added to the principal amount of the Notes and shall
bear interest at the Default Rate.

    


    12. Responsibility for Collateral.
The Debtors assume all liabilities and responsibility in connection with all
Collateral, and the Obligations shall in no way be affected or diminished by
reason of the loss, destruction, damage or theft of any of the Collateral or its
unavailability for any reason.  Without limiting the generality of the
foregoing, (a) in no event shall the Secured Party (i) have any duty (either
before or after an Event of Default) to collect any amounts in respect of the
Collateral or to preserve any rights relating to the Collateral, or (ii) have
any obligation to clean-up or otherwise prepare the Collateral for sale, and (b)
each Debtor shall remain obligated and liable under each contract or agreement
included in the Collateral to be observed or performed by such Debtor
thereunder.  The Secured Party shall not have any obligation or
liability under any such contract or agreement by reason of or arising out of
this Agreement or the receipt by the Secured Party of any payment relating to
any of the Collateral, nor shall the Secured Party be obligated in any manner to
perform any of the obligations of any Debtor under or pursuant to any such
contract or agreement, to make inquiry as to the nature or sufficiency of any
payment received by the Secured Party in respect of the Collateral or as to the
sufficiency of any performance by any party under any such contract or
agreement, to present or file any claim, to take any action to enforce any
performance or to collect the payment of any amounts which may have been
assigned to the Secured Party or to which the Secured Party may be entitled at
any time or times.  The Secured Party shall be entitled, in its sole
discretion, to abandon any and all Collateral and any and all records concerning
the Collateral or any Debtor’s business at any time regardless of whether it has
obtained possession thereof, without any liability or responsibility of any kind
or nature whatsoever to any Debtor.

     

     

     

    
      
        
        

      

      
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    13. Security Interests Absolute. All rights and all
obligations of the parties 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; (d) any action by the Secured Party to obtain, adjust, settle and
cancel in its reasonable discretion any insurance claims or matters made or
arising in connection with the Collateral; or (e) any other circumstance which
might otherwise constitute any legal or equitable defense available to a Debtor,
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 Secured Party shall continue even if the Obligations are
barred for any reason, including, without limitation, the running of the statute
of limitations or bankruptcy.  Each Debtor 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 Secured Party 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 Secured Party, then, in any such event and to the extent thereof,
each Debtor’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.  Each Debtor waives all right to require the Secured Party to
proceed against any other person or entity or to apply any Collateral which the
Secured Party may hold at any time, or to marshal assets, or to pursue any other
remedy. 

    


    14. Term of Agreement. This
Agreement and the Security Interests shall terminate on the date on which all
payments under the Notes have been indefeasibly paid or otherwise satisfied in
full (including by way of conversion of the Notes) and all other Obligations
have been paid or discharged (other than contingent indemnification
obligations).

    


    15. Power of Attorney; Further
Assurances.

    


    (a) Each
Debtor authorizes the Secured Party, and does hereby make, constitute and
appoint the Secured Party and its officers, agents, successors or assigns
with full power of substitution, as such Debtor’s true and lawful
attorney-in-fact, with power, in the name of the Secured Party or such Debtor,
to, after the occurrence and during the continuance of an Event of Default, (i)
endorse any note, checks, drafts, money orders or other instruments of payment
(including payments payable under or in respect of any policy of insurance) in
respect of the Collateral that may come into possession of the Secured Party;
(ii) to sign and endorse any financing statement pursuant to the UCC or any
invoice, freight or express bill, bill of lading, storage or warehouse receipts,
drafts against debtors, assignments, verifications and notices in connection
with accounts, and other documents relating to the Collateral; (iii) to pay or
discharge taxes, liens, security interests or other encumbrances at any time
levied or placed on or threatened against the Collateral; (iv) to demand,
collect, receipt for, compromise, settle and sue for monies due in respect of
the Collateral; (v) to transfer any Intellectual Property or provide licenses
respecting any Intellectual Property; and (vi) generally, at the option of the
Secured Party, and at the expense of the Debtors, 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 Secured Party deems 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 Debtors might or could do; and each Debtor 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 any Debtor is
subject or to which any Debtor is a party.  Without limiting the
generality of the foregoing, after the occurrence and during the continuance of
an Event of Default, the Secured Party is specifically authorized to execute and
file any applications for or instruments of transfer and assignment of any
patents, trademarks, copyrights or other Intellectual Property with the United
States Patent and Trademark Office and the United States Copyright
Office.

    


    (b) On a
continuing basis, each Debtor will make, execute, acknowledge, deliver, file and
record, as the case may be, with the proper filing and recording agencies in any
jurisdiction, including, without limitation, the jurisdictions indicated on
Schedule C
attached hereto, all such instruments, and take all such action as may
reasonably be deemed necessary or advisable, or as reasonably requested by the
Secured Party, to perfect the Security Interests granted hereunder and otherwise
to carry out the intent and purposes of this Agreement, or for assuring and
confirming to the Secured Party the grant or perfection of a perfected security
interest in all the Collateral under the UCC.

    


    (c) Each
Debtor hereby irrevocably appoints the Secured Party as such Debtor’s
attorney-in-fact, with full authority in the place and instead of such Debtor
and in the name of such Debtor, from time to time in the Secured Party’s
discretion, to take any action and to execute any instrument which the Secured
Party may deem necessary or advisable to accomplish the purposes of this
Agreement, including the filing, in its sole discretion, of one or more
financing or continuation statements and amendments thereto, relative to any of
the Collateral without the signature of such Debtor where permitted by law,
which financing statements may (but need not) describe the Collateral as “all
assets” or “all personal property” or words of like import, and ratifies all
such actions taken by the Secured Party.  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.

     

     

     

    
      
        
        

      

      
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    16. Notices. Any demand upon or
notice to the Debtors hereunder shall be effective when delivered by hand or
when properly deposited in the mails postage prepaid, or sent by telex,
answerback received, or electronic facsimile transmission, receipt acknowledged,
or delivered to a telegraph company or overnight courier, in each case addressed
to the Debtor at the address shown below or such other address as the Debtors
may advise the Secured Party in writing.  Any notice by the Debtors to
the Secured Party shall be given as aforesaid, addressed to the Secured Party at
the address shown below or such other address as the Secured Party may advise
the Debtors in writing.

    


                Secured
Party:                           Platinum-Montaur
Life Sciences

       152 West 57th Street,
54th
Floor

       New York,
NY 10019

    


               With
copy
to:                             Burak
Anderson & Melloni, PLC

       30 Main Street, PO
Box 787

       Burlington,
Vermont 05402-0787

       Attention: Shane
W. McCormack, Esq.

       Tel. No.: (802)
862-0500

       Fax No.: (802)
862-8176

    


    Debtors:                                 Urigen
Pharmaceuticals, Inc.

    27 Maiden Lane, Suite 595

    San Francisco,
California 94108

    Attention: William J. Gardener,
MD

                        Tel. No.: (650)
259-0239

                        Fax No.: (650)
259-0901 and (866) 816-1107

     

    With a copy
to:                    Sichenzia
Ross Friedman Ference LLP

    61 Broadway, 32nd
Floor

    New York, New York 10006

    Fax No.: (212) 930-9725

    


     

    17. Other Security. To the extent
that the Obligations are now or hereafter secured by property other than the
Collateral or by the guarantee, endorsement or property of any other person,
firm, corporation or other entity, then the Secured Party shall have the right,
in its sole discretion, to pursue, relinquish, subordinate, modify or take any
other action with respect thereto, without in any way modifying or affecting any
of the Secured Party’s rights and remedies hereunder.

    


    18. Miscellaneous.

    


    (a) No course
of dealing between the Debtors and the Secured Party, nor any failure to
exercise, nor any delay in exercising, on the part of the Secured Party, any
right, power or privilege hereunder or under the Notes or any other Transaction
Documents 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 Secured Party with respect to the Collateral,
whether established hereby or by the Notes or any other Transaction Documents,
the Transaction Documents or by any other agreements, instruments or documents
or by law shall be cumulative and may be exercised singly or
concurrently.

     

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

    
 

    (c) This
Agreement, together with the exhibits and schedules hereto, the Notes, the
Transaction Documents and the related agreements contemplated hereby and thereby
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 the exhibits and schedules hereto. No
provision of this Agreement may be waived, modified, supplemented or amended
except in a written instrument signed, in the case of an amendment, by the
Debtors and the Secured Party or, in the case of a waiver, by the party against
whom enforcement of any such waived provision is
sought.  

    


    (d) If any
term, provision, covenant or restriction of this Agreement is held by a court of
competent jurisdiction to be invalid, illegal, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions set forth herein
shall remain in full force and effect and shall in no way be affected, impaired
or invalidated, and the parties hereto shall use their commercially reasonable
efforts to find and employ an alternative means to achieve the same or
substantially the same result as that contemplated by such term, provision,
covenant or restriction. It is hereby stipulated and declared to be the
intention of the parties that they would have executed the remaining terms,
provisions, covenants and restrictions without including any of such that may be
hereafter declared invalid, illegal, void or unenforceable.

    


    (e) 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.

    


    (f) This
Agreement shall be binding upon and inure to the benefit of the parties and
their successors and permitted assigns.  The Company and the
Guarantors may not assign this Agreement or any rights or obligations hereunder
without the prior written consent of the Secured Party.  The Secured
Party may assign any or all of its rights under this Agreement to any Person to
whom the Secured Party assigns or transfers any Securities, provided such
transferee agrees in writing to be bound, with respect to the transferred
Securities, by the provisions of this Agreement that apply to the “Secured
Party.”

    


    (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.

    


    (h) All
questions concerning the construction, validity, enforcement and interpretation
of this Agreement shall be governed by and construed and enforced in accordance
with the internal laws of the State of New York, without regard to the
principles of conflicts of law thereof.  Each Debtor agrees that all
proceedings concerning the interpretations, enforcement and defense of the
transactions contemplated by this Agreement, the Transaction Documents and the
Notes (whether brought against a party hereto or its respective affiliates,
directors, officers, shareholders, partners, members, employees or agents) shall
be commenced exclusively in the state and federal courts sitting in the City of
New York, Borough of Manhattan. Each Debtor 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
proceeding, any claim that it is not personally subject to the jurisdiction of
any such court or that such proceeding is improper. Each party hereto hereby
irrevocably waives personal service of process and consents to process being
served in any such proceeding by mailing a copy thereof via registered or
certified mail or overnight delivery (with evidence of delivery) to such party
at the address in effect for notices to it under this Agreement and agrees that
such service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any right
to serve process in any manner permitted by law.  Each party hereto
hereby irrevocably waives, to the fullest extent permitted by applicable law,
any and all right to trial by jury in any legal proceeding arising out of or
relating to this Agreement or the transactions contemplated hereby. If any party
shall commence a proceeding to enforce any provisions of this Agreement, then
the prevailing party in such proceeding shall be reimbursed by the other party
for its reasonable attorney’s fees and other reasonable costs and expenses
incurred with the investigation, preparation and prosecution of such
proceeding.

     

     

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

    
 

    (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) All
Debtors shall jointly and severally be liable for the obligations of each Debtor
to the Secured Party hereunder.

    


    (k) Each
Debtor shall indemnify, reimburse and hold harmless the Secured Party and each
Lender, and each of their respective partners, members, shareholders, officers,
directors, employees and agents (and any other persons with other titles that
have similar functions) (collectively, “Indemnitees”) from and against any and
all losses, claims, liabilities, damages, penalties, suits, costs and expenses,
of any kind or nature, (including fees relating to the cost of investigating and
defending any of the foregoing) imposed on, incurred by or asserted against
such Indemnitee in any way related to or arising from or alleged to arise from
this Agreement or the Collateral, except any such losses, claims, liabilities,
damages, penalties, suits, costs and expenses which result from the gross
negligence or willful misconduct of the Indemnitee as determined by a final,
nonappealable decision of a court of competent jurisdiction.  This
indemnification provision is in addition to, and not in limitation of, any other
indemnification provision in the Notes, the Transaction Documents or any other
agreement, instrument or other document executed or delivered in connection
herewith or therewith.

    


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

    


    (m) 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 any Debtor or any direct or indirect
subsidiary of any Debtor or compliance with any provisions of any of the
Organizational Documents, the Debtors hereby grant such consent and approval and
waive any such noncompliance with the terms of said documents.

    


    (n) The
Lenders have, pursuant to the Purchase Agreement appointed the Agent, as their
agent for purposes of exercising any and all rights and remedies of the secured
parties hereunder.  Such appointment shall continue until revoked in
writing (with a copy delivered to the Debtors) in accordance with the Purchase
Agreement.

    


    [SIGNATURE
PAGES FOLLOW]

     

     

     

     

     

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

    
 

    


                IN WITNESS WHEREOF, the
parties hereto have caused this Security Agreement to be duly executed on
the day and year first above written.

    


    DEBTORS:

     

    URIGEN
PHARMACEUTICALS, INC.

     

    
      By: William J. Garner,
M.D. 

      
        
Name:
William J. Garner, M.D.

      Title:
Chief Executive Officer

    

     

     

    URIGEN N.A., INC.

     

     

    
      By:    /s/ Martin E.
Shmagin 

      
        
Name:
Martin E. Shmagin

      Title:
Chief Financial Officer

    

     

     

    SECURED PARTY:

     

    PLATINUM-MONTAUR LIFE SCIENCES,
LLC


     

    By:  /s/Michal M. Goldberg

    
      

      Name: Michael M. Goldberg

    
      Title:
Portfolio Manager

    

     

    SECURED PARTY:

     

    PLATINUM-MONTAUR LIFE SCIENCES,
LLC

     

    
      By: /s/Michal M.
Goldberg

      
        

      

      Name:
Michael M. Goldberg

      Title:
Portfolio Manager

    

     

     

     

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    

     

     

     

    SCHEDULE
A

    


    Place of
business and location of Collateral :

    


    Urigen
Pharmaceuticals, Inc.

    27 Maiden
Lane, Suite 595

    San
Francisco, CA 94108

     

     

     

     

     

     

     

     

     

    
 

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

    SCHEDULE
B

    Other
Owners or Collateral or Lienholders

    


    


    None

     

     

     

     

     

     

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

     

    
 

    SCHEDULE
C

    


    Delaware

    SCHEDULE
D

    Legal
Names and Organizational Identification Numbers

    


    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            	 
      	
                                    NAME

                                  	
                                    STAE
      OF ORGANIZATION

                                  	
                                    ID
      #

                                  	 
      
	 
      	
                                    Urigen
      Pharmaceuticals, Inc.

                                  	
                                    DE

                                  	
                                    4386481

                                  	 
      
	 	 	 	 	 
	 
      	
                                    Urigen
      N.A, Inc.

                                  	
                                    DE

                                  	
                                    4230347

                                  	 
      
	 
      	 
      	 
      	 
      	 
      


                          

                        

                      

                    

                  

                

              

            

          

        

      

    

    


     

     

     

     

     

     

     

     

     

     

     

     

     

    
      
        
        

      

      
        21

        
          

        

      

      
        
        

      

    

    
 

    SCHEDULE
E

    Names;
Mergers and Acquisitions

    


    Urigen
N.A, Inc. consummated a merger with a wholly owned subsidiary of Valentis, Inc.
on July 13, 1997.

    


    Urigen
Pharmaceuticals, Inc. was formerly known as Valentis, Inc.

     

     

     

     

     

     

     

     

     

     

     

    
      
        
        

      

      
        22

        
          

        

      

      
        
        

      

    

     

     

     

    SCHEDULE
F

    Intellectual
Property

    


    Patents
and Patent Applications

    


    Patent Filings for
URG101

     

    


     

    
      	
              1.  

            	
              Urigen
      Patent Application

            


    

     

    
      	
              Title:

            	
              “KITS
      AND IMPROVED COMPOSITIONS FOR TREATING LOWER URINARY TRACT
      DISORDERS”

            


    

     

    
      	
              Abstract:

            	
              Superior
      buffered formulations and their kits for treating lower urinary tract
      symptoms and disorders are provided in the invention. In particular
      superior buffered formulations have demonstrated improvement for treating
      lower urinary tract symptoms of patients experiencing severe pain and/or
      urgency of the bladder and associated areas of the lower urinary
      tract.

            


    

     

    
      	
              Inventor:

            	
              FLASHNER
      MICHAEL; FRANKLIN AMIE E; GARNER WILLIAM J; PARSONS C
    LOWELL

            


    

     

    
      	
              Assignee:

            	
              Urigen
      Pharmaceuticals, Inc.

            


    

     

    
      	
              Attorney:

            	
              Benjamin
      Borson, PhD, JD, Borson Law

            


    

     

    
      	
              Priority
      date:

            	
              U.S.
      Provisional Application Ser. No. 60/752,287 filed on Dec. 19, 2005 and PCT
      filing US 2006/001388 Jan. 13, 2006

            


    

     

    Jurisdictions:

     

    
      	
              1.  

            	
              United
      States - pending

            


    

     

    
      	
              2.  

            	
              Australia:
      2006204769 - pending

            


    

     

    
      	
              3.  

            	
              Europe:
      06718460.6 - pending

            


    

     

    
      	
              4.  

            	
              Japan:  -
      pending

            


    

     

    
      	
              5.  

            	
              Korea:
      10-2007-7018672 - pending

            


    

     

    
      	
              6.  

            	
              Canada
      – pending

            


    

     

    


     

    
      	
              2.  

            	
              UCSD
      Patent

            


    

     

    
      	
              Title:

            	
              “NOVEL
      INTERSTITIAL THERAPY FOR IMMEDIATE SYMPTOM RELIEF AND CHRONIC THERAPY IN
      INTERSTITIAL CYSTITIS”

            


    

     

    
      	
              Abstract:

            	
              The
      present invention relates to a disorder of the lower urinary tract, and in
      particular, reducing the symptoms (including treatment) of interstitial
      cystitis in vivo. In a preferred embodiment, the present invention relates
      to treatment formulations and methods for reducing interstitial cystitis
      in patients. In one embodiment, the present invention contemplates a
      composition comprising: a) a heparinoid, b) a local anesthetic, and c) a
      buffering compound.

            


    

     

     

     

    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

    

     

     

    
      	
              Inventor:

            	
              C.
      Lowell Parsons

            


    

     

    
      	
              Assignee:

            	
              The
      Regents of the University of
California

            


    

     

    
      	
              Licensee:

            	
              Urigen
      Pharmaceuticals

            


    

     

    
      	
              Attorney:

            	
              Steve
      Reiter, PhD, JD, Foley Lardner LLP

            


    

     

    
      	
              Priority
      date:

            	
              U.S.
      Provisional Application Ser. No. 60/540,186 filed on Jan. 28,
      2004

            


    

     

    Jurisdictions:

     

    
      	
              1.  

            	
              United
      States: US 7,414,039; additional composition of matter claims
      pending

            


    

     

    
      	
              2.  

            	
              Australia:
      AU2005209322 - pending

            


    

     

    
      	
              3.  

            	
              Canada:
      CA2554489 – pending

            


    

     

    
      	
              4.  

            	
              Europe:
      05712839.9 - pending

            


    

     

    


     

    Patent Filings for
URG300

     

    


    
      	
              1.  

            	
              Urigen
      Patent Application

            


    

     

    
      	
              Title:

            	
              Urethral
      Suppositories for Overactive
Bladder

            


    

     

    
      	
              Abstract:

            	
              This
      invention is directed to buffered urethral suppositories for treatment of
      overactive bladder (OAB), and methods for their use.  In
      particular, this invention relates to suppositories incorporating mixed
      anti-cholinergic agents and uses thereof to treat symptoms of overactive
      bladder.

            


    

     

    
      	
              Inventors:

            	
              Amie
      E Franklin, Dennis Giesing

            


    

     

    
      	
              Assignee:

            	
              Urigen
      Pharmaceuticals, Inc.

            


    

     

    
      	
              Attorney:

            	
              Benjamin
      Borson, PhD, JD, Borson Law

            


    

     

    
      	
              Priority
      date:

            	
              United
      States Provisional Patent Application No: 60/891,454, filed February 23,
      2007

            


    

     

    
      	
              Jurisdictions:

            	
              PCT,
      national stage filings not initiated
yet

            


    

     

    


     

    
      	
              2.  

            	
              Kalium
      U. S. Patent licensed by Urigen

            


    

     

    
      	
              Title:

            	
              Method
      of delivering therapeutic agents to the urethra and an urethral
      suppository

            


    

     

    
      	
              Abstract:

            	
              A
      urethral suppository having a shaft shaped for cooperating with the action
      of the periurethral musculature to retain the suppository within the
      urethra, and having a knob extending from an end of the shaft sized to
      prevent over insertion of the suppository. A method of delivering one or
      more therapeutic agents to the urethra and associated structures, the
      method involving insertion of the urethral suppository into the
      urethra.

            


    

     

    
      	
              Inventor:

            	
              Mulholland;
      S. Grant

            


    

     

    
      	
              Assignee:

            	
              Kalium,
      Inc.

            


    

     

    
      	
              Licensee:

            	
              Urigen
      Pharmaceuticals

            


    

     

    
      	
              Attorney:

            	
              Benjamin
      Borson, PhD, JD, Borson Law

            


    

     

    
      	
              Priority
      date:

            	
              November
      10, 1999

            


    

     

    
      	
              Jurisdiction:

            	
              United
      States issued Patent 6,464,670

            


    

     

    


     

    
      	
              3.  

            	
              Kalium
      U.S. Patent licensed by Urigen

            


    

     

    
      	
              Title:

            	
              Reinforced
      urethral suppository

            


    

     

    
      	
              Abstract:

            	
              A
      urethral suppository comprising a non-meltable base member sized to
      prevent insertion of the base member into the urethra, a non-meltable
      reinforcement projecting from the base member, and a meltable portion
      formed around a portion of the
reinforcement.

            


    

     

    
      	
              Inventors:

            	
              Mulholland;
      S. Grant, Zupkas; Paul

            


    

     

    
      	
              Assignee:

            	
              Kalium,
      Inc.

            


    

     

    
      	
              Licensee:

            	
              Urigen
      Pharmaceuticals

            


    

     

    
      	
              Attorney:

            	
              Benjamin
      Borson, PhD, JD, Borson Law

            


    

     

    
      	
              Priority
      date:

            	
              August
      30, 2001

            


    

     

    


     

    
      	
              Jurisdiction:

            	
              United
      States issued Patent 7,267,670

            


    

     

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

    

    


     

    
      	
              4.  

            	
              Kalium
      Patent Application licensed by
Urigen

            


    

     

    
      	
              Title:

            	
              Transluminal
      drug delivery methods and devices

            


    

     

    
      	
              Abstract:

            	
              A
      urethral suppository include a carrier base material, an anesthetic agent,
      and a buffering agent formed into a solid structure configured for
      insertion into a patient’s urethra for the treatment of interstitial
      cystitis or the prevention of pain prior to a urethral
      procedure.

            


    

     

    
      	
              Inventors:

            	
              C.
      Lowell Parsons, Paul Zupkas

            


    

     

    
      	
              Assignee:

            	
              Kalium,
      Inc.

            


    

     

    
      	
              Licensee:

            	
              Urigen
      Pharmaceuticals, Inc.

            


    

     

    
      	
              Attorney:

            	
              Benjamin
      Borson, PhD, JD, Borson Law

            


    

     

    
      	
              Priority
      date:

            	
              U.S.
      Application Ser. No. 340071 (20070172507) filed on January 26, 2006 and
      U.S. Divisional Application CIP  Ser. No.
      475809  (20070172508)

            


    

     

    Jurisdictions:

     

    
      	
              1.  

            	
              United
      States – pending

            


    

     

    
      	
              2.  

            	
              PCT
      –                      PCT/US2007/061106
      application number, publication No. W0 2007/087624 -
    pending

            


    

     

    


    Trademarks
and Trademark Applications

    


    


    There is
one registered trademark “Urigen” is a word mark, information from USPTO
provided below.

     

    
      	
               
      

            	
              Word
      Mark

            	
              URIGEN

            


    

     

    
      	
              Goods
      and Services

            	
              IC
      005. US 006 018 044 046 051 052. G & S: Pharmaceutical and medicinal
      preparations for the treatment of urological disorders. FIRST USE:
      20060101. FIRST USE IN COMMERCE:
20060101

            


    

     

    
      	
               
      

            	
              Standard
      Characters Claimed

            


    

     

    
      	
              Mark
      Drawing Code

            	
              (4)
      STANDARD CHARACTER MARK

            


    

     

    
      	
               
      

            	
              Serial
      Number

            	
              77014140

            


    

     

    
      	
               
      

            	
              Filing
      Date

            	
              October
      4, 2006

            


    

     

    
      	
              Current
      Filing Basis

            	
              1A

            


    

     

    
      	
              Original
      Filing Basis

            	
              1A

            


    

     

    
      	
              Published
      for Opposition

            	
              November
      6, 2007

            


    

     

    
      	
              Registration
      Number

            	
              3371356

            


    

     

    
      	
              International
      Registration Number

            	
              0921047

            


    

     

    
      	
               
      

            	
              Registration
      Date

            	
              January
      22, 2008

            


    

     

    
      	
               
      

            	
              Owner

            	
              (REGISTRANT)
      Urigen N.A., Inc. CORPORATION DELAWARE Suite 235 875 Mahler Road
      Burlingame CALIFORNIA 94010

            


    

     

    
      	
              Attorney
      of Record

            	
              David
      M. Kohn

            


    

     

    
      	
               
      

            	
              Type
      of Mark

            	
              TRADEMARK

            


    

     

    
      	
               
      

            	
              Register

            	
              PRINCIPAL

            


    

     

    
      	
              Live/Dead
      Indicator

            	
              LIVE

            


    

     

     

     

     

    
      
        
        

      

      
        25

        
          

        

      

      
        
        

      

    

     

     

    SCHEDULE
G

    Account
Debtors

    


    


    None

    SCHEDULE
H

    Pledged
Securities

    


    


    
      
        
          
            
              
                
                  	
                          Name
      Of Issuer/Guarantor

                        	
                          Type
      of Securities

                        	
                          No.
      of shares

                          owned

                        	
                          Percentage
      of Issuer owned

                        	
                          Stock
      Certificate

                          No.

                        
	
                          Urigen
      N.A, Inc.

                        	
                          Common
      Stock

                        	
                          1

                        	
                          100%

                        	
                          1

                        
	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      


                

              

            

          

        

      

    

    


    


    


    
      
        
        

      

      
        26

        
          

        

      

      
        
        

      

    

    


    


    ANNEX
A

    to

    SECURITY

    AGREEMENT

    


    
      	
               
      

            	
              FORM
      OF ADDITIONAL DEBTOR JOINDER

            


    

    


               Security
Agreement dated as of January 9, 2009 made by Urigen
Pharmaceuticals, Inc., and its subsidiaries party thereto from time to time, as
Debtors to and in favor of the Secured Party identified therein (the
“Security
Agreement”)

    


               Reference
is made to the Security Agreement as defined above; capitalized terms used
herein and not otherwise defined herein shall have the meanings given to such
terms in, or by reference in, the Security Agreement.

    


               The
undersigned hereby agrees that upon delivery of this Additional Debtor Joinder
to the Secured Party referred to above, the undersigned shall (a) be an
Additional Debtor under the Security Agreement, (b) have all the rights and
obligations of the Debtors under the Security Agreement as fully and to the same
extent as if the undersigned was an original signatory thereto and (c) be deemed
to have made the representations and warranties set forth therein as of the date
of execution and delivery of this Additional Debtor Joinder.  WITHOUT
LIMITING THE GENERALITY OF THE FOREGOING, THE UNDERSIGNED SPECIFICALLY GRANTS TO
THE SECURED PARTY A SECURITY INTEREST IN THE COLLATERAL AS MORE FULLY SET FORTH
IN THE SECURITY AGREEMENT AND ACKNOWLEDGES AND AGREES TO THE WAIVER OF JURY
TRIAL PROVISIONS SET FORTH THEREIN.

    


               Attached
hereto are supplemental and/or replacement Schedules to the Security Agreement,
as applicable.

    


               An
executed copy of this Joinder shall be delivered to the Secured Party, and the
Secured Party may rely on the matters set forth herein on or after the date
hereof.  This Joinder shall not be modified, amended or terminated
without the prior written consent of the Secured Party.

    


    
      	
               
      

            	 


    

               IN WITNESS WHEREOF, the
undersigned has caused this Joinder to be executed in the name and on behalf of
the undersigned.

    


    
      	 	
              [Name
      of Additional Debtor]

            


    

    


    
      	 	
              By:

            


    

    
      	 	
              Name:

            


    

    
      	 	
              Title:

            


    

    


    
      	 	
              Address:

            


    

     

    
      	
               
      

            	
              Dated:

            


    

    


    


     

     

     

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