**Exhibit 10.50**

 

**SECURITY AGREEMENT**

 

**THISSECURITY AGREEMENT** (the “Agreement”),****is entered into and made effective as of December       ,2007, by and between **SENESCO TECHNOLOGIES,INC.,**a Delaware corporationwith its principal place of business located at 303 George Street, Suite 420,New Brunswick, NJ 08901 (the “Parent”), and the each subsidiaryof the Parent listed on Schedule I attached hereto (each a “Subsidiary,”and collectively and together with the Parent, the “Company”), in favorof the **BUYER(S) **(the “SecuredParty”) listed on Schedule I attached to the Securities Purchase Agreement(the “Securities Purchase Agreement”) dated August 29, 2007 betweenthe Company and the Secured Party.

 

**WHEREAS,**the Parent shall issue and sell to the Secured Party, asprovided in the Securities Purchase Agreement, and the Secured Party shallpurchase secured convertible debentures (the “Convertible Debentures”),which shall be convertible into shares of the Parent’s common stock;

 

**WHEREAS,**to induce the Secured Party to enter into the transactioncontemplated by the Securities Purchase Agreement, the Convertible Debentures,the Registration Rights Agreement of even date herewith between the Parent andthe Secured Party (the “Registration Rights Agreement”), and the IrrevocableTransfer Agent Instructions among the Parent, the Secured Party, the Parent’stransfer agent, and James M.Davis (the “Transfer Agent Instructions”) (collectively referredto as the “Transaction Documents”), each Company hereby grants to theSecured Party a security interest in and to the pledged property of eachCompany identified on Exhibit A hereto (collectively referred to asthe “Pledged Property”) to secure all of the Obligations (as definedbelow);

 

**WHEREAS**, theCompany is entering into a Security Agreement with YA Global Investments, L.P.(“YA Global”) (the “YA Global Security Agreement”), which grants YAGlobal a first position security interest in and to the Pledged Property aheadof the grant of the security interest in and to the Pledged Property to theSecured Party hereunder; and

 

**WHEREAS**, theSecured Party and YA Global are entering into a subordination agreement (the “SubordinationAgreement”) describing the nature of the junior security interests grantedby the Company to the Secured Party hereunder and the senior security interestgranted to YA Global under the YA Global Security Agreement.

 

**NOW,THEREFORE,**in consideration of the promises and the mutualcovenants herein contained, and for other good and valuable consideration, theadequacy and receipt of which are hereby acknowledged, the parties heretohereby agree as follows:

 

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# **ARTICLE1.**

# ** **

**DEFINITIONS AND INTERPRETATIONS**

** **

## Section 1.1.                                  Recitals.

##  

The above recitals aretrue and correct and are incorporated herein, in their entirety, by thisreference.

 

## Section 1.2.                                  Interpretations.

##  

Nothing herein expressedor implied is intended or shall be construed to confer upon any person otherthan the Secured Party any right, remedy or claim under or by reason hereof.

 

## Section 1.3.                                  ObligationsSecured.

##  

The security interest created hereby in the PledgedProperty constitutes continuing collateral security for all of the obligationsof the Parent now existing or hereinafter incurred to the Buyers under theTransaction Documents and whether arising before, on or after the date hereofincluding, without limitation following obligations (collectively, the “Obligations”):

 

(a)  for so long as the Convertible Debentures are outstanding,the payment by the Parent, as and when due and payable (by scheduled maturity,acceleration, demand or otherwise), of all amounts from time to time owing byit in respect of the Securities Purchase Agreement, the Convertible Debenturesand the other Transaction Documents;and

 

(b)              for solong as the Convertible Debentures are outstanding, the due performance andobservance by the Parent of all of its other obligations from time to timeexisting in respect of any of the Transaction Documents, including withoutlimitation, the Parent’s obligations with respect to any conversion orredemption rights of the Secured Party under the Convertible Debentures.

 

# **ARTICLE2.**

# ** **

**PLEDGED PROPERTY; EVENT OF DEFAULT**

** **

## Section 2.1.                                  PledgedProperty.

##  

###### (a)                                 Ascollateral security for all of the Obligations, the Company hereby pledges tothe Secured Party, and creates in the Secured Party for its benefit, acontinuing security interest in and to all of the Pledged Property whether nowowned or hereafter acquired.

######  

###### (b)                                Withoutlimiting the generality of the foregoing, as additional security for thepayment and performance of the Obligations, each Company hereby grants to theSecured Party a continuing security interest in, and hereby collaterallyassigns to the Secured Party, all of such Company’s right, title and interestin and to each 

 

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###### Deposit Account (as defined below) and in and to anydeposits or other sums at any time credited to each such Deposit Account.  In connection with the foregoing, eachCompany hereby authorizes and directs each bank or other depository institutionwhich maintains any Deposit Account to pay or deliver to the Secured Party uponthe Secured Party’s written demand thereof made at any time after theoccurrence of an Event of Default has occurred all balances in each DepositAccount with such depository for application to the Obligations thenoutstanding.

######  

###### (c)                                 Simultaneouslywith the execution and delivery of this Agreement, the Company shall make,execute, acknowledge, file, record and deliver to the Secured Party anydocuments reasonably requested by the Secured Party to perfect its securityinterest in the Pledged Property. Simultaneously with the execution and delivery of this Agreement, theCompany shall make, execute, acknowledge and deliver to the Secured Party suchdocuments and instruments, including, without limitation, financing statements,certificates, affidavits and forms as may, in the Secured Party’s reasonablejudgment, be necessary to effectuate, complete or perfect, or to continue andpreserve, the security interest of the Secured Party in the Pledged Property,and the Secured Party shall hold such documents and instruments as securedparty, subject to the terms and conditions contained herein.

######  

## Section 2.2.                                  Eventof Default.

##  

###### An “Event of Default”shall be deemed to have occurred under this Agreement upon an Event of Defaultunder and as defined in the Convertible Debentures.

######  

## Section 2.3                                     Grantof Security Interest to YA Global.

##  

###### The Company is granting asecurity interest in and to the Pledged Property to YA Global under the YAGlobal Security Agreement.  The securityinterests granted by the Company to the Secured Party hereunder shall be juniorto the security interest granted by the Company to YA Global under the YAGlobal Security Agreement irrespective of priority, regardless of the date,manner, or order of perfection of the respective security interests, liens andencumbrances granted or to be granted by the Company to or for the benefit ofthe Secured Party hereunder or YA Global under the YA Global SecurityAgreement.  So long as this Agreementshall remain in effect, the security interests, liens, and encumbrances grantedto the Secured Party shall be junior to the security interests, liens and encumbrancesof granted to YA Global.  The SecuredParty and YA Global are entering into the Subordination Agreement furtherdescribing the ranking**of thesecurity interests granted by the Company to the Secured Party hereunder and toYA Global under the YA Global Security Agreement.

 

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# **ARTICLE3.**

# ** **

**ATTORNEY-IN-FACT; PERFORMANCE**

** **

## Section 3.1.                                  SecuredParty Appointed Attorney-In-Fact.

##  

Upon the occurrence andduring the continuance of an Event of Default: (a) the Company herebyappoints the Secured Party as its attorney-in-fact, with full authority in theplace and stead of the Company and in the name of the Company or otherwise,from time to time in the Secured Party’s discretion to take any action and toexecute any instrument which the Secured Party may reasonably deem necessary toaccomplish the purposes of this Agreement, including, without limitation, toreceive and collect all instruments made payable to the Company representingany payments in respect of the Pledged Property or any part thereof and to givefull discharge for the same; (b) the Secured Party may demand, collect,receipt for, settle, compromise, adjust, sue for, foreclose, or realize on thePledged Property as and when the Secured Party may determine, and (c) tofacilitate collection, the Secured Party may notify account debtors andobligors on any Pledged Property to make payments directly to the SecuredParty.

 

## Section 3.2.                                  SecuredParty May Perform.

##  

If the Company fails toperform any agreement contained herein, the Secured Party, at its option, mayitself perform, or cause performance of, such agreement, and the expenses ofthe Secured Party incurred in connection therewith shall be included in theObligations secured hereby and payable by the Company under Section 8.3.

 

# **ARTICLE4.**

# ** **

**REPRESENTATIONS AND WARRANTIES**

** **

## Section 4.1.                                  Authorization;Enforceability.

##  

Each of the partieshereto represents and warrants that it has taken all action necessary toauthorize the execution, delivery and performance of this Agreement and thetransactions contemplated hereby; and upon execution and delivery, thisAgreement shall constitute a valid and binding obligation of the respectiveparty, subject to applicable bankruptcy, insolvency, reorganization, moratoriumand similar laws affecting creditors’ rights or by the principles governing theavailability of equitable remedies.

 

## Section 4.2.                                  Ownershipof Pledged Property.

##  

The Company representsand warrants that it is the legal and beneficial owner of the Pledged Propertyfree and clear of any lien, security interest, option or other charge orencumbrance (each, a “Lien”) except for the security interest created bythis Agreement and other Permitted Liens. For purposes of this Agreement, “Permitted Liens” means: (1) thesecurity interest created by this Agreement and the YA Global SecurityAgreement, (2) existing Liens disclosed by the Company to the SecuredParty; (3) inchoate Liens for taxes, assessments or governmental chargesor levies not yet due, as to which the grace period, if any, related theretohas not yet expired, or being contested in 

 

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good faith and by appropriate proceedings for whichadequate reserves have been established in accordance with GAAP; (4) Liensof carriers, materialmen, warehousemen, mechanics and landlords and othersimilar Liens which secure amounts which are not yet overdue by more than 60days or which are being contested in good faith by appropriate proceedings; (5) licenses,sublicenses, leases or subleases granted to other Persons not materiallyinterfering with the conduct of the business of the Company; (6) Lienssecuring capitalized lease obligations and purchase money indebtedness incurredsolely for the purpose of financing an acquisition or lease; (7) easements,rights-of-way, restrictions, encroachments, municipal zoning ordinances andother similar charges or encumbrances, and minor title deficiencies, in eachcase not securing debt and not materially interfering with the conduct of thebusiness of the Company and not materially detracting from the value of theproperty subject thereto; (8) Liens arising out of the existence ofjudgments or awards which judgments or awards do not constitute an Event ofDefault; (9) Liens incurred in the ordinary course of business inconnection with workers compensation claims, unemployment insurance, pensionliabilities and social security benefits and Liens securing the performance ofbids, tenders, leases and contracts in the ordinary course of business,statutory obligations, surety bonds, performance bonds and other obligations ofa like nature (other than appeal bonds) incurred in the ordinary course ofbusiness (exclusive of obligations in respect of the payment for borrowedmoney); (10) Liens in favor of a banking institution arising by operationof law encumbering deposits (including the right of set-off) and contractualset-off rights held by such banking institution and which are within thegeneral parameters customary in the banking industry and only burdening depositaccounts or other funds maintained with a creditor depository institution; (11)usual and customary set-off rights in leases and other contracts; and (12)escrows in connection with acquisitions and dispositions.

 

# **ARTICLE5.**

# ** **

**DEFAULT; REMEDIES; SUBSTITUTE COLLATERAL**

** **

## Section 5.1                                     Methodof Realizing Upon the Pledged Property: Other Remedies.

##  

If any Event of Defaultshall have occurred and be continuing:

 

(a)                                 TheSecured Party may exercise in respect of the Pledged Property, in addition toany other rights and remedies provided for herein or otherwise available to it,all of the rights and remedies of a secured party upon default under theUniform Commercial Code (whether or not the Uniform Commercial Code applies to theaffected Pledged Property), and also may (i) take absolute control of thePledged Property, including, without limitation, transfer into the SecuredParty’s name or into the name of its nominee or nominees (to the extent theSecured Party has not theretofore done so) and thereafter receive, for thebenefit of the Secured Party, all payments made thereon, give all consents,waivers and ratifications in respect thereof and otherwise act with respectthereto as though it were the outright owner thereof, (ii) require theCompany to assemble all or part of the Pledged Property as directed by theSecured Party and make it available to the Secured Party at a place or placesto be designated by the Secured Party that is reasonably convenient to bothparties, and the Secured Party may enter into and occupy any premises owned orleased by the Company where the Pledged Property or any part 

 

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thereof is located or assembled for a reasonableperiod in order to effectuate the Secured Party’s rights and remedies hereunderor under law, without obligation to the Company in respect of such occupation,and (iii) without notice except as specified below and without anyobligation to prepare or process the Pledged Property for sale, (A) sellthe Pledged Property or any part thereof in one or more parcels at public orprivate sale, at any of the Secured Party’s offices or elsewhere, for cash, oncredit or for future delivery, and at such price or prices and upon such otherterms as the Secured Party may deem commercially reasonable and/or (B) lease,license or dispose of the Pledged Property or any part thereof upon such termsas the Secured Party may deem commercially reasonable.  The Company agrees that, to the extent noticeof sale or any other disposition of the Pledged Property shall be required bylaw, at least ten (10) days’ notice to the Company of the time and placeof any public sale or the time after which any private sale or otherdisposition of the Pledged Property is to be made shall constitute reasonablenotification.  The Secured Party shallnot be obligated to make any sale or other disposition of any Pledged Propertyregardless of notice of sale having been given. The Secured Party may adjourn any public or private sale from time totime by announcement at the time and place fixed therefor, and such sale may,without further notice, be made at the time and place to which it was soadjourned.  The Company hereby waives anyclaims against the Secured Party arising by reason of the fact that the priceat which the Pledged Property may have been sold at a private sale was lessthan the price which might have been obtained at a public sale or was less thanthe aggregate amount of the Obligations, even if the Secured Party accepts thefirst offer received and does not offer such Pledged Property to more than oneofferee, and waives all rights that the Company may have to require that all orany part of such Pledged Property be marshaled upon any sale (public orprivate) thereof.  The Company herebyacknowledges that (i) any such sale of the Pledged Property by the SecuredParty may be made without warranty, (ii) the Secured Party mayspecifically disclaim any warranties of title, possession, quiet enjoyment orthe like, and (iii) such actions set forth in clauses (i) and (ii) aboveshall not adversely affect the commercial reasonableness of any such sale ofPledged Property.

 

(b)                                Anycash held by the Secured Party as Pledged Property and all cash proceedsreceived by the Secured Party in respect of any sale of or collection from, orother realization upon, all or any part of the Pledged Property shall beapplied (after payment of any amounts payable to the Secured Party pursuant to Section 8.3hereof) by the Secured Party against, all or any part of the Obligations insuch order as the Secured Party shall elect, consistent with the provisions ofthe Securities Purchase Agreement.  Anysurplus of such cash or cash proceeds held by the Secured Party and remainingafter the indefeasible payment in full in cash of all of the Obligations shallbe paid over to whomsoever shall be lawfully entitled to receive the same or asa court of competent jurisdiction shall direct.

 

(c)                                 Inthe event that the proceeds of any such sale, collection or realization areinsufficient to pay all amounts to which the Secured Party is legally entitled,the Company shall be liable for the deficiency, together with interest thereonat the rate specified in the Convertible Debentures for interest on overdue principalthereof or such other rate as shall be fixed by applicable law, together withthe costs of collection and the 

 

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reasonable fees, costs, expenses and other clientcharges of any attorneys employed by the Secured Party to collect suchdeficiency.

 

(d)                                TheCompany hereby acknowledges that if the Secured Party complies with anyapplicable state, provincial, or federal law requirements in connection with adisposition of the Pledged Property, such compliance will not adversely affectthe commercial reasonableness of any sale or other disposition of the PledgedProperty.

 

(e)                                 TheSecured Party shall not be required to marshal any present or future collateralsecurity (including, but not limited to, this Agreement and the PledgedProperty) for, or other assurances of payment of, the Obligations or any ofthem or to resort to such collateral security or other assurances of payment inany particular order, and all of the Secured Party’s rights hereunder and inrespect of such collateral security and other assurances of payment shall becumulative and in addition to all other rights, however existing orarising.  To the extent that the Companylawfully may, the Company hereby agrees that it will not invoke any lawrelating to the marshaling of collateral which might cause delay in or impedethe enforcement of the Secured Party’s rights under this Agreement or under anyother instrument creating or evidencing any of the Obligations or under whichany of the Obligations is outstanding or by which any of the Obligations issecured or payment thereof is otherwise assured, and, to the extent that itlawfully may, the Company hereby irrevocably waives the benefits of all suchlaws.

 

## Section 5.2                                     DutiesRegarding Pledged Property.

##  

The Secured Party shallhave no duty as to the collection or protection of the Pledged Property or anyincome thereon or as to the preservation of any rights pertaining thereto,beyond the safe custody and reasonable care of any of the Pledged Propertyactually in the Secured Party’s possession.

 

# **ARTICLE6.**

# ** **

**AFFIRMATIVE COVENANTS**

** **

The Company covenants andagrees that, from the date hereof and until the Obligations have been fullypaid and satisfied or the Convertible Debentures have been fully converted,unless the Secured Party shall consent otherwise in writing (as provided in Section 8.4hereof):

 

## Section 6.1.                                  Existence,Properties, Etc.

##  

###### (a)                                  TheCompany shall do, or cause to be done, all things, or proceed with duediligence with any actions or courses of action, that may be reasonablynecessary (i) to maintain Company’s due organization, valid existence andgood standing under the laws of its state of incorporation, and (ii) topreserve and keep in full force and effect all qualifications, licenses andregistrations in those jurisdictions in which the failure to do so could have aMaterial Adverse Effect (as defined below); and (b) the Company shall notdo, or cause to be done, any act impairing the Company’s corporate power orauthority (i) to carry on the Company’s business as now conducted, and (ii) to

 

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###### execute or deliver this Agreement or any otherdocument delivered in connection herewith, including, without limitation, anyUCC-1 Financing Statements required by the Secured Party (which other loaninstruments collectively shall be referred to as the “Loan Instruments”) towhich it is or will be a party, or perform any of its obligations hereunder orthereunder.  For purpose of this Agreement,the term “Material Adverse Effect” shall mean any material and adverseaffect as determined by Secured Party in its reasonable discretion, whetherindividually or in the aggregate, upon (a) the Company’s assets, business,operations, properties or condition, financial or otherwise; (b) theCompany’s ability to make payment as and when due of all or any part of theObligations; or (c) the Pledged Property.

######  

## Section 6.2.                                  FinancialStatements and Reports.

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The Company shall furnishto the Secured Party within a reasonable time such financial data as theSecured Party may reasonably request.

 

## Section 6.3.                                  Accountsand Reports.

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The Company shallmaintain a standard system of accounting in accordance with generally acceptedaccounting principles consistently applied (“GAAP”) and provide, at itssole expense, to the Secured Party the following:

 

###### (a)                                 assoon as available, a copy of any notice or other communication alleging anynonpayment or other material breach or default, or any foreclosure or otheraction respecting any material portion of its assets and properties, receivedrespecting any of the indebtedness of the Company in excess of $500,000 (otherthan the Obligations), or any demand or other request for payment under anyguaranty, assumption, purchase agreement or similar agreement or arrangementrespecting the indebtedness or obligations of others in excess of $500,000; and

######  

###### (b)                                withinfifteen (15) days after the making of each submission or filing, a copy ofany report, financial statement, notice or other document, whether periodic orotherwise, submitted to the shareholders of the Company, or submitted to orfiled by the Company with any governmental authority involving or affecting (i) theCompany that could reasonably be expected to have a Material Adverse Effect; (ii) theObligations; (iii) any part of the Pledged Property; or (iv) any ofthe transactions contemplated in this Agreement or the Loan Instruments(except, in each case, to the extent any such submission, filing, report,financial statement, notice or other document is posted on EDGAR Online).

######  

## Section 6.4.                                  Maintenanceof Books and Records; Inspection.

##  

The Company shallmaintain its books, accounts and records in accordance with GAAP, and permitthe Secured Party, its officers and employees and any professionals designatedby the Secured Party in writing, at any time during normal business hours andupon reasonable notice to visit and inspect any of its properties (includingbut not limited to the collateral security described in the TransactionDocuments and/or the Loan Instruments), corporate books and financial records,and to discuss its accounts, affairs 

 

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and finances with any employee, officer or directorthereof (it being agreed that, unless an Event of Default shall have occurredand be continuing, there shall be no more than two (2) such visits andinspections in any Fiscal Year).

 

## Section 6.5.                                  Maintenanceand Insurance.

##  

###### (a)                                 TheCompany shall maintain or cause to be maintained, at its own expense, all ofits material assets and properties in good working order and condition,ordinary wear and tear excepted, making all necessary repairs thereto andrenewals and replacements thereof.

######  

###### (b)                                TheCompany shall maintain or cause to be maintained, at its own expense, insurancein form, substance and amounts (including deductibles), which the Company deemsreasonably necessary to the Company’s business, (i) adequate to insure allassets and properties of the Company of a character usually insured by personsengaged in the same or similar business against loss or damage resulting fromfire or other risks included in an extended coverage policy; (ii) againstpublic liability and other tort claims that may be incurred by the Company; (iii) asmay be required by the Transaction Documents and/or applicable law and (iv) asmay be reasonably requested by Secured Party, all with financially sound andreputable insurers.

######  

## Section 6.6.                                  Contractsand Other Collateral.

##  

The Company shall performall of its obligations under or with respect to each instrument, receivable,contract and other intangible included in the Pledged Property to which theCompany is now or hereafter will be party on a timely basis and in the mannertherein required, including, without limitation, this Agreement, except to theextent the failure to so perform such obligations would not reasonably beexpected to have a Material Adverse Effect.

 

## Section 6.7.                                  Defenseof Collateral, Etc.

##  

The Company shall defendand enforce its right, title and interest in and to any part of:  (a) the Pledged Property; and (b) ifnot included within the Pledged Property, those assets and properties whoseloss would reasonably be expected to have a Material Adverse Effect, eachagainst all manner of claims and demands on a timely basis to the full extentpermitted by applicable law (other than any such claims and demands by holdersof Permitted Liens).

 

## Section 6.8.                                  Taxesand Assessments.

##  

The Company shall (a) fileall material tax returns and appropriate schedules thereto that are required tobe filed under applicable law, prior to the date of delinquency (taking intoaccount any extensions of the original due date), (b) pay and dischargeall material taxes, assessments and governmental charges or levies imposed uponthe Company, upon its income and profits or upon any properties belonging toit, prior to the date on which penalties attach thereto, and (c) pay allmaterial taxes, assessments and governmental charges or levies that, if unpaid,might become a lien or charge upon any of 

 

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its properties; *provided,however*, that the Company in good faith may contest any such tax,assessment, governmental charge or levy described in the foregoing clauses (b) and(c) so long as appropriate reserves are maintained with respect thereto ifand to the extent required by GAAP.

 

## Section 6.9.                                  Compliancewith Law and Other Agreements.

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The Company shallmaintain its business operations and property owned or used in connectiontherewith in compliance with (a) all applicable federal, state and locallaws, regulations and ordinances governing such business operations and the useand ownership of such property, and (b) all agreements, licenses,franchises, indentures and mortgages to which the Company is a party or bywhich the Company or any of its properties is bound, except where the failureto so comply would not reasonably be expected to have a Material AdverseEffect.

 

## Section 6.10.                            Noticeof Default.

##  

The Company shall givewritten notice to the Secured Party of the occurrence of any Event of Default.

 

## Section 6.11.                            Noticeof Litigation.

##  

The Company shall givenotice, in writing, to the Secured Party of (a) any actions, suits orproceedings wherein the amount at issue is in excess of $250,000, instituted byany persons against the Company, or affecting any of the assets of the Company,and (b) any dispute, not resolved within fifteen (15) days of thecommencement thereof, between the Company on the one hand and any governmentalor regulatory body on the other hand, which might reasonably be expected tohave a Material Adverse Effect on the business operations or financialcondition of the Company.

 

Section 6.13.                            FutureSubsidiaries.

 

If the Company shallhereafter create or acquire any subsidiary, simultaneously with the creation oracquisition of such subsidiary, the Company shall cause such subsidiary togrant to the Secured Party a security interest of the same tenor as createdunder this Agreement.

 

Section 6.14.                            Establishment of DepositAccount, Dominion Account Agreements.

 

Within ten (10) daysof the date hereof, each Company, the Secured Party, and each applicable bankor other depository institution shall enter into a deposit account agreement (“DepositAccount Agreement”) in the form of Exhibit B with respect to each ofthe Company’s savings, passbook, money market or other depository accounts, andall certificates of deposit, maintained by each Company with any bank, savingsand loan association, credit union or other depository institution (each, a “DepositAccount”) maintained or used by each Company providing dominion and controlover such accounts to the Secured Party such that upon notice by the SecuredParty to such bank or other 

 

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depository institution of the occurrence of an Eventof Default all actions under such account shall be taken solely at the SecuredParty’s direction.  Each Company’scurrent Deposit Accounts are set forth on Schedule 6.14 attached hereto.

 

Each Company shall causeall cash, all collections and proceeds from accounts receivable, all receiptsfrom credit card payments, and all proceeds from the sale of any PledgedProperty to be deposited into a Deposit Account in the ordinary course ofbusiness and consistent with past practices.

 

While any ConvertibleDebentures remain outstanding, the Company shall have valid and effectiveDeposit Account Agreements in place at all times with respect to all of itsDeposit Accounts.  No Deposit Accountshall be established, used or maintained by the Company unless it first entersinto a Deposit Account Agreement.

 

With respect to eachDeposit Account, from an after the occurrence of an Event of Default, theSecured Party shall have the right, at any time and from time to time, toexercise its rights under such Deposit Account Agreement, including, for theavoidance of any doubt, the exclusive right to give instructions to thefinancial institution at which such Deposit Account is maintained as to the dispositionof funds or other property on deposit therein or credited thereto.  The Secured Party hereby covenants and agreesthat it will not send any such notice to a financial institution at which anysuch Deposit Account is maintained directing the disposition of funds or otherproperty therein unless and until the occurrence of an Event of Default.

 

# **ARTICLE7.**

# ** **

**NEGATIVE COVENANTS**

** **

The Company covenants andagrees that, from the date hereof until the Obligations have been fully paidand satisfied, the Company shall not, unless the Secured Party shall consentotherwise in writing:

 

Section 7.1.                                  Liensand Encumbrances.

 

Directly or indirectlymake, create, incur, assume or permit to exist any Lien in, to or against anypart of the Pledged Property other than Permitted Liens.

 

Section 7.2.                                  Restrictionon Redemption and Cash Dividends

 

Directly or indirectly,redeem, repurchase or declare or pay any cash dividend or distribution on itscapital stock without the prior express written consent of the Secured Party.

 

Section 7.3.                                  Incurrenceof Indebtedness.

 

Directlyor indirectly, incur or guarantee, assume or suffer to exist any indebtedness,other than the indebtedness evidenced by the Convertible Debentures and 

 

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other Permitted Indebtedness.  “Permitted Indebtedness” means: (i) indebtednessevidenced by Convertible Debentures and indebtedness to YA Global pursuant tothe YA Global Closing (as defined in the Securities Purchase Agreement); (ii) indebtednessdescribed on the Disclosure Schedule to the Securities Purchase Agreement; (iii) indebtednessincurred solely for the purpose of financing the acquisition or lease of anyequipment by the Company, including capital lease obligations with no recourseother than to such equipment; (iv) indebtedness (A) the repayment ofwhich has been subordinated to the payment of the Convertible Debentures onterms and conditions acceptable to the Secured Party, including with regard tointerest payments and repayment of principal, (B) which does not mature orotherwise require or permit redemption or repayment prior to or on the 91stday after the maturity date of any Convertible Debentures then outstanding; and(C) which is not secured by any assets of the Company; (v) indebtednesssolely between the Company and/or one of its domestic subsidiaries, on the onehand, and the Company and/or one of its domestic subsidiaries, on the otherwhich indebtedness is not secured by any assets of the Company or any of itssubsidiaries, provided that (x) in each case a majority of the equity ofany such domestic subsidiary is directly or indirectly owned by the Company,such domestic subsidiary is controlled by the Company and such domesticsubsidiary has executed a security agreement in the form of this Agreement and (y) any such loan shall beevidenced by an intercompany note that is pledged by the Company or itssubsidiary, as applicable, as collateral pursuant to this Agreement; (vi) reimbursementobligations in respect of letters of credit issued for the account of theCompany or any of its subsidiaries for the purpose of securing performanceobligations of the Company or its subsidiaries incurred in the ordinary courseof business so long as the aggregate face amount of all such letters of creditdoes not exceed $500,000 at any one time; and (vii) renewals, extensionsand refinancing of any indebtedness described in clauses (i) or (iii) ofthis subsection.

 

Section 7.4.                                  Placesof Business.

 

Change the location ofits chief place of business, chief executive office or any place of businessdisclosed to the Secured Party, unless such change in location is to adifferent location within the United States and the Company provides notice tothe Secured Party of new location within 10 days’ of such change in location.

 

# **ARTICLE8.**

# ** **

**MISCELLANEOUS**

** **

## Section 8.1.                                  Notices.

##  

All notices or othercommunications required or permitted to be given pursuant to this Agreementshall be in writing and shall be considered as duly given on:  (a) the date of delivery, if deliveredin person or by nationally recognized overnight delivery service or (b) five (5) daysafter mailing if mailed from within the continental United States by certifiedmail, return receipt requested to the party entitled to receive the same:

 

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| If to the  Secured Party: |   | Stanford Venture  Capital Holdings, Inc. |
|---------------------------|--------|-----------------------------------------------|
|                      |   | 6075 Poplar  Avenue, Suite 300           |
|                      |   | Memphis, TN  38119                            |
|                      |   | Attention:                                    | James M. Davis |
|                      |   |                                          | President and  Director |
|                      |   | Telephone:                                    | (901)  537-1600 |
|                      |   | Facsimile:                                    | (901) 680-5265 |
|                      |   |                                          |
| With a copy to:           |   | Akerman  Senterfitt                           |
|                      |   | One Southeast  Third Avenue, 25th Floor  |
|                      |   | Miami, FL 33131                               |
|                      |   | Attention:                                    | Jose  Gordo, Esq. |
|                      |   | Telephone:                                    | (305) 755-5812 |
|                      |   | Facsimile:                                    | (305) 349-4789 |
|                      |   |                                          |
| And if to the  Company:   |   | Senesco  Technologies, Inc.              |
|                      |   | 303 George  Street, Suite 420            |
|                      |   | New Brunswick,  NJ 08901                      |
|                      |   | Attention:                                    | Chief Executive  Officer |
|                      |   | Telephone:                                    |   |
|                      |   | Facsimile:                                    |   |
|                      |   |                                          |
| With a copy to:           |   | Morgan,  Lewis & Bochius             |
|                      |   | 502 Carnegie  Center                          |
|                      |   | Princeton, NJ  08540                          |
|                      |   | Attention:                                    |   |
|                      |   | Telephone:                                    | (609) 919-6633 |
|                      |   | Facsimile:                                    | (609) 919-6701 |

 

Any party may change itsaddress by giving notice to the other party stating its new address.  Commencing on the tenth (10th) day after the giving ofsuch notice, such newly designated address shall be such party’s address forthe purpose of all notices or other communications required or permitted to begiven pursuant to this Agreement.

 

## Section 8.2.                                  Severability.

##  

If any provision of thisAgreement shall be held invalid or unenforceable, such invalidity orunenforceability shall attach only to such provision and shall not in anymanner affect or render invalid or unenforceable any other severable provisionof this Agreement, and this Agreement shall be carried out as if any suchinvalid or unenforceable provision were not contained herein.

 

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## Section 8.3.                                  Expenses.

##  

In the event of an Eventof Default, the Company will pay to the Secured Party the amount of any and allreasonable out-of-pocket expenses, including the reasonable fees and expensesof its counsel, which the Secured Party may incur in connection with:  (i) the custody or preservation of, orthe sale, collection from, or other realization upon, any of the PledgedProperty; (ii) the exercise or enforcement of any of the rights of theSecured Party hereunder or (iii) the failure by the Company to perform orobserve any of the provisions hereof.

 

## Section 8.4.                                  Waivers,Amendments, Etc.

##  

The Secured Party’s delayor failure at any time or times hereafter to require strict performance byCompany of any undertakings, agreements or covenants shall not waive, affect,or diminish any right of the Secured Party under this Agreement to demandstrict compliance and performance herewith. Any waiver by the Secured Party of any Event of Default shall not waiveor affect any other Event of Default, whether such Event of Default is prior orsubsequent thereto and whether of the same or a different type.  None of the undertakings, agreements andcovenants of the Company contained in this Agreement, and no Event of Default,shall be deemed to have been waived by the Secured Party, nor may thisAgreement be amended, changed or modified, unless such waiver, amendment,change or modification is evidenced by an instrument in writing specifying suchwaiver, amendment, change or modification and signed by the Secured Party inthe case of any such waiver, and signed by the Secured Party and the Company inthe case of any such amendment, change or modification.

 

## Section 8.5.                                  ContinuingSecurity Interest; Partial Release.

##  

(a)                                 ThisAgreement shall create a continuing security interest in the Pledged Propertyand shall: (i) remain in full force and effect until payment or conversionin full of the Convertible Debentures; (ii) be binding upon the Companyand its successors and assigns; and (iii) inure to the benefit of theSecured Party and its successors and assigns. Upon the payment or satisfaction in full or conversion in full of theConvertible Debentures, this Agreement and the security interest created herebyshall terminate, and, in connection therewith, the Company shall be entitled tothe return, at its expense, of such of the Pledged Property as shall not havebeen sold in accordance with Section 5.2 hereof or otherwise appliedpursuant to the terms hereof and the Secured Party shall deliver to the Companysuch documents as the Company shall reasonably request to evidence suchtermination.

 

(b)                                Effectiveupon the closing of a disposition of any Pledged Property, provided the SecuredParty consents in writing prior to such disposition or such disposition is madein the ordinary course of business, the security interest granted hereunder inthe Pledged Property so disposed of shall terminate and the Secured Party shalldeliver such documents as the Company shall reasonably request to evidence suchtermination; provided, however, the security interest granted hereunder in allremaining Pledged Property shall remain in full force and effect.

 

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## Section 8.6.                                  IndependentRepresentation.

##  

Each party heretoacknowledges and agrees that it has received or has had the opportunity toreceive independent legal counsel of its own choice and that it has beensufficiently apprised of its rights and responsibilities with regard to thesubstance of this Agreement.

 

## Section 8.7.                                  ApplicableLaw:  Jurisdiction.

##  

This Agreement shall begoverned by and interpreted in accordance with the laws of the State of NewJersey without regard to the principles of conflict of laws.  The parties further agree that any actionbetween them shall be heard in Hudson County, New Jersey, and expressly consentto the jurisdiction and venue of the Superior Court of New Jersey, sitting inHudson County and the United States District Court for the District of NewJersey sitting in Newark, New Jersey for the adjudication of any civil actionasserted pursuant to this Paragraph.

 

## Section 8.8.                                  Waiverof Jury Trial.

##  

AS A FURTHER INDUCEMENTFOR THE SECURED PARTY TO ENTER INTO THIS AGREEMENT AND TO MAKE THE FINANCIALACCOMMODATIONS TO THE COMPANY, THE COMPANY HEREBY WAIVES ANY RIGHT TO TRIAL BYJURY IN ANY LEGAL PROCEEDING RELATED IN ANY WAY TO THIS AGREEMENT AND/OR ANYAND ALL OTHER DOCUMENTS RELATED TO THIS TRANSACTION.

 

## Section 8.9.                                  EntireAgreement.

##  

This Agreementconstitutes the entire agreement among the parties and supersedes any prioragreement or understanding among them with respect to the subject matterhereof.

 

**[REMAINDER OF PAGE INTENTIONALLY LEFTBLANK]**

 

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**INWITNESS WHEREOF,**the parties hereto have executed thisSecurity Agreement as of the date first above written.

 

 
| ** ** | **COMPANY:**                                  |
|------------|-----------------------------------------------|
| ** ** | **SENESCO  TECHNOLOGIES, INC.**               |
|       |                                          |
|       | By:                                           |  /s/ Bruce C. Galton |
|       | Name: Bruce C. Galton                    |
|       | Title:    President  & CEO |

 

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**INWITNESS WHEREOF,**the parties hereto have executed thisSecurity Agreement as of the date first above written.

 

 
| ** ** | **COMPANY:**                       |
|------------|------------------------------------|
| ** ** | **SENESCO,  INC.**                 |
|       |                               |
|       | By:                                |  /s/ Bruce C. Galton |
|       | Name: Bruce C. Galton         |
|       | Title:    President |

 

17

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**INWITNESS WHEREOF,**the parties hereto have executed thisSecurity Agreement as of the date first above written.

 

 
| ** ** | **SECURED  PARTY:**                              |
|------------|--------------------------------------------------|
| ** ** | **STANFORD  VENTURE CAPITAL HOLDINGS,**          |
| ** ** | **INC.**                                         |
|       |                                             |
|       |                                             |
|       | By:                                              |  /s/ James M. Davis |
|       | Name: James M. Davis                        |
|       | Title:    President  and Director |

 

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SCHEDULE I

 

LEGAL NAMES; ORGANIZATIONAL IDENTIFICATION NUMBERS;STATES OF ORGANIZATION

 
| **Company’s Name**    | ** ** | **State of  Organization** | ** ** | **Employer  ID** | ** ** | **Organizational  ID** |
|---------------------------------|------------|---------------------------------|------------|------------------|------------|------------------------|
| **SENESCO  TECHNOLOGIES, INC.** |       | Delaware                        |       |             |       |                   |
| **SENESCO,  INC.**              |       | New Jersey                      |       |             |       |                   |

 

19

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**EXHIBIT A**

**DEFINITIONOF PLEDGED PROPERTY**

** **

For the purpose of securingprompt and complete payment and performance by the Company of all of theObligations, the Company unconditionally and irrevocably hereby grants to theSecured Party a continuing security interest in and to, and lien upon, thefollowing Pledged Property of the Company:

 

###### (a)                                 allgoods of the Company, including, without limitation, machinery, equipment,furniture, furnishings, fixtures, signs, lights, tools, parts, supplies andmotor vehicles of every kind and description, now or hereafter owned by theCompany or in which the Company may have or may hereafter acquire any interest,and all replacements, additions, accessions, substitutions and proceedsthereof, arising from the sale or disposition thereof, and where applicable,the proceeds of insurance and of any tort claims involving any of theforegoing;

######  

###### (b)                                allinventory of the Company, including, but not limited to, all goods, wares,merchandise, parts, supplies, finished products, other tangible personalproperty, including such inventory as is temporarily out of Company’s custodyor possession and including any returns upon any accounts or other proceeds,including insurance proceeds, resulting from the sale or disposition of any ofthe foregoing;

######  

###### (c)                                 allcontract rights and general intangibles of the Company, including, withoutlimitation, goodwill, trademarks, trade styles, trade names, leaseholdinterests, partnership or joint venture interests, patents and patentapplications, copyrights, deposit accounts whether now owned or hereafter created;

######  

###### (d)                                alldocuments, warehouse receipts, instruments and chattel paper of the Companywhether now owned or hereafter created;

######  

###### (e)                                 allaccounts and other receivables, instruments or other forms of obligations andrights to payment of the Company (herein collectively referred to as “Accounts”),together with the proceeds thereof, all goods represented by such Accounts andall such goods that may be returned by the Company’s customers, and allproceeds of any insurance thereon, and all guarantees, securities and lienswhich the Company may hold for the payment of any such Accounts including,without limitation, all rights of stoppage in transit, replevin andreclamation and as an unpaid vendor and/or lienor;

######  

###### (f)                                   tothe extent assignable, all of the Company’s rights under all present and futureauthorizations, permits, licenses and franchises issued or granted inconnection with the operations of any of its facilities;

######  

###### (g)                                allequity interests, securities or other instruments in other companies,including, without limitation, any subsidiaries, investments or other entities(whether or not controlled); and

 

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###### (h)                                allproducts and proceeds (including, without limitation, insurance proceeds) fromthe above-described Pledged Property.

 

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**EXHIBIT B**

** **

**FORM OF DEPOSIT ACCOUNT AGREEMENT**

 

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