same in trust for the Company, and shall upon
request deliver same immediately to the Company in the form
received, with Borrower's endorsement and/or assignment when necessary, to be
held by the Company as Collateral.
If Borrower receives any stock certificate or option or deferred compensation
right, whether as an addition to, in substitution of, or in exchange for, any
Collateral, or otherwise, Borrower shall accept same in trust for the Company,
and shall upon request deliver same immediately to the Company in the form
received, with Borrower's endorsement and/or assignment when necessary, to be
held by the Company as Collateral.
Borrower is herewith delivering to the Company all certificates or instruments
representing or evidencing Collateral in suitable form for transfer or delivery,
or accompanied by duly executed instruments of transfer or assignment to be held
subject to the preceding paragraph.
SECTION 3.
LIMITATIONS ON TRANSFER.
BORROWER ACKNOWLEDGES THAT TRANSFER OF THE
SHARES IS SUBJECT TO CERTAIN LIMITATIONS UNDER THE OPTION AGREEMENT.
THE
OBLIGATION OF THE COMPANY TO RELEASE CERTIFICATES REPRESENTING SHARES TO
BORROWER OR HIS DESIGNEE HEREUNDER SHALL IN ANY EVENT BE SUBJECT TO THE
REQUIREMENTS OF THE OPTION AGREEMENT.
SUBJECT TO SUCH REQUIREMENTS AND THE
TERMS HEREOF, THE COMPANY SHALL RELEASE FROM THIS PLEDGE NON-REPURCHASABLE
SHARES OR REPURCHASABLE SHARES (AS THOSE TERMS ARE DEFINED IN THE OPTION
AGREEMENT) AS DESIGNATED BY BORROWER, PROVIDED THAT SUCH SHARES SHALL REMAIN
SUBJECT TO THE OPTION AGREEMENT TO THE EXTENT APPLICABLE.
SECTION 4.
REPRESENTATIONS AND WARRANTIES.
BORROWER REPRESENTS AND WARRANTS TO
THE COMPANY AS FOLLOWS:
(A)
BORROWER IS, AND (AS TO ANY SUBSTITUTE OR ADDITIONAL COLLATERAL)
SHALL BE, THE SOLE OWNER OF THE COLLATERAL PLEDGED BY BORROWER, FREE AND CLEAR
OF ANY LIEN, SECURITY INTEREST, OPTION OR OTHER CHARGE OR ENCUMBRANCE, EXCEPT
FOR (I) THE SECURITY INTEREST CREATED BY THIS AGREEMENT, (II) CERTAIN
RESTRICTIONS UNDER THE OPTION AGREEMENT AND (III) RESTRICTIONS IMPOSED BY
APPLICABLE LAWS, AND, SUBJECT TO THE SAME EXCEPTIONS, BORROWER HAS AND SHALL
HAVE THE RIGHT TO TRANSFER SUCH COLLATERAL AND TO GRANT A SECURITY INTEREST
THEREIN TO THE COMPANY AS PROVIDED IN THIS AGREEMENT.
(B)
NO EFFECTIVE FINANCING STATEMENT OR SIMILAR NOTICE COVERING ANY
COLLATERAL PLEDGED BY BORROWER IS OR SHALL BE ON FILE IN ANY RECORDING OFFICE,
AND NO OTHER PLEDGE OR ASSIGNMENT THEREOF HAS BEEN MADE, OR SHALL HAVE BEEN
MADE, OTHER THAN IN FAVOR OF THE COMPANY, EXCEPT AS THE COMPANY MAY APPROVE.
SECTION 5.
FURTHER ACTION BY BORROWER.
BORROWER SHALL, AT THE EXPENSE OF
BORROWER, PROMPTLY EXECUTE AND DELIVER ALL FURTHER NOTICES, INSTRUMENTS AND
DOCUMENTS, INCLUDING, WITHOUT LIMITATION, FINANCING STATEMENTS, AND TAKE ALL
SUCH FURTHER ACTION AS MAY BE REASONABLY NECESSARY OR REASONABLY ADVISABLE OR AS
THE COMPANY AT ANY TIME MAY REASONABLY REQUEST, IN ORDER TO PERFECT, PRESERVE
AND PROTECT THE SECURITY INTEREST GRANTED OR PURPORTED TO BE GRANTED HEREBY OR
TO ENABLE THE COMPANY TO EXERCISE AND ENFORCE SUCH RIGHTS, POWERS AND REMEDIES
WITH RESPECT TO THE COLLATERAL.
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SECTION 6.
PRESERVATION OF COLLATERAL.
(A)
THE COMPANY SHALL GIVE TO THE