OR DESIGNEE. BANK SHALL
CREDIT ADVANCES TO THE DESIGNATED DEPOSIT ACCOUNT. BANK MAY MAKE ADVANCES UNDER
THIS AGREEMENT BASED ON INSTRUCTIONS FROM A RESPONSIBLE OFFICER OR HIS OR HER
DESIGNEE OR WITHOUT INSTRUCTIONS IF THE ADVANCES ARE NECESSARY TO MEET
OBLIGATIONS WHICH HAVE BECOME DUE.
(B)
EQUIPMENT ADVANCES. SUBJECT TO THE PRIOR
SATISFACTION OF ALL OTHER APPLICABLE CONDITIONS TO THE MAKING OF AN EQUIPMENT
ADVANCE SET FORTH IN THIS AGREEMENT, TO OBTAIN AN EQUIPMENT ADVANCE, BORROWERS
MUST NOTIFY BANK (WHICH NOTICE SHALL BE IRREVOCABLE) BY ELECTRONIC MAIL OR
FACSIMILE NO LATER THAN 12:00 P.M. PACIFIC TIME ONE (1) BUSINESS DAY BEFORE THE
PROPOSED FUNDING DATE. THE NOTICE SHALL BE A PAYMENT/ADVANCE FORM, MUST BE
SIGNED BY A RESPONSIBLE OFFICER OF EACH BORROWER OR DESIGNEE, AND (EXCEPT AS
OTHERWISE PROVIDED IN SECTION 2.1.5(A)(I) WITH RESPECT TO THE QUALIFYING INITIAL
EQUIPMENT ADVANCE) SHALL INCLUDE A COPY OF THE INVOICE FOR THE EQUIPMENT BEING
FINANCED. IF BORROWERS SATISFY THE CONDITIONS OF EACH EQUIPMENT ADVANCE, BANK
SHALL DISBURSE SUCH EQUIPMENT ADVANCE BY TRANSFER TO THE DESIGNATED DEPOSIT
ACCOUNT.
6
4
CREATION OF SECURITY INTEREST
4.1
GRANT OF SECURITY INTEREST. EACH BORROWER
HEREBY GRANTS BANK, TO SECURE THE PAYMENT AND PERFORMANCE IN FULL OF ALL OF THE
OBLIGATIONS, A CONTINUING SECURITY INTEREST IN, AND PLEDGES TO BANK, THE
COLLATERAL, WHEREVER LOCATED, WHETHER NOW OWNED OR HEREAFTER ACQUIRED OR
ARISING, AND ALL PROCEEDS AND PRODUCTS THEREOF. EACH BORROWER REPRESENTS,
WARRANTS, AND COVENANTS THAT THE SECURITY INTEREST GRANTED HEREIN IS AND SHALL
AT ALL TIMES CONTINUE TO BE A FIRST PRIORITY PERFECTED SECURITY INTEREST IN THE
COLLATERAL (SUBJECT ONLY TO PERMITTED LIENS THAT MAY HAVE SUPERIOR PRIORITY TO
BANK'S LIEN UNDER THIS AGREEMENT). IF ANY BORROWER SHALL ACQUIRE A COMMERCIAL
TORT CLAIM, BORROWERS SHALL PROMPTLY NOTIFY BANK IN A WRITING SIGNED BY
BORROWERS OF THE GENERAL DETAILS THEREOF AND GRANT TO BANK 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 BANK.
If this Agreement is terminated, Bank's Lien in the Collateral shall continue
until the Obligations (other than inchoate indemnity obligations) are repaid in
full in cash. Upon payment in full in cash of the Obligations and at such time
as Bank's obligation to make Credit Extensions has terminated, Bank shall, at
Borrowers' sole cost and expense, release its Liens in the Collateral and all
rights therein shall revert to Borrowers.
4.2
AUTHORIZATION TO FILE FINANCING STATEMENTS.
EACH BORROWER HEREBY AUTHORIZES BANK TO FILE FINANCING STATEMENTS, WITHOUT
NOTICE TO BORROWERS, WITH ALL APPROPRIATE JURISDICTIONS TO PERFECT OR PROTECT
BANK'S INTEREST OR RIGHTS HEREUNDER, INCLUDING A NOTICE THAT ANY DISPOSITION OF
THE COLLATERAL, BY EITHER BORROWERS OR ANY OTHER PERSON, SHALL BE DEEMED TO
VIOLATE THE RIGHTS OF BANK UNDER THE CODE.
5
REPRESENTATIONS AND WARRANTIES
Borrowers represent and warrant as follows as of the date of the initial Credit
Extension and thereafter:
5.1
DUE ORGANIZATION AND AUTHORIZATION. EACH
BORROWER, PARENT AND EACH OF