(TOGETHER WITH ALL PROCEEDS THEREOF, INTEREST PAID
THEREON, AND SUBSTITUTIONS THEREFOR, AND WITH ALL ACCOUNTS, SECURITIES,
INSTRUMENTS, SECURITIES ENTITLEMENTS AND FINANCIAL ASSETS ARISING OUT OF ANY OF
THE FOREGOING, THE "CASH COLLATERAL") IN AN AMOUNT EQUAL TO AT LEAST 105% OF THE
OUTSTANDING BALANCE OF ALL INDEBTEDNESS (INCLUDING WITHOUT LIMITATION ANY
CONTINGENT OBLIGATIONS) OWING FROM BORROWER TO BANK.
UNRESTRICTED CASH PLEDGED
PURSUANT TO THIS SECTION 6.10 SHALL COUNT TOWARD THE CASH BALANCE REQUIRED UNDER
SECTION 6.9 (AND THE CASH REQUIRED UNDER SECTION 6.9 IS NOT IN ADDITION TO CASH
PLEDGED HEREUNDER).
6.11
INTELLECTUAL PROPERTY.
BORROWER SHALL USE COMMERCIALLY REASONABLE
EFFORTS TO (I) PROTECT, DEFEND AND MAINTAIN THE VALIDITY AND ENFORCEABILITY OF
ITS TRADEMARKS, PATENTS AND COPYRIGHTS, (II) DETECT INFRINGEMENTS OF ITS
TRADEMARKS, PATENTS AND COPYRIGHTS AND PROMPTLY ADVISE BANK IN WRITING OF
MATERIAL INFRINGEMENTS DETECTED AND (III) NOT ALLOW ANY MATERIAL TRADEMARKS,
PATENTS OR COPYRIGHTS TO BE ABANDONED, FORFEITED OR DEDICATED TO THE PUBLIC
WITHOUT THE WRITTEN CONSENT OF BANK, WHICH SHALL NOT BE UNREASONABLY WITHHELD.
6.12
FURTHER ASSURANCES.
AT ANY TIME AND FROM TIME TO TIME BORROWER
SHALL EXECUTE AND DELIVER SUCH FURTHER INSTRUMENTS AND TAKE SUCH FURTHER ACTION
AS MAY REASONABLY BE REQUESTED BY BANK TO EFFECT THE PURPOSES OF THIS AGREEMENT.
7.
NEGATIVE COVENANTS.
Borrower covenants and agrees that, so long as any credit hereunder shall be
available and until payment in full of the outstanding Obligations or for so
long as Bank may have any commitment to make any Credit Extensions, Borrower
will not do any of the following without the prior written consent of Bank which
shall not be unreasonably withheld:
7.1
DISPOSITIONS.
CONVEY, SELL, LEASE, TRANSFER OR OTHERWISE DISPOSE
OF (COLLECTIVELY, A "TRANSFER"), OR PERMIT ANY OF ITS SUBSIDIARIES TO TRANSFER,
ALL OR ANY PART OF ITS BUSINESS OR PROPERTY, INCLUDING WITHOUT LIMITATION ITS
INTELLECTUAL PROPERTY, OTHER THAN:
(I) TRANSFERS OF INVENTORY IN THE ORDINARY
COURSE OF BUSINESS; (II) TRANSFERS OF LICENSES AND SIMILAR ARRANGEMENTS FOR THE
USE OF THE PROPERTY OF BORROWER OR ITS SUBSIDIARIES IN THE ORDINARY COURSE OF
BUSINESS OR IN CONNECTION WITH JOINT VENTURES OR OTHER SIMILAR ARRANGEMENTS;
(III) TRANSFERS OF WORN-OUT OR OBSOLETE EQUIPMENT WHICH WAS NOT FINANCED BY
BANK; OR (IV) A TRANSFER OF THE DNA.COM DOMAIN NAME.
7.2
CHANGE IN BUSINESS OR EXECUTIVE OFFICE.
ENGAGE IN ANY BUSINESS,
OR PERMIT ANY OF ITS SUBSIDIARIES TO ENGAGE IN ANY BUSINESS, OTHER THAN THE
BUSINESSES CURRENTLY ENGAGED IN BY BORROWER AND ANY BUSINESS SUBSTANTIALLY
SIMILAR OR RELATED THERETO (OR INCIDENTAL THERETO); OR CEASE TO CONDUCT BUSINESS
IN THE MANNER CONDUCTED BY BORROWER AS OF THE CLOSING DATE; OR WITHOUT THIRTY
(30) DAYS PRIOR WRITTEN NOTIFICATION TO BANK, RELOCATE ITS CHIEF EXECUTIVE
OFFICE OR STATE OF INCORPORATION; OR WITHOUT BANK'S PRIOR WRITTEN CONSENT,
CHANGE THE DATE ON WHICH ITS FISCAL YEAR ENDS.
7.3
MERGERS OR ACQUISITIONS.
MERGE OR CONSOLIDATE, OR PERMIT ANY OF
ITS SUBSIDIARIES TO MERGE OR CONSOLIDATE, WITH OR INTO ANY OTHER BUSINESS
ORGANIZATION, OR ACQUIRE, OR PERMIT ANY OF ITS SUBSIDIARIES TO ACQUIRE, ALL OR
SUBSTANTIALLY