SUBSIDIARIES IN THE ORDINARY COURSE OF
BUSINESS (AS HISTORICALLY CONDUCTED), (II) THE DISPOSITION OF THE ASSETS USED IN
THE ELECTRO-OPTICS BUSINESS OF OPTELECOM, (III) THE LICENSING OF PATENTS,
TRADEMARKS, COPYRIGHTS AND/OR OTHER INTELLECTUAL PROPERTY IN THE ORDINARY COURSE
OF BUSINESS (AS HISTORICALLY CONDUCTED) AND UPON CUSTOMARY TERMS,
(IV) DISPOSITIONS OF INVENTORY AND OBSOLETE AND SURPLUS PROPERTY IN THE ORDINARY
COURSE OF BUSINESS (AS HISTORICALLY CONDUCTED), (V) THE PAYMENT BY OPTELECOM OR
ANY SUBSIDIARY THEREOF, RESPECTIVELY, OF ANY PAYABLES INCURRED BY SUCH ENTITY IN
THE ORDINARY COURSE OF BUSINESS (AS HISTORICALLY CONDUCTED), AND (VI) IF, UPON
CONSUMMATION OF SUCH DISPOSITION, THE PROCEEDS ARE USED TO SATISFY IN FULL, IN
CASH, ALL OF THE OUTSTANDING OBLIGATIONS UNDER THIS NOTE.
(E)
NO LIENS. NEITHER OPTELECOM NOR ANY OF ITS
SUBSIDIARIES SHALL CREATE OR SUFFER TO EXIST ANY LIEN, SECURITY INTEREST,
ENCUMBRANCE, PLEDGE, HYPOTHECATION OR ASSIGNMENT OF ANY OF ITS PROPERTIES OR
ASSETS, OR ANY INTEREST THEREIN, OTHER THAN:
(I)
THE HOLDER'S SECURITY INTEREST;
(II)
LIENS AND SECURITY INTERESTS ON PROPERTY AND
ASSETS OF OPTELECOM SECURING THE SENIOR INDEBTEDNESS, PROVIDED THAT SUCH
PROPERTIES AND ASSETS ARE ALSO SUBJECT TO A PERFECTED SECURITY INTEREST AND LIEN
IN FAVOR OF THE HOLDER SECURING THE OBLIGATIONS OF OPTELECOM UNDER THIS NOTE
(SUBJECT IN PRIORITY AS PROVIDED IN SECTION 7 HEREOF AND THE INTERCREDITOR
AGREEMENT);
(III)
LIENS AND SECURITY INTERESTS ON PROPERTY AND
ASSETS OF OPTELECOM-NKF B.V. SECURING THE INDEBTEDNESS PERMITTED UNDER
SECTION 8.2(A)(II); AND
(IV)
(A) LIENS FOR TAXES WHICH ARE NOT DELINQUENT OR
WHICH ARE BEING DILIGENTLY CONTESTED IN GOOD FAITH AND BY APPROPRIATE
PROCEEDINGS AND ADEQUATE RESERVES WITH RESPECT THERETO ARE MAINTAINED ON THE
BOOKS OF OPTELECOM; (B) DEPOSITS OR PLEDGES TO SECURE OBLIGATIONS UNDER WORKERS'
COMPENSATION, SOCIAL SECURITY OR SIMILAR LAWS, OR UNDER UNEMPLOYMENT INSURANCE
IN THE ORDINARY COURSE OF BUSINESS; (C) JUDGMENT LIENS TO THE EXTENT THE ENTRY
OF SUCH JUDGMENT DOES NOT CONSTITUTE AN EVENT OF DEFAULT UNDER THE TERMS OF THIS
NOTE OR RESULT IN THE SALE OR LEVY OF, OR EXECUTION ON, ANY OF THE COLLATERAL
UNDER THE HOLDER'S SECURITY INTEREST OR THE SHARE CAPITAL OF ONH PLEDGED UNDER
THE PLEDGE AGREEMENT; (D) STATUTORY LIENS OF LANDLORDS, CARRIERS, WAREHOUSEMEN,
MECHANICS, MATERIALMEN AND OTHER SIMILAR LIENS IMPOSED BY LAW, WHICH ARE
INCURRED IN THE ORDINARY COURSE OF BUSINESS FOR SUMS NOT MORE THAN THIRTY (30)
DAYS DELINQUENT OR WHICH ARE BEING CONTESTED IN GOOD FAITH; (E) LIENS AGAINST
CASH DEPOSITS TO SECURE THE PERFORMANCE OF TENDERS, STATUTORY OBLIGATIONS,
SURETY, CUSTOMS BONDS, BIDS, GOVERNMENT CONTRACTS, PERFORMANCE BONDS AND OTHER
SIMILAR OBLIGATIONS (EXCLUSIVE OF OBLIGATIONS FOR THE PAYMENT OF BORROWED
MONEY); (F) DEPOSITS MADE IN THE ORDINARY COURSE OF BUSINESS TO SECURE LIABILITY
TO INSURANCE CARRIERS; (G) A PURCHASE MONEY SECURITY INTEREST, ATTACHING AT THE
TIME OF ACQUISITION, IN EQUIPMENT ACQUIRED AFTER THE DATE OF THIS NOTE
(PROVIDED, HOWEVER, THAT (X) THE INDEBTEDNESS SECURED BY ANY SUCH SECURITY
INTEREST SHALL NOT EXCEED 100% OF THE COST OF THE EQUIPMENT COVERED PLUS FINANCE
CHARGES, FEES, COSTS AND EXPENSES (INCLUDING ATTORNEYS FEES) OF DOCUMENTATION,
PERFECTION,