Exhibit 10.26
THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS EVIDENCED HEREBY ARE SUBORDINATE
IN THE MANNER AND TO THE EXTENT SET FORTH IN THAT CERTAIN SUBORDINATION AND
INTERCREDITOR AGREEMENT (THE "SUBORDINATION AGREEMENT") DATED AS OF DECEMBER 19,
2006 AMONG VERTICALNET, INC., THE SENIOR NOTEHOLDERS PARTY THERETO (THE "SENIOR
CREDITORS") AND RADCLIFFE SPC, LTD. FOR AND ON BEHALF OF THE CLASS A CONVERTIBLE
CROSSOVER SEGREGATED PORTFOLIO; AND RADCLIFFE SPC, LTD. FOR AND ON BEHALF OF THE
CLASS A CONVERTIBLE CROSSOVER SEGREGATED PORTFOLIO, BY ITS ACCEPTANCE HEREOF,
IRREVOCABLY AGREES TO BE BOUND BY THE PROVISIONS OF THE SUBORDINATION AGREEMENT.
SECURITY AGREEMENT
THIS SECURITY AGREEMENT (as amended, restated, supplemented or otherwise
modified from time to time in accordance herewith and including all attachments,
exhibits and schedules hereto, the "Agreement"), dated as of December 19, 2006,
made by VERTICALNET, INC., a Pennsylvania corporation (the "Company") and each
of its domestic Subsidiaries now or hereafter a party hereto (individually and
collectively with the Company, "Grantor"), in favor of RADCLIFFE SPC, LTD. FOR
AND ON BEHALF OF THE CLASS A CONVERTIBLE CROSSOVER SEGREGATED PORTFOLIO (the
"Secured Party").
WHEREAS, the Company has issued a promissory note to the Secured Party (the
"Note") pursuant to a Note Purchase Agreement, dated as of May 15, 2006 (the
"Purchase Agreement"), by and among the Company and the Secured Party;
WHEREAS, Section 14(g) of the Note provides that if the Company does not obtain
the consent of the Senior Creditors to permit the Company to grant subordinated
Liens and security interests to the Secured Party in all assets of the Company
and of its Subsidiaries on or before January 31, 2007, the Secured Party may
declare the outstanding Principal of, and all accrued Interest on, and any other
amounts due under the Note immediately due and payable;
WHEREAS, the Company has obtained the consent of the Senior Creditors to the
execution and delivery of this Agreement;
WHEREAS, the Secured Party and the Company agree that each Grantor execute and
deliver to the Secured Party this Agreement providing for the grant to the
Secured Party of a continuing security interest in all personal property and
assets of each Grantor, all in substantially the form hereof to secure all
Obligations (hereinafter defined); and
WHEREAS, the Company, each Grantor and the Secured Party agree that the
execution and delivery of this Agreement fully satisfies the Company's
obligations pursuant to Section 14(g) of the Note and as a result the Secured
Party cannot declare the Note and any other amounts due under the Note due and
payable pursuant to the terms of Section 14(g) of the Note.
NOW, THEREFORE, the parties agree as follows:
ARTICLE I. Definitions
Section 1.1. Definition of Terms Used Herein. All capitalized terms used herein
and not defined herein have the respective meanings provided therefor in the
Purchase Agreement or the Note, as applicable. All terms defined in the Uniform
Commercial Code (hereinafter defined) as in effect from time to time and used
herein and not otherwise defined herein (whether