BANKRUPTCY, INSOLVENCY, REORGANIZATION,
MORATORIUM OR SIMILAR LAWS AFFECTING THE ENFORCEMENT OF CREDITOR'S RIGHTS
GENERALLY.
(B)
THIS AGREEMENT CREATES IN FAVOR OF THE SECURED PARTY A VALID
SECURITY INTEREST IN THE COLLATERAL SECURING THE PAYMENT AND PERFORMANCE OF THE
OBLIGATIONS AND, UPON MAKING THE FILINGS DESCRIBED IN THE IMMEDIATELY FOLLOWING
SENTENCE, A SECURITY INTEREST IN SUCH COLLATERAL, SUBJECT TO A SENIOR SECURITY
INTEREST HELD BY WESTERN COMMERCIAL BANK.
EXCEPT FOR THE FILING OF FINANCING
STATEMENTS ON FORM UCC-1 UNDER THE UCC WITH THE JURISDICTIONS INDICATED ON
SCHEDULE I, ATTACHED HERETO, NO AUTHORIZATION OR APPROVAL OF OR FILING WITH OR
NOTICE TO ANY GOVERNMENTAL AUTHORITY OR REGULATORY BODY IS REQUIRED EITHER:
(I) FOR THE GRANT BY THE DEBTOR, OR THE EFFECTIVENESS OF, THE SECURITY INTEREST
GRANTED HEREBY OR FOR THE EXECUTION, DELIVERY AND PERFORMANCE OF THIS AGREEMENT
BY THE DEBTOR; OR (II) FOR THE PERFECTION OF OR EXERCISE BY THE SECURED PARTY OF
ITS RIGHTS AND REMEDIES HEREUNDER.
(C)
THE COMPANY IS THE SOLE OWNER OF THE COLLATERAL (EXCEPT FOR
NON-EXCLUSIVE LICENSES GRANTED BY THE COMPANY IN THE ORDINARY COURSE OF
BUSINESS), FREE AND CLEAR OF ANY LIENS, SECURITY INTERESTS, ENCUMBRANCES, RIGHTS
OR CLAIMS, AND IS FULLY AUTHORIZED TO GRANT THE SECURITY INTEREST IN AND TO
PLEDGE THE COLLATERAL.
THERE IS NOT ON FILE IN ANY GOVERNMENTAL OR REGULATORY
AUTHORITY, AGENCY OR RECORDING OFFICE AN EFFECTIVE FINANCING STATEMENT, SECURITY
AGREEMENT, LICENSE OR TRANSFER OR ANY NOTICE OF ANY OF THE FOREGOING (OTHER THAN
THOSE THAT HAVE BEEN FILED IN FAVOR OF THE SECURED PARTY PURSUANT TO THIS
AGREEMENT) COVERING OR AFFECTING ANY OF THE COLLATERAL.
SO LONG AS THIS
AGREEMENT SHALL BE IN EFFECT, THE COMPANY SHALL NOT EXECUTE AND SHALL NOT
KNOWINGLY PERMIT TO BE ON FILE IN ANY SUCH OFFICE OR AGENCY ANY SUCH FINANCING
STATEMENT OR OTHER DOCUMENT OR INSTRUMENT (EXCEPT TO THE EXTENT FILED OR
RECORDED IN FAVOR OF THE SECURED PARTY PURSUANT TO THE TERMS OF THIS AGREEMENT).
(D)
NO PART OF THE COLLATERAL HAS BEEN JUDGED INVALID OR
UNENFORCEABLE.
NO WRITTEN CLAIM HAS BEEN RECEIVED THAT ANY COLLATERAL OR THE
COMPANY'S USE OF ANY COLLATERAL VIOLATES THE RIGHTS OF ANY THIRD PARTY. THERE
HAS BEEN NO ADVERSE DECISION TO THE COMPANY'S CLAIM OF OWNERSHIP RIGHTS IN OR
EXCLUSIVE RIGHTS TO USE THE COLLATERAL IN ANY JURISDICTION OR TO THE COMPANY'S
RIGHT TO KEEP AND MAINTAIN SUCH COLLATERAL IN FULL FORCE AND EFFECT, AND THERE
IS NO PROCEEDING INVOLVING SAID RIGHTS PENDING OR, TO THE BEST KNOWLEDGE OF THE
COMPANY, THREATENED BEFORE ANY COURT, JUDICIAL BODY, ADMINISTRATIVE OR
REGULATORY AGENCY, ARBITRATOR OR OTHER GOVERNMENTAL AUTHORITY.
(E)
THIS AGREEMENT CREATES IN FAVOR OF THE SECURED PARTY A VALID
SECURITY INTEREST IN THE COLLATERAL SECURING THE PAYMENT AND PERFORMANCE OF THE
OBLIGATIONS.
3
(F)
ON THE DATE OF EXECUTION OF THIS AGREEMENT, THE COMPANY WILL
DELIVER TO THE SECURED PARTY ONE OR MORE EXECUTED UCC FINANCING STATEMENTS ON
FORM-1 WITH RESPECT TO THE SECURITY INTEREST, PURSUANT TO THE JURISDICTIONS
ATTACHED HERETO.
(G)
THE EXECUTION, DELIVERY AND PERFORMANCE OF