RIGHTS OR ELECTRONIC
CHATTEL PAPER OWNED BY COMPANY, WITH ANY AGREEMENTS ESTABLISHING CONTROL TO BE
IN FORM AND SUBSTANCE SATISFACTORY TO LAURUS, (II) THE PROMPT (BUT IN NO EVENT
LATER THAN FIVE (5) BUSINESS DAYS FOLLOWING LAURUS' REQUEST THEREFOR) DELIVERY
TO LAURUS OF ALL ORIGINAL INSTRUMENTS, CHATTEL PAPER, NEGOTIABLE DOCUMENTS AND
CERTIFICATED STOCK OWNED BY THE COMPANY (IN EACH CASE, ACCOMPANIED BY STOCK
POWERS, ALLONGES OR OTHER INSTRUMENTS OF TRANSFER EXECUTED IN BLANK), (III)
NOTIFICATION OF LAURUS' INTEREST IN COLLATERAL AT LAURUS' REQUEST, AND (IV) THE
INSTITUTION OF LITIGATION AGAINST THIRD PARTIES AS SHALL BE PRUDENT IN ORDER TO
PROTECT AND PRESERVE COMPANY'S AND LAURUS' RESPECTIVE AND SEVERAL INTERESTS IN
THE COLLATERAL.
COMPANY SHALL PROMPTLY, AND IN ANY EVENT WITHIN FIVE (5)
BUSINESS DAYS AFTER
THE SAME IS ACQUIRED BY IT, NOTIFY LAURUS OF ANY COMMERCIAL TORT CLAIM (AS
DEFINED IN THE UCC) ACQUIRED BY IT AND UNLESS OTHERWISE CONSENTED BY LAURUS,
COMPANY SHALL ENTER INTO A SUPPLEMENT TO THIS AGREEMENT GRANTING TO LAURUS A
LIEN IN SUCH COMMERCIAL TORT CLAIM.
COMPANY SHALL PLACE NOTATIONS UPON ITS BOOKS AND RECORDS AND ANY FINANCIAL
STATEMENT OF COMPANY TO DISCLOSE LAURUS' LIEN IN THE COLLATERAL.
IF COMPANY RETAINS POSSESSION OF ANY CHATTEL PAPER OR INSTRUMENT WITH LAURUS'
CONSENT, UPON LAURUS' REQUEST SUCH CHATTEL PAPER AND INSTRUMENTS SHALL BE MARKED
WITH THE FOLLOWING LEGEND:
"THIS WRITING AND OBLIGATIONS EVIDENCED OR SECURED
HEREBY ARE SUBJECT TO THE SECURITY INTEREST OF LAURUS MASTER FUND, LTD."
COMPANY SHALL PERFORM IN A REASONABLE TIME ALL OTHER STEPS REQUESTED BY LAURUS
TO CREATE AND MAINTAIN IN LAURUS' FAVOR A VALID PERFECTED FIRST LIEN IN ALL
COLLATERAL SUBJECT ONLY TO PERMITTED LIENS.
COMPANY SHALL NOTIFY LAURUS PROMPTLY AND IN ANY EVENT WITHIN THREE (3)
BUSINESS
DAYS AFTER OBTAINING KNOWLEDGE THEREOF (I) OF ANY EVENT OR CIRCUMSTANCE THAT TO
COMPANY'S KNOWLEDGE WOULD CAUSE LAURUS TO CONSIDER ANY THEN EXISTING ACCOUNT AS
NO LONGER CONSTITUTING AN ELIGIBLE ACCOUNT; (II) OF ANY MATERIAL DELAY IN
COMPANY'S PERFORMANCE OF ANY OF ITS OBLIGATIONS TO ANY ACCOUNT DEBTOR; (III) OF
ANY ASSERTION BY ANY ACCOUNT DEBTOR OF ANY MATERIAL CLAIMS, OFFSETS OR
COUNTERCLAIMS; (IV) OF ANY ALLOWANCES, CREDITS AND/OR MONIES GRANTED BY COMPANY
TO ANY ACCOUNT DEBTOR; (V) OF ALL MATERIAL ADVERSE INFORMATION
10Z-6
RELATING TO THE FINANCIAL CONDITION OF AN ACCOUNT DEBTOR; (VI) OF ANY MATERIAL
RETURN OF GOODS; AND (VII) OF ANY LOSS, DAMAGE OR DESTRUCTION OF ANY OF THE
COLLATERAL.
ALL ELIGIBLE ACCOUNTS (I) WHICH ARE BILLED ON A CONSTRUCTION COMPLETION BASIS
BUT NOT PAYABLE UNTIL THE PROJECT IS COMPLETED, REPRESENT COMPLETE BONA FIDE
TRANSACTIONS WHICH REQUIRE NO FURTHER ACT UNDER ANY CIRCUMSTANCES ON COMPANY'S
PART TO MAKE SUCH ACCOUNTS PAYABLE BY THE ACCOUNT DEBTORS, (II) ARE NOT SUBJECT
TO ANY PRESENT, FUTURE CONTINGENT OFFSETS OR COUNTERCLAIMS, AND (III) DO NOT
REPRESENT BILL AND HOLD SALES, CONSIGNMENT SALES, GUARANTEED SALES, SALE OR
RETURN OR OTHER SIMILAR UNDERSTANDINGS OR OBLIGATIONS OF ANY AFFILIATE OR
SUBSIDIARY OF COMPANY.
COMPANY HAS NOT MADE, AND WILL NOT MAKE ANY AGREEMENT
WITH ANY ACCOUNT DEBTOR