COMMON STOCK EXCEPT UPON AN EVENT OF DEFAULT, AND (IV)
NOT SUBJECT TO ANY RESTRICTION CONTAINED IN THE SENIOR NOTE.
THE TERMS AND
CONDITIONS OF ANY SUCH PLEDGE OF COMMON STOCK OF BIO-KEY SHALL BE SUBJECT TO THE
AGREEMENT OF PAYEE WHICH SHALL BE IN PAYEE'S SOLE AND EXCLUSIVE DISCRETION, AND
PAYEE SHALL BE ENTITLED CONSIDER ONLY SUCH INTERESTS AND FACTORS AS IT DESIRES
AND SHALL HAVE NO DUTY TO CONSIDER ANY INTEREST AFFECTING MAKERS.
9.
INTERCREDITOR AGREEMENT.
NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY, THE LIEN, SECURITY INTEREST AND
PLEDGE GRANTED TO THE PAYEE PURSUANT TO THIS NOTE AND THE EXERCISE OF ANY RIGHT
OR REMEDY BY THE PAYEE HEREUNDER ARE SUBJECT TO THE PROVISIONS OF THE
INTERCREDITOR AGREEMENT, DATED AS OF THE DATE HEREOF (AS AMENDED, SUPPLEMENTED
OR OTHERWISE MODIFIED FROM TIME TO TIME, THE "INTERCREDITOR AGREEMENT"), AMONG
AETHER SYSTEMS, INC., LAURUS MASTER FUND, LTD. AND BIO-KEY INTERNATIONAL, INC.
IN THE EVENT OF ANY CONFLICT BETWEEN THE TERMS OF THE INTERCREDITOR AGREEMENT
AND THIS AGREEMENT, THE TERMS OF THE INTERCREDITOR AGREEMENT SHALL GOVERN.
10
10.
REPRESENTATIONS AND WARRANTIES.
EACH MAKER
REPRESENTS AND WARRANTS TO THE PAYEE AS FOLLOWS, AND ALL OF THE REPRESENTATIONS
AND WARRANTIES HEREIN SHALL SURVIVE THE EXECUTION AND DELIVERY OF THIS NOTE.
(A)
GOOD STANDING.
EACH MAKER IS DULY
ORGANIZED, VALIDLY EXISTING, AND IN GOOD STANDING UNDER THE LAWS OF THE
JURISDICTION OF ITS ORGANIZATION, HAS FULL AND ADEQUATE POWER TO OWN ITS
PROPERTY AND CONDUCT ITS BUSINESS AS NOW CONDUCTED.
EACH MAKER IS DULY LICENSED
OR QUALIFIED AND IN GOOD STANDING IN EACH JURISDICTION IN WHICH THE NATURE OF
THE BUSINESS CONDUCTED BY IT OR THE NATURE OF THE PROPERTY OWNED OR LEASED BY IT
REQUIRES SUCH LICENSING OR QUALIFYING, EXCEPT WHERE THE FAILURE TO DO SO WOULD
NOT REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT.
(B)
POWER AND AUTHORITY.
EACH MAKER HAS ALL
REQUISITE POWER AND AUTHORITY TO MAKE THE BORROWINGS HEREUNDER, TO EXECUTE AND
DELIVER EACH DOCUMENT TO WHICH IT IS A PARTY, TO GRANT THE LIENS DESCRIBED
HEREIN AND TO CONSUMMATE THE TRANSACTIONS CONTEMPLATED THEREBY.
EACH MAKER HAS
ALL MATERIAL FRANCHISES, PERMITS, LICENSES AND ANY SIMILAR AUTHORITY NECESSARY
FOR THE CONDUCT OF ITS BUSINESS AS NOW BEING CONDUCTED BY IT, THE LACK OF WHICH
COULD, EITHER INDIVIDUALLY OR IN THE AGGREGATE, REASONABLY BE EXPECTED TO HAVE A
MATERIAL ADVERSE EFFECT.
(C)
VALIDITY.
EACH OF THE NOTE AND THE OTHER
DOCUMENTS REQUIRED TO BE EXECUTED AND DELIVERED ON OR PRIOR TO THE EFFECTIVE
DATE HAS BEEN DULY AND VALIDLY EXECUTED AND DELIVERED BY EACH MAKER AND
CONSTITUTE LEGAL, VALID AND BINDING OBLIGATIONS OF EACH MAKER ENFORCEABLE IN
ACCORDANCE WITH THE TERM THEREOF.
(D)
NONCONTRAVENTION.
THIS NOTE AND THE OTHER
DOCUMENTS EXECUTED IN CONNECTION HEREWITH DO NOT, NOR DOES THE PERFORMANCE AND
OBSERVANCE BY EACH MAKER OF ANY OF THE MATTERS AND THINGS HEREIN OR THEREIN
PROVIDED FOR, (A) CONTRAVENE OR CONSTITUTE A DEFAULT UNDER ANY PROVISION OF
MATERIAL LAW OR ANY JUDGMENT, INJUNCTION, ORDER OR DECREE BINDING UPON ANY MAKER