Document:

ex10-59.htm

Exhibit 10.59

 

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAW AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES ACT AND UNDER APPLICABLE STATE SECURITIES LAWS OR BOND LABORATORIES, INC. SHALL HAVE RECEIVED AN OPINION OF ITS COUNSEL THAT REGISTRATION OF SUCH SECURITIES UNDER THE SECURITIES ACT AND UNDER THE PROVISIONS OF APPLICABLE STATE SECURITIES LAWS IS NOT REQUIRED.

VISTAGEN THERAPEUTICS, INC.

Secured Convertible Promissory Note

	
Principal Sum (U.S.): $300,000 

No.: N-PLTG-1 

	
Issuance Date: July 2, 2012 

Maturity Date: July 2, 2015

FOR VALUE RECEIVED, the undersigned, VistaGen Therapeutics, Inc., a Nevada corporation (the "Company"), hereby promises to pay to the order of Platinum Long Term Growth VII, LLC, a Delaware limited liability company, or any future permitted holder of this Promissory Note (the “Holder”), at the principal office of the Holder set forth herein, or at such other place as the holder may designate in writing to the Company, the principal sum of Three Hundred Thousand Dollars ($300,000) or such other amount as may be outstanding hereunder, together with all accrued but unpaid interest, shall be paid as provided in this Promissory Note (the "Note").

1. Ranking. This Note shall rank senior to all other indebtedness and equity securities of the Company.  The Company may not redeem, declare or pay any dividends (whether in cash, stock or any combination thereof), or otherwise make any distributions with respect to any class or series of capital stock of the Company, or prepay any outstanding indebtedness, while this Note is outstanding without the written consent from Holder(s) representing at least two-thirds (2/3rds) of the then-outstanding aggregate principal amount of the Note.  The Company shall not incur any indebtedness except Permitted Indebtedness.  “Permitted Indebtedness” means: (a) indebtedness owed to Holder; (b) purchase money indebtedness in an amount not to exceed $500,000 and which is secured only by the assets financed by such purchase money lenders; and (c) indebtedness that is subordinated to the Company’s obligations to the Holder, bears a legend evidencing such subordination, by its terms, does not permit any payments to be made before all obligations of the Company to the Holder shall have been paid and satisfied in full, is not secured by any assets that do not secure the Company’s obligations hereunder, and is evidenced by an agreement in writing among the Holder, the Company, and the person or entity to whom such subordinated indebtedness is owed, which written agreement shall be in form and substance satisfactory to the Holder.

 

2. Maturity/Principal and Interest Payments.   The outstanding principal balance of this Note together with all accrued but unpaid interest hereunder (the “Outstanding Balance”) shall be due and payable on July 2, 2015 (the “Maturity Date”.  The Note shall accrue interest equal to ten percent (10%) per annum and shall compound monthly.  Interest on the outstanding principal balance of the Note shall be computed on the basis of the actual number of days elapsed and a year of three hundred and sixty-five (365) days and shall be payable in cash.  Prepayment of the principal and accrued interest under this Note shall be permitted at any time and from time to time, without penalty.  Upon the occurrence of an Event of Default (as defined below) hereunder, interest on this Note shall accrue at a rate of eighteen percent (18%) per annum (the “Default Rate”); provided, however that if such rate exceeds the maximum allowed by law, the Default Rate shall be the maximum rate allowed by law.

  

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3. Non-Business Days.  Whenever any payment to be made shall be due on a Saturday, Sunday or a public holiday under the laws of the State of New York, such payment may be due on the next succeeding business day and such next succeeding day shall be included in the calculation of the amount of accrued interest payable on such date.

 

4. A. Mandatory Conversion.  Upon the closing by the Company of an equity, equity based or debt financing or a series of financings following the date of this Note resulting in gross proceeds to the Company totaling at least $3,000,000, exclusive of any additional investment by the Holder of this Note (a “Qualified Financing”), the outstanding principal amount of this Note together with all accrued and unpaid interest hereunder (the “Outstanding Balance”) shall automatically convert into such securities, including warrants of the Company as are issued in the Qualified Financing, if any (“QF Securities”), at the lowest price per share, unit, or other component of QF Securities, as applicable, paid by any investor in any round of the Qualified Financing; provided, however, that if more than one type or form of securities is issued in any round of the Qualified Financing, and such type or form of securities are not offered in a unit, then the Holder shall have the right to elect the type or form of securities that the Holder shall receive upon conversion of this Note. Upon such conversion, the Holder shall be deemed to be a Holder in the Qualified Financing and shall be granted all rights afforded to an investor in the Qualified Financing, and this Note shall be considered terminated and of no further force and effect. The Holder(s) shall have no other right to convert the Outstanding Balance into securities of the Company, other than as expressly set forth above in this Section 4A.

 

B.  Notwithstanding anything to the contrary set forth in this Note, at no time may all or a portion of this Note be converted if the number of QF Securities to be issued pursuant to such conversion, when aggregated with all other shares of common stock in the Company owned by the Holder at such time, would result in the Holder beneficially owning (as determined in accordance with Section 13(d) of the Securities Exchange Act of 1934 and the rules thereunder) in excess of 9.99% of the then issued and outstanding shares of common stock of the Company outstanding at such time; provided, however, that upon the Holder providing the Company with sixty-one (61) days’ advance notice (the “9.99% Waiver Notice”) that the Holder would like to waive this Section 4.B. with regard to any or all QF Securities issuable upon conversion of this Note, this Section 4.B. will be of no force or effect with regard to all or a portion of the Note referenced in the 9.99% Waiver Notice.

 

5. Security Interest.  The Company’s obligations under this Note are secured by all assets of the Company pursuant to that certain Security Agreement, dated as of the date hereof, by the Company in favor of the Holder(s) of the Note (the “Security Agreement”).

 

6. Events of Default.  The occurrence of any of the following events shall be an "Event of Default" under this Note:

 

(a) the Company shall fail to make the payment of any amount of any principal outstanding for a period of ten (10) business days after the date such payment shall become due and payable hereunder; or

 

(b) the Company shall fail to make the payment of any amount of any interest for a period of ten (10) business days after the date such interest shall become due and payable hereunder; or

 

(c) the Company shall default in the payment of any indebtedness equal to or in excess of $500,000 (the "Indebtedness") (other than the Indebtedness hereunder) at its stated maturity or payment date, whether such Indebtedness now exists or shall hereinafter be created, and such default is evidenced by a notice of default delivered to the Company by the holder of such Indebtedness, and such Indebtedness has not been discharged in full or such payment has not been stayed, rescinded, annulled or cured within thirty (30) days following the delivery of such notice of default; or

 

  

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(d) A judgment or order for the payment of money shall be rendered against the Company or any of its subsidiaries in excess of $500,000 in the aggregate (net of any applicable insurance coverage) for all such judgments or orders against all such persons (treating any deductibles, self insurance or retention as not so covered) that shall not be discharged, and all such judgments and orders remain outstanding, and there shall be any period of sixty (60) consecutive days following entry of the judgment or order in excess of $500,000 or the judgment or order which causes the aggregate amount described above to exceed $500,000 during which a stay of enforcement of such judgment or order, by reason of a pending appeal or otherwise, shall not be in effect; or

 

(e) the Company shall (i) apply for or consent to the appointment of, or the taking of possession by, a receiver, custodian, trustee or liquidator of itself or of all or a substantial part of its property or assets, (ii) make a general assignment for the benefit of its creditors, (iii) commence a voluntary case under the Bankruptcy Code or under the comparable laws of any jurisdiction (foreign or domestic), (iv) file a petition seeking to take advantage of any bankruptcy, insolvency, moratorium, reorganization or other similar law affecting the enforcement of creditors' rights generally, (v) acquiesce in writing to any petition filed against it in an involuntary case under the Bankruptcy Code or under the comparable laws of any jurisdiction (foreign or domestic), or (vi) take any action under the laws of any jurisdiction (foreign or domestic) analogous to any of the foregoing; or

 

(f) a proceeding or case shall be commenced in respect of the Company or any of its subsidiaries without its application or consent, in any court of competent jurisdiction, seeking (i) the liquidation, reorganization, moratorium, dissolution, winding up, or composition or readjustment of its debts, (ii) the appointment of a trustee, receiver, custodian, liquidator or the like of it or of all or any substantial part of its assets or (iii) similar relief in respect of it under any law providing for the relief of debtors, and such proceeding or case described in clause (i), (ii) or (iii) shall continue undismissed, or unstayed and in effect, for a period of thirty (30) consecutive days or any order for relief shall be entered in an involuntary case under the Bankruptcy Code or under the comparable laws of any jurisdiction (foreign or domestic) against the Company or any of its subsidiaries or action under the laws of any jurisdiction (foreign or domestic) analogous to any of the foregoing shall be taken with respect to the Company or any of its subsidiaries and shall continue undismissed, or unstayed and in effect for a period of thirty (30) consecutive days.

 

(g) an Event of Default shall have occurred under any other promissory note issued by the Company to the Holder and/or under the Security Agreement.

 

7. Remedies Upon An Event of Default.  If an Event of Default shall have occurred and shall be continuing, the Holder of this Note may at any time at its option, (a) declare the entire unpaid principal balance of this Note, together with all interest accrued hereon, due and payable, and thereupon, the same shall be accelerated and so due and payable; provided, however, that upon the occurrence of an Event of Default described in (i) Sections 6(e) and (f), without presentment, demand, protest, or notice, all of which are hereby expressly unconditionally and irrevocably waived by the Company, the outstanding principal balance and accrued interest hereunder shall be automatically due and payable, and (ii) Sections 6(a) through (d), the Holder may exercise or otherwise enforce any one or more of the Holder's rights, powers, privileges, remedies and interests under this Note or applicable law.  No course of delay on the part of the Holder shall operate as a waiver thereof or otherwise prejudice the right of the Holder.  No remedy conferred hereby shall be exclusive of any other remedy referred to herein or now or hereafter available at law, in equity, by statute or otherwise.

 

8. Replacement.  Upon receipt by the Company of (i) evidence of the loss, theft, destruction or mutilation of any Note and (ii) (y) in the case of loss, theft or destruction, of indemnity (without any bond or other security) reasonably satisfactory to the Company, or (z) in the case of mutilation, the Note (surrendered for cancellation), the Company shall execute and deliver a new Note of like tenor and date.  However, the Company shall not be obligated to reissue such lost, stolen, destroyed or mutilated Note if the Holder contemporaneously requests the Company to convert such Note.

 

  

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9. Parties in Interest, Transferability.  This Note shall be binding upon the Company and its successors and assigns and the terms hereof shall inure to the benefit of the Holder and its successors and permitted assigns. This Note may only be transferred or sold subject to the provisions of Section 17 of this Note, or pledged, hypothecated or otherwise granted as security by the Holder, provided that the Holder receives the express written consent of the Company, which consent shall not be unreasonably withheld,

 

10. Amendments.  This Note may not be modified or amended in any manner except in writing executed by the Company and the Holder.

 

11. Notices.  Any notice, demand, request, waiver or other communication required or permitted to be given hereunder shall be in writing and shall be effective (a) upon hand delivery by telecopy or facsimile at the address or number designated below (if delivered on a business day during normal business hours where such notice is to be received), or the first business day following such delivery (if delivered other than on a business day during normal business hours where such notice is to be received) or (b) on the second business day following the date of mailing by express courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever shall first occur.  The Company will give written notice to the Holder at least thirty (30) days prior to the date on which the Company closes its books or takes a record (x) with respect to any dividend or distribution upon the common stock of the Company, (y) with respect to any pro rata subscription offer to holders of common stock of the Company or (z) for determining rights to vote with respect to a major transaction for which shareholder approval is required under California law, dissolution, liquidation or winding-up and in no event shall such notice be provided to such holder prior to such information being made known to the public.  The Company will also give written notice to the Holder at least twenty (20) days prior to the date on which dissolution, liquidation or winding-up will take place and in no event shall such notice be provided to the Holder prior to such information being made known to the public.

 

	
  

	
Address of the Holder: 

 

Platinum Long Term Growth VII, LLC

152 West 57th Street, 4th Floor

New York, NY 10019

Attention: Michael Goldberg, M.D.

Tel. No.: (212) 271-7895

Fax No.: (212) 582-2424

 

with a copy to: 

 

Burak Anderson & Melloni, PLC

30 Main Street, Suite 210

Burlington, Vermont 05401

Attention: Shane W. McCormack, Esquire

Tel No.: (802) 862-0500

Fax No.: (802) 862-8176

	 
	
 

	
 

 

  

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             Address of the Company:                                 

 

VistaGen Therapeutics, Inc.

384 Oyster Point Blvd., Suite No. 8

South San Francisco, California 94080

Attention: Chief Executive Officer

Tel. No.: (650) 244-9990 ext. 224

Fax No.: (888) 482-2602

            

             with a copy to:

 

Disclosure Law Group

501 West Broadway, Suite 800

San Diego, California 92101

Attention: Daniel W. Rumsey, Esquire

Tel No.: (619) 795-1134

Fax No.: (619) 330-2101

12. Governing Law. This Note shall be governed by and construed in accordance with the internal laws of the State of New York, without giving effect to the choice of law provisions.  This Note shall not be interpreted or construed with any presumption against the party causing this Note to be drafted.

 

13. Headings.  Article and section headings in this Note are included herein for purposes of convenience of reference only and shall not constitute a part of this Note for any other purpose.

 

14. Remedies, Characterizations, Other Obligations, Breaches and Injunctive Relief.  The remedies provided in this Note shall be cumulative and in addition to all other remedies available under this Note, at law or in equity (including, without limitation, a decree of specific performance and/or other injunctive relief), no remedy contained herein shall be deemed a waiver of compliance with the provisions giving rise to such remedy and nothing herein shall limit a Holder's right to pursue actual damages for any failure by the Company to comply with the terms of this Note.  Amounts set forth or provided for herein with respect to payments and the like (and the computation thereof) shall be the amounts to be received by the Holder and shall not, except as expressly provided herein, be subject to any other obligation of the Company (or the performance thereof).  The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable and material harm to the Holder and that the remedy at law for any such breach may be inadequate.  Therefore the Company agrees that, in the event of any such breach or threatened breach, the Holder shall be entitled, in addition to all other available rights and remedies, at law or in equity, to seek and obtain such equitable relief, including but not limited to an injunction restraining any such breach or threatened breach, without the necessity of showing economic loss and without any bond or other security being required.

 

15. Failure or Indulgence Not Waiver.  No failure or delay on the part of the Holder in the exercise of any power, right or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude other or further exercise thereof or of any other right, power or privilege.

 

16. Enforcement Expenses.  The Company agrees to pay all costs and expenses of Holder’s enforcement of Holder’s rights under this Note, including, without limitation, reasonable attorneys' fees and expenses.

 

  

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17. Binding Effect.   The obligations of the Company and the Holder set forth herein shall be binding upon the successors and assigns of each such party, whether or not such successors or assigns are permitted by the terms hereof.

 

18. Compliance with Securities Laws.  The Holder of this Note acknowledges that this Note is being acquired solely for the Holder's own account and not as a nominee for any other party, and for investment, and that the Holder shall not offer, sell or otherwise dispose of this Note other than in compliance with the laws of the United States of America and as guided by the rules of the Securities and Exchange Commission.  This Note and any Note issued in substitution or replacement therefore shall be stamped or imprinted with a legend in substantially the following form:

 

"THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAW AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES ACT AND UNDER APPLICABLE STATE SECURITIES LAWS OR BOND LABORATORIES, INC. SHALL HAVE RECEIVED AN OPINION OF ITS COUNSEL THAT REGISTRATION OF SUCH SECURITIES UNDER THE SECURITIES ACT AND UNDER THE PROVISIONS OF APPLICABLE STATE SECURITIES LAWS IS NOT REQUIRED."

 

19. Severability.  The provisions of this Note are severable, and if any provision shall be held invalid or unenforceable in whole or in part in any jurisdiction, then such invalidity or unenforceability shall not in any manner affect such provision in any other jurisdiction or any other provision of this Note in any jurisdiction.

 

20. Consent to Jurisdiction.  Each of the Company and the Holder (i) hereby irrevocably submits to the jurisdiction of the United States District Court sitting in the Southern District of New York and the courts of the State of New York for the purposes of any suit, action or proceeding arising out of or relating to this Note and (ii) hereby waives, and agrees not to assert in any such suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of such court, that the suit, action or proceeding is brought in an inconvenient forum or that the venue of the suit, action or proceeding is improper.  Each of the Company and the Holder consents to process being served in any such suit, action or proceeding by mailing a copy thereof to such party at the address set forth in Section 11 hereof and agrees that such service shall constitute good and sufficient service of process and notice thereof.  Nothing in this Section 20 shall affect or limit any right to serve process in any other manner permitted by law.

 

21. Company Waivers.  Except as otherwise specifically provided herein, the Company and all others that may become liable for all or any part of the obligations evidenced by this Note, hereby waive presentment, demand, notice of nonpayment, protest and all other demands and notices in connection with the delivery, acceptance, performance and enforcement of this Note, and do hereby consent to any number of renewals of extensions of the time or payment hereof and agree that any such renewals or extensions may be made without notice to any such persons and without affecting their liability herein and do further consent to the release of any person liable hereon, all without affecting the liability of the other persons, firms or Company liable for the payment of this Note, AND DO HEREBY WAIVE TRIAL BY JURY.

 

(a) No delay or omission on the part of the Holder in exercising its rights under this Note, or course of conduct relating hereto, shall operate as a waiver of such rights or any other right of the Holder, nor shall any waiver by the Holder of any such right or rights on any one occasion be deemed a waiver of the same right or rights on any future occasion.

 

  

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(b) THE COMPANY ACKNOWLEDGES THAT THE TRANSACTION OF WHICH THIS NOTE IS A PART IS A COMMERCIAL TRANSACTION, AND TO THE EXTENT ALLOWED BY APPLICABLE LAW, HEREBY WAIVES ITS RIGHT TO NOTICE AND HEARING WITH RESPECT TO ANY PREJUDGMENT REMEDY WHICH THE HOLDER OR ITS SUCCESSORS OR ASSIGNS MAY DESIRE TO USE.

 

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IN WITNESS WHEREOF, the Company has executed and delivered this Note as of the date first written above.

VISTAGEN THERAPEUTICS, INC.

By: /s/ Jerrold D. Dotson

    Name:  Jerrold D. Dotson

Title:  Chief Financial Officerex10-60.htm

Exhibit 10.60

 

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 July 2, 2012, is made by VistaGen Therapeutics, Inc., a Nevada corporation (the “Grantor”), in favor of Platinum Long Term Growth VII, LLC, a Delaware limited liability company (together with its successors and assigns, the “Secured Party”).

 

WHEREAS, the Grantor has issued a secured convertible promissory note to the Secured Party in the aggregate principal amount of $300,000, and intends to issue an additional secured convertible promissory note to the Secured Party in the aggregate principal amount of $200,000 (each as amended, restated, supplemented or otherwise modified, the “Note”, and collectively, the “Notes”); and

 

WHEREAS, it is a condition precedent to the Secured Party making the loans evidenced by the Notes to the Grantor that the Grantor execute and deliver to the Secured Party a security agreement providing for the grant to the Secured Party of a continuing security interest in all personal property and assets of the Grantor, in substantially the form hereof, to secure all amounts due under the terms of the Notes.

 

NOW, THEREFORE, the parties agree as follows:

 

ARTICLE I.                                       Definitions

 

Section 1.1. Definition of Terms Used Herein.  All capitalized terms used herein shall have the meanings set forth below in Section 1.2.  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 or not such terms are capitalized) have the same definitions herein as specified therein.

 

Section 1.2. Definition of Certain Terms Used Herein.  As used herein, the following terms have the following meanings:

 

"Collateral" means all of the Grantor’s now owned or hereafter acquired right, title and interest in and to the Grantor’s personal property, whether now owned or hereafter acquired, and wherever located, including, without limitation, the following: (a) Accounts; (b) equipment; (c) fixtures; (d) general intangibles; (e) inventory; (f)  deposit accounts; (g) cash; (h) goods; and other tangible and intangible personal property of Grantor whether now or hereafter owned or existing, leased, consigned by or to, or acquired by, Grantor and wherever located; (i) Licenses; (j) Patent Licenses; (k) Patents; (l) Trademark Licenses; (m) Trademarks; (n) Securities; (o) Financial Assets; (p) letter of credit rights; (q) Contract Rights; and (r) all products, proceeds, additions, replacements and substitutions of and to all of the Foregoing.

 

“Contract Rights” means all of Grantor’s rights in, to and under all documents and instruments, whether now existing or hereafter arising, including, without limitation, all rights to payments, claims, rights, powers, privileges and remedies, including, without limitation, rights to make elections and determinations.

 

“Default” means any event or circumstance which, with the giving of notice, the lapse of time, or both, would (if not cured, waived, or otherwise remedied during such time) constitute an Event of Default.

 

  

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“Event of Default” means (a) any Event of Default specified in the Notes; (b) any failure of Grantor to comply with its obligations hereunder; (c) any failure of the Secured Party’s lien on the Collateral constituting a valid, perfected security interest at all times; and (d) any failure of any representation or warranty of Grantor made herein to be true, correct and complete in all repects.

 

“Indemnitees” has the meaning specified in Section 7.5(b).

 

 “Licenses” means any Patent License, Trademark License or other license of rights or interests.

 

“Lien” means: (i) any interest in property securing an obligation owed to, or a claim by, a person other than the owner of the property, whether such interest is based on the common law, statute, or contract, and including a security interest, charge, claim, or lien arising from a mortgage, deed of trust, encumbrance, pledge, hypothecation, assignment, deposit arrangement, agreement, security agreement, conditional sale or trust receipt or a lease, consignment or bailment for security purposes; (ii) to the extent not included under clause (i), any reservation, exception, encroachment, easement, right-of-way, covenant, condition, restriction, lease or other title exception or encumbrance affecting property; and (iii) any contingent or other agreement to provide any of the foregoing.

 

"Notes" has the meaning assigned to such term in the first recital of this Agreement.

 

“Obligations” means (a) all amounts due and owing under the terms of the Notes including without limitation Secured Party’s costs and expenses of enforcement of Secured Party’s rights under the Notes, and (b) costs and expenses incurred by Secured Party in connection with (i) enforcement of Secured Party’s rights hereunder, (ii) preservation, protection and maintenance of Collateral, and (iii) discharging liens other than Permitted Liens.

 

“Patent License” means any written agreement granting any right with respect to any invention on which a Patent is in existence or a Patent application is pending, in which agreement Grantor now holds or hereafter acquires any interest.

 

“Patents” means all letters patent of, or rights corresponding thereto, in the United States or in any other country, all registrations and recordings thereof, and all applications for letters patent of, or rights corresponding thereto, in the United States or any other country.

 

"Permitted Liens" shall mean (a) liens subordinate to the Secured Party’s liens pursuant to a subordination agreement in form and substance satisfactory to Secured Party, and (b) purchase money security interests in an amount not to exceed $500,000 secured only by the assets financed by such purchase money security interest holders.

 

 “Registered Organization” means an entity formed by filing a registration document with a United States Governmental Authority, such as a corporation, limited partnership or limited liability company.

 

"Security Interest" has the meaning specified in Section 2.1 of this Agreement.

 

“Trademark License” means any written agreement granting any right to use any Trademark or Trademark registration, now owned or hereafter acquired by Grantor or in which Grantor now holds or hereafter acquires any interest.

 

“Trademarks” means all trademarks (registered, common law or otherwise) and any applications in connection therewith, including registrations, recordings and applications in the United States Patent and Trademark Office or in any similar office or agency of the United States, any State thereof or any other country or any political subdivision thereof.

 

  

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 “Uniform Commercial Code” means the Uniform Commercial Code from time to time in effect in the State of New York.

 

ARTICLE II.                                       Security Interest

 

2.1           Security Interest.  As security for the payment and performance, in full of the Obligations, and any extensions, renewals, modifications or refinancings of the Obligations, the Grantor hereby bargains, sells, conveys, assigns, sets over, mortgages, pledges, hypothecates and transfers to the Secured Party, and hereby grants to the Secured Party, and Secured Party’s successors and assigns, a security interest in, all of such Grantor's right, title and interest in, to and under the Collateral (the "Security Interest").

 

Section 2.1. No Assumption of Liability.  The Security Interest is granted as security only and shall not subject the Secured Party to, or in any way alter or modify, any obligation or liability of the Grantor with respect to or arising out of the Collateral.

 

ARTICLE III.                                       Representations and Warranties

 

The Grantor represents and warrants to the Secured Party that:

 

Section 3.1. Title and Authority.  The Grantor has good and valid rights in and title to the Collateral with respect to which it has purported to grant a security interest hereunder and has full power and authority to grant to the Secured Party the Security Interest and to execute, deliver and perform its obligations in accordance with the terms of this Agreement, without the consent or approval of any other person other than any consent or approval which has been obtained.

 

Section 3.2. Filings; Actions to Achieve Perfection.  Fully executed Uniform Commercial Code financing statements (including fixture filings, as applicable) or other appropriate filings, recordings or registrations containing a description of the Collateral have been delivered to the Secured Party for filing in each United States governmental, municipal or other office specified in Schedule A, which are all the filings, recordings and registrations that are necessary to publish notice of and protect the validity of and to establish a legal, valid and perfected security interest in favor of the Secured Party in respect of all Collateral in which the Security Interest may be perfected by filing, recording or registration in the United States (or any political subdivision thereof) and its territories and possessions, and no further or subsequent filing, refiling, recording, rerecording, registration or reregistration is necessary in any such jurisdiction, except as provided under applicable law with respect to the filing of continuation statements or with respect to the filing of amendments or new filings to reflect the change of the Grantor's name, location, identity or corporate structure.  The Grantor’s name is listed in the preamble of this Agreement identically to how it appears on its certificate of incorporation or other organizational documents and Grantor has not changed its name or jurisdiction of incorporation during the last year.  Schedule 3.2 hereto contains a true, correct and complete list of all Patents, Patent Applications, Patent Licenses, Trademarks, Trademark Applications, and Trademark Licenses of Grantor.

 

Section 3.3. Validity and Priority of Security Interest.  The Security Interest constitutes a legal and valid first-priority security interest in all the Collateral securing the payment and performance of the Obligations.

 

  

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Section 3.4. Absence of Other Liens.  The Collateral is owned by the Grantor free and clear of any any and all Liens.  Without limiting the foregoing, the Grantor has not filed or consented to any filing described in Section 3.2 in favor of any person other than the Secured Party, nor permitted the granting or assignment of a security interest or permitted perfection of any security interest in the Collateral in favor of any person or entity other than the Secured Party.  The Secured Party’s having possession of all instruments and cash constituting Collateral from time to time and the filing of financing statements in the offices referred to in Schedule A hereto results in the perfection of such security interest.  Such security interest is, or in the case of Collateral in which the Grantor obtain rights after the date hereof, will be, a perfected security interest.  Such notices, filings and all other action necessary or desirable to perfect and protect such security interest have been duly taken.

 

Section 3.5. Valid and Binding Obligation.  This Agreement constitutes the legal, valid and binding obligation of the Grantor, enforceable against the Grantor in accordance with its terms, except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, and other laws of general application affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies, and (iii) to the extent the indemnification provisions contained in this Agreement may be limited by applicable federal or state securities laws.

 

ARTICLE IV.                                       Covenants

 

Section 4.1. Change of Name; Location of Collateral; Place of Business, State of Formation or Organization.

 

(a) The Grantor shall notify the Secured Party in writing promptly of any change (i) in its corporate name or in any trade name used to identify it in the conduct of its business or in the ownership of its properties, (ii) in the location of its chief executive office, its principal place of business, any office in which it maintains books or records relating to Collateral owned by it (including the establishment of any such new office or facility), (iii) in its identity or corporate structure such that a filed filing made under the Uniform Commercial Code becomes misleading or (iv) in its Federal Taxpayer Identification Number.  In extension of the foregoing, the Grantor shall not effect or permit any change referred to in the preceding sentence unless all filings have been made under the Uniform Commercial Code or otherwise that are required in order for the Secured Party to continue at all times following such change to have a valid, legal and perfected security interest in all the Collateral.

 

(b) Without limiting Section 4.1(a), without the prior written consent of the Secured Party in each instance, the Grantor shall not change its (i) place of business, if it has only one place of business and is not a Registered Organization, (ii) principal place of business, if it has more than one place of business and is not a Registered Organization, or (iii) state of incorporation, formation or organization, if it is a Registered Organization.

 

Section 4.2. Records.  The Grantor shall maintain, at its own cost and expense, such complete and accurate records with respect to the Collateral owned by it as is consistent with its current practices and in accordance with such prudent and standard practices used in industries that are the same as or similar to those in which the Grantor is engaged, but in any event to include complete accounting records indicating all payments and proceeds received with respect to any part of the Collateral, and, at such time or times as any of the Secured Party may reasonably request, promptly to prepare and deliver to such Secured Party a duly certified schedule or schedules in form and detail satisfactory to such Secured Party showing the identity, amount and location of any and all Collateral.

 

  

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Section 4.3. Periodic Certification; Notice of Changes.  In the event there should at any time be any change in the information represented and warranted herein or in the documents and instruments executed and delivered in connection herewith, the Grantor shall immediately notify the Secured Party in writing of such change (this notice requirement shall be in extension of and shall not limit or relieve the Grantor of any other covenants hereunder).

 

Section 4.4. Protection of Security.  The Grantor shall, at its own cost and expense, (a) take any and all actions necessary to defend title to the Collateral against all persons and entities and to defend the Security Interest of the Secured Party in the Collateral and the priority thereof against any Lien other than Permitted Liens, and (b) keep the Collateral insured against loss, theft and damage pursuant to insurance policies that name the Secured Party as loss Payee and additional insured and which shall not be cancelled without 30 days’ prior notice to Secured Party.  Notwithstanding any such cancellation of any insurance policy, Grantor shall cause the Collateral to be continuously insured at all times.

 

Section 4.5. Inspection and Verification.  The Secured Party and such persons as the Secured Party may reasonably designate shall have the right to inspect the Collateral, all records related thereto (and to make extracts and copies from such records) and the premises upon which any of the Collateral is located, to discuss the Grantor's affairs with the officers of the Grantor and its independent accountants and to verify under reasonable procedures the validity, amount, quality, quantity, value, condition and status of, or any other matter relating to, the Collateral, including, in the case of collateral in the possession of any third Person and upon an Event of Default, by contacting any account debtor or third Person possessing such Collateral for the purpose of making such a verification.  Out-of-pocket expenses in connection with any inspections by representatives of the Secured Party shall be (a) the obligations of the Grantor with respect to any inspection after the Secured Party’ demand payment of the Notes or (b) the obligation of the Secured Party in any other case.

 

Section 4.6. Taxes; Encumbrances.  At its option, the Secured Party may discharge Liens, other than Permitted Liens, at any time levied or placed on the Collateral and may pay for the maintenance and preservation of the Collateral to the extent the Grantor fails to do so and the Grantor shall reimburse the Secured Party on demand for any payment made or any expense incurred by the Secured Party pursuant to the foregoing authorization; provided, however, that nothing in this Section shall be interpreted as excusing the Grantor from the performance of, or imposing any obligation on the Secured Party to cure or perform, any covenants or other obligation of the Grantor with respect to any Lien or maintenance or preservation of Collateral as set forth herein.

 

Section 4.7. Use and Disposition of Collateral.  The Grantor shall not make or permit to be made an assignment, pledge or hypothecation of any Collateral or grant any other Lien in respect of the Collateral other than Permitted Liens without the prior written consent of the Secured Party.  The Grantor shall not make or permit to be made any transfer or sale of any Collateral to any person or entity other than Secured Party and the Grantor shall remain at all times in possession of the Collateral owned by it, other than with respect Permitted Liens.

 

ARTICLE V.                                       Further Assurances

 

Section 5.1. Further Assurances.  Grantor shall, at its own expense, execute, acknowledge, deliver and cause to be duly filed all such further instruments and documents and take all such actions as the Secured Party may from time to time reasonably request to better assure, preserve, protect, perfect and continue the perfection of the Security Interest, to ensure that Secured Party has “control” (as defined in the Uniform Commercial Code) over the Collateral, and to assure, preserve and protect Secured Party’s rights and remedies created hereby, including the payment of any fees and taxes required in connection with the execution and delivery of this Agreement, the granting of the Security Interest and the filing of any financing statements (including fixture filings) or other documents in connection herewith or therewith, including without limitation the recordation of the Security Interest with the United States Patent and Trademark Office.  If any amount payable under or in connection with any of the Collateral shall be or become evidenced by any promissory note or other instrument, such note or instrument shall be immediately pledged and delivered to the Secured Party, duly endorsed in a manner satisfactory to the Secured Party.

 

  

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ARTICLE VI.                                       Remedies

 

Section 6.1. Remedies upon Default.

 

(a) Upon the occurrence and during the continuance of an Event of Default, Grantor agrees to deliver each item of its Collateral to the Secured Party on demand, and it is agreed that the Secured Party shall have the right to take any of or all the following actions at the same or different times: with or without legal process and with or without prior notice or demand for performance, to take possession of the Collateral and without liability for trespass to enter any premises where the Collateral may be located for the purpose of taking possession of or removing the Collateral, exercise Grantor's right to bill and receive payment for completed work and, generally, to exercise any and all rights afforded to a secured party under the Uniform Commercial Code or other applicable law.  Without limiting the generality of the foregoing, Grantor agrees that the Secured Party shall have the right, subject to the mandatory requirements of applicable law, to sell or otherwise dispose of all or any part of the Collateral, at public or private sale or at any broker's board or on any securities exchange, for cash, upon credit or for future delivery as the Secured Party shall deem appropriate.  The Secured Party shall be authorized at any such sale (if it deems it advisable to do so) to restrict the prospective bidders or purchasers to persons who will represent and agree that they are purchasing the Collateral for their own account for investment and not with a view to the distribution or sale thereof, and upon consum­mation of any such sale the Secured Party shall have the right to assign, transfer and deliver to the purchaser or purchasers thereof the Collateral so sold.  Each such purchaser at any such sale shall hold the property sold absolutely, free from any claim or right on the part of Grantor, and Grantor hereby waives (to the extent permitted by law) all rights of redemption, stay and appraisal which Grantor now has or may at any time in the future have under any rule of law or statute now existing or hereafter enacted.

 

(b) The Secured Party shall give Grantor ten (10) days' written notice (which Grantor agrees is reasonable notice within the meaning of Section 9-612  of the Uniform Commercial Code) of the Secured Party’s intention to make any sale of Collateral.  Such notice, in the case of a public sale, shall state the time and place for such sale and, in the case of a sale at a broker's board or on a securities exchange, shall state the board or exchange at which such sale is to be made and the day on which the Collateral, or portion thereof, will first be offered for sale at such board or exchange.  Any such public sale shall be held at such time or times within ordinary business hours and at such place or places as the Secured Party may fix and state in the notice (if any) of such sale.  At any such sale, the Collateral, or portion thereof, to be sold may be sold in one lot as an entirety or in separate parcels, as the Secured Party may (in its sole and absolute discretion) determine.  The Secured Party shall not be obligated to make any sale of any Collateral if it shall determine not to do so, regardless of the fact that notice of sale of such Collateral shall have been given.  The Secured Party may, without notice or publication, adjourn any public or private sale or cause the same to be adjourned from time to time by announcement at the time and place fixed for sale, and such sale may, without further notice, be made at the time and place to which the same was so adjourned.  In case any sale of all or any part of the Collateral is made on credit or for future delivery, the Collateral so sold may be retained by the Secured Party until the sale price is paid by the purchaser or purchasers thereof, but the Secured Party shall not incur any liability in case any such purchaser or purchasers shall fail to take up and pay for the Collateral so sold and, in case of any such failure, such Collateral may be sold again upon like notice.  At any public (or, to the extent permitted by law, private) sale made pursuant to this Section, the Secured Party may bid for or purchase, free (to the extent permitted by law) from any right of redemption, stay, valuation or appraisal on the part of Grantor (all said rights being also hereby waived and released to the extent permitted by law), the Collateral or any part thereof offered for sale and may make payment on account thereof by using any claim then due and payable to the Secured Party from Grantor as a credit against the purchase price, and the Secured Party may, upon compliance with the terms of sale, hold, retain and dispose of such property without further accountability to Grantor therefor.  For purposes hereof, a written agreement to purchase the Collateral or any portion thereof shall be treated as a sale thereof; the Secured Party shall be free to carry out such sale pursuant to such agreement and Grantor shall not be entitled to the return of the Collateral or any portion thereof subject thereto, notwithstanding the fact that after the Secured Party shall have entered into such an agreement all

 

  

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Obligations have been paid in full.  As an alternative to exercising the power of sale herein conferred upon it, the Secured Party may proceed by a suit or suits at law or in equity to foreclose this Agreement and to sell the Collateral or any portion thereof pursuant to a judgment or decree of a court or courts having competent jurisdiction or pursuant to a proceeding by a court-appointed receiver.

 

Section 6.2. Application of Proceeds.  The Secured Party shall apply the proceeds of any collection or sale of the Collateral, as well as any Collateral consisting of cash, as follows:

 

(a) FIRST, to the payment of all costs and expenses incurred by the Secured Party in connection with such collection or sale or otherwise in connection with this Agreement or any of the Obligations, including all court costs and the fees and expenses of its agents and legal counsel, and any other costs or expenses incurred in connection with the exercise of any right or remedy hereunder, under the Exchange Agreement dated as of June 29, 2012, between the Grantor and the Secured Party (the “Exchange Agreement”) and the Notes;

 

(b) SECOND, to the payment in full of the Obligations; and

 

(c) THIRD, to Grantor, its successors or assigns, or to whomsoever may be lawfully entitled to receive the same, or as a court of competent jurisdiction may otherwise direct.

 

Subject to the foregoing, the Secured Party shall have absolute discretion as to the time of application of such proceeds, moneys or balances in accordance with this Agreement.  Upon any sale of the Collateral by the Secured Party (including pursuant to a power of sale granted by statute or under a judicial proceeding), the receipt of any such proceeds, moneys or balances by the Secured Party or of the officer making the sale shall be a sufficient discharge to the purchaser or purchasers of the Collateral so sold and such purchaser or purchasers shall not be obligated to see to the application of any part of the purchase money paid over to the Secured Party or such officer or be answerable in any way for the misapplication thereof.

 

ARTICLE VII.                                       Miscellaneous

 

Section 7.1. Notices.  All communications and notices hereunder to the Grantor and to the Secured Party shall (except as otherwise expressly permitted herein) be in writing and delivered to the Grantor or the Secured Party, as the case may be, as provided in the Notes.

 

Section 7.2. Security Interest Absolute.  All rights of the Secured Party hereunder, the Security Interest and all obligations of Grantor hereunder shall be absolute and unconditional irrespective of (a) any lack of validity or enforceability of the Notes, or any agreement with respect to any of the Obligations or any other agreement or instrument relating to any of the foregoing, (b) any change in the time, manner or place of payment of, or in any other term of, all or any of the Obligations, or any other amendment or waiver of or any consent to any departure from the Notes, or any other agreement or instrument, (c) any exchange, release or non-perfection of any Lien on other collateral, or any release or amendment or waiver of or consent under or departure from any guarantee, securing or guaranteeing all or any of the Obligations, or (d) any other circumstance that might otherwise constitute a defense available to, or a discharge of, Grantor in respect of the Obligations or this Agreement.

 

  

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Section 7.3. Survival of Agreement.  All covenants, agreements, representations and warranties made by Grantor herein and in the certificates or other instruments prepared or delivered in connection with or pursuant to this Agreement shall be considered to have been relied upon by the Secured Party and shall survive the making of the loans and the execution and delivery to the Secured Party of the Notes, regardless of any investigation made by the Secured Party or on their behalf; and shall continue in full force and effect until this Agreement shall terminate.

 

Section 7.4. Binding Effect; Several Agreement; Successors and Assigns.  This Agreement shall become effective as to Grantor when a counterpart hereof executed on behalf of Grantor shall have been delivered to the Secured Party and a counterpart hereof shall have been executed on behalf of the Secured Party, and thereafter shall be binding upon Grantor and the Secured Party and their respective successors and assigns, and shall inure to the benefit of Grantor, the Secured Party and their respective successors and assigns, except that Grantor shall not have the right to assign or transfer its rights or obligations hereunder or any interest herein or in the Collateral (and any such assignment or transfer shall be void) except as expressly contemplated by this Agreement and the Notes.

 

Section 7.5. Secured Party’ Fees and Expense; Indemnification.

 

(a) Grantor agrees to pay upon demand to the Secured Party the amount of any and all reasonable expenses, including all reasonable fees, disbursements and other charges of its counsel and of any experts or agents, which the Secured Party may incur in connection with (i) the administration of this Agreement (including the customary fees and charges of the Secured Party for any audits conducted by them or on their behalf with respect to the accounts inventory), (ii) the custody or preservation of, or the sale of, collection from or other realization upon any of the Collateral, (iii) the exercise, enforcement or protection of any of the rights of the Secured Party hereunder or (iv) the failure of Grantor to perform or observe any of the provisions hereof.

 

(b) Grantor agrees to indemnify the Secured Party and the agent, contractors and employees of the Secured Party (collectively, the “Indemnitees”) against, and hold each of them harmless from, any and all losses, claims, damages, liabilities and related expenses, including reasonable fees, disbursements and other charges of counsel, incurred by or asserted against any of them arising out of, in any way connected with, or as a result of, the execution, delivery, or performance of this Agreement or any agreement or instrument contemplated hereby or any claim, litigation, investigation or proceeding relating hereto or to the Collateral, whether or not any Indemnitee is a party thereto; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses are determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted from the gross negligence or willful misconduct of such Indemnitee.

 

(c) Any such amounts payable as provided hereunder shall be additional Obligations secured hereby.  The provisions of this Section shall remain operative and in full force and effect regardless of the termination of this Agreement and the Notes, the consummation of the transactions contemplated hereby, the repayment of any of the Obligations, the invalidity or unenforceability of any term or provision of this Agreement or the Notes, or any investigation made by or on behalf of the Secured Party.  All amounts due under this Section shall be payable on written demand therefor.

 

Section 7.6. GOVERNING LAW.  THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.

 

  

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Section 7.7. Waivers; Amendment.

 

(a) No failure or delay of the Secured Party in exercising any power or right hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power.  The rights and remedies of the Secured Party hereunder are cumulative and are not exclusive of any rights or remedies that they would otherwise have.  No waiver of any provisions of this Agreement, or the Notes or consent to any departure by Grantor therefrom shall in any event be effective unless the same shall be permitted by paragraph (b) below, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given.  No notice to or demand on Grantor in any case shall entitle Grantor to any other or further notice or demand in similar or other circumstances.

 

(b) Neither this Agreement nor any provision hereof may be waived, amended or modified except pursuant to an agreement or agreements, in writing entered into by the Secured Party and Grantor.

 

Section 7.8. WAIVER OF JURY TRIAL.  EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR THE NOTES.  EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE NOTES, AS APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

 

Section 7.9. Severability.  In the event any one or more of the provisions contained in this Agreement should be held invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein shall not in any way be affected or impaired thereby (it being understood that the invalidity of a particular provision in a particular jurisdiction shall not in and of itself affect the validity of such provision in any other jurisdiction).  The parties shall endeavor in good-faith negotiations to replace the invalid, illegal or unenforceable provisions with valid provisions the economic effect of which comes as close as possible to that of the invalid, illegal or unenforceable provisions.

 

Section 7.10. Counterparts.  This Agreement may be executed in two or more counterparts, each of which shall constitute an original but all of which when taken together shall constitute but one contract.  Each party shall be entitled to rely on a facsimile signature of any other party hereunder as if it were an original.

  

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Section 7.11. Jurisdiction; Consent to Service of Process.

 

(a) Grantor hereby irrevocably and unconditionally submits, for itself and its property, to the nonexclusive jurisdiction of any New York State court or Federal court of the United States of America sitting in New York, and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Agreement or the Notes, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such New York State or, to the extent permitted by law, in such Federal court.  Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.  Nothing in this Agreement shall affect any right that the Secured Party may otherwise have to bring any action or proceeding relating to this Agreement or the Notes against Grantor or its properties in the courts of any jurisdiction.

 

(b) Grantor hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement, the Exchange Agreement, or the Notes in any New York State or Federal court.  Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.

 

(c) Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in Section 7.1.  Nothing in this Agreement will affect the right of any party to this Agreement to process in any other manner permitted by law.

 

Section 7.12. Termination.  This Agreement and the Security Interest shall terminate when all the Obligations have been paid and satisfied in full, at which time the Secured Party shall execute and deliver to Grantor, at Grantor’s expense, all Uniform Commercial Code termination statements and similar documents which Grantor shall reasonably request to evidence such termination.  Any execution and delivery of termination statements or documents pursuant to this Section shall be without recourse to or warranty by the Secured Party.

 

Section 7.13. Prejudgment Remedy Waiver.  Grantor acknowledges that this Agreement, the Exchange Agreement and the Notes evidence a commercial transaction and that it could, under certain circumstances have the right, to notice of and hearing on the right of the Secured Party to obtain a prejudgment remedy, such as attachment, garnishment and/or replevin, upon commencing any litigation against Grantor.  Notwithstanding, Grantor hereby waives all rights to notice, judicial hearing or prior court order to which it might otherwise have the right under any state or federal statute or constitution in connection with the obtaining by the Secured Party of any prejudgment remedy by reason of this Agreement, the Notes or by reason of the Obligations or any renewals or extensions of the same.  Grantor also waives any and all objection, which it might otherwise assert, now or in the future, to the exercise or use by the Secured Party of any right of setoff, repossession or self help as may presently exist under statute or common law.

 

[Signature page follows]

 

  

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IN WITNESS WHEREOF, the parties have duly executed this Security Agreement as of the day and year first written above.

 

VISTAGEN THERAPEUTICS, INC.

 

By:/s/ Jerrold D. Dotson

      Name: Jerrold D. Dotson

      Title: Chief Financial Officer

PLATINUM LONG TERM GROWTH VII, LLC

 

By: /s/ Joseph Finestone

      Name:  Joseph Finestone

      Title:  Associate

 

  

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SCHEDULE A

 

Places of Business; Chief Executive Office; Filing Locations

 

State of Incorporation:

Nevada

Chief Executive Office:

California

 

Filing Locations:

Secretary of State of the State of Nevada

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