Document:

Prepared by MerrillDirect

 

	
	FINANCIAL ASSETS
  SECURITY AGREEMENT
	Standard	 

FINANCIAL
ASSETS SECURITY AGREEMENT
("Security Agreement") dated as of May 1, 2001, given by STOCKERYALE,
INC. F/K/A STOCKER & YALE, INC., a corporation organized and
existing under the laws of the State of Massachusetts ("Customer") to
MERRILL
LYNCH BUSINESS FINANCIAL SERVICES INC. ("MLBFS").

1. Definitions. (a) In addition to terms
defined elsewhere in this Security Agreement, when used herein the following
terms shall have the following meanings:

(i)
         "Bankruptcy Event" shall mean any of
the following: (A) a proceeding under any bankruptcy, reorganization,
arrangement, insolvency, readjustment of debt or receivership law or statute
shall be filed or consented to by Customer; or (B) any such proceeding shall be
filed against Customer and shall not be dismissed or withdrawn within sixty
(60) days after filing; or (C) Customer shall make a general assignment for the
benefit of creditors; or (D) Customer shall become insolvent or generally fail
to pay or admit in writing its inability to pay its debts as they become due;
or (E) Customer shall be adjudicated a bankrupt or insolvent.

(ii)
        "Business Day" shall mean any day
other than a Saturday, Sunday, federal holiday or other day on which the New
York Stock Exchange is regularly closed.

(iii)
       "Collateral" shall mean: (A) the
Securities Account, (B) any free credit balances now or hereafter credited to
or owing from MLPF&S to Customer in respect of the Securities Account, (C)
all financial assets and investment property (including, without limitation,
all security entitlements, securities accounts, stocks, bonds, mutual funds,
certificates of deposit, commodities contracts and other securities), money
market deposit accounts, instruments, general intangibles and other property of
whatever kind or description now and hereafter in or controlled by the
Securities Account or listed on any confirmation or periodic report from
MLPF&S as being in or controlled by the Securities Account, whether now
owned or hereafter acquired, (D) all proceeds of the sale, exchange, redemption
or exercise of any of the foregoing, including, without limitation, all
dividends, interest payments and other distributions of cash or property in
respect thereof, and (E) all rights incident to the ownership of any of the
foregoing.

(iv)
      "Loan Agreements" shall mean that
certain WCMA
LOAN AND SECURITY AGREEMENT NO. 794-07E49 between Customer and MLBFS,
and that certain WCMA REDUCING REVOLVER LOAN AND SECURITY AGREEMENT NO.
794-07E50 between Customer and MLBFS, as either or both of the same
may from time to time be or have been amended, restated, extended or
supplemented.

(v)
       "Minimum Value” shall mean $2,000,000.00.

(vi)
      "MLPF&S" shall mean MERRILL
LYNCH, PIERCE, FENNER & SMITH INCORPORATED, and its successors
and assigns.

(vii)
     "Obligations" shall mean all
obligations, liabilities and indebtedness of every kind and nature now or
hereafter owing, arising, due or payable from Customer to MLBFS, howsoever
created, arising, or evidenced, whether direct or indirect, absolute or
contingent, or due or to become due, including, without limitation, interest
accruing after the filing of any petition in bankruptcy, and all present and
future obligations, liabilities and indebtedness of Customer to MLBFS under the
Loan Agreements and the agreements, instruments and documents executed pursuant
thereto, including, without limitation, this Security Agreement.

(viii)
    "Permitted Liens" shall mean: (A)
liens in favor of MLBFS; (B) liens for current taxes not delinquent and, if
MLBFS' rights to and interest in the Collateral are not materially and
adversely affected thereby, liens for taxes being contested in good faith by
appropriate proceedings; (C) any trade settlement liens of MLPF&S; and (D)
other liens permitted in writing by MLBFS.

(ix)
       "Securities Account" shall mean that
certain MLPF&S securities account number 794-07E67 in the name of Customer
and any and all successor securities accounts at MLPF&S.

(b) All terms used in this Security Agreement
which are defined in the Uniform Commercial Code of Illinois ("UCC")
shall have the meanings set forth in the UCC. Without limiting the foregoing,
the term "financial assets" and "security entitlement"
shall have the meaning set forth in Section 8-102 of the UCC, and the term
"investment property" shall have the meaning set forth in Section
9-115 of the UCC.

2. Grant of Security Interest. In order to
secure payment and performance of the Obligations, Customer hereby pledges,
grants and conveys and assigns to MLBFS a continuing first lien and security
interest upon the Collateral subject only to any Permitted Liens. In
furtherance thereof, Customer hereby irrevocably: (i) authorizes and directs
MLPF&S to name or rename the Securities Account on its books and records as
the "STOCKERYALE,
INC. F/K/A STOCKER & YALE, INC. PLEDGED COLLATERAL ACCOUNT F/B/O MLBFS",
(ii) authorizes and directs MLPF&S and every other person or entity now or
hereafter holding or otherwise having possession or control of any Collateral
to hold, possess or control such Collateral as agent for MLBFS and subject to
the rights, direction, control and security interest of MLBFS, (iii) authorizes
and directs MLPF&S and all such other persons or entities to comply with
any and all present and future entitlement orders or directions of MLBFS with
respect to the Securities Account and all or any part of the Collateral,
notwithstanding any contrary direction or dispute by Customer or any other
party (unless prohibited by law or the order of a judicial body having
appropriate jurisdiction), and without making any inquiry whatsoever as to
MLBFS' right or authority to give such order or direction or as to the
application of any payment pursuant thereto, (iv) waives and releases
MLPF&S and all such other persons and entities from, and agrees to
indemnify and hold harmless MLPF&S and all such other persons and entities
from and against, any liability whatsoever for complying with any such orders
or directions of MLBFS; and (v) agrees with MLBFS and MLPF&S that all assets
and other property now and from time to time hereafter in or controlled by the
Securities Account or listed on any confirmation of periodic report from
MLPF&S as being in or controlled by the Securities Account shall be deemed
to be "Financial Assets" within the meaning of the UCC.

3. Rights and Limitations of Customer. (a)
Except upon the prior written consent of MLBFS, Customer shall not: (i)
purchase any financial assets, investment property or other property with funds
in the Securities Account other than: (A) publicly held domestic money market
funds or deposits with Merrill Lynch Bank USA or Merrill Lynch Bank & Trust
Co. which are credited to the Securities Account, (B) obligations of or
guaranteed or insured by the U. S. Government (including insured certificates
of deposit), or (C) if the overall investment quality of the Collateral is not
thereby materially reduced and if the Securities Account is not thereby
materially less diversified, publically traded stocks, bonds and other
financial assets or investment property which are margin-eligible and otherwise
acceptable to MLBFS and purchased with the proceeds of other Collateral which
has been sold by Customer; (ii) borrow any funds on margin or otherwise from
anyone other than MLBFS using all or any part of the Collateral as collateral;
(iii) otherwise grant or permit to exist any lien or security interest upon any
part of the Collateral other than Permitted Liens, or (iv) directly or
indirectly withdraw any financial assets, investment property or other property
from the Securities Account except in connection with a sale permitted hereby.

(b) So long as no Event of Default shall have
occurred and be continuing, Customer may without the consent of MLBFS: (i)
retain any financial assets, investment property and other property which are
in or controlled by the Securities Account on the date hereof; (ii) sell any
such property at any time so long as the proceeds are either held in the
Securities Account or used to purchase other financial assets or investment
property permitted hereby which are held in or controlled by the Securities
Account; and (iii) exercise any voting and consensual rights with respect to
the financial assets, investment property and other property included in the
Collateral for any purpose not inconsistent with this Security Agreement.

4. Warranties. Customer warrants to MLBFS on a
continuing basis that:

(a) Ownership and Priority. Except for the
rights of MLBFS hereunder and for any Permitted Liens: (i) Customer is the
owner of the Securities Account and all other Collateral free and clear of any
interest or lien of any third party, and (ii) upon the acknowledgment of this
Security Agreement by MLPF&S and/or the completion of any other action
required by applicable law to perfect its security interest hereunder, MLBFS
will have a valid and perfected first lien and security interest upon all of
the Collateral.

(b) Collateral Not Restricted; Enforceability.
Except as enforceability may be limited by bankruptcy and other similar laws
affecting the rights of creditors generally or by general principles of equity:
(i) neither Customer nor any part of the Collateral is subject to any legal,
contractual or other restriction which might hinder or prevent the grant to or
enforcement by MLBFS of the security interest in the Collateral pursuant to
this Security Agreement, and (ii) this Security Agreement is the legal, valid
and binding obligation of Customer, enforceable against Customer in accordance
with its terms.

(c) Right, Power and Authority. Customer has
the full right, power and authority to make, execute and deliver this Security
Agreement.

5. Covenants.

(a) No Other Liens. Except upon the prior
written consent of MLBFS, Customer will not cause or permit to exist any
security interests or liens upon the Collateral other than Permitted Liens.

(b) Maintenance of Perfection. Customer will
execute and deliver to MLBFS such Uniform Commercial Code financing statements,
continuation statements and other agreements, instruments and documents as
MLBFS may from time reasonably require in order to establish, perfect and
maintain perfected the lien and security interest of MLBFS hereunder.

(c) Change in Principal Place of Business.
Customer will provide not less than 30 days prior written notice of any change
in Customer's principal place of business.

(d) Change With MLPF&S. Customer will
provide MLBFS with prompt written notice of any change known to Customer in the
account number of the Securities Account, the Financial Consultant at
MLPF&S assigned to Customer or the address of said Financial Consultant's
office at MLPF&S.

(e) Minimum Collateral Value. Customer further
warrants and agrees that the aggregate immediate market value of the Collateral
will at all times during the term hereof be not less than the Minimum Value. In
determining the value of the Collateral for the purposes of this Section, no
value will be given to any financial assets or investment property in or
controlled through the Securities Account for less than 30 calendar days where
such financial assets or investment property either: (i) have been issued by an
open-end investment company (including money market funds and other open-end
mutual funds) other than in connection with reinvestment of dividends; or (ii)
are part of a new issue with respect to which MLPF&S participated as a
member of the selling group or syndicate.

6. Event of Default. The occurrence of any of
the following will constitute an "Event of Default" hereunder: (a)
the occurrence of an Event of Default under the terms of any of the Loan
Agreements; or (b) if Customer shall breach or violate any of its covenants or
warranties herein contained, and does not cure such breach or violation within
10 Business Days after notice from MLBFS; or (c) a default or Event of Default
by Customer shall occur under the terms of any other agreement, instrument or
document with or intended for the benefit of MLBFS, MLPF&S or any of their
affiliates, and any required notice shall
have been given and required passage of time shall have elapsed; or (d)
if Customer's subscription to the Securities Account shall be terminated for
any reason; or (e) any event shall occur which shall reasonably cause MLBFS to
in good faith believe that the prospect of payment or performance by Customer
has been materially impaired (determined in a manner consistent with the intent
of Section 1-208 of the UCC); or (f) if at any time the aggregate immediate
market value of the Collateral shall be or become an amount less than the
Minimum Value (determined in a manner consistent with Section 5(e) hereof), and
Customer shall not within 1 Business Day of written demand by MLBFS deposit
into the Securities Account additional financial assets or investment property
acceptable to MLBFS sufficient to increase such aggregate immediate market
value to at least the Minimum Value; or (g) any Bankruptcy Event shall occur.

7. Remedies. Upon the occurrence of any Event
of Default and at any time thereafter during the continuance thereof, MLBFS
may, at its option, and in addition to all other rights and remedies available
to MLBFS: (a) by written notice to MLPF&S, terminate all rights of Customer
with respect to control of the Collateral (it being understood, however, that
upon the occurrence of any Bankruptcy Event all rights of Customer with respect
to control of the Collateral shall automatically terminate without notice or
other action on the part of MLBFS), and thereby obtain the right to exclusive
control over the Collateral, including, without limitation, the right to cancel
any open orders and close any and all outstanding contracts, liquidate all or
any part of the Collateral, transfer the Securities Account or any other
Collateral to the name of MLBFS or its nominee, and withdraw any Collateral
from the Securities Account; and (b) exercise any one or more of the rights and
remedies of a secured party under the UCC. Any sale of Collateral pursuant to
this Paragraph may be made at MLBFS' discretion on any exchange or other market
where such business is usually transacted, or at public auction or private
sale, and MLBFS or MLBFS' agent may at any such sale be the purchaser for the
account of MLBFS or such agent. The proceeds of sale or other disposition of
any of the Collateral shall be applied by MLBFS on account of the Obligations,
with any excess paid over to Customer or
its successors or assigns, as their interests and rights may appear, or whoever
else may then be adjudged entitled thereto. To the fullest extent
permitted by law, Customer waives notice of any sale, advertisement and all
other notices and formalities whatsoever. All rights and remedies available to
MLBFS hereunder shall be cumulative and in addition to all other rights and
remedies otherwise available to it at law, in equity or otherwise, and any one
or more of such rights and remedies may be exercised simultaneously or
successively. No waiver by MLBFS of any Event of Default shall waive any other
or subsequent Event of Default. None of the provisions hereof shall be held to
have been waived by any act or knowledge of MLBFS, but only by a written
instrument executed by an officer of MLBFS and delivered to Customer.

 

8. Power of Attorney. Customer further agrees
that MLBFS shall have and hereby irrevocably grants to MLBFS, effective upon
the occurrence and during the continuance of any Event of Default, the full and
irrevocable right, power and authority in the name of Customer or in MLBFS' own
name, to demand, collect, withdraw, receipt for and sue for the Securities
Account and any or all of the other Collateral, and all amounts due or to
become due and payable upon or with respect to the Collateral; to execute any
withdrawal receipts respecting any or all of the Collateral; to endorse the
name of Customer on any and all commercial paper and other instruments given in
payment therefor; and, in its discretion, to take any and all further action
(including, without limitation, the transfer of the Securities Account or any
other Collateral to the name of MLBFS or its nominee) which MLBFS shall deem
necessary or appropriate to preserve or protect its interests hereunder.

9. Rights Absolute. The rights of MLBFS
hereunder and with respect to the Collateral are absolute and unconditional,
and nothing that MLBFS does or leaves undone shall affect such rights of MLBFS.
Without limiting the foregoing, MLBFS shall not as a condition of such rights
be required to resort to any other collateral or security, pursue or exhaust
any remedy against Customer or any other party or observe any formality of
notice or otherwise (except as expressly provided herein); and (ii) Customer
hereby consents to, and waives notice of, any extension, renewal or
modification from time to time of any of the Loan Agreements or any other
agreement, instrument or document evidencing or securing the Obligations, any
extensions, forbearances, compromises or releases of any of the Obligations,
and the release of any party primarily or secondarily obligated for the
Obligations or of any other collateral therefor.

10. Limitation of MLBFS' Obligations. MLBFS
shall not as a result of this Security Agreement be subjected to any obligation
or liability of Customer of any manner or type with respect to the Collateral,
including, but not limited to, the duty to perform any covenants and agreements
made by Customer; all of which obligations and liabilities shall continue to
rest upon Customer as though this Security Agreement had not been made.

11. MLPF&S Not Authorized. CUSTOMER
ACKNOWLEDGES
AND AGREES THAT NOTWITHSTANDING THE AFFILIATION BETWEEN MLBFS AND MLPF&S,
AND THE AGENCY RELATIONSHIP ACKNOWLEDGED BY MLPF&S IN THE CONSENT HERETO,
NEITHER MLPF&S NOR ANY OF ITS EMPLOYEES ARE AUTHORIZED TO WAIVE ON
BEHALF OF MLBFS ANY PROVISION HEREOF, OR CONSENT ON BEHALF OF MLBFS TO ANY
ACTION OR INACTION BY CUSTOMER, OR OTHERWISE BIND MLBFS.

12. Term. This Security Agreement shall become
effective when signed by Customer, and shall continue in effect so long
thereafter as any of the Loan Agreements shall be in effect or there shall be
any Obligations outstanding.

13. Miscellaneous.

(a) Customer waives notice of the acceptance
hereof by MLBFS.

(b) Titles to Paragraphs are for convenience
only and shall not be considered in the interpretation hereof.

(c) This Security Agreement shall be binding
upon Customer and Customer's heirs, personal representatives, successors and
assigns, as applicable, and shall inure to the benefit of MLBFS and its
successors and assigns. If there is more than one "Customer", their
obligations hereunder are joint and several.

(d) THIS WRITTEN SECURITY AGREEMENT CONSTITUTES THE ENTIRE
AGREEMENT BETWEEN THE PARTIES WITH RESPECT TO THE SUBJECT MATTER HEREOF, MAY BE
MODIFIED ONLY BY A WRITTEN INSTRUMENT EXECUTED BY BOTH MLBFS AND CUSTOMER, AND
MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT
ORAL AGREEMENTS BETWEEN THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS
BETWEEN THE PARTIES.

(e) THIS SECURITY AGREEMENT SHALL BE GOVERNED IN ALL
RESPECTS BY THE LAWS OF THE STATE OF ILLINOIS. WITHOUT LIMITING THE RIGHT OF
MLBFS TO ENFORCE THIS SECURITY AGREEMENT IN ANY JURISDICTION AND VENUE
PERMITTED BY APPLICABLE LAW: (I) CUSTOMER AGREES THAT THIS SECURITY AGREEMENT
MAY AT THE OPTION OF MLBFS BE ENFORCED BY MLBFS IN ANY JURISDICTION AND VENUE
IN WHICH ANY OF THE LOAN AGREEMENTS MAY BE ENFORCED, (II) CUSTOMER IRREVOCABLY
SUBMITS ITSELF TO JURISDICTION IN THE STATE OF ILLINOIS AND VENUE IN ANY STATE
OR FEDERAL COURT IN THE COUNTY OF COOK FOR SUCH PURPOSES, AND (III) CUSTOMER
WAIVES ANY AND ALL RIGHTS TO CONTEST SAID JURISDICTION AND VENUE AND THE
CONVENIENCE OF ANY SUCH FORUM AND ANY AND ALL RIGHTS TO REMOVE SUCH ACTION FROM
STATE TO FEDERAL COURT. CUSTOMER FURTHER AGREES THAT ANY CLAIM BY CUSTOMER
AGAINST MLBFS HEREUNDER OR WITH RESPECT TO ANY OF THE TRANSACTIONS CONTEMPLATED
HEREBY SHALL BE BROUGHT AGAINST MLBFS ONLY IN AN ACTION OR PROCEEDING IN A
FEDERAL OR STATE COURT IN THE COUNTY OF COOK AND STATE OF ILLINOIS, AND
CUSTOMER WAIVES THE RIGHT TO BRING ANY SUCH ACTION OR PROCEEDING OR ASSERT ANY
COUNTERCLAIM AGAINST MLBFS IN ANY OTHER JURISDICTION OR BEFORE ANY OTHER FORUM.
CUSTOMER FURTHER WAIVES THE RIGHT TO BRING ANY NON-COMPULSORY COUNTERCLAIMS.

(f) CUSTOMER AND MLBFS HEREBY EACH EXPRESSLY WAIVE ANY
AND ALL RIGHTS TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM
BROUGHT BY EITHER OF THE PARTIES AGAINST THE OTHER PARTY IN ANY WAY RELATED TO
OR ARISING OUT OF THIS SECURITY AGREEMENT, ANY OF THE LOAN AGREEMENTS OR ANY OF
THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

Dated as of the day and year first above
written.

STOCKERYALE,
INC. F/K/A STOCKER & YALE, INC.

 

	By:	/s/ Mark W. Blodgett	/s/ Gary B. Godin
	 	

	 	 	 
	 	Signature (1)	Signature (2)
	 	Mark W. Blodgett	Gary B. Godin
	

	 	Printed Name	Printed Name
	 	CEO	CFO
	

	 	Title	Title
							

 

ACCEPTED AT CHICAGO, ILLINOIS:

MERRILL LYNCH BUSINESS

FINANCIAL SERVICES INC.

	By:	/s/ Julie Ellman
	 	

 

 

	 	FR U-1
	 	OMB No. 7100-0115
	 	Approval Expires March 31, 2002

 

BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM

Statement of Purpose for an Extension of Credit Secured by Margin Stock

(Federal Reserve Form U-1)

	MERRILL LYNCH BUSINESS
  FINANCIAL SERVICES INC.
	

	Name
  of Bank
	 
	This report is require by law (15 U.S.C. 78g
  and 78w; 12 CFR 221). The Federal Reserve may not conduct or sponsor, and an
  organization (or a person) is not required to respond to, a collection of
  information unless it  displays a
  currently valid OMB control number.	 	Public reporting burden for this collection of
  information is estimated to average 0.07 hours per response, including the
  time to gather and maintain data in the required form and to review
  instructions and complete the information collection. Send comments regarding
  this burden estimated or any other aspect of this Collection of information,
  including suggestions for reducing this burden to: Secretary, Board of Governors
  of the Federal Reserve System, 20th and C Streets, N.W., Washington, DC
  20551; and to the Office of Management and Budget, Paperwork Reduction
  Project (7100-0011), Washington, DC 20503.

Instructions

1.          This
form must be completed when a bank extends credit in excess of $100,000 secured
directly or indirectly, in whole or in part, by any margin stock.

2.          The
term "margin stock" is defined in Regulation U (12 CFR 221) and
includes, principally: (1) stocks that are registered on a national securities
exchange; (2) debt securities (bonds) that are convertible into margin stocks;
(3) any over-the-counter security designated as qualified for trading in the
National Market System under a designation plan approved by the Securities and
Exchange Commission (NMS security); and (4) shares of most mutual funds, unless
95 per cent of the assets of the fund are continuously invested in U. S.
government, agency, state or municipal obligations.

3.          Please
print or type (if space is inadequate, attach separate sheet).

Part I  
To be completed by borrower(s)

1.  
What is the amount of the credit being extended?  $6,000,000.00

	2.   Will any part of this credit be used to
  purchase or carry margin stock? 	o	Yes	ý	No	 

If
the answer is "no", describe the specific purpose of the
credit:  To provide working capital
and/or for other lawful business purposes

 

I (We) have read this form and certify that to
the best of my (our) knowledge and belief the information given is true,
accurate, and complete, and that the margin stock and any other securities
collateralizing this credit are authentic, genuine, unaltered, and not stolen,
forged or counterfeit.

Signed: StockerYale, Inc. f/k/a Stocker & Yale, Inc.

	/s/ Mark W. Blodgett	5/14/01	 	/s/ Gary B. Godin	5/14/01
	

	 	

	 
  Borrower's signature	Date	 	Borrower's signature	Date
	Mark W. Blodgett	 	 	Gary B. Godin	 
	

	 	

	  Print
  or type name	 	 	Print or type name	 

This form should not be signed in blank

A
borrower who falsely certifies the purpose of a credit on this form or
otherwise willfully or intentionally evades the provisions of Regulation U will
also violate Federal Reserve Regulation X, "Borrowers of Securities
Credit."

Part II  
To be completed by bank only if the purpose of the credit is to purchase
or carry margin securities (Part I (2) answered "yes")

1.          List the margin stock securing this
credit; do not include debt securities convertible into margin stock. The
maximum loan value of margin stock is 50 per cent of its current market value
under the current Supplement to Regulation U.

	No. of shares	Issue	Market Price

  per share	Date and source of

  valuation

  (See note below)	Total market

  value per issue
	

	

	

	

	

	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 

2.          List
the debt securities convertible into margin stock securing this credit. The
maximum loan value of such debt securities is 50 per cent of the current market
value under the current Supplement to Regulation U.

	Principal

  Amount	Issue	Market
  Price	Date
  and source of

  valuation

  (See note below)	Total
  market

  value per issue
	

	

	

	

	

	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 

3.          List
other collateral including non-margin stock securing this credit.

	Describe
  briefly	Market
  Price	Date
  and source of

  valuation

  (See note below)	Good
  faith

  loan value
	

	

	

	

	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 

Note: Bank need not complete "Date and
source of valuation" if the market value was obtained from regularly
published information in a journal of general circulation or an automated
quotation system.

Part III 
To be signed by a bank officer in all instances.

I am a duly authorized representative of the
bank and understand that this credit secured by margin stock may be subject to
the credit restrictions of Regulation U. I have read this form and any
attachments, and I have accepted the customer's statement in Part I in good
faith as required by Regulation U*; and I certify that to the best of my
knowledge and belief, all the information given is true, accurate, and
complete. I also certify that if any securities that directly secure the credit
are not or will not be registered in the name of the borrower or its nominee, I
have or will cause to have examined the written consent of the registered owner
to pledge such securities. I further certify that any securities that have been
or will be physically delivered to the bank in connection with this credit have
been or will be examined, that all validation procedures required by bank
policy and the Securities Exchange Act of 1934 (section 17(f), as amended) have
been or will be performed, and that I am satisfied to the best of my knowledge
and belief that such securities are genuine and not stolen or forged and their
faces have not been altered.

*To accept the customer's statement in good
faith, the officer of the bank must be alert to the circumstances surrounding
the credit and, if in possession of any information that would cause a prudent
person not to accept the statement without inquiry, must have investigated and
be satisfied that the statement is truthful. Among the facts which would
require such investigation are receipt of the statement through the mail or
from a third party.

	 	 	 	Signed:
	 	 	 	 	 	 	 	 
	

	 	

	Date	 	 	 	Bank officer's signature
	 	 	 	 
	 	 	 	 	 	 	 	 
	

	 	

	Title	 	 	 	Print or type name

This
form must be retained by the lender for three years after the credit is
extinguished.

 

	
	SECRETARY'S CERTIFICATE

(Financial
Asset Security Agreement)

The
undersigned hereby certifies that the undersigned is the duly appointed and
acting Secretary (or Assistant Secretary) of STOCKERYALE, INC. F/K/A STOCKER &
YALE, INC., a corporation duly organized, validly existing and in
good standing under the laws of the State of Massachusetts, and that the
following is a true, accurate and compared transcript of resolutions duly,
validly and lawfully adopted on the 19 day of March, 2001 by the Board of
Directors of said corporation acting in accordance with the laws of the state
of incorporation and the charter and by-laws of said corporation:

“RESOLVED, that it is advisable and in the
best interests of this Corporation that this Corporation grant to MERRILL
LYNCH BUSINESS FINANCIAL SERVICES INC. (“MLBFS”) a security interest
in one or more Merrill Lynch securities accounts, all successor security
accounts, and all securities and other financial assets, investment property
and other property now and hereafter therein or controlled thereby
(collectively, the “Collateral”) as collateral for its obligations to MLBFS;
and

“FURTHER RESOLVED, that the President, any
Vice President, Treasurer, Secretary or other officer of this Corporation, or
any one or more of them, be and each of them hereby is authorized and empowered
for and on behalf of this Corporation to: (a) grant to MLBFS a first and prior
security interest in the Collateral and any other property of this Corporation;
(b) execute and deliver to MLBFS: (i) all Financial Assets Security Agreements
and all other agreements, instruments and documents now and hereafter required
by MLBFS, and (ii) any present or future amendments to any of the foregoing;
all in such form as such officer shall approve, as conclusively evidenced by
his signature thereon; and (c) do and perform all such acts and things deemed
by any such officer to be necessary or advisable to carry out and perform the
undertakings and agreements of this Corporation in connection therewith; and
all prior acts of said officers in these premises are hereby ratified and
confirmed; and

“FURTHER RESOLVED, that MLBFS is authorized to rely upon the
foregoing resolutions until it receives written notice of any change or
revocation, which change or revocation shall not in any event affect the
obligations of this Corporation with respect to any transaction committed to by
MLBFS or having its inception prior to the receipt of such notice by MLBFS.”

The
undersigned further certifies that the foregoing resolutions have not been rescinded,
modified or repealed in any manner and are in full force and effect as of the
date of this Certificate, and that the following individuals are now the duly
elected and acting officers of said corporation and the signatures set forth below are the true
signatures of said officers:

	 	President:	/s/ Mark W. Blodgett
	 	 	

	 	Vice President:	 
	 	 	

	 	Secretary:	/s/ Gary B. Godin
	 	 	

	 	Treasurer:	/s/ Gary B. Godin
	 	 	

IN
WITNESS WHEREOF,
the undersigned has executed this Certificate and has affixed the seal of said
corporation hereto, pursuant to due authorization, all as of this 14 day of
May, 2001.

 

(Corporate
Seal)

	 	/s/ Gary B. Godin	 
	 	

	 
	 	 	Secretary	 
	 	 	 	 
	 	/s/ Gary B. Godin	 
	 	

	 
	 	 	Printed NamePrepared by MerrillDirect

Exhibit 10.6(a)

SECOND
AMENDMENT TO IPO APPROVAL AND

LOCKUP AGREEMENT

             This
Second Amendment to IPO Approval and Lockup Agreement (this “Second
Amendment”), dated as of July 25, 2001, is by and among Nextel WIP Corp.
(“NIP”), Nextel Partners, Inc. (the “Company”), DLJ Merchant Banking Partners,
II, L.P. (“DLJMB”), Madison Dearborn Capital Partners II, L.P. (“MDP”), Eagle
River Investments, LLC, John Chapple, John Thompson, David Thaler, David Aas,
Perry Satterlee, Mark Fanning and Donald Manning (each, a “Stockholder,” and
collectively, the “Stockholders”).

R E C I T A L S

             A.         The Stockholders, other than Donald
Manning, along with certain other entities, are parties to that Amended and
Restated Shareholders’ Agreement dated as of February 18, 2000, as amended
effective as of February 22, 2000, March 20, 2001 and April 18, 2001
(collectively, the “Shareholders’ Agreement”). 
Unless otherwise defined in this Second Amendment, all capitalized terms
used in this Second Amendment shall have the same meanings ascribed to such
terms in the Shareholders’ Agreement.

             B.          All of the Stockholders are parties to
that certain IPO Approval and Lockup Agreement dated effective as of     February 22, 2000, as amended as of April
18, 2001 (collectively, the “Lockup Agreement”), which, among other things,
imposes certain restrictions on the Stockholders’ ability to sell or otherwise
transfer their shares of Company Capital Stock.

             C.          The Stockholders desire to amend the
Lockup Agreement in order to allow the parties thereto to transfer their shares
of Company Capital Stock in connection with transactions commonly referred to
as “hedging transactions” for the sole purpose of offsetting their respective
investment risk.

             D.         In addition, DLJMB and MDP desire to
make a joint Demand Registration request pursuant to Section 6.01 of the
Shareholders’ Agreement; provided, however, that the Shareholders’ Agreement
and the Lockup Agreement prohibit the making of such Demand Registration
request prior to August 22, 2001 unless all of the Stockholders consent in
writing to the sale of Common Stock pursuant to such Demand Registration.

             E.          The Stockholders desire to consent to
the sale of Common Stock pursuant to a Demand Registration.

A G R E E M E N T S

             The parties hereto agree as
follows:

             1.          The Stockholders hereby amend the
Lockup Agreement in order to allow DLJMP and MDP to make a joint Demand
Registration request prior to August 22, 2001 in accordance with the terms of
the Shareholders’ Agreement and to sell their respective shares of Company
Common Stock pursuant to such Demand Registration.

             2.          The Stockholders hereby amend and
restate Section 3 of the Lockup Agreement in its entirety as follows:

           “3.           The
lock-up provisions set forth in Paragraph 2 above shall not apply to the
following:

	 	(a)	A
  transfer, sale, contract to sell, pledge, assignment or other disposition by
  the undersigned to a Permitted Transferee as defined in the Shareholders’
  Agreement.
	 	 	 
	 	(b)	A
  transfer, sale, contract to sell, assignment or other disposition caused by
  or resulting from the exercise of any put, call, repurchase or tag along
  right set forth in the Shareholders’ Agreement, the Restricted Stock Purchase
  Agreements between NPI and Messrs. Chapple, Thompson, Aas, Satterlee,
  Fanning, Thaler and Manning, or any other agreement between or among the
  Company, NWIP or any of the shareholders who are parties to the Shareholders’
  Agreement.  It is the intention of the
  parties hereto that Paragraph 2 shall not affect, interfere with or otherwise
  prevent the parties hereto from exercising, pursuing or participating in any
  put, call, repurchase, or tag along rights set forth in the Shareholders’
  Agreement or the Restricted Stock Purchase Agreements.
	 	 	 
	 	(c)	A
  pledge of shares of Company Capital Stock by any of the undersigned parties
  in the ordinary course of using the credit facilities of any such party.
	 	 	 
	 	(d)	A
  transfer, sale, contract to sell, assignment or other disposition by the
  undersigned that constitutes a “hedging transaction” or similar transaction
  for the sole purpose of offsetting the undersigned’s investment risk; provided,however, that (a) in any such transaction, a Shareholder
  may not subject to the hedging transaction more than an aggregate of 20% of
  such Shareholder’s Initial Ownership, (b) a Shareholder may not engage in
  more than one hedging transaction in any twelve-month period and (c) the date
  that the Shareholder executes any documents or otherwise commits to engage in
  any such hedging transaction must be at least twelve months prior to the date
  on which the Shareholders’ ownership interest in any of the Shares involved
  in such hedging transaction are transferred, assigned or otherwise conveyed.”

 

             3.          The remainder of the Lockup Agreement
is not amended hereby and shall remain in full force and effect.  Each of the Stockholders hereby ratifies and
confirms the terms and conditions of the Lockup Agreement, as supplemented and
amended by this Second Amendment.

             4.          This
Second Amendment may be executed in counterparts and via fax with the same
force and effect as if all original signatures had been placed on the same
original signature page.

 

             This Second Amendment is executed
as of the day and year first written above.

	NEXTEL WIP CORP.	 	NEXTEL PARTNERS, INC.
	 	 	 	 	 
	By:	/s/
  Timothy Donahue	 	By:	/s/
  John Chapple
	 	

	 	 	

	Its:	 	 	 	John Chapple, Chief
  Executive Officer
	 	

	 	 	 
	 	 	 	 	 
	DLJ MERCHANT BANKING PARTNERS II, L.P.	 	MADISON DEARBORN CAPITAL PARTNERS II, L.P.
	 	 	 
	By:	DLJ Merchant Banking II, Inc., 

  as managing general partner	 	By:	Madison Dearborn Partners II L.P., its General
  Partner
	 	 	 	By:	Madison Dearborn Partners, Inc., its General
  Partner
	 	 	 	 	 
	 	 	 	 	 
	By:	/s/
  Andrew Rush	 	By:	/s/
  Andrew Sinwell
	 	

	 	 	

	Its:	 	 	Its:	 
	 	

	 	 	

	 	 	 	 	 
	EAGLE RIVER INVESTMENTS, LLC	 	 	 
	 	 	 	 	 
	By:	/s/
  Dennis Weibling	 	 	 
	 	

	 	 	 
	Its:	 	 	 	 
	 	

	 	 	 
	 	 	 	 	 
	/s/
  John Chapple	 	/s/
  John Thompson
	

	 	

	John Chapple	 	John Thompson
	 	 	 	 	 
	/s/
  David Thaler	 	/s/
  David Aas
	

	 	

	David Thaler	 	David Aas
	 	 	 	 	 
	/s/
  Perry Satterlee	 	/s/
  Mark Fanning
	

	 	

	Perry Satterlee	 	Mark Fanning
	 	 	 	 	 
	/s/
  Donald Manning	 	 	 
	

	 	 	 
	Donald Manning

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