SECURITY AGREEMENT
Exhibit
10.2
1. Parties.
This
Agreement is made on June 30, 2008, between Beacon Power Corporation, a Delaware
corporation with its chief executive office presently at 00 Xxxxxxxxx Xxxx,
Xxxxxxxxx, Xxxxxxxxxxxxx 00000 (herein called "Borrower"), and Massachusetts
Development Finance Agency, a body politic and corporate created by Chapter
289
of the Acts of 1998 and established under Massachusetts General Laws Chapter
23G, as amended, with a principal place of business and mailing address of
000
Xxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000 (herein called
"MassDevelopment").
2. Security
Interest.
(a) Borrower
hereby grants to MassDevelopment a continuing and exclusive first priority
security interest in all equipment purchased with proceeds of the Loan defined
below in section 2(b), including but not limited to the equipment (the
“Equipment”) and the tenant improvements (the “Tenant Improvements” and,
together with the Equipment, the “Collateral”) listed on Schedule
A
attached
hereto.
(b) The
Collateral shall secure prompt, punctual and faithful observance, payment and
performance of each and every obligation, covenant and agreement of Borrower
under the Loan Documents, as defined below, including, but not limited to,
payment of all amounts due from time to time under that certain Promissory
Note
of even date herewith in the original principal amount of Five Million Dollars
($5,000,000), payable by Borrower to MassDevelopment (the “Note”, and together
with this Agreement, the “Loan Documents”) evidencing and securing a loan in the
same amount from the Borrower to the MassDevelopment (the “Loan”). Upon payment
in full of the Note, MassDevelopment shall at Borrower’s expense, promptly take
any reasonable steps to evidence the termination of its security interest in
the
Collateral.
3. Location
of Collateral.
The
Collateral shall be kept and used by the Borrower solely at the manufacturing
facility at 00 Xxxxxxxxx Xxxx, Xxxxxxxxx, Xxxxxxxxxxxxx (the “Premises”). Other
than removals for the purpose of repair or replacement in the ordinary course
of
any of the Collateral, the Borrower shall not remove the Collateral, nor any
part thereof, from the Premises without the written consent of MassDevelopment.
4. After-Acquired
Property.
All
replacements of and renewals to the Collateral shall become and be immediately
subject to the security interest provided herein and be covered thereby.
Borrower warrants and represents that all Collateral now is, and that all
replacements thereof, substitutions therefor or additions thereto will be,
free
and clear of liens, encumbrances or security interests of others, except for
security interests junior in priority to the interest created by this Agreement
and to which MassDevelopment, at its option and in its sole and absolute
discretion, shall consent.
5. Representations
and Warranties.
Borrower warrants and represents that:
(a) Borrower
is a corporation, duly established under the laws of the State of Delaware
and
qualified to conduct business in the Commonwealth of Massachusetts, and that
the
execution of the Loan Documents and any other instruments executed in connection
therewith constitute representations by the individual in his capacity as a
duly
authorized officer of Borrower signing the Loan Documents and said instruments,
and by Borrower, that such execution has received all such authorization as
may
be necessary to permit such execution, and that the Loan Documents and said
instruments are binding and in force against Borrower;
(b) prior
to
the date hereof Borrower has never: disposed of, transported, or arranged for
the transport of any hazardous material or oil without compliance in all
material respects with all applicable statutes, regulations, ordinances,
directives, and orders; been legally responsible for any release or threat
of
release of any hazardous material or oil; received notification of any potential
or known release or threat of release of any hazardous material or oil from
any
site or vessel occupied or operated by Borrower and/or of the incurrence of
any
expense or loss in connection with the assessment, containment, or removal
of
any release or threat of release of any hazardous material or oil from any
such
site or vessel;
(c) one-half
of the principal amount of the Note does not constitute more than twenty-five
percent (25%) of the overall project expenses scheduled to be expended for
Borrower’s improvement of the Premises, including the acquisition of the
Equipment for use at the Premises;
(d) Borrower
has filed any and all federal, state and local tax returns required as of the
date hereof and has paid any and all taxes due thereon, except to the extent
contested in good faith and adequate reserves are made in accordance with
generally accepted accounting principles (“GAAP”); and
(f) except
as
previously disclosed to MassDevelopment by Borrower or as otherwise disclosed
by
Borrower in its public filings, there is no action, suit claim, proceeding,
investigation or arbitration proceeding pending (or, to the knowledge of
Borrower, threatened) against or otherwise involving Borrower or any of the
officers, directors, former officers or directors, employees, shareholders
or
agents of Borrower (in their capacities as such) and there are no outstanding
court orders to which Borrower is a party or by which any of its assets are
bound that, in each case, would reasonably be expected to have a material
adverse effect on the Borrower or the collateral for the Loan. Borrower has
no
reason to believe that any such action, suit, proceeding, investigation or
arbitration proceeding may be brought against Borrower.
6. Further
Covenants of Borrower.
Borrower further covenants as follows:
(a) to
pay
before the same become delinquent (and to provide, by such time, evidence of
such payment, satisfactory to MassDevelopment) all taxes (including real estate
taxes) on the Collateral; and to pay before the same become delinquent (and
upon
request, to provide evidence of such payment, satisfactory to MassDevelopment)
all other charges, sewer use fees, water rates and assessments of every name
and
nature, whether or not assessed against the Borrower, if applicable or
reasonably related to the Premises, or any interest therein, or the debt,
obligation or any agreement secured hereby, or the disbursement or the
application or the proceeds thereof. Borrower shall have the right to contest
the validity, applicability or amount of any asserted tax provided that, in
MassDevelopment's sole discretion exercised in good faith, such contest will
not
impair the validity or priority of the lien of created by this Agreement and
the
Mortgage and provided that the full amount of such tax is either paid to the
taxing authority under protest or reserved in accordance with GAAP;
(b) to
notify
MassDevelopment promptly of any accidental damage to the Collateral in excess
of
twenty-five thousand dollars ($25,000); to keep the Collateral in good order,
repair and condition, damage from casualty and from ordinary wear and tear
excepted; and all construction on the Premises shall comply with, and each
and
every part of the Premises shall be maintained in accordance with, any lawful
requirements or provisions, public or private, relating to the same or the
use
thereof;
(c) that
all
proceeds of casualty insurance policies relating to the Collateral for claims
in
excess of twenty-five thousand dollars ($25,000) shall be paid to
MassDevelopment and shall be released to Borrower to pay for the costs of repair
and restoration of the Collateral; and to the extent MassDevelopment retains
any
funds not required for repair and restoration, those funds shall be, at
MassDevelopment's option, applied toward the indebtedness secured
hereby;
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(d) that
the
awards of damages on account of any condemnation for public use of or injury
to
the Premises, to the extent affecting the Collateral, shall be paid to
MassDevelopment; and promptly upon obtaining knowledge of the institution of
any
proceedings on account of any condemnation for public use of or injury to the
Premises, or any portion thereof, Borrower will notify MassDevelopment of the
pendency of such proceedings, and no settlement respecting such awards which
affect the Collateral or Borrower’s access to or ability to use the Collateral
shall be effected without the consent of MassDevelopment;
(e) to
pay
when due all reasonable out-of-pocket fees and charges incurred and billed
to
Borrower by MassDevelopment incident to the loan transaction evidenced by the
Loan Documents, as well as any and all commitment fees remaining due
thereunder;
(f) that,
from time to time, on the request of MassDevelopment, Borrower shall furnish
a
written statement, signed and if requested, acknowledged, setting forth the
amount of the indebtedness which Borrower acknowledges to be due on the Note,
specifying any claims of off-set or defense which Borrower asserts against
the
indebtedness secured hereby or any obligations to be paid or performed
hereunder; and to deliver to MassDevelopment promptly copies of all junior
mortgages, security agreements, assignments of leases and rents and similar
instruments which Borrower may create with respect to the Premises, together
with copies of any notices from any holder of such an instrument claiming that
Borrower is in default in the performance or observance of any of the terms
thereof;
(g) that
whether or not for additional interest or other consideration paid or payable
to
MassDevelopment, no forbearance on the part of MassDevelopment or extension
of
the time for payment of the whole or any part of the obligations secured hereby,
whether oral or in writing, or any other indulgence given by MassDevelopment
to
Borrower or to any other party claiming any interest in or to the Collateral,
shall operate except as provided by the forbearance or indulgence to release
or
in any manner affect the original liability of Borrower, or impair any right
of
MassDevelopment, including, without limitation, the right to realize, upon
the
security or any part thereof, for the obligations secured hereby or any of
them,
notice of any such extension, forbearance or indulgence being waived by Borrower
and all those claiming by, through or under Borrower; and no consent or waiver,
express or implied, by the holder to or of any default by the Borrower shall
be
construed as a consent or waiver to or of any further default in the same or
any
other term, condition, covenant or provision of this Agreement or of the
obligations secured hereby; in case redemption is had by Borrower after
foreclosure proceedings have begun, MassDevelopment shall be entitled to collect
all reasonable costs, charges and expenses incurred up to the time of
redemption; and in case any one or more of the provisions of this Agreement
may
be found to be invalid or unenforceable for any reason or in any respect, such
invalidity shall not limit or impair enforcement of any other provision
hereof;
(h) that,
except for real estate taxes and assessments before any delinquency therein
(delinquency with reference to such taxes and assessments being herein defined,
for the purpose of this Agreement, as meaning the time when, on the nonpayment
thereof, interest or penalties commence to accrue), Borrower shall not create,
permit or suffer to be created or permitted to remain (and shall discharge
or
promptly cause to be discharged or bonded over) any mechanics' or laborers'
lien
of record, or any attachment, on the Collateral or any part thereof or interest
therein, without the consent of MassDevelopment which may be withheld in
MassDevelopment's sole and absolute discretion, even if such encumbrance is
inferior to the interest secured hereby; without limitation, and except where
MassDevelopment receives independent security satisfactory to MassDevelopment
during the pendency of legal proceedings contesting the impositions of a
Governmental lien, the filing of a notice of Federal or State tax lien with
MassDevelopment or the office at which, by law, such notice is to be filed
to be
effective against the Collateral, whether or not such lien applies, in terms,
to
the Collateral, shall be a breach of this condition;
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(i) that
Borrower shall not file a petition or any application for relief, extension,
moratorium or reorganization under any bankruptcy, insolvency or debtor's relief
law, or make an assignment for the benefit of creditors or enter into any trust
mortgage arrangements, so-called, or consent to the appointment of a receiver
of
any of the property of Borrower, including the Collateral;
(j) that
Borrower shall not permit any petition under any bankruptcy, insolvency or
debtor's relief law filed against it to remain undischarged for a period of
more
than forty-five (45) days after the filing thereof, nor shall Borrower permit
the continuation of any receivership proceedings instituted against it for
more
than a period of forty-five (45) days after the commencement
thereof;
(k) that
Borrower shall not dispose of any hazardous material or oil on the land on
which
the Premises is located; nor store or transport or arrange for the transport
of
any hazardous material or oil on such property except if such disposal, storage
or transport is in the ordinary course of Borrower's business and is in
compliance with all applicable statutes, regulations, ordinances, directives
and
orders; if Borrower obtains knowledge or notice of any potential or known
release or threat of release of any hazardous material or oil at or from any
site or vessel occupied or operated by Borrower, and/or upon Borrower's
obtaining knowledge of any incurrence of any expense or loss by any governmental
authority in connection with the assessment, containment, or removal of any
hazardous material or oil for which expense or loss Borrower may be liable,
then
in either of such events, Borrower shall take all such reasonable action,
including without limitation the conducting of engineering tests, to confirm
whether or not a potential or known release or threat of release of any
hazardous material or oil exists and to undertake all necessary remediation
required under Mass. Gen. Laws Ch. 21E and the Massachusetts Contingency
Plan;
(l) that
Borrower, at Borrower's expense, shall furnish to MassDevelopment (i) copies
of
its audited annual financial statements prepared by a certified public
accountant in accordance with GAAP, as and when prepared, for such fiscal year,
certified as complete, true and accurate by the Borrower, within one hundred
twenty (120) days of the end of Borrower's fiscal year, (ii) copies of its
quarterly financial statements as prepared by management within sixty (60)
days
after the end of each fiscal quarter throughout the term of the Loan, and (iii)
any additional financial documentation reasonably requested in writing by
MassDevelopment, including so-called Requests for Information from either
MassDevelopment or any of MassDevelopment’s participants in the Loan (but not
more than twice annually absent an Event of Default), with Borrower’s response
made to both MassDevelopment and all participants, notwithstanding that only
MassDevelopment or one or more participants may have submitted the Request
for
Information; MassDevelopment shall have the right to inspect the Premises at
its
sole cost and the books and records of Borrower for the purpose of verifying
the
accuracy of such financial documents (or, for the purpose of conducting its
own
audit at Borrower’s cost of the records and books of account of Borrower if
Borrower fails to furnish or cause to be furnished and delivered the aforesaid
financial documents), provided, however, that MassDevelopment shall not have
the
right to exercise its audit rights with respect to the books and records more
than once in any calendar year, except upon and during the continuance of any
Event of Default. Notwithstanding anything to the contrary in this Section
6(l),
if the Borrower has not filed its 10-K’s or 10-Q’s by the deadlines provided in
this Section for the filing of its financial statements with MassDevelopment,
MassDevelopment agrees to keep all such financial information filed with it
confidential. Unless MassDevelopment obtains a similar agreement of
confidentiality from its participants in the Loan, MassDevelopment will not
forward such statements to its participants in the Loan before they become
available to the public; and
(m) that
Borrower has not granted, and shall not grant after the date hereof and
throughout the full term of the Note, a security interest to any third party
in
any of the Equipment constituting Collateral for the Loan.
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7. Insurance.
Borrower agrees to maintain such insurance on the Collateral and its use as
MassDevelopment may from time to time reasonably require and as may from time
to
time be required by any applicable Federal, State or local law or regulation
including, without limitation, a general liability insurance policy naming
MassDevelopment as an additional insured in an amount reasonably acceptable
to
MassDevelopment, and fire and extended coverage insurance against loss or damage
to the Collateral by fire and any of the risks covered by insurance of the
type
now known as "extended coverage", including without limitation earthquake,
cost
of demolition, vandalism, malicious mischief, lightning, windstorm, hail,
explosion, riot, civil commotion, damage from aircraft and vehicles, smoke
damage, and sprinkler damage for not less than full replacement cost of the
Collateral from time to time during the period of time this Agreement remains
in
force and effect; and certificates of insurance or insurance binders in forms
satisfactory to MassDevelopment, evidencing the insurance required by
MassDevelopment, together with any other insurance with respect to the
Collateral maintained by Borrower, shall be deposited with MassDevelopment,
and,
MassDevelopment shall be added and named as an insured and loss payee, and
shall
be first payable to MassDevelopment in case of loss, as provided in Section
6(c)
above; all renewals or replacements of such insurance from time to time in
force, together with evidence of payment of premiums thereon reasonably
satisfactory to MassDevelopment, shall be delivered to MassDevelopment ten
(10)
days at least before the expiration date of the then current insurance; all
insurance required by MassDevelopment to be maintained with respect to the
Property shall be written by such companies on such terms, in such form and
for
such periods and amounts as MassDevelopment shall from time to time reasonably
approve and shall contain a provision requiring at least thirty (30) days'
advance written notice to MassDevelopment before any such policy may be
cancelled or modified; and no settlement on account of any loss covered by
such
insurance shall be effected without the consent of
MassDevelopment.
8. Remedies
of MassDevelopment.
(a) In
the
case of (i) an Event of Default under the Note or (ii) a violation by Borrower
of its obligations under this Agreement not remedied within thirty (30) days
after written notice thereof from MassDevelopment
to the
attention of the Borrower’s Chief Financial Officer and to Borrower’s counsel,
Xxxxxxx Xxxxxx Xxxxxx & Dodge LLP, attn: Xxxxxx Xxxxx, Esq.
(except
that where, for any of the foregoing, a period of grace is specifically
otherwise provided or negated, such specific periods of time or negation shall
govern in each case), MassDevelopment shall have all of the rights and remedies
of a secured party under the Uniform Commercial Code as currently enacted in
the
Commonwealth of Massachusetts (as the same may be amended from time to time,
the
“UCC”), including without limitation the right to enter into and upon the
Premises and any other place where the Collateral may be, and to retake the
same
in order to foreclose upon it in any manner permitted by applicable
law.
(b) In
addition to the foregoing, and in addition to any remedies available to
MassDevelopment under the Note, if there shall be any breach of the conditions
of subsections (i), (j), or (k) of Section 6, the representation in Section
5(b)
or the provisions of Section 7, or if, in any respect other than the filing
of a
Governmental lien, there shall be any breach of any conditions or covenants
of
this Agreement continuing for more than thirty (30) days after the giving of
notice by MassDevelopment or an Event of Default under the Note continuing
beyond any applicable grace periods (except that where, for any of the
foregoing, a period of grace is specifically otherwise provided or negated,
such
specific periods of time or negation shall govern in each case), or if there
occurs any default under any prior or subordinate security interest covering
Borrower’s leasehold interest in the Premises, or under any note or other
obligation secured thereby, which default may result in the acceleration of
the
indebtedness secured thereby, or if there shall occur the commencement of
foreclosure or other enforcement proceedings under any prior or subordinate
security interest covering any other asset of Borrower or Borrower’s leasehold
interest in the Premises, or under any note or other obligation secured thereby,
then MassDevelopment, in addition to, and not in limitation of, any and all
other rights or remedies available to it by law or by any other provision of
any
of the instruments given to secure the Note, shall have the right, during the
continuance of the default beyond any applicable grace period, and without
notice:
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(i) to
enter
upon the Premises and take possession of the Collateral, or any part thereof;
and to perform any acts MassDevelopment shall deem necessary or proper to
conserve the Collateral, to cure any default of the Borrower under the Lease,
and to manage and operate the Collateral, to collect and receive all rents,
revenues, income, issues and profits from the Collateral, past-due and
thereafter accruing, and to exercise all other rights of the Borrower with
respect to the Collateral;
(ii) to
have a
receiver appointed to enter and take possession of the Collateral, or any part
thereof, and to perform any acts said receiver shall deem necessary or proper
to
conserve the Collateral (including, without limitation, the making of repairs,
replacements and alterations), to maintain the Lease in good standing without
uncured defaults, to manage and operate the Collateral, to collect and receive
all rents, revenues, income, issues and profits from the Collateral, past-due
and thereafter accruing, and to exercise all other rights of the Borrower with
respect to the Collateral;
(iii) to
declare the entire indebtedness of the Borrower under the Note forthwith due
and
payable;
(iv) to
sell
the Collateral at public auction on such terms and conditions as MassDevelopment
shall determine, having first given such notice, prior to the sale, of the
time
and place of sale and terms and conditions of sale by publication in one (1)
or
more newspapers having a general circulation in the municipality in which the
Premises, or part thereof, is located, all subject, however, to the requirements
of this Agreement and applicable law; or to foreclose on the Collateral in
any
other manner permitted by law; and
(v) to
obtain
judgment and execution for the indebtedness secured by this Agreement, to the
extent not otherwise satisfied;
(c) If
there
shall be any Event of Default arising out of a breach in any condition or
covenant of this Agreement beyond any applicable grace period, MassDevelopment
shall have the right, but without any obligation so to do, to cure such default
for the account of Borrower, and, to the fullest extent permissible according
to
law, apply any funds credited by or due from MassDevelopment to Borrower against
the same (without any obligation first to enforce any other rights of
MassDevelopment, including, without limitation, any rights under the Note or
this Agreement, or any guarantee thereof, and without prejudice to any such
rights); to pay the premiums for any insurance required hereunder not paid
when
due; to incur and pay reasonable expenses in protecting its rights hereunder
and
the security hereby granted, including, again without limitation, all payments
on account of principal, interest and such other charges as may become due
to
cure default under any subordinate interest, including the notes or obligations
secured thereby, affecting the Collateral; to pay any balance due under any
security agreement on any articles, fixtures and equipment owed by Borrower
included as a part of the Collateral; and the payment of all amounts so incurred
shall be secured hereby as fully and effectually as any other obligation of
Borrower secured hereby; and, to the fullest extent permissible according to
law, to apply to any of these purposes or to the repayment of any amounts so
paid by MassDevelopment of any sums paid on the Note or this Agreement by
Borrower as interest or otherwise.
(d) At
any
foreclosure sale, any combination or all of the Collateral or security given
to
secure the indebtedness secured hereby, may be offered for sale for one total
price, and the proceeds of such sale accounted for in one account without
distinction between the items of security or without assigning to them any
proportion of such proceeds, Borrower hereby waiving the application of any
doctrine of marshalling; and, in case MassDevelopment, in the exercise of the
power of sale herein given, elects to sell in parts or parcels, said sales
may
be held from time to time, and the power shall not be fully executed until
all
of the Collateral not previously sold shall have been sold.
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(e) If
MassDevelopment shall exercise the right described in either subsection (b)(i)
or (b)(ii) of this Section 8, the expenses (including, without limitation,
reasonable receiver's fees and reasonable attorney's fees) incurred pursuant
to
the powers herein contained likewise shall be secured hereby, and
MassDevelopment shall apply such rents, income, issues and profits as shall
be
received by it first to the payment of all costs and expenses incurred and
thereafter to the indebtedness secured hereby in such order of priority as
MassDevelopment, in its sole discretion, shall determine; and the exercise
of
such rights and disposition of such funds shall not constitute a waiver of
any
foreclosure, once commenced, nor preclude the later commencement or foreclosure
for breach hereof.
(f) If
MassDevelopment shall exercise the right described in subsection (b)(iv) of
this
Section 8, MassDevelopment may adjourn, from time to time, any sale by
announcement of such adjournment at the time and place appointed for such sale
or such adjourned sale; and, except as otherwise provided by law,
MassDevelopment may, without further notice or publication, make such sale
at
the time and place to which the same shall be so adjourned. Upon completion
of
any sale, MassDevelopment shall execute and deliver an instrument conveying,
assigning and transferring all right, title and interest in the Collateral,
and
rights sold, in the name of MassDevelopment, or in the name of Borrower, and
the
same shall operate to divest all right, title and interest of Borrower in any
property or right so sold and shall be a perpetual bar, both at law and in
equity, against Borrower and all persons claiming under Borrower unless
MassDevelopment acts with willful neglect, gross negligence or in bad
faith.
(g) The
rights and remedies of MassDevelopment for any default under any of the
instruments given as security for the indebtedness secured hereby are not
mutually exclusive, and may be exercised successively or concurrently and from
time to time for as long as any default exists, and the failure of
MassDevelopment to exercise any such rights in any one or more instances, or
the
acceptance by MassDevelopment of partial payments of amounts in default secured
hereby, shall not constitute a waiver of such default, but such right shall
remain continuously in force; and acceleration of maturity, once claimed hereby
by MassDevelopment, may, at MassDevelopment's option, be rescinded by written
acknowledgment to that effect without waiving the default or any rights,
including the right to accelerate once again, with respect thereto; moreover,
the tender and acceptance of partial payment of amounts in default after
acceleration, or the commencement of any foreclosure action, shall not in any
way affect, rescind or terminate such acceleration of maturity or such
foreclosure action.
(h) If
at any
time any law or court decree prohibits the performance of any material
obligation undertaken hereby by Borrower which would impair MassDevelopment’s
interest in the Collateral or its right to payment under the Note, or, at any
time provides that any amount to be paid hereunder by Borrower, other than
a
payment on account of the principal or of interest on the indebtedness secured
hereby, must be credited against Borrower's obligations under the Note,
MassDevelopment shall have the right on thirty (30) days' prior written notice
to Borrower, to require payment in full of the entire indebtedness secured
hereby unless Borrower reverses such prohibition or otherwise reasonably
satisfies MassDevelopment within said thirty (30) day period.
9. MassDevelopment's
Appointment as Attorney-in-Fact.
(a) Borrower
hereby irrevocably constitutes and appoints MassDevelopment and any officer
or
agent thereof, with full power of substitution, as their true and lawful
attorney-in-fact with full irrevocable power and authority in the place and
stead of Borrower and in the name of Borrower or in its own name, from time
to
time in MassDevelopment's discretion, after the occurrence of and during the
continuance of an Event of Default, for the purpose of carrying out the terms
of
this Agreement, to take any and all appropriate action and to execute any and
all documents and instruments that may be necessary or desirable to accomplish
the purposes of this Agreement and, without limiting the generality of the
foregoing, hereby gives MassDevelopment the power and right, on behalf of
Borrower, without notice to or assent by Borrower, but only after an Event
of
Default has occurred and is continuing as aforesaid, to do the
following:
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(i) to
pay or
discharge taxes or liens levied or placed on or threatened against the
Collateral, to effect any repairs or any insurance called for by the terms
of
this Agreement and to pay all or any part of the premiums therefor and the
costs
thereof; and
(ii) (A)
to
direct any party liable for any payment to Borrower under the Collateral, to
make payment of any and all moneys due and to become due thereunder directly
to
MassDevelopment or as MassDevelopment shall direct; (B) to receive payment
of
and receipt for any and all moneys, claims and other amounts due and to become
due at any time in respect of or arising out of the Collateral; (C) to sign
and
endorse any invoices, freight or express bills, bills of lading, storage or
warehouse receipts, drafts against debtors, assignments, verifications and
notices in connection with the Collateral and other documents relating to the
Collateral; (D) to commence and prosecute any suits, actions or proceedings
at
law or in equity in any court of competent jurisdiction to pursue and protect
MassDevelopment’s interest in the Collateral or any part thereof and to enforce
any other right in respect of the Collateral; (E) to sign Borrower’s name on any
proof of claim against account debtors with respect to the Collateral; (F)
to
defend any suit, action or proceeding brought against Borrower with respect
to
any Collateral; (G) to settle, compromise or adjust any suit, action or
proceeding described above and, in connection therewith, to give such discharges
or releases as MassDevelopment may deem appropriate, all with respect solely
to
the Collateral; (H) to sign Borrower’s name on and file or record any financing
statement necessary to perfect MassDevelopment's interest in the Collateral;
and
(I) otherwise to repair, assemble, complete, alter, supply, use, license, sell,
transfer, pledge, make any agreement with respect to or otherwise deal with
the
Collateral as fully and completely as though MassDevelopment were the absolute
owner thereof for all purposes, and to do, at MassDevelopment's option and
at
Borrower’s expense, at any time or from time to time, all acts and things that
MassDevelopment deems reasonably necessary to protect, preserve or realize
upon
the Collateral and MassDevelopment's security interests therein, in order to
effect the intent of this Agreement, all as fully and effectively as the
Borrower might do.
The
Borrower hereby ratifies all that said attorneys shall lawfully do or cause
to
be done by virtue hereof. This power of attorney is a power coupled with an
interest and shall be irrevocable.
(b) The
powers conferred on MassDevelopment hereunder are solely to protect the
interests of MassDevelopment in the Collateral and shall not impose any duty
upon MassDevelopment to exercise any such powers for the benefit of Borrower
or
any other person. MassDevelopment shall be accountable only for amounts that
it
actually receives as a result of the exercise of such powers, and neither it
nor
any of its officers, directors, employees or agents shall be responsible to
Borrower for any act or failure to act, except for its own willful misconduct
taken or omitted in bad faith.
(c) Any
expenses reasonably incurred by MassDevelopment under this Section shall be
paid
by Borrower on demand and until so paid shall be added to the principal amount
of any Obligations secured hereby and shall bear interest (calculated on the
basis of a 360-day year for the actual days elapsed) at the same rate as
provided in the Loan Documents after maturity or during an Event of Default.
8
10. Miscellaneous.
(a) This
Agreement (i) shall be governed by the internal laws of the Commonwealth of
Massachusetts; (ii) may be amended and any rights or obligations hereunder
may
be waived, only by a writing signed by the party against whom enforcement
thereof is sought; (iii) may be enforced by an action brought in any court
of
competent jurisdiction, including the Massachusetts Superior Court in and for
Suffolk County, to the personal jurisdiction of which court each party hereby
submits, and in any such action each party hereby knowingly and irrevocably
waives the right to trial by jury; and (iv) is intended to provide
MassDevelopment with all rights and remedies of a secured party under the
UCC.
(b) Any
notice, request, instruction or other document to be given hereunder or under
the Note to either party by the other shall be in writing and delivered
personally or sent by recognized overnight courier, receipt confirmed or sent
by
certified or registered mail, postage prepaid, to the addresses set forth in
this Agreement.
[REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK]
9
Executed
under seal this 30th
day of
June, 2008.
BORROWER:
|
MASSDEVELOPMENT:
|
||||
BEACON
POWER CORPORATION
|
MASSACHUSETTS
DEVELOPMENT
|
||||
FINANCE
AGENCY
|
|||||
By:
|
/s/
Xxxxx X. Xxxxxxx
|
By:
|
/s/ Xxxxx X. Xxxxxx
|
||
Name:
Xxxxx X. Xxxxxxx
|
Name:
Xxxxx X. Xxxxxx
|
||||
Title:
Chief Financial Officer
|
Title:
Executive Vice President
|
||||
Hereunto
Duly Authorized
|
Hereunto
Duly Authorized
|
10
Schedule
A - Equipment Collateral
Machinery
and Equipment located at 00 Xxxxxxxxx Xxxx, Xxxxxxxxx,
XX
|
||||||
Date
Acquired
|
Beacon
Asset
Tag
|
Asset
Description
|
Vendor
|
Original
Cost
|
Model
|
Serial
#
|
12/31/07
|
1227
|
Mfg
Bridge Cranes
|
Mass
Crane and Hoist
|
34,981.50
|
5
Ton Cap.
|
070907-2
|
12/31/07
|
1228
|
Mfg
Bridge Cranes
|
Mass
Crane and Hoist
|
34,981.50
|
5
Ton Cap.
|
070907-4
|
12/31/07
|
1229
|
Mfg
Bridge Cranes
|
Mass
Crane and Hoist
|
34,981.50
|
5
Ton Cap.
|
070907-3
|
12/31/07
|
1230
|
Mfg
Bridge Cranes
|
Mass
Crane and Hoist
|
34,981.50
|
5
Ton Cap.
|
070907-1
|
12/31/07
|
1231
|
Assembly
Build Stand Area
|
Various
|
45,921.43
|
N/A
|
N/A
|
12/31/07
|
1232
|
Balance
Pits Tyngsboro Pit #1
|
Mulitple
|
117,934.42
|
N/A
|
N/A
|
12/31/07
|
1233
|
Balance
Pits Tyngsboro Pit #2
|
Mulitple
|
19,336.58
|
N/A
|
N/A
|
12/31/07
|
1234
|
Balance
Pits Tyngsboro Pit #3
|
Mulitple
|
19,336.58
|
N/A
|
N/A
|
03/15/08
|
Untagged
|
Safety
Pit Crane
|
D&W
|
50,000.00
|
7
Ton Cap.
|
122007
|
03/31/08
|
Untagged
|
Safety
rails and ladders for all 4 Pits
|
D&W
|
27,576.00
|
N/A
|
N/A
|
03/31/07
|
1052
|
Lambda
Power Supply - Model 303L-2.5KV-POS-DC
|
Airak
Inc
|
15,604.29
|
303L-2.5KV-POS-DC
|
22M8019
|
06/30/07
|
1097
|
Chiller
|
Lytron
|
5,838.00
|
RC045J03BG2M007
|
773965-01
|
06/30/07
|
1100
|
Scissor
Lift - Skyjack 3219
|
United
Rental Equipment
|
11,970.00
|
SJ111-3219
|
22000350
|
06/30/07
|
1098
|
36000#
Fork Truck
|
Nitco
|
163,552.20
|
T360L
|
SBG34155
|
08/31/07
|
LIC
|
Upgrade
to 2006-10 Dynamic sampler card for CAR 2006-10
|
Bentley
Nevada
|
17,608.00
|
168905-02
|
N/A
|
09/30/07
|
1362
|
Safety
pit in Wilmington - Will move to Xxxxxxxxx- Xxx #0
|
designed
by Beacon
|
129,206.62
|
N/A
|
N/A
|
12/31/07
|
1123
|
Positioner
Table
|
Xxxxxxxxx
|
57,510.01
|
WP003864
|
648
|
11
01/31/08
|
1218
|
Fluke
434 Power Analyzer
|
Newark
InOne
|
4,995.00
|
434/003
|
DM92400624
|
01/31/08
|
1213
|
Vacuum
Sweeping
|
The
Xxxxxx Company
|
5,244.75
|
EAG-TKS510ET
|
265504
|
01/31/08
|
1214
|
Squeegie
Machine for floor
|
The
Xxxxxx Company
|
5,909.49
|
CT70
|
N/A
|
01/31/08
|
1215
|
Color
Scanner goes with Tag 0000
|
XXX
Xxxxx Xxxxxxx Inc.
|
7,659.75
|
TC4
|
8373
|
01/31/08
|
1219
|
Thermal
Image Camera
|
Fotronic
Corporation
|
12,594.75
|
FLKT140FT-20
|
T140FT-0712038
|
01/31/08
|
1217
|
Loop
Analyzer
|
Xxxxxxx
Industries
|
17,655.00
|
3120
|
7063249
|
01/31/08
|
1212
|
Color
Plotter goes with Scanner tag 0000
|
XXX
Xxxxx Xxxxxxx Inc.
|
24,682.00
|
TC5500
|
5400
|
03/14/08
|
1241
|
Large
Floor Sweeper
|
NITCO
|
26,256.75
|
Condor
403OC-AXP
|
2038377
|
03/31/08
|
Untagged
|
Fire
Suppresstion System
|
D&W
|
4,620.00
|
N/A
|
N/A
|
04/15/08
|
1247
|
Balance
Machine
|
Xxxxxxx
|
101,396.09
|
PCH-25.1
|
84401
|
04/25/08
|
1245
|
Oven
|
XX
Xxxx Machining
|
22,759.00
|
13913
|
8389AO605
|
04/30/08
|
1243/1294
|
Xerox
Copier
|
Xxxxxx
Office Products
|
17,787.00
|
Workstation
7345/5638
|
E153709/FKA625358
|
12/31/07
|
1226
|
Nortel
BCM 400 Phone System
|
Boston
Wireless
|
28,697.33
|
508AA36
|
FOB671100000
|
03/01/08
|
Untagged
|
Phone
- Phase 2
|
Boston
Wireless
|
7,881.41
|
||
08/31/07
|
1140
|
Dell
Precision 690 Work station
|
Dell
|
5,228.68
|
PWS690
|
G4LFDDT
|
08/31/07
|
1141
|
Dell
Precision 690 Work station
|
Dell
|
5,228.68
|
PWS690
|
DC00
|
03/01/08
|
Untagged
|
Tyngsboro
Network
|
Microdots
Computer Services
|
10,000.00
|
||
03/01/08
|
Untagged
|
Wireless
Network Equipment
|
PC
Connection
|
12,379.42
|
||
03/01/08
|
Untagged
|
Network
Switch Gear
|
PC
Connection
|
28,920.64
|
||
03/01/08
|
Untagged
|
Network
Security
|
PC
Connection
|
5,643.11
|
12
03/14/08
|
1242
|
Projector
in Boardroom
|
HB
Communications
|
8,616.50
|
LVP-XD1000U
|
|
1/24/2008
|
Untagged
|
IP
Phone Expansion (3 sets)
|
Boston
Wireless
|
16,046.50
|
||
Total
|
1,201,521.98
|
|||||
13