EXHIBIT 10.15
SECURITY AGREEMENT
THIS SECURITY AGREEMENT (this "Agreement") is dated as of August 24,
2005, by BRIDGE ONCOLOGY PRODUCTS, INC., a Delaware corporation (the "Grantor"),
in favor of SCO CAPITAL PARTNERS LLC, a Delaware limited liability company (the
"Lender").
Recitals
WHEREAS, pursuant to that certain letter agreement (the "Letter
Agreement") of even date herewith between the Grantor and Lender, Lender has
made available a secured loan in the principal amount of One Million Dollars
($1,000,000);
WHEREAS, pursuant to that certain secured convertible promissory note
of even date herewith, issued by the Grantor in favor of the Lender (as the same
may from time to time be amended, modified, supplemented or restated, the
"Note"), Grantor has promised to pay the Obligations (as defined herein) to the
Lender; and
WHEREAS, the obligations of the Lender under the Letter Agreement are
subject to the condition, among others, that Grantor shall have executed and
delivered to Lender this Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by Grantor, Grantor hereby
represents, covenants and agrees with Lender as follows:
1. Definitions.
a. When used in this Agreement the following terms shall have the
following meanings (such meanings being equally applicable to
both the singular and plural forms of the terms defined):
"Collateral" has the meaning assigned to such term in Section 2 of this
Agreement.
"Contracts" means all contracts (including any customer, vendor,
supplier, service or maintenance contract), leases, licenses,
undertakings, purchase orders, permits, franchise agreements or other
agreements (other than any right evidenced by Chattel Paper, Documents
or Instruments), whether in written or electronic form, in or under
which Grantor now holds or hereafter acquires any right, title or
interest, including, without limitation, with respect to an Account,
any agreement relating to the terms of payment or the terms of
performance thereof.
"Copyrights" means all of the following now owned or hereafter acquired
or created (as a work for hire for the benefit of Grantor) by Grantor
or in which Grantor now holds or hereafter acquires or receives any
right or interest, in whole or in part: (a) all copyrights, whether
registered or unregistered, held pursuant to the laws of the United
States, any State thereof or any other country; (b) registrations,
applications, recordings and proceedings in the United States Copyright
Office or in any similar office or agency of the United States, any
State thereof or any other country; (c) any continuations, renewals or
extensions thereof; (d) any registrations to be issued in any pending
applications, and shall include any right or interest in and to work
protectable by any of the foregoing which are presently or in the
future owned, created or authorized (as a work for hire for the benefit
of Grantor) or acquired by Grantor, in whole or in part; (e) prior
versions of works covered by copyright and all works based upon,
derived from or incorporating such works; (f) income, royalties,
damages, claims and payments now and hereafter due and/or payable with
respect to copyrights, including, without limitation, damages, claims
and recoveries for past, present or future infringement; (g) rights to
xxx for past, present and future infringements of any copyright; and
(h) any other rights corresponding to any of the foregoing rights
throughout the world.
"Obligations" has the meaning set forth in Section 3 of this Agreement.
"Patents" means all of the following in which Grantor now holds or
hereafter acquires any interest: (a) all letters patent of the United
States or any other country, all registrations and recordings thereof
and all applications for letters patent of the United States or any
other country, including, without limitation, 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; (b) all reissues, divisions, continuations,
renewals, continuations-in-part or extensions thereof; (c) all xxxxx
patents, divisionals and patents of addition; (d) all patents to issue
in any such applications; (e) income, royalties, damages, claims and
payments now and hereafter due and/or payable with respect to patents,
including, without limitation, damages, claims and recoveries for past,
present or future infringement; and (f) rights to xxx for past, present
and future infringements of any patent.
"Trademark" means any of the following in which Grantor now holds or
hereafter acquires any interest: (a) all trademarks, whether registered
or unregistered, held pursuant to the laws of the United States, and
State thereof, or any country (b) registrations, applications,
recordings and proceedings 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; (c) any continuations, renewals or
extensions thereof; (d) any registrations to be issued in any pending
applications (e) income, royalties, damages, claims and payments now
and hereafter due and/or payable with respect to trademarks, including,
without limitation, damages, claims and recoveries for past, present or
future infringement; (g) rights to xxx for past, present and future
infringements of any trademark; and (h) any other rights corresponding
to any of the foregoing rights throughout the world.
"UCC" means the Uniform Commercial Code as the same may from time to
time be in effect in the State of New York; provided, however, in the
event that, by reason of mandatory provisions of law, any or all of the
attachment, perfection or priority of Lender's security interest in any
Collateral is governed by the Uniform Commercial Code as in effect in a
jurisdiction other than the State of New York, the term "UCC" shall
mean the Uniform Commercial Code (including the Articles thereof) as in
effect at such time in such other jurisdiction for purposes of the
2
provisions hereof relating to such attachment, perfection or priority
and for purposes of definitions related to such provisions. In
addition, the following terms shall have the meanings set forth for
such terms in the UCC: "Account," "Account Debtor," "Chattel Paper"
(including tangible and electronic chattel paper), "Commercial Tort
Claims," "Commodity Account," "Deposit Account," "Documents,"
"Equipment," "Financial Assets", "Fixtures," "Fixture Filing," "General
Intangible" (including, without limitation, Payment Intangibles,
Copyrights, Patents, Trademarks, designs, drawings, technical
information, marketing plans, customer lists, trade secrets,
proprietary or confidential information, inventions (whether or not
patentable), procedures, know-how, models and data), "Instrument,"
"Intellectual Property," "Inventory" (including all goods held for sale
or lease or to be furnished under a contract of service, and including
returns and repossessions), "Investment Property" (including Financial
Assets, Securities, Securities Accounts and Securities entitlements),
"Letter-of-Credit Right" (whether or not the letter of credit is
evidenced by a writing), "Payment Intangibles," "Proceeds," "Promissory
Notes," "Securities," "Securities Account," "Securities Entitlement"
and "Supporting Obligations." Each of the foregoing terms shall include
all of such items now owned, or hereafter acquired, by Grantor.
b. Except as otherwise defined herein, all capitalized terms used
in this Agreement have the respective meanings given thereto
in the Note.
2. Grant of Security. As collateral security for the full, prompt,
complete and final payment and performance when due (whether at stated
maturity, by acceleration or otherwise) of all the Obligations, Grantor
hereby grants to Lender a lien on and security interest in, all of
Grantor's right, title and interest in, to and under the following,
whether now owned or hereafter acquired (all of which being
collectively referred to herein as the "Collateral"); provided that the
Collateral shall not include any of Grantor's rights to the BrE3 and
Mc3 cell lines to the extent that Grantor has granted a security
interest to Immunodex, Inc. or its successor covering such cell lines
solely in connection with that certain license agreement dated as of [
], 2005, between Immunodex, Inc. and Somanta Limited:
a. All Accounts of Grantor (including, but not limited to, and
notwithstanding anything in this Agreement to the contrary,
any and all proceeds, money or accounts under all Contracts
(without exception);
b. All Chattel Paper of Grantor;
c. All Contracts of Grantor;
d. All Deposit Accounts of Grantor;
e. All Documents of Grantor;
f. All Equipment of Grantor;
g. All Fixtures of Grantor;
3
h. All General Intangibles of Grantor;
i. All Instruments of Grantor, including, without limitation,
Promissory Notes;
j. All Inventory of Grantor;
k. All Investment Property of Grantor;
l. All Letter-of Credit Rights of Grantor;
m. All Supporting Obligations of Grantor;
n. All property of Grantor held by Lender, including, without
limitation, all property of every description now or hereafter
in the possession or custody of or in transit to Lender for
any purpose, including, without limitation, safekeeping,
collection or pledge, for the account of Grantor, or as to
which Grantor may have any right or power;
o. All other goods and personal property of Grantor wherever
located, whether tangible or intangible, and whether now owned
or hereafter acquired, existing, leased or consigned by or to
Grantor; and
p. To the extent not otherwise included, all Proceeds of each of
the foregoing and all accessions to, substitutions and
replacements for and rents, profits and products of each of
the foregoing.
If Grantor shall at any time acquire a Commercial Tort Claim, Grantor
shall promptly notify the Lender in a writing signed by Grantor of the
brief details thereof and grant to Lender in such writing a security
interest therein and in the proceeds thereof, all upon the terms of
this Agreement, with such writing to be in form and substance
reasonably satisfactory to the Lender.
Grantor hereby authorizes the Lender to file, without Grantor's
signature thereon and at Grantor's expense, financing statements,
continuation statements (including "in lieu" continuation statements)
and amendments thereto, that describe the Collateral and which contain
any other information required by Part 5 of Article 9 of the UCC for
the sufficiency or filing office acceptance of any financing statement,
continuation statement or amendment, including if Grantor is an
organization, the type of organization and any organization
identification number issued to Grantor.
3. Security for Obligations. This Agreement secures the payment of (i) all
of the unpaid principal amount of, and accrued interest on (including
any interest that accrues after the commencement of any bankruptcy
proceeding) the Note, (ii) the obligation of Grantor to pay any fees,
costs and expenses of Lender under the Note, and (iii) all other
obligations, liabilities and indebtedness owed by Grantor to the Lender
under the Note and the Transaction Documents, in each case, whether now
existing or hereafter incurred (collectively, the "Obligations").
4
4. Rights of Lender; Collection of Accounts.
a. Grantor expressly agrees that Grantor shall remain liable
under each of its Contracts to observe and perform all the
conditions and obligations to be observed and performed by it
thereunder and that Grantor shall perform all of its duties
and obligations thereunder such that the Grantor shall not be
deemed to be in breach of each such Contract. The Lender shall
not have any obligation or liability under any Contract by
reason of or arising out of this Agreement or the granting to
the Lender of a lien therein or the receipt by the Lender of
any payment relating to any Contract pursuant hereto, nor
shall the Lender be required or obligated in any manner to
perform or fulfill any of the obligations of Grantor under or
pursuant to any Contract, or to make any payment, or to make
any inquiry as to the nature or the sufficiency of any payment
received by them or the sufficiency of any performance by any
party under any Contract, or to present or file any claim, or
to take any action to collect or enforce any performance or
the payment of any amounts which may have been assigned to
them or to which they may be entitled at any time or times.
b. The Lender authorizes Grantor to collect its accounts,
provided that such collection is performed in a prudent and
businesslike manner, and the Lender may, upon the occurrence
and during the continuation of any Event of Default and
without notice, limit or terminate said authority at any time.
Upon the occurrence and during the continuance of any Event of
Default, at the request of the Lender, Grantor shall deliver
to Lender all original and other documents which created
and/or relate to such accounts, including, without limitation,
all original orders, invoices and shipping receipts.
c. The Lender may at any time, upon the occurrence and during the
continuance of any Event of Default, without notifying Grantor
of its intention to do so, notify Account Debtors of Grantor,
parties to the Contracts of Grantor, obligors in respect of
Instruments of Grantor and obligors in respect of Chattel
Paper of Grantor that the Accounts and the right, title and
interest of Grantor in, to and under such Contracts,
Instruments and Chattel Paper have been assigned to Lender and
that payments thereunder or with respect thereto are to be
made directly to the Lender. Upon the request of the Lender,
Grantor shall promptly so notify such Account Debtors, parties
to such Contracts, obligors in respect of such Instruments and
obligors in respect of such Chattel Paper. Upon the occurrence
and during the continuance of any Event of Default, the Lender
may, in Lender's name or in the name of others, communicate
with such Account Debtors, parties to such Contracts, obligors
in respect of such Instruments and obligors in respect of such
Chattel Paper to verify with such parties, to the Lender's
satisfaction, the existence, amount and terms of any such
Accounts, Contracts, Instruments or Chattel Paper.
Notwithstanding the foregoing, Lender shall not notify or
otherwise communicate with any parties to Contracts or Account
Debtors of Grantor except upon the occurrence of any Event of
Default.
5
d. Without limiting the foregoing and Lender's rights as set
forth in the foregoing, any action by the Lender pursuant to
or as described in Section 4(b) or Section 4(c) hereof shall
be in compliance with the provisions set forth in Section
12(b)(v) hereof.
5. Representations and Warranties of Grantor. Grantor represents and
warrants as follows:
a. Grantor is a corporation duly organized, existing and in good
standing under the laws of the Delaware, (b) has the legal
power to own its property and to carry on its business as now
being conducted, and (c) is duly qualified to do business and
is in good standing in each jurisdiction in which the
character of the properties owned or leased by it therein or
in which the transaction of its business makes such
qualification necessary, except where the failure to so
qualify or be in good standing would not have a Material
Adverse Effect;
b. Grantor is, and as to Collateral acquired by it from time to
time after the date hereof Grantor will be, the owner of all
Collateral free from any liens, other than liens created
hereby and other than Permitted Liens;
c. This Agreement creates, for the benefit and security of Lender
in respect of the Obligations, a legally valid and binding
lien on, pledge of, and security interest in the Collateral
and, upon the filing of a UCC Financing Statement, and any
applicable filings with respect to Copyrights, Patents or
Trademarks in respect of the Collateral, such lien, pledge and
security interest will be perfected and will have priority
over the claims of any other present and future creditors of
the Company (other than Permitted Liens or liens upon such of
the Collateral that must be perfected by possession or control
of such Collateral); and
d. Grantor's chief executive office, principal place of business
and the place where Grantor maintains its records concerning
the Collateral are each presently located at the address set
forth on the signature page hereof; and Grantor's Federal
taxpayer identification number and Grantor's organizational
identification number under the laws of the State in which
Grantor, as a registered organization, was organized are as
set forth on the signature page hereto.
6. As to the Collateral.
a. Notwithstanding anything to the contrary contained herein, the
assignment by Grantor herein stated is intended to be an
assignment for security purposes and is not intended to divest
Grantor of its ownership of the Collateral, except as
otherwise provided herein.
b. So long as no Event of Default has occurred and is continuing,
(i) Grantor shall retain title to and record ownership of the
Collateral, and (ii) Grantor shall be entitled to receive any
and all income or distributions made with respect to the
Collateral, except as provided in Section 6(c) hereof.
6
c. Upon the occurrence and during the continuance of an Event of
Default, all income and proceeds of the Collateral which are
received by Grantor shall be (i) received in trust for the
benefit of the Lender, (ii) segregated from other funds of
Grantor, and (iii) forthwith paid over by Grantor to the
Lender (for application in accordance with this Agreement) in
the same form as so received.
7. Covenants of Grantor. Grantor covenants and agrees with Lender that
unless approved by Lender:
a. Grantor shall not sell, assign (by operation of law or
otherwise), or otherwise transfer any of the Collateral, or
attempt or contract to do so, or grant any option with respect
to any of the Collateral, except Inventory in the ordinary
course of business.
b. Other than as expressly set forth in the Share Exchange
Agreement (as such term is defined in the Letter Agreement),
Grantor shall not change its name, identity or corporate
structure in any manner, nor change its jurisdiction of
organization, relocate its chief executive office, principal
place of business or its principal records with respect to the
Collateral, or allow the relocation of any Collateral, in each
case without thirty (30) days' prior written notice to the
Lender.
c. Grantor shall not, directly or indirectly, create or permit to
exist any lien upon or with respect to any of the Collateral,
and shall defend the Collateral against, and take such other
action as is necessary to remove, any lien on the Collateral,
except for the lien created hereby and any Permitted Liens.
d. Grantor shall maintain all tangible Collateral in good
condition and repair, ordinary wear and tear excepted.
e. Grantor shall maintain on the Collateral property damage and
liability insurance in such amounts, against such risks, and
in such forms and with such companies as are customarily
maintained by businesses similar to Grantor. Each such policy
shall not be materially altered or canceled, and the coverage
will not be materially reduced, in any case, without at least
thirty (30) days' prior written notice to the Lender. Grantor
shall provide the Lender with satisfactory evidence of such
insurance coverage at the request of the Lender.
f. Grantor shall promptly pay when due all property and other
taxes, assessments and government charges or levies imposed
upon, and all claims (including claims for labor, materials
and supplies) against, the Collateral, except to the extent
the validity thereof is being contested in good faith and by
appropriate proceedings and adequate reserves are being
maintained in connection therewith; provided that this Section
7(f) shall not apply to claims for labor, materials or
supplies which Payee consents in writing shall be excluded
herewith, notwithstanding that such claims, if unpaid, might
become a lien or charge upon such properties or any part
thereof.
7
g. Grantor shall keep and maintain at its own cost and expense
satisfactory and reasonably complete records of the
Collateral. Grantor shall furnish the Lender with such
information regarding the Collateral as the Lender may
reasonably request from time to time and shall allow the
Lender, upon reasonable notice, access during normal business
hours to inspect the Collateral and Grantor's records,
accounts and books pertaining to the Collateral, provided that
no restriction as to normal business hours shall be required
during the continuance of an Event of Default.
h. Grantor shall not knowingly take or omit to take any action,
the taking or omission of which might impair Lender's lien on
the Collateral or adversely affect the value of the
Collateral.
i. Upon the occurrence and during the continuance of any Event of
Default, Grantor shall not grant any extension of the time of
payment of any of its Accounts, Chattel Paper, Instruments or
amounts due under any of its Contracts or Documents,
compromise, compound or settle the same for less than the full
amount thereof, release, wholly or partly, any Person liable
for the payment thereof, or allow any credit or discount
whatsoever thereon other than trade discounts and rebates
granted in the ordinary course of Grantor's business.
j. Grantor shall (i) protect, defend and maintain the validity
and enforceability of the Copyrights, Patents and Trademarks,
(ii) use commercially reasonable efforts to detect
infringements of the Copyrights, Patents and Trademarks and
promptly advise the Lender in writing of material
infringements detected, and (iii) not allow any material
Copyrights, Patents or Trademarks to be abandoned, forfeited
or dedicated to the public without the written consent of the
Lender, unless any such abandonment is appropriate in
accordance with reasonable and customary business practice.
k. Grantor shall not execute or authorize to be filed in any
public office any UCC financing statement (or similar
statement or instrument of registration under the law of any
jurisdiction) except UCC financing statements filed or to be
filed in respect of and covering the lien created by this
Agreement.
8. Further Assurances. Grantor agrees, at any time and from time to time,
at the expense of Grantor, and upon request of the Lender, to promptly
execute and deliver all further instruments and documents, and take all
further action, that may be necessary or desirable, in order to perfect
and protect any security interest granted or purported to be granted
hereby or to enable the Lender to exercise and enforce Lender's rights
and remedies hereunder with respect to any Collateral, including,
without limitation, (i) delivering and causing to be filed any
financing or continuation statements (including "in lieu" continuation
statements) under the UCC with respect to the security interests
granted hereby, (ii) obtaining "control" by or on behalf of Lender of
any Investment Property, Deposit Accounts, Letter-of-Credit Rights or
Electronic Chattel Paper (with reference to applicable provisions of
the UCC with respect to "control" for such items of Collateral), (iii)
placing the interest of the Lender as lienholders on the certificate of
title (or similar evidence of ownership) of any Equipment constituting
8
Collateral owned by Grantor which is covered by a certificate of title
(or similar evidence of ownership), (iv) filing or cooperating with the
Lender in filing any forms or other documents required to be recorded
with the United States Patent and Trademark Office, United States
Copyright Office, or any actions, filings, recordings or registrations
in any foreign jurisdiction or under any international treaty, required
to secure or protect Lender's interest in the Collateral, (v)
transferring Collateral to the possession of the Lender (if a security
interest in such Collateral can only be perfected by possession), (vi)
executing and delivering or causing to be delivered written notice to
insurers of Lender's security interest in, or claim in or under, any
policy of insurance (including unearned premiums), and (vii) using its
best efforts to obtain acknowledgements from bailees having possession
of any Collateral and waivers of liens from landlords and mortgagees of
any location where any of the Collateral may from time to time be
stored or located. If Grantor executes and delivers any document or
instrument pursuant to this Section 8, such document or instrument
shall be in form and substance reasonably satisfactory to the Lender
and a copy thereof shall be provided by Grantor to the Lender; and if
Grantor takes any other action pursuant to this Section 8, such action
shall be taken with the prior written consent of the Lender and notice
thereof shall be given by Grantor to the Lender.
9. Security Interest Absolute. All rights of the Lender and the assignment
and security interest hereunder, and all obligations of Grantor
hereunder, shall remain in full force and effect and shall secure the
Obligations, and shall be absolute and unconditional, irrespective of:
a. 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 Note; or
b. any taking, exchange, release or non-perfection of any other
collateral, or any release or amendment or waiver of or
consent to departure from any guaranty, for all or any of the
Obligations; or
c. any manner of application of any Collateral, or proceeds
thereof, to all or any of the Obligations or any manner of
sale or other disposition of any Collateral; or
d. any other circumstances other than releases, waivers and the
like by the Lender that might otherwise constitute a defense
available to, or a discharge of, Grantor's obligations
hereunder or Lender's security interest hereunder.
10. Continuing Security Interest; Sale of Participations; Release of
Collateral. This Agreement shall create a continuing security interest
in the Collateral and shall (i) remain in full force and effect until
the payment in full of the Obligations (subject to Section 14 hereof),
(ii) be binding upon Grantor, its successors and its permitted assigns
under the Note, and (iii) inure to the benefit of, and be enforceable
by (subject to the terms hereof), the Lender and its successors and
assigns. No sales of participations in, and no other sales,
assignments, transfers or other dispositions of, any agreement
governing or instrument evidencing the Obligations or any portion
thereof or interest therein by the Lender shall in any manner affect
9
the lien granted to the Lender hereunder. Subject to Section 14 hereof,
upon the payment in full of the Obligations, the security interest
granted hereby shall terminate and all rights to the Collateral shall
revert to Grantor. Upon any such termination, the Lender will, at
Grantor' expense, execute and deliver to Grantor such documents as
Grantor shall reasonably request to evidence such termination. The
Lender shall, at the request of Grantor, deliver any document
reasonably necessary to release any lien granted hereunder with respect
to any Collateral Grantor is transferring.
11. Lender's Duties. The powers conferred on the Lender hereunder are
solely to protect Lender's interest in the Collateral as a secured
party and shall not impose any duty upon the Lender to exercise any
such powers. Except for the safe custody of any Collateral in Lender's
possession and the accounting for money actually received by Lender
hereunder, the Lender shall not have any duty as to any Collateral or
as to the taking of any necessary steps to preserve any rights
pertaining to any Collateral. The Lender shall not have any
responsibility or liability for the collection of any proceeds of any
Collateral or by reason of any invalidity, lack of value or
uncollectability of any of the Collateral. The Lender shall be deemed
to have exercised reasonable care in the custody and preservation of
any Collateral in the Lender's possession if such Collateral is
accorded treatment substantially equal to that which the Lender accords
its own property.
12. Events of Default; Remedies Upon Default; Actions by Lender.
a. The occurrence of an Event of Default under and as defined in
the Note shall constitute an "Event of Default" hereunder.
b. If any Event of Default shall have occurred:
i. The Lender may exercise in respect of the Collateral,
in addition to other rights and remedies provided for
herein or otherwise available to Lender (or any of
them), all the rights and remedies of a secured party
on default under the UCC (whether or not the UCC
applies to the affected Collateral), and may also,
without notice of any kind or demand of performance
or other demand (all and each of which demands and
notices are hereby expressly waived to the maximum
extent provided by the UCC and other applicable law)
reclaim, take possession, recover, store, maintain,
finish, repair, prepare for sale or lease, advertise
for sale or lease and sell the Collateral or any part
thereof in one or more parcels at public or private
sale, at any exchange, broker's board or at the
Lender's offices or elsewhere, for cash, on credit,
or for future delivery, and upon such other terms as
the Lender may deem commercially reasonable. In
connection with the liquidation, sale or other
disposition of the Collateral, the Lender is granted
a non-exclusive, royalty-free license or other right
to use, without charge, Grantor' labels, patents,
copyrights, trade secrets, trade names, trademarks,
service marks, or any similar property as it pertains
to the Collateral, in completing a liquidation, sale
or other disposition of the Collateral. The Lender
shall not be obligated to make any sale of Collateral
10
regardless of notice of sale having been given. The
Lender may adjourn any public or private sale from
time to time by announcement at the time and place
fixed therefor, and such sale may, without further
notice, be made at the time and place to which it was
so adjourned. Grantor agrees that in any sale of any
of the Collateral, whether at a foreclosure sale or
otherwise, the Lender is hereby authorized to comply
with any limitation or restriction in connection with
such sale as it may be advised by counsel is
necessary in order to avoid any violation of
applicable law (including compliance with such
procedures as may restrict the number of prospective
bidders and the Lender, require that such prospective
bidders and the Lender have certain qualifications
and restrict such prospective bidders and the Lender
to Persons who will represent and agree that they are
purchasing for their own account for investment and
not with a view to the distribution or resale of such
Collateral), and Grantor further agrees that such
compliance shall not result in such sale being
considered or deemed not to have been made in a
commercially reasonable manner, nor shall the Lender
be liable or accountable to Grantor for any discount
allowed by reason of the fact that such Collateral is
sold in compliance with any such limitation or
restriction.
ii. Grantor authorizes the Lender, on the terms set forth
herein, to enter the premises where the Collateral
(or any part of it) is located, to take possession of
the Collateral (or any part of it), and to pay,
purchase, contract, or compromise any encumbrance,
charge or lien which, in the opinion of the Lender,
appears to be prior or superior to its security
interest. Grantor further agrees, at the Lender's
request, to assemble the Collateral and make it
available to the Lender at places which the Lender
shall reasonably select. To the maximum extent
permitted by applicable law, Grantor hereby waives
all claims, damages, and demands against the Lender
arising out of the repossession, retention or sale of
the Collateral.
iii. The Lender may sell Collateral without giving
warranties as to such Collateral. The Lender may
specifically disclaim any warranties of title or the
like. The foregoing will not be considered adversely
to affect the commercial reasonableness of any sale
of Collateral.
iv. If the Lender sells any of the Collateral upon
credit, Grantor will be credited only with, and at
the time of, payments actually made by the purchaser
in such sale received by the purchaser and applied to
the indebtedness of such purchaser. In the event the
purchaser in such sale fails to pay for the
Collateral, the Lender may resell the Collateral and
Grantor shall be credited with the proceeds of the
resale in accordance with the preceding sentence. In
the event the Lender purchases any of the Collateral
being sold, the Lender may pay for the Collateral by
crediting some or all of the amounts described in
clauses first and second of Section 12(b)(v) hereof.
11
v. Any cash held by the Lender as Collateral and all
cash proceeds received by the Lender in respect of
any sale of, collection from, or other realization
upon, all or any part of the Collateral or the
exercise of any other remedies consequent upon an
Event of Default shall be applied in whole or in part
by the Lender against all or any part of the
Obligations in the following order:
First, to the Lender in an amount sufficient to pay
in full the Obligations, including all reasonable
fees, costs, expenses, liabilities and advances
incurred or made by the Lender in connection with the
sale, disposition or other realization of the
Collateral, including without limitation, reasonable
attorneys' fees;
Second, upon payment in full of all the Obligations,
to Grantor or to whomsoever may be lawfully entitled
to receive such surplus.
vi. Grantor shall remain liable for any deficiency if the
proceeds of any sale or disposition of the Collateral
are insufficient to fully pay the Obligations, and
Grantor also shall be liable for the reasonable costs
and expenses (including reasonable attorneys' fees
and expenses) incurred by Lender to collect such
deficiency.
vii. Grantor hereby waives presentment, demand, protest or
any notice (to the maximum extent permitted by
applicable law) of any kind in connection with this
Agreement or any Collateral.
13. Expenses. Grantor shall upon demand pay to the Lender the amount of any
and all reasonable expenses, including the reasonable and necessary
fees and expenses the Lender's counsel and of any experts and agents,
which the Lender may incur in connection with (a) the administration of
this Agreement, (b) the custody or preservation of, or the sale of,
collection from, or other realization upon, any of the Collateral, (c)
the exercise or enforcement of any of the rights of the Lender
hereunder, or (d) the failure by Grantor to perform or observe any of
the provisions hereof or of under the Note.
14. Reinstatement. This Agreement shall remain in full force and effect and
continue to be effective should any petition be filed by or against
Grantor for liquidation or reorganization, should Grantor become
insolvent or make an assignment for the benefit of creditors or should
a receiver or trustee be appointed for all or any significant part of
Grantor's property and assets, and shall continue to be effective or be
reinstated, as the case may be, if at any time payment and performance
of the Obligations, or any part thereof, is, pursuant to applicable
law, rescinded or reduced in amount, or must otherwise be restored or
returned by any obligee of the Obligations, whether as a "voidable
preference," "fraudulent conveyance," or otherwise, all as though such
payment or performance had not been made. In the event that any
payment, or any part thereof, is rescinded, reduced, restored or
returned, the Obligations shall be reinstated and deemed reduced only
by such amount paid and not so rescinded, reduced, restored or
returned.
12
15. Amendments, Etc. No amendment or waiver of any provision of this
Agreement, nor consent to any departure by Grantor herefrom, shall in
any event be effective unless the same shall be in writing and signed
by the parties necessary to amend the Note, and then such waiver or
consent shall be effective only in the specific instance and for the
specific purpose for which given.
16. Cumulative Remedies. The rights and remedies hereunder provided are
cumulative and may be exercised singly or concurrently, and are not
exclusive of any rights and remedies provided by law. The Lender shall
not by any act, delay, omission or otherwise be deemed to have waived
any of their respective rights or remedies hereunder, nor shall any
single or partial exercise of any right or remedy hereunder on any one
occasion preclude the further exercise thereof or the exercise of any
other right or remedy.
17. Lender May Perform; Reimbursement; Power of Attorney.
a. If Grantor fails to perform any obligation of Grantor under
this Agreement, the Lender may, but shall not have the
obligation to, without prior notice to or obtaining the
consent of Grantor, perform that obligation on behalf of
Grantor, including, without limitation, obtaining insurance
coverage for the Collateral and satisfying tax obligations or
liens on the Collateral. Grantor shall reimburse the Lender on
demand for all reasonable expenses and reasonable attorneys'
fees incurred by the Lender in performing any such obligation,
including interest at the interest rate specified in the Note.
b. Grantor hereby absolutely and irrevocably constitutes and
appoints the Lender as Grantor's true and lawful agent and
attorney-in-fact, with full power of substitution, in the name
of Grantor: (a) to take any and all such action as the Lender
or any of its agents, nominees or attorneys may, in its or
their sole and absolute discretion, reasonably determine as
necessary or advisable for the purpose of maintaining,
preserving or protecting the security constituted by this
Agreement or any of the rights, remedies, powers or privileges
of the Lender under this Agreement; and (b) generally, in the
name of Grantor to exercise all or any of the powers,
authorities and discretions, conferred on or reserved to the
Lender by or pursuant to this Agreement, and (without
prejudice to the generality of any of the foregoing) to seal
and deliver or otherwise perfect any deed, assurance,
agreement, instrument or act as the Lender may deem proper in
or for the purpose of exercising any of such powers,
authorities or discretions, in each case. Grantor hereby
ratifies and confirms, and hereby agrees to ratify and
confirm, whatever lawful acts the Lender or any of its agents,
nominees or attorneys shall do or purport to do in the
exercise of the power of attorney granted to the Lender
pursuant to this Section 17(b), which power of attorney, being
given for security, is irrevocable. Notwithstanding anything
to the contrary in this Section 17(b), no such action as
Grantor's true and lawful agent and attorney-in-fact may be
taken by Lender except upon the occurrence of any Event of
Default.
18. Addresses for Notices. All notices and other communications to any
party provided for hereunder shall be in writing and mailed by
registered or certified mail, return receipt requested, to the
13
addresses for the Grantor and the Lender set forth on the signature
pages hereto, or, as to any party, to such other address as shall be
designated by such party in a written notice to each other party
complying as to delivery with the terms of this Section 18. A copy of
each notice to Grantor shall also be sent to Xxxxx & Xxxxxxx LLP, 000
X. Xxxxxxxx, 00xx Xxxxx, Xxx Xxxxx, XX 00000, Attn: Xxxxxxx X. Xxxxx,
Esq. A copy of each notice to Lender shall also be sent to Xxxxxx and
Xxxx LLP, 000 Xxxxxxxxx Xxxxxx, Xxxxx 0000, Xxx Xxxx, XX 00000,
Attention: Xxxxxxxxxxx X. Xxxxxxxx, Esq. All such notices and other
communications shall be effective (i) upon personal delivery to the
party to be notified; (ii) on the date of first attempted delivery
after having been sent by registered or certified mail, return receipt
requested, postage prepaid; (iii) one (1) day after deposit with a
nationally recognized overnight courier, specifying next day delivery,
with written verification of receipt.
19. Forbearance; Delay. Any forbearance, failure or delay by the Lender in
exercising any right, power or remedy hereunder shall not preclude the
exercise thereof. Every right, power or remedy of the Lender shall
continue in full force and effect until such right, power or remedy is
specifically waived by an instrument in writing executed by the Lender.
20. Severability. Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability
without invalidating the remaining provisions hereof, and any such
prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other
jurisdiction.
21. Successors and Assigns. This Agreement is for the benefit of the Lender
and its successors and assigns, and in the event of an assignment of
all or any of the Obligations, the rights hereunder, to the extent
applicable to the indebtedness so assigned, may be transferred with
such indebtedness. This Agreement shall be binding on the Grantor and
its respective successors and assigns.
22. Consent To Jurisdiction And Service Of Process. ANY LEGAL ACTION OR
PROCEEDING WITH RESPECT TO THIS AGREEMENT MAY BE BROUGHT IN THE COURTS
OF THE STATE OF NEW YORK OR OF THE UNITED STATES FOR THE SOUTHERN
DISTRICT OF NEW YORK, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT,
EACH OF GRANTOR AND LENDER CONSENTS, FOR ITSELF AND IN RESPECT OF ITS
PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH OF
THE GRANTOR AND LENDER IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY
OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON
CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY
ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS AGREEMENT
OR ANY DOCUMENT RELATED HERETO. EACH OF GRANTOR AND LENDER WAIVES
PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY
BE MADE BY ANY OTHER MEANS PERMITTED BY NEW YORK LAW.
14
23. Waiver Of Jury Trial. EACH OF GRANTOR AND LENDER WAIVES ITS RIGHT TO A
TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT
OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY, IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE
BROUGHT BY ANY PARTY AGAINST ANY OTHER PARTY, WHETHER WITH RESPECT TO
CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. EACH OF GRANTOR AND LENDER
AGREES THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE TRIED BY A COURT
TRIAL WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, EACH OF GRANTOR
AND LENDER FURTHER AGREES THAT ITS RIGHT TO A TRIAL BY JURY IS WAIVED
BY OPERATION OF THIS SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER
PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY
OR ENFORCEABILITY OF THIS AGREEMENT OR ANY PROVISION HEREOF. THIS
WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS
OR MODIFICATIONS TO THIS AGREEMENT.
24. Advice of Counsel; Construction. Each of Grantor and Lender represents
and warrants that it has discussed this Agreement, including, without
limitation, Section 22 and Section 23 hereof, with its counsel. The
parties hereto have participated jointly in the negotiation and
drafting of this Agreement. In the event an ambiguity or question of
intent or interpretation arises, this Agreement shall be construed as
if drafted jointly by the parties hereto and no presumption or burden
of proof shall arise favoring or disfavoring any party by virtue of the
authorship of any provisions of the Agreement.
25. Headings. The various headings in this Agreement are inserted for
convenience only and shall not affect the meanings or interpretation of
this Agreement or any provision hereof.
26. Governing Law. This Agreement shall be governed by, and construed in
accordance with, the internal laws of the State of New York determined
without reference to principles of conflicts of law, except to the
extent that the validity or perfection of any security interest created
hereunder, or remedies hereunder, in respect of any item of the
Collateral is governed by the laws of a jurisdiction other than the
State of New York.
27. Counterparts; Facsimile Execution. This Agreement may be executed in
counterparts, each of which shall constitute an original. A facsimile
or other copy of any signature hereto transmitted by electronic means
shall have the same force and effect as an original thereof.
[signature page follows]
15
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed and delivered as of the date first above written.
BRIDGE ONCOLOGY PRODUCTS, INC.
By: /s/ XXXXXXXX X. XXXXXXXXX
--------------------------------------
Name: Xxxxxxxx X. Xxxxxxxxx
Title: Chairman
Address: 00 Xxx Xxxxxx Xxxxx
Xxxxxxx Xxxxx, XX 00000
Attention: Xxxxxxxx Xxxxxxxxx
Telephone No.: 000-000-0000
Federal Taxpayer Identification
No.: 00-0000000
Organizational No.:
State of Incorporation: Delaware
SCO CAPITAL PARTNERS LLC
By: /s/ XXXXXX XXXXXXXXX
--------------------------------------
Name: Xxxxxx Xxxxxxxxx
Title: Chairman
Address: 1285 Avenue of the Xxxxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telephone Number: 000-000-0000
16
