FORM OF PLEDGE AND SECURITY AGREEMENT
This SECURITY AGREEMENT, dated as of June 21, 2006 (this "AGREEMENT"),
is entered into by and among MAVERICK OIL AND GAS, INC., a Nevada corporation
(the "DEBTOR"), and _____________________________ and _________________________
(together, the "SECURED PARTIES"), the Holders of those certain Secured
Convertible Debentures due June 21, 2007 (or other date as set forth therein) in
the original aggregate principal amount of $10,000,000 (the "DEBENTURES"),
issued by Debtor to the Secured Parties in connection with that certain
Securities Purchase Agreement entered into by and between the Debtor and the
Secured Parties on the date hereof (the "SECURITIES PURCHASE AGREEMENT").
W I T N E S S E T H:
WHEREAS, pursuant to the Debentures, the Secured Parties have agreed to
extend certain loans described above to the Debtor as evidenced by the
Debentures; and
WHEREAS, in order to induce the Secured Parties to extend the loans
evidenced by the Debentures, the Debtor has agreed to execute and deliver to the
Secured Parties this Agreement and to grant the Secured Parties a security
interest in all property of the Debtor to secure the prompt payment, performance
and discharge in full of all of the Debtor's obligations under the Debentures.
NOW, THEREFORE, in consideration of the agreements herein contained and
for other good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, the parties hereto hereby agree as follows:
1. CERTAIN DEFINITIONS. As used in this Agreement, the following terms
shall have the meanings set forth in this Section 1. Terms used but not
otherwise defined in this Agreement that are defined in Article 9 of the UCC
(such as "general intangibles" and "proceeds") shall have the respective
meanings given such terms in Article 9 of the UCC, and capitalized terms not
otherwise defined herein shall have the meaning given them in the Securities
Purchase Agreement described above.
(a) "Collateral" means the collateral in which the Secured Parties
are granted a security interest by this Agreement and which shall
include the following, whether presently owned or existing or hereafter
acquired or coming into existence, and all additions and accessions
thereto and all substitutions and replacements thereof, and all
proceeds, products and accounts thereof, including, without limitation,
all proceeds from the sale or transfer of the Collateral and of
insurance covering the same and of any tort claims in connection
therewith:
(i) all Accounts, Deposit Accounts, Instruments, Documents, Chattel
Paper (whether Tangible Chattel Paper or Electronic Chattel Paper),
Goods (including Inventory, Equipment, Fixtures and Motor Vehicles),
Payment Intangibles, Software and other General Intangibles and all
Letter-of-Credit Rights;
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(ii) the shares of common stock and preferred stock of, or
partnership, membership and other ownership interests in any subsidiary
organized under the laws of the United States or any political
subdivision thereof, now or hereafter owned by the Debtor, and all
certificates evidencing the same (collectively, the "PLEDGED EQUITY"),
together with, in each case:
(1) all shares, securities, monies or property representing a
dividend on any of the Pledged Equity, or representing a distribution
or return of capital upon or in respect of the Pledged Equity, or
resulting from a split up, revision, reclassification or other like
change of the Pledged Equity or otherwise received in exchange
therefor, and any subscription warrants, rights or options issued to
the holders of, or otherwise in respect of, the Pledged Equity, and
(2) without affecting the obligations of the Debtor under any
provision prohibiting such action hereunder or under any Transaction
Document, in the event of any consolidation or merger or similar
transaction in which a subsidiary of the Debtor is not the surviving
corporation, all ownership interests of any class or character of the
successor corporation (unless such successor corporation is the Debtor
itself), formed by or resulting from such consolidation or merger (the
Pledged Equity, together with all other certificates, shares,
securities, properties or moneys as may from time to time be pledged
hereunder pursuant to this clause (ii) and clause (i) above being
herein collectively called the "EQUITY Collateral");
(iii) all Investment Property, Financial Assets and Securities
Accounts not covered by the foregoing clauses (i), (i) and (iii);
(iv) all Intellectual Property;
(v) all commercial tort claims described on Schedule C hereto;
(vi) all other tangible and intangible property of the Debtor,
including all books, correspondence, credit files, records, invoices,
tapes, cards, computer runs and other papers and documents in the
possession or under the control of the Debtor or any computer bureau or
service company from time to time acting for the Debtor;
(vii) all Proceeds and products in whatever form of all or any part
of the other Collateral, including all rents, profits, income and
benefits and all proceeds of insurance and all condemnation awards and
all other compensation for any event of loss with respect to all or any
part of the other Collateral (together with all rights to recover and
proceed with respect to the same), and all accessions to, substitutions
for and replacements of all or any part of the other Collateral.
(b) "Obligations" means all obligations of the Debtor owed to the
Secured Parties whether now or hereafter existing, voluntary or
involuntary, direct or indirect, absolute or contingent, liquidated or
unliquidated, whether or not jointly owed with others, and whether or
not from time to time decreased or extinguished and later increased,
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created or incurred, and all or any portion of such obligations or
liabilities that are paid, to the extent all or any part of such
payment is avoided or recovered directly or indirectly from the Secured
Parties as a preference, fraudulent transfer or otherwise as such
obligations may be amended, supplemented, converted, extended or
modified from time to time.
(c) "UCC" means the Uniform Commercial Code and or any other
applicable law of any jurisdiction (including, without limitation, the
state of Nevada and New York) as to any Collateral located therein.
2. GRANT OF SECURITY INTEREST. As an inducement for the Secured Parties
to extend the loans as evidenced by the Debentures and to secure the complete
and timely payment, performance and discharge in full, as the case may be, of
all of the Obligations, the Debtor hereby unconditionally and irrevocably
pledges, grants and hypothecates to the Secured Parties a continuing security
interest in and to, a lien upon and a right of set-off against all of their
respective right, title and interest of whatsoever kind and nature in and to,
the Collateral (the "SECURITY INTEREST").
3. REPRESENTATIONS, WARRANTIES, COVENANTS AND AGREEMENTS OF THE DEBTOR.
The Debtor represents and warrants to, and covenants and agrees with, the
Secured Parties as follows:
(a) The Debtor has the requisite corporate power and authority to
enter into this Agreement and otherwise to carry out its obligations
hereunder. The execution, delivery and performance by the Debtor of
this Agreement and the filings contemplated therein have been duly
authorized by all necessary action on the part of the Debtor and no
further action is required by the Debtor.
(b) The Debtor represents and warrants that they have no place of
business or offices where their respective books of account and records
are kept (other than temporarily at the offices of its attorneys or
accountants) or places where Collateral is stored or located, except as
set forth on Schedule A attached hereto.
(c) The Debtor is the sole owner of the Collateral (except for
non-exclusive licenses granted by the Debtor in the ordinary course of
business), free and clear of any liens, security interests,
encumbrances, rights or claims, and are fully authorized to grant the
Security Interest in and to pledge the Collateral. There is not on file
in any governmental or regulatory authority, agency or recording office
an effective financing statement, security agreement, license or
transfer or any notice of any of the foregoing (other than those that
will be filed in favor of the Secured Parties pursuant to this
Agreement) covering or affecting any of the Collateral. So long as this
Agreement shall be in effect, Debtor shall not execute and shall not
knowingly permit to be on file in any such office or agency any such
financing statement or other document or instrument (except to the
extent filed or recorded in favor of the Secured Parties pursuant to
the terms of this Agreement).
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(d) No part of the Collateral has been judged invalid or
unenforceable. No written claim has been received that any Collateral
or Debtor's use of any Collateral violates the rights of any third
party. There has been no adverse decision to Debtor's claim of
ownership rights in or exclusive rights to use the Collateral in any
jurisdiction or to Debtor's right to keep and maintain such Collateral
in full force and effect, and there is no proceeding involving said
rights pending or, to the best knowledge of the Debtor, threatened
before any court, judicial body, administrative or regulatory agency,
arbitrator or other governmental authority.
(e) The Debtor shall at all times maintain its books of account and
records relating to the Collateral at its principal place of business
and its Collateral at the locations set forth on Schedule A attached
hereto and may not relocate such books of account and records or
tangible Collateral unless it delivers to the Secured Parties at least
30 days prior to such relocation (i) written notice of such relocation
and the new location thereof (which must be within the United States)
and (ii) evidence that appropriate financing statements under the UCC
and other necessary documents have been filed and recorded and other
steps have been taken to perfect the Security Interest to create in
favor of each of the Secured Parties a valid, perfected and continuing
perfected first priority lien in the Collateral.
(f) This Agreement creates in favor of the Secured Parties a valid
security interest in the Collateral securing the payment and
performance of the Obligations and, upon making the filings described
in the immediately following sentence, a perfected first priority
security interest in such Collateral.
(g) The Debtor hereby authorizes each of the Secured Parties to file
one or more financing statements under the UCC, with respect to the
Security Interest with the proper filing and recording agencies in any
jurisdiction deemed proper by them.
(h) The execution, delivery and performance of this Agreement by the
Debtor does not conflict with, or constitute a default (or an event
that with notice or lapse of time or both would become a default)
under, or give to others any rights of termination, amendment,
acceleration or cancellation (with or without notice, lapse of time or
both) of, any agreement, credit facility, debt or other instrument
(evidencing Debtor's debt or otherwise) or other understanding to which
Debtor is a party or by which any property or asset of the Debtor is
bound or affected. No consent (including, without limitation, from
stockholders or creditors of the Debtor) is required for the Debtor to
enter into and perform its obligations hereunder.
(i) The Debtor shall at all times maintain the liens and Security
Interest provided for hereunder as valid and perfected first priority
liens and security interests in the Collateral in favor of the Secured
Parties until this Agreement and the Security Interest hereunder shall
be terminated pursuant to Section 11 hereof. The Debtor hereby agrees
to defend the same against any and all persons. The Debtor shall
safeguard and protect all Collateral for the account of the Secured
Parties. Debtor irrevocably authorizes the Secured Parties at any time
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and from time to time to file in any filing office in any jurisdiction
any initial financing statement or amendment thereto that indicates the
collateral as "all assets" or "all personal property" of the Debtor or
words of similar effect and will pay the cost of filing the same in all
public offices wherever filing is, or is deemed by the Secured Parties
to be, necessary or desirable to effect the rights and obligations
provided for herein. Without limiting the generality of the foregoing,
the Debtor shall pay all fees, taxes and other amounts necessary to
maintain the Collateral and the Security Interest hereunder, and the
Debtor shall obtain and furnish to the Secured Parties from time to
time, upon demand, such releases and/or subordinations of claims and
liens which may be required to maintain the priority of the Security
Interest hereunder.
(j) The Debtor will not transfer, pledge, hypothecate, encumber,
license (except for non-exclusive licenses granted by a Debtor in its
ordinary course of business and sales of inventory), sell or otherwise
dispose of any of the Collateral without the prior written consent of
the Secured Parties.
(k) The Debtor shall keep and preserve its Equipment, Inventory and
other tangible Collateral in good condition, repair and order and shall
not operate or locate any such Collateral (or cause to be operated or
located) in any area excluded from insurance coverage.
(l) The Debtor shall, within ten (10) days of obtaining knowledge
thereof, advise the Secured Parties promptly, in sufficient detail, of
any substantial change in the Collateral, and of the occurrence of any
event which would have a material adverse effect on the value of the
Collateral or on the Secured Parties' security interest therein.
(m) The Debtor shall promptly execute and deliver to the Secured
Parties such further deeds, mortgages, assignments, security
agreements, financing statements or other instruments, documents,
certificates and assurances and take such further action as the such
Secured Party may from time to time request and may in its sole
discretion deem necessary to perfect, protect or enforce its security
interest in the Collateral including, without limitation, if
applicable, the execution and delivery of a separate security agreement
with respect to each Debtor's intellectual property ("INTELLECTUAL
PROPERTY SECURITY AGREEMENT") in which each of the Secured Parties has
been granted a security interest hereunder, substantially in a form
acceptable to the Secured Party, which Intellectual Property Security
Agreement, other than as stated therein, shall be subject to all of the
terms and conditions hereof.
(n) The Debtor shall permit the Secured Parties and their
representatives and agents to inspect the Collateral at any time, and
to make copies of records pertaining to the Collateral as may be
requested by the Secured Parties from time to time.
(o) The Debtor shall take all steps reasonably necessary to
diligently pursue and seek to preserve, enforce and collect any rights,
claims, causes of action and accounts receivable in respect of the
Collateral.
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(p) The Debtor shall promptly notify the Secured Parties in
sufficient detail upon becoming aware of any attachment, garnishment,
execution or other legal process levied against any Collateral and of
any other information received by the Debtor that may materially affect
the value of the Collateral, the Security Interest or the rights and
remedies of the Secured Parties hereunder.
(q) All information heretofore, herein or hereafter supplied to the
Secured Parties by or on behalf of the Debtor with respect to the
Collateral is accurate and complete in all material respects as of the
date furnished.
(r) The Debtor shall at all times preserve and keep in full force
and effect their respective valid existence and good standing and any
rights and franchises material to its business.
(s) The Debtor will not change its name, corporate structure, or
identity, or add any new fictitious name unless it provides at least 30
days prior written notice to the Secured Parties of such change and, at
the time of such written notification, such Debtor provides any
financing statements or fixture filings necessary to perfect and
continue perfected the perfected first priority Security Interest
granted and evidenced by this Agreement.
(t) The Debtor may not consign any of its Inventory or sell any of
its Inventory on xxxx and hold, sale or return, sale on approval, or
other conditional terms of sale without the consent of the Secured
Parties which shall not be unreasonably withheld.
(u) The Debtor may not relocate its chief executive office to a new
location without providing thirty (30) days prior written notification
thereof to the Secured Parties and so long as, at the time of such
written notification, the Debtor provides any financing statements or
fixture filings necessary to perfect and continue perfected the
perfected first priority Security Interest granted and evidenced by
this Agreement.
(v) The Debtor, to the extent any of its subsidiaries has opted, or
in the future opts, into Article 8 of the UCC, shall not allow such
entity to amend its organizational documents so as to opt out of
Article 8 of the UCC.
(w) Within thirty (30) days of the Closing Date, Debtor shall cause
each of the entities listed on Schedule D hereto to simultaneously (i)
amend and restate its limited liability operating agreement (or similar
company agreement) so as to cause the entity to opt-into Article 8 of
the UCC; (ii) certificate its equity interests in a form reasonably
acceptable to the Secured Parties; (iii) deliver such certificates to
the Majority Secured Party, which shall hold such certificates on
behalf of itself and, solely for purposes of perfecting any other
Secured Parties' security interest therein, as agent for all Secured
Parties, together with unit powers endorsed in blank; and (iv) provide
an opinion of counsel regarding perfection and validity of the Secured
Parties' security interest therein in a form reasonably satisfactory to
the Secured Parties.
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4. Defaults. The following events shall be "EVENTS OF DEFAULT":
(a) The occurrence of an Event of Default (as defined in the
Debentures or any Prior Debenture (as defined in the Debentures)) under
any Debenture or any Prior Debenture;
(b) Any representation or warranty of Debtor in this Agreement shall
prove to have been incorrect in any material respect when made;
(c) The failure by Debtor to observe or perform any of its
obligations hereunder for five (5) days after delivery to Debtor of
notice of such failure by or on behalf of a either Secured Party; or
(d) If any provision of this Agreement shall at any time for any
reason be declared to be null and void, or the validity or
enforceability thereof shall be contested by Debtor, or a proceeding
shall be commenced by Debtor, or by any governmental authority having
jurisdiction over Debtor, seeking to establish the invalidity or
unenforceability thereof, or Debtor shall deny that Debtor has any
liability or obligation purported to be created under this Agreement.
5. Duty To Hold In Trust. Upon the occurrence of any Event of Default
and at any time thereafter, the Debtor shall, upon receipt of any revenue,
income or other sums subject to the Security Interest, whether payable pursuant
to the Debentures or otherwise, or of any check, draft, note, trade acceptance
or other instrument evidencing an obligation to pay any such sum, hold the same
in trust for the Secured Parties and shall forthwith endorse and transfer any
such sums or instruments, or both, to the Secured Parties (pro rata in
accordance with the principal amount of Debentures held by each) for application
to the satisfaction of the Obligations.
6. Rights and Remedies Upon Default. Upon the occurrence of any Event
of Default and at any time thereafter, each Secured Party shall have the right
to exercise all of the remedies conferred hereunder and under the Debentures,
and each Secured Party shall have all the rights and remedies of a secured party
under the UCC. Without limitation, each Secured Party shall have the following
rights and powers:
(a) The Majority Secured Party shall have the right to take
possession of the Collateral and, for that purpose, enter, with the aid
and assistance of any person, any premises where the Collateral, or any
part thereof, is or may be placed and remove the same, and the Debtor
shall assemble the Collateral and make it available to the Majority
Secured Party at places which the Majority Secured Party shall
reasonably select, whether at the Debtor's premises or elsewhere, and
make available to the Majority Secured Party, without rent, all of the
Debtor's respective premises and facilities for the purpose of the
Majority Secured Party taking possession of, removing or putting the
Collateral in saleable or disposable form.
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(b) The Majority Secured Party shall have the right to operate the
business of the Debtor using the Collateral and shall have the right to
assign, sell, lease or otherwise dispose of and deliver all or any part
of the Collateral, at public or private sale or otherwise, either with
or without special conditions or stipulations, for cash or on credit or
for future delivery, in such parcel or parcels and at such time or
times and at such place or places, and upon such terms and conditions
as the Majority Secured Party may deem commercially reasonable, all
without (except as shall be required by applicable statute and cannot
be waived) advertisement or demand upon or notice to the Debtor or
right of redemption of a Debtor, which are hereby expressly waived.
Upon each such sale, lease, assignment or other transfer of Collateral,
the Majority Secured Party may, unless prohibited by applicable law
which cannot be waived, purchase all or any part of the Collateral
being sold, free from and discharged of all trusts, claims, right of
redemption and equities of the Debtor, which are hereby waived and
released. For purposes of this Agreement, "MAJORITY SECURITY PARTY"
shall mean the Secured Party or Security Parties that hold in the
aggregate a Debenture or Debentures representing a majority in
aggregate principal amount of all Debentures.
7. Applications of Proceeds. The proceeds of any such sale, lease or
other disposition of the Collateral hereunder shall be applied first, to the
expenses of retaking, holding, storing, processing and preparing for sale,
selling, and the like (including, without limitation, any taxes, fees and other
costs incurred in connection therewith) of the Collateral, to the reasonable
attorneys' fees and expenses incurred by the Majority Secured Party in enforcing
its rights hereunder and in connection with collecting, storing and disposing of
the Collateral, and then to satisfaction of the Obligations to each Secured
Party, and to the payment of any other amounts required by applicable law, after
which the Secured Parties shall pay to the Debtor any surplus proceeds. If, upon
the sale, license or other disposition of the Collateral, the proceeds thereof
are insufficient to pay all amounts to which the Secured Parties are legally
entitled, the Debtor will be liable for the deficiency, together with interest
thereon, at the rate of 15% per annum or the lesser amount permitted by
applicable law (the "DEFAULT RATE"), and the reasonable fees of any attorneys
employed by the Majority Secured Party to collect such deficiency. To the extent
permitted by applicable law, the Debtor waives all claims, damages and demands
against the Secured Parties arising out of the repossession, removal, retention
or sale of the Collateral, unless due to the gross negligence or willful
misconduct of the Secured Parties.
8. Costs and Expenses. The Debtor agrees to pay all reasonable
out-of-pocket fees, costs and expenses incurred in connection with any filing
required hereunder, including without limitation, any financing statements
pursuant to the UCC, continuation statements, partial releases and/or
termination statements related thereto or any expenses of any searches
reasonably required by any Secured Party. The Debtor shall also pay all other
claims and charges which in the reasonable opinion of the Majority Secured Party
might prejudice, imperil or otherwise affect the Collateral or the Security
Interest therein. The Debtor will also, upon demand, pay to the Majority Secured
Party the amount of any and all reasonable expenses, including the reasonable
fees and expenses of its counsel and of any experts and agents, which the
Majority Secured Party may incur in connection with (i) the enforcement of this
Agreement, (ii) the custody or preservation of, or the sale of, collection from,
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or other realization upon, any of the Collateral, or (iii) the exercise or
enforcement of any of the rights of the Secured Parties under the Debentures.
Until so paid, any fees payable hereunder shall be added to the principal amount
of the Debentures and shall bear interest at the Default Rate.
9. Responsibility for Collateral. The Debtor assumes all liabilities
and responsibility in connection with all Collateral, and the Obligations in no
way be affected or diminished by reason of the loss, destruction, damage or
theft of any of the Collateral or its unavailability for any reason.
10. Security Interest Absolute. All rights of each Secured Party and
all Obligations of the Debtor hereunder, shall be absolute and unconditional,
irrespective of: (a) any lack of validity or enforceability of this Agreement,
the Debentures or any agreement entered into in connection with the foregoing,
or any portion hereof or thereof; (b) any change in the time, manner or place of
payment or performance 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 Debentures or any other agreement entered into in connection with the
foregoing; (c) any exchange, release or nonperfection of any of the Collateral,
or any release or amendment or waiver of or consent to departure from any other
collateral for, or any guaranty, or any other security, for all or any of the
Obligations; (d) any action by the Majority Secured Party to obtain, adjust,
settle and cancel in its sole discretion any insurance claims or matters made or
arising in connection with the Collateral; or (e) any other circumstance which
might otherwise constitute any legal or equitable defense available to a Debtor,
or a discharge of all or any part of the Security Interest granted hereby. Until
the Obligations shall have been paid and performed in full, the rights of each
Secured Party shall continue even if the Obligations are barred for any reason,
including, without limitation, the running of the statute of limitations or
bankruptcy. The Debtor expressly waives presentment, protest, notice of protest,
demand, notice of nonpayment and demand for performance. In the event that at
any time any transfer of any Collateral or any payment received by any Secured
Party hereunder shall be deemed by final order of a court of competent
jurisdiction to have been a voidable preference or fraudulent conveyance under
the bankruptcy or insolvency laws of the United States, or shall be deemed to be
otherwise due to any party other than any Secured Party, then, in any such
event, the Debtor's obligations hereunder shall survive cancellation of this
Agreement, and shall not be discharged or satisfied by any prior payment thereof
and/or cancellation of this Agreement, but shall remain a valid and binding
obligation enforceable in accordance with the terms and provisions hereof. The
Debtor waives all right to require a Secured Party to proceed against any other
person or to apply any Collateral which such Secured Party may hold at any time,
or to marshal assets, or to pursue any other remedy. The Debtor waives any
defense arising by reason of the application of the statute of limitations to
any obligation secured hereby.
11. Term of Agreement. This Agreement and the Security Interest shall
terminate on the date on which all payments under the Debentures have been made
in full or have been satisfied and all other Obligations have been paid or
discharged. Upon such termination, each Secured Party, at the request and at the
expense of the Debtor, will join in executing any termination statement with
respect to any financing statement executed and filed pursuant to this
Agreement.
12. Power of Attorney; Further Assurances.
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(a) The Debtor authorizes the Majority Secured Party, and does
hereby make, constitute and appoint the Majority Secured Party and its
respective officers, agents, successors or assigns with full power of
substitution, as the Debtor's true and lawful attorney-in-fact, with
power, in the name of the Majority Secured Party or the Debtor, to,
after the occurrence and during the continuance of an Event of Default,
(i) endorse any note, checks, drafts, money orders or other instruments
of payment (including payments payable under or in respect of any
policy of insurance) in respect of the Collateral that may come into
possession of the Secured Party; (ii) to sign and endorse any financing
statement pursuant to the UCC or any invoice, freight or express xxxx,
xxxx of lading, storage or warehouse receipts, drafts against debtors,
assignments, verifications and notices in connection with accounts, and
other documents relating to the Collateral; (iii) to pay or discharge
taxes, liens, security interests or other encumbrances at any time
levied or placed on or threatened against the Collateral; (iv) to
demand, collect, receipt for, compromise, settle and xxx for monies due
in respect of the Collateral; and (v) generally, to do, at the option
of the Majority Secured Party, and at the expense of the Debtor, at any
time, or from time to time, all acts and things which the Majority
Secured Party deem necessary to protect, preserve and realize upon the
Collateral and the Security Interest granted therein in order to effect
the intent of this Agreement and the Debentures all as fully and
effectually as the Debtor might or could do; and the Debtor hereby
ratifies all that said attorney shall lawfully do or cause to be done
by virtue hereof. This power of attorney is coupled with an interest
and shall be irrevocable for the term of this Agreement and thereafter
as long as any of the Obligations shall be outstanding.
(b) On a continuing basis, the Debtor will make, execute,
acknowledge, deliver, file and record, as the case may be, with the
proper filing and recording agencies in any jurisdiction, including,
without limitation, the jurisdictions indicated on Schedule B attached
hereto, all such instruments, and take all such action as may
reasonably be deemed necessary or advisable, or as reasonably requested
by the Majority Secured Party, to perfect the Security Interest granted
hereunder and otherwise to carry out the intent and purposes of this
Agreement, or for assuring and confirming to the Majority Secured Party
the grant or perfection of a perfected first priority security interest
in all the Collateral under the UCC.
(c) The Debtor hereby irrevocably appoints the Majority Secured
Party as the Debtor's attorney-in-fact, with full authority in the
place and instead of the Debtor and in the name of the Debtor, from
time to time in the Majority Secured Party's discretion, to take any
action and to execute any instrument which the Majority Secured Party
may deem necessary or advisable to accomplish the purposes of this
Agreement, including the filing, in its sole discretion, of one or more
financing or continuation statements and amendments thereto, relative
to any of the Collateral without the signature of the Debtor where
permitted by law.
13. Notices. All notices, requests, demands and other communications
hereunder shall be subject to the notice provision of the Purchase Agreement.
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14. Other Security. To the extent that the Obligations are now or
hereafter secured by property other than the Collateral or by the guarantee,
endorsement or property of any other person, firm, corporation or other entity,
then the Majority Secured Party shall have the right, in its sole discretion, to
pursue, relinquish, subordinate, modify or take any other action with respect
thereto, without in any way modifying or affecting any of the Secured Party's
rights and remedies hereunder.
15. Best Efforts for Licensed Collateral. Notwithstanding any other
provision contained herein or any of the Transaction Documents, upon the
occurrence of an Event of Default, the Debtor hereby agrees that with respect to
any part of the Collateral which may require the consent of any third party or
third parties in order for Debtor to transfer and/or convey its interest in and
to such Collateral to the Majority Secured Party, as may be required in
accordance herewith, Debtor agrees to and shall use its best efforts to obtain
such consents or approvals in as expedient manner as possible.
16. Miscellaneous.
(a) No course of dealing between the Debtor and any Secured Party,
nor any failure to exercise, nor any delay in exercising, on the part
of any Secured Party, any right, power or privilege hereunder or under
the Debentures shall operate as a waiver thereof; nor shall any single
or partial exercise of any right, power or privilege hereunder or
thereunder preclude any other or further exercise thereof or the
exercise of any other right, power or privilege.
(b) All of the rights and remedies of each Secured Party with
respect to the Collateral, whether established hereby or by the
Debentures or by any other agreements, instruments or documents or by
law shall be cumulative and may be exercised singly or concurrently.
(c) This Agreement constitutes the entire agreement of the parties
with respect to the subject matter hereof and is intended to supersede
all prior negotiations, understandings and agreements with respect
thereto. Except as specifically set forth in this Agreement, no
provision of this Agreement may be modified or amended except by a
written agreement specifically referring to this Agreement and signed
by the parties hereto.
(d) In the event any provision of this Agreement is held to be
invalid, prohibited or unenforceable in any jurisdiction for any
reason, unless such provision is narrowed by judicial construction,
this Agreement shall, as to such jurisdiction, be construed as if such
invalid, prohibited or unenforceable provision had been more narrowly
drawn so as not to be invalid, prohibited or unenforceable. If,
notwithstanding the foregoing, any provision of this Agreement is held
to be invalid, prohibited or unenforceable in any jurisdiction, such
provision, as to such jurisdiction, shall be ineffective to the extent
of such invalidity, prohibition or unenforceability without
invalidating the remaining portion of such provision or the other
provisions of this Agreement and without affecting the validity or
enforceability of such provision or the other provisions of this
Agreement in any other jurisdiction.
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(e) No waiver of any breach or default or any right under this
Agreement shall be considered valid unless in writing and signed by the
party giving such waiver, and no such waiver shall be deemed a waiver
of any subsequent breach or default or right, whether of the same or
similar nature or otherwise.
(f) This Agreement shall be binding upon and inure to the benefit of
each party hereto and its successors and assigns.
(g) Each party shall take such further action and execute and
deliver such further documents as may be necessary or appropriate in
order to carry out the provisions and purposes of this Agreement.
(h) All questions concerning the construction, validity, enforcement
and interpretation of this Agreement shall be governed by and construed
and enforced in accordance with the internal laws of the State of New
York. Each party agrees that all proceedings concerning the
interpretations, enforcement and defense of the transactions
contemplated by this Agreement and the Debentures (whether brought
against a party hereto or its respective affiliates, directors,
officers, shareholders, employees or agents) shall be commenced
exclusively in the state and federal courts sitting in New York, New
York. Each party hereto hereby irrevocably submits to the exclusive
jurisdiction of the state and federal courts sitting in New York, New
York, New York, New York for the adjudication of any dispute hereunder
or in connection herewith or with any transaction contemplated hereby
or discussed herein, and hereby irrevocably waives, and agrees not to
assert in any proceeding, any claim that it is not personally subject
to the jurisdiction of any such court, that such proceeding is
improper. Each party hereto hereby irrevocably waives personal service
of process and consents to process being served in any such proceeding
by mailing a copy thereof via registered or certified mail or overnight
delivery (with evidence of delivery) to such party at the address in
effect for notices to it under this Agreement and agrees that such
service shall constitute good and sufficient service of process and
notice thereof. Nothing contained herein shall be deemed to limit in
any way any right to serve process in any manner permitted by law. Each
party hereto hereby irrevocably waives, to the fullest extent permitted
by applicable law, any and all right to trial by jury in any legal
proceeding arising out of or relating to this Agreement or the
transactions contemplated hereby. If either party shall commence a
proceeding to enforce any provisions of this Agreement, then the
prevailing party in such proceeding shall be reimbursed by the other
party for its reasonable attorneys fees and other costs and expenses
incurred with the investigation, preparation and prosecution of such
proceeding.
(i) This Agreement may be executed in any number of counterparts,
each of which when so executed shall be deemed to be an original and,
all of which taken together shall constitute one and the same
Agreement. In the event that any signature is delivered by facsimile
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transmission, such signature shall create a valid binding obligation of
the party executing (or on whose behalf such signature is executed) the
same with the same force and effect as if such facsimile signature were
the original thereof.
[signature page follows]
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IN WITNESS WHEREOF, the parties hereto have caused this Security
Agreement to be duly executed on the day and year first above written.
DEBTOR
MAVERICK OIL AND GAS, INC. Address for Notice and Delivery:
0000 Xxx Xxxx Xxxx., Xxxxx 000
Xxxx Xxxxxxxxxx, XX 00000
Attn: Chief Executive Officer
By:______________________________________
Name:
Title:
14
SECURED PARTY
By:__________________________________________
Name:
Title:
15
SECURED PARTY
By:__________________________________________
Name:
Title:
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SCHEDULE A
Principal Place of Business of Debtor:
0000 Xxx Xxxx Xxxx., Xxxxx 000
Xxxx Xxxxxxxxxx, XX 00000
Locations Where Collateral is Located or Stored:
0000 Xxx Xxxx Xxxx., Xxxxx 000
Xxxx Xxxxxxxxxx, XX 00000
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SCHEDULE B
State of Nevada
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SCHEDULE C
COMMERCIAL TORT CLAIMS
NONE
19
SCHEDULE D
PLEDGED EQUITY
Percentage of
Class Represented Type of
Class of Certificate by Pledged Investment
Issuer Interest Numbers LLC Interests Property
20
