Legal Security and Pledge Agreement

LEGAL SECURITY AND PLEDGE AGREEMENT

This Security and Pledge Agreement (the Agreement) is made as of the day of , , by and between Secured Party Name: , Entity Type: , Principal Place of Business: (Secured Party), and Pledgor Name: , Entity Type: , Principal Place of Business: (Pledgor).

RECITALS

WHEREAS, Pledgor is indebted to Secured Party or will become indebted under certain obligations described herein and desires to grant to Secured Party a security interest in and to certain property to secure the prompt payment and performance of such obligations; and

WHEREAS, Secured Party is willing to accept a security interest and pledge in the Collateral described below as security for the Obligations on the terms and conditions set forth in this Agreement; and

WHEREAS, the parties intend that this Agreement create a valid, perfected, first-priority security interest in and to the Collateral to the extent permitted by applicable law and to set forth the rights and remedies of the parties with respect to such Collateral.

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

1. DEFINITIONS

For purposes of this Agreement, the following terms shall have the meanings set forth below:

(a) "Obligations" means all present and future debts, obligations, liabilities, indemnities and other monetary or performance obligations of Pledgor to Secured Party, whether direct or indirect, absolute or contingent, due or to become due, including principal, interest, fees, costs, and expenses, as secured hereby.

(b) "Collateral" means all property and assets of Pledgor described in Section 3 and any and all proceeds, products, replacements and accessions thereof, whether now owned or hereafter acquired.

2. GRANT OF SECURITY INTEREST

Pledgor hereby pledges, assigns, transfers, conveys and grants to Secured Party a continuing security interest in, and lien upon, all right, title and interest of Pledgor in and to the Collateral to secure the prompt payment and performance of the Obligations. The security interest granted hereunder shall be a first-priority security interest to the maximum extent permitted by applicable law, subject only to Permitted Encumbrances.

3. COLLATERAL

The Collateral shall include all of Pledgor's present and future personal property, including without limitation: accounts, general intangibles, inventory, equipment, chattel paper, instruments, documents, securities, investment property, contract rights, deposit accounts and all proceeds thereof. Specific description of material items or account groups (if any) is set forth below and in any schedules attached hereto and incorporated by reference.

4. REPRESENTATIONS AND WARRANTIES OF PLEDGOR

Pledgor represents and warrants to Secured Party that as of the date hereof and as of each date on which Obligations are incurred: (a) Pledgor is the sole legal and beneficial owner of the Collateral and has good and marketable title thereto free and clear of any lien, security interest or other encumbrance except those specifically disclosed in writing to Secured Party (Permitted Encumbrances); (b) Pledgor has full power and authority to grant the security interest and to perform its obligations under this Agreement; (c) the execution, delivery and performance of this Agreement will not violate any law, agreement, or instrument binding on Pledgor; and (d) no authorization, approval or consent of any third party or governmental authority is required to create or perfect the security interest granted herein other than filings or recordings contemplated by Section 6.

5. COVENANTS

Pledgor covenants and agrees that, so long as any Obligations remain outstanding: (a) Pledgor will defend the Collateral against claims and demands of all persons, will not create or permit any lien or security interest in the Collateral except Permitted Encumbrances, and will not sell, transfer or otherwise dispose of the Collateral except in the ordinary course of business with prior written consent of Secured Party; (b) Pledgor will maintain insurance on the Collateral against loss or damage in amounts reasonably satisfactory to Secured Party and will name Secured Party as loss payee or additional insured where appropriate; (c) Pledgor will provide Secured Party with such information, books, records and access as Secured Party reasonably requests relating to the Collateral; and (d) Pledgor will, at its expense, execute and deliver such financing statements, continuation statements, control agreements and other documents as Secured Party may reasonably request to perfect and maintain the security interest granted hereby.

6. PERFECTION; REGISTRATION; CONTROL

Pledgor authorizes Secured Party to file financing statements, notices and other documents necessary to perfect and protect Secured Party's security interest in the Collateral. Pledgor agrees to cooperate in executing all such documents and will pay all reasonable filing, recording or other costs incurred by Secured Party in connection with perfection and preservation of its security interest. To the extent permissible, Secured Party may take, and Pledgor grants to Secured Party, control of any deposit accounts, investment property or certificated securities to perfect Secured Party's security interest.

7. DEFAULT

The occurrence of any of the following shall constitute an Event of Default: (a) failure by Pledgor to pay any monetary Obligation when due; (b) failure by Pledgor to perform any covenant or obligation hereunder and such failure is not remedied within ten (10) days after written notice; (c) any representation or warranty made by Pledgor in this Agreement is false in any material respect when made; (d) insolvency, commencement of bankruptcy, receivership or similar proceedings by or against Pledgor; or (e) levy, seizure or attachment of a substantial portion of the Collateral.

8. REMEDIES UPON DEFAULT

Upon the occurrence of an Event of Default, Secured Party may, at its option and without further notice or demand to the extent permitted by applicable law, exercise any or all rights and remedies available to a secured party under applicable law or in equity, including without limitation: (a) declare all Obligations immediately due and payable; (b) take possession of the Collateral and any documents of title or records relating thereto; (c) sell, lease, license or otherwise dispose of the Collateral in a commercially reasonable manner and apply proceeds against the Obligations after deducting Secured Party's expenses; (d) require Pledgor to assemble the Collateral and make it available to Secured Party; and (e) pursue injunctive or other equitable relief. Secured Party shall be entitled to recover from Pledgor all costs and expenses (including attorneys' fees and legal expenses) incurred in exercising its remedies.

9. APPLICATION OF PROCEEDS

Proceeds from any disposition of Collateral shall be applied in the following order: (a) costs and expenses of retaking, holding, preparing for sale, processing, selling and the like, including reasonable attorneys' fees; (b) to the payment of the Obligations in such order as Secured Party determines; and (c) the balance, if any, to Pledgor or as otherwise required by law.

10. NOTICES

All notices, consents, requests, claims, demands and other communications hereunder shall be in writing and delivered to the parties at their respective addresses set forth below (or to such other address as a party may designate by notice in accordance with this Section). Notices shall be deemed given when delivered by hand, by nationally recognized overnight courier, or three (3) days after being deposited in the mail, postage prepaid, certified or registered mail, return receipt requested.

11. AMENDMENT; WAIVER; COUNTERPARTS

This Agreement may be amended or modified only by a written instrument executed by both parties. No failure or delay by Secured Party in exercising any right shall operate as a waiver of such right, nor shall any single or partial exercise preclude any other or further exercise. This Agreement may be executed in counterparts, each of which shall be deemed an original and all of which together shall constitute one instrument.

12. GOVERNING LAW

This Agreement shall be governed by and construed in accordance with the laws of the State or jurisdiction specified below, without regard to conflict of laws principles. The parties submit to the exclusive jurisdiction of the courts of that jurisdiction for disputes arising out of or relating to this Agreement.

13. ENTIRE AGREEMENT; SEVERABILITY

This Agreement, together with any schedules, exhibits and financing statements delivered hereunder, constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior agreements and understandings relating thereto. If any provision of this Agreement is held invalid or unenforceable, the remaining provisions shall remain in full force and effect and such invalid or unenforceable provision shall be reformed only to the minimum extent necessary to make it valid and enforceable.

14. ATTORNEYS' FEES AND COSTS

In the event of any action or proceeding to enforce this Agreement or collect any Obligation, the prevailing party shall be entitled to recover from the non-prevailing party all reasonable costs and expenses, including attorneys' fees and court costs, incurred in connection therewith.

15. FURTHER ASSURANCES

Each party shall execute and deliver all further instruments and take such further actions as reasonably may be required to carry out the intent and purposes of this Agreement, including but not limited to entering into control agreements, providing notices to account debtors, and executing additional security documents.

16. TAXES; EXPENSES

Pledgor shall pay and be responsible for all taxes, filing fees, recording fees and other expenses incurred in connection with the preparation, filing and perfection of this Agreement and any related financing statements or instruments, except to the extent such amounts are expressly assumed by Secured Party in writing.

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