Exhibit 4
SECURITY AGREEMENT
THIS SECURITY AGREEMENT (this "Agreement"), dated as of January 29,
2003, is made between Commtouch Software Ltd., an Israeli corporation ("Debtor")
and XDL Capital Corp., an Ontario corporation, as collateral agent for the
Lenders referred to below ("Secured Party").
Debtor and Secured Party hereby agree as follows:
SECTION 1 Definitions; Interpretation.
(a) All capitalized terms used in this Agreement and not otherwise
defined herein shall have the meanings assigned to them in the Convertible Loan
Agreement.
(b) As used in this Agreement, the following terms shall have the
following meanings:
"Collateral" has the meaning set forth in Section 2.
"Convertible Loan Agreement" means the Convertible Loan Agreement
dated as of January 29, 2003 among Debtor, Secured Party and the Lenders (as
amended, modified, renewed or extended from time to time).
"Documents" means this Agreement, the Convertible Loan Agreement,
the Promissory Notes, the Debenture and all other certificates, documents,
agreements and instruments delivered to Secured Party or the Lenders under the
Promissory Notes or in connection with the Obligations.
"Event of Default" has the meaning set forth in the Promissory Notes
between Debtor and Lenders.
"Lenders" means the several lending institutions named in Annex 1.
"Lien" means any mortgage, deed of trust, pledge, security interest,
assignment, deposit arrangement, charge or encumbrance, lien, or other type of
preferential arrangement.
"Obligations" means the indebtedness, liabilities and other
obligations of Debtor to Secured Party, as collateral agent, and Lenders under
or in connection with this Agreement, the Promissory Notes and the other
Documents, including, without limitation, all unpaid principal of the Promissory
Notes, all interest accrued thereon, all fees and all other amounts payable by
Debtor to Secured Party, as collateral agent, and Lenders thereunder or in
connection therewith, whether now existing or hereafter arising, and whether due
or to become due, absolute or contingent, liquidated or unliquidated determined
or undetermined, and including interest that accrues after the commencement by
or against Debtor of any bankruptcy or insolvency proceeding naming such Person
as the debtor in such proceeding.
"Person" means an individual, corporation, partnership, joint
venture, trust, unincorporated organization, governmental agency or authority,
or any other entity of whatever nature.
"UCC" means the Uniform Commercial Code as the same may, from time
to time, be in effect in the State of California.
(c) Where applicable and except as otherwise defined herein, terms
used in this Agreement shall have the meanings assigned to them in the UCC.
(d) In this Agreement, (i) the meaning of defined terms shall be
equally applicable to both the singular and plural forms of the terms defined;
and (ii) the captions and headings are for convenience of reference only and
shall not affect the construction of this Agreement.
SECTION 2 Security Interest.
(a) As security for the payment and performance of the Obligations,
Debtor hereby grants to Secured Party as collateral agent, for itself and for
the ratable benefit of Lenders, a security interest (ranking in first priority,
subject only to the rights of the Office of the Chief Scientist of Israel,
described in s.9.7 and 11.13 of the Convertible Loan Agreement), in all of
Debtor's right, title and interest in, to and under all of its personal
property, wherever located and whether now existing or owned or hereafter
acquired or arising, including all accounts, chattel paper, commercial tort
claims, deposit accounts, documents, equipment (including all fixtures), general
intangibles, instruments, inventory, investment property, letter-of-credit
rights, money and all products, proceeds and supporting obligations of any and
all of the foregoing (collectively, the "Collateral"). Notwithstanding the
foregoing, except for fixtures (to the extent covered by Article 9 of the UCC),
such grant of a security interest shall not extend to, and the term "Collateral"
shall not include, any asset which would be real property under the law of the
jurisdiction in which it is located. The interest of any Lender in the
Collateral shall be on a parity with the interests of all other Lenders, and the
interest of each Lender in the Collateral shall be ratable in the proportion
that the aggregate indebtedness then outstanding and unpaid under the Promissory
Note(s) held by such Lender bears to the aggregate indebtedness then outstanding
and unpaid under the Promissory Notes held by all Lenders (except to the extent
the Lenders agree to any other ratable interest therein). Any Lender holding any
instruments, certificated investment property or other Collateral hereunder
shall do so as agent for Secured Party and for the ratable benefit of all
Lenders.
Notwithstanding anything to the contrary contained in this Agreement, with
respect to provisions contained herein relating to control of Debtor's deposit
accounts or other liquid assets, the Secured Party agrees as follows:
1. Not to make use of any control agreements or rights in the deposit accounts
granted hereunder unless and until an Event of Default has occurred that has not
been cured within the applicable timeframe.
2.
2. Not to make use of any control agreements or rights in the deposit accounts
granted hereunder to the extent that such usage exceeds the Obligations.
3. To first exercise any such rights in the Event of Default with respect to the
deposit account known as the Aim Funds, and only if such funds are not
sufficient to satisfy the Obligations, then to effect such rights vis-a-vis any
other deposit accounts; provided that if Secured Party has reason to believe
that in complying with with clause its rights hereunder may in any way be
harmed, it shall be free to realize on its security in any manner allowed herein
or at law.
(b) Anything herein to the contrary notwithstanding, (i) Debtor
shall remain liable under any contracts, agreements and other documents included
in the Collateral, to the extent set forth therein, to perform all of its duties
and obligations thereunder to the same extent as if this Agreement had not been
executed, (ii) the exercise by Secured Party of any of the rights hereunder
shall not release Debtor from any of its duties or obligations under such
contracts, agreements and other documents included in the Collateral, and (iii)
Secured Party shall not have any obligation or liability under any contracts,
agreements and other documents included in the Collateral by reason of this
Agreement, nor shall Secured Party be obligated to perform any of the
obligations or duties of Debtor thereunder or to take any action to collect or
enforce any such contract, agreement or other document included in the
Collateral hereunder.
(c) This Agreement shall create a continuing security interest in
the Collateral which shall remain in effect until terminated in accordance with
Section 17 hereof.
SECTION 3 Financing Statements, Etc. Debtor shall execute and
deliver to Secured Party concurrently with the execution of this Agreement, and
Debtor hereby authorizes Secured Party to file (with or without Debtor's
signature), at any time and from time to time thereafter, all financing
statements, assignments, continuation financing statements, termination
statements, account control agreements, and other documents and instruments, in
form reasonably satisfactory to Secured Party, and take all other action, as
Secured Party may reasonably request, to perfect and continue perfected,
maintain the priority of or provide notice of the security interest of Secured
Party in the Collateral and to accomplish the purposes of this Agreement.
Without limiting the generality of the foregoing, Debtor ratifies and authorizes
the filing by Secured Party of any financing statements filed prior to the date
hereof. Debtor will cooperate with Secured Party in obtaining control (as
defined in the UCC) of Collateral consisting of deposit accounts, investment
property, letter of credit rights and electronic chattel paper. Debtor will join
with Secured Party in notifying any third party who has possession of any
Collateral of Secured Party's security interest therein and obtaining an
acknowledgment from the third party that it is holding the Collateral for the
benefit of Secured Party. Debtor will not create any chattel paper without
placing a legend on the chattel paper acceptable to Secured Party indicating
that Secured Party has a security interest in the chattel paper.
SECTION 4 Representations and Warranties. Debtor represents and
warrants to Secured Party and each Lender that:
3.
(a) Debtor is duly organized, validly existing and in good standing
under the law of the jurisdiction of its organization and has all requisite
power and authority to execute, deliver and perform its obligations under this
Agreement.
(b) The execution, delivery and performance by Debtor of this
Agreement have been duly authorized by all necessary action of Debtor, and this
Agreement constitutes the legal, valid and binding obligation of Debtor,
enforceable against Debtor in accordance with its terms.
(c) Apart from approval of the Chief Scientist of Israel, no
authorization, consent, approval, license, exemption of, or filing or
registration with, any governmental authority or agency, or approval or consent
of any other Person, is required for the due execution, delivery or performance
by Debtor of this Agreement, except for any filings necessary to perfect any
Liens on any Collateral.
(d) Debtor's chief executive office and principal place of business
(as of the date of this Agreement) is located at the address set forth in
Schedule 1; Debtor's jurisdiction of organization is set forth in Schedule 1;
Debtor's exact legal name is as set forth in the first paragraph of this
Agreement; and all other locations where Debtor conducts business or Collateral
is kept (as of the date of this Agreement) are set forth in Schedule 1.
(e) All of Debtor's U.S. and foreign patents and patent
applications, copyrights (whether or not registered), applications for
copyright, trademarks, service marks and trade names (whether registered or
unregistered), and applications for registration of such trademarks, service
marks and trade names, are set forth in Schedule 2.
(f) No control agreements exist with respect to any Collateral other
than control agreements in favor of Secured Party.
(g) Debtor does not have or hold any chattel paper, letter-of-credit
rights or commercial tort claims except as disclosed to Secured Party.
(h) The names and addresses of all financial institutions and other
Persons at which Debtor maintains its deposit and securities accounts, and the
account numbers and account names of such accounts, are set forth in Schedule 1.
SECTION 5 Covenants. So long as any of the Obligations remain
unsatisfied, Debtor agrees that:
(a) Debtor shall give prompt written notice to Secured Party (and in
any event not later than 30 days following any change described below in this
subsection) of: (i) any change in the location of Debtor's chief executive
office or principal place of business; (ii) any change in the locations where
Debtor conducts business or Collateral is kept at locations set forth in
Schedule 1; (iii) any change in its name; (iv) any changes in its identity or
structure in any manner which might make any financing statement filed hereunder
incorrect or misleading; (v) any change in its registration as an organization
(or any new such registration); or (vi) any change in its jurisdiction of
organization; provided that Debtor shall not locate any Collateral
4.
outside of California nor shall Debtor change its jurisdiction of organization
to a jurisdiction outside of either the United States or Israel.
(b) Upon the request of Secured Party, Debtor shall (i) immediately
deliver to Secured Party, or an agent designated by it, appropriately endorsed
or accompanied by appropriate instruments of transfer or assignment, all
documents and instruments, all certificated securities with respect to any
investment property, all letters of credit and, upon an Event of Default that
has not been cured within the applicable timeframe, all accounts and other
rights to payment at any time evidenced by promissory notes , trade acceptances
or other instruments, (ii) cause any securities intermediaries to show on their
books that Secured Party is a first priority secured party with respect to any
investment property, and/or obtain account control agreements in favor of
Secured Party from such securities intermediaries, in form and substance
satisfactory to Secured Party, with respect to any investment property, as
requested by Secured Party, and (iii) provide such notice, obtain such
acknowledgments and take all such other action, with respect to any chattel
paper, documents and letter-of credit rights, as Secured Party shall reasonably
specify.
(c) Debtor shall immediately notify Secured Party if Debtor holds or
acquires (i) any commercial tort claims, (ii) any chattel paper, including any
interest in any electronic chattel paper, or (iii) any letter-of-credit rights.
SECTION 6 Authorization; Secured Party Appointed Attorney-in-Fact.
Secured Party shall have the right to, in the name of Debtor, or in
the name of Secured Party or otherwise, upon notice to but without the
requirement of assent by Debtor, and Debtor hereby constitutes and appoints
Secured Party (and any of Secured Party's officers, employees or agents
designated by Secured Party) as Debtor's true and lawful attorney-in-fact, with
full power and authority to: (i) sign and file any of the financing statements
and other documents and instruments which must be executed or filed to perfect
or continue perfected, maintain the priority of or provide notice of Secured
Party's security interest in the Collateral (including any notices to or
agreements with any securities intermediary); (ii) upon an Event of Default that
has not been cured within the applicable timeframe, assert, adjust, ▇▇▇ for,
compromise or release any claims under any policies of insurance; (iii) give
notices of control, default or exclusivity (or similar notices) under any
account control agreement or similar agreement with respect to exercising
control over deposit accounts or securities accounts; and (iv) execute any and
all such other documents and instruments, and do any and all acts and things for
and on behalf of Debtor, which Secured Party may deem reasonably necessary or
advisable to maintain, protect, realize upon and preserve the Collateral and
Secured Party's security interest therein and to accomplish the purposes of this
Agreement. Secured Party agrees that, except upon and during the continuance of
an Event of Default, it shall not exercise the power of attorney, or any rights
granted to Secured Party, pursuant to clauses (ii), (iii) and (iv). The
foregoing power of attorney is coupled with an interest and irrevocable so long
as the Obligations have not been paid and performed in full. Debtor hereby
ratifies, to the extent permitted by law, all that Secured Party shall lawfully
and in good faith do or cause to be done by virtue of and in compliance with
this Section 7.
5.
SECTION 7 Remedies.
(a) Upon the occurrence and continuance of any Event of Default (as
defined in the Promissory Notes), Secured Party shall have, in addition to all
other rights and remedies granted to it in this Agreement, the Promissory Notes
or any other Document, all rights and remedies of a secured party under the UCC
and other applicable laws. Without limiting the generality of the foregoing, (i)
Secured Party may peaceably and without notice enter any premises of Debtor,
take possession of any the Collateral, remove or dispose of all or part of the
Collateral on any premises of such Debtor or elsewhere, or, in the case of
equipment, render it nonfunctional, and otherwise collect, receive, appropriate
and realize upon all or any part of the Collateral, and demand, give receipt
for, settle, renew, extend, exchange, compromise, adjust, or ▇▇▇ for all or any
part of the Collateral, as Secured Party may determine; (ii) Secured Party may
require any Debtor to assemble all or any part of the Collateral and make it
available to Secured Party at any place and time designated by Secured Party;
(iii) Secured Party may secure the appointment of a receiver of the Collateral
or any part thereof (to the extent and in the manner provided by applicable
law); (iv) Secured Party may sell, resell, lease, use, assign, license,
sublicense, transfer or otherwise dispose of any or all of the Collateral in its
then condition or following any commercially reasonable preparation or
processing (utilizing in connection therewith any of Debtor's assets, without
charge or liability to Secured Party therefor) at public or private sale, by one
or more contracts, in one or more parcels, at the same or different times, for
cash or credit, or for future delivery without assumption of any credit risk,
all as Secured Party deems advisable; provided, however, that Debtor shall be
credited with the net proceeds of sale only when such proceeds are finally
collected by Secured Party.Secured Party and each Lender shall have the right
upon any such public sale, and, to the extent permitted by law, upon any such
private sale, to purchase the whole or any part of the Collateral so sold, free
of any right or equity of redemption, which right or equity of redemption Debtor
hereby releases, to the extent permitted by law. Secured Party shall give Debtor
such notice of any private or public sales as may be required by the UCC or
other applicable law.
(b) For the purpose of enabling Secured Party to exercise its rights
and remedies under this Section 7 or otherwise in connection with this Agreement
in the Event of Default, Debtor hereby grants to Secured Party an irrevocable,
non-exclusive and assignable license (exercisable without payment or royalty or
other compensation to Debtor) to use, license or sublicense any intellectual
property Collateral, subject to compliance with obligations of the Debtor
towards the Chief Scientist of the State of Israel. Nothing herein derogates
from any rights the Secured Party may have under any separate security document
relating to intellectual party.
(c) Neither Secured Party nor any Lender shall have any obligation
to clean up or otherwise prepare the Collateral for sale. Secured Party has no
obligation to attempt to satisfy the Obligations by collecting them from any
other Person liable for them, and Secured Party and Lenders may release, modify
or waive any Collateral provided by any other Person to secure any of the
Obligations, all without affecting Secured Party's or any Lender's rights
against Debtor. Debtor waives any right it may have to require Secured Party or
any Lender to pursue any third Person for any of the Obligations. Secured Party
and Lenders will comply with any applicable state or federal law requirements in
connection with a disposition of the Collateral and compliance will not be
considered adversely to affect the commercial reasonableness of any
6.
sale of the Collateral. Secured Party may sell the Collateral without giving any
warranties as to the Collateral. Secured Party may specifically disclaim any
warranties of title or the like. This procedure will not be considered adversely
to affect the commercial reasonableness of any sale of the Collateral. If
Secured Party sells any of the Collateral upon credit, Debtor will be credited
only with payments actually made by the purchaser, received by Secured Party and
applied to the indebtedness of the purchaser. In the event the purchaser fails
to pay for the Collateral, Secured Party shall act in a commercially reasonable
fashion and either proceed against the purchaser for collection of the unpaid
amounts and/or may resell the Collateral and in either event Debtor's obligation
to Secured Party shall be reduced by an amount equal to the the net proceeds of
the sale.
(d) The cash proceeds actually received from the sale or other
disposition or collection of Collateral, and any other amounts received in
respect of the Collateral the application of which is not otherwise provided for
herein, shall be applied first, to the payment of the reasonable costs and
expenses of Secured Party in exercising or enforcing its rights hereunder and in
collecting or attempting to collect any of the Collateral, and to the payment of
all other amounts payable to Secured Party pursuant to Section 13 hereof; and
second, to the payment of the Obligations. Any surplus thereof which exists
after payment and performance in full of the Obligations shall be promptly paid
over to Debtor or otherwise disposed of in accordance with the UCC or other
applicable law. Debtor shall remain liable to Secured Party, as collateral
agent, and each Lender, for any deficiency which exists after any sale or other
disposition or collection of Collateral.
(e) In taking any action under this Section 7 or otherwise taking
action as collateral agent on behalf of Lenders and exercising such powers and
performing such duties under this Agreement as are granted to Secured Party
hereunder, except to the extent otherwise provided under the Documents, Secured
Party shall act in each case in accordance with the instructions of the Lender
Majority.
SECTION 8 Certain Waivers Debtor waives, to the fullest extent
permitted by law, (i) any right of redemption with respect to the Collateral,
whether before or after sale hereunder, and all rights, if any, of marshalling
of the Collateral or other collateral or security for the Obligations; (ii) any
right to require Secured Party (A) to proceed against any Person, (B) to exhaust
any other collateral or security for any of the Obligations, (C) to pursue any
remedy in Secured Party's power, or (D) to make or give any presentments,
demands for performance, notices of nonperformance, protests, notices of
protests or notices of dishonor in connection with any of the Collateral; and
(iii) all claims, damages, and demands against Secured Party or any Lender
arising out of the repossession, retention, sale or application of the proceeds
of any sale of the Collateral, to the extent that Secured Party has acted in a
commercially reasonable manner vis-a-vis the Collateral,. However, nothing
herein requires Secured Party to act in a fiduciary manner vis a vis the Debtor
or its shareholders.
SECTION 9 Notices. All notices or other communications hereunder
shall be in writing (including by facsimile transmission or by email) and
mailed, sent or delivered to the respective parties hereto at or to their
respective addresses, facsimile numbers or email addresses set forth below their
names on the signature pages hereof, or at or to such other address, facsimile
number or email address as shall be designated by any party in a written notice
to the
7.
other parties hereto. All such notices and other communications shall be deemed
to be delivered when a record (within the meaning of the UCC) has been (i)
delivered by hand; (ii) sent by mail upon the earlier of the date of receipt or
five business days after deposit in the mail, first class (or air mail as to
communications sent to or from the United States); (iii) sent by facsimile
transmission; or (iv) sent by email.
SECTION 10 No Waiver; Cumulative Remedies. No failure on the part of
Secured Party or any Lender to exercise, and no delay in exercising, any right,
remedy, power or privilege hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any such right, remedy, power or
privilege preclude any other or further exercise thereof or the exercise of any
other right, remedy, power or privilege. The rights and remedies under this
Agreement are cumulative and not exclusive of any rights, remedies, powers and
privileges that may otherwise be available to Secured Party and the Lenders.
SECTION 11 Costs and Expenses.
(a) Debtor agrees to pay on demand all reasonable costs and expenses
of Secured Party and each Lender, and the fees and disbursements of counsel, in
connection with the enforcement or attempted enforcement of, and preservation of
any rights or interests under, this Agreement and the Promissory Notes,
including in any out-of-court workout or other refinancing or restructuring or
in any bankruptcy case, and the protection, sale or collection of, or other
realization upon, any of the Collateral, including all expenses of taking,
collecting, holding, sorting, handling, preparing for sale, selling, or the
like, and other such expenses of sales and collections of Collateral.
(b) Any amounts payable to Secured Party and the Lenders under this
Section 11 or otherwise under this Agreement if not paid upon demand shall bear
interest from the date of such demand until paid in full, at the default rate of
interest set forth in the Promissory Notes.
SECTION 12 Binding Effect. This Agreement shall be binding upon,
inure to the benefit of and be enforceable by Debtor, Secured Party, each Lender
and their respective successors and assigns and shall bind any Person who
becomes bound as a debtor to this Agreement. Debtor may not assign, transfer,
hypothecate or otherwise convey its rights, benefits, obligations or duties
hereunder without the prior express written consent of Secured Party, as
collateral agent, and Lenders. Any such purported assignment, transfer,
hypothecation or other conveyance by Debtor without the prior express written
consent of Secured Party, as collateral agent, and Lenders shall be void.
SECTION 13 Governing Law.
(a) This Agreement shall be governed by, and construed in accordance
with, the law of the State of California, except as required by mandatory
provisions of law and to the extent the validity or perfection of the security
interests hereunder, or the remedies hereunder, in respect of any Collateral are
governed by the law of a jurisdiction other than California.
(b) Debtor hereby (i) submits to the non-exclusive jurisdiction of
the courts of the State of California and the Federal courts of the United
States sitting in the State of
8.
California for the purpose of any action or proceeding arising out of or
relating to the Documents, (ii) agrees that all claims in respect of any such
action or proceeding may be heard and determined in such courts, (iii)
irrevocably waives (to the extent permitted by applicable law) any objection
which it now or hereafter may have to the laying of venue of any such action or
proceeding brought in any of the foregoing courts, and any objection on the
ground that any such action or proceeding in any such court has been brought in
an inconvenient forum and (iv) agrees that a final judgment in any such action
or proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner permitted by law.
SECTION 14 Entire Agreement; Amendment. This Agreement contains the
entire agreement of the parties with respect to the subject matter hereof. No
amendment or waiver of any provision of this Agreement nor consent to any
departure therefrom by Debtor shall in any event be effective unless the same
shall be in writing and signed by Secured Party (with the consent of the Lender
Majority), and then such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given; provided,
however, that no amendment, waiver or consent shall, unless in writing and
signed by Secured Party, affect the rights, duties or obligations of Secured
Party under or in respect of this Agreement.
SECTION 15 Severability. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
all applicable laws and regulations. If, however, any provision of this
Agreement shall be prohibited by or invalid under any such law or regulation in
any jurisdiction, it shall, as to such jurisdiction, be deemed modified to
conform to the minimum requirements of such law or regulation, or, if for any
reason it is not deemed so modified, it shall be ineffective and invalid only to
the extent of such prohibition or invalidity without affecting the remaining
provisions of this Agreement, or the validity or effectiveness of such provision
in any other jurisdiction.
SECTION 16 Counterparts. This Agreement may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and all of
which taken together shall constitute but one and the same agreement.
SECTION 17 Termination. Upon payment and performance in full of all
Obligations, and / or full repayment and / or conversion by all Secured Parties
and/or (if a Secured Party declines to convert or be repaid upon an event as
described in section 4.4 of the Promissory Note), the expiry of 12 months from
the date of the request to convert or be repaid, by Debtor to the declining
Secured Party, the security interest created under this Agreement shall
terminate and Secured Party shall promptly execute and deliver to Debtor such
documents and instruments reasonably requested by Debtor as shall be necessary
to evidence termination of all security interests given by Debtor to Secured
Party hereunder.
9.
SECTION 18 Conflicts. In the event of any conflict or inconsistency
between this Agreement and the Debenture, the terms of this Agreement shall
control.
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement, as of the date first above written.
COMMTOUCH SOFTWARE LTD. XDL CAPITAL CORP., as Secured Party
By___________________________ By_________________________________
Title: CEO Title:_____________________________
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇ Attn:
Fax: ▇▇▇-▇▇▇-▇▇▇▇ Fax:
email:
10.
ANNEX 1
AxcessNet Resources LLC.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ (▇▇▇▇▇ ▇▇▇▇), ▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇
Compugen Systems Ltd.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Delta Capital Ltd.
▇▇▇-▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇
KKB Ventures LLC
Attn: ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇▇,▇▇. ▇▇▇▇▇
XDL Capital Corp.
▇▇ ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇. ▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇, ASO & ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇ Professor of the Management of Technology
MIT ▇▇▇▇▇ School of Management
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
LENE L.P.
c/o ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, General Partner
▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇.
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
2.
SCHEDULE 1
to the Security Agreement
1. Jurisdiction of Organization Israel
2. Chief Executive Office and Principal Place of Business ▇ ▇▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇
3. Other locations where Debtor conducts business or Collateral is kept N/A
4. Deposit Accounts and Security Accounts XXXX
S-1.
SCHEDULE 2
to the Security Agreement
1. Patents and Patent Applications.
Provisional Patent Application filed with USPTO on or about December
26, 2002 with the USPTO for "Prevention Of Bulk Transmission Of Objects In A
Communication Network"
2. Copyrights (Registered and Unregistered) and Copyright Applications. N/A
3. Trademarks, Service Marks and Trade Names and Trademark, Service ▇▇▇▇ and
Trade Name Applications. "COMMTOUCH"
S-2.