EXHIBIT 10.3
COLLATERAL ASSIGNMENT
THIS COLLATERAL ASSIGNMENT is made and entered into on October 12, 2005 by
OXFORD VENTURES, INC. ("Assignor"), in favor of the undersigned Buyers listed on
Schedule I attached hereto (collectively, the "Assignee").
WITNESSETH:
WHEREAS, the Assignor and Uluru, Inc. (the "Company") have agreed upon the
terms and conditions of a merger and related trasnactions (the "Merger"), as set
forth in the Term Sheet attached hereto as Exhibit A;
WHEREAS, simultaneusly herewith the Assignor and the Assignee have entered
into a Securities Purchase Agreement ("Securities Purchase Agreement") pursuant
to which the Assignor shall issue and the Assignee shall purchase Convertible
Debentures in an amount up to $15,000,000 (the "Debentures");
WHEREAS, to provide the Company with sufficient working capital to enable
the Company to acquire certain pharmaceutical assets while the Assignor and the
Company prepare the documentation necessary and appropriate to consumate the
Merger and obtain all necessary approvals from stockholders and third parties,
the Assginor has agreed to loan certain of the proceeds of the Debenture to the
Company as evidenced by the Promissory Note dated the date hereof (the
"Promissory Note"); and
WHEREAS, in order to secure the Company's obligations under the Promissory
Note on the date hereof the Company, Xxxxx X. Xxxx, the controlling shareholder
of the Company (the "Shareholder"), and the Assignor have entered into a Bridge
Loan and Control Share Pledge and Security Agreement, a Pledge and Escrow
Agreement, and a Security Agreement (collectively referred to as the "Promissory
Note Security Documents" which collectively with the Promissory Note are
attached hereto as Schedule II) pursuant to which (i) the Shareholder has agreed
to pledge to the Assignor the Borrower Control Shares (as defined in the Pledge
and Escrow Agreement) which will constitute 54.5 % of the outstanding capital
stock of the Assignor on a fully-diluted basis, (ii) the Assignor agreed not to
issue any additional shares of capital stock, and (iii) the Company has granted
the Assignor a security interest in and to the Collateral (as defined in the
Security Agreement).
NOW, THEREFORE, in consideration of the promises and covenants contained
herein and other good and valuable consideration, the receipt and sufficiency of
which are acknowledged by the Assignor, and intending to be legally bound,
Assignor assigns to Assignee all of its right, title and interest in and to the
Promissory Note Security Documents to the fullest extent permitted by law.
1. Except as otherwise expressly provided herein, capitalized terms
used in this Assignment shall have the respective meanings given to them in the
Promissory Note Security Documents.
2. Assignor has granted, bargained, sold, assigned, transferred and set
over and by these presents does hereby grant, bargain, sell, assign, transfer,
grant a security interest in and set over unto Assignee, its respective
successors and assigns, all the rights, interests and privileges which Assignor
has or may have in or under the Promissory Note Security Documents, including
without limiting the generality of the foregoing, the present and continuing
right with full power and authority, in its own name, or in the name of
Assignor, or otherwise, but subject to the provisions and limitations of Section
3 hereof, (i) to make claim for, enforce, perform, collect and receive any and
all rights under the Promissory Note Security Documents, (ii) to do any and all
things which Assignor is or may become entitled to do under the Promissory Note,
and (iii) to make all waivers and agreements, give all notices, consents and
releases and other instruments and to do any and all other things whatsoever
which Assignor is or may become entitled to do under the Promissory Note
Security Documents.
3. The acceptance of this Assignment and the payment or performance
under the Promissory Note Security Documents shall not constitute a waiver of
any rights of Assignee under the terms of the Promissory Note Security
Documents, it being understood that, until the occurrence of a default under the
Promissory Note Security Documents, and the exercise of Assignee's rights under
Section 4 hereof, Assignor shall have all rights to the Promissory Note Security
Documents and to retain, use and enjoy the same.
4. Assignor, upon the occurrence of a payment default under the
Promissory Note, hereby authorizes Assignee, at Assignee's option, to enforce
and exercise all rights and privileges with respect to the Promissory Note
Security Documents that, pursuant to Schedule II, is associated with the payment
which is in default. Assignor does hereby irrevocably constitute and appoint
Prenox, LLC (the "Collateral Agent"), while this Assignment remains in force and
effect and, in each instance, to the full extent permitted by applicable Law,
its true and lawful attorney in fact, coupled with an interest and with full
power of substitution and revocation, for Assignor and in its name, place and
stead, to demand and enforce compliance with all the terms and conditions of the
Promissory Note Security Documents and all benefits accrued thereunder, whether
at law, in equity or otherwise; provided, however, that Assignee shall not
exercise any such power unless and until a default in the payment associated
with that contract shall have occurred. Assignor acknowledges and agrees that
(i) the power of attorney herein granted shall in no way be construed as to
benefit Assignor; and (ii) the Collateral Agent is granted this power of
attorney shall have no duty to exercise any powers granted hereunder for the
benefit of Assignor. The Collateral Agent hereby accepts this power of attorney
and all powers granted hereunder for the benefit of the Assignee.
5. Assignee shall not be obligated to perform or discharge any
obligation or duty to be performed or discharged by Assignor under the
Promissory Note Security Documents, and Assignor hereby agrees to indemnify
Assignee for, and to save Assignee harmless from, any and all liability arising
under the Promissory Note Security Documents, other than arising or resulting
from Assignee's (or its agents, employees or contractors) gross negligence or
willful misconduct.
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6. Assignor agrees that this Assignment and the designation and
directions herein set forth are irrevocable.
7. Neither this Assignment nor any action or inaction on the part of
Assignee shall constitute an assumption on the part of Assignee of any
obligations or duties under the Promissory Note Security Documents.
8. Assignor covenants and warrants that:
(a) it has the power and authority to assign the Promissory Note
Security Documents and there have been no prior assignments of the Promissory
Note Security Documents;
(b) the Promissory Note Security Documents are, and shall be,
valid contracts, and that there are and shall be, to Assignor's knowledge, no
defaults on the part of any of the parties thereto;
(c) it will not assign, pledge or otherwise encumber the
Promissory Note Security Documents without the prior written consent of
Assignee;
(d) it will not cancel, terminate or accept any surrender of the
Promissory Note Security Documents, or amend or modify the same directly or
indirectly in any respect whatsoever, without having obtained the prior written
consent of the Assignee thereto;
(e) it will perform and observe, or cause to be performed and
observed, all of the terms, covenants and conditions on its part to be performed
and observed with respect to the Bio-One Debenture; and
(f) it will execute from time to time any and all additional
assignments or instruments of further assurance to Assignee, as Assignee may at
any time reasonably request.
9. Assignor shall have the right, from time to time, to substitute new
assigned contracts for the Promissory Note Security Documents on Schedule II so
long as the substitute contracts provide for a purchase price equal to or
greater than the Promissory Note to be released. Upon any such substitution, the
parties hereto shall confirm the substitution in writing and shall replace
Schedule II with a new Schedule reflecting updated Promissory Note.
10. At such time as the Convertible Debenture is satisfied or
discharged, this Assignment and all of Assignee's right, title and interest
hereunder with respect to the Promissory Note Security Documents shall
terminate.
11. This Assignment shall inure to the benefit of Assignee, and its
successors and assigns, and shall be binding upon Assignor, and its successors,
and assigns.
12. This Agreement shall be governed by and construed in accordance with
the internal laws of the State of New York without regard to its conflicts of
law principles.
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13. 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 an original and all of which taken together shall
constitute but one and the same agreement. Assignor acknowledges and agrees that
a telecopy transmission to Assignee of signature pages hereof purporting to be
signed on behalf of Assignor shall constitute effective and binding execution
and delivery hereof by Assignor.
[SIGNATURE PAGE FOLLOWS]
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[SIGNATURE PAGE 1 OF 2 TO
COLLATERAL ASSIGNMENT]
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed under seal by their respective officers or agents thereunto duly
authorized, as of the date first above written.
OXFORD VENTURES, INC.
By: /s/ Xxxxxx Xxxxxxx
--------------------------------------------
Name: Xxxxxx Xxxxxxx
Title: President and Chief Executive Officer
[SIGNATURE PAGE 2 OF 2 TO
COLLATERAL ASSIGNMENT]
SCHEDULE I
SCHEDULE OF BUYERS
ADDRESS/FACSIMILE
NAME SIGNATURE NUMBER OF INVESTORS
-------------------------- ------------------------------------- -------------------------------
Highgate House Funds, Ltd. By: /s/ Xxxx X. Xxxxxxxxxx
-------------------------------- 000 Xxxxxxx Xxxxxx
Name: Xxxx X. Xxxxxxxxxx New York, NY 10022
Its: Portfolio Manager Facsimile: (000) 000-0000
With a copy to: Xxxx Xxxxx, Esq. 000 Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Prenox, LLC By: /s/ Xxxxxxx Xxxxx
-------------------------------- 000 Xxxxx Xxxxxx, 00xx Xxxxx
Name: Xxxxxxx Xxxxx Xxx Xxxx, XX 00000
Its: Telephone: (000) 000-0000
Facsimile: (000) 000-0000
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SCHEDULE II
PROMISSORY NOTE SECURITY DOCUMENTS AND PROMISSORY NOTE
EXHIBIT A
TERM SHEET
