Borrower agrees to indemnify , defend and hold Agent and Lenders and their respective directors , officers , employees , agents , attorneys , or any other Person affiliated with or representing Agent or any Lender ( each , an " Indemnified Person ") harmless against : ( a ) all obligations , demands , claims , and liabilities ( collectively , " Claims ") asserted by any other party in connection with the transactions contemplated by the Loan Documents ; and ( b ) all losses or Lenders ' Expenses incurred , or paid by Lenders and / or Agent from , following , or arising from transactions between Lenders and Borrower ( including reasonable attorneys ' fees and expenses ), except for Claims and / or losses directly caused by an Indemnified Person ' s gross negligence or willful misconduct .

<response> <person>Borrower</person> agrees to indemnify , defend and hold Agent and Lenders and their respective directors , officers , employees , agents , attorneys , or any other Person affiliated with or representing Agent or any <person>Lender</person> ( each , an " Indemnified Person ") harmless against : ( a ) all obligations , demands , claims , and liabilities ( collectively , " Claims ") asserted by any other party in connection with the transactions contemplated by the Loan Documents ; and ( b ) all losses or Lenders ' Expenses incurred , or paid by Lenders and / or Agent from , following , or arising from transactions between Lenders and <person>Borrower</person> ( including reasonable attorneys ' fees and expenses ), except for Claims and / or losses directly caused by an Indemnified Person ' s gross negligence or willful misconduct . </response>


12 . 3 Time of Essence .

<response> 12 . 3 Time of Essence . </response>


<response> Time is of the essence for the performance of all Obligations in this Agreement . </response>


12 . 4 Severability of Provisions .

<response> 12 . 4 Severability of Provisions . </response>


<response> Each provision of this Agreement is severable from every other provision in determining the enforceability of any provision . </response>


<response> 12 . 5 Amendments in Writing ; Integration . </response>


All amendments to this Agreement must be in writing signed by Agent , Lenders and Borrower .

<response> All amendments to this Agreement must be in writing signed by Agent , Lenders and <person>Borrower</person> . </response>


<response> This Agreement and the Loan Documents represent the entire agreement about this subject matter and supersede prior negotiations or agreements . </response>


<response> All prior agreements , understandings , representations , warranties , and negotiations between the parties about the subject matter of this Agreement and the Loan Documents merge into this Agreement and the Loan Documents . </response>


12 . 6 Counterparts .

<response> 12 . 6 Counterparts . </response>


<response> This Agreement may be executed in any number of counterparts and by different parties on separate counterparts , each of which , when executed and delivered , is an original , and all taken together , constitute one Agreement . </response>


12 . 7 Survival .

<response> 12 . 7 Survival . </response>


<response> All covenants , representations and warranties made in this Agreement continue in full force until this Agreement has terminated pursuant to its terms and all Obligations ( other than inchoate indemnity obligations and any other obligations which , by their terms , are to survive the termination of this Agreement ) have been satisfied . </response>


The obligation of Borrower in Section 12 . 2 to indemnify each Lender and Agent shall survive until the statute of limitations with respect to such claim or cause of action shall have run .

<response> The obligation of <person>Borrower</person> in Section 12 . 2 to indemnify each <person>Lender</person> and Agent shall survive until the statute of limitations with respect to such claim or cause of action shall have run . </response>


- 14 - 12 . 8 Confidentiality .

<response> - 14 - 12 . 8 Confidentiality . </response>


In handling any confidential information of Borrower , Agent and Lenders shall exercise the same degree of care that they exercise for their own proprietary information , but disclosure of information may be made : ( a ) to Agent ' s and Lenders ' Subsidiaries or Affiliates ( provided that such Subsidiaries or Affiliates shall abide by the terms of this provision ); ( b ) to prospective transferees or purchasers of any interest in the Credit Extensions ( provided , however , Agent and Lenders shall use commercially reasonable efforts to obtain such prospective transferee ' s or purchaser ' s agreement to the terms of this provision ); ( c ) as required by law , regulation , subpoena , or other order ; ( d ) to Agent ' s and Lenders ' regulators or as otherwise required in connection with Agent ' s and Lenders ' examination or audit ; and ( e ) as Agent considers appropriate in exercising remedies under this Agreement .

<response> In handling any confidential information of <person>Borrower</person> , Agent and Lenders shall exercise the same degree of care that they exercise for their own proprietary information , but disclosure of information may be made : ( a ) to Agent ' s and Lenders ' Subsidiaries or Affiliates ( provided that such Subsidiaries or Affiliates shall abide by the terms of this provision ); ( b ) to prospective transferees or purchasers of any interest in the Credit Extensions ( provided , however , Agent and Lenders shall use commercially reasonable efforts to obtain such prospective transferee ' s or purchaser ' s agreement to the terms of this provision ); ( c ) as required by law , regulation , subpoena , or other order ; ( d ) to Agent ' s and Lenders ' regulators or as otherwise required in connection with Agent ' s and Lenders ' examination or audit ; and ( e ) as Agent considers appropriate in exercising remedies under this Agreement . </response>


<response> Confidential information does not include information that either : ( i ) is in the public domain or in Agent ' s and / or Lenders ' possession when disclosed to Agent and / or Lenders , or becomes part of the public domain after disclosure to Agent and / or Lenders , through no fault of Agent or Lenders ; or ( ii ) is disclosed to Agent and / or Lenders by a third party , if Agent and / or Lenders does not know that the third party is prohibited from disclosing the information . </response>


12 . 9 Right of Set Off .

<response> 12 . 9 Right of Set Off . </response>


Borrower hereby grants to Agent for the ratable benefit of Lenders , and to each Lender , a lien , security interest and right of set off as security for all Obligations to Agent and each Lender , whether now existing or hereafter arising upon and against all deposits , credits , collateral and property , now or hereafter in the possession , custody , safekeeping or control of Agent or any entity under the control of Agent ( including an Agent subsidiary ) or in transit to any of them .

<response> <person>Borrower</person> hereby grants to Agent for the ratable benefit of Lenders , and to each <person>Lender</person> , a lien , security interest and right of set off as security for all Obligations to Agent and each <person>Lender</person> , whether now existing or hereafter arising upon and against all deposits , credits , collateral and property , now or hereafter in the possession , custody , safekeeping or control of Agent or any entity under the control of Agent ( including an Agent subsidiary ) or in transit to any of them . </response>


At any time after the occurrence and during the continuance of an Event of Default , without demand or notice , Agent or Lenders , as appropriate , may set off the same or any part thereof and apply the same to any liability or obligation of Borrower even though unmatured and regardless of the adequacy of any other collateral securing the Obligations .

<response> At any time after the occurrence and during the continuance of an Event of Default , without demand or notice , Agent or Lenders , as appropriate , may set off the same or any part thereof and apply the same to any liability or obligation of <person>Borrower</person> even though unmatured and regardless of the adequacy of any other collateral securing the Obligations . </response>


ANY AND ALL RIGHTS TO REQUIRE AGENT TO EXERCISE ITS RIGHTS OR REMEDIES WITH RESPECT TO ANY OTHER COLLATERAL WHICH SECURES THE OBLIGATIONS , PRIOR TO EXERCISING ITS RIGHT OF SETOFF WITH RESPECT TO SUCH DEPOSITS , CREDITS OR OTHER PROPERTY OF BORROWER ARE HEREBY KNOWINGLY , VOLUNTARILY AND IRREVOCABLY WAIVED .

<response> ANY AND ALL RIGHTS TO REQUIRE AGENT TO EXERCISE ITS RIGHTS OR REMEDIES WITH RESPECT TO ANY OTHER COLLATERAL WHICH SECURES THE OBLIGATIONS , PRIOR TO EXERCISING ITS RIGHT OF SETOFF WITH RESPECT TO SUCH DEPOSITS , CREDITS OR OTHER PROPERTY OF <person>BORROWER</person> ARE HEREBY KNOWINGLY , VOLUNTARILY AND IRREVOCABLY WAIVED . </response>


13 DEFINITIONS 13 . 1 Definitions .

<response> 13 DEFINITIONS 13 . 1 Definitions . </response>


As used in this Agreement , the following terms have the following meanings : " Account " is any " account " as defined in the Code with such additions to such term as may hereafter be made , and includes , without limitation , all accounts receivable and other sums owing to Borrower .

<response> As used in this Agreement , the following terms have the following meanings : " Account " is any " account " as defined in the Code with such additions to such term as may hereafter be made , and includes , without limitation , all accounts receivable and other sums owing to <person>Borrower</person> . </response>


<response> " Account Debtor " is any " account debtor " as defined in the Code with such additions to such term as may hereafter be made . </response>


<response> " Affiliate " of any Person is a Person that owns or controls directly or indirectly the Person , any Person that controls or is controlled by or is under common control with the Person , and each of that Person ' s senior executive officers , directors , partners and , for any Person that is a limited liability company , that Person ' s managers and members . </response>


<response> " Agent " means , SVB , not in its individual capacity , but solely in its capacity as agent on behalf of and for the benefit of the Lenders . </response>


<response> " Agreement " is defined in the preamble hereof . </response>


<response> " Amortization Date " shall mean , for each Term Loan , the earlier of ( i ) the first Payment Date following the date which is six ( 6 ) months from the Funding Date of such Term Loan , or ( ii ) April 1 , 2009 . </response>


<response> " Amortization Schedule " as to each Term Loan , is a period of time equal to : ( a ) beginning on the applicable Amortization Date and for the following eleven ( 11 ) months , an amortization schedule of forty - eight ( 48 ) consecutive months ; ( b ) beginning on the first anniversary of the applicable Amortization Date and for the following eleven ( 11 ) months , an amortization schedule of thirty - six ( 36 ) consecutive months ; and </response>


<response> - 15 - ( c ) beginning on the second anniversary of the applicable Amortization Date through the applicable Maturity Date , an amortization schedule of twenty - four ( 24 ) consecutive months . </response>


" Board " means Borrower ' s board of directors .

<response> " Board " means <person>Borrower</person> ' s board of directors . </response>


" Borrower " is defined in the preamble hereof .

<response> " <person>Borrower</person> " is defined in the preamble hereof . </response>


" Borrower ' s Books " are all Borrower ' s books and records including ledgers , federal and state tax returns , records regarding Borrower ' s assets or liabilities , the Collateral , business operations or financial condition , and all computer programs or storage or any equipment containing such information .

<response> " <person>Borrower</person> ' s Books " are all <person>Borrower</person> ' s books and records including ledgers , federal and state tax returns , records regarding <person>Borrower</person> ' s assets or liabilities , the Collateral , business operations or financial condition , and all computer programs or storage or any equipment containing such information . </response>


<response> " Borrowing Resolutions " are , with respect to any Person , those resolutions adopted by such Person ' s Board of Directors and delivered by such Person to Agent approving the Loan Documents to which such Person is a party and the transactions contemplated thereby , together with a certificate executed by its secretary on behalf of such Person certifying that ( a ) such Person has the authority to execute , deliver , and perform its obligations under each of the Loan Documents to which it is a party , ( b ) that attached as Exhibit A to such certificate is a true , correct , and complete copy of the resolutions then in full force and effect authorizing and ratifying the execution , delivery , and performance by such Person of the Loan Documents to which it is a party , ( c ) the name ( s ) of the Person ( s ) authorized to execute the Loan Documents on behalf of such Person , together with a sample of the true signature ( s ) of such Person ( s ), and ( d ) that Agent and Lenders may conclusively rely on such certificate unless and until such Person shall have delivered to Agent a further certificate canceling or amending such prior certificate . </response>


<response> " Business Day " is any day that is not a Saturday , Sunday or a day on which Agent is closed . </response>


" Cash Equivalents " are ( a ) marketable direct obligations issued or unconditionally guaranteed by the United States or any agency or any State thereof having maturities of not more than one ( 1 ) year from the date of acquisition ; ( b ) commercial paper maturing no more than one ( 1 ) year after its creation and having the highest rating from either Standard & Poor ' s Ratings Group or Moody ' s Investors Service , Inc ., and ( c ) Agent ' s certificates of deposit issued maturing no more than one ( 1 ) year after issue .

<response> " Cash Equivalents " are ( a ) marketable direct obligations issued or unconditionally guaranteed by the <location>United States</location> or any agency or any State thereof having maturities of not more than one ( 1 ) year from the date of acquisition ; ( b ) commercial paper maturing no more than one ( 1 ) year after its creation and having the highest rating from either Standard & Poor ' s Ratings Group or Moody ' s Investors Service , Inc ., and ( c ) Agent ' s certificates of deposit issued maturing no more than one ( 1 ) year after issue . </response>


<response> " Claims " are defined in Section 12 . 2 . </response>


" Code " is the Uniform Commercial Code , as the same may , from time to time , be enacted and in effect in the Commonwealth of Massachusetts ; provided , that , to the extent that the Code is used to define any term herein or in any Loan Document and such term is defined differently in different Articles or Divisions of the Code , the definition of such term contained in Article or Division 9 shall govern ; provided further , that in the event that , by reason of mandatory provisions of law , any or all of the attachment , perfection , or priority of , or remedies with respect to , Agent ' s and Lenders ' Lien on any Collateral is governed by the Uniform Commercial Code in effect in a jurisdiction other than the Commonwealth of Massachusetts , the term " Code " shall mean the Uniform Commercial Code as enacted and in effect in such other jurisdiction solely for purposes on the provisions thereof relating to such attachment , perfection , priority , or remedies and for purposes of definitions relating to such provisions .

<response> " Code " is the Uniform Commercial Code , as the same may , from time to time , be enacted and in effect in the <location>Commonwealth of Massachusetts</location> ; provided , that , to the extent that the Code is used to define any term herein or in any Loan Document and such term is defined differently in different Articles or Divisions of the Code , the definition of such term contained in Article or Division 9 shall govern ; provided further , that in the event that , by reason of mandatory provisions of law , any or all of the attachment , perfection , or priority of , or remedies with respect to , Agent ' s and Lenders ' Lien on any Collateral is governed by the Uniform Commercial Code in effect in a jurisdiction other than the <location>Commonwealth of Massachusetts</location> , the term " Code " shall mean the Uniform Commercial Code as enacted and in effect in such other jurisdiction solely for purposes on the provisions thereof relating to such attachment , perfection , priority , or remedies and for purposes of definitions relating to such provisions . </response>


" Collateral " is any and all properties , rights and assets of Borrower described on Exhibit A .

<response> " Collateral " is any and all properties , rights and assets of <person>Borrower</person> described on Exhibit A . </response>


<response> " Collateral Account " is any Deposit Account , Securities Account , or Commodity Account . </response>


" Commitment " is the outstanding amount of Obligations based on each Lender ' s Commitment Percentage .

<response> " Commitment " is the outstanding amount of Obligations based on each <person>Lender</person> ' s Commitment Percentage . </response>


<response> " Commitment Percentage " is set forth in Schedule 1 . 1 , as amended from time to time . </response>


<response> " Commitment Termination Date " is March 31 , 2009 . </response>


<response> " Commodity Account " is any " commodity account " as defined in the Code with such additions to such term as may hereafter be made . </response>


<response> " Communication " is defined in Section 10 . </response>


<response> " Contingent Obligation " is , for any Person , any direct or indirect liability , contingent or not , of that Person for ( a ) any indebtedness , lease , dividend , letter of credit or other obligation of another such as an obligation directly or indirectly guaranteed , endorsed , co - made , discounted or sold with recourse by that Person , or for which </response>


<response> - 16 - that Person is directly or indirectly liable ; ( b ) any obligations for undrawn letters of credit for the account of that Person ; and ( c ) all obligations from any interest rate , currency or commodity swap agreement , interest rate cap or collar agreement , or other agreement or arrangement designated to protect a Person against fluctuation in interest rates , currency exchange rates or commodity prices ; but " Contingent Obligation " does not include endorsements in the ordinary course of business . </response>


<response> The amount of a Contingent Obligation is the stated or determined amount of the primary obligation for which the Contingent Obligation is made or , if not determinable , the maximum reasonably anticipated liability for it determined by the Person in good faith ; but the amount may not exceed the maximum of the obligations under any guarantee or other support arrangement . </response>


" Control Agreement " is any control agreement entered into among the depository institution at which Borrower maintains a Deposit Account or the securities intermediary or commodity intermediary at which Borrower maintains a Securities Account or a Commodity Account , Borrower , and Agent pursuant to which Agent obtains control for the benefit of Lenders ( within the meaning of the Code ) over such Deposit Account , Securities Account , or Commodity Account .

<response> " Control Agreement " is any control agreement entered into among the depository institution at which <person>Borrower</person> maintains a Deposit Account or the securities intermediary or commodity intermediary at which <person>Borrower</person> maintains a Securities Account or a Commodity Account , <person>Borrower</person> , and Agent pursuant to which Agent obtains control for the benefit of Lenders ( within the meaning of the Code ) over such Deposit Account , Securities Account , or Commodity Account . </response>


" Credit Extension " is any Term Loan , or any other extension of credit by Lenders for Borrower ' s benefit .

<response> " Credit Extension " is any Term Loan , or any other extension of credit by Lenders for <person>Borrower</person> ' s benefit . </response>


<response> " Default " is any event which with notice or passage of time or both , would constitute an Event of Default . </response>


<response> " Default Rate " is defined in Section 2 . 2 ( b ). </response>


<response> " Deposit Account " is any " deposit account " as defined in the Code with such additions to such term as may hereafter be made . </response>


" Designated Deposit Account " is Borrower ' s deposit account , account number maintained with Agent .

<response> " Designated Deposit Account " is <person>Borrower</person> ' s deposit account , account number maintained with Agent . </response>


" Dollars ," " dollars " and "$" each mean lawful money of the United States .

<response> " Dollars ," " dollars " and "$" each mean lawful money of the <location>United States</location> . </response>


<response> " Effective Date " is defined in the preamble of this Agreement . </response>


<response> " Equipment " is all " equipment " as defined in the Code with such additions to such term as may hereafter be made , and includes without limitation all machinery , fixtures , goods , vehicles ( including motor vehicles and trailers ), and any interest in any of the foregoing . </response>


" ERISA " is the Employee Retirement Income Security Act of 1974 , and its regulations .

<response> " <organization>ERISA</organization> " is the Employee Retirement Income Security Act of 1974 , and its regulations . </response>


<response> " Event of Default " is defined in Section 8 . </response>


<response> " Final Payment " is a payment ( in addition to and not a substitution for the regular monthly payments of principal plus accrued interest ) due on the earlier to occur of ( a ) the Maturity Date for such Term Loan , or ( b ) the acceleration of such Term Loan , equal to the Loan Amount for such Term Loan multiplied by the Final Payment Percentage . </response>


<response> " Final Payment Percentage " is , for each Term Loan , two percent ( 2 . 00 %). </response>


<response> " First Draw Period " is the period of time from the Effective Date through the earliest to occur of ( a ) December 31 , 2008 , and ( b ) termination by Agent after the occurrence and during the continuance of an Event of Default . </response>


" Funding Date " is any date on which a Credit Extension is made to or on account of Borrower which shall be a Business Day .

<response> " Funding Date " is any date on which a Credit Extension is made to or on account of <person>Borrower</person> which shall be a Business Day . </response>


" GAAP " is generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other Person as may be approved by a significant segment of the accounting profession , which are applicable to the circumstances as of the date of determination .

<response> " GAAP " is generally accepted accounting principles set forth in the opinions and pronouncements of the <organization>Accounting Principles Board</organization> of the <organization>American Institute of Certified Public Accountants</organization> and statements and pronouncements of the <organization>Financial Accounting Standards Board</organization> or in such other statements by such other Person as may be approved by a significant segment of the accounting profession , which are applicable to the circumstances as of the date of determination . </response>


<response> - 17 - " General Intangibles " is all " general intangibles " as defined in the Code in effect on the date hereof with such additions to such term as may hereafter be made , and includes without limitation , all copyright rights , copyright applications , copyright registrations and like protections in each work of authorship and derivative work , whether published or unpublished , any patents , trademarks , service marks and , to the extent permitted under applicable law , any applications therefor , whether registered or not , any trade secret rights , including any rights to unpatented inventions , payment intangibles , royalties , contract rights , goodwill , franchise agreements , purchase orders , customer lists , route lists , telephone numbers , domain names , claims , income and other tax refunds , security and other deposits , options to purchase or sell real or personal property , rights in all litigation presently or hereafter pending ( whether in contract , tort or otherwise ), insurance policies ( including without limitation key man , property damage , and business interruption insurance ), payments of insurance and rights to payment of any kind . </response>


" Gold Hill " is defined in the preamble hereof .

<response> " <location>Gold Hill</location> " is defined in the preamble hereof . </response>


<response> " Guarantor " is any present or future guarantor of the Obligations . </response>


" IL Subsidiary " means , Vringo ( Israel ) Ltd . " Indebtedness " is ( a ) indebtedness for borrowed money or the deferred price of property or services , such as reimbursement and other obligations for surety bonds and letters of credit , ( b ) obligations evidenced by notes , bonds , debentures or similar instruments , ( c ) capital lease obligations , and ( d ) Contingent Obligations .

<response> " IL Subsidiary " means , <organization>Vringo</organization> ( <location>Israel</location> ) Ltd . " Indebtedness " is ( a ) indebtedness for borrowed money or the deferred price of property or services , such as reimbursement and other obligations for surety bonds and letters of credit , ( b ) obligations evidenced by notes , bonds , debentures or similar instruments , ( c ) capital lease obligations , and ( d ) Contingent Obligations . </response>


" Insolvency Proceeding " is any proceeding by or against any Person under the United States Bankruptcy Code , or any other bankruptcy or insolvency law , including assignments for the benefit of creditors , compositions , extensions generally with its creditors , or proceedings seeking reorganization , arrangement , or other relief .

<response> " Insolvency Proceeding " is any proceeding by or against any Person under the <location>United States</location> Bankruptcy Code , or any other bankruptcy or insolvency law , including assignments for the benefit of creditors , compositions , extensions generally with its creditors , or proceedings seeking reorganization , arrangement , or other relief . </response>


" Inventory " is all " inventory " as defined in the Code in effect on the date hereof with such additions to such term as may hereafter be made , and includes without limitation all merchandise , raw materials , parts , supplies , packing and shipping materials , work in process and finished products , including without limitation such inventory as is temporarily out of Borrower ' s custody or possession or in transit and including any returned goods and any documents of title representing any of the above .

<response> " Inventory " is all " inventory " as defined in the Code in effect on the date hereof with such additions to such term as may hereafter be made , and includes without limitation all merchandise , raw materials , parts , supplies , packing and shipping materials , work in process and finished products , including without limitation such inventory as is temporarily out of <person>Borrower</person> ' s custody or possession or in transit and including any returned goods and any documents of title representing any of the above . </response>


<response> " Investment " is any beneficial ownership interest in any Person ( including stock , partnership interest or other securities ), and any loan , advance or capital contribution to any Person . </response>


" Key Person " is the Borrower ' s Chief Executive Officer , who is Jonathan Medved as of the Effective Date .

<response> " Key Person " is the <person>Borrower</person> ' s Chief Executive Officer , who is <person>Jonathan Medved</person> as of the Effective Date . </response>


" Lender " is any one of the Lenders .

<response> " <person>Lender</person> " is any one of the Lenders . </response>


<response> " Lenders " shall mean the Persons identified on Schedule 1 . 1 hereto and each assignee that becomes a party to this Agreement pursuant to Section 12 . 1 . </response>


" Lenders ' Expenses " are all documented audit fees and expenses , costs , and expenses ( including reasonable documented attorneys ' fees and expenses ) of Agent and Lenders for preparing , negotiating , administering , defending and enforcing the Loan Documents ( including , without limitation , those incurred in connection with appeals or Insolvency Proceedings ) or otherwise incurred with respect to Borrower .

<response> " Lenders ' Expenses " are all documented audit fees and expenses , costs , and expenses ( including reasonable documented attorneys ' fees and expenses ) of Agent and Lenders for preparing , negotiating , administering , defending and enforcing the Loan Documents ( including , without limitation , those incurred in connection with appeals or Insolvency Proceedings ) or otherwise incurred with respect to <person>Borrower</person> . </response>


<response> " Lien " is a mortgage , lien , deed of trust , charge , pledge , security interest or other encumbrance . </response>


<response> " Loan Amount " in respect of each Term Loan is the original principal amount of such Term Loan . </response>


" Loan Documents " are , collectively , this Agreement , the Warrant , the Perfection Certificate , any note , or notes or guaranties executed by Borrower , and any other present or future agreement for the benefit of Agent and / or Lenders in connection with this Agreement , all as amended , restated , or otherwise modified .

<response> " Loan Documents " are , collectively , this Agreement , the Warrant , the Perfection Certificate , any note , or notes or guaranties executed by <person>Borrower</person> , and any other present or future agreement for the benefit of Agent and / or Lenders in connection with this Agreement , all as amended , restated , or otherwise modified . </response>


<response> " Maturity Date " is the Term Loan Maturity Date . </response>


" Milestone Event No .

<response> " Milestone Event No . </response>


1 " means Borrower provides Agent with evidence that either of the following has occurred : ( a ) the completion of two ( 2 ) trials with two ( 2 ) large mobile telephone carriers with at least one ( 1 ) carrier service launched ; or ( b ) registration of at least fifty thousand ( 50 , 000 ) users .

<response> 1 " means <person>Borrower</person> provides Agent with evidence that either of the following has occurred : ( a ) the completion of two ( 2 ) trials with two ( 2 ) large mobile telephone carriers with at least one ( 1 ) carrier service launched ; or ( b ) registration of at least fifty thousand ( 50 , 000 ) users . </response>


- 18 - " Milestone Event No .

<response> - 18 - " Milestone Event No . </response>


2 " means Borrower provides Agent with evidence that either of the following has occurred : ( a ) the completion of four ( 4 ) trials with four ( 4 ) large mobile telephone carriers with at least two ( 2 ) carrier services launched ; or ( b ) registration of at least three hundred thousand ( 300 , 000 ) users .

<response> 2 " means <person>Borrower</person> provides Agent with evidence that either of the following has occurred : ( a ) the completion of four ( 4 ) trials with four ( 4 ) large mobile telephone carriers with at least two ( 2 ) carrier services launched ; or ( b ) registration of at least three hundred thousand ( 300 , 000 ) users . </response>


" Obligations " are Borrower ' s obligation to pay when due any debts , principal , interest , Lenders ' Expenses , the Final Payment and other amounts Borrower owes Agent and / or Lenders now or later , whether under this Agreement , the Loan Documents , or otherwise , including , without limitation , all obligations relating to letters of credit ( including reimbursement obligations for drawn and undrawn letters of credit ), cash management services , and foreign exchange contracts , if any , and including interest accruing after Insolvency Proceedings begin and debts , liabilities , or obligations of Borrower assigned to Agent and / or Lenders , and the performance of Borrower ' s duties under the Loan Documents .

<response> " Obligations " are <person>Borrower</person> ' s obligation to pay when due any debts , principal , interest , Lenders ' Expenses , the Final Payment and other amounts <person>Borrower</person> owes Agent and / or Lenders now or later , whether under this Agreement , the Loan Documents , or otherwise , including , without limitation , all obligations relating to letters of credit ( including reimbursement obligations for drawn and undrawn letters of credit ), cash management services , and foreign exchange contracts , if any , and including interest accruing after Insolvency Proceedings begin and debts , liabilities , or obligations of <person>Borrower</person> assigned to Agent and / or Lenders , and the performance of <person>Borrower</person> ' s duties under the Loan Documents . </response>


Notwithstanding the foregoing , the term " Obligations " shall not include any of Borrower ' s obligations under any Warrant issued to Lenders .

<response> Notwithstanding the foregoing , the term " Obligations " shall not include any of <person>Borrower</person> ' s obligations under any Warrant issued to Lenders . </response>


<response> " Operating Documents " are , for any Person , such Person ' s formation documents , as certified with the Secretary of State of such Person ' s state of formation on a date that is no earlier than thirty ( 30 ) days prior to the Effective Date , and its bylaws in current form , each of the foregoing with all current amendments or modifications thereto . </response>


<response> " Payment Date " is the first calendar day of each month . </response>


<response> " Payment / Advance Form " is that certain form attached hereto as Exhibit B . </response>


<response> " Perfection Certificate " is defined in Section 5 . 1 . </response>


" Permitted Indebtedness " is : ( a ) Borrower ' s Indebtedness to Lenders under this Agreement and the other Loan Documents ; ( b ) Indebtedness existing on the Effective Date and shown on the Perfection Certificate ; ( c ) Subordinated Debt ; ( d ) unsecured Indebtedness to trade creditors and with respect to surety bonds and similar obligations incurred in the ordinary course of business ; ( e ) Indebtedness incurred as a result of endorsing negotiable instruments received in the ordinary course of business ; ( f ) Indebtedness secured by Permitted Liens ; ( g ) Inter - company Indebtedness that otherwise constitutes an Investment allowed under clause ( a ) and ( f ) of Permitted Investments ; ( h ) other Indebtedness in an aggregate amount not to exceed Fifty Thousand Dollars ($ 50 , 000 ) in the aggregate in any fiscal year ; and ( i ) extensions , refinancings , modifications , amendments and restatements of any items of Permitted Indebtedness ( a ) through ( h ) above , provided that the principal amount thereof is not increased or the terms thereof are not modified to impose more burdensome terms upon Borrower or its Subsidiary , as the case may be .

<response> " Permitted Indebtedness " is : ( a ) <person>Borrower</person> ' s Indebtedness to Lenders under this Agreement and the other Loan Documents ; ( b ) Indebtedness existing on the Effective Date and shown on the Perfection Certificate ; ( c ) Subordinated Debt ; ( d ) unsecured Indebtedness to trade creditors and with respect to surety bonds and similar obligations incurred in the ordinary course of business ; ( e ) Indebtedness incurred as a result of endorsing negotiable instruments received in the ordinary course of business ; ( f ) Indebtedness secured by Permitted Liens ; ( g ) Inter - company Indebtedness that otherwise constitutes an Investment allowed under clause ( a ) and ( f ) of Permitted Investments ; ( h ) other Indebtedness in an aggregate amount not to exceed Fifty Thousand Dollars ($ 50 , 000 ) in the aggregate in any fiscal year ; and ( i ) extensions , refinancings , modifications , amendments and restatements of any items of Permitted Indebtedness ( a ) through ( h ) above , provided that the principal amount thereof is not increased or the terms thereof are not modified to impose more burdensome terms upon <person>Borrower</person> or its Subsidiary , as the case may be . </response>


" Permitted Investments " are : ( a ) Investments shown on the Perfection Certificate and existing on the Effective Date ( b ) Cash Equivalents and ( ii ) any Investments permitted by Borrower ' s investment policy , as amended from time to time , provided that such investment policy ( and any such amendment thereto ) has been approved by Agent ; ( c ) Investments consisting of the endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of Borrower ;

<response> " Permitted Investments " are : ( a ) Investments shown on the Perfection Certificate and existing on the Effective Date ( b ) Cash Equivalents and ( ii ) any Investments permitted by <person>Borrower</person> ' s investment policy , as amended from time to time , provided that such investment policy ( and any such amendment thereto ) has been approved by Agent ; ( c ) Investments consisting of the endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of <person>Borrower</person> ; </response>


- 19 - ( d ) Investments consisting of Borrower ' s deposit accounts in which Agent has a first perfected security interest and Investments consisting of Subsidiaries ' deposit accounts ; ( e ) Investments accepted in connection with Transfers permitted by Section 7 . 1 ; ( f ) Investments of Subsidiaries in or to other Subsidiaries or Borrower and Investments by Borrower in Subsidiaries not to exceed Two Hundred Fifty Thousand Dollars ($ 250 , 000 ) in the aggregate in any fiscal year ; ( g ) Investments consisting of ( i ) travel advances and employee relocation loans and other employee loans and advances in the ordinary course of business , and ( ii ) loans to employees , officers or directors relating to the purchase of equity securities of Borrower or its Subsidiaries pursuant to employee stock purchase plans or agreements approved by Borrower ' s Board ; ( h ) Investments ( including debt obligations ) received in connection with the bankruptcy or reorganization of customers or suppliers and in settlement of delinquent obligations of , and other disputes with , customers or suppliers arising in the ordinary course of business ; ( i ) Investments consisting of notes receivable of , or prepaid royalties and other credit extensions , to customers and suppliers who are not Affiliates , in the ordinary course of business ; provided that this paragraph ( i ) shall not apply to Investments of Borrower in any Subsidiary ; ( j ) joint ventures or strategic alliances in the ordinary course of Borrower ' s business consisting of the non - exclusive licensing of technology , the development of technology or the providing of technical support , provided that any cash investments by Borrower do not exceed Two Hundred Fifty Thousand Dollars ($ 250 , 000 ) in the aggregate in any fiscal year ; and ( k ) other Investments in an aggregate amount no to exceed Fifty Thousand Dollars ($ 50 , 000 ) in the aggregate in any fiscal year .

<response> - 19 - ( d ) Investments consisting of <person>Borrower</person> ' s deposit accounts in which Agent has a first perfected security interest and Investments consisting of Subsidiaries ' deposit accounts ; ( e ) Investments accepted in connection with Transfers permitted by Section 7 . 1 ; ( f ) Investments of Subsidiaries in or to other Subsidiaries or <person>Borrower</person> and Investments by <person>Borrower</person> in Subsidiaries not to exceed Two Hundred Fifty Thousand Dollars ($ 250 , 000 ) in the aggregate in any fiscal year ; ( g ) Investments consisting of ( i ) travel advances and employee relocation loans and other employee loans and advances in the ordinary course of business , and ( ii ) loans to employees , officers or directors relating to the purchase of equity securities of <person>Borrower</person> or its Subsidiaries pursuant to employee stock purchase plans or agreements approved by <person>Borrower</person> ' s Board ; ( h ) Investments ( including debt obligations ) received in connection with the bankruptcy or reorganization of customers or suppliers and in settlement of delinquent obligations of , and other disputes with , customers or suppliers arising in the ordinary course of business ; ( i ) Investments consisting of notes receivable of , or prepaid royalties and other credit extensions , to customers and suppliers who are not Affiliates , in the ordinary course of business ; provided that this paragraph ( i ) shall not apply to Investments of <person>Borrower</person> in any Subsidiary ; ( j ) joint ventures or strategic alliances in the ordinary course of <person>Borrower</person> ' s business consisting of the non - exclusive licensing of technology , the development of technology or the providing of technical support , provided that any cash investments by <person>Borrower</person> do not exceed Two Hundred Fifty Thousand Dollars ($ 250 , 000 ) in the aggregate in any fiscal year ; and ( k ) other Investments in an aggregate amount no to exceed Fifty Thousand Dollars ($ 50 , 000 ) in the aggregate in any fiscal year . </response>


" Permitted Liens " are : ( a ) Liens existing on the Effective Date and shown on the Perfection Certificate or arising under this Agreement and the other Loan Documents ; ( b ) Liens for taxes , fees , assessments or other government charges or levies , either not delinquent or being contested in good faith and for which Borrower maintains adequate reserves on its Books , if they have no priority over any of Lenders ; Liens ; ( c ) purchase money Liens ( i ) on Equipment acquired or held by Borrower incurred for financing the acquisition or lease of Equipment securing no more than Two Hundred Fifty Thousand Dollars ($ 250 , 000 . 00 ) in the aggregate amount outstanding , or ( ii ) existing on Equipment when acquired , if the Lien is confined to the property and improvements and the proceeds of the Equipment ; ( d ) statutory Liens securing claims or demands of materialmen , mechanics , carriers , warehousemen , landlords and other Persons imposed without action of such parties , provided , they have no priority over any of Lenders ' Lien and the aggregate amount of such Liens does not at any time exceed Fifty Thousand Dollars ($ 50 , 000 ); ( e ) Liens to secure payment of workers ' compensation , employment insurance , old - age pensions , social security and other like obligations incurred in the ordinary course of business , provided , they have no priority over any of Lenders ' Liens and the aggregate amount of the Indebtedness secured by such Liens does not at any time exceed Fifty Thousand Dollars ($ 50 , 000 ); ( f ) Liens incurred in the extension , renewal or refinancing of the indebtedness secured by Liens described in ( a ) through ( e ), but any extension , renewal or replacement Lien must be limited to the property encumbered by the existing Lien and the principal amount of the indebtedness may not increase ; ( g ) leases or subleases of real property granted in the ordinary course of business , and leases , subleases , non - exclusive licenses or sublicenses of property ( other than real property or intellectual property ) granted in the ordinary course of Borrower ' s business , if the leases , subleases , licenses and sublicenses do not prohibit granting Lenders a security interest ;

<response> " Permitted Liens " are : ( a ) Liens existing on the Effective Date and shown on the Perfection Certificate or arising under this Agreement and the other Loan Documents ; ( b ) Liens for taxes , fees , assessments or other government charges or levies , either not delinquent or being contested in good faith and for which <person>Borrower</person> maintains adequate reserves on its Books , if they have no priority over any of Lenders ; Liens ; ( c ) purchase money Liens ( i ) on Equipment acquired or held by <person>Borrower</person> incurred for financing the acquisition or lease of Equipment securing no more than Two Hundred Fifty Thousand Dollars ($ 250 , 000 . 00 ) in the aggregate amount outstanding , or ( ii ) existing on Equipment when acquired , if the Lien is confined to the property and improvements and the proceeds of the Equipment ; ( d ) statutory Liens securing claims or demands of materialmen , mechanics , carriers , warehousemen , landlords and other Persons imposed without action of such parties , provided , they have no priority over any of Lenders ' Lien and the aggregate amount of such Liens does not at any time exceed Fifty Thousand Dollars ($ 50 , 000 ); ( e ) Liens to secure payment of workers ' compensation , employment insurance , old - age pensions , social security and other like obligations incurred in the ordinary course of business , provided , they have no priority over any of Lenders ' Liens and the aggregate amount of the Indebtedness secured by such Liens does not at any time exceed Fifty Thousand Dollars ($ 50 , 000 ); ( f ) Liens incurred in the extension , renewal or refinancing of the indebtedness secured by Liens described in ( a ) through ( e ), but any extension , renewal or replacement Lien must be limited to the property encumbered by the existing Lien and the principal amount of the indebtedness may not increase ; ( g ) leases or subleases of real property granted in the ordinary course of business , and leases , subleases , non - exclusive licenses or sublicenses of property ( other than real property or intellectual property ) granted in the ordinary course of <person>Borrower</person> ' s business , if the leases , subleases , licenses and sublicenses do not prohibit granting Lenders a security interest ; </response>


- 20 - ( h ) non - exclusive license of intellectual property granted to third parties in the ordinary course of business ; ( i ) Liens arising from judgments , decrees or attachments in circumstances not constituting an Event of Default under Section 8 . 4 or 8 . 7 ; ( j ) Liens in favor of other financial institutions arising in connection with Borrower ' s deposit and / or securities accounts held at such institutions , provided that Lenders have a perfected security interest in the amounts held in such deposit and / or securities accounts ; and ( k ) Liens in favor of other financial institutions arising in connection with Borrower ' s Subsidiaries ' deposit and / or securities accounts held at such institutions .

<response> - 20 - ( h ) non - exclusive license of intellectual property granted to third parties in the ordinary course of business ; ( i ) Liens arising from judgments , decrees or attachments in circumstances not constituting an Event of Default under Section 8 . 4 or 8 . 7 ; ( j ) Liens in favor of other financial institutions arising in connection with <person>Borrower</person> ' s deposit and / or securities accounts held at such institutions , provided that Lenders have a perfected security interest in the amounts held in such deposit and / or securities accounts ; and ( k ) Liens in favor of other financial institutions arising in connection with <person>Borrower</person> ' s Subsidiaries ' deposit and / or securities accounts held at such institutions . </response>


<response> " Person " is any individual , sole proprietorship , partnership , limited liability company , joint venture , company , trust , unincorporated organization , association , corporation , institution , public benefit corporation , firm , joint stock company , estate , entity or government agency . </response>


<response> " Prepayment Fee " shall be an additional fee payable to the Agent in amount equal to : ( i ) for a prepayment made on or before one year from the applicable Funding Date of such Term Loan , three percent ( 3 . 0 %) of the principal amount of such Term Loan prepaid ; or ( ii ) for a prepayment made after one year , but on or before two years from the applicable Funding Date of such Term Loan , two percent ( 2 . 0 %) of the principal amount of such Term Loan prepaid ; or ( iii ) for a prepayment made after two years , but on or before three years from the applicable Funding Date of such Term Loan , one percent ( 1 . 0 %) of the principal amount of such Term Loan prepaid . </response>


" Registered Organization " is any " registered organization " as defined in the Code with such additions to such term as may hereafter be made " Responsible Officer " is any of the Chief Executive Officer , President , Chief Financial Officer , and Controller of Borrower .

<response> " Registered Organization " is any " registered organization " as defined in the Code with such additions to such term as may hereafter be made " Responsible Officer " is any of the Chief Executive Officer , President , Chief Financial Officer , and Controller of <person>Borrower</person> . </response>


<response> " Second Draw Period " is the period of time commencing upon the occurrence of the Milestone Event No . </response>


<response> 1 through the earliest to occur of ( x ) March 31 , 2009 , and ( y ) termination by Agent after the occurrence and during the continuance of an Event of Default . </response>


<response> " Securities Account " is any " securities account " as defined in the Code with such additions to such term as may hereafter be made . </response>


" Subordinated Debt " is indebtedness incurred by Borrower subordinated to all of Borrower ' s now or hereafter indebtedness to Agent and Lenders ( pursuant to a subordination , intercreditor , or other similar agreement in form and substance satisfactory to Agent and Lenders entered into among Agent , Lenders and the other creditor ), on terms acceptable to Agent and Lenders .

<response> " Subordinated Debt " is indebtedness incurred by <person>Borrower</person> subordinated to all of <person>Borrower</person> ' s now or hereafter indebtedness to Agent and Lenders ( pursuant to a subordination , intercreditor , or other similar agreement in form and substance satisfactory to Agent and Lenders entered into among Agent , Lenders and the other creditor ), on terms acceptable to Agent and Lenders . </response>


<response> " Subsidiary " is , with respect to any Person , any Person of which more than 50 % of the voting stock or other equity interests ( in the case of Persons other than corporations ) is owned or controlled , directly or indirectly , by such Person or one or more Affiliates of such Person . </response>


<response> " SVB " is defined in the preamble hereof . </response>


<response> " Term Loan " is defined in Section 2 . 1 . 1 hereof . </response>


<response> - 21 - " Term Loan Maturity Date " is the final Payment Date for each Term Loan which shall be the date thirty - five ( 35 ) months from the first Payment Date for such Term Loan . </response>


<response> " Third Draw Period " is the period of time commencing upon the occurrence of the Milestone Event No . </response>


<response> 2 through the earliest to occur of ( x ) March 31 , 2009 , and ( y ) termination by Agent after the occurrence and during the continuance of an Event of Default . </response>


<response> " Transfer " is defined in Section 7 . 1 . </response>


" Warrant " is , collectively , ( a ) that certain Warrant to Purchase Stock dated as of the Effective Date executed by Borrower in favor of SVB , and ( b ) that certain Warrant to Purchase Stock dated as of the Effective Date executed by Borrower in favor of Gold Hill .

<response> " Warrant " is , collectively , ( a ) that certain Warrant to Purchase Stock dated as of the Effective Date executed by <person>Borrower</person> in favor of SVB , and ( b ) that certain Warrant to Purchase Stock dated as of the Effective Date executed by <person>Borrower</person> in favor of <location>Gold Hill</location> . </response>


[ Signature page follows .]

<response> [ Signature page follows .] </response>


- 22 - IN WITNESS WHEREOF , the parties hereto have caused this Agreement to be executed as a sealed instrument under the laws of the Commonwealth of Massachusetts as of the Effective Date .

<response> - 22 - IN WITNESS WHEREOF , the parties hereto have caused this Agreement to be executed as a sealed instrument under the laws of the <location>Commonwealth of Massachusetts</location> as of the Effective Date . </response>


BORROWER :

<response> <person>BORROWER</person> : </response>


VRINGO , INC . By : / s / Jonathan Medved Name : Jonathan Medved Title : CEO LENDERS : SILICON VALLEY BANK , as Agent and as a LENDER By : / s / Michael Morreti Name : Michael Morreti Title : SVP GOLD HILL VENTURE LENDING 03 , L . P ., as LENDER

<response> <organization>VRINGO</organization> , INC . By : / s / <person>Jonathan Medved</person> Name : <person>Jonathan Medved</person> Title : CEO LENDERS : <organization>SILICON VALLEY BANK</organization> , as Agent and as a <person>LENDER</person> By : / s / <person>Michael Morreti</person> Name : <person>Michael Morreti</person> Title : <location>SVP GOLD HILL VENTURE LENDING 03</location> , L . P ., as <person>LENDER</person> </response>


<response> By : GOLD HILL VENTURE LENDING PARTNERS 03 , LLC , its General Partner By : / s / David Fischer Name : David Fischer Title : Manager [ Signature page to Loan and Security Agreement ] Schedule 1 . 1 Lenders and Commitments </response>


Lender


Commitment Commitment Percentage Silicon Valley Bank $ 1 , 500 , 000 . 00 30 . 00 % Gold Hill Venture Lending 03 , L . P . $ 3 , 500 , 000 . 00 70 . 00 % TOTAL $ 5 , 000 , 000 . 00 100 . 00 %

<response> Commitment Commitment Percentage <organization>Silicon Valley Bank</organization> $ 1 , 500 , 000 . 00 30 . 00 % <location>Gold Hill Venture Lending 03</location> , L . P . $ 3 , 500 , 000 . 00 70 . 00 % TOTAL $ 5 , 000 , 000 . 00 100 . 00 % </response>


1 EXHIBIT A The Collateral consists of all of Borrower ' s right , title and interest in and to the following personal property : All goods , Accounts ( including health - care receivables ), Equipment , Inventory , contract rights or rights to payment of money , leases , license agreements , franchise agreements , General Intangibles ( except as provided below ), commercial tort claims , documents , instruments ( including any promissory notes ), chattel paper ( whether tangible or electronic ), cash , deposit accounts , certificates of deposit , fixtures , letters of credit rights ( whether or not the letter of credit is evidenced by a writing ), securities , and all other investment property , supporting obligations , and financial assets , whether now owned or hereafter acquired , wherever located ; and All Borrower ' s Books relating to the foregoing , and any and all claims , rights and interests in any of the above and all substitutions for , additions , attachments , accessories , accessions and improvements to and replacements , products , proceeds and insurance proceeds of any or all of the foregoing .

<response> 1 EXHIBIT A The Collateral consists of all of <person>Borrower</person> ' s right , title and interest in and to the following personal property : All goods , Accounts ( including health - care receivables ), Equipment , Inventory , contract rights or rights to payment of money , leases , license agreements , franchise agreements , General Intangibles ( except as provided below ), commercial tort claims , documents , instruments ( including any promissory notes ), chattel paper ( whether tangible or electronic ), cash , deposit accounts , certificates of deposit , fixtures , letters of credit rights ( whether or not the letter of credit is evidenced by a writing ), securities , and all other investment property , supporting obligations , and financial assets , whether now owned or hereafter acquired , wherever located ; and All <person>Borrower</person> ' s Books relating to the foregoing , and any and all claims , rights and interests in any of the above and all substitutions for , additions , attachments , accessories , accessions and improvements to and replacements , products , proceeds and insurance proceeds of any or all of the foregoing . </response>


Notwithstanding the foregoing , the Collateral does not include any of the following , whether now owned or hereafter acquired : ( a ) more than 65 % of the presently existing and hereafter arising issued and outstanding shares of capital stock owned by Borrower of any Foreign Subsidiary which shares entitle the holder thereof to vote for directors or any other matter , ( b ) property subject to a lien described in clause ( c ) of the definition of Permitted Lien , and ( c ) any copyright rights , copyright applications , copyright registrations and like protections in each work of authorship and derivative work , whether published or unpublished , any patents , patent applications and like protections , including improvements , divisions , continuations , renewals , reissues , extensions , and continuations - in - part of the same , trademarks , service marks and , to the extent permitted under applicable law , any applications therefor , whether registered or not , and the goodwill of the business of Borrower connected with and symbolized thereby , know - how , operating manuals , trade secret rights , rights to unpatented inventions , and any claims for damage by way of any past , present , or future infringement of any of the foregoing ; provided , however , the Collateral shall include all Accounts , license and royalty fees and other revenues , proceeds , or income arising out of or relating to any of the foregoing .

<response> Notwithstanding the foregoing , the Collateral does not include any of the following , whether now owned or hereafter acquired : ( a ) more than 65 % of the presently existing and hereafter arising issued and outstanding shares of capital stock owned by <person>Borrower</person> of any Foreign Subsidiary which shares entitle the holder thereof to vote for directors or any other matter , ( b ) property subject to a lien described in clause ( c ) of the definition of Permitted Lien , and ( c ) any copyright rights , copyright applications , copyright registrations and like protections in each work of authorship and derivative work , whether published or unpublished , any patents , patent applications and like protections , including improvements , divisions , continuations , renewals , reissues , extensions , and continuations - in - part of the same , trademarks , service marks and , to the extent permitted under applicable law , any applications therefor , whether registered or not , and the goodwill of the business of <person>Borrower</person> connected with and symbolized thereby , know - how , operating manuals , trade secret rights , rights to unpatented inventions , and any claims for damage by way of any past , present , or future infringement of any of the foregoing ; provided , however , the Collateral shall include all Accounts , license and royalty fees and other revenues , proceeds , or income arising out of or relating to any of the foregoing . </response>


Pursuant to the terms of a certain negative pledge arrangement with Lenders , Borrower has agreed not to encumber any of its copyright rights , copyright applications , copyright registrations and like protections in each work of authorship and derivative work , whether published or unpublished , any patents , patent applications and like protections , including improvements , divisions , continuations , renewals , reissues , extensions , and continuations - in - part of the same , trademarks , service marks and , to the extent permitted under applicable law , any applications therefor , whether registered or not , and the goodwill of the business of Borrower connected with and symbolized thereby , know - how , operating manuals , trade secret rights , rights to unpatented inventions , and any claims for damage by way of any past , present , or future infringement of any of the foregoing , without Agent ' s prior written consent .

<response> Pursuant to the terms of a certain negative pledge arrangement with Lenders , <person>Borrower</person> has agreed not to encumber any of its copyright rights , copyright applications , copyright registrations and like protections in each work of authorship and derivative work , whether published or unpublished , any patents , patent applications and like protections , including improvements , divisions , continuations , renewals , reissues , extensions , and continuations - in - part of the same , trademarks , service marks and , to the extent permitted under applicable law , any applications therefor , whether registered or not , and the goodwill of the business of <person>Borrower</person> connected with and symbolized thereby , know - how , operating manuals , trade secret rights , rights to unpatented inventions , and any claims for damage by way of any past , present , or future infringement of any of the foregoing , without Agent ' s prior written consent . </response>


<response> 2 EXHIBIT B Loan Payment / Term Loan Advance Request Form Deadline for same day processing is 12 : 00 E . S . T . </response>


Fax To :


Date : LOAN PAYMENT : Vringo , Inc .

<response> Date : LOAN PAYMENT : <organization>Vringo</organization> , Inc . </response>


<response> From Account # To Account # ( Deposit Account #) ( Loan Account #) Principal $ and / or Interest $ </response>


<response> Authorized Signature : Phone Number : LOAN ADVANCE : Complete Outgoing Wire Request section below if all or a portion of the funds from this loan advance are for an outgoing wire . </response>


From Account # To Account # ( Loan Account #) ( Deposit Account #) Amount of Term Loan Advance $ All Borrower ' s representation and warranties in the Term Loan and Security Agreement are true , in all material respects on the date of the telephone transfer request for an advance , but those representations and warranties expressly referring to another date shall be true , correct and complete in all material respects as of such date :

<response> From Account # To Account # ( Loan Account #) ( Deposit Account #) Amount of Term Loan Advance $ All <person>Borrower</person> ' s representation and warranties in the Term Loan and Security Agreement are true , in all material respects on the date of the telephone transfer request for an advance , but those representations and warranties expressly referring to another date shall be true , correct and complete in all material respects as of such date : </response>


<response> Authorized Signature : Phone Number : OUTGOING WIRE REQUEST Complete only if all or a portion of funds from the loan advance above are to be wired . </response>


<response> Deadline for same day processing is 12 : 00pm , E . S . T . </response>


Beneficiary Name : Amount of Wire : $ Beneficiary Bank : Account Number : City and Sate : Beneficiary Bank Transit ( ABA ) #: _________________ Beneficiary Bank Code ( Swift , Sort , Chip , etc .

<response> Beneficiary Name : Amount of Wire : $ Beneficiary <organization>Bank</organization> : Account Number : City and Sate : Beneficiary <organization>Bank</organization> Transit ( ABA ) #: _________________ Beneficiary <organization>Bank</organization> Code ( Swift , Sort , Chip , etc . </response>


): ( For International Wire Only ) Intermediary Bank : Transit ( ABA ) #: For Further Credit to : Special Instruction : By signing below , I ( we ) acknowledge and agree that my ( our ) funds transfer request shall be processed in accordance with and subject to the terms and conditions set forth in the agreements ( s ) covering funds transfer service ( s ), which agreements ( s ) were previously received and executed by me ( us ).

<response> ): ( For International Wire Only ) Intermediary <organization>Bank</organization> : Transit ( ABA ) #: For Further Credit to : Special Instruction : By signing below , I ( we ) acknowledge and agree that my ( our ) funds transfer request shall be processed in accordance with and subject to the terms and conditions set forth in the agreements ( s ) covering funds transfer service ( s ), which agreements ( s ) were previously received and executed by me ( us ). </response>


<response> Authorized Signature : 2nd Signature ( If Required ): Print Name / Title : Print Name / Title : Telephone # Telephone # </response>


-DOCSTART-


Loan Agreement


This Loan Agreement ( this “ Agreement ”) is made and entered into by and between the parties listed below as of the 19th day of October , 2004 in Beijing :

<response> This Loan Agreement ( this “ Agreement ”) is made and entered into by and between the parties listed below as of the 19th day of October , 2004 in <location>Beijing</location> : </response>


( 1 ) Lenovo - AsiaInfo Technologies , Inc . (“ Lender ”), a limited company duly organized and existing under the laws of the People ’ s Republic of China (“ PRC ” or “ China ”) with its address at 3 / F Zhongdian Information Tower , No . 6 Zhongguancun South Street , Haidian District , Beijing 100086 , P . R .

<response> ( 1 ) <organization>Lenovo - AsiaInfo Technologies</organization> , Inc . (“ <person>Lender</person> ”), a limited company duly organized and existing under the laws of the People ’ s Republic of <location>China</location> (“ PRC ” or “ <location>China</location> ”) with its address at <location>3 / F Zhongdian Information Tower</location> , No . <location>6 Zhongguancun South Street</location> , <location>Haidian District</location> , <location>Beijing</location> 100086 , P . R . </response>


China ;

<response> <location>China</location> ; </response>


( 2 ) Bing Yu (“ Borrower ”), a citizen of China with Chinese identification No .

<response> ( 2 ) <person>Bing Yu</person> (“ <person>Borrower</person> ”), a citizen of <location>China</location> with <miscellaneous>Chinese</miscellaneous> identification No . </response>


: 110108650831235 , and an address at 1 - 4 - 48 , No . 1 Jinjia Village , Fengtai District , Beijing , P . R . China .

<response> : 110108650831235 , and an address at 1 - 4 - 48 , No . 1 <location>Jinjia Village</location> , <location>Fengtai District</location> , <location>Beijing</location> , P . R . <location>China</location> . </response>


Each of Lender and Borrower shall be hereinafter referred to as a “ Party ” respectively , and collectively , the “ Parties ”.

<response> Each of <person>Lender</person> and <person>Borrower</person> shall be hereinafter referred to as a “ Party ” respectively , and collectively , the “ Parties ”. </response>


Whereas , Lender intends to provide Borrower with a loan to be used under this Agreement .

<response> Whereas , <person>Lender</person> intends to provide <person>Borrower</person> with a loan to be used under this Agreement . </response>


To further clarify the rights and obligations of both Lender and Borrower , after friendly consultation , the Parties agree as follows :

<response> To further clarify the rights and obligations of both <person>Lender</person> and <person>Borrower</person> , after friendly consultation , the Parties agree as follows : </response>


1 Loan


1 . 1 In accordance with the terms and conditions of this Agreement , Lender agrees to provide a loan in the amount of RMB6 , 000 , 000 . 00 ( the “ Loan ”) to Borrower .

<response> 1 . 1 In accordance with the terms and conditions of this Agreement , <person>Lender</person> agrees to provide a loan in the amount of RMB6 , 000 , 000 . 00 ( the “ Loan ”) to <person>Borrower</person> . </response>


<response> The term of the Loan shall be ten years from the date of this Agreement , which may be extended upon mutual written consent of the Parties . </response>


During the term of the Loan or the extended term of the Loan , Borrower shall immediately repay the full amount of the Loan in the event any one or more of the following circumstances occur :

<response> During the term of the Loan or the extended term of the Loan , <person>Borrower</person> shall immediately repay the full amount of the Loan in the event any one or more of the following circumstances occur : </response>


1 . 1 . 1 30 days elapse after the Borrower receives written notice from the Lender requesting repayment of the Loan ;

<response> 1 . 1 . 1 30 days elapse after the <person>Borrower</person> receives written notice from the <person>Lender</person> requesting repayment of the Loan ; </response>


1 . 1 . 2 Borrower ’ s death , lack or limitation of civil capacity ;

<response> 1 . 1 . 2 <person>Borrower</person> ’ s death , lack or limitation of civil capacity ; </response>


1 . 1 . 3 Borrower ceases ( for any reason ) to be an employee of Lender , Borrower Company ( as defined below ) or its affiliated entity ;

<response> 1 . 1 . 3 <person>Borrower</person> ceases ( for any reason ) to be an employee of <person>Lender</person> , <person>Borrower</person> Company ( as defined below ) or its affiliated entity ; </response>


1 . 1 . 4 Borrower engages in criminal conduct or is involved in criminal activities ;

<response> 1 . 1 . 4 <person>Borrower</person> engages in criminal conduct or is involved in criminal activities ; </response>


1 1 . 1 . 5 Any third party filed a claim against Borrower that exceeds RMB1 , 000 , 000 ; or

<response> 1 1 . 1 . 5 Any third party filed a claim against <person>Borrower</person> that exceeds RMB1 , 000 , 000 ; or </response>


1 . 1 . 6 According to the applicable laws of China , foreign investors are permitted to invest in security service business in China with a controlling stake or in the form of wholly - foreign - owned enterprises , the relevant competent authorities of China begin to approve such investments , and Lender decides to exercise the exclusive option under the Exclusive Option Agreement ( the “ Exclusive Option Agreement ”) described in Sections 4 . 1 . 1 and 4 . 2 . 5 of this Agreement .

<response> 1 . 1 . 6 According to the applicable laws of <location>China</location> , foreign investors are permitted to invest in security service business in <location>China</location> with a controlling stake or in the form of wholly - foreign - owned enterprises , the relevant competent authorities of <location>China</location> begin to approve such investments , and <person>Lender</person> decides to exercise the exclusive option under the Exclusive Option Agreement ( the “ Exclusive Option Agreement ”) described in Sections 4 . 1 . 1 and 4 . 2 . 5 of this Agreement . </response>


1 . 2 Lender agrees to remit the total amount under the Loan to the account designated by Borrower within 10 working days after receiving a written notification from the Borrower regarding the same , provided that all the conditions precedent in Section 2 are fulfilled .

<response> 1 . 2 <person>Lender</person> agrees to remit the total amount under the Loan to the account designated by <person>Borrower</person> within 10 working days after receiving a written notification from the <person>Borrower</person> regarding the same , provided that all the conditions precedent in Section 2 are fulfilled . </response>


Borrower shall provide Lender with a written receipt for the Loan upon receiving the Loan .

<response> <person>Borrower</person> shall provide <person>Lender</person> with a written receipt for the Loan upon receiving the Loan . </response>


The Loan provided by Lender under this Agreement shall inure to Borrower ’ s benefit only and not to Borrower ’ s successors or assigns .

<response> The Loan provided by <person>Lender</person> under this Agreement shall inure to <person>Borrower</person> ’ s benefit only and not to <person>Borrower</person> ’ s successors or assigns . </response>


1 . 3 Borrower agrees to accept the aforementioned Loan provided by Lender , and hereby agrees and warrants that the Loan shall be used solely to fund its contribution to the registered capital of [ Lenovo Security Technology Ltd . ( hereinafter the “ Borrower Company ”, a domestic - funded limited liability company in China with registered capital of Renminbi Twenty Four Million ( RMB24 , 000 , 000 . 00 )).

<response> 1 . 3 <person>Borrower</person> agrees to accept the aforementioned Loan provided by <person>Lender</person> , and hereby agrees and warrants that the Loan shall be used solely to fund its contribution to the registered capital of [ <organization>Lenovo Security Technology Ltd</organization> . ( hereinafter the “ <person>Borrower</person> Company ”, a domestic - funded limited liability company in <location>China</location> with registered capital of Renminbi Twenty Four Million ( RMB24 , 000 , 000 . 00 )). </response>


Upon such contribution , Borrower shall own 25 % of the equity interests in Borrower Company ( the “ Borrower Equity Interest ”).

<response> Upon such contribution , <person>Borrower</person> shall own 25 % of the equity interests in <person>Borrower</person> Company ( the “ <person>Borrower</person> Equity Interest ”). </response>


Borrower agrees to secure registration of the Borrower Company within 10 working days after receiving the Loan , and provide Lender with copies of the registration documents at the government department for industry and commerce , business licenses , and articles of association .

<response> <person>Borrower</person> agrees to secure registration of the <person>Borrower</person> Company within 10 working days after receiving the Loan , and provide <person>Lender</person> with copies of the registration documents at the government department for industry and commerce , business licenses , and articles of association . </response>


Without Lender ’ s prior written consent , Borrower shall not use the Loan for any purpose other than as set forth herein .

<response> Without <person>Lender</person> ’ s prior written consent , <person>Borrower</person> shall not use the Loan for any purpose other than as set forth herein . </response>


1 . 4 Lender and Borrower hereby agree and acknowledge that Borrower ’ s method of repayment may at Lender ’ s option take the form of Borrower ’ s transferring the Borrower Equity Interest to Lender or Lender ’ s designated person ( legal or natural person ) pursuant to the Lender ’ s exercise of its right to acquire the Borrower Equity Interest under the Exclusive Option Agreement .

<response> 1 . 4 <person>Lender</person> and <person>Borrower</person> hereby agree and acknowledge that <person>Borrower</person> ’ s method of repayment may at <person>Lender</person> ’ s option take the form of <person>Borrower</person> ’ s transferring the <person>Borrower</person> Equity Interest to <person>Lender</person> or <person>Lender</person> ’ s designated person ( legal or natural person ) pursuant to the <person>Lender</person> ’ s exercise of its right to acquire the <person>Borrower</person> Equity Interest under the Exclusive Option Agreement . </response>


1 . 5 Lender and Borrower hereby agree and acknowledge that any proceeds from the transfer of the Borrower Equity Interest ( to the extent permissible ) shall be used to repay the Loan to Lender , in accordance with this Agreement in the manner designated by Lender .

<response> 1 . 5 <person>Lender</person> and <person>Borrower</person> hereby agree and acknowledge that any proceeds from the transfer of the <person>Borrower</person> Equity Interest ( to the extent permissible ) shall be used to repay the Loan to <person>Lender</person> , in accordance with this Agreement in the manner designated by <person>Lender</person> . </response>


2 1 . 6 Lender and Borrower hereby agree and acknowledge that to the extent permitted by applicable laws , Lender shall have the right but not the obligation to purchase or designate other persons ( legal or natural persons ) to purchase Borrower Equity Interest in part or in whole at any time , at the price stipulated in the Exclusive Option Agreement .

<response> 2 1 . 6 <person>Lender</person> and <person>Borrower</person> hereby agree and acknowledge that to the extent permitted by applicable laws , <person>Lender</person> shall have the right but not the obligation to purchase or designate other persons ( legal or natural persons ) to purchase <person>Borrower</person> Equity Interest in part or in whole at any time , at the price stipulated in the Exclusive Option Agreement . </response>


1 . 7 Borrower also undertakes to execute an irrevocable Power of Attorney ( the “ Power of Attorney ”, referred to in Section 4 . 2 . 4 ), which authorizes a legal or natural person designated by Lender to exercise all of Borrower ’ s rights as a shareholder of Borrower Company .

<response> 1 . 7 <person>Borrower</person> also undertakes to execute an irrevocable Power of Attorney ( the “ Power of Attorney ”, referred to in Section 4 . 2 . 4 ), which authorizes a legal or natural person designated by <person>Lender</person> to exercise all of <person>Borrower</person> ’ s rights as a shareholder of <person>Borrower</person> Company . </response>


1 . 8 When Borrower transfers Borrower Equity Interest to Lender or Lender ’ s designated person , in the event that the transfer price of such equity interest equals or is lower than the principal of the Loan under this Agreement , the Loan under this Agreement shall be deemed an interest - free loan .

<response> 1 . 8 When <person>Borrower</person> transfers <person>Borrower</person> Equity Interest to <person>Lender</person> or <person>Lender</person> ’ s designated person , in the event that the transfer price of such equity interest equals or is lower than the principal of the Loan under this Agreement , the Loan under this Agreement shall be deemed an interest - free loan . </response>


In the event that the transfer price of such equity interest exceeds the principal of the Loan under this Agreement , the excess over the principal shall be deemed the interest of the Loan under this Agreement payable by Borrower to Lender .

<response> In the event that the transfer price of such equity interest exceeds the principal of the Loan under this Agreement , the excess over the principal shall be deemed the interest of the Loan under this Agreement payable by <person>Borrower</person> to <person>Lender</person> . </response>


2 Conditions Precedent

<response> 2 Conditions Precedent </response>


The obligation of Lender to provide the Loan to Borrower contemplated in Section 1 . 1 shall be subject to the satisfaction of the following conditions , unless waived in writing by Lender .

<response> The obligation of <person>Lender</person> to provide the Loan to <person>Borrower</person> contemplated in Section 1 . 1 shall be subject to the satisfaction of the following conditions , unless waived in writing by <person>Lender</person> . </response>


2 . 1 Lender receives the written notification for drawdown under the Loan sent by Borrower according to Section 1 . 2 .

<response> 2 . 1 <person>Lender</person> receives the written notification for drawdown under the Loan sent by <person>Borrower</person> according to Section 1 . 2 . </response>


2 . 2 All the representations and warranties by Borrower in Section 3 . 2 are true , complete , correct and not misleading .

<response> 2 . 2 All the representations and warranties by <person>Borrower</person> in Section 3 . 2 are true , complete , correct and not misleading . </response>


2 . 3 Borrower has not violated the covenants in Section 4 of this Agreement , and no event which may affect Borrower ’ s performance of its obligations under this Agreement has occurred or is expected to occur .

<response> 2 . 3 <person>Borrower</person> has not violated the covenants in Section 4 of this Agreement , and no event which may affect <person>Borrower</person> ’ s performance of its obligations under this Agreement has occurred or is expected to occur . </response>


3 Representations and Warranties

<response> 3 Representations and Warranties </response>


3 . 1 Between the date of this Agreement and the date of termination of this Agreement , Lender hereby makes the following representations and warranties to Borrower :

<response> 3 . 1 Between the date of this Agreement and the date of termination of this Agreement , <person>Lender</person> hereby makes the following representations and warranties to <person>Borrower</person> : </response>


3 . 1 . 1 Lender is a company duly organized and legally existing in accordance with the laws of China ;

<response> 3 . 1 . 1 <person>Lender</person> is a company duly organized and legally existing in accordance with the laws of <location>China</location> ; </response>


3 3 . 1 . 2 Lender has the legal capacity to execute and perform this Agreement .

<response> 3 3 . 1 . 2 <person>Lender</person> has the legal capacity to execute and perform this Agreement . </response>


The execution and performance by Lender of this Agreement is consistent with Lender ’ s scope of business and the provisions of Lender ’ s corporate bylaws and other organizational documents , and Lender has obtained all necessary and proper approvals and authorizations for the execution and performance of this Agreement ; and

<response> The execution and performance by <person>Lender</person> of this Agreement is consistent with <person>Lender</person> ’ s scope of business and the provisions of <person>Lender</person> ’ s corporate bylaws and other organizational documents , and <person>Lender</person> has obtained all necessary and proper approvals and authorizations for the execution and performance of this Agreement ; and </response>


3 . 1 . 3 This Agreement constitutes Lender ’ s legal , valid and binding obligations , enforceable in accordance with its terms .

<response> 3 . 1 . 3 This Agreement constitutes <person>Lender</person> ’ s legal , valid and binding obligations , enforceable in accordance with its terms . </response>


3 . 2 Between the date of this Agreement and the date of termination of this Agreement , Borrower hereby makes the following representations and warranties :

<response> 3 . 2 Between the date of this Agreement and the date of termination of this Agreement , <person>Borrower</person> hereby makes the following representations and warranties : </response>


3 . 2 . 1 Borrower has the legal capacity to execute and perform this Agreement .

<response> 3 . 2 . 1 <person>Borrower</person> has the legal capacity to execute and perform this Agreement . </response>


Borrower has obtained all necessary and proper approvals and authorizations for the execution and performance of this Agreement ;

<response> <person>Borrower</person> has obtained all necessary and proper approvals and authorizations for the execution and performance of this Agreement ; </response>


3 . 2 . 2 This Agreement constitutes Borrower ’ s legal , valid and binding obligations enforceable in accordance with its terms ; and

<response> 3 . 2 . 2 This Agreement constitutes <person>Borrower</person> ’ s legal , valid and binding obligations enforceable in accordance with its terms ; and </response>


3 . 2 . 3 There are no disputes , litigation , arbitrations , administrative proceedings or any other legal proceedings relating to Borrower , nor are there any potential disputes , litigations , arbitrations , administrative proceedings or any other legal proceedings relating to Borrower .

<response> 3 . 2 . 3 There are no disputes , litigation , arbitrations , administrative proceedings or any other legal proceedings relating to <person>Borrower</person> , nor are there any potential disputes , litigations , arbitrations , administrative proceedings or any other legal proceedings relating to <person>Borrower</person> . </response>


4 Borrower ’ s Covenants

<response> 4 <person>Borrower</person> ’ s Covenants </response>


4 . 1 As a shareholder of Borrower Company , Borrower covenants that during the term of this Agreement , Borrower shall cause Borrower Company :

<response> 4 . 1 As a shareholder of <person>Borrower</person> Company , <person>Borrower</person> covenants that during the term of this Agreement , <person>Borrower</person> shall cause <person>Borrower</person> Company : </response>


4 . 1 . 1 to execute the Exclusive Option Agreement with Borrower and Lender , under which Borrower shall irrevocably grant Lender an exclusive option to purchase all of the Borrower Equity Interest ; to execute an Exclusive Business Cooperation Agreement (“ Exclusive Business Cooperation Agreement ”) with Lender ( or a party designated by Lender ), under which Lender ( or a party designated by Lender ), as an exclusive service provider , will provide Borrower Company with technical service and business consulting service ; to enter into the Exclusive Option Agreement and the Exclusive Business Cooperation Agreement on the date of issuance of the business license to Borrower Company , and to complete all the related governmental approvals , registrations or fillings ( as applicable );

<response> 4 . 1 . 1 to execute the Exclusive Option Agreement with <person>Borrower</person> and <person>Lender</person> , under which <person>Borrower</person> shall irrevocably grant <person>Lender</person> an exclusive option to purchase all of the <person>Borrower</person> Equity Interest ; to execute an Exclusive Business Cooperation Agreement (“ Exclusive Business Cooperation Agreement ”) with <person>Lender</person> ( or a party designated by <person>Lender</person> ), under which <person>Lender</person> ( or a party designated by <person>Lender</person> ), as an exclusive service provider , will provide <person>Borrower</person> Company with technical service and business consulting service ; to enter into the Exclusive Option Agreement and the Exclusive Business Cooperation Agreement on the date of issuance of the business license to <person>Borrower</person> Company , and to complete all the related governmental approvals , registrations or fillings ( as applicable ); </response>


<response> 4 4 . 1 . 2 to strictly abide by the provisions of the Exclusive Option Agreement and the Exclusive Business Cooperation Agreement , and to refrain from any action or omission that may affect the effectiveness and enforceability of the Exclusive Option Agreement and the Exclusive Business Cooperation Agreement ; </response>


4 . 1 . 3 at the request of Lender ( or a party designated by Lender ), to execute contracts or agreements on business cooperation with Lender ( or a party designated by Lender ), and to strictly abide by such contracts or agreements ;

<response> 4 . 1 . 3 at the request of <person>Lender</person> ( or a party designated by <person>Lender</person> ), to execute contracts or agreements on business cooperation with <person>Lender</person> ( or a party designated by <person>Lender</person> ), and to strictly abide by such contracts or agreements ; </response>


4 . 1 . 4 without Lender ’ s prior written consent , not to supplement , change or amend its articles of association in any manner , increase or decrease its registered capital or change its share capital structure in any manner ;

<response> 4 . 1 . 4 without <person>Lender</person> ’ s prior written consent , not to supplement , change or amend its articles of association in any manner , increase or decrease its registered capital or change its share capital structure in any manner ; </response>


<response> 4 . 1 . 5 to maintain its corporate existence in accordance with good financial and business standards and practices by prudently and effectively operating its business and handling its affairs ; </response>


4 . 1 . 6 without Lender ’ s prior written consent , not to sell , transfer , mortgage or dispose of in any other manner its legal or beneficial interest in any of its assets , business or revenue at any time from the date of this Agreement , or permit the encumbrance of any other security interest thereon ;

<response> 4 . 1 . 6 without <person>Lender</person> ’ s prior written consent , not to sell , transfer , mortgage or dispose of in any other manner its legal or beneficial interest in any of its assets , business or revenue at any time from the date of this Agreement , or permit the encumbrance of any other security interest thereon ; </response>


4 . 1 . 7 without Lender ’ s prior written consent , not to incur , inherit , guarantee or otherwise allow for the existence of any debt , except for ( i ) debt incurred in the ordinary course of business other than through loans ; and ( ii ) debt already disclosed to Lender for which Lender ’ s written consent has been obtained ;

<response> 4 . 1 . 7 without <person>Lender</person> ’ s prior written consent , not to incur , inherit , guarantee or otherwise allow for the existence of any debt , except for ( i ) debt incurred in the ordinary course of business other than through loans ; and ( ii ) debt already disclosed to <person>Lender</person> for which <person>Lender</person> ’ s written consent has been obtained ; </response>


<response> 4 . 1 . 8 to operate its business in the ordinary course and to maintain the value of its assets ; </response>


4 . 1 . 9 without the prior written consent of Lender , not to execute any major contract , except for contracts in the ordinary course of business ( for purpose of this subsection , a contract with a value exceeding RMB100 , 000 shall be deemed a major contract );

<response> 4 . 1 . 9 without the prior written consent of <person>Lender</person> , not to execute any major contract , except for contracts in the ordinary course of business ( for purpose of this subsection , a contract with a value exceeding RMB100 , 000 shall be deemed a major contract ); </response>


4 . 1 . 10 without the prior written consent of Lender , not to provide any person with any loan or credit ;

<response> 4 . 1 . 10 without the prior written consent of <person>Lender</person> , not to provide any person with any loan or credit ; </response>


4 . 1 . 11 without the prior written consent of Lender , not to merge , consolidate with , acquire , or invest in any person ;

<response> 4 . 1 . 11 without the prior written consent of <person>Lender</person> , not to merge , consolidate with , acquire , or invest in any person ; </response>


<response> 4 . 1 . 12 to maintain the ownership of all of its assets , execute all necessary or appropriate documents , take all necessary or appropriate actions and file all necessary or appropriate complaints or raise necessary and appropriate defenses against all claims ; </response>


5 4 . 1 . 13 without the prior written consent of Lender or unless requested by Lender , not to distribute dividends to shareholders ;

<response> 5 4 . 1 . 13 without the prior written consent of <person>Lender</person> or unless requested by <person>Lender</person> , not to distribute dividends to shareholders ; </response>


4 . 1 . 14 to provide Lender with all of the information on Borrower Company ’ s business operations and financial condition at Lender ’ s request ;

<response> 4 . 1 . 14 to provide <person>Lender</person> with all of the information on <person>Borrower</person> Company ’ s business operations and financial condition at <person>Lender</person> ’ s request ; </response>


4 . 1 . 15 to immediately notify Lender of the occurrence or possible occurrence of any litigation , arbitration or administrative proceedings relating to Borrower Company ’ s assets , business or income ;

<response> 4 . 1 . 15 to immediately notify <person>Lender</person> of the occurrence or possible occurrence of any litigation , arbitration or administrative proceedings relating to <person>Borrower</person> Company ’ s assets , business or income ; </response>


4 . 1 . 16 at the request of Lender , to appoint any persons designated by Lender as directors of Borrower Company .

<response> 4 . 1 . 16 at the request of <person>Lender</person> , to appoint any persons designated by <person>Lender</person> as directors of <person>Borrower</person> Company . </response>


4 . 2 Borrower covenants that during the term of this Agreement , he shall :

<response> 4 . 2 <person>Borrower</person> covenants that during the term of this Agreement , he shall : </response>


4 . 2 . 1 ensure that Borrower Company shall be set up within 20 working days after receiving the Loan , according to the laws of China , and take all steps necessary to ensure that Borrower Company maintains its legal existence according to the laws of China ; Borrower Company shall be a limited liability company without foreign investment , and its registered capital shall be Renminbi Twenty Four Million ( RMB24 , 000 , 000 . 00 ) and Borrower shall own 25 % of the equity interest of Borrower Company .

<response> 4 . 2 . 1 ensure that <person>Borrower</person> Company shall be set up within 20 working days after receiving the Loan , according to the laws of <location>China</location> , and take all steps necessary to ensure that <person>Borrower</person> Company maintains its legal existence according to the laws of <location>China</location> ; <person>Borrower</person> Company shall be a limited liability company without foreign investment , and its registered capital shall be Renminbi Twenty Four Million ( RMB24 , 000 , 000 . 00 ) and <person>Borrower</person> shall own 25 % of the equity interest of <person>Borrower</person> Company . </response>


4 . 2 . 2 pay its contribution of 25 % of the registered capital of Borrower Company in full in accordance with the laws of China , and provide Lender with the business license and a capital contribution verification report regarding paid - in capital contributions from a qualified accounting firm ;

<response> 4 . 2 . 2 pay its contribution of 25 % of the registered capital of <person>Borrower</person> Company in full in accordance with the laws of <location>China</location> , and provide <person>Lender</person> with the business license and a capital contribution verification report regarding paid - in capital contributions from a qualified accounting firm ; </response>


4 . 2 . 3 cause Borrower Company to engage in the security service business , and complete all the government approvals , authorizations , licensing , registration and filing required for engaging in the security service business pursuant to the laws of China ; Borrower shall provide Lender with all the said governmental approvals for verification ;

<response> 4 . 2 . 3 cause <person>Borrower</person> Company to engage in the security service business , and complete all the government approvals , authorizations , licensing , registration and filing required for engaging in the security service business pursuant to the laws of <location>China</location> ; <person>Borrower</person> shall provide <person>Lender</person> with all the said governmental approvals for verification ; </response>


4 . 2 . 4 execute an irrevocable Power of Attorney , which authorizes a legal or natural person designated by Lender to exercise all of Borrower ’ s rights as a shareholder in Borrower Company , and refrain from exercising any such shareholder rights except to the extent required under this Agreement or the Share Pledge Agreement or as requested by Lender ;

<response> 4 . 2 . 4 execute an irrevocable Power of Attorney , which authorizes a legal or natural person designated by <person>Lender</person> to exercise all of <person>Borrower</person> ’ s rights as a shareholder in <person>Borrower</person> Company , and refrain from exercising any such shareholder rights except to the extent required under this Agreement or the Share Pledge Agreement or as requested by <person>Lender</person> ; </response>


4 . 2 . 5 execute the Exclusive Option Agreement with Lender and Borrower Company , under which Borrower shall irrevocably grant to Lender an exclusive option to purchase all of the Borrower Equity Interest ;

<response> 4 . 2 . 5 execute the Exclusive Option Agreement with <person>Lender</person> and <person>Borrower</person> Company , under which <person>Borrower</person> shall irrevocably grant to <person>Lender</person> an exclusive option to purchase all of the <person>Borrower</person> Equity Interest ; </response>


6 4 . 2 . 6 execute a Share Pledge Agreement ( the “ Share Pledge Agreement ”) with Lender , under which Borrower shall pledge the Borrower Equity Interest to Lender ;

<response> 6 4 . 2 . 6 execute a Share Pledge Agreement ( the “ Share Pledge Agreement ”) with <person>Lender</person> , under which <person>Borrower</person> shall pledge the <person>Borrower</person> Equity Interest to <person>Lender</person> ; </response>


4 . 2 . 7 enter into the aforementioned Power of Attorney , Exclusive Option Agreement and Share Pledge Agreement on the date of the issuance of the business license to Borrower Company , and complete all the related governmental approvals , registrations or fillings ( as applicable );

<response> 4 . 2 . 7 enter into the aforementioned Power of Attorney , Exclusive Option Agreement and Share Pledge Agreement on the date of the issuance of the business license to <person>Borrower</person> Company , and complete all the related governmental approvals , registrations or fillings ( as applicable ); </response>


<response> 4 . 2 . 8 abide by the provisions of this Agreement , the Power of Attorney , the Share Pledge Agreement and the Exclusive Option Agreement , perform his obligations under this Agreement , the Power of Attorney , the Share Pledge Agreement and the Exclusive Option Agreement , and refrain from any action or omission that may affect the effectiveness and enforceability of this Agreement , the Share Pledge Agreement and the Exclusive Option Agreement ; </response>