GUARANTEE AND COLLATERAL AGREEMENT dated as of March 31, 2009, among HARMAN INTERNATIONAL INDUSTRIES, INCORPORATED HARMAN HOLDING GMBH & CO. KG THE SUBSIDIARIES OF HARMAN INTERNATIONAL INDUSTRIES, INCORPORATED IDENTIFIED HEREIN and JPMORGAN CHASE...
Exhibit
10.2
dated as
of
March 31,
2009,
among
XXXXXX
INTERNATIONAL INDUSTRIES, INCORPORATED
XXXXXX
HOLDING GMBH & CO. KG
THE
SUBSIDIARIES OF XXXXXX INTERNATIONAL INDUSTRIES, INCORPORATED
IDENTIFIED
HEREIN
and
JPMORGAN
CHASE BANK, N.A.,
as
Administrative Agent
TABLE OF
CONTENTS
ARTICLE
I
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|||
Definitions
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|||
SECTION
1.01.
|
Defined
Terms
|
1
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SECTION
1.02.
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Other
Defined Terms
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1
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|
SECTION
1.03.
|
Inconsistencies
with Foreign Agreements or Foreign Law
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8
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ARTICLE
II
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|||
Guarantees
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|||
SECTION
2.01.
|
Guarantees
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8
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SECTION
2.02.
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Guarantee
of Payment; Continuing Guarantee
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8
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SECTION
2.03.
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No
Limitations
|
9
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SECTION
2.04.
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German
Guarantee Limitations
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10
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SECTION
2.05.
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Reinstatement
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13
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SECTION
2.06.
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Agreement
to Pay; Subrogation
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13
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SECTION
2.07.
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Information
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13
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ARTICLE
III
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Pledge
of Certain Securities
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SECTION
3.01.
|
Pledge
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13
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SECTION
3.02.
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Delivery
of the Pledged Collateral
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14
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SECTION
3.03.
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Representations,
Warranties and Covenants
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15
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SECTION
3.04.
|
Certification
of Limited Liability Company and Limited Partnership
Interests
|
17
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SECTION
3.05.
|
Unlimited
Liability Companies
|
17
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SECTION
3.06.
|
Registration
in Nominee Name; Denominations
|
17
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SECTION
3.07.
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Voting
Rights; Dividends and Interest
|
18
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ARTICLE
IV
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Security
Interests in Personal Property
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|||
SECTION
4.01.
|
Security
Interest
|
20
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SECTION
4.02.
|
Representations
and Warranties
|
22
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SECTION
4.03.
|
Covenants
|
25
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|
SECTION
4.04.
|
Other
Actions
|
27
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|
SECTION
4.05.
|
Covenants
Regarding Intellectual Property Collateral
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29
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SECTION
4.06.
|
Cash
Collateral Accounts
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31
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ARTICLE
V
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|||
Remedies
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|||
SECTION
5.01.
|
Remedies
Upon Default
|
31
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SECTION
5.02.
|
Application
of Proceeds
|
33
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|
SECTION
5.03.
|
Grant
of License to Use Intellectual Property
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34
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SECTION
5.04.
|
Securities
Act
|
34
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ARTICLE
VI
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|||
Indemnity,
Subrogation and Subordination
|
|||
SECTION
6.01.
|
Indemnity
and Subrogation
|
35
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|
SECTION
6.02.
|
Contribution
and Subrogation
|
35
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|
SECTION
6.03.
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Limitations,
Subordination
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36
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ARTICLE
VII
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Miscellaneous
|
|||
SECTION
7.01.
|
Notices
|
36
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SECTION
7.02.
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Waivers;
Amendment
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36
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SECTION
7.03.
|
Administrative
Agent’s Fees and Expenses; Indemnification
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37
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SECTION
7.04.
|
Successors
and Assigns
|
38
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SECTION
7.05.
|
Survival
of Agreement
|
38
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SECTION
7.06.
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Counterparts;
Effectiveness; Several Agreement
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38
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SECTION
7.07.
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Severability;
Limitation by Law
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38
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SECTION
7.08.
|
Right
of Set-Off
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39
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|
SECTION
7.09
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Governing
Law; Jurisdiction; Consent to Service of Process
|
39
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|
SECTION
7.10.
|
WAIVER
OF JURY TRIAL
|
40
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|
SECTION
7.11.
|
Headings
|
40
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|
SECTION
7.12.
|
Security
Interest Absolute
|
40
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|
SECTION
7.13.
|
Attachment
of Security Interest
|
41
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|
SECTION
7.14.
|
Copy
of Agreement; Verification Statement
|
41
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SECTION
7.15.
|
No
Subordination
|
41
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|
SECTION
7.16.
|
Termination
or Release
|
41
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|
SECTION
7.17.
|
Additional
Subsidiaries
|
42
|
|
SECTION
7.18.
|
Administrative
Agent Appointed Attorney-in-Fact
|
42
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|
SECTION
7.19.
|
Xxxxxx
International Guarantee
|
43
|
Schedules
Schedule
I
|
Subsidiary
Loan Parties
|
Schedule
II
|
Pledged
Stock; Pledged Debt Securities
|
Schedule
III
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Intellectual
Property
|
Schedule
IV
|
Commercial
Tort Claims
|
Exhibits
Exhibit
I
|
Form
of Supplement
|
Exhibit
II
|
Form
of Perfection Certificate
|
Exhibit
III
|
Form
of Patent and Trademark Security
Agreement
|
Exhibit
IV
|
Form
of Copyright Security Agreement
|
GUARANTEE
AND COLLATERAL AGREEMENT dated as of March 31, 2009 (this “Agreement”), among
XXXXXX INTERNATIONAL INDUSTRIES, INCORPORATED, XXXXXX HOLDING GMBH & CO. KG,
the Subsidiaries from time to time party hereto and JPMORGAN CHASE BANK, N.A.,
as Administrative Agent.
Reference
is made to the Second Amended and Restated Multi-Currency, Multi-Option Credit
Agreement dated as of March 31, 2009 (as amended, supplemented or otherwise
modified from time to time, the “Credit Agreement”),
among Xxxxxx International Industries, Incorporated, a Delaware corporation (the
“Company”),
Xxxxxx Holding GmbH & Co. KG, a company organized under the laws of Germany
(the “Additional
Borrower”), the Lenders party thereto, the other parties thereto and
JPMorgan Chase Bank, N.A., as Administrative Agent, and to the Guarantee
Agreement (the “Xxxxxx
International Guarantee”) dated as of June 22, 2006, made by the Company
in favor of JPMorgan Chase Bank, N.A., as administrative agent for the several
banks and other financial institutions or entities party to the Existing Credit
Agreement.
The
Extended Tranche Lenders have agreed to make certain accommodations under the
Credit Agreement and to continue to extend credit to the Borrowers subject to
the terms and conditions set forth in the Credit Agreement. The
obligations of the Extended Tranche Lenders to make such accommodations and to
continue to extend such credit are conditioned upon, among other things, the
execution and delivery of this Agreement. The Subsidiary Loan Parties
are Affiliates of the Borrowers, will derive substantial benefits from such
accommodations under the Credit Agreement and the continued extension of credit
to the Borrowers pursuant to the Credit Agreement and are willing to execute and
deliver this Agreement in order to induce the Extended Tranche Lenders to make
such accommodations under the Credit Agreement and to continue to extend such
credit. Accordingly, the parties hereto agree as
follows:
ARTICLE
I
Definitions
SECTION
1.01. Defined
Terms. i)Each capitalized term used but not defined herein
shall have the meaning specified in the Credit Agreement. Each term
defined in the New York UCC and not defined in this Agreement shall have the
meaning specified therein. The term “instrument” shall have the
meaning specified in Article 9 of the New York UCC.
(b) The
rules of construction specified in subsections 1.2 and 1.3 of the Credit
Agreement also apply to this Agreement, mutatis mutandis.
SECTION
1.02. Other
Defined Terms. As used in this Agreement, the following terms
have the meanings specified below:
1
“Account Debtor” means
any Person that is or may become obligated to any Grantor under, with respect to
or on account of an Account.
“Additional Borrower”
has the meaning assigned to such term in the introductory paragraph to this
Agreement.
“Agreement” has the
meaning assigned to such term in the introductory paragraph to this
Agreement.
“Article 9 Collateral”
has the meaning assigned to such term in Section 4.01.
“Auditor’s
Determination” has the meaning assigned to such term in Section
2.04(d).
“Capital Impairment”
has the meaning assigned to such term in Section 2.04.
“Capital Stock” means,
when used in this Agreement, the Capital Stock of any Subsidiary.
“Cash Collateral
Account” means a cash collateral account established at the office of
JPMORGAN CHASE BANK, N.A. located at 000 Xxxx Xxxxxx, Xxx Xxxx, XX 00000, in the
name of the Administrative Agent, for purposes of this Agreement.
“Collateral” means
Article 9 Collateral and Pledged Collateral.
“Company” has the
meaning assigned to such term in the introductory paragraph to this
Agreement.
“Contributing Party”
has the meaning assigned to such term in Section 6.02.
“Copyright License”
means any written agreement, now or hereafter in effect, granting to any third
party any right now or hereafter under any Copyright now or hereafter owned by
any Grantor or that such Grantor otherwise has the right to license, or granting
any right to any Grantor under any Copyright now or hereafter owned by any third
party, or that a third party now or hereafter otherwise has the right to license
and all rights of such Grantor under any such agreement.
“Copyrights” means,
with respect to any Grantor, all of the following now owned or hereafter
acquired by such Grantor: (a) all copyright rights including any
economic or moral rights in any work subject to the copyright laws of the United
States or any other country, whether as author, assignee, transferee or
otherwise, and (b) all registrations and applications for registration of any
such copyright in the United States or any other country, including
registrations, recordings, supplemental registrations and pending applications
for registration in the United States Copyright Office (or any similar office in
any other country), including, in the case of clauses (a) and (b), those listed
on Schedule III.
2
“Credit Agreement” has
the meaning assigned to such term in the introductory paragraph of this
Agreement.
“Deposit Account”
means any deposit account, not including any Excluded Deposit
Accounts.
“Domestic Secured
Obligations” means all the Secured Obligations of the Company and any
Domestic Subsidiary, in each case, other than in respect of any guarantee of the
obligations of any Foreign Subsidiary.
“Enforcement Notice”
has the meaning assigned to such term in Section 2.04(d).
“Extended Tranche
Obligations” means the due and punctual payment and performance (i) by
the Company of the Extended Tranche Company Obligations and (ii) by the
Additional Borrower of the Extended Tranche Additional Borrower Obligations
(including, in each case, monetary obligations incurred during the pendency of
any bankruptcy, insolvency, receivership or other similar proceeding, regardless
of whether allowed or allowable in such proceeding).
“Federal Securities
Laws” has the meaning assigned to such term in Section 5.04.
“First-Tier
Subsidiary” means any Subsidiary the Capital Stock of which is directly
owned by the Company or any other US Guarantor.
“Foreign Guarantors”
means the Additional Borrower (except with respect to the obligations of the
Additional Borrower) and each Subsidiary Loan Party that is a Foreign
Subsidiary.
“Foreign Secured
Obligations” means all the Secured Obligations of the Additional Borrower
and any Foreign Guarantor.
“German GmbH & Co. KG
Guarantor” means a Foreign Guarantor incorporated or formed under the
laws of Germany and constituted in the form of a limited partnership with a
limited liability company as general partner (GmbH & Co.
KG).
“German GmbH
Guarantor” means a Foreign Guarantor incorporated or formed under the
laws of Germany and constituted in the form of a limited liability company
(GmbH).
“German Guarantors”
means the German GmbH Guarantors and the German GmbH & Co. KG
Guarantors.
3
“Grantor” means the
Company, the Additional Borrower, the other US Guarantors and the Foreign
Guarantors.
“Guaranteed
Obligations” means:
(i) in
the case of the Additional Borrower, the obligations of the Designated Foreign
Subsidiaries in respect of all the Secured Hedging Agreement Obligations, all
the Secured Cash Management Obligations and all the Secured Other Facility
Obligations;
(ii) in
the case of the Foreign Guarantors (other than the Additional Borrower), (A) the
Extended Tranche Obligations of the Additional Borrower and (B) the obligations
of the Additional Borrower and the Designated Foreign Subsidiaries in respect of
all the Secured Hedging Agreement Obligations, all the Secured Cash Management
Obligations and all the Secured Other Facility Obligations;
(iii) in
the case of the Company, (A) the Extended Tranche Obligations of the Additional
Borrower and (B) the obligations of the other Loan Parties and the other
Subsidiaries in respect of all the Secured Hedging Agreement Obligations, all
the Secured Cash Management Obligations and all the Secured Other Facility
Obligations;
(iv) in
the case of the US Guarantors (other than the Company), (A) the Extended Tranche
Obligations of the Borrowers and (B) the obligations of the Loan Parties and the
other Subsidiaries in respect of all the Secured Hedging Agreement Obligations,
all the Secured Cash Management Obligations and all the Secured Other Facility
Obligations.
“Guarantors” means the
US Guarantors and the Foreign Guarantors.
“Xxxxxx International
Guarantee” has the meaning assigned to such term in the introductory
paragraph to this agreement.
“Harman LLC Agreement”
means the Limited Liability Company Agreement of Xxxxxx
KG Holding, LLC, dated as of March
31,
2009 (as amended, supplemented or replaced from time to
time).
“Harman Trust
Agreement” means the Trust Agreement between Xxxxxx International Industries,
Incorporated, as Trustor, and Xxxxxx KG Holding, LLC, as
Trustee, dated as of March 31, 2009 (as
amended, supplemented or replaced from time to time).
“IP Security
Agreements” has the meaning assigned to such term in Section
4.02(b).
“Intellectual
Property” means all intellectual and similar property of every kind and
nature now owned or hereafter acquired by any Grantor, including inventions,
designs, Patents, Copyrights, Licenses, Trademarks, trade secrets, domain names,
confidential or proprietary technical and business information, know-how,
show-how or other data or information, software and databases and all
embodiments or fixations thereof and related documentation, registrations and
franchises, and all additions, improvements and accessions.
4
“License” means any
Intellectual Property license or sublicense agreement to which any Grantor is a
party.
“Management
Determination” has the meaning assigned to such term in Section
2.04(d).
“New York UCC” means
the Uniform Commercial Code as from time to time in effect in the State of New
York.
“Patent License” means
any written agreement, now or hereafter in effect, granting to any third party
any right to make, use, sell, offer for sale or import any invention on which a
Patent, now or hereafter owned by any Grantor or that any Grantor now or
hereafter otherwise has the right to license, is in existence, or granting to
any Grantor any right to make, use, sell, offer for sale or import any invention
on which a patent, now or hereafter owned by any third party, is in existence,
and all rights of any Grantor under any such agreement.
“Patents” means all of
the following now owned or hereafter acquired by such Grantor: (a)
all pending patent applications or issued patents of the United States or any
foreign country, all registrations and recordings thereof, including those
listed on Schedule III, and (b) all continuation applications, divisional
applications, continuation-in-part applications, those issued patents that are
subject to reissue or reexamination certificates, and the inventions disclosed
or claimed therein, including the right to make, use sell, offer for sale or
import the inventions.
“Payment Obligation”
has the meaning assigned to such term in Section 2.04(a).
“Perfection
Certificate” means a certificate substantially in the form of Exhibit II,
completed and supplemented with the schedules and attachments contemplated
thereby, and duly executed by a Responsible Officer and the chief legal officer
of the Company.
“Permitted Liens” has
the meaning assigned to such term in Section 3.03.
“Pledged Collateral”
has the meaning assigned to such term in Section 3.01.
“Pledged Debt
Securities” has the meaning assigned to such term in Section
3.01.
“Pledged Securities”
means any promissory notes, stock certificates, or other certificated securities
now or hereafter included in the Pledged Collateral, including all certificates,
instruments or other documents representing or evidencing any Pledged
Collateral.
5
“Pledged Stock” has
the meaning assigned to such term in Section 3.01.
“PPSA” means the Personal Property Security
Act (Ontario), including the regulations thereto, provided that, if
perfection or the effect of perfection or non-perfection or the priority of any
Lien created hereunder on the Collateral is governed by the personal property
security legislation or other applicable legislation with respect to personal
property security as in effect in a jurisdiction other than Ontario, “PPSA”
means the Personal Property Security Act or such other applicable legislation as
in effect from time to time in such other jurisdiction for purposes of the
provisions hereof relating to such perfection, effect of perfection or
non-perfection or priority.
“Qualified CFC Holding
Company” means any Wholly Owned Subsidiary of the Company or any
Subsidiary Loan Party that is treated as a disregarded entity for U.S. federal
income tax purposes, that (a) is in compliance with Qualified CFC Holding
Company Limitation and (b) the primary asset of which consists of Capital Stock
in either (i) a Foreign Subsidiary or (ii) a Delaware limited liability company
that is in compliance with the Qualified CFC Holding Company Limitation and the
primary asset of which consists of Capital Stock in a Foreign
Subsidiary.
“Qualified CFC Holding
Company Limitation” means that any Person (a) shall not have created,
incurred or assumed any Indebtedness or created, incurred, assumed or suffered
to exist any Lien on any of its assets except for Liens or Indebtedness created
under the Loan Documents and (b) does not engage in any business or activity or
acquire or hold any assets other than the Capital Stock of one or more Foreign
Subsidiaries of the Company and/or one or more other Qualified CFC Holding
Companies and the receipt and distribution of dividends and distributions in
respect thereof.
“Secured Cash Management
Obligations” means any obligations of any Loan Party in respect of
overdrafts or other liabilities owed to an Extended Tranche Lender or an
Affiliate of an Extended Tranche Lender arising from treasury, depository or
cash management services.
“Secured Hedging Agreement
Obligations” means all obligations of each Loan Party under each Hedging
Agreement that is (i) in effect on the Restatement Effective Date with a
counterparty that is an Extended Tranche Lender or an Affiliate of an Extended
Tranche Lender as of the Restatement Effective Date or (ii) entered into after
the Restatement Effective Date with any counterparty that is an Extended Tranche
Lender or an Affiliate of an Extended Tranche Lender at the time such Hedging
Agreement is entered into.
“Secured Obligations”
means, with respect to any Grantor, its Extended Tranche Obligations, its
Secured Cash Management Obligations, its Secured Hedging Agreement Obligations,
its Secured Other Facility Obligations and its Guaranteed Obligations, as
applicable.
6
“Secured Other Facility
Obligations” means any Indebtedness or other financial obligations owed
to any Extended Tranche Lender or Affiliate of an Extended Tranche Lender under
any line of credit or other bilateral credit facility extended by such Extended
Tranche Lender or Affiliate to the Company or a Subsidiary, but only to the
extent such Indebtedness shall have been incurred in compliance with the
provisions of the Credit Agreement.
“Secured Parties”
means (a) the Extended Tranche Lenders, (b) the Administrative Agent, (c) the
Issuing Bank, (d) each provider of treasury, depository or cash management
services the liabilities in respect of which constitute Secured Obligations, (e)
each counterparty to any Hedging Agreement with a Loan Party the obligations
under which constitute Secured Hedging Agreement Obligations, (f) each provider
of any line of credit or other bilateral credit facility the obligations under
which constitute Secured Other Facility Obligations, (g) each other person to
which any Secured Obligation is owed and (h) the successors and assigns of each
of the foregoing.
“Security Interest”
has the meaning assigned to such term in Section 4.01(a).
“Subsidiary Loan
Party” means each Subsidiary that is a party hereto on the date hereof
and each Subsidiary that becomes a party hereto pursuant to Section
7.17.
“Trademark License”
means any written agreement, now or hereafter in effect, granting to any Grantor
any right to use any Trademark now or hereafter owned by any third party
(including, without limitation, any such rights that such Grantor has the right
to license).
“Trademarks” means all
of the following now owned or hereafter acquired by any Grantor: (a) all
trademarks, service marks, trade names, corporate names, company names, business
names, fictitious business names, trade styles, trade dress, logos, other source
or business identifiers, designs and general intangibles of like nature, now
existing or hereafter adopted or acquired, including all common law rights,
applications or registrations filed in the United States Patent and Trademark
Office, any similar offices in any State of the United States, any other country
or any political subdivision (except for “intent-to-use” applications for
trademark or service xxxx registrations filed pursuant to Section 1(b) of the
Xxxxxx Act, 15 U.S.C. § 1051, unless and until an Amendment to Allege Use or a
Statement of Use under Sections 1(c) and 1(d) of Xxxxxx Act has been filed, to
the extent, if any, that any assignment of an “intent-to-use” application prior
to such filing would violate the Xxxxxx Act), and all related extensions or
renewals, including those listed on Schedule III, (b) all associated goodwill
and (c) all other intangible assets, rights and interests that uniquely reflect
or embody such goodwill.
7
“US Guarantors” means
the Company (except with respect to the obligations of the Company) and each
Subsidiary Loan Party that is not a Foreign Subsidiary.
SECTION
1.03. Inconsistencies with Foreign
Agreements or Foreign Law. Notwithstanding any other provision
contained herein, in the event that any agreement made by any Grantor in this
Agreement, or any right of the Administrative Agent under this Agreement, (a)
shall be inconsistent with the provisions of any Foreign Pledge Agreement
covering Pledged Stock of such Grantor or the provisions of any Collateral
Document governed by foreign law with respect to the grant of a security
interest in the Collateral owned by such Grantor, the provisions of such Foreign
Pledge Agreement or such Collateral Document will control and, to the extent of
such inconsistency, no Default or Event of Default will be deemed to occur as a
result of any Grantor’s non-compliance with the applicable agreement contained
herein; or (b) shall be contrary to the laws of the jurisdiction of organization
of any Foreign Subsidiary that is the issuer of any Pledged Stock or owner of
any Collateral, such agreement or right will, insofar as it relates to the
Pledged Stock issued by such Foreign Subsidiary or any Collateral owned by such
Foreign Subsidiary and to the extent of such contrariety, be of no force or
effect. Notwithstanding anything herein or in any Loan Document to
the contrary, no Borrower nor any other Loan Party makes any representation or
warranty as to the effects of perfection or non-perfection, the priority or
enforceability of any pledge of or security interest in any assets (including
Capital Stock) of any Foreign Subsidiary, or as to the rights and remedies of
the Administrative Agent or any Lender with respect thereto, in each case under
any foreign law (other than, in the case of any other Loan Document, the laws of
the jurisdiction by which such Loan Document is governed).
ARTICLE
II
Guarantees
SECTION
2.01. Guarantees. Each
Guarantor unconditionally and irrevocably guarantees, jointly with the other
Guarantors and severally, to the Administrative Agent, for the ratable benefit
of the Secured Parties, as a primary obligor and not merely as a surety, the due
and punctual payment and performance of its Guaranteed
Obligations. Each Guarantor further agrees that its Guaranteed
Obligations may be extended or renewed, in whole or in part, without notice to
or further assent from it, and that it will remain bound upon its guarantee
notwithstanding any extension or renewal of any Guaranteed
Obligation. Each Guarantor waives presentment to, demand of payment
from and protest to any Borrower or any other Loan Party of any of the
Guaranteed Obligations, and also waives notice of acceptance of its guarantee
and notice of protest for nonpayment.
SECTION
2.02. Guarantee of Payment;
Continuing Guarantee. i)Each Guarantor further agrees that its
guarantee hereunder constitutes a guarantee of payment when due (whether or not
any bankruptcy or similar proceeding shall have stayed the accrual of collection
of any of the Guaranteed Obligations or operated as a discharge thereof) and not
merely of collection, and waives any right to require that any resort be had by
the Administrative Agent or any other Secured Party to any security held for the
payment of the Guaranteed Obligations or to any balance of any deposit account
or credit on the books of the Administrative Agent or any other Secured Party in
favor of the Borrowers, any other party, or any other Person. Each
Guarantor agrees that its guarantee hereunder is continuing in nature and
applies to all of its Guaranteed Obligations, whether currently existing or
hereafter incurred.
8
(b) As
an original and independent obligation under this guarantee, each Guarantor
shall:
(i)
indemnify the Administrative Agent and each other Secured Party and its
successors, endorsees, transferees and assigns and keep the Administrative Agent
and each other Secured Party indemnified against all costs, losses, expenses and
liabilities of whatever kind resulting from the failure of such Guarantor’s
Secured Obligation to be paid when due or resulting from any of such Secured
Obligations being or becoming void, voidable, unenforceable or ineffective
against any Loan Party liable therefor (including, but without limitation, all
legal and other costs, charges and expenses incurred by each Secured Party, or
any of them, in connection with preserving or enforcing, or attempting to
preserve or enforce, its rights under this guarantee); and
(ii) pay
on demand the amount of such costs, losses, expenses and liabilities whether or
not the Administrative Agent or any of the other Secured Parties has attempted
to enforce any rights against any Loan Party or any other Person or
otherwise.
SECTION
2.03. No
Limitations. i)Subject to Section 2.04 and except for
termination of a Guarantor’s obligations hereunder as expressly provided in
Section 7.16, the obligations of each Guarantor hereunder shall not be subject
to any reduction, limitation, impairment or termination for any reason,
including any claim of waiver, release, surrender, alteration or compromise, and
shall not be subject to any defense or set-off, counterclaim, recoupment or
termination whatsoever by reason of the invalidity, illegality or
unenforceability of the Guaranteed Obligations, any impossibility in the
performance of the Guaranteed Obligations, or otherwise. Without
limiting the generality of the foregoing, the obligations of each Guarantor
hereunder shall not be discharged or impaired or otherwise affected by (i) the
failure of the Administrative Agent or any other Secured Party to assert any
claim or demand or to enforce any right or remedy under the provisions of any
Loan Document or otherwise; (ii) any rescission, waiver, amendment or
modification of, or any release from any of the terms or provisions of, any Loan
Document or any other agreement, including with respect to any other Guarantor
under this Agreement; (iii) the release of any security held by the
Administrative Agent or any other Secured Party for the Guaranteed Obligations
or any of them; (iv) any default, failure or delay, wilful or otherwise, in the
performance of the Guaranteed Obligations; or (v) any other act or omission that
may or might in any manner or to any extent vary the risk of any Guarantor or
otherwise operate as a discharge of any Guarantor as a matter of law or equity
(other than the indefeasible payment in full in cash of all the Guaranteed
Obligations). Each Guarantor expressly authorizes the Secured Parties
to take and hold security for the payment and performance of the Guaranteed
Obligations, to exchange, waive or release any or all such security (with or
without consideration), to enforce or apply such security and direct the order
and manner of any sale thereof in their sole discretion or to release or
substitute any one or more other guarantors or obligors upon or in respect of
the Guaranteed Obligations, all without affecting the obligations of any
Guarantor hereunder.
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(b) To
the fullest extent permitted by applicable law, each Guarantor waives any
defense based on or arising out of any defense of any Borrower or any other Loan
Party or the unenforceability of the Guaranteed Obligations or any part thereof
from any cause, or the cessation from any cause of the liability of any Borrower
or any other Loan Party, other than the indefeasible payment in full in cash of
all the Guaranteed Obligations. The Administrative Agent and the
other Secured Parties may, at their election, foreclose on any security held by
one or more of them by one or more judicial or nonjudicial sales, accept an
assignment of any such security in lieu of foreclosure, compromise or adjust any
part of the Guaranteed Obligations, make any other accommodation with any
Borrower or any other Loan Party or exercise any other right or remedy available
to them against any Borrower or any other Loan Party, without affecting or
impairing in any way the liability of any Guarantor hereunder except to the
extent the applicable Guaranteed Obligations in respect of which such Guarantor
is liable have been fully and indefeasibly paid in full in cash or immediately
available funds or the guarantee of such Guarantor has been terminated and
released pursuant to Section 7.16. To the fullest extent permitted by applicable
law, each Guarantor waives any defense arising out of any such election even
though such election operates, pursuant to applicable law, to impair or to
extinguish any right of reimbursement or subrogation or other right or remedy of
such Guarantor against any Borrower or any other Loan Party, as the case may be,
or any security.
SECTION
2.04. German Guarantee
Limitations. i)Each Secured Party agrees not to enforce
against a German Guarantor any payment obligation arising out of the guarantee
contained in Section 2.01 (the “Payment
Obligation”) (i)
if and to the extent such Payment Obligation secures obligations of an
affiliated company (verbundenes Unternehmen) of
such German Guarantor within the meaning of Section 15 of the German Stock
Corporation Act (Aktiengesetz) (other than any
of the German Guarantor's Subsidiaries) and (ii) if and to the extent the
enforcement of such Payment Obligation would cause the German Guarantor's or, in
the case of a German GmbH & Co. KG Guarantor, its general partner's net
assets (Reinvermögen),
i.e., assets (the calculation of which shall include all items set forth in
Section 266(2) A., B. and C. of the German Commercial Code (Handelsgesetzbuch)) minus
liabilities and liability reserves (the calculation of which shall include all
items set forth in Section 266(3) B., C. and D. of the German Commercial Code
(Handelsgesetzbuch)) to
fall below its stated share capital (Stammkapital) (Begründung einer Unterbilanz)
or, if such net assets are already less than its stated share capital (Stammkapital), would cause
such amount to be further reduced (Vertiefung einer Unterbilanz)
(such event a “Capital
Impairment”) and
such enforcement would result in a violation of Section 30 of the German Act on
Limited Liability Companies (Gesetz betreffend die Gesellschaften
mit beschränkter Haftung – “GmbHG”) provided that
for the purposes of calculating the amount to be enforced (if any) the following
balance sheet items shall be adjusted as follows:
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(i) the
amount of any increase of stated share capital (Stammkapital) of the German
Guarantor or, in the case of a German GmbH & Co. KG Guarantor, its general
partner that has been effected without the prior written consent of the
Administrative Agent shall be deducted from the stated share capital (Stammkapital);
(ii) liabilities
arising from loans provided to the relevant German Guarantor by the Company or
any of its Subsidiaries shall be disregarded if such loans are subordinated
within the meaning of Section 39(2) of the German Insolvency Code (Insolvenzordnung); and
(iii) any
loans and other contractual liabilities incurred by the German Guarantor or, in
the case of a German GmbH & Co. KG Guarantor, its general partner in
violation of the provisions of any of the Loan Documents shall be
disregarded.
(b) Upon
delivery of an Enforcement Notice (as defined below) and upon request of the
Administrative Agent, the German Guarantor shall as soon as reasonably
practicable and in any event within three months after such notice realize any
asset that is shown in the balance sheet with a book value (Buchwert) that is
significantly lower than the market value of such asset, which is not necessary
for the German Guarantor's business (betriebsnotwendig). After the
expiry of such three months period the German Guarantor shall notify the
Administrative Agent of the amount of the proceeds from the sale and submit an
accompanying statement to the Administrative Agent stating the amount of the net
assets (Reinvermögen)
of the German Guarantor or, in the case of a German GmbH & Co. KG Guarantor,
its general partner, and the amount by which such net assets (Reinvermögen) exceed its
respective registered share capital, each recalculated (as of the date of
delivery of an Enforcement Notice) for the purposes of paragraph (a) hereof to
take into account such proceeds.
(c) The
limitations set out in paragraph (a) hereof shall not apply:
(i) in
relation to and to the extent the proceeds of any borrowings under the Credit
Agreement have been on-lent, or otherwise passed on, to such German Guarantor or
any of its Subsidiaries and have not been repaid; and
(ii) to a
German Guarantor which is a party to a domination agreement (Beherrschungsvertrag) as
dominated entity (beherrschtes
Unternehmen) or obliged to transfer its profits pursuant to a profit and
loss transfer agreement (Gewinnabführungsvertrag),
provided that
in such case the Secured Parties shall in any event be entitled to enforce the
Payment Obligation up to the amount enforceable pursuant to paragraph (a) above
but may enforce the Payment Obligation in a higher amount only to the extent
that such enforcement would not result in a personal liability of any officer of
the German Guarantor or, in the case of a German GmbH & Co. KG Guarantor,
its general partner.
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(d) The
limitations set out in paragraph (a) hereof only apply if and to the extent
that:
(i)
within ten (10) Business Days following the notification by any Secured Party of
its intention to enforce the Payment Obligation (the “Enforcement
Notice”), the
managing director(s) on behalf of the relevant German Guarantor or, in the case
of a German GmbH & Co. KG Guarantor, its general partner has/have confirmed
in writing to the Administrative Agent to what extent the Payment Obligation
cannot be enforced as it would cause a Capital Impairment within the meaning of
paragraph (a) above (taking into account the adjustments set out in paragraph
(a)(i) to (iii) above) and such confirmation is supported by evidence reasonably
satisfactory to the Administrative Agent (the “Management
Determination”)
and the Administrative Agent (acting on behalf of the relevant Secured Party)
has not contested this; or
(ii)
within twenty (20) Business Days from the date the Administrative Agent has
contested the Management Determination, the Administrative Agent receives a
determination by the German Guarantor's auditors of the amount that could have
been enforced on the date the Enforcement Notice without causing a Capital
Impairment within the meaning of paragraph (a) above (the “Auditor's
Determination”).
The amount determined in the Auditor's Determination shall (except for manifest
error) be binding for the Loan Parties and the Secured Parties. The costs of the
Auditor's Determination shall be borne by the relevant German
Guarantor.
(e) If
the Administrative Agent disagrees with the Auditor's Determination, the Secured
Parties shall be entitled to enforce the Payment Obligation up to the amount
which is undisputed between themselves and the German Guarantor. In relation to
the amount which is disputed, the Secured Parties shall be entitled to further
pursue their claims (if any) and the German Guarantor shall be entitled to prove
that this amount is necessary for maintaining its or, in the case of a German
GmbH & Co. KG Guarantor, its general partner's stated share capital (Stammkapital) without
violation of Section 30 GmbHG (calculated as of the date that the Enforcement
Notice was given).
(f) If
the Payment Obligation was enforced without limitation because the Management
Determination and/or the Auditor's Determination (as the case may be) was not
delivered within the relevant time or for any other reason, the Secured Parties
shall promptly upon demand by the relevant German Guarantor repay to such German
Guarantor any amount which is necessary pursuant to Section 30 GmbHG to maintain
the stated share capital (Stammkapital) of the German
Guarantor or, in the case of a German GmbH & Co. KG Guarantor, its general
partner, calculated as of the date that the Enforcement Notice was given
provided the relevant Secured Party has received a corresponding amount by the
relevant German Guarantor as a consequence of enforcement of the relevant
Payment Obligation.
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(g) No
reduction of the amount enforceable under this guarantee in accordance with the
above limitations will prejudice the rights of the Secured Parties to continue
enforcing the guarantee (subject always to the operation of the limitation set
out above at the time of such enforcement) until full satisfaction of the
guaranteed claims. For the avoidance of doubt, nothing in this Section 2.04
shall affect the right of the Secured Parties (or any of them) to accelerate the
Loans pursuant to Section 10 of the Credit Agreement or to enforce the security
granted under any Collateral Document.
SECTION
2.05. Reinstatement. Each
of the Guarantors agrees that its guarantee hereunder shall continue to be
effective or be reinstated, as the case may be, if at any time payment, or any
part thereof, of any of its Guaranteed Obligation is rescinded or must otherwise
be restored by the Administrative Agent or any other Secured Party upon the
bankruptcy or reorganization of any Borrower, any other Loan Party or
otherwise.
SECTION
2.06. Agreement to Pay;
Subrogation. In furtherance of the foregoing and not in
limitation of any other right that the Administrative Agent or any other Secured
Party has at law or in equity against any Guarantor by virtue hereof, upon the
failure of any Borrower or any other Loan Party to pay its Guaranteed Obligation
as expressly contemplated by Section 2.01 when and as the same shall become due,
whether at maturity, by acceleration, after notice of prepayment or otherwise,
each Guarantor hereby promises to and will forthwith pay, or cause to be paid,
to the Administrative Agent for distribution to the applicable Secured Parties
in cash the amount of its unpaid Guaranteed Obligation owed. Upon
payment by any Guarantor of any sums to the Administrative Agent as provided
above, all rights of such Guarantor against any Borrower or any other Loan Party
arising as a result thereof by way of right of subrogation, contribution,
reimbursement, indemnity or otherwise shall in all respects be subject to
Article VI.
SECTION
2.07. Information. Each
Guarantor (a) assumes all responsibility for being and keeping itself informed
of each of the Borrower’s and each other Loan Party’s financial condition and
assets, and of all other circumstances bearing upon the risk of nonpayment of
the Guaranteed Obligations and the nature, scope and extent of the risks that
such Guarantor assumes and incurs hereunder, and (b) agrees that none of the
Administrative Agent or the other Secured Parties will have any duty to advise
such Guarantor of information known to it or any of them regarding such
circumstances or risks.
ARTICLE
III
Pledge of Certain
Securities
SECTION
3.01. Pledge. As
security for the payment or performance, as the case may be, in full of its
Secured Obligations, each Grantor hereby assigns and pledges to the
Administrative Agent, its successors and assigns, for the ratable benefit of the
Secured Parties, and hereby grants to the Administrative Agent, its successors
and assigns, for the benefit of the Secured Parties, a security interest in, all
of such Grantor’s right, title and interest in, to and under the
following:
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(a) (i)
the shares of Capital Stock directly owned by such Grantor on the date hereof
(including those listed opposite the name of such Grantor on Schedule II), (ii)
any other Capital Stock obtained in the future by such Grantor and (iii) the
certificates representing all such Capital Stock (collectively, the “Pledged Stock”);
provided that
with respect to any Domestic Secured Obligations, the Pledged Stock shall not
include (A) more than 66% of the issued and outstanding voting Capital Stock of
any Foreign Subsidiary that is a First-Tier Subsidiary, (B) more than 66% of the
issued and outstanding voting Capital Stock of any Qualified CFC Holding Company
that is a First Tier Subsidiary, (C) any issued and outstanding Capital Stock of
any Foreign Subsidiary that is not a First Tier Subsidiary, or (D) any issued
and outstanding Capital Stock of any Qualified CFC Holding Company that is not a
First Tier Subsidiary; provided further, that it is
the intent of this Agreement that not more than 66% of the issued and
outstanding voting Capital Stock of the Additional Borrower directly or
indirectly owned by the Company shall be pledged hereunder with respect to any
Domestic Secured Obligations, and to give effect to such intent, 100% of the
limited partnership interests issued by the Additional Borrower that are owned
by the Company shall be pledged hereunder and none of the voting Capital Stock
of Xxxxxx KG Holding, LLC that is owned by the Company (and, for the avoidance
of doubt, none of the general partner interests issued by the Additional
Borrower) shall be pledged hereunder, in each case to secure Domestic Secured
Obligations, (b)(i) the debt securities and inter-company loans or advances
owned by such Grantor (including those listed opposite the name of such Grantor
on Schedule II), (ii) any debt securities or inter-company loans or advances in
the future held by or owed to such Grantor and (iii) all promissory notes and
any other instruments evidencing any such debt securities or inter-company loans
or advances (collectively, the “Pledged Debt
Securities”); (c) subject to the provisos in clause (a) above, all other
property that may be delivered to and held by the Administrative Agent pursuant
to the terms of this Section 3.01; (d) subject to Section 3.07, all payments of
principal or interest, dividends, cash, instruments and other property from time
to time received, receivable or otherwise distributed in respect of, in exchange
for or upon the conversion of, and all other Proceeds received in respect of,
the securities or instruments referred to in clauses (a) and (b) above; (e)
subject to Section 3.07, all rights and privileges of such Grantor with respect
to the securities, instruments and other property referred to in clauses (a),
(b), (c) and (d) above; and (f) all Proceeds of any and all of the foregoing
(the items referred to in the foregoing clauses (a) through (f) above being
collectively referred to as the “Pledged
Collateral”). Notwithstanding anything
to the contrary, no pledge or security interest is created hereby, and the
Pledged Collateral, Pledged Stock and Pledged Debt Securities shall not include,
any property that would be excluded pursuant to Section 4.01(d) of this
Agreement.
SECTION
3.02. Delivery of the Pledged
Collateral. i)Each Grantor agrees promptly to deliver or cause
to be delivered to the Administrative Agent, for the ratable benefit of the
Secured Parties, any and all Pledged Securities to the extent that such Pledged
Securities are either (i) certificated Capital Stock or (ii) in the case of
promissory notes, required to be delivered pursuant to paragraph (b) of this
Section 3.02.
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(b) (i)
All Indebtedness of the Company and each Subsidiary owing to any Loan Party
shall be evidenced by a promissory note (which may be a global intercompany
note) and (ii) all such Indebtedness described under clause (i), and all
Indebtedness of any other Person (other than any such Indebtedness that,
individually, has a principal amount of less than $5,000,000) owing to any Loan
Party that is evidenced by a promissory note of which a Responsible Officer is
aware shall be pledged and delivered to the Administrative Agent, for the
ratable benefit of the Secured Parties, pursuant to the terms
hereof.
(c) Upon
delivery to the Administrative Agent, (i) any Pledged Securities required to be
delivered pursuant to the foregoing paragraphs (a) and (b) shall be accompanied
by undated stock powers duly executed by the applicable Grantor in blank or
other instruments of transfer satisfactory to the Administrative Agent and by
such other instruments and documents as the Administrative Agent may reasonably
request and (ii) all other property comprising part of the Pledged Collateral
delivered pursuant to the terms of this Agreement shall be accompanied by
undated proper instruments of assignment duly executed by the applicable Grantor
and such other instruments or documents as the Administrative Agent may
reasonably request. Each delivery of Pledged Securities shall be
accompanied by a schedule describing the securities so delivered, which schedule
shall be attached hereto as Schedule II and made a part hereof, provided that failure
to attach any such schedule hereto shall not affect the validity of such pledge
of such Pledged Securities. Each schedule so delivered shall
supplement any prior schedules so delivered.
SECTION
3.03. Representations, Warranties
and Covenants. The Grantors jointly and severally represent,
warrant and covenant to and with the Administrative Agent, for the ratable
benefit of the Secured Parties, that:
(a)
Schedule II sets forth, as of the date hereof, a true and complete list, with
respect to each Grantor, of (i) all the Capital Stock owned by such Grantor and
the percentage of the issued and outstanding units of each class of the Capital
Stock of the issuer thereof represented by the Pledged Stock owned by such
Grantor and (ii) all Pledged Debt Securities required to be delivered to the
Administrative Agent pursuant to Section 3.02;
(b) the
Pledged Stock and Pledged Debt Securities (solely with respect to Pledged Debt
Securities issued by a person that is not a Subsidiary or Affiliate of such
Subsidiary, to the best of each Grantor’s knowledge) have been duly and validly
authorized and issued by the issuers thereof and (i) in the case of Pledged
Stock, are fully paid and nonassessable and (ii) in the case of Pledged Debt
Securities (solely with respect to Pledged Debt Securities issued by a person
that is not a Subsidiary or Affiliate of such Subsidiary, to the best of each
Grantor’s knowledge), are legal, valid and binding obligations of the issuers
thereof, subject to the effects of bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and other similar laws relating to or
affecting creditors’ rights generally, general equitable principles (whether
considered in a proceeding at law or in equity) and an implied covenant of good
faith and fair dealing;
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(c)
except for the security interests granted hereunder, each of the Grantors (i) is
and, subject to any transfers made in compliance with the Credit Agreement, will
continue to be the direct owner, beneficially and of record, of the Pledged
Securities indicated on Schedule II as owned by such Grantor, (ii) holds the
same free and clear of all Liens, other than Liens created by this Agreement,
Liens permitted under subsection 9.3 of the Credit Agreement (“Permitted Liens”),
and transfers made in compliance with the Credit Agreement, (iii) will make no
assignment, pledge, hypothecation or transfer of, or create or permit to exist
any security interest in or other Lien on, the Pledged Collateral, other than
Liens created by this Agreement, Permitted Liens, and transfers made in
compliance with, the Credit Agreement, and (iv) subject to the rights of such
Grantor under the Loan Documents to dispose of Pledged Collateral, will use
commercially reasonable efforts to defend its title or interest thereto or
therein against any and all Liens (other than the Liens created by this
Agreement and Permitted Liens), however arising, of all Persons
whomsoever;
(d)
except for restrictions and limitations imposed by the Loan Documents, the
Xxxxxx LLC Agreement or securities laws generally, the Pledged Stock and, to the
extent issued by the Company or any of its Subsidiaries, the Pledged Debt
Securities are and will continue to be freely transferable and assignable, and
none of the Pledged Stock or, to the extent issued by the Company or any of its
Subsidiaries, the Pledged Debt Securities is or will be subject to any option,
right of first refusal, shareholders agreement, charter or by-law provisions or
contractual restriction of any nature that might prohibit, impair, delay or
otherwise affect the pledge of such Pledged Collateral hereunder, the sale or
disposition thereof pursuant hereto or the exercise by the Administrative Agent
of rights and remedies hereunder;
(e) each
of the Grantors has the power and authority to pledge the Pledged Collateral
pledged by it hereunder in the manner hereby done or contemplated;
(f) no
consent or approval of any Governmental Authority, any securities exchange or,
solely in the case of Pledged Debt Securities issued by any other Person other
than the Company or any of its Subsidiaries was or is necessary to the validity
of the pledge effected hereby (other than such as have been obtained and are in
full force and effect);
(g) by
virtue of the execution and delivery by the Grantors of this Agreement, when any
Pledged Securities are delivered to the Administrative Agent, for the ratable
benefit of the Secured Parties, in accordance with this Agreement, the
Administrative Agent will obtain, for the ratable benefit of the Secured
Parties, a legal, valid and perfected lien upon and security interest in such
Pledged Securities under New York UCC to the extent such lien and security
interest may be created and perfected under the New York UCC, subject only to
Permitted Liens, as security for the payment and performance of the Secured
Obligations; and
16
(h)
subject to applicable local law in the case of any Foreign Guarantor and any
Capital Stock issued by any Foreign Subsidiary, this Agreement is effective to
vest in the Administrative Agent, for the ratable benefit of the Secured
Parties, the rights of the Administrative Agent in the Pledged Collateral as set
forth herein.
SECTION
3.04. Certification of Limited
Liability Company and Limited Partnership Interests. To the
extent any interest in a limited liability company or limited partnership that
is a Domestic Subsidiary and that is controlled by any Grantor is represented by
a certificate and is pledged hereunder, each such interest shall be a “security”
within the meaning of Article 8 of the New York UCC.
SECTION
3.05. Unlimited Liability
Companies. Notwithstanding the grant of security interest made
by the Grantors in favor of the Administrative Agent, its successor and assigns,
for the ratable benefit of the Secured Parties, of all of its Pledged Stock, any
Grantor that controls any interest (for the purposes of this Section 3.05,
“ULC
Interests”) in any unlimited liability company (for the purposes of this
Section 3.05, a “ULC”) pledged
hereunder shall remain registered as the sole registered and beneficial owner of
such ULC Interests and will remain as registered and beneficial owner until such
time as such ULC Interests are effectively transferred into the name of the
Administrative Agent or any other person on the books and records of such
ULC. Nothing in this Agreement is intended to or shall constitute the
Administrative Agent or any person as a shareholder or member of any ULC until
such time as notice is given to such ULC and further steps are taken thereunder
so as to register the Administrative Agent or any other person as the holder of
the ULC Interests of such ULC. To the extent any provision hereof
would have the effect of constituting the Administrative Agent or any other
person as a shareholder or member of a ULC prior to such time, such provision
shall be severed therefrom and ineffective with respect to the ULC Interests of
such ULC without otherwise invalidating or rendering unenforceable this
Agreement or invalidating or rendering unenforceable such provision insofar as
it relates to Pledged Stock which are not ULC Interests. Except upon
the exercise of rights to sell or otherwise dispose of ULC Interests following
the occurrence and during the continuance of an Event of Default hereunder, no
Grantor shall cause or permit, or enable any ULC in which it holds ULC Interests
to cause or permit, the Administrative Agent to: (a) be registered as
shareholders or members of such ULC; (b) have any notation entered in its favor
in the share register of such ULC; (c) be held out as a shareholder or member of
such ULC; (d) receive, directly or indirectly, any dividends, property or other
distributions from such ULC by reason of the Administrative Agent holding a
security interest in such ULC; or (e) act as a shareholder or member of such
ULC, or exercise any rights of a shareholder or member of such ULC including the
right to attend a meeting of, or to vote the shares of, such ULC.
SECTION
3.06. Registration in Nominee
Name; Denominations. The Administrative Agent, on behalf of
the Secured Parties, shall have the right (in its sole and absolute discretion)
to hold the Pledged Securities in the name of the applicable Grantor, endorsed
or assigned in blank or in favor of the Administrative Agent, or, if an Event of
Default shall have occurred and be continuing, in its own name as pledgee or in
the name of its nominees (as pledgee or as sub-agent). Each Grantor
will promptly give to the Administrative Agent copies of any notices or other
communications received by it with respect to Pledged Securities registered in
the name of such Grantor. The Administrative Agent shall at all
reasonable times have the right to exchange the certificates representing
Pledged Securities for certificates of smaller or larger denominations for any
reasonable purpose consistent with this Agreement. Each Grantor shall
use its commercially reasonable efforts to cause any Loan Party that is not a
party to this Agreement to comply with a request by the Administrative Agent,
pursuant to this Section 3.06, to exchange certificates representing Pledged
Securities of such Loan Party for certificates of smaller or larger
denominations.
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SECTION
3.07. Voting Rights; Dividends and
Interest. i)Unless and until an Event of Default shall have
occurred and be continuing and the Administrative Agent shall have notified the
Grantors that their rights under this Section 3.07 are being
suspended:
(i) each
Grantor shall be entitled to exercise any and all voting and/or other consensual
rights and powers inuring to an owner of Pledged Collateral or any part thereof
for any purpose consistent with the terms of this Agreement, the Credit
Agreement and the other Loan Documents, provided that such
rights and powers shall not be exercised in any manner that could reasonably be
expected to materially and adversely affect the rights inuring to a holder of
any Pledged Collateral or the rights and remedies of the Administrative Agent or
any other of the Secured Parties under this Agreement or the Credit Agreement or
any other Loan Document or the ability of the Secured Parties to exercise the
same;
(ii) the
Administrative Agent shall execute and deliver to each Grantor, or cause to be
executed and delivered to such Grantor, all such proxies, powers of attorney and
other instruments as such Grantor may reasonably request for the purpose of
enabling such Grantor to exercise the voting and/or consensual rights and powers
it is entitled to exercise pursuant to subparagraph (i) above; and
(iii)
each Grantor shall be entitled to receive and retain any and all dividends,
interest, principal and other distributions paid on or distributed in respect of
the Pledged Collateral to the extent and only to the extent that such dividends,
interest, principal and other distributions are permitted by, and otherwise paid
or distributed in accordance with, the terms and conditions of the Credit
Agreement, the other Loan Documents and applicable laws, provided that any
noncash dividends, interest, principal or other distributions that would
constitute Pledged Stock or Pledged Debt Securities, whether resulting from a
subdivision, combination or reclassification of the outstanding Capital Stock of
the issuer of any Pledged Securities or received in exchange for Pledged
Securities or any part thereof, or in redemption thereof, or as a result of any
merger, amalgamation, consolidation, acquisition or other exchange of assets to
which such issuer may be a party or otherwise, shall be and become part of the
Pledged Collateral and, if received by any Grantor, shall not be commingled by
such Grantor with any of its other funds or property but shall be held separate
and apart therefrom, shall be held in trust for the benefit of the
Administrative Agent and shall be forthwith delivered to the Administrative
Agent in the same form as so received (with any necessary
endorsement).
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(b) Upon
the occurrence and during the continuance of an Event of Default, after the
Administrative Agent shall have notified the Grantors of the suspension of their
rights under paragraph (a)(iii) of this Section 3.07, all rights of any Grantor
to dividends, interest, principal or other distributions that such Grantor is
authorized to receive pursuant to paragraph (a)(iii) of this Section 3.07 shall
cease, and all such rights shall thereupon become vested in the Administrative
Agent, which shall have the sole and exclusive right and authority to receive
and retain such dividends, interest, principal or other
distributions. All dividends, interest, principal or other
distributions received by any Grantor contrary to the provisions of this Section
3.07 shall be held in trust for the benefit of the Administrative Agent, shall
be segregated from other property or funds of such Grantor and shall be
forthwith delivered to the Administrative Agent upon demand in the form in which
so received (with any necessary endorsement). Any and all money and
other property paid over to or received by the Administrative Agent pursuant to
the provisions of this paragraph (b) shall be retained by the Administrative
Agent in an account to be established by the Administrative Agent upon receipt
of such money or other property and shall be applied in accordance with the
provisions of Section 5.02. After all Events of Default have been
cured or waived and the Company has delivered to the Administrative Agent a
certificate to that effect, the Administrative Agent shall promptly repay to
each Grantor (without interest) all dividends, interest, principal or other
distributions that such Grantor would otherwise be permitted to retain pursuant
to the terms of paragraph (a)(iii) of this Section 3.07 and that remain in such
account.
(c) Upon
the occurrence and during the continuance of an Event of Default, after the
Administrative Agent shall have notified the Grantors of the suspension of their
rights under paragraph (a)(i) of this Section 3.07, all rights of any Grantor to
exercise the voting and consensual rights and powers it is entitled to exercise
pursuant to paragraph (a)(i) of this Section 3.07, and the obligations of the
Administrative Agent under paragraph (a)(ii) of this Section 3.07, shall cease,
and all such rights shall thereupon become vested in the Administrative Agent,
which shall have the sole and exclusive right and authority to exercise such
voting and consensual rights and powers, provided that, unless
otherwise directed by the Majority Extended Tranche Lenders, the Administrative
Agent shall have the right from time to time following and during the
continuance of an Event of Default to permit the Grantors to exercise such
rights.
(d) Any
notice given by the Administrative Agent to the Grantors suspending their rights
under paragraph (a) of this Section 3.07 (i) may be given by telephone if
promptly confirmed in writing, (ii) may be given to one or more of the Grantors
at the same or different times and (iii) may suspend the rights of the Grantors
under paragraph (a)(i) or paragraph (a)(iii) in part without suspending all such
rights (as specified by the Administrative Agent in its sole and absolute
discretion) and without waiving or otherwise affecting the Administrative
Agent’s right to give additional notices from time to time suspending other
rights so long as an Event of Default has occurred and is
continuing.
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(e) After
all Events of Default have been cured or waived and the Company has delivered to
the Administrative Agent a certificate to that effect, each Grantor shall have
the right to exercise the voting and/or consensual rights and powers that such
Grantor would otherwise be entitled to exercise pursuant to the terms of
paragraph (a)(i) above and the obligations of the Administrative Agent under
paragraph (a)(ii) shall be in effect.
ARTICLE
IV
Security Interests in
Personal Property
SECTION
4.01. Security
Interest. i)As security for the payment or performance, as the
case may be, in full of its Secured Obligations, each Grantor hereby grants to
the Administrative Agent, its successors and assigns, for the ratable benefit of
the Secured Parties, a security interest (the “Security Interest”)
in all right, title and interest in and to any and all personal property and
other assets and properties now owned or at any time hereafter acquired by such
Grantor or in which such Grantor now has or at any time in the future may
acquire any right, title or interest (collectively, the “Article 9
Collateral”), which Article 9 Collateral includes but is not limited
to:
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(i)
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all
Accounts;
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(ii)
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all
Chattel Paper;
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(iii)
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all
cash, Cash Collateral Accounts and Deposit
Accounts;
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(iv)
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all
Documents;
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(v)
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all
Equipment;
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(vi)
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all
General Intangibles (including all Intellectual
Property);
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(vii)
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all
Instruments;
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(viii)
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all
Inventory;
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(ix)
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all
Investment Property;
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(x)
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all
Letter-of-Credit rights;
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(xi)
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all
Commercial Tort Claims described on Schedule
IV;
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(xii)
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all
books and records pertaining to the Article 9 Collateral;
and
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(xiii)
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to
the extent not otherwise included, all Proceeds and products of any and
all of the foregoing and all collateral security and guarantees given by
any Person with respect to any of the
foregoing;
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20
(b) Each
Grantor hereby irrevocably authorizes the Administrative Agent at any time and
from time to time to file in any relevant jurisdiction any initial financing
statements (including fixture filings) and financing change statements with
respect to the Article 9 Collateral or any part thereof and amendments thereto
that (i) identify the applicable Collateral (including, in the case of any
Grantor, by indicating the Collateral to be “all assets” of such Grantor or
words of similar effect as being of an equal or lesser scope or with greater
detail) and (ii) contain the information required by Article 9 of the Uniform
Commercial Code or other applicable law of each applicable jurisdiction for the
filing of any financing statement, financing change statement or amendment,
including (A) whether such Grantor is an organization, the type of organization
and any organizational identification number issued to such Grantor and (B) in
the case of a financing statement filed as a fixture filing or covering Article
9 Collateral constituting minerals or the like to be extracted or timber to be
cut, a sufficient description of the real property to which such Article 9
Collateral relates. Each Grantor agrees to provide such information
to the Administrative Agent promptly upon request.
Each
Grantor also ratifies its authorization for the Administrative Agent to file in
any relevant jurisdiction any initial financing statements and financing change
statements or amendments thereto if filed prior to the date hereof.
The
Administrative Agent is further authorized to file with the United States Patent
and Trademark Office or United States Copyright Office (or any successor office
or any similar office in any other country) such documents as may be reasonably
necessary or advisable for the purpose of perfecting, confirming, continuing,
enforcing or protecting the Security Interest granted by each Grantor, without
the signature of any Grantor, and naming any Grantor or the Grantors as debtors
and the Administrative Agent as secured party.
(c) The
Security Interest and the security interest granted pursuant to Article III are
granted as security only and shall not subject the Administrative Agent or any
other Secured Party to, or in any way alter or modify, any obligation or
liability of any Grantor with respect to or arising out of the
Collateral.
(d) Notwithstanding
anything herein to the contrary, this Agreement shall not constitute a grant of
a security interest in and the “Article 9 Collateral” and the “Pledged
Collateral” shall not include, (i) any assets (including Capital Stock)
hereafter acquired with respect to which the Collateral and Guarantee
Requirement would not be required to be satisfied by reason of the definition of
“Collateral and Guarantee Requirement” in the Credit Agreement, (ii) any
property excluded from the definition of Pledged Collateral pursuant to Section
3.01, (iii) any Letter of Credit rights to the extent any Grantor is required by
applicable law to apply the proceeds of a drawing of such Letter of Credit for a
specified purpose, (iv) any Grantor’s right, title or interest in any license,
contract or agreement to which such Grantor is a party or any of its right,
title or interest thereunder to the extent, but only to the extent, that such a
grant would, under the terms of such license, contract or agreement, result in a
breach of the terms of, or constitute a default under, or result in the
abandonment, invalidation or unenforceability of, any license, contract or
agreement to which such Grantor is a party (other than to the extent that any
such term would be rendered ineffective pursuant to Sections 9-406, 9-407, 9-408
or 9-409 of the New York UCC or any other applicable law (including, without
limitation, Title 11 of the United States Code) or principles of equity); provided, that
immediately upon the ineffectiveness, lapse or termination of any such
provision, the Collateral shall include, and such Grantor shall be deemed to
have granted a security interest in, all such rights and interests as if such
provision had never been in effect, (v) any Equipment owned by any Grantor that
is subject to a purchase money lien or a Capital Lease Obligation if the
contract or other agreement in which such Lien is granted (or the documentation
providing for such Capital Lease Obligation) prohibits or requires the consent
of any person other than the Grantors as a condition to the creation of any
other security interest on such Equipment, (vi) to
the extent applicable law requires that a subsidiary of such Grantor issue
directors’ qualifying shares, such shares or nominee or similar shares, (vii)
any right, title or interest of any Grantor in respect of the Harman Trust Agreement, (viii) any of the
Capital Stock issued by the Additional Borrower owned by Xxxxxx KG Holding, LLC
or (ix) any assets (including Capital Stock) to the extent that such grant of a
security interest is prohibited by any applicable law, treaty, rule or
regulation.
21
(e) The
Article 9 Collateral shall not include the last day of the term of any lease or
agreement therefor but upon the enforcement of the Security Interest granted
hereby in the Article 9 Collateral, the Grantors or any of them shall stand
possessed of such last day in trust to assign the same to any person acquiring
such term.
(f) Notwithstanding
Section 4.01(a), the Article 9 Collateral shall not include “consumer goods” of
any Grantor organized under the laws of Canada or any Province thereof as that
term is defined in the PPSA.
(g) Notwithstanding
Section 4.01(a), the grant by any Grantor organized under the laws of Canada or
any Province thereof of security in Trade-marks (as defined in the Trade-marks
Act (Canada)) under this Agreement shall be limited to a grant by such Grantor
of a security interest in all of such Grantor’s right, title and interest in
such Trade-marks.
(h) Each
Grantor and the Administrative Agent hereby acknowledge that (a) value has been
given in respect of the security interests granted herein; (b) such Grantor has
rights in the Collateral in which it has granted a security interest; and (c)
this Agreement constitutes a security agreement as that term is defined in the
PPSA.
(i) If
the Collateral is realized upon and the security interest in the Collateral is
not sufficient to satisfy all the Secured Obligations, each Grantor acknowledges
and agrees that, subject to the provisions of the PPSA, such Grantor shall
continue to be liable for its Secured Obligations remaining outstanding and the
Administrative Agent shall be entitled to pursue full payment
thereof.
SECTION
4.02. Representations and
Warranties. The Grantors jointly and severally represent and
warrant to the Administrative Agent, for the ratable benefit of the Secured
Parties, that:
22
(a) Each
Grantor has good and valid rights in and title to the Article 9 Collateral with
respect to which it has purported to grant a Security Interest hereunder and has
full power and authority to grant to the Administrative Agent the Security
Interest in such Article 9 Collateral pursuant hereto and to execute, deliver
and perform its obligations in accordance with the terms of this Agreement,
without the consent or approval of any other Person other than any consent or
approval that has been obtained.
(b) (i)
The Perfection Certificate has been duly prepared, completed and executed and
the information set forth therein, including, without limitation, the legal name
of each Loan Party, is correct and complete in all material respects as of the
Restatement Effective Date, (ii) the Uniform Commercial Code financing
statements (including fixture filings, as applicable) or other appropriate
filings, recordings or registrations prepared by the Administrative Agent based
upon the information provided to the Administrative Agent in the Perfection
Certificate for filing in each governmental, municipal or other office specified
in Schedule 2 to the Perfection Certificate (or specified by notice from the
Company to the Administrative Agent after the Restatement Effective Date in the
case of filings, recordings or registrations required by subsection 8.11 of the
Credit Agreement), are all the filings, recordings and registrations (other than
filings required to be made in the United States Patent and Trademark Office,
the United States Copyright Office and the
Canadian Intellectual Property Office in order to perfect the Security
Interest in Article 9 Collateral consisting of Intellectual Property) that are
necessary to publish notice of and protect the validity of and to establish a
legal, valid and perfected security interest in favor of the Administrative
Agent (for the ratable benefit of the Secured Parties) in respect of all Article
9 Collateral in which the Security Interest may be perfected by filing,
recording or registration in the United States, Canada (or any political
subdivision thereof) and their provinces, territories and possessions, and no
further or subsequent filing, refiling, recording, rerecording, registration or
reregistration is necessary in any such jurisdiction, except as provided under
applicable law with respect to the filing of renewals or continuation
statements; (iii) each Grantor shall ensure that a Patent and Trademark Security
Agreement, in substantially the form of Exhibit III hereto, and a Copyright
Security Agreement in substantially the form of Exhibit IV hereto (such
agreements being collectively referred to as the “IP Security
Agreements”), in each case containing a description of the Article 9
Collateral consisting of the material pending and issued United States
registered Patents, pending and registered United States Trademarks and pending
and registered United States Copyrights, as applicable, and executed by each
Grantor owning any such Article 9 Collateral, shall be delivered to the
Administrative Agent, for registration thereof with the United States Patent and
Trademark Office or the United States Copyright Office pursuant to 35 U.S.C. §
261, 15 U.S.C. § 1060 or 17 U.S.C. § 205 and the regulations thereunder, as
applicable to protect the validity of and to establish a legal, valid and
perfected security interest in favor of the Administrative Agent (for the
ratable benefit of the Secured Parties) in respect of all Article 9 Collateral
consisting of such material Intellectual Property in which a security interest
may be perfected by filing, recording or registration in the United States,
Canada (or any political subdivision thereof) and their provinces, territories
and possessions, and no further or subsequent filing, refiling, recording,
rerecording, registration or reregistration is necessary (other than such
actions as are necessary to perfect the Security Interest with respect to any
Article 9 Collateral consisting of Intellectual Property (or registration or
application for registration thereof) acquired or developed after the date
hereof).
23
(c) The
Security Interest constitutes (i) a legal and valid security interest in all the
Article 9 Collateral securing the payment and performance of the Secured
Obligations, (ii) subject to the filings described in Section 4.02(b), a
perfected security interest in all Article 9 Collateral in which a security
interest may be perfected by filing, recording or registering a financing
statement or analogous document in the United States or Canada (or any political
subdivision thereof) and their provinces, territories and possessions pursuant
to the Uniform Commercial Code or the
PPSA and (iii) a security
interest that shall be perfected in all Article 9 Collateral in which a security
interest may be perfected upon the receipt and recording of the IP Security
Agreement with the United States Patent and Trademark Office and the United
States Copyright Office, as applicable, within the three-month period
(commencing as of the date hereof) pursuant to 35 U.S.C. § 261 or 15 U.S.C. §
1060 or the one month period (commencing as of the date hereof) pursuant to 17
U.S.C. § 205. The Security Interest is and shall be prior to any
other Lien on any of the Article 9 Collateral, other than Permitted
Liens.
(d) The
Article 9 Collateral is owned by the Grantors free and clear of any Lien, except
for Permitted Liens. None of the Grantors has filed or consented to the filing
of (i) any financing statement, financing change statement or analogous document
under the Uniform Commercial Code, the PPSA or any other applicable laws
covering any Article 9 Collateral, (ii) any assignment in which any Grantor
assigns any Collateral or any security agreement or similar instrument covering
any Article 9 Collateral with the United States Patent and Trademark Office or
the United States Copyright Office or (iii) any assignment in which any Grantor
assigns any Article 9 Collateral or any security agreement or similar instrument
covering any Article 9 Collateral with any foreign governmental, municipal or
other office, which financing statement, financing
change statement or analogous document, assignment, security agreement or
similar instrument is still in effect, except, in each case, for Permitted
Liens.
(e) Schedule
III hereto sets forth, to the best of each Grantor’s knowledge, as of
the date hereof, (i) all of each Grantor’s material pending and issued United
States Patents, including the name of the registered owner, type, registration
or application serial number, issue number and expiration date (if already
registered) of each such Patent application and issued Patent application owned
by any Grantor, (ii) all of each Grantor’s material pending and registered
United States Trademarks, including the name of the registered owner and the
registration or application serial number of each such Trademark application and
registered Trademark owned by any Grantor, and (iii) all of each Grantor’s
material pending and registered United States Copyrights, if any, including the
name of the registered owner, title and, if applicable, the registration number
of each such registered Copyright owned by any Grantor.
(f) Schedule
IV hereto sets forth, as of the date hereof, each Commercial Tort Claim in
respect of which a complaint or a counterclaim has been filed by any Grantor
seeking damages in an amount of $5,000,000 or more.
24
SECTION
4.03. Covenants. i)Each
Grantor agrees to promptly provide the Administrative Agent with certified
organizational documents reflecting any of the changes described in subsection
8.10 of the Credit Agreement. Each Grantor agrees promptly to notify
the Administrative Agent if any material portion of the Article 9 Collateral
owned or held by such Grantor is damaged, destroyed, or subject to
condemnation.
(b) Each
year, at the time of delivery of annual financial statements with respect to the
preceding fiscal year pursuant to subsection 8.1(a) of the Credit Agreement, the
Company shall deliver to the Administrative Agent a certificate executed by a
Responsible Officer and the chief legal officer of the Company (i) setting forth
the information required pursuant to the Perfection Certificate with respect to
all Collateral owned as of such date or confirming that there has been no change
in such information since the date of such certificate or the date of the most
recent certificate delivered pursuant to this Section 4.03(b) and (ii)
certifying based on the Collateral owned and the applicable law in effect as of
the date of such certificate that all Uniform Commercial Code and PPSA financing
statements and financing change statements (including fixture filings, as
applicable) or other appropriate filings recordings or registrations, including
all refilings, rerecordings and registrations, containing a description of the
Collateral have been filed of record in each governmental, municipal or other
appropriate office in each jurisdiction identified in the Perfection Certificate
to the extent necessary to protect and perfect the Security Interest for a
period of not less than 18 months after the date of such certificate (except as
noted therein with respect to any continuation statements to be filed within
such period).
(c) Subject
to the rights of such Grantor under the Loan Documents to dispose of Collateral,
each Grantor shall, at its own expense, use commercially reasonable efforts to
defend title to the Article 9 Collateral against all Persons and to defend the
Security Interest of the Administrative Agent, for the ratable benefit of the
Secured Parties, in the Article 9 Collateral and the priority thereof against
any Lien that is not a Permitted Lien.
(d) Each
Grantor agrees, at its own expense, to execute, acknowledge, deliver and cause
to be duly filed all such further instruments and documents and take all such
actions as the Administrative Agent may from time to time reasonably request to
better assure, preserve, protect and perfect the Security Interest and the
rights and remedies created hereby, including the payment of any fees and taxes
required in connection with the execution and delivery of this Agreement, the
granting of the Security Interest and the filing of any financing statements
or financing change statements (including
fixture filings) or other documents in connection herewith or
therewith.
Without
limiting the generality of the foregoing, each Grantor hereby authorizes the
Administrative Agent, with prompt notice thereof to the Grantors, to supplement
this Agreement by supplementing Schedule III or adding additional schedules
hereto to identify specifically any asset or item that may constitute material
Intellectual Property, provided that any
Grantor shall have the right, exercisable within 30 days after the Company has
been notified by the Administrative Agent of the specific identification of such
Collateral, to advise the Administrative Agent in writing of any inaccuracy of
the representations and warranties made by such Grantor hereunder with respect
to such Collateral. Each Grantor agrees that it will use its
commercially reasonable efforts to take such action as shall be necessary in
order that all representations and warranties hereunder shall be true and
correct with respect to such Collateral within 30 days after the date it has
been notified by the Administrative Agent of the specific identification of such
Collateral.
25
(e) At
its option, the Administrative Agent may discharge past due taxes, assessments,
charges, fees, Liens, security interests or other encumbrances at any time
levied or placed on the Article 9 Collateral and not a Permitted Lien, and may
pay for the maintenance and preservation of the Article 9 Collateral to the
extent any Grantor fails to do so as required by the Credit Agreement or this
Agreement, and each Grantor jointly and severally agrees to reimburse the
Administrative Agent on demand for any reasonable payment made or any reasonable
expense incurred by the Administrative Agent pursuant to the foregoing
authorization, provided that nothing
in this paragraph shall be interpreted as excusing any Grantor from the
performance of, or imposing any obligation on the Administrative Agent or any
Secured Party to cure or perform, any covenants or other promises of any Grantor
with respect to taxes, assessments, charges, fees, Liens, security interests or
other encumbrances and maintenance of properties as set forth herein or in the
other Loan Documents.
(f) Each
Grantor shall remain liable to observe and perform all the conditions and
obligations to be observed and performed by it under each contract, agreement or
instrument relating to the Article 9 Collateral, and each Grantor jointly and
severally agrees to indemnify and hold harmless the Administrative Agent and the
Secured Parties from and against any and all liability for such
performance.
(g) None
of the Grantors shall make or permit to be made an assignment, pledge or
hypothecation of the Article 9 Collateral or shall grant any other Lien in
respect of the Article 9 Collateral, except as permitted by the Credit
Agreement. None of the Grantors shall make or permit to be made any
transfer of the Article 9 Collateral and each Grantor shall remain at all times
in possession of the Article 9 Collateral owned by it, except as permitted by
the Credit Agreement.
(h) None
of the Grantors will, without the Administrative Agent’s prior written consent,
grant any extension of the time of payment of any Accounts included in the
Article 9 Collateral, compromise, compound or settle the same for less than the
full amount thereof, release, wholly or partly, any Person liable for the
payment thereof or allow any credit or discount whatsoever thereon, other than
extensions, compromises, settlements, releases, credits or discounts granted or
made in the ordinary course of business.
(i) The
Grantors, at their own expense, shall maintain or cause to be maintained
insurance covering physical loss or damage to the Inventory and Equipment in
accordance with the requirements set forth in subsection 8.5 of the Credit
Agreement. Each Grantor irrevocably makes, constitutes and appoints
the Administrative Agent (and all officers, employees or agents designated by
the Administrative Agent) as such Grantor’s true and lawful agent (and
attorney-in-fact) for the purpose, during the continuance of an Event of
Default, of making, settling and adjusting claims in respect of Article 9
Collateral under policies of insurance, endorsing the name of such Grantor on
any check, draft, instrument or other item of payment for the proceeds of such
policies of insurance and for making all determinations and decisions with
respect thereto. In the event that any Grantor at any time or times
shall fail to obtain or maintain any of the policies of insurance required
hereby or to pay any premium in whole or part relating thereto, the
Administrative Agent may, without waiving or releasing any obligation or
liability of the Grantors hereunder or any Event of Default, in its sole
discretion, obtain and maintain such policies of insurance and pay such premium
and take any other actions with respect thereto as the Administrative Agent
deems advisable. All sums disbursed by the Administrative Agent in
connection with this paragraph, including reasonable attorneys’ fees, court
costs, expenses and other charges relating thereto, shall be payable, upon
demand, by the Grantors to the Administrative Agent and shall be additional
Secured Obligations secured hereby.
26
(j) Each
Grantor shall maintain, in form and manner reasonably satisfactory to the
Administrative Agent, records of its Chattel Paper, if any, and its books,
records and documents evidencing or pertaining thereto.
(k) The
Company shall use commercially reasonable efforts to obtain an estoppel letter,
in a form reasonably satisfactory to the Administrative Agent, from the secured
parties under those certain PPSA registrations of QNX Software Systems Co.
confirming that such PPSA registrations relate only to the interests in a
specific escrow account and any and all proceeds thereof.
(l) Xxxxxx
KG Holding, LLC shall not (i) engage in any business or activity other than
ownership of the interests in the Additional Borrower owned by it as of the
Restatement Effective Date, (ii) own any assets other than its interests in the
Additional Borrower owned as of the Restatement Effective Date, (iii) create,
incur, assume or suffer to exist any Indebtedness or any Liens on any of its
assets whether now or hereafter acquired or (iv) create, incur, assume or suffer
to exist any liabilities (other than liabilities imposed by law, including tax
liability or liabilities relating to its existence).
SECTION
4.04. Other
Actions. In order to further ensure the attachment, perfection
and priority of, and the ability of the Administrative Agent to enforce, for the
ratable benefit of the Secured Parties, the Security Interest, each Grantor
agrees, in each case at such Grantor’s own expense, to take the following
actions with respect to the following Article 9 Collateral:
(a) Instruments and Tangible
Chattel Paper. If any Grantor shall at any time hold or
acquire any Instruments (other than any instrument received and processed in the
ordinary course of business) or Tangible Chattel Paper evidencing an amount in
excess of $5,000,000, such Grantor shall forthwith endorse, assign and deliver
the same to the Administrative Agent, accompanied by such instruments of
transfer or assignment duly executed in blank as the Administrative Agent may
from time to time reasonably request.
27
(b) Deposit
Accounts. For each Deposit Account that any Grantor at any
time opens or maintains, such Grantor shall either (i) cause the depositary bank
to agree to comply with instructions from the Administrative Agent to such
depositary bank directing the disposition of funds from time to time credited to
such deposit account, without further consent of such Grantor or any other
Person, pursuant to an agreement reasonably satisfactory to the Administrative
Agent, or (ii) arrange for the Administrative Agent to become the customer of
the depositary bank with respect to such Deposit Account, with the Grantor being
permitted, only with the consent of the Administrative Agent, to exercise rights
to withdraw funds from such deposit account. The Administrative Agent
agrees with each Grantor that the Administrative Agent shall not give any such
instructions or withhold any withdrawal rights from any Grantor unless an Event
of Default has occurred and is continuing or, after giving effect to any
withdrawal, would occur. The provisions of this
paragraph shall not apply to (A) any Deposit Account for which any Grantor, the
depositary bank and the Administrative Agent have entered into a cash collateral
agreement specially negotiated among such Grantor, the depositary bank and the
Administrative Agent for the specific purpose set forth therein and (B) Deposit
Accounts for which the Administrative Agent is the depositary.
(c) Investment
Property. Except to the extent otherwise provided in Article
III, if any Grantor shall at any time hold or acquire any certificated
securities subject to the Security Interest, such Grantor shall forthwith
endorse, assign and deliver the same to the Administrative Agent, accompanied by
such instruments of transfer or assignment duly executed in blank as the
Administrative Agent may from time to time reasonably specify. If any
securities now or hereafter acquired by any Grantor and subject to the Security
Interest are uncertificated and are issued to such Grantor or its nominee
directly by the issuer thereof, such Grantor shall promptly notify the
Administrative Agent thereof and, at the Administrative Agent’s reasonable
request and option, pursuant to an agreement in form and substance reasonably
satisfactory to the Administrative Agent, either (i) cause the issuer to agree
to comply with instructions from the Administrative Agent as to such securities,
without further consent of any Grantor or such nominee, or (ii) arrange for the
Administrative Agent to become the registered owner of the
securities. If any securities, whether certificated or
uncertificated, or other investment property now or hereafter acquired by any
Grantor and subject to the Security Interest are held by such Grantor or its
nominee through a securities intermediary or commodity intermediary, such
Grantor shall immediately notify the Administrative Agent thereof and, at the
Administrative Agent’s request and option, pursuant to an agreement in form and
substance reasonably satisfactory to the Administrative Agent, either (i) cause
such securities intermediary or commodity intermediary, as the case may be, to
agree to comply with entitlement orders or other instructions from the
Administrative Agent to such securities intermediary as to such security
entitlements or to apply any value distributed on account of any commodity
contract as directed by the Administrative Agent to such commodity intermediary,
as the case may be, in each case without further consent of any Grantor, such
nominee, or any other Person, or (ii) in the case of Financial Assets or other
Investment Property held through a securities intermediary, arrange for the
Administrative Agent to become the entitlement holder with respect to such
Investment Property, with the Grantor being permitted, only with the consent of
the Administrative Agent, to exercise rights to withdraw or otherwise deal with
such Investment Property. The Administrative Agent agrees with each
of the Grantors that the Administrative Agent shall not give any such
entitlement orders or instructions or directions to any such issuer, securities
intermediary or commodity intermediary, and shall not withhold its consent to
the exercise of any withdrawal or dealing rights by any Grantor, unless an Event
of Default has occurred and is continuing, or, after giving effect to any such
investment and withdrawal rights, would occur. The provisions of this
paragraph shall not apply to any Financial Assets credited to a securities
account for which the Administrative Agent is the securities
intermediary.
28
(d) Commercial Tort
Claims. If any Grantor shall at any time hold or acquire a
Commercial Tort Claim in an amount reasonably estimated to exceed $5,000,000,
the Grantor shall promptly notify the Administrative Agent thereof in a writing
signed by such Grantor, including a summary description of such claim, and grant
to the Administrative Agent in such writing a security interest therein and in
the proceeds thereof, all upon the terms of this Agreement, with such writing to
be in form and substance reasonably satisfactory to the Administrative
Agent.
SECTION
4.05. Covenants Regarding
Intellectual Property Collateral. i)Each Grantor agrees that
it will not do any act or omit to do any act (and will exercise commercially
reasonable efforts to prevent its licensees from doing any act omitting to do
any act) whereby any Patent may become invalidated or dedicated to the public,
and agrees that it shall use commercially reasonable efforts to continue to xxxx
any products covered by a Patent that is material to the conduct of such
Grantor’s business with the relevant patent number as necessary and sufficient
to establish and preserve its maximum rights under applicable patent
laws.
(b) Each
Grantor will, and will use its commercially reasonable efforts to cause its
licensees or its sublicensees to, for each Trademark material to the conduct of
such Grantor’s business, (i) maintain such Trademark in full force free from any
claim of abandonment or invalidity for non-use, (ii) maintain the quality of
products and services offered under such Trademark, (iii) display such Trademark
with notice of Federal or foreign registration to the extent necessary and
sufficient to establish and preserve its maximum rights as required under
applicable law and (iv) not knowingly use or knowingly permit the use of such
Trademark in violation of any third party rights.
29
(c) Each
Grantor will, and will use its commercially reasonable efforts to cause its
licensees or its sublicensees to, for each work covered by a Copyright material
to the conduct of such Grantor’s business that it publishes, displays and
distributes, use copyright notice as required under applicable copyright
laws.
(d) Each
Grantor shall notify the Administrative Agent promptly if it knows or has reason
to know that any Patent, Trademark or Copyright material to the conduct of such
Grantor’s business may imminently become abandoned, lapsed or dedicated to the
public, or of any materially adverse determination or development (including the
institution of, or any such determination or development in, any proceeding in
the United States Patent and Trademark Office, United States Copyright Office or
any court or similar office of any country) regarding such Grantor’s ownership
of any Intellectual Property material to the conduct of its business, its right
to register the same, or its right to keep and maintain the same.
(e) Each
Grantor, either itself or through any agent, employee, licensee or designee,
shall (i) inform the Administrative Agent on an annual basis of each application
by itself, or through any agent, employee, licensee or designee, for any Patent
with the United States Patent and Trademark Office, United States Copyright
Office or any office or agency in any political subdivision of the United States
or in any other country or any political subdivision thereof during the
preceding twelve-month period, in each case to the extent such application or
registration relates to Intellectual Property material to the normal course of
such Grantor’s business and (ii) execute and deliver any and all agreements,
instruments, documents and papers as the Administrative Agent may otherwise
reasonably request to evidence the Administrative Agent’s security interest in
such Intellectual Property and each Grantor hereby appoints the Administrative
Agent as its attorney in fact to execute and file such writing for the foregoing
purposes, all acts of such attorney being hereby ratified and confirmed; such
power being coupled with an interest is irrevocable.
(f) Each
Grantor shall exercise its reasonable business judgment with the practice in any
proceeding before the United States Patent and Trademark Office, United States
Copyright Office or any office or agency in any political subdivision of the
United States or in any other country or any political subdivision thereof, to
maintain and pursue each material application relating to the Intellectual
Property (and to obtain the relevant grant or registration) and to maintain each
issued Patent and each registration of the Trademarks and Copyrights that is
material to the conduct of any Grantor’s business, including timely filings of
applications for renewal, affidavits of use, affidavits of incontestability and
payment of maintenance fees, and, if consistent with good business judgment, to
initiate opposition, interference and cancelation proceedings against third
parties.
(g) In
the event that any Grantor knows or has reason to believe that any Article 9
Collateral consisting of Patent, Trademark or Copyright material to the conduct
of any Grantor’s business has been or is about to be materially infringed,
misappropriated or diluted by a third party, such Grantor promptly shall notify
the Administrative Agent and shall, if the Grantor deems it necessary in its
reasonable business judgment, promptly xxx and recover any and all damages and
take such other actions as are reasonably appropriate under the
circumstances.
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(h) Upon
and during the continuance of an Event of Default, each Grantor shall use its
commercially reasonable efforts to obtain all requisite consents or approvals by
the licensor of each Copyright License, Patent License or Trademark License
under which such Grantor is a licensee to effect the assignment of all such
Grantor’s right, title and interest thereunder to the Administrative Agent or
its designee.
SECTION
4.06. Cash
Collateral Accounts. The Grantors shall establish and maintain
the Cash Collateral Account as and when required by the provisions of the Credit
Agreement and any funds on deposit in the Cash Collateral Account shall continue
to be collateral security for all of the Secured Obligations. Upon
the occurrence and during the continuance of an Event of Default, at the
Administrative Agent’s election, any funds on deposit in any Cash Collateral
Account may be applied as provided in Section 5.02.
ARTICLE
V
Remedies
SECTION
5.01. Remedies Upon
Default. Upon the occurrence and during the continuance of an
Event of Default, each Grantor agrees to deliver each item of Collateral to the
Administrative Agent on demand, and it is agreed that the Administrative Agent
shall have the right to take any of or all the following actions at the same or
different times: (a) to the extent permitted under applicable law,
with respect to any Article 9 Collateral consisting of Intellectual Property, on
demand, to cause the Security Interest to become an assignment, transfer and
conveyance of any of or all such Article 9 Collateral by the applicable Grantors
to the Administrative Agent, or to license or sublicense, whether general,
special or otherwise, and whether on an exclusive or nonexclusive basis, any
such Article 9 Collateral throughout the world on such terms and conditions and
in such manner as the Administrative Agent shall determine (other than in
violation of any then-existing licensing arrangements to the extent that waivers
cannot be obtained), and (b) to the extent permitted under applicable law, with
or without legal process and with or without prior notice or demand for
performance, to take possession of the Article 9 Collateral and without
liability for trespass to enter any premises where the Article 9 Collateral may
be located for the purpose of taking possession of or removing the Article 9
Collateral and, generally, to exercise any and all rights afforded to a secured
party under the Uniform Commercial Code or other applicable
law. Without limiting the generality of the foregoing, each Grantor
agrees that the Administrative Agent shall have the right, subject to the
mandatory requirements of applicable law, to sell or otherwise dispose of all or
any part of the Collateral at a public or private sale or at any broker’s board
or on any securities exchange, for cash, upon credit or for future delivery as
the Administrative Agent shall deem appropriate. The Administrative
Agent shall be authorized at any such sale of securities (if it deems it
advisable to do so) to restrict the prospective bidders or purchasers to Persons
who will represent and agree that they are purchasing the Collateral for their
own account for investment and not with a view to the distribution or sale
thereof, and upon consummation of any such sale the Administrative Agent shall
have the right to assign, transfer and deliver to the purchaser or purchasers
thereof the Collateral so sold. Each such purchaser at any sale of
Collateral shall hold the property sold absolutely free from any claim or right
on the part of any Grantor, and each Grantor hereby waives (to the extent
permitted by law) all rights of redemption, stay and appraisal that such Grantor
now has or may at any time in the future have under any rule of law or statute
now existing or hereafter enacted.
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The
Administrative Agent shall give the applicable Grantors 10 days’ written notice
(which each Grantor agrees is reasonable notice within the meaning of Section
9-611 of the New York UCC or its equivalent in other jurisdictions) of the
Administrative Agent’s intention to make any sale of Collateral. Such
notice, in the case of a public sale, shall state the time and place for such
sale and, in the case of a sale at a broker’s board or on a securities exchange,
shall state the board or exchange at which such sale is to be made and the day
on which the Collateral, or portion thereof, will first be offered for sale at
such board or exchange. Any such public sale shall be held at such
time or times within ordinary business hours and at such place or places as the
Administrative Agent may fix and state in the notice (if any) of such
sale. At any such sale, the Collateral , or portion thereof, to be
sold may be sold in one lot as an entirety or in separate parcels, as the
Administrative Agent may (in its sole and absolute discretion)
determine. The Administrative Agent shall not be obligated to make
any sale of any Collateral if it shall determine not to do so, regardless of the
fact that notice of sale of such Collateral shall have been
given. The Administrative Agent may, without notice or publication,
adjourn any public or private sale or cause the same to be adjourned from time
to time by announcement at the time and place fixed for sale, and such sale may,
without further notice, be made at the time and place to which the same was so
adjourned. In case any sale of all or any part of the Collateral is
made on credit or for future delivery, the Collateral so sold may be retained by
the Administrative Agent until the sale price is paid by the purchaser or
purchasers thereof, but the Administrative Agent shall not incur any liability
in case any such purchaser or purchasers shall fail to take up and pay for the
Collateral so sold and, in case of any such failure, such Collateral may be sold
again upon like notice. At any public (or, to the extent permitted by
law, private) sale made pursuant to this Agreement, any Secured Party may bid
for or purchase, free (to the extent permitted by law) from any right of
redemption, stay, valuation or appraisal on the part of any Grantor (all said
rights being also hereby waived and released to the extent permitted by law),
the Collateral or any part thereof offered for sale and may make payment on
account thereof by using any claim then due and payable to such Secured Party
from any Grantor as a credit against the purchase price, and such Secured Party
may, upon compliance with the terms of sale, hold, retain and dispose of such
property without further accountability to any Grantor therefor. For
purposes hereof, a written agreement to purchase the Collateral or any portion
thereof shall be treated as a sale thereof; the Administrative Agent shall be
free to carry out such sale pursuant to such agreement and no Grantor shall be
entitled to the return of the Collateral or any portion thereof subject thereto,
notwithstanding the fact that after the Administrative Agent shall have entered
into such an agreement all Events of Default shall have been remedied and the
Secured Obligations paid in full. As an alternative to exercising the
power of sale herein conferred upon it, the Administrative Agent may proceed by
a suit or suits at law or in equity to foreclose this Agreement and to sell the
Collateral or any portion thereof pursuant to a judgment or decree of a court or
courts having competent jurisdiction or pursuant to a proceeding by a
court-appointed receiver. Any sale pursuant to the provisions of this
Section 5.01 shall be deemed to conform to the commercially reasonable standards
as provided in Section 9-610(b) of the New York UCC or its equivalent in other
jurisdictions.
32
Upon the occurrence and during the continuance of an
Event of Default, the Administrative Agent may appoint, remove or reappoint by
instrument in writing, any Person or Persons, whether an officer or officers or
an employee or employees of any Grantor or not, to be an interim receiver,
receiver or receivers (hereinafter called a “Receiver”, which term when used
herein shall include a receiver and manager) of Collateral (including any
interest, income or profits therefrom)
located in Canada. Any such
Receiver shall, to the extent permitted by applicable law, be deemed the agent
of such Grantor and not of the Administrative Agent, and the exculpatory provisions of Section 11 of the
Credit Agreement shall apply to such
Receiver and its servants, agents or employees. Subject to
the provisions of the instrument appointing it, any such Receiver shall (i) have
such powers as have been granted to the Administrative Agent under this Article
V and (ii) shall be entitled to exercise such powers at any time that such
powers would otherwise be exercisable by the Administrative Agent under this
Article V, which powers shall include, but are not limited to, the power to take
possession of the Collateral, to preserve the Collateral or its value, to carry
on or concur in carrying on all or any part of the business of such Grantor and
to sell, lease, license or otherwise dispose of or concur in selling, leasing,
licensing or otherwise disposing of the Collateral. To facilitate the
foregoing powers, any such Receiver may, to the exclusion of all others,
including any Grantor, enter upon, use and occupy all premises owned or occupied
by such Grantor wherein the Collateral may be situate, maintain the Collateral
upon such premises, borrow money on a secured or unsecured basis and use the
Collateral directly in carrying on such Grantor’s business or as security for
loans or advances to enable the Receiver to carry on such Grantor’s business or
otherwise, as such Receiver shall, in its reasonable discretion,
determine. Except as may be otherwise directed by the Administrative
Agent, all money received from time to time by such Receiver in carrying out
his/her/its appointment shall be received in trust for and be paid over to the
Administrative Agent and any surplus shall be applied in accordance with
applicable law. Every such Receiver may, in the discretion of the
Administrative Agent, be vested with, in addition to the rights set out herein,
all or any of the rights and powers of the Administrative Agent described in the
Credit Agreement, the PPSA or the Bankruptcy and Insolvency Act (Canada).
SECTION
5.02. Application of
Proceeds. Subject to applicable law, the Administrative Agent
shall apply the proceeds of any collection or sale of Collateral, including any
Collateral consisting of cash, as follows:
FIRST, to the
payment of all costs and expenses incurred by the Administrative Agent in
connection with such collection or sale or otherwise in connection with this
Agreement, any other Loan Document or any of the Secured Obligations, including
all court costs and the fees and expenses of its agents and legal counsel, the
repayment of all advances made by the Administrative Agent hereunder or under
any other Loan Document on behalf of any Grantor and any other costs or expenses
incurred in connection with the exercise of any right or remedy hereunder or
under any other Loan Document in its capacity as such;
33
SECOND, to the
payment in full of the Secured Obligations secured by such Collateral (the
amounts so applied to be distributed among the applicable Secured Parties pro
rata in accordance with the amounts of the applicable Secured Obligations owed
to them on the date of any such distribution); and
THIRD, to the
Grantors, their successors or assigns, or as a court of competent jurisdiction
may otherwise direct.
The
Administrative Agent shall have absolute discretion as to the time of
application of any such proceeds, moneys or balances in accordance with this
Agreement. Upon any sale of Collateral by the Administrative Agent
(including pursuant to a power of sale granted by statute or under a judicial
proceeding), the receipt of the Administrative Agent or of the officer making
the sale shall be a sufficient discharge to the purchaser or purchasers of the
Collateral so sold and such purchaser or purchasers shall not be obligated to
see to the application of any part of the purchase money paid over to the
Administrative Agent or such officer or be answerable in any way for the
misapplication thereof. Notwithstanding the foregoing, no Proceeds of
Collateral securing solely the Foreign Secured Obligations shall be applied to
Domestic Secured Obligations.
SECTION
5.03. Grant
of License to Use Intellectual Property. For the purpose of
enabling the Administrative Agent to exercise rights and remedies under this
Agreement at such time as the Administrative Agent shall be lawfully entitled to
exercise such rights and remedies, each Grantor hereby grants to the
Administrative Agent an irrevocable, nonexclusive license (exercisable without
payment of royalty or other compensation to the Grantor) to use, license or
sublicense any of the Article 9 Collateral consisting of Intellectual Property
now owned or hereafter acquired by such Grantor, in each case wherever the same
may be located, and including in such license reasonable access to all media in
which any of the licensed items may be recorded or stored and to all computer
software and programs used for the compilation or printout
thereof. The use of such license by the Administrative Agent may be
exercised, at the option of the Administrative Agent, upon the occurrence and
during the continuation of an Event of Default, provided that any
license, sublicense or other transaction entered into by the Administrative
Agent in accordance herewith shall be binding upon the Grantors notwithstanding
any subsequent cure of an Event of Default.
SECTION
5.04. Securities
Act. In view of the position of the Grantors in relation to
the Pledged Collateral, or because of other current or future circumstances, a
question may arise under the Securities Act of 1933, as now or hereafter in
effect, or any similar statute hereafter enacted in any jurisdiction analogous
in purpose or effect (such Act and any such similar statute as from time to time
in effect being called the “Federal Securities
Laws”) with respect to any disposition of the Pledged Collateral
permitted hereunder. Each Grantor understands that compliance with
the Federal Securities Laws might very strictly limit the course of conduct of
the Administrative Agent if the Administrative Agent were to attempt to dispose
of all or any part of the Pledged Collateral, and might also limit the extent to
which or the manner in which any subsequent transferee of any Pledged Collateral
could dispose of the same. Similarly, there may be other legal
restrictions or limitations affecting the Administrative Agent in any attempt to
dispose of all or part of the Pledged Collateral under applicable Blue Sky or
other state securities laws or similar laws analogous in purpose or effect in the United
States, Canada or any other
country. Each Grantor recognizes that in light of such
restrictions and limitations the Administrative Agent may, with respect to any
sale of the Pledged Collateral, limit the purchasers to those who will agree,
among other things, to acquire such Pledged Collateral for their own account,
for investment, and not with a view to the distribution or resale
thereof. Each Grantor acknowledges and agrees that in light of such
restrictions and limitations, the Administrative Agent, in its sole and absolute
discretion, (a) may proceed to make such a sale whether or not a registration
statement for the purpose of registering such Pledged Collateral or part thereof
shall have been filed under the Federal Securities Laws and (b) may approach and
negotiate with a single potential purchaser to effect such sale. Each
Grantor acknowledges and agrees that any such sale might result in prices and
other terms less favorable to the seller than if such sale were a public sale
without such restrictions. In the event of any such sale, the
Administrative Agent shall incur no responsibility or liability for selling all
or any part of the Pledged Collateral at a price that the Administrative Agent,
in its sole and absolute discretion, may in good xxxxx xxxx reasonable under the
circumstances, notwithstanding the possibility that a substantially higher price
might have been realized if the sale were deferred until after registration as
aforesaid or if more than a single purchaser were approached. The
provisions of this Section 5.04 will apply notwithstanding the existence of a
public or private market upon which the quotations or sales prices may exceed
substantially the price at which the Administrative Agent
sells.
34
ARTICLE
VI
Indemnity, Subrogation and
Subordination
SECTION
6.01. Indemnity and
Subrogation. In addition to all such rights of indemnity and
subrogation as the Guarantors and Grantors may have under applicable law (but
subject to Section 6.03), each Borrower agrees that (a) in the event a payment
in respect of any obligation shall be made by any Guarantor under this
Agreement, the Company shall indemnify such Guarantor for the full amount of
such payment and such Guarantor shall be subrogated to the rights of the Person
to whom such payment shall have been made to the extent of such payment and (b)
in the event any assets of any Grantor shall be sold pursuant to this Agreement
or any other Security Document to satisfy in whole or in part a Secured
Obligation owed to any Secured Party, the Company shall indemnify such Grantor
in an amount equal to the greater of the book value or the fair market value of
the assets so sold.
SECTION
6.02. Contribution and
Subrogation. Each Guarantor and Grantor (a “Contributing Party”)
agrees (subject to Section 6.03) that, in the event a payment shall be made by
any other Guarantor hereunder in respect of any Secured Obligation in respect of
which the Contributing Party is liable hereunder or assets of any other Grantor
(other than the Company) shall be sold pursuant to any Security Document to
satisfy any Secured Obligation in respect of which the Contributing Party is
liable hereunder and such other Guarantor or Grantor (the “Claiming Party”)
shall not have been fully indemnified by the Company as provided in Section
6.01, the Contributing Party shall indemnify the Claiming Party in an amount
equal to the amount of such payment or the greater of the book value or the fair
market value of such assets, as the case may be, in each case multiplied by a
fraction of which the numerator shall be the net worth of the Contributing Party
on the date hereof and the denominator shall be the aggregate net worth of all
the Guarantors and Grantors liable for such Secured Obligation, or that have
granted Liens to secure such Secured Obligation, on the date hereof (or, in the
case of any Guarantor or Grantor becoming a party hereto pursuant to Section
7.17, the date of the supplement hereto executed and delivered by such Guarantor
or Grantor). Any Contributing Party making any payment to a Claiming
Party pursuant to this Section 6.02 shall (subject to Section 6.03) be
subrogated to the rights of such Claiming Party under Section 6.01 to the extent
of such payment.
35
SECTION
6.03. Limitations,
Subordination. Notwithstanding any provision of this Agreement
to the contrary, to the extent permitted by law and to the extent to do so would
not constitute unlawful financial assistance, the Guarantors and Grantors shall
have no rights under Sections 6.01 and 6.02 and shall not exercise any other
rights of indemnity, contribution or subrogation under applicable law or
otherwise until all of the payment in full in cash of the Secured Obligations
owed by the Loan Party against whom the Guarantor or Grantor would otherwise
have rights under Section 6.01 or 6.02. No failure on the part of the
Company or any Guarantor or Grantor to make the payments required by Sections
6.01 and 6.02 (or any other payments required under applicable law or otherwise)
shall in any respect limit the obligations and liabilities of any Guarantor or
Grantor with respect to its obligations hereunder, and each Guarantor and
Grantor shall remain liable for the full amount of the obligations of such
Guarantor or Grantor hereunder.
ARTICLE
VII
Miscellaneous
SECTION
7.01. Notices. All
communications and notices hereunder shall (except as otherwise expressly
permitted herein) be in writing and given as provided in subsection 12.2 of the
Credit Agreement. All communications and notices hereunder to any
Subsidiary Loan Party shall be given to it in care of the Company as provided in
subsection 12.2 of the Credit Agreement.
SECTION
7.02. Waivers;
Amendment. i)No failure or delay by the Administrative Agent,
the Issuing Bank or any Secured Party in exercising any right or power hereunder
or under any other Loan Document shall operate as a waiver thereof, nor shall
any single or partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such a right or power, preclude any other or
further exercise thereof or the exercise of any other right or
power. The rights and remedies of the Administrative Agent, the
Issuing Bank and the Secured Parties hereunder and under the other Loan
Documents are cumulative and are not exclusive of any rights or remedies that
they would otherwise have. No waiver of any provision of this
Agreement or consent to any departure by any Loan Party therefrom shall in any
event be effective unless the same shall be permitted by paragraph (b) of this
Section 7.02, and then such waiver or consent shall be effective only in the
specific instance and for the purpose for which given. Without
limiting the generality of the foregoing, the making of a Loan or issuance of a
Letter of Credit shall not be construed as a waiver of any Default, regardless
of whether the Administrative Agent, any Extended Tranche Lender or the Issuing
Bank may have had notice or knowledge of such Default at the time. No
notice or demand on any Loan Party in any case shall entitle any Loan Party to
any other or further notice or demand in similar or other
circumstances.
36
(b) Neither
this Agreement nor any provision hereof may be waived, amended or modified
except pursuant to an agreement or agreements in writing entered into by the
Administrative Agent and the Loan Party or Loan Parties with respect to which
such waiver, amendment or modification is to apply, subject to any consent
required in accordance with subsections 12.1 and 12.1A of the Credit
Agreement.
SECTION
7.03. Administrative Agent’s Fees
and Expenses; Indemnification. i)The parties hereto agree that
the Administrative Agent shall be entitled to reimbursement of its expenses
incurred hereunder as provided in subsection 12.5 of the Credit
Agreement.
(b) Without
limitation of its indemnification obligations under the other Loan Documents,
each Grantor and each Guarantor jointly and severally agrees to indemnify the
Administrative Agent and the other Indemnitees against, and hold each Indemnitee
harmless from, any and all losses, claims, damages, liabilities and related
expenses, including the fees, charges and disbursements of any counsel for any
Indemnitee, incurred by or asserted against any Indemnitee by any third party or
by any Guarantor or Grantor arising out of, in connection with, or as a result
of, the execution, delivery or performance of this Agreement or any claim,
litigation, investigation or proceeding relating to any of the foregoing
agreement or instrument contemplated hereby, or to the Collateral, whether or
not any Indemnitee is a party thereto, provided that such
indemnity shall not, as to any Indemnitee, be available to the extent that such
losses, claims, damages, liabilities or related expenses are determined by a
court of competent jurisdiction by final judgment to have resulted from the
gross negligence or wilful misconduct of such Indemnitee.
(c) Any
such amounts payable as provided hereunder shall be additional Secured
Obligations secured hereby and by the other Security Documents. The
provisions of this Section 7.03 shall remain operative and in full force and
effect regardless of the termination of this Agreement or any other Loan
Document, the consummation of the transactions contemplated hereby, the
repayment of any of the Secured Obligations, the invalidity or unenforceability
of any term or provision of this Agreement or any other Loan Document or any
investigation made by or on behalf of the Administrative Agent or any other
Secured Party. All amounts due under this Section 7.03 shall be
payable on written demand therefor.
37
SECTION
7.04. Successors and
Assigns. Whenever in this Agreement any of the parties hereto
is referred to, such reference shall be deemed to include the permitted
successors and assigns of such party; and all covenants, promises and agreements
by or on behalf of any Guarantor, Grantor or the Administrative Agent that are
contained in this Agreement shall bind and inure to the benefit of their
respective successors and assigns.
SECTION
7.05. Survival of
Agreement. All covenants, agreements, representations and
warranties made by the Loan Parties in the Loan Documents and in the
certificates or other instruments prepared or delivered in connection with or
pursuant to this Agreement or any other Loan Document shall be considered to
have been relied upon by the Secured Parties and shall survive the execution and
delivery of the Loan Documents and the making of any Loans and issuance of any
Letters of Credit, regardless of any investigation made by any Secured Party or
on its behalf and notwithstanding that the Administrative Agent, the Issuing
Bank or any Secured Party may have had notice or knowledge of any Default or
incorrect representation or warranty at the time any credit is extended under
the Credit Agreement, and shall continue in full force and effect as long as the
principal of or any accrued interest on any Extended Tranche Loan or any fee or
any other amount payable under any Loan Document is outstanding and unpaid or
any Letter of Credit is outstanding and so long as the Extended Tranche
Commitments have not expired or terminated.
SECTION
7.06. Counterparts; Effectiveness;
Several Agreement. This Agreement may be executed in
counterparts, each of which shall constitute an original but all of which when
taken together shall constitute a single contract. Delivery of an
executed signature page to this Agreement by facsimile or electronic
transmission shall be effective as delivery of a manually signed counterpart of
this Agreement. This Agreement shall become effective as to any Loan
Party when a counterpart hereof executed on behalf of such Loan Party shall have
been delivered to the Administrative Agent and a counterpart hereof shall have
been executed on behalf of the Administrative Agent, and thereafter shall be
binding upon such Loan Party and the Administrative Agent and their respective
permitted successors and assigns, and shall inure to the benefit of such Loan
Party, the Administrative Agent and the other Secured Parties and their
respective successors and assigns, except that no Loan Party shall have the
right to assign or transfer its rights or obligations hereunder or any interest
herein or in the Collateral (and any such assignment or transfer shall be void)
except as expressly provided in this Agreement or the Credit
Agreement. This Agreement shall be construed as a separate agreement
with respect to each Loan Party and may be amended, modified, supplemented,
waived or released with respect to any Loan Party without the approval of any
other Loan Party and without affecting the obligations of any other Loan Party
hereunder.
SECTION
7.07. Severability; Limitation by
Law. Any provision of this Agreement held to be invalid,
illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such invalidity, illegality or unenforceability
without affecting the validity, legality and enforceability of the remaining
provisions hereof; and the invalidity of a particular provision in a particular
jurisdiction shall not invalidate such provision in any other
jurisdiction. The parties shall endeavor in good-faith negotiations
to replace the invalid, illegal or unenforceable provisions with valid
provisions the economic effect of which comes as close as possible to that of
the invalid, illegal or unenforceable provisions. All rights,
remedies and powers provided in this Agreement may be exercised only to the
extent that the exercise thereof does not violate any applicable provision of
law, and all the provisions of this Agreement are intended to be subject to all
applicable mandatory provisions of law that may be controlling and to be limited
to the extent necessary so that they shall not render this Agreement invalid,
unenforceable, in whole or in part, or not entitled to be recorded, registered
or filed under the provisions of any applicable law.
38
SECTION
7.08. Right
of Set-Off. If an Event of Default shall have occurred and be
continuing, each Secured Party is hereby authorized at any time and from time to
time, to the fullest extent permitted by law, to set off and apply any and all
deposits (general or special, time or demand, provisional or final) at any time
held and other obligations at any time owing by such Secured Party to or for the
credit or the account of any Guarantor against any of and all the obligations of
such Guarantor now or hereafter existing under this Agreement owed to such
Secured Party, irrespective of whether or not such Secured Party shall have made
any demand under this Agreement and although such obligations may be
unmatured. The rights of each Secured Party under this Section 7.08
are in addition to other rights and remedies (including other rights of set-off)
that such Secured Party may have.
SECTION
7.09. Governing Law; Jurisdiction;
Consent to Service of Process. i)This Agreement shall be
construed in accordance with and governed by the law of the State of New York,
provided that
the provisions set forth in Section 2.04 shall be construed in accordance with
and governed by the laws of the Federal Republic of Germany.
(b) Each
of the Loan Parties hereby irrevocably and unconditionally submits, for itself
and its property, to the exclusive jurisdiction of the Supreme Court of the
State of New York sitting in New York County and of the United States District
Court of the Southern District of New York, and any appellate court from any
thereof, in any action or proceeding arising out of or relating to this
Agreement or any other Loan Document, or for recognition or enforcement of any
judgment, and each of the parties hereto hereby irrevocably and unconditionally
agrees that all claims in respect of any such action or proceeding may be heard
and determined in such New York State or, to the extent permitted by law, in
such Federal court. Each of the Loan Parties hereto agrees that a
final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law. Nothing in this Agreement or any other Loan Document
shall affect any right that the Administrative Agent, the Issuing Bank or any
Extended Tranche Lender may otherwise have to bring any action or proceeding
relating to this Agreement or any other Loan Document against any Grantor,
Guarantor, or their respective properties in the courts of any
jurisdiction.
39
(c) Each
of the Loan Parties hereby irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection that it may
now or hereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to this Agreement or any other Loan Document in any
court referred to in paragraph (b) of this Section 7.09. Each of the
Loan Parties hereto hereby irrevocably waives, to the fullest extent permitted
by law, the defense of an inconvenient forum to the maintenance of such action
or proceeding in any such court.
(d) Each
party to this Agreement irrevocably consents to service of process in the manner
provided for notices in Section 7.01. Nothing in this Agreement or
any other Loan Document will affect the right of any party to this Agreement to
serve process in any other manner permitted by law.
SECTION
7.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF
OR RELATING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER
THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE,
AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE,
THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE
BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL
WAIVERS AND CERTIFICATIONS IN THIS SECTION 7.10.
SECTION
7.11. Headings. Article
and Section headings and the Table of Contents used herein are for convenience
of reference only, are not part of this Agreement and shall not affect the
construction of, or be taken into consideration in interpreting, this
Agreement.
SECTION
7.12. Security Interest
Absolute. To the extent permitted by law, all rights of the
Administrative Agent hereunder, the Security Interest, the grant of a security
interest in the Pledged Collateral and all obligations of each Grantor and
Guarantor hereunder shall be absolute and unconditional irrespective of (a) any
lack of validity or enforceability of the Credit Agreement, any other Loan
Document, any agreement with respect to any of the Secured Obligations or any
other agreement or instrument relating to any of the foregoing, (b) any change
in the time, manner or place of payment of, or in any other term of, all or any
of the Secured Obligations, or any other amendment or waiver of or any consent
to any departure from the Credit Agreement, any other Loan Document or any other
agreement or instrument, (c) any exchange, release or non-perfection of any Lien
on other collateral, or any release or amendment or waiver of or consent under
or departure from any guarantee, securing or guaranteeing all or any of the
Secured Obligations, or (d) any other circumstance that might otherwise
constitute a defense available to, or a discharge of, any Grantor or Guarantor
in respect of the Secured Obligations or this Agreement.
40
SECTION
7.13. Attachment of Security
Interest. For purposes of the PPSA, the security interest created hereby is intended to
attach, in respect of Collateral in which any Grantor has rights at the time
this Agreement is signed by such Grantor and delivered to the Administrative
Agent, at the time this Agreement is signed by such Grantor and delivered to the
Administrative Agent and, in respect of Collateral in which any Grantor
subsequently acquires rights, at the time such Grantor subsequently acquires
such rights. The Grantors acknowledge and confirm that value has been
given by the Administrative Agent and the Secured Parties to the
Grantors.
SECTION
7.14. Copy
of Agreement; Verification Statement. The Grantors hereby acknowledge receipt of
a signed copy of this Agreement and hereby waive the requirement to be provided
with a copy of any verification statement issued in respect of a financing
statement or financing change statement filed under the PPSA in connection with
this Agreement to perfect the security interest created
herein.
SECTION
7.15. No
Subordination. Notwithstanding
anything to the contrary contained in this Agreement, the Credit Agreement or
any other Loan Document (including any provision for, reference to, or
acknowledgement of, any Lien or Permitted Lien), nothing herein and no approval
by the Administrative Agent or any Secured Party of any Lien or Permitted Lien
(whether such approval is oral or in writing) shall be construed as or deemed to
constitute a subordination by the Administrative Agent or any Secured Party of
any security interest or other right, interest or Lien in or to the Collateral
or any part thereof in favor of any Lien or Permitted Lien or any holder of any
Lien or Permitted Lien.
SECTION
7.16. Termination or
Release. i)This Agreement, the guarantees made herein, the
Security Interest and all other security interests granted hereby shall
terminate when all the Extended Tranche Obligations have been paid in full and
the Extended Tranche Lenders have no further commitment to lend under the Credit
Agreement, the L/C Obligations have been reduced to zero and the Issuing Bank
has no further obligations to issue Letters of Credit under the Credit
Agreement.
(b) A
Subsidiary Loan Party (other than the Additional Borrower) shall automatically
be released from its obligations hereunder and the Security Interest in the
Collateral of such Subsidiary Loan Party shall be automatically released upon
the consummation of any transaction permitted by the Credit Agreement as a
result of which such Subsidiary Loan Party ceases to be a Subsidiary, provided that the
Majority Extended Tranche Lenders shall have consented to such transaction (to
the extent required by the Credit Agreement) and the terms of such consent did
not provide otherwise.
41
(c) Upon
any sale or other transfer by any Grantor of any Collateral that is permitted
under the Credit Agreement (other than a sale or other transfer to a Borrower or
any Subsidiary), or upon the effectiveness of any written consent to the release
of the security interest granted hereby in any Collateral pursuant to subsection
12.1A of the Credit Agreement, the security interest in such Collateral shall be
automatically released.
(d) In
connection with any termination or release pursuant to paragraph (a), (b) or (c)
of this Section 7.16, the Administrative Agent shall execute and deliver to any
Grantor, at such Grantor’s expense, all documents that such Grantor shall
reasonably request to evidence such termination or release. Any
execution and delivery of documents pursuant to this Section 7.16 shall be
without recourse to or warranty by the Administrative Agent.
SECTION
7.17. Additional
Subsidiaries. Upon execution and delivery by the
Administrative Agent and a Subsidiary of an instrument in the form of Exhibit I
hereto, such Subsidiary shall become a Subsidiary Loan Party and a Guarantor and
a Grantor hereunder with the same force and effect as if originally named as a
Subsidiary Loan Party and a Guarantor and a Grantor herein. The
execution and delivery of any such instrument shall not require the consent of
any other Loan Party hereunder. The rights and obligations of each
Loan Party hereunder shall remain in full force and effect notwithstanding the
addition of any new Loan Party as a party to this Agreement.
SECTION
7.18. Administrative Agent
Appointed Attorney-in-Fact. Each Grantor hereby appoints the
Administrative Agent the attorney-in-fact of such Grantor for the purpose of
carrying out the provisions of this Agreement and taking any action and
executing any instrument that the Administrative Agent may deem necessary or
advisable to accomplish the purposes hereof, which appointment is irrevocable
and coupled with an interest. Without limiting the generality of the
foregoing, the Administrative Agent shall have the right, upon the occurrence
and during the continuance of an Event of Default, with full power of
substitution either in the Administrative Agent’s name or in the name of such
Grantor (a) to receive, endorse, assign and/or deliver any and all notes,
acceptances, checks, drafts, money orders or other evidences of payment relating
to the Collateral or any part thereof; (b) to demand, collect, receive payment
of, give receipt for and give discharges and releases of all or any of the
Collateral; (c) to sign the name of any Grantor on any invoice or xxxx of lading
relating to any of the Collateral; (d) to send verifications of Accounts
Receivable to any Account Debtor; (e) to commence and prosecute any and all
suits, actions or proceedings at law or in equity in any court of competent
jurisdiction to collect or otherwise realize on all or any of the Collateral or
to enforce any rights in respect of any Collateral; (f) to settle, compromise,
compound, adjust or defend any actions, suits or proceedings relating to all or
any of the Collateral; (g) to notify, or to require any Grantor to notify,
Account Debtors to make payment directly to the Administrative Agent; and (h) to
use, sell, assign, transfer, pledge, make any agreement with respect to or
otherwise deal with all or any of the Collateral, and to do all other acts and
things necessary to carry out the purposes of this Agreement, as fully and
completely as though the Administrative Agent were the absolute owner of the
Collateral for all purposes, provided that nothing
herein contained shall be construed as requiring or obligating the
Administrative Agent to make any commitment or to make any inquiry as to the
nature or sufficiency of any payment received by the Administrative Agent, or to
present or file any claim or notice, or to take any action with respect to the
Collateral or any part thereof or the moneys due or to become due in respect
thereof or any property covered thereby. The Administrative Agent and
the other Secured Parties shall be accountable only for amounts actually
received as a result of the exercise of the powers granted to them herein, and
neither they nor their officers, directors, employees or agents shall be
responsible to any Grantor for any act or failure to act hereunder, except for
their own gross negligence or wilful misconduct.
42
SECTION
7.19. Xxxxxx International
Guarantee. This Agreement does not supersede or replace
the Xxxxxx International Guarantee, which shall remain in full force and
effect.
[Signature
Pages Follow]
43
IN
WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the
day and year first above written.
XXXXXX
INTERNATIONAL INDUSTRIES, INCORPORATED,
|
||
By /s/
Xxxx X. Xxxx
|
||
Name:
Xxxx X. Xxxx
|
||
Title: VP,
General Counsel &
Secretary
|
HARMAN
HOLDING GMBH & CO. KG,
|
||
By:
|
||
Harman
Management GmbH, as General Partner
|
||
By:
/s/ Xxxxx Xxxxxxx
|
||
Name:
Xxxxx Xxxxxxx
|
||
Title: Managing
Director
|
CROWN
AUDIO, INC.,
|
||
By:
/s/ Xxxx X. Xxxx
|
||
Name:
Xxxx X. Xxxx
|
||
Title: VP
& Secretary
|
XXXXXX
XXXXXX AUTOMOTIVE SYSTEMS, INC.,
|
||
By /s/
Xxxx X. Xxxx
|
||
Name:
Xxxx X. Xxxx
|
||
Title: VP
& Secretary
|
XXXXXX
XXXXXX AUTOMOTIVE SYSTEMS (MICHIGAN), INC.,
|
||
By: /s/
Xxxx X. Xxxx
|
||
Name:
Xxxx X. Xxxx
|
||
Title: VP
& Secretary
|
44
HARMAN
CONSUMER GROUP, INC.,
|
||
By: /s/
Xxxx X. Xxxx
|
||
Name:
Xxxx X. Xxxx
|
||
Title: VP
& Secretary
|
HARMAN
FINANCIAL GROUP LLC,
|
||
By: /s/
Xxxx X. Xxxx
|
||
Name:
Xxxx X. Xxxx
|
||
Title: VP
& Secretary
|
HARMAN
MUSIC GROUP, INCORPORATED,
|
||
By: /s/
Xxxx X. Xxxx
|
||
Name:
Xxxx X. Xxxx
|
||
Title: VP
& Secretary
|
HBAS
MANUFACTURING, INC.,
|
||
By: /s/
Xxxx X. Xxxx
|
||
Name:
Xxxx X. Xxxx
|
||
Title: VP
& Secretary
|
JBL
INCORPORATED,
|
||
By: /s/
Xxxx X. Xxxx
|
||
Name:
Xxxx X. Xxxx
|
||
Title: VP
& Secretary
|
LEXICON,
INCORPORATED,
|
||
By: /s/
Xxxx X. Xxxx
|
||
Name:
Xxxx X. Xxxx
|
||
Title: VP
& Secretary
|
45
XXXXX
SYSTEMS, INC.,
|
||
By: /s/
Xxxx X. Xxxx
|
||
Name:
Xxxx X. Xxxx
|
||
Title: VP
& Secretary
|
QNX
SOFTWARE SYSTEMS, INC.,
|
||
By: /s/
Xxxx X. Xxxx
|
||
Name:
Xxxx X. Xxxx
|
||
Title: VP
& Secretary
|
XXXXXX
SERVICE UND VERWALTUNG GMBH,
|
||
By: /s/
Xxxxx Xxxxxxx
|
||
Name:
Xxxxx Xxxxxxx
|
||
Title: Managing
Director
|
INNOVATIVE
SYSTEMS GMBH NAVIGATION-MULTIMEDIA,
|
||
By: /s/
Xxxxx Xxxxxxx
|
||
Name:
Xxxxx Xxxxxxx
|
||
Title: Managing
Director
|
HARMAN
DEUTSCHLAND GMBH,
|
||
By: /s/
Xxxxx Xxxxxxx
|
||
Name:
Xxxxx Xxxxxxx
|
||
Title: Managing
Director
|
HARMAN
XXXXXX AUTOMOTIVE SYSTEMS HOLDING GMBH,
|
||
By: /s/
Xxxxx Xxxxxxx
|
||
Name:
Xxxxx Xxxxxxx
|
||
Title: Managing
Director
|
46
XS
EMBEDDED GMBH,
|
||
By: /s/
Xxxxx Xxxxxxx
|
||
Name:
Xxxxx Xxxxxxx
|
||
Title: Managing
Director
|
HARMAN
SOFTWARE TECHNOLOGY INTERNATIONAL BETEILIGUNGS GMBH,
|
||
By: /s/
Xxxxx Xxxxxxx
|
||
Name:
Xxxxx Xxxxxxx
|
||
Title: Managing
Director
|
HBAS
INTERNATIONAL GMBH,
|
||
By: /s/
Xxxxx Xxxxxxx
|
||
Name:
Xxxxx Xxxxxxx
|
||
Title: Managing
Director
|
HARMAN
SOFTWARE TECHNOLOGY MANAGEMENT GMBH,
|
||
By: /s/
Xxxxx Xxxxxxx
|
||
Name:
Xxxxx Xxxxxxx
|
||
Title: Managing
Director
|
QNX
SOFTWARE SYSTEMS GMBH & CO. KG,
|
||
By:
|
||
Harman
Software Technology
Management
GmbH, as General Partner
|
||
By: /s/
Xxxxx Xxxxxxx
|
||
Name:
Xxxxx Xxxxxxx
|
||
Title: Managing
Director
|
47
QNX
SOFTWARE SYSTEMS GMBH,
|
||
By: /s/
Xxxxx Xxxxxxx
|
||
Name:
Xxxxx Xxxxxxx
|
||
Title: Managing
Director
|
QNX
SOFTWARE SYSTEMS CO.,
|
||
By: /s/
Xxx Xxxxx
|
||
Name:
Xxx Xxxxx
|
||
Title: Chief
Executive Officer and Chief Technology
Officer
|
QNX
SOFTWARE SYSTEMS INTERNATIONAL CORPORATION,
|
||
By: /s/
Xxx Xxxxx
|
||
Name:
Xxx Xxxxx
|
||
Title: President
|
QNX
SOFTWARE SYSTEMS (WAVEMAKERS), INC.,
|
||
By: /s/
Xxx Xxxxx
|
||
Name:
Xxx Xxxxx
|
||
Title: President
|
QNX
SOFTWARE SYSTEMS CANADA CORPORATION,
|
||
By: /s/
Xxx Xxxxx
|
||
Name:
Xxx Xxxxx
|
||
Title: President
|
48
JPMORGAN
CHASE BANK, N.A., as
Administrative
Agent,
|
||
By: /s/
Xxxxx Xxxxx
|
||
Name:
Xxxxx Xxxxx
|
||
Title: Vice
President
|
49
Schedule
I to
the
Guarantee and
Collateral
Agreement
SUBSIDIARY
PARTIES
Schedule
II to
the
Guarantee and
Collateral
Agreement
CAPITAL
STOCK
Issuer
|
Number
of
Certificate
|
Registered
Owner
|
Number
and
Class
of
Equity Interest
|
Percentage
of Capital
Stock
|
DEBT
SECURITIES
Issuer
|
Principal
Amount
|
Date of Note
|
Maturity
Date
|
Schedule
III to
the
Guarantee and
Collateral
Agreement
U.S.
COPYRIGHTS OWNED BY [NAME OF GRANTOR]
U.S. Copyright
Registrations
Registered Owner
|
Title
|
Reg. No.
|
Author
|
Pending U.S. Copyright
Applications for Registration
Registered Owner
|
Title
|
Author
|
Class
|
Date
Filed
|
Schedule
VI to
the
Guarantee and
Collateral
Agreement
Commercial
Tort Claims
Claim
|
Description
|
Exhibit I
to the
Guarantee
and
Collateral
Agreement
SUPPLEMENT
NO. __ dated as of [ ] (this “Supplement”), to the Guarantee and
Collateral Agreement dated as of March 31, 2009 (the “Collateral
Agreement”), among XXXXXX INTERNATIONAL INDUSTRIES, INCORPORATED, a
Delaware corporation (the “Company”), HARMAN
HOLDING GMBH & CO. KG, a company organized under German law (the “Additional
Borrower”), each subsidiary of the Company listed on Schedule I thereto
(each such subsidiary individually a “Subsidiary Guarantor” and,
collectively, the “Subsidiary Guarantors”; the
Subsidiary Guarantors, and the Company are referred to collectively herein as
the “Grantors”)
and JPMORGAN CHASE BANK, N.A., a national banking association (“JPMCB”), as
Administrative Agent (in such capacity, the “Administrative
Agent”).
A. Reference
is made to the Second Amended and Restated Multi-Currency, Multi-Option Credit
Agreement dated as of March 31, 2009 (as amended, supplemented or otherwise
modified from time to time, the “Credit Agreement”),
among the Company, the Additional Borrower, the Lenders party thereto, the other
parties thereto and JPMCB, as Administrative Agent.
B. Capitalized
terms used herein and not otherwise defined herein shall have the meanings
assigned to such terms in the Credit Agreement and the Collateral
Agreement.
C. The
Grantors have entered into the Collateral Agreement in order to induce the
Extended Tranche Lenders to make certain accommodations under the Credit
Agreement and to continue to make Extended Tranche Loans. Section
7.17 of the Collateral Agreement provides that additional Subsidiaries of the
Borrower may become Subsidiary Loan Parties, Guarantors and Grantors under the
Collateral Agreement by execution and delivery of an instrument in the form of
this Supplement. The undersigned Subsidiary (the “New Subsidiary”) is
executing this Supplement in accordance with the requirements of the Credit
Agreement to become a Subsidiary Loan Party and Guarantor and a Grantor, under
the Collateral Agreement in order to induce the Extended Tranche Lenders to make
additional Extended Tranche Loans and as consideration for Extended Tranche
Loans previously made and Letters of Credit previously issued.
Accordingly,
the Administrative Agent and the New Subsidiary agree as follows:
SECTION
1. In accordance with Section 7.17 of the Collateral
Agreement, the New Subsidiary by its signature below becomes a Subsidiary Loan
Party and a Guarantor and a Grantor, under the Collateral Agreement with the
same force and effect as if originally named therein as a Subsidiary Loan Party,
and Guarantor and Grantor, and the New Subsidiary hereby (a) agrees to all the
terms and provisions of the Collateral Agreement applicable to it as a
Subsidiary Loan Party, Guarantor and Grantor, thereunder and (b) represents and
warrants that the representations and warranties made by it as a Grantor and
Guarantor thereunder are true and correct on and as of the date
hereof. In furtherance of the foregoing, the New Subsidiary, as
security for the payment and performance in full of the [Secured
Obligations][Foreign Secured Obligations] (as defined in the Collateral
Agreement), does hereby create and grant to the Administrative Agent, its
successors and assigns, for the benefit of the Secured Parties, their successors
and assigns, a security interest in and lien on all of the New Subsidiary’s
right, title and interest in and to the Collateral (as defined in the Collateral
Agreement) of the New Subsidiary. Each reference to a “Guarantor” or
“Grantor” in the Collateral Agreement shall be deemed to include the New
Subsidiary. The Collateral Agreement is hereby incorporated herein by
reference.
SECTION
2. The New Subsidiary represents and warrants to the
Administrative Agent and the other Secured Parties that this Supplement has been
duly authorized, executed and delivered by it and constitutes its legal, valid
and binding obligation, enforceable against it in accordance with its
terms.
SECTION
3. This Supplement may be executed in counterparts (and by
different parties hereto on different counterparts), each of which shall
constitute an original, but all of which when taken together shall constitute a
single contract. This Supplement shall become effective when the Administrative
Agent shall have received a counterpart of this Supplement that bears the
signature of the New Subsidiary and the Administrative Agent has executed a
counterpart hereof. Delivery of an executed signature page to this
Supplement by facsimile transmission shall be effective as delivery of a
manually signed counterpart of this Supplement.
SECTION
4. The New Subsidiary hereby represents and warrants that (a)
set forth on Schedule I attached hereto is a schedule with the true and correct
legal name of the New Subsidiary, its jurisdiction of formation and the location
of its chief executive office, (b) set forth on Schedule II attached hereto is a
true and correct schedule of all the Pledged Securities of the New Subsidiary
and (c) if applicable, set forth on Schedule III attached hereto is a true and
correct schedule of Intellectual Property consisting of Copyrights, Patents and
Trademarks of the New Subsidiary.
SECTION
5. Except as expressly supplemented hereby, the Collateral
Agreement shall remain in full force and effect.
SECTION
6. THIS SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK.
SECTION
7. In case any one or more of the provisions contained in this
Supplement should be held invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein and in the Collateral Agreement shall not in any way be affected or
impaired thereby (it being understood that the invalidity of a particular
provision in a particular jurisdiction shall not in and of itself affect the
validity of such provision in any other jurisdiction). The parties
hereto shall endeavor in good-faith negotiations to replace the invalid, illegal
or unenforceable provisions with valid provisions the economic effect of which
comes as close as possible to that of the invalid, illegal or unenforceable
provisions.
2
SECTION
8. All communications and notices hereunder shall be in
writing and given as provided in Section 7.01 of the Collateral
Agreement.
SECTION
9. The New Subsidiary agrees to reimburse the Administrative
Agent for its reasonable out-of-pocket expenses in connection with this
Supplement, including the reasonable fees, other charges and disbursements of
counsel for the Administrative Agent.
IN
WITNESS WHEREOF, the New Subsidiary and the Administrative Agent have duly
executed this Supplement to the Collateral Agreement as of the day and year
first above written.
[NAME
OF NEW SUBSIDIARY],
|
||
by
|
||
Name:
|
||
Title:
|
||
Legal
Name:
|
||
Jurisdiction
of Formation:
|
||
Location
of Chief Executive
office:
|
JPMORGAN
CHASE BANK, N.A.,
as
Administrative Agent
|
||
by
|
||
Name:
|
||
Title:
|
3
Schedule
I
to
Supplement No. __ to the
Guarantee
and
Collateral
Agreement
NEW
SUBSIDIARY INFORMATION
Name
|
Jurisdiction of Formation
|
Chief Executive
Office
|
Schedule
II
to
Supplement No. __ to the
Guarantee
and
Collateral
Agreement
PLEDGED
SECURITIES
Capital
Stock
Issuer
|
Number
of
Certificate
|
Registered
Owner
|
Number
and
Class
of
Capital Stock
|
Percentage
of Capital
Stock
|
Debt
Securities
Issuer
|
Principal
Amount
|
Date of Note
|
Maturity
Date
|
Schedule
III
to
Supplement No. __ to the
Guarantee
and
Collateral
Agreement
INTELLECTUAL
PROPERTY
Schedule
IV
to
Supplement No. __ to the
Guarantee
and
Collateral
Agreement
COMMERCIAL
TORT CLAIMS