EXHIBIT 10.2
EXECUTION COPY
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GUARANTEE AND COLLATERAL AGREEMENT
made by
SUNSHINE ACQUISITION CORPORATION
SUNSHINE ACQUISITION II, INC.
SS&C TECHNOLOGIES, INC.
and certain of its Subsidiaries
in favor of
JPMORGAN CHASE BANK, N.A.
as Administrative Agent
Dated as of November 23, 2005
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TABLE OF CONTENTS
Page
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SECTION 1. DEFINED TERMS................................................. 1
1.1 Definitions...................................................... 1
1.2 Other Definitional Provisions.................................... 5
SECTION 2. GUARANTEE..................................................... 5
2.1 Guarantee........................................................ 5
2.2 Right of Contribution............................................ 6
2.3 No Subrogation................................................... 7
2.4 Amendments, etc. with respect to the Borrower Obligations........ 7
2.5 Guarantee Absolute and Unconditional............................. 7
2.6 Reinstatement.................................................... 8
2.7 Payments......................................................... 8
SECTION 3. GRANT OF SECURITY INTEREST.................................... 8
SECTION 4. REPRESENTATIONS AND WARRANTIES................................ 9
4.1 Representations in Credit Agreement.............................. 10
4.2 Title; No Other Liens............................................ 10
4.3 Jurisdiction of Organization; Chief Executive Office............. 10
4.4 Inventory and Equipment.......................................... 10
4.5 Farm Products.................................................... 10
4.6 Pledged Securities............................................... 10
4.7 Intellectual Property............................................ 11
4.8 Holdings Representations......................................... 11
SECTION 5. COVENANTS..................................................... 11
5.1 Covenants in Credit Agreement.................................... 11
5.2 Investment Property.............................................. 11
5.3 Activities of Holdings........................................... 11
SECTION 6. REMEDIAL PROVISIONS........................................... 12
6.1 Certain Matters Relating to Receivables.......................... 12
6.2 Communications with Obligors; Grantors Remain Liable............. 12
6.3 Pledged Securities............................................... 13
6.4 Proceeds to be Turned Over To Administrative Agent............... 13
6.5 Application of Proceeds.......................................... 14
6.6 Code and Other Remedies.......................................... 14
6.7 Private Sales.................................................... 15
6.8 Deficiency....................................................... 15
SECTION 7. THE ADMINISTRATIVE AGENT...................................... 15
7.1 Administrative Agent's Appointment as Attorney-in-Fact, etc...... 15
7.2 Duty of Administrative Agent..................................... 17
7.3 Execution of Financing Statements................................ 17
7.4 Authority of Administrative Agent................................ 17
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SECTION 8. MISCELLANEOUS................................................. 17
8.1 Amendments in Writing............................................ 17
8.2 Notices.......................................................... 17
8.3 No Waiver by Course of Conduct; Cumulative Remedies.............. 18
8.4 Enforcement Expenses; Indemnification............................ 18
8.5 Successors and Assigns........................................... 18
8.6 Set-Off.......................................................... 18
8.7 Counterparts..................................................... 18
8.8 Severability..................................................... 19
8.9 Section Headings................................................. 19
8.10 Integration...................................................... 19
8.11 GOVERNING LAW.................................................... 19
8.12 Submission To Jurisdiction; Waivers.............................. 19
8.13 Acknowledgements................................................. 19
8.14 Additional Grantors.............................................. 20
8.15 Releases......................................................... 20
8.16 WAIVER OF JURY TRIAL............................................. 20
SCHEDULES
Schedule 1 Notice Addresses
Schedule 2 Investment Property
Schedule 3 Perfection Matters
Schedule 4 Jurisdictions of Organization and Chief Executive Offices
Schedule 5 Inventory and Equipment Locations
Schedule 6 Intellectual Property
ANNEXES
Annex I Assumption Agreement
Annex II Acknowledgment and Consent
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GUARANTEE AND COLLATERAL AGREEMENT
GUARANTEE AND COLLATERAL AGREEMENT, dated as of November 23, 2005,
made by each of the signatories hereto, in favor of JPMorgan Chase Bank, N.A.,
as Administrative Agent (in such capacity, the "Administrative Agent") for the
banks and other financial institutions or entities (the "Lenders") from time to
time parties to the Credit Agreement, dated as of November 23, 2005 (as amended,
supplemented or otherwise modified from time to time, the "Credit Agreement"),
among Sunshine Acquisition II, Inc., a Delaware corporation (the "Initial US
Borrower"), SS&C Technologies, Inc., a Delaware corporation (the "Surviving US
Borrower"), SS&C Technologies Canada Corp., a Nova Scotia unlimited company (the
"CDN Borrower" and, together with the US Borrower (as defined below), the
"Borrowers"), the Lenders, the Administrative Agent, JPMorgan Chase Bank, N.A.,
Toronto Branch, as Canadian Administrative Agent, and the other parties named
therein.
WITNESSETH:
WHEREAS, pursuant to the Credit Agreement, the Lenders have severally
agreed to make extensions of credit to the Borrowers upon the terms and subject
to the conditions set forth therein;
WHEREAS, the Borrowers are members of an affiliated group of companies
that includes each other Grantor;
WHEREAS, the proceeds of the extensions of credit under the Credit
Agreement will be used in part to enable the Borrowers to make valuable
transfers to one or more of the other Grantors in connection with the operation
of their respective businesses;
WHEREAS, the Borrowers and the other Grantors are engaged in related
businesses, and each Grantor will derive substantial direct and indirect benefit
from the making of the extensions of credit under the Credit Agreement; and
WHEREAS, it is a condition precedent to the obligation of the Lenders
to make their respective extensions of credit to the Borrowers under the Credit
Agreement that the Grantors shall have executed and delivered this Agreement to
the Administrative Agent for the ratable benefit of the Lenders;
NOW, THEREFORE, in consideration of the premises and to induce the
Administrative Agent and the Lenders to enter into the Credit Agreement and to
induce the Lenders to make their respective extensions of credit to the
Borrowers thereunder, each Grantor hereby agrees with the Administrative Agent,
for the ratable benefit of the Lenders, as follows:
SECTION 1. DEFINED TERMS
1.1 Definitions. (a) Unless otherwise defined herein, terms defined in the
Credit Agreement and used herein shall have the meanings given to them in the
Credit Agreement, and the following terms are used herein as defined in the New
York UCC: Accounts, Certificated Security, Chattel Paper, Documents, Equipment,
Farm Products, General Intangibles, Instruments, Inventory, Letter-of-Credit
Rights and Supporting Obligations.
(b) The following terms shall have the following meanings:
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"Agreement": this Guarantee and Collateral Agreement, as the same may
be amended, supplemented or otherwise modified from time to time.
"Borrower Cash Management Obligations": to the extent that the
relevant Borrower so agrees in the applicable agreements therefor, the
collective reference to all obligations and liabilities of each Borrower and its
Subsidiaries (including, to the extent that such agreements so provide and
without limitation, interest accruing at the then applicable rate provided in
the Specified Cash Management Arrangement after the filing of any petition in
bankruptcy, or the commencement of any insolvency, reorganization or like
proceeding, relating to either Borrower, whether or not a claim for post-filing
or post-petition interest is allowed in such proceeding) to any Lender or any
affiliate of any Lender (or any Lender or any affiliate thereof at the time such
Specified Cash Management Arrangement was entered into), whether direct or
indirect, absolute or contingent, due or to become due, or now existing or
hereafter incurred, which may arise under, out of, or in connection with, any
Specified Cash Management Arrangement or any other document made, delivered or
given in connection therewith, in each case whether on account of principal,
interest, reimbursement obligations, fees, indemnities, costs, expenses or
otherwise (including, to the extent that such agreements so provide and without
limitation, all fees and disbursements of counsel to the relevant Lender or
affiliate thereof that are required to be paid by either Borrower pursuant to
the terms of any Specified Cash Management Arrangement).
"Borrower Credit Agreement Obligations": the collective reference to
the unpaid principal of and interest on the Loans, the Reimbursement
Obligations, the full Face Amount of all outstanding B/As and all other
obligations and liabilities of each Borrower (including, without limitation,
interest accruing at the then applicable rate provided in the Credit Agreement
after the maturity of the Loans and Reimbursement Obligations and interest
accruing at the then applicable rate provided in the Credit Agreement after the
filing of any petition in bankruptcy, or the commencement of any insolvency,
reorganization or like proceeding, relating to either Borrower, whether or not a
claim for post-filing or post-petition interest is allowed in such proceeding)
to the Administrative Agent, the Canadian Administrative Agent or any Lender,
whether direct or indirect, absolute or contingent, due or to become due, or now
existing or hereafter incurred, which may arise under, out of, or in connection
with, the Credit Agreement, this Agreement, the other Loan Documents, any Letter
of Credit, any B/A or any other document made, delivered or given in connection
therewith, in each case whether on account of principal, interest, reimbursement
obligations, fees, indemnities, costs, expenses or otherwise (including, without
limitation, all fees and disbursements of counsel to the Administrative Agent,
to the Canadian Administrative Agent or to the Lenders that are required to be
paid by either Borrower pursuant to the terms of any of the foregoing
agreements).
"Borrower Hedge Agreement Obligations": the collective reference to
all obligations and liabilities of each Borrower and its Subsidiaries
(including, without limitation, interest accruing at the then applicable rate
provided in any Specified Hedge Agreement after the filing of any petition in
bankruptcy, or the commencement of any insolvency, reorganization or like
proceeding, relating to either Borrower, whether or not a claim for post-filing
or post-petition interest is allowed in such proceeding) to any Lender or any
affiliate of any Lender (or any Lender or any affiliate thereof at the time such
Specified Hedge Agreement was entered into), whether direct or indirect,
absolute or contingent, due or to become due, or now existing or hereafter
incurred, which may arise under, out of, or in connection with, any Specified
Hedge Agreement or any other document made, delivered or given in connection
therewith, in each case whether on account of principal, interest, reimbursement
obligations, fees, indemnities, costs, expenses or otherwise (including, without
limitation, all fees and disbursements of counsel to the relevant Lender or
affiliate thereof that are required to be paid by either Borrower pursuant to
the terms of any Specified Hedge Agreement).
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"Borrower Obligations": the collective reference to (i) the Borrower
Credit Agreement Obligations, (ii) the Borrower Hedge Agreement Obligations, but
only to the extent that, and only so long as, the Borrower Credit Agreement
Obligations are secured and guaranteed pursuant hereto, and (iii) the Borrower
Cash Management Obligations, but only to the extent that, and only so long as,
the Borrower Credit Agreement Obligations are secured and guaranteed pursuant
hereto.
"Collateral": as defined in Section 3.
"Collateral Account": any collateral account established by the
Administrative Agent as provided in Section 6.1 or 6.4.
"Copyright Licenses": all written agreements naming any Grantor as
licensor or licensee (including, without limitation, those listed in Schedule
6), granting any right under any Copyright, including, without limitation, the
grant of rights to manufacture, distribute, exploit and sell materials derived
from any Copyright.
"Copyrights": (i) all copyrights arising under the laws of the United
States, whether registered or unregistered and whether published or unpublished
(including, without limitation, those listed in Schedule 6), all registrations
and recordings thereof, and all applications in connection therewith, including,
without limitation, all registrations, recordings and applications in the United
States Copyright Office, and (ii) the right to obtain all renewals thereof.
"Deposit Account": as defined in the Uniform Commercial Code of any
applicable jurisdiction and, in any event, including, without limitation, any
demand, time, savings, passbook or like account maintained with a depositary
institution.
"Foreign Subsidiary Voting Stock": the voting Capital Stock of any
Foreign Subsidiary.
"Grantors": the collective reference to each signatory hereto together
with any other entity that may become a party hereto as provided herein.
"Guarantor Obligations": with respect to any Guarantor, all
obligations and liabilities of such Guarantor which may arise under or in
connection with this Agreement (including, without limitation, Section 2) or any
other Loan Document to which such Guarantor is a party, in each case whether on
account of guarantee obligations, reimbursement obligations, fees, indemnities,
costs, expenses or otherwise (including, without limitation, all fees and
disbursements of counsel to the Administrative Agent, to the Canadian
Administrative Agent or to the Lenders that are required to be paid by such
Guarantor pursuant to the terms of this Agreement or any other Loan Document).
"Guarantors": the collective reference to (i) each signatory hereto
together with any other entity that may become a party hereto as provided herein
other than the US Borrower and (ii) in respect of the Borrower Obligations of
the CDN Borrower only, the US Borrower.
"Intellectual Property": the collective reference to all rights,
priorities and privileges relating to intellectual property, whether arising
under United States, multinational or foreign laws or otherwise, now existing or
hereafter adopted or acquired, including, without limitation, the Copyrights,
the Copyright Licenses, the Patents, the Patent Licenses, the Trademarks and the
Trademark Licenses, and all rights to xxx at law or in equity for any
infringement or other impairment thereof, including the right to receive all
proceeds and damages therefrom.
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"Intercompany Note": any promissory note evidencing loans made by any
Grantor to Holdings or any of its Subsidiaries.
"Investment Property": the collective reference to (i) all "investment
property" as such term is defined in Section 9-102(a)(49) of the New York UCC
(other than any Foreign Subsidiary Voting Stock excluded from the definition of
"Pledged Stock") and (ii) whether or not constituting "investment property" as
so defined, all Pledged Securities.
"Issuers": the collective reference to each issuer of a Pledged
Security.
"New York UCC": the Uniform Commercial Code as from time to time in
effect in the State of New York.
"Obligations": (i) in the case of each Borrower, its Borrower
Obligations, and (ii) in the case of each Guarantor, its Guarantor Obligations.
"Patent License": all written agreements providing for the grant by or
to any Grantor of any right to manufacture, use or sell any invention covered in
whole or in part by a Patent, including, without limitation, any of the
foregoing referred to in Schedule 6.
"Patents": (i) all letters patent of the United States, all reissues
and extensions thereof, and all goodwill associated therewith, including,
without limitation, any of the foregoing referred to in Schedule 6, (ii) all
applications for letters patent of the United States, any other country or any
political subdivision thereof, and all continuations and continuations in part
thereof, including, without limitation, any of the foregoing referred to in
Schedule 6, and (iii) all rights to obtain any reissues or extensions of the
foregoing.
"Pledged Notes": all promissory notes listed on Schedule 2, all
Intercompany Notes at any time issued to any Grantor in excess of $1,000,000 (or
Intercompany Notes which, in the aggregate, are in excess of $1,000,000) and all
other promissory notes issued to or held by any Grantor in excess of $1,000,000
(other than promissory notes issued in connection with extensions of trade
credit by any Grantor in the ordinary course of business).
"Pledged NSULC Shares": all Pledged Stock of a Person that is a Nova
Scotia unlimited liability company, now owned or hereafter acquired by a
Grantor.
"Pledged Securities": the collective reference to the Pledged Notes
and the Pledged Stock.
"Pledged Stock": the shares of Capital Stock listed on Schedule 2,
together with any other shares, stock certificates, options, interests or rights
of any nature whatsoever in respect of the Capital Stock of any Person that may
be issued or granted to, or held by, any Grantor while this Agreement is in
effect; provided that in no event shall more than 65% of the total outstanding
Foreign Subsidiary Voting Stock of any Foreign Subsidiary be required to be
pledged hereunder.
"Proceeds": all "proceeds" as such term is defined in Section
9-102(a)(64) of the New York UCC and, in any event, shall include, without
limitation, all dividends or other income from the Investment Property,
collections thereon or distributions or payments with respect thereto.
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"Receivable": any right to payment for goods sold or leased or for
services rendered, whether or not such right is evidenced by an Instrument or
Chattel Paper and whether or not it has been earned by performance (including,
without limitation, any Account).
"Securities Act": the Securities Act of 1933, as amended.
"Specified Cash Management Arrangement": any cash management
arrangement (a) entered into by (i) the US Borrower or any of its Subsidiaries
and (ii) any Lender or any affiliate thereof at the time such cash management
arrangement was entered into, as counterparty, and (b) which has been designated
by such Lender and the US Borrower, by notice to the Administrative Agent not
later than 90 days after the execution and delivery by the US Borrower or its
Subsidiary thereof, as a Specified Cash Management Arrangement. The designation
of any cash management arrangement as a Specified Cash Management Arrangement
shall not create in favor of the Lender or affiliate thereof that is a party
thereto any rights in connection with the management or release of any
Collateral or any Guarantor Obligations.
"Trademark License": all written agreements providing for the grant by
or to any Grantor of any right to use any Trademark, including, without
limitation, any of the foregoing referred to in Schedule 6.
"Trademarks": (i) all trademarks, trade names, corporate names,
company names, business names, domain names, fictitious business names, trade
styles, service marks, logos and other source or business identifiers, and all
goodwill associated therewith, now existing or hereafter adopted or acquired,
all registrations and recordings thereof, and all applications in connection
therewith, whether in the United States Patent and Trademark Office or in any
similar office or agency of the United States, any State thereof, or otherwise,
and all common-law rights related thereto, including, without limitation, any of
the foregoing referred to in Schedule 6, and (ii) the right to obtain all
renewals thereof.
"US Borrower": (a) at any time prior to the consummation of the US
Merger Transactions, the Initial US Borrower, and (b) upon and at any time after
the consummation of the US Merger Transactions, the Surviving US Borrower.
"Vehicles": all cars, trucks, trailers, construction and earth moving
equipment and other vehicles covered by a certificate of title law of any state.
1.2 Other Definitional Provisions. (a) The words "hereof," "herein",
"hereto" and "hereunder" and words of similar import when used in this Agreement
shall refer to this Agreement as a whole and not to any particular provision of
this Agreement, and Section and Schedule references are to this Agreement unless
otherwise specified.
(b) The meanings given to terms defined herein shall be equally applicable
to both the singular and plural forms of such terms.
(c) Where the context requires, terms relating to the Collateral or any
part thereof, when used in relation to a Grantor, shall refer to such Grantor's
Collateral or the relevant part thereof.
SECTION 2. GUARANTEE
2.1 Guarantee. (a) (i) Each of the Guarantors (other than the US Borrower)
hereby, jointly and severally, unconditionally and irrevocably, guarantees to
the Administrative Agent, for the ratable benefit of the Administrative Agent,
the Canadian Administrative Agent, the Lenders and their respective successors,
indorsees, transferees and assigns, the prompt and complete payment and
performance by the
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Borrowers when due (whether at the stated maturity, by acceleration or
otherwise) of the Borrower Obligations.
(ii) The US Borrower hereby unconditionally and irrevocably guarantees
to the Administrative Agent, for the ratable benefit of the Administrative
Agent, the Canadian Administrative Agent, the Lenders and their respective
successors, indorsees, transferees and assigns, the prompt and complete payment
and performance by the CDN Borrower when due (whether at stated maturity, by
acceleration or otherwise) of the Borrower Obligations of the CDN Borrower.
(b) Anything herein or in any other Loan Document to the contrary
notwithstanding, the maximum liability of each Guarantor hereunder and under the
other Loan Documents shall in no event exceed the amount which can be guaranteed
by such Guarantor under applicable federal and state laws relating to the
insolvency of debtors (after giving effect to the right of contribution
established in Section 2.2).
(c) Each Guarantor agrees that the Borrower Obligations may at any time and
from time to time exceed the amount of the liability of such Guarantor hereunder
without impairing the guarantee contained in this Section 2 or affecting the
rights and remedies of the Administrative Agent, the Canadian Administrative
Agent or any Lender hereunder.
(d) The guarantee contained in this Section 2 shall remain in full force
and effect until all the Borrower Obligations and the obligations of each
Guarantor under the guarantee contained in this Section 2 shall have been
satisfied by payment in full (other than contingent or indemnification
obligations not then due), no Letter of Credit or B/A (that is not cash
collateralized to the reasonable satisfaction of the Issuing Bank or purchasing
Lender, as applicable, in respect thereof) shall be outstanding and the
Commitments shall have been terminated, notwithstanding that from time to time
during the term of the Credit Agreement the Borrowers or either of them may be
free from any Borrower Obligations.
(e) No payment (other than payment in full) made by either Borrower, any of
the Guarantors, any other guarantor or any other Person or received or collected
by the Administrative Agent, the Canadian Administrative Agent or any Lender
from either Borrower, any of the Guarantors, any other guarantor or any other
Person by virtue of any action or proceeding or any set-off or appropriation or
application at any time or from time to time in reduction of or in payment of
the Borrower Obligations shall be deemed to modify, reduce, release or otherwise
affect the liability of any Guarantor hereunder which shall, notwithstanding any
such payment (other than any payment made by such Guarantor in respect of the
Borrower Obligations or any payment received or collected from such Guarantor in
respect of the Borrower Obligations), remain liable for the Borrower Obligations
up to the maximum liability of such Guarantor hereunder until the Borrower
Obligations shall have been paid in full (other than contingent or
indemnification obligations not then due), no Letter of Credit or B/A (that is
not cash collateralized to the reasonable satisfaction of the Issuing Bank or
purchasing Lender, as applicable, in respect thereof) shall be outstanding and
the Commitments shall have been terminated.
2.2 Right of Contribution. Each Subsidiary Guarantor hereby agrees that to
the extent that a Subsidiary Guarantor shall have paid more than its
proportionate share of any payment made hereunder, such Subsidiary Guarantor
shall be entitled to seek and receive contribution from and against any other
Subsidiary Guarantor hereunder which has not paid its proportionate share of
such payment. Each Subsidiary Guarantor's right of contribution shall be subject
to the terms and conditions of Section 2.3. The provisions of this Section 2.2
shall in no respect limit the obligations and liabilities of any Subsidiary
Guarantor to the Administrative Agent, the Canadian Administrative Agent and the
Lenders, and each Subsidiary Guarantor shall remain liable to the Administrative
Agent, the Canadian Administrative Agent and the Lenders for the full amount
guaranteed by such Subsidiary Guarantor hereunder.
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2.3 No Subrogation. Notwithstanding any payment made by any Guarantor
hereunder or any set-off or application of funds of any Guarantor by the
Administrative Agent, the Canadian Administrative Agent or any Lender, no
Guarantor shall be entitled to be subrogated to any of the rights of the
Administrative Agent, the Canadian Administrative Agent or any Lender against
either Borrower or any other Guarantor or any collateral security or guarantee
or right of offset held by the Administrative Agent, the Canadian Administrative
Agent or any Lender for the payment of the Borrower Obligations, nor shall any
Guarantor seek or be entitled to seek any contribution or reimbursement from
either Borrower or any other Guarantor in respect of payments made by such
Guarantor hereunder, until all amounts owing to the Administrative Agent, the
Canadian Administrative Agent and the Lenders by the Borrowers on account of the
Borrower Obligations shall have been paid in full (other than contingent or
indemnification obligations not then due), no Letter of Credit or B/A (that is
not cash collateralized to the reasonable satisfaction of the Issuing Bank or
purchasing Lender, as applicable, in respect thereof) shall be outstanding and
the Commitments shall have been terminated. If any amount shall be paid to any
Guarantor on account of such subrogation rights at any time when all of such
Borrower Obligations shall not have been paid in full, such amount shall be held
by such Guarantor in trust for the Administrative Agent, the Canadian
Administrative Agent and the Lenders, segregated from other funds of such
Guarantor, and shall, forthwith upon receipt by such Guarantor, be turned over
to the Administrative Agent in the exact form received by such Guarantor (duly
indorsed by such Guarantor to the Administrative Agent, if required), to be
applied against the Borrower Obligations, whether matured or unmatured, in such
order as the Administrative Agent may determine.
2.4 Amendments, etc. with respect to the Borrower Obligations. Each
Guarantor shall remain obligated hereunder notwithstanding that, without any
reservation of rights against any Guarantor and without notice to or further
assent by any Guarantor, any demand for payment of any of the Borrower
Obligations made by the Administrative Agent, the Canadian Administrative Agent
or any Lender may be rescinded by the Administrative Agent, the Canadian
Administrative Agent or such Lender and any of the Borrower Obligations
continued, and the Borrower Obligations, or the liability of any other Person
upon or for any part thereof, or any collateral security or guarantee therefor
or right of offset with respect thereto, may, from time to time, in whole or in
part, be renewed, extended, amended, modified, accelerated, compromised, waived,
surrendered or released by the Administrative Agent, the Canadian Administrative
Agent or any Lender, and the Credit Agreement and the other Loan Documents and
any other documents executed and delivered in connection therewith may be
amended, modified, supplemented or terminated, in whole or in part, as the
Administrative Agent (or the Required Lenders or all Lenders, as the case may
be) may deem advisable from time to time, and any collateral security, guarantee
or right of offset at any time held by the Administrative Agent, the Canadian
Administrative Agent or any Lender for the payment of the Borrower Obligations
may be sold, exchanged, waived, surrendered or released. Neither the
Administrative Agent, the Canadian Administrative Agent nor any Lender shall
have any obligation to protect, secure, perfect or insure any Lien at any time
held by it as security for the Borrower Obligations or for the guarantee
contained in this Section 2 or any property subject thereto.
2.5 Guarantee Absolute and Unconditional. Each Guarantor waives any and all
notice of the creation, renewal, extension or accrual of any of the Borrower
Obligations and notice of or proof of reliance by the Administrative Agent, the
Canadian Administrative Agent or any Lender upon the guarantee contained in this
Section 2 or acceptance of the guarantee contained in this Section 2; the
Borrower Obligations, and any of them, shall conclusively be deemed to have been
created, contracted or incurred, or renewed, extended, amended or waived, in
reliance upon the guarantee contained in this Section 2; and all dealings
between the Borrowers and any of the Guarantors, on the one hand, with respect
to the Loan Documents and the Administrative Agent, the Canadian Administrative
Agent and the Lenders, on the other hand, likewise shall be conclusively
presumed to have been had or consummated in reliance upon the guarantee
contained in this Section 2. Each Guarantor waives diligence, presentment,
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protest, demand for payment and notice of default or nonpayment to or upon
either Borrower or any of the Guarantors with respect to the Borrower
Obligations. Each Guarantor understands and agrees that the guarantee contained
in this Section 2 shall be construed as a continuing, absolute and unconditional
guarantee of payment without regard to (a) the validity or enforceability of the
Credit Agreement or any other Loan Document, any of the Borrower Obligations or
any other collateral security therefor or guarantee or right of offset with
respect thereto at any time or from time to time held by the Administrative
Agent or any Lender, (b) any defense, set-off or counterclaim (other than a
defense of payment or performance) which may at any time be available to or be
asserted by either Borrower or any other Person against the Administrative
Agent, the Canadian Administrative Agent or any Lender, or (c) any other
circumstance whatsoever (other than a defense of payment or performance) (with
or without notice to or knowledge of either Borrower or any Guarantor) which
constitutes, or might be construed to constitute, an equitable or legal
discharge of such Borrower for the Borrower Obligations, or of such Guarantor
under the guarantee contained in this Section 2, in bankruptcy or in any other
instance. When making any demand hereunder or otherwise pursuing its rights and
remedies hereunder against any Guarantor, the Administrative Agent, the Canadian
Administrative Agent or any Lender may, but shall be under no obligation to,
make a similar demand on or otherwise pursue such rights and remedies as it may
have against either Borrower, any other Guarantor or any other Person or against
any collateral security or guarantee for the Borrower Obligations or any right
of offset with respect thereto, and any failure by the Administrative Agent, the
Canadian Administrative Agent or any Lender to make any such demand, to pursue
such other rights or remedies or to collect any payments from either Borrower,
any other Guarantor or any other Person or to realize upon any such collateral
security or guarantee or to exercise any such right of offset, or any release of
either Borrower, any other Guarantor or any other Person or any such collateral
security, guarantee or right of offset, shall not relieve any Guarantor of any
obligation or liability hereunder, and shall not impair or affect the rights and
remedies, whether express, implied or available as a matter of law, of the
Administrative Agent, the Canadian Administrative Agent or any Lender against
any Guarantor. For the purposes hereof "demand" shall include the commencement
and continuance of any legal proceedings.
2.6 Reinstatement. The guarantee contained in this Section 2 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 the Borrower Obligations is rescinded or must
otherwise be restored or returned by the Administrative Agent, the Canadian
Administrative Agent or any Lender upon the insolvency, bankruptcy, dissolution,
liquidation or reorganization of either Borrower or any Guarantor, or upon or as
a result of the appointment of a receiver, intervenor or conservator of, or
trustee or similar officer for, either Borrower or any Guarantor or any
substantial part of its property, or otherwise, all as though such payments had
not been made.
2.7 Payments. Each Guarantor hereby guarantees that payments hereunder will
be paid to the Administrative Agent without set-off or counterclaim in Dollars
or CDN Dollars, as applicable, at the US Funding Office or CDN Funding Office,
as applicable.
SECTION 3. GRANT OF SECURITY INTEREST
Each Grantor hereby grants to the Administrative Agent, for the
ratable benefit of the Administrative Agent, the Canadian Administrative Agent
and the Lenders (and any affiliates of any Lender to which Borrower Hedge
Agreement Obligations or Borrower Cash Management Obligations are owing), a
security interest in all of the following property 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
"Collateral"), as collateral security for the prompt and complete payment and
performance when due (whether at the stated maturity, by acceleration or
otherwise) of such Grantor's Obligations:
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(a) all Accounts;
(b) all Chattel Paper;
(c) all Documents;
(d) all Equipment;
(e) all General Intangibles;
(f) all Instruments;
(g) all Intellectual Property;
(h) all Inventory;
(i) all Investment Property;
(j) all Letter-of-Credit Rights;
(k) all other personal property not otherwise described above;
(l) all books and records pertaining to the Collateral; and
(m) to the extent not otherwise included, all Proceeds, Supporting
Obligations 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;
provided, however, that notwithstanding any of the other provisions
set forth in this Section 3, this Agreement shall not constitute a grant of a
security interest in (i) any leasehold interest in real property, (ii) any
Vehicles or Deposit Accounts (without prejudice to any amounts therein which are
Proceeds of the Collateral) and all Proceeds thereof, (iii) any property to the
extent that such grant of a security interest is prohibited by any Requirements
of Law of a Governmental Authority, requires a consent not obtained of any
Governmental Authority pursuant to such Requirement of Law or is prohibited by,
or constitutes a breach or default under or results in the termination of or
requires any consent not obtained under, any contract, license, agreement,
instrument or other document evidencing or giving rise to such property or, in
the case of any Investment Property, Pledged Stock or Pledged Note, any
applicable shareholder or similar agreement, except to the extent that such
Requirement of Law or the term in such contract, license, agreement, instrument
or other document or shareholder or similar agreement providing for such
prohibition, breach, default or termination or requiring such consent is
ineffective under applicable law and (iv) property of Holdings acquired after
the date hereof, other than Proceeds of the Collateral granted by Holdings as of
the date hereof or additional Investment Property consisting of Capital Stock of
the US Borrower. It is hereby understood and agreed that any Property described
in the preceding proviso, and any Property that is otherwise expressly excluded
from clauses (a) through (m) above, shall be excluded from the definition of
"Collateral".
SECTION 4. REPRESENTATIONS AND WARRANTIES
To induce the Administrative Agent, the Canadian Administrative Agent
and the Lenders to enter into the Credit Agreement and to induce the Lenders to
make their respective extensions of credit
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to the Borrowers thereunder, each Guarantor and each Grantor hereby represents
and warrants to the Administrative Agent, the Canadian Administrative Agent and
each Lender that:
4.1 Representations in Credit Agreement. In the case of each Guarantor, the
representations and warranties set forth in Section 4 of the Credit Agreement as
they relate to such Guarantor or to the Loan Documents to which such Guarantor
is a party, each of which is hereby incorporated herein by reference, are true
and correct, and the Administrative Agent, the Canadian Administrative Agent and
each Lender shall be entitled to rely on each of them as if they were fully set
forth herein, provided, that each reference in each such representation and
warranty to either Borrower's knowledge shall, for the purposes of this Section
4.1, be deemed to be a reference to such Guarantor's knowledge.
4.2 Title; No Other Liens. Except for the security interest granted to the
Administrative Agent pursuant to this Agreement and the other Liens permitted to
exist on the Collateral by the Credit Agreement, such Grantor owns or has rights
in each item of the Collateral free and clear of any and all Liens or claims of
others. No financing statement or other public notice with respect to all or any
part of the Collateral is on file or of record in any public office, except (i)
such as have been filed in favor of the Administrative Agent, for the ratable
benefit of the Administrative Agent, the Canadian Administrative Agent and the
Lenders, pursuant to this Agreement, (ii) as are permitted by the Credit
Agreement or (iii) financing statements that have been filed without the consent
of any Grantor. For the avoidance of doubt, it is understood and agreed that any
Grantor may, as part of its business, grant licenses to third parties to use
Intellectual Property owned, licensed or developed by a Grantor. For purposes of
this Agreement and the other Loan Documents, such licensing activity shall not
constitute a "Lien" on such Intellectual Property. Each of the Administrative
Agent, the Canadian Administrative Agent and each Lender understands that any
such licenses may be exclusive to the applicable licensees, and such exclusivity
provisions may limit the ability of the Administrative Agent to utilize, sell,
lease or transfer the related Intellectual Property or otherwise realize value
from such Intellectual Property pursuant hereto.
4.3 Jurisdiction of Organization; Chief Executive Office. On the date
hereof, such Grantor's jurisdiction of organization, identification number from
the jurisdiction of organization (if any), and the location of such Grantor's
chief executive office are specified on Schedule 4.
4.4 Inventory and Equipment. On the date hereof, the Inventory and the
Equipment (other than mobile goods) in excess of $500,000 are kept at the
locations listed on Schedule 5.
4.5 Farm Products. On the date hereof, none of the Collateral constitutes,
or is the Proceeds of, Farm Products.
4.6 Pledged Securities. On the date hereof, the shares of Pledged Stock
pledged by such Grantor hereunder:
(a) with respect to the shares of Pledged Stock issued by the Borrower and
its Subsidiaries, have been duly authorized, validly issued and are fully paid
and non-assessable, to the extent such concepts are applicable; and
(b) constitute all the issued and outstanding shares of all classes of the
Capital Stock of each Issuer owned by such Grantor or, in the case of Foreign
Subsidiary Voting Stock, 65% of the outstanding Foreign Subsidiary Voting Stock
of each relevant Issuer.
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4.7 Intellectual Property.
(a) Schedule 6 lists all material Intellectual Property owned by such
Grantor in its own name on the date hereof.
(b) Except as set forth in Schedule 6, on the date hereof, none of the
Intellectual Property is the subject of any licensing or franchise agreement
pursuant to which such Grantor is the licensor or franchisor.
4.8 Holdings Representations. In the case of Holdings:
(a) Holdings (i) is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its organization, (ii) has the corporate
or other organizational power and authority, and the legal right, to own and
operate its Property, to lease the Property it operates as lessee and to conduct
the business in which it is currently engaged, (iii) is duly qualified as a
foreign corporation or other entity and in good standing under the laws of each
jurisdiction where its ownership, lease or operation of property or the conduct
of its business requires such qualification except to the extent that the
failure to be so qualified or in good standing would not have a Material Adverse
Effect and (iv) is in compliance with all Requirements of Law except to the
extent that the failure to comply therewith could not reasonably be expected to
have a Material Adverse Effect.
(b) No litigation, investigation or proceeding of or before any arbitrator
or Governmental Authority is pending against Holdings or any of its Subsidiaries
or against any of its or their respective properties or revenues which, taken as
a whole, (x) are material with respect to any of the Loan Documents or (y) would
reasonably be expected to have a Material Adverse Effect.
SECTION 5. COVENANTS
Each Guarantor and each Grantor covenants and agrees with the
Administrative Agent, the Canadian Administrative Agent and the Lenders that,
from and after the date of this Agreement until the Obligations shall have been
paid in full, no Letter of Credit or B/A shall be outstanding and the
Commitments shall have been terminated:
5.1 Covenants in Credit Agreement. In the case of each Guarantor, such
Guarantor shall take, or shall refrain from taking, as the case may be, each
action that is necessary to be taken or not taken, as the case may be, so that
no Default or Event of Default is caused by the failure to take such action or
to refrain from taking such action by such Guarantor or any of its Subsidiaries.
5.2 Investment Property. In the case of each Grantor which is an Issuer,
such Issuer agrees that (a) it will be bound by the terms of this Agreement
relating to the Pledged Securities issued by it and will comply with such terms
insofar as such terms are applicable to it and (b) the terms of Sections 6.3(c)
and 6.7 shall apply to it, mutatis mutandis, with respect to all actions that
may be required of it pursuant to Section 6.3(c) or 6.7 with respect to the
Pledged Securities issued by it.
5.3 Activities of Holdings. In the case of Holdings, Holdings shall not (a)
conduct, transact or otherwise engage in any business or operations other than
(i) its ownership of the Capital Stock of the US Borrower, (ii) the issuance of
and performance of its obligations in respect of its Capital Stock and
Indebtedness, (iii) the payment of dividends and taxes, (iv) transactions
contemplated by Section 7.6 of the Credit Agreement, (v) performance of its
obligations hereunder and under the other Loan Documents and the other
agreements contemplated thereby, (vi) actions required by law to maintain its
existence and (vii) activities incidental to its maintenance and continuance and
to any of the foregoing activities, (b)
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incur, create, assume or suffer to exist any Lien on the Capital Stock of the US
Borrower (other than non-consensual Liens arising by operation of law and any
Liens for taxes not yet due or which are being contested in good faith by
appropriate proceedings, so long as adequate reserves with respect thereto are
maintained on the books of Holdings to the extent required by GAAP), or (d) own,
lease, manage or otherwise operate (other than through ownership of the US
Borrower) any properties or assets, other than (i) cash and Cash Equivalents and
deposit and securities accounts comprised of cash and cash equivalents, (ii) the
ownership of shares of Capital Stock of the US Borrower and (iii) other assets,
not material in amount, incidental to the operations of Holdings as the holding
company of the US Borrower.
SECTION 6. REMEDIAL PROVISIONS
6.1 Certain Matters Relating to Receivables. (a) At any time during the
continuance of an Event of Default, upon the Administrative Agent's reasonable
request at the expense of the relevant Grantor, such Grantor shall cause
independent public accountants or others satisfactory to the Administrative
Agent to furnish to the Administrative Agent reports showing reconciliations,
aging and test verifications of, and trial balances for, the Receivables.
(b) If required by the Administrative Agent at any time after the
occurrence and during the continuance of an Event of Default under Section 8(a)
or 8(f) of the Credit Agreement, any payments of Receivables, when collected by
any Grantor, (i) shall be forthwith (and, in any event, within two Business
Days) deposited by such Grantor in the exact form received, duly indorsed by
such Grantor to the Administrative Agent if required, in a Collateral Account
maintained under the sole dominion and control of the Administrative Agent,
subject to withdrawal by the Administrative Agent for the account of the
Administrative Agent, the Canadian Administrative Agent and the Lenders only as
provided in Section 6.5, and (ii) until so turned over, shall be held by such
Grantor in trust for the Administrative Agent, the Canadian Administrative Agent
and the Lenders, segregated from other funds of such Grantor. Each such deposit
of Proceeds of Receivables shall be accompanied by a report identifying in
reasonable detail the nature and source of the payments included in the deposit.
(c) If an Event of Default has occurred and is continuing and at the
Administrative Agent's request, each Grantor shall deliver to the Administrative
Agent all documents evidencing, and relating to, the agreements and transactions
which gave rise to the Receivables, including, without limitation, all orders,
invoices and shipping receipts.
6.2 Communications with Obligors; Grantors Remain Liable. (a) Upon the
request of the Administrative Agent at any time after the occurrence and during
the continuance of an Event of Default under Section 8(a) or 8(f) of the Credit
Agreement, each Grantor shall notify obligors on the Receivables that the
Receivables have been assigned to the Administrative Agent for the ratable
benefit of the Administrative Agent, the Canadian Administrative Agent and the
Lenders and that payments in respect thereof shall be made directly to the
Administrative Agent.
(b) Anything herein to the contrary notwithstanding, each Grantor shall
remain liable under the Receivables to observe and perform all the conditions
and obligations to be observed and performed by it thereunder, all in accordance
with the terms of any agreement giving rise thereto. Neither the Administrative
Agent, the Canadian Administrative Agent nor any Lender shall have any
obligation or liability under any Receivable (or any agreement giving rise
thereto) by reason of or arising out of this Agreement or the receipt by the
Administrative Agent, the Canadian Administrative Agent or any Lender of any
payment relating thereto, nor shall the Administrative Agent, the Canadian
Administrative Agent or any Lender be obligated in any manner to perform any of
the obligations of any Grantor under or pursuant to any Receivable (or any
agreement giving rise thereto), to make any payment, to make any inquiry as to
the nature or the sufficiency of any payment received by it or as to the
sufficiency of any
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performance by any party thereunder, to present or file any claim, to take any
action to enforce any performance or to collect the payment of any amounts which
may have been assigned to it or to which it may be entitled at any time or
times.
6.3 Pledged Securities. (a) Unless an Event of Default shall have occurred
and be continuing and the Administrative Agent shall have given notice to the
relevant Grantor of the Administrative Agent's intent to exercise its
corresponding rights pursuant to Section 6.3(b), each Grantor shall be permitted
to receive all cash dividends paid in respect of the Pledged Stock and all
payments made in respect of the Pledged Notes to the extent permitted in the
Credit Agreement, and to exercise all voting and corporate rights with respect
to the Pledged Securities.
(b) If an Event of Default shall occur and be continuing and the
Administrative Agent shall give notice of its intent to exercise such rights to
the relevant Grantor or Grantors, (i) unless otherwise provided in the Credit
Agreement, the Administrative Agent shall have the right to receive any and all
cash dividends, payments or other Proceeds paid in respect of the Pledged
Securities and make application thereof to the Obligations in the order set
forth in Section 6.5, and (ii) any or all of the Pledged Securities shall be
registered in the name of the Administrative Agent or its nominee, and the
Administrative Agent or its nominee may thereafter exercise (x) all voting,
corporate and other rights pertaining to such Pledged Securities at any meeting
of shareholders of the relevant Issuer or Issuers or otherwise and (y) any and
all rights of conversion, exchange and subscription and any other rights,
privileges or options pertaining to such Pledged Securities as if it were the
absolute owner thereof (including, without limitation, the right to exchange at
its discretion any and all of the Pledged Securities upon the merger,
consolidation, reorganization, recapitalization or other fundamental change in
the corporate structure of any Issuer, or upon the exercise by any Grantor or
the Administrative Agent of any right, privilege or option pertaining to such
Pledged Securities, and in connection therewith, the right to deposit and
deliver any and all of the Pledged Securities with any committee, depositary,
transfer agent, registrar or other designated agency upon such terms and
conditions as the Administrative Agent may determine), all without liability
except to account for property actually received by it, but the Administrative
Agent shall have no duty to any Grantor to exercise any such right, privilege or
option and shall not be responsible for any failure to do so or delay in so
doing unless the Administrative Agent has given notice of its intent to exercise
as set forth above.
(c) Each Grantor hereby authorizes and instructs each Issuer of any Pledged
Securities pledged by such Grantor hereunder to comply with any instruction
received by it from the Administrative Agent in writing that (x) states that an
Event of Default has occurred and is continuing and (y) is otherwise in
accordance with the terms of this Agreement, without any other or further
instructions from such Grantor, and each Grantor agrees that each Issuer shall
be fully protected in so complying.
(d) Notwithstanding any other provision of this Agreement, none of the
rights and remedies granted by a Grantor to the Administrative Agent herein in
respect of any Pledged NSULC Shares (other than the grant of the security
interest) shall be exercisable or otherwise vest in the Administrative Agent,
the Canadian Administrative Agent or any Lender hereunder and such Grantor shall
remain the legal and beneficial owner of such Pledged NSULC Shares and shall
retain all of the incidents of such ownership until (i) an Event of Default has
occurred and (ii) the Administrative Agent has given notice to such Grantor of
such Event of Default and its intention to exercise such rights and remedies in
respect of such Pledged NSULC Shares. Nothing herein shall be construed to
subject the Administrative Agent or any Lender hereunder to liability as a
member or owner of shares of a Nova Scotia unlimited company.
6.4 Proceeds to be Turned Over To Administrative Agent. In addition to the
rights of the Administrative Agent, the Canadian Administrative Agent and the
Lenders specified in Section 6.1 with respect to payments of Receivables, if an
Event of Default shall occur and be continuing and the Loans
14
shall have been accelerated pursuant to Section 8 of the Credit Agreement, all
Proceeds received by any Grantor consisting of cash, checks and other near-cash
items shall be held by such Grantor in trust for the Administrative Agent, the
Canadian Administrative Agent and the Lenders, segregated from other funds of
such Grantor, and shall, promptly upon receipt by such Grantor, be turned over
to the Administrative Agent in the exact form received by such Grantor (duly
indorsed by such Grantor to the Administrative Agent, if required). All Proceeds
received by the Administrative Agent hereunder shall be held by the
Administrative Agent in a Collateral Account maintained under its sole dominion
and control. All Proceeds while held by the Administrative Agent in a Collateral
Account (or by such Grantor in trust for the Administrative Agent, the Canadian
Administrative Agent and the Lenders) shall continue to be held as collateral
security for all the Obligations and shall not constitute payment thereof until
applied as provided in Section 6.5.
6.5 Application of Proceeds. If an Event of Default shall have occurred and
be continuing and the Loans shall have been accelerated pursuant to Section 8 of
the Credit Agreement, at any time at the Administrative Agent's election, the
Administrative Agent may apply all or any part of Proceeds constituting
Collateral and any proceeds of the guarantee set forth in Section 2, in payment
of the Obligations, and shall make any such application in the following order:
First, to pay incurred and unpaid reasonable, out-of-pocket fees and
expenses of the Administrative Agent and the Canadian Administrative Agent
under the Loan Documents;
Second, to the Administrative Agent, for application by it towards
payment of amounts then due and owing and remaining unpaid in respect of
the Obligations, pro rata among the Administrative Agent, the Canadian
Administrative Agent and the Lenders (and any affiliates thereof which are
party to any Specified Hedge Agreement) according to the amounts of the
Obligations then due and owing and remaining unpaid to each of them; and
Third, any balance of such Proceeds remaining after the Obligations
shall have been paid in full (other than contingent or indemnification
obligations not then due), no Letter of Credit or B/A (that is not cash
collateralized to the reasonable satisfaction of the Issuing Bank or
purchasing Lender, as applicable, in respect thereof) shall be outstanding
and the Commitments shall have been terminated shall be paid over to the
Borrowers or to whomsoever may be lawfully entitled to receive the same.
6.6 Code and Other Remedies. If an Event of Default shall occur and be
continuing, the Administrative Agent, on behalf of itself, the Canadian
Administrative Agent and the Lenders, may exercise, in addition to all other
rights and remedies granted to them in this Agreement and in any other
instrument or agreement securing, evidencing or relating to the Obligations, all
rights and remedies of a secured party under the New York UCC or any other
applicable law. Without limiting the generality of the foregoing, the
Administrative Agent, without demand of performance or other demand,
presentment, protest, advertisement or notice of any kind (except any notice
required by law referred to below or notices otherwise provided in the Loan
Documents) to or upon any Grantor or any other Person (all and each of which
demands, defenses, advertisements and notices are hereby waived unless otherwise
provided in the Loan Documents), may in such circumstances forthwith collect,
receive, appropriate and realize upon the Collateral, or any part thereof,
and/or may forthwith sell, lease, assign, give option or options to purchase, or
otherwise dispose of and deliver the Collateral or any part thereof (or contract
to do any of the foregoing), in one or more parcels at public or private sale or
sales, at any exchange, broker's board or office of the Administrative Agent,
the Canadian Administrative Agent or any Lender or elsewhere upon such terms and
conditions as it may deem advisable and at such prices as it may deem best, for
cash or on credit or for future delivery without assumption of any credit risk.
The Administrative Agent, the Canadian Administrative Agent or any Lender shall
have the right upon any such public sale or
15
sales, and, to the extent permitted by law, upon any such private sale or sales,
to purchase the whole or any part of the Collateral so sold, free of any right
or equity of redemption in any Grantor, which right or equity is hereby waived
and released. Each Grantor further agrees, at the Administrative Agent's
request, to assemble the Collateral and make it available to the Administrative
Agent at places which the Administrative Agent shall reasonably select, whether
at such Grantor's premises or elsewhere. The Administrative Agent shall apply
the net proceeds of any action taken by it pursuant to this Section 6.6, after
deducting all reasonable costs and expenses of every kind actually incurred in
connection therewith or incidental to the care or safekeeping of any of the
Collateral or in any way relating to the Collateral or the rights of the
Administrative Agent, the Canadian Administrative Agent and the Lenders
hereunder, including, without limitation, reasonable attorneys' fees and
disbursements, to the payment in whole or in part of the Obligations, in such
order as the Administrative Agent may elect, and only after such application and
after the payment by the Administrative Agent of any other amount required by
any provision of law, including, without limitation, Section 9-615(a)(3) of the
New York UCC, need the Administrative Agent account for the surplus, if any, to
any Grantor. If any notice of a proposed sale or other disposition of Collateral
shall be required by law, such notice shall be deemed reasonable and proper if
given at least 10 days before such sale or other disposition.
6.7 Private Sales. Each Grantor recognizes that the Administrative Agent
may be unable to effect a public sale of any or all the Pledged Stock, by reason
of certain prohibitions contained in the Securities Act and applicable state
securities laws or otherwise, and may be compelled to resort to one or more
private sales thereof to a restricted group of purchasers which will be obliged
to agree, among other things, to acquire such securities for their own account
for investment and not with a view to the distribution or resale thereof. Each
Grantor acknowledges and agrees that any such private sale may result in prices
and other terms less favorable than if such sale were a public sale and,
notwithstanding such circumstances, agrees that any such private sale shall be
deemed to have been made in a commercially reasonable manner. The Administrative
Agent shall be under no obligation to delay a sale of any of the Pledged Stock
for the period of time necessary to permit the Issuer thereof to register such
securities for public sale under the Securities Act, or under applicable state
securities laws, even if such Issuer would agree to do so.
6.8 Deficiency. Each Grantor shall remain liable for any deficiency if the
proceeds of any sale or other disposition of the Collateral are insufficient to
pay its Obligations and the reasonable fees and disbursements of any attorneys
employed by the Administrative Agent to collect such deficiency.
SECTION 7. THE ADMINISTRATIVE AGENT
7.1 Administrative Agent's Appointment as Attorney-in-Fact, etc. (a) Each
Grantor hereby irrevocably constitutes and appoints the Administrative Agent and
any officer or agent thereof, with full power of substitution, as its true and
lawful attorney-in-fact with full irrevocable power and authority in the place
and stead of such Grantor and in the name of such Grantor or in its own name,
for the purpose of carrying out the terms of this Agreement, to take any and all
appropriate action and to execute any and all documents and instruments which
may be necessary or desirable to accomplish the purposes of this Agreement, and,
without limiting the generality of the foregoing, each Grantor hereby gives the
Administrative Agent the power and right, on behalf of such Grantor, without
notice to or assent by such Grantor, to do any or all of the following
(provided, that anything in this Section 7.1(a) to the contrary notwithstanding,
the Administrative Agent agrees that it will not exercise any rights under the
power of attorney provided for in this Section 7.1(a) unless an Event of Default
shall have occurred and be continuing):
(i) in the name of such Grantor or its own name, or otherwise, take
possession of and indorse and collect any checks, drafts, notes,
acceptances or other instruments for the
16
payment of moneys due under any Receivable or with respect to any other
Collateral and file any claim or take any other action or proceeding in any
court of law or equity or otherwise deemed appropriate by the
Administrative Agent for the purpose of collecting any and all such moneys
due under any Receivable or with respect to any other Collateral whenever
payable;
(ii) in the case of any Intellectual Property, execute and deliver,
and have recorded, any and all agreements, instruments, documents and
papers as the Administrative Agent may request to evidence the
Administrative Agent's, the Canadian Administrative Agent's and the
Lenders' security interest in such Intellectual Property and the goodwill
and general intangibles of such Grantor relating thereto or represented
thereby;
(iii) pay or discharge taxes and Liens levied or placed on or
threatened against the Collateral, effect any repairs or any insurance
called for by the terms of this Agreement and pay all or any part of the
premiums therefor and the costs thereof;
(iv) execute, in connection with any sale provided for in Section 6.6
or 6.7, any indorsements, assignments or other instruments of conveyance or
transfer with respect to the Collateral; and
(v) (1) direct any party liable for any payment under any of the
Collateral to make payment of any and all moneys due or to become due
thereunder directly to the Administrative Agent or as the Administrative
Agent shall direct; (2) ask or demand for, collect, and receive payment of
and receipt for, any and all moneys, claims and other amounts due or to
become due at any time in respect of or arising out of any Collateral; (3)
sign and indorse any invoices, freight or express bills, bills of lading,
storage or warehouse receipts, drafts against debtors, assignments,
verifications, notices and other documents in connection with any of the
Collateral; (4) commence and prosecute any suits, actions or proceedings at
law or in equity in any court of competent jurisdiction to collect the
Collateral or any portion thereof and to enforce any other right in respect
of any Collateral; (5) defend any suit, action or proceeding brought
against such Grantor with respect to any Collateral; (6) settle, compromise
or adjust any such suit, action or proceeding and, in connection therewith,
give such discharges or releases as the Administrative Agent may deem
appropriate; (7) assign any Copyright, Patent or Trademark (along with the
goodwill of the business to which any such Copyright, Patent or Trademark
pertains), throughout the world for such term or terms, on such conditions,
and in such manner, as the Administrative Agent shall in its sole
discretion determine; and (8) generally, sell, transfer, pledge and make
any agreement with respect to or otherwise deal with any of the Collateral
as fully and completely as though the Administrative Agent were the
absolute owner thereof for all purposes, and do, at the Administrative
Agent's option and such Grantor's expense, at any time, or from time to
time, all acts and things which the Administrative Agent deems necessary to
protect, preserve or realize upon the Collateral and the Administrative
Agent's, the Canadian Administrative Agent's and the Lenders' security
interests therein and to effect the intent of this Agreement, all as fully
and effectively as such Grantor might do.
(b) If any Grantor fails to perform or comply with any of its agreements
contained herein, the Administrative Agent, at its option, but without any
obligation so to do, may give such Grantor written notice of such failure to
perform or comply and if such Grantor fails to perform or comply within three
(3) Business Days of receiving such notice (or if the Administrative Agent
reasonably determines that irreparable harm to the Collateral or to the security
interest of the Administrative Agent hereunder could result prior to the end of
such three-Business Day period), then the Administrative Agent may perform or
comply, or otherwise cause performance or compliance, with such agreement.
17
(c) Each Grantor hereby ratifies all that said attorneys shall lawfully do
or cause to be done by virtue hereof. All powers, authorizations and agencies
contained in this Agreement are coupled with an interest and are irrevocable
until this Agreement is terminated and the security interests created hereby are
released.
7.2 Duty of Administrative Agent. To the extent permitted by law, the
Administrative Agent's sole duty with respect to the custody, safekeeping and
physical preservation of the Collateral in its possession, under Section 9-207
of the New York UCC or otherwise, shall be to deal with it in the same manner as
the Administrative Agent deals with similar property for its own account. None
of the Administrative Agent, the Canadian Administrative Agent, any Lender or
any of their respective officers, directors, employees or agents shall be liable
for failure to demand, collect or realize upon any of the Collateral or for any
delay in doing so or shall be under any obligation to sell or otherwise dispose
of any Collateral upon the request of any Grantor or any other Person or to take
any other action whatsoever with regard to the Collateral or any part thereof.
The powers conferred on the Administrative Agent, the Canadian Administrative
Agent and the Lenders hereunder are solely to protect the Administrative
Agent's, the Canadian Administrative Agent's and the Lenders' interests in the
Collateral and shall not impose any duty upon the Administrative Agent, the
Canadian Administrative Agent or any Lender to exercise any such powers. The
Administrative Agent, the Canadian Administrative Agent and the Lenders shall be
accountable only for amounts that they actually receive as a result of the
exercise of such powers, and neither they nor any of 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 willful misconduct or
that of their directors, officers, employees or agents.
7.3 Execution of Financing Statements. Pursuant to any applicable law, each
Grantor authorizes the Administrative Agent to file or record financing
statements and other filing or recording documents or instruments with respect
to the Collateral without the signature of such Grantor in such form and in such
offices as the Administrative Agent reasonably determines appropriate to perfect
the security interests of the Administrative Agent under this Agreement. Each
Grantor authorizes the Administrative Agent to use the collateral description
"all personal property" in any such financing statements.
7.4 Authority of Administrative Agent. Each Grantor acknowledges that the
rights and responsibilities of the Administrative Agent under this Agreement
with respect to any action taken by the Administrative Agent or the exercise or
non-exercise by the Administrative Agent of any option, voting right, request,
judgment or other right or remedy provided for herein or resulting or arising
out of this Agreement shall, as among the Administrative Agent, the Canadian
Administrative Agent and the Lenders, be governed by the Credit Agreement and by
such other agreements with respect thereto as may exist from time to time among
them, but, as between the Administrative Agent and the Grantors, the
Administrative Agent shall be conclusively presumed to be acting as agent for
the Canadian Administrative Agent and the Lenders with full and valid authority
so to act or refrain from acting, and no Grantor shall be under any obligation,
or entitlement, to make any inquiry respecting such authority.
SECTION 8. MISCELLANEOUS
8.1 Amendments in Writing. None of the terms or provisions of this
Agreement may be waived, amended, supplemented or otherwise modified except in
accordance with Section 10.1 of the Credit Agreement.
8.2 Notices. All notices, requests and demands to or upon the
Administrative Agent or any Grantor hereunder shall be effected in the manner
provided for in Section 10.2 of the Credit Agreement;
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provided, that any such notice, request or demand to or upon any Guarantor shall
be addressed to such Guarantor at its notice address set forth on Schedule 1.
8.3 No Waiver by Course of Conduct; Cumulative Remedies. Neither the
Administrative Agent, the Canadian Administrative Agent nor any Lender shall by
any act (except by a written instrument pursuant to Section 8.1), delay,
indulgence, omission or otherwise be deemed to have waived any right or remedy
hereunder or to have acquiesced in any Default or Event of Default. No failure
to exercise, nor any delay in exercising, on the part of the Administrative
Agent, the Canadian Administrative Agent or any Lender, any right, power or
privilege hereunder shall operate as a waiver thereof. No single or partial
exercise of any right, power or privilege hereunder shall preclude any other or
further exercise thereof or the exercise of any other right, power or privilege.
A waiver by the Administrative Agent, the Canadian Administrative Agent or any
Lender of any right or remedy hereunder on any one occasion shall not be
construed as a bar to any right or remedy which the Administrative Agent, the
Canadian Administrative Agent or such Lender would otherwise have on any future
occasion. The rights and remedies herein provided are cumulative, may be
exercised singly or concurrently and are not exclusive of any other rights or
remedies provided by law.
8.4 Enforcement Expenses; Indemnification. Each Guarantor agrees to pay,
and to save the Administrative Agent and the Lenders harmless from, any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever with respect
to the execution, delivery, enforcement, performance and administration of this
Agreement to the extent the Borrower would be required to do so pursuant to
Section 10.5 of the Credit Agreement. The agreements in this Section 8.4 shall
survive repayment of the Obligations and all other amounts payable under the
Credit Agreement and the other Loan Documents.
8.5 Successors and Assigns. This Agreement shall be binding upon the
successors and assigns of each Grantor and shall inure to the benefit of the
Administrative Agent, the Canadian Administrative Agent and the Lenders and
their successors and assigns; provided, that no Grantor may assign, transfer or
delegate any of its rights or obligations under this Agreement without the prior
written consent of the Administrative Agent (it being understood that
Dispositions permitted under the Credit Agreement shall not be subject to this
proviso).
8.6 Set-Off. Each Grantor hereby irrevocably authorizes the Administrative
Agent, the Canadian Administrative Agent and each Lender at any time and from
time to time while an Event of Default shall have occurred and be continuing,
without notice to such Grantor or any other Grantor, any such notice being
expressly waived by each Grantor, to the extent permitted by applicable law,
upon any amount becoming due and payable by each Grantor (whether at the stated
maturity, by acceleration or otherwise after the expiration of any applicable
grace periods) to set-off and appropriate and apply against such amount any and
all deposits (general or special, time or demand, provisional or final but
excluding trust accounts), in any currency, and any other credits, indebtedness
or claims, in any currency, in each case whether direct or indirect, absolute or
contingent, matured or unmatured, at any time held or owing by the
Administrative Agent, the Canadian Administrative Agent or such Lender to or for
the credit or the account of such Grantor. Each of Administrative Agent, the
Canadian Administrative Agent and each Lender shall notify such Grantor promptly
of any such set-off made by it and the application made by it of the proceeds
thereof, provided that the failure to give such notice shall not affect the
validity of such set-off and application.
8.7 Counterparts. This Agreement may be executed by one or more of the
parties to this Agreement on any number of separate counterparts (including by
telecopy), and all of said counterparts taken together shall be deemed to
constitute one and the same instrument.
19
8.8 Severability. Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
8.9 Section Headings. The Section headings used in this Agreement are for
convenience of reference only and are not to affect the construction hereof or
be taken into consideration in the interpretation hereof.
8.10 Integration. This Agreement and the other Loan Documents represent the
agreement of the Grantors, the Administrative Agent, the Canadian Administrative
Agent and the Lenders with respect to the subject matter hereof and thereof.
8.11 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
8.12 Submission To Jurisdiction; Waivers. Each Grantor hereby irrevocably
and unconditionally:
(a) submits for itself and its property in any legal action or proceeding
relating to this Agreement and the other Loan Documents to which it is a party,
or for recognition and enforcement of any judgment in respect thereof, to the
non-exclusive general jurisdiction of the Courts of the State of New York, the
courts of the United States of America for the Southern District of New York,
and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought in such
courts and waives any objection that it may now or hereafter have to the venue
of any such action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead or claim
the same;
(c) agrees that service of process in any such action or proceeding may be
effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to such Grantor at its
address referred to in Section 8.2 or at such other address of which the
Administrative Agent shall have been notified pursuant thereto;
(d) agrees that nothing herein shall affect the right to effect service of
process in any other manner permitted by law or shall limit the right to xxx in
any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law, any right it may
have to claim or recover in any legal action or proceeding referred to in this
Section any special, exemplary, punitive or consequential damages.
8.13 Acknowledgements. Each Grantor hereby acknowledges that:
(a) it has been advised by counsel in the negotiation, execution and
delivery of this Agreement and the other Loan Documents to which it is a party;
(b) neither the Administrative Agent, the Canadian Administrative Agent nor
any Lender has any fiduciary relationship with or duty to any Grantor arising
out of or in connection with this Agreement
20
or any of the other Loan Documents, and the relationship between the Grantors,
on the one hand, and the Administrative Agent, the Canadian Administrative Agent
and Lenders, on the other hand, in connection herewith or therewith is solely
that of debtor and creditor; and
(c) no joint venture is created hereby or by the other Loan Documents or
otherwise exists by virtue of the transactions contemplated hereby among the
Lenders or among the Grantors and the Lenders.
8.14 Additional Grantors. Each Subsidiary of the US Borrower that is
required to become a party to this Agreement pursuant to Section 6.9 of the
Credit Agreement shall become a Grantor for all purposes of this Agreement upon
execution and delivery by such Subsidiary of an Assumption Agreement in the form
of Annex 1 hereto.
8.15 Releases. (a) At such time as the Loans, the Reimbursement Obligations
and the other Obligations (other than Borrower Hedge Agreement Obligations,
Borrower Cash Management Obligations and contingent or indemnification
obligations not then due) shall have been paid in full, the Commitments shall
have been terminated and no Letter of Credit or B/A (that is not cash
collateralized to the reasonable satisfaction of the Issuing Bank or purchasing
Lender, as applicable, in respect thereof) shall be outstanding, the Collateral
shall be released from the Liens created hereby, and this Agreement and all
obligations (other than those expressly stated to survive such termination) of
the Administrative Agent and each Grantor hereunder shall terminate, all without
delivery of any instrument or performance of any act by any party, and all
rights to the Collateral shall revert to the Grantors. At the request and sole
expense of any Grantor following any such termination, the Administrative Agent
shall deliver to such Grantor any Collateral held by the Administrative Agent
hereunder, and execute and deliver to such Grantor such documents as such
Grantor shall reasonably request to evidence such termination.
(b) If any of the Collateral shall be sold, transferred or otherwise
disposed of by any Grantor in a transaction permitted by the Credit Agreement,
then the Administrative Agent, at the request and sole expense of such Grantor,
shall execute and deliver to such Grantor all releases or other documents
reasonably necessary or desirable for the release of the Liens created hereby on
such Collateral. At the request and sole expense of the US Borrower, a
Subsidiary Guarantor shall be released from its obligations hereunder in the
event that all the Capital Stock of such Guarantor shall be sold, transferred or
otherwise disposed of in a transaction permitted by the Credit Agreement.
8.16 WAIVER OF JURY TRIAL. EACH GRANTOR AND, BY ACCEPTANCE OF THE BENEFITS
HEREOF, THE ADMINISTRATIVE AGENT, THE CANADIAN ADMINISTRATIVE AGENT AND EACH
LENDER, HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL
ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND
FOR ANY COUNTERCLAIM THEREIN.
IN WITNESS WHEREOF, each of the undersigned has caused this Guarantee
and Collateral Agreement to be duly executed and delivered as of the date first
above written.
SS&C TECHNOLOGIES, INC.
By: /s/ Xxxxxxx X. Xxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Chairman & CEO
Signature Page to Guarantee and Collateral Agreement
SUNSHINE ACQUISITION II, INC.
By: /s/ Xxxxxxxx Xxxx
------------------------------------
Name: Xxxxxxxx Xxxx
Title: Secretary
Signature Page to Guarantee and Collateral Agreement
SUNSHINE ACQUISITION CORPORATION
By: /s/ Xxxxxxx X. Xxxxx
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
Signature Page to Guarantee and Collateral Agreement
SS&C FUND ADMINISTRATION SERVICES LLC
By: /s/ Xxxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: SVP & Treasurer
Signature Page to Guarantee and Collateral Agreement
OMR SYSTEMS CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: SVP & Treasurer
Signature Page to Guarantee and Collateral Agreement
FINANCIAL MODELS HOLDINGS INC.
By: /s/ Xxxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: SVP & Treasurer
Signature Page to Guarantee and Collateral Agreement
FINANCIAL MODELS COMPANY LTD.
By: /s/ Xxxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: SVP & Treasurer
Signature Page to Guarantee and Collateral Agreement
OPEN INFORMATION SYSTEMS, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: SVP & Treasurer
Signature Page to Guarantee and Collateral Agreement
Annex I to
Guarantee and Collateral Agreement
ASSUMPTION AGREEMENT, dated as of __________ __, 200_, made by
______________________________ (the "Additional Grantor"), in favor of JPMorgan
Chase Bank, N.A., as administrative agent (in such capacity, the "Administrative
Agent") for the banks and other financial institutions or entities (the
"Lenders") parties to the Credit Agreement referred to below. All capitalized
terms not defined herein shall have the meaning ascribed to them in such Credit
Agreement.
WITNESSETH:
WHEREAS, Sunshine Acquisition II, Inc., (the "Initial US Borrower"),
SS&C Technologies, Inc., (the "Surviving US Borrower"), SS&C Technologies Canada
Corp., as CDN Borrower, the Lenders, JPMorgan Chase Bank, N.A., Toronto Branch,
as Canadian administrative agent (the "Canadian Administrative Agent") and the
Administrative Agent have entered into a Credit Agreement, dated as of November
23, 2005 (as amended, supplemented or otherwise modified from time to time, the
"Credit Agreement");
WHEREAS, in connection with the Credit Agreement, the Initial US
Borrower, the Surviving US Borrower and certain of its Affiliates (other than
the Additional Grantor) have entered into the Guarantee and Collateral
Agreement, dated as of November 23, 2005 (as amended, supplemented or otherwise
modified from time to time, the "Guarantee and Collateral Agreement") in favor
of the Administrative Agent for the benefit of the Administrative Agent, the
Canadian Administrative Agent and the Lenders;
WHEREAS, the Credit Agreement requires the Additional Grantor to
become a party to the Guarantee and Collateral Agreement; and
WHEREAS, the Additional Grantor has agreed to execute and deliver this
Assumption Agreement in order to become a party to the Guarantee and Collateral
Agreement;
NOW, THEREFORE, IT IS AGREED:
1. Guarantee and Collateral Agreement. By executing and delivering
this Assumption Agreement, the Additional Grantor, as provided in Section 8.14
of the Guarantee and Collateral Agreement, hereby becomes a party to the
Guarantee and Collateral Agreement as a Grantor thereunder with the same force
and effect as if originally named therein as a Grantor and, without limiting the
generality of the foregoing, hereby expressly assumes all obligations and
liabilities of a Grantor thereunder. The information set forth in Annex 1-A
hereto is hereby added to the information set forth in the Schedules to the
Guarantee and Collateral Agreement. The Additional Grantor hereby represents and
warrants, to the extent applicable, that each of the representations and
warranties contained in Section 4 of the Guarantee and Collateral Agreement is
true and correct on and as of the date hereof (after giving effect to this
Assumption Agreement) as if made on and as of such date.
2. GOVERNING LAW. THIS ASSUMPTION AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, the undersigned has caused this Assumption
Agreement to be duly executed and delivered as of the date first above written.
ADDITIONAL GRANTOR
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
2
Annex 1-A to
Assumption Agreement
Supplement to Schedule 1
Supplement to Schedule 2
Supplement to Schedule 3
Supplement to Schedule 4
Supplement to Schedule 5
Supplement to Schedule 6
Annex II to
Guarantee and Collateral Agreement
ACKNOWLEDGMENT AND CONSENT
The undersigned hereby acknowledges receipt of a copy of the Guarantee and
Collateral Agreement dated as of November 23, 2005 (the "Agreement"), made by
the Grantors parties thereto for the benefit of JPMorgan Chase Bank, N.A., as
Administrative Agent. The undersigned agrees for the benefit of the
Administrative Agent, the Canadian Administrative Agent and the Lenders as
follows:
1. The undersigned will be bound by the terms of the Agreement and
will comply with such terms insofar as such terms are applicable to the
undersigned.
2. The terms of Sections 6.3(c) and 6.7 of the Agreement shall apply
to it, mutatis mutandis, with respect to all actions that may be required of it
pursuant to Section 6.3(c) or 6.7 of the Agreement.
[NAME OF ISSUER]
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
Address for Notices:
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Fax:
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