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EXHIBIT 4F
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GUARANTEE AND COLLATERAL AGREEMENT
made by
TELEX COMMUNICATIONS, INC.
(as successor to GST ACQUISITION CORP.)
TELEX COMMUNICATIONS GROUP, INC.
and
TCI HOLDINGS CORP.
in favor of
THE CHASE MANHATTAN BANK,
as Administrative Agent
Dated as of May 6, 1997
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TABLE OF CONTENTS
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SECTION 1. DEFINED TERMS.................................................................. 1
1.1 Definitions.................................................................... 1
1.2 Other Definitional Provisions.................................................. 8
SECTION 2. GUARANTEE...................................................................... 8
2.1 Guarantee...................................................................... 8
2.2 Right of Contribution.......................................................... 9
2.3 No Subrogation................................................................. 10
2.4 Amendments, etc. with respect to the Borrower Obligations...................... 10
2.5 Guarantee Absolute and Unconditional........................................... 11
2.6 Reinstatement.................................................................. 12
2.7 Payments....................................................................... 12
SECTION 3. GRANT OF SECURITY INTEREST..................................................... 12
SECTION 4. REPRESENTATIONS AND WARRANTIES................................................. 14
4.1 Representations and Warranties of Each Guarantor............................... 14
4.2 Representations and Warranties of Each Grantor................................. 14
4.2.1 Title; No Other Liens................................................. 14
4.2.2 Perfected First Priority Liens........................................ 14
4.2.3 Chief Executive Office................................................ 16
4.2.4 Inventory and Equipment............................................... 16
4.2.5 Farm Products......................................................... 16
4.2.6 Accounts.............................................................. 16
4.2.7 Intellectual Property................................................. 16
4.3 Representations and Warranties of Each Pledgor................................. 16
SECTION 5. COVENANTS...................................................................... 17
5.1 Covenants of Each Guarantor.................................................... 17
5.2 Covenants of Each Grantor...................................................... 18
5.2.1 Delivery of Instruments and Chattel Paper............................. 18
5.2.2 Maintenance of Insurance.............................................. 18
5.2.3 Payment of Obligations................................................ 18
5.2.4 Maintenance of Perfected Security Interest; Further Documentation..... 19
5.2.5 Changes in Locations, Name, etc....................................... 19
5.2.6 Notices............................................................... 20
5.2.7 Pledged Securities.................................................... 20
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5.2.8 Accounts.............................................................. 20
5.2.9 Maintenance of Records................................................ 21
5.2.10 Acquisition of Intellectual Property.................................. 21
5.2.11 Protection of Trade Secrets........................................... 21
5.3 Covenants of Each Pledgor...................................................... 21
5.4 Covenants of Holdings.......................................................... 23
SECTION 6. REMEDIAL PROVISIONS............................................................ 24
6.1 Certain Matters Relating to Accounts........................................... 24
6.2 Communications with Obligors; Grantors Remain Liable........................... 26
6.3 Pledged Stock.................................................................. 26
6.4 Proceeds to be Turned Over To Administrative Agent............................. 28
6.5 Application of Proceeds........................................................ 28
6.6 Code and Other Remedies........................................................ 29
6.7 Registration Rights............................................................ 30
6.8 Waiver; Deficiency............................................................. 31
SECTION 7. THE ADMINISTRATIVE AGENT....................................................... 31
7.1 Administrative Agent's Appointment as Attorney-in-Fact, etc.................... 31
7.2 Duty of Administrative Agent................................................... 33
7.3 Execution of Financing Statements.............................................. 34
7.4 Authority of Administrative Agent.............................................. 34
7.5 Right Of Inspection............................................................ 34
SECTION 8. MISCELLANEOUS.................................................................. 35
8.1 Amendments in Writing.......................................................... 35
8.2 Notices........................................................................ 35
8.3 No Waiver by Course of Conduct; Cumulative Remedies............................ 35
8.4 Enforcement Expenses; Indemnification.......................................... 35
8.5 Successors and Assigns......................................................... 36
8.6 Set-Off........................................................................ 36
8.7 Counterparts................................................................... 37
8.8 Severability................................................................... 37
8.9 Section Headings............................................................... 37
8.10 Integration.................................................................... 37
8.11 GOVERNING LAW.................................................................. 37
8.12 Submission To Jurisdiction; Waivers............................................ 37
8.13 Acknowledgements............................................................... 38
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8.14 WAIVER OF JURY TRIAL........................................................... 38
8.15 Additional Granting Parties.................................................... 38
8.16 Releases....................................................................... 39
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SCHEDULES
1 Notice Addresses of Guarantors
2 Description of Pledged Securities
3 Location of Jurisdiction of Organization and Chief Executive Office or
Sole Place of Business
4 Location of Inventory and Equipment
5 Copyrights and Copyright Licenses; Patents and Patent Licenses;
Trademarks and Trademark Licenses
6 Existing Prior Liens
7 Accounts
8 Contracts
ANNEXES
1 Assumption Agreement
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EXHIBIT 4F
GUARANTEE AND COLLATERAL AGREEMENT
GUARANTEE AND COLLATERAL AGREEMENT, dated as of May 6, 1997,
made by TELEX COMMUNICATIONS, INC., a Delaware corporation ("Telex" or the
"Borrower") as successor by assumption to GST Acquisition Corp. upon the
effectiveness of the Telex Assumption Agreement (as defined herein), TELEX
COMMUNICATIONS GROUP, INC., a Delaware Corporation ("Holdings"), and TCI
HOLDINGS CORP., together with any other Subsidiary of the Borrower that becomes
a party hereto from time to time after the date hereof, the ("Granting
Parties"), in favor of THE CHASE MANHATTAN BANK, as administrative agent (in
such capacity, the "Administrative Agent") for the banks and other financial
institutions (collectively, the "Lenders"; individually, a "Lender") from time
to time parties to the Credit Agreement, dated as of May 6, 1997 (as amended,
waived, supplemented or otherwise modified from time to time, the "Credit
Agreement"), among the Borrower, the Lenders, the Administrative Agent and
Xxxxxx Xxxxxxx Senior Funding, Inc., as Documentation Agent.
W I T N E S S E T H:
WHEREAS, pursuant to the Credit Agreement, the Lenders have
severally agreed to make extensions of credit to the Borrower upon the terms and
subject to the conditions set forth therein;
WHEREAS, it is a condition to the obligation of the Lenders to
make their respective extensions of credit to the Borrower under the Credit
Agreement that the Granting Parties shall execute and deliver this Agreement to
the Administrative Agent for the 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
Borrower thereunder, each Granting Party hereby agrees with the Administrative
Agent, for the ratable benefit of the Secured Parties, 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 which are defined in the
Code (as defined below) are used herein as so defined: Chattel Paper, Documents,
Equipment, Farm Products, Fixtures, Instruments and Inventory.
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(b) The following terms shall have the following meanings:
"Accounts": all accounts (as defined in the Code) of the
Borrower, including, without limitation all Accounts (as defined in the
Credit Agreement) of the Borrower.
"Agreement": this Guarantee and Collateral Agreement, as the
same may be amended, supplemented or otherwise modified from time to
time.
"Borrower Obligations": the collective reference to the unpaid
principal of and interest on the Loans and Reimbursement Obligations
and all other obligations and liabilities of the 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 the Borrower, whether or not a claim for
post-filing or post-petition interest is allowed in such proceeding) to
the Administrative Agent or any Lender (or, in the case of any Hedge
Agreement referred to below, any Affiliate of 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 and any Letter of Credit or any Hedge Agreement entered
into by the Borrower with any Lender (or, in the case of any Hedge
Agreement, any Affiliate of any Lender) 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 or to the Lenders that are required to be paid by the Borrower
pursuant to the terms of any of the foregoing agreements).
"Code": the Uniform Commercial Code as from time to time in
effect in the State of New York.
"Collateral": as defined in Section 3.
"Collateral Account Bank": The Chase Manhattan Bank or another
bank which at all times is a Lender as selected by the Borrower and
notified to the Administrative Agent in writing promptly following such
selection.
"Collateral Proceeds Account": the cash collateral account
established by the relevant Grantor at an office of the Collateral
Account Bank in the name of the Administrative Agent.
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"Commitments": the collective reference to the Revolving
Credit Commitments, the Swing Line Commitments, the Term Loan
Commitments and the L/C Commitment; individually, a "Commitment".
"Contracts" with respect to any Grantor, all contracts,
agreements, instruments and indentures in any form, and portions
thereof (except for the contracts listed on Schedule 8), to which such
Grantor is a party or under which such Grantor has any right, title or
interest or to which such Grantor or any property of such Grantor is
subject, as the same may from time to time be amended, supplemented or
otherwise modified, including, without limitation, (i) all rights of
such Grantor to receive moneys due and to become due to it thereunder
or in connection therewith, (ii) all rights of such Grantor to damages
arising thereunder and (iii) all rights of such Grantor to perform and
to exercise all remedies thereunder.
"Copyright Licenses": with respect to any Grantor, all United
States written license agreements of such Grantor providing for the
grant by or to such Grantor of any right to use any Copyright of such
Grantor, other than intercompany agreements, including, without
limitation, any license agreements listed on Schedule 5 hereto subject,
in each case, to the terms of such license agreements, and the right to
prepare for sale, sell and advertise for sale, all Inventory now or
hereafter covered by such licenses.
"Copyrights": with respect to any Grantor, all of such
Grantor's right, title and interest in and to all United States
copyrights, whether or not the underlying works of authorship have been
published or registered, United States copyright registrations and
copyright applications, and (a) all renewals thereof, (b) all income,
royalties, damages and payments now and hereafter due and/or payable
with respect thereto, including, without limitation, payments under all
licenses entered into in connection therewith, and damages and payments
for past or future infringement thereof and (c) the right to xxx or
otherwise recover for past, present and future infringement and
misappropriation thereof.
"Default": a "Default" as defined in the Credit Agreement.
"Event of Default": an "Event of Default" as defined in the
Credit Agreement.
"General Fund Account": the general fund account of the
relevant Grantor established at the same office of the Collateral
Account Bank as the Collateral Proceeds Account.
"General Intangibles": all "general intangibles" as such term
is defined in Section 9-106 of the Uniform Commercial Code in effect in
the State of New York on the date hereof.
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"Granting Parties": as defined in the initial paragraph
hereof.
"Grantor": the Borrower and each Domestic Subsidiary of the
Borrower that from time to time becomes a party hereto.
"Guarantor Obligations": with respect to any Guarantor, the
collective reference to (i) the Borrower Obligations and (ii) all
obligations and liabilities of such Guarantor which may arise under or
in connection with this Agreement 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 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 each Granting Party
other than the Borrower.
"Hedge Agreements": as to any Grantor, all interest rate
swaps, caps or collar agreements or similar arrangements entered into
by such Person providing for protection against fluctuations in
interest rates or currency exchange rates or the exchange of nominal
interest obligations, either generally or under specific contingencies,
including, without limitation, all Interest Rate Protection Agreements
and Permitted Hedging Arrangements with respect to currency exchange
rates.
"Intellectual Property": with respect to any Grantor, the
collective reference to such Grantor's Copyrights, Copyright Licenses,
Patents, Patent Licenses, Trade Secrets, Trademarks and Trademark
Licenses.
"Intercompany Note": with respect to any Grantor, any
promissory note evidencing loans made by such Grantor to the Borrower
or any of its Subsidiaries.
"Issuers": the collective reference to the Persons identified
on Schedule 2 as the issuers of the Pledged Stock.
"Inventory": with respect to any Grantor, all inventory (as
defined in the Code) of such Grantor, including, without limitation,
all Inventory (as defined in the Credit Agreement) of the Borrower.
"Loan Documents": the collective reference to the "Loan
Documents" as defined in the Credit Agreement.
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"Loans": the collective reference to the "Loans" as defined in
the Credit Agreement.
"Notes": the collective reference to the "Notes" as defined in
the Credit Agreement.
"Obligations": (i) in the case of the Borrower, the Borrower
Obligations, and (ii) in the case of each Guarantor, its Guarantor
Obligations.
"Patent Licenses": with respect to any Grantor, all United
States written license agreements of such Grantor with any Person who
is not an Affiliate or a Subsidiary in connection with any of the
Patents of such Grantor or such other Person's patents, whether such
Grantor is a licensor or a licensee under any such agreement,
including, without limitation, the license agreements listed on
Schedule 5, subject, in each case, to the terms of such license
agreements, and the right to prepare for sale, sell and advertise for
sale, all Inventory now or hereafter covered by such licenses.
"Patents": with respect to any Grantor, all of such Grantor's
right, title and interest in and to all United States patents, patent
applications and patentable inventions and all reissues and extensions
thereof, including, without limitation, all patents and patent
applications identified in Schedule 5, and including, without
limitation, (a) all inventions and improvements described and claimed
therein, and patentable inventions, (b) the right to xxx or otherwise
recover for any and all past, present and future infringement and
misappropriation thereof, (c) all income, royalties, damages and other
payments now and hereafter due and/or payable with respect thereto
(including, without limitation, payments under all licenses entered
into in connection therewith, and damages and payments for past or
future infringements thereof), and (d) all other rights corresponding
thereto in the United States and all reissues, divisions,
continuations, continuations-in-part, substitutes, renewals, and
extensions thereof, all improvements thereon, and all other rights of
any kind whatsoever of such Grantor accruing thereunder or pertaining
thereto.
"Pledged Collateral": as defined in Section 3.
"Pledged Notes": with respect to any Pledgor, all Intercompany
Notes at any time issued to such Pledgor and all other promissory notes
issued to or held by such Pledgor (other than promissory notes issued
in connection with extensions of trade credit by any Pledgor in the
ordinary course of business).
"Pledged Securities": the collective reference to the Pledged
Notes and the Pledged Stock.
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"Pledged Stock": with respect to any Pledgor, the shares of
Capital Stock listed on Schedule 2 as held by such Pledgor, together
with any other shares, stock certificates, options or rights of any
nature whatsoever in respect of the Capital Stock of any Issuer that
may be issued or granted to, or held by, such Pledgor while this
Agreement is in effect (provided that in no event shall there be
pledged, nor shall any Pledgor be required to pledge, directly or
indirectly, more than 65% of any series of the outstanding Capital
Stock of any Foreign Subsidiary pursuant to this Agreement).
"Pledgor": Holdings (with respect to Pledged Stock of the
Borrower), the Borrower (with respect to Pledged Stock of the
corporations listed on Schedule 2 hereto under the name of the Borrower
and any other Subsidiary of the Borrower and any other Pledged
Securities held by the Borrower) and any other Granting Party (with
respect to Pledged Securities held by such Granting Party).
"Proceeds": all "proceeds" as such term is defined in Section
9-306(1) of the Uniform Commercial Code in effect in the State of New
York on the date hereof and, in any event, Proceeds of Pledged
Securities shall include, without limitation, all dividends or other
income from the Pledged Securities, collections thereon or
distributions or payments with respect thereto.
"Revolving Credit Commitments": the collective reference to
the "Revolving Credit Commitments" as defined in the Credit Agreement.
"Secured Parties": the collective reference to the
Administrative Agent, the Lenders (including, without limitation the
Issuing Lender) and any Affiliate of any Lender which has entered into
any Interest Rate Protection Agreement or Permitted Hedging Arrangement
with the Borrower or any of its Subsidiaries, and their respective
successors and assigns.
"Securities Act": the Securities Act of 1933, as amended from
time to time.
"Security Collateral": as defined in Section 3.
"Trade Secrets": with respect to any Grantor, all of such
Grantor's right, title and interest in and to all United States trade
secrets, including, without limitation, know-how, processes, formulae,
compositions, designs, and confidential business and technical
information, and all rights of any kind whatsoever accruing thereunder
or pertaining thereto, including, without limitation, (a) all income,
royalties, damages and payments now and hereafter due and/or payable
with respect thereto, including, without limitation, payments under all
licenses, non-disclosure agreements and memoranda of understanding
entered into in connection therewith, and damages and payments for past
or future
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misappropriation thereof, and (b) the right to xxx or otherwise recover
for past, present or future misappropriation thereof.
"Trademark Licenses": with respect to any Grantor, all United
States written license agreements of such Grantor with any Person who
is not an Affiliate or a Subsidiary in connection with any of the
Trademarks of such Grantor or such other Person's names or trademarks,
whether such Grantor is a licensor or a licensee under any such
agreement, including, without limitation, the license agreements listed
on Schedule 5, subject, in each case, to the terms of such license
agreements, and the right to prepare for sale, sell and advertise for
sale, all Inventory now or hereafter covered by such licenses.
"Trademarks": with respect to any Grantor, all of such
Grantor's right, title and interest in and to all United States
trademarks, service marks, trade names, trade dress or other indicia of
trade origin or business identifiers, trademark and service xxxx
registrations, and applications for trademark or service xxxx
registrations (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. Section 1051, unless and until an Amendment to Allege
Use or a Statement of Use under Sections 1(c) and 1(d) of said Act has
been filed), and any renewals thereof, including, without limitation,
each registration and application identified in Schedule 5, and
including, without limitation, (a) the right to xxx or otherwise
recover for any and all past, present and future infringements and
misappropriation thereof, (b) all income, royalties, damages and other
payments now and hereafter due and/or payable with respect thereto
(including, without limitation, payments under all licenses entered
into in connection therewith, and damages and payments for past or
future infringements thereof), and (c) all other rights corresponding
thereto in the United States and all other rights of any kind
whatsoever of such Grantor accruing thereunder or pertaining thereto,
together in each case with the goodwill of the business connected with
the use of, and symbolized by, each such trademark, service xxxx, trade
name, trade dress or other indicia of trade origin or business
identifiers.
"Vehicles": all cars, trucks, trailers, construction and earth
moving equipment and other vehicles covered by a certificate of title
law of any state and all tires and other appurtenances to any of the
foregoing.
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, Schedule and Annex references are to
this Agreement unless otherwise specified.
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(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, Pledged Collateral or Security Collateral, or any part thereof, when
used in relation to a Granting Party shall refer to such Granting Party's
Collateral, Pledged Collateral or Security Collateral or the relevant part
thereof.
SECTION 2. GUARANTEE
2.1 Guarantee. (a) Each of the Guarantors hereby, jointly and
severally, unconditionally and irrevocably, guarantees to the Administrative
Agent, for the ratable benefit of the Secured Parties and their respective
successors, indorsees, transferees and assigns, the prompt and complete payment
and performance by the Borrower when due and payable (whether at the stated
maturity, by acceleration or otherwise) of the Borrower Obligations.
(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 law, including applicable federal
and state laws relating to the insolvency of debtors.
(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 or any other
Secured Party hereunder.
(d) The guarantee contained in this Section 2 shall remain in
full force and effect until the earlier to occur of (i) the first date on which
all the Loans, any Reimbursement Obligations, all other Borrower Obligations
then due and owing, and the obligations of each Guarantor under the guarantee
contained in this Section 2 then due and owing shall have been satisfied by
payment in full, no Letter of Credit shall be outstanding and the Commitments
shall be terminated, notwithstanding that from time to time during the term of
the Credit Agreement the Borrower may be free from any Borrower Obligations or
(ii) as to any Guarantor, the sale or other disposition of all of the Capital
Stock of such Guarantor permitted under the Credit Agreement.
(e) No payment made by the Borrower, any of the Guarantors,
any other guarantor or any other Person or received or collected by the
Administrative Agent or any other Secured Party from the Borrower, any of the
Guarantors, any other guarantor or any other Person
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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 earlier to
occur of (i) the first date on which the Loans, any Reimbursement Obligations,
and all other Borrower Obligations then due and owing, are paid in full, no
Letter of Credit shall be outstanding and the Commitments are terminated or (ii)
the sale or other disposition of all of the Capital Stock of such Guarantor
permitted under the Credit Agreement.
2.2 Right of Contribution. Each Guarantor hereby agrees that
to the extent that a Guarantor shall have paid more than its proportionate share
of any payment made hereunder, such Guarantor shall be entitled to seek and
receive contribution from and against any other Guarantor hereunder which has
not paid its proportionate share of such payment. Each 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 Guarantor to the Administrative Agent and the other Secured
Parties, and each Guarantor shall remain liable to the Administrative Agent and
the Lenders for the full amount guaranteed by such Guarantor hereunder.
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 or any other Secured Party, no Guarantor shall be
entitled to be subrogated to any of the rights of the Administrative Agent or
any other Secured Party against the Borrower or any other Guarantor or any
collateral security or guarantee or right of offset held by the Administrative
Agent or any other Secured Party for the payment of the Borrower Obligations,
nor shall any Guarantor seek or be entitled to seek any contribution or
reimbursement from the Borrower or any other Guarantor in respect of payments
made by such Guarantor hereunder, until all amounts owing to the Administrative
Agent and the other Secured Parties by the Borrower on account of the Borrower
Obligations are paid in full, no Letter of Credit shall be outstanding and the
Commitments are terminated. If any amount shall be paid to any Guarantor on
account of such subrogation rights at any time when all of the Borrower
Obligations shall not have been paid in full, such amount shall be held by such
Guarantor in trust for the Administrative Agent and the other Secured Parties,
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.
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2.4 Amendments, etc. with respect to the Borrower Obligations.
To the maximum extent permitted by law, 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
or any other Secured Party may be rescinded by the Administrative Agent or such
other Secured Party 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 or any other Secured Party, 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, 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 or any other Secured Party for the payment of the Borrower
Obligations may be sold, exchanged, waived, surrendered or released. Neither the
Administrative Agent nor any other Secured Party 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, except to the extent required by applicable law.
2.5 Guarantee Absolute and Unconditional. Each Guarantor
waives, to the maximum extent permitted by applicable law, 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 or any other
Secured Party 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 Borrower and any of
the Guarantors, on the one hand, and the Administrative Agent and the other
Secured Parties, 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, to the maximum extent permitted by applicable
law, diligence, presentment, protest, demand for payment and notice of default
or nonpayment to or upon the Borrower or any of the other Guarantors with
respect to the Borrower Obligations. Each Guarantor understands and agrees, to
the extent permitted by law, that the guarantee contained in this Section 2
shall be construed as a continuing, absolute and unconditional guarantee of
payment. Each Guarantor hereby waives, to the maximum extent permitted by
applicable law, any and all defenses that it may have arising out of or in
connection with any and all of the following: (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
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Administrative Agent or any other Secured Party, (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 the Borrower against the Administrative
Agent or any other Secured Party, (c) any change in the time, place, manner or
place of payment, amendment, or waiver or increase in the Obligations, (d) any
exchange, taking, or release of Collateral, (e) any change in the corporate
structure or existence of the Borrower, (f) any application of Collateral to
Obligations or (g) any other circumstance whatsoever (with or without notice to
or knowledge of the Borrower or such Guarantor) which constitutes, or might be
construed to constitute, an equitable or legal discharge of the 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 or any other Secured Party 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 the 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 or any other Secured Party to make any such demand, to
pursue such other rights or remedies or to collect any payments from the
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 the 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 or any other Secured Party 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
or any other Secured Party upon the insolvency, bankruptcy, dissolution,
liquidation or reorganization of the 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, the 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 at the office of the Administrative Agent located at 000
Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
SECTION 3. GRANT OF SECURITY INTEREST
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Each Granting Party (1) that is a Grantor hereby grants to the
Administrative Agent, for the ratable benefit of the Secured Parties, 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 the Obligations of such Grantor:
(a) all Accounts;
(b) all Chattel Paper;
(c) all Contracts;
(d) all Documents;
(e) all Equipment (other than Vehicles);
(f) all General Intangibles;
(g) all Instruments;
(h) all Intellectual Property;
(i) all Inventory;
(j) all books and records pertaining to any of the foregoing;
(k) the Collateral Proceeds Account; and
(l) 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;
and (2) that is a Pledgor hereby grants to the Administrative Agent, for the
ratable benefit of the Secured Parties, a security interest in all of the
Pledged Securities now owned or at any time hereafter acquired by such Pledgor,
and any Proceeds thereof (the "Pledged Collateral"), as collateral security for
the prompt and complete performance when due (whether at the stated maturity by
acceleration or otherwise) of the obligations of the Pledgor; (the Collateral
(if any) and the Pledged Collateral (if any) of any Granting Party being
collectively referred to herein as such Granting Party's "Security Collateral");
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provided however, that (x) Collateral shall not include any Pledged Collateral,
or any property or assets specifically excluded from Pledged Collateral
(including any Capital Stock of any Foreign Subsidiary in excess of 65% of any
series of such stock); and (y) in the case of any Instruments, Contracts,
Chattel Paper, General Intangibles, Copyright Licenses, Patent Licenses,
Trademark Licenses or other contracts or agreements with or issued by Persons
(other than a Subsidiary of the Borrower) that would otherwise be included in
the Security Collateral, no security interest in the right, title and interest
of any Granting Party thereunder or therein will be granted pursuant to this
Section 2 (and such Instruments, Contracts, Chattel Paper, General Intangibles,
Copyright Licenses, Patent Licenses, Trademark Licenses or other contracts or
agreements shall not be deemed to constitute a part of the Security Collateral)
for so long as, and to the extent that, the granting of a security interest in
the right, title and interest of such Grantor thereunder or therein pursuant to
the terms hereof would result in a breach, default or termination of such
Instruments, Contracts, Chattel Paper, General Intangibles, Copyright Licenses,
Patent Licenses, Trademark Licenses or other contracts or agreements and (z) in
the case of the Equipment that would otherwise be included in the foregoing
Collateral, the foregoing will not be deemed to grant a security interest
therein under this Agreement (and such Equipment shall not be deemed to
constitute a part of the Collateral) if such Equipment is subject to a Lien
permitted by subsection 8.3(h) of the Credit Agreement.
SECTION 4. REPRESENTATIONS AND WARRANTIES
4.1 Representations and Warranties of Each Guarantor. 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 Borrower thereunder, each Guarantor hereby represents and warrants
to the Administrative Agent and each other Secured Party that the
representations and warranties set forth in Section 5 of the Credit Agreement as
they relate to such Guarantor or to the Loan Documents to which such Guarantor
is a party or to the Transaction Documents to which such Guarantor is a party,
each of which representations and warranties is hereby incorporated herein by
reference, are true and correct in all material respects, and the Administrative
Agent and each other Secured Party shall be entitled to rely on each of such
representations and warranties as if fully set forth herein; provided that each
reference in each such representation and warranty to the 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 Representations and Warranties of Each Grantor. 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
Borrower thereunder, each Grantor hereby represents and warrants to the
Administrative Agent and each other Secured Party that:
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4.2.1 Title; No Other Liens. Except for the security interest
granted to the Administrative Agent, for the ratable benefit of the Secured
Parties, pursuant to this Agreement and the other Liens permitted to exist on
such Grantor's Collateral by the Credit Agreement (including without limitation
subsection 8.3 thereof), such Grantor owns each item of such Grantor's
Collateral free and clear of any and all Liens. Except as set forth on Schedule
6, no financing statement or other similar public notice with respect to all or
any part of such Grantor's Collateral is on file or of record in any public
office, except such as have been filed in favor of the Administrative Agent, for
the ratable benefit of the Secured Parties, pursuant to this Agreement or as are
permitted by the Credit Agreement (including without limitation subsection 8.3
thereof) or any other Loan Document or for which termination statements will be
delivered on the Closing Date.
4.2.2 Perfected First Priority Liens. (i) This Agreement is
effective to create, as collateral security for the Obligations of such Grantor,
valid and enforceable Liens on such Grantor's Collateral in favor of the
Administrative Agent, for the benefit of the Secured Parties, except as
enforceability may be affected by bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting
creditor's rights generally, general equitable principles (whether considered in
a proceeding in equity or at law) and an implied covenant of good faith and fair
dealing.
(ii) Except with respect to (A) Liens on Equipment
constituting Fixtures, (B) any rights reserved in favor of the United States
government as required under law, (C) Liens upon Patents, Patent Licenses,
Trademarks and Trademark Licenses to the extent that (I) such Liens cannot be
perfected by the filing of financing statements under the Uniform Commercial
Code or by the filing and acceptance thereof in the United States Patent and
Trademark Office or (II) such Patents, Patent Licenses, Trademarks and Trademark
Licenses are not, individually or in the aggregate, material to the business of
the Borrower and its Subsidiaries taken as a whole, (D) Liens on uncertificated
securities, (E) Liens on Collateral the perfection of which requires filings in
or other actions under the laws of jurisdictions outside of the United States of
America, any State, territory or dependency thereof or the District of Columbia
(except to the extent that such filings or other actions have been made or
taken), (F) Liens on contracts or receivables on which the United States of
America or any department, agency, or instrumentality thereof is the obligor,
(G) Liens on Proceeds of receivables and Inventory, until transferred to or
deposited in the Collateral Proceeds Account (if any), and (H) claims of
creditors of Persons receiving goods included as Collateral for "sale or return"
within the meaning of Section 2-326 of the Uniform Commercial Code of the
applicable jurisdiction, upon filing of the financing statements delivered to
the Administrative Agent by such Grantor on the Effective Date in the
jurisdictions listed on Schedule 5.14 to the Credit Agreement (which financing
statements are in proper form for filing in such jurisdictions) and the
recording of the Mortgages (and the recording of any Patent and Trademark
Security Agreement, as set forth therein, and the making of filings after the
Effective Date in any other jurisdiction as may be necessary under any
Requirement of Law) and the
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delivery to, and continuing possession by, the Administrative Agent of all
Instruments, Chattel Paper and Documents a security interest in which is
perfected by possession, the Liens created pursuant to this Agreement will
constitute valid Liens on and, to the extent provided herein, perfected security
interests in such Grantor's Collateral (but as to the Copyrights and Copyright
Licenses and accounts arising therefrom, only to the extent the Uniform
Commercial Code of the relevant jurisdiction, from time to time in effect, is
applicable) in favor of the Administrative Agent for the benefit of the Secured
Parties, which Liens will be prior to all other Liens of all other Persons,
except for Liens permitted pursuant to the Loan Documents (including, without
limitation, those permitted to exist pursuant to subsection 8.3 of the Credit
Agreement), and which Liens are enforceable as such as against all other Persons
(except to the extent that the recording of an assignment or other transfer of
title to the Administrative Agent in the United States Patent and Trademark
Office may be necessary for enforceability, and except, with respect to goods
only, buyers in the ordinary course of business to the extent provided in
Section 9-307(1) of the Code), except as enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditors' rights generally and by general
equitable principles (whether enforcement is sought by proceedings in equity or
at law) or by an implied covenant of good faith and fair dealing.
4.2.3 Chief Executive Office. On the date hereof, such
Grantor's jurisdiction of organization and the location of such Grantor's chief
executive office or sole place of business are specified on Schedule 3.
4.2.4 Inventory and Equipment. On the date hereof, such
Grantor's Inventory and Equipment (other than mobile goods) are kept at the
locations listed on Schedule 4.
4.2.5 Farm Products. None of such Grantor's Collateral
constitutes, or is the Proceeds of, Farm Products.
4.2.6 Accounts. The amount represented by such Grantor to the
Administrative Agent or the other Secured Parties from time to time as owing by
each account debtor or by all account debtors in respect of such Grantor's
Accounts will at such time be the correct amount, in all material respects,
actually owing by such account debtor or debtors thereunder, except to the
extent that appropriate reserves therefor have been established on the books of
such Grantor in accordance with GAAP. The places where such Grantor keeps its
records concerning such Grantor's Accounts are listed on Schedule 7 or such
other location or locations of which such Grantor shall have provided prior
written notice to the Administrative Agent pursuant to Section 5.2.5 hereof.
Unless otherwise indicated in writing to the Administrative Agent, each Account
of such Grantor arises out of a bona fide sale and delivery of goods or
rendition of services by such Grantor. Such Grantor has not given any account
debtor any deduction in respect of the amount due under any such Account, except
as such Grantor may otherwise advise the Administrative Agent in writing.
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4.2.7 Intellectual Property. Schedule 5 lists all material
Trademarks and material Patents (including, without limitation, Trademarks and
Patents registered in the United States Patent and Trademark Office) owned by
such Grantor in its own name as of the date hereof and all material Trademark
Licenses and all material Patent Licenses (including, without limitation,
material Trademark Licenses for registered Trademarks and material Patent
Licenses for registered Patents) owned by such Grantor in its own name as of the
date hereof.
4.3 Representations and Warranties of Each Pledgor. 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
Borrower thereunder, each Pledgor hereby represents and warrants to the
Administrative Agent and each other Secured party that:
4.3.1 The shares of Pledged Stock pledged by such Pledgor
hereunder constitute (i) in the case of each Domestic Subsidiary, all the issued
and outstanding shares of all classes of the Capital Stock of each such Domestic
Subsidiary owned by such Pledgor and (ii) in the case of each Foreign Subsidiary
such percentage (not more than 65%) as is specified on Schedule 2 of all the
issued and outstanding shares of all classes of the Capital Stock of each such
Foreign Subsidiary.
4.3.2 All the shares of the Pledged Stock pledged by such
Pledgor hereunder have been duly and validly issued and are fully paid and
nonassessable.
4.3.3 Such Pledgor is the record and beneficial owner of, and
has good and valid title to, the Pledged Securities pledged by it hereunder,
free of any and all Liens or options in favor of, or claims of, any other
Person, except the security interest created by this Agreement and Liens imposed
by operation of law.
4.3.4 Upon delivery to the Administrative Agent of the
certificates evidencing the Pledged Securities held by such Pledgor, the
security interest created by this Agreement in such Pledged Collateral, assuming
the continuing possession of such Pledged Securities by the Administrative
Agent, will constitute a valid, perfected first priority security interest in
such Pledged Collateral to the extent provided in the Code, enforceable in
accordance with its terms against all creditors of such Pledgor and any persons
purporting to purchase such Pledged Collateral from such Pledgor, except as
enforceability may be affected by 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 in equity or at law) and an implied covenant of good faith and fair
dealing.
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SECTION 5. COVENANTS
5.1 Covenants of Each Guarantor. Each Guarantor covenants and
agrees with the Administrative Agent and the other Secured Parties that, from
and after the date of this Agreement until the Loans, any Reimbursement
Obligations, and all other Obligations then due and owing, shall have been paid
in full, no Letter of Credit shall be outstanding and the Commitments shall have
terminated, 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 Covenants of Each Grantor. Each Grantor covenants and
agrees with the Administrative Agent and the other Secured Parties that, from
and after the date of this Agreement until the Loans, any Reimbursement
Obligations, and all other Obligations then due and owing, shall have been paid
in full, no Letter of Credit shall be outstanding and the Commitments shall have
terminated:
5.2.1 Delivery of Instruments and Chattel Paper. If any amount
payable under or in connection with any of such Grantor's Collateral shall be or
become evidenced by any Instrument or Chattel Paper, such Instrument or Chattel
Paper shall be promptly delivered to the Administrative Agent, duly indorsed in
a manner satisfactory to the Administrative Agent, to be held as Collateral
pursuant to this Agreement.
5.2.2 Maintenance of Insurance. (a) Such Grantor will
maintain, with financially sound and reputable companies, insurance policies (i)
insuring such Grantor's Inventory and Equipment against loss by fire, explosion,
theft and such other casualties as may be reasonably satisfactory to the
Administrative Agent and (ii) insuring such Grantor, the Administrative Agent
and the other Secured Parties against liability for personal injury and property
damage relating to such Inventory and Equipment, such policies to be in such
form and amounts and having such coverage as may be reasonably satisfactory to
the Administrative Agent.
(b) All such insurance shall (i) provide that no cancellation,
material reduction in amount or material change in coverage thereof shall be
effective until at least 30 days after receipt by the Administrative Agent of
written notice thereof, (ii) name the Administrative Agent as an additional
insured party or loss payee, (iii) include deductibles consistent with past
practice or otherwise reasonably satisfactory to the Administrative Agent and
(iv) be reasonably satisfactory in all other respects to the Administrative
Agent.
(c) Such Grantor (if the Borrower) shall deliver to the
Administrative Agent and the other Secured Parties reports of one or more
reputable insurance brokers of the individual
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insurance companies with respect to such insurance as the Administrative Agent
may from time to time reasonably request.
5.2.3 Payment of Obligations. Such Grantor will pay and
discharge or otherwise satisfy at or before maturity or before they become
delinquent, as the case may be, all taxes, assessments and governmental charges
or levies imposed upon such Grantor's Collateral or in respect of income or
profits therefrom, as well as all claims of any kind (including, without
limitation, claims for labor, materials and supplies) against or with respect to
such Grantor's Collateral, except that no such tax, assessment, charge or levy
need be paid or satisfied if the amount or validity thereof is currently being
contested in good faith by appropriate proceedings, reserves in conformity with
GAAP with respect thereto have been provided on the books of such Grantor and
such proceedings would not reasonably be expected to result in the sale,
forfeiture or loss of any material portion of the Collateral or any interest
therein.
5.2.4 Maintenance of Perfected Security Interest; Further
Documentation. (a) Such Grantor shall maintain the security interest created by
this Agreement in such Grantor's Collateral as a perfected security interest
having at least the priority described in Section 4.2.2 and shall defend such
security interest against the claims and demands of all Persons whomsoever.
(b) Such Grantor will furnish to the Administrative Agent from
time to time statements and schedules further identifying and describing such
Grantor's Collateral and such other reports in connection with such Grantor's
Collateral as the Administrative Agent may reasonably request in writing, all in
reasonable detail.
(c) At any time and from time to time, upon the written
request of the Administrative Agent, and at the sole expense of such Grantor,
such Grantor will promptly and duly execute and deliver such further instruments
and documents and take such further actions as the Administrative Agent may
reasonably request for the purpose of obtaining or preserving the full benefits
of this Agreement and of the rights and powers herein granted by such Grantor,
including, without limitation, the filing of any financing or continuation
statements under the Uniform Commercial Code (or other similar laws) in effect
in any jurisdiction with respect to the security interests created hereby.
5.2.5 Changes in Locations, Name, etc. Such Grantor will not,
except upon not less than 30 days' prior written notice to the Administrative
Agent and delivery to the Administrative Agent, if applicable, of a written
supplement to Schedule 4 showing any additional location at which such Grantor's
Inventory or Equipment shall be kept:
(i) permit any of such Grantor's Inventory or Equipment to be
kept at a location other than the location(s) applicable to such
Grantor listed on Schedule 4 (other than
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Inventory or Equipment being conveyed, sold, leased, assigned,
transferred or otherwise disposed of as permitted by the Credit
Agreement);
(ii) change the location of its chief executive office or sole
place of business from that referred to in Section 4.2.3; or
(iii) change its name, identity or corporate structure to such
an extent that any financing statement filed by the Administrative
Agent in connection with this Agreement would become misleading;
provided that, prior to taking any such action, or promptly after receiving a
written request therefor from the Administrative Agent, such Grantor shall
deliver to the Administrative Agent all additional executed financing statements
and other documents reasonably requested by the Administrative Agent to maintain
the validity, perfection and priority of the security interests provided for
herein.
5.2.6 Notices. Such Grantor will advise the Administrative
Agent promptly, in reasonable detail, of:
(a) any Lien (other than security interests created hereby or
Liens permitted under the Credit Agreement) on any of such Grantor's Collateral
which would adversely affect the ability of the Administrative Agent to exercise
any of its remedies hereunder; and
(b) of the occurrence of any other event which could
reasonably be expected to have a material adverse effect on the aggregate value
of such Grantor's Collateral or on the security interests created hereby.
5.2.7 Pledged Securities. In the case of each Grantor which is
an Issuer, such Issuer agrees that (i) it will be bound by the terms of this
Agreement relating to the Pledged Stock issued by it and will comply with such
terms insofar as such terms are applicable to it, (ii) it will notify the
Administrative Agent promptly in writing of the occurrence of any of the events
described in Section 5.3.1 with respect to the Pledged Stock issued by it and
(iii) 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 Stock issued by it.
5.2.8 Accounts. (a) Other than in the ordinary course of
business, such Grantor will not (i) grant any extension of the time of payment
of any of such Grantor's Accounts, (ii) compromise or settle any such Account
for less than the full amount thereof, (iii) release, wholly or partially, any
Person liable for the payment of any Account, (iv) allow any credit or discount
whatsoever on any such Account or (v) amend, supplement or modify any Account in
any manner that could adversely affect the value thereof.
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(b) Such Grantor will deliver to the Administrative Agent a
copy of each material demand, notice or document received by it that questions
or calls into doubt the validity or enforceability of more than 10% of the
aggregate amount of the then outstanding Accounts.
5.2.9 Maintenance of Records. Such Grantor will keep and
maintain at its own cost and expense reasonably satisfactory and complete
records of its Collateral, including, without limitation, a record of all
payments received and all credits granted with respect to such Collateral, and
shall xxxx such records to evidence this Agreement and the Liens and the
security interests created hereby. For the Administrative Agent's and the other
Secured Parties' further security, the Administrative Agent, for the benefit of
the Secured Parties, shall have a security interest in all of such Grantor's
books and records pertaining to such Grantor's Collateral.
5.2.10 Acquisition of Intellectual Property. Within 45 days
after the end of each calendar quarter, such Grantor will notify the
Administrative Agent of any acquisition by such Grantor of (i) any material
registration of Copyright, Patent or Trademark or (ii) any exclusive rights
under a material Copyright License, Patent License or Trademark License, and
shall take such actions as may be reasonably requested by the Administrative
Agent (but only to the extent such actions are within such Grantor's control) to
perfect the security interest granted to the Administrative Agent and the other
Secured Parties therein (including, without limitation, (x) the execution and
delivery of a Patent and Trademark Security Agreement (or amendments to any such
agreement previously executed or delivered by such Grantor) or other comparable
agreements with respect to Copyrights or Copyright Licenses and (y) the making
of appropriate filings (I) of financing statements under the Uniform Commercial
Code of any applicable jurisdiction and/or (II) in the United States Patent and
Trademark Office, or with respect to Copyrights and Copyright Licenses, other
applicable office).
5.2.11 Protection of Trade Secrets. Such Grantor shall take
all steps which it deems commercially reasonable to preserve and protect the
secrecy of all material Trade Secrets of such Grantor.
5.3 Covenants of Each Pledgor. Each Pledgor covenants and
agrees with the Administrative Agent and the other Secured Parties that, from
and after the date of this Agreement until the Loans, any Reimbursement
Obligations, and all other Obligations then due and owing shall have been paid
in full, no Letter of Credit shall be outstanding and the Commitments shall have
terminated:
5.3.1 If such Pledgor shall become entitled to receive or
shall receive any stock certificate (including, without limitation, any
certificate representing a stock dividend or a distribution in connection with
any reclassification, increase or reduction of capital or any certificate issued
in connection with any reorganization), option or rights in respect of the
Capital Stock of any Issuer, whether in addition to, in substitution of, as a
conversion of, or in exchange
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for, any shares of the Pledged Stock, or otherwise in respect thereof, such
Pledgor shall accept the same as the agent of the Administrative Agent and the
other Secured Parties, hold the same in trust for the Administrative Agent and
deliver the same forthwith to the Administrative Agent in the exact form
received, duly indorsed by such Pledgor to the Administrative Agent, if
required, together with an undated stock power covering such certificate duly
executed in blank by such Grantor and with, if the Administrative Agent so
requests, signature guaranteed, to be held by the Administrative Agent, subject
to the terms hereof, as additional collateral security for the Obligations
(provided that in no event shall there be pledged, nor shall any Pledgor be
required to pledge, more than 65% of any series of the outstanding Capital Stock
of any Foreign Subsidiary pursuant to this Agreement). Any sums paid upon or in
respect of the Pledged Securities upon the liquidation or dissolution of any
Issuer or Maker (except any liquidation or dissolution of any Subsidiary of the
Borrower in accordance with the Credit Agreement) shall be paid over to the
Administrative Agent to be held by it hereunder as additional collateral
security for the Obligations, and in case any distribution of capital shall be
made on or in respect of the Pledged Stock or any property shall be distributed
upon or with respect to the Pledged Stock pursuant to the recapitalization or
reclassification of the capital of any Issuer or pursuant to the reorganization
thereof, the property so distributed shall, unless otherwise subject to a
perfected security interest in favor of the Administrative Agent, be delivered
to the Administrative Agent to be held by it hereunder as additional collateral
security for the Obligations. If any sums of money or property so paid or
distributed in respect of the Pledged Securities shall be received by such
Pledgor, such Pledgor shall, until such money or property is paid or delivered
to the Administrative Agent, hold such money or property in trust for the
Secured Parties, segregated from other funds of such Pledgor, as additional
collateral security for the Obligations.
5.3.2 Without the prior written consent of the Administrative
Agent, such Pledgor will not (except pursuant to a transaction permitted by the
Credit Agreement) (i) vote to enable, or take any other action to permit, any
Issuer to issue any stock or other equity securities of any nature or to issue
any other securities convertible into or granting the right to purchase or
exchange for any stock or other equity securities of any nature of any Issuer,
(ii) sell, assign, transfer, exchange, or otherwise dispose of, or grant any
option with respect to, the Pledged Securities or Proceeds thereof or (iii)
create, incur or permit to exist any Lien or option in favor of, or any claim of
any Person with respect to, any of the Pledged Securities or Proceeds thereof,
or any interest therein, except for the security interests created by this
Agreement or Liens arising by operation of law.
5.3.3 Such Pledgor shall maintain the security interest
created by this Agreement in such Pledgor's Pledged Collateral as a perfected
security interest having at least the priority described in Section 4.3.4 and
shall defend such security interest against the claims
and demands of all Persons whomsoever. At any time and from time to time, upon
the written request of the Administrative Agent, and at the sole expense of such
Pledgor, such Pledgor will promptly and duly execute and deliver such further
instruments and documents and take such further actions as
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the Administrative Agent may reasonably request for the purpose of obtaining or
preserving the full benefits of this Agreement and of the rights and powers
herein granted by such Pledgor.
5.4 Covenants of Holdings. Holdings covenants and agrees with
the Administrative Agent and the other Secured Parties that, from and after the
date of this Agreement until the Loans, any Reimbursement Obligations, and all
other Obligations then due and owing have been paid in full, no Letter of Credit
shall be outstanding and the Commitments shall have terminated:
5.4.1 Holdings shall not conduct or otherwise engage, in any
business or operations other than (i) transactions contemplated by the Loan
Documents or the provision of administrative, legal, accounting and management
services to or on behalf of the Borrower or any of its Subsidiaries, (ii) the
ownership of the Capital Stock of the Borrower (or any successor thereto), and
the exercise of rights and performance of obligations in connection therewith,
(iii) the entry into, and exercise of rights and performance of obligations in
respect of, (A) the Transaction Documents and Senior Subordinated Notes
Documents to which Holdings is a party, this Guarantee and Collateral Agreement
and the other Loan Documents to which Holdings is a party, and any other
agreement to which Holdings is a party on the date hereof, in each case as
amended, supplemented, waived or otherwise modified from time to time, and any
refinancings, refundings, renewals or extensions thereof, (B) contracts and
agreements with officers, directors and employees of the Holdings or a
Subsidiary thereof relating to their employment or directorships, (C) insurance
policies and related contracts and agreements, and (D) equity subscription
agreements, registration rights agreements, voting and other stockholder
agreements, engagement letters, underwriting agreements and other agreements in
respect of its equity securities or any offering, issuance or sale thereof, (iv)
the offering, issuance and sale of its equity securities, (v) the filing of
registration statements, and compliance with applicable reporting and other
obligations, under federal, state or other securities laws, (vi) the listing of
its equity securities and compliance with applicable reporting and other
obligations in connection therewith, (vii) the retention of transfer agents,
private placement agents, underwriters, counsel, accountants and other advisors
and consultants, (viii) the performance of obligations under and compliance with
its certificate of incorporation and by-laws, or any applicable law, ordinance,
regulation, rule, order, judgment, decree or permit, including, without
limitation, as a result of or in connection with the activities of the Borrower
and its Subsidiaries, (ix) the incurrence and payment of its operating and
business expenses and any taxes for which it may be liable, and (x) other
activities incidental or related to the foregoing. Holdings shall not make any
interest payment on the Subordinated Debentures With Warrants in cash that may
be made in kind.
5.4.2 Holdings shall not own, lease, manage or otherwise
operate any properties or assets (other than in connection with the activities
described in Section 5.4.1 above), or incur, create, assume or suffer to exist
any Indebtedness or Guarantee Obligations of Holdings (other
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than such as may be incurred, created or assumed or exist in connection with the
activities described in Section 5.4.1 above.
SECTION 6. REMEDIAL PROVISIONS
6.1 Certain Matters Relating to Accounts. (a) At any time and
from time to time after the occurrence and during the continuance of an Event of
Default, the Administrative Agent shall have the right to make test
verifications of the Accounts in any manner and through any medium that it
reasonably considers advisable, and the relevant Grantor shall furnish all such
assistance and information as the Administrative Agent may require in connection
with such test verifications. At any time and from time to time after the
occurrence and during the continuance of an Event of Default, upon the
Administrative Agent's reasonable request and at the expense of the relevant
Grantor, such Grantor shall cause independent public accountants or others
reasonably satisfactory to the Administrative Agent to furnish to the
Administrative Agent reports showing reconciliations, aging and test
verifications of, and trial balances for, the Accounts.
(b) The Administrative Agent hereby authorizes each Grantor to
collect such Grantor's Accounts and the Administrative Agent may curtail or
terminate said authority at any time after the occurrence and during the
continuance of an Event of Default. If required by the Administrative Agent at
any time after the occurrence and during the continuance of an Event of Default,
any Proceeds constituting collections of such Accounts, when collected by such
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 the Collateral Proceeds
Account established by such Grantor maintained under the sole dominion and
control of the Administrative Agent, subject to withdrawal by the Administrative
Agent for the account of the Secured Parties 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 and the other Secured Parties, segregated from other funds
of such Grantor. Each such deposit of Proceeds of Accounts shall be accompanied
by a report identifying in reasonable detail the nature and source of the
payments included in the deposit. All Proceeds constituting collections of
Accounts while held by the Collateral Account Bank (or by any Guarantor in trust
for the benefit of the Administrative Agent and the other Secured Parties) shall
continue to be collateral security for all of the Obligations and shall not
constitute payment thereof until applied as hereinafter provided. At any time
when an Event of Default has occurred and is continuing, at the Administrative
Agent's election, the Administrative Agent may apply all or any part of the
funds on deposit in the Collateral Proceeds Account established by the relevant
Grantor to the payment of the Obligations of such Grantor then due and owing,
such application to be made as set forth in Section 6.5 hereof. So long as no
Event of Default has occurred and is continuing, the funds on deposit in the
Collateral Proceeds Account shall be remitted as provided in Section 6.9 hereof.
At any time when an Event of Default has occurred and is continuing, at the
Administrative
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Agent's request, each Grantor shall deliver to the Administrative Agent all
original and other documents evidencing, and relating to, the agreements and
transactions which gave rise to such Grantor's Accounts, including, without
limitation, all statements relating to such Grantor's Accounts.
(c) At any time and from time to time after the occurrence and
during the continuance of an Event of Default, at the Administrative Agent's
request, each Grantor shall deliver to the Administrative Agent all original and
other documents evidencing, and relating to, the agreements and transactions
which gave rise to such Grantor's Accounts, including, without limitation, all
original orders, invoices and shipping receipts.
(d) General Fund Account. So long as no Event of Default has
occurred and is continuing, the Administrative Agent shall instruct the
Collateral Account Bank to promptly remit any funds on deposit in each Grantor's
Collateral Proceeds Account to such Grantor's General Fund Account. In the event
that an Event of Default has occurred and is continuing, the Administrative
Agent and the Grantors agree that the Administrative Agent, at its option, may
require that each Collateral Proceeds Account be established at The Chase
Manhattan Bank. Each Grantor shall have the right, at any time and from time to
time, to withdraw such of its own funds from its own General Fund Account, and
to maintain such balances in its General Fund Account, as it shall deem to be
necessary or desirable.
(e) Restructuring of Deposit Accounts. If (a) any Collateral
Proceeds Account is maintained at a Collateral Account Bank located in a state
within the United States in which Article 9 of the Uniform Commercial Code in
effect in such state has been expressly made applicable to (and only for so long
as it is applicable to) demand deposit accounts and all filings have been made
in such state which are necessary to perfect the Secured Parties' security
interest in such Collateral Proceeds Account or (b) after the Effective Date the
relevant Grantor demonstrates to the Administrative Agent, and the
Administrative Agent in its sole discretion agrees, that the costs associated
with maintaining both a Collateral Proceeds Account and a General Fund Account
outweigh any benefits to the Secured Parties in terms of any additional
protection to their rights in such Grantor's Collateral that could not be
achieved with the use of a single account, then upon the request of such
Grantor, the Administrative Agent may amend this Agreement to delete the
requirement that a separate General Fund Account be maintained and provide that
such Grantor be entitled to withdraw funds on deposit in such Collateral
Proceeds Account at any time so long as no Event of Default has occurred and is
continuing.
6.2 Communications with Obligors; Grantors Remain Liable. (a)
The Administrative Agent in its own name or in the name of others may at any
time and from time to time after the occurrence and during the continuance of an
Event of Default communicate with obligors under the Accounts and parties to the
Contracts (in each case, to the extent constituting
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Collateral) to verify with them to the Administrative Agent's satisfaction the
existence, amount and terms of any Receivables or Contracts.
(b) Upon the request of the Administrative Agent at any time
after the occurrence and during the continuance of an Event of Default, each
Grantor shall notify obligors on such Grantor's Accounts and parties to such
Grantor's Contracts (in each case, to the extent constituting Collateral) that
such Accounts and such Contracts have been assigned to the Administrative Agent,
for the ratable benefit of the Secured Parties, and that payments in respect
thereof shall be made directly to the Administrative Agent.
(c) Anything herein to the contrary notwithstanding, each
Grantor shall remain liable under each of such Grantor's Accounts 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 nor any Lender shall have any
obligation or liability under any Account (or any agreement giving rise thereto)
by reason of or arising out of this Agreement or the receipt by the
Administrative Agent or any other Secured Party of any payment relating thereto,
nor shall the Administrative Agent or any other Secured Party be obligated in
any manner to perform any of the obligations of any Grantor under or pursuant to
any Account (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 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 Stock. (a) Unless an Event of Default shall have
occurred and be continuing and the Administrative Agent shall have given notice
to the relevant Pledgor of the Administrative Agent's intent to exercise its
corresponding rights pursuant to Section 6.3(b), each Pledgor 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 Stock; provided, however, that no vote shall be cast or corporate
right exercised or such other action taken (other than in connection with a
transaction expressly permitted by the Credit Agreement) which, in the
Administrative Agent's reasonable judgment, would materially impair the Pledged
Collateral or the related rights or remedies of the Secured Parties or which
would be inconsistent with or result in any violation of any provision of the
Credit Agreement, this Agreement or any other Loan Document.
(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 Pledgor or Pledgors, (i) the Administrative Agent shall have the
right to receive any and all cash dividends, payments or other Proceeds paid in
respect of the Pledged Stock and make application thereof to the
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Obligations in such order as the Administrative Agent may determine, and (ii)
any or all of the Pledged Stock 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 Stock at any meeting of shareholders of the relevant Issuer or
Issuers or otherwise and (y) any and all rights of conversion, exchange,
subscription and any other rights, privileges or options pertaining to such
Pledged Stock as if it were the absolute owner thereof (including, without
limitation, the right to exchange at its discretion any and all of the Pledged
Stock upon the merger, consolidation, reorganization, recapitalization or other
fundamental change in the corporate structure of any Issuer, or upon the
exercise by the relevant Pledgor or the Administrative Agent of any right,
privilege or option pertaining to such Pledged Stock, and in connection
therewith, the right to deposit and deliver any and all of the Pledged Stock
with any committee, depositary, transfer agent, registrar or other designated
agency upon such terms and conditions as the Administrative Agent may reasonably
determine), all without liability (other than for its gross negligence or
willful misconduct) except to account for property actually received by it, but
the Administrative Agent shall have no duty to any Pledgor to exercise any such
right, privilege or option and shall not be responsible for any failure to do so
or delay in so doing, provided that the Administrative Agent shall not exercise
any voting or other consensual rights pertaining to the Pledged Stock in any way
that would constitute an exercise of the remedies described in Section 7 other
than in accordance with Section 7.
(c) Each Pledgor hereby authorizes and instructs each Issuer
or Maker of any Pledged Securities pledged by such Pledgor hereunder to (i)
comply with any instruction received by it from the Administrative Agent in
writing that (x) states that an Event of Default has occurred and (y) is
otherwise in accordance with the terms of this Agreement, without any other or
further instructions from such Pledgor, and each Pledgor agrees that each Issuer
or Maker shall be fully protected in so complying, and (ii) unless otherwise
expressly permitted hereby, pay any dividends or other payments with respect to
the Pledged Securities directly to the Administrative Agent.
6.4 Proceeds to be Turned Over To Administrative Agent. In
addition to the rights of the Administrative Agent and the other Secured Parties
specified in Section 6.1 with respect to payments of Accounts, if an Event of
Default shall occur and be continuing, and the Administrative Agent shall have
instructed any Grantor to do so, all Proceeds received by such Grantor
consisting of cash, checks and other Cash Equivalent items shall be held by such
Grantor in trust for the Administrative Agent and the other Secured Parties,
segregated from other funds of such Grantor, and shall, forthwith 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 the relevant Collateral Proceeds
Account maintained under its sole dominion and control. All Proceeds while held
by the Administrative Agent in such Collateral Proceeds Account (or by such
Grantor in trust for the Administrative Agent
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and the other Secured Parties) 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. It is agreed that if an Event of
Default shall occur and be continuing, any and all Proceeds of the relevant
Granting Party's Security Collateral received by the Administrative Agent
(whether from the relevant Granting Party or otherwise) shall be held by the
Administrative Agent for the benefit of the Secured Parties as collateral
security for the Obligations of the relevant Granting Party (whether matured or
unmatured), and/or then or at any time thereafter may, in the sole discretion of
the Administrative Agent, be applied by the Administrative Agent against the
Obligations of the relevant Granting Party then due and owing in the following
order of priority:
FIRST, to the payment of all reasonable costs and expenses
incurred by the Administrative Agent in connection with this Agreement,
the Credit Agreement, any other Loan Document or any of the Obligations
of the relevant Granting Party, including, without limitation, all
court costs and the reasonable fees and expenses of its agents and
legal counsel, and any other reasonable costs or expenses incurred in
connection with the exercise by the Administrative Agent of any right
or remedy under this Agreement, the Credit Agreement, or any other Loan
Document;
SECOND, to the ratable satisfaction of all other Obligations
of the relevant Granting Party; and
THIRD, to the relevant Granting Party or its successors or
assigns, 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 the Secured
Parties, 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 Code or any other applicable law. Without limiting the
generality of the foregoing, to the extent permitted by applicable law, 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) to or upon any Granting Party or any other
Person (all and each of which demands, defenses, advertisements and notices are
hereby waived), may in such circumstances forthwith collect, receive,
appropriate and realize upon the Security 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 Security 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 or any other Secured Party or elsewhere upon such terms and
conditions as it may deem advisable and at such prices as it may
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deem best, for cash or on credit or for future delivery without assumption of
any credit risk. The Administrative Agent or any other Secured Party shall have
the right upon any such public sale or sales, and, to the extent permitted by
law, upon any such private sale or sales, to purchase the whole or any part of
the Security Collateral so sold, free of any right or equity of redemption in
any Granting Party, which right or equity is hereby waived or released. Each
Granting Party further agrees, at the Administrative Agent's request, to
assemble the Security Collateral and make it available to the Administrative
Agent at places which the Administrative Agent shall reasonably select, whether
at such Granting Party'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 incurred in
connection therewith or incidental to the care or safekeeping of any of the
Security Collateral or in any way relating to the Security Collateral or the
rights of the Administrative Agent and the other Secured Parties hereunder,
including, without limitation, reasonable attorneys' fees and disbursements, to
the payment in whole or in part of the Obligations of the relevant Granting
Party, in the order of priority specified in Section 6.5 above, 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
9-504(1)(c) of the Code, need the Administrative Agent account for the surplus,
if any, to any Granting Party. To the extent permitted by applicable law, each
Granting Party waives all claims, damages and demands it may acquire against the
Administrative Agent or any other Secured Party arising out of the exercise by
them of any rights hereunder, except to the extent arising as a result of the
gross negligence or willful misconduct of the Administrative Agent or such other
Secured Party. 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 Registration Rights. (a) If the Administrative Agent shall
determine to exercise its right to sell any or all of the Pledged Stock pursuant
to Section 6.6, and if in the reasonable opinion of the Administrative Agent it
is necessary or reasonably advisable to have the Pledged Stock, or that portion
thereof to be sold, registered under the provisions of the Securities Act, the
relevant Pledgor will use its reasonable best efforts to cause the Issuer
thereof to (i) execute and deliver, and use its best efforts to cause the
directors and officers of such Issuer to execute and deliver, all such
instruments and documents, and do or cause to be done all such other acts as may
be, in the opinion of the Administrative Agent, necessary or advisable to
register such Pledged Stock, or that portion thereof to be sold, under the
provisions of the Securities Act, (ii) use its best efforts to cause the
registration statement relating thereto to become effective and to remain
effective for a period of one year from the date of the first public offering of
such Pledged Stock, or that portion thereof to be sold, and (iii) make all
amendments thereto and/or to the related prospectus which, in the reasonable
opinion of the Administrative Agent, are necessary or advisable, all in
conformity with the requirements of the Securities Act and the rules and
regulations of the Securities and Exchange Commission applicable thereto. Such
Pledgor agrees to cause such Issuer to comply with the provisions of the
securities or "Blue
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Sky" laws of any and all jurisdictions which the Administrative Agent shall
reasonably designate and to make available to its security holders, as soon as
practicable, an earnings statement (which need not be audited) which will
satisfy the provisions of Section 11(a) of the Securities Act.
(b) Such Pledgor recognizes that the Administrative Agent may
be unable to effect a public sale of any or all such 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. Such
Pledgor 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.
(c) Such Pledgor agrees to use its best efforts to do or cause
to be done all such other acts as may be necessary to make such sale or sales of
all or any portion of such Pledged Stock pursuant to this Section 6.7 valid and
binding and in compliance with any and all other applicable Requirements of Law.
Such Pledgor further agrees that a breach of any of the covenants contained in
this Section 6.7 will cause irreparable injury to the Administrative 20407326.01
Agent and the Lenders, that the Administrative Agent and the Lenders have no
adequate remedy at law in respect of such breach and, as a consequence, that
each and every covenant contained in this Section 6.7 shall be specifically
enforceable against such Pledgor, and to the extent permitted by applicable law,
such Pledgor hereby waives and agrees not to assert any defenses against an
action for specific performance of such covenants except for a defense that no
Event of Default has occurred under the Credit Agreement.
6.8 Waiver; Deficiency. Each Granting Party (other than the
Borrower) waives and agrees not to assert any rights or privileges which it may
acquire under Section 9-112 of the Code, to the extent permitted by applicable
law. Each Granting Party shall remain liable for any deficiency if the proceeds
of any sale or other disposition of the Security Collateral are insufficient to
pay its Obligations and the fees and disbursements of any attorneys employed by
the Administrative Agent or any other Secured Party to collect such deficiency.
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SECTION 7. THE ADMINISTRATIVE AGENT
7.1 Administrative Agent's Appointment as Attorney-in-Fact,
etc. (a) Each Granting Party 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 Granting Party and in the
name of such Granting Party 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 reasonably necessary
or desirable to accomplish the purposes of this Agreement to the extent
permitted by applicable law. Without limiting the generality of the foregoing,
at any time when an Event of Default has occurred and is continuing (in each
case to the extent permitted by applicable law), (x) each Pledgor hereby gives
the Administrative Agent the power and right, on behalf of such Pledgor, without
notice or assent by such Pledgor, to execute, in connection with any sale
provided for in Section 6.6 or 6.7, any indorsements, assessments or other
instruments of conveyance or transfer with respect to such Pledgor's Pledged
Collateral, and (y) 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:
(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 payment of moneys due under
any Account of such Grantor or with respect to any other Collateral of
such Grantor 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 Account of such Grantor or with respect to any
other Collateral of such Grantor whenever payable;
(ii) in the case of any Copyright, Patent or Trademark
constituting Collateral of such Grantor, execute and deliver any and
all agreements, instruments, documents and papers as the Administrative
Agent may reasonably request to evidence the Administrative Agent's and
the Lenders' security interest in such Copyright, Patent or Trademark
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 of such Grantor, 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; and
(iv) (i) direct any party liable for any payment under any of
the Collateral of such Grantor 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; (ii) ask or
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demand for, collect, 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 of such Grantor; (iii) 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 of such Grantor; (iv) commence and prosecute any suits,
actions or proceedings at law or in equity in any court of competent
jurisdiction to collect the Collateral of such Grantor or any portion
thereof and to enforce any other right in respect of any Collateral of
such Grantor; (v) defend any suit, action or proceeding brought against
such Grantor with respect to any Collateral of such Grantor; (vi)
settle, compromise or adjust any such suit, action or proceeding and,
in connection therewith, to give such discharges or releases as the
Administrative Agent may deem appropriate; (vii) subject to any
existing reserved rights or licenses, assign any Copyright, Patent or
Trademark constituting Collateral of such Grantor (along with the
goodwill of the business to which any such Copyright, Patent or
Trademark pertains), for such term or terms, on such conditions, and in
such manner, as the Administrative Agent shall in its sole discretion
determine; and (viii) generally, sell, transfer, pledge and make any
agreement with respect to or otherwise deal with any of the Collateral
of such Grantor 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 of such Grantor and the Administrative Agent's and the other
Secured Parties' security interests therein and to effect the intent of
this Agreement, all as fully and effectively as such Grantor might do.
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.
(b) If any Granting Party 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 perform or comply, or otherwise cause
performance or compliance, with such agreement.
(c) The reasonable expenses of the Administrative Agent
incurred in connection with actions undertaken as provided in this Section 7.1,
together with interest thereon at a rate per annum equal to the rate per annum
at which interest would then be payable on past due ABR Loans which are Term
Loans under the Credit Agreement, from the date of payment by the Administrative
Agent to the date reimbursed by the relevant Granting Party, shall be payable by
such Granting Party to the Administrative Agent on demand.
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(d) Each Granting Party 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 as to the relevant Granting Party until this
Agreement is terminated as to such Granting Party, and the security interests in
the Security Collateral of such Granting Party created hereby are released.
7.2 Duty of Administrative Agent. The Administrative Agent's
sole duty with respect to the custody, safekeeping and physical preservation of
the Security Collateral in its possession, under Section 9-207 of the Code or
otherwise, shall be to deal with it in the same manner as the Administrative
Agent deals with similar property for its own account. Neither the
Administrative Agent, any other Secured Party nor any of their respective
officers, directors, employees or agents shall be liable for failure to demand,
collect or realize upon any of the Security Collateral or for any delay in doing
so or shall be under any obligation to sell or otherwise dispose of any Security
Collateral upon the request of any Granting Party or any other Person or to take
any other action whatsoever with regard to the Security Collateral or any part
thereof. The powers conferred on the Administrative Agent and the other Secured
Parties hereunder are solely to protect the Administrative Agent's and the other
Secured Parties' interests in the Security Collateral and shall not impose any
duty upon the Administrative Agent or any other Secured Party to exercise any
such powers. The Administrative Agent and the other Secured Parties 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 Granting Party for any act or
failure to act hereunder, except for their own gross negligence or willful
misconduct.
7.3 Execution of Financing Statements. Pursuant to Section
9-402 of the Code and any other applicable law, each Granting Party authorizes
the Administrative Agent to file or record financing statements and other filing
or recording documents or instruments with respect to such Granting Party's
Security Collateral without the signature of such Granting Party 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. A photographic or other reproduction of this Agreement shall be
sufficient as a financing statement or other filing or recording document or
instrument for filing or recording in any jurisdiction.
7.4 Authority of Administrative Agent. Each Granting Party
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 or any amendment, supplement or other
modification of this Agreement shall, as between the Administrative Agent and
the Secured Parties, 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
32
38
and the Granting Parties the Administrative Agent shall be conclusively presumed
to be acting as agent for the Secured Parties with full and valid authority so
to act or refrain from acting, and no Granting Party shall be under any
obligation, or entitlement, to make any inquiry respecting such authority.
7.5 Right Of Inspection. Upon reasonable written advance
notice to any Grantor and at reasonable intervals, or at any time and from time
to time after the occurrence and during the continuation of an Event of Default,
the Administrative Agent shall have reasonable access during normal business
hours to all the books, correspondence and records of such Granting Party, and
the Administrative Agent and its representatives may examine the same, and to
the extent reasonable take extracts therefrom and make photocopies thereof, and
such Granting Party agrees to render to the Administrative Agent, at such
Granting Party's reasonable cost and expense, such clerical and other assistance
as may be reasonably requested with regard thereto. The Administrative Agent and
its representatives shall also have the right, upon reasonable advance written
notice to such Granting Party, to enter during normal business hours into and
upon any premises owned, leased or operated by such Granting Party where any of
such Granting Party's Inventory or Equipment is located for the purpose of
inspecting the same, observing its use or otherwise protecting its interests
therein.
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
by a written instrument executed by each affected Granting Party and the
Administrative Agent, provided that any provision of this Agreement imposing
obligations on any Granting Party may be waived by the Administrative Agent in a
written instrument executed by the Administrative Agent.
8.2 Notices. All notices, requests and demands to or upon the
Administrative Agent or any Granting Party hereunder shall be effected in the
manner provided for in subsection 11.2 of the Credit Agreement; 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, unless and
until such Guarantor shall change such address by notice to the Administrative
Agent given in accordance with subsection 11.2 of the Credit Agreement.
8.3 No Waiver by Course of Conduct; Cumulative Remedies.
Neither the Administrative Agent nor any other Secured Party 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 or any
other Secured Party, any right, power or privilege hereunder shall operate as a
waiver thereof.
33
39
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 or any other
Secured Party 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 or such
other Secured Party 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. (a) Each Guarantor
agrees to pay or reimburse each Secured Party and the Administrative Agent for
all their respective reasonable costs and expenses incurred in collecting
against such Guarantor under the guarantee contained in Section 2 or otherwise
enforcing or preserving any rights under this Agreement against such Guarantor
and the other Loan Documents to which such Guarantor is a party, including,
without limitation, the reasonable fees and disbursements of one firm of counsel
to the Secured Parties and the Administrative Agent.
(b) Each Guarantor agrees to pay, and to save the
Administrative Agent and the Secured Parties harmless from, (x) any and all
liabilities with respect to, or resulting from any delay in paying, any and all
stamp, excise, sales or other similar taxes which may be payable or determined
to be payable with respect to any of the Security Collateral or in connection
with any of the transactions contemplated by this Agreement and (y) 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 (collectively, the "indemnified liabilities"), in each case to the
extent the Borrower would be required to do so pursuant to Section 11.5 of the
Credit Agreement, and in any event excluding any taxes or other indemnified
liabilities arising from gross negligence or willful misconduct of the
Administrative Agent or any Secured Party.
(c) 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 and shall inure to the benefit of the Granting Parties, the Administrative
Agent and the Secured Parties and their respective successors and assigns;
provided that no Granting Party may assign, transfer or delegate any of its
rights or obligations under this Agreement without the prior written consent of
the Administrative Agent.
8.6 Set-Off. Each Guarantor hereby irrevocably authorizes the
Administrative Agent and each other Secured Party at any time and from time to
time without notice to such Guarantor, any other Guarantor or the Borrower, any
such notice being expressly waived by each Guarantor and by the Borrower, to the
extent permitted by applicable law, upon the occurrence
34
40
and during the continuance of an Event of Default under Section 9(a) of the
Credit Agreement and any amount remaining unpaid after it becomes due and
payable by such Guarantor hereunder, to set-off and appropriate and apply
against any such amount any and all deposits (general or special, time or
demand, provisional or final), 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 or such other Secured Party to or for the
credit or the account of such Guarantor, or any part thereof in such amounts as
the Administrative Agent or such other Secured Party may elect. The
Administrative Agent and each other Secured Party shall notify such Guarantor
promptly of any such set-off and the application made by the Administrative
Agent or such other Secured Party of the proceeds thereof; provided that the
failure to give such notice shall not affect the validity of such set-off and
application. The rights of the Administrative Agent and each other Secured Party
under this Section 8.6 are in addition to other rights and remedies (including,
without limitation, other rights of set-off) which the Administrative Agent or
such other Secured Party may have.
8.7 Counterparts. This Agreement may be executed by one or
more of the parties to this Agreement on any number of separate counterparts,
and all of said counterparts taken together shall be deemed to constitute one
and the same instrument.
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 entire agreement of the Granting Parties, the Administrative Agent
and the other Secured Parties with respect to the subject matter hereof, and
there are no promises, undertakings, representations or warranties by the
Granting Parties, the Administrative Agent or any other Secured Party relative
to subject matter hereof not expressly set forth or referred to herein or in the
other Loan Documents.
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.
35
41
8.12 Submission To Jurisdiction; Waivers. Each party hereto
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
judgement 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 party at its address referred to in Section 8.2 or at
such other address of which the Administrative Agent (in the case of
any other party hereto) or the Borrower (in the case of 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 punitive damages.
8.13 Acknowledgements. Each Guarantor 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 nor any other Secured
Party has any fiduciary relationship with or duty to any Guarantor
arising out of or in connection with this Agreement or any of the other
Loan Documents, and the relationship between the Guarantors, on the one
hand, and the Administrative Agent and the Secured Parties, on the
other hand, in connection herewith or therewith is solely that of
debtor and creditor; and
36
42
(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 Secured Parties or among the Guarantors
and the Secured Parties.
8.14 WAIVER OF JURY TRIAL. EACH PARTY HERETO 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.
8.15 Additional Granting Parties. Each new Domestic Subsidiary
of the Borrower that is required to become a party to this Agreement pursuant to
Section 8.15 of the Credit Agreement shall become a Granting Party for all
purposes of this Agreement upon execution and delivery by such Subsidiary of an
Assumption Agreement in the form of Annex 1 hereto.
8.16 Releases. (a) At such time as the Loans, the
Reimbursement Obligations and the other Obligations then due and owing shall
have been paid in full, the Commitments have been terminated and no Letters of
Credit shall be outstanding, all Security 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 Granting Party hereunder shall terminate, all without delivery of any
instrument or performance of any act by any party, and all rights to the
Security Collateral shall revert to the Granting Parties. At the request and
sole expense of any Granting Party following any such termination, the
Administrative Agent shall deliver to such Granting Party any Security
Collateral held by the Administrative Agent hereunder, and execute and deliver
to such Granting Party such documents (including without limitation UCC
termination statements) as such Granting Party shall reasonably request to
evidence such termination.
(b) In connection with the sale or other disposition of all of
the Capital Stock of any Guarantor or the sale or other disposition of Security
Collateral permitted under the Credit Agreement and the release of such
Guarantor from its Guarantee or the release of the Security Collateral subject
to such sale or other disposition, the Borrower shall deliver to the
Administrative Agent, a written request for release identifying such Guarantor
or the relevant Security Collateral and the terms of the sale or other
disposition in reasonable detail, including the price thereof and any expenses
in connection therewith, together with a certification by the Borrower stating
that such transaction is in compliance with the Credit Agreement and the other
Loan Documents. The Administrative Agent shall execute and deliver to the
relevant Granting Party (at the sole cost and expense of such Granting Party)
all releases or other documents (including without limitation UCC termination
statements) necessary or reasonably desirable for the release of the Liens
created hereby on such Security Collateral as such Granting Party may reasonably
request.
37
43
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.
TELEX COMMUNICATIONS, INC.
By: ____________________________
Name:
Title
TELEX COMMUNICATIONS GROUP, INC.
By: ____________________________
Name:
Title
TCI HOLDINGS CORP.
By: ____________________________
Name:
Title
Acknowledged and Agreed to as
of the date hereof by:
THE CHASE MANHATTAN BANK, as
Administrative Agent
By: _______________________________
Name:
Title:
39
44
Schedule 1
----------
NOTICE ADDRESSES OF GUARANTORS
Telex Communications Group, Inc.
c/o Telex Communications, Inc.
0000 Xxxxxxx Xxxxxx Xxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Xxxx X. Xxxxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
TCI Holdings Corp.
c/o Telex Communications, Inc.
0000 Xxxxxxx Xxxxxx Xxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Xxxx X. Xxxxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
with Copies to:
Greenwich Street Capital Partners, Inc.
000 Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
re: Telex Communications Group, Inc.
Attention: Xxxxxxxx X. Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
and
Debevoise & Xxxxxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxxxxxx, Esq.
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
45
Schedule 2
----------
DESCRIPTION OF PLEDGED SECURITIES
PLEDGED STOCK:
Stock Certificate
Issuer Class of Stock No. No. of Shares
----------------------------------- -------------- ----------------- -------------
Telex Communications, Inc. Common 2 500
Telex Communications (SEA) Common 5 130,000(1)
PTE, Ltd.
Telex Communications (U.K.) Common 4 3,250
Ltd.
Telex Communications, Ltd. Common C-2 6,500
TCI Holdings Corp. Common 1 65
--------------------
1. Notwithstanding the delivery of a stock certificate representing all of
the outstanding shares of common stock of Telex Communications (SEA)
PTE, Ltd., Telex has not pledged more than 65% of the common stock of
Telex Communications (SEA) PTE, Ltd. hereunder.
46
Schedule 3
----------
LOCATION OF JURISDICTION OF ORGANIZATION AND CHIEF
EXECUTIVE OFFICE OR SOLE PLACE OF BUSINESS
Granting Party Location
-------------- --------
Telex Communications Group, Inc. Jurisdiction of Organization:
Delaware
Chief Executive Office:
0000 Xxxxxxx Xxxxxx Xxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Telex Communications, Inc. As above.
TCI Holdings Corp. As above.
47
Schedule 4
----------
LOCATION OF INVENTORY AND EQUIPMENT
Granting Party Locations
-------- ---------------
Telex Communications Group, Inc. None
Telex Communications, Inc.
XXX Xxxxxxxx Xxxx. Xxxx
00
Schedule 5
----------
PATENTS AND PATENT LICENSES
TRADEMARKS AND TRADEMARK LICENSES
49
Schedule 6
----------
EXISTING PRIOR LIENS
I. Real Property Liens
A. 0000 Xxxxxxx Xxx. S., Bloomington, Hennepin County, MN
1. Subject to utility and drainage easements as shown on the
recorded plat at Document No. 1093227 (per recital on Certificate of Title).
2. Subject to an easement over the south 12 feet for driveway
purposes as shown in Deed Document No. 226740, Files of Registrar of Titles, and
together with an easement for driveway purposes as shown in Deed Document No.
28103, Files of Registrar of Titles (per recital on Certificate of Title).
3. Easement for storm sewer purposes in favor of the Village
of Bloomington created in Quit Claim Deeds dated February 27, 1957, filed May
15, 1957 as Document No. 529463, and dated February 14, 1957, filed August 2,
1957 as Document No. 535893.
4. Final Certificates dated September 15, 1958, filed October
30, 1958 as Document No. 574454, and dated February 14, 1962, filed April 3,
1962 as Document No. 687375.
5. Matters shown on the survey prepared by Westwood
Professional Service, Inc. on or about April 25, 1997.
6. Unrecorded Lease Agreement, dated July 5, 1988, between
Telex Communications, Inc. as lessor and Xxxxxxx Outdoor Advertising, Inc. as
Lessee.
7. Unrecorded Building Option and Lease Agreement, dated June
19, 1992, between Telex Communications, Inc. as lessor and SMSA Limited
Partnership as tenant.
X. Xxxx First St., Blue Earth, Faribault County, MN
1. Right to construct and maintain temporary snow fences in
favor of the State of Minnesota pursuant to Final Certificate dated September 9,
1932, filed September 12, 1932 in Book 88 of Deeds, Page 604.
2. Matters shown on the survey prepared by Westwood
Professional Service, Inc. on or about April 22, 1997.
00
X. Xxxxxx Xxxx, Xxx Xxxxx Xxxxx and Southcross Drive, Burnsville,
Dakota County, MN
1. Easement for public utility and roadway purposes in favor
of the City of Burnsville dated March 7, 1985, filed March 19, 1985 as Document
No. 145169.
2. Rights of the public in that portion of the subject
property embraced within County State Aid Highway No. 42.
3. Matters shown on the survey prepared by Westwood
Professional Service, Inc. on or about April 23, 1997.
D. 0000 Xxxx 00xx Xxxxxx, Xxxxxxx, XxXxxx Xxxxxx, XX
1. Reservation of utility easements in vacated streets and
avenues in favor of the City of Glencoe as contained in Resolutions filed
December 7, 1961, in Book 48 of Misc. Page 53, December 7, 1961 in Book 48 of
Misc., Page 54, and filed June 8, 1967 in Book 55 of Misc., Page 550.
2. Terms and conditions of Easement Agreement dated September
21, 1979, filed September 24, 1979 in Book 85 of Misc., page 79.
3. Matters shown on the survey prepared by Westwood
Professional Service, Inc. on or about April 25, 1997.
E. 000 Xxxxxxxxxxx Xxxxxx, LeSueur, XxXxxxx County, MN
1. Terms and conditions of Grant of Easement dated October 22,
1984, filed October 29, 1984 in Book 209 of Deeds, Page 134.
2. Matters shown on the survey prepared by Westwood
Professional Service, Inc. on or about April 16, 1997.
3. Unrecorded Lease, dated August 26, 1996, between Telex
Communications, Inc. as landlord and Xxxxxx Corporation d/b/a Great Papers, a
Minnesota corporation, as tenant.
F. 0000 Xxxxxxxxxx Xxxxx XX, Xxxxxxxxx, Xxxxxxx Xxxxxx, XX
2
51
1. Utility easement as shown on the recorded plat of Xxxx
Xxxxxxxx Industrial Park.
2. Terms and conditions of and easements created in instrument
dated October 4, 1982, filed October 4, 1982 in Book N-4 of Misc. Records, Page
716 as Document No. 447119, as modified by the provisions contained in Warranty
Deed dated October 4, 1982, filed October 4, 1982 in Book 382 of Deeds, Page 949
as Document No. 447163.
3. Matters shown on the survey prepared by Westwood
Professional Service, Inc. on or about April 25, 1997.
G. 0000 Xxxxxxxxxx Xxxxxxx, Xxxxxxx, Xxxxxxxxx Xxxxxx, XX
1. Easement for Right-of-Way to Lincoln Telephone & Telegraph
Company dated September 3, 1948, recorded September 23, 1948 in Book 35, Page
498, records of Lancaster County, Nebraska.
2. Easement to City of Lincoln, Nebraska dated February 23,
1954 recorded March 13, 1954 in Book 51, Page 69, records of Lancaster County,
Nebraska.
3. Right-of-Way Easement to River Public Power District dated
March 5, 1956 recorded April 24, 1956 in Book 59, Page 504; conveyed to Nebraska
Public Power District by Corporate Quitclaim Deed dated November 25, 1970,
recorded December 21, 1970 as Instrument number 70-14031, records of Lancaster
County, Nebraska.
4. Pipe Line Easement to Western Power & Gas Company dated
March 8, 1962 recorded April 23, 1962 in Book 87, Page 248, records of Lancaster
County, Nebraska.
5. Terms and conditions of Agreement by and between City of
Lincoln, Lancaster County, Nebraska, and Western Power & Gas Company, with
reference to Easements filed at Book 51, Page 69, and Book 87, Page 248; dated
June 18, 1962, recorded June 22, 1962 in Book 88, Page 91, records of Lancaster
County, Nebraska.
6. Easement for Electric Lines to Consumers Public Power
District dated October 5, 1962 recorded November 19, 1962 in Book 90, Page 85,
records of Lancaster County, Nebraska.
7. Easement for Electric Lines of Underground Electric to
Lincoln Electric System, Lincoln Telephone & Telegraph Company, dated April 21,
1983 recorded June 29, 1983 as Instrument Number 83-12246, records of Lancaster
County, Nebraska.
3
52
8. Ingress and Egress Restrictions shown in Quitclaim Deed
from the County of Lancaster to the State of Nebraska, dated August 19, 1980
recorded December 3, 1980 as Instrument Number 80-25116, records of Lancaster
County, Nebraska.
9. Any adverse claim based upon the assertion that: (a) some
portion of the land has been created by artificial means, or has accreted to
such portion so created, or (b) some portion of the land has been brought within
the boundaries thereof by any avulsive movement of the adjacent river, or has
been formed by any accretion to any such portion.
Any decrease in area, if any, of the land by erosion and the
consequences of any future change in the location of the adjacent river.
10. Terms and conditions of Notation pursuant to 40 C.F.R.
Subpart G executed by Telex Communications, Inc. dated January 9, 1990, recorded
January 11, 1990 as Instrument Number 90-1098, records of Lancaster County,
Nebraska.
11. Matters shown on the survey prepared by Xxxx Engineering,
Inc. on or about April 29, 1997.
II. UCC Liens
See attached chart.
4
53
Schedule 7
----------
ACCOUNTS
0000 Xxxxxxx Xxxxxx Xxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
54
Schedule 8
----------
CONTRACTS
None.
55
Annex 1 to
Guarantee and Collateral Agreement
ASSUMPTION AGREEMENT, dated as of _________ __, 199_, made by
______________________________, a ______________ corporation (the "Additional
Granting Party"), in favor of THE CHASE MANHATTAN BANK, as administrative agent
(in such capacity, the "Administrative Agent") for the banks and other financial
institutions (the "Lenders") from time to time parties to the Credit Agreement
referred to below and the other Secured Parties (as defined below). All
capitalized terms not defined herein shall have the meaning ascribed to them in
such the Guarantee and Collateral Agreement referred to below, or if not defined
therein, in Credit Agreement.
W I T N E S S E T H :
WHEREAS, GST Acquisition Corp., a Delaware corporation (the
"Borrower"), the Lenders and the Administrative Agent are parties to a Credit
Agreement, dated as of May 6, 1997 (as amended, supplemented or otherwise
modified from time to time, the "Credit Agreement");
WHEREAS, in connection with the Credit Agreement, the Borrower
and Telex Communications Group, Inc. ("Holdings") are, or are to become, parties
to the Guarantee and Collateral Agreement, dated as of May 6, 1997 (as amended,
supplemented or otherwise modified from time to time, the "Guarantee and
Collateral Agreement") in favor of the Administrative Agent, for the ratable
benefit of the Secured Parties (as defined in the Guarantee and Collateral
Agreement);
WHEREAS, the Additional Grantor is a member of an affiliated
group of companies that includes the Borrower and the other Granting Party to
the Guarantee and Collateral Agreement; the proceeds of the extensions of credit
under the Credit Agreement will be used in part to enable the Borrower to make
valuable transfers to one or more of the other Granting Parties (including the
Additional Grantor) in connection with the operation of their respective
businesses; and the Borrower and the other Granting Parties (including the
Additional Grantor) are engaged in related businesses, and each such Granting
Party (including the Additional Grantor) will derive substantial direct and
indirect benefit from the making of the extensions of credit under the Credit
Agreement;
WHEREAS, the Credit Agreement requires the Additional Granting
Party to become a party to the Guarantee and Collateral Agreement; and
WHEREAS, the Additional Granting Party 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:
56
1. Guarantee and Collateral Agreement. By executing and
delivering this Assumption Agreement, the Additional Granting Party, as provided
in Section 8.15 of the Guarantee and Collateral Agreement, hereby becomes a
party to the Guarantee and Collateral Agreement as a Granting Party thereunder
with the same force and effect as if originally named therein as a Guarantor [,
Grantor and Pledgor] [and Grantor] [and Pledgor]1 and, without limiting the
generality of the foregoing, hereby expressly assumes all obligations and
liabilities of a Guarantor [, Grantor and Pledgor] [and Grantor] [and Pledgor]2
thereunder. The information set forth in Annex 1-A hereto is hereby added to the
information set forth in Schedules ____________ to the Guarantee and Collateral
Agreement, and such Schedules are hereby amended and modified to include such
information. The Additional Granting Party hereby represents and warrants that
each of the representations and warranties of such Additional Grantor, in its
capacities as a Guarantor [, Grantor and Pledgor] [and Grantor] [and Pledgor],3
contained in Section 4 of the Guarantee and Collateral Agreement is true and
correct in all material respects on and as 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 GRANTING PARTY]
By: ________________________________
Name:
Title:
_________________________
1. Indicate the capacities in which the Additional Grantor is becoming a
Granting Party.
2. Indicate the capacities in which the Additional Grantor is becoming a
Granting Party.
3. Indicate the capacities in which the Additional Grantor is becoming a
Granting Party.
2
57
Annex 1-A to
Assumption Agreement
--------------------
58
TABLE OF CONTENTS
Page
----
SECTION 1. DEFINED TERMS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.1 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.2 Other Definitional Provisions . . . . . . . . . . . . . . . . . . . . . . . . . 8
SECTION 2. GUARANTEE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
2.1 Guarantee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
2.2 Right of Contribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
2.3 No Subrogation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
2.4 Amendments, etc. with respect to the Borrower Obligations . . . . . . . . . . . 10
2.5 Guarantee Absolute and Unconditional . . . . . . . . . . . . . . . . . . . . . 11
2.6 Reinstatement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
2.7 Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 3. GRANT OF SECURITY INTEREST . . . . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 4. REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . . . . . . . . . . . . . 14
4.1 Representations and Warranties of Each Guarantor. . . . . . . . . . . . . . . . 14
4.2 Representations and Warranties of Each Grantor . . . . . . . . . . . . . . . . 14
4.2.1 Title; No Other Liens . . . . . . . . . . . . . . . . . . . . . . . . . 14
4.2.2 Perfected First Priority Liens . . . . . . . . . . . . . . . . . . . . 14
4.2.3 Chief Executive Office . . . . . . . . . . . . . . . . . . . . . . . . . 16
4.2.4 Inventory and Equipment . . . . . . . . . . . . . . . . . . . . . . . . 16
4.2.5 Farm Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
4.2.6 Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
4.2.7 Intellectual Property . . . . . . . . . . . . . . . . . . . . . . . . . 16
4.3 Representations and Warranties of Each Pledgor . . . . . . . . . . . . . . . . 16
SECTION 5. COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
5.1 Covenants of Each Guarantor . . . . . . . . . . . . . . . . . . . . . . . . . . 17
5.2 Covenants of Each Grantor . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
5.2.1 Delivery of Instruments and Chattel Paper . . . . . . . . . . . . . . . 18
5.2.2 Maintenance of Insurance . . . . . . . . . . . . . . . . . . . . . . . 18
5.2.3 Payment of Obligations . . . . . . . . . . . . . . . . . . . . . . . . 18
5.2.4 Maintenance of Perfected Security Interest; Further Documentation . . . 19
5.2.5 Changes in Locations, Name, etc. . . . . . . . . . . . . . . . . . . . 19
5.2.6 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
5.2.7 Pledged Securities . . . . . . . . . . . . . . . . . . . . . . . . . . 20
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5.2.8 Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
5.2.9 Maintenance of Records . . . . . . . . . . . . . . . . . . . . . . . . 21
5.2.10 Acquisition of Intellectual Property . . . . . . . . . . . . . . . . . 21
5.2.11 Protection of Trade Secrets . . . . . . . . . . . . . . . . . . . . . . 21
5.3 Covenants of Each Pledgor . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
5.4 Covenants of Holdings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 6. REMEDIAL PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
6.1 Certain Matters Relating to Accounts . . . . . . . . . . . . . . . . . . . . . 24
6.2 Communications with Obligors; Grantors Remain Liable . . . . . . . . . . . . . 26
6.3 Pledged Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
6.4 Proceeds to be Turned Over To Administrative Agent . . . . . . . . . . . . . . 28
6.5 Application of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
6.6 Code and Other Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
6.7 Registration Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
6.8 Waiver; Deficiency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
SECTION 7. THE ADMINISTRATIVE AGENT . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
7.1 Administrative Agent's Appointment as Attorney-in-Fact, etc . . . . . . . . . . 31
7.2 Duty of Administrative Agent . . . . . . . . . . . . . . . . . . . . . . . . . 33
7.3 Execution of Financing Statements . . . . . . . . . . . . . . . . . . . . . . . 34
7.4 Authority of Administrative Agent . . . . . . . . . . . . . . . . . . . . . . . 34
7.5 Right Of Inspection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
SECTION 8. MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
8.1 Amendments in Writing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
8.2 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
8.3 No Waiver by Course of Conduct; Cumulative Remedies . . . . . . . . . . . . . . 35
8.4 Enforcement Expenses; Indemnification . . . . . . . . . . . . . . . . . . . . . 35
8.5 Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
8.6 Set-Off . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
8.7 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
8.8 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
8.9 Section Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
8.10 Integration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
8.11 GOVERNING LAW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
8.12 Submission To Jurisdiction; Waivers . . . . . . . . . . . . . . . . . . . . . . 37
8.13 Acknowledgements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
8.14 WAIVER OF JURY TRIAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
8.15 Additional Granting Parties . . . . . . . . . . . . . . . . . . . . . . . . . . 38
8.16 Releases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
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