EXHIBIT 4.3
SECURITY AGREEMENT
SECURITY AGREEMENT (this "Agreement") dated as of January 6, 2006 by
and among each of the undersigned, having a place of business at 0000
Xxxxxxxxxx Xxxxxxxxx, Xxxxxxxxxxxx, Xxxxxxx, 00000 (individually, a
"Grantor" and collectively, the "Grantors"), and BACK BAY CAPITAL FUNDING
LLC, a Delaware limited liability company, as collateral agent (in such
capacity, the "Collateral Agent" for the Secured Parties (as defined
herein), in consideration of the mutual covenants contained herein and
benefits to be derived herefrom.
WITNESSETH:
Reference is made to that certain Credit Agreement dated as of even date
herewith (as the same may be amended, modified, supplemented or restated
hereafter, the "Credit Agreement") by, among others, (i) the Grantors, as
Borrowers, (ii) the Lenders named therein, and (iii) Back Bay Capital Funding
LLC, as Administrative Agent and Collateral Agent for the Lenders.
The Lenders have agreed to make a Term Loan to the Borrowers pursuant to,
and upon the terms and subject to the conditions specified in, the Credit
Agreement. The obligation of the Lenders to make the Term Loan is conditioned
on, among other things, the execution and delivery by the Grantors of an
agreement in the form hereof to secure the Obligations.
Accordingly, the Grantors and the Collateral Agent, on behalf of itself
and each other Secured Party (and each of their respective successors and
assigns) hereby agree as follows:
ARTICLE 1
Definitions
1.1 Generally. Unless the context otherwise requires, all capitalized
terms used but not defined herein shall have the meanings set forth in the
Credit Agreement, and all references to the UCC shall mean the Uniform
Commercial Code as in effect from time to time in the State of New York;
provided, however, that if a term is defined in Article 9 of the UCC differently
that in another Article thereof, the term shall have the meaning set forth in
Article 9, and provided further that if by reason of mandatory provisions of
law, perfection, or the effect of perfection or non-perfection, of the Security
Interest in any Collateral or the availability of any remedy hereunder is
governed by the Uniform Commercial Code as in effect in a jurisdiction other
than New York, "UCC" means the Uniform Commercial Code as in effect in such
other jurisdiction for purposes of the provisions hereof relating to such
perfection or effect of perfection or non-perfection or availability of such
remedy, as the case may be.
1.2 Definition of Certain Terms Used Herein. As used herein, the
following terms shall have the following meanings:
"Accessions" shall have the meaning given that term in the UCC.
"Account Debtor" shall have the meaning given that term in the UCC.
"Accounts" shall include, without limitation, "accounts" as defined in the
UCC, and also all: accounts, accounts receivable, receivables, and rights to
payment (whether or not earned by performance) for: (i) property that has been
or is to be sold, leased, licensed, assigned, or otherwise disposed of; (ii)
services rendered or to be rendered; (iii) a policy of insurance issued or to be
issued; (iv) a secondary obligation incurred or to be incurred; or (v) arising
out of the use of a credit or charge card or information contained on or used
with that card. The term "Accounts" shall also include Health-Care-Insurance
Receivables.
"Blue Sky Laws" shall have the meaning assigned to such term in Section
6.1 of this Agreement.
"Chattel Paper" shall have the meaning given that term in the UCC.
"Collateral" shall mean all personal and fixture property of each Grantor,
including, without limitation, all: (a) Accounts, (b) Chattel Paper, (c)
Commercial Tort Claims, (d) Deposit Accounts, (e) Documents, (f) Equipment, (g)
Fixtures, (h) General Intangibles (including Payment Intangibles), (i) Goods,
(j) Instruments, (k) Inventory, (l) Investment Property, (m) Letter-of-Credit
Rights, (n) Software, (o) Supporting Obligations, (p) money, policies and
certificates of insurance, deposits, cash, or other property, (q) all books,
records, and information relating to any of the foregoing and/or to the
operation of any Grantor's business, and all rights of access to such books,
records, and information, and all property in which such books, records, and
information are stored, recorded and maintained, (r) all insurance proceeds,
refunds, and premium rebates, including, without limitation, proceeds of fire
and credit insurance, whether any of such proceeds, refunds, and premium rebates
arise out of any of the foregoing ((a) through (q)) or otherwise, (s) all liens,
guaranties, rights, remedies, and privileges pertaining to any of the foregoing
((a) through (r)), including the right of stoppage in transit, and (t) any of
the foregoing whether now owned or now due, or in which any Grantor has an
interest, or hereafter acquired, arising, or to become due, or in which any
Grantor obtains an interest, and all products, Proceeds, substitutions, and
Accessions of or to any of the foregoing.
"Collateral Agent's Rights and Remedies" shall have the meaning assigned
to such term in Section 8.8.
"Commercial Tort Claim" shall have the meaning given that term in the UCC.
"Credit Agreement" shall have the meaning assigned to such term in the
preliminary statement of this Agreement.
"Deposit Account" shall have the meaning given that term in the UCC and
shall also include all demand, time, savings, passbook, or similar accounts
maintained with a bank or other financial institution.
"Documents" shall have the meaning given that term in the UCC.
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"Equipment" shall include, without limitation, "equipment" as defined in
the UCC, and also all furniture, store fixtures, motor vehicles, rolling stock,
machinery, office equipment, plant equipment, tools, dies, molds, and other
goods, property, and assets which are used and/or were purchased for use in the
operation or furtherance of a Grantors' business, and any and all Accessions or
additions thereto, and substitutions therefor.
"Financing Statement" shall have the meaning given that term in the UCC.
"Fixture Filing" shall have the meaning given that term in the UCC.
"General Intangibles" shall have the meaning given that term in the UCC,
and shall also include, without limitation, all: Payment Intangibles; rights to
payment for credit extended; deposits; amounts due to any Grantor; credit
memoranda in favor of any Grantor; warranty claims; tax refunds and abatements;
insurance refunds and premium rebates; all means and vehicles of investment or
hedging, including, without limitation, options, warrants, and futures
contracts; records; customer lists; telephone numbers; goodwill; causes of
action; judgments; payments under any settlement or other agreement; literary
rights; rights to performance; royalties; license and/or franchise fees; rights
of admission; licenses; franchises; license agreements, including all rights of
any Grantor to enforce same; permits, certificates of convenience and necessity,
and similar rights granted by any governmental authority; internet addresses and
domain names; developmental ideas and concepts; proprietary processes;
blueprints, drawings, designs, diagrams, plans, reports, and charts; catalogs;
technical data; computer software programs (including the source and object
codes therefor), computer records, computer software, rights of access to
computer record service bureaus, service bureau computer contracts, and computer
data; tapes, disks, semi-conductors chips and printouts; user, technical
reference, and other manuals and materials; patents, patent applications and
patents pending; trade secret rights, copyrights, copyright applications, mask
work rights and interests, and derivative works and interests; trade names,
trademarks, trademark applications, service marks, and service xxxx
applications, together with all goodwill connected with and symbolized by any of
the foregoing; all other general intangible property of any Grantor in the
nature of intellectual property; proposals; cost estimates, and reproductions on
paper, or otherwise, of any and all concepts or ideas, and any matter related
to, or connected with, the design, development, manufacture, sale, marketing,
leasing, or use of any or all property produced, sold, or leased, by or credit
extended or services performed, by any Grantor, whether intended for an
individual customer or the general business of any Grantor, or used or useful in
connection with research by any Grantor.
"Goods" shall have the meaning given that term in the UCC.
"Health-Care-Insurance Receivables" shall have the meaning given that term
in the UCC, and shall also mean an interest in, or claim under, a policy of
insurance or otherwise which is a right to payment of a monetary obligation for
health-care goods or services provided.
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"Indemnitee" shall have the meaning assigned to such term in Section 8.6
of this Agreement.
"Instruments" shall have the meaning given that term in the UCC.
"Inventory" shall have the meaning given that term in the UCC, and shall
also include, without limitation, all: (a) Goods which (i) are leased by a
Person as lessor, (ii) are held by a Person for sale or lease or to be furnished
under a contract of service, (iii) are furnished by a Person under a contract of
service, or (iv) consist of raw materials, work in process, or materials used or
consumed in a business; (b) Goods of said description in transit; (c) Goods of
said description which are returned, repossessed and rejected; (d) packaging,
advertising, and shipping materials related to any of the foregoing; (e) all
names, marks, and General Intangibles affixed or to be affixed thereto or
associated therewith; and (f) Documents which represent any of the foregoing.
"Investment Property" shall have the meaning given that term in the UCC.
"Letter-of-Credit Right" shall have the meaning given that term in the UCC
and shall also mean any right to payment or performance under a letter of
credit, whether or not the beneficiary has demanded or is at the time entitled
to demand payment or performance.
"Payment Intangible" shall have the meaning given that term in the UCC,
and shall also refer to any General Intangible under which the Account Debtor's
primary obligation is a monetary obligation.
"Proceeds" shall include, without limitation, "Proceeds" as defined in the
UCC and each type of property described in the definition of Collateral.
"Secured Parties" shall mean (a) the Lenders, (b) the Agents and their
Affiliates, (c) the beneficiaries of each indemnification obligation undertaken
by any Grantor under any Loan Document, (d) Back Bay Capital Funding LLC and any
of its Affiliates with respect to any transaction entered into by any Grantor
with any such Person which arises out of any cash management, depository,
investment, letter of credit, Hedging Agreement, or other banking or financial
services provided by any such Person, (e) any other Person to whom Obligations
under the Credit Agreement and other Loan Documents are owing, and (f) the
successors and assigns of each of the foregoing.
"Securities Act" shall have the meaning assigned to such term in Section
6.1 of this Agreement.
"Security" shall have the meaning given that term in the UCC.
"Security Interest" shall have the meaning assigned to such term in
Section 2.1 of this Agreement.
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"Software" shall have the meaning given that term in the UCC.
"Supporting Obligation" shall have the meaning given that term in the UCC
and shall also refer to a Letter-of-Credit Right or secondary obligation that
supports the payment or performance of an Account, Chattel Paper, a Document, a
General Intangible, an Instrument, or Investment Property.
1.3 Rules of Interpretation. The rules of interpretation specified in
Section 1.02 of the Credit Agreement shall be applicable to this Agreement.
ARTICLE 2
Security Interest
2.1 Security Interest. As security for the payment or performance, as
the case may be, in full of the Obligations, each Grantor hereby bargains,
assigns, mortgages, pledges, hypothecates and transfers to the Collateral Agent,
its successors and assigns, for the benefit of the Secured Parties, and hereby
grants to the Collateral Agent, its successors and assigns, for the benefit of
the Secured Parties, a security interest in, all of such Grantor's right, title
and interest in, to and under the Collateral (the "Security Interest"). Without
limiting the foregoing, each Grantor hereby designates the Collateral Agent as
such Grantor's true and lawful attorney, exercisable by the Collateral Agent
whether or not an Event of Default exists, with full power of substitution, at
the Collateral Agent's option, for the purpose of filing one or more Financing
Statements (including Fixture Filings), continuation statements, or to sign
other documents for the purpose of perfecting, confirming, continuing, enforcing
or protecting the Security Interest granted by each Grantor, without the
signature of any Grantor (each Grantor hereby appointing the Collateral Agent as
such Person's attorney to sign such Person's name to any such instrument or
document, whether or not an Event of Default exists), and naming any Grantor or
the Grantors as debtors and the Collateral Agent as secured party.
2.2 No Assumption of Liability. The Security Interest is granted as
security only and shall not subject the Collateral Agent or any other Secured
Party to, or in any way alter or modify, any obligation or liability of any
Grantor with respect to or arising out of the Collateral.
ARTICLE 3
Representations and Warranties
The Grantors jointly and severally represent and warrant to the Collateral
Agent and the other Secured Parties that:
3.1 Representations and Warranties Incorporated by Reference. Each
Grantor hereby makes each of the representations and warranties set forth in
Article III of the Credit Agreement with respect to such Grantor as a Loan
Party. Each such warranty and representation is incorporated herein by
reference.
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3.2 Title and Authority. Each Grantor has good and valid rights in, and
title to, the Collateral with respect to which it has purported to grant a
Security Interest hereunder and has full power and authority to grant to the
Collateral Agent the Security Interest in such Collateral pursuant hereto and to
execute, deliver and perform its obligations in accordance with the terms of
this Agreement, without the consent or approval of any other Person other than
any consent or approval which has been obtained.
3.3 Filings. Financing Statements (including Fixture Filings, as
applicable) or other appropriate filings, recordings or registrations containing
a description of the Collateral have been filed in each governmental, municipal
or other office as is necessary to publish notice of and protect the validity of
and to establish a legal, valid and perfected security interest in favor of the
Collateral Agent (for the benefit of the Secured Parties) in respect of all
Collateral in which the Security Interest may be perfected by filing, recording
or registration in the United States (or any political subdivision thereof) and
its territories and possessions, and no further or subsequent filing, refiling,
recording, rerecording, registration or re-registration is necessary in any such
jurisdiction, except as provided under Applicable Law with respect to the filing
of continuation statements and except with respect to the acquisition by any
Grantor of any property for which additional filings or recordings are
necessary.
3.4 Validity and Priority of Security Interest. The Security Interest
constitutes (a) a legal and valid security interest in all of the Collateral
securing the payment and performance of the Obligations, and (b) subject to the
filings described in Section 3.3 above, a perfected security interest in all of
the Collateral. The Security Interest is and shall be prior to any other Lien on
any of the Collateral, subject only to the Liens under the Senior Credit
Facility Documents and those Permitted Encumbrances which have priority under
Applicable Law.
3.5 Absence of Other Liens. The Collateral is owned by the Grantors free
and clear of any Lien, except for Liens expressly permitted pursuant to Section
6.02 of the Credit Agreement. Except as provided in the Loan Documents, the
Grantors have not filed or consented to the filing of (a) any Financing
Statement or analogous document under the UCC or any other Applicable Law
covering any Collateral, (b) any assignment in which any Grantor assigns any
Collateral or any security agreement or similar instrument covering any
Collateral with the United States Patent and Trademark Office or the United
States Copyright Office or (c) any assignment in which any Grantor assigns any
Collateral or any security agreement or similar instrument covering any
Collateral with any foreign governmental, municipal or other office, which
Financing Statement or analogous document, assignment, security agreement or
similar instrument is still in effect, except, in each case, for Liens expressly
permitted pursuant to Section 6.02 of the Credit Agreement.
3.6 Bailees, Warehousemen, Etc. No Inventory of any Grantor is in the
care or custody of any third party or stored or entrusted with a bailee or other
third party. If any such Inventory shall hereafter be placed under such care,
custody, storage or entrustment of such third party or bailee, the Grantors
shall notify the Collateral Agent and at the request of the Collateral
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Agent, shall use best and good faith efforts to obtain a waiver or other
agreement by such third party or bailee reasonably satisfactory to the
Collateral Agent.
3.7 Consignments. No Grantor has, and none shall have, possession of any
property on consignment.
ARTICLE 4
Covenants
4.1 Covenants Incorporated by Reference. Each Grantor hereby covenants
and agrees that each Grantor shall perform, observe and otherwise comply with
the covenants set forth in Articles V and VI of the Credit Agreement with
respect to such Grantor as a Loan Party.
4.2 Change of Name; Location of Collateral; Records; Place of Business.
(a) Each Grantor agrees promptly to notify the Collateral Agent of
(i) any change in its legal name or in any trade name used to identify it
in the conduct of its business or in the ownership of its properties, (ii)
any change in the location of its chief executive office, its principal
place of business, any office in which it maintains books or records
relating to Collateral owned by it, or any office or facility at which
Collateral owned by it is located, including the establishment of any such
new office or facility, (iii) any change in its identity or organizational
structure, (iv) any change in its Federal Taxpayer Identification Number
or organizational number, if any, assigned to it by its state of
organization, or (v) the acquisition by any Grantor of any property for
which additional filings or recordings are necessary to perfect and
maintain the Collateral Agent's Security Interest therein. Upon receipt of
such notice, Collateral Agent shall promptly make all filings under the
UCC or otherwise that are required in order for the Collateral Agent to
continue at all times following such change to have a valid, legal and
perfected first priority security interest in all of the Collateral, and
each Grantor agrees not to effect or permit any change referred to in the
preceding sentence until all such filings have been made by the Collateral
Agent.
(b) Each Grantor agrees to maintain, at its own cost and expense,
such complete and accurate records with respect to the Collateral owned by
it as is consistent with its current practices, but in any event to
include complete accounting records indicating all payments and proceeds
received with respect to any part of the Collateral, and, at such time or
times as the Collateral Agent may reasonably request, promptly to prepare
and deliver to the Collateral Agent a duly certified schedule or schedules
in form and detail reasonably satisfactory to the Collateral Agent showing
the identity, amount and location of any and all Collateral.
4.3 Protection of Security. Each Grantor shall, at its own cost and
expense, take any and all actions reasonably necessary to defend title to the
Collateral against all Persons and to
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defend the Security Interest of the Collateral Agent in the Collateral and the
priority thereof against any Lien not expressly permitted pursuant to Section
6.02 of the Credit Agreement.
4.4 Further Assurances. Each Grantor agrees, at its own expense, to
execute, acknowledge, deliver and cause to be duly filed all such further
instruments and documents and take all such actions as the Collateral Agent may
from time to time reasonably request to assure, preserve, protect and perfect
the Security Interest and the rights and remedies created hereby, including the
payment of any fees and taxes required in connection with the execution and
delivery of this Agreement, the granting of the Security Interest and the filing
of any Financing Statements (including Fixture Filings) or other documents in
connection herewith or therewith. If any amount payable under or in connection
with any of the Collateral shall be or become evidenced by any promissory note
or other instrument, the Grantors shall notify the Collateral Agent and upon the
request of the Collateral Agent, such note or instrument shall be immediately
pledged and delivered to the Collateral Agent, duly endorsed in a manner
satisfactory to the Collateral Agent.
4.5 Inspection and Verification. Subject to and without limiting the
terms and conditions of Sections 5.09 of the Credit Agreement, the Collateral
Agent and such Persons as the Collateral Agent may reasonably designate shall
have the right, at the Grantors' own cost and expense, on reasonable prior
notice except if an Event of Default then exists, to inspect the Collateral, all
records related thereto (and to make extracts and copies from such records) and
the premises upon which any of the Collateral is located, to discuss the
Grantors' affairs with the officers of the Grantors and their independent
accountants and to verify the validity, amount, quality, quantity, value,
condition and status of, or any other matter relating to, the Collateral,
including, in the case of Accounts or Collateral in the possession of any third
Person, by contacting Account Debtors or the third Person possessing such
Collateral for the purpose of making such a verification. The Collateral Agent
shall have the absolute right to share any information it gains from such
inspection or verification with any Secured Party.
4.6 Taxes; Encumbrances. At its option, the Collateral Agent may
discharge past due taxes, assessments, charges, fees, Liens, security interests
or other encumbrances at any time levied or placed on the Collateral and not
permitted pursuant to Section 6.02 of the Credit Agreement, and may take any
other action which the Collateral Agent may deem necessary or desirable to
repair, maintain or preserve any of the Collateral to the extent any Grantor
fails to do so as required by the Credit Agreement or this Agreement, and each
Grantor jointly and severally agrees to reimburse the Collateral Agent on demand
for any payment made or any expense incurred by the Collateral Agent pursuant to
the foregoing authorization; provided, however, that the Collateral Agent shall
not have any obligation to undertake any of the foregoing and shall have no
liability on account of any action so undertaken except where there is a
specific finding in a judicial proceeding (in which the Collateral Agent has had
an opportunity to be heard), from which finding no further appeal is available,
that the Collateral Agent had acted in actual bad faith or in a grossly
negligent manner; and provided further that the making of any such payments or
the taking of any such action by the Collateral Agent shall not be deemed to
constitute a waiver of any Default or Event of Default arising from the
Grantor's failure to have
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made such payments or taken such action. Nothing in this Section 4.6 shall be
interpreted as excusing any Grantor from the performance of any covenants or
other promises of any Grantor with respect to taxes, assessments, charges, fees,
Liens, security interests or other encumbrances and maintenance as set forth
herein or in the other Loan Documents.
4.7 Assignment of Security Interest.
(a) If at any time any Grantor shall take a security interest in any
property of an Account Debtor or any other Person to secure payment and
performance of an Account, such Grantor shall promptly assign such
security interest to the Collateral Agent. Such assignment need not be
filed of public record unless necessary to continue the perfected status
of the security interest against creditors of, and transferees from, the
Account Debtor or other Person granting the security interest.
(b) To the extent that any Grantor is a beneficiary under any
written letter of credit now or hereafter issued in favor of such Grantor,
such Grantor shall deliver such letter of credit to the Collateral Agent.
The Collateral Agent shall from time to time, at the request and expense
of such Grantor, make such arrangements with such Grantor as are in the
Collateral Agent's reasonable judgment necessary and appropriate so that
such Grantor may make any drawing to which such Grantor is entitled under
such letter of credit, without impairment of the Collateral Agent's
perfected security interest in such Grantor's rights to proceeds of such
letter of credit or in the actual proceeds of such drawing. At the
Collateral Agent's request, such Grantor shall, for any letter of credit,
whether or not written, now or hereafter issued in favor of such Grantor
as beneficiary, execute and deliver to the issuer and any confirmer of
such letter of credit an assignment of proceeds form, in favor of the
Collateral Agent and satisfactory to the Collateral Agent and such issuer
or (as the case may be) such confirmer, requiring the proceeds of any
drawing under such letter of credit to be paid directly to the Collateral
Agent.
4.8 Continuing Obligations of the Grantors. Each Grantor shall remain
liable to observe and perform all the conditions and obligations to be observed
and performed by it under each contract, agreement or instrument relating to the
Collateral, all in accordance with the terms and conditions thereof, and each
Grantor jointly and severally agrees to indemnify and hold harmless the
Collateral Agent and the Secured Parties from and against any and all liability
for such performance.
4.9 Use and Disposition of Collateral. None of the Grantors shall make
or permit to be made an assignment, pledge or hypothecation of the Collateral or
shall grant any other Lien in respect of the Collateral or shall grant control
(as defined in the UCC) of any Collateral to any third person, except as
expressly permitted by Section 6.02 of the Credit Agreement. Except as expressly
permitted in the Credit Agreement, none of the Grantors shall make or permit to
be made any transfer of the Collateral, and each Grantor shall remain at all
times in possession of the Collateral owned by it, except that the Grantors may
use and dispose of the Collateral in any lawful manner not inconsistent with the
provisions of this Agreement, the Credit Agreement or
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any other Loan Document, including, without limitation, the sale of Inventory in
the ordinary course of business.
4.10 Limitation on Modification of Accounts. None of the Grantors will,
without the Collateral Agent's prior written consent, grant any extension of the
time of payment of any of the Accounts, compromise, compound or settle the same
for less than the full amount thereof, release, wholly or partly, any Person
liable for the payment thereof or allow any credit or discount whatsoever
thereon, other than extensions, releases, credits, discounts, compromises or
settlements granted or made in the ordinary course of business and consistent
with its current practices.
4.11 Insurance.
(a) Each Grantor shall (i) maintain or shall cause to be maintained
such insurance as is required pursuant to Section 5.07 of the Credit
Agreement; (ii) maintain such other insurance, as may be required by law;
and (iii) furnish to the Collateral Agent, upon written request, full
information as to the insurance carried.
(b) All such insurance which covers the Collateral shall include an
endorsement in favor of and reasonably satisfactory to the Collateral
Agent.
(c) Each Grantor hereby irrevocably makes, constitutes and appoints
the Collateral Agent (and all officers,employees or agents designated by
the Collateral Agent) as such Grantor's true and lawful agent (and
attorney-in-fact), for the purpose of making, settling and adjusting
claims in respect of Collateral under policies of insurance, endorsing the
name of such Grantor on any check, draft, instrument or other item of
payment for the proceeds of such policies of insurance and for making all
determinations and decisions with respect thereto. In the event that any
Grantor at any time or times shall fail to obtain or maintain any of the
policies of insurance required hereby or to pay any premium in whole or
part relating thereto, the Collateral Agent may, without waiving or
releasing any obligation or liability of the Grantors hereunder or any
Default or Event of Default, in its sole discretion, obtain and maintain
such policies of insurance and pay such premium and take any other actions
with respect thereto as the Collateral Agent deems advisable. All sums
disbursed by the Collateral Agent in connection with this Section 4.11,
including reasonable attorneys' fees, court costs, expenses and other
charges relating thereto, shall be payable, upon demand, by the Grantors
to the Collateral Agent and shall be additional Obligations secured
hereby.
4.12 Commercial Tort Claims. If any Grantor shall at any time acquire a
Commercial Tort Claim in excess of $50,000, such Grantor shall promptly notify
the Collateral Agent in writing of the details thereof and the Grantors shall
take such actions as the Collateral Agent shall reasonably request in order to
grant to the Collateral Agent, for the ratable benefit of the Secured Parties, a
perfected security interest therein and in the Proceeds thereof.
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4.13 Legend. Each Grantor shall legend, in form and manner reasonably
satisfactory to the Collateral Agent, its Accounts and its books, records and
documents evidencing or pertaining thereto with an appropriate reference to the
fact that such Accounts have been assigned to the Collateral Agent for the
benefit of the Secured Parties and that the Collateral Agent has a security
interest therein.
ARTICLE 5
Collections
5.1 Collections.
(a) Each Grantor shall at all times comply with the Cash Management
Arrangement provisions of Section 2.10 of the Credit Agreement.
(b) Without the prior written consent of the Collateral Agent, no
Grantor shall modify or amend the instructions pursuant to any of the DDA
Notifications, the Credit Card Notifications, or the Blocked Account
Agreements. So long as no Event of Default has occurred, each Grantor
shall, and the Collateral Agent hereby authorizes each Grantor to, enforce
and collect all amounts owing on the Inventory and Accounts, for the
benefit and on behalf of the Collateral Agent and the other Secured
Parties; provided, however, that such privilege may, at the option of the
Collateral Agent, be terminated upon the occurrence of any Event of
Default.
5.2 Power of Attorney. Each Grantor irrevocably makes, constitutes and
appoints the Collateral Agent (and all officers, employees or agents designated
by the Collateral Agent) as such Grantor's true and lawful agent and
attorney-in-fact, and in such capacity the Collateral Agent shall have the
right, with power of substitution for each Grantor and in each Grantor's name or
otherwise, for the use and benefit of the Collateral Agent and the other Secured
Parties, (a) at any time, whether or not a Default or Event of Default has
occurred, to take actions required to be taken by the Grantors under Section 2.1
of this Agreement, and (b) upon the occurrence and during the continuance of an
Event of Default or as otherwise permitted under the Credit Agreement, (i) to
take actions required to be taken by the Grantors under Section 5.1 of this
Agreement, (ii) to receive, endorse, assign and/or deliver any and all notes,
acceptances, checks, drafts, money orders or other evidences of payment relating
to the Collateral or any part thereof; (iii) to demand, collect, receive payment
of, give receipt for and give discharges and releases of all or any of the
Collateral; (iv) to sign the name of any Grantor on any invoices, schedules of
Collateral, freight or express receipts, or bills of lading storage receipts,
warehouse receipts or other documents of title relating to any of the
Collateral; (v) to sign the name of any Grantor on any notice to such Grantor's
Account Debtors; (vi) to sign the name of any Grantor on any proof of claim in
bankruptcy against Account Debtors, and on notices of lien, claims of mechanic's
liens, or assignments or releases of mechanic's liens securing the Accounts;
(vii) to sign change of address forms to change the address to which each
Grantor's mail is to be sent to such address as the Collateral Agent shall
designate; (viii) to receive and open each Grantor's
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mail, remove any Proceeds of Collateral therefrom and turn over the balance of
such mail either to the Lead Borrower or to any trustee in bankruptcy or
receiver of a Grantor, or other legal representative of a Grantor whom the
Collateral Agent determines to be the appropriate person to whom to so turn over
such mail; (ix) to commence and prosecute any and all suits, actions or
proceedings at law or in equity in any court of competent jurisdiction to
collect or otherwise realize on all or any of the Collateral or to enforce any
rights in respect of any Collateral; (x) to settle, compromise, compound, adjust
or defend any actions, suits or proceedings relating to all or any of the
Collateral; (xi) to take all such action as may be necessary to obtain the
payment of any letter of credit and/or banker's acceptance of which any Grantor
is a beneficiary; (xii) to repair, manufacture, assemble, complete, package,
deliver, alter or supply goods, if any, necessary to fulfill in whole or in part
the purchase order of any customer of any Grantor; (xiii) to use, license or
transfer any or all General Intangibles of any Grantor; and (xiv) to use, sell,
assign, transfer, pledge, make any agreement with respect to or otherwise deal
with all or any of the Collateral, and to do all other acts and things necessary
to carry out the purposes of this Agreement, as fully and completely as though
the Collateral Agent were the absolute owner of the Collateral for all purposes;
provided, however, that nothing herein contained shall be construed as requiring
or obligating the Collateral Agent or any other Secured Party to make any
commitment or to make any inquiry as to the nature or sufficiency of any payment
received by the Collateral Agent or any other Secured Party, or to present or
file any claim or notice. It is understood and agreed that the appointment of
the Collateral Agent as the agent and attorney-in-fact of the Grantors for the
purposes set forth above is coupled with an interest and is irrevocable until
such time as the Obligations have been indefeasibly paid in full in cash and
satisfied and the Security Interest has been terminated in accordance with
Section 8.14 hereof.
5.3 No Obligation to Act. The Collateral Agent shall not be obligated to
do any of the acts or to exercise any of the powers authorized by Section 5.2,
but if the Collateral Agent elects to do any such act or to exercise any of such
powers, it shall not be accountable for more than it actually receives as a
result of such exercise of power, and shall not be responsible to any Grantor
for any act or omission to act except for any act or omission to act as to which
there is a final determination made in a judicial proceeding (in which
proceeding the Collateral Agent has had an opportunity to be heard) which
determination includes a specific finding that the subject act or omission to
act had constituted gross negligence, willful misconduct or actual bad faith.
The provisions of Section 5.2 shall in no event relieve any Grantor of any of
its obligations hereunder or under any other Loan Document with respect to the
Collateral or any part thereof or impose any obligation on the Collateral Agent
or any other Secured Party to proceed in any particular manner with respect to
the Collateral or any part thereof, or in any way limit the exercise by the
Collateral Agent or any other Secured Party of any other or further right which
it may have on the date of this Agreement or hereafter, whether hereunder, under
any other Loan Document, by law or otherwise.
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ARTICLE 6
Remedies
6.1 Remedies upon Default. Upon the occurrence of an Event of Default,
it is agreed that the Collateral Agent shall have in any jurisdiction in which
enforcement hereof is sought, in addition to all other rights and remedies, the
rights and remedies of a secured party under the UCC or other Applicable Law.
Without limiting the foregoing, upon the occurrence of an Event of Default, the
rights and remedies of the Collateral Agent shall include, without limitation,
the right to take any of or all the following actions at the same or different
times:
(a) With respect to any Collateral consisting of Accounts, General
Intangibles (including Payment Intangibles), Letter-of-Credit Rights,
Instruments, Chattel Paper, Documents, and Investment Property, the
Collateral Agent may collect the Collateral with or without the taking of
possession of any of the Collateral.
(b) With respect to any Collateral consisting of Accounts, the
Collateral Agent may (i) demand, collect and receive any amounts relating
thereto, as the Collateral Agent may determine; (ii) commence and
prosecute any actions in any court for the purposes of collecting any such
Accounts and enforcing any other rights in respect thereof; (iii) defend,
settle or compromise any action brought and, in connection therewith, give
such discharges or releases as the Collateral Agent may reasonably deem
appropriate; (iv) without limiting the Collateral Agent's rights set forth
in Section 5.2 hereof, receive, open and dispose of mail addressed to any
Grantor and endorse checks, notes, drafts, acceptances, money orders,
bills of lading, warehouse receipts or other instruments or documents
evidencing payment, shipment or storage of the goods giving rise to such
Accounts or securing or relating to such Accounts, on behalf of and in the
name of such Grantor; and (v) sell, assign, transfer, make any agreement
in respect of, or otherwise deal with or exercise rights in respect of,
any such Accounts or the goods or services which have given rise thereto,
as fully and completely as though the Collateral Agent were the absolute
owner thereof for all purposes.
(c) With respect to any Collateral consisting of Investment
Property, the Collateral Agent may (i) exercise all rights of any Grantor
with respect thereto, including without limitation, the right to exercise
all voting and corporate rights at any meeting of the shareholders of the
Issuer of any Investment Property and to exercise any and all rights of
conversion, exchange, subscription or any other rights, privileges or
options pertaining to any Investment Property as if the Collateral Agent
was the absolute owner thereof, including the right to exchange, at its
discretion, any and all of any Investment Property upon the merger,
consolidation, reorganization, recapitalization or other readjustment of
the Issuer thereof, all without liability except to account for property
actually received as provided in Section 5.3 hereof; (ii) transfer such
Collateral at any time to itself, or to its nominee, and receive the
income thereon and hold the same as Collateral hereunder or apply it to
the Obligations; and (iii) demand, xxx for, collect or
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make any compromise or settlement it deems desirable. The Grantors
recognize that (a) the Collateral Agent may be unable to effect a public
sale of all or a part of the Investment Property by reason of certain
prohibitions contained in the Securities Act of 1933, 15 U.S.C. Section
77, (as amended and in effect, the "Securities Act") or the Securities
laws of various states (the "Blue Sky Laws"), but may be compelled to
resort to one or more private sales to a restricted group of purchasers
who will be obliged to agree, among other things, to acquire the
Investment Property for their own account, for investment and not with a
view to the distribution or resale thereof, (b) that private sales so made
may be at prices and upon other terms less favorable to the seller than if
the Investment Property were sold at public sales, (c) that neither the
Collateral Agent nor any Secured Party has any obligation to delay sale of
any of the Investment Property for the period of time necessary to permit
the Investment Property to be registered for public sale under the
Securities Act or the Blue Sky Laws, and (d) that private sales made under
the foregoing circumstances shall be deemed to have been made in a
commercially reasonable manner.
(d) With respect to any Collateral consisting of Inventory, Goods,
and Equipment, the Collateral Agent may conduct one or more going out of
business sales, in the Collateral Agent's own right or by one or more
agents and contractors. Such sale(s) may be conducted upon any premises
owned, leased, or occupied by any Grantor. The Collateral Agent and any
such agent or contractor, in conjunction with any such sale, may augment
the Inventory with other goods (all of which other goods shall remain the
sole property of the Collateral Agent or such agent or contractor). Any
amounts realized from the sale of such goods which constitute
augmentations to the Inventory (net of an allocable share of the costs and
expenses incurred in their disposition) shall be the sole property of the
Collateral Agent or such agent or contractor and neither any Grantor nor
any Person claiming under or in right of any Grantor shall have any
interest therein. Each purchaser at any such going out of business sale
shall hold the property sold absolutely, free from any claim or right on
the part of any Grantor.
(e) With or without legal process and with or without prior notice
or demand for performance, the Collateral Agent may enter upon, occupy,
and use any premises owned or occupied by each Grantor, and may exclude
the Grantors from such premises or portion thereof as may have been so
entered upon, occupied, or used by the Collateral Agent until this
Agreement has been terminated in accordance with Section 8.14 hereof. The
Collateral Agent shall not be required to remove any of the Collateral
from any such premises upon the Collateral Agent's taking possession
thereof, and may render any Collateral unusable to the Grantors. In no
event shall the Collateral Agent be liable to any Grantor for use or
occupancy by the Collateral Agent of any premises pursuant to this Section
6.1, nor for any charge (such as wages for the Grantors' employees and
utilities) incurred in connection with the Collateral Agent's exercise of
the Collateral Agent's Rights and Remedies (as defined herein) hereunder.
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(f) The Collateral Agent may require any Grantor to assemble the
Collateral and make it available to the Collateral Agent at the Grantor's
sole risk and expense at a place or places which are reasonably convenient
to both the Collateral Agent and such Grantor.
(g) Each Grantor agrees that the Collateral Agent shall have the
right, subject to Applicable Law, to sell or otherwise dispose of all or
any part of the Collateral, at public or private sale, for cash, upon
credit or for future delivery as the Collateral Agent shall deem
appropriate. Each purchaser at any such sale shall hold the property sold
absolutely, free from any claim or right on the part of any Grantor.
(h) Unless the Collateral is perishable or threatens to decline
speedily in value, or is of a type customarily sold on a recognized market
(in which event the Collateral Agent shall provide the Grantors such
notice as may be practicable under the circumstances), the Collateral
Agent shall give the Grantors at least ten (10) days' prior written
notice, by authenticated record, of the date, time and place of any
proposed public sale, and of the date after which any private sale or
other disposition of the Collateral may be made, which notice shall
describe the Collateral that is the subject of the intended sale, state
the method of the intended sale and state that the Grantors are entitled
to an accounting of the Obligations and state the charge, if any, for such
accounting. Each Grantor agrees that such written notice shall satisfy all
requirements for notice to that Grantor which are imposed under the UCC or
other Applicable Law with respect to the exercise of the Collateral
Agent's rights and remedies upon default. The Collateral Agent shall not
be obligated to make any sale or other disposition of any Collateral if it
shall determine not to do so, regardless of the fact that notice of sale
or other disposition of such Collateral shall have been given. The
Collateral Agent may, without notice or publication, adjourn any public or
private sale or cause the same to be adjourned from time to time by
announcement at the time and place fixed for sale, and such sale may,
without further notice, be made at the time and place to which the same
was so adjourned.
(i) Any public sale shall be held at such time or times within
ordinary business hours and at such place or places as the Collateral
Agent may fix and state in the notice of such sale. At any sale or other
disposition, the Collateral, or portion thereof, to be sold may be sold in
one lot as an entirety or in separate parcels, as the Collateral Agent may
(in its sole and absolute discretion) determine. If any of the Collateral
is sold, leased, or otherwise disposed of by the Collateral Agent on
credit, the Obligations shall not be deemed to have been reduced as a
result thereof unless and until payment is finally received thereon by the
Collateral Agent.
(j) At any public (or, to the extent permitted by Applicable Law,
private) sale made pursuant to this Section 6.1, the Collateral Agent or
any other Secured Party may bid for or purchase, free (to the extent
permitted by Applicable Law) from any right of redemption, stay, valuation
or appraisal on the part of any Grantor, the Collateral or any
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part thereof offered for sale and may make payment on account thereof by
using any claim then due and payable to the Collateral Agent or such other
Secured Party from any Grantor on account of the Obligations as a credit
against the purchase price, and the Collateral Agent or such other Secured
Party may, upon compliance with the terms of sale, hold, retain and
dispose of such property without further accountability to any Grantor
therefor.
(k) For purposes hereof, a written agreement to purchase the
Collateral or any portion thereof shall be treated as a sale thereof. The
Collateral Agent shall be free to carry out such sale pursuant to such
agreement and no Grantor shall be entitled to the return of the Collateral
or any portion thereof subject thereto, notwithstanding the fact that
after the Collateral Agent shall have entered into such an agreement all
Events of Default shall have been remedied and the Obligations paid in
full.
(l) As an alternative to exercising the power of sale herein
conferred upon it, the Collateral Agent may proceed by a suit or suits at
law or in equity to foreclose upon the Collateral and to sell the
Collateral or any portion thereof pursuant to a judgment or decree of a
court or courts having competent jurisdiction or pursuant to a proceeding
by a court-appointed receiver.
(m) To the extent permitted by Applicable Law, each Grantor hereby
waives all rights of redemption, stay, valuation and appraisal which such
Grantor now has or may at any time in the future have under any rule of
law or statute now existing or hereafter enacted.
6.2 Application of Proceeds. After the occurrence of an Event of Default
and acceleration of the Obligations, the Collateral Agent shall apply the
proceeds of any collection or sale of the Collateral, as well as any Collateral
consisting of cash, or any Collateral granted under any other of the Security
Documents as set forth in Section 7.03 of the Credit Agreement. Upon any sale or
other disposition of the Collateral by the Collateral Agent (including pursuant
to a power of sale granted by statute or under a judicial proceeding), the
receipt of the purchase money by the Collateral Agent or of the officer making
the sale or other disposition shall be a sufficient discharge to the purchaser
or purchasers of the Collateral so sold or otherwise disposed of and such
purchaser or purchasers shall not be obligated to see to the application of any
part of the purchase money paid over to the Collateral Agent or such officer or
be answerable in any way for the misapplication thereof.
ARTICLE 7
Perfection of Security Interest
7.1 Perfection by Filing. This Agreement constitutes an authenticated
record, and each Grantor hereby authorizes the Collateral Agent, pursuant to the
provisions of Sections 2.1
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and 5.2, to file one or more financing or continuation statements, and
amendments thereto, relative to all or any part of the Collateral, in such
filing offices as the Collateral Agent shall deem appropriate, and the Grantors
shall pay the Collateral Agent's reasonable costs and expenses incurred in
connection therewith. Each Grantor hereby further agrees that a carbon,
photographic, or other reproduction of this Agreement shall be sufficient as a
Financing Statement and may be filed as a Financing Statement in any and all
jurisdictions.
7.2 Other Perfection, Etc. The Grantors shall at any time and from time
to time take such steps as the Collateral Agent may reasonably request for the
Collateral Agent (a) to obtain an acknowledgment, in form and substance
reasonably satisfactory to the Collateral Agent, of any bailee having possession
of any of the Collateral that the bailee holds such Collateral for the
Collateral Agent, (b) to obtain "control" of any Investment Property, Deposit
Accounts, Letter-of-Credit Rights or electronic Chattel Paper (as such terms are
defined in the UCC), with any agreements establishing control to be in form and
substance satisfactory to the Collateral Agent, and (c) otherwise to insure the
continued perfection of the Collateral Agent's security interest in any of the
Collateral with the priority described in Section 3.4 and of the preservation of
its rights therein.
7.3 Savings Clause. Nothing contained in this Article VII shall be
construed to narrow the scope of the Collateral Agent's Security Interest in any
of the Collateral or the perfection or priority thereof or to impair or
otherwise limit any of the Collateral Agent's Rights and Remedies hereunder
except (and then only to the extent) as mandated by the UCC.
ARTICLE 8
Miscellaneous
8.1 Notices. All communications and notices hereunder shall (except as
otherwise expressly permitted herein) be in writing and given as provided in
Section 9.01 of the Credit Agreement.
8.2 Grant of Non-Exclusive License. In addition to (and not in
limitation of) the Security Interest granted by the Grantors in Section 2.1
hereof, upon the occurrence of an Event of Default, each Grantor hereby grants
to the Collateral Agent a royalty free, non-exclusive, irrevocable license, to
use, apply, and affix any trademark, trade name, logo, or the like in which any
Grantor now or hereafter has rights, such license being with respect to the
Collateral Agent's exercise of the Collateral Agent's Rights and Remedies
hereunder including, without limitation, in connection with any completion of
the manufacture of Inventory or any sale or other disposition of Inventory.
8.3 Security Interest Absolute. All rights of the Collateral Agent
hereunder, the Security Interest and all obligations of the Grantors hereunder
shall be absolute and unconditional irrespective of (a) any lack of validity or
enforceability of the Credit Agreement, any other Loan Document, any agreement
with respect to any of the Obligations or any other
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agreement or instrument relating to any of the foregoing, (b) any change in the
time, manner or place of payment of, or in any other term of, all or any of the
Obligations, or any other amendment or waiver of or any consent to any departure
from the Credit Agreement, any other Loan Document, or any other agreement or
instrument, (c) any exchange, release or non-perfection of any Lien on other
collateral, or any release or amendment or waiver of or consent under or
departure from the Guaranty or any other guarantee, securing or guaranteeing all
or any of the Obligations, or (d) any other circumstance that might otherwise
constitute a defense available to, or a discharge of, any Grantor in respect of
the Obligations or this Agreement.
8.4 Survival of Agreement. All covenants, agreements, representations
and warranties made by the Grantors herein and in any other Loan Document and in
the certificates or other instruments prepared or delivered in connection with
or pursuant to this Agreement or any other Loan Document shall be considered to
have been relied upon by the Collateral Agent and the other Secured Parties and
shall survive the execution and delivery of this Agreement and the other Loan
Documents and the making of the Term Loans, regardless of any investigation made
by any such other party or on its behalf and notwithstanding that the Agents or
any Lender may have had notice or knowledge of any Default or incorrect
representation or warranty at the time any credit is extended under the Loan
Agreement, and shall continue in full force and effect as long as the
Obligations are outstanding and unpaid.
8.5 Binding Effect; Several Agreement; Assignments. Whenever in this
Agreement any of the parties hereto is referred to, such reference shall be
deemed to include the successors and assigns of such party, and all covenants,
promises and agreements by or on behalf of the Grantors that are contained in
this Agreement shall bind and inure to the benefit of each Grantor and its
respective successors and assigns. This Agreement shall be binding upon each
Grantor and the Collateral Agent and their respective successors and assigns,
and shall inure to the benefit of each Grantor, the Collateral Agent and the
other Secured Parties and their respective successors and assigns, except that
no Grantor shall have the right to assign or transfer its rights or obligations
hereunder or any interest herein or in the Collateral (and any such attempted
assignment or transfer shall be void) except as expressly permitted by this
Agreement or the Credit Agreement. This Agreement shall be construed as a
separate agreement with respect to each Grantor and may be amended, modified,
supplemented, waived or released with respect to any Grantor without the
approval of any other Grantor and without affecting the obligations of any other
Grantor hereunder.
8.6 Collateral Agent's Fees and Expenses; Indemnification.
(a) Without limiting any of their obligations under the Credit
Agreement or the other Loan Documents, the Grantors jointly and severally
agree to pay all reasonable out-of-pocket expenses incurred by the
Collateral Agent, including the reasonable fees, charges and disbursements
of any counsel and any outside consultants for the Collateral Agent, in
connection with (i) the administration of this Agreement, (ii) the custody
or preservation of, or the sale of, collection from or other realization
upon any of the Collateral, (iii) the exercise, enforcement or protection
of any of the Collateral Agent's
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Rights and Remedies hereunder or (iv) the failure of any Grantor to
perform or observe any of the provisions hereof.
(b) Without limiting any of their indemnification obligations under
the Credit Agreement or the other Loan Documents, the Grantors shall
jointly and severally indemnify each Secured Party and each Related Party
of any Secured Party (each such Person being called an "Indemnitee")
against, and hold each Indemnitee ---------- harmless from, any and all
losses, claims, damages, liabilities and related expenses, including the
reasonable fees, charges and disbursements of any counsel for any
Indemnitee, incurred by or asserted against any Indemnitee arising out of,
in connection with, or as a result of, (i) the execution or delivery or
performance of this Agreement or any other Loan Document, the performance
by any Grantor of its obligations under this Agreement or any other Loan
Document, or the consummation of the transactions contemplated by the Loan
Documents or any other transactions contemplated hereby, or (ii) any
actual or prospective claim, litigation, investigation or proceeding
relating to any of the foregoing or to the Collateral, whether based on
contract, tort or any other theory and regardless of whether any
Indemnitee is a party thereto; provided that such indemnity shall not, as
to any Indemnitee, be available to the -------- extent that such losses,
claims, damages, liabilities or related expenses resulted from the gross
negligence or willful misconduct of any Indemnitee or any Affiliate of an
Indemnitee (or of any officer, director, employee, advisor or agent of
such Indemnitee or any such Indemnitee's Affiliates). In connection with
any indemnified claim hereunder, the Indemnitee shall be entitled to
select its own counsel and the Grantors shall promptly pay the reasonable
fees and expenses of such counsel.
(c) Any such amounts payable as provided hereunder shall be
additional Obligations secured hereby and by the other Security Documents.
All amounts due under this Section 8.6 shall be payable promptly after
written demand therefor.
8.7 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
8.8 Waivers; Amendment.
(a) The rights, remedies, powers, privileges, and discretions of the
Collateral Agent hereunder (herein, the "Collateral Agent's Rights and
Remedies") shall be cumulative and not exclusive of any rights or remedies
which it would otherwise have. No delay or omission by the Collateral
Agent in exercising or enforcing any of the Collateral Agent's Rights and
Remedies shall operate as, or constitute, a waiver thereof. No waiver by
the Collateral Agent of any Event of Default or of any Default under any
other agreement shall operate as a waiver of any other Event of Default or
other Default hereunder or under any other agreement. No single or partial
exercise of any of the Collateral Agent's Rights or Remedies, and no
express or implied agreement or transaction of whatever nature entered
into between the Collateral Agent and any Person,
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at any time, shall preclude the other or further exercise of the
Collateral Agent's Rights and Remedies. No waiver by the Collateral Agent
of any of the Collateral Agent's Rights and Remedies on any one occasion
shall be deemed a waiver on any subsequent occasion, nor shall it be
deemed a continuing waiver. The Collateral Agent's Rights and Remedies may
be exercised at such time or times and in such order of preference as the
Collateral Agent may determine. The Collateral Agent's Rights and Remedies
may be exercised without resort or regard to any other source of
satisfaction of the Obligations. No waiver of any provisions of this
Agreement or any other Loan Document or consent to any departure by any
Grantor therefrom shall in any event be effective unless the same shall be
permitted by paragraph (b) below, and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which
given. No notice to or demand on any Grantor in any case shall entitle
such Grantor or any other Grantor to any other or further notice or demand
in similar or other circumstances.
(b) Neither this Agreement nor any provision hereof may be waived,
amended or modified except pursuant to a written agreement entered into
between the Collateral Agent and the Grantor or Grantors with respect to
whom such waiver, amendment or modification is to apply, subject to any
consent required in accordance with Section 9.02 of the Credit Agreement.
8.9 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT TO A JURY IN ANY TRIAL OF
ANY CASE OR CONTROVERSY IN WHICH ANY PARTY HERETO IS OR BECOMES A PARTY (WHETHER
SUCH CASE OR CONTROVERSY IS INITIATED BY OR AGAINST ANY PARTY HERETO OR IN WHICH
ANY PARTY HERETO IS JOINED AS A PARTY LITIGANT), WHICH CASE OR CONTROVERSY
ARISES OUT OF OR RELATES TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT. EACH
PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY
OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD
NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B)
ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER
INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS SET FORTH IN THIS SECTION 8.9.
8.10 Severability. Any provision of this Agreement held to be invalid,
illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such invalidity, illegality or unenforceability
without affecting the validity, legality and enforceability of the remaining
provisions hereof; and the invalidity of a particular provision in a particular
jurisdiction shall not invalidate such provision in any other jurisdiction.
8.11 Counterparts. This Agreement may be executed in counterparts (and by
different parties hereto on different counterparts), each of which shall
constitute an original, but all of which when taken together shall constitute a
single contract. Delivery of an executed
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counterpart of a signature page of this Agreement by telecopy shall be effective
as delivery of a manually executed counterpart of this Agreement.
8.12 Headings. Article and Section headings used herein are for
convenience of reference only, are not part of this Agreement and shall not
affect the construction of, or be taken into consideration in interpreting, this
Agreement.
8.13 Jurisdiction; Consent to Service of Process.
(a) The Grantors agree that any suit for the enforcement of this
Agreement or any other Loan Document may be brought in any New York state
or federal court sitting in New York County as the Collateral Agent may
elect in its sole discretion and consent to the non-exclusive jurisdiction
of such courts. The Grantors hereby waive any objection which they may now
or hereafter have to the venue of any such suit or any such court or that
such suit is brought in an inconvenient forum. The Grantors agree that any
action commenced by any Grantor asserting any claim or counterclaim
arising under or in connection with this Agreement or any other Loan
Document shall be brought solely in any New York state or federal court
sitting in New York County as the Collateral Agent may elect in its sole
discretion and consent to the exclusive jurisdiction of such courts with
respect to any such action.
(b) Each party to this Agreement irrevocably consents to service of
process in the manner provided for notices in Section 8.13. Nothing in
this Agreement or any other Loan Document will affect the right of any
party to this Agreement to serve process in any other manner permitted by
law.
8.14 Termination; Release of Collateral. Except for those provisions
which expressly survive the termination thereof, the Credit Agreement, this
Agreement and the Security Interest granted herein shall terminate when all the
Obligations have been paid and performed in full, at which time the Collateral
Agent shall execute or authorize and deliver to the Grantors, at the Grantors'
expense, all UCC termination statements and similar documents that the Grantors
shall reasonably request to evidence such termination; provided, however, that
the Credit Agreement, this Agreement, and the Security Interest granted herein
shall be reinstated if at any time payment, or any part thereof, of any
Obligation is rescinded or must otherwise be restored by any Secured Party upon
the bankruptcy or reorganization of any Borrower, Grantor or other Loan Party,
and provided further that the Security Interest granted herein shall not
terminate as to any indemnification obligation of any Borrower, Grantor or other
Loan Party which expressly survives the termination of the Credit Agreement and
this Agreement, including, without limitation, the obligations of the Loan
Parties set forth in Section 9.03 of the Credit Agreement and the obligations of
the Grantors set forth in Section 8.6 of this Agreement. Any execution and
delivery of termination statements or documents pursuant to this Section 8.14
shall be without recourse to, or warranty by, the Collateral Agent.
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8.15 Intercreditor Agreement. The representations, warranties and
covenants of each Grantor hereunder, and the rights and remedies of the
Collateral Agent hereunder, are subject to the provisions of the Intercreditor
Agreement. Each of the Grantors and the Collateral Agent hereby agree that so
long as the Intercreditor Agreement remains in effect, in the event of a
conflict between this Agreement and the Intercreditor Agreement, the terms of
the Intercreditor Agreement shall control.
[SIGNATURE PAGES FOLLOW]
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IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement
under seal as of the day and year first above written.
GRANTORS:
XXXXX SUPERMARKETS, LLC
XXXXX SUPERMARKETS, INC.
XXXXX DRUGS, INC.
XXXXX VILLAGE PANTRIES, INC.
X. X. XXXX & SONS, INC.
XXXXX REALTY, INC.
MAR PROPERTIES, INC.
MARLEASE, INC.
XXXXX INTERNATIONAL, INC.
XXXXX DRUGS OF ILLINOIS, INC.
LIMITED HOLDINGS, INC.
XXXXX SUPERMARKETS OF ILLINOIS,
INC.
TEMPORARY SERVICES, INC.
CONTRACT TRANSPORT, INC.
NORTH XXXXXX DEVELOPMENT
CORPORATION
O'MALIA FOOD MARKETS, LLC
FLORAL FASHIONS, LLC
CRYSTAL FOOD SERVICES, LLC
XXXXXXXX, LLC
LOBILL FOODS,LLC
CONTRACT TRANSPORT, LLC
VILLAGE PANTRY, LLC
XXXXX DRUGS, LLC
XXXXX CLEARING HOUSE, LLC
CRYSTAL CAFE MANAGEMENT
GROUP, LLC
CONVENIENCE STORE TRANSPORTATION
COMPANY, LLC
CRYSTAL FOOD MANAGEMENT
SERVICES, LLC
XXXXXXXXXXX FOODS, LLC
By: /s/ Xxxxxxx X. Xxxxxxxxx
-----------------------------------
Xxxxxxx X. Xxxxxxxxx, Senior Vice
President, Chief Financial Officer
and Treasurer
Attest: /s/ X. Xxxxxxxx Butt
-----------------------------------
X. Xxxxxxxx Butt, Secretary
PANTRY PROPERTY, LLC
BY: VILLAGE PANTRY, LLC
MS PROPERTY, LLC
BY: XXXXX SUPERMARKETS, LLC
BF PROPERTY, LLC
BY: XXXXXXXXXXX FOODS, LLC
CF PROPERTY, LLC
BY: CRYSTAL FOOD SERVICES, LLC
MD PROPERTY, LLC
BY: XXXXX DRUGS, LLC
LB PROPERTY, LLC
BY: LOBILL FOODS, LLC
MCN PROPERTY, LLC
BY: XXXXXXXX, LLC
CSD PROPERTY, LLC
BY: CRYSTAL CAFE MANAGEMENT GROUP, LLC
FLORAL PROPERTY, LLC
BY: XXXXX SUPERMARKETS, LLC
By: /s/ Xxxxxxx X. Xxxxxxxxx
-------------------------------
Xxxxxxx X. Xxxxxxxxx, Senior Vice
President, Chief Financial Officer
and Treasurer
Attest: /s/ X. Xxxxxxxx Butt
--------------------------------
X.Xxxxxxxx Butt, Secretary
TRADEMARK HOLDINGS, INC.
By: /s/ X. Xxxxxxxx Butt
-----------------------------------
X. Xxxxxxxx Butt, Assistant Treasurer
COLLATERAL AGENT: BACK BAY CAPITAL FUNDING LLC
By: /s/ Xxxxxxx X. Xxxxxxx
--------------------------------------
Xxxxxxx X. Xxxxxxx
Managing Director
