SECURITY AGREEMENT
Exhibit 4.49
This
SECURITY AGREEMENT (this
“Agreement”),
dated as of February 14, 2008, by and among Grantors listed on the
signature pages hereof and those additional entities that hereafter become
parties hereto by executing the form of Supplement attached hereto as Annex 1
(collectively, jointly and severally, the “Grantors” and each,
individually, a “Grantor”), and ABLECO FINANCE LLC, in its
capacity as administrative agent for the Lender Group (in such capacity,
together with its successors, the “Agent”).
W I T N E
S S E T H:
WHEREAS, pursuant to that
certain Credit Agreement dated as of July 17, 2007 as amended by Amendment No.1
to Credit Agreement, dated as of the date hereof (as amended, restated,
supplemented, or otherwise modified from time to time, including all schedules
thereto, the “Credit
Agreement”) by and among Bairnco Corporation (“Parent”), each of
Parent’s Subsidiaries identified on the signature pages thereto (such
Subsidiaries, together with Parent, are referred to hereinafter each
individually as a “Borrower”, and
individually and collectively, jointly and severally, as “Borrowers”), the
lenders party thereto as “Lenders” (“Lenders”), and Agent,
the Lender Group has agreed to make certain financial accommodations available
to Borrowers from time to time pursuant to the terms and conditions thereof,
and
WHEREAS, Agent has agreed to
act as agent for the benefit of the Lender Group in connection with the
transactions contemplated by the Credit Agreement and this Agreement,
and
WHEREAS, in order to induce
the Lender Group to enter into the Credit Agreement and the other Loan Documents
and to induce the Lender Group to make financial accommodations to Borrowers as
provided for in the Credit Agreement, Grantors have agreed to (i) enter into the
Guaranty (as hereinafter defined), pursuant to which the Grantors guarantied the
payment of the Secured Obligations (as hereinafter defined), subject to certain
limitations set forth in the Guaranty and (ii) grant a continuing security
interest in and to the Collateral in order to secure the prompt and complete
payment, observance and performance of, among other things, the Secured
Obligations, subject to the terms and conditions of the Intercreditor Agreement
(as hereinafter defined), and
NOW, THEREFORE, for and in
consideration of the recitals made above and other good and valuable
consideration, the receipt, sufficiency and adequacy of which are hereby
acknowledged, the parties hereto agree as follows:
1. Defined Terms. All
capitalized terms used herein (including in the preamble and recitals hereof)
without definition shall have the meanings ascribed thereto in the Credit
Agreement. Any terms used in this Agreement that are defined in the
Code shall be construed and defined as set forth in the Code unless otherwise
defined herein or in the Credit Agreement; provided, however, that if the
Code is used to define any term used herein and if such term is defined
differently in different Articles of the Code, the definition of such term
contained in Article 9 of the Code shall govern. In addition to those terms
defined elsewhere in this Agreement, as used in this Agreement, the following
terms shall have the following meanings:
(a) “Account” means an
account (as that term is defined in the Code).
(b) “Account Debtor” means
an account debtor (as that term is defined in the Code).
(c) “Books” means books
and records (including each Grantor’s Records indicating, summarizing, or
evidencing such Grantor’s assets (including the Collateral) or liabilities, each
Grantor’s Records relating to such Grantor’s business operations or financial
condition, and each Grantor’s goods or General Intangibles related to such
information).
(d) “Borrower” and “Borrowers” have the
respective meanings specified therefor in the recitals to this
Agreement.
(e) “Chattel Paper” means
chattel paper (as that term is defined in the Code) and includes tangible
chattel paper and electronic chattel paper.
(f) “Code” means the New
York Uniform Commercial Code, as in effect from time to time; provided, however, that in the
event that, by reason of mandatory provisions of law, any or all of the
attachment, perfection, priority, or remedies with respect to Agent’s Lien on
any Collateral is governed by the Uniform Commercial Code as enacted and in
effect in a jurisdiction other than the State of New York, the term “Code” shall
mean the Uniform Commercial Code as enacted and in effect in such other
jurisdiction solely for purposes of the provisions thereof relating to such
attachment, perfection, priority, or remedies.
(g) “Collateral” has the
meaning specified therefor in Section
2.
(h) “Commercial Tort
Claims” means commercial tort claims (as that term is defined in the
Code), and includes those commercial tort claims listed on Schedule 1 (“Commercial Tort
Claims”).
(i) “Copyrights” means
copyrights and copyright registrations, and also includes (i) the copyright
registrations and recordings thereof and all applications in connection
therewith of the Grantors, (ii) all reissues, continuations, extensions or
renewals thereof, (iii) all income, royalties, damages and payments now and
hereafter due or payable under and with respect thereto, including payments
under all licenses entered into in connection therewith and damages and payments
for past or future infringements or dilutions thereof, (iv) the right to xxx for
past, present and future infringements and dilutions thereof, (v) the goodwill
of each Grantor’s business symbolized by the foregoing or connected therewith,
and (vi) all of each Grantor’s rights corresponding thereto throughout the
world.
(j) “Credit Agreement” has
the meaning specified therefor in the recitals to this Agreement.
(k) “Deposit Account”
means a deposit account (as that term is defined in the Code).
(l) “Equipment” means
equipment (as that term is defined in the Code).
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(m) “Existing Credit
Agreements” means, collectively, the Wachovia Credit Agreement and the
Steel Partners Credit Agreement, as each such agreement may be amended from time
to time.
(n) “Existing Lenders”
means the financial institutions that are parties to the Existing Credit
Agreements from time to time as lenders.
(o)
“General
Intangibles” means general intangibles (as that term is defined in the
Code) and, in any event, includes payment intangibles, contract rights, rights
to payment, rights arising under common law, statutes, or regulations, choses or
things in action, goodwill (including the goodwill associated with any
Trademark, Patent, or Copyright), Patents, Trademarks, Copyrights, URLs and
domain names, industrial designs, other industrial or Intellectual Property or
rights therein or applications therefor, whether under license or otherwise,
programs, programming materials, blueprints, drawings, purchase orders, customer
lists, monies due or recoverable from pension funds, route lists, rights to
payment and other rights under any royalty or licensing agreements, including
Intellectual Property Licenses, infringement claims, computer programs,
information contained on computer disks or tapes, software, literature, reports,
catalogs, pension plan refunds, pension plan refund claims, insurance premium
rebates, tax refunds, and tax refund claims, interests in a partnership or
limited liability company which do not constitute a security under Article 8 of
the Code, and any other personal property other than Commercial Tort Claims,
money, Accounts, Chattel Paper, Deposit Accounts, goods, Investment Related
Property, Negotiable Collateral, and oil, gas, or other minerals before
extraction.
(p) “Grantor” and “Grantors” have the
meanings specified therefor in the recitals to this Agreement.
(q) "Guaranty" means the
Limited General Continuing Guaranty, dated as of the date hereof, made by each
Grantor in favor of the Agent.
(r) “Guaranty Event of
Default” means the occurrence of (i) an Event of Default under Section 7.4 and Section 7.5 of the
Credit Agreement or (ii) any other Event of Default and, in the case of this
clause (ii), if such Event of Default exists twelve (12) months after the date
of its occurrence.
(s) “Intellectual
Property” means Patents, Copyrights, Trademarks, the goodwill associated
with such Trademarks, trade secrets and customer lists, and Intellectual
Property Licenses.
(t) “Intellectual Property
Licenses” means rights under or interests in any Patent, Trademark,
Copyright or other Intellectual Property, including software license agreements
with any other party, whether the applicable Grantor is a licensee or licensor
under any such license agreement.
(u) "Intercreditor
Agreement" means the Intercreditor and Subordination Agreement, dated as
of the date hereof, by and among Agent, Wachovia and Steel Partners and
acknowledged and consented to by each Grantor, as amended, supplemented,
restated or otherwise modified from time to time.
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(v) “Inventory” means
inventory (as that term is defined in the Code).
(w) “Investment Related
Property” means (i) investment property (as that term is defined in the
Code), and (ii) all of the following (regardless of whether classified as
investment property under the Code): all Pledged Interests.
(x) "Loan Documents" means
(i) the Loan Documents (as defined in the Credit Agreement), (ii) the Guaranty,
(iii) the Intercreditor Agreement, (iv) this Agreement, and (v) any mortgages,
pledges, hypothecations, certificates, Copyright Security Agreements, Patent
Security Agreements, or Trademark Security Agreements entered into or delivered
in connection with this Agreement.
(y) “Negotiable
Collateral” means letters of credit, letter-of-credit rights,
instruments, promissory notes, drafts, and documents.
(z) “Patents” means
patents and patent applications, and also includes (i) the patents and patent
applications of the Grantors, (ii) all renewals thereof, (iii) all income,
royalties, damages and payments now and hereafter due or payable under and with
respect thereto, including payments under all licenses entered into in
connection therewith and damages and payments for past or future infringements
or dilutions thereof, (iv) the right to xxx for past, present and future
infringements and dilutions thereof, and (v) all of each Grantor’s rights
corresponding thereto throughout the world.
(aa) "Permitted Liens"
means (i) the Liens incurred pursuant to this Agreement, (ii) the Liens incurred
pursuant to the Wachovia Credit Agreement, or any replacement financing or other
refinancing, and any security agreements or other documents related thereto, and
(iii) the Liens permitted pursuant to the Wachovia Credit Agreement (as in
effect on the date hereof), as such agreement may be amended from time to
time.
(bb) “Pledged Interests”
means all of each Grantor’s right, title and interest in and to all of the Stock
now or hereafter owned by such Grantor, regardless of class or designation,
including all substitutions therefor and replacements thereof, all proceeds
thereof and all rights relating thereto, also including any certificates
representing the Stock, the right to receive any certificates representing any
of the Stock, all warrants, options, share appreciation rights and other rights,
contractual or otherwise, in respect thereof, and the right to receive
dividends, distributions of income, profits, surplus, or other compensation by
way of income or liquidating distributions, in cash or in kind, and cash,
instruments, and other property from time to time received, receivable, or
otherwise distributed in respect of or in addition to, in substitution of, on
account of, or in exchange for any or all of the foregoing.
(cc) “Proceeds” has the
meaning specified therefor in Section
2.
(dd) “Real Property” means
any estates or interests in real property now owned or hereafter acquired by any
Grantor and the improvements thereto.
(ee) “Records” means
information that is inscribed on a tangible medium or which is stored in an
electronic or other medium and is retrievable in perceivable form.
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(ff) “Secured Obligations”
shall have the meaning ascribed to the term “Guarantied Obligations” in the
Guaranty.
(gg) “Security Interest”
has the meaning specified therefor in Section
2.
(hh) “Securities Account”
means a securities account (as that term is defined in the Code).
(ii)
“Steel
Partners” means Steel Partners II, L.P., a Delaware limited partnership,
in its capacity as Agent under the Steel Partners Credit Agreement, and its
successors and assigns.
(jj) "Steel Partners Credit
Agreement" means that certain Loan and Security Agreement, dated March
31, 2004, by and among Steel Partners, the financial institutions that are
parties thereto from time to time as lenders, and Grantors, as amended from time
to time, or any credit, loan, security or other agreement with a lender in
connection with the refinancing or replacement of the obligations
thereunder.
(kk) “Supporting
Obligations” means supporting obligations (as such term is defined in the
Code).
(ll) “Trademarks” means
trademarks, trade names, trademark applications, service marks, service xxxx
applications, and also includes (i) the trade names, trademarks, trademark
applications, service marks, and service xxxx applications of the Grantors, and
(ii) all renewals thereof, (iii) all income, royalties, damages and payments now
and hereafter due or payable under and with respect thereto, including payments
under all licenses entered into in connection therewith and damages and payments
for past or future infringements or dilutions thereof, (iv) the right to xxx for
past, present and future infringements and dilutions thereof, (v) the goodwill
of each Grantor’s business symbolized by the foregoing or connected therewith,
and (v) all of each Grantor’s rights corresponding thereto throughout the
world.
(mm) “URL” means “uniform
resource locator,” an internet web address.
(nn) "Wachovia" means
Wachovia Bank, National Association, in its capacity as Agent under the Wachovia
Credit Agreement, and its successors and assigns.
(oo) "Wachovia Credit
Agreement" means that certain Loan and Security Agreement, dated March
31, 2004, by and among Wachovia, the financial institutions that are parties
thereto from time to time as lenders, and Grantors, as amended from time to
time, or any credit, loan, security or other agreement with a lender in
connection with the refinancing or replacement of the obligations
thereunder.
(pp) “Working Capital Loan
Termination Date” shall have the meaning ascribed to such term in the
Intercreditor Agreement.
2. Grant of
Security. Each Grantor hereby unconditionally grants, assigns,
and pledges to Agent, for the benefit of the Lender Group, a continuing security
interest (herein referred to as the “Security Interest”)
in all Collateral (as such term is defined in the Wachovia Credit Agreement) of
such Grantor whether now owned or hereafter acquired or arising and wherever
located.
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3. Security for
Obligations. This Agreement and the Security Interest created
hereby secures the payment and performance of the Secured Obligations, whether
now existing or arising hereafter. Without limiting the generality of
the foregoing, this Agreement secures the payment of all amounts which
constitute part of the Secured Obligations and would be owed by Grantors, or any
of them, to Agent, the Lender Group or any of them, but for the fact that they
are unenforceable or not allowable due to the existence of an Insolvency
Proceeding involving any Grantor.
4. Grantors Remain
Liable. Anything herein to the contrary notwithstanding, (a)
each of the Grantors shall remain liable under the contracts and agreements
included in the Collateral, to perform all of the duties and obligations
thereunder to the same extent as if this Agreement had not been executed, (b)
the exercise by Agent or any other member of the Lender Group of any of the
rights hereunder shall not release any Grantor from any of its duties or
obligations under such contracts and agreements included in the Collateral, and
(c) none of the members of the Lender Group shall have any obligation or
liability under such contracts and agreements included in the Collateral by
reason of this Agreement, nor shall any of the members of the Lender Group be
obligated to perform any of the obligations or duties of any Grantors thereunder
or to take any action to collect or enforce any claim for payment assigned
hereunder. Until a Guaranty Event of Default shall occur and be
continuing, except as otherwise provided in this Agreement, the Credit
Agreement, the Guaranty or other Loan Documents, Grantors shall have the right
to possession and enjoyment of the Collateral for the purpose of conducting the
ordinary course of their respective businesses, subject to and upon the terms
hereof and of the Credit Agreement, the Guaranty and the other Loan
Documents. Without limiting the generality of the foregoing, it is
the intention of the parties hereto that record and beneficial ownership of the
Pledged Interests, including all voting, consensual, and dividend rights, shall
remain in the applicable Grantor until the occurrence of a Guaranty Event of
Default, and until Agent shall notify the applicable Grantor of Agent’s exercise
of voting, consensual, or dividend rights with respect to the Pledged Interests
pursuant to Section
15.
5. Representations and
Warranties. Each Grantor hereby represents and warrants as
follows:
(a) The
Grantors jointly and severally represent and warrant that (i) the exact legal
name and jurisdiction of organization of each Grantor is set forth next to its
name on the signature pages hereto and (ii) none of the Grantors has created or
is aware of any Lien on or affecting any of the Collateral other than as created
hereby, except for the Permitted Liens.
(b) The
Collateral is directly, legally and, in the case of the Pledged Interests,
beneficially owned by the Grantors, free and clean of all Liens of any kind,
nature or description, except for the pledge and security interest under the
Permitted Liens.
(c) The
Collateral is not subject to any restriction relative to the transfer thereof
(other than, in the case of the Pledged Interests, restrictions on transfer
under the Securities Act of 1933, as amended, and applicable state securities
laws), and each Grantor has the right to transfer and hypothecate the Collateral
owned by it free and clean of any Liens, other than the liens in favor of the
Permitted Liens.
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(d) Upon
delivery to the Agent (or, until the Working Capital Loan Termination Date,
Wachovia, acting as agent for Agent), of the stock certificates evidencing the
Pledged Interests, the Agent will hold a valid and perfected security interest
in the Pledged Interests, free and clean of any other Lien, except for the
Permitted Liens. No part of the Collateral, any right to receive or
collect the same or any proceeds thereof , will be subject to any Lien other
than the Lien in favor of the Permitted Liens.
(e) No
consent, approval, authorization, or other order or other action by, and no
notice to or filing with, any Governmental Authority or any other Person is
required (i) for the grant of a Security Interest by such Grantor in and to the
Collateral pursuant to this Agreement or for the execution, delivery, or
performance of this Agreement by such Grantor, or (ii) for the exercise by Agent
(or, until the Working Capital Loan Termination Date, Wachovia, acting as agent
for the Agent) of the voting or other rights provided for in this Agreement with
respect to the Investment Related Property or the remedies in respect of the
Collateral pursuant to this Agreement, except as may be required in connection
with such disposition of Investment Related Property by laws affecting the
offering and sale of securities generally.
6. Covenants. Each
Grantor, jointly and severally, covenants and agrees with Agent that from and
after the date of this Agreement and until the date of termination of this
Agreement in accordance with Section
22:
(a) Each
Grantor assumes all liability and responsibility in connection with all
Collateral acquired by such Grantor and the Secured Obligations shall in no way
be affected or diminished by reason of the fact that any such Collateral may be
lost, destroyed, stolen, or for any reason whatsoever unavailable to such
Grantor.
(b) As
long as this Agreement shall remain in effect, each Grantor agrees:
(i) that
in order to enable the Agent to comply with the law of any jurisdiction,
including state, federal and foreign, applicable to any security interest
granted hereby or to the Collateral, to execute and deliver upon request, in
form reasonably acceptable to the Agent, any financing statement, notice,
statement, instrument, document, agreement or other paper and/or to perform any
act requested by the Agent which may be necessary to create, perfect, preserve,
validate or otherwise protect such security interest or to enable the Agent to
exercise and enforce its rights hereunder or with respect to such security
interest;
(ii) except
for the security interest granted hereby, each Grantor shall keep the Collateral
and proceeds, products, accessions and substitutions therefor free and clear of
any Lien of any kind, except the Permitted Liens;
(iii) to
promptly pay, when due, all taxes, charges and fees affecting or arising out of
any of the Collateral and to defend the Collateral against all claims and
demands (other than with respect to the Permitted Liens) of all persons or
entities at any time claiming the same or any interest therein adverse to the
Agent;
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(iv) that
the Agent’s duty with respect to the Collateral shall be solely to use
reasonable care in the custody and preservation of the Collateral in its
possession; the Agent shall not be obligated to take any steps necessary to
preserve any rights in any of the Collateral against prior parties, and each
Grantor hereby agrees to take such steps; the Grantor may, but is not obligated
to, exercise any and all rights of conversion or exchange or similar rights,
privileges and options relating to any of the Collateral; the Grantor shall have
no obligation to sell or otherwise realize upon any of the Collateral as herein
authorized and shall not be responsible for any failure to do so or for any
delay in so doing;
(v) to
the extent not paid by the Borrowers following proper demand, to promptly
reimburse the Agent on demand for any charges, assessments or expenses paid or
incurred by the Agent for the protection, preservation and maintenance of any of
the Collateral and the enforcement by the Agent’s rights hereunder, including,
without limitation, reasonable attorneys’ fees and legal expenses incurred by
the Agent in seeking to protect, collect or enforce the Agent’s rights in any of
the Collateral or otherwise hereunder, subject to and included in the Guaranty
Limit (as defined in the Guaranty);
(vi) to
provide the Agent with such information as the Agent may from time to time
reasonably request with respect to the location and/or status of the Collateral;
and
(vii) to
promptly notify the Agent in writing of any change in the principal place of
business of such Grantor.
(c) Subject
to the terms and conditions of the Intercreditor Agreement and the Guaranty,
from and after the occurrence of a Guaranty Event of Default, in addition to the
rights and remedies set forth elsewhere in this Agreement: (i) the Agent is
authorized, to the extent permitted by law, to take possession of the
Collateral; (ii) the Agent may proceed to apply to the Secured Obligations any
or all of the Collateral; and (iii) in addition to the rights and remedies given
to the Agent hereunder or otherwise, the Agent shall have all of the rights and
remedies of a secured party under the Uniform Commercial Code of the State of
New York.
(d) In
the case of any sale of Collateral or proceedings to collect any of the Secured
Obligations, to the extent not paid by the Borrowers following proper demand,
the Grantors shall be jointly and severally liable for the payment of all costs
and expenses of every kind for collection, sale or delivery, including
reasonable attorneys’ fees, and after deducting such costs and expenses from the
proceeds of sale or collection, the Agent may apply any residue to pay any of
the Secured Obligations and the Grantors will continue to be jointly and
severally liable for any deficiency, subject to and included in the Guaranty
Limit.
(e) All
options, powers and rights granted to the Agent hereunder shall be cumulative
and shall be in addition to any other options, powers or rights which the Agent
may now or hereafter have as a secured party under the Uniform Commercial Code
of the State of New York or under any other applicable law or
otherwise.
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(f) The
Agent shall have the right, for and in the name, place and stead of each
Grantor, and as its attorney-in-fact, to execute endorsements, assignments or
other instruments of conveyance or transfer with respect to any of the
Collateral.
(g) All
rights and remedies of the Agent hereunder shall be subject to the terms and
conditions of the Intercreditor Agreement and the Guaranty. In the
event of any conflict between the terms of this Agreement and the terms of the
Intercreditor Agreement and the Guaranty, the terms of the Intercreditor
Agreement shall control.
(h) Each
Grantor authorizes the Agent (or, until the Working Capital Loan Termination
Date, Wachovia, acting as agent for Agent) to: (i) store, deposit and safeguard
the Collateral; (ii) perform any and all other acts which the Agent (or, until
the Working Capital Loan Termination Date, Wachovia, acting as agent for Agent)
in good xxxxx xxxxx commercially reasonable and/or necessary for the protection
and preservation of the Collateral or its value, including, without limitation,
in the case of the Pledged Interests, transferring, registering or arranging for
the transfer or registration of the Pledged Interests to the Agent’s name (or,
until the Working Capital Loan Termination Date, Wachovia’s name, acting as
agent for Agent), and after the occurrence and during the continuance of a
Guaranty Event of Default, subject to the terms and conditions of the
Intercreditor Agreement and the Guaranty, receiving the income therefrom on
behalf of the Agent as additional security for the Secured Obligations; and
(iii) pay any charges or expenses which the Agent (or, until the Working Capital
Loan Termination Date, Wachovia, acting as agent for Agent) deems necessary or
advisable for the foregoing purpose, but without any obligation to do
so.
(i) If
any of the Grantors shall become entitled to receive or acquire, or shall
receive any stock certificate, or option or right with respect to the stock of
any of their respective subsidiaries (including, without limitation, any
certificate representing a dividend or a distribution or exchange of or in
connection with a reclassification of any of the Pledged Interests) whether as
an addition to, in substitution of, or in exchange for any of the Pledged
Interests or otherwise, each of the Grantors agrees to accept same as the
Agent’s (or, until the Working Capital Loan Termination Date, Wachovia, acting
as agent for the Agent) agent, to hold same in trust for the Agent and, subject
to the terms of the Intercreditor Agreement and the Guaranty, to deliver same
forthwith to the Agent (or, until the Working Capital Loan Termination Date,
Wachovia, acting as agent for the Agent) in the form received, with the
endorsement(s) of the Grantors where necessary and/or appropriate powers and/or
assignments duly executed to be held by the Agent (or its agent) subject to the
terms hereof, as further security for the Secured Obligations.
(j) So
long as no Guaranty Event of Default has occurred and is continuing, the
Grantors shall have the right to vote and exercise all corporate rights with
respect to the Pledged Interests, except as expressly prohibited herein, and to
receive any cash dividends payable in respect of the Pledged
Interests.
7. [Intentionally
Deleted.]
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8. Further
Assurances.
(a) Each
Grantor agrees that from time to time, at its own expense, such Grantor will
promptly execute and deliver all further instruments and documents, and take all
further action, that may be necessary or that Agent may reasonably request, in
order to perfect and protect the Security Interest granted or purported to be
granted hereby or to enable Agent to exercise and enforce its rights and
remedies hereunder with respect to any of the Collateral.
(b) Each
Grantor authorizes the filing by Agent financing or continuation statements, or
amendments thereto, and such Grantor will execute and deliver to Agent such
other instruments or notices, as may be necessary or as Agent may reasonably
request, in order to perfect and preserve the Security Interest granted or
purported to be granted hereby.
(c) Each
Grantor authorizes Agent at any time and from time to time to file, transmit, or
communicate, as applicable, financing statements and amendments (i) describing
the Collateral as “all personal property of debtor” or “all assets of debtor” or
words of similar effect, (ii) describing the Collateral as being of equal or
lesser scope or with greater detail, or (iii) that contain any information
required by part 5 of Article 9 of the Code for the sufficiency or filing office
acceptance. Each Grantor also hereby ratifies any and all financing
statements or amendments previously filed by Agent in any
jurisdiction.
(d) Each
Grantor acknowledges that it is not authorized to file any financing statement
or amendment or termination statement with respect to any financing statement
filed in connection with this Agreement without the prior written consent of
Agent, subject to such Grantor’s rights under Section 9-509(d)(2) of the
Code.
(e) Agent,
on behalf of the Lender Group, acknowledges that Grantors are authorized to
sell, dispose or otherwise transfer, and may in the future be authorized to
sell, dispose or otherwise transfer, upon receipt of waivers or otherwise,
assets or securities from time to time pursuant to the Wachovia Credit
Agreement. At the request of Grantors at any time and from time to time, Agent,
on behalf of the Lender Group, shall duly execute and deliver, or cause to be
duly executed and delivered, such further agreements, documents and instruments,
and do or cause to be done such further acts as may be necessary or proper to
release its lien on such assets or securities to the extent necessary to permit
such sale, disposition or transfer pursuant to the Wachovia Credit
Agreement.
9. Agent’s Right to Perform
Contracts, Exercise Rights, etc. Upon the occurrence and
during the continuance of a Guaranty Event of Default, but subject to the terms
of the Intercreditor Agreement and the Guaranty, Agent (or its designee) (a) may
proceed to perform any and all of the obligations of any Grantor contained in
any contract, lease, or other agreement and exercise any and all rights of any
Grantor therein contained as fully as such Grantor itself could, (b) shall have
the right to use any Grantor’s rights under Intellectual Property Licenses in
connection with the enforcement of the Agent’s rights hereunder, including the
right to prepare for sale and sell any and all Inventory and Equipment now or
hereafter owned by any Grantor and now or hereafter covered by such licenses,
and (c) shall have the right to request that any Stock that is pledged hereunder
be registered in the name of Agent or any of its nominees.
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10. Agent Appointed
Attorney-in-Fact. Each Grantor hereby irrevocably appoints
Agent, its attorney-in-fact, with full authority in the place and
stead of such Grantor and in the name of such Grantor or otherwise, at such time
as a Guaranty Event of Default has occurred and is continuing, but subject to
the terms of the Intercreditor Agreement and the Guaranty, to take any action
and to execute any instrument which Agent, may reasonably deem necessary or
advisable to accomplish the purposes of this Agreement, including:
(a) to
ask, demand, collect, xxx for, recover, compromise, receive and give acquittance
and receipts for moneys due and to become due under or in connection with the
Accounts or any other Collateral of such Grantor;
(b) to
receive and open all mail addressed to such Grantor and to notify postal
authorities to change the address for the delivery of mail to such Grantor to
that of Agent;
(c) to
receive, indorse, and collect any drafts or other instruments, documents,
Negotiable Collateral or Chattel Paper;
(d) to
file any claims or take any action or institute any proceedings which Agent may
deem necessary or desirable for the collection of any of the Collateral of such
Grantor or otherwise to enforce the rights of Agent with respect to any of the
Collateral;
(e) to
repair, alter, or supply goods, if any, necessary to fulfill in whole or in part
the purchase order of any Person obligated to such Grantor in respect of any
Account of such Grantor;
(f) to
use any labels, Patents, Trademarks, trade names, URLs, domain names, industrial
designs, Copyrights, advertising matter or other industrial or intellectual
property rights, in advertising for sale and selling Inventory and other
Collateral and to collect any amounts due under Accounts, contracts or
Negotiable Collateral of such Grantor; and
(g) Agent,
on behalf of the Lender Group, shall have the right, but shall not be obligated,
to bring suit in its own name to enforce the Trademarks, Patents, Copyrights and
Intellectual Property Licenses and, if Agent shall commence any such suit, the
appropriate Grantor shall, at the request of Agent, do any and all lawful acts
and execute any and all proper documents reasonably required by Agent in aid of
such enforcement.
To the
extent permitted by law, each Grantor hereby ratifies all that such
attorney-in-fact shall lawfully do or cause to be done by virtue
hereof. This power of attorney is coupled with an interest and shall
be irrevocable until this Agreement is terminated.
11. Agent May
Perform. If any of Grantors fails to perform any agreement
contained herein, Agent may itself perform, or cause performance of, such
agreement, and the reasonable expenses of Agent incurred in connection therewith
shall be payable, jointly and severally, by Grantors.
12. Agent’s
Duties. The powers conferred on Agent hereunder are solely to
protect Agent’s interest in the Collateral, for the benefit of the Lender Group,
and shall not impose any duty upon Agent to exercise any such
powers. Except for the safe custody of any Collateral in its actual
possession and the accounting for moneys actually received by it
- 11 -
hereunder,
Agent shall have no duty as to any Collateral or as to the taking of any
necessary steps to preserve rights against prior parties or any other rights
pertaining to any Collateral. Agent shall be deemed to have exercised
reasonable care in the custody and preservation of any Collateral in its actual
possession if such Collateral is accorded treatment substantially equal to that
which Agent accords its own property.
13. Collection of Accounts,
General Intangibles and Negotiable Collateral. At any time
upon the occurrence and during the continuation of a Guaranty Event of Default,
but subject to the terms of the Intercreditor Agreement and the Guaranty, Agent
or Agent’s designee may (a) notify Account Debtors of any Grantor that the
Accounts, General Intangibles, Chattel Paper or Negotiable Collateral have been
assigned to Agent, for the benefit of the Lender Group, or that Agent has a
security interest therein, and (b) collect the Accounts, General Intangibles and
Negotiable Collateral directly, and any collection costs and expenses shall
constitute part of such Grantor’s Secured Obligations under the Loan
Documents.
14. Disposition of Pledged
Interests by Agent. None of the Pledged Interests existing as
of the date of this Agreement are, and none of the Pledged Interests hereafter
acquired on the date of acquisition thereof will be, registered or qualified
under the various federal or state securities laws of the United States and
disposition thereof after a Guaranty Event of Default, subject to the terms of
the Intercreditor Agreement and the Guaranty, may be restricted to one or more
private (instead of public) sales in view of the lack of such
registration. Each Grantor understands that in connection with such
disposition, Agent may approach only a restricted number of potential purchasers
and further understands that a sale under such circumstances may yield a lower
price for the Pledged Interests than if the Pledged Interests were registered
and qualified pursuant to federal and state securities laws and sold on the open
market. Each Grantor, therefore, agrees that: (a) if Agent
shall, pursuant to the terms of this Agreement, sell or cause the Pledged
Interests or any portion thereof to be sold at a private sale, Agent shall have
the right to rely upon the advice and opinion of any nationally recognized
brokerage or investment firm (but shall not be obligated to seek such advice and
the failure to do so shall not be considered in determining the commercial
reasonableness of such action) as to the best manner in which to offer the
Pledged Interest or any portion thereof for sale and as to the best price
reasonably obtainable at the private sale thereof; and (b) such reliance shall
be conclusive evidence that Agent has handled the disposition in a commercially
reasonable manner.
15. Voting
Rights.
(a) Upon
the occurrence and during the continuation of a Guaranty Event of Default, but
subject to the terms of the Intercreditor Agreement and the Guaranty, (i) Agent
may, at its option, and with 2 Business Days prior notice to any Grantor, and in
addition to all rights and remedies available to Agent under any other
agreement, at law, in equity, or otherwise, exercise all voting rights, and all
other ownership or consensual rights in respect of the Pledged Interests owned
by such Grantor, but under no circumstances is Agent obligated by the terms of
this Agreement to exercise such rights, and (ii) if Agent duly exercises its
right to vote any of such Pledged Interests, each Grantor hereby appoints Agent,
such Grantor’s true and lawful attorney-in-fact and IRREVOCABLE PROXY to vote
such Pledged Interests in any manner Agent deems advisable for or against all
matters submitted or which may be submitted to a vote of shareholders, partners
or members, as the case may be. The power-of-attorney granted hereby
is coupled with an interest and shall be irrevocable.
- 12 -
(b) Upon
the occurrence and during the continuance of a Guaranty Event of Default, but
subject to the terms of the Intercreditor Agreement and the Guaranty, for so
long as any Grantor shall have the right to vote the Pledged Interests owned by
it, such Grantor covenants and agrees that it will not, without the prior
written consent of Agent, vote or take any consensual action with respect to
such Pledged Interests which would materially adversely affect the rights of
Agent and the other members of the Lender Group or the value of the Pledged
Interests.
16. Remedies. Upon
the occurrence and during the continuance of a Guaranty Event of Default, but
subject to the terms of the Intercreditor Agreement and the
Guaranty:
(a) Agent
may exercise in respect of the Collateral, in addition to other rights and
remedies provided for herein, in the Guaranty or the other Loan Documents, or
otherwise available to it, all the rights and remedies of a secured party on
default under the Code or any other applicable law. Without limiting
the generality of the foregoing, each Grantor expressly agrees that, in any such
event, Agent without demand of performance or other demand, advertisement or
notice of any kind (except a notice specified below of time and place of public
or private sale) to or upon any of Grantors or any other Person (all and each of
which demands, advertisements and notices are hereby expressly waived to the
maximum extent permitted by the Code or any other applicable law), may take
immediate possession of all or any portion of the Collateral and (i) require
Grantors to, and each Grantor hereby agrees that it will at its own expense and
upon request of Agent forthwith, assemble all or part of the Collateral as
directed by Agent and make it available to Agent at one or more
locations where such Grantor regularly maintains Inventory, and (ii) without
notice except as specified below, sell the Collateral or any part thereof in one
or more parcels at public or private sale, at any of Agent’s offices or
elsewhere, for cash, on credit, and upon such other terms as Agent may deem
commercially reasonable. Each Grantor agrees that, to the extent
notice of sale shall be required by law, at least 10 days notice to any of
Grantors of the time and place of any public sale or the time after which any
private sale is to be made shall constitute reasonable notification and
specifically such notice shall constitute a reasonable “authenticated
notification of disposition” within the meaning of Section 9-611 of the
Code. Agent shall not be obligated to make any sale of Collateral
regardless of notice of sale having been given. Agent may adjourn any
public or private sale from time to time by announcement at the time and place
fixed therefor, and such sale may, without further notice, be made at the time
and place to which it was so adjourned.
(b) Agent
is hereby granted a license or other right to use, without liability for
royalties or any other charge, each Grantor’s labels, Patents, Copyrights,
rights of use of any name, trade secrets, trade names, Trademarks, service marks
and advertising matter, URLs, domain names, industrial designs, other industrial
or intellectual property or any property of a similar nature, whether owned by
any of Grantors or with respect to which any of Grantors have rights under
license, sublicense, or other agreements, as it pertains to the Collateral, in
preparing for sale, advertising for sale and selling any Collateral, and each
Grantor’s rights under all licenses and all franchise agreements shall inure to
the benefit of Agent.
- 13 -
(c) Any
cash held by Agent as Collateral and all cash proceeds received by Agent in
respect of any sale of, collection from, or other realization upon all or any
part of the Collateral shall be applied against the Secured Obligations in the
order set forth in the Credit Agreement. In the event the proceeds of
Collateral are insufficient to satisfy all of the Secured Obligations in full,
each Grantor shall remain jointly and severally liable for any such
deficiency.
(d) Each
Grantor hereby acknowledges that the Secured Obligations arose out of a
commercial transaction, and agrees that if a Guaranty Event of Default shall
occur and be continuing Agent shall have the right to an immediate writ of
possession without notice of a hearing. Agent shall have the right to
the appointment of a receiver for the properties and assets of each of Grantors,
and each Grantor hereby consents to such rights and such appointment and hereby
waives any objection such Grantors may have thereto or the right to have a bond
or other security posted by Agent.
17. Remedies
Cumulative. Each right, power, and remedy of Agent as provided
for in this Agreement, the Guaranty or in the other Loan Documents or now or
hereafter existing at law or in equity or by statute or otherwise shall be
cumulative and concurrent and shall be in addition to every other right, power,
or remedy provided for in this Agreement, the Guaranty or in the other Loan
Documents or now or hereafter existing at law or in equity or by statute or
otherwise, and the exercise or beginning of the exercise by Agent, of any one or
more of such rights, powers, or remedies shall not preclude the simultaneous or
later exercise by Agent of any or all such other rights, powers, or
remedies.
18. Marshaling. Agent
shall not be required to marshal any present or future collateral security
(including but not limited to the Collateral) for, or other assurances of
payment of, the Secured Obligations or any of them or to resort to such
collateral security or other assurances of payment in any particular order, and
all of its rights and remedies hereunder and in respect of such collateral
security and other assurances of payment shall be cumulative and in addition to
all other rights and remedies, however existing or arising. To the
extent that it lawfully may, each Grantor hereby agrees that it will not invoke
any law relating to the marshaling of collateral which might cause delay in or
impede the enforcement of Agent’s rights and remedies under this Agreement or
under any other instrument creating or evidencing any of the Secured Obligations
or under which any of the Secured Obligations is outstanding or by which any of
the Secured Obligations is secured or payment thereof is otherwise assured, and,
to the extent that it lawfully may, each Grantor hereby irrevocably waives the
benefits of all such laws.
19. Indemnity and
Expenses.
(a) Each
Grantor agrees to indemnify Agent and the other members of the Lender Group from
and against all claims, lawsuits and liabilities (including reasonable attorneys
fees) growing out of or resulting from this Agreement (including enforcement of
this Agreement) or any other Loan Document to which such Grantor is a party,
except claims, losses or liabilities resulting from the gross negligence or
willful misconduct of the party seeking indemnification as determined by a final
non-appealable order of a court of competent jurisdiction, or from any such
indemnified Person breaching its material obligations under the Credit
Agreement. This provision shall survive the termination of this
Agreement, the Guaranty and the Credit Agreement and the repayment of the
Secured Obligations.
- 14 -
(b) Grantors,
jointly and severally, shall, upon demand, pay to Agent all the Lender Group
Expenses (subject to and included in the Guaranty Limit (as defined in the
Guaranty), the Guaranty and the other Loan Documents) which Agent may incur in
connection with (i) the administration of this Agreement, (ii) the custody,
preservation, use or operation of, or, upon a Guaranty Event of Default, the
sale of, collection from, or other realization upon, any of the Collateral in
accordance with this Agreement, the Guaranty and the other Loan Documents, (iii)
the exercise or enforcement of any of the rights of Agent hereunder or (iv) the
failure by any of Grantors to perform or observe any of the provisions hereof,
if demand for payment of such Lender Group Expenses has been made by Agent to
any Borrower or Borrowers and payment for such Lender Group Expenses has not
been received by Agent within 30 days of such demand.
(c) Notwithstanding
the foregoing, the maximum liability of the Grantors to the Agent and the Lender
Group hereunder shall not exceed the Guaranty Limit.
20. Merger, Amendments;
Etc. THIS AGREEMENT, TOGETHER WITH THE GUARANTY AND THE OTHER
LOAN DOCUMENTS, REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT
BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN AGREEMENTS BETWEEN
THE PARTIES. No waiver of any provision of this Agreement, and no
consent to any departure by any of Grantors herefrom, shall in any event be
effective unless the same shall be in writing and signed by Agent, and then such
waiver or consent shall be effective only in the specific instance and for the
specific purpose for which given. No amendment of any provision of
this Agreement shall be effective unless the same shall be in writing and signed
by Agent and each of Grantors to which such amendment applies.
21. Addresses for
Notices. All notices and other communications provided for
hereunder shall be given in the form and manner and delivered to Agent at its
address specified in the Credit Agreement, and to any of the Grantors at their
respective addresses specified in the Guaranty, as applicable, or, as to any
party, at such other address as shall be designated by such party in a written
notice to the other party.
22. Continuing Security
Interest: Assignments under Credit Agreement. This Agreement
shall create a continuing security interest in the Collateral and shall (a)
remain in full force and effect until the earliest to occur of (I) the
Obligations have been paid in full in cash in accordance with the provisions of
the Credit Agreement and the Commitments have expired or have been terminated or
(II) the Guaranty has been terminated in accordance with the terms therein,
(III) the Grantors have made the payments required under the Guaranty, subject
to the Guaranty Limit, or (IV) with respect to one or more Grantors and the
Collateral owned or held by such entities, until such Grantor or Grantors are
released as Guarantors from the Guaranty pursuant to Section 17 of the
Guaranty, (b) be binding upon each of Grantors, and their respective successors
and assigns, and (c) inure to the benefit of, and be enforceable by, Agent, and
its successors, transferees and assigns. Without limiting the
generality of the foregoing clause (c), any Lender may, in accordance with the
provisions of the Credit Agreement, assign or otherwise transfer all or any
portion of its rights and obligations under the Credit Agreement to any other
Person, and such other Person shall thereupon become vested with all the
benefits in respect thereof granted to such the Lender herein or
otherwise. Upon the earlier of (i) payment in full in cash of the
Obligations in
- 15 -
accordance
with the provisions of the Credit Agreement and the expiration or termination of
the Commitments or (ii) the termination of the Guaranty, the Security Interest
granted hereby shall terminate and all rights to the Collateral shall revert to
Grantors or any other Person entitled thereto. At such time, Agent
will authorize the filing of appropriate termination statements to terminate
such Security Interests. No transfer or renewal, extension,
assignment, or termination of this Agreement or of the Credit Agreement, any
other Loan Document, or any other instrument or document executed and delivered
by any Grantor to Agent nor any other loans made by any the Lender to Borrowers,
nor the taking of further security, nor the retaking or re-delivery of the
Collateral to Grantors, or any of them, by Agent, nor any other act of the
Lender Group, or any of them, shall release any of Grantors from any obligation,
except a release or discharge executed in writing by Agent in accordance with
the provisions of the Credit Agreement. Agent shall not by any act,
delay, omission or otherwise, be deemed to have waived any of its rights or
remedies hereunder, unless such waiver is in writing and signed by Agent and
then only to the extent therein set forth. A waiver by Agent of any
right or remedy on any occasion shall not be construed as a bar to the exercise
of any such right or remedy which Agent would otherwise have had on any other
occasion.
23. Governing
Law.
(a) THE VALIDITY OF THIS AGREEMENT, THE
GUARANTY AND THE OTHER LOAN DOCUMENTS (UNLESS EXPRESSLY PROVIDED TO THE CONTRARY
IN ANOTHER LOAN DOCUMENT IN RESPECT OF SUCH OTHER LOAN DOCUMENT), THE
CONSTRUCTION, INTERPRETATION, AND ENFORCEMENT HEREOF AND THEREOF, AND THE RIGHTS
OF THE PARTIES HERETO AND THERETO WITH RESPECT TO ALL MATTERS ARISING HEREUNDER
OR THEREUNDER OR RELATED HERETO OR THERETO SHALL BE DETERMINED UNDER, GOVERNED
BY, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK.
(b) THE PARTIES AGREE THAT ALL ACTIONS OR
PROCEEDINGS ARISING IN CONNECTION WITH THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS SHALL BE TRIED AND LITIGATED ONLY IN THE STATE AND, TO THE EXTENT
PERMITTED BY APPLICABLE LAW, FEDERAL COURTS LOCATED IN THE COUNTY OF NEW YORK,
STATE OF NEW YORK; PROVIDED, HOWEVER, THAT ANY SUIT SEEKING ENFORCEMENT
AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT AGENT’S OPTION, IN
THE COURTS OF ANY JURISDICTION WHERE AGENT ELECTS TO BRING SUCH ACTION OR WHERE
SUCH COLLATERAL OR OTHER PROPERTY MAY BE FOUND. AGENT AND EACH
GRANTOR WAIVE, TO THE EXTENT PERMITTED UNDER APPLICABLE LAW, ANY RIGHT EACH MAY
HAVE TO ASSERT THE DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT TO VENUE TO THE EXTENT
ANY PROCEEDING IS BROUGHT IN ACCORDANCE WITH THIS SECTION
23(b).
(c) TO THE MAXIMUM EXTENT PERMITTED BY
APPLICABLE LAW, AGENT AND EACH GRANTOR HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A
JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS
AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED
- 16 -
THEREIN, INCLUDING CONTRACT CLAIMS,
TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY
CLAIMS. AGENT AND EACH GRANTOR REPRESENT THAT EACH HAS REVIEWED THIS
WAIVER AND EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING
CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF LITIGATION, A COPY
OF THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE
COURT.
24. New
Subsidiaries. After the date hereof, any new direct or
indirect Subsidiary (whether by acquisition or creation) of a Grantor is
required to enter into this Agreement by executing and delivering in favor of
Agent a supplement to this Agreement in the form of Annex
1. Upon the execution and delivery of Annex 1 by such new
Subsidiary, such Subsidiary shall become a Grantor hereunder with the same force
and effect as if originally named as a Grantor herein. The execution
and delivery of any instrument adding an additional Grantor as a party to this
Agreement shall not require the consent of any Grantor hereunder. The
rights and obligations of each Grantor hereunder shall remain in full force and
effect notwithstanding the addition of any new Grantor hereunder.
25. Agent. Each
reference herein to any right granted to, benefit conferred upon or power
exercisable by the “Agent” shall be a reference to Agent, for the benefit of the
Lender Group.
26. Intercreditor
Agreement. Notwithstanding anything herein to the contrary,
the liens and security interests granted to the Agent pursuant to the Loan
Documents in the Collateral and the exercise of any right or remedy by the Agent
with respect to the Collateral hereunder or under any other Loan Document are
subject to the provisions of the Intercreditor Agreement. In the
event of any conflict between the terms of the Intercreditor Agreement and this
Agreement with respect to (a) the priority of liens and security interests
granted to the Agent in the Collateral pursuant to the Loan Documents or (b) the
rights of the Agent or any Lender under this Agreement, the terms of the
Intercreditor Agreement shall govern and control as between the Agent and the
Lenders, on the one hand, and the Existing Lenders pursuant to the their
respective Existing Credit Agreement, on the other hand.
26. Miscellaneous.
(a) This
Agreement may be executed in any number of counterparts and by different parties
on separate counterparts, each of which, when executed and delivered, shall be
deemed to be an original, and all of which, when taken together, shall
constitute but one and the same Agreement. Delivery of an executed
counterpart of this Agreement by telefacsimile or other electronic method of
transmission shall be equally as effective as delivery of an original executed
counterpart of this Agreement. Any party delivering an executed
counterpart of this Agreement by telefacsimile or other electronic method of
transmission also shall deliver an original executed counterpart of this
Agreement but the failure to deliver an original executed counterpart shall not
affect the validity, enforceability, and binding effect of this
Agreement. The foregoing shall apply to each other Loan Document
mutatis
mutandis.
- 17 -
(b) Any
provision of this Agreement which is prohibited or unenforceable shall be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof in that jurisdiction or affecting
the validity or enforceability of such provision in any other
jurisdiction.
(c) Headings
used in this Agreement are for convenience only and shall not be used in
connection with the interpretation of any provision hereof.
(d) The
pronouns used herein shall include, when appropriate, either gender and both
singular and plural, and the grammatical construction of sentences shall conform
thereto.
(e) Unless
the context of this Agreement or any other Loan Document clearly requires
otherwise, references to the plural include the singular, references to the
singular include the plural, the terms “includes” and “including” are
not limiting, and the term “or” has, except where otherwise indicated, the
inclusive meaning represented by the phrase “and/or.” The words
“hereof,” “herein,” “hereby,” “hereunder,” and similar terms in this Agreement
or any other Loan Document refer to this Agreement or such other Loan Document,
as the case may be, as a whole and not to any particular provision of this
Agreement or such other Loan Document, as the case may be. Section,
subsection, clause, schedule, and exhibit references herein are to this
Agreement unless otherwise specified. Any reference in this Agreement
or in any other Loan Document to any agreement, instrument, or document shall
include all alterations, amendments, changes, extensions, modifications,
renewals, replacements, substitutions, joinders, and supplements, thereto and
thereof, as applicable (subject to any restrictions on such alterations,
amendments, changes, extensions, modifications, renewals, replacements,
substitutions, joinders, and supplements set forth herein). Any
reference herein or in any other Loan Document to the satisfaction or repayment
in full of the Obligations shall mean the repayment in full in cash (or cash
collateralization in accordance with the terms hereof) of all Obligations other
than unasserted contingent indemnification Obligations. Any reference
herein to any Person shall be construed to include such Person’s successors and
assigns. Any requirement of a writing contained herein or in any
other Loan Document shall be satisfied by the transmission of a Record and any
Record so transmitted shall constitute a representation and warranty as to the
accuracy and completeness of the information contained therein.
[Remainder
of Page Intentionally Left Blank]
- 18 -
IN
WITNESS WHEREOF, the undersigned parties hereto have executed this Agreement by
and through their duly authorized officers, as of the day and year first above
written.
| AGENT |
GUARANTORS
|
|||
|
ABLECO
FINANCE LLC
as Agent, |
HANDY
& XXXXXX, a New York corporation
|
|||
|
By:
|
/s/ |
By:
|
/s/ | |
|
Title:
|
Title:
|
|||
|
|
||||
|
OMG,
INC., a Delaware corporation
|
||||
|
By:
|
/s/ | |||
|
Title:
|
||||
|
CONTINENTAL
INDUSTRIES, INC., an Oklahoma corporation
|
||||
|
By:
|
/s/ | |||
|
Title:
|
||||
|
MARYLAND
SPECIALTY WIRE, INC., a Delaware corporation
|
||||
|
By:
|
/s/ | |||
|
Title:
|
||||
|
HANDY
& XXXXXX TUBE COMPANY, INC., a Delaware corporation
|
||||
|
By:
|
/s/ | |||
|
Title:
|
||||
|
CAMDEL
METALS CORPORATION, a Delaware corporation
|
||||
|
By:
|
/s/ | |||
|
Title:
|
||||
|
XXXXXXXX
METAL COATING CORPORATION. A Delaware corporation
|
||||
|
By:
|
/s/ | |||
|
Title:
|
||||
|
MICRO-TUBE
FABRICATORS, INC.. a Delaware corporation
|
||||
|
By:
|
/s/ | |||
|
Title:
|
||||
|
INDIANA
TUBE CORPORATION, a Delaware corporation
|
||||
|
By:
|
/s/ | |||
|
Title:
|
||||
|
XXXXX-XXXXXXXX,
INC., a Wisconsin corporation
|
||||
|
By:
|
/s/ | |||
|
Title:
|
||||
|
HANDY
& XXXXXX ELECTRONIC MATERIALS CORPORATION, a Florida
corporation
|
||||
|
By:
|
/s/ | |||
|
Title:
|
||||
|
SUMCO
INC., an Indiana corporation
|
||||
|
By:
|
/s/ | |||
|
Title:
|
||||
|
OMG
ROOFING, INC., a Delaware corporation
|
||||
|
By:
|
/s/ | |||
|
Title:
|
||||
|
OMNI
TECHNOLOGIES CORPORATION OF DANVILLE, a New Hampshire
corporation
|
||||
|
By:
|
/s/ | |||
|
Title:
|
||||
|
HANDY
& XXXXXX OF CANADA, LIMITED, an Ontario corporation
|
||
|
By:
|
/s/ | |
|
Title:
|
||
|
ELE
CORPORATION, a California corporation
|
||
|
By:
|
/s/ | |
|
Title:
|
||
|
ALLOY
RING SERVICE INC., a Delaware corporation
|
||
|
By:
|
/s/ | |
|
Title:
|
||
|
XXXXXX
RADIATOR CORPORATION, a Texas corporation
|
||
|
By:
|
/s/ | |
|
Title:
|
||
|
H&H
PRODUCTIONS, INC., a Delaware corporation
|
||
|
By:
|
/s/ | |
|
Title:
|
||
|
HANDY
& XXXXXX AUTOMOTIVE GROUP, INC., a Delaware
corporation
|
||
|
By:
|
/s/ | |
|
Title:
|
||
|
HANDY
& XXXXXX INTERNATIONAL, LTD., a Delaware
corporation
|
||
|
By:
|
/s/ | |
|
Title:
|
||
3
Security
Agreement
|
HANDY
& XXXXXX PERU, INC., a Delaware corporation
|
||
|
By:
|
/s/ | |
|
Title:
|
||
|
KJ-VMI
REALTY, INC., a Delaware corporation
|
||
|
By:
|
/s/ | |
|
Title:
|
||
|
XXX-XXXX
REALTY, INC., a Delaware corporation
|
||
|
By:
|
/s/ | |
|
Title:
|
||
|
PLATINA
LABORATORIES, INC., a Delaware corporation
|
||
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By:
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/s/ | |
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Title:
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SHEFFIELD
STREET CORPORATION, a Connecticut corporation
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By:
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/s/ | |
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Title:
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SWM,
INC., a Delaware corporation
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By:
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/s/ | |
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Title:
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WILLING
B WIRE CORPORATION, a Delaware corporation
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By:
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/s/ | |
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Title:
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4
Security
Agreement
ANNEX 1
TO SECURITY AGREEMENT
FORM OF
SUPPLEMENT
Supplement
No. ____ (this “Supplement”) dated as
of _______________, to the Security Agreement dated as of February 14, 2008 (as
amended, restated, supplemented or otherwise modified from time to time, the
“Security
Agreement”) by each of the parties listed on the signature pages thereto
and those additional entities that thereafter become parties thereto
(collectively, jointly and severally, “Grantors” and each individually “Grantor”) and ABLECO
FINANCE LLC, in its capacity as Agent for the Lender Group (together with the
successors, “Agent”).
W I T N E
S S E T H:
WHEREAS,
pursuant to that certain Credit Agreement dated as of July 17, 2007 (as amended,
restated, supplemented or otherwise modified from time to time, the “Credit Agreement”) by
and among Bairnco Corporation (“Parent”), each of
Parent’s Subsidiaries identified on the signature pages thereto (such
Subsidiaries, together with Parent, are referred to hereinafter each
individually as a “Borrower”, and
individually and collectively, jointly and severally, as “Borrowers”), the
lenders party thereto as “Lenders” (“Lenders”), and Agent,
the Lender Group is willing to make certain financial accommodations available
to Borrowers from time to time pursuant to the terms and conditions thereof;
and
WHEREAS,
capitalized terms used herein and not otherwise defined herein shall have the
meanings assigned to such terms in the Security Agreement or the Credit
Agreement; and
WHEREAS,
Grantors have entered into the Security Agreement in order to induce the Lender
Group to make certain financial accommodations to Borrower; and
WHEREAS,
pursuant to Section
24 of the Security Agreement, new direct or indirect Subsidiaries of any
Borrower or Guarantor, must execute and deliver certain Loan Documents,
including the Security Agreement, and the execution of the Security Agreement by
the undersigned new Grantor or Grantors (collectively, the “New Grantors”) may be
accomplished by the execution of this Supplement in favor of Agent, for the
benefit of the Lender Group;
NOW,
THEREFORE, for and in consideration of the foregoing and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
each New Grantor hereby agrees as follows:
1. In
accordance with Section 24 of the
Security Agreement, each New Grantor, by its signature below, becomes a
“Grantor” under the Security Agreement with the same force and effect as if
originally named therein as a “Grantor” and each New Grantor hereby (a) agrees
to all of the terms and provisions of the Security Agreement applicable to it as
a “Grantor” thereunder and (b) represents and warrants that the representations
and warranties made by it as a “Grantor” thereunder are true and correct on and
as of the date hereof. In furtherance of the foregoing, each New
Grantor, as security for the payment and performance in full of the Secured
Obligations, does hereby grant, assign, and pledge to Agent, for the benefit of
the Lender Group, a security interest in and security title to all assets of
such New Grantor including, all property of the type described in Section 2 of the
Security Agreement to secure the full and prompt payment of the Secured
Obligations, including, any interest thereon. Each reference to a
“Grantor” in the Security Agreement shall be deemed to include each New
Grantor. The Security Agreement is incorporated herein by
reference.
2. Each
New Grantor represents and warrants to Agent and the Lender Group that this
Supplement has been duly executed and delivered by such New Grantor and
constitutes its legal, valid and binding obligation, enforceable against it in
accordance with its terms, except as enforceability thereof may be limited by
bankruptcy, insolvency, reorganization, fraudulent transfer, moratorium or other
similar laws affecting creditors’ rights generally and general principles of
equity (regardless of whether such enforceability is considered in a proceeding
at law or in equity).
3. This
Supplement may be executed in multiple counterparts, each of which shall be
deemed to be an original, but all such separate counterparts shall together
constitute but one and the same instrument. Delivery of a counterpart
hereof by facsimile transmission or by e-mail transmission shall be as effective
as delivery of a manually executed counterpart hereof.
4. Except
as expressly supplemented hereby, the Security Agreement shall remain in full
force and effect.
5. This
Supplement shall be construed in accordance with and governed by the laws of the
State of New York, without regard to the conflict of laws principles
thereof.
[REMAINDER
OF THIS PAGE INTENTIONALLY LEFT BLANK]
IN
WITNESS WHEREOF, each New Grantor and Agent have duly executed this Supplement
to the Security Agreement as of the day and year first above
written.
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NEW
GRANTORS:
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[Name
of New Grantor]
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By:
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Name:
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Title:
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[Name
of New Grantor]
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By:
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Name:
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Title:
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AGENT:
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ABLECO
FINANCE LLC
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By:
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Name:
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Title:
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