SECURITY AGREEMENT
SECURITY AGREEMENT dated as of August 18, 1997, among PAKISTAN
WIRELESS HOLDINGS LIMITED, a private company formed under the laws of
Mauritius (the "GRANTOR"), and TORONTO DOMINION INVESTMENTS, INC., as agent
(in such capacity, together with its successors in such capacity, the
"AGENT") for the Lenders, as that term is defined in the Loan Agreement dated
as of the date of this Agreement among the Grantor and the Initial Lenders
named therein (as the same may be amended, modified, restated or supplemented
from time to time, the "LOAN AGREEMENT"). Capitalized terms used but not
defined herein have the meanings given to such terms in the Loan Agreement.
The Initial Lenders have agreed to make certain loans to the Grantor
pursuant to, and subject to the terms and conditions specified in, the Loan
Agreement. The obligation of the Initial Lenders to lend under the Loan
Agreement are conditioned on, among other things, the execution and delivery
by the Grantor of this Agreement.
Accordingly, the Grantor and the Agent, on behalf of itself and the
Lenders as holders of the Obligations, hereby agree as follows:
1. DEFINITIONS.
As used herein, the following terms will have the following meanings:
"ACCOUNTS" means "accounts" (as that term is defined in the UCC) and
all rights to receive payments, whether for goods sold or leased, for
services rendered or otherwise, whether or not earned by performance,
together with all security interests or other security held by or granted to
the Grantor to secure such rights to payment, all other rights related
thereto including any right of stoppage in transit and all rights in any of
such sold or leased goods which are returned or repossessed, in each case
whether now in existence or hereafter acquired.
"CHATTEL PAPER" means any writing or group of writings which
evidences both a monetary obligation and a security interest in or a lease of
specific goods and all "chattel paper" (as defined in the UCC).
"COLLATERAL" means all personal property, wherever located, in which
the Grantor now has or hereafter acquires any right, title or interest
(including all Accounts, Chattel Paper, Contracts, Documents, Equipment,
General Intangibles, Instruments, Intellectual Property Collateral,
Inventory, Pledged Deposits, cash, bank accounts, special collateral
accounts, "uncertificated securities" (as that term is defined in the UCC)
and all books and records, customer lists and credit files related to any of
the foregoing), all Fixtures, and all proceeds (including all "proceeds," as
that term is defined in the Code), insurance proceeds, rents, profits and
products of the foregoing, but excluding Excluded Contracts and Excluded
Intellectual
Property Collateral (provided that payments paid or payable thereunder and
any other proceeds relating thereto or arising therefrom are not excluded and
constitute Collateral).
"CONTRACTS" means all contracts, agreements and other similar
consensual obligations, as the same may from time to time be amended,
supplemented, modified or otherwise in effect from time to time, including
(a) all rights to receive moneys due and to become due thereunder xxxx
connection therewith, (b) all rights to damages arising out of any breach or
default in respect thereof and (c) all rights to perform and to exercise
remedies thereunder.
"DOCUMENTS" means all documents of title and goods evidenced
thereby, including all bills of lading, dock warrants, dock receipts, all
"documents" (as that term is defined in the Code), warehouse receipts and
orders for the delivery of goods, and any other document which in the regular
course of business or financing is treated as adequately evidencing that the
Person in possession thereof is entitled to receive, hold and dispose of such
document and the goods it covers.
"EQUIPMENT" means any "equipment," as such term is defined in the
UCC, now or hereafter acquired and, in any event, will include all machinery,
equipment, furnishings, movable trade fixtures and vehicles now or hereafter
owned by the Grantor and any and all additions, substitutions and
replacements of any of the foregoing, wherever located, together with all
attachments, components, parts, equipment and accessories installed thereon
or affixed thereto.
"EXCLUDED CONTRACTS" means any Contract to the extent, and only to
the extent, that such Contract contains a legally enforceable provision which
would be breached by the grant of the security interest created herein
pursuant to the terms of this Agreement; PROVIDED, HOWEVER, that if and when
any prohibition on the assignment, pledge or grant of a security interest in
such Contract is removed, the Agent will be deemed to have been granted a
security interest in such Contract as of the date hereof, and the Collateral
will be deemed to include such Contract.
"EXCLUDED INTELLECTUAL PROPERTY COLLATERAL" means any Intellectual
Property Collateral to the extent, and only to the extent, that such
Intellectual Property Collateral is governed by or contains a legally
enforceable provision which would be breached by the grant of the security
interest created herein pursuant to the terms of this Agreement; PROVIDED,
HOWEVER, that if and when any prohibition on the assignment, pledge or grant
of a security interest in such Intellectual Property Collateral is removed,
the Agent will be deemed to have been granted a security interest in such
Intellectual Property Collateral as of the date hereof, and the Collateral
will be deemed to include such Intellectual Property Collateral.
"GENERAL INTANGIBLES" means all intangible personal property,
including all contract rights, rights to receive payments of money, choses in
action, judgments, tax refunds and tax refund claims, Intellectual Property
Collateral, leasehold interests in real or personal property, rights to
receive rentals of real or personal property or payments under letters of
credit,
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insurance proceeds, know-how, trade secrets, goodwill, computer software,
guarantee claims and all "general intangibles" (as that term is defined in
the UCC).
"INSTRUMENTS" means all "instruments" (as that term is defined in
the UCC), "certificated securities" (as that term is defined in the UCC) and
any replacements therefor, and other writings which evidence a right to the
payment of money (whether absolute or contingent) and which are not
themselves security agreements or leases and are of a type which in the
ordinary course of business are transferred by delivery with any necessary
endorsement or assignment, including all checks, drafts, notes, bonds,
debentures, government securities, certificates of deposit, letters of
credit, preferred and common stocks, options and warrants.
"INTELLECTUAL PROPERTY COLLATERAL" means all patents, patent
applications, patent disclosures and inventions (whether or not patentable
and whether or not reduced to practice); all trademarks, service marks, trade
dress, trade names and corporate names and all the goodwill associated
therewith; all registered and unregistered statutory and common law
copyrights; all registrations, applications and renewals for any of the
foregoing; all trade secrets, confidential information, ideas, formulae,
compositions, know-how, manufacturing and production processes and
techniques, research and development information, drawings, specifications,
designs, plans, improvements, proposals, technical and computer data,
financial, business and marketing plans, and customer and supplier lists and
related information; all other proprietary rights (including all computer
software and documentation and all license agreements and sublicense
agreements to and from third parties relating to any of the foregoing); all
copies and tangible embodiments of the foregoing (in whatever form or
medium); all damages and payments for past, present and future infringements
of the foregoing; all royalties and income due with respect to the foregoing;
and the right to xxx and recover for past, present and future infringements
of the foregoing.
"INVENTORY" means all "inventory" (as that term is defined in the
UCC), raw materials, work in process, finished goods, returned or repossessed
goods, goods held for sale or lease or furnished or to be furnished under
contracts of service and goods released under trust receipts or similar
Documents.
"OBLIGATIONS" means all obligations of the Grantor pursuant to this
Agreement and the other Loan Agreements.
"PLEDGED DEPOSITS" means all deposits of money, whether or not
evidenced by certificates, with any lender rights to receive interest on such
deposits and all other sums credited by or due from third parties with
respect thereto.
"RECEIVABLES" means the Accounts, Chattel Paper, Pledged Deposits,
Documents, General Intangibles, Intellectual Property Collateral representing
rights to the payment of money (however arising), and any related
Instruments.
"VEHICLES" means all cars, trucks, trailers, construction and
earth-moving equipment and other vehicles covered by a certificate of title
of any jurisdiction and, in any event, will include all tires and other
appurtenances to any of the foregoing.
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2. GRANT OF SECURITY INTEREST.
The Grantor hereby pledges, and grants a continuing security
interest in, and a right of setoff against, the Collateral to the Agent, for
the benefit of the Agent and the Lenders, to secure payment, performance and
observance of the Obligations.
3. REPRESENTATIONS AND WARRANTIES.
The Grantor makes the representations, warranties and covenants set
forth in this Section 3 to the Agent, for the benefit of the Agent and the
Lenders.
3.1 NECESSARY FILINGS. All filings, registrations (except
registrations in the U.S. Copyright Office with respect to copyright
Collateral and filings in the U.S. Patent and Trademark Office with respect
to intent to use trademark Collateral and any filings necessary to perfect
the security interest granted hereunder in non-U.S. Intellectual Property
Collateral) and recordings necessary or appropriate to create, preserve,
protect and perfect the security interest granted by the Grantor to the Agent
hereby in respect of the Collateral have been accomplished and the security
interest granted to the Agent pursuant to this Agreement in and to the
Collateral constitutes a perfected security interest therein prior to the
rights of all other Persons therein and subject to no other Liens (other than
other Permitted Liens) and is entitled to all the rights, priorities and
benefits afforded by the UCC or other relevant law as enacted in any relevant
jurisdiction to perfected security interests.
3.2 PRINCIPAL LOCATION. The Grantor's mailing address, and
the location of its chief executive office andeach location of any books and
records (including all computer data and related software including source
codes) relating to Receivables or General Intangibles is disclosed in ANNEX I
hereto (as the same may be modified pursuant to Section 4.4); and the Grantor
has no other places of business except those set forth in ANNEX I hereto (as
the same may be modified pursuant to Section 4.4).
3.3 PROPERTY LOCATIONS. The Inventory, Equipment and Fixtures
are located solely at the locations described in ANNEX I hereto (as the same
may be modified pursuant to Section 4.4). None of said locations are leased
by the Grantor as lessee except those designated in Part C of ANNEX I hereto
(as the same may be modified pursuant to Section 4.4).
3.4 NO OTHER NAMES. Except as listed on ANNEX II hereto, the
Grantor does not conduct and has not conducted any trade or business under
any name except the name in which it has executed this Agreement. The
Grantor has not been a party to any merger or consolidation in the last five
years.
3.5 FILING REQUIREMENTS. None of the Equipment is covered by
any certificate of title. None of the Collateral consists of property
subject to a statute or treaty referred to in Section 9-302(3) of the UCC
(other than Intellectual Property Collateral). None of the Collateral is of a
type with respect to which Liens may be filed under any federal statute
except for patents and patent applications, registered copyrights, registered
trademarks and
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trademark applications held by the Grantor and described in ANNEX III hereto
(as the same may be modified pursuant to Section 4.14).
3.6 NO FINANCING STATEMENTS. No financing statement
describing all or any portion of the Collateral which has not lapsed or been
terminated has been filed in any jurisdiction except financing statements
naming the Agent as secured party for the benefit or on behalf of the Lenders
and financing statements filed in respect of Permitted Liens.
3.7 TITLE TO PROPERTIES. The Grantor has good and
merchantable title to and ownership of the Collateral held by it, free and
clear of all Liens except Permitted Liens.
3.8 INSURANCE. The Grantor has insured the Collateral against
loss or damage by fire, theft, burglary, pilferage, and loss in transit, and
has insured against loss as required pursuant to the Loan Agreement.
3.9 INTELLECTUAL PROPERTY. ANNEX III (as the same may be
modified pursuant to Section 4.14) hereto contains a complete and accurate
list as of the date hereof of all patented and registered Intellectual
Property Collateral owned by the Grantor and all pending U.S. patent
applications and U.S. applications for the registration of other Intellectual
Property Collateral and all foreign trademark registrations owned or filed by
the Grantor. ANNEX III (as the same may be modified pursuant to Section 4.14)
also contains a complete and accurate list of all licenses and other rights
granted by the Grantor to any third party with respect to the Intellectual
Property Collateral and licenses and other rights granted by any third party
to the Grantor. Except as set forth in ANNEX III, (as the same may be
modified pursuant to Section 4.13) (a) the Grantor owns and possesses all
right, title and interest in and to, or has a valid and enforceable license
to use, all of the Intellectual Property Collateral necessary for the
operation of its business as presently conducted or as currently proposed to
be conducted; (b) no claim by any third party contesting the validity,
enforceability, use or ownership of any Intellectual Property Collateral has
been made, is currently outstanding or to Grantor's knowledge, is threatened,
and to the Grantor's knowledge, there are no grounds for any such claim; (c)
the Grantor has not received any notices of, and is not aware of any facts
which indicate a likelihood of, any infringement or misappropriation by, or
conflict with, any third party with respect to the Intellectual Property
Collateral, nor has the Grantor received any claims of infringement or
misappropriation of or other conflict with any intellectual property rights
of any third party which remains outstanding; (d) the Grantor has not
infringed, misappropriated or otherwise conflicted with any intellectual
property rights of any third parties, nor is the Grantor aware of any
material infringement, misappropriation or conflict which will occur as a
result of the continued operation of its business as conducted or as
currently proposed to be conducted; (e) the Grantor has made all necessary
filings and recordations and has paid all required fees and taxes to record
and maintain its ownership of the patented and registered intellectual
property rights set forth on Annex III in the United States Patent and
Trademark Office and the United States Copyright Office; and (f) no consents
are required under any licenses listed in ANNEX III to the grant of the
security interest to, and exercise of any rights and remedies of, the Agent.
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3.10 ACCOUNTS. The bank accounts with the Lenders described
on ANNEX IV (as the same may be modified by written notice to the Agent) are
the only bank or deposit accounts which the Grantor maintains.
3.11 CONTRACTS. No consent of any party to any Contract is
required in connection with the execution, delivery and performance of this
Agreement. Without limiting the foregoing, no Contract is an Excluded
Contract, and no Intellectual Property Collateral is Excluded Intellectual
Property Collateral.
4. COVENANTS.
From the date of this Agreement, and thereafter until this Agreement
is terminated:
4.1 INSPECTION AND VERIFICATION. The Agent and such Persons
as the Agent may designate will have the right, at any reasonable time or
times upon prior notice and during the Grantor's usual business hours, 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 Grantor's affairs with the officers of the Grantor
and their independent auditors, and to verify under reasonable procedures the
validity, amount, quality, quantity, value and condition of, or any other
matter relating to, the Collateral. In addition, in the case of Accounts or
Collateral in the possession of a third party, the Agent will have the right
to contact account debtors (after the occurrence and during the continuance
of an Event of Default) or third parties possessing such Collateral in order
to verify the validity, amount, quality, quantity, value and condition of
such Collateral; provided, however, that prior to the occurrence of an Event
of Default the Agent may contact account debtors only upon prior notice to
the Grantor and, to the extent practicable, with the participation of the
Grantor's officers. The Agent will have the absolute right without liability
on the part of the Agent to share any information it gains from such
inspection or verification with any or all of the Lenders.
4.2 RECORDS AND REPORTS. The Grantor will maintain complete
and accurate books and records with respect to the Collateral, and furnish to
the Agent such reports relating to the Collateral as the Agent may from time
to time reasonably request.
4.3 FINANCING STATEMENTS AND OTHER ACTIONS. The Grantor will
execute and deliver to the Agent all financing statements and amendments
thereto and other documents, and take such other actions, as are from time to
time reasonably requested by the Agent in order to perfect and to maintain
and protect a first priority (subject only to other Permitted Liens)
perfected security interest in the Collateral or to enable the Agent, on
behalf of the Lenders, to exercise and enforce its rights and remedies
hereunder with respect to the Collateral.
4.4 CHANGE IN LOCATION OR NAME. The Grantor will not (a) have
any Inventory or Equipment or products thereof at a location other than a
location specified in ANNEX I hereto, except for Inventory in transit between
such locations, (b) maintain records relating to the Receivables at a
location other than those locations specified on ANNEX I hereto as
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a location where such records are kept, (c) maintain a place of business at a
location other than a location specified on ANNEX I hereto, (d) change its
name, or (e) change its mailing address, unless, in each case, the Grantor
has given the Agent at least 30 days' prior written notice thereof and
delivered to Agent a revised Annex I, and delivered any financing statements
or other documents requested by the Agent, including opinions of counsel, and
the Agent will have advised such Grantor in writing of the Agent's
determination that, after giving effect to such change of name, address or
location and any filings to be made in connection therewith, the Agent will
have a continuing perfected security interest in the Collateral, the priority
of which will not be adversely affected by such change.
4.5 OTHER FINANCING STATEMENTS. The Grantor will not sign or
authorize the signing on its behalf of any financing statement naming it as
debtor which covers all or any portion of the Collateral, except financing
statements naming the Agent as secured party and those signed in respect of
other Permitted Liens.
4.6 RECEIVABLES.
(a) Except as otherwise provided in this Agreement, the
Grantor will collect and enforce in accordance with the Grantor's past
collection practices and procedures, at the Grantor's sole expense, all
amounts due or hereafter due to the Grantor under the Receivables.
(b) After the occurrence and during the continuance of any
Event of Default, the Grantor will not, without the Agent's prior written
consent, grant any extension of the time of payment of any of the
Receivables, 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.
(c) The names of the obligors, amounts owing, due dates
and other information with respect to the Receivables are and will be
correctly stated in all material respects in all records of the Grantor
relating thereto and in all invoices and reports with respect thereto
furnished to the Agent by the Grantor from time to time.
4.7 MAINTENANCE OF INVENTORY AND EQUIPMENT. The Grantor will
do all things necessary to maintain, preserve, protect and keep the Inventory
in good repair and saleable condition and the Equipment in good repair and
working condition.
4.8 INSURANCE. Effective upon the occurrence and during the
continuance of an Event of Default, the Grantor hereby irrevocably makes,
constitutes, and appoints the Agent (and all officers, employees, or agents
designated by the Agent) as the Grantor's true and lawful attorney (and
agent-in-fact) for the purpose of making, settling, and adjusting claims
under policies of insurance, endorsing the name of the 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 (but in no event will the Agent have the power to terminate or cancel
any such insurance). In the event that the Grantor at any time or times
fails to obtain or maintain any of the policies of insurance required by any
Loan Document
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or to pay any premium in whole or part relating thereto, the Agent may,
without waiving or releasing any obligation or liability of the Grantor
hereunder or any Potential Event of Default or Event of Default, in its sole
discretion, obtain and maintain such policies of insurance and pay such
premium and take any other action with respect thereto as the Agent deems
advisable. All such sums so disbursed by the Agent, including reasonable
attorney's fees, court costs, expenses and other charges relating thereto,
will be payable, upon demand, by the Grantor to the Agent and will be
additional Obligations secured hereby.
4.9 TITLED VEHICLES. The Grantor will promptly give the Agent
notice of its acquisition of any Vehicle and, upon request of the Agent, the
Grantor will promptly execute and deliver any instruments and documents that
may be necessary or that the Agent may request in order to perfect the
Agent's security interest (for the benefit of the Lenders) in all property
subject to a certificate of title.
4.10 BAILEES. If any Inventory or Equipment is in the
possession or control of any warehouseman, processor or other bailee, the
Grantor will notify such warehouseman, processor and other bailee in writing
(with a copy to the Agent) of the Agent's security interest therein and, upon
the Agent's request, instruct such Person to hold all such Inventory and
Equipment for the Agent's account and subject to the Agent's instructions.
If more than $25,000 of Inventory or Equipment is held by a bailee, the
Grantor will file a financing statement in the appropriate jurisdiction
against such bailee in a form appropriate for the underlying transaction.
4.11 FAIR LABOR STANDARDS ACT. None of the Inventory of the
Grantor has been or will be produced in violation of any provision of the
Fair Labor Standards Act of 1938, 29 U.S.C. Section 201 ET SEQ., or in
violation of any other law.
4.12 DELIVERY OF PLEDGED COLLATERAL. The Grantor will hold in
trust for the Agent upon receipt and promptly thereafter deliver to the Agent
the originals of all Instruments, Chattel Paper, letters of credit and
certificates issued in respect of Pledged Deposits, which will be endorsed in
blank, marked with such legends and accompanied by such undated stock powers
and assignments, executed in blank, as the Agent may specify. Upon request
by the Grantor in the absence of a Potential Event of Default or Event of
Default, the Agent will deliver to the Grantor any certificate of title
required to enable the Grantor to dispose of Vehicles in accordance with the
Loan Documents, and any Instruments and Chattel Paper required for purposes
of collection of Accounts, so long as the Grantor takes such actions as the
Agent may request to maintain the Agent's perfected security interest therein
and in the proceeds thereof. Upon the Agent's request, the Grantor will
promptly deliver to the Agent the originals of all Documents.
4.13 UNCERTIFICATED SECURITIES. If, notwithstanding the
provisions of the Pledge Agreement, the Grantor acquires any uncertificated
security, the Grantor (a) will cause the issuers of such uncertificated
securities or other appropriate parties under Sections 8-313 and 8-321 of the
UCC to xxxx their books and records with the numbers and face amounts of such
uncertificated securities and all rollovers and replacements therefor to
reflect the
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Lien of the Agent granted pursuant to this Agreement, (b) will obtain from
such issuers and other Persons, for the benefit of the Agent and the Lenders,
written confirmation of the Lien granted to the Agent hereunder in such
uncertificated securities, and (c) will take and will cause such parties to
take all other action necessary or appropriate to create and maintain a
perfected first priority Lien in such uncertificated securities in favor of
the Agent.
4.14 INTELLECTUAL PROPERTY COVENANTS. The Grantor will:
(a) consistent with commercially reasonable practices,
continue to use each of its trademarks on each and every trademark class of
goods as reflected in its current catalogs, brochures and price lists in
order to maintain each trademark in full force free from any claim of
abandonment for non-use;
(b) maintain the quality of products and services offered
under each of its trademarks;
(c) use all commercially reasonable efforts to employ each
of its trademarks or copyrights with the appropriate notice of its
registration on applicable products or services;
(d) use all commercially reasonable efforts to employ each
of its patents with the appropriate notice of existence on applicable
products or processes;
(e) consistent with commercially reasonable practices (and
in accordance with the reasonable business judgment of the Grantor's Board of
Directors as to whether any of the Intellectual Property Collateral is needed
for the present and anticipated conduct of the Grantor's business, if no
Event of Default has then occurred and is continuing), not perform or omit to
perform any act whereby any patent rights may become dedicated, invalidated
or unenforceable, any trademark rights may become abandoned or unenforceable,
any copyright rights may become abandoned or unenforceable, any other
Intellectual Property Collateral may become unenforceable or placed in the
public domain, or any license rights may lapse or be terminated;
(f) consistent with commercially reasonable practices,
prosecute diligently any patent, trademark or copyright application which is
pending as of the date of this Agreement or hereafter;
(g) make application on unpatented but patentable
inventions and unregistered but registrable trademarks, as appropriate
(unless the Grantor and the Agent determine that such application is of
insufficient economic value to the Grantor to justify such action);
(h) consistent with commercially reasonable practices (and
in accordance with the reasonable business judgment of the Grantor's Board of
Directors as to whether any of the Intellectual Property Collateral is needed
for the present and anticipated
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conduct of the Grantor's business, if no Event of Default has then occurred
and is continuing), maintain all rights in and to the Intellectual Property
Collateral;
(i) make all necessary filings and recordings and pay all
required fees and taxes to record and maintain its registration and ownership
of each item of Intellectual Property Collateral owned by it;
(j) promptly notify the Agent if it knows, or has reason
to know, that any application or registration relating to the Intellectual
Property Collateral may become abandoned or dedicated to the public, or of
any adverse determination or development (including any claim) regarding the
Grantor's ownership of any Intellectual Property Collateral, or its right
to register the same or to keep and maintain the same;
(k) in the event that any item of the Intellectual
Property Collateral is infringed or misappropriated by a third party,
promptly notify the Agent after it learns thereof and will, unless the
Grantor and the Agent determine that such item of Intellectual Property
Collateral is of insufficient economic value to the Grantor to justify such
action, promptly xxx for infringement or misappropriation or take other
commercially reasonable action (as determined by the Grantor) to cause such
infringement to cease;
(l) within 10 days after acquiring any U.S. Intellectual
Property Collateral which, if owned on the date hereof would have been
disclosed on Annex III hereto, provide to the Agent an Annex III which has
been revised to reflect such additional Intellectual Property Collateral; and
(m) not grant any license the terms of which limit or do
not permit the grant of rights to the Agent in Section 4.15 or the taking by
the Agent of the action described in Section 8.4(j) (without regard to any
limitation on such grant of rights or taking of action by virtue of the terms
of any preexisting licenses), without the prior written consent of the Agent.
4.15 GRANT OF LICENSE TO USE GENERAL INTANGIBLES. For the
purpose of enabling the Agent to exercise rights and remedies thereunder
during the continuation of an Event of Default, the Grantor hereby grants to
the Agent an irrevocable, nonexclusive license (exercisable without payment
of royalty or other compensation to the Grantor) to use, license or
sublicense any of the General Intangibles to the extent not inconsistent with
the terms of any preexisting licenses issued by or to Grantor, wherever the
same may be located, including in such license reasonable access to all media
in which any of the General Intangibles may be recorded or stored and to all
computer programs used for the compilation or printout thereof; PROVIDED that
the Agent will comply with all quality control standards and trademark use
requirements of the Grantor. Except as set forth in the preceding sentence,
the Agent will have no obligations or liabilities regarding any or all or the
General Intangibles by reason of, or arising out of, this Agreement.
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4.16 FEDERAL CLAIMS.
(a) CLAIMS. The Grantor will notify the Agent of any
Collateral which constitutes a claim against the United States government or
any instrumentality or agency thereof, the assignment of which claim is
restricted by federal law.
(b) ACTION. Upon the request of the Agent, the Grantor
will take all reasonable actions required to comply, to the Agent's
satisfaction, with the Assignment of Claims Act of 1940, as amended, or any
similar applicable law, with respect to any such Collateral.
5. REMEDIES UPON DEFAULT.
5.1 REMEDIES UPON DEFAULT. If any Event of Default occurs and
is continuing, whether or not any or all of the Obligations have become due
and payable, the Agent may, in addition to its rights under the Loan
Agreement or any other Loan Document:
(a) Exercise any or all of the rights and remedies
provided (i) in this Agreement, (ii) to a secured party when a debtor is in
default under a security agreement governed by the UCC or (iii) to a secured
party when a debtor is in default by any other applicable law including any
law governing the exercise of a lender's right of setoff or lender's lien.
Without precluding any other methods of sale, the sale of Collateral will be
deemed to have been made in a commercially reasonable manner if conducted in
conformity with reasonable commercial practices of commercial lenders
disposing of similar property, but in any event the Agent may sell Collateral
on such terms as the Agent may choose without assuming any credit risk and
without any obligation to advertise or give notice of any kind not expressly
required under this Agreement.
(b) With respect to Obligations which are contingent and
cannot be accelerated by their nature, require the Grantor to deposit cash
collateral in an amount equal to the maximum exposure of the Agent with
respect thereto (as determined in good faith by the Agent).
(c) Sell, resell, assign, transfer and deliver all or any
part of the Instruments or uncertificated securities owned or held by the
Grantor and pledged to the Agent hereunder. Upon any such sale, the Agent,
unless prohibited by a provision of any applicable statute, may purchase all
or any part of the Instruments or uncertificated securities being sold, free
from all trusts, claims, rights of redemption and equities of the Grantor.
If, at any time when the Agent determines to exercise its rights to sell all
or any part of the Instruments or uncertificated securities pursuant to this
Section5.1(c), such Collateral or the sale thereof is not effectively
registered or exempt from registration under the Securities Act of 1933, the
Agent, in its sole and absolute discretion, is hereby expressly authorized to
sell such Instruments or uncertificated securities, or any part thereof, by
private sale in such manner and under such circumstances as the Agent may
deem necessary or advisable in order that such sale may be legally effected
without such registration. Without limiting the generality of the foregoing,
the Agent, in its sole and absolute discretion, may approach and negotiate
with a restricted number
11
of potential purchasers to effect such sale or restrict such sale to a
purchaser or purchasers who will represent and agree that it or they are
purchasing for its or their own account, for investment only, and not with a
view to the distribution of such Instruments or uncertificated securities or
any part thereof. Any such sale will be deemed to be a sale made in a
commercially reasonable manner within the meaning of the Code and the Grantor
hereby consents and agrees that the Agent will not incur any responsibility
or liability for the Agent's selling all or any part of the Instruments or
uncertificated securities under such procedures, notwithstanding the
possibility that a substantially higher price might be realized if
registration was accomplished and a public sale thereof was effected.
(d) Immediately enter upon any premises leased by the
Grantor for the storage, warehousing or maintenance of Inventory and remove,
take possession and dispose of, or store at another site, such Inventory in
the Agent's sole discretion.
(e) Without any necessity on the Agent's part to resort to
other security or sources of reimbursement for the Obligations, at any time
during the continuance of an Event of Default and with notice to the Grantor
given contemporaneously or within a reasonable time thereafter, exercise
rights of set-off against any of the Pledged Deposits (general or special,
time or demand, provisional or final) or other sums of the Grantor in the
possession of or in transit to the Agent for application to the Obligations,
which rights will be cumulative with the Agent's other rights and remedies
including other rights of set-off.
5.2 CASH PROCEEDS. It is agreed that if an Event of Default
will occur and be continuing, all proceeds and any cash in a Deposit Account
received by the Grantor consisting of cash, checks and other near-cash items,
including any payments of Accounts, when collected by the Grantor, will be
forthwith (and, in any event, within two Business Days) deposited by the
Grantor in the exact form received, duly endorsed by the Grantor to the Agent
if required, in a special collateral account maintained by the Agent, subject
to withdrawal by the Grantor for the account of the Lenders only, and, until
so turned over, will be held by the Grantor in trust for the Agent,
segregated from other funds of the Grantor. All proceeds while held by the
Agent (or by the Grantor-in-trust for the Agent) will continue to be
collateral security for all of the Obligations and will not constitute
payment thereof until applied. If an Event of Default occurs and is
continuing, the Agent may at any time and from time to time apply all or any
part of the funds on deposit in said special collateral account on account of
the Obligations in such order as provided in Section 7.2. Upon cure or
written waiver of all then-existing Events of Default and Defaults, the
Grantor's obligation to direct funds to such special collateral account will
cease (unless and until the Agent once again exercises its rights pursuant to
this Section 5.2) and all funds in such special collateral account will be
released to the Grantor.
5.3 SPECIFIC PERFORMANCE. The Grantor agrees that, in
addition to all other rights and remedies granted to the Agent in this
Agreement and any other Loan Documents, the Agent will be entitled to
specific performance and injunctive and other equitable relief, and the
Grantor further agrees to waive any requirement for the securing or posting
of any bond or other security in connection with the obtaining of any such
specific performance and injunctive or other equitable relief.
12
5.4 GRANTOR'S SECURED LIABILITIES UPON EVENT OF DEFAULT. Upon
the request of the Agent after the occurrence and during the continuance of
an Event of Default, the Grantor will promptly:
(a) Assemble and make available to the Agent the
Collateral and all records relating thereto at any place or places specified
by the Agent within the State of California.
(b) Permit the Agent, or the Agent's representatives and
agents, to enter any premises where all or any part of the Collateral, or the
books and records relating thereto, or both, are located, to take possession
of all or any part of the Collateral and to remove all or any part of the
Collateral.
5.5 REMEDIES CUMULATIVE. All rights, powers and remedies
contained in this Agreement or afforded by law will be cumulative and all
will be available to the Agent until the Obligations have been paid in full.
6. WAIVERS, AMENDMENTS AND REMEDIES.
No delay or omission of the Agent to exercise any right, power or
remedy granted under this Agreement will impair such right, power or remedy
or be construed to be a waiver of any Event of Default or an acquiescence
therein, and any single or partial exercise of any such right, power or
remedy will not preclude other or further exercise thereof or the exercise of
any other right, power or remedy, and no waiver, amendment or other variation
of the terms, conditions or provisions of this Agreement whatsoever will be
valid unless signed by each of the parties hereto and Requisite Noteholders,
and then only to the extent specifically set forth in such writing.
7. PROCEEDS; COLLECTION OF RECEIVABLES.
7.1 COLLECTION OF RECEIVABLES. The Agent may at any time
after the occurrence and during the continuance of an Event of Default, by
giving the Grantor written notice, elect to enforce collection of any
Receivable and to require that the Receivables be paid directly to the Agent.
In such event, the Grantor will, and will permit the Agent to, promptly
notify the account debtors or obligors under the Receivables of the Agent's
interest therein and direct such account debtors or obligors to make payment
of all amounts then or thereafter due under the Receivables directly to the
Agent. Upon receipt of any such notice from the Agent, the Grantor will
thereafter hold in trust for the Agent all amounts and proceeds received by
it with respect to the Receivables and other Collateral, will segregate all
such amounts and proceeds from other funds of the Grantor, and will at all
times thereafter promptly deliver to the Agent all such amounts and proceeds
in the same form as so received, whether by cash, check, draft or otherwise,
with any necessary endorsements.
7.2 APPLICATION OF PROCEEDS. (a) During the continuance of an
Event of Default, the Agent will have the continuing and exclusive right to
apply or reverse and re-apply any and all payments to any portion of the
Obligations. To the extent that the Grantor
13
makes a payment or payments to the Agent or the Agent receives any payment or
proceeds of the Collateral, which payment or proceeds or any part thereof are
subsequently invalidated, declared to be fraudulent or preferential, set
aside or required to be repaid to a trustee, receiver or any other party
under any bankruptcy law, state or federal law, common law or equitable
cause, then, to the extent of such payment or proceeds, the Obligations or
part thereof intended to be satisfied and this Agreement will be revived and
continue in full force and effect, as if such payment or proceeds had not
been received by such party.
(b) The Agent will apply the proceeds of any collection or
sale of the Collateral as follows:
FIRST, to the payment of all costs and expenses incurred by the Agent
in connection with such collection or sale or otherwise in connection
with this Agreement or any of the Obligations, including all court
costs and the reasonable fees and expenses of its agents and legal
counsel, the repayment of all advances made by the Agent hereunder on
behalf of the Grantor and any other costs or expenses incurred in
connection with the exercise of any right or remedy hereunder.
SECOND, to the payment in full of all unpaid accrued interest on the
Notes, pro rata among the Lenders in accordance with the amount of
unpaid accrued interest on the Notes held by them;
THIRD, to the payment in full of the unpaid principal amount of the
Notes, pro rata among the Lenders in accordance with the unpaid
principal amount of the Notes held by them.
FOURTH, to the payment and discharge in full of the Obligations (other
than those referred to above), pro rata among the Persons to whom such
Obligations are owed in accordance with the aggregate amount of such
Obligations owing to such Persons.
FIFTH, to the Grantor, its successors or assigns, or as a court of
competent jurisdiction may otherwise direct.
The Agent will have absolute discretion as to the time of application of any
such proceeds, moneys or balances in accordance with this Agreement. Upon
any sale of the Collateral by the Agent (including pursuant to a power of
sale granted by statute or under a judicial proceeding), the receipt of the
Agent or of the officer making the sale will be a sufficient discharge to the
purchaser or purchasers of the Collateral so sold and such purchaser or
purchasers will not be obligated to see to the application of any part of the
purchase money paid over to the Agent or such officer or be answerable in any
way for the misapplication thereof.
14
8. GENERAL PROVISIONS.
8.1 NOTICE OF DISPOSITION OF COLLATERAL. To the extent
required by law, Grantor will be given reasonable advance notice of the time
and place of any public sale or the time after which any private sale or
other disposition of all or any part of the Collateral may be made, and
Grantor and the Agent agree that any such notice made will be deemed
reasonable if given to the Grantor at least 10 days prior to the time of any
such public sale or the time after which any such private sale or other
disposition may be made.
8.2 COMPROMISES AND COLLECTION OF COLLATERAL. The Grantor
recognizes that setoffs, counterclaims, defenses and other claims may be
asserted by obligors with respect to certain of the Receivables, that certain
of the Receivables may be or become uncollectible in whole or in part and
that the expense and probability of success in litigating a disputed
Receivable may exceed the amount that reasonably may be expected to be
recovered with respect to a Receivable. In view of the foregoing, the
Grantor agrees that the Agent may at any time and from time to time during
the continuance of an Event of Default compromise with the obligor on any
Receivable, accept in full payment of any Receivable such amount as the Agent
in its sole discretion determines or abandons any Receivable, and any such
action by the Agent will be deemed commercially reasonable so long as the
Agent acts in good faith based on information known to it at the time it
takes any such action.
8.3 SECURED PARTY PERFORMANCE OF GRANTOR SECURED LIABILITIES.
Without having any obligation to do so, the Agent may, upon notice to the
Grantor, perform or pay any obligation which the Grantor has agreed to
perform or pay in this Agreement but has not performed or paid and the
Grantor will reimburse the Agent for any amounts paid or incurred pursuant to
this Section 8.3. The Grantor's obligation to reimburse the Agent pursuant to
the preceding sentence will be an Obligation payable on demand.
8.4 AUTHORIZATION FOR SECURED PARTY TO TAKE CERTAIN ACTION.
The Grantor irrevocably authorizes the Agent at any time and from time to
time in the sole discretion of the Agent, and appoints the Agent as its
attorney-in-fact to act on behalf of the Grantor, in the name of the Grantor
or otherwise, from time to time in the Agent's discretion, to take any action
and to execute any instrument which the Agent may deem necessary or advisable
to accomplish the purposes of this Agreement, including (a) to execute on
behalf of the Grantor as debtor and to file financing statements necessary or
desirable in the Agent's sole discretion to perfect and to maintain the
perfection and priority of the Agent's security interest in the Collateral;
(b) during the continuance of an Event of Default, to endorse, deposit and
collect any cash, Instruments and other proceeds of the Collateral; (c) to
file a carbon, photographic or other reproduction of this Agreement or any
financing statement with respect to the Collateral as a financing statement
in such offices as the Agent in its sole discretion deems necessary or
desirable to perfect and to maintain the perfection and priority of the
Agent's security interest in the Collateral; (d) during the continuance of an
Event of Default, to enforce payment of the Receivables in the name of the
Agent or the Grantor; (e) to cause the proceeds of any Collateral received by
the Agent during the continuance of an Event of Default to be applied to the
Obligations; (f) during the continuance of an Event of Default, to sign the
Grantor's name on any invoice or xxxx of lading
15
relating to any Receivable, on drafts against customers, on schedules and
assignments of Receivables, on notices of assignment, financing statements
and other public records, on verifications of accounts and on notices to
customers; (g) during the continuance of an Event of Default, to notify the
post office authorities to change the address for delivery of the Grantor's
mail to an address designated by the Agent, and to receive, open and dispose
of all mail addressed to the Grantor (and the Agent will promptly forward to
the Grantor all mail that does not pertain to or constitute Collateral); (h)
during the continuance of an Event of Default, to send requests for
verification of Receivables to customers or account debtors (provided that
this clause (h) will not limit the Agent's rights under Section 4.01); (i) to
do all things necessary to carry out this Agreement; (j) during the
continuance of an Event of Default, to grant or issue any exclusive or
nonexclusive license under the Collateral to any Person, to the extent
consistent with the terms of any pre-existing licenses granted by the Grantor
and to apply the license revenues to the Obligations; and (k) during the
continuance of an Event of Default, to assign, pledge, convey or otherwise
transfer title in or to or dispose of the Collateral to anyone, including to
make assignments, recordings, registrations and applications therefor in the
United States Patent and Trademark Office, the United States Copyright Office
or any similar office or agency of the United States, any state thereof or
any other country or political subdivision thereof, and to execute and
deliver any and all agreements, documents, instruments of assignment or other
papers necessary or advisable to effect any of the foregoing or the
recordation, registration, filing or perfection thereof. The Grantor
ratifies and approves all acts of such attorney-in-fact. The Agent will not
be liable for any acts or omissions except those determined pursuant to a
final, non-appealable order of a court of competent jurisdiction to have
resulted solely from the Agent's gross negligence or willful misconduct. The
power conferred on the Agent hereunder is solely to protect its interests in
the Collateral and will not impose any duty upon the Agent to exercise such
power. This power, being coupled with an interest, is irrevocable.
8.5 USE AND POSSESSION OF CERTAIN PREMISES. Upon the
occurrence and during the continuance of an Event of Default, the Agent or
its agents or representatives will be entitled to occupy and use any premises
owned or leased by the Grantor where any of the Collateral or any records
relating to the Collateral are located until the Obligations are paid in full
or until the Collateral is removed therefrom, whichever occurs first, without
any obligation to pay the Grantor for such use and occupancy.
8.6 GRANTOR REMAINS LIABLE.
(a) CONTRACTS AND AGREEMENTS. Anything contained in this
Agreement to the contrary notwithstanding, (i) the Grantor will remain solely
liable to perform its duties and obligations under the contracts and
agreements included in the Collateral to the extent set forth therein to the
same extent as if this Agreement had not been executed, (ii) the exercise by
the Agent of any of its rights and remedies hereunder will not release the
Grantor from any of its duties or obligations under the contracts and
agreements included in the Collateral except to the extent the exercise of
such rights renders the performance of such duties or obligations by the
Grantor impracticable under any such agreement or contract, and (iii) the
Agent and the Lenders will not have any obligation or liability under any
contract or agreement included in the Collateral by reason of this Agreement,
and the Agent and the Lenders will not
16
be obligated in any manner to perform any of the obligations or duties of the
Grantor thereunder or to take any action to collect or enforce any claim for
payment assigned hereunder.
(b) ACCOUNTS AND LICENSES. Anything contained in this
Agreement to the contrary notwithstanding, the Grantor will remain solely
liable under each of the Accounts and all licenses, permits and
authorizations granted to the Grantor by any governmental entity
(collectively, the "LICENSES") and to observe and perform all the conditions
and obligations to be observed and performed by it thereunder, all in
accordance with the terms of any agreement giving rise to any such Account or
License. Neither the Agent nor any Lender will have any obligation or
liability under any Account (or any agreement giving rise thereto) or License
by reason of or arising out of this Agreement or the receipt by the Agent or
any Lender of any payment relating to such Account or License pursuant
hereto, nor will the Agent or any Lender be obligated in any manner to
perform any of the obligations of the Grantor under or pursuant to any
Account (or any agreement giving rise thereto) or License, to make any
payment, to make any inquiry as to the nature or the sufficiency of any
payment received by it or as to the sufficiency of any performance by any
party under any Account (or any agreement giving rise thereto) or License, to
present or file any claim, to take any action to enforce any performance or
to collect the payment of any amount which may have been assigned to it or to
which it may be entitled at any time or times.
8.7 LIMITATION ON DUTY OF AGENT REGARDING THE COLLATERAL.
Beyond the exercise of reasonable care in the custody of any Collateral in
its possession, the Agent will have no duty as to any Collateral in its
possession or control or in the possession or control of any agent or bailee,
or any income thereon, or as to the preservation of rights against prior
parties or any other rights pertaining thereto. The Agent will be deemed to
have exercised reasonable care in the custody of the Collateral in the
Agent's possession if the Collateral is accorded treatment substantially
equal to that which the Agent accords its own property. The Agent will not
be liable or responsible for any loss or damage to any of the Collateral, or
for any diminution in the value thereof, by reason of the act or omission of
any warehouseman, carrier, forwarding agency, consignee or other agent or
bailee selected by the Agent in good faith.
8.8 LIMITATION ON DUTIES REGARDING PRESERVATION OF COLLATERAL.
The Agent's sole duty with respect to the custody, safekeeping and physical
preservation of the Collateral in its possession, under Section 9-207 of the
UCC or otherwise, will be to deal with it in the same manner as the Agent
would deal with similar property for its own account. Neither the Agent nor
any Lender, nor any of their respective directors, officers, employees or
agents will be liable for failure to demand, collect or realize upon all or
any part of the Collateral or for any delay in doing so or will be under any
obligation to sell or otherwise dispose of any Collateral upon the request of
the Grantor or otherwise.
9. MISCELLANEOUS.
9.1 SECURITY INTEREST ABSOLUTE. All rights of the Agent
hereunder, the security interest granted hereby, and all obligations of the
Grantor hereunder, will be absolute and unconditional irrespective of (a) any
lack of validity or enforceability of the Loan
17
Agreement, any other Loan Document, any agreement with respect to any of the
Obligations or any other agreement or instrument relating to any of the
foregoing, (b) any change in the time, manner or place of payment of, or in
any other term of, all or any of the Obligations, or any other amendment or
waiver of or any consent to any departure from any Loan Document or any other
agreement or instrument, (c) any exchange, release or non-perfection of any
other Collateral, or any release, amendment or waiver of, or consent to or
departure from, any guaranty for all or any of the Obligations, or (d) any
other circumstance which might otherwise constitute a defense available to,
or a discharge of, the Grantor in respect of the Obligations or in respect of
this Agreement.
9.2 FEES AND EXPENSES. The Grantor agrees to pay upon demand
to the Agent (for the account of the Lenders, if appropriate) the amount of
any and all expenses, including the fees and expenses of its counsel and of
any experts or agents, which the Agent or any Lender may incur or pay in
connection with the administration of this Agreement, the custody or
preservation of, or the sale of, collection from, or other realization upon,
any of the Collateral, the exercise or enforcement of any of the rights of
the Agent hereunder, or the failure by the Grantor to perform or observe any
of the provisions hereof, or otherwise. Any such amounts payable as provided
hereunder or thereunder will be additional Obligations secured by this
Agreement and the other Loan Documents.
9.3 BINDING AGREEMENT; ASSIGNMENTS. This Agreement, and the
terms, covenants and conditions hereof, will be binding upon and inure to the
benefit of the parties hereto and their respective successors and permitted
assigns, except that the Grantor will not be permitted to assign this
Agreement or any interest herein or in the Collateral or any part thereof, or
otherwise pledge, encumber or grant any option with respect to the Collateral
or any part thereof, or any cash or property held by the Agent as Collateral
under this Agreement, except for Permitted Liens or with the prior written
consent of the Agent and Requisite Lenders.
9.4 HOLIDAYS. Whenever any payment or action to be made or
taken under this Agreement is stated to be due or required to be taken on a
day which is not a Business Day, such payment or action will be made or taken
on the next following Business Day, and such extension of time will be
included in computing interest or fees, if any, in connection with such
payment or action.
9.5 NOTICES. All notices and other communications given to or
made upon any party hereto in connection with this Agreement will, except as
otherwise expressly provided herein, be in writing and mailed, telecopied or
delivered by hand or by reputable overnight courier service to the respective
parties, as follows:
Grantor: c/o International Wireless Communications, Inc.
000 X. Xx Xxxxxx Xxxx
Xxxxx 0000
Xxx Xxxxx, XX 00000
Attention: Xxxx X. Xxxxxxx
Telecopy: (000) 000-0000
18
WITH A COPY (WHICH WILL NOT CONSTITUTE NOTICE) TO:
Xxxxxx Xxxxxx, Esq.
Xxxxxxxxx Xxxxxxx Xxxxxx Xxxxxxxxxx
Xxxxxxxx & Xxxxxxxxx, LLP
000 Xxxxxxxxxxxx Xxxxx
Xxxxx Xxxx, XX 00000
Telecopy: (000) 000-0000
Agent: Toronto Dominion Investments, Inc.
000 Xxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Xxxxxx Xxxxxxx
Telecopy: (000) 000-0000
WITH COPIES (WHICH WILL NOT CONSTITUTE NOTICE) TO:
Toronto Dominion Investments, Inc.
00 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx X. Xxxx
Telecopy: (000) 000-0000
and
Xxxx Xxxxx
Xxxxxxxx & Xxxxx
000 X. 00xx Xxxxxx
Xxx Xxxx, XX 00000
Telecopy: (000) 000-0000
or in accordance with any subsequent written direction from the recipient
party to the sending party made in accordance with this Section 9.5. All
such notices and other communications will, except as otherwise expressly
provided in this Agreement, be effective upon (a) delivery if delivered by
hand; (b) on the Business Day after deposited with a reputable overnight
courier service, delivery charges prepaid; (c) on the third Business Day
after deposited in the mail, postage prepaid; or (d) in the case of telecopy,
when received.
9.6 SURVIVAL. All representations, warranties, covenants and
agreements of the Grantor contained in this Agreement or made in writing in
connection herewith will survive the execution and delivery of this
Agreement, the making of the Loans hereunder and the issuance of the Notes.
The provisions of this Section 9 will survive repayment of the Loans and the
other amounts payable to the Agent and the Lenders under this Agreement and
the other Loan Documents and the termination of this Agreement and the other
Loan Documents.
19
9.7 GOVERNING LAW; WAIVERS AND JURISDICTION.
(a) GOVERNING LAW. This Agreement will in all respects
be governed by, and construed and enforced in accordance with, the laws of
the State of California, without giving effect to any choice of law or
conflict of law rules or provisions (whether of the State of California or
any other jurisdiction) that would cause the application of the laws of any
jurisdiction other than the State of California, except that the filing,
perfection, effect of perfection and enforcement of security interests and
liens under this Agreement in other jurisdictions will be governed by the
laws of the applicable jurisdictions in accordance with the UCC as in effect
in the State of California.
(b) WAIVERS. To the extent permitted by law, each party
hereto hereby waives personal service of any and all process upon it in
connection with this Agreement and agrees that all such service of process
may be made as provided in Section 9.5, and service so made will be deemed to
be completed as provided in Section 9.5. In addition, the Grantor and the
Agent each hereby waives trial by jury, any objections based on FORUM NON
CONVENIENS and any objections to venue of any action arising out of,
connected with, related to or incidental to the transactions contemplated by
or the relationships established in connection with this Agreement.
(c) EXCLUSIVE JURISDICTION. Except as provided in
Section 9.7(d), all disputes arising out of, connected with, related to or
incidental to the transactions contemplated by or the relationship
established between them in connection with this Agreement, and whether
arising in contract, tort, equity or otherwise, will be resolved only by
state or federal courts located in New York County, New York, and the Grantor
and the Agent hereby consent and submit to the jurisdiction of any state or
federal court located within such county and state. The Grantor and the
Agent acknowledge, however, that any appeals from those courts may be
required to be heard by a court located outside of New York County, New York.
The Grantor and the Agent waive in all disputes any objection that it may
have to the location of the court considering the dispute. Nothing in this
Section 9.7(d) will affect the right of the Grantor or the Agent to serve
legal process in any other manner permitted by law or affect the right of the
Agent to bring any action or proceeding against the Grantor or its property
in the courts of any other jurisdiction.
(d) OTHER JURISDICTIONS. The Grantor and the Agent agree
that the other of them will have the right to proceed against it in a court
in any location to enable the proceeding Person to enforce a judgment or
other court order obtained in any proceeding brought in accordance with
Section 9.7(c) and entered in favor of the proceeding Person. The Grantor
and the Agent waive any objection that they may have to the location of the
court in which the other of them has commenced a proceeding described in this
Section 9.7(d).
9.8 HEREIN, ETC. Words such as "herein," "hereunder,"
"hereof" and the like will be deemed to refer to this Agreement as a whole
and not to any particular document or Article, Section or other portion of a
document. Section, clause, Exhibit and
20
Schedule references contained in this Agreement are references to Sections,
clauses, Exhibits and Schedules in or attached to this Agreement, unless
otherwise specified. Each defined term used in this Agreement has a
comparable meaning when used in its plural or singular form. Each
gender-specific term used in this Agreement has a comparable meaning whether
used in a masculine, feminine or gender-neutral form. As used in this
Agreement, the terms "knowledge" or "aware" will include the actual knowledge
and awareness of the Person in question, and the knowledge and awareness that
such Person would have obtained after making reasonable inquiry and
exercising reasonable diligence with respect to the matter in question.
Whenever the term "including" is used in this Agreement (whether or not that
term is followed by the phrase "but not limited to" or "without limitation"
or words of similar effect) in connection with a listing of items within a
particular classification, that listing will be interpreted to be
illustrative only and will not be interpreted as a limitation on, or an
exclusive listing of, the items within that classification. Each reference
in this Agreement to any law will be deemed to include such law as it
hereafter may be amended, supplemented or modified from time to time and any
successor thereto.
9.9 SEVERABILITY. Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Agreement is held to be
prohibited by or invalid under applicable law in any jurisdiction, such
provision will be ineffective only to the extent of such prohibition or
invalidity, without invalidating any other provision of this Agreement or any
other Loan Document.
9.10 HEADINGS. Section and subsection headings in this
Agreement are included for convenience of reference only and will not
constitute a part of this Agreement for any other purpose.
9.11 COUNTERPARTS. This Agreement may be executed in multiple
counterparts and by any party hereto or thereto on separate counterparts,
each of which, when so executed and delivered, will be an original, but all
such counterparts will together constitute one and the same instrument.
9.12 INDEMNIFICATION. In consideration of the Agent's
execution and delivery of this Agreement and the Initial Lenders' making of
the Loans, and in addition to all other obligations of the Grantor under this
Agreement and the other Loan Documents, the Grantor will defend, protect,
indemnify and hold harmless the Agent, and all of its officers, directors,
employees and agents (including those retained in connection with the
transactions contemplated by this Agreement) (collectively, the
"INDEMNITEES") from and against any and all actions, causes of action, suits,
claims, losses, costs, penalties, fees, liabilities and damages and expenses
in connection therewith (irrespective of whether any such Indemnitee is a
party to the action for which indemnification hereunder is sought), and
including reasonable attorneys' fees and disbursements, but excluding claims
and losses arising from such Indemnitee's breach hereof or thereof or such
Indemnitee's gross negligence or willful misconduct (the "INDEMNIFIED
LIABILITIES"), incurred by the Indemnitees or any of them as a result of, or
arising out of, or relating to (i) any transaction financed or to be financed
in whole or in part, directly or indirectly,
21
with the proceeds of the Loans, (ii) the execution, delivery, performance or
enforcement of this Agreement, the Notes or the other Loan Documents and any
instrument, document or agreement executed pursuant hereto by any of the
Indemnitees or (iii) the Agent's status as an agent of the Lenders. To the
extent that the foregoing undertaking by the Grantor may be unenforceable for
any reason, the Grantor will make the maximum contribution to the payment and
satisfaction of each of the Indemnified Liabilities which is permissible
under applicable law. To the extent that the undertaking to indemnify, pay
and hold harmless by the Grantor under this Section 9.12 may be unenforceable
because it violates any law or public policy, the Grantor will contribute the
maximum portion that it is permitted to pay and satisfy under applicable law
or public policy to the payment and satisfaction of all Indemnified
Liabilities incurred by the Indemnities or any of them.
9.13 PAYMENT SET ASIDE. To the extent that the Grantor makes
a payment or payments to the Agent or any Lender hereunder or under the Notes
or any other Loan Document or any Lender or Agent enforces its security
interests or rights or exercises its right or setoff hereunder or thereunder,
and such payment or payments or the proceeds of such enforcement or setoff or
any part thereof are subsequently invalidated, declared to be fraudulent or
preferential, set aside, recovered from, disgorged by or are required to be
refunded, repaid or otherwise restored to the Grantor, a trustee, receiver or
any other Person under any law (including any bankruptcy law, state or
federal law, common law or equitable cause of action), then to the extent of
any such restoration the obligation or part thereof originally intended to be
satisfied and all Liens created under this Agreement will be revived and
continued in full force and effect as if such payment had not been made or
such enforcement or setoff had not occurred.
9.14 COMPLETE AGREEMENT. Except as otherwise expressly set
forth herein, this Agreement, the Notes and the other Loan Documents embody
the complete agreement and understanding of the parties hereto and thereto
and supersede and preempt any prior understandings, agreements or
representations by or among the parties, whether written or oral, which may
have related to the subject matter hereof in any way, and such agreements may
not be contradicted or varied by evidence of prior, contemporaneous or
subsequent oral discussions or understandings of the parties. The parties
hereto acknowledge and agree there are no oral understandings or agreements
between them with respect to the subject matter hereof or thereof.
9.15 NO STRICT CONSTRUCTION. The language used in this
Agreement and the other Loan Documents will be deemed to be the language
chosen by the parties to express their mutual intent. In the event an
ambiguity or question of intent or interpretation arises, this Agreement and
the other Loan Documents will be construed as if drafted jointly by the
parties, and no presumption or burden of proof will arise favoring or
disfavoring any Person by virtue of the authorship of any of the provisions
of this Agreement or any other Loan Document.
22
9.16 TERMINATION.
(a) This Agreement and the security interest granted
hereby will terminate when all the Obligations have been paid in full, at
which time the Agent will execute and deliver to the Grantor all Uniform
Commercial Code termination statements and similar documents prepared by the
Grantor which the Grantor will reasonably request to evidence such
termination.
(b) Notwithstanding anything to the contrary contained in
this Agreement, this Agreement will remain in full force and effect and
continue to be effective should any petition be filed by or against the
Grantor for liquidation or reorganization, should the Grantor become
insolvent or make an assignment for any benefit of creditors or should a
receiver or trustee be appointed for all or any significant part of the
Grantor's assets, and will continue to be effective or be reinstated, as the
case may be, if at any time payment and performance of the obligations, or
any part thereof, is, pursuant to applicable law, rescinded or reduced in
amount, or must otherwise be restored or returned by any obligee of the
obligations, whether as a "voidable preference," "fraudulent conveyance" or
otherwise, all as though such payment, or any part thereof, is rescinded,
reduced, restored or returned.
* * * * *
23
IN WITNESS WHEREOF, the parties hereto have executed this Security
Agreement as of the date first above written.
PAKISTAN WIRELESS HOLDINGS LIMITED
By: /s/ XXXXXXX X. XXXXXXXX
---------------------------------
Its: Executive Vice President
--------------------------------
TORONTO DOMINION INVESTMENTS, INC.,
as Agent
By: /s/ XXXXXX X. XXXXXXX
---------------------------------
Its:
--------------------------------
ANNEX I
A. Mailing Address: c/o International Wireless Communications, Inc.
000 X. Xx Xxxxxx Xxxx, Xxxxx 0000
Xxx Xxxxx, XX 00000 XXX
Attn: Xxxxxxx X. Xxxxxxxx, CFO
Xxxxx X. Xxxxxxx, VP, Legal Affairs
With a copy to:
XX Xxx 0000
0xx Xxxxx Xx Xxx Xx Xxxxxxxx
12 Xxxx Xxxxxx Street
Port Louis, Mauritius
Attn: X. Xxxxxxx
B. Location of Chief
Executive Office: XX Xxx 0000
0xx Xxxxx Xx Xxx Xx Xxxxxxxx
00 Xxxx Xxxxxx Street
Port Louis, Mauritius
C. Location of Inventory
Equipment and Fixtures: Not applicable.
ANNEX II
TRADE NAMES
None
ANNEX III
VEHICLES
None
ANNEX IV
INTELLECTUAL PROPERTY COLLATERAL
None
ANNEX V
BANK ACCOUNTS
Bank Account Type and No.
---- --------------------
Bank of America Checking Account
The Private Bank No. 13293-05814
San Francisco - #0000
00 Xxxxxxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
The Hongkong & Shanghai Banking Corporation US Dollar Account
Offshore Banking Unit No. 080-026362
Xxxxx Xxxxxx Street
Port Louis, Mauritius
