EXHIBIT 10.2
------------
SECURITY AGREEMENT
THIS SECURITY AGREEMENT, dated as of the 22nd day of January, 1999 (this
"Agreement"), is made by THE XXXXXXXX GROUP, INC., a Delaware corporation (the
"Borrower"), and by each of the undersigned Subsidiaries of the Borrower and
each other Subsidiary that, after the date hereof, executes an instrument of
accession hereto substantially in the form of Exhibit C (a "Pledgor Accession";
---------
the undersigned and such other Subsidiaries, collectively, the "Subsidiary
Pledgors," and together with the Borrower, the "Pledgors"), in favor of FIRST
UNION NATIONAL BANK, as administrative agent for the banks and other financial
institutions (collectively, the "Lenders") party to the Credit Agreement
referred to below (in such capacity, the "Administrative Agent"), for the
benefit of the Secured Parties (as hereinafter defined). Capitalized terms used
herein without definition shall have the meanings given to them in the Credit
Agreement referred to below.
RECITALS
A. The Borrower, the Lenders and the Administrative Agent are parties to a
Credit Agreement, dated as of January 22, 1999 (as amended, modified or
supplemented from time to time, the "Credit Agreement"), providing for the
availability of certain credit facilities to the Borrower upon the terms and
subject to the conditions set forth therein.
B. It is a condition to the extension of credit to the Borrower under the
Credit Agreement, that the Borrower and each of the Subsidiary Pledgors that is
a party to this Agreement as of the date hereof, shall have agreed, by executing
and delivering this Agreement, to secure the payment in full of the Obligations
of the Borrower under the Credit Agreement and the other Credit Documents.
C. Each of the Subsidiaries of the Borrower shall, upon the repayment of
the 10.48% Senior Subordinated Notes due 2000 or in the event such notes no
longer limit the ability of such Subsidiaries to guarantee the Obligations,
enter into a Subsidiary Guaranty pursuant to which such Subsidiaries will
guarantee to the Secured Parties the payment in full of the Obligations of the
Borrower under the Credit Agreement and the other Credit Documents.
D. The Secured Parties are relying on this Agreement in their decision to
extend credit to the Borrower under the Credit Agreement, and would not enter
into the Credit Agreement without the execution and delivery of this Agreement
by the Pledgors.
E. The Pledgors will obtain benefits as a result of the extension of
credit to the Borrower under the Credit Agreement, which benefits are hereby
acknowledged, and, accordingly, desire to execute and deliver this Agreement.
STATEMENT OF AGREEMENT
NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, to induce the Secured Parties to enter into the Credit Agreement
and to induce the Lenders to extend credit to the Borrower thereunder, each
Pledgor hereby agrees as follows:
ARTICLE I
DEFINITIONS
1.1 Defined Terms. For purposes of this Agreement, in addition to the
-------------
terms defined elsewhere herein, the following terms shall have the meanings set
forth below:
"Accounts" shall mean, collectively, all of each Pledgor's accounts, as
defined in the Uniform Commercial Code, including, without limitation, all of
such Pledgor's accounts receivable, all rights to payment for goods sold or
leased or to be sold or to be leased (including all rights to returned or
repossessed goods) or for services rendered at any time or for services to be
rendered (including any rights to stoppage in transit, repossession and
reclamation and other rights of an unpaid vendor or secured party), all rights
under or evidenced by book debts, notes, bills, drafts or acceptances, all
Instruments evidencing or relating to any of the foregoing, and all rights under
security agreements, guarantees, indemnities and other instruments and contracts
securing or otherwise relating to any of the foregoing, in each case whether now
owned or existing or hereafter acquired or arising.
"Collateral" shall have the meaning given to such term in SECTION 2.1.
"Collateral Accounts" shall have the meaning given to such term in SECTION
5.3.
"Concentration Account" shall have the meaning given to such term in
SECTION 4.14.
"Concentration Agreement" shall have the meaning given to such term in
SECTION 4.14.
"Contracts" shall mean, collectively, all rights of each Pledgor under all
leases, contracts and agreements to which such Pledgor is now or hereafter a
party, including, without limitation, all rights, privileges and powers under
Licenses, together with any and all extensions, modifications, amendments and
renewals of such leases, contracts and agreements and all rights of such Pledgor
to receive moneys due or to become due thereunder or pursuant thereto and to
amend, modify, terminate or exercise rights under such leases, contracts and
agreements, but excluding rights under (but not excluding Proceeds of) any
lease, contract or agreement (including, without limitation, any License) that
by the terms thereof, or under applicable law,
2
cannot be assigned or a security interest granted therein in the manner
contemplated by this Agreement unless consent from the relevant party or parties
has been obtained and under the terms of which lease, contract or agreement any
such assignment or grant of a security interest therein in the absence of such
consent would, or could, result in the termination thereof, but only to the
extent that (y) such rights are subject to such contractual or legal restriction
and (z) such restriction is not, or could not be, rendered ineffective pursuant
to the Uniform Commercial Code of any relevant jurisdiction or any other
applicable law (including the Bankruptcy Code) or principles of equity.
"Copyrights" shall mean, collectively, all of each Pledgor's copyrights,
copyright registrations and applications for copyright registration, whether
under the laws of the United States or any other country or jurisdiction,
including all recordings, supplemental registrations and derivative or
collective work registrations, and all renewals and extensions thereof, in each
case whether now owned or existing or hereafter acquired or arising.
"Copyright Collateral" shall mean, collectively, all Copyrights and
Copyright Licenses to which any Pledgor is or hereafter becomes a party and all
other General Intangibles embodying, incorporating, evidencing or otherwise
relating or pertaining to any Copyright or Copyright License, in each case
whether now owned or existing or hereafter acquired or arising.
"Copyright License" shall mean any agreement now or hereafter in effect
granting any right to any third party under any Copyright now or hereafter owned
by any Pledgor or which any Pledgor otherwise has the right to license, or
granting any right to any Pledgor under any property of the type described in
the definition of Copyright herein now or hereafter owned by any third party,
and all rights of any Pledgor under any such agreement.
"Deposit Accounts" shall mean, collectively, all of each Pledgor's deposit
accounts maintained with the Administrative Agent or any other bank or
depository institution, whether now owned or existing or hereafter acquired or
arising and including, without limitation, all Concentration Accounts and any
Collateral Accounts, together with all funds held from time to time therein and
all certificates and instruments from time to time representing, evidencing or
deposited into such accounts.
"Equipment" shall mean, collectively, all of each Pledgor's equipment, as
defined in the Uniform Commercial Code, including, without limitation, all
machinery, equipment, computer equipment and software, parts, supplies,
appliances, fittings, furniture and fixtures of every kind and nature, wherever
located and whether or not affixed to any real property, all Mobile Goods, and
all accessions, accessories, additions, attachments, improvements, modifications
and upgrades to, replacements of and substitutions for the foregoing, in each
case whether now owned or existing or hereafter acquired.
"General Intangibles" shall mean, collectively, all of each Pledgor's
general intangibles, as defined in the Uniform Commercial Code, including,
without limitation, all Contracts, all Copyright Collateral, all Patent
Collateral, all Trademark Collateral, all inventions, designs, trade secrets,
trade processes, confidential or proprietary technical or business information,
know-how, registrations, licenses, permits and franchises, all rights under or
evidenced by choses in action,
3
causes of action or Instruments, all indebtedness, obligations and other amounts
at any time owing to such Pledgor from any Person and all interest, cash,
instruments and other property from time to time received, receivable or
otherwise distributed in respect of or in exchange for any or all of such
indebtedness, obligations or other amounts (including, without limitation, all
Intercompany Obligations), all judgments, tax refund claims, claims against
carriers and shippers, claims under liens and insurance policies, all rights
under security agreements, guarantees, indemnities and other instruments and
contracts securing or otherwise relating to any of the foregoing, all invoices,
customer lists, books and records, ledger and account cards, computer tapes,
disks, software, printouts and other corporate or business records relating to
the foregoing, and all other intangible personal property of every kind and
nature, and all accessions, additions, improvements, modifications and upgrades
to, replacements of and substitutions for the foregoing, in each case whether
now owned or existing or hereafter acquired or arising, but excluding Accounts
and excluding leases, contracts and agreements (including, without limitation,
Licenses) to the extent excluded from Contracts under the definition of such
term herein. Without in any way limiting the foregoing, "General Intangibles"
shall specifically include (i) FCC Licenses of the Pledgors (the "FCC
Licenses"), but only to the extent, if any, permitted by applicable law,
including without limitation the Communications Act of 1934, as amended, and FCC
and/or FCC Licenses Rules and Regulations, (ii) all proceeds from the
disposition of any radio or television station owned or operated by any Pledgor,
and (iii) the "going concern value" of such stations.
"Instruments" shall mean, collectively, all instruments, chattel paper or
documents, each as defined in the Uniform Commercial Code, of each Pledgor,
whether now owned or existing or hereafter acquired, including those evidencing,
representing, securing, arising from or otherwise relating to any Accounts,
Intercompany Obligations or other Collateral, including, without limitation, any
promissory notes, drafts, bills of exchange, documents of title and receipts.
"Intercompany Obligations" shall mean, collectively, all indebtedness,
obligations and other amounts at any time owing to any Pledgor from any of its
Subsidiaries or Affiliates and all interest, cash, instruments and other
property from time to time received, receivable or otherwise distributed in
respect of or in exchange for any or all of such indebtedness, obligations or
other amounts.
"Investment Agreement" shall mean any partnership agreement, joint venture
agreement, limited liability company operating agreement, stockholders agreement
or other agreement creating, governing or evidencing any equity interests and to
which any Pledgor is now or hereafter becomes a party, as any such agreement may
be amended, modified, supplemented, restated or replaced from time to time.
"Investment Property" shall mean, collectively, all of each Pledgor's
investment property, as defined in the Uniform Commercial Code, including,
without limitation, all certificated securities, uncertificated securities,
security entitlements, securities accounts, commodity contracts and commodity
accounts (as such terms are defined in the Uniform Commercial Code) of or held
by such Pledgor, together with all rights to receive interest, income,
dividends, distributions, returns of capital and other amounts (whether in cash,
securities, property, or a
4
combination thereof), and all additional stock, warrants, options, securities,
interests and other property, from time to time paid or payable or distributed
or distributable in respect of any of the foregoing; and all other rights,
powers, privileges, interests, claims and other property in any manner arising
out of or relating to any of the foregoing, of whatever kind or character;
together with all certificates, instruments and entries upon the books of
financial intermediaries at any time evidencing any of the foregoing, in each
case whether now owned or existing or hereafter acquired or arising.
"Inventory" shall mean, collectively, all of each Pledgor's inventory, as
defined in the Uniform Commercial Code, including, without limitation, all goods
manufactured, acquired or held for sale or lease, all raw materials, component
materials, work-in-process and finished goods, all supplies, goods and other
items and materials used or consumed in the manufacture, production, packaging,
shipping, selling, leasing or furnishing of such inventory or otherwise in the
operation of the business of such Pledgor, all goods in which such Pledgor now
or at any time hereafter has any interest or right of any kind, and all goods
that have been returned to or repossessed by or on behalf of such Pledgor, in
each case whether or not the same is in transit or in the constructive, actual
or exclusive occupancy or possession of such Pledgor or is held by such Pledgor
or by others for the account of such Pledgor, and in each case whether now owned
or existing or hereafter acquired or arising.
"License" shall mean any Copyright License, Patent License or Trademark
License.
"Mobile Goods" shall mean, collectively, all of each Pledgor's motor
vehicles, tractors, trailers, aircraft, rolling stock and other like property,
whether or not the title thereto is governed by a certificate of title or
ownership, in each case whether now owned or existing or hereafter acquired.
"Patents" shall mean, collectively, all of each Pledgor's letters patent,
whether under the laws of the United States or any other country or
jurisdiction, all recordings and registrations thereof and applications
therefor, including, without limitation, the inventions described therein, all
reissues, continuations, divisions, renewals, extensions, continuations-in-part
thereof, in each case whether now owned or existing or hereafter acquired or
arising.
"Patent Collateral" shall mean, collectively, all Patents and all Patent
Licenses to which any Pledgor is or hereafter becomes a party and all other
General Intangibles embodying, incorporating, evidencing or otherwise relating
or pertaining to any Patent or Patent License, in each case whether now owned or
existing or hereafter acquired or arising.
"Patent License" shall mean any agreement now or hereafter in effect
granting to any third party any right to make, use or sell any invention on
which a Patent, now or hereafter owned by any Pledgor or which any Pledgor
otherwise has the right to license, is in existence, or granting to any Pledgor
any right to make, use or sell any invention on which property of the type
described in the definition of Patent herein, now or hereafter owned by any
third party, is in existence, and all rights of any Pledgor under any such
agreement.
"Proceeds" shall have the meaning given to such term in SECTION 2.1.
5
"Secured Parties" shall mean, collectively, the Lenders (including the
Issuing Lender and including any Lender in its capacity as a counterparty to any
Hedge Agreement with the Borrower) and the Administrative Agent.
"Specified Contracts" shall have the meaning given to such term in SECTION
3.7.
"Trademarks" shall mean, collectively, all of each Pledgor's trademarks,
service marks, trade names, corporate and company names, business names, logos,
trade dress, trade styles, other source or business identifiers, designs and
general intangibles of a similar nature, whether under the laws of the United
States or any other country or jurisdiction, all recordings and registrations
thereof and applications therefor, all renewals and extensions thereof, all
rights corresponding thereto, and all goodwill associated therewith or
symbolized thereby, in each case whether now owned or existing or hereafter
acquired or arising.
"Trademark Collateral" shall mean, collectively, all Trademarks and
Trademark Licenses to which any Pledgor is or hereafter becomes a party and all
other General Intangibles embodying, incorporating, evidencing or otherwise
relating or pertaining to any Trademark or Trademark License, in each case
whether now owned or existing or hereafter acquired or arising.
"Trademark License" shall mean any agreement now or hereafter in effect
granting any right to any third party under any Trademark now or hereafter owned
by any Pledgor or which any Pledgor otherwise has the right to license, or
granting any right to any Pledgor under any property of the type described in
the definition of Trademark herein now or hereafter owned by any third party,
and all rights of any Pledgor under any such agreement.
"Uniform Commercial Code" shall mean the Uniform Commercial Code as the
same may be in effect from time to time in the State of North Carolina; provided
that if, by reason of applicable law, the validity or perfection of any security
interest in any Collateral granted under this Agreement is governed by the
Uniform Commercial Code as in effect in a jurisdiction other than North
Carolina, then as to the validity or perfection, as the case may be, of such
security interest, "Uniform Commercial Code" shall mean the Uniform Commercial
Code as in effect in such other jurisdiction.
1.2 Other Terms. All terms in this Agreement that are not capitalized
-----------
shall have the meanings provided by the Uniform Commercial Code to the extent
the same are used or defined therein.
ARTICLE II
CREATION OF SECURITY INTEREST
2.1 Pledge and Grant of Security Interest. Each Pledgor hereby pledges,
-------------------------------------
assigns and delivers to the Administrative Agent, for the ratable benefit of the
Secured Parties, and grants to the Administrative Agent, for the ratable benefit
of the Secured Parties, a Lien upon and security interest in, all of such
Pledgor's right, title and interest in and to the following, in each case
whether now owned or existing or hereafter acquired or arising (collectively,
the "Collateral"):
6
(i) all Accounts;
(ii) all Contracts;
(iii) all Deposit Accounts;
(iv) all Equipment;
(v) all General Intangibles;
(vi) all Inventory;
(vii) all Investment Property;
(viii) all Instruments;
(ix) to the extent not covered or not specifically excluded by
clauses (i) through (viii) above, all of such Pledgor's other personal
property, whether now owned or existing or hereafter arising or acquired;
and
(x) any and all proceeds, as defined in the Uniform Commercial Code,
products, rents and profits of or from any and all of the foregoing and, to
the extent not otherwise included in the foregoing, (w) all payments under
any insurance (whether or not the Administrative Agent is the loss payee
thereunder), indemnity, warranty or guaranty with respect to any of the
foregoing Collateral, (x) all payments in connection with any requisition,
condemnation, seizure or forfeiture with respect to any of the foregoing
Collateral, (y) all claims and rights to recover for any past, present or
future infringement or dilution of or injury to any Copyright Collateral,
Patent Collateral or Trademark Collateral, and (z) all other amounts from
time to time paid or payable under or with respect to any of the foregoing
Collateral (collectively, "Proceeds"). For purposes of this Agreement, the
term "Proceeds" includes whatever is receivable or received when Collateral
or Proceeds are sold, exchanged, collected or otherwise disposed of,
whether voluntarily or involuntarily.
provided, however, for purposes of this Agreement, the term "Collateral" shall
-------- -------
not include any right, title or interest in any asset of SSI, Inc., the granting
of which Lien would require the approval of the National Basketball Association
(including the Seattle Supersonics NBA franchise).
2.2 Security for Secured Obligations. This Agreement and the Collateral
--------------------------------
secure the full and prompt payment, at any time and from time to time as and
when due (whether at the stated maturity, by acceleration or otherwise), of all
liabilities and obligations of each Pledgor, whether now existing or hereafter
incurred, created or arising and whether direct or indirect, absolute or
contingent, due or to become due, under, arising out of or in connection with
the Credit Agreement, this Agreement, any Subsidiary Guaranty or any of the
other Credit
7
Documents to which it is or hereafter becomes a party, or any Hedge Agreement to
which the Borrower and any Lender are parties, including, without limitation,
(i) in the case of the Borrower, all Obligations, including, without limitation,
all principal of and interest on the Loans, all fees, expenses, indemnities and
other amounts payable by the Borrower under the Credit Agreement or any other
Credit Document (including interest accruing after the filing of a petition or
commencement of a case by or with respect to the Borrower seeking relief under
any applicable federal and state laws pertaining to bankruptcy, reorganization,
arrangement, moratorium, readjustment of debts, dissolution, liquidation or
other debtor relief, specifically including, without limitation, the Bankruptcy
Code and any fraudulent transfer and fraudulent conveyance laws, whether or not
the claim for such interest is allowed in such proceeding), and all obligations
of the Borrower to any Lender under any Hedge Agreement required or permitted
under the Credit Agreement and to which the Borrower and such Lender are
parties, and (ii) in the case of any Subsidiary Pledgor, all of its liabilities
and obligations as a Guarantor (as defined in the Subsidiary Guaranty), if any,
in respect of the Obligations; and in each case under (i) and (ii) above, (a)
all such liabilities and obligations that, but for the operation of the
automatic stay under Section 362(a) of the Bankruptcy Code, would become due,
and (b) all fees, costs and expenses payable by such Pledgor under SECTION 7.1
(the liabilities and obligations of the Pledgors described in this SECTION 2.2,
collectively, the "Secured Obligations").
2.3 FCC Matters. Notwithstanding anything herein to the contrary, prior
-----------
to the occurrence of an Event of Default and the consent of the FCC and of any
other applicable Governmental Authority to the assignment of any FCC License or
the transfer of control of any Pledgor (as may be required by law), neither this
Agreement, the Credit Agreement, the Credit Documents nor any of the
transactions contemplated hereby and thereby will constitute, create, or have
the effect of constituting or creating, directly or indirectly, actual or
practical ownership of any Pledgor by the Administrative Agent or the Secured
Parties or control, affirmative or negative, direct or indirect, by the
Administrative Agent or the Secured Parties over the management or any other
aspect of the operation of any Pledgor, which ownership and control remain
exclusively and at all times in such Pledgor until such time as the FCC approves
the transfer of such rights to another party.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Each Pledgor represents and warrants as follows:
3.1 Ownership of Collateral. Each Pledgor owns, or has valid rights as a
-----------------------
lessee or licensee with respect to, all Collateral purported to be pledged by it
hereunder, free and clear of any Liens except for the Liens granted to the
Administrative Agent, for the benefit of the Secured Parties, pursuant to this
Agreement, and except for other Permitted Liens. No security agreement,
financing statement or other public notice with respect to all or any part of
the Collateral is on file or of record in any government or public office, and
no Pledgor has filed or consented to the filing of any such statement or notice,
except (i) Uniform Commercial Code
8
financing statements naming the Administrative Agent as secured party, (ii)
security instruments filed in the U.S. Copyright Office or the U.S. Patent and
Trademark Office naming the Administrative Agent as secured party and (iii) as
may be otherwise permitted by the Credit Agreement.
3.2 Security Interests; Filings. This Agreement, together with (i) the
---------------------------
filing, with respect to each Pledgor, of duly completed and executed Uniform
Commercial Code financing statements naming such Pledgor as debtor, the
Administrative Agent as secured party, and describing the Collateral, in the
jurisdictions set forth with respect to such Pledgor on Annex A hereto, which
-------
have been duly executed and delivered by the Pledgors and delivered to the
Administrative Agent for filing, (ii) to the extent required by applicable law,
the filing, with respect to each relevant Pledgor, of duly completed and
executed assignments in the forms set forth as Exhibits A and B with the U.S.
---------- -
Copyright Office or the U.S. Patent and Trademark Office, as appropriate, with
regard to registered Copyright Collateral, Patent Collateral and Trademark
Collateral of such Pledgor, as the case may be, (iii) in the case of Investment
Property evidenced by uncertificated securities, compliance with Article 8 of
the applicable Uniform Commercial Code, (iv) upon request of the Administrative
Agent, as to Mobile Goods covered by a certificate of title or ownership, the
notation of the Administrative Agent's security interest therein on the
applicable certificates of title or ownership, and (v) the delivery to the
Administrative Agent of all chattel paper, promissory notes and other
Instruments included in the Collateral (and assuming continued possession
thereof by the Administrative Agent), creates, and at all times shall
constitute, a valid and perfected security interest in and Lien upon the
Collateral in favor of the Administrative Agent, for the benefit of the Secured
Parties, to the extent a security interest therein can be perfected by such
filings or possession, as applicable, superior and prior to the rights of all
other Persons therein (except for Permitted Liens), and no other or additional
filings, registrations, recordings or actions are or shall be necessary or
appropriate in order to maintain the perfection and priority of such Lien and
security interest, other than actions required with respect to Collateral of the
types excluded from Article 9 of the Uniform Commercial Code or from the filing
requirements under such Article 9 by reason of Section 9-104 or 9-302 of the
Uniform Commercial Code and other than continuation statements required under
the Uniform Commercial Code (it being specifically noted that the Administrative
Agent may at its option, but shall not be required to, require that any bank or
other depository institution at which a Deposit Account is maintained enter into
a written agreement or take such other action as may be necessary to perfect the
security interest of the Administrative Agent in such Deposit Account and the
funds therein).
3.3 Locations. Annex B lists, as to each Pledgor, (i) the addresses of
--------- -------
its chief executive office and each other place of business, (ii) the address of
each location of all original invoices, ledgers, chattel paper, Instruments and
other records or information evidencing or relating to the Collateral of such
Pledgor, and (iii) the address of each location at which any Equipment or
Inventory (other than Mobile Goods and goods in transit) owned by such Pledgor
is kept or maintained, in each instance except for any new locations established
in accordance with the provisions of SECTION 4.2. Except as may be otherwise
noted therein, all locations identified in Annex B are leased by the applicable
-------
Pledgor. No Pledgor presently conducts business under any prior or other
corporate or company name or under any trade or fictitious
9
names, except as indicated beneath its name on Annex B, and no Pledgor has
-------
entered into any contract or granted any Lien within the past five years under
any name other than its legal corporate name or a trade or fictitious name
indicated on Annex B.
-------
3.4 Authorization; Consent. No authorization, consent or approval of, or
----------------------
declaration or filing with, any Governmental Authority (including, without
limitation, any notice filing with state tax or revenue authorities required to
be made by account creditors in order to enforce any Accounts in such state) is
required for the valid execution, delivery and performance by any Pledgor of
this Agreement, the grant by it of the Lien and security interest in favor of
the Administrative Agent provided for herein, or the exercise by the
Administrative Agent of its rights and remedies hereunder, except for (i) the
filings described in SECTION 3.2, and (ii) in the case of Accounts owing from
any federal governmental agency or authority, the filing by the Administrative
Agent of a notice of assignment in accordance with the federal Assignment of
Claims Act of 1940, as amended, and (iii) in the case of Investment Property,
except as may be required in connection with a disposition of any such
collateral by laws affecting the offering and sale of securities, generally.
3.5 No Restrictions. There are no statutory or regulatory restrictions,
---------------
prohibitions or limitations on any Pledgor's ability to grant to the
Administrative Agent a Lien upon and security interest in the Collateral
pursuant to this Agreement or (except for the provisions of the federal Anti-
Assignment Act and Anti-Claims Act, as amended) on the exercise by the
Administrative Agent of its rights and remedies hereunder (including any
foreclosure upon or collection of the Collateral), and there are no contractual
restrictions on any Pledgor's ability so to grant such Lien and security
interest.
3.6 Accounts. Each Account is, or at the time it arises will be, (i) a
--------
bona fide, valid and legally enforceable indebtedness of the account debtor
according to its terms, arising out of or in connection with the sale, lease or
performance of goods or services by the Pledgors or any of them, (ii) subject to
no offsets, discounts, counterclaims, contra accounts or any other defense of
any kind and character, other than warranties and discounts customarily given by
the Pledgors in the ordinary course of business and warranties provided by
applicable law, (iii) to the extent listed on any schedule of Accounts at any
time furnished to the Administrative Agent, a true and correct statement of the
amount actually and unconditionally owing thereunder, maturing as stated in such
schedule and in the invoice covering the transaction creating such Account, and
(iv) not evidenced by any chattel paper or other Instrument; or if so, such
chattel paper or other Instrument (other than invoices and related
correspondence and supporting documentation) shall promptly be duly endorsed to
the order of the Administrative Agent and delivered to the Administrative Agent
to be held as Collateral hereunder. To the knowledge of each Pledgor, there are
no facts, events or occurrences that would in any way impair the validity or
enforcement of any Accounts except as set forth above.
3.7 Specified Contracts. As to each Investment Agreement and each other
-------------------
Material Contract to which any Pledgor is or hereafter becomes a party (the
foregoing, collectively, "Specified Contracts"), (i) such Pledgor is not in
default in any material respect under any such Specified Contracts, and to the
knowledge of such Pledgor, none of the other parties to such
10
Specified Contracts is in default in any material respect thereunder (except as
shall have been disclosed in writing to the Administrative Agent), (ii) each
such Specified Contract is, or at the time of execution will be, the legal,
valid and binding obligation of all parties thereto, enforceable against such
parties in accordance with the respective terms thereof, subject to applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting
creditors' rights generally, and no defense, offset, deduction or counterclaim
will exist thereunder in favor of any such party, (iii) the performance by such
Pledgor of its obligations under each such Specified Contract in accordance with
its terms will not contravene any Requirement of Law or any contractual
restriction binding on or affecting such Pledgor or any of its properties, and
will not result in or require the creation of any Lien upon or with respect to
any of its properties, and (iv) such Pledgor has (or promptly after the time of
execution will have) furnished the Administrative Agent with a correct and
complete copy of each Specified Contract to which it is a party as then in
effect.
3.8 Intellectual Property. Annexes C, D and E correctly set forth all
--------------------- ------------ -
registered Copyrights, Patents and Trademarks owned by any Pledgor as of the
date hereof and used or proposed to be used in its business. Each such Pledgor
owns or possesses the valid right to use all Copyrights, Patents and Trademarks;
all registrations therefor have been validly issued under applicable law and are
in full force and effect; no claim has been made in writing or, to the knowledge
of such Pledgor, orally, that any of the Copyrights, Patents or Trademarks is
invalid or unenforceable or violates or infringes the rights of any other
Person, and there is no such violation or infringement in existence; and to the
knowledge of such Pledgor, no other Person is presently infringing upon the
rights of such Pledgor with regard to any of the Copyrights, Patents or
Trademarks.
3.9 Documents of Title. No xxxx of lading, warehouse receipt or other
------------------
document or instrument of title is outstanding with respect to any Collateral
other than Mobile Goods and other than Inventory in transit in the ordinary
course of business to a location set forth on Annex B or to a customer of a
-------
Pledgor.
ARTICLE IV
COVENANTS
4.1 Use and Disposition of Collateral. So long as no Event of Default
---------------------------------
shall have occurred and be continuing, each Pledgor may, in any lawful manner
not inconsistent with the provisions of this Agreement and the other Credit
Documents, use, control and manage the Collateral in the operation of its
businesses, and receive and use the income, revenue and profits arising
therefrom and the Proceeds thereof, in the same manner and with the same effect
as if this Agreement had not been made; provided, however, that no Pledgor will
-------- -------
sell or otherwise dispose of, grant any option with respect to, or mortgage,
pledge, grant any Lien with respect to or otherwise encumber any of the
Collateral or any interest therein, except for the security interest created in
favor of the Administrative Agent hereunder and except as may be otherwise
expressly permitted in accordance with the terms of this Agreement and the
Credit Agreement (including
11
any applicable provisions therein regarding delivery of proceeds of sale or
disposition to the Administrative Agent).
4.2 Change of Name, Locations, etc. No Pledgor will (i) change its name,
-------------------------------
identity or corporate structure, (ii) change its chief executive office from the
location thereof listed on Annex B, or (iii) remove any Collateral (other than
-------
Mobile Goods and goods in transit), or any books, records or other information
relating to Collateral, from the applicable location thereof listed on Annex B,
-------
or keep or maintain any Collateral at a location not listed on Annex B, unless
-------
in each case such Pledgor has (1) given reasonable prior written notice to the
Administrative Agent of its intention to do so, together with information
regarding any such new location and such other information in connection with
such proposed action as the Administrative Agent may reasonably request, and (2)
delivered to the Administrative Agent prior to any such change or removal such
documents, instruments and financing statements as may be required by the
Administrative Agent, all in form and substance satisfactory to the
Administrative Agent, paid all necessary filing and recording fees and taxes,
and taken all other actions reasonably requested by the Administrative Agent
(including, at the request of the Administrative Agent, delivery of opinions of
counsel reasonably satisfactory to the Administrative Agent to the effect that
all such actions have been taken), in order to perfect and maintain the Lien
upon and security interest in the Collateral provided for herein in accordance
with the provisions of SECTION 3.2.
4.3 Records; Inspection. (a) Each Pledgor will keep and maintain at its
-------------------
own cost and expense satisfactory and complete records of the Accounts and all
other Collateral, including, without limitation, records of all payments
received, all credits granted thereon, all merchandise returned and all other
documentation relating thereto, and will furnish to the Administrative Agent
from time to time such statements, schedules and reports (including, without
limitation, accounts receivable aging schedules) with regard to the Collateral
as the Administrative Agent may reasonably request.
(b) Each Pledgor shall, from time to time at such times as may be
reasonably requested and upon reasonable notice, (i) make available to the
Administrative Agent for inspection and review at such Pledgor's offices copies
of all invoices and other documents and information relating to the Collateral
(including, without limitation, itemized schedules of all collections of
Accounts, showing the name of each account debtor, the amount of each payment
and such other information as the Administrative Agent shall reasonably
request), and (ii) permit the Administrative Agent or its representatives to
visit its offices or the premises upon which any Collateral may be located,
inspect its books and records and make copies and memoranda thereof, inspect the
Collateral, discuss its finances and affairs with its officers, employees and
independent accountants and take any other actions necessary for the protection
of the interests of the Secured Parties in the Collateral. At the request of
the Administrative Agent, each Pledgor will legend, in form and manner
satisfactory to the Administrative Agent, the books, records and materials
evidencing or relating to the Collateral with an appropriate reference to the
fact that the Collateral has been assigned to the Administrative Agent and that
the Administrative Agent has a security interest therein. The Administrative
Agent shall have the right to make test verifications of Accounts in any
reasonable manner and through any reasonable medium, and each Pledgor
12
agrees to furnish all such reasonable assistance and information as the
Administrative Agent may require in connection therewith.
4.4 Accounts. Unless notified otherwise by the Administrative Agent in
--------
accordance with the terms hereof, each Pledgor shall endeavor to collect its
Accounts and all amounts owing to it thereunder in the ordinary course of its
business consistent with past practices and shall apply forthwith upon receipt
thereof all such amounts as are so collected to the outstanding balances
thereof, and in connection therewith shall, at the request of the Administrative
Agent, take such action as the Administrative Agent may deem necessary or
advisable (within applicable laws) to enforce such collection. No Pledgor
shall, except to the extent done in the ordinary course of its business
consistent with past practices and in accordance with sound business judgment
and provided that no Event of Default shall have occurred and be continuing, (i)
grant any extension of the time for payment of any Account, (ii) compromise or
settle any Account for less than the full amount thereof, (iii) release, in
whole or in part, any Person or property liable for the payment of any Account,
or (iv) allow any credit or discount on any Account. Each Pledgor shall
promptly inform the Administrative Agent of any disputes with any account debtor
or obligor and of any claimed offset and counterclaim that may be asserted with
respect thereto involving, in each case, $1,000,000 or more, where such Pledgor
reasonably believes that the likelihood of payment by such account debtor is
materially impaired, indicating in detail the reason for the dispute, all claims
relating thereto and the amount in controversy.
4.5 Instruments. Each Pledgor agrees that if any Intercompany
-----------
Obligations, Accounts or other Collateral shall at any time be evidenced by a
promissory note, chattel paper or other Instrument, the same shall promptly be
duly endorsed to the order of the Administrative Agent and delivered to the
Administrative Agent to be held as Collateral hereunder.
4.6 Equipment. Each Pledgor will, in accordance with sound business
---------
practices, maintain all Equipment used by it in its business (other than
obsolete Equipment) in good repair, working order and condition (normal wear and
tear excepted) and make all necessary repairs and replacements thereof so that
the value and operating efficiency thereof shall at all times be maintained and
preserved. No Pledgor shall knowingly permit any Equipment to become a fixture
to any real property.
4.7 Inventory. Each Pledgor will, in accordance with sound business
---------
practices, maintain all Inventory held by it or on its behalf in good saleable
or useable condition. Unless notified otherwise by the Administrative Agent in
accordance with the terms hereof, each Pledgor may, in any lawful manner not
inconsistent with the provisions of this Agreement and the other Credit
Documents, process, use and, in the ordinary course of business but not
otherwise, sell its Inventory. Without limiting the generality of the
foregoing, each Pledgor agrees that it shall not permit any Inventory to be in
the possession of any bailee, warehouseman, agent or processor at any time
unless such bailee, warehouseman, agent or processor shall have been notified of
the security interest created by this Agreement and such Pledgor shall have
exercised its reasonable best efforts to obtain, at such Pledgor's sole cost and
expense, a written agreement to hold such Inventory subject to the security
interest created by this Agreement and the instructions of the Administrative
Agent and to waive and release any Lien (whether arising
13
by operation of law or otherwise) it may have with respect to such Inventory,
such agreement to be in form and substance reasonably satisfactory to the
Administrative Agent.
4.8 Contracts. Each Pledgor will, at its expense, at all times perform
---------
and comply with, in all material respects, all terms and provisions of each
Material Contract to which it is or hereafter becomes a party required to be
performed or complied with by it and enforce the terms and provisions thereof in
accordance with its terms, and will not waive, amend or modify any provision
thereof in any manner other than in the ordinary course of business of such
Pledgor in accordance with past practices and for a valid economic reason
benefiting such Pledgor (provided that in no event may any waiver, amendment or
--------
modification be made that would adversely affect the interests of the
Administrative Agent and the other Secured Parties). Each Pledgor will deliver
copies of each Material Contract to which it is a party and each material
amendment or modification thereof to the Administrative Agent promptly upon the
execution and delivery thereof. With regard to all leases, contracts and
agreements that are excluded from the definition of the term "Contracts," each
Pledgor covenants and agrees to exercise all of its material rights and remedies
under such leases, agreements and contracts to which it is a party in a
commercially reasonable manner consistent with the interests of the
Administrative Agent and the Secured Parties. No Pledgor will enter into any
Material Contract that by its terms prohibits the assignment of such Pledgor's
rights and interest thereunder in the manner contemplated by this Agreement,
other than as may be entered into in the ordinary course of business of such
Pledgor in accordance with past practices and for a valid economic reason
benefiting such Pledgor. Each Pledgor further covenants and agrees to use its
reasonable best efforts to obtain any required consent to the collateral
assignment of any Material Contract, in form and substance reasonably
satisfactory to the Administrative Agent, upon the request of the Administrative
Agent, and will deliver copies thereof to the Administrative Agent promptly upon
execution and delivery thereof. To the extent required under the Credit
Agreement, each Pledgor will notify the Administrative Agent promptly in writing
upon any termination of any Material Contract, in whole or in part, or any
material breach, default or event of default by any party thereunder.
4.9 Taxes. Each Pledgor will pay and discharge (i) all taxes, assessments
-----
and governmental charges or levies imposed upon it, upon its income or profits
or upon any of its properties, prior to the date on which penalties would attach
thereto, and (ii) all lawful claims that, if unpaid, might become a Lien upon
any of its properties; provided, however, that no Pledgor shall be required to
-------- -------
pay any such tax, assessment, charge, levy or claim that is being contested in
good faith and by proper proceedings and as to which such Pledgor has maintained
adequate reserves with respect thereto in accordance with Generally Accepted
Accounting Principles, unless and until any tax lien notice has become effective
with respect thereto or until any Lien resulting therefrom attaches to its
properties and becomes enforceable against its other creditors.
4.10 Insurance. (a) Each Pledgor will maintain and pay for, or cause to
---------
be maintained and paid for, insurance covering commercial general liability,
property and casualty, business interruption and such other risks, and in such
amounts and with such financially sound and reputable insurance companies, as
are usually and customarily carried by companies of similar size engaged in
similar businesses (and in any event, insuring all Inventory and Equipment
14
against such losses and risks), and will deliver certificates of such insurance
to the Administrative Agent with standard loss payable endorsements naming the
Administrative Agent as loss payee (on property and casualty policies) and
additional insured (on liability policies) as its interests may appear. Each
such policy of insurance shall contain a clause requiring the insurer to give
not less than thirty (30) days' prior written notice to the Administrative Agent
before any cancellation of the policies for any reason whatsoever and shall
provide that any loss shall be payable in accordance with the terms thereof
notwithstanding any act of any Pledgor that might result in the forfeiture of
such insurance.
(b) As and to the extent required by the Credit Agreement, and in any
event upon and during the continuance of an Event of Default, the proceeds
payable under policies of property and casualty insurance covering Collateral
shall be applied as a prepayment of the Loans in the order and manner provided
in the Credit Agreement. Each Pledgor hereby irrevocably makes, constitutes and
appoints the Administrative Agent at all times during the continuance of an
Event of Default, its true and lawful attorney (and Administrative Agent-in-
fact) for the purpose of making, settling and adjusting claims under such
policies of insurance, endorsing its name on any check, draft, instrument or
other item or payment for the proceeds of such policies of insurance and for
making all determinations and decisions with respect to such policies of
insurance.
(c) If any Pledgor fails to obtain and maintain any of the policies of
insurance required to be maintained hereunder or to pay any premium in whole or
in part, the Administrative Agent may, without waiving or releasing any
obligation or Default, at the Pledgors' expense, but without any obligation to
do so, procure such policies or pay such premiums. All sums so disbursed by the
Administrative Agent, including reasonable attorneys' fees, court costs,
expenses and other charges related thereto, shall be payable by the Pledgors to
the Administrative Agent on demand and shall be additional Secured Obligations
hereunder, secured by the Collateral.
(d) Each Pledgor will deliver to the Administrative Agent, promptly as
rendered, true copies of all material claims and reports made in any reporting
forms to insurance companies. Not less than 30 days prior to the expiration
date of the insurance policies required to be maintained by any Pledgor
hereunder, such Pledgor will deliver to the Administrative Agent one or more
certificates of insurance evidencing renewal of the insurance coverage required
hereunder plus such other evidence of payment of premiums therefor as the
Administrative Agent may request. Upon the reasonable request of the
Administrative Agent from time to time, each Pledgor will deliver to the
Administrative Agent evidence that the insurance required to be maintained
pursuant to this Section is in effect.
4.11 Intellectual Property. (a) Each applicable Pledgor will, at its own
---------------------
expense, execute, deliver and record, as promptly as possible (but in any event
within 10 days) after the date hereof, fully completed assignments in the forms
of Exhibits A and B, as applicable, in the U.S. Copyright Office or the U.S.
---------- -
Patent and Trademark Office pursuant to 35 U.S.C. (S)261, 15 U.S.C. (S)1060 or
17 U.S.C. (S)205, as applicable, with regard to any Copyright Collateral, Patent
Collateral or Trademark Collateral, as the case may be, described in Annex C, D
------- -
or E hereto. In
-
15
the event that after the date hereof any Pledgor shall acquire any registered
Copyright, Patent or Trademark, or effect any registration of any Copyright,
Patent or Trademark or file any application for registration thereof, whether
within the United States or any other country or jurisdiction, such Pledgor
shall promptly furnish written notice thereof to the Administrative Agent
together with information sufficient to permit the Administrative Agent, upon
its receipt of such notice, to (and each Pledgor hereby authorizes the
Administrative Agent to) modify this Agreement, as appropriate, by amending
Annexes C, D and E hereto or to add additional exhibits hereto to include any
--------- - -
Copyright, Patent or Trademark that becomes part of the Collateral under this
Agreement, and such Pledgor shall additionally, at its own expense, execute,
deliver and record, as promptly as possible (but in any event within 10 days)
after the date of such acquisition, registration or application, as applicable,
with regard to United States Patents, Trademarks and Copyrights, fully completed
assignments in the forms of Exhibits A and B, as applicable, in the U.S.
Copyright Office or the U.S. Patent and Trademark Office as more fully described
hereinabove, together in all instances with any other agreements, instruments
and documents that the Administrative Agent may reasonably request from time to
time to further effect and confirm the assignment and security interest created
by this Agreement in such Copyrights, Patents and Trademarks, and each Pledgor
hereby appoints the Administrative Agent its attorney-in-fact to execute,
deliver and record any and all such agreements, instruments and documents for
the foregoing purposes, all acts of such attorney being hereby ratified and
confirmed and such power, being coupled with an interest, shall be irrevocable
for so long as this Agreement shall be in effect with respect to such Pledgor.
(b) Each Pledgor (either itself or through its licensees or its
sublicensees) will, for each Trademark used in the conduct of its business, use
its best efforts to (i) maintain such Trademark in full force and effect, free
from any claim of abandonment or invalidity for non-use, (ii) maintain the
quality of products and services offered under such Trademark, (iii) display
such Trademark with notice of federal registration to the extent required by
applicable law and (iv) not knowingly use or knowingly permit the use of such
Trademark in violation of any third-party rights.
(c) Each Pledgor (either itself or through its licensees or sublicensees)
will refrain from committing any act, or omitting any act, whereby any Patent
used in the conduct of such Pledgor's business may become invalidated or
dedicated to the public, and shall continue to xxxx any products covered by a
Patent with the relevant patent number as required by applicable patent laws.
(d) Each Pledgor (either itself or through its licensees or sublicensees)
will, for each work covered by a Copyright, continue to publish, reproduce,
display, adopt and distribute the work with appropriate copyright notice as
required under applicable copyright laws.
(e) Each Pledgor shall notify the Administrative Agent immediately if it
knows or has reason to know that any Patent, Trademark or Copyright used in the
conduct of its business may become abandoned or dedicated to the public, or of
any adverse determination or development (including the institution of, or any
such determination or development in, any proceeding in the U.S. Patent and
Trademark Office, U.S. Copyright Office or any court) regarding such Pledgor's
16
ownership of any Patent, Trademark or Copyright, its right to register the same,
or to keep and maintain the same.
(f) Each Pledgor will take all necessary steps that are consistent with
the practice in any proceeding before the U.S. Patent and Trademark Office, U.S.
Copyright Office or any office or agency in any political subdivision of the
United States or in any other country or any political subdivision thereof, to
maintain and pursue each application relating to any Patents, Trademarks or
Copyrights (and to obtain the relevant grant or registration) and to maintain
each registration of any Patents, Trademarks and Copyrights used in the conduct
of such Pledgor's business, including the filing of applications for renewal,
affidavits of use, affidavits of incontestability and maintenance fees, and, if
consistent with sound business judgment, to initiate opposition, interference
and cancellation proceedings against third parties.
(g) In the event that any Collateral consisting of a Patent, Trademark or
Copyright used in the conduct of any Pledgor's business is believed infringed,
misappropriated or diluted by a third party, such Pledgor shall notify the
Administrative Agent promptly after it learns thereof and shall, if consistent
with sound business judgment, promptly xxx for infringement, misappropriation or
dilution and to recover any and all damages for such infringement,
misappropriation or dilution, and take such other actions as are appropriate
under the circumstances to protect such Collateral.
(h) Upon the occurrence and during the continuance of any Event of
Default, each Pledgor shall use its reasonable best efforts to obtain all
requisite consents or approvals from the licensor of each License included
within the Copyright Collateral, Patent Collateral or Trademark Collateral to
effect the assignment of all of such Pledgor's right, title and interest
thereunder to the Administrative Agent or its designee.
4.12 Mobile Goods. Upon the request of the Administrative Agent at any
------------
time, whether or not an Event of Default shall have occurred and be continuing,
each Pledgor will deliver to the Administrative Agent originals of the
certificates of title or ownership for all Mobile Goods owned by it, together
(in the case of motor vehicles) with the manufacturer's statement of origin with
the Administrative Agent listed as lienholder and odometer statements and
together in all other cases with appropriate instruments or certificates of
transfer and delivery, duly completed and executed, and will take such other
action as the Administrative Agent may deem necessary to perfect the security
interest created by this Agreement in all such Mobile Goods.
4.13 Delivery of Collateral. All certificates or instruments representing
----------------------
or evidencing any Accounts, Intercompany Obligations or other Collateral shall
be delivered to and held by or on behalf of the Administrative Agent pursuant
hereto, shall be in form suitable for transfer by delivery and shall be
delivered together with undated stock powers duly executed in blank, appropriate
endorsements or other necessary instruments of registration, transfer or
assignment, duly executed and in form and substance satisfactory to the
Administrative Agent, and in each case such other instruments or documents as
the Administrative Agent may reasonably request.
17
4.14 Deposit and Collection Procedures. Each Pledgor will execute all
---------------------------------
such documents and agreements and take all such actions as are necessary to
ensure that all Proceeds of Accounts remitted to or otherwise received by it are
deposited, promptly upon its receipt thereof, directly into a Deposit Account
maintained by or for the benefit of such Pledgor and that the balances in each
such Deposit Account are transferred not less frequently than daily to a cash
concentration account maintained with the Administrative Agent or with another
bank or depository institution that has, together with the applicable Pledgor,
executed and delivered to the Administrative Agent a duly completed agreement,
in form and substance satisfactory to the Administrative Agent, that among other
things acknowledges the security interest of the Administrative Agent in all
funds, monies, securities and instruments deposited in such account and pursuant
to which such bank or depository institution agrees to transfer such funds,
monies, securities and instruments to the Administrative Agent promptly upon
demand at any time after the occurrence and during the continuance of an Event
of Default (each such account, a "Concentration Account," and each such
agreement, a "Concentration Agreement"). Each Pledgor will provide each bank or
depository institution at which any Deposit Account is maintained from time to
time with such transfer instructions and other information as such bank or
depository institution may require in order to permit such Pledgor to comply
with the provisions of this Section. All costs and expenses incurred in
connection with the establishment and maintenance of such Deposit Accounts and
Concentration Accounts and the transfers of funds therefrom and thereto as
described in this Section shall be for the account of the Pledgors. No Proceeds
of Accounts will be deposited in or at any time transferred to a Deposit Account
other than a Concentration Account or a Deposit Account the balances in which
are transferred not less frequently than weekly (or during the continuance of an
Event of Default, daily) to a Concentration Account. No Pledgor shall cause or
permit any funds or other property not constituting Proceeds of Collateral to be
deposited into any Deposit Account containing Proceeds of Collateral. So long
as no Event of Default shall have occurred and be continuing, the Pledgors shall
have the right to collect, withdraw and direct the disposition of funds on
deposit in the Concentration Accounts in a manner not inconsistent with the
provisions of this Agreement or any of the other Credit Documents; provided,
--------
however, that upon the occurrence and during the continuance of an Event of
-------
Default and notice thereof from the Administrative Agent to the Borrower, the
Administrative Agent shall have exclusive dominion and control over all
Concentration Accounts, with the powers and rights granted herein and in the
applicable Concentration Agreements with respect thereto, and no Pledgor shall
have any right to collect, withdraw or direct the disposition of funds on
deposit in the Concentration Accounts or to take any action to effect the same.
Any failure by any Pledgor to observe, perform or comply with any provision of
this Section shall constitute an Event of Default under the Credit Agreement.
4.15 Protection of Security Interest. Each Pledgor agrees that it will,
-------------------------------
at its own cost and expense, take any and all actions necessary to warrant and
defend the right, title and interest of the Secured Parties in and to the
Collateral against the claims and demands of all other Persons.
18
ARTICLE V
REMEDIES
5.1 Remedies. If an Event of Default shall have occurred and be
--------
continuing, the Administrative Agent shall be entitled to exercise in respect of
the Collateral all of its rights, powers and remedies provided for herein or
otherwise available to it under any other Credit Document, by law, in equity or
otherwise, including all rights and remedies of a secured party under the
Uniform Commercial Code, and shall be entitled in particular, but without
limitation of the foregoing, to exercise the following rights, which each
Pledgor agrees to be commercially reasonable:
(a) To notify any or all account debtors or obligors under any Accounts,
Contracts or other Collateral of the security interest in favor of the
Administrative Agent created hereby and to direct all such Persons to make
payments of all amounts due thereon or thereunder directly to the Administrative
Agent or to an account designated by the Administrative Agent; and in such
instance and from and after such notice, all amounts and Proceeds (including
wire transfers, checks and other instruments) received by any Pledgor in respect
of any Accounts, Contracts or other Collateral shall be received in trust for
the benefit of the Administrative Agent hereunder, shall be segregated from the
other funds of such Pledgor and shall be forthwith deposited into such account
or paid over or delivered to the Administrative Agent in the same form as so
received (with any necessary endorsements or assignments), to be held as
Collateral and applied to the Secured Obligations as provided herein; and by
this provision, each Pledgor irrevocably authorizes and directs each Person who
is or shall be a party to or liable for the performance of any Contract, upon
receipt of notice from the Administrative Agent to the effect that an Event of
Default has occurred and is continuing, to attorn to or otherwise recognize the
Administrative Agent as owner under such Contract and to pay, observe and
otherwise perform the obligations under such Contract to or for the
Administrative Agent or the Administrative Agent's designee as though the
Administrative Agent or such designee were such Pledgor named therein, and to do
so until otherwise notified by the Administrative Agent;
(b) To take possession of, receive, endorse, assign and deliver, in its
own name or in the name of any Pledgor, all checks, notes, drafts and other
instruments relating to any Collateral, including receiving, opening and
properly disposing of all mail addressed to any Pledgor concerning Accounts and
other Collateral; to verify with account debtors or other contract parties the
validity, amount or any other matter relating to any Accounts or other
Collateral, in its own name or in the name of any Pledgor; to accelerate any
indebtedness or other obligation constituting Collateral that may be accelerated
in accordance with its terms; to take or bring all actions and suits deemed
necessary or appropriate to effect collections and to enforce payment of any
Accounts or other Collateral; to settle, compromise or release in whole or in
part any amounts owing on Accounts or other Collateral; and to extend the time
of payment of any and all Accounts or other amounts owing under any Collateral
and to make allowances and adjustments with respect thereto, all in the same
manner and to the same extent as any Pledgor might have done;
19
(c) To notify any or all depository institutions with which any Deposit
Accounts are maintained to remit and transfer all monies, securities and other
property on deposit in such Deposit Accounts or deposited or received for
deposit thereafter to the Administrative Agent, for deposit in a Collateral
Account or such other accounts as may be designated by the Administrative Agent,
for application to the Secured Obligations as provided herein;
(d) To execute and file all necessary applications with the FCC and with
any governmental or other authority, and to act on any Pledgor's behalf, at such
Pledgor's cost, in obtaining any orders, consents, approvals, licenses or
certificates required by any Governmental Authority as a prerequisite to any
transfer of such Pledgor's business, operations or facilities relating to any of
the Collateral, to the extent permitted by applicable law;
(e) To transfer to or register in its name or the name of any of its
Administrative Agents or nominees all or any part of the Collateral, without
notice to any Pledgor and with or without disclosing that such Collateral is
subject to the security interest created hereunder;
(f) To assign any Copyright Collateral, Patent Collateral or Trademark
Collateral, for such term or terms, on such conditions and in such manner as the
Administrative Agent shall determine; and to license and (to the extent
permitted by applicable law) sublicense, whether general, or otherwise, and
whether on an exclusive or nonexclusive basis, any Copyright Collateral, Patent
Collateral or Trademark Collateral, throughout the world, for such term or
terms, on such conditions and in such manner as the Administrative Agent shall
determine;
(g) To require any Pledgor to, and each Pledgor hereby agrees that it will
at its expense and upon request of the Administrative Agent forthwith, assemble
all or any part of the Collateral as directed by the Administrative Agent and
make it available to the Administrative Agent at a place designated by the
Administrative Agent;
(h) To enter and remain upon the premises of any Pledgor and take
possession of all or any part of the Collateral, with or without judicial
process; to use the materials, services, books and records of any Pledgor for
the purpose of liquidating or collecting the Collateral, whether by foreclosure,
auction or otherwise; and to remove the same to the premises of the
Administrative Agent or any designated Administrative Agent for such time as the
Administrative Agent may desire, in order to effectively collect or liquidate
the Collateral;
(i) To exercise (i) all voting, consensual and other rights and powers
pertaining to the Investment Property (whether or not transferred into the name
of the Administrative Agent), at any meeting of shareholders, partners, members
or otherwise, and (ii) any and all rights of conversion, exchange, subscription
and any other rights, privileges or options pertaining to the Investment
Property as if it were the absolute owner thereof (including, without
limitation, the right to exchange at its discretion any and all of the
Investment Property upon the merger, consolidation, reorganization,
reclassification, combination of shares or interests, similar rearrangement or
other similar fundamental change in the structure of the applicable issuer, or
upon the exercise by any Pledgor or the Administrative Agent of any right,
privilege or option pertaining to such Investment Property, and in connection
therewith, the right to deposit and deliver any and all of the Investment
Property with any committee, depositary, transfer agent,
20
registrar or other designated agency upon such terms and conditions as the
Administrative Agent may determine, and give all consents, waivers and
ratifications in respect of the Investment Property, all without liability
except to account for any property actually received by it, but the
Administrative Agent shall have no duty to exercise any such right, privilege or
option or give any such consent, waiver or ratification and shall not be
responsible for any failure to do so or delay in so doing; and for the foregoing
purposes each Pledgor will promptly execute and deliver or cause to be executed
and delivered to the Administrative Agent, upon request, all such proxies and
other instruments as the Administrative Agent may reasonably request to enable
the Administrative Agent to exercise such rights and powers; AND IN FURTHERANCE
OF THE FOREGOING AND WITHOUT LIMITATION THEREOF, EACH PLEDGOR HEREBY IRREVOCABLY
CONSTITUTES AND APPOINTS THE ADMINISTRATIVE AGENT AS THE TRUE AND LAWFUL PROXY
AND ATTORNEY-IN-FACT OF SUCH PLEDGOR, WITH FULL POWER OF SUBSTITUTION IN THE
PREMISES, TO EXERCISE ALL SUCH VOTING, CONSENSUAL AND OTHER RIGHTS AND POWERS TO
WHICH ANY HOLDER OF ANY INVESTMENTS WOULD BE ENTITLED BY VIRTUE OF HOLDING THE
SAME, WHICH PROXY AND POWER OF ATTORNEY, BEING COUPLED WITH AN INTEREST, IS
IRREVOCABLE AND SHALL BE EFFECTIVE FOR SO LONG AS THIS AGREEMENT SHALL BE IN
EFFECT; and
(j) To sell, resell, assign and deliver, in its sole discretion, all or any
of the Collateral, in one or more parcels, with respect to Investment Property,
on any securities exchange on which any Investment Property may be listed, at
public or private sale, at any of the Administrative Agent's offices or
elsewhere, for cash, upon credit or for future delivery, at such time or times
and at such price or prices and upon such other terms as the Administrative
Agent may deem satisfactory. If any of the Collateral is sold by the
Administrative Agent upon credit or for future delivery, the Administrative
Agent shall not be liable for the failure of the purchaser to purchase or pay
for the same and, in the event of any such failure, the Administrative Agent may
resell such Collateral. In no event shall any Pledgor be credited with any part
of the Proceeds of sale of any Collateral until and to the extent cash payment
in respect thereof has actually been received by the Administrative Agent. Each
purchaser at any such sale shall hold the property sold absolutely, free from
any claim or right of whatsoever kind, including any equity or right of
redemption of any Pledgor, and each Pledgor hereby expressly waives all rights
of redemption, stay or appraisal, and all rights to require the Administrative
Agent to marshal any assets in favor of such Pledgor or any other party or
against or in payment of any or all of the Secured Obligations, that it has or
may have under any rule of law or statute now existing or hereafter adopted. No
demand, presentment, protest, advertisement or notice of any kind (except any
notice required by law, as referred to below), all of which are hereby expressly
waived by each Pledgor, shall be required in connection with any sale or other
disposition of any part of the Collateral. If any notice of a proposed sale or
other disposition of any part of the Collateral shall be required under
applicable law, the Administrative Agent shall give the applicable Pledgor at
least ten (10) days' prior notice of the time and place of any public sale and
of the time after which any private sale or other disposition is to be made,
which notice each Pledgor agrees is commercially reasonable. The Administrative
Agent shall not be obligated to make any sale of Collateral if it shall
determine not to do so, regardless of the fact that notice of sale may have been
given. The Administrative Agent may, without notice or publication, adjourn any
public or
21
private sale or cause the same to be adjourned from time to time by announcement
at the time and place fixed for sale, and such sale may, without further notice,
be made at the time and place to which the same was so adjourned. Upon each
public sale and, to the extent permitted by applicable law, upon each private
sale, the Administrative Agent may purchase all or any of the Collateral being
sold, free from any equity, right of redemption or other claim or demand, and
may make payment therefor by endorsement and application (without recourse) of
the Secured Obligations in lieu of cash as a credit on account of the purchase
price for such Collateral.
To enforce the provisions of this Agreement, the Administrative Agent is
empowered to seek from the FCC and any other Governmental Authority, to the
extent required, consent to or approval of an involuntary transfer of control of
any Pledgor or any of its Subsidiaries for the purpose of seeking a bona fide
purchaser to whom control will ultimately be transferred. Each Pledgor hereby
agrees to authorize and to cause its Subsidiaries to authorize such an
involuntary transfer of control upon the request of the Administrative Agent
after and during the continuation of an Event of Default and, without limiting
any rights of the Administrative Agent under this Agreement, authorize the
Administrative Agent to nominate a trustee or receiver to assume control,
subject only to any required judicial, FCC and other Governmental Authority
consent, in order to effectuate the transactions contemplated hereby. Such
trustee or receiver shall have all the rights and powers as provided to it by
law, court order or to the Administrative Agent under this Agreement. Each
Pledgor shall cooperate fully and cause its Subsidiaries to cooperate fully in
obtaining the consent of the FCC and the approval or consent of each other
Governmental Authority required to effectuate the foregoing. Each Pledgor shall
further use its best efforts, and will cause its Subsidiaries to use their best
efforts, to assist in obtaining consent or approval of the FCC and any other
Governmental Authority, if required, for any action or transactions contemplated
by this Agreement including, without limitation, the preparation, execution and
filing with the FCC of the transferor's portion of any application or
applications for consent to the transfer of control necessary or appropriate
under the FCC's rules and regulations for approval of the transfer or assignment
of any portion of the Collateral. If any Pledgor fails to execute or cause the
execution of such applications, requests for consent or other instruments, the
clerk of any court that has jurisdiction over the Credit Documents may execute
and file the same on behalf of such Pledgor or its Subsidiaries.
5.2 Application of Proceeds. (a) All Proceeds collected by the
-----------------------
Administrative Agent upon any sale, other disposition of or realization upon any
of the Collateral, together with all other moneys received by the Administrative
Agent hereunder, shall be applied as follows:
(i) first, to the payment of all costs and expenses of such sale,
disposition or other realization, including the reasonable costs and
expenses of the Administrative Agent and the reasonable fees and expenses
of its Administrative Agents and counsel, all amounts advanced by the
Administrative Agent for the account of any Pledgor, and all other amounts
payable to the Administrative Agent under SECTION 7.1;
(ii) second, after payment in full of the amounts specified in
clause (i) above, to the ratable payment of all other Secured Obligations
owing to the Secured Parties; and
22
(iii) third, after payment in full of the amounts specified in
clauses (i) and (ii) above, and following the termination of this
Agreement, to the Pledgors or any other Person lawfully entitled to receive
such surplus.
(b) For purposes of applying amounts in accordance with this Section, the
Administrative Agent shall be entitled to rely upon any Secured Party that has
entered into a Hedge Agreement with the Borrower for a determination (which such
Secured Party agrees to provide or cause to be provided upon request of the
Administrative Agent) of the outstanding Secured Obligations owed to such
Secured Party under any such Hedge Agreement. Unless it has actual knowledge
(including by way of written notice from any such Secured Party) to the
contrary, the Administrative Agent, in acting hereunder, shall be entitled to
assume that no Hedge Agreements or Secured Obligations in respect thereof are in
existence between any Secured Party and the Borrower.
(c) Each Pledgor shall remain liable to the extent of any deficiency
between the amount of all Proceeds realized upon sale or other disposition of
the Collateral pursuant to this Agreement and the aggregate amount of the sums
referred to in clauses (i) and (ii) of subsection (a) above. Upon any sale of
any Collateral hereunder by the Administrative Agent (whether by virtue of the
power of sale herein granted, pursuant to judicial proceeding, or otherwise),
the receipt of the Administrative Agent or the officer making the sale shall be
a sufficient discharge to the purchaser or purchasers of the Collateral so sold,
and such purchaser or purchasers shall not be obligated to see to the
application of any part of the purchase money paid over to the Administrative
Agent or such officer or be answerable in any way for the misapplication
thereof.
5.3 Collateral Accounts. Upon the occurrence and during the continuance of
-------------------
an Event of Default, the Administrative Agent shall have the right to cause to
be established and maintained, at its principal office or such other location or
locations as it may establish from time to time in its discretion, one or more
cash collateral bank accounts (collectively, "Collateral Accounts") for the
collection of cash Proceeds of the Collateral. Such Proceeds, when deposited,
shall continue to constitute Collateral for the Secured Obligations and shall
not constitute payment thereof until applied as herein provided. The
Administrative Agent shall have sole dominion and control over all funds
deposited in any Collateral Account, and such funds may be withdrawn therefrom
only by the Administrative Agent. Upon the occurrence and during the
continuance of an Event of Default, the Administrative Agent shall have the
right to (and, if directed by the Required Lenders pursuant to the Credit
Agreement, shall) apply amounts held in the Collateral Accounts in payment of
the Secured Obligations in the manner provided for in SECTION 5.2.
5.4 Grant of License. For the purpose of enabling the Administrative
----------------
Agent to exercise rights and remedies under SECTION 5.1 at such time as the
Administrative Agent shall be lawfully entitled to exercise such rights and
remedies, each Pledgor hereby grants to the Administrative Agent an irrevocable,
non-exclusive license (exercisable without payment of royalty or other
compensation to any Pledgor) to use, license or sublicense any Patent
Collateral, Trademark Collateral or Copyright Collateral now owned or licensed
or hereafter acquired or
23
licensed by such Pledgor, wherever the same may be located throughout the world,
for such term or terms, on such conditions and in such manner as the
Administrative Agent shall determine, whether general, special or otherwise, and
whether on an exclusive or nonexclusive basis, and including in such license
reasonable access to all media in which any of the licensed items may be
recorded or stored and to all computer software and programs used for the
compilation or printout thereof. The use of such license or sublicense by the
Administrative Agent shall be exercised, at the option of the Administrative
Agent, only upon the occurrence and during the continuation of an Event of
Default; provided that any license, sublicense or other transaction entered
--------
into by the Administrative Agent in accordance herewith shall be binding upon
each applicable Pledgor notwithstanding any subsequent cure of an Event of
Default.
5.5 The Pledgors Remain Liable. Notwithstanding anything herein to the
--------------------------
contrary, (i) each Pledgor shall remain liable under all Contracts to which it
is a party included within the Collateral (including, without limitation, all
Investment Agreements) to perform all of its obligations thereunder to the same
extent as if this Agreement had not been executed, (ii) the exercise by the
Administrative Agent of any of its rights or remedies hereunder shall not
release any Pledgor from any of its obligations under any of such Contracts, and
(iii) except as specifically provided for hereinbelow, the Administrative Agent
shall not have any obligation or liability by reason of this Agreement under any
of such Contracts, nor shall the Administrative Agent be obligated to perform
any of the obligations or duties of any Pledgor thereunder or to take any action
to collect or enforce any claim for payment assigned hereunder. This Agreement
shall not in any way be deemed to obligate the Administrative Agent, any other
Secured Party or any purchaser at a foreclosure sale under this Agreement to
assume any of a Pledgor's obligations, duties or liabilities under any
Investment Agreement, including, without limitation, any Pledgor's obligations,
if any, to manage the business and affairs of the applicable partnership, joint
venture, limited liability company or other issuer (collectively, the "Partner
Obligations"), unless the Administrative Agent or such other Secured Party or
purchaser otherwise agrees in writing to assume any or all of such Partner
Obligations. In the event of foreclosure by the Administrative Agent hereunder,
then except as provided in the preceding sentence, each applicable Pledgor shall
remain bound and obligated to perform its Partner Obligations and neither the
Administrative Agent nor any other Secured Party shall be deemed to have assumed
any Partner Obligations. In the event the Administrative Agent, any other
Secured Party or any purchaser at a foreclosure sale elects to become a
substitute member in place of a Pledgor, the party making such election shall
adopt in writing such Investment Agreement and agree to be bound by the terms
and provisions thereof; and subject to the execution of such written agreement,
each Pledgor hereby irrevocably consents in advance to the admission of the
Administrative Agent, any other Secured Party or any such purchaser as a
substitute member tot he extent of the Investments acquired pursuant to such
sale, and agrees to execute any documents or instruments and take any other
action as may be necessary or as may be reasonably requested in connection
therewith. The powers, rights and remedies conferred on the Administrative
Agent hereunder are solely to protect its interest and privilege in such
Contracts, as Collateral, and shall not impose any duty upon it to exercise any
such powers, rights or remedies.
5.6 Waivers. Each Pledgor, to the greatest extent not prohibited by
-------
applicable law, hereby (i) agrees that it will not invoke, claim or assert the
benefit of any rule of law or statute
24
now or hereafter in effect (including, without limitation, any right to prior
notice or judicial hearing in connection with the Administrative Agent's
possession, custody or disposition of any Collateral or any appraisal,
valuation, stay, extension, moratorium or redemption law), or take or omit to
take any other action, that would or could reasonably be expected to have the
effect of delaying, impeding or preventing the exercise of any rights and
remedies in respect of the Collateral, the absolute sale of any of the
Collateral or the possession thereof by any purchaser at any sale thereof, and
waives the benefit of all such laws and further agrees that it will not hinder,
delay or impede the execution of any power granted hereunder to the
Administrative Agent, but that it will permit the execution of every such power
as though no such laws were in effect, (ii) waives all rights that it has or may
have under any rule of law or statute now existing or hereafter adopted to
require the Administrative Agent to marshal any Collateral or other assets in
favor of such Pledgor or any other party or against or in payment of any or all
of the Secured Obligations, and (iii) waives all rights that it has or may have
under any rule of law or statute now existing or hereafter adopted to demand,
presentment, protest, advertisement or notice of any kind (except notices
expressly provided for herein).
ARTICLE VI
THE ADMINISTRATIVE AGENT
6.1 The Administrative Agent; Standard of Care. The Administrative Agent
------------------------------------------
will hold all items of the Collateral at any time received under this Agreement
in accordance with the provisions hereof. The obligations of the Administrative
Agent as holder of the Collateral and interests therein and with respect to the
disposition thereof, and otherwise under this Agreement and the other Credit
Documents, are only those expressly set forth in this Agreement and the other
Credit Documents. The Administrative Agent shall act hereunder at the
direction, or with the consent, of the Required Lenders on the terms and
conditions set forth in the Credit Agreement. The powers conferred on the
Administrative Agent hereunder are solely to protect its interest, on behalf of
the Secured Parties, in the Collateral, and shall not impose any duty upon it to
exercise any such powers. Except for treatment of the Collateral in its
possession in a manner substantially equivalent to that which the Administrative
Agent, in its individual capacity, accords its own property of a similar nature,
and the accounting for moneys actually received by it hereunder, the
Administrative 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 the Collateral. Neither the Administrative Agent nor any
other Secured Party shall be liable to any Pledgor (i) for any loss or damage
sustained by such Pledgor, or (ii) for any loss, damage, depreciation or other
diminution in the value of any of the Collateral that may occur as a result of
or in connection with or that is in any way related to any exercise by the
Administrative Agent or any other Secured Party of any right or remedy under
this Agreement, any failure to demand, collect or realize upon any of the
Collateral or any delay in doing so, or any other act or failure to act on the
part of the Administrative Agent or any other Secured Party, except to the
extent that the same is caused by its own gross negligence or willful
misconduct.
25
6.2 Further Assurances; Attorney-in-Fact. (a) Each Pledgor agrees that
------------------------------------
it will join with the Administrative Agent to execute and, at its own expense,
file and refile under the Uniform Commercial Code such financing statements,
continuation statements and other documents and instruments in such offices as
the Administrative Agent may reasonably deem necessary or appropriate, and
wherever required or permitted by law, in order to perfect and preserve the
Administrative Agent's security interest in the Collateral, and hereby
authorizes the Administrative Agent to file financing statements and amendments
thereto relating to all or any part of the Collateral without the signature of
such Pledgor where permitted by law, and agrees to do such further acts and
things (including, without limitation, making any notice filings with state tax
or revenue authorities required to be made by account creditors in order to
enforce any Accounts in such state) and to execute and deliver to the
Administrative Agent such additional conveyances, assignments, agreements and
instruments as the Administrative Agent may reasonably require or deem advisable
to perfect, establish, confirm and maintain the security interest and Lien
provided for herein, to carry out the purposes of this Agreement or to further
assure and confirm unto the Administrative Agent its rights, powers and remedies
hereunder.
(b) Each Pledgor hereby irrevocably appoints the Administrative Agent its
lawful attorney-in-fact, with full authority in the place and stead of such
Pledgor and in the name of such Pledgor, the Administrative Agent or otherwise,
and with full power of substitution in the premises (which power of attorney,
being coupled with an interest, is irrevocable for so long as this Agreement
shall be in effect), from time to time in the Administrative Agent's discretion
after the occurrence and during the continuance of an Event of Default to take
any action and to execute any instruments that the Administrative Agent may deem
necessary or advisable to accomplish the purpose of this Agreement, including,
without limitation:
(i) to sign the name of such Pledgor on any financing statement,
continuation statement, notice or other similar document that, in the
Administrative Agent's opinion, should be made or filed in order to perfect
or continue perfected the security interest granted under this Agreement
(including, without limitation, any title or ownership applications for
filing with applicable state agencies to enable any motor vehicles now or
hereafter owned by the Company to be retitled and the Administrative Agent
listed as lienholder thereon);
(ii) to ask, demand, collect, xxx for, recover, compound, receive
and give acquittance and receipts for moneys due and to become due under or
in respect of any of the Collateral;
(iii) to receive, endorse and collect any checks, drafts,
instruments, chattel paper and other orders for the payment of money made
payable to such Pledgor representing any interest, income, dividend,
distribution or other amount payable in respect of any of the Collateral
and to give full discharge for the same;
(iv) to obtain, maintain and adjust any property or casualty
insurance required to be maintained by such Pledgor under SECTION 4.10 and
direct the payment of proceeds thereof to the Administrative Agent;
26
(v) to pay or discharge taxes, Liens or other encumbrances levied
or placed on or threatened against the Collateral, the legality or validity
thereof and the amounts necessary to discharge the same to be determined by
the Administrative Agent in its sole discretion, any such payments made by
the Administrative Agent to become Secured Obligations of the Pledgors to
the Administrative Agent, due and payable immediately and without demand;
(vi) to file any claims or take any action or institute any
proceedings that the Administrative Agent may deem necessary or advisable
for the collection of any of the Collateral or otherwise to enforce the
rights of the Administrative Agent with respect to any of the Collateral;
and
(vii) to use, sell, assign, transfer, pledge, make any agreement
with respect to or otherwise deal with any and all of the Collateral as
fully and completely as though the Administrative Agent were the absolute
owner of the Collateral for all purposes, and to do from time to time, at
the Administrative Agent's option and the Pledgors' expense, all other acts
and things deemed necessary by the Administrative Agent to protect,
preserve or realize upon the Collateral and to more completely carry out
the purposes of this Agreement.
(c) If any Pledgor fails to perform any covenant or agreement contained
in this Agreement after written request to do so by the Administrative Agent
provided that no such request shall be necessary at any time after the
--------
occurrence and during the continuance of an Event of Default), the
Administrative Agent may itself perform, or cause the performance of, such
covenant or agreement and may take any other action that it deems necessary and
appropriate for the maintenance and preservation of the Collateral or its
security interest therein, and the reasonable expenses so incurred in connection
therewith shall be payable by the Pledgors under SECTION 7.1.
ARTICLE VII
MISCELLANEOUS
7.1 Indemnity and Expenses. The Pledgors agree jointly and severally:
----------------------
(a) To indemnify and hold harmless the Administrative Agent, each other
Secured Party and each of their respective directors, officers, employees,
Administrative Agents and affiliates from and against any and all claims,
damages, demands, losses, obligations, judgments and liabilities (including,
without limitation, reasonable attorneys' fees and expenses) in any way arising
out of or in connection with this Agreement and the transactions contemplated
hereby, except to the extent the same shall arise as a result of the gross
negligence or willful misconduct of the party seeking to be indemnified; and
(b) To pay and reimburse the Administrative Agent upon demand for all
reasonable costs and expenses (including, without limitation, reasonable
attorneys' fees and expenses) that
27
the Administrative Agent may incur in connection with (i) the custody, use or
preservation of, or the sale of, collection from or other realization upon, any
of the Collateral, including the reasonable expenses of re-taking, holding,
preparing for sale or lease, selling or otherwise disposing of or realizing on
the Collateral, (ii) the exercise or enforcement of any rights or remedies
granted hereunder (including, without limitation, under ARTICLE V), under any of
the other Credit Documents or otherwise available to it (whether at law, in
equity or otherwise), or (iii) the failure by any Pledgor to perform or observe
any of the provisions hereof. The provisions of this Section shall survive the
execution and delivery of this Agreement, the repayment of any of the Secured
Obligations, the termination or expiration of all Letters of Credit under the
Credit Agreement, the termination of the Commitments under the Credit Agreement
and the termination of this Agreement or any other Credit Document.
7.2 No Waiver. The rights and remedies of the Secured Parties expressly
---------
set forth in this Agreement and the other Credit Documents are cumulative and in
addition to, and not exclusive of, all other rights and remedies available at
law, in equity or otherwise. No failure or delay on the part of any Secured
Party in exercising any right, power or privilege shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right, power or
privilege preclude any other or further exercise thereof or the exercise of any
other right, power or privilege or be construed to be a waiver of any Default or
Event of Default. No course of dealing between the Pledgors and the Secured
Parties or their Administrative Agents or employees shall be effective to amend,
modify or discharge any provision of this Agreement or any other Credit Document
or to constitute a waiver of any Default or Event of Default. No notice to or
demand upon any Pledgor in any case shall entitle such Pledgor or any other
Pledgor to any other or further notice or demand in similar or other
circumstances or constitute a waiver of the right of any Secured Party to
exercise any right or remedy or take any other or further action in any
circumstances without notice or demand.
7.3 Pledgors' Obligations Absolute. Each Pledgor agrees that its
------------------------------
obligations hereunder, and the security interest granted to and all rights,
remedies and powers of the Administrative Agent hereunder, are irrevocable,
absolute and unconditional and shall not be discharged, limited or otherwise
affected by reason of any of the following, whether or not such Pledgor has
knowledge thereof:
(i) any change in the time, manner or place of payment of, or in any
other term of, any Secured Obligations, or any amendment, modification or
supplement to, restatement of, or consent to any rescission or waiver of or
departure from, any provisions of the Credit Agreement, any Subsidiary
Guaranty, any other Credit Document or any agreement or instrument
delivered pursuant to any of the foregoing;
(ii) the invalidity or unenforceability of any Secured
Obligations or any provisions of the Credit Agreement, any Subsidiary
Guaranty, any other Credit Document or any agreement or instrument
delivered pursuant to any of the foregoing;
(iii) the addition or release of Pledgors hereunder or the
taking, acceptance or release of any Secured Obligations or additional
Collateral or other security therefor;
28
(iv) any sale, exchange, release, substitution, compromise,
nonperfection or other action or inaction in respect of any Collateral or
other direct or indirect security for any Secured Obligations, or any
discharge, modification, settlement, compromise or other action or inaction
in respect of any Secured Obligations;
(v) any agreement not to pursue or enforce or any failure to
pursue or enforce (whether voluntarily or involuntarily as a result of
operation of law, court order or otherwise) any right or remedy in respect
of any Secured Obligations or any Collateral or other security therefor, or
any failure to create, protect, perfect, secure, insure, continue or
maintain any Liens in any such Collateral or other security;
(vi) the exercise of any right or remedy available under the
Credit Documents, at law, in equity or otherwise in respect of any
Collateral or other security for any Secured Obligations, in any order and
by any manner thereby permitted, including, without limitation, foreclosure
on any such Collateral or other security by any manner of sale thereby
permitted, whether or not every aspect of such sale is commercially
reasonable;
(vii) any bankruptcy, reorganization, arrangement, liquidation,
insolvency, dissolution, termination, reorganization or like change in the
corporate structure or existence of the Borrower, any other Pledgor or any
other Person directly or indirectly liable for any Secured Obligations;
(viii) any manner of application of any payments by or amounts
received or collected from any Person, by whomsoever paid and howsoever
realized, whether in reduction of any Secured Obligations or any other
obligations of the Borrower or any other Person directly or indirectly
liable for any Secured Obligations, regardless of what Secured Obligations
may remain unpaid after any such application; or
(ix) any other circumstance that might otherwise constitute a
legal or equitable discharge of, or a defense, set-off or counterclaim
available to, the Borrower, any Pledgor or a surety or guarantor generally,
other than the occurrence of all of the following: (x) the payment in full
of the Secured Obligations, (y) the termination of the Commitments and the
termination or expiration of all Letters of Credit under the Credit
Agreement, and (z) the termination of, and settlement of all obligations of
the Borrower under, each Hedge Agreement to which the Borrower and any
Lender are parties (the events in clauses (x), (y) and (z) above,
collectively, the "Termination Requirements").
7.4 Enforcement. By its acceptance of the benefits of this Agreement,
-----------
each Lender agrees that this Agreement may be enforced only by the
Administrative Agent, acting upon the instructions or with the consent of the
Required Lenders as provided for in the Credit Agreement, and that no Lender
shall have any right individually to enforce or seek to enforce this Agreement
or to realize upon any Collateral or other security given to secure the payment
and performance of the Secured Obligations.
29
7.5 Amendments, Waivers, etc. No amendment, modification, waiver,
------------------------
discharge or termination of, or consent to any departure by any Pledgor from,
any provision of this Agreement, shall be effective unless in a writing executed
and delivered in accordance with SECTION 11.6 of the Credit Agreement, and then
the same shall be effective only in the specific instance and for the specific
purpose for which given.
7.6 Continuing Security Interest; Term; Successors and Assigns;
-----------------------------------------------------------
Assignment; Termination and Release; Survival. This Agreement shall create a
---------------------------------------------
continuing security interest in the Collateral and shall secure the payment and
performance of all of the Secured Obligations as the same may arise and be
outstanding at any time and from time to time from and after the date hereof,
and shall (i) remain in full force and effect until the occurrence of the
Termination Requirements, (ii) be binding upon and enforceable against each
Pledgor and its successors and assigns (provided, however, that no Pledgor may
-------- -------
sell, assign or transfer any of its rights, interests, duties or obligations
hereunder without the prior written consent of the Lenders) and (iii) inure to
the benefit of and be enforceable by each Secured Party and its successors and
assigns. Upon any sale or other disposition by any Pledgor of any Collateral in
a transaction expressly permitted hereunder or under or pursuant to the Credit
Agreement or any other applicable Credit Document, the Lien and security
interest created by this Agreement in and upon such Collateral shall be
automatically released, and upon the satisfaction of all of the Termination
Requirements, this Agreement and the Lien and security interest created hereby
shall terminate; and in connection with any such release or termination, the
Administrative Agent, at the request and expense of the applicable Pledgor, will
execute and deliver to such Pledgor such documents and instruments evidencing
such release or termination as such Pledgor may reasonably request and will
assign, transfer and deliver to such Pledgor, without recourse and without
representation or warranty, such of the Collateral as may then be in the
possession of the Administrative Agent (or, in the case of any partial release
of Collateral, such of the Collateral so being released as may be in its
possession). All representations, warranties, covenants and agreements herein
shall survive the execution and delivery of this Agreement and any Pledgor
Accession.
7.7 Additional Pledgors. Each Pledgor recognizes that the provisions of
-------------------
the Credit Agreement require Persons that become Subsidiaries of the Borrower,
and that are not already parties hereto, to execute and deliver a Pledgor
Accession, whereupon each such Person shall become a Pledgor hereunder with the
same force and effect as if originally a Pledgor hereunder on the date hereof,
and agrees that its obligations hereunder shall not be discharged, limited or
otherwise affected by reason of the same, or by reason of the Administrative
Agent's actions in effecting the same or in releasing any Pledgor hereunder, in
each case without the necessity of giving notice to or obtaining the consent of
such Pledgor or any other Pledgor.
7.8 Notices. All notices and other communications provided for hereunder
-------
shall be given to the parties in the manner and subject to the other notice
provisions set forth in the Credit Agreement.
30
7.9 Governing Law. This Agreement shall be governed by and construed and
-------------
enforced in accordance with the laws of the State of North Carolina (without
regard to the conflicts of law provisions thereof).
7.10 Severability. To the extent any provision of this Agreement is
------------
prohibited by or invalid under the applicable law of any jurisdiction, such
provision shall be ineffective only to the extent of such prohibition or
invalidity and only in such jurisdiction, without prohibiting or invalidating
such provision in any other jurisdiction or the remaining provisions of this
Agreement in any jurisdiction.
7.11 Construction. The headings of the various sections and subsections
------------
of this Agreement have been inserted for convenience only and shall not in any
way affect the meaning or construction of any of the provisions hereof. Unless
the context otherwise requires, words in the singular include the plural and
words in the plural include the singular.
7.12 Counterparts. This Agreement may be executed in any number of
------------
counterparts and by different parties hereto on separate counterparts, each of
which when so executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument.
31
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
under seal by their duly authorized officers as of the date first above written.
THE XXXXXXXX GROUP, INC.
By: _______________________________
Title: ____________________________
XXXXXXXX AIRPORT ADVERTISING, INC.
By: _______________________________
Title: ____________________________
XXXXXXXX COMMUNICATIONS OF
MASSACHUSETTS, INC.
By: _______________________________
Title: ____________________________
AK MEDIA GROUP, INC.
By: _______________________________
Title: ____________________________
(Signatures continued on following page)
32
CENTRAL NEW YORK NEWS, INC.
By: ________________________________
Title: _____________________________
KJR RADIO, INC.
By: ________________________________
Title: _____________________________
KVOS TV, LTD.
By: ________________________________
Title: _____________________________
(Signatures continued on following page)
33
SSI, INC.
By: ________________________________
Title: _____________________________
TC AVIATION, INC.
By: ________________________________
Title: _____________________________
WIXT TV, INC.
By: ________________________________
Title: _____________________________
WOKR, INC.
By: ________________________________
Title: _____________________________
Accepted and agreed to:
FIRST UNION NATIONAL BANK, as
Administrative Agent
By: _____________________________
Title: __________________________
34
Annex A to Security Agreement
First Union National Bank, as
Administrative Agent
The Xxxxxxxx Group, Inc.
January 22, 1999
____________________________________
FILING LOCATIONS
The Xxxxxxxx Group, Inc.
Department of Licensing of Washington
Xxxxxxxx Airport Advertising, Inc.
Department of Licensing of Washington
Xxxxxxxx Communications of Massachusetts, Inc. (Inactive)
Department of Licensing of Washington
Secretary of State of Massachusetts
AK Media Group, Inc.
Department of Licensing of Washington
Secretary of State of Oregon
Secretary of State of California
Secretary of State of Colorado
Secretary of State of Florida
Secretary of State of Massachusetts
Central New York News, Inc.
Department of Licensing of Washington
Secretary of State of New York
SSI, Inc.
Department of Licensing of Washington
TC Aviation, Inc.
Department of Licensing of Washington
[No local filings necessary]
Annex B to Security Agreement
First Union National Bank, as Administrative Agent
The Xxxxxxxx Group, Inc.
January 22, 1999
____________________________________
LOCATIONS OF CHIEF EXECUTIVE OFFICES,
RECORDS RELATING TO COLLATERAL, AND EQUIPMENT AND INVENTORY
-------------------------------------------------------------------------------
Name
Of Chief Executive Offices Records Relating to
Pledgor Collateral
--------------------------------------------------------------------------------
0000 Xxxxx Xxx. 0000 Xxxxx Xxx.
The Xxxxxxxx Group, Inc. Xxxxx 0000 Xxxxx 0000
Xxxxxxx, XX 00000 Xxxxxxx, XX 00000
--------------------------------------------------------------------------------
0000 Xxxxx Xxx. 0000 Xxxxx Xxx.
Xxxxxxxx Airport Suite 4000 Suite 4000
Advertising, Inc. Xxxxxxx, XX 00000 Xxxxxxx, XX 00000
--------------------------------------------------------------------------------
0000 Xxxxx Xxx. 0000 Xxxxx Xxx.
Xxxxxxxx Communications Suite 4000 Suite 4000
of Massachusetts, Inc. Xxxxxxx, XX 00000 Xxxxxxx, XX 00000
--------------------------------------------------------------------------------
0000 Xxxxx Xxx. 0000 Xxxxx Xxx
XX Media Group, Inc. Xxxxx 0000 Xxxxx 0000
Xxxxxxx, XX 00000 Xxxxxxx, XX 00000
and (3)
--------------------------------------------------------------------------------
0000 Xxxxx Xxx. 0000 Xxxxx Xxx.
Xxxxxxx Xxx Xxxx News, Suite 4000 Suite 4000
Inc. Xxxxxxx, XX 00000 Xxxxxxx, XX 00000
and (6)
--------------------------------------------------------------------------------
KVOS TV Ltd. 0000 Xxxxx Xxxxxx X/X
Xxxxxxxxxx, XX 00000
--------------------------------------------------------------------------------
0000 Xxxxx Xxx. 0000 Xxxxx Xxx.
SSI, Inc. Xxxxx 0000 Xxxxx 0000
Xxxxxxx, XX 00000 Xxxxxxx, XX 00000
--------------------------------------------------------------------------------
0000 Xxxxx Xxx. 0000 Xxxxx Xxx.
TC Aviation, Inc. Xxxxx 0000 Xxxxx 0000
Xxxxxxx, XX 00000 Xxxxxxx, XX 00000
--------------------------------------------------------------------------------
LOCATIONS OF CHIEF EXECUTIVE OFFICES,
RECORDS RELATING TO COLLATERAL, AND EQUIPMENT AND INVENTORY
-----------------------------------------------------------------------------------------------------------------------------------
Name Equipment
Of or Other Places Trade/Fictitious/Other
Pledgor Inventory of Corporate Names
Business (Former Corporate or Trade names)
-----------------------------------------------------------------------------------------------------------------------------------
0000 Xxxxx Xxx. N/A Currently: None
The Xxxxxxxx Group, Inc. Suite 4000 Formerly: Xxxxxxxx
Xxxxxxx, XX 00000 Communications, Inc.;
Incorporated
----------------------------------------------------------------------------------------------------------------------------------
0000 Xxxxx Xxx. (1) Currently: None
Xxxxxxxx Airport Suite 4000 Formerly: AK Media Airport
Advertising, Inc. Xxxxxxx, XX 00000
----------------------------------------------------------------------------------------------------------------------------------
(Inactive) (Inactive) None
Xxxxxxxx Communications 0000 Xxxxx Xxx. (2)
of Massachusetts, Inc. Xxxxx 0000
Xxxxxxx, XX 00000
----------------------------------------------------------------------------------------------------------------------------------
0000 Xxxxx Xxx. (3) (4) for current names
AK Media Group, Inc. Suite 4000 (5) for former names
Xxxxxxx, XX 00000
and (3)
----------------------------------------------------------------------------------------------------------------------------------
0000 Xxxxx Xxx. (6) Currently: WIVT TV;
Central New York News, Suite 4000 WIXT TV
Inc. Xxxxxxx, XX 00000 Formerly: WIXT TV, Inc.;
and (6) WIXT TV
----------------------------------------------------------------------------------------------------------------------------------
KVOS TV Ltd. N/A N/A None
----------------------------------------------------------------------------------------------------------------------------------
0000 Xxxxx Xxx. N/A Currently: Seattle
SSI, Inc. Suite 4000 Supersonics; Supersonics
Xxxxxxx, XX 00000 Formerly: Seattle
Supersonics, Inc.
SSI Sports, Inc.
----------------------------------------------------------------------------------------------------------------------------------
0000 Xxxxx Xxx. X/X None
TC Aviation, Inc. Xxxxx 0000
Xxxxxxx, XX 00000
and (7)
----------------------------------------------------------------------------------------------------------------------------------
(1) Qualified to do business in Alabama, Alaska, Arizona, California, Colorado,
Connecticut, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas,
Kentucky, Louisiana, Maryland, Massachusetts, Michigan, Mississippi, Missouri,
Montana, Nebraska, New Jersey, New Mexico, New York, North Carolina, Ohio,
Oklahoma, Oregon, Pennsylvania, Puerto Rico, Rhode Island, South Carolina,
Tennessee, Texas, Utah, Virginia, Wisconsin, Wyoming, but only current activity
is pursuant to a service agreement with the purchaser of Xxxxxxxx Airport
advertising assets.
(2) If active, company would also be doing business in Massachusetts.
(3) All other States where AK Media Group is conducting business: Oregon,
California, Colorado, Florida and Massachusetts. See attached list for
addresses.
(4) AK Media Florida; AK Media Massachusetts; AK Media Northwest; Xxxxxxxx
Realty; Adshelters; Empire Outdoor Advertising; Empire Outdoor Advertising of
the Northwest; KCBA TV; KCOY TV; KFTY TV; KGET TV; KHHO(AM); KHHO Radio;
KJR(AM); KJR-FM; KJR Radio: -KKTV; KMTR TV; KMTX TV; KMTZ TV; XXXX(FM); KVIQ TV;
KVOS TV; KKTV; Full House Sports and Entertainment; New Century Media; Portland
Antenna Company; Seattle Supersonics; Supersonics.
(5) Xxxxxxxx Incorporated; Xxxxxxxx Realty, Inc.; Xxxxxxxx Communications
Group, Inc.; KJR Radio, Inc.; New Century Seattle Partners, L.P.; Xxxxxxxx
Communications of Massachusetts, Inc.; Empire Outdoor Advertising of
Massachusetts, Inc.; Xxxxxxxx Communications of Florida, Inc.; Adshelters,
Incorporated; Empire Outdoor Advertising, Inc.; Xxxxxxxx Communications of the
Northwest, Inc.; Empire Outdoor Advertising of the Northwest, Inc.; Full House
Sports and Entertainment, Inc.; National Airport Advertising Sales, Inc.;
Northwest Sport Sales, Inc.; Portland Antenna Company, Inc.; Seattle Seadogs,
Inc.; Cypress Broadcasting, Inc.; KGET TV, Inc.; KKTV, Inc.; Northwest Sports
Sales; Seattle Radio; Seattle Seadogs; Xxxxxxxx Communications of Florida;
Xxxxxxxx Communications of Massachusetts; Xxxxxxxx Outdoor Advertising; Xxxxxxxx
Communications of the Northwest; Cypress Broadcasting; Eye Street Productions.
(6) In addition, New York. See attached list for address.
(7) Additional equipment/inventory located at Boeing Field in Seattle,
Washington.
Attachment to Annex B
The Xxxxxxxx Group, Inc.
And Subsidiaries
Corporate and Trade Names
-------------------------
The Xxxxxxxx Group, Inc. KGET TV
0000 Xxxxx Xxxxxx (AK Media) 0000 X Xxxxxx (XX Xxxxx)
Xxxxx 0000 P.O. Box 1700
Xxxxxxx, XX 00000 Xxxxxxxxxxx, XX 00000
000-000-0000
AK Media Florida KKTV TV
0000 XX 00/xx/ Xxxxx (AK Media) 0000 Xxxxx Xxxxxx Xxxxxx
Xxxxx, XX 00000 X.X. Xxx 0000 (AK Media)
305-592-6250 Xxxxxxxx Xxxxxxx, XX 00000
000-000-0000
AK Media Massachusetts KVOS TV
00 Xxxxx Xxxxxx (AK Media) 0000 Xxxxx Xxxxxx (XX Xxxxx)
Xxxxxxxx, XX 00000 Xxxxxxxxxx, XX 00000
000-000-0000 000-000-0000
AK Media Northwest New Century Media
0000 Xxxxx Xxxxxx Xxxxx (AK Media) 000 Xxxxx Xxxx Xxxxxx Xxxxx
Xxxxxxx, XX 00000 Suite 100 (AK Media)
000-000-0000 Xxxxxxx, XX 00000
000-000-0000
Full House Sports & Entertainment KVIQ TV
000 Xxxxx Xxxx Xxxxxx Xxxxx 1800 Broadway
Suite 200 (AK Media) Xxxxxx, XX 00000 (AK Media)
Xxxxxxx, XX 00000 707-443-3061
000-000-0000
Seattle Supersonics KMTR TV
000 Xxxxx Xxxxxx Xxxxx (SSI) X.X. Xxx 0000
Xxxxxxx, XX 00000 Xxxxxx, XX 00000 (AK Media)
000-000-0000 000-000-0000
KCBA TV KCOY TV
1150 Xxxxxxx (AK Media) 0000 Xxxx XxXxx Xxxx
X.X. Xxx 0000 Xxxxx Xxxxx, XX 00000 (AK Media)
Xxxxxxx, XX 00000
000-000-0000
KFTY TV WIXT TV
000 Xxxxxxxxx Xxxxxx (AK Media) 0000 Xxxxxx Xxxxxx, Xxx 000
X.X. Xxx 0000 Xxxx Xxxxxxxx, XX 00000 (Central NY News)
Xxxxx Xxxx, XX 00000 000-000-0000
000-000-0000
WUTR TV
Xxxxx Hill Road (Central NY News)
Xxxxx, XX 00000
000-000-0000
WIVT TV
000 Xxxxxxxx Xxxx Xxxx (Xxxxxxx XX News)
Xxxxxxxxxx, XX 00000
000-000-0000
Annex C to Security Agreement
First Union National Bank, as Administrative
Agent
The Xxxxxxxx Group, Inc.
January 22, 1999
COPYRIGHTS AND COPYRIGHT APPLICATIONS
Application or Issue or
Pledgor Registration No. Country Filing Date
---------------------- ----------------------- ----------------------- -----------------------
None
Annex D to Security Agreement
First Union National Bank, as
The Xxxxxxxx Group, Inc.
_____________, 1999
____________________________________
PATENTS AND PATENT APPLICATIONS
Application or Issue or
Pledgor Registration No. Country Inventor Filing Date
------------------ ------------------- ------------------- ------------------- -------------------
None
Annex E to Security Agreement
First Union National Bank, as
The Xxxxxxxx Group, Inc.
January 22, 1999
____________________________________
TRADEMARKS AND TRADEMARK APPLICATIONS
Application or Issue or
Pledgor* Xxxx -------------- Country/State --------
-------- ---- Registration No. ------------- Filing Date
---------------- -----------
Xxxxxxxx Communications, Inc. "Project Xxxxxxxx" 0000000 Xxxxxx Xxxxxx Filed June 2, 1995
(and Design) (Federal)
Xxxxxxxx Xxxxxxxxxxxxxx xx "XXXX" 0000000 Xxxxxx Xxxxxx Filed June 5, 1991
Massachusetts, Inc. (Federal) and Assigned to GCI
Boston, Inc. on
Xxxxx 00, 0000
Xxxxxxxx Communications of "Lights out Tonight" 0000000 Xxxxxx Xxxxxx Filed June 29, 1989
Massachusetts, Inc. (Federal) Cancelled - Section 8
Xxxxxxxx Communications of "WBOS Earthwatch" 44065 Massachusetts Registered April
Massachusetts, Inc. 18, 1990 and
Assigned to GCI
Boston, Inc. on
August 28, 1990
Xxxxxxxx Communications of "The Odyssey File" 43446 Massachusetts Registered October
Massachusetts, Inc. 11, 1989 and
Assigned to GCI
Boston, Inc. on
August 28, 1992
Xxxxxxxx Communications of the "Larger than Life" 19553 Washington Registered February
Northwest, Inc. 23, 1990
Xxxxxxxx Communications Group, "Eyestreet Productions" 45341 California Registered December
Inc. (Image) 5, 1995
Xxxxxxxx Communications Group, "Kid News" 100745 California Registered December
Inc. (Image) 15, 1995
Xxxxxxxx Communications Group, "Kid Video" 45080 California Registered September
Inc. 14, 1995
Xxxxxxxx Communications Group, "Slam Jam" 45077 California Registered September
Inc. 14, 1995
Xxxxxxxx Communications Group, "17 Health Fair" (and 45480 California Registered January
Inc. Design) 17, 1996
KJR Radio, Inc. "K-Lite" Serial no. United States Filed March 27, 1990
74-043176 (Federal) Abandoned
(footnote on last page)
Application or Issue or
Pledgor Xxxx --------------------- Country/State -------------------
---------------------------------- ---------------------------- Registration No. -------------- Filing Date
--------------------- -------------------
KJR Radio, Inc. "KJR Sports Radio 950 AM" 28385 Washington Registered August
28, 1996
KJR Radio, Inc. "KJR 95.7 FM Greatest Hits 25384 Washington Registered August
of the 70's" 28, 1996
KJR Radio, Inc. "XXXX 93 FM" 25383 Washington Registered August
28, 1996
KJR Radio, Inc. "SUMMER JAM" 25382 Washington Registered August
28, 1996
KJR Radio, Inc. "K-LITE" 19503 Washington Registered January
24, 1990
WIXT TV, Inc. "NEWSCHANNEL 9 Coverage You S15822 New York Registered
Can Count On" September 19, 1997
WIXT TV, Inc. "( NEWS Weather Source" S14046 New York Registered March
25, 1994
Full House Sports and "Jammin' Hoops Camp" Serial no. United States Filed March 8, 1995
Entertainment, Inc. 74-645021 (Federal) Abandoned
Full House Sports and "Jammin' Hoops Camp" 23780 Washington Registered March
Entertainment, Inc. 9, 1995
Full House Sports and "Jammin' Hoops Camp" 23779 Washington Registered March
Entertainment, Inc. 9, 1995
New Century Media "Sports Radio" 27313 Washington Registered
September 1, 1998
New Century Media Limited Partners "The Xxxxxxx Xxxxx 26430 Washington Registered October
Foundation" 17, 1997
New Century Media Limited Partners "The Real Xxxxxxx Xxxxx" 26429 Washington Registered October
17, 1997
WIXT Television, Inc. "3-D Skytrack" Pending United States Filed November 5,
(75-385381) (Federal) 1997
(footnote on last page)
Exhibit A to Security Agreement
First Union National Bank, as Administrative Agent
The Xxxxxxxx Group, Inc.
_____________, 1999
__________________________________________________
ASSIGNMENT AND GRANT OF SECURITY INTEREST
IN COPYRIGHTS
WHEREAS, [NAME OF PLEDGOR] (the "Pledgor") is the owner of the copyrights
listed on Schedule A attached hereto, which copyrights are registered or have
----------
pending registrations in the United States Copyright Office as set forth on
Schedule A attached hereto (all such copyrights, registrations and applications,
----------
collectively, the "Copyrights"); and
WHEREAS, the Pledgor has entered into a Security Agreement (as amended,
modified, restated or supplemented from time to time, the "Security Agreement"),
dated as of _____________, 1999, in which the Pledgor has agreed with First
Union National Bank, as Administrative Agent (the "Administrative Agent"), with
offices at One First Union Center, 000 Xxxxx Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxx
Xxxxxxxx 00000-0000, to execute this Assignment;
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, as security for the payment and
performance of the Secured Obligations (as defined in the Security Agreement),
the Pledgor does hereby assign and grant to the Administrative Agent a security
interest in all of its right, title and interest in and to the Copyrights, and
the use thereof, together with all proceeds and products thereof and the
goodwill of the businesses symbolized by the Copyrights. This Assignment has
been given in conjunction with the assignment and security interest granted to
the Administrative Agent under the Security Agreement, and the provisions of
this Assignment are without prejudice to and in addition to the provisions of
the Security Agreement, which are incorporated herein by this reference.
[NAME OF PLEDGOR]
By: ____________________________________
Title: _________________________________
Schedule A
----------
COPYRIGHTS AND COPYRIGHT APPLICATIONS
Application or Issue or
Pledgor Registration No. Country Filing Date
------- ---------------- ------- -----------
2
Exhibit B to Security Agreement
First Union National Bank, as Administrative Agent
The Xxxxxxxx Group, Inc.
_____________, 1999
__________________________________________________
ASSIGNMENT AND GRANT OF SECURITY INTEREST
IN PATENTS AND TRADEMARKS
WHEREAS, [NAME OF PLEDGOR] (the "Pledgor") is the owner of the trademarks
and service marks listed on Schedule A attached hereto, which marks are
----------
registered or have pending registrations in the United States Patent and
Trademark Office as set forth on Schedule A attached hereto (all such
----------
trademarks, service marks, registrations and applications, collectively, the
"Trademarks") and is the owner of the patents listed on Schedule A attached
----------
hereto, which patents are registered or have pending applications in the United
States Patent and Trademark Office as set forth on Schedule A attached hereto
----------
(all such patents, registrations and applications, collectively, the "Patents");
and
WHEREAS, the Pledgor has entered into a Security Agreement (as amended,
modified, restated or supplemented from time to time, the "Security Agreement"),
dated as of _____________, 1999, in which the Pledgor has agreed with First
Union National Bank, as Administrative Agent (the "Administrative Agent"), with
offices at One First Union Center, 000 Xxxxx Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxx
Xxxxxxxx 00000-0000, to execute this Assignment;
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, as security for the payment and
performance of the Secured Obligations (as defined in the Security Agreement),
the Pledgor does hereby assign and grant to the Administrative Agent a security
interest in all of its right, title and interest in and to the Trademarks and
the Patents, and the use thereof, together with all proceeds and products
thereof and the goodwill of the businesses symbolized by the Trademarks and the
Patents. This Assignment has been given in conjunction with the assignment and
security interest granted to the Administrative Agent under the Security
Agreement, and the provisions of this Assignment are without prejudice to and in
addition to the provisions of the Security Agreement, which are incorporated
herein by this reference.
[NAME OF PLEDGOR]
By: ____________________________________
Title: _________________________________
TRADEMARKS AND TRADEMARK APPLICATIONS
Application or Issue or
Pledgor Xxxx Registration No. Country Filing Date
------- ---- ---------------- ------- -----------
PATENTS AND PATENT APPLICATIONS
Application or Issue or
Pledgor Registration No. Country Inventor Filing Date
------- ---------------- ------- -------- -----------
2
Exhibit C to Security Agreement
First Union National Bank, as Administrative Agent
The Xxxxxxxx Group, Inc.
_____________, 1999
__________________________________________________
FORM OF
PLEDGOR ACCESSION
THIS PLEDGOR ACCESSION (this "Accession"), dated as of _____________, ____,
is executed and delivered by ________________________, a ______________
corporation (the "Company"), in favor of First Union National Bank, in its
capacity as Administrative Agent under the Credit Agreement referred to
hereinbelow (in such capacity, the "Administrative Agent"), pursuant to the
Security Agreement referred to hereinbelow.
Reference is made to the Credit Agreement, dated as of ________________,
1999, among The Xxxxxxxx Group, Inc. (the "Borrower"), the Lenders party
thereto, and the Administrative Agent (as amended, modified or supplemented from
time to time, the "Credit Agreement"). In connection with and as a condition to
the initial and continued extensions of credit under the Credit Agreement, the
Borrower and certain of its subsidiaries have executed and delivered (i) [a
Subsidiary Guaranty, dated as of ________________, ____ (as amended, modified or
supplemented from time to time, the "Subsidiary Guaranty"), pursuant to which
such subsidiaries have guaranteed the payment in full of the obligations of the
Borrower under the Credit Agreement and the other Credit Documents (as defined
in the Credit Agreement),] and (ii) a Security Agreement, dated as of
________________, 1999 (as amended, modified or supplemented from time to time,
the "Security Agreement"), pursuant to which they have granted in favor of the
Administrative Agent a security interest in and Lien upon the Collateral
described therein as security for their obligations under the Credit Agreement,
the Subsidiary Guaranty and the other Credit Documents. Capitalized terms used
herein without definition shall have the meanings given to them in the Security
Agreement.
The Borrower has agreed under the Credit Agreement to cause each of its
future subsidiaries to become a party to the [Subsidiary Guaranty as a guarantor
thereunder and to the] Security Agreement as a Pledgor thereunder. The Company
is a subsidiary of the Borrower[ and, as required by the Credit Agreement, has
become a guarantor under the Subsidiary Guaranty as of the date hereof.] The
Company will obtain benefits as a result of the continued extension of credit to
the Borrower under the Credit Agreement, which benefits are hereby acknowledged,
and, accordingly, desire to execute and deliver this Accession. Therefore, in
consideration of the foregoing and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, and to induce the
Lenders to continue to extend credit to the Borrower under the Credit Agreement,
the Company hereby agrees as follows:
1. The Company hereby joins in and agrees to be bound by each and all of
the provisions of the Security Agreement as a Pledgor thereunder. In
furtherance (and without limitation) of the foregoing, pursuant to Section 2.1
of the Security Agreement, and as security for all of the Secured Obligations,
the Company hereby pledges, assigns and delivers to the
Administrative Agent, for the ratable benefit of the Secured Parties, and grants
to the Administrative Agent, for the ratable benefit of the Secured Parties, a
Lien upon and security interest in, all of its right, title and interest in and
to the Collateral as set forth in Section 2.1 of the Security Agreement, all on
the terms and subject to the conditions set forth in the Security Agreement.
2. The Company hereby represents and warrants that (i) Schedule 1 hereto
----------
sets forth all information required to be listed on Annexes A, B, C, D and E to
the Security Agreement in order to make each representation and warranty
contained in Sections 3.1 and 3.2 of the Security Agreement true and correct
with respect to the Company as of the date hereof and after giving effect to
this Accession and (ii) after giving effect to this Accession and to the
incorporation into such Annexes, as applicable, of the information set forth in
Schedule 1, each representation and warranty contained in Article III of the
Security Agreement is true and correct with respect to the Company as of the
date hereof, as if such representations and warranties were set forth at length
herein.
3. This Accession shall be a Credit Document (within the meaning of such
term under the Credit Agreement), shall be binding upon and enforceable against
the Company and its successors and assigns, and shall inure to the benefit of
and be enforceable by each Secured Party and its successors and assigns. This
Accession and its attachments are hereby incorporated into the Security
Agreement and made a part thereof.
2
IN WITNESS WHEREOF, the Company has caused this Accession to be executed
under seal by its duly authorized officer as of the date first above written.
[NAME OF COMPANY]
By: ____________________________________
Title: _________________________________
3
Schedule 1
----------
Information to be added to Annex A of the Security Agreement:
FILING LOCATIONS
Information to be added to Annex B of the Security Agreement:
LOCATIONS OF CHIEF EXECUTIVE OFFICES,
RECORDS RELATING TO COLLATERAL, AND EQUIPMENT AND INVENTORY
1. Chief executive office:
____________________________
____________________________
____________________________
2. Records relating to Collateral:
____________________________
____________________________
____________________________
3. Equipment or Inventory:
____________________________
____________________________
____________________________
4. Other places of business:
____________________________
____________________________
____________________________
4
5. Trade/fictitious or prior corporate names
(last five years):
____________________________
Information to be added to [Annexes C/D/E] of the Security Agreement:
[complete as applicable]
5
